Have you ever wondered how some people can get so rich, when it seems that they are no brighter than you?
We all think that there are people who deserve to be wealthy, maybe because they have a special talent. People like sports stars, film stars, entertainers and musicians.
But then there is a group of people who have got loads of money in the bank, have expensive cars and lifestyles, but don’t seem to be particularly talented or clever. They haven’t inherited their wealth, and many of these people left school early with few qualifications.
Lets look at a few examples.
First up is Sir Alan Sugar. Born into London’s East End just after the Second World War, left school at 16 years old, started working as a Civil Servant. Now he is worth in excess of £700m.
Another is Simon Cowell. Left school at 17 with three O-Levels to his name and is now worth £200m.
Or maybe the best loved billionaire in UK, Sir Richard Branson. He left school at 16 years old, having been diagnosed as dyslexic, and is now worth over £3 billion.
All of these people are hugely important in creating wealth for others and all have touched our own lives in one way or another. Their success is that all three discovered early on that the talents of other people are up for sale. What’s more is that many of these talented people do not know what their talents are worth, or how to negotiate a good deal.
One of the most popular TV programmes on right now has to be X-Factor. It has a brilliant format, with heroes and villains, laughs and tension, and audience participation both on set and at home. But who is making the most money? Mr Cowell of course, who signed up the winner before the first audition and will reap the rewards of their popularity for many years to come.
You may be thinking, “how does that apply to me”? After all you are a smart tech guy who knows your worth. Well, I doubt that anyone knows if your product will be taken up by 50% of the world population or will end up as a flash in a very small pan. If your idea, design and product is good then the chances are that it will need a Sir Alan Sugar, Simon Cowell or Sir Richard Branson to make it hugely valuable. But whilst you need their help you do not need to give them a bigger share of your earnings than necessary.
I have five tips to stop that from happening.
1. Think about your business model and what it needs to succeed. How are you going to market and sell your products? Who are your customers and how are you going to earn money from your idea?
2. Protect your idea. See a lawyer about IP protection and ensure that if anyone wants to copy it, you can take him or her to court and sue.
3. Choose your business partners wisely, and do not be star struck. Decide if you can trust them to put the hard work into making your product a success.
4. Do not sign anything you do not understand. Even if you are expected to understand something, don’t do it unless you can explain to your mates in the pub what it means.
5. Take advice. There are professional people who you can pay to be on your side and can guide you through making difficult decisions. Talk to your fellow entrepreneurs and mentors about who they would use.
It may sound simple, but it could be the difference between rags and riches.