• How'To

I COpYcat

- ¥ourWay To' ~

Wealth

Copy Nlarkcting 10 1

Howto Copycat YOl,If way to Wealth

by Burke Hedges

Copyright (Q) 1997 by UnrkeHcdges and Steve Price

An righas reserved under Irneruarional and Pan American Copyright c"Of-lve·ntions. Written permission must besecured from the publisher to use or reproduce any part o r this book; either in print or erectl'onict_lUy. except for brief quotations in book reviews 01,- news articles.

Printed in the United State of America Fit'lli Edltion~ October 21)01

TSBN 0 - ·9032667 ~'4 -.S

Published by INTl Publishing

Published by INTI Publishing Tampa.FL

Book Cover designed by Cherry Design Format and typogr'fpby by Bayou Graphics

ALSO 'BY BURKE :HIEDGES

WhO' stole the .. AmencCln Dream?

You Can 't Steal Second wilh YO'UT FQOl on Fit'SI.r

Yau" 11l€;. AudiO Series

((i audio cassettes and workbook)

rd lib! to' tha,nk the p,umeets of our indu.stry

lor .1iuu.ing tke trittl

and mapping thepaih to success fof' o,tke,rs "0 copycat.

Whe1'l'W'ordd we be taday' witk'Ou1 you.r vision, courage, antJ pt!rs:everan:c;'e?

v

D.ED.J CAliON

This bl'm.k. is dedicated to my parent» [,or pnJitidiJlg (l madel oj solid values and

. hard wotk for me to copycat

vu

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Chapter 2:, What Is "True'l We<llth.?' " .21

111iIU'odlllctiQA:' ljYQU Don't. Uke YourResil/ts, Change Your AppWtlch!" .... M .... ~ " .... , , ••• 1

Chapter 1: We Live ina Wodd o.f

Copy,cab.. ....• _" ,.,.. · .. •···· ·.9:

(:~j:rt.er 3: Linear Growfh:

Trading Timef6r DOUMS_" " .37

Ctlapter 4: L.ev'eraged Growth;

Wod;,ing Smartef'r. Not Harder ....... 51

Citm~U,et' 5~Exp onenUal Growth:

formu la Jim Buildin.g a lFortufte ... 65

Chaptc&X 16~ SynergisB'l: Marriages

.~d.c in. Heaven ~.~ 77·

~ap.~ar 7': Net'w"orkMarkeling,:

The U1 timate Co-pycat Sysb:m! .•. ..89

--------------------------- , ____

JIYou Don't Like Your Results, Cbang« Your Approach!

J[ l:"" o'U D..,n~1: Like Your Rei!!'IlIlts,

Change Your App:ruaclb

There. ate fWO things. needed thesedtJys:

Firsl-Fjor rich people to find. out how poor people Jive; ,am! s<econd, far pdQ'!' ,PeoPle lofind out how rich people work.

- lOhrt Foster

,0 .•...... ,' .. ne ~f. mybvorite businessstori~ is about '111 .. mIddle~ged manager strugglin~ to, pay His b~/'so he decides to get some advice from a £.furS/udal expert.

The m'anage r makes an appointment to m~ with a well-respected f'mandala,dvisor ·wh05:e~ offiCe was Ioea fed in a swanky build-

., . . n...-..:k A. .

mg On IC1:tl .~ .t',;. VI;:11I11il~.

Themanager enters the -expert's e.legantl y ''appointed reception room, but instead of a -~0f1ist, ·Ihe manager is ~ by tw-o dClOt$,

3

""" . .-, _ ..

one marked "'employed" nnd the other h:s-elfemp{oy,,cd_ "

He en ters the-door mal" ked" employed" and is greeted by two more doors .... one marked "makes· ress.fhcm; .$4()~ 000" and the other "ma.kes l~ore than $40.,000 •• ,

He makes lessthan $40(000, so he enters that door, onlytnfind himself face to face with two, more doors. The door on the left is marked' "saues more. than. $2,OO() a year," and the one on the right is marked ,r:sa_ves leSiS than. :Elf-ODO a

yt"ar, " .'

The mana:geronly has abou t a thousand dollars in his savings, so heertters the dooren.the r.ight-only to findhlmself right back on Park Avenue!

TIi,!: SAME DOORS LIE.AD To THE SAME FiIESULTS'

It's patinfu,Uy obvious that the m,an_,;rge.r in the story will never get out of his rut until-he starts cho~sj r~ to open dHferen t doors. Th l' moral of the' story is that most people are li~e the l11211l.0I&€r-they choose to enter the doors of life that lead them right):~ack to where they started,

The only 'way for people to ge+ different results is. to chooseto enter different db01"1;>,

. i't th: ?L k . .. ..

15n ~ , .:mt true. i· earle 6fmy mentors alway-s

4

-

u-sen to ~y:. "If you m.ntinue ia do whlt1 you've ~r, you'll continue ia get" whijr you/v£' .:$:Ootten. rr

A~ 'YOU A 95:% ·E'FI? .. , QiR A. 5'%-lER1

!U:i;ft Hke the manager ~n the story, most pe@]!{~ arE!' tllHght in a rut because they're bI"aFP,e~ in an end less cycle af financial I[rNls.frnUon.

Just like the manager in the storv, 95% of the 'W;6ikers in most industrialized "((!untri,efi are:"employe.d." they make less than $40/000 per-,ear "._ and they save-about $.2,000 per year-.

At fir.s.! stancel these figures look preti.'y fm'P,;essi:ve., .especlally to people who m,a,]<e· less th.<m $4.0,000. But the truthis, 9::)P/(> of the people mthrs,w.orld aren't gdting ehead=-they're just ~tllng by. Take a look at thefinancial condit~e.n·d~ th~ "average" US- citizen o;rLage 65:

·lo.OTYPICAiL AMERI.CANSA'T AGE 65

-l - .~:in.=~m.lly .lRd~P~i1(J,>n l '1. - Wmt~h~'

9.cbr.;:;h =0;-

1~

~~p>imd!m,i. Pill ti(hl:r,!'.

5

· How:abO:1atyou? AFe you opeillm:lg financial deorsthat will lead. to you becoIl'lkl,g a 95%<e'1'? Or are-you op€;:ru.ng the-ddonH:h.atwiU lead to financial independeeee, or even wealth. like tl1.e 5!1'!ry..,ets2

tva g~)t: to b~]ie\i~ that most peoplewant more fer-themselves ... more lor their fam:mes ..• than being dead, df;~d-br()ke', or still workmg: ~o make ends moot by age 65. I' ve g~)t to be]i;eve that if more prople un.dersbood 'f~efu:ll benefits o~' be~~ga 5'~el; there wcuHcl bea lo,f .morepooplechoosmgto open dilfer.e·rd:- doors

in.tfleirlives. . .

!1IAi~HE iFtm A.MmlENrT ...

lm<!,gme for a mQm.ent lli<,'tt rune andrrtoney weren~~ au issue in yOW' life,

Iml3!gl)::'I.e bemgable ·to walk: Y'QlH' kids lo .~ool every- mOmJng . ,. :and neverha 'ling to Im.5S a sdu)()lp}:ay or soccer game beceuse you had' to work.

Ima_gm~ pbnrrin:g yOUT' work around your g~U' ... u1istead qh/Dln: go.].f.an;rund. yOIJJ:I' work.

Iffii.l.gine guing on a v~ca,t:iQn .!'IDd.co:~mg back when. you want to ,come"i)3Icl; ratR,e"r than when your bQ~ sa:y~ you have to oome back. [:m~g~ paying elff yOill' car]o,an ... pa.:.~g ,o.ff your mo:rtg~g,e ... ·Md. iPa~ying.,bff your ,cred:it

Ei

-

ifaUi' hul.51 <ijt the. 'end of e~-e.ry month.

= ~~gine that you are one of th~ 5%-ers, :[lli"OUlli2i.<li1y."fted"O eome and go aSY0I:J please,

F1nil.Hy,:Wlagine fhat bJ- investing orie hom ~~illlr~nle r~ad~g this book" yo u will disCti!"i,f-et"'Ftlial yQI~\{e always been se!:ioching for .~ tl1:e' key to. wlecaUn ('tw!:i,m!

THE ,,&IfIf!O!S:'E OF nUs iBoOK

" ;f?S€I)'Dll ha~ lll:e o'ppO'rhlnll.1" [0 become

la-' I"-wquld you 'i:?ye,.id.'I.:'_<lntage of it?

Ls~G~,tEly' hope the m,swef to; tl'1ii1t.questi6n :l~ ~¥f' because that's'·whaL this ibook isall ;afr:@~L In the (omirrgpages you' will learri that Oe. secret to wandal: ITt'E..110,m is kuowil\g which

"~lP'Qis tCl.6P€]l:· .

'Copycat Marketi:ug Wlwill make you aware ':f~a~, most petple are 95%-,e:r:s because they've 'S:~"TI -taught to copy-people wlwa are opening .d;oqrrs 'tbet lead to salary c~p:S". d~?ld~eTId jobs ::&:ill frna,m;:i';pl depe§'lcie110e. In .snn-r(mo6t. W~{}:r·k

1tek'"O'Pljc.atting flu. wn::\ng plan! .

[in this book you will learn tbEl[ the current

~ . ." , .

:;ws,W;m most pe(jp Ie I;:opyca:t is designed to ere-

~tg~em:p0I:ary in0'Qilue-'n,oI. t rue vieaJtlli~beeause .1 t' s based OIl {Tneargrowth .of trading Iirne '"ip-r. doJlaxs.

'tou will learn that the key to ~rue w,ealth

7

creation is leverage, and you ~ learn about a dynamic form of leverage that wealthy people have he-en cqpying £nr centuries called e.xpo.nerl~ tied gt~wth.

You wUj learn that the "secret" to wealth creation is available ~D v:i:rtwily e\!'€'_rybody, mcluding people Iike -you and me .. bE::.~.a:Use' it's, based on sometiili:tg that we already know how to do welli-mpyca-tnng.

Best 0'[ all, you will learn how avera,g@ people can break out of thetime-ior-morrey trap by copycatting ,3 simple, dupltcatable system of wealth creation -fhat will open the door to financial freedom, once and for alll

,8

>

CHAPTE'R1

We-Live in a World of Copycats

9

CHA.PTER'1

~nildttn haw neveT been ue.ry geori at ijstin'i'ng to' their'eldets, B1Jt they base ,never:ji<iJed to im,itate thenJ.

r - James Baldwin •. author

O,nb. of the ftrst b.' ooks I remember re.:tding as a kid 'was. a joke book I can still r.e'm~b€F (J:ne of the corny jokes rna t used to crack - up iny friends. andme. it take'_£; rnontjJ to .1llak monry-you haae io copy the lle$ign ex,6/ctly.

Hey, I told yon It was a corny joke .. didn't I? But the sentiment is dead serious.

. 'Why haven't wcfoun.d a.way to copy:c~tt erea.tmg WfDltl1?

. 'Th.il:1ilkabout it--w,e! 'oopy,eact everything else in our lives, don't we? But the one .thing we haven't learned to C9'PY'C9it JS treat:ing\.rue wealth!' Let's take a few moments to talk about the power of cqpycattii,lg. And then w~'n look at some of the reasons most people have~it found a way 'to copycat wealth' creation.

ONE. l"INIG. WE'RIE Au. ,GOOD AT Is CO'PYCAnn~"G

. ' ~ch:of US is blessed. wi th certain talents and gifts that make us one-of-a ... kind mci:iv],du..aEs. Some people are gr€la t d.ancers, while others" can't tap their feet!:() the beat, Some of us.h~ve ~ tajfent for art, while others have tmuble drawmg.a stick figtrre. Some of us are §,Teat athletes, whiJIe otherscanbasely ~~a:stt.a:i:ght line w":'fu-

out s tumbi.b.1g. .

B~ut Nrc 'one thffl,g ,~cJrJltjd l.wy ooe orus is gooa {1.t- WJTHQI1T f:XGEP,TIO N-is

copycaHin&-, . .•. <

. Have yau t'Ver thought about how good we

are at COP'V'"'Cl' tl n 0'.' W···1!...· .

. . I' ~ '_.l , o· .. H'en It 'comes !hJI

copycatting, we're All gjif"ecd 1.>1.]'';'

.: :. .. . ~l~ . .•. - I\,'!', ... re copycat

gt>11.luses. CQPycatting is one· trait we aU excel

12:

;at anti that we ill! have- in common, no matter {odJel'e we liv'e~ no matter what OUI individual ~nts are. It wal • .es no difference Whethfc'I we .~ .~i.th or poor ... black or white ... maL~ or 'fe:rorue. T.. the' one fumg we're all great at is

:C@'ln',catting,

"S'll wh!1 haven't we fouNd a way to cop1ll'cal

",eating ·~:ltl~?'

leap.YeATS fROM THE 'CRADLE TO iN.1!! GRA.VE

t.oapycafu'ng starts 'the day we are born. We ()(:lPY the Iango age ;;II,Te ·speak ... the food we eat ... the ",""ay we wear our hair ... the way w'(~ w~Jl ... the way we dress .

Wher! we enie'f school, we: learn to reol.dand WT~ite by tOpying letters in the alphabet. If you w-e:re born in a western culture, yOIl copycatted the ·system. of writing from the left side of the pa:g.e to the right. If you were born in parts of ASia', you COPY'C3ttL',d writing from the right to the left.

As we grew older, vile Iearned to drive a

,liar by copyc'atnfLg, didn't we? The instructor "mowed us 'how t'o cheCK the rearview mirro r , .. tum 01'l the tum signa 1 .... p~sh slightly on

i:e ga.s pedal ... dri ve the speed Iimit :'.'. and oom~ 'to a full sIOP at interseCTIons. The b-etter we were at wpying OUI driving instructor. the easier it was toO pass our driver's test,

13

WH'EH IN ROME; _Do AS mE ROMANS Do

\I\leirc 6:(} good at copycatt~ng the people around US that we are often shocked by thE' customs and habits of people from dlff~ent cultures, That's whirr tlt.c 'expressiun '''IVhrn in ROrJ'lf,·do whrd the Ronw1'.ls do" b: all.about, Jt's ~ plain way ohayjng that \'Ii.e need to hOO()I and rcspf'~ct~ifff-vreh.t cultures, especia fly when We a re VISl n ng . other countries,

But; thai's a lqi eaS.ier said than done, Wc get so comfortable with copycatting the custo .. ans around us that we're Q(fenrunazed and amused wh~n we hear what other .cultures are copyc.atHng- This shortlist of the fj]vorile snacks of TV watchers around the WOJdd will show you j ust what I mean:

United States - popcorn China - dlicken feet J"PilTI -t~a 5and~·-jches

:\1 ex leo - ears of r(1ast€d corn

I ,:--~ ''_ .

• J'.,1hl. - m u tton.sand w iches

Ko':rca - SUIl ~drled squid

Dld you think to yourself" ;'IIOtl-' could ];l!I:."Y. en! THAT? Sun-dried ~quid? __ . Chic,feli{e,h? •... 1'QU'I.Je gat til" hi~ ki"ddfng,l But guess ; ........ hat y.ou'd probably be snacking on- while yo~

14

,.~., t,;;~:.sd TV if you gre-\oI,' up in Korea -. .. that's

\ ... <'I.,k,iI . ..,. . r

'hl'I. ."f stm-:gxi,ed squid.

1'1:tl?" I· .

mp'¥C~:rnNG1HEWAYWEWORK

~~~~S'lg(i,:y point: There ate.roU11tl~ss:d.ifferitm!5es11'e1:yYeencu ltures, btl t the one thmg every, £1;],ltu,re has in common is the way we go' 1!'!lar-lliI1g, the customs we pr:actke-----we. r;.apycq.t'J yv e oopyoa.t SO m urn tha [" we take it fo.:'.g:;:anted. Copycatting is so prevalent fh.at

• if![s.~0:.oTId nature to us" like breathing au; SQ 1 i!J...~ y.ql~'~g~iri, Why i~trUen't l!Je found a. R1Qy to

@.w'l#_fQeati:ngWfalth?

~~'k:e ne-mistake about it, copycaUing is, the 1.[;H~~t F"Qw~ful J earning tool 'known to hu tn.aI'15' Copy.eaU:ing impects virtually every single phas€:' or OIIT lives, from our smallest habits to G;u/'bfggesf life ... alteri ng decisions.

-lk'lr example, we spend ,a big part of om lives at "lkorck. Did you ever stop to consider hm .... ' )Ii. ,u U!Mrl~d to 'p erfcrm the tasks you perform -at. work? How rod you learn tB wrjt,e u_~tte'l" €l&the.' eotnputer? How djd you know what to ~~ar to' the' .o-ffiJCe? And how did you t.each mb,ems '~ho ,were new on the job? By teaching lli. ill to copycat what you did; isn't that true? rJn~ j.)Bychologisrs call it "modeling and I'I'lIirroring. " I call it bei t'lg a prC!fe~sion al cupy('~t!

I.wt- .....

. NQ qnesti9n~ We copycat our way Ihtough life from the' cradle to 'the grave' because copycatting is easy to do, ... we' don'thave to .keep creating everything from scratch: an the ~m~ .... it works .- ... and we're born ~~mll]ses 'a t It~ The ~E'lSShm "Mrmkeg Sei!, monkey do" could [ust as e~ny'~ "peiJp,re sl!e,peop1e do,'"

_ Tha f s why I say weBve ina world of copy~a~s. lft~e~$ (me thing every~ si"glf_' pf7S0nin thJS world SgDOO at-it's. copycatting!

,ASHom Hts1nn;Y LfSSON. ON COPYING, .JOBS

We even gOo so far as to copycat .how we earn m()i]1E!y .. For tho1!.l:Sands of years ddidreTI

of.fanne- rnn .... '"""" AI ,~L"';;T' p'" _-",k' .. -- ,.lI.'. 'L .. ·. .-

. ~,r ._,' ~~I;'U. LlI<::... . '" .·=u'" <11 ru '[J.ec~me

~armets ~... clU ldr:en. of shoemakers become shoemakers, That's why SQ many of our iast names ,_orne from the trades, names Uk,e Faone.r, Smith ·Car:pente..-. Tallo r, and

•. . -L, • t ' ....... ' .SO on_

_ .' ~ith the a~vmt of the Industrial Revolution, millions ofchildren"'With lastna .... ieslik - ..... F .

_ ' .. ou •.• · -' ."", arrner

Smith, Carpenter and Tajlor broke away fro~ th~ctanrilyttadeand ~ealded to fhetity to OJ'p~~ cat a new concept of work-'fue job,

Copycatting the job worked preli)' well Jor several generations espt>.!Ci4.n,; n- "I A' me .". . ~i:...

~ . ...au, _ '.1 I conca_, tine

undisputed king of the Industrial Revolution. Because the first half of the 20th c'entury w:as

1Si

~~had~«'ied by two world wars an? the ~atDe'~'on,~ost peop~~ w.ere ffi'eIJoyed ,WI"C.f1F1lM:t:mlm' faQ':Lily and friendls Mid work a

. i~e,"~ ... fi'Ve jot,~ And as l:cmg as people~.s :~pe4~tio-~ didn't exceed thei~ s~ndard of· 'li~-F.rop'le who copycatted the ·gotta-.g·et~ ,~1o:b" ;menitality were content wiiili w]w:Uhey

h~¢i~

blINKBEFb~ loU ICoPYOAT

Like most everytillrtg. in Iife, there's a flip side to t:I?'pycatti.ng. Just because: we (opyrnt wmetlb'ing doesn't necessarily make it good ... .,' .. ,. ClT productive. UnforrunateiYI aJl t; 0 ·ciffu.n-oopyc!attlng·ls an e:x:cus~ to gedazyin

'0ur.'fuin;king-

h: rerItifldsme of the story about the old

shap~~r on Main Street who placed a gr.andfa:ili~r:dock in the front "\I\.'indow of his 'store. ~e.~· the; yea'l'~ the shop~eeper noticeclfuat CI di~flhg;lJjshlS'd.-li)b.king man would walk by the Slt1r,eevf::ry .day at nQGU __ . pause in1iont of the S. , :_;!f!1l!tller cloek . - - pull out a pocket W3 feh

~are{iilly set me time.

@ne day th~ shop keeper" S curioslty got the. baSt .of him, When the g;entlem;:l n paus-ed In fiOM 0'1 the' grandfather clock, the sbopkeeper ,r:aIl out of the store and asked the u{an why he set WS'wailrn each and every day-

17

The map smiled and replied, "I'm the ftneman at the toum milt" he said. "I bkxa the quitting whistle-at 5;(J{j each dai!l. tmdl want. to be sure it goes off tx(Jc1ly: on time:"

The old shop keepe,~ ga ve him. a startled look -and then burst out Iaughlng. The man stepped back and asked indignantly, "w'hl1f'S

S"f,"'n ;>". U.-", .. ny.

"I' "l ' I h I k '"

m sorry_, repue: rI, e SJ10p eepl:!t_. I didn' t

meanto be rude; But ljust had to laugh. You; see, al! thtS8 yei.w5 roe been seitinr mit grand-fatlw' dock tv ymlr 5.1)0 ;vhi.<;tle! " U -".. "

This-story 1$ a pc}:fect illustration of the

do.wns,ide ~'?h;QPy~atting_ We copy others _

others ropy us - .. and all too, often we (fss~um(: that the people we are. COpylll.g h;w.e the "~jgbl answer." I repeat, t~}e ASSW\1'E 1};.~e are cap-wfng the-righl peofHd

That's ,eX<'l.dlYT-'\·ha.thappens when we take' s job without H~aUy thinkmgabout "VfrY we took the job. r:tl~i~k most people tlSfi,Ume that, jobs are the best 1A'<:ly to create wealth, when I'll faet, jobs don't craate hue ~lth--ioDs ~e,a~e temporm1j income: filtd there's.a 'ibJg, BiG dit~er-

enoe between the fYro. _

LET'S RE-EXAMIN.E' COPYC,ATI1NiG IH.E JOij.

Like I saidearlier, copycaJrtTng:is the most pcwerful learning tool known to hurnans, E:~t

18

-.':rvn~W and then we have to step back and

.D~ , .' ,

eXAi1l,i1U~ our a.ssumpliorisacbotlt what we ~re

~'iJ-iffi.g___'and wh v=-lo make sure copy-ca. tnnz

~"-':!f",J~;,_'f"':J" ~ .......

:fl' ~~ ;,,{d··~ed zive US what we think it will giv,e

~r. If I"" ., .. ,.... r c,r

.us. .

!f4j;OJAgnOtlt this chapter T I ve l'E':pe ate dt y

as](€li!:,~~que5tion, "Why Mven'twe JOt¥1:1d G: 'Wi:ly to:Iff.~i{lttf.l uea~ing w,e;alth?" The 3_nswer is. 'p1li~rfi~p?," (Jl?:~tl~U$-tr1(l.st of us have been dOp~0a)ttmg.the job track instead.ct the wealth cm~-,(in {tack.

Why? Because most reap le~assume~1a(a.Job

. h@~().l;1 i)r way to actualize their financial s .. F'e'Ih:aps, ~hey .are unaware OIl' arllf1matives to the job. Perhaps t11ey chm't l1iili~vc thereare othe r sources of wea 1(11. .Or p'~:r:~ps-, ihey d.-qn.rt tMlk they are capable of ',Ql'eatiI)g, true wealth by working outside the j&1i ;putine.

~wtever the reason, the result is the same.

M i _ p'e(,Jp~e become 95'}'~·er.s instead of 5'}'nr @Is:he~a;u'5~ they are copycatting the fob track. ·arla~Qreating .. tamper a rv lncome instea d.of true

. ,. I

·r.:hllt~

~ajh~bou[ you? vVbat are you choesmg tl\ll'C:;_elp,ytaH ~re you choosing to he like 9~% .or I.~~ peQpte Who. are copycatting the' job '~~aCk? ... Or are vou choosing to be like the.

_.. '-"

5% who are: QOpyc2Itti_1l:gfue ws<dfu Cl1eation tHIck'?,

ABa wise person once observed, uy QU1'" tnind is .Uke.a p:arachute_ U only wvrks whe:l1 iJ:'s optm," Today, mQ:t'ie than ever beforB, ifs ·imperaJiVe lliat W':eopEinOill mindsand become aware that jobs are a ;s;ystem f()![ in,(jom~ creation, not wealth Ci'Jea.Jiio:n.

I believe fhatifpeople ru:,e-sed.ous,about.get~ ting ahead in llle- .inste':ad o.f just getting by - llieIil :they have if) get ocHhe-i1' a ssump lions and open their .mIDas to aJt..em.ativewiElYs Qf creating w_ealfh~

I believe fha t the 95~I's- that is~.p.eopl€.' who continue to enler the do:o:'rmarked JOBviill COntinue [0' end up .righlt hack on th.e·,stneet wherethey.started.

I b'eJieVe;, however, t"ba't if we a:pe- TRULY sincere abou t getlmg differentmsrulS' and. beccml:ing':5%-<er~ 'we-need to sta.rfen.b~ri:1n;g'doori;; that will wen. to wealth crl?a,tlOR

In the t'!Iiextchapre.r we'll talk-mQre in depth ~bout the di,ff,erenceb:-etween inctnnecreatibn and wealth cr:eatj-o,n - and well. kamwhv true wealth is mere-attainable today th<ful eV~;t; be-

£-' ·l!..c' .~.R, I' .

rore mrustoryi

---

What Js ''True'' Wea1tb?

21

..

·~1

~

-~."-,.., :."

CHAPTER 2

,if,!t~()U have to tell propjey.rJ'u' ri rich ~au ain't.

- Joe E. Brown comedian

"~,"h ,hat, do, ,e, S l,t"mea.n to be we,allhy_ - ] , " ~, tndywealthy?

t:'el'tamly the word wealth means ~ lot of li;'UFfeten~ things to a. lot of different people. To me~ wealth isn't just about being able to·buy 'tmngs, although that'S: a nice side Q~nefl:~. To i:ttelfue we:tl~th is synonymous with needom.

Jjere(s my personal definition 0'f wealth - ana'l think it-pretty much captul'E:s [he bis_gest l:l~,efits Of we;31 lth:

, ' "

Wet1lth is having enough mimey awi enough time to do -what- Y(nI 'lvant, when yell' wr:mt.

BoYO'.l think Bill Gak."'S, who is worth billions,

.~

keeps hi s job as CE.O QfMicirOSQft because he HAS to ... , or because he WANTS m? I thm it's safe to say that Bill Ga tes has enough money. and enough~]rne- to do what he'Wanlll, when he wantsrbeca:u.se Bin "Gares has created tr~~t weal fh, noli" just income, In ~ wor:d, true weelth is freedom_-

W~I.TH 'MMNS PR!tlfi:OOM ro CHOOSE

Chuck ferueyis in the samef1hand.a I 'league as Bill Gates. As the founder of hundreds 'of duty~free shops In airports an over the world, Feeney is worth billions .. Ot I should sav, h~ WAS; worth billions, In 19$4,. Feeney d~ted 99$~/t> of his $3.5 billion fO.dlm.e toa charitable £t:m.ndanon. Tod.ay he is dOfi<rling ills .tirne. cmd his motney to worthy' caus€'S all ov:ecr th~ world.

Bo~hllin G~tes: and Ch:uck ~eeney understandlhattrue wealth meansliavil"l,giotal wee", domto choose'how to sp€nd.yotrrmne' ..... and your :ri1.ooey, IGates 'is choosing ti) spenct his ti.inecre'ating .morewealth, while F~ney is 'f!h005ing to spend :bis·tim;e'gl.ving .Ms fiortune .aJwe:y - The eommen detitl:nnm.atm. that e.:I'I.abl.es these twomen to make tvvo vlf!rydiflerent

choices is ture wealth; .

.sPEND 'iOU.R "IrMI6 WIS ElY

Most people-think. true w~alfuis having).ots

'24

m@1"l.ey so you can buy material! trun~. But

_. -,stpeople understand tba~ true we;Jfh ~nt..sQ :r:nUE[l about bUfibrg. rntJr:e thir~gs. as: it is 'n'b~t hu..lf[:r/K ffl(lte "t:il1Ul' .to do,-~hat YQUwaht toO

·dC.

Th:fi1kabout it~ 'When you are oM .ancigr:!.lY,

~jtti{rg.,on lhe. rr"Lml pprth of a nurs~g holDe:, labillf&flplatfng how yon lived your me .. wh~.t a.~ :yo~ -:mnsi 1ikel y tD l'\egret ~ nOot buying ;;Ii

i:nJi1Y~. expensive home? .. "" Or not spending time with yom kids when th-ey were

.I are you most 1i~ely tp repet ~rlot ¥fillEldng,around the doc};;. for mat pmmoti.on S:J&Rb.ffioe? ., .... or rtdtspendingmo:re tQmewith ¥~.",~ parentS. and .. yout_ irie:nO.,:Ei"" when they n~d_yoU?

;i:r~e Is our most precious ;e:omn.l()(lltj-.f~]'

1}]:c:lr!li:- precioustl"tan, gald-because once if St ~Oier yo'u can never g;¢t if bad~ If youwrec.k ~@. &at~ you can always buy ;;mother tar. U ~u los'eyo:u:r-job, you can always g.e1i.·ooothf'"..f j~J. If you~ose riwney .in a bad. ihv.eshne;n.t, you :t.ana)way:s. make more mQ:n~y. Bllt you can n€"~, never ·getback the time you'v.e lost .or: :pi~re'l,1. t, can you'{ Once itt s gon);f :i.f"f. gone 1i@['~eE •

~ ~:u;:jerrt Chinese pmverbsays it: best Eettr t'(;l t.htow Pol[ Dj;Vil Mr for tu n.e dmvll {}.. {ie:ep

25

well H~n ro squ(li~iter lrile mrlment rill Umi. Th<.1!t' F 'itXhy'I say true!;,,:rea~~hi$ h!3iving'.enough:money AND-ENOUGH ~Eto dewhat :You 'want, when ¥qu want. Withoul'a dO'l,:iPil:, fhe b~t~s,t benefit' ·0£ 'true :wealth is. ha ving the ~ed,()m ill ehoose.how-you Rpend ytour time.

INCOME CREA nO:N~lHE "Ji~MIE-:roR·MoN:EY TlAP

Have you .evt$. known -any hard-woddng d~c1fors Or! liwye:rs who make upwards {!1[ $150,000 per .y;ear - but 'they fed f;raPfJ€d?f\re th'ey creatiEl:gh'u~ wealth? A¢oord1!ng to my o,e{irrinDIll 'of we~lt~:,. th~" a!"nsw.,er h. "(to!"

'Here's wh'y,.EveTt tl.liOl!Ig~ many·highly. pard pf'CI£eSisi.on.ru.shave the:'mQn(~y ~q' DaY",;:l:I:'!d do cir..hat i;litey w~'ntr:·inOiSt. Dp N,(jT h~v;~:tJie JiWt ~~use they HAVE TO keep working al: theh· iobs, .day utan:cl day I21Ut IF:iL. effect, they HAVE 'fi)·~)jikhj>:"~te irtcome:~Q.they cari'mamtarn 1th-eiditestyl~s. Peopli?: wh;"Q)"are l~udmto t:heir jobs- no Ina [ter 'how mum or how ,Ut'tl~, th'f:y 'earn - aLe \~trooo...s nf inco~e:cr;eaUonr.nQt.aeaml creoJ~o}:j~

with i'nmlflf C1\ro:tfon, y.otltrade timefor 0:01- !ars!w.h:ichm~ans you 'doo~o'\Ern:]; 'lTIe-m:ohtfy until. Y0l.:i.peE,Soo~ntdo·~ work VVhret]i~t:i't:s ~J{g<lrba:ge '(,;pHeclol' earnihg themID:imum wage. of $5;1 ,5 per hour -.- ora l1ea!r't surgeon :~am:]ng,. $5,000 per .fl1!Jui - hiwme··-c.reaHo.h fs. 'stilI

26

, , ,(]I '1.l!JIititof Ume ~Q[a.t:tnit of dollars, With iln.{iQ'.ijj· "i~' (;re.ttiQn, lOh'0i1J.rs of wOtk equals 10

:h6:U~ o:{ pay·. . .. ....., .. ." .'

. Urd'€l(t1mately; -income tre.ation lS an iE!ntUess

fj:~~. Thai:'swhyJe.a1l ~n.QGmecre-atiGtIl the ~~4'r?mb~ey' tr~p. "W.orst Qfa~, :w~e,n th~ ~~m.·$fdPs"t:ht :irrCp~rle S.tOpE, ~dl ~e~s:

J o:rlkers who fall victlmeo iUflf!.~ r" or In~. ~do:ij;g; l.:!yoffs .,," . .or 'Dumont .,. are in~~;,1e5~,.

Wij~'n!ifi QurnOIEaOALS THE INrCO~E

~'sciake'-a lC\okEirta typkal "riCh"profes~~trni~, I~rs caJl him John S:mith, M:n _·wi.th ~ m1Ijifu<rl_ mtome 0:[ -$ t50,,000. Now ~ by. almOSt! "', . . .e;; So sfahd alid;:'" $l5O'),00 a"'Y~diL Is-a ]ot y .. Bul,~henhighly paid pro.b~·ssj()nals 'fuleif@medupe.<Thden'ton,their i:nr.:nm,e;s-W support tt'!:~;"~~:fes.I:y.le.s they tn:!mme un wi tt1ng;! victims rJ!t -lillit! f$:te~£9r,r.nClney hap.

ITY (itCAIL"- MONTKCY!EXPE:N$.Ei,S fOR A

~R.~:FEsSl0N,Ai. EAR~t; $,LSO;ooi.A ¥E,~

fui!:ome •. -.------ .. ", , "" ..•• -, '$ 150,000

b:(acMt. ,. , -. -- $" 5P~OO()

l'!,(l A "V, .J. 'il 0""" ",. 'It :i 00,008'

,I;'1~l;:·~l'~2l.r;.'II' .iI1C, '.,..: .•.. , ..• ", --.··--·· 'l' .. ,.... .

",~ ... ",,~.~ '>fu····· . .,. . $ ;8·,500

cll'lI.o:nlliuY .. ~1lIm - -" -. -. . L· .

I~' {'D!n[td!U1id'11I1 II\r.>:t {M ' I

'w _. _

MODl~Y Expenses

Loans ·£or 2 luxury cars $

Mortgage on Iakefrenthome $.

Insurance :~ lffe~ he:aith, car $

.2 kids in prt va te school, , s

.Din:ing·.outl entertainment:

season tickets $

2 ·family vacations per year $

C1i:::ithin,g, jewelry, fumiture.; $

Church, charity " $-

Country club dues , $.

Savings '$'

Totid mon'lltly ... ;outgo~' .....•....... "". $ Monthly.· In ,.'

. come !~! ••. ~+++++.i $

MatlJey' . l,efit nver $

. , • .I:.· •••• ~.,,~,· ••• -li ........ it- •••• III.

1,.000 2)JGO

sn l~O"OO

1,000 l§OOO

?OO 500 500 500

6,500 8,500 ~

SLAVE TIl) TEMPORARY INCOME

" . ~,~ou~see§ Dr. Smith lives a.pretty nice ~~~tyfe. We d aU love _tp have the' mDl1ey to Jo~a sw-:nky ~'Olm:try club ... to take expensive .~ld vacatl~tlS. ill Coloradp~or leisurely Cl''U~ses ~theCa:nbbean. Sure, Dr. Smith may .have a llies.tyle most of us only.:--dream about, but he's paymg.~. dear, dear price ~or that lifestyle heca!l~e he s mortg.l1ged it with his freedom!

You see, Dr. SmHb has temporaryincome, but

28·

1fe does NOT have the freedom to come and ~o as 'he pleases. He' s ~ne.~. to his job be('a~se he~sJoecome a slave to his lIfestyle: Dr. Smith Jij!.s to go to the office ev,eN-'Y day, whether he ~ants- ·to or not. If Dr. Smith doesn' t showup t H¢ doe'sn't get paid .. And if Dr. Smith doesn't

~&i P~df neither does: the morlg~.ge or the

~r loans ... 01 the credit card bitlis or the

1;J.rltio.n to prlvate·S('hooL Is it <l!fty\vooder that so.m.anypr(ifes.s.ion~1.s·"faUvictim to -early heart

a~c"ks1

A.'lltAccrDf"m" W.AIil1NG fa H~PIPEM

~.ere would the bigh-p.md docwrbe.ifhe dti.qe.lopeda.rthritis in bi"shands and could. no tru:rge:r create iro::o-me because he had to step· ~brking? More to thE! point" w~~ wcittldYQU ben ym,1 could. nolonger create 'income·{,ec.a use lOU had to' stOp woddng?For most of us, that's itbe ultimate flightin.are~

That's the problem with income creatlon--:

~ts.temP9r;.uy. If yOllstap working~ the inwme s!lopsr too. And]f yo.a don't naveany Income $t;r:erull. other fhan yOlJ r job t you 're hea.di:ngfot

tl(,sa.?te:r 1

AccoTding·t@ .B:l.l:.~:in·CB-S Week :mt'tg~ziner "It

takts the a.vemge worker half his lifetime tv pu.n:ha:.'iE a tll;nnt~J Ilttt!mulatt~ s.mn.e S~Vi~lgs and r:etiremrmt h!!ne_fi;ts. If takes about $ix monm» of

29

Uflell1p/oyment te loee it ,all.

Sca'IY i isnJt it?

FRECOOM T'!iFlOUGH .RESrDUAL ~NCOME

Wouldn!t" it be ~.at ,if you could e,njo.y. an of tMti~l@'.fit$ of Or .. Smith's- :Jifesty].e without the li~bmty of .havm;g to gp into liVOI".K if you don't want to? That would be the ulthnate (~ream romeln:.~,·w,qu]dn't it?

Fo,d:unately r there is a nether kind of i:n'Ojrn~ other.fh.antempomry ioCoule. It's celled residunl income, and unlike temporary income, resfdust income keeps . .'ea:rningmoney Whether yo~ .show up to work or. n:qtJ Resid,uatl income do-esn't fall v ictim to ale' bm.e-fur:..moneYI trap because it i;s Nar dep!2'rl:denton trn.dirrg t1nlle

f\l1Jr doUill'Si. .

To see' l)Ow residual incorne lS, {;,re'i\tect let's Iookat another fictitious professional. We'n;~all hlm Joe lones r : CPA. Lik:eJ' Dr. Sn:l.iUl!J'~.r. Jones has a thriv.mg prac"tlCi£?., ~u~ unUk:~ Dr ... -5miJh Mr. Jones fl;!Hy undeisip'od the power 0'£ residual !F1csme. For .the las,t 40 y.e.u:s .of his prosperous ·ca1'€€:I', Mr ;J()ne~, saved 10% ,of his grim income Mdi.riy:e~ted ]it wisely.

Now rEifimd, today Mr. Jones ·has. $1.5. million invested in mutual fund .... ~d,!nil'lg Ul% pee .year, whlch gives fiim residua] income equivalent.to qr. SrnU:h's temporary ineome->

·H~e.~not yS1U:1L' own

y.~'rejU5t g£!ttIi1g by

when work sJops, ineome stops

you Leverage youl"time

m01)ey grows eXpooentiaJ!ly

income oorifinu. _ indefinjtely

, ..-::~,:

you re erea ~ ..... g

. true. wealth

~tota1J:1me

freedom

you"re ·g~Uing ahead.

income-keeps corning-,in.

CFlE~l1ttG TRUE WEAL1liH

:('.!m~.~ l~k'cre:'ation-.as :oppos'ed to income c. re.f,\\f>Ci:iJ.11.J..L • for-men "'Y'

4-'.~. ·1·,;',.... 'to Ii"ml·~')d·! bv the time ... c" or-me .. ~.

<ldJ:lfl!- '.;>i. : '."'"" 1,]./ . .

3i1

trap because of i1I concept caned leverage. The only 'way to create true wealth is to.l&)eragr.: your time, iru:mey ,and effo;rts so that 10 hours of work equals 100 hours ofpay., ot-even I,'OOD!

You see, the rich get richer beitam~llieyt.aku advantage o.f leveUl~ by investing !hell; money over time, As I pointed out in my setOnd book, YQu,OH~l-StiaI Second with Your. FOfJhm Firsn

. .

:thetypj)~l millionaire earned his fortune by

,~ving20,0/iii of-hiS income and investing it wi..$ely for yea;r~ and years. That's the way therich g,et rich and stay rich ... by putting their money to work foI' them by irive'sting It over time,

Thai's th~ big difference bemieeo in.cq_me .crea tion aI1d. weal th creation .. Income' creation 'is temp~y -you. have to do the' work Or you: don't get the income, .. WeaHh creation is. pemianen.t;........,.you escape the time-fqr-money trap by putting yom money and. your time to work for .rou,

LEifMGING YOUR TIME

Now3 understand tha:t·very fewpeopIe ma:k€ ·,eno~ are di:sdpfutedenou.gh-tbdownat Mr. [ones, CPA" did and .leverage rus_m,ont'hly savings into a milticn and a halfdollars. Fortunately, leveraging ,your mortey is NOT the oruy:tried~,ul.(;I-trt1e way 1::0 create tru:e wealth.

32

-

'The',oili~~ way to create truewealfh is to lev.era~e~ourtime by iU\~'1;$1::iI1g it,.msfead ofwa8ti:rig .li;t)y

tt. .

We/v,e au. used the e:<pr,ession, Tim'e' is money,

it ilV,ei'\~t -we? We'll, due to the power &f Iever-

. "l1!... .. i axiom is truer todav than ever before l

a~.el g,J!~- '. . ..j .. ...

I~ s obvious that we do NOT all halve the same

«mount ofmoney, _ .

pB.ut irs equally obviau$ that we all DO have tlte sam?' aJUaullJ time. Now, I want you to under&"d that th]s book is.NOT about investing o~ money to, create weiP.ltb.. It's ·a:boufinvest-

'i9s yoUr time ,to create ~eaHh. becau~ ~e eq~s, money w~e" you~vest 1.1 Pl',~~lly· '. .

It doesr .... t make any ddfererlte whe~er a

p~ejS@ti. is' abillionaire .or a beg~r f we ~n ,ha:e aecess to the same amoun t of time. 24 hom'S ill .a,day .... 16£ hours ina week .. - 672 hours ina DlQnlli .• _ 8.064 hours in at year .

. ' rh:~ key to wealth creation 'is NO! crna~g nro,!e time, which is impossible, The.ke}· 1S to ta:li-::@ full advantage of the time we have,

""Moo,'t Yi(I'U :a,gr~e? .'

l:brtUlla1DE'ly fOli all of 11;18, today the~e is 21. ~y" to 1ever~~ some of our time ,(which we it'll .have an, equal amount on. to. create true WieMlli,.i:n.steador le'vera~g. our-money (which m.ost of us have v-ery little of).

FOrlun~telYf t.ociay there isa ]1";:.-yera,J3ed system where you can ~~rilde a little tillie'Jor a lot of dollars .,~ instead of a Iinear sy:5t:~m'wh~:[~ you trade a lot of time fQr little doll2l.rs..

Por+unately, today ther,e is. a $1 m p.k, dtipI~.tatable·system for l~veJ:'qging_ your Urne and efforts that vi rtua Hyan yone can. copycat,

ARc YOU COP¥lNG TflE WRONG S'(SrSM?

Let's face ~t .. mcst Qf ,us weren'f bom with the last name .of DuPont or Rockefe.ller. Wl" aren'l born~ruusesr Ii.l<le Bill.·G.atesat"j"d Chu~k Feeney_ And w? don't .naye bh~ taJe~[ of J\iBChael Jordan or; Tom-Cruis~,.

All too p;ftlJ@nweassume ala! w-eaJth (.maUtl'Ii. comes fm.m .winning the IOA>ler.y of life - if's. only, meant for sup;e.r-~t~le'nte~. people I'" or sup~-J:rI~ed peo:pl~ ..... bu:t if's eer"tillri]y not meant for tlver,age people" like you and me.

THA'fJSNONSEN~E.! '.

. We Ir!.l:~st not ,buy in to thatrine ollimi.~d 'tl-linking. That's g,arba_geftt_in;!ting, and we· n~d m thr~w tn;a[ kind ofn¢gaH'Ve: thin1Jng, 01Jl1,t: withthe tras:h, starting tight now r

The truth i"~.' that most people ,J1S"SUm.e the V can'] CFe~te wealth wfum, itt/act" t.h¢y ran) Th~ real. reason most peo,ple dol\'t create true wea]th is because tl1eY've: never peen made aware of a

34

»

NOr. KN:OC~ING JOBS,

r:lea$e understand that I am NOT knocking icd~$~ I~ knocking t~e RESULTS we ge~. frnm 'wo~Ri:ng a ~ a job. If JObs c.reatedltrue _wea nil, Fa be··the fil&t person to tell you tID follow the jdbJttac'k. But the); d.on~t-thaf's·jus'[ the cold, loo:d re,aUty of tt alll

C~PYc'A1F ExPONEtffilAL GROwrn, NOi' llNEAIFI GRomM

''fiutl'lI is, youwill never create true wealth as long as you are copycatting th~ inc~me i~~tl~n 5.y:stem because it's ba:S,~d on l,me·~1' g~th. as opposed to wealth creation, which ts

~edion le.veraged grem)th. .

lh the next: chapter We will take a d6ser look af 1m, limitations of linear growth/and we'll rd,~;quss why we need ~6 st;art copycatting }evela~ed systems if' we are sincere abo~~t ~~Q~g,totally free by cnmting true wealth,

=

Linear Growth 'Iradlng'I'ime [or Dollars

-

I...iu.cw- Growth Tradi.og Time. for DtI,llars

CHA,PTER,3

Wf}1'kaU d!;lYf

- LI~!e m~ hay, Mlen UOIi die,

"

Pi!'! in Nit>. sky,

- [oeHill 19205 union organizer

I t5.~.~~td.: . .tcll people in. ,my s.€'lnil1E1r~.IDatm_ost . workers are on the 40/4'0/40 pbn-the,y -woiR. 40: hours a week" .. for 4,0 ye.:rrs '" and tk'el'l when they retire, they get a retirement dl:nt1et and ~r$4n watch!

, "

B:U:t ~.(ke 11 lot of things in OU~.· fa~t-Qh2l>I1ging ~v~~·.kl, the 49 j 40 /40 plan is "011 tdated. T oday IDOSltotus al€ on I:heSO/50/50/50plan, Nowad~y5i\NC work 50 !rOILY'S h :week ..... 50 weeks tl 1!tf'Jlr- ,. .. ._few 5D YNU:;i • __ ~lnd H!~'n r~'iin: on 5tJ%

(l_fivhaf we can't H1.~I..:' LIn rad'l.ljI TjM'~·FQFl·MONEY THEAUMlLL

f Th~ 50 ~ 5D /~O /5'0 pla n is the cla ssic .example

o. incame creanon because it's ba .• "J. '

Oro" t! Tn' seo On linear

... W 1. ·e math to calcuk t . I'· .

ln .' . ',' it e meqr growth

.• come IS very simple: .

H r!raw:hn.<:oag") x N (, r'

_. .' ~ . -. ,.w'n(I(Th(jm·~ -un '.~ d, -I (.

, - [ ,rile )._ . mcome)

The definition of linea;' is "ther '. -

Pro . .ti I .12' outcoms rs . pOI 1011 a to the lnou t " In 1'" .." "~

'I t :r ,- . ",,,rman,, terms

l'la means yo t .c J' I, . ~I'

.. ' _ ." u ge .out what YOU put - _

nothmg more, nothing Ies J -]j .... _ ; . ill

'orowI-h x-r- ,' . _. . s, n .nearr mcome

~. -, Om: urut of time e>ql 1 .... .

money r . , As a "",.,]_1~ th 'l··la .. S one. unit of

_ . ,,,,~,~u L, . e on U' VIa te ;.

rncom ., b _ J " J. Y 0 l11crease

.e aSeu on linear grmvth .~ to " e

ho" .. . IS 0 vvo-rk mOre

. . un:;; Or get a raise. . . I

Now at first glance. tine' :>' ... -. .

Pretty £'.' -. I'. _ . . ar grow l.h seems

" l<'Hf_ . t rewards ICleo, J. wh ' ' .

O'f d ' . r P e '(,\' .. 0 ar.e paid a

c. »0 noudy· saran.' .' id ,... -. . <.

h . " . - <in all e willl ng to' e ! t -

t, {' hO, urs. But the probl om wi ths l_.~ .. _~ pu 11.1

_ .. .. ,.... 1 1. wor~ $ ea '.'

mg 1 nco-me based 011 li . !TIl-

t bey' H alwa . 1 - . inear growth is tha t [.,..,',~.I-.~_ h . ys rave a cap on their income ..........

• L-.1I.H<::JI. . O'iil' much t:1 ' £0.'-'

. . d nL'Y earn per han r.

THE PAJNTffi AND lHE PfWF.ESSJONAL

>[0 best :i:llu~trate' the' ]jm:i.tat-" ,,'

gnnvth let's I k ", . Ions of linear

~ . ,. on· a E two ac c ~

. -' ( qUUlrLtat1(cs.of

40

wi£.l~' '·ilh two very diffe~l:('nt occnpatlc)I'Is-a fluu§~<rinter .and a doctor.

palin ter' 5 na me is 'Gary, and he ownsa

~.ai"l:clng and wallpap ering business near ~:t~~me.m Clem;wab:.'rfF~()iri(lia; Gary. works ~i{ii'. He's. on the job ,early and he works untit ~~~~_. He wor k s weekends when be can,

Vv.:hen. Gary bids Oil t ,il fob, he .figures his rate adil2. per hour. "But after factOl[:iiI:g in travel -IJ;i.fflel rrlps to the hardware store and so. on, ii!.'trp1"ohably closer to $10 an hour. If Gary is

jbu:;:~y·enol.lgh i.1Q work 10 hours a day, siX·.days .;~ek, here's \i\lD'lt he willearn in. a year:

;L5{~lO.=- .$10 per lwnr

tlitrhours.per week = $600 per i.dc.e.k. 5tH-¥eeks per year = S30))OOpe-r ytJar

Nlt).w, $30,000 pl."r y,e~u lsnothlng to sneeze 0;t.$lQ~ of peQple would love to· make $30iOOO a-0'fear. But that' 5 the most Gary will gross in at wW~ar, when one.goed job follows another, Bnt loQk 2IIti:h£' price Ga:ry has to pay 'for a great

4tl\~f; .

V a,e only g:ets to spend one day a week with his wife and kids-

.; He'·n never make more than S30,OOO a jieaf', no matter how har9- he works.

41

/He seldom ge1:$ time .off. and wherihedoes, hel9 too 6roo (di too ·hmk¢) to~f'tjoyitl

,,/ I -Ieft/ s the wor:sit: part. ITff working '~for income based on linear f;rowth ~ Gary only gets paiitW£J!/br the ~vo:,.,( he'~Mloru!, V\lhlch meMt5 ones h.e gets his 1.:':1$t 'Fa yci':eck, he's back on the time-for-money h:etu1mi]:l

iPHOfBSSlijr~ALS: NOlHtN'G MORE lfilA~ H rGI7I~PR~C!ED :HaUSE ,P~~r:4'1'!R:S

Now lef s ,go- back and -. ' rev-lSit;_] olm Smith, M.D. .. who. earns $150;f1iG'O,a YBatr in 'h~s Uledical practice, Dr. SIUi.th is a. ge:oe (OJ l practitioner with his own priv<;I!te practice. ,'\lfh.ouS11 bArn of hifuhi~l;r ·ftln~flh.le !p..ffi.p.!oyees iW~ wgisn2l[ed J.H.US€S, Dr- Srrdtf1 must see his patients in perso.n. SoJ:re works d,ght hours a day~. SlX: days <I wee>k attending to. patknts .-. UreR spends hVO' add rth;jhal hou rs a, day .fim.:ng out 'papC'.l1A~'()tk . _. and spends bw't}S unda 75 of each 1TIOn th .. on business ma tters,

The only rNa,), De: Smith G.U"l increase ltis in COIHJ:' 'if; by i.fl:C's'3 5Jng Ids hours. Bu t oecauqe ,he'\ 'Zllr~ady working lO·houfS a Jay, by the rime he gets home .he's 1:00 exhausted to ll!Elp the kidrs with homework ,oraH'emt his SN,r·S

AlS~~'t9>HI$ ",~pB

. "",' .• ",. ~'r urn lith mirk,', e.'S. :21. ]i)t of mo" nev, But,

-,Lt~? ,13' ' '~'~''"'' ." . '. . , > •

fell" ifi he's a I\O-W, ~a PrjB0rt(':.~r Of

m " .,' ..::II'H·' f t· l d

~Jf;k~ ~tr.appeu . .' e.s ", r:s. tla,e. '."

:a~''''' ;rnppy ,., hut he doesn it Krtq'W

,'". 't it. So' he ju 5t keeps6r.o.inr~'back

j;;;i:fGl; ~salf Hlines, 'i:Ttlding tIille for dollars, _ m~gs will get better~bl1tb"'loWtrtg

_ r "'"'" .: ~ , _.r·1

;'" . rl tl.,ev,'woJ) j',

..lI:I IL, ;-~... .r ru ,--.

nj;@~ th'*f>wbJem w i+h income h ased (In

'lit~hoiEQ:w~ll:-'if }TD:u'n", not perS0:ik.fUy d. qil'<g

J ,~~- -. I

~b;e t~~e.u;~~, Ulil. WD rk d0~rl't.gct (lQrie lf th e

"";&~'~~er~.snt [. ;t.>e,t done. you don" t ~:):'l oaid.

~~a~i'1'~.'" _' .')/iJl I ~ ~ f"

Aihl:t),fi!,fi:l'dy ~.,~;t: to get paid is to k~:€p doing tR.e ~s;w~~k .o v er .and over again. I If<3'il'E!n fnrbul

F~t-er (Yc the d.oc~mever. g.eL~ sick UT in~ , I~;i'id'" t~~.·(t~g.o W·wark!

WHAT J;Q8.S:'YP.U~. TFt.EAnlMIU .. PA.Y'?

. W.h~:t' ab(mt Y-OU::-i!ile yOll on tlw dnw[fu1:'-ln~~ bel;! d:rn f i l? lf ·~s.o ,]:to '1Ii£ m uch does

~d.'tt~~fID,m p:ay? Bftl{)w is a irh't of ()f(Up;a:.b~n8 ~'fI,j their <1 lfi;:!r"1g,e Y'ea d.l' salary l as l'~tt~t:i by Pan~d? M<!1za;:::i:-1t in its. "m'i1urd f'e'~!1'~.·~-~"~dl PbJJlk EI~f"n< ,u Take a look ~~r

how your yearly compensation compares to other occupations:

19'6 A VERAGESALARJES FOR JOBS IN liSA ~ ,

Occupation

A nnual Salary

Hospital. [anltc ,, " ,' $ 17,00.0

High School Teacher $ 3:3,.:.lJ.o.O

Corporate Attorney ",,,, , $ 85,500:

Secretary _ , $. 16,OQO

Sales Clerk.i,., s 10,000

President of United State-s .. , .. , $2.000,000

Newsp.aper Reporter $ 32.,000

Travel Agent $: 28,000

Physician., ' " :;,,, $J41,000

Minister. .. , , , ,""" ".,' ". $; 23,500

Aceountan t •. " , ,.,., $ 39~OQO

'Vere you surprised at: how jl0ur income compares to the incomes of other jobs around the country? Well, you' re ill· far an evenbigger surprise w hen YOH mmpure your yea.dy s;;tlary to the com pensari on for a CE() of a 1 a:rge CO;Jl"IpanV·,

just take alookat how CEO pay compares to U1e pay of.an average worker in 19%;

44

_ . (i" ~ ... ,'D BETWEEN CEO .A"ND Wn(tKER..~

... A: .• ~ ($""'-.. ..,

u_, •.

f'9.96 >CEOpa,)' '" $:3. 'i' miUioll 'f;f.m~:,ker pay:"'. $2.{i,OOO

m;fu) '" .l:E17 to 1

lSD' t #:'~ai.ing how one: person at a tom\'P~ ~ ~ be T.¥O~th $3] million I while the rank;~tl.:mt:\\I!:~ovke:r;.at the sa-me company is worth JQru~ ~2P.n~)!i)? Iio'[!i Lan that be? You I1Uty ask Y'O,¢(aeU.

B~I;lo.J'3N~JHE TIM.e-FOR-MnNEY TRAP WITH LE'JIERA'GE

1 ~ ~a$Vlfer yo~r questionin one word-> liEV6f§A.GE. You. see, when a typkaJ worker 'ltatlaslt¥.i titnEdor dollars, his income isgrow~iiw a linen fashion. 'pne unit of Hn11:' equals. "(:lrremitof':jlli;:mey_ TIre worker is earring 1000/0 ;pf h.iS"mlllll, sineular efforts.

. 0'

TR CEq:on the other hand, leverages his

46.

time and talents fhrough his employees. Instead of gdting paid WCJo/~i)f his singular effo, ts, he makes a percentageof all oCt' his employees' efforts. Tha f s what)" Pau I Getty was getting at w hen he said, 'TrJ rafn.c?1' earn rx} of :rbOm(n '5 efforfS ratht'7 tnan 100%, of lny moo," That's why ~everElge is so powcrful=-ycu earn a Ume ~:it from the efforts OF a whole bunch of people:

A d essie .example is the Hershes candv bar"

~ ,J.

-Hershey's net profit on each candy bar 1,5 only

a permy or two. atmos). Bu-t they sell billions of Hershey ba 1;S worl d Vil ide each and ,every year. Tha r s why the rna kers of Hershey candy bars, ,Mars, Inc, 'i :,:,'able to post prof ts ofa billion plus dollars a ye~r, year in and year out, Arrd that's why the CEO of Hershey makes big! BIG bucks!

THE HERMIT AND 1liE 'DH!AIN SA'W

TIle ·"on(.8r t (lj leverage IS iike the story of the hermit and I.h:e chain, s<tr,\". One ria) an old!. herrnlt c-a me down from his cave in the rnsnnwin to buy <;I saw ,at the local hardware stora.

"! r til' mDFir:' out (If n~y cave rmd lmi)Jin.g m_tj'selIn IU:',L"u Jvg flume, ,. the hermit pIOU&Y armounced "0 the- YGtmS"sClles clerk. "1 nerd the? best "f{cil yin, gat- ond.pm» L not aN ail;' ieci. "

46

THe' '6t ~g:~~e'S clerk disappeared into Hie _ ~(]Il:lsd& a,IDomcnt before returning with

"I'i~ 'h . . "'Pl." 1 b -

gj - new c:" am sa".\~,. 1 ri i.~, 1,::- t I'~~ r es t saw

a;J .th,~ - ,F.!' the sales clerk 53:id C'~nn den tl y ,

ISlU, ' "' v- , 1 Fj_~ I_ ' "h 1 l.;

~C' -tl"u .<I.'ftUhttrn t,rl 'trees ~ hu::: a J(iI,1je t· rtl~~:;;11~utter,

.~ II. ~,r;J:..p ... II;;'. . Co 1.:...

1 ' it,win roh~ r1rr}11.Ufs w,r)rtrr of lumber

j11,~ , . rIl'pe1'[I'Of1fJlly refund your ,mom"Yjrom

itt!lp!tjjGlle?[kt:. _.. ," " . .'.'

TI1€ excited hermit paid theclerk, .grabbed

j1}. _gl@&m:ingn,ev.rchain saw hy the handle and hf#l~e.ittbaJ:::k np the mountain,

[%tcdy Qne month late!" tht:!"Hng clerk ~ a~ blLYs~ 5't%tlldng she~ es when he heard the n~t'~li vpitc,.;;;:[~ck thn:lI)gh the air like ~ whip" ftti¢y,S$'itrly,Ivl' I~om~ hJ refIlm lhis sa'w I4ndgtt 1t11l1:lllmclY lmrk Nh- yo l'1n'qm:s?d, '.

'~'Fhedf!.1'rK looked uF to see the. otd hermit-bl~t ;'I'~fa~ shocked at what he saw! The hermit k-oked t1:ke,he-liadn't slept in "",ee.- _ :-~ ;:i!'"'tnf's we.re--S;1u;!:~aded and stained with blood and sYV,p"k He looked like he'd beenworkedhslf J(l~1~h-

., ~ll-~t~Jh-1:i:thaf hrIp~m'?L'd ~~j y~lj'? ,. the clerk

"l"tan1'8'rered~ "YOl~ ID(~k tf.'rriN('!"

~ p,tl Ke'rn1.! t summoned aJ I. his _s.tteng'th ~JjImd hJ:s '(:ha1.n SiJW onto ~hC' counter i 'grumbhJ:!S "it".:!; l,}rr:;£,rl(ldbum 5tlW VO!I soicl me. You '<;Il'iA, i't/rt ("iii ~,tmmHr's 7H"rtl~ (J-( lumber in [l r;tfU(_ l>\"e"· rv;" ~!!~r'l usins: {flis (;(11, !l':rwtitm far ~[l d.-?;;s

<> r •

47

._._,. .......... Iii ft,.J"1II IJ "_,

noto, and 1 ain't alnr been able to cui a· dal!- 's toorth. ojlumher in Il month. iutal1i my. m(mey h(1ck~ "

The startleo clerk apologized and said. '''Sure, adea! is {l deaf. Jus.f hd me have (l b)(}k.!H iMs "SITwfo.r yO"tL Maybe 1 C.an figure oUf 71Jh,i1't'S 7IWO~t.?_ "

Theclerk gave the pull rope a quick yank _.'and the chainsawexploded into a roar____::_"B-RR-R'-R-R-R-R-R-R!!E>

TIle hermit jumped back from trl'e counter like he'd been shot, shouting uver the tearing saw) 1l'W1I4T's. TIMT.sOUND:?"

.Ill LESSON: A&O!IJf LEVE:A_AGE

Cam you imagine 'h~ying to. cut down a t;~e with a chain Saw that wasn't even turnednn? No wonder the hermit looked beat lip and worn out. TI\e story brings hO):11e the POint that leverage is an awesome tool.but only if we .pu f it to use,

The chain saw is. obviously a gre.;lt tOQ~ .for lever a:g,ing time and effort If you Eve ever .h'~ed tocut up a big: tree li rn;b using-a hand 521 W, you knov exact ly "'lhal I mean. The irony qf the story is the herrm thud in hili ·hands a powerful tool for leverage. He Just didn't know how to use itl in otherwords, his failure didnt I{'suli

i?1 . .",. a ka..t.k of .talent or .effort. Hi's /aii'I .. re re-

l_<L,D~' ,

f1'rlted 'rum:iL laCJ,·oj knm.viedge I

!If.l' sn besai f L

'Tile: sa,r.n.e- Gf.'l!fl . e sam . or LU,e average per-

sen- ~~ the power of leverage, we can a.~O: " ~.!ir goals ilia fraction of the time w}th,p::jfr,al\:ti@'n of the effor't_ We can, In effect,

elit'~,rriqriijiJ'i' worth of lum ber in Or day_'" Bnl' i!t @rd.er tol~'lk~~full advantageof leverage, 1,\ I"

. ,~ leh.a'lle i'he:knowledge that it exits, Ot.h,' ,_ lI'lfS~~ WttIl ¢i1d up like the hermit-e-wc'Il Sf 11 tritG,~:.ihead w~rkil'lg .'mrdu trading time t, -r dQ~~r :~tead .of work.mg .. s marier by lever-at: ,~";;"'" a.·Uc :rnne and efforts.

..u.'~I"" ~7. .

I'srt't this why by age 65, the EJ. verage perwn

W: desd --. dead broke ",' OT d~"P~denton

f1Je f'fajnily OT church-s-too many people

am ropyca tung a linear plan instead of a lever-

~~gpl:kt? .

K:NI1IWLEDcGc fS lHl: FrFtSI STEiP

E!'~ ~opymg the right kind of leverage in the m~hf sitUation, we can move mountains __ - MId "'~:I!. ~ ,nl:alte·m.Hlieri1s,

l'he! question is, "Wheal sysLel'll Of wealth. ere-

atm"n· d(!! 1l0lt Wfli1l. 1.0 t:f'JpYai t? ,~ -

~y(1J;i want' to continue to tCpyc'qI: t 'the linear 1?}!SIflil): oJ wealth creation and end up like the old Jttermiti; It-9cding lots.of effort for vt.>ry littr~ retlli'itlJ:<

Or would you like to be like the young clerk andlearn how to turnon the Chams2Lw'oHev-er;_ age?

That' s wha 1- you will learn in the next chapter-proven 'Na~"S 'Ne.o[an1~\"er<l.ge·oL.li time and efforts 50 that we; break out of the time-formoney trap~FOREVER-a.nd clalm the flnancial independc.tce that we deserve,

50

Leveraged Growth:

W<Olrldng Smarter, Not Harder

51

Leverag,ed Growth:

~o.r~g 'Smarter~ Not HUl"del'

,ns.rwf eml'ugh to be busy; so lre the mas. The question is: 'WJiat.are W'e' twsy.aiJ'fIu t?

- Henry David Thoreau

IR AUpt of 18SS,an Atlanta dn.l.ggistby , tli~'iilame of ASCI. Candler paid $2,.300 in Msh -:Egr th¢-£xdusive rights to i1 carbonated IabJ:i:1!.; :in drink called 'Coca-Cola ..

Cpm~€ula was an immediate SlKCe:$S t n the <A1:]M.t~a~ .. , an d by the turn of the century vj~lly.ie:velf'Y dI'q.g sttitEdn the So uth fe;:lru.r~d a ,od~ .lomIta-in where a custo mer could sit "clown at~d sip amid Coke fDr 5 cents.

Il~lTC(ffidler made a monumental decision tl:t"atw(ll.ll1d transform Coea-Colaftorn a small

54

55

.r-egiona! company into an internafionalhousehold name. Candler deefded his company could ma ke more moOney with less timeand 'effort by introducing. a unique form of leve:ra~e--- b'ol!'ling!

COke--(lt YOU bad togo iv.ifbout Before battling, Coke sales wuld'only:gtow till:; l.he number of soda fountains gH:~W-

Eo ltling_ ell anged an tha t, The consu mer didn"t have togo mt:he.sod<Sl fountain to t'.lljOy a Coke because, m affect, when ~'i consumer bought a six-pack of coke, the consumer brought the soda. fcuntain horne with himl

As .J. result, today virtually anvone in the world can enjoy a rel:resltlng dj'i~k of CocaCola in [JlE': convenience of their home, anytim~ of the day or night. All. because the Coca-Cola Company had. the wisdom 1:"0 levera,?f timet effort and lcca tion by bottlm.g their product,

THE SECRET TO COK:E'S INTl:IRNATIOMAL. SUCCESS

There's 21. fascinating story behind Candler's decision to bot't!,e. coke .. Legend has it that a gOQd fd(:'nd bu [:<; t· into C?lmller.' S office one day and Fl\)CL!irnt·(1 that, fora hefty tee, he would let C<lnd!(or m Ch1 tbe socrer for·vaf>tht ext-and-

ing: C }';:~1-..:o1a.'s profits, .

The rw l~ men bicke red back and "forth for a good part of the day umil C~ndler's cudosity eventually gut flit:' best of him,· and he Wrtlh:> his friend a check, The friend graciously accepted the check and t!R"'I1 Ieaned forward and whispered in Candler's ear tV\~O simple words that launched a g10bal :dynasty: Bonlt' fl.r Forhmately, Candler had the vision to take his friend's advice. And the test, as.lhey say, is

ruston;:'. .

WHAT ~S LJEVERA.GE1

LE:VERAGING TIM'E AND LOCATION K,I tit, it!

Just think for ,(1 moment about the POWt'fO! these words. Bt'fi.:l'T€, Coke carne-in boUll .. '!'S, you had to goO to til e loca J sod ar fou(1 ta L n to order a

The root word Qf leverage--leu.er-aomes from an old french word meaning "to make lighter," 'which is. an apt description of the power of leverage. By WISely .. Ising certain levers or tools, d:ifficnlt tasks.can he performed if} a lot less time with a lot less effort, thus making them, "lighter .. "

Consider the effort it would take 1:0 replace an.engine in a car without talQ"i\g advantage of leven;ge_ How many strong men do you think ltwould take to lift at1£ngh:l(~' out uf your carS ?'10 ? More ?

Now Ehink about how vour local car mechanic

-. .

I._..

- ,-....-.. £::..., uut he krI,e'>".' he'd only be

· .' f th~ p:ro:IJ.,,,,- ,I.>. . . T kin

-1,-;,0:0/0 o. -. ''''oJ''' "' ... ·,..h .vear VI,: or If!.g

"". • t 'ad a em" or .,,, u ',",W ... ~. . .'

~bl~ to bUl! ., t 'etiou-gh to lev:erag~ his

Sl~a. Ford waS' hbrna~" "'hi ng' bts emPloyees to

- .' _~)J -len.ts, I·Y u;:u ..... · • L

tlif\i~ l;l:tl.l,;l ""'. - ·B. . t . k·tng· adv ani a ee of b_le

"' .. - 5Y· ~tem ... - y .[io.. ~

{;fMil!rTcat biG '. F' db Hl: thousands' of tars

'"'Ii' -: . flevera.ge$' or ill .. .

"N€r·O" ~ l!... ,rl'IQ on€: 0'£ the nchesl. men

~ ~h,"~i' ',~ ... ....--a:n.u l.ecaU','"

et\0Jl 'f<r;.<u

ID. h~sbory!

, '. SMART" SEWN,S, !REAl.. ESTATE

G'ETlmG Re:Jl,L . , , ki

· _ , - _ have been ta ng

t ·te CO m.naJ1:1~!9 i''''' ",. ' ,

n~ .... ' eS a '. r, , ,: _ ...... s

1:'><:;.",:1 ." 1" "'or,.e' ''-'Qllcenrl' tor vear ~

.. " . of the everOiD .... .' t- • •

_aEtvanlage. . .. ' "'mplO'fees, a r~rutor.

- ,', d of lcveragrng I: ~

but ms.tea ,( F irldependeut COI'ltradors

:1".'.- 'e5 a team :;1- .

· ~eVerag ~. . n as' real estate agents).

~betl:er ,krlo,:,' t<,'hOw'" l'l"lT'Iod'leticB.LTN, 1 esta .. Ie.

. 'loOK. a " u 'J r , . h

Let s . ~..I.T '1' ."., le't~a.;:r·e-toma.e

_ 1 - . ~ . e~ us,._, I ~"". co

proie6s:lotill- ':aTIl, .'. 'lad bas been selling

. V 1i1. less tirne. , ... ,

nwre f\1Qne. , ., . so When he· hrst

"c' " fot 20 'V,ears .. or ~, , . "

.. """1 estate -, . _ ~ll e house a

. ""..... I I_'r ~.,...::;c..L on· n '~""

.", - -, .' t, he. wa~ 1JC;l<..) ~"". . - , started ()1.1 .' . .:'1 ed. vot better at his

_ B.lil oy,er the.years C1 . ld

;month,. il._ .' ,Co ' ~. ,the busmess, be wall.

'ob After five yea.rs 111

J, . . " .' 'ileaI' on average .

. - uso houses a J' . lJ-.':1 ·tu.~~'" ~ CI~J ' _ I, h' ...._;j T,ed WQrJO..t;~UJ I n,[KI

- atte'fl"l!OW CHu '.

"But nO' ff1, . ,_ • ,.' . ,11 ':"""ore than gnE: hOlllie

.. ible tor hWI1l to sel", . " , -

nhpo~St., s: A a.,..-. U he could. only$l'low

. . ' J.-.:rosclJ- /"tilo;:;l a. r J ~. _ •

a ~"eel, b'l1 l.U _ , __ '1 .. ~ - _ .:l.- (Yo""'" 50

.yo< .r;, ) '. d H " ooWu. {1P.J!.'; 0 .,_, <

j'lOlt..<;eS, ill:a: . ay. ,e ','" .

51:! many : ,. _ T ",1~ c..-..he cicd ded. to open

'. d~'''1n'''S. m a v.; e~'l1'.- "_,2U

many CLV" tI

. Q

could perform the same t~sk in a fraction of the time with a fraction G'! the' ·effort First he' d position a well -oiled hoist Gil a sturdy beam above the engine. NeXt he'd secure the engine with ropes andehainsattached 'Uo the hoist Then !1:f{d·attach the pull rope to an electricpowered fly w.hee1.Wi,th a flick of '81 switCh, the engine could be :iWted 'out of the tar 'in a matter' of seconds,

That's ·the power of lever,a-ge__;j_lt Increases productivity by maximiZing time, effort and money.

H'owCORtPORAi10NS USE. tEV,ERAGE

For centuries enterpriS]ICJ.g people have been making thei.r jobs ,"lighiter" ~that is, more productive and more profitable-through the cancept of leverage. That's really what increased prod'l:J:ctivity is aU about=workmgsmaeterinstead ofharder byfindin:g:.<l way ~ make a lot more money ina lot less time.

I-firing employees is the most obvious way business owners leverage, their time. VirWally every major (lompooy in the \'tlor1d---bom Ford lI.1otor Company to Sgl:ly------starU:-,d off with a sole propnetor who leveraged his tiIl!l.¢ andta.l.ents through employees.

. ; If HenryPord, for example, had. built the M¢Irle1. T by himself, he could nave pockered

(mtJific£.

Ted !',eeruiterl. same ofhis realtor friends to work out of his office. Over the years he assemblfed 2Q. top-.notch real estate agents, Each one at [h~e agents sold Sb.house's at vear, which meant his office was sdlL'1g more thcm1.(XJO hOll!SeS a year!

Now1 just look <If "'ihat leverag,e has done for Ted. On his own, Ted 'could sell 50 houses. By leveraging .the time and taIent:s ~f other ,agf2Tlts .. , Ted could sell lA.Q!)O ho:us'es-wruch would be io:possibJe if 'he were still worJdng alone. By usmg levcl'ager he is 20 fimes more pWducn:vewhiJe wvrking reViler hours. ThAt's wh3:tthe 8X"rre~s,jon "u.}(JTki~1g smarter,. oof.hal'de:r" is al l ~boutt

LEVEHAG:INS THRQUGH FRANC:H!!SANG

Frandrismg- took the concept of leverage to an even higher levelfhan a reaI',E'staw office. Although franchisll1.g has bern llr9llUd £<)1' yea~'S, it wasn't i"t.'Cognized as a "Iegiti~atel' butSID(;''SS concept until the. early 195'Os; whe'n 11 ~ljlk shake applil3l'1.te sale:5inan nam.eci H:ay Kzoc bO'l1g:ht the fights to fr;;mchise a fasf-fo.od restaurant: ca J led McDona Jd's.,

Ray ~r0c didn't invent franchising. But he sure per fected it. Kroe undersfDod that the kev

._

58

to a successful franchise was du.p lication. So he wept i<lbout st:>fting up a fool-proof system that spelled out every detail ofa successful franchise. He even went ,<;0 far as. to spend $3 mil-

. . .

lion te research tb.e secret (If consistently perfed fre~~'h fries.\,\Tb,eu someone bought a McDon.ald's franchise, all they had. todowas

. . .

connect the dots, it was a copycatter's dream COWJL' true!

Think about this-when you enter a McDonald's"wher'eis the french fry machine? On the left, isn't it? It doesrr't make any difference whetherthe franchise is in Moscow, Idaho, or Moscow, Russia, the french fry machine is on the left And. you better believe

. . ~ ..

every other detail of the opera tion is spelled out and in the right 'place, too,

DUfillCAT!ON: THE. KEY ro SUCCESSFUL F'RANCHIS1N1i

The concept ,.of franchising works so well becauseit is so sUnp!c'''-brillianHy simple. It's 21 classic win /win situation where both the franchiser and the. franchises come out way ahead,

Through tria,1 and error, the /rmu;hisbr de v ·elQps a duplicatable business mode! built around a ptoven.product (li.ke Domino's pizza.) ora needed.service (like Kinko'scopier service),

5'9

J

The key to becoming- a suctessftll iraIl.chisor is to develop q SLlccc5:sf'lll· S}"Stem and then :record what neecis to be' done in detail so that the model Ca..11 be ta ng Itt· to somebody .else_

n a .. mode! is prcnien and can be copycaHed by the arV't>rage person, then it ('lUI be SUcc.-essfu.ilyfrartdli.scd_ If, however. the $uo:\:'ssufth~ tnodel depends. on the tJilent of a one~in-a_ miIHon "star," then i~ can r bes U cCiessfuH y franchised hecause the srarCitili t be duplicated_

"STARS'! ARE Nor DUPL!CATAI3LE

The reaSon .the actor Tom C-nJ:fs·C' Can COin rnand $20 mi1110n a picture is beca U.Se he's the e&seru::,e·oi a star. In rrol~}'wood terms, he's "bankable." Vlhen 'fomCruiscstals ina movie, it's almost gU(1:ri3'n~eed the movie wi!J make mQ'1ey:-_ BfG mrm.eyJ

You c~n't hO\-'{f;ve.r, fr4nduse the product ·"TOil'l Cruise/' b:ecai.ls.e he's not dup4iGatable_ The !:In:~rage per&m Cttn't COpy what: Tom,Cruise does and expect the snrne re:1::iults. That's why you can~t francMse creative endeav0rs,!ike ""riting 1'l best-Helling book qr -Singing a hit ;otlg_ B(~al1sE' they depend on the star .fadCH, :11ey are unique and can'L be Copyea:tted.

Senne products:ru-td busiru~sses, hOWe\.>er. <ire !3'sily dupllca taMe. PiZL<1 is the perfect 'example_

..] tihd andfnexpenstvs, 'T'hB'~r;edients are P .. er:. • ., 1'" ""W our a P ,e:rred

U' . ,keg a fewminutes ~v ·L'" ..• . iah It nIy ta . . ,d _., tuallv .anyone ~Tl ~h a lug

;:a'tld An v I!l'. . .I " • g'~

PIl'UUL·.' • • . . _. Jess) d a desireto , ~.

. 'if':'11 ducation (or ess. an _ ., I

sdiPp_J· ~. . . ,. ., ~ the franchise mode,

' d an lea m. t10 copy,ca. _..._ . _

abea .can - " Let's face it a fran

" "·HutorQuffi.!fiO S-.' L.'~, -I" ,D.

w. R.1Z,' za,' .,.. .'... be , ocket sCle.fl"tlSt". Dut

f:~'...- . doesn't have ID.B d. roc: . , f

f.;[Ub'ee - s ·h· .. , to be-a great copycatter 0 a

he does: . ave . .

~toven system.

:~OM.'ZIEROTO HERO ..

' ·f ·1 .. ;rbrOl,omg time and

D ,. the concept () . e' <::. ~ 0 .

~ qe::;... . . ,. .. . ,]j,tion work? Toanswer

manej,tfuough ... dupca. . ',~-' .. _. Iook a ,t whact.

. ,. ll vou have todois .. ,.

:.that question, a you.,. a .•. " _' .. .. r the last 50 ... hao . "e.ned to- franchising ave . _ ~ . ,.. _ }_ .. h~-.s .. 'Pt:.n Ra.. Kroc started duphc"tlIl? . 'lIs 'lOI'ea_t"S. W. r'd d Iranchlsinz r-: . '.-. ,·t, eoole oonsidere ~C<, _~

(l)perati.'O,f!i",moo: P ;Pd St· t. 'S Congress even

iJ . . "The Unite ' "a. ~e . . ~

a.·' :sca.m.. .. .

tried to outlaw it .' .. fIT _, clrising has

. . .. .. .11 the perception 0 .w. c:

Ironical 'r t" , '. ' . ." . ' .~h'.e earlv day. s.

d .. fum smoe ~... .. I

ta~ .. ert a 180~ e~reeh· .,Ji,." t:, dav ~vV..rhere hom

E ' , estimate t ,.<t,t (}. ~ ~ _, . •

:xperu. :' , ".' ... ,. . ds and serv ices m

34% ·10 60t>!o ·01 .the goo. hr. . h franchising, :., .', "1 distributed tt oug". _ .'. AQl~nca at~.. ..'., .. 11 over' the world are.

,and s, avvy l~,vest,o 'frs~all· rs for the right to pra}1ng mil hans ~ .... ~~ ,l_a, _

,. : ... ' tauroveafranchlse, . ..

'.oopye:a, . p... ,l...~]... ir d'f.,.o"..-;:".b,l;sin.g·'s pheno:ll!L,'-

'b ·'·11' ce [l'\:;J,tlU , <c.u.,.._~.. ,. . _

The Ullan - ' t . f duplication

~lla.l success is the concept 0 .

. 61

{

through copyca.tting. 11€, dowmi~.le to franchismgt however r is the start-up cost Let's face it, V€'l'y feVlf people have a million dollars ill plunk down For c: ~l\~1tDol1al(.1's franchise. To [~moIiCO'l~E> matters, ;~ou must own and operate n~tiltiple franchises to become tr:uJ'y wealthy in a franchi.S€ s Y51em,

THE Al.JEANATlVI: FHANCHr'SE::™ THE Ul'I1M1A TlI: COP'veA r S'r;'STEll!

_ SUppOS€' then" ~12 iI franch:i:se-type concept WltlJ a very affordable start-up cost cif $500 0'[ less: .Andsuppose this "alternanve rr.an.drise:"'\1 tookadvantage of fhe most poweduj fO;~11 of leveraged gruwth know n to h umans-ei?Cl.110fJ£!11.twT grawfh tlrro.ugh CQmpound~ng. What you would ha ve is the ultimate 'Copycat system to create weaflh; wouldn't vou?

Today there is a ],.'1,{ ayfor ~the av erage person to copycat the wealth-building system of history's richest people,

Teday there is a way to get paid ]))(}O times fo~ the' work you do once, instead of getting pmd once for the work Y'(1 u do J ,pOO ti meso

In the coming poage'S you'rE' going to learn mor~ about exponential growth. .~ proven ~ys.ern tor wealth.creat ton t.hat <tver;~{~e people like yOU and I ran copycat And yOll'l~ Iearn haw

32'

th~ cOJ1~bmll non ~,f exponential gr~Jwth and the franchise concept can emp()We.r you. to create more personal wealth in less tiffle than any either income syste.ro available today~

CHPTER

Exponential Growth:

Formula for Building a Fortune

65

CHAPTER,S

ExpOinen1i~l Growth:

F ()Fll1ma rot' Bnilding of ortuae

If you want to gd rich,jusl find s.O~nione .nmktng lats of mo.ney and do whM he's doi'tW

- J,Paul Getty

I I'd like: to open, this chap tel' by telling you a story about an 88-year-old, washerwoman named. Oseola ]vkCarty. This-story will open your ey,e::> to 'the most powerful, most ,~emocr<;]t.ic form of \vealth-huiklling le\rer;:lh>:e in the world. n~s caned ci:m'lpounaing, and i Ie has !.he' powe:!: to transform paupf.:.'f'Sin to princes.

laliJGH LIFE

Oseola McCarty has li ved a tough tHe I that's for sure. At age eight she was forced to drop out of second grade to help her mother wash and.iron the Ile:i.ghbors'"clothes. Seventy years

67

later, Oseola was still working as a washerwoman.

Shecharged $1.50 to '$2 abundle=-tbar's a week's worth. of !.a undrv for it familv of fou runtll the end of WW iL A.iter th~ war she increased her price to $10 per bundle, Even l n her bes t year ( working 10 hours a da Y r six da ys aweek, Oseola neverearned mere than 59,000.

·SMAll SAVIN.GS MAKE.'" BIG DiffERENCE

Oseola was 40 years old when she W<lS fin.-illy eble to start saving money. She squirreled away pennies and nickles at first .. _ then q uarters .: .am:d even.tua11y·doHar bills, She put her savings in a 10£::ElJ. bank and never touched it. Over time, her savings add ed up, and the' princi ple and interest on those savings kept bui iding; and building.

III the summer of 1'995, Oseola McCarty-' the elementary sc-hool drop-out who never earned more than $9,000 a year-,tonated $.150,OGO t.u the Unh~trsity oj Suuthern Mis$isstppi!

COM·POUNDING: 8TH WO~O,EIR OF!HE WOR!1i.D

How is it that an a.vexag:ewOlnan with below av erag.e ed uca tion aud income 'can accumulate 21. small fortune? In Os.~tilia"'s own words, "The secret to building a forl'une 15 compounding interest. ,(

68

'Webs~r's defines compound interest as il the interestpaid on.both the principle and the aocumulated unpaid.interest;' The' key wordin this definition is "aecumuleted, U If the principle or interest is spent instead of reinvested, the power of cOll.1poundmg. is diminished,

Also known as the" d Club ling' concept," compounding has c reseedmorefornmes fhan arty other sin,gie investment vehicle in history. ,Arith .eompounding, your money is working £Or you, evert When you're not working. AlbertEinsJei:n .• a. man who knew a thing or two. about mathematics" went 'so far as to cal! compcund log ""the"8th wonder of the world." Indeed, .'COO"Ip6unding is the wea .. I.th creation principle fhatdrtves WaH Street and. the ba nking Industry,

EXPON'EINi11Al GROWlH = EXPILOSlve GROWl1H

What is it about compounding that makes it the i'S!:h wonder of the world?" tThat property .af compounding enables it to tum mea,ge.r.savings into small Jo,rtuD.es 1: The answer is .expnnenJitd gr:owtlt, the ul timate tool for leveraging

timeand money] . .

In Chapter' '3" you'll remember, we talked aboutfhe limitations of linear growth, To best understand the. dramauc difference between ~ gfDwth ,and linear grow1h..let's mke a

69

ItUVE. OF 72 liN AC'I10N $lO,OOO,o:riginal investment 10oJj)n~luft1 on irwestrnent 72/10 =7.2 ye,m;,

moment .to review 5001~ basic prindp.I,es of arithmetic that we first learned a bout in middle school.

Linear refers to certain JUTIC.'tiOn.<; of basic math, like simple addition, A~;picaJ ·li~.eQT equation would look like this:

~I:'~slic,.and dramatic, Here's a simple equation 'b)'always keep in min:dw hen you are mvestir:ig your money .... or your time:

"'Li~~eat Equals Limi-t.ed. Exponential Equals Exp'lo~ive. "

1HE RULE O(}I" 72

5 +5= 10.

To better understand the awesome power of exponential growth, Iet's look at a doubling concept called the R!~le v172_,The Rule or. 72 isa simple formulafor fjgilling out how Jongit will

take for a:n investment to double, .

Here's how itworks: To calculate how many years it will take for your investment money to double, first you determine the annual intaesJ: rate. Then divide"tn:a_t in.tI?De"Stra.teinto 72. The number you €l1d up with Is the number of years itwill take for your mvestrrrenr to double.

FaT example, let's say you hWe"st$l 0)000 in .a stock ilia t pays you an ann ual return of 10% ,(the aVE?tage annual return in rhe stock market fur the las iso ye.'1:lJIS)_

Linear gets its name because the ,grow th occurs in. a straight line, step by step. That's why we refer to: linear equations ,as caleula tions in "the firstpoweronly,"

Exponential, on the, other- hand, refers to a more sophisticated form of mulfipllcation known as. "squaring." A typiml expanentip.1 eqPlCl"Wm mightlook like this:

::F=25

'(vs, the ht~ear equ"tion 5 + 5 = 10)

Exponential gets its name tram the sntal! number placed "hove and to the rightof another number to indicate how many times the root number should be multiplied by .1 self, That's why we refer to exponenrlal equations as" calculations in "the second. power' or "third power," and li'O on.

The-bottom line is this, Lineargrowth ls in("remental and &'l'adual. Exponential growth is

70

11

GOP'fCAT MARKETING 101

Therefore it will ~ k 7'· .

'..... • '" .Wl. til. e,2 years for your

investment of $10~(JOO to double U1tO $2:o;t)OO ..

The Rule .or n is certainly simple to ealeu]~te. bUitJ;e results of th.e· fcrmula are.nothing, short of miraculous, Thechart below compares. a $HlfOO~ i~vestment growing linearly vs. ~x~Qnentlany. <l,t i 0% . per year (remember; at' lO Yo, $10,900 will double ev@.ry 7_2 years)'"

I

li,u:qr- (lrowth E:r~UMUt'nt,ial 9mW;(h-

($.irnpJe~(jjtiol1 concept) (dotlIlJiillgCOiIKe:P[)'

investment: $l~JOOO

~<ifrer '1 yffi~ $1C! K + WK = S2-0.,000 after H YrS; !!i2Q K + 10K = .$$O;UOCl an\~t 2.2 YIS: $3(:). K + 10K = $4O;OOrl a~r 29 yrs; (j;4(l K + lOK = :S50/XiI{) after 36 }'JiS: $:50 K ~ IDK= $QfMOO after 43 yn,~ $60' K+ 10K = $7[lJ}OO al:wr SO )'T:5: $7{) K + I QK= S80,(J{IO

s W,OO(J s 2(J,OOO. $ ~O,_O(h;1. s SOl)!JO

S lbQ_.OOJ

$ 320",000 $ 640,00(1 s l.,JOO,OCI{)

_ This cha-r~ 1S a vividillustretion ofthepower OJ ~~pOI~en:I';U .. g:n.Jwth~and n points out the serious h mitatrcns of linear ,g!L''<o.vvth. The first

fewvears the- arowt L' ~ 1.. th

, .J. <:r n cLl lI.S about . e. same, But

because exponenti I .... t;

~. . ..<IL''- nai groWmt occurs .g:eometrI-

call y, the growth of. theinves tment becomes more ~d more ,c;lxp~os~ve overtime, ~, final tQtal tells the la,j.e-- $30j.()O'O genera ted by Un-

72·

ear growth, G.s oPt~osed tD$1_3 million ge.lle;rnteiby txponentud grmoth!

That's why 1 c2111'exponentia 1 growth·" the

formula for buildiri,g a fo:rturl.e.,J Expoflen.tia,I gtowth en2lbl~s yom money to grow ill mul.tirples, Instead of growing: m.a measured step-

by-step pill.ce-

COMpQUN[)F~GYQUR WAY TO WEAl'JIH

A -perf'ect 'e:xam_pJe of the .power of. i3'xponentj.al gr:ow.th Hrrough compounding is the iT'tvestnlent fund .£ounded by one of the world's richest men. Warrefl Buffett- li-vou had

.. . ~ ~

"iriv'ested $10,000 with BuHett's Berkshire Hathaway Fund in 1956, 1aI1 .• d. reinvested the irt.terestand dividends year after 'year, today yuur investn}en£ "",,,,I.1Id be worth $80 mrllionl

Sounds imposs<ible, doesn't it? ,.~. An $80 million return on an 1fivestroen.t of Cl~'ly $10;000! B,lt that's the power of takjll.g advantage of cornpolIDding by lettingyouI il,vesttnenfgro¥{ year after ye~H' _ Just. look at a fe.wof the companies that have grown IOO-fold over the years; Xerox .. , Kodak --- fBM -_. Wal-Mart .--

"Mic.-rosoft .just to. name, a few. If you had the

for~ght _ the patience and the m"Oney to

invest wiih .tiny-one of these cDnrpanies 25 years ago, ynn'd be a. millionair~ many tim.es over

today-

Oseola McCarty isa classic example {)f why I eall compourtding'·'k'v.erage jor the HHle gU.y_" Ih~ rwo other kinds of leverage.I talked about ilt the. ·l.a'st chapter+-emp lcyees and franchising-« are certamlypewerful tools fer leveraging, But you need either lots of money or 101.'S of talent to· put fhem ttl use,

On the other hand, virtuallv anvonecan take'

,_ .J

advantage of Ihe.swesome power of compounding,. Compoundingjs the backbone of the exponential system of w.ealth: creation, a dynamic way for you to leverage your time; h\lents, efforts and money.

The copycat sys:tem you're goin.g to learn in the coming pa,g,es eliminates the two biggest drawbacks to compounding-e-ttme and, money. Let me explain. Most people today don't have $100,000 _ .. Or $50[000 _._ or even ~10,OOO I.ying around to invest. And even if they did, they aren'twllling to wait 4,0 to 5,0 years for it to .s"TOW exponerrtraily, vVith·the~:o.gt or Hving going t:hro~gh thel:i(j~{1 two-income families call barely make ends ITleet much Tess Invest their hard-earned mOlley in the hopes of living long enough to enjoy·a. cushy retirement

14

T.lIME Is; MONIE.'t

So the question becomes ': How can yo~u '~l"eate wealth. throu:.gh exponential.growthwi fu?ut having, to illlCest th.ous~nds of dol~ars, .. or with-

i·h·.·.· '.-., to w· "1·'- '" Efefune while yOUI' s:mal.I

OO"~U~~ '. ..~

nest egg dopbles itself into a snm~ fort~e?

The answer to that question can be to\lnd U:. an .' u . ~ ""b,t", d "'p. Iica table'conc(fpt th<l.. t combInes.

aJnoru ... :1"".. ."'.' - .

Ira - !-;:. - ..... ·'th <>xponential ,o·m",,~th.lt's ca~h:~d

.. anc[Usmg 'V1 ,<"....... ' 0'

Net\\'ork Marketing: . .... .

. It's ~e that most people in this world don:t

have much money. [hlt one thing weall ~av-e J$

f . n l . (""n -eoro-aruze our

time let's ace it, -a . o.J us .... '. ~ c. 0 . . , .

'd,w ~()"squeeze C'~lt a few more hours 1.£ w~'re

".- b out u""lng·. that time to S.t.aTt (l'ealmS

senoUS a,.,-, ' ... ' "'-' . .

true wealth. _ .

Here's a sjplple formu1a tor succe?s m the

coming d:eCtldes~

T -=:i::ime invested in dupli C2l ring .

3 mpycatmodel (franchise concept)

E2~ expo~enttal gI'0\'\'th.

$ = :Hnanci a;] freedom

Tx:.F-=$

In tJu~pa,gesllia.t foUow~ you.aIe gomg to learn llow Network :tv1arketimg wi]] ~bJ~ you

. .' ._~. "'"" lth bvmvestmg vour

v,)"(opycatyourway •. v W' ....... i - 1 . .. . <

75-

COPYCAT MARKETING 101

time' -.- instead of yow- money.

The question, isn't whether or not. this simple, duplicatable system for creating true wealth works, It wOI~ks; all right, as evidencedby thousands upon thousands of 'financially free men and women working-ina $I[JO 'billion worldwide industry growmg at fl: r:EL te of 1.0% a year_

The question, my friend, isn't whether or not this, proven system works. The ques non is

this: "DG yr)1'l I1JiVC the vis,ion to see if the:w~'sd(Jm

to ,uml£>rsland it , .. an.d the G_Gurage to take adi.:v;mtage of it so that you, foo, .can copy,cat' your w.ay to wealth?"

76

CHAPTER 6

Synergisrn:, rvla:rriages Made in Heaven

77

Synelf.gi.s:m; Man:oiagesM.ade :in D.cu.V1en

If yo 1..1 haue built castles in the air, YOUT work J'j,eed not ,be lost, That.is uhere they shoutd be. Now PJ.I,t tJre ftnrndai:~r.ms under them.

- Henry David. Thoreau

A de_te:nJ'i.ine-d irn.mi.gr,a.ut. n'tU1ed.' '.' Ern. est _ Hamwi was trying his best M sell p'Jrer~ thin Persian waffles. at the '19.05 \ .... lor1d;s Fair. He worked from sun up to sun down ,_. he gave ?Iway free samples to' everyone who walked past his waffle stand .,. but nothing seemed to work No one wanted to buy his waffles,

To make matters' wore, day after day thousendsofhot, hlli'tgty fair-goers would rush past Ernest's Ionelv waffle booth on theirt ... 'ffv In

. II· ~

stand ill. If ne a t the ice cream booth two doors down, Ernest wOi;ijds~.d his long days watching the ice cream vendor rake in money hand over fist. Talk about adding insult to injury!'

On one ,especially hot, C~Qwded afte~(;on, Eme.st's fortune took a sudden tum for the better. Tb-e.ice cream W<l;S rye!IJng 80 fast that '~he vendor ran out of dishes. In desperation, he ran down to Em~~st'swaffIe stand, begging for ex tra pta tes.

A MARRiAG,c .MAllE IN HEA'lfEN

Ernest ui.dnlt have any plates, AI.! he had were s:tack~ .and stacks of soft, sweet Persian 'waffles. lha] he couldn't even give away. Suddenly, Ernest hadan idsa. Maybe he w~Icl roll One of his wa tiles up into. a cone that would hold a scoop of ice cream. Sure 'en.Jtl1!.lgn, the cone worked like ,tl(h&m.-aJ;l.d that was the beginning of [:he world's love affair with the

- .

Ice cream cone,

k€' cream and Ernest's waffle cone went together like a horse ,andcarri@g;e. It was a IDEI.rr'iage mad.e in heaven. Th.e i:ce- (rerun tone becanlean oVcrrigh.t sensation and H~ehi:t or :he 1905 World's Fa~r. Nearly a oentu.ry Later, tee (Team (Ones are still the world's favorite dessert,

80

.sYNERGfSM

The tee crfi<il.m story Is a. great example of the concept of syncrgism_ That is, t he combination of two different products or concepts is often greater than the 'sum of its p3-ITS. The ice cream cone is creative synergism.in action:

Ice cream tastes good. Waffles t,rste good.

Put them together .- THEY T ASl E GREAT!

THe: AWESOPdlE P'Ow;E}l, OF 'C.REAiIVE SVNJ:HG1SM

History is fUled withincidents where the synergism of two distinctly differentconcepts crea ted breakthrough products "; incrediblj profitable enterprises ... .and huge.opportunitiesl . One of my favorite synergism stories led 'tothe bt'st-seUin.gpr.oduct in the histery'of a, major Fortune 5(}0 company, the 3M Corporation.A 3M employee w aslooking fora way to keep his bookmark froro faJill'lg out-of his hymnbook during church choir pradk'€.

He explairred his problem dtlring· a brai nstorming meeting at the office. A chemical engineer remembereda failed experiment with

. a new adhesive, .and suggested applying it to the back ef a nQtep~,d. That uJ1Hke!yrnmri''lge between a notepad and a failed adhesive ended up becoming fhe Post-It Note®, a product that

81

produces billions of do! lars in revenues fOE 3M

each and every ·yearl .

.1 _.' .-

THE SECRET TO SUCCESSFUL. SYNERGiSM

The key to a successful synergism is to crea te an en tireJy new pnoduct -or service bv combm,rng h v oseemingl y unrdatedc(mtE'pt~ M.any times sy.nergllims are a matter of luck, as was the case wirh the invention of the ice cream tone. Other times synergisms are U1e result of :&om·~verytt~·2!itive people thinking "out ofthe box. U Wllatever the cause, the "'effect of a .succ~s~n~ synergism.is powerful .". unexpected .• , e"'xplosfl..'e ... and life-altering.

L~r's take a brief look at fo~r modern-dav .. ~ynerg:isms that ha ve dramatieallv irnpacted th~ lives. of people all over the world :

Tbe ~uhHnobHe-If a worldwide survey asked people. to name the invention that most symb(_~li~ed the 2Dth century, most ·~opIe. w~ uld Iikel y say. the autom~bile. By syn.ergLstu::aliy !Combir1.ing the horse-drawn mr~hlge = f.~e intl1tn,fl/ cmnbusti01i engine; Karl ~eI1.z m Germany and Henry Ford: in America chauffeured in the modem age ...

The Fax Machine r» y... . .,

. , . >. ",----..._an ou Imagine doing

82

business without a fax machine? '\-'\lith the exception of fhe telephone, the fax may lw the single rnost.affoidable and efficientbll..<.:.iness toolavailable today, The fax is thl?· P(' rfeet example 'Of creative synergism, a combinafiou of the klepho.ne. an:rilhe copier. Wha l a great concept ... and whata marvelous convenience r

The Personal Computer-The PC is. the ultimate synergistic product,.a brilliant cambinat.iph of the cal!uiai&f and tfw type:wri'ter. In the early 1~60s, Steven Jobs, co-founder of Apple Computer, had '.[1 vision; He saw a day in the not-toc-distantfuture-wherrthere would be a small, inexpensive, Incredibly .powerful'ccmputer siUing atop everydesk in every home, office, and school 'in thr world. The PC is synergism at its best'

Franchising - It could be argu,i"~d:that Iranchiing isfhe moot successful business model ( the 2f.HhC'cnturY:PlJlnChiSing is the"syn~~rgi~ ti~,:-cotlrbinaaou Gfthe ~~ucc~',~sruJ chain·Sion

- .

llke Sedr«, . and the small business owner. The

ronOL"'P,t has. been &:I Sm_X€&5n.U OVer' dle Jasl.:'iO yea is that tod ay some experts estimate more than] /3,o:f all thegoods and services wId in

COPT'CAT MARKET!NG 10 1

These four su(cessiuJsyne.:i:gjsm.s have impacted the world in a big way, thab. fOI sure. Ce·rtainl Y each of these :synerg i sms has helped countless p.rople·crt>ate huge fortunes, But if's safe to say that onl y the last one on the listfr.anch.ising~is a viable mE!311S fur fhe avera ge peLs.un to copycat their ''''lay to wealth.

FRANCHISING; A COPYCATIERS' lliREAM COME TRUIE

. Let's fate it, very few people have ~he money or the brains to design and build anew compater .. , C.I! to own.and operate·a car dealership Or a reta il store s:elHng fax rn.1.m.i.nes. You can't reallYCOpy:cat these· enterpl"lSJes because ,they reg u i re SPb'IC]al~kills, lots: of monev or both,

. That's tb.e beauty ofJr-anchising, By defininon, franchises 'Me dupiicatabIc models" H a product or service can't be -d.upIkaifed, thenit can't be franchised,

Franchising has been a real boon to consl,l'Jners, because w.ith a franchise, ~ successful prod ~ uct Or service can be duplicated in hundreds or thousands of diffel'f.!nt locations all over the world. J\ga.in, Mc[)onakYs is a perfect example, 1 h,efirsrn..>Sb:mr,a,nt"was located in only one city, 'San Bel!JllardirlO, C,fl,lifomIa. fost,everyon~'Who

84

SVNEFIGISM

a tt!: there loved the McDonald brothers' lowcost hamburgers and hies. But prior to franchising, only local. people could enjoy their food because ·tb .. ere was only one location.

Through franchising, 1 v 1 clJonald' s was able to make their burgers and fries' available in every city in the country" To' .da te thereare 21,DOO McTh:mald's restaurants in 101 countries, a nd a. new one opens. somewherein the world €lvery two days!

If consumersare happy about the concept (j,j franchising, just think how franchiseowners and operators f,(:_.',e}-they must beecs tatic~ Obviously, for thousands of business owners, f.ranchising is a copycatter's dream come true'

FFlANCHIS!lNG: How IT WORKS

111 effect, franchising is a pro .... en way for people to-copycat their way to wealth by dupli-

" fu1 busi F l..:~ " . . .1....

ea.ting ·3 success .t . usmess:" ranci ll,01 ng ts tne

classic.exsmple of a suecessfu l partnership. The umbrella compaI1y-O!r franshiscr-c-expands its market share by sfdHng a prov,en! profitable sy~tem to an. investor. The: investor-or franchisee-buys a turnkey business, thereby minirnizing hi s r lsk by a void i ng the cos tl y mista kes that inevitably OCCUI" wHh any new start-up business, It' s a will! win situation.

Fra:ndlising is perhaps tnegreatest business success story of the 20th century. When McDDna]d~sope:neo it$ firs"t fran:ctdse in the 111.l9 - '19505, franchiSingwa;, mi~ understood and pereei ved by most serious investors asa scam, Today, only SO years later, Iranchising is a world~wide phen6me~Rl·t AmQ.Zing!

NET'ffl)R:K MAFIKElNO;, IHE ULTIM PInE SYNE~GISM:

hna:gtne far a moment, tha.f y&ac were in. charge."0f cn;la:tin g the !lit imate syrfergism /()'r wealth. crea.tio~-a s:yne'rgJsm so awesome, 80 pm'Verh.l~,tha:l it would. touc:h'ev:ery r.'en;;on on. the planet and :improve and enrizhthe i'l:" ]j YeS'

inthe process: .

'(qUt 8yn_ergismwould be so duplicatable H,at anyoM comd·copycat .it

Your :SrJIleigism wQnkl. be s.c,affmd~ble that anY€lne could get inv.olved;

'Your Sj:'TIet.gis.m would gro:w e~'pOn.€'ntian'j; instead of Lineal' fy.

Your syner:gism w0uld be. avaiktl;l!e a J!. over the world.

YO"LII synergiSnl would touch bath men and w~,en ... youngand ClIO. ... rich or PQo]'.

. Yom sy:nergisrn.:wouki be the tdthnate copycit s.ystem to .create r;-v;eaHh.

\tVel.U'm delighted "1:0 r.epo:rtthat there is sum.

86

aradical svnergism ~ It's.a matchfru3Jd e. in hea~ ' .. tlh.e C'Ie~tiv~ cornbmation or MO of the j1i0St powerful wealth-creating vehicles in the hJstory of th@ world ... the ma.rriage offrllrlchi.singrm,d

e:{pDner1 UalgH)'i,j)th. ."

The result is a concept , ca 11 tal;? Ul fimate:

Synergisrl1l.~Neh-'ir()rk MJ:rketing. What a brillumf S}/11R1'g is-tic. con.cr.pt - .(] jranc-h:iEif-: that ¥ f.fm}~.;:~'i(,ptlnffliia{ {yf

<,' Ncrnr·or.k Marketin.g is .synergism ~t i ts best, nt's, tll.e ice (1\".Bm. cone . .. it's the ,automohile .... if s~he faxm(Kbin€!, And. lJ1<l,rJ!; my words, ]f ypu. thQught'"fra,nd1is'lllg W<liS' big-Yfm ain'f 'seen ml.th;itl' yeP

CHA:PTER 7

Network Marketing,::

The Ultimate Copycat Syste'm'!

89

CHAPTER 7

Network Marketing;

The UltimateCop'ycat System

I' ve fllways .feU that l clarO h(1[;Jf' to bean ~Jn:gh'1aro1' -.lUst a good ~ttt.pl.ic.at.Gr, -h.fux Cooper, owner of 47 McDonald's franchises

o far we've agreed that duplkation is the :key 1:0 franchising's, success, and we've agreed.thatexpeaennal growth through·compounding is a time-honored way to create wealth.

That's why I call Networt M~,rkeli(lg the "uH:ima:re synergism" - it combines t}'l:~ best fr,om the C-DHCl.->P!.r.if fr&·~'1 ch i;5 ing - __ '\vitb th 12 best fJ1i:m1tne .cmUiept of d:pmltmt~l_grm.utk It.' 5 <I marriage made in l:&ave.t1!

Let's takea few moments tL1 review e£ld:'c'Jf

these twoconcepts belure learning how th.ey combine to 'create the ultimate copycalsj'st.er.n for wear th creati on-N etwork Mali'ketin:g~

PARA~LE. OF HIE UNP'ROFITABI..E SERV,AlIJtf

As we pointed out earlier, exponential growth (also k nown as "compo lIJ,fld.i.ng'~· and "the doubling concept") is a lime-honored, wealth-I.milding concept that rich people have been taking advantage of fer thousands of years.

Even. the 1,3jbl€ recognizes the importance of taking adv;:mtageofmmpOl.mding,as evidenced bylesns' parable of the "U nprofitable Servan t." The parable goes like tills:

The Blaster of a hrrge esf,;~fe was preparing ILo leave On ~ long business' flip. He su mmoned three trusted servants-and gave each a-sum or: money for safekeeping, The first serv ant received five talents: the second servant, two. talents: and the thi rd seN?11J~ one, talent,

TIlt' first two servants.invested fhe mo.ney they were g.iven, and when the master r'enJ·rned.l they bad doubled the princlple and were praised by the master for their wisdom.

11le third servant, however. wa;s afraid of losing the tlHmey, so hE: b uded it in !:h~ ground, He returned the: single talent to his master, and nething-more. The master 'chasti sed the servan t

9:2:

far not hwesting the,mor~ with bankers, and ang;l.'il y dismissed brim on the spo+l

:P'llfT1'lNG YOUR MONEY TO WORK 'FOR YOLI

The parable poirus out the importance of maikingwise a1l(l productive decisions, wlb(~ther they b~ f naneial decisions- or spiritu aJ ones.If s not enough to be ·b.leS#ea w]th 0pPQMmrity ". orrnonev .... or talents ... Qr abilities ... _ora soul. 'Th~ real issue is what you do l,.,;-Hh those blessings-whether ynu bury them lH the g:ro\1nd, SO tQ speak. n1'".in.vest them wisely so

that tl"l:~y grow and multiply. .

The pow.er of sxponentia 1 grmV"th is obvious.

-you can pur your mOllti~y to work for you so thal you double , .. and redouble ... .and redp~ble your money again and agam .. With compou.ndlng, yOLl r money is WOi kifi~ for YOil ----;rven while you 're sleepmgl Eins.te.iIil.k.~ew what he was ·ta·lking, aeout when he called Il ompou.nding the ."Both wonder ~)f !:he VI' 0 r ld! '"

TIM!: IS AN ISSUE

There's a catch, of course. Otherwise. everybody would be copying the expon~ntial svstem fat wealtllcreatiornand everyone m the

.. . I.J: b icl - 't ~I - t'-un1 T'i~' " .. ", 3I'"

v,roddwo1,1u er1:'1,.lSn ~la( J ."'. ,., ....... - .,.

two challenges to traci:iJiOIl211-compo'iJ.E1dj]1g_-

93

and for most of us, they are MAJOR CHAL~ LENGES_

First, YI"l order to invest money, we must h~ve ,~xtra money left over after we 1,,(i,J our bills! Unfortunately, that's.seidom the ease .. As a comedian once put. it,. "Most of us have TOl) 1'I.f(JCH MONTH '6!t the end of the MONEY!" The average persoo is lucky to putawrty ~100,a month-s-and $1~2.o0 81 y~..r isn' t much ~fa nest eg.g.

Second; growing your money through eompound.mg takes time-a lot of time! It would take morethan seven years for $1,000 to double to $2 .. 000 it it earned lO'7~ a year in the stock rn.ar.krrt' .. The doubling concept.doesn't look so attractive\lJlh€.PI. you Mly have a' few, hundred do1!.alfs~r €,¥eI.1. <!. few - thousaf1:d doJb'il's.,-tQ invest.

. Fr"mkly ~ most people are just too, busy gmtlllg &fto get. rich through compounding.But thanks to Network Marketing, tf)tiftY these is a fnmdiise-type~,,1I6timl tnor emJ,blp.s Y.o!"' teD create wel11ih ami freedom expm1mtially it1' monlJ!5 and veal's, i'~siend 0Ider:adcfj!

!"HE SVSUM i:s THE ,~i!SWEA

B~cause Netvlrark NfurketIng is so dupllsatlbfe, it's the tubm:=tle-rnpycQit;S.ystem for we~lth

}4

creabon. res 'an atfordaMe,. fianchi:::.e-Hke: concept that leaves nothing to rhance. To succeed in Network Marketing. YOt.:L dnn''thave< to possess "star" talent-like Torn Cruig!?, or 'i/'lhi,tn£v Houston~8nd you don't have' to be a born ~ius~ljke. Albert- Ell')sfein Dr Bill Gares.

Unlike the entertaffiment industryr Network Marketing is NOTbutlt around'a:sta;r. It's built af!Ol.:mdo:rdini3ry people g.etting :EXTlZA~otdina t-y resul ts by copyci1tting a proven 'system, and then teachlr~g .otners to. do the same (Network Marketing has. been described as N averaze peoole rnak ioe 2lbo'ile-ave:rage

.0 1.. 1:'- .,..1

incomes").

But instead qf :speuI.ding hundre.ds oJ thcu-

5a1'tris: of d~UaIs: to start. a f:rcMlchis(;',. you only nef'.d to inv.est hrmd.reas of dollars to start your Netv..tCU'~ Mai:keHng "fnmc.hise"! Th,~:t'swhy some exper~ are (<filling Network Marketing the ~Peuple's Franchise" .-. and 'Why l call it the II Alternative F'ranrnisc.'ITM

CIf)PYCATI1~IG THE RlGHT PLAN

TIle,key to b:uilding a larg~, profitable franChiS.NHlct to'bui1cUnga large, pm{Hable Network Marketing dist.ributlOl'ship is Lhe same-you need to take adva ntage.of your God.-giverl abilIt.y as ama~-t:e.r cGpycattei; a talent we agree you ahead y possess, The only dHfer·r;;.f.;r(.eisf with

Networking you'll .copycat a franchise-type c(mcep t that creates true wealth, as opposed to CQPyC'ii:ttiilg the job 'track, which only creates temporary income.

\tV'hen vou invest moneu in a franchise -- or

~ ~ .

when yOU invest time in a Nel.wwk Marketing

bu s;in~ss-w ha t you are rl\'l.lIy.investing in is THE SYST.EM_ Instead of tIying to ,create'from scratcha multi-hil Hon dollar enterprise like McDonald's, doesn't it make more seilS,€! to f()]h.}w their blueprint lor s uccess?

More, than anything else, li; ... ~.hat the McPona;ldlg Cb.rpDr;tjofl offers its franchisees is a goof-proor Ji)"stem. People may bi.l~gh at the name of McDonald's stat€-:of-the-arf t.ratrlih,g cente,[-iI 's called Hainblugcr VnH:rer:sity-but at McDonald's headquarten;" training and. ~duc.ati.~n are SERIPUS bnslnessl

In order to be flW.:1'irded'<l McDionaldts: fra-nEhi.~, YGU have to at~end Hahlburges U. and

Iearr: to copycat their pr{TJ£H5:yste'f11 a system

that has been workin g like a charmfor 50 years! Uyou aren't · ..... illing to mpym.t the' $yst~mr you don't get a franchise. Ies that simple. The last thin g McDana J d's 'wants is .a fa iled :franchise!

FRANCHISrNG ls A WI.r'NiiER

I think it's safe to SfIy that during the 19805

96

and '9(}s, franchising was theworld's hottest business c{;ncc:pt-and the ind ustry is ~till enjoy.in:g phenomenal_ grov..~th. Ac:mding to En irepreneu» maguzme, in 1990 540,O~O franchise: worldwide rang up sales ot S7~8 billion .. THAT'S RIGHT-5i58 BI['LJON~

Cpns,iderLng tharfranchising '\ .... as thou¥htof as a scam only 50 years ago (and was a tmost banned by the u..S .. Congress), it's,am<lzing_th~t today the indus tTy en joys a great terti tation ..

How NiffiWiR'K MARKE.T1NG COMPnEs 'T'O FFlANCHISING

Network Marketing companies assume a role similar to successful franchises, The Neiworking(l~1mpany supports its "fran('~:$f..f'<;''' (bet tel: known as dis tribu to rs) by orreri n g quality products- anda turnkey syste!Y1 backed up" by hied -a~1[d-tm~ rna rketirig .. ~:1:~ educational materials, such as brochures, flyers,

t~p~s:, and such. "._.

Th e sys tern is the key when it ~omE::S to both frandrislllgand Netv,"ork Marketing, Your 5Ut:c'ess depends on your ability to duplicat:-not innovate. The better yo1.i'i.we at copycattIng the sysr,en.l tha t ;;dr,e;=J.d Y exists, the more successfu t YOU will be,

. No matterwhen yau Join a N(:,two:rk _Mat'ketill,g{))lUpan.y,yqu a're Ei1.v • .'ay~ lhc head Of yotlr

97

.own.company ". and each OF yom independen t distributors is head of his Or her .own.-compa.ny It's .LiteraMy a Eletvvork of CEO's.

AiDVANTAGES OF NETWORIIQNG OVER FRANCJIISI'NG

AUhough franchising and Networkingare both copycat systems, Networking e!lij:OYS sev,eral key advantages over franchising. Tab ... a Iookat this c_hart oOll1pMi.ng these' two. p1uven copyca t SYSti?IDS:

:Ay,e.rag~ frnl'lduSle' fee_ Start·up tOT $.~OOl

: Is ~~,([I(l o:r Iess

Tradetime for mom~y --- Income grows

(linear gro'i.~·tht e;.;.ponenHaHy

YOU PAY 30%·1 0% COl'ilp·<i,n:y .F A l'S Y'.,)U 3%

'rnm1ki1ly itrutth.i.!iing ke 28%. or yO'W" o£gtlli'!iza!:h.rn

Hire & flre ~pl~ - No ~!ilF]oyees

Ovflrrt-Cli;d b~~ as - Home-based

!"ffil grow . b ~.Ji!e5S

I 5!:cm:! hrs, are yow:' h~.. _, Set )'tliX.r· (lY'(11 hours

.......- N'1!If:i.onal;& gll)baI l~enU!.1i')" - BuiUiing your {l~

d~"il!m~

Res:t(i&'il tEt-r1 forI' Ilnikling s.uLri~ cl~'s. dre~m!

. As YOll can se~r Network MMketing .t.a.kes the ~est fLOm franchising-the concept of a duphmtab]e systc-m-and Ie.ave~ fhe r~~,{, As

98

I

I

I L

a result, Nei:¥lorking takesCopycat Marketing 'to a whole flew level, which is why some expeds are caHulg Network Marketing "the next step ill the evol:u~ipn of free enterprise. II

F,If{ANCH!SE WITH E.xPON'ENTlAL G:ROWTH

Like afmn('.hl.~., each distribut~;r in yOllI network owns their own business. distrjbu.ting' products and build.ing. a fretwork of distrjbutors, But unlike franchisees,. as at Net'o,\rOl'k Marketer you do NOT have to .stay in the role of a fr-and'List.>e. You can choose t'o~ play the role of thplra71chisvl' by sponsoring. other people inlo yourbusin.ess and te3rd"ring t~em -to copycat a·proven sy5~em for w eaRth. creatIOn.

In ptheI wQrds,.francht:;>ees win ·~lways be lQcked.into lms<ll g;r,ow1th, nomaH€lf how man y ·ttancl'l.ts€s they own, Lrlmee:x.p]ai'l1 by describ-

ing a couple of scenarios. .

In the f rst ·scenario" let' s assume you are

"the owner of six fmndu.ses:" This is; what the liM.a~r gr~w,th chad for yom franchii.se- 'based bUI3~ness would look like:

.FraJi'cbisee

No 'matterhow many a dditiona I rra:nchises you ilIcquire, the_g:rowth will always be linear, YVhich means you Can never' earn morethan the total profits of your six franchises,

In the second socna.ri~, Jet's assume you're hC<lding up il, .gtolfl.'ll1g network of Independ eat distributors, Over a period of timevou f"utv,e s.p onsored six ~ey drstribu tors and d ~pli.cated yourself by teaching them to copyca t ynu by sponsoring six key distributors.' Each one ~f these $'ix key dis.trIb utors copycats the sys'lem and sponsors six key distributors, '~nct 50 on down the Jine. This is what fhe eJ:.p(me.nli~i11 gmi:vUf: thnrt for yQ.1..l r Netv..rotkirtg business would look. lfke;

Net work Ilatke-Ie<

CgJ'O'WS eXflO'nf~nt.i£1l1iJJ

A.;;;;; JOtl can p1a.iniy see, by ~p:onsodng six distribu tors an J teach ihg you r new people to copycar what you did tl.uougli.otit your organi7.,a tion .. you'd he'lev~r:agi;ng your business with hundreds of •. Alternative Fi"anchisf:.'5"TM (versus only six traditional frandLls.es)"

100

And. thaYs only the Up of the iceberg! When. the doublingconcept' of exponential growth starts to kirk in, the growth becomes ~xplo$i vc, Because or the rower· of exponential grmc'.'lth, some: Network Marketers have organizations that number in the theusands +even the hundreds of thousands!

ImagIne .earning,m override com m i ssion On the wholesale product volume gener,ltcd by eact{ of those dJstributors-It's 'ittle wonder that some-Network Marketers live lifestyles of the rich'and. famous]

You GET PAID FOiR. R.EOOMMIENOING!

We· a U know that tI:[I~. best k ind of advertising is word-of-mouth advertising, isn't that true? Ws something We. do all the time. If We see a great movie, like Fan~t Gwnp, werecornmend it H) our friends. But do We' get paid when our friends go to see it? NO,. of WU1·s.e not!

Same goes Ior l'€commend lng <1 gr:e.at res ta urant, We teU our friends, and family when ~ .... e eat at a: terriflc res'tOlm::ant-bu.t dcesthe owner zive us a commission on om friends' dinner

o,. .

tab? NO WAY!

ln Network Ma:rkf:?tin.g~ )IOU glat paid a COIDmission for recommendmg products and servicesthat you use and recommend an:s:,·\'ay.lt's

a win/win sitaation=-and 1Ws the most effec+ive, most ethical kind of marketing .in the

world. ~

How NETWORK MARKE1i1NG "IORKS

Y 611 know, McDonald's didn'~' start qff with 20 ;UUO-p]us restaurantaall over the world, They sta rted off with just One resta u rant-and then. opened anothes resta urantjust 1i,k.e the first one . .And tha.t's how you can startcrea ting ExPc:m.ential.growth through Network lvlarketing~you start with just YOlLl and one other ;person.

Do YOll think. it would be possible for you to' find just-one person each.mcnth to. join you in your business? just onepertner who's interested in more freedom, recognition, happiness and security ... one partner ~;,rho's interested in h'nprovi.ng his life, and the lrves of hisfamily?

One geed person a month - that' sall n takes!

How ONe: iP'eRSON A MONTH CAN GROW TO 4,.Q96

.Once you "sponsor" that person into your NebNmk, you ·become his ow her coach .. You dnrr't nee-d to concentrate all YOllseHo.rts Gin :scl.Iing yourcompany's products .. You ID\1:5t teach andcoach your-new person to cffed::ive.Jy copycat the sy.sb~m,.

Now, in mooth two, you teach yourfirst new

102

persnn.how in copycat what you did and spon'SOlI: one-person, ~'I.;hiJ:e iOU sponsor another new person. So, at- the end. of month tvv.\J; you 've personally spo:nso;l1Eidt'W'o people and yourfu:st new perscnhas sponsored one, as. welL Now you have a group offom-you and.three others\< isn't that c(juec,t!

Then you keep copycatting your sponsor's success system and teadl your ne<W" pa:rtnets M ropy yout toodor month'tIU'ee ... four ... five ... and so on. By the end of your first year, you)lltltave perS0I1.<illy spnn?ored 12 pe'opieone eaCh month. Andead"l. oneoHhem bassponsored one perSooeam montlt1as welL. and. so

00..

Now, at the-'end of one ye&, let's look .at

how the tremendqus power of exponential o~f'h rombtned ~i th at Siro.pm7 dupHcatablt: frmtc.hise= bke ,"Q11£tpt .caUed NehNotk Marketing

has exph::ided yom business: .

By SpGns000gjUSt one person a monl:h,~ a.ndby having .each. of them copycat your- eff-orts and spOI'!.Sor one person a month-by the end {If 12 IllJlntl1s, ·your organti::aiimt would have 4))9'6 inkl'endimt businesses in the form of Alternatillr Fnmckisesl

H.et,e(s fhe nially exciting part-the com-

panypay~ you.a percentage of your orgardz.a-

!?:ional sales volume, Hth~ Network Marketing I~ompany ,only pays 3°/" to: 28% in. sales commissinns, you. would earn between $12,:000 and $10,.,000 PER MONTH--or more!

That, myfri@no, is HOW TO COPYCAT YOUR WAY 'fOWEA1LIH~

THE U:NCISP,IJJlED fACTS ABOUT NETlillORK MAFlI(E11NGI

We've: talked a lot about.the fu~o'ry behind N¢twork Marke.ung. Now Ier's-Iook at some ·of .the facts about this dynamicin.d'Ustry. First ,or all. Netw""ork Mmrk.etjn'g,llike franchismg, fs a5Ck:yeal'-Qld industry.ff sa powerful, efficient method oJ distributing products and services .fI."O}"]) the manufacturer to the consumer.

Todi1liY Network Mark.eting, is an established way ~f doing business in 125 countries} and! world .. wide approximately 20 million p~ople ate independent dist-rlbuto.rs with~' a Ne,iworking eompan y..

FiOu.~w iFliEWDER

meva:"illi'lrllitg: anyiindUSItry, you need bJ ~oo.k aflhe;Jeade.rr because the speed of the' Jeader e.qu!lls the speed 'Of the packN1icrosoRin eomplllter oofhVare ... Coca-Cola in nOrl-alcoholic beverages ... and sq_ on. Both of these oompantes are loading. their industries mtcQ phenomenal g1'0wth.:cycl,cii.

In Netw",or k Marketing;, the ind 4Stry leader is' far and away th~ Amway CorporatiOn of Ada, Michigan. Amwa y has more than 2'.5- million re'newiug distributors; in over 75 countries and 'territories, with foreign sales accounnng rOI rolo-.-thircis of Am way's total sales, Amway Japan Is file fastest-growing forelgn-owrned'company .inJapan, second.irrsize ClJ;'I.ciprofitabHi ty only to Coca-Cola. ·Worldwide., Amway did $5.3 billion in Jt'~94;. $6.3 billion in 1995; $6.8 billion in 1996, and is 'cuITent]y gr.o:wing :at 19% pel' annum=-that'a more fh.an $1 billionper year!

How big is Atnway? In the giant household &ldpers~l products industry, Amway ranks, second behlrld Proctor & GambIein annual revenues .~ and. ahead of Fertune 500 mainstays Colgate.:P~otiv€ and Johnson ~ johnson'

It's obvioUSr-Netvv·orkMar ketmg is no ]oo_ge'l' a thMq.'. It is. no longer conh"Ov'e~5~aL Todav Nern.,'Urk Marketing; "is where frartchismg was 20 years a,g'~ies'a "people's ttaIIllchise concept" that gr:or,vsexpo:nentiillyrand it's just entering i,l:$ peak ,groVling ph.a.se:!

GiROWING Bl' lEAPS. ANlO SOUNDS,

Thejlndustry has mjroyeclp:henamenaJgrowth during the· past. few years. VVheo 1 first started. writing about the ind.ustry 1m the learly 1990sr

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~h-voiKmg was <'I $20 bUUon donal' a year business; Since tha:t time H has grown at a rate of 10% a year, and U reached worldwide sales of $100 billion in 1996_ And the best news ·iis the BIG GROWTH is still 'ahead .. as illustrated by this-graph

NE'f'WORKMARKHllNG GROWfH UM .. RT

lIillim15

n nI1iI:Jn ' goo I 800! 700 ,fU)

:SIX! 400

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As lhis·gFovvth chart deady shows. today wearejust st¥itln:g to enter fue Gelden Age of Network Ma,rke~ing. Networking is today wIle1'€' fraru:his[ng was 20' ye.ars .ag.Q--whh::h means the best is !Itt fo CiJi1IBi I pred i d that because of Net:v{ork Marketing's_ eXponential advantage, the industryis poised to surpass franchfse sales sometime during the nBxt decade.

This is more than a major trend-this is a worldwide MOVElI.ffiNT! I can it the P ~1dVe.-. ment, EJ stands for "£xp-onenti.al Enlrepl"enemr" and Network l\1arketing is perfectly positioned to take advantage ·of a. "tidal wave of ho-mebased e:ntrepreneudsm fha [ is sweeping the globel

The question you need to.ask yourse! r is this:

" Ant I guing to be.-~e of the peGplt wJtO -watches NertottlJtk Marketing ·exploae- am11' therl-t'xt ,de:c(ui;e? . __ Or am 1 gOttW to be one of the -pe.a,ple. woo .Mlps :make it explo.de- {md profi·fS in are process? I'

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1.-t". V. h •. ·" . S ,iOUr "urn.,

A.n invasion (Jf(lN1~ies can .1J'e' resiSfed_ flu]!' not an idea whostfime has wmC'. - Victor Hugo

T be best way to wrap up a book about <c!opycattin,g is to tell yon a story about one of nature/s best copycaUe:rfi-th:e Processional)' Cafe rpillar - These fascinating little insects get their name J~om their curious habi t of trave~ in an m:def~Y procession, one after fhe other,

Processioeary Cffil,teJrp.m~,HS are great at ,copycatti:rtg the behavior of the1f fellow caterpiUarrs.1nfuctt copyc.atlmgis aill they know how tn do. Thf1-ir "herd' instinct" is so powerful

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1'1111

'they've been known to follow each oilier, one after theother, end-to-end, for milesat a time.

Y. ears ago a scientist. in .~r ancecond ucted an informal experhnent to' test the strength of the Prooessionary Caterpillar's herd instind. He placed several caterpillars on the rim 0.£ a large flowerpot filled to the brim with the caterpillars 'fav;Qi:".ite leafy food source, and. an abundance or fresh water.

Sure lennugh, the caterpillars began following the lead caterpillar M(iJund' and around the rim Df 'the .flo:w:er pot .They marched ahead without pause .... hour after hom ._-_ day af'tJr;r day ..

Amazingly, food and water were inches away from Ute caterpillaes, Yet their instinct to. follow was so strong, not it single 'One of the .ProOesSiORary Ca terpiUar5 would break formetiion -. After seven days of endless matching; all of the ·caterpmarsdied from exhaustion.

WHO AR:E YOU CHOOSING TO ICOP'YCA:T?

Like the Processionary Caterpillar, we humans: IMLa ve a. strong herd instinct, too. That s why we're such g.rea t eopyc2I Hers. Fortunafe~y for us, our herd instinctis counter- balam:ed by our ability to tl'rink. Because we can think and reason, we can make choices, whereas insects are tQt'?l .. Uv atfhie mercy of thei r insfincts,

.-: ~. .

Unlike: the Pro<essiomllY Caterpillar. humans earn choose to hire-ark aw a y from the herd. We can choose ~tl stop cnpyc(J. ttin.g peop le

whose system will lead us to debt _

dependenG@: , .. , doubt --- and, for aU toomany poople, DrSASTER! Or we can choose to start copycatting people whose system will lead us to: prosperity and abundance-

What about you?' Are you like the Proces.sionary Caterpillar, blindly copycatting the plan .of the cat~mar in -frOl1t qf you until ~umd~lib~~of~~~~ Processiona ry Cal::erpillars"--dead 'e. 'dead broke ... or barely gletting by On a go.v~'Inment pension?

Or are you willing to break away from the herd and beeom€' a .:J·%..,er by copycatting a proven plan that could lead to true wea]i]}?

WHY COPYCAT A SYSTEM m:R: WEAL TIH CREATION? \!\fhy should you break ranks and. copy·cat a.

So yste.m that creates weal fu?' That q uestion can be .ru:'lsw.e.~ed til.. one wm:-d~FR,_EEDOM~ Fr-eedom from deM., once and for all. Freedom from a boss looking DVC( yom

shoulder.

Freedomirom taking part-time j'ODS to' make

~fld.:s meet,

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. . _ . .J l

f:r€edo,~to set your o~ hours-and you.r OV1.'l1 vacatron schedule'!

Freedom to build YOlt[ dream, instead of oomeo'l1.€' e lse' s dream'

.And freedom hom full-time stresscaused bytoo mnrh work for too little money ..

True wealth, Jtm'U remember, is having, enough money-and enough time to do WHAT you want WHEN ym,l want.·

True wealth puts the word. FREE back into, ,FREE ENTERpRISE. And that, my friend, more than any other single reason, . is why we· must copycat a sYbie.m, for creating true wealth,

Ir'sV'OUR T!J'rilN\

You can do it-yoahavc allthe skilleneeded to succeed in Network Marketing beca use you. were born a mastercopycatterl It's time to choose to bre .. k. ranks '>oI'~~i1;., .1.", °510;( d

. ' _ ,'," 'W ,oou,l., L' '" ALIt .]1 ... ; ;>; ',to-ern an ','

starl:(opycaUing a system that creates \~eaLth for y;~U~ instead ofconeinuing to copycat the caterpill ars going around and around ill an

endless rude. .

, . It: S }jour ~urn "1':0 break ou l of the pack and begin cn~atlng truewenlth - m·ui tornl frr:eal{}m!

. The si~lple truth is, you're -Illotrequked to do ,~nythmg th~t you're not already doing! yo~ re a~·ready an expert at copycatnng, isn't tha,t true? Sn don't you think it's timet,o ~opy-

11,4

cat .. 11 system. that will. help you realize your dreams, instead of a system tha t makes you comprrmnise you.I dreams.'?

It's ,obvious~

WIHAT ARE YOUR IRE.ALF EARS ABOUT l1HE FUTURE?'

There's nothmg to fear aboutcopyrnttin_g a system that creates true wealth, THE REAL FEAR los ending up like 95tyc of the people in ihis wo.dd~,eadf de;.~d-broke, 01" depend.e:nt On family. church or state.

The real fear is to retire in you.r "Golden

Years," on a,povedy~lcwl pension. .

The real f'er1r is to settle for li v irt$ a life 'of mediocrity, when you know in yom heart that you are capable of 'So much more ,.

TtI:e r,e,al feMls giving up IOn your dreams because you.lve chosen to CQPy.(~t a plan that can never make them CO:D'le true.

My friend." you must NEVER let negative pt1opl:e' steal your drearnst Nega.tive pe(rple are like P:rocessionary Cate'rpiU'ars-they will insist: yuu cnpyca1: thelr systenll1 ji~ing from paycheck topaycheck, even if i't leads around and arou .. nd in an endless drcle.

OPPORTUNITIES AAE KEVER MISSE.D -,

It's ),our turn to be free by cr~aii:ng true

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weal fh, bu t yaH ha ve 10 start copycatting a dU" ferent plan. Always remember, you 'have to. seize opportunities when they are presented to you. not when you think you are ready for them.

Like I always say, 1/(;PPf}rtu~itie:s Are ne-4Ae'r 11~issed_, 5om~ont" else ir;st takes advantage of them fo'Str'

Don't let th.i:il: oppo~iiunlty pass you by. This is your chance to grab the brass rtng,;. You can do it You're already agreat copycatter. GIve yOi!.U'Se1£ a cl'lartce to' cashtn on the greatest economic movement since franchising,

Networking is: today where frru:{erusingwas. 20 years ago---it's a $ 1 OQ":biUion~pe:r-ye:1tr business that is destined; fo explode' to $700 billion in the next decade!

Don'twait any longer! There has never f{een 11 bettertimetc g~ -:involved! Today youcan position youi:self,artthe beginning, of a. worldwide ffio-vement. nl S YOilIrWrnt to become ,aSo/»er, So take. advantage offuis:oppo.rhmity be.£(l~e someone else does.

Yoo:"re a great: copycatiB.r.

You have the skills it takes to succeed. The timing couldn't bebetter,

You deserve it,

If's you r turn. .. - - to copycat" your W,il,Y fo <.Uellit.h!

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