Case study: Nadine

One good example of what I just explained in my previous post is the case of Nadine.

Nadine is a girl I know.  She's a nurse.

Now not only does she works in a field that is highly on demand with a continuous aging population, but she also managed to take a specialized course in feet care.

Now don't ask me what feet care is like.  I don't have a clue.  All I know is that this is a niche within the health industry and she sensed a demande in feet care.  She took the courses thhat cost her several thousands of dollars.  But it paid off.

She have a full calendar of appointments.  And she is making tons of money working for herself when she is not scheduled at the hospital.

She has other means of income than the hospital she works for.  And this is exactly the embodiment of what I mean
 when I say that one must not depend solely on one source of income.

Nadine is a single mom.  And I am sure that, as any single mom, she struggled at times to raise her child.  But Nadine has a house and a car and everything that goes with it.  She was able to maintain her standard of living by being wise and understand that nothing will come to her, not even a steady pay check from the hospital.

She took the bull by the horns and he won!

Way to go Nadine! 

Case Study: Dominic

In my whole philosophy of getting independent from the corporate world, I think that Dominic is someone that stands out.

Dominic works in my enterprise.  He works in the telecoms department.  He is the sole specialist of some switches lists of translations for calls to get through... or something like that.  I won't get into any details here but understand that he is a guru in his field of expertise that is in high demand in any large company.

So right there Dominic has been able to ensure his employability to the company.  He has the knowledge that no other has in the company.  So he is indispensable in his department.  He is not un-expendable.  Working for corporation we learn to know that no one is.  But at least he knows that if the company wants to get rid of him, it will have to train someone else for a few weeks before he barely get to speed (not even get to Dominic's level).

This brings a second advantage.  Since no one else can do Dominic's work and that his work is in high demand in the industry, Dominic has an edge in his wage negotiation.

But Dominic was not happy with only that.

In his spare time he decided to start a home business.  He decided to rent portable hot tubs for people who wants to throw parties in their backyard.  He was not able to start that over night.  In the beginning he had a hard time.  He had to deal with the providers, get a place to store the tubs.  At one point in peak periods, he had to hire an employee.  He learned the hard way: his costs went sky rocketing.  So he managed to downsize and finds ways to cut cost, fine tune his processes and do some of the work himself.

It took him two years of trials and errors to get to the current business model he is at now.  And his business is so fine tuned that he can devote to it only a few hours a week and rake in the money.

He told me that at this rate, if revenues continue to grow, he will repay his house loan in about four years!  Not bad at all.

So if I summarize, Dominic has been able in two years to:

1. Become a valuable asset for the company so he is hard to fire
2. Has developed and launched a business that generates a revenue (that he don't need since he has a job)
3. The over and above revenue generated by his business is used to repay his house loan (which means by having no debt he will be even less vulnerable to the corporate world)

Dominic is an example to follow on the road of total freedom.

Link of the week and Case study: Jerry Garcia

Jerry Garcia was the guitarist of the Greatful Dead... Among other things.

He was a true polymath and marketing genius. He used a strategy for the Greatful Dead that was never seen back then. In an age where people were saying "please let us remind you no pictures and no pirate recording during the show..." Greatful Dead went the total opposite.

Sure bootleg us! Share you recording, sell it among each other. This helps the band getting known. And it helps on the sellings of a miriad of derivative products. So the recording was freely given to whom wanted to make a copy... But the money was made anyway... on the T-shirts, necklaces and other band's products.

This an example of thinking out of the box as a true strategist: do things the way others don't... and win.

Read more on Jerry Garcia by following this link.

Case Study - Actor Ashton Kutcher

I've been talking for a little while about the strategy of not putting all you eggs in the same nest (talking about work and occupying a day job). That one must diversify one's sources of income because if your employer get rid of you. Then you will at least have another source of income. And you can walk out with you head high, a slight smile on your face and the assurance that your financial life is not doomed.

I am not the inventor of this principle. Far from it. But I find that so few people practice it. The standard model I see in the world is: a married couple, borrowed to their neck to get the house, two cars, two kids, an education and a dog... the American dream. Both work a day job. Both live from pay check to pay check. And both are exposed dramatically if one of them loose their job.

I'm advocating another way of life. One with no debt. But also one with multiple sources of income. And I think we are still too few living like that. But not for actor Ashton Kutcher.

The guy is not only a famous actor through his role on "That '70 Show" and "Dude, Where's my Car?" But he is also on of the most insightful investor according to David Lee, co-founder of a Silicon Valley investment firm. He invest into Silicon Valley start ups. And he takes his investments seriously. He's in there to make money. Which is good.

So the guy is clever enough to know that a job in the acting industry comes and go. And one must not rely on it. And it gets worst when you age... So he decided to... diversify. And that is exactly what I mean when I talk about the multiple revenue income philosophy. But he is not alone. I've seen it quite a few times with actors and comedians. I know one diversified in real-estate. I know another that bought an entire stores chain. One again started a magazine. And I know a singer that started a baby food company with her husband aside of her singing career.

So what is it that artists understood that others didn't in the remaining industries? They understood that work is precarious and one must see to one's self for one's future income needs. But why is it that artists understood that and the rest of us don't? Is it because they are smarter? I don't think so. Its because of the nature of their industry. It goes by the contracts. So you never know what contract will be next or if there will be a contract at all. So you plan ahead. But we, day jobbers, we are paid by the week. A steady weekly salary. So after a while we tend to assume that the regular pay check will continue to come without interuption indefinitivelly. Until the day we come to work and hit a closed door with a statement pinned on it:"OUT OF BUSINESS".

Never get asleep my friends. If you do have a day job, that's good. It is very rare these days with the state of the economy. But be smart. Think farther than that: live below your mean; be frugal; accelerate you debts payments; get at least two other means of income (without killing yourself at work). Never be dependable of anyone. That is the recepe of true freedom.

Beging for a job, that is not freedom. Sending hundreds of resumes and receiving may be two or three refusal letters, this is not freedom. Being selected (by HR), that is not freedom. That's worst. That's below dignity. And asking permission for two weeks vacation, that is not freedom.

Are you proud of the fact that you don't need your parents' allowance to live anymore? Then why are you proud of depending on your company's weekly allowance?

Get clever. Like Ashton Kutcher.

Case Study - Cyril Ramaphosa

Born in a black township in 1952, Cyril Ramaphosa rose to become South Africa's leading trade unionist, switching to politics and then to business after the end of apartheid. He became one of the country's richest men, and is still occasionally mentioned as a possible future president. Nowhe is the face of McDonald's in Africa's biggest economy.

Mr Ramaphosa, who once said his favourite meal was a fish with salad, will own and run all the American burger giant's operations in the country, including 132 outlets. He will have a 20-yearfranchise and a mandate to "turbocharge" growth. The price of the deal has not been revealed. Since opening its first restaurant in South Africa in 1995, McDonald's has struggled against fierce home-grown competition. Famous Brands, its main rival, has more than 1100 outlets, operating under such names as Steers, Wimpy and Mugg & Bean.

Mr Ramaphosa, a lawyer by training, founded the National Union Mine-workers, building up to become Sout Africa's most powerful union. He helped bring about apartheid's peaceful end as one of the African National Congress's main negotiators, By the time he was elected to parliament in the country's first fully democratic elections in 1994 he was already being tipped as Nelson Mandela's likely successor, but he lost out to Thabo Mbeki.

He promply resigned his political posts and went into business. With his formidable connections, negotiating skills and charm, he took to it like a duck to water. He was one of the first to benefit from the ANC government's black economic empowerment (BEE) policies, building an empire in mining, energy, property, banking, inssurance and the telecoms. With investments said to be worth 1.55 billion rand ($224m), Mr Ramaphosa had joined the 31-strong club or rand billionaires. His wife is the sister of Patrice Motsepe, another BEE tycoon and the country's firstblack dollar billionaire.

Deals like the McDonald's one seem to fall into Mr Ramaphosa's lap. As well as servingas executive chairman of his own Shanduka group, he has a string of non-executivechairmanships and directorships of some of the country's biggest and best-known companies, including Bidvest, a giant food-service and distribution business. He is also a member of Coca-Cola's international advisory board. both positions should serve him good stead in his new job. Although South Africa's media continue to talk up his presidential prospects, he says he has no interest in returning to politics.

Does South Africa media really need any more fast-food joints? The World Health Organization reckons 62% of the country's men and and 73% of its women are already overweight, making it one of the fattest countries in the world. Almost a quarter of men and two-fifths of women are obese. But then, as President Jacob Zuma has shown with his three large wives and one equally large wife-in-waiting, in South Africa big is beautiful.

Source: The Economist, March 26th 2011

Case Study - Mark

Here is another case study. But this one is different. I should call it an anti-case study. Because this is the relation of a story of what NOT to do.

This is the case study of Mark.

Mark worked as a cubicle employee for a bank. He always seams to despise management. Until the day he was offered a management job. That day, Mark changed. He set a carrer path for himslef: "now I'm team manager, in five years I'll be department director..." and so on. Mark also lost ground with his friends (this was reported to me by a former friend of Mark). Since he was management now he forsaw no reason why he should speak to the same old cubicle people that used to be his friends. So he built a psychological wall between him and them.

Mark defended the bank's policy against any thing, even when those policies were questionable in terms of employee respect, engagement and commitment. Because Mark reported himself to a nevrotic manager which is so insecure and has such low self-esteem, that she has to micro manage everything, and she holds her department Darth Vader way: she is a employee commitment soul braker. Lets call her Darth.

Darth's way of management is to set a reign of terror over the employees. In order to maintain her employees' productivity, she unleash her team leaders on the floor as watch dogs of productivity. Moving row by row, watching the employees as they work. And even if this was against Mark's own philosophy (according to what Mark's former friend told me), Mark followed her rules to the letter. Just like the other "yes men" team leaders that Darth likes to surround herself with.

One day came that an employee got a special request. Here I don't know the details. It had to do with his work schedule and some course he had to take at school. Mark indulged to accomodate the employee in some way. But it would appear that what Mark did was against the company's policy. So to keep the story short, Mark was investigated and questioned like a witch trial by the company's investigators and Darth. Then it was ruled that Mark needed punishment. He would be demoted and relocated.

And to add to the insult and humiliation, Darth sent a memo on the floor for anyone to read stating that "... Mark is no longer part of the department and of management for reasons of lack of judgement..." This, I won't comment further.

What is the morale of this case study?

1. Avoid working for nevrotic manager.

2. If you cannot avoid working for a nevrotic manager, fight his policies when its unlogical.

3. The safest way to fight against a nevrotic manager without being eaten alive is to embrace my philosophy of total independance (aka make money from multiple sources, avoid debt, don't depend solely on you current job)

4. Never spit on your former friends just because you are getting ahead of them in you career.

5. Never put all your eggs into the same bag as Mark did in focusing solely on his manager career and not building an alternate source of income nor opening his possibilities with other employers. He had a vertical view instead of a horizontal one.

Mark's experience should serve has an example to anyone who only see the corporate ladder's way up and nothing else.

They Railed About Food, And Harvey Took Action

This is an excellent article en read in the Investor's Business Daily a few weeks ago. Very insighful on how to read your environment and get a competitive advantage over your competition.

Innovate: He gave train travelers long-sought satisfaction.

The early years of rail travel were tainted with bad food at stations.

Passagers had to deal with spoiled meat and coffee made with alkali-tainted water.

Service crawled, with meals arriving as the train was about to depart.

The uneaten portions could then be scraped off the plate and reserved for the next arriving train.

Fred Harvey (1835-1901) had been victimized by such hospitality in his travels as a railroad ticket and freight agent.

And he said enough.

He knew he could provide high-quality food and service at an affordable price.

And spotting the lousy competition, he kwew he could make a fortune doing it.

So when the head of Atchison, Topeka & Santa-Fe Railway offered Harvey the chance to run a tiny restaurant in its Topeka, Kan., depot in 1876, he bit on the deal.

The immigrant entrepreneur established a string of Harvey House restaurants and hotels - America'sfirst national chain in stations along the expanding Santa-Fe railroad.

Many historians say Harvey's hospitality and Harvey Girls - the well-groomed and well-trained women he brought in to staff his establishments - civilized the rough-and-tumble West at the end of the 19th century.

The Santa-Fe sped with the food and hospitality of Fred Harvey, says Walter Borneman, author of "RivalRails: The Race To Build America's Greatest Transcontinental Railroad."

He calls Harvey that company's "ace in the hole."

"The Santa-Fe pretty quickly came to realize that, hey this is something that people are talking about in a positive way," Borneman told IBD. "And if you keep floks warm and well-fed, they will come back to you."

It is a simple concept. But in Harvey's time, it was a novel one.

Across The Atlantic

Harvey was born in England to Charles and Ann Harvey. The family went broke when he was young, and by his teenage years the boy was living with an aunt in London.

In 1853, the 17-year-old boarded a steamboatfor New York in search of a better life, according to Stephen Fried, author of "Appetite for America: How Visionary Businessman Fred HarveyBuilt a Railroad Hospitality Empire That Civilized the Wild West."

He soon found a job as a pot scrubber at Smith & McNell's, a popular New York city restaurant. There he learned the business from the establishment's quirky proprietors, Henry Smith and T. R. McNell.

They taught him the importance of quality service, fresh ingredients and the handshake deal.

Harvey quickly worked his way up to busboy, waiter and line cook.

After 18 months he set off for New Orleans.

Soon he headed noorth to St. Louis, running a saloon and restaurant with a partner.

But his partnership - and the nation - were soon divided over the Civil War. Harvey abhorred slavery. His partner was a Southern sympathizer, ran off to join the Confederate cause and took everything the two had saved - about $1,300, according to Fried, or $33,000 in today's dollars.

With the business dead, Harvey moved farther West to St. Joseph, Mo. He dabbled in river shipping, then helped devise a system to speed up mail delivery by sorting it on trains.

Before long, Harvey was working for the railroad itself as a ticket and freight agent. The war was still raging on in the East, but everyone knew that when it ended, the race would be back on to connect the vast West by rail.

Eastern railroads went as far as Missouri. Harvey and his family moved to Leavenworth, on the Kansas side of the Missouri River, in anticipation of the coming tracks.

There was tragedy in his life, too. His first wife, Ann, died giving birth to their second son when they lived in St. Joseph.

He soon remarried, to Sally. But in Leavenworth in 1865 Harvey lost his first two sons - Ann's children - to scarlet fever.

Sally then bore more children in Leavenworth. Harvey would live

Case Study - Stephane

Here is a good example, with Stephane, for both my philosophy on money and on relationship.

I met Stephane a few years ago in my MBA courses. Stephane is an intelligent, soft spoken blond and handsome professional. He is a insurance representative. But he doesn't need any more customers. He's been able to develop is customer base in the last 15 years and now he can do two thinks he told me: first he can live on the recurring revenues generated by his customer base. And second, this revenue is enough so he can, if he wishes, work for six months and take the other six months off.

Last time I met Stephane after the MBA, he told me he was taking flying lessons. And that he was looking into a big land to buy up north with his brother. So he could devote to his passion: fly his plane to his lands filled with forests and lakes, and hunt with his brother.

Now this is my representation of wealth. Stephane is not rich or millionaire by any standards. But he is debt free, has good money in the bank, earn a good living and his revenue stream is steady and require minimum attention from himself. So he can devote to his passion instead of being in a cubicle for 8 hours per day.

The last time I met Stephane he told me that it was over with his girlfriend which brings me to the second part: my relationship philosophy.

I met his girlfriend once. It is a very beautiful brown hair woman. Attractive, long hairs and intelligent. Funny and articulated. But it didn't work. These things happen. Stephane bought a house a few years ago. And when he met his girlfriend, she wanted them to move together. Stephane refused to sell his house and proposed to his girlfriend to leave her apartment and move with him. So she sold most of her furniture and moved with him.

When Stephane told me that he left his girlfriend, he also told me that he was living in his brother's basement. He told me: "I left her two weeks to turn around, buy some furnitures and find a new apartment. In the mean time I left her the house and I live in my brother's basement for the next two weeks."

So there is my relationship philosophy as a living fact: Stephane never let go of his house nor most of his furnitures. Now that it's over with his girlfriend, she needed to move out. For Stephane, this is to a minimal cost (not to say no cost at all) for he doesn't have to sell a house, look for another house, hire a real estate agent, buy furnitures and all that stuff. He keep his things to himself. But he was gentleman enough to leave her full use of the house for two weeks as a base to make her moves.

Stephane is a living example of my way of life.

Case Study - Louis

Louis stated that at the age of 40 he would be totally debt free and own his house. And debt free includes repaying the house loan totally.

At the age of 18 Louis did trow the kitchen table at the face of his father, for some profound disagreement they had on some topics. He then grabbed his bag and left home. With only the content of his bag as his whole possession, he headed west to find job. He did and worked hard.

Its during his hard working days that were repeating back to back it seamed without end that he came to the conclusion that he would not do that for the rest of his life. He taught that a degree in engineering would look god on a business card and decided to attend university. So he packed his bag once again and came back to his home town. But not at his parent's place. He rented an apartment with the money he saved while working and started school.

He received an electrical engineer degree a few years later and started to work for a engineering firm. After only six months in the firm he came to the conclusion that taking orders from someone else was not for him. So he quited his position and partnered with a friend to start a company. He would build houses.

In the beginning he had no practical idea on how to build a house. He had all the technical skills but not the hands on skills. So they got in an agreement with another friend of their that actually wanted to build a house for himself. The friend would buy the materials and Louis and his partner would build the house. Their first. Once this endeavor was conclusive, they settled to build more. They invested in land and started constructing houses. And they sold it. With the money they repaid the bank and invested in some more lands to build other houses... and so on.

Today Louis is in his 40s. He has no personal debts. Has a big house for himself that he payed cash a few years ago. His company runs fully and has no debt. Louis enjoys life. He answers to no one, starts in the morning when he arrives at his office. Stops went he wants. If he doesn't feel like working or feel a little tired in the afternoon, he fire the chess game on his computer and play. Louis travels to Europe and the Caribbeans about twice a year. And he takes his vacations just when ever he wants.

Louis does what he has to do to maintain the success of his business. But he doesn't fall into the "customer is king" madness. When he's late, he's late. He doesn't bow nor gives excuses. You want the house buy it. You don't then buzz off.

Once asked what he would do if the house business would wane he answered. "I will simply do something else. I know I will succeed in just what ever I may decide to do". When confronted with a challenge or fear, Louis meets it head on. He goes straight ahead without hesitation. That may be an ingredient of his success.

Louis is the perfect example of freedom. An inspiration on how I want to live my life.

Case Study - Carlo Pedersoli

I know, I know. You must think who the hell is Carlo Pedersoli?

Do you remember the big guy with a beard in the fights movies, always partnering with Terence Hill? What was his name again? Ah yes: Bud Spencer.

Well Carlo Pedersoli is Bud Spencer.

Still don't remember him? Well then watch this clip.

So what? That's what I thought too. I thought that this guy came, made a few fights movies in the 80s and they faded away. Well how far from the truth was I? As an example of how to live your life, Bud Spencer is far from just a B movie figure.

Did you know that this guy was an Olympic swimmer? He participated to the 1952 Helsinki Olympic games and the 1956 Melbourne Olympic games.

He is the first Italian to swim the 100m crawl under 1 minutes. Performance that he achieved in 1950 at the Pan Mediterranean games.

After his swimming career was over he went on: actor, playing in about 26 movies, film director, business owner, he can fly planes and helicopters, he god a degree in law and registered several patent.

How about that!

He established his company Mistral Air in 1989 that he sold latter to buy a mill factory.

And as a cherry on top of the sundae, he entered politics in 2005.

What a man! This is the kind of shining star that inspires me. How about you?

The morale of this little story is this. Re invent yourself my friend. You are more than what you think you are. Just never stop dreaming and get them to reality. Nobody will for you.

Case Study - Tod

I will make a cases study serie in which I wish to talk a little about some people that I met and that did stuff I find are worth of mention. Those are people that took steps of initiative to make things happen in their lives and not only wait there until retirement comes, collecting their pay check each week. Like most people I see do.

Today I will talk about a guy I knew when I started working in summer time, when I was a student.

Back then I was working in a factory. I was 18 years old when I met Tod. Tod was a nice looking guy, bodybuilding and he walked and talked with assurance. Speaking five minutes with him and you knew right away that this guy was not a shop zombie and knew where he was going. Tod had quit school early because it was "not for him" he said. Back then I thought that Tod was doomed to remain in the factory for the rest of his life if he didn't go back to school.

How wrong was I! Tod was always willing to do overtime. Lots of it. And back then there was plenty. He said he needed the money. One day I decided to go ahead and ask him why he needed the money for. "To pay off my house" he said to me. "What? You're 20 years old and you want to... pay off your house?" "Yes" He said to me without further explanation.

A few days later I went to see him again. I was puzzled by how he would atchieve his goal of paying off a house so fast at such a young age. I asked him if the over time abuse he was performing had anything to do with that? He told me that this was one solution in the equation. But he had another card in his sleeve. He turned around and presented me his neck. Then he said to me "turn my colar". I did. "Now read the company name on the colar". I was able to read "Todd inc."

"What does it mean?" I asked him.

"It means that my company is the provider of some of of this shop's required clothing."

Now what a clever move! Not only Tod was using all he could from the company, making overtime and all. But he also recognized that the company had a need in clothing suply. He then registered a company, searched clothing warehouses. He tagged his name on the clothing and sold it to the very shop that was hiring him in the first place! Clever!

And by all that Tod was able to payoff his house, in his early 20s.

Tod is a good example of

1. Not putting all your eggs in one bag: most people would have been happy with one job and one pay check and would have done what they could with what they had. Without thinking out of the box. Tod not only collected the show's pay check. But he also started a company to increase his revenues.
2. Ressourcefulness: Tod was able to put his mind together, make the researches required to create a company and provide for a need. He was able to connect a to b (a being the shop needs of clothing and b him being able to fill that need).
3. Thinking out of the box: In the 80s, the idea of being 20 years old, school drop out and buying a house with the objective of paying off the loan in just a few years was at least alien to the current mentality back then.
4. Determination: Tod did what was needed in order to succeed in his project. By abuse of overtime and money generated from his own company he was able to do it. Yes he certainly had missed some fun partys and all back then. But who's laughing last? While Tod's friend are most probably paying off their own houses at this moment, Tod could very well be on some exotic beach right now, with a Pina Colada in the hand and a babe massaging his bodybuilder's shoulders.

The morale of the case study: if you're young. Go out there and make wonders. Just go ahead. There will be tons of people criticizing you. But who cares about them? You have one great advantage. You have the energy and the fast recovery hability of the young. Use it. And if you're older. Well as long as there is air in your lung the game is on. It is not too late to kick yourself in the but, watch less TV and go out there and make wonders too. You too possess an advantage that the young don't: experience. Use it.