Robert Kiyosaki, the author of “Rich Dad Poor Dad”, discussed the value the game Monopoly had in his education when he wrote that “you buy four green houses and trade them in for a red hotel.” The message here is that to have a successful business you don’t buy the red hotel right out of the gate. You build up your tacit business knowledge so that when you can afford the red hotel you are more likely to be successful.
The Wall Street Journal once printed an article that listed the five things an entrepreneur needs to build a successful business. The list was in the order of importance from most required to least.
1, Access to Capital
2, Business Acumen
4, Industry Knowledge
Most would-be entrepreneurs I see have some degree of the bottom three items (Energy, Industry Knowledge, and an Idea) but have little if any money or business acumen.
So how does one get money and business acumen? Start small and build from there.
If your idea is to open a restaurant, why not open a mobile hot dog stand first, like the ones in front of Home Depot? That sort of business costs a lot less to start up, and if you manage to mess it up you’ll learn some valuable lessons along the way without breaking the bank.
In addition to the knowledge you gained, if you’re successful you might now have the start-up capital you need to open your restaurant.
When it comes to building a successful business buy four green houses before you buy a red hotel
Related Post: Take Baby Steps To Avoid Business Failure
Are you trying to buy the red hotel before you learned your lessons by owning four green houses?
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