What Growing Up Broke in a Rich Neighborhood Taught Me About Business
I grew up in a single-mother household, like the other one of four of you out there. I also grew up in a very nice neighborhood called Westlake Village, which is north of Los Angeles and is a close neighbor to Calabasas. (Thanks to the Kardashians, many people know Calabasas these days.)
My mom worked two jobs so my siblings and I could live in a nice area because she wanted us to go to good schools and reap the benefits of a nice community. This is important for two reasons: In other areas our dollars could have gone further, and because of the nice area a lot of my friends and their families had extreme wealth (such as mansions with movie screens), which made our financial situation appear even more bleak.
This unique experience actually worked out to my advantage, and some of the lessons I learned helped shape my perspective and outlook on life and business today. Here are nine lessons I learned that can help you with your startup:
1. The art of bootstrapping.
Apparently I was bootstrapping before I even knew the term. Bootstrapping in the startup sense refers to denying outside capital to build and grow your business by using founder resources. In the general sense it relates to maximizing your resources and leveraging everything to make the biggest impact.
An effective bootstrapper learns where to cut costs, how to allocate and manage precious resources, how to maximize the impact of said resources and ultimately how to thrive in spite of minimal resources.
2. Hard work pays off.
I saw this play out in two examples -- the first was my mother. She worked hard every day at both a day and night job, making sure we were fed, had shelter and had all of the things we desired.
The second example came from my friends’ parents. I was very close with a lot of my friends' parents growing up and saw what the fruits of labor could provide. I saw their parents getting up early, working late and working on the weekends. Most of them were business owners and the experience gave me a glimpse into the world of entrepreneurship.
3. Circumstances aren't permanent.
My family's situation eventually changed. We all worked together to make changes, grow and evolve. Understanding this important lesson about circumstances has helped me endure difficult times when building startups.
Circumstances are not permanent, and even more so, in difficult times there usually lies some sort of opportunity. If the gaze is fixed only on the negative, it can be easy to miss the positives that could be the result.
4. The risk isn't that crazy.
When I talk to people who are hesitant or afraid to start their dream businesses, I ask them to visualize worst-case scenarios. They usually get to the “but I might fail” part. I ask them to go further. They say their electricity gets turned off, they have to downsize their living situations and they spend their savings.
Don’t get me wrong, those things totally suck, but there are definitely worse things such as losing a loved one, brain damage or even death. Using my experiences growing up, I realized early on that the risk really isn’t that crazy, and definitely worth the upside.
5. Top Ramen works.
Bootstrapping businesses and pre-revenue startups typically don’t have a ton of resources. I’ve built countless startups without an income. Needless to say that meant figuring out how to eat on a shoestring budget.
This was not so different than when I was growing up, so when push comes to shove, I know how to thrive in those circumstances. If you’re in that situation now, put down the Ruth Chris menu, and head over to the Top Ramen aisle. Figure out the resources that cost less and that work, then utilize them.
Remember, circumstances don’t last forever, but do whatever you have to do to get through these points.
6. Real world hustle.
During my teenage years I learned how to make money. I did not have the things I wanted, so I learned how to go out into the world and get them. This hustle has afforded me countless opportunities as an entrepreneur and empowered me to be an effective leader that operates from real world experience.
7. Opportunity is everywhere.
In my mind, opportunity is infinite. The world is a huge place full of endless adventure, new ideas and favor. Having been exposed to both little and much as a young person, I realized that what one person may see as an obstacle another person may see as opportunity.
For example, when the market turned in 2008 some people I knew saw the world collapsing and liquidated everything, while others were buying up property and stocks. There are endless examples, but I learned that opportunity lies in the eyes of the beholder.
8. It’s alright to have money.
I’ve been on all sides of the spectrum and can say that having money is better than not. Money is not the root of all evil -- people abusing money is. As long as money is not the idol, having money can be a good thing. Money can help provide you the freedom you want, it can help you help more people and can be used for good.
There are bad people with money, and bad people without. There are good people with money, and good people without. It is OK to have money and nice things. It’s what you do with it that really matters.
9. Money isn't everything.
I’ve experienced overwhelming peace and joy in the darkest of hours, and conversely have seen doom and destruction in what appears to be the “good life.” At the end of the day, money is simply a tool we use to accomplish objectives. It is a means to an end, and will never be my primary driver.
I’m grateful for all of my experiences -- the good and the bad. I’ve learned that with the right mentality and perspective disadvantages can be turned into a competitive advantage and driving force. We discuss these types of lessons and tons of others in my private Facebook group for entrepreneurs. Join us here.