Systematic Wealth, Chapter 1

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Systematic Wealth, Chapter 1

  1. 1. Systematic Wealth Chapter 1 <ul><ul><li>By Peter Nguyen </li></ul></ul><ul><ul><li>CEO & co-founder </li></ul></ul><ul><ul><li>Talentelle </li></ul></ul><ul><ul><li>[email_address] </li></ul></ul><ul><ul><li>www.talentelle.com </li></ul></ul><ul><ul><li>Workshop creator </li></ul></ul><ul><ul><li>www.businessmodelworkout.blogspot.com </li></ul></ul>
  2. 2. <ul><li>So Peter, let me ask you a straight question... </li></ul><ul><li>Wait, who are you? </li></ul><ul><li>I'm a fictitious reader that you invented to create the illusion of a live, spontaneous conversation. </li></ul><ul><li>Oh right, right... Okay, go ahead. </li></ul><ul><li>What is the secret to wealth creation? </li></ul><ul><li>The secret actually has two parts, and both parts were mentioned by none other that Albert Einstein himself. </li></ul>
  3. 3. <ul><li>He said, on the evening that he received his Nobel Prize, that the most powerful force in the universe is “compound interest.” I will explain this further, and also a cousin concept called “compound iteration.” </li></ul><ul><li>And the second part? </li></ul><ul><li>He said: “The most imcomprehensible thing about the universe is that it is comprehensible.” </li></ul><ul><li>What does that mean? </li></ul><ul><li>It means that what Einstein, the great genius, did not understand what the fact that he could understand! </li></ul>
  4. 4. <ul><li>Okay, but what does that mean for the rest of us ordinary folks who are not geniuses? </li></ul><ul><li>It means that the universe is rational, and that through our mental faculties, we CAN figure out its secrets and make it work for us! </li></ul><ul><li>It means that becoming a millionaire is a scientific process, and that if you want to become one, all you have to do is follow a rigorous, systematic process. </li></ul><ul><li>So that's why you titled your book “Systematic Wealth.” </li></ul><ul><li>Yes. </li></ul>
  5. 5. <ul><li>I wanted to emphasize, above all, that wealth is the result of a systematic process. It doesn't require that a person be super-smart or highly talented. You just have to create a system that works, and keep making it work better and better. </li></ul><ul><li>All entrepreneurs understand this. That a business is a system that works like a well-oiled machine. A business is not personal, it's systemic. Michael Gerber wrote a brilliant book (“The E-Myth”) to explain the systemic nature of a business. </li></ul><ul><li>Can you provide examples of business systems? </li></ul>
  6. 6. <ul><li>Sure. Youtube is a system. It allows people to upload 65,000 videos every day. And about 100 million videos are viewed every day on Youtube. </li></ul><ul><li>But why did Google buy Youtube for $1.65 billion? </li></ul><ul><li>Well, the two young Youtube founders, Steve and Chad, understood something very well. People love to communicate. In this case, they communicate through the sharing of social objects called videos. So they leveraged this technosociological trend and converted the “talk & share” environment of Youtube into a “work & capitalize” environment for Google. </li></ul>
  7. 7. <ul><li>I'm not sure I understand... </li></ul><ul><li>Let me put it this way: People are fish. Youtube was the bait. And Google is the fisherman. </li></ul><ul><li>So the Youtube founders were able to create a system that created wealth? </li></ul><ul><li>Yes. Skype did the same thing, and eventually sold out to eBay for 2.5 billion dollars. </li></ul><ul><li>But these are exceptional examples. Can you provide an example that ordinary folks like me can relate to? </li></ul><ul><li>Sure. Most people have a job. That job is part of a system for creating wealth. </li></ul>
  8. 8. <ul><li>However, since people do not own their job, they are at risk. In other words, an employer can eliminate a job anytime. </li></ul><ul><li>Does this mean it's better to be a free agent or a business owner? </li></ul><ul><li>Not necessarily. What's important is that you own a system for creating value. That value can be professional services that, as a salaried employee, you offer to an employer or to a client (if you're a free agent or independent consultant). That value can also be offered as a product or service, if you own a business. </li></ul>
  9. 9. <ul><li>So you're saying that the Systematic Wealth doctrine can apply equally to employees, free agents and entrepreneurs? </li></ul><ul><li>Yes. </li></ul><ul><li>Can you explain what the Systematic Wealth doctrine is? </li></ul><ul><li>It's a simple doctrine based on the principle of “economic justice”: a man shall reap what he sows. </li></ul><ul><li>In other words, income depends on outcome. The more value you produce, the more money you will be paid. It's that simple. </li></ul>
  10. 10. <ul><li>But how come most people have a fixed income? Does that mean the amount of value they produce week after week is the same? </li></ul><ul><li>No, of course not. Through the learning curve and improved skills and acquired experience, people actually create more and more value as the weeks go by. </li></ul><ul><li>But their salary remains the same. </li></ul><ul><li>Yes. The “surplus” is not distributed to employees but is kept by business owners. This is how the rich get richer and employees, well, do the best they can with the paycheck they get. </li></ul>
  11. 11. <ul><li>That doesn't seem fair... </li></ul><ul><li>Business owners would say that it is fair, since those are the terms of employment. Nobody is forcing people to keep a job. If they're not happy, they are free to resign and find another job. </li></ul><ul><li>How does Systematic Wealth help people to achieve financial freedom? </li></ul><ul><li>First of all, it's important to discuss an important point: What do people really want? Money or life? </li></ul><ul><li>I think it's fair to say that most people want “life” or “discretionary time” to spend as they wish. </li></ul>
  12. 12. <ul><li>Right. So it doesn't make much sense to talk about “financial freedom.” What people really want is to have as much free time as possible, so they can spend it doing their favorite activities in the company of people they love, like family and friends. </li></ul><ul><li>So you're saying that people don't want to become millionaires? </li></ul><ul><li>Exactly. I think people really want the freedom to lead their favorite lifestyle. They want to work as little as possible. Working only 5 to 10 hours a week might be a good goal to aim for. </li></ul>
  13. 13. <ul><li>So how can people achieve that five-hour work week? </li></ul><ul><li>Well, they have to think in terms of systemic performance and NOT personal performance. This switch in mindset is hard because we have been culturally conditioned to think that “work” equals “money.” </li></ul><ul><li>We have never been introduced to a powerful concept called “passive income.” This is where you earn money while you sleep. That is, you've created a system (of people, processes and technologies) that delivers value to your clients WITHOUT your being physically or intellectually involved. </li></ul>
  14. 14. <ul><li>You mean a franchise or systems like that? </li></ul><ul><li>Yes. But such a business system doesn't have to be documented in detail like a franchise. It could just be a micro-business with one employee. Of course, this should be an employee that you really trust and who is capable of running your business without you being present. </li></ul><ul><li>So my million-dollar question is, How can I create such a business system so I can become rich? </li></ul><ul><li>You know what? I'm getting hungry. And I'm sleepy. </li></ul>
  15. 15. <ul><li>Remember: as an author, I don't have employees writing this book for me so I've to actually write this stuff myself! I need a break! :-) </li></ul>
  16. 16. <ul><li>To read the following chapters of this book, titled “Systematic Wealth”, please write to me at [email_address] while mentioning “chapter 2” in your email. </li></ul><ul><li>Good luck in all your endeavours! </li></ul>

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