Multiple income stream, scaling and the riches?

[donald]

I think(generally)your best off focusing on the one income stream out of the 4 that has the most promise and focus solely on that.Better to have one ''bigger & growing'' stream than 4 smaller one's.otherwise you'll be scatter brians.Along the lines of-he who carries too many baskets must put one on his head and if one basket falls all other's are in jepordy.

Most people that are sucessful focus on one thing and put all there concentration in it(i think this holds true).That would be the safest bet.and once you start hiring-- each employee added is a new income stream(or machine)build your income streams off one idea/avenue and multiply that way.Maybe offer your employee(s) piece work rates(so you have a easier fixed amt of labour attached to each item-perfect if your selling unit based products)and you know how much your mark-up(profit) is(instead of fumbling around with hourly pay/salary)Set-up a system that is scaleable from the onset.Look for one or 2 big clients right away*team up with* that need your services(so you don't have to ''sell'' always/forever)network that way,through and around there network(then branch out to outer sales along side your bigger clients).Then you can start multiplying money on the operations side(buying your bulk cheaper from your supplier's ect ect)If it's(similar to ''woodworking").That's what i would do.Sounds like you could plan/build this way with your product.What type of product/machine are you selling/building?who are your clients?

[Just a Guy]

Well, the other thing to consider is selling off the successful ones you don't want, or even all if you think they are too small, and investing the capital into a new, higher margin one. Business flipping can be a profitable way of working...most franchises have people who make fortunes starting the business and then flip them when they become stable to start the same franchise somewhere else.

[Rusty O'Toole]

The Bill Gates Computer Software and Storm Door Company..... The Donald Trump Real Estate Development, Ice Cream, and Athletic Shoe Company..... The Warren Buffet Stock Investing, Car Wash and Self Storage Company.

The best, most successful investors and business people seem to stick to one thing. They may branch out into other fields but only grudgingly, if the opportunity is too good to miss, and is in an allied field.

Like Donald Trump who went from a Manhattan hotel, to Manhattan commercial and apartments, to Atlantic City hotel and casino investments. All represented real estate fix up deals and all entered into after much research and analysis. He did not go into anything he was not familiar with.

Same with Warren Buffet. He invests in many businesses but always from the standpoint of the value investor. He carefully analyses each investment and buys only the best and safest. He does not want to run any of the businesses he invests in, he leaves that to the experts. In fact he has said many times that he prefers to invest in businesses any dummy can run because sooner or later, a dummy will be running them lol.

Bill Gates of course is famous for computer software and nothing else. When he started I did not think there was that much money in computer software. I was wrong. Lucky for him, he did not take my advice to branch out into a few sidelines in case the computer thing didn't work out lol.

In other words if you have one good business or investment idea that is enough. If you don't, having 4 or 5 bad ideas is not the same. Pick the one you like the best or the one that draws you to it, and become an expert on that. Stick with it until you master it, or until you find out it will not take you where you want to go.

It is VERY hard to be an expert in even one field, by that I mean being good enough at any investment or business to make money at it. To do 3 or 4 really well at the same time is impossible. You will only kill yourself if you try.

[Causalien]

Specialization and focus seems to be the theme nowadays. I still remember a time when putting "multitasking" in your resume is a must. But I think I am shifting towards focusing on one thing now, however it does not mean that the original premise is wrong. The multiple income stream idea works and is giving me a comfortable life, but it is not enough to be great.

Speaking of multitasking, Elon Musk is probably a good example of success with this method. Is this method an outlier? Did anybody else you know of succeeded with this path instead of the focus path?

[Rusty O'Toole]

The multiple stream of income idea is more or less bullshit. The first I saw it was a book, Multiple Streams of Income by Robert G. Allen the former real estate guru. I say former because he went bankrupt then came out with the multiple streams book.

Another one who is big on multiple streams of income is Robert Kyosaki another obvious phony. I have read his books too, and if you follow his advice you will get hurt badly. His first book was total bullshit written by someone who obviously knew nothing about business or investing, but told a very plausible story. His later books have a little bit of merit. Once he got the dough from his first book he did learn a little about handling money. But he is still all about scamming the suckers.

The reason I say "more or less" bullshit is that the main thrust of the idea is bullshit. You will do better to concentrate on one thing. But you can still diversify your investments. Just don't try to juggle them, or be an expert in everything at once.

In my case, my main investment for the last 35 years has been real estate. That is what I concentrated on. Now I have only a few rental houses so that takes a minimal amount of time. I also have some gold and silver in a safety deposit box. That requires no care or effort, I regard it more as insurance than an investment, although it has done well over the last 5 years, even though I never look at it.

Now that those things are set, I am learning about the stock market. But note, I did not jump into 4 or 5 things at once. I did one thing, mastered that, then either got out of it, or set it up to take minimal effort to run.

That is what diversification means. You might own your own home, have some insurance policies, possibly some precious metals stashed away, and your stock portfolio. That would make sense. Trying to run 4 businesses at the same time, does not.

[Rusty O'Toole]

As far as Musk goes, it appears he started his different ventures one at a time, got other people to run them, then went and did something else. He did not try to do all of them at once, or to do all of them himself.

Another guy who operated in a similar way was Howard Hughes. He started with his father's machine tool drill bit company, left that in the hands of a manager when he went to Hollywood, got into movies (RKO) started his own airplane company and a lot of other things. Most of his ventures lost money as long as he was running them, supported by Hughes Tool profits, and only became profitable when he lost interest and handed them over to a hired manager.

On the other hand, maybe you can start and run 4 successful businesses at once if you are a) a super genius and b) have a few billion dollars to invest. Mortals like me, Warren Buffet, Bill Gates and Sam Walton will keep on doing things the easy way.

[Rusty O'Toole]

You mention a stock trading algorithm that makes $20 a month but won't scale because it is a niche market. I would follow up on that. Is there a way to develop another algorithm, or some other method to exploit a larger market? With the experience you have now it should be possible . I know I couldn't do it because I don't have the skills but you do. That is what I mean by sticking to the same line. Donald Trump didn't keep renovating the same building over and over, but he used the same skills, contacts and knowledge from one deal to the next.

[Lephturn]

5 years ago I spent two weeks creating and recording a video training course for an online video training company. I get royalties - that is true passive income at this point. I still get a very nice cheque every month from that one course. Think car payment. I can't do any more in my current situation unfortunately - but I have a friend who has done over a dozen of them - not all as successful as mine (My topic was Outlook 2007 training) but those streams of royalties are extremely valuable when they are totally passive, even if individually they are small. It's worth working very hard for a short time to set up something completely passive like that. Think about intellectual properly that once created can funnel money to you with absolutely zero extra work.

I agree that the way to go is to focus on one revenue stream at a time - scale and grow that one and ensure it will eventually be totally passive - then move on to the next one. I've only managed to get a couple up and running - but wow they do add up! Just be sure to focus on things that can be completely hands-off in the long run. That may mean selling a business or idea to somebody else and simply collecting royalties.

This is why I love dividends.

[Causalien]

Some clarification

Some of them are completely hands off. Some requires occasional attention when things break down. All of them started off as a $20 idea, but they earn much more now. The stock algorithm is the most time consuming since I need to check the balances at the end of the day as it is more prone to do something catastrophically wrong (computers manipulating your money? Same worry as letting computers drive your car). It hasn't gone skynet yet though. So multiple income stream works for me, but you also get this mess that I am in right now. So I am glad I get to learn about the true stories of all those advocates of multiple incomes.

For musk, I am referring to his multitasking Tesla and SpaceX, but I get the fact that it's because has has the capital to hire great people at both companies. Also, the US government is probably grooming him as the next tech icon, so he gets more break than most. Reading his past, it looks like unless you are a rich billionaire, you cannot afford to divide your attention.

Anyway, it's great to have come to a decision for the next move. Unfortunately it won't be anything beneficial to this forum since I regard the stock algorithm as just a leech in a zero sums numbers game that is not helpful to life.

[Just a Guy]

I guess Rusty, you haven't heard of Trump water, Trump board game, books by Trump, TV shows starring Trump, Trump appearing on WWE wrestling, Trump teddy bears, Trump vodka, Trump perfume, Trump steaks...then there are golf courses, miss universe, miss America, casinos...

Sounds a little diversified to me....

Didn't he nearly lose everything a few years prior to diversifying when his real estate empire collapse?