The wealthy don’t hunt for penny stocks and cross their fingers on doubling their investment. They also don’t blindly invest in index funds to earn a mild 7% year after year. Instead, they look for investments that they can be a part of and influence. One of the reasons the rich get richer….is because of direct investing.
By direct investing, I simply mean wealthy individuals that are actually meeting with potential business owners and listening to their ideas. If you’re a TV watcher, think Shark Tank. The rich investor grants an entrepreneur time to pitch their idea. If the investor likes what he hears, then he’ll look more carefully into the details, and then offer the entrepreneur some funding in exchange for partial ownership of the business.
Rich investors love direct investing because they can keep tabs on the business at all time (after all, they often have controlling interest) and can make it a tremendous success with their experience and their connections.
Action Items:
- Get completely out of debt and stock up some cash
- Get to know bright individuals through universities and young professionals clubs
- Begin investing with small figures and learn as you go
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