@Codie_Sanchez: How to spot a scam...They pr...
@Codie_Sanchez
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Mar 29, 2024
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How to spot a scam...
They promise "passive income."
Here's the problem with passive income (and what you need to build instead:):
They promise "passive income."
Here's the problem with passive income (and what you need to build instead:):
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I've spent my career investing in & buying biz's.
First at huge investment firms, then on the side, and now for my own funds.
To date, I've built a $50M+ portfolio of small businesses in boring industries. And there's a truth I need to share with you:
First at huge investment firms, then on the side, and now for my own funds.
To date, I've built a $50M+ portfolio of small businesses in boring industries. And there's a truth I need to share with you:
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Passive income is a myth.
If money for nothing was real, wouldn't everyone be doing it?
In reality, generating "passive" income ALWAYS requires significant work upfront. Take real estate:
If money for nothing was real, wouldn't everyone be doing it?
In reality, generating "passive" income ALWAYS requires significant work upfront. Take real estate:
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Passive enough once the rent checks start rolling in, right?
But think about the work to get there...
• Researching markets
• Securing financing
• Fixing properties
• Finding tenants
Years of skill, sweat, and smarts.
It's the same for other supposedly 'passive' plays...
But think about the work to get there...
• Researching markets
• Securing financing
• Fixing properties
• Finding tenants
Years of skill, sweat, and smarts.
It's the same for other supposedly 'passive' plays...
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Whether it's dividend stocks or digital products, you need huge upfront investments of time and money.
Don't get me wrong: I'm a huge believer in setting up income streams.
But it's irresponsible to peddle the myth that you can get something for nothing...
Don't get me wrong: I'm a huge believer in setting up income streams.
But it's irresponsible to peddle the myth that you can get something for nothing...
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Passive income is a lie most often sold to the young, broke, or desperate.
But really, I don't think we even WANT passive income...
If you say you don't want to work, the truth is probably closer to this:
You don't want to do meaningless work forever until you die.
But really, I don't think we even WANT passive income...
If you say you don't want to work, the truth is probably closer to this:
You don't want to do meaningless work forever until you die.
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The point of life isn't to sip a tequila in Cabo on your "passive income" money.
It's to let out that thing inside you and leave it stamped on the world.
If you don't understand this now, you will – or you'll die uncompleted.
It's to let out that thing inside you and leave it stamped on the world.
If you don't understand this now, you will – or you'll die uncompleted.
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But even more dangerous...
The average American has just 1 income source: their job.
It's Russian roulette with your financial future.
Say you get sick. Your employer closes. You piss off the wrong person & get fired.
That's it.
But the average millionaire?
The average American has just 1 income source: their job.
It's Russian roulette with your financial future.
Say you get sick. Your employer closes. You piss off the wrong person & get fired.
That's it.
But the average millionaire?
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The average millionaire has 7 different streams flowing in.
If one dries up, they've got 6 others to keep them afloat. That's the power of decentralized vs centralized income:
If one dries up, they've got 6 others to keep them afloat. That's the power of decentralized vs centralized income:
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Decentralized income means you're like a computer network.
If a hacker gets to your one income stream, you just revert to a backup servers.
Your income is diversified.
It's not moving in 1 vertical. It's horizontal too.
If a hacker gets to your one income stream, you just revert to a backup servers.
Your income is diversified.
It's not moving in 1 vertical. It's horizontal too.
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So, instead of "passive income"...
The better goal is "horizontal income."
The better goal is "horizontal income."
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Horizontal income is money coming in from different, unrelated sources. You stack them, side by side.
If one goes? The others still work.
Meanwhile, vertical income comes down to you from above - like a salary. The tap can turn off anytime.
If one goes? The others still work.
Meanwhile, vertical income comes down to you from above - like a salary. The tap can turn off anytime.
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So where do you find horizontal income?
The first thing I do is a P&L review:
Look at all the things I spend money on and figure out how I can turn my costs into profits.
Take a laundry business:
The first thing I do is a P&L review:
Look at all the things I spend money on and figure out how I can turn my costs into profits.
Take a laundry business:
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One of the biggest costs? The soap.
So why not buy a mixer of commercial-grade soap, brand it, bottle it, cut costs 30-50%...
Then go sell it to your competitors under a different name?
If you're spending money on it, your competitors probably are too.
So why not buy a mixer of commercial-grade soap, brand it, bottle it, cut costs 30-50%...
Then go sell it to your competitors under a different name?
If you're spending money on it, your competitors probably are too.
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Other horizontal income ideas:
• Royalties from books you write
• Cash flow from rental properties
• Dividends from stock investments
It's not for the faint of heart: multiple streams take time & varied skill sets.
I'd approach it like this:
• Royalties from books you write
• Cash flow from rental properties
• Dividends from stock investments
It's not for the faint of heart: multiple streams take time & varied skill sets.
I'd approach it like this:
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1. Keep your main gig to pay the bills
2. Pick a side hustle in an area you enjoy & start on nights/weekends
3. Reinvest profits into cash-flowing assets (e.g. real estate/dividend stocks)
4. Repeat until you're at 7 figures
2. Pick a side hustle in an area you enjoy & start on nights/weekends
3. Reinvest profits into cash-flowing assets (e.g. real estate/dividend stocks)
4. Repeat until you're at 7 figures
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Want to know my favorite form of horizontal income?
Buying businesses.
In biz-buy-land, horizontal income becomes horizontal acquisitions becomes a bigger ecosystem to profit on.
Plus...
Buying businesses.
In biz-buy-land, horizontal income becomes horizontal acquisitions becomes a bigger ecosystem to profit on.
Plus...
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Buying beats starting a biz from scratch.
When you buy a biz, the hardest part has already been done for you.
Your job becomes maintaining and growing that success - not manufacturing it from zero.
When you buy a biz, the hardest part has already been done for you.
Your job becomes maintaining and growing that success - not manufacturing it from zero.
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My mission is to create 1 million financially free humans.
That's not gonna happen through "passive" income. That part's a myth.
What's not a myth is the ability get rich doing something you love.
But let's be clear...
That's not gonna happen through "passive" income. That part's a myth.
What's not a myth is the ability get rich doing something you love.
But let's be clear...
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You will have to get your hands dirty.
There are no free lunches.
But once you make your first $$$ OTHER than your salary?
There are no free lunches.
But once you make your first $$$ OTHER than your salary?
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You'll never be the same.
You've taken the first step towards freedom. And it's addicting.
You've taken the first step towards freedom. And it's addicting.
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I post more here about all things business and financial freedom.
Follow @Codie_Sanchez if you're into that, and feel free to share this here:
Follow @Codie_Sanchez if you're into that, and feel free to share this here:
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PS - there are a few more horizontal income ideas in this guide:
contrarianthinking.biz/3uzVaS6
contrarianthinking.biz/3uzVaS6