Business of The 21st Century

If your life is like a ladder and you’re trying to go as high as possible, do you ever stop to think if your
ladder is even planted at the right spot?*
Cash Flow Quadrant:

E: Employee, focusing on Security (Job Security + Pay + Benefits but trade time for money).
Colleges train people to be employees.
S: Self-employed small business owner (Strive for Independence but are slaves to their
business..if they quit, the business will not run). This is a trap too because if you take a day off, you don’t
earn money and you can’t blame anyone for your problems because you are your own boss.
B: Business owner (Wealth building…they build teams, want to work with as many people as
possible)
I: Investor (Financial Freedom…using own money to have the money work for them)
80% of the population is in the E and S category
Poor Dad talked about working his whole life and getting a really great job but essentially, he still fails
because his income does not grow far greater than his expenses or liabilities. Rich Dad builds assets that
grow passive income that allows him to pay his liabilities and then reinvest whatever is left to keep
building his assets.
Until you have residual income that pays for living expenses each month, you won’t ever be free. Most
people live paycheck to paycheck.
Is there any way to go from E to B? There is…called Network Marketing.

Network Marketing:
1. Your goal is to build your network, real money comes from building a big network of customers
and distributors. Allowing a lot of people to do a little bit.
2. Your job is not to sell a product, but to connect and build relationships
a. You invite them to experience the products you are excited about and take a look at the
information you have, and then follow up with them. Then, once they’ve decided to join
you in the business, you share with them your enthusiasm, your experiences, and you
help them learn to do what you have learned to do.
b. Build a team culture, build a strong community around your network marketing so that
attrition won’t be a problem because everyone wants to belong to something.
3. Product is important, but your network is even more important.
a. The richest companies in the world have large networks like amazon, ebay, AT&T,
Verzion.*
b. V = N^2, if your network grows, your economic values grows exponentially.
Notes:
1. Getting a company typically takes 5 yrs. Takes 10,000hrs to become an expert at something.
2. Keep your day job to lean on financial support. You shouldn’t be using the income of your new
business to burn monthly living expenses.
3. No such thing as get rich quick, and people in the E and S quadrants are the ones easily exposed
to it.
4. With typical franchising, you are part of a network, whereas network marketing, you own the
network.
a. If Henry Ford hired a few people to create a few special cars, he’d have a few thousand
sales but he hired people to do simple ordinary tasks which produced millions of cars.
5. It’s hard to tell someone who has a job why they shouldn’t have one because most people have
the employee mindset, they’re programmed that way.
6. The harder you work, the more your income gets taxed and with no tax incentives vs a small
business. You get significant tax advantages being in the B quadrant.
7. Wealth is determined by the amount of months you can survive, not the amount of money you
have.
8. Losing is part of winning, failing is a part of success.
9. Theres three types of education: scholastic, professional, and then financial. Financial is where
you learn to have your money work for you.
a. It’s your financial intelligence that will make you rich.
10. Getting to the B and I side:
a. You can plan, learn all you want, but people who take action are the ones who will
succeed in network marketing. You can’t expect results right away and you have to put
in work.
b. You have to unlearn too. If you’re coming from the E or S quadrants, you have to
unlearn your mentality.
c. You need that consistent entrepreneurial spirit to stay on the B and I side
d. You have to surround yourself with individuals with your own mentality or else you’re
going to be held back*
11. More than half the companies in the Dow Jones index were created during a recession. Because
when times get rough, people get out of their comfort zones to make ends meet.
12. Jumping to B or I quadrant entails leadership qualities: mental, emotional, physical, spiritual,
influencing others to be successful in whatever they want to be
13. Financial Freedom: Build a business, reinvest in your business, invest in real estate, let your
assets buy luxuries
a. 80% of lottery winners go backrupt within 3yrs
14. House is not an asset, it’s a liability. If you buy a house and sell it for higher, its not an asset, its
capital gains
15. “Money and success make you arrogant and stupid. Now, with some poverty and humility
behind you, you can become a student again.”
16. 88% of the people in business are women
17. You have to be happy and be passionate to continue making money
18. Only way you can become rich in network marketing is by helping others become rich in the
process. Personal success is much more fulfilling when you can help others create success as
well*. By design, it is the perfect business for people who like helping other people.
What to Look For:

You’re looking for the network, not the product.
Good companies will place a priority on developing your skills and your abilities.
Provides a proven plan of action
Leaders above you who are willing to train you and help you become the businessperson you
can be
Questions:
1. Essentially for Amazon to move to the B quadrant, he had to start off at the S quadrant right?
Still don’t understand Chapter 7: Network Marketing
2. Talks a lot about how investing in mutual funds that are capital gains taxed is pitiful and
investing in stocks is gambling…how does this relate to the “traditional investment piece of the 6
pillars”?

Business of The 21st Century

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Business of The 21st Century

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If your life is like a ladder and you’re trying to go as high as possible, do you ever stop to think if your

ladder is even planted at the right spot?*

Cash Flow Quadrant:

Is there any way to go from E to B? There is…called Network Marketing.

What to Look For:

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