In the next lesson, I’m going to get more specific about exactly what kind of business we’re going to build, but first we need to get past a fork in the road.
You’ve decided that you really do want to make money on the internet, and now there are two paths set before us…
(Watch this video…)
Main points:
Self employment vs. Business ownership. For many years I didn’t understand the difference. It will be beneficial for you to understand it before embarking on this business venture.
Cashflow Quadrant by Robert Kiyosaki: Employee, Self Employed, Business Owner, Investor
Each of these four quadrants make money in different ways.
Employees… You get paid for your time. You’re trading hours for dollars. You’re working for someone else, and in return they give you a paycheck.
Self employed people work for themselves. Like employees, they often trade their hours for dollars. Or perhaps they work for a fee or a commission. There are many examples of self employment, such as construction contractors, consultants, realtors, and even doctors in many cases. They’re not working for someone else, but their income is primarily dependant on themselves doing the work.
Business owners use leverage to make money. Most commonly, they hire people and leverage other people’s time. That way, the business owner doesn’t have to do the work and they can scale their business larger. The benefits of being a Business Owner rather than self employed are generally more freedom and ultimately more wealth.
Investor’s let their money do the work. They put their money to work making more money.
MYTH: You’re not making enough money. FACT: You need to be a better investor.
the Investor quadrant is for everyone.
If your goal is to never work, then ideally you need to end up in the Business Owner quadrant, not the self employed quadrant.
Virtually any self employment situation can be turned into a business owner situation if you know how.
The business model I’m going to teach you is really a combination of the self employment and business owner quadrants. And it’s going to be up to you if you want to fully leave the self employment quadrant and hire people to do the work that I’m going to be teaching you how to do.
Action steps:
1) If you haven’t read Cashflow Quadrant, read it. You can most likely pick it up at your local library for free, otherwise you can pick up a copy of it here on Amazon.
2) Determine which quadrant(s) you are currently in, and which one(s) you WANT to be in.
There’s no right or wrong answer, because it’s really a matter of personal preference regarding how you want to spend your time and how you want to make money.
As always, you are welcome to post your questions and comments below.
Have a great day!
I have been keeping up with your lessons Eric,
and Iam very impressed to say the least,looking
forward to further lessons!
Thank you
Shirley/Canada
Eric,
Thank you! You validated an idea regarding becoming a business owner. I’ve been stuck in self-employment mode for years. Now it’s time for me to make a move!… next lesson please?
thank you Eric for your valuable tips you send me i am very much in need for them as i am a beginner i hope u send me more ,may God bless you Thank you again mona/Egypt
eric thanks for all your lessons they are very helpful. for a newbie like me it is very very helpful. so i thought that i would go to eric,s forum to see what else i could learn but unfortunatly i do not like the pornographic material that it has on it. im not sure if you know about it but i figured i would mention it
thanks for letting me know… the forum was never mine, and it looks like Nico is no longer managing it.
I know that you had nothing to do with it. im sorry if i made it sound that way. i just thought that your name being associated with it you might want to know. because you are doing a good thing for people here and i really do appreciate it. i dont know where or how much money i would have spent if i hadnt found your help
thanks again dawn
I have been a big fan of Robert Kyosaki for a long time–actually got to meet him and tell him in person what his “Rich Dad” book did for me. After all my adult life being “self employed”, then finding I could not sell my business because I WAS the business, I began to move to online businesses. From physical products, affiliate sales and advertising, I now have a much wiser direction.
Do you own your business or does it own you?
Robert Kiyosaki’s books were all found at my coubty library….No price like $0!
All are worth the reading time!
Sharon S.
Great, I already read Cashflow Quadrant by Robert Kiyosaki, that why I come out to learn some thing new on internet marketing as I am no capital for others business.
I definitely recommend re-playing this lesson after reading Cashflow Quadrant. I, personally, listened to the audio book – Lately, it seems I’ve been reading so many eBooks and the like, it’s a nice break to be able to relax and listen. Coming back to the lesson, afterward listening to the book, really brings the it together.
Eric, what key points do you want us to take away from Cashflow Quadrant? Was the intent to better understanding the 4 quadrants? Or was it to change the way I think about producing money?
I would say the intent is both of those reasons. But the reason I specifically chose Cashflow Quadrant is for you to gain an understanding of the 4 quadrants, and to determine which of those quadrants you are in, and which ones you want to be in.
Being an internet marketer/business owner could fit with either the Business owner quadrant or the self employed quadrant. And the Investor quadrant is for everyone 🙂
I’m not sure if this is from the book, Cashflow Quadrant, or not, but I remember hearing: Being in the B quadrant means that you could actually step away from your business for an entire year and have it still be running efficiently. Is this really possible with Internet Marketing? Do you know anyone who’s reached this?
Yes it is possible to build your online business in such a way that it does not depend on you. Obviously the key there is outsourcing and/or hiring. To step away for an entire year you would definitely have to do some hiring, rather than just outsourcing. I do know people who have achieved this.
Eric, I have to say, I’m impressed. It’s nice to know that you’re actually responding to questions, quickly at that. I have a $97 purchased product from Mike Filsaime, that I’ve had an open ticket for some time now. It maybe that they’re busy with their Butterfly Marketing 2.0 release next week, but they should still be responding to tickets.
Back to the topic, I understand that business owners can outsource and/or hire. But, I meant more of the passive income of “set it and forget it” type business. Is there a point in a Internet Marketer’s career when they can have their empire of websites sustainably work for them, and not the other way around – without the ongoing tweaking or the need to create more sites, without outsourcing or hiring. Do you know people who have achieved this?
You know, I probably know the answer to this. Though there are techniques to try and sustain traffic and sales to your website,well after its prime, the content will get old, right?
Sure I know people who could take a year off, and their websites would keep bringing in income. I could possibly take a year off and enough income would be coming in to live off. BUT, in my case and in the case of others… that income would steadily decline.
If I want to take a 3 week vacation, no problem, the income will keep coming. But if I want to take a year off, I would need to hire people to do the stuff that I normall do to maintain my business and keep it growing.
Hi Eric!
You are the best! I am still learning your lessons despite I am 53. Your patient way of online lecturing will definitely increase the integrity and credibility of whatever you are intending to do. I personally hope others out there would be wise enough after listening to you not to be in a hurry to empty our wallet in order to be victimized by attractive scam as a result. If you were then well-versed in internet and had been scammed a few times, how on earth can we newbies do online business without having to know anything about internet as some affiliate programmers assured us that we do not need to…….
That is weird!
By the way, I personally like to know what if someone is willing to allow me to invite foreign students online to sign up educational courses in my own country. My country has many prestigious institutes besides government universities providing hundreds of professional courses where many other countries around us do not have and how should I develop a business website with a good domain name not formerly banned by Google, Yahoo and other SEO and an affordable web hosting altogether. I have downloaded once Bluevoda free business website not long ago but I have deleted it immediately when I heard some victims were complaining about its virus and scam. I was told in some blogs that many affiliate members who were given a free set up of business website but were suspended, freezed or disappeared with their earnings due to many valid reasons. Some said that their affiliate programmers were legally banned by the court of justice, jailed or had declared bankruptcy and some had kicked the bucket without a successor. Please advise.
Eric!
STEADY BOM-BEE-BEE!
Hi Eric.
A great day to you, thanks for the lessons so far. I enjoy learning from you.
The lessons are simple up to now, but powerfull in content! I’m being scammed many times, now i learn the lesson! thanks looking out for more fast lessons!
JUST A LITTLE STORY!
when i started to use the internet a year ago, i got many of those scam emails!
A guy told me he is veteran from the war who has some hidden money from Sadam’s treasure!
He wanted me to help him relocate the money!
He send me some seriuos warning not to tell anyone!I reply him,” i dont receive orders from scammers, and if continue i will put the FBI on his tail” and that was the end of his spamming!
hi,
I wonder, how come there are no google ads on your page? Just want to know the catch behind it.
Regards,
Raj
I explain in lesson #37 and #38 that Adsense is often not the best way to monetize a blog, as there are more profitable ways. In lesson #38 I talk about my objective for this site.
I have to say these tips really are great tips..no fluff or constant sales…really appreciate it!
http://www.helptobusiness.com
het eric you seem fairly level headed about what you see and how you see it.being married with 4 children and presently unemployed I belive in consistency and proper investment but being a newbee at this money game I all ready screwed my self not knowing how the game is played with I will give you this for $49.95 and then when that guy signs up they give him another come-on if you want the real site you could work with or the dopy fake site you can hve for free not to mention anoyher $99.99 it goes on forever they should just tell the guy this thing cost $350.00 and just be real about it they lead us newbees along they should just say this works its 300.00 and thats that
Eric,
I have a question about Amazon.com. I’ve noticed that a lot of ebooks are sold on Amazon. Is Amazon an online book store? Is it a viable way to sell ebooks that I’m writing or can I sell more through my own website? Maybe its another source, not the whole enchilada. I’d be interested in your thoughts.
Thanks. I’m off to the library for Cashflow Quadrant.
One of the definitions I use to help people put their arms around these quadrants is:
If you leave and the business stops, you are self employed, if you can leave and the business continues you have a business and if you never worked in the business it’s an investment. That’s not perfect, but it gets the point into the brain.
Thanks for the series.
Amazon started as mainly a bookseller, but have become a massive online retailer of almost anything you could think of buying. Yes you can sell ebooks on Amazon, but it’s probably not the best place to start. The method I teach is basically to sell it on your own website, and to drive potential buyers to it from a variety of places. However, amazon could be a good additional outlet to consider after your business is up an running.
Dear Eric,
Thanks so far for the lessons. You are good coach. Gd bless you and your family
Hi Eric, Thanks for the lesson. I was a self-employed and business owner for 16 years and then a car accident changed everything. I was in the mortgage business and worked out of my home for many years and then hired some people and my daughter did the processing. I ran the company and also did the commercial loans. I made good money but have since lost all of it after all the surgeries and medical bills. Even while healing I continued to work by myself in my home and made good money, then Colorado changed all the rules on owning a mortgage company. Because of the medical collections I could not get the proper bonds required by the real estate laws so had to go to work for Wachovia. I worked their as a mortgage consultant and then went on vacation, had a heart attack, and the whole department was laid off while I was in the hospital. Needless to say God has supplied but I have lost everything, and need to work at home once again. I still have my home but need to make extra income. I definitely am a self-employed individual. At this point I am not for others working for me once I get this started. I just trust that I can learn this and be a blessing to others in educating them on how loans work and what they need to know. I have done some lenses on squidoo and am currently getting my web page up. Please see my comment on your #1 lesson. I am a Christian and I know that
God will lead me in this. Just coming across your site has been an answer to prayer. I am praying that God will lead me through this and open my mind to understand on how all of this works. I am still confused about the traffic machines. Is there a place for me to go and learn about which one or ones to use?
Thank you so much for what you are doing and God Bless. I am thankful being on board.
Eleanor
Eric:
My goals seemed to coincide with your plan of action. To me that is SO COOL! I plan on being self-employed in my own businees until it grows to the point of needing additional employees. In fact, for my last project in my courses for my B.S. in Interior Design I was able to create (in the computer anyway) my corporate office for my business to build when I am ready to take my business out of my home. This will happen when I need space for employees and desire to carry a physical inventory. For now, dropshippers are a major part of my business.
Eric,
I thought I had responded to this lesson, but somehow it did not post.
I was so thrilled to see that my goals match what you have already been doing — work in 3 of the 4 quadrants. I have considered my e-commerce a business since its onset; however, the earnings have been minimal. I am self-employed right now and will continue to be until 1) the flow of merchandise gets to a point where I need help to keep up with the orders or 2) I decide it is time to support a physical inventory. The image of a brick-and-mortar/internet business is very strong in the back of my mind. Because of my studies in Interior Design, I have already designed my future corporate office which will include six additional employees.
Investment question: Is 10% of sales a good starting place to get into the habit of investing? I know 10% of a small order isn’t much, but it can build in a credit union savings account.
Louise
I would not consider myself an investment “expert”, but yes I think that would be a good start. Really I think you’re talking more about savings than investment. And 10% would be a good amount to put into savings. As you build a business, initially you will probably invest much of the profits back into the business. As your profits grow, you would be wise to invest a higher percentage of your profits into a variety of investment vehicles.
The tips that I’m learning from Eric is definitely going help me in the long term. The cash flow quadrant is very educational. I read that book in network marketing few years back, and I really encourage everyone to going get it. after reading it you will never think the same way like the 95% of the people.
twitter.com/sam1847
I look forward to receiving my “Eric’s Tips” everyday.
Thank you very much for the help.
Hi Eric, I have always been an employee and an investor. I will read Cash Flow Quadrant as soon as possible!
Thanks
OH…I am now in all four quadrants but as a business owner I am just starting out.
Thanks for the great tips Eric
Eric, it’s a go for me, wish to become all those quadrant, yet need very much to learn more from you, thanks for this lesson.
Eric,
I have read Rich Dad Poor Dad and it was eye opening. In it was mentioned the 4 Quandrants. I will get me a copy. Keep up the good work.
This is cool understand this breakdown of what we do. I’ve been in all four of the quadrants myself and am currently in 3. I’m building an online business while hanging on to my current job and have some investments.
For anybody interested, I offer a FREE Newsletter that comes equipped with a swift cash plan of action. Just click on my name above to subscribe.
Thanks,
-Casey Peacock
Hi Eric,
I will obviously start at being self employed after working for the last 45 years for other people and making them rich.
Regards
Butch Hannan
Hey Eric,
Is there any way you can put your lessons on your site in just audio to be downloaded and put on an mp3 player?
That’s not a bad idea, I will definitely consider it, but it will probably be a couple months until I can implement it.
Hi Eric,
I am a HUGE fan of Robert Kiyosaki. Have read most of his books and and have learned so much about investing from him. My wife and I have personally met him and his wife Kim at a convention in Johannesburg, South Africa. He has much to teach us and I highly recommend his books to people who want to be successful.
Thank you for your lessons. John
Hi Eric ,very good topic of our lessons.I am now retired and I know what I want to Be.
Thank you very much!
angie
I would like to earn even half that money you mentioned.
very Interesting&useful for me and evrybody
hai Eric my humble gratitude to you and your family for all the wonderful lessons worth millions iam already promoting this website to all my friends i hope you will guide to financial freedom GOD BLESS YOU AND YOUR FAMILY
Eric
Thanks once more. The lessons are simple and easy to follow. I have deleted all the emails that sre selling there busness on line and I am staying focused. The lessons you send are short and sweet with no information overload. they are practical and make a lot of sense. As a teacher looking to become a self employed Business owner your method of training can be followed by anyone who can read and understand the English Language anywhere in the world, I know I am from the Caribbean anbd I do appreciate your efforts. Thanks once again. Lana
Hi Eric!
You have a great gifting for teaching! Thank-you for taking it upon yourself to teach this- it’s really valuable.#
God bless!