The Hustleman Chronicles

Hustling in the concrete jungle of Atlanta, Georgia USA isn't easy. My goal? Simple... to go from net worth zero to the making of my first million. Will I flop, or rise to the top? Truth be told, failure is NOT an option. E-Mail your Hustleman at : thehustleman@hustleandprofit.com for some personal dialogue, comments or questions.

Sunday, April 01, 2007

Real Game, Real talk #3: Profit VS. Payout - Creating Something With Nothing

Alright Fam here we go again. This is your Hustleman coming back at you from the streets of Atlanta, Georgia also known as the ATL and also know as the Dirty South. Spring is in full swing and I’m loving it! Without further delay let’s get to it.

Not to long ago I was pushed, so to speak, to stop beating around the bush and really break down Hustling. So I created this new series of posts entitled, “Real Game, Real Talk” to do just that.

If you missed the second post of this series then please CLICK HERE.

I am often posed a question similar to this: “I want to start my own business but I don’t know where to get the money. Should I get a bank loan?”

My answer to this is usually “No.” but it depends on the type of business you are starting. Now some of you are saying, “Wait just a minute Hustleman, how the hell do I start a business with no capital?” My answer is simple, yes you need capital to start a business but if you start smaller you won’t need as much. Let me explain.

Since I started as a street Hustler I’ve seen hundreds of dollars turn into a small fortune. I have done this myself so I know it’s very possible. As a Hustler, we don’t like to owe anyone anything. There’s no feeling quite like making some money only to have to hand it over to someone else. It takes longer to see your profit and the more money you’re paying out, the more difficult it is to grow your business.

It’s like that old adage, “Which came first, the chicken or the egg? Or in business terms; which comes first, looking good (professional) or making a profit?”

If your business isn’t about profit then all well and good, but if it is then shouldn’t that be top priority? That’s all I’m saying.

Most business loans require a nice amount of limitations and ridiculous interest rates, especially if you’re not sitting on some serious assets (real estate, inheritances, etc) and don’t have a nice stack of money in that particular bank. You want a $250,000 loan? Well do you have assets plus about $30,000 to $50,000 in the bank? I know I don’t. I’m exaggerating a little but follow me on this. The way we (Hustlers) see it, why ask someone else for permission to do what you want to do? Let’s get a little deeper shall we?

Let’s say you want to open a restaurant. Most people immediately formulate the idea of finding a location to lease or purchase, figuring out the cost of renting or buying the necessary equipment, then you need a marketing budget, employees (even if you use family members they still need to be paid to keep things as legal as possible for the IRS), you need tables, licenses, a business phone line (probably 2 or 3), printing, insurance etc. And it’s always a good idea to keep a lawyer somewhere close.

This all adds up very quickly. Most of your first 5 years in business (if you last that long), will be going to repaying your loan and advertising to get more money to… repay your loan and maintain your business.

All of this and somewhere in there you have to plan for growth. Anything that doesn’t grow eventually dies. That’s how nature works and that’s how business works also. Is it any wonder that most businesses fail within the first year, and the rest somewhere within the next 4 years?

So you may be thinking to yourself, what about getting a government grant? That’s a noble idea and one well worth pursuing IF and I stress IF you qualify; and IF you are eligible. I’m not saying don’t go this route (its well worth the effort), but if you or someone you know has ever attempted to get a government grant then you know what I’m talking about here. Don’t believe all that hype on those late night infomercials, it takes serious research and a solid business plan.

Now, what about investors? Good question, but this is similar to getting a bank loan. Again you need a solid business plan and make no mistake, investors want to see a return on their investment. Depending on your business model this may be the best route to go if you are sure you can deliver on time and are good at managing people. Investors are usually quite active in keeping tabs on what your business is doing. You’re accountable so that’s something you are going to have to deal with.

So let’s look at the Hustler’s way. I’m not saying it’s the best way because it does have its drawbacks, but you maintain one thing… complete control (at least until your business grows to the level you want it).

Are you still with me? If so let me further illustrate my point.

Example: How would I, a Hustler, start a restaurant?

Well to be honest I wouldn’t start a restaurant. I would make food out of the house and make it a point to make up some flyers and business cards to deliver to office buildings, construction sites and other businesses around the area. Think of it as a small food delivery service, not quite catering.

Another way to flip it would be to hitch or buy a unit to put on the back of a truck or van to keep the food hot and pay to stay in someone’s parking lot or at a busy corner downtown.

Of course I would keep it all legal with the proper zoning, licenses and permits… eventually. Meaning, when my business grew to the point enough to be “noticed”. That’s just what I would do, don’t take that and run with it LOL. Moving on…

I would start selling food and/or desserts right where I’m at NOW. Hustlers make moves, fuck the waiting. If I had a job, that’s where I would start selling. It’s also a good place for feedback on the taste, prices etc. All of this is free; you are only paying in time.

Instead of a few thousand or hundred thousand dollars to start, I could probably start for about $500. If I needed a vehicle to make the deliveries I would probably tack on another $5,000- $8,000 for a decent used van, truck or something (maybe just $1,000 if you could find one at a public car auction). I would put the menu together and be ready to change it on the fly to appeal to the customers wants and needs.

That’s just the start. I would then bust my ass to build clientele and slowly expand using profits. And using this method, you’ll see profits much faster than you would if you took out a loan. Are you with me so far?

Now here’s the good thing. As long as my customer service and food is up to par, I could eventually begin to save money. With this saved money I could then get everything I needed; the building, equipment and everything else.

Here’s the good part. I would ALREADY HAVE CUSTOMERS if I open up in the right location! That means I’ll be making money in my “official restaurant” from day one instead of dumping large sums of money in marketing. I would still market of course and probably still make deliveries if possible.

Here’s the bad part, this method would take some time to work but in the end I wouldn’t owe anybody anything. I pay my bills, count the cash and keep control of the direction and course of my business.

If I then decided to open up another location, THEN and only THEN would I go look for investors or go to the bank. What can they say then? I already have a profitable business, it doesn’t look like a liability or a “high risk” loan on their books. They know I have the skills to run a profitable business; I’ve shown and proven it.

If I structured everything correctly, I would already have a built in assets. No need to put up the house and spend the kids college funds.

See the difference?

Many of us have been taught to do business backwards. Meaning we want to look the part before we actually have the money to walk the walk. We Hustlers work the other way. We walk the walk first and worry about looking good later. We start small and get big, not start big and use up our most important asset, money.

This is real business Game here. I’ve seen it done and I’ve done it and am continuing to do it. It works, bottom line. Simple.

Peace and blessings Fam and please remember if you’re not happy right now it’s only because things are not happening (happy-ning) your way. So change that or stop complaining. Keep it moving and keep it simple… always.

*** Unparalleled Business Game ~ Home Based and Small Business strategies, techniques and tricks of the trade straight from your Hustleman:

Learn this thing we call The Game. CLICK HERE.

3 Comments:

  • At 8:51 PM, Anonymous Anonymous said…

    Anything you put your mind to can and will come to light. I support, any and everything you do. With hard work, everything will come together in due time. I got your back babe.

    Mz. Lonnie ;)

     
  • At 1:46 AM, Blogger Dami said…

    good one man, i might not be able to start something now cos of school but im picking up on the "get up and go now" which im lacking
    nice one

     
  • At 1:58 AM, Blogger The_Hustleman AKA James W. Dennis said…

    @ Mz Lonnie - Thanks for the faith in me, that means alot. It's something that I really never had much of. But you know most of that story...

    @ Dami - Peace! Just stay focused because when it's time you'll be ready. Nothing can stop a person on a mission plus you're in school so that shows right there you are thinking ahead and planning for the future. My hat's off to you; keep it moving always.

     

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