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Scenario: "Well to really market our product to reach mass appeal, we just need to make the product better. That is, focus on our product's features and capabilities. The more money we put into it, the more features we'll have, the better our products. When we build it, they will come." With all due respect: Blah. Blah. Blah. Great products that reach mass appeal have barely anything to do with a product's features. Yet, you look out to the "super-awesome" business world, and you see the inevitable: more money placed into R&D, commercials highlighting more product features. And filmmakers spending millions on their movies to product the oh-so-cool-special-effects "that will attract millions alone."

It's a blah world out there with 0.0001% smart marketers.

We said earlier people don't buy product features; they buy on emotions. But, of course like all things, it's not that simple. You can sell "dreams" all you want; but, the masses won't buy from you unless they find others using your stuff. For instance, you can sell "status" all you want if you're a Mercedes salesperson; but if no one has bought a Mercedes in the last decade, you won't attract a sale.

What makes the masses buy?

To understand their purchasing decisions then, know this: The masses people use the the "who-else-is-buying" approach to influence their buying. That is, the more people that buy your product, the more people that want your product (i.e. Apple's iPod). And vice-versa (i.e. Dell's JukeBox).

It's in the study.

Columbia University's Matthew Salganik, Peter Sheridan Dodds, and Duncan J. Watts conducted this kick-ass study that showed the social network indisputably influenced purchasing decisions:

Who?

More than 14,000 participants were recruited through the teen networking site Bolt, and the impact of social influence on their choice of songs to download was tested.

What?

After seeing a selection of 48 digital songs by unknown bands displayed on a Web page, participants were asked to choose songs to listen to and then allowed to download the ones they liked.

How?

As they arrived at the site, they were randomly allocated to one of two experimental conditions: "independent," in which they saw only the names of the bands and songs; or "social influence," in which they were further divided into eight distinct "worlds," and could see, in addition to the bands and songs, how many times each song had been downloaded by previous participants in their respective worlds. There were three main findings:
  1. Finding One

    First, social influence increased the inequality of outcomes in all eight worlds, meaning that popular songs were more popular and unpopular songs were less popular than when participants made decisions independently.
  2. Finding Two

    Second, however, which particular songs would turn out to be successful in any given world was more difficult to predict.
  3. Finding Three

    And third, both inequality and unpredictability increased as the strength of social influence was experimentally increased. Overall, the "best" songs rarely did very poorly, and the "worst" songs rarely did very well, but any other outcome was possible.

"What do I do then?"

Our three biggest recommendations for you:

  1. Stop wasting a chunk of your investment dollars on "product features."

    Putting more money into R&D won't buy you the masses. A crazy number of companies are putting their dollars creating crazy features that won't cause a dent in the market. Don't be them. Know that the social network influences the masses. Then, budget your investment dollars keeping that concept in mind.
  2. Tap the influential social network superstars.

    Big-time bloggers, Hollywood celebrities, All-world athletes. They're ridiculously influential people who get a ridiculously number of people to buy what they recommend. Nike became huge because of Michael Jordan. The Sidekick went big because of teen celebrities. And nerds around the world knew about Web 2.0 players because of TechCrunch.
  3. Build small. Grow from there.

    And folks, here's the secret sauce: products don't become instant hits overnight. Instead, it takes time, dedication, and persistence. Most importantly, it takes patience to know overnight hits won't happen. To reach the masses, first go through the few influential superstars who have a ridiculous following (See Point ^2 above). Only then can you gradually build your customer base that leads to mass appeal.

The badass thesis:

Attract the few highly ridiculous influential to reach the 3,041,392,654,528,514,532.

Posted on August 28

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Scenario: Dude, we're on a mission to be the smartest people in the world. We have to stop playing basketball for the rest of our lives. We can't run any more 5K invitationals, play football on Sundays, or bike 50-mile trails. We can't do anything else but read and study. Period. Conventional wisdom thinks so. Stereotypical nerds and jocks are worlds apart, aren't they?

Those smart nerds do something shocking.

When you study the smartest people in the world: the Nobel Prize winners, the Pulitzers', the Fields Medals', the Rhodes Scholars, and any other nerdy contest, you'll see that most make physical activity one of their top priorities. Why?

It's 'cuz exercising makes you smarter.

Exercising helps build your brain cells, making you one smart bitch. Says Psyched for Success's Layla Merritt:

Physical activity is as much a workout for your brain as for your body. Exercise actually stimulates growth in brain cells. Schoolchildren who exercise three or four times a week get higher than average exam scores. Senior citizens who walk regularly perform better on memory tests than their sedentary peers. In fact, as they age, walkers show far less cognitive decline than that of non-walkers.

And that's backed by University of San Francisco's Christin Anderson MS, who says that when you exercise, "you can think more clearly, perform better, and your morale is better. This is pure science -- stimulate your nervous system and function at a higher level."

A side benefit of exercise?

It makes you happier. Says Harvard's John Ratley MD, exercise "affects mood, vitality, alertness, and feelings of well-being." So when you're just lounging around this weekend, remind your bad-self:

"When I exercise, I become smarter. And, happier."

 

Posted on August 27

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Scenario: You've been up all night trying to memorize your sales presentation. You walk into the presentation, with zero sleep, and then it hits: your brain goes blah. You're able to explain certain parts, but you forget the most important points in your presentation. What should you have done? Sleep!

When you sleep, you improve your memory.

Psychology Professor Howard Nusbaum studied the effects on how students retained information. Using hard-to-decipher words, he tested how much info students retained using two scenarios:

[Students] were tested first at 9 in the morning and then tested again at 9 that night. This group remembered only remembered 31 percent of the words in the test at the end of the day. Yet after a night of sleep, their scores climbed up again: the following morning, the same students remembered 40 percent of the words.

Have that sales presentation soon?

Get some great sleep to have a kick-ass memory.

Posted on August 26

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Says super Micro-Manager Billy on his usual power-trip: "I'm watching you, sucka."

Conventional wisdom says...

You get amazing productivity and results from your workers if you monitor them constantly. Yet, like usual:

Conventional wisdom is wrong.

Managers with Billy's aggressive managerial style demotivate their workers from producing kick-ass results. Instead of empowering workers, they dispirit the heck out of them. It's as if they're treating their workers as working drones, who fulfil robotic orders to satisfy the only one who uses his/her brain: the manager. Don't follow their paths. Monitoring your workers hurts your company in three ways:

  1. You break your their trust.

    People inherently want work. They crave and seek responsibility, and will do whatever it takes to achieve objectives they believe in. When you place roadblocks by monitoring your workers, you break their trust. Instead of empowering them (i.e. "I believe you will kick-ass. Go do it."), you're telling them you don't trust them (i.e. "Unless I will monitor you, you won't get work done."). A working relationship that lacks trust leads to apathetic results.
  2. You drain their productivity.

    Ever worked for an over-demanding boss? It drains your emotional (and physical) energy trying to fulfill his/her every need. The journal Computers in Human Behavior concluded that the effects of monitoring workers hurts their productivity:
    "Researchers gave 134 subjects the standard corporate spiel: quantity and quality are of equal importance. But while each subject carried out data-correction tasks, electronic prompts suggested they were being monitored for quality, quantity, both or neither. As one might suspect, productivity diminished when people believed they were being monitored for quality and vice versa."
  3. You obstruct their creativity.

    Instead of kicking-ass, they're trying to satisfy you. They're doing "just enough" to make you happy -- not more. A relationship that lacks trust, that lacks empowerment, that lacks "I believe you will kick-ass even if I'm not there" quotes, results in mediocre results that "just gets by." It's a reason why you see so many boring products, applications, and services that lack any passion, whatsoever. Instead, we're used to the blah-ness of most things with workers who can't tap their inner motivations.

"Then, what in the world do I do?"

Instead of monitoring your workers, empower them. Believe that they will kick-ass. Give them a clear destination. Then, get the heck out of the way. If you have the right people on your bus, they'll surprise you with what they can do. The thesis:

Empower your workers like the bad-ass mother %@^%!@*& that they are.


And they really are. Word.

Posted on August 25

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Says computer salesman Johnny: "Hey dawg. I got this pimped out server with all the fixings. 7500GB storage capacity. 3.0 Gbps of bandwidth. 15 SAS and/or SATA II drives. And it has the sleek SAS disk drives. You suck. You need the latest! Buy it, now! Now!"

Bull-loney.

For your next tech product purchase, remember the following:

Technology changes rapidly. Your business needs stay constant.

The difference:

  • The last two years brought the business world advances in web technology: including Ruby on Rails, AJAX, stronger open source apps, and a plethora of other tech goodies.

  • Yet, as business-builders, our needs barely changed: fattening our profits, providing kick-ass customer service, building innovative solutions, and creating the craziest mother $^@%^& company in the world.

Knowing this keeps you in check to purchase only what your kick-ass business needs. So, when you're out buying a tech product:

Focus on Business Needs. F^@! Tech Buzz Words.

Forget the super-duper technologically advanced products that those salespeople hype. Instead, understand precisely how a tech product can serve your company. Three reasons:

  1. Tech features won't build your company.

    The wisest companies see how technology will make them more agile, market quicker, reduce sales cycles, and a solve a variety of other sweet problems.
  2. Know the "latest tech features" this month won't be so hot next month.

    Grabbing today's latest and greatest features of the so called "technology/web 2.0 era" won't build any sustainable advantage. Before you know it, the tech world will introduce newer and faster features after a few weeks.
  3. Understand typical technology investments suck.

    Negative Return on Investments (ROIs) serve as the hallmark of most tech projects. The reason? Most tech products have a (1) tech person, a (2) business person -- and no one in between to connect the two. A lack of communication occurs between Mr. VP and Mr. IT:
    • Mr. IT: "Dude, you'll need all these features. It's rockin' Web 2.0! WEB 2.0! If you don't have it, your company will die. A crazy death."
    • Mr. VP: "Wow! Okay! Buy, buy!"
    • Mr. IT: "Everybody dance now!"

Just say NO! to Tech-Crazed Companies (w/ No Business Solutions)

Do something radical among the business world:

  • Look for tech companies who provide solutions to your problems.

    You don't go to the doctor because he uses the latest Type Vll gauze pads. You don't go to a lawyer because he has a Barrister Bookcase. You shouldn't go to some nerdy technology company because it uses all the latest technical jargon. Instead, you go to a technology provider because you need solutions. If they can't and won't provide solutions to your problems, you'll run far away. They'll likely -- probably -- burn your investment. And worse: weaken your company's short- and long-term growth.

If there's one thing to take away from this article, it's this:

Technology can never create your company's success. It can only complement whatever kick-ass business operation you're running. Yet, most tech firms hype their product as if it's some magic pill. It's not. No tech product ever is. When you see some tech salespeople hawking their product features, tell 'em:

"Hey basement-dwelling, Cheetos-eating nerds: I need business solutions -- not your technical buzzwords. Word!"

Posted on August 24

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Scenario: "I'm the boss at my big company. Everything runs through me. I run this place with an iron fist: I hire and fire all employees, and I make them do what whatever I want. People say micro-managing doesn't work, but it certainly does for my company. My employees are scared $hitless."

What if micro-managers ran the United States, or any other first-world country?

That is, if everything went through the president/prime-minister or his assistants? And:

  • If the executive panel dictated whether you could buy a house, a car, a boat, or Keven Federline's new CD?
  • If those bastards told you where you could travel during your summer months?
  • If they dictated specifically what business you can and cannot start?
  • If they told you where you can live, who you can date, what music you can have in your iPod?
  • And: If you wanted to rock the world now, but you couldn't because you're not old enough -- and those executive bastards only promoted those who they knew?

Most First-World Companies Suck...

Most business executives, in capitalistic markets and democratic nations, run their companies like dictatorships. Instead of empowering their workers, they're dictating what employees can and cannot do -- all with an iron fist. It's a reason why most executives underdevelop their companies. Instead of running a dictatorship, do what most business executives fear: democratize your company. Empower your workers. They'll surprise you with what they can do.

Why Democratizing Your Company Rocks

When you focus on democratizing:

  1. You open communication.

    Imagine living in a country where you'll see prison time if you disagree with Mr./Ms. President. That's akin to how most companies run their stuff: as soon as employees criticize their companies, they're fired. What does that tell the rest of your employees? "Shut up. Do your work. I don't care what you think." It's a great de-motivator for your employees when your company doesn't seek win/win situations. Instead, when your company encourages open conflicts, you open discussion. Like business guru Jim Collins says, you can't make good decisions without understanding the brutal facts of your company.
  2. You optimize people's talents.

    Magazines praise entrepreneurs for doing what they love, and where they excel. In turn, entrepreneurs who seek and discover where they employees excel, and what they love doing, become the greatest managers. Inherently, we all have a Michael Jordan inside each and every one of us. And, if given the right conditions, we'll work our butts off for you whether you're watching us or not. The key then is to create an environment where your company can capitalize on that sumptuous talent. Instead of restricting what your employees can do, free your company's social structure. If 19-year old Billy Bob majored in Classics, but loves and can excel in marketing, let him shine. Oh, let him shine! An open environment gets everybody aligned to use their best talents for your badass company.
  3. You discover the best and brightest.

    A culture where merit trumps over seniority rocks. You build an environment that breeds results-oriented people, and kicks out those who don't produce. You keep people on their toes producing like a mutha flucka, and reminding 'em: "Seniority doesn't matter. Results do." It's like you're running any professional sports team that gets the best talent on the front lines: "You're 18-years old. But if you're better than the 38-year old dude, you'll play."

What The Badass Prof Says...

When you model your company's structure after a democratic structure, USC's Leadership Guru Warren Bennis, says you incorporate:

  1. Full and free communication, regardless of rank and power.
  2. A reliance on consensus rather than on coercion or compromise to manage conflict.
  3. The idea that influence is based on technical competence and knowledge rather than on the vagaries of personal whims or prerogatives of power.
  4. An atmosphere that permits and even encourages emotional expression as well as task-oriented behavior.
  5. A basically human bias, one that accepts the inevitability of conflict between the organization and the individual but is willing to cope with and mediate this conflict on rational grounds.

"So how do I democratize my company?"

Take the "free world" structure as your model:

  1. You promote merit over seniority, connections, and what someone did ten years ago.

    If a college student is more capable than some veteran marketing manager, your business's structure will promote that college student over the veteran dude. Most companies promote people based on seniority, which is a crap business method. Seniority doesn't improve your organization. People who produce results do, and should be promoted.
  2. You promote open communication: discussion, conflict, and disagreements.

    Some 16-year old hot shot employee should be able to freely air criticisms of the CEO's decisions, without fear of being fired. Here's a start to ask your employees: "Name 5 reasons why we suck." (And if you'd rather be less direct, go with the: "Name 5 reasons we can improve.")
  3. You empower each and every employee.

    Like entrepreneurs around the world, employees are craving to have an impact in your organization. If you empower them to do what's in the best interest of your company, you'll get some pretty amazing, cool, and sweet results. It's a reason why Google promotes 20% time for all their employees, which result in 50% of their innovations. Empowerment rocks. It's also a reason why Wall Street gems such as 3M and Wells Fargo, among the several others, do it too.

The thesis:

Get badass results by democratizing the mutha flucka out of your company.

Posted on August 23

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Now, you're thinking: "Yes, but that's illegal."

But folks, we mean something totally different, and perfectly legal. It's old school way of: Negotiating like a bad ass.

"But I'm not making money negotiating, am I?"

Sure, you won't really "make money." But, you'll save. And as the great financial gurus like to tell us, "saving" equals "earning." Whether it's your hotel stays, your car rentals, your airfare, your clothes, a programming job, consulting services, or Kevin Federline's new Vanilla Ice album on compact disc, you can negotiate practically anything this world and its mama sells you. Says Sarah McBride of the Wall Street Journal:

"Most people don't think twice about bargaining when it comes to something big, like a new car or home. But getting a price cut on smaller things, cable bills, doctors' fees, electronics goods, can be surprisingly easy: Just ask."

So when you're out buying new shoes (it doesn't matter the store), ask for a discount -- or a free pair of socks. Chances are good you'll get something.

Why does negotiating usually work?

One, but certainly not conclusive, list:

  • Manager Sally wants to rid excess inventory from her shop.
    So she'll perfectly welcome you with open arms for a fair price.

  • Seller Chrissy has "employee, friends, & family" discounts.
    So she has all the power to grant you something if you ask her. Nicely.

  • Salesperson Bobby has a quota he needs to meet.
    So he'll oblige quickly -- if your offer's reasonable.

  • The store owner just wants to be hella cool, and hella nice.
    People love making their customers happy, provided that they like those customers.

"So how do I really negotiate?"

Beyond just asking for a discount you have in mind, here's the bad-ass way to negotiating:

  1. Pick your desired discount. (e.g. 25% off for the coffee table)

  2. Go up to your salesperson, and ask for a discount beyond your desired number. (e.g. 35% off)

  3. If accepted, great. If not, retreat to your desired value. (25%)

  4. Likely, you'll get your discount -- if it's reasonable, of course.

Why does that method work?

We all have this "You-gave-me-something so-I-have-to-give-something-to-you" mindset. It's the philosophy behind the popular "I-owe-you-big-time" phrase. Psychologist Robert Cialdini calls this the reciprocity principle: If John gives us a toy, we feel obligated to return that gift by giving him an equal-or-greater-priced toy. So when you're quoting a higher discount (e.g. 35%), then retreat to your desired value (i.e. 25%) -- you're sending a signal to the salesperson that you're "giving" the her a "gift" by retreating to a better offer for her. So, she feels obligated to return that "gift" by accepting your 25% discount.

One important disclaimer: Be ethical about it.

If don't seek win/win deals consistently, that mindset will kill your business in the long-run. To paraphrase Spiderman (yes, we're quoting that kick-ass mutha flucka): "With power comes responsibility." If we discovered a supplier manipulated us for its win/lose situation, we'd drop the supplier immediately. They'll without-a-doubt do the same to us. Business deals not built on mutually beneficial relationships kill any long-term future you might have with your supplier -- as well as breaking the all-important social network between the two of you. Moral: Just do the right thing. Adopt the win/win mindset before you negotiate anything. Now as the biggest cheerleader in your corner (and we mean it!), please go out there and:

Negotiate like the bad-ass that you are.

Posted on August 22

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Scenario: "Billy, I got an epiphany last night. The secret way to winning customer orders: Kiss their asses." Blah:

  1. Kissing customer asses won't win you customers because -- among other reasons -- they'll see right through you.
  2. There's a much simpler, and ethical, way to win new customer contracts.

What is it?

Just make your buying process ridiculously easier.

Most companies set up their sales cycle in some sorta twisted-please-run-away-vibe fashion:

  • The gem: "We have tons products on sale. But, you don't really know about it because we have no product brochures offline, or online. To know about our next-generation products, please ask us. Then if we can get our butts in gear, maybe we'll create an ordering form for you."
  • Or the classic: "You need to fill out Document A, B, C, J, P, Z, highlighting the number of widgets you want. Then, fax them to us. Wait five days. Then, we'll see if we have the quantities available to fill your orders. Then, we'll send you a fax the following Tuesday. Then...then....then.......yadda, yadda, yadda."

People usually drop orders from companies with mega-stupid ordering processes. Why?

  1. It takes too long.

    Customer: "Uh-oh. You mean I have to work my butt off to purchase a product from you?" You: "Yes. But we'll do a lot of work too."
  2. It drains productivity.

    Customer: "I have to fill out ten purchase forms, wait for your responses, then call you repeatedly? We'd rather build our businesses than going through exhausting purchase forms." You: "We'll have to fulfill orders, return phone calls, and ensure smooth transactions, constantly. Yes, we'd too rather build our business than repeatedly doing something that drains us from building our rock star business."
  3. It kills repeat-purchases.

    Customer: "I'd love to buy from you again. But, your competitor's ordering process is so much easier." You: "Why are we getting so many 'one-and-done' orders? Aren't repeat purchases 80% easier than new purchases?"

When your order processes are out of whack, watch your bottom line shrink faster than Nicole Richie's waistline.

What do you do?

Simply, and repeatedly, shorten these two points:

  • Point A: Widget in warehouse.
  • Point B: Widget on customer's desk.

The longer the line, the more profits you'll lose. So, start shrinking that mutha flucka line connecting A-B in half each month. That's it.

Follow the Fortune 500s

A number of Fortune 500s have built a great chunk of their profits by simply quickening the ordering process. Whether it's getting a pizza delivered without traffic headaches, or buying a computer from the luxury of your room, simplifying people's lives -- we think, anyway -- lies as one of the best ways to win new, repeat, and referral customer contracts. Some examples of how the bigger guys are making it easier to purchase from them:

  • Ex. A: Domino's Pizza and the Pizza Industry

    Before: Hop in car. Brave through traffic. Order pizza. Wait 1 hour. Eat. Drive home through traffic. Arrive home. After: Pizza in 30 minutes. If your order doesn't get to your house in half-an-hour, it's free. That's how Domino's initially built their businesses. The resulting model trickled over to other pizza joints, making the pizza a quick, household tradition.
  • Ex. B: Apple's iPod and iTunes

    Before: Hop in car. Find CDs during business hours. Wait in line. Buy. Brave home. Now: Log onto your computer 24-hours a day. Get any song you want. Apple made it easier for music enthusiasts to purchase songs-on-the-go-any-time-any-day. Don't have time to buy new songs to put in your CD player for tomorrow's run? Just hop on iTunes, and get your music when you want them -- all within 5 minutes.
  • Ex. C: FedEx's Pickup Programs

    Before: Hop in car. Buy boxes. Go home. Wrap those boxes with items. Hope in car. Go to shipping depot. Fill out forms. Submit your orders. After: Fill out forms one time. FedEx travels to your door weekly to pick up and deliver your orders. The other cool benefit: it gives your boxes for next week's shipment.
  • Ex. D: Dell's Direct-to-Order Model

    Before: Hop in car. Buy computers from salesmen, with generic parts not really suited for your needs. Brave home. After: Log onto your computer 24/7. Fill out your preferences with a super useful guide. Submit order. Get your order within weeks.

Most of those "buy-my-books-because-I'm-a-super-biz-guru" people tell you that the big business model is crap. Sure embracing the "I-hate-big-business" mindset makes us seem rebellious -- but as small businesses, we all can learn tremendously from what those bigger guys do.

Make it easier for customers to purchase from you.

Improve your business's and customer's productivity. Then watch as you fatten both of your bottom lines, morale, productivity, and repeat-relationships. The focus:

Shorten your order process like a mutha flucka.

Posted on August 21

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Scenario: "Dude, those guys at Trizzy told me to relax this weekend, so I'm not doing anything. I have plans to do absolutely nothing. But dude, I find my weekends so depressing!" Relaxing over the weekend helps you rebuild the energy you'll need for the coming week. To be happy, then: have a sweet lookin' schedule for your weekend.

No plans. = Sucky weekend.

Most of us tell ourselves we'll rest. But what do we do? With an unplanned schedule, we continue checking emails, returning phone calls, writing documents -- and of course, add the qualifier: we do it "not so intensely."

Picture it!

If you're seeking a happy weekend, coupled with rebuilding your energy -- even if you feel you just gotta, hafta work this weekend -- sketch out your day's schedule.

Plan it!

Set a block of time when you'll work (or even better: tasks you'll accomplish). Then set another block for your chillin'-like-a-villain time -- whether that's hanging out with friends, playing sports, reading a book, or whatever else.

You'll see a dramatic boost in your morale.

Happy people know in advance what their days will look like. Says Oxford University psychologist Michael Argyle, happy people have their schedules "filled and planned." On the other hand: "For unhappy people, time is unfilled, open and uncommitted; they postpone things and are inefficient." So, the secret to being happy over the weekend:

Plan your mother-kick-assin' weekends!


Word.
Posted on August 20

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Scenario: "Bill Gates, Steve Jobs, Richard Branson, Sam Walton, Ray Kroc, Thomas Edison. They were all lucky." ...so says the dude who thinks people become rediculously rich because fate had it all planned. Yet, when you study each of those filty successful people, all experienced initial failures.

"Lucky" people aren't so lucky.

Bill Gates experienced it with Digital Research, Steve Jobs had it with his Apple Lisa, Sam Walton saw his initial variety stores shut down. Ray Kroc couldn't hold a job down, and Edison had 3432129532 (or something like that) experiments before he could make his glass bulb light.

All suceeded because they continuously fought a good fight.

The harder they fought, the "luckier" -- according to outsiders -- they got. Ray Kroc once said, "Luck is a dividend of sweat. The more you sweat, the luckier you get."

The harder you work, the more you discover kick-ass opportunities for yourself.


Posted on August 19

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