Level Four: The Entrepreneurial Investor
With a business that generates profits, the entrepreneur who has succeeded this far can begin to accept another exciting challenge, that of managing money so that it works to produce more money. Investing for maximum returns involves smart leverage of assets, and the entrepreneurial investor will often leverage the success of the first business to create a second or third company based on the same model or system.
By franchising the original venture or buying other healthy businesses, the investor can get into the career of not just selling basic products and services, but of selling entire businesses. The goal, of course, is still to turn a profit. So rather than remaining at the helm of these companies the investor will buy them, ensure that they have valuable equity or attractive allure and potential, and then sell them to other entrepreneurs or would-be entrepreneurs. The focus becomes finding, buying (and perhaps refurbishing) businesses, in the same way that a real estate investor locates homes, rehabs them, and then flips them for a profit.
The challenge is to avoid falling back into the role of running a business as an administrator or manager and to meet this problem with a viable solution the entrepreneur will typically appoint someone else to take the reins of the company as the president or CEO. Then the investor becomes more of a director or silent partner who shares in the profits while enjoying the relief of not having to share the routine responsibilities of running the business from the inside.
This all becomes possible because the entrepreneur has not just created a business but has also designed excellent systems for keeping it going. Rather than dealing on the level of isolated actions and reactionary tactics, in other words, the entrepreneurial investor has risen to the level of broad and comprehensive strategies that work across all sorts of products, services, and economic cycles. Working smart replaces working hard, and the rewards – both financial and personal – are abundant.
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