How an Entrepreneur Built a $5M Portfolio Using One Single Investing Technique with Kiana Danial: An EOFire Classic from 2022

0:02Who's ready to rock today, Fire Nation. JLD here and welcome to Entrepreneurs on Fire. brought to you by High Level, the all-in-one sales and marketing platform. On today's classic episode, we'll be breaking down how an entrepreneur built a$5 million portfolio using one single investing technique. To drop these value bombs, I brought to Kiana and to EO Fire Studios. Kiana is an award-winning, internationally recognized personal investing and wealth management expert. She is a highly sought-after commentator, professional speaker, and executive coach who has reported on the financial markets directly from the floor of NYSE and NASDAQ.

0:36and Fire Nation. We are talking today about becoming successful isn't about doing just one single thing. And if you don't aspire to become a millionaire in the next five years, you will be pushed into poverty and believing that you can and that you will be able to. Knowing how to do it is less important than believing and oh so much more. And a big thank you for sponsoring today's episode goes to Kiana and our sponsors. Franocity has helped hundreds of people leave unfulfilling jobs, invest in recession-resilient businesses, and creates legacy income for their families through franchising. Get started today with Franocity's franchise funding guide, packed with real-world strategies to launch your business without draining your savings.

1:15Visit Franocity.com. That's F-R-A-N-O-C-I-T-Y.com. Are you ready for the ultimate all-in-one platform for entrepreneurs, marketers, coaches, and agencies? Build funnels, automate follow-ups, manage clients, and even white label your own software, say hello to our featured partner, High Level, and visit highlevelfire.com to start your free trial today. Kiana, say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with. Becoming successful is not doing just one thing. There are a lot of gurus out there who would tell you, just do this one thing and you'll become successful.

2:05But unfortunately, that is not the truth. You have to have at least five things that I hope I can cover in this episode. Well, that's interesting because the topic of this episode is how you built a$5 million portfolio using one single investing technique. So I'm looking forward to seeing how that expands from just that one single investing technique. And let's just start with the question. can we really go from zero to a million just by investing? I mean, it kind of sounds like some amazing fairy tale. So it depends how you define investing, because yes, investing is the way to go, but it's not investing just in stocks or just in cryptocurrency or just in yourself or just in your company is a combination of all plus influence.

2:58So the one thing that I talk about that helped me go from zero to$5 million after I got fired from my Wall Street job is a wealth ecosystem. And within it, there are actually five components. Well, I do want to get to those five components, but I do want to first talk about the three steps. And in fact, what you believe are the first three steps that we need to take to get on the right track to create this amazing wealth. Absolutely. So the first step you need to take, regardless of your career, whether you're an entrepreneur, you have a nine to five job, you're a mom, you're a stay at home mom, a parent, or even a teenager.

3:45The first step that you need to take to get started is to become financially literate and take control of your own personal finances. So unfortunately, many people believe that they shouldn't really go in the financial planning route if they are not making millions of dollars. Most people think that financial literacy is a side effect of wealth, whereas wealth is a side effect of financial literacy. So you're going to take us through the three steps right now, Kiana. We just talked about becoming financially literate. We talked about taking control of our finances, Fire Nation, because guess what?

4:29Nobody's going to care about your finances as much as you. So just get over that there's some savior going to come and wave a magic wand and all of a sudden that you are going to be all taken care of financially. This is on you. So what is step two, Kiana? I meant to that, to what you just said, because if you can't manage a hundred bucks, you can't manage a hundred thousand dollars. You can't manage a million dollars. So step number one was becoming financial literate. Step number two is investing in yourself to create expertise or income producing expertise. And step number three is to compound.

5:07So invest in yourself, increase your income and invest that income. Those are the three steps. Let's talk about compounding. This is something that I do love when I read quotes like compound interest is the eighth wonder of the world. He or she who understands it earns it. He or she who doesn't pays it. I mean, to me, that's just a fantastic quote on compounding, but a lot of people have heard that word and maybe get it, you know, on some periphery level. What is compounding? Talk to us about it in your words, in your definition. Maybe give us an example of where it's so powerful. So there is this very interesting book that is taught in Japanese elementary schools.

5:50It is called One Grain of Rice that explains compounding to second graders. So this basically goes on to tell the story of Ronnie, a clever girl who outsmart a very selfish raja and she goes on and asks for one multiplied one grain of rice the first day two grains the next day and three gains the next day for 30 days so that is the only thing that she asked the raja and the raja thinks she's just stupid for asking this as a reward for something nice that she did for the Raja. But what happens is that the first day she gets one grain of rice, the next day, two grains, the next day, four grains.

6:41But the ninth day, she received 511 grains of rice, which again, still doesn't look like much, right? But that number kept doubling. So she asked for the Raja to double the number of rice, grains of rice that he gives her. And the number kept doubling until day 29th, which when she received over 536 million grains of rice. And on the 30th day, she doubled that. And that got more than 1 billion grains of rice, which basically got the Raja bankrupt. A single decision to begin compounding, which is exactly what this clever girl did, resulted in more than 1 billion grains of rice, which is the aftermath of compounding.

7:39Fire Nation, I hope you do realize why a lot of people say that it's the eighth wonder of the world. I mean, you talk to people like Warren Buffett, Charlie Munger. They say, listen, the reason why I have so much money is because I've been at this for so long and my money's been making money. And that money that I've made making money is now making money on the money. And it's just this compounding effect that allows people who have been in the game the longest to have exponential rewards when they are investing financially correctly and intelligently, etc. And we're gonna be talking about a lot of important things for you, Fire Nation, as soon as we get back from thanking our sponsors.

8:17Have you ever dreamed of hopping around with kangaroos in Australia or bungee jumping over 400 feet into a canyon in New Zealand? I have and I did. Oh, Oh, and I also cuddled up with a koala, true story. That's right. Kate and I toured Australia and New Zealand with some good friends of ours who knew these places well. And we think that's the best way to travel as if you're a local. This also includes staying in actual homes, which we always do on our travels, thanks to Airbnb. It's a perfect way to truly immerse yourself in a new place. And what better time to not only enjoy someone else's home, but to also have others enjoy yours.

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11:26So visit highlevelfire.com to start your free trial and see why thousands of businesses are switching. That's highlevelfire.com, where marketing, sales, and automation finally come together. High level, join the revolution. Now, Kiana, competition is everywhere, especially when it comes to investing. How can we stay ahead of the competition? So this is an interesting question because competition is the only person I compete with is myself. I actually don't think there is any competition because I come from an abundant mindset, especially in investing. So here's the thing. If you're competing in the stock market or in the cryptocurrency market, you're only going to have real competition if you are day trading, if you're trying to beat the markets on a daily basis and speculate and get emotional and have buyers and sellers in the long run.

12:31However, if you start value investing, which is what Warren Buffett does, which means investing in companies that improve life, that are category kings, that help you do things better, faster and cheaper. not only investing in these companies are going to create competition by investing in those and encouraging others to invest in those companies the stock the shares the price of those shares of those companies are going to go higher which means you are going to make more money so in terms of investing i don't believe there is any competition but yourself which means acquiring those skills to learn how to select the best value assets that suit your unique risk tolerance and your financial goals.

13:24There is competition in the marketplace if you have your own business. But again, I would argue that the competition could be completely banished if you pick a niche. So as we talked about before, the three steps that I took to go from zero to$5 million was first investing in myself. What does that even mean? Investing in myself was to increase my expertise, increase income creating cash flow. I know that right now I'm talking about both investing and having your own business at the same time. And that's because they are both required when you are building wealth. We talked about compounding and we, you mentioned that time is the most important ingredient when it comes to compounding, right?

14:16However, we all know that time is limited in inventory. And what's interesting is that people who are not on the compounding route yet, they will spend a lot of time to save a lot of money, or a little bit of money, for that matter. and because time is limited inventory investing alone is not going to help you become or achieve financial freedom fast let me give you an example on that and we'll go back to competition in just a little bit so how compounding works is that you put your money let's say in an asset like a stock of a company or in a cryptocurrency or in any other person's company. And you basically wait for that asset to increase in value.

15:18And then you sell it. So you buy at a lower price and you sell it at a higher price and boom, you make money. And now you can go back in in a different asset or the same asset at a lower price again and build on top of that. So using using this method of investing and contributing to my portfolio$500 per month. Back when I first got started, I went from$500 to$50 ,000 in three years just by compounding on my investing, which is a great return. But you can agree that this is not a million dollar in but status, right? now I was thinking how can I accelerate this compounding so that I'm not bound to time because I don't want to become a millionaire like when I'm 90 I want to become a millionaire when I still can enjoy that money so how can we do that and I just thought okay let's get crazy at this rate of compounding, what if I had put$500 ,000 per month in my investment account instead of just$500 per month?

16:36At that rate of return, that investment would have turned into $50 million in those three years. Isn't that crazy? So how can we do that? How can we compound at a speedier manner. And the answer to that is increasing your income. So that's what I meant by investing in the financial markets alone is not going to, it is helpful, it's better than not investing at all. Because if you invest 500 bucks per month for 20 years, you are going to achieve a million dollar status, even at the average market return. But if you wanna speed it up, it is to your benefit to also increase your income now the other side is also true there are a lot of entrepreneurs who make a lot of money i know a lot of entrepreneurs who make a million dollars per year but they have nothing to show for it in fact some of them are broke why because they are not financially literate because they are not putting the money into work They are both incredibly important.

17:45So as when I learned about this and I learned that there are things that I can do now online to increase my income and there has never been a better time to learn these methods. So I went ahead. I invested in myself. I learned skills to increase my income online. And then I invested that money. And boom. I first achieved my first million dollars in 2020. and then I went from 1 million to 7 million in 2022. And the result was thanks to having all the components of this wealth ecosystem, not just one. Now, this is an interesting statement that you made that I really do want to explore on this topic.

18:27You believe that it's important to become a millionaire in the next five years. What do you mean by that? It is very important that you realize that the modern millionaire is basically the same as a middle class or a manager in the 70s. Because inflation is going up at an accelerated rate, we just found out that inflation is up 7%. That is the highest in the past four decades. If you don't aspire to become a millionaire in the next five years, you are going to be pushed into poverty. So we have to actually rewire our brain about the definition of a millionaire. A millionaire is very different than a billionaire with a B.

19:20A billion is a thousand million. whereas a millionaire if you have one million dollars in your assets a one million dollar net worth and by the way there are four types of millionaires we can talk about that that only means that you can do the things that you want you can have a fairly comfortable lifestyle and

19:47you may be able to leave a generous legacy after you pass. So you need to aspire to become the right kind of a millionaire, which is very different than an imaginary millionaire. An imaginary millionaire is somebody who makes a million dollars but doesn't keep any of it. A real millionaire is somebody who has assets that after taking away the liabilities at equals a million dollars. A real millionaire is somebody who has an investment portfolio at or above a million dollars. A real millionaire is somebody who has a trust fund that is at or above a million dollars. and that equals financial freedom so that you don't have to worry about inflation for the years to come.

20:40And I will say 100 % of the time when people look at me and say, hey, John, I made a million dollars last year. I'm like, that's impressive because it really is impressive to make a million dollars. But my follow-up question is always wanting to be, how much money do you have in your bank right now? Like how much money do you have in your bank? You made a million dollars last year. How much money do you have in your bank account right now? And I think that's really important to think about, Fire Nation, because it's not always about what you make, but what do you keep? What can you invest? What can you allow to compound as you're going forward?

21:14Now, after wealth creation, Kiana, we need to think about wealth preservation. How would you preserve your wealth after hitting your first million dollars plus? Absolutely great question. So that is, I would have to quote Rockefeller here, you want to own nothing and control everything. Because after you hit a million dollars, it is time for you to take a little bit of time to preserve that money so that if you get sued, if something happens, if your company goes bankrupt, if anything, if the markets crash, you are not going to personally get hit by that. And this is something that, again, even some CPAs don't talk about, and that is having a trust fund system that also helps you with being taxed.

22:03And it is exactly what the Elon Musks and Jeff Bezos of the world do to avoid paying taxes and to preserve their wealth. There is a system called non-statutory common law business trust that is recommended for people, for anybody who has a net worth above a million dollars so that they can preserve their wealth and not pay more tax than necessary. What would you say, in addition to what you've already shared, about wealth preservation? I mean, what exactly do people who hit significant wealth numbers need to do above and beyond what you just shared? Well, it is a simple fact of investing it and compounding it and not adjusting their lifestyle to exceed the amount that they're bringing in.

23:01So one of the biggest mistakes that any person who comes to New Money makes is they go buy a yacht or they go start traveling on private jets or they change their lifestyle that when you look at the margin from the money that we're making before and their lifestyle that they were using before they were living before the margin is the same so they are still not protecting or preserving the wealth they're bringing in so that is why it is super important to always be on top of your net worth, like becoming an asset millionaire and then compounding the money and not changing your lifestyle dramatically.

23:44I'm not telling you, okay, continue being cheap or continue looking at price tags. You can make moderate changes, but not to the point that will bring your net worth lower. And the second most important thing is to clearly compound it, invest it and diversify your investments that all of your eggs are not in one basket i learned this from my dad so my dad um before so i'm born and raised in iran uh to a jewish family and before the iranian revolution of 1979 my dad was actually a very successful business owner he had a company that um incorporated that employed over 2 000 people and before i was born my family was living a very good life.

24:31Then the revolution happened. And my dad never thought to diversify his assets or protect his assets because he never thought that anything could ever go wrong in this country, which was Iran. At the time we were under the Shah. And then what happened in 1979, the revolution happened. The old government was out and the new government came in and started cracking down on all the wealthy people. So what happened is that they froze his bank account. They came to our house and got all of his assets, all of his machinery, and he didn't have any sort of diversification. So he went to zero, below zero, actually.

25:09They were actually going to kill him, but he survived. So that has become my obsession with diversification, because no matter how much you trust your government, no matter how much you think things are too big to fail, there is always history is going to repeat itself. And the best thing you can do for yourself is to diversify internationally among different types of investments, among different types of businesses, different types of categories, so that if something happens to one of the categories, you always have a route to escape. Kiana, you've given us a ton of value through this entire episode.

25:52You've given us the components to becoming financially literate, wealth preservation, so much more. What is the point you want to make sure we really get from our entire conversation? What is the one thing you want to make sure our listeners walk away with? And then we'll say goodbye. The most important component that I would love your listeners to hang on to is that if you believe you can or if you believe you can't, you are right. This is a quote by Henry Ford. And if you believe you can become an asset millionaire, a portfolio millionaire, then you are going to be able to become it. Knowing how to do it is less important than believing how you do it.

26:37And the people who succeed make decisions differently than people who struggle. And that's because the billionaires of high achievers think differently. So it goes bank to mindset. And I know it's cliche, but it's so true. So believe that you can, if I can do it, you can do it. And let's go. Do you have any call to action for our listeners of where they can learn more about you, connect with you and your business? Absolutely. You can go to learn.investdiva.com. Take my free masterclass where I teach you how to take control of your financial future. Even if you have never invested before, if you're just getting started, if you want to diversify, Whether you're a business owner, a parent, or a nine-to-fiver, I share basically my whole process for wealth preservation and compounding in this free masterclass.

27:28One more time, give us that URL. Learn, L-E-A-R-N dot invest diva, I-N-V-E-S-T, D as a Daniel, I-V as a Victor, A dot com. Fire Nation, you're the average. Of the five people you spend the most time with, you've been hanging out with KD and JLD today, so keep up that heat. Head over to eofire.com, type Kiana, K-I-A-N-A, into the search bar. Her show notes page will pop up with everything that we talked about here today. Links to everything. Learn.investdiva.com is your direct call to action. Kiana, thank you for sharing your truth, your knowledge, your value with Fire Nation today. For that, we salute you and we'll catch you on the flip side.

28:14Thank you so much for having me. Hey, Fire Nation. Today's value bomb content was brought to you by Kiana. And Fire Nation's successful entrepreneurs accomplish big goals. That's why I created the Freedom Journal to guide you in accomplishing your number one goal in 100 days, step by step. Visit thefreedomjournal.com and I'll catch you there or I'll catch you on the flip side. Franocity has helped hundreds of people leave unfulfilling jobs, invest in recession-resilient businesses, and create legacy income for their families through franchising. Get started today with Franocity's Franchise Funding Guide, packed with real-world strategies to launch your business without draining your savings.

28:55Visit Franocity.com. That's F-R-A-N-O-C-I-T-Y dot com. Are you ready for the ultimate all-in-one platform for entrepreneurs, marketers, coaches, and agencies? Build funnels, automate follow-ups, manage clients, and even white label your own software. Say hello to our featured partner, High Level, and visit highlevelfire.com to start your free trial today.