MBA2695 Why You’re Still Poor & How to Get Rich

0:00If you've been working hard for years, but still feel broke, there's a reason. And no, it's not because you're unlucky or you're just not cut out for business. It's because you're stuck in a trap, a trap of trading time for money. That's the number one reason most people stay poor. They work an hour, they get paid an hour. When you stop working, the money stops coming in as well. And that is the ultimate financial dead end. If you want to get rich, you have to escape this trap. The way out is something called leverage.

0:39Welcome back to the$100 MBA show. I'm your host Omar Zinhome, where I deliver practical business lessons three times a week, Monday, Wednesday and Friday, to help you start grow and scale your business. Real quick, if these episodes help you in any way, hit the follow button on this podcast app. It helps us to keep bringing you practical business insights three times a week for free. Thanks. Let's be real. Most jobs, whether you're an employee or a freelancer or even self-employed, like a one-person service business, you're just a different version of the same trap. You trade your hours, you trade your energy, you trade your life for a paycheck.

1:20And here's the kicker. You can never work enough hours to get rich. There's only 24 hours in the day. We all have 24 hours in the day. No one gets more hours than the other person. No matter how good you are, You can't scale yourself. You can't make more time. That's why doctors, lawyers, consultants, people that make good money can still go broke. If they stop working, the money dries up. The truth is, if your income relies 100 % on your personal labor, you will never get rich. That's just the bottom line. So how do people actually get rich? They use something called leverage. I learned this years ago from a guy named Naval Ravikant.

2:03And he taught me that leverage means your effort produces results without requiring direct time every single moment. Meaning that you're not always using your time in order for you to get a result. And there are four main forms of leverage. The first one is labor. And that is when other people's time is being used. When you hire a team, when you hire even one person like a VA for$500 a month. that is leverage. You're no longer using your own time, your own energy, your own life to create something for your business, to create value for your customers. Somebody else is doing that now and therefore you have leverage.

2:41You're able to utilize somebody else's time. This is why when you're networking and talking to people and you learn somebody's business has 200 team members. The reason why you're impressed by that is because they have 200 people leveraging their time, their effort, their energy to build something valuable for their business. The second form of leverage is capital, money, money that works for you. That could be investments like real estate or stocks. It could be loans. You're getting a loan from the bank. It could be assets that's generating returns. This could be you taking the profits from your business and reinvesting it in your business to make it more profitable and make it more valuable.

3:16Capital is a multiplier. Leverage form number three, code. This is software. This is technology. This is tools. This is AI, things that work for you 24-7 while you sleep. For example, I had a software business called Webinar Ninja that we built and then sold. After 10 years, we got acquired. And when I was running that business, this software was being sold to people while I was sleeping, while I was on vacation, while I was having dinner, while I was playing basketball, right? 24-7, this code, this software was doing work and providing a product, a service to people to get a job done. And it was valuable to people.

3:54So people paid for it. And therefore, that code was serving me at a higher leverage because it's doing things I can do 24 seven. Fourth form of leverage media, that's content marketing, that is emails, that's podcasts, that's books, that's YouTube videos, sales videos, ads, media is a form of leverage, because you can create it once and then put it out. And many, many, many people can see it by just one creation, one piece of content can be shared and can be consumed by millions. Every wealthy person you know that has built their wealth by themselves and inherited has used one or more of these levers of leverage.

4:33That's how you break out of that time for money prison. So you're probably now seeing the uncomfortable truth. You don't build wealth with a job. You build wealth with a business. Why? Because a business is simply a machine that uses leverage. It uses labor, a team that grows and outputs beyond what one person can do. It uses capital like investors or revenue from the business to reinvest in the business and get more cash flow. It uses code like systems and automations and software to be able to serve more customers. Next, the fourth form of leverage, media, your brand, your marketing, your social media, your reputation compounds over time and earns you more money.

5:16And now with the media, there's no gatekeepers. You could create a podcast tomorrow. You could start a YouTube channel tomorrow. You don't have to get on TV anymore to get exposure. Your business is the vehicle that turns effort into exponential results. And that's the beauty of having a business. And by the way, without it, you're just sprinting on a hamster wheel faster and faster, but never really moving forward, never really going anywhere. I know this firsthand because I did that for over a decade trying to get ahead financially and couldn't because I didn't have any forms of leverage because I didn't build a business.

5:54And once I did build a business, things changed. I really saw the light. If you're still poor, It's because you're not playing the right game. That's just it. It's not because you're unlucky. It's not because you don't have the skills or you don't have the know-how. It's just that you've been playing the wrong game for a very long time. And that game doesn't actually get you much return. They say silly games get you silly rewards. You got to play the right game. And business is the right game. You're in the game of survival right now. You're just trying to survive paycheck to paycheck, client to client, hour to hour.

6:28That game is rigged against you. I know firsthand. I was a teacher, a school teacher for over a decade. And I was in that cycle. You know, I would have just enough money and then things got expensive. And now I barely have enough money. And that cycle just never ends because I have no leverage. I have no way to make exponential amount of money. Like the most I could ever get is a raise, which is like 10 % more money. But with a business, you could do something from one month to the next and double your money, triple your money, five extra money. You know, there are startups and software companies that go from zero to a hundred million dollars in a year in eight months.

7:05That's not a mistake. That is reality because these businesses are really using leverage to build that wealth. The game of wealth is all about leverage. And it starts the moment you decide to stop being a worker bee and start being a builder. Somebody that builds an asset, builds a business that serves them. That's what's beautiful about business is that you're building something that has its own intrinsic value. You're building something that is going to work for you rather than you work for it. So instead of only doing labor, start hiring labor. Even one assistant frees you up. So for example, if you hire a virtual assistant for$500 a month from the Philippines or in South America, they can take care of all this admin tasks that are on you, calendars, emails, helping you edit things proofreading helping you through ai all that kind of stuff sucks up all your time and even if it frees up 20 hours of time that is 20 hours for you to focus on building a better product marketing sales you know using tools learning tools that you can help leverage your business right instead of only spending start deploying capital even small amounts to help build your business instead of only working manually start using code start using ai automate your marketing, your sales, your fulfillment, you don't know or don't want to learn, hire somebody to do it for you.

8:28Hire somebody to build you a product or build you software to help your business or point you in the right direction because there's already ready-made tools that do a lot of things for you that you just need to kind of set up once. Instead of just staying silent and working in your room on your business, start creating with media. Share the experience. Build in public. Use social media. Every video, every post, every podcast episode that you publish is an asset that sells while you sleep. I know this firsthand. I've been running this podcast for 11 years. This podcast has opened so many doors for me, has allowed me to be able to get on stages, to get partnerships, to get sponsors, to be able to build relationships that then allowed me to sell more products and services that I sold.

9:10Listen, you don't need to deploy all four forms of leverage at once. Start with one, but you need at least one lever, one thing to get started with so that you can start to play smarter and start to escape this cycle of poverty. I'm speaking to you frankly. I'm speaking to you passionately because I've been there and it's incredibly frustrating and I'm kind of shouting at my old self and saying, hey, wake up. This is how you're supposed to do it. Because the truth is wealth, again, is not about working harder. It's about working smarter and multiplying your efforts with leverage. A lot of people think it's like, if I just work hard, I'm going to be all right.

9:48No, you got to work hard on the right things. You got to make the right decisions. You got to use what is available to you so that you can grow faster and bust out of this poverty cycle. So why are you still poor? Simply because you're still trading time for money. I'm going to drill this home. So how do you get rich? You start a business that leverages things like labor, capital, code, media. Just pick one and start small and build from there. You know, I started the first one I started with with media. I started this podcast. And then once I had that, I then moved into labor. I started hiring people and building out a team.

10:25Then I started to earn some more income. And then I invested that into code, building code. I built a software. From there, I used that and I got the revenue from the code and from the software and leveraged the capital and invest it into the business again and continue to grow because of that. So as you can see, one by one, do this. And in a few years, you're going to look back and say, why? Why did I just think grinding it out for 60 hours a week was the answer? You're going to be kicking yourself, but you're going to be glad that you decided to change. And if you want to get my honest opinion about this, is that a lot of us don't want to break out because we're scared.

11:05Because we know this concept of trading time for money. I do the work, I get paid. This is something that we're just used to from a young age. This is why we get allowances for doing our chores or whatever it is. we're never used to the idea of, oh, maybe I should be leveraging other people's time, effort, money, capital media. Maybe I should be building something that works for me. It's a foreign concept for many of us, and it's uncomfortable. And we usually don't lean into something that's uncomfortable. But I'm telling you, this is how people get rich. Look at everybody that you know and look up to that are wealthy.

11:39What do they build? A business. What do they use? leverage. Before I go, I want to leave you with this. All that passion, all that raising my voice today, it comes from a place of love. It comes from a place that I care and I want you to have a smoother, better experience than I did. It's so rough not having enough money. I know. It's incredibly stressful and it stresses every part of your life, your relationships, your family, your health, your ability to fulfill your dreams, your ability to fulfill your goals and the things that you're looking forward to, it's kind of meek. It's hard for you to even look past the next few days or the end of the month.

12:16That's horrible. I don't want anybody to go through that because I went through that and I know how bad that feels. So I'm imploring you to take the first step and start saying, okay, I know that I'm doing everything myself now, but if I need to break out of this, if I want to be able to have a bigger, better life, I need to start just with one form of leverage and start growing with that and understand that eventually I'm going to trust the process and get to where I want to go. I'm telling you, you're going to start seeing results by just using one form of leverage. You're going to start saying, okay, I see what's going on here.

12:49All right. I see that the results are proving that Omar was right. So thanks so much for listening. And I hope you take this to heart because personally, I wish somebody told this to me a whole lot earlier in my journey. If you found today's episode helpful and you want more practical business lessons to help you start, grow, and scale your business, the best thing you could do is subscribe to this podcast. Hit subscribe or follow on your favorite podcast app, the one that you're using right now, whether it's Apple or Spotify or wherever you listen to podcasts. By hitting subscribe, you get our next episode automatically and it's the best way to support the show.

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