My Rating: 9/10
Amazon Rating: 4.7/5
My Personal Take
As an individual who just graduated with a master from university back in 2017, I am following what the society dictates us to do: get competitive, work hard, get promoted and earn a decent income. I worked really hard and got promoted twice in less than 3 years in a reasonably competitive environment. As I continue to work hard and bring values to my employers, I do see some limitations on using my limited labour hours in exchange for money so during my spare time when I am not working, I start exploring on different topics such as passive income, side income, stock investing, cryptocurrency and etc. I am a big fan of reading so I discovered this book in the process. This book has given me some clues or hints on how we could best possibly accumulate wealth in the long run. This is a very intense book, I will only focus on the practical side of things as MJ also spends a significant part on differentiating the slowlane vs fastlane which you can read from the full edition of the book.
My favourite quote
Be a producer, not a consumer.
The Law of Effection
The more lives you affect in an entity you control, in scale and/or magnitude, the richer you will become.
- Impact millions and make millions!
- Think big to earn big.
- Wealth = Net Profit + Asset Value
Net Profit = Units Sold (Scale) x Unit Profit (Magnitude)
Asset Value = Net Profit X Industry Multiple
- There is only 2 variable to remember, Units Sold and Unit Profit, best case scenario is to have high number for both!
- For the asset value, we must also know when to liquidate or exit our business! Liquidation events transform appreciated assets (“paper” net worth) into money (“real” net worth). We can then pump the money into a passive money system.
Let's look at 1 word that you should remember after reading this summary: CENTS. Based on the author, there are five fastlane commandments which are CONTROL(C), ENTRY(E), NEEDS(N), TIME(T), SCALE(S).
The Commandment of Control
Be a driver, not a passenger.
- ✅ Drivers create MLM companies ❌ they don’t join them.
- ✅ Drivers sell franchises ❌ they don’t buy them.
- ✅ Drivers offer employment ❌ they don’t get employed.
- ✅Drivers accept rents and royalties ❌ they don’t pay rents and royalties.
- ✅ Drivers sell IPO shares ❌ they don’t buy them.
We should not hitchike if possible because when the driver flips a switch, you are basically screwed. For example, if your income is solely dependent on a single source without having much control, when it breaks, your life will be in a turmoil.
Invest in your own BRAND whenever possible instead of other brands.
The Commandment of Entry 🚪
Low barrier of entry = high competition = slow down your fastlane
It's definitely not true that you should always avoid commandment of entry at all cost since it would not make sense. In order to strive in a field with low barrier of entry, prepared to be exceptional, for example to be a great footballer like Ronaldo or Messi, you will have to be really exceptional.
Entry is a process, not an event. For example, if you are in the business because you took one or two actions, you violate entry since everyone can do it! If everyone is doing it, it's generally a red flag.
If you want to live unlike everyone, you can't be like everyone.
The Commandment of Needs 🛍
Businesses that solve needs and provide value will always win.
Nobody actually care about "do what you love", this strikes me hard. We have been told our whole life that we should do what we really love. In reality, people only care about what your business can help them, basically what's in it for them?
Stop chasing money and start chasing customer's needs instead. Never start a business just to make money.
- I need a new income stream
- I am an expert in XX so I'll do YY
- People say you will get rich by starting a business
Impact millions and you will make millions 💸
- Make one feels better or looks better (health, nutrition, clothing, makeup)
- Simplify life
- Enhance one's dream and give hope
Do what you love and money will follow, this statement does not work most of the time. I would not say it will never work at all but I have seen many cases out there once I start observing.
Passion beats what you love, if you want to achieve something, you will do whatever it takes to reach it.
- I want to pay off my education loan
- I want to make a difference and impact millions
- I want to write a book without worrying about money
- I wan to wake up without an alarm clock
- I want to pay off my own or parent's mortgage
The Commandment of Time ⏰
To ask 🙋♀️🙋♂️
- Can the business be automated and systematized while I'm away?
- Are my margins thick enough to hire enough manpower?
- How can I get this business to operate without my time?
A business attached to your time is just another job. A business that earns income exclusive of your time will satisfy the commandment of time.
The Commandment of Scale 🌎
Wealth = Net Profit + Asset Value
- Net Profit = Units Sold X Profit Per Unit, if you have a ceiling on units sold, you are not in an ideal spot.
To ask 🙋♀️🙋♂️
- Can the net income of this business scale limitlessly, let's say from $5000/month to $200,000/month?
- Can the asset value of the business scales into millions?
- Can the business impact millions? Or it impacts hundreds? What is the customer pool?
- Can the business be replicated/expanded through franchising, chaining or additional units?
- Best-case scenario, what is the units-sold potential? 100 or 100 millions?Best net profit per unit?
Impact millions to make millions 💸
What do you want?
- A Ferrari
- A 6,000-square-foot house with a pool
- Travel three months a year
- Private school for my children
Assess the Cost
How much do your dreams cost per month in term of lifestyle cost, gross living cost and net living cost?
- Ferrari: $3,000
- House: $5,000
- Travel: $1,000
- Private School: $1,000
Lifestyle Cost = $10,000/month
Next, determine your monthly allowance and other unknown cost such as clothes, gadgets, toys for the children, health insurance, etc.
Gross Living Cost = $10,000/month (Lifestyle Cost) + $4,000/month (Allowances)
Gross Living Cost = $14,000/month
Next, determine your Net Living Cost by dividing Gross Living Cost by .60, or 60%, assuming 40% potential taxes.
Net Living Cost = $14,000 / .60 = $23,333/month
Set the Targets
Set the money system and business income targets.
- Money System Target = ($23,333 × 12) / .05 = $6,000,000, assuming 5% annual return. This means that once you hit this $6 million, you can retire immediately!
- Business System Target = ($14,000 × 5) = $70,000/month.
40% go to tax, 40% go to fund your money system, 20% pay for your lifestyle. This approach will deliver your target lifestyle AND simultaneously funds your money system as shown above.
Make it Real
Fund it and open it!
- Start small, if you want to earn $5,000 per month, start from $50 per month
- Drop your loose change into a can at the end of each day. When you drop the change into your bucket daily, you are training yourself to visualise your goal moving closer. It will force you to evaluate, have you applied pressure to your goal? Are you still pursuing a fastlane business or you are still attached to a slowlane job?
- Fund your money system at a brokerage firm and slowly see how it grows over the year.
In order to really succeed in your fastlane, handling customer will be your biggest priority! Make sure you log down all customer complaints because they are the one funding your profit eventually! Do not underestimate the word of mouth and also customer lifetime value.
Complaints of Change
- Customers start complaining once you change something, so it's a bad change.
Complaints of Expectation
- Customers did not get what they expect, you either fix the expectation or identify why your service fail. For example, customer orders a well cooked meat but you serve it raw.
Complaints of Void
- Customer request missing feature, this is very valuable as they expose unmet needs.
Complaints of Fraud
- Sometimes, you just meet customers who want to screw you up. Move on.
Instead of SUCKS, use SUCS
- Superior Unexpected Customer Service
- To provide great customer service and explode your business, determine your customers' expectation profile.
What are their expectations when they deal with your business? How do they relate to competitors and similar businesses in your industry? Think of how your customers will expect your service. Then VIOLATE it.
Don't forget your customer is FREE human resource systems that can help promote your business! For example, I really like this book and I am writing an article to promote this book on my blog. I would highly recommend anyone to get a copy instead of just relying on my summary as I might not convey an idea as best as what MJ wish for. Satisfied customers will have a dual residual effect: repeat business and new business via recommendations.
Unique Selling Preposition (USP)
What makes your company different from the rest? What sets your business apart? What will make a customer to use yours over someone else?
- For example, "pizza delivered to your door in 30 minutes or less - else it's free"
Step 1: Uncover the Benefit(s)
- Find the greatest benefit of your product, one that sets it apart from the competitors.
Step 2: Be Unique
- Use powerful action verbs such as
"Lose weight" → "Obliterate fat" / "Shred pounds" ,
"Grow business" → "Explode revenues" / "Shatter sales records"
- Create customer divergence when comes to buying decision. For example, if you choose a Mac over a PC, you are choosing safety, speed, reliability over functionalities and bloatware.
Step 3: Be Specific and Give Evidence
Website: “Your car sold in 20 days or less or it’s free.”
Product: “Drop 20 pounds or you don’t pay a dime.”
Service: “Your home sold in 30 days or I own it.”
Step 4: Keep it Short, Clear and Concise
Step 5: Integrate your USP into ALL Marketing Materials
- Trucks, vehicles, building
- Advertising and promotional materials
- Business cards, letterheads, signs, brochures, and flyers
- Your website and your email signature
Step 6: Make It Real
- Promise and do exactly what your USP says!
How to Rise Above Noise
If you get someone's attention, you have won half the battle!
- Polarize (extreme viewpoints/message) e.g. Android vs IOS, politics, Mac vs PC
- Arouse emotions, if you can move your audience's emotions and make them care, they will buy
- Be interactive, launch a survey "Are you spending the Fastlane or stuck in the Slowlane? "Find out what happens next ...visit xxx website". People have a natural disposition to talk about themselves!
- Be unconventional, a Ferrari sold for one dollar!
- Avoid commoditisation (a product or service that appears homogenous among providers such as airline/petrol station) whenever possible.
- Price implies value, the more expensive your price, the higher its perceived value.
- Mind your own business instead of paying too much attention on the competitors. Be proactive instead of reactive. Forget your competitors 95% of time and use the 5% to exploit their weaknesses to differentiate your business. e.g. their customer service sucks and they are rude to customer (do not reply text/phone), I will make sure my business does the opposite!
What Can You Do Now?
To live unlike everyone else, you have to do what everyone else won't
- One home run could set you financially secure for your life, perhaps generations. Focus on one big business and make it a home run business.
- There is never perfect timing and waiting for "someday" just wastes time. Smack "Someday ..." “I’m waiting for a promotion.” “I’m waiting for my kids to be older.” “I’m waiting for the new year.” “I’m waiting to finish school.” “I’m waiting for the economy turn around.” “I’m waiting until I fix the hot-water heater.” “I’m waiting for this . . .”“I’m waiting for that . .
Find Your Open Road
- ✅ Someone is aways already doing It.
So what? Do it better.
- ✅ Forget the big idea, go for better.
Skip the big idea and go for big execution.
- ❌ “I hate . . .”
What do you hate? Solve the hate.
- ❌ “I don’t like . . .”
What don’t you like? Remove the dislike.
- ❌ “This frustrates me . . .”
What is frustrating? Remove the frustration.
- ❌ “Why is this like this?”
I don’t know, why is it? Remove the “why".
- ❌ “Do I have to?”
Do you? Remove the “have to".
- ❌ “I wish there was . . .”
What do you wish? If you wish, others wish too. Make wishes come true.
- ❌ “I’m tired of . . .”
What are you tired of? Fix someone’s tiresomeness.
- ❌ "This sucks . . .”
What sucks? Remove or reduce suckage.
I hope you have fun reading this summary and be able to be live the life you want one day! Everything always starts from a belief. 😇 Good luck! You can support the author of this book and my summarised work by purchasing the book from the link I share above. Thank you! 🙏