- Billionaire Mark Cuban says "only a moron gets a loan
to start a business."
And I think there's some truth to that,
that if you're starting a business
if you are getting a loan, chances are maybe
you are not quite ready.
Now, if you're Tech company you raise capital,
you have an idea for Tech.
I mean I don't see a problem with that.
But borrowing money from a bank to start a business,
personally I don't like the idea.
I think it's a little bit risky especially when
you don't have a lot of business experience.
If this is your first business that you're starting.
Now, after you have some experience,
borrowing money from the banks to buy a business
an existing business, I think as an acquisition
I think that's a very smart way to do it.
Because your using, basically commercial debt to,
at a very low interest rate to grow your business
to start something once you,
once it's a big big but, once you have a solid understanding
and, how business works and also have a solid track record.
That's, that's my take.
So, in terms of your property, selling your property
to put into your business keep in mind if you're referring
to this as your primary residence
that's what I'm assuming.
If that's the case, I think it's also very risky
because what if that business doesn't work.
Now, you have a business that's losing money plus,
now you're putting your place, your home at risk
then what happens if it doesn't work then actually
you're homeless.
In my mind, this is why in my book even Unlock It,
I talked about The Wealth Triangle.
They're three steps to it.
The first step is what I call High-Income Skills,
skills that pays the bills.
The second step is the Scalable Business,
that's when you actually start a business.
Not any business, a Scalable Business.
Then a third is High Return Investments.
I think a safer, smarter more intelligent way to go is
to actually have the skills that produce income first then,
take that money into starting that business versus
taking your primary residence, you take a mortgage out,
you borrow money or you sell one of your investments.
Could be Stocks, could be Real Estate
then to fund your business I don't think
that's a very smart way to go.
Because if you need to do that, chances are
there's a lot of risk within this new business
that you're starting.
Are there other ways that we can minimize that risk?
There are many ways to do it, right.
You can even shadow under someone
who has a business like that, just to see what that is like.
Think about the odds, 95% of Small Businesses fail
in the first five years.
It's a high percentage, so when you know
when you risk something that you already have
betting on something that chances are nine out of 10,
you will lose.
That is not a very smart thing,
unless you know the industry very very well.
You have a lot of Business Skills,
that you are a very savvy business person
then use leverage, otherwise I am very much
against that idea.
That's just my take, some say that "hey man you got to
take risk, you got to mortgage your home, you got to
go all in."
I did that in my early years, it is very very difficult
when you lose all that money, money that you didn't have
and I had to borrow money from family and friends
and lost all my Mom's money, it's difficult.
So this is speaking me, Dan Lok speaking from experience.
I would not suggest you do that.
Figure out smarter ways to see what can you do
to use your skills, develop some skill sets
to make money first, to generate that income first.
If you want to get a copy of my Unlock It book
you can click the link below or somewhere here.
In the book I talk a lot more about The Wealth Triangle
and what are some of the High Income skills
that you could develop.
What kind of Scalable Business that I would recommend.
You can just get a copy, just pay shipping and handling
and I will send the book to you.
So go ahead and click the link and get a book today.