Only one‐third of Americans have a college degree, and yet high school no longer prepares young adults for a trade or even how to find a job. And for those of you who racked up massive college debt, I am sorry to be the one to break the news to you but, research now shows that earning a degree from a major university has no long‐term impact on income, job satisfaction, or life satisfaction.
Security doesn't even exist for those working at the most prestigious corporations. Employees at successful tech companies, such as Microsoft, Google, Apple, and Amazon, keep their jobs on average for less than two years.10 Even for the most educated among us, there is no job security. The adage that security robs ambition needs to be updated: it isn't security that robs ambition, but the illusion of security that robs ambition. The good news is that it isn't too late to change your trajectory and learn how to make money.
Wealth Comes from Creating Money, Not Earning and Saving It
Before diving into the Future Proofing You process, it is important to dispel a major misconception about money that hinders most people's ability to create wealth. In the twenty‐first century, one doesn't get rich by accumulating and saving money. Slowly reread that sentence again: “One doesn't get rich by accumulating and saving money.” One gets rich by creating money. Money, and the value it represents, can be created from thin air as if by an alchemist using magic. Wealthy people create money that wouldn't have existed if not for their efforts. To comprehend this fundamental principle, we need to journey back to our formative years and revisit third‐grade arithmetic. In elementary school, most math problems went something like this:
If Jeff buys two bananas for one dollar each and sells them to Mark for two dollars each, how much did Jeff make?
In this example, the only way John makes his two‐dollar profit is by taking it from Mark's pocket. Jeff wins. Mark loses. While mathematically sound, this equation teaches children that in order to gain money, someone else has to lose money. In game theory, this is known as a zero‐sum game. Poker is a zero‐sum game. You can't win more money at a poker game than the other players bring to the table. Unfortunately, growing up with a zero‐sum perspective is like a horse wearing blinders – it limits the field of view for opportunity. For me to win, you must lose. Taken to the extreme, everyone in the world is your competition. There is only so much money to go around and if you don't take what you can, someone else will get it. As you begin your career, this point of view causes a scarcity mindset. There is never enough money to go around. At work, she got a raise so I can't. Immigrants are taking our jobs. Foreign nations are taking our jobs. Robots are taking our jobs. Technology is evil. Everyone is the enemy. Every day you live with this outlook, your life grows more and more stressful. Your life is reduced to a dog‐eat‐dog world filled with misery and despair. It is hard to have a positive outlook if this mindset has been drilled into you your whole life (and as you will soon realize, mindset is everything). But there is another perspective that is much more conducive to Future Proofing You and living a life of happiness and success.
Compare the zero‐sum game problem from your youth with this growth mindset example:
If Jeff starts a company with $1,000 and sells 10 percent of his company to investor Mark for $10,000, how much is Jeff now worth?
The answer: Jeff created a company valued at $100,000 with his $1,000 investment and still retains 90% ownership. So, Jeff is now worth $90,000. Looking at it from another angle, one person with only $1,000 and another person with only $10,000 created $90,000 from thin air. Viola! $90,000 that wasn't printed by the Federal Reserve or borrowed from a bank now exists. Jeff can spend it just as easily as you and I can spend cash. In this example, instead of the transaction being a zero‐sum game, by cooperating and working together, both Jeff and Mark made money. Jeff made so much money with this approach that he can stop purchasing bananas a few at a time and buy the whole food market! Now you understand how Amazon, which rarely turned a quarterly profit during its first 20 years in business, made Jeff Bezos the world's richest man with a whopping $188.7 billion. (On January 30, 2020, Bezos made a whopping $13.2 billion in just 15 minutes.)11 Or how Uber founder Travis Kalanick, who has never made a profit with his company or the other two companies he previously founded, is personally worth $4.8 billion. The proliferation of billionaires today is happening because it has never been easier to create vast sums of money. Startups that are valued by venture capital and investors at more than $1 billion are referred to as unicorns. In 2009 there were just four such rare creatures. As of April 2020, their number multiplied to 465.
Incredibly, each of us has the potential to be a modern‐day sorcerer with the Midas touch: we can turn anything we create into gold. What does this have to do with you making a million dollars and Future Proofing You? Everything.
The first decision you will have to make in building your fortune is to decide if you want to make money the way John Mackey did with Whole Foods Market – buying items at one price and reselling them at a higher price – or the way Jeff Bezos did with Amazon, by creating a new service with a business model that will be highly valued by investors. Both can earn you money, but only one is likely to make you a millionaire in a year.
Airbnb, Google's search engine, and cryptocurrencies such as Bitcoin are all examples of new business models that created billions of dollars that would not have otherwise existed. Airbnb monetized surplus rooms, thereby unlocking billions of dollars of stored value. Silicon Valley's venture capital firms are all based on this model. VCs look to invest in disruptive ideas that can generate at least a tenfold return on their money. The best of the best, venture capitalists who generate billions of dollars, are tracked on the Midas List. Sequoia Capital's Jim Goetz topped the 2017 Midas List by being the only person to invest in the 55‐person mobile app developer WhatsApp, which sold to Facebook for nearly $22 billion after only five years in business. What makes the WhatsApp story even more astounding is that its founder, Jan Koum, just prior to starting WhatsApp, had applied for a job to work at Facebook and was rejected. Without a job, he created his company and became one of the wealthiest billionaires on the planet. Koum, a college dropout and Ukrainian immigrant, made $7.5 billion on an idea he would have gladly given Mark Zuckerberg for free if only Facebook had hired him.12 Unlike the wealthy industrialists of the twentieth century, today's Future Proofing millionaires and billionaires don't amass wealth, they create it. And, so can you.
To benefit from the opportunities available in the twenty‐first century, you must first understand how businesses create value. As I illustrated with the previous arithmetic problems, you need to unlearn how you thought companies made money and look for ways that existing businesses can be disrupted. In my previous book, Disrupt You!, I walked readers through all the parts of the modern business value chain from research and development, design and production, through to marketing, sales, and distribution. New technologies such as mobile, social media, and blockchain provide opportunities for small startups to greatly improve upon one part of the chain and dislodge large, less nimble incumbents. Instagram upends Kodak. Netflix destroys Blockbuster and destabilizes Hollywood studios. Airbnb destabilizes the hotel industry. Uber disrupts 17 million taxi drivers. Depending on the industry, businesses can be disrupted at any link upon the chain and thereby release value that