Remarkable success popularly rests in the hands of a few whose wealth can undoubtedly be said to influence the world economies. These individuals control a large stake of their industries, are respected by millions (and sometimes billions) of people, and have a strong influence in their governments. Their successes vary in large degrees, but are governed by principles which helped them attain or maintain their billionaire status.
Becoming a billionaire goes beyond the principles of becoming a millionaire, and as such, only a handful of the world’s population have had the chance to attain this financial status. Their strategies, commitments, relentless efforts, motivation, networks, and business solutions, have to a great degree, helped them grow large conglomerates. But what has truly distinguished them from the crowd are the billionaire investing secrets they’ve implemented every single step of the way.
If you’ve ever wondered how billionaires like Aliko Dangote, Warren Buffet, and several others around the world have grown successful billion-dollar businesses, here are 7 billionaire investing secrets that have carried them every step of the way:
1). Buy When Others Are Selling:
A market in crisis is a market to take advantage of. When an industry comes crashing and people begin to panic, they do everything in their power to sell off their interests before their investments become worthless. Billionaires like Warren Buffet, Seth Klarman, Carl Icahn, and a host of others know this, and so, lookout for small failing businesses with high potentials and either invest in, or buy out completely.
These billionaires buy the shares of publicly traded companies with large potentials when they’re low, and sell when they’re high. They’ve mastered this routine so much as to retain their financial status for decades past and to come.
2). Gain A Good Understanding Of Finance, Economics, Or Accounting:
Self-made billionaires know their numbers. They spend a large part of their entrepreneurial growth gaining a deep understanding of finance, economics, and accounting. This knowledge is garnered from professional programs, the university, or experience. Their deep understanding of these principles helps them to closely monitor their cashflows, know when to bail out on an investment, the right time to increase their efforts, and the best time to maximize their profits.
These strategies and principles form the core foundations of self-made billionaires.
3) Diversify Your Investments:
Self-made billionaires know the dangers of placing all their eggs in one basket, and so, diversify their investments. What then separates them from others is they have a limited number of diversified investments, and focus largely on one or two for up to 20 to 30 years of their lives. These closely followed investments are the types that build up a billion dollar status for them.
A few billionaires with vast business portfolios but with one or two majorly highlighted revenue streams are Aliko Dangote (Dangote cement), Bill Gates (Microsoft), Warren Buffet (Berkshire Hathaway), the Waltons (Walmart), and several others.
While they have other businesses, they have some specific investments that are largely responsible for their billion dollar status.
4). Buy Or Grow A Business With Other People’s Money:
A large part of Warren Buffets wealth was acquired through trading with other people’s money on the stock market. Even Mark Zuckerberg started off Facebook with a partner of his, who was entirely responsible for the initial funding, and Aliko Dangote started his business with a loan from his grand father.
One valuable billionaire investing secret is to start whatever you want to, with other people’s money, in other to minimize risks and increase the chances of you staying afloat in your personal finances.
By seeking investments, loans, and more, from external bodies or individuals, you can keep your own hard earned cash contained, and grow your net worth from the funds made available to you.
5). Use Partnerships To Compliment Your Expertise:
Partnerships build trust and compliment experience. It makes the consumers of the partner brand trust you more and vice versa. By building up strategic partnerships, you open up your business to more growth, expertise, investments, and a lot more financial benefits.
6). Focus More On Cashflow Than On Valuations:
Cashflow rules. Most people invest based on valuations. While this is a good bet, some billionaires warn largely against it in many circumstances.
Many companies that remained unprofitable for several years eventually shutdown and resulted in an entire loss of the investors money. The problems with this startups was their valuations were based on the previous value of the last investment, and if the previous investor invested recklessly, the new investors may end up putting in their funds for an even worse valuation.
Rather than invest based on the current valuation, study the numbers the company is generating, analyse their cash burn rate to know how money leaves their bank accounts, and determine if there’s any logical chance of profitability in the near future.
If your chance at cashing out on your investment is based on another investor buying in at a larger valuation, then it’s probably a bad investment decision to make.
7). Start Young:
Above all else, it’s important to start young in most situations.
Billionaires like Warren Buffet, Aliko Dangote, Mark Zuckerberg, Bill Gates, Richard Branson, and a lot more, started their businesses in their teen or twenties. They built the foundations of their companies then, and grew them to what they are today.
While there are exceptions like Colonel Harland Sanders (founder of Kentucky Fried Chicken) and several others who started their businesses much later in life, it still doesn’t dispute the fact that one of the most important billionaire investing secrets is to start young and chase your dreams harder, smarter, and better than anyone else you know.
What are your thoughts on how to make money using these 7 billionaire investing secrets? Let me know by leaving a comment below.