Several years ago I asked a colleague “What do you need to retire?”
His answer: “$5 million and playmates.”
Playmates?
What he meant was having enough leisure-time folks to hang out with during the day.
So, about the “magic number” …
Archive for the ‘Income & Wealth’ Category
What’s the “magic number” that makes you wealthy?
May 20, 2019Are you a “producer” or a performer?
June 9, 2016Prior posts have channeled some work by PwC identifying traits that mark self-made billionaires.
Broadly speaking, the PwC study sorts business folks as “producers” or “performers”.
Producers are skilled at conceiving new ideas and bringing them to market.
Performers: They know how to optimize the known systems and products of an organization, and how to make the most of existing practices.
Which are you, a producer or a performer?
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Here’s a 9-question categorization quiz from Strategy + Business:
Click to take the producer-performer quiz
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S+B observes:
You might have to fill both roles at different times.
“After all, anyone who can launch a new product must have some ability as a performer. Similarly, most skilled performers also have some producer talent.”
But it’s rare for one person to excel as both a producer and a performer.
So if you’re aware of what you do best, you can more easily establish yourself in the most suitable environment, with the right complementary people, and map out your ideal role.
You’ll also know when to ask for help.
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How do self-made billionaires self-make their billions?
June 8, 2016Yesterday, we posted that there are about 1,800 billionaires in the world and that about 2/3s of them are self-made … not just born lucky.
According to a PwC study, the self-made billionaires usually started at a big company, some were fired from the big companies, and most became serial entrepreneurs.
Usually they got on the map with their first or second venture, but built their wealth through a series of successive (and highly successful) ventures.
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The PwC study also identified 5 traits that were relatively common across the self-made billionaires.
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Broadly speaking, PwC says concludes that most business managers are “performers” – linear logicians who are good at execution .
The self-made billionaires are “producers” who look at the world from different angles — allowing them to spot opportunities and to turn good ideas into great businesses.
More specifically, the PxC team concluded that “most self-made billionaires – the “producers” –practice five habits of mind — ways of thinking and acting that generate uncommonly effective ideas and approaches to leadership.”
The 5 traits:
1. Ideas: Empathetic Imagination
The producers typically worked in their field long enough to have an awareness of critical trends, empathy for customers, and knowledge of existing practices. Then, they added a healthy dose of imagination to change the game.
2. Time: Patient Urgency
“The creation of massive value in an industry does not happen overnight. The billion-dollar idea often comes after years, even decades, of commitment to a market space. Skilled producers learn to be patient. They know how to wait for the right idea at the right time. But once they hit on a compelling idea, they have a bias toward action that compels them to take urgent steps.
3. Action: Inventive Execution
Many executives take product design and go-to-market strategies as givens. “The business model, pricing, functions, sales pitch, and deal structure are treated as inherited, predefined by the models, costs, and pricing that already exist in the company and industry.“
Producers redesign opportunities everywhere – both in the product – broadly defined – and the implementation.
4. Risk: Relative, Not Absolute
“Producers, in general, are distinguished not by the level of risk they take, but by their attitude about risk. Most people measure risk in absolute terms: Will this business succeed or fail? Producers view risk in relative terms: Which option presents the greatest opportunity? If the opportunity is right in a risky venture, they’ll look for ways to mitigate risk”
5. Leadership: Teaming with Performers
“The idea of the solo genius is so pervasive in the way people talk about and think about extraordinary success that it obscures the real story of how good ideas become great businesses. Self-made billionaires are not alone. Producers have the ability to see beyond the parameters of what exists today to imagine new opportunities. Performers, in turn, have the ability to optimize and achieve within known parameters. Value creation requires both.”
Producers surround themselves with producers …
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Bottom line:
Yeah, wealth distribution is skewed. No argument there.
But, it’s wildly misleading to characterize the richest of the rich as folks who were just born lucky.
The majority of the made their own luck … and earned their wealth.
Sorry, if the facts don’t match the popular narrative …
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Tomorrow, take the Producer Quiz …
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How many billionaires are there? How many are self-made?
June 7, 2016With all of the vitriol now being cast at rich people, and with all of the broad-brush policy proposals to redistribute their wealth … you’re probably guessing a pretty big number, right?
Well, Forbes reports about 1,800 billionaires worldwide … holding $7 trillion… or roughly 7% of the total global gross domestic product.
1.800 isn’t a particularly big number, right?
But, even I concede, they skew the distribution of wealth.
The billionaires always seem to get caricatured as Saudi princes, one of Sam Walton’s descendants or Paris Hilton – all just lucky by birth and clearly undeserving.
Well, PwC’s think tank dug deeper into the numbers and uncovered some facts that tend to disrupt the popular narrative …
The American Dream is dead … err, not really.
January 6, 2016Over the past couple of weeks, there has been an endless series of media spots about some Pew Research data demonstrating, beyond the shadow of a doubt, that the middle class is shrinking.
A common headline played off the rich are getting richer. theme:
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Pretty dire, right?
Not so fast.
Digging deeper into the Pew numbers paints a different picture…
Daily Mail: “Chelsea takes the plunge” >>>
August 21, 2015WARNING: Disturbing Content
We’re temporarily suspending the HomaFiles usually high editorial standards … this is a story that must be told.
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Earlier this week, the UK’s Daily Mail led it’s coverage with the following story:
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The article has so many angles that it’s a ‘must view to believe ” …
Rich man: “What inequality?”
August 12, 2015According to a CNBC summary of a study published in the Journal Psychological Science …
The richer you are, the more likely you are to think that others are wealthy, too.
According to the study’s authors, the reason for the misconception is simple …
How do self-made billionaires self-make their billions?
July 31, 2015Previously, we posted that there are about 1,800 billionaires in the world and that about 2/3s of them are self-made … not just born lucky.
According to a PwC study, the self-made billionaires usually started at a big company, some were fired from the big companies, and most became serial entrepreneurs.
Usually they got on the map with their first or second venture, but built their wealth through a series of successive (and highly successful) ventures.
=====
The PwC study also identified 5 traits that were relatively common across the self-made billionaires.
======
Broadly speaking, PwC says concludes that most business managers are “performers” – linear logicians who are good at execution .
The self-made billionaires are “producers” who look at the world from different angles — allowing them to spot opportunities and to turn good ideas into great businesses.
More specifically, the PxC team concluded that “most self-made billionaires – the “producers” –practice five habits of mind — ways of thinking and acting that generate uncommonly effective ideas and approaches to leadership.”
The 5 traits:
1. Ideas: Empathetic Imagination
The producers typically worked in their field long enough to have an awareness of critical trends, empathy for customers, and knowledge of existing practices. Then, they added a healthy dose of imagination to change the game.
2. Time: Patient Urgency
“The creation of massive value in an industry does not happen overnight. The billion-dollar idea often comes after years, even decades, of commitment to a market space. Skilled producers learn to be patient. They know how to wait for the right idea at the right time. But once they hit on a compelling idea, they have a bias toward action that compels them to take urgent steps.
3. Action: Inventive Execution
Many executives take product design and go-to-market strategies as givens. “The business model, pricing, functions, sales pitch, and deal structure are treated as inherited, predefined by the models, costs, and pricing that already exist in the company and industry.“
Producers redesign opportunities everywhere – both in the product – broadly defined – and the implementation.
4. Risk: Relative, Not Absolute
“Producers, in general, are distinguished not by the level of risk they take, but by their attitude about risk. Most people measure risk in absolute terms: Will this business succeed or fail? Producers view risk in relative terms: Which option presents the greatest opportunity? If the opportunity is right in a risky venture, they’ll look for ways to mitigate risk”
5. Leadership: Teaming with Performers
“The idea of the solo genius is so pervasive in the way people talk about and think about extraordinary success that it obscures the real story of how good ideas become great businesses. Self-made billionaires are not alone. Producers have the ability to see beyond the parameters of what exists today to imagine new opportunities. Performers, in turn, have the ability to optimize and achieve within known parameters. Value creation requires both.”
Producers surround themselves with producers …
=====
Bottom line:
Yeah, wealth distribution is skewed. No argument there.
But, it’s wildly misleading to characterize the richest of the rich as folks who were just born lucky.
The majority of the made their own luck … and earned their wealth.
Sorry, if the facts don’t match the popular narrative …
=====
#HomaFiles
Follow on Twitter @KenHoma >> Latest Posts
=====
How many billionaires are there? How many are self-made?
July 30, 2015With all of the vitriol now being cast at rich people, and with all of the broad-brush policy proposals to redistribute their wealth … you’re probably guessing a pretty big number, right?
Well, Forbes reports about 1,800 billionaires worldwide … holding $7 trillion… or roughly 7% of the total global gross domestic product.
1.800 isn’t a particularly big number, right?
But, even I concede, they skew the distribution of wealth.
The billionaires always seem to get caricatured as Saudi princes, one of Sam Walton’s descendants or Paris Hilton – all just lucky by birth and clearly undeserving.
Well, PwC’s think tank dug deeper into the numbers and uncovered some facts that tend to disrupt the popular narrative …
Who really benefits from increases in the minimum wage ?
July 9, 2014An article in the WSJ this week is causing a bit of a stir.
Titled “Who Really Gets the Minimum Wage”, the report concluded that Minimum wages are ineffective at helping poor families because such a small share of the benefits flow to them.
Specifically, “Obama’s $10.10 target would steer only 18% of the benefits to poor families; 29% would go to families with incomes three times the poverty level.”
Hmmm.
How does that happen?
The essence of the dynamic: counter-intuitively, low-wage workers and low-income (i.e. “poor”) families are not the same folks.
According to the article, data from the U.S. Census Bureau show that there is only a weak relationship between being a low-wage worker and being poor.
Three reasons for that:.
- Many low-wage workers are in higher-income families—workers who are not the primary breadwinners and often contribute a small share of their family’s income.
- Some workers in poor families earn higher wages but don’t work enough hours (and have hours cut when the minimum wage goes up)
- About half of poor families have no workers, in which case a higher minimum wage does no good. This is simple descriptive evidence and is not disputed by economists.
Bottom line: Not much help to the well-intended anti-poverty movement.
There’s another “non-poor” group that benefits when the minimum wage is raised..
Glance at the picture above and see if you can guess who that is.
How many millionaires & billionaires are there in the US ?
December 4, 2012
Based on a very rigorous analysis by Robert Wolff of NYU …
Scored in constant 1995 dollars – i.e. eliminating the effects of inflation …
- Roughly 6.5% of US households – about 7.5 million — have a net worth greater than $1 million.
- That’s up 5.25% since 2007 … an increase from 6.3% of households
- But, the number of households with net worth greater than $5 million declined by 27.5% from 2007
- And, the number of households with net worth greater than $10 million declined by 25% from 2007
Bottom line: More millionaires … but they have fewer millions.
Source: Wolff, NYU, Asset Price Meltdown and Wealth of the Middle Class
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