
Mark Cuban on How to Get Rich - joshstaiger
http://blogmaverick.com/2008/10/04/how-to-get-rich/
======
mikesabat
A somewhat relevant story. 3 months ago I started saving and researching Costa
Rican real estate. I figure that over the next two years a lot of people will
be having a cash crunch and it will be a buyer's market in (somewhat over-
built) Costa Rica.

Right now I'm not where I need to be in terms of savings or knowledge, but in
10-16 months I will be.

The interesting thing is that I have started talking to agents in CR and I can
almost see things beginning to unfold. The people I'm talking to start
throwing "deals" at me. It starts like "I know this may be a little soon, but
I may have the perfect rental property for you" says the real estate agent.
"It's $225, if you can bring 80k to the table the selling can finance the rest
over 5 years"

"Sorry, not interested. I'm just not ready, I need to do more research" I say.

"Hi Mike, I spoke with the seller again. He can bring the price down to $200k,
with financing over 10 years."

I say again that I'm about 18 months away from pulling the trigger.

The agent comes back with "We can probably go under $200k finance for 15 years
(at about 9%) and we can furnish the place for you - a 12-15k value."

Now I don't (yet) know if this is a good deal or notbut it is pretty easy to
see the leverage working here. Because I'm on the right side of the market I
can throw out a low offer and see what happens. I'm not going to.

Hopefully in about a year, I will be walking in and everyone else will be
running the other way, needing to sell.

I understand that everyone @ hacker news is smart enough to "get" this, but it
is cool to see this in action.

~~~
jraines
my apologies -- I originally read that as "not everyone" and took it as odd
misplaced arrogance. But it was a reading fail. Definitely deserve those
downvotes.

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prakash
Mark gives good advice.

1\. Have the discipline to save

2\. Find an area you are passionate about and invest in yourself to become
really really good

3\. When the opportunity presents itself, make good use of it

“Luck is what happens when preparation meets opportunity.” Seneca

~~~
noor420
We should make a post with collection of advices on 'how to get rich' from
people who actually are rich, like Cuban.

Maybe a collection of blog posts?

~~~
Prrometheus
And then we could publish it and get rich!

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pkrumins
"The 2nd rule for getting rich is getting smart. Investing your time in
yourself and becoming knowledgeable about the business of something you really
love to do"

and

"Before or after work and on weekends, every single day, read everything there
is to read about the business. Go to trade shows, read the trade magazines,
spend a lot of time talking to the people you do business with about their
business and the people they buy from.

This is not a short term project. We aren’t talking days. We aren’t talking
months. We are talking years. Lots of years and maybe decades. I didn’t say
this was a get rich quick scheme. This is a get rich path"

That's what I have been constantly telling everyone. Be passionate about what
you do and don't waste your time on anything else than your passion.

~~~
vaksel
its not like it'll hurt you. If your business is created around your hobby
you'll get a lot more satisfaction out of it. And if you are passionate about
something you'll be more successful

------
cardmagic
"If you use a credit card, you dont want to be rich"

That is such an over-statement. You've got to spend money to make money. Using
credit wisely might be the only way for some people to break out of their
financial status.

~~~
jobeirne
Good point.

Using a credit card is important to establish credit. What's more important is
NEVER GETTING INTO DEBT.

~~~
hugh
What's the point of establishing credit if I'm never planning to go into debt?

This is actually a serious question -- I've been in the US for three years and
I haven't bothered to acquire a local credit card, so my credit report is
completely blank. Are there circumstances under which this can come around and
bite me in the arse?

~~~
cookiecaper
Credit is useful for a lot of things, and it's not likely that you'll _never_
need to go into debt. Credit is a tool that can be used properly or abused,
just like anything else. It's important to have good credit ... even if you
never plan on needing a loan, it prepares you in case a circumstance arises
where it is necessary to obtain one, and it's just smart to have good credit
established.

Never spend money you don't have, just charge things to your card and pay it
off at the end of the month (or carry a balance a couple of months at a time
once in a while, some people say this improves your credit score, and some
companies will get pissed and cancel your account if they're not making at
least some interest). Then, if you ever need it, that credit history will be
there, and it is often used for things besides debt. They generally check
credit when you go to rent an apartment, etc. Some people are even checking
the credit of job candidates now. It's good to have good credit history.

~~~
hhm
_Never spend money you don't have, just charge things to your card and pay it
off at the end of the month_

Isn't a debit card better for that?

~~~
cookiecaper
A debit card doesn't count as credit in most cases.

~~~
hhm
Wouldn't using a debit card it be a better way of not spending money you don't
have?

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ojbyrne
1\. Get a job 2. Save money. Wow, what insight. Though I think this could also
be titled "How to Get Diabetes."

~~~
fallentimes
3\. There are no shortcuts (here's to you MLM slimers) 4. Know your business
inside and out 5. Read about your business every day (i.e. become the smartest
guy in the room) 6. Cash is king 7. buy & hold without flexibility is for
suckers 8. be patient

~~~
cookiecaper
Having previously worked in IT for a medium-sized MLM, I can tell you that at
least some of our distributors were getting relatively rich off of it. We cut
at least ten or fifteen checks for more than 10k each month, the top usually
being around $25k.

If you invest the effort, you can make it with an MLM. Of course, there are
much better and/or easier ways, but I don't think that it's fair to call all
MLMs "slimers". Most of our distributors signed up because they loved the
product and it gave them a network to socialize about it with. They generally
made enough money to purchase the products they'd be purchasing anyway and
have a few bucks left over. I don't see the problem in this, really, as long
as your company is up-front about it and focuses on the products and not the
"get rich quick" stuff.

It's a great way for the entrepeneur to get rich, though. Works really well
from what I've seen.

~~~
fallentimes
You're focusing on the exception; I'm focusing on the rule. Sure I believe you
but the vast majority (Amway, Cutco, Quixtar, Herbalife, et al) are the ones
that are full of slime, false promises & proliferate themselves every where.
There's a huge difference between being an MLM and being an affiliate. The
former you're forced to sell to friends and family, the latter you are not.

------
xiaoma
I'm not quite sure what his problem with "buy and hold suckers" is. Benjamin
Graham and Warren Buffet both built financial empires by doing just that.
Peter Lynch didn't too too badly, either. As of now, the only investing
strategy which consistently beats the market in the long run is long-term
value investing. The technical traders, such as Cramer may do well over 5 or
10 year stretches, but they inevitably have their melt-downs that wipe out
everything.

When the market takes a dive, "buy and hold suckers" just keep buying. This
leads to dollar cost averaging benefits that lead to even greater long-term
market outperformance.

Everything else in the post struck a chord with me. It seems that discipline
is king.

~~~
nostrademons
He and Buffett/Lynch are talking past each other. Buffett's strategy has
always been buy & hold, _but only buy when the price is right_. So in the tail
end of a bull market (like what we got in 06-07, or 97-00), he just refuses to
invest and holds the cash income his stocks churn off instead. So when the
market turns downwards, he has plenty of cash to invest.

Mark Cuban's referring to the suckers who believe in putting every dollar they
have into the stock market, whether it's high or low. Those people end up with
no cash when the market turns down, so they can't take advantage of the
opportunity.

~~~
fallentimes
And more importantly, it's _flexible_ buy & hold meaning he can sell whenever
he wants. If you buy & hold with a very firm sell date you're not doing it
right.

It's hard to really know whether the stock market is "high" or "low" (if you
did, you'd be rich) that's why it's important to invest slowly at all times
(dollar cost averaging).

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rms
btw I recall an interview with Mark Cuban saying he answers about 5% of cold
emails containing businesses/business ideas. Give him a try...

~~~
ivankirigin
If you have the remotest way to get someone he knows to tell him about your
idea, do that instead. Generally, cold emails & calls mean much, much less
than a personal introduction.

~~~
davidw
Hey, with a 5% chance, all you have to do is send him 20 times more emails!

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mamama
Mark Cuban on how to become an innumerate tool:
<http://bramcohen.livejournal.com/35949.html?thread=516461>.

~~~
nihilocrat
Hey, I remember reading that post (I subscribe to Bram's blog). I had never
heard of Mark Cuban before, so I ended up only remembering him because he is
terrible at writing.

------
Mistone
"Busts are when rich people started on their path to wealth." very timely.

its the people that are up and running when it turns that appear "lucky", when
in reality they had been building during the downturn.

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redorb
my aunt and other rich people i know always shared 'pay yourself first' , my
aunt and uncle used that money (after 5 years) to get bonded in order to build
their first stadium.

~~~
utnick
what do you mean 'build their own stadium'?

~~~
redorb
no, they own a construction company. Its funny cause I asked to build them a
website and 'modernize' their business. My uncle then told me about how he
hasn't had to bid a job in years because of his reputation.. (a whole nother
business lesson)

------
Fuca
The most valuable lesson here is: persevere in doing what you like and you
will succeed.

------
Allocator2008
Diversify and hedge. Name of the game. People I work with have seen their
401K's eviscerated. Mine is more or less OK, because it is "heavily weighted"
into money markets, which are safer than equity markets. The "rule of thumb"
for people in their 20's and 30's is to have 70% of the 401K in equity
markets. I didn't follow that, and instead reduced my position in equities and
increased my position in money markets, when it came to my own 401K. Now I am
more or less OK while my collegues are scrambling to sell.

~~~
LPTS
401K? To get rich. Fuck that shit. How about: "Never work at a job with a
401K!" as a rule for how to get rich. Since your alternatives will then be to
be poor and miserable or get really rich, you will be more motivated.

Personally, I'd shoot myself in my head if I ever caught myself thinking about
protecting my 401K between money markets and equity markets. Figure out
something meaningful. Name of my game. Hoarding biosurvival tickets earned
working like some chipmunk trying to survive an endless winter that will
inevitably kill them, so that you can enjoy the fleeting illusions of
stability and more prosperity than your neighbor before your body turns to the
same worm food theirs does seems a really shitty way to respond to finding
yourself alive on this planet with a good mind and a brief window of autonomy
where you might do something really meaningful.

~~~
nihilocrat
I pretty much agree with your core idea here; "not having a 401k forces you to
take care of your own retirement savings".

However, it seems like you think that saving for retirement is completely
stupid. I don't mean to insult, but it sounds like when you feel like you
can't make money anymore, you're going to down a bottle of whiskey and blow
your brains out. Financially, that's actually probably the better idea, since
you don't have to worry about having money for a zero-productivity endgame.
The downside is you miss out on a lot of non-money advantages of retirement
(grandkids, if you go that route, and various other things retired folks say
they enjoy).

Just think of retirement funds this way; people are making sure they don't
have to eat cat food bought with social security checks during the waning
portion of their "brief window of autonomy", and they don't want to go for the
aforementioned whiskey-and-suicide route because most people don't actually
want to kill themselves.

~~~
LPTS
I don't want to spend all the good years of my life living exactly like a rat
doing whatever gymnastics get me enough pellets (dollars) to survive. I'd
rather say "fuck that" and do what I want.

It's not a lack of money that would make me kill myself (and I don't drink
alcohol, preferring drugs that enhance cognition). It's a lack of meaning. As
long as I can write books, papers on ideas that interest me, or work on my
patentable inventions, my life has meaning regardless of the money situation.
But, if I'm spending my time worrying if I have tucked away my pellets as good
as the neighbors, my life has no interest, and, at that point, why not get off
the ride instead of spinning the wheel for no good reason?

------
time_management
Question : Why have I heard of this guy? Really, why?

~~~
fallentimes
Sold grocery bags as a kid, sold a small computer company to make his early
millions, owns the Dallas Mavericks, flipped Broadcast.com to the boners at
Yahoo.com for billions, started HDNet, owns various movie production companies
and distribution channels, helped produce the movie _The Smartest Guys in the
Room_ (awesome movie about Enron), ran and sold a hedge fund, angel investor
in many many things, prominent blogger, and most recently made a godawful
awful trade for the unbelievably overrated Jason Kidd.

~~~
prakash
One tiny addition to your list, didn't re-sign Steve Nash.

~~~
fallentimes
Also of recent: didn't go after Gasol when he had the chance, overpaid for
Erick Dampier, paid the salaries of Devean George, Antoine Wright and Eddie
Jones (old version) even though they are the same player, traded one of the
best young PGs in the league (Devin Harris), overpaid for a mediocre center
(Diop), and most importantly, refuses (so far) to play up tempo basketball
even though the best players the Mavs have (Dirk, Howard, Terry, Bass, Kidd)
would all thrive in it. I think Cuban still has a bad taste in his mouth from
the run'n'gun Nellie era.

Can you tell I run a site that searches for Sports Tickets? :)

~~~
prakash
_Can you tell I run a site that searches for Sports Tickets? :)_

not really :-), if you have been following the Mavs from the time Cuban bought
it.

~~~
fallentimes
Haha I can provide a similar analysis for any NBA team - it's what I know
best.

