Surprising Lessons from the Richest Man in Town
W.
Randall Jones
Worth
ome
of the richest people around did not depend on the stock
market (or an inheritance) to achieve their wealth. And often
what they did went against the common wisdom.
W.
Randall Jones, founder of Worth magazine,
tracked down the richest men and women (average net
worth: $3.5 billion) in 100 American cities and towns to
find out how they achieved their financial success, and to explore
what the rest of us can do in these difficult times to benefit from
their examples. Among the surprising lessons...
Don’t
set goals
The
conventional wisdom says that extensive career and business
planning are crucial, but the richest man in town is more likely to
believe that planning inhibits success. Most of these rich men and
women don’t plot a course that is more detailed than "get up each
morning and do better than the day before."
What’s
wrong with goals and plans? Too often, those who set them feel
obliged to stick with them even when changing circumstances render
the plans obsolete. Being ready to adapt to changing circumstances
is a better policy.
Example: Jim Oelschlager, the
richest man in Akron and founder of the investment company Oak
Associates, Ltd., says that the only business plan he ever had was
"answer the phone if it rang."
One
day, a manager at his employer at the time, Firestone, asked him to
manage its pension plan. This experience allowed him to create a
series of successful mutual funds later on.
Despite
the challenge of having multiple sclerosis, Oelschlager was able to
take advantage of the best opportunities that came his way even
when they were not what he expected. Over the years, Oak Associates
has profitably expanded -- and Oelschlager also started CyGem, an
information technology company, and Oak Air airline charters.
Oelschlager believes that if he had moved his company in the
direction he wanted to go rather than the direction that client
feedback led him, "we would have failed miserably."
Don’t
seek glamour
The
best types of businesses for wealth creation tend to be those not
generally considered very lucrative or glamorous.
Examples: James Haslam, the richest
man in Knoxville, Tennessee, and owner of Pilot Travel Centers,
LLC, made his money in truck stops... Bruce Halle, the richest man
in Scottsdale, Arizona, and founder of Discount Tire, made his by
selling car tires... David Green, the richest man in Oklahoma City
and founder of Hobby Lobby Creative Centers, became a billionaire
through an arts-and-crafts supply business.
The
trouble with sectors that are associated with glamour and extreme
wealth is that therealready are many very intelligent
people trying to make their fortunes there. Big money can be made
in Hollywood... in computer technology...in real estate -- but
those fields are so crowded with established players that the
person who makes that money probably won’t be you. It is better to
find a sector where others see less potential... but where you have
your greatest skills.
Example: Hartley Peavey, the richest
man in Meridian, Mississippi, and the founder of Peavey
Electronics, loved playing music but realized that there were so
many talented would-be musicians in the world that the odds were
stacked against his finding success as one. Peavey was very good at
building things, so he made his fortune by building instruments and
amplifiers rather than playing guitar, which he also still
enjoys.
Foster
relationships
in your off hours
With a
recession raging, how to spend off hours is the furthest thing from
most of our minds these days. We are too worried about our careers
to take much time away from business... and too worried about our
depleted savings to treat acquaintances to fancy dinners.
The
richest man in town knows that playing golf, tennis or poker...
attending fund-raisers and parties...and going out to dinner are
not just things to do for fun. Off-hour socializing is when
networks are formed with other local businesspeople and trust is
built with colleagues and potential clients.
Example: Dan Duncan, the chairman of
the energy company Enterprise Products Partners and the richest man
in Houston, says that socializing with other businesspeople is
vital because "I want them to call me first when they want to do a
deal."
Don’t
try to create WEALTH --
try to create value
Even
when the economy is weak, potential customers still have needs. And
they appreciate value, especially if they are spending far less
than before. If a business can serve those needs and offer value in
good times and bad, wealth should eventually follow.
The
richest man in town typically did not set out to become fabulously
wealthy. More often, he saw a problem that he could fix or a market
that was poorly served and decided that he had a better
solution.
Example: There were other antivirus
software programs on the market when John McAfee, the richest man
in Rodeo, New Mexico, and founder of McAfee Software, unveiled his
program in the 1980s. But while the other antivirus software
designers tried to sell their products and worried about illegal
copying, McAfee gave away his software for free so that it would
benefit as many computer users as possible. McAfee’s program soon
dominated the market, and he made his fortune by selling
upgrades.