Mark cuban is one of the best known investors in the United States. It is likely that you know him from the hit television series Shark Thank. In this series he and other investors look for the most interesting and innovative projects on the market. Today we’re sharing some of his wisdom with you so that you can invest the way he does.
This business monster is a billionaire from various of his endeavors. He owns the Dallas Mavericks (a basketball team) and sold his first startup in 1990 for $6 million. He then sold his second business for $5.9 million in 1999. Since then, he has started or acquired several other businesses and invested in many more. His current net worth is estimated at around $4.2 billion. Here is just some of the advice this star entrepreneur has to offer.
1. Start by paying all debts
“The best investment you can make is to pay off your credit cards, to pay off any debt you have,” Cuban said in an interview with MarketWatch. “If you have a student loan with a 7 percent interest rate, if you pay that loan off, you’re getting 7 percent, that’s your immediate return, which is much safer than picking a stock or trying to pick real estate, or whatever.
2.Save your income for 6 months
Cuban told Vanity Fair that a person would have to try to save up to six months of income and keep it available. “If you don’t like your job at some point or you get fired or you have to move or something goes wrong, you’ll need at least six monthas of income,” he explained.
3. It’s okay to make risky investments, but it should only be 10 percent of all your investments.
What Mark Cuban admitted is that most billionaires who invest money did so by calculating the risks well. Therefore, investing in something completely risky is fine, as long as you limit it to only 10 percent of your total investments. “If you’re a real adventurer and you really want to throw the hail, you can take the 10 percent and put it in bitcoin or Ethereum, but if you do, you have to pretend you’ve already lost your money,” Cuban said in the same Vanity Fair video.
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4. Where to put my money?
In that same interview, Cuban mentioned what you should do with the rest of your money: Put it into the cheapest index fund linked to the S&P 500 you can find.
5.Make use of the discounts.
It is difficult to obtain a high rate of return in the current investment climate, so you might be better off, for example, buying two years’ worth of toothpaste if you can find it at a 50 percent discount.
“Saving 15 percent on $1,000 worth of items that you know you will spend absolutely no money on is a better return on your money than earning 15 percent in a year on a $1,000 investment because you don’t pay taxes on them,” Mark Cuban explained in a blog post.
6. Learn how to sell.
What Cuban mentions in this regard is that: “Everything in life is a constant sale, at all times we are or are being sold, but in the entrepreneurial world, a sale is not a sale, it is always about helping your customers with your products or services.
7. Empathize with the client.
In that same video, Mark Cuban explains that in order to sell, you have to understand how your client feels. Understand him at a level of depth that allows you to get along with him.
8. Soak up the world of technology.
As we told you at the beginning, Mark Cuban sold his first two startups for many millions of dollars. Do you know who he sold them to? To CompuServer and Yahoo! So it’s only natural that this investment giant is looking for you and him to start making friends with new technologies, because they represent a good business opportunity.
9. Ask yourself how you would design a solution if the current solution did not exist
For Cuban, 99% of the things that are done in business today, are being done in the same way that they have always been done. Many do not ask people what they want, successful entrepreneurs create a new product or service, and once they have created it, then they decide what to do with what they have just created.
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10. Create something of value
If you create something of value for your clients, they will receive it with open hands and therefore, you should not focus so much on making money, you should only focus on giving valuable solutions and solving problems. The money will come by itself.
11. Be Nice to people
Cuban claims that people hate dealing with unpleasant people, so it’s always easier to be nice than to be an annoying businessman. So watch out, being nice will open doors for you.
12. If you are not sure, do not invest
In his blog, Mark Cuban titled one of his articles “The best investment advice you’ll ever get”. There he urges you to know the risks of any investment and be prepared for the possibility of losing your money. If you have doubts, the best thing to do is not invest.
13. College is a great option.
Although a large number of investors believe that college is not a very good investment, Cuban differs from that. He has faith in low-cost professional education. He suggests that you enroll in a local or community college during your first few years of college education. While it’s great that you attend a prestigious university, he also doesn’t advocate going into debt to do so. If you can apply for a full scholarship or attend an option you can afford, the important thing is that you go to college.
14. Discipline your expenses
According to GoBankingRates, after college, Cuban moved into a house with five roommates, lived on macaroni and cheese and drove an older vehicle. Instead of investing in expensive possessions, he did so for himself and his future goals. Live below your means and reduce expenses to better contribute to your savings.
15. Your money is your money
In an interview with The Dallas Morning News, Cuban advised potential lottery winners to think twice before lending money to anyone. Don’t limit yourself when you can help others, but never give large amounts of money to anyone, be they family or friends.
Are you an aspiring entrepreneur? Check out my new book: Strictly Business: How to Crush it as a Young Entrepreneur.
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