- So, let's talk about the
only three money principles that you must know, need
to know to get rich and? - Stay rich. - The name of the game is
not to get rich but to? - Stay rich. - There are a number of principles. You know, when I look through
my own private journal, all the mistakes that I've made. I have about roughly
probably 29, 30 of them. But I picked the three that I
believe are the most critical, which is what I'm gonna
share with you today. - The king of high ticket sales, world's highest paid
consultant, media celebrity, multimillionaire entrepreneur,
acclaimed TEDx speaker, international bestselling author, Dan Lok. - So money principle number one and that is what I call
mastering the wealth triangle. Mastering what? The Wealth Triangle. For my inner circle members, I've been hammering this
concept on umpteen million times but this might be new for you. It's very simply but incredibly profound. You'll see why in a moment. This is not some theory
or some philosophy. You will not get this from a book. I pioneered this, I created this. Basically it's the essence
of my 15-plus years of financial business experience, experience gained down and
dirty, in the trenches, roll up my sleeves in the world. This will give you the who,
what, why, and when of money. Here's how it works. The wealth triangle has three pieces. How many? - Three. - The first piece is what
I call high-income skills. What is it? - High-income skills. - High-income skills. How I define high-income skills is a skill that has the potential to
make you over $100,000 a year. $100,000 or sometimes 10 grand a month, however you want to use
it, but $100,000 a year, has the potential to
make you $100,000 a year or more per year. In this case, you are trading
your hours for dollars or you're trading your
hours for high dollars. You're turning your skills,
your experience, your talents, and you're delivering value to marketplace in exchange of money. So, you are selling your time, but for good money. High-income skills. Number of skills, I'd say my amenities, you have Hassan, hard-copy writing, you could be consulting, you could be doing
social media management. I have a friend of mine who is actually a ballroom dance instructor and he makes over a 100K a year, as a ballroom dance instructor. That's considered a
high income skill, too. So whatever high income skill
you might be thinking of. Now why is that important? With your high income
skill it gives income and it gives you comfort. It provides that stability
in your wealth triangle. In your wealth triangle. Now the second piece of the puzzle, the second step is what
I call scalable business. What is it? - Scalable business. - Now, what is a scalable
business? Tell me. - Something that you can-- - Something that you can? - Repeat. - Repeat. Something that you could grow. Something that you could grow without a lot of infrastructure. Is restaurant a scalable business? - No. - No, because every time you
want to open a second location, I've got to sign a long lease, I've got to put in a lot of money, I've got to renovate a place, I've got to hire a lot of people. Yes? (attendee speaks inaudibly) - Yeah, break even funnel, maybe, maybe it's an internet type business, it could be an eCommerce business, but something you could grow without a lot of infrastructure, or without hiring a lot of people without a lot of overhead. Now why is a scalable business important? Because your high income skills provide you with income. Yes? - Yes. - Your scalable business
provides you with cashflow. It provides you with cashflow. That was the second step. Now we can grow it. Third component, that's what
I call high return investment. High return what? - Investment. Now how do I define
high return investment? I define high return
investment as an investment that will provide you
with 10% annual return, year in and year out. A minimum of 10%. Minimum 10% year in, not the first year, but year in and year out I consider that a high return investment. In some cases it could be more. Now, high return investment
doesn't provide you with income, but it builds your net worth. What is it? - Your net worth. - Your net worth. Your net worth. Here's the triangle and
here's why it's profound, so I'll go into a little bit of detail. High income skills you make your money, high income skills is
you making your money. How many of you got that? Yes? You make your money. This scalable business
is now people or system making your money. Yes? Hello? Yes.
- Yes. High return investments now is
money making your money. Yes? - Yes. So, three very, very different things. Now here is the challenge. This will solve all your-- You've asked me what should I do? What should I invest? A lot of people sometimes come up to me, what business should I start? This will answer all the questions today. Question number one. Dan, I am just getting started. What business should I start? My reply is none. Don't start a business
when you have no clue and no business acumen. Because what is the very
first step you should do? Hello? - Develop a high income skill. - Develop a high income skill first. Make that 10K a month first. Trade hours for dollars,
there's nothing wrong with that. Trade hours for high dollars, because this gives us stability. How most entrepreneurs-- they don't have high income skills, they just jump into you. They think it's a scalable business. They sink their life savings into it. You see it a lot on
Dragon's Den or Shark Tank. I don't know anything about business, I came up with this amazing idea, I mortgaged my house, I put up everything I got, I borrowed from my family and friends and I have now 2 000
board games in my garage. Dragon, please give me some money. And the Dragon says? No. (attendee speaks inaudibly) Which is a joint venture broker. (attendee speaks inaudibly) Very good, very good. So what happens is, in business, same thing with my own career, and over now so many years. Do you have ups and
downs in business? Yes? - Yes. - What I said, your cashflow pattern. Some year you're good,
some year you're not good. But very early on, since I was back in my
early 20s as a copywriter and then moving to consulting
and coaching and speaking. My high income skills. Every year I strive to
increase my earning ability, with my high income skills. So although I made some bad investments, I've done like 10 tech
ventures as an angel investor, lost money on all 10. That tells me I'm not a very
good tech investor, right? I thought I'd go into the marketing, but shit, right? So I learned my lesson there, like you can't know why. All 10 lost money. And I'll share some
lessons with you from that. But all these years my high
income skills is very, very-- every year is very consistent. That gives me the base. So I make loads of money
from my investment, but I can always count
on who making me money? - You. - Myself making me money,
so I never, ever stop. As I build my scalable business, my income skills is making me money. When I get on stage,
I'm speaking I get 15K, I'm making money. There's nothing wrong with that. Next on a consulting gig I make a 100K. There's nothing wrong with that. I'll take the money, because it gives me stability. I know I'm trading hours
for dollars, that's okay, because I want to have
the wealth triangle. Yes? Now, people ask me what
business should I start? I say-- None. The first thing you gotta do is? High income skills,
right? Question, Nathan? - Can your high income skills also be your scalable business at the same time? - Possible. It's possible,
very good question. Second thing, now I have
my high income skills, let's say I'm making a 100K a year. What happens is over the years,
here's what I've learned. Less than six percent
of the population makes over a $100,000 a year. Less than six percent. When you're making a
100K, your income bracket, you're at the top six percent. Less than one percent of the population makes over $325,000 a year in income. What happens is, somehow,
I don't know what it is, as a person, as an entrepreneur, I notice whenever someone gets
over that 10K a month mark, something change about them. Suddenly they can see, well, I am now the top
income earner in society. It's very rare I see someone
who makes 10K a month, drop back to making 2K a month. Because the new 10K a month, talking about psychology, becomes a new comfort zone. It becomes a new comfort zone. I don't know how it works, I
don't even care how it works, but I know it works. Whenever I see someone
get through the 10K, they may stay in 10K for a long time, but it's rare, very rare 10K suddenly-- Because whenever the income drops, they do whatever they could
to get back to that 10K. Which Adam has been through that, right? You dropped, it's like, I
gotta do whatever I could to get back to that 10K. That's one thing. When you have a high income skill it tells me a number of things about you. When you have a high
income skill it tells me you're probably pretty good with people. And you probably have a
pretty good work ethics. And your probably easy at selling and you're delivering quite a bit of value to the market place. Does that make sense? Otherwise you wouldn't be making the 10K. So it tells me a lot about you. When you have these
qualities, you take all this when you transition
into a scalable business it makes a lot more sense,
you lower your risk. Versus, I don't know
anything about business, I hate my job, I've
been working corporate, In 20 years I'm gonna jump into business, that's why people fail. Because they don't have
the high income skills. Let me give you an example. Let's say I have been doing social media, I'm a social media manager, and I've been doing eCommerce,
I'm working with clients, I'm helping them with social media, driving traffic their
website, all that stuff. And now I'm making 10K
a month. You with me? Now suddenly, okay, I
see an opportunity here, maybe there's a product I can sell online? I can use social media,
I can use Facebook, I drive traffic to it. By the time I start that,
I already have my skill. I already have that basic skill. I take my success, here's
the concept, write it down, stacking on your success. Not from scratch, something
that's successful. I've got what it takes. Now I take what I know, now
I just do it for myself, in my spare time. You with me? Working for myself in my spare time. And this will grow. And this will grow. So then, when should you
invest in something else? When your scalable business
makes so much money you don't know what to do to it. That's when you invest. You don't invest when you are still, ah man, I'm just struggling,
I'm making a few thousand. Here's what happens, people, have a job making $2,500 a month. You see infomercial, some guy talking about buy
real estate, no money down. Oh shit, that's awesome. Maybe that will help me get off my job, get out of my rat race. Let me go buy the course for $69.95. Two easy payments. I buy that, I learn that
I'm gonna buy real estate, and they buy a couple
pieces of real estate, suddenly, tenant moves out,
the toilet broke, now what? Their fucked. (laughter) They don't even have enough
money to fix the toilet. Now they'll be going in to foreclosure. And they lost everything and they say now, real estate doesn't work. That's why it doesn't work. Because you don't have the first piece. You don't have that first piece. You got to get to that first piece first, and here's what's very, very interesting. I know a lot of people who do very well, they don't even have a scalable business. You can be very wealthy
with high income skills and you make your money and then you put it into
high return investments, you could do very, very well. I don't believe, I truly don't believe everybody should have a scalable business. It's not for everyone, not
everyone is cut out for that. And you don't have to
be that to do very well. Like a friend of mine
who is a photographer. Just a photographer. In Vancouver, very high end, I mean he take photos for Jim Pattison's He has a whole team. He charges a lot of money,
makes six figure income a year, and he started investing
in real estate 20, 20 some what years ago. Today he has a portfolio
of about 250 units that's worth about 20, 25 million dollars. High income skills, put money aside, invest long term, 20, 30 years. He's got a huge portfolio, yes? Doesn't have a scalable business-- Yes, Nathan? - So is a scalable business only a product or is it that you have employees and they're making money for you? - It's not the business type,
it's how you do your business. So let's say if you are doing
SEO as a sole proprietor, not as by yourself, let's say
you're making 10K a month, that's high income skill, right? But suddenly, let's say, you know what? I'm going to transition that into, I'm gonna do reputation
management for a company. I'm gonna take on
different type of clients. So you build your business
model where you have a team that you're not doing so much of the work. You're leveraging the
team system, technology, suddenly, it becomes a scalable business. So it could be that, hey
you know, if you want me, it's gonna be five grand
a month to do SEO. Me. But if you want my team
it's two grand a month. So now you're both going on. Does that make sense? So it all depends on, not-- It's not what you do,
it's how you do it. Yes? - So do your high income skills
have to be your job? Or-- - Did I say high income job? (laughter) The difference is, a job, you're dictated by somebody else to say
how much you're worth. A skill you're dictated
to by the market place, and you can increase that. So one of your goals should
be increasing that every year. I don't care if it's five percent, I don't care if it's 10 percent, I'm making a 100K last year, this year I want to make a 110K, I wanna make 120K. Keep increasing that,
increasing your value, yes? Now let me give you one more example. Sometimes people say to me and say, Well you know, Dan, let
me give you an example, let me say you're in marketing, it's not a scalable business. I'm right, now we're marketing. You know some people like
it, some don't like it, it's a scalable business. The challenge is, 99% of
people don't make money in network marketing, because they are using that as an escape. Please write this down. You can't escape from something, you've got to escape to something. You can't escape from your job and say I'll jump into something. Or maybe that will help
me get rid of my job. It's not like that, because they don't have the
skills in the first place. And they jump to something and that's why, Oh, it's so hard, I talked
to my friends and family, I get rejection, I'm done
and this MLM shit sucks. It has nothing to do with that. Other people are making a lot of money with MLM marketing, yes? - Other people making no
money with MLM marketing. Other people make a lot
of money with real estate. Other people making no
money with real estate. It's the same, there's
nothing to do with that. There's nothing do to with that. So, with this, now here's what happens, when your business doing very well. You're making, generating a
lot of cash, a lot of cash. Now you put into your
high return investments, so you make it, you grow it, now you kind of park it here
as a high return investment. You put it in there, you don't touch it. You just let it grow. It grows your net worth, it grows your net worth. And every month you look
at your net worth statement and it's getting better and
better and better and better. That's stability. Income, cashflow, net
worth, here is the thing. Here's the thing. When you skip and people
start jumping to that and you skip that-- With this triangle, now
you know where you stand and what you should focus on. Actually, you know what? Let me give you two minutes. How long? - Two minutes. - To discuss around the table,
what you've learned so far. Okay? Go. Let's take a little deeper here. Let's take a little bit deeper. Now why is it important you
have the high income skill, before your scalable business? Because here's what happens. Let's say you start an eCommerce business and it's growing and
you're acquiring customers and your driving traffic
and it's doing well. And now you're like, you know what? It's good. I can scale this thing. My question is where
the fuck do you come up with the money to scale it? Because all your money
is put in the business, the marketing, the inventory. You have a model that works, you have no money to scale it. Now at this point can you
bring in an outside investor? You could give them
percentages of your equity and all that stuff, you could. But when you have your
scalable business first, now you have money to scale. You know my bill is taken care of. It's okay, I've got money. Now I can have my business, probably investing all your
profit back in to the business. See, some people only
have a scalable business, they want it to grow, but
they also need to eat. So they take profit out. Pays for the day to day, and
that slows the growth down. Their not growing as fast as they want, versus my income skills
are how I'm making money. My business, just let it run.
Let it grow. Makes sense? So, it very much depends on-- So people ask me, well Dan,
what should I invest in? It's very simple. If you're at the stage
of high income skills, what should you invest in? - Yourself. - Yourself. You better
be fuck that 10% shit, you better be investing
30-40% of your money into upgrading your skills, maybe, it depends on what you need, maybe it's personal development, get your head screwed on straight, right? Let's fix that. What other mindset, what limiting belief, maybe you need to go through that. Go to Tony Robbins, go
through that shit, right? Walk on fire, go through that shit. I went through that shit, it's okay. Once you get through that
shit, you have the mindset, and now you know what, I need some skills. Let me read that book,
let me hire the coach, let me go to that workshop, let me do whatever it
takes to upgrade my skills. Work on that, a lot. Now when you have a scalable business. When you have a scalable business, what should you invest in? Team, what if you have a
business> I can tell you. Very simple. The highest return
you get from your business is when you invest in marketing. The best return you'll get is marketing. What kind of investment
you could put in a dollar and if you have a scalable business and it's converting and it's working well, can you come up with
two, three, five dollars? Just 2-300% return? It's criminal in the stock market, but in this business it is common. You spend a little bit of money, maybe even $500 in marketing you get a 10 grand sale. Is it possible? - Yes. - It's that kind of return. So why would you put it
into some mutual fund, that getting eight percent. It makes no sense. And who has more control? You have more control over your business or some mutual fund? So it very simple, if you have
a scalable business state, put most of your money, take your profit, put
it into your business. Marketing, hiring better people, teams. Just grow the shit out of it. Just grow. Let it grow, let it rise and at the same time, work
on yourself, your skills. That's why people come to me and say, Oh, I've got 10 grand to invest in. What should I do? I say go to a fucking seminar. (laughter) Improve your skills. It's
the fact that you're asking that you don't know what
to do with the 10 grand, tells me you don't know what to invest in. And you probably don't
have high income skills. It's the worst thing you want to do is, oh, I'll buy this stock or-- it's not about that. I'm not here to give a stock tip or buy that or what. It doesn't matter. I'll go through the level of investors, it's those investors that
don't know what they're doing that's why they jump from
one thing to another. Here their doing day trading and they're doing something else. Yes, Nathan? (Nathan speaking off mic) - I know, I'm in 90%. I lost all my money. (laughter) I know. I think it's like 90%. Like I said, out of 10? Now even two makes money. All 10 lost money, all right? (attendee speaks off microphone) - Because you could. It's the easiest when you have no skill, that growth is incredible. When you have no skill,
you learn a good skill, let's say you are-- How many of you are in sales? Every fucking hand should go up. (laughter) How many of you are in sales? Okay, we're all in sales. Let's say you're closing
10% in one out of 10. You learn some sales techniques, you get some sales training and suddenly you're
closing two out of ten. You sell 10%, you close 20%. You just doubled your income. How good is that? It might take you an hour, it might take you just watch one video, it might take you one day, who knows? But is that a good return? - Yes. - You cannot get that kind of return from any other investment. That's why you keep
learning, it's like people. I'm amazed that people
will spend the money on the big plasma TV. I love my TV, don't get me wrong. They spend stuff on that and yet, Oh, yeah, I gotta go to this workshop, I spent a thousand bucks and oh, I don't have the money. It's unbelievable. Yes? - Can I make a comment? - Please. - So I love what you said about you can grow from high income skills to merge your investment and still be .... Because in my line of work I see, like CEOs or founders they try
to build a scalable business, but they're actually not meant to do that, because they don't have
the leadership skills and so, I really like that. It's the first time I ever heard of .... I always thought you had to-- - You got a business. - You had to do the
five figure, six figures five figure income or six
figures and then scale it and then you invest,
you make a stair step? But not everyone is meant to
be a business owner, I realize. - You don't have to be a big
business owner to do well. Like what happens is, we
see these entrepreneurs on magazines, right? And read the article and oh,
that guy sold his company for 50 million dollars, that guy sold his company
for 100 million dollars. You never see the guy, oh, that guy just lost
a 100 million dollars. (laughter) He's not on the cover of Inc. So you see one guy that made it, you don't see the 10,000 that died. I'm saying, most people die, but it's not very entertaining
to talk about it, right? Yes? - I think Elon Musk's story
is really interesting. He built this company, sold
it for millions of dollars, had a vision, started two
companies, almost lost, or he lost all his
money and he was in debt and then he barely-- - He was close, days
form bankruptcy, right? - Yeah. - But he raised the money. - -- got together and he's
one of the smartest people on the planet. - Yeah, and now he's sold
declomycin like a tech-- he's like the next Tea shop. - No, Elon Musk. He's got the Tesla-- - You know that Tesla? (group talks) You don't have a TV? It's not a bad thing. It's not a bad thing. So does that make sense? Yes? - Yes. - Okay. Let's keep going. Warren Buffet said investing
in yourself is the best thing that you can do, anything that
improves your own talents. Nobody can tax it or
take it away from you. You can run up huge deficits and the dollar can become worth far less. You can have all kinds of things happen, but if you've got talent, yourself, maximize is a key word, maximize your talent, you've
got a tremendous asset that can return 10 fold. That's from Buffet. That is from Buffet. That's why I never, never, over the years, stop improving my high income skills. It was six figure and then seven figure, I never, doesn't matter how
good my business is doing, how great my investments are doing, I'm saying, no, I've got
to work on my skills. Because I don't know, I don't know what is going to happen. Yes? - What is the next skill
you are developing? - The next skill I am developing? Okay, very good question. So, I'll take you through my career, because it gives you a clear picture. The very first high income skill that I developed is copywriting. Which is how to write ads. How to put words in print to sell. And from copywriting I noticed I wasn't getting client, because nobody was buying and I was trying to get client, so I learned sales, how
to sell on the phone. From sales, then I learned
how to do marketing. I was doing marketing with
people and from marketing, copywriting is you're
working with clients, I noticed they don't
just want you to write, craft the words or headline, they kind of need some marketing strategy. Well, how I'm gonna use this stuff? So, evolve, transitioning into marketing, consulting, coaching type of work. From there I evolve into speaking. As you're asking, well, how do
you do some of these things? As a speaker you get paid
and that platform is selling. Which is very different. It's selling from platform,
you're making money, right? From there I also
transition into deal making, which is kind of what you do now, joint venture and deal making. Brokering So these skills I have developed, honed, and still honing over the years, and then managing my money and then investing as well, right? So, you see, over the years,
I have this treasure chest, all these tools on my tool belt, that I can call on
anytime and I can do it, I can make money with it. Does that make sense? At first you might just have one, but eventually you might
have more than one, you might have two or three. That's a whole bunch, and then you might merge them together, that's a possibility as well. So I never stop, I never, never stop. Makes sense? Okay, let's keep going, So most common investing questions I get, Dan I got 10K, what should I invest in? I already answered that. Dan, what do you invest in? Doesn't matter. Because it all depends
on what I invest in, doesn't mean what you should invest in. If I invest in oil and gold does it mean you should
invest in oil and gold? Hell no. It all depends on where you are at the wealth triangle, right? So get a high income
skill, invest in yourself, get training, upper your skills. Should I pay of my debt first
or should I invest first? I'm gonna get to that. Should I pay off my debt first
or should I invest first? It's interesting cartoon. Sure, two percent may not seem like a lot, but it's compound. If you invest a thousand dollars now, in just 10 short years, you have, let's see, $1219. Okay, so compound interest
isn't some magical force. Yeah, I'm just gonna
try to make more money. So as you improve your skill sets, you have more income coming in, you can scale your business faster or maybe just put more
money into investments. Put more money into investmen Conventional wisdom
teaches you how to get rich on your current income, here's what I believe and
I'll show you the numbers. If you can boost your
income to a 120,000 a year, 10K a month, you should be
able to create a million dollar net worth, not counting your house or car, in seven to 15 years, assuming you keep your expenses in check. Key word, assuming you keep
your expenses in check. So you can get to that 10K a month, even you don't never, ever,
ever have a scalable business, if you keep your expenses in check, you can get to that
million dollar net worth in seven to 15 years. It depends on what you do. Yes? Okay. Hi, this is Dan Lok. Welcome to Dan Lok TV. I want you to subscribe
to my YouTube channel. Now you might ask, why should I? Every week, I'll post two new videos, all focusing on helping you
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