Lewis Schiff: Why Some People Are Rich and Others Aren’t

Lewis Schiff: Why Some People Are Rich and Others Aren’t

By Dan Schawbel

To understand how some people become wildly successful in business and why others fall flat, I spoke to Lewis Schiff. Lewis is the author of the new book, Business Brilliant: Surprising Lessons from the Greatest Self-Made Business Icons. He is also the executive director of Inc. Business Owners Council, a membership organization for Inc. Magazine’s top entrepreneurs and owners of closely-held family businesses and maintains a blog about behavioral entrepreneurship on Inc.com. Schiff has also co-authored The Influence of Affluence: How The Rich Are Changing America and The Armchair Millionaire.
In this interview, Lewis talks about how the priorities of the middle class are different from the ultra-rich, his seven principles that all successful entrepreneurs follow, and the skills professionals need to focus on in order to succeed and more.

How are the priorities of the middle class different from the rich?

This is a great question that goes right to the heart of the matter. The middle class would prefer to remain in their “comfort zone” rather than prioritize wealth creation. For the self-made rich, following the steps that lead to wealth is more important than being comfortable.
A simple example: It’s a common myth that “you have to have money to make money.” Most of the 400 self-made wealthy I surveyed for Business Brilliant would prefer to have other people invest in their ideas. Why? First, it’s a good filter to see if others agree that the idea is worth pursuing; second, it helps the entrepreneur preserve their own capital. The middle class are less willing to ask other people for money because they fear being rejected or, if they find an investor, fear of letting that person (often a friend or family member) down. The self-made wealthy ignore this concern.

What are the seven principles practiced by the ultra-successful entrepreneurs?

Do what you love, but always follow the money. This is in contrast to what the middle class believe which is. Do what you love and the money will follow.

Save less, earn more. This is in contrast to what the middle class believe which is that you can save your way to wealth by cutting back on life’s luxuries. The self-made wealthy are too busy trying to earn more money to worry about saving their pennies.

Imitate, don’t innovate. The middle believe you need a big idea in order to become wealthy. The self-made wealthy know that it’s the excellent execution of ordinary ideas that really creates wealth in America.

Know-how is good, “know-who” is better. The middle class are much more likely to rely on skills learned in school while the self-made wealthy are more likely to rely on leveraging opportunities that can be found by serving groups of people who need each other but don’t know each other.

Win-Win is a sure way to lose. Self-made millionaires are masters at negotiating. The middle class don’t seem to appreciate the value that negotiating can create and they certainly don’t know how to do it well!

Spread the work, spread the wealth. The middle class seem to be overly committed to shoring up their weaknesses in order to be well-rounded in their work. The self-made wealthy tend to focus on being good at a few things and delegating everything else that they’re not good at.

Nothing succeeds like failure. Based on my research, the middle class tend to pull back just when they’re about to be successful. That’s because most success stories are preceded by business failures–often crushing failures. Quitting after a setback squanders the opportunity created by adversity and the self-made wealthy know that persevering in the face of adversity is the key to success!

What three skills should professionals focus on to stand out and achieve career success?

1. How to ask for more and how to negotiate better.
2. How to develop their strengths and delegate their weaknesses.
3. The importance of perseverance in the face of adversity.

Does selecting the right friends have an impact on your success? Why or why not?

Social contagion is real. If you spend time with people who smoke, you’ll probably smoke, too. If you hang out with people who exercise, you’re more likely to exercise, too. If you want to be more successful, you must spend more time with people who are more successful, as well. Identify a mentor inside or out of your office. Minimize your time with people who view work as a burden. Put yourself in situations where you are the least successful person in the room and soak up everything around you.

What are a few attributes you don’t need in order to be business brilliant?

First, be willing to accept that the way you’ve been doing things may no longer be sufficient to help you realize your goals of financial security and will probably leave you a long way from achieving true financial independence.

Second, be willing to put yourself in positions of vulnerability. The first time you try these business brilliant techniques, you may fail. That’s ok and to be expected.

If you are prepared to try those two behaviors on for a while, you have what it takes to pursue your own business brilliance!

Dan Schawbel is the author of the upcoming book, Promote Yourself: The New Rules For Career Success (St. Martin’s Press, Sept 3rd). Listen to his Promote Yourself Podcast on iTunes for more interviews and career advice.

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