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IV. Business Entrepreneur Thoughts
It's All in the Numbers
For all you true entrepreneurs, what I'm about to tell you comes as no surprise. Wealth can be generated by selling a $10 item, even a 5-cent item. It's true! Create a situation where 1,000 people will pay you $10 per month for a product or a service and you have a very nice steady income of $10,000 per month. Find just 10 people that need a product or service for $1,000 per month and you generate the same income.
I've always heard the story, but haven't confirmed it, that one of Atlanta's multi-millionaires got his wealth in such a way. The story goes that he developed the code that banks still use to manage their ATM machines that you see at every bank today. In the late 70's and early 80's this was a new concept and quite a few people thought that it would never go over with the public. Those same people undoubtedly are now looking for gas stations that have full service. Remember those days ?
At any rate, the story goes that this guy decided to take a commission payment of a penny on every transaction utilizing his software for 20 years rather than taking a contract fee for his time. It was a high risk with so much uncertainty of the technology at the time but he apparently knew something. If the story is true, he now lives in a home worth $35 million or more.
The point is that if you find the right product or service that has lots of appeal and repeat business, you don't have to charge much as long as it does not cost a lot to provide it.
I'll expect my 5% commission on all new startups as a result of reading this story.
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