Finding Financial Freedom in Robert Kiyosaki’s B-Quadrant
I’ve been reflecting a lot lately on my own journey in the network marketing industry. It began over ten years ago as I was looking for more freedom in my life that my corporate job simply wasn’t providing. I read the following quote in a book by international best-selling financial author Robert Kiyosaki, who was talking about how the average person can move over into what he calls the “B Quadrant” to attain more financial independence (Note: if you’re not familiar with Kiyosaki’s concept of the cashflow quadrant, watch the short video at the end of this article):
“Pick a good network marketing company and work hard at it for at least five years.” — Robert Kiyosaki
That advice has absolutely changed my life. Today, my wife and I are traveling the world and doing what we want, when we want, without having to worry about the time and financial limitations that hold most people back.
But the journey hasn’t always been easy. And as I reflect back on this quote, there are really three core parts of it that deserve elaboration. I’m going to break them down and show you how you, too, can have success in network marketing. I hope you take these words to heart and that they empower you to transform your own life into one where you can truly thrive!
“Pick a GOOD network marketing company….”
But not all network marketing companies are created equal. Some put you in a better position to succeed, while others doom you to failure almost from the start. Having closely analyzed over 70 different network marketing companies before (and after!) choosing USANA Health Sciences, here’s what I’ve found to be the five key areas you need to scrutinize when evaluating a company to decide whether or not it meets Kiyosaki’s “good” criteria and is the right fit for you:
Products: Are they consumable? Residual income comes from repeat orders. Sure, you can sell jewelry, but how often does someone really need to buy more jewelry? And are the products a luxury (e.g. travel) or a necessity (e.g. nutrition)? You want to make sure people will still need your product in good times as well as bad. And of course, make sure the products have a unique selling point and something proprietary that truly sets them apart in the marketplace.
Longevity: Most network marketing companies fail within the first few years. If you want to build a true legacy business that will benefit your kids and grandkids, make sure you’re aligning yourself with a company built for the long-haul. People get excited about start-ups, but remember that there’s no such thing as “get rich quick.” You still have to put in the work whether you’re the first one in or the millionth one in. A good rule of thumb is a company that’s at least five years old, preferably 10 or more.
Compensation Plan: Is the compensation plan fair for the average person? Most traditional multi-level compensation plans reward associates who can sponsor a lot of people (sponsor monsters, as we call them). But the average person will only sponsor 2-4 people in their first six months. Binary compensation plans are ideal for that reason — they reward teamwork instead of recruiting mastery. My litmus test was, “Could my mother-in-law, who doesn’t have a college degree and isn’t a good salesperson, have success in this comp plan?”
Timing: Is the company growing? How many consecutive years in a row has it been growing? And are industry trends in alignment with your product? You want to be at the front of the trends, not chasing them. You also want to make sure the team you’re joining is growing. But in terms of getting started, my motto is: “There’s no time like the present!”
Support System: Ultimately your success in any endeavor comes down to you. Nobody is going to build your business for you, and despite what anybody tells you, your sponsor isn’t going to make you rich. BUT, there’s no doubt that a good support system can help. There are two groups to look at: Your company’s management team and the team of associates you’ll be joining. The management team will be driving the corporate ship, so you need to make sure they’re people of integrity and have a strong vision for where the company is going. You also want to make sure that your sponsor and the team of people you’ll be working with know what they’re doing and provide training and tools to help you succeed.
“…work HARD at it….”
I always tell people: “You’re going to work hard at something for the next 3-5 years anyway, but will you be substantially better off at the end of those five years if you keep doing what you’re doing?”
For most people, the answer is “no.” Sure, they might have gotten a few raises along the way and put a few more dollars into their 401K. But they almost certainly won’t be able to retire. They’ll still have to wake up on the first day of year 6 and keep going to work if they want to keep getting paid.
Not so with USANA. If you do it right, if you work hard at the business and build a solid customer base and a team of associates doing the same, there’s every reason to expect you could find yourself in a situation where you no longer have to work, where you can live on the fruits of your past labor.
But let me actually modify Robert Kiyosaki’s quote a little bit. From my experience, it’s not really about working hard. I mean, digging ditches is hard. Teaching elementary school is hard. Going off to war is hard.
Network marketing isn’t hard in the same way those other professions are hard. Rather, what I’ve seen is that success in network marketing takes consistent and efficient effort. You need to do the core business-building activities of approaching, presenting, following up, and teaching your team to do the same (“duplicating”), and you need to do them week after week after week until you’ve attained whatever level of success you’re shooting for. You can’t make a bunch of approaches and give a handful of presentations right after your company’s convention while you’re excited, and then proceed to do nothing for a couple months during the holidays, then ramp things back up for a month or two in the new year, then take the summer off.
It doesn’t work that way. Do you think Bill Gates operates that way? Do you think Warren Buffet operates that way? Do you think any successful business owner takes such a cyclical approach to his business? Of course not. And neither should you.
“…for at least five years.”
Malcolm Gladwell famously wrote that it takes 10,000 hours to become an expert at something. That’s a lot of hours. In fact, assuming 8 hours a day, it would take you 3.5 years to become an expert at, say, network marketing! But you may only be doing your network marketing business part-time in the beginning, so that’s why Robert Kiyosaki conservatively says that you should expect to devote at least five years to building your business.
And that should be your goal — to become an expert. Have you ever noticed that some people can easily and persuasively introduce their product or business to a complete stranger, create curiosity, schedule a presentation, sign them into their business, and do it all without coming across as pushy or sales-y? And yet other people steamroll their friends and family and turn off everyone in their path, and have absolutely no success in their business whatsoever?
What’s the difference?
Skills. The first person has honed a set of skills that breed success in network marketing. The second person simply hasn’t. The skills can be learned and honed, but it takes time.
So give it the necessary time.
I was laughing this week with one of our Thrive Team members, Sean Hudelson of Denver, CO, about one of his friends we had joined Sean’s team in USANA a few years ago. He’s a doctor in the Philippines, and he loved the USANA products and thought he could build a business around them with his sphere of influence. After signing up, he promptly did…nothing! He wouldn’t attend our trainings. He wouldn’t schedule any presentations for us. He got a few family members on the USANA products, but that was about it. Come to find out, he’s just signed on with a different network marketing company selling coffee for weight loss. Go figure! In explaining to Sean why he jumped ship, he said, “Well, I tried building my USANA business but it just didn’t work.” Ha! Not only did he violate the “work hard” principle we just discussed, he certainly broke this “for at least five years” part of Kiyosaki’s counsel as well! My guess is that he’ll move on to another company in another year or two.
How can you claim something didn’t work for you if you didn’t give it time to work?
The reality is that the type of income you earn in network marketing is exponential in nature, as you see in this graph. It takes time to build. You need to find your first few customers and team members and start training them. In the beginning, your paychecks won’t be very big because you don’t have that many people in your organization using the products. But eventually it starts to build. Two people become four. Four become eight. Eight become 16. 16 become 32, and the next thing you know you have some critical mass. It’s like a snowball rolling downhill at that point, picking up steam, and the next thing you know you have a sizable business and substantial paychecks.
In fact, at some point, your network marketing income (the red line) will actually meet — and then exceed! — your linear corporate income (the blue line)! That’s a fun day. That’s when you have the freedom of choice in your life we’ve been talking about.
But here’s the question: Will you stay committed to building your network marketing business for as long is it takes for those two income lines to cross? You see that on average in USANA it takes about 3.5 years (for me, it took about 15 months). But what if it took you longer? What if it takes the full five years Robert Kiyosaki advises? What if it takes even longer than that for you?
I guarantee you that the freedom that comes with a successful network marketing business is worth it, not matter how long it takes. I’ve seen it first-hand. I’m living it right now. But you ultimately have to answer that question for yourself. Are you committed?
For more information or to join our team, contact us today!