What it Means to Hustle and Grind
If you’ve ever watched ABC’s Shark Tank, you’ll often hear Mark Cuban or Daymond John talk about wanting to work with entrepreneurs who know how to hustle, entrepreneurs willing to grind it out to make their dreams a reality. If it sounds like it’s a lot of work - It is!
One of the pillars of financial independence is generating stable, multiple streams of income. If you’re married and your spouse works, you can say your household generates two streams of income. Whether your married or not, we think the ideal goal is to have three or more streams of income. This is where the hustle and grind comes in.
If you’re a thinker like me, figuring out your side hustle can be a daunting task. In fact, it may take years. You may have went to college and work a ten hour corporate job where you simply don’t have a lot of energy or time to generate a side hustle. So you look for so called easy side gigs. The problem is that there really is no such thing as an easy side gig. I’ve been in real estate for years and I used to work with an agent that did real estate full time while also driving for UBER and Lyft. On his way back from house showings he would turn on his app and see if he could get any fares. He could also make conversation and sell his real estate services in the car. This was a hard way to make an extra $20-$30 here and there. I don’t remember if he ever got a buyer or seller from doing this. And remember, with this type of side gig you are putting wear and tear on your assets (i.e. your car). You are only paid for your time. If you don’t have time to work or you’re spending time sick in bed, you don’t get paid for driving.
On the other end of the spectrum, you may try to launch a full fledged business, buy into a franchise, or sell products out of your home. This is equally hard, because with so much competition and marketing noise out there, you have to work twice as hard to get your business noticed and actually generate a regular revenue stream. If you are already struggling to pay bills and save, starting a business puts you further in debt with all the startup costs you will incur. Even simple things like business cards, a website, and flyers cost some money.
The Worst Mistake
I’ve been guilty of committing the worst mistake - trying to launch a new business with a product or service that is unknown. I’ve always admired entrepreneurs that are great thinkers, able to create an entirely new category that either no one thought of, or had the guts to reinvent an existing category like UBER has done for taxi service. In my naivete, I thought I was smart enough to create such a business in my part-time with virtually no capital. Even more embarrassing is that I tried this several times over many years. I created a web-based note taking app that also included a reminder service well before Evernote was popular. Why did it fail? Constantly updating the software, adding new features, and no time or money to market it, just sunk me. In another example I created an online learning platform that could be used by middle schools to teach and test digital skills. I thought it could also be used by libraries that had computer literacy classes. Why did this fail? Schools have very tight budgets and most software is purchased at the district level. Working a full-time job during the day meant no time to visit school administrators and tell them about my product. All these businesses take marketing dollars, lots of time, and lots of education before you even see the first check.
There is a curve that needs to be climbed to convince people why they need xyz product or service. I remember one of my coworkers who graduated from Harvard telling me he had a business he had been running for a few years and was looking to expand it. I was expecting to hear a great elevator pitch and a reason to invest. Instead it was an online business selling dog collars. Why? He said it started making money from day one because people knew what the product did, there was a need for it, and he didn’t have to waste time creating a grand plan to sell the idea. Meanwhile I was on my third or fourth failed business. Today that same guy is now a CFO at a biotech company and I’m sure his little website still makes enough money to pay for gas, eating out regularly, and the cable bill.
So What’s The Lesson?
Hustle and grinding are inevitable if you want to build real wealth and don’t want to take the full frugal approach to financial independence. But the lesson is to be smart about the type of hustle and grind you choose to do.
If you’re healthy, have lots of free time, and drive a Toyota Prius, then maybe Uber will work really well for you. Especially, if you’re taking all the cash from that side gig and investing it in stocks or real estate. Uber drivers in Vegas and other hot spots tend to do really well.
If you work twelve hour days at a law firm, then trying to start a brand new company which requires your time during normal business hours may not be the best choice.
How to Hustle and Grind Smartly
Don’t just hustle and grind to look busy and make yourself think you’re doing something. At the end of the day you need to make money and it can’t kill you, your car, or your family life in the process.
Most important, stay positive. You’re doing this for a higher reason.
Welcome to StepChange (StpChg). A blog about personal finance, small business, and investing.