Leverage: The Secret of Unstoppable Success

Leverage can be explained in many different ways, but let's keep it simple  . . .

Leverage is the art of using other people’s resources to reach your goals.

Here are few ways to use leverage that have been mentioned on this blog over the last few months.

You can use leverage to buy a business. Richard Parker, our Professor and America’s leading expert on buying businesses, explains that it is possible to buy a business with no money down by offering to partner with its seller. You become a partner in the business for a pre-negotiated period of time while the money you make becomes the down payment on your purchase. In a year or two, you own the business without spending a cent of your own. Some people call that sweat equity, and it is. But it is also a great example of leverage at work.

You can use leverage to get ahead in real estate - fast. Gary Eldred, our Professor of Real Estate, describes a man who, with no money down, negotiated his way to a great start as a developer. He went to a wealthy investor and offered to handle all the details of locating, renovating and selling properties - for a share of the profits that each property brought when it sold. After doing that several times for the investor, he had made enough money to start out on his own as a developer, and he never looked back. And remember, he started with nothing. In real estate, leverage is everywhere. If you arrange owner financing when acquiring a property, that is leverage. When you sell a property and offer the buyers a rent-to-buy agreement, you are letting them use leverage to your benefit.

You can use social leverage too. Randal Pinkett, the Apprentice winner who has recently joined our faculty, wrote in this blog about “Social Capital,” the art of allowing influential, well-connected people help you. They will, through their contacts, information and intelligence. If you stop to think about all the people you know, you will discover many people who are positioned to help you - and who will enjoy doing it too - to help you achieve success.

Are you boxing yourself in by thinking in a limited way? Can’t you break out of the box, think bigger, and leverage your way ahead more quickly than you thought possible?  When you think about it, you realize that leverage is just another way of “thinking big.” Donald J. Trump says that is the central ingredient of success. Don’t you think so too?