This Issue: Your Business is the Mark You Make in the World

Most of the time, being innovative is simply putting together existing elements to create what appears to be new. I was touted as being innovative when I came up with the mixed use condominium and hotel tower, which I did with the Trump International Hotel & Tower in New York. Since then, the concept has been copied by myself and others, and it has proven to be tremendously successful nationally and internationally.

To me, the idea was common sense, and I didn’t think I was being particularly creative. When I look back, maybe I was. But when I read subsequent articles about innovation and certain inventors, it got me thinking about how one might become an innovator, which is something I think is important for students to think about.

I remember reading about a composer named Steve Reich who came up with a new idea called phasing, which is like windshield wipers going in and out of synch. Apparently he was caught in a traffic jam one rainy day and the rhythm of the windshield wipers caught his attention and he applied what he heard to his musical compositions. He has had a significant influence on contemporary music and I think he’s a great example as an innovator. Sometimes new ideas can come from something as mundane and functional as your windshield wipers. The key is to pay attention and keep your brain and senses open to new stimuli.

It also helps to be thinking of two things at once--multi-level focusing is what I call it. The intersecting of ideas is when innovation will follow--thinking in musical terms while listening to your windshield wipers, or thinking of a hotel tower and condominiums at one time, or maybe watching a stone roll and imagining a wheel. Who knows what will result? Sometimes it will be fantastic and other times it won’t, but it gets the mind working in new dimensions that can sometimes prove fruitful.

This can also happen without deliberately attempting to be innovative, so the other technique to employ--consciously and unconsciously--is to keep an open mind. That’s very important in business as well as in the creative arts. Don’t limit yourself to staid thinking, because you want to excel in business. My first book was called The Art of the Deal because I view business deals as being an art form. Maybe that’s why I’ve been a successful dealmaker. I employ both sides of my brain when I’m thinking and working.

You may be aware of the number phi (which is pronounced ‘fee’) which has an astonishing history. It’s been employed by people from Pythagoras to da Vinci and most likely the builders of the pyramids used it as well. It’s been around for a long time and the number itself is 1.6180339887. It’s called the golden ratio and if you want to know more specifics, you can read The Golden Ratio by Mario Livio, who goes into great detail about it. My point is that it appears that some people use the number deliberately, and other people know it subconsciously and it can appear in their work with or without intention. But it can be used intentionally, and very often is. It’s very mysterious, as this ratio appears in unrelated works and natural phenomena, from the chambered nautilus to galaxies to artwork and architecture. It can make your innovative attempts a little easier when you make an effort to understand that there are mysteries in life, and to be open to them.

I’m not advising you to dwell on the mysterious--a successful life requires common sense and hard work--but to be aware of things that are sometimes inexplicable, because it’s a big step towards innovation. We don’t really create, but we assemble what has been created for us. Be a great assembler, no matter what your interests may be--and you’ll be on your way to inventiveness.  A big mind requires a variety of thoughts and impulses to keep it well occupied, so make sure you keep your mind engaged in the best ways possible. It could very well be your calling card for success.

Should you buy a franchise? Will owning one give you entrepreneurial riches and independence?

Trump University Professor Richard Parker can answer those questions better than anyone else. He has been buying and selling businesses - and starting them too - since he was in his teens. In this recent conversation with Trump University’s Executive Editor Barry Lenson, Professor Parker shares insights from The Art of Buying a Business, the life-changing course he developed for Trump University.

Barry Lenson: Many people believe that owning a franchise minimizes the risks of owning a business - that there are systems, policies, and procedures in place that will minimize the hazards. So is it really smarter to buy a franchise than a non-franchised business?

Richard Parker: When you buy a franchise, you may have some better data to predict your profits and the overall success versus a brand-new startup business. That is because franchises, unlike other startups, follow a mass recipe that has proven successful in other locales. And yes, those systems, policies, and procedures are already in place.

However, any good non-franchise business has those same ingredients too. The difference is that franchises might have more credibility with consumers than other businesses do, thanks to a recognizable brand name, advertising and familiar products. But the bottom line is, any good business needs a recipe to succeed. Most franchises really only give you the ingredients.

BL: Many people buy franchises to avoid the cost of marketing, advertising, image-building and the rest. That seems like sound thinking, right?

RP: Those are major benefits, but they come at substantial cost. And you are never going to avoid those costs altogether. You will be paying a franchise fee right off the top line for them. Some of the strategies about how to handle advertising and marketing are laid out for you when you acquire a franchise. The question is, can you do a more effective job of reaching those same goals on your own? You may be able to do it for less money than the cost of a franchise.

BL: Are there any individuals who should avoid franchises altogether?

RP: Franchise ownership is not for everyone. It is best for people who don't mind following orders, who are comfortable embarking on a middle-of-the-road venture with no major upside and (hopefully) no major downside.

Many people buy franchises because they lack confidence in their ability to run their first business. That makes you wonder whether those people couldn't learn the skills they need in writing a business plan at an institution like Trump University and quickly know how to run a business and make more money.

So to summarize, a franchise is not for you if you have an ultra-strong entrepreneurial drive, a burning desire to break new ground or challenge the status quo. Nor is it for you if you are unwilling to put the needs of the parent company before your own.

BL: So what do you tell the person who really wants to own a business and is leaning towards a franchise?

RP: Let me list the considerations.

First, take an honest inventory of yourself. What are your goals? Your strengths? Your weaknesses?

Second, decide if you can live with, and thrive within, the confines of a franchise.

Third, make certain to educate yourself about the specific franchise you are considering. Franchise companies employ the slickest sales people you’ve ever seen - people who could sell you just about anything. So please be wary.

Fourth, if you’re absolutely convinced that a franchise is for you, buy a resale. One that’s already proven successful with customers in its current location.

Fifth, if you have an ounce of doubt about buying a franchise, then it’s probably not for you. Take the time to research and investigate non-franchised businesses for sale. You really are better off, in my opinion, getting into a non-franchised business.

Sixth, and most importantly, whether you buy a franchise or not, education is the key to your entrepreneurial success. Take the time to learn what’s involved and know what you need to do in each stage of the buying process. Ultimately, your knowledge will determine whether you succeed or fail.

Trump University Professor Richard Parker developed Trump University’s self-paced multimedia home-study course, The Art of Buying a Business. Barry Lenson is Trump University’s Executive Editor.

I know from personal experience that entrepreneurship is a tool that can create great wealth and personal enrichment in your life. Six of my 11 start-ups were a success, and I eventually sold the best one to a public British company for a handsome profit. The five non-successes (the word failure is not in my vocabulary), while they never generated revenue, did not weaken me at all. In fact, they enriched my chances of future success immeasurably because of what I learned and applied.

Entrepreneurial Misconceptions

The entrepreneurship literature is full of paralyzing drivel about the failure rates of new startups, the massive sacrifices entrepreneurs must make, the loss of job security, the financial risks, the long hours, the stress and frustration, and so on and so on . . .  I have two words for all of this:

Bull Cookies!

Look around you and imagine the vast wealth in businesses. Every business, from the largest to the smallest, resulted from entrepreneurship. According to BizStats.com, there are 24 million businesses in the United States, of which 18 million are sole proprietorships--owned and operated by one individual. Many small business owners are also part- and full-time employees while they maintain their day jobs. According to the U.S. Census Bureau, in 2003 alone (most recent figures available), almost three quarters of a million Americans started their own businesses.

The fact is, if you take it thoughtfully, step by step, your chances of success are excellent.You need less talent, skills, industry knowledge, money and other resources than you may believe. If you control your financial exposure and don’t make it on the first attempt, you’ll be better prepared for the next start-up. You can outsource most functions (design, manufacturing and packaging, marketing and sales, distribution and shipping, and accounting) and the resources you can mobilize on the Web are nearly limitless.

I never feel more alive than when I am on the entrepreneurial trail. I could never have made in any job the kind of money I have made as my own boss. Stress and frustration? The worst career stress and frustration I ever experienced was working for someone else, accepting a nominal salary, putting up with corporate political nonsense, and lacking the personal freedom to pursue my owninnovative, value-creating ideas.

For more insights on entrepreneurial success, read the new book Trump University Wealth Building 101: Your First 90 Days on the Path to Prosperity.