Do You Have the Mindset to be on Shark Tank?

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I am a huge fan of the show, probably because I have been an entrepreneur now for over 25 years, always generating my own income since I was 19. I like a lot of the investors, but I think the one I like the best is Robert Herjavec. Every time a new entrepreneur wannabe steps up and tells the tank how much their own time is worth, Robert get visibly annoyed and has no problem expressing his feelings about the subject. Being a life long entrepreneur, I completely understand his logic and feelings.

Many who read BiggerPockets are Real Estate Investors, or would really like to be. We all talk a lot about investing in real estate, investing money in real estate, finding other peoples money (maybe a Shark!!) to invest in real estate, investing on notes, leases, etc. What do we really invest? I think that really gets overlooked. Money is the least of what we truly invest. We invest our most valuable commodity…our time. We all have a finite amount of time on this earth, and none of us know how long we have. What we choose to do with it is totally up to us. We may choose to invest our time in many areas. In no particular order some of these areas are: Faith, Family, Friends, Health, Business, Entertainment, Adventure, Travel, Self Development, Success, Charity, Philanthropy, etc. For the purpose of this article, lets chat about investing our time in ourselves and our financial futures.

A few weeks back I was in a discussion with someone who wanted to flip his first house just like we do. As we talked, he kept going back to the value of his time. I, like Robert Herjavec, found myself getting visibly annoyed with the discussion. I finally said, “You want to place an hourly rate on your time to see of the deal makes sense? You actually want to put a line item on the projected budget sheet showing your hourly rate as a cost????? Are you freaking kidding me???????? Don’t you have any idea of how much you actually learn through the process of doing your first flip, or your second, third, etc.? Even if it costs you $10,000 because you lose money, I guarantee you, if you have what it takes to stay in the game, you will have learned enough valuable lessons from that one experience to make you a fortune down the road!” In my opinion, searching for your hourly rate is a real employee mentality and will always severely limit your success and potential.

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A Journey Into The Mind Of An Hourly Employee

People pay hundreds of thousands of dollars for college degrees and continued education. College or any continuing education are great for personal growth and development. What if these people, some who think their time is so valuable, looked into the future to predict how much time it would take them to learn a trade, and decided if the schooling was worth it or not before committing? That sounds a little absurd, doesn’t it? Here is how that would look in their brain. Hmmm, let me see … I get a job and work my first year out of school and make $50,000 (not so easy in todays economy, but let’s be optimistic). 2000 work hours, $50,000 divided by 2000 work hours is about $25/hr. Sounds decent, now let me see, I will have to go to school to learn this trade for 4 years, so about 4000 hours…so I also need to calculate my valuable time (HA!). Let’s recalculate. Now my first year out of school I make $50,000. I will have had 2000 actual work hours, but I need to calculate all of my VALUABLE UNPAID TIME IN SCHOOL (what a joke!), that was about 4000 hours additional (which by the way I plan to pay $200,000 for). So I have put in 6000 hours total (4000 schooling, 2000 actual work) and I make $50,000. Hey, that works out to only $8.33 an hour. So now I have invested $200,000 and 6000 hours to earn what?? Forget that!! I am worth way more than $8.33 an hour!! I am not even going to bother wasting my time going to school! I’m going to continue right here where I’m working. Let me get back to work! “Ma’am, would you like fries with that?” 🙂

A Journey Into The Mind Of An Entrepreneur

Now let’s look into the mind of a true entrepreneur and see how he/she thinks about their time. I am going to be a professional real estate investor and create a solid financial future for myself and my family. I will do this using the strategy of (insert your specific plan here). I plan to INVEST my time to learn all that I can, and take action for as long as necessary to make my dreams become a reality. I know I may have to INVEST COUNTLESS HOURS and lose many times on my way to learning valuable lessons. I will INVEST in many courses and mentoring from those who have gone before me to create the life I desire. I will network and get to know other entrepreneurs, many right here on BiggerPockets to sharpen my skills. I will offer them as much help as I can to learn from them. I will never quit learning and INVESTING in myself to be the best I can be in my chosen field. No matter what obstacles come my way I will find a way over, through, or around them on my way to creating the life I desire. Nothing will stop me, not even years of invested time without pay! I will stay the course until I reach my goal and beyond.

It’s Not About Where You Work Or What You Do. It’s About What You Think!

I want to clarify before we continue so I am not misunderstood. There is nothing wrong at all with working for someone else and getting an hourly wage. There are all different levels of entrepreneurs. You can work for someone your entire life and still have the entrepreneur mindset, and be taking action on a smaller level along side your job. You may have the privilege of working for an entrepreneur who allows you to be yourself and think like he/she does. You may be able to work within their dream and still reach yours, what a great place to be for a select few. Think about all of the people who were able to work with Microsoft, Apple, Facebook, Google, etc. I think you get the point. It is NOT about where you work, or how you support yourself day to day. It is all about your mindset and where you choose to invest your time. Okay, now back to our story… 🙂

Hourly mentality differs drastically from the mentality of an entrepreneur. Hourly people look to see what their time is worth now, while entrepreneurs look to INVEST their time now to have huge returns later. Hence why the Shark Tank people are INVESTORS! They do not just invest their money, they have already invested their time and that is why they are where they are in the business world. They, like many of us here on BiggerPockets, have countless unpaid hours. But time after time, those invested hours can produce a great life for you and your family.

Look, there is nothing wrong at all with either path people choose in life, but if you choose the path of being an entrepreneur, don’t ever sit back to calculate what your time is worth in the building phase of your business. As an entrepreneur we have the privilege to work 5000 hours for nothing!! Because that time invested may very well produce a business or income for us that will allow us to work for 1 hour, and get paid for 5000 hours! That is the difference between what we think our time is worth now, and what it will be worth IF we choose to INVEST it wisely. And let’s face it, If you don’t have any money to invest…all you HAVE is time, so choose wisely.

Where is your mindset? Do you agree, disagree? Either way please let me know and why. I have a feeling we will have a lot of discussion on this one, so let’s start the fun! I look forward to all of your comments.
Photo: makelessnoise

About Author

Glenn Schworm

Glenn and his wife Amber are the owners of Signature Home Buyers , located in upstate New York. They have bought and sold over 100 houses and counting since beginning in 2008. They are also the proud parents of 3 amazing kids and love to travel the globe, scuba dive, skydive and basically live life to the fullest!

18 Comments

  1. Brandon Turner

    Great post today, Glenn! I’ve seen the same thing – people who treat their time when starting out as not worth it because it’s not “per hour” worthy. Amazing – the successful ones seem to be those who were willing to work for nothing at the beginning. It’s hard to convince someone of that though!

    By the way – your paragraph ending “Would you like fries with that” made me seriously bust out laughing. Thanks!

    • Glenn Schworm

      LOL, the sad part is I actually laughed out loud as I typed it! I didn’t know if it would read the same to others. Must be you and I are both a little twisted!!

      I often wonder if you can learn to have an entrepreneur mind set. I wonder if it is something you are just born with. I would be curious to hear peoples opinions on the matter. Thanks for the props Brandon.

  2. This is a very interesting and important topic. It is the intangibles that are hard to quantify when analysing one’s value in task and time. I for one try to use every minute in the day to its fullest potential and that is a task in and of itself. The beauty of investing and the entrepreneural mindset is that it builds on itself where an hourly paycheck is very finite. For my employer, I work an hour an get paid for an hour. The hourly rate might change with more hours worked but my hours worked mean little a year down the road. In my real estate business an hour worked at worst saves me from hiring someone else to do the task or mearly improves my service perception to my tenants or partners. At best my hours provide lifelong experience that can build trust, confidence, inspire confidence in others and save me time and money in the future and make me time and money in the future.

    One area where I actually did ballpark my “hourly rate” was on a property where I pirchase and did a huge amount of labor myself. This was over a year ago now and it was 200+ some hours for me. It didn’t translate to a whopping hourly rate but if I didn’t work those hours I would have had nothing from the experience. With this I have found that many people think too highly of themselves. Even ignoring the intangibles and just going with the “hourly rate” it is still income. I for one know that I gained a lot more by working 16+ hours a day for 40+ days that I would have coming home after my day job and watching the primetime lineup everynight.

    Great article. Every minute of life is a wonderful opportunity to enrich your life.

    • Glenn Schworm

      Kyle, thanks for the post. Sounds like you get it! We learn so much more from experiences and even failures than we do from reading and learning. I think we learn more from our failures than our successes. Somehow the experiences from failures seem to really cement themselves into our minds for the future. Its like sticking your hand in a fire…You just never forget something like that, and you never do it again!!!! 🙂

  3. Great article about value of time. I learned recently that when you work for yourself, you work at Wholesale and collect at Retail. When you work for someone else, you still work at Wholesale, yet they collect the difference between Wholesale and Retail. So as an entrepreneur, you are in charge of everything, and the one thing we all have the same amount of, is time. So I have learned a few things from Cuban from the show, that deals and projects have to be worth your time. It does not matter if you are a minimum wage or millionaire per hour, the time has a value so remember it next time you find yourself getting wholesale for your time.

    • Glenn Schworm

      Jack, so true, so true!! YOu notice that they are much more careful about investing when it requires their time. At this point in their lives, money is money. They have a lot. But their time is still a finite amount so they choose very wisely where to invest it. Thanks for the reply!

  4. Awesome article! I have days where I wonder why the hell I left a comfortable 6 figure job to work twice as much and make next to nothing in a new town half way across the globe. What really resonated with me from your post is:

    “As an entrepreneur we have the privilege to work 5000 hours for nothing!! Because that time invested may very well produce a business or income for us that will allow us to work for 1 hour, and get paid for 5000 hours!”

  5. It is a difficult line to straddle.
    The whole reason to become an entrepreneur is because you think your time and talent is worth more than you are getting paid.

    There is a difference between evaluating if an oppertunity is worth the time required vs factoring in a “salary” in your calculations.
    This of course is especially true if you are trying to get an investor to give you funding for your ventures. That is the stuff that gets the WTF? look from Robert on the show. 🙂

    • Glenn Schworm

      Shaun, I totally agree with you. I would add this to it. One of the main reasons we become entrepreneurs is not for the money or more money, it is for what that money can give us…more freedom and a lifestyle that others want but don’t have the ba”** to go after!

  6. karen rittenhouse

    Glenn:
    Trading time for money will always have you running into a financial wall. There are only so many hours in a week that you can be paid for.

    The transition is to learn how to put your money to work for you. That involves a learning curve. And how much you make per hour is totally irrelevant. If you make $250,000 per year but spend $275,000, your salary sucks. What matters is how much you increase your net worth each year. Most people have no idea because most people (employees) don’t increase their net worth year over year.

    That being said, we do zero physical work on our own properties. Why? Again, the time/value of money. Our value is in making deals, not wielding a paint brush. I tell my students that a millionaire makes $500 per hour so, if a job (painting the walls, repairing a toilet) can be done for less than $500 per hour, hire it out.

    Thanks for the post!

  7. Glenn,
    Thought provoking post. I’ll take the opposite side of the debate just so someone does add this perspective. ;). My education cost $25,000, in 1980 to 1985. I graduated and made $27,300 in 1986. A very good salary for the time. I have never been paid overtime, and some would say foolishly, I work it. Much like the “entrepreneur” I honed my skills working for the man. I still put in 60 hours at work, own multiple investment properties, provide private lending and new construction lending. When maintainence needs performed on my residence, I generally do it, not because of my time being worth more or less than a tradesmen, but because I can and I can teach my kids these skills. As my father taught me.

    I am fortunate to work for a great company that rewards hard work and top performers. Unfortunately, not all companies are this way and give the corporate world a bad rap.

    As far as my formal education, I would not be where I am without it. I needed this time to mature and learn in a more structured environment. Not everyone is driven, social and outgoing when they graduate high school.

    The benefits of a technical engineering education. My time in college was an investment in education and is forever increasing in value. A gift from my parents which I can never begin to repay.

    Kevin

  8. Glenn Schworm

    Kevin,

    Great reply, thank you for posting. However, I am not convinced it is the opposite side of the discussion. Sounds to me like you have the best of both worlds. As I mentioned in my article, it seems as though you work for a company that allows you to be successful and an Intrepreneur inside of their framework. Then it sounds like you are also an Entrepreneur on the outside of your daily job as an investor. Plus you are teaching your kids valuable life lessons and you have great parents to whom you are grateful to. Since the goal of many is a happy fulfilling life, sounds to me like you have it my friend. Sorry to burst your bubble! 🙂

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