This is a guest post from Ramit Sethi, who writes about personal finance and personal entrepreneurship at I Will Teach You to Be Rich.
If you want to start a business, the best $20 you’ll ever spend is to find successful entrepreneurs and take them out to lunch. They can be from your industry or other industries — it doesn’t matter. For example, if you’re interested in hospitality, you could pick up a hospitality magazine and see who’s doing interesting work. Then email them and ask to take them out to lunch.
Spend 90% of the time talking about them:
- Ask them how they did it.
- Ask them what mistakes they made along the way.
- In the final few minutes, you can ask about your idea. Is it crazy? What should you be thinking about?
After you meet two or three people, you’ll start to see patterns that you hadn’t recognized before. And that’s when you realize how powerful it can be to ask others for advice.
Yes, advice is cheap: Most people love talking about themselves. But entrepreneurs have a curious fascination with helping other entrepreneurs succeed. (At PBwiki, a Silicon Valley collaboration startup I co-founded, a bunch of us spend time each week meeting with first-time entrepreneurs and helping them brainstorm…and this is a common thing in Silicon Valley.)
People want to help you. All it takes is you reaching out.
J.D.’s note: This is a powerful technique, and not just for entrepreneurs. Over the past year, I’ve had lunch with several people I admire, and always come away feeling inspired and filled with ideas. If you have the guts to ask, the rewards can be enormous.
This article is about Entrepreneurship
This post is absolutely true. I have a few people that I have met or have been friends with that have created their own business and have been very successful. When I pick their brain and ask them how they did it, what were they afraid of, what do they enjoy most, they openly discuss. One of these people said that is how he got to where he is, by asking those around him who were successful how they did it. Also I’m not opposed to contacting complete strangers. When I run across a website that has a good thing going, or I see a business in town I simply leave a message with the owner and let them know I am interested in what they do and how they do it and I haven’t been ignored yet. In general people like to talk about themselves, especially successful people. Do yourself a favor and soak it up. Oh I forgot to add, don’t bug them once they have shared. If they showed a true interest in helping you ask them if you can come back later for more advice once you get your project in the air. They will be more willing to help once they see you have used the advice they gave you the first time.
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Sounds like solid advice. My home university (University of Otago) has taken the initiative to set up such a program – acting as a intermediary link between local entrepreneurs and students wannabe entrepreneurs. The student pays for either coffee or lunch and the businessman/woman in turn reciprocates with his or her wisdom/experience/contacts.
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This is definitely on top of my list for this week. I actually am taking a Entrepreneurship class in school where we have many speakers that I could contact.
Thanks
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My (very wise) college Marketing professor had great advice along those lines (for those who can afford it!) … upon graduating, find the most successful person in the business you would like to enter into, and offer to work for them for free for a year. Then learn everything you can about the business from that person.
Well how many folks can afford to work a year for free right out of college? Not this girl … but if I could have, it definitely would have been excellent advice, as I feel one’s first job/experience out of college can guide the rest of one’s career.
I think the $20 lunch is a much more affordable (and practical) way to get the advice to jump start a business idea and/or career.
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Great advice, I’ve done the same thing in the past. I work alone so I don’t really get a chance to socialize at work which is another benefit to this.
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I sooo wish I had heard and taken Ramit’s good advice back in 1992, when I started my own company. Like many young people, I had more guts than sense back then, and my business and I ended up surviving a bankruptcy in the course of becoming wiser. I’d invite you to profit from my mistakes by looking at my top ten tips for entrepreneurs: http://www.diamondcutlife.org/top-ten-tips-for-entrepeneurs-part-i/
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Solid.
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JD and Ramit in one place: priceless.
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JD and Ramit in one place: priceless.
Actually, this reminds me: When I was in San Francisco last spring, Ramit and I put this principle into practice when we met for dinner one night. We picked each other’s brains, just as he says to do in this post.
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When I started my own law practice, I did this – took a guy who was successful out to lunch and listened to his war stories and advice. I also read an ancient book called something like “how to go out on your own right out of law school without starving.” I didn’t go out on my own *right* out of law school, but it was still mostly applicable.
The best tip I remember is to keep overhead ruthlessly down, especially at first. Work at home or rent a single office in a complex, not right downtown. Don’t hire anyone permanent until you really need to. Make do with your current computer. You can afford a *lot* more bad months with practically no overhead.
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This is so important. It is even better to develop long term relationships with people like this. We have a small circle of friends that have all started their own businesses in our industry and we get together often to talk about new ideas, vent frustration, encourage one another. This has been one of the best resources we could ever had. Worth much more than the $60,000 degree I have that I never use.
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This is a great way to build some creditalblity in your industry as well.
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First: credibility. Sorry, but the irony is killer.
Next: Good post – there is no substitute for networking and learning from experts.
Last: @Nima – spot on. Contact one of those speakers. As one who has addressed classes like yours, I can tell you it’s VERY rare to have anyone follow-up… and frankly I’d hire such a student, circumstances permitting.
Good post.
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I agree picking successful peoples brains over lunch is awesome but if you’re a woman different rules apply.
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Good advice for life in general. Find the person you want to be in 20 years and learn as much as you can from them.
Being a woman makes things slightly different, but you just have to adjust accordingly. Most of my role models have been men who didn’t have to worry about childbearing and rearing, while successful women in my field generally have a personal life (or lack thereof) that wouldn’t work for me. I think you can glean a lot from everyone, but realize that not every piece of advice is going to be applicable to your particular situation.
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This is a wonderful idea, and something I’d never thought of before. It definitely sounds like a great way to get first-hand advice and network.
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Another great thing about meeting people for lunch is that they can introduce you to other people they know. You might never have heard about this other person. This is the best kind of networking, because you’re not doing the hard sell.
This happened to me recently. I meet with a mentor over lunch on a regular basis, and in talking about various things, it just so happens that he knows someone who used to be in a similar position to me. He offered to set up a meeting so we could talk, because he thought we might be able to learn something from one another.
It’s unlikely that I would have discovered this third party on my own, and I’m really looking forward to seeing what I can learn from them.
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You can get the same effect from joining (or creating as I did) a mastermind group, inviting people you consider successful to join. This way you get all those benefits and continued mentoring and feedback.
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This is a good idea. Another way to do this is to set up a meeting with SCORE. You will get some good information and you can ask all the questions you want. Even go back for a follow up meeting. Best of all, it doesn’t cost you a thing. http://www.score.org/index.html
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This is absolutely the best advice. I have traveled the world and been consistently employed because I have asked to “meet up” with people I admire.
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$20? Where are you taking them? McDonald’s? Good advice but even if you don’t want to go somewhere flash, I think you’ll have to budget a bit more than $20 to pay for the both of you somewhere reasonable.
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I’d recommend asking people out to coffee. Everyone has 30 minutes to spare, even if they claim they’re too busy for lunch. Regardless of the meal, it shows initiative and ambition to cold call someone—great characteristics in new employees.
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This is such a simple thing to do that requires little investment on your part and has a huge ROI. It is even good to have more than one lunch with the same person. I have found that one lunch doesn’t allow you the time to get all your questions answered, so I try to schedule another lunch a few months down the road to talk again, if the first one went well. And just like you said, people like to talk about themselves and their successes, so scheduling another lunch usually isn’t a problem. Thanks for the great post.
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Thank you, this was a great post; I came by way of Amy’s Humble Musings. We have found this same idea to be true in music. Our greatest help getting started came from other musicians who were further down the road than us, and all we did was ask for their advice, and they were so gracious to give it. Since I did all my asking by e-mail, I probably owe our friend a gift certificate for lunch out. ;o)
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Metorship… It’s one of the cornerstones of success – so true.
The beauty of reaching out is that your mentors will have already been through some of the challenges you are about to face and so their advice can prove to be quite meaningful. Their input can save you time, money and even propel you forward faster than you could move on your own.
Cheers,
Eff Jay
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I had my $20 dinner with my mentor.
She say i should publish a book on saving money.
I’m meeting sponsors and in dire need for content. the book may or may not make money. Is this article copyable?
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Also presents a great opportunity for you to offer your lunch guest some free work (I learned this tactic during your recent visit to Denver!)
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Hey Ramit,
The most effective purchases are investments. The $20 lunch with someone who can help you achieve results is an investment.
Just like buying a book for $10 that will accelerate your growth will give you a 1,000,000x return on investment, taking a value-giving person out to lunch is a huge ROI.
The personal tips and direction you’ll get (as well as what NOT to do) is invaluable. Why try to guess? Just talk to somebody who’s doing what you’d want to do, and find out EXACTLY what to do. If it ain’t broke, don’t fix it.
And what better way to talk to someone than over lunch? People love to eat.
Great tip. Simple yet so effective,
Oleg
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No arguments with me about how taking people to lunch is a great idea. My only quibble is with the budget. $20? Is that for both of you? Even if it’s only for one of you, it’s a tight budget. You’re asking someone to give up their time – you don’t have to do fine dining but it shouldn’t be a sandwich either.
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You don’t necessarily need to be dining in New York either. $20 goes a lot further in Calcutta or Tallin, Estonia, if that’s where the lunch happens to be…
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Forget the dollar amount. Pick your own dollar amount. maybe Ramit is cheap
The dollar amount is besides the point!
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