As a regular reader of ETR, I am frequently reminded of my own entrepreneurial adventures. The earliest involved my brother Leo.
Our first moneymaking idea involved automobiles.
Leo had a friend who, he said, was “making a fortune” by buying used cars cheap, fixing them up, and then reselling them. So we bought a car, fixed it up, and sold it. We didn’t make the fortune we expected, but we made enough to try it again. We bought, fixed up, and sold two more cars — with similar mediocre results.
Our fourth effort ended dismally. By the time we’d finished sprucing up the car, it was gleaming like new — but would no longer start. We had to call Leo’s friend to come over and help us. The cost of his help reduced our paltry profit on the previous three cars to less than nothing.
After we got rid of that fourth car, I told my brother I wanted out. He didn’t understand why. I explained that although we were able to sell all four cars, we were losing money.
He reluctantly agreed and we dissolved our partnership — and our hopes of becoming auto titans.
Next, he got me involved in the home refurbishing business. He said he had a friend who was doing it and “making a fortune.” His rationale seemed oddly familiar, but I agreed to try it.
Because we had few skills, we were limited to doing minor carpentry, painting, and small cement jobs. But that wasn’t a problem — at least in the beginning. Because our prices were cheap and because we lived in a neighborhood with lots of older homes, our business began with a bang.
We grew so fast that we had to hire helpers. But the helpers we hired had fewer skills than we did. And they didn’t care about anything but their paychecks. Their work was so shoddy that we had to personally go back to every one of their jobs and redo it. Even then, some clients refused to pay us.
Once again, it occurred to me that we were not making a profit. I told my brother that it was time to dissolve this partnership.
My brother called me several years later to tell me that the government had just minted a new coin: the Susan B. Anthony silver dollar. He said he was going to buy as many of them as he could and suggested that, if I were smart, I would do the same. “They will be worth a fortune one day,” he said.
I didn’t buy any. And though they’re not exactly worth a fortune these days, they’re worth a whole lot more than a dollar.
In the late 1980s, my brother called me to tell me that he had a friend who had a friend who knew a guy who worked at a pharmaceutical lab where they were testing a new over-the-counter drug. The tests were already confirming that this drug was for real. The drug company’s stock was at three dollars a share, and he suggested that I buy as much of it as I could.
A month later, my brother called to tell me that we were rich. The stock had gone up to eight dollars a share. I was flabbergasted. But I had to admit to him that I had “forgotten” to buy the stock.
“No problem,” he said. “This stock will continue to increase in value.” And, again, he suggested that I buy as much as I could.
Well, this time I listened. I bought five thousand dollars worth.
Five weeks later, the stock had climbed to seventeen dollars a share. Friends were visiting from out of town that weekend, and I was sort of bragging to them — and my wife — about how smart I was.
When my wife heard the numbers — how much I had paid for the stock and how much it was now worth — she said, “Sell it now, you idiot.”
I had planned on selling it the following Monday. But after my wife’s crack, I couldn’t do it. I held on to it for a couple of more months. But when it hit thirty-seven and a half dollars a share, I knew I had to sell, and so I did.
And that is how I made a (very) small fortune with my brother.
For various reasons, Leo and I had no more financial adventures after that. I have my own retail business now and some real estate. My brother is a tenured professor at a prominent university out west, but he doesn’t teach finance or business. As far as I know, he still has a few thousand Susan B. Anthony silver dollars tucked away somewhere.[Ed. Note: Simon Jerdon’s experiences as a wannabe entrepreneur aren’t unique. If you’ve ever tried to go that route without a lot of know-how, you know it can be tricky. But you can exponentially increase your chances of success with proven strategies that will help you achieve your business goals. Learn how to become more productive, set realistic objectives, and manage your time with ETR’s Epiphany Alliance program. ]