The Power of Broke was the selection for our 2016 third quarter book club discussion and honestly, it would not have been my first choice. But it has been fun to read the titles the team picks that are outside my long running list of business books to tackle, in addition to the enthusiastic discussions (like or dislike) that ensue.
My biggest takeaway from The Power of Broke came as I reflected on investments I’ve made over the last 20+ years. On occasion, when entrepreneurs take on new capital they change their mentality on the value of each dollar, even when they continue to hold a big percentage of the ownership. I literally remember countless conversations with company leaders, following an investment, where statements like the ones below were made:
- “We changed the way we buy inventory,”
- “We can afford to gamble now,”
- “I know the first round didn’t work, but if we just do more it will be better,”
- “What made us successful in the past won’t work in the future,” and more.
However, as I read the book and then reflected on the conversations and actions of some of our most successful partner company leaders, I realized there was a common trait or theme. They all fully respected each dollar that was spent. There was a leader that audited a $20,000 bill at the end of a $72,000,000 sale; leaders that have called to complain about airline baggage fees; and even leaders that refused to claim a business expense on any alcohol they consumed while traveling; and many more statements like this… I want to stress, these leaders are not cheap, they are frugal and respect every dollar. I agree with Daymond John, the power of feeling broke drives creativity, energy, focus and often is the key to success.
Some additional powerful take-aways from The Power of Broke include:
- Money does not make the company, but can certainly break it. Often large injections of capital change the way entrepreneurs read and interpret the market, making larger bets that don’t pay off.
- Authenticity speaks to customers, you and your people are the brand. The marketplace has never been more democratized. Hope, honest and vulnerable content will resonate.
- A brand is not launched with a product, but grows over time.
- To achieve success, get hungry and stay hungry. You don’t need to be broke to practice the power of broke.
- Setting goals will provide a roadmap to success. Make shorter term goals that move on to longer term goals.
- Love what you do, if needed, you would do it for free.
- View every opportunity as the key to the next opportunity.
Overall, worth a read, and I would encourage you to create a formal book club within your organization to actively engage your leadership and employees in discussion, and possibly even learn a little something about and from those you work with! It has been fun here at ScaleCo.