About a year ago I was trying to convince a business partner of mine to invest in another company with me. At the time things were going extremely well in our own business that we were partnered in. She looked at the investment I was proposing and came to the conclusion that it was too risky and that she did not want to get involved.
I invested without her even though I too thought the investment was a pretty high risk. However, the rewards were astronomical. So the money I invested was just a fraction of the money I had set aside for investing purposes.
A year later the business my partner and I are in has fallen apart. We are barely making any money from it at all. However, from the investment I got involved in I have made hundreds of thousands of dollars.
My business partner has had to go work for $30 per day just to pay the rent and to survive. So here is the question I pose:
Which was riskier? For her to invest or not invest?
If she had invested she might have lost the couple of thousand dollars she would have invested. She would have been in a “Loss Situation”. However, because she did not invest and therefore did not make the thousands of dollars I have made, she is out working now and is in an even bigger “Loss Situation”.
There is always risk! Since there is risk in doing nothing and there is risk in doing something I always recommend doing something. Life is about doing, living and taking action not just lying there and wasting time.
Off course there are certain general rules you can use when investing and taking risk:
Rule # 1- If it seems to good to be true – Do A Ton Of Due Diligence, but don’t just pass it up.
Rule # 2- Don’t put all your eggs in one basket. When you spread out your risk, you should expect that some things will go wrong, some will go right and some things will just stay the same.
1 comment:
That is Awesome Allan! - We Miss you! - Rheymar & Vanessa
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