Ever since I read Robert Kiyosaki’s Cash Flow Quadrant, I have been fascinated by the mindset difference between entrepreneurs and employees. Kiyosaki divides people into the four quadrants of Employee, Self-Employed, Business Owner, and Investor. Employees and Self-Employed are on the left side of the quadrant, and Business Owners and Investors are on the right side of the quadrant.
Changing quadrants is a life-changing experience and often requires a fundamental shift in ones core values in order to come about. This requires massive action and massive personal transformation. You will be required to step outside your comfort zone. Once you have crossed the proverbial Rubicon, or "crossed from the left side of the quadrant into right side", there is generally no turning back.
Identifying where you are in this "cash-flow" quadrant can be done by looking at where most of your income comes from. What affects which quadrant we decide to generate our income from is due to internal differences in our core values, interests, outlook, life stage etc. Traditional schooling teaches us largely to focus on become an employee (E) or a high-paid self-employed(S) individual such as a doctor, lawyer or accountant. Whilst there is nothing wrong with this idea, it becomes a problem if your primary goal is to attain financial freedom. Financial freedom is seldom to be found in these quadrants.
The words 'financial' and 'freedom' go hand-in-hand. You can never really be truly "free" in the modern world we live in unless you are financially free. The whole purpose of life is to generate and experience more life. Money allows you to live more life. Financial freedom is when you have enough wealth (assets and cash-flow) to allow you live more life on a sustainable basis.
It is important to note that success is not guaranteed. It is a known fact that 80% of all businesses start-ups never get to celebrate their 5th birthday. And of those that have become successful, many successful bussiness owners "B’s" have lost their money through over-confidential forays in the Investor "I" quadrant. The road to financial freedom is littered with casualties and its for this reason that people turn back on their goals. They do this out of fear.
Many of the skills required to be successful as a business owner(B) or investor(I) are not taught in school. In fact it’s remarkable just how many successful business owners left school early but got their real education in the cut and thrust of the business world. Most successful business owners are innately curious, knowledge-thirsty and uncompromising in the pursuit of their goals. They chose to learn through Mentors; they read voraciously, and attend training courses and educational seminars converting this knowledge into action. The rules of the game are totally different in each quadrant. They are completely different worlds and require different mindsets, tools, skills and behavior.
So how does someone begin to think with the mind of an entrepreneur? The mindset shift is to take time out of the money equation. Whether you own a business or work for a wage or a salary, if you trade time for money, you have not made the fundamental entrepreneurial mindset shift of a business owner on the right side of the Cash Flow Quadrant. You have not separated time from money.
Employees and self-employed people trade their time for money. No matter how much you earn per hour, per month, or per year, the amount of money you can earn is limited by the fact that time is limited. As a result, no matter how much you get paid per unit of time, your income will always be limited by time. When you take time out of the equation, money is potentially unlimited.
Continuous learning and education will be your constant bedfellows in order to help you on this journey. If you are ready to change quadrants but don't know where to begin, email me directly and I will share with you all i know for free! For more information or comments, please leave a comment below.