Kevin O'Leary says diversify across many businesses with a 5% allocation rule to protect against disaster. Evan Carmichael counters that entrepreneurs who spread themselves across 20 projects end up mediocre, citing Andrew Carnegie's all-in approach instead.
Good morning, Believe Nation! Today's message is: You have to diversify. Over to you, Kevin O'Leary.
Diversification. What I've learned that works if you're an investor, no matter how much money you've got, whether it's $5,000 or $500 million, Diversification is what saves you from disaster. Having investments in a wide range of businesses and sectors. There's always something working when something else isn't. So today I can go to bed tonight knowing that I have one objective. I want to go to bed richer than I woke up, and the only way that's going to happen to me is to be invested in a lot of different things. Because every day one thing works while three others don't. But sometimes that's why you get richer.
This is the first espresso that I've had a hard time with, and I'm wondering if I actually agree with it or not. I get how it works when you're investing in stocks. You don't want to have more than 5% of your money into one stock because if something happens and you could lose a lot of your money. But I'm not sure that applies to the rest of your life and any idea, right? He said don't invest more than 5% in any idea. And I think as an entrepreneur, it's easy to spread yourself too thinly And you should go all in on the idea that you love most. If you only invest 5% of your time or money into an idea, that means you're running at least 20 different ideas at the same time. That's crazy to me. That, that sounds like a disaster waiting to happen. And again, spreading yourself so thinly that you can't get anything done. Instead, you're doing a lot of stuff in a mediocre way instead of one thing really, really, really well. I'm a big believer in betting on your strengths, and when you find it, and that thing that you love and you're passionate about it, you go all in on it. It. And I'm a fan of Andrew Carnegie, who became the richest man in the world, and he said, in opposite of diversification, he said, put all your eggs in one basket and then watch that basket. So we've got a couple different views on this one. One says diversify like crazy, one says go all in on one thing. I'm really curious to find out what you guys think. So that's my question of the day for you: how much do you believe in diversification for your business? Leave it in the comments below. I'm really curious to find out. Thank you so much for watching. Have an amazing day. Continue to believe, and I'll see you again tomorrow morning for another shot of espresso.
