Warren Buffett Success Tips for Small Business Owners

Today I'm going to share with you four different things that you can use in your small business that made the likes of Warren Buffett billions of dollars trading stocks on the stock market. And I have invested up to a million dollars in the stock market. And these are the lessons I learned, the good, the bad, and the ugly. Number one, every single stock investor tries to do this, and that is buy low and sell high. In other words, this is a kind of what a graph might look like in the stock market. You got ups and downs, highs and lows. The goal is always to sell when everything is going and then buy when everyone's running for the hills and saying, we're going into recession and we're all going to die because of a disease like Covid. That's the time to buy. That's the time to go all in and commit to your investment. And in your small business, you might not necessarily have these fancy charts and dinging bells and green and red and people talking about stocks and, you know, going up and down. You might not have that in your small business, but what you do have is the highs and lows of emotion, the financial pressures in your business. Sometimes employees love you, sometimes they hate you. So customers love you. Sometimes you create reviews online, sometime they don't. That's the highs and lows that you're going to experience in your small business. But the same is true that you need to go all in when the times are against you, when everything is going wrong, when the employee just walked up the job, the customer yelled at you in the face, when the markets and the economy is not doing very well and your competition is starting to give up, that's the moment that you should go all into your small business. That's when you commit 100%. It's not fun, it's not exciting, it's not easy to do. Now, I was very, very lucky because in 2021, October of 2021, I made about how I was selling the majority of my stock portfolio to get into a real estate deal. I was very fortunate because in just a few months later, the stock market took a massive tumble. And through all of 2022, it was down and going down, down, down, down. But the thing is, during that low moment, during when interest rates are going up and there's a war in Ukraine and all these crazy things, that's the time to actually buy stocks. Not when it's crazy high in 2020 and 2021, when there's meme stocks and doubling and tripling day over day that's not when to buy stocks. The time to buy stocks is when everyone's in the, everything's in the gutter and we're all going into a recession. That's the time to buy stocks. And so I went from having a, almost a million dollars, actually just over, just over a million dollars in stocks, all the way down to about $250,000. And then throughout 2022, I just kind of kept buying because everything's low, low, low. And now, as I saw in January 2023, I kind of see like, hey, we're kind of out of the trough. A lot of the pain of interest rates has already been taking effect. And over the past few months, the stock market's done pretty well. Now, the bottom line is this is, that's the goal that's very, very difficult, whether it be stock investing or your small business, is to buy. When everyone says you're the best and you're amazing and you're winning local awards in your community for the best business of the year, small business of the year, entrepreneur of the year, you've got to sell off your stock in yourself. And the emotion of all that happening and not like, oh, now we're gonna expand and do all. And then you do stupid stuff and you buy trucks and you buy too many houses and you buy a bigger boat. Don't do that. At the same token, when you're really everything's against you, that's the time to really commit to the company. Now that's the goal of every investor. The vast majority of people will lose money trying to day trade or buy in and buy out of the market. The vast majority of investors when it comes to stocks will make more money trying to dollar cost average. What that means is you have a plan in place of how much you're going to spend every day or every single week or every single month. And you invest that money into the market. No matter what, you have a plan and you execute against it. And for the vast majority of small business owners, instead of trying to time the market of your emotions and the financials and the economics and what your employees are doing, what you should do is have a plan in place for what you're going to do in the business, how much you're going to spend on marketing, how quickly you're going to grow, when you're going to hire employees, when you're going to get the next crew and the next truck and the next piece of equipment. That is dollar cost averaging. Committing to the plan in place instead of trying to buy low and sell high. The vast majority, more than 90% of investors in the stock market would be better off just committing to a plan and executing against it consistently, regardless of the market and not getting involved in the emotion of investing. And the same is true for small business owners. Have a plan in place and execute against it. Don't do it based upon the economy or what your family thinks about you, or how you're feeling that day, or what you're doing, customers or employees think about you that day. You've got to just consistently have action and execution towards the plan that you have in place. And that's, in my opinion, the definition of dollar cost averaging when it comes to small business. Now, number three is buy and hold. Because as much as I like to say buy low, sell high, as much as I like to say dollar cost average, and some people will sell occasionally when they. The thing is, the vast majority of really wealthy people never sell. They just keep consistently buying more and more and more. You look at like someone like Warren Buffett, for example, he hardly ever businesses, he hardly ever sells any stocks that he buys. The vast majority of wealthy people when it comes to real estate and their businesses, they buy and they hold. And for small business owners, the reason I say this is a trait that you can also use in your small business is don't get involved in the next shiny thing. Oh, if I'm going to buy this and sell this and I'm going to go to this business venture in this industry and oh, I got to add this service and I should add this different type of marketing campaign. It's like buying commit and then just hold on to it. Hold on to your business. I feel like so many small business owners like the shiny object syndrome of like, oh my goodness, this service added to my business would just make it so much better. Oh, I saw this video and someone made so much money and profit on this specific type of truck, I'm going to go buy this. And they're going in so many different directions. When the vast majority of investors in the stock market realize just buy it and hold it. And for the vast majority of people that try to buy in and buy out and buy in and buy out, they lose more than the person who just buys and holds it for the long term. And for most small business owners, instead of trying to build it to like move on to the next thing, just build your business as if you're never going to sell it. The way that you'll run your business is so different when you have this Mentality, I'm never going to sell this thing. This is going to be a business I want to build for generations. I want to build this thing for hundreds of years. You'll be more conservative, you'll make sure that you're more profitable and you won't take short term actions that lead to massive downside results in the form of debt and dumb decision making that a lot of small business owners get them all tangled up when it comes to a recession. All right, now the fourth thing you've got to learn is stay away from the hype when it comes to investing in stocks. Personally, in my portfolio, if any of the companies I was invested in started to get in the hype cycle and people started really hyping it up and there was like memes about it and people on Reddit started talking about it and it jumped up like 20, 30, 40% a day. I was out like a trout. There was one specific drug that got passed by the FDA and because of that, the stock that I was in jumped 170% and only had a very small percent of my portfolio in it than 3%. But at the time I saw that and immediately sold because sure enough, that's the highest it has ever been. And now it's like 5 or 10% of that value because people buy into hype. Oh my goodness, the news, it's like that has nothing to do with the fundamentals of the profitability of the business. And so I always try to stay away from hype in stocks. And if something goes up 30, 40% and then does it again and again, and now everyone else is talking about it. And now it's super popular to invest in meme stocks. And now it's really popular to invest in NFTs and crypto. When things get popular, the riches have been made. The bulk of the riches have been made when things get into the mainstream and they're really, really popular. So what does that mean? Stay away from the hype in your industry? So when you go to a trade show or a conference and everyone's hyping up a certain type of technology or hyping a certain piece of equipment, or hyping up a certain type of marketing, it's like I'm very cautious of the fact that the majority of the riches have already been made from that specific technology or that specific, you know, stock, which in this case is just something that's really popular. And I've seen it time and time again. Industries like electric, we're all going to go electric and everyone Hypes up electric is like, it doesn't necessarily move the needle for my business to have an electric mower or an electric weed whacker. Like there's some benefits to it, but just the hype of marketing in your industry can fog the the direction and really cloud your decision making framework for what's right for the business. The same way that hype in the stock market clouds the judgment of someone that is like diligently trying to invest in good companies that are solid that might be making 1, 2, 3, 4% gains and they're like, man, that other company made 40% in one day and then 120% gains then jump the next day 400%. It can be very difficult to just stay in your lane and stay focused like a racehorse blinders on, focused on the goal. When there's all this hype action happening around you in stocks and, and in your small business, stop looking at all the different services and products you could sell and different businesses you could start and ventures and possibilities and oh my goodness, I should go into sales. And I saw this one video and someone mentioned you've got to stay focused. Now not too long ago, even in my business, I was distracted by a lot of different opportunities and different additions I could do my business. And I go over those specifically in this video here. The four things I wish I would have known and it took me five years to figure out and if I would have known them, I probably would have made millions of dollars more just by figuring this out sooner, at least cutting out time. So watch this video here of four different things that I wish I knew before starting my lawn care business.