Donald Trump and Robert Kiyosaki on Network Marketing

In part 5 of the book Why We Want You To Be Rich, both Donald Trump and Robert Kiyosaki shared their thoughts about network marketing. They informed us many things about network marketing but I just want to share 13 things I learned from them. These are:

1. Network marketing as the bridge to start a business towards investment in real estate

2. The benefits offered by network marketing such as investing in education, personal development, and personal business of its distributor/business partner (p. 306).

3. That network marketing business is a B quadrant business (p. 307).

4. That network marketing passed the fivefold criteria of a B quadrant business: leverage, control, creativity, expandability, and predictability (p. 307).

5. That network marketing is the exact opposite of pyramid scheme (pp. 307-308).

6. It takes time to be successful even in network marketing (p. 309).

7. Network-marketing companies are patient (p. 309).

8. Network marketing has a proven system already (p. 310).

9. Starting one’s business through network marketing is like buying a business franchise in an affordable price.

10. It costs much less to get started in network marketing than building a personal company (p. 310).

11. Network marketing as one of the fastest growing business models (p. 310).

12. An opportunity for me to develop my social skills (p. 311).

13. Do a personal research and promote your product with enthusiasm.

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Network Marketing and the New Economy

I encountered Eric Worre and NMPRO through the help of one business coach. As a result of such encounter, watching Worre’s videos becomes a part of my daily activity. In watching his videos, my belief in the legitimacy of network marketing as a big business system was reinforced.

Network Marketing, An Invalid Business Model or A Better Way of Doing Business

Most people think that network marketing is not a valid business model. Various factors contribute to the perception of the public about this “bad image” of network marketing industry. People with “lottery mentality” entered this business thinking that they purchased a ticket to easy wealth and hoping and praying that without fun, personal growth, and hard work, they will achieve their desired financial independence. Unprepared people who quit the industry spread the word that network marketing is a “scam” and not a legitimate business system. Such people contribute to the misinformation of the public and as a result majority of people are blocked from seeing the potential of the industry. Crazy product claims apart from scientific and clinical studies are widespread. These are few examples that destroyed the image of the industry. However, in spite of these “ugly things” happening in the industry, network marketing is here to stay. Robert Kiyosaki calls it The Business of the 21st Century. 

Eric Worre claims that network marketing is not perfect but it is a “better way” than the corporate world, sales work, traditional small business, and blue collar work. A diligent student of financial literacy will come to two unavoidable business convictions. And one of them is the belief that network marketing is a big business system. People like Donald Trump, Robert Kiyosaki, Paul Zane Pilzer, and Warren Buffett share this belief that network marketing is indeed a legitimate business and provides the vehicle to financial independence.

Prominence of Network Marketing in the New Economy

The video by Eric Worre about Network Marketing and the New Economy speaks about the trend in global economy today. This video was posted last March 2009 but its message remains true up to this day. He said that many things are happening around the world today. The global economy is in crisis, the stock market is unpredictable, the banking industry is blamed, house mortgages are in deep waters, incomes are constantly decreasing, and businesses are struggling. The response of the government to this crisis is stimulus package. Bailout is the popular word. Eric Worre believes that in the long term everything is going to be fine but in the short term the unprepared will surely be financially challenged. 

Eric Worre claims that during times of global financial difficulties, history proves that network marketing industry prospers. Therefore our current economic situation provides a great opportunity for network marketing to thrive. He believes that we will be witnessing a change in the entire career landscape of network marketing. Like in old days, when franchising was still new, most people thought it was a “scam.” Now, it has a established reputation. The same thing will happen in network marketing as a profession.


Five Reasons for the Prominence of Network Marketing in the New Economy

Eric Worre predicts that from 2009 to 2019, the new economy will be performance based. As such, network marketing has been prepared to fit perfectly into this new economy. And there are five reasons for this:

  • Network marketing is purely performance based and provides the possibility for a huge passive income.
  • The world is getting smaller with the advent of the Internet. Communication now is easy through social media and it is now possible to build a global business.
  • As the crisis becomes worst in the coming days, people will soon realize their financial situation.
  • As a result of such realization, people will search for alternatives.
  • And finally, we will be witnessing an avalanche of people entering this $120B industry. Now is the time to make network marketing as a career choice. It is time for network marketers to be professionals.

Eric Worre gave an advice for those outside this profession to go out and look for a company, which can provide the vehicle you need to the path of financial independence. To those who are already into this industry, it is high time to be proud and to work hard. The global economy is in transition and network marketing professionals are its leaders. 

Eric Worre, as his usual custom, ended his video by saying, “My hope for you is that you decide to become a network marketing professional. If you do, you and I can be the change you want to see in the world. It is a stone cold fact that we have a better way. So go and tell the world about it.” 

Source: 

http://networkmarketingpro.com/2009/03/12/network-marketing-the-new-economy/

Value of Network Marketing 1: Life-Changing Business Education

Eric Worre of NMPRO (Network Marketing Professional) asserts that network marketing is a better way than employment, small business, sales, and blue-collar job. This kind of business conviction will result not only from the experience of the industry itself but also from investing time to learn financial education. Reading books like “Cashflow Quadrant” and “Why We Want You To Be Rich” with an open mind would lead into this kind of confidence.

Network marketing is a120 billion dollar industry and 67 million people around the world are involved in it. However, in spite of the advantages of network marketing, at present, it still suffers a bad reputation in the eyes of the public. Some blame the media for this negative publicity and others admit that those in the industry themselves are the ones responsible for its bad image.

Robert Kiyosaki’s Experience of Network Marketing

Robert Kiyosaki proudly claimed that his mind was closed to the industry for 15 years not until he came to know that a very wealthy friend with a degree in accounting and an MBA in finance was involved in it. He became curious and asked his friend why the latter entered into network marketing. His friend identified three reasons:

  • He wanted to help people.
  • He wanted to help himself.
  • He loves teaching and learning.

Kiyosaki’s friend explained that most people do not have the money to invest in his businesses. By entering into network marketing, he was giving people an access to have the money that they need to invest. By helping people, he also helps himself.

Another thing that Kiyosaki’s friend liked among people in network marketing is the open-mindedness to learn. He found it exhausting to do business with people who think that they know everything while in fact, their skills in the Information Age are already considered obsolete. There are many people in the industry who are very smart and well-educated and yet still willing to learn. And those without formal education receive an equal opportunity to this “life-changing business education” for them to thrive both in life and business.

The opening of the mind of Robert Kiyosaki started. And he began to see the good side of the industry. He acknowledged that there is always something negative about most things. But this time he focused on the positive about the industry and he began his own research at the age of 47 about network marketing by joining a few companies and studying several businesses. Robert experienced first-hand the so-called negative aspects of the industry. He found them through the entry into the industry of “strange people” whom he called as “dreamers, hustlers, con men, losers, and get-quick rich artists.” The reason for this is that the industry has “an open door policy, which allows almost anyone to join.”

Robert Kiyosaki is qualified to give an objective perspective about the industry simply because his wealth was not achieved through network marketing. And in his booklet, “The Business School,” he intends to present the real value of network marketing that most people are not able to recognize. And he sees this value as the heart of the industry, which is the “education plan.”

The Heart of Network Marketing

For Kiyosaki, the most important thing to consider in choosing a network marketing company is neither the product nor the compensation plan but the education plan. The focus of the education is not just simply providing a list of books or just turning you into an excellent salesperson but growth as an individual and as member of a team, which Kiyosaki described as “the transformation of a caterpillar into a butterfly.”

The good thing in the education plan in network marketing is that the only qualified mentors are those who really made it in the real life and become successful. Here, Kiyosaki criticized most business school, whose professors do not have actual experience but derived their lessons from textbooks.

Another advantage of the education plan of network marketing is that the subjects taught are really relevant to the real world of business such as:

  • Attitude of success
  • Leadership skills
  • Communication skills
  • People skills
  • Overcoming personal fears, doubts, and lack of confidence
  • Overcoming the fear of rejection
  • Money management skills
  • Investing skills
  • Accountability skills
  • Time management skills
  • Goal setting
  • Systemization

For Robert Kiyosaki, life-changing business education has four components: mental, emotional, physical, and spiritual. The existing education system focuses only on the mental. What Kiyosaki disliked about traditional school is its impact to the other three components. As a result, it is common to see graduates with so much information but having problems when it comes to emotional maturity, physical skills, and spirituality.

Emotional Education

One weakness of traditional education is about committing mistakes. In school, we are taught to be afraid when we commit mistakes in examination and punished with low grades. This is contrary to life. In real life, Kiyosaki argues that people learn by committing mistakes. Traditional businesses do the same thing as the school does. Employees are fired for committing mistakes. In network marketing, mistakes are accepted and considered vital for a person to grow.

Physical Education

The educational process of people who are conditioned both in the school and in the world of traditional business will be hampered simply because they are trained to know all the right answers first before taking action and not to commit mistakes. This kind of environment limits the physical training of an individual, says Kiyosaki. He adds “Living in an environment of fear is not healthy, mentally, emotionally, physically, or financially.” In network marketing, mentors are there to guide a person to a life beyond fear and failure.

Spiritual Education

By spiritual education, Kiyosaki meant that it may or may not include religious education. By spirit, he meant the power that causes a man to move forward beyond mental, physical, and emotional boundaries, which usually limit human condition. The human spirit, Kiyosaki affirms, has power to overcome the emotions of fear and doubt.

Applying the above educational components to communication, Kiyosaki recognizes that limiting communication to purely mental accomplishes little. An emotional person who is afraid and insecure will be limited in his communication. In network marketing, he will learn to overcome his emotional limitation by speaking from his spirit. Finally, great network marketing companies know that physical appearance affect communication and that is why they focus on improving a person’s physical appearance.

Source: The Business School: For People Who Like Helping People (The Eight Hidden Values of a Network Marketing Business, Other Than Making Money) by Robert Kiyosaki with Sharon Lechter, C.P.A.

Value of Network Marketing 2: Changing Quadrants

“I wish I could quit my job.”

“I’m tired of going from job to job.”

“I wish I could make more money, but I can’t afford to quit and start all over with a new company. And I don’t want to go back to school and learn a new profession.”

“I’m working hard, but the only people getting rich are the owners of the company.”

“I can’t keep working this hard. I’m getting too old for this.”

“I just want to do something different and meet new people. I’m tired of wasting my time, hanging around people without much ambition and who are not going anywhere…”

I took the above statements from the list of statements, which according to Robert Kiyosaki are coming from people  who are ready to transfer from the world of E and S into the world of B and I. 

An overview of the four different worlds of business:

  • E stands for the world of employees.
  • S stands for the world of the specialists, self-employed, and owners of small business.
  • B stands for the world of owners of big business.
  • I stands for the the world of investors.

Most people share the mindset of Robert’s mom and dad about big business owners and investors. They are often “considered greedy, evil, uncaring, and sometimes dishonest.” They represent “the dark side of life.” Therefore, wanting to transfer from the worlds of the E and S into the worlds of B and I is not an easy journey not only because most people are in the E and S but also because such a decision is perceived as “joining the dark forces of life,” people “who exploited the poor and the working class, and who had lost their religion.” With this common perception, the difficulty of transferring quadrants is not only due to financial limitation but because of the mental, emotional, physical and spiritual influences.   

In the previous post, I shared about the first hidden value of network marketing, which is the experience of a “life-changing business education.” In this post, we will see the second hidden value of starting your own network marketing business, which is “the value of changing quadrants.” 

There are three types of businesses under the B quadrant according to Robert: big companies, franchising, and network marketing. Among these three, only network marketing is accessible to anyone who wants to join simply because of affordable price of entry. 

For those who made the decision to transfer quadrants, I just want to summarize Robert’s suggestions into two:

1. Choose a network marketing company with a mentoring program for the transfer.

Robert based on his experience, claims that not all network marketing companies are similar. It is true that network marketing companies have mentoring programs. Ideally, the goal of such mentoring program is to guide people from the E and S into the B and I. But there are mentoring programs that fail to do that. Robert considers it priceless if you find a mentoring program in a network marketing company you selected guiding you into your transfer from the E and S into the B and I. Kiyosaki’s advice is timely. Since there are network marketing companies willing to guide you into your transfer to the B and I, choose cautiously for a “company with training programs that go far beyond just money, product knowledge, and sales ability.” 

2. Give yourself at least five years for the transfer.

The transfer is not easy. Most of our lives are spent among the E and S. There are physical, mental, emotional, and spiritual factors to be considered in this transfer. An example of physical consideration is the change of environment. It is difficult to find people in the E and S who can understand your decision. You need to associate yourself with people who think the way you think. You need to look for people with similar mindset. And the best way to do that is to change environment.

The mental process is also not easy. Kiyosaki calls the unlearning of the mindset of the E and S as “the hardest part” in this transfer. However, once you are done with this unlearning process, the transfer will be easier and faster. 

The emotional process is also hard. The popular perception of human learning is one of gradual and continuous increase. Contrary to popular perception and learning from nature, Kiyosaki calls it “the emotional learning curve,” which goes down first before it goes up. Most people find the transfer difficult due to the unwillingness to experience personal doubt and emotional breakdown. 

The value of guiding people to transfer quadrant is a very important service you can find in network marketing. They provide this service by doing the following:

  • They challenge you to leave your comfort zone.
  • They are willing to support you in times of doubt and frustration.
  • They have leaders who have made the transfer themselves and you can follow into their footsteps.
  • They will not fail you and remain patient no matter how slow you are, and
  • They want you to make it to the B and I quadrants.

Source: The Business School: For People Who Like Helping People (The Eight Hidden Values of a Network Marketing Business, Other Than Making Money) by Robert Kiyosaki with Sharon Lechter, C.P.A.

Value of Network Marketing 3: Access Into the B Quadrant Business

The third hidden value of doing a network marketing business is “the opportunity to access a B quadrant business at an affordable price and with less effort.” Now in reading the chapter about this third value, I find seven relevant questions, which touch primarily the issue of money as the primary obstacle to succeed in this business.

Question # 1: Why in spite of the fact that doing ‘B’ quadrant business is a better way, most people are not taking the journey?

Answer:

An obvious answer is either ignorance or misinformation. How can people take the journey if they know nothing about the existence of an opportunity to transfer to the B quadrant through network marketing? And all they know is about the negative publicity.

I find the answers of Robert Kiyosaki to this question scattered all over the chapter. One answer is the issue of control. People in the S especially find it hard to “let go” of the business. They love to do hands on. This does not mean that B business has no control. The manner of control is different. In B business, the control is done through a system. In the S business, control is done through the physical presence of the owner himself. This makes the journey difficult for to give up control for an S is difficult. It is not part of his mindset and core value. To change that mindset and core value is really hard. And that is why the journey to the B quadrant is not easy.

Another answer is related to emotional intelligence. Here Kiyosaki explained about “delayed gratification” and “addiction.” People in the E and S are addicted to money. They want instant gratification for their work. They cannot delay waiting to see the results of their efforts. This is true not only in finances but also in other areas of life like sex, alcohol, etc. Mentally, a person might agree that something is not good for him but emotionally and physically he craves for that something, whether it is money, sex or alcohol. According to Robert, the inability to delay gratification in any area of life is a sign of low emotional intelligence. And this is why most people are not taking the journey.

Still another answer is directly related to money. Money makes the transfer difficult. And this leads us to the second question.

Question # 2: Why does money make the transfer difficult while in fact the cost of entry in network marketing business is affordable?

Answer:

Here, Kiyosaki is aware that he is touching the core values of most people and he is anticipating that anger is the natural response. He claims that at the core of true E and S is money. True E and S will not work unless they work for money. Personally, I see that because of this, they miss many priceless things offered by a B quadrant business, which will determine success both in life and business. And these are: education, experience, business system, and community support.

Having said this, it does not mean that people who want to transfer to the B quadrant are not interested in money. They do but in a different way. People in the E and S approach money through a job and by taking charge of their small businesses. People in the B approach money through a business system. Here I find the insight of Robert very enlightening. He claims that approaching money through a business system does not offer any guarantee of financial rewards. Most of the time, you do not get paid for years. And there are times that if the business system does not work, you will never get paid. So there is a risk involved. True E and S will never work for years without financial guarantee. And that is why money is the most difficult obstacle to transfer to the B quadrant even though the price of entry into network marketing business is so affordable. Most people want money more than to change quadrants. In transferring to the B quadrant, a person must learn to break his addiction to money and learn to increase his emotional intelligence through delayed gratification.

Question # 3: Why many people do not succeed?

Answer: Many people do not succeed because they quit too soon.

Question # 4: What is the primary reason for quitting?

Answer: According to Robert’s observation, the primary reason for quitting is money again. The reason why most people join the business is to find extra money. When people realized that after few months of pouring out their efforts, and yet either little or no money came, they quit.

Question # 5: What should be the right reason for starting the business?

Answer: The right reason for starting the business based on Kiyosaki is twofold: to help yourself and to help others. Helping yourself means that by joining the business, your main task is to transfer to the B quadrant. By helping others, it means you help people in their transfer to the B quadrant also.

Question # 6: What kind of asset is network marketing business?

Answer: In network marketing, you are making an asset by creating B’s working under you whose job is to create other B’s under them. You will never succeed in this business unless you make E and S people become B and I. You can only do that, if you are a B and I yourself helping E and S to make it also to the B and I.

Question # 7: Isn’t this kind of business system pyramiding?

Answer: Robert asserts that it is not. It is ironic that most people who say that network marketing business is pyramiding are actually those people who work in the pyramid structure. For Kiyosaki, the traditional corporate system is the real pyramid. It is because only few B and I have the access to the top and more E and S are working at the base. Network marketing is actually a “reverse pyramid.” The system is structured to bring more B’s to the top. It is a system “that pulls you up not pushes you down.”

Source: The Business School: For People Who Like Helping People (The Eight Hidden Values of a Network Marketing Business, Other Than Making Money) by Robert Kiyosaki with Sharon Lechter, C.P.A. 

Value of Network Marketing 4: Access to the Investment of the Rich

People who do business in the B quadrant have the potential to afford to invest in the same investments the very rich invest in. For Robert Kiyosaki, this is the fourth value of doing the network marketing business. In the chapter where he discussed this fourth value, Robert shared his personal expectations and hopes, and his reality and what is possible for him. He believes that the same possibilities are open to those who will succeed in network marketing provided that people will include such possibilities in their reality.

Robert claims that the real power of people in the B quadrant resides not in the B quadrant itself but in the I quadrant. He also states that people from the four different quadrants have their own distinctive investment strategies. People in the E quadrant whose primary value is security adopt the same mindset in their investments. They want to invest in what they think are secure investments such as mutual funds. And their strategy is to diversify. Kiyosaki said that this type of investment is appropriate for an E due to absence of financial literacy. People who have financial literacy see such type of investment as risky simply because you have no control with such investment.

People in the S quadrant trust themselves more than anyone else. They cannot leave the job to anyone but themselves. This type of “I do it my way” mentality is carried through also in investing strategy. If an S will invest in real estate, he wants to manage it and sell it on his own. He loves to fix things on his own. If he invests in stocks, he likes “to day-trade with stock options,” or he likes “to read the financial papers, watch the investor news on television, and pick his own stocks.” This type of investing strategy is appropriate for an S, says Kiyosaki. For a B to do that, its only value is to gain experience but inappropriate for he is not utilizing his full potential.

Kiyosaki confidently claims that if only people will truly understand this hidden value of network marketing, more people would get into the business. The problem is most people do not do their due diligence and simply believe the words of those unprepared individuals who entered into business whose only interest is immediate cash. 

So for Kiyosaki, the four distinct investing strategies of people from four different quadrants can also be classified under two types of investors:

1. Those who invest because they do not have enough money. These are people coming from the E and S quadrants. And

2. Those who invest because they have too much money. These are people who became successful in the B quadrant.

Upon hearing or reading this kind of message from Robert Kiyosaki, his critics see that his message is very dangerous simply because he is giving people false expectations and false hopes. These critics fail to understand the message of Kiyosaki in its proper context. He is not saying that everyone in network marketing can make it to the B and I and therefore can invest in the same investments the rich invest in. He is just saying about the potential of those in the network marketing business for he personally witnessed first hand the success of those who have really made it. And added to this, Kiyosaki is just sharing his personal hopes, expectations, and possibilities, which are parts of his existing reality. He leaves the decision to his readers and listeners to determine for themselves whether his message is real or false. His challenge is that people must expand their reality. They should not make their situation in life as an excuse for failure. Instead, if you want to succeed both in life and business, use your situation as your reason to win.

In concluding the chapter, Kiyosaki said that he offers no guarantee. It depends on the person how determined he is to help himself and how open he is to ask the help of those who have done it. At the end of the day, Kiyosaki reminds us again about the role of money in this business: “This business is not measured in how much money you make, but in how many people you help and how many lives you change.”

Source: The Business School: For People Who Like Helping People (The Eight Hidden Values of a Network Marketing Business, Other Than Making Money) by Robert Kiyosaki with Sharon Lechter, C.P.A.

Value of Network Marketing 5: Living Your Dreams

I consider the fifth value of doing the network marketing business as the most important value. This is the value of living your dreams. Personally, I can look at the previous four values as just means to the realization of this value. Having the opportunity to undergo a life changing business education can both ignite a person to dream again or such education is vital toward the fulfillment of a dream. The values of changing quadrants, of access into a B quadrant business, and of investing in the same investment the rich invest in can also be viewed as such.

I already encountered the idea of “Dream Board” before but I found having such board in starting a network marketing business something serious in this industry. To make such board, especially if it is your first time to do it, appears to be awkward and funny to those people who do not understand why you are doing it. They may think that you are becoming too materialistic, ambitious and obsessed with an unrealistic dream. Some would perceive it as close to insanity. They cannot grasp how an ordinary person whom they know for so long could think of achieving those pictures placed on his dream board. And that is why there are some business mentors who gave advise to keep private this making of a dream board.

Our loved ones and friends want to protect us from ourselves for thinking too big, which they perceive is unrealistic and can be considered as an illusion. They do this out of concern. In network marketing community, people who do not support our dreams are described as dream stealers or dream murderers. Kiyosaki said “There is nothing worse than a friend or a loved one killing your dreams.”

Dream murderers say familiar statements like:

1. “You can’t do that.”
2. “That is too risky. Do you know how many people fail?”
3. “Don’t be silly. Where do you come up with such ideas?”
4. “If it is such a good idea, why hasn’t someone else done it before?”
5. “Oh I tried that years ago. Let me tell you why it won’t work.”
6. That’s unrealistic. Wake up. It’s too late. You have to be somebody to accomplish that.
7. I’ve tried that and did everything and look at me now. You cannot make it.

The number one problem with these people is that they themselves have lost their dreams. They only see the risk instead of the possibility, the difficulty instead of the potential, and people who failed instead of people who succeeded. Kiyosaki, reviewing the components of life-changing business education claims that those people who dream are coming “from the spiritual side of learning, and people who kill dreams tend to come from the emotional side” of learning.

The most important lesson, says Kiyosaki, in dreaming is not the accumulation of wealth but who you become as you journey towards the realization of your dream. Big people dream big dreams. Small people dream small dreams. People without dreams are people who have already forgotten who they really are and just go on with the motion of life without direction.

I love the way Robert classified people under five categories in relation to dreaming. They are:

1. “Dreamers who dream in the past.”

Robert describes this type of dreamers as “people whose greatest achievements in life” and “their best days are behind them.” The lives of these people are over. They live in the past.

2. “Dreamers who only dream small dreams.”

For Robert’s rich dad, this type of dreamers is the most dangerous. “They live like turtles’ and they “bite” if you knock on their shell. These people want to set small dreams, which are achievable for them for they want to feel confident about themselves. The problem with this type of dreamers, describes Kiyosaki, is that they are not going anywhere.

3. “Dreamers who have achieve their dreams and have not set a new dream.”

For this type of dreamers, their dreams in the past are now a present reality. The problem is they stopped dreaming new dreams and they now find their life boring.

4. “Dreamers who dream big dreams but do not have a plan on how to achieve them.”

This type of dreamers need a plan and a team to support them in the fulfillment of their dreams.

5. “Dreamers who dream big dreams, achieve those dreams, and go on to dream bigger dreams.”

In network marketing, people are encouraged to dream big and keep on dreaming. Again, Kiyosaki expressed his criticism of traditional businesses precisely in relation to dreaming. They do not want people to dream big and based on his experience he encountered too many people whose dreams have been killed in traditional businesses.

Network marketing is appropriate for people with big dreams and would want to support others in their dreams. The value of living people’s dreams is a hidden value in the business of network marketing.

Source: The Business School: For People Who Like Helping People (The Eight Hidden Values of a Network Marketing Business, Other Than Making Money) by Robert Kiyosaki with Sharon Lechter, C.P.A.