I read a book almost 20 years ago that revolutionized the way I think…but not until now.
Why did it take 20 years for it to change my thinking? I do not believe that it actually took that long. Over the last 20 years there has always been some aspect of the book that I have applied to my business, professional, and even personal endeavors. However, it wasn’t until this past year that I began to implement it in a new way. And it wasn’t until even more recently that the book changed my current thinking.
Passive income book
The book is about passive income? Yes, and No.
In fact, there is a second book that I read only 2 years ago that began to shift my thinking to the point where I could recognize the impact of the first book.
Medici Effect: What Elephants and Epidemics Can Teach Us About Innovation taught me to look at ideas across disciplines. The premise of the book is that creativity and innovation of ideas occur when connections can be made outside our areas of focus.
Yes it is true that in order to be an expert in something that we must dig deeper than the next person. Yet, digging deeper into one subject can often lead to tunnel vision. When our thoughts become confined by that which we are focusing on, we hit a dead end. The temporary occurrence of this effect is often referred to as a “block”, the most common of which is known as “writer’s block”.
The Medici Effect on the other hand teaches the reader to intentionally look across areas of focus and strategically create periods of innovation and unparalleled creativity.
A word of caution from personal experience. Not every creative or innovative idea that you generate will be usable, let alone good. During a span of strategic innovation for a project I had worked on, I tried to converge the ideas of a card game, Magic the Gathering, and our client’s mission of international disaster relief. Needless to say, or maybe it does need to be said, it was an awful idea!
The first passive income book
The first book I read was Multiple Streams of Income: How to Generate a Lifetime of Unlimited Wealth! by Robert G. Allen. While Multiple Streams of Income presents practical vehicles for offline passive revenue, Robert G. Allen’s sequel focuses on the Internet, Multiple Streams of Internet Income: How Ordinary People Make Extraordinary Money Online, 2nd Edition. Now, in the mid 1990’s the internet wasn’t as prevalent as it is now (Al Gore hadn’t invented it yet…), so this might have been part of the reason I was not able to connect Allen’s ideas with love of technology and corresponding skill set.
But the core premise of both of Allen’s books have always stuck with me. Diversification!
Long term sustainable wealth comes from multiple streams of passive income.
Do not confuse multiple and diversified with detached and random. If you operate a pet grooming business, it probably is not the wisest thing for you to diversify and bring in income by also operating a mobile food cart (unless you are selling hot dogs…HA!)
Instead, look for connections. Look for intersections of what you are passionate about, what you can be the best in the world at, and ultimately what generates revenue for you (is aligned with your skill sets).
Allen uses the example of a speaker. For someone whom is a public (professional) speaker it makes perfect sense to sell audio recordings, and video recordings, and workbooks, and books, and audio books, and a community website subscription , and…
You see; all of these revenue streams connect, make sense, and provide diversification of your income base.
How we arrived at passive income as a core compenant of our business
There are many people that I need to thank for helping me to grow in my appreciation of passive income for business. A lot of Robert G. Allen’s ideas do not fit the Ansley Family Plan. They require one to be restricted to a relatively small region. They often involved managing a number of employees that required physical presence. And most of his ideas involved a large capital expenditure to get started (i.e. real estate).
These simply do not fit into our plan.
One of the people I need to thank is Pat Flynn of Smart Passive Income. Pat’s podcasts, detailed instructions, and complete humble transparency are worth a hundred thousand more than he is charging for them (it is free by the way).
There is also Dan Miller of 48days.com. I was introduced to Dan by a business colleague whom forwarded me an email newsletter from the 48 Days Team. It was about that time that I was interested in replacing some podcast subscriptions with a new voice, and Dan got the gig!
In a number of Dan’s episodes he mention “his podcast guy”, Cliff Ravenscraft the Podcast Answerman. I remember hearing about Cliff in one of Pat’s early passive income podcasts (episode 005). I figured if both Dan and Pat were talking about this guy…I should check him out!
Cliff and his GSPN community have been instrumental in honing the way I think about my business, my client’s businesses, and life in general.
Is passive income lazy?
I do not think so. Passive income is a lot like luck in my opinion. Luck occurs when opportunity meets preparation (Kudos to Dan for that definition). The same is true for passive income. Passive income occurs when opportunity leverages preparation.
So, how about you? How are you going to implement passive income into your business model?
How are you going to create multiple streams of revenue so that you can build generous business?
Leave us your comments below!