What’s wrong with the concept of multiple streams of income?
Hey everyone, Oz Konar here. In this video, I’m going to talk to you about what’s wrong with the concept of multiple streams of income. I’m sure you’ve heard this phrase before, “You got to have multiple streams of income to grow, and to be wealthy, and to make a lot of money. You can’t just rely on one source of income.”
Now, we’re going to dispel some of the myths about this concept and why, honestly, it’s keeping a lot of people broke. And of course, more importantly, how to fix the understanding around multiple streams of income so you know actually how to make it work to your advantage.
So, getting started, let’s talk about the definition of this. By textbook definition, multiple streams of income, pretty much, you’ll make all the money that you need to make when you’re laying by the beach with your laptop, and money just rolls in through passive income sources or money from all over the place from other sources, and you have to do little to no work, right? That’s like the extreme, “too good to be true” example of multiple streams of income.
The more moderate definition of that is that, “Hey, you probably have a job or your primary source of income. You need to have something else, or more sources of income, not just one, but multiple, to fall back to in case something happens to that main stream of income.”
A lot of people believe that and they suggest that you have different businesses going, different opportunities going. Well, that’s a problematic definition, almost like a mutated definition of the real thing. The belief that, if you look at this graph here, this is a time and money graph. As time goes by, your income will go up. That’s a very generous assumption, very optimistic assumption, but it rarely works that way. I’m going to explain to you why that is the case.
“You won’t have to work any more hours in your life.”
So, you believe in this graph to keep going up and up as you add more revenue sources, and the most common ones is the passive income, so-called the real estate, right? “Buy some real estate and the rental income will be passive. You won’t have to work any more hours in your life.” That’s one thing. The other could be the stock market or cryptocurrency, or an online business, or it could be another type of real estate, it could be Amazon store and whatnot. It goes on and on and on, right? But the problem with this model, the main problem is, all of this requires some level of expertise. You can’t just start things and somehow magically have them give you the income that you need.
Money requires expertise
There are a couple of obvious problems with this one. The first one is, you’re just assuming that all of them will make you money, but one thing we know about money is it requires expertise in a certain area for you to make a lot of money. And if you look at historically, all the public figures that are business magnates of people, initially they were experts in one area only.
They built their expertise, they went really, really deep and became the world class at that thing that accumulated a lot of wealth. Then, they started diversifying. Not when they were broke and they just wanted to spread their time really thin, because when you’re broke you have limitations.
Limitations
One limitation is the financial limitation. The second limitation is probably you have time restraints and limitations, right? Because you don’t have enough money and you’re probably working really hard at that job or something else, or you have very little limited time to yourself. And the limitations on the mindset, you just don’t know how to think like a wealthy person. You don’t have the resources. You don’t know the people that would be influencing your decision. You’re not following the right people.
So, when you have those limitations, then on top of that, you’re spreading those limited resources across 10 different things, five, six, doesn’t really matter areas that you don’t really have any expertise on. So, you’re not really going deep, you’re going as wide as possible.
One thing we know about the marketplace, market in general, market pays you if you become a specialist. Think about your general MD versus your heart surgeon. Your heart surgeon usually makes four to five times more money than your general practice doctor. Same thing with your general family dentist versus an endodontist, and some other specialty dentist. That just works the same way in business as well. Look at people around you that are shown as role models in business and look how they started their business, right? Look at Jeff Bezos. He started out selling books online, then once he became the king in that, he started adding more complexity within the same realm, within still online marketplace, right? That’s exactly how wealth is built.
Start slow, as if nothing is happening
You focus on one thing, which is another circle, right? Which is another circle that shows you how the rich people do it. They give their time, if you look at the growth chart of Apple, Amazon, Tesla, any company, it starts slow, as if nothing is happening, and then it skyrockets. That doesn’t mean they have 100 sources of different streams of income. It’s usually one business model that they skyrocket because they go really deep versus these really slim arrows here. You’re staying at the surface level, and you’re going to get paid at the surface level, it’s definitely not a good idea. There is no way in this… Let’s say this is Amazon, right? And this is one of your sources of income of selling books. This is Amazon back then, and you’re your own little Amazon, but you’re not focused on this alone, you’re focused on all the other things. Whereas Jeff Bezos is going all the way in this industry for total domination. Your chances of competing with Amazon or Jeff Bezos even back in the day is slim to none.
Because when you think about it, your attention will…. This is your attention span or the time that you have this is T, right? So, you have certain amount of time per day, and some of that time has already taken away from you. If you’re sleeping eight hours, well that eight hours is gone. If you already have a job and with your commute time, if that’s 10 hours, that’s pretty much 18 hours. That’s your job, sleep. The big bulk of the time already… That’s J, jobs or sleep, is already gone. If it is 18 hours of the day is gone, you only have six hours left to you. Six hours, and probably two hours of that will be spent with eating food, and spending time like taking care of your necessities. Then, you’re down to four hours.
The problem with how most people use those four hours is that they take that and split it across different things. So, you have no focus at all. You spend this time on four or five different things, and thinking that you’re building multiple streams of income, and you’re barely spend an hour a day on the very thing that supposedly will give you… Will save your future and will build you wealth. You’re only giving that the importance of just one hour a day and expecting it to generate income at some point, right?
That’s the problem, and I’ve learned this the hard way, because I bought into I’m to this reality myself. When I was totally broke, I always had this mentality of following wealthy people and trying to understand how they got to where they got to, right? And I’d read biographies, and one of the ones that I admired was the biography of Sir Richard Branson, is a British business magnate who owns 400 businesses. And that was a light bulb moment for me, and I said, “Wow! If this guy owns 400 businesses and that’s how he built his wealth, then I should do the same thing, and there’s nothing wrong with me owning multiple businesses.” At the time, I didn’t own any businesses, I had one full time job. Then, I looked at another role model, which is Tony Robins. Back then, he had, I think, 13 or 14 different businesses. Now he has a lot more, I’m talking about like a decade ago.
And I said, “Well, this kind of… It’s like a self fulfilling prophecy.” I look at these two and say, “I proved my point, and I think I have a valid argument here that I got to have more business.” So, I go start one that starts with like a marketing agency. Then, I start another one with a friend of mine, and we provide coaching services to small businesses. I started a third one, which is totally different with another partner. We were manufacturing mini campers and trailers, which is totally different than anything. And the fourth one is a real estate investment firm buying rental properties. I’m following this exact model only to find out that I’m putting in more than 80, 90 hours a week. I am still not making money, and I’m very miserable because I’m spreading what I don’t have, right? So, I don’t have the money.
I don’t have the time, I don’t have to mental resources, the mindset of a business owner. And I totally misunderstood how someone like Tony Robbins, so and so, Richard Branson got rich, totally missed the concept based on a glimpse on what I thought I caught, and it broke me down. I always have mentors, right? One of my mentors, when I open up to him, I said, “I can’t take this anymore, this model is not working.” He said, “Let’s do this. Why don’t you take a piece of paper, and split it in four, and put each of the company’s name. And below that, just put down how many hours you’re spending on each company, and all the way at the end, just make a list of all the tasks that you’re doing for each company, and all the way at the end, put the dollar amount that that company is bringing you.”
When I did that it was like a day and night different. So, what I thought I was doing versus the reality, three of the companies were not making any money to me while they were consuming the most amount of time. Only one company, that I didn’t really even spend a lot of time on building, was allowing me to generate income generously while I was putting the least amount of time. That was a wake up call for me because that was a paradigm shift for me, because I believed in this model and I said, “I’ll make it successful because all my role models make it successful,” right? But that was a problem, then I got rid of… Literally within three months, I got rid of all the other three businesses, left with one, and within two years going deep into it, we made our first million, right?
Like two years into it. We were looking into this business spending time into it, but it was just too spread out. That’s the problem. I wanted to dispel some myths about the multiple streams of income, because it’s been touted as the best way to build wealth. It’s really not the case when you do not have any streams of income, any solid streams of income. So, the best thing you should do is pick one area, and become the best at it. That’s the only way to build real wealth, because a lot of the times what a lot of people who have the bright shiny object syndrome, they hide behind this concept of multiple streams of income. And I was one of them, right? When you ask them, they say, “Well, I’m an entrepreneur, I own multiple companies, I own multiple businesses. Oh, because on each business I want to generate… I’m generating certain amount of income. So, it gives me the financial security, it gives me the financial blanket. And then, when I’m not working, it’s building wealth.”
That’s another way of saying, “I have this bright shiny object syndrome that when things get hard, I switch businesses, and jump onto the next shiny thing.” That’s exactly what happens, right? How many of you bought some workout machine that was supposed to give you the six pack or make you lose weight? But when the going got tough, like you actually had to wake up every morning and spend half an hour on that machine. What happened? You stopped using it, until you’ve found a new machine that’s supposed to be solving all your problems, and you got that one. A lot of people end up with a home gym that they’re not really using, and they’re not looking great because they’re not utilizing what they paid for. This is the same thing.
We’ve got to face the reality. Most people who believe… Who buys into this model, they just jump from one thing to another because they cannot deal with the reality of you doing the hard work. You got to do the hard work to grow a business, right? So, does this make this entire model obsolete? Absolutely not. Multiple streams of income is a reality, you’ve got to take advantage of it. When do you take advantage of it? When you have this one thing working and it’s bringing you income. It’s bringing you massive income and you’re building wealth through this, right? So, this thing, if I can write, is building income and building a lot of it. So, you’re building cash reserves. At that point, the good thing is, for you to look at other business models that could be, for example, buying real estate properties, and have them bring you residual income or monthly income, buy other businesses, start another business.
But even then, when you look at the wealthy, they don’t do it that way, right? They create multiple streams of income within this realm that they have expertise on, and they look at the subcategories of this. So, it’s not totally separate, this model is wrong. It is within the industry that they’re in. They look at different areas where they can generate money, generate more revenue, right? So, they become… They get better and better at what they do, okay? So, we can still look at that the Amazon model. We still have the amazon.com, but then you become ‘everything store,’ right? And it’s still… He didn’t go ahead and start a real estate company. He stayed within that model, he just added more products, grew the company. That’s why it’s really important to understand which definition of multiple streams of income you are following, because if you’re following the wrong one, it’s not going to lead you to anywhere, it’s going to eat up your resources.
For example, for those of you who know what I do, we train people on how to become business loan brokers, where you can generate six, seven figure income. It’s not just some generic platform where you make money online. It’s very specific, that allows you to go deep. Which pretty much you’re helping people, businesses get access to funding. But within that platform, you have access to multiple products from providing personal loans, providing real estate based loans. If you have investors who are looking to get funding for their real estate projects, you learn about that, credit based loans, and for businesses impacted by what’s going on. If they’re impacted by the pandemic you have pandemic based loans. So, anyone who’s not getting funding through traditional banks, we have 10 plus products that they can use. Each one of them gives you the option to create multiple streams of income while you’re going deep into the same industry, so you can create a mastery. That’s the difference with becoming a generalist, trying to be everything to everybody like, “Jack of all trades and master of none,” right? The good old saying.
Versus choosing an area, becoming an expert in that area and digging… Going deeper and deeper into it with multiple products. It’s like looking at a very strong tree. When you look at the roots of a 20 year old tree, they go really, really wide, but they all come from the same base, right? This is the same thing. Hopefully this makes sense. This is the only model that’s going to allow you to take advantage of this graph right here. As time goes by your expertise will get deeper and deeper, you’re going to grow out your client base and you’re going to make a lot more money. If I look at my community, I see people who just give themselves into the industry always make money faster and in higher amounts and longevity is key, right? They have repeat income coming through.
Whereas if somebody is starting this business today and they jumped, they want to go try some… I don’t know, like e-commerce business. They want to look at no money down real estate business. They want to sign up to 10 other courses and trainings. Their chances of being successful is very low. And don’t forget that this is a self fulfilling prophecy. There’s this whole feedback mechanism. When you fail at something your mind gives you the feedback that, “Oh, this is not really working.” When you’re starting something new that feedback kind of stays there, kind of reminds you, “Oh, the last thing you tried didn’t work,” and then, if you repeat this same process, this vicious cycle, then you fail at that one too, then now you have a pattern. And in your mind, you say to yourself, “Well, I’ve tried all the business trainings out there. I tried to set up so many businesses and none of them work.” Really? Do you buy that yourself? You know that that’s really not the case? You haven’t given your all to it.
I want to be a little blunt here because it’s really, really important when you look at these models. Don’t hide behind the veil of multiple streams of income while your the problem is the bright shiny object. You can’t… You kind of quit when things get tough. Really, if you’re serious about quitting your job or building a real business, well, you got to have the mental toughness to stay with one thing and grow that thing to the sky. Hopefully this was helpful, so if you like videos like this, please like, and subscribe, and comment below the video. And also in the description I put a link to a free training on how to build a business like this as a business loan broker. You can totally check it out, it’s about an hour. So, give yourself plenty of time for you to decide if you want to be a part of this lucrative industry. All right, take care now, bye-bye.
