Flashcards for:
How to Make a Billion Dollars

Focus on buying, leveraging, and growing assets efficiently while using strategies like loans to scale operations profitably, to ultimately build substantial wealth.

With a $5M profit growing 20% annually, the earnings can grow to ~$40M in 5 years. If the company is valued at, for instance, 10x earnings, a $40M profit translates to a $400M valuation.

You should consider high margin, large market, scalable business opportunities that are not capped at $100M annual revenue and have long time horizons.

Owning a billion dollars means having assets worth a billion dollars, while making a billion dollars refers to earning that amount in revenue or profit.

Thinking from an institutional investor's perspective involves focusing on ROI, long-term asset valuation, and employing strategic, financially sound decisions to ensure significant and sustained returns.

Providing substantial value could involve selling a product or service that can make someone else $100k, allowing you to charge $10k per sale.

Aim to generate weekly profits of approximately $1.5M, which would accumulate to an annual profit of ~$300M.

Leverage and loans allow you to acquire significant assets with relatively smaller investments which, when grown successfully, can lead to massive returns and asset appreciation.

Setting large incremental goals, such as aiming for a $10 billion or $50 billion value, helps keep focus and direction towards substantial, impactful achievements which are necessary to accumulate significant wealth.

Tangible goals break down the daunting objective into manageable, measurable steps which provide clarity, focus, and a structured path to achieving substantial financial milestones.

Initially thought it required making a billion annually, then taking home two billion over a lifetime, and finally realized it entails owning assets worth a billion dollars.

Institutional investors focus on the return on investment by managing large sums to ensure guaranteed returns, often analyzing and valuating assets based on their ability to generate predictable and sizable returns.

The company's value increases from $50M to $60M because with a 10x earnings multiple, every dollar increase in profit results in a tenfold increase in business value.

EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. It is significant because it is a metric used to evaluate a company's overall financial performance and profitability, essential for valuing and growing a business to reach billionaire status.

Businesses with long time horizons tend to offer more stable growth opportunities and better scalability, providing a reliable pathway to substantial asset accumulation and wealth generation.