Whilst it’s very attractive to dream about being an early investor in “the next big thing” I see a LOT of people making a massive mistake due to either the fear of missing the wave or the greed of wanting to get rick quick.

Getting involved in a “start-up” business is certainly great fun and carries with it the possibilities of massive upside rewards but the reality is almost ALL start ups FAIL. This is even truer for internet based businesses where the start up risks are far smaller and hence the potential for the owners just to “give up” is much higher. They are not risking anywhere near as much as the owners of a traditional bricks and mortar business.

So if you’re tempted to get involved with a start up business (for example a network marketing company) because of all the “hype” and “buzz” then take a step back and look at the realistic chances of success and stop your heart from ruling your head.

This is a lesson I think that more people need to learn today and one that I have personally struggled with as well over the last 5 years or so.

Imagine you were investing your time and money in exchange for stock options in the company. It’s a HIGH RISK penny stock. So do NOT invest your life savings into it!

Obviously, there are some stories of people who missed out on a fortune (e.g. one of the founders of Apple sold his shares within a year of being given them for about $200 if memory serves me right and if he had of held on he would have been a multi-millionaire today) but in general there are FAR MORE stories of people who lost everything by backing the wrong horse however, most of those stories don’t get much airing – who would want to admit their failings in public?!

My simple tip therefore is if you are going to invest time and/or money into a new venture, make sure it is NO MORE than 2% of your “bank” or money and time e.g. 30 minutes is 2% of a 24 hour time bank.

By all means “invest” in a risky start up, but get the balance of investment right. If it pays off then even a 2% investment will stand you well for the future. The reality is though that in 99.9% of cases, your 2% investment will completely vanish.

If you want to make real money, keep 95% of your time and money invested in businesses that are in the MOMENTUM PHASE of growth. They will have proven sales and systems and the objective of actually making money is far easier and the odds are greatly in your favour.

And to finish off this post, here’s an image I’ve just created which illustrates what people like Richard Koch (multimillioaire) have been saying for YEARS…

4 stages of growth chart mystery