International Law

Why You Don't Get Rich Quick

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Seth Godin makes a mistake.  

He identifies business opportunites as things like: "raising ostriches, or timing the market or investing in tulips--there's a long history here." 

Ideas that appear absurd on their face.

But he follows this mistake up, with a very good insight about why people buy business opportunities, when the underlying business has little or no value.

What's being sold here?

It's not riches, because if the riches were automatic, the seller would just hire people, right?

Why make 1,000 people into millionaires if you can just hire 1,000 people and be a billionaire?

No, it's the belief in riches, the thrill of finding just the right deal, the challenge of getting a relative to loan you money one more time.

It's the frisson of excitement from sending in the money, the rush of impatience that follows as you wait for the package, and then the scary moment when you open the package and come face to face with your dreams.

Of course, your dreams are rarely what you hoped (how could they be?) but soon, you'll be back for more. It seems that being an opportunity seeker is about seeking, not finding.

Your dreams are rarely what you hoped.

A pith rendition of Daniel Gilbert's observation that the future when seen from the past is always different once you arrive.

But biz ops are more than tulips, rare birds, or emeralds sold in pyramid fashion.

Richard Solomon, commenting at BMM, points out that the latest offering from Starbucks, the Seattle Coffee Company franchise, is a bitter brew.

SBC will not create competition for Starbucks retail units in current conditions because the SBC franchise model won't work, and the investment capital provided by the FranWad suckers will simply go into Starbucks' general revenue.

There is a short interim - a few years - in which Starbucks can fleece sucker investors with this SBC deal. When normality returns, the SBC folks will be in bankruptcy and Starbucks can then pick up the demand for its supply commitments with its own stores, and will also have had time to adjust its purchase commitments to meet its then demand profile

Think about this for a moment.  Starbucks closes downs stores which couldn't make money, some 500 to 600 stores.  Then they want to sell to you the opportunity to sell coffee, a business that they just retreated from.  

You just might be a Franwad if you think Starbucks is going make your dream come true.

Full post as published by Misleading Advertising Law on February 22, 2009 (boomark / email).