Smooth road to the riches. Tips for underutilized sales & marketing geniuses. Fix a gap in your career, get an equity in your life, damn it!

So, as years go by you feel that your salary is not growing that much any longer, but amount of responsibilities and stress grows exponentially. Inspirations and passions are gone, same old job brings stable 150-250K a year ,and all you see in your future is many more years like that, slaving for other people, underappreciated, saving $50-100K a year for retirement.

Yes, it will take you 10-20 more years of uninspired, passion deprived life to save $1Mln. If you retire at 50 and live till 80, you will have to live of $33K/year – that’s all you $1Mln is good for, well, unless you wil 401K was taken cared of.

The picture sucks, doesn’t it?

Well, now as you tried the taste of shit, why don’t you get out of it?

We all know that the only way for wealth is building a company and selling it (or IPO it, which these days not as sexy option). If you have tried it and failed, or if no brilliant ideas come to your mind to start up anything, or you just don’t feel like born leader, the obvious choice is to find a company to join as a cofounder, help to grow it and take a piece of action when it’s acquired.

To play right, you have to do your math before making such move.

If a startup you are joining already raised VC funds, your piece of pie will be pretty small. If a company is self funded, have some assets and generated demand, your position in such company will be much better.

So, if you have always worked for salaries and few shares here and there in stock options as employee number one hundred something, and salary is all you know here is your alternative action plan.

• Go to a founder or CEO, sell them on your vision on how you can grow their company,
• join this company in sales or marketing executive role, negotiate $100K-$200K salary plus 1-5% and
• build it up to sell for $100,000,000+.

Let’s look at a specific scenarios…

Let’s say, you have found a cool company and negotiated 5% of equity (that’s probably what we would offer to a VP of Business development that we are currently looking to join us as a co-founder. If you know any superstar that fits the bill, please let him/her reach me at olga @ IdeaMamaAdNetwork.com).

Don’t be greedy on cash. Take $100K and make sure that the company has enough working capital. If a company doesn’t have cash available for salaries, structure your compensation for first year or so as a loan to the company, and have it paid to you when the profitability and cash flow situation improves.

Let’s assume, the company is self-funded.

Using your genius, you take to the level when it has some decent tractions and now needs expansion capital to avoid slow organic growth or slow organic death.

If the company goes for external funding and raised capital form VCs, your stock will be diluted. You now might own 0.5%, but don’t turn your face to mashed potato just yet.

If the company gets sold in 3 years here are few financial outcomes that can appear in your bank account.

Scenario 1. Company A never needed to attract external financing, grew slowly but surely into a good looking small business while remaining self-funded and carrying some debt financing if needed. You own 5% in it. The company was sold with acquisition price:

a)     only $10 million (depending on the company’s assets and industry’s multiples, you most probably only need to generate $1-3 MLN in revenue to sell at this price. If you can’t do that much, why don’t you consider a janitor career?)

b)    $30 million

c)    $50 million

Scenario 2. Company A raised venture funding and scaled fast. You own 0.5% of equity in a midsize company. The company was sold with acquisition price:

a)     $100 million

b)    $300 million

c)     $500 million

d)    $800 million

Now imagine you do the same 3 time during next 10 years (instead of slaving for a daddy) picking the companies that had the same growth and exit strategy (just to keep the calculation simple).

Taking into consideration your salary and exercised stock over 5 years in each company, you have accumulated wealth (not considering taxes) as following.

YOUR INCOME OVER 10 YEARS:

-          Scenario 1a/2a: $100,000*10 [salary] + $500,000*3 [your stock price] = $4 MLN

-          Scenario 1b/2b: $100,000*10 [salary] + $1,500,000*3 [your stock price] = $5,5 MLN

-          Scenario 1c/2c: $100,000*10 [salary] + $2,500,000*3 [your stock price] = $8,5 MLN

-          Scenario 2d: $100,000*10 [salary] + $4,000,000*3 [your stock price] = $13 MLN

Now if you are in your 30th you have 20+ years to play startup game. In this case double all numbers ands retire with $20+ million cash in your pocket and you better have a very big pocket).

So, that’s your roadmap for riches.

The recipe is simple -  just find a cool innovative company with great assets and a visionary founder, and help to take it to the next level. If you can’t make it, then what you current employer pays you anyways? In the current economy your CEO just might decide to save a company from paying you a salary that you might not justify. Then what will you do?

Think now, and think big!

And as you get filthy wealthy, don’t forget to buy me a cup of vodka  (yeah, those Russians!)

Good luck!

…
by Olga Kostrova, CEO of IdeaMama Group | IdeaMama Ad Network | IdeaMamaClub.com |

Connect with me on LinkedIn & Facebook | Follow me: twitter.com/IdeaMama | Skype me: IdeaMama |

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