Scientists Studied 1,125 Millionaires. This Is How They Got Rich. — Transcript

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1. 0:00Self-made millionaires aren't smarter or
2. 0:02more charismatic. Studies from Harvard,
3. 0:04University of Pennsylvania, and more
4. 0:06show that there are five traits that
5. 0:08every self-made millionaire has. I'm
6. 0:10David, I run FilterBuy, an air filter
7. 0:12company doing about $25 million a month.
8. 0:14I've also spent millions buying other
9. 0:16businesses on the side. [music] And when
10. 0:17I went through this research, a lot of
11. 0:19it lined up with stuff I've actually
12. 0:21lived through over the past decade.
13. 0:22Self-made millionaires on YouTube will
14. 0:24tell you you always need to take risk.
15. 0:26[music] The data says something else.
16. 0:29Take it back to April 2020. The world
17. 0:31had basically stopped, but demand for
18. 0:32clean air exploded overnight. Everyone
19. 0:35was stuck inside, suddenly thinking
20. 0:37about what they were breathing. At the
21. 0:38same time, two things happened that
22. 0:40should have crushed us. Amazon stopped
23. 0:43letting third-party sellers send
24. 0:44inventory into their fulfillment
25. 0:46centers, so our main sales channel gone
26. 0:48overnight. The easy move was obvious.
27. 0:50Pull back, protect margins, take the
28. 0:52short-term profits, and wait it out.
29. 0:54Instead, I did the opposite. I took our
30. 0:57three-to-five-year national expansion
31. 0:59plan and compressed it into 60 days. We
32. 1:02found an empty warehouse in Ogden, Utah,
33. 1:04signed the lease, and put millions on
34. 1:06the line. Equipment, inventory, labor,
35. 1:08all of that in the middle of the most
36. 1:10uncertain economy that any of us had
37. 1:13ever seen. This was not some spreadsheet
38. 1:14exercise. We were making
39. 1:16multi-million-dollar decisions in a
40. 1:18world where nobody knew what was
41. 1:20happening next week, let alone next
42. 1:22quarter. The research on this is pretty
43. 1:24clear. Self-made millionaires score
44. 1:25significantly higher on risk tolerance
45. 1:28than the general population.
46. 1:30millionaires, their risk profile
47. 1:31basically looks like a normal person's.
48. 1:33Money alone doesn't make people
49. 1:35comfortable with risk. Building
50. 1:36something from nothing does. The second
51. 1:38trait is the one that doesn't look
52. 1:40impressive on camera, but it's probably
53. 1:42the single biggest reason some people
54. 1:44make it and others don't. A few years
55. 1:46ago, I decided we were going to bring
56. 1:48our logistics in-house. Freight rates
57. 1:50were exploding, carriers were
58. 1:52unreliable, and on paper, vertical
59. 1:55integration looked like the right move.
60. 1:56So, we bought more than 40 tractor
61. 1:58trailers. We hired drivers. After
62. 2:00spending a few million dollars on this
63. 2:01strategy, I was emotionally invested in
64. 2:04this idea working. And at some point, it
65. 2:06became obvious this wasn't actually
66. 2:08making us better, it was making us
67. 2:09meaningfully worse. I'd walk through our
68. 2:11yard and see rows of trucks just sitting
69. 2:14there. I'd sit in meetings where the
70. 2:15economics had clearly stopped making
71. 2:17sense, [music] and people were trying to
72. 2:19make the numbers work. Admitting that it
73. 2:21wasn't working was painful. Nobody wants
74. 2:23to admit that a multi-million dollar
75. 2:25investment was a mistake. There's an
76. 2:26emotional gravity to staying in it. The
77. 2:29research calls this low neuroticism,
78. 2:31basically emotional stability. Self-made
79. 2:34millionaires score as the most
80. 2:36emotionally stable group in the entire
81. 2:38study. More stable than the general
82. 2:40population. More stable than even
83. 2:42inherited millionaires. And it's not
84. 2:44because they don't feel stress, it's
85. 2:46that they try not to let the stress make
86. 2:48the decision. For me, it's pretty
87. 2:50simple. You narrow your focus, you
88. 2:52simplify the decision, and you gather
89. 2:54information fast, then accept the
90. 2:57reality quickly. The hardest part is
91. 3:00detaching your identity from being
92. 3:02right, because the second that you
93. 3:03decide that admitting a mistake means
94. 3:05you're a bad operator, you'll keep that
95. 3:07mistake alive for years. The business
96. 3:10does not care how emotional I am. The
97. 3:13problem still has to be solved. From the
98. 3:15outside, it can look cold. People who
99. 3:18are wired this way can be hard to be
100. 3:20around when others are panicking. But in
101. 3:22business, when the heat is on and a
102. 3:24decision has to be made, it matters a
103. 3:27lot. Third trait is usually
104. 3:28misunderstood. People hear open-minded
105. 3:31and think it means being scattered or
106. 3:33chasing shiny new ideas. In my
107. 3:35experience, it's the exact opposite.
108. 3:37When I started Filter Buy, the smart
109. 3:39internet playbook was the same in every
110. 3:41podcast, every book, every blog post.
111. 3:43Stay asset light, outsource
112. 3:45manufacturing, avoid inventory, focus on
113. 3:48marketing. I did the exact opposite.
114. 3:50[music] I got obsessed with
115. 3:52manufacturing, with warehouse layout,
116. 3:54where inventory was physically
117. 3:56positioned in the country, even our
118. 3:57freaking box design. People around me
119. 3:59kept asking why I [music] was pouring
120. 4:01money into physical infrastructure when
121. 4:04the cool kids were building marketing
122. 4:06funnels. At the time, honestly, it
123. 4:07probably looked irrational. I realized
124. 4:10pretty early that if you could
125. 4:11consistently deliver [music] a physical
126. 4:13product better than everyone else, you
127. 4:15could build something very durable.
128. 4:17Openness, in my experience, isn't really
129. 4:19about chasing new ideas. It's about
130. 4:21being willing to look seriously at
131. 4:23something other people dismiss as
132. 4:25boring. [music] If you're somebody who
133. 4:27feels like you jump around too much, the
134. 4:29test isn't whether the idea is
135. 4:31interesting, the test is whether you can
136. 4:33still be interested in it 10 years from
137. 4:35now. If the answer is no, it's a
138. 4:37distraction. If the answer is yes,
139. 4:39that's the thing. The fourth trait is
140. 4:41the one that cost you the most
141. 4:43personally, and I think it's the one
142. 4:45most builders quietly struggle with. I
143. 4:47took a $4.5 million loss on purpose.
144. 4:50[music] Here's why. In 2021, I bought a
145. 4:52South Florida HVAC company. The plan was
146. 4:54to accelerate Filterbuy into HVAC
147. 4:56services. On paper, the numbers looked
148. 4:58great, and we moved fast on it. Then, I
149. 5:01got inside the business. Two problems
150. 5:03showed up quickly. First, the financials
151. 5:06weren't as healthy as they'd been
152. 5:07presented. [music] That's painful, but
153. 5:09fixable. The bigger problem was the
154. 5:11culture. The whole thing was designed
155. 5:13around short-term extraction from
156. 5:15customers. You know, selling them the
157. 5:16biggest ticket you can, move on, and
158. 5:19don't worry about whether they ever come
159. 5:20back. That's not how we treat customers
160. 5:23at Filterbuy. We've spent a decade or
161. 5:25more building trust. We realized pretty
162. 5:28quickly we were going to have to decide
163. 5:30what kind of company we actually wanted
164. 5:33to build. The easy decision was to
165. 5:35rationalize it, keep it running, improve
166. 5:37it over time, and eventually recover the
167. 5:39investment. [music] The hard decision
168. 5:41was to tear it apart, absorb a $4.5
169. 5:43million loss, and rebuild it under the
170. 5:45Filterbuy brand with a model that we
171. 5:48actually believed in. The money is
172. 5:50whatever, but admitting that the
173. 5:51original plan was wrong, that really
174. 5:54hurt. The research calls this low
175. 5:56agreeableness. Self-made millionaires
176. 5:58consistently score lower on
177. 6:00agreeableness than the general
178. 6:02population. I want to be a little
179. 6:03careful with this one because this
180. 6:05doesn't mean being hostile or it's not
181. 6:06an excuse to be hostile. It also doesn't
182. 6:09mean being rude. It means conflict
183. 6:11tolerant, willing to make people unhappy
184. 6:14in the short term to be right in the
185. 6:16long term. Telling somebody no on a
186. 6:18small thing today or pushing back on a
187. 6:20small thing tomorrow, you build the
188. 6:21muscle before you need it on the four
189. 6:23and a half million dollar call. That
190. 6:25this is not a trait to romanticize.
191. 6:27People who are wired this way can lose
192. 6:29relationships, but it's a tool and like
193. 6:32any tool, it can hurt you if you don't
194. 6:34know when to put it down. This last one
195. 6:36might be the most important and it's the
196. 6:38one that almost nobody is teaching and
197. 6:40it's extremely difficult to do. One stat
198. 6:43from this study really stuck with me.
199. 6:4575% of self-made millionaires that were
200. 6:48surveyed said that they basically don't
201. 6:50engage with national political
202. 6:52elections. The point isn't that they
203. 6:54don't care, it's that they're very
204. 6:56selective about what gets access to
205. 6:58their mind. Going back to April 2020, I
206. 7:00was trying to make the biggest
207. 7:01operational decisions of my life at
208. 7:03Ogden, Utah compressing a five-year plan
209. 7:05into 60 days and every time I picked up
210. 7:07my phone and opened Twitter at the time,
211. 7:10the world was ending. There were doom
212. 7:12headlines, panic, smart people I
213. 7:14respected were saying the economy was
214. 7:16finished. What became obvious to me was
215. 7:19that every time I scrolled, my mental
216. 7:21state shifted. I was being pulled into
217. 7:24collapse narratives from people who had
218. 7:26no responsibility for my business. So, I
219. 7:29deleted Twitter off my phone. At the
220. 7:31time, it felt extreme. Everyone else was
221. 7:33consuming information 24/7. The external
222. 7:37world was starting to decide what
223. 7:38occupied my mind all day and that just
224. 7:42wasn't going to work. The researchers
225. 7:43call this an internal locus of control.
226. 7:46Basically, believing that your results
227. 7:48come from your own actions, not from
228. 7:50outside forces. While people are
229. 7:52obsessing over what the Fed is doing,
230. 7:54they're neglecting customer experience
231. 7:56and hiring, [music] product quality, the
232. 7:59stuff that actually drives the business.
233. 8:02So, here's something practical that you
234. 8:03can do after this video. Make a list of
235. 8:06every information source [music] that
236. 8:07you check in a normal week. News apps,
237. 8:10Twitter, Instagram, market tickers,
238. 8:12competitor [music] sites, all of it.
239. 8:13Then run each through one question. Does
240. 8:16this directly improve my ability to
241. 8:18execute on what I'm building? If the
242. 8:21answer is no, you got to cut it. And
243. 8:22here's the philosophical version [music]
244. 8:24of this. The more of your waking energy
245. 8:26that you spend on things aligned with
246. 8:28where you want to go, the higher the
247. 8:30probability that you're actually going
248. 8:33to get there. Some people call that
249. 8:34manifestation. I think it's more
250. 8:36practical than that. If you focus on one
251. 8:38problem for 10 years, your brain starts
252. 8:40seeing patterns that other people simply
253. 8:43miss. Here's the part of the study that
254. 8:46honestly surprised me the most. The
255. 8:47researchers also measured happiness. The
256. 8:50study suggests that self-made
257. 8:51millionaires report higher happiness
258. 8:53than inherited millionaires. And that
259. 8:55[music] happiness barely scales with
260. 8:57wealth past a certain point. I think I
261. 8:59know why. When you build it, you become
262. 9:01somebody in the process. The money is
263. 9:03almost a side effect. The real product
264. 9:06is who you became while you were
265. 9:08building it. That's why the boring
266. 9:10builders win. They're not chasing the
267. 9:12outcome. They become somebody capable of
268. 9:15building meaningful things repeatedly.
269. 9:17If you're quietly building something
270. 9:19real, and it feels slower and less
271. 9:21glamorous [music] than what the internet
272. 9:22rewards, that doesn't mean that you're
273. 9:24behind. It may mean you're playing the
274. 9:26[music] right game. And if you've always
275. 9:28felt slightly out of sync with normal
276. 9:30culture, maybe that isn't a flaw. Maybe
277. 9:32that's the exact wiring [music]
278. 9:34required to build something meaningful.
279. 9:36If you want to know what kind of
280. 9:37business someone wired like this should
281. 9:39actually be building, watch my video on
282. 9:41the six boring businesses that always
283. 9:44make millionaires right here.