For 10 years I acted as a mentor to incoming analysts or associates at one of the two investment banks I worked for.
Being a mentor was rewarding and a way to help younger folks navigate the often terrifying waters of a cutthroat work environment.
One of the main pieces of advice I gave was this: You should spend as much time selling yourself internally as you do externally. 50/50.
What I noticed during my career was that those who zoomed up the corporate ladder always seemed to have the strongest networks, regardless of whether or not they were the best producer.
The majority of people hate to network. They believe hard work is enough to get ahead. Unfortunately, from a career and financial perspective, networking is vital if you want to outperform.
There is no true meritocracy.
Disclosure: Financial Samurai has partnered with CardRatings for our coverage of credit card products. Financial Samurai and CardRatings may receive a commission from card issuers. Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.
The Rise And Fall Of A Network
At its core, a network’s fundamental reason for being is for survival purposes. When you have a group of people fighting for you, it’s much easier to avoid getting eaten by lions.
When I started Financial Samurai in 2009, nobody gave me the time of day even after a year of operation. A lack of recognition is why so many blogs or online businesses shut down within a year, despite the low operating costs.
Therefore, I started my own blogging network to help me and other nascent bloggers grow. We promoted each other’s sites over social media, allowed for each other to guest post, helped each other with technical issues, and shared advertising contacts.
At its peak, the network grew to 120 bloggers strong. To pay for my time and the operating expenses of running the network, the network took a 10% cut of all the advertising campaigns mostly I and sometimes other members created. It was a promising business model based on honesty.
The network was going great until one member decided to take the advertising contacts we had accumulated and started her own business creating blog campaigns. Then another member started doing the same.
Because of greed and selfishness, instead of having one strong network, we now had rival factions. Contract prices fell and chaos ensued. No longer was the network mainly about supporting the growth of each other’s sites.
The network created money monsters. I guess I can’t blame the two members who took my idea and created their own mirror image business because they only made about $36,000 a year from their day jobs. To them, they only saw dollar signs dancing around their heads.
Their intense focus on money and lack of loyalty disappointed me greatly. Consequently, I changed gears and decided to spend less time networking and more time writing on Financial Samurai. In retrospect, I’m thankful with how things turned out because running the network began feeling like I was working a day job again.
In case you’re wondering, neither of the two bloggers who took my idea is still around today. They are back to the grind. When you focus on making money first and providing value second, you tend to lose more often than you win.
What people may not know is that I still do an occassional “side hustle” of putting together blog campaigns for financial clients just like in the good old days. I just do so privately to keep things simple. Never stop side hustling! The opportunities are endless.
As for my network’s original intention of helping other bloggers grow, I’ve established The Financial Samurai Underdog Tour where anybody with an underdog story can sign up and tap my platform for exposure. The FS Forum is my new way to keep the camaraderie alive for personal finance enthusiasts.
Build These Five Relationships
It’s always good to network up and down. Those who’ve been around longer have more connections. Those with more connections tend to have more money and power and so forth.
Having 1,000 LinkedIn connections who won’t give you the time of day isn’t very helpful. Neither is having 10,000 Facebook friends who won’t show up to your birthday party.
Once you’ve built a network that won’t let you drown, it’s time to focus on building a network that will help you thrive.
Below are five types of people you should bring into your professional network. They will make you richer and happier.
1) The Life Giver
By far the strongest person to have in your professional network is someone who can give you or your children a job. In order to wield such power, the person must either be a C-level executive, a celebrity, or be the majority shareholder of a business.
Given growing anti-nepotism rules, more companies public and private, are not allowed to hire relatives. But that doesn’t forbid people in power to refer their friends and their friend’s children and push them through the system.
The most powerful Life Giver is the person or family who owns a large privately owned business. They can hire and promote whomever they choose at whatever salary they like. The most powerful family with a private business that comes to mind is the Mars family. They are the makers of M&M candies and are worth over $60 billion. True Stealth Wealth.
Then there are much smaller private companies owned by an individual or partnership that is quite powerful as well. For example, if you own a private online business that generates $1 million in revenue and $500,000 in operating profits, you could easily hire a handful of relatives for $50,000 – $100,000 each.
Your goal is to get to know at least one Life Giver. Once you do, the worst case scenario is that you’ll always be taken care of.
2) The Golden Retriever
It’s sometimes hard to meet C-level executives, celebrities, or private business owners. They tend to wall themselves off because so many people are always asking them for something.
The next best thing is to build a relationship with a Golden Retriever.
A Golden Retriever is someone who makes him or herself extremely useful to a Life Giver. Due to their usefulness, they have joined the inner circle and become one of the Life Giver’s most trusted confidants.
A Golden Retriever could be the executive assistant to the CEO who control’s her schedule. A Golden Retriever could also be the sidekick, like Turtle or Johnny Drama in Entourage who invite whomever they want to Vincent Chase’s parties and movie premiers. The most powerful Golden Retriever is the Life Giver’s spouse.
A Golden Retriever will help you get in the door, but he or she can’t make the final decision. Only the Life Giver can. It will be up to you to impress sufficiently the Life Giver in order to get the job, land the funding, or get invited to fabulous boondoggles.
Your goal is to get to know at least two Golden Retrievers. Once you do, you’ll always have opportunities to grow.
3) The Educator
If you have children, there’s nothing more important than your children. Parents often view education as the key investment they can make. As a result, some parents go to great lengths to ensure their children gain entrance into the best schools.
Although money can buy admission, you need a lot of money to legally buy your children’s way into the best private grade schools and private universities. Legal bribery is in the millions, not in the hundreds of thousands.
The best way to improve your child’s chance of getting into a great school without running the risk of a fine and jail time is to know Educators. Educators are the teachers, coaches, athletic directors, admission officers, school heads, and board members of schools.
If you can procure a letter of recommendation or a good word from an Educator, you drastically improve your child’s odds of getting into a particular school, especially at the lower school levels. Every recommendation counts.
Unlike public grade schools which must accept everyone, private schools can pick and choose the families they would like to join their fraternity. The more the very people who run the school can provide a good recommendation, the better your child’s chances.
Ever since I became an assistant tennis coach at a particular high school, I’ve noticed several people at my tennis club are much nicer to me. They know that even if I, as a lowly assistant coach, can’t help them get their child in, they must at least be pleasant to me out of fear I might say something bad about their family. Getting blackballed is a real thing.
Whether you have children or not, your goal is to know at least three Educators. Once you do, you’ll at the very least diversify your network so that it’s not all just rich and powerful people.
4) The Healer
Health is greater than wealth. Therefore, it behooves you to get to know as many health professionals as possible who you can ask for help.
Imagine if you had friends who are cardiologists, radiologists, optometrists, ophthalmologists, psychiatrists, orthopedic surgeons, podiatrists, ear, nose & throat doctors, nutritionists, physical therapists, gynecologists, nurses, pediatricians, and physical trainers. You could ask them anything and everything.
After getting an MRI on my knee 10 years ago, my radiologist friend whom I’ve known since 9th grade told me to send over the file so he could give me his opinion. His evaluation provided me tremendous peace of mind to not pursue arthroscopic surgery to fix a meniscus tear.
With the soaring cost of healthcare and the dwindling time we get with healthcare providers, it’s good to know as many Healers as possible.
Your mission is to get to know at least four Healers who specialize in different areas of health. Ideally, you are able to befriend a general practitioner, a physical therapist, and a psychiatrist.
5) The Unfiltered Genius
Life is easier if you are extremely smart. You can process information more quickly and make better decisions. Smart people also have the ability to better foresee opportunity where most cannot, which can make them extraordinarily wealthy. Unfortunately, not all of us are intellectually gifted, including myself.
The next best thing to being a genius is to befriend someone who is an Unfiltered Genius. The Unfiltered Genius is your sounding board for all of your life’s big decisions: joining a new company, getting married, buying a house, starting a business, negotiating a severance, and more. He or she will tell it like it is without being afraid of hurting your feelings.
We all have blind spots that lead us to walk off cliffs. The Unfiltered Genius will analyze every issue thoroughly and help you make better decisions in your life.
Everyone needs to know at least a couple Unfiltered Geniuses. If you don’t have one as your friend, it is worth it to hire one. If you can’t afford to hire one, then seek to read, watch, or listen to Unfiltered Geniuses over the internet who are experts in their field.
The easiest way to avoid saying, “If I knew then what I know now,” is to speak to an Unfiltered Genius who has been there before. At the very least, seek advice from your parents.
Not All Relationships Are Created Equal
Quality matters over quantity when it comes to building a valuable personal and professional network. The rich and powerful are getting more rich and powerful. At the same time, technology is enabling us to become more independent.
Go through your existing relationships and see if you can categorize each relationship into one of the five archetypes above. Then, systemically cull the relationships who aren’t real, never reach out, provide no value, or who only take and never give.
You need to proactively cultivate these five archetypes over time. Asking for help out of the blue is a great way to strain a relationship. Always focus on giving first.
If you are unable to befriend one of these five archetypes, then it’s up to you to become one. Once you do, you’ll find yourself naturally getting included into more powerful networks over time.
Recommendation For Leaving A Job
If you want to leave a job you no longer enjoy, I recommend negotiating a severance instead of quitting. If you negotiate a severance like I did back in 2012, you not only get a severance check, but potentially subsidized healthcare, deferred compensation, and worker training. Since you got laid off, you’re also eligible for up to 26 weeks of unemployment benefits. Having a financial runway is huge during your transition period.
Conversely, if you quit your job you get nothing. Check out, How To Engineer Your Layoff: Make A Small Fortune By Saying Goodbye, on how to negotiate a severance. I first published the book in 2012 and have since expanded it to 180 pages from 100 pages in the 3rd edition thanks to tremendous reader feedback and successful case studies.
Suggestions For Business
Start your own website. Every business needs their own website. Here’s a step-by-step tutorial showing you how. Not a day goes by where I’m not thankful for starting Financial Samurai in 2009. I ever would have imagined being able to engineer my layoff from a well-paying job in 2012 to just write and be absolutely free. You just never know what might happen if you try. Back when I started, I had to hire someone for $1,500 to launch FS. Now you can launch in under 30 minutes for less than $50.
Open up a business rewards credit card. If you’re going to have a business, then it’s important to have a business rewards credit card to separate all your business expenses, provide you buyer protection, and give you a healthy amount of rewards. My favorite card is the Chase Ink Business Unlimited because there’s no annual fee, you get 1.5% cash back on everything, and you get a healthy $500 for free if you spend $3,000 within the first three months of opening.
Disclosure: Financial Samurai has partnered with CardRatings for our coverage of credit card products. Financial Samurai and CardRatings may receive a commission from card issuers. Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities. Responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.