While living in Montreal last December, I visited my friend Rudy to help him with some house preparations for the upcoming winter — their names are changed for privacy’s sake. It was during this trip that I finally met Jack, the infamous son-in-law that Rudy so often complained about who was living with him while saving up to build a house. This challenge wouldn’t be too difficult since Jack was exceptional at his summer job selling pesticides in Delaware, easily making him a six-figure income. The only problem is that he is extraordinarily lazy and imprudent with his finances, choosing instead to spend his income not on building a house, but mid-tier luxury sedans.

But despite his laziness, Jack did have the desire for accruing more money. On his sloppy table were several business advice books, but the one that caught my attention the most was the mere 46-paged “The Millionaire Booklet: How to Get Super Rich” by Grant Cardone. Flipping through it, I was suspicious — since Jack was reading it — but I was willing to research more. Cardone is just one part of the business-centric sliver of the ever-growing industry of motivational speaking. These business gurus may give some a boost of confidence, but they do not give much in terms of entrepreneurial savvy.

Giving What the Public Wants

P.T. Barnum, the founder of circus mainstay Barnum and Bailey, was a notoriously shrewd businessman and an incredible advertiser. Barnum’s bread and butter came when advertising for his highly exploitative freak shows with advertised exhibits among the likes of real-life Mermaids. Obviously, many of these turned out to be hoaxes, but why were so many people fooled into paying? Barnum understood the power of giving the public what it wants, even when the show was clearly less than fantastical. This mentality has even gained him a psychological term named the “Barnum Effect”, where people apply vague generalities specifically to themselves. This theory explains why vague personality tests and fortune-telling are popular.

In much the same way today, business gurus realize what their audience wants — status and wealth. They exploit this desire through image control and giving vague advice, much like Barnum would, and Barnum even wrote his own advice book called “The Art of Money Getting.” Gurus start advertising before they speak. Cardone, for example, has several videos blatantly flaunting wealth such as nice suits, private jets and multi-million dollar real estate.

Dan Lok, another fellow guru, has an entire series where he discusses advice in a Bentley. When the advice actually starts coming, it isn’t actually very helpful. Take for example Cardone’s keystone book “The 10X Rule.” As the name implies, his theory says that setting goals “10 times higher” and working “10 times harder” will get you the success one wants. The summary provides variations of these principles. Setting high goals and working hard is good advice. It is also obvious advice. The advice is so broad, but those unaware can’t help but feel that the advice is tailored to their own specific needs.

Gurus focus more on motivational psychology than the mundanities of entrepreneurship. Videos like “7 Mentalities that Will Make You Poor” or the comically vulgar “HOW TO STOP BEING SOFT” from real-life monopoly man Dan Pena offer advice that can sound and wise. But these videos hardly touch upon critical skills such as effective finance and resource allocation or organizational management. In reality, much more goes into entrepreneurship than simply having the drive and working hard. But don’t worry, the gurus have you covered. You just have to pay. 

Reeling In the Suckers

So you’ve just finished the YouTube advice videos from all your favorite gurus. You feel motivated and want to learn more. Well, you gotta pay a premium and they don’t come cheap. After all, you’ll be a millionaire — or last at least earning six figures — in due time, so the premium is an investment. Let’s say I’m very interested in Dan Lok’s “High Ticket Closers” program. It first starts with a free live masterclass — which is actually prerecorded. The class hypes me up, and I definitely want to be a High Ticker Closer now. I click the link and see the price, and it is nearly $3,000. The price is steep, but it’s part of the commitment.

I eventually graduate from the course, and I am yet again upsold for an even more elite group of high-ticket salesmen. I now get to attend high-class conferences like “Closers in Black,” only to then be upsold again. The chain continues. Dan Lok isn’t the only guru who has similar practices. Kevin David, Tai Lopez and Robert Kiyosaki all follow similar models. The formula is simple — offer free content upfront, then start charging exorbitant prices at regular intervals. These gurus aren’t interested in helping us earn money, but earning money from us.

Avoiding the Guru Rabbit Hole

Jack — whom I mentioned at the beginning of this op-ed — fits perfectly within the demographic that’d be most interested in “investing” in entrepreneur courses. This demographic is composed of young people who are eager to earn money but would like to do so quickly and outside of traditional methods like saving and investing. Chances are that they have seen many ads on YouTube promising high incomes with low effort. The caveats with these programs are many, so practicing judiciousness is key. Researching the backgrounds of the gurus is important. Gurus like Cardone seem to have more credible credentials, but Lok and Lopez are more questionable.

Be aware of the frequent marketing tricks many perform. The most obvious would be the flaunting of goods, but pitches often include made-up time-sensitive discounts, “I am offering this revolutionary course for only $397” — and usually a made-up rags to riches sob story, “I used to be just like you. I had a 9-5 job and made only 45k, and I hated my boss.” But perhaps the biggest red flag would be the high price offer to a special “method” of which the guru has mastered, “What if I told you that you can make 100k in 3 months using Etsy!?” If there is an air of exclusivity in the program, keep guard.

Making money is a good thing, but there is no magic bullet to make lots of it very quickly. Unfortunately, countless internet influencers sell this exact dream. Many people buy in simply because they really want the fantasy to be true, and once the sunk costs are in, it’s hard to pull out. We’d like to think that Get-Rich-Quick schemes are a thing of the past, but as long as there are Jack’s around, they will stay.

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@L_burtonOPed