The Billionaire Mindset: Secrets of a Successful South African Entrepreneur

By Daniel Strauss

What sets the rich apart from 'normal people'? A mindset.
In The Billionaire Mindset, Daniel Strauss, the Strauss in the investment firm Stocks & Strauss, and a highly successful venture capitalist explains how to adopt this life-changing new mindset. He shares his secrets of success, including how to access capital, where to find the right people to help you reach your goals, and explains how to free your mind from self-imposed limitations, so that you can also think like a billionaire.

• Language: English
• Publisher: Tafelberg
• Release date: Feb 12, 2021
• ISBN: 9780624090359

Daniel Strauss

Daniel is 'n Suid-Afrikaanse entrepreneur en waagkapitalis. Hy is die Strauss in die beleggingsonderneming Stocks & Strauss. Hy het 'n B.Ing. (Bedryfsingenieurswese) en MBA aan die Universiteit van Stellenbosch verwerf. Hy en sy vrou, Rolene, het twee kinders en woon in die Kaapse wynlande. Dink soos 'n miljardêr is Daniel se eerste boek.  

Book preview

9780624090359_FC.jpg

Daniel Strauss

THE BILLIONAIRE

MINDSET

Secrets of a Successful

South African Entrepreneur

Tafelberg

To my sons:

Make this mindset your own.

My journey was not easy,

so yours can be.

TO THE READER

You are very likely already an entrepreneur. Or, if not yet, you yearn to be one. You want to start your own business – a business where you are the boss.

I have a good idea of what you are going through. I have experienced it myself. I am also an entrepreneur and my business happens to be investing in other entrepreneurs. I am the Strauss in the investment firm Stocks & Strauss. We invest in small and medium-sized enterprises with the aim of growing them into larger businesses. To date, we have invested in more than 50 private businesses. I have made plenty of mistakes but also achieved some noteworthy successes. I want to share with you what I have learnt.

My life is a strange one. I might start the day by lecturing to a group of MBA students at a top business school. Thereafter, I might drive to one of our portfolio companies to have a meeting with the chief executive officer (CEO). But before going to the CEO, I might sit down with the workers for a round of dominoes or take a walk on the factory floor to have a chat with some of the workers. Next, I might have a meeting with a wealthy investor or take a call from a celebrity in need of advice. In the evening, my wife and I could very well be at a gala dinner sharing a table with well-known personalities from business or the arts. It is a busy life but an exciting one.

I mix with people from many walks of life and that gives me a unique perspective. While growing up, I thought the rich must be smarter or have skills or knowledge that I could never attain. Having now spent enough time with the wealthy, I realise that they are people just like you and me.

But the ones who went from penniless to rich had something I did not, at least not while growing up. They knew how to think above the line. They have the mindset of a billionaire – and that is what this book is about.

I recently had a focused conversation for about an hour with a well-known billionaire who is a shareholder and director of several multinational organisations. Three things stood out. Firstly, he has a mindset that ‘everything is possible’. For him, clearly, no project or endeavour is too big or daunting. There is always a way to reach a goal. Secondly, this mindset is not rooted in his wealth or the assets of his companies. It stems from the confidence of knowing where to find the right people and resources to reach that goal. Lastly, billionaires rarely, if ever, use their own capital to attain their goal. The man I met explained how deals are structured and who provided the funds. To my surprise, his own capital was rarely part of the funding discussion. Capital, contributed by willing investors who trusted this billionaire, formed part of every single deal, project or company we discussed.

Many entrepreneurs use the excuse that they don’t have access to capital. We should rather focus on our networks, knowledge and resourcefulness, and free our minds from our limitations, which are mostly self-imposed. In this book I will help you break free from your constrained thinking.

One of the aims of this book is to raise the thinking of a sufficient number of people to enable a revival in the business world. Such a revival of growth and rise of a new breed of business leaders will take the world forward in a conscious and sustainable manner.

The methods, mindsets and concepts we will discuss in this book work like a scalpel in the hands of a surgeon. They can do immense good, but they can also do damage. Use these powerful tools with care and to make the world a better place.

Chapter 1

BOARDROOMS AND BEAUTY PAGEANTS

I was in a boardroom listening to analysts as they ran through an investment presentation. Now this may not sound like the most unusual place for a venture capital entrepreneur to find himself. Only, this boardroom was in Shanghai. And everyone was speaking Mandarin.

I was barely thirty and I had hardly any money.

My mentor, a Chinese man more than fifteen years my senior, occasionally leaned over to translate parts of the presentation, because my language skills went only as far as the English and Afrikaans I had learnt in the Northern Cape.

The analysts were pitching to invest in a luxury wristwatch maintenance business. The likes of Rolex, Cartier and Patek Philippe do big business in China, and the company that the investment firm was looking at serviced and repaired the beautiful timepieces of the rich and famous.

My mentor had earlier introduced me to the rest of the boardroom as an investor from South Africa. In truth, I had just recently started acquiring assets using mostly ‘sweat capital’ – helping entrepreneurs with their businesses, solving a problem here and there, in exchange for a slice of equity. I was gradually building a portfolio of private investments, but my holdings were still modest.

Then they asked my opinion.

Now, how did a farm boy who grew up next to the Orange River come to be at this meeting? And why?

Before I answer that question, let’s just quickly get a few things out of the way.

I have spent most of my adult life trying to find out what makes people successful. I have put in serious work and invested hard-earned money in different forms of education to get to the answer. I’ve done the legwork, so you don’t have to.

In the process, I have been fortunate enough to come across some incredible mentors. Their teachings have opened my mind. I have learnt ways and methods to achieve remarkable things, which I have since supplemented with my own reading and experience.

Now, you may ask whether I came up with the ideas in this book all on my own. No. You have my mentors to thank for guiding and teaching me about many of these concepts – you may even recognise some of the principles from other sources.

But – and this is the important part – I have been applying these methods in the real world. I know what works. And that is what I will be discussing in this book. I’m not going to bury you in theory and approaches that have mixed results. My purpose is to give you only what you need and only what works.

In this book I intend to use mostly anonymous examples. For several years I have worked behind the scenes to help some well-known personalities and entrepreneurs reach their full potential. I realise that I run the risk of appearing to detract from their achievements if I were to identify them. The exception, of course, is my wife, who gave her full consent and whose identity a simple Google search will reveal in any case.

But first, let me tell you where it all began.

Small-town boy

I grew up in a town that most people have never heard of. If you can’t point to Keimoes on a map, I won’t hold it against you. Tucked away in the northwestern corner of South Africa, it lies on the Orange River, about 40 km from Upington and nearly 800 km from Cape Town. Keimoes was small enough that you absolutely had to treat everyone in such a way that you could still look them in the eye the next day.

Depending on who you believe, the town got its name either from the Nama term meaning ‘great fountain’ or the Korana word for ‘mouse nest’.

Our house stood on farmland some 4 km out of town. In other parts of the country, people would call 4.5 ha a proper farm, but not in the Northern Cape. Farms in the area typically cover as much of the earth’s surface as some independent states, and sheep wander across vast expanses of land in search of grazing.

The Orange makes it possible to grow fruit and vegetables in a region that would otherwise be too arid and desolate. From the air, you can see the green of the vineyards hugging the river as it snakes towards the border with Namibia and ultimately the Atlantic Ocean. Our home was nestled in-between those vineyards.

I didn’t grow up with money. My father was the youngest of nine children. So he borrowed heavily to buy the modest piece of land on which we lived. Interest rates were high for most of the 1980s and 1990s, so to get ahead was tough. Our house was run down and we were constantly working to improve the old building we lived in. We never went hungry, but we definitely did not qualify as ‘rich’.

Most of the kids my age, especially those from families with means, left for boarding school at more prestigious institutions in other towns. I stayed in Keimoes for both primary and high school. And while they practised for athletics on tartan or grass circuits, I ran my laps on gravel tracks. I longed for the same opportunities, but made do with what we had.

Not unusually for a small-town boy, I had my own vegetable patch. I grew carrots, tomatoes and onions, which I sold to the greengrocer in town. As for learning about running a business, I wouldn’t say it taught me much.

And growing up on a farm also did not teach me much about business. The thing with agriculture is that you produce something and you sell it. It is different from, say, retail, where you can understand the real mechanics of a business – you have to really apply your mind to marketing a product to make it attractive to potential buyers. With agriculture the market is always there; it is just the price that varies. But I wouldn’t have been able to tell you that while I was growing up.

I was just a boy sourcing seeds and fertiliser for my garden from my father’s supply in the shed. So my little vegetable venture had only turnover and no expenses and churned out a profit. Imagine finding a business like that in the real world!

I also raised chickens and rabbits, but not for any real economic gain. Mostly I would spend my days on the farm with our collie. Or I would go off riding on my bicycle for hours. I often chopped wood, hacking large logs into smaller pieces.

When I went for drives with my father, our conversation wouldn’t necessarily touch on the business side of things, but he did talk to me about tax or how he was planning to expand. He also always made it clear that just because someone drives a fancy car or lives in a big house, it does not mean they are wealthy.

Even though my father never had any tertiary education, he is the wisest person I know. I talk to him daily and always ask for his advice before taking any big decision. I know that he has worked really hard to provide for his family and I am grateful to have the wonderful parents I have been blessed with.

Around the time I was four or five years old, while I was staying with family in Cape Town, my aunt took me along with her when paying a visit to friends. The host was Renier van Rooyen, who had a luxurious house in Durbanville. As founder of the low-cost retailer Pep Stores, he was already a legendary entrepreneur. But I didn’t know much about him at the time, and when we arrived at the sprawling mansion, I said something like, ‘Wow, Tannie, are we at a palace now?’

It was the first time, and the only time during my childhood, that I came into contact with someone who was truly rich. I remember finding it strange that a house could have so many unoccupied rooms. And it would be more than two decades before I could figure out how Van Rooyen managed to build all that wealth.

Apart from selling vegetables, my only experience of earning money had been in Hartenbos, while on holiday. My first job was selling newspapers, and I was still in primary school at the time. Those of us distributing the newspapers used to walk to a central point where we would each be handed a hundred copies to sell that day. I loaded my consignment onto a makeshift newspaper wagon, which we had built by mounting a fruit crate on the wheels of a broken toy.

I had a designated neighbourhood where I would knock on every door to ask if the residents wanted to buy a newspaper. Some people were rude, others were friendly, some tipped and others didn’t.

After all the papers had been sold, I would walk back to the central point to empty the contents of my money bag onto a tray. Our ‘employer’ deducted the cost of the morning’s hundred papers, usually taking all the notes and the big coins from the tray, and allowing me to keep what was left.

Selling newspapers was hard work and some of the rude remarks really stung, but I had a very distinct sense of accomplishment as I walked home, my bag heavy with cash. Even though the weight of the bag was due to the mass of small coins, which didn’t really amount to very

Reviews for The Billionaire Mindset

[Johannes Van Der Spuy · Rating: 5 out of 5 stars]

Excellent and well written. This is a book I will many more times in future as I can already pick up that it will provide valuable insights at every stage of my journey through life and business.