Page 16 - One Thousand Ways to Make $1000

beans. It will be noticed that all these products have two things in common:
(l) They are articles which can be sold to the general public, and (2) they
repeat quickly. This last qualification is important, because generally you
have to spend an amount equal to the selling price of the first purchase in
order to induce a person to try a product. Your only chance, therefore, of
making a profit on your advertising is the repeat factor of the article. It must
have real merit, and it must have an outstanding feature that will lend itself to
mass exploitation, either over the air or through the press.
Another way to finance a business is to organize a stock company and sell the
stock to friends and local business men who have surplus funds to invest. In
following this plan, it is important to keep the voting control yourself,
otherwise you may find that after you have the business out of the red and
into a money-making position, you have been eased out of the picture.
Incorporate your company for twice as much as the capital required, and keep
51 per cent of the common or voting stock in payment for the idea or the
patents or whatever it is that makes the business attractive. It is better,
however, to finance a business out of its earnings, on a payas-you-go basis,
rather than to organize a stock company. The reasons for this are: (1) When
you sell stock to others you are in effect taking them in as partners. The more
partners you have, the less control you will have over the policies of the
business, and the greater the danger of dissension. (2) Minority stockholders,
unless they are employees, contribute little to a business beyond the initial
capital. There is no reason why they should be given 49 per cent of the
profits. They are entitled to a “rental” for the use of their money, and the risk
they take, but in the case of a successful business, common stock dividends
often represent a return of several hundred per cent a year.
The best way of raising the money you need to start your business, and the
way which in the long run will prove most profitable to you, is to find
something that you can sell. Let the commissions accumulate in a bank until
the balance is enough to enable you to start in a small way. Then, by the
simple process of putting back the profits into expansion, as Mr. Hires did, let
your business grow. In this way you will keep control and will not have to
share an unduly large proportion of its earnings with others.
In this connection you will find on pages 341 to 359 of this book a number of
suggested items which you can sell. If you lack the necessary capital to start
in business, you will probably find something described in that chapter which