Category: How to

Frugal while Black

Frugality! I did not even know the meaning of this word until a few weeks ago! Even if I had known the meaning, I doubt it would have been a life objective. Here why I was wrong!

Over the holiday break, a good friend of mine introduced me to Financial Independence. In a few words, Financial Independence is about having F@ck You money. Being able to support your lifestyle without having to work. Sounds like everyone’s dream, right? Yet not many people are ready to do what it takes. The chances that Blacks become financially independent are even slimmer. I heard shocking data recently:

  • The wealth of the top 1% Black families is $1.5 million
  • The wealth of the top 1% White families is $12 million

Let’s put things into perspective $1.5 million is the number I believe my wife and my 2 kids would need to become financially independent. With that amount on a bank account, we should get about $60,000 per year in cash, and that forever. I emphasize the ***forever***! That is until the end of my life and that is for our kids, etc… Yes, the great thing about F@ck You Money is that you pass it on.

How to get F@ck You Money and be set for lives?

  1. Earn more: It is easier than you may think. Probably involves you doing things that you (and many others) may not especially enjoy to do. Anyway, surprisingly this is not the most challenging part of getting F@ck You Money. Keeping reading to learn more…
  2. Spend less: This is much harder than you think! Most people when they earn more, they spend more. It should be ok, but it is not. My personal example. During my glory days in London. My salary would increase by 25% and I would spend an extra 35%. And I was the reasonable guy! Most other people I knew would spend the bonus they were expecting to get 6 months later. Again, in my case, coming from a humble working-class single mom family I was buying stuff/experiences to show my “success”. To belong when I was with my banking/consulting colleagues. To get in and show off in hype clubs. It was futile. But again, after owning little, being rejected from even bad clubs more time than I can recall… it felt good to spend that money. Would it have been as good as being financially independent by age 35… I doubt it!
  3. Make your money work for you: So you did 1 and you did 2. You are better than most people! kudos! However, if your savings are on a checking account that does not pay interest… You won’t become financially independent. Your money should work for you. Following the most basic investment approach, in the long term, you should manage to get an annual interest rate of min 8%.

Want more information? Read what the experts say. This is a link to one of my favourite expert, the mad FIentist. 

Most, if not all of you would say that this idea is crazy. How could I get $1.5 million? Yet, some people will try to become a pro baller, rapper, etc… The crazy thing is that you are much much much more likely to get $1.5million than become a professional athlete. You just have to be ready to get F@ck You Money slowly!

NDA, Non compete, and all other non blah blah blah agreements…

…are just BS

In the era of fake news, it is hard to know what is right and what is not. Everybody is trying to influence everybody, and in the end, you do not know who to trust, especially on social media or even on the news. 

Only when things are written on paper, we are all sure to know what is real or not.  You heard and probably even said: “I have it in writing”, “put it on paper”.  And when you have it on a signed contract, everybody believes they have the holy grail because they know without a doubt what can and can not happen. WRONG.

  1. Non-disclosure agreements
  2. Non compete agreement
  1. Non-disclosure agreements (NDA): In normal people language, it is a secret that people decide to keep.  An example is when Trump got the porn actress Stormy Daniels to keep it secret that he paid her $130 000 to sleep with her. When she breached the NDA, Trump’s lawyers sued her for 20million dollars.  This is an extreme example of lying with a contract.  But it makes the point. While NDA can be enforceable if you break it, the consequences of breaking an NDA cannot be out of proportion.  What is out of proportion? Suing someone for $20million when that same person got paid $130 000 in the first place.
  2. Non compete agreements: Again, in normal people language, it is your commitment that you will not use confidential information to start your own business or work for a competitor.  Usually, employers put in a contract that you can not work for 1 year for a competitor. The majority of the time, that clause is just worthless.  There is only a handful of specific situation an employer can enforce a non compete agreement.  And because of that, if you want to bypass a non compete, there are loads of ways. 

I am not a lawyer, Don’t carelessly break a NDA or a non compete after reading this post. But, be aware that there is a way out. “contracts are made to be broken”.

I SHOULD NOT BE HERE…

But here is why I am

I should not be here. It is not me saying it, it is the statistics:

  • Single Black mom, hospital nurse working night shifts

I should not be here. It is not me saying it, it is the French education system:

  • The career advisor was pushing me towards a vocational degree with “unclear” prospects, at best

I should not be here. It is not me saying it.

  • It is my neighbourhood friend: “Why are you reading this magazine for managers, you can’t become one”
  • It is my family: “You should prioritize job stability, the private sector is too rough”

PEOPLE WHO HAD GREAT INTENTIONS FOR ME. PEOPLE WHO WOULD FIGHT FOR ME DID NOT THINK I SHOULD BE WHERE I AM TODAY.

This is what I heard growing up. And it may be easy to dismiss this in hindsight but when you hear it every day, you see it every day, it gets in your head.

So why am I here? I could not have made it alone. Among the 1000’s of people who expected me to fail, I was lucky to meet a handful of people to guide me in France. Most of them looked like me, but not all. They encouraged me to aim higher, they showed me paths I did not even know existed.

Fast forward 10 years later and I experience a whole new level of support in the US. Instead of a handful of people, I meet 100’s of people like me through Black networks and we all support each other. I realize how much can be done together. And it all started with an idea. “Let’s have a Gala” said the President of the Black Ivy Alumni League.  What I saw next was a pure surprise.  People raising their hands, saying they have a mailing list with thousands, another one saying that they have access to several VIP as they work in PR, other having access to liquor sponsors, and so on. Suddenly we went from an idea to a plan with clear steps to make it real.  This is how many members got inspired by the GM of the Knicks doing a keynote, and many more.

Some parts may seem superficial… but when you heard for the majority of your life that you should not expect to amount to much, and suddenly you see this wave of successful people, who look like you, you get inspired. And I am convinced that inspiration is the key to achieving purpose in life.

I would never do that…

Well, actually you would!

By now you know how much I love understand how people can be manipulated, oups… I meant influenced. No, really I meant what I said.  How to make people do, what they think they would not.

And this is a different take from the last post about we all follow like sheep.  It is not about getting a critical mass of people to do something, so that your mark, oups again, your negotiation partner does what you want him/her to do.  This is the art of influencing someone step by step to do what you want in the long run.

It sounds cryptic. Let me take a concrete example from the book “the spy’s son“.  The most famous US double agent.  He is not only famous for all the intel he gave to the Soviet Union during the cold war, he is infamous for having convinced his son to continue spying for the Soviet Union while he was in prison. Yes, this guy would never get dad of the year award and must be seriously twisted.  What needs to be unpacked is how did he manage that.  He is in prison, and his son who comes to visit him in prison, and knows that his dad is in there because of spying on his own country, would nevertheless continue spying for the Soviet Union.  How did he do it? He did not say “you will pick up where I left it”.  Instead, he first asked his son to do something small, like sending a postcard to an address in the US, then it would be to pick up an envelope, then it would be to transport a small package, then he would start receiving money and before the son realizes it, he would have meetings with the head of the rezidentura (the Russian spy big boss). If you asked the son “give this secret message to a chief Russian spy” most likely the answer would have been “hell no”.  But asking a small, innocent looking favour for his dad, what kind of son would say no…

The reality is “what separates honest people from not-honest people is not necessarily character, it’s opportunity” says Dan Ariely, a professor of psychology and behavioural economics at Duke University in his book The Honest Truth about Dishonesty.  Because behind big lies are a series of small deceptions.  Some people may take advantage of this bias with people to lead them step by step.  My personal opinion is that the saying “this is a slippery slope” may well come from that bias too. Watch out and use with care.

We all follow like sheeps

How to use it in negotiations

Grandpas do not graffiti on walls in their neighbourhood. But what would it take for them to? Yes, you read right. Spoiler alert, the answer is not “this is impossible”.

One of my idol, Malcolm Gladwell, has the podcast called « revisionist history ». In one episode he talks about the threshold for someone to do something that looks “ridiculous”. Let’s go back to your grandpa. If he sees enough people doing graffiti on the walls in the neighbourhood he will go and do it. Why? This is how we are wired, and this is how we survived for so long. If cavemen/women saw one of them eat a berry and die, they would not go and eat the same type of berry. In a similar way, if your grandpa sees everyone tagging walls in the neighbourhood and nothing bad happen to them, eventually even the most rule follower grandpa is going to follow. The key for this to happen is to understand what is the threshold. The threshold is the number of people who have to do something before you do it. This is also what people call the sheep following mentality.

But how do we use it in negotiations? How do we use it to influence people? It is simple, find out how many people it would take to do something to convince the one person you want to influence to also do it. Sounds easy right? The tricky part is the how. This video is funny and very instructive.

Someone who seemed totally crazy at first then becomes normal when everybody joins in, and suddenly the ones not joining are looking odd.

Perfect influencing skills, for horrific reasons

How human traffickers find and control their victims

Not for the light-hearted. Not even for the strong hearted. I am writing this post with the hope that by exposing horrific influencing tactics, people will not fall for them, and will also help people support potential victims.

I am talking about pimping. Actually scratch that word. I am talking about sex traffickers. This is a critical difference. Unfortunately, pimping has too much of a positive connotation. Somehow it is ok to have songs telling the stories of a pimp, or people calling themselves proudly to be a pimp. People even dress like a pimp! Whereas nobody, in their right mind, would brag about being a sex trafficker. And that is the way it should be. And women “working” for sex traffickers are not prostitutes, hoes or whores. They are victims.

With this out of the way, let’s dig into their practices. I listened today to an Ear Hustle podcast. That podcast is produced by an inmate at St Quentin prison in California. They talk about life in prison and sometimes dive into the story of some of the inmates. In this case, a victim of a sex trafficker was talking to an ex sex trafficker serving a 200 years life sentence. Yes, heavy stuff! He starts by explaining how he managed to commit his terrible acts:

  • Find the victim: I was sadly impressed by how smart he was and how well perfected was his approach. He explains that he would first observe. Hang around schools, and look for a specific profile:
    • Low self-esteem. He would judge that by their physic but also their appearance. It was an indication to him that they may need to feel more popular.
    • Not well off. He would note if the girl was wearing off-brand clothes; if she was wearing several times in the same outfit in a week.
    • These would be signs to him that she is a prey, and could be interested in having nice things and feel in demand.
  • Patience. He would take 2 years before he would start trafficking his victim. 2 years. You for sure have many issues if you can prepare such a horrific act for 2 years while building a relationship with a young innocent girl. But he understood that he could not rush it, and also sadly he understood that the wait would pay off. He looked at it as an investment. Buy “nice” things to this girl for 2 years, and get a pay off for the years to come.
  • Keep the victim: That is when the mind game is elevated.
    • Create fear: You may think what could be worse. Unfortunately, people can always be convinced of something worse. Even if it is highly unlikely to happen. Traffickers use worse case scenario. Because they spent so long getting to know the victim, it is not hard to find the hot button that will keep them in check.
    • Create hope: With an end in sight, victims may think they have no other choice than stay and focus on surviving day to day. And you guessed right, there is always a reason to extend the timeframe.

Traffickers are expert manipulators. It is beyond me how they built these skills. My fear is that they were exposed to the basics of sex trafficking at a young age.  And they learned by seeing. Which unfortunately is probably the most effective way of learning.  It is also unfortunate that these basic skills channeled the right way could make these people successful in the (legal) business world.

When you know more than others

and use it right

I was in Berlin last week. A fascinating city. The city of the “unruled”.   Truly a unique city with a complex history. A city that re-invented itself to be one of the coolest city in the world. Yes, you can quote me on that.

During that week, I met 3 fascinating people.  Real sneakerheads.  All in their mid 30’s with a true love and passion for sneakers.  They named themselves “the OG’s”.  I loved the OG’s, I loved their energy for the sneaker culture.  More than 10 years ago, 1 of them was an emerging hip-hop artist, another was a graffiti artist, and the last one was a sneaker collector.  After years of doing their things, they experimented with something new.  Selling second-hand sneakers online.  They started small. Just for fun and see what would come out of it.  To their surprise, the vintage sneakers were selling fast. Really fast.  Long story short, a year later they have a business.  They went from selling a few pairs of sneakers here and there to traveling every month to the US to collect their eBay shopping that they would then resell in Europe.

How did they their business become so successful so quickly? 2 things:

  • They know vintage sneakers better than anyone else.  Fancy people call it “knowledge asymmetry”.  When the average Joe decides to empty his attic and make a few bucks in the process, what he sees is old things taking up space.  The OG’s, on the other hand, see a unique pair of sneakers, from a limited edition that has not been re-edited.  That fancy term, “knowledge asymmetry” means that you can buy something for $10 and resell it for $300 because you know!
  • The OG’s are trendsetters.  Spend enough time obsessing about one thing, you will know it intimately.  The OG’s do not only obsess about sneakers but also about everything surrounding sneakers.  They understand the movement, the trends. In some ways, they can predict what will happen in the streetwear culture better than anyone else in Berlin.  At that point not only you can predict it, you actually can influence the trends.

Let’s recap.  In both cases, they buy low and sell high.  In the first place is because they know better.  In the second case, they create the value by making the sneakers hot.  Here think about the ugly sneakers trend.

The point here is: go beyond information is power.  This is only your first step. Once you have it, milk it as much as you can.  I truly hope the Berlin OG’s will continue to expand their business super fast and dominate that space.