Wednesday, 9 September 2009

Success Strategy - Learn to Think Outside the Box

Thinking outside the box is a success strategy used by anyone who has achieved phenomenal success. Outstanding success is certainly not achieved through conventional thinking or even through following conventional wisdom as the following story will illustrate.

Bill Bartmann sat at his kitchen table across from his wife Kathy. It was one of the toughest moments of his life. He was bankrupt, owed $1 million dollars to his bank and what little money he did have for basic living expenses was fast running out.

He was considering sending Kathy and his two daughters to live with his in-laws. He felt humiliated. But Kathy had been with Bill since she was just 11 years old and he was 14. They had been through tough times together as well as great times but they had always faced challenges together.

Despite the gravity of their situation she wasn't about to leave. They had taken a lot of knocks yet she was ready to go yet another round. But she also realised that they had to do something radically different. They had to change their mindset to dig themselves out of the deep hole they were currently in.

So, instead of Kathy packing her bags, she and Bill sat at the kitchen table thinking about what they could do to reverse the dire situation they found themselves in. Bill flicked through the local newspaper looking for opportunities. He didn't see anything he considered viable but he did notice a 2" x 2" ad by the Federal Deposit Insurance Corporation (FDIC) offering to sell bad loans.

Bill thought the idea was preposterous:

"That's the stupidest thing I've ever heard of. Who in their right mind would spend good money to buy bad loans?"

He threw the newspaper away.

The next day as he scanned the newspaper he again noticed the ad by the FDIC. A seed of an idea was beginning to germinate in his mind but he rejected it and again threw away the newspaper.

On the third day though, that idea was starting to grow roots. And, as Victor Hugo said,

"There's nothing more powerful than an idea whose time has come."

He turned to Kathy and said that maybe the people with bad loans were just like them - good people who had fallen on hard times. And that what they needed was a little time to get back on their feet.

He reasoned that if someone could hold onto these loans until the defaulters were in a position to pay that they could make a tidy profit, provided they bought the loans at the right price. And there, in essence, was his business plan for his new business - debt collection.

The thing is, this opportunity always existed but Bartmann had never seen it before because he was focused on other matters. It took a calamity in his life for him to alter his mindset and to start thinking way outside the box. In addition, it was also necessary for him to shift from feeling sorry for himself to start thinking what he could do to improve his circumstances.

In other words, he started asking himself more powerful questions? But powerful questions, far less answers, don't come to you when you're in a state of denial about your situation.

In every adversity there is an opportunity but,

"Sometimes you have to stare adversity right in the eye to see the opportunity."
Bill Bartmann

So the next question was how they would buy these bad loans. After all, they had no money. Kathy suggested that they approach the bank that they owed a million dollars to.

Sounds like a crazy idea but that's exactly what the Bartmanns did.

The bank loaned him $13,000 and Bartmann bought his first box of bad loans. In two months they collected $63,000 and, in accordance with the agreement they had arranged with their bank, they paid off the $13,000 loan, kept $10,000 for living expenses and paid $40,000 towards clearing their million dollar debt.

The next day it was the bank that contacted them. We'd like you to buy more bad loans they told him. This time they loaned him $100,000 and Bill Bartmann bought a bigger box of bad loans. And that's how Commercial Financial Services (CFS) got started.

They paid off their entire debt to the bank within 3 years and over the next 12 years built a business with a revenue of $3.5 billion and a staff of 3,900.

You see sometimes incremental thinking just doesn't cut it. Bill Bartmann is the only person to have gone from bankruptcy to billionaire status. Sometimes you have to think exponentially if you want to achieve dramatic success.

"You really need to get way outside that box and think bigger than you've ever thought before."
Bill Bartmann

And to demonstrate just how much, at the time, Bill Bartmann was thinking outside the box - he was the only person to respond to that original FDIC advert.

Bill Bartmann recently published a new book called "Bailout Riches:How Everyday Investors Can Make a Fortune Buying Bad Loans for Pennies on the Dollar". And you can purchase a copy of this book at the link below:

Bailout Riches Book

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