For those of you who chose the one million dollar option, the story pretty much ends there. Maybe you’ll go on to start a business, maybe you’ll go on to invest it, or you could spend it on a lavish vacation to the Caribbean or gamble it away at a casino in Las Vegas. The point is, very few people with a one million dollars gift ever spend it modestly; go ask any lottery winner!
Let’s focus on the reasonable few who decide to start a business with their one million dollars. If you’re one of them, it’s likely you won’t be modest in your spending too. You’ll want to spend a huge chunk on marketing and advertising so you can start the business with a bang. You will likely want to launch a state-of-the-art website, hire some experienced MBA managers, and get an office space with an excellent view in the heart of a big city. My point is, with a million dollars in startup capital, there’s a huge and irresistible temptation to start up with a big bang. As long as there is something out there that’s necessary for your business, even if it’s not very important, you’re very likely to spend because you have a million bucks in your pocket!
Let’s now look at the ‘foolish losers’ who decided to take my one penny with the option of doubling it every day for thirty days. While this option may look like a wild goose chase on the surface, you should take a close look at the table below to see how much you’ll end up with after thirty days if you double one penny every day.
Yes, you saw that right; your eyes are not playing tricks on you! Over five million dollars! That’s five times the one million dollars you hastily took from me. Don’t take our word for it, you can do the calculation again for yourself to confirm these figures. Do I hear you thinking: ‘I should have taken the one penny option?’. Yeah, you really should have because you totally neglected the ‘compounding principle’. The way this principle works is nothing but amazing! Nobody would have ever thought that given the opportunity to double a penny, it would grow to over five million dollars in just thirty days; not five, ten or fifty years! While this outcome is amazing, the journey from one penny to five million dollars is the really cool part.
The amazing journey from one penny to five million dollars!
I shouldn’t really call this a journey, we should call it an ‘odyssey’. An odyssey is a very long, tough and tiring travel. Remember the movie where it took the hero, Odysseus, ten years to get home to Ithaca after the battle of Troy? Ten years of fighting monsters, losing his ship and men; and haunted by memories of his beautiful wife at home. At some point, you would think he would never make it home. But he did! Just before I turn this article to a history lesson, let’s go back to the miracle journey of our ‘one penny’.
If you take a close look at the chart below, you’ll notice that after nearly three weeks (21 days), our one penny grew to just about $10,000; that’s only nine days left to Day 30, the final day. For those 21 days, you would have been putting all the effort and hardwork to double your money. The thing is, the money actually doubles, but not fast enough. In fact, if you were told that your $10,485 (on Day 21) would grow to over $5 million within the next nine days, I’m so sure you would never believe it. But it does!
From Day 23 (when the money is just about $41,000), something very interesting and dramatic happens. The doubling rates pick up and grow so fast in just seven days that the money hits $5.368 million by Day 30. Truly amazing! It’s not the amount of money at the end of this journey that shocks me; it’s the nature of the journey itself! Nothing interesting really happens throughout this journey until it nears its end. It’s more than enough time for a large number of people who started this journey to quit. It’s like you’re working hard and nothing seems to be paying off and then suddenly, from out of the blues, you’re rich!
For the doubters and critics, we acknowledge that this little experiment assumes that it would take the same amount of time and effort to double a penny as it would to double $41,000. The truth is, it could take 30 months or 30 years. The main point is that all you need to do to grow one penny into five million bucks is to double it 30 TIMES! Depending on your situation and the opportunities you exploit, doubling a penny thirty times can take a short or long time. Case closed!
Why does the ‘one-penny miracle’ not work for many of us?
This is one question that has gone through my mind a thousand times. If it is so obvious that with some patience, hardwork and focus, we can turn our little pennies into millions of dollars, why are we not all rich yet? Good question. I have given this puzzle some thought and come to the following conclusions:
1. Too many of us want immediate results
This is exactly the reason why many of us would have chosen the one million dollar option at the beginning of this article. We live in a world of quick results, fast cash and easy money. We don’t want satisfaction tomorrow or in the next five minutes; we want it NOW! Very few people nowadays want to sow a small seed and wait for it to grow into a huge tree with hundreds of fruits that contain thousands of seeds. Rather than plant that small seed, we want to eat it today!
I am tempted to call it ‘greed’ but no, it’s just who we are, it’s the nature of a 21st century computer age. This is the same weakness exploited by conmen and scam artists (popularly known as ‘419’ in my country - Nigeria). These guys know that people are drawn to opportunities and get-rich-quick schemes and will pay anything to own a million dollars today.
But as our small experiment shows, even something as negligible and overlooked as a penny can, with the right opportunities, grow into a staggering amount of money. Money spent today is gone forever, but money invested, saved or used to start a business has the chance to grow into something beyond your wildest imaginations. This is exactly the promise and principle that makes the one penny miracle work.
2. We think a penny is too small
The second reason why you chose a million dollars at the beginning of this article is because you thought the alternative (one penny) was too small. Even after I sweetened the deal by offering you the opportunity to double the one penny every day for thirty days, it still didn’t change your mind. Why? You simply thought a penny was too small to make any serious impact. I’m glad you think much differently now.
The ‘too small’ excuse is the main reason why many of us never consider to save, invest or start a business. We think the capital we have is too small. We believe the amount of money we earn at our jobs is too little to amount to anything even if we saved it. Well, I’m glad you now know you have been wrong. Little drops of water can, and will, make a mighty ocean if you give them enough time to keep dropping. If you have a brilliant business idea and have always wanted to start a business, you have an amazing opportunity to start small with whatever little you have. This is exactly how successful African entrepreneurs like Lorna Rutto, Eric Muthomi, Patrick Ngowi, and the Jobberman trio started. They all started small!
Starting small gives you the invaluable opportunity to make small mistakes and suffer small failures, gain some experience and get better while you grow. The whole idea of starting small is that you can afford to make small mistakes without going bust. The guys who start a business or investment with a million bucks cannot afford the same experience. They’re often too scared to take risks, but you are not. What have you got to lose? You’re small!
Do you want a penny or a million bucks?
Now that you know what a single penny can do, which are you going to choose? It’s important for us as Africans to change our mindset about getting rich and becoming successful. Now you know how powerful a penny can be, now you know how tough the journey is and that results will only start to show at the very end of your entrepreneurial journey. I don’t want that chart you saw to ever leave your head. You have seen proof that the plan works. Plan your work, and then be patient and focused while you work your plan.
The Get Inspired section of this website contains profiles of several young and enterprising Africans who started small and are reaping the huge benefits, successes and global awards today. You should also look through our catalogue of small business ideas to discover opportunities you can start exploiting today!
Do you have any experiences with starting small? Do you agree or disagree with this idea and will still choose the one million dollars instead? We would love to hear from you! Please leave a comment in the section below and share this inspiring article with your friends using the Facebook, Twitter and Google+ buttons below. Someone out there may desperately need this information.
To your financial success!