You can consider Frank Song an expert when it comes to making money. Although he doesn’t boast about his successes, he has already earned millions by building businesses in what he calls “unsexy markets.” Today his companies are worth more than ten million dollars.
He attributes a lot of his initial success to his time in investment banking and private equity. Frank previously worked for Accel-KKR, a top private equity firm located in Menlo Park. At Accel-KKR, he worked with tech companies’ founders to buy out or invest growth equity into their businesses, focusing on non obvious or obscure markets that still provide essential solutions.
Here’s some advice that Frank gave when we asked him for tips on how to make the first million:
- Having good judgment is one of the most essential skills that an investor and business person can have. If a person can make more right decisions than wrong ones, then that person’s wealth can only go up. Frank states that if you’re right, even only 51% of the time, you’ll inevitably grow your assets. The trick is to quickly increase your percentage of right decisions to grow your wealth faster.
- Earning your first million is the most difficult because it requires a lot of patience and self-control. It’s important to have patience and not invest in an asset or business simply because you’re bored or see other people making money. Making your first million is difficult because there is a lot of temptation to “do something” and most of the time, that “something” isn’t a very wise investment. Frank recalls that at one point, he kept most of his money in cash for over two years because there was nothing in the market that was worth investing in.
- When an excellent investment opportunity presents itself, you must invest and strike with as much money and effort as you possibly can. Frank believes that you can’t determine when you’ll be successful because many factors work together to create the perfect environment and situation for success, such as the economy, trends, and consumer behavior, to name a few. He says several factors need to come together for an investment to take off exponentially, similar to Zoom during the pandemic. And when your investment finally takes off, you must be ready.
- Lastly, Frank advises that not investing is better than investing in something you don’t understand. He believes that ordinary individuals looking to earn their first million should put off investing until they fully understand the business and all the risks that come with it. He provides an example that it’s better to lose 2% due to inflation than to lose 20-50% of your hard-earned money because you didn’t fully understand the business or asset.