Book Excerpt: Rich Dad’s Before You Quit Your Job – Part 2

The real secret to making money and reaching financial independence is not staying an employee, but starting a company and quickly developing it. Rich Dad’s “Before You Quit Your Job” is for aspiring entrepreneurs who need to know how to take those first crucial steps.

Book Excerpt:Continued from Page 1
Rich Dad’s Before You
Quit Your Job: 10 Real-Life Lessons Every Entrepreneur Should Know About Building a Multimillion-Dollar Business
by Robert T. Kiyosaki and Sharon L. Lechter C.P.A.
ISBN: 0446696374
Order this book from


If this story about working long hours or failing if unsuccessful and possibly failing if successful or jumping out of a plane without a parachute and bouncing frightens you, then being an entrepreneur may not be for you.

But if the stories intrigue you or challenge you, then read on. After finishing this book, at least you will have a better idea of what entrepreneurs need to know to succeed. You will also have a better understanding of how to create, design, and build a business that grows with or without you, and possibly makes you rich beyond your wildest dreams. After all, if you are going to jump out of a plane without a parachute, you may as well win big if you are going to win at all.

The Job of an Entrepreneur

The most important job of the entrepreneur begins before there is a business or employees. The job of an entrepreneur is to design a business that can grow, employ many people, add value to its customers, be a responsible corporate citizen, bring prosperity to all those that work on the business, be charitable, and eventually no longer need the entrepreneur. Before there is a business, a successful entrepreneur is designing this type of business in his or her mind’s eye. According my rich dad, this is the job of a true entrepreneur.

Failing Leads to Success

After one of my demoralizing business failures, I went to rich dad and asked, “So what did I do wrong? I thought I designed it well.” “Obviously you didn’t,” rich dad said with a smirk.


“How many times do I have to do this? I’m the biggest failure I know.” Rich dad said, “Losers quit when they fail. Winners fail until they succeed.” Shuffling the papers at his desk for a moment, he then looked up at me and said, “The world is filled with want-to-be entrepreneurs. They sit behind desks, have important sounding titles like vice-president, branch manager, or supervisor, and some even take home a decent paycheck. These want-to-be entrepreneurs dream of someday starting their own business empire and maybe someday some of them will. Yet I believe most will never make the leap. Most will have some excuse, some rationalization, such as, ‘When the kids are grown.’ Or, ‘I’ll go back to school first.’ Or, ‘When I have enough money saved.'”

“But they never jump from the plane,” I said, finishing his thoughts. Rich dad nodded.

What Kind of Entrepreneur Do You Want to Be?

Rich dad went on to explain that the world was filled with different types of entrepreneurs. There are entrepreneurs who are big and small, rich and poor, honest and crooked, for-profit and not-for-profit, saint and sinner, small town and international, and successes and failures. He said, “The word entrepreneur is a big word and it means different things to different people.”

The CASHFLOW Quadrant

As I mentioned in the introduction, the CASHFLOW Quadrant explains that there are four different types of people that make up the world of business and they are often technically, emotionally, and mentally different people.

E stands for employee.,
S stands for self-employed or small business owner.
B stands for big business owner (over five hundred employees).
I stands for investor.

For example, an employee will always say the same words, whether he or she is the president or janitor of the company. An employee can always be heard saying, “I’m looking for a safe secure job with benefits.” The operative words are safe and secure. In other words, the emotion of fear often keeps them boxed in that quadrant. If they want to change quadrants, not only are there skills and technical things to learn, in many cases there are also emotional challenges to overcome.

A person in the S quadrant may be heard saying, “If you want it done right, do it yourself.” In many cases this person’s challenge is learning to trust other people to do a better job than he or she can. This lack of trust often keeps them small, since it’s hard to grow a business without eventually trusting other people. If S quadrant people do grow, they often grow as a partnership, which in many cases is a group of Ss binding together to do the same job.

B quadrant people are always looking for good people and good business systems. They do not necessarily want to do the work. They want to build a business to do the work. A true B Quadrant entrepreneur can grow his or her business all over the world. An S quadrant entrepreneur is often restricted to a small area, an area he or she can personally control. Of course, there are always exceptions.

An I quadrant person, the investor, is looking for a smart S or B to take care of his or her money and grow it.

In training his son and me, rich dad was training us to first build a successful S quadrant business that had the capability of expanding into a successful B quadrant business. That is what this book is about.

Page 3: What Kind of Business Do You Want to Build?

Copyright © 2005 by Robert T. Kiyosaki with Sharon L. Lechter.

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