Weekly LIVE Office Hours #297: Q&A Career/Business/Finance Topics. SEE DESCRIPTION FOR CLICKABLE Q&A

The speaker, Chris Haroun, hosts a weekly live Q&A webcast where he answers questions on various topics related to business, career, finance, and personal growth. During this particular webcast, Chris discusses topics such as financial statement forecasting, startup funding, real estate investing, networking, and career advancement, emphasizing the importance of long-term thinking, taking initiative, and helping others.

Financial statement forecasting

• 00:01:35 When forecasting financial statements for a subscription-based SaaS business model, focus primarily on revenue growth, as other expenses, including cost of goods sold (COGS), typically become a percentage of revenue. Analyze historical data to determine the percentage of revenue that each expense represents and project those percentages forward. This approach simplifies forecasting and allows for better understanding of long-term trends.

Startup funding

• 00:05:03 For pre-revenue startups, it's essential to forecast for at least five to ten years. Venture capitalists prioritize a strong management team with a compelling business model over robust financials in the early stages. Founders should demonstrate passion and enthusiasm, effectively selling their vision to investors. The total addressable market (TAM) should be significant, at least $20 billion, to ensure the company has the potential to achieve substantial revenue growth.

Real estate investing

• 00:11:59 The real estate market is cyclical, and it's crucial to determine the current stage of the cycle before making any investment decisions. Factors to consider include economic growth, unemployment rates, population growth, and rental yields. Multiple valuation methodologies, such as price per square foot, gross rent multiplier, cap rate, and net present value (NPV), should be used to mitigate the margin of error and make informed decisions.

Networking

• 00:27:53 Networking is crucial for career advancement, especially in the hedge fund industry, where connections often outweigh online applications. Use LinkedIn to identify individuals with shared backgrounds and interests, reaching out with a personalized message highlighting those commonalities without explicitly stating your purpose. This creates intrigue and increases the likelihood of a meeting. Attending annual shareholder meetings provides an opportunity to engage with CEOs and other executives directly.

Career advancement

• 00:39:58 Always engage with decision-makers and avoid wasting time with individuals who lack authority. Proactively seek feedback from your boss, both formally and informally, to identify areas for improvement and demonstrate your commitment to professional development. Be a giver and proactively help others in their careers, building valuable relationships and fostering a culture of support. Remember to be a salesperson for yourself, reminding your boss of your accomplishments and demonstrating your value.

Live below your means

• 00:54:35 Living below your means is a key principle for financial success, allowing you to save and invest a substantial portion of your income. Take advantage of tax-advantaged retirement savings programs, such as 401(k)s in the United States, to maximize your returns and minimize your tax burden. Consider educational savings accounts for your children's future education.

Start your own company

• 01:03:01 The most effective way to live life on your own terms is to be self-employed. Start a business with zero down by leveraging other people's money (OPM) and utilizing online platforms like onlinejobs.ph to hire affordable contractors. Develop a virtual product, such as online courses, to eliminate inventory costs and enable greater flexibility. Utilize AI and technology to automate tasks and streamline operations, further reducing overhead and maximizing profits.

Leveraging AI

• 01:59:20 AI can be a powerful tool for advancing education, customer support, and business operations. Utilize chatbots, such as chatbase, which are powered by openAI and ChatGPT, to provide automated support and answer frequently asked questions. Leverage AI-powered language translation tools to make your content accessible to a broader audience. AI can also be used to automate repetitive tasks, improving efficiency and freeing up time for more strategic initiatives.

Total addressable market

• 02:28:22 A total addressable market (TAM) of at least $20 billion is a good indicator of a promising business idea. A company that captures 5% of a $20 billion market can generate $1 billion in annual revenue. When evaluating a new business idea, consider the TAM of the existing market it's targeting, even if that market is being disrupted. Use Google, reputable consulting reports, and chatGPT to research the TAM of a specific sector. You can also estimate the TAM by adding up the revenue of the top 25 publicly traded companies in that sector.

Predicting trends

• 02:35:05 Predicting trends involves thinking long-term and using common sense. Identify sectors that are likely to be more relevant in the future, such as space exploration, and avoid value traps, which are companies that appear cheap for a reason. Focus on investing in companies with strong earnings power and a clear path to profitability.