The hardest and most important part about getting wealthy is learning to delegate effectively, and 99% of business owners suck at this skill. When it comes to management tasks, those are tasks that aren’t simple to just hand off, business owners and managers struggle to give up decision-making power. Quoting jobs, hiring and training employees, selling new business, and other tasks will impact your business but need to be effectively handed off if you want to maintain your sanity. If not, you’ll be one of the owners that works too much and find themselves underpaid.
You can’t learn this from a book, you learn it by practicing clear and concise communication and empowering your employees to think like you. If you can simplify a job, communicate it effectively, and make it easy to drive the business, you’ll be setting yourself and your employees up for success. You don’t need to be great at delegating to make great money, you can get wealthy just by being open to trying.
Every decision that you and your employees make should clearly trace back to a goal: you want to maximize profit, deliver great customer service, minimize inefficient spending, etc. When delegating a task to an employee, it should be clear enough that they know the end goal, and you can see what type of decision they make. If they make a good decision, one that makes sense and aligns with how you would act, then you can give them more to work with. If they do a bad job, you don’t have to give them that kind of power moving forward.
The most underrated part of this is finding a good business to work in. Many people, myself included, start with hard businesses where you trade your time for money and learn to delegate in a low-risk environment, like a sweaty startup. These businesses can be profitable from day one, don’t require a lot of upfront capital, and are always in demand, and there’s only so much damage an employee can do by making a bad choice.
As you grow, you can transition to easier businesses with more at stake where you can apply your learnings. Our student storage business was a hard business that was very seasonal, tough to hire, and hard work, but we learned a ton from it. We then went into self-storage development and operation, which had fewer moving parts and fewer employees. Eventually, that grew into a real estate private equity portfolio, where we put capital to work with a higher risk but great money. Succeeding in this easy business would be almost impossible without everything we had learned earlier about operations, hiring, and delegation.
There’s no magic answer to this, there never is. You’re going to spend almost all of your time as a leader finding, recruiting, and trying to hire good people, and you’ll need to rely on and trust those people if you want to really launch your business. The most important thing about delegating is making things as simple as possible and setting your employees up for success.
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