How To Get Rich According To Mark Cuban

There are a million ways to make a million dollars, and today we're looking at how Mark Cuban's done it. For those of you who live under a rock, Mark Cuban is an American serial entrepreneur, investor, one of the main sharks from Shark Tank, and he also owns the Dallas Mavericks for good measure. As of now, his estimated net worth sits around 6.5 billion US dollars. He still holds the record for the biggest online sale ever when he bought his G5 private jet for 40 million U.S.

We've collected the most important lessons from his journey for you to draw some inspiration from. So without further ado, here's how to get rich, according to Mark Cuban.

Welcome to Alux! We're going to start off with a basic but very valid point: to live below your means. In one of his blog posts, Cuban said, "Your biggest enemies are your bills. The cheaper you can live, the greater your options." He spent a lot of his early teenage years with five other roommates in a one-bedroom flat, but that allowed him to focus on his number one goal.

Mark Cuban became a millionaire when he sold his first company, Micro Solutions, for six million US dollars, from which he got two. Up until that point, he still lived like a student, as he likes to call it. He never splurged; he didn't buy expensive cars nor a bigger house, even when the company kept growing.

This is the first important lesson: if you truly want to become rich and in control of your own destiny, you can't afford to act rich until you are rich. It'll just delay your progress or sabotage it altogether. So many people jump straight into upgrading their appearance when they start making a bit of money. Zara gets replaced with Gucci, even if it's just a t-shirt. The watch gets more expensive, the car gets an upgrade, and the local food restaurant just doesn't cut it anymore.

This is called lifestyle inflation, and if you keep spending money in the same way you earn it, you'll never gather enough to have a significant jump toward being wealthy.

Pay the bills with a job. Mark Cuban's first job was to sell garbage bags in his neighborhood. He bought them for three dollars and sold them for six by going door to door and telling people they can call him anytime they need garbage bags. He considers it the first subscription-based garbage bag business, and he used the cash for pocket money and to invest in the stock market.

The point is your first business endeavor will almost certainly never be the one that makes you rich. You're not going to build the next anything on your first try. You don't have the experience nor the resources needed to make it happen. Take care of your bills first with either a job or a small, simple business that gets the job done. You can't afford to build a big business if you can't pay for your food or for your life.

With equity, this is common advice among millionaires and billionaires. Mark Cuban's net worth skyrocketed to 300 million U.S. when his second business went public. That was the first time he said, "Okay, I'm set for life now." But here's the reality: you will never ever be rich by having a job. It's just not happening. There's no job out there that pays millions of dollars on a yearly basis.

"But Alux, what about superstar athletes like Messi? His agreement with Inter Miami is worth 150 million dollars over a two and a half year period, so that's a job that pays millions, right?" Well, no, not really. That’s an investment in ticket prices, merchandise, PR, and branding. Have you ever heard of Inter Miami until now? Because we didn't.

The point is you need to be a part of something that goes up in value, and that means owning a business or at least part of a business. The salary of a CEO is peanuts compared to company stocks, and if you don't know how that works, check out our video to see how we explain why CEOs are paid 300X more than average workers.

Play with your team. Mark Cuban was always a fan of the Mavericks, and he knew he could do a better job at turning that team around. That's why he bought it for 285 million US dollars. One of the first things he did was to set up his office alongside the sales team. He picked up the phone and started calling people. "Hello, sir! We know you've been at our games before, but did you know a ticket to the Mavericks game is less than a McDonald's meal? Why don't you come and see what we're all about? The first games on us!"

Now, the point is if you're serious about building wealth, you'll eventually have a team around you. If you want that team to do great, they have to work with you, not for you. Remember when Mark sold that first company for 6 million and he only got 2? Well, his employees got one million dollars as well. You won't get far bossing people around and telling them how to do things you'll never do yourself.

Just because this is extremely important—and we can confirm from experience—it's impossible to do everything on your own. You need great teammates with you.

Value over passion. Mark Cuban is in the camp that doesn't agree with the saying "follow your passion and see where it leads you." In a 2018 interview with Amazon Insights for Entrepreneurs, he said, "A lot of people talk about passion, but that's not really what you need to focus on. You really need to evaluate and say, okay, where am I putting in my time?"

The point is your passion is rarely financially viable. Sure, it would be a dream to make millions out of your passion with knitted sweaters, but it's probably not going to happen. Look at what you're actually good at instead of what you enjoy doing in your free time. For every person that makes a ton of money out of their passion, there are millions that go broke because of it.

So be smart when it's time to make the jump. Go for it! In an interview with CNBC, Cuban said, "There's no person on this planet who hasn't had that 'oh my god, I've got this idea' moment, but very few actually make the jump and go for it." And that's because the monthly paycheck is a very strong addiction.

It's hard to leave the comfort of a reliable income, whatever that might be, in order to pursue something greater but perhaps a little unstable. Many people stop at "get a job to pay the bills," but never go beyond that. It takes some guts and confidence in yourself to sacrifice that monthly paycheck for the unknown. But ultimately, that's what you have to do in order to make it.

Find out what you're good at, and make the effort to become great. Cuban believes everyone in the world is good at something, but the first hard part is to find it. The second hard part is to actually become great at it. Whether it's business, sports, music, drawing, writing—everyone has an innate inclination to something that makes them better than those who don't have it.

Those who say "Oh, I'm not good at anything" haven't tried enough things to figure out, or they were put into a context where they couldn't try too many things. In that case, it's pretty hard to figure it out. For some, they've known their talents from childhood, and others don't figure it out until they're in their 30s, when the pressure is higher. But it's something that you have to do, and then the second part is to actually become great at it.

Okay, talent is not enough, and hard work always beats talent when talent doesn't work hard enough. What you're good at gets you a starting point, and then you have to fine-tune your ability until your skill becomes undeniable.

For Cuban, that skill was selling. Ever since he was a kid, he bought and sold baseball cards, stamps, garbage bags—whatever he could find—and that constant skill honing eventually made him great at selling, which in turn led him to enter the technology business.

So find what you're good at and then make an effort to become great at it. It'll pay off dividends for the rest of your life.

Build a base knowledge on your adjacent interests, or in other words, do your homework on things that might be useful to you. A great example is how Cuban started educating himself on AI more than five years ago. He understood that this technology could impact a lot of his businesses and took the time to get educated.

In an interview with Yahoo Finance from 2019, Cuban said he already started to read books like "AI for Dummies," take Python classes, and talk to people just so he could understand the space more. He didn't do it in order to become the next big AI company, but to be able to ask questions and actually understand the answers when the time came.

So why is this important? Well, it's hard to see opportunities when you're not even looking. The thing that could propel you to the next level might just be around the corner, but if you don't know about it and you don't educate yourself, you will miss it.

Here's how you start: take your business or whatever you're good at and look at 10 different industries or topics that are related to it. Expand your universe of knowledge, and your opportunities will expand with it.

The biggest investment you could ever make: Mark Cuban suggests if you've got 25, 50, or 100K, there's one big investment that you can make, and that's paying off any kind of debt, because that's a guaranteed return. Okay, interest on debt is chipping away at the money you haven't even made yet.

The smartest decision you could ever make with a larger sum of money is to instantly rid yourself of debt, and that's the last thing most people do when they are holding a bag.

And last but not least, have your money ready. One of the most important pieces of advice Mark Cuban has given when it comes to getting rich is to have cash available. You're not saving for retirement right now; you're saving for the moment you need cash when a great opportunity comes up and you're aware of it.

If you don't have disposable cash to use for that opportunity, well, hey Alux, it's kind of pointless. We hope you found this video valuable, my friend. Who should we cover next? Let us know in the comments, and as a thank you for sticking with us until the end, we've got a bonus for you.

It's one of our favorite pieces of money advice from Mark Cuban: it’s easier to save 15 of 10,000 U.S. when you buy in bulk in a year than to get 15 return on 10,000 U.S. invested in a year. Just think about that for a minute.

We'll see you back here tomorrow, my friend. Take care!