In 1974, Ray Kroc, the founder of McDonald’s, was asked to speak to the MBA class at the University of Texas at Austin. A friend of mine was a student in that MBA class. After a powerful and inspiring talk, the class adjourned and the students asked Ray if he would join them at their favorite hangout to have a few beers. Ray graciously accepted.
“What business am I in?” Ray asked, once the group had all their beers in hand.
“Everyone laughed,” my friend said. “Most of the MBA students thought Ray was just fooling around.”
No one answered, so Ray asked again, “What business do you think I’m in?”
The students laughed again, and finally one brave soul yelled out, “Ray, who in the world doesn’t know that you’re in the hamburger business?”
Ray chuckled. “That’s what I thought you would say.” He paused and then quickly added, “Ladies and gentlemen, I’m not in the hamburger business. My business is real estate.”Rich Dad Poor Dad
As my friend tells the story, Ray spent a good amount of time explaining his viewpoint. In his business plan, Ray knew that the primary business focus was to sell hamburger franchises, but what he never lost sight of was the location of each franchise. He knew that the land and its location were the most significant factors in the success of each franchise. Basically, the person who bought the franchise was also buying the real estate under the franchise for Ray Kroc’s organization.
Today, McDonald’s is the largest single owner of real estate in the world, owning even more than the Catholic church. McDonald’s owns some of the most valuable intersections and street corners in America and around the globe.
My friend considers this as one of the most important lessons in his life. Today he owns car washes, but his business is the real estate under those car washes.
The previous chapter presented diagrams illustrating that most people work for everyone but themselves. They work first for the owners of the company, then for the government through taxes, and finally for the bank that owns their mortgage.
When I was a young boy, we did not have a McDonald’s nearby. Yet my rich dad was responsible for teaching Mike and me the
same lesson that Ray Kroc talked about at the University of Texas.
It is secret number three of the rich. That secret is: Mind your own business. Financial struggle is often directly the result of people working all their lives for someone else. Many people will simply have nothing at the end of their working days to show for their efforts.
Our current educational system focuses on preparing today’s youth to get good jobs by developing scholastic skills. Their lives will revolve around their wages or, as described earlier, their income column. Many will study further to become engineers, scientists, cooks, police officers, artists, writers, and so on. These professional skills allow them to enter the workforce and work for money.Rich Dad Poor Dad