Mark Cuban Said What?
Marc Cuban said that it’s a dumb idea to take out a loan when starting a business. But what does Matt think? Will it be in alignment with the business guru?
There are tons of people out on social media giving business advice. Some of it is good advice, but most of it isn’t good. In this new series watch CapForge’s owner react to different advice videos. He’s an expert in all things business and has 20+ years of experience under his belt. Some of the things he reacts to might even surprise you!
Video Transcript:
Advice Video:
You’re starting a business and you take out a loan, you’re a moran. Because you, there’s so many uncertainties involved with starting a business. the one certainty that you’ll have, to have is paying back your loan. 99% of small businesses you can start with next to no capital. What’s more about effort small businesses don’t fail for lack of capital, they fail for lack of brain, they fail for lack of effort. If you start a business you better know your industry and your company better than anyone in the whole wide world. Because you’re competing you’re gonna compete with me on one of my businesses, you better realize that I’m working 24 hours a day to kick your ass.
Matt:
Okay well, Mark Cuban, I’d say he does know what he’s talking about. And I would listen to that advice for the most part, you don’t wanna borrow money to start a business unless you are 100% sure that whatever you’re borrowing the money for you are going to be able to pay back and including the interest and still have it make sense. So you don’t wanna borrow money to start something if you don’t need to borrow it. If that isn’t part of the plan and if that isn’t an essential aspect of the business that you already know well. So I mean I can, for example, imagine if you’re starting a car dealership you’ve been in the car dealership business for 30 years and you’re getting into a new one. You know what you’re doing and you may borrow money to be able to initially stock the inventory of cars that you need to sell as a car dealer. I would say you’re not taking a huge risk because you have 30 years of experience in that business and you know you’re gonna be able to sell the cars. But I don’t think that’s what he was talking about. I think he was talking about borrowing 10 or 50 or 100 thousand dollars to start some business that you don’t know anything about. But you can’t afford to start it or figure out how to start it with less money or no money and that is risky. And that is definitely something I agree with him that is not the way to get started.
