Don’t Risk Your Money — Watch This Before Starting Your Business

Name: Don’t Risk Your Money — Watch This Before Starting Your Business
Uploaded: 2025-09-19T22:41:36+00:00
Duration: 23 min 23 s
Channel: Shine Star

Shine Star

Thinking about starting your own business?
Don’t risk your hard-earned money before you watch this! Discover insider secrets and key mistakes almost every new entrepreneur makes — and how to avoid them. Whether you’re launching a side hustle or a full-time venture, this video could save you thousands and set you on the right path.
Watch now and get the clarity you need to build a successful business with confidence!

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00:00You will fail.

00:01You will fail.

00:02You will fail.

00:03In entrepreneurship.

00:04Everybody on the internet dreams about the title of CEO, but it comes with scars.

00:07I've made billions of dollars of failures at Amazon.com.

00:12Literally billions of dollars of failures.

00:15They shouldn't want to be you.

00:17I think it sounds better than it is.

00:19It's not as much fun being me as you'd think.

00:22You are here, but you want to be here.

00:26Likely you think it goes something like this.

00:29The truth of the matter, it goes like this.

00:33In the first year, 10% of businesses fail.

00:35In the second year, 45% of you will be gone.

00:38By year 10, 75% of businesses will no longer exist.

00:42I want you to know the truth so you can brace yourself.

00:44If you know this is the reality and not this, then you prepare for what's coming.

00:50If you can expect failure, maybe you can beat it.

00:52Also, one huge failure would be to not subscribe to this channel.

00:55So make sure to hit that subscribe button.

00:57We got a lot more like these coming for you.

00:59The day you can't pay the man who worked for you the hardest.

01:01So when you become a business owner, the second Friday of every month sort of takes on a new

01:05meeting.

01:06And you know that that is the day in which you owe the people who choose to spend their

01:09lives working for you their next paycheck.

01:11My dad has an incredible story that I only started to understand after I had to pay everybody

01:16every Friday.

01:17About where back in the day when he was running a construction business, every Friday he'd be

01:21really tight to having enough money to pay his people.

01:24You see in construction, you contract for something, you do the work, and you don't get paid until

01:29afterwards.

01:30So there's what's called a cash lag in every business or float.

01:33One Friday, he remembered he wasn't going to have enough cash by the end of the day.

01:37And he kind of sat there, took a deep breath, and realized as his employees were coming in

01:41and coming in that the last man to come in that day was not going to get paid.

01:45But the part that hurt the worst about this is that man would be the same person who had

01:48worked longer than everybody else, and he would be the one left outstanding.

01:53So my dad had a rule, and that rule was his word was never broken when it came to money.

01:59So he called up his banker, and he told him to put a personal guarantee on the house,

02:03and that he would use the money from that house to pay for extending a line of credit

02:08to the business.

02:09And he made sure that that guy got paid.

02:11Every single business owner has this type of story.

02:14I've never once in any of my businesses not paid somebody who came and worked for me.

02:18That's a line I drew in the sand.

02:20As a business owner, there's many times where I don't pay myself.

02:22In fact, I pay myself the bare minimum that we need right now from this company, contrarian

02:26thinking.

02:27I don't make the most money at this company.

02:28A bunch of other people do.

02:30And in fact, that's usually how it goes.

02:31For the first couple of years in business, you're not the one getting paid.

02:35Your employees are.

02:36At least that's how good entrepreneurs are.

02:38Lots of people out there will be talking about the millions that they make every single year,

02:41but the truth is you usually need to spend a lot of money on your business before

02:44your business starts paying you.

02:46So no, I've never not paid an employee and I hope I never have to.

02:51How can you make sure this never happens to you?

02:52This right here is a 13 week rolling cash flow.

02:55Basically what this statement does is it makes sure every single week you are tracking the

02:59money into your business and the money out.

03:01You can see this little segment at the bottom.

03:03This shows you how much money you have in your bank account.

03:06And it also shows you how much money you're projected to have on a forward looking basis.

03:10I am never caught unaware of when my businesses are going to lose some cash because every single

03:15one of my businesses runs on this 13 week cash flow.

03:18If you guys like this, we'll put a link down below, you can take this 13 week cash flow

03:22for you.

03:23This is like private equity, one on one, every business runs in a 13 week cash flow.

03:27And if my father had this, he probably could have rearranged things in order to make sure

03:31that he didn't have to put a line of credit on the house.

03:33Which is a really scary thing to do that I do not recommend.

03:36The lesson here, your word is your bond, cash is king, pay your people even when it hurts.

03:41Tough story number two, the day you get defrauded.

03:44Your most expensive mistake will not be what you do, but who you choose to do it with.

03:49This is a really hard lesson that I learned.

03:51We actually had a friend.

03:52This friend kind of got into our lives, talked me into investing in a business actually alongside

03:57him.

03:58And we didn't track that business as close as we should have, I'll be perfectly honest.

04:02I'm a little embarrassed because typically I track my businesses pretty tight, but this

04:06one was a friend business.

04:07It wasn't a very big business for us, so we weren't paying a ton of attention to it.

04:10My husband started to realize that we had some weird cash flow issues going on in it.

04:14So we pushed it over to the CFO of the company and said, this doesn't seem right that the company

04:18is making this much money and yet the profit is so low.

04:21We know for all of our businesses what the average profit margin is for them.

04:25And for this one, we thought the business should be somewhere between 15 and 20%.

04:28And we looked at the business and realized that it was basically losing money just minorly

04:33each month.

04:34We realized something must be going on.

04:36When we talked to the guy who ran the business, my friend, kind of gave a lot of excuses, but

04:40those excuses continued week after week until we finally figured out that the guy was stealing

04:45from the business.

04:46That he was actually taking the money, giving some to himself, giving some to the operator

04:50of the business and also paying for expenses out of the company.

04:54And this one kind of broke my heart a little bit, actually, because I really liked the guy.

04:57I think the hardest breakups and frauds to have in your business are when you think that

05:02they're a friend.

05:03And business and money make people do crazy things.

05:05So I think maybe you haven't actually been in the game until you've felt what it feels

05:09like for somebody to steal from you or for somebody to defraud you, which is an awful

05:13thing to say.

05:14But there is some silver lining, which is you realize at the end it's not going to kill you.

05:18You become a lot more aware for what the next fraud is going to look like.

05:22Your spidey senses tingle a lot sooner and you remember that your weakest point is always

05:27going to be your emotions, right?

05:29So that's why people coming in as a friend, you've got to have the exact same rules for

05:32them as you have for everybody else.

05:34How do you spot somebody with integrity or who's a good person to work with?

05:38One, if you have any question or you think that you need a contract in order to protect

05:42the relationship, it's an ultimate no.

05:43If you think you need to contract something overly, you already have some spidey senses not

05:47trusting this person.

05:48But number two, no matter how much you trust them, you need a contract.

05:51If this goes sideways and you list all the reasons why that could, what happens and how

05:56do you keep control of the thing that you've put money into?

05:59And lastly, I would say the best predictor of future behavior is past behavior.

06:02So this guy, for instance, hadn't been very monetarily successful before.

06:06He talked about other business partners that he had in kind of a bad light.

06:09He didn't have a history of wins and successes in business.

06:12And for some reason, I ignored all of that.

06:14The humans that you choose should be somebody that's been a top performer at their job,

06:19been incredible to work with, seen some huge success as an athlete or something even previously.

06:26And if they haven't done any of that stuff, you can kind of assume they won't in the future.

06:29The lesson is just because you're close doesn't mean you should close on a deal with a friend.

06:34Frauds are everywhere and humans are incredible self rationalizers, which means that we can explain

06:39to ourselves really, really easily why something's in our best self interest.

06:44So you'll be amazed how many times somebody defrauds you and then blames it on you later.

06:48Just because they're close doesn't mean you should close.

06:51The day someone you helped turns against you.

06:53My dad has this incredible line, which is never wrestle with a pig because you both get dirty,

06:57but the pig likes it.

06:58And this one always made me giggle, but he talked about one of his partners back in the day.

07:02And this partner of his, he ended up selling his business to a small little mom and pop S&B business.

07:08This partner decided at a certain point that the contract that my dad had with him,

07:13my dad wasn't going to come after him.

07:15He would pay him kind of the upfront thing, but he wouldn't pay him for the rest of the business.

07:18And what's kind of wild about that is when that happened, my dad realized that this guy that he had been working with,

07:25growing this business with just stopped responding, stopped responding to calls, emails, texts.

07:31He had to go get an attorney to go after this guy.

07:34Fascinating part about all this way back before that.

07:37My dad was the one that helped this guy start his very first business.

07:40They knew each other for years, maybe even decades.

07:43So the guy that he helped became the guy that turned on him.

07:46This unfortunately is part of the rules for the road.

07:48Why do people do this?

07:49Here's what I've seen happen most often.

07:51People don't start out with a bad intent.

07:53Typically, they start out thinking that it's all going to work out well between the two of you.

07:57But then the business starts to go sideways up or sideways down.

08:01What does that mean?

08:02If the business starts to go sideways down, that's where you have people sort of hide money,

08:06pretend like everything's okay and stack up mistake after mistake after mistake and not tell you until it's too late.

08:12Think about it like this.

08:13I don't know if you guys remembered Selena, but Selena's manager for one of her charity portfolios is the one that killed her.

08:19And the reason why Selena's manager killed her is because Selena's manager was kind of working this charitable foundation and stealing some of the money.

08:27And then there used to be a ton of money coming in where the manager could cover it up for Selena and that money stopped flowing.

08:33And so Selena's manager got caught and she knew it.

08:36And so before she could get fully caught, she wanted an ultimate decision out.

08:42Now, thankfully, it's not that bad usually in business, but that's why when something starts to go sideways, people dig in and they make worse and worse and worse and worse and worse decisions.

08:51I'm sure we have all had moments like that in life in some way or another.

08:54Now, the opposite way a business goes sideways is an upside sideways.

08:57What happens there is you guys start a business together.

09:00It's equal at the beginning.

09:02It feels good for you two to be working together.

09:04But at some point, the business starts making so much money and maybe you're less involved or maybe you and your co-founder have different skill sets.

09:11And eventually your co-founder is going to think, huh, my skill set is more valuable than their skill set.

09:17And so I should be compensated a different way.

09:19This happens a lot.

09:20It's even happened to me on the other side where I thought that I should be compensated more and they thought they should be compensated more.

09:26And so we have to both battle it out.

09:28Humans are incredible self-rationalizing machines, as I said.

09:31The lesson here is this.

09:32Never listen to a person that talks badly about others but tells you to trust them.

09:36That is your little red warning sign.

09:38That that person probably has rationalized themself into an upside or a downside deal before and blamed it on somebody else.

09:46You want people who say, you know what?

09:48It didn't work out in my last job because I didn't really like it and so we parted ways amicably.

09:53My last partnership wasn't exactly what we needed, so I moved on.

09:57You don't want somebody that says it was all that other guy's fault, all this other girl's fault.

10:00That is a big red flag.

10:02Back in the day I ran a business at State Street.

10:04This business sold investments and what's called money market mutual funds to big institutions, sovereign wealth funds, etc.

10:11And this business was doing billions in assets under management.

10:15I was just part of a division where I headed a division of this business.

10:19The crazy part is we were doing everything right.

10:21We were growing like crazy.

10:22We were the biggest in the industry and getting bigger.

10:24And then something happened.

10:26The government came in and said that the way we structured those products, it could no longer exist.

10:31And you can kind of think about it like this.

10:33If you owned a donut shop and that donut shop then got required by the government that all donuts had to have a hole in the middle.

10:40But your best selling donuts were filled with jelly.

10:43All of a sudden your best selling product can no longer be sold.

10:46But you only sell one product, so what are you going to do?

10:48Well, for me, I had to leave that business.

10:51I decided that in that moment I would go out and I would diversify our investment base.

10:56I would bring in more products.

10:58So I went to Latin America to get new clients and where the government couldn't regulate it the same way.

11:03And I also started to branch out to different types of donuts.

11:07And we started selling things like private equity funds and hedge funds.

11:10I realized that I didn't have the knowledge necessary to really survive in this world.

11:14So I thought that all you needed was to know how to sell, how to invest, and how to build this business.

11:19I didn't even think about the government coming in and being able to take away my entire business with a stroke of the pen.

11:25So I went to Georgetown and I started getting my MBA there during this time period because I had to get smarter, not just work harder.

11:32The lesson is one trick ponies die fast.

11:35You need multiple tricks.

11:37This story is wild.

11:38This is the day that your payment processor or bank takes all your cash and decides to not give it back to you.

11:43We have a small business that we own and this small business used Stripe.

11:47Totally normal payment provider.

11:49Unfortunately, this small business owner missed a couple of chargebacks.

11:53People saying that they didn't want this product and they just put a chargeback in instead of going through with the purchase price.

12:00They missed like three over, let's call it six months, three months, something like that.

12:05So what did Stripe do?

12:06They sent them a warning, but my guy kept going back and forth with Stripe and saying, oh, but we can figure it out, whatever.

12:12And then the second that my guy goes to withdraw his funds that he needs to pay his employees and run his business, Stripe shuts off the transaction and holds all assets of the business hostage for 90 days.

12:23So when I hear about this, I go to the founder and operator of this business.

12:27I'm like, what happened?

12:28They run an analysis for me.

12:29I get pissed because I look at that analysis and I go to Twitter like a Karen.

12:33And I basically say on Twitter, Stripe, how could you shut down this small business?

12:37Look at what happened.

12:38The wild part about this story is this tweet got millions and millions of impressions because of so many small business owners saying that Stripe had done the exact same thing to them.

12:49And Stripe to its credit has a balance that it needs to keep to make sure people aren't defrauding people.

12:55Its bank credit worthiness stays straight.

12:58But the part that Stripe isn't thinking about is most small businesses, do you know how much cash they hold on hand?

13:0330 days.

13:04So if Stripe holds somebody's entire cash allotment of 90 days for a small business, they've just bankrupted that business inside of three months.

13:13For Stripe, it's just a checklist.

13:15For this owner, it's their livelihood.

13:17So the lesson that I learned here is Stripe was too big for us and even me to mess with.

13:22They basically changed the narrative, got Twitter to put this little thing on here saying misinformation and continued to move forward.

13:29What do you need to do?

13:30You need to make sure that you diversify your bank accounts and your payment processors.

13:35Go around and ask small business owners if they have ever had a bank shut them off or their payment processor stop.

13:41I can almost guarantee you 8 out of 10 are going to tell you an example of when they did.

13:44So don't believe the big companies like Stripe that say that they don't do this.

13:47They do.

13:48I'm not saying they're malicious.

13:49I'm saying they're not very thoughtful about the fact that one small checklist decision can put somebody entirely out of business.

13:56Diversify your processors.

13:57One of the other ways to avoid this with big companies is besides just having multiple payment processors, which is smart, is reading the fine print.

14:06Can they do this to you?

14:08How often can they do this to you?

14:10And if they can, make sure you take every dollar out of your Stripe balance account when you make it.

14:15This founder made the mistake of leaving 60 days, 30 days worth of cash in his Stripe account.

14:21So Stripe could pull back the whole thing.

14:23If he had been taking out all money but his mandated reserve currency, his business might have survived.

14:28Thankfully, I got to fund the business for him and so he continued.

14:30But make sure that you're pulling cash into something you can control and never letting anybody else control the ball.

14:35You control the ball.

14:36The lesson here is you can't fight the big boys.

14:38They have more firepower than you do.

14:40They have more attorneys than you do.

14:42And they can call in favors to people like Twitter.

14:45The next true story is at some point one day you were going to feel like giving up.

14:50I experienced that when I was running a large asset management business in Latin America with a company called First Trust.

14:55And I remember I was set to fly home on a Friday night from Santiago, Chile.

14:59The airport was not nice back then.

15:01I don't know if it is now.

15:02And so I'm waiting for basically the last flight out of Santiago and it's getting delayed and delayed and delayed.

15:07Finally, the flight gets canceled.

15:09Traffic in Santiago is awful.

15:11So it had taken me another couple hours to get back to the hotel that I now needed to hope I had a room at.

15:16And after a long week of multiple red eyes, I was just exhausted.

15:19I felt like I didn't know what I was doing anymore.

15:22I was working 60, 70 hours a week for what reason?

15:25I just, honestly, I started breaking down in the airport.

15:27And I remember just having a little cry, having a few too many glasses of red wine.

15:31And sitting there and thinking, this isn't worth it doing this for somebody else for this long.

15:36Because on Monday, I had to go and fly from Dallas, where I lived at the time, to Columbia.

15:42So I was basically flying back to Dallas to be there at the weekend with my family.

15:46And then I would have to fly back out on Monday, another whatever it is, seven to nine hour flight to Latin America.

15:51And my heart like broke a little bit that day.

15:54That's why when I tell you, it'll take longer than you think.

15:57It'll be harder than you think.

15:58You'll get more hate than audience.

16:00But do it anyway, except don't do something you hate forever.

16:04That was a little moment in history where my life changed drastically.

16:07From that moment on, I said, I never wanted to have to be on red eyes to run a business anymore.

16:12And I never wanted to have to run somebody else's business for them.

16:16I wanted to run my own business.

16:18At some point, you're going to realize that you don't like running the job or the business that you're in.

16:22It'll just happen eventually.

16:23It's happened to almost everybody that I know.

16:25And you have to know what your plan for exit is.

16:28And you have to come into a business with the knowledge that eventually you might want to get divorced.

16:32And so how could you start with the end in mind?

16:34Thankfully, in this business, I could talk to the CEO of the company and him and I were friends.

16:39And I basically started having a conversation about how I wanted to exit, who could be my predecessor that would come after me and what I wanted to do next.

16:45And maybe he would even invest in my next venture.

16:48So if you are going into something, you go in with rose colored glasses, really excited, thinking everything's going to win.

16:54But eventually, what a win looks like for you when you start is very different than what a win looks like for you when you end.

17:01When I started, the idea of red-eyed flights to foreign lands, to hang out in Santiago, to drink some wine and hang out with a bunch of Chileans sounded amazing.

17:12And by the end of five years, six years, it wasn't so amazing anymore.

17:16Assume that the person that you're going to be tomorrow is not the person that you are today and that that other person is going to want something bigger by that day.

17:22You need to plan with the end in mind.

17:24The lesson is you need to quit sometimes to find your real yes.

17:27We got two more stories for you, but I want to remind you something.

17:29This isn't like failure porn for you to listen to.

17:32This is because if you see these things coming, you can one, prevent them, or two, prepare for them.

17:38And either of those is better than letting them punch you in the face.

17:41I prefer the two other piece.

17:43All right, the next story.

17:44The day that you realize you actually hate your business.

17:47I love this quote, but it also makes me hurt.

17:49If your business depends on you, you don't have a business, you have a job.

17:52And you have the worst job in the world because you're working for a lunatic.

17:55A friend of mine, Andrew Wilkinson, wrote this tweet that I thought was really transparent and true.

18:01And it's worth reading to all of you.

18:02He runs a portfolio of internet businesses, just like I run a portfolio of boring businesses.

18:07About a decade ago, I woke up and said, I'm done.

18:10I had nothing left to give.

18:11Every day, I walk into my office, I go through the motions, but it drained my will to live.

18:15I was miserable.

18:16My greatest joy in life, running my company, had lost its luster.

18:20I wasn't having fun anymore.

18:21I liked running 10-person companies.

18:23Now I had 100 employees.

18:24I was the wrong person.

18:25So I did the only thing that made sense.

18:27I fired myself.

18:28He made some absolutely terrible CEO hires.

18:31He hired a psychopath that lied about their entire resume.

18:34But in the 10 years since, he's learned how to hire exceptional CEOs because he doesn't want to keep working for a psychopath himself.

18:41A job and a business aren't really that different.

18:44You can have a job that you hate.

18:45You can have a business that you hate.

18:47The reason why either of those things happened is actually you or me.

18:51It's because you didn't actually know what you wanted.

18:53And so you jumped into something.

18:54You thought that it would fix that hole inside of you and it didn't.

18:57And that realization in and of itself is why people usually leave jobs or businesses or why people close up shop and never sell their business.

19:04Andrew was lucky because he realized that shuttering the business wasn't an option.

19:10They were doing, I don't know, $100 million a year in revenue.

19:13So his only option was to put in somebody else, a CEO, instead of himself.

19:16Your job, if you're an employee, is to put in a backfill so that you could move on to a bigger position.

19:22If you own a business, it's to put in a CEO or operator or come up with a sale plan.

19:26Either way, at some point, almost everybody will eventually hate their job.

19:30That's why most people don't keep the same job or business for 60 years.

19:33If you expect that and you plan, then you exit.

19:36I'll tell you a funny sort of embarrassing story.

19:38I did a little, like a little medicine journey, as the kids say it in Austin here.

19:45Basically, during it, I realized that I was stuck in a PowerPoint that was representative of one of the businesses that I run.

19:51For like eight hours, I was inside of this monotonous, awful PowerPoint that made me want to gouge my eyes out.

19:58There was like no joy, no happiness in the world.

20:00And apparently, because I'm such a business psychopath, I didn't realize that, you know, I already ran these three businesses over here.

20:06We have a portfolio of businesses here and I was taking on a new business.

20:09It was too much.

20:10I was really getting close to burnout.

20:11I had to sit inside of an awful PowerPoint for eight hours in order to realize it.

20:15It's totally normal, but it doesn't have to be you.

20:18The lesson here is every job sucks.

20:20If you want to do what you love, you have to expect many years of doing what you hate.

20:24The only way to get back into loving it again is to set yourself up in the right way.

20:28The day someone steals all your homework.

20:30So at some point when you are in business, somebody will take all the ideas that you have because they're brilliant.

20:35They will take those ideas, they will label them their own, and they will run away off into the distance.

20:40It's kind of part of the game.

20:41That's why they say the best form of flattery is mimicry.

20:44I'm not sure I agree with that, but it is what happened.

20:46There was a guy that we were going to hire.

20:48Let's call him Robbie.

20:49And he was going to be head of marketing for one of our companies.

20:51And we get pretty far down the lane with hiring Robbie.

20:54And then I have an offer that Robbie and I have agreed on.

20:57And last minute, I think after he thought that I was super vested in him as a candidate,

21:02he basically increased his offer to something crazy that made no sense for the business and what the role was.

21:07And I said, like, Robbie, we can't do that.

21:09We're not going to go that way.

21:10And he said, well, then, you know, I'm not interested.

21:12And by that time I had shown him like a lot of stuff behind the scenes.

21:15And so wouldn't you know, about 30 days later, dear old Robbie comes out and tries to compete in the exact same market for that business.

21:23Hats off to Robbie.

21:24His emails look just like ours.

21:26His marketing materials just like ours.

21:28In fact, he tried to steal some of our employees.

21:30And one of the signs that he had out was very similar to ours.

21:32It didn't end up working.

21:34But the amount of energy and stress that you will feel when somebody takes your ideas and tries to run with them and you don't expect that to happen is huge.

21:43Once you realize that it's going to happen to you in some way, shape or form, you just go, I will outwork and I will outsmart anybody.

21:50So let them try.

21:52And thank God.

21:53Now I look at it.

21:54I'm like, Robbie did me a huge favor because he could have come in and run my business and left me in a really difficult spot.

21:59He did the best thing ever.

22:00He told me upfront who he was.

22:02He got out of the way.

22:03And now we are both out of each other's lives.

22:05Somebody will eventually steal your homework.

22:07The lesson here is don't waste time convincing people that you're right and to side with you.

22:13Let them fear going up against you.