I have to admit, I’m a loser.

I have thrown my entire life savings, which was a meager $100k, into my entrepreneurial ventures. In 2015 I watched that $100k literally go to $0 within a course of 4 months. Long story short, I had my tail between my legs and sucked it up and took a consulting gig at Directv, and this bought me enough time to resuscitate my business and get it on its legs.

It took every ounce of my being to get up at 5am every day, get my ass into work, run the show efficient and fast, then spend any free time I had in conference rooms working on my own stuff. After work, I’d work away at my business each day, hustling to keep it alive.

Eventually the $100k turned into a profit, and my partners have all benefited from the fruits of my labor.

However, I have to admit still, I’m a loser.

I had to lose, and throw it all away, to understand what it was to truly hustle. I learned that it’s not just creativity that comes from necessity – it’s resourcefulness, the determination to persevere, and humility. Yeah, you break your pride when all your friends and family know you just took a big risk and blew it.

Now, one lesson I learned from this was that one can talk, pontificate, jibber jabber, yap yap yap all day all year long, but if you’re talking about business and money matters, there’s only one thing that truly counts.

Numbers.

I’m Korean and I suck at numbers. But all this past year, numbers have been a good majority of my work. At the end of the day, numbers are what truly matter, and numbers are what pays the bills. You can talk about how many numbers there are, how big they’ll be, and what you can do with those numbers, but if the numbers are not actually there, it’s all horse shit. At best, it’s a great idea.

I was confronted recently by a friend who was considering joining a group called Fortune Builders (fortunebuilders.com). I had seen this before, and I felt in my bones that it was a scam of the first order. I remembered that another friend of mine had actually gone through this program. He had educated me previously that this program was basically an undergraduate degree in house-flipping. He further proffered that this program is successful because in any market, there are distressed homes and motivated sellers. The short of it is that this program teaches you how to find people in distressed homes, establish contracts with them to control their title rights & promissory note obligations in the event of a default, and basically count on them to default. You do pay them an up front amount to “purchase” this contract of course, and this is usually several thousand dollars.

My natural skepticism was there – you need capital to start- and you do – $25-50k, depending on how much you decide to invest into this program. Provided you somehow do have that cash laying around, then the hard work begins. Prospecting, hiring a team to “take over various aspects of the business,” taking the time to get out there and make all the connections – well, this takes significant time, effort, and money.

In business, I like to ask the following questions:

1. how long have you been doing this business?
2. how much money have you made, either actuals or as a % of your initial investment?
3. what is your realistic potential of the future?

It’s a simplified version of what VC’s like to ask startup founders. When I asked my friend these questions, he responded:

1. slightly more than 2 years
2. complicated question but I’ve made more money investing in notes than I have in flipping
3. I’ve been working to raise private capital and increase lines of business credit. Once that happens I feel optimistic about the future.

While I admittedly would like to learn more about these details, the numbers don’t lie. My friend had invested $25k over 2 years ago, and partially recovered it by now. Now, most businesses do take up to 5 years to break even, and a great majority of them fail before then. But there has to be a trajectory or a plan around the numbers.

Whenever someone is unable to talk about numbers, there is uncertainty. There is uncertainty in the person’s confidence in themselves. If they truly believed in their own investment, the proper answer is, “Since I started 2 years ago, I established 7 contracts, each of which has made 2-3k, and I’m planning to take these actions with a goal of 10 more contracts by the end of the year.” Or, something like “I’ve made back about 40% of my initial investment, and I’m shooting to get to 70% by year end, with breakeven happening next year.” I’ll even take THAT as a good answer.

THAT is an answer of a business owner who believes in their investment, and their idea. If they would put their money where their mouth is, why is it a complicated question to answer where you are in the business today? It conveys uncertainty and lack of confidence.

This is why numbers are so important. They don’t lie, they don’t hide things. Numbers display the truth.