Is investing money into websites, just another form of Gambling?
My partner often accuses me of “gambling” our money with my online ventures. And to be fair when I started out that was pretty much exactly what I was doing. There are other areas which could also rightly be labelled gambling including forex markets, stocks, real estate, poker, horses and obviously Online Gambling. But there are thousands and probably millions of people who make full time incomes from these activities and many earn lots more than regular folk.
So was I really gambling our money with online activities? Well short answer is yes, but I never viewed it like that. However I soon realised the reason my partner saw my activities as “gambling” is because she didn’t have a good (or even mild) understanding of the business practices that apply or the activities I was involved in. Plus I made a few bad choices along the way.
Which brings me to my point. Anytime you spend money on any activity aimed specifically to make more money you are gambling. You can call it investing, doing business, trading, fiscal discipline or whatever helps you sleep at night but essentially you are taking a gamble that your knowledge and hard work will make you a profit. But you don’t really have to be taking the massive same sort of risk that you would with traditional forms of gambling. So knowing this we can apply several key strategies that all successful gamblers (and I mean gamblers in its usual context) use, and apply this to our own money making activities.
Research is everything – Research equates to knowledge and the more knowledge one has the less risk they are exposed to. This is why my partner saw my activities as straight out gambling, whilst I had a more moderate view of the risks I was taking. A good example of doing your due diligence is a Bookmaker. Have you ever seen a bookie just guess the odds of a horse or a sports team? If you have I bet that bookie would not be in business for long. Successful bookies do some of the longest hours in the western world (or at least they do until they are successful enough to hire someone to do it for them). The reason being is that no variable is too small when it comes to giving odds. To keep my point succinct I will just stick with the horses. A bookmaker will look at every single horse in the field and consider all variables including recent form, past form, the trainer, the jockey, medical history, breeding, the condition of the track, the distance, past distances, past conditions, the jockey, the pace of the field, time since last race, changes in racing gear, changes in weights and the list could go on. These variables are not looked at in isolation as the average punter would do, but in combination meaning the research involved with each horse in the field could include over 100 combinations of factors to look at. Times this by the number of horses in one field and by the number of fields in a day and you get the idea why the successful bookmakers always beet the punter and the amount of work that is involved.
Imagine webmasters with this type of dedication and research into their websites and their online decisions. You would be hard pressed to fail if each decision you made had such complete research attached to it. Making poor business decisions (which I have been guilty of) is usually a result of not being diligent and rushing in and by applying the methodology of the successful gambler, in this case the bookmaker you would no doubt improve your success online.
Stick to a plan – All professional gamblers have a comprehensive plan. Not only do they have a system of bets they like to place but also a plan of the size of the bets, the timing of the bets, and most important a number of contingency plans depending on the results of those bets. This allows them to remove emotion from their bets and make rational decisions. Avoiding the gamblers fallacy of betting your way out of a loss is paramount to their long term success.
When I apply this to webmasters, I notice that many webmasters seem to just wing it. They make decisions on the go and the decisions are dependant upon their feelings of that particular day. Having a well researched (see above) plan can allow you to effectively and efficiently allocate your time and efforts to building long term sustainable success.
Confidence – What does research and a comprehensive plan give you? Confidence. And confidence is what you need online. Assuming that all of us have a finite resource to draw upon (or as I like to call it, a “real” job), you need to have complete confidence that the money you are putting in will generate a return sufficient for you to continue. Lack of confidence will lead down a dangerous yet well travelled path of leaping from one idea to the next without seeing any returns and an increasing amount of money invested.
So keep on gambling online not only are the rewards great when you gamble successfully it is also an enjoyable part of many webmasters life. After all is that why we do it? Just consider the strategies applied by successful gamblers and you will be well placed for your next “gamble”