The formula to wealth, as used in Wealth Dynamics, is a simple equation:
Wealth = Value x Leverage
In ‘your life your legacy’, Roger Hamilton uses the flow of water to resemble the flow of wealth. Let’s examine how water flow resembles money flow:
The speed of water flow depends on the gradient. The higher the difference between two points and the steeper the decline, the faster water will flow. Similar things happen with money. If you offer something of a high perceived value, it can create a larger money flow than when you offer something that is of a lower perceived value. You can increase the gradient by increasing the perceived value.
Value is of course relative. And it’s perception is a malleable. In online marketing you will see advertising that tries to increase the perception of value. For example by creating a sense of scarcity in the buyers mind.
Leverage is like the width and depth of a flow of water. Leverage determins how much money can actually flow in business. In online business we seek as much leverage as possible, without any leverage at all, nothing happens even if you have a lot of value to give.
Often, when people are struggling to make money online, they may just be lacking one of these variables. You need both to succeed. Some people are great at creating value, but don’t know how to get leverage. Other people are good at creating leverage, but haven’t created much value.
Online business is actually a great example of why both these variables of value and leverage need to be in place to create real money flow. There are sites that have tremendous value, but no traffic. There are sites that get great traffic but offer little value. And likewise, there are people that are great at making great products, but they don’t know how to drive traffic. Then there are people that are great at driving traffic to a website, but have no products to offer.
If you have your own business, you can up your money flow using the wealth formula by asking either or both of these questions:
1) How can you increase the perceived value of your product or service?
And secondly
2) How can you increase leverage in your business?
If you are thinking about starting an online business, you can ask yourself these questions:
1) What value can I create that satisfies a big need or desire?
And secondly
2) How can I apply leverage to deliver that value?
And if you only know how to answer one part of the equation: partner up with someone who can take care of the other part of the equation!