How to Be an “ACE” With Money
f you ever wanted to study the subject of money, then one needs to go no further than Las Vegas. The people who run this town know EXACTLY the basic principles one needs to know to win the game—literally and figuratively. In 2017 it is reported that casinos in Vegas brought in a staggering $26.2 billion in revenue (Velotta, 2018). Here are some more recent statistics on the revenue and profitability of some of these titan casinos.
|Resort||Revenue (ttm)||EBITDA (ttm)|
|Wynn Las Vegas||$1.69 billion||$532.9 million|
|Bellagio||$1.36 billion||$515.4 million|
|Venetian and Palazzo||$1.61 billion||$388.0 million|
|MGM Grand||$1.13 billion||$323.1 million|
SOURCE: COMPANY EARNINGS RELEASES. TTM = TRAILING 12 MONTHS. (Hoium, 2018).
Look, you can argue until you turn blue about the destructive effects these casinos create through their manipulation of the worst of man’s impulses including gambling, sex, and the worship of materialism. But this isn’t an article on ethics (that I will do later)—this is a study on the purest example of how to create a massive amount of wealth, and the three basic abilities one needs to master in order to succeed with money. Las Vegas knows them very well, and that is why they are Money ACEs (pun intended). If you are at all interested in having even a fraction of the massive flow of money that Vegas creates, you should probably know the ACE Trinity of creating wealth.
The ACE Money Triangle
A: Acquisition of Money
Why Vegas wins:
Money is not something you make, it is something you acquire. If you are going to be successful with money, you better have this ability in spades (another bad Vegas reference).
First and foremost, the casinos have a HUGE need for income. Have you seen the size of these places? Can you imagine what the electric costs on a daily basis? The primary reason these places acquire so much money is they simply have a ridiculously high demand for income. The casinos know how to appeal to all of the basic senses and emotions. They know people like shiny objects, big games, expensive clothes, luxurious rooms, fancy drinks, beautiful people, gourmet food, and most importantly, they make people feel special—like a VIP.
All of their marketing and advertising is geared to the people who will drop all inhibitions. They give people permission to be free from restrictions and to enjoy all the vices of life without any responsibility. They know the “buying buttons” and press them 24 hours a day to the tune of billions of dollars a year in revenue. Casinos are wizards at getting attention and creating enough confidence in players to warrant giving away the balance of their checking account.
How this relates to you:
If you want to acquire the amount of money a casino attracts, you must first have a high necessity for money. This means having the CORRECT targets for income. Most business owners drastically underestimate the amount of income they need every month to expand and stay solvent. In addition, most businesses simply don’t spend enough money on marketing and advertising to expand the reach to their audience. Another necessity in money acquisition is that you and ALL your staff need to have sales skills to persuade others to freely give you money for services, including having the know-how to overcome simple objections.
There is no greater missed opportunity than to have lost income you should have acquired. There should be constant awareness of what your client really needs—know their buying buttons. The culture you create should be communicating to their buttons every step of the way on how you will fulfill their needs. If you make your client feel like a VIP (just like Vegas) you will most likely have a client who is willing to double-down and pay you over and over again. Lastly, you must be worthy of trust and create predictability in your service. Attention may get you business temporarily, but if people have confidence in you and your service, they will pay you forever—loyalty equals money.
C: Control of Money
Why Vegas wins:
If one is going to have money, he needs to control it. This means that one cannot let money disperse everywhere. To control money, one must know how to channel it correctly. Vegas casinos are masters at controlling money. The slot machines, the chips, the cameras, the security personnel, and the “eye in the sky” are all there to do one thing: ensure that not $1 goes unaccounted for.
Nobody is more ruthless about their money lines than Vegas. They count money every single day and sometimes as often as 3 times a day. No other industry understands how to control the flow of money better than casinos, and that is why they are ALWAYS profitable and have TONS of cash! It seems as though casinos can create money out of this air.
How this relates to you:
Success or failure with the control of money is about 5% mechanics/95% attitude. The mechanics are simple, you expense EVERY dollar! The moment money comes in, it is channeled somewhere for a purpose. Some of this money will go towards actual expenses, and the remainder will accumulate for future investment. In other words, you incorporate your profit as an expense to ensure reserves will be there when you need them.
In addition, you should have tight control over who has access to your money and who is responsible for the collection and accumulation of your money. You should have an absolute bulldog type person who controls your money line and doesn’t accept any excuses as to why there is no money flowing in. Like Vegas, you should monitor your financial reports at minimum weekly and you should have an advisor who keeps accurate financial metrics of your overall financial scene. The control of money is mostly a mindset, but it’s also about keeping your eye on what’s happening. Do you want to have money or not? Most people that don’t have money simply don’t feel like they can control it and therefore will spend every dollar, allow it to leak, or never collect what is owed to them.
E: Expansion of Money
Why Vegas Wins:
Vegas doesn’t lose money. This is the primary reason why they are able to Expand Money. Make no mistake, it is IMPOSSIBLE to expand your money if you lose it. How do they do it? They don’t make bets in areas they don’t understand. They invest a majority of their profits back into their business to create more luxurious hotels, more slot machines, more advertising, more personnel, and to create other income streams inside their business for further expansion of money. Just look at the pictures of the hotels and casinos 20 years ago. They pale in comparison to the facilities of today. For instance, the Wynn Hotel opened up in 2002 and has since been renovated 3 times. Casino owners invest in what they know because that is the surest way to expand their empire.
How this relates to you:
Far too many business owners will over speculate in areas where they don’t really have control of the outcome. In addition, they will chase other outside income streams like they are chasing butterflies. Instead they should be making their business an income flowing machine AND THEN spend money on the expansion of that business model.
The first rule of expansion is to not lose money you need to invest with. Don’t put so much emphasis on the return you are getting on your reserves. Preserve your reserves so you can invest to expand those areas which move the needle on your net worth. The expansion of money takes a lot of courage. It takes not agreeing with the traditional financial planning model of putting all your bets on the market when it comes to Expanding Money.
Conclusion: You can be a Money ACE. You just have to follow the money mindset these Vegas Casino owners have and apply it. If you can conquer your own mindset, when it comes to money, your household will win!
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Eric Miller, Your BFFF®
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Velotta, R. (2018). Major Las Vegas Strip Resorts Saw
Net Income Triple in 2017. Retrieved from https://www.
Hoium, T. (2018). The Las Vegas Strips Most Profitable Resort.
Retrieved from https://www.fool.com/investing/2018/01/14/