How To Use ROI To Recognize A Great Business Opportunity!

Return On Investment

Business opportunities are literally everywhere today!  So how do you know if you have found a good one?

Let me start by saying that good business opportunities might look different to you than they do to me, just as good business opportunities for me might look like pathetic opportunities for Donald Trump.  Your current financial situation, as well as, life circumstances and more can make this subject subjective.  However, I believe that there are certain basic principles one should be looking for if they want to live and AWESOME LIFE!

About 10 years ago I was a finance student in college and fully buying into the idea that a degree would make me all the money I wanted and provide me with the lifestyle I dreamed of.  But in reality college is just the beginning of the journey.  If you want to live extraordinarily you must do things different than the other people do.

But let’s get to my point, in finance school I did learn one extremely important and life changing concept, and now I will share this concept with you.  What did I learn you ask?

I learned ROI also known as “Return On Investment”.  Out of the countless hours of study in the campus library, reading tons of books, listening to lecture after lecture, this one formula known as Return On Investment was the most important concept and principle I learned that actually made all the college work worth it.  Even though college alone did not help me to create the financial and lifestyle freedom I now have, it did give me ROI, which was an invaluable piece of the equation that got me started.  In short, I wouldn’t be where I am today without the the Return On Investment formula.

So what is the Return On Investment formula and how can you use it to evaluate business opportunities?

ROI = (Amount of Financial Gain / Total Investment Amount) x 100

Here is a real life example of how I applied this to an opportunity that I was introduced to a little over a year ago.  In 2013 I was still scouring YouTube for business opportunities when I came across an opportunity that has been truly amazing!  The particular opportunity is not the point I’m trying to make, but rather how I knew it was a good opportunity.

I approached a gentleman to help me with this business and asked him questions regarding what type of money he had made with it.  He told me that he of course couldn’t give me exact figures as it is different for everybody, but that he could tell me what he had made.

I took his numbers and calculated the Return On Investment for the opportunity and came out with an estimated ROI of 1100%!!

For those of you not familiar with ROI, this is an absolutely ridiculous Return On Investment as most ROI’s are lucky to be 5-10% if you are investing your money with a financial institution.  So when I saw this incredible ROI I was absolutely convinced that if this opportunity was legitimate, it was the right one for me!

To further illustrate this, when I was investing in mobile homes a few years ago I was hoping for around a 300% Return On Investment which still was amazing, but the problem was that many outside factors derailed me from hitting the 300% ROI.

Now, I’m not saying you must have an 1100% Return On Investment for an opportunity to be a good one, but knowing what type of possible ROI you can make with a business is a very important factor.  Return On Investment at its core is simply how much money will you make on your invested money.

I really hope you enjoyed this blog post.  I will be revealing the other factors involved in recognizing a great business opportunity in future posts!  Make sure to subscribe to our Operation Awesome Life VIP Newsletter so you don’t miss even one of these essential principles!

Have a wonderful day or night and stay tuned for more soon to come!
-Matt