The Entrepreneur’s 5 Limited Resources That Lead to Growth

Five years ago, I had a mentor who said, business is nothing more than the allocation of scarce resources. And I never heard it put in that way before, but it was very interesting, it was very compelling, because as you really think about it, you as the founder, yeah, you only have so much time, so much energy, so much capital, so many people that you can allocate across the different projects, different initiatives that you have. And so how you place those resources will ultimately determine how much leverage you have, and that will, in the end, determine your results. Right. So I wanted to share with you today, five. I held up four, so if you’re watching this on YouTube, I held it four, but I meant five. I’m going to share with you guys five of the scarce resources that you as the founder, you as the entrepreneur, need to be thinking about every single day in terms of how am I allocating this? Am I allocating these as optimally as possible? So, number one is your energy. Now, for a long time, I used to rail against the idea that time is your most valuable asset.

Because time is just a construct of human consciousness. It doesn’t have a basis and objective reality. When somebody comes to you asking you for your time, they’re not actually asking for a unit of time. What they’re actually asking for is your focus, your attention. Hey, can you help me with something? And how you can help them is ultimately determined by what you focus on. Right? So when somebody says, can I get your time? They really want your attention. And so I thought that meant focus or your attention is your most valuable asset. And in a lot of ways, it’s very important, but it’s not the first principles, foundational piece of the puzzle.

It’s not the most important thing. There’s actually something that even precludes focus, and that is your energy. See, without energy, you have no focus, right? You don’t have the ability to go and expend attention towards an outcome. Now, we know that there are different qualities of energy, different quantities of energy. If you have a good night’s sleep, you’re waking up and you’re very energized, and you have a great abundance of energy. And your focus, therefore, is great. And the results that you are able to drive are excellent. On the flip side of that, when you get a bad night’s sleep, when you don’t, are not eating well, let’s say you come back from lunch after a really carb heavy lunch, and now you’re sleepy, you’re going in and out of the food coma.

So your energy is of a different quantity and of different quality. So the quality of our focus dictates the quality of our results. And that is ultimately determined by the levels and quality of our energy. And so that’s the most scarce resource, the most limited resource that you as the founder have to expend, especially in the beginning, when it’s just you and you don’t have so much of these other four resources. Now, the three levers of energy I’ll just throw out right now. But you should go and listen to the other episodes that we’ve talked about. These, we’ve broken each one down into greater detail in past episodes. But the three levers of energy that you have for increasing the quantity and quality of your energy is your sleep, your exercise, your nutrition, get those dialed in.

Everything gets a whole lot easier. That will maximize your energy, and it will optimize your energy. Number two, the second limited resource that you as an entrepreneur have are your skills. How skilled you are at a thing dictates how well you can do it, and ultimately the results that you get from that. Now, in the beginning, you might not have a lot of skills. You might have a very limited scope of skills within a very particular domain. Maybe it’s the service, the product that you’re developing. Maybe you had some history with that thing.

Maybe it’s graphic design, for example, accounting. Maybe you’re a great lawyer, and so you have that skill. It’s very great. But there’s all these other skills within a business that you need, like marketing, finance, human resources, operations, right? All these different skills. And so your skills are a limited resource. And the more that you can build those up, the more you’ll have to be able to allocate. But then also the better leverage you’ll be able to get out of those skills. The third resource that you have available to you are people, assuming that you’re hiring people, which you should be.

Because the truth is, I don’t believe, I actually think the idea of a one person business is a misnomer. There is no one person business that’s just a job if it’s just you in the business. If you’re the one that is doing all of the lead generation, all the converting of customers, of the delivery of the product, if you’re doing all that stuff, that’s not a business, that’s just a job. If you can’t leave, if you can’t step out of the machine, you don’t have a business. A business is a machine that’s capable of running and growing without you, it has systems, processes that you can plug people into. That’s a business. And so if you want to have a business, you need to, you need to work on your ability to work with and through other people. So people labor, that is one of the scarcest, most limited of resources, but can be one of the most valuable.

And how you hire to replace yourself within the hierarchy of a business and what roles you outsource first and how you manage those people is going to dictate a lot of how well you grow ultimately. And it’s the most important linchpin in ultimately getting you out of the business. Not a bad thing to be thinking about, right? All right. The fourth limited resource that we have at our disposal is capital. Now, in the beginning, you don’t have a lot of money. You maybe saved up six months to a year’s worth of expenses before you took the leap into your business. Maybe you waited until you, you were cash flowing positive from your business to be able to leave. So now you have cash flow coming in, but maybe it’s not as much as you want, right? Like, it’s maybe not hundreds of millions of dollars.

You’re not like, swimming in abundance here. So you have a limited amount of capital that you have to figure out. How do I allocate? Do I use this to fund my lifestyle? Do I use it to put into savings? Do I take this and reinvest it back into growth in my business? How you reallocate your capital is a very hard question to answer, and it’s very contextual to the entrepreneur and to the situation. But it’s one of the most important that you can answer, because how you allocate your capital will ultimately determine how much of a safety net you have, how comfortable psychologically you feel, and how quick you ultimately can grow. So the final resource, limited resource that we as entrepreneurs have to allocate are our tools, and that is our equipment, that’s our technology and the things that you have around you, your equipment. Right. How are you using the things that you have? Your computer, your. That machine over there.

Right. That software that you’re using? How you allocate those resources is going to ultimately determine a lot of the leverage that you get, because that’s what tools ultimately allow us to do. They give us leverage. The better tools we have, the better able and more skilled we are at using those tools. And now that’s combining two of our limited resources. Now we’re going to be able to compound the results we’re ultimately able to get. So those are five of the limited resources. You got skills, you got your energy, people, capital, and your, I guess you could say resources, but we’ll call them tools.
So think about those today. How am I allocating my energy, my skills, my people, my capital, and my tools? Am I doing so in an optimum fashion? Is there one of these that stands out to you as severely lacking? Because usually, and usually in every business, there’s a. There’s a constraint. It’s going to be one of these, like, oh, energy. I’m feeling burnt out. I’m always tired. I don’t. I can’t show up or skills.

I’m not very good at these things. Or. And that’s because I don’t have people around me, and that’s because I don’t have the capital to allocate towards hiring the people who would have the skills, who would free up the time so I’d get the energy back. Right. So you can see how this becomes kind of a snowball effect. Right? But not all problems go back to capital. It’s very easy just to default to saying, I just don’t have the money. That would allow me to buy the tools, get the people, acquire the skills.

Don’t use that as the excuse. Sometimes. A lot of cases it is. However, as Tony Robbins said, you don’t lack for resources, you lack for resourcefulness. So though you might not have the capital, don’t let that be the excuse. Now that’s going to do it for me. Guys and gals, I hope this gives you a new framework for thinking through your life and through business. And if it does, let me know.

Take a screenshot of whatever you’re listening to this. Share it on Instagram. I’ll reshare it with my community. They’ll get more eyeballs on you and your business, and it’s great. Win win for everybody, as it helps spread the word of the podcast so it can help more entrepreneurs to maximize their return on life. That’s gonna do it for me. Thank you. I’ll catch you in the next episode.