Thoughts of an Entrepreneur: Don’t Put All Your Eggs in One Basket

When I worked as an employee for big organizations, I noticed a common system.  The strategy to earn more is to create multiple projects and business development initiatives simultaneously. The unmentioned game plan has been:

“Don’t put all your eggs in one basket or you could lose everything.”  

Sometimes, this set-up can be tiring especially if the team assigned to launch a new venture is still watching the first project grow.  People will then wish there was more focus.  However, we can’t judge if the decision makers made a right or wrong choice, I thought. Most organizations are inclined to diversify.

Relating this story with our personal lives, you and I have jobs or income sources in a way.  There also comes a point when we need to decide whether to focus on one thing or to engage in many ventures to address our financial needs.  

Mag-iinvest ba ako sa isang stocks or maraming stocks?  Kailangan ko bang mag-resign para magsimula ng negosyo, o kaya kong pagsabayin?  Gagamitin ko ba lahat ng naipon ko para sa kapital?

I researched quotations about “not putting eggs in one basket” to validate if diversification is a way to go. Surprisingly, I found versions of the saying from prominent men who believes otherwise.

“Put all your eggs in one basket and then watch that basket.” – Mark Twain, author and entrepreneur

“Keep all your eggs in one basket, but watch that basket closely.” – Warren Buffet, business magnate

“Conventional wisdom is not to put all of your eggs in one basket. But choose a basket carefully, load all your eggs into it, and then watch it like a hawk.”  Richard Koch, speaker and investor

“Concentrate your energies, your thoughts and your capital. The wise man puts all his eggs in one basket and watches the basket.”Dale Carnegie, author and performance coach

Come to think of it, laser focused energy towards an initiative that generates results is worth pursuing.  Richard Branson on a blog for entrepreneur.com also agrees. “Focus your time and energy on one business, learn the ropes, then expand – you’ll thank yourself later.”  

Unlike the veterans who quoted about focus, the younger generation of entrepreneurs seem to have another opinion.  With today’s technology, they seem to be able to monitor many investments at once.

To put all of your eggs in one basket is silly. We did that for a long time and I don’t think it’s very smart.– John Kasich, politician and TV host

“If we do not micromanage and have the ability to delegate, we can do multiple projects at once.  Technology, realistic planning and effective communication helps.”   – Andrew Filev, Founder and CEO of Wrike

“You can build every successive business faster than the one before.” – Neil Patel, digital marketing strategist Entrepreneur.com

“Running multiple projects speeds up results.” – Vishen Lakhiani, founder of Mind Valley

I currently have multiple projects but these are spread out on my calendar for the whole year so I can supervise one or two at a time.  The problem of balancing after a series of trouble shooting in my business made me came about this topic.  I felt the need to focus after attempting to invest on several income stream at once.  

In my opinion, the two strategies of focus and diversification may be applicable on different situations. Here are some suggestions to consider:

Always test the basket.

Do not put all your money or savings unless you are sure that your investments will yield a return.

The size of the eggs is determined by the return you get.

If you have gained profit for a business or initiative, that’s the time you can put more money to fund it.

Consider timing.

If you are a starting investor or entrepreneur, you need to gain skills and wisdom before venturing into several projects at once.  Find someone to mentor you and make sure to have your emergency fund ready.  A new business will require you funding not just on the launch stage but even more in its growing stage.

As for the number of projects, I have the following philosophy: I have two hands, and I can only manage two baskets at once.  The one basket has big eggs (a business or job that has bigger returns but needs longer time for reaping); the other basket has small eggs (smaller income and easy returns).  

Now, which side do you take?  

Jonah Chipeco is a resource speaker, marketer and writer. She believes that effective writing skills act as enabler in any business and shares her knowledge among young professionals through seminars and e-books. As an entrepreneur, she has been managing an online store and events company since 2011. Visit her website jonahchipeco.com or add her on LinkedIn.

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