The Path to Success: Insights from Observing Founders and Real Estate Trends

tong jiang

Hatched by tong jiang

Feb 05, 2024

3 min read

0

The Path to Success: Insights from Observing Founders and Real Estate Trends

Introduction:

When it comes to achieving success, whether it be in creating something significant or amassing great wealth, there are certain commonalities that can be observed. This article explores the key factors that contribute to success, drawing insights from the experiences of founders and the trends in the real estate industry.

Connecting Success and Real Estate Trends:

The real estate industry has long been analyzed through the lens of "long-term population, mid-term land, and short-term finance." While the latter two factors have predominantly driven China's real estate boom in the past two decades, the "long-term factor" of population is now starting to have an impact. This is evident in countries like Italy, where urbanization rates reached 65% in 1970 and remained stagnant for over half a century. The collapse of Japan's property market is also a notable case, with Tokyo's prices taking 30 years to recover. These examples challenge the notion of "long-term price appreciation" and highlight the importance of considering population dynamics in real estate trends.

Lessons from Li Ka-shing:

Renowned investor Li Ka-shing's investment style reflects a cautious approach towards risks. His philosophy of "not earning the first copper coin, as it is easy to become a martyr, nor earning the last copper coin, as it is easy to become a ghost" demonstrates his aversion to extreme risks. This mindset sets him apart from other real estate developers. Li Ka-shing's investment decisions have been driven by a keen sensitivity to risk, which has proven to be one of the key factors contributing to his success.

Population Dynamics and Urbanization:

Italy's urbanization rate plateaued at around 65-70% for over half a century. However, in the 1990s, Japan experienced a period known as the "Lost Decade." Surprisingly, during this period, from 2000 to 2010, Japan's urbanization rate increased by 12 percentage points, reaching 91%. This phenomenon, known as "passive urbanization," resulted from the mass decline of elderly rural populations, which led to a significant adjustment in the distribution of the population. Rural areas became depopulated while smaller cities underwent transformation. This highlights the importance of considering both active and passive urbanization when analyzing population dynamics.

Li Ka-shing's Forward-Thinking Investments:

Following the opening up of China's economy, Li Ka-shing initially adopted a cautious approach. However, as policy certainty increased in the 1990s, he began investing extensively in mainland China. Notably, he was one of the first to "divest" when other Hong Kong businessmen were still deeply entrenched in the Chinese market. This bold move attracted significant attention, with the phrase "Don't let Li Ka-shing run away" becoming a hot topic of public discourse.

Actionable Advice for Success:

  • 1. Embrace a long-term perspective: Success is often achieved by focusing on creating something of value rather than solely pursuing financial gains. By taking a long-term view, you can prioritize the importance of your work and make a lasting impact.
  • 2. Understand population dynamics: When analyzing trends in any industry, it is crucial to consider the influence of population dynamics. Changing demographics can significantly impact markets and present new opportunities for success.
  • 3. Be adaptable and forward-thinking: The ability to recognize emerging trends and adapt accordingly is a key trait of successful individuals. Don't be afraid to make bold decisions and stay ahead of the curve.

Conclusion:

Success can be achieved by combining a long-term perspective, understanding population dynamics, and embracing adaptability. By observing the experiences of successful founders like Li Ka-shing and analyzing trends in industries such as real estate, we can gain valuable insights that can guide us on our own path to success. Remember, success is not solely measured by financial gains but also by the impact we create and the value we bring to the world.

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