Have you ever wondered if making the investment into a coach is worth it?
This is usually when we talk about risk vs reward. I know that, personally, it took me a long time to realize the risk vs reward statement. Maybe it wasn’t explained to me properly, or maybe it didn’t click when it was explained before, I don’t know.
But, if anybody is in the same boat that I was in, here is a little exercise that can help you think about it. It’s something I use quite regularly so I hope it helps outs. By the way, this can be really helpful when making decisions about big investments. Sometimes, it can feel scary to drop a few grand on a coach when you aren’t sure of the results. So, think of the risk vs reward.
Firstly, I want you to think of each item as an individual and not related to others. For example, getting a branding coach should not influence you getting a brand designer. The two are related and one can be dependent on the other, but when it comes to figuring out the risk vs reward, I want you to separate them.
Now, imagine a line scale with three points.
The one in the middle is where you are now. This is also where you are to remain if you don’t make that investment (when we take out other investments or influencing factors).
The one on the right is the best-case scenario – this is your reward. This is if you make the investment and what the final result will be. Hint. These are the marketing, goal setting, and expected result statements you see when purchasing a service or product.
The last point on the left is the worst that could happen if you make this investment – your risk. And I mean the worst thing possible for both you as an individual and your business at this time. Yes, it is important to keep a timeframe in mind.
For really big investments, I like to use this line and actually write down every single thing under each point that I can think of. For example, the middle point would include save money and don’t have X as part of my business. The risk point would have loose X amount of money and don’t have X as part of my business. And the reward point would be don’t have X amount of money and don’t worry about this part of my business for the next X years.
If this hasn’t already helped you make a decision, here is one other thing you can do with this line.
Start coming up with plans on how to recover if the worst thing possible happened.
Consider what would be harder for you, as both an individual and a business – to do all the steps in your recovery plan or to stay in the exact same spot you’ve been up until now.
Consider if it is possible for your recovery plan to get you your reward (or closer to it than your starting point).
And lastly, consider what would be harder for you to bear – having to go through that recovery plan or not taking action.
PS. You can also add points in between all of these. For example, ask yourself what would be a good outcome for you even if you don’t achieve the final goal completely or what would be a bad situation, but not the worst possible thing. For the reward side, consider social proof, testimonials, and personal experience to see where you are most likely to fall. For the risk side of the scale, write a recovery plan for each point.
And there you have it. You have properly weighed the risk vs the reward and you will have a more informed way of making your decision.
Honestly, using this scale has helped me a lot on both making huge investments AND not making frivolous investments. Sometimes, that $10 deal is a bigger waste of my time than the reward I’d get. And sometimes, I can learn so much from that $1,000 investment that even if I don’t reach the reward, it feels worth it.