Finding Your Acre of Diamonds

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Over 130
years ago, a Baptist minister, Russell Conwell, gave a speech.
It became known as "Acres of Diamonds." It became perhaps
the most famous speech of his era, 1870—1920. He delivered
it approximately 6,000 times, all over America. That was back
when there was no commercial radio. Through most of the era, there
were no movies. Speeches constituted both entertainment and education.
Conwell’s speech is a perfect example of this dual function.

I regard
it as the original motivational speech on money. He made a great
deal of money from this speech. He made so much money that he
was able to supply much of the initial funding of Temple University
in Philadelphia. This is why Temple
keeps his speech on its website
.

The speech
is still in print. It still has readers. But, on the whole, it
is forgotten. The general public no longer reads much. There is
nothing like the Chautauqua circuit, where speakers spent the
summer lecturing from city to city in front of huge audiences — in
the era before microphones. William Jennings Bryan was the most
famous Chautauqua speaker, but Conwell was close behind.

If you ever
read the entire speech, you will be impressed by its irresistible
quality. But Americans are no longer familiar with great public
speaking. The thought of one man on a distant stage keeping a
thousand or more people in rapt attention by means of a speech
as long and detailed as Conwell’s is hard to imagine today. Other
than a weekly sermon, the details of which are forgotten by evening,
no other form of public speaking is familiar to modern adult Americans.
Yet people came back, over and over, to hear this speech. This
amazed Conwell.

I AM ASTONISHED
that so many people should care to hear this story over again.
Indeed, this lecture has become a study in psychology; it often
breaks all rules of oratory, departs from the precepts of rhetoric,
and yet remains the most popular of any lecture I have delivered
in the fifty-seven years of my public life.

RIGHT
IN YOUR OWN BACK YARD

The speech
begins with his account of a story teller on a boat in the Middle
East. The man told of a rich man who sold his land and goods in
order to go in search of diamonds. The man who bought his land
found diamonds in the back yard.

This was
a great opening for a speech, but it was merely the hook. The
examples that he used to illustrate his point were what grabbed
people’s attention and, in some cases, their vision. He was a
visionary. He was recruiting visionaries.

His speech
is a good example of his thesis. He turned into a multi-million
dollar career what had been a pleasant little story told to a
tourist. Conwell’s back yard was his mind. He took the original
story and turned it into a cottage industry. He found the diamonds
at home, but he marketed them all over America. Then he took the
money home and built a hospital and what later became a university.
These "diamonds" he distributed in Philadelphia’s back
yard.

His basic
point needs to be learned by entrepreneurs in every generation.
Most businesses are local. Most jobs are created by local businesses.
Most American millionaires made their money by starting a business
and building it. The huge industries get the public’s attention,
but they are not the driving force of economic growth. Successful
small businesses are — after the majority of start-ups have failed.

That’s why
I keep coming back to Conwell’s theme: the entrepreneur should
keep his attention focused on what his neighbors are buying or
unable to buy. He should search for niches in his town that are
not being filled by high-quality sellers. Buyers want to be served,
but they are having trouble getting decent service locally. The
best and the brightest of our children have been sent to college
by parents who do not understand that a standard B.A. degree in
the liberal arts is not nearly so lucrative as a certificate in
plumbing or heating/air conditioning.

It’s not
that small businessmen can’t use a college degree. It’s that the
typical college degree program creates a mind-set that is bureaucratic:
read this book, write this paper, pass this exam, and you will
be given a certificate to the good life. These days, with one-third
of all American high school graduates starting college (50% never
finish), the college degree is barely a hunting license.

If bright
students went into small businesses in their home towns and never
left town, they would lock in their financial future by age 35,
and lock in their leadership position by age 50. Nobody stays
put any more. So, leadership passes to those people who just show
up for 30 years.

THE
MAN WHO WOULD BE JED CLAMPETT

Conwell told
this choice story. It has to do with a typical diamond-seeker,
who had considerable book knowledge.

There was
a man living in Pennsylvania who owned a farm here and he did
what I should do if I had a farm in Pennsylvania — he sold it.
But before he sold it he concluded to secure employment collecting
coal oil for his cousin in Canada. They first discovered coal
oil there. So this farmer in Pennsylvania decided that he would
apply for a position with his cousin in Canada. Now, you see,
the farmer was not altogether a foolish man. He did not leave
his farm until he had something else to do.

OF ALL
THE simpletons the stars shine on there is none more foolish
than a man who leaves one job before he has obtained another.
And that has especial reference to gentlemen of my profession,
and has no reference to a man seeking a divorce. So I say this
old farmer did not leave one job until he had obtained another.
He wrote to Canada, but his cousin replied that he could not
engage him because he did not know anything about the oil business.
"Well, then," said he, "I will understand it."
So he set himself at the study of the whole subject. He began
at the second day of the creation, he studied the subject from
the primitive vegetation to the coal oil stage, until he knew
all about it. Then he wrote to his cousin and said, "Now
I understand the oil business." And his cousin replied
to him, "All right, then, come on."

That man,
by the record of the country, sold his farm for eight hundred
and thirty-three dollars — even money, "no cents."
He had scarcely gone from that farm before the man who purchased
it went out to arrange for watering the cattle and he found
that the previous owner had arranged the matter very nicely.
There is a stream running down the hillside there, and the previous
owner had gone out and put a plank across that stream at an
angle, extending across the brook and down edgewise a few inches
under the surface of the water. The purpose of the plank across
that brook was to throw over to the other bank a dreadful-looking
scum through which the cattle would not put their noses to drink
above the plank, although they would drink the water on one
side below it.

Thus that
man who had gone to Canada had been himself damming back for
twenty-three years a flow of coal oil which the State Geologist
of Pennsylvania declared officially, as early as 1870, was then
worth to our state a hundred millions of dollars. The city of
Titusville now stands on that farm and those Pleasantville wells
flow on, and that farmer who had studied all about the formation
of oil since the second day of God’s creation clear down to
the present time, sold that farm for $833, no cents — again I
say, "no sense."

These are
rare stories. Most men never get rich. Most men are not sitting
on top of an oil field. But no man is sitting in the midst of
a world that has no needs to fill, no desires to placate, and
no services to be rendered. There is a special something that
a successful entrepreneur has, or at least had once, that the
rest of us don’t have. But when someone normal decides that he
is going to be a servant, it’s amazing how many opportunities
to serve pop up without warning.

Money is
a tool. It is the most marketable commodity. I have no doubt that
some people are so gifted that they can invent great gadgets.
But without capital, a great idea cannot be put into mass production.
The idea is crucial, but so is capital. This is what Conwell taught
in nineteenth-century language.

Love is
the grandest thing on God’s earth, but fortunate the lover who
has plenty of money. Money is power: money has powers; and for
a man to say, "I do not want money," is to say, "I
do not wish to do any good to my fellow men." It is absurd
thus to talk. It is absurd to disconnect them. This is a wonderfully
great life, and you ought to spend your time getting money,
because of the power there is in money. And yet this religious
prejudice is so great that some people think it is a great honor
to be one of God’s poor. I am looking in the faces of people
who think just that way.

I heard
a man once say in a prayer-meeting that he was thankful that
he was one of God’s poor, and then I silently wondered what
his wife would say to that speech, as she took in washing to
support the man while he sat and smoked on the veranda. I don’t
want to see any more of that kind of God’s poor. Now, when a
man could have been rich just as well, and he is now weak because
he is poor, he has done some great wrong; he has been untruthful
to himself; he has been unkind to his fellow men. We ought to
get rich if we can by honorable and Christian methods, and these
are the only methods that sweep us quickly toward the goal of
riches.

Conwell was
never trapped by the riches he generated. He gave away a fortune
more than once. He did so day by day, supporting students. Then
he gave in big chunks. But he had it to give away. He was a rarity:
a man who knew how to give away money as efficiently as he made
it.

MAKING
IT

There are
millions of people who dream of being rich. I pity them all. They
should dream of getting rich. The challenge is in the getting.
So is the self-discipline that getting rich requires. Conwell
saw this clearly.

But there
are ever coming to me young men who say, "I would like
to go into business, but I cannot." "Why not?"
"Because I have no capital to begin on." Capital,
capital to begin on! What! Young man! Living in Philadelphia
and looking at this wealthy generation, all of whom began as
poor boys, and you want capital to begin on? It is fortunate
for you that you have no capital. I am glad you have no money.
I pity a rich man’s son. A rich man’s son in these days of ours
occupies a very difficult position. They are to be pitied. A
rich man’s son cannot know the very best things in human life.
He cannot. The statistics of Massachusetts show us that not
one out of seventeen rich men’s sons ever die rich. They are
raised in luxury, they die in poverty. Even if a rich man’s
son retains his father’s money, even then he cannot know the
best things of life.

The creativity
is the joy of the entrepreneur. The profit, if any, serves as
a feedback device. He knows that he has served others efficiently.
But rare is the entrepreneur who produces just for the money.
If he did, then he would quit after he accumulated enough money
to retire. Most of the entrepreneurs I have known work until they
die, usually as old men. The money is their means of doing things
bigger and better. It is capital, not an end in itself. It allows
them to create. They thrive on creativity.

So should
we all.

WHAT
DO PEOPLE WANT?

Conwell told
another story, this one about a young man who started out with
almost nothing. He made an early mistake. That mistake taught
him a great lesson. He went on to accumulate a fortune —
in today’s purchasing power, over $800 million.

ARE YOU
POOR? It is because you are not wanted and are left on your
own hands. There was the great lesson. Apply it whichever way
you will it comes to every single person’s life, young or old.
He did not know what people needed, and consequently bought
something they didn’t want, and had the goods left on his hands
a dead loss.

A. T. Stewart
learned there the great lesson of his mercantile life and said
"I will never buy anything more until I first learn what
the people want; then I’ll make the purchase." He went
around to the doors and asked them what they did want, and when
he found out what they wanted, he invested his sixty-two and
a half cents and began to supply a "known demand."
I care not what your profession or occupation in life may be;
I care not whether you are a lawyer, a doctor, a housekeeper,
teacher or whatever else, the principle is precisely the same.
We must know what the world needs first and then invest ourselves
to supply that need, and success is almost certain.

Now, for
every A. T. Stewart there are many, many failures. In The
Millionaire Mind
, we learn that failures are basic to
most millionaires’ experience. They have a lot of them. But, like
the Energizer Bunny, they keep coming back. It’s not the A. T.
Stewarts who make the world rich. It’s the would-be A. T. Stewarts
who never make it big, but whose efforts to serve us improve our
lives by expanding our options.

Don’t try
to sell people what they don’t want. To do so is the mark of a
fanatic, one who will remain poor. Trying to sell people what
they don’t want is an exercise in futility: wasted breath, capital,
and life. Sell them what they want, and then use your profits
to give them what you think they need. Even giving it away will
create resistance. But maybe you can re-package it and sell it
at a steep discount. This is even more likely if they think they
have snookered you.

The mark
of a man destined to remain middle class despite his long hours
of work and dedication to the task is the person’s inability to
listen. He does not listen when people with money tell him what
they want to buy. He is determined to sell them what he wants
to sell. He would rather not get rich than get rich by adjusting
to what people are willing to pay him to provide. He wants to
get rich by having people reward him by buying whatever he has
to offer. He regards riches as visible confirmation of his own
decision to do things his way. Meanwhile, the rest of us —
self-centered as we are — prefer to reward people for doing
what we want them to do. The person with money holds the hammer:
the most marketable commodity. He who pays the piper calls the
tune. But there are a lot of pipers out there who want to play
their tunes and get paid.

I have a
friend, now my associate, who has identified a universally desired
service for which consumers are paying billions a year. The consumers
must have this service. My friend discovered from another entrepreneur
how to adapt a production technique used 150 years ago, but which
was abandoned because of government interference — not outright
prohibition, but tremendous pressure through licensing. He found
a niche area of the market which, while regulated, does not prohibit
firms that apply this ancient production technique. By doing this,
he went from unemployment in 1991 to a business with multiple
branches that is grossing $1.4
million a year and a real estate mini-empire that appreciates
by $100,000 a year
.

He is not
imitated by competitors because the suppliers are doing it the
government’s way. The government’s recommended production system
is woefully inefficient because the government’s unions want it
this way. My friend moved into a niche where there is little government
money and no unions. It was the same in Conwell’s day, long before
the Wagner Act and the National Labor Relations Board.

I know
that the labor unions have two great problems to contend with,
and there is only one way to solve them. The labor unions are
doing as much to prevent its solving as are capitalists today,
and there are positively two sides to it. The labor union has
two difficulties; the first one is that it began to make a labor
scale for all classes on a par, and they scale down a man that
can earn five dollars a day to two and a half a day, in order
to level up to him an imbecile that cannot earn fifty cents
a day. That is one of the most dangerous and discouraging things
for the working man. He cannot get the results of his work if
he do better work or higher work or work longer; that is a dangerous
thing, and in order to get every laboring man free and every
American equal to every other American, let the laboring man
ask what he is worth and get it — not let any capitalist say to
him: "You shall work for me for half of what you are worth";
nor let any labor organization say:

"You
shall work for the capitalist for half your worth."

Be a man,
be independent, and then shall the laboring man find the road
ever open from poverty to wealth.

Find what
people want, and sell it to them. Just find ways to do it cheaper.
Cut your costs. Pocket the difference. Do it again. This was Conwell’s
message.

He who
can give to this people better streets, better homes, better
schools, better churches, more religion, more of happiness,
more of God, he that can be a blessing to the community in which
he lives tonight will be great anywhere, but he who cannot be
a blessing where he now lives will never be great anywhere on
the face of God’s earth.

November
3, 2003

Gary
North [send him mail]
is the author of Mises
on Money
. Visit http://www.freebooks.com.
For a free subscription to Gary North’s newsletter on gold, click
here
.

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