Gaining Wisdom from Dave Ramsey

By Dayna Steele on Jan, 25 2012

Financial guru, best-selling author and top-syndicated radio host Dave Ramsey just added another best-seller notch to his financial belt. His latest chart topper is EntreLeadership: 20 Years of Practical Business Wisdom from the Trenches, based on the core principles of how Ramsey grew his company: debt-free.

As a self-professed Ramsey groupie myself, I couldn’t think of a better Rock Star Conversation to kick off the New Year:

STEELE: What is EntreLeadership?

RAMSEY: EntreLeadership describes the passion and creativity of an entrepreneur combined with sound leadership principles. Most small business owners are really good at one or the other. In teaching the principles to business owners, we help them narrow down their strengths and weaknesses to help them hire the right people and grow their business.

STEELE: Often you hear people say 'you have to spend money to make money' —they don't say 'take out a loan.' How do you advise companies to succeed and stay debt free?

RAMSEY: The biggest reason small businesses fails is because they grow too quickly. You’ve got to grow slow and avoid debt. In business, you’re going to make mistakes. And if you have debt, the mistakes are magnified. So if you have debt on your business, get on a plan to get rid of it. Then, avoid debt at all costs! Rent, outsource, do whatever it takes to grow slow. Every time I read the book, “The Tortoise and the Hare,” the tortoise wins.

STEELE: How do you feel about business plans?

RAMSEY: You have to have a plan for your business, know who you are and, more importantly, whom you serve. It will keep you on track and help you concentrate on what you are good at.

STEELE: When it's time to grow a company, what positions do you advise leaders to fill first?

RAMSEY: This depends on the business you’re in and your own strengths as an EntreLeader. If you aren’t good at accounting, then your first hire should be a bookkeeper. In our business, the first person I brought on board was a financial counselor because I physically couldn’t handle the demand alone.

STEELE: In EntreLeadership, you highlight recognition and inspiration as great ways to get the best out of your people. Why do you think so many so-called leaders still treat employees poorly but expect their best?

RAMSEY: The Golden Rule applies even in business. How can you expect your team to perform to their potential if you’re constantly micro-managing and dragging them down? Treat your team members like you would want to be treated.

STEELE: Technology is changing the way companies market, what is great marketing?

RAMSEY: Marketing is really the overall plan that gets the product or service to the customer. With technology you can bring quality products to the market faster right now with Twitter, Facebook and YouTube. There are great ways to get the stuff out there.

STEELE: What would you say to company leaders about using social media?

RAMSEY: You’re crazy not to use it! It’s free. Back when I started in the 80s we struggled to get the word out that we even existed. Today, you don’t need marketing dollars when you’re first starting out, you can easily use social media to bring in business.

STEELE: You came late to the Twitter party but seem to have embraced it wholeheartedly; why?

RAMSEY: Like the radio show, it’s great to interact with people directly. Twitter can bring big results to your business for a small commitment.

STEELE: Most important thing a leader should do to grow his or her business?

RAMSEY: Hire slowly. This is one of the biggest mistakes small business owners make because they’re covered up and just need the help. So they hire the first person that comes along, only to create more problems down the road. Take time to hire. Get the right people on the bus. At our place, we have a 12-step process to get hired and a low turnover rate as a result.

STEELE: Who’s your favorite rock star and why?

*Alas, my financial hero is a country fan and declined to answer this question.

In closing, as we kick off 2012, I wanted to leave you with my personal Dave Ramsey story:

In late 2004, I informed Charlie the Wonder Husband that I was miserable at work and wanted to come home to spend more time with the kids and go back to freelancing in PR and marketing, maybe doing the occasional voiceover if I was lucky.

Crazy? You bet! I was asking to leave a six-figure job with all expenses included, a matching 401K, all health benefits and the freedom to come and go as I pleased. We had two car payments as well as a couple of credit card balances and a boat payment. Despite all that, I knew I needed to work for myself and get the creative juices flowing once again. Corporate America just wasn’t the right cup of tea for this former rock and roll radio chick.

We sat down that night, took a serious look at finances and began to cut costs like crazy. We found a new home for the nanny, traded the two sports cars in on a much cheaper, more practical car and didn’t buy a thing unless we absolutely needed it. Friends and family thought we (I) were crazy. And boring.

Fast-forward six months. The freelance business picked up much faster than I could have ever dreamed and we had already paid off one car, the boat and one credit card.

Then, another man came into my life…I heard Dave Ramsey on the radio. From that moment on, we knew we weren’t crazy but actually onto something and attacked debt and savings even harder.

Today? We are still debt free and are working to pay off the house before our last one graduates from high school. College, savings, the emergency fund, and our retirement accounts are funded. Now, we are able to buy gadgets and have the occasional expensive meal without guilt or breaking out into hives. We still pay cash for everything, including cars.

The best part? We are able to give to others—we’ve adopted an at-risk middle school class, bought books for underprivileged kids for the holidays, can donate when friends compete in charity sporting events, and the list goes on.

Thank you Dave. We like your kind of crazy.

Dave Ramsey is a personal money-management expert and extremely popular national radio personality. His syndicated radio show is heard on more than 450 stations across the country. His four New York Times best-selling books—Financial Peace, More Than Enough, The Total Money Makeover, and EntreLeadership—have sold more than 6 million copies combined. Dave’s latest book, EntreLeadership: 20 Years of Practical Business Wisdom from the Trenches, debuted at number one on the New York Times best-selling list.

Dayna Steele is a Hall of Fame radio personality, successful entrepreneur, the best-selling business author of Rock to the Top: What I Learned about Success from the World’s Greatest Rock Stars, sought-after speaker and in-demand business consultant and media strategist. Readers’ Digest Magazine has called her one of the “35 People Who Inspire Us.” Successful Meetings Magazine calls her presentations “a pep talk from the deejay booth.” Talkers Magazine said she was one of the “100 Most Important Talk Radio Show Hosts.” And, AOL Business named her “one of the foremost experts on career networking.” Follow her on Twitter @daynasteele or visit http://www.daynasteele.com/. She is currently working on her forthcoming book 101 Ways to Rock Your World: Everyday Activities for Success Every Day.

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