Teardown of The Wolf of Wall Street Initial Penny Stock Script The scene from The Wolf of Wall Street where Jordan Belfort makes a cold call to John, trying to pitch a penny stock, is a perfect example of high-pressure sales tactics. Let's examine the conversation and break down the different techniques Belfort uses to try and sell his prospect on the idea of investing. The Pitch: 1. Establishing Rapport: Belfort opens the conversation by asking how John is doing, and then references the postcard John had sent in requesting information on penny stocks. By mentioning a previous interaction, Belfort is trying to build trust and establish rapport with John. 2. Creating Urgency: Belfort tells John that he has something new that just came across his desk and is perhaps the best opportunity he's seen in the last six months. By creating a sense of urgency, Belfort is trying to get John to act quickly and not miss out on a potentially lucrative opportunity. 3. Highlighting Potential Gains: Belfort introduces the name of the company, Aerotyne International, and tells John about its new radar detector technology that has huge military and civilian applications. He then mentions that the stock is currently trading at ten cents a share, but that it could go a lot higher. By highlighting the potential gains, Belfort is trying to entice John with the idea of making a large profit. 4. Using Social Proof: Belfort tells John that his analyst indicates that the stock could go a lot higher, which implies that other experts in the field are also bullish on the stock. By using social proof, Belfort is trying to convince John that this is a smart investment choice. 5. Minimizing Risk: Belfort mentions that even if the stock doesn't perform well, he doesn't ask his clients to judge him on his winners, but rather on his losers, of which he has very few. By minimizing the risk and suggesting that his success rate is high, Belfort is trying to make John feel more comfortable with the idea of investing. 6. Asking for the Sale: Belfort asks John for a small investment of four thousand dollars, which would buy 40 thousand shares of the stock. He then tries to lock in the sale by saying he will get back to John with a confirmation from his secretary. By asking for the sale and making it easy for John to say yes, Belfort is trying to close the deal and make the sale. In conclusion, the conversation between Jordan Belfort and John in The Wolf of Wall Street is a perfect example of high-pressure sales tactics. By using techniques such as establishing rapport, creating urgency, highlighting potential gains, using social proof, minimizing risk, and asking for the sale, Belfort tries to sell John on the idea of investing in a penny stock. While these tactics may work in the short term, they are highly unethical and ultimately harmful to the consumer. It's important for salespeople to be aware of these tactics and to always act with integrity and ethics in mind. ## A Moment for the Guy on the Other End of the Call I think that while this particular scene from the movie is pretty entertaining and a good example of sales techniques, it's really unfortunate that the person on the other end of the call, "John," probably ended up losing all of his money and never got any of it back. It's important to keep in mind that investing always involves some level of risk, and it's crucial to thoroughly research any opportunities before making a decision. According to the United States Department of Justice, investors were defrauded out of more than $200 million in the penny stock scheme promoted by Jordan Belfort and his associates. In addition to serving time in prison, Belfort was ordered to pay $110.4 million in restitution to victims of the scheme. However, it is unclear how much of that sum has been paid back to date. ## About Jordan Belfort Jordan Belfort was sentenced to 22 months in prison for his role in the penny stock scheme, and he was also ordered to pay $110.4 million in restitution to the victims. He served 22 months in prison, and after his release, he was required to complete 4 years of probation, during which time he was prohibited from working in the securities industry. Additionally, he was required to give 50% of his income to the restitution fund until he had paid back the full amount. Belfort has also become a well-known public speaker and author, sharing his experiences and lessons learned from his time as a stockbroker.