5 ms·

I don't see why the conversation is always work at large company vs. working at a startup. There's a third option: start a "lifestyle" business that can eventua

I don't see why the conversation is always work at large company vs. working at a startup. There's a third option: start a "lifestyle" business that can eventually be semi-passive. I am currently making about $400k / year working about 5 hours / week from a few different "lifestyle" businesses which I've built slowly over the past 5 years. There's no question that joining a startup as an employee is a terrible idea for any competent engineer. By far the best way to make money in startups is to be a founder. In every business I've started, I've always had big exit dreams, but when those fail to materialize, my startups have soft landed into passive "lifestyle" businesses of which I collect 90% of the profit. Mere employees are forced to quit in this situation and are left with nothing - this is why being a founder is so important. Also, never take VC money without a very good reason to do so.

maxxxxx 11y ago
May I ask what kind of businesses you have? I have tried this several times but never got to a point where the money really worked out. I always seem to pick the wrong niches. Or probably my selling sucks.
- freshhawk 11y ago
  You definitely asked the big question ... but don't expect an answer, a lot of the time this is highly valuable information. Often this information is the single largest company asset.
  - maxxxxx 11y ago
    I am not asking about specific details. I am just curious in what areas a small company/single person can make money on that scale.
    - 0xffff2 11y ago
      My dad used to run a few similar passive income businesses. The thing you are asking is exactly the valuable information that isn't going to be publicly shared. At least in my dad's case, the execution of the business plan was trivial, the only difficult part was the marked research to know what product areas were valuable.
jaredandrews 11y ago
Any recommended reading for doing this sort of thing? This is my goal long term, I just haven't discovered what to do it with yet.
- HeyLaughingBoy 11y ago
  Pick a business domain that needs software. Write software it needs. Sell it. There, I just saved you hours of reading :-)
  - jaredandrews 11y ago
    Haha, yea I know that. I guess finding the domain is the tough part >:|
    - Fomite 11y ago
      Helps to know a lot of people who aren't developers, and get them to complain about work.
    - ChuckMcM 11y ago
      Airline Rebooking - this takes them forever Any recurring visit business (Barbers, Nails, Dentist, Optometrists, Dispensaries, Restaurants, ...) customer engagement/tracking/service software Any Job estimating business (painting, construction, masonry, welding ...) Any billable hour business (freelancing, legal, babysitting, ...) Consider walking down {Main|King} Street of your town, walking into each shop, and asking them about software they use and what they like and don't like about it. Attend a meeting of the Rotary or Chamber of Commerce and ask them. The trick is that customer only sees problems and you only see solutions, so no customer will come to you proposing a solution to their problem, and you won't be successful guessing what problems the customer has. You have to go out and see for yourself and try to understand their pain points.
      - jaredandrews 11y ago
        This is great advice, thank you!
mpdehaan2 11y ago
I'm not sure about your businesses, but that sounds super great. (Though even 30 hours a week and a quarter of that is super great if you're happy). But I don't think joining a startup as an employee is terrible - perhaps it's even better - you get to watch some of the wheels in the machine, without being, well, between the cogs :) There are advantages and disadvantages - if the company is young and it acts like it, it can be chaos - but you probably don't have the bureaucracy and maybe it doesn't act like it. I've seen 400 person companies that acted more like 10 person startups and 30 person startups that acted like 400 person companies. It all varies. Join the company who's people, product, and culture make you the most happy, IMHO. The startup isn't a terrible idea as an employee, as long as you aren't doing it for the profit. And you could still do ok, but ... that's not reason to do it. I love the idea of a bootstrapped business, and it's a shame in certain circles that's looked down upon. Getting to a place where you can build the right thing and only grow when you want to grow, and care about employees (if applicable) first and foremost is super fantastic. If you can do this, every time, do this. The VC equation is entirely a profit model and the focus on growth causes all kinds of tradeoffs.
swimorsinka 11y ago
Any advice on how you did this?
- throaway1853 11y ago
  The recipe is very easy actually. Pick a business you think you'd be competitive in, and apply for a low level position at one of your competitors. Customer support, mail room, whatever you can get. If you went to a top university or have an impressive resume, leave that info out of your application, it will only raise red flags. Getting the position will more often than not give you unfettered access to all the competitor's proprietary info including revenue, margins, sourcing, expenses, as well as identify areas where you could improve upon what your competitor is doing or make things more efficient. When you have a good grasp of the business and a roadmap in mind, quit and do it yourself.

maxxxxx 11y ago

May I ask what kind of businesses you have? I have tried this several times but never got to a point where the money really worked out. I always seem to pick the wrong niches. Or probably my selling sucks.

freshhawk 11y ago
You definitely asked the big question ... but don't expect an answer, a lot of the time this is highly valuable information. Often this information is the single largest company asset.
- maxxxxx 11y ago
  I am not asking about specific details. I am just curious in what areas a small company/single person can make money on that scale.
  - 0xffff2 11y ago
    My dad used to run a few similar passive income businesses. The thing you are asking is exactly the valuable information that isn't going to be publicly shared. At least in my dad's case, the execution of the business plan was trivial, the only difficult part was the marked research to know what product areas were valuable.

jaredandrews 11y ago

Any recommended reading for doing this sort of thing? This is my goal long term, I just haven't discovered what to do it with yet.

HeyLaughingBoy 11y ago
Pick a business domain that needs software. Write software it needs. Sell it. There, I just saved you hours of reading :-)
- jaredandrews 11y ago
  Haha, yea I know that. I guess finding the domain is the tough part >:|
  - Fomite 11y ago
    Helps to know a lot of people who aren't developers, and get them to complain about work.
  - ChuckMcM 11y ago
    Airline Rebooking - this takes them forever Any recurring visit business (Barbers, Nails, Dentist, Optometrists, Dispensaries, Restaurants, ...) customer engagement/tracking/service software Any Job estimating business (painting, construction, masonry, welding ...) Any billable hour business (freelancing, legal, babysitting, ...) Consider walking down {Main|King} Street of your town, walking into each shop, and asking them about software they use and what they like and don't like about it. Attend a meeting of the Rotary or Chamber of Commerce and ask them. The trick is that customer only sees problems and you only see solutions, so no customer will come to you proposing a solution to their problem, and you won't be successful guessing what problems the customer has. You have to go out and see for yourself and try to understand their pain points.
    - jaredandrews 11y ago
      This is great advice, thank you!

mpdehaan2 11y ago

I'm not sure about your businesses, but that sounds super great. (Though even 30 hours a week and a quarter of that is super great if you're happy). But I don't think joining a startup as an employee is terrible - perhaps it's even better - you get to watch some of the wheels in the machine, without being, well, between the cogs :) There are advantages and disadvantages - if the company is young and it acts like it, it can be chaos - but you probably don't have the bureaucracy and maybe it doesn't act like it. I've seen 400 person companies that acted more like 10 person startups and 30 person startups that acted like 400 person companies. It all varies. Join the company who's people, product, and culture make you the most happy, IMHO. The startup isn't a terrible idea as an employee, as long as you aren't doing it for the profit. And you could still do ok, but ... that's not reason to do it. I love the idea of a bootstrapped business, and it's a shame in certain circles that's looked down upon. Getting to a place where you can build the right thing and only grow when you want to grow, and care about employees (if applicable) first and foremost is super fantastic. If you can do this, every time, do this. The VC equation is entirely a profit model and the focus on growth causes all kinds of tradeoffs.

swimorsinka 11y ago

Any advice on how you did this?

throaway1853 11y ago
The recipe is very easy actually. Pick a business you think you'd be competitive in, and apply for a low level position at one of your competitors. Customer support, mail room, whatever you can get. If you went to a top university or have an impressive resume, leave that info out of your application, it will only raise red flags. Getting the position will more often than not give you unfettered access to all the competitor's proprietary info including revenue, margins, sourcing, expenses, as well as identify areas where you could improve upon what your competitor is doing or make things more efficient. When you have a good grasp of the business and a roadmap in mind, quit and do it yourself.