I wonder if this is behind the greater happiness of people with incomes over 75K per year. They actually have enough money to pay for goods and services that save them time.
... but it should be noted that there's a leveling-off as well. Once you're basically living comfortably and have the requisite free time, more money alone doesn't actually make you any happier.
(Too tired to look up the research references, but I'm pretty sure there are some pretty solid findings out there on e.g. lottery winners, wealthy people, etc.)
You have to distinguish between happiness as emotional well-being (i.e., do you have more happy or sad moments on an average day), vs happiness as life satisfaction (i.e., how happy are you with how your life is going in general).
There's some evidence that the former measure plateaus at some income level, but there's also significant evidence that the latter doesn't: http://www.pnas.org/content/107/38/16489.full
This is not really true. It's just an artifact of the way happiness research is done. There's no cap on income, but typically happiness is rated from 1-10. Thus you see a "leveling off". If you use a log scale you actually see a continuous increase.
> ... but it should be noted that there's a leveling-off as well.
This is not really true. It's a bit of a logish function though.
Lottery winners are very happy, but not 10 times someone on $100,000. Just a reasonably bit more.
I think one does have to be careful of negatives to get the money though, an extra $10,000 for a 2 hour per day commute I think would not pay off. You can't hack the system and rely just on money for happiness.
$75k is approximately where money starts to have substantially diminishing marginal value. (Then add overhead when you consider that most people forget to plan for retirement and emergencies)
> They actually have enough money to pay for goods and services that save them time.
I think you are missing the point. There isn't a magical device the upper classes buy that saves then time (maybe this is the case for poorer people, e.g. having a washing machine is quicker than washing clothes by hand), but once you earn so much, get comfortable and achieve your own level of success, you start to value things other than money.
I assume the $75k refers to somewhere where you can afford the mortgage on a nice house, a car or two, eating out a few times a week, and saving for your children's college fund, etc (i.e. all the material things society says we need). Once you are able to afford all that maybe you start to value the time you spend with your children, so spending an extra hour communiting to get $10k more isn't worth it.
An additional point is that more money allows you to take more risk. At some income, when you buy a commuting car, you'll want something that can get you to work. You don't need to worry as much about how dependable the manufacturer/model is, because you have the resources to take it to a mechanic as soon as problems appear. You could just buy it with the help of regular advertising (mpg, features, etc) instead of doing further research into common issues with $MODEL (whether not doing this is responsible or not... that's another issue). Whereas someone with a much lower income might be scouring craigslist and forums for hours each night trying to find a beater to replace their car that's experiencing death by a thousand cuts.
It's not about being a device per se that provides most of the time saving. There are some devices sure, but the biggest time savings come from services.
As you increase your income you can buy services such as landscaping, housekeeping, painters, etc.
With goods, the biggest time savings can come from not having to shop around for the best value. It's not uncommon to have to shop between multiple grocery stores to get the most for your dollar.
I wonder where this puts founders. We sacrifice a lot of time and money (missed vacations, family time as well as salaries) in the attempt to create something we can call our own. I always debate if it worth it, but there just this excitement associated with the unknown potential of what you are doing that keeps me going...and happy. Sometimes though I do wish I could take that family vacation, or purchase my own apartment.
I believe in the afterlife and for that reason, I don't take my own advice. I do what is virtuous, not what is always enjoyable. However, for someone like the OP, it sounds like they don't care too much for philosophy or religion since they're pulling their recommendations from scientific studies, so I offered them something that might help with their general psychological health. Hopefully one day they'll seek something deeper and not ask existential questions to computer nerds.
I am someone who really doesn’t like vacations. I don’t like travel, I don’t like hotels, and I don’t like eating in restaurants all the time.
What I do like is living for an extended period of time in a new location where I can really get a feel for the place (months not days). I go years without a vacation then move somewhere for 6 months or longer.
I've lead a similar life to the OP so can probably answer this one.
In the last 10 years, I've lived and worked Switzerland for 6 months, in the south of France for 9 months (contracting), in Scotland for a year, Canada for 10 months, New Zealand for 2 years, Australia on several occasions for a year or so at a time. I'm currently back in Australia now.
In between those, I've lived back in the England, my home country.
I've both been following work and picking places to live. I've done a little bit of remote work while I've been overseas but mainly working for various companies who have sponsored me for a visa to work.
You're right in that moving is stressful but more than stressful, it's a real pain. As I've tended to live somewhere for longer than 6 months, I've lived in a place long enough to get settled to some degree and as a result, acquired "stuff" - living stuff such as small items of furniture, quilts, pillows, kitchen utensils, some consumer electronics (I've got an iMac and a laptop now) and so on. Stuff you need if you're not living out of a hotel for 6 months. That has been the biggest cause of stress and pain. If you can do without stuff, and I'd suggest if you live somewhere longer than 6 months you probably can't and unintentionally you'll start acquiring it anyway, then it would be far easier. If you can live out of a suitcase and laptop bag for 6 - 12 months, then seeing the world is a much easier prospect.
I've never intentionally moved to new places, it's just how things have worked out but this time is the last time! And I've said that before but this time I mean it! (And I've said that before too).
I would certainly recommend travel and working overseas - the experiences you get on both a personal and work level are invaluable. Do I feel like I have a home when I've moved to a new place? I would say I do but an outsider might suggest otherwise when they look at my living spaces that have a tendency to look unpacked! But this time.. this time, I'm staying.
I can relate to accumulating "stuff"... when I move to the town I'm currently living in, one of my goals was to not acquire anything new that I didn't need. Two years later and just thinking about moving makes me dizzy because I have so many things, most of which are pretty frivolous and I would just donate/throw out when I move. Frivolous, but I'm going to miss it all anyway...
I remember reading an article that said a good way to deal with the anxiety of throwing stuff away is to take photos of it. Because generally, you know you're not going to miss it in any practical sense, you're just going to miss having it, and in that sense a photo is almost as good.
I used to be an academic so I would go on sabbatical. I now work for myself so can basically live where I like (or more importantly where ever my wife wants to live). This is one of the nice perks of being the boss of a business with a small team that is all remote.
I would not like to move every 6 months either. I basically go years without a break, then move somewhere for a while. The last place I lived for 6 months was NYC - a totally different lifestyle to Australia and one we really enjoyed.
Vacation doesn't have to mean travel. It can just mean taking time off to relax, read, play, pursue hobbies, and spend time with your family and friends.
All that stuff that most of us would be doing if we didn't have to work for a living.
People say that and it seems true to some extent, but financially, people rarely fall into the categories of "limitless wealth" and "not a penny to my name." It's almost like a false dichotomy is being implied by this statement, claiming that if you don't prioritize money, you will be left penniless and ruined. That simply isn't true. There are a wide range of conditions between wealth and poverty and studies like this show that you do not need to be closer to rich than poor to be happy.
I think it's more the opposite: that the richer you are the more you can afford to prioritize time. This study doesn't even try to control for that; they measure materiality and a measure of subjective feelings of wealth, but they never measure e.g. parental income.
I think studies have shown that past a relatively low (by SV standards) level of income ($75kish I think) the relationship between money and happiness breaks down.
The argument can definitely be made that the happiness difference between "comfortable and independent" and "Zuckerberg" is not all that great.
> I think studies have shown that past a relatively low (by SV standards) level of income ($75kish I think) the relationship between money and happiness breaks down.
This is true. But while that is low by SV standards, the $75k threshold from the study is targeted to "median america" cost of living.
If you adjust for cost of living and for purchasing power over the 6 years since the study was conducted, you end up with quite a bit more for areas like San Francisco. In fact, you'd probably be looking at more like 175-185k. [1]
That's not intuitive for me. I personally think my threshold would rather be "comfortable and independent without having to work".
Not that I don't want to work anymore, but being able to leave my programming job and becoming a dog breeder would make a lot of difference. And take month longs vacations to travel whenever I wanted.
Isn't that too cut and dry? I think what research like this is trying to determine is at what point additional money does not equate to an equal increase in happiness. If you're homeless, then yes, money becomes a huge factor in your life, because it becomes about survival. But what about the middle-class, the people who have the choice to either worry about gaining extra money for material purposes, or choose to be satisfied with a less audacious lifestyle but live more in the moment.
> Resource Orientation Measure (ROM)
Across all studies, we assessed whether individuals
prioritized having more time
or having more money by presenting them with a bina
ry choice. To help participants
imagine these trade-offs concretely and to encourag
e honest responding (Fisher, 1993),
we asked participants to read a short paragraph des
cribing two individuals who prioritize
money or who prioritize time in their daily lives.
The identities of the characters and the
pronouns used in the vignettes were matched to the
participant’s gender (Tina/Tom and
Maggie/Michael); for participants who did not repor
t identifying as either male or female,
the names and pronouns used in the vignettes were d
isplayed as gender neutral
(Madison/Taylor). The choices were presented as fol
lows:
Tina
values her
time
more than her money. She is willing to sacrifice h
er money
to have more time. For example, Tina would rather w
ork fewer hours and make
less money, than work more hours and make more mone
y.
Maggie
values her
money
more than her time. She is willing to sacrifice he
r time
to have more money. For example, Maggie would rathe
r work more hours and
make more money, than work fewer hours and have mor
e time.
We chose a binary response format for pragmatic and
theoretical reasons.
Practically, there is an increased awareness about
the importance of conducting research
with large representative samples (Open Science Col
laboration, 2015). Thus, it is
necessary to design short measures that minimize pa
rticipant burden while maximizing
reliability (Nagy, 2002). Conceptually, we chose th
is response format because we were interested in assessing people’s broad preferences
related to prioritizing time over money,
as opposed to assessing people’s domain-specific pr
eferences.
A perhaps laudable measure in order to increase study coherence, but it definitely limits the usefulness of this study in terms of making nuanced life choices.
Study 1: "Students participated in exchange for the chance to win one of three prizes valued at $700."
Study 2a: "Two hundred and sixty UBC students participated in exchange for entry into a lottery or for course credit (78% female)"
Study 2b: "In Study 2b, 518 adults were recruited from a science museum in Vancouver, Canada"
Study 3a: "In Study 3a, 242 UBC students participated in exchange for course credit or candy (74% female)"
Study 3b: " we were able to recruit a very large sample of UBC students, who participated for course credit (N=2303; 76% female).
Study 4: " we recruited our sample through the GfK Knowledge Networks Survey Panel. Panel members respond to an average of two online surveys per month and receive small cash rewards and prizes for survey completion"
This is very common across most psychology studies from what I understand.
> In the Journal of Personality and Social Psychology, the premier journal in social psychology – the subdiscipline of psychology that should (arguably) be the most attentive to questions about the subjects’ backgrounds – 67% of the American samples (and 80% of the samples from other countries) were composed solely of undergraduates in psychology courses (Arnett 2008). In other words, a randomly selected American undergraduate is more than 4,000 times more likely to be a research participant than is a randomly selected person from outside of the West.
I agree with the unrepresentative part, but absolute sample size numbers don't tell you anything. For some experiments, N=100 is more than enough, and for others N=10000 isn't even close. Did you look at the p-values or any other confidence measurements?
I'm not sure what you mean by 'statistically' above.
In general you can't say whether a sample size of 2000 will get you within a specific margin of error without additional information. It very much depends e.g. on what the hypothesis you're testing is or what you're trying to estimate.
Actually, compared to most studies I'm used to, this is a commendably high sample size. 2a and 3a have N=~250. 2b is 518, and 3b is over 2000. When was the last time you saw a psychological study with sample sizes this big?
Aside from just size though the major problem is the gender disparity of ~80% women in most of the studies. I didn't see mention of ethnicity but I imagine it's overwhelmingly white.
Yeah. This is a big problem, because your average psychology student is a very particular kind of person - young, middle class woman that is bad at maths and simply wants to get a degree from something.
Before I get called out as -ist, let me explain. Psychology is one of the few "default" subjects - i.e. something you pick when you don't know what do you want to major in. It's also a stereotypical feminine subject, hence huge gender gap. The other popular "default" choice is economics, which tend to draw those proficient at maths.
The point being, psychology students are a very particular subset of the population, and thus it's difficult to generalize results from them to everyone.
I noticed this a lot when reading through studies on visual working memory for a paper. In one, the participants were the two lead authors and the grad students in their lab.
Yes, and that's not always a problem. I remember this issue was addressed in my 'methodology' classes where it was explained that a lot of research has been done to figure out in which ways student/non-student participants differ.
Are people’s general orientations to prioritize time over money are associated with greater happiness?
Would you choose a higher paying career that demands longer hours versus making less money and having more free time?
From the downloaded text/pdf of the article:
"thinking about money leads people to value productivity and independence, thinking about time leads people to prioritize social connections"
I've shunned founding startups or working at startups for the last ~3 years, and instead worked 15-20 hr/wk usually remotely.
Time is your greatest asset, personally and professionally. It's how you stay abreast of the great opportunities of our time. You need that freedom to explore things that pique your interest or move you. Founding a startup means becoming mostly blind to the other great opportunities, which is why I'm so reluctant to do a startup, unless I think it's "the one."
IMO, the opportunity cost of startup jobs is far more sinister than you think. Only do it if you need the money or if you believe you're changing the world in the greatest way you can.
It takes way too long for the average startup to be successful, and the overwhelming majority of them aren't successful enough to provide the economic freedom you are referring to.
If you can love the chase of a startup, and love the thrill and long hours, great!
If you are doing it so you can have "more free time later" there are many many better strategies.
Here's one: Get a high-paying software job in a high COL area, work for a decade or so while minimizing your expenses (live cheaply/with friends) and investing as much as possible in a diversified stock market portfolio.
Then when you're sick of it, move to a cheaper area, get a part-time job and sell 3-4% of your assets every year to make up for the deficit. If you're lucky, the safe withdrawal rate of 3-4% will even be enough (or close) to have the ability to quit working for a living completely. Or perhaps your part-time job can cover all your expenses and you can just keep letting your portfolio grow at the expected long-term rate of 6-7% per year.
Really good advice; this is what I tell everyone who has a high value skill like coding. The actual time frame is probably even shorter than 10 years if you are aggressive about saving.
If you're happy with and able to have children after the 10 years of aggressive saving and investment, this strategy will also give you an extra financial buffer for raising kids. The basic strategy is not incompatible.
But obviously, your total spending will increase, so you either have to earn more after having kids or save up more before having kids. If you want to raise your children in a high cost-of-living area, this will of course be even more pronounced.
There's still a massive risk. What if you put three years of your life into a startup that becomes defunct after all that time?
Then you've lost three years of your life and have to go somewhere else.
Sure, you gain knowledge and experience through that time, but joining another company would still take time to work your way through the ranks there. In that three years, you would've had a great head-start on both professional experience and financial health.
Food for thought. Your statement just assumes the startup will do well and that's not a guarantee. There isn't a guarantee a company you work for will be around forever either, but the likelihood is far greater.
2) even lower probability if you're an opportunist as described (note that smart investors like YC actively avoid them).
3) large minimum years investment required, especially if acquired or acqui-hired, maybe 4-10 years, during which you suffer the opportunity costs I described.
4) just easier to explore and be open to the rare opportunities, while still making decent money, by doing something like consulting at low hours. From this position you can always do a startup if you see something great.
Out of curiosity: do you do contracting / consulting work, or have you found a stable 15-20 hr/wk job? I think the latter sounds excellent, while the former sounds stressful.
1 datapoint: I was doing 15-20hr/wk consulting the past few years and making as much as my FT CTO/COO position now and the stress of constant sourcing definitely was stressful (but the extra hours and lifestyle of commandeering your schedule/location was a third dimension to optimize).
How did you make that much? How often did you have to source contacts and how many did you take at a time, and for how long? I'm trying to do similar and am absorbing any input I can about this.
If I had to guess, he probably billed by the hour at a certain rate and estimated timeframe but got the work done orders of magnitude faster so his effective per hour rate is orders of magnitude higher.
E.g I tell you I am $50 an hour and the task will reasonably take 10 hours. However what you don't know is that I am extremely skilled at the task and have done it many times before so I can get it done faster than anyone else. I have frameworks already set up, and a lot of boiler plate infra from previous projects. So I get it done in 1hr. I am now effectively making $500 an hour.
That's pretty dishonest. I would never charge like that. I would rather be completely upfront with a client and charge them $500 per hour for 1 hour, if I know that I can get it done that fast, and it's really providing that much value.
It seems like the gap between your two ways of thinking mostly stems from how silly "hours worked" is as a measure of work done. You're of course right to be skeptical of being dishonest about the number of hours worked, but he has a point as well: it makes no sense to get paid less for a job simply because you're more productive (and make no mistake, most clients would lower the total price of the same task based on your ability to complete it in fewer hours).
The way people typically do it is charge by value of project -- "this component is worth X dollars". Businesses want to solve problems costing D-dollars in T-time for themselves.
They couldn't care less if you spent 1 vs 10 hours on it if they can't do it themselves, so why bother oversharing your time expenditure?
I'm a machine learning specialist tackling interesting/complex problems of a certain worth. There is definitely an "applying the ML hammer to every single nail/problem" thing going as well.
Example: say a company with 1B in revenue and 500M in costs: being able to give them 10% efficiency or 5% increase in revenue through optimization is a 50M value prop to them. So to spend 5M to achieve those extra $s is entirely worth it.
Of course doing things that result in that optimization are nontrivial as well, but that's what people pay me for. :)
The 15-20hrs a week thing is often a client constraint, because I'd ask for data and what not and would have to wait for them to provide me with what I ask for, or that their data has issues and I need to understand how to sanitize it.
I have stable clients. I've only had 2 main ones over the last 3 years. I think there are maybe some misconceptions about what a consulting life must be like. I agree it does sound stressful if it were my long term goal, but it is not, it's primarily a type of life that keeps me as open as possible to finding something truly worth pursuing (IMO at least), which may or may not take the form of a startup. I have my candidates here, which change as I learn.
Same here. I've gone for long periods working primarily for one or two clients, and 1) I made more working part-time than the employees did full-time, 2) I got all the 'fun' new projects while the employees spent a lot of their time doing maintenance and bug-fixing (which they only asked me to do occasionally once I was a 'trusted' contractor), 3) I could go on vacations pretty much whenever I wanted.
There are plenty of downsides, of course, but it's a far cry from the initial fear I had of a life of constantly hunting for clients and constantly playing the 'is my client an asshole / will my client pay / is my client a micro-manager'-roulette.
Finances (billing, quarterly taxes, yearly taxes), lack of colleagues (I feel at best a semi-colleague if I'm somewhere long enough), lots of costs, some hidden or vague (insurances, office space, travel, laptop, utilities, etc.), possible dry spells / less job security (not an issue yet, but still), no perks (paid learning, conferences, outings), proposals and discussions about how much things cost, even with longer-term clients.
And of course the fact that I can't rely on the more 'default' paths of promotions, specializing, etc. I have to choose to grow, or I just keep doing the same thing or risk falling behind.
I don't find all these downsides. For example, I'm rather happy to not have to be around the same group of people day in, day out. Or to feel forced to go to some work event and be a 'team player'. But still. Sometimes I think I miss it, at least.
Thanks. I'm not sure it is as much misconception as it is wild variation in what the consulting life is like for different people. Not everyone has those one or two stable long term clients. In many ways, the wide array of different possibilities in the consulting world is both its blessing and its curse.
Weird stance. Startups are not really about money. They are about greater risk.
For a startup founder it is not unusual to spend a lot of time, and still make zero money. And it is also possible to spend only couple of years, and make so much money that you can leisurely work for couple of days a month, and go surfing for the rest of the month. And do that same thing for the rest of your life.
As an employee you will surely make some money always, and only spend certain amount of time. As a freelancer/contractor typically your risk is a bit greater (you might not get good gigs or something), but as a reward you can earn more money for less time.
So it is not about whether you value your time or money. It is about your risk appetite. It is not that uncommon to do this kind of "lifestyle business" thingie where the primary goal is freedom and time, not necessarily money.
>So it is not about whether you value your time or money. It is about your risk appetite. It is not that uncommon to do this kind of "lifestyle business" thingie where the primary goal is freedom and time, not necessarily money.
Why the condescending tone for those businesses?
The main motivation behind startup is making loads of money. Similar to casino players, hoping to the big payoff. There's more risk of course, but that's not the motivation -- else startup founders would be as likely to be daredevils like Evel Knievel.
Startups don't care much about the actual business aspects (actually making money from what they do) as much as getting VCs to pour money in and then exit.
OTOH, the motivation between lifestyle business is not just freedom and time, but also the product. A custom motorcycle shop or some company making a software tool like BBEdit, for example, with extremely passionate people putting tons of hours into what they do, are "lifestyle businesses". Where in a "startup proper" a founder can be just as happy to sell their to some giant company that while close their main product (acquihires and tech acquisitions).
If I'm not mistaken parent is talking about 'working for a startup' that IMHO isn't as risky as 'co-founding' the startup, which of-course has its whistle bells. Why would a 10th employee join a startup for the risk and not for the money ?
> which is why I'm so reluctant to do a startup, unless I think it's "the one."
IYO indeed. That you have found your way of doing things is wonderful and also incredibly lucky. That you consider opportunity cost a universally objective measure is complete fantasy though.
TL;DR: Always be highly skeptical of anyone claiming their way of life is the right way to live.
Being able to work remotely and at 20-40 hours a week would change my life - seriously. I know there is lots of information around on becoming a freelancer, but do you have any particular insights?
Getting to 40 hours/week is trivial (or rather, the difficulty is all on the emotional side) - you walk out the door after 8 hours every day, and you do it consistently.
Getting down to 20 is much harder, as is getting remote work - all I can suggest for that is being upfront about it, and only working in positions/contracts that are explicitly remote-first.
From where I stand, it looks like you have your numbers backward. The reason you start a startup is so that you can work those 15-20 hour weeks (or less) without anybody giving you grief about it.
Shipping software works just fine on a few hours a weeks. Maybe a quick burst up front to get v1 out the door, but then you can ramp it down as far as you want to go. I've gone entire months without opening the IDE for some of my paying products.
The problem with client work is that as soon as you stop working, the client stops sending you money. SaaS doesn't work that way. Take advantage of that!
Most would refer to what you describe as 'lifestyle business'. I mean 'startup' as the type of startup you would see come out of YC. You work really hard, all the time. Company culture is encompassing, which means employees sacrificing a lot of time and mindshare. As a founder it becomes the only thing you think about, for years. That's startups of the YC vein, and they only want to fund startups that work this way. (Take a look at Sam's 'How to Start a Startup' course if this doesn't ring familiar).
Indeed. That's the definition on paper, but it's your business so you get to run it how you like. There is surprisingly little correlation between hours worked and end result.
I could have easily worked four years of 80 hour weeks, ruined all my relationships and given myself health issues building the product that pays my bills today. I can't imagine the monthly recurring revenue numbers would reflect that effort. It really is more calendar time and marketing that moves the needle. You can do that and still have plenty of time for product development working 10 hours a week.
You can make up quaint terms for it, but really all that does is flag it in your mind as something that's not for you. You really need to be doing that 80 hour week boiler room thing, else you're not startupping enough. So you do, and you're unhappy.
The end goal is to replace your salary by building a product. Call it a lifestyle business if you like. But be sure to do it.
I've tried and failed many times to come up with some kind of small SaaS app that I can just keep running in the background. All of my ideas seem to be just too niche, like solving some tiny problem that no-one would care to pay for. Mainly a lot of different integrations and synchronization between various services. And then I tried my hand at blogs with advertising, or Amazon affiliate sites that went nowhere. And monetized Youtube channels.
Do you have any advice about coming up with ideas for real products, that solve real problems for paying customers? I guess another issue is that the market is getting more and more saturated with mobile and web apps now. It seems like you have to be very lucky to stumble on the gold ideas: where it's very easy to build, and people really want to pay for it.
Or maybe I'm aiming too low, trying to find some minimal weekend app or website. What would be an average amount of effort that you need to put into your projects before you start seeing a return? Or do you crank out a whole bunch of app ideas until you find one that sticks?
That's almost exactly what's happened to me, 3 or 4 times now. I come up with an interesting idea, build it, post it on Reddit and Hacker News. It gets maybe 20,000 views, then traffic slows down, then I just end up paying a lot of money to keep it running. And it's usually something basic that's very tough to monetize.
Naturally, then you need to do all the traditional market validation steps, but this at least filters your ideas down to ones that maybe stand a chance.
I don't have any direct answers, but the more ideas you execute on, the better chance something 'sticks', and the best thing you can do is make it as simple and as painless as possible to launch prototypes. Each time you do a project, take time to abstract the code into reusable components, templates, etc. and integrate it into a generator infrastructure with nodes that represent different 'types' of apps. Then when another idea comes to you, go to your generator node that is most similar, and spin something up with most of your codebase there, front end and back, incl. a stylish landing page. This is a serious time investment to get going, but if you're serious about launching an online business that 'sticks', you're most likely going to need to try out a lot of things.
As far as getting good ideas, I think they almost always have to come to you organically because you have a fascination or interest in the area, or you experience an obstacle somewhere, or you have a need for it personally. PG (or maybe it was Sam) spoke about getting into the right mindset for idea generation in the Stanford startup course, and the gist of it was 'go travel'... i.e. by default be in a 15-20 hr/ wk (max) work setup so you have time to explore things as they pique your interest.
I'm not sure if a lifestyle business is seen as a degrading term when hurled at someone. The only people it's a lifestyle business for is people who already have the lifestyle of not necessarily having to work - investors.
What we have left is a term that's used to whack people who could add value in a lot of way to only think they can do it if a VC gives them their blessing of worth, validation and permission to innovate. I don't think that's accurate or fair to anyone.
For entrepreneurs, there is no lifestyle business, or owning a business until it can run without you.
There are plenty of SaaS businesses in the $1M to 5M/yr range that would be perfectly suitable "failures". To me, it doesn't seem unprudent prudent to collect a few of these "lifestyle failures" and be ready to build the $100M company instead of taking moonshots without any experience in building a business.
I searched for the phrase "diminishing marginal returns" but could not find it in the article which seems like a bit of an omission.
This is a fundamental economic concept - the more of something you have, the less value you derive from each incremental unit.
So, based on personal preferences, once you reach a certain level of income you will start to substitute away from labor (income) towards leisure/free time (non-market activities such as hobbies, cooking, parenting, gaming, chilling).
The study data shows this pretty clearly (if I'm reading it correctly) - in Study 2b (wealthy people polled at a science museum) the median household income was $100-149k and the "% Time Oriented" was 69%. In Study 4 (online panel members who get free internet in exchange for survey participation) the median household income was $75-85k and the "% Time Oriented" was 46%.
The implied result that upper middle class folk are able to spend more time on leisure and are therefore happier on average than regular middle class folk doesn't seem too groundbreaking.
I came to a different conclusion. The wealth of time (total man-hours or aggregated lifespans) is more evenly distributed across a population than is the wealth of money. Therefore, to the extent that happiness is influenced by comparing how well-off you are vs others, a person picked at random will be pretty damn close to the same standing as whoever is the Time-Richest Person in the World. But they are FAR less likely to be anywhere near the Money-Richest Person in the World.
I think it's even more dramatic than that. Wealth conveys the ability to explore alternate experiences with more efficiency.
What I mean by that is the ability to either fund "vicarious" experiences. ("If I worked on this project, I'd do about the same thing as that person, so I'll hire them to do it.") As well as the more conventional kinds of acceleration like finding it easier to more frequently have more peak and different experiences like travel.
Well, when you're running a company or are an executive, obviously you will be time-poor and money-rich. But in general, having more assets means you'll have more free time. And arguably, the time a company owner spends may be be being spent exactly how they want to spend it, in which case they aren't time-poor at all.
It isn't at all groundbreaking, but we haven't figured out how to apply the concept to society very well. Bertrand Russell's 1932 essay on the topic has been discussed here before: https://news.ycombinator.com/item?id=6513765
What we need is an inversion of the "diminishing marginal returns" concept to permeate economic theory. Maybe some people just call that Keynesian theory?
I think the real takeaway isn't about upper middle class versus regular middle class. Rather there is quite a lot of negative value / lost opportunities by drawing the poverty line so low.
I think you meant "diminishing marginal utility". The law of diminishing marginal returns concerns employees not goods consumed.
Though not specifically relevant to your post, this "law" doesn't always hold. Some goods have a utility threshold that must be crossed before they become valuable or increase in utility (e.g., various medicines and antibiotics). Money operates similarly, i.e., its utility does not necessarily diminish, much less in monotonic fashion. Assume that if I make N dollars, I may be able to afford popcorn or I may be able to afford butter, but not both. Let's also assume that I derive little satisfaction from popcorn or butter alone. However, if I make N+1 dollars, I can afford both popcorn and butter from which I derive a great deal of satisfaction. The addition $1 has greater utility than the Nth dollar I had previously.
That is extremely flawed logic. You picked an arbitrary example to make your point, but your point requires excluding other possible uses of the Nth dollar to make any sense.
"Oh, with 15k I could buy a compact car that I wouldn't like much, but with 30k I could buy an entry level sports car that I would enjoy a lot. So the second 15k has greater utility than the first 15k."
Does this make sense? Of course not. The first 15k can buy you reliable transportation which is more valuable than the fun from a sports car. 15k can also pay for a year of housing and food in many places, which has way greater utility than the ability to drive like a jackass on the highway.
With your N dollars, you might not enjoy the popcorn without butter, but you could also buy something else to eat, or some fuel, or any number of other things that have more utility than butter on your popcorn.
Every dollar adds additional things that you could purchase. But each dollar comes with declining utility. First you get necessities, then wants, then luxuries. If you have insufficient dollars to buy popcorn with butter, you probably need to spend your money on something now useful than popcorn anyway. Popcorn is a want and you probably haven't met your necessities.
You could just as well say that the cent that buys you a soda has a bigger marginal utility than the previous one. Sure, maybe in the context of that one transaction, but not in any general way.
Even in a (totally unrealistic) scenario where N dollars are "useless" to you, but N+1 get you something of great value, it's not true that the (N+1)th dollar has greater marginal utility than any of the other N dollars, because you need all those other dollars to buy the thing. In other words, the previous N dollars weren't actually useless: they enabled you to obtain the (N+1)th dollar. Without them, that (N+1)th dollar is just your first dollar.
Sometimes there's a psychological difference though. Say you have $8 in your pocket, and there's a movie you like to see in the cinema nearby. The ticket costs $10. You know you won't get that $2 in a reasonable timeframe - maybe it's your only evening off, so even if you get some more cash tomorrow you won't have a chance to see the movie. Maybe you also don't feel like begging strangers for change. In this situation, you may find yourself wishing for those $2 very much, and after realizing you can't get them, you'll say "fuck it, I may as well spend my $8 on some pizza or beer" and then do so.
Maybe that last $2 don't have greater marginal value than the $8 in your pocket, but that $8 loses its perceived value the moment you realize you won't get additional $2 in time.
It's not a hypothetical situation, by the way. I've been in those several times in the past, and followed exactly the same pattern of emotional reasoning.
Probably OT, but all things being equal the person that saves the $8 until next week's night off will probably end up in a better place in life than the person that gets a slice of pizza and a beer.
That's why I refuse to do a single minute of overtime even if it is paid. I've told employers to fire me if they feel like I should be staying longer and none of them have yet. If I ever need to make up time or do extra work, it's usually because of mismanagement and crappy deadlines as 8 hours of solid work a day is a lot, nothing should be "late".
Free time is absolutely the most valuable currency. If you can practice an instigative hobby and augment that hobby with the good money you make, then you've got it made. I have a bloody ton of hobbies and I can't wait to get out of work to work on my own stuff.
Seeing my days/life in two parts as stability (day job) being fuel for my hobby has helped me deal with my identity crisis when I got completely turned off from coding. It was also my hobby so I was always coding, but once I lost that I didn't know what to do and I hated my job. Once I saw it as fuel, no matter what day job I have, is now in context of a hobby.
Something where you create tangible value. Video games, movies, collecting, etc are all consumer hobbies. Leather making, coding, music, knitting, etc, are instigative. The main difference is it's difficult to relate to other people about consumer hobbies unless you consume the same things. With instigative hobbies you can teach people and talk about them to others who know nothing about it. I'm not saying either is better than the other, it's just harder to relate to people when all you do is consume.
I take it that you coined this term all by yourself? This is the only use of "instigative hobby" that google knows about. I think you need a better adjective than instigative. Nothing about instigative makes me think the distinction is between the consumption/creation of goods. I don't agree with your conclusion but at the very least "creative hobby" seems like the obvious choice. I am not sure why I can more easily teach and talk about woodworking to someone than I could if the subject was video games or wine. This certainly does not match up with my experience with my hobby of book consumption or the experiences of my friend who is a wine sommelier. But most importantly I am not sure why I would prefer the creation of relationships where the dynamic is based on a knowledge asymmetry in my favor.
>This certainly does not match up with my experience with my hobby of book consumption or the experiences of my friend who is a wine sommelier
I could not think of someone I'd get along with less. You must be much older than me. This is exactly what I'm talking about. I'd never want to listen to someone tell me about the history of something, that's boring, that's regurgitation, I can google that. If you've made wine before though, that's definitely interesting.
I kind of agree about the wine sommelier, I don't want to go into that much detail about the history of wines. The movie "Somm" was enough for me. But I do like history, especially if it's directly related to the person I'm talking to, or the place I'm in.
And I'm in Phnom Penh now, having done the tour of the Killing Fields and S-21 prison. Learning about Khmer Rouge, Pol Pot, and even refreshing my memory about communism, the Soviet Union, Joseph Stalin, etc. I'm finding it all very interesting now.
But also I agree with the commenter above you, "creative hobbies" would make more sense than "instigative".
If you look at table 3, which is a study of the museum going group, you can actually see that SWB (subjective well being) is mostly correlated with household income and material affluence. However in table 3a, we can see that SWB is negatively correlated with material striving.
In other words, people who are concentrated on making money are the people who don't have money and are also unhappy.
People who value time are the people who already have money and don't have to worry about it.
The conclusion I would make from this is that the more money, and implicitly more time freedom you have, the happier you are. If you are trying to make money but don't have any, you're not happy.
> Mr Micawber's famous, and oft-quoted, recipe for happiness:
>
> "Annual income twenty pounds, annual expenditure nineteen [pounds] nineteen [shillings] and six [pence], result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."
One perfectly plausible explanation is that people who already have plenty of money tend to value time over having a little bit more money. And people who already have plenty of money are happier than people who are a bit short on money.
We live an average 70-80 years on a lucky rocky, watery ball among bazillions gaseous, frozen or rocky balls into a dark void somewhat existing since a dozen billion years. Money is nothing vs living our time happily or peacefully at least.
I'm struggling to see the connection here. You can love someone and still be unhappy. Abuse victims often love their abusers. Suicide victims often have loved ones.
It's not happiness. It's being trapped between two emotions - the joy of having and caring for kids, and the despair caused by constant drudgery without perspective. Some people manage to focus so hard on the former that they forget about the latter, at least for a moment. But others can't.
That argument is kind of like how in asset forfeiture cases they don't charge a person with the crime, they charge the person's bag of hundred dollar bills with a crime.
I don't quite understand how "valuing time over money" is meaningful. Time and money have an exchange rate. If you want more time, you can generally forego additional money to get it, and vice versa.
Perhaps it should have stated that being happier correlates with valuing an additional minute of leisure time at a higher amount of money.
And that is as much as saying that people paid more for their work are happier, which seems almost tautological.
Very close to my reaction. Having whichever you value is a big factor in happiness. Rich people have money and crave time. The unemployed have time and crave money. No surprise which of those is happier. The more interesting cases are people who don't have a lot of either but give up time for money (most of us) or give up money for time (ski bums, monks, bohemians of many kinds). Which we pursue is a strong statement about which we value, and - again - those who pursue time seem happier overall.
Personally, I've been much happier since I dropped to part time, giving up (some) money for (some) time. I'll be even happier when I take that next step toward full retirement.
How did you make the decision to go part time instead of full time? Did you have a sizable amount of cash saved up before choosing to do so, or did you do the math, figure "I only need $X to live each month so I'll only work enough hours to make that"? If that's the case, how are you saving money for retirement? Or do you just want to live out your retirement as a ski bum, or a monk?
Things have changed only a bit since then. A couple of years' worth of still-increasing income have brought me even closer to permanent financial security. I'm still pretty unimpressed by where this industry is headed technically, socially, and financially. I still want to finish one more Big Thing for pay, maybe one more on my own, and then just dabble in whichever smaller projects catch my fancy. I know, based on the responses to that blog post, that I'm far from alone. I suspect that many people reading this will eventually end up in the same place, whether they believe it now or not.
Thanks for sharing, that was a nice read. Burning out on not just projects but with code is something that resonates with me and I'm only two years into my career! It's very kind of Red Hat to give you time off and let you switch to part time.
I'm young blood, so I have hope for where the industry is headed technically and financially (not so sure about socially...). Then again, I don't really have a choice but to have hope otherwise my future doesn't look too bright :)
Happiness is that for which a trap cannot be laid...
Time is more valuable for some--book lovers, hobbyists,daydreamers, etc...
Money is more valuable for others...earning it, the implied security of holding it, etc...
It seems to me, based on experience, that the route to general happiness is to eliminate as many things as possible that past experience has led you to believe won't make you happy...
A life spent in contentment, interspersed with moments of joy (or, happiness) is likely all that humans can resonably hope for...
You can't "value time over money" per se. That's like saying "value dollars over pounds". There's just a (not-necessarily-linear) marginal exchange rate between the two.
I think there's an implied "marginal" before both time and money in that statement.
You have a steady income of time, you can choose to spend some of that on money, but past a certain point of wealth, the money ceases to be the most valuable use of your incoming time.
People might work really hard while they're young so that they can retire early and be happy and secure later. Those people would look like they value money more than their time, and probably aren't going to be very happy right now, but in 30 years they're going to be much happier than people still working full-time.
Depends on what people your talking about. People working wage jobs might retire early if they work really hard and save the extra. Salaried workers really don't make that much more for working themselves to death. Bonuses might be higher, promotions might be a little quicker. Or they might not. Certainly working 80 hours will not result in twice the pay for most salaried employees, not even close. Working more efficiently (and politically) is a better route for most if not all salaried employees.
Or you'll find that all the time you put into your work has left you with little hobbies and few relationships outside of your work. You'll also have been honing only the skills necessary to succeed in the workplace, not be happy in your life. What happens is you retire and then you find you're not really good at anything else, and your body is old and creaky and you just don't have the energy to learn things as much anymore. Or, even worse, if you didn't make quite as good investments as you thought you were or there is a huge market downturn and now you have no skills or resources. It happens to a lot of people.
I have some bums I know that can testify the same: having time and no money sux.
I have written Klines of codes in a lot of language, but writing big brother software that impoverish people even if my boss gives me extra time for my life balance makes me sad.
These studies focus on biased population that don't experience poverty, nor seems to care about the others either by ignorance or by convenience (which is worse).
I am ruined, anxious, not(happy) (which is different from unhappy) ... but I still have the will to be able to help people suffering more than me... and worst of all I cannot even donate my blood, I come from Europa in Canada.
But not being happy does not mean being down. I am superficially unhappy, I will find a way to make things better for both me and people I meet.
Happyness is like rain, boring and cold. But it makes you enjoy the sun.
I am not happy and I am angry. It makes me feel as alive as when I wed with the one I love. Being told that not being happy is negative, is the same as if I was told to cut my balls because dick is so much more important.
Those that value time over money more are clearly likely to be richer (or even just feel richer), so the conclusion seems pretty obvious, unless they controlled for that.
The one thing is that you need to have a critical amount of money before you can sacrifice money for time. Without that critical amount of money, biasing towards either more time and spending more money, or money and spending more time either will probably lead to a lot of unhappiness.
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[ 3.2 ms ] story [ 227 ms ] thread(Too tired to look up the research references, but I'm pretty sure there are some pretty solid findings out there on e.g. lottery winners, wealthy people, etc.)
There's some evidence that the former measure plateaus at some income level, but there's also significant evidence that the latter doesn't: http://www.pnas.org/content/107/38/16489.full
This is not really true. It's a bit of a logish function though.
Lottery winners are very happy, but not 10 times someone on $100,000. Just a reasonably bit more.
I think one does have to be careful of negatives to get the money though, an extra $10,000 for a 2 hour per day commute I think would not pay off. You can't hack the system and rely just on money for happiness.
This seems like an easier topic to study, although still fraught with some of the measurement shortcomings inherent in this one.
I think you are missing the point. There isn't a magical device the upper classes buy that saves then time (maybe this is the case for poorer people, e.g. having a washing machine is quicker than washing clothes by hand), but once you earn so much, get comfortable and achieve your own level of success, you start to value things other than money.
I assume the $75k refers to somewhere where you can afford the mortgage on a nice house, a car or two, eating out a few times a week, and saving for your children's college fund, etc (i.e. all the material things society says we need). Once you are able to afford all that maybe you start to value the time you spend with your children, so spending an extra hour communiting to get $10k more isn't worth it.
As you increase your income you can buy services such as landscaping, housekeeping, painters, etc.
With goods, the biggest time savings can come from not having to shop around for the best value. It's not uncommon to have to shop between multiple grocery stores to get the most for your dollar.
Good Idea: Take a vacation. Enjoy life.
Whatever makes you happy. :)
What I do like is living for an extended period of time in a new location where I can really get a feel for the place (months not days). I go years without a vacation then move somewhere for 6 months or longer.
I would love to do this but find moving to be incredibly stressful, and moving every six months I would feel like I don't have a real "home".
In the last 10 years, I've lived and worked Switzerland for 6 months, in the south of France for 9 months (contracting), in Scotland for a year, Canada for 10 months, New Zealand for 2 years, Australia on several occasions for a year or so at a time. I'm currently back in Australia now.
In between those, I've lived back in the England, my home country.
I've both been following work and picking places to live. I've done a little bit of remote work while I've been overseas but mainly working for various companies who have sponsored me for a visa to work.
You're right in that moving is stressful but more than stressful, it's a real pain. As I've tended to live somewhere for longer than 6 months, I've lived in a place long enough to get settled to some degree and as a result, acquired "stuff" - living stuff such as small items of furniture, quilts, pillows, kitchen utensils, some consumer electronics (I've got an iMac and a laptop now) and so on. Stuff you need if you're not living out of a hotel for 6 months. That has been the biggest cause of stress and pain. If you can do without stuff, and I'd suggest if you live somewhere longer than 6 months you probably can't and unintentionally you'll start acquiring it anyway, then it would be far easier. If you can live out of a suitcase and laptop bag for 6 - 12 months, then seeing the world is a much easier prospect.
I've never intentionally moved to new places, it's just how things have worked out but this time is the last time! And I've said that before but this time I mean it! (And I've said that before too).
I would certainly recommend travel and working overseas - the experiences you get on both a personal and work level are invaluable. Do I feel like I have a home when I've moved to a new place? I would say I do but an outsider might suggest otherwise when they look at my living spaces that have a tendency to look unpacked! But this time.. this time, I'm staying.
I would not like to move every 6 months either. I basically go years without a break, then move somewhere for a while. The last place I lived for 6 months was NYC - a totally different lifestyle to Australia and one we really enjoyed.
All that stuff that most of us would be doing if we didn't have to work for a living.
The argument can definitely be made that the happiness difference between "comfortable and independent" and "Zuckerberg" is not all that great.
This is true. But while that is low by SV standards, the $75k threshold from the study is targeted to "median america" cost of living.
If you adjust for cost of living and for purchasing power over the 6 years since the study was conducted, you end up with quite a bit more for areas like San Francisco. In fact, you'd probably be looking at more like 175-185k. [1]
1. http://www.advisorperspectives.com/dshort/commentaries/Happi...
Not that I don't want to work anymore, but being able to leave my programming job and becoming a dog breeder would make a lot of difference. And take month longs vacations to travel whenever I wanted.
A perhaps laudable measure in order to increase study coherence, but it definitely limits the usefulness of this study in terms of making nuanced life choices.
Study 2a: "Two hundred and sixty UBC students participated in exchange for entry into a lottery or for course credit (78% female)"
Study 2b: "In Study 2b, 518 adults were recruited from a science museum in Vancouver, Canada"
Study 3a: "In Study 3a, 242 UBC students participated in exchange for course credit or candy (74% female)"
Study 3b: " we were able to recruit a very large sample of UBC students, who participated for course credit (N=2303; 76% female).
Study 4: " we recruited our sample through the GfK Knowledge Networks Survey Panel. Panel members respond to an average of two online surveys per month and receive small cash rewards and prizes for survey completion"
Make of it what you will
> In the Journal of Personality and Social Psychology, the premier journal in social psychology – the subdiscipline of psychology that should (arguably) be the most attentive to questions about the subjects’ backgrounds – 67% of the American samples (and 80% of the samples from other countries) were composed solely of undergraduates in psychology courses (Arnett 2008). In other words, a randomly selected American undergraduate is more than 4,000 times more likely to be a research participant than is a randomly selected person from outside of the West.
Source: http://hci.ucsd.edu/102b/readings/WeirdestPeople.pdf
In general you can't say whether a sample size of 2000 will get you within a specific margin of error without additional information. It very much depends e.g. on what the hypothesis you're testing is or what you're trying to estimate.
Before I get called out as -ist, let me explain. Psychology is one of the few "default" subjects - i.e. something you pick when you don't know what do you want to major in. It's also a stereotypical feminine subject, hence huge gender gap. The other popular "default" choice is economics, which tend to draw those proficient at maths.
The point being, psychology students are a very particular subset of the population, and thus it's difficult to generalize results from them to everyone.
Would you choose a higher paying career that demands longer hours versus making less money and having more free time?
From the downloaded text/pdf of the article: "thinking about money leads people to value productivity and independence, thinking about time leads people to prioritize social connections"
It looks like high quality social connections lead to happiness: http://www.ted.com/talks/robert_waldinger_what_makes_a_good_...
Dry read but great paper.
Time is your greatest asset, personally and professionally. It's how you stay abreast of the great opportunities of our time. You need that freedom to explore things that pique your interest or move you. Founding a startup means becoming mostly blind to the other great opportunities, which is why I'm so reluctant to do a startup, unless I think it's "the one."
IMO, the opportunity cost of startup jobs is far more sinister than you think. Only do it if you need the money or if you believe you're changing the world in the greatest way you can.
It takes way too long for the average startup to be successful, and the overwhelming majority of them aren't successful enough to provide the economic freedom you are referring to.
If you can love the chase of a startup, and love the thrill and long hours, great!
If you are doing it so you can have "more free time later" there are many many better strategies.
Then when you're sick of it, move to a cheaper area, get a part-time job and sell 3-4% of your assets every year to make up for the deficit. If you're lucky, the safe withdrawal rate of 3-4% will even be enough (or close) to have the ability to quit working for a living completely. Or perhaps your part-time job can cover all your expenses and you can just keep letting your portfolio grow at the expected long-term rate of 6-7% per year.
Having children is possibly the stupidest thing anyone could ever do (for their happiness or bank account).
But obviously, your total spending will increase, so you either have to earn more after having kids or save up more before having kids. If you want to raise your children in a high cost-of-living area, this will of course be even more pronounced.
Then you've lost three years of your life and have to go somewhere else.
Sure, you gain knowledge and experience through that time, but joining another company would still take time to work your way through the ranks there. In that three years, you would've had a great head-start on both professional experience and financial health.
Food for thought. Your statement just assumes the startup will do well and that's not a guarantee. There isn't a guarantee a company you work for will be around forever either, but the likelihood is far greater.
2) even lower probability if you're an opportunist as described (note that smart investors like YC actively avoid them).
3) large minimum years investment required, especially if acquired or acqui-hired, maybe 4-10 years, during which you suffer the opportunity costs I described.
4) just easier to explore and be open to the rare opportunities, while still making decent money, by doing something like consulting at low hours. From this position you can always do a startup if you see something great.
E.g I tell you I am $50 an hour and the task will reasonably take 10 hours. However what you don't know is that I am extremely skilled at the task and have done it many times before so I can get it done faster than anyone else. I have frameworks already set up, and a lot of boiler plate infra from previous projects. So I get it done in 1hr. I am now effectively making $500 an hour.
They couldn't care less if you spent 1 vs 10 hours on it if they can't do it themselves, so why bother oversharing your time expenditure?
Example: say a company with 1B in revenue and 500M in costs: being able to give them 10% efficiency or 5% increase in revenue through optimization is a 50M value prop to them. So to spend 5M to achieve those extra $s is entirely worth it.
Of course doing things that result in that optimization are nontrivial as well, but that's what people pay me for. :)
The 15-20hrs a week thing is often a client constraint, because I'd ask for data and what not and would have to wait for them to provide me with what I ask for, or that their data has issues and I need to understand how to sanitize it.
There are plenty of downsides, of course, but it's a far cry from the initial fear I had of a life of constantly hunting for clients and constantly playing the 'is my client an asshole / will my client pay / is my client a micro-manager'-roulette.
And of course the fact that I can't rely on the more 'default' paths of promotions, specializing, etc. I have to choose to grow, or I just keep doing the same thing or risk falling behind.
I don't find all these downsides. For example, I'm rather happy to not have to be around the same group of people day in, day out. Or to feel forced to go to some work event and be a 'team player'. But still. Sometimes I think I miss it, at least.
For a startup founder it is not unusual to spend a lot of time, and still make zero money. And it is also possible to spend only couple of years, and make so much money that you can leisurely work for couple of days a month, and go surfing for the rest of the month. And do that same thing for the rest of your life.
As an employee you will surely make some money always, and only spend certain amount of time. As a freelancer/contractor typically your risk is a bit greater (you might not get good gigs or something), but as a reward you can earn more money for less time.
So it is not about whether you value your time or money. It is about your risk appetite. It is not that uncommon to do this kind of "lifestyle business" thingie where the primary goal is freedom and time, not necessarily money.
> Startups are not really about money
I agree,
> Only do it if... you believe you're changing the world in the greatest way you can
They are about pursuing a vision. Even YC has said they dislike opportunists, and for good reasons (they make bad startups).
Why the condescending tone for those businesses?
The main motivation behind startup is making loads of money. Similar to casino players, hoping to the big payoff. There's more risk of course, but that's not the motivation -- else startup founders would be as likely to be daredevils like Evel Knievel.
Startups don't care much about the actual business aspects (actually making money from what they do) as much as getting VCs to pour money in and then exit.
OTOH, the motivation between lifestyle business is not just freedom and time, but also the product. A custom motorcycle shop or some company making a software tool like BBEdit, for example, with extremely passionate people putting tons of hours into what they do, are "lifestyle businesses". Where in a "startup proper" a founder can be just as happy to sell their to some giant company that while close their main product (acquihires and tech acquisitions).
I didn't read his tone as condescending.
> Similar to casino players ... don't care much about the actual business aspects
That's quite the generalization. Is it possible you've over-fit to a few observations?
IYO indeed. That you have found your way of doing things is wonderful and also incredibly lucky. That you consider opportunity cost a universally objective measure is complete fantasy though.
TL;DR: Always be highly skeptical of anyone claiming their way of life is the right way to live.
Getting down to 20 is much harder, as is getting remote work - all I can suggest for that is being upfront about it, and only working in positions/contracts that are explicitly remote-first.
Shipping software works just fine on a few hours a weeks. Maybe a quick burst up front to get v1 out the door, but then you can ramp it down as far as you want to go. I've gone entire months without opening the IDE for some of my paying products.
The problem with client work is that as soon as you stop working, the client stops sending you money. SaaS doesn't work that way. Take advantage of that!
I could have easily worked four years of 80 hour weeks, ruined all my relationships and given myself health issues building the product that pays my bills today. I can't imagine the monthly recurring revenue numbers would reflect that effort. It really is more calendar time and marketing that moves the needle. You can do that and still have plenty of time for product development working 10 hours a week.
You can make up quaint terms for it, but really all that does is flag it in your mind as something that's not for you. You really need to be doing that 80 hour week boiler room thing, else you're not startupping enough. So you do, and you're unhappy.
The end goal is to replace your salary by building a product. Call it a lifestyle business if you like. But be sure to do it.
Do you have any advice about coming up with ideas for real products, that solve real problems for paying customers? I guess another issue is that the market is getting more and more saturated with mobile and web apps now. It seems like you have to be very lucky to stumble on the gold ideas: where it's very easy to build, and people really want to pay for it.
Or maybe I'm aiming too low, trying to find some minimal weekend app or website. What would be an average amount of effort that you need to put into your projects before you start seeing a return? Or do you crank out a whole bunch of app ideas until you find one that sticks?
EDIT: Really big coincidence, I just read the "How I Built a Side Project" post: https://stayintech.com/info/sideproject
That's almost exactly what's happened to me, 3 or 4 times now. I come up with an interesting idea, build it, post it on Reddit and Hacker News. It gets maybe 20,000 views, then traffic slows down, then I just end up paying a lot of money to keep it running. And it's usually something basic that's very tough to monetize.
https://news.ycombinator.com/item?id=9883697
Naturally, then you need to do all the traditional market validation steps, but this at least filters your ideas down to ones that maybe stand a chance.
As far as getting good ideas, I think they almost always have to come to you organically because you have a fascination or interest in the area, or you experience an obstacle somewhere, or you have a need for it personally. PG (or maybe it was Sam) spoke about getting into the right mindset for idea generation in the Stanford startup course, and the gist of it was 'go travel'... i.e. by default be in a 15-20 hr/ wk (max) work setup so you have time to explore things as they pique your interest.
What we have left is a term that's used to whack people who could add value in a lot of way to only think they can do it if a VC gives them their blessing of worth, validation and permission to innovate. I don't think that's accurate or fair to anyone.
For entrepreneurs, there is no lifestyle business, or owning a business until it can run without you.
There are plenty of SaaS businesses in the $1M to 5M/yr range that would be perfectly suitable "failures". To me, it doesn't seem unprudent prudent to collect a few of these "lifestyle failures" and be ready to build the $100M company instead of taking moonshots without any experience in building a business.
I'm pretty sure any startup in the bay area is a counter example of your argument.
This is a fundamental economic concept - the more of something you have, the less value you derive from each incremental unit.
So, based on personal preferences, once you reach a certain level of income you will start to substitute away from labor (income) towards leisure/free time (non-market activities such as hobbies, cooking, parenting, gaming, chilling).
The study data shows this pretty clearly (if I'm reading it correctly) - in Study 2b (wealthy people polled at a science museum) the median household income was $100-149k and the "% Time Oriented" was 69%. In Study 4 (online panel members who get free internet in exchange for survey participation) the median household income was $75-85k and the "% Time Oriented" was 46%.
The implied result that upper middle class folk are able to spend more time on leisure and are therefore happier on average than regular middle class folk doesn't seem too groundbreaking.
I came to a different conclusion. The wealth of time (total man-hours or aggregated lifespans) is more evenly distributed across a population than is the wealth of money. Therefore, to the extent that happiness is influenced by comparing how well-off you are vs others, a person picked at random will be pretty damn close to the same standing as whoever is the Time-Richest Person in the World. But they are FAR less likely to be anywhere near the Money-Richest Person in the World.
What I mean by that is the ability to either fund "vicarious" experiences. ("If I worked on this project, I'd do about the same thing as that person, so I'll hire them to do it.") As well as the more conventional kinds of acceleration like finding it easier to more frequently have more peak and different experiences like travel.
What we need is an inversion of the "diminishing marginal returns" concept to permeate economic theory. Maybe some people just call that Keynesian theory?
I think the real takeaway isn't about upper middle class versus regular middle class. Rather there is quite a lot of negative value / lost opportunities by drawing the poverty line so low.
Though not specifically relevant to your post, this "law" doesn't always hold. Some goods have a utility threshold that must be crossed before they become valuable or increase in utility (e.g., various medicines and antibiotics). Money operates similarly, i.e., its utility does not necessarily diminish, much less in monotonic fashion. Assume that if I make N dollars, I may be able to afford popcorn or I may be able to afford butter, but not both. Let's also assume that I derive little satisfaction from popcorn or butter alone. However, if I make N+1 dollars, I can afford both popcorn and butter from which I derive a great deal of satisfaction. The addition $1 has greater utility than the Nth dollar I had previously.
"Oh, with 15k I could buy a compact car that I wouldn't like much, but with 30k I could buy an entry level sports car that I would enjoy a lot. So the second 15k has greater utility than the first 15k."
Does this make sense? Of course not. The first 15k can buy you reliable transportation which is more valuable than the fun from a sports car. 15k can also pay for a year of housing and food in many places, which has way greater utility than the ability to drive like a jackass on the highway.
With your N dollars, you might not enjoy the popcorn without butter, but you could also buy something else to eat, or some fuel, or any number of other things that have more utility than butter on your popcorn.
Every dollar adds additional things that you could purchase. But each dollar comes with declining utility. First you get necessities, then wants, then luxuries. If you have insufficient dollars to buy popcorn with butter, you probably need to spend your money on something now useful than popcorn anyway. Popcorn is a want and you probably haven't met your necessities.
Growing from subsistence to investment has near infinite. Marginal utility.
Maybe that last $2 don't have greater marginal value than the $8 in your pocket, but that $8 loses its perceived value the moment you realize you won't get additional $2 in time.
It's not a hypothetical situation, by the way. I've been in those several times in the past, and followed exactly the same pattern of emotional reasoning.
Free time is absolutely the most valuable currency. If you can practice an instigative hobby and augment that hobby with the good money you make, then you've got it made. I have a bloody ton of hobbies and I can't wait to get out of work to work on my own stuff.
Seeing my days/life in two parts as stability (day job) being fuel for my hobby has helped me deal with my identity crisis when I got completely turned off from coding. It was also my hobby so I was always coding, but once I lost that I didn't know what to do and I hated my job. Once I saw it as fuel, no matter what day job I have, is now in context of a hobby.
I could not think of someone I'd get along with less. You must be much older than me. This is exactly what I'm talking about. I'd never want to listen to someone tell me about the history of something, that's boring, that's regurgitation, I can google that. If you've made wine before though, that's definitely interesting.
This Reddit thread was one of the most interesting things I've read recently: https://www.reddit.com/r/history/comments/3zgffa/what_is_the...
And I'm in Phnom Penh now, having done the tour of the Killing Fields and S-21 prison. Learning about Khmer Rouge, Pol Pot, and even refreshing my memory about communism, the Soviet Union, Joseph Stalin, etc. I'm finding it all very interesting now.
But also I agree with the commenter above you, "creative hobbies" would make more sense than "instigative".
Check out 4:06 from this scene from "The Aviator": https://www.youtube.com/watch?v=1Z1pPyarKhA
Lady: "We don't care about money here, Mr. Hughes"
Howard Hughes: "That's because you have it"
If you look at table 3, which is a study of the museum going group, you can actually see that SWB (subjective well being) is mostly correlated with household income and material affluence. However in table 3a, we can see that SWB is negatively correlated with material striving.
In other words, people who are concentrated on making money are the people who don't have money and are also unhappy.
People who value time are the people who already have money and don't have to worry about it.
The conclusion I would make from this is that the more money, and implicitly more time freedom you have, the happier you are. If you are trying to make money but don't have any, you're not happy.
"Money doesn't make you happy, but lack of money does make you unhappy."
>
> "Annual income twenty pounds, annual expenditure nineteen [pounds] nineteen [shillings] and six [pence], result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."
- Charles Dickens, David Copperfield
One perfectly plausible explanation is that people who already have plenty of money tend to value time over having a little bit more money. And people who already have plenty of money are happier than people who are a bit short on money.
It's easy for us to say money is nothing vs time, but less easy for the single mom working at wal-mart 60hrs a week to feed the kids.
Perhaps it should have stated that being happier correlates with valuing an additional minute of leisure time at a higher amount of money.
And that is as much as saying that people paid more for their work are happier, which seems almost tautological.
Personally, I've been much happier since I dropped to part time, giving up (some) money for (some) time. I'll be even happier when I take that next step toward full retirement.
http://pl.atyp.us/2013-10-leaning-out.html
Things have changed only a bit since then. A couple of years' worth of still-increasing income have brought me even closer to permanent financial security. I'm still pretty unimpressed by where this industry is headed technically, socially, and financially. I still want to finish one more Big Thing for pay, maybe one more on my own, and then just dabble in whichever smaller projects catch my fancy. I know, based on the responses to that blog post, that I'm far from alone. I suspect that many people reading this will eventually end up in the same place, whether they believe it now or not.
I'm young blood, so I have hope for where the industry is headed technically and financially (not so sure about socially...). Then again, I don't really have a choice but to have hope otherwise my future doesn't look too bright :)
Time is more valuable for some--book lovers, hobbyists,daydreamers, etc... Money is more valuable for others...earning it, the implied security of holding it, etc...
It seems to me, based on experience, that the route to general happiness is to eliminate as many things as possible that past experience has led you to believe won't make you happy...
A life spent in contentment, interspersed with moments of joy (or, happiness) is likely all that humans can resonably hope for...
You have a steady income of time, you can choose to spend some of that on money, but past a certain point of wealth, the money ceases to be the most valuable use of your incoming time.
It turns out that if you are happy, you are disproportionately likely to have time as a scarcer resource than money...
I have some bums I know that can testify the same: having time and no money sux.
I have written Klines of codes in a lot of language, but writing big brother software that impoverish people even if my boss gives me extra time for my life balance makes me sad.
These studies focus on biased population that don't experience poverty, nor seems to care about the others either by ignorance or by convenience (which is worse).
I am ruined, anxious, not(happy) (which is different from unhappy) ... but I still have the will to be able to help people suffering more than me... and worst of all I cannot even donate my blood, I come from Europa in Canada.
But not being happy does not mean being down. I am superficially unhappy, I will find a way to make things better for both me and people I meet.
Happyness is like rain, boring and cold. But it makes you enjoy the sun.
I am not happy and I am angry. It makes me feel as alive as when I wed with the one I love. Being told that not being happy is negative, is the same as if I was told to cut my balls because dick is so much more important.
Sorry, I like them both.