Ask HN: What to do after graduation with 100k?
Background:
I'm 21 and currently approaching the final year of my undergraduate degree at the University of Virginia. I'm a business major at the McIntire school which is fairly respected (http://www.businessweek.com/bschools/rankings/index.html) and concentrating in management with a sort of sub-track in a newly launched entrepreneurship program that I'm excited about (co-taught by some entrepreneur alumni). The business program is a two year program and I came out of high school with enough college credits that I've been able to take more or less any classes I've been interested in (mostly Philosophy, Political theory, Psychology.. I seem to like the P's). I absolutely love the college academic environment as I love learning. As a result I've done excellent in school all while managing to have sometimes too much fun in the process.
I got involved with my first web based start-up when I was 13/14. I saw a business model (niche market, digital product related), thought I could do a better job, and more or less copied it. Within a year I ended merging and working with the business I copied. My age never really came up until I was there for a while and at that point I was 17 or so and the owner ended up getting out of the business and I split off with some others and we formed our own company doing the same thing (although a bit better). We ended up growing the firm to $250,000 in revenues with a great profit margin, however at that point we became distracted and complacent (I was enjoying college, the head "techie" partner was rapidly advancing in his day job as a programmer, people got married and had first kids etc.) and more or less let the business die down.
I've played with a few other startup ideas since then related to the same niche I had experience in (one was doing fine, but I didn't have the passion for it and couldn't deliver a product/service that I thought was good enough so shut it down; another I started last summer and the business model works and it is generating maybe a steady $10-20 a day, but that is only with about 100 unique users a day..it's very scalable and is designed to be a semi-passive cash cow but am having trouble bringing in the traffic; if I could get 1,000 targeted uniques a day probably about $100/day and so on). I just recently bought out a partner of the original start-up and am trying to bring it back to where it was before. However, the competition is a lot stronger now, and I'm a bit burned out of the business and would probably prefer to work on other things.
In this process I've managed to save about 100k in cash/liquid assets that aren't in a Roth IRA or anything like..and I have my expenses for next year (class/rent/food) covered. The question deals with what to do with those assets...
The Question Arises:
This summer I'm interning at a global high tech physical manufacturing firm. Great brand name, the compensation is great, and I'm more or less doing a lot of financial analysis and writing whitepapers related to internal business processes and international banking. All the main projects I work on are fairly interesting (Even if most of my downtime I'm doing silly intern things like the occasional printing, photocopying, filing, or any work someone else doesn't want to do etc.) and I work with good people...but really don't seem to like working for a large corporation. All the roles are so specialized and bureaucratic, it's very 8-5 cubicle work, and there just seems to be a constant "cog in the machine" alienation from the work that is being done and the finished product. I've realized I really don't like that. That's partly because the finished product is unbelievably complex and there isn't really another way to setup the system, but I feel my early start-up experience has spoiled...
41 comments
[ 4.5 ms ] story [ 252 ms ] threadI wouldn't invest a full 100K right now in unless I had more to go round ;) (I do run a fairly large investment pot for me and some friends - things take a bit of managing atm)
Do you really want to do a startup in which you are the main investor and employee? Seems like you would be better served letting the money work for you in the stock market while figuring out ways to self-fund with current earnings or outside investors. Having your own wealth as a backup plan will give you more negotiating power, but it doesn't necessarily mean you should be filling all of those roles yourself.
So that means you currently have 5 years of complete freedom to discover what it is that you want to do.
Move to Silicon Valley, start a startup, or join one. Or go travel. Nothing really broadens your mind like travel. And you can easily do that on $20,000 a year if you have no other commitments.
It's not $100,000 that you have saved up. Its 5 years. Keep thinking of it that way and you'll realize what you want to do.
- $700-$1200/mo for rent+utils (1BR in shared space, south bay vs. SF)
- $200-$500/mo (cooking vs. eating out)
- $50-$400/mo (ascetic vs. lover-of-gadgets)
- $200/mo for basic healthcare + other bills
- $100/mo for public transportation
- $100/mo for exigencies
Feel free to email me if you have questions! (see profile) I've been working for six months in SF, living in MV.
By the way, I think it's great that you have a sense of perspective already (and the savvy to be filling your Roth IRA...) that kind of stuff is priceless.
It's funny, I'm basically in the same position you are- 1 year of school left,business student, and I have enough money saved up from my Internet marketing business(and some good revenues still coming in) that I don't feel any need or pressure to go look for a corporate job. I'm going to school in the boring Midwest, and seriously contemplating moving to Silicon Valley or traveling through Asia after finishing school.
By the way, about your business, getting traffic is the eays part, it's getting them to convert that is the issue. If you can consistently be earning $100 CPM from your visitors, you should have no problem getting that traffic with some precisely targeted advertising campaigns (or maybe even SEO). It's trivial to get a couple thousand uniques a day for almost any niche with a bit of SEO/PPC work, provided you're monetizing them well, so with any luck, you won't need to use that 100K at all- you could live quite well off revenues from your startup as you travel the world.
graduating, send me an email to ilya[-at-]unviral.com I'd love to chat about this further.
Travel at this stage of your life will pay off the rest of your lifetime. You will cherish such experiences forever, as they will regularly inform your actions.
as for programming, the new languages (python, ruby) are much easier to learn and use than C++, and just as powerful language wise.
Living in Silicon Valley is good advice - it's the right place to be to do some networking. You seem to be good at identifying opportunity - just make sure you talk to lots of other smart people and understand what they're doing, what they find difficult, etc. You'll know it when you hear something that you want to get involved in.
Then live frugally, like a college student. The 100K will support you for the next four years. To be able to devote 100% of four years of youthful, intelligent energy towards one of the world's problems without other major life distractions (school, job) would be an amazing resource and you could have a tremendous impact. (An important component of this should be finding something that excites you, rather than just responding only to a feeling of guilt).
I disagree with the commentors who suggest you should invest your money. You're an entrepreneur. If you want another 100K, you can go out and do something to make that. (I would however recommend never, ever, going into debt: never spend money you don't have on the assumption that you'll be able to make more later; this is a powerful reality check that ensures that you really are doing what you think you can).
I expect other commentators to voraciously disagree with my suggestion that you spend the money supporting yourself instead of saving it; I'll just note that in advance so I won't feel like I need to respond to any of the responses.
- Kiva (& similar microlending orgs) seems like a nice way to put some portion of that to work for good causes, without it disappearing nearly as fast as simple charitable giving would make it go.
- If you own a place to live outright (no mortgage), even if it is a tiny apartment, you have an incredible amount of flexibility in your life that you would not have otherwise. (Of course, that flexibility is more interesting if you are living in SF than in Montana.)
(edit: paragraph breaks.)
Give 10k as a gift to your parents and close family.
40k left. From that, mark 20k for one year living expenses. The remaining 20k, use to launch a business. So you have 1 year where you can work on building your own business without any other worries or stress.
If at the end of that one year, you have failed, get a normal job. If you succeed though, you will turn that 20k in 200k soon enough, God willing.
Make it a goal to be able to retire by the age of 40. Ponder life and the purpose of life and the reason for existence.
For all of your explaining, you never got around to saying what you liked doing. Do you like working for yourself or in a team, do you want to pursue education at any cost, or do you want to fit into some large corporate system?
It sounds like you enjoyed your startup experience and would like to repeat it, but I'm not sure.
I can tell you what I would do, because I'm getting ready to do it again. Find something to pour yourself into for a while, and enjoy working on something bigger than yourself. This can be another startup, or charity, or creating a new solution for world hunger, or whatever, but the key is that it can't be simple self-gratification.
Doing this allows you to grow, and prevents the over-specialization, boredom, and frustration that can be part of large corps. It also allows you to put some of those fun P-classes to work in a practical manner. But you really have to have drive to make it work.
You could embrace your inner lazy person and work hard for a few years with the idea of retiring early. That's a cool plan. But the real question is whether you're going to actively do something or passively wait around for life to happen to you. That's a question only you can answer.
Don't give it away. If you can turn 100K into 10M then give 10% of the 10M away.
I am 26, I now have 1 child and another on the way. If there was anything I wished I had done right after graduation it is travel around the world. Since you don't have an immediate need to jump straight into the work force that is my suggestion. You can utilize the time to figure out what you want to do, perhaps obtain a new idea for a start up.
Once you start popping out kids, get a mortgage and everything else creeps up on you it can be hard to find the time to just go on vacation for a week let alone a month or two.
Get some guys together (the more varied the personalities, the better), and spend a month relaxing, drinking, and womanizing. Have some fun, try to break a few laws while you're there. Just do it on the last night in each country, so you can get out. (nothing major, but if you're not kicked out of a single bar, you'll be disappointed).
I recommend traveling until you get tired of it. Explore the world. It's cliche but you do learn a lot about yourself and your culture by visiting others. This can cost incredible amounts of money or it can be very cheap. It depends on your standards and where you go.
It sounds like you enjoy the university atmosphere. Take a look at study abroad programs. My wife delayed her graduation by a semester so she could do this. Or just extend your education, take some more classes. Then you can spend some time traveling. Maybe do Peace Corps. Learn a new language.
After that, take stock of your life and think about what you want to do. You have the financial freedom to do what you want for a few years. You may want to get a job just to learn from others. Maybe you'll want to tackle one of the world's big problems. Or you'll be recharged enough to start a new business.
Since graduating, I've worked hard and lived below my means. 3 times I've saved up a lot of money and then blown it all at once. First was my wedding; next was a summer in Europe; and now I am working on a startup.
I haven't regretted any of it. My only regrets are not doing it sooner; and that I pushed myself through college without spending any time abroad.
If I was you (ok, I live in a different culture):
Two years ago, I happened to have the same problem as you: I can't concentrate on one language and one platform (always jump from one to another), trying basic, javascript, html, php and many other compilers. The solution for this is to follow the Microsoft Track: It's cheap now and promising.
Yes, got Dot Net and learn Visual C# with WPF, it's very amazing.
Here's what I'll do, if i was exactly in the same conditions:
- Move to a cool area, where I can meet with other geeks and find meetups and interesting things to have fun and boarden my mind
- As you are geek (i guess so) and have some knowledge in programming, 6 months will be enough to master Visual C# and WPF (Microsoft Expression Blend). I'll buy a new Computer with Windows 7.
- After 6 months, I should be comfortable with Dot Net, I'll take some accelerated courses and read few books and take Microsoft Certificates (MCPD)
- let say 8 months gone... It's time to make something interesting, let say any application that is simple and can scale. And I want to give you an example (Abyss Webserver) it's a tunisian product (I'm tunisian too) and it's a successfull web server although it's very simple and basic against its rival competitors IIS and Apache but it did succeed, so don't be worried of big competitors.
One thing to say: Be careful before you choose the application you are going to build.
Will it take more than 4 months? You can hire few on the Internet to get it done with you, or just get a partner.
- 1 Year collapsed, it's time to publish your application and start marketing it. Now that's the hardest part and you can either succeed or fail, it'll depend if you made the right choice and choose the correct things: There's things that works and things that doesn't and also how many people need your application and how much are they willing to pay for it.
In a matter of 3 months, you should see if this plan did work or not, if your application was sold or not. If your application was priced $20 and sold 5,000 time then you got your $100K!!
In worst cases, you did learn something and you can NOW work on many companies since Dot Net has a high demand and you are able to change your location.
study this plan, one benefit is that you don't loose anything with it.
Hint: You can start a blog while learning and building your application it'll be fun, provide more clients and may be an extra income in the future.
The obvious alternatives - blindly go work in some fashion, or spend your money funding a startup - are likely to leave you burnt out, because you don't have a good motivation yet. Once you've figured out your biggest passions, then work will be easy and you'll have no trouble feeling productive.
Be specific please.
Personally, I can't get satisfied with landscape/water, so its hard to find cool places :D