I read the The 4-Hour Workweek at a major turning point in my life. I had just left the Army and Stephanie and I were taking a road trip from Alaska to Michigan where I was going to start my MBA program.
I still remember how excited I was. My last few years in the Army were particularly difficult and I was elated that it was over. I had wanted to throw myself into entrepreneurship for years and the time had finally come.
A few weeks before leaving, a friend of mine insisted that I read the Four Hour Workweek. The title sounded incredibly spammy, but I bought it anyway. I started reading the book as Stephanie so kindly offered to take the first driving shift on the second morning of our road trip.
(A beautiful lake that we stopped at to get out and stretch our legs. If I remember correctly, this was about a half-day before getting to Muncho lake in Canada.)
The next few hours flew by and before I knew it, I had consumed the entire book.
I was in love.
I felt like I had just read something that had been written personally for me. After years of living a life where nearly every aspect of my existence was dictated by the Army, I was incredibly susceptible to the concept of complete financial, geographic and time freedom. It was refreshing to see the way the book challenged deep-seated assumptions about the choices we have in how we live.
As an entrepreneur at heart, the part of the book that really spoke to me was about “Engineering a Muse” which is how I was supposed to fund this new and exciting lifestyle. For the next couple of years, getting my MBA and finding a profitable muse were my main goals in life.
Based on the title of this post, it may seem that I’m about to dive into a diatribe about how I hate Tim Ferriss and that how the Four Hour Workweek is a complete joke. That’s not at all the case. I still read Tim’s blog and I’m still happy that I read the book when I did.
But “engineering a muse” does not usually happen the way described in his book.
For the next couple of years, I experimented with a bunch of muses.
Some things kind of worked. Most of them were complete flops. After testing about a half dozen ideas I realised that something wasn’t quite right. I couldn’t see how any of these muses (or even a combination) was going to lead to enough money to fund the sort of lifestyle I wanted to have. On top of that, I realised that none of these muses were actually passive revenue – they all required a fair amount of ongoing work.
It wasn’t until a couple of years later when I had a bit of success in entrepreneurship that I realised where I was previously going wrong.
Passive revenue is not what it sounds like. There are very few forms (if any at all) of truly passive revenue.
SEO seems to be the favorite that every internet entrepreneur tries at some point in their journey, and it goes something like this:
1. Find some search terms that have a lot of traffic and low competition.
2. Create a site with some great content to capture that traffic.
3. Sell something to the traffic or make money from ads and affiliates.
This can work, but it’s incredibly risky. It’s risky because you’re investing a lot of time researching something you probably don’t care about to create content that might rank highly, just to be susceptible to Google changing their search algorithm and losing everything overnight.
Tim recommends some other non-SEO models such as drop-shipping, info products, etc. – but it’s all based on a similar premise – find a market and sell them something. On the surface this seems like a reasonable strategy, but it’s ignoring a critical element:
The whole “let’s figure out how to fund a lifestyle” industry completely ignores how a particular business model, value proposition, problem, niche, audience, philosophy, purpose, etc. – fits with you as an individual. They tell you to start with “where is an audience that can I make money from” instead of “in what areas am i uniquely positioned to provide value that also has the ability to fund my ideal lifestyle?”
That’s the difference. Value.
In ten years, you don’t want to look back and see a niche site that talks about dog food, an eCommerce site where you sell doll dresses and an info product about the Southern Canadian logging industry – even if it is able to make you enough money to live off of. (unless of course these niches are a good fit for you)
These muses will still require work. New content needs to be created for niche sites. People want refunds and have complaints for eCommerce products. You’ll have competitors in all three that will be actively trying to take revenue that you mistakenly thought would be passive forever.
These are businesses. You can call them muses all you want, but it doesn’t change the fact you’re running a business.
How passive a business is shouldn’t be the focus. (Yes, how scalable a business is and how much it can be leveraged are important. But focusing on how passive it is will get you into trouble.)
People think that they want to sit on a beach all day, but they don’t. You might be able to sit on a beach for a couple of weeks, but you’re going to get bored. When you get bored, you’re going to want to do something.
(A beach I was on in Italy a few years ago, an hour or two outside of Rome.)
You’re going to realise that you want to be productive. You’re going to want to create something of value. And guess what, that productive thing that you would do, not because you have to, but because you want to, has a much higher likelihood of making significantly more money than the things you did just because you had to.
Why not just start with that thing in the first place?
There are a lot of people that feel passion is over-rated. They say that passion is fleeting so you shouldn’t worry too much about it when choosing what business to build – just focus on the problem and your customers and passion will come when you start making money. This is a false dilemma.
Passion isn’t everything, but it definitely means something. While Makers Academy is going great now – there were times that we honestly thought it was going to fail. The only thing that kept us working hard was the fact that we genuinely cared about helping people learn how to code and get better jobs. I struggled so much teaching myself how to code that I really felt (and still do feel) passionate about this problem. I can’t tell you how many times I’ve used the phrase, “Well, if Makers Academy dies tomorrow – at least we helped a whole bunch of people change their lives by learning to code.”
Passion isn’t sufficient, but a sufficient amount of passion is necessary.
It’s a similar concept to happiness as put by Shawn Achor in the TED talk below.
Most people think they need something (money, a significant other, etc.) in order to be happy, when in all reality being happy will increase your chances of attracting those things.
If you say you’ll work on what truly inspires or suits your unique talents once you have X (whatever X is), you’re probably never going to get there and, more importantly, you’re going to be wasting years of your life working on something that you deem insignificant.
There are ways to figure out what type of business is best suited to you and forego the pain of investing years into something that brings you zero satisfaction. There are ways to build something that excites you, a business model that fits with your particular personality traits, lifestyle design and unique talents.
You shouldn’t be drop-shipping coffee mugs from China if you’re not interested in coffee mugs or your personality isn’t suited to drop-shipping. You shouldn’t be writing a blog and creating an audience of followers if you absolutely despise writing and interacting with the people in your target audience. This is a waste of a human life. You’re not going to enjoy what you’re doing and it’s going to show in your work.
We have a limited amount of time on the earth. We should be spending it doing something great.
I agree with Ayn Rand’s statement:
The world you desire can be won. It exists.. it is real.. it is possible.. it’s yours.
Our world is no longer a place where you work for 30 years at a single company and get a pension. Our entire workforce is changing into an economy of temp workers, outsourcers and freelancers.
The concept of lifestyle design isn’t the problem. Thinking about “my ideal lifestyle” and “how will i fund it” as separate entities is the problem. They overlap so significantly that it’s pointless to try and decouple them.
The solution is to figure out what you’re uniquely suited to do to create value that can be sold. It doesn’t matter if you’re “not an entrepreneur” or “don’t have business training” or “insert excuse here.” Every person is different with unique values, beliefs, talents, interests, hobbies and passions. There is a profitable mix in there somewhere – you just need to find it.
How can you do this?
Inventory yourself. What do you do when you find yourself with an afternoon free? What kind of advice do your friends come to you for? What unique talents do you have? Are you commonly known among your social group as an expert in something? What thing do you strongly believe to be true that the majority of other people don’t?
Figuring out what you’re best suited for isn’t a binary event. It’s a process, but there are things you can do to expedite the learning. I’m going to be writing about this process in the next few weeks.
If you’d like to be notified, sign up for my newsletter or just check back.
It would be great to hear your thoughts on creating value versus just focusing on creating money in the comments below. Is this something that you’ve struggled with in the past or are currently struggling with? How have you tried to solve it? Are you still trying to solve it?