This is a more difficult question to answer than you might think.
First, resist the urge to invest in anything specific at first. No restaurants. No kooky ideas. And no start-ups. No AngelList. Many folks just flush a big chunk right down the drain with gut-level and glamour investments.
Second, understand how you think about inflation. This is a lot of money. One option is to Do Nothing. This is >not< a terrible idea. Look at all the professional athletes that end up broke. So many. The only terrible part of doing nothing is inflation. If you do nothing, every year, that $5m shrinks on a real basis. But. There is no inflation in the short term.
Third, be honest about your risk tolerance. In ‘08-’09, I was 99% in the stock market. 99%. No cash (not even enough for expenses), no bonds. My net worth plunged > 50%. I was devastated. It took me years to recover. In fact, I am not sure I have yet recovered. Even though the markets have.
Fourth, just put it all in VTI. This is my #1 bit of advice. Put it in a broad, U.S-weighted stock market index like VTI. It is almost impossible for 95% of us to do better. You may do better here and there, but not with all of it. With VTI, you are done in about 60 seconds.
Fifth, yes, buy a home. It’s not a great investment but it’s not a terrible investment and it has good leverage and you’ll enjoy it. Just stay within your means. It’s also a super easy way to slightly diversify your portfolio.
Six, if you don’t put it all in VTI, don’t put more than 10% in start-ups and high risk investments. Just don’t. You will lose it all. Or even if you don’t, these investments will be highly illiquid. Lose 10%, it’s OK. Lose 50%, you may be devastated.
It’s hard enough to make $5,000,000. Almost no one does.
Turns out it’s even harder to make it twice.