Let’s break it down.
First, $1m-$2m is the most important amount of money to make. Period. Because you can’t retire on that, not usually, not really. But. You never have to work for The Man ever again. This is glorious.
So congratulations — you have the most precious type of freedom in the workplace there is. Never having to work for The Man. And in the U.S., in the Bay Area, you need about this much money for that really to be true, usually.
Second, don’t spend more than 5% of it. Save the rest, at least for now. You will never recover if you lose it all on stupid investments like restaurants, start-ups you barely know, real estate investments you don’t understand, etc. Put the rest into VTI or something similar. Buy a new car, even a Tesla if you want, but stop there. Buy a house — it’s a not a terrible investment. Just buy one you can afford. Don’t change your lifestyle too much, don’t change your personal burn rate too much.
Now. What next?
Take a break. Start there. Yes, go on vacation for a year if you want. I did after I sold my first start-up. And after I sold my second one.
Then, start another one — if you really have it in you. This time, you probably need to do 10x better. Can you do a $10m exit (to you) next time? If you believe it, go for it. If not, don’t. Starting something from scratch is too hard otherwise.
If you don’t have another one in you, take your time to find something you are passionate about. With $1-$2m in the bank, you still need current income. But it doesn’t matter exactly how much you make, or when, or how. Take the path that comes to you. Love it. Join a friend as a co-founder. Go work at Facebook, just to see what it’s like. Follow your dreams.
Because now, you really can.
