Should You Start a ‘Startup’ or Build a Cash-Flow Business?

“I should be used as a mercenary, not a lifer.”  – Tim Ferriss

In this episode, we have a change of pace…

Expa (@expa) is a startup studio. It was founded by Garrett Camp, who co-founded Uber. Every once in a blue moon, they put together a night of education. I was recently invited to participate in an event.

In this episode, I discuss the topic of startup design vs. lifestyle design. Some of you may be aware that I’ve been involved with various startups ranging from Uber to Facebook, Twitter and DuoLingo, and other businesses that have grown to more than 100 million users and customers.

Simultaneously, I have written about lifestyle design many times, and I’ve suggested that it should come before career planning. The question is, how do we reconcile these two different approaches to business?

Should you focus on building your muse and creating a cash-flow focused business to fuel your ideal lifestyle? Or should you swing for the fences and bet it all on a startup that is equity-driven? This podcast explores these topics — and many more — and aims to answer the questions that I think are under-examined.

Listen to it on iTunes.
Stream by clicking here
Download as an MP3 by right-clicking here and choosing “save as”.

Want to hear another podcast related to customer acquisition? — Listen to my podcast on how to build a large audience from scratch. In this episode, I answer some of your most-asked questions (stream below or right-click here to download):

This podcast is brought to you by 99Designs, the world’s largest marketplace of graphic designers. Did you know I used 99Designs to rapid prototype the cover for The 4-Hour Body? Here are some of the impressive results.  Click this link and get a free $99 upgrade.  Give it a test run…

This podcast is also brought to you by Wealthfront. Wealthfront is a massively disruptive (in a good way) set-it-and-forget-it investing service, led by technologists from places like Apple and world-famous investors. It has exploded in popularity in the last 2 years, and now has more than $2.5B under management. In fact, some of my good investor friends in Silicon Valley have millions of their own money in Wealthfront. Why? Because you can get services previously limited to the ultra-wealthy and only pay pennies on the dollar for them, and it’s all through smarter software instead of retail locations and bloated sales teams. Check out wealthfront.com/tim, take their risk assessment quiz, which only takes 2-5 minutes, and they’ll show you—for free–exactly the portfolio they’d put you in. If you want to just take their advice and do it yourself, you can. Or, as I would, you can set it and forget it.  Well worth a few minutes: wealthfront.com/tim.

Mandatory disclaimer: Wealthfront Inc. is an SEC registered Investment Advisor.

Investing in securities involves risks, and there is the possibility of losing money. Past performance is no guarantee of future results. Please visit Wealthfront dot com to read their full disclosure.

QUESTION(S) OF THE DAY: Are you building a cash-flow business or a startup? What problems and questions do you currently face? Please let me know in the comments.

Scroll below for links and show notes…

Enjoy!

Selected Links from the Episode

Learn more about Expa
Margin of Safety by Seth Klarman
Secrets of Power Negotiating by Roger Dawson
Getting Past No by William Ury
Anything You Want by Derek Sivers
Built to Sell by John Warrillow
The E-Myth Revisited by Michael E. Gerber
Buffett: The Making of an American Capitalist by Roger Lowenstein
Listen to interviews mentioned in this podcast:

Jocko Willink | Rick Rubin | Neil Strauss | Josh Waitzkin

Jon Favreau | Robert Rodriguez

Thinking, Fast and Slow by Daniel Kahneman
Small Giants by Bo Burlingham
Learn more about Derek Sivers

Questions From the Interview

How do you decide to invest in companies like Twitter and Uber? [8:06]
Are we in a bubble? [16:31]
Can you talk about your first business, BrainQUICKEN? [20:41]
Can you talk a little about bootstrapped businesses vs. venture-backed businesses? [26:16]
Are there examples of happy VC-backed founders? [29:16]
What approaches have you seen that are successful in venture businesses, and do you actually work 4 hours a week? [30:46]
Can you tell us about the distinction between a good CEO and a good founder? [36:16]
How do you factor happiness into work ethic? [38:06]
What are great examples of CEOs and founders who are killing it? [39:31]
How has your understanding of neuroscience affected your writing? [43:36]
Why prioritize wants vs. needs when starting a business? [47:46]
Who are your favorite podcast guests and why? [49:26]
Should a solo founder find a co-founder? [52:21]
What have you changed your mind about in the last year or two? [55:16]
Deconstructing “What next?“ in a lifestyle business, and the challenge of identifying “the one big problem.” [57:51]
If you had to choose between being an investor, writer, or podcaster, which would it be? [1:03:16]

People Mentioned

Mike Maples Jr.
Herb Kelleher
Steve Jobs
Warren Buffett
Marc Andreessen
Rick Rubin
Daniel Kahneman