The five-year plan, $1k to $10M. Met 2020 goal!
A few years ago, I successfully transitioned from a liberal arts degree to a dream job with a software engineering title. (That's a separate story that I'll write soon.) Importantly, the process took four years, which I spent reading HN (IH wasn't really around at the time), and Googling my way piece-by-piece until I had my very first app that made some money.
If I could make that drastic change in my life in four years, perhaps I could do it again? So, I think it's not crazy to shoot for a $10M business in five years, this time by reading IH and Twitter and experimenting with more ideas and more services.
Each year adds a zero to the goal total revenue:
- 2020: $1k (already succeeded!)
- 2021: $10k
- 2022: $100k
- 2023: $1m
- 2024: $10m (and sell it for that much)
Each year also adds a new challenge. How do you 10x the thing you just did?
Recently, Baremetrics shared some really fascinating aggregations of their customer data (more on that here: https://twitter.com/blakerson/status/1306283208485474304 ) and the numbers showed that getting to an extra digit is a pretty big effort, but going from $1k to $2k or from $10k to $20k is significantly less challenging. That makes intuitive sense to me. I also find that motivational and a great setup for 2021, where I want to get to $10k.
I mentioned above that I hit the $1k goal. Here's that revenue, broken down:
- Book sales: $493
- Service sales (from a service I've been testing): $750
- Total: $1,199
With two months to go in 2020, there's room yet to hit more milestones. Maybe $2k is in reach! It is easier than $1k was, right?
When planning 2021, however, there's a clear winner: the service is the one that could scale to $10k, not the book. The revenue is higher (thanks to a higher price point) and it's recurring. Worse still for books, book sales are on a decay curve and fall off after a couple days.
Overall, I remembered that I was able to make prior dreams come true, it just took a lot of time. I think that having patience with myself will pay off on this particular adventure, too. I encourage IHers to take the long view and maybe consider the five-year plan!
Thanks @blakerson! I’m also a career-switcher from humanities into a role as software engineering.
I like your 5 year plan... I might consider that starting in 2021 :)
Thank you! Shout out to humanities folks. I think that they still make for better leaders and think more clearly, all else being equal. But I admit that IH is all about the “anybody can do it” vibe. So if people can learn to code, and learn business, perhaps they can learn ways of thinking too?
I am liking the idea and concept. All the best man. Keep us posted.
To the casual observer this may sound impossible, but the first four years of this trajectory are actually surprisingly possible.
I have a similar 10 year plan (slightly smaller milestones, spread over 10 years).
What I’ve found is that it is the middle years that are really challenging to hit on a specific timetable.
At that point, even if you have a clear vision and sound business, the last 3-4 years are shaped largely by a form of sequence risk (similar to retirement investment).
That is, the order in which the returns occur has no effect on your outcome if you aren't either investing regularly (buying investments) or withdrawing regularly (selling investments).
Once you start withdrawing income, you're affected by the change in the sequence in which the returns occurred.
I base this observation on a group of hyper competitive college classmates who all followed surprisingly similar entrepreneurial paths.
But even though we all did pretty well, a lot of the shorter term variation came from lifestyle/personal situations (buying a house, finding greater return of capital, relocating aggressively, etc.).
But if you keep reinvesting aggressively into your businesses (are able to based on personal situation) and avoid tying your money up, you would seemingly have the quickest trajectory to 10M.
Only one of made it all the way to 10M in the roughly 6-7years so far (wasn’t me lol). But he also dropped in our ranking this past year with a significant dip in net worth (~3M drop).
We are all more concerned with net worth than revenue but I look forward to seeing updates on this :)
Anyway that’s my random insight! Haha
Thanks for sharing!
Fascinating! Definitely makes sense to take the financial long view in such an endeavor.
Thank you @blakerson for realising and showing us the revenue goal. This post educated me a lot how a SaaS revenue looks like.
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Thanks for the kind comment! The key to Pareto optimization is that it’s the 20% that you do that can achieve 80% of the result. That said, however, I spent much of this year doing inefficient things, only to find that doors opened along the way. Sometimes it doesn’t hurt to wander around.