Random Observation/Comment #795: Wealth is when your passive income exceeds your expenses.
Why this List?
I don’t remember where I heard this, but it made an impression – “The average millionaire has 6 forms of income.” If you play the game correctly, the salary keeps you in the rat race, while assets that accrue some revenue and/or appreciates in value would create generational wealth.
I’ve previously written a few relevant posts on the topic or financial freedom and digital legacy
- Strategic investment and Portfolio management – My personal investment strategy broken down by percentage and risk weighted levels
- Wills, Trusts and Digital legacy – Building for future pass-on of information
- 30 Communities and your Role – Considering my current engagement with different communities and how much time I want to provide in these industries
- 30 Non Money Investment Activities – Investing in myself through specific activities
How do I analyze how to invest my time and money?
In full analyst fashion, I made a full spreadsheet looking at each stream of income and figuring out these features:
- Initial investment – $100s, $1000s, $10,000s
- Time investment for upkeep – High, Medium, Low
- Overhead maintenance costs – High, Medium, Low
- Risk of loss – High, Medium, Low
- Difficulty / Learning curve – Hard, Medium, Easy
- Earning potential – by % of investment
- Earning potential – by maximum $
- Other requirements – ex. Needs a car
- Chance of success – High, Medium, Low
Full analysis here. Google sheet in all its glory.
I could have done simpler services like gig economy work (Uber driving, Uber eats/post mates, Task Rabbit, etc.) The reason I’m excluding this is because they tend to take up more time and I would rather build an asset with passive income rather than take on more jobs.
Pursuing
- Options swing trading based on patterns – I’m going to continue doing this with small 10% bets. The markets seem random and hard to trade right now, but I get some easy wins following some random market movement.
- Audiobook recording / narration – I’ll first do this with my own book before recording for someone else.
- Build online courses for a MOOC or masterclass and selling seats for them – I’ll be looking to launch one of my courses this year. I have all the material already.
- Write a book – My first book “My Life in Lists of 30” was published in 2015. Hey look, it’s in Barnes and Nobles.
- Get paid to write the second book – I’ll probably write a separate post on this. There’s so many strategies I can put into action leveraging Web3 that’d be a shame if I just did a self-publishing web2.0 boring thing.
- Speak at conferences or for companies (and eventually get paid for it) – I’ve so far spoken at around a dozen conferences. The public recorded ones are on a public YouTube playlist.
- Part time consulting work on any of your skills – Now that we have “Wanessa Labs, Inc”, we just need some basic “statement of work” templates and we can start leveraging our freelancing skills with real companies.
- Learn Devops configuration and scaling/optimization work and never worry about finding a job – I’m definitely learning the fastest ways to deploy at scale. Check out vercel! It’s never a bad idea to know multiple AWS products and optimizations.
- Invest in startups for equity – I tend to only invest in later stage (post-accelerator with promise towards a Series A) startups with a strong trust with the founders.
- Join advisory or board of directors for early stage companies or within an incubator/accelerator program – I’m currently conducting the education and consulting workshops for our internal startup advisory practice as well as joined a few other companies as an advisor. Note the advisor role can be carved out to your desired level of detail. Some advisors just show up to a monthly meeting and help make some recommendations or introductions based on their reputation in the industry. Other advisors might be more hands on with delivering a certain proposal or giving feedback on the market approach.
- Build and launch VR and AR apps and be first to market – Many people think this will be a flop, but I personally think it’s just cool to develop some of these assets. Launching a “web3” asset like an NFT or new protocol sounds much cooler than what you can tangibly view or show off.
- Design and launch an NFT collection inside a DAO – I’ll likely do this for my second book.
- General DAO consulting services – Working at Raid Guild is not that hard and mostly part time. I firmly believe you can’t do more than 5 projects at a time.
Don’t Pursue
- Buy real estate and pay a company to fix it to flip it – I can barely get my own house fixed. I think this only works if I’m also a handy and competent home owner.
- Selling Stock photography or Artwork – I used to do this, but this will be completely replaced by midjourney and AI creation of assets. We will pay for the service and not the specific artwork.
- Doing small tasks that might be easy to hire someone else to do (fiverr, Amazon mechanical turk) – I need to do a full analysis of my skillset and what services are requested. I’d look at this like bounties. I’ll only pursue a bounty if I know I can complete it.
- Baby sitting or dog sitting – Even though this is manual work, you might get joy in visiting some kiddos and doggies
- Flip items from garage sales to sell on eBay – There have been so many times my wife has told me to get rid of something and I wonder “Can I sell that on eBay to recover some loss?” – Long answer short – It’s never worth the overhead and scams.
- Flip items from digital marketplaces – Buy from Alibaba and sell to Amazon – you can automate some of these services. See above. I don’t really want to grift and make this world worse.
- Joining a poker tour or doing online professional gambling (this can include Draftkings) – I hate gambling and I’m terrible at poker.
Maybe Pursue Later
- Building and running a trading bot – I used to run a few trading bots until they got out of control. I may still run one off of LEX algo or something built by chatgpt, but I don’t know if I’ll put a lot of money into it.
- Buy real estate and use a property management company to manage it – If interest rates were lower and there wasn’t a looming war, I’d probably be more bullish on this strategy. I personally don’t like being a landlord.
- Advertising revenue for your digital medium (e.g. YouTube channel, blog, podcast) – I want to tie this into all of the things I work on so the assets I create are all generating some type of revenue. In order to make sense of this workstream, I really need to just focus on one initiative.
- Buy into early stage wait list releases of cars like Tesla Cybertruck and Rivian and then sell into a secondary market – It’s also just cool to have a new car. Unfortunately, the wife doesn’t want to have this as overhead. Agreed that this could be more troublesome and risky than real estate.
- Buying a boring business like a car wash, laundromat, or franchise and having someone else manage it – Following Codie Sanchez, I believe she has the right idea on diversified ideas and doing boring things that scale. I also think the market for buying these businesses will be more affordable after a macro meltdown.
- Executive produce a movie, documentary or Broadway show – This is more of an illusion of investment in exchange for access. Most documentaries and shows are losses.
- Adjunct professor for special courses – I think I’d pursue this after launching the MOOC.
- Make websites for existing crappy designed business sites – Honestly, I can probably leverage ChatGPT or some other services to review sites and recommend upgrades. The optimization and flip could all be digital.
- Build and launch a mobile app and sell ads – This is also a classic strategy of building assets. A live iOS or Android app on the mobile store could get a few 1000 installs can yield some income. The space is saturated, but there are plenty of games you can own and monetize.
- Build and launch a DeFi protocol with tokens – I’ll hold off on launching these types of assets until everything is better classified. I would rather do nothing than take risks.
~See Lemons Build Assets
