Let’s treat our lives like startups, not lifestyle businesses

Expand your balance sheet and invest in personal growth

(image credit, modified)

Most of us were taught from an early age to save money and spend responsibly. Consistent within our schools, homes, and culture generally is the notion that debt is bad, and we ought to live within our means. But this mentality, while well-intentioned, often causes people to underinvest in themselves.

I’m not saying that we should start spending recklessly. I’m not even arguing that we save less. However, we do need to start thinking about money less in terms of dollars and cents, and more as an investment vehicle for future growth and opportunity.

But how? We need to turn the traditional savings model on its head. Instead of finding ways to cut expenses, let’s figure out how to increase earnings potential over a longer horizon by spending more deliberately.

Everything else equal, it’s better to have a bigger balance sheet: you can cut your spending overnight if you really need to, but earnings potential will stay with you for much longer.

Long-term ROI isn’t anything we don’t already know. It’s why parents do everything they can to get their kids into college. Higher education is a high-ROI investment, despite being very expensive. The problem is that after graduation, people tend to move away from a growth mentality and stop investing in themselves.

So where should we invest? There is no right answer, but here are 3 general areas where I’d recommend over-investing:

  • Coaching — this could be a class, or 1 on 1 coaching with an expert (e.g. personal trainer, tennis lessons, private tutor, etc). Whether you’re looking to become a better manager at work or play an instrument, this is likely the most effective way to learn anything.
  • Books — there is an incredible amount you can learn from books, and we are fortunate to live in a world in which virtually anything you could want to read is a couple clicks away. It’s no coincidence that reading is a common thread amongst very successful people.
  • Travel — most people spend >95% of their waking lives on <5% of the earth’s surface [1]. Think about that for a second. This means there’s an enormous amount to learn just from going somewhere new and gaining a different perspective.

Investments should be reflective of your personal goals and ambitions. And of course not everything you invest in will lead to greater success or more money. The one constant we have is time: growth and learning is compounding, so start investing today.

A friend of mine recently observed the difference between lifestyle businesses that make a steady stream of income and distribute dividends to investors, and startups and companies like Amazon that continuously invest their profits toward new innovation. It’s an appropriate analogy for living.

Let’s treat our lives like startups, not lifestyle businesses [2].


  1. Napkin math based on conservative assumptions.
  2. You can run your life as a startup and run a lifestyle business in your life.