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The Rise Of The Million Dollar, One-Person Business

forbes.com

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Re: The Rise Of The Million Dollar, One-Person Business

#61

Post by jsiarto »

mhartl wrote: post #47

It's nice to see coverage of an exciting trend (of which I'm happy to be a part), but it always cracks me up when financial publications classify companies based on sales rather than profits. Defining a "million dollar company" as a company with a million dollars in annual sales is absurd.

This. If your company clears one million in yearly sales and spends $980,000 to make that happen--you are running a $20,000 per year company. There is nothing wrong with this, but I hate when these metrics get thrown around without context. There are $1M companies that make less profit than a hot dog cart (which subsequently, in the right location is a damn good business).

Re: The Rise Of The Million Dollar, One-Person Business

#63

Post by jacques_chester »

Retric wrote: post #27
michaelochurch wrote: post #14

The details behind the article show a less appealing reality than what we might hope for. Yeoman capitalism hasn't killed off VC-istan just yet. A lot of these $1M/year businesses are for, say, independent real estate brokers. Yes, there are people who get very rich in that game. There are others who fail horribly. I think we're quite a way from a society where talented people can find their way to, if not $1M per ye…

One of the key's to high incomes is personal spending habits. Spend 105% what you make and your stuck on debts treadmill. Spend less than 70% of what you make and not only do you have a cushion that lasts longer, but you can take a significant pay cut without issue. Now let's say you have a great idea, if your over 25 then scraping together 6 months living expenses pluss a little working capital is easy, by 30 taking…

Per Micawber's Principle:

Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.

Re: The Rise Of The Million Dollar, One-Person Business

#64

Post by ww520 »

tunesmith wrote: post #33

I think about this a lot - I made the jump from salaried worker to self-employed programmer/freelancer/contractor/consultant (depending on how you look at it). But I'm doing enterprise-level architectural programming. It's not very amenable to productizing, so I'm basically stuck being paid for my time. What that means is that if I want to have a long-term high-security relationship with a couple of key clients, I ba…

Real estate is a good way for lay people to gain wealth with not much effort. You don't need to be a handy man to get into the game, but it helps if you can do the repair work if needed. At the very least know what it takes to get things done and repaired so that when you hire people to do the work, you know the ballpark figure and the amount of work involved.

Real estate investment is good to get into because its cycle is long and very predictable. Just follow the trend. Once the housing price goes one way, it takes huge amount of effort for the market to turn it around. We are just bottoming out and starting on a upward trend now.

Read up on the topics and take some classes if needed. Community colleges have night classes that cover lots of topics. You don't need to agent related topics, just the economics and investment parts.

Real estate investment is a leverage game and as such, it's advisable to be well capitalized so that you can weather the up and down of the market. A down market can last 6 to 8 years.

Re: The Rise Of The Million Dollar, One-Person Business

#65

Post by ww520 »

tunesmith wrote: post #40
simonreed wrote: post #37

Earlier quoted context omitted.

"What's left is real estate, but I'm regularly told I shouldn't even bother if I'm not a fix-it handyman sort, which I'm not." You don't need to do the fixing yourself... My advice would be to read 3+1 Plan book ( http://en.wikipedia.org/wiki/The_3%2B1_Plan ). You can get it for free in PDF from the author if you sing up for one of his websites.

Looks like the 3+1 Plan is basically to buy a property, pay interest only, wait for it to appreciate, remortgage, use proceeds to buy another property. I think I'm looking for more detail from a hacker perspective - how to get access to RMLS systems, mine the data, what kind of criteria to look for for best arbitrage, what kind of moves you can make if you have $x in capital, etc.

Here's my experience. If you don't have a lot time and not into construction and not a lot of money, don't bother going into foreclosure, flipping, or short term project. People going to court house auction bring in a million dollar cash to bid on foreclosures. They can keep bidding a house up until you run out of your reserve. It's very difficult to outbid them and still make a profitable flip.

For casual investor, the best approach is just buy and hold from the regular market, utilizing long term leverage to gain the profit. You want to buy into a trend and RE has very long trend. A rising tide lifts all boats. Doesn't matter which house you buy. It will go up in price in a uptrend. Also established neighborhood is easier to predict up and down. The whole neighborhood will go up in union. New development might turn out good or might turn out bad, depending on the people moving in.

For RMLS, the regular listings have a lot of information. The regular websites like Trulia or Ziprealty are good. Insider knowledge will not give much advantage because RE is a heavily regulated industry and once a house is listed, the agent has a duty to get the best price.

Re: The Rise Of The Million Dollar, One-Person Business

#66

Post by chii »

mhartl wrote: post #47

It's nice to see coverage of an exciting trend (of which I'm happy to be a part), but it always cracks me up when financial publications classify companies based on sales rather than profits. Defining a "million dollar company" as a company with a million dollars in annual sales is absurd.

my guess is they don't know the profit reliably?

Re: The Rise Of The Million Dollar, One-Person Business

#67

Post by yan »

reeses wrote: post #49
tunesmith wrote: post #33

I think about this a lot - I made the jump from salaried worker to self-employed programmer/freelancer/contractor/consultant (depending on how you look at it). But I'm doing enterprise-level architectural programming. It's not very amenable to productizing, so I'm basically stuck being paid for my time. What that means is that if I want to have a long-term high-security relationship with a couple of key clients, I ba…

First of all, f### "first-world problems" when it comes to something like this. It's personal and it's your life. You only get to perceive one run at this one. I posted a few things in Patrick's thread that I won't repeat here[1] regarding the move from a simple hourly rate to the ~$1m+ range. The thing I would work on in your case are your basic assumptions. I would try to get past the "long-term high-security relat…

Since I can't find a way to contact you, wanted to say: thanks for this.

Re: The Rise Of The Million Dollar, One-Person Business

#68

Post by ahi »

yogo wrote: post #5

> Many institutions in our society are still structured in such a way that W2 employees are considered the norm, and it is hard for even well-off people who are self employed to, for instance, get a mortgage without intense paperwork hassles. It was refreshing to read that. Even for an apartment it's almost foreign to most building managers when you say you are self-employed (they might even have an unwritten rule th…

This became an issue when I applied for a mortgage recently. I needed my father to cosign to make it go through. I make more than him, and I currently have 3 paying clients so I can't be more than 1/3 fired at a time, but apparently I am greater risk.

Re: The Rise Of The Million Dollar, One-Person Business

#69

Post by Spooky23 »

larrys wrote: post #30

One thing I will add to the discussion of someone running a 1 man "type" business (which would include both 1 man and 1 man plus some helpers part time, sub contractors, 1099's whatever) is that while the upside is capped the downside is also clipped. If you have a 15 to 40 person business with lots of overhead and you have a few bad years you can lose lots of money. Because of that overhead. But if you are running a…

Not necessarily.

Plenty of 1-man "professional services" businesses are functioning as middlemen between big companies, or big companies and government. They have low overhead, but usually have a fixed, immovable deadline for paying their downstream companies. As long as the good times roll and the customers pay in time, life is grand.

Re: The Rise Of The Million Dollar, One-Person Business

#70

Post by Spooky23 »

tunesmith wrote: post #40
simonreed wrote: post #37

Earlier quoted context omitted.

"What's left is real estate, but I'm regularly told I shouldn't even bother if I'm not a fix-it handyman sort, which I'm not." You don't need to do the fixing yourself... My advice would be to read 3+1 Plan book ( http://en.wikipedia.org/wiki/The_3%2B1_Plan ). You can get it for free in PDF from the author if you sing up for one of his websites.

Looks like the 3+1 Plan is basically to buy a property, pay interest only, wait for it to appreciate, remortgage, use proceeds to buy another property. I think I'm looking for more detail from a hacker perspective - how to get access to RMLS systems, mine the data, what kind of criteria to look for for best arbitrage, what kind of moves you can make if you have $x in capital, etc.

You're thinking about a scenario where you are carrying a hammer, and your looking for nails.

Real Estate is all about information. That information isn't in the MLS system.

Examples: How long is the old farmer by the interstate going to be around? What neighborhoods have weak neighborhood associations who won't protest my hacking a 2 family into a 4 family to maximize section-8 revenue?

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