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5 Things I learned from being rich and losing it all
I once had enough money to do whatever I wanted thanks to a successful start-up. Sadly, like most lottery winners, I was unprepared for this and mismanaged my new-found wealth.
This is what I learned from being rich for a little while:
1. I can get rich.
I think one of the biggest things holding people back from getting rich is the belief that it is possible. I did it once, getting past this roadblock by finding mentors to guide and inspire me. I will do it again soon, better, and with more ease, simply because I know I can do it.
2. Success begets dangerous opportunities.
When you do well, suddenly a lot of doors open up to you. May I humbly suggest that you ignore them unless they are directly part of your plan. Otherwise, you may find yourself distracted, spread too thin, and losing ground. Related, I suggest flushing out fully everything to do with what made you successful in the first place before moving on to something else. There probably are other ways to take what you’ve done to greater success, riding on the wave you’ve started instead of starting a new wave from scratch.
3. Money does buy you happiness.
To all the people who say otherwise, I say hogwash. There was a dramatic change in my personality when I had money. A tremendous weight was lifted when I suddenly went from a low income to (apparent) financial security. In a society ruled by money, no longer having to worry about money is something very worthwhile that money can buy. (Note: I know very happy people with no money, living off the grid. Money is not the only route to financial security!)
4. Stuff does not buy you happiness.
There is an image that our society as a whole seems to subscribe to of what it means to be rich, and a good part of that image is attached to buying stuff. With a lack of a different role model, I found myself subscribing to that belief system, even as I questioned why the heck I needed these things.
Next time I’m rich I’m not going to attempt to fill holes in my life by purchasing stuff. I’m going to use the money to do good and live a more extraordinary life, defined by what I do and experience, not what I own. Stuff just ties you down and forces you to make yet more money. You can be rich with a lot less money if you stop buying lots of stuff!
Very inspiring quick read: 10 Unexpected Costs Of Owing Things
[As an aside: It seems almost a right of passage with many Internet entrepreneurs to buy a really expensive car. Why? Why? Why? If I really wanted to spend that kind of cash on myself, I would get a full-time personal chef. Now that's a luxury!]
5. It’s important to know why you want to be rich.
Money is a means to an end, not the end in of itself. With the pace expected of Internet entrepreneurs, the means tends to become all consuming, and when the money comes, I think many people forget what the point of it all was and continue doing what they were doing, just on grander scales. That’s what I did. I squandered the freedom of being able to do whatever I want, and it took (temporarily) losing the option to allow me to discover what I really want to be doing with my life.
I’m actually glad that I have had this experience of gaining and losing wealth. It has given me more balance to my life now. It has also prepared me to gain wealth again, keep it, and live my life in a much more intentional way doing things that really make me happy.
By the way, in future posts I will write about all the things I did right and wrong in my start-up, and the lessons I learned in the process.
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August 13th, 2008 at 5:23 pm
Just wanted to say that this was a very interesting read and thanks for sharing it. I’d love to hear more about the mistakes you made after the startup.
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August 13th, 2008 at 5:45 pm
How did you squander your wealth?
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August 13th, 2008 at 5:57 pm
What was your previous startup? Which purchase was your biggest regret?
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August 13th, 2008 at 6:26 pm
So what was your net worth and how did you lose it?
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August 13th, 2008 at 7:46 pm
Hi John,
When I read your post, it reminded me of what I had heard/learned from listening to “The Four-Hour Work Week”. The author, Timothy Ferris, speaks about similar situations that he’s had and how he changed the structure of his life so he could enjoy the finer things that life has to offer. As an entrepreneur, I’m sure you’ve already read or listened to this book, but if not, it’s definitely worth a listen to.
Scott
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August 13th, 2008 at 8:55 pm
I see wealth as buying me independence.My first startup was acquired and while it hasn’t made me insanely rich, I can be independent enough to think about another startup without worrying about making ends meet. It’s not about acquiring things, as you say, but it is surprising the number of people who seem to have actually taken offense that I didn’t run out and buy a sports car or a 5000 sq. foot home.
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August 14th, 2008 at 1:44 am
I want to be rich not only for me, but also for other happiness.
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August 14th, 2008 at 6:41 am
“Stuff does not buy you happiness.”
Nonsense. To quote someone who has a firmer grasp on reality (than you), “Have you ever tried to frown on a Jet Ski?”. Not knowing what you want or how to get it, makes people unhappy. Getting what you want, makes anyone happy.
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August 14th, 2008 at 7:37 am
I had this moment of clarity recently about how 6 figures really doesn’t mean much. i just graduated and it kind of just happened… big company doesn’t get the net.. I do = payday. But I’m not smiling and people who say “you make mad loot cheer up” well put simply they don’t and probably never will. and @Jack9 ^^ that includes you.
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August 17th, 2008 at 8:22 am
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September 9th, 2008 at 2:18 pm
John -
As someone who uses GTT with great success - and occassionally checks in to see what kind of progress is coming with future incarnations - found this post to be a nice breath of fresh air and think it’s well worth commending..:-) It’s the adventure that’s important - and if you hit the jackpot with 5 more “launches” and lose it again - it just makes the ride all the more interesting to boot. There is nothing worse than looking at the blank and boring gaze of the masses of middle aged mental midgets walking around with wallets stuffed with cash - I’ll take the bohemian ride up (and down) for the sheer fun of it all every time.
Best..:-)
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September 9th, 2008 at 5:44 pm
I totally agree with the statement where you say it’s hogwash that money does not buy happiness. The stress of not having money is like being in survival mode where your brain is always focusing on making some. When that stress is gone you go back to just being and doing for the most part and just being and doing is happiness.
Good luck with going raw let me know hwo it goes.
Micah
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September 14th, 2008 at 1:29 pm
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September 15th, 2008 at 7:42 am
So you say you were rich? Prove it or shut up.
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September 15th, 2008 at 8:14 am
(1) If you had acquired some well thought out investments property or assets you may have kept some of the wealth more easily (the trap and the promise) and (2) the same lesson (true independence) in many ways can be (from my experience) learned from starting over with nothing. Just realizing it can be done, because if you can do it once - you can do it again. Hence, no fear of losing.
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October 6th, 2008 at 8:50 pm
Hi John,
What a wonderful post. I have always admired your candor and approachability, especially refreshing in a successful Internet Entrepreneur
Thanks for sharing your experience.
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