Entreporn, The Fallacy That Wastes Your Life

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Entreporn, a term brilliantly coined by Amy Hoy holds us back from our true potential.

It works to the advantage of almost every player in our industry that we “believe” in chasing the next big thing. They need us to keep chasing it. In the truest sense – the next big thing – is a carrot on a stick that keeps us occupied and keeps them in business.

I wish I could point the finger at one specific company, person, or party and say – it’s “their” fault – but there is no conspiracy here. It simply “is” because each player (VC, corporation, media) has become so good at optimizing their part – that the system as a whole keeps us distracted and chasing after a shimmer in the dessert .

It behooves the likes of Techcrunch, Time magazine and 60 Minutes that we care about Mark Zuckerberg’s outlier story because that’s how they sell advertising. It works out for VC’s that we keep chasing investment because that’s how they make their daily bread. It’s awesome for corporations that we chase very-unlikely-to-succeed break free strategies because then we don’t leave our job.

What they don’t publicize, and what they scoff at, is the concept of the “lifestyle business”. You’re lead to believe that it’s a waste of time, and in fact the category was recently derided by a VC talking to Mike Arrington as “dipshit companies”.

But here’s the truth.

If every developer was to focus on the very achievable goal of building a lifestyle/micro business – the entire house of cards would crumble.

And they know it.

The absolute truth is that each and every one of us can build a business that can support us. We don’t need to build a million dollar business to survive. We just need a regular paycheck. Just like the paycheck that we already get working for someone else, except it’s a paycheck we pay ourselves.

If you build a micro business it means you’re your own boss, you make your own rules, you live life on your own terms.

If you genuinely have the spirit of an entrepreneur inside of you, it’s perfectly possible to build a $10k/month webapp business that can set you free.

But even better, once you have the knowledge that comes along with building a succesful $10k/month business, you also possess the exact same knowledge that it takes to build a $100k/month business.

The chances of building a Google, YouTube or Facebook and scaling to the millions of users required to be “considered” for VC investment are vanishingly small. We’re talking in the region of 0.001%.

However the chances of building a $10k/month webapp business is pretty high. In truth, there is no reason to fail – other than failing to learn from your mistakes.

Imagine if we all did that. We would be free.

Update:

A lot of people have emailed me asking how to get started with this, so I’ve quickly put together the Bootstrappers’ Kickstarter Kit – No Investment Required

Comments

  • r o says:

    Thanks!

    Exactly what I need to hear every waking hour right now!

  • Bryan says:

    Very inspirational, thank you! Also worth reading is http://intermittentintelligence.com/2010/08/youre-a-developer-so-why-do-you-work-for-someone-else/

    Read this article again, then read that one, then go build something people want. Doesn’t have to be the next big thing – I totally agree.

  • Steve says:

    So, so, true. I’ve had to stop myself from searching for the next thing, that little thing that is just going to make my side project great, the thing to make it all easy. Already have the things I need: dev, skills, idea, market and yet I still look for something more when I should be just churning the code and shipping. Procrastination at its worst.

  • Very well said, Justin. Thanks for this post.

    The envious media is obsessed with billion dollar IPO “geniuses” when most people would be thrilled with $100k/year.

    The Internet offers the greatest democratization of opportunity in history.

    Let’s make it happen!

  • Edward Price says:

    This is the same rehashed message of common sense that everyone understands but few people are willing to say.
    It needs to be said over and over and over until the hackers. coders, mba kiddies, and hustlers get it stuck in the forefront of their minds.

    You know whats cooler than a million? Just doing something you love that gives you the income needed for the life style you want to live.

    Now if you’ll excuse me, I am heading to waikiki to surf for 6 months.

  • Karolis says:

    Excellent read and resonates with my thoughts well. There’s too much fashion, herd mentality and unachievable goals in this industry but there’s many realistic things if you look at it from the right angle.

  • Consultuning says:

    Absolute BS.

    For the sake of the argument, let’s suppose that only 10% of us have this “entrepeneur spirit”. Each of us is able to build a 10K/month small business, which makes 120K/year for each individual.

    Now, how many developers are in the world? Let’s be conservative. Assume that there are 10 million developers in the world. Does not sound like a big figure, I’m not counting the copy and paste monkeys but the people actually able to put together something usable.

    Hey, 10% of that 10MM will make together 120.000.000.000 per year!!!

    By your argument, there’s 120 billion of money somewhere that is waiting to be collected for someone. Of course that is on top of the existing players, unless those developers are going to build their products on top of something free of licensing costs.

    Your opinion sounds more like your dream, which in your case may be true. I’m not disputing that. But to hink that everybody can follow the same path is foolish.

    • Justin says:

      A lot more people can successfully follow the path I suggest than the alternative… It sounds like you’re taking exception to semantics… which is not really the point of what’s being said here.

      • Consultuning says:

        No, I’m not taking exceptions. Quite the opposite, I’m trying to expose that you’re trying to generalize something that perhaps is true for a selected portion of the population, perhaps including you.

        That idea motivates a lot of people to try. But the big, important point, is that not everyone achieves it. You’re painting a very pretty picture of what involves essentially a lot of hard work, perseverance, risk and -why not- sheer luck. You’re also right in that it is much likely to be easier to run a 10K month operation than for a 10MM month. And I also agree that people are aiming to reach the skies when really being able to be above the water is more than good enough.

        But the way of getting at it may have worked for you and a few more, but by no means will work for everyone.

        I think they call it capitalism. Your success has to come either from failure of others or the additional value you create.

        • Marco Rogers says:

          I think you miss the point of “inspiration”.

        • JC McCormick says:

          I think you’re being deliberately obtuse and disingenuous for the sake of proving your point. Or you place too much value in flimsy napkin math.

          This description you’ve given of revenue, wherein income is throttled by the overall availability of money as a ceilinged constant, is absurd. You seem to indicate that the 10k/month goal is insurmountable based on the premise that this fixed amount will never move, adjust, change, or flow.

          That’s not how money works. It redistributes and flows. A goal of 10k/month in revenue for anyone with the capability of an independent developer is not only mathematically believable, there is literally no math which can concretely disprove it.

          If there was, capitalism itself would have been disproven mathematically.

        • Chris says:

          Consultuning, see journalism.

    • jpk says:

      It’s not a zero-sum game. Profitable businesses create value.

      • Consultuning says:

        Profitability comes from getting more cash in than out. It can come from added value or simply be shifted from someone else’s pocket.

        • Josh says:

          Script kiddie here. And even I know money, and value, aren’t real. They can be, and are, created by entrepreneurs every day.

    • Matt says:

      I keep rereading this comment trying to make it make sense.

      Isn’t every huge company that emerges from out of nowhere and becomes highly valued collecting billions that were somewhere waiting to be collected?

      What’s the difference between individuals doing this (commonly called “creating value” and large organizations?

      • Consultuning says:

        “Isn’t every huge company that emerges from out of nowhere and becomes highly valued collecting billions that were somewhere waiting to be collected?”

        Yes, they are either creating something new that adds value (Google AdSense) or those billions come from someone else’s profits (Amazon)

        When someone does it on a small scale those causes are the same. However, the effects are not so big as when it happens on a big scale. Because you don’t read press comments about it, it does not mean that it happens.

        The difference is who absorbs the risk. A large organization generates a comparatively minimal revenue stream vs. a single individual. The large organization can afford to offset their loses with the benefits.

        The small individual either succeeds or burns.

    • Fred says:

      7 trillion was missing from the Federal Reserve. They can use that. :-)

    • Christopher Bruno says:

      This is the fallacy of composition.

      You are forgetting about supply and demand. If every developer started their own business, then the supply of solutions for industry X would increase, making it the return to such activity less (ie less than 10K/mo).

      I think the author is saying that given current market conditions, it makes more sense to focus on starting a lifestyle business where you can realistically make 10k/mo, instead of chasing the 0.0001% chance dream over at Hacker News.

      Obviously if every developer followed the path, the return to starting a business would fall. But since starting a business is a risky proposition, big or small, this isnt likely to happen.

  • John McMacerson says:

    >By your argument, there’s 120 billion of money somewhere that is waiting to be collected for someone. Of course that is on top of the existing players, unless those developers are going to build their products on top of something free of licensing costs.

    Well it is on top of and in the pocket of. The fact that ‘the big players’ are the ones currently milking the cow doesn’t mean that to succeed you must find another cow to milk. You can, but you can also just find a way that is better suited to some portion of the cows, convince the cows that your way is better and that they should pay you for it, and then rely on the massive inertia inherent in large corporate bureaucracies that prevent them from caring about / responding to challengers on small scales. 120k to Google is a rounding error, but to a developer it is a decent wage. If Google’s revenue goes down by 120k because some developer finds a way to ‘siphon’ off that business then there isn’t 120 billion of new revenue to be made, but there is 120 billion of revenue, or whatever number you want to choose for this discussion.

    • Consultuning says:

      Absolutely correct, and I’m not debating that point. My point is that simply there’s no room for everyone to do that, as the OP seems to imply.

      • Fred says:

        Obviously he is not arguing that we should all do it. But that those that can should consider it rather than focusing on VC or Angel funding. It is very possible to build a living wage through self effort. Many people do. To argue that one cannot or should not is to undermine your own position of focusing on a larger project.

  • Nice article Justin! I totally agree.

    Regarding @Consultuning’s comment, there is now way or no reason to try to quantify the grand total of money that is available for this type of pursuit. Also, why would the number of developers even be relevant as a starting point here. To me with business/personal/hobby exposure to a particular niche are the ones who could light that up with credibility and create an income for themselves. There are countless niches that are not served, undeserved or poorly served by existing companies. We would be surprised at how big a number this could all aggregate to if everyone with gumption surged ahead into these niches. Also to JPKs point, it’s clearly not zero sum. It gets bigger every day.

    • Consultuning says:

      The number of developers was a means to expose the flaw in the argument. You’re right, there are lots of niches that are waiting for someone to serve them and profit.

      What I don’t believe is that there is a niche for everyone.

      • Justin says:

        I just find your argument such a semantically moot point. There would never be a scenario where everyone did it. So why would anyone care about this impossible point?

        However for ANYONE who chooses to do it it WOULD possible for them to build a business.

        (Because of the very fact not everyone one will)

        • Consultuning says:

          Justin, maybe is a matter of interpretation. But I could not interpret “The absolute truth is that each and every one of us can build a business that can support us” in any other way.

          Seems a contradiction to say now “However for ANYONE who chooses to do it it WOULD possible for them to build a business. (Because of the very fact not everyone one will)”

          I’ve never challenged that some can do it. My challenge is that not everyone can do it. Which you seem to agree in the comment.

  • Thank you. I am about to start my own “lifestyle company” with a friend here in Switzerland and your words are very motivating!

  • Hillel says:

    Great post Justin. Here’s my contribution to the “lifestyle” business debate:

    http://www.jacksonfish.com/blog/2009/03/13/lifestyle-business-defined-in-under-140-chars/

  • Randall says:

    Sidenote- Arrington wasn’t referring to lifestyle businesses as dipshit companies… he was referring to features not companies- the companies who get a lot of users with no proper prospect for a business model.

  • Duff says:

    “Imagine if we all did that. We would be free.”

    Hmm, more like we’d have an even more competitive market for small web businesses. I’m cool with that, and I think it is a good thing even. But it’s more like 1:1000 would be free instead of 1:million with the “sell to/become the next Google” strategy.

    For us ALL to be free, we’d have to radically restructure the economic system to be more equitable, not simply work within the rules that favor the most wealthy and powerful.

    • Justin says:

      Agreed. We could never ALL be free at the same time, but we ALL have the possibility to be free. See my comments about the semantic aspects of this argument (above) :)

      However I do acknowledge that I said “imagine if we all did that” so I can see why this point has come up a few times.

      • Fred says:

        I don’t agree with the second ALL statement. Maybe the correct statement should be: Where ALL have access to the possibility to be free. I know some pretty amazing developers in third world countries and they struggle. The frame work is also necessary. But for most people reading this blog, I would expect they are ALL capable.

        • Justin says:

          Can they learn? Can they be capable one day down the road…?

          Do you know ANYONE who will NEVER be capable?

          Isn’t that the same as saying ALL! :)

  • Mark says:

    $120,000 annual salary when you work for yourself is like $85,000 – $90,000 when working for some company. That is what you actually cost the company, with payroll taxes and benefits, etc., rolled in.

    You don’t think the top 10% of developers in the U.S. are making that much or more in salary? So, the top 10% of developers moving from a company to, say, consulting, for their former employers creates this $120 billion situation you are describing. No new capital created from thin air, just shifting who pays the taxes, insurance, etc.

    Not much of a stretch, really. Ease up on the hyperbole.

    • Consultuning says:

      The hyperbole was trying to highlight the lack of realism on the proposition. And your arguments support it. Yes, there are a few individuals who could do it. No, everyone cannot do it.

      Again, let me repeat, your income comes from either new value created, or from income taken from someone else.

      The whole thing sounds to me like the opinion from someone who is in a rather good environment, one where he can actually think that everyone is talented enough, has his/her own priorities set to do that, and knows a market where this opportunity waits for being exploited.

      Under those conditions, perhaps you can take advantage of the opportunity. Those conditions do not happen everywhere and for everyone. Simple as that.

  • The decision to quit my job before my ‘startup’ generates revenue might have been the dumbest move in my career (according to family members), but I must say — the past 8 months have been a lot of fun!

    I agree we should all strive to earn a living and then shoot for the stars, but, quite frankly, I didn’t quit my job and risk my career to ‘just make it’. Maybe it’s just me being young (relative) and naive, but I say forget about the few K per month… go for the big B! Though in my case… maybe the big K :)

    • Justin says:

      As with any industry there are always rock stars. We have Peldi, Patrick Mckenzie, and maybe.. you :)

  • Will says:

    I like where your heads at but – unfortunately – I’ve already bought into the hype ;) It’s good that you’re pushing this point though, and it’s also interesting to think about the larger implications of large, dynamic systems of people and institutions. Just like you said, it’s not one person but several large and varied groups w/ differing prioritie. May seem like they’re working towards their own but they are also slowly but surely reinforcing the overall patterns of the sytem. Interesting to realize that groupthink exists even in this ecosystem, supposedly so full of brilliance and innovation. Also, ain’t nothin’ wrong with a 10k a month business :)

  • James M says:

    Thanks for introducing me to the term entreporn. Great term!

    I’m starting out my consulting business with the aim of making $5,000/month by the end of the year. Not the 10k, but it’s a good building block to start with.

    Thanks for some great ideas.

  • Paul says:

    To each their own I guess. I’m in the very early stages of building myself just such a thing, the objective being to support my wife and myself comfortably, with sufficient enough funds to enjoy ourselves. Millions would be great, but I’m the kind of guy who is happier on a superbike than in a supercar costing 10 times as much. Booking marking this post for later inspiration.

  • UncleSam says:

    Awesome article.

  • Shibu says:

    Yeah,
    if every one interested in music would start a rock band, all of them can be rock stars, earning millions!!!

    • Justin says:

      I’m so glad you made that comparison, because I was in a band, and it IS perfectly possible for any band to become a working band that plays bars to earn the bills. That’s exactly how the Beatles started.

    • Wladimir says:

      Probably not a rockstar earning millions. That would be chasing the rare glimmer in the desert, as to use the phrasing from the article. But I guess a decent musician could earn enough to pay for his living expenses. That’d be a better comparison.

  • DavidK says:

    You haven’t really got the definition for entreporn down here and I searched Amy Hoy’s site and couldn’t see it there either. I understand what you’re getting at, but for me to be able to explain the concept in an elevator pitch environment perhaps you’d care to offer a dictionary style definition or your understanding to help out? I certainly would appreciate it.

  • Jason Gorman says:

    I’d go further and say the media actively encourages unrealistic expectations across the board. X Factor, for example, leads kids to believe being a popstar is a career choice, as opposed to the extremely unlikely pipe dream that it really is. So instead of buying a violin and practicing, or learning to write beautiful music, they just focus on “getting famous” for it’s own sake.

    Worst of all are the lottery winners (you may know them as “business gurus”) who try to kid us all they have the secret to winning the lottery, and con millions into paying good money to find out out what the secret is. The secret is that there is no secret. It’s 99.9999% blind luck.

  • Knocking on the Door says:

    There’s probably a bunch of me out there with this problem:

    - got the skills
    - got the motivation
    - got the couple of hours a night spare
    - enjoy programming projects at home

    - Don’t have any idea what to make

    I’ve been making small things on the side for years to keep up with the latest technologies, trends, etc. But I have no idea what to make. Every idea I come up with is too hard for one person, or doesn’t have a monetization strategy.

  • Peter says:

    Just a comment from someone who switched to consulting. It is just as hard to get a $3k/month gig as it is to get a $10k/month gig. It’s a bit different but if you can sit down and figure out one, you can probably do the other.

    The VC thing is also overrated. First, you need to shoot for the moon to get them interested. Then, if you take their money, they own you. So many times I’ve seen or heard of founders getting edged out so the VCs can get their man in. Forget that.

  • The only comment i will make is the whole quote in the Arrington article is:

    “The VCs, for their part, fight back more quietly. They point out that very few angel funded startups end up very big or interesting. “An entire generation of entrepreneurs are building dipshit companies and hoping that they sell to Google for $25 million,” lamented a venture capitalist to me recently.”

    IMO, the VC was not talking about lifestyle companies at all. A lifestyle company makes money, sometime a lot of it compared to the number of employees. The ‘dipshit’ companies selling to google for 25 million are almost always not making any money and have no plans or intent to ever make money.

    I believe those are the companies the VC was talking about. Those are not lifestyle companies and I tend to agree with him. I think most of those kind of companies are pretty lame.

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