One thing most ppl don't realize about starting a small biz:
Say you have $16k and need $2k/mo to live on. That's 8mo runway.
Say that after 3mo, biz makes $1k/mo. Not sustainable yet, but now you have 10mo runway! ((16-2*3)/(2-1)=10)
Not-enough revenue is still real money 🤑
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Huh. "runway" is actually backwards metaphor for this thing, at least in a personal context (may be diff with "moon or bust" startups)
Real runway is fixed distance, & certain speed needed for takeoff, but faster you go the SOONER you run out of runway! 🛫 All-or-nothing.
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By contrast, as you get momentum going with a personal business, that actually buys you *more* time.
I supplemented myself with a couple of 1-on-1 coaching clients during the early phase when was only making me ~$300/mo. But that $300/mo was still vital!
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I'm now trying to design a better metaphor than "runway".
"bootstrapping" gets part of it tho is also weird since literally pulling yourself up by your own bootstraps is impossible.
"bootstrapping" also doesn't afford the Q "how much runway do you have?"
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Metaphor Design has become a really vital concept for me lately.
Read my latest writing on it: roamresearch.com/#/app/malcolmo
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"Mana", a game metaphor particularly from the MTG card game, captures some other elements. But doesn't capture the natural running-out-ness of the resource.
Huh. "Slack" is kind of the thing, not with literal rope but in a systems sense.
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Speaking of systems, I'm thinking about how slack in systems often takes the form of buffers.
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Leverage Point 11: sizes of buffers & other stabilizing stocks, relative to their flows
eg difference between
a lake (mostly buffer)
a river (mostly flow)
More buffer usually means more stability & margin-for-error, but can be costly & less agile. Often hard to change.
a lake (mostly buffer)
a river (mostly flow)
More buffer usually means more stability & margin-for-error, but can be costly & less agile. Often hard to change.Show this thread
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Fuckit I am really tempted to just call this "runway"/"slack"/etc thing "upward spiral juice". Upward spiral juice is fuel for upward spirals, and if used effectively generates more of itself.
Okay, now what is that? That's a "seed":
Plant, water, wait→moar seed.
🥜🌱🚿⏳ → 🥜
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"Seed capital" is a phrase. Maybe we can make it richer.
There are some concepts of "don't eat your seedcorn" but ultimately if you're starting a 1-person business then your own need to eat is actually a major thing you'll need to invest your seed capital into! 🙃
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This resonates. I've been really surprised by the impact of Patreon, how it's forced me to rethink my models of funding software development. I'm in the red, of course, but Patreon now covers half my monthly burn, which greatly extends my timeline, which enables yet more growth…
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Mmm, yeah! And there's a kind of nonlinear threshold thing, where as Revenue approaches Expenses, timeline goes to infinity.
Given {$1000/mo expenses, $1000 capital}
$800/mo rev = 5mo
$900/mo rev = 10mo
$950/mo rev = 20mo = 1.7y
$990/mo rev = 100mo = 8y
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Which is to say, doubling your timeline a second time only requires 50% more growth (0.5→0.75).
A third doubling then only requires (16% more growth (0.75→0.875).
Fourth doubling 7%, fifth doubling 3%. And meanwhile growth itself may be compounding.
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