Thursday, March 20, 2014

Key Indicators

Something happened to me yesterday that just about never happens -- I was supposed to be somewhere, and I wasn't there. By now, I've already been through all the stages...and I'm comfortable enough about what happened to be able to write about it here. I apologized to the person that I stood up -- while being careful not to overdo it -- and the screw-up has basically been contained.

Business Lesson #1: There's no such thing as error-free baseball, so don't try to play it. When errors DO happen, stay classy, take ownership, dust yourself off, and move on.

A few hours later, one of the students I tutor sent me an e-mail canceling a session for tomorrow due to a bad cold she was experiencing. I shot back a quick "no prob, get well soon" e-mail, but didn't mention in my note that I had no clue that we were slated to meet in the first place! Twice in one day is no coincidence. Things will slow down quite a bit after May 15, when I finish school (for REAL this time).

One thing I want to be a bit more thoughtful about when the post-May 15 era arrives is how to more intelligently account for the way I spend my time to earn money. Here are 8 quick thoughts that speak to that:

1. I am a bootstrapping entrepreneur. ('Bootstrapping' gets defined different ways, but to me it just means 'no outside equity financing').

2. I have de-risked the process by taking on side jobs that bring me over my monthly 'hurdle' rate.

3. This has been so effective that even after graduation -- and even after the loan payments kick in -- I will be able to plow most of the revenue from the business back into the business itself.

4. Some means of revenue generation are far better than others...and the per-hour wage associated with each can be very misleading.

5. Hours that "stack" are worth significantly more than hours that don't. For instance, my tutoring job pays 5x the hourly wage of being an Army Reservist...but if I had to give up one position, it'd be the tutoring, hands down. The Army wage is easier to account for (it's quite predictable), and the consecutive hours swallow up the overhead 'costs' associated with travel and preparation.

6. Making 80 bucks an hour to teach Calculus isn't really what it sounds like. If there's a travel hour on each end, 4 prep hours per session (remember, I was never a true Math guy), and then awkward time gaps built in due to the unusual scheduling, that dollar figure starts to shrink, quickly.

7. Adjuncting is the best gig that I have's 3 hours in a shot, I don't have to do a ton of grading, and the prep time will amortize nicely with each subsequent course iteration. If I can score a couple more simultaneous gigs in this field, I would be able to clear my entire hurdle w/this alone.

8. Cost accounting is incredibly tricky and subjective (I'm actually taking an entire course on the subject right now, and it's a doozy). Revenue accounting gets funky, too.

Have I crossed the line into "Dear Diary" territory here? Maybe. But hopefully some of these entries can be useful someday to some other bootstrapper trying to figure this stuff out.


C R Krieger said...

Writing it down is useful.

Regards  —  Cliff

The New Englander said...

It is. There is something nice about putting thoughts down on the blog. Helps to crystallize thoughts, too..