Nope and I never would gripe about it! Life is just way too short to have such a stressful job. Just be be clear, I’m not knocking the other guys choice, and sorry if it appeared that I was. It’s just that for me it would not be a good fit. Earning my living from flying while still a job, is one that I can be happy with...on most days at least.

Or you can hire a manager for $200K and a helper for $100K, and net $200k for doing almost nothing.

Or bank $200K for ten years, that's $2M, and then live off the interest/capital gains (5% = $100K).

"For doing almost nothing" -- hah, as if that were possible as a business owner. If you've owned a business, you'll know that no matter how many people you hire, the buck always -- always -- stops with you.

What's also missing from your calculation is the risk you take, personally, as a business owner, for anything that happens during the course of business. Sure, we have business insurance -- which ain't cheap -- and I have an umbrella liability coverage on my personal assets. Corporate veils can always be pierced by a lawyer who's determined enough. I think what people miss when they talk about business owners is how much personal risk they're exposing themselves to.

As for your investment calculation: 1) A guaranteed 5% pretax return would be a strong performance. Where do I sign up? And 2) you're neglecting the effect of income taxes on that $100K. A $2M nest egg, IF it yields you reliable 5% returns, will put perhaps $65-$70K/yr, after taxes, in your pocket, if that's your only income.

Sure. Of course, by posting this I'm pretty much revealing my identity to everyone at my airline, but whatever -- it doesn't matter. I run an advertising and design creative agency. The strong points of that industry are that you literally have to invest almost nothing upfront. You just need office equipment (laptops, monitors, and of course an espresso machine!) Everything else is a recurring monthly expense, like office rent or labor compensation, that can scale up and down with your business, to an extent. All of your 'assets' are the ideas and talent in the people you hire.

The downside? It's a very cyclical business, like the airline industry. When recessions hit, the first thing clients cut is their marketing/ advertising budgets. And, it's a very demanding and time-sensitive industry with clients who think nothing of texting you at 9 am on a Sunday asking if you can meet that evening to discuss changes to some ad you just released.

The other downside is that it's quite a high-priced labor market. I'd say the average comp for someone with maybe 8 years' experience is around $180K, and to that you have to add unemployment insurance, worker's comp, paid time off, healthcare, etc etc. Figure a total cost to the company of perhaps $210K for someone in their late 20s/ early 30s. That goes up significantly from there. Our payroll right now is about $550K/month. (That's not a typo, It really is north of half a million per month.) And that's not counting office rent, Internet, computer supplies, travel costs, employee lunches/ snacks, accountant, legal fees, business liability insurance, errors and omissions insurance, and about 1000 other things I'm forgetting right now.

And finally, it's a very, very, VERY hard industry to break into. I worked at global advertising agencies for 20 years before I gained the experience and business contacts to get to the point where I felt able to start my own. For fhe first year it was just me and my fellow co-founder, working at our kitchen tables. Then we landed some key projects and it just took off from there. Now we're 40 people. We were 45 a few weeks ago but we had to let 5 go, which felt like a knife to the heart.

I'll tell you this, though., I would MUCH rather have one job: airline pilot. It is so, so, so, SO much easier and more enjoyable. Well, most of the time.

You're doing a 12% cap rate on a property? That's incredible. Are you including price appreciation in that?

We're at 5.5% on two properties in PHX with no financing. Searched for 6 months across multiple markets and never saw anything close to 8%, let alone 12%. Now, if I looked at the total return rate including price appreciation and rental income for my third property in CA, it's averaged 15% every year for the past 9 years. But that's only due to the ludicrous price appreciation (more than 100%) over the last 9 years. If I only looked at cash flow, it's more like a 3% ROI.

Which, of course, is still better than the 30% destruction that's happened in the markets these past weeks.

Lesson learned. I should have just blown it all on women, gambling, and alcohol. I mean, seriously. I would be poorer but happier ;-)

That's why I didn't go cheap on management... if I'm paying someone $200K (pay and bennies), and providing support staff for the manager, I would expect not to get bothered much. That's the point. A weekly or even daily written SITREP, maybe a weekly call. Interruptions only for very urgent emergencies which require some action on my part (need to delegate some authorities to the manager). Have to dampen your inner control freak.

This assumes you don't have grand aspirations for expansion into new arenas, just growing in the niche and making money. If you want to take over the world, yeah gonna have to do that yourself.

I know all about it, BTDT, have the umbrella.

I would argue the risk is not insurmountable, I would not do ANY extracurricular business if the fruits of my and my wife's W2's were also on the line.

IF you're careless, a lawyer might pierce the veil. Have to be pretty disciplined if you expect it to hold up, but that's the nature of business.

Probably the most common way to screw it up is by mingling business and personal stuff early on in the life of the business... may be hard to ever undo that. Best to start clean from day one, rather than working out of your garage and personal checking account.



I was comparing gross to gross (based on his $60K gross regional salary). Of course I know you have to pay taxes, and so does a regional FO.

My personal investments, on long-term average, have exceeded 5% annual. I was using 5% as a conservative value for the long haul. The Dow on average does close to 8% (long term).

Very inspiring, thank you. I don’t know if I’ll ever scale up to that level but it’s something to strive for.

You made this same thread a few weeks ago. Why are you so concerned about this topic?

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I think it depends on the type of business. I fly with a CA who has a dry-cleaning shop; he operates it mostly as you describe. But in my industry, cliients demand high-touch contact from the agency founders. I work pretty much 13-14 hours/day and a great deal of that is one-on-one or one-on-few interactions with senior clients at Fortune 50 companies. There's literally nobody else at my company who could play that role. Replacing myself in my own job is one of my top priorities but it will be a long search.​

​​​​​​Yup. But in this business, if you don't expand, you die. Clients always want to hear about the new clients you just won. It adds to your perceived value.


True on all fronts. In most cases, good corporate insurance, plus umbrella coverage and a disciplined separation of assets will protect most businesses against most potential suits. But there are certain areas, like California employment law -- ask me how I know -- where one disgruntled person can cost you tens of thousands in legal fees and years of investigation, even if (as happened to us() you are found to have acted appropriately and the case is dismissed.

Like I said. I should have blown it all on girls, gambling, and gin.

Well, if you have the spark, then go for it. Nothing ventured, nothing gained ;)