Last week, I shared the Engine Model. It was a blueprint for designing an integrated life. I paused my regular workflow to write that post for myself as my trip transitions from a three-lane expressway of exploration to a local 2-lane highway. I like doing meta-writeups like that for the same reason I like reading others’ frameworks…it’s a form of “trail magic”.
The term “trail magic” was coined by long-distance hikers to describe an unexpected occurrence that lifts a hiker’s spirits and inspires awe or gratitude. “Trail magic” may be as simple as being offered a candy bar by a passing hiker or spotting an elusive species of wildlife.
For those on a similar journey, or see a similar juncture in their future, I hope the post can at least provoke if not be practical. One area I wish it was more practical, was on monetization. That’s a tough topic, so let me back up.
Reputation is the longest-duration asset you have. [The great grift of 2021 will forever be trapped in the amber of my mind as the moment a bunch of business-famous influencers decided the bid to sell their reputations was juicy enough to finally smack. It was a calculated bet on the shortness of your memory.] If you are not a sociopath, your ethical boundaries extend beyond the borders drawn by law. But the law alone seems to fence some people in just barely. Oh my god, fan me now. Watching literal lawmakers insider trade is an act of contortion so lithe it allows them to limbo even under that low bar.
Where was I? Oh yes, being an f’n normal human. So in that post I didn’t wade into specific monetization models because I don’t know much about them.
Instead, I address them in principle:
Once you begin thinking of your work as an engine, as self-integration, and not a single bilateral transaction with one employer (or overlord if you are especially cranky about your choices) you have replaced an existential problem, namely the rejection of over-compartmentalization, with a technical problem. The technical problem is “how do I sustain such a life?”
This is new to me and I’m learning on the fly so I’m not the best guide here. But I can offer my philosophical perspective, knowing that it will likely evolve with experience. I still think it’s important to lay out principles as a tether to your values as you head out into the unknown.
- Extract less value than you createThis is obvious. Strip-mining is not a renewable strategy. I’d rather underpromise and overdeliver. This isn’t altruism, it’s good business. If you leave the high-pressure race, you have chosen to focus on the long-term. The advantage is you can use a different playbook that relies more on compounding which pays off with time, instead of quick, but hard-to-repeat scores.
From Working For Free:
In business, I always enjoy the Costco example. Charlie Munger has written:
“When other companies find ways to save money, they turn it into profit. [Costco] passes it on to customers. It’s almost a religious duty. [They] sacrifice short-term profits for long-term success”.
It’s not as hokey as it sounds. Think of it this way. They are hiding profits in the customer’s own pockets. They will be return customers. That profit is hidden from competitors’ wandering eyes and the IRS. The strategy commits Costco to keeping the customers happy because the profit is realized over the long-term. It’s simple but requires rare discipline.
The profit that “sits in your client’s pockets” has a bookkeeping entry called “trust”. The fact that it doesn’t capitalize as an asset on your personal balance sheet is a shortcoming of accounting. You can’t let it fool you from the reality that you have stored your future income with your clients and in their word of mouth.
- Price your attention carefullyWhen you consider a project, you must decide how much to charge. If the project requires diesel fuel and you are a sports car, it might not run or it might be inefficient. This feels like a one-off transaction. You should probably quote a “go-away” price. At some price, you’ll suck it up. But this should be rare.
You want projects that have recyclable exhaust. If you suspect the exhaust is especially powerful, maybe you charge less. The point is to price your time or effort holistically. What is the first and second-order cost/benefit of taking on a particular project?
An example of holistic thinking: I don’t paywall my letter because the loss of subs would cut off a valuable inbound fuel source. The cash would not be worth it. Instead, I reframe the forgone income as “marketing cap-ex”.
I don’t know much about monetizing an integrated body of work. I’m not especially commercial-minded. But I have friends that are further ahead on this path that I can lean on. In thinking about creating your engine, realize you are not alone.
Identify your own principles. It’s a way to stay “green” as you experiment with sustainable business models that empower you to stay on the path.
In the past year, I’ve been approached by companies that want to sponsor this letter. Extra cash would make it easier to justify doing stuff like hiring a designer. I have some fairly irreverent ideas for Moontower swag that would be decidedly, umm, [lowers voice] befitting of the namesake?
So I was open to the idea. Especially since I will never paywall this letter. The only issue was most of the potential sponsors didn’t get me too excited. And the higher their bid, the less exciting they are. Go bumhunt somewhere else.
When I write to “find the others” I mean it. You make this effort worth it for me. You see, if I had to pick a single external metric to grade the body of work I’ve been calling Moontower, it would be the quality of its subs. By quality, I mean thoughtful people who care about getting better as co-passengers on this ferris wheel.
Out of respect to both you and me, I’ve been guarded about who I’d let get mindshare here. While I haven’t done a formal survey (I’m working on one though), I can tell this readership is smart and has many ultra-successful people within it. Almost all of you want to invest better and live better. You’re a pretty dream demographic to marketers. Fortunately, instead of me wrestling with which sponsors to match with, the answer landed in my lap.
My friends Jason Buck and Taylor Pearson asked me to sponsor the letter. They manage a fund of funds that comes from the “all-weather” style of investing. Many of you are familiar with that term because of Ray Dalio, but Bridgewater is to Kleenex as all-weather is to “permanent portfolios”. I have been invested in Jason and Taylor’s fund for nearly a year and I’m doing my own research now on how to be more hands-on transitioning my own portfolio to be more “permanent” 1. The exhaust of this research will be making its way into these letters so we can learn together.
In addition to the sponsorship and in keeping with my desire to keep this totally inclusive to everyone I have added the ability to be a patron of Moontower.
If you hit this button you will see the choices.
If you pay you don’t get any special posts, but if there were interest amongst patrons for higher levels of 2-way interaction I’d be happy to explore that.
There’s no pressure. It’s not like tipping in U.S. restaurants where it’s expected because servers don’t make a serious wage. I pay for about 20% of the publications I sub to. And it’s never about “is it worth it?” for me. It’s just, “do I want to support this?” I turned the feature on this week and there is seriously zero pressure. I already get a lot from your attention.
[For the more accounting curious…since I’m not a W2 employee and I incur expenses to run these sites and have a home office, any income I receive up until my costs are recouped is like an untaxed dollar. We aren’t talking real money, but eventually, I expect to have built a biz where I re-purpose a portfolio of solutions to my own problems so that it solves other people’s problems too. So these moves can be seen as practice with live rounds.]
By the way, a quick shout-out to my first paying sub, Max S., who signed up shortly after I turned that feature on. As soon as I get some swag made, I’ll be asking for your address man!