As the new year starts we all set goals and have ambitions to make it a year to remember – as we should. But sometimes we need simple philosophical shifts too. Small shifts that can have a dramatic impact. One of mine is to ‘value myself appropriately’. As startup entrepreneurs an important part of the process is to be a bootstrapper, to maximise the limited resources we have to gain the momentum we need. This often leads us to doing it all ourselves. To be our own courier, printer, door knocker, community manager, clerk, mail room assistant…. anything and everything which is possible to do ourselves. And this is one of the greatest false economies in startup land. A simple rule to circumvent such folly is this:
Never do a task which can be outsourced at a lower hourly rate than what the open market would pay you for that hour.
While it’s easy to argue that we aren’t actually paying ourselves the market rate, it is certainly true that we should be creating the value of our market rate. And this is usually at least double the pay rate. Hence a person earning $100 per hour, should be generating at least $200 per hour for their organisation. Every hour wasted doing a menial task, has more impact than we actually think. Let’s take this simple example:
If we work 60 hours a week for 50 weeks for 2 years and end up with an equity stake valued at $3 million our hourly rate comes out at $500.
Which doesn’t leave many tasks that are worth doing ourselves. Startup blog says value yourself in 2013!