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+1 for rob walling. I read his book start small stay small a few years ago and it totally changed my strategy on how to build a business. I've gone the multiple apps route and on track to gross over 500k this year. And all the while I've travelled the world for 7 months and rarely spend more than 30 hrs a week on work. I have a few friends that went through YC and I wouldn't trade places with them for a second. Maybe I'm just lazy but working 80 hour weeks just for a shot at a large exit just isn't for me. Without rob's book I would never have known there was an alternative path.

I'm reading this book just now and came to HN to see if people were talking about it :)

Curious: are you also outsourcing small tasks? (I'm in that page of the book)

For me, $5k/month won't be able to do it. It's good enough if it's a salary, but a job also includes other things such as health insurance, 401K, and intangibles such as social contact with other human beings. So for me, the amount would have to 3 times my normal annual salary.

I currently make $7K a month with 10 minutes of work a month (creating a newsletter), so I agree - the path to residual income is much easier than creating a startup. But it definitely doesn't feel like I can quit my job anytime.

Yep, the figure is going to vary person to person. For example, I'm married and my wife brings in an income and will be able to provide health insurance once I jump ship, so that number is lower for me than it would be for someone without that additional income.

My point though is that for every person there is a monthly mostly-passive income which, if achieved, would let them live a similar lifestyle as being part of a multimillion dollar acquisition. And it's a hell of a lot easier to reach.

Do you think it's easier for you to make $5K/month passively or make $5M from a acquisition? $10K? $20K?

Edited to add: Why not invest more time into your newsletter so that you can leave your job? If you truly invest 10 minutes per month and believe that there's still room for growth, why not spend more time getting it to the point where it does cover your health insurance and 401K? Or if there's minimal room for growth why not try to replicate it? Or does the money not even matter: do you want to stay with your day job because it gives you purpose and socialization? Your situation is fascinating and I'd love to hear more about how you got to where you are.

I got > 90% of the subscribers from SEO over the course of 2 years. The growth rate of those subscribers has dwindled ever since my sites got punished by Google Panda.

For those curious, the newsletter has to do with a very niche product that people usually order every single month. I'm simply an affiliate and write a newsletter with tips for that product along with a coupon code.

The affiliate program is pretty friendly as I get paid a commission every month even if I don't get them a new customer (but get an existing customer to order it through my link).

Thanks for the details. How much do you get paid if you get no sales? How much extra on average per sale?

If I get no sales, I get paid $0 since it's pay per performance. I usually get $40 as commission per sale.

Nice. What's the story there, if I may ask?

did I read it right that you spend 10 minutes making a newsletter every month and get $7k for doing it?

This works once you have created your own list. I do something similar. There is not only the programmers way but also the marketers way.

this only makes sense if its recurring income(i.e. subscriptions) and if you aren't depending on any other service for that income.

if your $5K/mo comes mostly from Google traffic you can lose everything overnight.

i.e. I have a friend who had an affiliate site that was generating $20K/mo. Then the Google Panda update happened, and that went down to $1K overnight(well it took a few weeks). Last month that site generated a whopping $24 in revenue.

Google tends to be the biggest threat here.

Traffic? Can't lose out in Google search results.

Ad Revenue? Can't get banned from adsense(impossible...since all it takes is a competitor clicking a bunch of times on your ads)

Paid Traffic? Can't get banned from adwords...which can change their policies at any time.

Payments? Can't get banned by PayPal.

Basically what I'm trying to say, is that there is a TON of risk. And you need a huge cushion to feel comfortable. Personally I'd want a $30K/mo income in order to have a $4-5K/mo lifestyle...just to be on the safe side. To at least avoid the stress...that everything can be lost overnight.

That's why these big payouts should be preferable...since then there is no more risk(short of losing it all in financial crash)

I'd argue there are even bigger risks in swinging for the fences which is almost by definition a low probability/high reward endeavor. You might not have to rely on the impact of a Google algorithm change as much, but you've now got to worry about a host of other issues: cofounder problems, hiring employees, raising money, running out of money, dealing with well-funded competitors, etc etc etc. There's risk in both paths.

As an aside, this why I like diversifying my portfolio (ie, I'd rather have five apps making $1K/month than one making $5K). There are downsides to this path too, but I think it's a decent way to minimize the risk if you want to do this professionally long term (as I do) and are not relying on an acquisition.

Just because you have income without a lot of effort does not mean you have a sustainable company. Granted, you don't have to make 30k a month for all that long to get to years of living expenses in the bank.

If you really want a lifestyle business you need to be able to survive even if you have to pay for advertising. As to ad-words, there are plenty of forms of non Google advertising out there. If your site is so dependent on new search engine traffic it can lose 98% of it's visitors from a few changes in Google's algorithm you have not created value your just doing arbitration. Arbitration opportunities are always short lived, that's not to say they are not worth perusing, but don't think they are anything but a quick windfall.

From the other side, just because you have put in a lot of effort that does not mean you have a sustainable company either, however, your moat might be slightly wider, should you hit the right market.

There is risk, but that's why you lessen it by diversifying your traffic streams, and even your income streams. I own multiple software products and web apps; if any of them tanks I still have more than I need to live on. Actually, at this point, more than one could totally disappear and I would be ok financially.

The odds of you selling out and making $5M are ridiculously lower, and I mean hundreds or thousands of times lower, than making a few small apps that generate a full-time income.