January 5, 2012
It is said that time is money. This is particularly true for a for a cash-starved, resource-restricted, high-growth startup rocket. Yet typically, startup CEOs don’t have a grasp on the value of their time. So let’s do the math together.
Let’s start by placing a value on your time. You are a hyper-driven CEO. You work 60 hours a week and take no vacations. You are building a company and you want your share to be worth $10 million in 5 years. That means you’re working 3,120 hours a year. By year 5, you’ve invested 15,600 hours in your company. $10 million divided by 15,600 translates to an hourly rate of $640 dollars an hour.
That’s like almost-real money. For $640, you could probably get yourself one of those snappy iPad thingies. That $640 doesn’t take into account any salary or distributions you’re taking out of the business. So let me ask you a question: Would you ask your $600-an-hour lawyer to file paperwork? Would you ask her to make cold calls and set up appointments for you? Would you pay someone $600 per hour to sign 20 checks a month with a total value of $2,000?
Here are 5 questions you should ask yourself during your work day:
- Is there someone else who should be doing what I’m doing right now?
- Is what I’m doing right now worth $600 per hour? What would it cost me to get someone else to do this?
- Is there something else I should be doing that only I can do?
- Are customers and employees getting angry at me because I’m not responding to their requests in a timely fashion? Should they be depending on me?
- Am I doing what I’m doing right now because I’m avoiding doing another a higher value activity that I hate – but have to do anyway?
Make it a habit of thinking about these questions as you go about your day. If you value your time, honestly answering these questions will change your habits, help you better manage your time, and even increase your value.
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