Investing in yourself

After having recently hired an employee, built GoFind!, and now having started Duarlander, a few people have asked me exactly why I'm spending the money to do all this - especially given the state of the economy. I figured I'd use this as an opportunity to share a little about my perspective on a few things as it relates to investing, risk, and the overall economy.

First, the money I'm spending on these initiatives are investments in either Ideal Project Group or Duarlander. It's not like I'm spending money taking friends out to dinner or blowing it on liquor.

Second, while it's certainly not cheap to do these things, relative to the potential reward the risk is pretty small. I've said numerous times, if building GoFind! helps Ideal Project Group get into managing software projects for hand-held devices, it's paid for itself even if I don't sell a single download.

Third and probably most importantly, the stock market is now nothing more than a national casino. It is no longer a place to invest, it's a place to gamble. Some people are good at gambling; I however, am not. And just like a casino, the house always wins and they don't really care what happens to you. Giving your money to a 401(k) manager is no different than funding a poker player and sending them to Vegas. In fact, there's probably some poker players that your money would be safer with.

Fourth, a lot of companies lie about their earnings and their assets. Citibank can say they're profitable because they're now allowed to lie about how much their assets are worth. Hey, guess what, you know all those phones I had to buy for Duarlander? I've decided they're each worth $100,000. Duarlander is a $700,000 company and it hasn't even been around a month, isn't that awesome! Give me a break.

What this all means is that the money I might have otherwise used to invest in public companies (by way of a 401(k), Roth IRA, or other investment vehicle) for retirement, my children's education or general savings is now being invested in businesses that I own and control instead of companies that I own a tiny fraction of and have no control over.

The amount of money I'm investing hasn't changed. Where I'm investing it has.

We've all been sold the story that the safe and conservative thing to do with our money is to give it to someone else and let them decide what to do with it. That the risky thing to do is invest in yourself and start your own business. I believe this is complete nonsense. The safe and conservative thing to do with your money is to keep it in your possession, invest in companies that you own, and keep these companies under your control.

Sending your money into the electronic casino where computers change the value of a company by 30% in minutes is what's risky.

Invest in yourself.