Four Types of Money in Software

In the software business, there are four types of money to be made:

1. Sweat Money – money that requires a shit ton of effort with no certainty that it will pay future dividends.

2. Easy Money – money made with minimum effort and generates comfortable gains.

3. Lazy Money – money you get for free, no effort necessary.

4. FU Money – money that requires a spike in effort and (in return) prints more money in perpetuity.

In 1997, I took on my first W-2 job in middle school as a paperboy. I didn’t make much money and the working conditions were not ideal. Every day (even on Sundays) I would wake up to my 5 AM alarm clock, put on clothes, and walk upstairs to the front porch, where hundreds of newspapers waited for me to wrap them each with a rubber band and deliver them. I made about eight dollars an hour, so it took a long time to accrue enough money to build out my gaming computer. This was the whole point of the job and I dropped it after two years when I met my savings goal.

The paperboy job was Sweat Money. Being a newspaper boy is not hard in theory, but the news takes no days off and to throw papers for 365 days straight before sunrise was brutal. But that Sweat Money, which I used to build my gaming computer, led to doing less exhausting work.

The cool thing about building a gaming computer in 1999 is that everyone and their momma was freaking out about their computer crashing due to the Y2K bug. So, after the word spread that I had built a computer, friends and their parents would hit me up to back up files to a compact disk, reformat computers, etc., and I would charge them a fee for my time. I can’t remember what I would charge but it largely depended on how close of a friend they were to me and ranged from nothing to one hundred and twenty-five a visit.

After year 2000 passed and no computer apocalypse resulted, I’d regularly build a custom computer for a friend and this got me into buying computer parts on eBay. What I liked about buying computer parts online and especially on eBay is I could get parts for low price, mark up the price, and pocket the difference. Although this was pretty good money, I got tired of building computers after school and started to realize I could minimize my human interaction, move computer parts via eBay, and continue to make money.

Between these two activities, building computers and selling parts on eBay, I learned to make Easy Money. This hustle lasted for almost two years before my mom suspected of me selling computer parts illegally online - I wasn’t. All she knew was boxes were being delivered and shipped off to the house with her having no idea what was happening. Mom shutting me down paved the way to Lazy Money.

After a couple years of fixing computers and moving parts, I’d learned about a NetZero ad program that allowed anyone to get paid to click on ad banners. All I had to do is install a piece of software on my computer and it would place a banner ad on my screen. If I clicked on the ad, the software would count my total unique clicks per ad and pay a percentage of the revenue NetZero made to ad-click professionals like me.

I immediately opted into this scheme and I remember getting a check for about twenty-five dollars. It was fascinating when I reflect back. So, I started to think of how I could automate clicking the ads so I didn’t have to physically be present. After a few months of learning how to write code on Windows, I built a program that clicked NetZero ad banners every minute without me being in front of the computer. The result was about a 10x gain and for about a year I brought in two hundred and fifty dollars every month. Lazy Money.

When I reflect on my relationship with money and computers, a couple things stick out. Computers enabled me to make money for less time and effort than being a paperboy. This revelation has played out in my education as a computer scientist and career as a software engineer.

Throughout my journey I have obtained the first three types of money I described at the beginning. Sweat Money as a paperboy, which enabled me to build my first computer. Easy Money from my career tinkering with computers. And lastly Lazy Money from programming.

Most software entrepreneurs don’t do it for financial reward alone, but let’s be real. This is where FU Money comes into play. FU Money would have been if I given my ad-clicking program to a thousand, a million, ten million people and kept some share of their profits. I’ve never achieved this level of money making and I occasionally ask myself why I haven’t. Is it because I’m not risky enough? Is it because the spiked effort for achieving FU Money is so daunting that I am not up for the task? I don’t know the reason. What I do know is that these questions occasionally keep me up at night wondering whether I am destined for a startup career path.

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