Let’s begin with two truisms when it comes to your money.
First, you can’t invest if you don’t have any.
Second, with the economy as it is, being completely dependent on your employer might not be a great idea: Your paycheck could disappear overnight, as the millions of people who have filed recently for unemployment have unfortunately learned.
Chris Guillebeau, whose daily podcast is called “Side Hustle School,” thinks he has a solution for both problems, which he presents in the novel “The Money Tree” (Portfolio, $26.) His answer: Start a business.
Ideally, do it while you have a day job. Bootstrap your way into starting a business on the side, one that could supplement your current income and potentially even replace it. But many of the ideas he presents will help, too, if you find that your job is gone or suspended.
The plot is as basic as it can get.
Jake Aarons, a millennial, is in all kinds of financial trouble. He has more than $50,000 in overdue student loans; it looks like he is going to lose his job at a digital marketing agency as a result of a pending merger; and he is being evicted from the condo he has been renting in the Bay Area. It also looks like his girlfriend is about to dump him.
Just as Jake’s financial problems are at their worst, he is introduced to a new way of thinking by Clarence Johnson, a former entrepreneur who runs a weekly meeting for people looking to start businesses.
It’s a five-step plan:
Draw on what you know or can do.
Move quickly from idea to specific product or service.
Spend as little as possible to get underway.
“Launch before you are ready. You won’t get the feedback you need until you have something to show.”
“Improve as you go.”
His message may not be new, but it is worth pondering.
Part of a new wave
Mr. Guillebeau says businesses are typically started, and funded, in two ways:
You write a business plan outlining what you intend to do — start a coffee shop or manufacture pencils — and then go off in search of money in the form of loans from banks, family members and friends or just use your credit cards to get underway.
You have an idea and seek venture capital, in exchange for equity in your concept, to develop it.
What that leaves out, however, is the group of people who start small with whatever resources are at hand — a lawn mower, for example — and parlay cutting the neighbor’s yard into a landscaping business and expand from there, moving into general property maintenance, perhaps.
In recent years, there have been a host of nonfiction books, like “The Lean Startup” by Eric Ries (Currency, $28), that put a contemporary spin on this long-established way of starting a company.
These books argue that if you are starting a business, you want to determine fast what customers want and are willing to pay for. The authors urge you to get into the marketplace as quickly and cheaply as possible with a prototype of your product or service and modify it as necessary based on customer feedback.
Mr. Guillebeau’s novel is a fictional extension of this genre. With unemployment rates up dramatically and no one having a clue when the economy will get back to normal, finding ways to augment, or even potentially replace, a paycheck has urgent appeal.
If you can experiment with ways of doing it at little or no cost, it becomes even more appealing. That approach will allow you to discover the concepts that are the most profitable, as well as the ones you find most personally satisfying. (They are not always the same thing.)
And indeed, Jake experiments with numerous ideas: He begins by buying and selling used textbooks, then tries offering negotiation advice, followed by providing counseling to help people pay off their student debt. None are particularly successful or fulfilling. But they don’t cost him very much to start.
He is a sole practitioner doing these side jobs on nights and weekends, and each provides him with a little bit of income. It is easy to imagine him persevering with his efforts, even if he had, like so many people right now, lost his day job through no fault of his own.
By the book’s end, Jake is smitten with the idea of creating a resource directory for budding entrepreneurs in developing countries. If he can get people to sign up for a subscription to the service, he thinks, his money problems could be over.
Options are good
In talking about his financial situation, one of the characters in the book says: “Money is not everything, but when you don’t have it, you have less control. You have fewer choices.”
Mr. Guillebeau’s objective is to give you more choices in the way you decide how you will make the money that will allow you to survive and, maybe, invest.
The way he chose to deliver his message is unconventional. But these are unconventional times.