As part of this entrepreneurship series, let’s focus on point #5 in my Top 5 Reasons to Become an Entrepreneur - the Upside. Yes we are going to talk about the value of money, a topic that I feel is essential for fully exploring the reasons behind entrepreneurship and the values behind business in general. Needless to say everything below is based on my own opinions and values. I do hope that my thoughts on the subject help the readers of this blog reconcile their own value system with their own interactions with money.

Money means a whole lot of different things to different people from being the source of all evil to the ultimate dream. It’s common to politely downplay its importance, yet enough people buy a lottery ticket for the cost of a coffee for there to be millions of dollars in prizes given away each week. How can people, often the same person, complain about the evils of money and yet desire it so much at the same time?

What Role Should Money Play?

Being on a “career” path that is so heavily based on money being valuable I’m very much interested in this question. It’s very easy and even fashionable to dismiss its value as anything other than a necessity. I disagree with this viewpoint, but I also find the idea of living strictly for the persuit of money rather unappealing.

Clearly I am interested in profit resulting from what I do and I don’t see that as being an inherently bad thing. I have several for-profit ventures, and one of my criteria for this very blog is that it generate enough income to be “self-sustaining” (defined here as generating enough financial value for me to make the opportunity cost of running it lower than not running it). Yet the desire for money has been and currently is at the heart of some tremendously terrible events in the world. Due to the consequences that greed can have, the blind persuit of money or wealth is not something I subscribe to, nor do I believe it’s something that anyone else should do for the sake of building a better world for everyone.

Money Is Just a Tool

Economics teaches us that money is a form of storing value, and depending on which classification you use that can mean anything from cash to bank accounts to bonds. This value is your buying power and allows you to obtain goods and services in exchange for a portion of this value. It’s a remarkable idea and must be one of the most important advancements of civilization. No longer do we need to cart around livestock or decide how many music CDs an oil change is worth. That’s all there is to it, money is a tool that represents part of the value we create.

From here on out I am concerning myself only with value creation. The endeavours that I participate in create value and this value is divided between myself and often others that my actions benefit. For example everytime I sell a copy of CustomBar, value is created. My customer has just gained an amazingly productive tool that benefits him or her enough to pull out the credit card and purchase the product. I in turn have received value in the form of a monetary payment, but I’ve also gained so much more. I now have a larger user base and the referrals that come with it, which in turn generate even more value. I also have the satisfaction of knowing that someone out there really enjoys the product that I poured my mind and heart into for two years.

I consider money valuable and important because it provides an easy medium to store and exchange some of the value I generate for other more useful things. In that sense money really becomes critical, because I have goals that require money to be achieved reasonably. On the other hand money is just a trivial detail, since I know that if I generate value for others and for myself in a meaningful and effective way then I will have no problems exchanging part of this value into a form that I can use to aquire the other resources I seek. In fact I am accidentally giving away part of the equation for reliably earning money: it’s not how hard you work, it’s how much value you generate.

Keeping in mind everything I’ve just said, here is my statement of where money fits in life:

“Money is required for some of the objectives I intend to achieve and it is therefore valuable. Money itself cannot bring happiness, but often the persuit of money can bring about the exact opposite. Therefore I will only persue money in ways that are in and of themselves worthwhile, enjoyable and in line with my value system. I expect to be rewarded with financial value only when I myself generate value for others, and this condition will be kept foremost in my mind in any business venture that I engage in.”

Where does money fit into your life? Why do you cash the cheques that you receive?

Got something to say? Leave a response to this post.

 Get the latest updates by subscribing to the feed.

Semi-Related Posts

• How to Get Rich by the Owner of Maxim
• Success Points for Starting a Business as a Student
• Remembering The Tremendous Value of Education
• How I Finally Made Money from My Technical Abilities: Switching Directions From Computers to Business

This entry was posted on Tuesday, April 11th, 2006 at 2:32 pm and is filed under Business. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.