This is one post/chapter in a serialized book called Startup 101. For the introduction and table of contents, please click here.
You did it all: you built a valuable venture and sold it. The contract was signed… finally! The wire transfer came through. You are wealthy. Congratulations! So, what’s next?
Why even think about that ahead of time? Two reasons. First, if you think about it clearly now, you will be better positioned to know what you want when you negotiate your exit. Secondly, many people go a bit “off the rails” when they finally get to relax after years of hard venture-building. This post assumes you had a big payday; if the exit was just enough for you to pay off some debts, you’ll probably be back at work on Monday — not much else to consider.
5 Tips for the Recently Cashed-In
- Take at least three months fully and completely off. Really switch off all electronic devices. Reconnect with friends and family. Do whatever you love doing. Recover some of the health and fitness that your years of stress and overwork undid. Only after this sabbatical will you be able to think clearly about anything.
- Don’t make any high-risk investments for at least a year. You may become an angel, and that’s a great thing to be: it can be fun, you can give back to the entrepreneurial community, and you may even make some money. But recently cashed-in entrepreneurs have a habit of jumping into bad deals quickly. Keep track of the deals you want, but don’t hit the “Send cash” button until you are clearer about how you want to operate as an investor. Tell all the great entrepreneurs whom you want to maintain relationships with what your game plan is, so that expectations are clear.
- Avoid the “Coulda, woulda, shoulda” return act. You probably had to make trade-offs in your venture because of capital constraints and/or investor pressure. Now with money and fame, you could jump back in (if the non-compete terms from your last venture permit) and show them all how it really should have been done. These often turn out to be disasters, because the motivation is unclear.
- Take time to evaluate the bees in your honeypot. You are suddenly on the wealth management industry’s map. A lot of folks want to help you manage that loot. Many of them are real professionals, and you will need some help. But there are also scammers and people who simply don’t add any real value. Take your time.
- Re-connect with a long-lost passion. This may take you completely away from business. Or it may point you to your next venture.
(Photo credit: danesparza.)