This is a story about how I lost $10,000,000 by doing something stupid.

Ten. Million. Dollars.

Literally up in smoke. Money bonfire.

That’s enough to retire with $250,000+ in annual income.

Here’s what happened…

In 2009, @metalab was a small but profitable agency.

The business was making a couple hundred thousand dollars a year in annual profit and I was trying to figure out how to invest the profits.

Agencies can be great businesses, but they are HARD.

You lose clients at random, your pipeline dries up on a dime. It’s feast or famine and unpredictable.

I kept reading about what @dhh and @jasonfried were doing with Basecamp, building software for themselves then selling monthly access to

This was a relatively new concept back in those days, and it seemed like they were living the dream. I had a business crush.

The model they used for Basecamp was:

1. Build great software that scratched their own itch (project management)

2. Assume others have this problem

3. Charge a monthly recurring amount to give them access (SaaS)

4. Focus on organic growth via product improvement and public writing

5. Spend less than they make

6. Profit