When Fastlane doesn't make sense?

Panos Daras · Nov 15, 2023

consultantMBB said:
I do not really care, as long as stuff is legal.

That's quite a low bar right there. OnlyFans is legal and makes a lot of money, but I never pursued that path. Not that anyone would buy my services anyway.

Andy Black · Nov 15, 2023

Can you grow what you know?

Are you able to create other income streams based on your consulting skills and experience?

Maybe by taking on consulting clients for yourself?

Maybe by providing tools or training for other consultants who do what you do (or want to do what you do)?

I'm sometimes a consultant.

I also take on smaller clients where it's more rinse-and-repeat.

And I have courses people can take to either do the technical part of what I do, or to become a consultant.

We're also developing systems and encapsulating our skills and experience into SOPs and code. We'll use those to build other products and potential revenue streams, or just speed everything up.

You're not flat-broke, but this video from MJ might help you monetise a skill:

GOLD! - HOT! - From Flat-Broke to Financial Freedom: How to Get Started When You Have No Money

I see this question a lot here, and posted in a lot of introductions. How do I get started when I have no money and no skills? I made a video to answer... Also there's an update on my next book near the end of the vid! Enjoy, and if you're broke with no skills, I hope it helps you!

www.thefastlaneforum.com

consultantMBB · Nov 15, 2023

Kevin88660 said:
It is not about the narrative. It is about the numbers.

You were arguing against Fastlane using the better-than-best-case scenario of your career progression. 1M annual income in 7 years, saving rate 40%, net asset close to 5M in 10 years.

I am from Singapore, one of the most "expensive" cities in the world. Many CEOs of the local publicly traded companies do not make 1M annual income.

You can also look into the book Lean Start-up. You don't have to take heavy financial and time losses into a bad idea that will never fly.

The only exception I think of a slowlane employee with fat paycheque is a Machine learning Ph.D. working in a reputable quantitative trading firm managing a significant AUM.

You are right to point out the opportunity cost of business, loss in savings, and career progression. That's expected.

Over the past 15 years, I saw firsthand how MBAs are becoming useless in asset management and getting replaced by college kids with mediocre grades so long they can backtest and code trading strategies. Very soon coders are getting replaced by discretionary traders assisted by AI fed with data and human-generated strategies.

I am assuming 60% saving rate, exactly the same as I will have for 2023
The salary levels I confirmed with multiple sources, I work with people from MBB ME offices, as salary is not negotiated it is not a big secret, of course, it varies due to bonuses (especially on partner level)
Look even your example of ML in quantitative trading, it is a high leverage of impact that one person can make, the same as consultants have on a multi-billion USD transactions or investments

Panos Daras said:
That's quite a low bar right there. OnlyFans is legal and makes a lot of money, but I never pursued that path. Not that anyone would buy my services anyway.

Got your point, I wouldn't do it either but I do not see the value of discussing that. Selling cheeseburgers is also wrong as it is unhealthy for customers. Everyone has different pain points of what would do for money (and for how much), but it is more like a philosophical debate

Andy Black said:
Can you grow what you know?

Are you able to create other income streams based on your consulting skills and experience?

Maybe by taking on consulting clients for yourself?

Maybe by providing tools or training for other consultants who do what you do (or want to do what you do)?

I'm sometimes a consultant.

I also take on smaller clients where it's more rinse-and-repeat.

And I have courses people can take to either do the technical part of what I do, or to become a consultant.

We're also developing systems and encapsulating our skills and experience into SOPs and code. We'll use those to build other products and potential revenue streams, or just speed everything up.

You're not flat-broke, but this video from MJ might help you monetise a skill:

GOLD! - HOT! - From Flat-Broke to Financial Freedom: How to Get Started When You Have No Money

I see this question a lot here, and posted in a lot of introductions. How do I get started when I have no money and no skills? I made a video to answer... Also there's an update on my next book near the end of the vid! Enjoy, and if you're broke with no skills, I hope it helps you!

www.thefastlaneforum.com

I can leverage my skills/assets to become business angel (it is a reason why I mentioned that previously)
You cannot take consulting clients yourself (non compete)
Creating content for consultants, I thought about that but it is too small niche, the only big market related to that is people who wants to get into consulting (but that space is already crowded by good startups and creators)
Thanks I will check the video

BizyDad · Nov 15, 2023

Kevin88660 said:
It is not about the narrative. It is about the numbers.

You were arguing against Fastlane using the better-than-best-case scenario of your career progression. 1M annual income in 7 years, saving rate 40%, net asset close to 5M in 10 years.

I am from Singapore, one of the most "expensive" cities in the world. Many CEOs of the local publicly traded companies do not make 1M annual income.

I feel like you look at the world through only your lens. I've noticed this in many of your comments over the years.

Just because local Singapore CEO's don't make a million, you assume a million is almost impossible.

Why?

And yet, "middle management" type positions in MBB forms in Chicago, NY, Boston, London, etc do make a million in total compensation. This is associate partner level compensation. Senior positions make $3M and up...

And the job security is generally better than a publicly traded CEO's too.

Why do you assume your "expertise" is better than the guy who works in the industry? Especially when a simple Google search backs up the guy's assessment as not unusual.

Why call it "better than best" case?

Trismigistus · Nov 15, 2023

It kinda seems like you came here to get entrepreneurs to validate your 9-5. Why?

Kevin88660 · Nov 15, 2023

BizyDad said:
I feel like you look at the world through only your lens. I've noticed this in many of your comments over the years.

Just because local Singapore CEO's don't make a million, you assume a million is almost impossible.

Why?

And yet, "middle management" type positions in MBB forms in Chicago, NY, Boston, London, etc do make a million in total compensation. This is associate partner level compensation. Senior positions make $3M and up...

And the job security is generally better than a publicly traded CEO's too.

Why do you assume your "expertise" is better than the guy who works in the industry? Especially when a simple Google search backs up the guy's assessment as not unusual.

Why call it "better than best" case?

He is talking about more than more than five fold his income in seven years in consulting.

How is that a likely event more than 50 percent?

He is building on his assumption that he will outcompete everyone else fighting for the same role.

It is a goal. It is a dream. It is not an opportunity cost calculation to rule out running one’s own business.

If you can beat the smartest people in the country consistently over 7 years then I wouldn’t say he has a low chance of making it in business. He already had the skill and grit to outcompete 80 percent of the top one percent which places him at top 0.2 percent (still a conservative estimate) of the population.

I would agree with his conclusion that fastlane is meaningless for him if he is on track to hit high pay in a short number of years simply keeping his current level of performance.

Lou7 · Nov 15, 2023

@MJ DeMarco

You'll like this thread. Hot and profound discussion!

Aecio · Nov 15, 2023

consultantMBB said:
I read “The Fastlane” book and agree with the general concept that Fastlane is better than Slowlane.

However, I am struggling to think about how/if it applies to my situation.

I am ~30yo

I live in a European country with a relatively low cost of living (prices around -50% vs US)

Currently, I and my wife make 100k USD net and have a 60% saving-to-income ratio

Just for context, my salary is in the top 1% in my country

I am working in top-tier consulting (MBB) - I like the job, although shitty WLB (60-70h workweek)

I am considering moving to Dubai, where I alone can make in the next 10y 5m USD net (assuming salary in 1st year 200k USD and growing till 1m USD over next 7y, not assuming any inflation) at 60h workweek

Treating the above as a baseline, combined with my wife's earning, high savings to income, compound interests (ETFs, properties for rent, crypto), I should achieve ~5m USD in 10y with a relatively low risk.

Now I struggle to think if trying to switch, in my case, to Fastlane does make sense, as:

The risk of failure is significant (% of companies that achieve success is relatively low)

It is not worth risking something that you need (low-risk path to 5m USD in 10y) for something that you do not need (wealth of >5m USD)

What are your thoughts on that? It is a kind of edge scenario like old CEOs (although I won’t be so old ) mentioned in the book.

P.S. An alternative option that I am considering is decrease in investment in ETFs and be a business angel as a side hustle to work in consulting, with some luck, it can break the 5m USD threshold

Dude, you have a job that pays you very well. Perhaps the only problem is the long working hours.

Reading the book leads us to believe that a job is “bad”, but a job that pays well can be a good thing.

Analyze what you want in terms of lifestyle and see how you can enjoy the present moment.

Learn to invest, in a few years you can have a lifestyle with more freedom and prosperity.

But keep in mind that you have already “won” in life.

Aecio · Nov 15, 2023

Trismigistus said:
I dont understand, why come to a forum about/promoting entrepreneurship, and make the case for a 9-5 working for someone else?

Entrepreneurship is not the only way to wealth, and the guy has good points. Seems an honest discussion.

Kevin88660 · Nov 15, 2023

AÃ©cio said:
Entrepreneurship is not the only way to wealth, and the guy has good points. Seems an honest discussion.

Definitely, just like someone can be a billionaire for being Google’s CEO.

But there is no safe and secure way to massive financial success without beating many other people and being on top in the game. And you need some element of luck as well to be that exceptional.

BizyDad · Nov 15, 2023

Trismigistus said:
It kinda seems like you came here to get entrepreneurs to validate your 9-5. Why?

He has a strong case to stay where he is.

consultantMBB said:
@BizyDad that is an interesting idea, do you mean to be a kind of business angel or something more specific?

I do have managerial expertise as I managed ecomm, and now I am managing project teams, and our projects are kind of solving CEOs problems. However, managing people in consulting is kind of easier as you manage highly intelligent and highly motivated people, in normal business it is not the case.

I do not have experience in sales, and in the next 4+y it will not be required at consulting work.

An angel is too removed from the day to day of the business for my taste. I don't know that I would tie up my money with something small (i.e. small business) where I can't keep an eye on it. At least in the stock market you have liquidity.

I was talking about ownership. Purchase an existing company that has a management structure in place. Find someone in that company who can take over the day-to-day management, and make them your minority "partner". Give them a share of the profit in addition to salary. It doesn't necessarily have to be on paper ownership, you can maybe just do a profit share with them.

You manage that person. They manage growing the business.

You keep an eye on the bank account. In an ideal world, you watch it grow. When big decisions come up, the manager has to consult with you before he or she writes the big checks.

I did something similar when I purchased a business last year with a partner. He runs the day to day, I make the phone ring and weigh in on the major decisions while running my agency as my primary biz. Thanks to a favorable purchase price and 60% sales growth, in less than 2 years, we have a pretax return of more than 5x our initial investment.

BizyDad · Nov 15, 2023

Kevin88660 said:
How is that a likely event more than 50 percent?

Sure, that sounds far fetched in many industries.

But a Google search shows in his career path, this is achievable. Not unusual.

And frankly more likely than his hitting a home run in business in 7 years.

In fact, if he doesn't hit a million, he'll probably get managed right out of the firm. Then he could start his entrepreneur journey, with a lot more cash in hand than if he quits now.

I don't know about you, but back when I worked for "the man" I always had a pretty good sense of whether the higher ups thought of me as "promotion worthy" or not.

This guy is a better judge of the likelihood than you or I are.

You can try calling BS in his goal, but like I said, easy Google searches back him up. There are many online discussions about the possibility of hitting a million at an MBB firm.

And just so we're clear, since you are such an advocate for entreprenuership at all costs, aren't you still working for the man? Or do you have a business up and running?

Kevin88660 · Nov 15, 2023

BizyDad said:
Sure, that sounds far fetched in many industries.

But a Google search shows in his career path, this is achievable. Not unusual.

And frankly more likely than his hitting a home run in business in 7 years.

In fact, if he doesn't hit a million, he'll probably get managed right out of the firm. Then he could start his entrepreneur journey, with a lot more cash in hand than if he quits now.

I don't know about you, but back when I worked for "the man" I always had a pretty good sense of whether the higher ups thought of me as "promotion worthy" or not.

This guy is a better judge of the likelihood than you or I are.

You can try calling BS in his goal, but like I said, easy Google searches back him up. There are many online discussions about the possibility of hitting a million at an MBB firm.

And just so we're clear, since you are such an advocate for entreprenuership at all costs, aren't you still working for the man? Or do you have a business up and running?

I am not an advocate for entrepreneurship at all cost.

I merely jumped at the argument “business is meaningless to me because I will 5x my employment income”.

But he has explained the numbers and ratios in the next post. Now I understood that he is not making some wild projections.

consultantMBB · Nov 15, 2023

Trismigistus said:
It kinda seems like you came here to get entrepreneurs to validate your 9-5. Why?

My interpretation is different. It is a forum for/of people who want to be wealthy, and entrepreneurship is usually the best way to achieve that.

Kevin88660 said:
He is talking about more than more than five fold his income in seven years in consulting.

How is that a likely event more than 50 percent?

He is building on his assumption that he will outcompete everyone else fighting for the same role.

It is a goal. It is a dream. It is not an opportunity cost calculation to rule out running one’s own business.

If you can beat the smartest people in the country consistently over 7 years then I wouldn’t say he has a low chance of making it in business. He already had the skill and grit to outcompete 80 percent of the top one percent which places him at top 0.2 percent (still a conservative estimate) of the population.

I would agree with his conclusion that fastlane is meaningless for him if he is on track to hit high pay in a short number of years simply keeping his current level of performance.

I am using more levers. Dubai salaries are higher than in my country, plus you have 0% income tax vs 45% in my country. And I do not feel like there is a point in discussing MBB salaries. If you do not believe in that, you can treat is as a granted just for the purpose of discussion.

Getting a promotion in MBB is not a rat race, they want you to succeed, and they want you to stay in the company. There is no limit to how many people can get promotions (at least below partner level), etc.

And most people are leaving MBB as they just do not want to do it anymore, regardless of money. Also, it is kind of reason why the salary is so high, the want to retain people.

Re your calculation, the chances to get to mbb is 1% of people who applied, eople who apply are usually a lot above average, however, I wouldn't rate myself as top20% within MBB (and I do not have to, I didn't assumed any shortening promotional path in the baseline scenario).

One important thing, getting a promotion in MBB is not a luck, it is just hard work. Using luck you can a bit shorten a period between promotions, but that's it. On the other hand for own business I think there is a big element of luck (or stuffs that were not possible to predict).

AÃ©cio said:
Dude, you have a job that pays you very well. Perhaps the only problem is the long working hours.

Reading the book leads us to believe that a job is “bad”, but a job that pays well can be a good thing.

Analyze what you want in terms of lifestyle and see how you can enjoy the present moment.

Learn to invest, in a few years you can have a lifestyle with more freedom and prosperity.

But keep in mind that you have already “won” in life.

Yeah, that is my struggle, that the author assumed that slowlane is the average salary and 10% savings to income (if I remember correctly), which makes sense for most of the readers. But I have top1% salary and 60% savings to income.

Also worth mentioning that buying and renting multiple apartments was mentioned as a Fastlane, such an activity can be easily built upon MBB salary (and a lot of MBB employees do that indeed). E.g., we have a senior manager with 8 apartments for rent.

Kevin88660 said:
Definitely, just like someone can be a billionaire for being Google’s CEO.

But there is no safe and secure way to massive financial success without beating many other people and being on top in the game. And you need some element of luck as well to be that exceptional.

The comparison does not make sense at all. There are likely around 5-6k partners in MBB in total. It is like one partner for 7-10 other consultants, and I am mid-way (or even slightly above) of the 7-10 people. To put it into the Google CEO scenario I would need to be likely another C level in Google to make it comparable in terms of chances...

The only "luck" that I am missing is if I will be(/become) good at selling projects... rest of that it is just hard work. Just a reminder on every project I work with at least one partner, sometimes 2-3 partners. I see their work, I have interactions with them. I am able to imagine myself in their positions and I do not see a significant gap other than experience and skills that I can work on. It is not the case that they are 5x more smarter than me.

Kevin88660 · Nov 15, 2023

consultantMBB said:
My interpretation is different. It is a forum for/of people who want to be wealthy, and entrepreneurship is usually the best way to achieve that.

I am using more levers. Dubai salaries are higher than in my country, plus you have 0% income tax vs 45% in my country. And I do not feel like there is a point in discussing MBB salaries. If you do not believe in that, you can treat is as a granted just for the purpose of discussion.

Getting a promotion in MBB is not a rat race, they want you to succeed, and they want you to stay in the company. There is no limit to how many people can get promotions (at least below partner level), etc.

And most people are leaving MBB as they just do not want to do it anymore, regardless of money. Also, it is kind of reason why the salary is so high, the want to retain people.

Re your calculation, the chances to get to mbb is 1% of people who applied, eople who apply are usually a lot above average, however, I wouldn't rate myself as top20% within MBB (and I do not have to, I didn't assumed any shortening promotional path in the baseline scenario).

One important thing, getting a promotion in MBB is not a luck, it is just hard work. Using luck you can a bit shorten a period between promotions, but that's it. On the other hand for own business I think there is a big element of luck (or stuffs that were not possible to predict).

Yeah, that is my struggle, that the author assumed that slowlane is the average salary and 10% savings to income (if I remember correctly), which makes sense for most of the readers. But I have top1% salary and 60% savings to income.

Also worth mentioning that buying and renting multiple apartments was mentioned as a Fastlane, such an activity can be easily built upon MBB salary (and a lot of MBB employees do that indeed). E.g., we have a senior manager with 8 apartments for rent.

The comparison does not make sense at all. There are likely around 5-6k partners in MBB in total. It is like one partner for 7-10 other consultants, and I am mid-way (or even slightly above) of the 7-10 people. To put it into the Google CEO scenario I would need to be likely another C level to make it comparable in terms of chances...

The only "luck" that I am missing is if I will be(/become) good at selling projects... rest of that it is just hard work. Just a reminder on every project I work with at least one partner, sometimes 2-3 partners. I see their work, I have interactions with them. I am able to imagine myself in their positions and I do not see a significant gap other than experience and skills that I can work on. It is not the case that they are 5x more smarter than me.

I would agree that high income earners at your level if can maintain a high saving rate will eventually make it in the millions quite easily.

It becomes clear that opting into business will decrease your long term expected value of lifetime wealth since it has a larger component tied to luck whereas in your job you just have to dedicate the hard-work and hours. And any money outside of the first 5 million has diminishing marginal utility the expected value on your utility/happiness will be much worse.

The potential pitfalls tends to be social and psychological that a lot of high income earners have to live up the expectations of better lifestyles and end up save a lot less than they should.

consultantMBB · Nov 15, 2023

Kevin88660 said:
The potential pitfalls tends to be social and psychological that a lot of high income earners have to live up the expectations of better lifestyles and end up save a lot less than they should.

But the issue is valid for high earners regardless of source of income (own business/employment).

The lifestyle inflation is a trap, I am increasing my salary-to-income ratio as my salary rises. Especially, in consulting some people live in golden cages/handcuffs, they have very high standards of leaving, they want to leave consulting but they cannot without a significant pay cut (and therefore lowering the standard of leaving), so they stay longer but they are miserable.

On the other hand, I have seen entrepreneurs going all in their own (and one) businesses and high standards of living (e.g., expensive cars to show off, often in leasing). Then there is a COVID or another disruption and they end up with nothing.

Both segments should consider investing some % of income into diversified ETFs

Lou7 · Nov 15, 2023

@consultantMBB

This story may help you with ideas:

The former Operations VP of my company used to work for the Big M. He was a project leader and just had left Harvard MBA
He used to say that he hated big M
He got really fed up and entered an opportunity with a paycut but lot's of stock options. Also, he said that the work was more pleasing because he had more freedom to do what he wanted
The vesting period is over and now he is a director in another company (he asked for more stocks but were negged)

consultantMBB · Nov 16, 2023

I don't get the takeaway from the story

Lou7 · Nov 16, 2023

consultantMBB said:
I don't get the takeaway from the story

Sorry, forgot the conclusion hehe

He said it was the best decision he made. The pay gap was not so big, he was happier and he has an asymmetrical chance with the stocks!

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