Benjamin Franklin is credited with coining the phrase “Time Is Money.” It’s from Advice to a Young Tradesman, Written by an Old One (1748). Here is the original:
Remember that Time is Money. He that can earn Ten Shillings a Day by his Labour, and goes abroad, or sits idle one half of that Day, tho’ he spends but Sixpence during his Diversion or Idleness, ought not to reckon That the only Expence; he has really spent or rather thrown away Five Shillings besides.
This is what economists call opportunity cost. Whenever you are doing one thing, you can’t do lots of other things. The cost or price of the highest value thing you aren’t doing is the opportunity cost of what you are doing.
But Ben Franklin’s quote, which is just the most widely shared version of similar thoughts over the millennia, brings up an interesting question:
In how many different ways can you say that Time Is Money for entrepreneurs?
We’ve found 13!
1. Do It Yourself, Your Time Is Money
Every hour you DIY like a good bootstrapping entrepreneur, you’re saving money and “a penny saved is a penny earned.” That’s another quote attributed to Ben Franklin, but he never actually wrote it!
2. Productivity Time Is Money
With an infinite “to do” list, every minute an entrepreneur saves through improved productivity gives you more time to make money.
3. Productivity Products, Because Time Is Money
Productivity products are bought and sold by entrepreneurs. They spend money to get more time. Or they make money by giving their customers more time.
4. Low Priority Focus Time Is Lost Money
Every minute you waste on unimportant things, you aren’t focusing on the most valuable tasks, which costs you money. This is another entrepreneurial spin on the “opportunity cost” concept Ben Franklin was talking about.
5. Employee and Contractor Time Is Money
Every hour someone is working for you, it costs you wages or billable hours.
6. Sales Prospecting Time Is Money
Every day you don’t follow up on a lead, the value of the lead goes down another 15%. Or some big number.
7. Early Problem Solving Time Is Money
“A stitch in time saves nine” – yet another relevant aphorism – means that entrepreneurs should invest a little time now to fix problems that will be really expensive later. Customer problems, employee issues, product imperfections all cost less with early urgent attention.
8. Customer Payment Time Is Money
Every day your customers pay you faster on average, your need for a working capital loan goes down 3%.
9. Debt Payment Time Is Money
Every month a loan or credit card balance is outstanding, it costs interest. Every day you miss a scheduled payment, late payment fees cost you money.
10. Earlier Equity Time Is Money
If you take a $1 million investment today versus a year from now, it could cost you 10% more of your company which might otherwise be worth $10 million to you in 7 years.
11. Faster Investor Returns Means Less Time Is More Money
Professional investors are judged by how much money they make in how much time. Once they are on board as your investors, every quarter that passes means they want their return even more urgently. You spend more time focusing on making them money.
12. Competitive Progress Time Is Money
In hotly contested winner take all markets, every week your competitors make more progress than you, the future value of your company goes down. Which maybe is a good reason to take investors’ money now!
13. Purchases Translate Time Into Money
If you make $25/hour after tax, your $5 Starbucks latte is worth 12 minutes of your work. And if your company has after profit taxes of $1000/month, it takes 4 months for your entire business to buy that fancy $4,000 executive desk.
Wow, that’s a lot of ways that time is money for entrepreneurs!
Did we miss any?