A guest who retired at 31 with over $20 million walks through how he set his goal at age 19, paid himself almost nothing for years while building The Hustle, structured a creative rent-sharing arrangement in San Francisco, and eventually hit his number when his company sold. The conversation also covers the fat FIRE subreddit and a fascinating anonymous thread from a hecto-millionaire.
Speakers: Sam Parr (host), Shaan Puri (host), Guest (fat FIRE retiree, sold company at 31)
Introduction: The Fat FIRE Subreddit [00:00:00]
Shaan: So there’s this subreddit that I go to and I love it. It’s called fat FIRE. The idea is people who want to retire relatively young with a lot of money so they can live a fat life without working. If you post on there a lot, the mods — the community leaders of the subreddit — will verify your net worth to make sure you’re not full of it.
Sam: By the way, did you have a goal like this? Like, “I want to retire by X age” or “I want to be this wealthy by this age”? How did you phrase your goal?
The $20 Million Goal [00:00:30]
Guest: I wanted to have $20 million by age 30.
Sam: Gotcha. That’s what you wanted. That was your goal.
Guest: I created that goal when I was 19 or 20 years old. I can’t confirm or deny, but — mission accomplished is what I would say. I sold my company. I achieved it at 31. I sold my company at 31.
Sam: Right.
Guest: So that was my goal. I made it because I asked a rich person I knew, “How much money do you spend a month?” They told me $60,000 a month. At the time I was like — I don’t know, I can’t imagine there’s a world where I would spend that. That sounds crazy. But I asked about eight people and this person had the highest number, so I was like, okay, I’ll just use that because I’ll be conservative.
Then it’s a percentage of your liquid portfolio. Basically it continues to grow — you need enough money that the compounding earnings on money invested in something safe, like the S&P 500, can cover your burn rate.
So there are two things that matter: what is the amount I have invested, and what is my life burn rate. That’s why a lot of people who do FIRE move to, like, the middle of nowhere and say, “Oh yeah, I got rid of my car, I got rid of everything I own, me and my wife only eat apple cores, and now we’re retired.” But fat FIRE is different. Fat FIRE is like — I want to ball out. I’m not trying to skimp on my lifestyle. So what do I need to achieve, and what do I need to optimize, while still not giving up what I find to be enjoyable in terms of lifestyle?
Sam: Yeah.
Guest: That’s how I came up with that number. And I spend $15,000 a month.
How the Money Actually Came Together [00:02:15]
Sam: When you sold, you had saved a seven-figure amount. Of course that includes your wife — she also worked at Airbnb. Airbnb went public in December, you sold your company in February, so from December 1st to February 1st it was like two or three months of just massive events back to back. But let’s set her aside because we don’t want to put her business out there. Let’s just talk about you. In your early 20s, what were you making?
Guest: From age 22 to probably 26 or 27, I paid myself something like two grand a month. The first year of the business I probably paid myself $20,000 for the year. Then $40,000 for the next two years. Then $70,000. Then the year we sold I paid myself close to $300,000.
Sam: So that’s: $24K a year, $40K a year, $40K, $70K roughly.
Guest: Yeah. 20, 40, 40, 70. Four years in, and then the year we sold — close to $300K. And I had a few other things like some angel investments and some weird deals that kind of paid off. But basically, for the longest time I was living… the way I rigged it was, in San Francisco my rent was only $400 a month, because I rented out this big place and spent all $25,000 I had to my name to rent it out and furnish it. Then I rented it out to people who basically subsidized it for me. So I was living like a poor person, except—
Sam: You were living like a wealthy person, really. You were in a place and it was only costing you $400 a month.
The San Francisco Rent Hack [00:04:00]
Sam: That’s a great example, by the way, because a lot of people say, “I want to move to San Francisco but I can’t afford it.” All you’re saying to me is: I lack creativity and resourcefulness. What you did is available to everybody.
Guest: I showed up at 22. It was a $4,500-a-month four-bedroom house. He goes, “Is it just you?” I go, “Look, it’s just me right now, but I’m gonna get some friends to move in. I’ll sign subleases with them and you can approve them. But basically I’m going to pay you on time, every time. And the preferred relationship you and I have is — I never see you again. Are you okay with that?” He goes, “Yeah.” He says, “Don’t be late.” I said, “Okay, deal.”
Sam: You cut this deal and basically became the landlord.
Guest: Yeah. I told him — if anything breaks, I’ll fix it. I think I lived there for seven years and never spoke to the person.
Sam: You never saw him?
Guest: I have not seen him once. If he showed up at the house I wouldn’t know who that guy is. I don’t even remember what he looks like. I think his name was Chris.
The Slow Build, Then the Sudden Jump [00:05:30]
Guest: So yeah — it was a slow build. It took five, six, seven years. But then what’s crazy is: I’m 32 now. I started hustling at around age 20, making real money, livable money. And at this point, at age 32, I’ll make more this year from a couple of side investments — a real estate deal I did — than collectively all of my salaries combined while working at The Hustle.
Sam: Exactly. And that’s the exact same case for me. I think that’s actually really common.
Guest: I think that’s really comforting to people. Because when you’re in it and you’re not making any money, and it looks like everyone else is making a ton, it can feel very bad. You question whether you’re on the right path. This doesn’t mean you’re definitely on the right path — but when the entrepreneurship path works, that’s commonly what it looks like. So don’t be surprised.
Envy in the Early Days [00:06:30]
Guest: All right — when I was getting going, I was always so envious of other people. My friends, I’d think: you got a job at Google, you make $150K a year, you have all these benefits. I haven’t been to the doctor in forever.
Sam: You would come to my office and be like, “Dude, this is your office?” And then we’d be eating something and you’d be like, “This cheese — is this cheese just always available? Whose cheese is this?”
Guest: They just bring you cheese!
Sam: I felt like — you’d be like, “Look, this cheese is from Whole Foods. This is expensive cheese.” I’m like, bro, stop talking about the cheese right now. But you were noticing all those things in a funny way.
Guest: I was freaking out. You guys have an espresso machine. What the hell is this? I remember I was like — I used to take food to go. So anyway.
Sam: Yeah, it accumulates quickly. And for most people it’s basically: you’re poor, you’re poor, you’re poor — and then suddenly it’s like, “Oh, holy crap, I’m not anymore.” You have that moment.
The Hecto-Millionaire Thread [00:07:45]
Sam: There’s a subreddit called fat FIRE, and they talk a lot about that. And there’s this guy who has a series of threads called “Confessions of a Hecto-Millionaire” — he’s doing like eight parts. I linked to it in there.
Shaan: I see five here.
Sam: The mods have basically approved it — this guy DM’d his accountant information or something, so they verified that he’s as wealthy as he claims. In the beginning thread he says: I’m worth north of $100 million. I got wealthy originally because I was an employee at a tech company that made me $30 million — that was about 15 years ago. Then I invested in this, and did this, and did this. And I’m going to answer a lot of the questions people ask here.
He covers: work and purpose, his time and routine, why he keeps a low profile, how relationships are complicated, what he spends on a monthly basis, and what his investment portfolio management looks like.
Shaan: It’s incredibly fascinating. I love this stuff — where you get behind the scenes of people you normally never have access to.
Sam: It’s a great series. It’s a great thread.