From Outsourcing Your Life to Full Automation

October 21, 2015 Like many others, My Tim Ferriss obsession started after his book ‘The 4-hour Work Week’ came out in 2007. Initially, I was skeptical. These "self-help" or "productivity" books all seem like a waste of time. I didn’t need to be motivated, I understood the importance of time and ambitions at an early age. It was not until a few years later that I realized how much impact this book had on my life and shaped the way I think.

I was just starting my professional career then, and just beginning to understand the money/time tradeoff. The prospect of a "muse" or passive income business immediately caught my eyes. There’s a way to get out of the infinite cycle of trading my time for money? Sign me up! In his book, Tim discussed quite a bit about his experience of replacing himself with a system — an outsourced system, consisted of people overseas who are significantly cheaper in labor cost. Outsourcing was not a new concept, however, this was personalized, customized, revolving around one person’s needs.

As my consulting business started to take off a few years later, I couldn’t wait to start creating my own "outsourced self." Initially, I followed Tim’s methods. However, as an engineer, my obsession for efficiency and my natural curiocity gradually took over and I ended up with my own set of ways. In this part of the post, I’ll discuss my experiments with Tim’s teachings and lessons learned:

Tim’s Method 1: Outsource Busywork

For virtual assistants (VAs), I experimented with a few elance-like services. At the time, the price ranged from $3-15 usd/hr . I interviewed about half a dozen of VAs and negotiated a deal with a lady from the Philippines for $30/week. She ended up being a great asset for me, mainly for placing a lot of outbound phone calls. I set up a VPN in the states on an old laptop and she was able to use a google voice number to call for free.

However, as time went on, I realized a few things I dislike about this setup:

I have less and less of work for her to do. I realized I couldn’t trust her with the more sensitive information of my business, which prevented her from being too effective. I tried time-sharing her time with another contractor friend of mine, but even that couldn’t keep her busy.
Lot of instructions required. Sometimes, the time cost of writing up a clear set of instructions simply doesn’t make sense. I ended up doing lots of the busywork myself.
Upfront time cost. Like any other hiring decision, usually it costs quite a bit of time and energy to do the initial digging.
Virtualness means far. In practice, a lot of the assistance work I needed required physical proximity. For example, I found myself needing/using taskrabbit or food delivery services way more when they became available in SF.

Tim’s Method 2: Outsource Research

For consulting businesses to survive, lead generation is critical. You have to maintain a constant stream of clients, then you can start to expand.

Sourcing via Linkedin. Linkedin is the center for professionals on the interwebs these days. I had my VA look through some of the less tapped industries and gather important decision makers’ information onto a spreadsheet/csv file. Since software is eating the world, any industry can use my service. I’d rather explore industries with less exposure to tech.
Résumé’ing on all hiring websites. This is pretty straightforward: my VA helped me fill in job applications.. everywhere.
Interfacing with recruiters. Recruiters have a bad rep in tech due to high placement fees and constant phone/email harassments. I came up with an alternative fee structure and my VA helped me turned the table and spammed lots of recruiters.

At the time, I also wanted to explore real estate as an alternative passive income opportunity. Lots of the research and analysis in housing prices, buy/rent ratio, cost of living, and quality of living in different LoI (locations of interest) were done by my capable VA.

Tim’s Method 3: Outsource Actual Work

It’s been a while since I read the ‘4 hour workweek,’ but I believe there was a whole chapter in his book about how the chapter was actually written by people overseas. For my software consulting business, however, I’ve always been against outsourcing. I think we are in an industry where reputation and quality of work matter way more, I almost always get better clients from word-of-mouth referrals than cold calling. The only tasks I used my VA for were general communications and customer on/off boarding (schedule meetings, receive feedback etc.).

Additional thoughts

Even though Tim Ferriss’ outsourcing approach is a great life/productivity hack, there are quite a few downsides. The problem with humans in general is that they are harder to manage. They are:

Less predictable: people move on to other jobs and they get sick. As an employer, you have to constantly have a backup in mind.
Requires repetitive training: depends on the person, you have to invest a lot of time training and correcting your employee(s). With every new person that comes in/leaves, you have to start the process all over again.
High upfront cost: both in terms of training (onboarding) and opportunity cost (possible better candidates in the future)
Domain expertise: sometimes, the jobs are simply too technical that it’s impossible to prepare someone in a short period of time.

This is why I believe computer-driven automation is the natural sequel to Tim’s human-powered automation. It’s cheaper, more reliable, more scalable, and to an engineer’s perspective, more adaptable.

In the next part of this post, I will discuss my modified system, a completely computerized system, that currently runs >80% of my life. I will discuss the technology stack I personally use as well as the cost analysis in terms of time and money I spend maintaining my servers and writing code.