Since moving to the heart of Silicon Valley, I’ve been impressed with the world of startups, investors, and the general get er’ done attitude of everyone around. It’s been exciting and adventurous to rub shoulders with some of the top leaders of the tech industry; and I’m sure there’s lots to come.

It seems that the pleasantries exchanged while meeting a new person these days almost always include a few questions about where they work, what they do, and who their investors are.

You are an Investor

Every day, each person makes decisions about how to spend their time, their money, their talents, and their resources. Every decision is quantified by the expected return - and in the end, hopefully more is gained than is lost. That time hacking apart monsters in Diablo 3 had better count for something.

Think about your Job: Most everyone will risk eight hours in a single day to that investment. Sometimes twelve or fourteen. Compound the time you spend commuting to and from work, the endless coffee breaks and co-worker chats, and pretty soon half of all your portfolio (time) is risked in a single investment.

If you’re a freelancer, what do your clients look like? How much time are you spending per client relative to your return? Is the a disparate relationship between time spent and return between each of your clients?

Quantify your Risk

These questions are at the heart of quantifying the risk taken each time you throw on your backpack and roll into work. If you have a full-time job, what do your options look like? Are you working by the hour, for a vague pipedream of equity, or can you actually quantify sticking 50% of your eggs each day into a single basket.

During the ebb and flow of life, it’s easy to lose track that a job isn’t just a paycheck - it’s a mutual investment from both parties to (hopefully) make each other copious amounts of money, while furthering the company’s (and if all is well aligned, your own) ambitions.

Be consistently aware when you wake up each day, that over the next twenty-four hours you’re risking X amount of them to a single investment.

Measure your Returns

Having good investments in place is all well in good, but with something as immaterial and transient as time, how can you take accurate measurements of your investment? Well, the best way is to define what you’d like to see in advance. Write it down. Refer to it often. Use that goal to compare all your business decisions with. Here’s a sample of just one of the goals I created at the start of 2011 while mid-way through a two year run of freelancing:

I want to “Increase lead count from all venues from X to XX per month.”

Through a few measured attempts, I saw a dramatic increase in my monthly requests to the point where I had to set new goals based around filtering out requests, and taking on less work from better people.

Whatever gain you’re using the quantify the risk you take for the job-time investment, make sure that it’s measurable and reported.

Drop bad Investments

On the spectrum of investing, this is perhaps the most ambiguous and difficult to master. When is it time to cut ties and end a relationship? Well, patently, it’s when your measured return is not equal to or greater than the quantified risk.  As blatant as the answer is, execution is immeasurably more difficult.

When the moment comes that you know your time is being poorly invested, make immediate steps to correct the mistake you made. Heres a general rule of thumb: if you woke up today, and didn’t want to go to work, you’ve probably made a bad investment.

Here’s to all of us making good investments with our time.

Cheers.