MMM net worth

[One]

I know that MMM is transparent about his budget. Just curious if he posts his net worth or how his investments have done throughout the years. Would be interesting to see how his stache has grown/compounded and also any investment mistakes he thinks he made or would have done differently.

[sol]

Like many high net worth individuals, his net worth seems very abstract.  It's partly based on his ability to generate future income.

There's the retirement accounts and piles of cash, of course, but those are the easy ones to count.  Then there's the real estate, both residential and commercial, which is harder to value.  And lastly there's the business, the corporate entity that contain the MMM blog and the construction work and the hq building and everything else.  Like the real estate, the business is worth whatever someone will pay for it, and what they will pay for it is typically some multiple of it's annual earnings or expected future earnings. 

Based on the numbers he's posted thus far, I estimate the the business is worth more than all of his other assets combined.  If he wanted to sell it, there are lots of blog-buying businesses out there that offer successful bloggers large up-front sums to take over ownership of the blog, usually with some conditions like keeping the deal secret, keeping the founder contributing on a semi-regular basis, and monetizing the pages for new revenue.  You can go read up on the history of Get Rich Slowly for an example of how that works, because that guy cashed a seven figure check and didn't tell anyone, but guest posts and ads started appearing on the site as he moved on to other things.  Perhaps relevantly, that whole process happened roughly concurrently with his divorce from his wife.

[patrickza]

He retired with +- $600k in the market and a paid off house earning $2k a month. That was probably 15 years ago, so his net worth went down in 2008 and then rocketed up.

Since launching the blog though he's making very big money, so he must be worth a very tidy sum at the moment, but doesn't disclose that.

For the amount of good his blog does to so many others I think it's very well deserved.

[talltexan]

I remember having my eyes open about what net worth really is by this article: https://slate.com/business/2018/07/kylie-jenner-net-worth-shes-not-a-billionaire-but-not-not-a-billionaire.html

Assets are ultimately worth what they can generate in income. Some assets can take additional money or energy now to become bigger later. The same rental property would be worth more to someone with the skills to manage it efficiently than to someone else.

I do not think the MMM blog is worth as much to any buyer as it is worth to MMM.

[Cassie]

I don’t see him giving up control of the blog.  It makes a lot of money with little effort required.  I think it’s helped many people.  I bet he never dreamed it would be so successful.

[trollwithamustache]

At what point does net worth become irrelevant? Lets say the internet is right and MMM lives on 50+ k a year instead of sub 30k.  He's got fun income at easily 4x that burn rate.  So... is his withdrawal rate is pretty negative.

[maizefolk]

I don’t see him giving up control of the blog.  It makes a lot of money with little effort required.  I think it’s helped many people.  I bet he never dreamed it would be so successful.

I agree. But leaving aside MMM, people with an asset that makes lots of money with little effort still sell them all the time.

Generally it will be in cases where you find you suddenly need a big chunk of money right away, so you sell your future stream of income at a discount to bring the money into the present.

I didn't follow GRS, but based on what sol describes, that might be an example of a case where the guy needed a bunch of money now either to support himself after splitting assets with his wife, or the divorce decree involved dividing the value of the GRS blog as an asset and he didn't have enough money to buy out her share of the value of the asset, so they sold it and split the sale price, same thing that often happens to jointly owned houses in divorces.

Another reason to sell is that all small businesses (which advertising supported blogs are) are inherently risky. A bigger company with multiple revenue streams might value a website with a 50% chance of earning $500k/year for the next 10 years at a higher level than an individual, because they can buy 10 such websites and some will succeed and some will fail, while for an individual who owns only one website the risk of failure is bigger. To see this for yourself, imagine someone offered you either $2.5M or a mystery box with either $0 or $5M in it. Which would you chose? I'm assuming that, like me, you'd pick the $2.5M. Now imagine it's $2.4M or $2M. At what point would you select the mystery box over a guaranteed payment?

And again, none of this is particularly relevant to Mr. Money Mustache (the person or the web property). I just like thinking about how people make decisions in situations like this.

[WhiteTrashCash]

Pete's net worth is so high that he can afford a really sweet bicycle. That's all we really need to know about it.