A business owner I know recently told me that, instead of giving his money to his kids when he dies, he plans to give it all to charity.

Another entrepreneur I know of (let’s call him a friend of a friend) has hundreds of millions in the bank. He spends it on yachts, cars and minor league sports franchises. He has more money than most of us would ever want or need, yet he is miserable.

I think we’d all agree that having enough money to do the things we want to do is important, but is there a point where too much money is a bad thing? Is it possible the marginal value of money is actually negative? If the answer is yes, what implications does this have for how big you want your company to get or how long you’re willing to run it before you look for an exit?

Let’s test this idea.

Imagine you and your family have just arrived in a new country with not much more than the clothes on your backs, and some kind soul hands you a check for $100,000 and tells you it is yours, no questions asked. One hundred thousand dollars would be enough to buy winter clothes for your kids, get food on the shelves, and buy you a computer and suit so you can find a job. You could get a place to live and fund the necessities of life while you get established into a job or your business gets off the ground. How life-altering would that $100,000 be? On a scale of 1 to 100, I’d imagine it would be close to 100.

$500,000 – $1,000,000

Now let’s say you have worked hard and built up a nest egg of $500,000, and someone hands you a check for $500,000. Wow, half a million dollars. Most people would blow a bit and use the rest to pay down their mortgage. Five hundred thousand dollars is a great windfall but not necessarily as life-altering for you as the $100,000 would be for the newcomer, even though the check is five times bigger.

$5,000,000 — $6,000,000

Now let’s say you’ve been wildly successful and have made it into the top 1 per cent wealthiest people in the country. Your net worth is $5-million; your house is paid for; the kids are through college. And someone hands you a check for $1-million. A great gift to be sure, but would it change much? Maybe it would give you an extra bit of safety, an opportunity to travel a bit more or buy another property, but I’d imagine the $1-million check would not make much of a difference to your overall life experience, even though it is ten times the size of the check the newcomer got.

$20,000,000 – $120,000,000

Finally, let’s say you have $20-million. With $20-million, you have enough money to fund the whim or fantasy of any normally adjusted person. What if someone gives you a check for $100-million? Now what? Would the extra $100-million be worth the hassle? What if you followed the stereotypical pattern of most people who quickly accumulate that kind of money: buy a yacht or a second (or third) home so you can “escape” your 20,000-foot primary residence; throw lavish parties and invite important people. Would people start noticing all of that money and figure you’ve got a lot to throw around? Would someone steal the Ferrari out of your driveway? Would you start to worry more about security? Would your kids become spoiled brats? Would you strive for bigger and bigger purchases looking for that high you first achieved when you were starting out? Would you get overwhelmed with the added complexity of maintenance contracts, more staff, more lawyers and managers and paperwork?

Would life be better with $20-million instead of $120-million? How about $5-million instead of $20-million? What about $1-million instead of five? How big do you want your company to get before you sell it?

What is the number at which you optimize the benefits of wealth without all of the nasty side effects? How much would someone have to offer you for your business in order for you to walk away? Or do you love your business so much you’d be willing to run it—like Vikram Pandit of Citigroup did in 2009—for $1 a year?

What’s your best before date?

Here’s a video describing the trigger that caused me to want to sell my latest business:

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