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Entrepreneurs don’t have a gene for risk – they come from families with money

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Re: Entrepreneurs don’t have a gene for risk – they come from families with money

#151

Post by dionidium »

alexfisher wrote: post #86

Step 1: Spend less than you make. Step 2: Take risks when you have enough of a safety net. Step 3: Fail/retry or succeed. You don't need to be from a rich family to do these things.

You don't need to be from a rich family to do these things.

Of course not. Who said so? The point is that coming from wealth increases the odds that you'll end up being the type of person who will follow that program. It's not simply about having the capital; it's what coming from a place where security is guaranteed does to your psyche.

Re: Entrepreneurs don’t have a gene for risk – they come from families with money

#152

Post by eugenekolo2 »

crdoconnor wrote: post #84
eugenekolo2 wrote: post #78

Earlier quoted context omitted.

I think it's quite different in the software startup industry. You usually don't need much capital, it's more that you need to have a failsafe in case you go bust to not end up unemployed and unable to pay bills.

>I think it's quite different in the software startup industry. You usually don't need much capital You still need a distribution channel. That requires either capital or connections.

Networking is still invaluable, but capital isn't a necessity in software startups. I do think that either bravery or a nesting egg to fall back on is though.

Re: Entrepreneurs don’t have a gene for risk – they come from families with money

#153

Post by notahacker »

patrickaljord wrote: post #104
notahacker wrote: post #56

Earlier quoted context omitted.

Peru might have a lot more entrepreneurially minded people, and more self-employed people but France certainly has more successful tech startups (even on a per capita basis). Just as lack of a safety net biases towards action and self reliance, it also skews the risk/reward ratio of those actions firmly towards those most likely to keep the roof over ones head.

The reason there are more tech startups in France is because people are better educated.

True, but then arguably education (and especially several years of heavily-subsidised tertiary education) is part of the safety net, and the safety net certainly contributes towards choice to pursue that education rather than accepting the first shitty informal sector opportunity that enables them to support themselves.

Obviously there are plenty of other social and economic differences between Peru and France, but the fact that even Peru's relatively small number of highly-educated people is still highly likely to be underemployed doesn't exactly speak wonders for the potential of all these entrepreneurially-minded Peruvians to actually create jobs.

Re: Entrepreneurs don’t have a gene for risk – they come from families with money

#154

Post by smoyer »

radmuzom wrote: post #11

Ten years back, when I was fresh out of college, I joined a startup - not as a founder but as the first employee. A lot of it was driven by reading Paul Graham's essays, and I was naive and immature enough to believe that I was doing something great (as an aside, I came from an economically disadvantaged family; and every cent of my assets today is something I have earned and not something which I have inherited or o…

Thirty-five years back, I went to work as the fourth person in a start-up (that's still in business) and loved the fast-paced environment of a start-up life. Fifteen years ago, I went to work for "BigCo", and while our group was essentially an internally funded start-up, I hated the politics, especially as we acquired other companies and tried to integrate their software products into ours.

The good news is that succeeding at three of the four start-ups left me with enough stock options to fund (my share) of my next start-up with cash. While it's looking like I may not see a return on that investment, the product was certainly something the industry needs/needed. As a small boot-strapped company, it's almost impossible to move an industry.

I'm currently working at a university and we've tailored the culture within our group to be much like you'd find in a start-up (the political machinations of a university can however be brutal). In any case, I think I have a couple more ideas that could be turned into start-ups and enough working years left to build a couple more start-ups. I can't think of anything that's more fun.

In contrast to you, I came from an upper-middle class family with a stay-at-home mom and a go-to-work dad. Things were comfortable when I was at home but I'd have never asked any of my relatives for money to create a start-up and my parents were far more risk averse than I (originally they mildly disapproved of the risks I was taking but seem to have realized I always "left myself an out" so that in the worst possible outcome, I could take care of my wife and kids).

So it might be true that most kids these days have the money to be entrepreneurs, I say it was definitely in my genes. (As an aside, in the '80s I think most of the start-ups I saw were people who were risking almost everything to get started because they had a vision - it's much easier to fail if there are no consequences).

Re: Entrepreneurs don’t have a gene for risk – they come from families with money

#155

Post by logfromblammo »

bakhy wrote: post #89
aianus wrote: post #68

Earlier quoted context omitted.

No, that's if you take home $100k and 'only' spend half of it (which already represents the median household income in the US)

OK, but how many developers in the US get $100k? Throughout the first 10 years of their career? And I'm sorry, I should explain - I live and work in the EU, in Germany right now. So I can't compare. In any case, one can certainly save, and I'm not gonna lie, I could certainly spend less without losing too much :) But a claim like "10 years is enough to retire" seems a bit extreme.

You can consistently get $100k in Silicon Valley, New York City, and Washington DC Metro, although you will need Top Secret security clearance for the latter.

It should come as no surprise that the expenses in those areas are much higher. If you settle for a lower salary in an area with lower living expenses, your effective savings rate could be higher.

Also, you don't want those DC jobs. Just say no. The military industrial complex is a soul-eating machine, and it does not respect software professionals.

The problem is that other places have fewer available jobs in the field, and a greater proportion of them are extremely unglamorous. $90k maintaining a stupid, business-line CRUD app may be less attractive than $80k making custom software for medical researchers.

Re: Entrepreneurs don’t have a gene for risk – they come from families with money

#156

Post by rebootthesystem »

karambahh wrote: post #142
rebootthesystem wrote: post #109

I'm sorry, I am going to call this nonsense. I am second generation from immigrants who arrived at these shores with nothing but the clothes on their backs. They escaped Genocide and other horrors. When they got here they grabbed whatever job they could. They had nothing. They saved their money. And when they could, they started their own small businesses (yes, both of my grandparents behaved the same way without kno…

Although your parents built their business from scratch, they benefited from a social, cultural and economic background which led them to more easily attempt and succeed at starting a business. I am a business owner myself, not coming from a high-income family. I am now part of a network of young entrepreneur/lending scheme for innovative business. A wild guess: 75% of our alumni come from privileged environment: 50%…

I think our scale and perspective, by being in tech, can be skewed.

Over 540,000 new businesses are started EACH MONTH in the US. The sheer number of them should be evidence enough that the vast majority are not started in the context of privilege, wealth or perhaps even a safety net that protects the would-be-entrepreneur from failure. I just don't think this world view is correct.

http://www.forbes.com/sites/jasonnazar/2013/09/09/16-surpris...

While it is hard to find this data, the following article claims that "472 million entrepreneurs worldwide attempting to start 305 million companies, approximately 100 million new businesses (or one third) will open each year around the world."

That's one hundred million businesses per year world wide launched by nearly half a billion entrepreneurs. I think we can agree there aren't that many wealthy families or entrepreneurs with "I can fail without consequences" safety nets in the world.

http://www.moyak.com/papers/business-startups-entrepreneurs....

Re: Entrepreneurs don’t have a gene for risk – they come from families with money

#157

Post by jmzbond »

This is also why I think people should be very careful before comparing two entrepreneurs, or saying something like: "why is ___ so much less busy than you and more successful?"

Well, because ____'s parents are literally billionaires. I have to work so much harder because my bank account is actually decreasing everyday!

Re: Entrepreneurs don’t have a gene for risk – they come from families with money

#158

Post by Terr_ »

alexfisher wrote: post #86

Step 1: Spend less than you make. Step 2: Take risks when you have enough of a safety net. Step 3: Fail/retry or succeed. You don't need to be from a rich family to do these things.

> You don't need to be from a rich family to do these things.

P(became_successful_entrepreneur|was_poor) > 0.0000000000

A technically-true statement, but not a useful one.

Re: Entrepreneurs don’t have a gene for risk – they come from families with money

#160

Post by api »

ThomPete wrote: post #159

I wonder how that explains the fairly high risk averseness in the Scandinavian countries? It's literally safe to fail yet failing is frowned upon. I don't think that article is telling the right story.

Correct me if I'm wrong, but don't those countries have a massive amount of micromanaging regulations around things like employment practices?

If that's the case, that certainly will stifle entrepreneurship even if everything else is in line.

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