Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Teen Trades up on Craigslist from Phone to Porsche in 2 Years

mercurynews.com

Post reply on HN
Print view View original

21–30 of 57 posts

Re: Teen Trades up on Craigslist from Phone to Porsche in 2 Years

#21

Post by vannevar »

dpatru wrote: post #17

One of the points that Charlie Munger makes in his talk on worldly wisdom ( http://ycombinator.com/munger.html ) is that good investors tend to bet heavily when the odds are grossly in their favor and not bet at all the rest of the time. The teen in this story illustrates how consistent application of this principle yields good results. This is also how Paul Graham operates YCombinator: he carefully evaluates all the…

At this point in his career, the fact that PG is investing in them is by far the single most valuable thing about any of his startups, much more valuable than their respective business models. The businesses succeed because he invests, he doesn't invest because they succeed.

That doesn't mean any business model can succeed with funding, only that once you're funded you've got a lot more flexibility to adapt your business model to the reality of the market you engage and this flexibility makes you much more likely to be successful.

Re: Teen Trades up on Craigslist from Phone to Porsche in 2 Years

#22

Post by electromagnetic »

SkyMarshal wrote: post #15
lkozma wrote: post #12

Earlier quoted context omitted.

Is that what is called arbitrage ?

Not exactly. Arbitrage is exploiting mispricings of the same item in different markets. For example, say you buy an iPhone from Craigslist for $100, then turn around and sell it on Ebay for $150, netting you $50. Or conversely, you get an iPhone for your birthday for free, sell it on Ebay for $150, then buy a second one from Craigslist for $100, netting you an iPhone+$50. That's arbitrage. It sounds like makeramen's…

It's certainly the same market, however it's still hardly a level playing field. There's social niches, even in elementary schools, that people generally avoid drifting out of, however a nomad can drift between these niches and exploit mispricings in an individual market.

It's not so much changing market, but being a supplier who looks for clients who haven't met the other suppliers in the market. It wouldn't be arbitrage, but it would be a nice way of exploiting newbies in a market. Sort of how Bestbuy profiteers off of having a well recognized names whilst being far off from having the best prices (I bought a surge protector the other day that they were selling for $20 more than the place across the street, I was smart enough to bring the other stores flyer and got 10% off extra).

Re: Teen Trades up on Craigslist from Phone to Porsche in 2 Years

#23

Post by SwellJoe »

noelchurchill wrote: post #10
zokier wrote: post #8

Earlier quoted context omitted.

That sounds kinda crazy. 5-6 hours daily for two years could have easily earned him money to buy a Porsche, for cold cash.

That's what I thought. But I doubt he actually spends that much dedicated time. Rather he's probably multi-tasking, checking in periodically over the course of 5-6 hours. I bet he's mastered some important negotiating skills.

Yes, for a kid, this was probably an extremely valuable use of his time, and he seems to have had fun doing it. He probably learned more than he would have working a retail or service job, even if he made less money per hour.

My parents are antique dealers, and my grandmother was a junk dealer who owned a thrift store. I grew up going to flea markets and garage sales, and my first business was started when I was twelve (I bought broken Commodore 64s, Apples, and TIs, among others, at garage sales and flea markets, fixed them, and sold them for four to eight times what I paid for them). I worked at my parents store and in their booths at flea markets throughout high school. I'm a ridiculously good salesperson when it comes to interacting directly with a customer, and people are often amazed when they see me in that context because I'm an introvert in nearly every other situation.

In short, having the ability to buy/sell/trade your way up from nothing is an incredibly useful skill, and it can make it possible to weather bad luck in other aspects of life.

Re: Teen Trades up on Craigslist from Phone to Porsche in 2 Years

#24

Post by sigstoat »

SkyMarshal wrote: post #15
lkozma wrote: post #12

Earlier quoted context omitted.

Is that what is called arbitrage ?

Not exactly. Arbitrage is exploiting mispricings of the same item in different markets. For example, say you buy an iPhone from Craigslist for $100, then turn around and sell it on Ebay for $150, netting you $50. Or conversely, you get an iPhone for your birthday for free, sell it on Ebay for $150, then buy a second one from Craigslist for $100, netting you an iPhone+$50. That's arbitrage. It sounds like makeramen's…

depends on what you consider to be the market(s). the north and south sides of the playground might have rather different valuations of a card. if you can realize that and safely transport your goods that distance, you've got an opportunity.

Re: Teen Trades up on Craigslist from Phone to Porsche in 2 Years

#25

Post by eru »

SwellJoe wrote: post #23
noelchurchill wrote: post #10

Earlier quoted context omitted.

That's what I thought. But I doubt he actually spends that much dedicated time. Rather he's probably multi-tasking, checking in periodically over the course of 5-6 hours. I bet he's mastered some important negotiating skills.

Yes, for a kid, this was probably an extremely valuable use of his time, and he seems to have had fun doing it. He probably learned more than he would have working a retail or service job, even if he made less money per hour. My parents are antique dealers, and my grandmother was a junk dealer who owned a thrift store. I grew up going to flea markets and garage sales, and my first business was started when I was twel…

Perhaps it would have been even better for the guy, if he had traded in person?

Re: Teen Trades up on Craigslist from Phone to Porsche in 2 Years

#26

Post by eru »

SkyMarshal wrote: post #15
lkozma wrote: post #12

Earlier quoted context omitted.

Is that what is called arbitrage ?

Not exactly. Arbitrage is exploiting mispricings of the same item in different markets. For example, say you buy an iPhone from Craigslist for $100, then turn around and sell it on Ebay for $150, netting you $50. Or conversely, you get an iPhone for your birthday for free, sell it on Ebay for $150, then buy a second one from Craigslist for $100, netting you an iPhone+$50. That's arbitrage. It sounds like makeramen's…

> Arbitrage is exploiting mispricings of the same item in different markets.

There seem to be narrower and wider definitions of arbitrage. Some narrow definitions require arbitrage to be risk-free. Some wider definition accommodate things like statistical arbitrage (http://en.wikipedia.org/wiki/Statistical_arbitrage), which is far from certain and doesn't even use the same items, but just items with correlated prices.

Re: Teen Trades up on Craigslist from Phone to Porsche in 2 Years

#28

Post by eru »

plusbryan wrote: post #9
turnersauce wrote: post #6

This guy went from a paperclip to a house: http://www.oneredpaperclip.com/about/ . A couple of my friends actually got a barbecue from him off of Craigslist. Sadly, I think the transaction only involved money.

the red paper clip guy actually hired a pr firm to help him gain publicity and achieve his goal (I knew a guy at the pr firm he hired)

Seems like a legitimate tactic to me.

Re: Teen Trades up on Craigslist from Phone to Porsche in 2 Years

#29

Post by Unseelie »

InclinedPlane wrote: post #7
johnnyg wrote: post #3

It was alarming to read that people tell him he is a con artist. He's a good businessman.

He's a businessman, but whether or not he's good is a question for debate. Most people working the same hours have a higher income. Do the math, if the Porsche trade represents all of his "income" from bartering he made $3.6 an hour, if it represents half of his income then he made minimum wage. It's interesting, and somewhat novel, but hardly astounding or terribly impressive.

He's demonstrated being a pretty poor businessman. He's traded down, knowingly, on multiple occasions, and furthermore declined trades of businesses, which generate income, for cars, which depreciate.

Re: Teen Trades up on Craigslist from Phone to Porsche in 2 Years

#30

Post by eru »

jaytee_clone wrote: post #20

Five hours a day at $10/hr for two years could have earned him $30,000 (5x10x600, i'm sure he was bartering during weekends too) His car only worths $15,000.

The article estimates his current car (the Porsche) to be worth $9,000. (By the way, I always thought a Porsche would cost more, even used. Hey, I may get myself one for this price.)

We also don't know what other trades he has made during this time. Judging by the description in the article, he seems to be quite prolific, and has probably also made some money with refurbishing electric gadgets and so on.

And we also learned that he still worked at a sushi bar (but lost the job at some point in time). So he has quite a lucrative hobby, but still did a day job.

Post reply on HN