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“It’s hard to take risks if you don’t have a safety net”

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Re: “It’s hard to take risks if you don’t have a safety net”

#291

Post by gist »

snowwrestler wrote: post #159

PG seems worried that tweets saying you have to be rich to do a startup will discourage non-rich folks from trying a startup. This doesn’t give those folks much credit. It implies that a few tweets will have a bigger impact on their decision-making than their own detailed understanding of the constraints and anxieties of their own lives. I don’t think PG is in a good position to understand those constraints and anxie…

> I don’t think PG is in a good position to understand those constraints and anxieties. And he is somewhat incentivized not to, since YC benefits from having more startups to choose from. But YC does not experience significant downside on the startups that they reject or which fail. Unlike: the founders of those failed startups.

Exactly. And I have been avoiding saying this but keep in mind that from what I remember PG got the idea for YC when he was 'walking through Harvard Yard with Jessica'.

https://www.fastcompany.com/3002810/aha-moments-made-paul-gr...

All VC's are like this by the way. Even though they know there is a great chance that many ideas they fund will not work they still push the investments because it's not their mess to cleanup. That said there is actually probably more downside for employees. After all a founder with a big startup failure has been marked as someone 'in the mix' and can usually parlay that to other opportunities. Look at even Sam Altman and what happened after Loopt.

https://en.wikipedia.org/wiki/Loopt

Then he goes on having made his mark to running YC.

Re: “It’s hard to take risks if you don’t have a safety net”

#292

Post by nemonemo »

A close cousin of this topic would be the background of new full professors in major universities. Ph.D. is risky, especially considering the slim chance of getting the full professorship and its tremendous opportunity cost. The competition to become a full professor in a major institution is fierce and also it takes longer and longer as the competition heats up. The path is quite comparable to that of the unicorn founders in many ways.

I'd wonder how much study has been done around the socioeconomic backgrounds of those prominent professors. I'd also be interested how those backgrounds have been shifted as time goes by. It would be also interesting if not much research has been done about it when some of them are supposed to do such a thing.

Re: “It’s hard to take risks if you don’t have a safety net”

#293

Post by kstenerud »

throwaway55554 wrote: post #158
kstenerud wrote: post #102

It's easy to take risks when there's little to lose. If the only fallout is wasting some family money and at worst delaying your entry-level career by a couple of years for some experience that many employers consider valuable anyway, there's little downside to throwing the dice.

> It's easy to take risks when there's little to lose. > If the only fallout is wasting some family money and at worst delaying your entry-level career by a couple of years for some experience that many employers consider valuable anyway, there's little downside to throwing the dice. This, in no way whatsoever, resembles the conditions of the poor.

That's right. It doesn't.

Re: “It’s hard to take risks if you don’t have a safety net”

#294

Post by turk73 »

cbanek wrote: post #108

Pretty disappointed in PG's response: "I would ordinarily just let your bullshit go, but this myth that you have to be a rich kid to start a startup is terribly dangerous, because it discourages people who aren't from trying it. Brian Chesky's parents were social workers. That is not a rich kid." As if having two parents with stable jobs isn't considered a safety net. I agree, you don't need to be rich, but I also ag…

But it's true--I grew up very blue collar and had a crappy home life and failing meant having to go back to people who abused and belittled me. Thus, I could never afford to fail because the mental fallout of that would have been too big of a price to pay. I'm sure lots of people have this situation, it didn't feel that unique to me.

Re: “It’s hard to take risks if you don’t have a safety net”

#295

Post by vonmoltke »

vostok wrote: post #257
radcon wrote: post #247

Earlier quoted context omitted.

Average starting salary for CS undergrads today is $57,000. He did say "entry level dev gig". If you live alone in a major city, have student loans, and don't have great healthcare benefits from your employer, you'd be lucky to save much of anything on that salary. Banking $10k is a pipe dream.

At UMD, a good but normal state school, that figure is a little above $85k. I would be surprised if the $57k figure was accurate for people living in major cities. I would also be surprised if the average CS graduate is competitive enough for roles in major cities. The most desirable roles are only going to be realistic for the most qualified candidates.

> At UMD, a good but normal state school, that figure is a little above $85k.

That is probably inflated by many grads getting jobs in NoVa, which is not exactly cheap (unless you want a hellish commute).

Re: “It’s hard to take risks if you don’t have a safety net”

#296

Post by turk73 »

nichos wrote: post #156
ldoughty wrote: post #150

Earlier quoted context omitted.

Totally agree. I have great ideas of things to work on, but I'm essentially a single income household (my wife is in grad school, and her part time pay barely covers her education and school). I can't quit my job and work on a dream venture, who will pay for my wife's upcoming childbirth and related expenses? Who will ensure we can still make payments on our home and food? Living with parents is definitely a safety n…

This may come off rude, but I certainly don't mean it to be, but you have a choice to make. It sounds like you're chosing to have a kid and your wife go to school. If you want to do the startup, skip the kids, have your wife work and support you while you do the startup. Not everyone can have everything.

Here's a little tip: The wife and the kid are far more enriching than anything else you will do in life. So don't jeopardize them.

Re: “It’s hard to take risks if you don’t have a safety net”

#297

Post by kirillzubovsky »

bryanrasmussen wrote: post #4

I think if Paul G. came out a little less strong at the beginning - without 'bullshit' - this wouldn't be an issue. On the other hand there is the habit nowadays of having to guard and specify ones statements zealously in order not to get called out for something a reasonably lenient reading would allow, but calling something 'bullshit' probably doesn't get you into that other hand category.

Conveniently I just heard this on a podcast, and it's called "escalation of commitment." Basically, people hate to be wrong in public, and the more public person you are, the harder it gets. So instead of admitting a fault, they double-down on what's obviously a false statement.

Details from the podcast -> https://smashnotes.com/p/this-is-your-life-in-silicon-valley...

Re: “It’s hard to take risks if you don’t have a safety net”

#298

Post by dyarosla »

fucking_tragedy wrote: post #248
dyarosla wrote: post #230

Earlier quoted context omitted.

Depends where you live? Hard to say what diff people in diff situations and in diff places need and/or consider a safety net.

$10k barely covers the premiums + deductible for a health insurance plan on the individual market, or god forbid, COBRA. A safety net should cover expenses if you lose your job, which means losing your health insurance.

You seem to assume US.

Re: “It’s hard to take risks if you don’t have a safety net”

#299

Post by SeanAppleby »

blacktonystark wrote: post #260
SeanAppleby wrote: post #206

Earlier quoted context omitted.

For better or for worse, VCs need heuristics to filter the likelihood of you pulling off what you're claiming you can, and prestige and depth of education is one of those factors, as well as employment history which also selects on those education factors. An associates from a community college isn't going to get you a meeting with a VC, nor is it going to get you past the resume screen at google to run around the ed…

So, to put simply, VCs are only interested in those who already are full of multi-generational advantages and privileges built off the poor. No wonder startups are bascially for white guys only.

They're interested in making money, not providing a social service. There's certainly a problem there, but it's not the VCs' responsibility.

You are more likely to succeed in your business if you have the experience of building scalable systems, like at google, and if you have a similar friend group to recruit talent from, which is extremely hard at an early startup unless you already know the kinds of people you disproportionately meet at top universities and tech companies, and if you have family/friends that can help you out while you're struggling at the beginning of the startup, etc.

You are less likely to succeed if you have the financial encumberances that are common outside of the upper middle class, or if you have an unstable family structure that leans weight on you, if you don't have a safety net to lean on to get you through rough periods without personal income, and if you don't have the kind of network that a top school, top company, or connected family brings.

I came from a working class background, taught myself how to build products, made my own connections and raised some money for a startup and had to leave and return the money because there was a nonzero chance I'd have to adopt my nephew to keep him from the foster system, and couldn't possibly do that with the hours and volatility of that game. It is perfectly logical to avoid startups that have those kinds of additional risks when the game is already risky.

We absolutely should try to assuage those biases to improve economic mobility, but the answer isn't just to yell at VCs for trying to make money.

Re: “It’s hard to take risks if you don’t have a safety net”

#300

Post by TheCoelacanth »

vostok wrote: post #257
radcon wrote: post #247

Earlier quoted context omitted.

Average starting salary for CS undergrads today is $57,000. He did say "entry level dev gig". If you live alone in a major city, have student loans, and don't have great healthcare benefits from your employer, you'd be lucky to save much of anything on that salary. Banking $10k is a pipe dream.

At UMD, a good but normal state school, that figure is a little above $85k. I would be surprised if the $57k figure was accurate for people living in major cities. I would also be surprised if the average CS graduate is competitive enough for roles in major cities. The most desirable roles are only going to be realistic for the most qualified candidates.

UMD is ranked in the top 50 for CS[1] (out of thousands). It is a top-tier CS program, not a normal one.

[1] https://www.niche.com/colleges/search/best-colleges-for-comp...

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