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Parents' income, not smarts, key to entrepreneurship

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Re: Parents' income, not smarts, key to entrepreneurship

#91

Post by JKCalhoun »

cmrdporcupine wrote: post #69
elliebike wrote: post #5

I suspect a large part of this is due to the fact that those with wealthy parents are more likely to have a) family money to fall back on if things go wrong and b) family investment in the early days Everyone else has to seriously consider the (high) risks of their startup failing and not being able to afford rent, or whether their idea is worth burning their life savings.

It's also highly cultural; if the people around you that you see as role models are serious about business, connections, management, etc. that's what you pursue. And higher management comes more naturally to people who have spent their childhood in an ethical framework that divides people into manageable units, too. My working class / middle class parents just didn't have room in their worldview for having employees,…

Wow, I just made this exact same point. You and I must have similar experiences.

Re: Parents' income, not smarts, key to entrepreneurship

#93

Post by PeterisP »

iguy wrote: post #58
epistasis wrote: post #21

Earlier quoted context omitted.

Rents only get pumped up if we don't have enough housing to go around... in which case regular incomes do the same thing.

But we do have lots of housing, it's just located in places people don't want to live. Rents are high in places they do want to be, and that's partly a positional thing -- if you want to live where the top-10% of earners live, you need to bid against them for housing.

Thing is, requirement for on-site employment requires you to live where lots of people live; only the very wealthy can afford to live in places without jobs nearby - as UBI decouples income from where you live, then it would be a pressure to equalize rents, as underemployed people - the demand for whose labor is decreasing and will decrease further - can afford live in the many places which are currently shedding population because of lack of jobs despite being actually very nice to live in.

Re: Parents' income, not smarts, key to entrepreneurship

#94

Post by medium_burrito »

umvi wrote: post #77
abhiyerra wrote: post #20

Earlier quoted context omitted.

Healthcare and Basic Income would do a lot to encourage entrepreneurship. I had to also wait till I paid off my student loans. There are a whole lot of shackles if you come from a humble background to starting a company full time. On the other hand it has never been cheaper to start a side hustle.

> Healthcare and Basic Income would do a lot to encourage entrepreneurship Would it though? From what I understand EU has way better social safety nets, yet much smaller entrepreneurship rates compared to USA. Counter-intuitively, limitations drive innovations. When your resources are limited, you are forced to innovate. When you have infinite resources, you tend to waste it. Ever notice that when you have infinite t…

China Lake's development of the Sidewinder missile is a similar story - minimal resources, compared to the vast amounts wasted on radar guided missiles that more or less didn't work until much later.

However, I think it's orthogonal. Limitations are good, but having a basic fallback is also good.

Re: Parents' income, not smarts, key to entrepreneurship

#95

Post by iso1631 »

dawsmik wrote: post #46

Middle class in the US goes up to about $120k. I dont know any licensed tradespeople that work for themselves that make less than this.

Electricians $50-60k: https://www.indeed.com/career/electrician/salaries https://www.salary.com/research/salary/alternate/electrician...

Plumbers: $60k https://www.salaryexpert.com/salary/job/plumber/united-state... https://www.salary.com/research/salary/alternate/licensed-pl...

Now those aren't self employed, but

"What Kind of Money Can a Self-Employed Master Plumber Make Annually?"

Suggest maybe 20% more for self employed

https://bizfluent.com/info-12088771-kind-money-can-selfemplo...

"The salary for a master plumber with more than 20 years of experience ranges from $43,790 to $74,700 a year"

Do you have any data rather than your self-selecting annecdote?

Re: Parents' income, not smarts, key to entrepreneurship

#96

Post by JKCalhoun »

iso1631 wrote: post #88
CalRobert wrote: post #49

One thing that confuses me, though - if having a strong safety net to fall back on is important to enable entrepreneurship, why does it seem like Europe is so bad at it?

Europeans may be more risk averse too -- perhaps more YOLOs in America because there's nothing to lose, where as in Europe you can still have a normalish life, but it's not just a strong safety net either though -- many unicorn concepts were done in Europe, but they didn't become big globally. Maybe the lack of VC to scale - a lot of money sloshing around in SF. Maybe there's less of an culture of thinking "my way is…

Your first point is interesting to me. I have a friend that made a crazy call on some stock options that seemed to me like 10 to 1 odds. When I asked him why he said essentially, it's the only way I'll ever have a chance to get rich.

I think a lot of Americans may be driven to entrepreneurship because, short of the lottery, it may seem to them the only way to climb the ladder.

Countries where life is a little more ... comfortable? ... may have fewer people willing to roll the dice (so to speak).

Re: Parents' income, not smarts, key to entrepreneurship

#97

Post by Lammy »

iguy wrote: post #58
epistasis wrote: post #21

Earlier quoted context omitted.

Rents only get pumped up if we don't have enough housing to go around... in which case regular incomes do the same thing.

But we do have lots of housing, it's just located in places people don't want to live. Rents are high in places they do want to be, and that's partly a positional thing -- if you want to live where the top-10% of earners live, you need to bid against them for housing.

The supply of housing in the places people do want to live is artificially constrained, intentionally driving up prices to achieve the New Segregation.

Re: Parents' income, not smarts, key to entrepreneurship

#98

Post by hogFeast »

Abishek_Muthian wrote: post #90
JoeAltmaier wrote: post #4

I've known this for decades. When Bill Gates started publishing Smart Basic (or whatever) in magazines, I got a copy and saw what crap it was. I could do better. Why didn't I? That was my very first thought. The reason was, I had to work halftime to pay tuition and buy food. I was mired in working to live. Ol Bill had a family to support him as he bought resources (ads in magazines etc), recruited staff, took meeting…

I knew Bill Gates's family was well to do when he started with his endeavors, but I recently came to know Bill Gates Sr. was a prominent personality from Howard Schultz's account of him. The story goes like this - When Howard was offered Starbucks for US$3.8 million by original founders, he was working to raise funds for that and his current investors went over his back to buy Starbucks. Howard was introduced to Bill…

Gates was also introduced to Warren Buffett through his dad.

Re: Parents' income, not smarts, key to entrepreneurship

#99

Post by ska »

umvi wrote: post #77
abhiyerra wrote: post #20

Earlier quoted context omitted.

Healthcare and Basic Income would do a lot to encourage entrepreneurship. I had to also wait till I paid off my student loans. There are a whole lot of shackles if you come from a humble background to starting a company full time. On the other hand it has never been cheaper to start a side hustle.

> Healthcare and Basic Income would do a lot to encourage entrepreneurship Would it though? From what I understand EU has way better social safety nets, yet much smaller entrepreneurship rates compared to USA. Counter-intuitively, limitations drive innovations. When your resources are limited, you are forced to innovate. When you have infinite resources, you tend to waste it. Ever notice that when you have infinite t…

> Would it though? From what I understand EU has way better social safety nets, yet much smaller entrepreneurship rates compared to USA.

This is definitely a multiple factor problem, and health care is just one of them. A couple obvious ones - social acceptance/rejection of this as a path, and government/financial friction. If you have only been exposed to the US, it's pretty shocking how hard it is to get a company up and running in many countries. One of the biggies is fairly direct access to capital with the right risk appetite, which itself is complex.

Re: Parents' income, not smarts, key to entrepreneurship

#100

Post by luigibosco »

Someone1234 wrote: post #86
war1025 wrote: post #32

Earlier quoted context omitted.

> Healthcare and Basic Income would do a lot to encourage entrepreneurship. I have a dream that Healthcare will someday be decoupled from employment. So much waste is tolerated simply due to the fact that the majority of the expense is borne by your employer before the number they put on your paycheck. I can live on a part time salary without issue, but health insurance, which is already $200/wk for my family with my…

They could even do this without too many major changes. Just three in fact: - Increase HSA Contribution Limit - Allow both Traditional & High Deductible insurance premiums to be paid with the HSA - Ban employers from directly providing/choosing insurance (ex. US Military) Essentially everyone goes out onto the open market and buys their insurance using pre-tax HSA contributions (similar to tax benefits to employers n…

You're assuming people have the money to contribute to an HSA and an employer when many do not.
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