Classic PG. Summary / TLDR: https://www.kontxt.io/document/d/q4Jpm8Kft2ZNa5I5wzdNonRuaCF...
How People Get Rich Now
401–410 of 941 posts
Re: How People Get Rich Now
#402Earlier quoted context omitted.
> but I suspect you are much more likely to build wealth with the more established tech companies FANG: low variance + moderate reward vs ENTREPRENEUR: high variance + high reward The Kelly Criterion can probably be applied here on how much to "invest" in each opportunity. Ultimately it matters how often these opportunities come up.
When you use the phrase "reward", are you talking expected value? Or top of the distribution? Because if it's expected value, I doubt "entrepreneur" is high reward compared to FANGs "moderate reward".
Yes, EV. I certainly think tech entrepreneurs go into a startup opportunity impassioned by their ideas, but knowing they could IPO or exit at some point in the future for a sizeable amount of cash is certainly a motivating factor.
EV = Probability * Outcome
Probability is very low of an IPO outcome - but EV is probably still higher than FANG work.
Re: How People Get Rich Now
#403Earlier quoted context omitted.
Over 25 years, I worked for 4 startups, 2 pre series A, 2 series A. All were VC funded, high growth, successful. 3 were acquired; 1 stayed private. I worked for startups because I really wanted to “get rich”. And, I put way too many hours in trying. In the end, I did get moderately rich. But, honestly, it was mostly from saving and investing well, not from exit events. Unless you play the political game, I doubt you’…
I have a similar background, and also miss the 90s where the people playing with tech were not thinking about the money but actually enjoyed the coding. What I find hopeful about Paul's essay and the current state of the world is that I can start my own company for next to nothing. And I only have to find a couple customers to cover my living expenses. I'm not going to be the CEO of a billion dollar company and that…
Not sure about that. Let’s say you have 10x cheaper tools, but 1000x more competition can you still make it?
Re: How People Get Rich Now
#404It's an interesting read, and not entirely new information, but I find this leap pretty unconvincing: > So it's not 2020 that's the anomaly here, but 1982. The real question is why so few people had gotten rich from starting companies in 1982. It seems more likely to me that industrialization and mass-production in the late 19th century, and information technology in the late 20th century were inflection points at wh…
Sweden's wealth Gini coefficient is the 4th highest in the world though. US is at 5. Asset distribution is very unequal in Sweden. https://en.wikipedia.org/wiki/List_of_countries_by_wealth_eq...
That's an interesting point, thanks. I only looked at income...
Re: How People Get Rich Now
#405It's a classic PG article. Many true facts in there, lots of good analysis with just a few questionable claims thrown in here and there. At the end, there's a massive claim that isn't fully stated but implied. "Of course the Gini coefficient is increasing" translated means "income inequality is not a problem". Firstly, Gini coefficient is based on income, not wealth. That isn't stated clearly. Secondly, there's absol…
Paul Graham's articles always shoot immediately up to the top of HN, but I agree with you, they're generally cursory and pithy thoughts which don't convince my skeptical mind. I don't know, can someone explain why his work is so popular? Think of all the amazing writers across our civilization whose work is linkable, and we're worshipping these decent but not amazing blog posts?
He is rich, and makes people rich. All the kids starting their tech company want to suck up to the man with the golden touch.
Re: How People Get Rich Now
#406Earlier quoted context omitted.
When you use the phrase "reward", are you talking expected value? Or top of the distribution? Because if it's expected value, I doubt "entrepreneur" is high reward compared to FANGs "moderate reward".
Yes, EV. I certainly think tech entrepreneurs go into a startup opportunity impassioned by their ideas, but knowing they could IPO or exit at some point in the future for a sizeable amount of cash is certainly a motivating factor. EV = Probability * Outcome Probability is very low of an IPO outcome - but EV is probably still higher than FANG work.
Yeah, I don't think that is true.
Re: How People Get Rich Now
#407Earlier quoted context omitted.
Can I ask a related question? Why all the focus on income/wealth "inequality"? Shouldn't we be looking at the absolute baseline quality of life? Hasn't it been increasing dramatically despite increasing inequality? Due to technological advances, hasn't the baseline quality of healthcare, education, sanitation, nutrition, shelter, comfort, convenience, etc. significantly improved from the 60s or the 80s? If so, why be…
>Why all the focus on income/wealth "inequality". Shouldn't we be looking at the absolute baseline quality of life? Hasn't it been increasing dramatically despite increasing inequality? Due to technological advances, hasn't the baseline quality of healthcare, education, sanitation, nutrition, shelter, comfort, convenience, etc. significantly improved from the 60s or the 80s? If people are feeling more volatility, and…
> If people are feeling more volatility
Do you think this feeling is reflected in actual risk though? If so, how would you quantify it? If not, shouldn't we expect/teach people not to feel so volatile and be more grateful and content?
Re: How People Get Rich Now
#408Earlier quoted context omitted.
The use of Airbnb seems odd to me. People around the world use it because they don't like the alternatives. Why shouldn't they be allowed to do business?
Could you point out where my comment implied that they shouldn't be allowed to do business? I didn't mean to (and don't believe that) so it would be helpful to see how I could adjust the way I communicate this. They should be allowed! It's just that maybe we need to adjust our society to this reality.
I think the language of the post was rather hyperbolic; I have quoted this line a few times now:
> But this level of wealth concentration and inequality is detrimental to the fabric of a society. We’re not better off, we’re not more innovative, we’re not healthier or more cohesive or happier when this happens.
When you give Airbnb as an example, I fixated on them mostly because it doesn't jive with the rest of your point.
So Airbnb is part of a group of companies in one geographic area that happen to be successful. Why does it matter? Should we choose to not do business with them, for the sake of geographical monetary equity? Whether group fiat or government breaking them up, it is the same result.
Sorry if all of this came off as too aggressive. It is monday, and I have had too much coffee already :/
Re: How People Get Rich Now
#409Earlier quoted context omitted.
> actually, people having or making different amounts of money is inherently wrong” (war on inequality). This is a misrepresentation though. There isn't anything inherently wrong with people having or making different amounts of money. The complaint, as I see it usually, is that the degree of inequality is unacceptable. That is, millionares aren't inherently unethical, heck people who make millions annually aren't in…
> The key issue is that personal wealth, after a point is wasted. Creation of vast personal wealth doesn't really serve society ... How much do you really care after your second billion anyway? What do you think the billionaires' billions are doing? Sitting in a bank account? I think the majority of their wealth is invested , i.e. it is funding industry, which is a good thing. If we assume for illustration that billi…
"Its invested" can mean a lot of things. And in general (as another user notes) the velocity of "invested" money is lower than the velocity of money spent. In other words, the 1T spent on jets is actually better for the economy.
Invested money is usually in things like the stock market, which doesn't directly support a company (buying a share of AMZN doesn't put money in Amazon's pocket, although it does, amusingly, make Bezos wealthier on paper). Angel investing might actually be better here from a velocity perspective, I don't actually know for sure.
Re: How People Get Rich Now
#410Earlier quoted context omitted.
There's a cycle with blogs. The author starts a blog and they have a distinct, somewhat original voice with distinct, somewhat original views. In PG's case, the startup advice about building stuff that doesn't scale, not worrying about competitors, Lisp, etc. were quite fresh, at least to me. The author's blog becomes successful and their ideas become well understood throughout a community. But a person's ideas don't…
> No offense, but I trust PG's advice on startups a lot more than his advice on macroeconomics That's the key bit for me. I've found his writing about startups, software, hacker culture, product development, etc. to be mostly great and informative. But whenever I see anything he writes about society as a whole, I tend to find the conclusions he draws to be pretty out of line with reality, or at least (in the cases wh…
Unpopular opinion: this is similar to Stephen Hawking's gloomy predictions for AI