Earlier quoted context omitted.
Exactly, pensions were considerably more common in the 1960s also, but at the end of the day, I don't really care if my retirement is actually funded by a pension or a 401k or by stuffing dollar bills under my mattress, I want to know when I can retire and how comfortably I can live when I retire. Yes, getting into the weeds is valuable, but here we're talking about the money in your bank at the end of the day, and t…
> why Because their decisions can drive a company into bankruptcy or transform it into a trillion dollar company. Your average line employee has no such leverage from their actions.
How People Get Rich Now
621–630 of 941 posts
Re: How People Get Rich Now
#622Earlier quoted context omitted.
Three problems: 1. Humans are humans, and they pretty much always judge their success by comparing themselves to others. Or, rather, humans are primates. Take a look at the famous study of the monkey that got cucumber while the other monkey got tastier grapes. 2. Income inequality in and of itself can be a problem because the mega wealthy can essentially buy laws that benefit themselves. There have been many studies…
> pretty much always judge their success by comparing themselves to others Yes but that doesn't mean this comparison has moral standing. Also this behaviour is pretty low-level, neurologically, and we can train our higher executive functions to override and disregard it. I would argue that should be the expectation. > can essentially buy laws that benefit themselves Again - so what? As long as everyone's lives are im…
1. Housing has become much more unaffordable.
2. Higher education has become much more unaffordable.
3. Retirement income has become much less guaranteed.
4. Employment is much less stable than it used to be.
Just look at the coming eviction tidal wave that will happen after the eviction moratoriums in the US end. Telling people "But look at all the other modern comforts you have now!" will smack as "Let them eat cake" when someone gets kicked out of their house, while the rich got much richer over the past year.
Re: How People Get Rich Now
#623Earlier quoted context omitted.
Stock based compensation goes to zero in bankruptcy.
Usually somehow the execs have sold out just before the bad news, while the regular employees haven't liquidated their 401s/stock plans.
That's called insider trading and those who do that ends up in jail or at best have to hide in the sun for the rest of their life.
Re: How People Get Rich Now
#624Earlier quoted context omitted.
A good example of that [0]. Amazon is quoted as saying that hourly employees prefer the "predictability and immediacy of cash to RSUs", and I imagine Amazon would prefer to give RSUs, so this is probably accurate. [0] https://www.theverge.com/2018/10/3/17934194/amazon-minimum-w...
an RSU is a massive tax problem, for one thing.
Re: How People Get Rich Now
#625Earlier quoted context omitted.
Actually, I think this is almost the perfect response to his article. It's not hard to imagine that a guy who made his fortune off of startups would be biased to think that everyone should create a startup and get rich that way. So, after correcting for rich guy tunnel vision, the statement "more people are starting companies" translates to "more people are starting technology companies in Silicon Valley." And of cou…
This is a huge part of "start up culture" though - like any religion (or lottery, or whatever), superstition plays a large part, and the most important superstition is that those who have been successful before know how to do it again.
They're swimming in money, they have a bunch of investors in their phone contacts, and they know all the ins and outs from the last time they put a startup through its life cycle. How could they not be in better shape than some kid slurping ramen in his first YC cohort?
This does leave two big wildcards: the idea (specifically its product-market fit) and pure dumb luck. From what you wrote, I'm guessing that you think this isn't realized by the "cult of YC" as well as it should be, whereas I guess differently, but it doesn't matter that much. We all recognize that it's there, and without those two ingredients you can't succeed.
As an aside, I've seen two different kinds of 'luck' come up in these kinds of conversations: the sort I'm referring to above, and the sundry genetic and social inheritances to which a person is heir.
They're both valid uses of the word, I think the first is more obviously lucky than the latter. It is luck of a sort that someone is 2 meters tall, but I bet their parents were also taller than average, so saying that it's lucky that they were able to be a pro at basketball is going to confuse some people. There was no "them" before the peculiar genetic combination which conceived them, and after that, we're talking about some favorable circumstances (adequate time, a court, no crippling car accidents or stray bullets) and a great deal of hard work.
Similarly, you can call it luck that Jeff Bezos was able to borrow a quarter million from his family, or that Elon Musk apparently can sleep for four hours and work for twenty, constantly, for decades (a genetic quirk no less special and rare than being two meters tall): but you can call it fate as well.
Re: How People Get Rich Now
#626Earlier quoted context omitted.
> A rich individual can give their child $0 in inheritance but one introduction, referral or diner party later and they could be set for life. It's a mighty big leap to go from a single intro to "set for life."
Don't misinterpret what the parent is saying. It's not "one introduction will", it's "one introduction could". If you are wealthy and connected enough there are many folks who will gladly ensure your children are taken care of, if for no other reason than to be connected to the parent/family. An introduction might lead to a job, apprenticeship, or internship. It might lead to a partnership somewhere or the opportunit…
The door to some people is permanently closed, no matter how hard their "hustle".
Re: How People Get Rich Now
#627Earlier quoted context omitted.
Yep, I wouldn't say I've had as much startup experience as you but I did work as employee #4 at one and then after that at a startup that got acquired by Google and while I did get a windfall out of that it certainly didn't make me rich and I've made a lot more money in the years since just taking in my regular FAANG compensation. FAANG compensations can be quite high. Arguably they are that high precisely to siphon…
Regarding the "escape velocity", it really isn't that tough IMO to save enough to retire when you're making 5-10x the median household US income, even if you're wasting $3500/month on rent. Yeah, milk and gas cost about twice what they do in the rest of the USA, but since I moved to the Bay Area I've been saving over a third of my income without even trying despite having a kid, eating out every day, and buying every…
Re: How People Get Rich Now
#628Earlier quoted context omitted.
When I look at that list, Jeff Bezos is #1. The first woman on the list is at #10 and inherited her wealth. Are you looking at a different list? Also, people born in foreign countries had completely different experiences, and more importantly, what is relevant is if they were in the bottom quintile in their own country. If you're super rich in your own country then you have a lot of opportunity. For example Sergey Br…
> When I look at that list, Jeff Bezos is #1. The first woman on the list is at #10 and inherited her wealth. Are you looking at a different list? I think the comment does refer to Jeff Bezos. Here is the relevant section from Wikipedia: "At the time of his birth, his mother was a 17-year-old high school student and his father was 19.[17] After completing high school despite challenging conditions, Jacklyn attended n…
Re: How People Get Rich Now
#629Earlier quoted context omitted.
Actually, I think this is almost the perfect response to his article. It's not hard to imagine that a guy who made his fortune off of startups would be biased to think that everyone should create a startup and get rich that way. So, after correcting for rich guy tunnel vision, the statement "more people are starting companies" translates to "more people are starting technology companies in Silicon Valley." And of cou…
Agreed. Maybe unpopular opinion, but entrepreneur insights from CEOs are rarely valuable because no individual contribution outweighs sheer luck. Every day millions of people make smart decisions, take good risks, and work hard without significantly improving their conditions. It is pure survivorship bias to think individuals are capable of more than slightly nudging the cosmic needle if it happens to land near the r…
It helps a lot to have an affluent background when you start a tech company because, like a lot of other risky endeavors, even though the potential rewards are enormous it's a lot less initial earnings than just joining a company as an employee. And you worry whether if your company doesn't take off and get its next round of funding in a few months if it'll be harder to get that first job. And you may be poorer than you were pre-startup.
Not to mention that poorer kids might not ever see starting a tech startup as an option. Both because of the biases in which founders get funding and because they may culturally never have the option floated to them.
Re: How People Get Rich Now
#630Strangely, an explanation for the increased number of wealths coming from new, tech companies and investments that is ignored in his post is the disturbing fact it was taken from the average employee cut of the profits. See this: https://www.theguardian.com/business/2018/aug/16/ceo-versus-... I quote: "The 2017 CEO-to-worker compensation ratio of 312-to-1 was far greater than the 20-to-1 ratio in 1965, and more than…
I hate this comparison. Stock based compensation didn't exist in 1965. It's an oranges to apples comparison. CEO salaries today are still about 20-1, depending on the business. For instance: - Doug McMillon of Walmart makes $1.2 million in salary. - James Quincy of Coca-Cola makes $1.5 million in salary. - JPMorgan's CEO Jamie Dimon has a $1.5 million salary. - Sundar Pichai of Google makes $2 million in salary. You…