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How People Get Rich Now

paulgraham.com

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Re: How People Get Rich Now

#711

Post by aerosmile »

Kye wrote: post #707
aerosmile wrote: post #697

Earlier quoted context omitted.

Instead of cash? Just like money, stocks don't grow on trees.

They find them for CEOs.

There are about 100 references on this page here alone stating that CEOs get relatively low cash comp in return for exceptionally high equity comp. Even CEOs have to treat equity as a form of compensation (duh!), and they have to trade off one against the other.

Some people here also pointed out that Amazon would rather pay RSU, but people prefer cash. We all know that Amazon outperformed the market in the last couple of years and that the RSU would have been more valuable than cash, but even with the benefit of that hindsight, most warehouse workers would still pick cash because they don't have the privilege of making long-term investments. The sad reality of today's society is that it's not that hard to make profitable long-term investments (just look at pretty much anyone's 401k) - but for the majority of the population, they just don't have enough money to put it to work.

Re: How People Get Rich Now

#712

Post by MomoXenosaga »

jdgoesmarching wrote: post #564
davesque wrote: post #309

Earlier 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…

I recall the 1999 tech bubble. Lots of companies went under in the crash that might have made it today.

There is a ton of VC money in Sillicon Valley again.

Re: How People Get Rich Now

#713

Post by vmception »

dcolkitt wrote: post #73

> It's easier now to start and grow a company than it has ever been. That means more people start them, that those who do get better terms from investors, and that the resulting companies become more valuable. This may be a quibble, because I think Paul Graham really means a certain type of high-growth startup in mind when he says "start a company". But the rate of new business formation in the US has fallen off a cl…

> The number of new companies as a percent of total businesses is 44% lower in 2012 than it was in 1978.

.... because the number of total businesses is so much higher already? The number of existing businesses that didn't create a subsidiary for an additional business line is higher?

That data point doesn’t tell you enough of anything. I’m glad it got you to look in that general direction, so now let's dig deeper.

Re: How People Get Rich Now

#714

Post by giantg2 »

bradlys wrote: post #674
giantg2 wrote: post #663

Earlier quoted context omitted.

I'm just curious, why do people choose to put themselves in that environment? I'm mean, based o the cost of living one could move to practically anywhere else (excluding about five areas) in the US and have this "very comfortable" lifestyle on $100k-150k.

Because you aren’t surrounded by peers. Some of us have lived in other areas and don’t want to go back for good reasons. People in other areas have jobs. People in SV have careers. Many more reasons to list. Average education among my peers is obscenely high (a bachelors is seen as being undereducated - masters is average with PhD being very common). The area isn’t that bad except for COL. Once you’re rich, it isn’t…

There are some companies on the east coast that want mostly PhDs. I have a Masters, but that's really nothing. I feel like degrees don't really mean much. They just show you put in your time (and money) and have at least half a brain. I've also seen highly educated people who aren't very good at independent thought.

"People in other areas have jobs. People in SV have careers."

This seems a little over generalized and even pompous. There are plenty of people who have careers in other areas. Just as a single example, how about the financial developers in NYC, like at Jane Street? There are plenty of people who leave SV too.

Re: How People Get Rich Now

#717

Post by gurumeditations »

This guy’s rant against liberals/ode to tech startups is illiterate and contradicted by his own notations. There’s practically a second separate essay down there explaining how he ‘creatively’ interprets data to mean what he wants it to mean. If you have to do that, you’ve written something really quite sloppy.

Re: How People Get Rich Now

#718

Post by slongfield »

lazide wrote: post #657
xur17 wrote: post #624

Earlier quoted context omitted.

How so? Isn't it just taxed as normal income at vesting time? Most employers automatically sell enough to cover the tax withholding to solve any issues.

Wash sales, long term/short term gains and associated tax issues, RSU withholding which is a fixed amount and not based on the income tax withholding, and a typical broker account to sell/get money are massively more complicated than a direct deposit to your bank account and money back from the government at the end of the year unless you massively screw it up. By number, most of Amazon’s employees are working minimu…

FWIW, Amazon doesn't treat its warehouse employees well, but it does pay more than minimum wage.

Re: How People Get Rich Now

#719

Post by aerosmile »

random314 wrote: post #482
aerosmile wrote: post #444

Earlier quoted context omitted.

You liked his idea that for a startup to scale, you should be doing things that don't scale. That article has mostly anecdotal evidence, and yet nobody ever pushed back on it. How do we know PG was right back then? (He was.) A few years later, that same guy writes an extensive essay with footnotes and data that must have taken days to compile (going all the way back to 1892). And yet, this one rubs you the wrong way.…

While pg has extensive foot notes for this essay, there is a vast amount of research with orders of magnitude more citations contradicting him on the gini coefficient. There is no argument about his footnotes. Quite likely the very richest might not be inheriting it. This has no bearing on the gini coefficient. And his essay on wealth tax is downright stupid. Are his essays as meticulously researched as Pikketys? Why…

I appreciate this argument, except for one detail:

> his essay on wealth tax is downright stupid

What's everyone's deal with that essay? It literally has no subjective opinion stated anywhere - all it does is calculate how much percent of your wealth you're left with after 60 years of wealth tax [0]. You definitionally cannot push back on anything stated in that article, or otherwise your problem is not with PG's views but with math in general.

I appreciate the thoughtful reference to Thomas Piketty's book, which I think everyone should read. But IMO attacking algebra takes away from your overall argument.

[0] http://paulgraham.com/wtax.html

Re: How People Get Rich Now

#720

Post by ikeboy »

extra88 wrote: post #694
ikeboy wrote: post #632

Earlier quoted context omitted.

The companies are much bigger today. If you run a company that's 10 times as big, why is it surprising that you're getting 10 times the compensation? You'd need to compare to similarly sized companies today. Instead, they look at the top 350 companies now and then.

The workers that produce 10 times as much today (because of newer technologies, techniques, etc.) don't get paid 10 times as much. Worker productivity has continued to climb, decade after decade, but inflation-adjusted worker pay is basically flat over the same time period.

This is a myth, and if you look into the statistics of the people pushing this Big Lie, you'll find that they cheat and use different inflation metrics for productivity and for compensation.
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