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How to earn a billion dollars

paulgraham.com

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Re: How to earn a billion dollars

#221

Post by tw04 »

TheTaytay wrote: post #129
AdamN wrote: post #124

She meant impossible in that one doesn't earn a billion dollars through work alone. The only way to get there is to set up a structure that extracts a billion dollars from a market (usually by building a structure that's more efficient but also generates externalities that are not borne by the person getting the billion dollars). pg's reading of it is so blunt and misrepresentative that I'm nervous about what kind of…

Your phrase “extract” betrays a fundamental disagreement with what Paul is saying. (Externalities does so again) It assumes a zero-sum game where the job is to shift money from one person to another. Value, and thus money/wealth can be created. Literally. You are saying, in different words, that no one can do it “honestly”. He is saying one can.

There is a finite amount of land on earth, and a finite amount of most natural resources. We currently have no indication we will EVER develop faster than light technology.

Any discussion not grounded in those facts is a dishonest discussion. It is a zero sum game until those externalities change because ultimately our species is built upon extraction resources to produce wealth. It IS a zero sum game until you or someone else invents a means of solving the first order problems.

Re: How to earn a billion dollars

#222

Post by groundzeros2015 »

reinitctxoffset wrote: post #68

There's an older tradition of thought on the matter with better intellectual pedigree and epistemological hygiene: "Behind every great fortune lies a great crime." The easiest way to earn a million dollars is to start a business that makes sense and work your ass off running it well. Maybe that's even the easiest way to reliably earn ten million dollars, a million isn't what it used to be. But at some scale that's fa…

PG actually addresses this in other essays. That adage does have more history. But the world literally changed;

1. In pre-industrial society there is less technological leverage, so that it’s very difficult for an incidental or group to help very many people.

Perhaps the closest analog before then was land discovery or conquest (taking other people’s stuff).

2. Post-enlightenment society is one of the first which doesn’t predefine your social role by birth. So you can claim new roles and status from your own wealth.

America has a much stronger sense of 2 which is why European attitudes towards wealth differ.

Re: How to earn a billion dollars

#223

Post by theopsimist »

theopsimist wrote: post #161

- So I would like you all to do me a favor please. I would like you to take out your phones and calculate a number. I know this may seem contrived, but I promise it will be useful for you. I’m thinking of vibe coding a calculator app How Many Babies Died For This where you input your startup idea, life(style) goals and AI token usage and the machine spits out the Net Babies Dead for you to achieve your dreams

Or as someone more elegantly phrased: https://x.com/tobytarrant/status/2065946761332486231

Re: How to earn a billion dollars

#224

Post by hjkl0 »

TheTaytay wrote: post #129
AdamN wrote: post #124

She meant impossible in that one doesn't earn a billion dollars through work alone. The only way to get there is to set up a structure that extracts a billion dollars from a market (usually by building a structure that's more efficient but also generates externalities that are not borne by the person getting the billion dollars). pg's reading of it is so blunt and misrepresentative that I'm nervous about what kind of…

Your phrase “extract” betrays a fundamental disagreement with what Paul is saying. (Externalities does so again) It assumes a zero-sum game where the job is to shift money from one person to another. Value, and thus money/wealth can be created. Literally. You are saying, in different words, that no one can do it “honestly”. He is saying one can.

Based on this article at least, he is not disagreeing with those claims, he is not even acknowledging they exist.

The original claim, as I understand it, is basically this: you can’t be an honest actor in a dishonest system.

And it’s not even necessary to claim that billionaires did something uniquely wrong to become billionaires. It’s just that their share of the exploitation is so, so, so much bigger.

Re: How to earn a billion dollars

#225

Post by fractallyte »

DanHulton wrote: post #169

Why would you even WANT to become a billionaire? Wealthy, sure, but becoming a billionaire effectively destroys your place in any of your social circles. It obliterates any dynamics of trust and interdependence you may have and replaces them with a gnawing unease about if they’re still hanging out with you, or if they’re hanging out with the money. Not to mention, Graham entirely fails to differentiate between EARNIN…

You don't have to advertise that you're a billionaire. You can live quite normally while quietly changing the world as a "side job".

Re: How to earn a billion dollars

#226

Post by [deleted] »

sobellian wrote: post #200
CPLX wrote: post #165

Earlier quoted context omitted.

His entire essay is just based on a purposeful misreading of the opposing point. It's a straw man. And if you look at his history it's obviously intentional and part of his usual style of argument. The actual opposing argument is that it's impossible to create a billion dollar enterprise without a group effort, and for one person to end up with a billion dollars necessarily means that they made decisions within that…

Of course it's arguable. You make it sound like founders perform some jedi mind-trick to take money from others. Here's what actually happens. Investors put in initial money because it's a win-win (they get an expected return, founders get starting capital). Employees join because it's a win-win (they get a salary, health, equity, other perks; founders get a workforce). Customers pay cash because it's a win-win (they…

[deleted]

Re: How to earn a billion dollars

#227

Post by Telemakhos »

owaiswiz wrote: post #163

> She was getting richer at a stupendously rapid rate. And yet she hadn't been doing anything bad. The reason her startup was growing so fast was simply that users loved what she'd built. So she could feel from her own experience how wrong that politician was. She wasn't exploiting anyone. I presume it's a company that just has co-founders then? Or everyone is getting an equal % of the share? In which case SHE's not…

Let's say she has ten employees. They all voluntarily agree to work for her: slavery is illegal, so people work for others on a consensual basis. Both the employer and employee negotiated and consented to a salary or wage schedule for that employee. The employer pays the agreed-upon compensation, and the employee receives it.

If the company makes an unexpectedly large profit, the employer is not obligated to redistribute that to her employees in addition to the already agreed-upon and paid compensation. If the employees think that what they agreed to work for is no longer sufficient, they are welcome to renegotiate their compensation or, if they feel they have been wronged and are being paid less than they are worth, to take their talent to a different employer. After all, everything so far has been consensual. The only thing that would be non-consensual would be obligating the employer to redistribute her profit over and above what had already been negotiated.

Re: How to earn a billion dollars

#228

Post by TheOtherHobbes »

holistio wrote: post #87

I've been able to calculate logarithms for well over 20 years. That's not the problem. The problem is even simpler mathematics. Proportions. How much do we give to first employees? How realistic is that John Smith, first salesman of the company is getting 2% and should consider himself lucky, while I, Peter Boss retain most of the company? We always talk about the dilation of the founders' shares and its relation to…

Simply, neoliberal capitalism is sociopathy with quarterly returns.

The assumptions are:

1. A uniquely special class of people do all the work that matters. They're astoundingly gifted, talented, and insightful, and have a rare ability to make profits happen by having very special ideas, owning Important Things, and telling everyone else what to do. These prodigies deserve everything. They are not to be criticised or judged by their inferiors. Ridicule only proves their superiority.

2. The work everyone else does is far less important. Most of the people doing it are interchangeable and literally disposable. Sometimes they deserve nice things, in a limited sense, if it's hard to make things happen without them. But mostly no.

3. Negative externalities - pollution, ecosystem collapse, spiralling asset prices, financial and political instability - aren't real. If they are real they don't matter. If they do matter they're someone else's fault.

4. It's absolutely fine to treat other humans with aggressive indifference and outright contempt as long as Number Goes Up. In fact it's expected.

Re: How to earn a billion dollars

#229

Post by oreally »

GlibMonkeyDeath wrote: post #213
readingnews wrote: post #44

The real problem is his example, "you start off with 2 million dollars and 95% growth rate". Fine, show me the average person who can come up with 2 million dollars. I sure as hell can not. I even went to banks and founders with my ideas, cash flow sheets and customer list looking for a loan. No, I am convinced, the rich already have 2 million dollars, and make themselves a billionaire. The system is rigged against "…

He was talking about an equity stake in a start-up. Although on paper it is worth $2M, it is (probably) not liquid (i.e, the shares can't be traded easily, maybe at all.) The vast majority of founders don't literally spend $2M from their checking account to purchase their position in a start-up - they get some ownership as part of taking the start-up risk.

Is there some standard he/people use to come up with the initial company paper-stock worth? A 2m company I would imagine needs to have some tangible traction already.

Re: How to earn a billion dollars

#230

Post by [deleted] »

owaiswiz wrote: post #163

> She was getting richer at a stupendously rapid rate. And yet she hadn't been doing anything bad. The reason her startup was growing so fast was simply that users loved what she'd built. So she could feel from her own experience how wrong that politician was. She wasn't exploiting anyone. I presume it's a company that just has co-founders then? Or everyone is getting an equal % of the share? In which case SHE's not…

[deleted]
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