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Corporate America Hasn’t Been Disrupted

fivethirtyeight.com

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Re: Corporate America Hasn’t Been Disrupted

#61

Post by S4M »

maxsilver wrote: post #27
michaelochurch wrote: post #21

First of all, it's pretty clear that the Valley isn't "disrupting" the establishment. It is the establishment. The elephant in the room: the death of the middle class. Thirty years ago, unions were strong and average people had savings. Venture capitalists were wealthier than average, but not of a superior class... and they still hung out with people who wrote code for a living. Class distances weren't nonexistent, b…

Agree entirely. This is a perfect write up of the situation at hand. > but one sector that isn't being targeted is the (disintegrating) middle class. So, what (if anything) can we do to fix this? Is there anything a regular person can do or work on to help the (disintegrating) middle class?

I am thinking of favoring remote work. That way employees won't have to spent the largest part of their salary in expensive rents, and for the employer it's advantageous at he can pay a bit lower than the market rate (and still make his employees happy).

That's a simple measure new startups could adopt, and I keep being surprised YC companies are not looking for remote people.

Re: Corporate America Hasn’t Been Disrupted

#62

Post by EliRivers »

bluedino wrote: post #45
schnable wrote: post #30

Much of what we are seeing is the effect of our insane visa and immigration policies. The traditional entrepreneurial spirit of the United States was driven by the culture of immigrants. Over 40% of the companies on the Fortune 500 were founded by immigrants or the children of immigrants. These were once disruptive startups. Now we make it very difficult for talented and intelligent people to become permanent residen…

We have 7-20 million illegal immigrants in the USA out of 313 million total residents. How difficult can it really be to stay?

If it was easy, they wouldn't be illegal.

Re: Corporate America Hasn’t Been Disrupted

#63

Post by yummyfajitas »

schnable wrote: post #30

Much of what we are seeing is the effect of our insane visa and immigration policies. The traditional entrepreneurial spirit of the United States was driven by the culture of immigrants. Over 40% of the companies on the Fortune 500 were founded by immigrants or the children of immigrants. These were once disruptive startups. Now we make it very difficult for talented and intelligent people to become permanent residen…

A quick google search suggests this explanation doesn't work.

http://web.mit.edu/cis/images/fpi/immigration/fig1.jpg

http://web.mit.edu/cis/images/fpi/immigration/fig3.jpg

If correlations prove anything (note: I don't think they prove much), it is that immigrants inhibit startup formation.

Re: Corporate America Hasn’t Been Disrupted

#64

Post by logicalmind »

jusben1369 wrote: post #47
sadface wrote: post #24

I have another suggestion for the decline in startup rates: health care and college expenses. The historically "prime" years for entrepreneurship are in one's late 30's to early 50's, years when one typically has a family in need of healthcare, college tuition, and hopefully retirement at some point down the line. In the 70's and 80's someone could leave the security of their big company, get relatively affordable pr…

I'm 100% with you. When I left my job to do my startup to maintain my health plan at current levels was $1400 per month. That's $18,000 or so a year pre tax dollars. Basically the first $25,000 a year you pay yourself is going to just having healthcare! Assuming you want a decent plan. When we were 4 people all making just enough bootstrapping before we raised 35% of our costs went to healthcare. It was never raised…

Same here. I've been a developer for years and as I've transitioned jobs I've met a number of really good developers. Any time an idea arises that would make a tempting startup I reach out to people I've worked with to solicit the opportunity to work on it together. Every time I've done so, the inevitable decline always has something to do with healthcare.

Once you're beyond your post-college years and have a wife, and possibly children, the risk of a startup suddenly includes the cost of healthcare and risk of not having any. All of us can make comfortable salaries and have money to take risks on our dreams and be protected from failure by incorporation. But that does not translate to the potential medical issues of yourself or your family which would lead to personal bankruptcy and future employment issues.

Re: Corporate America Hasn’t Been Disrupted

#65

Post by Consultant32452 »

Consultant32452 wrote: post #46
maxsilver wrote: post #27

Earlier quoted context omitted.

Agree entirely. This is a perfect write up of the situation at hand. > but one sector that isn't being targeted is the (disintegrating) middle class. So, what (if anything) can we do to fix this? Is there anything a regular person can do or work on to help the (disintegrating) middle class?

I would suggest joining unions and encouraging others to join them. With all the nonsense coming out of Google, Microsoft and others regarding wage warfare against their own employees I'm shocked that developers haven't unionized.

I'd also like to point out that unions would likely offer much greater protection for the likes of Snowden. There would be viable paths to take within the union and would likely result in not having to run off to Russia.

Re: Corporate America Hasn’t Been Disrupted

#66

Post by superuser2 »

pyrrhotech wrote: post #56
superuser2 wrote: post #50

Earlier quoted context omitted.

Where?!? University of Wisconsin, for example, is $24k in-state with room and board. To get through college for $10k/year in many places, you'd need to go to one of the state's lower-tier schools in a small town and live at home. Not many state flagships are in the business of charging less than $20k.

She goes here: http://www.collegedata.com/cs/data/college/college_pg03_tmpl... She does live at home. If she lived at school it would be about $17k

You said "with room and board," which implies living in university housing. That would do it.

Re: Corporate America Hasn’t Been Disrupted

#67

Post by anigbrowl »

snowwrestler wrote: post #42
mason55 wrote: post #12

Earlier quoted context omitted.

Reminds me of an article on /r/movies the other day about "XYZ didn't kill the movie industry, the movie industry killed itself". Well... no. The movie industry is far from dead and is doing quite well for itself. It even avoided the mistakes the music labels made when they gave Apple too much power (a mistake that they have since recovered from).

Some labels/studios are being hurt by piracy, primarily the mid-size and smaller independents. They have less financial leverage over their artists, but more importantly, many of them choose to limit their relationships with artists to publishing and promotion, so they are more dependent on album sales for revenue. They also tend to more fan-friendly, so they generally choose not to fight against file sharing, etc. e…

Exactly. The labels that have been worst hurt by the digital revolution were the least exploitative ones.

Re: Corporate America Hasn’t Been Disrupted

#68

Post by pessimizer »

rayiner wrote: post #3

I think there is a bit of cognitive dissonance in the tech community about "disruption" versus "big companies." Technology, in general, makes it easier to scale companies to large sizes, and "disruption" often involves using technology to enter an existing industry that is dominated by small, inefficient companies. A great example is Uber. Uber is making the taxi market a lot more efficient, but it's also well on the…

>Small businesses are generally inefficient and prone to failure.

Also, small businesses have to make money now, or nearly now, before their angels run out. Large businesses can lose money for as long as it takes for the small businesses to fold, and will still attract investment that anticipates the future monopoly/monopsony pricing possible after all small firms close.

Also, large companies can eat small competitors, or collude with each other (non-competes, patent truces) in ways that exclude the smaller actors.

-----

Edit with a possible Uber future:

Cab companies will start to (continue to?) run their hired business through Uber, and eventually Uber will gain the ability to pick up street hails. Uber will buy Taxi.com and ditch the Uber brand. The new Taxi.com will market itself as a dispatching service for independent taxi companies, but take a large percentage off of the top of each cab ride - and reduce that percentage in markets where independents have managed to survive. They'll also unify through systemwide discounts/customer loyalty programs. In the end, the only difference in the taxi market will be a new middleman, higher + less direct pricing, and lower quality (after you have to take what Uber gives you.)

Re: Corporate America Hasn’t Been Disrupted

#69

Post by logicalmind »

tzs wrote: post #58
pyrrhotech wrote: post #33

Earlier quoted context omitted.

I dunno, state schools are still pretty cheap. My sister's tuition with room and board is $10k per year. If you are someone smart enough to be an entrepreneur in your late 30s, you should have a corporate job paying 150k+ and can save all 4 years worth in a matter of months with a bit of determination. And health care, while expensive, isn't as big of a deal as most people make it out to be. Get a high deductible pla…

> Get a high deductible plan and a family of 4 can be insured for Looks like it can be done for quite a bit less than that, when ACA subsidies are taken into account (or when expanded Medicaid is taken into account if the other adult family member also has no income...I think all the states where tech startups are common went along with expanded Medicaid).

But presumably you are going to have co-founder(s) or employees. The decision is not just for yourself or your family. Your co-founder(s) will have to accept the same situation and anyone you employ would also be expecting health coverage.

Re: Corporate America Hasn’t Been Disrupted

#70

Post by anigbrowl »

spodek wrote: post #28

As a Professor of entrepreneurship at NYU's engineering school (that VC Fred Wilson called a jewel -- http://avc.com/2014/03/the-value-of-an-engineering-degree ), I can summarize the problem in one phrase many of my students said when describing their goals after graduation: "... but I have to get a job at a big company to sponsor my visa." They're brilliant, motivated, and capable, but almost none are citizens. To s…

A corollary to that is that even if you work out the legal obstacles (it's possible to get a tax ID and even start a company without having legal status), it's difficult to accumulate the seed capital if you can't work a regular job.

That'a s bit less of an issue for people in tech startups - if you already have a laptop and internet service, then you may not need any additional physical capital - but it can be a huge barrier in other lines of business where you may need to invest in a fair amount of equipment in order to be basically competitive. Say someone wants to start a photography business, for example, which is pretty lightweight sort of business - you're still looking at maybe $10k of gear and a year of studio/office rental expenses, potentially much more. You don't have to go that route to succeed as a photographer, but absent that starting capital it's going to take considerably longer to get established. And while that's not a huge amount of money, many immigrants don't have access to credit or jobs that pay enough to accumulate savings.

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