Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Forbes 400 Data Shows Paul Graham Is Wrong

news.ycombinator.com

Post reply on HN
Print view View original

11–20 of 147 posts

Re: Forbes 400 Data Shows Paul Graham Is Wrong

#11

Post by apsec112 »

thunk wrote: post #9

> I think the record speaks for itself. There's something about the way you phrased this that makes me think you were gunning for pg. It would be nice if you included the complete breakdown, as well as your criteria for determining tech vs. finance. Since you had to manually go through the entire list, I can't imagine it would have been difficult to record your results.

"There's something about the way you phrased this that makes me think you were gunning for pg."

I was responding to him specifically, yes.

"Since you had to manually go through the entire list, I can't imagine it would have been difficult to record your results."

Not actually difficult, just time-consuming (I did it by having the two different lists, sorted by name for easy comparability, in two adjacent browser windows).

Re: Forbes 400 Data Shows Paul Graham Is Wrong

#12

Post by pg »

apsec112 wrote: post #7
pg wrote: post #6

Earlier quoted context omitted.

I'm curious what your test was for deciding whether someone was in finance.

Here are the industries I considered to be "finance": - Hedge funds and other money management - Private equity - Investment banking - Leveraged buyouts - Proprietary trading - Traditional (retail) banking and credit cards I did not consider heirs with investments to have gotten their money in finance, unless they increased their original sum ten-fold or more (in real dollars). I also did not consider real estate inv…

Sounds reasonable. But when you have time it would be useful to see the actual lists of the people you put in each category.

Re: Forbes 400 Data Shows Paul Graham Is Wrong

#13

Post by _delirium »

nazgulnarsil wrote: post #10

outliers hold no interest for me. what percentage of people who tried to become successful financiers made it vs what percentage of tech entrepreneurs started a successful company?

That'd be an interesting number as well, but my guess is that financiers win there, too. Even if you don't make it big in finance, you can "fail" into a lot of lower-level jobs that pay around $200-300k. In tech, the fail-out-into-a-salary route tends to get you more like $100-150k.

Re: Forbes 400 Data Shows Paul Graham Is Wrong

#14

Post by apsec112 »

nazgulnarsil wrote: post #10

outliers hold no interest for me. what percentage of people who tried to become successful financiers made it vs what percentage of tech entrepreneurs started a successful company?

Difficult to say exactly. Both are definitely high-risk industries. The key difference is probably the timespan over which you make your money. A moderately successful entrepreneur might work hard for five years, sell his company for $20M, and get $4M of that. A moderately successful financier might work hard for thirty years, and make $500K - $2M every year that he works. Essentially, successful financiers tend to be older (50s and up) while successful entrepreneurs tend to be younger.

Re: Forbes 400 Data Shows Paul Graham Is Wrong

#15

Post by [deleted] »

pg wrote: post #12
apsec112 wrote: post #7

Earlier quoted context omitted.

Here are the industries I considered to be "finance": - Hedge funds and other money management - Private equity - Investment banking - Leveraged buyouts - Proprietary trading - Traditional (retail) banking and credit cards I did not consider heirs with investments to have gotten their money in finance, unless they increased their original sum ten-fold or more (in real dollars). I also did not consider real estate inv…

Sounds reasonable. But when you have time it would be useful to see the actual lists of the people you put in each category.

[deleted]

Re: Forbes 400 Data Shows Paul Graham Is Wrong

#16

Post by JacobAldridge »

There's a fundamental difference between 'there are more financiers than start-up founders in the Fortune 400' and 'a greater percentage of financiers in America make the Fortune 400 than start-up founders in America'.

Using extreme example to make my point, if 0.001% of all 'financiers' made the Fortune 400 and 5.000% of all start-up founders did, no-one would claim that 211 v 59 means much because of the asymmetrical volume of the candidate pools.

The percentages won't be that stark, of course. Are there 4 times as many financiers as start-up founder? I would suggest more (many, many more) which would indicate that being a start-up founder makes it more likely to hit that measure of financial success than being a financier, based on those figures.

I make no comment about the relevance of this to the original discussion and pg's right or wrongness, which I was not a part of.

Re: Forbes 400 Data Shows Paul Graham Is Wrong

#18

Post by jpark »

nazgulnarsil wrote: post #10

outliers hold no interest for me. what percentage of people who tried to become successful financiers made it vs what percentage of tech entrepreneurs started a successful company?

If you can make the cut at a top investment bank, hedge fund, PE firm, etc, it's fairly trivial to accumulate $1M in liquid assets after 10 years of work. Much much easier than trying to sell your startup for > $1M.

Re: Forbes 400 Data Shows Paul Graham Is Wrong

#19

Post by pyre »

nazgulnarsil wrote: post #10

outliers hold no interest for me. what percentage of people who tried to become successful financiers made it vs what percentage of tech entrepreneurs started a successful company?

Maybe, but that's not what this discussion is about:

Original Post: http://apps.ycombinator.com/item?id=1320439

  > Despite the high risk/high reward, I think the
  > expected value (in money) of going to Wall
  > Street is still quite a bit higher than that of
  > a startup.
pg's reply: http://apps.ycombinator.com/item?id=1320447 :

  > The one place data is easy to find is at
  > the high end-- in the Forbes 400-- and there
  > at least that is not the case.

Re: Forbes 400 Data Shows Paul Graham Is Wrong

#20

Post by paraschopra »

apsec112 wrote: post #14
nazgulnarsil wrote: post #10

outliers hold no interest for me. what percentage of people who tried to become successful financiers made it vs what percentage of tech entrepreneurs started a successful company?

Difficult to say exactly. Both are definitely high-risk industries. The key difference is probably the timespan over which you make your money. A moderately successful entrepreneur might work hard for five years, sell his company for $20M, and get $4M of that. A moderately successful financier might work hard for thirty years, and make $500K - $2M every year that he works. Essentially, successful financiers tend to b…

> Essentially, successful financiers tend to be older (50s and up) while successful entrepreneurs tend to be younger.

I think this data can also answer the question. Has any one done any calculations on this front?

Post reply on HN