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Taking Risk

tomblomfield.com

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Re: Taking Risk

#201

Post by throwaway2037 »

The opening paragraph has a major blunder:

    > The US - a country with 5x more people and 8x higher GDP
Who cares about "8x higher GDP"? China has the world's second largest GDP and the world isn't clamoring to move there. Why? Because GDP per capita is still low, compared to many other countries. Finally, median income is a much better number to use when comparing countries.

Re: Taking Risk

#202

Post by K0balt »

Aromasin wrote: post #95
reedf1 wrote: post #22

I considered a startup after university in the UK. The talent arbitrage is absurd, physics grads with 1sts from top Russell Group unis fighting to be paid £30k/yr. For me it came down to security, life is expensive, rent is expensive. I didn't have a spare parental garage to setup five computers - I barely had room in my flat for one desk . I barely had money for that flat let alone internet, and food. I had zero cap…

I'm in the same boat. I've been chasing my tail for the last 6 years, just trying to keep my head above water financially. I'm a computer hardware engineer so the pickings are slim to none outside of the military-industrial complex, which pays shit outside of sales and executive management. Ended up at one of the big US semiconductor companies where I got paid 1/3rd of what my peers in the US earn, with similar expen…

I have a question.

What if there was a place that you and a few colleagues could go where you could have your living space and office space provided, basic food served, and basic amenities.

Such a place would probably be somewhat isolated and probably not in your own county. If such a place existed that catered to founders in exchange for minimal equity, is that something that would interest you, theoretically?

Re: Taking Risk

#203

Post by throwaway2037 »

robertlagrant wrote: post #128
robin_reala wrote: post #49

Our instinct is to regulate and tax the technologies that are being pioneered in California, in the misguided belief that it will give us some kind of competitive advantage. I don’t think that that’s the reason for regulation: it seems to me that US companies traditionally don’t care about externalities (environment, privacy, accessibility, etc.), and regulation is required to bring them into line. That doesn’t alway…

This is a bad stereotype, I think. The US has regulatory failures like FTX, but at least that's a brand new market and type of commodity (or currency, maybe). And it was prosecuted under existing regulation anyway. The EU had Wirecard, a financially totally mundane company, and regulations didn't stop anything. It happens everywhere. The difference is that the US is a force multiplier for businesses and innovation, s…

    > The EU had Wirecard
To me, this is misleading. Please stop writing as though all of the EU is uniform. It would be better to write: "Germany had Wirecard". That is much more accurate.

Re: Taking Risk

#204

Post by throwaway2037 »

helsinkiandrew wrote: post #107

> It was inconceivable that the Bank of England would authorise me, a 31 year old who’d never even worked in a bank, to act as the CEO of the UK’s newest bank. In general I would think this as a good thing. The UK has a more rigorous banking control than the US (where different state laws can make starting a bank easier than in the UK), with more scrutiny of the business model and customer protection - you need to pr…

    > none of the failures that have happened in the US in the past few years
I assume you are referencing Silicon Valley Bank, which wasn't a small bank and wasn't run by young, inexperienced leaders. In the US, community banks would be 10% the size of SVB at its peak (before the run). Except SVB, can you name any other failures? And were they due to young, inexperienced leaders? I cannot name a single one.

Re: Taking Risk

#205

Post by PeterisP »

dan-robertson wrote: post #70
rwmj wrote: post #7

The expected returns from "want[ing] to go and work at companies like McKinsey, Goldman Sachs or Google" are both greater and more certain, so perhaps the individual young people are acting quite rationally in the UK? For context I spent years in my 20s doing start ups in London, and undoubtedly would have been better off financially now if I'd worked for some soul-sucking consultancy instead. I do agree with him tha…

Yeah, but I think it’s also true in the US (even more so as pay from the non-startup careers is higher). Maybe one should ask why it’s so much more common to do the irrational thing in the US than the UK.

A key part is that in US you take less risk because investors are taking more risk - as described in the article, in UK the conditions you'd get for early funding push more risk towards the founder as most UK investors simply won't accept as much risk as US investors routinely do.

Re: Taking Risk

#206

Post by throwaway2037 »

poooogles wrote: post #100
oblio wrote: post #82

Earlier quoted context omitted.

> Your future employer How will they know and why would they care, if we're talking about regular job postings?

You'd be ruled out of many FCA (financial conduct authority) regulated jobs for at minimum 6 years after.

Even at an investment bank in London, the percentage of FCA regulated jobs that would exclude you for recent personal bankruptcy would be less than 1%. And the reason for personal bankruptcy would be important. Did you go bankrupt for gambling losses or unpaid medical bills? These would receive very different treatment by the FCA when considering your application.

Re: Taking Risk

#207

Post by Aeolun »

buynlarge wrote: post #181
matwood wrote: post #152

Earlier quoted context omitted.

The UK is a giant version of the Cayman Islands. It's a big bank providing financial services to rich people while keeping them anonymous. Everything else is secondary. And Brexit only made it worse.

On the other hand, the UK is one of the safest countries in the world, is full of kind people, has a general abundance of food, gives workers a relatively large number of days off in a year, has a functioning police force and takes care of sick people and those who can't work for whatever reason. Of course it is not perfect. The people of Britain may not have huge bank accounts, but this is partly because they collec…

Right now whether you get taken care of when sick depends heavily on where you live.

Re: Taking Risk

#208

Post by nextos »

somethoughts wrote: post #168
light_triad wrote: post #155

There's many factors that make Europe less competitive than the US: small fractured markets, low salaries, high cost of living relative to wages, Brexit costs, fear of being labeled a failure, working to live, focus on worker's rights, stability, and pensions, general risk aversion etc. A big issue is there's a lack of mega successes high margin software businesses that pump knowledge and money back into the startup…

"There's many factors that make Europe less competitive than the US: small fractured markets" This first one seems the largest hurdle w.r.t. startups. If you are a startup founder of say a ride hailing app - the total addressable market is much larger in the US for the same level of effort. If you want to scale beyond your home state (i.e. California) in the US, there are probably just a handful of different state/ci…

You are right in terms of the addressable market. Except in some niches, like pharma, it is too fractured. But IMHO, the biggest problem here is mentality. Starting a business and taking risks is not something the society encourages. That is what we have from centuries of rent-seeking aristocrats.

A good counterexample is Sweden, where class structure is flatter and imitating American trends is seen as cool. Unsurprisingly, Stockholm punches above its weight class in terms of startups, despite Sweden being a tiny market.

Re: Taking Risk

#209

Post by Aeolun »

leoedin wrote: post #54
reedf1 wrote: post #22

I considered a startup after university in the UK. The talent arbitrage is absurd, physics grads with 1sts from top Russell Group unis fighting to be paid £30k/yr. For me it came down to security, life is expensive, rent is expensive. I didn't have a spare parental garage to setup five computers - I barely had room in my flat for one desk . I barely had money for that flat let alone internet, and food. I had zero cap…

The low salaries are a double edged sword - the talent is cheap, but the kind of people who might start a company are unable to build up enough savings to take the leap. It's partly due to low salaries, and partly high housing costs. It's crazy that politicians on all sides talk about growth, but then consistently do almost nothing to address the single largest thing that's sucking the life out of 20-30 year olds. Sa…

Just making housing cheaper would do so much for peoples ability to take the leap.

Re: Taking Risk

#210

Post by nextos »

throwaway2037 wrote: post #197
jltsiren wrote: post #191

Earlier quoted context omitted.

Low salaries increase competitiveness, while high salaries decrease it. That's one of the things you already learn as a kid when you live in an export-driven economy. Even if your country is not particularly export-driven but you participate in competitive markets, the same effect may apply. For example, the US lost many manufacturing jobs to China, because American salaries were not competitive (low) enough. Finland…

This is an interesting post. Thank you to share your thoughts. > Finnish companies have traditionally been good at developing technology and bad at commercializing it. Can anyone provide some concrete examples?

Polar and Suunto. Excellent technology, but they were never marketed very well and achieved only moderate success.

One was acquired by a Chinese corporation, the other is in financial trouble.

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