The smart middle ground would be applying good technology/product entrepreneurship to the finance industry. They clearly have the money to play with and what may seem simple to us is wizardry to them. Someone pointed out an opportunity to me yesterday re: illiquid real estate assets. My mind is blown. I'm sitting here fucking around trying to get a 300k angel round, and these guys are trying to get rid of 300mil. there's a lot of money to be had out there combining tech/product know-how with boring industries. Money is usually found in the unsexy places.
Forbes 400 Data Shows Paul Graham Is Wrong
71–80 of 147 posts
Re: Forbes 400 Data Shows Paul Graham Is Wrong
#72Earlier quoted context omitted.
I didn't write them all down because that would have taken another hour and it's 11 PM Bay time on a Friday, but here are a few: http://en.wikipedia.org/wiki/Ray_Dalio http://en.wikipedia.org/wiki/James_Simons http://en.wikipedia.org/wiki/Steve_Schwarzman http://en.wikipedia.org/wiki/John_Paulson http://en.wikipedia.org/wiki/Daniel_Och http://en.wikipedia.org/wiki/David_Shaw http://en.wikipedia.org/wiki/Steven_A._Coh…
But that's not quite accurate. You see, while these guys are in Finance, at least 1/3rd of the above have serious hacking skills, not traditional finance skills; James Simons - math, but closer to hacker than financier Kenneth Griffin - was financial hacker , not a dealmaker DE Shaw - another hacker, a computer scientist/compbio
None of the above except Shaw are technology people. Simons is a mathematician, and Griffin seems to have a pure finance background:
"While still at Harvard University, he started two funds from his dorm room, and he claims that in between classes he would make trades. He even installed a special satellite link to his dorm to acquire real-time market data. After graduating with a degree in economics, he won the attention of an investor named Frank C. Meyer, founder of Glenwood Capital [1]. Meyer was amazed at Griffin's success and rate of return with his investments (which at the time were largely based on convertible bonds), and provided a relatively small investment for Griffin to invest ($1 million) [2]. Griffin exceeded Meyer's expectations, and as word of his strong performance spread, investors persuaded to back Griffin. Citadel was officially founded Nov. 1, 1990 with $4.2 million; the name "Citadel" was chosen to suggest strength in times of volatility [3]." - http://en.wikipedia.org/wiki/Kenneth_C._Griffin
Re: Forbes 400 Data Shows Paul Graham Is Wrong
#73I used to work for CSFB (now Credit Suisse) in London's Canary Wharf. It's the most I've earned in my entire career. Unless you've worked for an investment bank you have no idea how much money they have. It's like a giant gulf-of-mexico-style money gusher that doesn't quit. How do they make it? CSFB flies on the bleeding edge of what's legal and always have. I was there when Frank Quattrone was involved in the IPO of…
I don't think if I could live with myself if I worked at an investment bank. Most of what they do provides no benefit to humanity, in fact on the whole they're probably parasitic. Shuffling money around senselessly while taking a cut might be extremely profitable if you do enough of it, but it's just a drain on modern capitalism.
Re: Forbes 400 Data Shows Paul Graham Is Wrong
#74Earlier quoted context omitted.
Also consider that you didn't create the system and are just a part of it, if you don't take the job someone else will. Depends what stage of your life your at, the money could be a primary concern or a secondary one with flexibility, personal interest and creating something valuable higher.
> you didn't create the system and are just a part of it, if you don't take the job someone else will. Exactly why I moonlight as a crack dealer, with the odd stint pimping adolescents I meet at the bus terminal. Sorry for the lame attempt at the witty reply... I guess the point is that not doing something doesn't mean it won't happen, but it does mean you won't do it, and that matters to some people.
I have far fewer moral qualms about crack dealing than investment banking.
Re: Forbes 400 Data Shows Paul Graham Is Wrong
#75I used to work for CSFB (now Credit Suisse) in London's Canary Wharf. It's the most I've earned in my entire career. Unless you've worked for an investment bank you have no idea how much money they have. It's like a giant gulf-of-mexico-style money gusher that doesn't quit. How do they make it? CSFB flies on the bleeding edge of what's legal and always have. I was there when Frank Quattrone was involved in the IPO of…
I don't think if I could live with myself if I worked at an investment bank. Most of what they do provides no benefit to humanity, in fact on the whole they're probably parasitic. Shuffling money around senselessly while taking a cut might be extremely profitable if you do enough of it, but it's just a drain on modern capitalism.
Tell that to Southwest Airways.
http://en.wikipedia.org/wiki/Southwest_Airlines#Hedging_fuel
Shuffling money around is also useful for making public what would otherwise be private information. Greece can profess to the world how solvent they are, but the swap market tells a different story.
Re: Forbes 400 Data Shows Paul Graham Is Wrong
#76Earlier quoted context omitted.
I don't think if I could live with myself if I worked at an investment bank. Most of what they do provides no benefit to humanity, in fact on the whole they're probably parasitic. Shuffling money around senselessly while taking a cut might be extremely profitable if you do enough of it, but it's just a drain on modern capitalism.
Tell that to Southwest Airways. http://en.wikipedia.org/wiki/Southwest_Airlines#Hedging_fuel Shuffling money around is also useful for making public what would otherwise be private information. Greece can profess to the world how solvent they are, but the swap market tells a different story.
I said "most of what they do" rather than "all of what they do" because some of it coincidentally helps others. The ratio of parasitic behavior to useful is unfortunately growing, and hasn't stopped just because it caused an economic meltdown.
Re: Forbes 400 Data Shows Paul Graham Is Wrong
#77Earlier quoted context omitted.
Just fyi, every person you listed above founded the financial company that made them rich. So they are founders and did do a startup - just not a technology startup.
How are you defining "startup"? "Startup" for most people has technology connotations. To quote PG: "Startups are a comparatively new phenomenon. Fairchild Semiconductor is considered the first VC-backed startup, and they were founded in 1959, less than fifty years ago." Clearly, he's referring to tech startups specifically. If you consider any small company that becomes big a startup, then Rockefeller and Carnegie m…
I can't imagine describing either Renaissance (founded by Simon) or DE Shaw as anything but tech companies. They use technology as a competitive advantage in investments, much like Amazon uses technology as it's competitive advantage in retail.
Re: Forbes 400 Data Shows Paul Graham Is Wrong
#78Earlier quoted context omitted.
Tell that to Southwest Airways. http://en.wikipedia.org/wiki/Southwest_Airlines#Hedging_fuel Shuffling money around is also useful for making public what would otherwise be private information. Greece can profess to the world how solvent they are, but the swap market tells a different story.
I said "most of what they do" rather than "all of what they do" because some of it coincidentally helps others. The ratio of parasitic behavior to useful is unfortunately growing, and hasn't stopped just because it caused an economic meltdown.
What specific behavior do you believe is parasitic?
Re: Forbes 400 Data Shows Paul Graham Is Wrong
#79Earlier quoted context omitted.
Sounds reasonable. But when you have time it would be useful to see the actual lists of the people you put in each category.
Since the ecosystem of non-bootstrapped startups combine founders and financiers, where do you draw the line? VC firms seem squarely in the financier camp, and founders who do not contribute capital are not, but angels and incubators are more difficult. An honest classification attempt would attribute some of their equity to capital and some to work contribution, but even when there is currently a stable valuation av…
apsec112: I see your reply, but it is [dead]
I actually counted VCs as having made their money from technology rather than finance
You know my next question then: what is the financier/founder ratio if you consider VCs to be financiers?
Re: Forbes 400 Data Shows Paul Graham Is Wrong
#80This is a false dichotomy. The financiers who made this list were all entrepreneurs. James Simons, John Paulson, Steve Schwarzman, David E. Shaw, etc all successfully founded companies. Their companies just happen to be investment firms. The fact that more founders of financial startups have made this list in past decade than founders of tech startups speaks to the dominance of the investment industry in recent years…
Two of these (James Simons and DE Shaw) having started quant funds.