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

How People Get Rich Now

paulgraham.com

Post reply on HN
Print view View original

931–940 of 941 posts

Re: How People Get Rich Now

#931

Post by TapWaterBandit »

jason0597 wrote: post #923
TapWaterBandit wrote: post #919

Earlier quoted context omitted.

Well duh, noone who has ever lived has willed themselves into existence. But just because you didn't will yourself into existence, that doesn't then imply that the circumstances of your existence are based on luck. My parents chose to have a kid, where else would I be born except in the country where my mother chose to live? There was 0 luck involved, I wasn't going to randomly pop into existence in Mongolia when my…

>If you apply your reasoning to any other area in life you can see how silly it is. If you put in a lot of work/effort into building a car, is the existence of the car the product of "luck"? After all it had no more choice in where it was created than a person. That is a false analogy. We're talking about you being born, not you putting effort into building a car. Why are you switching the argument around to where yo…

If you can't intuitively understand the relevance of where my parents live (more specifically my pregnant mother) to where I am born, then I am not going to be able to make you understand it.

You seem to be getting hung up on the fact that when two people decide to create a car they are creating an inanimate object (which they own in totality) and when they create a child they create a person with human rights and that will develop into it's own autonomous individual.

But this difference has absolutely 0 relevance to the question of whether or not the circumstances of your birth are the result of luck. Either they both are (which I think you can see is silly) or neither are (which is true but seems to be an idea you are resistant to for some reason).

Like I said at the start, this whole "the circumstances of your birth are luck" is a truism (in the philosophical sense) without any real thought put into whether or not it makes any sense. It could be luck in the deterministic sense of "the entire universe is pre-ordained" but if you believe in free will for the individual at all in any area, then the circumstances of one's birth are not luck.

Re: How People Get Rich Now

#932

Post by mike_hearn »

danielmarkbruce wrote: post #929
mike_hearn wrote: post #922

Earlier quoted context omitted.

For (3) it isn't required to have a moat. Market dumping is sufficient. Nobody is going to compete with a firm that's selling below cost, as Uber/Lyft are doing. But, I've used non-Uber/Lyft taxi apps that were perfectly competent. It's not that hard to build such an app, especially if you 'just' want to sell taxi rides in local jurisdictions instead of any conceivable moving service in every possible geography. If/w…

Uber is a public company. They do over 50% gross margins. One may reasonably suggest some of their marketing expense should be in the COGS, but even if you take all of it, they are still GM positive. Similar story for Lyft (also public). These stories persist, of companies deliberately running their companies so as to give away a $1 for $0.80 or whatever - but with very few exceptions it's a bs story.

Yet they make a loss. A $6.7 billion loss if I read their 2021 financial report correctly. I don't understand how you can spin this as "positive". Gross margin positive is not the same thing as being profitable, which is what we're talking about.

Re: How People Get Rich Now

#933

Post by danielmarkbruce »

danielmarkbruce wrote: post #929
mike_hearn wrote: post #922

Earlier quoted context omitted.

For (3) it isn't required to have a moat. Market dumping is sufficient. Nobody is going to compete with a firm that's selling below cost, as Uber/Lyft are doing. But, I've used non-Uber/Lyft taxi apps that were perfectly competent. It's not that hard to build such an app, especially if you 'just' want to sell taxi rides in local jurisdictions instead of any conceivable moving service in every possible geography. If/w…

Uber is a public company. They do over 50% gross margins. One may reasonably suggest some of their marketing expense should be in the COGS, but even if you take all of it, they are still GM positive. Similar story for Lyft (also public). These stories persist, of companies deliberately running their companies so as to give away a $1 for $0.80 or whatever - but with very few exceptions it's a bs story.

I think we've reached the depth limit here, so this is an answer to below.

I'm spinning it as positive because I'm attempting to break out their fixed and variable costs. If one looks through the line items and imagines themself as CEO, there are items which can easily cut and/or don't need to climb as revenue climbs. EG, their R&D is probably too high and doesn't need to double for their revenue to double. By breaking out their costs one can figure if they are likely to be "perpetual money losers" or just "currently money losers", which is the question at hand.

They are valued in public markets at over $100 billion. Usually the public markets do a reasonable job at getting a reasonable number for a company's value. Thinking about Uber's cost structure in some depth is how folks have arrived at that number.

Re: How People Get Rich Now

#934

Post by CRConrad »

aerosmile wrote: post #711
Kye wrote: post #707

Earlier quoted context omitted.

They find them for CEOs.

There are about 100 references on this page here alone stating that CEOs get relatively low cash comp in return for exceptionally high equity comp. Even CEOs have to treat equity as a form of compensation (duh!), and they have to trade off one against the other. Some people here also pointed out that Amazon would rather pay RSU, but people prefer cash. We all know that Amazon outperformed the market in the last coupl…

> There are about 100 references on this page here alone stating that CEOs get relatively low cash comp in return for exceptionally high equity comp.

No, there are references stating that CEOs get exceptionally high equity comp in addition to exceptionally high cash comp.

Win on the carousel, don't lose on the swings. They've set it up so they can't lose.

Re: How People Get Rich Now

#935

Post by CRConrad »

missedthecue wrote: post #744
PhilipTai wrote: post #709

Earlier quoted context omitted.

No. There is really no difference whether CEO is paid in cash or in stock, regarding the negative impact of the pay. Scenario 1: CEO get paid $50 million in stock. Scenario 2: CEO get paid $50 million in cash. And then the company raise $50 million from stock market, so that it will have the same amount of cash as scenario 1. They are the same.

Or they may not be able to raise cash, or they may be a private company without access to the stock market, or they may have bylaws preventing such a thing. Either way, the employee is not made worse off because the CEO collects a fat stack of options at the expense of the shareholder.

> Either way, the employee is not made worse off because the CEO collects a fat stack of options at the expense of the shareholder.

Of course the employees are made worse off by that: If the shareholders didn't give all that money to the CEO, they could give it to the other employees in stead and be no worse off themselves. The CEO uses up all the available potential for employee compensation at the expense of everyone else.

Your thesis is just astonishingly weird.

Re: How People Get Rich Now

#936

Post by CRConrad »

ladon86 wrote: post #366
idlewords wrote: post #268

Earlier quoted context omitted.

The front page giveth and the comments taketh away

This is a really funny and pithy description of both HN and reddit - and according to Google, you're the first person ever to say it.

Any hits for the grammatically correct form "The front page giveth and the comments take away"?

Re: How People Get Rich Now

#937

Post by CRConrad »

iur12 wrote: post #255
exhaze wrote: post #220

Earlier quoted context omitted.

Maybe one day, you'll even be confident enough to not make a throwaway account to say something like this.

This is kind of like a Clippy suggestion: hi there, it looks like you’re criticizing the forum. Would you like to establish a reputation on the forum?

How does one get to make more than three comments a day? Maybe that's why some people create new accounts, because they've filled their daily quota on the other ones.

Re: How People Get Rich Now

#938

Post by po8crg »

TapWaterBandit wrote: post #931
jason0597 wrote: post #923

Earlier quoted context omitted.

>If you apply your reasoning to any other area in life you can see how silly it is. If you put in a lot of work/effort into building a car, is the existence of the car the product of "luck"? After all it had no more choice in where it was created than a person. That is a false analogy. We're talking about you being born, not you putting effort into building a car. Why are you switching the argument around to where yo…

If you can't intuitively understand the relevance of where my parents live (more specifically my pregnant mother) to where I am born, then I am not going to be able to make you understand it. You seem to be getting hung up on the fact that when two people decide to create a car they are creating an inanimate object (which they own in totality) and when they create a child they create a person with human rights and th…

The circumstances of your birth are luck for you.

They are not luck for your parents but you are not your parents.

One of the problems here is that there is one position that everything is either the result of my decisions (ie under my control) or it is luck (ie it is not under my control) and another that defines luck much more narrowly.

Anything that happens to you as a result of someone else's decision is luck for you, even though it's a controlled decision for them. And you had no control over your conception because you didn't exist at the time.

Or, to put this in the simplest possible terms: "other people's free will is your luck".

Re: How People Get Rich Now

#939

Post by po8crg »

samatman wrote: post #625
ashtonbaker wrote: post #599

Earlier quoted context omitted.

This is a huge part of "start up culture" though - like any religion (or lottery, or whatever), superstition plays a large part, and the most important superstition is that those who have been successful before know how to do it again.

It's not religious to observe that founders who made a successful exit are well-poised to do it again. They're swimming in money, they have a bunch of investors in their phone contacts, and they know all the ins and outs from the last time they put a startup through its life cycle. How could they not be in better shape than some kid slurping ramen in his first YC cohort? This does leave two big wildcards: the idea (s…

> It is luck of a sort that someone is 2 meters tall, but I bet their parents were also taller than average, so saying that it's lucky that they were able to be a pro at basketball is going to confuse some people. There was no "them" before the peculiar genetic combination which conceived them, and after that, we're talking about some favorable circumstances (adequate time, a court, no crippling car accidents or stray bullets) and a great deal of hard work.

Hmmmm, I think it's obviously lucky. Luck in this context means everything in life that is not under your control (most things are part luck part control, of course). Since you did not exist when you were conceived, your genetic inheritance is obviously not under your control at all.

It's exactly equivalent to saying that someone with a genetic disorder is unlucky, which I think is a much more accepted valuation.

Certainly, the hard work is absolutely a fair point - within the universe of people who are over two meters tall with high hand-eye coordination (as someone 1.98m tall with terrible hand-eye coordination, I'm very conscious of how that affects sporting ability) those who work hard at sport are more likely to be successful professionals than those that don't.

There is a more subtle question about whether we should count the mental disposition to work hard, one that is likely in large part from genetic and social inheritance, as being luck. Some people are much better at it than others, and it does not seem to be the case that those who aren't can become much harder working purely through an effort of will (somewhat, by will and regular practice and it becoming habit? sure. Reaching the level of those who are doing so anyway? No). So is that disposition a matter of luck? If it is, what does that mean? What do we do differently as a result? Do we say that it doesn't matter how hard people work, they should be rewarded the same? Obviously not. So what does that actually mean?

Re: How People Get Rich Now

#940

Post by po8crg »

WalterBright wrote: post #733
bobthepanda wrote: post #681

Earlier quoted context omitted.

Stockholders are increasingly not putting up with it. Votes against are still kind of rare, but they do happen: https://www.restaurantbusinessonline.com/financing/starbucks... But also, the board makes CEO decisions, and it's not totally uncommon for board members to also be CEOs of other companies, so they buy the kool-aid because they also benefit from it. Plus, CEOs and boards don't exist in a vacuum. You've got t…

The stockholders can revolt. If they don't, and it's their money being handed to the CEO, is it reasonable for non-stockholders to gripe about it?

Almost everyone owns stock in all the major companies - indirectly via their 401k or index fund.

To a first approximation, there are no non-stockholders.

One real question is why, when stockholders vote on CEO compensation, fund managers are allowed to cast the votes of fund investors. If you invest money on behalf of other people, there are all sorts of fiduciary duties to keep the money separate, but that money gets you votes, and you get to vote them according to your personal preferences, not according to the preferences of your investors.

Post reply on HN