
“It’s hard to take risks if you don’t have a safety net” - boramalper
https://twitter.com/eastdakota/status/1129929178382446592
======
DanielBMarkham
Twitter wins again.

We keep reducing these complex multivariate social issues to simple cause-
effect situations then beating one another up over what the simple cause is.

When we're doing definitions, the key phrase is "necessary and sufficient" In
this case, being rich or poor is neither necessary nor sufficient since we
have plenty of examples of things working out with either of these two things
being missing. So really the discussion is much more like "Does condition X
provide a 3 or a 4 percent boost?"

But that's not as fun to argue about.

We oversimplify life and public policy-making at our own peril.

~~~
devy
> In this case, being rich or poor is neither necessary nor sufficient since
> we have plenty of examples of things working out with either of these two
> things being missing.

You are totally missing the point Matthew Prince is trying to make, that is,
you need to have a "safety net" before you can take risks. If one can't even
get them fed and not worrying about what the next meal is and where to stay,
all bets are off.

If you don't agree with me, name one entrepreneur who has found a startup that
exited successfully(IPO or Acquisition) by now and that the founder(s) were
living below poverty line or on social welfare. Borrowing money from parents
doesn't count as living below poverty does it? Having parents or friends or
family to lean onto economically means there is a safety net there.

~~~
skookumchuck
"Rowling has lived a "rags to riches" life story, in which she progressed from
living on state benefits to being the world's first billionaire author."

[https://en.wikipedia.org/wiki/J._K._Rowling](https://en.wikipedia.org/wiki/J._K._Rowling)

Oprah's another:

[https://en.wikipedia.org/wiki/Oprah_Winfrey](https://en.wikipedia.org/wiki/Oprah_Winfrey)

~~~
InitialLastName
Neither of them "founded a start-up" while living below the poverty line.
Rowling wrote a book in her spare time that eventually got popular. She wasn't
putting any money or asking of anyone else's money to fund her book.

Oprah followed the more usual path of "get a job, get promoted, rinse repeat"
until she was a household name before she started her own company. Per the
article you yourself linked, she was co-anchoring the local evening news at
19. That isn't the same thing as taking a risk on a start-up.

~~~
skookumchuck
Writing a book while on welfare is certainly a startup. She didn't self-
publish the book. The publisher provided the funding to edit, print, market,
and distribute the book (which is not trivial money). Rowling pitched the book
to several publishers before one decided to fund it.

Oprah bootstrapped herself out of poverty to become a media billionaire. You
might say she took the long way by routing through various jobs to get the
money, but she still came from poverty, founded companies, and became a
billionaire.

------
snowwrestler
PG seems worried that tweets saying you have to be rich to do a startup will
discourage non-rich folks from trying a startup.

This doesn’t give those folks much credit. It implies that a few tweets will
have a bigger impact on their decision-making than their own detailed
understanding of the constraints and anxieties of their own lives.

I don’t think PG is in a good position to understand those constraints and
anxieties. And he is somewhat incentivized not to, since YC benefits from
having more startups to choose from. But YC does not experience significant
downside on the startups that they reject or which fail. Unlike: the founders
of those failed startups.

~~~
csomar
I'm not an expert on the subject but according to "science", the reason that
woman do not go to engineering fields in the US is a byproduct of their
environment not a difference in their genetics.

If I got it right, Robert Sapolsky claims that the way to make more woman into
tech is to make young girls believe that they can do tech. They already have
the cognitive capacity.

In this same sense, PG might be hitting the nail in the head: The reason poor
people don't do startups is because they believe they can't; and that it is a
white privilege.

If they believe they can't, they will not try. If they don't try, the
probability that they succeed is exactly %0. Re-enforcing the myth and further
convincing poor people not to try.

The only way out is to convince them otherwise and see what the real odds are.

Robert Sapolsky also claims that we need to change our speech and views (ie:
remove "negativity") in order to level the playing field. PG is doing the
same. He thinks that other ideas need to be censored as it is important to
maximalize the propaganda.

That's a dangerous thinking as it touches on freedom of speech. One might
wonder if you can level the social "cognitive" field while also preserving
freedom of speech. Educating people is the only way I guess.

~~~
noelsusman
They won't try because the consequences for them could be disastrous. It's not
even about how much money is in your bank account, though that obviously
helps. It's more about how stable and reliable your support structure is.
Without that the consequences of failure can be devastating.

I think it's dangerous to encourage people to gamble their lives on a low
probability outcome if they don't have a strong network of friends and family
to fall back on. If you have that, then go for it, but don't pretend that
anybody can pull themselves up by their bootstraps and do what you did (I'm
using the royal you here). That attitude is what the criticism is aimed at.

------
DevX101
They're talking past each other. Thing is, they're both right.

Paul seems to be saying you don't have to be rich to do a startup.

Matthew is saying lots of founder have some resources (family home, savings,
great education, i.e. middle-class) that made doing a startup feasible

Both these positions are true and aren't incompatible. Being middle class
(Matthew's position) and prudent with savings can afford you probably a year
of runway.

But I'd never recommend someone who was truly destitute or food insecure to do
a startup. If you come from a poor family there will also be family/cultural
pressure not to do a startup and instead get a good paying job(assuming you
have the ability).

~~~
shafyy
The problem is PG says that you don't have to be a rich kid, and then takes
Airbnb as an example where the founders are definitely rich kids compared to
the rest of the nation and world (not rich as in "daddy has a private jet",
but definitely in the top couple of percent).

Of course PG is right that you don't need to be a rich kid, but he chose his
anecdote poorly.

PS: Also Sam recently said (in the StrictlyVC interview) that most founders at
YC are from upper middle class families, so there's your data.

~~~
grenoire
Worldwide, definitely top 0.1% (at approx. 80K annual income).

~~~
Someone1234
Worldwide is an unhelpful metric. They're starting up in a specific place, so
their wealth should be measured relative to that location.

For example 80K won't get a roof over your head in NYC or Silicon Valley, but
could support an entire family in middle-America.

~~~
shafyy
It should be measured within the geographic bounds of where you can relatively
freely and easily move within. If you're making 80k, maybe don't live in San
Francisco (or do, but then you need to cut back other expenses).

And yes, I know, it's not easy to move for everyone to another city or region
because of several reasons, but generally speaking most Americans could move
to another region where they would get a similar paying job and more value for
their buck.

Edit: Typos

------
mattxxx
The reality is that money lets you "take risks," and money gives you options
(in this world).

To be honest, I don't think that starting your company with the "risk" that
you might move back in with your parents if it fails... is _at all_ a
meaningful risk.

~~~
zpeti
Psychologically this is not true at all. It's much easier to take risks when
you have nothing to lose.

How many 18-30 year olds do you see having a swing at it and trying something,
vs 30+ people with families and savings to burn?

~~~
theplague42
Most successful startup founders are in their 30s and 40s.

Providing a link: [https://www.kauffman.org/what-we-
do/research/2009/04/educati...](https://www.kauffman.org/what-we-
do/research/2009/04/education-and-tech-entrepreneurship)

~~~
zpeti
That's not actually relevant to what I'm saying.

The more relevant question would be, what % of 20-30 and 30-40 year olds start
businesses?

I'm not surprised most become successful over 30, it takes time to learn.

------
PandaRider
I'm shaking my head right now because I can't believe people at the top is
still susceptible to sampling/survivorship bias.

I've tried searching but cannot find a good empirical study of privilege and
entrepreneurship correlation. However, I've found an essay paper [0] that
_exactly_ predicted this twitter drama; that entrepreneurs simultaneously
present and erase this conversation about class and entrepreneurship.

The paper also concluded:

> Whereas gender, together with race, have long been foregrounded in studies
> of entrepreneurial identity and difference, class may be a more powerful
> organizing discourse, though certainly one supported by discourses of gender
> and race.

[0]
[https://journals.sagepub.com/doi/pdf/10.1177/135050841246489...](https://journals.sagepub.com/doi/pdf/10.1177/1350508412464895)

~~~
KaiserPro
The only data I can get is this: [https://www.kauffman.org/what-we-
do/research/2009/04/educati...](https://www.kauffman.org/what-we-
do/research/2009/04/education-and-tech-entrepreneurship)

93% had a degree, with 30% having a masters, That would suggest to me that
you'd need a decent wedge of cash.

Now, what is interesting, is that in 2016 at least, the US created gross 960k
new companies (there is some smoothing here, so +- 100k) The UK created 460k.
Seeing as how the UK is 60 million, versus 300 million people, either the US
is under performing, or the UK is wildly over performing.
([https://www.sba.gov/sites/default/files/advocacy/2018-Small-...](https://www.sba.gov/sites/default/files/advocacy/2018-Small-
Business-Profiles-US.pdf) and
[https://researchbriefings.files.parliament.uk/documents/SN06...](https://researchbriefings.files.parliament.uk/documents/SN06152/SN06152.pdf)
for stats)

Perhaps, as we don't have to worry about healthcare or no competes, that might
be a factor.

~~~
rahimnathwani
Registering a company in the UK, and keeping it running, is both simpler and
cheaper than in the US.

Registering a company takes a few minutes and costs less than $30. Compulsory
annual filing costs less than $20. If your company's revenue is below some
threshold, you don't need to register for VAT (similar to sales tax). And
there's another (even higher) threshold below which you can file very simple
annual accounts (unaudited, and including neither income statements nor cash
flow).

~~~
brianwawok
Eh, in my state in the US it is like $85 every 2 years for a LLC and
essentially no paperwork if a simple pass-thru. Not everyone needs a Delaware
C-Corp from day 1.

~~~
Reedx
Nice. That's a lot simpler than CA. Here there's paperwork, more complicated
taxes and $800/yr for a single-member LLC.

------
tluyben2
Everyone from my country (NL) has a safety net to start with (you can screw up
but still) and that goes for many EU countries anyway and yet all the
entrepreneurs I know from NL are extremely risk averse compared to the US
ones. Most of my NL friends are entrepreneurs but more of the lifestyle kind
than even wanting to become the #1 in their field with the monetary status
that comes with it. I dare to say that I only know Chinese and US
entrepreneurs that look beyond getting more than few million on their account
and that is it.

I wonder why that is.

~~~
kaybe
I wonder too.

One idea I have: In these countries you don't really need that much more
because you're already cushioned against risk. You also don't need to provide
a cushion to anyone around you (since everyone's taxes are already doing
that). Which means, below you is not the gaping abyss but a shrub that is a
little bit thorny.

------
cbanek
Pretty disappointed in PG's response:

"I would ordinarily just let your bullshit go, but this myth that you have to
be a rich kid to start a startup is terribly dangerous, because it discourages
people who aren't from trying it. Brian Chesky's parents were social workers.
That is not a rich kid."

As if having two parents with stable jobs isn't considered a safety net. I
agree, you don't need to be rich, but I also agree if you are struggling to
work enough to eat, you aren't really working on making a startup.

There are huge swaths of people with a much less stable safety net than the
example he provided.

~~~
bko
This is a kind of No True Scotsman fallacy. Anyone that is successful was
'advantaged' because her family was rich, or she had two parents, or she had a
parent, or she was born in America, or she was born with the right number of
chromosomes... The whole conversation strikes me as just snarky and reductive.
I don't see the point. Why not try to promote a conversation to lift people up
and empower them rather than writing off the hard work and perseverance of
others?

~~~
wastedhours
> Anyone that is successful was 'advantaged'

> Why not try to promote a conversation to lift people up and empower them
> rather than writing off the hard work and perseverance of others?

I think these two can live together - if you succeed, there was something that
allowed that. Whether it was privilege, whether it was luck, or timing, or the
right application of hard work and a blend of them all.

It's important to recognise what advantages are best leveraged for success,
and then we can optimise to ensure most people have access to it.

In the argument in question, what advantage did Airbnb's founders have that
allowed them to take that risk? How did they get the flat they were struggling
to pay for in the first place for example? Why did they not skip rent and have
to work 3 part time retail shifts to cover it like large swathes of workers in
a similar boat.

Identifying privilege is an important piece of the puzzle - noone succeeds
solely by hard work alone (otherwise all coal miners would be millionaires,
and 996ers would be everywhere), so if we can spot the factors that successful
people leverage, we can support others to get there (whether that's better
education, cheaper housing, familial support etc...).

------
skrebbel
It's a nice mini soap opera but the core is that actually they agree but have
a different definition of "rich kids".

~~~
rlue
I agree, and would go a step further to say that the response to PG is
woefully exaggerated. The fate of the poor is truly deplorable in the US, but
that doesn't mean that every conversation about risk, opportunity, and
entrepreneurship has to rise to the defense of the disadvantaged.

PG is saying you don't have to be rich to launch a successful startup. By
this, I believe he means private-school, summer-house, frequent-flyer-miles-
in-your-early-20s rich. I would contend this is at least 90th-percentile rich
for US households.

His critics suggested he be sensitive to those who literally have no safety
net, and could not move back in with their parents if it all came crashing
down—I would contend this is at most 40th-percentile "rich" for US households.

Can we cut the guy some slack and let him speak to the 50+% of people in the
middle? Honestly, that's undoubtedly where the bulk of his target audience
resides—people who'd like to launch a startup but worry that they're not
sufficiently privileged to do it.

~~~
njepa
> By this, I believe he means private-school, summer-house, frequent-flyer-
> miles-in-your-early-20s rich.

The example given literally attended one of the top private art school in the
world. The reason people are reacting is likely because of this often damaging
non-differentiation of being temporarily and perpetually poor. Many people
can't even afford to move to a city these days, let alone start a startup. And
if they do it might have negative consequences for years and years.

~~~
rlue
Fair point, I stand corrected.

------
bryanrasmussen
I think if Paul G. came out a little less strong at the beginning - without
'bullshit' \- this wouldn't be an issue.

On the other hand there is the habit nowadays of having to guard and specify
ones statements zealously in order not to get called out for something a
reasonably lenient reading would allow, but calling something 'bullshit'
probably doesn't get you into that other hand category.

~~~
adamlett
Idk, it seems to me that PG is just wrong about this. Not categorically and in
every single instance, but on the whole. It's like saying women are physically
stronger than men, and pointing to some woman who is clearly an outlier. You
could word it less strongly and say that _some_ women are stronger than _some_
men. But then what would be your point?

~~~
tomp
He's saying more something along the lines of "women can be elite performers
_too_ " (and that being genetically/on average less strong shouldn't stop them
from trying) - which isn't entirely wrong, especially since we're _already_
talking about like 0.01% of the population (successful entrepreneurs / elite
sports(wo)men).

~~~
adamlett
Don't get blinded by the analogy. There's an important difference between it
and the problem we're discussing: We can't actually change the fact that woman
generally are not as strong as men. We can however as a society change the
fact that many people don't have a safety net. I appreciate that Paul G's
intended meaning was different, but it's kind of hard not to interpret what he
wrote, as _no, we don 't actually have to change society [which has worked
well for me], poor or underprivileged people just have to try harder_.

~~~
tomp
You’re just painting your own bias over his words. How about interpreting what
he said _literally_ i.e. “even poor people can start businesses” instead of
misinterpreting him as “against social nets”?

~~~
zepto
If you take him literally, I.e. without the social context, then his
statements is essentially meaningless.

All it would take is one single example of a poor person being successful
while all of the others fail and die in poverty to prove him right.

His example is part of the context, and the fact that his example was not in
fact of a poor person demonstrates that he isn’t being responsible for what he
says, and deserves the criticism he is receiving.

------
huffmsa
Easier, sure. Not having a backstop means failure == death. Which isn't for
the faint of heart, but that's the story of almost every Americans lineage at
some point in the past. It takes a bit of luck, but rarely is it more luck
than nose to the grindstone effort.

My anecdotes:

I have one great-great-grandfather who thought he had an office job in British
Columbia, but by the time he sailed from England and crossed the continent the
company had folded. But his family was already on their way, so he started
working every mining job he could, and invested every spare pence he had into
real estate. His sons did the same.

My paternal great-grandfather came over from Italy, got harassed out of NYC by
the Irish, bought a small farm in Oklahoma, and his children did the same.

~~~
bubblewrap
That seems overly dramatic. Not everybody who loses their job dies. Most
people seem to not die in that situation, actually.

Failing at your startup would at most be equal to losing your job. You won't
die just because of that.

Even if you end up in debt, there are insolvency laws. You can just go
flipping burgers for a couple of years and be good.

~~~
huffmsa
Of course it's recoverable. If you're under 35 you can join the miliary as
well. There are options. Not glamorous, but survivable. Better to have tried
and failed than to never have tried.

But when you're an Italian who can't speak English or out west in the late
1800s, it was a case of with your shield or on it.

------
praptak
A poor person betting everything on their startup is definitely good for pg -
it increases the pool of people whose work he can profit from.

It's not that obvious if it's good for the poor person. I guess that everybody
has their own risk aversion threshold.

~~~
ekianjo
A poor person not betting on anything is bound to stay poor. Your point is?

~~~
hef19898
Isn't that oversimplifying the whole social issue of why people are poor, stay
poor or become poor?

~~~
ekianjo
Strawman. I was answering the previous point: betting is probably a reasonable
choice when you have not much to begin with. I would not make a 2 lines
comment to explain poverty as a whole.

~~~
brain5ide
No. Betting is a reasonable choice when you, like a VC can bet on a ton of
options and still have cash left for immediate problems. All other times,
betting is playing your luck and bound to fail.

~~~
hef19898
First, I don't want to read to much into the OP regarding betting. Because
there is something to it. Without risks no rewards. Yet what constitutes a
risk and a reward differ significantly based on your resources.

That being said, risking some of your resources, money, time, whatever, to get
out of poverty is reasonable. Betting on a start-up might not be. Simply
because if it goes wrong instead of rewards there might be debt and even worse
poverty.

~~~
Retra
>Without risks no rewards.

This is a fallacy. The vast majority of people are rewarded for minimizing
risk, not taking it. People justify extra risk for disproportionate reward,
not reward in general. You have to take risks if you want relatively
_unbounded_ returns. Getting out of poverty does not require that at all.

------
nemonemo
A close cousin of this topic would be the background of new full professors in
major universities. Ph.D. is risky, especially considering the slim chance of
getting the full professorship and its tremendous opportunity cost. The
competition to become a full professor in a major institution is fierce and
also it takes longer and longer as the competition heats up. The path is quite
comparable to that of the unicorn founders in many ways.

I'd wonder how much study has been done around the socioeconomic backgrounds
of those prominent professors. I'd also be interested how those backgrounds
have been shifted as time goes by. It would be also interesting if not much
research has been done about it when some of them are supposed to do such a
thing.

------
CPLX
A story where a billionaire downplays the problems created by wealth
inequality. How novel.

------
jasonkester
Silly Twitter fight aside, the key piece of advice that us regular non-rich
folk should take away is this:

"Your first goal after university should be to build yourself a safety net."

Once you have $10k in the bank, you can start taking risks just like those
privileged kids that are starting all the startups with their unfair
advantages.

Best of all for us, we work in software, where socking away your first ten
thousand dollars happens automatically after landing an entry level dev gig,
provided you don't go out of your way to blow your entire outlandish salary on
silly possessions.

~~~
fucking_tragedy
$10k is hardly a safety net.

~~~
rb808
Yeah I was going to say 10k is a trip to ER after a small accident.

~~~
asark
Our terrible health insurance situation makes potential spending any given
month very _bumpy_. $10k should be enough to keep a single, frugal person in
an OK situation for a good chunk of a year, at least, but could just as well
be blown inside 24hrs by one slip on some ice or any number of other ER-worthy
problems, and isn't enough to cover a healthcare plan that removes much of
that uncertainty for any length of time while also paying rent and buying
food.

------
jacquesm
How do countries with good social safety nets factor in here? In EU people are
definitely not nearly as likely to start their own business as in the US, and
many people that would otherwise be labelled 'jobless' (or on the dole) are
'self employed' instead.

~~~
KaiserPro
This is demonstrably untrue.

Looking at the official docs here:
[https://www.sba.gov/sites/default/files/advocacy/2018-Small-...](https://www.sba.gov/sites/default/files/advocacy/2018-Small-
Business-Profiles-US.pdf) for the US and here:
[https://researchbriefings.files.parliament.uk/documents/SN06...](https://researchbriefings.files.parliament.uk/documents/SN06152/SN06152.pdf)
for the UK (both are PDFs)

In the USA for the first quarter of 2016, there were 240,000 new companies. So
just million in a year, assuming that trend. Also, that is all companies,
including those with no employees

in 2016 for the UK in the whole year, there fore 416,000 new businesses, all
of which had at least one registered employee.

The USA, in 2016 only created twice as many companies compared to the UK.

Given the gulf between population _and_ economy, I would say the US is
significantly underperforming compared to the UK

~~~
jacquesm
The UK and quite a few other places require gig economy operators to register
as an independent business.

~~~
pjc50
I don't think that applies to this stat, though; gig economy workers are
required to register as self-employed for tax and NI purposes, but that's not
the same thing as being a business, which I think in those stats requires one
of VAT (turnover higher than a threshold of £85k) or PAYE (employing someone
else).

------
majani
Actually the headline of this is the takeaway you should get from this story.
People with safety nets are the ones who get to do startups. This is logical
and how it should be. If you weren't born into a rich family, then make saving
up your number 1 financial priority to build that nest egg for yourself. Even
the kids from privileged families are mostly in that position because their
parents made a series of good financial decisions in regards to savings.

------
jkingsbery
For whatever it's worth, there was a recent episode of Econtalk in the guest
discusses his work with those below the poverty line and how some communities
have been successful in entrepreneurship:
[http://www.econtalk.org/extra/discovering-positive-
deviants/](http://www.econtalk.org/extra/discovering-positive-deviants/)

I don't know of a quantitative study and obviously the source is biased, but
the guest came himself from a "no safety net" situation and now works with
others in a similar situation, so his take is interesting even if one
disagrees.

------
Entalpi
I like to think Swedens extensive social safety nets are a factor to the large
number of startups here.

~~~
dudul
How does this large number compare to the US? Genuinely interested. Having
lived in a few EU countries before moving to the US, I've always been under
the impression that creating a startup in the US was way easier/more common.

------
taytus
Fuck the rich kids. And I'm not saying this as an insult. I mean it as "good
for them". In terms that I'm 38 years old and I have enough maturity to know
that:

1-Life isn't fair 2-Some people start the game 50 tiles ahead of you.

None of these reasons are going to stop me (a poor entrepreneur) to build the
company I want to build.

I think PG's comment is idiotic, but I think he is very smart.

------
kstenerud
It's easy to take risks when there's little to lose.

If the only fallout is wasting some family money and at worst delaying your
entry-level career by a couple of years for some experience that many
employers consider valuable anyway, there's little downside to throwing the
dice.

~~~
throwaway55554
> It's easy to take risks when there's little to lose.

> If the only fallout is wasting some family money and at worst delaying your
> entry-level career by a couple of years for some experience that many
> employers consider valuable anyway, there's little downside to throwing the
> dice.

This, in no way whatsoever, resembles the conditions of the poor.

~~~
kstenerud
That's right. It doesn't.

------
RickJWagner
It makes it easier to launch a startup if you've got a strong safety net, but
not impossible.

I think the article misses the point, though. Look at Bill Gates-- he had rich
parents, and so he started Microsoft. Which has gone on to make millionaires
of lots of ordinary folks and continues to provide good jobs to many, many
people today. It's a good system, it benefits a lot of people.

------
csomar
> “It’s hard to take risks if you don’t have a safety net”

Okay, here is a twist: How much do poor people spend on lottery/gambling
activity? How much is that proportionally to their income?

From looking at small casinos, betting shops, lottery and online sites
(sports) it seems that poor people are risk takers. One reason, in my opinion,
is that they have little to lose. They also have really shitty lives and are
looking for an escape.

If you were starting a startup alone in Bangladesh vs. starting solo with YC
in SF. Building a remote-based startup that sell SaaS online for clients all
over the world. Location of clients is everywhere.

Technically, the playing-field is equal. You start a C-Corp from Bangladesh
and trade your business. But which one do you think will make it? Which one do
you think will raise funding? Or succeed if both do not raise funds?

You live your life trying the optimize a problem. There is a number of steps
that if you take, carefully, you'll become rich in some duration of time. You
don't know these steps, so you keep searching. You know gradient descent. Life
is like that, if you are moving successfully down, you are probably on the
right track and so you keep moving on that direction.

However, you start stochastically on a random location and keep trying to find
a path that leads somewhere. That's where YC comes in. They help you reduce
the surface area of your search. You are less likely to land somewhere futile.

What poor people are missing is discovery of this surface area. It is a very
complicated problem for them and they lack resources and education to optimize
the problem.

They are hoping that this lottery ticket will help land them directly on the
optimized spot. Their lack of understanding of why this doesn't work explain
why they can't navigate the surface area.

~~~
vec
Of course people have different risk appetites, including poor people.

The point isn't so much about "risk" per se, it's about whether or not there's
a viable Plan B.

If I'm working two jobs to barely keep a roof over my head and play the lotto
and lose, I'm still keeping a roof over my head (by working two jobs). The
odds are long, but the cost of failure is low.

If, on the other hand, I have the Best Startup Idea Ever (and all the
necessary skills to make it a reality) then I will still be unable to pursue
it. Sure, I'm like 80% certain it's going to be a huge success, but in the 20%
case I'm fuuuuuuuuucked so taking a swing at it is a nonstarter.

------
simplecomplex
The world isn’t fair. Pontificating about how the world isn’t fair is useless.
It’s a waste of your time.

Both Paul and Matthew would be more helpful by providing advice to effectively
deal with one’s situation in order to found a company. That would be valuable,
instead of engaging in adversity olympics which is what most of Twitter seems
to be nowadays.

------
programminggeek
It's not taking a risk if you have a safety net. That is the point of the
safety net, to eliminate the risk.

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bettrsocial
I don't think anyone else should pay for a startup's safety net. Doing a
startup requires calculated risk. It may or may not work. Whoever wants to
attempt need to sit down and calculate the costs and the risks and take
precautions. This is not the same as someone becoming unemployed because they
got laid off, and it's not the same as providing welfare to people in poverty.
Startups by their nature are risky and no one else should have to pay for a
safety net in case it doesn't work out. The market does well weeding out the
bad ideas and companies that aren't actually solving any problems. Creating a
safety net might just contribute to perpetual "startupdom" (with everyone else
paying for it), when in reality certain ideas and efforts need to just die
off.

------
carlsborg
He said hard, not impossible. You're playing with a higher difficulty level,
because you need to spend time and effort and divert your focus on mitigating
the worst case scenarios instead, and market timing is one of the big factors
in getting it right.

------
umvi
So why aren't highly socialized countries with tons of safety nets meccas of
innovation?

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gaspoweredcat
exactly, its a different matter when that risk isnt "oh ill lose a bit of my
buffer" but "if this doesnt work im on the streets"

you may have a fantastic idea but if youre working for min wage theres a good
chance youre little more than one missed pay cheque from being in serious
trouble

but those from privilidged backgrounds see it differently, many of them have
never been "broke" and i mean truly broke so i guess they simply dont
understand what theyre saying, theyve never taken an actual risk in their
lives

------
richardriko
If you are in india the emotional blackmail and the pressure to marry before
30 is a huge hindrance. In india a graduate has no real world knowledge when
he gets out of college. It takes about 6 to 8 years to get the confidence in
coding and creating something. But by the time the marriage is done and no way
to take risk. To be honest the salary earned by women is like an additional
income and never considered primary income in 99 percent marriages.

------
bg24
Experiencing first hand. I hope at this age, I should have saved enough. But,
single income and mortgage means better be realistic. I do take risk though,
working for startup on cutting edge tech, than for a large company. Basically
insurance for future job security. The risk I cannot think of is starting my
own business.

Related - it is impossible to take risks if you or family have crippling
health issues.

And when you have both, why even bother to take major risks.

------
AlexTWithBeard
_I had to borrow money from my mom to pay my taxes_

I would agree that in some US locations the taxes are a bit too high...

~~~
KaiserPro
or that lump sum taxes are somewhat perverse (see PAYE in the UK)

------
mcguire
Is anyone keeping statistics on YC applications?

What happens to people who don't get funded (by YC or otherwise)? What happens
to those who do get funded but then fail? What proportion succeed, for various
definitions of success?

------
RenRav
This a common debate point for basic income, providing the safety net for
entrepreneurs, startups, artists, etc. Really was expecting a mention but it
seems to have shifted toward boring arguments about privilege.

------
PorterDuff
The original twitter post, twitter responses, and responses here made me muse
about how the definition of 'start-up' has changed in the last few decades.
Ennui ensued.

------
slowprogrammer
PG and Matthew are talking past each other here.

PG is defining "rich kids" as the spawn on the 1% and is arguing that these
kids don't have any significant advantages over more normal people when it
comes to accessing funding from VCs etc and that such a belief is harmful.

Basically that there is a point of diminishing returns to being "rich" and
that it's probably lower than you think.

Matthew is arguing that being in crushing poverty is probably a barrier to
building a successful startup.

Both views can be basically correct.

------
commandlinefan
Well, that's not really a risk then, is it?

------
idlewords
Let's not forget that Graham has also publicly written he would be loath to
choose any woman as a startup founder "who had small children, or was likely
to have them soon." The man has a type, and the demographics of YC reflect it.

~~~
_Microft
Do you maybe have a source for it?

~~~
altaccount1
Footnote 2 of this Paul Graham essay:

[http://www.paulgraham.com/start.html](http://www.paulgraham.com/start.html)

~~~
_Microft
Thanks. I'm sure I had read that before, it's surprising that I didn't notice
that yet.

------
nswest23
r/murderedbywords

------
skookumchuck
By definition, it's not a risk if there's a safety net.

------
Tycho
When someone uses the word “privilege” it’s a good indicator that the rest of
the discussion is going to be a waste of time.

~~~
sfkdjf9j3j
Can you elaborate on this?

~~~
crankylinuxuser
Not parent.

But in my experience, but "privilege" usually relies on invoking stereotypes
(males, females, white, etc) and then shutting down individuals by invoking
that their discussion is just 'privilege'.

I saw a 'yelling over each other' thread on Facebook in which white feminists
were being name-called by black feminists calling them names of various sorts
for supporting only white rights. Any modicum of discussion was drowned out by
chest-beating of lines of racism and sexism. I believe that thread is still
going on.

"Mansplaining" is yet another term that does that on sex based grounds. The
term "manspreading" is yet another term with a sexist root- as only men can
sit down and spread their lags in relaxation.

------
julienfr112
It depends also of your lifestyle : if you can't leave without buying
expensive stuff, going in vacation in French Polynesia and skiing in Aspen,
the safety net should be $100k or $1m. If you can leave in a cheap
neighborhood, cook your own food, reading books and HN, doing cheap sport like
running or cycling, $10k can take you a long way. The revenue and/or lifestyle
of your significant other is also a huge factor.

------
bubblewrap
Most people, even poor people, have parents who would help them out in case of
need. They seem to be discussing a pretty low bar here.

And of course it is a "privilege" to have supporting parents. So what? If you
don't have that privilege, what are you supposed to do? Kill yourself?

I think such privilege discussions are rather silly. What's the point? That
people should be showered with tax payer money to even out their privileges?
Or people with bad parents should be given state assistance (substitute
parents)?

~~~
KaiserPro
I'd suggest you think more deeply.

All parent, regardless of class/richness want to be supportive. the question
is what support can they offer? Sure, a sofa, most people have that. But thats
not a long term solution. What if your parents don't have any savings, how
will they help you with that debt?

They can't

Its not an issue of will, its an issue of possibility.

Now, I intensely dislike the use of "privilege", as its more often than not
tool to stop discourse. But, to assume that every parent is _capable_ of
providing long term accommodation, financial, transport or other support is
shore sighted at best.

I suggest perhaps you might want to expand your social circle, so you can see
this sort of thing first hand.

~~~
bubblewrap
I was thinking of the basic "moving back in with the parents fallback".

Of course different people have different advantages and disadvantages.

Paul Graham's children will probably have an enormous head start in becoming
entrepreneurs. They'll have "startup privilege" en masse. But so what? Should
we begrudge them having it? Should we compensate children of other parents for
the non-privilege of not being Paul Graham's children? And if so, how? What
amount of money would be appropriate? Or should we punish his children to take
away their unfair advantage?

I just think the whole "privilege" mindset is unhelpful and unproductive.

Try to make the most of what you have. Can only PG's children become
successful founders? I think not. Maybe your children will only become
millionaires if the become founders, and PG'S children will become
billionaires. Cry me a river.

