
How to Steal a Billion - cjbest
https://oversharing.substack.com/p/how-to-steal-a-billion
======
CptFribble
That's the funny thing about Billions-with-a-b: normal thinking about money
and value just doesn't work IMO.

The Vision Fund is going to lose ~$19 billion. But Masa Son still controls
_over $80 billion._ That's more wealth and power than almost any human being
will ever have in history, ever.

At that point the numbers don't even matter. Maybe Neumann took Masa Son for
$50 billion. Who cares? A person can live in the USA for their whole lives
without working on as little as $3-5 _million._ Throwing billions around like
this, especially when it's digital/paper money in the form of stocks and big
corporate deals, really puts the absurdity sprinkles on top of this whole turd
bowl.

It's this kind of thing that makes people lose confidence in the system. Most
people out here are sweating medical bills in the low $10,000's, while the
news is talking about billions being gained and lost in the span of a few
weeks - so fast it makes you wonder if that amount of wealth really even
existed in the first place.

How much has to be "lost" between digital transactions before the numbers
become completely meaningless? A trillion? A quadrillion?

~~~
christiansakai
I am curious on how a person can live in the USA for their whole lives for $3
- 5 million. Serious question.

~~~
lifeformed
Really? $5M is $100k a year for 50 years. I can live comfortably off of $35k a
year a long as I'm not in San Fransisco or something. With just $1M I could
live indefinitely off investment income, which would be like $50k a year.
Double those expenses to support a family, and you're still under budget.

~~~
Red_Leaves_Flyy
$35k pre or post tax and what's your total tax rate?

~~~
lifeformed
Either one is fine. $35k post tax is super comfy and easy to do, while $35k
pre-tax is a little trickier, and would be 15-20% tax rate depending on your
state. Monthly budget of $1100 rent and utils, $300 food, $150 car, $60
entertainment, $300 misc, plus $150 for (bad) health insurance. That's
$25k/year. Not exactly a comfortable lifestyle but a few hundred dollars extra
in a few categories wouldn't dig into $5M much.

~~~
Red_Leaves_Flyy
Everyone's situation is different, but I wouldn't be so quick to assume yours
is reflective of most.

I take home 20k/30k, etr of 35%.

Everything else seems pretty far under average, or in the case of rent,
unrealistic. My prices are reflective of a high tax/cost of living city in the
northeast.

Just rent on a studio within a thirty minute drive averages $1k, only
including trash, snow.

Add $100 for basic cable internet.

Double that car cost, 150 almost covers gas and insurance. Doesn't include
paid parking. Some jobs and Some parts of the area can get public transport to
workfor them, I can't.

$60 is pretty low for a decent cell phone plan. Be more like 120 in reality.

health cares an extra $800/mo (after insurance pays) if I were to follow my
health care providers reccomendations.

------
yawaramin
Wow, this really drives home how absurd the whole WeWork thing was. And even
until recently people were talking about how apparently Masayoshi San was
playing some kind of three-dimensional chess and would come out the winner
from WeWork. A fool and his money are soon parted, I guess.

Also, the post title is a nice nod to an Audrey Hepburn/Peter O'Toole movie
dripping with '60s cool:
[https://www.imdb.com/title/tt0060522/](https://www.imdb.com/title/tt0060522/)

~~~
travisoneill1
To statistically show skill in investment it takes a whole lot more data than
the human mind assumes, so this is a common occurrence in the world of
finance. John Paulson, who became famous as one of the fund managers to make a
killing shorting mortgage backed securities, lost 50% in a year (much of it to
Sino Forrest, a Chinese fraud) a couple years later.

~~~
hermitdev
Yes, it is very difficult to actually judge skill versus just survivor-ship
bias. I worked for a hedge fund that had around $20B under management, lost
60% in 2008, then made all of that back in 18-24 months. Now, they're worth
50% more than loss. Are they skilled? I don't know.

------
travisoneill1
I object to the word "steal" being used to describe Adam Neumann's actions. He
did not take anything by force or deception (as far as I know). If I take a
piece of dog shit, spray paint it gold and sell it as a bar of gold, you could
argue that is "stealing" (or at least fraud). If I say "this is a piece of dog
shit that I spray painted gold but I am selling it for the price of gold" and
an adult of otherwise sound mind accepts the deal, that is not stealing. What
Neumann did is more like the latter scenario.

~~~
ninv
What Neumann did was unethical. He stole from We Work employees.

~~~
travisoneill1
How?

------
hashberry
WeWork/Uber/Airbnb... it's interesting how WeWork is classified as tech IPO
next to these (e.g. Softbank used its "technology fund" to invest in WeWork).
How did this happen? Isn't it an obvious real estate company? Is it because
WeWork appealed to tech startups and remote workers?

~~~
0xffff2
Isn't Uber an obvious transportation company?

Isn't AirBnB an obvious hospitality company?

~~~
6gvONxR4sf7o
It's an interesting point. If drivers are employees, I'd call them a
transportation company. If they aren't, I'd call them a tech company.
Analogous logic for Airbnb. But it seems like too subtle a distinction to be
reasonable. More likely, "tech company" just isn't a super useful label
anymore, with the grey area growing and growing.

~~~
bcrosby95
I tend to view tech companies as companies that consider custom tech a
competitive advantage and attempt to maintain in-house competency.

If you're a grocery chain and you contract out most of your technical needs
then you aren't a tech company. But if you're a grocery chain and you hire and
maintain a large technical team to provide you with various custom pieces of
technology, you're both a grocery chain and a tech company.

This could be any piece of tech: from custom software to custom refrigeration
systems.

~~~
beerdoggie
This is a great way to think about it.

------
cryptica
>> He saw an excess of capital in Silicon Valley and a raw, unsatisfied
ambition in SoftBank’s Masayoshi Son and his $100 billion Vision Fund

It doesn't take a genius to see this opportunity but it does take an
incredibly lucky person to be in a position to exploit it.

If Adam Neumann doesn't end up in jail after all this, then I will concede
that he is not an idiot.

~~~
dano
Adam was/is a promoter extraordinaire. He promoted a utopian future ideal
state to his investors and created an investment frenzy though build outs of
cool, edgy office space. He created a show and the investors came in droves.
He negotiated the investment rounds well and benefited from demand for his
product that caused the investors to let their guard down so as to not miss
out. The Fear of Missing out (FOMO) is a terribly strong force in the VC
community. Adam has set himself and his family up for generations and its all
likely legal.

~~~
cryptica
It says more about investor stupidity than it says about Adam Neumann. IMO,
most investors are pretty stupid. Like herd animals.

------
logfromblammo
I'd like to think that Adam Neumann will see some manner of ill effect for
paying himself $1 billion of other people's money, while delivering negative
value, but then reality comes crashing in to remind me that no, he won't.

Consequences are for people who don't have a billion dollars.

~~~
asdfman123
I'm going to bet that he has several months of hard reflection about life and
maybe write a book about it. Maybe he'll try to pull a Steve Jobs and try a
few new companies to redeem himself.

But you know, the next few years of his life are going to be mildly
unpleasant, and we shouldn't forget about the emotional impact about that.
Maybe he'll have a very public come-to-Jesus moment that will be cathartic for
everyone involved, or maybe he'll disappear from public life forever with his
vast WeWork wealth and live on some estate in an exotic locale.

But either way, this failure isn't going to be easy for him. He's going to
feel several emotions and not all of them will be pleasant.

~~~
lordnacho
I think this is overly optimistic, what you're saying.

What's he gonna lose? Friends who invested with him? He can buy new ones.

Feel bad? You can literally hire a whole team of therapists for life.

He can sit in his mansions and not be in the public eye forever, it's not like
being in the public eye is some sort of requirement for living.

Heck, he might even find a new following among people who want to emulate how
he grabbed all that money.

~~~
asdfman123
I'm intentionally being tongue in cheek. Unless he's a total sociopath (which
I don't think he is) he's probably going to suffer mild blowback, the kind of
blowback and shitty feelings us mortals feel when we've been ousted from a
job.

But it's the kind of disappointment and anger that you get over in a few
months.

The only difference is he'll have a billion dollars and the ability to do
whatever in life he wants.

If you were in his shoes, would you go back and do things any differently?

~~~
lordnacho
> If you were in his shoes, would you go back and do things any differently?

Maybe not hire a famous DJ for the announcement of layoffs.

~~~
asdfman123
Oh man, that's awful, have a link for that?

If this were reddit I would link to /r/aboringdystopia.

~~~
lordnacho
[https://www.businessinsider.com/wework-ceo-adam-neumann-
layo...](https://www.businessinsider.com/wework-ceo-adam-neumann-layoffs-
firing-tequila-shots-run-dmc-2019-9?r=US&IR=T)

------
zackmorris
I'm more concerned about the discrimination in finance/lending, which is
thoroughly entrenched at this point.

Anyone can borrow $50,000 for a new car, $500,000 for a new home, or
$5,000,000 in venture capital if they are connected enough. But there is
simply no money available for anything outside of mainstream status quo
thinking. That's why the Ubers and Airbnbs and WeWorks in these times are
founded on hustling and even skirting laws in some cases.

That's great and everything (I guess?), but I am personally tired of the
hustling/hacking mentality. I'd like to see real progress in the standard of
living for everyone in the world. That's founded on the idea of self-
actualization, that everyone has the modest resources needed to start their
own business or invent the things that help themselves and their communities.

How many people here have been on verge of financial ruin trying to get their
ideas off the ground? I've been up, I've been down, but overall I've basically
been running on empty for over 20 years. I'm tired of it. I didn't expect my
career to turn out this way. And I'm deeply concerned about a looming
recession forcing otherwise capable, intelligent people to scrape by
underemployed, doing menial work to make rent because there isn't enough
capital flowing. Because it's all locked up in a few wealthy peoples' hands,
who have a very Laissez-faire view of economics.

All of the above is why I'm almost certain now that hard times are coming as
early as next year. I've already been through it twice with the dot com bust
and housing bubble popping, and we're overdue for the next downturn.

^^^ Note that this wasn't always the case. There were protections in place
like the Glass-Steagall Act that lessened these boom-bust cycles, which were
overturned by the Gramm–Leach–Bliley Act and others. What we've been going
through with this vast increase in wealth inequality is by design.

I was born in 1977 so I remember when it wasn't this way. But many of you
reading this now were born after the corruption was instated and might not
realize how honestly affluent middle class Americans felt in the 1980s and
1990s.

It can be that way again, but please, look beyond private sector solutions to
these problems. The government is We the People, not some specter out to get
us. I know that many of you live in Silicon Valley and other big cities that
suffer from high taxes or government micromanagement, but I live in Idaho and
have seen how the lack of government can lead to widespread poverty and
environmental degradation.

Laws can change and movements do happen, which is why I'm optimistic that
reforms are also coming and that we might finally see some relief in the
2020s.

------
thedangler
So how do I get money from this Billionaire for my company? Not even looking
for a lot maybe 100k a year for 4 years.

~~~
oblio
I think you're thinking too small :-)

To actually get anything, you should ask for 10-15 million in seed capital.

------
buboard
fraud and stealing are different things

~~~
AlexandrB
Correct. ~$2 billion dollar fraud - collective shrug. Stealing a $7 toothbrush
(while being the wrong color) - prison.

------
mbesto
I like Matt Levine's take on this: (re: Adam Neumann)

 _If you want, you can imagine him as a diabolical genius who explicitly set
out to short the unicorn bubble and then walked away barefoot with a jaunty
whistle and $700 million of SoftBank’s money, but that does not strike me as
necessary or accurate. My model doesn’t require you to think that your startup
is dumb! You don’t need to worry about Neumann’s personal beliefs and
motivations at all, really. You can just think of him as a product of the
invisible hand of the market. A lot of money was pouring into startups, there
was a lot of demand, and the demand called forth supply, and the people who
supplied the supply got rich; it is elemental and straightforward and has very
little to do with questions like “is this a good business model?”_ [0]

 _“Capitalism occasionally makes huge mistakes,” is part of the story, but the
other part is that there are rich rewards for those who spot the mistakes and
bet against them. This is a lesson specifically of financial capitalism: In
most businesses you can notice a competitor doing a dumb thing and create
value by doing a better thing, but the financial markets are special because
you can notice a competitor doing a dumb thing and get rich by taking the
other side, without creating value or doing a better thing. If you notice that
people are buying dumb unicorn shares for too much money, you don’t have to
invent a better way of doing business or of funding companies. You can just
sell them as many as possible of the dumbest possible unicorn shares; when the
bubble bursts, you collect your winnings. This sort of thing—getting rich by
being smarter than your counterparties, making markets more efficient by being
on the right side of bets—is a classic path to wealth creation in the
financial business. Tech, traditionally, has a different ethos, one of getting
rich by changing the world. But sometimes there are crossovers, and anyway
maybe WeWork was never really a tech company._ [1]

[0] - [https://www.bloomberg.com/opinion/articles/2019-10-02/the-
tr...](https://www.bloomberg.com/opinion/articles/2019-10-02/the-trades-will-
be-free-now)

[1] - [https://www.bloomberg.com/opinion/articles/2019-10-23/how-
do...](https://www.bloomberg.com/opinion/articles/2019-10-23/how-do-you-like-
we-now)

~~~
asdfman123
I mean, maybe he was a genius fraudster, but maybe he convinced himself to
believe in what he was selling -- which made him all the better of a salesman.

~~~
gruglife
As George Costanza famously said “it’s not a lie if you believe it”

