
Are You A Pirate? - GVRV
http://techcrunch.com/2010/10/31/are-you-a-pirate/
======
patio11
There is a lot to unpack in the idea that people get utility out of risk
itself. Personally I think many of them get utility out of things which can be
sensibly extricated from risk. A lot of folks relish the social aspect of
working in a startup (us versus the world, shared triumph over aversely,
counterculture as the norm, etc): I think you can replicate that without 90%
of them failing. (I hold other heresies such as that you can replicate it
without 90 hour work weeks, too - the ninety hour workweek is the talking
parrot, which doesn't really do anything for us but we know that it isn't a
_proper_ pirate ship without a parrot, and we cling to this even when it bites
our fingers and defecates on our pirate boots.)

~~~
jamesbritt
"the ninety hour workweek is the talking parrot"

Sweet metaphor. Thanks.

~~~
zackattack
I would love to see some counter-examples where 90 hour weeks actually do
power superior performance: investment banking; Mahalo.com; etc.

~~~
jacquesm
90 hour workweeks come with an undocumented feature, the < 50 years old heart
attack.

For a little while, say a couple of weeks it's ok to push yourself like that
it if it is actual work, and something you do not enjoy.

If your work is play to you you might get away with it. But anybody that
pushes themselves like that is going to find out a few things:

    
    
      - there is a price
    
      - the price includes an interest 
    
      - your 90 hour workweek is on a per-hour basis not as
        productive as a 50 hour workweek would be
    

Also, just like in computers, works smarter, not harder.

~~~
stakent
And ask yourself if you can effciently code, write, whatever for 90 hours per
week?

Then measure your effciency and act accordingly.

------
metamemetics
> _They don’t need to be rewarded for risk, because they actually get utility
> out of risk itself. In other words, they like adventure._

Completely flawed. Every sane person seeks to reduce risk. What entrepreneurs
also seek is to _maximize gains_. Increased risk is merely often required to
do so.

~~~
barrkel
I don't agree. "Sane" people introduces something which is frequently a false
dichotomy; whether you are driven by your rationality, or by more visceral and
deep-seated spirits. The problem is the difference between rationality and
enlightened rationality: what is good for you personally in the short term,
versus what is good for everybody in the longer term. These things can give
contradictory advice, and both can be labeled as rational. But the second
isn't intuitive to most people: it generally needs to be supplied from
somewhere else, usually emotions.

Let's say you need to get drinking water from the river, but there are
crocodiles down there too. If you minimize your risk, you'll get just enough
water for yourself. On the other hand, if you get more than enough water,
you'll be able to share your surplus, increase your social standing, find a
more attractive mate, etc.

Ah! you say - but the "minimizing risk" here isn't actually minimizing risk,
but increasing another risk, a risk that you'll never get anywhere in life,
won't raise a family and pass on your genes, etc.

But that's an intellectual risk. It's not likely to dawn on you unless you're
quite introspected, or perhaps until it's too late and you're in relative
middle age.

What if there was a different mechanism? What if exploring the boundaries of
your capability, your talents, was its own reward? You can't explore those
boundaries without risk of failure, even where failure might include death. A
simple mechanism for that could be risk homeostasis, whereby a certain
manageable amount of risk becomes its own visceral reward, attracting you to
those boundaries and encouraging you to expand them.

In other words, getting utility out of risk itself - "liking adventure".

~~~
metamemetics
> _What if exploring the boundaries of your capability, your talents, was its
> own reward?_

Then you're gaining something (discovery of new assets, freedom, happiness,
sense of accomplishment, self-actualization, etc.) and seeking to maximize
gains. Risk does not magically become utility. If gains are held constant,
nearly everyone chooses the one with less risk because it has a higher
expected value. Entrepreneurs are gain maximizers. Risk is only _ _utility_ _
in the case of masochism.

~~~
barrkel
I think you're missing my point. There are first order effects and second
order effects. Animals (including people) don't usually understand second
order effects very well; so we have evolved mechanisms to encourage us towards
desirable second-order effects, even when the first order effects may be
negative.

I'm pointing to the rewards of manageable risk as a mechanism - probably an
evolutionary mechanism - for exploring boundaries and thereby gaining things,
_even if you didn't know they existed_.

It's all very well to talk about the rewards of new assets, freedom etc., but
the reward from a risky venture isn't necessarily obvious; it may even be
utterly unknown in the history of human kind. But if the risk itself being
rewarding is a mechanism, it may encourage the discovery of such rewards.

The key misunderstanding problem here is the overloading of language. We have
this talk of rationality, of evolutionary psychology, of emotions and drives.
The key thing to understand, though, is that all may simply be different ways
talking about the same things.

I'm saying that _both_ things can be true: that it's rational consideration of
long-term goals that cause us to risk things; and that it's the intrinsic
utility of risk itself as encoded in the genome and proteome for the self-
directed organisms we call humans. What I think is _wrong_ is to take only a
single terminology, and use it to say the other terminology is mistaken.

~~~
metamemetics
> _What I think is wrong is to take only a single terminology_

Utility is a basic textbook economics term and the context of Arrington's
article. Also, Arrington was an economics major. I think sticking to one
terminology is _highly_ preferable over acontextual obscurism.

~~~
barrkel
Well, even staying within the bounds of economics, there are problems: are you
talking about homo economicus, or behavioural economics? The latter brings in
portions of the other systems into the economic model in order to better
reflect the workings of the real world organism.

Economics is about the study of choice; but we can split that up into at least
two broad categories, the most efficient choices, and the actual choices made
by people. You can stay strictly within a so-called rational model for the
first - and you must, in order to justify the inputs to your utility function
- but the second is experimental, and relies on observed inputs necessarily
defined by disciplines other than economics.

The insight of behavioural economics is that it's not so much rational
maximization of gains that drives us, but rather imperfect mechanisms
implemented in the organism, whose outcomes have been tuned by evolution to
approach rational maximization. Leaving out the behavioural aspect means your
model won't correspond as well with the real world, the only thing worth
talking about. And I'm asserting that seeking a certain amount of risk is just
one of those mechanisms.

~~~
metamemetics
If you want to go to Kahneman & Tversky, yes different heuristics people may
use for estimating risk and reward are probably biased estimators (although I
hope all pirate-entrepreneurs are using a little math and obtaining feedback
). That certainly does not mean risk, independent of gains, becomes intrinsic
utility for the non-masochistic.

~~~
barrkel
I think you're too wedded to one way of viewing things to open your mind, so
it's pointless to continue the conversation.

~~~
metamemetics
I studied cognitive psychology not economics ;) I'm familiar with the topics
your bringing up and agree they're interesting but also think they are
irrelevant to the issue of correlation vs causation and the red herring of
"risk" when looking at what motivates entrepreneurs.

~~~
barrkel
What's the opposite of risk? Most people would say safety; but I would say
boredom. Stimulation becomes repetitive if there's nothing at stake. It wasn't
for the expected gain of money that I bet on games during the World Cup last
summer; it was to make the games in which I had no personal stake interesting.
I don't know where you are, but internet betting is legal where I am.

I don't think appetite for risk is sufficient for entrepreneurial activity;
but I do think it's necessary. So I don't think it's a red herring.

------
jeffmiller
A fun read, but basically another "entrepreneurs are superheroes" article.

It seems unlikely that anyone would get utility out of risk itself,
independently of the reward. But many people, given the choice of two
scenarios with equal risk/reward ratios, tend to choose the scenario with the
higher risk numerator. "Bet big or go home".

~~~
andysinclair
Totally disagree, lots of people get utility out of the risk itself, and this
is the main theme of the article.

~~~
jeffmiller
Example?

~~~
whatusername
Extreme Sports? Utility from the risk itself is the whole point of Base
Jumping.

~~~
jeffmiller
Base jumping doesn't seem related to the article at hand.

~~~
barrkel
It's related to the utility of risk.

------
nanijoe
Let's just be clear here, pirates were thieves, not the swashbuckling heroes
we see in movies today.

~~~
rue
Pirates were robbers, not thieves. Thieves steal by subterfuge, robbers by
force.

 _This message brought to you by the Thief Anti-Defamation League._

~~~
metageek
So what's the common superclass?

(Personally, I'd say that robbers are a subclass of thieves.)

------
andysinclair
Wow, excellent article from Arrington.

I like the analogy, and I can relate to the attraction of spending your life
"at sea". The prospect of striking gold is not what attracted me to work for
myself, it is the lifestyle.

The unknown nature of startup life is also attractive. At my previous job I
knew I would be at my desk every day doing the same thing - now I have no idea
where I will be or what exactly I will be doing from week to week, and that is
very appealing to me.

And risk/reward? Who cares, just enjoy the adventure!

------
ericflo
Great article, and definitely a feel-good for people who are starting their
own businesses!

However, I wonder if all entrepreneurs are like he describes. In fact his
description is almost at odds with what Zuckerberg said at Startup School,
about simply building things because you like building things.

I think at the end of the day there's many motivations for doing something as
bold as building a company, and everybody has a different mix of those
motivations.

~~~
bbhacker
I can't help but think that that this statement of "building things because
you like building things" was very scripted at Startup School. The reaction of
the crowd was 100% predictable and it was a very smart move and completely re-
framed the movie and all the other bad publicity around Facebook.

"Their argument/story/point of view is not valid because they don't understand
that you can just build things because you like building things" - 100%
crowdpleaser. He is not addressing the issues, he is completely reframing it.

If you look for more examples check out the movie "Thank you for smoking": The
question is not whether smoking is good or bad for you or whether we knew
about that. The argument is whether we should make decisions for the people of
this country or if it is their freedom to make their own decisions.

~~~
fraserharris
Great insight bbhacker. Mr. Zuckerberg's quip did not sound off the cuff.

------
random42
_I don’t care if you’re a billionaire. If you haven’t started a company,
really gambled your resume and your money and maybe even your marriage to just
go crazy and try something on your own, you’re no pirate and you aren’t in the
club._

I do appreciate the risks pirates take, this however, does not devalue the
role of a peasant or a cobbler or a prime minister or a soldier to the
society. Its narrow minded to establish one work to be _better_ than the
other.

Be pirate, if you think, you are best suited for it. There is NO shame in
doing something else, for which you are better suited either.

~~~
robryan
He isn't saying one is better than the other. He is merely stating that there
will be certain things you won't be able to identify with that entrepreneurs
can.

~~~
random42
I do realize that he is not say this article, however I just feel that there
is a lot of false sense of grandeur associated with being a entrepreneur.

------
brisance
"It's better to be a pirate than join the navy"

<http://www.folklore.org/StoryView.py?story=Pirate_Flag.txt>

------
nikcub
This is what differentiates Arrington (and a rare few others) from a lot of
other experts/bloggers - he is writing from the trenches, from the bottom of
his heart/gut and from experience.

There are a lot of bloggers and self-proclaimed experts who are posers.

(Disclaimer: former tc employee)

------
michaelhart
This might just be my favorite post on TechCrunch.

~~~
messel
Posts from the heart are a potent brew, and that one certainly came from
somewhere deep inside of Mr. Arrington. Mike can say that it's not about
winning or losing, it's about playing the game now that he's "won".

------
davidst
For fools rush in where angels fear to tread. -- Alexander Pope

I've come to believe that people who create startups must be, by definition,
entirely unqualified for the job. If they were truly qualified they would have
some idea of what they were getting themselves into and they would avoid it.
Hence, only unqualified people embark on the adventure.

There is, however, an up-side to being unqualified:

The young do not know enough to be prudent, and therefore they attempt the
impossible, and achieve it, generation after generation. -- Pearl S. Buck

The young and foolish change the world.

------
jaxn
I completed a survey on entrepreneurship the other day for a local college
kid's project. There was a multiple-choice question asking why I became an
entrepreneur. The options were things like "being my own boss", "working from
a preferred location", and "making more money".

I had to choose "other" and write in "I can't not do this."

It is an almost uncontrollable urge. I think it could be safe to say that kind
of compulsion limits my ability to do a really good risk assessment. So far it
works for me though :)

~~~
gregpilling
I feel exactly the same way. Should I find myself with an extra million in the
bank, it would not change the feeling. There is a particular rush from making
your ideas into reality.

------
JofArnold
Might help to break down the concept of "risk" in this context:

\- Part A: Seeing a distant island full of fruit and thinking "Wow, I'm
totally going there - screw everyone else who's just eating potatoes around
here."

\- Part B: Choosing to make a boat rather than jumping straight in the sea and
risking drowning or death by shark.

So the goal itself is risky and/or unknown, but it doesn't mean you have to do
stupid or excessively risky things to get there.

There's a lot of overlap between scouting/explorer/pirate behaviour and
entrepreneurship - certainly for me. The very same thing that keeps me going
as an entrepreneur sees me exploring/climbing and hiking in dangerous but
beautiful places. It's an odd personality trait, but one that's evolutionarily
advantageous (now the islanders have all the fruit they need) :)

------
credo
I see it a bit differently.

For me, the risk-taking comes partly from a confidence (that could sometimes
be characterized as over-optimism) and partly from the feeling that my gains
from the risk are worth it.

I like adventure, but I don't fall into the category of "They don’t need to be
rewarded for risk, because they actually get utility out of risk itself."
people.

Taking a risk (e.g. quitting my (Principal Dev manager) job at Microsoft and
creating a startup) is rewarding in itself (regardless of how well the company
does financially). However, for me, the primary reward is not the risk. The
reward is what I get from taking the risk (e.g. work on more interesting
stuff)

------
siglesias
Ok all, we're going to settle this once and for all. I'll work with my prof
(behavioral economics) tomorrow to set up a risk profile questionnaire (like
an advanced Ask HN) and we'll know by Tuesday how well this claim holds up,
empirically. (edit: unless we're comfortable making claims about risk
preference WITHOUT data...)

edit 2: these are specialized, refined tests that construct risk preference
from a number of decisions from hypothetical situations. Assessing risk
preference is _not_ a simple manner of direct question (ex: "Hi, are you risk
tolerant or risk averse?") or introspection.

~~~
bali
Just because something is complicated doesn't mean necessarily that it's more
accurate or true (a funny illustration:
[http://www.southparkstudios.com/clips/360419/a-dream-
within-...](http://www.southparkstudios.com/clips/360419/a-dream-within-a-
dream))

I have constructed preference profiles with conjoint and other "complicated"
methods many times for big companies and believe me: they only scratch the
surface of human behavior, most of it is not valid.

Everybody may have his/her own reason for being an entrepreneur. I see this
discussion and Arrington's article as well (besides maybe preparing the ground
to quit:) more as an emotional discourse to justify why we do what we do. I
have these discussions with my friend and bus. partner all the time and I
really enjoy feeling superior to employees, but I know in the back of my brain
that it's somewhat unfair.

Anyhow, as for myself, I love to do it because of the lifestyle, because I
love to create something, because I can wake up late and work during the
night, because I am in control of my professional life and decisions and
perhaps most importantly because I hate to know what's gonna happen the next
day, next month which is inevitable with a normal job.

My life is over as soon as I am locked in a job + family + everyday routines +
stop being curious and open. I would die. I would know how it is going to end,
just wouldn't know when.

Just to avoid the latter and achieve the former I am risking right now nearly
everything stable I have had in life (friends, family, nice job ($1M in 5-6
years), house, perspective of a relaxed long life)

(don't misunderstand the family part, i believe that is the most important
element of a happy life, but it decreases your "degrees of freedom", if you
see what i mean)

Ah, that was the word I was looking for, freedom :)

------
andre3k1
_> Most people have an aversion to risk, my college economics professor told
me. Which means they have to be rewarded to take on that risk. The higher the
risk, the higher the possible payout has to be for people to jump._

Here's a followup question your freshman econ professor would have asked:

 _> Should we create incentives to reward entrepreneurs for their risk
aversion? Or should we leave it exclusively up to the free markets to offer
the reward?_

In other words, if an idea fails should society step in and help the
entrepreneur out (thus creating an incentive for him to further innovate)?

~~~
lunaru
Sorry, but society shouldn't have to bail out a failed social network for
puppies.

For entrepreneurship there is already enough reward for the risk. It's not
just monetary gains we're talking about. For one, you get to call the shots
and that's worth more to some people than money.
(<http://www.paulgraham.com/boss.html>)

~~~
edanm
"For entrepreneurship there is already enough reward for the risk."

Maybe that's true now, but it isn't a tautology. For example, pg has mentioned
that a few centuries ago, people didn't keep the wealth they made (it was
handed over to royalty), which made it so there were no incentives, which
severely lowered entrepreneurship.

Society has to work at making sure the balance of incentives is "correct"
(correct in the sense that that's what that society wants.) So asking about
one potential way society can help increase risk-taking is perfectly valid and
reasonable.

------
erikstarck
While I like the entrepreneur-as-a-pirate-rebel sentiment it's not the risk
that attracts me but the desire to change the world and build stuff that other
people find value in.

To build something that other people use is an ego boost.

To build something that other people _pay for_ is even better.

------
swah
Anyone else avoided these post thinking it was about Torrent or something?

------
mkramlich
When Arrington's on as a writer, he's on.

------
ditojim
yarr

------
messel
Ninja

------
adhipg
Is this a resignation letter? Are AOL listening?

------
mcritz
One less lawyer.

------
elvirs
looks like cash from AOL has really inspired Mike to advocate being pirate:)
just kidding :)

------
voodootikigod
This article is a flaming piece of crap, like most of techcrunch, designed to
do little more than inflate egos and rouse people to come back to the
profiteering gluttons that, by the way, make up most of his "circle of
friends". You want to see a better rallying call for change, try this:
<http://goo.gl/hMH8>

