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How to get rich in tech (startupljackson.com)
309 points by sirteno on Dec 24, 2015 | hide | past | web | favorite | 190 comments



"And if you go in with this mentality, even when startups fail, you succeed. If you put five years into building a company and team, you will end up with a great network of talented and motivated people, lots of first-hand experience, and often some management experience as well. Worst case, your next step could be going into Google at the VP level it would’ve taken you 15 years to get to joining out of college to “inject some startup DNA,” and catch up on salary within a few years. Unless this internet thing is a fad, that job will always be there for you."

This advice is quite precise about where it applies. If you're at a startup that is undercapitalized, working you 12-16 hours a day, 7 days a week, with poor management and no opportunities for anything but building and maintenance, you can actually wind up worse off than when you went in: no built-up network and nothing that would make you "VP at Google" material, and in the case of startups doing pay cuts (in an environment of ever-rising rents), even less money than when you started(!) He is referring to working at "decent or better" startups; problem is, you may not know you're not working at one of those until you actually work at another one.

The rest of his advice is probably worth listening to, but the above part should be considered very carefully.


So this happened to me. I believe it 100%, but it's nowhere near as straightforward as you may believe after reading this.

The reason is that if you want to work hard for a startup, you need to ditch the role mentality. You have to be all in on the company, all day. You have to think like a CEO without being a CEO, and without access to all the information that comes with it. You also don't get comped for it immediately.

My path:

- Joined a company just as they got seed funding. Wrote code for 1.5 years. Constantly fought to understand why we were building what we were and where I could cut corners while still being proud of my work.

- Company got acquired. Took as job as sales engineer. Gave 6 demos a day for 9 months.

- Asked to scale my role. Turns out that's product marketing, so hired my replacement and moved to marketing. 2 months in, we fired my VP and I started reporting directly to CEO. Did this for another 7 months.

- More marketing churn, I ended up running marketing (team of 2). 1 left, hired 4 total more over 8 months.

- Decided I was leaving, told my CEO with 6 months notice. Ran the search for a new CMO (obviously the CEO had final say, but we didn't have many significant disagreements).

At every one of these steps, I freaked out about my ability to perform. I'd be up in the middle of the night, or stressing about not understanding anything. I wasn't leveraging my skills -- I was stepping into gaps the company needed filled and backfilling the roles I was leaving.

If you can find a company that will let you do this, you come out with an AMAZING skillset. I'm 30, and I haven't tested my ability to get a VP-at-Google job, but I'm not finding anything in starting my own company that's a total surprise. The breadth and exposure I got from trying different roles at a startup every 6-12 months has been frighteningly valuable.

You can't stay heads-down and think writing code is all the your startup needs. You need to think like a founder for 5 years, without any of the upside, and you'll get a huge amount of intangible value from the experience.


I did this for several years, and it didn't give me anything near VP-at-Google skills, maybe "VP-at-so-so-company" skills. I was in charge of development, systems administration / DevOps, SEO (got multiple things to the top of Google), some management (of non-technical freelancers, because I was the only full-time technical person), and a variety of other "fill in the holes" jobs. This was after multiple stints at other small companies (but not 5 full-time people small.)

I got some things out of of it, no question, but absolutely nothing compared to what I would have gotten at a high-quality company that had reasonable hours, plenty of capital, very ambitious people (no one who worked there is anywhere near technology now - most are 9-5 or non-technical consultants), interesting technology, etc. The most important thing I got was "be incredibly careful about who you work for and what promises you choose to believe", but saying to people "don't be naive / foolish" is easier to say than it is to evaluate the intentions and capabilities of founders / companies. The second most important thing would be the ability to say "I've been through the wringer before."

The quality of companies varies wildly, and the wrong environment will do very little for you. Some wind up at ones near the bottom of the quality pile and having the ability to recognize that you're at one isn't a given.


>>I haven't tested my ability to get a VP-at-Google job

People don't generally 'apply' for a 'VP-at-BigCorp' jobs. They either enter the game through their network, or get promoted in house.

Which is why it all comes down to how much good your network after a while. No matter how good you are, which college you went to, who are your friends etc sort of stuff matters way more than what the person can actually do. If anything, the real capability of the person may not even matter, most big companies run like well oiled machines, some one at the top is needed only to prevent what might be 'obvious' mistakes.


> If you want to get rich, your best bet on a risk-adjusted basis is to join a profitable and growing public company. Google for short. Make $200-500k all-in a year, work hard and move up a level every 3-5 years, sell options as they vest (in case you joined Enron), and retire at 60, rich. This plan works every time.

I'm pretty sure that is the only part of the advice that wasn't a joke.


I thought that advice was entirely tongue in cheek...


Most people get 'rich' slow and steady rather than overnight ...and by 'rich' those that are financially the best off typically don't look like it. They drive a modest car, live in a modest home, have nice but not flashy things.

3 main rules to live by:

1. The easiest way to increase your ability to save (other than a windfall inheritance) is to earn more money. Live a balanced life, but make sure that focus includes a strong career track with 1, 5 and 10 year goals. As has been discussed elsewhere at length, popular culture likes to play up the person that worked at a startup and sold their options for millions. This is very rare (most options are worthless or end up being worth less than the cash one gave up in the form of a lower salary to get them). Most 'rich' people are those that work hard and earn above average salaries over long periods of time.

2. As soon as practical, at every stage of your life live below your means. This isn't practical early on when some people are just scraping by, but once you start earning some real $$ learn from times when you had less $$ and live happily well under your means. If you earn $150k, live like you earn $100k. As one earns more it's fine to spend a bit (maybe you have a somewhat expensive hobby). Saving every penny eating beans and rice your whole life is no way to live. However, so long as you live well under your means you'll do very well. One of the biggest mistakes I see high earners make over and over is that they increase their spending as fast or faster than they increase their earnings. I can't tell you the number of "millionaires" I know that have trouble paying the electric bill some months. Don't fall into this trap.

3. Invest, but do so in a diversified and conservative fashion. Slow and steady is the key. Trying to "get rich quick" is also an easy way to "get poor quick." Build a reasonable pool of assets and invest when the market is up or down, just keep investing throughout your life. The math shows time and time again that people are horrible at timing the market. When everyone was in a full blown panic in 2008-09 the smart person just kept investing. Every $ the they invested is now worth 2-3x. Those that panicked and pulled out or stopped investing missed out big time.


You got my upvote for this one sentence: Trying to "get rich quick" is also an easy way to "get poor quick."

I bought individual stocks, made a lot of money in a short time, then lost it just as quick. So i moved to leveraged mutual funds. Made crazy money real quick, than slowly lost it as the market became more volatile. Then I switched to just plain old index funds. I make a modest return in comparison to those leveraged funds, but when the market turns, I've lost less than a modest amount, so overall it has proven more profitable.


Some of the best advice I've read in this thread so far. I'd recommend reading:

1. The Richest Man in Babylon

The $7.89 I spent on this book, which I read in a single night, is the best investment I ever made.

2. Think and Grow Rich

An older book, but there are some golden nuggets within.


So you got rich?


No, but he sure did think about it!


Mr Money Mustache and Jacob of Early Retirement Extreme offer some food for thought on reducing expenditure and investing the savings.

I can't say I've adopted the whole thing, and the tax structure in the UK seems to be less advantageous to this strategy than the US, but I've foudn reading it has dragged my spending down and savings up - mainly by raising the question of what do I really value enough to spend my money on it.

1. http://www.mrmoneymustache.com/ 2. http://earlyretirementextreme.com/


As usual, slow and steady with tried and true methods is the way to go. Startup wealth has too much luck involved. Great post in my opinion.


   If you want to get rich, your best bet on a risk-adjusted 
   basis is to join a profitable and growing public company. 
   Google for short. Make $200-500k all-in a year, work hard 
   and move up a level every 3-5 years, sell options as they 
   vest (in case you joined Enron), and retire at 60, rich. 
   This plan works every time.
I don't think this is great advise. Not everyone is able to join a company like Google due to either luck or their capabilities. I also find being rich around 60 years pointless, since you've wasted too much of your life working for "the man" at that point.

I think a better approach would be the following:

1. Become freelancer.

2. Do what you love and do it well. If you're passionate enough about your job you should be able to increase your rate over time.

3. In western european countries: aim for at least 100.000 EUR a year.

4. Live cheap and save up. Invest the cash you don't need at any moment in real estate (house) and index funds.

5. Travel around the world and find a nice cheap country you could enjoy your life in.

6. Emigrate once you have enough money to live comfortably in your country of choice.

---

That's my plan at least. Currently I'm on a 'holiday' (2 months) in Thailand. I figured the following:

- In Thailand one can live (bare minimum) for around 500 EUR a month (some Russians in my co-working space live from that amount).

- Property can be bought for around 50.000 EUR in Pattaya. Not really huge, but decent with shared gym and swimming pool in apartment complex.

- 100.000 EUR invested in indexfunds should net me on average around 6% a year after taxes, i.e. 6000 EUR a year or 500 EUR a month (7% historic average minus ~1% tax).

- With no monthly rent to pay, I'm should be able to live a bit more comfortably compared to my Russian co-workers here :)

- I could fully focus on personal software project and hopefully that will add to my income over time.

---

I won't be financially rich, but I would have financial independence and could do what a love in a country with nice weather, good food and nice people - it's another form of wealth.


I'm more-or-less doing this now too, here's a few problems I've run into:

- Visa renewals. Leaving the country every 90 days to renew your tourist visa gets old fast.

- Finding a country that is both stable and has a low cost of living. I was in Bangkok during the last revolution when the current military junta took over. The airport shut down and I had to take a bus past a lot of guys with machine guns to get out of there.

- Starting a family changes things. Poor countries have poor education systems. I enjoyed my visit to Pattaya, but wouldn't want my kids passing by "walking street" on their way to school.

- You lose some small niceties like Amazon Prime and Hulu :)


I've been through this whole thing. Where I am now is I'm older and living in Thailand with a wife and kid.

When I was younger I had the same big ideas about traveling while earning a living as a single guy; current fashion is to call it being a "nomad". There are more and nicer coworking spaces now but it's still just working during your vacation.

I ended up grinding at a big tech company, saving/investing a lot more than other people who were living it up, and then retired (very) early. I also grew up a little during the process and wanted more than just an ocean view and party life. That happens to most people, although not all as you can see with a trip down Walking Street.

Life in Thailand works for me and my family. No visa runs if you have a spouse or retirement visa. Most modern conveniences are available. Speaking the language with a good accent helps a lot.

But costs are surprisingly high if you want a "normal" life. Cars are way overpriced due to high tarrifs. Electronics are pricey as are many western foods. My kid goes to an international school, which is really the only viable option for education, and that costs about US$10,000 per year. Real estate in the US varies greatly in price, which means someone like me who wants to live away from a city could get a ranch in the southwest US quite cheaply. But in Thailand land prices are kind of high almost everywhere. We have land near Khao Yai National Park about two hours from Bangkok; it's very nice up here.

Long story shorter, life changes a lot as you get older; you want different things. The advice in the article worked for me. If was to do it over again I would be tempted to try the "nomad" life as a freelancer. But knowing what I do now I would probably repeat what I did - work for 20 years at big tech co, take nice annual vacations, save a lot, retire early.


I've been through this thought process myself & my conclusion was that a lot of the eastern side of the EU (including eastern Germany) is not a bad compromise between fairly low cost of living & decent infrastructure/public services.


What countries do you have in mind?


I currently live in Berlin which is getting borderline expensive (still much cheaper than almost any major western city - more so now with the weak euro). I've heard good things about the Czech republic and Bulgaria. Seems like Croatia isn't bad either.


Don't forget Romania :-)


Yes but a beer and a sausage for lunch will really cut into the afternoon productivity. :)


> Visa renewals. Leaving the country every 90 days to renew your tourist visa gets old fast.

You can go to, say, Poland. It's just slightly more expensive than Thailand. No Visa renewals.

> - Finding a country that is both stable and has a low cost of living. I was in Bangkok during the last revolution when the current military junta took over. The airport shut down and I had to take a bus past a lot of guys with machine guns to get out of there.

EU countries are more stable.

> Starting a family changes things. Poor countries have poor education systems.

Poland scores very high in terms of education. No district schools BS.

> You lose some small niceties like Amazon Prime and Hulu :)

VPN :D


>You can go to, say, Poland. It's just slightly more expensive than Thailand. No Visa renewals.

Is that meant literally? And for how long can one stay there as a foreigner? How about working remotely from there for companies outside Poland - allowed?


> Is that meant literally? And for how long can one stay there as a foreigner?

As an EU citizen, forever. For everyone else, the same rules apply as always. Working for companies outside Poland shouldn’t be an issue either way, you just still have to tax your income correctly?


> VPN :D

I've tried but Hulu even blocks VPNS :(


Despite beeing more expensive (think double or triple the 500$ figure for a comfortable life, depending on the particular country you choose), south european countries might be a good alternative. You get more stability and much better education and health systems, while keeping the good weather and lower cost of living.


You could do the same thing working at google, but instead of making $108k USD/yr, you would make +$250k/yr USD. Your time to target savings number would be greatly reduced. Then you can leverage that into a remote work position as you work from home in some cheap country.

You can also buy a condo in las vegas for $50k USD too. You still have a developed country where you can speak the language and the bay area is a cheap one hour flight when you need to get more work.


>You could do the same thing working at google, but instead of making $108k USD/yr, you would make +$250k/yr USD.

Not everyone can just waltz into Google. For starters, there are tens of millions of developers worldwide and only tens of thousands of total Google jobs across all roles.

Google, Amazon, etc. all have a well known high false positive rejection rate, so even for developers who are qualified and would do well at these companies getting in still requires a good bit of luck. Their interviews are not bias free either, so a subset of good developers are facing a process biased against them. Those with families, for instance, probably have little time for hackathons that I'm sure help with in person or phone screen coding exercises.


Project Euler / TopCoder help far more with the interviews than Hackathons. Hackathons are 100% useless for training for $BIGCORP interviews.


As OP said it's one thing to be financially rich, but there are other forms of wealth. The idea of working 10+ hours a day, 5 days a week (if I'm lucky), 50 weeks a year for the next 40 years just doesn't appeal to me. You are right you could earn more at Megatechcorp, but by freelancing I can work on stuff I find interesting and still live life on my terms.

Also getting into a company like Google isn't something that everyone can do, where as it's pretty easy to start freelancing (especially if you are European, hence don't need to worry about healthcare).


But I said nothing about working 40 years. I just said you could do the same thing faster working at google than being a 100k freelancer. Most freelancers I know live a pretty variable life where you get feast & famine cycles. And when it's feast time, it's long hours time. It can be more stressful than being an employee too.

You can also work pretty interesting projects at a place like google. If you want to do platform library type work, the only kinds of places your likely to get that kind of work is from a place like google or other larger companies.

I think most software engineers could get into to google if they put the effort into it. If you can make it as a $100k/yr software freelancer, you could probably study 'cracking the coding interview' and make it into google.

Also realize that google hires in europe too.

The hours isn't what you think it is. There are many 9-5ers that do good work at places like apple and google. And there are other teams that work a lot. It all depends on the team. People also get more than 2 weeks vacation too. For example, the entire engineering org at apple at least gets 3 weeks of 'mandatory' vacation. One week for thanksgiving, 2 weeks for christmas. Then you have your normal vacation on top of that.


> The idea of working 10+ hours a day, 5 days a week (if I'm lucky), 50 weeks a year for the next 40 years just doesn't appeal to me.

I used to think like that when I was 20. One thing I've learned (will be 40 soon) is that the time passes anyway.

If you're lucky, you'll get to be 60. You don't want to be poor when you're 60. Of course, you don't want to delay gratification unduly, but beware of doing the opposite.


I don't get why people (who haven't worked at these companies) think everyone works 10+ hours at these companies. I have worked at one of the big tech companies before. I probably got 6 hours of real work done per day (including meetings), the other 2 being spent eating, snacking, or dicking around.


I think what is often overlooked is that you can live in the US in a nice place and it will be cheap, at least by European standards. Assuming you can sort out visa issues.


> I don't think this is great advise. Not everyone is able to join a company like Google due to either luck or their capabilities.

The original posts which prompted this one was centering around the super-engineer who can control their own destiny and work for any company they want. Nothing in this post applies to the average engineer.


The old fixed vs growth mindset at work. There is nothing to stop you becoming an exceptional engineer, except your beliefs of course.


Of course there is. First, there is your biology. You might simply not be intelligent enough to become a great engineer. If you set the cut-off for greatness at "published a widely influential paper" or "designed a large distributed system from ground up" this becomes even more the case. You might not have the health and the endurance to work on demanding high-end projects long enough to get really good at those kinds of projects.

Then, there are the social factors. Your other obligations, like raising children, can get in the way, though you might say they are more manageable than intelligence and health.

Growth mindset, beyond the "bloody obvious" [1] interpretation of it, is not something you can state as self-evident, and evidence to support the stronger interpretations is quite scarce.

[1] http://slatestarcodex.com/2015/04/10/i-will-never-have-the-a...


> First, there is your biology. You might simply not be intelligent enough to become a great engineer.

Biology is overrated. From "You and Your Research"[1] by R.W. Hamming:

"You observe that most great scientists have tremendous drive. I worked for ten years with John Tukey at Bell Labs. He had tremendous drive. One day about three or four years after I joined, I discovered that John Tukey was slightly younger than I was. John was a genius and I clearly was not. Well I went storming into Bode's office and said, 'How can anybody my age know as much as John Tukey does?' He leaned back in his chair, put his hands behind his head, grinned slightly, and said, 'You would be surprised Hamming, how much you would know if you worked as hard as he did that many years.' I simply slunk out of the office!"

Other anecdotes lead me to believe the primary difference between those that are and those that might have been is hard work.

> You might not have the health and the endurance to work on demanding high-end projects long enough to get really good at those kinds of projects.

Bad health is a rough deal for anyone. But it is possible to succeed in the face of it. Look at Goddard[2]. There's a good argument that he didn't reach his full potential because of his health, but he still did some truly great rocket science.

> Your other obligations, like raising children, can get in the way

Rather than get in the way, I think they are often essential. I imagine it must be hard to do great things if you're personal life isn't in good shape.

There are real obstacles to "greatness", I think. Things like access to education and financial security. But I find it hard to believe that biology, health, and domestic life are enough to stop a dedicated person from performing great feats.

[1]: http://www.cs.virginia.edu/~robins/YouAndYourResearch.html [2]: https://en.wikipedia.org/wiki/Robert_H._Goddard


Geniuses have a greater ability to work hard productively and efficiently.


If you actually read the grand parent I was talking about an average engineer becoming amazing. It's 100% possible.

You have added a whole load of random obstacles to our average engineer, like making him in poverty, setting him the goal of greatness and suggesting he's sick.

I'd agree that he probably need to find a job that pays better, get well and have smaller goals before he succeeds.


Tell that to a chimpanzee. Then tell that to someone with down's syndrome. Then tell that to someone who was malnourished as a child and whose brain just plain doesn't work as well as yours. It would astound me to find that there were no inter-person variations that significantly affected ability-to-engineer-exceptionally. I'm not going to claim that there are people who fundamentally cannot become exceptional engineers, but I will claim that there exist people who start off so disadvantaged that the life circumstances necessary for them to achieve that goal are so unusual as to never occur - pseudo-illegal nootropics, adopted by best family on earth, elementary school teacher is burned-out tenured physicist, etc.


Obviously my comment here missed the mark! I thought we were talking about an average human engineer getting a well paying job at Google?


Sorry! It's possible that I missed some context, yes. I kind of skimmed this thread and fixated on your post because it seemed like it was making a rather extreme claim.

If you're already a good engineer, then it's much more likely that you can become a great engineer. I'm still not convinced that every good engineer can become a great engineer. Maybe most? I know that I have a memory-related lack of attention to detail that I've never been able to get rid of entirely, regardless of adherence to lists and standards and specs and so on. I basically can't maintain an event-driven workflow and it causes problems. I've gotten around it by going into mathematics and programming, which are relatively stateless, but I can easily see myself reaching "good" engineer status but not "great" engineer status.


What are the areas you need to focus on to be good? Mine are definitely tests, specifically mocking actual write events happening (or rather stopping them from happening) in an API I have built. It'd be boring if I wasn't learning new things though right?


Testing is an issue, yes. Making sure my tests are comprehensive, making sure my environment is set up in a way that makes the tests valid (that is, that I'm going through the right code paths) and verifying such, remembering where all the appropriate checklists are ("oh, right, that was testing a Y, I need to do checklist t_Y"). I occasionally have to make an extra commit because I forgot to stage a line or a comment. Stuff like that.

I've largely dealt with it by moving into CS theory and AI (which have less of that) and by using Google's reminders system (inbox, now, keep) to deal with the remainder. Just, whenever I have to do engineering, it's always going to be more difficult for me, and since I'm damn good at math there's no real reason for me to focus on engineering beyond the level where the other things I'm doing don't take hits from it. And unless I manage some kind of transformative pivot or redefinition, it'd be pretty stupid for me to focus on being a great engineer, and I'm not sure I'd be able to. I certainly am never going to be as good an engineer as I could be a computer scientist.


'Nothing'? Well, except a fuckload of experience, probably. Either spend 4 hard years at a top university or 10 years of consistent, hard work doing it all by your lonesome, maybe with and maybe without the benefit of being able to 'practice' at work. I don't think all it take is 'belief'. There is some actual hard work to be done.


Except that startups won't hire you once you get that experience. Look at their team pages, and struggle to find the one person over thirty-five.


Being born in the right place helps a lot.


> I also find being rich around 60 years pointless, since you've wasted too much of your life working for "the man" at that point.

Most people in the US will die having never been rich by any measure and having never done any better than living paycheck to paycheck, at best. 25+ years of wealth at the end of your life puts you solidly near the top of the pile.

And financial independence anywhere in the world is a whole different ballgame than living "rich" in a developed country (particularly the US).


Once you are rich at 60 there is some small chance that there will be life extension products available. (for some serious dough of course)


At the moment, lifestyle (nutrition/fitness) & social connections seems to be the key to living to 100.


interest on 100K won't cover visiting your family, having children, or any safety net if you get sick, unfortunately. Also a conservative fund return is more like (a volatile) 4%, and subject to the whims of 'previous performance doesn't predict future performance' (e.g. even that 4% can't really be relied upon).


I understand, but those numbers were from my perspective. I don't have a girlfriend or kids. And one should be able to overcome minor sickness, though I do realise there's a risk. I believe when you're still young and healthy you should occasionally take a little risk to (hopefully) achieve your dreams.

My dream is to be financially independent and work on my own software projects full time.


Do you consider yourself a machine or a human? Became from outside it sure looks one way.

I'm guessing you're relatively young. What I wished I'd learned earlier is the future comes faster than you think, and the earlier you start planning and saving for it (partner, children, ill health) the easier it is.


I dunno why, but I've trouble connecting with women and even if I do connect, at some point I'm afraid I'll get bored. And I've never seen much reason to get kids myself. So perhaps in that aspect, I'm more of a machine.

I'm 34 now. I've dealt with some heavy stuff. Lost my parents and a sister in a car accident when I was ~20 years old.

I agree that the future comes faster than one might think, which is why I'm in such a hurry to achieve my dream future before I'm 40 years old, so I got still plenty of time to enjoy it. My little sister certainly didn't get the chance to live her dream future.


GP was being obnoxious. To be human is to follow your personal calling, which might include building a family, or might not.

The trick is that your calling may change -- many children young folka grow to desire children, many lonefolk grow to desire a partner or would be happier with one -- so it helps to prepare for potential changes in your motivations and desires. Saving money is a great way to prepare to change. As is investing in a marketable skill.


I am also 34 and have much the same plan as you, just I had to revise the figures a few times as I had kids :) The increase in required house size + university = loads more cash required to be financially independent. If you know for sure those things won't happen then maybe you can go for 100K. Still, old age could become expensive, we won't be young and healthy forever. You basically need more than 100K so that you have an upward trend continuously to old age. You can't just cover your costs on the interest (and 6% is dangerously optimistic). Good luck to you though.


Hey, how are you going with the problems you talked about here? https://news.ycombinator.com/item?id=10169937


Hey, thanks for asking! The thread was encouraging that it wasn't time to change fields; I'd say I'm making quiet progress.

Since then I've spent a lot more time thinking about what I want to be doing: work has been slack so I've had fewer chances to see how I now am decomposing software. But I've started to enjoy programming again :)


>100.000 EUR invested in indexfunds should net me on average around 6% a year after taxes, i.e. 6000 EUR a year or 500 EUR a month (7% historic average minus ~1% tax).

Really? That's a better return than I'm seeing averaged over 10 years.


He also doesn't take inflation into consideration.


Or market volatility.

.... or much of anything, really.


Expecting above-average returns on a small amount of money for several decades as sole income while ignoring inflation and market volatility. What could possibly go wrong?


I hoped to make clear this wasn't the sole income for decades. It's meant as a starting point to dedicate myself full-time on my own projects and hopefully make extra money from this work. Since I'm a developer with focus on mobile, I'd try to make several apps a year in this way which would hopefully generate substantial extra income over time.


Or those pesky 0% interest rates we've had for 7 years.


0% interest rates are not a concept that applies to index funds


Market crashes are though.


  - 100.000 EUR invested in indexfunds should net me on average around 6% a year after taxes, i.e. 6000 EUR a year or 500 EUR a month (7% historic average minus ~1% tax).

  - With no monthly rent to pay, I'm should be able to live a bit more comfortably compared to my Russian co-workers here :)
How are you going to pay the rent when the market inevitably doesn't return?


And what are you going to live on in 20 years time when inflation has halved the value of the 100.000 EURs?


The historic numbers I mentioned with regards to profit from investments take into account historic inflation numbers. The numbers are based on the Dutch book 'De Schitterende Eenvoud van Indexbeleggen'[0].

Inflation should not be an issue.

Still the bigger plan is to make extra money by working full-time on my own projects. So the goal is to increase investments every year and also the profit from investments.

@onion2k: The book isn't saying you can live forever for that amount. It's a calculation I made for myself based on the historic average profits of the stock market in the long term (based on ~100 years of data). I'm living for 2 months in Thailand and I can have a basic living here for 500 EUR a month, especially if I have a fully paid for apartment. That's a basic living without much luxury, but a good starting point to full-time commit myself to my own projects. And hopefully build more income that way. I also don't have wife, kids, etc…

---

[0]: http://www.bol.com/nl/p/de-schitterende-eenvoud-van-indexbel...


I don't read Dutch, but I can assure you that if it's saying you can invest 100.000 EUR and live off the interest forever without reinvesting it then it is wrong.


Well it depends entirely on how much you need to live, how long you're going to live and what kind of dividends you're receiving.


English article about the 7% stock market returns average: http://money.usnews.com/money/personal-finance/mutual-funds/...


Since economics shows that if everyone believes in 7% return , and capital is so efficient to move as it is now with digital systems, that grown would be already priced in. Hence the absurd 50-100x P/E ratios we see. It is unsustainable.


It's only unsustainable if the underlying assets don't allow for 7% return in the long run. It's possible capital is scarce relative to the opportunities for investment such that 7% real returns are the norm. In that case, it doesn't matter if everyone believes in the 7% rate, there will be no crash.


I can live in Germany for that much, and it includes health insurance. Are you sure that's the lowest you can go?


In fact, 670€ is the average that students live on in Germany.


> I also find being rich around 60 years pointless, since you've wasted too much of your life working for "the man" at that point.

Lolwut? Sure it's better to be young and rich but don't discount the comfort of being old(er) and rich.

That said, your plan sounds pretty good. How does your plan change if you want to raise kids?


> That said, your plan sounds pretty good. How does your plan change if you want to raise kids?

If I'd have kids (and wife) I'd need way more money of course. But I don't want kids of my own. This opinion of me hasn't changed in the last 10 years and I don't think it'll change in the future. I believe there are already plenty enough people on earth and more people wouldn't make the world necessarily a better place.


> I believe there are already plenty enough people on earth and more people wouldn't make the world necessarily a better place.

Not contradicting your decision, but I have to argue this point. There are not enough creative, educated, tolerant, empathetic people in the world. Every educated tolerant person with empathy is a little win for civilization. So, if you think you can make or train one, then there's an argument for having or mentoring kids.


Great plan if you have no extended or close family (our you simply don't care about them), nor do you care about living in the country you were born in.


While I don't agree with all the points, the best advice in here is:

"But for all that is good and holy, don’t join a startup for the fucking money."

If you're joining or starting a company because you think you're going to buy a yacht and a small island, stop it! Recently I've seen some Founders tweeting things that make me shake my head every day. You're not going to be rich unless you have that once in a lifetime solution no one else is building. That's why it's called, "winning the startup lottery." It's still a fucking lottery. :)


There are thousands of small, private technology businesses worth millions or tens of millions of dollars across the US, that have taken little to no venture capital, and in which the founders have very large equity stakes in their own business.

It does not require the equivalent to winning the lottery to get rich with a technology business. The odds are several magnitudes greater that you'll get rich creating a technology business than playing the powerball.

Being worth $4 million, and having a small business that generates $650,000 per year in profit, is rich.

Getting rich with a start-up in Silicon Valley, given the approach used there, is like playing the lottery. The start-up lottery you're referring to only exists in SV / SF. Nearly everywhere else, the fundamentals of having an operating business still rule - in that world, a lot of people get rich running smaller technology businesses. $50 million or $500 million rich? Nope, $5 million rich. Silicon Valley is mostly all or nothing, and that's what makes good outcomes so relatively rare.


Exactly what I tell my startup friends. I know people who run design consulting firms and pull in $300-500k/year in profits. Some run SEO/SEM marketing agencies and do similar figures. They give themselves generous salaries and own nearly 80-90% of their businesses which, on paper, are worth $4-5M.

That's definitely very, very well-off, if not F-U rich. And it's very "safe", unless your $1M in revenue hinges entirely on one or two clients


It's safe but it's also exponentially more difficult than starting a startup.

The amount of connections one would need to start a business tomorrow generating $500k in annual profits is insurmountable.

Being a successful consulting agency or freelancer is attainable in two ways:

1. Know a lot of people at a lot of very large companies that are willing to throw you a bunch of work.

2. Build up clientele for a very long time making no money until you hit critical mass.

When I was freelancing it was one of the worst experiences of my life, so of course I'm bias. But I want readers to know that there are 2 sides to every coin.


Exponentially more difficult than starting a startup? No shit, all you have to do to start a startup is say you started one and give a vague semblance of the idea.


In more concrete terms; I'd say it's harder to gross $100k as a freelancer than it is to raise a $6 m+ Series A.


You need a Bootstrap website too.


Thanks for sharing. I've heard numbers like these quoted before with respect to other small or medium sized businesses like franchising a fast-food chain and a question just occurred to me. For the people you know, are the owners' salaries taken before the profits as part of the operating expenses or do the salaries come out of the 300-500k of profits?


You have basically described me minus being in the USA. It is not easy or fast, but it is worth it.


> The odds are several magnitudes greater that you'll get rich creating a technology business than playing the powerball.

This, of course, depends on the individual. Many people are completely inept at running a business and would do much better at powerball.


Also many successful startup were not the one that came up with original idea, they mostly improved on existing products or better marketed themselves.


Here's what I believe: startups are for "fun" money. For "real" money, you'll do far better doing a traditional business where you're guaranteed a return on investment.

I'm talking about consulting, franchises, etc. You won't hit it out of the ballpark and TechCrunch won't feature you, but you sure as hell will have money in the bank.

How you use that money is up to you


What I've realised is that most startups are just traditional businesses, but done with a bit more digital marketing. Selling product, selling services, b2b, etc.

It's only a few startups that are purley technology startups, the majority are actually traditional.


Yes, this is something that makes me scratch my head too. People tend to confuse tech companies with tech-assisted companies.

Microsoft is a tech company; it's business is making and selling technology.

The small eCommerce store that does about $0.5M in revenue using wooCommerce? That's not so much a tech startup as it is a tech-assisted startup. Yet, people continue to confuse the two.


The thinking that you are going to get rich via a startup is a very concrete sign that you are in a bubble. Create a startup because you want to do something that can’t be done in a big company, or because you think it will be fun, but don’t do it for the money.


Developers at failed startups do not as a rule get offered VP-level jobs at Google.


VP level jobs at Google have nothing to do with being a developer and everything to do with playing office politics extremely effectively (and getting lucky, as with much else in life).


I am very wary about claims like those from the article about how working for a lower salary at startups will allow you to somehow compress N years of career experience into (N-k) years of actual work.

I think the instances where that actually happens are balanced out by the instances where your work will be valued at less than what it'd be worth had you worked at Google.


> I am very wary about claims like those from the article about how working for a lower salary at startups will allow you to somehow compress N years of career experience into (N-k) years of actual work.

That claim has never made any sense to me (I think I first saw pg make it). In my experience, there's little to no practical difference between working as a developer at most startups and doing the same at a bigcorp in terms of experience. There's certainly a lot of rah-rah-rah about the "startup culture", but places like Google try very hard to make their employees happy as well.

There might be a little more cowboy coding at the startup and a little more bureaucracy at the bigcorp (though it's a good manager's job to shield engineers from that bureaucracy), but your future job prospects are almost always better when you've got a bigcorp stint on your resume.


One important approach this article is missing is the fact that there are thousands of quiet, successful, single owner companies that have found a niche and don't aspire to change the world, and they still bring in hundreds of thousands of dollars in profit every year.

Getting on with the Google's or the VC backed "change the world" startups aren't the only ways to get rich in tech.


pretty much.


If you have the skills to go work for Google and climb up the career ladder there, you probably have the skills to start your own company, work harder and retire at 40 (not 60) with a decent amount of wealth. Just find an interesting niche, develop it for a large market and don't waste your time on worthless features. I retired at 41 this way and don't think I was even Google material when I started (too old and relatively inexperienced). Also, listen to this advice: https://news.ycombinator.com/item?id=10787615


Just find an interesting niche, develop it for a large market and don't waste your time on worthless features.

"Just"

It requires a good mixture of luck and keeping your ear to the ground to find an undeveloped but large market niche, and a good crystal ball to know which features are worthwhile. I'm not saying it's impossible, but it's far from a certain path to victory.


The more domain expertise you have, the less luck you need to identify a worthwhile niche in that domain.

People tend to think that startups are for young people, but most successful startups are actually founded by 40-something year-olds for this very reason.

https://www.quora.com/What-is-the-average-age-of-founders-fo...


> It requires a good mixture of luck and keeping your ear to the ground to find an undeveloped but large market niche, and a good crystal ball to know which features are worthwhile.

That's a bit exaggerated IMO. Granted, it's harder now than 15 years ago to find something under(not un-)developed on the Web e.g. that seems doable and interesting, but if you keep an open eye, you see opportunities every day and wonder why something that seems useful hasn't been done (or done properly). Some of these potential products will be very hard to develop fully and never be perfect, which doesn't make them less interesting (the opposite is true perhaps - does Google Search work perfectly?), only a bit scarier. As for which features are worthwhile: a lot of wisdom has been written down about this - it's important to look at the product from the perspective of a user. If you lose that perspective, talk to real users.

The rest is hard work and that's easier and more rewarding if you work for yourself, I believe.

My advice is that if you find yourself thinking "XYZ would be nice to have, why hasn't someone done this?" or "all solutions for XYZ I can find are terrible, why hasn't anyone done it right?", just sit down and attempt to do it, if it fits your skill set somehow (doesn't have to be a perfect fit and you don't need an MBA!). People are getting rich like this all the time. Don't look for "unicorn" ideas, you don't need to chase billions to retire comfortably.


The skills to excel in Google are different than the skills to excel building a startup. For starters, it's not about solving a problem creatively but choosing the right problem to solve.


> For starters, it's not about solving a problem creatively but choosing the right problem to solve.

That's just a tiny and in the long run, insignificant part of building a startup. Bad choices fail quickly, you can choose something else.


Don't be so dismissive. That's a huge part of the problem. Your average engineer at Google (or anywhere, really) does not have a good sense of product design / product creation.


If you work hard at Google, you can easily retire at 40.


I completely agree with this. I can't imagine the inflated lifestyle people are living, saying they can't retire until they make $300k+ for 40 years.


Out of curiosity, how old were you when you started? I didn't really begin my career until 28 or so (35 now, undergrad and grad CS degree at a pretty good university) and I've been toying with the idea of moving to something else. Still trying to find an interesting niche that really speaks to me, though I keep my skills current.

I do fairly well for compensation but the way the market has been, I feel like I'm short-changing myself by not taking a shot at a career with the really big players, and I'd love to retire within the next 5-10 years as well. (obviously I've started saving already)


> how old were you when you started?

The project started as a hobby/side project when I was 24-25, it got funded and incorporated when I was 27.


If you worked five years in a startup that failed it's hard to believe that you can get a VPN job at Google. With acquisition maybe. But Google don't hire VPs like that.


Powerful VC who profited from the kind of situation described in the nytimes piece: "Don't join a startup because you are trying to maximize wealth". Fk yes, just like you, the only reason I joined and you invested in that dating app is to save the singles from this damn evil world.


Google and startups are two extreme ends of the spectrum, and neither is that great in terms of risk-reward balance. Personally, I'd recommend joining an established, but still growing, medium-sized company. That means shortly before, or a year or two after IPO, somewhere between 100-500 employees. That kind of a place still has momentum and is still relatively generous with equity. You won't get as rich as your pre-IPO coworkers, but you'll do OK and with less sacrifice. If the company is still growing, there will be opportunities for promotion and for learning and doing a lot of cool things. Think of joining Google or Facebook when they had 500 employees. In hindsight, it seems obvious that that was a good time to join, but I'm sure that lot's of people passed on the opportunity, thinking that it was too late. So recognizing that a company still has momentum can be a bit tricky. If you are coming out of college, one easy way to test if an established company is still a good place or if it has stagnated is to do an internship there.


The real question I think is what are the preconditions to "get rich in tech" and how do you get to those preconditions?

Assuming you're not in a position to get the typical pedigree associated with the preconditions, e.g. Stanford/MIT/ C.S, how does a "typical" engineer become amazing. I would love a comprehensive guide on how to do this.

Being great at your job is one thing, meeting the preconditions associated with getting rich in tech, is another.


"Amazing engineer" doesn't have to correlate with getting rich in tech. I see a couple of paths for getting rich. One, be lucky and work for a start up that becomes a unicorn. Maybe not the best of plans. Two, solve problems for which others will pay for solutions, work hard, and still be lucky (just not as lucky as finding a unicorn - or maybe you accidentally make a unicorn). Three, be an amazing engineer, get a decent salary, save and invest, and wait. For becoming an amazing engineer, focus on providing solutions to the stage of company you enjoy working at. While it might be splitting hairs between being good at your job, I feel an amazing engineer does something more than just their job. They bring something that helos push the company forward. At the beginning, maybe companies need fast implementations that can just get by. Maybe later they need proper automation and tooling. Perhaps they need a solid team lead who works with people as well as tools. Maybe later they need more experience collecting telemety on their systems. Or need more elegant designs to scale. Or whatever. Experience, practice, and/or studying can help you strive to be an amazing engineer. If you find yourself not growing year after year, do something about it. Hope that was cohesive. Posting from a phone throws me off more than I normally am, haha.


Yeah I followed advice like this. It does not always work. I studied hard in college, I worked hard, and I was a programmer earning good money.

I never learned how to deal with stress and the stress from the job caused a mental illness that forced me to go on disability.

If I had to do it all over again I'd develop stress management skills along with people and social skills. Getting along with people who don't understand how technology works is a big deal.

I don't know how to get back into working again and I'm 47 and barely getting by. Blew through my life savings and filed chapter 13 bankruptcy due to high medical bills. If I never developed that mental illness, I'd most likely still be working.


Did you find the job more stressful than college? can you explain what triggered the stress?


Does anyone have an actual example of someone getting to VP level at Google through a startup faster than you could otherwise?


My first piece of advice for startup job seekers is that equity, all things equal, you can’t pick ‘em. On a risk-adjusted basis, startups are likely to be about the same. If there is information that a company has significantly de-risked, it will be priced in. Despite the market often being very wrong, you are unlikely to outsmart it.

I don’t understand the argument for this. Isn’t the whole basis of venture investment being able to identify business that will return above the risk-adjusted return? Given many investors lack the technical understanding to know a good risk from a bad one how could this be priced in?


> Isn’t the whole basis of venture investment being able to identify business that will return above the risk-adjusted return?

No, it's to generate proprietary deal flow by building a brand for your firm. YC has done this with HN and pg's essays, while a16z has done this with Marc Andreessen's incessant tweeting and all the blogging by Chris Dixon, Ben Evans, et al.

At this point, YC's/a16z's success has become self-perpetuating - the best founders/companies will apply to YC and pick a16z over other VCs, the best employees will join companies backed by YC/a16z, etc. It's no different from institutions like McKinsey or Harvard.


Sure, but they still have to pick the above average companies. Even if they don’t pick them and just them picking them means the company has a better chance of success then average then you should be picking companies that YC/a16z will like.


The difficulty isn't in identifying the above average companies, it's in getting them to take your money. Given how little money it takes to get to an MVP these days, most companies backed by the top VC firms already have significant traction, or the founders have a prior success, pedigree, connections, etc.

> you should be picking companies that YC/a16z will like.

Just look up any of the articles on YC's demo days - you've got dumb money coming out of the woodwork from all over the world, trying to get a piece of the action.


Isn’t the whole basis of venture investment being able to identify business that will return above the risk-adjusted return?

Yes, but as a VC you can offset that risk by investing in a range of startups - 9 out of 10 will fail, but the 1 that succeeds will pay for the rest plus a profit. Plus VCs have teams of researchers and analysts to inform them, and they expect the startups themselves to offer some evidence that they can win despite the risk.

You can't really offset the risk in your career because you can only work for one company at a time, and won't have access to the same information about markets and competition as a VC. For you the chance of the startup you choose to work in succeeding is basically the same as any other, although you do get to directly affect it's chances by working hard.


Sure you only get to work at one company at a time, but over a career you are effectively investing in multiple startups and are in the same boat as a good VC. Pick wisely and you are much more likely to retire with money than choosing unwisely.


Over a career, you don't get that many swings at the startup employment piñata; you aren't in anything like the boat a good VC is in if you aren't investing in several in parallel rather than in series.


It can't, hence why it's gambling when you get down to brass tacks.


This would imply the market for startups is perfectly efficient which I find hard to believe based on my experience.


No, but it does mean that at an individual level the difference is not consequential.

a16z and Sequoia might be able to pick the winners at a higher rate than other investors, but that advantage only bears itself out with a large N of companies.

At the individual case, with a single individual looking for a single job in a single company, the difference between being to pick winners 5% better than the baseline is not consequential, since the expected outcome is still "not a winner".

Some people may be able to pick winners better than others - but the effect is not strong enough to be useful in the micro scale because the odds of success are still very, very low.


There is something not right about this argument. Do you really say to yourself: “Here are two companies A & B with the same valuation. I think A has the best chance of success based on its technology, but I don’t care which one I join since they have the same chance of success.”


For the engineer, they may be able to choose wisely between company A and B. But if company A has a 1% chance of getting rich and company B has a 5% chance, it's still only a 5% chance. So any skill in choosing a winner is diminished by the fact that winning is still unlikely.

VC's however, can place many bets and come out winning if they play enough.

Because this is all high variance, a large sample size favors those with skill. Small sample size favors luck.


Because an engineer will work at many startups over his career these seemingly small differences add up. Let assume the chance of not hitting the jackpot is 99% at companies like A and 95% at companies like B. After working at 10 companies you would have a 10% of hitting the jackpot following the company A path and 40% if you go down the company B path. This is pretty significant.


I think a 5% chance of winning is unrealistic for your math, at least without considering payout. Tie the results to the payout and the expected value should show that working at a start up with the idea of making money via equity is foolish compared to Big Co. Let's take that 1% one and say you get $500k if it works out in an IPO. And let's say you take a salary below market of $30k. It will take the start up 7 to 10 years to IPO. You gave up maybe $300k for the chance at $500k. Or the 5% case where the company exits early and everyone gets $100k. Maybe that takes 3 years. You gave up perhaps $90k for a chance at $100k. You can play start up lottery several times in your career, but equity, unless you are getting a very significant portion, should not be a large factor in choosing the start up you work for. Base salary, the environment, culture, learning opportunities, and the ability to make a difference in an organization are reasons to choose a start up. Just not equity. And that's ok :)


Sure, but the odds aren't 10% or 40%, they're more on the order of 1% to 3%. If you can pick winners at a 40% rate, you're doing orders of magnitude better than even the top VCs in the industry, and your talent is worth billions.

Realistically nobody plays at those odds, the actual odds being played are much, much lower.

Which also means that, even through a long career, you're not taking on enough jobs to get a reasonable shot at a win - 10 jobs with a 2% chance of winning each aren't good odds - you have a 18% chance of scoring a win.

All the while you're giving up a lot of money to do so - BigCo's will pay you easily $100-200k more per year. So even if you switch jobs yearly, 10 jobs = 10 years = $1-2M on the table to play for 18% odds.

Which is also why investors who are able to choose well win - YC for example invests in over 200 companies a year. Unless you're switching jobs every week you're not going to be able to raise N high enough to make a difference - at YC's scale a 2% chance of winning for each company means there's a 98% chance at least one company wins.

The entire idea here is that nobody has predictive power high enough to the degree of 10% vs. 40%. Realistically when choosing between two competing startups you're choosing success odds in the low single digits.

Not to mention the rash of articles in the past week about the low payouts you're likely to get even if the company succeeds. Engineers don't walk away from modern startups with 7-figure payouts, low 6-figures is more likely. So realistically even if you are able to pick companies at a 40% accuracy (again, astronomically higher than reality) your expected payout is lower than the $1-2M you're leaving on the table in order to play.


Reading the linked article about how employees of Good paid huge tax bills on stock that ultimately proved worthless - how insane is US tax law?? Surely you should only be taxed on realised gains, i.e when you cash out.


You get taxed at the amount of 'profit' you have gained when you exercise the option. There is an 'ISO' stock option type for employees that makes the tax event when you actually cash out, but an alternative tax system called 'AMT' (alternative minimum tax) kicks in pretty quickly and taxes you anyway. The entire system assumes you are getting public company stock or something similarly liquid and taxes you as so.

Capital losses cannot be applied to normal income in practice in the US either, only to other capital gains.


> Capital losses cannot be applied to normal income in practice in the US either, only to other capital gains.

That's wrong.

You can deduct $3,000 per year in capital losses against normal income.

"Generally, realized capital losses are first offset against realized capital gains. Any excess losses can be deducted against ordinary income up to $3,000 ($1,500 if married filing separately) on line 13 of Form 1040. Losses in excess of this limit can be carried forward to later years to reduce capital gains or ordinary income until the balance of these losses is used up."

https://www.irs.gov/uac/IRS-Reminds-Taxpayers-They-Can-Use-S...


That is why I said in practice. You just had a $50k loss from your startup option tax bill? It's going to take 17 years before you can deduct all of that loss from your normal income!

$150k loss? 50 years!!

In other countries, capital loss can be deducted from your normal income immediately.


> You just had a $50k loss from your startup option tax bill? It's going to take 17 years before you can deduct all of that loss

Unless your next startup options (or Google/Big Co RSUS) have a 50k gain the next year(s). Then it only takes year(s).

Or if you have diversified and have market investments that likewise increase 50k and then you sell them.


AMT is not capital losses. You can apply your AMT credits to their full amount every year until the difference is leveled off.

While the AMT amount may be so high that a lifetime never hits equilibrium, people citing the $3000 capital loss deduction are talking about a completely different thing.


Ok how does this work in Europe. In Amsterdam, high salaeries are around 72000 per year. Of which 50% goes to the tax. So you only have around 3k per month...


Part of the benefit of living in the US is the relatively low tax climate (California notwithstanding, its state income taxes are 4x what I pay) which generally leads to increased socioeconomic mobility (a disputed statement, I know).

I imagine the advice for a European with a salary cap of approximately 70-80k is the same for an American with a salary cap of 85-90k: wealth is most likely only going to come from entrepreneurship or blind luck.


Salaries in the US are much closer to those of in the EU once you factor in the cost of financing your own safety net. That's the counterpart of lower taxes.

Now if you're in the US and pretend to have an EU salary by stashing away a big chunk of it, then yes that is most desirable.


Not in tech. Per other HN recent articles its relatively straightforward to make in the $150-250k range as a software engineer at BigTech. Even if you decide to stash $30k/year after tax for your own 'safety net' (equivalent to whatever net you receive in an EU country), you are still coming out way ahead of a EU software engineer that is probably making $70-90k USD equivalent before taxes take half.


Does anyone make that much money outside of expensive cities like San Francisco and New York though? I know that I am underpaid but I don't think I am that underpaid.


That is where the bulk of tech jobs are, around cities where you can make that much. For example, you can make that in Seattle or basically anywhere in the bay area (no, you don't need to live in SF unless you want to). The cost of living is higher, but the cost of living in large EU cities where tech jobs are going to be is similarly higher.

I think people also make bad comparisons when doing cost of living exercises. While it is true that potentially much more $$ will be going to rent/mortgage in a high cost of living area, many other things are going to be the same as anywhere else. A $100k Tesla is $100k in SF just like its $100k in North Dakota. After tax + basic needs costs and someone in a large tech city is going to have significantly more disposable income still than someone making much lower salary with much lower cost of living.


I'm curious about what you mean by "financing your own safety net"?

If you take an average middle class person in the US, your company will provide you with health insurance, so that's covered. If you come down with a horrible illness and can't work, your employer provides LT disability insurance. If you run out of that, you have Social Security disability insurance. And even if that runs out, you have Medicaid disability insurance.

I won't argue that the EU provides a more comprehensive safety net (probably easier access as well), but US isn't that far behind.


If you live in one of the major metros where the jobs are, your rent may be very high (http://www.theatlantic.com/business/archive/2014/11/why-its-...), which means that your runway that sounds like a lot isn't, /especially/ if you have to deal with an extended job search. This is obviously less of an issue for many decent or better developers in the current market, but this can't necessarily be said of adjacent positions.

Unemployment benefits in the US are both incredibly stingy and time-limited.

Another thing is that there is a strata of people who fall into the donut hole: they make too much to get ACA subsidies, and too little to get a reasonable plan (http://kff.org/health-reform/issue-brief/the-coverage-gap-un...) If you get stuck with a major condition in that situation, you're going to be in a lot of trouble, not to mention that even the insured may not have everything covered. Medical bankruptcies are the most common in the US still: http://www.cnbc.com/id/100840148

"Even outside of bankruptcy, about 56 million adults—more than 20 percent of the population between the ages of 19 and 64—will still struggle with health-care-related bills this year, according to NerdWallet Health.

And if you think only Americans without health insurance face financial troubles, think again. NerdWallet estimates nearly 10 million adults with year-round health-insurance coverage will still accumulate medical bills that they can't pay off this year."

So yes, in the US, you absolutely need your own safety net.


Going to disagree.

Rents may be high in some cities, but compare that to London or Geneva?

Unemployment benefits in the US were extended to 98 week during the last recession. That's two years. Most of the folks I know who went on unemployment insurance had no issues with getting the benefit.

I won't argue with you that the ACA has some stupid income limits. Those don't exist outside of the US?

The medical bankruptcy data that gets thrown around is misleading. It's true that a lot of people that go bankrupt have medical debt, but it's not necessarily the cause of their bankruptcy. That data came from a Harvard study that has been severely criticized.[1]

And health can cause bankruptcy in countries with single payers. There was an article in Canada that health problems are a big cause of bankruptcies in that country as well.[1]

Approximately 15 percent of bankrupt Canadian seniors -- those 55 and older -- cited medical reasons, including uninsured expenses, as the main culprit for their insolvency. In fact, the rate isn't that far off from what you see in the US.

[1]http://thehill.com/blogs/congress-blog/economy-a-budget/2635...


The thing that matters with rents is your income vs. the rising rent. I'm not sure how comparing to London or Geneva means anything. All that matters is "your income vs. rising San Fransisco rents" if that's where you live, and this discussion mainly centered around the US. For job-creating areas, that's a few major metros, by and large.

The 99 week extension ended, and it differs by region anyway:

"Workers in most states are eligible for up to 26 weeks of benefits from the regular state-funded unemployment compensation program, although ten states provide fewer weeks and two provide more. " That's nothing.

http://www.cbpp.org/research/economy/policy-basics-how-many-...

The maximum amount in California is $450 per week, not even enough to pay the median rent for a studio: ($2,722 in August 2015.) Start adding in food and bills, and it's a laugh.

The many sources I've read support the medical bankruptcy stats. I'm aware of the criticisms, but they don't seem to diminish the core case much at all. Other developed countries have medical bankruptcy, but nothing like the US.


The maximum amount in California is $450 per week, not even enough to pay the median rent for a studio: ($2,722 in August 2015.) Start adding in food and bills, and it's a laugh.

Sure, if you pick the most expensive city in the US right now. How does the unemployment insurance in the UK stack up?

We'll just have to agree to disagree. The EU might have a very generous safety net, but it's incorrect to say that the US is that far behind.


The most expensive is a proxy for job creation (see Atlantic article) and social mobility in the current economy: "the San Francisco-San Jose area has a better record of social mobility than just about any region in the country, according to Harvard economist Raj Chetty. In other words, a variety of factors make it the best place for young person to work his or her way into the middle class and beyond."

You can repeat the experiment on other job-creating cities like New York, Boston, or San Jose. Or scale back to "cheap" Oakland (median rent ~2100) and it still looks terrible.

Let's compare just unemployment insurance between the US and Germany. Similar cases can be made for health care, pensions, time off, public/social housing, and even college funding. This doesn't even include things the US doesn't have at all, like Kuzarbeit.

US: maximum 99 weeks during the crisis, now back down to 26 weeks in most places

Germany: "benefit recipients aged 50 to 54 now receive an unemployment benefit for 15 months, those 55 to 57 for 18 months and those 58 or older receive benefits for 24 months. For those under the age of 50 who have not been employed for more than 30 months in a job which paid into the social security scheme, full unemployment benefit can be received for a maximum period of 12 months" then "If a worker is not eligible for the full unemployment benefits or after receiving the full unemployment benefit for the maximum of 12 months, he is able to apply for benefits from the so-called Arbeitslosengeld II (Hartz IV) programme, an open-ended welfare programme which, unlike the US system, ensures people do not fall into penury. A person receiving Hartz IV benefits is paid 399 EUR (2015) a month for living expenses plus the cost of adequate housing (including heating) and health care."

Perform the same comparison between the US and Sweden (with multiple levels of UI, followed by the Job and development guarantee), Austria (unemployment assistance is payable for one year (52 weeks) and may be extended ‘indefinitely’ by application, provided that the qualifying conditions are fulfilled), Denmark (90% of their average earnings for up to four years), or the west/north European country of your choice and you come up with similarly large contrasts. When you start putting those together with their health care, housing, and more general welfare programs, the differences are not small at all.


Socioeconomic mobility in the United States is much lower than in other comparable counties.


Assuming that is the case, could this have anything to do with the US's top income decile being the highest in the OECD 30[0] while the income for the lowest decile in closer to the bottom? Meaning that it's as much a function of just the distance required to move from one quintile to another as it is a measure of any structural mobility or inequality.

[0] 2010, the most recent I could find - http://www.economist.com/blogs/freeexchange/2010/09/income_i...


There are many, many factors, but that's one. Income inequality mapped with social mobility is called "The Great Gatsby Curve."

The usual suspects have the highest social mobility - Denmark, Norway, and Finland plus Canada.

https://en.wikipedia.org/wiki/Socio-economic_mobility_in_the...

Social safety nets actually lead to an increase in social mobility.


Uhh, no. That's because they're homogenous. Homogenous cultures have higher social mobility. Cities like San Francisco and New York for example have lower social mobility than places like Utah or Nebraska.

http://www.newyorker.com/wp-content/uploads/2013/11/cassidy_...


Why would you make a throw-away account for this?


Canada is not a homogenous society.


Canada is homogeneous?

If you actually read the Wiki I linked you'd see that it mentions race/racism and gender/sexism as factors as well.


plus Canada

Which is funny because a lot of Canadians come to the US because it has better career (and salary) opportunities than Canada.


Probably mostly for the already upper class?


I wouldn't say that. I grew up with middle and lower-middle class kids. A lot of them (who were driven) moved to the US since it was the quick way to get into the upper class. Much easier than an Canada.


I think 72K in the Netherlands for a software dev is rare, but maybe it's possible. But the 50% tax is not true, you don't pay 52% over the whole amount, it works with tiers. Over the first 20K you'll pay 36.5%, over the next 38K you'll pay 42% and over the remaining 14K you'll pay 52%.

This equals a net income of 45K, which is 3.75K per month.


That tax structure sounds exactly like the taxes I paid on my salary being a single person in the US.


You will have a generous overall pension (public plus private/collective) and about 850K in additional savings if you save an additional 900/month. I'm being somewhat conservative in my estimates.

The pension alone should be enough to live and even travel on.


Not so sure about getting that pension. Just take a look at the balance sheet of the governments in the EU.


Ironically, some of the richest people I know are actually the poorest.


If your goal in life is to get rich than you have already failed as a human. It is a very easy to get rich. Commit to an amoral lifestyle.


This is the same horsehit they sell graduate students. "Ah, we're paying you a pittance,but the experience is worth it!" But you can't eat experience, and all of this - grad school, the startup ecosystem, etc. - is just a way for greedy assholes to exploit naive young people when they are at their most energetic.

Don't accept sub-market pay and long hours in exchange for 'experience'. Other people (i.e. investors) are making money off your work. Get paid.


The thing about startups is that very often, other people are not making money off your work.

I did a lot better at the two startups that I worked at than the either the founders or investors did. At least I got paid; it may've been below market, but I ended up with net-positive income from them.

Probably the most valuable experience you can get out of a startup is learning that most things fail, and when they fail, they take everybody involved with them, and it's your responsibility to dig yourself out and either make them succeed or find something else that will. Only then can you make informed decisions about your career. A lot of people who join the secure, steady thing never learn this, and then they're completely blindsided when it fails too.


The fact that other people are very often not making money off your work is irrelevant. Rarely, they will make an extremely large amount of money off your work. In expected value, they are making money of your work. (Or else they wouldn't hire you.)


Did you even read the article? People who don't want risk can go to Google and make tons of money. There's nothing wrong with it. This guy is saying if you're working for a startup you shouldn't do it for the money since a much better choice in that case would be to go to Google. I guess no matter how good a piece of advice is, you aren't able to take advantage of it if you're not ready for the advice.


People who don't want risk can go to Google and make tons of money.

Where's this meme that Google just hires everybody who wants to work there coming from? Google has known-broken interviewing processes for hiring capable people (he says, bitterly, after never having had passed a phone screen with them).


"Google" is being used as a stand-in for $tech_megacorp.


Did you read the article? This isn't about assuming risk for the hope of greater reward, this is about working hard and getting nothing in exchange but 'experience'. That advice is bullshit.


>getting nothing in exchange but 'experience'.

Are you assuming there's no pay involved? I didn't get that from the article; it's not saying take a job for no pay. It's saying it's unreasonable to expect to get paid Google money at a startup.

In exchange for not getting paid what you're worth to Google, you get to touch a lot of different areas and get a lot of experience with a lot of things.


Yeah, like another guy said below, who said they get "nothing" but experience? Also you seem to think "experience" is not worth much (maybe because you lack experience of getting experience?), but if you ask me, I would always take a valuable experience over petty money. My time is worth more than a couple thousand dollars per month


Well, thanks for calling me naive.

I chose to work at a startup after working for an established company full of very smart engineers from whom I learned tons about software development and how to operate. I left because after a number of years I felt the need to work on something new and really apply what I had learned, not just about code but building the tech-side of the company. Having a blank slate allowed me to improve in areas I thought could be done better, it showed me the short comings in other approaches. Ultimately it's been an incredible learning experience that you just can't replicate in a lot of ways. I also have entrepreneurial ambitions so joining a startup as employee #1 has allowed me to learn how to build a business at every level. Again, very valuable information that you just won't get from BigCo, MedCo, and probably not even SmallCo. I can't pay to get this knowledge, I simply can't so how do you value this? Luckily for me this is more of a thought exercise as wages in my area are somewhat depressed so a startup can offer a competitive salary.

However I have also seen a handful of graduates who got into software purely as a financial motivation, and dream of winning the startup lottery. They turn down a better job, be it salary, benefits, or a place with great learning potential for a few more options. These are the exploited, the naive.


>> Other people (i.e. investors) are making money off your work

If you are philosophically averse to this, your options seem pretty limited to me.

If you join a startup, it might be investors, as you point out. If you join a big company, it will be that company's shareholders. If you start your own company, it might be your own investors, or if you have none, the government taxing your corporate profits. Also better not start any company doing things like productivity tools, raw materials, etc. Your customers might make money off your work that way...


[flagged]


(We detached this subthread from https://news.ycombinator.com/item?id=10788759 and marked it off-topic.)

This comment breaks the HN guidelines. Personal attacks are not allowed here. Your other comments in the thread aren't civil and substantive either, because they're mostly just venting indignation, and in the signal/noise ratio that we care about, that is noise.

It's worth observing that the indignation was out of place to begin with—the OP not only doesn't advocate what you're railing against, he said the opposite and even put it in bold, presumably to ward off misunderstanding. That mismatch is typical of indignation, which usually pre-exists and is waiting for opportunities to vent. In other words, it's really about something else, which is why such comments always feel off-topic even when they don't appear to be. (This is not a personal critcism; I've made many such comments myself and it took a long time to figure out that doing so is not real conversation.)


Thanks. I find it frustrating sometimes how difficult it is to control tone on the internet, and how discussion is simultaneously impersonal and still affecting. I really appreciate that HN is a space that attempts to maintain a civil tone.


Yes, it's super frustrating, like dealing with an evil genius who knows what all your buttons are and delights in pushing them. That's an illusion, of course, but it's how the statistical aggregate of a whole bunch of people online appears to the human psyche (or at least its hard-wired parts).

HN started as an experiment in trying to withstand that, and though there's much to be unsatisfied with, at least it hasn't succumbed completely.


I think you're acting just the slightest bit rude here, frankly. "Entrepreneurial ambition" != "Silicon Valley/Ponzi scheme/unicorn". Starting a business doesn't mean you have to join the VC/SV/startup treadmill. You can get away with doing the same thing that the vast majority of entrepreneurs have done throughout history: take a skill you know, strike out on your own, and start offering to make things or perform a service in exchange for money. It wasn't until the internet came along that you could become a billionaire in under a decade doing it. That's a distortion that recent history has introduced. The vast majority of entrepreneurs are not SV titans - they're small businesses.

I don't have much respect for folks who denigrate those sorts of ambitions, especially on HN. On top of helping to continue to distort the overall shape of entrepreneurship, it's awfully close to a personal attack, as it's basically saying "Your dreams are stupid".


I feel bad about being rude, but I stand by my position. You are right, entrepreneurial ambition is not the same as the Valley Ponzi scheme, but SV is exactly about funneling that ambition into a wealth-generating machine for the investor class, and most of the ambition in the Valley is captured and squandered this way. I would rather err by calling this out.


I tend to agree with your view of Silicon Valley, but it's not flattering to your intelligence to jump to a conclusion and subsequently get on someone's case due to a false premise.


Or rather, I would like to create a sustainable, long-term profitable business. I don't want to build some Silicon Valley VC bullshit. The knowledge around building a business is generally applicable, and I have always had an entrepreneurial bent, long before I had any idea of VC and long before the way things are now.

Now show me on the organizational chart who hurt you...


Don't bother. Don't even try. It will never happen to you.


What will happen then? Your post is useless without arguments.




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