We keep reducing these complex multivariate social issues to simple cause-effect situations then beating one another up over what the simple cause is.
When we're doing definitions, the key phrase is "necessary and sufficient" In this case, being rich or poor is neither necessary nor sufficient since we have plenty of examples of things working out with either of these two things being missing. So really the discussion is much more like "Does condition X provide a 3 or a 4 percent boost?"
But that's not as fun to argue about.
We oversimplify life and public policy-making at our own peril.
Otherwise there is a very real chances of getting evicted, not being able to find a decent job, not being able to keep your friends or start a family. Plenty of people who are successful today have their parents pay for university, their first apartment and/or a safety net. And that is just to have a normal career.
These days you can also do Kickstarters, apply for money from YCombinator, and other ways.
And you don't have to sacrifice everything. You can try the startup for 3 years and still get an education if it fails.
You can get a perfectly decent degree from your community college for very affordable prices. Likewise you may not be able to live in downtown manhattan, but you can probably live anywhere in a whole bunch of the square states on $1k a month.
Along with that job, we then talk about health insurance. It's great if you are young enough and have parents with insurance that you can be on, but not one of those criteria can be assumed, so if you aren't working a full-time job, you will have limited access to health-care (plus the issues of paying for it if you have access).
Just because some of the high end cost estimates can be undercut doesn't mean there isn't considerable expense and threat.
The fact is, that for many things, a lot of people are perfectly capable of spending a few hours a day on a project above and beyond actually working a full time job. Yeah, people have advantages and others don't. There are risks and rewards. Are you willing to pay them? (you, being the hypothetical startup creator).
In the end, this is how economics works. This is how you make things happen. Nothing is without risk, and anything that is probably isn't worth much to someone that doesn't already have huge means to live without doing it. Creating something is WORK and means not doing something else.
This is the whole point of the discussion here: For many people the risk is dramatically higher or lower than other people. Capitalism suffers if we don't let everyone actually participate in roles other than the menial worker.
Depending on what you are trying to do/build also has varying risk/reward. Want to start a new aircraft manufacturing company? Good luck with that, unless you have multi-billionaire parents. Want to start a new SaaS? you have very little excuse not to start/try.
It doesn't take a lot of risk to try in most cases. All the griping in the world doesn't make someone who won't try succeed. Most excuses are just that. I didn't go to an ivy league school... I grew up poor... meh. The fact is that drive, motivation and effort count for more, more often than anything else given a baseline level of skill, intelligence and aptitude.
Do you also want to normalize professional sports? Let short and fat people play in the NBA?
I don't know if you've failed to follow the point here or are deliberately trying to avoid it. We're not talking about comparing someone "fresh out of secondary school" with someone "in their mid 40's with kids", and we're not trying to compare someone "with drive" to someone just giving excuses.
Fact is, someone with drive and a baseline of money is far, FAR safer when taking risks in capitalism than someone without. I'm not looking for excuses for myself - I'm looking to reap the benefits of a well-functioning market. A market that enables everyone to participate according to their drive, and doesn't expect that they have to sacrifice, health, education, or future ability to be employable to do so.
Today I see a large number of people of above average wealth and opportunities, plus one or two that had plenty of luck while "bootstrapping" themselves all looking down on anyone unable to participate as if they are simply lazy.
We're not trying to get "short and fat" people into the NBA, we're trying to get the people who have to work 60hr/week jobs to somehow have time on the court. "Drive" doesn't begin to cover the problems.
What you are talking about will ALWAYS be part of the risk equation, unless you are talking about normalizing everything across all nations in the world and one global government, with a single base income for all? I'm not sure that I would want to live in such a world given all the side effects of such a government/system.
There will ALWAYS be more risks for some than for others. Someone who has two parents that would let them live at home vs. and orphan with no supportive family. You can NOT have that level of equality without tyranny. And even if you did, you'd have already removed any or at least most of the rewards for any innovation.
Edit: looking at your cartoon, I definitely was raised closer to the, "disadvantaged" woman on the right. That isn't to say that some don't have advantages, but that will always be true, and isn't a net wrong. Even then drive and input are far bigger indicators, and removing the rewards of others won't increase innovation.
An associates from a community college isn't going to get you a meeting with a VC, nor is it going to get you past the resume screen at google to run around the education filter.
This is also able to be circumvented by network, which is very easy to do if you are already at a high end university which will hold your hand grooming you for meetings with VCs they introduced you to, or where you can at least just ask your friend from college for an intro.
No wonder startups are bascially for white guys only.
You are more likely to succeed in your business if you have the experience of building scalable systems, like at google, and if you have a similar friend group to recruit talent from, which is extremely hard at an early startup unless you already know the kinds of people you disproportionately meet at top universities and tech companies, and if you have family/friends that can help you out while you're struggling at the beginning of the startup, etc.
You are less likely to succeed if you have the financial encumberances that are common outside of the upper middle class, or if you have an unstable family structure that leans weight on you, if you don't have a safety net to lean on to get you through rough periods without personal income, and if you don't have the kind of network that a top school, top company, or connected family brings.
I came from a working class background, taught myself how to build products, made my own connections and raised some money for a startup and had to leave and return the money because there was a nonzero chance I'd have to adopt my nephew to keep him from the foster system, and couldn't possibly do that with the hours and volatility of that game. It is perfectly logical to avoid startups that have those kinds of additional risks when the game is already risky.
We absolutely should try to assuage those biases to improve economic mobility, but the answer isn't just to yell at VCs for trying to make money.
You make some valid points, but I really dislike the above comment. When used it seems like a convenient way to diffuse responsibility, often to selfish ends.
There's lots of examples where this type of single-minded attitude isn't acceptable.
- A civil engineer cannot just have making money be the sole pursuit when designing or building a bridge
- A doctor cannot just have making money be the only goal when treating a patient
- A government worker cannot be only concerned on how to maximize their individual gains when awarding contracts
- A financial adviser is expected to act in their client's best interest, rather than their own
We're used to expecting certain levels of ethical behavior from some professions acting within a larger societal framework. I don't know why investing is so often left off the hook in this regard. Maybe it's naive, but I think we'd be better of if people told themselves it WAS their responsibility when making these decisions.
We should be voting for policies that strengthen the nation as a whole. A VC giving up a few % point in return in exchange for betting on poorer people is not going to change anything, other than that VC losing investors. We want to fix families? Well let's guarantee parents have time home with their children, let's guarantee they have sick leave and parental leave and vacation leave to spend with their families. Let's provide more transit and infrastructure and education to communities that need it.
It will require a transfer of wealth.
I would hope, for instance, that Boeing software engineers wouldn't take the stance that their job is to code to requirements and the safety engineers job to make sure the requirements are safe. I would hope everyone has the onus to look at the greater landscape for the impacts of their decisions rather than using a myopic view to skirt responsibility because it's convenient or easy.
Socioeconomic mobility is really much easier to pull on with policy and the education system.
Some people do work on trying to democratize entrepreneurship though, like YC with startup school, or Stripe with Atlas.
They do it by spreading information and reducing barriers, not by giving money to higher risk people though, since that's easier to align with their place in the system.
It's similarly strange to me when I hear people like Jim Cramer advocate investing in tobacco companies even if you find their business practices abhorrent because the point of the investment 'game' is to maximize profit. In his case, his solution was to take those profits and donate to a cancer charity. It just seems like a strange set of psychological hoops to jump through to avoid cognitive dissonance. It comes across that excelling at the 'game' is ultimately what's valued more than the ethics of the business decision. Again, maybe naive or poorly placed, but it seems the most moral choice is to make sure all the decisions align with your values, not creating strange workarounds so you can have your cake and eat it too.
And it is mostly misguided. The barrier to entry and availability of information is what have already changed. It is everything else that hasn't. Or it has, but in the wrong way. By charging a premium for housing, education and contacts instead of taking it out of the equation. Some day all this friction is going to have consequences.
My opinion is their money is tainted from the get-go. It amounts to theft from the very people whom made the things.
Furthermore, you can get VC meetings or a job at Google with no college. Many have done it. It's increasingly the case that employers care more about what you've done/built than what college you went to - or indeed if you went at all.
It's a unique business that rewards socialites and nepotism - right, wrong, indifferent.
If you need to use the bathroom, you're very often better off walking into a lawyer's office than walking into a restaurant, because the restaurant workers have the expectation that a certain percentage of customers are going to shit on the floor, and the lawyer's secretary doesn't, so you don't have to work as hard to combat that expectation.
The same thing happens with community colleges, which have all kind of policies designed to protect the college from the students. Everything down to when you can be there and whether you can talk with a friend in the library is subject to much more negative expectations than in a real university. You can get a lot out of community college in terms of learning, but it's generally more of a struggle.
Starting money is not strictly necessary nor sufficient for success but it sure can smooth over life's pitfalls, which makes risk taking a hell of a lot easier.
Average income is about US$11000 a year: https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28no...
And most people make less money than that, because the distribution isn't symmetric.
The fact that "rent under $1000" seems low to you indicates that you live in a bubble.
I think it's more like whether it brings a 400% boost. It is definitely an important discussion to have. Whether Twitter is the place is another story.
These things get tricky quickly. In a different medium, say forcing yourself to 100 characters instead of 280, we would have even more of a difficult time discussing it.
You are totally missing the point Matthew Prince is trying to make, that is, you need to have a "safety net" before you can take risks. If one can't even get them fed and not worrying about what the next meal is and where to stay, all bets are off.
If you don't agree with me, name one entrepreneur who has found a startup that exited successfully(IPO or Acquisition) by now and that the founder(s) were living below poverty line or on social welfare. Borrowing money from parents doesn't count as living below poverty does it? Having parents or friends or family to lean onto economically means there is a safety net there.
Entrepreneurship seems to strive in harsh do or die conditions like in US or Israel.
Oprah followed the more usual path of "get a job, get promoted, rinse repeat" until she was a household name before she started her own company. Per the article you yourself linked, she was co-anchoring the local evening news at 19. That isn't the same thing as taking a risk on a start-up.
Oprah bootstrapped herself out of poverty to become a media billionaire. You might say she took the long way by routing through various jobs to get the money, but she still came from poverty, founded companies, and became a billionaire.
To take the other side of this (not to entirely disagree with you) people have a different attitude toward risk and betting the ranch given the exact same safety net or lack of it. Someone with rich parents may not take the risk (for fear of 'I told you so' or being derided) and someone poor might be quite the gambler and think 'I really don't care if I fail and if I can't feed my family this is just right and the time is NOW!'
> If you don't agree with me, name one entrepreneur who has found a startup that exited successfully(IPO or Acquisition) by now and that the founder(s) were living below poverty line or on social welfare.
Very possible also that the people giving the funding are not aware of a safety net and therefore think the entrepreneur is less bankable because they actually fear for them failing since they know the chance of failure is quite high. So they pass thinking they are doing them a favor. This (per my above statement) would vary with the amount of a gambler the investor is and/or how much of a conscience they have.
At this point, to encourage health and respectful public discourse, the first step is to delete your twitte account. And probably facebook too.
I get the impression that the only reason Twitter isn't as heavily scrutinized as Facebook is because their executives are simply more likable, which isn't a high bar to pass when you look at Mark Zuckerberg. I think the same applies to Google, too.
I agree that Google is not getting nearly enough attention. I think it because they’re better at PR, and have been developing a “respectable” image. Facebook has been much more blunt and careless in their communication, and now they’re paying the price.
I do hope Google gets in more trouble, they have a lot to answer for. Youtube in particular has a disturbing history of propagating toxic content. Their ad division has been very eager to look the other way when their customers engaged in questionable methods. And they are in great part responsible for demolishing the traditional news business and replacing it with the “engagement” business model that fuels clickbait and outrage-inducing content.
Twitter is cancer and this is why i keep off it.
This doesn’t give those folks much credit. It implies that a few tweets will have a bigger impact on their decision-making than their own detailed understanding of the constraints and anxieties of their own lives.
I don’t think PG is in a good position to understand those constraints and anxieties. And he is somewhat incentivized not to, since YC benefits from having more startups to choose from. But YC does not experience significant downside on the startups that they reject or which fail. Unlike: the founders of those failed startups.
Exactly. And I have been avoiding saying this but keep in mind that from what I remember PG got the idea for YC when he was 'walking through Harvard Yard with Jessica'.
All VC's are like this by the way. Even though they know there is a great chance that many ideas they fund will not work they still push the investments because it's not their mess to cleanup. That said there is actually probably more downside for employees. After all a founder with a big startup failure has been marked as someone 'in the mix' and can usually parlay that to other opportunities. Look at even Sam Altman and what happened after Loopt.
Then he goes on having made his mark to running YC.
If I got it right, Robert Sapolsky claims that the way to make more woman into tech is to make young girls believe that they can do tech. They already have the cognitive capacity.
In this same sense, PG might be hitting the nail in the head: The reason poor people don't do startups is because they believe they can't; and that it is a white privilege.
If they believe they can't, they will not try. If they don't try, the probability that they succeed is exactly %0. Re-enforcing the myth and further convincing poor people not to try.
The only way out is to convince them otherwise and see what the real odds are.
Robert Sapolsky also claims that we need to change our speech and views (ie: remove "negativity") in order to level the playing field. PG is doing the same. He thinks that other ideas need to be censored as it is important to maximalize the propaganda.
That's a dangerous thinking as it touches on freedom of speech. One might wonder if you can level the social "cognitive" field while also preserving freedom of speech. Educating people is the only way I guess.
I think it's dangerous to encourage people to gamble their lives on a low probability outcome if they don't have a strong network of friends and family to fall back on. If you have that, then go for it, but don't pretend that anybody can pull themselves up by their bootstraps and do what you did (I'm using the royal you here). That attitude is what the criticism is aimed at.
Paul seems to be saying you don't have to be rich to do a startup.
Matthew is saying lots of founder have some resources (family home, savings, great education, i.e. middle-class) that made doing a startup feasible
Both these positions are true and aren't incompatible. Being middle class (Matthew's position) and prudent with savings can afford you probably a year of runway.
But I'd never recommend someone who was truly destitute or food insecure to do a startup. If you come from a poor family there will also be family/cultural pressure not to do a startup and instead get a good paying job(assuming you have the ability).
Of course PG is right that you don't need to be a rich kid, but he chose his anecdote poorly.
PS: Also Sam recently said (in the StrictlyVC interview) that most founders at YC are from upper middle class families, so there's your data.
For example 80K won't get a roof over your head in NYC or Silicon Valley, but could support an entire family in middle-America.
And yes, I know, it's not easy to move for everyone to another city or region because of several reasons, but generally speaking most Americans could move to another region where they would get a similar paying job and more value for their buck.
Fuzzy definitions are great when you're posturing politically. In those cases, you want people to be able to apply their own definitions. But political posturing is antithetical to meaningful discussion, so...
I just like PG said "would ordinarily just let your bullshit go". I spit out some water, easily the best thing I've read on twitter this year.
To be honest, I don't think that starting your company with the "risk" that you might move back in with your parents if it fails... is at all a meaningful risk.
Most start-ups (businesses in general) fail. Hard Work® and Dedication® will only get you so far in this country even though that's the garbage fed to many for generations. A great idea is certainly a good start, then ingenuity/creativity/follow-through go a long way, but many times, success comes down to dumb luck, timing and resources. For evidence, look no further than successful companies that push new product/service lines out which fail and are abandoned--it happens quite often.
The American Dream® often boils down to simply rolling the dice. It turns out, you can roll the dice more times if you have more money/wealth when you start to play the game. Everything that isn't the cost of the admission fee can be manufacturing new dice. Heck, with enough money, one can even purchase loaded/weighted dice from your local politicians but I digress.
For many, it's hard to roll the dice when you have to decide if you want food and housing or to play the game. Yes, rewards require risks, that's what our economic system encourages (and I agree with this approach) so one shouldn't be risk averse, but everyone needs to acknowledge that risk is a very relative/proportional quantity that needs to be considered for each case.
Relative risk for Jeff Bezos starting a local business (let's say a simple coffee shop) is not the same as the relative risk for your local barista turned manager wanting to take their years of Hardwork®, Dedication®, and intimate knowledge of the industry to spin up a business. If Bezos cafe fails, he probably didn't even realize it (a drop in the Olympic sized pool) but if your barista fails, they could be on the streets. Bezos can simply hire others with intimate knowledge and operate at a loss for far longer than your local barista can. They need to eat, perhaps their family does. Perpetuating this oversimplified view isn't good for our society and keeps tossing blame on otherwise productive citizens who simply weren't rewarded the same starting hand of cards and opportunities to seize.
Big risk taker, for sure.
How many 18-30 year olds do you see having a swing at it and trying something, vs 30+ people with families and savings to burn?
Providing a link: https://www.kauffman.org/what-we-do/research/2009/04/educati...
The more relevant question would be, what % of 20-30 and 30-40 year olds start businesses?
I'm not surprised most become successful over 30, it takes time to learn.
There is a sense of urgency (e.g. if I don't do it now I won't get another chance) that counteracts the feeling of "nothing to lose")
I've tried searching but cannot find a good empirical study of privilege and entrepreneurship correlation. However, I've found an essay paper  that exactly predicted this twitter drama; that entrepreneurs simultaneously present and erase this conversation about class and entrepreneurship.
The paper also concluded:
> Whereas gender, together with race, have long been foregrounded in studies of entrepreneurial identity and difference, class may be a more powerful organizing discourse, though certainly one supported by discourses of gender and race.
93% had a degree, with 30% having a masters, That would suggest to me that you'd need a decent wedge of cash.
Now, what is interesting, is that in 2016 at least, the US created gross 960k new companies (there is some smoothing here, so +- 100k) The UK created 460k. Seeing as how the UK is 60 million, versus 300 million people, either the US is under performing, or the UK is wildly over performing. (https://www.sba.gov/sites/default/files/advocacy/2018-Small-... and https://researchbriefings.files.parliament.uk/documents/SN06... for stats)
Perhaps, as we don't have to worry about healthcare or no competes, that might be a factor.
Registering a company takes a few minutes and costs less than $30. Compulsory annual filing costs less than $20. If your company's revenue is below some threshold, you don't need to register for VAT (similar to sales tax). And there's another (even higher) threshold below which you can file very simple annual accounts (unaudited, and including neither income statements nor cash flow).
The US would do well to look at its business licensing requirements to see if they could be simplified in terms of paperwork.
The UK also has universal free healthcare for residents, so no need for private insurance when you leave an employer and set-up on your own.
2) A UK limited company is a flexible financial wrapper for all sorts of organisations, many of which aren't businesses in the traditional sense. A significant number of community groups are registered as limited companies rather than charities, even if they are run on an entirely voluntary basis.
3) The extreme convenience of the British system and relatively favourable tax rates mean that a lot of foreign companies choose to incorporate in the UK, even if they have no presence there. Until the introduction of the mini-GmbH in 2008, many German small businesses chose to incorporate in the UK, because dealing with the cross-border issues was easier than dealing with German bureaucracy. If I were a startup founder based in a developing or middle-income country, my first impulse would be to open a UK limited company - it takes about 20 minutes, costs about £20 and gives you a sound basis to operate as an international business.
4) The annual returns for a small limited company are so straightforward that it's often easier to keep a company dormant rather than formally wind it up.
This produces the result that publicly traded company Tesco PLC has a great many sub-companies . This is at odds with a lot of expectations about how companies are counted.
I tried https://beta.companieshouse.gov.uk/company/07530494/filing-h... based on "EBT" in the name (tax shelter scheme), but it's a dormant empty shell.
TESCO GREY (2LP) LIMITED https://beta.companieshouse.gov.uk/company/FC027196 registered in the Cayman Islands? Obvious tax shelter of some sort. Also closed.
One of the common reasons for subdividing firms (in general, not particularly the UK) is to take advantage of liability limitations, which work as well for corporation as shareholder as for natural persons as shareholders. If it is less onerous to set up firms in the UK, you'd expect UK firms to do more of this, because the cost/benefit analysis would favor more of the cost is lower.
For example a company I worked for had a structure where the employees and customers (~250 employees and £50million turnover) were mostly interacting with the named company, but there were three other companies that "onion skinned" the company with the name.
This was done to manage debt, primarily, which then allowed manipulation of taxes.
It will be interesting to see where these numbers move post-brexit.
Lower taxes is irrelevant unless all your operations are in Delaware. It's a great trick for IP holding "companies" that are just a couple lawyers in Wilmington, but otherwise you are paying taxes to whatever states you actually generate revenue in anyway.
There are plenty of universities that are affordable. For instance, City University of New York (CUNY) offers four year undergrad degrees for $6,730 a year . You can get a room share in an outer borough for maybe 500 - 1.5k a month or Jersey for even less .
And this is one of the most expensive cities in the world. If you're smart, avoid unnecessary expenses, you can probably get by on 20k a year in expenses, which comes out to 26 hours a week at $15/hr, ignoring taxes. Taxes at about 15% at that low income means you'll probably want to earn closer to 25k to have 20k net which means 31 hours a week. But realistically you'll probably want to work full time or over time during the months school is not in session and closer to 20 hours a week at other times. Or try to find a job that pays more.
Don't know much about health insurance so that's also something you'll have to consider getting maybe through the school or some city program or just go without it.
Or just move to a more affordable city and probably cut everything above in half while hopefully only giving up a bit of the wage you'll earn
Who needs to work full time to afford €200/year?
For the cheaper universities you can support yourself working 30 hours a week, if you make your degree a 5 year program you can cut your classes down enough that you can live on your income and have enough to pay for class. You don't get any "fun money", but all your time is focused on class so that won't matter. You are also living in the cheapest room you can find, and cooking your own meals of rice and beans (the cheapest food).
Maybe you don't want to live that way, but you could.
Jesus Christ. Please don't take this as a personal attack but it boggles my mind that in 2019 this is a situation accepted as perfectly normal by a large number of people.
In many countries in the west, this is not even a question that arises. I assume you are based in the US?
That someone has to make a choice between potential financial ruin in case of an unforeseen illness or "saving" on insurance and staying solvent to pay for shelter and food in the most powerful country in the world beggars belief.
So what if I fall down some stairs and get multiple complicated fractures? I can just as well call it a day and shutter all my hopes for making it in life because the hospital bill will be punitive.
Sure, it's unlikely to happen, but the discussion here is about the fact that if a person has money (and insurance) then this would be "merely" a painful experience, whereas if they "saved" on insurance and paid for food, shelter and education instead then they are pretty much done for.
It doesn't matter what country you live in, if you are between 15 and 30, and don't have kids: you are extremely unlikely to need a doctor at all. These are the healthiest years of your life.
I'd still want health insurance, but the odds are in your favor if you choose to not have it.
Young people are actually pretty sick which is understandable because time is needed to adapt immune system to external ambient. The lowest period of sickness must be between 30-50 yo (no data, just informed guess).
$560/month to spare would change my life. I already got a good STEM degree on Georgia's HOPE Scholarship (traditional job prospects wiped out by SaaS), so it would go to a good used car, a proper studio computer, and some clothes that aren't years old and falling apart. Plenty of people I know found themselves in debt with degrees no one would hire them for without experience. Not even stereotypically useless degrees. They were pushed into it by everyone they were supposed to be able to trust, sometimes even outright manipulated and lied to by family.
I can’t shake the feeling, though, that after a certain point, in certain (important) circles, “affordable” degrees (like the one I have) are effectively the same as having no degree at all.
Yes! Yes! Yes!
Other things contribute to class, but it remains a class issue.
I'm reminded of this: "If your feminism isn’t intersectional, it isn't feminism.".
We need something similar for those who think the issue is one-dimensional - "the poor".
Because why someone is poor, and what conditions and circumstances result from being poor... poverty (which includes the psychological impact of being poor)... deeply affect the individuals affected, and some of those factors have wider societal causes (racism, homophobia, xenophobia, perceived sex, sexual identity, etc).
Why the disbelief? They are the one who are primed to be the most susceptible to that!
So providing more people with safety nets increases entrepreneurship. Having a strong safety net is a form of privilege.
Does privilege imply that you got it from your "class"? This seems like a classic nature/nurture fallacy.
No, but our privileged parents did contribute to them, and their our upbringing, early months, lack of childhood stress over things as food and war, familial support, good schools, and so on.
Brains is hardly the best contributor to entrepreneurial success. In fact a plot of IQ vs success I've seen plotted looked like random noise except below a certain threshold (obviously seriously cognitive impaired people will have much more trouble becoming entrepreneurs). But aside from that, whether you are 105 or 120 or 150 didn't seem to make much of a difference.
I never claimed IQ was the best measure (surprised it looked like random noise though), but certainly our cognitive traits matter. So to my question: How do you distinguish that privilege from the privilege you got from your "class"?
Edit: Sorry if I came across snarky here, I appreciate your answer!
Well, of people with equal IQs, isn't a potential 0-50% penalty from nurture/privilege still huge enough to make points about "self-made men taking risks" (and implying that others are "lazy" or whatever) moot?
White skin is something you're born with. White privilege is what happens when you live in a society that assumes that black people are more likely to be criminals than white people, so you get a more favourable reception when you walk in a room.
You reiterate my question in the second sentence: How do we weight these different privileges?
>For instance, IQ was believed to be one generic measure of human intelligence, on which Young’s meritocracy was based. But a century of research on IQ and life success has largely dispelled the once widely spread myth about the importance of IQ (Arrow et al., 2000; Gardner, 1983; Goleman, 1995; Gould, 1996; Zhao, 2016). Based on longitudinal studies on IQ and life’s success that lasted multiple decades, researchers conclude that: “the value of the IQ scores should not be overestimated” (Firkowska-Mankiewicz, 2002, p. 41).
Besides that, even if an analytical weighting cannot be given, it doesn't mean we can't examine the effects qualitatively.
>The results demonstrate that intelligence is a powerful predictor of success but, on the whole, not an overwhelmingly better predictor than parental SES or grades. Moderator analyses showed that the relationship between intelligence and success is dependent on the age of the sample but there is little evidence of any historical trend in the relationship.
Perhaps, but the paper also concludes "that the importance of the role of IQ in predicting life success should not be overestimated". Furthermore while IQ did to some degree predict objective life success it does not seem to predict subjective life success, ie how happy you are with how your life turned out.
It’s the best individual predictor when compared against other predictors, but not very predictive on its own.
I.e. Iq is more predictive than inherited wealth, but iq + inherited wealth is more predictive than either individual factor.
Class traits are of course inherited, but there is a distinction to be made between cultural inheritance and generic inheritance.
Which are you talking about?
I don't think PG claimed that poor people are as likely as rich people to become successful founders. That's not the same thing. He says you don't have to be rich to succeed.
All it takes is one person who succeeds who is not defined as rich for his statement to be technically true, even if every other poor founder fails and dies in poverty.
It’s a category error in that his statement is a binary one i.e. true/false, which he is using to defeat arguments which are about continua.
That is a category error.
It’s also a common method of deceptive persuasion - i.e. a dark pattern, but I don’t think PG was doing that on purpose, hence my assumption that it was an error.
And isn't he just providing one example, it seems too much nitpicking to me to then go on claim he made a categorcial assumption based on an example of one?
Maybe the AirBnB founders were comparatively poor. You can always find somebody poorer, and even too poor to do a startup. Like if you have no money, no arms, can't talk, you may be so poor that doing a startup might become difficult. Yeah - OK. Poverty that makes it impossible to do a startup does exist. Doesn't mean that most people couldn't do a startup.
That’s much better than PG, and doesn’t fall into the category error because instead of a yes/no, you are talking about a continuum and you have made a claim about one of the bounds.
Your claim is that at least 50% of people are above the level of poverty required to succeed at a startup.
If true this would be very informative guidance.
So - can you justify your claim with any data at all?
I wonder why that is.
One idea I have: In these countries you don't really need that much more because you're already cushioned against risk. You also don't need to provide a cushion to anyone around you (since everyone's taxes are already doing that). Which means, below you is not the gaping abyss but a shrub that is a little bit thorny.
"I would ordinarily just let your bullshit go, but this myth that you have to be a rich kid to start a startup is terribly dangerous, because it discourages people who aren't from trying it. Brian Chesky's parents were social workers. That is not a rich kid."
As if having two parents with stable jobs isn't considered a safety net. I agree, you don't need to be rich, but I also agree if you are struggling to work enough to eat, you aren't really working on making a startup.
There are huge swaths of people with a much less stable safety net than the example he provided.
Slightly iterating on and pumping old ideas in social media with the goal of conjuring billion dollar valuations for the next ad platform seems to be the norm.
Totally agree about how inane and insufferably out of touch this complaint is. As if today's now-totally-normalized tech company valuations, openly built on nothing more than cash bonfires, aren't dangerous at all.
On the other side, many young people end up having to help their parents make rent. They don't have the position to take on any of their own risk.
Yup. Dreaming about startups was all fun until I realized that I'm essentially providing for 5 people beyond myself, at which point I got super insecure about keeping my well-paying job.
I have been in that position since my early 20s (I'm now approaching my 40s), well, since I was 21 or 22, meaning ever since I got my first salary. I didn't have to pay for my parents' rent but I did have to send my parents money regularly, each month, for almost 20 years now, because it's hard to pay your power bills and to buy basic stuff like bread or edible oil well when you live on subsistence agriculture, like my parents do. Paul Graham's view is very US suburban-centric, like most of the products and cultural views coming out of Silicon Valley.
Living with parents is definitely a safety net. If you have dependants, you can't afford to take risks.
What is the product/service you want to develop? Do you have a defined potential customer (friend/family)?
It's something you can create putting 1-2 hours per day?
What is the minimum amount of work you need to put in to go and show it to someone (even if it is a mockup)
How many customers do you need to break even?
You can do ALL of this and more without quitting your job.
I'm hoping to save enough money to hire a student or novice to get me started... Most of my issues are with complete unfamiliarity with the system... I have 15 years of mostly procedural scripting, not much for game development... But I can quickly pick up code from examples...... Just not many people willing to share source code, especially not in my direction of gameplay (which will be a game closer to solitaire in action mechanics, rather than traditional 2D games).
I've debated some 2D games, I even bought 2 frameworks for 2D games, but everyone recommends using something like Unity for production quality games.
> Why not try to promote a conversation to lift people up and empower them rather than writing off the hard work and perseverance of others?
I think these two can live together - if you succeed, there was something that allowed that. Whether it was privilege, whether it was luck, or timing, or the right application of hard work and a blend of them all.
It's important to recognise what advantages are best leveraged for success, and then we can optimise to ensure most people have access to it.
In the argument in question, what advantage did Airbnb's founders have that allowed them to take that risk? How did they get the flat they were struggling to pay for in the first place for example? Why did they not skip rent and have to work 3 part time retail shifts to cover it like large swathes of workers in a similar boat.
Identifying privilege is an important piece of the puzzle - noone succeeds solely by hard work alone (otherwise all coal miners would be millionaires, and 996ers would be everywhere), so if we can spot the factors that successful people leverage, we can support others to get there (whether that's better education, cheaper housing, familial support etc...).
It's true that a wide variety of things contribute to someone's success, and many of them are outside of their power. Being able to acknowledge this can be taken to the extreme, but all of your statements are entirely valid assessments to make that have real effects on how realistically difficult a task may have been- or if the task was possible at all.
Or, more relevant, if someone is in the dominant social and ethnic group in the richest country in the world and raised in a dual-income white collar family with a degree from an absolutely top-flight internationally recognized college where they met their co-founder, they probably don't fit any reasonable definition of poor.
Many may think their chosen set of contributing factors will make them successful and it turns out, those factors might not be all that useful. By ignoring that information and falsely giving equal weight to all factors, you might empower them down a path far more likely of failure than of success. That path could be a good portion of their lives so I think stepping on a few toes in conversation is well worth trying to resolve those problems instead of only speaking in the positive.
- average pay 35k
- 78% of people live paycheck-to-paycheck (zero savings)
In other countries the situation can be a lot worse. Even excluding the 12% below the poverty line, the vast majority can not afford to leave their jobs even for a couple months without going homeless. Being able to experiment with business that has a 90% chance of failure, even for a short while, is out of reach for most people unless sacrifices much larger than “moving back in with parents” are made.
It should be possible to motivate people to be entrepreneurs without being insensitive to reality. “Rich kids” might be a stretch, but hyperbole is an effective form of communication.
Until your, and your offspring's, survival as a living human revolves around working 16 hour days to barely hold it together... it's almost impossible to understand.
Poor isn't having 2 loving parents with stable jobs, growing up in a middle-class neighborhood and going to college on your parent's dime/credit.
Only a billionaire can begin to think of that situation as "poor". If that person fails then they just go home and live with their parents, that supported them through adolescence, without any major repercussions.
That situation isn't going to happen, except for extraordinary anomolies, for a person that possibly manages to finish high school with siblings in tow, no parents and already holding down 1+ jobs. This is an extreme example, but it presents the issue further.
"Poor" comes in many flavours: monetary, social, responsibilities, safety, time etc...
Once you're poor in any two areas it becomes life threatening to take risks.
No money? No family/friends? Then taking a risk isn't even possible.
No money? Responsibilities (relatives to care for)? Then you have no time.
Responsibilities? No safety net? Now you're not risking your own welfare, but the welfare of those that you care for.
No time? This is a single limiting factor alone. Yes, there are people with very little to no time, where their ability to spend their time is directly proportional to their survival.
There's even rich people that are poor in multiple areas, which disallows them from ethically taking risks. If you're sitting on a cool $100k beyond what _you_ need a year, but you're also supporting an extended immigrant family then it's irresponsible to go throwing money into a high-risk startup. It might not even be the right thing to do for your bloodline, instead opting to provide a stable life so your offspring can take risks.
I got to grow up very poor, and middle-class and now live upper-middle-class. I only made it here because of grandparents that sacrificed to allow my parents to eventually succeed (big time). Even with that safety net, they had almost zero time. I know my father had big dreams, but he had to spend 12 hours a day working/travel to make sure his kids had a chance. Mother had health issues, which complicated things even further.
As an adult I spent many years working with children in poverse circumstances, and _even as children_ they lacked resources to get an education. No time, no access to resources, often with family responsibilities, sometimes abuse, etc... Carry that on to adulthood and now you have to support yourself. Where's ability to dump a few grand into a shot in the dark?
Anyway, tldr; being poor is unfathomable until you're poor.
Anything more than a "fuck off" from PG was charitable.
Talking about rich people and saying "you don't have to be rich to..." is like walking into a room of black people and saying "You don't have to be white to...". Nobody there is going to think that you're talking about asians.
The statement doesn't really say anything except that 'being rich' is something that can come from some other non-rich state. It doesn't specify at what level you can be to reach that state. He could be implying that poverty is sufficient, or "middle-class" or that upper class CT is sufficient (and we don't even know if he thinks that means " rich").
It's just a complete non-statement that attempts to pander to an audience that has little choice but to misinterpret it or assume that he's stating the blindingly obvious.
Life is obviously not an equally constant struggle for everyone.
Social mobility has been declining for years.
For any individual you can create a counterfactual to suggest that their choices are what created their outcome.
However it’s also unarguable that we are not all facing the same risk/reward choices.
And of course people who take on more risk are going to fail more often. And those without a safety net will end up worse off than where they started.
It wouldn’t be risk otherwise.
However some people are proving that they don’t understand the risks other people face, and recommending that they take them anyway.
Advising someone to take a risk that you don’t understand is not leadership.
A startup is both a risk, and an opportunity.
If you incorrectly judge that risk, you have the potential to end up with fewer opportunities than before.
The poorer you are the worse the impact of this will be.
Therefore it is important for anyone, rich or poor, to have a good assessment of the risk of trying to launch a startup.
How are people who aren’t in an environment where people are succeeding supposed to accurately judge the risk of a startup when that information is not in their environment?
They clearly do need accurate information about the risks associated with startups.
It’s clearly true that it is harder for some people than others.
Arguing against this may be ‘encouraging’, but it’s also arguing against accurate risk assessment which is foolhardy in business.
If Paul Graham want to help poor people take risks, using this binary argument is not the way to go about it. He should use some of his resources to produce some realistic risk assessments so that people know what they are taking on.
I'm curious to know what risks involved in creating an startup the average person in the projects would be incapable of seeing on their own.
For what it’s worth I strongly believe that entrepreneurship should be encouraged.
I just don’t believe the way to do it is silence discussion about the factors that make it harder for people who have fewer resources.
So pg arguing that startups aren't for rich kids probably isn't just a claim that you don't need to be rich to start a startup, because that would be a response to a claim no one is making. I think this is why it's reasonable (maybe incorrect, but reasonable) for some people to infer that pg is trying to discredit the underlying notion actually meant by such claims as he referenced, which is that building a successful startup is often less of a meritocracy than we'd like to believe.
Of course we could argue all day about the nuances of each argument, and what was said versus what was meant. But we all know this is the problem with any claim made on Twitter; it invites inference, since abbreviated excerpts don't allow for proper context or dialogue.
I was poor in college like a lot of people, but I had a stable family I could rely on. I knew people who didn't have that, and they had to make very different decisions than I did. I didn't have much money in my bank account, but I was rich compared to many of my peers. No matter how badly things went for me, there was no scenario that would have left me homeless or hungry.
If PG's only point is "you don't literally need a six-figure salary to found a startup" then he's arguing against a strawman.
- The income gap is growing, creating many more levels of wealth, each considerably richer/poorer than the next.
- A lot of wealth is kinda in the background, like the real estate someone's parents might have that isn't discussed, but will probably be inherited someday?
- Products and services cater to the different wealth tiers and create separation and filter bubbles.
This results in very weathy people innocently betraying their ignorance in various public statements, like
PG is saying you don't have to be rich to launch a successful startup. By this, I believe he means private-school, summer-house, frequent-flyer-miles-in-your-early-20s rich. I would contend this is at least 90th-percentile rich for US households.
His critics suggested he be sensitive to those who literally have no safety net, and could not move back in with their parents if it all came crashing down—I would contend this is at most 40th-percentile "rich" for US households.
Can we cut the guy some slack and let him speak to the 50+% of people in the middle? Honestly, that's undoubtedly where the bulk of his target audience resides—people who'd like to launch a startup but worry that they're not sufficiently privileged to do it.
The example given literally attended one of the top private art school in the world. The reason people are reacting is likely because of this often damaging non-differentiation of being temporarily and perpetually poor. Many people can't even afford to move to a city these days, let alone start a startup. And if they do it might have negative consequences for years and years.
Or get pushed further away, as the middle class can't even afford it and they too have to move outwards, and have to commute in.
On the other hand there is the habit nowadays of having to guard and specify ones statements zealously in order not to get called out for something a reasonably lenient reading would allow, but calling something 'bullshit' probably doesn't get you into that other hand category.
This would be more analogous to "you don't need to be a man to be strong", rather than "women are stronger than men".
I think PG's concern is if it's understood "you need to be rich to be a founder", then if you're not rich, you think it won't be possible to be a founder.
Spot on. He could have said "hey, maybe you're right, privileged is a factor, and I was only thinking in terms of wealth." Instead he was defensive.
Public discourse is a great influencer, provided you have the ability to be influenced. If you don't, then you carve a rough path for yourself, whether you're small time or big time.
All it would take is one single example of a poor person being successful while all of the others fail and die in poverty to prove him right.
His example is part of the context, and the fact that his example was not in fact of a poor person demonstrates that he isn’t being responsible for what he says, and deserves the criticism he is receiving.
Yes, I agree. But I also think I acknowledged that, when I wrote I appreciate that Paul G's intended meaning was different.
How about _interpreting_ what he said _literally_...
instead of misinterpreting him as “against social nets”
Again, I think I was quite clear about the distinction between Paul G. (probably) meant, and how I (subjectively) interpret it. My point is not that Paul G is a bad person. I just think he is being somewhat obtuse and insensitive. He is making an argument against a position that nobody is defending, namely that one can't or shouldn't take risk if one is poor. The discussion that sensible people were having before, was about whether one's level of privilege might have something to do with one's willingness to take risk.
The much more interesting remark is the following part:
"...because it discourages people who aren't from trying it"
This is the soil he makes a living from, eventually. Cui bono, essentially.
Details from the podcast -> https://smashnotes.com/p/this-is-your-life-in-silicon-valley...
I have one great-great-grandfather who thought he had an office job in British Columbia, but by the time he sailed from England and crossed the continent the company had folded. But his family was already on their way, so he started working every mining job he could, and invested every spare pence he had into real estate. His sons did the same.
My paternal great-grandfather came over from Italy, got harassed out of NYC by the Irish, bought a small farm in Oklahoma, and his children did the same.
Failing at your startup would at most be equal to losing your job. You won't die just because of that.
Even if you end up in debt, there are insolvency laws. You can just go flipping burgers for a couple of years and be good.
But when you're an Italian who can't speak English or out west in the late 1800s, it was a case of with your shield or on it.
It's not that obvious if it's good for the poor person. I guess that everybody has their own risk aversion threshold.
At zero, you cannot pay rent and are likely to get evicted. Once evicted you are potentially NFA, which means you can’t get a bank card posted to you if you have problems with your card. How can you pay for food? Where can you use the bathroom? What about the electricity bill before you got evicted? The electricity bill that was late and now unpaid that’s ruining your credit score? Now you have bad credit and will find it harder getting a flat.
The above sentences where not chronologically cohesive because there’s so much working against the poor and those at zero, and I’m on mobile, I couldn’t take an hour to type it all out.
How on earth do you expect a poor person to do a startup, when they can barely feed themselves and keep a roof over their head?
Their choices, consequences, and access to information are vastly different.
So why not jump feet first into what you want to do? To quote the eminent Shia LeBouf "It's you're life, don't let your dreams be dreams. Just do it"
When there's little/no social net when you fail, failure is disastrous.
I'm diabetic. I'm nearly chained to a company with a decent medical plan, since our "wonderful" country has little to impetus to fix medicine. So failing means 'not able to go to the doctor and not afford my drugs'.
Failure also means 'not affording rent'.
Failure also means being unemployed, and no way to get unemployment.
So where being a business owner means it could free my way out of poverty, the %success rate for me absolutely must be balanced with the failure rate and the ramifications aforementioned.
Rags to riches (read:Horatio Alger) stories should absolutely not be the basis of social assistance. If you want to see what happens to those that don't win, look no further than the "Smoke N Lotto" store at all whom lose the lottery every day.
Generations are important. A poor person with a family is best not taking risks. However they can bring up enough of a safety net for their children.
That being said, risking some of your resources, money, time, whatever, to get out of poverty is reasonable. Betting on a start-up might not be. Simply because if it goes wrong instead of rewards there might be debt and even worse poverty.
This is a fallacy. The vast majority of people are rewarded for minimizing risk, not taking it. People justify extra risk for disproportionate reward, not reward in general. You have to take risks if you want relatively unbounded returns. Getting out of poverty does not require that at all.
And the poor know this. And yet, they still have literally everything to lose if they fail. They don't want to be poor, but being poor is better than being with absolutely nothing.
A poor person is safest betting on a stable (if low paying) job and ensuring he keeps it. Taking on a few side projects on the weekend can earn some extra cash, but there comes a time you either need to bet on growing that side business, or not: if you bet on it you better have enough contacts to grow it to a real job quickly, if not you have to start refusing work for the side job - the worst thing you could do is to fall asleep and get fired from the day job while the side job isn't paying enough to live on.
Additionally, founders who already come from wealth or have political connections, etc., are probably much more likely to succees in the financial senses that PG wants.
The only limited sense in which it’s good for PG is if there is a lottery winner he can claim credit for, a rags-to-riches story to whip up blind support for some ludicrous tech millionaire idealism.
You could just as lazily & dismissively say nobody cares about failed taxi drivers, and yet there it is on the front page of the most popular Western newspaper in the world.
If there’s an angle to make it a story, people will care. The angle to make it a story about how start-up programs are basically scams exploiting lottery biases of people not in a life position to sustain that risk is very easy, straightforward & compelling to a wide audience.
And hence it’s probably bad for PG & others if people without safety nets are going bust on failed start-ups.