It seems silly trying to compare yourself to Musk or any other top dog. A lot of people are content just mastering their own little corner, providing for a family, contributing to their communities. That's success, a startup just gives you more control on what corner and what communities you want to be involved in.
Obviously- it's much easier to start a company when you have a safety net to catch you. That does not mean that mean only rich people can start companies, but it does mean it's a lot easier for them.
It's basically a rigged game from the start - Including YC. It's also quite ridiculous to compare yourself to those people. It's symptoms of survivorship bias all over again.
Start with basics. What’s rich? Parents who let you live in the basement rent free? Because that’s a huge leg up yet something most middle class can offer.
Once you don't have to worry about not having to pay rent, not having to pay electricity etc then your appetite for risks grows. To get to that point you either need to start from a rich household (parents) or get to a certain age, have some money to support you (from previous work) and then go into entrepreneurial experiments. This is a big reason why you see older entrepreneurs embarking into that journey.
Your need for success diminishes with wealth though. A lot of founders struggle to motivate themselves to push through the hard stuff, get over the pits of depression, and to drive themselves following mistakes and rejections if they have resources to fall back on. It's a lot easier to take a month off and book a nice vacation after you've been told "no" by an investor or a major customer than it is to keep going and fire up your IDE or pick up the phone to chase another sale.
Many of the founders I've met work crazy hard because they won't be able to pay the rent if they don't. They literally don't have a choice except to succeed. That's a hell of a motivator that wealthy people will never have.
As a poor kid who recently failed to get a startup off the ground, I'll second this. It may have been hard to pay rent, but I knew I could have a 200k base salary whenever I needed to give up. "Getting by" is just not something a reasonably talented engineer in the U.S. ever has to worry about, no matter their background.
> "Getting by" is just not something a reasonably talented engineer in the U.S. ever has to worry about, no matter their background.
Yes it is. Injuries & medical care/accessibility/costs can fuck you harder than you could ever imagine. Even when you may have been previously making mid-deep into 6 figures.
If they'd fail, they'd just have to do something else (less fun) to pay the rent. Perhaps moving to a cheaper housing. That's a negative prospect, but much less negative than getting evicted ('not able to afford rent'). And if you got rich parents, you can always live in a room (YOUR (large) room) in their house. Or have them buy you a house. Its a massive difference from the prospect of having to move to a cheaper, less likable neighborhood but neither is going to kill you.
Depends on your definition of success. One's need of work to pay the bills might decrease with wealth. Yet one's mindset may change to not consider themselves successful until they attain some higher thing (like a big house, fancy cars, expensive vacations, etc).
These founders you're talking about, are they also choosing to live in expensive areas? If they change their definition of success, it's possible they could do different jobs or live in cheaper areas.
No. A smart person can always get a well paying job and still be considered successful by his peers or family.
The son of a wealthy family may think going to Google is the same as failure. He has the money to try over and over again and does so because working for someone else is like being a sheep.
You’re subtly implying that this smart person also has the resume to be allowed to be interviewed in the first place. (A common bias of thought by people working in tech, from my experience).
There are people out there whose problem is not that they aren’t smart, but that they don’t have the resume that is aligned with HR filters. Their two biggest and relatively substantial hurdles are: 1) not getting a chance for even a first interview because they are immediately being rejected purely based on their resume, and 2) having a weak position going into salary negotiations.
So, imho “a smart person can always get a well paying job” is a gross oversimplification often made by people who are not in such circumstances.
Agree with everything you said, but just want to add a couple additional hurdles to even being considered “smart”:
- going to a bad public school because you live in a poor area has ripple effects that may put you in a worse position than some private prep school kid
- if you grew up in poverty, your brain will literally grow differently due to chronic stress, environmental toxins, lack of stimulation, etc. [1].
We pretend like filtering for “smart” is fair, but the opportunity to be smart is heavily weighted by privilege.
Years ago, I saw a study that said that there is as much child neglect and drug abuse in rich neighborhoods as in ghettos. Good parents tend to be middle class because, yes, you need to be able to feed the kids adequately etc but you also need to actually spend time with the kids and care about them.
Cher once said "I've been rich and I've been poor. Rich is better."
Certainly, all other things being equal, it's generally better to have more resources. But life isn't quite that simple and sometimes the price involved in successfully pursuing money involves a human cost.
If you can have lots of money and also have time for the children and also are a decent person, etc, cool. Some people pull that off.
Motivation is nice, but building something new and novel requires skill and being on the edge of the right social/environmental phenomenon (timing).
The skill development part requires free time (to learn and practice) and access (to computers, tools, people, etc.)
If we're talking about creating just any kind of business, then sure hard work and determination are enough. If we're talking about outlier success stories in tech, then privilege is almost always a component of the story.
> Your need for success diminishes with wealth though
I'd consider that a feature, not a bug for the question of global stage level founding: the subset of rich parents offspring who goes after building something aims for building something actually big, not just for the first best thing that promises access to the world of fancy cars and being someone's boss.
There's absolutely nothing wrong with starting a business aimed at bootstrapping itself and funding a car, later a house and in the end maybe even a boat. I have much greater sympathy for those than for people aiming to be the next unicorn (that term hasn't really made the jump into this decade, or has it?). But when it does come to this scope, I'd take it for granted that the born rich run a considerably higher chance of not getting blinded by high numbers and not deluding themselves.
I have a decent backstop and quite frankly I still have a relatively middle of the road risk tolerance. I've done one startup and quite frankly just grinding and doing stuff I like is starting to sound like a much better route as I'm entering my mid to late 20's. For me the bigger force pushing me away from startups was just the amount of stress / energy it takes relative to just working somewhere. To be frank, I think people with decent money and more importantly social energy / connections give you a leg up. Being able to afford living in a place / attend a university that lends itself to these kinds of connections is also incredibly relevant.
The notion of having roommates or not a few years of savings just isn't as cool or interesting as it once sounded. Granted, it feels weird to think about giving up on something I thought I wanted to do for a really long time, but that's just life sometimes.
You also don’t have the time to recover should the startup fail. Because of that I think rich parents holds much more influence than having built up a safety cushion (retirement fund) later in life. The risks are much much higher in that case.
No, it's not an appetite for risk. It's that those risks get less risky.
People become more "risk tolerant" when those risks are less of a threat to them, their survival, their future, etc.
That's a little like saying "Rich people eat at more expensive restaurants than poor people because they have the appetite for it." No, they don't. They have the same appetite as a poor person. They just have more ability to pay for the better restaurant.
It depends what you are measuring as the risk. The risk of lowering your quality of life may decrease with wealth, but the risk of your business failing likely stays roughly the same. Thus, more appetite for risk.
E.g. Poor and rich alike are at risk of losing the capital they put into the business. For the rich that might be daddy's money, while for the poor that might be their life savings. Both are at risk of being unemployed and without healthcare. For the rich that might be fine, but for the poor that could be life-threatening.
Rich parents means you eat better, have access to higher quality resources, have more time for fitness, more time to go to the doctor for preventative issues.
Rich parents means you don’t have to work two jobs or work while studying. Means you have free “consulting” on life decisions from the perspective of the upper class. Means you access to new things like computers, phones, cars, etc.
It’s a huge advantage to come from a successful family. It means you don’t have to spend the majority of your time in survival mode but can instead invest in growth opportunities.
I would say there’s an enormous advantage coming from a rich family but it’s not the only requirement.
I would agree with a lot of this. On the flip side, there's the sayings "Hard times create strong men, strong men create good times, good times create weak men, and weak men create hard times." and "Wealth does not last beyond three generations".
I've anecdotally seen this where kids from rich parents take a lot of their wealth for granted and don't understand fully what it takes to build-up and retain wealth for the long-term. They usually get high-end jobs in society - CFO of company a dad started, doctor, lawyer, etc however it feels some depth to that wealth may have been lost...
Outside of external cataclysm or far bell curve "bad luck" I don't think most born into wealth (defined lets say as the investor class that commands "decent" capital holdings) pass poverty on to their kids.
I've always had a gripe with the "Hard times..." saying, because in reality, hard times just crush people. The few people that survive hard times are of course exceptionally strong or lucky, but they are exceptions.
I can say through my personal experience since I've worked in Switzerland and India: Just because India is having a harder time, doesn't mean we are stronger people, quite the contrary. I don't think good times are anywhere near for India and I don't think hard times are anywhere near for Switzerland.
Agree. The hard times thing is about survivor bias. In reality - hard times create many broken men who never escape the shackles they were born into. I know this because of where I grew up - very few who encountered difficulty ever truly escape or become strong. Most that I know are weak and in a bad cycle. Even the ones who were crowned as the smartest end up working the front counter at a pizza shop. It’s only the ones who had some wealth behind them (anomalies in the town) that were able to truly get out.
There are also a lot of dumb sayings. There is a large amount of scientific evidence demonstrating large and lasting impacts of things like nutrition and parental involvement in education (both early education and ordinary primary education). Hard times might create some hard men. They also just kill a lot of people.
I've anecdotally seen people from impoverished backgrounds struggle to work in a healthy manner for long term success because of trauma dealing with short term needs on a consistent basis.
You talk to a professional if you want to retain wealth for the long term. Would you roll your own auth? Rich -pepper have better access to talented professionals.
There’s obviously a balance between wealth and stress that is useful for happiness/success. But I believe it’s very easy to accidentally traumatize with unbridled stress on a developing person. For example I’m still healing a year from a shoulder overuse injury. Would have been wiser to focus on backing away from the stressors at that point. From what I have seen, rich environments have plenty of bridled stressors, and these rich kids are developing plenty thick skin, just with adequate supervision.
Maybe this generation is different from past ones due to our access to the internet and it’s human refining nature.
Pretty much skewed towards many countries with exorbitant tuition fees though.
I don't think I remember any students here in Germany working 2 jobs. Sure, there's some inherent privilege in getting there to be able to study in the first place, but it has not a lot to do with 'wealth', being middle class and living at home (which kinda used to be the default until you were finished anyway) because we don't have so many campus universities and the majority would study at the closest uni anyway.
But I think I misread your comment as too generic, in the narrow sense of starting a company, yes, but my point is that your 'safety net' doesn't have to be your parents millions in the bank - just keep living at home would be fine.
Not to mention the safety net you always know you can fall back on. I would do everything in my power to avoid asking my parents for help but at the end of the day if I lost my job, couldn't find a new one, and fell on hard times I know I could go to them. I have not lived my life in a way where I might need that (aka taking big risks) but it's in the back of my head and that's a huge peace of mind that many people don't have. In the same vein I could join my parents in their profession (I don't think I'd enjoy it but it's good money and I'd be a shoo-in), that has to affect me on a low level that I don't even realize.
I consider myself to have been fairly successful in my career and while I've worked hard for it, I know at the same time I was born with massive advantages. One of the most depressing things is when I see people who I know have relied on their parents a ton who are completely against any type of social programs. It's frustrating that they can't see that they had "free healthcare" (on parent's plan) till they were 26, that they have UBI in the form of weekly/monthly allowance deep into their adult years, or that they have guaranteed housing when they had to move back in for a few years.
I would say at the very minimum, you need to have middle class parents who don't need your support after you get out of college and hopefully no school debt. It is certainly much much easier to focus all your energy on your product, when you don't need to worry about bills.
Yeah, a lot of things in life are easier if you have safety nets.
Creating a startup is a lot more difficult if you have to pay for your own insurance which is why a lot of new creators that aren't super rich run a sidegig while fully employed before eventually jettisoning from their regular jobs.
Money opens doors, but wealthy living also tends to teach bad habits that limit ambition and grit.
Also, in that thread it was asserted that Steve Jobs did not have rich parents, but they were reasonably well off and lived in a leafy and pleasant neighborhood with excellent schools.
I would describe Steve Jobs as coming from a middle class background, but this was in boom time America, where middle class meant a relatively privileged upbringing.
> The location of the Los Altos home meant that Jobs would be able to attend nearby Homestead High School, which had strong ties to Silicon Valley
> When he was 13 in 1968, Jobs was given a summer job by Bill Hewlett (of Hewlett-Packard) after Jobs cold-called him to ask for parts for an electronics project
Well that's a benefit the vast majority don't get.
Years and years (and years) ago I was considering starting my own business. An entrepreneurship book I read started (quite rightly) with a chapter on "Are you cut out to be an entrepreneur?" It mentioned that having (implicitly successful) entrepreneur parents was a predictor of successful entrepreneurship.
It's a leap from "successful entrepreneur" to "rich", but not a huge leap. In the cited examples, I don't know how the parents made their money, but it's not hard to see how being raised by entrepreneurs could confer advantages beyond a safety net and possible seed investment from parents.
In particular, a child from an entrepreneur household would very likely simply be more comfortable and at ease in that environment and have base level of domain knowledge that others lack. This doesn't mean that nobody else can be successful, of course, they just have more to learn.
I think one thing I want to point out is that acknowledging that being a startup founder is only a path available, practically speaking, to the already privileged is not about just wanting to complain, or about jealousy, or about wanting to freeload on someone else's work, or any of the other things that defenders of modern day capitalism will bring up as strawman defenses of the current system.
What this is about is changing things so that everybody else has the same chance that currently only a tiny minority do. Because as much as our current economic system is much better than anything that came before, it still wastes the vast majority of the talent and potential of its members.
“I am, somehow, less interested in the weight and convolutions of Einstein’s brain than in the near certainty that people of equal talent have lived and died in cotton fields and sweatshops.” -Steven Jay Gould
If you’re looking for an excuse to not start a business, you can’t get better than this. The game is rigged. Thus you would be a fool to try.
Problem solved.
If, however, you kinda like the idea of running your own business, it’s worth knowing that you do not in fact need rich parents or any of the other prerequisites that non-entrepreneurs think are required.
Ask around here and you’ll find plenty of us. (And, of course, if you’re looking, I’m sure you’ll also be able to disqualify all of us individually based on some form of invented privilege).
I think the bigger numbers game is guessing when you'll be both experienced enough and risk tolerant enough to make the leap. At 23 I sure as hell didn't know enough to start a company, led alone code a product end to end. At 27 sure I know a lot more, but the idea of steady income is pretty freaking great - reaching a point where "more money" ever month is sort of a diminishing return. Tbh, I think the people with the most leverage are either just a) really smart, b) started programming when they were 14 or c) have incredible social / networking ability. This is based on my set of friends in college I worked with.
For me, it was having that first $10k in the bank.
That, combined with knowing I could pick up another dev gig quickly if needed, was my safety net, used in lieu of inherited wealth or whatever else.
But you’re right, it takes a few years to get to that point. I was happy ditching work for a year at a time to travel by my late 20s, but I didn’t commit to relying on the product stuff to live on until most of the way through my 30s.
It seems a lot easier to pull off today, in a world with google/Facebook total comp packages for those first few learning years while building up the net.
Agreed, I'm a solidly above average engineer. However, even as interview loops have been easier I still worry that for my age / YOE I'd be leaving valuable money on the table to go and try to start a business that at best would break even.
Thinking about a 2-3 month interview loop is pretty dreadful. At some level I'd need quite a bit of confidence in my idea and more than decent seed funding to leave my job. Basically, being very honest about how good I think I am vs what I could actually deliver.
As I get older, playing the "beg rich people for money game" is getting less and less appealing. Of course, many would describe this as just working or "wage c*cking" but IMO the latter is far more degenerate since by feeling you can only drive value by starting something you inevitably become more of a slave and create worse odds to a) enjoying life or b) being reasonably financially stable
Yeah, I did it by working short contracts to sock away personal runway, then using that to sprint on product stuff for a while. (Which was an easy transition since I was already doing the same thing, just using the downtime to climb rocks in Thailand). I never fully stepped away from “work” to do a startup. I just built SaaS stuff while still keeping one foot in the corporate world.
There’s no rule that says you can’t come back, by the way. I took a 30hr/week contract for five years when my first kid was born to stash away an extra house and college education while the business ran itself in the background. You can keep that brass ring within reach, and even give it the occasional tug if you want.
It looks like plain old cherry picking to me. "Ask around here" ... well, no, this is just about the worst possible place to get a significant or even interesting sample. "Some do succeed" is just anecdata, no substitute for statistical reality.
Secondarily, we have a strawman. "If you’re looking for an excuse" ... you who? Anyone here? Nobody that I'm aware of has said it's not even worth trying. It's entirely possible to be aware of poor odds and still be willing to try. Some who do will even beat the odds, but that doesn't affect the overall reality. It doesn't mean privilege doesn't exist. Whether it exists for GP is irrelevant, but the level of preemptive defensiveness exhibited at the very idea has the counterproductive effect of putting the idea in people's minds.
I read too much Asimov as a kid, though, and the thing that really sets me off every time I read that argument is that it tickles the "psychohistory cannot be applied to the actions of individuals" neurons in my brain.
Happens all the time when I want to talk about the statistical mechanics of a large gas of people and conservatives/republicans/right-wingers always want to argue that any given particle can do whatever it wants and I'm just disincentivizing it.
This is the thing that drives me crazy. The true rags to riches stories are incredibly rare. In the USA we love the stories about the person that came from nothing and the self-made millionaire but in the vast majority of cases if you look at the person's history you will see they grew up in at least an upper middle class family.
This applies to a lot of actors and musicians as well. After all, most of us couldn't afford to be a struggling artist for years without some financial support.
Yes, there are exceptions but those are exactly that: exceptions.
And also because the public likes the idea of themselves moving up the socioeconomic ladder (“temporarily embarassed deca-millionaires”). I think a lot of the political strife in the recent past is due to the increasing inability to ignore how unlikely and how unrealistic this goal is for many.
What's frustrating is that it used to be more common in the US in mid-20th century, after the break up of large companies 100 years ago, but is now regressing back to what's been the norm for almost all human civilization.
For something that is "incredibly rare", I sure seem to know an enormous number of people that managed to bootstrap their way out of real poverty and into real wealth. At least a dozen. It isn't that exceptional, you are overfitting on having heard of them; the vast, vast majority are never going to be written about nor advertise the fact. In many contexts, it is beneficial to pretend like you had an upper-middle class upbringing, so people learn to wear that facade well.
When I see assertions like the above made, it makes me think that it is an assumption made by people that haven't actually spent much time living among the lower economic classes.
Yet I know none and have lived in SV for the last 7 years. Every person I’ve met has come from a middle class family at the least. And an educated one - if not high earning as well. Anyone who has significant wealth is from a privileged background or at the least married into one.
I’m always from the poorest background, least educated, etc. I’ve yet to meet anyone who gets close to where I was. I don’t even feel like I truly was that bad off but then again - I’ve seen how low it goes and most people in SV cannot even comprehend what the bottom looks like in the US.
> Aren't there a lot of immigrants from poorer countries in California?
Poorer countries - maybe. Immigrants who are poor but end up being wealthy? No.
Most people who immigrate to SV are wealthy or at least upper middle class in their home country. (US or otherwise - actually. This is prevalent across all countries - again - I don't meet people who are from poor backgrounds in SV, regardless of country)
I lived in Silicon Valley a long time, and I knew several of these people from when they (and I) were still very poor. They are hiding in plain sight and "pass" as generic upper-middle class people because many have gone to great lengths to project that image and erase the affectations of their background. Obscuring whence they came has significant social advantages. There is still a lot of visible bigotry in Silicon Valley against e.g. an escapee from a trailer park in rural Appalachia that bootstrapped a software career in Silicon Valley without a college degree (real example), even if they are highly successful, and they'd rather avoid dealing with it. Much easier to blend in if you can.
A significant percentage of the ones I knew were not even in tech, which in Silicon Valley means you fly completely under the radar. For example, I know a formerly poor immigrant that made their money in old school book publishing, of all things. The common thread is smart people willing to work hard. There are a lot of them.
How long ago and how much money - because I'm speaking of recently... I think things have changed over the last 10 years and I don't really see anyone who is like what you're talking about. If you're talking about someone who managed to get into a 6-figure job - not really a significant talking point. I'm speaking more of fatFIRE type money - which is common among people here and that is downplayed quite often.
I've really not met anyone under 30 in the last 7 years who fits anything near what you're speaking of. Almost everyone is from an affluent background. About half of my colleagues went to Ivy Leagues or adjacent. It's not very common to see people here who are from poverty and are young. Maybe it's more common among the 50+ crowd where it was more plausible to make your way here with little money (when your average 1000sqft home wasn't $2m+) - but it's basically unseen among the young here.
Again - I'm one of these people you're speaking of. So, it's not really like I don't exist but I've yet to meet someone like myself here. (And, I'll admit - I mostly speak to people in tech who are under 40 and are currently living here)
I'm talking about people that I know are at least in fatFIRE range that started life somewhere between abject poverty and burger flipper. Their income is not relevant here, and some make seven-figures today. I am in Seattle now, but it is essentially the same as Silicon Valley in that regard. Little has changed; I know young people that started on that journey quite recently that are well on their way.
Your "under 30" criterion may be your problem, that selects for a very narrow set of circumstances while excluding most actually wealthy people. Virtually no one becomes wealthy before 30. Especially if you are starting from less than zero, like people that come from true poverty. Anecdotally, they usually enter fatFIRE territory in their 40s. Until very recently, tech did not pay a typical wage where someone could fatFIRE easily. Most of the people I know did it before that was a thing, without any big exits to pad their net worth. They did it the old fashioned way.
Again, I find it pretty bizarre that people in the US think it is exceptionally rare that people born into poverty become quite wealthy. In that community, there are often many examples of people that "got out" by various means, many going on to become quite wealthy. In the tech locales, that is multiplied dramatically because it is so easy for a moderately ambitious person to make silly money. Easiest ticket to wealth for a poor person ever, if they are willing to put in the effort.
Everyone give me some counterpoints to this for inspiration. People that came from abject poverty and made it.
As an aside I do feel strongly that moving up more than one social class is difficult due to not being taught about money and how to handle it. My parents are working class, their parents were poverty level and never taught them anything about money. When I try to teach my parents about money it seems like there is a glass ceiling above their heads, they can’t understand finer details of how to make that final leap to wealthy by agreesively saving and investing and playing taxes correctly. I hope to make that final leap.
I don’t remember most of the millionaires in The Millionaire Next Door coming from wealthy parents, in fact they were mostly working class people that owned a business and were careful with their money. Wealth is actually destroyed after a few generations because subsequent generations never have to learn how to save and not be frivolous.
In my own case you would think my grandparents came from a long line of poverty but this is not the case researching my genealogy. On my Dad’s side they had one of the first two story houses in our part of the state and owned hundreds of acres of land. The progenitor had his grave robbed because people thought he was buried with gold. It had to be covered later by large slabs of rock by the Masons, of which he was a member. But this wealth was lost by gambling and drinking in subsequent generations. The big two story house no longer stands and I don’t know if anyone living even knows where it was.
There is a famous green text someone sent me once and it is about trying to move up two social classes and how hard it is. I try to live like Tyrone.
There's a saying in Mexico: 'rich granddad, millionaire father, miserable son'. Meqning that as families take money for granted, they dont learn what's needed to generate it.
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[ 3.0 ms ] story [ 206 ms ] threadHowever there are other ways of raising your chance of success. I'm working on something to help founders of all backgrounds: https://cxo.industries
Your need for success diminishes with wealth though. A lot of founders struggle to motivate themselves to push through the hard stuff, get over the pits of depression, and to drive themselves following mistakes and rejections if they have resources to fall back on. It's a lot easier to take a month off and book a nice vacation after you've been told "no" by an investor or a major customer than it is to keep going and fire up your IDE or pick up the phone to chase another sale.
Many of the founders I've met work crazy hard because they won't be able to pay the rent if they don't. They literally don't have a choice except to succeed. That's a hell of a motivator that wealthy people will never have.
Most founders I know can easily find a normal 9-5 job if they wanted to.
Other motivators are required.
Yes it is. Injuries & medical care/accessibility/costs can fuck you harder than you could ever imagine. Even when you may have been previously making mid-deep into 6 figures.
Depends on your definition of success. One's need of work to pay the bills might decrease with wealth. Yet one's mindset may change to not consider themselves successful until they attain some higher thing (like a big house, fancy cars, expensive vacations, etc).
These founders you're talking about, are they also choosing to live in expensive areas? If they change their definition of success, it's possible they could do different jobs or live in cheaper areas.
It's all about the definition.
The son of a wealthy family may think going to Google is the same as failure. He has the money to try over and over again and does so because working for someone else is like being a sheep.
There are people out there whose problem is not that they aren’t smart, but that they don’t have the resume that is aligned with HR filters. Their two biggest and relatively substantial hurdles are: 1) not getting a chance for even a first interview because they are immediately being rejected purely based on their resume, and 2) having a weak position going into salary negotiations.
So, imho “a smart person can always get a well paying job” is a gross oversimplification often made by people who are not in such circumstances.
- going to a bad public school because you live in a poor area has ripple effects that may put you in a worse position than some private prep school kid
- if you grew up in poverty, your brain will literally grow differently due to chronic stress, environmental toxins, lack of stimulation, etc. [1].
We pretend like filtering for “smart” is fair, but the opportunity to be smart is heavily weighted by privilege.
1: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4811314/
Money can't buy you love.
I’m not saying growing up rich is always easy, but the point is it’s _more likely_ to be easy than if you’re poor.
Certainly, all other things being equal, it's generally better to have more resources. But life isn't quite that simple and sometimes the price involved in successfully pursuing money involves a human cost.
If you can have lots of money and also have time for the children and also are a decent person, etc, cool. Some people pull that off.
And some people don't.
The skill development part requires free time (to learn and practice) and access (to computers, tools, people, etc.)
If we're talking about creating just any kind of business, then sure hard work and determination are enough. If we're talking about outlier success stories in tech, then privilege is almost always a component of the story.
I'd consider that a feature, not a bug for the question of global stage level founding: the subset of rich parents offspring who goes after building something aims for building something actually big, not just for the first best thing that promises access to the world of fancy cars and being someone's boss.
There's absolutely nothing wrong with starting a business aimed at bootstrapping itself and funding a car, later a house and in the end maybe even a boat. I have much greater sympathy for those than for people aiming to be the next unicorn (that term hasn't really made the jump into this decade, or has it?). But when it does come to this scope, I'd take it for granted that the born rich run a considerably higher chance of not getting blinded by high numbers and not deluding themselves.
The notion of having roommates or not a few years of savings just isn't as cool or interesting as it once sounded. Granted, it feels weird to think about giving up on something I thought I wanted to do for a really long time, but that's just life sometimes.
Now I'm 40, I've got more financial independence but dont really have the drive anymore.
Sigh.
No, it's not an appetite for risk. It's that those risks get less risky.
People become more "risk tolerant" when those risks are less of a threat to them, their survival, their future, etc.
That's a little like saying "Rich people eat at more expensive restaurants than poor people because they have the appetite for it." No, they don't. They have the same appetite as a poor person. They just have more ability to pay for the better restaurant.
Duh.
E.g. Poor and rich alike are at risk of losing the capital they put into the business. For the rich that might be daddy's money, while for the poor that might be their life savings. Both are at risk of being unemployed and without healthcare. For the rich that might be fine, but for the poor that could be life-threatening.
You could say the opposite, and it would be just as true. Risk is an individual choice, not an environmental one.
Rich parents means you don’t have to work two jobs or work while studying. Means you have free “consulting” on life decisions from the perspective of the upper class. Means you access to new things like computers, phones, cars, etc.
It’s a huge advantage to come from a successful family. It means you don’t have to spend the majority of your time in survival mode but can instead invest in growth opportunities.
I would say there’s an enormous advantage coming from a rich family but it’s not the only requirement.
I've anecdotally seen this where kids from rich parents take a lot of their wealth for granted and don't understand fully what it takes to build-up and retain wealth for the long-term. They usually get high-end jobs in society - CFO of company a dad started, doctor, lawyer, etc however it feels some depth to that wealth may have been lost...
Wasn't that debunked?
Outside of external cataclysm or far bell curve "bad luck" I don't think most born into wealth (defined lets say as the investor class that commands "decent" capital holdings) pass poverty on to their kids.
I can say through my personal experience since I've worked in Switzerland and India: Just because India is having a harder time, doesn't mean we are stronger people, quite the contrary. I don't think good times are anywhere near for India and I don't think hard times are anywhere near for Switzerland.
(Switch Switzerland with any developed country.)
I've anecdotally seen people from impoverished backgrounds struggle to work in a healthy manner for long term success because of trauma dealing with short term needs on a consistent basis.
There’s obviously a balance between wealth and stress that is useful for happiness/success. But I believe it’s very easy to accidentally traumatize with unbridled stress on a developing person. For example I’m still healing a year from a shoulder overuse injury. Would have been wiser to focus on backing away from the stressors at that point. From what I have seen, rich environments have plenty of bridled stressors, and these rich kids are developing plenty thick skin, just with adequate supervision.
Maybe this generation is different from past ones due to our access to the internet and it’s human refining nature.
I don't think I remember any students here in Germany working 2 jobs. Sure, there's some inherent privilege in getting there to be able to study in the first place, but it has not a lot to do with 'wealth', being middle class and living at home (which kinda used to be the default until you were finished anyway) because we don't have so many campus universities and the majority would study at the closest uni anyway.
But I think I misread your comment as too generic, in the narrow sense of starting a company, yes, but my point is that your 'safety net' doesn't have to be your parents millions in the bank - just keep living at home would be fine.
I consider myself to have been fairly successful in my career and while I've worked hard for it, I know at the same time I was born with massive advantages. One of the most depressing things is when I see people who I know have relied on their parents a ton who are completely against any type of social programs. It's frustrating that they can't see that they had "free healthcare" (on parent's plan) till they were 26, that they have UBI in the form of weekly/monthly allowance deep into their adult years, or that they have guaranteed housing when they had to move back in for a few years.
"Hustle culture" is what happens when "pulling your bootstraps" is not edgy enough.
Having money:
- gives you more chances to pivot
- more time to find product/market fit
- more time to not need to get a "normal" job just to pay your bills
Creating a startup is a lot more difficult if you have to pay for your own insurance which is why a lot of new creators that aren't super rich run a sidegig while fully employed before eventually jettisoning from their regular jobs.
Also, in that thread it was asserted that Steve Jobs did not have rich parents, but they were reasonably well off and lived in a leafy and pleasant neighborhood with excellent schools.
https://www.theatlantic.com/business/archive/2016/02/the-pla...
> When he was 13 in 1968, Jobs was given a summer job by Bill Hewlett (of Hewlett-Packard) after Jobs cold-called him to ask for parts for an electronics project
Well that's a benefit the vast majority don't get.
And that's also the reason why most successful entrepreneurs rise to new wealth in rich countries. It's just easier to get money where money is.
It's a leap from "successful entrepreneur" to "rich", but not a huge leap. In the cited examples, I don't know how the parents made their money, but it's not hard to see how being raised by entrepreneurs could confer advantages beyond a safety net and possible seed investment from parents.
In particular, a child from an entrepreneur household would very likely simply be more comfortable and at ease in that environment and have base level of domain knowledge that others lack. This doesn't mean that nobody else can be successful, of course, they just have more to learn.
What this is about is changing things so that everybody else has the same chance that currently only a tiny minority do. Because as much as our current economic system is much better than anything that came before, it still wastes the vast majority of the talent and potential of its members.
“I am, somehow, less interested in the weight and convolutions of Einstein’s brain than in the near certainty that people of equal talent have lived and died in cotton fields and sweatshops.” -Steven Jay Gould
I learned about marketing, pitching my projects, but my views on business got much worse.
The result is mostly make believe and "just do it" mindset. We were taught by several coaches, who helped us making us feel good.
But in the end, Bourdieu is just right about everything.
Problem solved.
If, however, you kinda like the idea of running your own business, it’s worth knowing that you do not in fact need rich parents or any of the other prerequisites that non-entrepreneurs think are required.
Ask around here and you’ll find plenty of us. (And, of course, if you’re looking, I’m sure you’ll also be able to disqualify all of us individually based on some form of invented privilege).
That, combined with knowing I could pick up another dev gig quickly if needed, was my safety net, used in lieu of inherited wealth or whatever else.
But you’re right, it takes a few years to get to that point. I was happy ditching work for a year at a time to travel by my late 20s, but I didn’t commit to relying on the product stuff to live on until most of the way through my 30s.
It seems a lot easier to pull off today, in a world with google/Facebook total comp packages for those first few learning years while building up the net.
Thinking about a 2-3 month interview loop is pretty dreadful. At some level I'd need quite a bit of confidence in my idea and more than decent seed funding to leave my job. Basically, being very honest about how good I think I am vs what I could actually deliver.
As I get older, playing the "beg rich people for money game" is getting less and less appealing. Of course, many would describe this as just working or "wage c*cking" but IMO the latter is far more degenerate since by feeling you can only drive value by starting something you inevitably become more of a slave and create worse odds to a) enjoying life or b) being reasonably financially stable
There’s no rule that says you can’t come back, by the way. I took a 30hr/week contract for five years when my first kid was born to stash away an extra house and college education while the business ran itself in the background. You can keep that brass ring within reach, and even give it the occasional tug if you want.
All the best!
The fact that applying it to any one individual is the wrong mentality doesn't mean that at the level of broader society it isn't entirely correct.
Its the difference between sociological statistics and life advice.
It looks like plain old cherry picking to me. "Ask around here" ... well, no, this is just about the worst possible place to get a significant or even interesting sample. "Some do succeed" is just anecdata, no substitute for statistical reality.
Secondarily, we have a strawman. "If you’re looking for an excuse" ... you who? Anyone here? Nobody that I'm aware of has said it's not even worth trying. It's entirely possible to be aware of poor odds and still be willing to try. Some who do will even beat the odds, but that doesn't affect the overall reality. It doesn't mean privilege doesn't exist. Whether it exists for GP is irrelevant, but the level of preemptive defensiveness exhibited at the very idea has the counterproductive effect of putting the idea in people's minds.
Happens all the time when I want to talk about the statistical mechanics of a large gas of people and conservatives/republicans/right-wingers always want to argue that any given particle can do whatever it wants and I'm just disincentivizing it.
When I see assertions like the above made, it makes me think that it is an assumption made by people that haven't actually spent much time living among the lower economic classes.
I’m always from the poorest background, least educated, etc. I’ve yet to meet anyone who gets close to where I was. I don’t even feel like I truly was that bad off but then again - I’ve seen how low it goes and most people in SV cannot even comprehend what the bottom looks like in the US.
Poorer countries - maybe. Immigrants who are poor but end up being wealthy? No.
Most people who immigrate to SV are wealthy or at least upper middle class in their home country. (US or otherwise - actually. This is prevalent across all countries - again - I don't meet people who are from poor backgrounds in SV, regardless of country)
A significant percentage of the ones I knew were not even in tech, which in Silicon Valley means you fly completely under the radar. For example, I know a formerly poor immigrant that made their money in old school book publishing, of all things. The common thread is smart people willing to work hard. There are a lot of them.
I've really not met anyone under 30 in the last 7 years who fits anything near what you're speaking of. Almost everyone is from an affluent background. About half of my colleagues went to Ivy Leagues or adjacent. It's not very common to see people here who are from poverty and are young. Maybe it's more common among the 50+ crowd where it was more plausible to make your way here with little money (when your average 1000sqft home wasn't $2m+) - but it's basically unseen among the young here.
Again - I'm one of these people you're speaking of. So, it's not really like I don't exist but I've yet to meet someone like myself here. (And, I'll admit - I mostly speak to people in tech who are under 40 and are currently living here)
Your "under 30" criterion may be your problem, that selects for a very narrow set of circumstances while excluding most actually wealthy people. Virtually no one becomes wealthy before 30. Especially if you are starting from less than zero, like people that come from true poverty. Anecdotally, they usually enter fatFIRE territory in their 40s. Until very recently, tech did not pay a typical wage where someone could fatFIRE easily. Most of the people I know did it before that was a thing, without any big exits to pad their net worth. They did it the old fashioned way.
Again, I find it pretty bizarre that people in the US think it is exceptionally rare that people born into poverty become quite wealthy. In that community, there are often many examples of people that "got out" by various means, many going on to become quite wealthy. In the tech locales, that is multiplied dramatically because it is so easy for a moderately ambitious person to make silly money. Easiest ticket to wealth for a poor person ever, if they are willing to put in the effort.
As an aside I do feel strongly that moving up more than one social class is difficult due to not being taught about money and how to handle it. My parents are working class, their parents were poverty level and never taught them anything about money. When I try to teach my parents about money it seems like there is a glass ceiling above their heads, they can’t understand finer details of how to make that final leap to wealthy by agreesively saving and investing and playing taxes correctly. I hope to make that final leap.
I don’t remember most of the millionaires in The Millionaire Next Door coming from wealthy parents, in fact they were mostly working class people that owned a business and were careful with their money. Wealth is actually destroyed after a few generations because subsequent generations never have to learn how to save and not be frivolous.
In my own case you would think my grandparents came from a long line of poverty but this is not the case researching my genealogy. On my Dad’s side they had one of the first two story houses in our part of the state and owned hundreds of acres of land. The progenitor had his grave robbed because people thought he was buried with gold. It had to be covered later by large slabs of rock by the Masons, of which he was a member. But this wealth was lost by gambling and drinking in subsequent generations. The big two story house no longer stands and I don’t know if anyone living even knows where it was.
There is a famous green text someone sent me once and it is about trying to move up two social classes and how hard it is. I try to live like Tyrone.
https://www.reddit.com/r/greentext/comments/q05okt/anons_cow...