>> What would the ideal be? There’s a renewable energy startup in Providence, Rhode Island, called VCharge that probably could have used Cole too. Its chief science officer, Jessica Millar, has a PhD in math from MIT. VCharge is trying to make our energy grid more efficient using energy storage and transmission algorithms. It’s not a sure thing, but if it succeeds we’ll all be better off for it.
How is a more efficient energy grid the ideal? It sounds very status quo to me.
The ideal would be doubling human life expectancy, building massive Elysium-like space stations that orbit the Earth, a guaranteed minimum income for everyone, and stuff like that. It seems like everyone lacks an imagination nowadays. Where are the people who used to invent things like airplanes and such?
They are mostly the ones getting laughed at and dismissed. Which means there are probably as many or more as there have ever been, but they are not recognized until well after the fact, once it is no longer a risk to laud them.
Transmission and storage are really big barriers to widespread renewable energy. Solar and wind only work in certain geographic areas and times of day, unlike coal/oil plants which can be built anywhere.
Solving those problems is potentially a game changer for carbon emissions, and (if you accept the more dire predictions) the future of humanity.
They work as quantitative trading engineers at giganto investment banks. Or they are underprivileged people who have the potential to do more, but are placated by the soma of social media. Or they're somewhere in the middle, aspiring to develop better soma.
It is a rare combination to find the ability and the ambition (for something other than just economic gain) to make new, exciting things of real value. You have to have all three. Drive, intellectual and economic means, and vision. With the growing gap between rich and poor (or, in other words, the evaporation of the middle class), it's probably not getting better anytime soon, either.
It's hard for educated young people to feel like they can take risks when many of them are shackled by five or six figures of student loan debt. When you know you have a $500-$1000 minimum loan payment ahead of you every month for the next 10-25 years, it's hard to feel like you can fight a dragon when selling a sword is a sure thing.
Older people tend to be more conservative. They tend to have less energy/motivation and more to lose (partner, children, career, friends, house). Younger people are more likely to take risks such as relocating or invest money and time in something that might well fail. This of course doesn't mean that you have to be conservative and unmotivated when you're older, but it's the trajectory the large majority take.
That's describing what is, not what the title claimed is needed. We need people to build inspiring things and take risks. The fact that many older people aren't in positions where's comfortable or easy to do doesn't mean that it's not needed.
One could also make the argument that many 'older' people also tend have have more disposable income and savings to bootstrap their own ideas, have larger networks of people reach out to for connections, etc, and often may have many of their life stuff behind them (kids, house, etc). Therefore there's many older people who are in a better position to be risky than a young person. The 'risk' factor is all relative, of course, with people at different stages of life.
They tend to have less energy/motivation due to greater social commitments and have much less capital to gamble (no savings, no assets, no skills to consult on the side with).
This, of course, doesn't mean most young people have to be conservative when they're younger, just the vast majority will take a safe job to establish a career and set a business up when they're older, vastly more capable, with a much larger set of skills and able to take bigger risks.
The core idea in this article is that it is possible to convince Cole, a 24 year old making mid 6 figures in finance, that he should have instead taken a job making mid 5 figures (maybe) at an energy startup.
I don't see how you can make that happen. His entire trajectory was "making the correct choice" - in which that correct choice was future potential maximizing. Why would he suddenly abandon that track?
In many ways, people in high finance have already "won" in real terms. If he really wants to try his hand at startups, why can't he just jump in as a VC?
I don't think people in high finance have "won". I view winning on a logarithmic scale, and they're somewhere in the middle. At the top would be someone like Augustus Caesar. Below that is Bill Gates, Elon Musk, etc. At the third rung maybe you have multi-millionaires, and below that maybe typical high finance types. So they are at least 4 rungs down.
Except by dint of cash, they can participate in the potential of startups without the risks of actually participating in the startup.
Also, consumption as a portion of income decreases as income increases. Their choice is not $150k/year or "never work again". Their choice is close to $Xmil/year or "never work again". $Xmil is far closer to never work again than $150k.
At some point you stop caring about whether people on the Internet care whether you've "won" and just want a high probability of a good life. Finance will get you there, the engineer position at the typical VC-funded startup won't. Most of these startups won't even introduce you to investors these days! So what is the point if you're not being set up to found later on?
Why "young" people specifically? Seems extremely limiting. There are a lot of talented people out there of every age and we should be encouraging of anyone building the next innovation.
Why "young" people? They don't have families, mortgages, car loans, etc that require consistent income, giving them the freedom to make low-mid 5 figures now, with the possibility of making more later.
Unfortunately, the problem with this is that many young people now are stuck with large amounts of student debt, so they have to take the highest paying job they can find right out of college.
So the theory is in my first paragraph, while the reality is much different, in my second paragraph.
Re: the first paragraph, I think that's often true comparing people in their 20s vs 40s, but many people in their 50s and 60s (especially in engineering) have considerably more financial freedom than those in their 20s. They have somewhat more obligations, but many more resources. With a paid-off house, kids through college, paid-off cars, well-funded 401(k), 30 years of savings from a six-figure engineering job, etc., they have an ability to self-fund that most 25-year-olds don't (and often, a stronger network).
I think there might be more conservatism in that someone who's had a successful 35-year career as an engineer and is used to a regular six-figure income may not be particularly inclined to quit his or her job now and start something else. But I think in terms of resources they're often actually less tied down than a 25-year-old who has no savings cushion and has to pay rent— even if the 25-year-old didn't have student debt.
You have a good point, but I don't think it really stands up. By the time somebody's 50 or 60, they are looking toward retirement, not trying to start the next huge product.
I look at my dad as an example. He's not an engineer, but he makes a 6 figure salary. Once his last kid is out of the house, he'll be 60. Even looking at him now, at 50, I don't think he has the energy to take the risk and start a company. While there may be a few 50-60 year olds with everything needed to start something else, I think the norm goes in the exact opposite direction.
You're treating the effect as the cause. Many young people don't have these obligations because they don't know what they are going to do with their lives and families, mortgages, car loans, etc. are the real risk.
It seems to me that you're implying that young people shouldn't have the right to these things until they contribute to society. I would argue that a real problem we have right now is that people can't figure out how to have families, mortgages, car loans, etc. and contribute to society at the same time. Once we figure that out, then we'll see people taking on more obligations at an earlier age.
They also don't have these obligations because they are young. They haven't had time to start a family or buy a house. It's true that some people may want to go into a startup to avoid the "real risk". However, the "real risk" is the tried and true path, making it easier to fall into. And once a young person does, they have much more to lose by taking a job that may not work out in the long run.
I really don't see where I implied young people don't have the right to these things until they contribute to society. While it's fine if the majority continue on a "normal" path through life (college, job, family + house, 401k, etc), we need some young people who are willing to take the risk of not following that path.
First of all, the VC-funded startup scene is not an antidote. I heard people, in 2008, expressing hope that the financial meltdown (at the time, it was not clear that the financial industry wouldn't contract to 1/20 of its pre-2008 size) would push smart people into Silicon Valley. That wouldn't do much good. The VC-funded world has a corporate ladder that is even more dysfunctional, packing more downside and less upside.
Second, this person ("Cole") is right to take the hedge fund job because it has a far higher chance of making him a founder or VC, in the future, than an engineer position at a startup ever will. When finance people (after a few years) enter the VC-funded tech world, they come in at the top. Seems like a good deal to me.
Silicon Valley doesn't respect its own people. It doesn't respect the people making things. Because of that, it's dead as far as innovation goes, and the death of Silicon Valley has done a lot more damage to society than the mere existence of finance.
> What’s interesting is that many of the people I meet who are young, highly educated, and from good families are among the most risk-averse
I would think that because these people are risk-averse, is why they have the stability that can help form a bedrock for "success". (Disclaimer- I'm biased because I'm risk-averse)
Though the author has good intentions, I fear he has very little understanding of the reality for today's young graduates.
Let's look at a smart young grad's options:
1) Academia - Potentially interesting work. However, grad students are underpaid, overworked indentured servants in a vicious dictatorial status hierarchy (do what the PI says or you're out). Very poor career prospects, guaranteed negative return on time invested. The road to PI is sure to destroy your love of research.
2) Industry - Decent pay but work is extremely mundane. Very few "unicorn" positions which allow freedom for creative roles. No control of hours. Promotion becomes a very serious game of office politics, which can get very nasty.
3) Professions (Law, Med) - Enter at your own risk. Savagely competitive and draconian entrance requirements, incredibly expensive education, inhuman hours, constant stress at every milestone, and a never-ending barrage of standardized tests. However, if you endure, you can start your own practice and potentially have a comfortable life.
4) Entrepreneur - By far the riskiest option. Due to the get rich quick mantra of current investors, social/web/photo apps are the name of the game. Have an idea for a radical new research project with a long term focus? Forget about it. Build and flip is the only game in town. Build an app, get acquired or go go public, make your billions and get out. If it fails, try again, and again, and again....
So, now that we have looked at our options, can we really blame someone for going to work at a hedge fund? I can't. Especially if one is burdened with massive student debt. Ironically, hedge funds and investment banks pay employees much more fairly than any other industry, due to their profit sharing systems (bonuses). Meanwhile, tech industry execs are screaming over how high (!!) engineer salaries are, and are going across the globe to find H1-Bs and changing legislation to push those salaries back down.
If we want everyone to work on world changing projects, we have to set proper incentives. That requires a radically different setup than we have now.
TL;DR: Go to the hedge funds young man. Don't look back. Nothing else makes sense.
> 1) Academia - Potentially interesting work. However, grad students are underpaid, overworked indentured servant in a vicious dictatorial status hierarchy (do what the PI says or you're out). Very poor career prospects, guaranteed negative return on time invested. The road to PI is guaranteed to destroy your love of research.
Potentially interesting work, massive opportunity cost, and starting at the bottom of a ruthlessly competitive advancement pyramid. I love academia, and very much intend to stay in it, but it's not exactly a rational choice.
> 3) Professions (Law, Med) - Enter at your own risk. Savagely competitive and draconian entrance requirements, incredibly expensive education, inhuman hours, constant stress at every milestone, and a never-ending barrage of standardized tests. However, if you endure, you can start your own practice and potentially have a comfortable life.
Bimodal incomes that mean mainly these jobs come with a huge amount of debt for what is, for many people, a comfortable upper middle class lifestyle, but no more than that. You're not going to get rich doing either of these, because your income is capped by the hours you can work. A hedge fund on the other hand, if you're doing your job, is making money all the time.
You're not going to get rich doing either of these, because your income is capped by the hours you can work.
This is true for a while, but if you're smart about it you could expand your business and hire others in the same profession, and eventually become rich.
This of course also varies on your definition of rich - you can certainly manage "rich" in the traditional sense, but not to the scale that you'd talk about for finance.
I can't reply to your comment, but pretty much yes, I'm sure. Doctors and lawyers are actually the canonical example of lucrative but labor limited professions. And being able to build a practice exponentially is vanishingly uncommon, enough so that no one should bank on it, whereas compounding is a fundamental trait of finance.
Are you sure? For example I could imagine see a dentist eventually hiring other dentists, and then more and more, exponentially expanding their business everywhere and growing a brand. It's not easy, obviously, but feasible.
What I've seen happen, at least with doctors, is a bunch of them get together and from a group/partnership and then the group negotiates with hospitals. This has the advantage of increased leverage as a group and thus much better conditions than just an individual working for a hospital, but you aren't getting high-finance rich with that arrangement.
Although I'm not sure whether I'll stay in it, I haven't found CS academia as bad as the stories about Big Science academia. At least, if you look for a job outside the top-20 "R1" schools, which are more focused on big labs and big grants to support those labs. Industry hires away a lot of PhDs, and there are a lot of small to medium-sized CS departments, both of which improve the supply/demand situation and working conditions compared to areas like biology and physics. Things in parts of Europe are even better (which is why I took a professorship in Denmark out of grad school, rather than in the US), but there are a lot of small CS departments in the US where you can work on your research without having an insane life. It does require that you have the kind of research that doesn't need huge funding and huge labs (if you need >$1m/yr budgets, you more or less have to be at an R1 and play that game). And you should at least somewhat like teaching. But if those things are true it can be an ok job with some freedom to decide what to work on. And the odds of getting a tenured position at a smaller school aren't 1000:1 like trying to get to be a tenured prof at MIT.
One of the suggestions I've seen for how happy people are in their field is how readily available the "Eject" button is for leaving your field if things don't work out.
For CS, and some parts of math and physics, it's fairly close. For many other fields, even STEM fields, being able to bail out is a much more distant prospect.
There is one negative to hedge funds: they tend to have long hours. But the stereotype is worse than fact; it's generally 9-to-7 (with some fucked-up sweatshops out there that go longer) and the work is interesting enough (usually) that you don't mind it.
Compared to the (accurately stated) ills of the 4 paths you listed, that negative is pretty mild. And you certainly can find hedge funds with reasonable hours: you're just not as likely to become the $5m/year trader working 9-to-6/7. (But you can go into VC and work 9-to-5 making 500k+.)
I'll probably go back to finance in my mid-30s, because it beats being VP/Eng at some dodgy startup not because I want to manage but because it's the only way to justify age-appropriate comp. The problem I run into now is that, after some startup dalliances (and a 6-monther at Google under a psychotic manager) I ended up with a "job hopper" resume. That doesn't hurt you so much in tech, but hedge funds are terrified of IP loss and auto-reject people with "too many" jobs.
I don't think it's hard to get into a good hedge fund, if you're in the right location (New York, possibly Boston or Chicago).
If you keep building your tech skills, you can get into a good hedge fund job after a few years. Just treat it the same as interviewing for a good tech job. Hedge funds more selective but also more meritocratic and predictable than Valley firms. The problem in the Valley is that, although it has as many smart people, pound for pound, as Wall Street... the Valley has more stupid people (and fewer smart people) in decision-making roles.
Startups aren't inherently damaging. The problem is that they're volatile and experience constant reorgs. Your job might be totally different in 6 months. Or it might not exist. This leads to a "job hopping" pattern that, from a more conservative finance perspective, makes you look bad. Banks and hedge funds are more stable so it's rare that someone is that unlucky as to have, say, 6 jobs in 5 years through no fault of their own. But it happens all the time in VC-funded startups.
I had a colleague in a past job that went from aeronautical engineering to a hedge fund. His career trajectory was MIT masters in aeronautical engineering -> ~5 years in aerospace -> 2 years at a financial software startup (where I worked) that was somewhat desperate for people -> hedge fund. Basically he could demonstrate a solid grasp of math from his past career, managed to find an entry-level position at a financial software startup (taking a pay cut), parlayed that into some knowledge of finance and industry contacts, and then jumped ship once the opportunity arose.
This is good comment, everything is ok but the hedge fund stuff. However, the hedge funds have entrance requirements that are based on perception of institutions.
I think the biggest thing missing from this conversation and thought process is the change in the value of money over time. Basically - it is a lot different to have lower relative purchasing power these days in terms of quality of life tradeoffs. Once upon a time, an "ordinary" job afforded tolerable income, reasonable area, reasonable commute. Think about silicon valley in the days of wozniak. Imagine the live choices made by Jobs, and look where he landed.
Now, you need a top 10-20% income to live in a decent neighborhood within 30 minutes of a major metropolitan era.
Rather than make quasi-totalitarian statements about "what people should do" in the face of otherwise rational choices, perhaps we should instead wonder about what kinds of government policies have been made (fiscal etc) that put pressure on people to feel they "must" make 100k or else.
If people have greater freedom to accept an opportunity, without fear that the change in pay will lead to a material change in living conditions, then this problem may well solve itself.
"Meanwhile, tech industry execs are screaming over how high (!!) engineer salaries are..."
A couple of recent surveys were very eye-opening. Salaries seem high compared to the national average in silicon valley, but if you look at compensation in other fields in in high-cost areas like silicon valley, it doesn't appear that software developers have particularly high salaries.
The first survey is from sfgate (the sf chronicle)...
According to this survey, registered nurses in San Francisco earn $112,140 a year. "Software Developers, Applications" workers earn $110,950 a year. System software developers clock in at $112,260 a year. Lawyers earn an average of $165,740 a year.
Software Developers get the best job title on US News And World Report's rankings
But the top jobs in high paid regions tells a similar story. In San Jose, as with San Francisco, Registered Nurses outearn software developers. In San Francisco, dental hygenists earn $106,700 a year, so about 4k a year less than these wildly well paid software developers.
My point here isn't these aren't important fields worthy of good salaries. I'm really glad that nurses and dental hygienists are well paid, they absolutely deserve good compensation. But why do we talk about software developers as if they are this astoundingly well paid group of workers with runaway salaries? It seems that they make fine salaries compared to other well educated workers. More than some, less than others.
Finance and consulting are the biggest brain drains and it's a huge impediment to society. But until someone starts leveling the playing field compensation-wise, our brightest graduates will continue to flock to finance/consulting.
I was just reading the other day how a kid build a brail writing machine out of Legos. Google it. Afterwards, tons of people are contacting him with opportunities. He smartly found a niche where brail machines were highly expensive and produced a low cost alternative with free plans distributed. On the flip side is he undercutting the makers of the brail machines? Perhaps, but hes helping the "greater good".
So what are the projects and ideas we can tackle? I myself am in a unique position where I have the time to develop such a project. I'm an experienced J2EE developer with Web Design skills. I'd even be willing to work with others on a worthy project.
It's a very idealistic message, but I think it's worth thinking about from time to time. I used to (still sorta do) think that entrepreneurship for people in my age range (20s) was a potential answer. But oftentimes the urge to run a startup outweights the urge to create something of greater value. I'm not saying a lot of startups shouldn't exist, but I find it kind of ridiculous that I know aerospace engineers making shopping apps. A bit of this is fine, if you have some special domain knowledge / experience / insight that can really change this space. Oftentimes though, people just do what's fashionable or safe.
The author complains that the success story does not make for a good story. But this is a person's life, not a novel. That people can take predictable and incremental steps towards leading a good life is a good thing. But maybe that is exactly why we tend to glamorize struggle, risk and unpredictable adventures - because our lives in these relatively streamlined, modern societies are so boring?
Glad this article made the front page. I like the author's message, and while there are a lot of comments here about how US college students graduate with colossal amounts of debt, that isn't true everywhere -- like over here in the UK, where student debt are fairly reasonable and paid back in proportion to your income.
I found the article hauntingly accurate, at least for me: a child of well-off parents, not left wanting for anything and with every possibility open to me, but fundamentally risk-averse because of some misplaced sense of responsibility and duty.
Don't worry about the "real-world consequences [of] fail[ure]" because the author sure doesn't seem to either. For the risk-averse out there, don't you have some family to "fall back on so [you] will be unlikely to starve"?
I think the headline should be: We Need To Lower The Consequences of Failure
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[ 2.8 ms ] story [ 91.5 ms ] threadHow is a more efficient energy grid the ideal? It sounds very status quo to me.
The ideal would be doubling human life expectancy, building massive Elysium-like space stations that orbit the Earth, a guaranteed minimum income for everyone, and stuff like that. It seems like everyone lacks an imagination nowadays. Where are the people who used to invent things like airplanes and such?
Solving those problems is potentially a game changer for carbon emissions, and (if you accept the more dire predictions) the future of humanity.
It is a rare combination to find the ability and the ambition (for something other than just economic gain) to make new, exciting things of real value. You have to have all three. Drive, intellectual and economic means, and vision. With the growing gap between rich and poor (or, in other words, the evaporation of the middle class), it's probably not getting better anytime soon, either.
Drive? Vision? They're far harder to have.
One could also make the argument that many 'older' people also tend have have more disposable income and savings to bootstrap their own ideas, have larger networks of people reach out to for connections, etc, and often may have many of their life stuff behind them (kids, house, etc). Therefore there's many older people who are in a better position to be risky than a young person. The 'risk' factor is all relative, of course, with people at different stages of life.
Benjamin Franklin took risks and made positive contributions throughout his entire life.
They tend to have less energy/motivation due to greater social commitments and have much less capital to gamble (no savings, no assets, no skills to consult on the side with).
This, of course, doesn't mean most young people have to be conservative when they're younger, just the vast majority will take a safe job to establish a career and set a business up when they're older, vastly more capable, with a much larger set of skills and able to take bigger risks.
I don't see how you can make that happen. His entire trajectory was "making the correct choice" - in which that correct choice was future potential maximizing. Why would he suddenly abandon that track?
In many ways, people in high finance have already "won" in real terms. If he really wants to try his hand at startups, why can't he just jump in as a VC?
Also, consumption as a portion of income decreases as income increases. Their choice is not $150k/year or "never work again". Their choice is close to $Xmil/year or "never work again". $Xmil is far closer to never work again than $150k.
Unfortunately, the problem with this is that many young people now are stuck with large amounts of student debt, so they have to take the highest paying job they can find right out of college.
So the theory is in my first paragraph, while the reality is much different, in my second paragraph.
I think there might be more conservatism in that someone who's had a successful 35-year career as an engineer and is used to a regular six-figure income may not be particularly inclined to quit his or her job now and start something else. But I think in terms of resources they're often actually less tied down than a 25-year-old who has no savings cushion and has to pay rent— even if the 25-year-old didn't have student debt.
I look at my dad as an example. He's not an engineer, but he makes a 6 figure salary. Once his last kid is out of the house, he'll be 60. Even looking at him now, at 50, I don't think he has the energy to take the risk and start a company. While there may be a few 50-60 year olds with everything needed to start something else, I think the norm goes in the exact opposite direction.
It seems to me that you're implying that young people shouldn't have the right to these things until they contribute to society. I would argue that a real problem we have right now is that people can't figure out how to have families, mortgages, car loans, etc. and contribute to society at the same time. Once we figure that out, then we'll see people taking on more obligations at an earlier age.
I really don't see where I implied young people don't have the right to these things until they contribute to society. While it's fine if the majority continue on a "normal" path through life (college, job, family + house, 401k, etc), we need some young people who are willing to take the risk of not following that path.
Second, this person ("Cole") is right to take the hedge fund job because it has a far higher chance of making him a founder or VC, in the future, than an engineer position at a startup ever will. When finance people (after a few years) enter the VC-funded tech world, they come in at the top. Seems like a good deal to me.
Silicon Valley doesn't respect its own people. It doesn't respect the people making things. Because of that, it's dead as far as innovation goes, and the death of Silicon Valley has done a lot more damage to society than the mere existence of finance.
I would think that because these people are risk-averse, is why they have the stability that can help form a bedrock for "success". (Disclaimer- I'm biased because I'm risk-averse)
Let's look at a smart young grad's options:
1) Academia - Potentially interesting work. However, grad students are underpaid, overworked indentured servants in a vicious dictatorial status hierarchy (do what the PI says or you're out). Very poor career prospects, guaranteed negative return on time invested. The road to PI is sure to destroy your love of research.
2) Industry - Decent pay but work is extremely mundane. Very few "unicorn" positions which allow freedom for creative roles. No control of hours. Promotion becomes a very serious game of office politics, which can get very nasty.
3) Professions (Law, Med) - Enter at your own risk. Savagely competitive and draconian entrance requirements, incredibly expensive education, inhuman hours, constant stress at every milestone, and a never-ending barrage of standardized tests. However, if you endure, you can start your own practice and potentially have a comfortable life.
4) Entrepreneur - By far the riskiest option. Due to the get rich quick mantra of current investors, social/web/photo apps are the name of the game. Have an idea for a radical new research project with a long term focus? Forget about it. Build and flip is the only game in town. Build an app, get acquired or go go public, make your billions and get out. If it fails, try again, and again, and again....
So, now that we have looked at our options, can we really blame someone for going to work at a hedge fund? I can't. Especially if one is burdened with massive student debt. Ironically, hedge funds and investment banks pay employees much more fairly than any other industry, due to their profit sharing systems (bonuses). Meanwhile, tech industry execs are screaming over how high (!!) engineer salaries are, and are going across the globe to find H1-Bs and changing legislation to push those salaries back down.
If we want everyone to work on world changing projects, we have to set proper incentives. That requires a radically different setup than we have now.
TL;DR: Go to the hedge funds young man. Don't look back. Nothing else makes sense.
> 1) Academia - Potentially interesting work. However, grad students are underpaid, overworked indentured servant in a vicious dictatorial status hierarchy (do what the PI says or you're out). Very poor career prospects, guaranteed negative return on time invested. The road to PI is guaranteed to destroy your love of research.
Potentially interesting work, massive opportunity cost, and starting at the bottom of a ruthlessly competitive advancement pyramid. I love academia, and very much intend to stay in it, but it's not exactly a rational choice.
> 3) Professions (Law, Med) - Enter at your own risk. Savagely competitive and draconian entrance requirements, incredibly expensive education, inhuman hours, constant stress at every milestone, and a never-ending barrage of standardized tests. However, if you endure, you can start your own practice and potentially have a comfortable life.
Bimodal incomes that mean mainly these jobs come with a huge amount of debt for what is, for many people, a comfortable upper middle class lifestyle, but no more than that. You're not going to get rich doing either of these, because your income is capped by the hours you can work. A hedge fund on the other hand, if you're doing your job, is making money all the time.
This is true for a while, but if you're smart about it you could expand your business and hire others in the same profession, and eventually become rich.
I can't reply to your comment, but pretty much yes, I'm sure. Doctors and lawyers are actually the canonical example of lucrative but labor limited professions. And being able to build a practice exponentially is vanishingly uncommon, enough so that no one should bank on it, whereas compounding is a fundamental trait of finance.
For CS, and some parts of math and physics, it's fairly close. For many other fields, even STEM fields, being able to bail out is a much more distant prospect.
There is one negative to hedge funds: they tend to have long hours. But the stereotype is worse than fact; it's generally 9-to-7 (with some fucked-up sweatshops out there that go longer) and the work is interesting enough (usually) that you don't mind it.
Compared to the (accurately stated) ills of the 4 paths you listed, that negative is pretty mild. And you certainly can find hedge funds with reasonable hours: you're just not as likely to become the $5m/year trader working 9-to-6/7. (But you can go into VC and work 9-to-5 making 500k+.)
I'll probably go back to finance in my mid-30s, because it beats being VP/Eng at some dodgy startup not because I want to manage but because it's the only way to justify age-appropriate comp. The problem I run into now is that, after some startup dalliances (and a 6-monther at Google under a psychotic manager) I ended up with a "job hopper" resume. That doesn't hurt you so much in tech, but hedge funds are terrified of IP loss and auto-reject people with "too many" jobs.
If you keep building your tech skills, you can get into a good hedge fund job after a few years. Just treat it the same as interviewing for a good tech job. Hedge funds more selective but also more meritocratic and predictable than Valley firms. The problem in the Valley is that, although it has as many smart people, pound for pound, as Wall Street... the Valley has more stupid people (and fewer smart people) in decision-making roles.
Startups aren't inherently damaging. The problem is that they're volatile and experience constant reorgs. Your job might be totally different in 6 months. Or it might not exist. This leads to a "job hopping" pattern that, from a more conservative finance perspective, makes you look bad. Banks and hedge funds are more stable so it's rare that someone is that unlucky as to have, say, 6 jobs in 5 years through no fault of their own. But it happens all the time in VC-funded startups.
Now, you need a top 10-20% income to live in a decent neighborhood within 30 minutes of a major metropolitan era.
Rather than make quasi-totalitarian statements about "what people should do" in the face of otherwise rational choices, perhaps we should instead wonder about what kinds of government policies have been made (fiscal etc) that put pressure on people to feel they "must" make 100k or else.
If people have greater freedom to accept an opportunity, without fear that the change in pay will lead to a material change in living conditions, then this problem may well solve itself.
A couple of recent surveys were very eye-opening. Salaries seem high compared to the national average in silicon valley, but if you look at compensation in other fields in in high-cost areas like silicon valley, it doesn't appear that software developers have particularly high salaries.
The first survey is from sfgate (the sf chronicle)...
http://blog.sfgate.com/gettowork/2013/12/17/what-the-most-co...
According to this survey, registered nurses in San Francisco earn $112,140 a year. "Software Developers, Applications" workers earn $110,950 a year. System software developers clock in at $112,260 a year. Lawyers earn an average of $165,740 a year.
Software Developers get the best job title on US News And World Report's rankings
http://money.usnews.com/careers/best-jobs/rankings/the-100-b...
But the top jobs in high paid regions tells a similar story. In San Jose, as with San Francisco, Registered Nurses outearn software developers. In San Francisco, dental hygenists earn $106,700 a year, so about 4k a year less than these wildly well paid software developers.
http://money.usnews.com/careers/best-jobs/dental-hygienist/s...
My point here isn't these aren't important fields worthy of good salaries. I'm really glad that nurses and dental hygienists are well paid, they absolutely deserve good compensation. But why do we talk about software developers as if they are this astoundingly well paid group of workers with runaway salaries? It seems that they make fine salaries compared to other well educated workers. More than some, less than others.
So what are the projects and ideas we can tackle? I myself am in a unique position where I have the time to develop such a project. I'm an experienced J2EE developer with Web Design skills. I'd even be willing to work with others on a worthy project.
http://www.reddit.com/r/realproblemsolvers
I found the article hauntingly accurate, at least for me: a child of well-off parents, not left wanting for anything and with every possibility open to me, but fundamentally risk-averse because of some misplaced sense of responsibility and duty.
I think the headline should be: We Need To Lower The Consequences of Failure