5 ms·

Like fear, you should take Survivorship bias into account, but it should not dominate you. If you do you will do nothing in life. When I created my first compa

Like fear, you should take Survivorship bias into account, but it should not dominate you. If you do you will do nothing in life. When I created my first company my parents told me about how hard it was going to be, how few succeed... On the contrary I found it was way easier and natural than studying engineering was, for example, and hundreds or thousands of people could do it. I found most serious people succeed in business. It is not that hard to become a millionaire, way easier than being a salaried person, tens of thousands of times easier than winning a lottery. On the lottery you have absolutely no control about the outcome, on real life you can "cheat" and control anything. For example, one of the great discoveries in my life is that in business if you don't know how to do something you can just hire the person to teach you or your team or just do it for you. That felt like cheating because I had been trained all my years on school and job that you have to do all your job yourself, regardless you being good at it or not. That control makes it extremely easy to do things. For example you could work with the people you want to work with, that makes your life way easier and enjoyable than if you are externally forced to work with people you don't want to work with. In the startup world some people want to be billionaires, and that is probably akin to winning the lottery. But I know some billionaires and do not envy them. Traveling everywhere with armed escort because someone could kidnap your children, so you live in a bunker isolated from everyone. Everywhere you go someone wants something from you, a loan , to invest in them. Banks harassing you all the time. Not knowing if people is around you just for your money.

BoiledCabbage 9y ago
> I found most serious people succeed in business. It is not that hard to become a millionaire, way easier than being a salaried person This is the trouble with discussions on this topic. Everytome Survivorship bias comes up, someone provides "counter evidence" which happens to be a picture perfect example of survivorship bias. Most serious people don't succeed in business. It is hard to become a millionaire. Way more people with the exact traits you'd describe as being what's needed for success have failed than succeeded.
- thenomad 9y ago
  Way more people with the exact traits you'd describe as being what's needed for success have failed than succeeded. Do you have proof of that assertion? I'd tend to largely agree with the OP, although I think he's overstating the point a bit. It's certainly not a great deal harder to get to the millionaire point as an entrepreneur than as a conventional salaried worker - assuming you have the appropriate character traits. If you're a self-starter with a fair amount of willpower and the ability to effectively learn, lifestyle businesses (as distinct from unicorns) are not massively tricky to grow. They're not easy, and there's definitely a learning curve, but it's on the "doable" end of the scale. (Background: I've built a few, and I teach other people to build them.) Addendum: we should probably also start by defining "failed" here. If you mean "way more people's first businesses fail than succeed", I'd agree with you, absolutely. If you mean "way more people have started more than 8 businesses following best practice and have had zero successes than have had any success", I'm much more skeptical. It's an axiom - even in the talks by famous successful people mentioned in the comic - that you generally need a few attempts to get the hang of launching and running anything.
  - aaron-lebo 9y ago
    Just take a look at the average YC batch. If anyone is set up to succeed, it is those guys with coaching, resources, and connections. Most of them don't become wildly successful and are only successful in any sense because of the ability to pivot, learn lessons, etc. (see Schwartz's Infogami -> Reddit transition). Or check out small business failure rates. More anecdotally and less scientifically, watch retail/food locations which have business after business after business open in them. A successful lifestyle business takes a lot of learned knowledge, and by virtue of building a single one you've had more success than most. Just beating the odds on one was your survival, once you did that you had a lot of advantages. Bigger serial entrepreneurs often have similar patterns. One success allow you to make another which allows you to make another, all with varying degrees of success and with failure effectively subsidized. See Mark Cuban, Ev Williams, Pewter Thiel.
    - thenomad 9y ago
arximboldi 9y ago
> It is not that hard to become a millionaire, way easier than being a salaried person Sure. If it is not so hard, everyone would do it. If everyone was a millionaire, who would do actual unpleasant work? Who would clean, run hospitals, build infrastructure? Who would work for your startup so you can make money? Your comment is such an example of survivorship bias! Capitalism is a competition. You won, good for you. Don't tell the rest they can win too, that's insulting. You won because someone lost.
- thenomad 9y ago
  The "actual unpleasant work" is to a significant extent the domain of entrepreneurs. For example, cleaning companies - often started by one person doing the cleaning - are an absolutely textbook example of entrepreneurship. Some of those entrepreneurs then become millionaires :) (Updating this post: obviously a lot of unpleasant work is done by non-entrepreneurs. But the maxim of "find something necessary but unpleasant and start a company doing it as a high-success-chance play" is also very true: entrepreneurs don't, as a class, all avoid the nasty stuff. In the UK, the phrase I'm looking for is "where there's muck, there's brass.")
  - moulder 9y ago
    Congrats: you made me register just to tell you to shut the f*ck up.
  - danielpatrick 9y ago
    lol. What?
  - et-al 9y ago
    Along those lines, the idea of meeting a millionaire who makes bottle caps tickles me more than meeting most well known entrepreneurs like Phil Knight. Something about commonplace, yet invisible products.
- mseebach 9y ago
  > Capitalism is a competition. [...] You won because someone lost. This is false, and frankly a bit insulting.
deleted 9y ago
[deleted]
iamgopal 9y ago
Haha, nice try.
jondubois 9y ago
This comment just shows the power of the survivor bias. Face it; you're a survivor and your friends are survivors too; you're all biased. Maybe you know wealthy investors, maybe you live in the US - You cannot take this for granted; very few people have these things. I have met several very smart people who have done great things but have not been fortunate enough to succeed financially because (for example) some well-funded, well-connected silicon valley competitor came out of nowhere and took all the market share through the sheer force of advertising. Many things can go wrong.
danielpatrick 9y ago
There was a comic in XKCD recently that asked everyone to preface their inspirational speeches with a disclaimer about Survivorship bias. You should read that.
shubhamjain 9y ago
> For example, one of the great discoveries in my life is that in business if you don't know how to do something you can just hire the person to teach you or your team or just do it for you. Are you sure this is the right thing to learn considering how many businesses ran out of money because of hiring too soon? In fact, prevalent advice is to not push the hiring pedal until it becomes unmanageable.
taway_1212 9y ago
> Like fear, you should take Survivorship bias into account, but it should not dominate you. If you do you will do nothing in life. Taking a (for example) safe route into early retirement is not "doing nothing". Most of the startup founders will still be working (because X years invested into a failed startup has set them back) when I'll be retired sipping drinks on the beach.
UK-AL 9y ago
This is literally a textbook example survivorship bias. I have known people start companies who do everything right. Have studied all literature, hired great people. Still failed. I have known who do have the first clue about running business, fumbled their way around. Tried do everything themselves. Yet Succeeded. To the last guy, entrepreneurship is easy and everyone can do it. To the first guy it is hardest thing ever.
taneq 9y ago
> Like fear, you should take Survivorship bias into account, but it should not dominate you. If you do you will do nothing in life. I think it helps to consider which things done by successful people were necessary. Don't worry so much about whether they were sufficient, because that's going to involve a whole bunch of luck as well. But you can't win if you don't play.
bigtimeidiot 9y ago
>I found most serious people succeed in business. Business failure = not serious. Got it. >But I know some billionaires and do not envy them. So you know multiple billionaires and think your situation is normal?

BoiledCabbage 9y ago

> I found most serious people succeed in business. It is not that hard to become a millionaire, way easier than being a salaried person This is the trouble with discussions on this topic. Everytome Survivorship bias comes up, someone provides "counter evidence" which happens to be a picture perfect example of survivorship bias. Most serious people don't succeed in business. It is hard to become a millionaire. Way more people with the exact traits you'd describe as being what's needed for success have failed than succeeded.

thenomad 9y ago
Way more people with the exact traits you'd describe as being what's needed for success have failed than succeeded. Do you have proof of that assertion? I'd tend to largely agree with the OP, although I think he's overstating the point a bit. It's certainly not a great deal harder to get to the millionaire point as an entrepreneur than as a conventional salaried worker - assuming you have the appropriate character traits. If you're a self-starter with a fair amount of willpower and the ability to effectively learn, lifestyle businesses (as distinct from unicorns) are not massively tricky to grow. They're not easy, and there's definitely a learning curve, but it's on the "doable" end of the scale. (Background: I've built a few, and I teach other people to build them.) Addendum: we should probably also start by defining "failed" here. If you mean "way more people's first businesses fail than succeed", I'd agree with you, absolutely. If you mean "way more people have started more than 8 businesses following best practice and have had zero successes than have had any success", I'm much more skeptical. It's an axiom - even in the talks by famous successful people mentioned in the comic - that you generally need a few attempts to get the hang of launching and running anything.
- aaron-lebo 9y ago
  Just take a look at the average YC batch. If anyone is set up to succeed, it is those guys with coaching, resources, and connections. Most of them don't become wildly successful and are only successful in any sense because of the ability to pivot, learn lessons, etc. (see Schwartz's Infogami -> Reddit transition). Or check out small business failure rates. More anecdotally and less scientifically, watch retail/food locations which have business after business after business open in them. A successful lifestyle business takes a lot of learned knowledge, and by virtue of building a single one you've had more success than most. Just beating the odds on one was your survival, once you did that you had a lot of advantages. Bigger serial entrepreneurs often have similar patterns. One success allow you to make another which allows you to make another, all with varying degrees of success and with failure effectively subsidized. See Mark Cuban, Ev Williams, Pewter Thiel.
  - thenomad 9y ago

arximboldi 9y ago

> It is not that hard to become a millionaire, way easier than being a salaried person Sure. If it is not so hard, everyone would do it. If everyone was a millionaire, who would do actual unpleasant work? Who would clean, run hospitals, build infrastructure? Who would work for your startup so you can make money? Your comment is such an example of survivorship bias! Capitalism is a competition. You won, good for you. Don't tell the rest they can win too, that's insulting. You won because someone lost.

thenomad 9y ago
The "actual unpleasant work" is to a significant extent the domain of entrepreneurs. For example, cleaning companies - often started by one person doing the cleaning - are an absolutely textbook example of entrepreneurship. Some of those entrepreneurs then become millionaires :) (Updating this post: obviously a lot of unpleasant work is done by non-entrepreneurs. But the maxim of "find something necessary but unpleasant and start a company doing it as a high-success-chance play" is also very true: entrepreneurs don't, as a class, all avoid the nasty stuff. In the UK, the phrase I'm looking for is "where there's muck, there's brass.")
- moulder 9y ago
  Congrats: you made me register just to tell you to shut the f*ck up.
- danielpatrick 9y ago
  lol. What?
- et-al 9y ago
  Along those lines, the idea of meeting a millionaire who makes bottle caps tickles me more than meeting most well known entrepreneurs like Phil Knight. Something about commonplace, yet invisible products.
mseebach 9y ago
> Capitalism is a competition. [...] You won because someone lost. This is false, and frankly a bit insulting.

deleted 9y ago

[deleted]

iamgopal 9y ago

Haha, nice try.

jondubois 9y ago

This comment just shows the power of the survivor bias. Face it; you're a survivor and your friends are survivors too; you're all biased. Maybe you know wealthy investors, maybe you live in the US - You cannot take this for granted; very few people have these things. I have met several very smart people who have done great things but have not been fortunate enough to succeed financially because (for example) some well-funded, well-connected silicon valley competitor came out of nowhere and took all the market share through the sheer force of advertising. Many things can go wrong.

danielpatrick 9y ago

There was a comic in XKCD recently that asked everyone to preface their inspirational speeches with a disclaimer about Survivorship bias. You should read that.

shubhamjain 9y ago

> For example, one of the great discoveries in my life is that in business if you don't know how to do something you can just hire the person to teach you or your team or just do it for you. Are you sure this is the right thing to learn considering how many businesses ran out of money because of hiring too soon? In fact, prevalent advice is to not push the hiring pedal until it becomes unmanageable.

taway_1212 9y ago

> Like fear, you should take Survivorship bias into account, but it should not dominate you. If you do you will do nothing in life. Taking a (for example) safe route into early retirement is not "doing nothing". Most of the startup founders will still be working (because X years invested into a failed startup has set them back) when I'll be retired sipping drinks on the beach.

UK-AL 9y ago

This is literally a textbook example survivorship bias. I have known people start companies who do everything right. Have studied all literature, hired great people. Still failed. I have known who do have the first clue about running business, fumbled their way around. Tried do everything themselves. Yet Succeeded. To the last guy, entrepreneurship is easy and everyone can do it. To the first guy it is hardest thing ever.

taneq 9y ago

> Like fear, you should take Survivorship bias into account, but it should not dominate you. If you do you will do nothing in life. I think it helps to consider which things done by successful people were necessary. Don't worry so much about whether they were sufficient, because that's going to involve a whole bunch of luck as well. But you can't win if you don't play.

bigtimeidiot 9y ago

>I found most serious people succeed in business. Business failure = not serious. Got it. >But I know some billionaires and do not envy them. So you know multiple billionaires and think your situation is normal?