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People do with their money what they want, but a _MASSIVE_ mansion won't add much value to their life. And owning too many properties can be a real hassle. You

People do with their money what they want, but a _MASSIVE_ mansion won't add much value to their life. And owning too many properties can be a real hassle. You can have a large house or mansion, somewhere isolated (if that's what you want), but unless you have a family with 4 kids running, it can get lonely pretty fast.

cellis 9y ago
"But a _MASSIVE_ mansion won't add much value to their life". Not sure I agree. Have you ever seen the kind of parties you can throw in a mansion? That's quite a lot of value that you otherwise wouldn't have.
- astura 9y ago
  Unless you're throwing massive (40+ people) parties ever week it's more economical to buy an average sized house and rent massive space for when you throw huge parties
sulam 9y ago
Most of the examples used (with the very notable exception of the WeWork guy who honestly seems like he’s a con artist), are buying $4M homes in SF. That would be a mansion in most of the US, but it’s a typical family home in a decent neighborhood in SF. Also as the article points out, people aren’t using their stock to buy these places (Evan Spiegel being the exception). They are almost certainly using money they got when they (and often the rest of their employees) were offered the chance to take some money off the table in a later round of funding. Investors do this for a few reasons — they want a larger percentage that would cause more dilution than existing shareholders want to take, they want the founder focused on the home run IPO instead of potentially taking a buyout offer that would net the founder life-changing wealth but only be a single or a double for their fund, and probably more I’m not aware of. Point being, investors are fully involved participants in this — no one is being taken advantage of. (Again WeWork may be an exception — the external optics there are very bad.) Finally, using something like Dropbox as an example, Drew has built a multi-billion dollar company and his investors (with the possible exception of the last round which was basically an IPO without the listing) are very happy. Is a $9M condo really a sign that he’s not working hard? Anyone who knows him knows nothing could be further from the truth.
- charlesdm 9y ago
  Price has nothing to do with sq. ft. I think owning a (really nice) townhouse is fine, regardless of the purchase price. Some markets are just more expensive than others. Just pointing out that, just because a house is massive, it won't make you happy. It's often seen as a status symbol, though it doesn't make much sense anymore in this day and age in my eyes, unless you constantly have people around and you have a large family.
  - sulam 9y ago
    Statistics will quickly tell you price has something to do with sq ft. Location is the other thing that’s highly correlated. Yes, a big house won’t make you happy by itself. Neither will money, a girlfriend, kids (especially kids!), a bar where everyone knows your name, etc. You can be happy sharing a bedroom with two other people you don’t particularly like and you can be unhappy despite everything in your life going exactly how you hoped it would (speaking from experience here). But that’s human psychology, and I don’t think it’s useful to try and paychoanalyze why people are choosing to buy what they buy. Honestly, we all have better things to do with our time.

cellis 9y ago

"But a _MASSIVE_ mansion won't add much value to their life". Not sure I agree. Have you ever seen the kind of parties you can throw in a mansion? That's quite a lot of value that you otherwise wouldn't have.

astura 9y ago
Unless you're throwing massive (40+ people) parties ever week it's more economical to buy an average sized house and rent massive space for when you throw huge parties

sulam 9y ago

Most of the examples used (with the very notable exception of the WeWork guy who honestly seems like he’s a con artist), are buying $4M homes in SF. That would be a mansion in most of the US, but it’s a typical family home in a decent neighborhood in SF. Also as the article points out, people aren’t using their stock to buy these places (Evan Spiegel being the exception). They are almost certainly using money they got when they (and often the rest of their employees) were offered the chance to take some money off the table in a later round of funding. Investors do this for a few reasons — they want a larger percentage that would cause more dilution than existing shareholders want to take, they want the founder focused on the home run IPO instead of potentially taking a buyout offer that would net the founder life-changing wealth but only be a single or a double for their fund, and probably more I’m not aware of. Point being, investors are fully involved participants in this — no one is being taken advantage of. (Again WeWork may be an exception — the external optics there are very bad.) Finally, using something like Dropbox as an example, Drew has built a multi-billion dollar company and his investors (with the possible exception of the last round which was basically an IPO without the listing) are very happy. Is a $9M condo really a sign that he’s not working hard? Anyone who knows him knows nothing could be further from the truth.

charlesdm 9y ago
Price has nothing to do with sq. ft. I think owning a (really nice) townhouse is fine, regardless of the purchase price. Some markets are just more expensive than others. Just pointing out that, just because a house is massive, it won't make you happy. It's often seen as a status symbol, though it doesn't make much sense anymore in this day and age in my eyes, unless you constantly have people around and you have a large family.
- sulam 9y ago
  Statistics will quickly tell you price has something to do with sq ft. Location is the other thing that’s highly correlated. Yes, a big house won’t make you happy by itself. Neither will money, a girlfriend, kids (especially kids!), a bar where everyone knows your name, etc. You can be happy sharing a bedroom with two other people you don’t particularly like and you can be unhappy despite everything in your life going exactly how you hoped it would (speaking from experience here). But that’s human psychology, and I don’t think it’s useful to try and paychoanalyze why people are choosing to buy what they buy. Honestly, we all have better things to do with our time.