Nitpick: it would be more correct and precise to say that index funds tracking the total market beat the average aggregate performance of hedge funds on a long

Nitpick: it would be more correct and precise to say that index funds tracking the total market beat the average aggregate performance of hedge funds on a long enough timeline. In practice that timeline tends to be quite short in the current market climate. I mention this because (regardless of your intention in particular) Warren Buffett's famous bet is extremely overused and cited as evidence for many claims it doesn't really support. Someone's takeaway from your comment could be that all hedge funds fail to beat the market - but that's not even what Warren Buffett believes (Buffett doesn't believe in the efficient market hypothesis). This is to say that index funds are generally a superior investment vehicle for modal investors. But that shouldn't be used to extrapolate broader truths about active versus passive management, except that active management is a lot harder. An (imperfect) analogy I like to use is that of a kid whose dream is to get drafted into the NBA. You'd probably tell them to have a solid backup plan for a more realistic way to make a living, because approximately no one is drafted into the NBA. Vastly more people try and fail than are actually drafted. But that doesn't tell us the NBA is itself a fiction. Similar parallels exist in venture capital investment, startup success, acting and making music.