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For most people, owning 100% of a company making $1M/year would be preferable to owning 10% of a company making $1B. It's not just that money has decreasing mar

For most people, owning 100% of a company making $1M/year would be preferable to owning 10% of a company making $1B. It's not just that money has decreasing marginal value. It's about what life you want to live. The ten percent life is... just not for everyone, and maybe not for anyone, which is why it needs to be incentivized so much to ever happen.

ansq 7y ago
Owning 10% doesn't mean you're a peon. At 10% of a 1B company you probably have a good amount of autonomy. Some people take pride in creating products that are widely used + lots of jobs.
- speedplane 7y ago
  > Owning 10% doesn't mean you're a peon. If you own anything, you're not a peon. However, owning 100% of something is simply a very different mindset than owning just 99% of something. In the former, you solely control you own destiny. In the latter example, you're beholden or subject to others. Not necessarily bad, but a very different experience. Kind of like long term dating versus getting married.
speedplane 7y ago
> For most people, owning 100% of a company making $1M/year would be preferable to owning 10% of a company making $1B. It's not just that money has decreasing marginal value. It's about what life you want to live. Being in control of your life, or of anything, is a huge benefit and comes with a big premium. When one company acquires a public company, they usually pay more than the public stock price. If you don't drive to work, owning a car is very likely more expensive than renting, but many buy because control over when and how to drive is gained is worth the cost.
- heavenlyblue 7y ago
  >> owing a car But there are no car rentals which would bring a car to your door in the next 15 minutes.
  - hawkice 7y ago
    Isn't that what Uber and Lyft do? I don't own a car and that's how I use them. I'm not precious about being the driver.
  - andygcook 7y ago
    I saw this service mentioned in another HN article about YC life last week and thought it was interesting: https://drivekyte.com/ https://drivekyte.com/ A driver delivers the car rental to wherever you want then leaves on an electric scooter.
  - dnh44 7y ago
    There is a small car rental company in my town that does just this although it's more like an hour rather than 15 minutes. They've got all of my details on file so it's as easy as a 10 second phone call because the person recognises me by voice.
adriand 7y ago
> It's not just that money has decreasing marginal value. It's about what life you want to live. I reached a point where I realized that the life experiences I was having were essentially the same as what much richer people are able to enjoy. A great example is when we got a pool. My wife had talked about it for a while, we have young kids and an unusually large backyard for a downtown home, and thought it'd be a great addition to our property. So I looked into it and it was going to cost at least $40,000 to $60,000 for an in-ground pool. So I went to Walmart and bought the biggest above-ground, self-assembly pool I could find. It cost me $400 for a 16' diameter, 4' deep pool which holds somewhere around 15,000 litres of water (IIRC). A couple of days later my wife and I were sitting in inflatable chairs, floating in our pool and drinking cocktails in our backyard. At that moment I realized that for 1% of the investment I was having at least 90% of the enjoyment. The experience of laying in an inflatable chair with your feet in the water and the sun beating down on you while you sip Aperol spritzes is essentially identical no matter the size and type of pool so long as it's deep enough to float in. The same goes for so many other experiences: a rich person can buy a $250,000 car, but at the end of the day, their butt is on a seat like us and their hands are on a wheel like us and they're stuck in traffic just like us. If you can afford a helicopter, that's certainly a step change in terms of experience, but the sacrifices you have to make to get one and the overall chances of reaching that point just don't make it an appealing path for me. The truth is, if you want a pool because you like floating in water, then the Walmart pool is enough. If you want a pool because you want your friends to envy how much money you have, then nothing will ever be enough. Enjoy what you have!
est31 7y ago
Founders often have controlling shares in their companies. This means they control a $1B revenue company instead of a $1M one, can become CEO if they want, etc. CEO salary for a $1B revenue company is more than for a $1M revenue one. Also, if you own 100% you are the only person who is worried that the company is doing well. As often said, with great power comes great responsibility and in this instance it means you are the only person responsible that your 100% owned company is doing well. You can't just hire a manager. $1M/year revenue won't attract any good managers. They are going for the $1B/year class of companies. If a company has multiple shareholders, it has multiple people who care about share value increases. Investors are usually well networked.

ansq 7y ago

Owning 10% doesn't mean you're a peon. At 10% of a 1B company you probably have a good amount of autonomy. Some people take pride in creating products that are widely used + lots of jobs.

speedplane 7y ago
> Owning 10% doesn't mean you're a peon. If you own anything, you're not a peon. However, owning 100% of something is simply a very different mindset than owning just 99% of something. In the former, you solely control you own destiny. In the latter example, you're beholden or subject to others. Not necessarily bad, but a very different experience. Kind of like long term dating versus getting married.

speedplane 7y ago

> For most people, owning 100% of a company making $1M/year would be preferable to owning 10% of a company making $1B. It's not just that money has decreasing marginal value. It's about what life you want to live. Being in control of your life, or of anything, is a huge benefit and comes with a big premium. When one company acquires a public company, they usually pay more than the public stock price. If you don't drive to work, owning a car is very likely more expensive than renting, but many buy because control over when and how to drive is gained is worth the cost.

heavenlyblue 7y ago
>> owing a car But there are no car rentals which would bring a car to your door in the next 15 minutes.
- hawkice 7y ago
  Isn't that what Uber and Lyft do? I don't own a car and that's how I use them. I'm not precious about being the driver.
- andygcook 7y ago
  I saw this service mentioned in another HN article about YC life last week and thought it was interesting: https://drivekyte.com/ https://drivekyte.com/ A driver delivers the car rental to wherever you want then leaves on an electric scooter.
- dnh44 7y ago
  There is a small car rental company in my town that does just this although it's more like an hour rather than 15 minutes. They've got all of my details on file so it's as easy as a 10 second phone call because the person recognises me by voice.

adriand 7y ago

> It's not just that money has decreasing marginal value. It's about what life you want to live. I reached a point where I realized that the life experiences I was having were essentially the same as what much richer people are able to enjoy. A great example is when we got a pool. My wife had talked about it for a while, we have young kids and an unusually large backyard for a downtown home, and thought it'd be a great addition to our property. So I looked into it and it was going to cost at least $40,000 to $60,000 for an in-ground pool. So I went to Walmart and bought the biggest above-ground, self-assembly pool I could find. It cost me $400 for a 16' diameter, 4' deep pool which holds somewhere around 15,000 litres of water (IIRC). A couple of days later my wife and I were sitting in inflatable chairs, floating in our pool and drinking cocktails in our backyard. At that moment I realized that for 1% of the investment I was having at least 90% of the enjoyment. The experience of laying in an inflatable chair with your feet in the water and the sun beating down on you while you sip Aperol spritzes is essentially identical no matter the size and type of pool so long as it's deep enough to float in. The same goes for so many other experiences: a rich person can buy a $250,000 car, but at the end of the day, their butt is on a seat like us and their hands are on a wheel like us and they're stuck in traffic just like us. If you can afford a helicopter, that's certainly a step change in terms of experience, but the sacrifices you have to make to get one and the overall chances of reaching that point just don't make it an appealing path for me. The truth is, if you want a pool because you like floating in water, then the Walmart pool is enough. If you want a pool because you want your friends to envy how much money you have, then nothing will ever be enough. Enjoy what you have!

est31 7y ago

Founders often have controlling shares in their companies. This means they control a $1B revenue company instead of a $1M one, can become CEO if they want, etc. CEO salary for a $1B revenue company is more than for a $1M revenue one. Also, if you own 100% you are the only person who is worried that the company is doing well. As often said, with great power comes great responsibility and in this instance it means you are the only person responsible that your 100% owned company is doing well. You can't just hire a manager. $1M/year revenue won't attract any good managers. They are going for the $1B/year class of companies. If a company has multiple shareholders, it has multiple people who care about share value increases. Investors are usually well networked.