3 ms·
As others have pointed out this is a very old design pattern. In tech, it is this: Stage 1: Graduate college and get hired by a growing company. Observe all y
by ChuckMcM 6y ago
As others have pointed out this is a very old design pattern.
In tech, it is this:
Stage 1: Graduate college and get hired by a growing company. Observe all you can about what works and what doesn't while networking with the best people. Ideally a public company so that you can participate in its growth through equity ownership (stock options, employee purchase plans, Etc.)
Stage 2: Found (or join as founder) startup composed of good engineers you know, that is funded by VC money. Build it up to an exit to get a bigger slice of the pie given your greater equity.
Stage 3: Found a new company where it is primarily funded by your founders and not VC. Build that company up to an exit and you and your friends collect the big bucks as you still own most of the equity.
At this point you're independently wealthy and can do what ever you want with your life[1]
It has been the "silicon valley dream" for a lot of people over the last 30 years. And since each stage is typically 4 - 6 years that is really a 15 to 20 year plan.
Doesn't work for everyone though, and I have observed that people who are on this trajectory and recognize they are unlikely to reach orbit (so to speak), can get pretty vicious. You have a relatively short window to decide if the current stage is going to meet your goals for that stage or not, and if a stage doesn't provide the necessary lift, you probably only get one additional shot at making it work. As a result this path also leads to a place of depression for some.
[1] Assuming along the way you've learned to manage your wealth in a sustainable fashion.
- markus_zhang 6y agoNicely summarized.
- stingraycharles 6y ago> Doesn't work for everyone though I’d say that there is an extremely small portion of people that are able to complete Stage 2. “Doesn’t work for everyone” seems like an understatement. Stage 3 is probably easier to do once you completed stage 2, but still is very difficult. Really, how many people can you count that would have successfully pulled this off? 100 maybe?
- ChuckMcM 6y agoMy guess would be a few thousand in the Bay Area. Crunchbase could probably give you a better number by doing a bit of data mining on their database to find former Sun, Yahoo, Amazon, Facebook, Tesla, Apple, and Google employees who have gone on to create startups and exited those startups. Those companies alone have minted > 10,000 multi-millionaires who were simply employees at the company either prior to an IPO or prior to a large run up in value (like Apple). Of people I know who have stepped off at stage 2, they pocket enough wealth that they no longer have to work to maintain a moderate lifestyle, and then move to a place that interests them and work on other pursuits.
- thisalreadyiss 6y agoI think 90% failure rate at every stage is honest. I mean even stage 1 I am sure has an ever-increasing number of people that "want to learn to code" or go through an online bootcamp, watch a youtube series on javascript, etc. and never code professionally a day in their lives.
- ChuckMcM 6y agoI think it is challenging (but not impossible) to fail at stage 1. If you join any tech company that is already public and part of their compensation is incentive stock options and/or restricted stock which is refreshed annually, then 4+ years can deliver a pretty solid "boost" for you to do Stage 2. Stage 2 is harder of course, but 90% harder? A bunch of companies fail in the seed/series A stage. That can happen reasonably quickly (1 - 2 years), so stage 2 can take 3 - 5 years to catch the right one. And then stage 3 is kind of up to you're ability to hit the market at the right time. More difficult still, but not impossible.
- M5x7wI3CmbEem10 6y agoadvice for networking in stage 1?
- ChuckMcM 6y agoGet to know people. Talk to them at lunch time, or offer to help on their project when they are stuck, and ask for help on your project when your stuck. The latter is especially helpful for differentiating between people who talk a good game and actually know what they are talking about. Practice not assuming anything about someone based on their appearances. Learn to listen uncritically so that you can hear the insights they bring to the table. I know some folks who are genius level smart and have a horrible time trying to express themselves. I've often suspected it was because they think about things so differently that it is hard for them to translate how they think about something into concepts "normal" people understand.
- hinkley 6y agoIn games there are also production companies, and the studio might stay intact for years but produce their own games, as a stage 1.5 or alternate Stage 2. Most of the musicians who side with the recording industry have followed a similar pattern. They build their own studio (different definition of studio) to greatly increase their slice of the pie.
- kochthesecond 6y agoThis is such an understatement it feels like the equivalent to «buy low, sell high»