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Forced Entrepreneurs

• varispeed 5y ago
  It's interesting that "venture backing" is considered as something normal, a success even. Being approved by your rich overlords. Workers have to pay huge tax, whereas corporations don't. So workers are less able to amass capital and because of that they are forced to share their business with VC. If you were a rich VC owner, surely you would lobby politicians to ensure entrepreneurs are dependent on you. I think this is sickening. Corporate feudalism?
  • rmac 5y ago
    vc's job: find and invest in companies that will make large amounts of money. if they are good at their jobs, these companies will make them large amounts of money and in so doing employ a large pool of workers. if what I just wrote is true, then I can see how others might use vc-backed companies as a proxy for broad economic gains
    • cratermoon 5y ago
      > and in so doing employ a large pool of workers. Uber and DoorDash have entered the chat...
    • hogFeast 5y ago
      Some people view any trade where the other side wins to any degree as exploitative. Regardless of whether they gain themselves. It is an interesting thought pattern.
  • bsedlm 5y ago
    yes but the "lord" is a publically traded corporation.
  • solumos 5y ago
    This is a pretty zero-sum way to look at VC/investment/startups. In reality, GPs have to hustle to get LPs to invest in their fund. Then, they're able to take that money and create a portfolio out of it by investing in big opportunities. They really only want to invest in businesses that can exceed a $1B valuation (sometimes $10B these days). The very best VCs have a track record of identifying $1B+ opportunities and helping those companies get there. As a founder, if your business doesn't fit that mold you probably shouldn't raise from VCs. There are angels out there with a higher risk tolerance who write fewer checks and are more interested in contributing directly to a company's success outside of capital. The idea that workers are diluted by the VCs is usually bogus. In an upside scenario, everyone wins. In a neutral exit scenario, the employees get to keep their wages, the investors get their money paid out first (if there's any left) and the founders/employees get hosed. In a downside scenario, everyone loses, except employees still get to keep their wages earned. It seems like you're conflating wage workers vs VC vs founder. Each of these roles has a wildly different risk profile when it comes to a startup.
• jtdev 5y ago
  This report seems to reinforce a notion that I've had for quite some time: The latest tech entrepreneur hype cycle is churning out very enthusiastic, hopeful/jr. entrepreneurs who have nearly nothing to offer in terms of vision, product, service, technical ability, etc. Being an "entrepreneur" is a means to and end, not and end in and of itself.
• thiago_fm 5y ago
  That's why FED should stop the money printing press and let the chips fall where they may. I've been for a long time waiting for that crisis to pop up and I go back to my community to try something new, not as an employee but as an employer. Many other software devs shared common concerns with me, like that it isn't worth to drop the ball now that salaries are sky high. I think a recession would definitely annoy people, but like when it rains, it would clean up a lot of things. Too many zombie companies going on, big tech getting so much money as it seems the only thing that will stick around post-crisis. We need to shed the tears before there is progress. Can't keep holding this thing on forever.
  • deleted 5y ago
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  • Taylor_OD 5y ago
    > I think a recession would definitely annoy people, but like when it rains, it would clean up a lot of things. Too many zombie companies going on, big tech getting so much money as it seems the only thing that will stick around post-crisis. Annoy people is a funny way to describe poverty.
    • thiago_fm 5y ago
      Poverty can only be really fixed by tackling poverty. In a country where discussing universal healthcare and basic needs coverage is a considered extreme leftist ideas. I am not impressed that people are worried about recession and the life of the poor. Sure, in a recession, Elon Musk might get poorer, but it isn't the same kind of poverty that affects the poor. If US wants to tackle it properly, first solve the initial issues. It is possible to have a recession where poor people aren't the ones most affected, it's all a matter of approving policies, laws and really looking after the poor. A recession where some rich people that took more risk than they should and get punished isn't bad. What is bad is workers depending so much on their employers to survive. Well, in the US that would get tagged as communism. Best regards from Germany.
      • 5y ago
• michaelt 5y ago
  > Posted: 29 Jun 2016 Last revised: 11 May 2021 It's a few years since I've been in academia, but is it normal these days for papers to receive five years of updates? Or to be five years old and still "forthcoming"?
  • zhdc1 5y ago
    I don't know what happened in this particular case, but it's fairly common for articles in higher ranked business journals to spend several years in the working draft -> revision -> acceptance pipeline.
    • Cyril_HN 5y ago
      Why do business journals work that way?
• dumbfoundded 5y ago
  A big factor in entrepreneurship that is undervalued is desperation. When you have a cushy tech job to fall back on, you simply won't try as hard as when you have no safety net. Right now it feels like it's okay to fail and you're only really risking the opportunity cost of a higher salary. "Forced entrepreneurs" risk great personal consequences because they have no other options. I'm not sure if this is a good or bad thing for society.
  • mettamage 5y ago
    It can lead to chronic stress. Chronic stress can kill in the worst case. I think Elon Musk is a good public example of what (chronic) stress can do despite being financially successful.
    • dumbfoundded 5y ago
      It's definitely way more stressful but it's a balance. I think having too little stress can be just as unhealthy as too much stress. Some amount of stress is necessary to feel engaged and important in the activities you work on. You can work at a big company and feel completely unnecessary to the world. As a founder, finding the balance is extremely difficult but a very rewarding journey if you can sustain it. There's a certain zen about finding peace and focus in a chaotic situation.
    • DelightOne 5y ago
      Sure it's stress, but it also gives you control, gives you the tools and people you need to deal with it. In a job you don't necessarily have those.
    • bigbillheck 5y ago
      Musk might have a lot of chronic, but it's not stress.
      • deleted 5y ago
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• MattGaiser 5y ago
  Anecdotally, what happened to the entrepreneurs in your networks when this thing hit? In my network, most of them seem to have used the skilled remote work boom to get regular jobs until this has all passed.
• starkd 5y ago
  Maybe forced entrepreneurs are also more eager to accept venture capitol or buyout offers earlier than voluntary entrepreneurs.
• adabyron 5y ago
  Unless you work for a great company as a software engineer, you can make/keep significantly more money as your own company. The past few years have punished W-2 wages even more when compared to non-W-2 earners or people who partial incomes from W-2. PPP Loans, SEP-IRAs, QBI deduction, plus plenty of other random deductions as well that are no where near the sketchy deductions that certain people take such as hair/makeup. Like many things, this doesn't apply only to software engineers but any job that you can easily contract out or do plenty of remote work. The current US tax structure encourages entrepreneurship. At the same time it seems to make it slightly scary/challenging with tons of ridiculous paper work, especially if you move across state lines. Oh & paying taxes is a pain. If someone wanted a huge unicorn type business idea, making it super easy to handle all this garbage would be nice. Most places are either to expensive for a single or tiny business, or don't offer enough help. Huge opportunity with an expanding niche & no one is doing it really well.
  • xwdv 5y ago
    > Unless you work for a great company as a software engineer, you can make/keep significantly more money as your own company. This comes at the expense of time and energy. Running a "company" will involve a lot of other things beyond software engineering. Like stocks, there's also no guarantee you will beat the market (the market being the best salary you can get). The most time and energy efficient way to make money with little risk is still to take a standard software engineering job, don't take on unnecessary responsibilities, and just work remote to eliminate commute (you don't get paid for commute time but because you still have to do it you have to account for it as part of your work hours, which can vastly reduce your true hourly rate).
    • adabyron 5y ago
      If you have one or two solid long term clients, the running a company is minimal once you're setup. You pay yourself a salary, do a few quarterly state tax items & a monthly payment to the IRS. It's usually the initial setup that is the biggest pain & if you ever make any changes like wanting to move states or addresses. This is where I think a service would be really beneficial. At the same time, the amount of time/revenue lost to this is less than the amount gained by tax benefits. I mean every company made 5 months of salary plus benefits per employee from the PPP loan over the past 2 years. That alone was huge. From personal experience, it sounds like "the best salary you can get" requires hunting for decent opportunities, studying for tons of ridiculous interview questions, networking with employees at the company to get a leg up & of course taking a ton of interviews. Plenty of time/energy goes into that as well. Of course you can counter argue that getting clients takes plenty of time energy. So it maybe comes down to each person's own unique situation and which opportunity is best for them. I've found that doing great work, gets your name out there & marketing is not required. Learning to say "no" to jobs tends to be required more than marketing.
• varispeed 5y ago
  These days you are unable to climb the class ladder as an employee. Any income that you could have saved is being eaten by progressive tax (that is being used to subsidise low wages among other things - big corporations avoid paying tax and pay low wages that other workers have to bump out of their pay). Only way to escape working class and poverty is starting a business. This also is becoming more difficult as big corporation lobby for more regulation and for increase of barriers to entry for new players. Big corporations need smart people as wage slaves, not as competitors. This is something that is not being looked enough into, mainly because politicians have no incentive to do it. It is easier for them to accept donations from rich friends and source votes by promising more social programs and more subsidies for target voter salaries.
• doggodaddo78 5y ago
  Yuuup. Nothing like being homeless, hungry, and broke to focus the mind into "hunger," unlike Ivy Leaguers' dabbling into staplers as a service or Juicero.
• vmception 5y ago
  > firms founded by forced entrepreneurs are more likely to survive, innovate, and receive venture-backing Actually this result surprises me. The survivorship bias I was expecting was that upper middle class and upper class people got opportunities to try ideas over and over again because their funding never ran dry. And therefore we get to hear misleading stories about entrepreneurs starting from their garage, but turns out the garage was at a home in Atherton, the most expensive zip code deep in Silicon Valley.