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A nice analogy but it doesn't work. There aren't that many entrepreneurs who failed multiple times before succeeding at a business. If you look at the big busi

A nice analogy but it doesn't work. There aren't that many entrepreneurs who failed multiple times before succeeding at a business. If you look at the big businesses that dominate the US tech economy, they're all first time founders (Amazon, Apple, Google, Microsoft etc). There are also very few entrepreneurs bootstrapping their own business. Even rich kids go to VC, they aren't usually risking their own funds. Finally, if you try multiple times, learn something important from each failure, and then succeed, it seems reasonable to claim that this is now due to the skills you developed and not mere luck. You can't even claim it's privilege - it might be, but as this article argues, being an entrepreneur isn't being handed a nice life on a plate even if you're successful. For sure there are counter-examples where some rich kid spent their parents money trying and failing over and over, then got lucky without learning anything, somehow had an incredibly easy life from that point on and then started talking about merit. But they're going to be the exceptions that prove the rule. The carnival analogy therefore feels like ideologically motivated reasoning of the most common Marxist kind (claiming hard work and risk taking don't matter, that all success in life is the inherited privilege of capital).

jotjotzzz 4y ago
This sounds like survivorship bias. Rich kids have a golden parachute for a smoother fall than all the other kids. In addition, most rich kids belong to wealthy, well-connected parents who have already built a network for them. Middle-class to poor kids do not have these resources. However, that doesn't mean bootstrapping will not work. But it is harder for them than rich kids to build a multi-million business.
vlovich123 4y ago
I think you need to leave tech and VC money. VC’s are happy to throw money behind a bunch of smart college kids. Go try to go a different route and see all the doors shut. Also you don’t get to see all the people who don’t try their hand at entrepreneurship because the gamble is too great for them.
- revelio 4y ago
  Yes, but the reason it's harder to get money for those sorts of businesses is because they're much less likely to generate large returns. The BBC couldn't / didn't want to find any tech entrepreneurs for this article (it's not like the UK doesn't have them), so they focus on people doing contracting or agency work. Of course it'll be tough to get investment in such a low margin and competitive business, VCs don't invest in tech outsourcing body shops either. There just isn't the possibility of large profits without product development.
  - vlovich123 4y ago
    Except a huge amount of VC plays are basically just gambling on someone succeeding. They don’t care who. So you’ve got 1 success story for every 100 attempts. Sure that 1 generated outsized returns, but that doesn’t help the 100 that failed and lost time and money they could have gotten elsewhere. Additionally, VC plays are often are parasitic endeavors that try to acquire monopoly positions by flooding the market to corner it (ie kill all competition) before raising prices (eg Uber prices raise to pretty close to taxis once the local taxis have been run out of business). If you prevented flooding the market as a tactic, the entrepreneurship model would change drastically. And that is something we used to try to prevent but for some reason we only did it once for the commodities market but let it continue unabashed everywhere else.
  - HPsquared 4y ago
    Most businesses don't generate extraordinarily large returns. Successful tech companies are in the long tail. Where's the investment in the middle?
    - revelio 4y ago
      That exists but it goes by names we don't use much here like corporate paper, bonds, etc. Bigger than a bank loan but smaller than a (modern) VC round.
endisneigh 4y ago
> There aren't that many entrepreneurs who failed multiple times before succeeding at a business. If you look at the big businesses that dominate the US tech economy, they're all first time founders (Amazon, Apple, Google, Microsoft etc). For this analysis to be complete you'd have to look at all companies, not an arbitrary selection of tech companies. Furthermore, tech is unique (and so is the list of your companies) in that one couldn't have started a similar company before the ones you listed since modern tech literally had just begun. A better example would be to look at the new generation of tech companies, such as OpenAI, if you want to focus on tech. Finally, let's look at your companies: Microsoft - was not Bill Gates' first company. Amazon - It's true the name was the same, but the company pre and post 1998 (Amazon as a bookstore, and then Amazon as an ecommerce site, and then the development of what is known as AWS in the early 2000s) was fundamentally different. The only real similarity is the name. Google - it's true Brin and Page started this company first, but they had effectively done all the work for "free" as part of their PhD (at Stanford, no less). Keeping up with the parent post analogy, there was not much risk here. Apple - Similar to Amazon in that Apple as a name and company had continuity from now to its beginning, but Steve Jobs started Next which you could argue is the DNA of modern Apple (it merged back with the almost then defunct Apple), as well as Pixar.
- Sebb767 4y ago
  > Amazon - It's true the name was the same, but the company pre and post 1998 (Amazon as a bookstore, and then Amazon as an ecommerce site, and then the development of what is known as AWS in the early 2000s) was fundamentally different. The only real similarity is the name. > Apple - Similar to Amazon in that Apple as a name and company had continuity from now to its beginning, but Steve Jobs started Next which you could argue is the DNA of modern Apple (it merged back with the almost then defunct Apple), as well as Pixar. These two do not really support your point. The grandparent said: > There aren't that many entrepreneurs who failed multiple times before succeeding Starting a successful company and then used that basis to branch out into another successful company does not disprove this point.
  - endisneigh 4y ago
irjustin 4y ago
> A nice analogy but it doesn't work. Your analogies don't refute his claims the way you think they do. When you look at the FAANGs you're implicitly viewing from $$'s of the overall pie (top 99.99999%??) where as the parent comment is looking at it from they're just 5 founders amongst a sea of them (top 0.000001%?). Also, the founders of those companies aren't rags to riches they came from upper middle to upper class families. His quoted analogy stands well and yours generally helps it.
makeitdouble 4y ago
> There aren't that many entrepreneurs who failed multiple times before succeeding at a business. That seems counter-intuitive. You are looking at incredibly large corporations that came full form in a few decades only, and I'd wager their founder succeeding at the first try might be part of the whole miracle. Companies that mildly succeed could come from less miraculous founders who needed a few more tries. > Even rich kids go to VC It's more on whether they can effort to "waste" a few years in a startup instead of trying to build a career in a more stable company. They also don't need social branding: if you're trying to get a loan for your mortgage, working at IBM will help a lot compared to some random stealth startup. It's the same reason you'll find more well-off kids trying to make it as actors. It's just a risk most poor kids won't take. > due to the skills you developed and not mere luck It doesn't have to be a dichotomy of one or another. Just don't publish a book to tell the world "look at me: just work hard enough and everything is possible"
- oogali 4y ago
  Your average mortgage broker does not care about the name of the company on the check beyond conversation. The Fannie Mae underwriting manual and software[1] they use makes no mention of company prestige, age, etc. Simply, is there consistent pay stub history, do the bank accounts agree with the pay stub history, do the filed 1040s agree with job and bank account. If you have a non-average mortgage broker that cares about the name, then you’re in an SVB-like situation and we’ve all seen how that played out. 1: https://singlefamily.fanniemae.com/applications-technology/desktop-underwriter-desktop-originator https://singlefamily.fanniemae.com/applications-technology/d...
deleted 4y ago
[deleted]

jotjotzzz 4y ago

This sounds like survivorship bias. Rich kids have a golden parachute for a smoother fall than all the other kids. In addition, most rich kids belong to wealthy, well-connected parents who have already built a network for them. Middle-class to poor kids do not have these resources. However, that doesn't mean bootstrapping will not work. But it is harder for them than rich kids to build a multi-million business.

vlovich123 4y ago

I think you need to leave tech and VC money. VC’s are happy to throw money behind a bunch of smart college kids. Go try to go a different route and see all the doors shut. Also you don’t get to see all the people who don’t try their hand at entrepreneurship because the gamble is too great for them.

revelio 4y ago
Yes, but the reason it's harder to get money for those sorts of businesses is because they're much less likely to generate large returns. The BBC couldn't / didn't want to find any tech entrepreneurs for this article (it's not like the UK doesn't have them), so they focus on people doing contracting or agency work. Of course it'll be tough to get investment in such a low margin and competitive business, VCs don't invest in tech outsourcing body shops either. There just isn't the possibility of large profits without product development.
- vlovich123 4y ago
  Except a huge amount of VC plays are basically just gambling on someone succeeding. They don’t care who. So you’ve got 1 success story for every 100 attempts. Sure that 1 generated outsized returns, but that doesn’t help the 100 that failed and lost time and money they could have gotten elsewhere. Additionally, VC plays are often are parasitic endeavors that try to acquire monopoly positions by flooding the market to corner it (ie kill all competition) before raising prices (eg Uber prices raise to pretty close to taxis once the local taxis have been run out of business). If you prevented flooding the market as a tactic, the entrepreneurship model would change drastically. And that is something we used to try to prevent but for some reason we only did it once for the commodities market but let it continue unabashed everywhere else.
- HPsquared 4y ago
  Most businesses don't generate extraordinarily large returns. Successful tech companies are in the long tail. Where's the investment in the middle?
  - revelio 4y ago
    That exists but it goes by names we don't use much here like corporate paper, bonds, etc. Bigger than a bank loan but smaller than a (modern) VC round.

endisneigh 4y ago

> There aren't that many entrepreneurs who failed multiple times before succeeding at a business. If you look at the big businesses that dominate the US tech economy, they're all first time founders (Amazon, Apple, Google, Microsoft etc). For this analysis to be complete you'd have to look at all companies, not an arbitrary selection of tech companies. Furthermore, tech is unique (and so is the list of your companies) in that one couldn't have started a similar company before the ones you listed since modern tech literally had just begun. A better example would be to look at the new generation of tech companies, such as OpenAI, if you want to focus on tech. Finally, let's look at your companies: Microsoft - was not Bill Gates' first company. Amazon - It's true the name was the same, but the company pre and post 1998 (Amazon as a bookstore, and then Amazon as an ecommerce site, and then the development of what is known as AWS in the early 2000s) was fundamentally different. The only real similarity is the name. Google - it's true Brin and Page started this company first, but they had effectively done all the work for "free" as part of their PhD (at Stanford, no less). Keeping up with the parent post analogy, there was not much risk here. Apple - Similar to Amazon in that Apple as a name and company had continuity from now to its beginning, but Steve Jobs started Next which you could argue is the DNA of modern Apple (it merged back with the almost then defunct Apple), as well as Pixar.

Sebb767 4y ago
> Amazon - It's true the name was the same, but the company pre and post 1998 (Amazon as a bookstore, and then Amazon as an ecommerce site, and then the development of what is known as AWS in the early 2000s) was fundamentally different. The only real similarity is the name. > Apple - Similar to Amazon in that Apple as a name and company had continuity from now to its beginning, but Steve Jobs started Next which you could argue is the DNA of modern Apple (it merged back with the almost then defunct Apple), as well as Pixar. These two do not really support your point. The grandparent said: > There aren't that many entrepreneurs who failed multiple times before succeeding Starting a successful company and then used that basis to branch out into another successful company does not disprove this point.
- endisneigh 4y ago

irjustin 4y ago

> A nice analogy but it doesn't work. Your analogies don't refute his claims the way you think they do. When you look at the FAANGs you're implicitly viewing from $$'s of the overall pie (top 99.99999%??) where as the parent comment is looking at it from they're just 5 founders amongst a sea of them (top 0.000001%?). Also, the founders of those companies aren't rags to riches they came from upper middle to upper class families. His quoted analogy stands well and yours generally helps it.

makeitdouble 4y ago

> There aren't that many entrepreneurs who failed multiple times before succeeding at a business. That seems counter-intuitive. You are looking at incredibly large corporations that came full form in a few decades only, and I'd wager their founder succeeding at the first try might be part of the whole miracle. Companies that mildly succeed could come from less miraculous founders who needed a few more tries. > Even rich kids go to VC It's more on whether they can effort to "waste" a few years in a startup instead of trying to build a career in a more stable company. They also don't need social branding: if you're trying to get a loan for your mortgage, working at IBM will help a lot compared to some random stealth startup. It's the same reason you'll find more well-off kids trying to make it as actors. It's just a risk most poor kids won't take. > due to the skills you developed and not mere luck It doesn't have to be a dichotomy of one or another. Just don't publish a book to tell the world "look at me: just work hard enough and everything is possible"

oogali 4y ago
Your average mortgage broker does not care about the name of the company on the check beyond conversation. The Fannie Mae underwriting manual and software[1] they use makes no mention of company prestige, age, etc. Simply, is there consistent pay stub history, do the bank accounts agree with the pay stub history, do the filed 1040s agree with job and bank account. If you have a non-average mortgage broker that cares about the name, then you’re in an SVB-like situation and we’ve all seen how that played out. 1: https://singlefamily.fanniemae.com/applications-technology/desktop-underwriter-desktop-originator https://singlefamily.fanniemae.com/applications-technology/d...

deleted 4y ago

[deleted]