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Hmm. I have stuff to do so I can't follow up but I'm really dubious. Note this after the chart: General Motors has revenue of $600,000 per employee. GM? OHR

by earl 17y ago

Hmm. I have stuff to do so I can't follow up but I'm really dubious. Note this after the chart: General Motors has revenue of $600,000 per employee. GM? OHRLY? Perhaps the author conflates revenue and profit? Edit: in fact, the author actually notes this. Which makes the whole exercise stupid: If you don't have the data you need, you don't have the data you need and using the maximum value instead is useless. As should have been trivially obvious at the time the author wrote the blog post by examining one of his or her own examples.

SwellJoe 17y ago
I think it's worth noting how many of the world's top ten (or 20 or 50, etc.) richest people who earned it, rather than inheriting it, got there with software. Gates, Ballmer, Allen, Brin, Page, Ellison, etc. There are plenty of others, of course, who didn't get there with software. But the numbers certainly make it seem like software is a good way to get fantastically wealthy.
- mixmax 17y ago
  What most people forget that the worlds 50 richest people are outliers - after all there are only 50 of them in the world. The interesting thing would be to see how big a percentage of the worlds richest 5 million people made their money by creating and selling software. I'm not saying that you're wrong, just that the data doesn't support the view.
  - SwellJoe 17y ago
    That's true. I suspect oil has made dramatically more millionaires and billionaires than software has (but, having lived for many years in Texas, having a dad that worked as an engineer in the oil and gas industry, and then working myself for a few years on software for the oil and gas industry, my view of rich people and how they got that way may be skewed). But, I think maybe we're past the time when there are major opportunities for new people to make their fortune in oil. Though I do know some software developers who're rich because of the software they make for the oil and gas industry. Anyway, I don't know, either. We're all working with dramatically less data than we need to make an informed decision. But, since we're probably all strongest at technical stuff, rather than finance or arbitrage or whatever other ways folks make a billion dollars, I kinda think our best odds are in playing to our strengths.
    - krschultz 17y ago
      If you read the book Millionaires Next Door they pretty much tackle this problem and show that owners of small->medium sized businesses are the bulk of the millionaires. A lot of these businesses are just run of the mill things like construction, commercial real estate, service stations etc. The home runs from taking huge risks are few and far between.
      - SwellJoe 17y ago
        The Millionaire Next Door also reportedly has data problems, but, I think the idea of becoming one of those millionaires next door from software is also sound. I think the risks that have to be taken for those home runs in software are smaller, as well. What's the cost of a major construction project that can net millions in revenue vs. a major software project that can net millions in revenue? I was just think we're pretty lucky (or clever) to be working in a field that has produced so many billionaires in a short period of time, and now requires less risk and investment than ever before. It's a good time to be a nerd.
- deleted 17y ago
  [deleted]
- Dilpil 17y ago
  I would like to see this criteria for 'earned it'. Does working at a non software company count?
  - SwellJoe 17y ago
    This question makes no sense to me. I said, "earned it, rather than inherited it", which I think, is both clear in what I mean (the person made the money in their own lifetime through their own skill, luck, or hard work; rather than receiving the money from previous generations) and generic in how they could have made the money (any way that doesn't involve inheriting it from parents). Brin and Page did not have billionaire parents. They earned their billions. The Waltons were born into billions of dollars made by Sam Walton. They inherited it. Not a complicated distinction, and has nothing to do with whether they work on software or not. It was also not a judgment on the character of the people in question. It was a comment on how plausible it is that someone like you or me could become fantastically wealthy through various means. Software seems as good a means as any. That's the conversation I thought we were all having here.
    - Dilpil 17y ago
      The reply was made because there are indeed plenty of rich people who made fortunes outside of software, Sam Walton is a great example.
sethg 17y ago
It's not useless, because it's enough to make the author's point, which is that a piece of software that lots of people want to pay for isn't a license to print money.
JabavuAdams 17y ago
I'm trying to understand your first 2 paragraphs. Do you thing the revenue for GM is too high, or too low? If too high, then how could conflating profit and revenue possibly make the numbers higher? Profit per employee will always be less than revenue per employee.

by earl 17y ago

SwellJoe 17y ago

I think it's worth noting how many of the world's top ten (or 20 or 50, etc.) richest people who earned it, rather than inheriting it, got there with software. Gates, Ballmer, Allen, Brin, Page, Ellison, etc. There are plenty of others, of course, who didn't get there with software. But the numbers certainly make it seem like software is a good way to get fantastically wealthy.

mixmax 17y ago
What most people forget that the worlds 50 richest people are outliers - after all there are only 50 of them in the world. The interesting thing would be to see how big a percentage of the worlds richest 5 million people made their money by creating and selling software. I'm not saying that you're wrong, just that the data doesn't support the view.
- SwellJoe 17y ago
  That's true. I suspect oil has made dramatically more millionaires and billionaires than software has (but, having lived for many years in Texas, having a dad that worked as an engineer in the oil and gas industry, and then working myself for a few years on software for the oil and gas industry, my view of rich people and how they got that way may be skewed). But, I think maybe we're past the time when there are major opportunities for new people to make their fortune in oil. Though I do know some software developers who're rich because of the software they make for the oil and gas industry. Anyway, I don't know, either. We're all working with dramatically less data than we need to make an informed decision. But, since we're probably all strongest at technical stuff, rather than finance or arbitrage or whatever other ways folks make a billion dollars, I kinda think our best odds are in playing to our strengths.
  - krschultz 17y ago
    If you read the book Millionaires Next Door they pretty much tackle this problem and show that owners of small->medium sized businesses are the bulk of the millionaires. A lot of these businesses are just run of the mill things like construction, commercial real estate, service stations etc. The home runs from taking huge risks are few and far between.
    - SwellJoe 17y ago
      The Millionaire Next Door also reportedly has data problems, but, I think the idea of becoming one of those millionaires next door from software is also sound. I think the risks that have to be taken for those home runs in software are smaller, as well. What's the cost of a major construction project that can net millions in revenue vs. a major software project that can net millions in revenue? I was just think we're pretty lucky (or clever) to be working in a field that has produced so many billionaires in a short period of time, and now requires less risk and investment than ever before. It's a good time to be a nerd.
deleted 17y ago
[deleted]
Dilpil 17y ago
I would like to see this criteria for 'earned it'. Does working at a non software company count?
- SwellJoe 17y ago
  This question makes no sense to me. I said, "earned it, rather than inherited it", which I think, is both clear in what I mean (the person made the money in their own lifetime through their own skill, luck, or hard work; rather than receiving the money from previous generations) and generic in how they could have made the money (any way that doesn't involve inheriting it from parents). Brin and Page did not have billionaire parents. They earned their billions. The Waltons were born into billions of dollars made by Sam Walton. They inherited it. Not a complicated distinction, and has nothing to do with whether they work on software or not. It was also not a judgment on the character of the people in question. It was a comment on how plausible it is that someone like you or me could become fantastically wealthy through various means. Software seems as good a means as any. That's the conversation I thought we were all having here.
  - Dilpil 17y ago
    The reply was made because there are indeed plenty of rich people who made fortunes outside of software, Sam Walton is a great example.

sethg 17y ago

It's not useless, because it's enough to make the author's point, which is that a piece of software that lots of people want to pay for isn't a license to print money.

JabavuAdams 17y ago

I'm trying to understand your first 2 paragraphs. Do you thing the revenue for GM is too high, or too low? If too high, then how could conflating profit and revenue possibly make the numbers higher? Profit per employee will always be less than revenue per employee.