9 ms·

Embrace the desire to make money

123 points by swombat 13y ago

buzzcut 13y ago
The one thing this country (I'm speaking here of the US) doesn't have any discernable lack of is massive herds of people who are desperate to make more money. Lots of it. Piles of it. Mountains of it. And right now. If there is a clear and unambiguous, nearly universal, practically uncontested value in this country it's to make more money. That's not necessarily bad, but it often is, and frequently has both bad personal and economic consequences. Of course it's not even clear what we're talking about since "making money" isn't really defined in the article, and the kinds of salaries that are easily within reach of, I would assert, most professional HN readers (who are programmers), are airily dismissed with the claim of heavy taxation (which are actually near historical lows), and the costs of "maintaining a certain lifestyle" which is more or less a personal choice. If you are a person living in NYC or SF and you make $125,000 a year, and are unable to max out your 401k AND save at least a grand a month, then you are making extremely poor decisions. Now, that may not be the kind of money the author has in mind, but it ain't bad, and you can lead a decent lifestyle and save at the same time without much effort. There is, I think, some small truth to the claim that there is more talk of changing the world in SV than at, say, Lehman Brothers, but I think it's slightly naive not to see that this is often a thin tissue over the desire to make money. Not too many people go into to business and don't want to make money and a lot of it if they can. Talk of changing the world is prevalent precisely because the current software revolution makes it astoundingly more likely that you can make money AND change the world. That's certainly not true if you start a bodega and probably not true if you start a hedge fund. But in software it is. Software companies are changing the world in ways that are both trivial and profound, and some of them are even making a boatload of money at it. I don't see a lack of people who want to make money anywhere. I see a set of people who recognize that they can potentially have an outsized impact on the world and make a lot of money because software makes this massively more likely than at any time in the past. It just seems to me that the author both assumes a problem that doesn't really exist, and proposes an answer to said problem that is presented as more sure and easier than it actually is. But anyway I think the confusion is because we shift from getting rich at the beginning to "make enough money to be comfortable" at the end, so it's slightly confused: it's not about all out self-interested greediness he tells us, except at the end it is. And the social consequences of that mindset are just conveniently ignored. In the end there just doesn't have to be strong competition between the desire to make money and the desire to also do decent things in the world. It only seems that way when one of those desires (the first one) is grossly out of whack.
- jakejake 13y ago
  I think the author is talking about a very tiny bubble of, not just Silicon Valley, but also further limited to recent grads who are still living the college life and just starting companies. If you limit your world view to that group then I'm sure it seems like everybody is in it to change the world, and a goal of making money is not noble. I'm not a part of that group, so I don't really see that at all. Nobody that I personally know has any problem with making money. Not that we're all chasing money either, just that there's certainly no conflicting feelings going on.
davidw 13y ago
In general, a great point - it's something I should have thought about more, earlier when I was more of a head-in-the-clouds aspiring hacker. One detail, though: > somehow, many if not most people working in these high-wage jobs don't accumulate all that much money. This sounds plausible, but I'd prefer to see it backed up by statistics.
- thibaut_barrere 13y ago
  I don't have a bookmark unfortunately, but I read first hand a couple of years ago a study mentioning that employees did spend more and more as their wages went up (ultimately leading to golden handcuffs).
  - cpursley 13y ago
    It's called lifestyle inflation.
    - thibaut_barrere 13y ago
      Great, thanks - I never saw that term before.
- edanm 13y ago
  The book "The Millionaire Next Door" [1] talks about this in quite a lot of detail. From my recollection, it's based on studies the authors have done. [1]: http://www.amazon.com/The-Millionaire-Next-Door-ebook/dp/B00CLT31D6/ref=sr_1_1?ie=UTF8&qid=1374668217&sr=8-1&keywords=millionaire+next+door http://www.amazon.com/The-Millionaire-Next-Door-ebook/dp/B00...
- jonnathanson 13y ago
  Lots of studies have demonstrated a "keeping up with the Joneses" effect, in which the happiness derived from status, income, wealth, or possessions is relative to the circles one inhabits. If I'm making $1M a year in a company full of people making $100k, I'll feel like a baller. If I'm making that same $1M in a company full of people making $10M+, I'll feel like a loser. It's the proximate context, not the universal one, to which people draw their emotional comparisons and assess their financial worth. Another well-studied effect is that lifestyle tends to rise to meet rising income levels. This is partially driven by the aforementioned effect -- rising income tends to put you in jobs, or in neighborhoods, or generally in physical proximity with other high earners -- and partially driven by the fact that you tend to develop more expensive tastes and habits as you climb the income ladder. I'm writing this from my iPad on the train, and so I am too lazy to tab over and look up the particular studies or sources. But start by Googling C.N. Parkinson -- the same Parkinson who famously quipped that work expands to meet the time available for its completion -- who stated that expenditures rise to meet income. Plenty of people have taken this observation and run with it in actual studies.
thibaut_barrere 13y ago
I've always been surprised to see people mention they want to start by changing the world. Such a mission is probably on top of the Maslow's hierarchy [1]. Starting first by making sure you can sustain your family seems more natural to me! Now I know that people went broke and miserable and also changed the world, but being happy feels like a achievement, too :-) [1] https://en.wikipedia.org/wiki/Maslow's_hierarchy_of_needs https://en.wikipedia.org/wiki/Maslow's_hierarchy_of_needs
- siddboots 13y ago
  Horses for courses, I suppose. "Changing the world" is just what some people want to do, even at the risk of poverty and misery. Maslow's hierarchy was never supposed to be a prescriptive account of how we ought to live.
  - thibaut_barrere 13y ago
    I do plan to change the world, actually. I'm only taking baby steps to it :-) I don't take the hierarchy as prescriptive either, I just noticed that it matched, mostly, my baby steps to change the world.
- Peer 13y ago
  Even if you want to sustain for your family now, a start up could possibly make it better for them in the future. That's a big problem with the Maslow's hierarchy, as it doesn't account for planning into the future.
  - thibaut_barrere 13y ago
    Do you mean you think that sustaining your family is mutually exclusive from doing a startup? If so, then I don't think so. I am running a bootstrapped startup (https://www.wisecashhq.com https://www.wisecashhq.com) and sustaining my family right now (and I expect, 99.9% sure, that the startup will make a better future for them, as well). This just requires picking a model where you can sustain your startup and your family, there's no need to dichotimize between both here. I didn't understand what you mean with "it doesn't account for planning into the future"? I do believe that securing resources, health and property does account for planning into the future, actually.
larsberg 13y ago
> the kinds of jobs that pay well also have a tendency to require complete focus. They consume your attention, your life. That's probably true at the seven-digit level, but most of my tech friends who are in finance work no more than a 9 hour day, 5 days a week. The only exception is Citadel, though this situation may be characteristic of the Chicago finance industry rather than NY, London, or Singapore. Several of my friends made the shift to that industry partially for the money but mainly to get off of the long hours and travel of consulting gigs, the gaming industry, and small companies.
- gadders 13y ago
  From banks I have worked in, I would say that is true 95% of the time, but if there is a time crunch (EG due to client commitments, regulatory deadline) they will expect you to work all the hours there are to deliver.
- deleted 13y ago
  [deleted]
lhnz 13y ago
It's not about money, it's about power. And I mean 'power' in the full sense of the word: the autonomy, money and status/connections to do what you want - whether that's changing the world, giving your family a good life (relative to their peers), or dating a supermodel. Money is just a proxy. Power is also just a proxy to happiness [0]. The power to make yourself happy. Concrete actions combine to give us access to abstract values which we position towards our purpose of reaching our favourite abstract concept "happiness." We often seek happiness as an end. But good advice might be to "Invest in lines, not dots." [0] We assume that if we can change things quickly we will be able to keep up with our hedonic treadmills. (The reality is that this won't work without control over our minds, since our desires can also upgrade quickly.)
- siddboots 13y ago
  And as a proxy to happiness, the buying power of the dollar varies from one person to the next. I agree with the author's advice, accepting that it was directed towards entrepreneurs. However, it's also perfectly fine to not desire more money than you already have.
stkni 13y ago
> There will come a point in life where you have enough money, hopefully. But if you're like most of my friends you'll also have two kids and a mortgage. At that point your appetite to take risks is reduced because it's not just about you any more. On the whole though I'd agree. The risk/reward profile of startups is pretty different to that of employment in a high paying industry. And I would be willing to bet that on average employment returns are higher than startup returns.
drrotmos 13y ago
Do people actually say that "A startup's purpose should be to change the world for the better in a meaningful way"? That's ridiculous, and symbolizes what's wrong with the current startup culture. Fine, go ahead and change the world for the better, but a startup is a business and the primary goal of a business is to turn a profit. If you can combine profit and world-changing, that's great, but don't forget the priorities. If that doesn't fit you, start a charity instead.
- samscully 13y ago
  If someone has changing the world as their primary goal, and they decide that a startup is the best path toward that goal, I don't really understand why they shouldn't do that? To me a startup is an amoral vehicle for achieving its founder's ends, so if they want to have changing the world as priority number one, and are satisfied with just breaking even, that is up to them (and similarly if turning a profit is top priority). Of course if it doesn't at least break even eventually, a startup is not really a useful tool for achieving anything.
  - drrotmos 13y ago
    To you, yes, but to the law and perhaps more importantly – to the relevant tax agency, a business is meant for turning a profit. If the founders aren't interested in turning a profit, a charity will serve them better.
    - sillysaurus 13y ago
      SpaceX's goal is to get to mars, not to turn a profit. And that's just one counterexample of hundreds.
    - samscully 13y ago
      IANAL, but as far as I understand a company director only has a 'duty to promote the success of the company' in the UK [1]. I think it is similar in the US. 'Success of the company' doesn't strictly have to mean making a profit, if the shareholders don't want it to. [1] http://www.taxresearch.org.uk/Blog/2013/01/07/companies-do-not-have-a-legal-duty-to-maximise-profit-or-to-avoid-tax/ http://www.taxresearch.org.uk/Blog/2013/01/07/companies-do-n...
michaelochurch 13y ago
The "change the world" rhetoric is posturing. It's a way of saying, "I'm so secure that I don't need to think about money". It's an aristocratic conceit. As an added benefit, it makes it easier to attract young, clueless talent and make it work 85-hour weeks. I know far too many people working for terrible startups on minimal wages because they "believe in the company". That's fine if you have real equity, but taking a $50,000 haircut for typical employee equity is insane. I hope people read this and absorb the message. If you're trying to hustle or build something the odds are already against, you can't afford to ignore "the making money part". To channel Mark Suster, ring the fucking cash register.
- wikiburner 13y ago
  You forgot to work in VC-istan™.
- jacques_chester 13y ago
  I think I am becoming trained to recognise you without seeing your name. It took me until "young, clueless talent" to flick my eyes up to see that yes, it was michealochurch. From the votes, I am apparently the only one.
- lectrick 13y ago
  The reason why wanting to change the world appears to be an "aristocratic conceit" is that the current reward system overly rewards predictable riskless delivery over unpredictable risky innovation, meaning that it is much harder to obtain the breathing room (read: cash) on both a personal and business level to go in those "world-changing" directions. Given that venture capital investment is one of the best (if riskiest) ways to make money, I really think it is time to throw out the accredited-investor law and open it up to everyone. This will flood the world with startup capital, allowing more breathing room for real innovation (read: world-changing) to occur. I agree that if no bottom line is made at all, you're in trouble. I can't find the post now, but there's a great blog post out there about realizing that you have to make yourself valuable to SOMEone, SOMEhow in a way that will make them pay you, whether you like it or not...
  - 13y ago
Peroni 13y ago
Great post. It's one thing to want to 'make a difference' but the vast majority of successful entrepreneurs set out to make their business as financially valuable as possible which is why exit strategies are crucial and prevalent. There really is nothing wrong with being money driven. Ultimately, it's hard for your business/startup/company/corporation to make any significant difference to anything if they aren't established as a financially valuable organisation.
marcosscriven 13y ago
Reading this I think I might qualify as the archetype referred to in the article. I spent 15 years working in investment banking IT - which obviously doesn't pay anything like the traders/senior management, but still probably 4 or 5 times more than might be average in London. Five years ago I felt this was a huge amount, but amazingly it's still only just enough to have a flat (not a house) in London. Like the OP said, I didn't really save a lot - a lot went into equity for a flat. I decided at 36 to just give the 'startup thing' a go a few month ago, and made http://www.fabfabbers.com http://www.fabfabbers.com - but while I don't think what I've made is all that great, for me its been much more of a formative experience. Seeing really for the first time what it's like not to have a job to go to every day, what it's like to people to have zero respect for what you're doing, what it's like trying to focus on a product rather than just being a techy. In summary, I'm with the OP on this - I think making money is a decent aim - not least because if people are willing to part with money for your product or service, then in many ways that's an undeniable indication that what you're providing is worthwhile (unless you're a power company ;-)
- gadders 13y ago
  Good luck - looks really cool. A friend of mine left IB to found this: http://trotify.com/ http://trotify.com/
krmmalik 13y ago
I literally went through the realisation that this is exactly what is wrong with me - about 5 days ago. Since then i've done some hard work in changing how I feel about money, and what money means to my life. I don't know if I'm there yet. If anyone has any advice for me, I'm all ears.
- rfnslyr 13y ago
  Anyone who says they are not in it for the money is lying. The underlying goal is always money, few admit it. If they truly wanted to do something not for the money, they'd be in their garage carving figurines not spending every breath maintaining a (probably) already dead startup.
  - thibaut_barrere 13y ago
    I personally really don't care about the money (no lying, I swear). I care, though, about the fact that money brings me time, and as such more freedom to do whatever I like. I do not know where you took that from... Most of the people (EU-based) I know that are bootstrapping their own (profitable, not dead) startup or service seem to be minded similarly, too. I just make sure I have enough money to not have to think about money, so it actually gets out of the way.
    - ken_railey 13y ago
      I personally really don't care about the money (no lying, I swear). I care, though, about the fact that money brings me time, and as such more freedom to do whatever I like. These two statements are contradictory. The whole point of having it is that it is stored value that can provide you with the things you actually need; time, in your case.
      - thibaut_barrere 13y ago
        I don't see it contradictory since my freedom and time is not solely brought by money; money is just one ingredient (in the middle of knowledge, confidence, etc etc). Similarly, I don't care much about H alone, but I definitely enjoy H2O!
lectrick 13y ago
Semantics matter here. I really wish the title of this was "Embrace the desire to be successful," because with success usually comes money, although I think the distinction is important. One is qualitative, one is quantitative.
msluyter 13y ago
There will come a point in life where you have enough money, hopefully. At that point, you probably should start ventures that aren't about making money (though money-making businesses are a very robust way to change the world). My theory is that this rarely actually happens. People rarely reach a point and think "ok, I have enough money now; I'll go work at a charity." Mostly due to the hedonic treadmill: http://en.wikipedia.org/wiki/Hedonic_treadmill http://en.wikipedia.org/wiki/Hedonic_treadmill This is actually empirically testable to some degree. I recall a recent study asking millionaires if they had enough money, and most of them said something like "no, I won't feel secure until I have 10-20 mil."
- ambiate 13y ago
  I would feel secure at 600,000 post-tax for a 15 year adventure into research for bioinformatics, analytics, and embedded design. During this 15 year break, I could easily notch away at the big circle of knowledge, generate side income, write books/tutorials and contribute to companies/individuals in software aspects. I would also be able to work at night. I have a reversed circadian rhythm. I spend most of my nights getting 2-4 hours of sleep and murmuring about math and programming during the other 4-6 hours. A typical job schedule holds back my productivity. My happiness is defined by obtaining/spreading knowledge. 40,000 (post-tax) a year is more than enough to maintain a household of three, take vacations, and stay on top of technology.
  - kayoone 13y ago
    Sorry for OT That doesnt sound healthy, you should reverse your reversed circadian rhythm. I dont buy that this is given to you and you cant change it. When i get up at 6 a couple of days in the row its hard at first but after a while it wake up at 6 without an alarm (provided i go to bet early enough). If i stay awake until 2 all the time, i wont get up before 9. Thats a habit and you can change it.
    - zimbatm 13y ago
      Why assume he's being irresponsible ? People generally have more knowledge about themselves than a random observer on the web.
griffordson 13y ago
I find the crowd that pooh-poohs lifestyle businesses while working for someone else particularly amusing. You are much more likely to accumulate real wealth with a lifestyle business that you own than you are working for someone else.
- kayoone 13y ago
  While true, its not given that you will ever exceed earnings of a reasonably well paying job.
  - griffordson 13y ago
    Sure, it is completely reasonable to stay in a well paying job to avoid the risk of losing money (and sanity since if you only make the same money in your own business you'll likely be much more stressed.) To be clear, I'm not criticizing anyone who makes that choice. I made that choice for a long time since I have a family to support. But I didn't make fun of entrepreneurs who weren't trying to boil the ocean. I've always found those who do that a source of amusement.
j45 13y ago
Great post. Before changing the world, change the world inside you and directly around you. One of the things that gets missed in "making money" is how a sliver of tech talent can solve such huge problems for the average person. PG hit the nail on the head in encouraging everyone to simply solving problems the average non-tech person has, whom are the majority. Solving your own problems has merit if your problems aren't rare, or can be a financial engine. It's an opportunity to grow beyond where too many techs are today... they simply don't see how many people are so passionate about what they do that they are willing to do the most unreasonable thing: calculate, track, and manage things by pen and paper, or whatever they can get in a spreadsheet. To me, when I see someone do something by hand, manually, because they're so passionate to get it done, or have no choice, it's a mirror to me. How the hell do my talents add value if others are stuck with what they're doing because no one is giving them any attention? Instead, we have techs justify what they're doing to be something grand and great to "make it up", or some how make life more worthwhile? Maybe, part of this is from an preference to relate to a keyboard instead of relating to others. Maybe its a part of maturity and starting to see one's self as part of a bigger whole. The need for an ability to shift lenses is critical, because hiding behind a keyboard is not ok anymore, the world has arrived on our doorsteps asking to solve problems with tech. Software can either make people's lives much harder or easier. Being on the right side of the equation, even if it's giving up a few hours a week just to solve anyone's problems with a script will uncover more opportunities for creating value (read: the right ones will be dying to pay you something to keep your attention). Ironically perhaps, most of all, is the fact that having a financial engine lets you drive and pursue more of the things you want with your time and by being able to pay for the time of others.
- griffordson 13y ago
  This is so true. Also, if you can solve a problem for one such customer in a reasonably sized niche you can earn recurring revenue by selling the same solution over and over again. And reasonably sized is probably much smaller than most people imagine.
  - j45 13y ago
    Absolutely. Almost any small business will pay $1-200/month (often more!) for anything that saves or makes them $500-2000/month in money. The key is being able to communicate and help them find and define the problem that can do this. Walking into any small business and saying "If I could save or make you anywhere between $500 and $2000 a month, would you be interested?" without a problem identified to solve finds more opportunities than anyone can imagine. The #1 cost in any business is labour, if you save people time, and create a business case of how many hours literally are saved per week, and how many dollars are printed. Learning to add and create value, however is at the root of not being able to make money, and understanding one's own value, genuinely and bringing that to a conversation is something that's always worth working on.
mindcrime 13y ago
I want to make a lot of money, and I'm not even slightly embarrassed by that. Why would I be? This is my life, and my dreams are at stake, and - last time I checked - you only get one shot (one life) at living your dreams. I'm not killing myself working 7 days a week, balancing a startup and a regular job, spending almost my every waking hour working in some fashion, forgoing vacations, a social life, a girlfriend, partying, etc. - all just for my health. In fact, my health is most likely suffering from this lifestyle. But when I look at the potential: building a profitable, growing company that could give me the financial freedom to live the rest of my life more "on my own terms"... having the freedom to travel to exotic locations, have fun adventures, engage in projects that just plain interest me (as opposed to having to be motivated by financial returns), etc... that makes it all seem worthwhile. It's not about money, it's about power. And I mean 'power' in the full sense of the word: the autonomy, money and status/connections to do what you want - whether that's changing the world, giving your family a good life (relative to their peers) It's basically what lhnz says: It's not really the money per-se that matters, it's the freedom that having plenty of money allows you, that matters. I'm not out to own a yacht, a private jet, or 7 mansions in 6 countries or anything... I don't need to be Larry Ellison rich, but I'd like to get to "FU money" level. That's not my only reason for trying to build a startup, but it's definitely one of them. or dating a supermodel I like the way you think! Preferably a 6' tall, redheaded supermodel with a Scottish accent. :-)
peterwwillis 13y ago
Compare yourself to the rest of the world, and you already have made lots of money. Congratulations! Now you can relax and just enjoy your life.
- swombat 13y ago
  Sorry, but I can't agree with that attitude, at least not from a motivational perspective. With that view, why bother coming down from the trees in the first place? The mindset you describe is good to make yourself happy, and useful in that context, but useless to make your life better (by any metric). I believe one can be both happy and have the ambition to continually make the world a better place through one's achievements.
  - peterwwillis 13y ago
    Happiness, fulfillment, and a 'better life' are all different concepts [though not mutually exclusive]. It's also all completely subjective, so whatever works for you is correct. I have no idea why we came down from the trees. It's quite nice up there.
mathattack 13y ago
Taking this too far can be painful. Would you rather be in a startup surrounded by mercenaries or idealists? Or someplace inbetween?
- swombat 13y ago
  You need both to have either. If your business lacks a purpose/mission, it will probably not make that much money. And if it lacks a clear and strong desire for money, it will probably not achieve any useful purpose, or at least not on any scale. Probably worth making that point separately in a later article. Thanks for bringing it up!
  - mathattack 13y ago
    That's what I was getting at. 100% mercenary doesn't work. (Or at least it's painful to have to count on mercenaries, even if you understand their motivation) Neither does 100% blind eyed idealism. It's finding the sweet spot in the middle, which varies by company and industry. Edit - And please keep writing!
_pmf_ 13y ago
Oh, I'm very much embracing this desire. The real problem is convincing other people to share my enthusiasm.
abelardx 13y ago
I totally agree that wanting to make money to provide a better life for yourself and family is very laudable. However, the article didn't mention the greatest creator of wealth in the world, which is compound interest and time. You don't have to do something big to have big money. Consistently saving over decades is how most people achieve financial security. For more than just security, the standard way to get rich is to start your own business. Even a small business, if it succeeds and lasts five years, should be a cash cow for life. The richest guy I know runs a single dog kennel, for example.
dylandrop 13y ago
Having been raised in a community in Los Angeles with extremely affluent people, I am highly skeptical of this article. From my experience, money leads to malaise and depression, and isn't a great end goal. There are plenty of miserable rich people -- and why? Because it isn't a good goal. You'll always strive to be richer. I think there are enough people striving to be rich in this world, and not enough people working to make it better. This is especially true of engineers. I find that most people I find trying to save the world are activists, while as an engineer, I know I can change the world in a very immediate and practical way. I'm fine with making a good $100k salary, I don't need to make $100 million to be happy. There's something to be said for a healthy balance between making a good salary, and doing something worth while. There are enough entrepreneurs just trying to get their social app to be sold to Google or Yahoo or Facebook. There are DEFINITELY not enough Engineers without Borders.
smartician 13y ago
It's hard to take an article seriously that has so many fallacies. For example, lifestyle is a choice. Whether you're bootstrapping your own start-up, or working as a highly paid employee, you freely choose how to spend your money. Lifestyle inflation may be real, but it's almost entirely avoidable. It's a matter of discipline. Secondly, the article is comparing the risk of losing an investment vs. the risk of losing a source of income. Very different things. If you invest countless hours and tens of thousands of dollars in a failed start-up, that is gone. Hundreds of thousand of dollars in opportunity cost down the drain. If you lose your job, what do you really lose? No, you get to keep all the money you earned so far, and chances are, you're even getting a nice severance package. And you go out and find another job within a few months at the most. Where's the "risk"? You're not putting anything on the line. I'm not saying that being employed is superior to starting your own business. It's just that this sounds more like self-justification, presenting a skewed picture.
xradionut 13y ago
95% of the people I've worked with or met in startups aren't financially better after the process. But most did leverage the experience to find better jobs/careers... As for money there are various sums of riches that lead to various life scenarios. At 6 million, I could take a few years off, switch careers and "retire" with a careful eye to expenses. At 10 million, no real job necessary beyond hobbies. At 40 million, I could really invest in projects I believe in and make big differences in many peoples lives. (I currently do assist people and contribute time and resources to various communities, but having serious capital would allow for economy of scale...) All said, I don't want money, I want the security and the leverage to do good for myself and others. No bling or bottle popping wanted...
umsm 13y ago
Is it just me, or am I missing the point of this article. I have yet to meet a person that is embarrassed to make money. Everyone wants and needs to make money, because without that fundamental goal, nothing else in the business or venture is possible.

123 points by swombat 13y ago

The one thing this country (I'm speaking here of the US) doesn't have any discernable lack of is massive herds of people who are desperate to make more money. Lots of it. Piles of it. Mountains of it. And right now. If there is a clear and unambiguous, nearly universal, practically uncontested value in this country it's to make more money. That's not necessarily bad, but it often is, and frequently has both bad personal and economic consequences. Of course it's not even clear what we're talking about since "making money" isn't really defined in the article, and the kinds of salaries that are easily within reach of, I would assert, most professional HN readers (who are programmers), are airily dismissed with the claim of heavy taxation (which are actually near historical lows), and the costs of "maintaining a certain lifestyle" which is more or less a personal choice. If you are a person living in NYC or SF and you make $125,000 a year, and are unable to max out your 401k AND save at least a grand a month, then you are making extremely poor decisions. Now, that may not be the kind of money the author has in mind, but it ain't bad, and you can lead a decent lifestyle and save at the same time without much effort. There is, I think, some small truth to the claim that there is more talk of changing the world in SV than at, say, Lehman Brothers, but I think it's slightly naive not to see that this is often a thin tissue over the desire to make money. Not too many people go into to business and don't want to make money and a lot of it if they can. Talk of changing the world is prevalent precisely because the current software revolution makes it astoundingly more likely that you can make money AND change the world. That's certainly not true if you start a bodega and probably not true if you start a hedge fund. But in software it is. Software companies are changing the world in ways that are both trivial and profound, and some of them are even making a boatload of money at it. I don't see a lack of people who want to make money anywhere. I see a set of people who recognize that they can potentially have an outsized impact on the world and make a lot of money because software makes this massively more likely than at any time in the past. It just seems to me that the author both assumes a problem that doesn't really exist, and proposes an answer to said problem that is presented as more sure and easier than it actually is. But anyway I think the confusion is because we shift from getting rich at the beginning to "make enough money to be comfortable" at the end, so it's slightly confused: it's not about all out self-interested greediness he tells us, except at the end it is. And the social consequences of that mindset are just conveniently ignored. In the end there just doesn't have to be strong competition between the desire to make money and the desire to also do decent things in the world. It only seems that way when one of those desires (the first one) is grossly out of whack.

jakejake 13y ago
I think the author is talking about a very tiny bubble of, not just Silicon Valley, but also further limited to recent grads who are still living the college life and just starting companies. If you limit your world view to that group then I'm sure it seems like everybody is in it to change the world, and a goal of making money is not noble. I'm not a part of that group, so I don't really see that at all. Nobody that I personally know has any problem with making money. Not that we're all chasing money either, just that there's certainly no conflicting feelings going on.

davidw 13y ago

In general, a great point - it's something I should have thought about more, earlier when I was more of a head-in-the-clouds aspiring hacker. One detail, though: > somehow, many if not most people working in these high-wage jobs don't accumulate all that much money. This sounds plausible, but I'd prefer to see it backed up by statistics.

thibaut_barrere 13y ago
I don't have a bookmark unfortunately, but I read first hand a couple of years ago a study mentioning that employees did spend more and more as their wages went up (ultimately leading to golden handcuffs).
- cpursley 13y ago
  It's called lifestyle inflation.
  - thibaut_barrere 13y ago
    Great, thanks - I never saw that term before.
edanm 13y ago
The book "The Millionaire Next Door" [1] talks about this in quite a lot of detail. From my recollection, it's based on studies the authors have done. [1]: http://www.amazon.com/The-Millionaire-Next-Door-ebook/dp/B00CLT31D6/ref=sr_1_1?ie=UTF8&qid=1374668217&sr=8-1&keywords=millionaire+next+door http://www.amazon.com/The-Millionaire-Next-Door-ebook/dp/B00...
jonnathanson 13y ago
Lots of studies have demonstrated a "keeping up with the Joneses" effect, in which the happiness derived from status, income, wealth, or possessions is relative to the circles one inhabits. If I'm making $1M a year in a company full of people making $100k, I'll feel like a baller. If I'm making that same $1M in a company full of people making $10M+, I'll feel like a loser. It's the proximate context, not the universal one, to which people draw their emotional comparisons and assess their financial worth. Another well-studied effect is that lifestyle tends to rise to meet rising income levels. This is partially driven by the aforementioned effect -- rising income tends to put you in jobs, or in neighborhoods, or generally in physical proximity with other high earners -- and partially driven by the fact that you tend to develop more expensive tastes and habits as you climb the income ladder. I'm writing this from my iPad on the train, and so I am too lazy to tab over and look up the particular studies or sources. But start by Googling C.N. Parkinson -- the same Parkinson who famously quipped that work expands to meet the time available for its completion -- who stated that expenditures rise to meet income. Plenty of people have taken this observation and run with it in actual studies.

thibaut_barrere 13y ago

I've always been surprised to see people mention they want to start by changing the world. Such a mission is probably on top of the Maslow's hierarchy [1]. Starting first by making sure you can sustain your family seems more natural to me! Now I know that people went broke and miserable and also changed the world, but being happy feels like a achievement, too :-) [1] https://en.wikipedia.org/wiki/Maslow's_hierarchy_of_needs https://en.wikipedia.org/wiki/Maslow's_hierarchy_of_needs

siddboots 13y ago
Horses for courses, I suppose. "Changing the world" is just what some people want to do, even at the risk of poverty and misery. Maslow's hierarchy was never supposed to be a prescriptive account of how we ought to live.
- thibaut_barrere 13y ago
  I do plan to change the world, actually. I'm only taking baby steps to it :-) I don't take the hierarchy as prescriptive either, I just noticed that it matched, mostly, my baby steps to change the world.
Peer 13y ago
Even if you want to sustain for your family now, a start up could possibly make it better for them in the future. That's a big problem with the Maslow's hierarchy, as it doesn't account for planning into the future.
- thibaut_barrere 13y ago
  Do you mean you think that sustaining your family is mutually exclusive from doing a startup? If so, then I don't think so. I am running a bootstrapped startup (https://www.wisecashhq.com https://www.wisecashhq.com) and sustaining my family right now (and I expect, 99.9% sure, that the startup will make a better future for them, as well). This just requires picking a model where you can sustain your startup and your family, there's no need to dichotimize between both here. I didn't understand what you mean with "it doesn't account for planning into the future"? I do believe that securing resources, health and property does account for planning into the future, actually.

larsberg 13y ago

> the kinds of jobs that pay well also have a tendency to require complete focus. They consume your attention, your life. That's probably true at the seven-digit level, but most of my tech friends who are in finance work no more than a 9 hour day, 5 days a week. The only exception is Citadel, though this situation may be characteristic of the Chicago finance industry rather than NY, London, or Singapore. Several of my friends made the shift to that industry partially for the money but mainly to get off of the long hours and travel of consulting gigs, the gaming industry, and small companies.

gadders 13y ago
From banks I have worked in, I would say that is true 95% of the time, but if there is a time crunch (EG due to client commitments, regulatory deadline) they will expect you to work all the hours there are to deliver.
deleted 13y ago
[deleted]

lhnz 13y ago

It's not about money, it's about power. And I mean 'power' in the full sense of the word: the autonomy, money and status/connections to do what you want - whether that's changing the world, giving your family a good life (relative to their peers), or dating a supermodel. Money is just a proxy. Power is also just a proxy to happiness [0]. The power to make yourself happy. Concrete actions combine to give us access to abstract values which we position towards our purpose of reaching our favourite abstract concept "happiness." We often seek happiness as an end. But good advice might be to "Invest in lines, not dots." [0] We assume that if we can change things quickly we will be able to keep up with our hedonic treadmills. (The reality is that this won't work without control over our minds, since our desires can also upgrade quickly.)

siddboots 13y ago
And as a proxy to happiness, the buying power of the dollar varies from one person to the next. I agree with the author's advice, accepting that it was directed towards entrepreneurs. However, it's also perfectly fine to not desire more money than you already have.

stkni 13y ago

> There will come a point in life where you have enough money, hopefully. But if you're like most of my friends you'll also have two kids and a mortgage. At that point your appetite to take risks is reduced because it's not just about you any more. On the whole though I'd agree. The risk/reward profile of startups is pretty different to that of employment in a high paying industry. And I would be willing to bet that on average employment returns are higher than startup returns.

drrotmos 13y ago

Do people actually say that "A startup's purpose should be to change the world for the better in a meaningful way"? That's ridiculous, and symbolizes what's wrong with the current startup culture. Fine, go ahead and change the world for the better, but a startup is a business and the primary goal of a business is to turn a profit. If you can combine profit and world-changing, that's great, but don't forget the priorities. If that doesn't fit you, start a charity instead.

samscully 13y ago
If someone has changing the world as their primary goal, and they decide that a startup is the best path toward that goal, I don't really understand why they shouldn't do that? To me a startup is an amoral vehicle for achieving its founder's ends, so if they want to have changing the world as priority number one, and are satisfied with just breaking even, that is up to them (and similarly if turning a profit is top priority). Of course if it doesn't at least break even eventually, a startup is not really a useful tool for achieving anything.
- drrotmos 13y ago
  To you, yes, but to the law and perhaps more importantly – to the relevant tax agency, a business is meant for turning a profit. If the founders aren't interested in turning a profit, a charity will serve them better.
  - sillysaurus 13y ago
    SpaceX's goal is to get to mars, not to turn a profit. And that's just one counterexample of hundreds.
  - samscully 13y ago
    IANAL, but as far as I understand a company director only has a 'duty to promote the success of the company' in the UK [1]. I think it is similar in the US. 'Success of the company' doesn't strictly have to mean making a profit, if the shareholders don't want it to. [1] http://www.taxresearch.org.uk/Blog/2013/01/07/companies-do-not-have-a-legal-duty-to-maximise-profit-or-to-avoid-tax/ http://www.taxresearch.org.uk/Blog/2013/01/07/companies-do-n...

michaelochurch 13y ago

The "change the world" rhetoric is posturing. It's a way of saying, "I'm so secure that I don't need to think about money". It's an aristocratic conceit. As an added benefit, it makes it easier to attract young, clueless talent and make it work 85-hour weeks. I know far too many people working for terrible startups on minimal wages because they "believe in the company". That's fine if you have real equity, but taking a $50,000 haircut for typical employee equity is insane. I hope people read this and absorb the message. If you're trying to hustle or build something the odds are already against, you can't afford to ignore "the making money part". To channel Mark Suster, ring the fucking cash register.

wikiburner 13y ago
You forgot to work in VC-istan™.
jacques_chester 13y ago
I think I am becoming trained to recognise you without seeing your name. It took me until "young, clueless talent" to flick my eyes up to see that yes, it was michealochurch. From the votes, I am apparently the only one.
lectrick 13y ago
The reason why wanting to change the world appears to be an "aristocratic conceit" is that the current reward system overly rewards predictable riskless delivery over unpredictable risky innovation, meaning that it is much harder to obtain the breathing room (read: cash) on both a personal and business level to go in those "world-changing" directions. Given that venture capital investment is one of the best (if riskiest) ways to make money, I really think it is time to throw out the accredited-investor law and open it up to everyone. This will flood the world with startup capital, allowing more breathing room for real innovation (read: world-changing) to occur. I agree that if no bottom line is made at all, you're in trouble. I can't find the post now, but there's a great blog post out there about realizing that you have to make yourself valuable to SOMEone, SOMEhow in a way that will make them pay you, whether you like it or not...
- 13y ago

Peroni 13y ago

Great post. It's one thing to want to 'make a difference' but the vast majority of successful entrepreneurs set out to make their business as financially valuable as possible which is why exit strategies are crucial and prevalent. There really is nothing wrong with being money driven. Ultimately, it's hard for your business/startup/company/corporation to make any significant difference to anything if they aren't established as a financially valuable organisation.

marcosscriven 13y ago

Reading this I think I might qualify as the archetype referred to in the article. I spent 15 years working in investment banking IT - which obviously doesn't pay anything like the traders/senior management, but still probably 4 or 5 times more than might be average in London. Five years ago I felt this was a huge amount, but amazingly it's still only just enough to have a flat (not a house) in London. Like the OP said, I didn't really save a lot - a lot went into equity for a flat. I decided at 36 to just give the 'startup thing' a go a few month ago, and made http://www.fabfabbers.com http://www.fabfabbers.com - but while I don't think what I've made is all that great, for me its been much more of a formative experience. Seeing really for the first time what it's like not to have a job to go to every day, what it's like to people to have zero respect for what you're doing, what it's like trying to focus on a product rather than just being a techy. In summary, I'm with the OP on this - I think making money is a decent aim - not least because if people are willing to part with money for your product or service, then in many ways that's an undeniable indication that what you're providing is worthwhile (unless you're a power company ;-)

gadders 13y ago
Good luck - looks really cool. A friend of mine left IB to found this: http://trotify.com/ http://trotify.com/

krmmalik 13y ago

I literally went through the realisation that this is exactly what is wrong with me - about 5 days ago. Since then i've done some hard work in changing how I feel about money, and what money means to my life. I don't know if I'm there yet. If anyone has any advice for me, I'm all ears.

rfnslyr 13y ago
Anyone who says they are not in it for the money is lying. The underlying goal is always money, few admit it. If they truly wanted to do something not for the money, they'd be in their garage carving figurines not spending every breath maintaining a (probably) already dead startup.
- thibaut_barrere 13y ago
  I personally really don't care about the money (no lying, I swear). I care, though, about the fact that money brings me time, and as such more freedom to do whatever I like. I do not know where you took that from... Most of the people (EU-based) I know that are bootstrapping their own (profitable, not dead) startup or service seem to be minded similarly, too. I just make sure I have enough money to not have to think about money, so it actually gets out of the way.
  - ken_railey 13y ago
    I personally really don't care about the money (no lying, I swear). I care, though, about the fact that money brings me time, and as such more freedom to do whatever I like. These two statements are contradictory. The whole point of having it is that it is stored value that can provide you with the things you actually need; time, in your case.
    - thibaut_barrere 13y ago
      I don't see it contradictory since my freedom and time is not solely brought by money; money is just one ingredient (in the middle of knowledge, confidence, etc etc). Similarly, I don't care much about H alone, but I definitely enjoy H2O!

lectrick 13y ago

Semantics matter here. I really wish the title of this was "Embrace the desire to be successful," because with success usually comes money, although I think the distinction is important. One is qualitative, one is quantitative.

msluyter 13y ago

There will come a point in life where you have enough money, hopefully. At that point, you probably should start ventures that aren't about making money (though money-making businesses are a very robust way to change the world). My theory is that this rarely actually happens. People rarely reach a point and think "ok, I have enough money now; I'll go work at a charity." Mostly due to the hedonic treadmill: http://en.wikipedia.org/wiki/Hedonic_treadmill http://en.wikipedia.org/wiki/Hedonic_treadmill This is actually empirically testable to some degree. I recall a recent study asking millionaires if they had enough money, and most of them said something like "no, I won't feel secure until I have 10-20 mil."

ambiate 13y ago
I would feel secure at 600,000 post-tax for a 15 year adventure into research for bioinformatics, analytics, and embedded design. During this 15 year break, I could easily notch away at the big circle of knowledge, generate side income, write books/tutorials and contribute to companies/individuals in software aspects. I would also be able to work at night. I have a reversed circadian rhythm. I spend most of my nights getting 2-4 hours of sleep and murmuring about math and programming during the other 4-6 hours. A typical job schedule holds back my productivity. My happiness is defined by obtaining/spreading knowledge. 40,000 (post-tax) a year is more than enough to maintain a household of three, take vacations, and stay on top of technology.
- kayoone 13y ago
  Sorry for OT That doesnt sound healthy, you should reverse your reversed circadian rhythm. I dont buy that this is given to you and you cant change it. When i get up at 6 a couple of days in the row its hard at first but after a while it wake up at 6 without an alarm (provided i go to bet early enough). If i stay awake until 2 all the time, i wont get up before 9. Thats a habit and you can change it.
  - zimbatm 13y ago
    Why assume he's being irresponsible ? People generally have more knowledge about themselves than a random observer on the web.

griffordson 13y ago

I find the crowd that pooh-poohs lifestyle businesses while working for someone else particularly amusing. You are much more likely to accumulate real wealth with a lifestyle business that you own than you are working for someone else.

kayoone 13y ago
While true, its not given that you will ever exceed earnings of a reasonably well paying job.
- griffordson 13y ago
  Sure, it is completely reasonable to stay in a well paying job to avoid the risk of losing money (and sanity since if you only make the same money in your own business you'll likely be much more stressed.) To be clear, I'm not criticizing anyone who makes that choice. I made that choice for a long time since I have a family to support. But I didn't make fun of entrepreneurs who weren't trying to boil the ocean. I've always found those who do that a source of amusement.

j45 13y ago

Great post. Before changing the world, change the world inside you and directly around you. One of the things that gets missed in "making money" is how a sliver of tech talent can solve such huge problems for the average person. PG hit the nail on the head in encouraging everyone to simply solving problems the average non-tech person has, whom are the majority. Solving your own problems has merit if your problems aren't rare, or can be a financial engine. It's an opportunity to grow beyond where too many techs are today... they simply don't see how many people are so passionate about what they do that they are willing to do the most unreasonable thing: calculate, track, and manage things by pen and paper, or whatever they can get in a spreadsheet. To me, when I see someone do something by hand, manually, because they're so passionate to get it done, or have no choice, it's a mirror to me. How the hell do my talents add value if others are stuck with what they're doing because no one is giving them any attention? Instead, we have techs justify what they're doing to be something grand and great to "make it up", or some how make life more worthwhile? Maybe, part of this is from an preference to relate to a keyboard instead of relating to others. Maybe its a part of maturity and starting to see one's self as part of a bigger whole. The need for an ability to shift lenses is critical, because hiding behind a keyboard is not ok anymore, the world has arrived on our doorsteps asking to solve problems with tech. Software can either make people's lives much harder or easier. Being on the right side of the equation, even if it's giving up a few hours a week just to solve anyone's problems with a script will uncover more opportunities for creating value (read: the right ones will be dying to pay you something to keep your attention). Ironically perhaps, most of all, is the fact that having a financial engine lets you drive and pursue more of the things you want with your time and by being able to pay for the time of others.

griffordson 13y ago
This is so true. Also, if you can solve a problem for one such customer in a reasonably sized niche you can earn recurring revenue by selling the same solution over and over again. And reasonably sized is probably much smaller than most people imagine.
- j45 13y ago
  Absolutely. Almost any small business will pay $1-200/month (often more!) for anything that saves or makes them $500-2000/month in money. The key is being able to communicate and help them find and define the problem that can do this. Walking into any small business and saying "If I could save or make you anywhere between $500 and $2000 a month, would you be interested?" without a problem identified to solve finds more opportunities than anyone can imagine. The #1 cost in any business is labour, if you save people time, and create a business case of how many hours literally are saved per week, and how many dollars are printed. Learning to add and create value, however is at the root of not being able to make money, and understanding one's own value, genuinely and bringing that to a conversation is something that's always worth working on.

mindcrime 13y ago

I want to make a lot of money, and I'm not even slightly embarrassed by that. Why would I be? This is my life, and my dreams are at stake, and - last time I checked - you only get one shot (one life) at living your dreams. I'm not killing myself working 7 days a week, balancing a startup and a regular job, spending almost my every waking hour working in some fashion, forgoing vacations, a social life, a girlfriend, partying, etc. - all just for my health. In fact, my health is most likely suffering from this lifestyle. But when I look at the potential: building a profitable, growing company that could give me the financial freedom to live the rest of my life more "on my own terms"... having the freedom to travel to exotic locations, have fun adventures, engage in projects that just plain interest me (as opposed to having to be motivated by financial returns), etc... that makes it all seem worthwhile. It's not about money, it's about power. And I mean 'power' in the full sense of the word: the autonomy, money and status/connections to do what you want - whether that's changing the world, giving your family a good life (relative to their peers) It's basically what lhnz says: It's not really the money per-se that matters, it's the freedom that having plenty of money allows you, that matters. I'm not out to own a yacht, a private jet, or 7 mansions in 6 countries or anything... I don't need to be Larry Ellison rich, but I'd like to get to "FU money" level. That's not my only reason for trying to build a startup, but it's definitely one of them. or dating a supermodel I like the way you think! Preferably a 6' tall, redheaded supermodel with a Scottish accent. :-)

peterwwillis 13y ago

Compare yourself to the rest of the world, and you already have made lots of money. Congratulations! Now you can relax and just enjoy your life.

swombat 13y ago
Sorry, but I can't agree with that attitude, at least not from a motivational perspective. With that view, why bother coming down from the trees in the first place? The mindset you describe is good to make yourself happy, and useful in that context, but useless to make your life better (by any metric). I believe one can be both happy and have the ambition to continually make the world a better place through one's achievements.
- peterwwillis 13y ago
  Happiness, fulfillment, and a 'better life' are all different concepts [though not mutually exclusive]. It's also all completely subjective, so whatever works for you is correct. I have no idea why we came down from the trees. It's quite nice up there.

mathattack 13y ago

Taking this too far can be painful. Would you rather be in a startup surrounded by mercenaries or idealists? Or someplace inbetween?

swombat 13y ago
You need both to have either. If your business lacks a purpose/mission, it will probably not make that much money. And if it lacks a clear and strong desire for money, it will probably not achieve any useful purpose, or at least not on any scale. Probably worth making that point separately in a later article. Thanks for bringing it up!
- mathattack 13y ago
  That's what I was getting at. 100% mercenary doesn't work. (Or at least it's painful to have to count on mercenaries, even if you understand their motivation) Neither does 100% blind eyed idealism. It's finding the sweet spot in the middle, which varies by company and industry. Edit - And please keep writing!

_pmf_ 13y ago

Oh, I'm very much embracing this desire. The real problem is convincing other people to share my enthusiasm.

abelardx 13y ago

I totally agree that wanting to make money to provide a better life for yourself and family is very laudable. However, the article didn't mention the greatest creator of wealth in the world, which is compound interest and time. You don't have to do something big to have big money. Consistently saving over decades is how most people achieve financial security. For more than just security, the standard way to get rich is to start your own business. Even a small business, if it succeeds and lasts five years, should be a cash cow for life. The richest guy I know runs a single dog kennel, for example.

dylandrop 13y ago

Having been raised in a community in Los Angeles with extremely affluent people, I am highly skeptical of this article. From my experience, money leads to malaise and depression, and isn't a great end goal. There are plenty of miserable rich people -- and why? Because it isn't a good goal. You'll always strive to be richer. I think there are enough people striving to be rich in this world, and not enough people working to make it better. This is especially true of engineers. I find that most people I find trying to save the world are activists, while as an engineer, I know I can change the world in a very immediate and practical way. I'm fine with making a good $100k salary, I don't need to make $100 million to be happy. There's something to be said for a healthy balance between making a good salary, and doing something worth while. There are enough entrepreneurs just trying to get their social app to be sold to Google or Yahoo or Facebook. There are DEFINITELY not enough Engineers without Borders.

smartician 13y ago

It's hard to take an article seriously that has so many fallacies. For example, lifestyle is a choice. Whether you're bootstrapping your own start-up, or working as a highly paid employee, you freely choose how to spend your money. Lifestyle inflation may be real, but it's almost entirely avoidable. It's a matter of discipline. Secondly, the article is comparing the risk of losing an investment vs. the risk of losing a source of income. Very different things. If you invest countless hours and tens of thousands of dollars in a failed start-up, that is gone. Hundreds of thousand of dollars in opportunity cost down the drain. If you lose your job, what do you really lose? No, you get to keep all the money you earned so far, and chances are, you're even getting a nice severance package. And you go out and find another job within a few months at the most. Where's the "risk"? You're not putting anything on the line. I'm not saying that being employed is superior to starting your own business. It's just that this sounds more like self-justification, presenting a skewed picture.

xradionut 13y ago

95% of the people I've worked with or met in startups aren't financially better after the process. But most did leverage the experience to find better jobs/careers... As for money there are various sums of riches that lead to various life scenarios. At 6 million, I could take a few years off, switch careers and "retire" with a careful eye to expenses. At 10 million, no real job necessary beyond hobbies. At 40 million, I could really invest in projects I believe in and make big differences in many peoples lives. (I currently do assist people and contribute time and resources to various communities, but having serious capital would allow for economy of scale...) All said, I don't want money, I want the security and the leverage to do good for myself and others. No bling or bottle popping wanted...

umsm 13y ago

Is it just me, or am I missing the point of this article. I have yet to meet a person that is embarrassed to make money. Everyone wants and needs to make money, because without that fundamental goal, nothing else in the business or venture is possible.