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it seems like a very well optimised system that bonds rich investors with already affluent students to generate money for themselves and other already rich peop

it seems like a very well optimised system that bonds rich investors with already affluent students to generate money for themselves and other already rich people in rich countries. This is a good first-order approximation. One generally admirable thing about American culture is that it's not acceptable to just inherit wealth and try to rule society. Where this backfires is that it means that rich kids get dumped into the mainstream labor market and, with their superior social resources, take most of the top jobs. VC-funded startups are mostly a mechanism for taking parental wealth and influence (a socially unacceptable thing for the child to live off of) and laundering it into shares of newly-created businesses, so that the sponsee looks like a genuine tech entrepreneur rather than the beneficiary of a managed outcome (acqui-hire!) put together by his parents' friends. There is a lot of technology work, even right now, that improves peoples' lives in immensely meaningful ways. Perhaps the people doing such work are a "silent majority" of technology. The problem is that you never hear about it on Hacker News or TechCrunch, and the contemporary crowd of Valley king-makers runs away from it. If something is worth doing, it's usually hard to do and even harder to control. If several of the constraints are socioeconomic arrangements (e.g. Joffrey must get at least $10M and a VP-level position in the inevitable acqui-hire; and we must let Squabbling Hen Capital in on this deal, with a board seat, because we owe them a favor) then it becomes a lot harder to actually do anything useful. Instead, it becomes "tech is hard, let's go Snapchat".

econner 11y ago
I agree with your point that you don't read about the "silent majority" on Hacker News and TechCrunch. Consumer internet touches more people's lives so you hear about it more, especially when said founders are 22 and straight out of school. It's a story the media likes to tell. Google, Cisco, Kiva, HP, Sun Microsystems, Theranos, Yahoo, Trulia, StubHub, Lytro, Coursera, Bonobos, Snapchat, and Instagram came out of Stanford in one way or another. These companies showcase a diverse range of tech that IS useful. It's unfair too to say that social media doesn't do anything useful. Facebook reports 1.4 billion MAUs and works to bring the internet to more and more corners of the world. Snapchat's social component has given it the platform on which to innovate. True, many Stanford students are already wealthy. True, there's a recent trend toward social media companies. But, Stanford continues to be a place where students work incredibly hard and remain motivated to do impactful work. Stanford has a storied history of entrepreneurship that begins before Snapchat and will continue after it.
- Retric 11y ago
  Sure there are outliers, but if Snapchat makes your short list of 'useful' innovation I think you lost the argument.
  - SamReidHughes 11y ago
    There are 11 other companies in that list, so no, disagreeing with regard to one company should not affect your reception of the argument.
    - Retric 11y ago
      Personally Trulia, StubHub, Coursera, Bonobos, Snapchat, and Instagram also fail to make the useful innovation cut. If 20+ companies do the same thing and 1 one them wins that does not mean the winner is 'innovative'. lytro is actually innovative. It might not be successful, but again that's a seperate category.
      - tptacek 11y ago
        I decided I hate this comment and zorched it.
        deleted 11y ago
        [deleted]
        deleted 11y ago
        [deleted]
        Retric 11y ago
        Why? Linux was increadably well managed and great software, but not nessisarily innovative at the outset. Android is arguably much worse as software, but innovative both as a project and somewhat less so as a phone OS. Sure, you can argue that every piece of software is 'new' and thus innovative, but IMO that's a somewhat meaninglessly low bar.
SamReidHughes 11y ago
> VC-funded startups are mostly a mechanism for taking parental wealth and influence (a socially unacceptable thing for the child to live off of) and laundering it into shares of newly-created businesses, so that the sponsee looks like a genuine tech entrepreneur rather than the beneficiary of a managed outcome (acqui-hire!) put together by his parents' friends. By "mostly," to what greater-than-50% degree to which they are this sort of mechanism do you have in mind? Are founders of greater than 50% of startups actually children of people that work at VC firms? (In actual reality, they aren't.) > There is a lot of technology work, even right now, that improves peoples' lives in immensely meaningful ways. Perhaps the people doing such work are a "silent majority" of technology. The problem is that you never hear about it on Hacker News or TechCrunch, and the contemporary crowd of Valley king-makers runs away from it. This is completely false because we hear about technology improving people's lives all the time here, and usually when I see anything about snapchat or Valley kings it's because you decided to talk about it. > If something is worth doing, it's usually hard to do and even harder to control. Well uh, that's a nice premise, but it's actually often easy to do things that are worth doing. Especially when there's a new untapped market. > If several of the constraints are socioeconomic arrangements (e.g. Joffrey must get at least $10M and a VP-level position in the inevitable acqui-hire; and we must let Squabbling Hen Capital in on this deal, with a board seat, because we owe them a favor) then it becomes a lot harder to actually do anything useful. Instead, it becomes "tech is hard, let's go Snapchat". Which VP-level positions at Snapchat are held by the sort of people you refer to?
- deleted 11y ago
  [deleted]
robotresearcher 11y ago
> One generally admirable thing about American culture is that it's not acceptable to just inherit wealth and try to rule society. How did you come to believe that? Most of the recent presidents and presidential candidates would tell against that theory. http://www.theguardian.com/world/2014/mar/11/george-p-bush-us-political-dynasties-kennedy-clinton-2016-presidential-election http://www.theguardian.com/world/2014/mar/11/george-p-bush-u...
dang 11y ago
> There is a lot of technology work [...] that improves peoples' lives in immensely meaningful ways. The problem is that you never hear about it on Hacker News. Why don't you post some articles about it, then? I believe this community would love nothing better than to learn about immensely meaningful technical work that they've never heard about. I know I would.
tptacek 11y ago
Can you provide a list of successful or long-term viable startups that you feel were the products of parental wealth transfer? Can you provide a single example of an acqui-hire that you believe --- with any evidence at all --- to have been the result of a favor to the parents of the founders of that company? I feel like I talk to a lot of people at VC-backed startups managing boards --- in addition to having founded such a company many moons ago --- and while I've heard a lot of horror stories, one story I've never heard is the one where a board seat was given away as quid-pro-quo. Can you help me understand your claim more clearly, for instance with an example?
- foobarqux 11y ago
  Chelsea Clinton, d'Alosio, Oscar Health, AppDirect, Microsoft.
  - tptacek 11y ago
    Of these, d'Alosio seems the closest to an example of what Church is talking about, and it's noteworthy in being noteworthy; an exception to prove the rule. I concede the point though, is what I should say.
  - wglb 11y ago
    In what way was Microsoft a result of parental wealth transfer?
    - foobarqux 11y ago
      Bill Gates received a large trust fund when he was born. Microsoft's first major deal, with IBM, was facilitated by his mother's connection to the IBM board.
      - wglb 11y ago
        But as I recall, the company had to pull its own weight financially, and was effectively bootstrapped.
- 11y ago

econner 11y ago

I agree with your point that you don't read about the "silent majority" on Hacker News and TechCrunch. Consumer internet touches more people's lives so you hear about it more, especially when said founders are 22 and straight out of school. It's a story the media likes to tell. Google, Cisco, Kiva, HP, Sun Microsystems, Theranos, Yahoo, Trulia, StubHub, Lytro, Coursera, Bonobos, Snapchat, and Instagram came out of Stanford in one way or another. These companies showcase a diverse range of tech that IS useful. It's unfair too to say that social media doesn't do anything useful. Facebook reports 1.4 billion MAUs and works to bring the internet to more and more corners of the world. Snapchat's social component has given it the platform on which to innovate. True, many Stanford students are already wealthy. True, there's a recent trend toward social media companies. But, Stanford continues to be a place where students work incredibly hard and remain motivated to do impactful work. Stanford has a storied history of entrepreneurship that begins before Snapchat and will continue after it.

Retric 11y ago
Sure there are outliers, but if Snapchat makes your short list of 'useful' innovation I think you lost the argument.
- SamReidHughes 11y ago
  There are 11 other companies in that list, so no, disagreeing with regard to one company should not affect your reception of the argument.
  - Retric 11y ago
    Personally Trulia, StubHub, Coursera, Bonobos, Snapchat, and Instagram also fail to make the useful innovation cut. If 20+ companies do the same thing and 1 one them wins that does not mean the winner is 'innovative'. lytro is actually innovative. It might not be successful, but again that's a seperate category.
    - tptacek 11y ago
      I decided I hate this comment and zorched it.
      - deleted 11y ago
        [deleted]
        deleted 11y ago
        [deleted]
      - Retric 11y ago
        Why? Linux was increadably well managed and great software, but not nessisarily innovative at the outset. Android is arguably much worse as software, but innovative both as a project and somewhat less so as a phone OS. Sure, you can argue that every piece of software is 'new' and thus innovative, but IMO that's a somewhat meaninglessly low bar.

SamReidHughes 11y ago

> VC-funded startups are mostly a mechanism for taking parental wealth and influence (a socially unacceptable thing for the child to live off of) and laundering it into shares of newly-created businesses, so that the sponsee looks like a genuine tech entrepreneur rather than the beneficiary of a managed outcome (acqui-hire!) put together by his parents' friends. By "mostly," to what greater-than-50% degree to which they are this sort of mechanism do you have in mind? Are founders of greater than 50% of startups actually children of people that work at VC firms? (In actual reality, they aren't.) > There is a lot of technology work, even right now, that improves peoples' lives in immensely meaningful ways. Perhaps the people doing such work are a "silent majority" of technology. The problem is that you never hear about it on Hacker News or TechCrunch, and the contemporary crowd of Valley king-makers runs away from it. This is completely false because we hear about technology improving people's lives all the time here, and usually when I see anything about snapchat or Valley kings it's because you decided to talk about it. > If something is worth doing, it's usually hard to do and even harder to control. Well uh, that's a nice premise, but it's actually often easy to do things that are worth doing. Especially when there's a new untapped market. > If several of the constraints are socioeconomic arrangements (e.g. Joffrey must get at least $10M and a VP-level position in the inevitable acqui-hire; and we must let Squabbling Hen Capital in on this deal, with a board seat, because we owe them a favor) then it becomes a lot harder to actually do anything useful. Instead, it becomes "tech is hard, let's go Snapchat". Which VP-level positions at Snapchat are held by the sort of people you refer to?

deleted 11y ago
[deleted]

robotresearcher 11y ago

> One generally admirable thing about American culture is that it's not acceptable to just inherit wealth and try to rule society. How did you come to believe that? Most of the recent presidents and presidential candidates would tell against that theory. http://www.theguardian.com/world/2014/mar/11/george-p-bush-us-political-dynasties-kennedy-clinton-2016-presidential-election http://www.theguardian.com/world/2014/mar/11/george-p-bush-u...

dang 11y ago

> There is a lot of technology work [...] that improves peoples' lives in immensely meaningful ways. The problem is that you never hear about it on Hacker News. Why don't you post some articles about it, then? I believe this community would love nothing better than to learn about immensely meaningful technical work that they've never heard about. I know I would.

tptacek 11y ago

Can you provide a list of successful or long-term viable startups that you feel were the products of parental wealth transfer? Can you provide a single example of an acqui-hire that you believe --- with any evidence at all --- to have been the result of a favor to the parents of the founders of that company? I feel like I talk to a lot of people at VC-backed startups managing boards --- in addition to having founded such a company many moons ago --- and while I've heard a lot of horror stories, one story I've never heard is the one where a board seat was given away as quid-pro-quo. Can you help me understand your claim more clearly, for instance with an example?

foobarqux 11y ago
Chelsea Clinton, d'Alosio, Oscar Health, AppDirect, Microsoft.
- tptacek 11y ago
  Of these, d'Alosio seems the closest to an example of what Church is talking about, and it's noteworthy in being noteworthy; an exception to prove the rule. I concede the point though, is what I should say.
- wglb 11y ago
  In what way was Microsoft a result of parental wealth transfer?
  - foobarqux 11y ago
    Bill Gates received a large trust fund when he was born. Microsoft's first major deal, with IBM, was facilitated by his mother's connection to the IBM board.
    - wglb 11y ago
      But as I recall, the company had to pull its own weight financially, and was effectively bootstrapped.
11y ago