Opinion

Felix Salmon

The most expensive lottery ticket in the world

By Felix Salmon
April 21, 2014

No Exit, the new book from Gideon Lewis-Kraus, should be required reading for anybody who thinks it might be a good idea to found a startup in Silicon Valley. It shows just how miserable the startup founder’s life is, and raises the question of why anybody would voluntarily subject themselves to such a thing.

A large part of the answer is that Silicon Valley is gripped by a mass delusion, compounded by a deep “fake it til you make it” attitude toward success. Why do so many people in Silicon Valley want to be founders? Because every founder they meet is always killing it, crushing it, having massive success, just about to close a huge round, etc etc. At some level, they must know this is impossible: if 90% of startups fail, it simply can’t be the case that all of the startups they know are succeeding. After all, failure is not something which just suddenly happens overnight, when you thought you were doing great all along. But people tend to believe the evidence of their own eyes, and what they see is a combination of two things: the founders they know all seemingly doing great, and also a steady stream of headlines showing other founders cashing out for millions or even billions of dollars.

On top of that, startup founders have Silicon Valley cachet: they’re the stuff of legend. Everybody wants to be Mark Zuckerberg or Steve Jobs or Jack Dorsey. There might be a generous paycheck in getting stuck on the Google bus for the next decade, but there sure ain’t any glory in it. And so a huge number of incredibly well qualified engineers, who in previous decades would have put their skills to work being a part of something much bigger than themselves, instead decide to go it alone.

There is no reason whatsoever to believe that computer engineers make particularly good entrepreneurs. Quite the opposite, in fact: engineers tend to do quite well in structured environments, where there are clear problems to solve, and relatively badly in the chaos of a startup, where the most important skills are non-engineering ones, like being able to attract talent and investors. No Exit makes it very clear that the life of a startup founder is a miserable one, and that engineers are invariably happier when they’re working for a big company.

Financially, starting up a company in Silicon Valley makes very little sense. You have a very high chance (indeed, a certainty) of having to scrape by on a very low income in a very expensive city. At a time of your life when you should be out enjoying life and meeting friends and generally having lots of fun, you will instead be unhappily tethered to your laptop at all times. In return for sacrificing a six-figure salary elsewhere and general enjoyment of life, you’re given a lottery ticket: you get a minuscule chance of making untold millions of dollars. Being that rich is, undoubtedly, nice. But is it so much nicer than the life of a well-paid computer engineer that you’re willing to give up your life, and hundreds of thousands of dollars in foregone income, in order to have a tiny chance of grasping that brass ring? I know a lot of happy people; there are a couple of successful technology entrepreneurs among them. But I would never say that the successful entrepreneurs are the happiest people I know. So where does it come from, this intense Silicon Valley desire to buy the most expensive lottery ticket in the world?

To find the answer, you have to look to the people running the lottery. In this case, those people are the angel investors and venture capitalists — the people who are throwing ever-greater sums of money at ever-greater numbers of startups, in the knowledge that the overwhelming majority of the companies they fund will end up failing.

What we’re looking at here is basically the Magnetar Trade, in human form. Magnetar had a long/short relative-value strategy in the subprime market: it was short a lot of subprime securities, while also being long a smaller slice of equity. While Magnetar was putting on its trades, the equity slice would make money; when everything blew up, the shorts made even more.

The Silicon Valley trade is also pretty close to being zero-sum. Even on a purely financial basis, if you add up all the profits from successful investments, they barely cover the losses on all the unsuccessful ones. A few big-name angels and VCs can do OK for themselves, but in aggregate the industry of investing in startups does not make money.

But the reality is much worse than that. Essentially the way that the startup ecosystem works is by taking the valuable labor of thousands of hopeful founders, and converting it into large amounts of capital for a tiny number of successes. The fulcrum of No Exit is the point at which it’s unclear whether the startup being followed by Lewis-Kraus will get its next round of funding: either it will raise a sum in the low seven figures, and survive, or else it will simply fail. And the message of the book is clear: the best possible outcome, in terms of the wealth, health, and happiness of the founders, would be the latter. Their startup fails, they get their lives back. They can work for a living and enjoy themselves and not stay stuck on the evil startup grind. If they do manage to raise their next round, that will only serve to prolong their misery.

Founding a Silicon Valley startup, then, is a deeply irrational thing to do: it’s a decision to throw away a large chunk of your precious youth at a venture which is almost certain to fail. Meanwhile, the Silicon Valley ecosystem as a whole will happily eat you up, consuming your desperate and massively underpaid labor, and converting it into a few obscenely large paychecks for a handful of extraordinarily lucky individuals. On its face, the winners, here, are the people with the big successful exits. But after reading No Exit, a different conclusion presents itself. The real winners are the happy and well-paid engineers, enjoying their lives and their youth while working for great companies like Google. In the world of startups, the only winning move is not to play.

Comments
32 comments so far | RSS Comments RSS

I think you hit the nail on the head with this statement:

“And so a huge number of incredibly well qualified engineers, who in previous decades would have put their skills to work being a part of something much bigger than themselves, instead decide to go it alone.”

Everything in American culture would lead one to think that it is easy to launch a new restaurant, hair salon, company, or fill in the blank. I wouldn’t go so far to say that those who do it have a false sense of entitlement – but there’s seemingly no sense of contentment in being a no. 2 or lower in a company.

Posted by Ademanaonge | Report as abusive
 

It’s a good thing Larry and Sergey ignored this advice; otherwise there would be no “happy and well-paid engineers, enjoying their lives and their youth while working for great companies like Google.”

Posted by ajreinhart | Report as abusive
 

One little web start-up does not define silicon valley. While there are no doubt lots of start-ups with no chance of success, it’s not fair to lump them all in the same category. Not all founders have a miserable life, and the one that do are more the exception rather than the rule.

“Fake it till you make it” is not the creed for the Valley; it might be applicable to those who are able to start websites with zero investment besides a laptop and an internet connection, but those are just the start-ups that get the attention of the mass media. None of the start-ups that I have been involved with as founder or investor have ever talked about “killing it, crushing it, having massive success, just about to close a huge round, etc etc.”. Those quotes mostly comes from the wannabes, and not the “computer engineers” that you ascribe them to.

And while we’re on the subject, most of the website or mobile app start-ups that you guys in the general media (I will lazily generalize like you all do and lump you all together) lazily or ignorantly refer to as “tech” or “silicon valley” are not founded by computer engineers. They are started by coders, which are a couple notches below computer engineers on the knowledge and experience scale. They are willing to forego a big steady paycheck because they are short on knowledge and experience, and are not usually “incredibly qualified engineers – in fact, they are mostly just qualified to work on mobile apps and economically unsustainable web start-ups. Their value to established companies that need to develop products that generate revenue and profits is questionable, at best.

If any randomly selected start-up has a 90% chance of of failure, it’s not fair to call it a lottery – a 10% chance of big success is probably six orders of magnitude greater than that of a lottery ticket (or even a year’s half salary’s worth of lottery tickets). And if anyone can afford to take that kind of risk, it’s a 20-something coder.

As for computer engineers not making good entrepreneurs, you really need to define “computer engineer”. I feel comfortable saying most successful tech companies (i.e., those that create revenue-producing products, not just websites, as every company has a website) have been founded by “computer” engineers (not coders or programmers). I haven’t read No Exit, but I have worked with many engineers (very few coders) at many start-ups, and I can’t recall more than a few (literally) who would have been happier working for a big company. It would take turning this already long comment into an insufferably long comment to explain that, but working for a big company is not for everyone.

“Financially, starting up a company in Silicon Valley makes very little sense. You have a very high chance (indeed, a certainty) of having to scrape by on a very low income in a very expensive city.”

You’re making the common mistake of conflating Silicon Valley with San Francisco. SF is not the same as the valley, any more that Wall Street is headquartered in New Jersey because the data centers for high frequency trading are located there. While SF has spawned several high profile web companies, most of the valley lies well south of SF. The valley is still expensive, but that’s where the engineers are. Also, not all start-ups pay low salaries. The ones that are self-funded with no business model may require the founders to live on noodles and peanut butter and live in an abandoned warehouse until they secure their series A, but most funded start-ups pay competitive salaries.

I do agree with you about the root cause or enabling factor of the start-up culture -the casinos, I mean VCs that fund them. I think you’re right about how only a few of them make money, and the rest don’t, resulting in the funding industry being zero-sum, but that’s because their LPs have accumulated far more money than they could ever spend or utilize themselves. So while this culture does waste a lot of talent, it is a good form of wealth re-distribution.

I don’t think you, or Lewis-Kraus, are in any position to judge what makes people happy (I certainly don’t view writing almost daily about finance to be fun). I don’t know if you have ever worked for a very large multi-national company that compartmentalizes your job into little tasks so that your skills can be exploited for a few years, and then discarded when they are obsolete. Many big companies are poorly managed, and while they may offer stable employment in the short term, when the errors of their executives impose their costs on the company, the employees usually pay the price. And then what do they do? People who avoid working for large companies and seek the excitement of start-ups have a different value system than you and all those who would choose the illusion of job security.

I started my engineering career with a large computer company, and each job move had me working for a smaller company, until it was one I started. I wish I could have reversed that order, but I still (for obvious reasons) do not regret any of the risks I assumed by working for smaller companies.

All this being said, I think many start-ups are a waste of time and money. But that’s not my call (other than the ones I put my time and money into). I don’t know who you think should be making that call, certainly not executives of established, giant companies, whose main goal is stifling competition so they can keep those executive jobs and their perks and salaries?

Posted by KenG_CA | Report as abusive
 

While you are right that delusion is driving many founders (and angels, and LPs at VCs, etc.), how different is this from most creative industries in our coastal cities? Does the life of an investment banker ever make sense? What about an aspiring TV writer?

And let’s not overstate the abilities of most of these founders: not everyone gets to work at Google or Facebook. Many engineers work boring jobs at companies doing little interesting stuff. And most of today’s founders aren’t engineers to begin with; they’d probably be stuck in the marketing department of a spam firewall company or some similar position.

While I applaud any attempt to bring a more realistic attitude to San Francisco right now, I think the more salient aspects of this bubble are the insane amounts of money sloshing around, the resulting uncontrolled growth of young companies, and the lack of any actual visionary ideas.

Posted by AngryInCali | Report as abusive
 

I don’t understand the comparison to Magenetar. Are you saying that the founders themselves are making this trade? Going short on regular employment income, long on the small probability of VC / PE / IPO success. The VCs are long-only, on a diversified portfolio of low-probability things. I guess the founders could be seen as “short fixed income, long equity”, but it’s just not the case that the short leg ever produces any value. Magentar made money when the fixed-income instruments they shorted blew up. A founder of a startup doesn’t make money if some existing larger firm he could’ve been working for blows itself up.

Posted by Auros | Report as abusive
 

What a naively cynical and deeply complacent book review, Felix. You should be ashamed of yourself for parroting this nonsense.

Gideon, like writers everywhere, has strong opinions in order to sell more books. I’m glad for him and his writing career, but the conclusions that he draws are too broad, and the sample is too small. Yes, 90 percent of all startups fail. Anyone who even idly considers joining or founding a startup will not be surprised by those grim statistics. But the people who make startups happen are also constantly recycling themselves into new startups.

I wonder what you would have young people do exactly. They could go into investment banking, where they would waste several years of their life for exactly zero equity and even less enjoyment. (Analysts have as much chance of becoming MDs as founders do of becoming billionaires.) They could become cub reporters, which probably have an equal rate of burnout and a much lower salary. Or they could get on the lowest rung of the corporate ladder, with the simple hope of climbing one or two paygrades per decade. What fun.

Why do outsiders drone on about the “mass delusions” of Silicon Valley? Does it comfort the Brooklyn existence? Does it reassure a person that they’ve made the right decision by opting for the stale hierarchies of Manhattan? Do you think the delusions would persist if there wasn’t something to them?

I really can’t believe you’re recommending that coders work for Google rather than build something themselves. What the hell do you know about it? Take a little responsibility for the pulpit you have at Reuters.

First of all, Google isn’t an option for everybody. And if it was, it would be the most slavish option, the tech equivalent of going to work for an i-bank, which college graduates do for lack of self-knowledge and better ideas. All those Ivy League kids hopping on the bus to become telemarketers in Mountain View find that out soon enough.

Sure, coders may not make good entrepreneurs, but the best founders complement each other. One is the hustle, the other is the code.

I work in a startup and have been involved with several. The founding teams are always code + hustle. They all go through pivots, partial failure and 14-hour days. Many also see 70% month-on-month growth.

In the startup ecosystem, labor and failures don’t convert into success as you imagine. The ecosystem is a testing ground for ideas. There are many bad ones, and many people who are unable to recognize how bad they are. That’s not the fault of the system but of humanity, and corporations are just as guilty of stupidity and wasted effort as startups are. The founders who succeed are the ones who fail intelligently, who know how to read the results of their failure.

Good VCs aren’t trying to set people up for a fall. The most successful venture investors provide a path for young people to lead their own companies, some of which become wildly successful. Those young people could have stayed in middle management if they wanted, and opted for a duller existence. In many places outside of Silicon Valley, that’s their only option: to work for the powers that be, to sustain a system of privilege that will grind them down. Let SV be an alternative to that. There’s no end of sclerotic, ossified industries in other countries where ambition can go to die.

Startups are the stem cells of society. They’re the place where something new is grown. Journalism and publishing are the dead skin that society is presently sloughing off, unprofitable enterprises of only occasional utility. It doesn’t surprise me that you would hold your opinions, given your job, but they don’t do justice to your intelligence. Read someone who knows his business next time, and let Gideon sell his revelations to the newbs. Everyone else knows already: Startups are hard. The good ones are worth it.

Posted by ChrisNicholson | Report as abusive
 

Good thing the founders of Google. And Apple. And every other company where you advise people to get “comfortable jobs” didn’t heed this advice.

This is just as hyperbolic as the “dream” scenario.

The truth is, every single company on the planet was once a startup.

Railing against the narrative makes sense.

Concluding that no one should start companies makes none at all.

Posted by Davealevine | Report as abusive
 

Who am I to tell others what should make them happy? If the decision doesn’t make sense to you, then it is at least as likely that you don’t understand what makes an entrepreneur tick as it is that they don’t understand their situation.

Posted by TFF | Report as abusive
 

Felix,
Is there an email address to send you a message. I couldn’t locate one.

Posted by Nathan_Schor | Report as abusive
 

How about a nice game of chess? (don’t think that last line would get by)

Posted by JonathanHutter | Report as abusive
 

hello Felix ..
i read your letter .i think is not for me ..
i know you by name Felix Salmon ( in basic of your article ) i have read i am very impressive with your smartness professional thank you
i don’t know if you in my place will do the same what some one write eh ..
in fact i don’t know you at all
maybe you know me ..
Q can you accept some thing (job or relationship or i don’t know what ells) because i say to you ? or some body say to you ? and all this on line ?
I DON’T KNOW YOU …and i don’t like ticket lotto ..
ah and i don’t know no one there every one is FELIX OR DONNA OR PAUL OR …OR …
STOP TO PLAY GOOD (DITHEN I CAN HELP ) OUT THERE HAVE MIILION’S OF YOUNG PEOPLE WITCH DON’T HAVE JOB )

Posted by europjoy | Report as abusive
 

hello Felix ..
i read your letter .i think is not for me ..
i know you by name Felix Salmon ( in basic of your article ) i have read i am very impressive with your smartness professional thank you
i don’t know if you in my place will do the same what some one write eh ..
in fact i don’t know you at all
maybe you know me ..
Q can you accept some thing (job or relationship or i don’t know what ells) because i say to you ? or some body say to you ? and all this on line ?
I DON’T KNOW YOU …and i don’t like ticket lotto ..
ah and i don’t know no one there every one is FELIX OR DONNA OR PAUL OR …OR …
STOP TO PLAY GOOD (DITHEN I CAN HELP ) OUT THERE HAVE MIILION’S OF YOUNG PEOPLE WITCH DON’T HAVE JOB )

Posted by europjoy | Report as abusive
 

I think stucturing your argument in terms of personal financials makes total sense, but I think you’re missing a fundamental component of why folks start companies. Founders aren’t always necessarily profit-driven. Many founders want to ‘change the world’ or simply work for themselves. I think the prospect of working for yourself and making enough money to hire people and grow / BUILD something is more appealing than simply signing up for a lottery. Not everyone is trying to make the next Facebook, but would be more than happy to build a product / service that makes them a living and then some. Equity is the homerun (assuming its worth something), a salary is settling for a single. “If you’re not busy building your dream, you’re busy helping to build someone else’s”.

Posted by daino3 | Report as abusive
 

While I agree that running a startup is tough and that 90%+ of us will fail, that doesn’t mean we hate it. People contemplate their “corporate” jobs everyday, always looking for a new and better one – most Gen Y switch jobs every 18 months.

The average entrepreneur is over 40, so all this glam and hype we see really skews the real figures beyond what the media will cover for page views. While I’m sure Gideon is talented, smart and spoke with a lot of people for their book, it’s hard to take advice from someone who never started a company before. I’m sure in his writing career, he basically felt like a startup so there are some similarities.

In order to get to the top, you have to work hard, make scarifies and hustle through. Being an entrepreneur is a lifestyle, not just about the companies you start and it’s not just for “tech” companies. Look at Jay-Z and 50 Cent who rap about selling drugs – their entrepreneurs and definitely had the odds against them, which can be said about more professions. If anything, this book will hopefully motivate people to work harder and not deter them from doing something great.

Posted by TraceCohen | Report as abusive
 

It really expands your abilities when you attempt to build a company of any sort. I was an actuary for many years, and a very good one. I did many entrepreneurial things inside larger firms that succeeded.

But when I tried to build my current firm inside a larger firm, I couldn’t do it, because I didn’t have the focus to do it right, and neither did the firm. Only when I went out on my own did I gain the focus to do it, because failure was no longer an option. It was “succeed or die.”

Many entrepreneurs fail in their first few tries. It is expensive tuition, but usually the lessons learned lead to later success.

Posted by DavidMerkel | Report as abusive
 

Most software engineers I know (30 years in the business, including half a dozen startup products built), do the startup route because they are far more capable than what enterprise environments will put them to work on.

Also, what’s the risk of NOT trying a few startups, especially when young and talented? You can fall back on a “job” later in life if you need be. (Just don’t get yourself into major debt, live cheap).

…which is what many an engineer will do for something more valuable than a fat paycheck: ADVENTURE.

The startup doesn’t have to succeed to get the opportunity to press the limit on what one can achieve. Good luck with the low ceiling of potential in traditional enterprise environments where you’ll have some paper-pushing administrative type managing the situation, typically with none-to-out-dated hands-on skills, yet calling the shots (and, thus, CYA is priority #1. Oh, yes it is).

As for VC being thrown in, many are going to pay taxes on it anyway. So, they throw it into a venture. And/or, it’s discretionary income for many and they, too, want adventure.

It’s about LIVING, not safety-in-a-paycheck. Ask those on their deathbed who played it safe all their life. It’s, by far, more stupid not to take chances, live life, and with a passion vs. “security”.

Posted by Trober | Report as abusive
 

With all your focus on the money you seem to forget about one thing: dreams. People start business because they have dreams. That dream might be to make a lot of money, but it can also be to change the world. And if your dream is to change the world, then a year on less-than-minimum wage is a sacrifice you’re willing to make.

Posted by kvnplgrms | Report as abusive
 

Today’s VC industry is just another manifestation of overly low interest rates. Yield-hungry investors over-fund VC firms, which cannot leave the capital idle, so they dump too much money into too many startups with too little real promise.

When rates inevitably rise to historical norms, this problem will correct itself. I wouldn’t want to be living in Silicon Valley when that happens.

In the meantime, the flood of VC money blunts business reflexes. An entrepreneur backed by tens of millions in seed capital finds profit more slowly, because survival does not depend upon it — until suddenly it does.

Posted by zipflash | Report as abusive
 

I know dozens of software engineers aged 30 to 50. Only one was a storybook Silicon Valley VC startup success. The rest are (1) VC startup guys who haven’t made a penny; (2) big-company men, superficially comfortable but desperately afraid of their next layoff and waning skill relevance; or (3) bootstrapped entrepreneurs in good-sized cities outside Silicon Valley.

Interestingly, those in the third category are all millionaires. All of them. 4 people, 4 eventual successes in unrelated businesses, 4 millionaires. That’s a small sample, but this 10% of the engineers I know constitute 80% of the millionaires. Bayes would suggest this is the model to examine.

For the entrepreneur, the sweet spot is apparently to build an unfunded, bootstrapped startup in a good-sized city outside Silicon Valley. The second-tier location brings lower rent, labor costs and labor turnover. Lacking capital, you must look for a smaller, more immediately exploitable market niche, and pursue immediate break-even (or die — good incentive).

This reduces the odds of a storybook IPO, but improves the odds of a thriving business. Entrepreneurs from Silicon Valley won’t bother to copy you, because your target market is too small to attract VC, and their costs are too high to compete. Even if you fail, you fail quickly — months, not years — letting you try again or move on to something else.

Posted by zipflash | Report as abusive
 

The book’s generalizations about engineers are multiply wrong. Five examples:

First, nearly all tech startup founders are engineers, who develop the additional skills necessary to run a company. This is not just somewhat true, but overwhelmingly, almost universally true. This suggests that engineering ability is a necessary condition for tech startup success (funded or bootstrapped).

Second, engineering is essentially a process of taking an unstructured real-world problem and translating it into a structured communication of steps to solve it. Thus engineers, by their very nature, must thrive on grasping and organizing a LACK of structure — or they cannot function. Engineers, in short, have an urge to create structure, not to receive it.

Third, big-company jobs do not reliably provide a chance to “work on something bigger,” because software projects do not scale well. This has been true for decades — to see why, read “The Mythical Man-Month” (Brooks, 1975). Small teams invent essentially everything.

Fourth, big-company salaries provide little security, because, again for decades, the tech industry has been prone to waves of layoffs.

Fifth, software engineers over 40 slowly become unemployable as their skill set becomes irrelevant, making it difficult to find new work after a late-career layoff.

The book makes some great generalizations about the false promise of VC-backed startups. It should have stopped there.

Posted by zipflash | Report as abusive
 

zipflash, your sweet spot described my story exactly (except I’m older than 50, but this happened in my 30s and 40s). I would suggest it to any engineer that wants to start a company, as I try to steer them away from big, VC-funded projects, where they are just employees of the VC firm.

Posted by KenG_CA | Report as abusive
 

Zipflash: loved your comment. Well spoken and dead-on with my experience as well.

Posted by Yakabod_SR | Report as abusive
 

KenG makes very good points. On some level, this choice is really about personal preference and what a person enjoys. I will say that someone starting a tech company just because of the desire for fame and fortune is likely to fail. That’s true of a lot of fields in life, though – fame and fortune come to those who have a genuine intrinsic interest in their work and aren’t just focused on monetary rewards.

Echoing AngryinCali’s first points, Felix’s logic in this post could also be used for all of the following: acting, professional athletics, starting a restaurant (these also have a high failure rate), writing a novel (or movie screenplays, or a TV series), and professional music. I could list others, but the point is made. There are a host of “lottery ticket” professions that people pursue in the name of following their dreams. Trying to be a tech entrepreneur offers a better standard of living than most of them, and also better backup options in the event of failure.

Posted by realist50 | Report as abusive
 

While I haven’t read the “No Exit” book I believe your premise, that entrepreneurs start companies with the ultimate goal of being happy, is incorrect. And even if that is the purpose for some entrepreneurs that pursuit and “grind” is not going to be enough to make them happy. Happiness comes from living a well balanced life and knowing what is most important–the relationships that on are this journey of life with you.

Getting back to the topic at hand, entrepreneurs need more than just the pursuit of happiness. They need to have a strong desire to start a company in silicon valley because they want to change the world and don’t mind amassing wealth as they do so. Having that one idea that is a game changer and disrupts a market is the drive–this is what makes America and Silicon Valley great. The motivation is knowing that taking that kind of risk, despite the odds, can influence the world for the better.

Posted by acinvstr | Report as abusive
 

While I haven’t read the “No Exit” book I believe your premise, that entrepreneurs start companies with the ultimate goal of being happy, is incorrect. And even if that is the purpose for some entrepreneurs that pursuit and “grind” is not going to be enough to make them happy. Happiness comes from living a well balanced life and knowing what is most important–the relationships that on are this journey of life with you.

Getting back to the topic at hand, entrepreneurs need more than just the pursuit of happiness. They need to have a strong desire to start a company in silicon valley because they want to change the world and don’t mind amassing wealth as they do so. Having that one idea that is a game changer and disrupts a market is the drive–this is what makes America and Silicon Valley great. The motivation is knowing that taking that kind of risk, despite the odds, can influence the world for the better.

Posted by acinvstr | Report as abusive
 

Don’t be silly …

Friendship is forged in the trenches, fighting against something much bigger than anybody, including the Twitters, Face books, Goggles, & them lot – fighting those odds… that belong to no-one & are up for the taking. Sweet self-deception, “enjoying life and meeting friends and generally having lots of fun”. You try, and whatever comes out of that struggle is worth listening to…

The other thingies much bigger than oneself that tend to yield paychecks are not exactly known to forge brotherhood among men, mostly politics… Perhaps that too turns into a brotherly fight every now & then, but again, the externalities do not look much like Twitter, Google or Facebook.

Business skills – yeah, that’s what you get to learn “enjoying life and meeting friends and generally having lots of fun”… Absolutely necessary in the trenches.

Knowing when to quit must be an art [you living ?]. For whatever reason, it is not much sung. The ones that get it are no longer around to tell how they’ve done it, only the failures. And the ones who trade trenches.

Posted by A-V | Report as abusive
 

Your entire post is predicated on the erroneous assumption that money is the only deciding factor on whether you want to work for yourself or not. Spend some more time talking to people before writing.

Posted by cemdev | Report as abusive
 

C’mon, guys, you aren’t thinking like a connoisseur. The only meaning in life is a relaxed dinner at a fine restaurant over a bottle of good wine. Idle comfort is the ultimate goal of all creation.

Posted by TFF | Report as abusive
 

The ultimate irony: Felix is leaving Reuters to join a start-up (okay, one with lots of money, he wont be miserable): http://gigaom.com/2014/04/23/felix-salmo n-is-leaving-reuters-for-the-fusion-netw ork-because-the-future-of-media-is-post- text/?utm_source=feedburner&utm_medium=f eed&utm_campaign=Feed%3A+OmMalik+%28Giga OM%3A+Tech%29

So these comments were probably the last Felix Salmon Smackdown.

Good luck there, Felix. I know I, and many other regulars here, will miss this place.

Posted by KenG_CA | Report as abusive
 

What we’re looking at here is gambling. It’s not basically different from buying a lottery ticket, or more like buying multiple tickets. Evidently the investors are looking for the giant payoff, and accepting (or are not aware of) the probability that they will never get a big return. Or maybe the operators of the venture funds are aware of probability and are just gambling with other people’s money.

Hedging, whether it’s Magnetar or hedge funds, is different.

Posted by skeptonomist2 | Report as abusive
 

I hope RadiumOne fails. Yesterday.

Posted by Curmudgeon | Report as abusive
 

I hope RadiumOne fails. Yesterday.

Posted by Curmudgeon | Report as abusive
 

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