Having worked in business incubation at a research university, helping researchers find angel investors, I’d like to throw in my two cents:
First of all, the article runs headlong into survivorship bias. For each Bezos or Gates, there are thousands of entrepreneurs with financial backing that went bust. And the vast majority of those who didn’t were acquired by larger, established companies before they could even hit the news (in my area, the ideal exit strategy was said to be acquired by Cisco, rather than an IPO). Many of these startups had even more initial backing by the three f’s (family, friends and fools).
Now, let’s look at those who didn’t have financial backing. For such people, there are angel investors. As others in this thread pointed out, one needs to have good connections to find such investors. Good connections are available in most, if not all, research universities, via their business incubators. Universities, however, will retain part ownership of the company (licensing any research or technology back to the entrepreneur), and they are still thinking in the medium term. They are not looking for unicorns, but a steady stream of revenue, so their preferred exit strategy is indeed the acquisition. I’m certain that the very few poorer entrepreneurs who’d strike it rich in IPO were pressured into selling their company. That’s why you don’t see any examples of a company truly being pulled out of nothing. And don’t get me even started at the wasted opportunities where the professor didn’t sign the research licensing papers because he’d make a comfortable living keeping the research at the university…
Point of this is that it will be statistically likely that we’ll get a few super-rich entrepreneurs, and they’ll come mainly from backgrounds where they could secure seed financing. That does not mean they didn’t work very hard with the money they were given.
That does not mean they didn’t work very hard with the money they were given.
The point isn’t that you don’t need to work hard to become successful. It’s that success tends to favor those who come from privileged backgrounds, especially when that privilege is already being wealthy.
You seem to have read the article as “Being wealthy ensures success” when instead the point is “Becoming ultra-wealthy and/or successful starts with being wealthy and successful.”
That was pretty normal. But the angel and venture investors walked away with money. And if the founders were smart or assertive enough, they also made enough money to start a new venture, possibly with less external seed funding.
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Having worked in business incubation at a research university, helping researchers find angel investors, I’d like to throw in my two cents:
First of all, the article runs headlong into survivorship bias. For each Bezos or Gates, there are thousands of entrepreneurs with financial backing that went bust. And the vast majority of those who didn’t were acquired by larger, established companies before they could even hit the news (in my area, the ideal exit strategy was said to be acquired by Cisco, rather than an IPO). Many of these startups had even more initial backing by the three f’s (family, friends and fools).
Now, let’s look at those who didn’t have financial backing. For such people, there are angel investors. As others in this thread pointed out, one needs to have good connections to find such investors. Good connections are available in most, if not all, research universities, via their business incubators. Universities, however, will retain part ownership of the company (licensing any research or technology back to the entrepreneur), and they are still thinking in the medium term. They are not looking for unicorns, but a steady stream of revenue, so their preferred exit strategy is indeed the acquisition. I’m certain that the very few poorer entrepreneurs who’d strike it rich in IPO were pressured into selling their company. That’s why you don’t see any examples of a company truly being pulled out of nothing. And don’t get me even started at the wasted opportunities where the professor didn’t sign the research licensing papers because he’d make a comfortable living keeping the research at the university…
Point of this is that it will be statistically likely that we’ll get a few super-rich entrepreneurs, and they’ll come mainly from backgrounds where they could secure seed financing. That does not mean they didn’t work very hard with the money they were given.
The point isn’t that you don’t need to work hard to become successful. It’s that success tends to favor those who come from privileged backgrounds, especially when that privilege is already being wealthy.
You seem to have read the article as “Being wealthy ensures success” when instead the point is “Becoming ultra-wealthy and/or successful starts with being wealthy and successful.”
Explain what you and billionaires consider hard work.
My company was acquired by Cisco … and within six months everyone from the original company had been laid off.
That was pretty normal. But the angel and venture investors walked away with money. And if the founders were smart or assertive enough, they also made enough money to start a new venture, possibly with less external seed funding.