It depends on person 1′s motivation. If his or her motivation is selfish, then I agree with you, but if the motivation is altruistic, that makes the utility of money linear, and startups are a potent way to maximize expected money.
That is the VC propaganda line, yeah. I don’t think it’s actually true; for the median LW-using software engineer working for an established software company seems to net more expected value than starting a company. Certainly the person who has spent the last five years of their twenties attempting and failing to do that is likely making repeated and horrible mistakes.
The math should actually be similar for what VC or EA would prefer you to do.
I think the actual problem is that almost no one is altruistic enough to say: “For a sufficiently large value of X, I prefer a 1% chance of making X and a 99% chance of being homeless, over a 100% chance of living a happy middle-class life”.
The math should actually be similar for what VC or EA would prefer you to do.
Not if most VCs lose money and are led astray by auctioneer’s fallacy. Also not if a tertiary goal of most VCposting is to get people to quit their jobs and try, and so increase the supply of investment opportunities available to pick from.
Yeah, but even if the advice VCs give to people in general is worthless, it remains the case that (like Viliam said) once the VC has invested, its interests are aligned with the interests of any founder whose utility function grows linearly with money. And VCs usually advise the startups they’ve invested in to try for a huge exit (typically an IPO).
It depends on person 1′s motivation. If his or her motivation is selfish, then I agree with you, but if the motivation is altruistic, that makes the utility of money linear, and startups are a potent way to maximize expected money.
That is the VC propaganda line, yeah. I don’t think it’s actually true; for the median LW-using software engineer working for an established software company seems to net more expected value than starting a company. Certainly the person who has spent the last five years of their twenties attempting and failing to do that is likely making repeated and horrible mistakes.
The math should actually be similar for what VC or EA would prefer you to do.
I think the actual problem is that almost no one is altruistic enough to say: “For a sufficiently large value of X, I prefer a 1% chance of making X and a 99% chance of being homeless, over a 100% chance of living a happy middle-class life”.
Not if most VCs lose money and are led astray by auctioneer’s fallacy. Also not if a tertiary goal of most VCposting is to get people to quit their jobs and try, and so increase the supply of investment opportunities available to pick from.
Yeah, but even if the advice VCs give to people in general is worthless, it remains the case that (like Viliam said) once the VC has invested, its interests are aligned with the interests of any founder whose utility function grows linearly with money. And VCs usually advise the startups they’ve invested in to try for a huge exit (typically an IPO).
Tru