Survivorship bias seems to play a huge role in VC too. A handful of individuals and firms got mega-rich with Facebook and then later with Uber, and now they are held up as these huge geniuses. However, this is more luck than skill, because all oof their later investments have done much worse, so excluding Facebook and Uber, they are not so skilled. Now these same geniuses are hyping crypto , which has been a total disaster for half of 2021 and all 2022. Same for Softbank, which had a big winner with Ali Baba, but pretty much failed massively with later bets. Successes have many mothers, failure is an orphan, as it's said.
This. I always get annoyed when entrepreneurs eg. on Shark Tank say things like “I quit my job, took out two mortgages on my home, maxed out my credit cards and spent my kids’ college fund on the business. And look at us now, we’re making millions of dollars a year! Don’t give up when failure looks inevitable!”
Probably most of the people who follow this advice to the letter end up financially ruined, they just don’t get a public platform to talk about it…
Quite. I think Shark Tank is what we call Dragon's Den in the UK (bunch of civilians pitch to zillionares for cash and mentoring in return for a stake in the business - all on TV).
You see some absolute horrors that inevitably will lead to bankruptcy. However you also see some clever folk getting a well deserved leg up.
But I think we agree that for everyone that seems to effortlessly do the American Dream thing, there are 1000s or 100,000s that don't. Then there's the likes of me that have run a rather boring small business for 22 years turning over around £1.2M pa but not exactly setting the world on fire! I can sleep at night and have nearly no debt, so that's nice.
I just want to point out that you’re living the American Dream. I think you may misunderstand the term as it’s generally used.
The phrase isn’t about becoming a billionaire. It’s rooted in the American frontier period, inspired by Protestant values, and is much more aligned with living a happy upper-middle-class life: owning land, a home, enough resources to have a family, and having meaningful or productive work.
I wouldn't even say upper-middle-class. Descended from Irish orphans, jewish refugees, Pennsylvania Dutch coal miners (so the classic Amish Jewish Redhead, without red hair). A relatively safe work environment, owning a home, feeding their family, not having your government try to exterminate you. That was their American dream. You know, the little things.
The American dream was historically a question of upward social mobility both for you from your parents and your children from you. It’s very much a question of economic, social, and political gain. It stood in stark contrast to countries people immigrated from with extremely limited mobility across generations.
In that context it’s clear America is failing due to shrinking social mobility.
The noteworthy part is that the American dream for these people meant mobility from serfdom and abject poverty to a lifestyle that would now be considered abysmal.
For an Irish immigrant it wasn't about becoming a billionaire, it was about making sure your children have enough food to survive a winter.
Social mobility from nothing to basic necessities is still quite high in the US. Maybe not home ownership, but there are a lot of clear paths to be able to feed a family.
Defending the decline in living conditions by comparing it to standards from a developing economy is a bad justification. The problem isn't that the US isn't generating wealth, its that its poorly distributed.
The US is full of poor people but the country has never been poor. It's an amazingly wealthy place.
That’s only a small part of the story, middle income and even wealthy people also immigrated to America seeking the American dream of upwards social mobility. Even a surprising number of aristocrats immigrated to America seeking their fortune.
I agree they are not the only story, but I think a majority of people would fall under that umbrella. Middle class in 1800s looked a lot different than today.
Fair point, though serfdom largely ended much sooner than mass immigration to America and abject poverty by the standards of the time wasn’t that common.
EX: “In England, the end of serfdom began with the Peasants' Revolt in 1381. It had largely died out in England by 1500 as a personal status and was fully ended when Elizabeth I freed the last remaining serfs in 1574.[6] Land held by serf tenure (unless enfranchised) continued to be held by what was thenceforth known as a copyhold tenancy, which was not completely abolished until 1925 (although it was whittled away during the 19th and early 20th centuries). There were Scottish born serfs until the Colliers and Salters (Scotland) Act 1775 prevented the creation of the status, and 1799, when coal miners who had already been kept in serfdom prior to the 1775 Act gained emancipation.[7] However, most Scottish serfs had already been freed.“ https://en.wikipedia.org/wiki/History_of_serfdom#Great_Brita...
> and is much more aligned with living a happy upper-middle-class life
As and ethos I think more accurately it has never been about a particular description of "good life", but more about the freedom and opportunity to try and make a better one for you and your family, however you define that.
Maybe it's just me getting older, but running a successful small business that pays the bills and supports my family into retirement is what I would consider the paradigm of success for my life. Congrats on your business.
Moreover, just with the sheer count of VCs, stock investors and other sorts that play with their (or more often other people's) money to try and earn outsized profits, it is inevitable that a small sliver of them will be wildly successful. It's a statistical certainty. It's like having a million people toss coins all day and then hail as geniuses those who got twenty heads in a row.
There is an excellent book by Nassim Taleb that expands on this theme titled "Fooled By Randomness".
Successful people toss coins in games where the odds are in their favor. Saying if they win it's just luck is pedantically true, but if you keep playing those kind of games you'll win. Keep playing the lottery, and you will lose.
Successful people I know don't buy lottery tickets.
> Successful people I know don't buy lottery tickets.
Are we talking about typical "work hard, relatively successful people in middle class" or "extremely rich people" here? Because the latter, I can guarantee, is typically due to pure luck, despite all what we want to believe.
Gates, Bezos, Jobs, Musk, etc.? They were sitting at home, chillin' with a beer, and rubbed the bottle they bought from the thrift store, and Shazzam! 3 wishes each!
> Gates, Bezos, Jobs, Musk, etc.? They were sitting at home, chillin' with a beer, and rubbed the bottle they bought from the thrift store, and Shazzam! 3 wishes each!
If you read a little bit about what happened in each of their cases, they were at the right place at the right time (and with access to computing resources that most people did not have) usually before anyone else could be. That's what "luck" is all about. You couldn't have become Bill Gates 5 years after he was around. That does not mean that none of them had great skills or great ideas, but that's just not enough to become massively successful.
While generational shifts are a pre-condition to becoming _that_ wealthy, they're not enough. Plenty of people were alive then (and had the resources required to bet big), but there's only a handful of Gates and Bezos. To make it that big you need to:
1. be at a point in history where you can bet big
2. have the resources to do so
3. be right
4. put in the work
All are required. I feel like supporters overemphasise 3. & 4. and detractors hammer on 1. & 2.
Now, the good news is you don't need to reach tech-billionaire levels of worth - and virtually everyone here won't. If you're happy with an orders of magnitude lower net worth (which is still in the 99th percentile), there are other ways to get that which don't require 1. You still need 2,3 and 4. That's good news because there aren't many opportunities for 1. (off the top of my head, trends that _look_ like they'd fit the bill currently are crypto, VR, space stuff, fusion energy, ESG, human longevity)
5 years from now, you will rue today as you didn't see the opportunity in front of your face. Someone is in a garage right now becoming the next billionaire that you (and me) muffed.
Oh, but I have read about them. What they did was recognize the opportunity in front of them, that everyone else did not see.
Nobody remembers Lotus, which for many years was a much bigger company than Microsoft. Lotus eventually failed because of some terrible business decisions, not bad luck.
They also all worked their asses off.
Tim Patterson was another who was in the right place at the right time. Nobody remembers him. He wrote the original PC-DOS. He didn't know what he had, and sold it to Microsoft for a song.
Gary Kildall was in the right place at the right time. He blew it.
I was in the right place at the right time, several times. I blew it big time, because I did not recognize the opportunity. So have many others I personally know.
Want to look at Jobs again? He had not one, but three incredible success stories. The first Apple Co., Pixar, and the Apple we know today. With Pixar and Apple, he turned both companies from inevitable bankruptcy into incredible success.
Just want to chime in and say: samesies. I wish I could say more, but eh. Some of us were ready, willing, and able, and some circumstance or opportunity was unrecognized or ignored or not taken far enough. Probably a lot of us. But I also want to say that we cannot be reasonably bitter about this. Chin up, fella. We have witnessed miracles and wonders.
Under certain circumstances, playing a lottery is a completely rational idea. Even if mathematical expectation of a win is negative, taking into account utility function can turn it positive. After all, mathematical expectation of buying insurance is negative too, but we don't talk down on those who buy insurance.
I don't buy collision insurance on my car. Haven't for 40 years, because my car was totaled 40 years ago and the insurance payout was so meager I realized that self-insurance was a far better deal.
Buying insurance on appliances and other devices is a waste of money, too.
You are a fool if you believe you have much more chance than winning the lottery. You can play the lottery all your life and never win anything, and that's a hell of a lot more likely than gaining anything from it.
It could be evidence that the idea of VCs may not be a reliable way of investing.
Nassim Taleb stated that in 2009, within an 18 month window, banking industry lost all the profits it ever made since the beginning of banking as an industry.
Such a catastrophic event isn't out of the question for VC either.
> Such a catastrophic event isn't out of the question for VC either.
It is out of the question with the current legal system. Because of limited liability for this to be true they would have to have invested more than the total profits. The individual investments could lose a lot of money but the VC loss is capped at their original investment.
Tautologically. There isn't a facebook in any failing VC fund. So it's really unnecessary to talk about VC strategies at all if you're going to define a successful strategy as having once invested in some whale early and ignore all of the other failures, it's sufficient to just ask for a list of the investors in things that did well and declare them shrewd.
Not rally, if you take the reality of it a big further i.e. 'there is an FB in every vintage' or more like 'there are a 'few big hits' in every vintage' - you'll find that the pattern is repeated over and over by good VC's who can demonstrate their consistency.
But why is it that some VC are clearly better at this dice rolling? ex. Sequoia
Again and again they seem to be able to discover these home runs or is it that they are able to use their vast network of influence to manufacture success?
It all reminds me of poker. High stacks dictate/influence/restricts other participants with less stacks.
100% spot on. It's like Jim Cramer and Mad Money. His stock picks are terrible compared to the index/average, yet he somehow has a following (and a show)
The analogy to the world war 2 bomber story is applicable only if you accept the core premise of the article: that most of it boils down to luck.
If the successes of the successful really are the result of their decisions, planning, approach, or other action on their behalf, then where the bullet holes wound up on an airplane isn't analogous.
I personally do think that luck has a lot to do with it, but it's not sheer luck, it's recognizing opportunity and capitalizing. Yes, the iPhone wouldn't exist if it weren't for the DoD building GPS. But the DoD building GPS didn't make the iPhone either. Apple made the iPhone, while other competitors tried to make something like it. It was the decisions that led to the iPhone that can teach us about it's success.
Every set of decisions occurs within an environment. The parameters of that environment can be called "luck" if you want, and success within that environment can be ascribed to the environment itself by way of the word "luck." But looking at it that way tells you less about success than the success stories. After you armor the engines and you get more planes making it home, you don't call that luck, you call that good decision making. And you ascribe the success to the decisions, you don't dismiss them as survivorship bias.
I don't think the article is arguing that it's just luck, just that luck plays a huge role.
But also, and more importantly, the article seems to be arguing that these success stories are mostly unhelpful. If you do all that Steve Jobs did, it's likely you won't be even remotely successful as he was. "Stay hungry, stay foolish" is inspirational -- I like the quote -- but also mostly meaningless. Like "follow your passion", "work hard", etc. Yes, we all already know this, and it mostly won't help us become the next Steve Jobs.
I'd agree that these pop, self help seminar success stories are unhelpful, but for different reasons (although they are mentioned in the article): people with these stories rarely mention the not so pretty parts of the story unless those parts serve to "teach a lesson" in line with the narrative in the story, and that successful people tend to ascribe success disproportionately to themselves in a manner very akin to superstition. Most of what they're telling you were the keys to their success will be unhelpful, nevertheless, examining their success with your own mind and not with their words can show you a great deal about what works and what doesn't.
I’ll add that it propagates the other way too: only those who’ve positioned themselves to take advantage of changes in the environment can get lucky. Taking the iPhone example: have you built a team of engineers, designers, and manufacturing experts able to create and launch an iPhone when it becomes possible? One company did. This is what VC types call “creating your own luck”. Being prepared to seize new opportunities doesn’t make them happen, but they happen often enough that being prepared for them has a positive expected value.
How do you, personally, prep for luck? By cultivating valuable skills, minimizing overhead and commitments, earning the respect of a lot people, having a well-calibrated risk tolerance, and so on. You are trying to turn luck from a necessary but insufficient condition to a necessary and sufficient one.
That's not really the thing. First, people immigrate from one country to another all the time. Not to mention you can move around freely within a country. Most people in San Francisco are not from San Francisco (people from San Francisco are pretty upset about it). Second, people are successful and have good lives outside of San Francisco.
That is certainly true, but realization of that fact won't help you in your life at all. There are infinitely many statements that are true but unhelpful. However finding some motivation and lessons from success stories can help you whether you are tending a tea plantation or a web startup.
The B-17s underwent continuous improvement throughout the war as what worked and what didn't work was learned.
Also, if a B-17 crew survived their first 5 missions, they had the same chance of surviving the next 25. This isn't luck, it's learning.
My father wasn't everyone's drinking buddy in the Air Force in the Korean War, but when there was a dangerous mission for his squadron, he would be asked to lead it, as he'd get the target hit and bring them back with the fewest holes in the airplanes.
I'm sure that successful businessmen also consistently make better decisions than the unsuccessful ones do, even if each incident is luck.
It seems to me that this is na obvious heuristic - that experience matters when applied to well defined roles. The more simplified role You look at (just look at chess or go players) the easier it to defend this intuition.
But being businessman and especially sucessfull one is too ephemeral and not well defined - it entails almost every posible activity You can imagine. And I do not buy that this obvious heuristic is also so obvious in this case. Most powerfull businesspeople will claim it is but they have vested intrests in it being so.
There are many, many obvious mistakes people make in business. The notion that people cannot learn from these mistakes and improve their odds is bizarre.
For example, being sloppy with the books has sunk many businesses. Failing to look out for employee embezzlement is another. Undercapitalization. Hiring friends. And on and on.
I'd agree; you can't boil it down to just luck or just hard work. I think it a correct notion that fortune favors the prepared, and neither luck nor hard work on its own suffices.
If you look more closely, I believe that hard work, luck, nepotism and sociopathy all become apparent factors in successful business, with their levels being able to be exchanged to some degree (with some having a greater amount of variability, depending on variation of the others).
In the end: you are right; a bar of gold can fall onto a dead body, but he's no better for it.
Luck alone is sufficient. As a simple example: if you've been born into the Gates or Zuckerberg family you will have as many tries as you need until you succeed.
And if you've been born in some parts of Africa you're almost certainly going to be
SOL
It’s funny, both the author and I have watched Jobs’ commencement address, but it’s as if we had watched two completely different speeches. I can’t remember a single moment that I interpreted as some cheesy “do this and you will be successful, like I am” recommendation. To me it’s a speech about a life philosophy, and has very little to do with “success” in the shallow sense. It doesn’t inspire me to try to become Steve Jobs, it inspires me to try to become… me. If anything a key takeaway for me is kind of the opposite; that it doesn’t matter if other people think I’m “successful”.
Agreed. The example from Jobs’ commencement fell flat as a way to reinforce the point of the article. That quote was inspirational rather than a template for success.
That is my favourite speech ever, and the advise about finding what you love in life and business, is a truth so real that it doesn't matter how much of a platitude it is. The author obviously gave up on this search, and now seemingly wants other people to give up as well.
Is it so hard to imagine that some people get genuinely inspired by stories of other people's successes?
Yes, some success stories are propaganda. But many others are genuinely inspiring (and have something to teach us). For what it's worth, I think this extreme take is more propaganda than most success stories.
Just knowing that something is possible is a huge motivator and a motivated person is much more likely to succeed.
In sports, it's common theme to think that something is impossible until someone does it and the previously impossible achievement becomes the new standart as more and more people start doing it.
For something to be teachable it must be reproducible to some degree. Because the number of failures is hidden, it's impossible to know what actually works or not. You're only seeing the numerator and not the denominator too. That's why survivorship bias is so important.
> I think this extreme take is more propaganda than most success stories.
Success stories are not propaganda in the sense that they are false stories you would be convinced to believe. They're propaganda in the sense that hearing them influences you to believe in the economic system itself and then spread (propagate) those stories to others.
Whether or not she agrees with the overall goal of the campaign, the individual piece of information can be true ( or unverifiable). Much of the most effective propaganda is about missing or misleading context, not false information. This is the context of the parent comment, not the campaign.
Isn't that the explicit purpose of propaganda? Why do people get so hung up on delegitimizing the outcome of anything stuck with the label "propaganda"?
Success stories in capitalism are usually heavily censored to hide the trail of wrecked careers, shady dealings, and invisible nepotism that occurred along the way.
If you want to know the truth about a company, ask its least popular member... or, better yet, someone who was fired.
When I was interviewing most recently I always included a question along the lines of “what do you hate here?” And while I didn’t ever hear about firings, I did often hear about issues that regular workers saw in their company. It was enlightening.
Tonight I went for a walk with the 15 yo son of my neighbour who said he wants to start his own company and have 1 million by the time he turns 18. I asked him, what do you have in mind? He said, I want to build a company that is cash positive and then reinvest its profit in itself and grows.
I told him this really does not mean anything. You need to have concrete steps toward this goal which is only 3 years away.
I think those who really wants to achieve the so-called "success" will just go figure it out rather than constantly reading those success story. Yeah perhaps at the very beginning of the journey you get inspired by reading a few of those.
But the rest is basically taking concrete steps and trying stuff out until it sticks. And the best way to do that is to go figure out HOW those people in the success story did it.
I mean, it kind of makes sense. These kids aren't stupid. They see that most of the upward mobility ladders have been pulled up by the last generation to climb them, and there's not much left besides gambling on meme stocks, OnlyFans, and trying to become a popular streamer.
They look at their Millennial parents generation and say "Why would I want to study hard, go to college, and work my ass off? That's what you did and you have six figures of debt and work at Starbucks!" We were suckers and believed in class mobility. I think the next generation of kids are more observant and cynical and have figured out the deck is stacked against them.
Yeah that's exactly right. I'm 42 and my wife is 26 and she and her brother (23) are very keenly aware that the deck is stacked against them from the get go. Their early internet consumption mostly consisted of them informing themselves of their odds in the world. And they were horrified with their own conclusions. They kept saying "it couldn't be that bad, could it?". And then they tried to find entry level jobs on the local market...
They are not lazy. They simply are on the lookout for an opportunity that's worth their energy. And truthfully, 98% of them out there are not.
Mind you, this might still end horribly for them because IMO at some point you have to start working your ass off since that at least carries some potential to open opportunities for you (get acquainted with people, for example).
But I definitely understand why they are the way they are.
And I know at least 15 other young people who are on the exact same mindset.
It's indeed an evolutionary process. They're born in a different environment compared to you and me, and their priorities are different.
There’s a lot of negativity towards capitalism here in this thread which is hard for me to understand when the average Hacker News user is upper middle class chatting away on social media in the middle of a work day. It seems like capitalism has done exactly a great job in lifting people out of poverty and continues to do so.
A lot of the negativity simply comes from being detached from real problems, in my opinion.
I've got no idea about the general demographics of the site, but I for one am here in the middle of the day because I'm unemployed, not because I'm well-off.
There have been many people trying to get rich quick in previous generations, as well. If it's growing over time, faster than the "work hard and rise to the top" or other segments of the population, it may be because "working hard" in the same kinds of jobs (level of skill, amount of effort required, etc) people were doing 50 years ago is much less likely to get you to the same level of independence and wealth that it would have 50 years ago.
I think this entire discussion is more about opportunities and the common debate is between older generations that think young people have the same opportunities now that they had when they were young VS young people now believing they do not have those opportunities. I mean, is this not the basis for the entire "OK, boomer" response/meme?
When looking at specific success stories, I think the people talking about luck being opportunity have the right of it. Sure, there might be some plan old luck involved and there's surely a large amount of persistence and effort involved, but it does seem rare to hear about what created the opportunity for the success.
Everybody talking about survivorship bias are really talking about how the success story, as told by people involved in the success, are rarely looking to download their involvement and talk about the opportunities they had, but instead want to show how their involvement and the things they did are the key to the success.
(Without knowing the person at all), I would have asked, 'why?'. Lots of kids these days seem to be just following these paths blindly. A million dollars can be a means to something; it's not a goal.
'kids these days' - maybe this was always true, but it seems like they are trapped in a cycle of trauma, thinking life is a struggle to survive.
Your neighbour's son is likely going to be quite successful at least on some level, and he may even get to his $1M.
"It doesn't mean anything" - the opposite, it means a lot, it's 'a (personal) goal' - which is how people focus and motivate themselves.
"the rest is basically taking concrete steps and trying stuff out until it sticks." - well kind of. Yes, you have to 'take steps' at some point, but 'what steps?' to 'what end?' etc. etc..
I think it's probably slightly more beneficial to have people focused on growing the pie, and having a nice way to captures surpluses, as opposed to just "I want to make money" but just having the later is a formidable goal.
You, shall we say, "had a learning experience" if it's 2022 and your son still believes in capitalism.
Maybe it's too late for us old farts, but the generation coming up needs to overthrow the corporate system--and they need to start while they're young and have the energy, and the best of us oldsters will be around to help them, so there's no time like the present--if they want to have a future. There is none in the current socioeconomic system, not for real humans (as opposed to ultrawealthy ghouls).
Over the centuries, they spread from England to the rest of the world because they play an important role quite well: they allow people to pool their resources for a common project while protecting their non-invested personal assets from potential bankruptcy.
People want to do business. People want themselves and their families to be protected from utter financial ruin if their project fails and ends in bankruptcy. People want to maintain some kind of continuity in businesses even if an important individual dies or becomes incapacitated.
Legal personae - corporations - are the solution to this set of requirements, whose functionality has been tested by centuries. They will outlast us for this reason alone.
Hey, let them be inspired, even if it is propaganda.
If there is anything to be done, is to help people differentiate speech that motivates versus a speech from a motivational speaker. For example, Steve Jobs told his story and it motivated a whole lot of people. I'm sure many people in this audience felt an jolt of inspiration when they watched that address.
However, when you finish watching a speech and you are told that this is only a glimpse of what is possible, and the rest is available in a 6 weeks program that will help you achieve your full potential... Now that's a different story.
In a past life, I spent each Tuesday watching a "successful" business man tell me that I can do it too, all I had to do was buy their book. One day, one of the most famous of them, who was allegedly a millionaire and the most popular Survivor in the tv show Survivor, came to present. His microphone was left on while he was backstage... The host was shouting as hard as he could to drown the sound of the celebrity asking his wife how much they made from ticket sales. Then he borrowed $15 from her for gas.
Contrast that with me listening to steve jobs speech and I felt motivated to keep working on my tiny javascript project. I haven't invented a new iphone, but at least it pushed me to work harder and make a career out it, lifting a family of 7 out of poverty. Yes, their are many more variable, but I certainly felt inspired listening.
Success stories would have been mostly accurate in prehistoric times. In a tribe of a few dozen people, it's quite imaginable that one person might be able to "disrupt" the status quo through singlehanded grit, determination, or heroism.
But these kind of narratives are a poor fit for the complexity of our modern world. Even without considering the issue of deliberate propaganda, it simply isn't possible in practice for a modern citizen to wrap their mind around all relevant factors that led to success or failure.
Maybe the moral of the story is to never allow yourself to wallow in self doubt because you don't measure up to any given success story. On the other hand, do allow yourself to use an inspiring success story to spur you into action when the time is right.
Maybe this is just moving the goal posts. After all, it seems to imply that there is some unknown mechanism at play that guides a person into a moment of opportunity. The question then becomes, "What is the nature of that process?" As far as that goes, I'm sympathetic to the idea that a lot of it just comes down to dumb luck. However, to me that's more a reason to just take a deep breath once in a while and quit freaking out than to throw up my hands and declare, "It's all fate and I have no control!"
To put it another way, you can still take some general wisdom from advice about success (as opposed to failure). Just don't take it too seriously. Use it to give yourself a little mental space once in while but otherwise try not to burn too many calories pondering it.
I've always felt that a collection of deep analyses about entrepreneurial failures would be more valuable than any success story. One of the reasons, I find startup school useful is that, it seems like the advice is based on observation of failure, rather than success alone. I wish more individual (suitably anonymised) information could be provided for further research.
While I agree with the sentiment, I think this text is pushing it a bit to far. There exist mathematic, cultural, psychological and anthropological truths that can help one navigate towards success in the world of humans, it's not all random noise.
For example:
1. Getting yourself organized and goal oriented, focused on what you can control, your behavior and decisions, instead of wasting time fantasizing about the lives of great men and the myriad ways your environment differs from Silicon Valley in the 70s. For example, a simple tool like the "Getting things done" methodology helped me to increase my productivity significantly. Some other tool might work for you, as long as you can stay on goal and deliver.
2. Understanding the exponential curve and the power of compound interest. Wealth is built by capital accumulation via compound interest, you start with just your two hands, reinvest the proceeds in growth and watch you empire grow. Once you accumulate seed capital, everything becomes easier, money is like a superpower and you can direct people around you to work towards your vision.
Cultural norms are strongly favoring linear career goals, ex. becoming a doctor, so it's very hard, risky and counterintuitive to go against your peer group and position yourself on an exponential growth path.
3. Understanding people are political animals, always competing for power and resources. This is true for any organization, team, project, people will obey power and getting and wielding power is a complementary goal to money, one leads to the another. A strong way to accrue political capital is to build networks, meet and keep good relations with many powerful people that can be useful and for which you are useful.
These examples are some very general and powerful concepts that are likely to remain true for a long time and that most successful people use at least instinctively. They are necessary to greatly increase the odds of success, but of course, vastly insuficient to guarantee it.
Like Louis Pasteur said about his scientific success, "Chance favors the prepared mind". Luck is important in providing opportunities, but if you aren't paying attention, you'll miss them.
This article is so accurate, I always have the same seed but haven't got the right words to express that. I mean how many people in the world work hard, a lot, but only a minor part of them get success stories. In the sport, the same a lot of athletes work as if is no tomorrow but only a minor part of them will get the popularity they deserve. We need to just prepare that hard work does not always get its fruits.
There is a worthwhile premise behind the title of this article. Success stories are generally fluff designed to rewrite history and control a desired narrative.
Most the real reasons for success are taboo, boring and too technical to talk about, e.g. "we got massive SEO traffic through user-generated content and 10x'd traffic in 2 months"..
One of his examples of the importance of not focusing on success is actually a success story; he just conflates the path to success with the content along that path. That might sound confusing, so consider two ants that go to find food. One ant does it by crossing over an area where a plane did not crash. The other finds food by going over an area where a plane did crash. They both report back the success story - a pheromone trail that describes their respective path to success. The content along that path and the path itself are separate things. Just because the content on the path to success involved reasoning with regard to a plane which just so happened to be crashed doesn't mean that communicating expected value of paths in general is refuted. Otherwise the point is self-refuting, since it argues on the basis of a path description which has positive expected value that path descriptions of expected value are inherently flawed.
Or, "I'm fully self-made. All I had was an introduction to the CEO of Sequoia by my father who happens to be a Senator and a small zero-interest loan, barely a million dollars."
I encountered a founder once who built his small empire from just an idea in a garage. How did the employees know it started as an idea in a garage? Because he started every speech at every company meeting by telling the story. But if you dug just a little deeper, you'd learn that this was like the fourth or fifth startup he tried. Every time one failed, he'd go back home, live off his family's wealth for a little while dreaming up the next attempt.
Yea, I could also be a pro baseball player if I got an infinite number of at-bats.
> Lucky for a start that he was born in the US not, say, the Congo.
The US was created by its citizens. Any country can do that.
As for Steve Jobs, I worked for a company in the 70's that had everything Jobs had - and much more. It could have easily become what Apple became. But what was missing was the company didn't have a Steve Jobs that had the vision to create what Apple created.
I'm sure there were many, many contemporary companies in the same boat - unable (in retrospect) to see their hand in front of their face.
I had many opportunities to become a billionaire. I didn't not because I was unlucky, but because I was stupid and unwilling to take the risk necessary.
> The US was created by its citizens. Any country can do that.
Every country is, in aggregate, created by some portion of its citizens, but I don't think that necessarily implies every country has an equally plausible path to the positive social conditions of the US (in fact, it's an open question if the US has a plausible path to keeping its positive social conditions). There was a very narrow window of conditions that applied where enough enlightenment thinking, reflection on classical thinking, local colonial strength, and enough self-interest for a broad number of colonial Americans met a concept of the public good, and we still got a union that needs a hell of a lot of perfecting. If you take the culture of the early 19th century US and backport it to the late 18th, I'm not even sure you'd get anything half as enlightened.
The point isn't that people shouldn't try, of course. The point is that even the state of a given functioning industrialized democracy is partly a matter of lots of factors that no one has control over, which makes it reasonable to describe them in terms of luck.
> I had many opportunities to become a billionaire. I didn't not because I was unlucky, but because I was stupid and unwilling to take the risk necessary.
It is wise to realize when one has lost a roll of the dice because of a passed opportunity to cast them. It's also wise to realize that luck would have played a role if you'd taken the opportunity.
Why is it wise to have a negative view of opportunities that present themselves?
> that needs a hell of a lot of perfecting
It still works better than any other system. It wasn't that many years ago where what to write on bathroom doors bubbled up to get the attention of the US President. Or the fake crisis that there are many very rich people in the US. Or the drama over who is bending the knee and who isn't. The fact is that many of our headline problems are trivial when put in historical context.
> Why is it wise to have a negative view of opportunities that present themselves?
Recognizing that luck plays a role in the outcome of opportunity isn't a negative view, only an acknowledgment of what can't be controlled alongside what can, much like the one that you made tacitly when you used the term "risk."
> It still works better than any other system.
If we're speaking in general terms about market democracies, I sure know I like living in one, and yes, people living in most of those (including the US) could stand to appreciate how some things are actually working relatively especially by historical standards.
On the other hand if we're speaking in specific terms about countries, there are others which get notably better metrics than the US on things like the economic freedom index, high net worth individuals per capita, life expectancy per health care dollar spent, or bankruptcies per capita, which indicates some pause about how strictly to regard "better than any other system" and further room for optimization that clearly has substantial positive impacts on quality & length of life elsewhere.
The US was also created by its geography. Lots of space, lots of natural resources, etc... Even the best people can't make gold out of nothing, so to speak.
Everyone can be the US sounds a lot like the Mitt Romney "I couldn't pay for college, so I sold some of my stocks to pay for it" [0].
It's quite out of touch to be born in the richest country and then be surprised why other countries can't make it. It "takes money to make money". Thats not the only criteria, but it helps quite a lot.
> > Lucky for a start that he was born in the US not, say, the Congo.
> The US was created by its citizens. Any country can do that.
That's a very strong claim. Are you saying that Congo just doesn't want to be prosperous? That every country that isn't currently the richest in the world just... didn't decide to be become the richest in the world?
The path they chose is one that does not lead to prosperity. There's nothing inherently wrong with Congo or the Congo people.
What I find most sad is how few people want to emulate the United States, and how many want to emulate disasters like the Soviet Union, Cuba, Venezuela, etc.
>The path they chose is one that does not lead to prosperity.
You're playing games here with 'chose', the US didn't choose to be a super power, they were an irrelevant sugar colony who lucked upon the stupidity and self-destructiveness of Europe (from Napoleon to Hitler) and a continent-worth of land whose inhabitants are easily devastated by old world diseases. I don't think you can attribute this to any choice or planning on part of anyone, at every single point in history the actions and incentives of people are fully explained by a simple distributed greedy algorithms, choosing to maximize things that turn out to be wildly wrong in retrospect and not what the children of the next generation want (which is also wildly wrong and not what the children of the next generation want, which....).
Even in a perfect information game like chess a single mistake can doom you, even in perfectly mutable, free, abundant and error-correctible computers a single bad state can (and often does) cascade into a failure that requires nothing short of full restart. Life is orders of magnitude worse than those 2 (perfect!) systems. Life is multi-way chess where the descendents of the players continue the game for them. You don't choose paths, they choose you. People hundreds of years removed and thousands of kilometers apart doom and bless you into fates beyond your comprehension.
What happened in South America? Compare the US to South America over the last 400 years in the light of your statements.
Also compare with Japan and Germany, both of which turned to free markets after WW2 and became quite wealthy. Japan in particular has no natural resources to speak of.
I see a borderline failed state. The fact people are rushing there from other failed states is no signifier of confidence as far as I’m concerned.
Generally I see it as a warning sign for western ideals, and a great tragedy waiting to unfold if the shit hits the fan.
When pressed, I’ll express my concern that a population of people who have had it so good for so long have done so little to agree about what it means to be human and autonomous and as a result have completely failed their founding fathers.
"The path they chose", i.e. they deserved it? Also the Democratic Republic of the Congo (in comparison to "Republic of the Congo") was fiercely anti-communist [0] and backed by the US, so I guess that didn't help them with their prosperity either.
The airplane bullets story actually shows how success stories can be valuable. If you take them in aggregate and look at what's not there, there are some common themes:
- No one ever says they gave up
- No one ever says they wasted time on petty distractions
- No one ever says they saw a great opportunity and passed on it
That says more about the framing of success stories than anything else. When your third company sells for seven figures, you get to say your first and second were learning experiences rather than things you had to give up because they weren't going to succeed. When you're a unicorn, you get to build side projects or embark upon codebase rewrites involving more people than most companies ever hire, and people will praise both your desire to explore new ideas decisiveness when you fire them and shut them down rather than dismissing it as a petty distraction (and something you gave up on). And the most successful startups get to say all the many investment and acquisition offers and commercial deals they passed on weren't great opportunities, and have reason to even believe it.
If we're doing airplane bullet stories, it's like trying to figure out how to fix airframes by looking at the aircraft that didn't get hit at all...
No one ever says they saw a great opportunity and passed on it
I had the opportunity to buy Bitcoin in 2010 and didn't. I was simultaneously correct (about the moral value and nature of the thing) and utterly, utterly wrong (about what it would do between then and zero, and thus from a personal financial standpoint).
I had too much faith in humanity to invest in Bitcoin. Whoops. Turned out degenerate nihilism was the winning bet.
This is what I felt reading Steve Jobs biography, this guy was a maniac. But all the internet right now holds him as the most motivational figure, and biography changes life. It's just bullshit.
Attributing most success to luck also doesn't seem to be very productive. What's the end goal?
If your end goal is to put down the success of others and make yourself feel better for not achieving the same level of success, then I guess this article is great for that.
However, if your end goal is to maybe one day be as successful or more so, then IMO this article isn't that useful. I strongly believe in the saying that "experience is a poor teacher," and in that case it's worth seeking out the successful experiences of others even if it's not an exact template we can follow.
Old man, dying, calls out to God, "Why couldn't I at least win the lottery?"
And God says, "Why couldn't you at least buy a ticket?"
People complain because there isn't a formula for success and the propaganda stories promise one, but don't deliver. It's not their fault that they don't deliver, because no one can. It's your fault for even thinking there was a formula. And it's their fault for encouraging you to think that.
> focusing exclusively on say, the successful lottery winner or the successful weight loser not only obscures quite how hard success really is to achieve, but all too easily oversimplifies or misrepresents the real reasons behind success.
So, is the issue success stories as such, or inferior analysis?
These stories, and self-help books in general, are so much comfort food for the alfa-male mind.
Of course people want to ascribe agency to success, and necessarily failure. The flip side of luck is fate.
Just look at the success of ideas like predestination and physical determinism vs. free will in the "marketplace of ideas". Many people really don't like it when you strip them of agency, no matter how flimsy the story told to fill the void.
This is a pretty good article. But I don’t think it is fair for him to say we learn nothing from heroes. We are not alone. Heroes do help us— propaganda or not. The author lists all the ways Steve Jobs was lucky. But everything he list only narrow it down to a couple million people who could have done what he did. Yet only a few did.
Success is something that tends to be propogated when being communicated to the masses, but success is such a general word. Success isn't a one size fits all. It can be as simple as passing a test in school, graduating said school, paying off your mortgage/debt.
Anybody can get lucky, but most people aren't prepared to get lucky in the way they want and don't know how to capitalize on it when they do. That's where the skill comes in.
For some evidence proving Martin Weigel right, see the BBC show Dragon's Den. Fix rich, self-righteous turds who think they are self-made billionaires bet on business ideas entrepreneurs pitch them. They never bet on the winners and frequently bet on losers. Literally millions of people could do the job better than them but where not lucky enough to get right. The best product ever pitched on the show was the Tangle Teezer which those business geniuses unanimously trashed: https://www.youtube.com/watch?v=s2O0SvrlFKA
This idea ("almost everything is luck") is not exactly rare. But the author has a giant blind spot when he cites the story of Abraham Wald while ignoring a glaring case of similar gap in his own argument.
There are tons of people who had all the luck in the world and they didn't achieve much at all.
Just look at his long list of all the lucky circumstances that Steve Jobs had to encounter ("he was born in the USA", "GPS was funded", "all the necessary technologies necessary to create an iPhone already existed").
True, but Steve Jobs wasn't the only one who had this kind of luck. Most of these conditions are wide enough that, in their intersection, there were at least several million other individuals whose activity didn't result in anything remarkable.
At which moment we are back to square one. Was Jobs' life story a propaganda? Perhaps, but if you want to recast it as an end product of several instances of luck, you need to explain all the duds too.
An interesting example is Elon Musk. Whenever Musk is discussed on Reddit or on HN, there is a glut of forists who explain that someone born into this kind of wealth and privilege simply had to be wildly successful.
But Musk's own brother Kimbal, who grew up in the very same family and environment, is barely known.
So, 300x less than his brother. Quite a difference. Two orders of magnitude are a lot. The gap between those two is as big as a gap between Kimbal and a random person who inherited a nice home in California worth about 2,5 million, but has nothing else of value.
And it’s another similar multiple drop to the average American. I’m not sure your point.
Musk is an outlier and we will never know who would have held those positions if he didn’t exist. On the technology front I’d argue it’s far more likely we would be equivalently close to self-driving EVs than not.
In my experience billionaires are unique in their proximity to money and relative desire to accumulate wealth, and their lack of attention or concern for anything that does not serve this outcome.
If they are inherently unique perhaps it is because they cross-wired the evolutionary modules for threat detection and scarcity avoidance.
My point is that explaining away outliers as a result of a long string of random positive events is as unsatisfying as elevating them to some superhuman status.
I find the idea of "they are what they are because of pure luck" intellectually lazy, unless it is well supported by statistics - which is something that Nassim Nicholas Taleb did for so-called superstar stock exchange brokers.
It isn't "just" propaganda. A success story is fundamentally a communication that relates to positive expected value. Picking examples might make it seem like success stories are just propaganda, but you can trick yourself with biased sampling quite easily.
Consider a different example of a success story: the communication of the presence of food by ants to other ants. A fundamental part of their thinking is tied up in the idea of communicating these successes. For them, it isn't "just" propaganda.
Interestingly - we've had something close to a controlled experiment about the viability of not communicating what we think success is with humans. There was once a theory that if you didn't tell anything to another human they would learn a divine language. To test this a child was separated from the general population and raised with caregivers who did not speak to them. As you might imagine, this did not produce a divine language or an especially intelligent child. It produced a feral child.
In actuality, I think you can relate communication of expected values back to a solution to a foundational problem and dialectic tension in learning problems in complex environments: the explore exploit problem. The literature calls these multi-armed bandit problems.
Social species, such as ants and humans, use communication about expected values to make their search over their reward landscape more effective. Actions are conditioned on the outcome signals communicated through the environment, creating a kind of lookup cache of better than random strategy.
So there is something deeper going on here than "just" propaganda.
If I'm right about that, a natural question is to ask "why would people conclude it was just propaganda" and I'll skip the obvious reason that the phrasing feels wrong and so the author just did it to attract attention.
This property of valuable utility information in expected value calculations makes sharing success stories high utility. However, some people are low utility producers and want to signal being high utility for various reasons. So there are going to be some success stories that are fabricated. We have a lot of people. So we have a lot of people sampling from stories and some of those people are going to draw samples of stories where propaganda really is the best description.
So you can arrive at this belief without needing to be attention seeking and then what happens when you test it? Well, it seems right - there really isn't guarantee of success.
Unfortunately, separate to this is the actual viability of following advice gleaned from success stories. To see why it can help to go back to a simple case, like an ant following the high confidence pheromone trail. It may indeed not find food at the end of the trail, but that property has a lot to do with the environment. It isn't fully a thing about success stories, but a property of how hard problems can be. They probably wouldn't be better off abandoning the use of pheromone trails.
This becomes more obvious when you start giving great examples of success stories. For example, when people comment that mathematics was useful and encourage that we teach it, should we conclude that the success they derived from it is "just" propaganda?
Or how about recasting their own great example of a great success story - they relates a success story about how people managed to infer something about failure cases. Their argument about why to focus on failure actually contains a sub-component - the success story of focusing on failure. By their own logic, we ought to conclude that their story was just propaganda, but this seems a bit harsh and I think it would be missing the point they are trying to raise.
Anyway, this has gone a little long and I suspect this won't be a popular opinion, because it is easy to misconstrue it. Some people will probably think I'm saying that the lucky ant who reports a great success wasn't exploring the landscape and didn't get lucky. That isn't what I'm saying. I'm just trying to talk about what is "underneath" success stories in general; why we tend to pay attention to them, maybe more than people feel is appropriate.
