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> One of the great benefits of business school is meeting entrepreneurial people.

Sadly, this puts the article into perspective right from the start. Not to put BS people down, but this is going to be a very limited perspective on the goals, dangers, and prospects of doing a startup.

> Is a cupcake shop making $100k successful? Depends on the owner. If his alternative is a $65k factory job, yes. If he left a $250k legal job to do it, no: the business destroys $150k of wealth every year. Yikes!

I can think of any number of reasons why it might still be a win. You might be much happier making a 100k with cupcakes than spending your life doing soulless lawyer things. You might make amazing cupcakes, enriching the world around you. Your legal job might be a dead end. You might feel that life is short and you want to do something you like. You might want to experiment. You might have a really cool idea for a cupcake shop concept. And, technically, no wealth is destroyed at all.

> I have no problem with someone going this route, but it doesn't make sense for me: my lifestyle would not be improved by working more hours for less money at greater risk.

If you're not willing to work more hours for less money at greater risk, my intuition says you're probably not going to create something really outstanding either. If immediate and assured rewards are what's driving you, keep going up the corporate ladder because this is exactly what your personality type warrants. But without taking risks, being creative, occasionally working your ass off, and potentially failing sometimes, your chances for achieving greatness will also be significantly reduced.

> Corporate can be fun.

That depends on your personality. With everything stated so far in the article, yes, corporate is the way to go for you. Other people? Not so much. Going corporate is not intrinsically fun, and nothing else is either for that matter. If an environment fits you, chances are you'll thrive there and find fun in it.

> Value gets us paid.

That depends on your definition of value. Clearly, I would say the danger here is the tendency to simplify this, by assuming pay is always tightly coupled to value, and hence the value of something can be derived from looking at the wealth of the person doing it. Which is a bad path to be on, in my opinion.




The only point that this guy has is that working for a big corporation is a safer average payout than starting your own firm.

Paraphrasing the logic: the 10,000th engineer at Google adds more value, which is why he is paid more than the average startup person. It's a meaningless statement. Google has a magical core business, which the 10,000th employee had nothing to do with. the core business throws off a lot of profit, which allows them to pay for all kinds of stuff. There's just no way to say whether the marginal Google engineer creates more value than the average startup, and using salaries as the sole benchmark drives us to lazy conclusions. Most likely, the google engineer is working on something that will go nowhere - perhaps it is Google Wave! - but the company can afford to overpay him for his trial-and-error, because search has a >25% operating margin.

If anything, the average startup, even the failures, contribute more value in the sense of social outcomes because we have a massive decision tree of trial-and-error of all the possible permutations of business. Some of them work, some of them don't. (...important that we try...)

> Corporate can be fun.

I am chuckling that this is a Bloomberg guy who is way into the culture. Depending on who you talk to - others describe it as the most political, micro-managing environment they've ever experienced. I don't think it's a particularly innovative company at this point, but like Google, they have a magical core business, basically a monopoly on a segment of financial terminals, which allows them to do all kinds of ridiculous stuff. Does the 10,000th employee of Bloomberg add more value than the average startup? No, chances are he's trying to figure out how to copy a competitor - with a 5% chance he's doing something legitimately new - but the company makes so much money on other stuff, they can afford his efforts.

The reality of major corporations is that the strength of their legacy businesses allow them to throw off a lot of cash and their employees don't need to do that much to improve the situation - they just jockey to make sure they are the one who gets to sit in a big chair. M&A is a huge factor in the long term positioning of major corporations for this reason - swallow the competition.

Procter & Gamble uses MBAs to figure out how to shrink a toilet paper roll while raising the price by $0.05. Is that innovation, or "value", that's objectively better than even a failing startup? Probably not, but they can afford to pay.


A point he tried to make later on but wasn't very clear is that value is more than just money, and might be subjective. This is basic economics, everybody has a different value function and they may value the smart coworkers at a good corporation at $100k/year. They may value time spent with kids at $10M/year (I know I do). When you put numbers to those things the outcome is basically completely subjective.


> I can think of any number of reasons why it might still be a win.

You write all that as if the next few paragraphs didn't have all those caveats already.




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