> One thing that I’ve found puzzling over the last ten or so years is the anger directed towards people who choose to work hard
That feels somewhat disingenuous. If 'sama is referring to the sentiments expressed on this board, from what I've seen, it's not anger towards people choosing to work hard, but anger towards demands of hard work of others from those who stand to benefit at their expense.
Ie, the anger is towards VCs who talk glowingly of start-up founders working themselves to the bone and, in turn, towards start-up founders who talk glowingly of 0.01% equity-holding employees grinding out hour after overtime hour.
Certainly working really hard without an expectation of being compensated it (either with equity or cash) is dumb. I've argued a lot that startups should give employees more equity, and I think that's shifting. Also, most startups I'm aware of, at least in the bay area, pay large salaries at this point.
I'd have to disagree. At least based on my definition of large and my experience interviewing in the Valley.
For example: If you're making X amount of salary and paying $1500 for a one bedroom in Big City Y, you'd have to make at _least_ $24k more in SV if you wanted a comparable one bedroom apartment. It's probably even more than that as I don't know anyone paying less than $3k for a one bedroom within 10 miles of SF.
For a junior dev making $80k in Austin who is moving to SV, getting that $20k bump is certainly plausible and in the above scenario would work out fine.
But what about a family of 4? They need a 3 bedroom house. How in the world is that family going to make enough to afford a house northing of $1m? How much would that person have to make to even support half the cost of their houehold? $200k? $400k? Those types of salaries just aren't happening at startups.
Not every opportunity is great for everyone; people with families generally don't like to travel, that doesn't mean that a job that entails travel is a bad one.
Having a family is clearly a choice. And having 3 kids is very different from having 1. These people will always have less material goods and have a harder time scraping by than someone with no dependants when the cost of living is high. This is true of any industry in any expensive area, it's what you should be expecting if you have kids.
In any case, the original comment is wrong about housing prices, you get shafted when you try to live right in the heart of SF, pretty much everyone with a family is going to have to commute from somewhere, you can still get comparatively cheap 3 bedroom houses in san jose, and there's still plenty of tech companies with offices in the south bay.
This is probably the single biggest factor that's keeping me from moving out to CA. There's a lot of great companies out there and I think I could learn a lot but I also don't want to go broke.
Edit: How are people making it without a really high salary or living with three other people?
I call real estate the "evil sponge." As a region becomes more affluent, the price of real estate appreciates at least in step with this. Due to the leveraged debt financing of RE, the reality is often that price appreciation is a multiple of wage appreciation.
This takes pretty much all the surplus capital in a region -- among everyone but the rich -- and locks it up in an inert asset.
Think of it this way: a starter home in the Bay Area is about a million dollars. In SoCal -- not cheap by any means -- it's more like $400k. The average AngelList seed round is $400-$600k. So every single house in the Bay Area locks up the capital required to seed fund at least one new venture.
What could all those smart people in the Bay Area be doing if all their capital were not locked up by an inert asset?
What's worse is that there are idiots who cheer this on because it will supposedly exclude people they don't like (the poor, blacks, etc.) from their neighborhoods. I read a great book called Detroit: A Biography. It explained how RE hustlers used racism to fleece people: first they'd sell a neighborhood to white folks. Then they'd pay black people to walk around in it. Then they'd scare the white folks into selling below market, jack the price back up and sell it to blacks, and meanwhile sell a further-out more expensive neighborhood to those same white folks. Rinse and repeat. I suppose if you harbor these kinds of views it's kind of poetic when they're turned around and used to con you, but it harms everyone else too.
I was hoping the housing bubble crash would bring relief, but it's right back up there. Either the entire economy needs to inflate until RE is reasonable again -- which would give us $8 loaves of bread -- or real estate needs to fall over and burn. We need something like the 2008 housing crash with no recovery-- to unshackle the real economy from the rentier asset economy.
For instance - if I bought a house in the 1990s for 200K and it's now worth a million dollars, it isn't stealing $800K from anywhere. That's new wealth that I have that I can also put to work. (Even if I don't take a mortgage out on the house, I can invest more of my other money more aggressively, if I'm paying less mortgage, or know that I have a high value asset in my home)
I think it's more appropriate to look at the monthly rent differential.
Let's say that a 1BR in Palo Alto costs $2,500, and a similar one in Austin costs $1,000. [0] In that case, there is a $1,500 * 12 = $18,000 differential. Let's double it to include how much you have to make to have that much take-home income, and you have a $36,000 per year difference. If an angel-fed startup has 3 employees, then there is a ~100K per year of effective real estate tax. (Approximately 20-25% rather than 100%[1])
The trade-off is, how much more likely are you to succeed and scale based on being in SF vs Austin?
[0] I'm basing both #s on the very accurate "Approximate the first Google result" method.
[1] One can argue that everything is more expensive in the bay area, but total cost of living comparisons are tough to do. Is it % of spending or absolute dollars? Does it depend on public schools? Quality of goods?
It's not "stealing" 800k. That would be a bit too strong. But the problem is that your 800k comes via the fact that newer entrants to the market must now take out monster mortgages. It's not wealth created, but a draw on future wealth and an increase in the interest payments of younger workers.
It's sort of a generationally regressive tax. I personally suspect that policies that protect and encourage RE hyperinflation have been pursued as a way for the baby boomers to economically eat their children.
Rent prices are also quite tied to real estate prices, so when the latter appreciates rents go up too.
Over the long term, rent usually fixes to a certain % of "All in" housing costs. (Usually close to mortgage payments plus upkeep plus condo fees)
The difference is that rent is a short term costs, so for startups they're not eating the 30 year home ownership cost, just the monthly rental differences.
It is a generationally regressive tax only to the extent that parents die with no assets left. If they die with positive assets, then the value of their homes gets handed to their kids.
The CA system is painful for other reasons. At the outset, it's a tax by people with good credit on people with bad. (You can't get the tax benefits of home ownership unless you have good credit) The bigger issue is the nature of the taxation... Because tax increases on houses can't rise as fast as the homes themselves, new homeowners pay a penalty relative to the value of the house. (If you and I both both buy homes in the same neighborhood. You paid 500K 3 years ago, and I pay 1mm today, my tax burden will be almost double yours)
There is a reason that successful, fast-developing nations such as Singapore have enacted tight controls over the ability of a zero-value-add rentier class to extract all the value from a growing economy.
Have you seen Singapore real estate prices lately? The same 2-br condo (Parc Vista @ Boon Lay, never a particularl desirable location to begin with) I used to rent for $1000/mo back in ~2005 is going for ~$3500/mo now, the building hasn't gotten any newer in the meantime, and this is actually a bit cheaper than it was two years ago.
My company relocated to San Fran a few months ago, I had to quit because moving there from Dallas made no financial sense.
Even with a massive raise my monthly savings would be cut in half (or more), and spending in excess of a million dollars on a home is way too risky (look at all the people who went upside down during the last recession). Barring something incredibly unlikely, such as the equity I own actually being worth something, I would likely have to add an extra 10 years or more to my expected retirement age if I chose to live and work out there.
Everyone is renting. Ok, I have one friend thinking of buying a house in Oakland since he grew up in in NorCal and wants to stay here.
Almost everyone has roommates (if they're single), or lives somewhere less convenient (if they're not).
Some people are skating by on rent control (still jealous of my friend's room in the mission for 1k/month).
Some people are burning through their income to fund a nice place but most people are saving their money.
personally I'm not sure how long I'll stay in the bay, so I'm not looking at buying anything atm since prices do seem insane. Seems reasonable for me to save my money while I'm young and my costs are low, seeing what the future brings.
Working too much, to the detriment of your health, sleep, family, and friendships, for any amount of money, even if you are the founder, is dumb. Perhaps Steve Jobs would've caught up with science and stopped his cancer earlier if he took a break.
I run a start-up with 100+ people. Vacations, family time, sleep - these are good and ultimately productive things. The normal person works so they can live, be healthy. They don't live so they can work.
citation: Steve Jobs by Walter Isaacson, authorized by Steve Jobs. What political agenda? I run a company and work a lot, but I think working is only one aspect of human existence and we should try to strike some semblance of balance.
I mean we all love large salaries but it's a symptom of something more fundamental namely that there are a lot of people who work hard but don't have the skills the market need and don't have the means to re-educate themselves.
It's not like everyone is getting more, it's that there is a divide where some gets more and a lot gets less.
Thats what this is all about. It's no ones fault but it has nothing to do with who works hard or not.
I suppose the sentiments of people who say "don't work hard" can vary. Many people tie working 'hard' to hours put in. I will say there are many schools of thought on this. If I am super focused and work 'hard' for 30 hours a week and enjoy my life the rest of week, how is my productivity and creativity compared to someone who puts in 70 hours? Are they really out-competing me? What does the research show on this, compared to anecdotally stating "All successful startups that I observe work hard at all hours, therefore this is THE way"? You are one of a small group of people that could make this observation. Just because that is common in successful companies, doesn't mean it is the best way.
I disagree. I think he is talking about the general 'anti-workaholic' attitude. I see it all the time and have personally been called out for wanting to work too much. I don't know enough about China's culture, but I know in America it is looked down upon to work non stop even if it is just for a few years of a person's life.
For good reason. It is both unhealthy and inefficient to work massive amounts of hours. There are multiple studies that show that overall productivity increases when you don't work over 40 hours a week.
The studies I've seen show productivity falling at 40 hours and dropping off a cliff at 50 for most activities.
I don't think the blame for the workaholic culture lies primarily with VCs, though some do encourage this. I think it's mostly a part of the cult of male ego. "I worked 70 hours last week! How many did you work? 50? Wuss! I'm so much more hard-core than you!"
People also lie about how many hours they worked. In reality they work maybe 20-40 and then do things like... uhh... hang around in here... for the other 20-40. Again part of the macho one-upmanship thing... putting on an act of working ridiculous hours to look hard.
Its a grind game. Obviously my WoW character level 70 is far superior to your WoW character level 50.
Unfortunately companies can be killed by this kind of primitive behavior when the 70 hour/week guy executes less shareholder value add than a 20 hour/week intern.
Give someone a stupid metric to aspire to, they'll max it. Might destroy the company in the process, maybe even themselves or their own careers, but they'll max the metric number, thats for sure.
I've run into this before as well, where guys will brag about how much (unpaid) overtime they put in, how early they get to the office in the morning, etc. I feel pity for them, not respect.
> In reality they work maybe 20-40 and then do things like... uhh... hang around in here... for the other 20-40
So much this.
There's just a huge level of inefficiency with working ridiculous hours on a regular basis. Just because you're engaged in the physical act of coding/designing/writing/etc. does not mean you are producing anything of value. In reality you'll probably do something that needs to be fixed a week or two down the road.
I've watched people who work till 9pm everyday. After 5:30 or 6 they mostly just browse the internet and fiddle around. In reality they should probably work from 8 or 9 - 5 or 6 and take a healthy 3 to 4 hour break and go home. Then after their evening has settled down get back into working on something for another hour or two at the leisure of their own home. This is much more productive than just slugging it out at the office with no work life balance at all.
One thing that I’ve found puzzling over the last ten or
so years is the anger directed towards people who choose
to work hard
I think there is serious merit to that sentiment. Others in this thread have made very keen observations on this all pervasive national attitude that has blanketed America in the past decade or two.
however the biggest issue facing the US is this message that excelling
isn't to aspired too, acceptance of who you are and who someone else
is is all that matters. It is a self defeating mindset. Don't worry if
you fail, you had no choice, you just can't do better. Here let us
take care of you....
And fully expecting to be flamed, I give you perhaps, the most lucid and no-nonsense explanation of how this kind of self-defeatist thinking has come about envelope the national psyche, in the form on a nice quip by none other than, Peter Thiel himself:
The countercultural in the '60s was the hippies. You know, we landed
on the moon in July of 1969. Woodstock started three weeks later, and
with the benefit of hindsight, that’s when progress ended, and the
hippies took over the country.
He adds:
Today the counterculture is to believe in science and technology. You
know, our society, the dominant culture doesn’t like science. It
doesn’t like technology. You just look at the science-fiction movies
that come out of Hollywood — Terminator, Matrix, Avatar, Elysium. I
watched the Gravity movie the other day. It’s like you would never
want to go into outer space. You would just want to be back on some
muddy island. And so I think we’re in a world where actually believing
that a better future is possible that you can have agency and work
towards a better future, that is actually radically countercultural.
That feels somewhat disingenuous. If 'sama is referring to the sentiments expressed on this board, from what I've seen, it's not anger towards people choosing to work hard, but anger towards demands of hard work of others from those who stand to benefit at their expense.
Ie, the anger is towards VCs who talk glowingly of start-up founders working themselves to the bone and, in turn, towards start-up founders who talk glowingly of 0.01% equity-holding employees grinding out hour after overtime hour.