Have you ever gone as frugal as this to speak about it? And what would you suggest the "generation of fools" do otherwise? Get a 50k job at a big company and live happily ever after? Too much hate in that comment. (edit for grammar/typo)
If you want runway, try not living in California for a while. Even in the US you can find far cheaper than Palo Alto...
This is shocking? California (and New York) are some of the most expensive places to live in the world. The US is a big country, and many great places here are but a small fraction of the cost to live (Pittsburgh, Houston, Cleveland, etc...).
I can get a huge apartment in Pittsburgh for the same amount in rent as it costs to park my car here in SF.
Even in urban/suburban Northern California, for that matter.
I've been living a relatively frugal lifestyle for my entire life. Getting smart about expenses and staying that way are the surest path to financial independence.
The best advice is to disconnect your expenses from your revenues. If you make $10K more per year, don't let your expenses creep up as well. Just sock it away for a rainy day. One day you'll look back and see that you've saved up enough to pursue whatever dreams you'd like.
> And what would you suggest the "generation of fools" do otherwise? Get a 50k job at a big company and live happily ever after? Too much hate in that comment. (edit for grammar/typo)
Most startups fail so my default advice is for people to get "normal" jobs and just save up money. It's not as sexy as starting your own company but it's a known plan that works. Along the way if you come up with something as a side project and it works out, great.
By all means pursue a start up full time if you think you've got a decent idea for one and the means to do so. But there's no reason you have to live in a closet.
Judging by your profile info and comment I assume you haven't previously started a company on your own from scratch (yes/no?). I think this is where the difference of perspective comes from. You are viewing starting a startup vs. getting a job as a zero-sum game where it's all about dollars and cents.
The article specifically is not "romanticizing" or "endorsing" living in the closet. We are all in this life because we want a better future for ourselves and the people around us.
The reality of startups is that rent initially is your biggest cost. The author literally has one sentence about the closet/rent facts - it was the most effective way to maximize their runway.
You're statistically right that most startups "fail" but why? I've started a number of startups (only one I would consider a very small success) and I have also observed many startup around me. Very often the reason why startup fail are:
A) People/founders give up B) Running out of cash or coming too close to it after raising money and increasing burn to unnecessary levels.
One curious story here is how a startup started at $0, and initially raised $50-100k. They thought they are at the top of the world (aka "we can go on forever on this money"). They ended up raising almost $1M and within 1.5 years they burned down to $50-100k. And they gave up. In reality they could have kept going for at least 6-12 months or tried exploring options like raising more, etc, etc. Emotions are very often stronger than logic in many aspect of life, especially startups.
The big problem with "the American" (read "most of the developed world") way of living/culture is that it normalizes and in many cases strongly endorses the presumably safe path. In reality, there's no safety and nothing is guaranteed. Your safe job that you spent years in building a career can go away and unless you're in engineering I have seen cases where you're very unlikely to find similar compensation at another company. The reality is that you're much more at the mercy of forces beyond your control when you're employed somewhere that you'd like to believe. And finally, starting a company does not mean "not paying yourself" or "not saving". If your company is doing objectively well, you should be paying yourself a salary.
You also refer to the notion of a "decent idea" but there's a big problem with that adjective/noun combination. The reality is that you almost never know if it's a good idea until you truly apply yourself to the idea for an extended period of time. The initial idea will also very likely change a significant amount. Many of the stories your read in the press are the one week/month wonders but I think the majority of startups took years of hands-on work to get to the recognizable status they have today. Just to name a few, and I won't elaborate on their stories: TempleRun, Pinterest, AirBnb.
And one final thought: you present living in the closet as an absolutely terrible thing. People have endured much more strenuous circumstances and have "come back to tell the story".
> Judging by your profile info and comment I assume you haven't previously started a company on your own from scratch (yes/no?).
I've worked at large faceless corporations, started my own company, and at times done both in parallel.
> I think this is where the difference of perspective comes from. You are viewing starting a startup vs. getting a job as a zero-sum game where it's all about dollars and cents.
Nope I've seen this from multiple angles.
I suggest creating a viable private enterprise (i.e. startup / side business / etc) to all my close friends as a long term means to true financial independence. It's not a zero sum game at all. In fact, I see working at an existing company as a great way to find opportunities that need to be solved, expanding your skillset to cover new technologies, and providing overall stability that can be leveraged to pursue your own thing.
> The article specifically is not "romanticizing" or "endorsing" living in the closet. We are all in this life because we want a better future for ourselves and the people around us.
Any article that doesn't call out living like that as a bad thing (even if it's a means to an end) is doing a disservice to a world of wide eyed youth.
> The reality of startups is that rent initially is your biggest cost. The author literally has one sentence about the closet/rent facts - it was the most effective way to maximize their runway.
It'd be even more efficient to live somewhere else. There's no reason they had to be in the bay area.
> You're statistically right that most startups "fail" but why? I've started a number of startups (only one I would consider a very small success) and I have also observed many startup around me. Very often the reason why startup fail are:
> A) People/founders give up B) Running out of cash or coming too close to it after raising money and increasing burn to unnecessary levels.
> One curious story here is how a startup started at $0, and initially raised $50-100k. They thought they are at the top of the world (aka "we can go on forever on this money"). They ended up raising almost $1M and within 1.5 years they burned down to $50-100k. And they gave up. In reality they could have kept going for at least 6-12 months or tried exploring options like raising more, etc, etc. Emotions are very often stronger than logic in many aspect of life, especially startups.
> The big problem with "the American" (read "most of the developed world") way of living/culture is that it normalizes and in many cases strongly endorses the presumably safe path. In reality, there's no safety and nothing is guaranteed. Your safe job that you spent years in building a career can go away and unless you're in engineering I have seen cases where you're very unlikely to find similar compensation at another company. The reality is that you're much more at the mercy of forces beyond your control when you're employed somewhere that you'd like to believe. And finally, starting a company does not mean "not paying yourself" or "not saving". If your company is doing objectively well, you should be paying yourself a salary.
> You also refer to the notion of a "decent idea" but there's a big problem with that adjective/noun combination. The reality is that you almost never know if it's a good idea until you truly apply yourself to the idea for an extended period of time. The initial idea will also very likely change a significant amount. Many of the stories your read in the press are the one week/month wonders but I think the majority of startups took years of hands-on work to get to the recognizable status they have today. Just to name a few, and I won't elaborate on their stories: TempleRun, Pinterest, AirBnb.
And that's the point. It's the work that matters. Not living like a hobo.
> And one final thought: you present living in the closet as an absolutely terrible thing. People have endured much more strenuous circumstances and have "come back to tell the story".
People having done something and survived doesn't mean it's a good idea to do so. It doesn't even mean they're necessarily related (correlation, causation, and all that jazz...).
I'm saying to differentiate between risks and hardships that are required and those that are pointless (or more accurately without a valid risk/reward basis). I see living in a closet to further a startup idea in the latter category. Maybe being in a tech center was required 20 years ago but it's definitely not true anymore (unless your business requires in person interactions with people in that tech center on a daily basis).
By all means pursue your dreams, but there's no need to pursue them like that. Be smart about it.
Best advice I've heard all day :D