Warren Buffett has made many successful investments for example, over a damned long period. There’s clearly skill in his story. Skill that Masa didn’t have.
> So some people are more talented than average and some are less so, but nobody is orders of magnitude more talented than anybody else.
It seems likely that in some domains, some people are orders of magnitude more talented. Assuming this is false begs the question.
I have no trouble believing that there is someone theoretically more talented than Warren Buffett who a less lucky life. I have great difficulty believing Buffett is untalented.
Buffett did have losses! And made mistakes. And you’re missing the point. I’m not arguing Buffett himself didn’t have luck. He himself has written extensively about this.
But he also had skill. Luck + skill. Why some believe it must be one or the other and not both baffles me.
* A good upbringing * Early exposure to stock brokering (his dad ran a small brokerage) * Being sent to university and having his costs covered
Warren actually made the bulk of his early money himself, I think. He ran an enormous paper route operation, and also repaired and sold pinball machines at a large profit.
He started all this around age 11 and it grew from there. He had amassed $5,000 by age 14.
But not having to take money out for university made a lot of difference I expect. It would have cut his compounding. I don't remember him getting much in the way of inherited wealth from his father though.
It's been over a year since I read his bio, so perhaps I'm misremembering. Happy to be corrected if you have specific info.
You get the freedom to experiment without fear of dire consequences, whether that's by building a paper route, repairing pinball machines, or expanding your family's business partnership to buy a textile mill called Berkshire.
If, however, you are child who has to work to put food on the family table, or pay the rent, you're playing a whole different game, one that has life and death implications.
Of course Buffett isn't unique in having the advantage of a financially stable and prosperous family and household. Clearly his entrepreneurial streak started early. But compared to the average person of his time, he did have extraordinary advantages, including a university education, and exposure to investing from an early age through is father's brokerage firm. His experience is not directly comparable to that of most Americans.
It wasn't his family's business partnership by the way. He ran his own investment fund.
Nor is is generalizable to the equivalent of that 97% in recent generations, despite their being more likely to have college degrees.
Talent increases your surface area to catch luck.
Talent doesn't increase surface area, it increases the probability of success. Wealth is the only thing that can increase surface area. See the problem here?
Whereas a billionaire usually gambles on the margins of their wealth. They definitely don't gamble with the roof over their head or their next meal, or their childrens' security. They can make any non-ergodic game appear ergodic for longer since they can survive many losing hands for far longer than others.
Basically, if Buffet's father was anything other than a US Rep and businessman, he never would've stood a chance. He would be working 40 hour weeks making someone else rich like the rest of us.
He made his early money repairing and selling pinball machines at a profit, and running a massive paper route operation. He started around age 11 or so.
There are many many people who were born as privileged as Buffet was, who got as many doors opened as he did, but there is only one Buffet. He may be extremely lucky, or he is a genius. It's impossibly hard to quantify the reasons.
> Basically, if Buffet's father was anything other than a US Rep and businessman, he never would've stood a chance. He would be working 40 hour weeks making someone else rich like the rest of us.
Mark Cuban was a counter example. Or Oprah Wilfrey. They stood a chance despite not having rich parents.
For example I go to the gym regularly (at least before the pandemic). I'm probably in the upper 10% of the population when it comes to strength. But compared to the regulars in the gym I'm below average.
A single datapoint can't prove a general claim. But a single counterpoint can disprove a claim.
It could be argued that Warren Buffet does exactly this.
Bill Gates made Windows which was used by millions of people all over the world, well he got lucky because he was born at the right place in the right time (a point made by Malcolm Gladwell).
Elon Musk/Thiel made billions, well they happen to be at the right place at the right time with Paypal. Once you make billions, then making more billions is super easy, that's not luck, but a function of wealth.
Cope - That's the only explanation for people attributing the success of other people as luck. If it's luck then you're not a failure, just unlucky, but if it's skill then you have to be responsible for your actions and failure.
You could argue that middle class to millionaire path could be described as mostly skill and focus, with the luck of not getting wiped out by a disease, jail, lack of motivation or whatever.
If anybody thinks building a Space and a Car company is 'easy' is just delusional.
Space in particular has messed up many billionair investors.
You can say it's some sort of coping mechanism, but actually I believe that most of my own success is luck. I would say I'm successful, I'm good at what I do and I'm rewarded very well for it. Skill and hard work are a prerequisite of my success but the success itself is largely down to luck. Skill and hard work are table stakes.
To put the equally uncharitable interpretation of your view of the world: The fact is that most success is significantly down to luck, but people don't like that because everyone wants to be the hero in their own story rather than just someone who got lucky.
https://en.wikipedia.org/wiki/SoftBank_Group
I don't think I've ever heard of someone "failing upwards" who's history starts with this:
SoftBank was founded in September 1981 as a SOFTBANK Corp. by then-24-year-old Masayoshi Son, originally as a software distributor. They went into the publishing business in May 1982 with the launches of the Oh! PC and Oh! MZ magazines, about NEC and Sharp computers respectively.[19] Oh!PC had a circulation of 140,000 copies by 1989.[20] It would go on to become Japan's largest publisher of computer and technology magazines and of trade shows.
In 1994 the company went public and was valued at $3 billion.[20] SoftBank agreed in September 1995 to purchase U.S.-based Ziff Davis publishing for $2.1 billion.[21]