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Embrace the desire to make money

"If you want to make money, go into banking, not into startups."

"Only go into startups if you're really passionate about them, because you probably won't make any more money than from a good job, and probably a lot less."

"Startups are very risky, you'll probably fail to make any money."

"A startup's purpose should be to change the world for the better in a meaningful way."

Raise your hand if you've ever heard this. Raise your other hand if you've ever said this to others.

I have both hands up. If you searched through my voluminous HN posting history, you'd probably find at least the first statement in there word for word. What can I say, youth errs.

An alternative view

Having a good job in a high-wage industry can potentially result in having a relatively high wage. For example, being in finance (or indeed in software engineering in the Valley) can result in pretty high wages.

However, those wages are taxed very heavily. Of what remains, a lot goes into maintaining a certain lifestyle that goes with the job. Whether that's spending half your disposable income on rent in the Valley or having to go out to expensive bars all the time in the City, somehow, many if not most people working in these high-wage jobs don't accumulate all that much money.

Moreover, whilst those kinds of jobs used to be relatively steady, it can hardly be said that they are risk-free, especially in today's world. If you're working in a job, that means you're at the mercy of factors that you cannot see and which may drive you out of that job with little notice. And once the job is over, so's the money.

Finally, the kinds of jobs that pay well also have a tendency to require complete focus. They consume your attention, your life. You can't be an M&A banker earning hundreds of thousands of pounds a year without working incredibly long weeks that sap your life in exchange for all this money. When you work that kind of job, you have to be all-in.

I contend that a job, any job, is a very poor way to "get rich". It can be a good way to learn, but to get rich? Nope.

What about startups?

Startups in the Valley sense are also a pretty poor way to get rich, because they are like jobs with a high potential payoff on exit. If you sell your business for hundreds of millions, you will be rich. If you don't, however, you will just have collected a (probably not so great) salary for a few years, while pouring your entire life into the game. This is not that dissimilar to the banking world.

The quotes I started the article with are actually not so far off the truth, if you limit the word "startup" to the funded kind.

However, if you include all aggressively growing businesses in the word "startup", as per my definition from some time ago, then the picture changes. A rapidly growing business can definitely make you rich. In fact, one might say it's the best and most popular way to build a fortune.

However, no business will make you rich unless you actively want to make money. If you go into business with the mindset that you're in it to change the world and don't want any money, then guess what: you probably won't make much money. You probably won't change the world either, but that's another matter.

There are always exceptions, of course. However, it's never healthy to count on being one of the exceptions. A good plan, after all, doesn't just present one path to success - it sets things up so that all, or at least most, paths lead to success.

Embrace it

I meet far too many entrepreneurs who seem almost embarrassed to admit they want to make money. This is a very nasty side-effect of the Valley mentality of "it's about changing the world", a mentality that's contaminated the rest of the world (with both good and bad side-effects).

Wake up! If you're broke, it's perfectly ok, admirable even, to want to make more money. Society has little respect for the broke idealist waiting for his or her big break. If you're a student living with your parents (or about to once you leave university), or if you're beholden to a soul-sucking job because it pays your rent, or if you find yourself never able to afford the things you want, even though they are reasonable things like an up-to-date computer and a decent house to live in - then you absolutely should want to make money.

Money is not evil. It's a token of success in today's world. Wanting to make some money so you get the good things that go with it (like comfort and security) is a perfectly valid and admirable desire for anyone who's broke.

Of course, if all you ever want in life is money, then that's a different issue, but my guess is if you're still reading this article, that's not your problem.

A successful entrepreneur actively finds and uncovers opportunities for financial gain in the world around them. In order to find those, you need to be in the right mindset, and that mindset includes wanting to find these opportunities. If you've brainwashed yourself, or let others brainwash you, into not wanting money, you will not be a successful entrepreneur.

There will come a point in life where you have enough money, hopefully. At that point, you probably should start ventures that aren't about making money (though money-making businesses are a very robust way to change the world). However, that time is not when you're living off pot noodles and unable to afford a car.

In conclusion

Don't listen to people who tell you you shouldn't want to make money, that you should be "in the game" to change the world instead.

Until you've made enough money to at least be comfortable, you should be in the game to make money, explicitly, without any shame or hesitation about it.

More from the library:
Why VCs lie
Focus and myopia
Phantom user profiles for non-registered users