That's partly because most people will have baggage to attend to that a college student living off student loans would not, and will lack the safety net that parents who can loan you $44k represent. There's not much here to convince that his performance is any better than the average among people in his position.
That is, among college students without the baggage of full adulthood (debt, personal responsibilities, the mental and physical degradation that starts as early as your mid-twenties, and the risk aversion that comes with these things), and with the support of at least moderately wealthy parents and the affordances they bring: yes, there's not much here to show above-average performance. This individual received exceptional advantages which he certainly capitalized on, but there's no indication that he did so above the level of an average replacement.
We owe it to ourselves to be realistic about prospects.
There's literally millions of college students in that position every year. Its absolutely not common for most of them to start _a_ successful business, let a lone several. I've worked at companies who had far more money, more connections, and more advantages, that ended up with less. OP's an outlier irrespective of their advantages.
> the mental and physical degradation that starts as early as your mid-twenties
Degrading in your twenties (in any meaningful sense) is _highly_ atypical.
Out of the ~20 million college students, the number that come from families with $40k in liquid assets is probably not plural-millions-with-an-s, and is probably considerably less than a million. With the field of competition winnowed thusly, and again considering the myriad unearned advantages such a background generally entails, this person's success is probably far more common than you're wagering. All you're proving is that people in his class are far less deserving than we'd thought.
>Degrading in your twenties (in any meaningful sense) is _highly_ atypical.
Nah. One's twenties are a common period for mental illness to develop, as well as the period when heretofore silent congenital defects become apparent. It is also generally the first time when injuries become much less likely to fully heal, and when they may become lifelong encumberances.
Someone who hasn't experienced some form of degradation by 30 - worsening eyesight, a sports injury, onset of depression, even balding - is someone who is privileged indeed.
Why? Means little. You can put a $44k deal together, even if you're a college student with no connections. It takes vision, some hustle, and an action plan. You might not think you can, but I sure know many can (including you and others reading this).
Most sellers are open to creative deals. No money down, seller financing (this applies to real estate and software).
Keep looking for excuses, you'll find them. I mean that in a firmly supportive way.
I'm not suggesting every deal can find a team. If it was already cashflowing and has assets, it is much easier to put a deal together. Software startups, conversely, often have neither and compete in a non-local market.
Raising money from friends and family is certainly a common path to entrepreneurship, but it is far from the only.
My original point was that acquisition entrepreneurship could be an option for someone with a broad skillset like the OP. How I funded the first one doesn't really impact that as everyone will have a different path and I simply took the one that was available to me at the time.
If an existing path can't be found then it will have to be made. That could mean working and saving for a while, starting a side project with the goal of it becoming a profitable business, partnering with a friend and earning equity through sweat, etc.
People are really upset with this comment because they think you're implying OP didn't do any work or that OP doesn't deserve it.
It doesn't much matter to me whether OP has "earned" their position of power, only that they had an enormous boost early in their career.
Just because $44k seems like pocket change to some people on this forum doesn't mean it's still an incredible amount of money that offers a fair amount of power on its own.
OP just explained what they did. Not to gloat but to explain their situation. What does it matter to you that they got help doing it?
I have 44k to invest if I really believed in something and I come from very modest means with no family help. If the stars align, it's a possibility. That's all you should take from their comment.
Because it answers a different type of question: What you would do if you wouldn't have to work for a living, for the next six months.
While interesting, most of us can't relate to this situation.
Having half a year worth of "fun money" to spend bootstrapping a business idea, or investng in one, is skipping the first step.
It's like one of these "draw the rest of the fucking owl" jokes:
I get $88K by working fulltime for $X months. Getting $44K _for free_ and then also having an entire fulltime of availability to work on a project is quite a gamechanger.
How can you spend $44K on a project and live off of it at the same time, in the latter case where someone handed you the money?
And if you are saving $44K per year, why can't you work for two years and then take one year off, having both $44K to live on and $44K to spend on a project?
And finally, didn't this start with a $44K loan, not a gift?
If you have some hustle anyone can raise that type of money.
When I worked retail in college, a coworker was able to get $150k together to lease a 737 and crew for a couple of trips. He was then able to leverage his girlfriend’s boss (travel agent) to get some trips to Aruba and some other island. He netted enough to pay for his tuition, which was the goal.
>It's good for the people "on the margins", those struggling to pay rent, or those at risk of homelessness, or those who might like to move to a more productive place for a better job.
Please cite at lease one example in which this has ever been the case. I do understand the theory behind your argument here, and I assume you are familiar with (leftist) counter-arguments, so this is not an attempt to open a debate. Rather, I want you to be right but until I see some solid evidence I am unconvinced.
>One of my prouder YIMBY moments was turning out 5 people on a weekday morning to speak to our state rep, who ended up voting in favor of HB 2001, which legalizes up to 4-plexes throughout most Oregon cities.
This is a great example of how it seems to me that YIMBYs are anti-NIMBY in the way Democrats are anti-Republican. Time and time again, it appears neither groups are actually doing any thing ‘good for the people “on the margins. Clearly, this policy benefits landlords more than anybody and the implication is that this is besides the fact of lowering rent prices. Fine. But it is not insignificant that all of these efforts primarily promote the perpetuation of rent-seeking.
I watched from the front row as investors bought up Portland. It has been about 6 years since it entered full-swing and rent prices are higher than ever before. This is not good for people “on the margins”. In fact, most of those people were not even on the margins before the investors came in. I am one of them. I should know.
Of course, history is littered with cases of YIMBY theory failing urban housing markets, so please show me an example of where your theories have actually succeeded.
While I don't doubt that building more homes brings prices down, the real reason housing is cheap in Montreal is because Montreal is poor, has lower immigration, little in the way of industry to attract migrants, language barriers, and it doesn't have a basis of Chinese ex-pats to anchor a lot of foreign buying which is a huge driver of prices in Toronto and Vancouver.
Edit: I should add, I live here and am very intimate with the issue.
Rental housing has price floor that distorts the market. Once a property diverges from the requirements of housing subsidy programs, it usually gets abandoned.
In most places new supply is high end and is making more housing available for people who don’t lack access.
> In most places new supply is high end and is making more housing available for people who don’t lack access.
In most places, new cars are more expensive than used ones, but if you stopped providing new cars, the price of the used ones would shoot up as everyone started competing for a dwindling supply of cars.
You can’t compare cars to real estate and property.
For one, most property and real estate appreciates in market value on it’s own. This makes spec construction viable, and why most new apartment buildings in expensive cities are ”luxury” units and rented for very high rates. The owners are happy to let them sit empty and starve the market to max out demand when they know there is enough jobs in the area that people are competing heavily to move there.
In addition, the markets are tiny compared with cars, which are easy to move to cars to other markets (cities).
>In most places, new cars are more expensive than used ones, but if you stopped providing new cars, the price of the used ones would shoot up as everyone started competing for a dwindling supply of cars
An unspoken consequence of cash for clunkers. Practically overnight 100k miles was considered "low mileage", which was ridiculous before people started needlessly trashing perfectly good used cars.
Eh, I’ve heard that before as well but I don’t know if it’s true. By the time the program ended in 2009, cash for clunkers had taken ~700k cars off the market. The same year, about 35 million used cars were sold in the US[1]. Cash for clunkers was a rounding error.
New supply in housing shortage area is expensive, for the same reason old housing is expensive there: THERE IS A HOUSING SHORTAGE!
Therefore, if you say it's bad to build new housing if it will end up being expensive, you're really saying there should be no new housing built during a housing shortage...
I find it's often better to think it terms of number of homes and housed people than in prices. If 100 new apartments are built, it's hard to say what will happen to prices exactly. But it's undeniable that there will be 100 more homes, and 200-300 more people can live indoors in that city, than without the project.
> In most places new supply is high end and is making more housing available for people who don’t lack access.
People are outraged when you put apartments and condos in their multi-single-family cities because "lower class" people will move in. Don't those "lower class" people currently lack access to live these places?
> Clearly, this policy benefits landlords more than anybody
Well... no. If your SFH zoned lot is now duplex-friendly, it means your house goes up in value because it can be immediately rented out to two people or you can rent it out to another family immediately, without asking anyone, as long as you do the required physical modifications. Now your home value is increased by the amount of revenue (at an appropriate discount rate) it would draw in from two simultaneous occupants in perpetuity, which is always higher than the rate possible from one occupant.
It literally benefits everyone
> Of course, history is littered with cases of YIMBY theory failing urban housing markets
No, it's not. History is a constant example of the success of the free market, which YIMBY's are in favor of, and NIMBY's are against. This is ridiculous.
Wait.. so you are just opposed to people having somewhere to live? You’re saying that more apartments on the market makes prices higher? I don’t think I’m going to be able to follow the logic here.
The problem with the “try to understand NIMBYs” concern trolling in this thread is that there isn’t much to understand. The only common thread in NIMBY philosophy is fear of change, and some mild xenophobia.
I think there’s a lot more common ground to be had with far-left PHIMBYs who want the government to build most housing. At least that’s a coherent philosophy and a proposed solution.
When investors buy property, they almost always intend to raise it’s value to increase their profit. That’s how this works. They very often tear down affordable units and build luxury ones, because the YIMBY policies peculiarly never take issue with that.
Realize most property and real estate appreciates in market value on it’s own. This makes spec construction viable, and is why most new apartment buildings in expensive cities are ”luxury” units and rented for very high rates. The owners are happy to let them sit empty and starve the market to max out demand when they know there is enough jobs in the area that people are competing heavily to move there.
Speaking as the SO of a major property management company exec operating in Portland, no it wasn't a policy that benefits landlords. Not in the slightest. More competition and lower prices are a landlord's and developer's worst nightmare.
And yes, due to the scale of development, rents are lower than they expected when they built. Your prices were gonna go up regardless, and the scale of development that happened actually kept prices down.
As I said, rents are higher than ever before. Why should renters care if investors are exploiting them for as much profit as they originally wanted to? My point stands: rents are higher than ever before. Not lower.
> Portland added 4,419 unit of completed housing in 2016, a slight increase from the roughly 4,365 it added in 2015, which combined is more than all the housing units added in the five years prior to 2014, according to the Portland Housing Bureau's 2017 annual report.
> Year-over-year average rents declined by a full 1.2 percent in the city of Portland, with average rents dropping to $1,140 per month for a median one-bedroom apartment, according to the yearly rent report from Apartment List. It's a similar story in Seattle, with Apartment List data showing rents declining 1.6 percent from where they were in 2017. The median monthly rent for a one-bedroom apartment in Seattle is $1,346.
When you don't build more, rents go up. When you start to build enough, rents go down. It's pretty fucking simple. In fact, it is econ 101.
I'm not sure exactly what you are looking for to be convinced but I'll try.
First of all, for example in the Bay Area there are more people who would like to live there than there are houses, and so the people with more money bid up the price and "win" the house, while the people with less money are priced out and must live elsewhere. Hopefully you agree with this basic premise?
With this model, if there is one less house, one more person will be priced out, and if there is one more house, one less person will be priced out, since the number of houses determine how many winners there will be (and as long as people don't change their minds about wanting to live there if they could afford it).
I've heard people worry about "induced demand", and I agree it's true that there's probably many people that would consider moving to San Francisco from elsewhere if the price started coming down (and of course vice versa), and that that would prevent the price from lowering too quickly. But those people moving free up housing in Austin, Seattle, etc, and there are more "winners" overall.
I think a lot of the people "on the margins" of being priced out in the Bay Area are not on the edge of homelessness - often they are able to move and drive up demand elsewhere. But I do see more and more people living out of RVs and vehicles parked near freeways.
For the price increases over the last couple decades, I think the demand has gone up for most first world cities. I think this is mostly because the industries that are booming are mostly knowledge work, that tends to have a higher specialization of labor so is more naturally located in places with higher population densities that have more liquid job markets (in addition to network effects within certain industries). I think the solution to this is to build more housing in cities but the alternative is lower income workers/industries are displaced and landowners are enriched.
For a specific example of this theory working, Tokyo is subject to a lot of the same economic forces as other first world cities that drive demand up (wrt labor specialization etc). They've managed to keep housing under control, but in order to achieve that they've had to allow almost double the amount of new housing as all of California (despite Tokyo having only around 1/3 the population) [1].
Citing Japan only further proves my point. Property values don’t appreciate the same in Japan because, and one reason is that they don’t have a finance industry that allows them to. Land owners cannot get rich by mere property appreciation like they can here. I definitely think we should imitate Japan more, but this isn’t simply a matter of “allowing more housing”. Acting like that’s all there is to it is disingenuous.
Japan does real estate development with banks and loans like the US does, and interest rates are even lower so it's easier to borrow a large sum of money. Can you explain what you meant about the finance industry not allowing prices to appreciate?
Their zoning is where they have obvious huge differences. The zoning categories are set at a national level and limit how restrictive local cities can be (there's 12 categories based on nuisance level). The higher zoning usually allows lower density also, so cities just start with a little extra zoning headroom that allows them to grow over time. They also automatically permit things that follow zoning. [1]
In the US zoning is more local, often there are many more zone types that are much more restrictive about what they allow (it's more micromanaged and often prohibits things like mixed-use in addition to multi family). In many of the biggest markets even projects that follow zoning are usually not allowed, every project is an individual years long fight. Also in cities like Los Angeles the zoned-for capacity has actually dramatically decreased over time, even as the population grew. [2]
Some of these policies may be a legacy of people deliberately not wanting it to be too affordable, because neighborhoods didn't want low-income people to move in. Of course now in many places even middle-income people can't afford it.
I think, from a social justice perspective, the US policy has been an abject failure. It's increased pollution (from long commutes) and homelessness. It's deprived people of good paying jobs, since they can't afford to move to the locations where they're available. It's squeezed the middle class and enriched landlords, there's even debate that housing may be the most important contributor to wealth inequality. It's anti-environment since higher density has less environmental impact on a per-capita basis. I'm sure there's some upsides, but I can't see any that remotely justify the long-term costs that these policies have brought about.
In california, landlords largely did get us into this mess though. Like not on an individual scale, but as an organized political constituency they lobbied for the policies that have caused the problems we're experiencing and they're generally lobbying against the solutions.
It's a distraction in that it may lead to bad intuitions about what to do, like trying to "punish" landlords in some way will somehow make up for something.
I do a lot of housing policy activism outside my daily work in tech and I entirely disagree with you. On a large scale, real estate associations and "landlord" associations are an incredibly influential lobbying coalition in the state of California, and on the whole, they exert a hugely negative influence o housing policy. I don't think there is any reason to advocate punishing landlords where "punishing" is throwing them in jail, but the problem is that 99% of landlords will say that anything that you might do that lowers the growth in value of their assets or increase taxes on them is punishment, and they lobby in sacramento on that basis. The reality is that most of the policy changes that California needs (zoning reform, property tax reform, vacancy taxes, etc) will have the landlord lobbies against them on the basis that they are "punishing landlords".
On a larger scale, something like 85% of the state legislators in Caliifornia are themself landlords (they own a unit/home that they lease to someone else) and are profiting off the housing crises not just by owning their own home, but by profiting of the exorbitant rents of others. On some level, the housing crises in california is caused by the state legislature fighting for their own class interest and their own personal financial interest as landlords.
You are absolutely correct that the root cause of the housing crisis is capitalism and the commodification of housing. However, a socialist restructuring of the entire housing market is not likely to happen any time soon.
While we wait for the revolution, we might as well encourage the for-profit developers to build in the least destructive ways, so that less people suffer in the short term from the choked supply and anti-human urban planning that capitalists will exercise if left unchecked.
> You are absolutely correct that the root cause of the housing crisis is capitalism and the commodification of housing.
Every other commodity in my life, food for instance, is dirt cheap and getting cheaper all the time. Housing is expensive because it is not a commodity. You have to beg the government to allow it to exist.
You're speaking past each other. In marxist economics literature "commodification" means something is able to be bought and sold, not that it is a commodity in the broader ecconomic sense (an undifferentiated good with broadly elastic demand). "Honor" isn't commodified, "dignity" isn't commodified, "food" is commodified, and "rare collectible art" is commodified.
Thanks for the clarification. If it's a definition that applies to literally every physical good in a market economy, then it doesn't have much explanatory power to explain why some things are cheap and abundant, and why some things are expensive and scarce.
yea, I mean there have been large periods in human history in which land was not bought and sold. Many indigenous cultures don't have a strong concept of land ownership. In many modern socialist countries (Singapore, china), you cannot "buy land" you can lease it from the government for a long period of time (usually 99 years). In the united states, "education" is a good/service that transverses a weird line between "marxist commodity"/"non commodity" as we have education as a public good and we also have public schooling.
I want to be clear here that I'm not making any value judgements with my statements about capitalism vs socialism/marxism, and I agree that the "commodification of housing" IMO doesn't explain why its expensive, but to be fair, the people making that argument are generally not making an argument on values (housing aught to be...), and values are kind of a "first principles" type thing that you can't persuade or prove wrong, they just are.
Actually, a lot of values can be obtained from other, more general, values. Not everything of course or we'd all agree on everything! But I wish people would do this more often when they make arguments about rights and wrongs. Something like "I agree with X because it's a special case of Y which I hold as an axiomatic value". Instead, they just seemingly randomly decide which side their opinion falls on then try to make up random pot-shots of excuses to defend it.
If housing was not a commodity, then it could not be bought and traded with fluctuations of value and expectations of profit on the part of the owners. The cost of housing would not be a problem if it was priced for the benefit it provides, instead of its profit potential.
It isn't the price of housing that's the root problem, it's the arithmetic. There aren't enough homes in places people want to live for the people who want to live there. The price decides who gets them, but arithmetic causes the underlying suffering.
If there isn't enough food, someone goes hungry. The price just decides who. If there isn't enough housing, someone has to move out. The price just decides who.
Choosing "who" via a more equitable method than price doesn't reduce the amount of suffering, it just spreads it around better.
What you're saying is that price isn't the problem, scarcity is the problem. Price is just an inevitable consequence of scarcity – the symptom, not the cause.
yeah, housing should not be a commodity and should not be subject to market forces; instead, a benevolent committee of compassionate people (well-read into marxism, of course) should decide who gets to live where
Please don't take HN threads further into ideological flamewar. The GP comment shouldn't have been flamebaity, but not taking the bait is actually more important.
Reddit is easily the best model for social media, if only the software was better. The key is prioritizing community over individuals. Subreddit admins have a ton of freedom, so long as a very small bit of their energy goes toward a few basic universal rules. This gives them a real sense of ownership.
Healthy social media must support and defend pseudonymity, because it’s the only way to juggle the fact that everything on the internet can be recorded by at least one other party. And the only way to defend pseudonymity is to treat every user the same. Twitter’s “approved” users violates this and Facebook violates it in many different ways, but Reddit just prioritizes communities over individuals. This is the root of the solution.
When people treat Reddit like it has some broad character or quality, I have to disagree. Those people just haven’t found a subreddit that they love, probably because they haven’t tried to. And I don’t think that needs to he changed or automated. If a Reddit-like site was the only social media, all these people would be motivated to create or build their own communities.
Fyi, none of this applied to my cofounder or I. Both of us grew up lower middle class (family incomes under $60k/year) and went to public grade schools, high schools, and colleges.
We met the people who are our angels by excelling in our careers. Eg founders of companies damn sure remember their top 3 sales reps.
Thanks for being honest. It might help to put this in the first comment though.