From what I understand, the thing that changes when you have lots of money, is you can act as an investor in individual ventures that are much riskier, but with a much higher potential payoff. If you can drop $1 million without being ruined if it doesn't pan out, you can multiply your money very quickly when things do happen to go your way.

In fact, isn't that basically the entire premise behind all the VC funds that fuel Silicon Valley?

>isn't that basically the entire premise behind all the VC funds

Which often don't have especially high rates of return.

I don't really disagree with your basic point. At least somewhat higher investments do give you access to a wider variety of financial instruments even if diversified through a third party.

Yes but the $100 million guys can afford higher risks with higher returns. The $1000 guys can only play it safe with small returns.

The $1000 guys can afford humongous risks if they're 20 year olds saving for retirement. In fact, if they have a job to live off of, their risk tolerance is going to be far greater than a rich person living off their wealth.