Maybe the rational way to play the game then is to make that $200K, then stretch your reach and make $1M, and so on... until you've taken care of the money problem. Then that's when you're ready to start taking shots at the big opportunities, without being motivated by money or being held back by it.

The problem is by the time you've saved up $200k, most people are committed to a certain lifestyle based on their annual income. They're generally in their 30s or older, married, couple of cars, kids in school, mortgage, used to spending $X/yr on a vacation, etc etc. And, they've worked so hard to save up that $200k that it's unlikely they burn it to fund living expenses while they work on a startup.

Most entrepreneurs (generally, not just tech) are in fact in their 40s-50s. Well established professionals with good relationships and skills. Thing is they are usually doing it with Other People's Money, not their nest egg.

I don't think we're talking about "saving up $200K", at least I wasn't at all. Instead build and grow a profitable business to achieve that, not as ambitious as a "startup" but also nowhere near as risky. You're still an entrepreneur either way, just learning to crawl before you walk, so to speak.

I would argue it's easier to go all with a smaller hand.

Easy, but a lot higher-risk. It takes money, resources, and connections to actually do big things, and past wins improve your execution ability and chances of success.

But prescient market timing greatly skews the odds in your favor and gives you a huge edge too -- I think that's apparent in all the startup successes that started off with a small hand.

Better way to make money is to take out a personal loan for 100K, same opportunity cost of two years of programmer-salary on startups. Buy out of the money options on small-cap pharmacuetical facing FDA decisions, you have the ability to also make $10 million overnight with 30% success. Go for insider-tips to max out on your success.

Wouldn't the insider tips be illegal insider trading?

IANAL, but I don't think it would in this case. Insider trading generally applies to using private information held by the company. But in this case what you're looking for is information from the CRO or FDA.

A scheme similar to this is why I was reading medical and science journals in the late 90s for background knowledge, then scouring the pink sheets for applicable companies.

In the end, the hits I had were more or less luck, though. And on microscopic levels of investment, so I didn't get rich.

That sounds like the beginning of typical amateur trader career that ends up with 90+% probability in losing all invested money.

Is this... legit? or was it ever?

Wow, I had no idea Mathew Martoma frequented HN.

Tell me more.

nitpick: It's a loooooooooot less than 1%

Source? I've seen data pegging startup failure rates anywhere between 50-90%, but I've never seen a credible source claim that over 99% fail. Mathematically, no investor would be able to stay in business if 99% of their investments fail. I'm guessing failure rates for startups that have funding or bootstrap through revenue are closer to 75%.

It's not that 99% fail, it's that well over 99% of participants fail to hit a $1m payout. Top founders and early VC, as well as key executive hires, may win. For staff, including early engineering hires, "a good year" is a more likely outcome, after 2-6 years, or more, of sweat equity. Payout of 5-6 figures.

Assuming this is referring to founders. If you're an employee, you're the engineer making $100K in OP's comment.

> "If you're an employee, you're the engineer making $100K in OP's comment."

Except when you're not. I can't count how many times people I've met have been suckered into taking substantial pay cuts for not a lot of equity.

It's a real facepalm moment - what do you mean you're giving up $40K+ a year in salary. Did you know that even if your startup hits all of its wildest dreams you'll cash out for $80-100K after about 5 years? How in the world did that math ever make sense?!

I flat out refuse to talk to any founders that try to swindle people like this. Either put more equity on the table or pay me market. Quit relying on a tired lie.

The thing as always is how you define failure and success. Do all the founders of a startup that is considered a success make $10M? Of course not. In my opinion, that's where the "it's a lot less than 1%" might come from.