Recently Paul Graham–whom I respect a lot–posted something that got me thinking: are startups for rich kids, or not?
While there are exceptions, I believe startups for the most part are for "rich" people. Rich, in this context meaning privilege. Startups are for people who are privileged, who have family who can support them (both financially and emotionally), who can survive without a steady income stream for at least a year, and who have a safety net to fall back on.
When I decided to leave my CTO role at Zoom.ai and start dy/dx (www.dydx.dev), the first thing I did was pay off my credit card debt. I did this because I could, and I didn't want to keep paying interest while earning no income. I did this because I was lucky enough to have the financial stability to do this, and can go a long time without a paycheck– something that I am aware many people do not have the luxury of doing.
This doesn't mean I can live the same lifestyle as I have been living when I had a steady flow of income as I did when fully employed. Money is a depleting resource, but it also doesn't mean I'm going to go broke because I have no income stream coming in.
Money is something you always think about, but making decisions because you can't pay your rent is detrimental to your startup, and you will most likely make bad decisions because of that.
When I decided to drop out of university and start my first business, I had the backing of my parents. They aren't rich, they are a middle-class family, but I knew I had the cushion to fall back on, so I could take bolder risks and many of those paid off. I lived at my parents' house until I can get a steady revenue stream to move downtown.
So to Paul's point above: sure you don't have to be "rich," but you have to be privileged, or at least comfortable, to start a business and have the financial and emotional stamina to survive its many (eventual and potential) setbacks.
This breaks my heart because there are a ton of hardworking and brilliant people who have great ideas that can change the world. How do we enable those people to build their business and have the same privilege as startup founders? I have a few ideas, but that's for another post.