False, you just make something very valuable.
To get people to help you make it you offer to pay them and they willingly exchange their time for that money (or equity if they also think it will be very valuable someday or you have a record of making valuable things in the past)
Who is the person swindled here? Who agreed to something and was deceived? Who was stolen from?
This process is net wealth creation. The wealth is generated, not taken from somebody else.
To enter in a voluntary contract in wich one party works and the other party pays is not sufficient reason to declare that the working party had its fair share.
People need to be educated to ask for equity from every company they work, and society needs to normalise giving every worker in a company a proportional stake.
The wealth creation you talk about is true, the problem is that people creating that wealth are not equally rewarded. Signing a contract makes it legal, not right.
Ever experienced being the founding engineer and getting 0.5-2.5%? The amount of work done by the founding engineer for the amount of equity they usually get, there is definitely an unfair exchange here. I'd say the founding engineer is 99% of the time better off finding a non-technical co-founder and building something for 50% each.
Strongly agree from a purely economic perspective! However, founding engineer is a good way to watch the ups and downs of a startup before doing it yourself.
Additionally, since most startups fail, the founding engineer is typically better compensated than the founders. It’s only in the success case that it is a raw deal economically. However, in the rare case that it is a successful company, the founding engineer does alright and then also knows more about how to do it again.
The difference between founding engineer and founder is typically the difference between starting before any money came in or joining after (basically guts/conviction)
Yes, and I've also personally been responsible for cutting about a million dollars per year in AWS expenditure, and never saw a single cent in bonus payouts or equity. It just got repurposed in the budget. Same with building launching a product that brings in hundreds of thousands of dollars a month.
Maybe it depends on who you work for, but that was my experience.
I guess the point is that to reach the billion scale, you cannot be doing all of the important part on your own... So somehow, out of all the hardworking smart people you gathered yourself with, you decide that you're the genius that needs to benefit from the market value, while everyone else just gets compensated for their time...
The actual people doing the actual work, day to day, talking to prospects, building the things... But you had the idea, so it's just natural that you get the vast majority of the reward.
Maybe that makes sense to you... And like I disagree, but that's cool... But I cannot picture myself ever becoming a billionaire... I would have shared so much with the people that contributed to make me be a 100-millionaire way too much to reach the next step... And I'm sure I'd be happy to have 100 millions, and have people happy to get great compensation to do that with me...
Still, I agree it's not stealing. But the fairness of the situation is still up for debate.
One of the most difficult things a person can do is organize other people, especially when it comes to untested startup businesses. It's not just "having an idea".
Do you feel like the cafeteria workers at SpaceX who were paid standard cafeteria wages when they started plus some equity that everybody considered worthless at the time and now makes them multimillionaires feel like they were treated unfairly?
I am struggling to understand where the unfair part is coming from. Nobody is making anybody do anything. Everything is transparent and above board. Everybody in this scenario is willingly working market wages (except for founders and early hires who work below market and take equity for a couple years because they believe in the idea)
> the cafeteria workers at SpaceX who were paid standard cafeteria wages when they started plus some equity that everybody considered worthless at the time and now makes them multimillionaires feel like they were treated unfairly?
No I feel that's how it should be everywhere.
> Nobody is making anybody do anything.
I strongly disagree with that part. A CEO as an individual is not, indeed. But capitalism and the job market in general is forcing people to work, for sure... And even though the global wealth keeps increasing, and rich people keep getting significantly richer, the situation of the poor does not improve, and sometimes social benefits are reduced, access is made more difficult... Because it's important that some people still "agree" to work low paying jobs...
Is it really a fair choice if the alternative is to lose your home or starve ? This is exactly why child labor is forbidden for example. You can tell it's morally wrong. But it's been explicitely forbidden, because it used to happen, and people who defended it were claiming that it allowed kids to help their families and so on, but it also drove wages down, increase the workers' pool so they would compete more for the job, etc...
Maybe the market feels fair to you because you have skills people compensate for, but for people working minimum wages jobs, the market isn't fair, they absolutely have to get those jobs, otherwise they're on the streets...