Slashdot Mirror

← Back to Stories (view on slashdot.org)

Why You Shouldn't Imitate Bill Gates If You Want To Be Rich (bbc.com)

Posted by BeauHD on from the copy-and-paste dept.

dryriver writes: BBC Capital has an article that debunks the idea of "simply doing what highly successful people have done to get rich," because many of those "outliers" got rich under special circumstances that are not possible to replicate. An excerpt: "Even if you could imitate everything Gates did, you would not be able to replicate his initial good fortune. For example, Gates's upper-class background and private education enabled him to gain extra programming experience when less than 0.01% of his generation then had access to computers. His mother's social connection with IBM's chairman enabled him to gain a contract from the then-leading PC company that was crucial for establishing his software empire. This is important because most customers who used IBM computers were forced to learn how to use Microsoft's software that came along with it. This created an inertia in Microsoft's favor. The next software these customers chose was more likely to be Microsoft's, not because their software was necessarily the best, but because most people were too busy to learn how to use anything else. Microsoft's success and marketshare may differ from the rest by several orders of magnitude but the difference was really enabled by Gate's early fortune, reinforced by a strong success-breeds-success dynamic."

39 of 311 comments (clear)

  1. Very simply expressed in xkcd.. by Junta · · Score: 5, Funny

    https://xkcd.com/1827/

    --
    XML is like violence. If it doesn't solve the problem, use more.
    1. Re:Very simply expressed in xkcd.. by MightyYar · · Score: 2

      Yes, the article is also cherry-picking. But that doesn't mean studying only the successful business people isn't a great example of survivorship bias. Notice that you picked Andrew Carnegie and Sam Walton instead of Andrew Carnegie's neighbor and Sam Walton's classmate.

      --
      W..w..W - Willy Waterloo washes Warren Wiggins who is washing Waldo Woo.
    2. Re:Very simply expressed in xkcd.. by 93+Escort+Wagon · · Score: 5, Insightful

      Gates DID get a lucky break - there's no question about it. However that "break" was to be born into a well-off and well-connected family.

      And, honestly... if you can pull that off, it's almost certainly the best way to "become" rich yourself.

      --
      #DeleteChrome
    3. Re:Very simply expressed in xkcd.. by Archtech · · Score: 3, Insightful

      Gates DID get a lucky break - there's no question about it. However that "break" was to be born into a well-off and well-connected family.

      That's not the half of it. He also had the "good fortune" to pick a mother who could persuade the chairman of IBM to cut her son a ridiculously favourable deal.

      --
      I am sure that there are many other solipsists out there.
    4. Re:Very simply expressed in xkcd.. by cheesybagel · · Score: 5, Insightful

      Microsoft didn't have an operating system. They had to get it from someone else. IBM basically went to talk with Microsoft because Gates' mother, who used to be a bank manager, did benefit work on weekends with people connected with IBM's management. And Bill Gates' father, one of top lawyers in the area, helped craft their (highly favorable) contract with IBM.

    5. Re:Very simply expressed in xkcd.. by msauve · · Score: 2

      Nope. IBM was already talking to MS because MS already had market dominance for BASIC (Apple, Commodore, and Radio Shack all used MS BASIC) and had other languages available which IBM wanted to be able to offer. Personal contacts had nothing to do with it.

      --
      "National Security is the chief cause of national insecurity." - Celine's First Law
    6. Re:Very simply expressed in xkcd.. by Anne+Thwacks · · Score: 2
      As someone who was 4,000 miles away at the time, I could smell the stink from here.

      The IBM team wanted CPM, but Garry Kidall was flying in his private plane when the IBM people called at his office. He simply did not believe his luck and assumed it was a hoax. The IBM guys went/phoned home "no deal here" Mrs Gates must have been present when the call came in and said "My son has an OS you could use" - not knowing the difference between a Basic interpreter and an OS. why else would the IBM guys have gone and asked a school kid if they could buy his OS? when he did not even have one?

      I worked for a company that had a perfectly good OS at the time. Could we sell it? Hell no. Intel had an OS - would they sell it? hell no! Were there other alternatives known to work? probably (see DECUS).

      Without any research or due diligence at all, IBM, known for their lawyers, signed a contract that shafted IBM as much as it shafted the rest of the industry.

      That is what sinks.

      (And we all believe the executives sold their shares "by accident" after the data leaked, and before the news was published? What part of gullible to you not understand?)

      --
      Sent from my ASR33 using ASCII
  2. being completely with out by Revek · · Score: 5, Insightful

    scruples didn't hurt. He had little problem with raiding others ideas and pushing them out of the market. Many of the things he did to get on top of the pile would be actionable today.

    1. Re:being completely with out by nagora · · Score: 4, Interesting

      scruples didn't hurt. He had little problem with raiding others ideas and pushing them out of the market. Many of the things he did to get on top of the pile would be actionable today.

      Google suggests otherwise - industrial-scale copyright infringement? Just ignore it and no one will do anything about it. Global tax evasion? Get the law changed and move on - tax is so "statist", this is the (new) age of the unaccountable corporation. They're not doing exactly the same things Gates did, but they are doing their things in the same style, and that's what actually works.

      --
      "Encyclopedia" is to "Wikipedia" what "Library" is to "Some people at a bus stop"
    2. Re:being completely with out by Opportunist · · Score: 4, Insightful

      Aka "it's better to ask for forgiveness than for permission".

      --
      We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
    3. Re:being completely with out by DontBeAMoran · · Score: 5, Insightful

      He knew what the big thing was, that's why he said the Internet was a fad. It also explains why you had to add third-party patches to Windows 3.11 to get your computer on the Internet.

      --
      #DeleteFacebook
    4. Re:being completely with out by dryeo · · Score: 3, Insightful

      One of the stories I heard was his contract with IBM allowed him to set the prices of the other OSes.
      Which brings us to the real smart/lucky thing Gates did, signed a very good contract that let MS keep control of DOS and perhaps the above.
      This was possible for several reasons, coming from a family of lawyers, and IBM, due to the antitrust actions on them, being eager to look like they weren't a monopoly.

      --
      https://en.wikipedia.org/wiki/Inverted_totalitarianism
  3. Step 1 to being like BG has nothing to do with by laupark · · Score: 4, Insightful

    Step 1 to being like BG has nothing to do with his exact circumstances. It has to do with making use of YOUR special circumstances effectively. Capitalizing on each situatiin and conpunding the gains

    1. Re:Step 1 to being like BG has nothing to do with by Ryanrule · · Score: 5, Insightful

      Most people dont have any special circumstances.

    2. Re:Step 1 to being like BG has nothing to do with by jonsmirl · · Score: 5, Insightful

      If you want to get rich you need to partake in an activity that has the potential to generate a lot of money. I have often heard people complain that they give everything working in a job and can barely keep their heads above water. Get a clue, working in a job makes the company owner rich, not you. You also need to do something that amplifies your actions. For example it is hard for a doctor to get really rich. That's because they are paid per action they perform and there is no way to scale. If you invent a drug you can get really rich since the drug goes into a factory which amplifies your invention. You also need to understand the difference between capital and income. It is far easier to get rich off from capital transactions that it is off from income.

      Gates' success is impossible to replicate. He had a "first movers" advantage that is gone now. He was also greatly helped by "network effects". These are also things you need to understand to get really rich.

    3. Re:Step 1 to being like BG has nothing to do with by jonsmirl · · Score: 2, Insightful

      Special circumstances happen all of the time. You just need to recognize when they are happening around you.

    4. Re:Step 1 to being like BG has nothing to do with by Opportunist · · Score: 5, Funny

      Again, the best chance most people have for "special circumstances" is to jump into the way of a rich person's car.

      --
      We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
    5. Re: Step 1 to being like BG has nothing to do with by laupark · · Score: 2

      You had me until "impossible to replicate". It is totally possible to replicate as you explained in the bit about amplifying success. Yes, you can't sell DOS to IBM again, but Bezos found a way to grab a fat pile of cash, Musk has too. Some kid named zuckerberg seems to be doing ok. Not EXACTLY a bill gates copy, but not too shabby a shpw for these guys so far. I guess it depends on what you think defines Bill Gates' success to date?

    6. Re:Step 1 to being like BG has nothing to do with by decep · · Score: 3, Funny

      Special circumstances are not uncommon, but valuable special circumstances are rare.

      Being able to fit 3 golf balls in your mouth is special, just not something that you can easily capitalize.

    7. Re:Step 1 to being like BG has nothing to do with by jonsmirl · · Score: 4, Insightful

      Starting your own company is a huge piece of it since it gives you the capital piece. Do you know about IRS section 1202 stock? With 1202 stock your first $10M of capital gains is tax free. 1202 stock is Small Business Stock. The federal government and many states do not tax gains from this type of stock since it is a major way jobs are created.

      But... this company has to have an amplification effect. That is why it is so easy to make a lot of money in software. The marginal cost of 'amplification' (making another copy) is zero. Zero amplifications costs really lowers the amount of capital you need. It is certainly possible to start a software company while working else where to cover your basic expenses.

    8. Re: Step 1 to being like BG has nothing to do with by Opportunist · · Score: 2

      Having innate knowledge of a subject is a special circumstance.

      OK, what subject would a kid in some slum have innate knowledge about that is in any way monetizeable?

      Having undeniable charisma is a special circumstance

      Great, and now for the other 99% of the population?

      Being able to identify people that can do the jobs you need done and keeping them together is a special circumstance.

      Same answer.

      Owning the only lumberyard that didnt blow away in a hurricane is a special circumstance.

      Agreed! Too bad it ain't the case for nearly everyone.

      None of that has much to do with rich mommies and daddies

      No, all of that has to do with being extremely lucky. By that logic, I can play the lottery, too.

      With most people it already starts at them not being able to find out what "special ability" they might have. To take one of your examples, finding out that you're good at organizing people and managing them first and foremost requires you to be given the chance to organize and manage people. For many people, it's already a lucky break if they get a chance to show that they CAN do something.

      --
      We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
    9. Re: Step 1 to being like BG has nothing to do with by jonsmirl · · Score: 2

      A recent example of a huge first mover's advantage is Uber. You don't have to have a market the size of Uber's, there are many smaller markets that also will work.

    10. Re:Step 1 to being like BG has nothing to do with by jonsmirl · · Score: 2

      Don't worry about IP laws, just don't blatantly abuse them like Napster did. There is very little you can do to stop an IP troll from targeting you if they want to. You best defense is to stay off from their radar.

      BTW - you can start a software company for almost nothing now. Back in BG's time PCs were $3,000 inflation adjusted to like $20,000 now. You can get a great PC today for $1000 and you probably already own it. AWS and Google will both let your try the cloud for free for a year. Lack of capital is not an excuse for not doing a software start up.

      If you are not doing a startup because you need a $50,000 salary, then being a founder is not for you unless you are very creative. Instead come in as a later employee and get a salary. You will still get some upside from stock but it will be a pittance compared to the founders.

    11. Re:Step 1 to being like BG has nothing to do with by hey! · · Score: 3, Insightful

      Actually I'd put it this way: most people don't have special circumstances that are as easily recognizable in advance.

      For example, Mum being chummy with the chairman of IBM at a time they're launching a product you're interested in is pretty trivially recognizable as a special circumstance.

      --
      Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
    12. Re:Step 1 to being like BG has nothing to do with by Solandri · · Score: 3, Insightful
      My extended family moved to the U.S. from Korea in the 1970s. Korea was still rebuilding back then and was paranoid about people leaving with their money, so limited emigrant families to taking about $1000 with them. So each of my father's and mother's siblings (8 in total) arrived in the country with about $1000 and the clothes on their back (and sometimes kids in tow). From worst to best off:
      • One unfortunately married an alcoholic, and lives in a trailer park with a poverty level income.
      • One made a middle class life built on running a dry cleaner 10 hours/day 6 days/week.
      • One made an upper-middle class life built on working overseas construction projects in crappy or dangerous locales. He gets home a couple months out of the year, but is otherwise "at work" 24 hr/day the rest of the year, and mails his paychecks home to his family..
      • One made an upper-middle class life built on a dual income (nurse and owning/running a printing shop).
      • One made an upper-middle class life built on buying a liquor store and working there 14 hours/day 7 days/week, and investing their income wisely in real estate instead of frittering it away on things like fancy cars and big screen TVs.
      • One made an upper-middle class life built on a dual income (engineer and pharmacist).
      • My dad was a doctor before moving here, so I'd leave him out of the statistics (lower-upper class). Although I do recall living in assisted housing and having to get clothes and other goods from the Salvation Army because we were poor while he was doing his recertification internship.
      • One married a wealthy husband.
      • One is upper class - they risked everything they had to start a cell phone store back when cell phones were first becoming popular, and now own a chain and warehouses worth several $million. No fancy education or pre-existing wealth. Just a lot of hard work, and an extensive list of contacts they've built up over the years with cell phone accessory manufacturers and suppliers in China.

      If you've convinced yourself or somebody else has convinced you that you have no chance to make "special circumstances" for yourself, then you've already lost. Enjoy the lower or lower-middle class lifestyle that you've consigned yourself to. Yes luck plays a role. But if you don't at least try, you'll never get anywhere.

    13. Re:Step 1 to being like BG has nothing to do with by WrongMonkey · · Score: 3, Insightful
      None of the situations that you describe sound like "upper-middle class".

      One of the characteristics of being middle-class is having leisure time. No matter how much money you're making, working 14hours/day, 7 days/week is not middle class, upper or lower.

    14. Re:Step 1 to being like BG has nothing to do with by david_thornley · · Score: 2

      There's no evidence that Gates recognized special circumstances. He got into software early on, but lots of people did that. I was programming mainframes and my TRS-80 when the IBM PC came out. He completely missed the future of the Internet, and his GUI development followed Apple's. His idea of a tablet was a heavy and expensive portable device running XP. Microsoft made its name initially by producing what was arguably the best BASIC for 8-bit home computers, but there were plenty of other BASICs.

      He lucked into a developing field, and was very good at it and worked hard, and in the normal course of events would have become a very successful businessman. His mother tipped him off to an opportunity and his father wrote up the contract that meant his version of Seattle Computer Club's QDOS would be on almost every IBM PC, without giving IBM control of the software.

      --
      "When you have eliminated the unacceptable, whatever is left, however improbable, must be the truthiness" - Holmes
  4. Survivorship Bias by ptaff · · Score: 5, Insightful

    The Misconception: You should focus on the successful if you wish to become successful.

    The Truth: When failure becomes invisible, the difference between failure and success may also become invisible.

    Survivorship Bias; You Are Not So Smart

  5. Let me see here by burtosis · · Score: 5, Insightful

    So I shouldn't have a extremely wealthy family, who is well connected, and further take vast sums of money to start a business - and if it fails just take even more money to try again? I'm pretty sure that is possibly the single most consistent detail of the success stories of the super wealthy.

    1. Re:Let me see here by burtosis · · Score: 4, Insightful

      Going off our president and many others I'm starting to think being smart is a hinderance. Having an ounce of decency or a single moral fiber almost assuredly is.

    2. Re:Let me see here by LaminatorX · · Score: 3, Informative
      | What was it that Steve Jobs did that you did not?

      Grew up in Silicon Valley at exactly the right time.

      Marketed Steve Wozniak's brilliance, repeatedly.

      Figured out that how people interact with a machine is as important as the capabilities of the machine itself.

  6. Why you shouldn't imitate yourself by Anonymous Coward · · Score: 5, Insightful

    I was very active in startups between 1995 and 2000. Many entrepreneurs made a lot of money, and many lost the money again, because after the trick that earned them the cash, they thought they were pretty smart and wanted to replicate the success by investing in newer startups. Then they found out the hard way it wasn't how smart or special they are that made them successful at first, but that they were at the right place at the right time.

  7. Re:Education and hard work by Opportunist · · Score: 4, Insightful

    The most successful ones, though, combined psychopathy with the hard work of others.

    --
    We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
  8. Jokes aside, it's not hard by RevDisk · · Score: 5, Insightful

    To get rich you need three things.

    Hard work - Don't discount this. Yes, connections and money make things easier, but it still takes work. A lot of it.
    Intelligence - Hardest work on the planet won't always get you further.
    Sheer flat out luck - Being the hardest working smart person doesn't help if you get a crippling illness or just at the wrong time. Being born wealthy or with connections is genetic lottery.

    You pretty much need a lot of all three to get super wealthy. Two will get you into a decent place and you'll do fine.

  9. If you just work hard enough you can do it too by bravecanadian · · Score: 4, Informative

    You'll be super rich and successful too, honest. Just listen to all the successful people who believe this...

    Sure, hard work is part of it, but as this article points out it is only part of it. Coming from the correct womb and happening to be in the right place at the right time seems to have a lot more to do with it.

    There are plenty of people who work their asses off and get no where.

  10. Just close enough to the truth to be misleading. by feenberg · · Score: 4, Insightful

    It is true that there are a lot of people that claim that since monopolists are successful and charge high prices for poor products, you can become successful by charging high prices for a poor product. That generally doesn't work for non-monopolists. On the other hand, the emphasis on Bill G's parents does ignore the fact that IBM offered the same opportunity to Digital Research, which turned them down. And IBM offered a word processor of its own - can't have more advantages than that - and it failed in the marketplace. It also offered an OS - what happened to that? Maybe it was higher quality than Windows, but it was 10 times as expensive and the only print driver it came with was for a single dot-matrix printer.

  11. Re: Thomas Watson, Sr by Archtech · · Score: 2

    "...NCR assigned Watson to run the struggling NCR agency in Rochester, New York. As an agent, he got 35% commission and reported directly to Hugh Chalmers, the second-in-command at NCR. In four years Watson made Rochester effectively an NCR monopoly by using the technique of knocking the main competitor, Hallwood, out of business, sometimes resorting to sabotage of the competitor's machines.[6] As a reward he was called to the NCR head office in Dayton, Ohio.[4]

    "In 1912, the company was found guilty of violating the Sherman Antitrust Act. Patterson, Watson, and 26 other NCR executives and managers were convicted for illegal anti-competitive sales practices and were sentenced to one year of imprisonment".

    https://en.wikipedia.org/wiki/...

    Yes, emulate Watson by all means. But make sure you have some good lawyers - and, above all, invest in some legislators.

    --
    I am sure that there are many other solipsists out there.
  12. Re:Just close enough to the truth to be misleading by ZayJay · · Score: 2

    No, no, you don't want to disrupt the narrative that Bill Gates was the most evil man in human history that engaged in the most brutal of business practices right out of the Joe Stalin playbook. Really folks, I would never say the guy was a saint but there was a lot of market forces at play that tend to go unacknowledged in the PC story, and Gates may have played a little hardball, but he was hardly the Mafia Don that he is often portrayed as. ( As for that Anti Trust suite in the 90s I heard some of the stupidest technical discussions ever about the "browser market" as if it was a platonic entity that necessarily existed, and that by giving away IE MS was doing something evil. Really.) Now Gates is giving away Billions after Billions in Charitable causes and urging other successful billionaires to to the same. Bad Bill.

  13. Geek Mythology. by westlake · · Score: 2

    Microsoft was selling customized microcomputer BASICs to Fortune 500 clients in the mid seventies. MBASIC was the first product for the micro to reach a million dollars in sales. By 1980, Microsoft was offering a full suite of programming languages for CP/M and was moving into operating systems before being approached by IBM. The notion that Microsoft was am insignificant or invisible player in the industry before the IBM PC is just plain nonsense.

    What Gates offered IBM was a serviceable and perhaps more importantly a uniquely affordable 16 Bit CP/M clone + MBASIC, etc., in time for the scheduled launch of the IBM PC. I doubt that the IBM PC team gave a damn how Gates sourced or developed the package so long as it was ready on time.