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Startups and Scalable jobs

I'm currently reading Nassim Nicholas Taleb's The Black Swan which has been the most intellectually stimulating book I've read since Peter Thiel's Zero To One.

I had once pitched a startup idea to my ex-boss and after patiently listening to the entire pitch, he had said 'An investor will invest money in a startup idea when he hears the pitch and thinks "God! Why didn't I think of that before?" And your idea doesn't evoke that feeling in me.'

While reading the various ideas that Nassim Nicholas Taleb puts across in The Black Swan, I have ended up thinking 'God! Why didn't I think of that before?' Too bad none of these ideas are ones I can put money behind (not that I have the money to do so even if it were).

One such idea is the difference between scalable and non-scalable jobs. Non-scalable jobs are what nearly all of us train for our entire student life (and often once we start working a non-scalable job). These are jobs that require us to keep doing work day after day and be paid for the same at regular intervals. The best and the worst in any non-scalable job don't have a statistically different salary/reward for the work they do (the best engineer at Google and a fresh out of college engineer at Google don't have their net worths differing in the same order of magnitude as mine and Bill Gates's). These are the jobs that doctors, lawyers, accountants, engineers, sales people, prostitutes, theatre artists do. They need to physically be there every time they have to do their work and cannot scale their work to a larger audience. Hence, they cannot scale the rewards they receive to a larger amount either. They can climb up the proverbial ladder and have incremental improvements in the rewards they see.

While it is true that you cannot aim for the skies working a non-scalable job, you are comfortable knowing that your efforts receive proportionate rewards and there's enough to go around for everyone who's doing a non-scalable job.

However, scalable jobs are of a completely different mold. These are jobs that JK Rowling, Jeffrey Archer, Christopher Nolan, Michael Jackson, Bill Gates do. These are jobs that don't require the people doing it to be physically present to take their work to the next set of audiences. JK Rowling only had to write the Harry Potter series once to sell over 400 million copies. Bill Gates had to set up a company once to ensure he continued to earn off it for as long as it exists. Christopher Nolan had to make The Dark Knight once irrespective of how many times it is viewed around the world.

The world of scalable jobs is that of winner-takes-all. There is significant statistical difference in the rewards earned by the best and the worst in a scalable job. JK Rowling became the richest woman in the world by writing the Harry Potter series, while thousands of other authors fail to earn even a single dollar for the books they write. It is the same with actors, musicians and entrepreneurs.

If you have to make a decision based purely on math, using probability, you would opt to land a non-scalable job than to go out on a limb looking to succeed in a scalable job. The math is against scalable jobs. Yet, people do it. Some people are inherently more risk-taking and are willing to try their luck building their own companies or writing their own books.

But you don't have to feel like you're missing out if you're not starting up, nor do you have to start up just for the sake of starting up (and trying your hand at a scalable job). The reason to do it ought to be something other than monetary rewards, because, quite clearly, math tells you that you stand to gain higher rewards (taking probability into account) doing a non-scalable job (aka working for someone) than by doing a scalable job (aka starting-up).

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