[Question] Should Founders Pledge focus more on recruiting EAs to become entrepreneurs?

[BrownHairedEevee]

There are strong arguments that more EAs who earn to give should focus on starting high-growth startups in order to become billionaire philanthropists.^[1] First, altruists ought to be risk-neutral in terms of the money they earn, and entrepreneurship has higher earnings on average than most relatively stable, high-earning careers.^[2] Second, more big benefactors would diversify the EA movement’s funding sources, which could help democratize power and make the movement’s funding more resilient to catastrophes such as the collapse of FTX and the slump in Meta’s share price.^[3]

It seems to me like Founders Pledge has expertise in entrepreneurship and could encourage more people who are already committed to effective altruism to start startups and provide them support to help them succeed. This is the reverse of what they focus on now, encouraging existing entrepreneurs to donate to high-impact charities upon exiting their startups. Undoubtedly, 80K already pushes some EA-aligned people into entrepreneurship if they are a good fit. What role could Founders Pledge play in this?

1. ^

   The classic case for entrepreneurship-to-give: “Salary or startup? How do-gooders can gain more from risky careers” from 80K (Carl Shulman, 2012)

2. ^

   “Entrepreneurship ETG Might Be Better Than 80k Thought” (Ben West, 2022)

3. ^

   “EA hasn’t sufficiently encouraged entrepreneurship-to-give as a strategy to diversify funding” – in “A libertarian socialist’s view on how EA can improve” (freedomandutility, 2022)

[Evan_Gaensbauer]

My two cents is yes. I agree with most of the recent arguments in favour of more entrepreneurship in EA. One of the exceptions is that I’m strongly opposed to that happening through attempts to earn to give in ethically shady industries right after the FTX collapse. I trust The Founders Pledge about as much as any organization in EA to facilitate the former while preventing the latter.

[DavidNash]

No, mainly because if people interested in EA wanted to become entrepreneurs, Entrepreneur First is already set up (as well as other incubators) to help people do that.

[John_Maxwell]

There are hundreds of startup incubators and accelerators—is there a particular reason you like Entrepreneur First?

[DavidNash]

I know a few people who have gone through EF and have said good things about their program. Also one of the founders has interest in EA and has written about it in his blog.

[MichaelStJules]

By Founders Pledge’s expertise in entrepreneurship, do you mean their pledged members who donate? I wouldn’t guess the org itself would have such expertise, but they could get and share advice from their pledged members.

[BrownHairedEevee]

I primarily meant their staff, but that’s a good point. Experienced founders could mentor those trying to become founders in areas like identifying good business opportunities, business strategy, and business ethics.

[Sabs]

In theory yes, but in practice there might be an issue whereby if you become an entrepreneur literally because you want to dollar-maxx and not because you really care about the thing you’re building, some perverse incentives are at work. For one thing, you might be tempted to take some very aggressive shortcuts b/​c all you care about is extracting maximum value in the shortest possible timeframe, so you might run your business less than ethically and we’ve all seen where that leads.

The other problem, I think, from the standpoint of your returns, is that you’d probably be inclined to sell up way too soon because you don’t actually enjoy what you’re doing. I suspect the EA $$-max entrepreneur-to-give version of King Zuck would have accepted Yahoo’s $1 billion buyout offer in 2006, since he personally would have got $250 million, which was a lot of money at the time. But Zuck—against the inclinations of his early investors & board members, Thiel & Jim Breyer – had zero intention of selling. Apparently Thiel pointed out “well, look at all the things you could do with the money”, and Zuck replied with something like “I’d probably just start another social networking site but I like the one I have, so why should I sell?” And of course, Zuck’s way we got some amazing businesses (and incidentally more EA wealth created along the way via Dustin M). Perhaps we’ll even get the Metaverse, who knows?

Ultimately, do what you love is not such bad life advice, as corny as it is, even if you might have to do some unglamorous chores to get to a point where you can do that thing.