Economic access has never been better
Economic access (aka the ability to create socio-economic upward mobility for oneself and others) has been limited for 80+ years due to old rules which regulated the system of the haves and have nots since the 1930’s. Now economic access is pretty much limitless.
Let’s talk about the ways people can participate.
Employees & Contractors are the most common and will continue to be. Non-profits, government entities, and companies seek out these fine folks. However, unless employees or contractors are granted equity in the companies they work with, their pay grows linearly, while the cost of living in rapidly growing areas increases exponentially.
Sure, they may get a bonus or even a significant raise, but they are mostly locked in = trading time for money.
Founders / Business Owners & early stage Team members take on outsized risk, but if they succeed even just once, in 5 to 10 years, it can yield more $ than what an employee achieves in a 30+ year career. When that occurs, it often generates massive returns for anyone invested.
For example, Malik McCray, CEO & Co-founder of Simpliworks shared with me that their Ad/MarTech helped start, grow, and exit the startup of a new founder who started with $0 in sales to selling their startup for over $800K to one of the large Amazon business aggregators in less than 1 year. Summary: Simpliworks — a startup that began less than 2 years ago in 2020 is scaling quickly themselves and already helped another business achieve a meaningful exit in less than 1 year. Progress can move at lightning pace in the startup world. (Here’s a super fascinating podcast about those taking a play on Amazon without investing in Amazon).
Investors — let’s separate these into those who have access to the ‘stock market’ (everyone) vs. those who have access to private companies ~7% of the population for 80+ years.
There’s definitely a difference. For example, just look at actual returns between public markets and private markets.
You know what separates the left and right side? Even if you wanted to take the risk on the right side of that chart, if you are not an ‘accredited investor,’ you still cannot legally participate in private equity funds, even with the new rule changes.
A level playing field still does not fully exist, but it is rapidly getting better.
Would opening access help increase the potential opportunity for bridging wealth gaps? Despite the risks, the average +ROI is so high, it definitely looks like it might help.
Educational DNA aided this system of the haves and have nots
The common status quo of what one should do for opportunity is to go to higher education (community college, universities, etc.) to land that shiny degree that helps land a ‘great’ job.
I’m going to piss a lot of people off with my next statement.
That’s lazy and uninformed thinking.
Before you write me off, let me answer the question “Should people seek higher education?” Sure. If that path is the best way to both:
- obtain the knowledge they need, and
- opens doors for the experience they need to start
I sure want my surgeon to have the knowledge he/she needs, but I also want them to have the experience.
Isn’t it ironic that in job interviews, candidates that rise to the top are those who demonstrated a mindset of ownership and execution that followed through experience in the ‘real world’ or on unique projects while they were in college.
So the next time you’re thinking about where you might sit in the socio-economic scale, however you define it, remember, there is a community out there that wants you to succeed and may even put $ and their network on the line to help you achieve your vision, but 1st, you have to take the risk of starting…