Prior to the FTX debacle, we could have reasonably disagreed on how much to emphasize earning to give as a career path. I personally thought earning to give was underemphasized as a career path (by the community at large) pre-FTX as well but I won’t elaborate on that here. For the purposes of this post, I’ll assume the premise “Funding is back on our list of key bottlenecks” and focus on the “how” rather than the why.
I don’t have a particularly strong view on whether this is better done by gaining a higher proportion of the existing philanthropic pie (ie. via outreach to people who are already wealthy) or by creating new earn-to-givers. Since I haven’t thought much about the former, I’ll stick to the latter in this post. (I recognize that if you have sufficiently short timelines, the former looks more attractive at first glance but i feel confident that enough of the community has broader concerns (beyond AI) to warrant this discussion
What's plausibly stopping more people from earning to give
- Entrepreneurship requires significant risk appetite and overcoming of inertia
- Fairly lonely path with looser bonds to the rest of community
- No clear roadmap on how to acquire enough the requisite skills and professional networks required to substantially increase odds of success.
What can we do?
1. Provide more granular career advice on earning to give paths
The canonical (EA) line here is “Start a company or go into quantitative finance” but that seems far from instructive or exhaustive.
I’m not disputing the claim that the income distribution (even in the developed world) has fat tails. I’d be surprised if entrepreneurship and finance still didn’t feature somewhere at the top after a more thorough investigation. Having said that, we need to give people a lot more granularity than we currently do even within those paths.
More specifically, if a college graduate wanted to earn to give via entrepreneurship, it’s unlikely the best way to do this is by starting a company right out of college. I think the community basically has the wrong mental model here and has over-indexed on Dustin and SBF (as particular examples) and on the perpetuity of an exceptionally loose interest-rate environment that is already starting to fade)]. Even without adjusting for this, the median age of a billion dollar company founder (at the time of starting their business) is 34.
This means there are probably things you can do to maximize your chances of starting a successful business - for example, perhaps roles at growth stage startups could be a good way to map the opportunity set, while also leaving the possibility of generating upside from your current employer’s equity appreciation. This is all to say that we probably need more research and advice tailored to earning to give.
2. Financial and professional support for entrepreneurs (since I’m viscerally averse to using the word “incubator”)
First off, I’m not suggesting we know how to pick winners - we probably don’t and shouldn’t try to. But we ought to do what we can to increase the number of competent people that start companies and make binding commitments to donating most of their equity. Here’s a potential structure (this is just a first pass but the point i’m trying to make is the need to incentivise risk taking without subsidizing ideas that won’t survive market forces)
- Vet applicants (and select for strong operational/commercial experience and/or outliers in domain/technical expertise)
- Provide light funding (<25K per pop) to selected applicants to investigate a few ideas (they probably don’t have to quit their jobs during this period)
- Connect applicants to a network of angel investors and support with the fundraising process (Those who can’t validate their idea with angel funding of at least $50-100k exit the program)
- Founders who find funding through this process sign a binding agreement (perhaps via Founders pledge) to donate at least 90% of their equity (or some number that makes sense so as to still leave the founder incentivised to some extent by personal financial reward)
- Assuming founders choose to pursue this opportunity full time, compensate them for at least 75% of the difference between their previous (presumably corporate) salary and current salary (At this stage founders probably can’t pay themselves much and it makes sense to de-risk this process, especially for people with families) for at least a year
- Connect founders to venture capitalists in the course of this year. No further support after this stage.
3.Make earning to give more legible and higher status
We need to increase the relative status of earning to give within the community. That’s easier said than done but it seems like there’s some low hanging fruit here - for example: (1) increased coverage at EAGs and EAGXs. (2) increased coverage of earn to givers (even if they aren’t yet billionaires) by 80k and other EA podcasts/blogs.
While I believe earning to give via high upside entrepreneurship needs to be our focus, it makes sense to invest resources into more broadly integrating those earning to give via higher lower upside paths and those building career capital, since it’s likely that these are the folks best placed to eventually pursue high upside entrepreneurship eventually.
Interesting, my takeaway from FTX was exactly the opposite. That we should focus on getting away from venture capitalists/acquiring as much money as possible/other mindsets that got us into this mess, and instead cultivate talent that are so dedicated to EA that they're willing to do altruistic work for very little money.
My update from a case of fraud isn't that money can't be made ethically. This isn't to dismiss the possibility of value drift etc, which we should take even more seriously than we have been.
Having said that , a few things:
In general, my update is from the situation is more : we need money but we also need better ops , more interfacing with the real world, better corporate governance and generally fewer incentuousy lookign orgs.
Posted this early, so excuse any notifications.
As someone who is working at an EA org for free, I don't agree with this.
I come from a background of non-EA youth advocacy for multiple cause areas, including education, climate change and animal rights. I have had so many good co-founders go into non impact-focused, high paying roles like consulting because they don't get paid anywhere near the value they provide.
If you want good talent that knows how to plan, takes initiative and knows how to execute, that kind of talent knows enough to apply to dozens of other better-paying roles, and probably enough to secure very high paying roles.
I work for free now because I'm in uni and it's socially acceptable to not make full-time pay. If you underpay a competent person, they will not only face financial pressure, but also see it as a reflection of how they are valued. I don't think this leads to healthy movement growth in the long run.
What percent of expenses in various cause areas are for professional staff in high-income countries?