*WHY do some people become ENTREPRENEURS?*
Of the many findings + hypotheses, a few stand out
-REJECTING a system that REJECTS them...
"I must CREATE a system or be ENSLAVED by another mans;
I will not reason and compare: my business is to CREATE"
In recent thread on the rule-following/restrictive conformity of some MBA institutions (good criticism/counterpoints expressed, most vocally by sunk-cost + identifying MBAs) I see value in
1) concentrated self-selecting network
Individuals with ACTUAL ability that EXCEEDS the SIGNAL value of their ability (ie they know they are better than employers can tell from credentials)...become entrepreneurs.
-Steve Jobs was rejected for job at HP (b/c he lacked degree)
-Jan Koum was rejected by Twitter AND Facebook (to start WhatsApp 1 year later + sell 5 years later for $19B)...
Also: money matters.
*asymmetric information about ability*
--from a corner food vendor without a HS diploma to a high-tech founder with a PhD from MIT
...to predict WHO is more likely to SUCCEED as an ENTREPRENEUR...
co's offer jobs based on observable SIGNALS
BUT better informed people believing they have more ability than they signal become FOUNDERS claiming more of residual value of their talent; flipping things:
*Asymmetric info about ability* leads existing firms to employ "lemons"
Talented people without as much signal choose to be entrepreneurs
contrasting MUCH of social science
IMMIGRANTS may have had "less credible ability signals" for "regular" jobs
Why friends/family are dominant source of $ at start when asymmetric info of ability is at max