We're constantly told that the wealthy are society's great entrepreneurs. Without them, we're told, there would be no jobs, no business, no innovation. In this eighth video in our series on wealth, I explain why that's a myth. The rich don't create. They're not entrepreneurs. They preserve, protect and hoard instead. It's time to stop believing their PR myths.
This is the audio version:
This is the transcript:
Are the wealthy the world's great entrepreneurs?
That's the myth that we're told time, after time, after time.
And we're told as well that without the wealthy, we would have no enterprise in our country.
There would be no business.
There would be no innovation.
There would be no employment.
And we would all be living in poverty because it's their skill upon which we are dependent, and they are wealthy because they're so skilful.
This is the eighth in our series on wealth, and I've already dismissed this idea that the wealthy are wealthy because they actually were such great entrepreneurs, because, as I've explained, they're actually hoarders of wealth and not innovators of wealth.
But I want to, in this video, particularly attack this myth that the wealthy are entrepreneurs, because I simply can't find any evidence to support it at all, and we entirely need to reframe this issue to understand if there's any value that the wealthy now really add to our society.
As I've explained in earlier videos, the wealthy worry more than anything else about losing their wealth. The thing that haunts them, day in, day out, and if they wake up in the middle of the night, is that they might actually cease to be wealthy.
They are petrified of the consequences of being 'one of the rest'.
That is the fear that they have, and this impacts every aspect of their behaviour. After all, the wealthy want us to know they're wealthy.
They do it by flaunting their wealth, and we've discussed that. That's what they do when they consume conspicuously. The message they're sending out is, they're different.
And this process of sending out that message is an incredibly time-consuming job. In fact, they really haven't got time to work, and we can see that in what they invest in.
The wealthy don't live off entrepreneurial companies, and they certainly don't live off the profits they make by creating those companies.
They live off rents.
They live off interest.
They live off dividends.
They live off royalties.
They live off license fees, and maybe even appearance fees, because I suspect quite a number of them would like them, if they can get them, and they have the looks to do it.
But the point is, they don't create anything, because actual work isn't on the list of things that they want to do. They think they're above that, and anyway, there's a big problem for the wealthy when it comes to entrepreneurial activity, and that is taking the risk of undertaking entrepreneurial activity by creating a business is inherently risky, and the wealthy hate risk, because the downside of entrepreneurial activity is that the wealthy will lose money, and downsides are what the wealthy want to avoid, most of all, because losing wealth is what they hate most of all.
And that's why the wealthy invest in safe assets and why they sell out of their trading companies as soon as they possibly can, as we have seen time and time again in the UK economy, in particular.
Their aim is to minimise exposure to market volatility and maximise steady income streams that they can enjoy into perpetuity, from now to forever, as far as they're concerned. So they fear innovation because it threatens their well-being.
And they fear innovation for another reason. They fear the embarrassment that failure might bring, so hoarding and not growth is their priority, and we end up with something that I might call 'The sellout culture'.
The wealth that is created by companies is not something they want to partake in. So the moment they get close to having success in any entrepreneurial activity, they'll flog that company to any old buyer because what they want to do is guarantee that they can maintain their wealth into the future. And this is crippling for the UK economy, by the way, because we know that most of those companies are sold to competitors who then either kill them or take the ideas abroad. The role of the wealthy in preserving wealth and killing off entrepreneurial activity in the UK is deeply destructive.
Who are the real entrepreneurs, then?
Well, the real entrepreneurs are not the ultra-rich because they've got too much to lose. The real entrepreneurs are those who can afford to take risks, and the people who can afford to take the greatest risks in life are those who have very little to lose.
True creativity comes from need and not from excess, and you can see that with musicians, for example. The first three albums were successful, they're good, they're edgy, and very rarely is that seen in those that follow, because comfort takes away everything that made them innovative at first. I know there are exceptions, but by and large that's true.
If you want to find real entrepreneurial activity, go out and look for young musicians and buskers, or creative writers or students who are piled up with debt, but who have a good idea, such a good idea that sometimes they're even willing to drop out of university to pursue it. And then look at those who have a desire to prove themselves, but not to make money, because their idea is so overwhelming that they have to create the product that they think is important to other people, and their belief in it is what creates the value that will eventually, in some cases, make them wealthy.
But all of those people start without wealth.
In fact, it is trying to secure funding from those with wealth that is the biggest problem for entrepreneurs in the UK. That is the difficulty that we as a country face, which the government could address, but chooses not to do.
Entrepreneurs take risks because they're born to do so.
The wealthy don't take risks because they're trying to preserve their privilege.
These two groups are the exact opposite of each other. One innovates and one refuses to do so, and in fact, they don't want others to innovate because they then might become wealthy and that challenges them.
So this idea of the wealthy entrepreneur is an oxymoron. They don't exist. They don't want to be entrepreneurs because that threatens their well-being. They're just too frightened to undertake the role.
So the myth of the job creating rich is also just that; it's also a myth. The rich do not drive wealth, and in many cases, they want to stop it from progressing.
So let's just drop this idea that they're rich, they're entrepreneurs, they're gifted, and somehow or other, our society will collapse without them, because it won't.
The real entrepreneurs are here already.
They're just sitting on a street corner, or working as a barista or studying in a university library right now. But that's where you have to go to find the person who's really going to create the jobs of the future in this country. Just don't look to the wealthy, because they've got no interest in doing that.
Poll
Are the wealthy entrepreneurs?
- No (65%, 121 Votes)
- I am persuaded by you that they aren't (28%, 51 Votes)
- Yes (4%, 7 Votes)
- I don't know (3%, 6 Votes)
Total Voters: 185
Loading ...Previous videos in this series:
The Wealth Series introduction: Do we need the wealthy?
Wealth Series 1: What is wealth?
Wealth Series 2: Who are the wealthy?
Wealth Series 3: Why are the wealthy so wealthy?
Wealth Series 4: Why are the very wealthy so very wealthy?
Wealth Series 5: What are the wealthy worth?
Wealth series 6: Wealthy, or worried?
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Hurrah to all that.
A thread running through your post is monopolism and how the sellout culture enables/sustains that.
People and companies with good ideas find it difficult to get funding in the UK.
We used to be members of the European Investment Bank. I have little idea how that works or what they support.
But do we, or should we have a state investment bank dedicated to that?
No, just sham one.
I’ll say it again. The wealthy are not homogeneous.
Some inherit significant wealth and others create it for themselves, through success in business or sport or writing or whatever. Some own large amounts of land, and some own and run significant businesses – not just Amazon or Facebook or Dyson but also many businesses worth tens to hundreds of millions.
Many of these people are absolutely invested in the ongoing success of their own or the family’s business, even into the fourth or fifth generation (or more). They may have the financial resources to risk some capital on innovations, looking for greater returns, secure in the knowledge that they can afford to lose the money if it goes wrong.
They may also have significant philanthropic aims, often to the detriment of the business or their wider wealth. Love him or loathe him, but Bill Gates and his foundation will make a real difference.
I am addressing what is presented as a homogenous truth with a justified response, Andrew.
In the real world, this is necessary. Nuance is not for headlines and I am addressing headlines.
And you are finding exceptions that also prime the points made previously about becoming wealthy through exploitation. So I am not sure you’re winning this one.
“If you want to find real entrepreneurial activity, go out and look for young musicians and buskers, or creative writers”…
So these people set up their own building firms, are engaged in medical research to develop a cure for disease, are developing software to be the next Microsoft, have finished engineering degrees to build something new or build something more efficiently, or are building an expertise in finance to set up a hedge fund. I don’t think they are do you? And it is the people I have mentioned who will create employment for others and grow the economy.
Have you listened to a word I said?
Are those people wealthy? No.
Might they become wealthy? Yes.
But they did create jobs as wealthy people? No.
So what are you disagreeing with me about?
You seem determined to support what I am saying.
I do not say things by chance. I work things out and then speak. It’s a pity not everyone does.
Jeff Bezos started in a garage and now employs 1.2 million people..enough said.
Watch the video on how the wealthy get wealthy then – and then note the abuse of monopoly.
Politely, exploitation is not pretty, howeverr you dress it up.
Necessity is the motherhood of invention. In my professional life I have met a few very wealthy people and, generally, most of them did not start out with the aim of becoming wealthy. Instead they had a good idea, sometimes pursued obsessively, which when realised then made them shed loads of cash. Remember Percy Shaw?
But they are the exceptions.
Sadly I have to agree with you on that in today’s financial world. We seem to place greater emphasis on financial manipulators than we do on genuine creators be they inventors or artists. I sometimes wonder, over the last few centuries, how many people have made a living, be they stars or stagehands, out of the creative works of a playwright from Stratford upon Avon?
More power to Percy Shaw. But note that he made money as a monopolist having patented his cat’s eye. Do we really think that no one else would have come up with the idea of reflectors if he had not? That’s the problem with patents, that they grant a monopoly to the first person to file a claim on the invention (they need not be the first to invent). That’s also the positive side of patents and at least they only last 20 years from filing (unlike copyright which persists for many many decades – far too long). And I do question the key feature of the cat’s eye, that it was self cleaning. If you note reflectors today do not use the cat’s eyes self cleaning principle.
Agreed
Agree. In my opinion there are a certain set of circumstances that stimulate innovation, which in turn might create entrepreneurial endeavour capable of creating jobs:
1) Physical challenge, all types of what we disparagingly refer to as ‘Disability’
2) Crisis situations including Conflict
3) Resource poor environments and Poverty
Essentially Challenge, hence the saying “Necessity is the Mother of Invention” – In my travels I discovered that Africa has the motherload of necessity!
Not entirely, but certainly true in many cases.
Speaking as a retired entrepreneur, I agree with Richard. Most true entrepreneurs may become a little wealthy, but there is always the urge to re-invest in the next crazy idea.
The only way to become super-rich is by exploitation… of workers, of legal loopholes, of customers, of government support or of other peoples’ intellectual property. For example, Richard Branson’s first big score was a tax fraud.
https://slate.com/business/2014/05/richard-branson-tax-fraud-how-a-youthful-indiscretion-helped-create-a-billionaire.html
Thanks
To quote Jon Goodman’s character in The Gambler – Frank: You get up two and a half million dollars, any * in the world knows what to do: you get a house with a 25 year roof, an indestructible Jap-economy *box, you put the rest into the system at three to five percent to pay your taxes and that’s your base, get me? That’s your fortress of * solitude. That puts you, for the rest of your life, at a level of * you.’
That’s it, precisely.
Hi Richard, I wonder if you could comment on the possibility of a financial transactions tax? My understanding is that the vast majority of transaction made by banks, hedge funds etc in the “casino economy” could be taxed and this would raise substantial funds.
Some time.
I discussed options in The Joy of Tax.
In their report “Billionaire Britain 2025”, the Equality Trust writes (May 2025):
“.. the UK’s billionaires are increasingly drawing vast wealth from extractive sources that have nothing to do with guts or gumption. Many of these sources are causing real harm to the UK’s communities. [..] wealth sources are fundamentally extractive, adding little real value to the UK’s society, and allow huge profits to be realised by sitting back and allowing values to rise. ”
Source: https://equalitytrust.org.uk/evidence-base/billionaire-britain-2025/
Agreed
By your own definition, this is facism
You’ve identified a subgroup and have pinned society’s economic woes on them
Next you dehumanise them. They’re not like you and I.
You wont print this but we see you.
That’s actually quite funny really, when the whole point about the wealthy is that they want to be the ‘other’ and that’s what I am pointing out.
And I note the threat. Do you always make them?
Nvidia was founded by Jensen Huang from LSI and two chaps from Sun Microsystems who had graphics experience. It was initially funded by their personal savings and $2 million VC from Sequoia Capita. Its market cap is currently $4.23bn. Is he an entrepreneur? Yes. Has what he has done contributed to society? Yes.
He was an entrepreneur when he set it up and he is now.
Yes he was an entrepreneur.
And he was not rich.
What I said is the rich are not entrpereneurs.
I did not say entrepreneurs cannot become rich.
And then, I pointed out, most of them either a) exploit monopolies (all tech companies do using patent law to create barriers to entry) and b) overprice.
So, now I very strongly susp0ect his biggest motivation is remaining wealthy, as I have explianed is the obsession of the ealthy.
Why can’t you trolls either read or understand plain English arguments? All you have done is furiously agree with me.
What an absolute load of bollocks – you make claims that don’t stand up to basic scrutiny – the top 10 richest people in the world are all highly successful entrepreneurs which totally dispels your claim, and yet you still maintain you are right and other people can’t understand plain English?
Have you ever graciously accepted that you might be wrong, or is abuse your only form of response?
Were they rich when they started?
If not, you make my point for me.
Entrepreneurs might get to be wealthy, usually via exploitation, but thehy don’t start rich. And that is what I was saying. You were too blinded by your prejudice to notice that.
David Byrne responds:
The growth of the financial “industry” , mainly over the past 50 years is well documented. And your thesis is correct.
“Predator Nation”, written by Charles H Ferguson is subtitled ‘Corporate Criminals, Political Corruption and the Hijacking of America’. All the guilty are named, and their MO explained.
I would add, greed.
It’s happening here and now and the UK is being shafted.
Latterly, we have seen the bad actors courting Rachel from Complaints and The Boy Wes, offering economic growth and implied personal benefits.
Entrepreneurial genius my bum!
Thanks
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