Hiring is Obsolete

Paul Graham’s essay Hiring is Obsolete argues that decreased startup costs have fundamentally shifted power dynamics for talented young people.

Changing Economics

The cost of launching a web-based company has plummeted. “The main cost of starting a Web-based startup is food and rent.” This democratization means aspiring entrepreneurs no longer need investor permission or employer approval.

Young Talent Undervaluation

Large organizations systematically undervalue capable twenty-somethings because they lack track records. “Some twenty-year-olds are more capable than all but a handful of 30 year olds,” yet institutional hiring practices filter them out.

Market Superiority Over Employers

Direct market feedback provides more accurate valuation than employers can offer. Users care only about product quality, not creator age—”On the Internet, nobody knows you’re 22.”

Acquisition as Hiring

Large companies increasingly acquire startups as sophisticated hiring mechanisms, paying for proven teams rather than taking hiring risks.

Risk-Reward Alignment

Young people optimally shoulder higher career risk since failure carries minimal consequences, while potential rewards far exceed traditional employment.

My Takeaway

If you’re young and talented, starting a company is increasingly the rational choice.

What do you think about hiring vs. building? I’d love to hear at persdre@gmail.com.