Want to save your nation? Get rid of poor people!
As entrepreneurs we’re often expected to pursue grand “save the world” projects. We have to be fixing the environment, solving discrimination, or in general - “making the world a better place”.
I always found this mission/social-justice/social entrepreneurship idea to be a little bit of BS 💩, which got me rejected from multiple “entrepreneurial societies”.
But here’s the deal. Business is about money. If you build a profitable business you are a national hero because:
The biggest problem in the world is poverty - people who are barely surviving don’t care about much else. In order to build a great nation you need people that can take care of themselves.
The only way to eliminate poverty is through economic empowerment → people need to be able to become richer on their own.
You’re bringing additional economic value to your nation through innovation or exports which is then transferred to the rest of the economy.
The problem with “poor people”
I was born in post-socialist Bulgaria in 1996
Bulgarians will always remember the period as one of the worst economic periods in our history. Hyperinflation, 24hr lines for gas, banks failing, mafia railing the streets and eventually people raising, and storming the parliament.
That’s a story for another day - I don’t remember much from those times, but what I remember is that the people were SUPER TRASHY 🌈 .
Some of my memories include:
People throwing their trash from their balconies
We had some neighbours who would just throw their trash bags from the balcony. Under their balcony.. 🤦♂️
It’s literally under your own balcony? Why would people do that?!
Dancing bears instead of strippers
There were people walking around with bears, forcing them to dance on the street for money or they would beat them up.
It was a totally normal thing for me to go on the tram and find a bear sitting inside. Nothing out of the ordinary. 🙈
Everyone living in commie-blocks
Don’t get me wrong, commie blocks are awesome - they allowed for everyone to get access to housing, but…
WHY DID NO ONE RENOVATE THEM?
People would have the latest Versace carpet or whatever inside, but nobody would touch the “common areas” as they are for everyone.
Those things still somewhat exist in Bulgaria ( except the animal cruelty 🙏 ), yet, we’ve went a gone way as a nation. We think of the future, we discuss how many cars we want in our cities, we monitor the air pollution, we build new buildings and renovate old ones, we want to leave a better place for our kids. We invest in AI, startups, art and we argue about social issues constantly. Damn… Those 30 years made a difference for the better.
I often find myself traveling around the world and seeing people from other countries throwing trash bags out of their car windows right on the street and I think of the old Bulgaria. What changed?
I believe the main reason for the change is that Bulgarians have become significantly richer during this period ( 10 times richer ).
Let’s play a little game.
I’ll show you street photos from different countries → you tell me which one has a higher GDP per capita?
My argument is not to piss on poorer countries and I don’t pretend Bulgarians are better - we’re still savages in many regards…
I’m just pointing out that the correlation is staggering. In most cases, just looking at GDP numbers you know what to expect when visiting. Go to a rich country and you’ll usually find somewhat clean streets, pleasant roads and well-behaved people. Go to a poor country and you immediately need to defend your girlfriend from catcalls/unwanted hands, focus on surviving the traffic and walk among trash.
But why is that?
We take those things as normal, but we never think why this happens?
Poorer people naturally have fewer things. Why is there more trash on the streets?
How does lower income cause reckless driving?
Why are poorer countries more aggressive/oppressive against women ( in general )?
Now those are some heavy issues. They are complex beyond measurement, but I believe there is a causation beyond the correlation. And that is:
Poor people are assholes
Ok, ok, hold your torches and pitchforks and hear me out:
Let’s define Poor and Rich for the purpose of this argument.
Poor people are people who can’t secure the fulfillment of their basic needs
They either don’t have access to clean air, clean water, food, shelter, energy, information, and healthcare.
Or they don’t have the security that their basic needs will continue to be met in the near future ( e.g. If you don’t know how you’re going to pay for food next month - you’re poor )
Rich people have their basic needs met and secured
If you don’t have to worry about how you gonna make it through in the near future - you’re rich!
Poor people are not really assholes. Poor people live in survival mode.
Take a look at Maslow's hierarchy of needs:
When you’re worried about your electricity being stopped any moment now. When you are worried about what you are going to eat next month. When you and your mom live in an 8sq.m ceiling room with no running water, the daily stress is so extreme that there’s no higher meaning present.
Using the heater is a problem. Eating too much is a problem. Alcohol and cigarettes are a problem. Clothing is a problem. Everything is a problem.
There is no spirituality. There is no thinking about the future, the war, or the planet.
Poor people are generally less concerned about their environment or other people’s feelings. They’re much more likely to resort to quick wins and be selfish as they don’t have the luxury of looking ahead.
Trust me, this is how I grew up. The only thing I could think about was getting some booze/weed and getting fucked up. That’s the only example I had seen. That’s the only future I could imagine. I was 14 years old.
And then… I discovered I can sell pixels on the internet. 13 years later, I get to sit, write and pretend to understand the world every once in a while.
In order to build great nations we need individuals that have their lives in order. That are capable and self-sufficient. That can look beyond tomorrow.
Turns out if you get people about $5000/year in avg. GDP they ( people ) start taking long term view of the future instead of scrabbling around in the dirt trying to get lunch. And you gonna burn everything around you if you have to. But if you got a bit of wealth and you can think over maybe a 20 year period ( which is a damn luxury ) then you can actually start being concerned about the aesthetic quality of the local environment. - Jordan Peterson on the Joe Rogan podcast ( link )
The only way out of poverty is economic empowerment
The global economic pie
Let’s get something clear. Money is not imaginary, it doesn’t grow on trees and is not created out of thin air. Money is a storage of created value.
We can’t “just” give money to the poor and solve the problem.
You can think of money as a 🔋 value battery:
The more value you create for society, the more you charge your battery.
The more value you consume from society, the more you use up your battery.
Value can’t be created out of nothing. It’s always taken from somewhere. For example:
Printing money is taking value from everyone’s battery.
Borrowing money is taking value from the future.
Think of all the economic value / money in the world as a 🥧 giant economic pie. Every country has its allocated share:
Split a country’s pie share by the number of mouths in that country and you’ll get the key metric: “Pie percent per mouth” ( PPPM👄 for short ), or as economists call it - “GDP per capita”. If we assume that a higher PPPM👄 means a better place to live, then the objective is clear → get more 🥧 pie for your country.
How to get more pie
There are two ways to get more pie:
Increase the size of the pie
Increase your country’s share of the pie
Increasing the size of the pie
In order to increase the global economic pie ( output ) you need to make humanity more efficient. You need to create a meaningful innovation that changes the way things are done around the globe for the better. Some examples of such innovations are:
The steam engine
and so on
The main problem with innovation is that innovation is hard. Hard means expensive. It requires a significant amount of pie to be spent on projects that will most probably lead nowhere. Because of its cost, innovation (as a nationwide strategy) is reserved for rich countries. If your country isn’t as rich, then the only logical option is:
Get other countries to give you some of their pie by exporting value
The only realistic way for poorer nations to catch up with rich nations is by exporting products and services that are cheaper and/or better than the competition.
It works the following way:
An entrepreneur comes up with a way to provide a better service/product abroad
Foreigners pay for it
Entrepreneur hires local employees and pays them with the foreign money
Entrepreneur and employees spend their money in the local economy
The local economy has more money ( yay 🥳 )
The most patriotic cause
If you agree with me that:
More exporting business = more GDP per capita
More GDP/capita = a better society
We can conclude that the most patriotic cause you can embrace is:
Empowering local entrepreneurs to come up with export-oriented businesses.
Truth be told, I owe everything to the “trashy Bulgarians” I mentioned in the beginning. Never before in history, a 20-something-year-old Bulgarian kid would be able to create a multi-million company out of their bedroom. I was gifted with a decent education, an internet connection and a mountain of role-models to look up to. I was stepping on the shoulders of giants. All of this allowed me to “succeed”.
Hopefully I can pass the torch forward.
Investing in economic opportunities
All of the above ☝️ is an attempt to put my angel investment “thesis” into writing.
I never understood angel investing ( and still don’t ). I always had a feeling of imbalance between the effort required, the risk involved and the potential returns. And then it clicked:
Angel investing is not really about making money, it’s a form of productive charity. It’s a way to support what you believe in. And if you’re lucky, you won’t lose your money.
This year I’ve invested in 3 companies that empower Bulgarian entrepreneurs to create export-driven businesses:
Cloudcart - Helps e-commerce companies grow their businesses and expand abroad.
Klear - Brings much-needed capital to small businesses to start and grow their ventures.
Coliving Semkovo - Is turning the forgotten village of Semkovo into a Digital Nomad paradise and will soon have hundreds of foreigners in need of all kinds of services around it.
I hope those work out. I hope they give birth to thousands of new entrepreneurs that push our nation forward.
Wishing the same for you and your nation. ✌️
I share my startup experiences on a monthly basis.