One recent study supports the notion that entrepreneurs want to build personal wealth by owning equity in a valuable startup,19 finding that many founders of high-technology startups believe they stand a much greater chance of becoming wealthy by launching a startup than by ordinary employment.20 If many founders really do believe this, it appears they are largely wrong. On average, entrepreneurs earn no more by founding startups than they would have earned by investing in public equity—less, in fact, from a risk-return perspective.21
