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The Myth of Risk: Why Entrepreneurship Isn’t as Risky as You Think
- Startup Bell
- Mar 13
- 4 min read
When people talk about entrepreneurs, they often use words like "risk-takers", "daring", and "fearless."
There’s this Hollywood-style narrative that founders bet everything they have—their savings, their careers, their sanity—for a one-in-a-million shot at success. But what if that’s all wrong?
Brian Armstrong, CEO and co-founder of Coinbase, has a different perspective:
"People always think of entrepreneurs as big risk-takers, but honestly, it's not that risky."
Photo: Bloomberg
At first, that statement seems shocking. Starting a company sounds risky. But Armstrong argues that, in reality, it’s not nearly as dangerous as most people think—especially in places like Silicon Valley, where failure is often rewarded, not punished.
Let’s break it down.
The Silicon Valley Safety Net
One of the biggest reasons entrepreneurship seems less risky in Silicon Valley is because of the support system in place.
"If you're a young person, and you get a little bit of money to go start a company, people will write you angel checks for these things, and you can pay yourself a salary."
Think about that for a second. In Silicon Valley, if you have a solid idea and a bit of experience, investors are willing to fund you before you even have a working business.
For example, back in 2004, Mark Zuckerberg dropped out of Harvard to focus on Facebook.
He wasn’t some billionaire genius at the time—just a kid with an idea. But he got his first investment from Peter Thiel, a $500,000 check that let him take the risk without worrying about paying rent.
And here’s the key point: If the startup fails, the founder doesn’t end up on the streets.
"If it doesn't work, you go back to a company. It's often viewed as a badge of honor that you've tried a startup."
In Silicon Valley, having a failed startup on your resume actually makes you more valuable.
Companies prefer hiring people who have taken risks, built something, and learned from failure.
This is the opposite of how most of the world sees failure.
Why Most of the World Fears Failure
Armstrong points out that outside of Silicon Valley, failing at a startup is often seen as a mark of shame rather than a badge of honor.
"In many places in the world, that's not the case. Failure of a company is considered a mark of shame, not a badge of honor."
This cultural difference changes everything.
In places where failure is seen as embarrassing or career-damaging, people are far less likely to take the leap into entrepreneurship. The cost of failure is simply too high.
Take Japan, for example. While Japan has an incredible economy, its startup culture has struggled for years. One big reason? The stigma around failure.
If a Japanese entrepreneur fails, it’s often seen as a personal failure rather than just a business setback. That fear discourages many people from even trying, which slows down innovation.
Contrast that with the U.S. startup culture, where failure stories are celebrated.
That’s the mindset shift that makes Silicon Valley different.
The Role of Capital: Why Funding Matters
One of the biggest barriers to starting a business is access to capital—the money needed to build, hire, and grow.
Armstrong acknowledges this gap:
"Many people don't have the luxury of being able to raise these seed rounds, which in many places in the world, you can't do that."
In Silicon Valley, early-stage funding is relatively accessible. Investors are constantly looking for new founders, and the ecosystem is designed to fund ideas before they even become full businesses.
But in many other parts of the world, getting seed funding is nearly impossible.
This is why crypto and decentralized finance (DeFi) could change the game. Armstrong is a huge believer in how blockchain can democratize access to capital, allowing people to raise funds without relying on traditional banks or VCs.
"Crypto is trying to help that, by the way."
Imagine a world where an entrepreneur in Nigeria, India, or Argentina can raise money directly from global investors using blockchain instead of going through the usual gatekeepers.
That’s a future worth betting on.
So, Is Entrepreneurship Really That Risky?
The answer is it depends.
In Silicon Valley, where failure is accepted, and capital is available, the risks are much lower than people think.
In other parts of the world, where funding is scarce and failure is punished, the risks are much higher.
But here’s the real takeaway:
If you’re in a position to take the leap, it’s worth it.
"If you have the chance to try, why wouldn’t you?"
Even if your startup fails, you’ll gain experience, connections, and skills that make you more valuable in any career.
So don’t let the fear of risk hold you back—because, in many cases, the real risk isn’t failing.
It’s never trying at all.
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