The New Tech Millionaires
When millennials get rich
Techies with newfound wealth are often practical with their money, but can also lose friends and relationships along the way
The high tech’s “easy to come by” fortune is often discussed, however, vocational psychologist Efrat Agmon wants to emphasize that it does not really happen overnight. "The whole ecosystem is built in that direction, and its workforce has been raised to see it that way. But the process of an IPO or acquisition takes six months to a year, so they have time to think about it, and sometimes they even get to this point with money they previously made,” Agmon, the former Head of the Diagnostic department at the Adam Institute explained. In her work, she meets with quite a few people who made their fortune in high-tech, "in my clinic, for career counseling that specializes in middle-aged professions, and also guiding managers within organizations, startups, corporations, and the bodies that support them, such as family offices and real estate agencies."
The brewing time, Agmon said, is just a part of the good preparation that high-tech workers undergo ahead of their meeting with the capital. "They also always come in pairs or threes, not alone, so they do homework before they come."
Some of them are very young, under 30, with no families. What does newfound wealth look like in a millennial generation?
"These are practical and realistic people, so they buy apartments, it's not just that the apartment market is booming. They do not think they know everything, they consult, they turn to investment managers, and they are usually suspicious, so they do not flash their fortune, it is even a little embarrassing for them, they prefer to keep a low profile. Most of them are private individuals, they have no interest in rubbing shoulders with moguls, gain access to state institutions, or influence politics, their ambition is to live a good and quiet life. However, they are involved and socially active, and pursue goals that are meaningful to them so they invest money or energy, for example, in sustainability or many other things."
And yet very big money at such a stage in life also poses challenges, no?
"Yes, sometimes they do not fully know their preferences, what kind of life they want to live, and they need to suddenly decide, understand how they will want to raise their children and so on. But we must also distinguish between those who earned a million shekels, or three million shekels, and usually use this amount to buy an apartment and a car, become a stable middle-class person and do not go wild because it is not a life-changing sum, from those who make tens and hundreds of millions of shekels."
And when it is tens and hundreds of millions, what does it look like?
"It is more complicated there. I know people who have lost their minds, but most of them keep working at their companies. Even then the transition is difficult because when Google buys you or Amazon invests in you, you have to get used to working according to the norms and rules of a large corporation. They have no aspirations to climb to the top of the corporation so they usually stay for the period they committed to under their contracts, and move on. We have to realize that these people are entrepreneurs at heart, and their main professional motivation is to invent and innovate - money is just a by-product of these things, so they usually just move on to the next startup. Only very few of them just go and lay back on some island. On top of that, they are good kids, from good families, so many of them help their parents and siblings, buy them an apartment, for example. This is a unique phenomenon.”
“What is clear is that in the long run they are not happier and do not feel more secure and stable thanks to this money. It does not create any peace of mind or anything like that, and they continue in the race because their real satisfaction is not from buying a yacht, rather, from developing an app that will wow everyone, this is their main emotional need."
How does money change their relationships with their social circle? When you want to go on an expensive vacation or to a fancy restaurant and friends can only meet you for hummus?
"A lot of times your friends are the ones who made the money with you, they usually go together, all the friends from 8200, so there is no problem. When the friends did not go the same route, I think over time they move away. Even if they say it is not true, in the long run, there are no friends left who have less money, because the gap creates unrest, it's not easy. Gradually, it will be more and more comfortable for them to be in an environment similar to theirs so as not to create this discomfort."
And how does this affect the relationship?
"When the person who works in high-tech and brings the “big bucks” is the woman and not the man, there is a different kind of unrest, and there are quite a few divorce stories following something like this. You have to learn to get used to money."
In the discussion about the new rich, there were many reactions that referred to their relations with the state, especially regarding taxation. Things in the spirit of "We hold the whole economy, what do they want from us, everyone is welcome to work hard like us and earn the same."
"These are exactly their statements - we pay taxes, we bring a livelihood to a great many people, we are the locomotive that drives the economy. But at the end of the day, only about 10% of the population works in high-tech."