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Getting paid to write killed it
Building an audience
Jack Raines started a travel blog and an investing blog during the pandemic, while working in corporate finance at UPS in Atlanta. He wrote about what he was doing abroad with friends and about the wild things happening in financial markets. His Substack kept growing, so he doubled down on media: he worked for the Liquidity newsletter during business school, then took an offer from Robinhood to help build a media startup called Sherwood News.
When it stopped being fun
Writing had been fun when it was his own thoughts on his own platform, building an audience. Once his paycheck depended on turning out columns inside a structured corporate environment, it stopped being fun. He also couldn't see long-term income and career progression in traditional media, while investing, the other thing that pulled him, was just as stimulating and offered higher earnings and more options.
What writing really gave him
He had reasoned that because he loved writing, his career should be writing. What the writing had actually given him was a good network. Venture capital is a deal flow game, and a network with access to founders who are starting things is worth far more there than in media. He works at a venture capital fund now, and he still writes.
Why can pay make a loved activity feel like work?
In a 1973 experiment by psychologists Mark Lepper, David Greene, and Richard Nisbett, preschoolers who enjoyed drawing were promised a reward for it. Weeks later, the children who had been rewarded spent less of their free time drawing than children who were never paid. Researchers call this the overjustification effect: an outside reward can replace the original enjoyment as the reason for doing something.
Why does a network matter so much in venture capital?
Deal flow is the stream of investment opportunities that reach a fund, and in venture capital it is the raw material of the business. Returns in the industry are concentrated in a small share of investments, so seeing a future breakout company early matters more than analyzing an average one well. Founders tend to bring new companies to investors they already know or who come recommended by someone they trust. People who know many founders are therefore often introduced to deals before the open market sees them.
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