Comment by tyre
16 hours ago
Very much doubt it’s generational wealth. I’m not sure how much people think open source companies are worth, but the path to VC-scale profitability is incredibly rare.
My guess is that Amazon wants official hosted versions and doesn’t want to go through something like the Redis fiasco with licensing. In that case, they ended up having to support their own development anyway (with Valkey), so they might as well just buy the team.
DuckDB team probably gets a nice package and pay bump, but it’s really unlikely they’re getting hundreds of millions from this.
How much do you really need for generational wealth? In my opinion, if you're more than 10 years away from retirement and received a surprise $1 million, you're setup for the rest of your life and your children as well assuming they don't immediately blow it all when you die (that's what a good trust should be for).
Assuming historical returns, your money doubles roughly every 7 years, so within the rest of your lifetime, that 1 million should turn into at least 8. That's an extremely comfortable upper-middle-class lifestyle on the interest payments alone. If your children don't spend it all, your grandchildren would easily have private jet money by the time their parents retire.
1 mil is not generational wealth in the US. It is a big chunk of money, no doubt. It’ll buy a reasonable 2-3 bedroom house in the city I live in, with nothing left over. No one’s definition of generational wealth involves not touching the money for two generations…
A house you own outright is already generational wealth
The median home price is around $400K. You don't have to live somewhere stupid expensive.
9 replies →
I have to agree, yurishimo's assumption of returns is wildly optimistic.
At a more sane expected return of 5% annually, you get $50k a year to live off of to just keep what you have (or rather, watch it slowly erode in value due to inflation).
That is basically a one person income, maybe two adults if you pinch pennies and live in a crappy apartment or a low-end house in a midwestern suburb.
You can get a lot more lucky with a million bucks than you can with 10k if you gamble, but there are no guarantees. Risk tolerance is the most impactful variable. For those in the low risk tolerance group, I think you'd need at least 2 mil these days. And that's with being frugal, as well as probably not having much left over for kids.
To do that, you would have to never touch the money and invest aggressively. Most wouldn’t do that unless they didn’t need the money, i.e. already rich so not newfound wealth.
You would also have to train your kids to responsibly use the money without demonstrating it, as you’d just be hoarding it. People don’t have a good track record there, either.
I think the best you could do generationally with a million would be to try to invest moderately and draw down a small percentage (2-3%) to demonstrate fully considered use of the money. This would keep you in a middle class income but give you more ability to donate charitably, vacation together, let one spouse retire earlier, solve a financial crisis for a child, etc.
Letting them in on the thinking would give them a good chance to handle a high six/low seven figure inheritance, depending on how the investing goes.
> How much do you really need for generational wealth?
Common definition is somewhere between 1.5 to 5 million per child.
Says who? Ive never heard this and can't find anyone saying this.
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Assuming you're investing aggressively and not touching that money for the next 20 years, with the nominal return of 6% per year, adjusted for the inflation rate of 3% per year, 1M will increase to 1.8M. Not sure how you came up with 8M.
3% real return is… pretty pessimistic. You can about get that on long TIPS.
You said 10 years away from retirement so that’s closer to 2 million than 8.
1 mil as generational wealth? what?
$1 million net worth is massive. You can buy a house in a remote place, invest in companies and live off of the investment perpetually without having to work.
$1M is a newly built condo in the East Bay with HOA >$800/month. Not even an 80 year old 1,300 sqft house in the same area.
I'd agree with that sentiment but that number would be more like $5M (which is nothing in the context of this acquisition). Inflation is not going to relent and having enough to actually enjoy some of that payout to have pseudo FU money and leave enough invested for children and grandchildren (a well-managed trust).
Buying a house in desirable areas is going to be in the ~ $1M range, college is going to be hundreds of thousands, etc.
Assuming historical returns might be a little unsafe at a point in time near the peak of a bubble popping.
> I’m not sure how much people think open source companies are worth, but the path to VC-scale profitability is incredibly rare.
MotherDuck, a semi-competitor of theirs has raised $100mil in funding. DuckLabs has reportedly taken no external funding (so all ownership is with the founders) and was profitable with 30+ employees.
On the sidelines, other companies behind beloved open source products, like Astral, Astro, Bun are getting bought left and right.
With that as a backdrop, I think they should have been able to get quite a good payout.
DuckLabs is the company that does consulting and DuckDB development, the DuckDB foundation actually owns DuckDB the project.
The DuckDB foundation owns some equity in MotherDuck, which is a data lakehouse platform based on DuckDB, and all three have been moving closely together in making DuckDB better locally as well as in the role of a query engine that really threatens a lot of amazon's role in data lakehouses. DuckDB in the hands of a good team means that you can use AWS almost only for storage, instead of using any of the managed services.