Okay, as someone who has lived in the "heart" of Silicon Valley for a few decades I'll take a shot at this.

To be fair, I didn't appreciate how unusual it looked until I helped a friend start their business in Illinois and saw what they dealt with at a bank.

You are correct in your assessment that articles like the one linked here are pretty standard business explainers. The interesting thing for me is that it really is just math and systems so it "should" be interesting but for a lot of folks they don't seem interested and just want to sell product.

So at least part of the venture community has convinced itself that it knows how to "productize" anything, if they just had something to work on. And along comes a person with an idea and hope. The venture capitalist (VC) thinks, "I'll provide the business sense, this person provides the creativity and the elbow work, and we'll split the profits." That can work out spectacularly well for the VC where they invest $X and get back 10 - 100 time $X in wealth. It doesn't always work out, but if it works out enough times, the VC can turn their money into more money faster that way than with say investing in government bonds.

In Silicon Valley this works because of two things, one there was a tradition of providing equity to employees which, when companies grew, put a lot of the wealth generated in the hands of individuals rather than companies. And secondly, California had some pretty good laws on the books about disallowing "non-compete" employment agreements so people who thought they could do the same thing their company was doing, only better, could go out and start a new company doing the same thing without too much risk of getting sued.

Having lived here I can tell you that 20 - 30 year old people are much more willing to invest in something risky than 50 - 60 year old people. So getting that wealth into younger hands adds to the risk tolerance.

To this point: Or maybe I am just poor and don’t get how people with large amounts of cash think. I expect it is a scale thing.

Imagine you have saved enough to pay for all your kids college education and you start your "retirement" fund. And you save money in that until the returns on that fund are actually enough to provide you with the same income, and in the US buy you the same medical coverage, you are currently experiencing working. Now you can "leave your job" and have a lot of free time. (It doesn't mean you can buy a yacht or an airplane and party all the time, just that you're new lifestyle looks like your old lifestyle with the single exception that you don't have to go into work every weekday). Now you end up with a few million $ more for this "third" account. What to do with that? Well a lot of people feel comfortable "gambling" some of that on new ventures because if they lose it, it won't change their life, and if they get a big winner, well it means more things they can try.

So to understand it, you have to imagine that you've got enough savings for all of the life expenses you expect to have going forward, and you have enough savings on top of that such that those savings are providing the equivalent to having a good job (pay and benefits), and now you have savings on top of that.

In the current batch, there are estimates of >100,000 former Google, Apple, Microsoft, and Facebook employees are in that position today. Money did a story on how the density of billionaires in San Francisco was the highest in the world [1] (post Crypto-crash I'm guessing this number went down :-)).

So why do young millionaires and billionaires invest in crazy ideas? Maybe because it is more exciting than having a few million dollars sitting in a bank account doing "nothing"?

[1] https://money.com/san-francisco-billionaire-density-income-i...