Even after the explosive growth of the Internet and computer markets, software is still a tiny portion of the American economy. It’s hard to know the exact percentage, but call it 1%. If this seems low, remember that we know that programmers are only about 1% of the workforce, and most companies employing programmers sell something other than software.

To start a company in the other 99% of the economy, one needs large amounts of capital. Any sort of mass production, or real estate development, or hardware engineering, or original lab research, requires millions (sometimes much more). And most smart, ambitious people don’t have millions, which is one reason why they’ve flooded into Silicon Valley over the last few decades, instead of building Manhattan apartments or starting car companies. The capital requirements are way lower, so it’s easier to go into software, and lots of people do.

But the flip side of that is those who’ve started successful software companies are in a very special position. Out of everyone with their level of intelligence and determination, they’re in the small fraction with access to large amounts of capital. And that small fraction has the other 99% of the economy all to itself. Instead of competing with Larry and Sergey, you could start a company in any of a zillion different fields, and compete with MBAs who never passed calculus.

Empirically, this happens very rarely. (Elon Musk is notable as one of the few exceptions.) Why? Are people, after they get rich, content to just sit around and do nothing? It seems unlikely, because people who founded software companies often start other software companies. From an article about this phenomenon – “Can you name any non-serial entrepreneurs? I can’t think of any of the top of my head… all entrepreneurs seem to be serial offenders. Max Levchin, Evan Williams, Justin Khan, Steve Jobs, Jack Dorsey, Mark Pincus… (and a dozen other names).”

So, why no second hardware startups? The most likely reason is probably the obvious one: after spending a lot of time in software, it’s hard to go learn a whole new field, especially if you’re already rich and don’t have to work to pay bills. But this means that, for anyone in that position, there are huge piles of money sitting around for anyone who wants to get to work claiming them.

(Note: By “hardware”, I don’t just mean silicon chips, but anything that’s physical and capital intensive, like how most small businesses are.)