Of course - at founding, if $20M goes into the company at $1 per share, and the CEO gets a 10% equity stake (usually subject to restrictions), then the CEO has $2M on paper (or will have after possible vesting.) Real money in this case came from the original investors that flowed into the company in exchange for ownership, but the CEO can't really do anything with his shares yet. At this point the original investors are taking a huge risk with their money - chances are, they just lost $20M dollars, and probably even more, as it can often take a long time of putting good money after bad.

Once a company starts operating, but before revenue (and hopefully eventual profitability), the valuation is trickier. The share price _should_ be the number of shares divided by the sum of all future profit (minus current debt.) Which is hilarious of course, because no one actually knows the denominator.

That original $2M equity stake can grow to billions if the company ends up making something that a lot of people want or need, so the sum of all future profit is large. Or, much more likely, it will be worth nothing, or a modest amount.

Graham's essay kind of avoids the point of whether ownership of a vastly appreciating asset is "fair", if a bunch of other people help that asset to appreciate.

If your life analogy is a closed system competition you’re going to be disappointed.

Most people with millions do not become billionaires. So yes, there is an exclusive pool of players who can play the game. But within that pool there is incredibly different outcomes.

A better analogy is being born as a child of D1 basketball athletes and then making 100 million in the NBA. Being born into a family with no interest in athletics makes it almost impossible to be a professional athlete. Life isn’t fair. It’s still impressive to become one.