9 ms·

I think the VC world's obsession with growth has tainted how we (me included) view things, especially stuff like social media. There is a fixation with growing

I think the VC world's obsession with growth has tainted how we (me included) view things, especially stuff like social media. There is a fixation with growing and doing it rapidly that I believe is harmful. I don't know when this switch flipped, but I've felt it gradually building up over time. Things can just be what they are, grow naturally and then die naturally. I suspect that injecting cash and attempting to achieve an unnatural growth is probably not good for both the quality of the product and the long term stability of it. I would love to see more niche things grow organically and fill a role for some people, at some time and not try to be everything for everyone. Because when that's the case, does anyone really enjoy it?

djbusby 3y ago
For me, I think the big mind-shift was the dot.com explosion/implosion. VC driven growth at all costs ("GaaC"), monetize later. That's when I first saw it. Prior to that what I remember was mostly building a small business. On one you grow and grow fast, needing multiple rounds, to exit. The other was build a business with one or two rounds, then have a product that generates profit. The GaaC method also means spreading the company into all kinds of things - maybe away from the core - which I think causes loss in the original value prop.
- cmrdporcupine 3y ago
  It's funny because having lived through that, we all thought the implosion of .com companies that worked this way, during the .com crash, was a repudiation of this strategy. But it came back within 10 years, and stronger. I also remember clearly that at the beginning of things with Facebook there was a strong sense from the press of "how the hell will this thing ever make money?" and big questions like that around the IPO. Hell, there was that going on for Google around their IPO, too. There was a brief period from about 2001 to 2007 or 2008 or so when there was perhaps more responsibility to try to start on a more even revenue-earning foundation with sounder business plans. But that all blew up in the 2010s. It's possible this was all tied into the massive cuts in interest rates, and QE etc after 2008 that made debt really cheap.
vinyl7 3y ago
It has really made me pessimistic about tech and products in general. There's the free and great stage, then the market is captured, then enshittification, then death. I don't get excited about new products or new tech because I know the cycle. Hype then bust. New thing comes out and I'm just meh about it, because it'll bust soon enough so it's not worth getting invested in it. Or new version will come out next year and break what I was used to, or it'll be an implicit subscription of having to buy new thing every year. But it's not really going to fix itself because it seems like everyone else loves the dopamine rush from the hype cycle, and they don't really seem to care about how ephemeral everything is.
- lapcat 3y ago
  > It has really made me pessimistic about tech and products in general. There's the free and great stage, then the market is captured, then enshittification, then death. Mark Zuckerberg an hour ago: "Our approach will be the same as all our other products: make the product work well first, then see if we can get it on a clear path to 1 billion people, and only then think about monetization at that point." https://www.threads.net/t/CuW5-eWL34x https://www.threads.net/t/CuW5-eWL34x
  - wavemode 3y ago
    lol it's so explicit at this point he's the world's leading expert on the enshittification cycle
    - rchaud 3y ago
      It will always be a fascinating piece of historical trivia that Zuckerberg was represented as an iconoclastic hacker in The Social Network, when he had already turned into a turgid adtech executive by the time the movie came out.
    - mym1990 3y ago
      The ironic thing is that he lists monetization last, but simply by uttering that sentiment he tells us that they are really thinking about monetization first, aka the end goal of the product.
skizm 3y ago
> I suspect that injecting cash and attempting to achieve an unnatural growth is probably not good for both the quality of the product and the long term stability of it. Right, but that's not the point. VCs (and most founders / anyone holding equity) just want to get our before the hockey-stick graph starts turning into an S-graph. The product itself is mostly irrelevant (to everyone except the users that is).
- MSFT_Edging 3y ago
  > but that's not the point. VCs (and most founders / anyone holding equity) just want to get our before the hockey-stick graph starts turning into an S-graph. Most efficient system in the world, ladies and gentlemen
sneak 3y ago
Public social media is one to many publishing. Mass publishing is more useful and valuable the more people you can publish to at once. It has nothing to do with VC. "Don't pick fights with people who buy ink by the barrel" long predates vulture capitalists.
- JohnFen 3y ago
  > Mass publishing is more useful and valuable the more people you can publish to at once. Absolutely, but that was happening long before the likes of Facebook, Twitter, etc., came around to monetize it and convince people that they are the only ways to do it. They're cultural parasites.
_bkyr 3y ago
I believe it's really the outcome of capitalism and greed taking something that was organic (forums and chat) and monetizing it to death. Facebook monetized your family and friends, Instagram monetized your vanity / creativity, etc. You can see this incorporation of the internet with the classic Craiglist image: - https://scalecuts.com/wp-content/uploads/2019/04/Craigslist-Marketplaces.png https://scalecuts.com/wp-content/uploads/2019/04/Craigslist-... - https://mediacloud.theweek.com/image/private/s--X-WVjvBW--/f_auto,t_content-image-full-desktop@1/v1608244092/craigslist.png https://mediacloud.theweek.com/image/private/s--X-WVjvBW--/f...
- gen220 3y ago
  I would agree with greed but push back on capitalism. There are many ways to be a capitalist. Greed is a common choice, but there are more humanist approaches, too. From your example, Craigslist is itself is a capitalist institution, making >$100mm/year. Patagonia, Wikipedia, King Arthur Baking Company, Darn Tough Socks, Lodge cookware, are all capitalist too. I think it's important for entrepreneurial-minded folks to have positive role models – it's possible to develop wealth for yourself, your customers, your employees, and your environment, and to do so with respect and dignity. In fact, a well-operated business is probably the most effective vehicle for having an outsized impact in your community, so defined.
ilrwbwrkhv 3y ago
While this is true and I think most VCs are idiots, there is a natural phenomenon of the internet which allows for exponential growth and which means that startup = growth is a very real thing. What VCs and a lot of startups try and do is fake the actual utility of a product through forced marketing and Glamour.
- mattbuilds 3y ago
  Yea I actually think it's similar to something that happens with my 2 year-old. He thinks putting shoes on means we go outside. So when he wants to go outside, rather than saying "outside", he goes and gets his shoes. The internet' scale allows great products to grow exponentially. A bunch of great software, sites, and tools took off and grew at a rapid rate. But we took the wrong lesson from this and thought "rapid growth=great product". So VCs have put growth above everything else, and are hoping they can figure out a product after, like a 2 year-old thinking that putting on his shoes will mean he gets to go outside.
hinkley 3y ago
> There is a fixation with growing and doing it rapidly that I believe is harmful. I don't know when this switch flipped. Gradually? I happened around 1995 and it’s only ever slowed down for recessions. It’s not a trend of companies it’s a trend of funding sources and strategies. If you take fifty million in funding, those guys want it back. And they want it back 10x. So when your favorite little company takes a funding round that is five times more money than they’ve ever seen total, let alone at once, your favorite little company is about to change into something ugly.
xeromal 3y ago
This is a huge tangent, but I've started harboring similar feelings for video games. Go read comments for the latest game and 90% of the comments will be about item drops, skins, loot drops, whatever. It's absolutely mind boggling because all those things IMO suck the fun out of the game which it to kill something, kill someone, or explore some world.
- cableshaft 3y ago
  Just stop playing most AAA or mobile games and that should solve most of that for you. The exceptions being the God of War series, the Mario and Zelda series. I still get excited for those. And probably the next Elder Scrolls or Witcher game. But other than that, lately I've been far more excited about the Persona series, Nier Automata, Spike Chunsoft games (especially Danganronpa), The Witness (a bit older now), The Outer Wilds, Subnautica, Slay the Spire, Inscryption, and Vampire Survivors. Tears of the Kingdom is probably the best pure exploration game ever made, with Outer Wilds being better in some ways, as it's simulating an entier solar system in real time and has some really clever ideas in it, but it's a smaller game overall. I think I pretty much fully explored Outer Wilds (except the expansion) in 20 hours, I've aleady put in 80 hours into TOTK and I've seen maybe 40% of the content so far.
- EA-3167 3y ago
  The key is to just pass on those sorts of games, because there are still plenty of others that don't play with the customer that way.
  - xeromal 3y ago
    I'm actually arguing against the gamer in this case. For the most part, I enjoy those games because I don't work myself up over loot drops, skins, etc.
- emadabdulrahim 3y ago
  The mobile gaming era pioneered the approach where game design is fundamentally driven by the game's monetization mechanics.
tempodox 3y ago
> I suspect that injecting cash and attempting to achieve an unnatural growth is probably not good for both the quality of the product and the long term stability of it. The people getting rich with these methods don't care about quality or stability.
nottorp 3y ago
Most of HN would always assume you have to compete and capture the market, no matter what you're talking about.
- mattbuilds 3y ago
  If you are taking hundred of millions in funding, sure you need to capture the market of "all the people". If you build something that's just for a certain group of people, you can compete by just having a better product that specifically addresses those users needs. Look at HN, I know, run by a VC and it's not without some issues, but it is still better than most forums and social media to me specifically because of what it doesn't try to do. It has a specific goal and doesn't feel the need to try and extend beyond it. My ideal is that in the future we will more communities like this, where it's built to address a group of users needs and not try and expand beyond it. Where the content and information is shaped in a form to meet the specific needs of the group using it and not generalized into the lowest common denominator so ad sales can go up. It feels unlikely at this point, but I still have hope.
davidguetta 3y ago
> Things can just be what they are, grow naturally and then die naturally. I suspect that injecting cash and attempting to achieve an unnatural growth is probably not good for both the quality of the product and the long term stability of it. Maybe this actually IS, the natural way to grow and die for a global social network
marginalia_nu 3y ago
I think it's a problem outside of the VC-adjacent space too. There's a sense that if you can't solve a huge societal problem (ideally several), it's not worth doing anything. It's really disempowering mindset because most of those problems are really hard to solve. It's like all the focus is on what effect the thing you're building will have on the world, rather than just building something because you think it would be kinda neat if it existed. The latter type of projects are the only sorts of projects I've had any success with. It's really liberating to not have to play some five dimensional chess game guessing what will make other people behave in certain ways and just using your own judgement to build what you like.
- badtension 3y ago
  Oh man well said, I had this uneasy feeling while reading your comment. I think the world is fucked, especially in how it's planting incentives in our brains. For girls it's clothes, make-up, being fit. For guys it's cars, games, sex. And of course there's general consumerism that doesn't gender-discriminate anyone. For tech people there's something else I hate with passion: creating images of great, world changing people. We aspire to be Zucks, Musks, Gateses, Holmes (yes, theranos). It's always bullshit to sell something or gain political power but the damage is done anyway. It's hard to live a simple life and enjoy simple things when everyone around expected you to look up to them and change the world. Many people believed their narration and became sociopaths that maximize gains on every opportunity. Even I was very drawn to "growth hacking" before. Now I see how crazy it all is.
- gen220 3y ago
  > It's really liberating to not have to play some five dimensional chess game guessing what will make other people behave in certain ways and just using your own judgement to build what you like. I think people underrate this idea, way too much. Humans are a pretty diverse set of people. But we're similar enough that in a population with ~10^13 people, there's probably 10^4 people who are pretty much clones of you, in terms of your preference, taste, etc. With the internet, it's never been cheaper to find them. Preconditioned on it being you or me, 10^3 of those people are probably browsing this website, for example. I hope the fluctuations of fashion lean more towards assigning social value to smaller, more sustainable builders. The migration in that direction deserves to be bigger. I observe it happening personally, but tech media is lagging significantly behind, mainly because these people don't spend money on advertising or PR.
konschubert 3y ago
Many companies fail because they take on investment and then have to grow into their valuation. The fast growth creates enormous inefficiencies inside the company, because management and tech cannot keep up. This often mans that the company eventually has to shut down.
- renegade-otter 3y ago
  On more than one occasion I've worked in places where we were asked to be at our tidied up desks because VCs were about to be paraded through the office. Every time there were more of us. Basically, "look at how we are burning through your money by hiring all these people. Growth!" Now, the actual growth, daily active users and all, that is an area of rampant fraud, but VCs seem to be OK with it until the company runs out of runway. THEN it's a total scandal, even though all they need to do is pop the hood for 5 minutes to see how the numbers are arrived at.
Guest9081239812 3y ago
I understand growing rapidly, especially for a social network, where you need to quickly reach a certain amount of user content per day to provide value. If you can't get to that point fast enough, then you'll crash and burn. I think the bigger issue is equating success with active user count. Social networks love to brag about their number of active users. It's all they care about. It doesn't matter if they're making the world a worse place, ruining lives, making people depressed, turning everyone into swiping zombies, taking information that was previously accessible and moving it inside a walled garden. That doesn't matter. If they have more active users, they're more successful. However, look at HN as a counter example. It's a decent community and I think the reason for that is not setting growth as the metric of success. HN has enough content to keep people interested. What's the purpose of more users after that point? Yes, they'll create additional revenue, but if they can't provide equally engaging content or comments, they're just going to drag the quality of the community down (a trade that most businesses gladly accept). This is the world we live in though. Everyone is focused on numbers. All people care about is followers, likes, or subscribers, and they'll happily sell their soul if they can grow those numbers. Companies don't care, they'll promote whatever garbage gets the most clicks and keeps those active users up. Advertisers don't care, they'll sponsor whoever has the highest number of views. It's a sad state of affairs.
jtode 3y ago
At this point there needs to be a very big and popular anti-capitalist push before anything good comes back. I'm all about the human rights as my first concern so any fellow SJWs reading can rest assured they don't need to interrogate me about whether I know about this or that type of oppression. BUT, can I just for a moment talk about how literally tasteless life has become? Here in Canada, we have for my whole life had a different Special K than USans. Closest I could describe it is it was like flat rice krispies with a different kinda flavor, sort of like the American one but not completely. The private equity that owns the Kelloggs brand now shut down the Canadian factory, which is the only place that made that Special K. Now we have "Original" on our shelves, in an extra bit of gaslighting. I like candy, always have. I took the notion the other day to go find some Kraft Chocolate Flavor Caramels. Lately they're called Fudgies. Most lately they're discontinued. Nothing small or niche that doesn't produce a specific profit margin is safe.
smcleod 3y ago
I feel like I’m talking about how harmful the insatiable desire for growth is on an almost daily now. I couldn’t agree with you more.
gen220 3y ago
Yeah, at some point VC became synonymous with tech. I mean here we all are, discussing this topic on a VC's forum. The two are heavily-overlapped, for sure. But in the last 25 years, it feels like the horse (tech) has been steadily placed further and further behind the cart (VC).

djbusby 3y ago

For me, I think the big mind-shift was the dot.com explosion/implosion. VC driven growth at all costs ("GaaC"), monetize later. That's when I first saw it. Prior to that what I remember was mostly building a small business. On one you grow and grow fast, needing multiple rounds, to exit. The other was build a business with one or two rounds, then have a product that generates profit. The GaaC method also means spreading the company into all kinds of things - maybe away from the core - which I think causes loss in the original value prop.

cmrdporcupine 3y ago
It's funny because having lived through that, we all thought the implosion of .com companies that worked this way, during the .com crash, was a repudiation of this strategy. But it came back within 10 years, and stronger. I also remember clearly that at the beginning of things with Facebook there was a strong sense from the press of "how the hell will this thing ever make money?" and big questions like that around the IPO. Hell, there was that going on for Google around their IPO, too. There was a brief period from about 2001 to 2007 or 2008 or so when there was perhaps more responsibility to try to start on a more even revenue-earning foundation with sounder business plans. But that all blew up in the 2010s. It's possible this was all tied into the massive cuts in interest rates, and QE etc after 2008 that made debt really cheap.

vinyl7 3y ago

It has really made me pessimistic about tech and products in general. There's the free and great stage, then the market is captured, then enshittification, then death. I don't get excited about new products or new tech because I know the cycle. Hype then bust. New thing comes out and I'm just meh about it, because it'll bust soon enough so it's not worth getting invested in it. Or new version will come out next year and break what I was used to, or it'll be an implicit subscription of having to buy new thing every year. But it's not really going to fix itself because it seems like everyone else loves the dopamine rush from the hype cycle, and they don't really seem to care about how ephemeral everything is.

lapcat 3y ago
> It has really made me pessimistic about tech and products in general. There's the free and great stage, then the market is captured, then enshittification, then death. Mark Zuckerberg an hour ago: "Our approach will be the same as all our other products: make the product work well first, then see if we can get it on a clear path to 1 billion people, and only then think about monetization at that point." https://www.threads.net/t/CuW5-eWL34x https://www.threads.net/t/CuW5-eWL34x
- wavemode 3y ago
  lol it's so explicit at this point he's the world's leading expert on the enshittification cycle
  - rchaud 3y ago
    It will always be a fascinating piece of historical trivia that Zuckerberg was represented as an iconoclastic hacker in The Social Network, when he had already turned into a turgid adtech executive by the time the movie came out.
  - mym1990 3y ago
    The ironic thing is that he lists monetization last, but simply by uttering that sentiment he tells us that they are really thinking about monetization first, aka the end goal of the product.

skizm 3y ago

> I suspect that injecting cash and attempting to achieve an unnatural growth is probably not good for both the quality of the product and the long term stability of it. Right, but that's not the point. VCs (and most founders / anyone holding equity) just want to get our before the hockey-stick graph starts turning into an S-graph. The product itself is mostly irrelevant (to everyone except the users that is).

MSFT_Edging 3y ago
> but that's not the point. VCs (and most founders / anyone holding equity) just want to get our before the hockey-stick graph starts turning into an S-graph. Most efficient system in the world, ladies and gentlemen

sneak 3y ago

Public social media is one to many publishing. Mass publishing is more useful and valuable the more people you can publish to at once. It has nothing to do with VC. "Don't pick fights with people who buy ink by the barrel" long predates vulture capitalists.

JohnFen 3y ago
> Mass publishing is more useful and valuable the more people you can publish to at once. Absolutely, but that was happening long before the likes of Facebook, Twitter, etc., came around to monetize it and convince people that they are the only ways to do it. They're cultural parasites.

_bkyr 3y ago

I believe it's really the outcome of capitalism and greed taking something that was organic (forums and chat) and monetizing it to death. Facebook monetized your family and friends, Instagram monetized your vanity / creativity, etc. You can see this incorporation of the internet with the classic Craiglist image: - https://scalecuts.com/wp-content/uploads/2019/04/Craigslist-Marketplaces.png https://scalecuts.com/wp-content/uploads/2019/04/Craigslist-... - https://mediacloud.theweek.com/image/private/s--X-WVjvBW--/f_auto,t_content-image-full-desktop@1/v1608244092/craigslist.png https://mediacloud.theweek.com/image/private/s--X-WVjvBW--/f...

gen220 3y ago
I would agree with greed but push back on capitalism. There are many ways to be a capitalist. Greed is a common choice, but there are more humanist approaches, too. From your example, Craigslist is itself is a capitalist institution, making >$100mm/year. Patagonia, Wikipedia, King Arthur Baking Company, Darn Tough Socks, Lodge cookware, are all capitalist too. I think it's important for entrepreneurial-minded folks to have positive role models – it's possible to develop wealth for yourself, your customers, your employees, and your environment, and to do so with respect and dignity. In fact, a well-operated business is probably the most effective vehicle for having an outsized impact in your community, so defined.

ilrwbwrkhv 3y ago

While this is true and I think most VCs are idiots, there is a natural phenomenon of the internet which allows for exponential growth and which means that startup = growth is a very real thing. What VCs and a lot of startups try and do is fake the actual utility of a product through forced marketing and Glamour.

mattbuilds 3y ago
Yea I actually think it's similar to something that happens with my 2 year-old. He thinks putting shoes on means we go outside. So when he wants to go outside, rather than saying "outside", he goes and gets his shoes. The internet' scale allows great products to grow exponentially. A bunch of great software, sites, and tools took off and grew at a rapid rate. But we took the wrong lesson from this and thought "rapid growth=great product". So VCs have put growth above everything else, and are hoping they can figure out a product after, like a 2 year-old thinking that putting on his shoes will mean he gets to go outside.

hinkley 3y ago

> There is a fixation with growing and doing it rapidly that I believe is harmful. I don't know when this switch flipped. Gradually? I happened around 1995 and it’s only ever slowed down for recessions. It’s not a trend of companies it’s a trend of funding sources and strategies. If you take fifty million in funding, those guys want it back. And they want it back 10x. So when your favorite little company takes a funding round that is five times more money than they’ve ever seen total, let alone at once, your favorite little company is about to change into something ugly.

xeromal 3y ago

This is a huge tangent, but I've started harboring similar feelings for video games. Go read comments for the latest game and 90% of the comments will be about item drops, skins, loot drops, whatever. It's absolutely mind boggling because all those things IMO suck the fun out of the game which it to kill something, kill someone, or explore some world.

cableshaft 3y ago
Just stop playing most AAA or mobile games and that should solve most of that for you. The exceptions being the God of War series, the Mario and Zelda series. I still get excited for those. And probably the next Elder Scrolls or Witcher game. But other than that, lately I've been far more excited about the Persona series, Nier Automata, Spike Chunsoft games (especially Danganronpa), The Witness (a bit older now), The Outer Wilds, Subnautica, Slay the Spire, Inscryption, and Vampire Survivors. Tears of the Kingdom is probably the best pure exploration game ever made, with Outer Wilds being better in some ways, as it's simulating an entier solar system in real time and has some really clever ideas in it, but it's a smaller game overall. I think I pretty much fully explored Outer Wilds (except the expansion) in 20 hours, I've aleady put in 80 hours into TOTK and I've seen maybe 40% of the content so far.
EA-3167 3y ago
The key is to just pass on those sorts of games, because there are still plenty of others that don't play with the customer that way.
- xeromal 3y ago
  I'm actually arguing against the gamer in this case. For the most part, I enjoy those games because I don't work myself up over loot drops, skins, etc.
emadabdulrahim 3y ago
The mobile gaming era pioneered the approach where game design is fundamentally driven by the game's monetization mechanics.

tempodox 3y ago

> I suspect that injecting cash and attempting to achieve an unnatural growth is probably not good for both the quality of the product and the long term stability of it. The people getting rich with these methods don't care about quality or stability.

nottorp 3y ago

Most of HN would always assume you have to compete and capture the market, no matter what you're talking about.

mattbuilds 3y ago
If you are taking hundred of millions in funding, sure you need to capture the market of "all the people". If you build something that's just for a certain group of people, you can compete by just having a better product that specifically addresses those users needs. Look at HN, I know, run by a VC and it's not without some issues, but it is still better than most forums and social media to me specifically because of what it doesn't try to do. It has a specific goal and doesn't feel the need to try and extend beyond it. My ideal is that in the future we will more communities like this, where it's built to address a group of users needs and not try and expand beyond it. Where the content and information is shaped in a form to meet the specific needs of the group using it and not generalized into the lowest common denominator so ad sales can go up. It feels unlikely at this point, but I still have hope.

davidguetta 3y ago

> Things can just be what they are, grow naturally and then die naturally. I suspect that injecting cash and attempting to achieve an unnatural growth is probably not good for both the quality of the product and the long term stability of it. Maybe this actually IS, the natural way to grow and die for a global social network

marginalia_nu 3y ago

I think it's a problem outside of the VC-adjacent space too. There's a sense that if you can't solve a huge societal problem (ideally several), it's not worth doing anything. It's really disempowering mindset because most of those problems are really hard to solve. It's like all the focus is on what effect the thing you're building will have on the world, rather than just building something because you think it would be kinda neat if it existed. The latter type of projects are the only sorts of projects I've had any success with. It's really liberating to not have to play some five dimensional chess game guessing what will make other people behave in certain ways and just using your own judgement to build what you like.

badtension 3y ago
Oh man well said, I had this uneasy feeling while reading your comment. I think the world is fucked, especially in how it's planting incentives in our brains. For girls it's clothes, make-up, being fit. For guys it's cars, games, sex. And of course there's general consumerism that doesn't gender-discriminate anyone. For tech people there's something else I hate with passion: creating images of great, world changing people. We aspire to be Zucks, Musks, Gateses, Holmes (yes, theranos). It's always bullshit to sell something or gain political power but the damage is done anyway. It's hard to live a simple life and enjoy simple things when everyone around expected you to look up to them and change the world. Many people believed their narration and became sociopaths that maximize gains on every opportunity. Even I was very drawn to "growth hacking" before. Now I see how crazy it all is.
gen220 3y ago
> It's really liberating to not have to play some five dimensional chess game guessing what will make other people behave in certain ways and just using your own judgement to build what you like. I think people underrate this idea, way too much. Humans are a pretty diverse set of people. But we're similar enough that in a population with ~10^13 people, there's probably 10^4 people who are pretty much clones of you, in terms of your preference, taste, etc. With the internet, it's never been cheaper to find them. Preconditioned on it being you or me, 10^3 of those people are probably browsing this website, for example. I hope the fluctuations of fashion lean more towards assigning social value to smaller, more sustainable builders. The migration in that direction deserves to be bigger. I observe it happening personally, but tech media is lagging significantly behind, mainly because these people don't spend money on advertising or PR.

konschubert 3y ago

Many companies fail because they take on investment and then have to grow into their valuation. The fast growth creates enormous inefficiencies inside the company, because management and tech cannot keep up. This often mans that the company eventually has to shut down.

renegade-otter 3y ago
On more than one occasion I've worked in places where we were asked to be at our tidied up desks because VCs were about to be paraded through the office. Every time there were more of us. Basically, "look at how we are burning through your money by hiring all these people. Growth!" Now, the actual growth, daily active users and all, that is an area of rampant fraud, but VCs seem to be OK with it until the company runs out of runway. THEN it's a total scandal, even though all they need to do is pop the hood for 5 minutes to see how the numbers are arrived at.

Guest9081239812 3y ago

I understand growing rapidly, especially for a social network, where you need to quickly reach a certain amount of user content per day to provide value. If you can't get to that point fast enough, then you'll crash and burn. I think the bigger issue is equating success with active user count. Social networks love to brag about their number of active users. It's all they care about. It doesn't matter if they're making the world a worse place, ruining lives, making people depressed, turning everyone into swiping zombies, taking information that was previously accessible and moving it inside a walled garden. That doesn't matter. If they have more active users, they're more successful. However, look at HN as a counter example. It's a decent community and I think the reason for that is not setting growth as the metric of success. HN has enough content to keep people interested. What's the purpose of more users after that point? Yes, they'll create additional revenue, but if they can't provide equally engaging content or comments, they're just going to drag the quality of the community down (a trade that most businesses gladly accept). This is the world we live in though. Everyone is focused on numbers. All people care about is followers, likes, or subscribers, and they'll happily sell their soul if they can grow those numbers. Companies don't care, they'll promote whatever garbage gets the most clicks and keeps those active users up. Advertisers don't care, they'll sponsor whoever has the highest number of views. It's a sad state of affairs.

jtode 3y ago

At this point there needs to be a very big and popular anti-capitalist push before anything good comes back. I'm all about the human rights as my first concern so any fellow SJWs reading can rest assured they don't need to interrogate me about whether I know about this or that type of oppression. BUT, can I just for a moment talk about how literally tasteless life has become? Here in Canada, we have for my whole life had a different Special K than USans. Closest I could describe it is it was like flat rice krispies with a different kinda flavor, sort of like the American one but not completely. The private equity that owns the Kelloggs brand now shut down the Canadian factory, which is the only place that made that Special K. Now we have "Original" on our shelves, in an extra bit of gaslighting. I like candy, always have. I took the notion the other day to go find some Kraft Chocolate Flavor Caramels. Lately they're called Fudgies. Most lately they're discontinued. Nothing small or niche that doesn't produce a specific profit margin is safe.

smcleod 3y ago

I feel like I’m talking about how harmful the insatiable desire for growth is on an almost daily now. I couldn’t agree with you more.

gen220 3y ago

Yeah, at some point VC became synonymous with tech. I mean here we all are, discussing this topic on a VC's forum. The two are heavily-overlapped, for sure. But in the last 25 years, it feels like the horse (tech) has been steadily placed further and further behind the cart (VC).