5 ms·

How is that a nail in the coffin?

candiddevmike 3y ago
How do you have a 100M business selling cheap, niche microcontrollers to hobbyists? They're starting to pursue a subscription model (Arduino Cloud), I'd expect them to shutter products that won't work with the subscription model and require everything else to use it. It's your standard enshitification play.
- sgt 3y ago
  By having 10M+ hobbyists that you support and inspire. That's how... easier said than done, but if they play their cards right, it is possible.
  - coldpie 3y ago
    > but if they play their cards right, it is possible. Not with $54M in debt to service. This is a death warrant. I'm sure the execs will make out nicely, though.
    - tedivm 3y ago
      There isn't any debt to service. Taking funding isn't the same as taking debt (in some ways its worse, in some better), and there's no direct interest or payment they have to make every month like if it was debt. The problem is that they give up ownership (and probably ownership) to people who may have different goals and values. This can lead to enshittification, especially for a company that doesn't have a good path to extreme growth and profits. You also can't discharge ownership in bankruptcy like you can with debt.
      - yard2010 3y ago
        Isn't "raising funds" just a euphemism for taking a loan you don't have to return in cash? Like a loan which is not regulated as a loan
        bombcar 3y ago
        It's not a loan because it doesn't have to be paid back. But it operates somewhat worse than a loan because the buyer now has some say in how the company is run, and they will want to see a return on their investment eventually. A loan may be better because as long as the company can service it, the lenders have no say in how the business is run, and they get no additional profit from increased income/profit of the business.
        marcosdumay 3y ago
        Except that if you sell or liquidate the company, you have to pay it all back before you can get any of the money. So... It's completely equivalent to a low preference loan.
        gbear605 3y ago
        Technically a VC with less than 50% control can’t do anything to you, so as long as you keep 51% and never sell or liquidate then it’s free money. In practice, they wind up pressuring you to do those things and then they get their money back.
        yard2010 3y ago
        That's my point, when taking a loan you know upfront the cost, but when raising money you can't know what it really takes
        Invictus0 3y ago
        Aren't apples just a euphemism for oranges?
        yard2010 3y ago
        Are they now
      - memefrog 3y ago
        [dead]
      - Ekaros 3y ago
        It is not debt, but on other hand anyone investing this pay probably have expectation of return that is higher than a loan would be. And that money must come from somewhere at somepoint...
  - mholm 3y ago
    VCs, historically, don't understand this. Arduino did, but they've likely ceded some control by doing this fundraising. Maybe these VCs are different. I'm not counting on it.
  - marcosdumay 3y ago
    That won't do. Your number is way too low. You need either at least an order of magnitude more (still iffy, people don't buy boards all the time), or to sell into some larger market. Are there 100M electronics hobbyists to sell to over the world? Maybe if you make it into schools...
  - crote 3y ago
    "Supporting" and "inspiring" hobbyists isn't going to pay the bills, though. Arduino opened up an ecosystem when they started back in 2005, but the world looks a lot different in 2023. First-party Arduinos are nothing special these days, and their competitors make way better products for far less money. Even the Arduino IDE has been leapfrogged by MicroPython / CircuitPython. Hobbyists these days just aren't all that interested in Arduino anymore, and there is pretty much nothing paid which they can introduce which will change that.

How do you have a 100M business selling cheap, niche microcontrollers to hobbyists? They're starting to pursue a subscription model (Arduino Cloud), I'd expect them to shutter products that won't work with the subscription model and require everything else to use it. It's your standard enshitification play.

sgt 3y ago
By having 10M+ hobbyists that you support and inspire. That's how... easier said than done, but if they play their cards right, it is possible.
- coldpie 3y ago
  > but if they play their cards right, it is possible. Not with $54M in debt to service. This is a death warrant. I'm sure the execs will make out nicely, though.
  - tedivm 3y ago
    There isn't any debt to service. Taking funding isn't the same as taking debt (in some ways its worse, in some better), and there's no direct interest or payment they have to make every month like if it was debt. The problem is that they give up ownership (and probably ownership) to people who may have different goals and values. This can lead to enshittification, especially for a company that doesn't have a good path to extreme growth and profits. You also can't discharge ownership in bankruptcy like you can with debt.
    - yard2010 3y ago
      Isn't "raising funds" just a euphemism for taking a loan you don't have to return in cash? Like a loan which is not regulated as a loan
      - bombcar 3y ago
        It's not a loan because it doesn't have to be paid back. But it operates somewhat worse than a loan because the buyer now has some say in how the company is run, and they will want to see a return on their investment eventually. A loan may be better because as long as the company can service it, the lenders have no say in how the business is run, and they get no additional profit from increased income/profit of the business.
        marcosdumay 3y ago
        Except that if you sell or liquidate the company, you have to pay it all back before you can get any of the money. So... It's completely equivalent to a low preference loan.
        gbear605 3y ago
        Technically a VC with less than 50% control can’t do anything to you, so as long as you keep 51% and never sell or liquidate then it’s free money. In practice, they wind up pressuring you to do those things and then they get their money back.
        yard2010 3y ago
        That's my point, when taking a loan you know upfront the cost, but when raising money you can't know what it really takes
      - Invictus0 3y ago
        Aren't apples just a euphemism for oranges?
        yard2010 3y ago
        Are they now
    - memefrog 3y ago
      [dead]
    - Ekaros 3y ago
      It is not debt, but on other hand anyone investing this pay probably have expectation of return that is higher than a loan would be. And that money must come from somewhere at somepoint...
- mholm 3y ago
  VCs, historically, don't understand this. Arduino did, but they've likely ceded some control by doing this fundraising. Maybe these VCs are different. I'm not counting on it.
- marcosdumay 3y ago
  That won't do. Your number is way too low. You need either at least an order of magnitude more (still iffy, people don't buy boards all the time), or to sell into some larger market. Are there 100M electronics hobbyists to sell to over the world? Maybe if you make it into schools...
- crote 3y ago
  "Supporting" and "inspiring" hobbyists isn't going to pay the bills, though. Arduino opened up an ecosystem when they started back in 2005, but the world looks a lot different in 2023. First-party Arduinos are nothing special these days, and their competitors make way better products for far less money. Even the Arduino IDE has been leapfrogged by MicroPython / CircuitPython. Hobbyists these days just aren't all that interested in Arduino anymore, and there is pretty much nothing paid which they can introduce which will change that.