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@hj@shigusegubu.club @hj@shigusegubu.clublord please strike him down with lightning, just explode him
:gondola_head: 
:ignutius: 
:stargate: > That has been the strategy of all proprietary SaaSS since forever.
Yeah, have worked at several VC-funded startups, I know. The question is why are they still spending this much on user acquisition.
@lanodan@queer.hacktivis.meIn the specific case of Microsoft spending nuclear-plant levels of electricity and doing massive pushes to send people out to train other companies to use Copilot more, pushing "FREE COPILOT!" on VSCode users and Github users, and having quotas for a percentage of lines of code generated rather than written, right? They're spending way more on this than seems reasonable in order to corner a market that will not ever be profitable.
There's something they believe about this market that is not obvious to me; I am curious what it is.
What they believe is that "AI iS tHe FuTuRe!!" and that chatbots will replace all the plebs and somehow they will get richer off this, rather than get hanged by a starving, unemployed mob. There is no rationality in it; it's vapid suits believing ridiculous things while having cartoonish green dollar signs in their eyes. They can fund this nonsense because they have hundreds of billions of VC dollars to throw at a wall with absolutely no accountability. The reason they have that money, in a very small nutshell, is that interest rates are way too low and it's illegal for poor people to invest anywhere except the stock market.
LLM's have a promising future to replace low-level call center workers, professional translators (a huge industry, I know), and minimum wage corporate photoshop monkeys. These are legitimate uses that will benefit the world, but it's not a gold rush even though all the suits are acting like it. With any luck, the Mark Cubans of this cycle will hodl all the way into bankruptcy.
I think we're seeing some degenerate, collapsing-empire shit here. The sclerotic, hyper-regulated, hyper-inflating, socialist-all-but-in-name economy has been dead for a while and the only big gains to be made are on asset bubbles and scams, so everybody is looking for "the next big scam thing," be that AI, electric cars, cryptocoins, regulation-dodging taxi services, or orbital burrito delivery systems. Nobody is looking to run an honest, modest, and consistently profitable business.
@gentoobro
I just want to buy a house. I'm pricing my service accordingly.
No investors. No Uber model where I lose money on every chat because some VC is picking up the tab. None of that shit. I won't do it. I hope that can itself be a selling point. "There is no end game. I want to be making some sort of profit the entire time."
No need for exponential growth on the exponential growth to please investors.
The problem here is, the people most likely to want that sort of firm at the same people likely to turn up their nose at *anything* I sell, especially if it's an AI product.
@p @lanodan @hj @Hoss @mangeurdenuage
There is no end game. I want to be making some sort of profit the entire time.
Aka normal, profitable, sustainable business, not run by compulsive gamblers.
If there's no market for your product, find a new product. But there's very likely a market, especially among other small but serious business owners. It's really hard for them to find good, reliable partners and suppliers that aren't trying to run a scam and won't just evaporate when interest rates rise 0.5%.
@gentoobro
In 2013 I learned that the only way I could fathom starting a business had a special name because nobody ever does it anymore.
It's called a "lean startup" and some guy even wrote a book about it.
@p @lanodan @hj @Hoss @mangeurdenuage
> It's called a "lean startup" and some guy even wrote a book about it.
They just call it a business or a service; it's a reasonable thing to do.
The VC-fund dicks call this stuff a "lifestyle business": plebs that are just running a business to support their lifestyle rather than disrupting moonshots.
The typical VC fund aims for at least a 4x gross return on capital before fees.
If a VC fund raises $50 million, it needs to return $200 million (4x) to be considered successful.
After dilution, VCs often end up with about 10% ownership in their portfolio companies.
To get $200 million back from a 10% stake, the fund’s companies collectively need to exit for about $2 billion in value ($2B x 10% = $200M)
This is why normal businesses don't interest a VC. They want something that scales 40x
> This is why normal businesses don't interest a VC. They want something that scales 40x
This is accurate, yes. If you have enough money to buy mining rights in one location, it may or may not pay off. If you can afford to buy mining rights in thirty locations and one of them pays off, you've made money. So VCs don't want a stable business: they're buying a stake each in 100 different moonshots. This is why it deforms the entire business model: they're pushing all of them to become unicorns, which means hockeysticks everywhere and a completely distorted risk/reward proposition. If you are going for hockeysticks, you make very different decisions than a normal business would. One of the startups is a unicorn and that's an exit event; the other 99 companies get shat out into the meat grinder within five years; 90 get the entire hose, 9 get a modest acquisition pushed on them.
40x companies are so rare that it reduces to gambling. VCs are gamblers, and they generally gamble with money that was stolen through inflation.
> Patrick Boyle's content really opened my eyes to the sheer volume of hairbrained bullshit that VCs burn millions and billions of dollars on every single year.
As mentioned in a different thread, this is why I went freelance: they don't need me to *believe*.
> Most VC figureheads only look like the genius gurus of early-stage investing because every heavily promoted win sits upon the buried corpses of a dozen failures.
This is because everything you know about the stock market and big investors is also true of venture capital, including "the really big players are playing with other people's money".