3 ms·

More and more these social media platforms feel like scheme's. Round after round of funding without ever reaching profitablity

QAPereo 9y ago
Is that really only occurring to poeple here, now?!
- jastanton 9y ago
  General reminder to be courteous, especially when people learn something new: https://xkcd.com/1053/ https://xkcd.com/1053/
  - model_m_warrior 9y ago
    Tech is full of school marms now. Thats how we know its mainstream.
    - dang 9y ago
      Would you please stop posting unsubstantive comments to HN? We ban accounts that do that as much as you've been. In case it helps: I don't give a fig about being a schoolmarm, nor does anyone else who works on HN. What we care about is having a web forum that isn't quite at the bottom of the barrel. The downward pressure thither is so overwhelming that unless we do specific things to counteract it, and maintain them constantly, that's where we all end up. That's bad, not because Miss Manners doesn't approve, but because it's boring.
  - QAPereo 9y ago
    I’ve adapted my tone to the forum in question, but it’s true that I need to work on making my manner more robotic and increasing overall passive aggression, thanks!
    - dang 9y ago
      A better place to start would be dropping the unsubstantive comments. HN's rules aren't the way they are to try to neuter your brilliant genius. We're just trying to avoid sucking quite so badly. Since you use this site heavily you should contribute to making it better, not worse.
oaijdsfoaijsf 9y ago
There's always the option to simply not invest. For those platforms still in a pre-IPO state, you probably can't invest, even if you want to. For Twitter, it's easy enough to not buy the stock, and, indeed, if you bought in Jan 2014, you probably wish you hadn't. But if you bought yesterday, you're probably happy enough right now.
- notyourwork 9y ago
  > But if you bought yesterday, you're probably happy enough right now. Get out while you can enjoy a profit.
- kecoco0207 9y ago
  There are currently possible ways to access and invest in those pre-IPO companies. For example, EquityZen is a platform that lets people to invest in private markets: https://equityzen.com/?utm_source=hackernews&utm_medium=comments&utm_campaign=investor https://equityzen.com/?utm_source=hackernews&utm_medium=comm...
- bofia 9y ago
  There are ways for investing in companies Pre-IPO such as EquityZen (https://equityzen.com https://equityzen.com). Often, shareholders want to get liquidity before IPO and sell their shares via the secondary market. Disclosure: I am an engineer at EquityZen
dexterdog 9y ago
And what's crazier is that this is one of the unicorns and they're still bleeding cash esp. from a company lifetime perspective.
nkozyra 9y ago
Don't VCs constantly fund things (social media or otherwise) that never reach profitability? Isn't that the whole gamble of "venture" funding in the first place? The monetization aspect is supposedly solved. If I suspect you can garner audience, I posit that said audience can be translated into ad dollars at some point in the future. Only the first part is speculative. And speculation is what venture funding is all about.
- JumpCrisscross 9y ago
  > Don't VCs constantly fund things (social media or otherwise) that never reach profitability? The expectation isn’t perpetual. Evert company must become profitable, be acquired by someone who believes it will make them (more) profitable (or attractive to another party with that belief), or go bust.
  - nkozyra 9y ago
    Of course. But look at the context of my reply: > More and more these social media platforms feel like scheme's. Round after round of funding without ever reaching profitablity Nowhere did I say we're looking at perpetual return on investment. Like any investment, you're looking to go in at a certain point and get out at a certain point. This is no more a "scheme" than buying a house and hoping it increases in value or buying a lottery ticket. The underlying value is audience. Some companies get that, others don't.
Pica_soO 9y ago
The next big scheme is allready in the making - virtual customers: You order a shoebox appartment, create a home-maker NN that can fake basic human occupancy, register it online as a new citizen and put it on basic income, and set it up to order stuff from company A. Now those NN trade among one another, sending the stuff in a circle until its scrap or they are broke and its impounded. Finally, the limiting part for eternal growth can be removed.
- philippnagel 9y ago
  Could you elaborate? Who's doing something like that?
muzani 9y ago
What most investors fund is something that creates value, and then convert that value to cash later. Creating value is the hard part. It's not always about a company's profitability either. Startups focus on exponentially growing their assets rather than cash flow then selling it all to someone else. Like Facebook can make more wealth from WhatsApp than they could do by themselves. Of course, profitability is often close to the actual value something creates. Twitter is a really odd case in that it's a big part of many people's lives, but they won't pay for it.
- thanatropism 9y ago
  Nearly every internet-related thing is "a big part of many people's lives but they won't pay for it".

QAPereo 9y ago

Is that really only occurring to poeple here, now?!

jastanton 9y ago
General reminder to be courteous, especially when people learn something new: https://xkcd.com/1053/ https://xkcd.com/1053/
- model_m_warrior 9y ago
  Tech is full of school marms now. Thats how we know its mainstream.
  - dang 9y ago
    Would you please stop posting unsubstantive comments to HN? We ban accounts that do that as much as you've been. In case it helps: I don't give a fig about being a schoolmarm, nor does anyone else who works on HN. What we care about is having a web forum that isn't quite at the bottom of the barrel. The downward pressure thither is so overwhelming that unless we do specific things to counteract it, and maintain them constantly, that's where we all end up. That's bad, not because Miss Manners doesn't approve, but because it's boring.
- QAPereo 9y ago
  I’ve adapted my tone to the forum in question, but it’s true that I need to work on making my manner more robotic and increasing overall passive aggression, thanks!
  - dang 9y ago
    A better place to start would be dropping the unsubstantive comments. HN's rules aren't the way they are to try to neuter your brilliant genius. We're just trying to avoid sucking quite so badly. Since you use this site heavily you should contribute to making it better, not worse.

oaijdsfoaijsf 9y ago

There's always the option to simply not invest. For those platforms still in a pre-IPO state, you probably can't invest, even if you want to. For Twitter, it's easy enough to not buy the stock, and, indeed, if you bought in Jan 2014, you probably wish you hadn't. But if you bought yesterday, you're probably happy enough right now.

notyourwork 9y ago
> But if you bought yesterday, you're probably happy enough right now. Get out while you can enjoy a profit.
kecoco0207 9y ago
There are currently possible ways to access and invest in those pre-IPO companies. For example, EquityZen is a platform that lets people to invest in private markets: https://equityzen.com/?utm_source=hackernews&utm_medium=comments&utm_campaign=investor https://equityzen.com/?utm_source=hackernews&utm_medium=comm...
bofia 9y ago
There are ways for investing in companies Pre-IPO such as EquityZen (https://equityzen.com https://equityzen.com). Often, shareholders want to get liquidity before IPO and sell their shares via the secondary market. Disclosure: I am an engineer at EquityZen

dexterdog 9y ago

And what's crazier is that this is one of the unicorns and they're still bleeding cash esp. from a company lifetime perspective.

nkozyra 9y ago

Don't VCs constantly fund things (social media or otherwise) that never reach profitability? Isn't that the whole gamble of "venture" funding in the first place? The monetization aspect is supposedly solved. If I suspect you can garner audience, I posit that said audience can be translated into ad dollars at some point in the future. Only the first part is speculative. And speculation is what venture funding is all about.

JumpCrisscross 9y ago
> Don't VCs constantly fund things (social media or otherwise) that never reach profitability? The expectation isn’t perpetual. Evert company must become profitable, be acquired by someone who believes it will make them (more) profitable (or attractive to another party with that belief), or go bust.
- nkozyra 9y ago
  Of course. But look at the context of my reply: > More and more these social media platforms feel like scheme's. Round after round of funding without ever reaching profitablity Nowhere did I say we're looking at perpetual return on investment. Like any investment, you're looking to go in at a certain point and get out at a certain point. This is no more a "scheme" than buying a house and hoping it increases in value or buying a lottery ticket. The underlying value is audience. Some companies get that, others don't.

Pica_soO 9y ago

The next big scheme is allready in the making - virtual customers: You order a shoebox appartment, create a home-maker NN that can fake basic human occupancy, register it online as a new citizen and put it on basic income, and set it up to order stuff from company A. Now those NN trade among one another, sending the stuff in a circle until its scrap or they are broke and its impounded. Finally, the limiting part for eternal growth can be removed.

philippnagel 9y ago
Could you elaborate? Who's doing something like that?

muzani 9y ago

What most investors fund is something that creates value, and then convert that value to cash later. Creating value is the hard part. It's not always about a company's profitability either. Startups focus on exponentially growing their assets rather than cash flow then selling it all to someone else. Like Facebook can make more wealth from WhatsApp than they could do by themselves. Of course, profitability is often close to the actual value something creates. Twitter is a really odd case in that it's a big part of many people's lives, but they won't pay for it.

thanatropism 9y ago
Nearly every internet-related thing is "a big part of many people's lives but they won't pay for it".