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Some bad Yelp reviews and wasting the time of a minimum wage employee? Not exactly the apocalypse or "a cluster bomb" or whatever you called it. Yes businesses

Some bad Yelp reviews and wasting the time of a minimum wage employee? Not exactly the apocalypse or "a cluster bomb" or whatever you called it. Yes businesses have externalities. No, this cute story does not make me question silicon valley. Spending a lot on customer acquisition costs is the norm and on net works out very well for SV. Again, Airbnb is not a bad business model, so we're now having two different discussions. This discussion is supposed to be about why people don't like cash flow-negative businesses. Airbnb is a great business model (cash flow positive with solid growth). I see it has some externalities that you don't like, but literally every business has externalities. It's fine that you don't like them but that's not an indictment of capitalism or SV. It's just a business you don't like. Are you equally upset with most of the Fortune 500 that probably have worse externalities than driving up prices in some trendy neighborhoods? If so, that's fine, but nothing to do with our discussion. Uber is a fine business though. The issues with uber aren't it's cash flow problems. They could very quickly become cash flow positive if they wanted to (they would just have to change their growth trajectory). If you're worried about carbon emissions, that's fine, we all should be. But you should be furious at basically all businesses. This is nothing special to do with Silicon Valley. You should focus 100x this rage on the Permian Basin. Are you?

Apocryphon 6y ago
This wasn't the first story to describe animosity between restaurants and food delivery apps. Not too long before that article there was also this: https://news.ycombinator.com/item?id=23194727 https://news.ycombinator.com/item?id=23194727 https://news.ycombinator.com/item?id=10551312 https://news.ycombinator.com/item?id=10551312 Perhaps one could also say their attempts to cheat their staff out of tips is also an externality in the sense that it further devalues the labor power of gig workers, but I suspect I'm just overusing that word by now. > Not exactly the apocalypse or "a cluster bomb" or whatever you called it. It's less of an apocalypse, than collateral damage. Perhaps during the first dot com bubble the majority of the losers- Enron excepted- kept the damage within the tech sector. Nowadays with software having eaten the world, the capacity to cause problems for the rest of the world is much greater. > I see it has some externalities that you don't like, but literally every business has externalities. It's fine that you don't like them but that's not an indictment of capitalism or SV. It's just a business you don't like. Are you equally upset with most of the Fortune 500 that probably have worse externalities than driving up prices in some trendy neighborhoods? So this is the crux of if tall, which could provide fertile ground for a more extended discussion. There's something to be said that many of these grow-at-all-costs VC-cash infused unicorns have modus operandi that includes cutting corners and aggressive business tactics. Stories about early-stage Uber telling its drivers to drip off mustaches from competing Lyft vehicles come to mind, presaging the much more excessive and extensive abuses that later resulted. The question is, would this sort of reckless behavior have manifested if the overall pace that these companies were operating under were not as aggressive and fast? Does the the medium of the money eventually dictate the behavior of the company? It would seem like in some of these examples, the promise of big dumb money, coupled with incentives to pursue cash flow-negative business models, coupled with the problems resulting from having to make good on the big dumb money investments while digging themselves in deeper with said half-baked business models, leads to them engaging in even more risky and externality-creating behavior. And generally promotes a toxic business culture that excuses bad behavior. If they had less money to play around with and lower expectations and thus less incentive to desperately flail around trying to justify their crazy valuations, could this behavior be preempted, or at least lessened? > Airbnb is a great business model (cash flow positive with solid growth). And yet, their losses were mounting pre-pandemic: https://www.cnbc.com/2019/10/17/airbnbs-quarterly-loss-reportedly-doubled-in-q1.html https://www.cnbc.com/2019/10/17/airbnbs-quarterly-loss-repor... > You should focus 100x this rage on the Permian Basin. Are you? You don't need to be livid with rage to mention someone is contributing to a larger problem, however proportionally small. You don't even need to mention climate change as a reason to blame ridesharing for driving up traffic; the increase in traffic is inconvenience enough, let alone its influence on public policy wrt urban planning, decrease in investment for transit, etc. > They could very quickly become cash flow positive if they wanted to (they would just have to change their growth trajectory). Great idea! Will they? Can they?
- bobbydroptables 6y ago
  >the capacity to cause problems for the rest of the world is much greater. And none of these problems should cause us to lose sleep. A few bad yelp reviews. Uh oh. Carbon emissions should cause us to lose sleep but nuking Lyft and Uber back to the stone age would probably have net zero effect on this. >Stories about early-stage Uber telling its drivers to drip off mustaches from competing Lyft vehicles come to mind, presaging the much more excessive and extensive abuses that later resulted. If you think this is bad you should read about how fire departments used to operate. Fierce competition is one thing that even critics of capitalism should support. Maybe not fire departments brawling, but consumers generally win when competition is fierce. The mustache things sounds hilarious but can't say I've heard of it. Can you link me? Did Uber HQ order its people to vandalize Lyfts? >It would seem like in some of these examples, the promise of big dumb money, coupled with incentives to pursue cash flow-negative business models, coupled with the problems resulting from having to make good on the big dumb money investments while digging themselves in deeper with said half-baked business models, leads to them engaging in even more risky and externality-creating behavior. And generally promotes a toxic business culture that excuses bad behavior. I don't see how this is any worse than the externalities and behavior of cash flow positive businesses. Are you arguing that Bechtel and Blackwater and Facebook and Amazon and Exxon have fewer positive externalities or better behavior? Capitalism has problems. But Silicon Valley and dumb money aren't it. Destroying the planet is it, but you'll see that with 99.99% of companies. Absolutely nothing to do with SV or dumb money. "Smart money" often invests in planet destroying things because they happen to be really profitable a lot of the time. >If they had less money to play around with and lower expectations and thus less incentive to desperately flail around trying to justify their crazy valuations, could this behavior be preempted, or at least lessened? I mean, none of the behavior you're describing is really offensive to me. I find the pizza arbitrage story funny and cute and probably a sign of running a sloppy business. I don't really care other than that because I don't own shares of Doordash. >And yet, their losses were mounting pre-pandemic: So your distaste for Airbnb arose precisely when their losses mounted? Or is it fair to say that your dislike of Airbnb has nothing to do with their income statement? Trying to make sure we're not getting two conversations mixed up. I understand you don't like Airbnb but that's not a very interesting conversation. I'm more interested in people taking personal offense to cash-flow negative businesses. >You don't need to be livid with rage to mention someone is contributing to a larger problem, however proportionally small. You don't even need to mention climate change as a reason to blame ridesharing for driving up traffic; the increase in traffic is inconvenience enough, let alone its influence on public policy wrt urban planning, decrease in investment for transit, etc. You don't need to do anything sure. It's just kind of silly to scream and shout about some dumb investors when a bunch of people are silently killing the planet and I rarely see these sensational news stories or comments about them. I see 10x attention about Airbnb causing rent prices in trendy neighborhoods. >Great idea! It's a horrible idea actually! This kind of thinking is why people hate investors that are only interested in quarterly returns. >Will they? If I were an owner, I would absolutely hope not! I guess I'm one of these strange investors that cares about long term value rather than short term returns. If they can take over taxis around the world for the next 30 years, I don't really care if they had a few unprofitable quarters. >Can they? Sure. If they just started charging the actual price for a ride, they would be making a lot of money. But that's not the business that investors wanted to buy.

Apocryphon 6y ago

This wasn't the first story to describe animosity between restaurants and food delivery apps. Not too long before that article there was also this: https://news.ycombinator.com/item?id=23194727 https://news.ycombinator.com/item?id=23194727 https://news.ycombinator.com/item?id=10551312 https://news.ycombinator.com/item?id=10551312 Perhaps one could also say their attempts to cheat their staff out of tips is also an externality in the sense that it further devalues the labor power of gig workers, but I suspect I'm just overusing that word by now. > Not exactly the apocalypse or "a cluster bomb" or whatever you called it. It's less of an apocalypse, than collateral damage. Perhaps during the first dot com bubble the majority of the losers- Enron excepted- kept the damage within the tech sector. Nowadays with software having eaten the world, the capacity to cause problems for the rest of the world is much greater. > I see it has some externalities that you don't like, but literally every business has externalities. It's fine that you don't like them but that's not an indictment of capitalism or SV. It's just a business you don't like. Are you equally upset with most of the Fortune 500 that probably have worse externalities than driving up prices in some trendy neighborhoods? So this is the crux of if tall, which could provide fertile ground for a more extended discussion. There's something to be said that many of these grow-at-all-costs VC-cash infused unicorns have modus operandi that includes cutting corners and aggressive business tactics. Stories about early-stage Uber telling its drivers to drip off mustaches from competing Lyft vehicles come to mind, presaging the much more excessive and extensive abuses that later resulted. The question is, would this sort of reckless behavior have manifested if the overall pace that these companies were operating under were not as aggressive and fast? Does the the medium of the money eventually dictate the behavior of the company? It would seem like in some of these examples, the promise of big dumb money, coupled with incentives to pursue cash flow-negative business models, coupled with the problems resulting from having to make good on the big dumb money investments while digging themselves in deeper with said half-baked business models, leads to them engaging in even more risky and externality-creating behavior. And generally promotes a toxic business culture that excuses bad behavior. If they had less money to play around with and lower expectations and thus less incentive to desperately flail around trying to justify their crazy valuations, could this behavior be preempted, or at least lessened? > Airbnb is a great business model (cash flow positive with solid growth). And yet, their losses were mounting pre-pandemic: https://www.cnbc.com/2019/10/17/airbnbs-quarterly-loss-reportedly-doubled-in-q1.html https://www.cnbc.com/2019/10/17/airbnbs-quarterly-loss-repor... > You should focus 100x this rage on the Permian Basin. Are you? You don't need to be livid with rage to mention someone is contributing to a larger problem, however proportionally small. You don't even need to mention climate change as a reason to blame ridesharing for driving up traffic; the increase in traffic is inconvenience enough, let alone its influence on public policy wrt urban planning, decrease in investment for transit, etc. > They could very quickly become cash flow positive if they wanted to (they would just have to change their growth trajectory). Great idea! Will they? Can they?

bobbydroptables 6y ago
>the capacity to cause problems for the rest of the world is much greater. And none of these problems should cause us to lose sleep. A few bad yelp reviews. Uh oh. Carbon emissions should cause us to lose sleep but nuking Lyft and Uber back to the stone age would probably have net zero effect on this. >Stories about early-stage Uber telling its drivers to drip off mustaches from competing Lyft vehicles come to mind, presaging the much more excessive and extensive abuses that later resulted. If you think this is bad you should read about how fire departments used to operate. Fierce competition is one thing that even critics of capitalism should support. Maybe not fire departments brawling, but consumers generally win when competition is fierce. The mustache things sounds hilarious but can't say I've heard of it. Can you link me? Did Uber HQ order its people to vandalize Lyfts? >It would seem like in some of these examples, the promise of big dumb money, coupled with incentives to pursue cash flow-negative business models, coupled with the problems resulting from having to make good on the big dumb money investments while digging themselves in deeper with said half-baked business models, leads to them engaging in even more risky and externality-creating behavior. And generally promotes a toxic business culture that excuses bad behavior. I don't see how this is any worse than the externalities and behavior of cash flow positive businesses. Are you arguing that Bechtel and Blackwater and Facebook and Amazon and Exxon have fewer positive externalities or better behavior? Capitalism has problems. But Silicon Valley and dumb money aren't it. Destroying the planet is it, but you'll see that with 99.99% of companies. Absolutely nothing to do with SV or dumb money. "Smart money" often invests in planet destroying things because they happen to be really profitable a lot of the time. >If they had less money to play around with and lower expectations and thus less incentive to desperately flail around trying to justify their crazy valuations, could this behavior be preempted, or at least lessened? I mean, none of the behavior you're describing is really offensive to me. I find the pizza arbitrage story funny and cute and probably a sign of running a sloppy business. I don't really care other than that because I don't own shares of Doordash. >And yet, their losses were mounting pre-pandemic: So your distaste for Airbnb arose precisely when their losses mounted? Or is it fair to say that your dislike of Airbnb has nothing to do with their income statement? Trying to make sure we're not getting two conversations mixed up. I understand you don't like Airbnb but that's not a very interesting conversation. I'm more interested in people taking personal offense to cash-flow negative businesses. >You don't need to be livid with rage to mention someone is contributing to a larger problem, however proportionally small. You don't even need to mention climate change as a reason to blame ridesharing for driving up traffic; the increase in traffic is inconvenience enough, let alone its influence on public policy wrt urban planning, decrease in investment for transit, etc. You don't need to do anything sure. It's just kind of silly to scream and shout about some dumb investors when a bunch of people are silently killing the planet and I rarely see these sensational news stories or comments about them. I see 10x attention about Airbnb causing rent prices in trendy neighborhoods. >Great idea! It's a horrible idea actually! This kind of thinking is why people hate investors that are only interested in quarterly returns. >Will they? If I were an owner, I would absolutely hope not! I guess I'm one of these strange investors that cares about long term value rather than short term returns. If they can take over taxis around the world for the next 30 years, I don't really care if they had a few unprofitable quarters. >Can they? Sure. If they just started charging the actual price for a ride, they would be making a lot of money. But that's not the business that investors wanted to buy.