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In the worst case, debt is a trap that can compound and be difficult to come back from. In the best case though, it can be a very useful tool. Every homeowner

In the worst case, debt is a trap that can compound and be difficult to come back from. In the best case though, it can be a very useful tool. Every homeowner who takes out a mortgage and gets to live in their home with their family for 30 years before they've fully paid off their house is effectively and productively using debt.

mym1990 6y ago
The one thing I would add is sometimes tech debt needs to be paid off at unexpected times. There have been several instances in my current work where a piece of the application broke due to poorly written code, and refactoring was an immediate need, no matter what else was going on. I imagine home loans would look a little different if there was a small percent chance on any given day that the bank would show up and ask you to pony up. But in general, debt can be good given the right agreements in place.
shusson 6y ago
> Every homeowner who takes out a mortgage ... is effectively and productively using debt I understand taking a loan from a business perspective, e.g buy more tractors for my farm to increase productivity. But how is using debt to buy a house increasing productivity?
- shagmin 6y ago
  In the monetary sense the the farm productivity may equate into growing more of something you can later on sell. In the case of the house, it equates to gaining an asset (or at least equity in an asset) that you can later on sell, also. But in a more abstract sense it's not all about money - it's about getting around roadblocks, for a cost. For example, being productive can include things like getting stuff done that you've been neglecting. Maybe a person bought a house to have space to practice yoga at home or something like that. They're knocking out things they've wanted to do but couldn't before. Also maybe increasing the demand of housing in your community by buying a house makes the local construction industry more productive.
danjac 6y ago
If you were to compare it to a homeowner, tech debt for the average startup is more like someone deciding to build their own house with neither relevant skills, planning permission nor expert advice and desperately trying to keep the whole thing from collapsing into the foundation while simultaneously building balconies and extensions on every floor (think of the worst episodes of that Grand Designs TV show).
- beckingz 6y ago
  No wonder banks refuse to lend to most startups!

mym1990 6y ago

The one thing I would add is sometimes tech debt needs to be paid off at unexpected times. There have been several instances in my current work where a piece of the application broke due to poorly written code, and refactoring was an immediate need, no matter what else was going on. I imagine home loans would look a little different if there was a small percent chance on any given day that the bank would show up and ask you to pony up. But in general, debt can be good given the right agreements in place.

shusson 6y ago

> Every homeowner who takes out a mortgage ... is effectively and productively using debt I understand taking a loan from a business perspective, e.g buy more tractors for my farm to increase productivity. But how is using debt to buy a house increasing productivity?

shagmin 6y ago
In the monetary sense the the farm productivity may equate into growing more of something you can later on sell. In the case of the house, it equates to gaining an asset (or at least equity in an asset) that you can later on sell, also. But in a more abstract sense it's not all about money - it's about getting around roadblocks, for a cost. For example, being productive can include things like getting stuff done that you've been neglecting. Maybe a person bought a house to have space to practice yoga at home or something like that. They're knocking out things they've wanted to do but couldn't before. Also maybe increasing the demand of housing in your community by buying a house makes the local construction industry more productive.

danjac 6y ago

If you were to compare it to a homeowner, tech debt for the average startup is more like someone deciding to build their own house with neither relevant skills, planning permission nor expert advice and desperately trying to keep the whole thing from collapsing into the foundation while simultaneously building balconies and extensions on every floor (think of the worst episodes of that Grand Designs TV show).

beckingz 6y ago
No wonder banks refuse to lend to most startups!