VCs prop up money-losing unit economics to “reduce friction” while making the company grow quickly and dump on the public. Figure out the business model later.

VCs prop up money-losing unit economics to “reduce friction” while making the company grow quickly and dump on the public. Figure out the business model later. Rinse and repeat. For example WeWork with Neumann or Uber with Kalanick. Is negative unit economics better than a token with absolutely no utility? I would say yes - because they often create a valuable marketplace that serves customers and pays providers. They just find out later that they are in a race to the bottom with other platforms. Which means healthy market competition. However, if the stock continues to do well, it means the shareholder class (now representing public shareholders) continues to extract rents from both sides of the ecosystem. Uber is still extracting rents years later… drivers pay it half what we pay them. An open source platform economy would have been better for the public, with none of the controversy of Big Tech platforms. All these Ubers could have been had source competitors a long time ago. Why don’t they?