this post was submitted on 20 Jun 2023
85 points (98.9% liked)

Reddit Migration

145 readers
1 users here now

### About Community Tracking and helping #redditmigration to Kbin and the Fediverse. Say hello to the decentralized and open future. To see latest reeddit blackout info, see here: https://reddark.untone.uk/

founded 1 year ago
 

Original take found on another forum.

"I think we're seeing the beginning of the tech bubble bursting again.

You've got the successful companies that provide a case study in tech industry profitability(Google, Amazon, Apple, etc.) which is why you've got all these venture capital firms plowing so much money into startups, left and right, because they expect that one of them will be the next Google or Amazon. Now that low interest rates have gone bye-bye, the VC firms are demanding that these startups start showing a profit. However, almost all of these startups have one of the following problems:

1.) They were never profitable and can never be profitable because the fundamental concept of what they do is thoroughly flawed
2.) The service or good they provide could be profitable, but due to being formed during a time of easy money, their current business model is incapable of being profitable, and they are too over leveraged to be able to restructure themselves into a more profitable setup
3.) They are perfectly sustainable/profitable, but their financiers expect far more return on investment than they are capable of providing

The result is the trend of "enshittification" as VC investors force unwanted changes onto these startups in the hopes of increasing revenue. This is stuff like locking previously free features behind a paywall, clogging everything with ads, cutting costs somewhere (payrolls, server space, etc) that negatively affects the user experience, raising prices, or needlessly bolting on something that nobody asked for because it's one of the only things that VC firms might still blindly throwing money at(AI).

Even the actually profitable companies are doing this shit because they are just addicted to the ridiculous growth they've enjoyed in the past."

you are viewing a single comment's thread
view the rest of the comments
[โ€“] [email protected] 5 points 1 year ago (1 children)

The law requires the board and the top executives of any corporation to behave like sociopaths with regard to the business. They have a legal responsibility to their shareholders to maximize profits. That supersedes any responsibilities to their employees, their customers, or the general public.

In 1916 Henry Ford reduced Ford's dividend payments to shareholders so he could increase the salaries of his employees. Some shareholders successfully sued him for it and won. He was forced to eliminate the raises and pay the higher dividends.

And we have been stuck with the inhumane results of that court decision ever since. Corporations aren't bad by accident. They are bad by design. They are legally required to be bad. It isn't surprising that the people who are often the most successful at making sociopathic decisions are themselves sociopaths.

[โ€“] [email protected] 2 points 1 year ago

Only when they go public. I'm constantly astonished at this decision making.