Random shitposting aside, I do feel this bears discussion, albeit in a less fingerpointy way.

Wikipedia lists Tim Draper as a "third generation venture capitalist" which is kinda tough for me because - playing the Old Card here - bad ideas used to be dangerous or niche not outright fraudulent. Lawn Darts. Salad Shooters. Pet Rocks. Vegematics. The products we used to make fun of were either trendy things that we didn't actually need or outright scams - compare and contrast ZZZZ Best and WeWork. Barry Minkow had to go to the mob because his idea was clearly fraudulent. Adam Neumann could go to Matsayoshi Son.

The idea used to be that venture capital allowed ideas and products that weren't backed by major industrialists to come to market. The idea has become that venture capital allows ideas and products that aren't backed by Kickstarter to provide a profitable exit as they get sold or become publicly traded. I don't think VCs are inherently evil, but I do think that the financialization of the process has divorced it from public judgment. I mean, this is a dumb fucking idea:

It's an even dumber fucking idea than this dumb fucking idea:

And anybody who touches it can tell you. But that's not what we do anymore. We start in "stealth mode" where friends of rich people spend money. Then we do a hype cycle where friends of rich people spend money. Then we do the barest-of-bare engineering and design to get a "minimum viable product" out the door and do the hype cycle again, and then it hits the public who howl like banshees about the stupidity. Meanwhile the VCs - the guys in charge of the process - get paid. The engineering and design teams get a bunch of stories they may get to tell someday when their NDAs expire. And Wired gets to write a feel-good story about that plucky band of online adventurers - the "makers" - rescue a bad fucking idea just enough where they can continue to masturbate all over it.

"Stupid products bought by VCs" didn't used to be a genre of television, man. And while the VCs are clearly culpable I'm unconvinced they're solely responsible for this. Obviously they do better with a higher hit/miss ratio but just as obviously they're profiting anyway.

If you brought the nunc to market through, say, a pre-2008 economy you would find no shelf space. It would be an expensive thing with expensive beans. The model for dumb shit like that would be to give you a free coffee maker to lock you into the beans - the first PS3s cost $900 to make and sold for $500 because Sony wanted your living room. Prior to the iPhone cellular carriers lost money on the damn phones to lock you into a contract. Prior to that, I mean - you couldn't buy a phone from AT&T, you had to rent it. Lock-in isn't new, it's the idea that you should mortgage your house for the privilege of overpaying for fucking juice.

Here's a guess:

This shit dates back to the slaps on the wrist everyone earned from exploiting the shit out of non-GAAP accounting.

The use of non-GAAP financial measures began to change in the 1990s, when companies began providing non-GAAP earnings and disclosures that they argued provided investors with improved insight into the company’s ongoing core business earnings. When presenting non-GAAP information, companies have significant discretion in adjusting GAAP-based earnings by excluding noncore expense items or including revenue items not recognized under GAAP rules. In response, the SEC continues to evaluate whether companies are using their discretion in non-GAAP earnings reporting to inform or mislead investors. This article details the SEC’s historical treatment of non-GAAP measures, reviews problems associated with non-GAAP measures, and provides ways that a company’s auditors, accountants, executives, and audit committee members can reduce the probability of a non-GAAP disclosure being deemed misleading.

My first exposure to this nonsense was in 2006. I worked for a company that had every plan to become the #1 source of music in the world (reader, they did not). Their big metric was EBITDA - Earnings Before Interest, Taxes, Depreciation & Amortization. In other words, "every possible way to make the balance sheet look good without listing anything what-so-fucking-ever related to running a business." It'd work like this:

We'd sell a music subscription to, say, Bank of America. The idea is, they're going to give us $20/mo for piping the Fugees into the lobby of every BofA. That's 6900 banks! That's $138k a month! $1.66m a year! Except we're going to give them a 40% discount for the first two years. So really, it's $993k a year. And we're giving them the system for free. Which, with installation, comes in at $2500/store. So... $17m in outlays. And it's a five-year contract. So... we're spending $2500 to earn $1000... seven thousand times. Except what we report - non-GAAP - is $140k a month in recurring monthly revenue (RMR) STRAIGHT INTO THE VEINS of our EBITDA. It gets better though because I report the price of our player as zero dollars because we make it and we can give it away. The player department reports 6900 sales at $1200 ea because non-GAAP, we just "earned" $8m from selling players to Bank of America.

Fifteen years later, long, long, LONG after every shop you know is running a Spotify playlist, that company was acquired by a conglomerate using private equity money. Why? Because the RMR is still theoretically there while all the losses have been washed through investors.

I think fundamentally if you create a climate where people get away with crime, there will be crime. And if you don't call it crime, people will call it "the business environment." And here we'll be, wondering how the fuck they can think we'll pay $3500 for a coffee juicero.