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> Corruption within private companies is irrelevant, as the main ones to suffer from it are usually shareholders.

And a few millions of people suffering because they're being misled into buying "wellness" solutions.

And a few hundreds of millions of people around the world suffering the effects of local pollution and clean water laws being skirted.

And a few billion folks who are gonna suffer the effects of climate change.

etc...

Other than the 6-7 billion humans who suffer due to private company corruption, it's basically only the shareholders.


"customer" is a much better term IMO. It indicates this is ultimately a transactional relationship where both sides have certain responsibilities. The customer the responsibility to provide the money, and the provider receiving the money has a responsibility to provide the customer with something, products or services, of value that makes their lives better.

"user" is a worse term. It suggests that the "user" is simply utilizing the provider's products/services, and therefore they can't really complain about whatever the provider chooses to do in return, because the "user" can simply stop using.

It's also not a coincidence, IMO, that drug addicts are also called "users" since "user" implies a one way dependent relationship and that's what all the tech companies have been trying to create.


> "It's also not a coincidence, IMO, that drug addicts are also called "users" since "user" implies a one way dependent relationship and that's what all the tech companies have been trying to create."

You're drawing a connection that's not there. It's indeed not a coincidence, but just because both situations fit the definition of the word "user" (and "to use").

People use drugs, whether they're addicted or whether they're taking a one-off dose given to them by a doctor. They are a customer in that situation if they're buying the drug from somebody (illegal dealer, pharmacy), but they're a user whether they paid or not.

Likewise, someone is a customer if Apple's if they paid for, or are expected to pay in the future, a device or service. But they're a user regardless of whether they're using a phone they bought, or a service that's being provided for free.

People can use services provided by charities, they can use skis on a mountain... there's absolutely no negative connotation to its general definition, it just happens that some things people use are bad and some are good.


"And don't say 'do it' because i don't 'do it', i ingest it, on orders from my neurophysiologist."

I agree that “customer” is a better term. I’m not sure I agree with the rest of the rationale.

In my mind, “user” stated to take over when we started having web based services that were used by people, but they were the ones paying. For example, Google and Facebook. Both got paid through ads, so they advertisers were the customers. The “users” were just the eyeballs the advertisers wanted to reach. So, you had to make your service compelling enough for someone to use for long enough that they’d see enough ads to make it profitable to provide the service.

It’s more akin to talking about “viewers” or “viewership” when talking about more traditional media.

For Apple, they are generally looking to get paid by the ultimate consumer of the product. So to them, we are the customers.


> In my mind, “user” stated to take over when we started having web based services that were used by people

Maybe I'm just old, but we've called ... users ... 'user' since Unix or before. Perhaps it is just because Unix was integral to my early computing experience that I see it that way.


User is definitely a term that long predates the modern SaaS world. And it’s an appropriate term in many cases because even today the customers of a computer hardware or software company are often not the same people using that hardware or software. I am the user of my work computer, but even as a software developer I am certainly not the “customer” of that purchase. My company has requirements as a customer that might be counter to my desires as a user. And likewise I have needs as a user that my company as a customer does not care about (except in so far as having those needs met allows me to do my job)

"user" feels quite descriptive and neutral to me. It's a person that uses the device they own or are given access to. That's it.

I'm the (super-)user of my Linux PC. I have total ownership and control over it.

Arguably "customer" makes the business relation to the provider of a service/device clearer.

The term I hate with a burning passion is "consumer".


Definitely agree on your last point, "consumer" is by far the most passive of the terms, and wholly represents the current idea that companies can simply shovel out anything, because "consumers" will simply consume either way. Of course this isn't magic, a single person won't change just because you call them a user or a consumer, but it reflects your view of them, and will inform your actions towards them.

"customer" represents a two-sided relationship, and I do feel that "user" is kind of one-sided, but gives agency, a user will use a product for their own purposes, presumably to help them achieve some kind of goal. A "consumer" is completely passive, their main goal is to do what the company tells them to do. A customer can walk out of the relationship, a user might complain about problems they have with your product, but the consumer will simply continue consuming whatever you want them to consume.

The worst part though, they seem to be mostly correct in their assessment.


I'm curious what you think VCs, etc. who are investing in all these private companies want to do?

The only difference with public companies is we actually have data about their finances.

The private companies are doing it all under wraps.


Don’t conflate two different investment models.

1. Investors who want to invest in companies with a growth story and want the company to grow bigger and be “successful” enough to exit either via an acquisition or the public market. But often times these days, just to pawn off to the greater fool.

https://medium.com/@Arakunrin/the-post-ipo-performance-of-y-...

2. Investors who want to go in and make the company worse and do enough value extraction for short term gains. The canonical case is when a restaurant chain owns its own real estate. They split off the restaurant from the underlying real estate and make the restaurant pay rent that goes up. The restaurant flounders and the real estate holdings increase in value.

And another strategy is to acquire companies in your vertical, roll them all up, fire redundant staff and integrate systems and then exit. Of course you enshitify the smaller once independent mom and pop systems in the process.


This is correct.

This isn't a financial transaction. This is a "relationship" transaction.


Are there other examples of well capitalized technology startups that have significant revenues that have also opted for significant debt financing?


I'm going to paraphrase Matt Levine here -- the central trick of bankers is to divide debt into tranches of claims of different seniority, with different rates of return. Debt is a way to borrow money from investors where they actually have a generally low rate of return specified and have a senior claim on being paid back in the case of insolvency. Stocks are a way to borrow money for investors where they get basically _nothing_ in the case of insolvency, but they expect a higher return from either dividends or stock buy backs, or just from company growth. Different investors have different goals in terms of risk/reward for what they want out of a company they invest in, and providing investors more options unlocks more opportunities to raise money.


Amazon issued $1.25 billion in convertible debt in 1999: https://www.wired.com/1999/01/an-amazonian-debt/


Convertible debt is very different: if you do the same (simplistic) analysis as in the article, it behaves almost like the equity example, not the debt one.


We had way more debt than venture financing in the pre-ipo days of DigitalOcean. Thanks Michael Dell!


As a shareholder, thanks for going the convertible debt route! I like the fact that the company became profitable but the call option component of the previous round of "senior convertible notes" expired out of the money.

Comparatively speaking, I don't know why investors won't touch DOCN with a 10-foot pole, but I will gleefully reap my returns from dividends and stock buybacks when DOCN laps AWS in 20 years with better services maintained by better engineering staff.


It's so common that mismanagement of risks associated with it led to the fall of Silicon Valley Bank.

This Forbes article has a good overview: https://www.forbes.com/sites/amyfeldman/2023/03/19/silicon-v...


> well capitalized technology startups that have significant revenues that have also opted for significant debt financing?

Debt is almost always cheaper than equity. Particularly if you can collateralise.

Well-capitalized companies rejecting debt is more of a Silicon Valley outlier in the global economy. (It likely stems from dot-com trauma.)


It stems from the relatively low capital requirements of tech companies relative to other industries (pre-LLM). Now that this factor has changed we see them rapidly adopting debt financing for their capital intensive LLM projects.


> stems from the relatively low capital requirements of tech companies relative to other industries (pre-LLM)

Not really. Tech, including low fixed-cost software, has been tremendously capital intensive for decades. Early-stage start-ups lack the cash flows to fund debt. But post-Series B companies raising equity are generally doing so for idiosyncratic reasons, e.g. capital sponsors being concentrated in equity for historical reasons, valuation escalators and capital denial to competitors.


I don't think you understand what capital intensive means. Many tech companies are started out of their founders apartments for essentially 0 startup cost and from here the only serious costs are salaries and AWS. There's a reason that tech founders get so much richer than founders in other industries and that reason is because the minimal capital requirements allow them to sell off so much less of the company before reaching massive scale.


> don't think you understand what capital intensive means

I may have missed something in my career on Wall Street, as a founder and in VC.

(Being wrong is fine. Being confidently wrong is dumb.)

> Many tech companies are started out of their founders apartments for essentially 0 startup cost

You’re mixing up fixed costs and capital. Both fixed and operating costs consume capital. (We call the latter working capital.)

(You may also be mixing up PP&E and capital.)

> a reason that tech founders get so much richer than founders in other industries and that reason is because the minimal capital requirements allow them to sell off so much less of the company before reaching massive scale

This is wrong. Obviously wrong.

Tech founders get richer because their companies get bigger. Apple, Tesla, Google and Saudi Aramco have massively different capital requirements. Their owners (and founders/founding lineages) are in the same ballpark.

Similarly, most family businesses never sell equity until they sell the business. And most tech founders don’t have a majority of equity after a couple rounds.


>Well-capitalized companies rejecting debt is more of a Silicon Valley outlier in the global economy.

IMO it's because CFO is treated as a second-tier C-suite role in Silicon Valley and a lot of the CFOs are completely substandard as a result.

A lot of CEO have the mentality that if the product and the tech works the money sorts itself out, so your CFO is already behind the CTO and the CPO.



This is literally the reason behind the collapse of Silicon Valley Bank. Debt keeps your cap table untouched, its very tempting at certain stages


Are there other examples of well capitalized technology startups

I think we're well beyond the point where OpenAI can be called a "startup."


Pointless argument unless you define what startup means.

Different dictionaries provide different definitions.

A common one is that it's small and recently started business, but it's a very vague boundary.


Half a trillion dollars isn't "small" no matter how vague you want to make the boundary.


Neither a billion isn't small no matter how vague you want to make it, yet, we label startups with this valuation as unicorns. So where is the boundary? 10 billions? 100? 1000?


Yeah, your local friendly police officer isn't gonna do that.

They're gonna pay Anduril, Palantir, and a whole host of other business or consulting firms a ton of your money to do that.

The criticism that "it's technically too challenging for the police department therefore its sci-fi" is extremely silly given that the current article literally is about private companies that are building surveillance networks that they will then sell to the police.

Which makes the entire situation a lot worse.


It's a lot cheaper to just bust the door down, toss in a bunch of flash bangs and light up anyone who doesn't have their hands raised. Maybe they'll just send an armed robot in first if there's a specific threat involved.


Or a Roomba... One of the first things they want to do is make a plan of the house.

But also, don't builders have to submit plans of homes to the local government when building them for approval?


Most robot vacuums (at least the ones that use LiDAR, which seems to be the majority) can only capture a very rudimentary plan of your house, that being a 2D image taken at an elevation of ~10cm or so. It will also be obstructed by any large objects, and there's no easy way of telling them apart from walls.

Your government probably knows your floor plan (though, I don't think they tend to be publicly accessible). Either way though, neither of these methods are anywhere near enough to do what was shown off in those Wi-Fi tracking demos. Here's hoping the tech doesn't get a lot better or has a series of unexpected breakthroughs.


This wasn't a non issue. You touched the phone in the wrong places and you would drop off an existing call.

Most people solved this by indeed not "holding it wrong" or getting cases (I don't know if the cases worked, but there was a whole industry built around advertising cases that solved this problem).


AFAIK the cases worked because they prevented the hand from making electrical contact with the metal parts


Apple's interim fix was to give all the owners a case.


There are 2 problems to this.

1. I seriously doubt Apple was accidentally displaying more bars on the phone. If it was a "bars" issue then it was almost certainly done deliberately to make the iPhone reception look better than what it was.

2. It wasn't just bars. I had this phone and you would literally drop off calls by holding the phone differently when you hadn't done anything else. There was a genuine problem with the phone that I don't think was ever resolved other than people getting used to holding the phone differently like Steve Jobs told us to.

I lost my iPhone and switched to a hand me down from my parents which was a generation older and the service was significantly better.


Yup, that's what they will do now.

Which is indeed a benefit for their countries.

And is a loss for the US.

The brain drain was real and the US was the beneficiary and that may be ending soon.

Not sure what your point is? Are you happy that the US will be worse off than it was before?


I think America will be ok.


Being okay is a lot different from maintaining academic, innovative, and cultural dominance which provides a standard of living many have grown used to.


Are you saying America was a backwater nation until non-european immigrants rescued them?


Are you saying America was ok taking immigrants only as long as they were European?


That was the law up until the the Hart Cellar act of the 60's.


I'm asking about things working better when only Europeans were allowed, not the law. You were implying the former with your comment.


there's objective evidence That things were working better when only Europeans were allowed.

https://wtfhappenedin1971.com/


I don't think that website implies what you're thinking. The only significant thing that happened in 1971 is that Nixon suspended the convertibility of the dollar into gold, giving the US leeway to run unlimited deficits, paying for imports with paper.

Now, America wants to reduce its debt and curb industrial powers like the EU, Japan, China, etc. but it doesn't want to give up its exorbitant privilege that got it into the debt whole in the first place.

You can't have it both ways.


Its just data.

It could be a result of numerous causes.

My point still stands.


No, your point doesn't stand at all. It's completely baseless. You took a detailed resource referencing America's departure from a gold standard and you're twisting it to support your pet immigration policy.

Now, if you want to limit non-European immigration, it's a personal opinion and you have a right to it, but you can't make a blanket statement that, "everything worked better," or misinterpret data to say what you want.

Don't pretend you're being data-driven when you've made up your mind and now you're trying to torture the data into saying what you want.

What metrics are you measuring by?

So, while it seemed like you were trying to argue logically, it appears your argument is: I don't like non-Europeans. And you're trying to massage the data into showing your opinion is data-driven because it can't stand on its own merit.

But, feel free to change my mind with more data.


Aah racism. Cool cool cool glad you got it out there.


I think it’s pretty clear that’s not what I’m saying.


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