i feel conflicted on the future of software. when i look at the internet and see what plagues it, too much is the fault—whether of direct or indirect consequence— of the way it's grown. the ease of building on the internet comes back to hurt itself. i'm bothered by the prevalence of (and dependence on) venture capitalism.

i realize that the average person probably has only the vaguest of ideas what vc is, if they know it exists at all, yet it's the reason behind a lot of what people hate in the internet (mostly enshittification). people blame the corporations for being greedy but venture capitalism is what incentivizes and rewards it.

in short, venture capitalism (also known as 'angel investing') is when rich people gamble on startup companies, give them a lot of money in case they make it big, in which they get a return. most of (almost all) fail, and they plan around this. the 10% (number made up) that succeed pay for the 90% that fail. in a vacuum, this is all fine and dandy, but the issue is that 100% of those startups are trying to be that 10%, which results in things like a social media platform allowing na i feel conflicted on the future of software. when i look at the internet and see what plagues it, too much is the fault—whether of direct or indirect consequence— of the way it's grown. the ease of building on the internet comes back to hurt itself. i'm bothered by the prevalence of (and dependence on) venture capitalism.

the chase for infinite growth is unsustainable, yet that is what 'angel investing' demands. i find humor in the irony of the name when the terms of the money are more closely aligned to a devil's contract. it's an all or nothing gambit. ideas that are started from an innocent idea turn to perverse tactics to meet these unattainable metrics.

Twitter allowing Nazis to exist on its platform to drive 'engagement.' Uber creating Greyball to expand to locations against the interests of the law— and then turning it's back on those it's growth relied on.

Medium, for example, is a success story. Fell in a hole, got out is the CEO's recollection of how he managed to turn an internet publishing company, doomed by it's debts to these investors, into an independent one.

[The previous CEO] had two eras [at Medium]. The first was the design era where the team reinvented what a writing platform could look like, both simplifying and beautifying every part of the experience. The second was the invention of a new business model, moving away from the toxic incentives of ads and instead offering a single bundled subscription that any writer could share in.

The first part is a genuine desire to make positive change. The second part—the part where you need to make money to pay off your debts— is where things went wrong. Building things on the internet is fast. Figuring out business plans is hard^{[citation needed]}. They got it wrong and, as a result, lost more money.

An important thing to be aware of in these arrangements with 'angel investors' are the existence of 'liquidation preferences.' As the article puts, it 'boils down to the investors get their investment money back before the employees see any return.' It's important to also note that by accepting this money, a company sacrifices agency as to make big decisions, the company needs to get a majority approval from the investors. This is where Medium is an unusual circumstance: in its rut, the startup market was 'frozen.'

In a healthier market, the loan holders might have been able to force a sale. But in that frozen market, the Medium team really held the most power: give us an incentive to do the work or we walk and you’ll take a complete and total loss.

In other words, Medium's entire recovery was only possible because nobody would have bought them. I don't write this to discredit what I'm sure was a herculean task to save Medium... but was a writing platform, of all things, needing of millions of dollars to get started? (161 million in total, for accuracy's sake)

I do believe that venture capitalism has its place in society. There are areas of business that require significant amounts of money to get started and it makes that possible. But the thing is, these systems of investment plan for failure.

In the past year, The Browser Company, behind the browsers Arc and Dia, was acquired by Atlassian. Astro, an open source static site generator, was acquired by Cloudflare.

It's too soon to tell whether or not these will be positive things but there's commonalities to draw from each of them. Firstly, neither Astro nor The Browser Company contribute to their acquirer's bottom line. Atlassian builds enterprise tools, Cloudflare provides internet services. Relevant? Sure. Directly contributing to profits? Not really.

what happens to companies that are acquired but don't make money? gatsby

examples of what i believe are good acquisitions: bun and anthropic

open source funding https://natemoo.re/posts/missing-middle/ i got this in the index newsletter, reminds me of this: https://www.podcastawesome.com/2092855/episodes/18615318-how-eleventy-survived-funding-growth-and-open-source-reality. interesting how both popped up at this time— it was at the end of last week i was considering moving off of eleventy to astro. the reason? the templating language i use doesn't have a formatter. ...feels a little needy on my behalf, it's not like my needs are that complex and an html formatter works fine for it anyways.