> Then it raised venture capital, hit scale, and needed to hit growth numbers and meet quarterly metric goals. The focus shifted from “authenticity” to “daily active users.”
Having spent a few years in the VC world I have been increasingly convinced outside investment is the biggest reason why companies lose their morals. The legal obligation to represent shareholders erodes morality. When the people running these companies feel they’re beholden to shareholders and can’t act on their own agency of course they will turn to addiction research not as a warning but as a guidebook. It’s Stanford Prison Experiment stuff.
I hate being reductionist, and I am posting this on a historically YC forum so of course there’s nuance, but there’s a pretty huge throughline of outside investment and addiction engineering. It sucks we’re seeing less grants and less security net to encourage risks under current administration, because it leaves investment as the quickest path to starting or scaling a company. Donate to open source, IMO
I feel that it's even simpler: The company is the product.
When we have that mindset, we absolutely don't care about the thing that we call "our product." It's just food for the actual product, where we want to fatten it up, and sell it to the biggest slaughterhouse.
That starts almost immediately. You can't even get an A round, without an "exit plan."
I feel that the very existence of an exit plan, dooms the user. No one cares about them. It's all about fattening the company, and making it look good. When we do that, we'll feed it nothing but junk food, in an effort to make it as fat as possible, as quickly as possible, with absolutely no thought as to long-term viability.
I would love to see the tech industry return to concentrating on truly delivering good to the end-user. It's still possible to make a decent living, but maybe not at the insane rates we see.
"The company is the product." -> When I'm feeling more optimistic I see this is how VC sees their portfolio and how you sell it to them, but not what the company is in reality. Like playwrights who write under authoritarian regimes selling it to the censor as promoting the regime while it actually satirizes and undermines them. But even if it's possible to walk that line, the data just doesn't back it up as common.
Side note, on "exit plan" - the most ridiculous thing about raising money is you need an exit strategy but you cannot explicitly say you have an exit strategy, you have to imply it while the whole time pretending it's not a focus for you. It's a very weird dynamic.
If you've ever dealt with Investor Relations at a public company, this becomes very apparent very quick.
Core fundamentals as a business can be strong, but if you cannot craft a unique story or thesis (which does not have to be tangentially related with active initiatives) about your company, you will not succeed.
Usually, the onus should fall on PM, EMs, and Sales Leadedship to drive customer outcomes, but the hyperfocus on short term deliverables AT THE EXPENSE of a long term product vision makes it difficult to push back.
Very few newly founded or public companies can do the latter - the most recent ones I can think of are maybe Datadog and Wiz (not public but they did drive a customer centric mentality internally).
Of course, a lot of this is also due to the extreme bloat that formed in the tech industry in the late 2010s to early 2020s. Teams grew unrealistically large with limited financial justification beyond cherry-picked growth metrics, and this meant a lot of companies lost the ability to innovate frugally or nimbly. Unrealistically high valuations also played a role because towards the end, founders could end up demanding IPO-sized multiples in private markets even without the underlying fundamentals (eg. Lacework's $9 BILLION valuation on what was at most $90 MILLION in revenue).
A lot of the current AI products and stories are cost-competitive due to that bloat itself, so some amount of rightsizing will help the industry.
When you really think about it, this also applies to very many publicly traded companies. Tech especially, always searching to present next growth area. And then often shortly abandoning it or wasting massive resources on it...
To be clear, business operators have extremely, extremely broad latitude in how they interpret their fiduciary duty to shareholders.
We actually need to combat this notion that somehow exclusive focus on short term returns is somehow legally, morally, or ethically required. It is actually antisocial and obviously destructive.
There is no latitude. They have only one requirement: growth growth growth.
If you hit the growth targets, they will pat you in the back and will demand Hyperscale growth growth growth and will throw money at you to supercharge it.
If you refuse to chase the growth, they will simply kick you off the company via Board or fund your competitor that will chase the growth at all means
Yeah, I think it honestly lets founders off the hook too much.
In 95% of cases, the founder isn't smashing moral barriers because the VCs and shareholders are making them, or lording the threat of legal action or any some such.
In 95% of cases, the founder is smashing through moral barriers because their interests are aligned with the VCs: because they think what they are doing will lead to stupendous mega-wealth for them personally.
Like sure, I think the idea that corporate execs must be beholden to maximizing share price is a) corrosive to our society and b) not as true as often portrayed, but I don't think that's even a real factor here.
> To be clear, business operators have extremely, extremely broad latitude in how they interpret their fiduciary duty to shareholders.
Legally maybe. The market and shareholders will punish you if you deviate from the current standard behavior.
We’ve all seen companies do layoffs just because “Wall Street” was concerned about the economy and then instantly see the stock price spike up.
These negative consequences are all results of bog standard prisoner dilemma issues that need government regulation to make sure everyone picks the good square, but the tech industry and this boards community as well is allergic to the idea that regulations can improve the situation for everyone
Maybe in theory, but in practice there is a strong power mismatch that causes investors to have a strong influence. Sand Hill learned it's lesson from Facebook/Zuckerberg and now always have a seat on the board. Only outliers like zuck/bezos/similar have the weight to push back against investors. Heck, even Dorsey couldn't for whatever reason.
And even if what you said is true, you can look at the results of years of this system, the difference between companies with outside investment vs without makes a strong case against what you're saying.
It's like saying educating people about their rights wrt police helps, but in practice police don't derive their power from actual laws and it comes at considerable personal expense to push it to courts, in the same way Delaware is very strongly biased towards shareholder rights.
> To be clear, business operators have extremely, extremely broad latitude in how they interpret their fiduciary duty to shareholders.
That may be true legally, but practically it's only true if they control the board. Otherwise they will simply be replaced by people who are willing to do what the board wants.
Even focusing on short term profit would be fine, if you want to blow up the business go ahead, if those profits were actually shared fairly with shareholders. Too often companies can just dilute their stock over and over, which fucks over individual investors and benefits the 51% owners, and investors don't really get a say, yes there's a vote but if 51% is owned by a few it's not a vote.
Individual investors are largely operating on trust.
> The legal obligation to represent shareholders erodes morality
This "legal obligation" is an internet rumor that does not exist in the real world. Yes, if your company has competing buyout offers of $1m and $2m and the board takes the $1m offer because they received a bribe, it will come up. Otherwise, it never does.
The proof is in the pudding (please go find me even one case where shareholders have successfully imposed their will on a board or executives because of this obligation), but it doesn't even logically make sense. Other than the buyout example, it's hard to think of almost any action a company could take that doesn't have some justification that it is for the benefit of shareholders. i.e. if we make our app too addictive, we risk social backlash and regulatory intervention by governments which will hurt out shareholders. And that's all that is needed, because there is no associated time frame with this obligation.
To be clear, boards and executives might strive to please investors, but it is not based on a legal obligation. An executive that ignores the interests of shareholders might be concerned about their reputation as a capable entrepreneur, risk losing their job, or devalue their own shares, but they are no in legal jeopardy.
Just because the risk of getting successfully sued for making decisions against the interests of shareholders is low, it doesn't mean that it won't influence executive decision making. CEOs want to avoid legal risks above all else and thus the laws around fiduciary duty can have a chilling effect even if judges generally go along with the CEO's interpretation of what is in the interest of shareholders.
I think its bigger. Morality and social contract have eroded and continue to erode.
Look at Mozila for the most insidious example. Take a privacy focused product. Rope in a bunch of suckers. Then literally delete the privacy focus from your mission statment and start the "slaughter"
Craiglist is proof it can be done at scale.. Its just that so few people with them means and morality exist anymore. The Sodom and Gomorrah fable is a warning not to let this happen or your society will destroy itself.
> Craiglist is proof it can be done at scale.. Its just that so few people with them means and morality exist anymore.
I don't think this is a good example. Back then, the internet was a new thing only a small cohort of people cared about. Something small could just stay small because none of the big players with money cared. Nowadays, if someone wanted to start something like Craigslist, they would be outrun by someone else going the VC route before the small company could get big enough on its own. I think it boils down to the difference between slower growth, boot-strapped companies vs. VC-backed.
Another reason is optimization for profit, combined with competition making it a survival necessity to do this.
Early in a nascent industry, you focus on the core product. You bring scale and scope economies. You make the supply chain more efficient. You improve the logistics. More abundant basic food stuffs for everyone, and more profits for agriculture shareholders. A true win-win.
Later on when the industry matures, the easy wins are all gone. Logistics and agriculture is fully optimized. The only scope for improvement is in marketing, adding sweeteners, and cutting out expensive ingredients. Now it's a lose-win, but from the shareholders perspective only, it's a win.
The problem is, you can't just ask companies to act nicely. While that would be a good start, even if they genuinely wanted to, competition largely forces their hand. The solution is careful and minimal regulation, to deter the pathological late-stage optimizations.
Just a heads up, the experiment was complete fraud and could never be replicated.[1]
I agree with you that outside investment can work as a strong accelerator for these things. It enables founders to externalize responsibility.
However, it is not the main reason. Exploitative companies have existed long before venture capital was invented. In the end every company exists to make money and so is inherently immoral. That is why the state is needed to regulate the market so companies don't hurt society too much.
Those founders didn't get corrupted by evil venture capital, they didn't have that strong of a morality to begin with.
I think the VC thing is indicative of the entire thing; the goal is profit and everything is subordinated to that. This is how the system works and how it is designed to work. When profit and some external thing like social responsibility are at odds, profit is going to win out every time. The mercenary mentality rules the scene.
In Magickal Faerieland, we have regulations to align those 2 things by incentivizing the "goodguy" path and/or disincentivizing the "cackling villain" path but we live in reality where money rules and regulatory capture is a thing. So a Facebook or other megacorp can get away with using neuroscience and psychology to engineer a virtual slot machine with a terrible payout and ExxonMobile et al can get away with being an architect of environmental degradation and the accompanying humanitarian disasters.
Of course VC loan sharking is a major part of the problem. But it's also tiring reading blog after blog of people who say they want to do the right things and do them right or whatever the trendy thing is that month, all as a thinly veiled pretence to get as much funding from whoever wants to give it to them and try to make themselves the next Zuckerberg or Bezos.
If people actually believed in something they'd make it open source or a non-profit, not a convenient vehicle for personal enrichment. Imagine if Wikipedia was a for-profit startup, it would've eventually ended up as an unusable cesspool of advertising.
Yes, and there is a huge problem connected to that:
If you don’t play this game you’ll lose. Look at Europe for example, they haven’t played the VC game properly and thus have no really significant tech player compared to the US / China.
So what options are left? Play the game or be ruled by those that play it.
I’d rather play even if moral erosion is required.
I think Europe is moving g toward digital independence even more. They've still got Instagram and WhatsApp and everything, but I can see them moving more aggressively toward Facebooks core business model (ie, programmatic adverising) and essentially creating a European internet bubble. Would be nice for Europeans to be able to have their own social media sites which operate less aggressively on your attention span - like Facebook circa 2009 or even MySpace. Chronological feeds, less invasive advertising practices.
Its not just shareholders, stock based equity also has all the employees pushing profit.
Engineering addiction is also probably more often than not intentional. When all the business metrics/KPIs are stuff like "engagement time", "$ spent", even AB testing of random features leads to manufacturing addiction
Well, yes. Encouraging people to avoid Marxism and all the successive schools of thought has done irreparable damage to this country (and likely the entire west). And I'm not even dogmatic about this: you can read Schumpeter, the father of VC, to reach the same conclusion. Private investment will eat the world and our childrens' lives, even at the cost of self-preservation.
I'm pretty sure that there was a case before the Supreme Court (or other federal court?) back in the late 1980s, where shareholders of a firm sued for the firm to focus exclusively on profit, when the company had been taking a broader view of stakeholders (community, workers, etc.).
Reductionism is fine when a supermajority of available data paints the same picture, and that's what's happening here.
* Founders aren't trying to solve a problem, they're trying to grab table scraps from VCs and the already-wealthy to try and save their own skins. As a result, it's all about exit strategy, growth, and moat instead of business fundamentals and customer experience.
* VCs and their wealthy backers aren't looking for good business, they're looking for good profit. It's why they'll gladly invest into slop or outright grifts, and why they demand anything they invest into have an exit strategy (i.e., IPO) planned so they can cash out before the company collapses.
* Talent who wants to build a long-term career with a company - and accordingly focus on fixing its flaws, improving the customer experience, and saving expenditures - can't, because companies no longer fundamentally exist to provide long-term solutions and products, only short-term growth YoY. This ultimately ends up harming output and innovation, because why bother giving it your all when such efforts are counter to the "explosive growth" narrative and likely to get you PIPed?
* Retail investors and Business News are left feeding a monster that runs on Fairy Tales and ignorance, promoting big gains and huge losses rather than actual investing advice or corporate accountability.
It's all just a disgusting grift, is what I'm reducing it to, and I can't really fault Founders either since they're just trying to strike gold in an emptying mine shaft before it's closed off or collapses in. They're playing the game they think will net them safety and success...even though they may have better odds on some casino games instead.
And how these shareholders materialize. I don't think show up at guileless founder's workplace with guns and make them offer they can't refuse?
> but there’s a pretty huge throughline of outside investment and addiction engineering..
Personally I don't doubt that. But if people are taking outside money while being aware of its effects I don't know what kind of sympathy they deserve.
It can end up being a more circuitous path than you might expect.
For instance, I took investment in my business, about five years in, from a very ethically and strategically aligned individual, as we mutually saw an opportunity to do something good together.
His life took a left turn. Two kids and wife in a horrendous car crash, all left extremely disabled, enormous medical and emotional costs. After a year or so he had little option but to sell his holding in our business, and we allowed it, knowing that his situation had become dire. He sold to a small PE consortium, who again, looked pretty well aligned with what we were doing.
The consortium all then had a falling out, as one member had brokered a deal with a large PE group to be bought out. This ground on for another year or so, us on the sidelines, until eventually the large PE group managed a hostile takeover.
And that’s how we found ourselves with blackstone as our corporate overlords.
It all went to shit over the following years as we were forced to squeeze margins, cut R&D investment, and depart from our original mission to instead gouge our customers.
I ended up leaving, as going to bat for the dark side every morning was beyond corrosive for me, and while it was a pretty terrible financial decision, it saved my life.
The company grinds on, a thing utterly different to what I founded. I don’t ask for sympathy, just… perhaps awareness that taking any investment, no matter how benign, can take you places you’d never wish to go.
It can happen even without investment. I’ve seen businesses where cofounders have had to sell out due to poor health or similar, and the outcomes have ended up pretty much the same.
> Having spent a few years in the VC world I have been increasingly convinced outside investment is the biggest reason why companies lose their morals. The legal obligation to represent shareholders erodes morality.
Oh 1000%.
I once worked at a company where the founder had famously said many times that he would never take the company public. But then, he had a stroke. And within two years they had an IPO. Started doing what every other 'big company' did instead of their own thing. And from what I heard from folks on the inside, Enshittification happened pretty quick after I left.
The lack of addressing the loose ethics of 'Behavioral Psychologists' working in these fields, is TBH a bit of a stain on the whole profession.
While “maximizing shareholder value” is a huge problem, aren’t there other problems too? Founders wanting to get rich as quickly and as easily as possible, customers/users refusing to pay even for most important services (for example, how many people are willing to pay 5 bucks a month for something as important to modern life as email? But they’re happy to pay 5$ for a crappy Starbucks coffee), lawmakers too old or too corrupt to understand the negative effects of the products/markets they’re supposed to regulate, general public more interested in convenience and cheap entertainment than subjects like privacy, parents simply hooking their kids up with iPads so they don’t have to deal with tantrums (one of my colleagues told me he was raised by TV/internet, not by humans)… and on and on.
I suppose we’re living in an age of unchecked capitalism. But there are other issues too
“Shareholder value” is what turned “we’re a family here” into a joke and cliche. It turns people into lines on a spreadsheet and strips leadership of their ability to care or treat people as humans. It’s represents the very darkest side of capitalism. Im very much a capitalist but it doesn’t mean I have to ignore the realities of it, both good and bad. I’ll take it over all alternatives though as it actually works and improves the lot of society as a whole
For the last 5-10 years I've noticed a lot of people here are more willing to question VC as the sole or even ideal way to start a company, and since a major chunk of YC is to train how to raise money and connect people via demo day or mentors to VC, I think that marks how the HN community has departed from the YC community. Obviously there's a lot of overlap, and HN clearly has it's roots in YC by it's literal founder, but I think it's wrong to say HN community is the same as YC community, which I say "historically"
> Having spent a few years in the VC world I have been increasingly convinced outside investment is the biggest reason why companies lose their morals. The legal obligation to represent shareholders erodes morality. When the people running these companies feel they’re beholden to shareholders and can’t act on their own agency of course they will turn to addiction research not as a warning but as a guidebook.
As an outsider I don’t believe it. Morals? I don’t even see a nugget or trace of some elevated goal in all of these stories.
Shareholders or not, the companies have to make money. Now us users have been gaslit for years about us just being too stingy to “pay for the product”, therefore we “become the product”. But all of these gamification/social media platforms were made to be free. Obviously there had to be a path to monetization. Morals or not. And they all end up in the same place.
Duolingo was co-founded by the inventor of Captcha. One of the ideas was to use people as translators, similar to the Mechanical Turk idea of letting people do some chore and using the product. Anyway, they also monetized eventually. Now what has Duolingo actually done for langauge learning? According to many people now, nothing. Look on YouTube. People post about their streaks. I.e. the gamification. The last video I saw was barely about how Duolingo helped at all. They had the typical “of course you can’t use only Duolingo” and then they listed all the other approaches and techniques. Well, did Duolingo serve any role? They said repetition. Well the repetition is for very artificial and out of context words and phrases. That Duolingo learners are like fish out of water in a context where they have to apply their knowledge is a meme at this point.
Another fun, very SC thing[1] about DuoLingo is/was the volunteer community. Yes of course a volunteer community to boost the for-profit platform. That’s how you get Klingon.
The AI-fication, aggressive ads, and pay-to-streak (you can artificially pause a streak for a whole month apparently) has made people worry and complain. And not because they are making a good language learning app worse to use, even. It seems to be mostly that people are hooked to the streak and are now even more annoyed by the hoop they have to go through (the app itself) to maintain it.
So what did Duolingo (DL) achieve? It made people fret and worry about their streak. That’s it. I had a friend who was so glad that he was getting close to a one-year streak on DL. Why? Because then he could quit. I wrote like one or two sentences that I recalled in his target language. He didn’t understand it.
[1] See StackExchange. I remember Jeff Atwood’s very humble blog piece about how he made his millions. It was of course all him but he had a good upbringing and access to good schools of course. No mention of the employees, but that’s just normal capitalist things so that’s fine. But also no mention that he made a platform based on volunteer work. Hmm. Self-made man? In SC culture he is. Because getting users/fools to work for you for free is the ultimate disruption.
I think the problem is more fundamental than this: When your monetization model is tied to usage, then of course you will try to maximize usage, rather than user benefit. It can't be any other way if your reward function is tied to product usage.
Contrast with a car: Their monetization model does not depend on how much I drive it - as long as I find it useful enough to buy. Or a gym, where it actually runs in reverse - the gym makes more money when I use the product less, just so long as I don't leave.
Microsoft office or Mario Kart do not need me to be addicted - they just need me to buy the software. Even Photoshop with a subscription model doesn't pursue addiction strategies - why would they? Just make it useful enough for me to keep paying for it, and that's plenty good. Maybe it's actually closer to the gym in that sense.
Which products are the ones that require addiction?? The ones that are free to use but cost money to provide.
IOW - In many ways this is our fault for expecting social media and many other services to be provided to us for free, relying on ads to pay for it.
I suppose you could try to make a social media platform without dark patterns and charge a monthly fee for it, but how many people would pay for it? My guess is close enough to zero to ensure failure. But I tell you what - I'd probably pay for it myself. And I'd be very lonely.
I think you are correct, the root problem is that the targeted advertisement model is far more profitable than any paid model, thus outcompeting every sustainable alternative.
I personally think the solution is simple, yet fairly draconian and therefore hard to implement due to the inevitable political backlash: ban all targeted advertising. You can still run ads on digital platforms, but the outcome of the heuristic used to pick an ad must be independent of user derived data, including session data, ip address, time of day, country, past viewing history and so on.
This is completely wild to me. I honestly do most of my clothes shopping through Instagram/Facebook ads. I enjoy that targeted advertising shows me new products and companies that I'm interested in, often very niche stuff that I don't come across otherwise. I would so much rather see that than ads for life insurance, penis pills, ambulance chasers, or whatever other bullcrap goes to the lowest common denominator. The ads that get read on podcasts are a great example of this.
Founder of a social-media-adjacent startup here — 100% agree that monetization model, moreso than funding etc is the core problem.
The decisions for which I am most grateful my co-founders and I have made, from day one, were to 1) have a monetization model that's not reliant on usage and 2) not set goals against usage.
Granted, we're a bit of a peculiar case because of the market we serve (giving parents a screen-free alternative to smartphones and social media for their kids). But personally, my experience here has given me hope that other monetization models _can_ pave the way for non-addictive social products to flourish.
> I suppose you could try to make a social media platform without dark patterns and charge a monthly fee for it, but how many people would pay for it?
In 2022, mastodon.social was provisioned at a cost of 0.6EUR/year/user for 191k users [1]. This price is payable even by many people in poor countries. People would pay for something like this same as they pay for other stuff, assuming it was well designed and gave users power to do stuff.
And yet probably less alone than when using polluted and terrible social media.
I would pay, FWIW. I am actively looking for a decent community of humans online that isn’t run by selling data to AI farms or trying to get my eyeballs all the time. Unfortunately social media ate many of the places I previously used to call home.
As long as the founders aren't looking to make billions, it's very possible to run a healthy social media platform, as evidenced by Front Porch Forum [1]. 20 employees, human moderators (gasp)! There's also Metafilter which is paid [2].
Old school specialty sites are still around, with topics, categories, and discussions around the whole site emphasis.
As someone who likes to grow a little food in a semi-rural area, I enjoy permies.com - every day, a volunteer posts a new question or reposts a relevant topic, depending on the season or recent interest or whatever.
But they're not trying to make a billion dollars. Or even a million dollars.
That's why I like it. To raise funds, they sell books, playing cards, instructional videos. With non-invasive "tiny ads" which they self-parody.
Small is beautiful. The current internet is ruled by evil reptiles seeking to rip off your time, your data, your privacy, your friends... "Don't be evil" is dead and gone.
Turn back the clock 30 years. I did. And I'm happy.
This may be a misinterpretation tangent, but I play tennis and do a bit of inline skating, and I find one of the benefits is it provides a grounding to the real, physical world; time away from the constant feed of new shit on the internet. I also get in-person human interaction, which is an additional grounding effect. I've made plenty of friends as a result of both activities, and these friends cover a wide spectrum of personalities and backgrounds and life experiences.
This isn't necessarily turning the clock back 30 years, it's just finding some (of the plenty of) other activities I can enjoy that don't require a screen.
Additionally, for both of these activities, if your mind is elsewhere you can't do it. You have to be 'present'. Tennis is technically difficult to play proper shots (and I'm not particularly good at it, I enjoy the challenge of getting better) and inline skating, well, if you take your mind / eyes off your environment for a second you're putting your bodily integrity at risk. Having that 'presence' or singular focus is also grounding. It clears a lot of the other shit that builds up.
And, not that I feel this viscerally, there's no manipulation of my intent around my activity: I don't get derailed onto a track I wasn't intending to follow.
Midunderstanding tangent, I don't think so. Arnold says to get off the phone, get out into the real world. Totally aligned with what you are saying.
I signed up for the gym, got my partner to do the same, sought out and found some good volunteer work where I was needed. Too much screen time is not good, but old school newsletters that are relevant work just fine. They always have. Be the change you want to see, all that mumbo jumbo can actually work. Sure community can be the catalyst.
looks good. old school discussion sites were just fine. The larger corporations are big scams, ripping off your personal details, your relationships, your photo library, and who knows what else, and up to 99% of users have no clue. Nothing to be gained, everything to lose.
Even facebook emojis can be entered into the record in a court of law during a divorce proceeding. A fleeting moment of trying to make someone feel better, or more likely, to get a thumbs up, becomes a permanent electronic record completely removed from fleeting circumstances. That nonsense is potentially very dangerous
Going to recommend "Addiction by Design" here. Superb book about the addiction design dynamics in the gambling industry and very reminiscent of what we see in the smartphone/internet universe today. Shout out to the forgotten HN user who recommended it originally, one of the best and most salient books I've read in years.
This reminds me of my borderline exhausting quest to build a wiki for golf that isn’t extractive like most golf sites.
Trying to bootstrap it without any funding is a lot, but necessary, and I have to run it on a shoestring. The frustrating part is that with all networks the flywheel is everything. Once you get the product on people’s phones, the value is easy to see, but to get the app in their phones, you need a bunch of money to create value to get people there.
This is why the VC funding is so pernicious and why projects like mastodon, lemmy, and pixelfed are so difficult to get off the ground. The point is almost always the network itself more than the product.
I’ll keep trying to just do it slow and steady, even if it takes me a decade. I honestly don't care if I fail because I know the people out there that care about golf course architecture just want a place to talk about the courses they love.
I was talking with a friend who is a camp counselor for a small summer camp the other day and they said that 4 of the 35 or so kids at the camp left because they couldn’t be away from their devices.
This power intermittent reinforcement in the on-ramp of addiction is scary powerful.
Do we have any ways to innoculate ourselves and the future generations against it?
The author poses changing the game which is support. I guess the trendy “dopamine fast” is a tool against this or weekly screen free time. Maybe more education on intermittent reinforcement or a D.A.R.E-like program for apps (a this one is a little tongue-in-cheek, but not really).
With technological products in particular—where an idiosyncratic nerd with an old computer under the desk can run a vibrant forum, a couple of plucky young “cofounders” can conjure a company from nothing, and HN (at least at one point [0]) can sway the entire tech culture from a single process on a single server—isn’t it an option to… not grow?
I guess the LLM era makes credible products more capital-intensive than they used to be, but even so, the vendors are pricing their stuff aggressively, and even when they try to squeeze the prices later, half these foundation models that are better-than-last-year’s-SOTA are open-source!
If you want to play with lots of money and seek out lots of money, there’s lots of money swirling around seeking to involve you in that game. But if you just want to make something nice and human-scale and small, what better time than now?
The path to billions of bucks may require mercenary bucks-extracting behavior, but that’s not the same as a growth imperative being an inevitable force of nature.
I can’t help but feel like the Small Web folks are on to something.
> Regulated Algorithms: We regulate tobacco companies because their products are addictive and harmful. Algorithmic transparency or giving users control could preserve the benefits while reducing the addictive design patterns. The EU’s Digital Services Act already requires algorithmic transparency from large platforms.
You effectively need or greatly benefit from gas, water, electricity and an ISP.
What do you really get out of social media? I mean other than most of you getting crippling anxieties about things that aren’t even real, of course.
Sure sure, I know, everyone wants it because they need to share photos of the kiddos with grandma out of country. No one needs it because they enjoy the shallow bullshit and dopamine and snarky retorts that enforce their ideology.
So the master plan is to let governments (known for tech illiteracy and 20-year procurement cycles) regulate hyper-evolving social media platforms?
Why teach people to think critically or resist engineered dopamine traps when we can have a bunch of career bureaucrats draft laws while using Wordpad or Internet Explorer to Google “AI” xD
Regulation doesn't have to be at the level of controlling how technology is designed. It can be more creative, at the level of organizations or incentives, for example:
- Require advertising companies to follow special rules, including only doing advertising and nothing else
- Fund an agency that measures the health harms of large platforms and imposes fines or restrictions based on harm
Readit News
Having spent a few years in the VC world I have been increasingly convinced outside investment is the biggest reason why companies lose their morals. The legal obligation to represent shareholders erodes morality. When the people running these companies feel they’re beholden to shareholders and can’t act on their own agency of course they will turn to addiction research not as a warning but as a guidebook. It’s Stanford Prison Experiment stuff.
I hate being reductionist, and I am posting this on a historically YC forum so of course there’s nuance, but there’s a pretty huge throughline of outside investment and addiction engineering. It sucks we’re seeing less grants and less security net to encourage risks under current administration, because it leaves investment as the quickest path to starting or scaling a company. Donate to open source, IMO
When we have that mindset, we absolutely don't care about the thing that we call "our product." It's just food for the actual product, where we want to fatten it up, and sell it to the biggest slaughterhouse.
That starts almost immediately. You can't even get an A round, without an "exit plan."
I feel that the very existence of an exit plan, dooms the user. No one cares about them. It's all about fattening the company, and making it look good. When we do that, we'll feed it nothing but junk food, in an effort to make it as fat as possible, as quickly as possible, with absolutely no thought as to long-term viability.
I would love to see the tech industry return to concentrating on truly delivering good to the end-user. It's still possible to make a decent living, but maybe not at the insane rates we see.
Side note, on "exit plan" - the most ridiculous thing about raising money is you need an exit strategy but you cannot explicitly say you have an exit strategy, you have to imply it while the whole time pretending it's not a focus for you. It's a very weird dynamic.
If you've ever dealt with Investor Relations at a public company, this becomes very apparent very quick.
Core fundamentals as a business can be strong, but if you cannot craft a unique story or thesis (which does not have to be tangentially related with active initiatives) about your company, you will not succeed.
Usually, the onus should fall on PM, EMs, and Sales Leadedship to drive customer outcomes, but the hyperfocus on short term deliverables AT THE EXPENSE of a long term product vision makes it difficult to push back.
Very few newly founded or public companies can do the latter - the most recent ones I can think of are maybe Datadog and Wiz (not public but they did drive a customer centric mentality internally).
Of course, a lot of this is also due to the extreme bloat that formed in the tech industry in the late 2010s to early 2020s. Teams grew unrealistically large with limited financial justification beyond cherry-picked growth metrics, and this meant a lot of companies lost the ability to innovate frugally or nimbly. Unrealistically high valuations also played a role because towards the end, founders could end up demanding IPO-sized multiples in private markets even without the underlying fundamentals (eg. Lacework's $9 BILLION valuation on what was at most $90 MILLION in revenue).
A lot of the current AI products and stories are cost-competitive due to that bloat itself, so some amount of rightsizing will help the industry.
As Action Jack Barker said, Pied Piper's product is its stock.
Really does make me cynical on investing...
How do you force an industry to ignore profit incentive? Seems a little pollyannish to hope for.
We actually need to combat this notion that somehow exclusive focus on short term returns is somehow legally, morally, or ethically required. It is actually antisocial and obviously destructive.
I say this because you used the phrase "fiduciary duty" which does not exist in this context.
If you hit the growth targets, they will pat you in the back and will demand Hyperscale growth growth growth and will throw money at you to supercharge it.
If you refuse to chase the growth, they will simply kick you off the company via Board or fund your competitor that will chase the growth at all means
In 95% of cases, the founder isn't smashing moral barriers because the VCs and shareholders are making them, or lording the threat of legal action or any some such.
In 95% of cases, the founder is smashing through moral barriers because their interests are aligned with the VCs: because they think what they are doing will lead to stupendous mega-wealth for them personally.
Like sure, I think the idea that corporate execs must be beholden to maximizing share price is a) corrosive to our society and b) not as true as often portrayed, but I don't think that's even a real factor here.
Legally maybe. The market and shareholders will punish you if you deviate from the current standard behavior.
We’ve all seen companies do layoffs just because “Wall Street” was concerned about the economy and then instantly see the stock price spike up.
These negative consequences are all results of bog standard prisoner dilemma issues that need government regulation to make sure everyone picks the good square, but the tech industry and this boards community as well is allergic to the idea that regulations can improve the situation for everyone
And even if what you said is true, you can look at the results of years of this system, the difference between companies with outside investment vs without makes a strong case against what you're saying.
It's like saying educating people about their rights wrt police helps, but in practice police don't derive their power from actual laws and it comes at considerable personal expense to push it to courts, in the same way Delaware is very strongly biased towards shareholder rights.
That may be true legally, but practically it's only true if they control the board. Otherwise they will simply be replaced by people who are willing to do what the board wants.
Individual investors are largely operating on trust.
Dead Comment
This "legal obligation" is an internet rumor that does not exist in the real world. Yes, if your company has competing buyout offers of $1m and $2m and the board takes the $1m offer because they received a bribe, it will come up. Otherwise, it never does.
The proof is in the pudding (please go find me even one case where shareholders have successfully imposed their will on a board or executives because of this obligation), but it doesn't even logically make sense. Other than the buyout example, it's hard to think of almost any action a company could take that doesn't have some justification that it is for the benefit of shareholders. i.e. if we make our app too addictive, we risk social backlash and regulatory intervention by governments which will hurt out shareholders. And that's all that is needed, because there is no associated time frame with this obligation.
To be clear, boards and executives might strive to please investors, but it is not based on a legal obligation. An executive that ignores the interests of shareholders might be concerned about their reputation as a capable entrepreneur, risk losing their job, or devalue their own shares, but they are no in legal jeopardy.
Look at Mozila for the most insidious example. Take a privacy focused product. Rope in a bunch of suckers. Then literally delete the privacy focus from your mission statment and start the "slaughter"
Craiglist is proof it can be done at scale.. Its just that so few people with them means and morality exist anymore. The Sodom and Gomorrah fable is a warning not to let this happen or your society will destroy itself.
I don't think this is a good example. Back then, the internet was a new thing only a small cohort of people cared about. Something small could just stay small because none of the big players with money cared. Nowadays, if someone wanted to start something like Craigslist, they would be outrun by someone else going the VC route before the small company could get big enough on its own. I think it boils down to the difference between slower growth, boot-strapped companies vs. VC-backed.
Early in a nascent industry, you focus on the core product. You bring scale and scope economies. You make the supply chain more efficient. You improve the logistics. More abundant basic food stuffs for everyone, and more profits for agriculture shareholders. A true win-win.
Later on when the industry matures, the easy wins are all gone. Logistics and agriculture is fully optimized. The only scope for improvement is in marketing, adding sweeteners, and cutting out expensive ingredients. Now it's a lose-win, but from the shareholders perspective only, it's a win.
The problem is, you can't just ask companies to act nicely. While that would be a good start, even if they genuinely wanted to, competition largely forces their hand. The solution is careful and minimal regulation, to deter the pathological late-stage optimizations.
Deleted Comment
Just a heads up, the experiment was complete fraud and could never be replicated.[1]
I agree with you that outside investment can work as a strong accelerator for these things. It enables founders to externalize responsibility.
However, it is not the main reason. Exploitative companies have existed long before venture capital was invented. In the end every company exists to make money and so is inherently immoral. That is why the state is needed to regulate the market so companies don't hurt society too much.
Those founders didn't get corrupted by evil venture capital, they didn't have that strong of a morality to begin with.
[1] https://www.vox.com/2018/6/13/17449118/stanford-prison-exper...
Show me the incentive, and I'll show you the outcome - Charlie Munger
It's the same with politics and money.
We don't get the leaders we want, because it costs money to buy people's attention. We get the people who have some way to pay for attention
(in recent years, one of those ways is increasingly corruption - e.g. senator of NJ, mayor of NY, etc.)
An article today talks about Cuomo following the "local TV buys" playbook, which WAS a fairly reliable way to win elections:
https://www.nytimes.com/2025/06/28/opinion/ezra-klein-show-c...
That didn't work this time, but the mechanism is simple and clear
Who watches local TV anymore? Probably not many people under 60.
Either with a guy promising Mars while siegheiling or jeopardizing teens’ health or ruining the Earth. All that matters is the valuation.
And why not? Investors never get into trouble for the mess their investments cause. Worst-case scenario, they lose their investment.
In Magickal Faerieland, we have regulations to align those 2 things by incentivizing the "goodguy" path and/or disincentivizing the "cackling villain" path but we live in reality where money rules and regulatory capture is a thing. So a Facebook or other megacorp can get away with using neuroscience and psychology to engineer a virtual slot machine with a terrible payout and ExxonMobile et al can get away with being an architect of environmental degradation and the accompanying humanitarian disasters.
https://open.substack.com/pub/vonnik/p/how-to-take-your-brai...
Yes, the addictions are engineered in the service of shareholder value. There are many ways to fight it!
Fwiw, this dynamic goes way beyond VC and tech.
Douglas Courtwright writes about this in Age of Addiction:
https://www.amazon.com/The-Age-of-Addiction-audiobook/dp/B07...
If people actually believed in something they'd make it open source or a non-profit, not a convenient vehicle for personal enrichment. Imagine if Wikipedia was a for-profit startup, it would've eventually ended up as an unusable cesspool of advertising.
If you don’t play this game you’ll lose. Look at Europe for example, they haven’t played the VC game properly and thus have no really significant tech player compared to the US / China.
So what options are left? Play the game or be ruled by those that play it.
I’d rather play even if moral erosion is required.
Gross.
Engineering addiction is also probably more often than not intentional. When all the business metrics/KPIs are stuff like "engagement time", "$ spent", even AB testing of random features leads to manufacturing addiction
I'm pretty sure that there was a case before the Supreme Court (or other federal court?) back in the late 1980s, where shareholders of a firm sued for the firm to focus exclusively on profit, when the company had been taking a broader view of stakeholders (community, workers, etc.).
* Founders aren't trying to solve a problem, they're trying to grab table scraps from VCs and the already-wealthy to try and save their own skins. As a result, it's all about exit strategy, growth, and moat instead of business fundamentals and customer experience.
* VCs and their wealthy backers aren't looking for good business, they're looking for good profit. It's why they'll gladly invest into slop or outright grifts, and why they demand anything they invest into have an exit strategy (i.e., IPO) planned so they can cash out before the company collapses.
* Talent who wants to build a long-term career with a company - and accordingly focus on fixing its flaws, improving the customer experience, and saving expenditures - can't, because companies no longer fundamentally exist to provide long-term solutions and products, only short-term growth YoY. This ultimately ends up harming output and innovation, because why bother giving it your all when such efforts are counter to the "explosive growth" narrative and likely to get you PIPed?
* Retail investors and Business News are left feeding a monster that runs on Fairy Tales and ignorance, promoting big gains and huge losses rather than actual investing advice or corporate accountability.
It's all just a disgusting grift, is what I'm reducing it to, and I can't really fault Founders either since they're just trying to strike gold in an emptying mine shaft before it's closed off or collapses in. They're playing the game they think will net them safety and success...even though they may have better odds on some casino games instead.
https://wonderful.dev/download
> but there’s a pretty huge throughline of outside investment and addiction engineering..
Personally I don't doubt that. But if people are taking outside money while being aware of its effects I don't know what kind of sympathy they deserve.
For instance, I took investment in my business, about five years in, from a very ethically and strategically aligned individual, as we mutually saw an opportunity to do something good together.
His life took a left turn. Two kids and wife in a horrendous car crash, all left extremely disabled, enormous medical and emotional costs. After a year or so he had little option but to sell his holding in our business, and we allowed it, knowing that his situation had become dire. He sold to a small PE consortium, who again, looked pretty well aligned with what we were doing.
The consortium all then had a falling out, as one member had brokered a deal with a large PE group to be bought out. This ground on for another year or so, us on the sidelines, until eventually the large PE group managed a hostile takeover.
And that’s how we found ourselves with blackstone as our corporate overlords.
It all went to shit over the following years as we were forced to squeeze margins, cut R&D investment, and depart from our original mission to instead gouge our customers.
I ended up leaving, as going to bat for the dark side every morning was beyond corrosive for me, and while it was a pretty terrible financial decision, it saved my life.
The company grinds on, a thing utterly different to what I founded. I don’t ask for sympathy, just… perhaps awareness that taking any investment, no matter how benign, can take you places you’d never wish to go.
It can happen even without investment. I’ve seen businesses where cofounders have had to sell out due to poor health or similar, and the outcomes have ended up pretty much the same.
Oh 1000%.
I once worked at a company where the founder had famously said many times that he would never take the company public. But then, he had a stroke. And within two years they had an IPO. Started doing what every other 'big company' did instead of their own thing. And from what I heard from folks on the inside, Enshittification happened pretty quick after I left.
The lack of addressing the loose ethics of 'Behavioral Psychologists' working in these fields, is TBH a bit of a stain on the whole profession.
I suppose we’re living in an age of unchecked capitalism. But there are other issues too
If you construct your business model so that revenue is derived from attention, then your business will become a machine for consuming attention.
I admit I don’t really know the cause and effect dynamic here. Is that what makes VC’s successful, or the reverse?
As an outsider I don’t believe it. Morals? I don’t even see a nugget or trace of some elevated goal in all of these stories.
Shareholders or not, the companies have to make money. Now us users have been gaslit for years about us just being too stingy to “pay for the product”, therefore we “become the product”. But all of these gamification/social media platforms were made to be free. Obviously there had to be a path to monetization. Morals or not. And they all end up in the same place.
Duolingo was co-founded by the inventor of Captcha. One of the ideas was to use people as translators, similar to the Mechanical Turk idea of letting people do some chore and using the product. Anyway, they also monetized eventually. Now what has Duolingo actually done for langauge learning? According to many people now, nothing. Look on YouTube. People post about their streaks. I.e. the gamification. The last video I saw was barely about how Duolingo helped at all. They had the typical “of course you can’t use only Duolingo” and then they listed all the other approaches and techniques. Well, did Duolingo serve any role? They said repetition. Well the repetition is for very artificial and out of context words and phrases. That Duolingo learners are like fish out of water in a context where they have to apply their knowledge is a meme at this point.
Another fun, very SC thing[1] about DuoLingo is/was the volunteer community. Yes of course a volunteer community to boost the for-profit platform. That’s how you get Klingon.
The AI-fication, aggressive ads, and pay-to-streak (you can artificially pause a streak for a whole month apparently) has made people worry and complain. And not because they are making a good language learning app worse to use, even. It seems to be mostly that people are hooked to the streak and are now even more annoyed by the hoop they have to go through (the app itself) to maintain it.
So what did Duolingo (DL) achieve? It made people fret and worry about their streak. That’s it. I had a friend who was so glad that he was getting close to a one-year streak on DL. Why? Because then he could quit. I wrote like one or two sentences that I recalled in his target language. He didn’t understand it.
[1] See StackExchange. I remember Jeff Atwood’s very humble blog piece about how he made his millions. It was of course all him but he had a good upbringing and access to good schools of course. No mention of the employees, but that’s just normal capitalist things so that’s fine. But also no mention that he made a platform based on volunteer work. Hmm. Self-made man? In SC culture he is. Because getting users/fools to work for you for free is the ultimate disruption.
Dead Comment
Contrast with a car: Their monetization model does not depend on how much I drive it - as long as I find it useful enough to buy. Or a gym, where it actually runs in reverse - the gym makes more money when I use the product less, just so long as I don't leave.
Microsoft office or Mario Kart do not need me to be addicted - they just need me to buy the software. Even Photoshop with a subscription model doesn't pursue addiction strategies - why would they? Just make it useful enough for me to keep paying for it, and that's plenty good. Maybe it's actually closer to the gym in that sense.
Which products are the ones that require addiction?? The ones that are free to use but cost money to provide.
IOW - In many ways this is our fault for expecting social media and many other services to be provided to us for free, relying on ads to pay for it.
I suppose you could try to make a social media platform without dark patterns and charge a monthly fee for it, but how many people would pay for it? My guess is close enough to zero to ensure failure. But I tell you what - I'd probably pay for it myself. And I'd be very lonely.
Edit: Replaced all-caps with italics.
I personally think the solution is simple, yet fairly draconian and therefore hard to implement due to the inevitable political backlash: ban all targeted advertising. You can still run ads on digital platforms, but the outcome of the heuristic used to pick an ad must be independent of user derived data, including session data, ip address, time of day, country, past viewing history and so on.
We need to educate friends and family about ads, help them understand the harms, give them tools to avoid them.
No one should be browsing the internet without an ad blocker in 2025, certainly no one we love.
The decisions for which I am most grateful my co-founders and I have made, from day one, were to 1) have a monetization model that's not reliant on usage and 2) not set goals against usage.
Granted, we're a bit of a peculiar case because of the market we serve (giving parents a screen-free alternative to smartphones and social media for their kids). But personally, my experience here has given me hope that other monetization models _can_ pave the way for non-addictive social products to flourish.
In 2022, mastodon.social was provisioned at a cost of 0.6EUR/year/user for 191k users [1]. This price is payable even by many people in poor countries. People would pay for something like this same as they pay for other stuff, assuming it was well designed and gave users power to do stuff.
[1] https://news.ycombinator.com/item?id=38117385
I would pay, FWIW. I am actively looking for a decent community of humans online that isn’t run by selling data to AI farms or trying to get my eyeballs all the time. Unfortunately social media ate many of the places I previously used to call home.
Dead Comment
[1] https://www.washingtonpost.com/technology/2024/08/10/front-p...
[2] https://www.metafilter.com/
That's…surprisingly cheap. Which reminds me that I keep meaning to set up an SDF or tildeverse account.
[1] https://www.metafilter.com/faq.mefi#1
Old school specialty sites are still around, with topics, categories, and discussions around the whole site emphasis.
As someone who likes to grow a little food in a semi-rural area, I enjoy permies.com - every day, a volunteer posts a new question or reposts a relevant topic, depending on the season or recent interest or whatever.
But they're not trying to make a billion dollars. Or even a million dollars.
That's why I like it. To raise funds, they sell books, playing cards, instructional videos. With non-invasive "tiny ads" which they self-parody.
Small is beautiful. The current internet is ruled by evil reptiles seeking to rip off your time, your data, your privacy, your friends... "Don't be evil" is dead and gone.
Turn back the clock 30 years. I did. And I'm happy.
This isn't necessarily turning the clock back 30 years, it's just finding some (of the plenty of) other activities I can enjoy that don't require a screen.
Additionally, for both of these activities, if your mind is elsewhere you can't do it. You have to be 'present'. Tennis is technically difficult to play proper shots (and I'm not particularly good at it, I enjoy the challenge of getting better) and inline skating, well, if you take your mind / eyes off your environment for a second you're putting your bodily integrity at risk. Having that 'presence' or singular focus is also grounding. It clears a lot of the other shit that builds up.
And, not that I feel this viscerally, there's no manipulation of my intent around my activity: I don't get derailed onto a track I wasn't intending to follow.
Midunderstanding tangent, I don't think so. Arnold says to get off the phone, get out into the real world. Totally aligned with what you are saying.
I signed up for the gym, got my partner to do the same, sought out and found some good volunteer work where I was needed. Too much screen time is not good, but old school newsletters that are relevant work just fine. They always have. Be the change you want to see, all that mumbo jumbo can actually work. Sure community can be the catalyst.
"i want to help people connect!!! but i gave up when i noticed i wasnt gonna get easy money"
then you dont wanna help people..
Money can be like crack and big tech has plenty of addicts
Even facebook emojis can be entered into the record in a court of law during a divorce proceeding. A fleeting moment of trying to make someone feel better, or more likely, to get a thumbs up, becomes a permanent electronic record completely removed from fleeting circumstances. That nonsense is potentially very dangerous
Trying to bootstrap it without any funding is a lot, but necessary, and I have to run it on a shoestring. The frustrating part is that with all networks the flywheel is everything. Once you get the product on people’s phones, the value is easy to see, but to get the app in their phones, you need a bunch of money to create value to get people there.
This is why the VC funding is so pernicious and why projects like mastodon, lemmy, and pixelfed are so difficult to get off the ground. The point is almost always the network itself more than the product.
I’ll keep trying to just do it slow and steady, even if it takes me a decade. I honestly don't care if I fail because I know the people out there that care about golf course architecture just want a place to talk about the courses they love.
https://golfcourse.wiki
Aside from the occasional 503 error (again, I'm trying to get as much as possible out of the cheapest plan), it works pretty well.
This power intermittent reinforcement in the on-ramp of addiction is scary powerful.
Do we have any ways to innoculate ourselves and the future generations against it?
The author poses changing the game which is support. I guess the trendy “dopamine fast” is a tool against this or weekly screen free time. Maybe more education on intermittent reinforcement or a D.A.R.E-like program for apps (a this one is a little tongue-in-cheek, but not really).
Wow that’s scary. Such powerful addiction at such a young age
I guess the LLM era makes credible products more capital-intensive than they used to be, but even so, the vendors are pricing their stuff aggressively, and even when they try to squeeze the prices later, half these foundation models that are better-than-last-year’s-SOTA are open-source!
If you want to play with lots of money and seek out lots of money, there’s lots of money swirling around seeking to involve you in that game. But if you just want to make something nice and human-scale and small, what better time than now?
The path to billions of bucks may require mercenary bucks-extracting behavior, but that’s not the same as a growth imperative being an inevitable force of nature.
I can’t help but feel like the Small Web folks are on to something.
[0] https://news.ycombinator.com/item?id=5229522
> Regulated Algorithms: We regulate tobacco companies because their products are addictive and harmful. Algorithmic transparency or giving users control could preserve the benefits while reducing the addictive design patterns. The EU’s Digital Services Act already requires algorithmic transparency from large platforms.
What do you really get out of social media? I mean other than most of you getting crippling anxieties about things that aren’t even real, of course.
Sure sure, I know, everyone wants it because they need to share photos of the kiddos with grandma out of country. No one needs it because they enjoy the shallow bullshit and dopamine and snarky retorts that enforce their ideology.
- Require advertising companies to follow special rules, including only doing advertising and nothing else
- Fund an agency that measures the health harms of large platforms and imposes fines or restrictions based on harm