npub1tj54dz997wrdyqgf8sc36z3upy3ld0ujmwqyx42dtqxcwc7l68fqlx5ry2 (npub1tj5…5ry2) Well that's the point - they may be making a lot of *revenue* but that doesn't mean a lot of *profit*.
Many of these businesses are expensive to run, they've always struggled to be profitable, and they've mostly been feasting on VC money all this time (Spotify and Uber are just two popular examples of companies that have probably struggled to be profitable since they've been around).
Until recently it wasn't a big deal - for 15-20 years VCs were happy to splurge around money - the goal wasn't much to seek profitability but to seek market dominance (or at least the highest possible shares), under the assumption that profits would have arrived once market consolidation was reached.
We're almost two decades down the line, Spotify dominates the area of music streaming, Uber that of ride-hailing apps, but most of those companies still struggle to be profitable.
But now the VCs are starting to ask where's their money.
That's why the mass layoffs happened earlier this year, and that's why companies have become more aggressive with monetization - either by sharing user data more aggressively, or fighting ad-blockers, or cracking down on unofficial clients, or locking up their APIs, or coming up with absurd licensing models, or wrapping everything into subscriptions, or charging for things that everybody took as granted.
It's not a coincidence that so many businesses this year underwent such a synchronized and profound enshittification process, all while laying off big chunks of their stuff. It's basically their way of screaming "the cow has run out of milk, we haven't thought of how to build a sustainable business model in all these years, and now they're asking us to do it within a few months".
Fabio Manganiello /
npub1v7…ukv0u
2023-09-20 21:18:56
in reply to nevent1q…6ex0
Author Public Key
npub1v78mmuz20p6qd6nve30axhqu74avwn4f6z4grhug7755rat7wh3syukv0uPublished at
2023-09-20 21:18:56Event JSON
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"content": "nostr:npub1tj54dz997wrdyqgf8sc36z3upy3ld0ujmwqyx42dtqxcwc7l68fqlx5ry2 Well that's the point - they may be making a lot of *revenue* but that doesn't mean a lot of *profit*.\n\nMany of these businesses are expensive to run, they've always struggled to be profitable, and they've mostly been feasting on VC money all this time (Spotify and Uber are just two popular examples of companies that have probably struggled to be profitable since they've been around).\n\nUntil recently it wasn't a big deal - for 15-20 years VCs were happy to splurge around money - the goal wasn't much to seek profitability but to seek market dominance (or at least the highest possible shares), under the assumption that profits would have arrived once market consolidation was reached.\n\nWe're almost two decades down the line, Spotify dominates the area of music streaming, Uber that of ride-hailing apps, but most of those companies still struggle to be profitable.\n\nBut now the VCs are starting to ask where's their money.\n\nThat's why the mass layoffs happened earlier this year, and that's why companies have become more aggressive with monetization - either by sharing user data more aggressively, or fighting ad-blockers, or cracking down on unofficial clients, or locking up their APIs, or coming up with absurd licensing models, or wrapping everything into subscriptions, or charging for things that everybody took as granted.\n\nIt's not a coincidence that so many businesses this year underwent such a synchronized and profound enshittification process, all while laying off big chunks of their stuff. It's basically their way of screaming \"the cow has run out of milk, we haven't thought of how to build a sustainable business model in all these years, and now they're asking us to do it within a few months\".",
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