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All the oxygen trapped in a bubble

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Re: All the oxygen trapped in a bubble

#51

Post by ahlatimer »

potatolicious wrote: post #14
zackzackzack wrote: post #9

It's a shame that all of that talent is working on things the author doesn't think are worthwhile. I mean, everyone should work on what everyone can agree on is worth their time, right? Yet, I don't think everybody can really agree on what is worthwhile for a person's time. I can point at people working on things like Linux and Khan Academy and say "Their efforts are worthwhile!" but then Microsoft and that one guy,…

> "It's a shame that all of that talent is working on things the author doesn't think are worthwhile." That's an unfair statement - I think more importantly the bubble is making people work on things that they themselves do not believe are worthwhile. You have more and more people entering the market working on things because they think it will flip for ${MAX_INT}, not working on products they genuinely believe peopl…

> You have more and more people entering the market working on things because they think it will flip for ${MAX_INT}, not working on products they genuinely believe people want, or will pay for.

Do you have any actual examples of this happening?

I'm not saying there aren't people starting companies because they want to get rich, but I don't think it's happening in the droves that people make it seem like it is. I'm as pessimistic about the whole SV culture as they come, to the point of moving away in two weeks, but even I can't say I've met many, if any, people who seemed to be generally disinterested in what they were building, only doing it because they thought they could flip it.

Re: All the oxygen trapped in a bubble

#52

Post by hkarthik »

richcollins wrote: post #31
pg wrote: post #24

The pieces of this argument fit together very neatly, but the problem is that they don't correspond to reality. E.g. the cloud about increased VC fundraising. In reality VCs are having a hard time fundraising: http://nvcaccess.nvca.org/index.php/topics/research-and-tren... Thus it also isn't true that the cause of higher valuations is that VCs have more money. Valuations are certainly higher, but I think the reason i…

Where is the money that's driving increased developer/designer demand coming from?

It's the same money as before, but it's just being distributed towards higher salaries for developers/designs because the other infrastructure costs of starting a company have come down so much.

Even with the salaries being 20-40% higher, the initial costs for a startup are still at a historically low level, so more startups are being funded. As more players enter the ecosystem, they start competing for talent, hence driving the wages up even further.

Re: All the oxygen trapped in a bubble

#53

Post by johndavidback »

will_work4tears wrote: post #22

I don't have anything really substantial to add to this topic, but I find it interesting I have some serious envy for the "talent" that is so in demand. I went the easy route, chose the web development path in my education, rather than a more math heavy, software engineering direction. I've been slapping myself for years now, but this just rubs salt in my wounds. Granted, I interview very poorly, am not the most arti…

There is still a high demand for talented web developers... You don't need a PhD in computer science to work for a startup. There's a lot of money to be made working on teams building MVP's.

Re: All the oxygen trapped in a bubble

#54

Post by trotsky »

pg wrote: post #24

The pieces of this argument fit together very neatly, but the problem is that they don't correspond to reality. E.g. the cloud about increased VC fundraising. In reality VCs are having a hard time fundraising: http://nvcaccess.nvca.org/index.php/topics/research-and-tren... Thus it also isn't true that the cause of higher valuations is that VCs have more money. Valuations are certainly higher, but I think the reason i…

With $2MM and $4MM seed rounds from "angels" doesn't it make sense to lump that money in with VC fundraising if you're looking for a benchmark of investment dollars? A lot more of that money used to take the form of LPs.

Re: All the oxygen trapped in a bubble

#56

Post by endlessvoid94 »

> Rapidly increasing demand for an only steadily increasing supply. Thus, inflation.

I think it might be possible to rapidly increase the supply. I'm working on Bloc (http://bloc.io) and have been privileged enough to hang out at dev bootcamp (http://devbootcamp.com), and if I've learned anything, it's that people want to fill this supply.

The challenge is taking the lessons we've learned and scaling them up to meet something like an economic demand.

I don't think it's impossible.

Re: All the oxygen trapped in a bubble

#57

Post by ForrestN »

pg wrote: post #44
ForrestN wrote: post #30

Earlier quoted context omitted.

Clearly there isn't just one reason, right? Can't all of these factors, and others, be contributing? I don't claim to know who's right, or how to weight the various factors, but big exits certainly do free up capital to be reinvested in more companies, don't they? I'm curious in a broader sense what you (or anyone else who is experiencing it first hand) makes of the "bubble question." I'm sure it's unlikely but it wo…

No, the capital returned to a VC fund after an exit is not reinvested. It's distributed to the LPs. And while yes, strictly speaking, the LPs now have more money to invest than they had before, they are mostly giant endowments, pension funds, and foundations who only have a small fraction of their assets in VC funds, and whose future investment decisions are decided by asset allocation policies and not by recent retu…

Thanks! That makes sense. I just hear so many names of individuals being associated with these windfalls it's easy to imagine them continuing to invest on the basis of their holdings being liquidated.

Re: All the oxygen trapped in a bubble

#58

Post by bluedanieru »

What about "creative destruction?" Part of the process is resources being diverted to shit that goes nowhere. Eventually the people who made that shit go out of business and then go to work on something else (and hopefully for them, this time, it doesn't suck).

I suspect the author's point is that lately there is much more destruction and less creativity, but he doesn't state it explicitly or even do a very good job of implying it. In fact, this almost reads like a critique of basic capitalism. Certainly the ratio of expensive but worthless shit to good and useful stuff seems headed up. I agree that it is. However the boom-bust cycle is a feature of capitalism, not something you set about to correct. The author doesn't propose any solution here, which is convenient. If he had, he would have come to the sudden realization: Aha! There isn't one.

Is Instagram worth $1B? Definitely not. But neither is Facebook worth $100B, or whatever made-up number they're valued at these days. Evaluating the value of ideas is not an easy task. Capitalism arrives at a solution eventually, but no one ever said it was efficient about it.

(Okay, lots of people say that, but they're deluded assholes.)

Re: All the oxygen trapped in a bubble

#59

Post by damoncali »

tferris wrote: post #12

> All those smart and talented heads, and all those benjamins, didn’t progress the economic base in a way we’re going to care about tomorrow. He's talking of Facebook, Instagram, Pinterest, etc. and doesn't have the courage to name then. Is this envy? That DHH's products haven't got this far? Or just naive? Because he should know the typical deal terms of a Pinterest and that valuations and raising are blown up for t…

He did say "Instapintora". That's not exactly subtle.

Re: All the oxygen trapped in a bubble

#60

Post by damoncali »

will_work4tears wrote: post #22

I don't have anything really substantial to add to this topic, but I find it interesting I have some serious envy for the "talent" that is so in demand. I went the easy route, chose the web development path in my education, rather than a more math heavy, software engineering direction. I've been slapping myself for years now, but this just rubs salt in my wounds. Granted, I interview very poorly, am not the most arti…

You are not asking for enough because you don't believe you are worth it. Seriously. Adjust your mindset.
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