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Engineered Addictions

masonyarbrough.substack.com

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Re: Engineered Addictions

#121

Post by vonnik »

klik99 wrote: post #20

> 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 co…

I wrote a couple pieces about how to take back control of your brain:

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...

Re: Engineered Addictions

#122

Post by duped »

klik99 wrote: post #107
sorcerer-mar wrote: post #89

Earlier quoted context omitted.

Correct, because GP said “legal obligation," which I agree: there isn't one.

Genuine question because I think I might be wrong on this one, or maybe misunderstanding what you're saying - aren't there cases of shareholders suing CEOs for not acting in shareholders interest and winning? If there was no legal obligation to act on behalf of shareholders how could they win those cases? My understanding is those kind of cases aren't common because a) they are hard to prove, b) the people being sued…

I think Matt Levine coined this phrase: "everything is securities fraud."

Activist investors will sue for anything alleging that executives broke securities law by doing anything that harmed their portfolio. It doesn't mean they win the cases, or that anyone is guilty.

There's also something worth noting that even if there isn't a legal obligation for executives to act on their shareholders interests, they have a really strong incentive when their compensation is mostly stock grants and the shareholders can fire them.

Re: Engineered Addictions

#123

Post by smikhanov »

Aurornis wrote: post #117
smikhanov wrote: post #102

Good people of HN, could anyone tell me why buying an MVP of a social network for $10K from a Belarusian contractor on Upwork (it couldn’t cost much more, it’s like five SQL tables and a web CRUD) and then charging users $2/month to use it wouldn’t work? Why does the author need to moan about how morally destructive it was to raise VC? Just run your social network from your bedroom, while asking ChatGPT how to rewrit…

> and then charging users $2/month to use it wouldn’t work? Commenters all across the internet will say they’d pay good money for a site that does something specific that sounds like a good idea. Then when the site is built, you will discover that they will not, in fact, pay any money for it at all. You will continue to add the features they request and the goalposts will continue to move. Social networks are even mo…

You description is probably spot on, but boy I’d love to have a version of Instagram where I could just pay $5/month and get a time-sorted stream of photos of my friends’ babies, Piña coladas with a beach background, and sweaty mirror selfies in a gym without any stupid ads in the middle.

Re: Engineered Addictions

#124

Post by badpun »

throwawayoldie wrote: post #33
sorcerer-mar wrote: post #27

Earlier quoted context omitted.

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.

I have a better idea: let's combat the notion that putting shareholder value ahead of the common good is moral.

Would you put your money into a business which put common good above your return on investment?

Re: Engineered Addictions

#125

Post by lucas_membrane »

duped wrote: post #82
sorcerer-mar wrote: post #27

Earlier quoted context omitted.

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.

The idea that executives have a duty to maximize shareholder value is a trope from business ethics class, not law. I say this because you used the phrase "fiduciary duty" which does not exist in this context.

> from business ethics class, not law

Well, there was one case in the law over 100 years ago in the USA. A company had decided to sell itself for cash and go out of business. The Court ruled, that in that situation, it should sell to the highest bidder. This is long before Milton Friedman began advocating that corporations had a duty to their common shareholders that provided the only valid yardstick for evaluating corporate activities. Friedman was an economist, and a controversial one, not a lawyer, and how he got the lawyers behind him is itself a long strange story.

The idea that common shareholders own the corporation was not really obvious to anyone from the start. Common shareholders get from the corporation only what is their privilege according to the corporate bylaws and charter. There are now, and have been in the past, many different kinds of and classes of common shareholders. For example, some big corporations today have many common shareholders who do not have any voting rights. The thing that sets common shareholders apart from the other stakeholders who also hold pieces of paper from the corporation granting them various interests in the corporation, is that the common shareholders get to divide up whatever is left over if and when the corporation is liquidated and everyone else is given what they are owed first. They are more heirs than owners. It is more realistic to hold that the corporation, as an artificial person, is not and cannot be owned by other persons, and owns itself.

Re: Engineered Addictions

#126

Post by klik99 »

ChrisMarshallNY wrote: post #60
klik99 wrote: post #20

> 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 co…

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. N…

"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.

Re: Engineered Addictions

#127

Post by watwut »

sssilver wrote: post #66
sorcerer-mar wrote: post #44

Earlier quoted context omitted.

This still does not produce any legal obligation.

Ok but you’ve lost your mission, your tools to accomplish that mission, and effectively your company.

Yeah, but you not getting what you want, you not having own little imperium is not the same as "you having legal obligation".

This amounts to an argument that if doing something immoral gives you money and power, you can not possibly say no and no one can blame you. That somehow more money and power is good enough excuse.

Re: Engineered Addictions

#129

Post by smikhanov »

pathsjs wrote: post #120
smikhanov wrote: post #116

Earlier quoted context omitted.

How in the world is it easier to attract people to some new VC-funded nonsense?

For one thing you can use VC money to pay for ads

But for a paid social network you can do that too. All you need is for CLV to be higher than CAC.

Re: Engineered Addictions

#130

Post by wonderwonder »

klik99 wrote: post #20

> 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 co…

“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
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