What a venture capitalist really is.
People think that the game VCs are playing is very simple. That VCs are essentially betting on companies, hoping that among those chosen, a few will become unicorns and the VCs will get the 10x returns they seek. LMFAO
In this conception, what distinguishes the VC is the ability to “see the future”, to predict trends, to evaluate technologies and use data and market knowledge to make the best bets. It is their instincts, their ability to read the pulse of the market, and find bright young founders with that “special something”. Basically, the VC is somewhere in between a talent scout, a day-trader and some kind of futurist speculator.
That might have been an apt description in the early days of the technology industry, but today, it bears almost no resemblance to what is going on. Not only does it ignore huge parts of the financial picture itself, but it posits finance as the only motivation of an industry that has moved far past that as the sole defining motive.
Here is a what is actually going on:
+ What do VCs want? Everyone says: they want money. Of course they do! But this leaves out major other drivers for vehicles like: power. Power and money are intwined, but they are often distinguished and don’t necessarily carry a 1:1 balance. No, the venture capitalist is interested in money but his interest is not merely fetishistic, money for money’s sake, its not consumerism; and his interest certainly doesn’t end even when he has attained enough money to satisfy every conceivable human whim for himself and his family and lineage indefinitely. Many of the architects of the industry surpassed that mark long ago, still they go on. That is because they are colonizers and empire builders, imperialists and war hawks. “Software is eating the world” is, in fact, a literal statement about the goal of VCs: to take over the world. And Mars.
Oh, that sounds extreme? Then why are they pumping huge amounts of resources into building a tech stronghold in every major city on earth? Why are they trying to force a new kind of currency that they themselves bought unimaginable amounts of at rock bottom prices (aka when they launched them)? Why are San Francisco and Oakland not even ghosts of what they once were? Why do tech companies dominate the NASDAQ and already have their own exchange? Why do they liaison directly with foreign heads of state, have access to the highest level of political power, and are actively fighting in wars (currently, Ukraine)? Why are they intent in capturing every person on earth in yet another series of ever more specific and effective panopticons? Why do they pursue amounts of money that aren’t “making LPs happy” money, but that is “run the motherfucking world” money?
The only reasonable explanation for all of this is that they are power-mad psychopaths who are trying to achieve levels of world dominance unprecedented in history. “Technology” is simply the vessel, an operating system for modern colonial takeover.
+ The fundamental mental shift to make is that VC is no kind of “betting,” it’s market fixing. The illusion of the free market is particularly intoxicating in the Valley and in America broadly, the myth that somehow we as consumers of technology are deciding the future of startups and providing the barometer for what is built; we assume that all the data on us that they are collecting is being reflected back to us in their products. Absolutely not. “Adoption” is a myth. Consumers simply do not “adopt” technologies; the technologies are decided for them and then shoved down their throats. So who is choosing the technologies? VCs.
There’s an idea that venture capitalists provide money to a new startup and maybe do some mentorship, and then they basically hope and against hope it wins and sails out there in the “free market”. This is simply not the case. Venture capitalists literally FORCE startups into adoption. They are incredibly hands on in EVERY level. Their company WILL succeed. When a VC invests in a startup, that startup goes into a machine for turning startups into effective venture capital tools and financial instruments. They are provided with legal teams, given the best programmers and specialists in the industry, introduced personally to customers around the globe; VCs will often force other companies in their portfolio to use a new entrant’s software. Their portfolios function as install bases for new companies. And VCs give their startups a front-facing position in the reverending swarm of technology propaganda — a media ecosystem that is owned and controlled by tech, down to The Atlantic and The Washington Post and BuzzFeed.
And — key point — they will absolutely ensure any potentially competing startups gets NO money to grow — that’s why Twitter and Facebook have been the only game in town for fucking 20 years. Anything that could meaningfully threaten Facebook is of course, bought very quickly and integrated. The same for all other tech companies protected and backed by VCs.
Venture capitalists fully control the technology market and its ecosystem, and thus they create the destiny for the industry and for global users. That is an incredibly centralized, monopolistic, completely undemocratic point of decision making about what technology is built and what it is used for. It is basically complete control of the market.
+ We think that startups are organically proliferating based on some natural fluctuation of human genius and insight and exploration in the world, that innovation has its own innate rhythms and patterns, and that VCs are simply following along that human arch and investing in the right place at the right time.
This is very much not the case. In this latest web 3 bubble, you can literally see venture capitalists giving orders: they rolled out the new branding and the new agenda for the industry, and showed they will be funding crypto startups, weapons companies and potential metaverse features. That’s the agenda. And all of the technologists in the Valley took immediate heed; the king has spoken. Existing companies rebranded as web 3, all of the sudden everyone has a web 3 startup, classes in CS schools across the country switch up the programming along with all of the hacker schools and other pipelines. People starting a new venture must accord with the VC’s directions, otherwise they will get no funding. It was really remarkable to watch, actually, how quickly the entire technology infrastructure in the country, including schools and mass media, got right on board with it.
You got to see who REALLY issues the orders around here.
So what is a startup? It’s a self contained team of technologists working on a venture capital project. Startups can function as many things, in a model where there is enough wealth that any specific individual startup can have purposes outside of turning a 10x profit. WeWork is perhaps a good example of them developing yet another real-estate takeover weapon, even if the immediate returns were shaken at some time period.
This is a critical point: timelines. People think VCs are working on a timeline of funding to exit. No. VCs are working on hundred-year and longer timelines, and all analysis must observe that reality. Crypto itself has been in the works by VCs since the 90s.
Anyhow, purposes for startups outside of money can include data collection and surveillance, testing grounds for various practices and techniques, R&D/test lab, ways of building features for larger platforms, etc. They don’t need every startup to be profitable and having every startup be profitable isn’t necessarily even useful to the broader mission.
Startups are formed specifically to meet the needs of the venture capitalists. VCs say what they want built, startups form to those specifications, and VCs decide which ones of them they will crown and then force down the industry’s throats and its users broadly. The idea that the technology industry is, or ever was, driven by consumer choice is an utter lie. End users themselves are completely brainwashed into thinking any of this is coming from them, in their interests, etc. This is not bottom up, its direct from the top.
Think about it. When it comes down to consumer choice, its basically like: pick one of two computers. Pick one of three headphones. This is your one phone. Here’s the VR you will be using. Currency? You can have Bitcoin or ETH. Social media? It’s almost all owned by Meta or will be. This is evidence of monopolies in the market that have been the natural and consistent result of VC activity. We should be seeing a proliferation of creativity and versatility and individualization, but the result is more and more standardization and stagnation, more and more centralization. I can’t walk down the street with seeing a girl in the same rose gold Apple headphones, the same iPhone, wearing the same clothes from the Adidas store on Amazon.
These monopolies are created by the venture capitalists, who will simply not invest meaningfully in anything that could compete with one of their companies. They are inherent monopolists. And there’s no place to get money for technology that doesn’t have VC as some core part of that, and startups need very significant capital to have a chance in this market. VCs solely control or at least sizably influence any viable technology funding source. The technology business model leaves very few other ways to possibly achieve widespread use of your technology than via venture capitalists. And thus the amount of power they have over what is built is near total.
+ People assume that there’s some sort of competition between VCs and that that competition serves as some kind of moderating force and balances the industry against corruption. But VCs aren’t competing with each other, not in any material way. Take the PayPal Mafia - they aren’t centralized in one VC firm, no. They all have their different funds and foundations and media companies, and yet they are all still a united front. I.e. See how Founder’s Fund (Peter Thiel’s firm) and a16z have the same exact messaging about “American Dynamism”, aka, the massive expansion of tech weapons building. VCs might have squirmishes between them, but the latest bubble should show you the degree to which all VCs are on the same page about the direction of the companies… and that what a16z says goes. That’s why you see alllll of the VC firms doing web 3. It is their combined agenda.
Most VCs and tech billionaires have worked together many times, made money together many times, pulled off all kinds of shit together. They are cronies, not competitors. It doesn’t mean no one ever swims with the fishes, but it does mean that, yet again, what is being presented to you as many entities is in fact one entity.
+ VCs take control of cities. This is absolutely core to their business model. They completely took over San Francisco and Oakland, turned it alllll into one big old dorm room for tech employees. The devastating gentrification by tech of these areas has been documented extensively by the Anti-Eviction Mapping Project. We’ve seen the same thing in London, and many more cities will fall. A lot of their money AND their power comes from their ability to come in and utterly dominate cities. You hear about this idea of “tech cities” constantly, perhaps its a “Bitcoin city” even; and that is very literal to them. Tech has seen, in San Francisco and Oakland, how profitable a city can be to destroy and to run.
Their takeover involves:
gentrification, company towns, mass takeover of real estate, invasion by armies of white male programmers, bribing local politicians, securing ridiculous tax breaks that harm the city, displacing hundreds of thousands of people, creating a 10x wealth gap, arming the cops with tech-grade weapons, bringing in their own private police forces, developing an underpaid contracted workforce that gets no stock, union busting from onset, starving the community of tech money in order to force local communities and businesses out, replacing those with their own bars, restaurants, clubs, etc., driving up rents astronomically, sadistically terrorizing unhoused people with psychotic disorders like they do in the Tenderloin…
VC is currently invading the following cities:
- Dublin
- Miami
- Palestine
- Detroit
- Nairobi
- Austin
- New York
- Atlanta
- Chicago
Who else?
+ VCs are panopticon builders, something punishable by death under natural law. They build panopticons and they put as many people as they can in them. I think of VCs as PacMan trying to get every single bit on the screen — they are in a race to collect all of the data. They share the same stated goal of the CIA, which is to collect and house forever all data. Period.
VCs capture and centralize data. They are the driving force behind collection and centralization. VC has built absolutely giant data stores in the last bubble. Think of all the data sitting in Facebook and in AWS alone. Data on people is a weapon against people— and that weapon is exclusively in VC hands. There is a direct correlation between data and money and power. VCs send out their startups to the smallest and strangest places in search of as much data as they possibly can get, little satellites which then feed their data into the larger data machine and the data of the portfolio. They are a new kind of criminal, which is a data criminal, a criminal who uses data to commit crimes against the People.
+ And our last point for today: They create wealth gaps. It’s not just that they want to make money; making money is easy, all of them already did. But what about making a *wealth gap* and increasing wealth gaps? Different movements in the last bubble like Silicon Valley Rising demonstrated very clearly the way that tech creates a criminally underpaid class of workers while using their high-paid programmers to oppress and abuse them. I won’t go on at length about wealth gaps and why they benefit a ruling class and other groups, and how they forward oppression, but suffice to say, understand that creating these gaps is a vital part of their business model.
The fact that VCs doubled or more their wealth during the pandemic should offer no other proof than that their wealth emerges directly from the poverty of the people, and that there is an inverse relationship between the sickness of our people, our cities, our children and the success of VCs. This fact alone should earn them the death penalty in the People’s tribunals.
There is no other way to stop them. We have tried for the past 10 years and we are out of time.
I obviously have a lot more to say about VC, but those are some of the most salient points and shifts that I would like to see recognized in the industry, but also more broadly, wrt how technology actually operates.
People are living with a happy illusion of what a VC is at the exact moment that these predators are posed to strike with awesome consequences and fully take over the financial and war infrastructure of the world, as well as all of our beloved cities.
Wake up. Venture capitalists must be stopped.
The Tenderloin stands.