[hn_throwaway_99]

The issue is that there are a large number of products/companies (I think the vast, vast majority) whose addressable market size isn't that big, but when they take VC money they do all types of unnatural things to try to grow instead of focusing on the couple things they were really good at. Couple cases in point:

1. Totally agree with the comments that VC funding absolutely killed LastPass.

2. Twitter is probably another good example. Twitter was a really large business, but they were constantly wringing their hands about what they could do to get as big as Facebook or Instagram. What if the answer was always just "No, you'll never be that big, just don't even try". So instead of improving their core bread-and-butter (and fine, easy to argue they didn't even do that super well), they wasted a ton trying to get users who were never going to use Twitter in the first place.

3. Very closely related to this idea about "When large sums of money become toxic", the private equity consolidation in US health care is another ongoing disaster. PE comes in with the promise of "streamlining operations", but instead they are just vampires, cutting stuff to the bone so that the health care system isn't able to respond to spikes in demand (e.g. Covid): https://www.statnews.com/2022/12/14/moodys-private-equity-he...

[mbesto]

Ya, but can you name any products where this is the opposite? Meaning, how many products do you use that aren't VC backed?

[hn_throwaway_99]

craigslist famously rejected taking outside money for years.

But more importantly, I don't think VC or VC money is always bad, but I get extremely wary when a relatively small company gets a shitload of money that they'll then be forced to grow into a way that means they'll lose focus on their core product.

I remember when I told a friend of mine that Postman raised nearly half a billion dollars in total funding, and his jaw dropped "You mean that browser plugin that allows you to make REST calls???" And sure enough, postman got filled with more and more "enterprise-y uselessness" to the point that I just stopped using it.

[mbesto]

> but I get extremely wary when a relatively small company gets a shitload of money that they'll then be forced to grow into a way that means they'll lose focus on their core product.

Irrationally so. That's my point. There isn't a strong indicator that correlates to a company being a craigslist vs a company being a Postman. The median is somewhere in between and its not as dire as you pose it to be.