[jacquesm]

The AI feeding frenzy in VC land is reminiscent of the early days of the public access internet aka the .com boom. That corrected itself sharply but eventually most of those .com boom dreams came out, just a bit later and lots of VCs lost lots of money because they got the timing wrong.

Every time there is a major shift in tech you see this pattern repeat but I don't recall seeing it on that scale again since ~2000, even though lots of stuff has happened since then (for instance: the mobile revolution).

Investing in AI for the sake of companies using AI because it increases their chances of funding is the hallmark of a bubble, and that will probably end the same way it did before. But if you manage to pick the winners early it will pay off in spades. The big question to me is whether or not those winners will be part of the first wave or the second, usually it takes a while before a new technology really comes into its strength.

Until then there is a pretty big risk that what looks to be an early winner will be displaced by a party from the second wave which is better positioned to take advantage of later, more mature versions of that technology, which by then may well be able to displace those 'early winners' by a couple of guys with an open source package.

Not an easy time to be an investor.

[ethbr0]

Total addressable market and value proposition are key.

A specific technology doesn't really change either of these.

"I am going to sell pet supplies to people who need pet supplies"

Okay, how many people need pet supplies and why would they use you instead of the store down the street (in the 90s)?

"I am going to sell books to people who need books"

Is obviously a better proposition, even before we get into the fact that it's "online" or uses any specific technology!

[asterix_pano]

Why is the second one a better proposition?

[ethbr0]

Because the TAM of people who want books is a lot larger than people who want pet supplies, and there are compelling reasons why people would rather buy books from centralized warehouses than local inventories (namely, that books have a long tail and pet supplies do not).

[rcme]

This makes 0 sense. What makes you think the market wasn’t already adequately serving people who wanted books? New technology is the only reason this sales pitch worked. It’s not enough to provide books. You need to provide more books at cheaper prices than existing incumbents. Without knowing the competitive landscape, you can’t say whether or not selling books is better than selling pet supplies.

[ethbr0]

Types of dog and cat foods are more substitutable than book titles, which decreases the value proposition of warehousing a larger variety.

And on the profit side, books don't spoil and are small and light.

Bezos is on record in an interview somewhere as saying that he didn't care what they sold on the internet -- they picked books (and later music and movies) because they were good fits to store and ship.

[rcme]

This was your original statement:

> Total addressable market and value proposition are key.

> A specific technology doesn't really change either of these.

Bezos chose books because they ship well. This is because he was going to use a new technology (the web) to sell goods and needed items that would work with this model well. So the decision to sell books had little to do with TAM and everything to do with technology. Basically the opposite of what you originally asserted.

[fakedang]

Rationalize all you want but Amazon's retail arm still turns a loss, minus platform ads. Bezos realized early on that the bread and butter of Amazon is AWS (and Amazon software in general), and that's what's keeping the retail arm stable.

From a revenue perspective though, your argument is prudent. Maybe targeting books rather than pets helped it lessen its relative burn rate.

[ENGNR]

That whole internet bubble, and where's the internet now, pfft

[jacquesm]

Timing is everything in investing. You can get it right in principle but wrong timingwise and still end up losing your shirt.