[epolanski]

It's called butt cigar investing or corporate raiding.

They acquire startups and companies without a huge growth potential but modest cash flow and little profits.

They cut the operating expenses to the minimum and jack up the prices to sky rocket profits till their mathematical models will tell them they will profit on the investment.

Rinse and repeat.

[joelthelion]

Have there been any serious legal efforts to make this less profitable? It's very clearly detrimental to society.

[tmp10423288442]

Why would it be detrimental to society? Many companies have developed all the products they're likely to ever develop, so why would you maintain the same level of operational costs as when you expected growth? There's no guarantee that the prices charged before the acquisition were sustainable either.

[joelthelion]

They don't just maintain these products, they enshittify them to extract the maximum possible profit from captive users, until someone else comes in and builds everything from scratch all over again.

This is crazy inefficient yet it's not captured in our economic theories, so we're essentially blind to it.

[johnnyanmac]

Not much you can do. The alternative is bankruptcy that does a similar thing to workers. But it at least doesn't let the company make blatant lies of a PR statement.

The main thing to do is make it so you can't just lay off people as easily as you can in the US for pretty much no reason. But it seems workers are still too divided to really come together and achieve such 9initiatives. Be it unions, pressuring their governments to make new laws, or simply chastising and boycotting companies who engage on such actions.

[Ekaros]

In healthy working free market. There should be competition delivering better product at cheaper price.

Maybe one thing we should do is to allow suing company executives for breach of fiduciary duty when they waste resources on some useless project or feature. This could make many companies more efficient.

Oh and also ban dumping. You should not be allowed to sell stuff below cost of production. Development effort with big maybe ignored.

[ImPostingOnHN]

Private equity (what's being described here) has more political influence than "society" because money.

[johnnyanmac]

Society has more money and way more votes than PE. I'm going to quote A Bugs Life (1998) of all things here:

> Hopper: You let one ant stand up to us, then they all might stand up! Those puny little ants outnumber us a hundred to one and if they ever figure that out there goes our way of life! It's not about food, it's about keeping those ants in line.

In our case, it's more like a million to one

[ImPostingOnHN]

I suspect that the free cash flow of those who seek fewer regulations of this sort on thing exceeds the free cash flow of those who seek more.

People that are being squeezed by PE have less money to wield as political influence partially because they are being squeezed by PE.

The ones doing the squeezing are ok with that.

The people who are uninvolved, who fit into neither box, don't care enough or don't have enough money they're able & willing to part with. They also don't have fancy accountants or corporate accounts to expense it to.

This is the local optimum.

[johnnyanmac]

>The people who are uninvolved, who fit into neither box, don't care enough

That lack of care is going to cost us all in ways we'll be forced to care about one day. Not necessarily for Vimeo, but definitely much more important things that people are ignorant or actively turning their heads against.

> They also don't have fancy accountants or corporate accounts to expense it to.

We call them our represenatives. We expense it to them with our votes (and literal expenses with tax dollars we are forced to part with). But votes require care and we're back in the loop.

[ImPostingOnHN]

> That lack of care is going to cost us all in ways we'll be forced to care about one day.

By then, it'll be too late. The ruling party has a monopoly on violence, perpetrated by sycophants and enabled by wide-area surveillance analyzed by AI. We're a matter of months (maybe years) away from kill-drones being used with impunity against the populace.

> We expense it to them with our votes

Gerrymandering by the ruling party has ensured that your vote won't make a difference. Even if it did, election interference by the ruling party has ensured that it won't be counted. Even if it is, the ruling party has expressed its wishes to cancel elections, and who's gonna stop them when they have all the kill-drones and thugs, paid out of a bottomless bank account?

[WarmWash]

SaaS is the detriment to society. Static feature software continually updated and changed to create a faux justification for $20 of your money a month, keeping you on an endless treadmill to in order to work with all your old data.

Sometime in the late 00's they realized people were still happily using software from the 90's, because it worked for their needs, and well, we can't have that...

[_DeadFred_]

In the Reagan loving greed of the 1980s this was considered vile, movies were made and the people that did it excluded from polite company.

[epolanski]

This is just how capitalism works in a competitive environment: it allocates capital as efficiently as possible.

I despise their business model, but it is what it is.

[johnnyanmac]

It really doesn't have to "be what it is". We can strive for actual change. But everyone's still too cushy for that, it seems.

[epolanski]

But what actual change do you want when the very founders of these companies like Vimeo, multi-multi-millionaires decide to sell their life's work, customers and workers very well knowing what the fate's gonna be, just to be even more wealthier?

[johnnyanmac]

To summarize what I put in another response: I personally care less about holding the multi millionaire into account (though I wouldn't mind it at all) and more about making sure employees over such deals aren't lied to and then have lives upended at the drop of a hat. Workers and customers do not in fact "know what the fate's gonna be" and that's the problem to address.

I won't repeat the same usual solutions again, but I'll mention one thing that already exists: the WARN act. The spirit of this is good, to give employees a 3 month buffer of when their job is ending. But it's clearly abused at worst, and not enforced at best. It's not as good as other countries' worker rights, but ot exists today to be looked at. In addition, severance can help to. This is standard, but even the "generous packages" in the US tend to be on the lower end of what other countries need to do.

Basically, it shouldn't be a drop dead easy decision for a company to mass layoff and have the workers surprised at the facs. It needs to both be slowed down and give immediate short term costs. That's a start of "kinda actual change" to strive for.

[epolanski]

> Workers and customers do not in fact "know what the fate's gonna be" and that's the problem to address.

1. Bending Spoons model is known, everybody knows as soon it's announced

2. The company belongs to the shareholders and founders. It's them making the decision.