[brookst]

This is not remotely new. When I worked at Intel ~20 years ago, Intel Capital invested in startups that would buy Intel hardware. Some of them succeeded, some did not.

But "invest in companies that may grow your own TAM" is an ancient strategy. Sometimes it works, sometimes it doesn't (like any strategy).

I'm not disagreeing with you, just saying it's business as usual.

[georgemcbay]

I don't think its really the novelty of the situation that has people worried, its the scale of it and how that scale impacts the speed at which billions of dollars of market value could poof away when/if the music stops.

[Lerc]

I don't think it is a Novelty to people in the sector but it is a novelty to people hearing about it from a YouTube video.

People have always had difficulty understanding large scales.

I don't feel that I have the expertise to analyse business structures like these accurately and impartially, yet I am under the impression that I have a better understanding than many who confidently talk about it and preach the end is nigh.

Even if the end is,in fact, nigh. It will not render their reasoning sound. They will have been right more by coincidence than judgement.

[Grombobulous]

I think a whole lot of people understand quite well the difference in scale in this era compared to past eras of tech industry investment.

Webvan, Pets.com, eToys.com, Kozmo.com…all these dot com busts maxed out at less than 0.3 billion dollars in investment/IPO scale before they went under. A good amount of these share similarities with the AI bubble with a lot of them promising to be the e-commerce infrastructure of the future with “unlimited potential” as brick and mortar purchases were all predicted to move online. Webvan was going to be the automated warehouse of the future, for example.

Even the successful giant unicorns look minuscule in comparison. YouTube’s total investment was under $12 million before Google bought it for $1.65 billion, which looks like peanuts compared to these Hertz rent-a-server companies.

SoftBank dumping $8 billion into Uber looks positively quaint by comparison.

[lostlogin]

For anyone else wondering, TAM seems to be ‘total addressable market’ if my searching is accurate.

[fragmede]

It is. If you're interested in learning more, after the TAM, there is SAM and SOM. SAM is Serviceable Addressable Market, the part of the market that is realistic for you to target with where you are right now with what you've got. Finally, then SOM is Serviceable Obtainable Market. SOM is the number with the budget, competition, and sales, that you realistically think you can get.