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Comment by w1ntermute | Hacker News Reader

> I have some ideas, mainly around ensuring users aren't listing more than one property

This would destroy them. The reason Airbnb has grown far beyond what investors (and even the founders, probably) expected it to is because of individuals buying up and renting out large numbers of units as a full-time business, and because that phenomenon hasn't been stopped by regulators.

You can't build a $20B+ business on the back of individuals renting out spare rooms here or there for some extra money. You can build one by unlocking untapped value in the urban real estate market by converting long-term rental properties to short-term ones (whether that's illegal or has negative externalities is another matter).

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And that's the real thing that kills me here.

I'm told architects have a saying: "form follows funding", and that now seems depressingly true. During my years in the industry I think things have steadily bent toward revenue at all costs, damn the mission, damn the government, and damn any sense of integrity. Zenefits is Exhibit A for me, but I hear story after story of companies building themselves to flip and doing shady things to maximize the next quarter's numbers.

I wouldn't mind this so much were our self image purely about cash extraction, as in the financial industry. But once I think it was more about impact, and I fear we are telling ourselves that story more than the current reality justifies.

The venture-backed technology industry is nothing more than an extension of the financial industry, and anyone who says otherwise is lying or deluding themselves. The guys on Sand Hill are getting their money from the same sources as the hedge fund managers on Wall Street.

I certainly agree it is becoming that.

The reason I think it used to be different and could be again is that venture funding is in theory about creating very long term value. You don't get a company like Amazon or Google or Apple by focusing on the next week or the next quarter, as is typical in the zero-sum-oriented financial industry. You get it by focusing on the next decade, the next century. You get it by finding ways to create massive long-term value for everybody, and then taking a modest slice.

The trouble I see is that the MBA religion of "up and to the right" leads people to make a lot of short term decisions. In the short term, short-termism does wonderfully well. I'm hoping that the current dose of unicorn fever is temporary. But in my case it's pure hope; I don't yet have a reason to believe it.

Which is, interestingly, the American middle class.

Some Wall Street money is proprietary, sure. But a pretty good chunk of it is our 401ks and institutional pensions.

Pensions yes. But most 401(k) plans only offer mutual funds as investment options, and those in turn mostly only invest in publicly traded securities ( not VC funds). A few public companies have captive VC arms but those are pretty limited.

> interestingly, the American middle class

I would say, rather, "depressingly".

I think the "arms length" chasing of return by pension and 401k funds (whether active or index funds) is a problem. Our money goes places and does things in pursuit of returns that we would never consent to if we had to knowingly make the decision.

Out of which concerns have come socially responsible investing, triple bottom line and slow money.

Completely agree. I got fed up with the whole thing and went looking for opportunities to do useful stuff with the technology, without venture money and extractive shareholders. And found it.

Could you say more? I'd love to hear about your search and what you found.

To some of us the free market is integrity and the government and regulations are unethical beasts meant to be slain with technology. I see AirBnB and Uber as innovators in that space.

I think it's more a cultural shift away from libertarianism amongst a new generation of techies as the cause of the disconnect.

I have a hard time understanding that as anything other than a religious view. And a relatively new one, despite your claim that people are shifting away.

Read, for example, The Economist, which for 150 years has been advocating for free markets and against excess regulation. They've been doing it so long they prefer the phrase "classical liberal"; to them, "libertarian" is a johnny-come-lately term. Every time they advocate this stuff they do it not based on a tautological "markets are good because markets" argument. For them, markets are the best way to accomplish human ends: people that are better off, freer, more independent. But when markets work against that, they say so. For example, they're strong supporters of a carbon tax, because they see that as the least intrusive way to prevent further degradation on the atmosphere.

Markets are tools, just like computers are. They can be used well or used poorly, for good or for bad. In my view you have mistaken a mechanism for the purpose. When we decide how to structure society, it cannot be to serve the individual aesthetic or ideological views of a narrow group. It has to be to best serve its members. Nothing else is sustainable.

I see free markets as providing the least resistance to unfettered technological progress (which is ultimately what I'm after).

I don't think it's worthwhile to "decide how to structure society". Society should be emergent from individual freedom. Central planning can only cover the needs/ideologies of those doing the planning (and probably not even that).

Admittedly my views are radically post-modern and include a healthy dose of moral relativism i.e. there is no "best" way to serve society's members, just progress and the by-product of that progress.

Ok. You are after something that you define as "progress". Why do you think everybody else should act in ways that maximize what you want?

Also, you have already decided how you want society to be structured, which is devotion to a very particular definition of "individual freedom". (Other people have broader definitions of freedom that they are equally devoted to.)

I agree that there's no intrinsically "best" way to do things, but that doesn't mean we can't jointly converge on a shared understanding of "best". Indeed, I think it means we must work very hard to do so. Since God is dead, we must take up the work we previously assigned to him.

I'd also suggest you haven't really paid much attention to where your kind of progress comes from. Free markets (which require a fair bit of regulation to maintain) are a decent way to optimize certain things. But they aren't really good at anything that has relatively long payoff times. Anything with a payoff time of more than 25 years or so should be ignored because its net present value is zero. Anything where the value is hard to capture is effectively worthless, and that includes things like society-wide vaccinations, moon landings, GPS, the Hubble telescope, and our many interplanetary probes.

Or take the Internet. It came purely out of tax funding. The commercial equivalents were evolutionary dead ends like Compuserve and AOL, centralized fiefdoms with low interoperability. The network technology that drives it wasn't invented by AT&T, who had no interest in things that reduced their central control. (For more see the excellent history When Wizards Stay Up Late.) If not for net neutrality regulation, many Internet companies wouldn't exist; monopoly or oligopoly network providers would have made it too hard or extracted too much monopoly rent.

Or consider basic science research. Einstein never had a market-driven job in his life, and it's a good thing, as his freedom from practical concerns let him do amazing work. Very few Nobel laureates had anything approaching commercial goals or commercial support. I'd call the detection of gravity waves major progress, but that work received massive tax funding. Etc, etc, etc.

I'm not sure we've ever seen a 100% free market so while regulation appears on the surface to have been helpful, it could be viewed as solving problems caused by other regulations.

It's also important to note that the vast majority of major progress (including your examples) have been tied to war, conflict and war-like situations (Cold War).

Human conflict will continue to be a driver of progress but we've reached a state where the agents engaged in that conflict need not be centralized in the form of a government.

Some of us would like to race toward that situation while others believe there's redeemable qualities in the status quo. Interesting times as that dichotomy will likely grow as individuals continue to be networked together without the limitations of geography or citizenship.

This is exactly religious logic:

> I'm not sure we've ever seen a 100% free market so while regulation appears on the surface to have been helpful, it could be viewed as solving problems caused by other regulations.

The prosperity gospel types, for example use it to say that if something bad ever happens to anybody, it just means their faith wasn't sufficient. [1] Communists use it too; when I've asked why we would want to try communism when it has failed every time, they explain that it just wasn't "true" communism, that it would work if we'd use a more pure version of it.

This strikes me as ridiculous in two ways. One, it isn't falsifiable; nothing can ever prove it wrong. And two, advocating to run a country on a system that can't work except under the most perfect conditions is advocating for something that will never work in practice.

I also reject your thesis that war is necessary for progress. Einstein wasn't out there building bombs. Most Nobel winners are not engaged in war research. The Hubble does not have military applications, and neither do gravity waves. The CDC is not paid for out of the defense budget.

Your notion that the most effective way to get more progress is to have more war between non-state actors is, aside from being wrong, ridiculous as something to advocate for; exactly nobody will go along with it. I agree it's a reasonable consequence of unfettered pseudo-libertarianism, though. It's at least refreshing that you admit that; so many anti-government types have trouble admitting that by their lights Somalia is the freest place on earth.

[1] http://www.nytimes.com/2016/02/14/opinion/sunday/death-the-p...

I was thinking about this recently, and most of the major inventions of the last 50 years seems to have been state funded - the internet, GPS, the space program.

Free markets bring the products based on these to the masses, and incremental improvements but the technologies behind them are often funded by military needs. Most research seems to be done in publicly funded research labs, while the development side of R&D is done in private companies.

Definitely.

Other great examples include things like the US Census and the National Weather Service. It's just enormously more efficient to pay for certain things centrally and make them available to everybody because that enables all sorts of useful business activity. Same for roads, policing, and courts.

As an entrepreneur, I like markets a lot. But as an engineer, I think of them as I would something like state machines or map-reduce or machine learning: amazingly useful in the right circumstances, but not always the right tool for the job.

> $20B+ business

There is no way it's worth that much. As we saw from the Square IPO ("valued" at $6B+ in their last round of private funding; current post-IPO market cap about half that), the valuations of the past few years are all wildly overstated, just as the pundits have said all along. AirBnB will never be worth that much in a public market.

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