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Comment by notacoward | Hacker News Reader

Opendoor got $1.9B in funding for this business model. In ten rounds. Did none of those VCs do anything approximating due diligence? Or did they do it and just not care that it was basically an AI-washed version of a very old con? Seems like there was more than one act of malfeasance here.

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Not sure what the "very old con" is, but the notion of AI-washing bad behaviors (e.g. predatory practices) is a fascinatingly succinct way to describe a lot of vaporware or similar issues "AI" promises.

I work in the space -- I'll be using this. Thanks for the encapsulation!

> Opendoor got $1.9B in funding for this business model. In ten rounds. Did none of those VCs do anything approximating due diligence? Or did they do it and just not care that it was basically an AI-washed version of a very old con?

“Brazenly breaking the law in a way that probably won't get cracked down on until after we’ve made a profitable exit” doesn't seem to business model VCs are at all loathe to fund.

What's the very old con?

It's basically Pressure Tactics 101. Claim (without a shred of proof) that you have a magic key to lower costs. Create a false sense of urgency to close the deal right now or miss out. (That one should be familiar to anyone who has shopped online in the last decade BTW, and I'll bet more than a few of you have implemented it.) You can do it with any kind of asset, really, but houses are big assets and the process is more complex/opaque than most so they're a perennial favorite. If somebody could truly make buying or selling a home that much better, you wouldn't hear about it by them coming to you.

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