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Comment by chankstein38 | Hacker News Reader

While I'm sure a lot of this is tech folks, I think part of the problem here is that it enabled any rando sleezeball off the street to be like "Hey I made an AI product. Look!"

I've personally known a few of these folks at this point and yeah they don't actually even understand what they're doing half the time they're just watching youtube tutorials and setting things up not caring/realizing/whatever that what they're calling an "AI Product" is actually just a bot they connected to some API that they fed a really brittle system prompt into. But everyone should be impressed by them because they managed to ~follow a youtube tutorial~ set it up! (Sorry, kind of PTSD from one in particular)

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I know exactly what you mean, but this kind of people were sold on a particular idea of what being a founder/entrepreneuer is. Just grind hard and make products and at one point you will make it. They see emerging trends as opportunities without having a knowledge about them, and if they are lucky, they will convince some people to actually buy that.

But again, one would think that venture capitalists who are throwing apparently, hundreds of millions of dollars into it, would have an eye to filter out this kind of characters.

Evaluating a business is tough.

VC is like that because many of them missed many boats of very profitable startups in 2001 thru 2010, where "stupid business trick, now with software!" was almost always an OK bet.

AI is the new dot com, which means we are at least one more bubble away from mass usefulness

> But again, one would think that venture capitalists who are throwing apparently, hundreds of millions of dollars into it, would have an eye to filter out this kind of characters.

Yeah, this is the most worrying part to me. Especially after many just got burned by crypto.

I think some of the "filtering" is laundered and disrupted by VCs giving money to legitimate businesses who turn around and spend it on very questionable AI products.

VC is a tricky business. Most operating at scale see more variety in their deal flow than they could hope to understand in any deep way. This is one of the reasons team & traction matters so much more in early funding rounds (1); evaluating product is difficult even for engineers with domain experience (2). Much more so for a finance major with domain experience in private equity & TED Talks. Hype trains give VCs three ways to win: the hype proves real; the hype lasts long enough to WeWork an exit; a portfolio that includes prominent hype sector start-ups helps ensure the VCs next fund is fully subscribed.

Add to that the recognition that all going-somewhere trains were hype trains at one point in time and it’s silly to expect the latest round of fraud and tulip-mania to teach VCs lasting lessons.

1. I’m told biotech/pharma VCs are more product versed and focused.

2. “When this product hockey sticks there won’t be time to rebrand. That’s why we have to change to Meta now. Or maybe X. Whichever has the better bespoke font.”

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