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Comment by sobiolite | Hacker News Reader

The analogy to MLM doesn’t work. In a pyramid scheme, early investors are guaranteed money, whereas late investors are guaranteed losses. With a vibe-coding platform, everyone has the same (extremely low) odds of building a hit app, so is at least more equitable in that sense.

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I think the point the author is trying to convey, is that they are similar to MLM schemes in that they profit off of peoples hopes and dreams. Altough there are MLMs that are pure pyramid schemes, there are some where it is also not impossible to earn some money with it. Their products do not even have to be downright bad or fake. Having read Daniel Kahneman, I suppose with (economic) desperation people become especially suceptible to hear the siren's call of such marketing. What would have made the comparison to MLM more apt tough, is if there would be a thing like: you buy X subscriptions and may resell them, or if you have Y people that you convince to also become subs/tokens sellers you also get a cut.

> I think the point the author is trying to convey, is that they are similar to MLM schemes in that they profit off of peoples hopes and dreams

Every scam plays to people's hopes and dreams. As do most legitimate opportunities.

> they profit off of peoples hopes and dreams

Not trying to be overly cynical, but isn't that just marketing?

A lot of marketing just getting people to picture a better future version of their life and then making them think that your product will get them there. They're not actually buying the product for the product, they're buying it to try to get that imaginary future. I don't really see how Repilit ad telling people they can built the app of their dreams is very different than a gym ad telling people that they can get ripped or something like The Container Store showing someone with a messy house magically getting organized and cleaned.

I'm not saying that any of those examples are particularly good or moral, but I don't get how what Repilit is doing is any different than just standard marketing tactics we see every time we watch a block of ads.

This is a good point and I agree, this is just marketing. But I do think there is a moral continuum in that. I want to say on one end lies purely factual dry information: "On offer today are bananas, they cost x currency units, which is cheaper than Store ABC ...". On the other end is something amoral--maybe a good word is "scam"? Selling hopes and dreams, as I called it, is not immoral per se, I also agree. Where the threshold into amorality lies? idk ... But to take the Gym example, I've seen ads which are pretty okay, and some that are scam-ish. If they sell you a realistic, attainable goal of "getting fit" or whatever, that's okay. If they show you a pro athlete (10y+ training, substances and genetic luck) and tell you that "everyone" can achieve this ("you only need to sign up! just a few months!"), that is amoral to me, but not a scam. I would categorize the example in this post somewhere in that moral category.

> everyone has the same (extremely low) odds

In the author’s example, Replit has a very high chance of making a profit on those folks’ desperation.

It’s not exactly an MLM. But the predatory mechanism is close. Loan sharking might be a more exact analog for the financial bit, but the social-media marketing strikes closer to MLMs.

I think the standard analogy would be selling shovels to the gold miners.

> standard analogy would be selling shovels to the gold miners

There was actually gold in the California hills. Nobody is starting a business the way the Replit ads seems to be pitching.

This one’s a simple pump and dump before the attorneys general get wiser.

I'm sure someone somewhere at some point has made some money on replit. There is always an outlier.

Keep in mind the vast majority of gold miners found no gold.

> the vast majority of gold miners found no gold

Source? We would do panhandling trips as Boy Scouts in the California hills. On each outing at least someone found gold. Which means every one of us would have eventually found some given a few days.

Most panhandlers didn’t break even. But I’m challenging even that threshold for Replit. I’m guessing most of their vibe-coded businesses never make a penny of revenue.

I've always wondered what keeps people from wandering around the area with exotic ground-penetrating radar, XRF guns and other tech that didn't exist when the veins were originally judged to be tapped out. There might be some serious gold left after the visible stuff is gone.

It's similar to dating app companies selling to young desperate men, although these companies have much more insidious tactics (sending you a match right when they predict you might give up on the app) than e.g. Replit who have still not fully figured out how to hook users just enough to continue to get them to pay (not sure, though, how they can give you a hit app right before you give up on them).

I think it does. MLM is multi-level-marketing and the shovel-selling exactly IS a pyramid scheme.

You have to look more deeply into the scheme. It appears that they sell the SaaS, but what they are actually selling is the selling/referral system itself which makes it exactly a pyramid scheme.

Just like the tupperware was never the money-maker, is the referral system.

There is already the very classical grift : you don't sell genai content, you sell "get rich quick with genai" methods. This is where the recursion starts.

MLM — multi-level marketing

Let’s make it clear right away: none of them are building a “hit app”. Maybe one in a million does, but it’s the same as winning a lottery. TikTok grifters will just siphon commission for the video and move on. It’s a clear MLM, you can see it with peptides too.

Selling to desperation is not the same as an MLM. TikTok grifters don't expect their watchers to then go out and grift on TikTok themselves while giving the original person a cut, there are no levels to this sort of grift, as would be required in a multi level marketing scheme.

They absolutely do, you’re just looking at the leafs of the tree.

Most TikTok products I know are not of a multi level format, the originators do not care if you buy their course then make your own course as they see none of that money beyond the initial sale.

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