I find these tech trend articles pretty reductive and this one is extra flimsy. Most of the evidence cited for this trend relies on the bad portfolio of one bad investor (SoftBank), the cannabis industry as a tech bellwether, and a handful of quotes from random VCs (there are literally thousands of VCs). Software is transforming every industry right now. There are thousands of high growth, money losing startups inside large profitable enterprises. Tech is not a monolith. The economics of Software-as-a-Service (high revenue retention rates that transformed volatile license software companies ten years ago into predicable revenue streams that look more like bonds) was a major business model innovation that created a trillion dollars of value. It has perhaps been over extended now into industries that are fundamentally nonrecurring and we are perhaps seeing the shake out. That is a story maybe? But these trend pieces saying tech is X because WeWork (for the 1000th time) is neither specific enough nor helpful. NYT should offer more nuance here.
47
Not a surprise, this correction is long overdue, too many companies with no pathway to profitability were being funded. I suspect this downward trend will lead to the next recession predicted by the inverted yield curve. The global economy and stock markets are taking a hit from the coronoviras that may lead to corporates defaulting on their bonds which have grown 50% since the last recession.
4
@Joseph B greetings from Australia. I think there are deeper are more links to all of this.
I have the theory of "saturation". How far we can go when people's income, part time jobs, cost of living and many other variables that affect all of these. When there is no money, no need to change mobile phones every 6 months, convert all cars to electric ( and the traffic jam is not resolved???????). Madness out of madness. If goods do not fail as before, because there are thousands of x product manufacaturers, perhaps? and the goods do not fail that often........then "saturation" has ocurred ? A mad race, besides we survive with food and water and we cannot eat money.
12
......and thus the disrupters are themselves disrupted. Icarus falls to Earth.
11
I am writing my master thesis and building pilot for my own startup - it will be AGI - Artificial General Intelligence Cognitive Architecture - some kind of CERN of AI (unfortunately - individual scientific projects ar just lab pet projects in the field of AI), just on the laptop, best of science and some revivaval of old good AI that is (badly) forgotten in the age of subsymbolic neural networks and big data era (while the future lies in hybrid methods and small/valuable data). It will be game changer - it will replace all those silly chatbots with the truly intelligent dialogue system, it will replace show-and-guide robots with the self-exploring and goal driven robots, it will replace big data with the small data, it will replace data processing with reasoning. It is hard to build such startup - I have full time job, I have studies, I have no guidance in my local faculty (I should study the best literature from abroad), but I am really doing something valuable, that will automate jobs, that will eradicate the necessity for human exploitation and that will change society. I am working, well, some bit of pizza/chatbot/wework-offfice... money would accelerate my efforts, but I am conscious about the ethical dimension and that is why I am not in this machine. I need time for reflection, experiments, reading and thinking. I wonder why the society support the system of silly applications and why no serious businesses from the science?
@Etienne If you truly have an AGI, then you won't need any investors because you'll have taken over the world.
10
Look at the educational backgrounds and work experiences of the recent principals and partners at VC funds.
- Do they have engineering degrees ? NO
- Have they run a tech business with P&L? NO
- Do they have MBA's ? Majority dont
- Do they have global experience ? Run a business or scaled globally? Many have not even worked outside SF ever
Sorry playing lacrosse or ftball or crew at does not teach about AI or Cloud Computing .. and having never led a tech business you dont know how to scale one.
and please dont insult tech companies by calling scooters "tech"
experience?
19
Anyone who thought scooter rentals was the next Google deserves to lose their money.
27
20 years is plenty of time for entrepreneurs and venture capitalists to forget history.
There's very little difference between this era and the dotcom rise and fall.
Companies still think it makes sense to sell 40 lb. sacks of dog food online.
It would help if journalists showed a bit more skepticism. But they didn't then, and they haven't until now.
8
Every VC-backed startup is expected by its investors to eventually go public or get acquired.
For many startups, the latter requires finding a greater fool to buy the company. In the private sector, that seems to be getting harder.
In the case of IPOs, maybe people are just getting tired of red bottom-line companies privatizing gains while socializing risk.
Profitability pretty much immunizes a company from either of these problems and lets it pick and choose liquidity opportunities. I hope the trend continues.
8
OK, hear me out: it’s a Bluetooth-connected signaling device for electric scooters. I call it "Unihorn".
9
“The start-up, he said, had to be profitable from the beginning.”
Congratulations. You just invented capitalism.
12
Just because you can write an app for a silly idea doesn’t mean you should.
12
Softbank is the world's largest Ponzi scheme.
10
I’ll be glad to see those stupid scooters off the street.
21
Please tech, please, go away.
16
It seems like the venture capital model is really quite simple: put yourself between a person with money and a person who wants to spend that money and try to catch as much of it as you can. No special knowledge of business, finance, accounting, marketing or management is necessary; however, a high degree of credulousness is essential. The one rule: it is always someone else's money....and risk. Be sure to charge massive fees and debt service and bequeath yourself gobs of equity as you await the big IPO or leveraged buyout or whatever.
It is all done with mirrors by fools.
23
@Brian Prioleau There was an article in a recent New Yorker about venture capital, and you have summed it up pretty well in just a paragraph. Let me know if you want to start a VC firm. I can bring an immense lack of knowledge of all those topics you listed.
12
Who would have ever thought that business that have no idea how they are supposed to generate profit would fail? I really thought the virtual ponzi scheme of eternally rising prices for stocks that can not pay dividends would last forever. You mean that people won't always be forever willing to pay more than I did for my stock, even if it's like, really cool stock?
12
@Trevor Bajus
"Start-ups that once touted fast growth are changing their tune. Brad Bao, chief executive of Lime, wrote in a blog post last month that his scooter company was withdrawing from 12 cities and had shifted its “primary focus” to making a profit."
WHAT A RADICAL IDEA.
20
How much of that $763 billion you mention came from pension funds? How about if the press stops using the meaningless phrase "start-up"? If you can't describe the business in functional terms, it probably isn't a business. Is a new dry cleaner, diner or McDonald's a "start-up"?
8
@Jim
At the end many businesses are not different than ENRON.
Uber most likely end up like Enron.
7
Advice for young start ups - bring in older workers and people with experience at larger, successful companies. So many of these companies are biased against hiring anyone who doesn't have start up experience or doesn't fit their culture
of sameness (aka, young techies). These hires will provide you with diversity of thought, expertise you don't have and people who know how to run a profitable business. I have interviewed with young tech firms and can clearly see the many opportunities for improvement they never thought of, but I can't get hired because alas - I am older, wiser and don't have start up experience.
40
Nothing new to me here - I predicted this over a year ago when I self-published "Delusional Management," my take on tech from 50 years of insider experience. (Not much interest from publishers on that one!)
Nearly a trillion dollars wasted on wet-behind the ears dudes who called it disruptive, but had no idea what a business really was. They like to "move fast and break things" as Zuckerberg says, but have no idea of the consequences of their work, nor consideration for all the people they hurt...
28
So Uber and Lyft decimated the livelihood of a lot of taxi drivers, have all sorts of issues with employees, were late to discover that there was a safety issue with drivers, and that there are might be problems with people getting in cars with unknown unchecked drivers. They then congest cities, airports, and are losing money besides. Just because someone can make an app for something doesn't mean it is necessarily a great way forward.
29
@Mike S.
But one way or another somebody has to skim the peoples hard earned money. Those people doesn't know what to do with their money.
3
Amazing how many people will celebrate demise, set backs and human misery applying irrelevant morals.
3
Sounds like a rehash of the dot-com bubble era. When are these VC firms going to learn?
5
@cathmary It's 100 percent not even in the same dimension as that. This is pure sensationalism- nothing more.
1
Anything that really changes the world will be fought tooth and nail by those who make the money now. And they can be quite effective at killing threats because they have money and money buys political power. It also buys plenty of bad press in the media for upstarts. What will be allowed is anything new that is not necessary and that does not threaten current business. Just the same as the fossil fuel industry uses their piles of money to stop green energy.
1
@Chris , Are you talking about the Pizza Robot company or the Scooter companies? Or perhaps the online mattress company? Were they suppose to change the world?
9
Oh no! Now where am I going to buy all this stuff I don't need?
10
@JLPDX, Walmart and Costco.
4
"If it doesn't make dollars, it doesn't make sense". Or how about this one, "Business for fun, is best left undone". Quit spending other peoples money and create a business that makes a profit as fast as possible - kicking the can down the road while you figure out your path to profitability doesn't work!
7
@Richard
Unless you are Amazon...the rarest of all Unicorns.
2
Yay. I’m so glad my mother and I sold our SFBA Peninsula house during the boom (so she could pay for retirement housing) rather than during a downturn but how good that it’s all being brought back to some semblance of reality. Maybe the streets of my formerly middle class town and environs won’t be filled with homeless middle class people while billionaires turn what used to be middle class homes into disgusting MacMansion compounds that no real normal human being could possibly want or afford to live in. Maybe every single local business that’s been around for decades won’t be forced into bankruptcy because the only ones that can survive are the ones that cater to billionaires. Maybe people who work for billionaires will be able to live closer to where they work, instead of having to drive for 2-3 hours and sleep in a camper by the side of the road during the weeks. Bring back the real Bay Area and get the billionaires out of town. You wonder why Bernie is winning? This is why.
35
During a two-mile jog yesterday, in an area that includes a large urban university, I counted three electric scooters flopped on the sidewalks. No Limes. Now I understand why. People figured out it's a bad idea. Sidewalks are for walkers/joggers. Bike lanes are for bikes. There are no scooter lanes. A bad idea goes away.
18
@Cody McCall should have called it Lemons.
6
Scooter providers, trivia apps, digital media outfits, online mattress sellers, robotic pizza deliverers and coffee shops -- all farfetched and essentially valueless services predicated on guesswork and manufacturing "buzz."
It's hard to believe grown-up investors toss money at these unproven start-up mayflies. Then we have Uber, WeWork, AirBnB and Lyft, et al. -- ponzi schemes that hemorrhage money and flop on Wall Street while their fast-talking "evangelizers" pocket absurd salaries.
And the lesson they take away? "Next, time, let's focus on profitability from the start." As if that quaint notion hasn't been around since the first farmer sold the first goat.
57
@Thomas I suspect most of those "grown-up investors" are "investing" other people's money. In a movie long ago, Woody Allen defined a stock broker (today it would be a venture capitalist) as someone who invests your money until it's gone.
16
@Thomas I wish I was your neighbor as we'd have a lot to talk about, well put Thomas, well put.
1
This article seems pretty over dramatic....I’ve seen REAL crises and SERIOUS layoffs and recessions before in tech (think 1999-2000 and 2008-2009), but we do not currently appear anywhere near this level. 30 companies laying off employees globally, out of how many tens of thousands? Or hundreds of thousands? The writer appears to have neglected this fact. Maybe the Coronavirus concerns might trigger something worse, but for now, I feel this article is raising excessive concern not yet warranted by facts on the ground.
6
Just because you can use a robot to make pizza, doesn't mean you should.
19
@Ed
And who thought using a $350,000 5 axis robot was a going to replace a high school kid.
Also the factory technician @ $2500 / day plus expenses for programming and repair....
4
There is no such thing as "easy money". Those who bet on that, get what they deserve.
This, Corona Virus, Climate Issues, Trump, etc. etc. 2009 was a picnic in comparison to what we will face in the coming years.
Until the greed, nationalistic stupidity and egoism is reduced substantially, there is no sustainable way forward.
5
"Uber and Lyft, which are losing billions of dollars a year,"
OK, basic one here folks, so business is suppose to make money, right? Investing based on Greed is not good.... remember the last crash.. Sad that I have to point out the obvious...Also, apparently "We Don't Work"... like that biz model was hard to figure out to be way over leveraged from the start.
So, I have this idea for a biz and I need a billion $ but it won't make any money....all the initial principals will get out with money, but the common investors will lose their shirt, also sound familiar?
4
You only have to take one look at the picture in this article of Zume & the Robotic arm making a Pizza to ask "What is wrong with this picture" ? Let me count the ways.
Or as Forrest's mom used to say "stupid is as stupid does".
Someone here said the falloff won't be as bad as the Dotcom bust & I agree. In the Dotcom bust it was basically the dancing chicken in the hidden fry pan. They were mostly selling nothing. Air. Oh excuse me - DIGITAL air. This time, there are actually a few decent ideas out there. Lime for one, shouldn't be failing. It's being destroyed by cities who can't see past their arm. And jealous entrenched business'. But for the most part - the latest boom, it is Dancing Chicken 2.0.
Erin, come on. These are SoftBank companies. 30 startups around the work have slashed jobs in the past four months? 10 startups reported getting funding this morning. Anyone that you're saying that is panicking is just trying to get some attention from you. The premise of this article is just flat-out not true.
5
@Adam Wright’s Oops, from the looks of your address, sounds maybe more like you got some splaining to do with the bank coming up. All hail the hype machine, even if you're money's at risk, doesn't sound like your heart's in it anymore.
What is missing from this analysis are they ways that gender and race have played into this VC backed tech bubble. Statistics show that a vaaaaaast majority of these unprofitable companies are the result of white men investing insane amounts of money into other white men, based on promises and perceived potential alone (often influenced by where they went to college and how many friends and advisors they have in common.)
Women and people of color have not been invited into this funding party. Only 2.2% of VC capital goes to women, less than 1% to women of color (you read that correctly) but, for example, First Round Capital reported that the female-founded companies in its portfolio outperformed male-founded companies by 63%. We build profitable companies because we HAVE TO. This bubble is essentially a case study in the ways that mediocre white men are given outsized opportunities compared to everyone else - in this case to the tune of BILLIONS of dollars.
64
@Louise McGavin Utter, absolute nonsense. Anyone with money is invited to these 'parties' - no one is refusing money based on gender or race. I often wonder what kind of people make comments like this - people who 'feel' victimized because they don't have the money the next guy does, people who've bought into the PC culture and taken it to heart, or/and people that just live on the Internet and believe what they want? Women and minorities have more rights in the US than any country in the world. And while false statistics are thrown out in the NYTimes, and FOX news, daily, it would be worth digging in some beyond the headline. No one is refusing to invest in a great idea that the owner correctly describes and markets.
8
@Louise McGavin elaborating on @Ma's point below, this bubble was also inflated by Japanese Vision Fund, itself funded/backed primarily by the Saudis.
1
The lady used figures to illustrate her points.
Do you also have statistics to back up your statements?
20
Just look at the Lime rider - blowing the wrong way on a "don't enter" street, cutting off the pedestrians crossing the street. Rude and oblivious. Like many of the hot young genius founders. Rude and oblivious to the ways of others. Managing for the long run requires something more than just being disruptive.
47
I own a small business. I have never had to “shift my focus” to making a profit. That’s ALWAYS been my focus.
18
We don’t think about “small” anything in Silicon Valley. If we did, then the backers that fuel us- the pension funds, university endowments, ext wouldn’t be able to produce enough returns for their members.
Contrary to the article, most companies here make money- ungodly amount. And they all got that way because money was burned for a large amount of time.
Let’s be very clear: there is zero similarity between one’s small business and a scaling, VC-backed tech company. Nada.
3
@Steve Cohen
VC backed companies can afford to loose money for 5 years or more while raising ever greater amounts of capital. So testing the money generation thesis comes pretty late in the life cycle of the company only after build innovation, scale and then sell [may be].
You would never do that with your own money unless you are a Billionaire that can afford that kind of bets.
2
The article is highlighting the many issues with companies of the “gig” economy. Massively over valued, bleeding money, while shifting risk to “contractors,” while paying execs millions.
What small business owners like myself get annoyed with is that we pay our employees a good living wage, we pay TAXES, but these companies can’t be bothered to follow the rules or have any ethics.
If the only way your business has a shot at turning a profit is paying people below a living wage, sidestepping labor laws, lobbying for labor exceptions for your business, then you don’t have a real business worth pursuing, and it’s unethical to continue.
7
We learned all this in the dot come bubble of 2001/2002 - but apparently forgot all the lessons. What startups seem to not understand is that there is a difference between Amazon ploughing back profits into the business in order to expand and a startup never, ever, having had profits. Most of these startups have non-profitable ideas that get financed by venture funds, but ultimately, without profits, you got nothing.
2
Many of these "tech companies" have almost nothing to do with technology. We Work? Cannibis? Electric scooters? How is any of that more "tech" than regular old shops and cars? How much upside potential did they really have? It feels like they were just trying to give themselves a patina of techiness to juice their valuations beyond what a more sober, realistic assessment would have justified.
15
@M I love the way half of Silicon Valley “tech” is just plain old retail with an internet twist. Nothing to do with technology at all.
5
It appears we have finally arrived at Peak Scooter. Just in time, before more pedestrians are whacked from behind by these speeding techie toys.
We also have the answer to the perennial question, "But where do find the money to pay for [your basic public service that Wall Street hates]?" We now know that private investors have squandered over 700 billion dollars misallocating resources to dubious to useless and harmful enterprises pushing products nobody asked for, some of which have never made a profit.
That investment could be redirected to provide the things that millions have loudly demanded, needs that seem never to be met: healthcare, housing, education and child care.
20
@Matt
Thank you! My thoughts for a very, very long time.
Sometimes the US economy seems built on a pile of hype and greed.
8
It's the rate of profit, or return, on modern parlance. It has been declining in the productive sector, or the one that really counts. The fictitious sector, the financial one, can only prolong the con for only so long. Industrial production has been in recession during the last year, both in the US and Asia (except China, which is rapidly declining as well). In the end, it inly living (human) labor that creates value and the surplus (appropriated by non productive sector like finance). When living labor relative to dead labor (or machines and technology) decreases to a limit, so does the rate of profit for industry in general (despite the appearances of the market)
3
Okay, take this comment in broad strokes - theme versus specifics:
Lots and lots of “dry powder” (investable funds) swirling around needing any place to land (investors don’t pay management fees on un-invested capital after the first couple of years). So there is tremendous pressure to invest - and to rationalize the hyped returns on PowerPoint investment presentations.
Too much money - too much waste (lack of serious vetting and scrutiny).
Let’s delve into this. How about we look at why a lot (not all) of this dry powder exists. Much can be sourced to one of the most developed, pervasive, and lucrative industries - Tax Avoidance. A billion (or more) dollar industry employing 10s of thousands of lawyers, accountants, administrators, advisors, assistants etc etc to create quite a bit of the mountains of “free” dry powder that ends up drowning out real innovations with wasteful half-baked cocktail napkin schemes.
Given that taxes are the membership fees we all pay to be members of our country (no comments on this, as you’ll be missing the point), why don’t we focus on oversight of how our government allocates tax revenue (membership fees), rather than condoning the industrial level free-ride that those who avoid their taxes (yeah, we all know it’s legal). So instead of us all having funds to repair and maintain our infrastructure, amongst many other common goods, these membership free-riders waste billions on nonsense ideas in the sacred name of “innovation.”
20
That’s what’s up!
A new frontier was discovered.
Pioneers moved in, and a few succeeded, becoming 800 pound gorillas.
They bought up some of the smaller players and squashed some of the others. A few smaller players managed to survive to become medium players.
That frontier is settled.
Rinse, repeat.
9
Each of the businesses mentioned has unique specific problems.
Uber and Lyft, as noted, are losing billions of dollars a year and have recently been subject to legislation, which if upheld in court, would upend their independent contractor model. Their IPOs may have disappointed the hopeful, but were hardly surprising.
WeWork's attempt to brand office space rental, a business that has been around forever, was always a risky proposition, made riskier by an irrationally exuberant CEO blissfully disconnected from financial reality.
Casper, the mattress firm, no longer had a unique product. Bed-in-a-box mattress firms having proliferated, with offerings now available from the established players. So low barriers to entry and competition undermined expectations.
And Lime was reigned in by regulations from cities who would no longer tolerate scooters blocking their sidewalks, along with vandals who dumped the scooters down hills into rivers, lakes, creeks and streams.
This might be the start of a correction, but the loss of 8,000 startup jobs over the four months across the entire planet is hardly a tsunami. It's a blip.
12
@Robert M " the loss of 8,000 startup jobs over the four months across the entire planet is hardly a tsunami"
During the last bust we used to lose that many in a single week.
5
@mlbex Great observation. HSBC has announced that it will cut 35k jobs globally. I feel sorry for those that will lose their jobs, but it is part of a dynamic, competitive marketplace. Not every startup will become a facebook or amazon.
2
@Robert M Reined (think horses)
As a long term SV veteran, I can assure you of a couple of things. 1) Many of these aren’t even tech companies. 2) Our most important commodity, labor, was grossly misallocating technical talent to these, making it that much harder for actual tech startups to hire the right people. 3) We depend upon deflating pockets of air every now then. It’s essential for the ecosystem’s health 4) Let’s be very clear: the larger tech industry is doing just fine. More actual money is being made than at any point that I’ve seen in the last 20 years.
22
When the Pizza Robot can make the milk for the cheese and we can free the imprisoned cows on dairy farms, then I will be happy to invest
12
Now if we can just get rid of the man bun.
21
Just because it is "tech" and a "start up" and "disruptive" doesn't mean it's good for us.
29
Tech may be the future, but aggressive funding and reckless expansion in the face of constant profitability questions has never made much sense to me. The current state of affairs aligns with logic and reason, which sometimes is a better guiding light then speculative investing.
6
The 'technology' companies Ms. Griffith cites are gadget-fad companies. That is to say, they're not delivering fundamental technologies. Many were never well thought out, and so appealed to the not-so-well-informed crowd.
For example, Zume relied on automation to make pizzas. I designed a robotic pizza toppings dispenser for Schwans in 2000. At that time Schwans learned that automating the pizza process at the retail level does not provide a sustainable business model. Human help is pretty cheap, and the automation is expensive and inflexible. This knowledge was soon available to the entire food industry. Why Zume never learned from Schwan's mistake is a complete mystery to me. Evidently, they failed to inform themselves of the problems with their business model, or they were deliberately given a red-herring to dispose of start-up competitor. They were certainly clueless as to the automation.
As for the inner-city scooter market, that was ill-conceived from the moment it happened. It's a fad, and fads soon burn out. It's not, and never was, a fundamental mode of transportation. Inner city sidewalks are crammed with anti-social skate boarding types with no respect for pedestrians, including the elderly and the disabled. These scooters are tantamount to a license to bully the common public. And they tend to clog up the bus stops...a real irritant to those who ride the bus and generally can't afford them (or the requisite smart phone). Goodbye and good riddance.
33
The original idea from Zume was that the pizza finished baking on the delivery truck. This provided the customer with a hot, fresh pizza at their door. Additionally, as they robotized the process, they sent their employees to college to learn computer skills and then put to work with better knowledge to maintain the robots and software. I thought it was a great idea and
3
That business model is entirely doable with human employees making the pizzas and putting them into electric ovens in delivery trucks. Not sure why expensive robotics need to be part of the plan.
And how many pizza workers are secretly frustrated software programmers/robotics techs? Most of the pizza makers I know have English or History degrees ;-).
Finally, as all New Yorkers and New Havenites know, if you want hot, fresh pizza you deliver yourself to Pepe's/Sal's, not the other way around!
5
@Thoughtful Citizen Doesn’t sound like a great idea to be honest.
1
Uber’s reckoning will one bit later - and be much bigger.
4
These companies all have one thing in common. Voodoo economics. Perfect for the trump view of the world where facts no longer matter.
22
Like tuition-free higher education for all Americans, we need leadership at every level of government to "get" the idea that innovatoin through small company startups is essential to long term growth and viability and that the massive push for monopolization since Reagan is crushing one of the greatest strengths of our nation.
Startups should not only pay any taxes, but they should also be subsidized and organizing bodies and coalitions should be created to bring startups together to share and synergize technologies.
There is so little "leadership" in our so-called leadership. Hopefully, Andrew Yang gets involved in the next generation in a big way.
Startups are essential and they should be supported and not just by venture capital looking to make money but by a nation looking to create opportunity and competitive capabilities for the future. innovation
1
@Tom Paine No, startups generally started by and for the benefit of 1%ers, that destroy mature companies with nothing more than cheap capital to subsidize their lossmaking and help them gain monopoly status, should not be subsidized. Are you serious?
11
@Tom Paine Let me see if I have this right: startups should not pay any taxes, but the government should pay for college tuition for everyone, and also subsidize the tech industry. So, who is paying the trillions of dollars in taxes that it would take to make this work?
Unfortunately, not everyone can work for a tech start-up. Some people will still need to grow your food, and transport it, and police your streets, and provide your electric power, and drive the buses, and care for you when you get sick or old, etc etc. It’s unclear to me why all of these people should be excited about a future where they’re paying for somebody else’s kids to go to college and then work for a subsidized start-up that may or not provide any benefit to anyone other than those who earn their tax-subsidized wages.
The problem with the tech industry is that even the companies that succeed tend to benefit only a relative few, and the companies that fail waste billions of dollars that could be used to build roads or house homeless people or other things that would be useful to society in general. Not to mention the fact that many of the industry “disruptions” caused by tech start-ups tend to put people out of work.
If anything, it would make more sense for government to impose taxes and regulations that funnel money away from the tech industry and into sectors that have a more widespread public benefit.
3
@Tom Paine ,
You are confusing Research with Startups. These days research for the sake of better understanding the world around us is not supported (some universities excepted). Startups are supposed to become profitable and not do technological research.
It used to be that IBM, Bell Lab, Xerox and the like invested in basic research. Since Wall Street got involved they mostly stopped. If it does not produce immediate and potentially money making result research is not funded. Professors need to find sponsors from the industry or contracts with firms, otherwise there is no budget fr anything.
1
To all those who say you have to be profitable from day one - think of Amazon who didn't make any money for decades.
4
@bill Not quite right, Bill. It was profitable after 7 years.
6
Profits? PROFITS?
We don't need no stinking profits!
13
Don’t worry, the profits will not be shared with workers.
1
Check out that pizza company. I watched a video overview, and they talked about having a 6 axis robot to take the pizza from the conveyor to the oven. Overengineering to its finest, a correction was clearly overdue.
18
@Greg Using a chainsaw to cut a bar of butter, as Stewart Brand used to say.
2
Robot Pizza is ridiculous, anyone that invested money in that was unfit to have money in the first place. Dotcom bubble redux, it's about time.
32
Somehow, not to be able to make money in business has come to be idolised as some kind of astute foresight. There are also a lot of suckers with money to throw at such ideas. 'Angel Investors' burn up other people's wealth in dubious scams. It is sanity that Stock Exchanges are still hard-nosed and call the bluff on IPOs.
7
I am sure that a lot of startup companies are doing okay, but this serves as a reminder that not all good ideas are successful deals. New businesses are high risk, whether in technology or any other field.
I wonder where the next $763 billion in investor money will come from once president Sanders or Warren jack up taxes on the wealthy, the ones that supply the seed money. They want to take the capital gains rates up to ordinary income tax rates, add social security and medicare taxes on top, increase the ordinary tax rates, amd then tax assets. Does anyone seriously think that all that can be done without repercussions elsewhere such as investing?
2
@luxembourg cry me a river regarding "venture capitalists." There was plenty of investment in the U.S. for the last 100 years (no matter what the tax rate was on the rich). I don't see the wealthy providing basic seed monies to regular folk to start simple businesses. What, not sexy enough? What, not "profitable" enough?
25
@mrfreeze6
"I don't see the wealthy providing basic seed monies to regular folk to start simple businesses."
That model has been implemented with some success in the third world, but it has nothing to do with an advanced economy.
Virtually anyone capable of successfully running a small business is also capable of raising the modest start-up capital required for such an endeavor.
3
@mrfreeze6 Actually there is a lot of money going into helping regular folks start and grow businesses. Africa and Asia are huge beneficiaries.
1
This is not such a bad thing. Time for a "reset". Companies need to get back to basics. And by "basics" I mean make a profit. I mean really, I am sure that I could lose money with the best of them, but that hardly defines me as a "visionary" or "superstar businessman".
6
Wework was low tech. The main drawing card early on was free beer in the buildings they rented.
Alcohol was big player with the founder, Adam Neumann, who was well known for his love of, and constant drinking of, expensive tequila.
8
Gasp, a correction! Seriously, the tech industry goes through boom and bust cycles pretty often. While this is news, it's not OMG NEWS.
I've worked in high tech over 30 years. There have been many "haircuts". Even without significant corrections, most startups fail; they're like new restaurants. Also, I have never worked for a high tech company that didn't have layoffs of one size or another, generally at least once a year.
If you've worked in the industry for more than a handful of years, this is just business as usual.
16
I hope this is a wake up call. A lot of these companies are built on questionable ideas and beliefs about people’s behavior and future markets. It’s too bad a lot of money invested in bad ideas isn’t put toward real needs and solutions to ever growing problems.
10
This is just the tip of the iceberg. This tech bubble was fueled by super low interest rates. When you can borrow huge sums of money at very low rates and put them into a business with even modest growth, the profits can be immense. The problem comes when those bets don't pay off and people can't repay their loans and fear sets in. We've seen this act before.
13
@Mark, most of this boom wasn't directly fueled by low interest rates. Rather, it was likely a search for yield that sent investors into private equity and other investment vehicles that then invested into these start ups. The same search for yield also has investors dumping money into corporate bonds and waiving protections in junk bond contracts. That's where debt will blow up. Coming soon perhaps.
This is a good thing. This correction had to happen sooner or later; one hopes the "strong" economy can absorb this without setting off the coming landslide. Better to let the bubbles pop as small bursts here and there than all at once. Let's hope there isn't anything like the mortgage derivatives bubble in the works.
10
@Dan
For certain if the bubble bursts on DJT's watch, he'll blame it on Obama.
9
Tulpenmanie redux. The next segment to see the purge is Data Science and Machine Intelligence startups once we actually do some good science. Kinda like how the alchemists were out of a job if they couldn't do chemistry. We don't need a lot of people, we just need a few smart ones.
7
I work in tech and yes, this seems so familiar. It's like the dot-com bust almost 20 years ago. Does the business community really have such a short memory?
15
@Scott : Just before the dotcom bust, there was a telecom bust. It took out the IPO that was going to make me rich but was still in lockout. I had to work 20 more years.
Tech cycles come and go.
7
@mlbex I'm sorry you got burnt, as did many of my colleagues. It was a really strange time!
I'll believe a robot can make a pizza when I see it flip and spin the dough in the air, otherwise just program it to spread tomato sauce on cardboard.
11
A lot of these startups absorbed the wrong message or developed the wrong conclusions about their industry regarding first-mover advantage and barriers to entry.
That is, most of them were in industries where second-mover was just as valuable as first, and the barriers to entry are actually pretty low, so those losses they thought were going to turn to profits never did.
6
Sure, everything is cyclical. What's new?
The long term cycle in tech is still upward. That's where the world is headed. Will there be a correction? Absolutely, overdue. But, tech is still where it's at.
10
Photo says it all. Guy riding a scooter the wrong way down a street posted with a Do Not Enter sign. He looks as though he’s about to run over the people in the crosswalk. And he’s not wearing a helmet.
112
@Ziggy
Brilliant catch, thank you!
Seeing that detail turns this photograph from standard newspaper filler into an iconic cultural statement.
17
@Ziggy The only thing that would be more apropos of Lime scooters would have been an unused scooter placed horizontally across a narrow sidewalk. Urban scooter-shares can't go away fast enough.
26
@Ziggy
And I just noticed that the guy is wearing earbuds.
19
It was totally predictable. They were far too many of them selling one and zeros with no tangible assets and with very limited experience. This coupled with the corona virus, global warming and the debilitating slow dawn of all the world's economies we will be hit with the worst economic collapse the world has ever known,with no plan of how to deal with it. We are in for the fight of our existence,Thanks to unbridled thoughtless capitalism and the profound indifference to our physical world.
19
@JG ... I hope so. We deserve it.
Odd. I work in tech senior management. I can put my resume out in any tech city and get 10 emails a week for hire. I am wondering where this is happening. I make more than my wife who trained for heart transplant till she was 37.
7
@Scott : Odd. It seems like the managers in these failed companies should have seen this coming and prepared. Maybe you can turn a company like WeWork around and make it profitable.
1
@Scott "Ι make more than my wife who trained for heart transplant till she was 37"
That's the problem right there
22
@Panos Some managers seem to think they're God's gift to the industry until it fails, then "it's just a cycle."
8
The general idea of all these companies was to sell every individual service or item at a loss, but to make the loss up on volume.
That's a really old business joke, but in this era, quite a spot-on description.
36
@The Poet McTeagle
Really old ! I remember my dad telling me the "but make it up on the volume" punch line back in the mid-1950s. As a very young kid, it sounded just as surreal to me then as it does today.
3
At some point, tech becomes a commodity, like phones and laptop computers. Then companies can make incremental improvements, but the next big thing doesn't happen. Stable companies continue to produce similar products for those who don't have one yet, but there is little need for unicorns or startups.
At that point, all the investors seeking a return on their investments realize that the risk is now greater than the potential reward. The hot new industry has matured, and the hotshot programmers with their $6000 a month rents have to on something that isn't as exciting, and that pays less.
It's a cycle. It has peaked. It will go to a trough, then just maybe, it will come back again.
13
Every start up listed in this article requires intensive capital, has costs associated with selling an additional unit, and no path to profitability. None of the companies listed in this article have zero marginal costs, a key indicator of a technology start up that can make a profit. That ignores startups that are actually doing well, like SaaS startups. Take a look at Zoom Video Communications, which IPO'd in 2019. Its stock is up to $109 having opened less than a year ago at $62.
16
Excess money will always seek a low cost way to get washed.
9
As a native San Franciscan, I can only say that bursting this insane bubble can't come too soon.
May the humbling continue for a long time.
77
@Anna
As another native San Franciscan, I thank you for expressing my feelings/thoughts on this subject. They are shared by every other native of the city I know. (and yes, natives of SF do exist.)
21
Does a startup AI system conduct the layoffs?
15
Robot-pizza-making-delivery service. Throwing bad money after even worse ideas. How about taking that $400 million dollars and investing it in the lives of working-class folks. Maybe if this was done, we wouldn't have so many people voting from Trump because he, "hears their pain."
50
@East Roast to be fair, doing that doesn’t profit the private investor. If you want to make money with your cash, gotta invest in a business of some type. Clearly not these businesses, but you get the idea. No need to virtue signal.
1
@Greg stop with the weary cliches.
2
as reflected by the headline here, a big part of the problem was (and still very much is) this belief in an idea of something called "tech" as if that is its own self evidently "good" thing, with it's own value, independent of any real human context - it's not just a problem for investors, it's a problem for human civilization
19
Always amusing when these guys discover the concept of "profitability".
45
This is what happens when you concentrate wealth for 40 years. The 1% have hundreds of billions of dollars to toss around carelessly, spending on ridiculous things like businesses that don't try to make profits, while the 99% can't even afford to live in the cities.
The bust will come as usual, and when it does the rich will recover and the poor will get poorer. Rinse and repeat.
We could go back to taxing wealth again and fix it all, but that would require admitting that trickle-down was a scam, and no billionaire will ever admit that.
128
Some of the comments here underestimate the cynicism of some of the so-called tech 'unicorns'. As far as I can see, Uber's business model from the beginning was to provide a grossly underpriced taxi service, burning investor money, long enough to drive traditional taxi companies out of business, at which point it could raise prices enough to be a traditional taxi company (with self-driving cabs some day in the hazy future). Why this was seen as a multi-billion-dollar piece of brilliance escapes me. And I also still don't get why I would want to get my local transportation in a random stranger's car, with an underinsured and undervetted driver, and unstable pricing. Yeah, the price was low (thanks, sucker investors!), so that drove it, mostly, along with many workers' willingness to self-exploit, but the business model HAD to be to bankrupt cabs so that prices could then rise to cover actual costs, right?
145
These are not tech companies, Microsoft, Oracle, Google or Invidia are technology companies. These are companies that use technology to sell old school products. One would think that Casper with direct to customer shipping would at least have a cost saving niche that would lead to profitability. But, there are a lot of companies that sell mattresses online. In fact, almost all of them do now. A pizza making robot company? Really? The 20 year old making slightly above minimum wage is to expensive? Even if the claim was it would revolutionize the pizza industry, is it really something that needs that much disruption? Isn't Quora just Ask Jeeves under a different brand? And lest not forget WeWork, which is a commercial leasing and property management company under the auspicious of tech. There is nothing tech about WeWork except that you can rent space online. Or Peloton which is a sexier Nordic track with a better playlist. The food delivery companies are at a race to the bottom in pricing and will get much more expensive as they seek profitability. I see this consolidating into two players Ubereats and someone else, perhaps grubhub, postmates and doordash will combine to form mega-delivery! The scooter companies are running into legal issues. What city wants the streets littered with these infernal contraptions? Finally, with a majority of these startups there are no barriers to entry, because they are not creating their own technology.
117
I fully agree. Back in the late 1990’s tech companies were losing money at amazing rates to capture market share. Then everything came crashing down. Afterward, I read that investors were putting money into companies that could turn a profit. Those lessons seem to have been forgotten, and subsequently had to be re-learned. Maybe what we all need is history classes, so we stop wasting time repeating the same painful mistakes.
28
@Johnson I was about to write my own version of this comment, when I suddenly noticed this one. It gives a very precise assessment of the real situation.
9
@Johnson You nailed it my friend, I would even argue Facebook is not a "tech" company, it's a bulletin board riding on a distribution platform (WWW/Internet). People posting videos of chickens playing the piano or over-sharing their existence under the pretense of "friendship" is laughable when you consider FB does nothing more than lower most people's productivity. Where exactly is the "tech" in Facebook? It's revenues come from ads that target key words and themes in your postings. Basically, FB is excellent at combining and posting what used to be called "rich media". Excessive quotation marks aside, innovation or tech as it's called all day long, will live up to its moniker when solves a legitimate problem, for example - pace makers, electric cars, and ready for this? The wheel! But Robots making pizzas? Electric scooter companies who can't be told what to do on our public sidewalks and streets? More vetting on the part of VCs would help when someone says, "The concept is simple, you can grow a garden on the side of your pants if add more pockets, but the real money is in selling the seeds and the pocket mulch. Now everyone can grow tomatoes or herbs even if you wear lederhosen, I'll need $30million for R&D, oh, and I forgot to say please, so please n' stuff?"
20
Getting that deja vu feeling all over again. Explain to me how the CEOs of money-losing companies are billionaires? Yeah, something is wrong here.
89
VC firms basically play the lottery. Most of it is cotton candy instead of food.
23
The problem is the public's and government's expectations relative to start-ups. Typically, they address a highly specific technical or medical problem. A small group of technologists attempt to attain a verifiable proof-of-principle and then protect the intellectual property (IP) developed. That IP is then marketed to potential licensees. The team of inventors then reap the rewards of the invention via royalties, license execution fees, etc. But then, just like the Beatles, they break up. The notion that start-ups increase employment has always been essentially false. A team forms, a team invents, a team protects the IP, a team licenses the IP, a team reaps the rewards (or not), the team dissolves. There's no GM production plant at the end of the start-up rainbow. Period.
15
@ D. Agreed! And let's add to this list the Revels, an electric motorcycle, which are now proliferating in Oakland as a "test city" (lucky us!). These things get dropped off in the dead of night, I think, because I never see how they show up on our streets. They're just there one morning, though I've only seen one person actually driving these things around the city. Hopefully they're headed for the Lime/Byrd, etc. graveyard.
9
I’ve been pretty happy with them even when transitioning to car ownership I find them useful in Brooklyn, their first location. Unlike what I have seen with Lime, they need to follow traffic and parking laws, which as the user, you are liable for all tickets for 24hrs. This controls how they get placed.
2
@Rob K You have a point there, in that Revels require a driver's license to start but insurance? And while Brooklyn might offer a better test environment, the Oakland neighborhoods where these are placed are residential areas where everyone has a vehicle anyway. And you can't take these across the Bay Bridge to commute to your tech job in SF. They are not being placed in the lower-income areas of Oakland, of which there are plenty. Or how about they get stationed at the many homeless encampments here?
4
Looking at the graph of investments posted with this article, it looks like we are coming directly off of a record high number of investment. Furthermore, the last time it hit such low levels (in 2016), the number of investments pretty quickly bounced back up.
Just based on this, it seems premature to state that tech start ups are facing a moment of reckoning.
3
Anything that halts the proliferation of scooters, which block sidewalks, is welcome in my book.
54
As someone who lives pretty much in the middle of tech I can only see this as a breath of fresh air. Recalling the last tech crash, the whole city of San Francisco suddenly became livable again. Idiotic oversized cars parked on top of one another disappeared overight, housing opened up, the excruciating arrogance of it all jjust went away like a puff of smoke. Bring it. Im not saying that to be cynical. Hopefully some of those people currently still salivating over the next unicorn will find something actually useful to do with their time, like make and deliver a pizza.
164
@Erich Richter You say it! And amen.
3
@Erich Richter I've lately noticed somewhat less congestion of both pedestrians and vehicles in downtown San Francisco. Maybe the current tech takeover of this beautiful, unique city is indeed reversible, and people who love San Francisco for more than money will get to enjoy it again with fewer reminders of greed and arrogance.
I sympathize with the people who will suffer financially when their startups fail, and hope they find other work in the realm of reality. When and if they do, I also hope they'll remember with compassion all the San Franciscans they displaced when they thought the sky was the limit.
4
The Coronavirus should be a boon for the robot cafex. Think how little cross contamination there is - none except for people tapping the screens to order the drinks. Perfect in airports - just make drinks orderable via an app!
I love the coffees I’ve had from their machines.
2
Softbank deserves everything it gets. The business model is to buy up companies, wring them dry of cash and lay off on a grand scale. They've been doing it for years. Then they sell off whatever is left. This time they've been left holding the bag with no chance of a quick churn. Son-san has extended himself too far this time around.
33
Oh, no! Say it ain't so! The purveyors of useless junk have run out of steam. Where will the hucksters go next?
60
@george eliot
Unfortunately, they will do what they did last time, move into urban real estate and replace what's left from the latest real estate bubble of trees, yards, open space, and decently priced housing with more luxury buildings that no one can afford or that will remain empty until they've appreciated enough to be flipped.
11
The stock market became insanely overvalued - unstable and ready for a deep correction. I thought Trump's insane debt and trade war would be the catalyst but it turns out the COVID-19 pandemic has kicked the legs out and it's coming down like a jenga tower. These startups will be buried under the debris. By 2021 there will be nothing left but lawsuits and memories.
40
Somewhere Isaac Asimov is shaking his head for those poor unemployed robots.
“Some start-ups are even laying off the robots. Last month, Café X, which operates robot coffee shops and raised $14.5 million in venture funding, closed three stores in San Francisco. Henry Hu, its chief executive, said in an email that the company had “learned everything we could” from the shops and now planned to “laser focus” on airports, where it has two stores.”
11
The race is to get cash flow positive folks...don't ever lose sight of that.
7
The upshot is that this how innovation works in the tech industry. Just look at the graph and you can see the peaks and troughs. If a trough is coming now, a peak will be sure to follow and then the news will be of a very different tone.
4
Just because a company uses the web or an app doesn’t make it a tech company. Uber, Lyft - are essentially taxi companies, WeWork - an office leasing company. This is unlike Google or Apple or even Facebook. Part of Amazon is a retail company while parts of it are a tech company. While tech companies such as Google or Apple have huge profits, Uber and Lyft are stuck with all the inherent limitations of running taxi companies.
79
Of course they’re tech companies. Their entire business model is built on digital foundation. Shut off the Internet and Uber doesn’t exist, nor Amazon’s delivery service. Meanwhile, McDonald’s would still be serving burgers. See it now?
10
@A. Raymond You re incorrect. Uber an Lyft are not following labor laws and paying living wages, and they are actively working to dismantle protections for workers.
They think they have no limitations...that is the problem.
26
@A. Raymond I've read that Amazon is essentially a shipping company.
1
As a small business owner (call me a solopreneur), I’m shocked that the concept of “being profitable” is so novel for the vast majority of startups and investors alike. It’s akin to a person with a large trust fund thinking they know how to be financially independent, even though they were simply given the money rather than having earned it. Having the funds is one thing; staying solvent is another.
126
@OaklandMama Hmmm - sounds like a familiar story - son gets bankrolled by his wealthy father, then his companies stiff vendors and declares bankruptcy - then a new shady partner shows up and rescues him - and then he becomes president in a dubious fashion. I can't think of his name, but his initials are DJT....
23
@OaklandMama Yes, just ask Trump, whose daddy gave him $40M, yet he managed to bankrupt casinos! Such a genius--at dodging taxes, paying bills and building at huckster brand.
15
@Kilroy71 I think the total was $400M+
16
Having been a startup guy fresh out of school who scrambled to get through the first tech crash -- which led to the last recession -- I can say with 100% certainty that it is now happening again. As long as investors fail to adhere to the basic fundamentals of wise investment -- and even knowingly go for companies that are just a straight-up investor scam, like WeWork -- then we will have this boom-crash problem. A few guys will get really, really rich, but the vast majority will lose their jobs and the entire world will suffer for it. We need much, much better regulation of the venture capital market. It's mostly a get-rich quick scheme and very few of these companies ever attain profitability because they had no plan in the first place.
144
The last recession was not due to a tech crash. It was due to risky lending, a belief that real estate prices never fall nationwide, and financial instruments that supposedly protected investors from risk. Remember all of the foreclosures and the trillion dollar rescue packages for the banks? Not due to a few tech startups not turning a profit soon enough.
29
@Brannon Perkison With a 100% certainty I am assuming you are shorting the stock market then?
@adam LOL! No, I've mostly stayed out of it altogether, except for the companies I work for where I can be sure there's an actual product.
1
Remember the words of George Santayana, "Those who cannot remember the past are condemned to repeat it."
We live in a great country at a great time, especially for science and technology. However, sound business principles are timeless. Finally, if it sounds too good to be true, it probably is. How many of these companies really work to make their businesses sustainable? When every great new company comes on board, creating a crowded field, what are you doing to distance yourself from the competition?
12
The truth is all these tech companies sound like junior high school projects. My idea, however, is an iron-clad money maker just waiting for investors: socks that find themselves.
231
@Loud and Clear What happens if you lose both socks?
15
@Loud and Clear
My socks always know where they are. They just don't tell me.
39
@Loud and Clear
Or embrace mismatched socks
5
“Brad Bao, chief executive of Lime, wrote in a blog post last month that his scooter company was withdrawing from 12 cities and had shifted its “primary focus” to making a profit.”
Welcome to adulthood. A culling of start-ups sounds like a necessary evil for the economy and the cities that have been adversely affected by this get-rich-quick industry.
69
@Brooklyn Dog Geek I don’t want the scooter companies to make a profit, I want them to go away for good.
5
this all smacks of reverberations from the all-eternal past-presence-future
2
These companies illustrate the difference between an idea, a company and a business. Real businesses solve real problems for real people in a way that is sustainable. The intellectual dishonesty required to even remotely think something like robot pizza trucks, easily stolen scooters, or over-priced rental poorly decorated rental offices are a solution to actual problems is astonishing. There are real problems that can be solved with creativity and capital - and generate real profit, rather than self-congratulatory valuation. Maybe this reckoning will inject some much needed funding in their general direction.
119
Everything old is new again. This story is not a repeat of the 2000 tech bust, or the 1980's AI Winter, or (insert hyped tech market in the past). Welcome youngsters to the reality that the successes in Silicon Valley stand tall on the corpses of busts, bankruptcies and failed startups.
20
I continue to be amazed that NYT writers state that a stock price dropping after initial offering is somehow bad. All that says is that the investment bank totally misgauged the market and priced the stock too high. If the stock opens at $100 and goes to $80, that was the investment bank's fault. If it opened at $70 and went to $80, that is also the investment bank's fault, as the company now got $70 per share when it could have gotten $80. This is basic finance. Known for decades.
Now, it would be news if, say, for the past year, the company had been expecting to get $100 per share, and then the investment bank valued it at $80 and the price was stable there after opening. But writers rarely make that case. They look at the price trend on opening day, which only tells us how good or bad the investment bank was.
48
Industries have successful start-ups when they are young. Then industries mature and are dominated by a few large players that no one can compete with. The start-up phase moves into the past.
We accept that the start-up era is over for the railroad, steel, and oil industries, etc., but we won't accept that it is over for the tech industry. Why not? Just because we were alive during the tech industry's immaturity?
Time to accept the inevitable and move on.
6
@Polaris Tech isn't really a single industry like railroad, steel, and oil; it plays in every sector of the economy. Some areas served by tech are indeed mature with dominant players, others are nascent.
8
As a small business owner that has to make a profit, I'm personally thrilled by investors pulling back on some of the more insane ideas.
What I'm curious about is where these same investors are putting their money, instead. With US interest rates at historic lows for a historic low time, what else is there to invest in that earns a reasonable rate of return in the US today?
20
I don't want anyone to lose their job
but they notion that all these new companies
could some how be valued at millions and billions
when few of them were actually turning a profit
makes those who believe in Trump seem far wiser
than those who trusted in this new way of doing business.
I feel sorry for those who bought at the top of the
Housing Market in Silicon Valley and SF,
as no one is going to buy your bungalow for 1.7 million dollars.
9
@John Brown
This really is not a new way of doing business. In the 1990's, tech companies claimed there was a new paradigm which traditional investors did not understand.
Apparently the new wave of money managers forgot the lesson of the 90's. Sooner or later, if you do not make money, bad things happen.
Funny you would tout Trump as the image of stability. His business enterprises exist on borrowed money and he comes across as mentally ill in his public and personal behavior.
134
@John Brown Trump's way of doing business was to borrow and spend, pull money out for himself and his family and then file for bankruptcy. Granted, for the last few years, Trump's new way has been to raise his prices and charge the government the cost during his many visits, thereby directing hundreds of millions of tax dollars to his properties so that he can pay back his loans. These are not "old ways" of doing business. These are simply the ways bad people do business.
57
@John Brown Don’t forget they population will keep growing.
1