Jenniferplusplus
@danilo I think you're overestimating what pharma spends on research and regulatory work, but ok, let's ignore them.
All these other sectors with enormous growth potential + low and falling infrastructure costs still don't react the same way to interest rates. It's not the interest. It's the lack of counterbalancing power.
Jenniferplusplus
@danilo Pharmaceuticals are dirt cheap to manufacture. The bottom fell out of the manufacturing cost for renewables a decade ago and we still haven't hit ground.
To answer my own question, I think the difference is that venture funding has produced a binge/purge staffing dynamic in tech that has nothing to do with interest rates. That binge/purge was the main driver suppressing labor power, and pandemic lockdowns broke the cycle.
Danilo Campos 🇵🇷
@jenniferplusplus pharmaceuticals are dirt cheap to manufacture after YEARS of research, studies, trials, and regulatory approvals, and other adherence to protocol
all requiring YEARS of specialist study and advanced degrees
You're allowed to modify and impact humans without anything close to the same level of scrutiny or oversight in software. These economics just aren't comparable, even if the long term margins are competitive
Danilo Campos 🇵🇷
@jenniferplusplus none of those have the low marginal cost scale advantages of tech. Hell, renewables and pharma require manufacturing.
Automating middle management and taxi dispatch in San Francisco can scale to as many cities in the world as you can manage to capture. VCs can sell you metastatic growth
Jenniferplusplus
@danilo Finance, biotech, pharmaceuticals, and renewables had at least similar prospects. What's different about tech?
Danilo Campos 🇵🇷
@jenniferplusplus I think the concept of ZIRP argues that venture funded tech had unique dynamics for its growth potential relative to other sectors, which is why money raced in abundance and even stupidity
And it was this abundance that created certain strategies that are no longer valued, while influencing behavior from FAANGS who had to compete with startups more aggressively for talent as the money flowed
Jenniferplusplus
Hey, question: If the "phenomenon" was due to the zero interest rate, which is the same for everyone, why don't we see the same patterns in other sectors?
Jenniferplusplus
Cannot tell you how much I hate the word zirp. Also the concept. Also the willful blindness to the nature of power and capital that it requires to be satisfied with "zirp" as an answer to questions about why venture capital backed firms act the way they do
Jenniferplusplus
@mattly @danilo Yeah, but capitalists aren't stupid. They know that's true. They do it anyway because 1) it means they'll be in control of it if it manages to become ubiquitous; they can and will enshitify later. And 2) it keeps people from building things that capitalists won't control.
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