>This makes me ask an even more fundamental question: is the structure and business model of most VC firms today unfit for solving complex problems sustainably and long-term?<p>Was it ever actually fit for that? The VC economy basically always served one type of company, consumer-focused "lifestyle" or service 'technologies', and nowadays a lot of the institutions like a16z just appear to turn into straight up media outlets.<p>VC success in the industrial sector, biotech, military or scientific applications has always been muted compared to the kind of money that flows into the leisure/consumer/entertainment economy.<p>If you want to solve complex problems bet on Darpa or academia or bring back the corporate research lab whose demise is one of the real big problems today.
VCs are just cogs in the wheels taking us from an "Ownership Society" to a "Sharecropper's Society," as Buffett once put it. Private Equity buying up housing, is just the latest worrying trend in a troubling trajectory with excessive debt, centralization of power, concentration of wealth, etc.
I don't know about Europe, but in the US a lot of this relates to the fundamental inefficiency of the suburbs.<p>In NYC already, paying smoeone on an e-bike to deliver 10 meals in one short trip is way better, but why stop there. There is no reason we cannot bring back the old pneumatic tube delivery systems of yore (and expand them according to 100-year-old sci-fi too).<p>Conversely, none of that could ever be possible in the suburbs, and your doomed to waste your life in traffic in pay a poor immigrant to do so on your behalf.
These gig jobs don't promote inequality, they fight inequality.<p>Without the gig apps, rich people are driving themselves to the store to buy their groceries and poor people are not being paid. With the gig apps, rich people are giving cash to poor people in a mutually beneficial manner.<p>These apps help find more convenient and mutually beneficial ways that rich people can exchange money for services. If you have an unequal society, you would want to promote as many of these situations as possible. Each one is an opportunity to spread wealth around and reduce inequality.<p>Getting your own groceries may feel more egalitarian, but it does nothing to help poor people. Hiring them to get your groceries actually puts money in their pocket.
You know, gig economy jobs were dignified work until assholes like this guy started calling them "servants."<p>I'll risk being a bit savage on this one because his entire perspective presumes that the people he is encountering in the gig economy are living under a false consciousness that they are his equal, but that they aren't and they have no hope of it because to him there is no obvious route from their "there" to his "here." It takes a second, but he's not worried about peers, he's concerned about mercifully distant others, presumably to sell some kind of framework that reduces to just listening to him.<p>Yes, there it is. He asks, "is the structure and business model of most VC firms today unfit for solving complex problems sustainably and long-term? Do we need a rethink the VC business model more generally? A first starting point could be a strong embrace of ESG principles — if done correctly and beyond a simple tick-box and reporting exercise."<p>The ESG principles he's advocating need to be "done correctly," which reminds me of another perfect framework I can't name off hand that requires its hosts only do it correctly for it to solve their problems, and I understand historically it has required some initial attrition.<p>Most working people are smarter, more competent, and funnier than sleazy academics reduced to peddling frameworks and governance, and the author and his peers would benefit from being a bit more mindful before airing such patronizing concerns. Servants indeed. What a git.
> The world’s most powerful VC investors are funding an economy where technology allows a ‘ruling class’ to command an ‘underclass’ of servants with the swipe of an app.<p>The author is British, interestingly one of the few society that's actively protecting it's monarchy. You can't be more layered than that: you'll never ever be like these people, and the British people see nothing wrong with it nor these people having servants. They actually prefer it! But the little guy having someone deliver him lunch, that's "problematic".<p>> 85% of Uber drivers are from Black, Asian or other underrepresented backgrounds (similar statistics can be found for Lyft drivers in the US). In 2018, almost 60% of gig workers in the UK were 18 to 34. We talk about people working in dark stores and dark kitchens, out of sight, out of mind — exactly like the servants who waited on Western aristocracy (and colonialists) in the past.<p>Is this by design? Why else allow so much unskilled migrants?
I'm not a fan of VC either but this is unfair.<p>(1) VCs have mostly funded the employment of well educated white collar workers. How else do computer science graduates get paid $120-150k 2 years out of college in the US?<p>(2) There are horrible employers of low skilled workers out there. You ever tried to work in a restaurant kitchen in a city like NYC? You're being paid $25-40k to do absolutely brutal work for brutal hours. Nobody talks about this because there are no evil rich investors involved - just hard working business owners. The divide has always existed. It's just more news worthy now and has a large brand in front of it. Delivery companies are at least offering some level of competition in this horrible labor market.
I fail to see how this new "servant economy" isn't an improvement on the unskilled labor sector.<p>It's never been easier for someone who needs to work two jobs... to work two jobs; one with weekly hours and another you can do whenever is convenient. It has never been easier for a student to make some cash when it's convenient for them and with no weekly obligation.<p>These are improvements on jobs that already existed and new jobs altogether.<p>We should probably be focusing on how to provide more upward mobility and access to education instead of demonizing improvements to an economic sector which will always exist.
So, the concern here is that VC money is helping individuals with a little bit of excess money hire other people to do their bidding.<p>Sounds like one of those "on a computer" things to me. I know the delivery business is booming everywhere but I am mostly concerned from an environmental point of view because that laziness translates into huge amounts of perfectly good containers being treated like they are only good for one thing only: getting some food delivered to you, my liege
isn't "servant economy" just a clickbait-ier rewording of "service economy"?<p>So many sectors of the economy are about providing services... how is any of this different from working in the restaurant industry? Aren't many restaurants almost equally unprofitable as these VC-driven "servant economy" startups?
"The world’s most powerful VC investors are funding an economy where technology allows a ‘ruling class’ to command an ‘underclass’ of servants with the swipe of an app."<p>This is such absurd hyperbole. Show me an economy where a significant number of people didn't have insecure incomes, lack of benefits or do menial work and maybe we can talk about how to recreate that in the modern world.<p>Problem is, such an economy has never existed. Instead of faux yearning for a "return" to such a mythical system, let's talk about how to make our system better.
It's like the author is unaware of why people invest in VC's and why VC's invest in companies. Is it actually possible that he thinks that VC's have "helping the world" as a primary goal? That is too funny. Their goal is singular: to make as much money as possible. The end.
> what kind of an economy do you want to produce with your decisions? How far do you want to push the division of labour between (elite) educated high earners and people providing menial services for this class?<p>Investors don't ponder philosophical questions about the nature and long term societal implications of their decisions (well, most of them). They chase yield/roi/yoy. VC's aren't immoral. It just happens that some of the economic activities that optimize yield happen to be the so called 'gigs' that the author derides as "the servant economy".
Anyone remember Kozmo [0]? It was hilarious to order one candy bar with free same day delivery and know that this ridiculously uneconomic service was being paid for by credulous VCs. But the joke is less funny when it’s 10% of the workforce…<p>[0] <a href="https://en.wikipedia.org/wiki/Kozmo.com" rel="nofollow">https://en.wikipedia.org/wiki/Kozmo.com</a>
The "ruling class" will be shocked if/when the "servant class" flexes its muscle through a Union.<p>Imagine a city, state or nation held hostage by a "Fraternity" that uses Signal to stage a delivery shutdown in order to make a demand. The demand? Agree to a Standard Delivery Tax that will go directly to the Fraternity.<p>VC's may create a monster they cannot control.
> <i>Interestingly, many of these ‘servant economy’ apps are not unit-economics positive even after years of operations (and far from profitable, as in the case of Uber or Deliveroo).</i><p>Is the expectation that these startups will replace human labor with robots/autonomous vehicles in order to achieve profitability?
I wonder if the author’s primary gripe is with<p>1. VCs funding a so-called “servant economy” or…
2. The fact that there are these businesses that perpetuate some form of servanthood (to use the author’s parlance)<p>If the gig marketplaces were bootstrapped, is there still an inherent problem?
I wonder if the author has ever visited any developing economy, where racial stratifications of literal servants (doing chores in the home of the masters) is the norm. For example, a huge portion of the migrate Filipino and Indonesian populations in Hong Kong work as full time household servants.<p>The stratification has nothing to do with venture capital. You could argue that VC money makes this industry less stable, and the lack of stability could have a negative impact on "servants", but that's an empirical prediction that I think is less compelling than the moralizing in the article.
Thought exercise: poof these businesses vanish. What do all these people start doing to support their families? You think they care about you "getting exercise" when they can't feed their children?
What forces of capital are doing anything else? Isn't this what capital wants, isn't accumulating more capital & generating new dependents part of the inherent goal of capitalists?<p>I don't see VC's as particularly notable or different than anyone else, but I also feel like I could stand to have my perception loosened up a lot. The above is more than Socratic; I am curious what pieces of the economy, what engines of capital drive humanity towards independence rather than dependence.
what kind of patronizing ivory-tower marxist bs is that, these apps give people a way to earn a living, especially important for those in disadvantaged socioeconomic strata the authors claim to care about.<p>The author would rather keep people unemployed and on welfare as to not to offend their sensibilities, such typical fake liberalism.
Curious to see how regulations upon “servant economy” (I think this is just old-fashioned expropriation / “primitive accumulation” at work) capitalism will play out in a nominally socialist context. Regulators in China have begun tighter regulation of the capitalists [1], given exposure of the abuses [2].<p>[1] <a href="https://www.reuters.com/business/china-market-regulator-boosts-food-delivery-worker-protections-2021-07-26/" rel="nofollow">https://www.reuters.com/business/china-market-regulator-boos...</a><p>[2] <a href="https://www.rfa.org/english/news/china/riders-03042021131132.html" rel="nofollow">https://www.rfa.org/english/news/china/riders-03042021131132...</a>
Complete the picture: VCs are funded by unreasonably high valued exits, which are fueled by unreasonably easily printed money. This is where the whole system starts looking like a ponzi , fueled by the dollar's (and the US army's) infinite domination. If someone is determined to break this vicious circle, they 'd target the latter two. That's where this giant big tech bubble becomes life-threatening