The Matt Curve vs. Software is *ing the World
A very rich (and very round) person once said “Software is Eating the World.” Since then, every MBA reject thoughtleader has been parroting it as a wonky bull market insight religion for the past 8 years.
In reality, every time someone thought-brags how “Software is *ing the World,” at full volume inside your brain head space, the dies irae should be blaring like a warning klaxon.
For a proper perspective, here’s the venerable VC shibboleth plotted on The Matt Curve:
The Downward Sloping Portion of The Matt Curve Implying Negative Technology Externalities Will Accelerate Forever Is Eating The World — but that’s not quite as catchy.
If we ask google what software is eating we get:
- Software Is Eating the Auto Industry
- Software Is Eating The Job Market
- Software is Eating the Network
- Software is Eating the Edge
- Software is Eating the Video Industry
- Software is Eating the Clinic
- Software is Eating the Income Statement
- Software is Eating the $10 Trillion Construction Industry
Software is Eating the X means:
- Use software as a mechanism of economic control
- Use software to increase your standing in the world by manipulating others
- Since the basics of community software are mastered (payment processing at scale, calendaring at scale, contact sharing at scale), your job now is to lock each of those features behind your own paywalls and marketplaces.
- take a double digit percentage vig of all transactions, which, without you, would be economically optimal, so you must insert yourself as a payment parasite between consenting parties (or between party-and-grifter).
- Automate the means of value extraction at scale.
- marketplaces are ideal because you own nothing and can take a supernormal percentage of community revenue just for making automated webpages and hosting 3rd party payment processing forms
- pretend to have complaint procedures for your marketplaces, but always favor yourself and future revenue extraction over any actual satisfying resolutions
- Generate a monopolistic marketplace through basic sticky tooling (e.g. become people’s one true source of their property calendar availability so they can’t list on multiple sites)
- Refuse to export data, monopolistically (e.g. of course never provide an API for people’s property calendars)
- You’ve summited the peak of The Matt Curve, so adding more technology won’t make the world better. Now your only purpose in life is to create more software to make the world worse off, but you will personally end up better off. Thanks, software eating things!
- Software is Eating the World, on the downward part of The Matt Curve
So, ergo, qed, e.g.:
- A Nationwide Scam on Airbnb
- So what if a $50 billion (though, never publicly floated, which kinda matters) company fronts thousands of global scams while completely disclaiming liability or responsibility because they have nice offices and cult-inspired leadership?
- Just make sure your company itself doesn’t pretend any ownership or control over property, give people 25% refunds off their ruined trips, then keep piling up those illegal service fees while destroying rental markets around the world which is okay because VCs can post-hoc generate any convenient social narrative for enabling multinational corporate abominations.
- The count of managed service providers getting hit with ransomware mounts
- software is eating your tax dollars to pay off cryptolocker remediation
- Is WeWork a tech company? Is Peloton a tech company?
- wework is the brexit of blitzscaling
The definition of a “software is eating the world” tech company in 2019 is:
- A corporation capable of extracting recurring revenue, ideally through statutory subscriptions (or 20%+ add-on marketplace fees), from consumer credit card spending.
- Technology optional. Tech portion of “tech company” may be as small as a recurring billing portal. According to this, my extra space storage unit with automatic 5% rate increases every 4 months is a tech company.
This is part 1b of my 2019 moloch series. We had to cover egotistical self-motivated tech first because technology turning evil is the basis for modern society inversions (or, basically a return to default pre-liberal-mid-1900s mindsets of monopoly, capital hoarding, as global destruction for personal profit).
The world is crumbling and it’s your fault, but at least you got objectively rich compared to your peers along the way.