Comment by solenoid0937
3 hours ago
I'd love to read the mind of an investor that actually falls for this shit. Who actually thinks that Allbirds will see much higher returns because they "have an AI graphics division?"
I like AI, but seriously, who actually invests on this basis? Where is the critical thinking? I don't feel sympathy for any investor that gets rug pulled on this stuff.
Allbirds sold their shoe business and is basically a SPAC that spun up an AI company under the existing publicly traded company. For all intents and purposes it’s just a new AI company.
You think an investor gives a shit past "if they say this, the numbers will go up"? And the numbers mostly go up because everyone has the same mentality.
No one cares about the product any more. And that will be the end of all of this.
It’s the latest version of the meme stock craze. Nobody bought Gamespot stock because they thought it was a good long term investment. They bought it because they thought they could quickly double or triple their money and leave someone holding the bag
Or just investment quotas requiring AI in the portfolio. I suspect it's mostly this. Or getting included in more indices etc.
The more trendy boxes you tick, the broader the universe of people whose box you tick and who can thus invest.
Investors by nature lap up hype, and it seems to work for them
AI graphics division: Putting in 100s of engineering hours to build and internal AI tool to produce AI-slopified marketing in order to save ~2h a month of human work.
They're almost certainly hoping for a Greater Fool.
The same investor who will buy SpaceX at 250 PE. They are all over the place, hence all the AI washing.
https://youtu.be/oVItKzP6IBY
A lot of it is prisoner's dilemma and its variants. As an investor, even if you think a particular AI shift is bullshit, you have to take into account the possibility that other investors won't - and at that point you might miss out on the gains.
This is one of the reasons stock market is so disconnected from reality.
its greater fool theory https://moneyterms.co.uk/greater-fool/
But wouldn’t it be a failure if it’s bullshit and therefore no gains?
Not if you sell before the other fools.
A16Z's post on the Slack IPO (https://a16z.com/announcement/slack/) is a good pointer to the kind of thinking here. A pivot from an unprofitable game to laying off 80% of the company to a weird communication app could be fairly described as "bullshit", but when your business model is finding the rare exceptions where the stars align and a company ends up being worth billions, it's not a kind of bullshit you can afford to be entirely unreceptive to.
> Who actually thinks that Allbirds will see much higher returns because they "have an AI graphics division?"
Perhaps the investment is more on the “greater fool” theory. “I think this is complete nonsense, but there’s probably someone not as savvy who will buy into this garbage idea upon which I can profit.”
>I like AI, but seriously, who actually invests on this basis? Where is the critical thinking? I don't feel sympathy for any investor that gets rug pulled on this stuff.
They don't and the people who are falling for this rhetoric are naive. Most investors _should_ invest more in AI companies. And most companies _should_ invest in AI. It is the rational move and it is exactly what we are seeing here. I don't know what the hysteria is about.