The End of the Tech Fantasy

Imagine earning a high salary as a software engineer but struggling to afford rent, or your stock options becoming "worth less than your gym membership".

This episode dives into a bold, unsettling prediction: the idea that "every tech worker is about to be poor".

We aim to guide you through the "tricky details" of what's unfolding in the tech industry right now, exploring historical parallels, economic forces, and what it all implies for your future in tech.

Key topics we unpack include:

• Massive Layoffs and Strategic Failures: Discover how over 263,000 tech workers were laid off in 2024 alone. We explore why these aren't just typical efficiency cuts but rather point to "fundamental problems of the business models," citing examples like Meta's "huge strategic mistake" with the metaverse, Amazon's realization about its warehouse strategy, and Google laying off 12,000 people despite nearly $300 billion in revenue.

• Vanishing Wealth and Worthless Stock Options: Learn how the promised wealth from stock options has "vanished" for many. Companies like Meta (down 65%), Netflix (down 75%), Peloton (down 94%), and Zoom (crashed 89%) saw their stock values plummet. For millions, stock options became "digital lottery tickets that expired worthless".

• The Drying Up of Venture Capital: Explore how VC funding plummeted by 50%, from $344 billion in 2021 to $171 billion in 2023. Startups are now focused on cost-cutting rather than hiring, leading to "intense competition... for tech jobs that... mostly don't exist anymore".

• The Shift from Profit to "Financial Fantasy": We trace the evolution of tech from an "original tech dream" of building profitable businesses (like early Apple, Microsoft, and Amazon, which focused on "actual value" and profitability from "day one") to the "financial fantasies" of the late 90s and beyond, where "making money became optional if you could just promise exponential growth".

• The Role of "Cheap Money" and the "Systematic Scam": Understand how "artificially cheap money" from near-zero interest rates (roughly 2010-2022) enabled a "systematic scam". This cycle involved VCs pouring money into startups, driving high salaries and valuations, without ever truly asking, "how does this company actually earn money?". We examine how this led to inflated salaries, not based on "unique value," but on "infinite free money to throw around".

• Echoes of the Dot-Com Bubble: Discover "stark" parallels between today's tech landscape and the dot-com crash of 2000. Learn how companies like Pets.com, Webvan, and Etoys illustrate the "pure hype, zero sustainable economics" of past bubbles, reflecting the "same prioritizing growth funded by easy money without a solid plan for profitability" today.

• The Impact of AI and Political Implications: We discuss how AI is "making things worse for workers," potentially leading to "30% fewer engineers" as tasks are automated, with gains concentrating "at the top" rather than being shared with employees. This situation creates a "massive political problem" as educated people who "did everything right" find their financial worlds collapsing.

The "core thesis" is that "tech wasn't special after all"; it was simply propelled by "artificially cheap money". Now, tech companies "have to play by the same rules as everyone else," often "discovering they don't know how to do that".

The prediction is blunt: tech salaries are "going to come back down to earth," representing a "massive recalibration of expectations and reality".

This episode aims to help you "cut through the headlines" and distinguish between the "tech dream" of building cool things and the "tech fantasy" of "easy riches detached from actual economic value" that "seems to be over".

The most valuable skill you can develop now is adapting to this "new reality".

Now Available on YouTube: https://www.youtube.com/watch?v=uOsUml8oFlE