It's Not a Bubble, People; It's a Pyramid Scheme  - <AUTHOR> http://www.pehub.com/96111/its-not-a-bubble-people-its-a-pyramid-scheme/ <comment><USER2> Mark Cuban's statement is only true if the VC financings are simply a buyout of previous investors. Many of Facebook's recent financings were capital injections + buyouts of founder and early VC shares. I don't believe this is the norm. Simply, VCs at round t-1 typically participate in round s > t and if they don't, future investors will not buy them out. If they did, it would simply mean that none of the money going to firms like Twitter and Zynga is used for investment.

<comment><USER3> Lot of people including Mark Cuban predicted that Youtube is a sinking boat and that Google made a horrible mistake in buying it. Look at the present situation - youtube is raking in 1B per year.

Any market leader facebook/zynga/twitter with their user base can become a cash cow with enough focus. No one else in the world get internet companies like valley/US does. This is the single most reason every other country's .com company gets traded in nasdaq.

</comment></comment><comment><USER4> Agreed.

It seems human beings are really bad at mathematics, we could spot a quality, but not the quantity.

In Spain people thought houses near the beach were always in demand by Europeans because of the good weather(quality), but failed to understand there is a limit to the money they will pay for it(quantity).

With facebook people could see the value it gives to the world witch is real (quality) but overstates the amount facebook is going to give back.

facebook is a pyramid scheme designed to make uber-rich the current shares holders(Zuck and employees hold near half the company stock), witch is great for them, bad for those that payed the overprice.

<comment><USER5> There is some serious witch hunting to be done in this thread.

<comment><USER6> Toss them in a river.

If they sink they are innocent.

If they float they are in a bubble.

<comment><USER7> Or you could just weigh them against a duck !

</comment></comment></comment></comment><comment><USER8> One thing that the last boom showed is that the first well executed play in a segment captures the segment and makes competition nearly impossible. Examples Google, Amazon, and eBay. The investors are betting that Facebook, Groupon, Zynga, and Twitter have captured their segments and further competition is impossible. The gamble is whether those segments are now closed. They weren't in the case of Alta Vista and Myspace.

<comment><USER9> I agree that the investors are making that gamble. A better way to look at Google though is as a company that made major breakthroughs in two segments (search, advertising) and then executed brilliantly for years while benefitting greatly from its rivals' (Yahoo and Micro) sustained incompetence. Which of the new group has breakthroughs in two segements? Which is on track for years of sustained brilliant execution? Which will be lucky enough to have incompetent rivals?

</comment></comment><comment><USER10> But aren't bubbles and pyramid schemes the same thing? The article should really define bubbles if it wants to argue they're different from pyramid schemes.

<comment><USER11> Bubbles are usually fueled by public manias (e.g. tulips or real estate). Pyramid schemes are planned frauds.

<comment><USER10> Ok, but both rest on the "greater fool" theory...

<comment><USER11> Yes

</comment></comment></comment></comment><comment><USER12> I think he's making "a distinction without a difference".

Pyramid schemes, Bubbles and Ponzi schemes are all instances of what Hyman Minsky called Ponzi Finance. They all "recycle" new "investment" money coming in as their operating income.

[http://en.wikipedia.org/wiki/Hyman_Minsky#Minsky.27s_theorie...](http://en.wikipedia.org/wiki/Hyman_Minsky#Minsky.27s_theories_and_the_subprime_mortgage_crisis)

A "pyramid scheme" makes it more explicit that the earlier entries get more. If you make that less explicit, what else do you have but a "bubble"?

The reason not to worry about these variations is that there aren't really three distinct variations of this theme but three million, with one born every minute - _along with the suckers_.

</comment><comment> DanI-S I've been wondering recently - a phenomenal amount of money and investor excitement is circling around these few big companies. If it turns out that they _are_ overvalued and the 'bubble' does burst, does this mean there could suddenly be a surplus of capital and investor attention that will spill over into smaller, less well known businesses?

If everyone who is waiting to get their piece of Facebook or Groupon suddenly thinks better of it, could they decide to redirect their money toward smaller interests, increasing the availability of capital for 'the rest of us'?

<comment><USER13> >could they decide to redirect their money toward smaller interests, increasing the availability of capital for 'the rest of us'?

Probably not. That money is pretty much stuck there, as VC is an illiquid investment. Money invested in Groupon isn't going to get paid back until they have a "liquidity event", like being bought or IPOing, or until you can sell it to another investor. However, it's possible a larger fraction of new VC investments could be targeted at "the rest of us".

<comment><USER14> Well it's definitely not a one-for-one distribution, but those Groupon dollars do make it around. Our site has Groupon ads popping up almost constantly, and actually tend to yield a higher clickthrough.

Massive injections of capital into Internet businesses do help overall economy of web startups. The danger, like the Yahoo comment earlier, are the spotty business models and expansion that are built on that frothiness. Cause when it goes, it's those startups that crumble first.

The ones that figure out a business model that isn't tied to a flush VC climate should be ok. eBay as I recall, did just fine after the first bubble.

</comment></comment></comment><comment><USER15> It will have gone full circle when Facebook, Groupon and Twitter will have an IPO. VCs and other investors will get their money back and individual investors will absorb the losses of the collapsing pyramid.

</comment><comment><USER16> All bubbles are Pyramid schemes. That's the definition. See The Financial Instability Hypothesis by Hyman Minsky:

<http://www.levyinstitute.org/pubs/wp74.pdf>

<http://en.wikipedia.org/wiki/Hyman_Minsky>

When the economy reaches the third phase of "Ponzi Finance," entities must recruit additional investments to meet their interest payment obligations. This is the classic pyramid scheme and also frequently called a bubble when it's referring to a financial market.

Ponzi scheme, Pyramid scheme and bubble are all synonyms.

<comment><USER17> Not really. A bubble can be a self-organising Ponzi scheme - earnings from Yahoo came from advertising which was paid for by capital going into the tech bubble; and the pre-GFC US economy was arguably one giant bubble (with earnings being paid by people who were willing to do overtime to keep their million dollar houses out to the hock), but it's not quite the same thing.

They do have the same (or similar) dynamics though.

</comment></comment><comment><USER18> I suppose Cuban's comments ring true if you think that Twitter and Facebook are adding no value.

I am unsure how any rational technology-minded person could state that they add no value; the idea that a technology which is one of the first Governments try to ban when they are under fire -- that the technology must not be worth anything -- is pretty staggering.

Facebook has a pretty clear path to socially connecting THE ENTIRE WORLD via the Internet, and has proven it can do it in a cashflow-positive way.

I fundamentally don't understand the 'bubble' complaints right now: these companies are the anti-boo.com's of our time: Wildly successful, working, scaling businesses which millions of people rely on every minute to do their work and socializing.

Focusing on valuation for smaller companies also seems silly to me: the YC class that just got $150k per company will be able to punch out some incredibly great and useful technology for that money. In 1999, that money would have purchased 2-5 servers, and no co-location for them. Really. You can worry about a bubble, but if these companies even produce 300k in value, then the investors didn't invest in a bubble, they got their principal back plus a little.

I do think it likely we'll swing back to a slightly less founder-friendly funding regime at some point in the future, but it may also be that we're just at a new plateau given what's currently possible in software. Another shift might change funding dynamics again in our industry; but right now, a whole lot of useful tool can be created for a couple hundred thousand dollars.

<comment><USER19> "Facebook has a pretty clear path to socially connecting THE ENTIRE WORLD via the Internet, and has proven it can do it in a cashflow-positive way."

Yes, I see that they can connect. And maybe tomorrows revolutions will use facebook -- but the fact remains that I value my privacy and those of my social relationships. That's just it.

<comment><USER20> You might, but all the people using Facebook really don't. Especially the whole 13-33 contingent raised with the internet - the convenience of being able to keep in touch with your friends circle is worth more to them than their privacy.

If you think privacy concerns are going to hinder Facebook's profitability you're completely wrong.

</comment></comment></comment><comment><USER11> This is unoriginal. And as someone else stated on FT, the last layer of the pyramid scheme is probably aimed at dumb money. Unintelligent mutual funds (mis) guided by S&P and Moody's ratings for inflated assets. Just like it happened in 2006-2007. I believe more "AAAA++++ would buy again" ratings from random people on auction sites than credit rating agencies. It's a scam with many players. The agencies get their cut, too. And there's no downside for them (mostly).

Edit: it happened with government bonds, too; in fact it seems they move on to the next scam every year.

<comment><USER21> S&P / Moodys are rating companies for debt, not equity. The investment proposition for someone lending a company money as a secured creditor is very different to someone investing equity, and I'm not sure that it directly results in investors getting any profits.

<comment><USER11> Yes. I'm wrong. But the ratings of the debt of corporations are highly correlated with their valuations.

Edit:

To be clear, I was talking about dumb money. Usually indexed funds and such. _Enron was part of S &P 500 for years_.

</comment></comment></comment><comment><USER22> I don't get it. It sometimes is the case that early-stage investors sell off parts of their shares in later rounds, but this is not the norm. In which case yes, there is pressure on later investors to give high late-stage valuations for a company which had high early-stage valuations, but it's not the case that angels and early-stage VC's can ignore the company's final outcome and profit merely by bringing in later stage investors, which is the distinguishing feature of a pyramid scheme.

</comment><comment><USER23> Any money paid for private or public companies is entirely voluntary on the part of the seller and the buyer. If you don't like what your investment manager invests in, it's easy to move your money elsewhere, unless you weren't smart enough to insure you had a way out of your investment promise. If you want to be one of the early investors who gains the most reward, then be one of the early investors who takes the most risk.

</comment><comment><USER24> How is this different than the economy as a whole? Look at seniorage and Milton Friedman's take on what caused the Great Depression. As money circulates in a fractional reserve banking system it multiplies. The last guy holding the dollar is the guy who loses most. In times of exuberance that multiple is greater than 1 and in times of pessimism that number is less than 1 which is why consumer confidence is essential to the functioning of the modern economy.

Start thinking of money more as a piece of information reflecting scarcity of supply/demand, and realize that the faster information moves the faster money will cycle increasing it's rate of growth. It's called an information economy for a reason, because the commodity from which we derive most of our value is information. This is largely why it doesn't matter that China is taking "our" manufacturing base. You can point to the importance of things like iPhones being manufactured in China, but for the economy as a whole the AppStore is far more important than the manufacture of the phone. As information bandwidth increases globally so does money supply.

</comment><comment><USER25> "Either way, when the chain ultimately ends, few, including Cuban, will feel terribly sorry for those left holding empty envelopes."

Except that lately it is usually the general public that is brought in, to help the investors no longer be the last in the chain. Maybe this will begin to happen with VC financing?

Along the lines of the quote I have read from several sources "when my barber and the shoe shine boy has a stock tip, it's time to get out."

<comment><USER15> I agree. In the 90's bubble the public got let in earlier. Now VCs and investment banks squeeze all the value out before the public finally can invest.

</comment></comment><comment><USER26> In economy, if you want to avoid bubbles/pyramid burst, you have to check who is investing (as stated by Warren Buffet)?:

The three "I" actors: \- "I"nnovators: Time to invest \- "I"mitators: Time to be careful \- "I"diots: Time to leave

The key to success is to spot when the ecosystem's actors are switching from the 2nd to the 3rd category.

</comment><comment><USER27> umm, hate to point this out but assuming Cuban's point is true (which is obviously highly debatable), the people with the most to gain are the founders (from being at the tip of the pyramid) aka most people on this thread hence there is probably a strong bias towards not recognizing the issue

</comment><comment><USER26> Ponzi Scheme are everywhere: <http://www.youtube.com/watch?v=ITMEZImvNio> (Slow/questionable start... because he is trapping the guy)

</comment><comment><USER28> But whose money is in those funds managed by the fund manager?

<comment><USER29> Probably your pension.

<comment><USER30> Not unless your pension manager has some really huge cajones.

<comment><USER31> That's not true. Pension managers are increasingly turning to fund of funds hedge funds, etc. It would only take fundA investing in a private equity or a social media financial product and then a pension manager investing in fundA for whatever reason.

<comment><USER30> What would the draw of a highly volatile pension investment be?

I would think that pension managers would be encouraged to keep something that would generally have a stable (but not necessarily particularly high) yield.

I don't doubt that this sort of thing happens for various reasons, but those managers would, by definition, be taking somewhat unusual risks.

<comment><USER31> The risks are often masked. This is an extreme example, but imagine a fund of ultra safe bonds and an investment in Zyanga, Facebook, Twitter, etc. Depending on the make up of the fund that particular funds risk profile may look similar to what might be called a moderate risk growth fund.

Now, a fund buys that fund and puts it with a bunch of other funds and now the risk profile is under another level of obscurity.

Now a manager buys that fund of fund and puts it with other financial products and that's your pension. Basically, the further you get away from the actual investment the more diluted the risk profile becomes. What could potentially happen is that a particular manager is buying products that somehow are invest in a particular sector (perhaps too heavily, and it is masked via the layering) and the sector pops and what he thought was diversity is actually concentrated risk.

</comment></comment></comment></comment></comment></comment><comment><USER9> Agreed. <http://bit.ly/tcangelgate> is a good example of pyramid-scheme-like behavior.

</comment><comment><USER32> The guy has a very good point.</comment>


What I learned from watching my iPad's slow death - <AUTHOR> https://www.nytimes.com/2018/02/06/magazine/what-i-learned-from-watching-my-ipads-slow-death.html <comment><USER3> For what it's worth, PCs are subject to the exact same slow decline, even if the author's romantic notions of repurposing an old machine ring true. While they may be suitable for old games on an unnetworked, phone-activated WinXP, or as a power-hungry Linux machine that will perform admirably as long as web browsers aren't involved, both fates are the same: frozen in time, locked out of the dizzying speed of evolution of online services and the portals through which they are viewed. Stallman's right yet again: the offline programs will run just the same, but the online programs are subject to change at a moment's notice, from Apple shedding support of 32-bit hardware, to application makers shedding support for old OS versions, to online backends forcing mandatory updates.

It feels worse with the iPad because its marketing made an impression of a sleek, "just-works" kind of device. Of course, its utility is tied exclusively to applications from a captive marketplace, and often, to remote services frontended by those apps or the browser, making its elegance a leaky abstraction. Today's Chromebooks, another "just-works" device, will be in the same situation in five years.

But with Chromebooks, or Android phones (if you're lucky), or x86 or x64 PCs, you can replace the stock OS and repurpose the device on the hardware's own remaining merits. An iPad is just stuck.

<comment><USER4> "For what it's worth, PCs are subject to the exact same slow decline"

Maybe eventually, but not within 5 years. I'm currently typing on a 2011 Dell with an i3 proc and 6GB of RAM, running Ubuntu. I have 19 other tabs open in Chrome. It dual boots Win7.

I can use this 7ish year old PC for social media, email, HD videos and streaming music with few annoyances due to performance, in either OS. Not so with the 5 year iPad he describes. While I can do several of those things at once, it seems he has trouble with even just one.

<comment><USER5> Not anymore, but it's only recently that that's been spun as a good thing.

Tell someone around 2000 that a 7ish year old PC would be adequate and you'd get laughed at. 1993 to 2000, for instance: You'd be comparing a Pentium at 60Mhz (some quick googling says 60Mhz was first hit this year) on the high end to a 1Ghz Athlon. Probably >20x real performance improvement (the clock alone is 16.7x).

Mobile devices will catch up and stagnate too, sadly.

<comment><USER4> You say "recently" and then compare computers from 18 and 25 years ago. That's just about a generation in human years. The comment I replied to said, "For what it's worth, PCs are subject to the exact same slow decline". ARE subject, not WILL BE or USED TO BE.

"Mobile devices will catch up and stagnate too, sadly."

Uh, if they catch up to my point, then they will still be useful at 5 - <USER2> years, thus the opposite of stagnant.

<comment><USER6> I almost typed up the comment that you responded to, probably for the reason that 2000 is still "recent" in my mind :/

</comment></comment></comment></comment></comment><comment><USER7> "a late-2012 iPad Mini, model number A1432, black, with 16 gigabytes of storage. It retailed, at release, for $329."

So the cost of owning this iPad has been less than 20 cents/day over its 5 year usable life. That doesn't even factor in the slight energy savings vs using a full laptop if you want to be nitpickey. Nor does it factor in the current resale value. I just sold an original iPad 1 for $80 on Craigslist. I'm sure this would be worth at least as much, if not more.

"I still use my old iPad for passive consumption: reading, watching videos, checking feeds ...formerly easy tasks have become strained. Social apps have become slow, videos take longer to load and Safari can't seem to handle the most important and fundamental services of the modern web."

This is all also true of my maxed out 2012 MacBook Air. Final Cut Pro X runs more smoothly editing HD video than browsing Facebook. And, while I agree the uses for an old iPad are limited (photo browser, music player / media controller, eBook reader, kitchen recipe browser), they are more elegant than keeping an old computer around.

The mixed blessing and curse of something like the iPad is that it still looks beautiful and functional long after it isn't. I'm sure it would be easier to part with the device if it was a 5-year-old $300 Celeron netbook.

<comment><USER8> No. It's not okay to make devices obsolete by software.

Arguing for the low cost of ownership per day is a strawman.

</comment></comment><comment><USER9> My Panasonic 'Smart TV' is from 2014 and its app marketplace doesn't have Netflix. It's just not there. My laptop is from 2011, and since it runs the latest Chrome browser, it can play Netflix just fine. Made me think: the fact that laptops & desktops are consumer devices sold with hardware and operating systems that do general-purpose computing is underrated.

<comment><USER10> Beyond that, that nothing on the hardware side stops you from running any software you want to.

Expect the PC to morph into something more akin to a tablet or "smart" TV if the MAFIAA get what they want (and Intel and crew seems all too willing to give in).

And that point your GPC will be relegated to a developer workstation that may well require a verified employer and regular visits from an auditor to own.

<comment><USER11> Yup. Cory Doctorow warned us about it for years (Google keywords: "war on general-purpose computing").

And the sad thing, I'm not sure we can escape that. MAFIAA wants it. Large businesses want it. And to top it off, _computer security specialists want it too_. Ideas like sandboxing, or trusted computing, or hardware crypto modules - all provide security while simultaneously _taking control away from the user_.

I seriously fear that soon, having a general-purpose computer connected to the Internet will be considered a public safety issue ("because botnets!"), and eventually you'll need a professional license to be allowed to work with a Turing-complete language ("because langsec!"). I very much don't like it.

<comment><USER10> Yeah he followed it up with "civil war on GPC", where he basically started to favor "DRM". This with the caveat that it was the owner of the computer that would have control of the keys, and frankly i do not see that happening.

</comment></comment></comment></comment><comment><AUTHOR> My mother-in-law is in the same boat. She is not a demanding user. She basically uses her iPad for 3 things: buying things on Amazon, looking at pictures of her grandson on Facebook, and checking her stocks with the Fidelity app. Well, the Fidelity app recently informed her that she could no longer login unless she installed a required upgrade. It turns out the upgrade is not compatible with the version of iOS that runs on her hardware. So just like that her iPad became obsolete.

<comment><USER12> Have her try using the web applications instead of native iOS applications.

<comment><USER13> that's probably worse. non-updated ios => non-updated safari => 0days galore

<comment><USER14> You should be OK going to Fidelity.com

Not the deep web

Of course not easy to communicate to parents or grandparents who are less tech savvy

<comment><AUTHOR> Given her level of tech-savviness, that's not as easy as it sounds. Also, it seems more secure to have her just use the app - less possibility of phishing attempts and the like. She already bought a new iPad anyway.

<comment><USER15> Can't you make a shortcut for Fidelity on the "desktop"?

</comment></comment></comment></comment></comment></comment><comment><USER16> One of my biggest fear nowadays is I will someday mistakenly press "OK" to the annoying "Update to iOS 11" popup without thinking, and my iPad will be practically bricked.

My iPad is a relatively recent iPad mini which I bought a couple of years ago, but I know from my iPhone 6, I know upgrading to iOS 11 will slow down everything, for example each app taking about 10 seconds to launch--including Apple's own apps like Mail.app and Messages app.

Is there a way to completely block that upgrade to iOS 11 popup so I don't make the mistake?

<comment><USER17> [http://www.idownloadblog.com/2017/12/11/block-ios- updates/](http://www.idownloadblog.com/2017/12/11/block-ios-updates/)

Also, I marvel at how watered down the term "bricked" has become. From 'my thing shows absolutely no signs of life' to 'my thing is a little bit laggy'.

<comment><USER16> Thanks, but I wouldn't say "a little big laggy". I am not exaggerating when I say every app takes ten seconds to load.

I actually measured them and that's the average time it took for all apps to load after I updated to iOS 11 (Before iOS11 it loaded immediately).

If you can sympathize with me because you have more recent phones, please try to close your eyes and count to ten and imagine, hopefully that may give you an idea of how frustrating it is for peasants like us.

<comment><USER18> Then there's something broken with your iphone 6, because until the 8 came out I was using a 5S and it was observably slower but not '10 seconds for every app' slow as you apparently describe without exaggeration. I had upgraded it to iOS 11 before moving to the 8, too.

<comment><USER19> iPhone 5S isn't subject to the battery-related CPU throttling.

My iPhone 6 took 10 seconds to load apps, but after a battery replacement it takes me about 4 seconds. Also, I noticed that apps stay in memory longer which means that I don't have to do a fresh app load that takes 4 seconds.

<comment><USER16> isnt 4 seconds still slow though?

when i say it takes 10 seconds i mean the screen is blank white for 10 seconds.

I think it's not as ridiculous as 10 secs but 4 seconds of blank white screen is not so much better...

</comment></comment></comment></comment></comment></comment><comment><USER20> I have a 3rd gen iPad that I feel like there should be a 3rd-party logic board / OS update for.

There are approximately a bajillion 3rd gen iPads out there. Imagine walking into the local screen repair place, having them stick in a new Android board that reuses the digitizer, screen, and case. Maybe they pop a new battery in while it's open. Bam! Renewed iPad.

Given how cheep various SBCs have gotten, I have to imagine there is an economic business model for _someone_ in retrofitting all these old, homogeneous, plentiful devices.

<comment> gm-conspiracy Please!

Somebody kickstarter this!

</comment></comment><comment><USER21> The main issue with this is that Apple doesn't allow downgrading of iOS. Thus, one might be able to maintain a device on an older version of iOS that is most suited to it, but if anything happens that requires a restore, then that device is effectively dead in the water. It seems to me that at the very least, Apple should backport relevant security fixes at least one major version, if not two (for example, a bug found in iOS 11 should also be patched in iOS 10, should it be present), and they should sign the last revision of one or two major versions back, so that these things aren't thrown out en masse.

<comment><USER22> This part is so ridiculous!

The new version of IOS broke some of my apps so I went to submit feedback on those apps that Apple broke their app with their new OS and it turns out that providing feedback in the app store is also now broken!

I literally cannot do anything now because I cannot downgrade my OS nor can I tell the developers that Apple broke their app with the new OS version.

</comment></comment><comment><USER23> I have 2 original ipads that are in excellent shape. I spent a weekend looking for some way to repurpose them into photo albums that sit there are cycle through photos.

I couldn't find a working solution.

All the apps won't work properly and the browser doesn't work with things like Flikr or Google Photos.

It is a shame since the display is still awesome.

Any ideas on what to do with them?

<comment><USER24> Hmmm... maybe make your own webpage that cycles through the photos? You probably don't want family photos on a public URL though...

<comment><USER25> They don't need to be public. A $5 RasPi Zero would be plenty powerful enough to serve photos on a local network.

</comment></comment></comment><comment><USER26> I got my iPad in May 2010 and it still works fine, including (amazingly), the battery. Except of course, the software has become useless. YouTube doesn't work unless I do special URL mangling in the browser, which crashes every 2 seconds anyways. The latest OS release is so old it's from the days when Apple had a YouTube app, which Google later shut off the API for.

I really feel it deserves a second life running some kind of alternate OS and can think of several uses for it, but last I checked there wasn't much of that happening.

</comment><comment><USER27> As a counterpoint. My first generation iPad released in 2010 can still be used to watch Netflix, Hulu, Plex, and a few other services.

Spotify works as does iBooks, Google Drive (reading PDFs), Mail, Calendar, etc.

I reset it last year and redownloaded old versions of all the third party apps mentioned above.

Now Safari on the other hand, crashes constantly.

I do have the newest non-Pro iPad and of course it performs better.

</comment><comment><USER28> By way of contrast, I'm still using the PS3 I got 7 years ago (when it had already been out a few years) every day and it runs speedily and mostly smoothly - my sole annoyance with it is that it doesn't adjust for daylight savings time automatically. That said I never use it for web browsing as the browser has always been rather crap. Netflix and similar apps do need a few seconds to load, but then they always have as it's using an actual hard drive rather than a SSD.

</comment><comment><USER29> I actually felt this way about my Asus Android Nexus 7 2013 - I didn't use it daily or even monthly, just enough to remember it. It largely collected dust and now it longer gets updates.

I rooted it a few days ago and also installed lineage 14.1 and I'll have to say, it's like a brand new device again. I was very surprised. I'm plan to mount it next to my thermostat and use it as a "solar" dashboard for showing consumption and production.

<comment><USER30> You're lucky. I used mine moderately, then the SSD just up and went kaputski. Couldn't reflash it or anything. Dead.

</comment></comment><comment><USER31> I have a 1st generation iPod Touch, still working as music player in an old JBL dock. It's just for that, and that is enough for me. An old iPad like the one described here is nothing more or less than an old laptop that's getting too slow.

So what has changed? Nothing much except excellent quality hardware. That hardware can still be used by the way, to display videos, play (old) games. Great toys for little kids?

<comment><USER32> > old JBL dock

FYI the old iPhone/iPod docks can easily be upgraded to bluetooth for about $10 by buying a bluetooth adapter (powered by the dock, so apparently a few docks don't work).

</comment></comment><comment><USER33> I'm not exactly sure what the chief complaint here is.

Is it that iPads are not upgradeable? Well, Apple has an entire system for recycling and credit. Also, an argument could be made that an upgradeable iPad would also cease to be as useful as an iPad, as it would necessitate some level of form-factor change.

Is it that software keeps moving forward? Well, that is not new, and is not unique to an iPad. A five year old computer running a recent browser will also struggle with new websites.

Is it that the author can't give the iPad to someone else who could use it and wouldn't be as frustrated? I fail to see how that is the case.

I'm sure using a five year old computer can get frustrating. But I think the fact that an iPad is still quite functional after five years of use is rather remarkable. No one writes op-eds in the NYT lamenting the slowness of their five year old netbook, because those devices are even more disposable than an iPad.

Edit - that is not to say that there is not an issue with aging iOS hardware. I just don't think the article makes a clear argument, or even statement, of what that issue is.

<comment><USER34> > A five year old computer running a recent browser will also struggle with > new websites.

My _gaming rig_ is 5+ years old and still runs new games fine. I don't even know where you came up with this. My wife owns a 2012 Macbook Pro and it still runs everything fine, even the newest OS and MS Office applications.

<comment><USER33> sorry, I should have said "low end laptop," "netbook," or "chromebook." Those are all in the same class as an iPad, with the same portability requirements, etc.

<comment><USER35> I've been using my $300 Acer c720p chromebook for almost 5 years. Keys are falling off, it has quite a few cracks and smudges, and the battery is less then half of what it used to be, but it still boots up in about 8 seconds, and there's no new noticeable lag. Right now sounds like my Chromebook was a better decision than a iPad.

</comment></comment></comment></comment><comment><USER36> I have a first-gen iPad sitting around. Is there something like postmarketOS I could install?

Hell, I would even settle for using it as a headless box ...

<comment> compiler-guy I feel like old ipads would be useful as the head to another box, rather than a headless box. They have decent screens, and would work well as, say, an extra screen to a movie player for kids on trips.

It's unfortunate that there isn't an easy way to do it.

<comment><USER37> I use 1st gen iPad as client for Plex it runs ok there. It can also play (correctly prepared) movies and YouTube, so it is really ok for kids use.

</comment></comment></comment><comment><USER38> The (original) iPad I received as an Xmas gift in 2010 is still alive and kicking. In fact it is the most robust piece of ("mobile") hardware I've owned since 2010; outlasting various iPhones, Nexus devices, laptops and other electronic devices which have been purchased or received as gifts.

Then again it's only used to stream movies, read news and light browser based activities. Amazingly and to the delight of the kids most games are still playable.

The only other portable electronic devices I own with similar resilience are the original Raspberry Pi and potentially a 2011 Mac Book Pro. Though having to replace the logic boardonce and battery twice probably disqualify the MBP.

</comment><comment><USER39> My parents have an iPad 2. It's still in good condition, battery still very good. But they can't use it anymore for Skype: Skype delivered always slower apps as the time went on, and now the last version of the app is too slow to be used at all: when somebody calls the app gets so big lag that it just fails.

Also, some app writers make the app compatible with every iOS. Not Microsoft. Even newer versions of Skype aren't for iOS 9. But the last for iOS 9 was already too slow.

From this perspective, the biggest problem are the companies which decide not to test on the older hardware and which don't want to support older iOS versions.

</comment><comment><USER40> What we've seen in the tablet space over the last decade is a yearly boost in hardware specs that has not been seen for some time in the PC marketplace.

Consider that the original iPad only had 256 megabytes of RAM and a single core ARM Cortex A8 CPU while the current entry level iPad has 2 Gigabytes of RAM and a dual core Apple Twister CPU.

If you go back to the days when PCs still saw that sort of repeated yearly performance advances and try to run Windows Vista on a machine built to run Windows 95, you're going to run into the exact same sorts of problems.

</comment><comment><USER41> My first-gen iPad Pro, the big one from 2015 or '16, is getting really slow, particularly with Safari, and it gets all the updates. Having some trouble understanding what's going on here.

<comment><USER42> Your first-gen iPad Pro is still new compared to what this dude is packing. There's an iPad from 2012 sitting on my desk that stopped receiving updates and, for getting any kind of work done, the thing is useless.

<comment><USER43> You're using a 5 year old tablet for work? That thing is financially depreciated 2 years ago. For security reasons alone you shouldn't be using it to do work.

<comment><USER42> It is literally sitting on my desk, doing nothing

</comment></comment></comment></comment><comment><USER44> I bought my first iPad primarily as a music creation device. I purchased almost every keyboard, recording and guitar amp sim app that came our for the first generation iPad, and had a ton of fun with them [0][1].

But then, the inevitable happened, the keyboard synth algorithms, multi track recorders, convolution reverbs etc., all improved and became more complicated, to the extent that the processor on the old iPad simply couldn't keep up any more. So I pretty much HAD to upgrade.

The old iPad is _still_ in service though - my wife is a portrait artist and uses it to display reference pics next to her easel that she can zoom in and scroll around in. As the author of the OP has said - no problem with its aesthetics or reliability, we just reverted to using the apps that still work within the confines of its processor and memory limits.

[0] - [https://soundcloud.com/cyberferret/in-a-bad- moog](https://soundcloud.com/cyberferret/in-a-bad-moog)

[1] = [https://soundcloud.com/cyberferret/industrial-ants- wav](https://soundcloud.com/cyberferret/industrial-ants-wav)

</comment><comment><USER45> The iPad I use for watching cartoons in bed is a minimum spec 1st generation iPad. It runs iOS 5.1 and hasn't updated in about 5 years. Most of the apps are no longer supported. I can still use NetFlix, Amazon Prime Video and Crackle. I am not sure about Hulu, CBS, or HBO Go as I am not currently subscribed to these. I can watch YouTube and some other video sites in Safari, which frequently crashes because it runs out memory.

Originally I used to charge it every 10-14 days. Now I must charge it every 3-4 days.

As a video watching device it is still fine. I would be happier if the utility degraded a little more gracefully. I can't think of a good reason why AdultSwim or CartoonNetwork shouldn't be supporting legacy iOS versions for their video players. Their target audiences are more likely to be using older hand-me-down devices. On the other hand, this device is also now the only device I can use to still play older 32-bit AdultSwim games like "Monsters Ate My Condo" and "Mole Attack" that no longer run in iOS 11.

</comment><comment><USER46> iPad mini 1 are selling on ebay for 80£, I wonder if there isn't anyone exploring the business opportunity here for corporate software, were instead of buying 300£ iPads to show the schedule of a meeting room, you can just code against an old version of IOS and supply your software with hardware at a high discount. edit: had 30£ before, but was a bid not a buy now

<comment><USER47> Anyone doing this would be opening themselves up to a world of liability, and probably a lot of customers who would say no. I know my work is dumping older ipads even though all our integrated software for meetings etc works fine just because it _could_ be exploited and isn't receiving updates. Even the possibility of that isn't worth it to a lot of places. It doesn't matter if it's connected to a "closed" network, it still has radio(s) on.

And since so many places are so slow to upgrade, this is a known attack surface. Once you exploit that old-ass iOS, you have a compromised machine with radios sniffing inside your environment.

</comment></comment><comment><USER48> Ipads where never meant to be computers. I mean just look at the new Ipad commerical with the little girl. This is made worse by the fact that it's completely locked down. You have no way to fiddle with it. If Ios was free software people could develop for the ipad so it could continue to do the things people expect of it, but it's not.

</comment><comment><USER49> I took a broken hard drive to the electronics recycling bin in the basement last month. It's not often emptied, as it takes a long time to get even half- full.

Inside was a Macbook Air, a 2012 iPad, an iPod Touch, two 8GB iPods and an iPod Shuffle.

All except the Macbook are in full working order, but the iPad and iPod Touch were frustratingly slow to use.

</comment><comment><USER50> Curious how old the author is. Those of us who had computers in the 80s and 90s remember how 3 years or so was what you got before obsolescence set in. Mobile devices are still developing at that kind of rate. Desktops and laptops last so long because for 99% of needs they maxed out on necessary specs many years ago.

</comment><comment><USER51> iPads age better if you disable javascript st some point.

\--

Sent from a 1st gen iPad.

</comment><comment><USER52> My older iPad (yes, first gen iPad from 2010) is eight years old and it works great (from my perspective :)

Yes, I can't download most new apps, but last year, I released an update for 'Economy for iPad' (#1 Finance app for several weeks in 2010) and that app continues to support the original iPad and iOS 5.1

Generally, the best way to keep old devices running well is to keep the old OS. (Old major version at its latest minor version e.g. 10.3). There is a slight risk of not being able to pick up security fixes that didn't make it into 10.3, but made it to 11.0. However, as a developer, who tests apps on older OS versions, I keep old test devices with old OS versions on them.

Btw I should also add that Netflix runs perfectly on my old iPad with iOS 5.1 :)

</comment><comment><USER53> I bought a refurbished PC in 2007 for around $400 and I recently put Linux on it and gave it to my mom. It's definitely fast enough for her to check email, watch the occasional Youtube video, and surf Amazon/Craigslist/etc.

</comment><comment><USER54> After all these years, I finally picked up an iPad. It is an iPad Pro 10.5 with the smart keyboard. I like the device, its fast and has good utility for photo editing, like Affinity photo. Should I expect the device to slow down with each iOS update? Does the whole OS slow down or is it specific apps? Is this article accurate? What is the average lifespan of iOS devices, given hardware is taken care of? This is my first iOS device.

Edit:

Has there been a change in how older devices are impacted? For example, iPads before iPad Air are more likely to be impacted by updates. Any iOS device after the A7 chip is now less likely to be impacted.

<comment><USER17> This is a red herring, the real reason why we even get to have this conversation is because Apple provides full OS version updates to devices for _much longer_ than any other mobile platform. Your 6 year old iPad is a bit slow on the latest iOS? Uh, my 6 year old android tablet hasn't seen a new OS in 5 years.

<comment><USER55> 5 years isn't all that long in the world of computers (and Apple is trying really really hard to market iPads as computers).

Any proper computer will be upgradable for way longer than 5 years when running Windows or Linux. iPad won't be because you're not allowed to install your own OS.

<comment><USER17> Not really a fair comparison when you consider that PCs have been plateau'ing in performance for at least that long, while the tablet/mobile market still delivers large performance gains year-over-year.

</comment></comment></comment></comment><comment><USER56> I have a 4th generation iPad from early 2013 that I use all the time. Ironically, it wasn't until about 2 years ago when my wife got me a bluetooth keyboard case for it that I really started to get some use out of it.

It definitely isn't as snappy as it used to be, and the battery reports that it has lost 20% of its original capacity, but I use it all the time.

I primarily use it in meetings to take notes with OneNote, I also use it to SSH/RDP/VNC into other computers to write some code and such. I also have some means to work on code using a git app and Textastic. Yes, there are such apps available for iOS.

GarageBand and iMovie get some usage when I'm feeling "artistic" though I will admit they are starting to get too sluggish (GarageBand especially).

As far as games go, I mostly stick to the knockoff bargain-brand versions of big-budget games by Gameloft; Order and Chaos 2 (Guild Wars 2), Modern Combat (Call of Duty), Gangstar (GTA), Minecraft Pocket Edition, and retro game collections (Atari, Activision, Vectrex). I have a number of Bluetooth controllers that are compatible with those retro game collections that helps. I used to have my iPad jail broken and would play tons of emulators on it as well.

The main thing that's nice about something like an iPad with a keyboard is that with a bit of work it can completely take the place of your laptop and do it better. When I go away for a long weekend, I inevitably have to ask myself if I want to take my laptop or my iPad. It always boils down to how much I think I'm going to have to work, and usually it's the iPad I take. It does 90% of the day-to-day things I need to do, still has a relatively great battery life, and it's the size of a notebook even with the keyboard-case. And if things come down to it, I can still access my work computer or my webserver at home and do the whatever else I need to do (albeit in a less than ideal manner, but I've never had to say "sorry, I can't look into this right now cause I only have my iPad").

I will admit, it's the addition of a physical keyboard that really does it for me on the iPad. But keyboard or not, even within the Orwellian App Store I can be extremely productive with my 5 year old iPad.

And yes, I wrote all this on my iPad.

</comment><comment><USER57> I've been using my nexus 7 2012 model, and work commissioned a bunch, so I ended up with 4 of them.

So I hit xda, grabbed slim OS 4.4.4 and lineage 7.1, both run fine. Gave my extras to my kids, runs youtube at 720 fine, browse fine. Only had to buy 2 batteries for 12 bux each.

We had an old Ipad gen 1 that because totally useless with apples market. Doesn't appear Apple handles older versions like the Google market, showing files that are supported by your version. Kinda sad.

<comment><USER58> Not sure what you mean.

iPads command better resale prices.

iPads are usually faster than the competition (CPU/GPU wise for the money for equivalent high end models)

iPads usually get more OS updates than Android tablets get (tons of which are left with the same OS that they came out with).

<comment><USER55> iPads also lose app support significantly faster if you don't upgrade to slower newer version of iOS - app developers drop support significantly faster than they do on Android.

</comment></comment></comment><comment><USER46> For the more tech savy this is where an open source operative system would make the difference (iAndroid). Though Apple should provide some sort of alternative for the less tech savy. One thing is saying that we don't support your browser because it sucks and you have alternatives, the other thing is saying "the 500£ you spent 5 years ago are gone, we don't care the hardware is in good state just buy a new one"

</comment><comment><USER59> The author mentioned repurposing old computers for non-frontline work. Can't you do that with old tablets? Load a bunch of PDFs, pictures or whatever into internal storage, take the tablet offline, use it like a bookshelf in the form factor of a single book?

<comment><USER60> That's basically what I'm doing. But even for pdf browsing it feels sluggish.

I mainly use my ipad as a third screen, placed on a dock to read through pdf books/documents. It feels more natural to read on it compared to the computer screens.

Old ipads can definitely be repurposed as book readers, mp3 players (without spotify) or movie players (with older movie formats)

Maybe I should do a clean install.

</comment></comment><comment><USER61> I have an "iPad with Retina display" in the same boat. It is my media player. I use it to play locally hosted songs. It makes me wonder if I can configure XCode to target it any more (its on IOS8 or 9, which ever was last for that version).

</comment><comment><USER62> While I was reading the article, this appeared in my inbox: [https://i.imgur.com/FbaML9A.jpg](https://i.imgur.com/FbaML9A.jpg)

Retargeting? I did sell them an iPad mini a few months ago.

<comment><USER63> They probably saw that a New York Times article mentioned them and emailed their customer base to catch anyone who was reminded by the article.

</comment></comment><comment><USER64> Will an iPad from today last longer or less long? If the hardware is stabilizing, maybe they'll have more longevity (due to easier iOS compatibility)?

<comment><USER65> The hardware is not really stabilizing, if anything the rate of change in CPU and GPU has been accelerating. Those two things are probably the largest contributers to the treadmill of obsolescence.

Apple has tried to keep the connectors standard, but Lightning will eventually go away. But since they have not moved to USB-C yet (on the iPad side), there is a chance that they will skip that and we will have Lightning until the next major change (probably to USB).

</comment></comment><comment><USER66> Our iPad2 is now useless, mostly because the old models were severely memory constrained. If the mic still worked we could use it for calls however.

<comment><USER67> What I did for my iPad2 was to disable js on safari, which makes a big part of the web fast and usable again, in combination with reader mode. I had Brave istalled for using websites more interactively, and for sites like youtube. It has adblocking without any hardware requirements. If Brave still supports ios 9, you could try that. It will still lag, and certain apps were simply unusable for me (protonmail), but I increased its useful lifespan this way.

<comment><USER68> Some services (like Opera Mini) basically rendered web pages server-side (including Javascript), and served them to low-end phones. I wonder if one can just make the iPad a dumb display/input device, using a PC on the local network to handle all the logic...

</comment></comment></comment><comment><USER69> TL;DR comments in this thread: People use their own anecdotes as proof that 1) PCs don't suffer the same decline, 2) Macs don't actually decline that badly

YMMV

</comment><comment><USER70> What did the author learned?

</comment><comment><USER71> I kind of understand the author's point, but at the same time, there comes a time when any kind of technology becomes obsolete. I still use my 2012 Nexus 7 - awesome tablet when it was released, and it was an entry-level model even then, so to have eeked 6 years of life out of it is pretty impressive. I know the OS is no longer maintained and it's stuck on Android 5.0; this is the price you pay for embedded systems. You own the hardware, but have zero claim over the software that runs on it. I still have up-to-date Firefox, for the time being, but I know at some point I'll lose that and more, and my device will be unsafe to connect to the internet.

In much the same way you wouldn't try to play 4k video on a computer made in 1995, at some point the device's processing power maxes out. It's difficult to strike the balance between power, battery life and cost; Apple like to play the Rolls-Royce card of 'it's enough for you' in this regard, giving you a bit of room to expand in the future, but it's in no company's benefit to make your device last forever. With a device that cannot be upgraded, the best approach for them is to sell you another one.

I think the field of computing is particularly skewed by Linux, how most hacker-types will dig through their box of parts every so often, slap together enough components to build an old-generation system and install Ubuntu on it and voila, a second (third, fourth, tenth) lease on life for an old machine. And that's mostly true; Linux doesn't much care what it's running on, the OS can be adapted to run on anything. But at the same time, the _applications_ running thereon will quickly prove why the hardware is previous-generation; sure, you might get the latest Ubuntu running, but what then? Add Chrome and a few tabs and it's going to start to creak; a few things running in the background and eventually you'll give up. Embedded devices are much the same; at some point, you will reach the limits of the hardware through no fault of your own. It's questionable how much by-design this is, with Apple admitting they silently force the CPU clock down as the battery ages, but even with fresh batteries, application developers will be taking advantage of newer hardware features that don't work efficiently or at all in previous models. Some of it may be progress for progress' sake, but try running a machine with full-disk encryption on a Core 2 Duo, without the AES engine - the new hardware makes a lot of difference.

It is a shame that the device doesn't visually age and when powered off has no indication of its age, but such is the way of the industry; it isn't Apple's way to make devices that last longer than their release cycle, and few companies have ever made much profit that way.

<comment><USER72> > Some of it may be progress for progress' sake, but try running a machine > with full-disk encryption on a Core 2 Duo, without the AES engine - the new > hardware makes a lot of difference.

I have been running full-disk encryption on my Linux boxes since 2003, and the performance hit has never been significant. With an old computer, the most important thing to do with your hard disk is replacing an old hard disk with an SSD. That alone will significantly boost performance, and compared to that, encryption isn't a significant factor.

<comment><USER20> Don't some new drives support encryption in hardware? Presumably that would offset any performance issues associated with disk encryption as well.

</comment></comment></comment><comment><USER73> Maybe it's the battery?

</comment><comment><USER74> its called planned obsolescence

</comment><comment><USER10> And in the end he didn't learn a thing.

<comment><USER75> I dunno. He seemed to catch onto the fact that Apple's business model likes to screw over their users via planned obsolescence. That is more than most people learn.

<comment><USER76> Why pick on Apple here? Are there any Android tablets from 2010-2012 that still see regular use, get software updates, and new/updated apps? Is anyone still using their Blackberry PlayBooks from late 2010? It looks like the Galaxy Tab 2 from 2012 can only be upgraded to Android 4.2.2 Jelly Bean, roughly as current as iOS 5. [https://en.wikipedia.org/wiki/Samsung_Galaxy_Tab_2_10.1](https://en.wikipedia.org/wiki/Samsung_Galaxy_Tab_2_10.1)

<comment><USER55> Why NOT pick on Apple here?! There the most successful tablet manufacturer pretty much leading the direction of industry. Why are you so interested in deflecting their blame? Why do you think it's ok if others do it to?

<comment><USER76> I think it's clarifying to look at tablet manufacturers as a whole. The reflexive complaint of Apple is that their system is too locked-down and limited by their approach to software. However, at the same time, there were Android tablets being made in the same era, and it appears that they also suffer from some similar problems (being only limited to Jelly Bean). If so, perhaps the commonest complaints about Apple's approach to software is off the mark in this case.

All hardware products will suffer tradeoffs, and I don't necessarily find it reasonable to think that tablet computers should always be hardware- upgradeable, if it is at the expense of handle-ablity. The author's lament is that the iPad went obsolete before it broke. The PlayBook went obsolete nearly as soon as it was released. How did those Galaxy Tab 2s do? If the problem is that "it went obsolete before it broke", that's infinitely better than "it broke before it went obsolete".

<comment><USER75> The problem is that it went obsolete artificially in a horribly short timespan, with no alternative way of keeping it going. If Apple didn't lock down their systems, we could keep it going quite easily. I have plenty of Android phones that, while they don't get updates from the manufacturer directly, still get patches by running LineageOS or one of the other variants.

I'm not saying Android is great here, I think it's a terrible system, but it's not nearly as artificially hampered as Apple's stuff is.

</comment></comment></comment></comment></comment></comment><comment><USER77> I think something that is missing from this is that it is no longer safe in this time to use old software. It is an existential threat to your own information, which is increasingly linked to your personal device like a phone or tablet. You will be hacked by a drive by exploit, or a mutant ad network. Its no longer about risky behavior, simply existing today online with old software can put you at grave risk.

How long should apple support these devices? 5 years seems reasonable, and very few vendors of hardware offer anything like this.

I agree it sucks, and there is no reason a 5 year old ipad needs to be dead -- but in context this is fine. If you had a 5 year old car that allowed random drivers to stab you in the face remotely, people would replace their cars and not complain that this was a problem.

<comment><USER42> It is no longer safe to use old _browsers_. Old software works as well as it ever did, subject to your OS being able to run it. There is a world of offline desktop software that surpasses the cloud in features and functionality.

<comment><USER77> Cool, please let me know how i can update safari on my ios8 (ipad mini).

You can't -- and in this age the OS and the applications are an indistinguishable blob.

<comment><USER42> Only on mobile. Apple and MS are trying damn hard to make that so on PC but they will never win that war.

You should really be blaming the rapid pace of updates that we have all come to expect.</comment></comment></comment></comment>


Silicon Valley's Radical New Idea: Treat Employees Well - <AUTHOR> https://lithub.com/silicon-valleys-radical-new-idea-treat-employees-well/ <comment><USER2> This really resonated with me. I think it'll be very difficult to move away from the Milton Friedman "businesses only exist to generate profits for their shareholders" model, but if there's one thing that millennials seem to be moving towards, it's treating workers with a shred of dignity. Here's hoping this only gets better</comment>


Ask HN: What posters do you have hanging in your office/room? - <AUTHOR>

I am looking for some great posters to put in the office or just at home. I am referring to something similar to Facebook's 'Move fast and break things'.
Anything startup relevant would be great. If somebody has done something custom, please do share, I know Dwolla has really cool ones done.
Personally, I have Joey Roth's Hustler poster above my desk - http://joeyroth.com/poster2/ <comment><USER2> We have a few prints by Scott Hansen (of iso50.com & Tyco), an old Esso sign, and the cover of SICP under the glass of the workbench.

I also built a screenprint station in hopes of making a few more prints. Motivation comes from all the broken/failed prototypes laying about, not so much by witty sayings on paper.

[http://www.flickr.com/photos/42388170@N06/9704231493/](http://www.flickr.com/photos/42388170@N06/9704231493/)

[http://www.flickr.com/photos/42388170@N06/9704231633/](http://www.flickr.com/photos/42388170@N06/9704231633/)

[http://www.flickr.com/photos/42388170@N06/9707467188/](http://www.flickr.com/photos/42388170@N06/9707467188/)

</comment><comment><USER3> Directly in front of me from the 1970s is a 3x5' Spock ASCII art poster - here's a pic of one - [http://sturgeon.css.psu.edu/~mloewen/Oldtech/ASCII/Spock.jpg](http://sturgeon.css.psu.edu/~mloewen/Oldtech/ASCII/Spock.jpg)

I got a wide column terminal printer in storage, one day I may get it going and print out some others.

Other than that some old movie reproduction posters (Forbidden Planet, Flash Gordon), a few abacuses, some old posters of events I had put on, and other classic computing ephemera.

</comment><comment><USER4> I have an extract from the 57 startup lessons blog post ( [http://www.defmacro.org/2013/07/23/startup- lessons.html](http://www.defmacro.org/2013/07/23/startup-lessons.html) ) on my wall: [https://www.dropbox.com/s/0wl0f67y8rsq3af/StartupLessons.pdf](https://www.dropbox.com/s/0wl0f67y8rsq3af/StartupLessons.pdf)

</comment><comment><USER5> I created a couple posters for my own home office and are selling them online (currently aimed at the swedish market) You can check them out at [http://www.officesugar.com/](http://www.officesugar.com/)

If you're interested in any of them I could probably have them shipped to you since my printing partner are located in the states. E-mail in profile..

</comment><comment><USER6> I commissioned an artist on etsy to paint this on 3 canvasses:

[http://files.stripersonline.com/ubb547/image_uploads4/Calvin...](http://files.stripersonline.com/ubb547/image_uploads4/CalvinHammer1.gif)

I can't wait to receive it

</comment><comment><USER7> Hubble Deep Field:

[http://hubblesite.org/gallery/album/entire/pr2012037a/](http://hubblesite.org/gallery/album/entire/pr2012037a/)

<comment><USER8> Always amazing images to look at.

Here's another good one: [http://hubblesite.org/gallery/album/star/pr2011016b/](http://hubblesite.org/gallery/album/star/pr2011016b/)

</comment></comment><comment><USER9> This site is what you're looking for:

[http://www.startupvitamins.com](http://www.startupvitamins.com)

</comment><comment><USER10> I used to have this: [http://i.imgur.com/Y4dfOeQ.jpg](http://i.imgur.com/Y4dfOeQ.jpg)</comment>


DbKoda – a modern, open-source, next generation IDE for MongoDB - <AUTHOR> Introducing dbKoda! It's an open-source, next generation IDE for MongoDB. Take your database to the next level with a Rich Code Editor, Multiple Connection Management and Topology Tree Explorer. Try it today: http://www.dbkoda.com <comment><USER2> Its really nice. One important thing to note is that it is just the UI and you need to have the mongo in the path to get it work.</comment>


Show HN: Flux and ReactJS implemented in TypeScript - <AUTHOR> https://github.com/mjw56/ruscello

<comment><USER2> Does this actually catch any more types of bugs than vanilla JS React would? (Besides simple things that would be caught in an initial run, like not returning an element from render? Does it catch misspelled props, for instance?) It seems like a lot of increased verbosity to justify any gains.

<comment><AUTHOR> Yes, the props and state are defined by interfaces so if you try to pass in a prop object which does not meet definition of the interface, typescript will complain. I think typescript is not so bad of an option until native ES6 support becomes more mainstream.

<comment><USER3> Btw, flow ([http://flowtype.org](http://flowtype.org)) already comes with React propTypes integration. When you write `x: React.PropTypes.number.isRequired`, it knows how to correctly translate that to static types.

<comment><AUTHOR> flow looks cool. I just have not had time yet to give it a chance. I use typescript a lot at work and I really am digging react on the side so that is why i chose to do this. typescript is nice in that it gives you type checking plus classes, modules, lambdas etc today. I am looking forward to class support for react components (0.13?)</comment></comment></comment></comment>


Cloudflare: soon there will be a customer option to whitelist all Tor nodes - <AUTHOR> https://twitter.com/eastdakota/status/690946456899887106 <comment><USER2> Awesome. I've had just about enough of the bullshit captcha. Hopefully it's marketed as "make it easier for users from oppressed regimes connect to your website".</comment>


How much startup stock options are worth - <AUTHOR> http://www.danshapiro.com/blog/2010/11/how-much-are-startup-options-worth/ <comment><USER2> This is a fabulous article and I only want to add a tiny little bit of additional context:

* Exits north of $100MM are rare, and a $400MM exit is rare indeed; virtually any such exit will be from a famous company. Valuations are at least somehow tethered to sales, and companies that justify mid- 9-figure exits can usually consider IPO... as an example of how rare that event is.

* In most sectors of the industry there are rule-of-thumb valuations based on multiples on sales. An enterprise software company aiming for a $150MM acquisition is expecting 4-8x, and needs to be achieving 18MM (optimistically) to 40MM (conservatively) sales to do that. You can reconcile this estimate by asking for current sales, this year's "number" (in a well-run company, everyone knows the number), and then asking "what's going to happen to scale the number up".

* Last time I had to think pragmatically about VC, a round that took participating preferred shares (in which the VC takes their money off the table, _then_ takes their percentage off the table) was an indication of a weak round; if they're shooting for the moon, you're entitled to hold that against them.

* Finally, remember that _if you quit, the equation changes again_. When you leave, you can execute your vested options, but that costs money. Perhaps nobody in the company is less protected than _former employees_ : investors have contractual provisions to protect their money, and employees are given retention grants, but former employees can be written right out of the deal. I've seen it happen.

<comment><USER3> Great comment, thanks.

 _former employees can be written right out of the deal_

Can you elaborate on this? How does this work? As a holder of a lot of common stock in an increasingly VC-dominated company, this is interesting to me - surely if I buy my shares, I have that proportion of the company with the same rights as any other common stock holder? What about a "normal" acquisition deal could change that?

<comment><USER4> Key phrase: tyranny of the majority.

You can bet that the founders and VC's (or other institutional investors) own a super-majority of the shares. Therefore, they can simply write the rules to give themselves whatever they want. For even more fun, sub-groups of VC's can team up to force out founders or other VC's.

One way this is typically done is to increase the share count by 10X, then sell these new shares for 10 cents on the dollar to a sub-group of new investors.

As an existing shareholder, you MAY have the right to buy into such a deal, but only if you are a "qualified investor", meaning that you have substantial liquid wealth. Otherwise, you'll be left sitting on the sidelines.

Even in a "normal" acquisition, the current shareholders will have to vote on the deal, so it's not uncommon for the large shareholders to cut lucrative side deals with the buyer that give them much more profit than the average shareholder.

<comment><AUTHOR> One mistake in the above: the right to participate in future financing rounds has nothing to do with qualified investor status, and everything to do with whether your agreement guarantees it. Good CEOs will often make sure all their investors are given a chance to participate (because it's the right thing to do and reduces the chance of one class of lawsuits) but it's only a guarantee if your documents say it is.

<comment><USER2> I was locked out of an investment round at one company because of qualification status. I'm pretty sure being meeting the accredited investor standard actually does matter, at least if you're not an employee and the round involves an exchange of money for financial instruments.

<comment><AUTHOR> If your agreement had guaranteed you investment rights you would have had them. Since it didn't, it was at their discretion, and they could have used many different criteria to make that decision. Now as a general rule, when you have an option in the matter, you don't want non-accredited investors in your deal. But assuming that accredited status grants follow-on investment rights (or that lack of them prevents it) as a rule is wrong.

</comment></comment></comment></comment></comment></comment><comment><AUTHOR> I didn't want to clog the article with an explanation of each of the heuristics I provided, so here it is in the comments.

#1 is pretty self-explanatory.

#2 is the expected value, halved because an awesome startup with every chance of success still fails half the time. If you're swinging for the fences (shooting for IPO), you're way more likely to either fail or get so much preference ahead of the common that you never see anything.

#3 is because everyone underestimates the amount they'll need to raise.

#5 The huge penalty is for two reasons. One, because it's tremendously bad for the common. Two, because it often means something worse: the company's up against a wall, the CEO's a bad negotiator, everyone's expecting the common to be worthless so they have to make it up in preferences, etc.

#6 Again, the direct impact isn't as bad as this makes it out to be, but a CEO who does a good job negotiating preferences is a leading indicator of other good things: s/he knows how to generate demand for the company, has leverage, knows how to squeeze every ounce out of a deal, etc. This is basically a proxy for if the CEO will do well during negotiations to sell the company.

#7 A common-dominated board will tend towards common-friendly exits, and indicates a CEO who does well in negotiations. Again, this is all guesswork, particularly trying to figure out the all important "will the CEO do a good job selling the company" factor. But I think it's a decent swag.

</comment><comment><USER5> Does anyone have any advice on how you're supposed to tactfully get all the info required to do this computation?

During my recent job search, I received offers with options from companies who refused to tell me what the count of fully diluted shares was. No one was particularly comfortable answering questions about expected exit. When I tried to ask various questions to estimate some kind of ballpark value for the equity being offered, one company took this as a signal that I wasn't sufficiently enthusiastic about the offer or optimistic about their chances for success. They then started saying things like "We want to hire someone who's really excited to join our team..."

Ultimately the I had to use the "assume the options are worthless" stance, but then, with cash compensation being the only consideration, I ended up accepting an offer with a significantly more mature company.

How are you supposed to get this information while not giving the prospective employer the impression that you're either (a) too skeptical of the company's prospects or (b) too motivated by the money?

<comment><USER6> If they won't even tell you the # of fully diluted shares, I'd run away fast. Sounds like you made the right move.

<comment><USER2> I might not _run_ (this is unfortunately a common practice), but I would be explicit in negotiation that you value an options grant without that information at $0.00. You can say that politely, or even apologetically, but make it clear that you'd give some flexibility on salary or paid vacation days in exchange for more information ( _don't_ be specific about this though).

<comment><USER7> _make it clear that you'd give some flexibility on salary or paid vacation days in exchange for more information_

I disagree. You shouldn't trade anything for the information. A company should make the information available if they want the value of the options to be considered greater than $0. You are _already_ considering trading some salary for the options, but the onus is on the offering company to make enough information available to convince you that the options are worth it.

<comment><USER2> Your argument is principled but not very pragmatic.

When a potential employer gives you anything they consider "significant" equity (ie, worth mentioning as a major part of your comp plan), they are implicitly discounting your salary to make up for it. If you accept their offer, you have _given_ them salary flexibility without receiving consideration.

In reality, information is very much something that negotiating parties exchange. But, I agree that you should reasonably expect enough information to value your equity if equity is a major part of your comp. All I'm _really_ saying is, make it clear to your counterparty that the lack of information about your equity is raising your negotiating floor. Which, logically, it must.

But I am also specifically _not_ saying, "offer 5k off your salary in exchange for valuation information".

</comment></comment></comment></comment></comment><comment><USER8> I generally assume they're worth exactly zero million dollars a piece, because that's what they're actually worth. A few places I've been have tried to pass off this whole "half your salary in stock options" rubbish while still giving me an acceptable wage in real money. This put a phantom value on stock options. At best, they're an exit bonus, which is an incentive to do your best to make your company thrive. It gives you a token that could be worth real money if everyone pulls together.

Don't expect anything from stock options.

</comment><comment><USER9> I really appreciate this article. Unimaginably, most programmers I interview to this day in late 2010, react primarily to number of shares an offer includes option to buy. I've written offers with (made up numbers) option to purchase 10,000 shares at a strike price of $0.10 and had candidates, asking no questions, attempt to negotiate for 20,000 shares which is something that they'd be more comfortable with.

In my admittedly limited experience, just realizing that there are a number of shares out there (fully diluted or not!) and that this grant translates to a percentage of the company and that the strike price implies a valuation is beyond a solid majority of people I've seen receive stock option grants. Articles like this one are certainly needed to improve education on these matters.

<comment><USER10> I don't see what's so horrible about that. By the time you get to the offer, you have an idea of the current valuation of the company. The price * options = $1000 already tells you if the company can grow 25x, you'll make on the order of $25k.

Or maybe you're just saying who the hell bothers to negotiate over $1000 over 4 years. I guess that's a valid point.

<comment><USER9> As the other commenter pointed out, that's not my point. If I issue a billion shares and offer you stock options at a $0.10 strike price you can't really expect the company to grow that 25x . It's an entirely different matter if there are 50,000 shares.

You may be assuming that the strike price is fairly pegged at a real value of the company and thus you can make assumptions about real growth of the company in terms of multiple. Short of public markets, this is always a questionable assumption, but in the case of new startups it is almost completely arbitrary. When you start a new one, there is no reason to differentiate between choices in the number of shares varying by a factor of 10,000x or more, and strike prices are almost as flexible.

Perhaps the best reason to pick any number is to pick a large one because of the (irrational) psychological impact that your large absolute number of shares will have in option grants.

I suppose this emerges out of people's naive appreciation of public markets. Smaller companies often have stock prices in the teens. Mature, stable companies tend to hold prices closer to a hundred. Blockbusters like Google go to 400! Etc. These prices are managed with splits and have little to do with the return captured by owners of the stock, but people looking at it from the outside sometimes miss this. That's why I appreciated the article so much. It goes beyond these simple matters.

</comment></comment></comment><comment><USER11> I'm at a startup (that I otherwise like) where the CEO refuses to disclose the total number of outstanding shares. You can bet that I compute the expectation value of my options to be exactly zero.

</comment><comment><USER12> Employees should consider their options to have an expected value of $0. (With a not insignificant variance...)

There are so many ways things can fail to pan out or you can get screwed, and employees simply can't protect themselves in the way an investor or founder can. If significant participation in an exit is important to you, the only logical option is to be a founder yourself. Trying to get a payoff as an employee is little better than gambling.

My rule of thumb is that if the options influence your behavior at all, you're over-valuing them.

</comment><comment><USER13> In the first .com boom I worked for a company that had a 60 million funding round. By the time I left I decided not to bother exercising my options for pennies a share. The company never went public. None of the many people I knew working for startups at the time saw a dime of profit from their options either.

The stock I got from the much larger, already public company I worked for next turned out to be worth a nice chunk of change though.

</comment><comment><USER4> What you REALLY want to know are things that you're not likely to find out in your offer:

* How does your share allocation compare to your peers, superiors and subordinates? In other words, are you getting an equitable share in the company for your position?

* What is the board's strategy for maintaining employee ownership in the face of dilution? Regardless of what you start with, it can be made irrelevant as the number of outstanding shares goes up in future financing rounds. It is natural to expect your ownership share to go down over time as the company grows, but additional share grants can mitigate that effect.

<comment><USER2> It is simply irrational to value an offer of employment relative to what existing employees received.

</comment></comment><comment><USER14> When people ask me this, I always run away crying. Finally I can point them somewhere.

</comment><comment><USER15> With all due respect on this formula, it is only one instance of many possibities. There are numerous assumption being made. The range of outcome can easily be 10x different (with the mode being 0 obviously).

Could it gives a more reprentative picture if we can do a survey on successful exit? Something like glassdoor.com?

Also i've heard really good story happened to the talents in talent acquisition situations. I wonder if the number can turn out better in those cases, especially for non-founder and non-exec.

</comment><comment><USER16> The frustrating thing about this is that you rarely ever hear about early employees getting filthy rich, even in HUGE companies.

This is why starting your own company and going for broke seems much more appealing, as having 10-20x what your first employees might have is really a game changer. Couple this with the fact that many first employees may end up doing much more work than the founders, and things can get really perplexing.

</comment><comment><USER17> This could be a course for high school students -- like a 1 semester AP course. Understanding stock to me is like a multidisciplinary life skill.

</comment><comment><USER18> Sometimes it's not worth to work for stock options. <http://www.youtube.com/watch?v=hyM3HVdH1Kw>

</comment><comment><USER19> Love the simple equation - really calls into clarity what is a very fuzzy subject.</comment>


Osama's Compound On Google Maps - <AUTHOR> http://maps.google.com/maps?q=osama+bin+laden+&hl=en&view=map&mcsrc=google_reviews&num=10&ie=UTF8&start=20&cid=11196890339658103699&t=h&ll=34.187451,73.242749&spn=0.001742,0.002384&z=19

<comment><USER2> This is the one:

[http://maps.google.com/maps?f=q&source=s_q&hl=en&...](http://maps.google.com/maps?f=q&source=s_q&hl=en&geocode=&q=military+academy&aq=&sll=34.185074,73.270311&sspn=0.027833,0.055747&ie=UTF8&hq=military+academy&hnear=&ll=34.169251,73.242615&spn=0.00174,0.003484&t=h&z=19&iwloc=B)

referred to in the BBC story here:

<http://www.bbc.co.uk/news/world-south-asia-13257330>

</comment><comment><USER3> Be sure to click on the "A" and read the Google reviews.</comment>