We have all heard the tales, sitting around the fire on a dark and cold night, trying to scare each other with horror stories. The one memory that still haunts me to this day is about creatures so cunning, conniving, so utterly and profoundly soulless, they could talk a man into selling his own shadow for a 2% stake in a future that would never arrive.
They weren’t ghouls nor vampires, though they drained the life from everything they touched.
We were all scared shitless, and hoped to never have to engage them.
We called them…
Venture capitalists
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Centuries long, the Old Blood, the ghoul-kings of the [−Si(R)₂−O−]n.Valley, practiced a patient sort of farming.
They were the original angels, though no angel ever bore such a chilling smile. They would find a young mortal, a founder with eyes full of fire and a heart full of reckless ambition and bestow upon them. . .
The dark gift of capital
This was the first stage of their ancient farming method, sowing the seed in fertile, naive soil.
They would watch as this fledgling grew an company, a flock, and they would nourish it with whispered advice and they would open doors with unseen hands. They tended to their Frankensteinish Artificial creations with limited Intelligence, as a shepherd tends their sheep, knowing all well, the fattening was for a purpose.
Then, once the flock was mature, once it was plump with market share and rich with the lifeblood of human talent, the reaping would begin. The ghoul would descend in the quiet of a boardroom, drain the company of its essence in a glorious liquidity event, and retreat to its sky-rising mountain retreat, fully satisfied by the profits from selling a successful company.
But the old ways had grown tiresome for a few young and power hungry capitalists of venture.
In recent cycles, the young blood has grown thin.
Anemic even.
The startups are frail, and their ideas tasted like empty calories, and they offered no true sustenance.
So the Ancients, the Khosla Coven, the General Catalyst, the Thrive Conclave, have turned their pale, dead, and hungry eyes from the nurseries to the ancient forests. And there, they had discovered the enormous wealth of established corporations.
But they found these are not saplings to be nurtured.
They are old, slow-moving herds, fat and complacent, and their hearts beating with the slow rhythm of stability. Their veins run rich with the accumulated data and deep-rooted processes that the ghouls now crave above all else.
Oh! This is a fuller, and darker meal!
To hunt this formidable new prey, they have crafted a weapon worthy of their ambition. A Golem.
A Simulacrum.
They forge it not from clay and magic, but from the dust of the company they target.
And that dust, with every email, every report, every recorded customer service call, every line of proprietary code in it, is fed into its gaping orifice. And with it they created a corporate doppelgänger, a mirror that learns to perfectly mimic the life it sees, and then, when its education is complete, it shatters the original.
They call this unholy creation “AI”, and its deployment is the “AI-infused roll-up”, and that is a term as sterile as the tomb it was born in.
The AI Golem is a perfect predator.
It feels no pity, no fatigue.
It can perform the labor of a thousand mortals without a pulse, without a soul, and is keeping the corporate corpse walking, talking, and generating revenue long after its human essence has been drained away.
The first true test of this method was a thing whispered about in hushed tones.
This corporate was called Long Lake.
It did not conquer a kingdom though, but it did consume a suburb. In less than two years, it devoured homeowners associations, replacing the messy, human business of neighborhood squabbles with the perfectly efficient judgment of the algorithm. It turned a community into a perfectly regulated, soulless farm, and for this, the ghoul-kings rewarded it with $670 million in tithes.
The test was a success.
The method was proven.
And now for the real story
Khosla Ventures, General Catalyst, Thrive Capital, and solo VC Elad Gil are all experimenting with what they’re calling “AI-infused roll-ups”, and that sounds so much nicer than “we buy companies and fire most of the humans”. General Catalyst is already touting this as a brand new asset class, because yeah, we needed a fancy name for “purchasing businesses and replacing the workforce with algorithms”.
Their North Star is Long Lake, and that’s a company that has been hoovering up homeowners associations for less than two years and has somehow secured $670 million in funding. This presumably means that your neighbor’s complaint about your god awful music will now be processed by a chatbot instead of an actual human who might have the decency to ignore it.
In an interview, Samir Kaul from Khosla Ventures said he is looking at “a few of these types of opportunities”, and he said it with the careful enthusiasm of someone who has discovered a new way to make money that might be slightly morally questionable but hey, returns are returns.
The beautiful thing about this strategy (according to the VCs), is that it creates instant customers for all those AI startups they’re also funding.
Aw chucks. So planet friendly to build a perfectly closed ecosystem of artificial intelligence selling to artificial intelligence, with just enough human oversight to sign the checks.
But here’s where things get really fucking depressing.
Because what actually happens when VCs “optimize” a company with AI?
Well.
Weeelll.
According to people who have seen this process from the inside, it looks a lot like financial cannibalism. Those “investors” gobble up entire companies, digest their human processes, and regurgitate them as “flows of autonomous agents”.
Fast and ruthless, like a nature documentary about corporate predators.
Some MBA graduates who are working in private equity have been sent out with a shopping list to go hunt for acquisition targets with a single criterion: how much “legacy” they can uproot and replace with generative models.
Jeeezz.
Legacy, in this context, apparently means “people who currently do jobs”.
The Amazon example they use, is particularly charming.
Internal documents describe something called Kiro, and that’s an agent that generates code “in real time” and reduces developers to syntax checkers. Imagine asking the best engineering talent on the planet to become human spell-checkers for AI-generated code.
Not to my surprise, you’ll find senior engineers jumping ship, while junior developers are rejecting offers they would have signed with tears of gratitude just a few years ago. Turns out people don’t actually want jobs where their primary responsibility is babysitting algorithms that occasionally hallucinate entire libraries of code that don’t exist.
Because here’s the thing about AI that these venture capitalists seem to have forgotten in their rush to eliminate human workers. . .
These systems are still just very sophisticated autocomplete machines. Brilliant for translation and finishing sentences, utterly inadequate for tasks requiring actual verification or judgment.
When AI hallucinates – and it will hallucinate – it creates “ghost libraries” that can sneak into production code and compromise entire supply chains. But if your organization’s pipeline doesn’t include humans with the time and authority to say “no, that’s completely wrong,” you’re basically inviting disaster while saving money on payroll.
Don’t you just love irony.
Duolingo is the perfect textbook example of how this AI-first philosophy spectacularly backfires. The company started by firing 10% of its external staff after saying that GPT-4 was sufficient for creating and revising language lessons. Then their CEO, Luis von Ahn-us, published an “AI-first” manifesto (for God’s sake – a manifesto – barf!) in which he suggests that schools would be reduced to “simple kindergartens” and algorithms would do the actual teaching.
Even bigger BARF!
As a result, he received a shitload of criticism, boycotts, and the temporary disappearance of their famous green owl mascot. Because it turns out that people don’t love being told their jobs are obsolete by someone who’s never actually taught a language lesson in his life.
The problem isn’t the technology itself, it is the contempt for human skills that accompanies its deployment. These companies approach AI implementation with the maximum efficiency of a bulldozer, and a minimum consideration for what gets flattened in the process.
People have families.
Mortgages.
Lives that extend beyond quarterly earnings reports. The “move fast and break things” mentality works great when you’re breaking websites, less great when you’re breaking people’s ability to pay rent.
And to what extent.
Short term profit.
To replace human workers with algorithms that can do little more than complete sentences with statistically probable words. AI is genuinely excellent for certain tasks, but treating it as a universal human replacement is like using a chainsaw to perform surgery because it’s technically capable of cutting things.
The venture capitalists driving this trend seem to have confused productivity improvements with human elimination. They’re using AI not as a tool to augment human capabilities, but as a machine gun to mow down entire departments while congratulating themselves on their innovation.
What’s particularly galling is the language they use to describe this process.
“Optimization”.
“Streamlining”.
“Leveraging technology for efficiency gains”.
GARGL BARF !!
It is the same sanitized corporate speak that’s been used to justify layoffs since the dawn of management consulting, just with a new wrapper.
The real question is whether these VCs will be able to look themselves in the mirror after their “AI-infused roll-ups” finish digesting their human prey. But let’s be honest – they’ll probably be too busy calculating returns to spend much time on self-reflection.
After all, disruption is just creative destruction with better marketing, and human workers are apparently just another legacy system waiting to be optimized away.
Wish Karl and Friedrich were alive and kicking. We’d see some fireworks.
Signing off.
Marco
I build AI by day and warn about it by night. I call it job security. Let’s keep smashing delusions with truth. We are the chaos. We are the firewall. We are Big Tech’s PR nightmare.
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