Tech startups, using other people’s money, to open fun new offices complete with ping pong tables, free catered lunches and boozy happy hours, strikes me as outdated and profligate in light of what we now know about the burn rate – and the increasing failure rate – of so many newbie businesses.

In case you missed some of these:

• Tesla has been burning money at a clip of about $8,000 a minute (or $480,000 an hour). No wonder Elon Musk is having a major, very public, meltdown.
• MoviePass is burning through its funding, even as it continues to grow. An independent auditor said it had “substantial doubt” about the company’s ability to remain in business.
• Uber has burned through $10.7 billion since its launch a decade ago and the losses are accelerating. They lost $1.5 billion in the third quarter of 2017 up from $1.1 billion in the second quarter. For comparison, Uber lost $2.8 billion in all of 2016.. No sign of profits in the future.

Read on below for more on all that’s nagging me (and I’m sure many others) about tech and e-commerce.

 

Shipping Costs Not So Free Anymore

Amazon is facing significant problems with skyrocketing shipping costs so you know every other retailer is facing twice the problems.

• In 2017, fulfillment and shipping costs amounted to 26.4% of Amazon’s net sales, up from 16.6% in 2007.
• Key reason why being a Prime member doesn’t guarantee free shipping anymore. It only applies to certain goods and certain vendors. Very confusing and annoying. Same story at Walmart and Jet.

 

Paywalls

Have written about this before but now half of traditional media sources I run across online have added paywalls.

• Additionally, many sites have their best content only available to subscribers.
• I get it and hope the paywall is enough to keep them in business but it may be too little too late.

 

Apple’s Losing It

My tech guru and good friend, Jamie Dwyer, will dismiss this as silliness but I am increasingly disappointed by Apple’s underwhelming new products, service, and innovations.

• It’s not one major thing but a slew of minor peeves from the dongle to the fact that I no longer trust the company to fix problems.
• They’ve cut service and genius assistance to the bone.

 

Scam Calls on My Cellphone

Mobile scams have quadrupled in the past two years. Not answering any calls from numbers I don’t recognize.

 

Hacked, Compromised Accounts

Every other day, a company comes forward to tell us to re-set our passwords because our accounts have been compromised. Task Rabbit and Twitter both suggested I reset all my passwords this week.

 

Bottom Line.

I love my tech and use everything from apps that make my life easier and more convenient, to shopping online, to social media to get this blog out and to stay connected with friends and colleagues.

BUT, as someone wise once said, “if it sounds too good to be true, it probably is.” I’ve had this queasy feeling for some time that when things are too ridiculously cheap, it is not a sustainable business model. But, like drug dealers, the business model of many of these startups has been to get us hooked on free shipping and absurdly low prices e.g. for Uber and Lyft rides or for free media.

Now, however, in one fell swoop, the rug is being pulled out from under us. Things are getting real. VC money is drying up and the chickens are coming home to roost – and it’s not going to be pretty as we are forced to pay the “real” as opposed to the VC-subsidized price. It also, sadly, rings in the end of UX, “delight the customer” and all those other customer service tropes that tech took to new heights over the last decade.