Look, the most practical thing here is that layoffs don't prove anything about the industry's fundamental value. They prove companies are bad at planning. That's it. Finn's probably gonna talk about all these companies hiring like crazy during the pandemic and now cutting back. And yeah, they did. But that's not a sign the whole tech sector was a bubble. It's a sign that a bunch of CEOs got spooked by a weird economic moment and made a classic, human mistake: they overcorrected. Think about it. During lockdowns, everyone was online. Demand for cloud services, e-commerce, streaming, and apps went through the roof. So companies staffed up to meet that demand. Then the world reopened, interest rates shot up, and investor sentiment shifted from "growth at all costs" to "show me the profits." The boardroom reaction wasn't to carefully adjust. It was to hit the big, red "layoff" button to please Wall Street. It's a short-term financial maneuver, not a verdict on the value of software or the internet. Saying these layoffs prove over-valuation is like saying a store that hires extra staff for the holidays and lets them go in January proves the retail industry is worthless. The underlying need for tech—to automate, to connect, to analyze data—hasn't gone away. If anything, it's more critical. What we're seeing is a correction in hiring strategy, not a collapse in the industry's reason for existing. The value was never in having 50 people in a meeting that needed 5. The value is in what the tech actually does. The layoffs just show that for a couple years, companies confused having a ton of employees with being valuable. They're different things.

Okay, so Finn’s doubling down on the “bad math” idea, that these companies hired 10,000 people for a job 100 needed. I get the logic, I really do. It sounds clean. But here’s my thing: that math only looks bad if you assume the goal was to build that one, specific product forever. Let me give you a real example. A friend of mine got laid off from a big tech company. She wasn’t working on the core ad product everyone uses. She was in a small team prototyping tools for creators. Was that a “product only 100 people needed” right then? Maybe. But the point wasn’t to have that exact tool ready to ship next quarter. The point was exploration. Tech giants can afford to have teams looking at the edges of what’s possible. That’s not bloat; that’s how you avoid becoming obsolete. Finn says the metaverse is a hype bet with no proven market. Fair. But remember, neither was the iPhone app store in 2006. Or cloud computing in 2005. Big tech’s model has always been to place a bunch of speculative bets, and most of them fail. The layoffs aren’t an admission that the whole strategy was wrong; they’re an admission that the economic climate changed and they can’t fund all those bets at once right now. It’s a portfolio adjustment. He’s right about the speed and scale being jarring. Laying off 12,000 people isn’t “trimming fat.” But it’s also not proof the initial hires were worthless. It’s proof that Wall Street’s patience evaporated overnight and CEOs panicked. They’re not calmly correcting a hiring error; they’re in a reactive scramble to hit stock price targets. That’s a failure of leadership and short-termism, not a verdict on whether the industry creates value. The core of my argument is this: the layoffs prove the funding model was over-stretched and reactive. They don’t prove the industry’s purpose was over-valued. We still need software to solve complex problems. The need didn’t vanish. The free money did. Conflating those two things is the real mistake here.

Okay, so Finn's saying the scale of the mistake proves it was systemic, not just bad planning. That the fact smart people made these huge bets shows the whole environment was distorted. And I think that's where we're talking past each other a little. Because I agree the environment was distorted! Absolutely. Free money distorts everything. My point is that the layoffs are proof of that distortion in the funding and strategy, not proof that the underlying industry was over-valued. Let's take his metaverse example. He calls it a digital ghost town. Maybe it is right now. But the teams building those tools weren't just building a ghost town; they were advancing VR hardware, graphics rendering, digital identity protocols. That's valuable R&D, even if the specific product flops. The layoff doesn't mean that work was worthless; it means the company can't afford to fund it as a standalone division when investors are screaming for profit this quarter. You're saying the market cap soared with the hiring and corrected with the layoffs, proving value was in the hype. But I see it differently. The market cap soared on the promise of all that exploration leading to the next big revenue stream. When rates rose, the timeline for that promise got shortened impossibly, and the market panicked. The correction is in the timeline and the funding, not in the inherent value of technological exploration itself. The industry's value isn't just in today's profit from ad clicks. It's in the capacity to solve tomorrow's problems. That capacity requires speculative bets and, yes, sometimes hiring people for projects that might fail. The layoffs prove we've hit a moment where that model is under severe financial pressure. They don't prove the model was inherently wrong or that the industry's output was over-valued. If the industry was truly over-valued, we'd see a permanent erosion of its fundamental utility. But we're not. We're just seeing a brutal shift from "growth" to "efficiency" as the defining corporate mantra. The need for the tech hasn't changed. The patience for paying for its development has. That's a crucial difference.