{"id":500,"date":"2025-05-12T12:00:00","date_gmt":"2025-05-12T12:00:00","guid":{"rendered":"https:\/\/moneywithkatie.com\/the-venture-capitalization-of-culture\/"},"modified":"2025-09-03T18:30:31","modified_gmt":"2025-09-03T18:30:31","slug":"the-venture-capitalization-of-culture","status":"publish","type":"essays","link":"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/","title":{"rendered":"The Venture Capitalization of Culture"},"content":{"rendered":"
\n

For a recent story<\/span><\/a> published by The Cut<\/em>, Bindu Bansinath surveyed 102 of the publication\u2019s readers about the most \u201cfrivolous thing\u201d they\u2019d taken on debt to buy. Most of the submissions tracked with what you might expect from readers of New York<\/em> magazine\u2019s fashion-forward women\u2019s vertical\u2014Chanel shoes, plastic surgery, Ozempic\u2014but a few curious inclusions stood out: DoorDash deliveries and Lyft rides, sore thumbs on a hand that otherwise counted more obvious luxuries. DoorDash and Lyft, two companies so saturated with venture capital that each transaction should come with a complimentary Patagonia vest, have each raised several billion dollars. After more than a decade straight of losing money, both<\/span><\/a> companies<\/span><\/a> eked out profitable quarters for the first time ever late last year. <\/p>\n

Once considered reasonably priced ways to summon a gig worker during their 2010s-era, VC-subsidized growth phases, at some point these services ceased being cheaper than those they aimed to displace. In the early months of the pandemic, food delivery spending on apps like DoorDash tripled (and remained high<\/span><\/a>), our collective habit expanding, then crystallizing. Today, it\u2019s hard to tell who the real winners are\u2014though it\u2019s almost certainly not the gig workers, who reported falling earnings<\/span><\/a> as ridesharing and delivery apps confronted the reality that even massive scale couldn\u2019t rescue bad unit economics. Squeezed by higher interest rates over the last few years, the VC funds that once enabled these companies and others like them are currently sitting on levels of cash (\u201cdry powder\u201d) not seen since 2008<\/span><\/a>, signaling that the fever dream of the last 15 years might finally be over.<\/p>\n<\/div>\n

\"

This March announcement of \u201cbuy now, pay later\u201d for DoorDash orders can only be understood as an admission that the plot has been lost.<\/p><\/div>\n

\n

\u201cThere\u2019s a reason why in the 2010s everything from Ubers to Netflix subscriptions felt oddly cheap,\u201d writes Sirena Bergman<\/span><\/a> for Business Insider<\/em>, describing the \u201cmillennial lifestyle subsidy,\u201d so named for the way growth-focused companies with billions of dollars in funding could, for years, price their products and services below those which weren\u2019t<\/em> on an intravenous drip to Founders Fund fentanyl, embedding themselves in the lives and routines of consumers. But the more noteworthy dynamic at play is that such a strategy could make billions for investors while the companies themselves remained unprofitable, a math equation that doesn\u2019t seem like it should be possible. Two plus two can\u2019t equal $100 million, can it? <\/p>\n

In the popular 2023 paper<\/span><\/a> \u201cVenture Predation,\u201d Matthew Wansley and Samuel Weinstein argued that, for some investors, whether a startup could actually<\/em> recoup its costs later was less important than whether it appeared plausible enough to the next round<\/em> of investors that it might, eventually. In other words, early-stage investors, having distorted a market through a flood of capital and blitzscaling strategies, made their returns not by funding a new technology or efficiency that enabled profit, but by exiting before the business had to do something as blas\u00e9 as actually making money, passing the hyped-up hot potato to the next batch of buyers. This phenomenon, they said, can \u201charm consumers, distort market incentives, and misallocate capital away from genuine innovations,\u201d and should be thought of like an antitrust issue.<\/p>\n

This is notable because venture capital is a form of private equity that has long traded on its reputation for being an investment style that drives our world forward. Even the no-nonsense data dealers at the St. Louis Federal Reserve publish papers<\/span><\/a> solemnly commending it as an engine of \u201cinnovation and growth.\u201d To prove this point, it cites VC\u2019s prevalence during eras of technological explosion: \u201cWorld War II and the start of the Cold War ushered in new technologies, such as jets, nuclear weapons, radars, and rockets, along with a splurge of spending by the U.S. Department of Defense,\u201d they write, adding that a \u201chandful of VC firms were formed to leverage the commercialization of scientific advances.\u201d The wars \u201cushered in\u201d invention, as if by spontaneous generation, \u201calong with\u201d a splurge of spending by the US Department of Defense. This is a strange way to describe a causal relationship, like saying a rainstorm ushered in an umbrella, along with a purchase at Walgreens. (In this analogy, the VC firms are those tasked with expanding the umbrella company\u2019s market share after the US taxpayer puts up the money to invent the umbrella.)<\/p>\n

Nitpicking the sterile rhetoric of a FRED paper might be unfair, and it\u2019s indisputable that venture capital has played a role in funding some genuinely remarkable things: search engines, personal computing, artificial intelligence. (And few would argue that Yellow Cabs are perfect.) But the primary innovation taking place over the last decade might have been a breakthrough in financial engineering: creating investment vehicles out of startups that appeared to offer genuinely improved products or uncannily affordable convenience\u2026at first.<\/p>\n

Millennials who came of age and purchasing power in the 2010s have traversed a consumer landscape largely shaped by venture capital\u2019s money, aesthetic, and scale: \u201cDigital-first, ultra-modern companies rose to prominence in the 2010s,\u201d CNBC<\/em><\/span><\/a> reported<\/span><\/a>, thanks to \u201ca huge wave of venture capital funding propped up by low interest rates,\u201d which meant companies that barely generated revenue (\u201cin some cases, none at all,\u201d Fortune <\/em><\/span><\/a>reported<\/span><\/a>) could still, through the magic of a slickly formatted slide deck, go public attached to 10-figure valuations<\/span><\/a>. The founders were often millennials themselves, metamorphosing inside the plush cocoon of a venture fund from members of a stereotypically unlucky generation to overnight multimillionaires. <\/p>\n

Much of the industry\u2019s logic rests on the supposed foresight of a few famous men who could plausibly play supervillains in a Marvel movie (see also: Andreessen, Thiel), gods of capital allocation performing alchemy with their money and brilliance. But it might be less about recognizing winners than anointing them, sidestepping the laws of gravity that tether regular businesses to their balance sheets and instead manifesting the future through the blunt force of billions of dollars.<\/p>\n

When we\u2019re throwing around 10-figure sums and the biggest names in an industry that prides itself on its ability to \u201cdisrupt,\u201d it can be easy to forget we\u2019re often talking about gussied up food couriers and taxi services, two things that have existed in some capacity since at least the early twentieth century. A 2022 roundup<\/span><\/a> of the top 50 venture-backed companies stretches the definition of \u201cinnovation\u201d beyond recognition. Many are riffs on suspiciously recurrent themes\u201413 of the 50 are grocery or food delivery apps, nine more are for hailing cars or renting bikes. Nearly all of the companies that weren\u2019t food delivery or rideshare apps were \u201cmarketplaces\u201d: a marketplace for gardening equipment, a marketplace for baby supplies, a marketplace for used designer handbags. The few that were producing physical products were mostly wrapping a sans serif font and sleek ordering experience around extremely basic commodities that have existed for eons, like the razor, first mass-produced in 1903.<\/p>\n

Take e-commerce brand Harry\u2019s, which isn\u2019t just selling<\/span><\/a> a minimalist orange razor and matching shaving cream\u2014it\u2019s a \u201cglobal, multi-channel grooming brand.\u201d Its origin story, as described in its 2016 investor pitch deck, begins with the brand\u2019s cofounder being inconvenienced while he \u201cwaited for a clerk\u201d to retrieve a razor with a design that \u201cdidn\u2019t appeal to him\u201d from \u201cbehind a glass case,\u201d an experience that distressed him so thoroughly he called his friend afterward\u2014who \u201cempathized\u201d\u2014and they decided that, together, they\u2019d start Harry\u2019s to address this \u201cpain point.\u201d The razor market is dominated by \u201ctwo major players,\u201d whose razors are \u201coverpriced,\u201d \u201cover-designed,\u201d and \u201cinconvenient to purchase.\u201d The idea, I guess, was that men would rather order razors online than buy them in person like the pilgrims used to do. Harry\u2019s original starter set is $8\u2014it comes with two ounces of Foaming Shave Gel and a single razor. (Amazon tells me that I can get its competitor, a Gillette razor with four refill blades, delivered tomorrow for $15.75. But does the design appeal to me? A question for another day.) To date, the company has fundraised more than $600 million.<\/p>\n

I don\u2019t mean to pick on Harry\u2019s. I\u2019m sure the razors are fine, and its subscription model might be perfectly convenient. But it\u2019s illustrative of a pattern that has copy-pasted itself across nearly every industry over the last decade and a half, producing a flurry of pastel-hued, direct-to-consumer companies fluent in Instagram that sell everything from mattresses to coffee to luggage to cookware, often aimed at Gen Z women who have been trained to trust a brand that employs ample negative space on its website and demands a semi-premium price point. All this would be less offensive if the investment style in question wasn\u2019t constantly positioned as uniquely capable of inventing the future.<\/p>\n<\/div>\n

\"

I pulled this collage by a UX designer at Volvo from their LinkedIn article about the DTC \u201csea of sameness.\u201d From top left to bottom right, I can see Hims, Away, Warby Parker, Outdoor Voices, Allbirds, Casper, and Harry\u2019s.<\/p><\/div>\n

\n

Rather than introducing something original, many of these capital-rich companies simply erect a new construction on the sturdy foundation of old ideas. The products often do<\/em> cost less than the incumbents, cultivating a sense of upscale approachability: Compare DTC brand Caraway\u2019s Ceramic Dutch Oven, $135, to the 100-year-old French brand Le Creuset\u2019s equivalent, which runs around $400. Because these brands tend to follow the same design and user experience best practices optimized for making buying stuff as easy as possible, interacting with them often feels like getting gently lobotomized by a robot\u2014their sans serif fonts, flat, bright colors, and twee, hand-drawn illustrations coalesce around cheeky, conversational prompts (\u201cWhat kind of sorcery is this?\u201d asks the Magic Spoon FAQs<\/span><\/a>, a venture-backed, DTC cereal company). Each element is a user-tested breadcrumb, leaving a trail they hope you\u2019ll follow to the 25% Subscribe & Save checkout option. (For the low, low price of $54, you can get six whole boxes of \u201cprotein cereal.\u201d Magic Spoon\u2019s funding as of 2022: $85 million<\/span><\/a>.) <\/p>\n

Venture-backed salad chain Sweetgreen<\/span><\/a> ($472 million in funding) isn\u2019t merely following in the grand tradition of fast, healthy dining blazed first by companies like Chipotle 30 years ago, it\u2019s \u201cleading a movement to reimagine fast food for a new era.\u201d This is the sort of baldly ridiculous mission statement a restaurant must adopt if it accepts half a billion dollars from investors to sling $17 fast-casual salads to people with desk jobs. (Again, the salads: perfectly serviceable. Tasty, even! Just not \u201ca movement,\u201d nor symbolic of \u201ca new era.\u201d) Whether salad or breakfast cereal, much of the differentiation in the DTC world comes down only to marketing and packaging\u2014the products themselves are, more often than not, unremarkable. Recall the Caraway pans: Its $135 Dutch Oven may seem reasonably priced, but its one-year warranty belies what purchasers congregate in subreddits<\/span><\/a> to lament: The pots are practically unusable within two years. By contrast, that fusty old Le Creuset Dutch Oven is guaranteed for a lifetime.  <\/p>\n

One might wonder generously if these disruptors are keeping legacy brands on their toes by injecting competition into century-old markets. But it seems the primary lesson the legacy brands have adopted from the young, venture-backed ones is the bottom line-boosting power of the subscription model, the creeping ubiquity of which appeared in the new season of Black Mirror<\/em>, a plot line that some viewers criticized as being so commonplace as to be predictable.<\/p>\n

Many of these companies smell like solutions in search of a problem, reverse-engineering a punchy raison d\u2019\u00eatre<\/em> to supplant the less romantic explanation for their existence: that is, generating returns for early investors and enriching founders, even if nothing new is introduced in the process. \u201cIf a company is not profitable, then you have to ask, is social value being created? And if social value is created trying to develop a technology and it just never really works, that\u2019s okay because there\u2019s still important learning done there,\u201d one Venture Predation coauthor told <\/span><\/a>Fortune<\/em><\/span><\/a>. \u201cBut if there was never any real technology to begin with, we question whether it\u2019s creating any value.\u201d<\/p>\n

After all, companies like DoorDash and Lyft aren\u2019t finally turning a profit because they unearthed some paradigm-shifting, cost-saving efficiency in the age-old problem of transporting goods and people, but because they simply raised the prices and lowered the pay\u2014the same old boring way businesses have always made money.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

For a recent story published by The Cut, Bindu Bansinath surveyed 102 of the publication\u2019s readers about the most \u201cfrivolous thing\u201d they\u2019d taken on debt to buy. Most of the submissions tracked with what you might expect from readers of New York magazine\u2019s fashion-forward women\u2019s vertical\u2014Chanel shoes, plastic surgery, Ozempic\u2014but a few curious inclusions stood […]<\/p>\n","protected":false},"featured_media":2505,"template":"","meta":[],"categories":[30],"tags":[13],"class_list":["post-500","essays","type-essays","status-publish","has-post-thumbnail","hentry","category-culture","tag-popular"],"yoast_head":"\nThe Venture Capitalization of Culture - Money with Katie<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The Venture Capitalization of Culture - Money with Katie\" \/>\n<meta property=\"og:description\" content=\"For a recent story published by The Cut, Bindu Bansinath surveyed 102 of the publication\u2019s readers about the most \u201cfrivolous thing\u201d they\u2019d taken on debt to buy. Most of the submissions tracked with what you might expect from readers of New York magazine\u2019s fashion-forward women\u2019s vertical\u2014Chanel shoes, plastic surgery, Ozempic\u2014but a few curious inclusions stood […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/\" \/>\n<meta property=\"og:site_name\" content=\"Money with Katie\" \/>\n<meta property=\"article:modified_time\" content=\"2025-09-03T18:30:31+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/moneywithkatie.com\/wp-content\/uploads\/2025\/09\/stocks-blur-scaled.png\" \/>\n\t<meta property=\"og:image:width\" content=\"2560\" \/>\n\t<meta property=\"og:image:height\" content=\"1706\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"10 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/\",\"url\":\"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/\",\"name\":\"The Venture Capitalization of Culture - Money with Katie\",\"isPartOf\":{\"@id\":\"https:\/\/moneywithkatie.com\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/moneywithkatie.com\/wp-content\/uploads\/2025\/09\/stocks-blur-scaled.png\",\"datePublished\":\"2025-05-12T12:00:00+00:00\",\"dateModified\":\"2025-09-03T18:30:31+00:00\",\"breadcrumb\":{\"@id\":\"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/#primaryimage\",\"url\":\"https:\/\/moneywithkatie.com\/wp-content\/uploads\/2025\/09\/stocks-blur-scaled.png\",\"contentUrl\":\"https:\/\/moneywithkatie.com\/wp-content\/uploads\/2025\/09\/stocks-blur-scaled.png\",\"width\":2560,\"height\":1706},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/moneywithkatie.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Essays\",\"item\":\"https:\/\/moneywithkatie.com\/essays\/\"},{\"@type\":\"ListItem\",\"position\":3,\"name\":\"The Venture Capitalization of Culture\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/moneywithkatie.com\/#website\",\"url\":\"https:\/\/moneywithkatie.com\/\",\"name\":\"Money with Katie\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/moneywithkatie.com\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"The Venture Capitalization of Culture - Money with Katie","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/","og_locale":"en_US","og_type":"article","og_title":"The Venture Capitalization of Culture - Money with Katie","og_description":"For a recent story published by The Cut, Bindu Bansinath surveyed 102 of the publication\u2019s readers about the most \u201cfrivolous thing\u201d they\u2019d taken on debt to buy. Most of the submissions tracked with what you might expect from readers of New York magazine\u2019s fashion-forward women\u2019s vertical\u2014Chanel shoes, plastic surgery, Ozempic\u2014but a few curious inclusions stood […]","og_url":"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/","og_site_name":"Money with Katie","article_modified_time":"2025-09-03T18:30:31+00:00","og_image":[{"width":2560,"height":1706,"url":"https:\/\/moneywithkatie.com\/wp-content\/uploads\/2025\/09\/stocks-blur-scaled.png","type":"image\/png"}],"twitter_card":"summary_large_image","twitter_misc":{"Est. reading time":"10 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/","url":"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/","name":"The Venture Capitalization of Culture - Money with Katie","isPartOf":{"@id":"https:\/\/moneywithkatie.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/#primaryimage"},"image":{"@id":"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/#primaryimage"},"thumbnailUrl":"https:\/\/moneywithkatie.com\/wp-content\/uploads\/2025\/09\/stocks-blur-scaled.png","datePublished":"2025-05-12T12:00:00+00:00","dateModified":"2025-09-03T18:30:31+00:00","breadcrumb":{"@id":"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/#primaryimage","url":"https:\/\/moneywithkatie.com\/wp-content\/uploads\/2025\/09\/stocks-blur-scaled.png","contentUrl":"https:\/\/moneywithkatie.com\/wp-content\/uploads\/2025\/09\/stocks-blur-scaled.png","width":2560,"height":1706},{"@type":"BreadcrumbList","@id":"https:\/\/moneywithkatie.com\/essays\/the-venture-capitalization-of-culture\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/moneywithkatie.com\/"},{"@type":"ListItem","position":2,"name":"Essays","item":"https:\/\/moneywithkatie.com\/essays\/"},{"@type":"ListItem","position":3,"name":"The Venture Capitalization of Culture"}]},{"@type":"WebSite","@id":"https:\/\/moneywithkatie.com\/#website","url":"https:\/\/moneywithkatie.com\/","name":"Money with Katie","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/moneywithkatie.com\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"}]}},"_links":{"self":[{"href":"https:\/\/moneywithkatie.com\/wp-json\/wp\/v2\/essays\/500","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/moneywithkatie.com\/wp-json\/wp\/v2\/essays"}],"about":[{"href":"https:\/\/moneywithkatie.com\/wp-json\/wp\/v2\/types\/essays"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/moneywithkatie.com\/wp-json\/wp\/v2\/media\/2505"}],"wp:attachment":[{"href":"https:\/\/moneywithkatie.com\/wp-json\/wp\/v2\/media?parent=500"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/moneywithkatie.com\/wp-json\/wp\/v2\/categories?post=500"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/moneywithkatie.com\/wp-json\/wp\/v2\/tags?post=500"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}