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this post was submitted on 10 Aug 2025
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I'm skeptical of AI coding as it exists today, and while I'm bullish on long-term prospects for AI writing software, am very dubious that simply using LLMs is going to be the answer.
However.
Startups typically do lose money. They'll burn money as they acquire a userbase
their growth phase
and transition to profitability later. I don't think "startups in area X tend to be losing money" is terribly surprising.
The issue is mostly energy costs though. Startups do lose money; to hiring new people, marketing, etc... But in this case the entire business case loses money a the moment, and without any significant breakthroughs they likely will keep losing money like that.
Ed Ziltron has a good piece regarding whether the losses are “just another startup” or something more. I am very much leaning towards “burning money at an insane rate just to give the impression of growth”.