Comment by v08n2ywos on Dentistry, Oral Surgeons, and the Inefficiency of Small Markets · 2024-11-02T07:58:01.078Z · LW · GW

There are direct parallels to companies like BetterHelp taking over online mental health. 

The difference is that mental health practitioners make less money than surgeons, customers (or their insurance providers) are willing to spend more on a dental surgery than on therapy. 

The similarity is that once the corporation took over, the corporation is the one who is accountable to both customers and providers, instead of the providers being accountable to customers. If the corporation has monopoly power (or duopoly etc) they can get away with providing mediocre outcomes and mediocre pay to both customers and providers, because they know customers and providers aren’t left with better options in this new world. 

In the dentistry case this might mean providing dentists 50% more pay for 300% more work and shitty bosses, and providing patients with worse care at a 20% cheaper price than what they paid earlier, and lobbying for regulations that make it more painful for a dentist to start a private practice. (I don’t understand the dentistry business myself, this is pure conjecture on my part.)

Someone like Paul Graham might say it’s more profitable over the long run to offer good terms and good behaviour to your customers even if you’re now a founder billionaire. If your objective is world domination he might be right.

But he too agrees you can get away with offering shitty terms and shitty behaviour if your objective is to get rich and cash out your billions within a few years, and not care about what happens afterwards. You will definitely be surrounded by lots of shortterm-thinking investors and shortterm-thinking MBAs who have even less accountability than you as the founder billionaire. Their reputation will get affected zero if your company burns to the ground in the next few years and they too will probably encourage shortterm thinking. 

You can read two sided markets by Sangeet Paul Chaudhary, there is some similarity even with Uber middlemanning drivers and riders or AirBNB middlemanning landlords and renters.