This is obviously oversimplified but I think this is a big factor:
Singapore is a business masquerading as a country. While it is technically democratic, in practice there are some barriers preventing truly free and fair elections. That being said, the leaders in Singapore are not corrupt and truly do focus on what's best for the country. As a result decisions are made quickly, for the greater good, and are not politically driven. The leadership have the latitude to make decisions that they believe will make the country better. Sometimes these decisions don't have a lot of public support (because people are naturally more short-sighted) but, because of the political system, they don't need to rely on public support.
In the case of Singapore, I think this dynamic has led to a compounding effect of good decisions that have put the country in such a strong place today. You see this similarly with Norway's oil fund; it was likely unpopular initially to reinvest so much money into savings, but today it's paying off where they have a $2T savings account, from which they can withdraw up to 3% annually ($60B) for the needs of Norway.
In my experience (enterprise software), customers buy our products not because we have a moat or some hard-to-achieve technical advantage but because they can speak to us in their words, they know we care, and we try solve their problems quickly.
Just yesterday I was speaking with the COO of a $200M/yr revenue company in the supply chain space. He'd learned Claude Code and built a couple apps to solve internal problems but reached out to talk to us. I asked him "you've been able to build some really impressive tools, clearly you can solve your own problems, why are you talking to me?" And he said "I have a business to run. I shouldn't be coding. I need somebody who understands my business & can solve my problems without taking a lot of my time."
Is there a cheaper way for him to solve his problems? Absolutely. But he wants to put the key in the ignition and know the car will turn on every time without thinking about it. There is an endless list of problems to solve; I don't think software businesses are going anywhere anytime soon.
A really important part of this is the emotional component. When real money is involved, then you will sometimes face actual losses. It’s hard for a human to completely trust the machine in real world trading
I’ve stayed >150 nights at Marriott hotels this year and was pleasantly surprised when Sonder started popping up as an option. But the thing I noticed is that, at least in the markets I visited, it was often MORE expensive than the local 4/5 star hotel. But with the hotel I got the guarantee of breakfast, a good gym, 24 hour reception, upgrades, laundry service, etc. As a result I never booked one.
My feeling with Sonder is similar to that of my feeling with Airbnb: it’s fantastic for those longer trips where you want some extra amenities in the room like a kitchen. But, for general business or short-term travel, I just don’t get it. It no longer wins on price, and it loses by an order of magnitude on convenience. Why not just pick a hotel?
I anecdotally find flight prices tend to follow a cosine wave. Starting high, dipping a couple months before, and shooting back up. You can see these sorts of trends on Google Flights which will show historical pricing for your search query.
And it can be helpful if you’re very flexible. If my dates are very strict then I’ll tend to book further in advance, whereas if I have a lot of wiggle room then I’ll wait it out.
Using that as a template, I would find it difficult to argue against a claim. e.g., the evaluator linked above permits any bumper scratches smaller than 6 inches, or a wheel scratch less than 2 inches. I feel like it permits reasonable wear and tear.
However, the example in the article was for 1-inch wheel damage, which would be permitted by the evaluator, so I guess the AI flags _any_ damage. I wonder how receptive these businesses will be to negotiation and pushback. Maybe they'll capitulate if you push hard enough, but it puts an unfair burden on the customer to argue against unreasonable claims (likely by design to maximise cash collection).
I used to be a devout Airbnb user. I never had a horror story on Airbnb, and I certainly had a lot of very unique and interesting experiences that I've never been able to replicate in a hotel environment. But ultimately I gave up on it because there was too much friction. Strict check-in hours, strict check-out hours, a list of chores to complete before you leave, not possible to check in at odd hours, nowhere to store your luggage, spotty wifi, the list goes on. Previously I defended this friction with the economic argument - hey, at least it's a lot cheaper than a hotel - but Airbnb no longer wins on cost.
That being said, I still use Airbnb but now only for very specific cases - e.g., some friends and I rented a large lakefront cabin earlier this year. Previously it was my first choice and now it is my last.
(I admit as well that I travel very regularly - around 100 nights so far in 2025 - and that a casual traveller may, understandably, have a different perspective)
That’s an interesting question. I think there are a couple of points here.
So, more broadly, you might be asking me “why waste your time selling $100s of furniture?” which is a completely fair question. The opportunity cost of the time spent selling it was far greater than the benefit I got. From a pure optimization perspective it was a bad use of my time.
But also I just moved to the other side of the world and had an apartment filled with furniture that I needed to get rid of. And I am the type of person who doesn’t like waste, so sending everything to the landfill was misaligned with my personal values. And also I don’t work 24 hours per day, so it’s not like this effort takes tome away from working on the meaningful deals.
It would be reasonable to ask “why not give it away for free?” In my experience, customers that pay you nothing are a much bigger burden than customers that pay you something (and, in fact, I find that higher revenue customers are much easier to deal with on an absolute basis).
And then your more direct question: why negotiate at all? Why not just accept the offer and move on with your life? I think your guess is correct: I am a negotiator at heart. I really truly love the hustle, in all aspects of life. It doesn’t matter whether I’m earning $10, $1000 or $100k: I love making deals. And this part of my character is probably a big part of why I’ve been successful in business.
To your final point - the marginal benefit of negotiating vs. being perceived as petty. In all of these situations the audience is different and their lifetime value is different. It would be foolish to negotiate with a $100k customer over $100s; you’re right to assume that the customer might perceive it as petty (and such a move would probably diminish their lifetime value). But, on the other hand, if you sold something to a random person off Craigslist where their expected lifetime value was in the $100s wouldn’t it be foolish to not try to maximize your outcome, especially if it only added a minute or two to the transaction?
There are two fundamental ways to win a negotiation. By "win", I mean achieve an outcome outside the norm, such as an above market rate salary.
1. Negotiate from a position of strength
You pointed out a couple of these, like when you have a strong personal brand (like Patrick) or when the market dynamics favour employees. The former is not something you can control so, when the market is in this place, you should take advantage of it to propel yourself. However, the former is completely within your control. You can spend some time and effort building a personal brand. Many people discount the value of a brand and the effort spent building one, but it totally works. I have marketing-savvy friends who, since early in their career as juniors, spent a lot of time on LinkedIn thought leadership & brand building. And it totally works. In fact, I have one such friend who was recently part of a restructuring layoff (i.e., not related to performance). Because of the brand they built, once they posted about the layoff on LinkedIn, they had 12 offers within a week all higher than their previous salary.
Another area where you can gain leverage is when you already work at a company that wants to retain you. The only time a business will bend over backwards for an employee is when the conversation is about retention. To make the conversation about retention you need to be completely willing to walk, and your negotiating position is strengthened if you have counter offers. To maintain your political capital (which will be important if you stay) you need to be careful about how you play this game. I've worked with people in the past who approached the business confrontationally, saying "if you don't give me $X, I quit" - that strategy only works once. But there are ways to structure this conversation where you don't leave a bad taste in anybody's mouth.
2. Care about something different than your counterpart
Often the person you're negotiating with cares the most about optimising certain metrics. You should try to spend some time figuring out what those metrics are and see if there is something different that makes a difference in your life.
e.g., your employer might be really under the gun about managing fixed salaries. This is very common in a lot of businesses to try to manage their headcount. So they might be more willing to give you a $50k cash bonus compared to a $25k salary increase. Or maybe they're more open to an extra week or two of vacation vs. salary.
This phenomenon has been really helpful for me in the last year. I run my own business, but my business is fully bootstrapped, so I don't have a board or any investors to please. As a result, I'm not as motivated by ARR as other SaaS companies. Sometimes I encounter customers who would rather pay me a 3-4x one-time fee instead of ARR. By making these deals I immediately guarantee what would have otherwise been four years of cash (potentially with a cancellation risk during the term). A VC-funded SaaS business would almost never make a deal like this, because such a deal would not have a material impact on valuation.
Another example - I was moving recently and sold some furniture. I was chatting with somebody who was an optometrist who wanted to buy a few things, which I listed at $200. They offered $100. I countered, asking for the right to use their employee discount, and ended up getting $500 in value.
So you should also spend some time trying to figure out what your negotiation counterpart cares about. Maybe there is an arbitrage where you can both get exactly what you want, instead of needing to find an outcome where one person wins and the other one loses.
I think it's important to start with identifying your bottlenecks, and work from there to determine the solutions you need. In the case of our business, I feel that my time is best spent talking to customers and prospects. These discussions directly impact revenue, retention, product strategy, etc.
So then I start thinking ... what sort of things am I doing that take me away from talking to customers? I spend a lot of time on implementation. I spend a lot of time on administrative sales tasks (chasing people for meetings, writing proposals, negotiating contracts). I spend a lot of time on meeting prep and follow-up. And many more. So I'm always on the hunt for tools with a problem already in mind.
In terms of specific tools...
Claude is a great backbone for a lot. Both the chatbot but also the API. I use the chatbot to help me write proposals and review contracts. I used it to write scripting to automate our implementation process which was once quite manual and is now a button click.
Cursor has been a game changer. In particular, it means that we spend very little time on bugfixes and small features. This keeps my CTO almost 100% focused on big picture needle-moving projects. We are now doing some research into things like Codex/Claude Code to see how we could improve this further.
Another app that I really love is called Granola. It automatically joins all of my meetings, writes notes, reminds me what promises I made, helps me write follow-up emails, and helps me prep for meetings.
Finally, we use an email client called Sedna (disclaimer: I used to work at Sedna) which is fully programmable. We've been building our own internal tooling (leveraging the Claude API) on top of Sedna to help automate different workflows. For example, my inbox is now perfectly prioritised. In many cases, when I receive emails from customers, an AI has already written a draft that I can review and send. I know there are a lot of out-of-the-box tools out there like Fyxer to help with things like this, but I've really appreciated the ability to get exactly what we want by building certain things ourselves.
I wonder if some of this output will take a while to be visible en masse.
For example, I founded a SaaS company late last year which has been growing very quickly. We are track to pass $1M ARR before the company's first birthday. We are fully bootstrapped, 100% founder owned. There are 2 of us. And we feel confident we could keep up this pace of growth for quite a while without hiring or taking capital. (Of course, there's an argument that we could accelerate our growth rate with more cash/human resources)
Early in my career, at different companies, we often solved capacity problems by hiring. But my cofounder and I have been able to turn to AI to help with this, and we keep finding double digit percentage productivity improvements without investing much upfront time. I don't think this would have been remotely possible when I started my career, or even just a few years ago when AI hadn't really started to take off.
So my theory as to why it doesn't appear to be "painfully obvious": you've never heard of most of the businesses getting the most value out of this technology, because they're all too small. On average, the companies we know about are large. It's very difficult for them to reinvent themselves on a dime to adapt to new technology - it takes a long time to steer a ship - so it will take a while. But small businesses like mine can change how we work today and realize the results tomorrow.
Yes. As somebody who has used dozens of metro systems around the world, it is literally the only one that is not ~room temperature. In the summer, it is so uncomfortable on the tube that I almost always take a taxi, even if a taxi is materially slower.
I interpreted the “uninterested in giving … attention” part of that point a bit differently. To me, somebody avoiding socialising is not giving off a superiority complex. I suspect what the author meant is being inattentive while socialising (i.e., not actually listening to you, focusing the conversation on themselves, etc.)
Their 2024 revenue was estimated at $16.8M [1] and $10.5M in 2023. If you extrapolate that growth rate +1 year you can assume it's now $26.9M. Another source estimates it at $15M in 2025 [2].
So if you assume their revenue is in that range, you're looking at 66x to 133x ARR multiple. In today's market that's quite a big markup. Standard SaaS right now is probably more like 5-15x. AI is a lot more (but Supabase isn't AI). But they are a key leader in their market, so probably get a meaningful bonus for that. And I'm sure a lot of big industry investors were competing against each other for the Supabase deal, so that definitely would have helped valuation too. Also, at their maturity today, they are probably showing some great success signing big enterprise deals and telling a story about how that will grow.
That being said, those factors alone don't answer 66-133x. Perhaps Supabase's strongest angle is their opportunity for product-led growth:
- They have a huge number of people on a free tier
- The growth rate of free tier users might be accelerating
- The conversion rate of free tier users to paid users might also be increasing
- They're adding more things that people can pay for, increasing LTV of customers. e.g., for my business, we probably 20x our Supabase cost in the last 6 months - most of that is due to our growth but also there are a lot of things we can buy from Supabase beyond compute.
So I would assume, in addition to the above, they're telling a story about their actual revenue growth rate will accelerate meaningfully because of all of these factors working together.
Lots of assumptions in here, but you can start to see how a lot of different factors + a hype multiple could lead to such a valuation.
Maybe easiest to explain from a software perspective.
So if you build a SaaS app, your company will incur a number of costs. You need to pay AWS for hosting, your support team, your sales team, your annual team retreat to Mexico, etc.
When you start measuring your profitability you then will separately measure the profitability of your product vs. your business.
The profitability of the product is your gross margin - essentially your revenue minus your cost of goods sold (COGS). Not all of your business expenses fall into here - only the costs that directly relate to supporting the product.
So…
- Your annual team retreat won’t hit your gross margin: this cost isn’t essential to supporting the product
- Your AWS costs will hit your gross margin (if you turned off AWS tomorrow, your product stops working)
- Your Slack bill does not hit gross margin
- Your product & engineering team normally doesn’t hit gross margin, but DevOps does (because DevOps is seen as essential to supporting the product while R&D is not)
Now in reality it does get a bit more messy. Businesses might allocate a % of engineering costs to GM to account for essential maintenance and bugfixes.
So the way to look at it is: what costs are essential to the continued delivery of the product and what are nice-to-have?
And then operating margin essentially considers all of the non capital costs. It’s a more comprehensive view of all the businesses revenue and costs.
For a smaller business it’s very normal for operating margin to be razor thin or even negative. Because just one or two engineers could cost more than your entire revenue.
But this entire concept is why software companies have historically been able to be unprofitable for so long. A business that’s losing a ton of money every month might only be losing that money because it’s investing very heavily in R&D. Or maybe it just moved into a new
As you scale the relative impact of a lot of those costs will go down significantly - e.g. your engineering team cost will stop being 300% of your revenue and will start being 20% (you don’t hire engineers linearly with growth).
So the theory is that if you can find a software that has:
- a big market
- great gross margin
Then with just some upfront cash investment you can provide the business enough runway to grow the revenue to the point where the impact of some of these expenses becomes very small. At a certain scale, a product with 50%+ gross margin will be producing so much cash that it can pay for the rest of your operational expenses without further investment.
You will need to sacrifice something. If the regulations become more restrictive, one of the following needs to change:
- cost (laptops getting more expensive)
- quality (laptops getting less powerful / smaller)
- time (manufacturers have a long grace period before they need to implement the regulations, to allow technology to catch up)
Singapore is a business masquerading as a country. While it is technically democratic, in practice there are some barriers preventing truly free and fair elections. That being said, the leaders in Singapore are not corrupt and truly do focus on what's best for the country. As a result decisions are made quickly, for the greater good, and are not politically driven. The leadership have the latitude to make decisions that they believe will make the country better. Sometimes these decisions don't have a lot of public support (because people are naturally more short-sighted) but, because of the political system, they don't need to rely on public support.
In the case of Singapore, I think this dynamic has led to a compounding effect of good decisions that have put the country in such a strong place today. You see this similarly with Norway's oil fund; it was likely unpopular initially to reinvest so much money into savings, but today it's paying off where they have a $2T savings account, from which they can withdraw up to 3% annually ($60B) for the needs of Norway.