A nurse pays into her pension.
That pension invests in a VC.
The VC funds an AI startup going after nurse wages.
a16z General Partner Alex Rampell gave a talk called “Software is Eating Labor.” Thesis: the worldwide SaaS market is $300 billion annually, but U.S. labor costs are $13 trillion. AI’s next target is that labor market.
Among the examples: U.S. nurses. AI can’t do CPR, Rampell notes, but it can take over other tasks like post-surgery follow-up calls. The pitch to Limited Partners (LPs), the entities that invest in venture capital firms, is that their capital can now target the $650 billion earned annually by nurses.
A16z’s LPs include CalPERS, California’s largest public pension fund, which committed $400 million in 2023. CalPERS manages retirement savings for two million California public employees, including nurses in public hospitals.
So here’s another — much less talked about — circular mechanism in AI:
Nurses contribute to pension funds.
Pension funds invest in VCs.
VCs fund AI companies targeting nurse wages as a $650B market opportunity.
Rampell isn’t hiding anything; it’s a public video. The pension fund managers are doing what they’re supposed to do: maximize returns. Everyone is operating within their role.1
But I wonder what a nurse watching this presentation would think.
Do they know their retirement savings are used to automate their work?
Would they find this acceptable?
I work in this tech ecosystem, use AI daily, and could benefit indirectly from investments by these same firms.2 I don’t have a clean position from which to judge.3 But I find it strange that this video exists publicly and hardly anyone4 finds it remarkable.
Maybe it’s obvious to everyone else.
Maybe it’s the new normal.
Maybe I’m naive.
But doesn’t it feel wrong — or at least off — that workers fund the automation of their own livelihoods without them or anyone else taking notice?
My original version of this article was much more opinionated, but I decided to apply the “What would the Buddha do?” strategy. That approach helped enormously to make this more of an observation than a moral judgment, which I’m not qualified to make.
I work for a content marketing agency, Animalz, which specializes in b2b tech. While I don’t keep track of their backers, we certainly work with companies that have received funding from a16z and other VCs, hence my indirect benefit from investments by these same firms.
Besides not being qualified to pass judgment on this situation because of my own indirect complicity, I’m also honestly confused about my own role and actions. I’m working with AI daily, I love it as a tool and what it allows me to do, but when zooming out of the day to day, I also see the (potential) adverse effects on society, the environment, and so on. This is especially true after reading Empire of AI, and I am actively working on how to address these concerns in my own work and actions. One thing I’ve decided I can definitely do is at least make others aware of some of the things I notice, this article being one of them, the Claude Carbon app I recently vibe coded another.
The Western Conference of Teamsters has historically screened against PE firms that cut workforces. So at least someone is thinking about this tension, though this was back in 2012.