Paul Graham characterizes marketing strategies designed to intentionally anger people for attention as a tactic of "scammers." He argues that such approaches reveal a lack of long-term focus and earnest engineering, predicting that companies relying on these gimmicks will never become truly massive.

The worst feeling for an investor is not missing a successful deal they didn't understand, but investing against their own judgment in a company that ultimately fails. This emotional cost of violating one's own conviction outweighs the FOMO of passing on a hot deal.

Melvin Capital went from a top hedge fund to down 50% in two weeks because they underestimated the collective power of retail investors on platforms like Reddit. This event introduced a new, unpredictable risk factor into institutional investing, driven by online community sentiment.

Using rage bait as a core product feature, rather than just a marketing tactic, actively repels the potential investors, customers, and talent a startup needs. Successful VC-backed companies must build a supportive coalition, which this strategy fundamentally undermines.

Startups like 'Chad IDE' are moving beyond using outrage for marketing. Their core product differentiation—like integrating gambling into a code editor—is the rage bait itself. This strategy risks alienating potential investors, customers, and talent, who may actively root for the company's downfall.

When an influential institution like YC promotes a company with a "rage bait" strategy on its official channels, it signals approval. This can mislead young, impressionable founders into believing such tactics are a necessary or endorsed path to success, potentially corrupting the startup ecosystem's norms.

The IVF company Nucleus ran a subway campaign with provocative slogans like 'Have your best baby' to deliberately anger a segment of the population. This 'rage bait' strategy manufactures virality in controversial industries, leveraging negative reactions to gain widespread attention that would otherwise be difficult to achieve.

A VC firm's brand can be disproportionately defined by its most controversial investments, even if they represent a tiny fraction of the fund's capital. A single high-engagement, 'slop' company can easily overshadow a portfolio of solid, less sensational businesses in the public eye.

Nnamdi Okike's fund passed on an early Skype investment due to the founders' controversial past with the file-sharing company Kazaa. This 'hair on the deal' created legal and reputational concerns that, combined with the deal being too early for the fund's stage, overshadowed the promising internet telephony thesis.