Generative AI Is Having Its Herbalife Moment

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Generative AI Is Having Its Herbalife Moment<br>How predatory vibe coding startups are selling false hope to young people

Matthew Hughes<br>Jun 17, 2026

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Photo by Hitesh Choudhary on Unsplash<br>Over the past few weeks, I’ve noticed that TikTok has been serving me ads for Replit — one of the many vibe-coding startups that have emerged in the past couple of years, and that serve as a glorified wrapper for models from Anthropic, OpenAI, and Google.<br>Now, TikTok can be a weird place at times. It’s full of companies trying to sell things to an audience that can not — and will not — ever buy them. Things like industrial-grade glycine, graphite cubes, and lightly-used oil tankers.<br>I usually just laugh at those ads and move on with my day. And, in comparison, Replit isn’t as outlandishly batshit as the idea of someone trying to sell a graphite cube — the kind that looks like it might feel at home in a Soviet RBMK nuclear reactor — to a bunch of hyper-online gen-Z.<br>What We Lost is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

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The ads — many of which were produced by influencers with brand deals, and can be found by searching “replit” and “#ad,” or #replitpartner — typically follow the same format. You have a beautiful person going about their day, having an idea, and then prompting it into existence with Replit.

The message is simple — you, yes you, can make software, and that software might make your life some level of better, or more convenient.<br>Or, that software might become the side-hustle that helps pay your rent, or even, if you’re lucky enough, makes you rich.

Where have we heard this before?<br>History Rhymes

Around the 1920s, the world was introduced to the noxious and hateful idea of multi-level marketing. The way it works is simple — a company will have a product, like health supplements or plastic food containers, and they’ll get ordinary people to act as their marketers and salespeople.<br>There’s very little money in actually selling product. If you want to make real cash, you need to recruit other salespeople. Every new recruit — often referred to as the “downline” typically brings in a one-time bonus, as well as a cut of every bit of product they sell.<br>Obviously, those downlines now need their own downlines. And those third-generation downlines need their own downlines.<br>Obviously, this isn’t sustainable. Eventually, you run out of people. Kind of like a pyramid scheme.<br>Over the following century, the multi-level marketing industry changed. It globalized. We saw the emergence of new MLM companies spruiking wellness drinks with dubious health benefits, shampoos that make you go bald, and more. But while the product (which was never the point) changed, the basic model didn’t. Neither did the incentives for actually joining them.<br>Have you noticed that it’s never rich people that join MLM schemes? It’s always those on the bones of their arse. It’s why a lot of the people joining them are (at least, in the US) undocumented migrants who are otherwise locked out of the formal economy.<br>Nobody joins an MLM because they’re passionate about fucking tupperware or protein shakes, or the company manufacturing them. They join them because they believe that if they work hard enough, they can find the economic stability that otherwise eluded them, and perhaps something more.<br>Of course, only a small percentage of people who actually join them actually achieve that economic stability, and a smaller number still that “something more.”<br>So long as times are tough — that there’s people who feel alienated from the economic system — there will be people looking to take advantage of that alienation.<br>Jesus, just look at the crypto boom of the 2010s. I had a front-row seat for much of it, with my time at The Next Web coinciding with the frothiest, dumbest part of the era. Each day, I’d get around 250 pitches from founders and PR people in my inbox, all asking me to write about their clients or companies, and I’d wager that around 200 of them (or four-fifths) had something to do with crypto.<br>Tell me, do you think that the crypto boom would have happened if not for the fact that people saw a material decline in their economic fortunes and living standards after the global financial crisis, and that they didn’t see any hope of that changing?<br>FTX pitched itself to a mainstream audience, buying the naming rights to sports stadiums and spending big on a marketing campaign that targeted normal people, with Superbowl ads fronted with recognizable celebrities like Larry David.<br>Do you think that mainstream appeal would have been there — or would have been quite as strong — if not for the fact that people were broke, with their spending power eroded year-after-year as inflation chipped away at their stagnant wages? Would Paris Hilton have been invited to talk about NFTs...