Venture capitalists, led by firms like General Catalyst, are investing heavily in AI to transform traditional services businesses. The strategy involves acquiring mature firms, implementing AI to automate tasks, and then using the improved cash flow to acquire more companies. General Catalyst has dedicated $1.5 billion to this "creation" strategy, targeting industries from legal services to IT management. However, early warning signs, such as the phenomenon of "workslop" (AI-generated work lacking substance), suggest that this transformation may be more complicated than VCs anticipate, potentially undermining the expected margin gains and slowing down scaling plans.