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[Music] and they've just gone crazy with them antonio uh eulon had a moment of reflection and uh
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he was talking about 2008 he's talking about the imminent collapse as he felt it of spacex and
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tesla at the same time in december 25th and he said uh there were just a handful
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of people who came out there uh and put their careers on the line for him at your shelf and steve jefferson
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specifically mentioned uh and it was an ira and it was a particularly poignant moment for him he was getting a little
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choked up about it tell us about that bet you made in 2008 and the potentially career ending bet for
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you to bet in an electric car company at that moment take us back to that decision yeah um
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but before i do that i just want to say that i left my wallet uh it backstage because the last time i
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was with the four of you i lost a lot of money and i realized that i better leave i
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better leave all the cash somewhere where you can't get it and then and you also made me cry so i don't i i think i
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might i might cry again now of joy i mean no no it was more like humiliation yeah but uh we were playing poker yeah
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we're playing poker you pulled up homer lucky yeah no so if i if i if i cry again this
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time it will be from uh from a sense of um just gratitude for those moments that we
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got to share so the for us in particular because you know our strategy is so operational
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i was there working on supply chain in the factory and on sales and those in that period along with my partner tim
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watkins and three or four of our supply chain people and we had a major problem in supply chain uh the cost for we had
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to control and you know elon was doing engineering on the very expensive parts we were doing the i called the b parts
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the amb parts and man it was brutal um but it was very clear to us that and remember it was also the middle of
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financial crisis right so we had a treasury portfolio we had to decide we didn't have a lot of capital time these
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are tiny funds 120 300 funds where our capital go where our people go more importantly where
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operating people go and where i would go and we decided to focus on tesla because
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uh first we really did believe in elon when most people didn't and we saw on him something very special
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which i think you probably saw here yesterday that not only is he is a brilliant brilliant engineer you know
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100-year kind engineer he's a man of deep conviction and deep passion and deep compassion
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what he is doing is really trying to bend the arc of humanity for all of us because he really cares
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and that came through to us and we wanted to be on that mission with him and so we were privileged enough to be
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there in a moment time that it mattered and it was really hard man i mean we had
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clients i actually had a client said to me how do i know this is a delorean and i said look i can tell you for a fact we
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are not selling cocaine out of the back of the factory in the cars delorean being the famous back to the
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future car exactly where the owner was trafficking cocaine to underwrite the car exactly
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um i may live in miami being antonio grazie's board not selling cocaine for sure that i'm sure
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uh yeah but no it was uh it was a very it was a crew it was a career betting event for us and it turned out right it
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was right thing to do but yeah for me it was um i'm just deeply grateful for these
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experiences but i mean you really doubled down because you didn't just do tesla you also
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were there in some really critical moments at spacex as well we were although i i tell you um you know we
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doubled down at the time and test we put more money in tesla than the financial crisis and then helped lead a convert
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around there that was really tough for us to do and then put money in spacex but i tell you operationally like in
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terms of capital stack i think there were other people around and and spacex was also running out of money and so we
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put money into spacex operation we were just basically over the years but it was never as
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existential in terms of the operations it was a tesla i mean tesla was truly i think truly existential and because we
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were operating guys and i myself had been a factory manager i worked in auto parts in all parts factory i'd run
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industrial facilities myself we could kind of uniquely add value there in the rocket factory you know we were just
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less valuable but yeah both these companies were going down at the same time and you know the
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amount of stress we were all under was extraordinary but you know looking back on it it's one of the greatest moments
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of my career i mean this sense of fellowship you know one of the i think the great thing about being in our
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business the business we are all in is that we get to back amazing people are trying to change the world and in these
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dark dark dark deep moments we get to go to war for them and it in those moments i call them
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these moments of fellowship where you just care deeply about someone and and passion about the mission and you get to
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make a huge difference like these are the highlights of my career and if you ask my partners they tell you the same
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thing these are the best moments we've had some together three of us have had some together actually we've all had
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some together but here on the stage we had to fight for something you believed in and it's it's a privilege man to do
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it it's a privileged situation it's privileged to be the elon it's been a privilege to be there with with all of
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you at different moments in my career and i'm very grateful for it how um [Music]
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do you feel like you come off of a high after having huge successes like that like how do you stay
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grounded and motivated to try to find the next one if in the back of your mind there must be a little piece that says
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it's never going to be as good as this guy or those two things i mean you know it is it's interesting questions roth i
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think that um there's a couple things in play for us one is we keep going because
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we believe in making the world better we invest in companies that we believe make
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a difference with people we respect and we're values aligned with and that's the
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that's the ethos of our firm right so whether it's large or small we may never find something that's as important as
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tesla spacex again but we will find more great people we will help them you know
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two of our companies here i mean we invested and roll with palmer we have a uh a small investment flexport which
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should have been one of the biggest mistakes the last 10 years of my career is not putting more money in flashboard
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yeah i know we we we had it we actually it's kind of a funny story about we had um you know i'd say kind of a soft
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handshake on a term sheet at say a price of x and softbait came in like two later
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and made it 2x and i had too much price memory to keep going and co-lead it so it was an error but you had you have two
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people on the stage here they're extraordinary entrepreneurs they're trying to make the world better both
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both these companies are really are really great and and making the world much more pretty now post covet and in
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times of war making it much safer for all of us there are people like that out there
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there's more of them they may not be elon you know we probably won't elon our generation but there's lots of great
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people and i'm very optimistic about what's happening now in the economy we're seeing incredible incredible
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innovation with tremendous entrepreneurs in our pipeline so maybe there's another
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one i don't know antonio how do you think about the in the businesses you guys invest in
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there can sometimes be a very long capital deployment cycle before you see any real return in terms
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of you know business value whether it's pharma i know you've done pharma some of these hardware companies where
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there's a big build cycle how much do you need to kind of think about and see a customer and revenue show up before
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you're willing to say hey let's build the big rocket ship to go to the friggin moon and how do you judge and value that
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business and back a team yeah it's a really good question i think it depends it depends on this and the
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sector rim yeah it depends on how we we look at the world trip probabilistically and we're looking for
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companies that we call pro-interpret where the baton roll gets worse so in in the case of pharma or something like
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spacex we'll think about like what is our problem what's our probability tree here which probably lost probably a 3x a
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5x a 10x 100x and and then we'll think about when the capital goes in what is the actual return on capital i
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was watching the talk you guys had with with ryan about what happens to public markets the reality is that
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a business is a machine you put capital on one side and out the other side comes
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return the roic return invested capital really matters and if you're a client of
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a class to be trained investor the way i am we think about that a lot yeah so even though we may be putting a lot of
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capital in the question is what's the margin of being in the back end a company like spacex a lot of capital is
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going in but we know that if it works we believe it will work we're also going to
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have a company has tremendous margins even in the industrial sector because of the industry structure it's in it lives
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in an oligopoly uh inside the u.s and outside the u.s so it's like building sterling same thing capital going in but
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we know that the the margins and the profitability that business on the back end will be very very high and so the
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roic will be very good just sorry are you backing a lot of deep tech startups like companies
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a founder shows up with a powerpoint they're like i need 50 million bucks to make our prototype i mean what happens
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there it depends on the business so as an example um you know we have passed on things uh that are
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um our view going to have margins that are ultimately compared to a low a low level
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right and you know there are i don't give examples here but there are lots of examples of people that are doing things
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in you know i'll call it electric aircraft vtols etc we look at this and say this is going to be a highly competitive
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market these are not nnf1 spacex is an end of one if you compare that to someone making an
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electric vehicle that say electric airplane or electric vtol that will not be nf1 you'll be none of
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many and in end of many business you're ultimately going to have margin competition that's going to make it the
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return on capital goes down to basic industrial margins you know like it won't be that much better than boeing's
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roc or air buses roic because those will be ultimate competitors you you said it
00:09:25
a little too i think superficially so let me just double click and i think antonio brings up i think
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one of the most important principles of investing that is so utterly poorly understood which is roic
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roik return on invested capital most people don't even know what it means how to calculate it no pat over your
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weighted average cost of capital these are enormously fundamental principles when you're running a business
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especially in a moment like this because when the rubber meets the road and you need a lot of money and you run into
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somebody as sophisticated as him he's already worked from first principles to understand it it's really really really
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important to know these things because these are the core foundations of valuation you
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know so obviously dcfs are one framework but roik is incredibly incredibly important especially when you make real
00:10:12
things and you need to spend capex yeah and look in the world and last ten years
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where money is free nobody thinks about this very much we always have thought about it which informs our investment
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model but yeah jamal's right i mean in today's world if you're an entrepreneur and you can show up and say listen i
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have a 50 60 70 return on capital every dollar you give me will yield a 70 return on the back end even though we're
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losing money along the way that's a very compelling case relative to hey we're losing a bunch of money we're always
00:10:36
sure it's gonna happen which is what we hear a lot this this also builds on the question from yesterday which is how do
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you present yourself as you know a young emerging company and cut through all the noise and
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understanding of these things and about future value creation in a moment like this becomes really important as well
00:10:53
even if people will debate whether it's right people give you credit for the intellectual honesty of actually going
00:10:59
there and understanding these things really you see it a lot where companies slip away from first principle so
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you know the first principles on a high margin enterprise software business you can define arr and assume some and
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then people say hey some multiple of ar is your valuation comp like your you know your multiple and then another
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company shows up and the margins are different the growth profile is different the revenue retention is
00:11:22
different it's a services business and they try and use a similar sort of comp and all of a sudden everyone's thinking
00:11:27
about valuation as a function of some industry standard comp as opposed to going back to understanding how did that
00:11:32
comp get created in the first place and what's the nature of the business from which that comp arose and people are
00:11:37
doing things like calling revenue arr you know it's not even subscription revenue and so on and i think that
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happens considerably more and then then that investing cycle just becomes you know
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hey well the next round will be this multiple and you know that's how we'll get our increment in valuation and
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everyone just misses the the core you know proposition of building a valuable business it can generate your
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what's your look through into the economy just from your portfolio companies look we we think i think we're
00:12:00
in our session i mean i don't know if someone's already said this but we're in our session we're in recession and this
00:12:04
will be like my i don't know 100 cycle or something i'm pretty old right like the rest of us here we've seen it we've
00:12:08
seen it over and over again and you know i see david's tweets about go raise two
00:12:11
and half years of money this is correct i mean we're gonna you need enough capital to get through the problem
00:12:15
uh the good news about this recession and you know there are there's some good news here which is
00:12:19
to me if you look at the the macro picture here it looks like if you can look look at
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the amount of federal debt the the state of the consumer and kind of what's happened in the business formation it
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actually looks a little like post-world war ii to me in that in the world in the
00:12:34
world war two period we had the last massive mobilization or demobilization of our economy occurred in world war ii
00:12:40
right that happened again in covet when we change in this case it's like a mini version of remobilization that we're
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restarting the economy we flooded the system with money to get the to kind of buffer the problem and restart the
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economy and now we have inflation but we also have lots of business formation and
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we have new ways of doing work which is what happened after world war ii so i'm i'm i'm very optimistic because most of
00:13:03
these recessions you know to really get inflation down we're gonna have to uh reduce consumer demand and or change oil
00:13:08
prices so for sure we should be pumping on this country i know it's not it's controversial but that's important um to
00:13:14
lower oil prices to get inflation down but the reality is underneath the the numbers there's a lot of innovation
00:13:19
happening and that's what happened kind of post world war ii so i would say we're in a bit of a mini retooling it's
00:13:25
going to be a rough year or two uh hang on it will be a rough year or two but the consumer's in pretty good shapes
00:13:30
they're not over levered we should come out okay and the u.s economy is so resilient man like you know we are all
00:13:36
either one generation from being immigrants or immigrants here i think most of us right
00:13:39
it's the best place in the world live we're the most innovative economy in the world we should i'm super optimistic
00:13:43
what's happening here because there's so much innovation so many smart people working so hard to make things better
00:13:49
i think it's going to be great i think we get the next couple years it's going to be great talk about this um
00:13:54
pumping more oil situation obviously russia's involved in a and we talked about earlier today had a debate about
00:14:00
ukraine um and then you have maybe some folks in the middle east not pumping as much oil as we might like
00:14:07
them to and then europe decided well we don't want to frack here we want you to do that over
00:14:11
there and and then we stopped here and none of us want to see um environmental damage done to the planet but we also
00:14:19
don't want to see dictators take over the planet or the economy come to a halt what's
00:14:25
a reasonable proposal for america yeah and american sovereignty in terms of green and renewables
00:14:34
and maybe pumping some oil so look i we were the first institution investors as a motors so i think i have enough
00:14:41
benefit to say this i believe in green technology okay absolute hundred percent but energy and in the same fund we did
00:14:48
tesla we actually had fracking assets because energy independence isn't well that's incredible really yes in the same
00:14:54
fund fund because then as it is today energy independence is a national security issue
00:15:00
this is not a partisan issue extremely important to understand this extreme importance
00:15:08
yeah it's not about democrats republicans it's about wars in the middle east and the reality is that the saudis are
00:15:15
not pumping opec is not pumping this is terrible for america and they know it they're squeezing their economy
00:15:21
in the 70s and it's absolutely being done on purpose so the answer to that in my mind is twofold one we should have an
00:15:28
error we should be industrial policy in this country but the first thing we should have is an energy policy energy
00:15:32
policy look like this we take all of the background subsidies literally make them
00:15:36
equal and we give let's say 500 billion total 250 billion in in low-cost loans to energy patch for drilling in places
00:15:45
like texas louisiana and an equal amount to green energy and we sprint to a green future at the
00:15:50
same time we ensure that this country is safe and we have energy security in this
00:15:54
country for all the people out there being hurt behind inflation it's a security problem
00:16:02
what do you you guys invest heavily in manufacturing what do you see in terms of the future
00:16:06
of manufacturing the opportunity for onshore manufacturing are there technologies that you guys are excited
00:16:10
about that create an advantage for the united states to build manufacturing capacity
00:16:15
um to service industry here and yeah look i think this thing about we outsourced the entire
00:16:20
entire manufacturing base in china because it was cheaper but the reality is that the if we have been our
00:16:25
the productivity between the kind of u.s and china right now is about eight to one so a u.s worker is eight times more
00:16:30
productive than a chinese worker we found in in cases like tesla where we actually helped read in terms of gdp per
00:16:36
worker yes okay and we helped to in-source the supply chain of tesla why is tesla flooding rated
00:16:42
because i got news for you you actually can make stuff in america and it's made well shocking okay shocking let me tell
00:16:49
you when you put what is that why do we have this narrative that it can't be done and then
00:16:55
we go to gigafactory and you see let me tell you having been done let me tell you why and boy i mean
00:17:01
here's this i'm probably gonna get pillory for saying this but great companies are built by engineers like
00:17:05
elon musk that's a reality of it and they know they want to control their manufacturing we do it here so we can
00:17:10
iterate faster and make the product better the product's good enough you'll sell it for a great margin they get
00:17:14
optimized by marketing people and destroyed by the cfo when you put the finance guy in charge and he's like oh
00:17:19
hey we can get a lower peace bar part by sending it to china but he doesn't understand the iteration cycle of making
00:17:24
that product that guy destroys the company and that's what happened in america bean
00:17:28
counters yeah we put the cfo's in charge for god's sake don't do that [ __ ] these
00:17:31
bean counters i mean can i say that [ __ ] well no and let me say that more engineers let me say that if you if you
00:17:37
if you calculate return on invested capital and you think about this carefully what happens is these long
00:17:41
supply chains to asia they have huge capital deployed but if capital is cheap you do that because the peace part price
00:17:46
is cheaper but if you calculate what happened at tes in particular when you calculate the overall cost and capital
00:17:51
wasn't free because we didn't get any it was actually much smarter to bring it back right so the long term cycle you
00:17:56
make more money the short term cycle you make less money the short-term cycle you
00:18:00
make more money i mean is that another way to think about otherwise you optimize for short-term outcomes you you
00:18:05
improve the you you improve the income statement because you might improve profitably in the short term but you
00:18:10
actually hurt the balance sheet because you set all this capital on the water over to china you're there bringing it
00:18:14
back and your iteration cycle goes down right because you you've got so what you're saying is the product's less
00:18:19
innovative for sure it is but he's saying something really important which is that it's the
00:18:23
financialization of the p l that in some ways led to the decline of american manufacturing in part meaning
00:18:30
if you're a ceo of a business and you construct your employment agreement and it's based on a certain kind of earnings
00:18:36
in a certain period a certain earnings per share the incentive to then drive financialization goes up now the perfect
00:18:44
example of this is if you compare it for example and you did this the comp package that you gave elon in
00:18:50
2018 versus the comp package that any other ceo in america got it was completely
00:18:58
black and white it was it was it was it was opposite land yes and you basically completely said you get nothing now
00:19:05
let's set these extreme goals and then if you can hit it you'll get compensated so much so that you know
00:19:12
when you had glass lewis and i said no right uh the the iss cluster said no but they use in most things and we're being
00:19:19
sued for it to be careful what i say about it but um yeah we had a account package fully boost on equity
00:19:25
appreciation right that required creation new products and look i'm gonna i'll pick on apple here apple is the
00:19:30
first stock i ever bought i was 12 years old my mom actually went to okem bank and bought me a futures app i still have
00:19:35
it in my account to remind me what it takes to build a company steve jobs dies terrible and look then you know tim cook
00:19:43
takes over typical supply chain guy i mean they've really optimized profitability it's unbelievable you know
00:19:49
done a two trillion dollar mark cap or something now but man when's the last time they needed a product airpods
00:19:54
airpods yeah i mean they're pretty great great products great products but i mean
00:19:59
it's not entertainment incredible free cash flow yeah and they aggressively buy back their stuff yes
00:20:03
it's in the financialization of that company yeah has attracted i mean like if you look at a com if you could look
00:20:08
at a the largest shareholder is the most sophisticated financial asset owner in the world berkshire yes berkshire
00:20:14
doesn't buy technology companies they buy incredibly well-run financial assets and it is look at how duck's getting
00:20:20
land-based for the vr investment some might say that strategically it's not a great investment but he's saying [ __ ] it
00:20:25
i'm gonna spend 10 billion dollars a year no no he he said it for a quarter and then he
00:20:30
had to take it back and cancel it oh he said that they took it back yeah yeah but that's what he wanted to do
00:20:35
um and so to your point like it's very hard to really build things now yes but it can be done and
00:20:42
look i think one of i am what is happening in the world today geopolitically is tragic the war we are
00:20:48
experiencing ukraine is absolutely tragic but from all tragedies come some some good things there's always a silver
00:20:53
lining and one of the server lines here i think should be the acceleration of reshoring of all these products in teal
00:20:59
america to rebuild our industrial base because we actually can do it i can tell you i am starting my career basically as
00:21:05
a factory manager in california it can be done there are americans who want to make stuff between here mexico canada we
00:21:12
can make pharma we can make high-tech products yes the price might be a little higher but i tell you iteration could be
00:21:17
better and your value will be better if the product is better people will pay for it and resiliency and resilient
00:21:22
listen for 100 100 all right we uh are setting up a couple of microphones here antonio's been
00:21:28
gracious enough to join us for some q a the audience is filled with entrepreneurs capital allocators artists
00:21:34
and builders so we're going to put a couple microphones out there hopefully some lights on the microphones if i can
00:21:39
see them line up and remember the rule we don't need to know about your company just a tight concise question
00:21:46
anybody does any marketing or promotion we're all gonna groan let's practice a ground three two one
00:21:54
no garnish you could say you could say your name you could say your favorite so also wait before we start yeah if chris
00:22:00
is chris malloy okay uh everybody you guys may want to just know chris whenever you're in vegas uh chris
00:22:08
is the guy at carbone in las vegas which is the most you know best part of our restaurant reservation to get but chris
00:22:14
bought a bottle of wine for us that we can open now and drink while we do the ama yeah oh well bring up a bottle of
00:22:19
wine anyways that's chris malloy say hi to him get his number and text him if you're ever in las vegas
00:22:27
would bring the captain of carbone to our event oh keep the drink let's drink the wine
00:22:33
that's fantastic oh nice to meet you all right first question tell us your favorite bestie and then uh yeah we're
00:22:38
still doing favorite besties right right bestie and that's a quick tight question
00:22:41
go all right favorite bessie j cal uh point guard of the sentry to this team so hats off to you
00:22:48
um my question is first of all we've been here all week uh in last three days watching these cards fall from the sky
00:22:56
and we all know that you guys center around this poker table this beautiful game my question is
00:23:02
how is that game influence both your relationships and decision making in business and your personal lives
00:23:08
great question chamath start us off and you can go to the back and next person qf how is poker influence a friendship
00:23:15
our lives how is the poker game itself had an impact on our lives okay i think i really do believe this but i think
00:23:22
it's the most incredible game and training ground for business because in any given moment you are forced to
00:23:31
deal with the spectrum of good information to moderate information to bad information
00:23:37
good outcomes moderate outcomes bad outcomes you're taking risk you're learning information you're adjusting your style
00:23:45
and the most important thing is you're forced to anchor to your core values or not how
00:23:51
you behave at the table is how you behave in life you know you can take this yeah
00:23:57
yeah you can take these wins poorly you can take these wins well you can take the losses poorly you can take the loss
00:24:03
as well i i would encourage all of you to learn to play the game with your friends it's
00:24:08
it's a beautiful beautiful start a weekly game saks well the poker game at chamas south is how i got to be friends
00:24:14
with smoth right i mean i'm just saying this would you guys tell your wives why you stay up all night
00:24:19
playing poker because i've been there with you guys yeah it's pretty freaking degenerative yeah
00:24:23
we're all holding him exactly talking about baby it's training it's training for business no you just need this i'm
00:24:29
kidding you but i've been there i've been i've been there i've seen the drinking of the food too
00:24:33
for business we're not degenerates but that's actually well i was just saying i mean didn't you invest in yammer after
00:24:41
i started playing in your weekly poker game yeah and it was actually so degenerate what really
00:24:46
happened after that was i was in las vegas in 2011 i had just left facebook i moved to
00:24:52
vegas and i was on the phone with sax in between playing tournaments and he like let me in invest in yammer
00:25:01
literally like and you know you did me an incredible solid because i put money in
00:25:06
and you know what this is like nine months later he sells to microsoft and i returned a third of my first fund yum
00:25:13
yum and it really solidified my reputation so i mean i owe you a big one for that well i got
00:25:20
to say about this though so david sacks i've known david for 25 years he did yammer i want to put money in it he said
00:25:26
no because [Laughter] this is a true story it's true sorry he said no he said he said no because if
00:25:33
this fails you are my backup plan oh for a job yes i wanted i was so afraid of losing everyone's
00:25:43
money when i founded a company you know you know it took a little bit for me i wanted to have like one friend who's my
00:25:49
head and i didn't lose but you know that was the wrong way of thinking about it we should have should freeburg i mean
00:25:54
how is the game well before tomorrow are you leaving no i'm ready no no no no no wait come come come
00:25:59
come back for a sec okay he'll get glasses okay he's getting one i'll tell i'll tell you guys one thing chamoth is
00:26:05
one of the most generous people you will ever meet unbelievable he is and for all of his
00:26:11
for all of his bluster about his freaking mink coats and [ __ ] like chinchilla and chinchilla
00:26:18
he has brought together a group and he largely is the reason that i think the game grows and goes on and you saw some
00:26:24
of the amazing people that we've had on stage here some of our friends are here that we play in our game with that um
00:26:30
really that that network has been built and solidified because of chamath and his generosity and friendship that's
00:26:36
it's really um something i've i've learned to appreciate in my life and you know thank you thanks yeah yeah i mean
00:26:41
it's yeah it's a tremendous group and uh yeah amazing people like amazing people
00:26:46
and yeah the consistency of it has been amazing um from the generator chamath had this
00:26:53
like little tiny two million dollar house with like a one and a half car garage when he was at facebook and
00:26:58
we we would play in the garage that little tiny place you had remember um you know before you bought the two
00:27:04
houses next door and knocked them down and gentrified but uh true story um saks uh uh said hey you
00:27:14
know you're doing these conferences you should invest in the companies and this is when i put the fix in for him to win
00:27:19
techcrunch 50 at yammer with yammer he said i have to win and then he his wife told my wife he has to win so then i
00:27:25
basically got the whole jury to vote for him with the hammer he wins and he goes
00:27:28
hey schmuck all of my success is due to j cal you guys understand it was a good fix i put the fix in for
00:27:35
him but he said listen i want to thank you for this and you should start a fund instead of doing
00:27:40
all this work at the conference why don't you just invest in the companies i'll put 250k into your fund i'll be the
00:27:45
anchor i said that's incredible really and he said yeah and then i went to the poker table i told the story and then
00:27:49
dave goldberg rest in peace one of our great friends um and and certainly the the best amongst us thank you um he uh
00:27:57
he said i'll put money into it thank you and uh he put money in and then billy said i'll put money in and everybody
00:28:02
said they put money and free break said i'll take a pass um but you know we'll put that aside anyway
00:28:10
um thank you i was all locked up and other stuff yeah he's like i got a kenwalk barn i've got
00:28:24
and this is a true this is a true story uh bill lee's there he couldn't make it to here but he's one of our great
00:28:29
friends and and one of elon's best friends in the world and um he said of course i'm in um would you
00:28:35
mind if i if i tell our billionaire friend um the the co-founder of um ebay jeff skull
00:28:42
and uh he tells them uh jake how's doing the fun you should do it i meet jeff skull's money manager uh
00:28:49
and uh john and i i said hey here's what i'm doing i'm a first-time fund manager i
00:28:53
don't know what the [ __ ] i'm doing i'm a former journalist and he said how much
00:28:56
is the fun i sent 10 million he said i'll take half and i said i'm sorry and he said i'll take five
00:29:03
million and that was the biggest check i ever got and it was producibility and literally that first fund
00:29:09
uh was raised around the poker table in one night and that changed the trajectory of
00:29:14
my career and that really is the fellowship and it started with david and you hosting and i remember it's like
00:29:19
yesterday and i think maybe also a good moment to uh just maybe cheers to to goldie uh
00:29:25
dave goldberg um no longer with and tony shea who played in the game as well two
00:29:30
incredible man next question hey um my name is bobbin favorite bestie is tremont great too uh thank you
00:29:39
by the way antonio is also our people too all right listen we know chemical best
00:29:45
equipped with a question let's go yeah my main question is like when you guys actually decided to
00:29:50
manage capital for people like what really was the scariest step in taking that leap
00:29:55
and taking that risk i know a lot of you are gps solo gps so i mean sac you made a big leap
00:30:05
was the scariest step well i mean even as a founder like i mentioned before i was like so worried about losing
00:30:11
people's money i mean that was like i mean i don't know if like founders today even care that much that this seems but
00:30:18
it just seems like oh coming didn't work move on to the next one um i mean maybe
00:30:21
that'll change now that the environment's not gonna be as free-flowing but i was always like
00:30:25
really worried i was gonna lose people's money yeah and you know with something like sort of coming up i remember when i
00:30:30
started social capital i think i was playing i was either playing golf or i had dinner with chase coleman in new york
00:30:38
and chase says to me i'll tell you the one piece of advice julian gave me when i started thai girl but i said what was
00:30:43
that this is 2001 and he said this is a death sentence and i was like well what does that mean
00:30:49
and he said you're the only person that's going to live with this because you're responsible especially based on
00:30:54
who your lps are for folks that if you really think about who they are it's just going to create
00:30:59
this thing there and it's like you know and i was i was lucky in that moment because
00:31:03
we were we were able to get like the knight foundation and mayo clinic and these folks that are doing these good
00:31:08
works but then you're representing their capital it's heavy it's heavy because you make
00:31:14
this decision and if it's wrong you just feel literally like you're derelict and
00:31:19
you're taking money away from sick children or you know free speech i mean it's it was a that's
00:31:25
a brutally stressful thing to lose money on behalf of people by the way i'll recommend if any as a founder if you
00:31:32
raise money raise money from your friends too and it'll really change how you operate
00:31:36
yeah i mean i i raised the first fund for my friends and i tell you i took every single deal very seriously and i
00:31:42
did my diligence and i was very thoughtful about it how about you antonia oh man our first fund there are
00:31:47
two fears i had the first one was raised from i live in chicago from my friends in
00:31:52
chicago and i literally said to one of my partners at the time if this doesn't work i have to move
00:31:58
i'll have to really do chicago because in chicago you might get killed if you'd like something bad
00:32:03
like i thought you didn't mean the weather no no no i mean these guys are doing witness protection exactly these
00:32:08
guys lose your money people kind of like oh i'm sad about it chica would like break your legs they burn your house
00:32:11
down man that's a whole different whole different thing all right let's take another question oh sorry no keep going
00:32:16
now the second thing i mean honestly the worst thing for me the most scary thing
00:32:18
for me was just the people i had i had three or four guys to work with building companies before that and i knew if i
00:32:23
just felt if i disappointed them if we failed um i would have felt terrible yeah yeah
00:32:28
yeah it certainly makes you uh focus on the game it's like being staked in poker
00:32:31
you play better uh sir i have a question for the 17th most important person from paypal oh okay
00:32:38
i'm just kidding david obviously friedberg is my favorite bestie [Music] let's go marge
00:32:47
unbelievable the freedbird love all right freeburg soak it in uh you've been talking about uh how all
00:32:54
this increased money supply has been sending the asset prices up and now it's unwinding i don't think we've heard you
00:33:00
talked about crypto specifically bitcoin has obviously come down but it's still over three times uh where it was
00:33:05
pre-pandemic curious what you think will happen in that world as this unwinds you
00:33:10
you want me to address that sure or whatever it was for you most important yeah i mean so the the
00:33:15
thing the thing about the crypto market to understand is that it's like a liquidity sponge the more liquidity
00:33:22
there is out there the more people feel empowered to make speculative investments and crypto is like the most
00:33:29
speculative now that's not to say um you know it's not real i actually do believe in bitcoin i think uh there'll
00:33:37
be a number of other um sort of alt currencies that work but probably the vast majority will not and
00:33:43
there's been a tremendous amount of speculation and inflation there and so that space is in the process of
00:33:49
correcting you know i've never been able to say like what the right price levels
00:33:53
for any of this stuff are um let's say you believe in bitcoin long term let's say you believe it's going to be
00:33:59
the first non-fiat currency what price should that be today you know i it's it's there's no like discounted
00:34:07
cash flow analysis you can apply to it so it's always been very hard to know what the prices of these things should
00:34:12
be and so in practice the price is a function of how much liquidity is in the system and when you go through a period
00:34:18
of liquidity getting destroyed it's no surprise that cryptography goes with it yeah antonio have you touched i mean you
00:34:25
you were so into physical assets and building real things like spaceships and rocket ships
00:34:31
when you watch this crypto bubble you know grow and burst and grow and burst and now it's burst again
00:34:38
what's your take well first i want to tell you i bought my first crypto uh i mean i think in
00:34:42
2017 because david sacks and bill lee were pushing the ponzi scheme on me so they were like they were i was at a
00:34:48
birthday party i think you probably were there too and they were like they were they were hawking bitcoin so i bought
00:34:52
something nobody had heard of it at that point it was like i think it was like 800
00:34:56
bucks so here's my general view i actually think i think that bitcoin in particular
00:35:00
is a bet on rising political risk and on political freedom economic freedom is uh is closer to political freedom and
00:35:10
last time i looked ukrainians are the third largest holders of bitcoin and if i were staying in taiwan today i would
00:35:15
have 10 15 essence bitcoin so this this removes um the ability to control currency capital controls from
00:35:22
governments i think this is very important and it should survive price levels i don't know i do have a you know
00:35:27
the reason why a bitcoin as a hedge to political risk globally and that's how we think about it we have invested in
00:35:33
infrastructure assets in and around a blockchain with dave we have a couple assets because we believe that
00:35:39
blockchain itself is a platform shift in the technology of tracking assets this was a real thing and it's going to
00:35:44
happen it's going to change the way we do finance so we invest in infrastructure got it let's take another
00:35:49
question time mike over there oh i'm sorry we're going to take one from here we'll alternate
00:35:55
so um tide is right yeah hi uh carl muntra ceo of credo um i have to say i'm a science nerd freedberg but j cal it's
00:36:04
been awesome today um i and i want to say you guys like your courage and bravery to do what
00:36:11
you've done with the pod and watching this today like thank you [Applause] thank you
00:36:20
yeah um you've talked a lot about later stage i'm wondering if you could like tune in a little bit more on on pre-seed
00:36:26
and seed and kind of what you're seeing in terms of valuations and metrics that you've got to hit in in the earlier
00:36:34
stages it's very simple you know i invested in uber thumbtack and com for 15 million
00:36:41
dollars combined that was their combined valuation post money post money and uh those all three
00:36:48
companies had products in the market and then what we saw over the last five years is people wanting credit
00:36:55
for a white paper a prototype an mvp to the tune of 15 to 50 million dollars and we did sit out some of those and
00:37:02
said listen when the product is ready let's take a look at the product and talk to the first two or three customers
00:37:07
to david's point about zero to one customers is a really hard uh hurdle and um now it's back down to uh six to fifteen
00:37:14
million uh for a company that has a product uh in market and maybe fifty to 100 times yearly revenue for
00:37:22
evaluation so to the extent you can get to 200k in yearly revenue you can get you know a 10 to 20 million valuation so
00:37:31
i'd say halfway back to normal and perhaps a permanent you know livable reset because the
00:37:37
outcomes have been pretty fantastic so the early stage you go up the only thing you really need to raise money
00:37:43
is to build a world-class product and just get a couple of customers who are absolutely blown away by what you've
00:37:51
built that's all you need but everybody gets concerned with the theatrics and the performative stuff
00:37:57
and their network and nonsense and who you are where you came from none of it matters build a world-class product that
00:38:03
two or three people are obsessed with and you'll get the c check focus yeah i think right
00:38:11
if brad gerstner had uh sorry interrupt your applause j cal i know that's important to you
00:38:15
um i'll take one little like again so i think brad gerson made a really important point on this which is the new
00:38:22
normal is going to look like the old normal meaning the pre-covet normal we had the the abnormal period was this
00:38:30
two-year covay period where 10 trillion liquidity is pumped into the system things are going back to what they look
00:38:36
like before all that happened and maybe before the fed started with this zero interest rate policy so we're actually
00:38:42
getting back to normal understand that the the environment we're entering now is is the normality the abnormal period
00:38:50
was the inflation we saw in assets over the past couple of years that's the like
00:38:55
reset that everyone's gonna have to like wrap their heads around sex you're my boy finally yeah finally
00:39:02
one percent i i i think there may be some preference false falsification around this because people don't admit
00:39:08
they're conservative all the polling all the polling shows this so but anyway thank you sir
00:39:14
and your second favorite bestie is tucker uh for early stage sas investors which
00:39:20
most of you are in an increasingly digital world where are there are large sas solutions for nearly everything how
00:39:27
do you think about selecting companies and founders in the early stage that are coming to market with a small amount of
00:39:33
utility and how do you think about they compete with companies with already established customer distribution
00:39:39
yeah so i think you know one of the things i really like about sas which is your software as a service basically b2b
00:39:45
software it's business software okay that's sold as a subscription is that the world's never going to run
00:39:51
out of new ideas for business software business keeps changing so therefore the software that businesses need will keep
00:39:57
changing and there will always be an opportunity there for new companies new verticals new new niches they'll always
00:40:04
be you know new new ideas and so i'm never worried about running out in terms of
00:40:11
how we evaluate the actual idea you know we've actually been super transparent around the metrics that we need to see
00:40:18
it really does start with a company hitting the metrics hurdle that we need to see for for example
00:40:24
series a um you know it's a call it you're roughly more or less a million dollars
00:40:29
of arr you want to be growing 15 month over month certain that dollar retention certain capital efficiency we've all
00:40:36
we've published it you know on our website on our blog so um it's it starts with that and then once
00:40:43
we know that like our thresholds have been hit then we get into more qualitative or subjective factors like
00:40:49
you know what do we think about this founder in this market but one thing i like about it is just
00:40:55
it's uh it's very well defined like what we're looking for and so you know just go to our blog you'll see
00:41:02
we'll tell you exactly there's no outside of productivity tools though there's not a single company that can
00:41:07
stay in one category and become really big what does that mean there's not a single public company that
00:41:13
doesn't have now an entire strategy that says we sell it smb mid market and enterprise
00:41:20
and so the thing for sas businesses unless you're like a really powerful productivity tool like a slack or an
00:41:25
atlassian your valuation capped in the mid to high single digit billions as it currently
00:41:31
stands today that's just the law of the math in the public markets on how you're
00:41:35
rewarded though how do you grow out of it you have to embrace a strategy that actually
00:41:40
does more where you become a system of record so a good example is like a zen desk they hit
00:41:45
an upper bound you know there are many of these examples and so if you're building a sas business or you're
00:41:50
investing in this ass business the other thing to think about is in the absence of being a productivity
00:41:55
tool of which again there are few everything else has to find a way of being applicable
00:42:03
to larger bodies over time in order to maintain valuation we're going to try and move faster so we can get more
00:42:09
people another question here hi there guys uh favorite besties probably four-way tie but maybe chamoth edges out
00:42:15
just a bit there we go okay um not a tie so ty goes the champ quick question titus
00:42:21
right so um you know you guys done incredibly well so what what would you do if you're dropped
00:42:28
in the middle of say kansas take away the resource take away the network and take you back to age 25 what would you
00:42:35
do and why antonio take it i'm actually from michigan i got dropped in the middle there with no resources
00:42:41
and not a lot to do and i wasn't 25 i was in my early 20s um i would i would find a way to make it work man
00:42:49
you should get you should actually whatever scale you want to start at whatever job you have i would try and
00:42:54
start a little company there's always people in they listen to a place of grandma's michigan man you could cut
00:42:58
grass i love a computer company when i was 12 years old doing like networking for people in the old days i mean
00:43:02
there's always something you can do if you had a valuable skill build a skill start a company and just get started
00:43:08
start moving and make good decisions along the way one good decision compounds on top of the other and all
00:43:13
four of these guys what they have done in their careers has made very good decisions and they've kept moving when
00:43:18
they've had problems you start early yeah you got to start early and i started early they may i just want to
00:43:22
tell you this they may look like super successful guys now and they are but it wasn't easy and it wasn't linear they've
00:43:29
all had ups and downs they've all had problems and they all and they also do what they
00:43:33
what they do and i have great respect for all four of them i know them all well they keep making good decisions
00:43:38
they're highly resilient and they just keep going and i would tell you the same thing yeah
00:43:43
you got it the only thing i'd add to that is to keep is to keep learning i'm getting i'm getting some closure oh yeah
00:43:47
go [Applause] i haven't had any man yeah i just got here um but i would just say keep
00:43:56
learning as well like one of the biggest advantages i've had in my career is that
00:43:59
i try to always learn as new stuff as often as i can and whenever i find an area of interest i
00:44:04
pursue it in terms of deepening my understanding of it and that's always created opportunities for me that i
00:44:10
wouldn't have just stumbled across or walked my way into it's such a great opportunity to have you here and tony
00:44:15
when i asked you to do this you had never been on a podcast before have you ever done this kind of thing i've never
00:44:20
done this kind of thing and um no it's awesome thank you i'm only doing it because it's a four view and i am
00:44:24
usually very private but i'm enjoying an incredible voice you know he's like very light very npr
00:44:31
it's very public radio yeah it's like hey everybody you're listening to the politics and the culture i'm antonio
00:44:38
gracias people tell me i have a voice for radio and pornography yeah it works pretty well
00:44:45
go hey guys i'm samantha favorite bestie is freedberg i run the factory automation
00:44:51
team for a large semiconductor manufacturer in the united states really unimpressed with the innovation
00:44:59
in industrial automation and so really interested to hear your thoughts on where you see the next disruptions in
00:45:06
automation and also maybe a question for antonio where do you see the disruptor specifically and how we
00:45:13
get not only the technology but the economies of scale for these really capital intensive
00:45:18
businesses in the us this is your guy cancer yeah for sure and by the way you should talk about uh automation at i
00:45:24
don't know if you want to but sure tesla yeah yeah i mean we know a lot of automation one of my partners is like a
00:45:29
genius engineer in this area and you're particularly in the chip business you said right yeah
00:45:33
so you know tsmc basically took the many this idea of outsourcing manufacturing assets that intel did with tsmc the
00:45:38
beginning that created that business and moved most of our high technology and ships off and offshore into taiwan it's
00:45:44
like a terrible idea and we do i think we as i said earlier in the industrial policy in this country i
00:45:49
think we need industrial policy to bring chief manufacturing back it's very important and the problem you have in
00:45:55
automation ship manufacturer particular is you know when you think about where all the great engineers go today they're
00:45:59
good at automation they're not going there because they're competing tsmc so you have you have a
00:46:04
couple info fab still in the us but we have to have some i think actually it's going to require industrial policy to
00:46:08
force people like intel amd to want to bring stuff back into the us and to really get great talent to want to do it
00:46:15
do you think there's opportunities outside of greenfield models to kind of reinvigorate and unlock the capacity
00:46:22
that we have in some of our older manufacturing here in the us yes i do i i look i we at tesla took over the free
00:46:27
this freeland factory was a former gm toyota factory and you know we retooled it it was look we would have been we had
00:46:34
to do it because any money and it was free basically um but if you if you took that approach and
00:46:39
you got the you you've got really great entrepreneurs to focus on this problem through industrial policy they need
00:46:44
money to do it i think you'd get great innovation look nvidia is actually here in the us this is a reality this is a
00:46:49
great chip company uh and the fabs they use are spread all over the world but if
00:46:54
you gave nvidia a fab or two who knows what happens it was the right price yeah jensen's a great ceo
00:47:00
did you go to that side favorite bestie jason you keep uh the ship together you're the glue that keeps
00:47:06
it together uh my name is chris my friend and i started all in talk nine months ago uh the fan
00:47:12
page for that thank you cheers to you yeah it's uh it's really uh obviously i was at the outdoor mall near
00:47:19
my house and my dog attacked another dog and the guy was like it's okay i saw you
00:47:22
on i was like dude i'm not so that was because of you but thank you that was for his quinoa channel it
00:47:30
wasn't your channel that was so my question is in the 22 2022 predictions uh episode chamath you talk about uh all
00:47:38
in media idea and starting an all in media channel maybe and i wonder if you guys have talked
00:47:44
about that anymore your your goals for the future on that because i'm pretty sure everyone would agree here that if
00:47:51
you did start one it would do a whole a lot better than cnn plus so well that that may not be a very high
00:47:59
bar very low bar uh i think it is we actually we actually did get together the four of us we sat in freeburg's
00:48:05
office what a [ __ ] show people started yelling two people walked out the sacks sacks just started to do this
00:48:12
at the table yeah i'm definitely a good driver my dad lets me drive in the driveway it wasn't
00:48:18
a productive conversation it was completely unproductive like it was completely impressive that was our first
00:48:23
and only meeting but no but we did take one key step which is that freeberg said
00:48:29
i'm gonna get my team to draft the llc agreement for the four of us which we refused to sign but now no one signed it
00:48:36
but it's in our trust free birth but it's in our inbox so we're one step closer to starting it but joking aside i
00:48:42
still think that uh it'll become inevitable and i think the reason is the two people
00:48:48
and the robots non-humans that were uh uncomfortable with human interaction david's
00:48:55
david smirk um once once we do the the recap of this i think it'll be the i think these two are
00:49:04
probably the most shocked that no i'll tell you by the way my observation i used to go to ted i went to ted from
00:49:10
2008 until 2019 i stopped going to ted because i thought the content went to [ __ ] and it basically got overtaken with
00:49:16
like social justice talks and like used to start like tech and interesting ideas
00:49:20
about where the world's headed and like i listened to our speakers this week the
00:49:23
last two days and i'm like man like really fantastic content i'm like this could be the new ted so i got really
00:49:28
invigorated by that like i really thought i felt like that was really messy and i think and by the way i think i
00:49:37
think it's conversations people don't really seem to want to have right like and that and those are well make them
00:49:42
really important and let's just say you were not the earliest believer in this was gonna
00:49:47
get pulled off too i cannot tell you how many times i've considered quitting the
00:49:51
pod and not even showing up for this event and i give jason props publicly for doing a great job pulling this thing
00:49:57
off so [Applause] go go hey guys my name is sarah and i really love all of you you got me through a
00:50:06
very tough challenging time when i started listening to you i came here over a 16-hour flight from abu dhabi
00:50:13
um so thank you wow that's a long flight we love you we love you i have a comment and a question the
00:50:21
comment um and maybe david i have a lot of relatives in sweden and when the ukraine war started
00:50:30
this is very amiable innovative beautiful people haven't had a war over 150 years
00:50:38
and they were putting gas in their car and supplying cans of goods and got really really
00:50:45
nervous about what's happening and we're watching closely to see what would be the next step i think if the us did not
00:50:51
step in there so there was a lot of reality out there for the u.s to stay i don't know like the savior of the
00:51:00
world in a certain way or another finnish people felt the same way moldovans so this is a real big reality out in the
00:51:10
western european world not just eastern europe so um that's on my comment so thank you
00:51:17
for the question and this comes from my husband uh if you're sitting on excess liquidity
00:51:24
right now and want to invest for a long time i'm sorry [Applause] sax is raising a fund wait what was that
00:51:36
was that was that a transition from world war three to investment advice stock tips sock tips
00:51:43
yeah money in the market we want to save that is dynamic range right there yeah well done well done you want you've gone
00:51:49
from two poles you know i mean you had us know the ups and downs of my life so yes
00:51:55
it is like that why don't we just take the first part because i think okay it'd be good so so
00:52:00
on ukraine you know i thought it was important to have this debate today where we got both sides of the issue and
00:52:06
we got two people who are very passionate on both sides and i tend to agree more with glenn on it but
00:52:14
but that doesn't mean i don't want to help ukraine at all i just think we have to keep a close eye on preventing this
00:52:20
thing from escalating into world war iii because the russians have 6 000 nuclear
00:52:26
weapons and their military doctrine says they can use them if they feel that they're existentially
00:52:32
threatened and so you know if our objective here is to help the ukrainians expel the
00:52:40
russians from an invasion that's one thing but if our objective if we have mission creep into
00:52:47
destabilizing the russian regime into basically trying to take back crimea which they see as theirs
00:52:52
[Music] if our we're trying to weaken them to the point where they're no longer a
00:52:57
great power we're really playing with fire there so we have to be really careful about our
00:53:02
objectives there and make sure that we don't let this thing spiral out of control antonio what do you have
00:53:08
thoughts on ukraine and are we being too dovish or hawkish or doing it just right
00:53:15
so i think we are there there's a lot more going on here than me meets the eye and this question was about sweden
00:53:20
finland and here's what i would say because i want to focus on that that if uh our
00:53:25
our friends in particular north western europe um should actually be arming themselves
00:53:31
and if they arm themselves we won't have this problem that's the reality of it the reason
00:53:35
ukraine yes that's a reality obviously the time the time for sitting on the sidelines in central europe is over
00:53:43
if you care about your country you care about your children care about your families then you should arm yourselves
00:53:48
period full stop and americans will be very happy to sell you weapons no problem with or without nato i think
00:53:52
that's true the reason ukrainians are able to uh defend themselves is because they are they have actually been buying
00:53:58
weapons and they bought they built their own weapons with the turks that the the
00:54:01
the drones are being used to destroy the russian supply lines are not coming from
00:54:04
america coming from a joint venture with the turks this is the reality so should
00:54:08
we be drawn into a warrant central europe no i think could start well worth free should we help these folks defend
00:54:12
themselves yes i should and in your particular part of the world yeah for sure start buying some weapons one
00:54:17
question over here yeah tough to follow but my name is joanna favorite bestie i think friedberg i think you do a good
00:54:25
job of being heard and hearing others equally so i think that's an important skill i'm trying to work on it myself
00:54:30
[Applause] in terms of my question it's a little more qualitative but some of us were
00:54:39
having an interesting discussion about first impressions last night and i'm curious to think one in terms of your
00:54:44
own first impressions how has your the way that you introduce yourself to others changed as
00:54:50
you've grown and what have you learned about that and on the other end what are some of the most notable first
00:54:55
impressions others have made on you and why have those stood out to you that's an interesting question
00:55:05
well seeing as the only two of us have emotions maybe we can yeah we can chop it out sure
00:55:13
i'm gonna go to the bathroom you won't find any emotions there turn the mic off please the quinoa oh my
00:55:23
god well that baba ganoush goes right through you continue i think that when i was younger
00:55:34
i was more insecure so i had to wear what few labels i had on my sleeve and use them as a weapon before others
00:55:42
could use their labels on me i honestly felt that way you know and in silicon valley at the
00:55:47
time you know it really there is a very monocultural aspect of you know folks from a few schools you
00:55:54
know folks having worked at a few companies um and i had neither you know i worked i
00:56:00
went to waterloo which is in canada and i worked at aol so i didn't go to stanford and i didn't work at google
00:56:06
or yahoo and there was a there's a great lineage and of of where you know the really credentialed
00:56:13
credible folks came from and so you do what any insecure person does you kind of throw what few things you have out
00:56:20
there very quickly yeah you know trying to one-up the person in front of you and
00:56:25
that's calmed down a lot so that's probably the biggest thing it i think it's a i have a similar observation i
00:56:32
when i was taking that r train into manhattan i used to say to myself jason calacanis editor-in-chief jason
00:56:38
calacanis millionaire and i was like literally had a 16-page photocopy magazine called siliconaire reporter and
00:56:45
i was trying to convince myself that someday i would be somebody and i think that narrative was important for me and
00:56:52
people when i would give them the 16-page photocopy i'd say here's my magazine they'd say there's a photocopy
00:56:56
i'd say no it's a magazine it's got a picture on the cover because for me that was that why it was a magazine and it
00:57:02
eventually became a very large magazine in fact of 300 pages and today thank you
00:57:09
so i think there is something about manifesting stuff and just you know believing that you're going to get there
00:57:14
but today i define myself by the things i love to do so when people do ask me now hey what do you do i say
00:57:21
i'm a writer and i have a podcast and i angel invest and i don't say it's the number one podcast or i'm one of the
00:57:27
top angel investors all the time i just i just think about what i don't say that and i don't say
00:57:33
you know like it's the you know the book is in 11 languages or whatever i got a million dollar advance
00:57:39
i just there's no ego about it i just say writer podcaster angel okay how did it go in there okay david
00:57:52
you're okay what sort of advance are you getting a million dollars he said a million
00:57:56
dollar advance i mean the book's in 12 languages now thank you i'll find out if you have one i'll sign it next question
00:58:03
sometimes sometimes i think jason's just pimping out all of us to fuel his media
00:58:07
career yeah you big sometimes hey david all honesty how is the deal flow gone since you got this podcast i
00:58:17
think it's down fifty percent that was the intent that was the attention more deal coming this way
00:58:25
that's since you went on tucker go hi today the crypto world is focused on decentralization speculation and stores
00:58:33
of value who here is excited about micropayments and whoever is most excited which industries do you think
00:58:39
will be most impacted by the newfound ability to send payments as little as one hundredth of a penny
00:58:46
great oh favorite besties uh zach you wanna take it yeah good sex um so you know this question of
00:58:52
micropayments has come up all the way since you know back to when i was working on paypal and one of the
00:58:57
problems with micropayments is as the name suggests the amounts are very very small
00:59:01
so you have to do a lot of them to create enough volume for them to be meaningful and so there's always sort of
00:59:07
this market size problem now for crypto there may be more of an opportunity there because
00:59:14
um the way that the old credit card rails network works is there's like a 25 charge per transaction and so like at
00:59:21
paypal it just didn't make sense to facilitate micropayments because the cost of that transaction always exceeded
00:59:28
the fee that we could get so you're right that or i think what you're suggesting with
00:59:34
your question is that there is sort of a crypto opportunity to do this in a different
00:59:39
way because you can basically do a costless instantaneous transfer using a blockchain based currency so
00:59:46
i'm sure someone's going to do something interesting with that and then the question is just
00:59:50
how like what does that aggregate into is it is it going to be big enough to be by the way there's a there's an interim
00:59:55
step which is also pretty obvious at least to me which is this idea that you know for example like if stripe actually
01:00:02
took the time to embrace one of these stable coins there's no reason why stripe needs to
01:00:07
actually run on interchange as well because like you can just basically swap that dollar in a ledger
01:00:12
into usdc let's just pick that as an example not tether not to tilt you um run it on those rails for free and then
01:00:19
basically transfer it back and it's it's not it's not obvious why people don't you need the gas cost to come down so
01:00:25
you know like you're running a transaction on ethereum or certainly bitcoin is very expensive right now but
01:00:30
other chains yeah yeah you need like a chain like a salon or something like something that's like super cheap
01:00:36
and the the cognitive load of the transaction just the person deciding do they want to pay a tenth of a penny a
01:00:44
penny is sometimes greater than the actual value of the money which then creates
01:00:49
um almost like friction to them wanting to read the article let's take another question
01:00:55
hi my name is kate and my favorite bestie right now is freedberg who often plays devil's advocate and so forces the
01:01:02
stuff my lord how many people did you pay off go ahead so that we all admired your successes
01:01:15
but we've also been hearing from marr for instance that we need to be comfortable with failure and we need to
01:01:20
become resilient so when you look back on your careers thus far what have been the toughest moments the
01:01:26
moments when you've made a mistake that have taught you a lot i mean i had two huge ones and antonio
01:01:33
just have some too yeah mistakes my mistakes that you learn the most from man my biggest mistakes in life have been
01:01:42
about people and i have uh over the years um made errors in in judging people and
01:01:50
how honest they were and how good they were and as i look back on that it's because i have a weakness for ideas that
01:01:57
are great and sometimes those come with great people and sometimes they don't the reality is there are some bad people
01:02:02
out there who are acting really great and doing interesting things and we have we've suffered from that i mean i know
01:02:08
david and i were to deal together suffer from that and it happens so i i would be i've learned a lot about
01:02:14
that i've gone deep into neuroscience i actually have a stat we have a woman who's got a phd in the neuroscience of
01:02:20
emotion caltech now on staff that helps us uh learn as you said always learning about how to assess people and how to
01:02:28
stress their emotional states that's the most important thing i think we've updated in our process and in my
01:02:33
own thinking so you loved the idea so much that you ignored other data you ignored
01:02:39
the other data that this person was not honorable truthful no i mean so there are times when uh
01:02:46
there are two kinds of of these errors here one type of error is we just didn't see it because the person
01:02:52
was so good at being bad they are you know one of these neuroscientists taught us is that about five percent the human
01:02:56
population has a brain anomaly they make them actual psychopaths defined as the ambiguous fire properly when they do
01:03:02
something bad guilt fear etc and in our particular industry it's probably like 10
01:03:06
so we raised our base rate forecast to 10 percent and it's gotten better but there's something so good at it you just
01:03:11
can't see it i mean theranose elizabeth holmes okay like lots of smart people pointing that company we didn't but it
01:03:17
was it wasn't obvious to them obviously then there are then there are moments earlier on when we had yellow flags we
01:03:22
overrode because we were so emotionally committed to the idea that we had a business we did was in the dental space
01:03:27
was it was medicaid dental cleanse for kids that were black and hispanic and i'm you know i'm from that demographic
01:03:32
and i wanted to make that great in the realities we overrode yellow lights because we wanted to make it
01:03:37
great and we failed jamatha you were going to add some of your finances i had two huge fielders
01:03:42
but they were they were more personal moments of learning for me one was you know we were in the midst of
01:03:47
building a phone and it didn't come to pass and if i really think about what i thought the problem was this was when i
01:03:52
was at facebook what the problem then versus now then you know i would have said oh zuck and i
01:03:58
had a huge kind of you know thing and blah blah blah now what i would have said is
01:04:03
you know i didn't really understand my own limitations and what i was really asking of him in the board in that
01:04:07
moment and then the second is there were all these moments that were people decisions
01:04:14
um at social capital that ultimately manifested in sub-quality financial and investment decisions
01:04:23
and had i had it to do over again i would not have ignored some of the red flags
01:04:29
because i was so desirous to be in the game to you know be in it that uh i probably you know looked the other way
01:04:37
a little bit on folks that you know i'll just give you the the practical example
01:04:42
i remember in a 300 million dollar fund i put 25 or 30 million dollars into bitcoin at
01:04:48
50 bucks a coin and when the thing went to like 150 or something just the pressure
01:04:56
to distribute was so high and i had conviction i had all of these things i had all the voting control i
01:05:03
had everything to just say no and i didn't have the courage to understand my role
01:05:10
as a leader versus something you know my job as a investment partner um and so you learn you know
01:05:19
you learn what you're good at you learn where your strengths are and you try to just get better try to
01:05:25
fix those weaknesses i mean at the end of the day what we're both saying is the same thing which is ultimately it has
01:05:29
nothing to do with anybody else it still comes back to you and what your skill set is in your toolbox and whether
01:05:34
you're upgrading your toolbox every day freebird sax any mistakes that you're able to access through your cpus
01:05:43
in your long-term storage well i think as you get older you learn how to pick your battles better and you
01:05:49
just have to decide like what are the occasions that are really worth fighting for which aren't you know and sometimes
01:05:54
you just let it go and others you have to fight so and just knowing when you should choose which path i think is
01:06:00
really important by the way the guy you really want behind you in a battle is this guy
01:06:05
so phenomenal uh investor back when i was on the founders side of the table so good brawler yeah for sure that's why i
01:06:13
got him a samurai sword for his birthday he did yes the collection of samurai swords you saw
01:06:20
my apartment started with david sacks and samurai sword ah yeah that's very nice thank you david very sharp too
01:06:26
was your kids trying to play with it or something it was not a toy yes freedberg anything in that long-term
01:06:31
storage tape drives of a i've made a lot of mistakes um it's really hard i i'm very hard on
01:06:39
myself when i was young i always said there's no limit and i always believed that and when i hit walls
01:06:52
in my life it was very um very difficult because it totally countered what i what i felt was
01:07:00
possible i always thought everything was going to be a success uh there's no way
01:07:04
i'm going to let anything [ __ ] fail there's no way i'm going to let anything not work
01:07:08
my voice is cracking not because i'm crying because i'm losing my voice so um we know that's all we need if you cry
01:07:14
now there everybody's gonna be pleased now everybody's got free perks it's all for the vote it's all for the
01:07:20
vote he actually does have emotions see but i would say um he's smart and kind yeah
01:07:27
and a vegan yeah he's perfect the biggest mistake i made he's my dream boyfriend
01:07:37
maybe coming on the stage with the biggest mistake i've made joy in the pot oh man but i think
01:07:43
antonio's point is right uh you know um you just have to be willing to to learn and um and evolve it's uh
01:07:49
you know i i now know that my life isn't about everything i do has to work 100 of
01:07:53
the time and being so hard on myself caused a lot of like emotional challenges for me over
01:07:59
time but getting um getting to this point where i can now be much more calculated
01:08:04
and just move forward quickly and learn from it um has been a big evolution for me um it's just a general statement but
01:08:09
yeah yeah i and i would oh sorry well no it's okay i just uh i would i was thinking about it while
01:08:14
these guys were being so candid and i was immediately gonna punt and go to the next question but i thought that would
01:08:19
be unfair um you know i think two things one i think a lot of my decision making early on was
01:08:25
out of fear uh fear of losing whatever i had gained up until that point so although i was a risk taker and i was
01:08:32
being bold in one way i was also throttling myself because i was just so scared that i would lose whatever gains
01:08:37
i had and it it made me an imperfect manager of people an imperfect person uh maybe on edge a little too much and
01:08:45
maybe not picking my battles to david's point ever i saw everything as a battle because those wins were so important to
01:08:51
me because they were so hard fought and then i think later in my life i realized i never actually thought about
01:08:57
what i enjoyed i just thought about winning um to an extent that was not healthy and
01:09:03
then after dave goldberg died and tony shea died i really took a self-assessment of what i enjoyed doing
01:09:09
and i mentioned this yesterday you know hanging out with these gentlemen and and
01:09:13
to antonio's way of phrasing it which is just beautiful the fellowship i thought
01:09:17
that's the joy you know my family my kids my wife and this fellowship with my friends that i wanted to invest in and i
01:09:24
made a deliberate effort to be a better friend a better parent a better husband uh and because of all the gains i got
01:09:31
from that and the joy that i got from it and i just thought a little bit god i do
01:09:35
like those conversations i do like writing the book i do like throwing the events i'm just gonna do things i enjoy
01:09:40
which took me 30 years of my career to actually assess what is it that i like and maybe i should enjoy the journey a
01:09:46
little bit more so i think it's a great question i appreciate it let's take one more
01:09:50
thank you enjoy the journey hi besties my name is arya i was the third or fourth employee at doordash um
01:09:59
and my question is regarding oh sorry my favorite bestie yeah that was a joke by
01:10:04
the way my favorite besties chamath and sax although it's honestly sophie's choice um
01:10:09
my questions regarding the positive impact that silicon valley could have on the political discourse and politics
01:10:17
which i know you know there's typically an aversion to in tech you know you all have done a fantastic
01:10:23
job outlining what those problems are as well as your guests what i'm wondering is what a viable path
01:10:28
forward looks like you know chamath you mentioned that people in dc pay close attention to the podcast sax has
01:10:33
recently endorsed michael schallenberger which i really hope can save our home state and i'm wondering is is the
01:10:39
solution something akin to a third party like what andrew yang is trying to do or some
01:10:44
new i don't know silicon valley techno party or you know is there is you know what does that look like i'm curious
01:10:51
well i don't think it's set up to actually have a third party structurally in america so what you have to do
01:10:56
practically speaking is field more centrist normal people on both sides whether they're republicans or democrats
01:11:02
that's a practical thing that we can all do and then we can all show up and vote
01:11:05
for those people so that the the majority voice is much clearer than it is today because right now the fringes a
01:11:12
little bit get to hijack the process um and so we take things that are that should be common sense and we pervert
01:11:18
them in a way that just makes no progress possible um i really do think that we have that
01:11:25
impact i'm not sure how much can be quan of that can be quantified but when i spend time in dc i
01:11:33
think it's true what i was told and what i've heard from people it's basically required listening or viewing
01:11:39
it helps shapes people's opinions doesn't mean they follow it but i think it helps people think about things in a
01:11:44
more normal way i think what happened today is like a perfect example like the way that glenn
01:11:48
greenwald and antonio garcia martinez debate like that's probably for some of you was really unsettling maybe raise
01:11:55
your hand if you were just like you felt awkward honestly just be honest with you okay
01:12:00
well you shouldn't because that's normal my point is it helps you make it seem more normal because those guys were not
01:12:05
saying to each other that you're worthless and you're not they were just debating by the way we went out for a
01:12:10
beer after that yeah this is my point the three of us i was like okay we need to like go out and get a drink and cool
01:12:15
down so i'm not i'm not chastising you for feeling that way i'm just saying this is what the culture does to folks
01:12:21
it makes you even afraid to hear people debate things and still have respect for
01:12:26
each other the way that he and palmer kind of dealt with that was that's incredible the courage that palmer had
01:12:32
to say what he did and then for him to be the first guy to walk out and then to own that that's a i think those are
01:12:38
really important moments and you have [Applause] you you have 700 more people capable of being that way because of
01:12:49
what just happened so yeah i think it's a slow march but i think we're we're doing we're right we're riding a
01:12:55
small dent in a small way 20 years ago every political show on tv was a debate format
01:13:01
like going all the way back to william buckley versus gore vidal or pat buchanan versus michael kinsley on
01:13:08
crossfire i mean they were all debates now like none of them are debates it's all discs their own little echo chambers
01:13:14
i think it's one of the reasons why this pod is successful is we actually can have debates and there is a divergence
01:13:20
of views what do you think antonio's or is there some have you ever listened to this pod
01:13:26
um i i was on one once dancing in the background oh that's right yes thank you the dancing bear yeah he did dance
01:13:31
behind me i recorded an episode from his house yeah um well i mean you look at politics
01:13:36
any interest there any any any um you know behind the scenes work you've done and how do you think about it just
01:13:43
as we get into as gen xers boomers are going away i mean we're going to kind of inherit this whether we like it or not
01:13:50
yes i would i would say a couple things first whenever you have times you look historically i think it's important to
01:13:55
contextualize this when you have moments of large technological change you always
01:14:00
have political disruption because the means of communication have changed this the gutenberg press the
01:14:05
tall ship and you just go back and look it always leads that light disruption and often to war
01:14:11
and so the question of are those of us who are technologists at the top of the system who have a responsibility to
01:14:15
steward this technology responsibly we absolutely do i believe we do and i think that has been forgotten
01:14:22
that's number one number two i have been involved in campaigns um and it's interesting right now what i'm
01:14:28
doing is supporting any centrist candidate that i think is good on either side of the aisle i'm a registered
01:14:32
democrat i support democrats for most of my life but the reality is now all i care about is sensible people that i
01:14:38
think are really good and i'm engaging in micro targeting efforts across the spectrum in in primary races and i would
01:14:45
encourage all of you and anyone up here who cares about the american book system
01:14:49
to engage in the primaries because the primaries are what determines the quality of the candidates that actually
01:14:54
are up for election and they're actually decided by very few people yeah like how
01:14:59
many of us actually voted in the primary like very few of you very few of you okay so rather than us just complain
01:15:07
about the divisiveness of american politics next time please go vote in a primary and go vote for the center's
01:15:13
candidate by the way did i hear a lot of support from michael shellenberger out there
01:15:24
let's have him on the pod maybe yeah hi favorite bass is chamath i i heard you speak with vinod khosla at hack the
01:15:31
north at the university of waterloo uh so my question is ammar talked about these like startup journey systems like
01:15:38
stanford or paypal do you see like over the pandemic do you see any like remote or
01:15:43
distributed systems that have like appeared or do you see any like building that are not just
01:15:50
centered in one geographical location i'm not a huge believer in this whole decentralized work movement i don't
01:15:56
think any high quality work can get done um on on on difficult problems so i think
01:16:04
that there are types of products and types of problems that can be solved in a remote way certain forms of software
01:16:12
for certain kinds of products but for example let's just say you're trying to engineer you know
01:16:19
a co a a pharma drug i don't believe that unless you're sitting there collaborating talking
01:16:26
debating you can do that necessarily over a zoom if you're trying to build something physical you know we have a
01:16:32
business that 3d prints rockets those guys can't do that by just you know zooming around and having a couple calls
01:16:38
that doesn't happen so i i think it's too premature to kind of say working together has no value i also
01:16:47
think there's a huge cultural divide that will get created in america between these companies that come together
01:16:54
and the companies that don't and i think that the ones that come together have a
01:16:57
chance of having more empathy in the end because there are moments where you can
01:17:02
actually get to know the people you're working with every day and i think that that gives you margin for error because
01:17:07
everybody sometimes is a little you know dealing with their own things in their lives
01:17:11
sometimes can be a little rude and we all have tolerances those tolerances are higher when you spend
01:17:16
time with people and they're much much lower when you're just in a zoom so i'm you know
01:17:22
i'd love to believe that everybody's gonna be airbnb in a castle and a tent in a [ __ ] treehouse but i'm just not
01:17:29
sure that that's realistic to really solve the big problems that america has you believe in the work from home
01:17:35
antonio you have a strong feeling one way or the other um i i'm more on chamos camp than not
01:17:40
but i will say we have some great companies are fully remote um we have a coalition example in cyber security it's
01:17:46
fully remote run by a wonderful ceos under the age of 35 and he's found a way to make it work and
01:17:51
i've learned a lot from him and so i'm trying to be very open algorithm about this and i think there are people to
01:17:56
make it work i can't make it work i want my people in the office we invest in pharma um we invest in biotech and we
01:18:03
have some biotech companies that have made it work uh remotely and some that insist on bringing back people back if
01:18:08
you're in a lab obviously you have to be back but it i think there'll be a mixed
01:18:11
environment and i also think there's an interesting retooling going on in productivity i think the productivity
01:18:15
numbers in american that we're seeing today are wrong because they're not capturing what's happening underneath
01:18:19
the technology because these remote environments so i don't know yet i think it's gonna depend on the ceo and how
01:18:24
good people are and the type of industry you're in yeah i'm keeping an open mind towards it
01:18:30
i know that for investing it was so much more efficient you know people could do 20-minute zooms
01:18:35
instead of two-hour meetings but i mean think of the problem that that created look at the overhang when you could
01:18:39
raise tens of billions of dollars over zoom that turned out to not be a good thing well and but also if you're a
01:18:46
capital allocator being able to meet with three times as many people you could find more companies this is my
01:18:50
point yeah so i had a friend of mine who raised billions of dollars over the last
01:18:55
couple year cycle and he said i was able to raise 50 million dollar checks in 30
01:18:59
minute meetings now spending five hours for a 10 million dollar check and my reaction to him in the back of my
01:19:06
mind was that's probably how it should be well part of that that makes the entire
01:19:10
system a little bit healthier yeah i mean we we raised one point similar funder in covet and it was all done
01:19:15
doing zoom reason new fun now and i'm flying around the world taking meetings but part of that is because people are
01:19:19
coming back the office and the liquidity cycle's gotten is reversed on us now right so the denominator has gotten it's
01:19:24
got a heart attack capital but for sure i think i agree with chamathia like being able to allocate 10 billion
01:19:28
dollars in a venture fund in two years over zoom and and think that's a on just the
01:19:33
metrics and not see people i think that's a bad idea yeah i'm talking about two hundred fifty k five hundred checks
01:19:39
okay might be okay take another question here my name is kenneth brown the third
01:19:42
and my favorite bestie is j-cal the charisma is legendary um he's my favorite best you too by the way
01:19:48
don't be offended and then my question is what advice would you give to non-technical people
01:19:55
trying to fit into the tech oriented startup venture world i'm an econ major but this just seems
01:20:01
exciting like how do i become a part of it and tony have thoughts and i i think that the um the best way
01:20:09
to do this is to find a company you think is great and get a job that's a reality i mean i would just i
01:20:15
would associate myself with the business that i really respect people respecting
01:20:18
if the job is in the mail room or the bob is the job as a janitor whatever just figure it out because what happens
01:20:23
with high growth companies is they need good people and you'll be surprised how much being the first person in and the
01:20:28
last person to leave if there's an office and doing the work that he will ask you to do with a smile and a great
01:20:33
attitude like those people they move up fast so i would just find a way in man wherever it is however it is make it
01:20:39
happen and start moving up by the way you're you're not you're not non-technical you're not yet technical
01:20:47
and i think that's the opportunity that sits in front of everyone that you can become technical i had a my
01:20:54
fam a cousin who was a music major ucla worked in music and then he came back from covid and he
01:21:01
started learning how to program online taught himself spent six months in his parents basement teaching himself how to
01:21:07
retool his life and got some contract jobs on reddit and boards and other stuff and he got this amazing full-time
01:21:14
job offer a few weeks ago and it was really amazing that i got to watch him transform himself and his life over the
01:21:19
last year and a half just by taking that on himself and he became technical it wasn't that he had a non-technical
01:21:24
degree it said he just wasn't yet technical and i think everyone has that opportunity i'll tell you i'll tell you
01:21:29
a great quick story he's a minority guy grew up in houston really wanted to work at tesla couldn't
01:21:36
get a job couldn't get a job couldn't get a job finally got a job on the line he was making 16 20 bucks an hour
01:21:44
worked there did well transferred worked there did well transferred ends up in the supply chain group ends up working
01:21:50
in battery supply chain ends up basically being two layers between him and elon gets into an mba goes there for a few
01:22:00
years uh works on the side uh and he ended up raising a bunch of money to start a battery business recently and
01:22:08
this is an example of what he just said which is you know there are these jobs available
01:22:13
and then it's just you know is your hood spa and your hustle and he's an example
01:22:18
but it's a very motivating example to me because it just shows it's so possible you know and there are phenomenal
01:22:23
organizations that identify talent and will move you up really quickly and knowledge is literally free and
01:22:28
experience is up to you yeah the the the overriding i think advice you're getting here is that
01:22:35
skills are acquirable and my lord getting to 50 60 proficiency on a skill just given what's on youtube or
01:22:43
mit open courseware or any number of websites you can do it in a matter of weeks
01:22:48
and now of course going from 60 70 70 to 80. that might take months and then eventually years
01:22:54
um but startups are looking for generalists they're looking for people who can say i i need somebody who's
01:22:59
going to do the accounting and figure out how to do an email merge and build a mailing list and then i need somebody to
01:23:04
help with recruiting if you can just become 30 40 50 as you know good at each of those things at
01:23:10
a startup you know before people get specialized eventually you'll have 10 people doing
01:23:15
recruiting but in the beginning it's one-third of somebody's job so i love startups for the sign of a great culture
01:23:21
of a company is how little the obvious labels matter once you're inside of it and the best companies like a tesla can
01:23:31
become a trillion dollar market cap because they find the kid working on the line and then four years later is
01:23:37
running the battery supply chain how does that happen it happens because you're looking at the
01:23:43
quality of the individual and their potential where they went to school doesn't matter their gender doesn't
01:23:48
matter their ethnicity doesn't matter none of it matters because the people don't see it
01:23:53
they see work ethic they see results yeah they see episodes they see integrity so that's another litmus test for you is
01:24:01
like in the companies even if you're a ceo and if you're building if every other day you're reminding everybody
01:24:06
else of like where people need to have gone to school and where they should have been
01:24:10
that's a road to nowhere let's give antonio a big round of applause very nice [Applause]
01:24:27
thank you next question hey guys over here all right we're gonna just take 14 to 20
01:24:42
more questions go sunny lambo here um chamoth's my favorite bestie yeah there you go huh
01:24:50
because of him a little dry spell huh because of him i shop at laura piana only so thank you
01:24:57
so just got a question um for freedberg i know that you wanted to talk about this yesterday about this sort of uh
01:25:03
consumer credit crisis on the horizon that you see as potentially like the next shoe to drop so um i think you
01:25:09
wanted to mention something yesterday about it but because of time and stuff i mean i i don't have anything more to
01:25:15
add than what i said on the pod i'm not like i don't think this is like a high certainty i i'm just concerned
01:25:20
there's a lot of loans out there a lot of buy now pay later a lot of stuff that has floating rates attached to it
01:25:26
if we're going to have a recession we're going to see job loss you're going to see these
01:25:30
and by the way these auto loan portfolios have like crazy outperformed over the last few years
01:25:35
and now that these and a lot of those auto loans are floating rate those asset values are inflated people
01:25:40
are losing jobs you could see a bunch of these things start to create a bit of a
01:25:44
cascading effect over the next couple of quarters depending on how this all goes
01:25:48
um so i i'm not i'm not going to put my foot down on the ground and say oh my god consumer credit bubble we're totally
01:25:53
[ __ ] it's going to lead to the great next great recession um but i do think it's going to be
01:25:58
pretty kind of surprising by now pay later i saw stat i don't know if you guys saw this this week on how a lot of
01:26:04
the people that are going on buy now pay later sites are actually maxed out on their credit cards and so they're
01:26:09
actually fully credited out and then all the smart algorithms are like oh yeah you're a good credit risk like
01:26:14
here's here's eighteen hundred dollars somebody's like whatever lightning round five questions
01:26:18
and we're done one bestie will answer each question go cool uh dave freeburger my favorite bestie uh
01:26:25
what problem do you most want to solve right now oh binary lifters actually uh edible
01:26:31
quinoa actually i've been working on the so look i i've spoken about this publicly i
01:26:40
think it's a big problem i was going to talk about it in the talk that we scrapped but i'll do it another time
01:26:44
um which is really the opportunity for biomanufacturing as a way to replace a lot of traditional food systems
01:26:51
including olive ag all of animal agriculture and a lot of the systems that we use to
01:26:56
basically make our food it's a it's a big infrastructure play you know a couple square miles you know
01:27:03
using elon's analogy you could basically recreate all the food on earth and you could distribute those systems
01:27:08
um and and so i i think that it can be extremely carbon negative it sucks carbon out of the atmosphere
01:27:15
um it will create incredible jobs it's an incredible infrastructure opportunity it would return billions of acres of
01:27:20
land back to kind of you know whatever form natural form we want them to be so that's an area that i'm spending a lot
01:27:26
of time in and that i'm particularly excited about awesome thank you okay number two hi there i'm katie croft nice
01:27:33
to meet you all imagine a parallel timeline where i say you're all my favorite uh because it's all true um so
01:27:38
i'm curious kind of an extension of the media question have you given much thought to forming a
01:27:43
consortium or community um with the all-in podcast and kind of what further applications of that because if
01:27:50
you think about the forced multiplicity of like any number of these minds in the
01:27:54
same room working towards the problems we've talked about from education to entering energy
01:28:00
it could probably be pretty considerable the impact there because we have such respect for what you guys do and how
01:28:04
you're doing it and the discourse you're having that you know we're clearly all diehards here so i'm just curious if you
01:28:10
thought about it i'm kind of trying to inception you here you want to take that yeah i think so i mean uh this is a [ __ ]
01:28:14
ton of work um but i think it is and we all have day jobs um you know step one was to try to just
01:28:21
see and i told the best things let's just see if we can each make um getting to the pod each week a priority
01:28:29
and a habit and and that took the first year or so so now it is a habit we all value doing
01:28:34
this it has had tremendous impact on our lives personally and professionally it's been very inspiring for each of us
01:28:40
so we had to lock into that first doing this you know uh was a ton of work and we'll see if it's sustainable and we
01:28:47
have some other ideas we wanted to do a college tour was the other thing we were
01:28:50
considering which would be like three thousand seats or four thousand seats and just an episode of the pod in q a so
01:28:55
i think that could be the next card to fall um and then maybe hiring tim urban and
01:29:00
uh nate silver and then having to build a media company to take on cnn um but yeah we haven't really given him much
01:29:05
thought but you never know they were here totally randomly all right they were here totally around
01:29:09
we're not recruiting or anything but um you know anything's possible hi besties again i'm rejoice i run a
01:29:15
talent marketplace for early entry workers we use gamification to accelerate their plans remember
01:29:22
i just the question is about the great resignation which we believe is a half-told narrative so how can small
01:29:28
businesses which are most sole proprietors democratize their own labor supply and demand
01:29:35
wow um i think that's a very difficult problem to solve i think again if as a supporter of capitalism
01:29:47
i think one of the biggest things that we don't get right is how money gets to the right problems i've
01:29:55
said this roughly before but like money is really just a voting way of deciding what you think is important
01:30:02
in the world and that's why the accumulation of money as just a practical matter forget moral or
01:30:08
physical philosophical is so important because you can vote what you want the thing is that aggregation happens
01:30:16
easily distribution is terribly broken and so the ability for folks to solve practical problems is very hard because
01:30:23
the roi isn't obvious and getting money from capital pools like us to individuals and sole proprietors is a
01:30:29
basic i think it is a very broken problem a because the systems don't exist b because the laws don't allow it
01:30:37
and until that gets solved i'm not exactly sure how a business who can actually like build for the future well
01:30:44
or solve their supply forecast or demand forecast can actually get the capital you need because the lubricant that
01:30:50
allows you to solve that problem is money has always been will always be but getting it to those people
01:30:57
is legally hard and it's organizationally impractical um i don't know if you saw the last spot i
01:31:04
mentioned this thing we tried this thing called capital as a service it doesn't get to the sole proprietor level but it
01:31:08
gets to like small five to ten percent companies we would send fifty hundred thousand
01:31:13
dollar checks here's how hard it is the cost of getting a 50 000 check we did this uh
01:31:19
fishery in indonesia it cost us 125 000 to give them 50 000. we still did it because i just wanted to
01:31:27
prove the point they ended up tripling our money so we barely kind of like broke even um but it just goes to show
01:31:33
you how really complication in the system okay fourth question and then one more after that
01:31:38
hey i'm prem uh as a waterloo poker player favorite besties to moth i'm very into next-gen manufacturing but as a
01:31:46
pre-seed investor my concern is follow-on financing how do we get more investors interested
01:31:53
in investing in the physical world because at least in canada it seems like most investors only want to invest in
01:31:58
software no i think i think this is what i'm saying i think there's a very broken
01:32:02
part of the capitalism right now which is that technology investors by and large and i
01:32:07
don't mean to disparage anyone here are not well rooted in the principles of math and finance
01:32:14
and i think that that's a real problem because in a moment like this that is where you can actually make safe
01:32:20
investments of capital you can structure the money in so that you are capital protected you have assets to back these
01:32:26
things and the reason why folks don't do it is they don't understand how to put together a model to demonstrate it and
01:32:33
then the person that is then receiving that information is unfortunately not as well instructed
01:32:38
as they should be to understand how to make a decision from that that's what we have today so it's a it's a little bit
01:32:43
of a mis-education problem and it's going to affect the non-sexy areas rockets will always get money
01:32:51
but like 3d manufacturing excel at scale may not because of this exact issue because people don't know what roik
01:32:57
means sir you have the final question favorite bestie is uh friedberg and i hate to end on a recession question
01:33:05
but never asking that question again why do you guys why do let me ask why do you guys think it upsets you so much
01:33:10
like well because you're the biggest pain in the ass you are the most [ __ ] neurotic person every time we post an
01:33:16
episode we should cancel the episode we [ __ ] everything up again why do we keep screwing up we're going
01:33:22
to destroy them i read the first comments and the the down vote i was on youtube somebody sent the vote at the
01:33:29
following we'll keep going but go ahead the amount of noise we deal with from this one we're not going to stop it's
01:33:34
like literally he doesn't know you should not reward him it's like his inner model of feeding
01:33:40
crazy you know if you had a two-year-old child who you you've given too much candy to it can you can you shut them up
01:33:45
please yeah unbelievable this is all right one guy can shut your mouth up it's phil
01:33:50
deutsch everyone yeah yeah all right so it seems like a common theme on this stage these last couple days is you all
01:33:56
feel like we're in a recession or heading towards a recession but i get a feeling that you have the confidence
01:34:01
that this could be a quick recession like a year so my question would be why do you feel after 13 years of market
01:34:07
manipulation by the fed that it's gonna be cured in under a year no i think you're right the average
01:34:12
recession has measured like if you look back historically is two quarters um the problem is that we've never
01:34:20
really figured out what it's going to take with the distortion of money that never should
01:34:26
have been in the system because if you think of a supply demand imbalance as being a naturally self-balancing
01:34:32
phenomenon if you perturb one side of it by an enormous amount exactly to your point i think the open
01:34:38
question that the world has right now is is that really a two-quarter problem well the fed has told you that they're
01:34:45
gonna take three years to get three trillion you've heard from david that 10 trillion was put in
01:34:51
probably another three or four trillion was productively used but that still leaves another three
01:34:57
trillion of sloshing around money that we don't know so i think it's an open question i don't know what you guys
01:35:02
think fredberg how many months uh how many quarters sacks how many quarters have you had yes again i just
01:35:07
hate this definition of recession where it's about gdp decline when we had a lot
01:35:11
of the underlyings in those numbers for gdp that i feel were like artificially inflated for a couple of quarters
01:35:16
because of a bunch of the structural stuff we've talked about so i don't know like if you look deeper
01:35:21
at economic growth companies signing up more customers so like a lot of technology companies are about
01:35:26
increasing productivity with their tools with their with what they're selling and um those businesses are going to
01:35:32
continue to do well and to grow and to increase customers increase revenue um and i don't think that there's
01:35:39
necessarily a lot of the structural stuff that we saw with the gfc the one thing i am concerned about which i've
01:35:44
highlighted is this consumer credit risk and besides that it seems like you know things are um
01:35:51
you know on good footing so i don't know like the the technical recession definition
01:35:56
probably a couple quarters yeah um i you never know and i think the best way to to look at the future is by doing
01:36:04
scenario planning so we basically we could say this could be a you know short medium or long
01:36:11
recession short would be six months media might be 18 months and you know long might be two years plus
01:36:18
and we just say i don't know say one third one third one third probability and that kind of gives you
01:36:25
some picture 14 months yeah exactly so now what we're telling our portfolio companies is you want to have two and a
01:36:31
half years of runway right now because you got to go raise six months before you run out of cash and you really
01:36:36
want to have two years of cushion because things could be choppy for two years i'm not saying they're gonna be
01:36:43
but they could be you don't want your company to run out of money and die just because of macroeconomic conditions that
01:36:49
are no fault of your own so if you can try to engineer that amount of runway that's better
01:36:54
i also think that here's the thing about a quick recession is or the the prospect for one we don't
01:37:00
know what other shoes are going to drop consumer credit is still a shoe that we don't know if it's going to drop look
01:37:05
six months ago did we think we'd be talking about tiger global or sophomore for that matter potentially
01:37:12
teetering on the verge of being wiped out yeah redempted out of coinbase and peloton just so things with
01:37:20
the rings things can change fast we don't know what systemic risk is in the system that
01:37:25
hasn't been flushed out yet and i we won't be out of this until it feels like everything's been flushed out
01:37:31
and then the market's back and things are sort of an upward trajectory again clearly we're not there
01:37:35
real estate in crypto it doesn't feel like that's rushed out yet either so do we have a clip to play as an outro i
01:37:41
don't know is this uh was this the clip of the the cut clip before before we go can we please say thanks to the yeah
01:37:47
we're gonna have networks here yeah and the team jason your team at all in yeah incredible thank you everybody all of
01:37:52
you guys have worked so hard and they they really put a lot of effort into this it's pretty incredible
01:37:58
i guess this is a lost clip of us uh from last week you did not have like uh dungeon dragon
01:38:05
sleepovers in grade seven and grade eight i was actually programming pascal and we made a water moisturizer and it
01:38:12
was a binary lifter much like the ones you have a tattoo a complete replica of uncle owen's water
01:38:18
vaporizers on tatooine and that took six years but it was great and then i went hilariously as c-3po
01:38:31
3po to our science fair you should have seen the look on our teachers faces okay you guys have your cold open let's
01:38:40
go [Music] rain man [Music] david source it to the fans [Music]