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next up is my good friend tim urban from wait but y i asked him to do this as a favor he gets a huge speaking fee i i
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said we have no budget uh he said jacob i think it's 7 500 a second i said i have no budget i stole
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it all um and he has the number one talk uh in the history of ted on youtube
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my pal tim urban thanks brother
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[Music]
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[Music] he said something yesterday to nate
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silver when after about 181 poker and he's like you're not oh i'm going to take away your speaking fee and i was like the [Â __Â ] speaking fee
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all right so the title of my talk is tim talks about politics and other things that are probably a bad idea to talk about in
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front of all these people um and i want to start with why am i even
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writing about politics i don't like politics i like writing about the science and tech and the future and procrastination and things that interest
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me um but as i'm thinking about the future and all this awesome stuff that we could
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have i started to have a bad feeling i would think of society kind of like a giant organism and this is how i always
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grew up assuming that society was like it's like a big grown-up but when i looked around
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it looked more like a poopypants six-year-old who dropped its ice cream um and i feel like this is what a lot of
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people are kind of getting at in these talks you know we're talking about um kind of all this crazy polarization
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and you know mobs and to me i just look out and i see this i see i see kind of reverting and people are acting like
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they're in middle school and like you know we can't communicate and and what's going on so i i started putting my mind
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to this now what was the problem and the problem is very complicated and
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i'm not going to try to get into the whole thing today but i think that what we can do is uh have a better framework
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to talk about the problem um i think that we are very constrained to this one-dimensional axis it's like a
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straight jacket in our conversations you know you hear people say the problem is you know the far left and the far right
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we need to be in the center we need to be more moderate but what is that in the center is just a policy position right the far left and far right aren't
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inherently bad the far left is just kind of radical and questioning everything and they're experimental in the far
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right is just questioning maybe we messed up maybe we should go back to the way things were i mean there's nothing inherently better or worse about any
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part of this spectrum but we're using these words to try to get it something else we say centrist
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moderate we don't really mean in the middle of the spectrum i think we're talking about a different axis i call it the latter
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so i think bringing our political discussions into two dimensions can be hugely helpful now
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sometimes you'll see like the political compass you'll see you know politics in 2d but that's still all what you think that's all you know different ways to
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look at what you think about politics the latter is a how you think axis um so there's there's you know there's
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some nuance to it there it's it's a spectrum but for our purposes let's just focus on the two kind of core ideas here there's
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high rung political thinking and high-run politics and low-run politics
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um so the high rungs um you can kind of divide into hyrung
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progressivism and higher on conservatism which i kind of think is like two arguing giants like they're like you know you know the the the collective
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efforts of high rung progressivism conservatism are uh are are kind of like
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lawyers in a courtroom um they're they're they're they're heated they don't like each other a lot of the time they have very different ideas of how
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things should go um but it's kind of like you know the two lawyers in the courtroom this is kind of a wink that goes on where they understand ultimately
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they're on the same team they're two sides of a truth kind of discovery machine and i think this is the same
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thing they don't like each other but they're actually ultimately on the same team trying to figure out the road map how do we move forward and the conversations in high-run politics are
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complex they're nuanced you know it's it's there's different realms there's what is right there's science in history
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arguing about what is that's a that's hard to figure out there's what should be right that's that's philosophy and
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ethics then there's you know even if they agree on those two things uh how do we get there right what are the right
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policies strategies experimentation testing um so so there's a lot of nuance there's a lot of complexity and
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and one of the core defining features is if this is how you form beliefs right you know you go from i don't know some
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kind of process to i know high-run politics is all about truth they're geared towards truth they start here uh
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at i don't know there's there's kind of an inherent humility um to this process uh
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so i think of humility a little bit like uh trying to stay on a tightrope it's not
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easy right we uh we are uh you you it's easy for your confidence
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you know you have the dunny kruger thing your confidence shoots up when you first learn something and then it goes down uh
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after you uh you know realize you don't know as much as you know and then sometimes you can go too low and so when you go too low you're in the kind of
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insecure zone right you actually know more than you think you know um but you uh but but like you're you're
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just not you're even some kind of imposter syndrome um above the line you know we're in the arrogant zone very
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common in politics obviously you know you you think you know more than you really actually do um so like you know
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you could even measure it like this is how much you're full of [Â __Â ] how much above like the amount above the line you
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are um and in hiring politics look no one is great at staying on the tightrope it's very
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hard but it's the the the the culture of high run politics is helpful because it can
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actually uh it humbles you because people will disagree with you and it's cool in kind of a high-run political culture
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to be humble like if you say i don't know or you say yeah you know i i haven't thought about that issue that makes you seem smart in higher politics
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right it's so so it's encouraging whatever the culture finds cool we're going to do more of um
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a core thing about hiring politics we don't identify with our ideas so
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um i think you know ideas when you're in this zone are like a machine that you built it's like a
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hypothesis right you put the boxing gloves on you let your friends kick it you know go to town you know you throw it out there people try to argue with it
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you know the besties are big on this right they love an opportunity relish opportunity to just tell the other person they're wrong or here's why
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you're biased or here's why you have you know you're being hypocritical and this is what hiring politics is about no one takes it personally you're just kicking
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my machine and i'm saying i bet my machine can stand up to it and they're saying i bet it can and if it does man i just got more confident because i just i
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just realized this thing is is pretty strong if the if they break it it doesn't feel good but i just got a little smarter i just got a little bit
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less dumb because i learned something i was wrong about um so they're kicking it and you know you're watching them box is
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dialectic when you watch them box together sometimes you play devil's advocate you take the bat to your own idea this is this is you know kind of
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how you move up that humility tightrope to a more knowledgeable place uh principles wise um
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one of the things that defines high-run politics is consistency it's not again there's left right center so the
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principles will totally vary but there's consistency either way so classic example elon talking about
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yesterday free speech doesn't count to value the you know to fight for the free speech of people who you agree with
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every single person in history has had that principle that's the yellow zone it's very easy to support for your
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principles when it's also supporting your team the challenge comes when it's not when it's people you don't like saying things you don't like for example
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or or when it's your team trying to shut down the free speech of others and you know it's wrong even though you you do hate that speech that's when you have to
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choose green zone or orange zone high rung politics is great about staying in the green zone you will see them
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go against their own team all the time if it doesn't conflict if it doesn't jibe with their principles
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i think if you take a big step back this thing again it gets heated this isn't you know people mistake high-run politics that you know it's all we
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should be all you know we should be you know kind of uh withdrawn and and irrational but i think it's actually
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also it can be very passionate very emotional very heated people care deeply in higher they can form coalitions and
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do marches and still and stuff like that it's just that they care about truth they're consistent with their principles
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they don't identify with their ideas they like to argue and ultimately it's a positive sum game with a positive effect
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on the country this is what drives the country forward right in the science academy this is what drives uh
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knowledge forward right this this is what drives innovation forward is people able to disagree now
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we get to the other thing that is low running politics lowering politics i have a name for it i call it political
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disney world and i call it that because it's a land of rainbows and unicorns and a bunch of
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people who will not change their mind under any circumstances it's a land of good guys and bad guys
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the good guys are angels perfectly righteous the bad guys are awful in every possible way and the good guys
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have good ideas and the bad guys have bad ideas and there's a checklist in high rung politics if someone tells me
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their position on guns i have no idea what their position is on climate change or on abortion or on immigration in
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lowering politics you hear one position from someone boom i you can just look at their demeanor and i know every single
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position they've got on every single issue the same concept in lowering politics
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again no one thinks they're in low-run politics so people there will think yeah of course i value truth but they don't
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they're actually starting it i know they start at the checklist item and now they say well i have to prove this is correct
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so when they read an article they probably won't read the article but if they read the article that disagrees
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with them they'll meet they're they're they have a brick wall in their head about you know this can't be true this person is biased this is this is you
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know ad hominem whatever they um and when they read an article that agrees with them when they hear an opinion they'll just all that skepticism
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disappears and suddenly it must be true yes of course um so i talked about hiring politics it's
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like the ideas are like machines right it's not you know you don't get sensitive about it you kick the machine right low-rung politics it's like a baby
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a very cute baby who you love so much so people's ideas they're sacred in low-run
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politics and and this is why um you know you can kick a machine and no that's no big deal if you kick a baby you're an
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[Â __Â ] and so on the high rungs people can disagree if you have two axes
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here decency and agreement and they're totally different right you can have people that disagree with you that are awesome and vice versa you can have
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people that agree with you they're [Â __Â ] but in lowering politics it's very simple people who agree with you they're good people people who don't they're [Â __Â ] um so this is you know
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what it comes down to is you know you have a high wrong discussion and it kind of looks like this they're examining things lowering discussion it's like
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[Â __Â ] [Â __Â ] that's a cute baby god it's such a good baby how awful are people who don't like the baby so awful right
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this is very common if you listen to a low-run political discussion this is essentially what's happening they're
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sitting around and they're talking about how right they are and how awful the
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people and dangerous the people are who disagree with them and that's just they'll just talk about that forever and
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ever and ever principles same idea here you actually stick with the left circle you'll constantly a cl you know give
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away here for low rung politics is that when when when it's not convenient yellow circle territory they will almost
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always jump over to the orange circle you know you'll have again you know so free speech you'll see is a perfect litmus test if you you know as soon as
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it's free speech people you don't like all those principles disappear um we can you know how about coven marches uh all
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you know people are completely worked up about uh lockdown marches in right-wing states
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as soon as it's marches for racial justice all good all good this is this is a public health crisis right this is
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that's that's orange material how about all the people who are super anti
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uh you know immigration policies and surveillance policies and foreign policy and you know debt
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uh issues and then as soon as it's the other president now your president's in office all those same policies stay and you're fine with them um you know the
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classic example the debt was the worst thing in the world during obama's presidency and then trump comes in office starts doing these tax packages
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that are adding to it and suddenly it's no problem so there's endless examples here
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um if high rung politics is kind of this positive some game lowering politics i see it much more like two
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screaming giants um and and and and they're they're if the high rung kind of emergent
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property is intelligence and and progress the low rung emergent property is just strength and you know fighting
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for power it's a battle of good versus evil and the big the big goal is not you know not uh
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trying to create a more perfect union again they think that's the goal but the big goal really is beating the bad guys
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it's a zero-sum game that ultimately has a negative effect so i know i just threw a lot at you because i wanted to kind of
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cover the different bases of this to give a feel for what i'm talking about here this is the framework that i think is very useful i've been living with it
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now for a few years i've been having conversations with it and i find that it clarifies a lot and it helps with a lot of things like
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for example uh if you just think it's a horizontal axis a as i said you know you mistake
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that the far left and right must be the problem but it's not it's the low rungs that are the problem that's actually what people are trying to say the
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moderate centrist you know thing that's not what they're actually trying to say they're trying to say hi wrong which can expand the the horizontal axis uh
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there's more than one tug of war going on we think if you just have one axis well it's left versus right and that is a tug of war both in the high and low
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runs that is you know they are fighting for what they want but there's a tug of war going on from
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the north and south as well the the progressive i know a lot of people in here probably are thinking i'm in
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that upper left guy that's my guess and if that's true and it might be true
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um you you do have a tug of war going on against that upper right guy you also have a tug of war gone going on
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against that lower left guy uh this is the thing that i think is important to realize is when you have this that the
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people who are on your team you know they also hate trump or whatever uh they might be actually like the biggest
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impediment to what you care about politically they they undermine the progress of what you care about um it
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also can enhance kind of collaboration because if you're in that one of those upper giants the other upper giant is a
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lot more on your ultimate team if you take a big step back than the lower giant that wears the same color
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so once you start to i think this way i think it helps to to um kind of loosen some of the tribalism and give some
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nuance to our discussions and give some nuance to what we're trying to do now the story i wanted to talk about here is
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that this is okay this is normal by the way this is not a problem every democracy in the world will have this
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the founders knew this would be here the goal was not to uh suppress low wrongness it was to
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contain it and actually you know in the economy to harness it for progress but in politics to contain it so it can't
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totally take over they contain it by taking away the physical cudgel you know you can't just conquer
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and become a dictator like so many low-rung giants in other countries have done there's there's laws here and and and
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most importantly there's kind of a high-run immune system which is just vigorous defenses defense
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defense against low rung infringement low running this will try to shut down the conversations
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in the high rungs in the high rungs uh resist they say no [Â __Â ] off like uh
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we uh we we know you can't enforce your echo chamber upon us you're allowed to have your echo chamber that's fine you
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can't enforce it so this is how it's supposed to be now part of the reason we're all here continually you need to talk talking
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about man politics is awful and things are bad and there's a poopy pace pants six-year-old with the ice cream falling
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is because of i think we've had some big changes to the environment this is the kind of simple human
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equation i think about you've got human nature is constant the environment is what changes and that
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produces different behavior right you know the people who are really hardened during war you know they're not different
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biologically than us they just were put in a very different environment and it created different kinds of people so our environment has changed a lot and i
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think it's causing a lot of problems i think it's causing a low rung flare up if you know
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so here's one way to think about it in the 60s you've got intraparty factions within the parties
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right you have a lot of progressive republicans and conservative democrats and these these factions within the parties they hate each other right which
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is um which was a source of tribalism some people are just so focused on the other people in their party the other factions
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there's the national parties like we have that we talk about a lot today republicans and democrats nationally that was a source of tribalism and then
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there was this you know ussr and also before that hitler like there were all these you know scary foreign enemies
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that created this kind of macro tribalism on the national level so you have um
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patriotism which is one kind of tribalism but it also unifies down below and the intra-party
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factions might actually cause the national parties to collaborate sometimes so it's not that people were less tribal it's that tribalism was
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distributed what's happened is now the intra-party factions have disappeared because the conservative democrats have
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all gone to the republicans they're the progressive republicans have all gone for lots of reasons we can get into some other talk but
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that's waned there's still a little you still have bernie and you know hillary not liking you know there are people not like it but it's much less of a thing
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likewise you still have you know yes oh russia you know but mostly that's not the focus in fact uh
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the focus is is it's so not here that when there's a foreign thing now usually we'll just use it as like political
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fodder for our national debate uh you know oh the russians are on their side no they're on their side right there's no patriotism that unites anymore what
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you have is one big old political divide and all the tribalism from all those
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things is concentrated into one place which is an unhealthy that's not great i don't think that's good um and
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so this is one environmental change no one's fault it's just what happened then you know you also have a lot of things
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with like the electoral map you have between gerrymandering and you know geographic sorting you have
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purple counties turning you know mostly red and blue now which means primaries are actually electing the farthest right
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and left people as opposed to you know people who can win a general election there's a lot of other kind of little environmental changes but one huge one
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that we talk about is the media i think of a media i'd like to place them on a media matrix accuracy
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uh on the y-axis and objectivity so the where you want to be is the top middle right and actually for a long time there
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was an incentive magnet uh to be there for abc cbs nbc right they they didn't
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want to seem like they were inaccurate and they had to cater to the whole country which kept them somewhat close to that there was this incentive magnet
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today you have cable tv and then eventually you have you know talk radio and you've got um
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then the internet and all these websites you have tribal media which is a totally different set of incentives you cater to one side only you you it's more bias uh
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the the the uh the more clicks and accuracy is just not a concern to the audiences they end up having and then
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you have this feedback loop like was discussed yesterday where once you cater to that now you have to keep that
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going right you've now lost a neutral audience and um and so now we have a lot of americans super addicted to a really
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trashy reality show um real politicians of washington um
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and then it took me a long time to make this by the way [Applause]
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i think mcconnell's my favorite anyway um so then you've got of course
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the big bomb drops in our environment you've got social media this is a real graph
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showing people retweet things they agree with to people they agree with almost entirely right it's these algorithmic
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bubbles it's insane you know and so if you're one of the people that actually i follow all kinds of different people you're very rare because
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and and it didn't again it didn't used to be this way john ronson talks about you know how it used to be a radical d
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shaming like twitter you know you go on and be like oh i do this embarrassing thing people will be like me too and it'd be like oh so nice and fuzzy at the
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very beginning and then it turned into wait a second you know this bad guy is harassing women at work and now actually
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this woman has power for the first time she can talk about it on social media we can create a a whole kind of uh a
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coalition against it and he gets fired and it's exhilarating and this is good right this is speaking truth to power
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problem is now people are exhilarated and they're saying who's next right and you have this new source of power which again can
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be used for good but it's gotten picked up by a lot of the low-rung tribes who
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have started to use this cudgel um not started it's been a while now you know creating mobs to actually enforce
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low-rung politics and what happens is you end up with high wrong world very scared kind of caught off guard the
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normal defenses the normal immune system is not doing its job and so what happens when
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the high rung world gets scared this is a very you know it can set off a domino effect imagine we picture this is the high-run world
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these are brains this is what a bunch of high-rung people in a community think they all think different things based on
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the color right now if we draw a circle around them this is imagining what they're saying is the circles color so
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here is the perfect high-run community right everyone is it's a diverse you know thinking and they're saying what they're thinking and it connects
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together into this super brain and it's awesome right but now maybe the social media cudgel maybe something else starts
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to be a little bit scary and and this one group starts to say the only opinion that's okay is the orange opinion anyone
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who says anything other than the orange opinion is an awful person um the high wrong immune system supposed to
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kick in and say cool [Â __Â ] off if it doesn't say that everyone starts getting scared and then
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cowardice starts to spread and before you know it everyone's just saying the orange out loud even if they don't agree with it no one wants to outwardly say
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what they think anymore and the problem is you can't actually see what's going on in the brains you only know what
00:21:29
people people are thinking based on what they're saying so all people see is this so if you're this guy
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who actually has one opinion and actually is full of diverse thinking around them they don't know that they assume it must look like this
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everyone starts to feel like i'm the only one who thinks this i'm the only one who doesn't like this movement or
00:21:46
this politician or whatever and the group intelligence that's so awesome
00:21:52
about high-run politics it disappears i think what we're seeing is if what you know why why uh are
00:22:00
things so bad i i don't think it's because we moved to the far right and far left i think it's because you have a low rung flare-up
00:22:07
generated by changes of the environment and the high rungs have been caught off guard by really rapid environment
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changes and they've just disappeared they've shrunk away and the low rungs are running you know
00:22:19
buck wild you can see this on the right i think mostly in washington you see the debt ceiling you know being used as a
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weapon in a way that should never happen you see uh mcconnell and the senate not putting through a senate candidate uh a
00:22:32
supreme court candidate because it's the last year totally unprecedented that's not the rule and then four years later they go and they do they put their own
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candidate this is low-rung [Â __Â ] of course trump with the election i mean reagan's big thing was you know the the
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peaceful transition of power is what makes us special and you know trump of course is the exact opposite on the left
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i think we see it less in washington and much more in culture i think wokeness um is two things it's a far-left ideology
00:22:58
and it is far left it's you know post-modern and it's it's marxist and that's fine you can have those things in the high rungs the thing that makes
00:23:04
wokeness low-rung is the way they treat others you can you can go and have your own
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you can have your own echo chamber and do it with the what the the woke mantra is you know what a low rung person in a
00:23:16
liberal country is supposed to say is i don't like these ideas so i won't listen to them what uh what you're not supposed to be
00:23:22
able to say is i don't like the idea so no one is allowed to listen to them right a disinvitation on campus which
00:23:27
has become very common right um it's it's it's not saying i won't go to that talk which is a low-rung thing to say
00:23:33
it's much worse it's saying no one on this campus is allowed to hear that talk and we see that having played out we see
00:23:38
james bennett the editor of the new york times op-ed section getting fired because he published an op-ed by tom
00:23:43
cotton that 62 percent of the country agreed with but it didn't jibe with woke um
00:23:50
orthodoxy you see denise young at apple a black woman who's the head of diversity who says
00:23:55
to me diversity is not you know it's more complicated than just about something like race when i look at
00:24:00
12 blue-eyed blond-haired guys i see i see diversity i see different people diverse in different ways she was fired
00:24:06
for saying that um you can go on and on medical journals are retracting papers that have never
00:24:12
retracted papers before because double peer review papers because they get a rise on twitter from the woke mob
00:24:20
so i think we're seeing this in different ways but to me it's all one big story which is that we're having a low run flare-up and these low-rung
00:24:25
giants are out of hand they're doing things they're not supposed to be able to be doing and they're doing that because the immune system is failing and
00:24:31
that's why we all look like this now the good news is i do think this can change i don't think most people are like this i think most
00:24:38
people are and by the way if you think this is oh another binary divide we are all high rung and low rung at different
00:24:44
times and that's one of the big differences here um i think that if we want to get out of this and get back to here
00:24:49
we need two things we need uh awareness uh which is the first thing we need we
00:24:55
need to be aware of i think this this this axis and to think about not just
00:25:01
where am i being bullied intellectually where what's really the low rung thing and what's not but also where are we being lower on because we all can do
00:25:07
this this is this is this is a huge part of our brain that wants to go and identify with our ideas and
00:25:13
and be hypocritical so where am i doing it where are the people around me doing it and and maybe realizing okay maybe
00:25:18
the the people that on the high rungs when i am there that disagree with me horizontally maybe those are my friends
00:25:24
a lot more than the low-run people that are voting for the same candidate and finally awareness
00:25:29
without saying anything out loud is useless right you need awareness to have to be coupled with courage
00:25:35
uh people have to start speaking out and actually that's the high run immune system is built of
00:25:42
courage it's built of people actually standing up and you've seen this with some companies declaring we will not uh
00:25:49
we're not a political place that's courage in the face of a cudgel that's trying to get them to be political um
00:25:55
and so i think if you can have a little bit more awareness and a little bit more courage this kind of this low-run
00:26:00
flare-up can be i think uh controlled and i think we can end up in
00:26:05
a better place thank you
00:26:11
wow
00:26:18
amazing it's just truly epic what an amazing talk to follow um the
00:26:25
talk we had earlier i think with i don't know if you got to witness it the palmer lucky talk i was trying to think of how
00:26:31
to trash you because he was so popular so you were going to go low run yeah i was but i mean in fact
00:26:38
uh you know that i think palmer and i had some low rung moments where you know he was doing the anti-hillary stuff i
00:26:44
was dunking on him for it and then we saw an example of maybe adult high rung behavior of like hey let's sit here and
00:26:50
talk about the differences i want to put out there just talking about the woke movement for a second one
00:26:56
of the major challenges i had in this event was certain people attending the event
00:27:04
made some people in that group uh unwilling to come to the event
00:27:09
no offense keith um in other words like keith sachs you know and then even glenn grunwald and matt
00:27:17
greenwald i'm sorry and matt taibbi were triggers for certain people
00:27:22
to not come speak they were going to kick the baby they were going to kick the baby and so
00:27:28
i think and then on the right we have i think some pleasure in knowing you're triggering
00:27:35
the libs and it's exacerbated this it's hard for me as a conference producer or a podcast
00:27:42
producer to get the two sides to sit and just have a reasonable discussion of time how do we break that log jam of the
00:27:49
right just loves to troll and and trigger the libs and the libs are like i'm not even participating in the
00:27:54
discussion with this group of people that group of people you know the saxes the kids the
00:28:00
you know whatever i i think poor keith just came on stage yeah oh by the way please welcome keith for boy
00:28:10
he triggers a lot of limbs but let's start there and then keith
00:28:15
i'll i'd love to hear you respond to this dynamic which i know you were fully aware of yeah so i i think that that we can get
00:28:21
there's some clear definitions here uh not wanting to go to something that that
00:28:28
you know highrunger says oh they disagree with me great let me go and that's that's what they really want to hear because i'm going to learn
00:28:33
something right the lower runger says [Â __Â ] those evil awful people i'm not going to go right they storm away
00:28:39
fine you're in a liberal country live and let live you these are both okay um what's not okay is the low rungers uh
00:28:46
and pressuring you to kick off those speakers because otherwise they're going to start a a movement a petition a
00:28:52
boycott of your show that's gonna um that's gonna uh end up hurting you in some way you know you know taking you
00:28:58
know smearing you on social media and into to pressuring this to not happen at all that's saying no one's allowed to go
00:29:03
to that conference that's what's not okay it's interesting you bring this up i shared with you that
00:29:09
back channel it was beautiful there was there was back channel of you know how beautiful a
00:29:14
moment was with the high rung discussion we just had there was also a dark moment before the event where a group of people
00:29:21
who did not agree were doing what you're saying the woke mob was saying
00:29:26
we need to get other hello on the left [Applause] [Laughter] [Applause]
00:29:33
oh david sacks time they're supposed to tell me when robboy got here so there was literally to your point
00:29:39
an intolerance level of not only are we not going to come to all in summit because sacks or this person or that
00:29:45
person are there we're going to start telling other people to not go yeah and not participate it literally happened and i
00:29:51
had to stop but this is a so look this conference did happen those people did come ideas were spread so this is a
00:29:58
victory for high run this this is yeah [Applause]
00:30:04
so then to you keith um tell us why is it so pleasurable to
00:30:09
trigger the libs david keith uh no in all seriousness you love to debate you take all comers no problem you you want
00:30:16
to get in the arena what you're seeing now um how can i actually just interject on
00:30:22
that sure so i mean speaking for myself i don't get any pleasure in triggering libs and
00:30:29
that's not my objective and i don't think it's necessarily keith either what you're really doing is because we
00:30:34
are willing to debate and we're not afraid to have the conversation you're now redefining that as triggering other
00:30:41
people no we're not we're just willing to have a conversation
00:30:47
now yeah i think it's i think it's really easy to tell who are the people who have good points to make and are and
00:30:54
have intellectual confidence because they're the ones willing to show up and have conversations and i think it's the
00:31:00
biggest cop-out for anybody to say well i can't be your con because i see this name and this name on your agenda how
00:31:06
lame is that well and and to be honest you know a lot of the positions
00:31:12
um i think you and palmer probably disagree on the approach to ukraine he's probably very pro
00:31:18
supporting that and you might be a little more dovish yeah so i think two points first of all
00:31:24
i i i took on this fool's errand like 10 years ago of correcting everything wrong on the internet which is
00:31:36
but the reason why i did it was i felt like wow someone in um uh who doesn't know any better might read something
00:31:42
that's wrong and they might believe it and so at least if i start correcting it they'll see that there's multiple
00:31:47
perspectives and then they'll have to dig in as opposed to just take this for granted the second thing is yeah i have no desire to trigger the libs but i do
00:31:54
feel like i have a platform and i don't want to die without having used whatever influence i have to proselytize for
00:32:00
ideas i believe in so if i have 300 000 followers i feel i would be neglecting like my light like benefits in my life
00:32:07
if i'm not proselytizing for the few five six seven eight nine things i care about and so i don't want to wake up one
00:32:13
day and say i wish i had done x y or z and it could have maybe changed the world
00:32:18
can i ask him a question around his name's tim hey nice to meet you tim david how are
00:32:24
you we actually haven't met before um uh
00:32:29
do you think that over time content has gotten shorter sound bites have become kind of the primary form of
00:32:36
content you know we used to be that we'd sit down and read books and we'd read newspapers and we'd watch these
00:32:41
long-form newshour conversations and then you know things got shorter they got faster they
00:32:47
got quicker and as a result we ended up kind of debasing ourselves and ending up in this point where everything has to be
00:32:52
reduced to that primal instinctual reaction moment and it gets even
00:32:59
more significantly fueled by the feedback loops associated with social media so the things that you see more of
00:33:04
are the things that really do trigger that kind of primal you know um emotional
00:33:10
sense more is that a big driver do you think societally in terms of have we become more tribal
00:33:16
over the last century yeah i mean i think environmental changes are just it's like they will
00:33:23
produce behavioral changes and it can be sometimes a feedback loop where you have shorter content more
00:33:29
emotional you know kind of triggering content like you said tr you know there's there's almost like pheromones
00:33:35
evolutionarily it wins yeah well and all you know on twitter actually there's a phenomenon where
00:33:40
actually um virality dumbs down information because
00:33:45
uh nuanced information doesn't hit as hard totally and so it's when you have um it's you if it's it's kind of like um
00:33:53
it's like evolution where you see you know that the tweet that ends up super viral it's it's you know survived 100
00:33:58
other competing tweets to get there and the ones that are rising to the top um it's a mechanic there's a mechanism
00:34:04
right now that is that is pushing this kind of forming a magnet down in political disney world that is pulling
00:34:10
us down and one of the questions i you know have for elon is like what what's how can that somehow be you know what
00:34:16
one idea that um a friend and i were kicking around is like some kind of almost like um
00:34:22
uh you know wikipedia managed to somehow stay um somewhat you know nuanced and neutral in
00:34:29
a way and and could there be some kind of like giant 10 000 pool you know of moderators um that actually kind of put
00:34:36
you know rank things by maybe high rung and low rung um and and the algorithm doesn't necessarily suppress the
00:34:42
lowering stuff it just doesn't push it which right now the algorithm in is you're talking about like moderation
00:34:47
editorialization almost yeah at least like to give it like a credit rating on maybe a high low scale um i kind of view
00:34:54
this as like a muting effect it's like an institutionalization of these social networks where everyone talks about them
00:35:00
being free to run as a network without kind of a central system of control but sometimes that central system of control
00:35:07
has an important role in playing moderation muting editorialization that will kind of avoid some of the adverse
00:35:13
consequences it's definitely optimizing downwards right now what do you think keith yeah should elon buy should elon
00:35:20
buy twitter and then yeah well i sort of disagree i mean i grew up in the 70s and 80s and sound bite you know was the term
00:35:26
of art for like 30 second commercials and that's how we debated politics was 30 second commercials i don't know any
00:35:31
evidence that suggests that tweets today in politics are worse than the 30-second commercials i grew up with and if you
00:35:37
think about polarization i also watched used to watch europe european politics in the 70s and 80s the most extreme ends
00:35:43
of politics you ever see we don't have any of those extremes in the united states still today yeah so i don't think there's i think a lot of people like
00:35:49
make arguments without evidence that things have changed and i actually start with like first principles like wait
00:35:55
where's the evidence like people talk about this information there's no evidence that the american voter in 2016 had less information or less accurate
00:36:01
information than 1888 or 1894 or 1910 in fact the opposite is true by most but
00:36:07
most serious studies yeah so this is all kind of made up in my mind yesterday i should buy twitter to save the world but
00:36:13
it's not going to be a good financial investment what how does it save the world do you think well we need a free speech
00:36:19
platform where people can debate ideas and the left wing of twitter the employee base has completely suppressed
00:36:26
ideas for example my husband i happen to know this wrote an article on foreign policy magazine
00:36:31
like the most prestigious publication in the entire planet for foreign policy debate about the ccp
00:36:37
twitter refused for years to allow him to advertise that article published in foreign policy magazine so there's
00:36:43
clearly someone on twitter suppressing content that's critical of the ccp and we tried appealing to everybody and they
00:36:49
wouldn't change this so there's either chinese spies there or a left-wing culture that you know suppresses debate
00:36:54
this is foreign policy magazine you can't get any more prestigious than that it's absurd let alone the fact that i
00:36:59
have 300 000 followers and do not have a blue check i must have the largest follower of anybody who doesn't have a
00:37:04
blue check and it's all because i have views that are unacceptable that that seems really pretty ridiculous considering many other
00:37:12
vcs who are meaningfully less credentialed of course experiences
00:37:17
there's obvious and i have you know insiders that twitter have sent me screenshots of various things there's no doubt that it's a left-wing model
00:37:23
culture that's suppressing ideas and someone needs to fix that either government needs to fix it which is worse than elon fixing it but the
00:37:29
government if the u.s congress has turned over there's going to be a lot of subpoenas flying over to twitter because there are absolutely foreign governments
00:37:35
influencing some of those decisions at twitter well i mean it it was in fact proven that there were
00:37:42
saudis inside of twitter uh saudi nationals yes the best tweet retort ever by elon
00:37:48
yeah i wish i would be that good yeah i mean what was the tweet well you know the the the saudi prince was complaining
00:37:55
i mean he said uh please explain freedom of speech and how that works in your country oh right yeah i mean
00:38:01
the process can you explain cancel culture
00:38:08
in your framework yeah so um i like to use a couple terms here
00:38:14
there's there's social bullying which is no one uh
00:38:20
if you disagree with me you can't be my friend um and again that's okay right i don't
00:38:26
think you're an awesome person if you act like that but you're allowed to um then there's what i would call idea
00:38:31
supremacy um which is you know it's kind of um it's it's it's like like i've been
00:38:38
saying no no one is allowed to say this thing whether you're my friend or not and and and you know if you want to run
00:38:46
something on your own property you can make all the speech rules but cancel culture is specifically going into
00:38:52
places that are supposed to be high rung you know what you know what it says on top of harvard college veritas right
00:38:58
veritas which is which is them that is that is them putting their stake down on the ground and saying we are a high
00:39:04
wrong place they're not say using those words but they're that is what they're saying we are a place that cares about truth that cares about diversity of
00:39:09
ideas they write it cares about openness and inquiry and curiosity and all of this uh and so cancel culture it goes into
00:39:16
places like that or google you know you you know started off they had their all hands meetings it was all about you know
00:39:21
and every idea is good criticize the leadership like you know you know right so these things were specifically high wrong right they were founded on these
00:39:27
things canceled culture goes into those places and says our preferred echo chamber now those
00:39:34
rules apply to everyone here and it's a power you know you're not a lot of things want to do that right a lot of you know i'm sure the pro-lifers would
00:39:40
like to go into campuses and say no one can have a pro-choice position they don't have the power cancel culture is a product of
00:39:46
a group that's not supposed to have the power to do that having the power to do that and i think that comes from the
00:39:52
fear of social media it comes from this hyper-charged tribalism in the environment we live in right now and a
00:39:57
lot of things and let me give you a solution so one of the solutions to many things in life is moving to miami and
00:40:02
i'm serious about this ladies and gentlemen mayor uh
00:40:09
one of the most stark things when we moved to miami 17 months ago was in miami you ha it's incredibly refreshing
00:40:15
because everybody has a different position there's literally no environment socially politically culturally business-wise where you won't
00:40:22
run into people who voted for biden or for trump like you cannot go to a dinner of eight people and have people have the same views you cannot work in a company
00:40:28
where people ha don't haven't voted or given their views and if you try to caricature people you're gonna be wrong all the time even i catch myself like
00:40:35
assuming this person of this demographic is going to be liberal and they're not and so here people learn to both be
00:40:40
polite um like sort of like when you were growing up you were taught like you don't debate religion in front of people at dinner people are polite but also
00:40:47
they have to engage and it's incredibly refreshing because people learn to partake in arguments and it would be
00:40:52
impossible to live in miami successfully unless you do this every day and so i think this is a model for
00:40:57
america like many things in miami but keep over time doesn't that transform so like isn't there a concentration of ideas of
00:41:04
mimetics that ultimately kind of ruled the juice and you know this whole thing kind of eventually
00:41:10
you end up with with you know two pull two poles two camps i mean isn't this how all society start the great debate
00:41:17
the great conversation this is a microcosm of what just happens with human behavior over time because if you understand ideas so one of the benefits
00:41:23
for me was i grew up in like the most woke environments ever i spent years at stanford and then harvard like pretty woke places
00:41:29
and all my professors in political science were super liberal but i i was conservative the whole time and every
00:41:34
one of my you know essays if you read my final exams they're all conservative because i had to learn to master all the
00:41:39
liberal arguments and find the weaknesses and the data points and be able to marshal evidence and that's a healthy thing so when you encounter
00:41:45
people who have different views like for example you know there's controversial laws in florida don't say gay quote
00:41:51
unquote you know changes in abortion policy here people here will talk about them politely and debate them and that's
00:41:58
good for everybody like i bet you for example like you know if you read the media or you read twitter you think this
00:42:03
abortion law changed in florida is radical it's actually more permissive than any european country but no of us
00:42:09
nobody knows that france actually only allows abortion up to 14 weeks germany is like 16. so we're 20 here so we're
00:42:15
more liberal than europe but nobody talks about that on twitter that way but if you lived in florida you would actually know that by the way the
00:42:21
campuses you just described they're not here anymore you you the amount of testimonials from from students saying
00:42:26
if i disagree with the professor on my exam i will get a bad grade even worse again this is there when
00:42:32
there's encroachment by a low rung giant and there's no push back it will keep going so they've gone to some crazy
00:42:37
places here's an example berkeley right now and and ucla and about 20 other schools
00:42:43
um if you uh you want to apply to be a chemistry professor
00:42:49
the first thing that you do is you have to fill out a diversity statement and there and it's called that sounds nice a diversity statement but it's actually
00:42:55
you have to basically prove that you have a proven track record of social justice activism of the woke variety not
00:43:00
not mlk style social justice very specific social justice in this and if you are not a proven activist that has
00:43:07
the right political it's more than even a political litmus test you have to actually be an activist to get it to even be seen by the chemistry department
00:43:13
they won't even show the chemistry so there's the stories like that you're just like oh my god but that's what happens when the immune system is
00:43:19
failing this the the things will continue so what is the what is the antidote to that if we for those of us
00:43:24
that can't move to miami well everybody can we welcome we welcome new people those of us that haven't yet
00:43:30
yes the antidote is leadership because what happens is uh in each one of these stories you know james bennett getting
00:43:36
fired from the new york times right read the story in detail um you know mcniel is another example for the new york
00:43:41
times for a whole long story but in each story the you the leadership
00:43:47
often because leadership is you know most people are not insane like this almost every this is again with the orange circles almost everyone
00:43:53
actually thinks this is insane these firings and that's what's scary is they're happening anyway so in each of these stories you see a moment when the
00:43:59
leadership first says well you know here we do agree even though i i hate his views too uh uh you know we we we value
00:44:06
a diversity of a viewpoint and then there's huge pushback and there's a moment of truth are they going to stand
00:44:12
up for the veritas and for the for the core values are they going to are they going to or are they going to cede the
00:44:18
culture to the mob and what canceled culture is is these moments of truth the leadership
00:44:24
choosing cowardice and the the the actual cudgel of the social media doesn't actually hit the person
00:44:30
it's the leader actually going and actually firing them the leader's the one who ends up actually being there standing up to the
00:44:36
mob as opposed to letting the mob rule you yes which is which is the hard thing in a lot of these currencies it's hard
00:44:41
to do you think about we we see all these companies in silicon valley well we see it when we do the podcast we had
00:44:47
a moment and we were discussing the don't say gay slash parents choice
00:44:54
bill which you look at the framing of that it's completely hilarious that like we framed it as
00:45:00
those two things either you're like you don't want parents to be able to parent their kids or you hate gay people it's
00:45:05
like really is that what we're talking about here and we looked at it and a couple of besties were having the
00:45:10
conversation i won't say who and we were trying to get educated on it and i'm like should
00:45:16
people be able to talk about their gay parents in first grade second grade third grade of course you're a parent
00:45:22
you're gay i'm assuming you don't want people to be able to tell you you can't be talked
00:45:27
about at school and then i was like end gender assignment and what gender you choose and now we're sitting there going
00:45:33
i don't actually know enough about this should you introduce that you can be one of 40 genders at six years old or 12
00:45:40
years old when should sex education start i actually don't know i we learned at 15 should it be 12 i don't know and
00:45:47
we're we were like is this a discussion we can have on the podcast without us actually consulting with some
00:45:54
people who know more than us and discussing it and i've written about three or four tweets about the the trans
00:45:59
um swimmer and i have feelings on it but i'm like should i actually tweet
00:46:06
that i find it's profoundly unfair that this person gets to win every single
00:46:12
women's meet and i kind of feel bad for the women who now can the best they can do is second place is am i going to get
00:46:18
cancelled for that because that was my initial response to it and i don't actually know my position because i don't know that
00:46:25
other person story who's a trans woman and maybe she does deserve to be in that i
00:46:31
don't know if anybody has an answer for that so i'm curious you know from the besties themselves you
00:46:36
know what what are your thoughts on um are tackling some of those things and and not getting cancelled or
00:46:44
these things happen on every dimension every day which is you have more questions and answers i think tim you
00:46:49
wrote it in the slide it's kind of like you're navigating between high conviction and you know high knowledge
00:46:56
but that's a path and that path happens because you can talk to other people and you can ask questions and you can figure
00:47:02
out where you are today you can figure out where you could be tomorrow that's what's not allowed anymore right
00:47:08
on any on any dimension it's not any one specific issue it's on so many topics right and the thing with that is that it
00:47:15
gets people very afraid and then when you are afraid i think to your point what happens is you take the most
00:47:21
simplest reductive point of view that can be the most acceptable on any topic whatever and this is what causes this
00:47:28
snowball literally i'm scared to talk about the trans issue because i feel like i don't know enough i also don't want to hurt
00:47:35
anybody's feelings i would feel terrible if i did hurt his feelings so the reason you want to talk about it is because the
00:47:40
social costs of even taking the risk of having that conversation outweigh any
00:47:45
potential benefit it's just the conversation gets so hot but i want to i want to go back to what tim said that
00:47:51
the moment of truth is when the leader of the organization has the choice of whether to fire the
00:47:57
person who the mob is going after it seems self-evident that the leader shouldn't basically join the mob and
00:48:05
inflict mob justice on this uh poor employee but they do anyway and the
00:48:10
question is why and i would argue that the reason why is because they're afraid of the new york times hippies that's it
00:48:17
that's what it comes down to they're afraid that the woke mob will come after them next and we've seen it before when brian
00:48:23
armstrong implemented his policy of no politics in the workplace at coinbase who then retaliated against him he got a
00:48:29
new york times hit piece that was they are the enforcement wing of the woke mob when elon said that he would restore
00:48:36
free speech to twitter what was the response the new york times wrote an article basically trying to
00:48:43
uh identify him with the apartheid regime in south africa even though he was a kid the headline of the article
00:48:49
didn't even match up with the body of the article the body of the article had a modern story it was about him as a
00:48:55
child it was also a historical account of you know a bunch of oppressive things that happened in south africa and in it
00:49:02
when he was a child right he was so the body of the story had nothing but anecdotes about how he even as a young
00:49:09
adolescent basically rejected apartheid and yet the headline the story was
00:49:15
basically painting him with this brush so basically calling him a racist no and and it came from his dad and they have a
00:49:22
super complicated relationship and so it was like the it was like the one person where you couldn't have necessarily guaranteed what would have come out of
00:49:28
errol's mouth and it was still so supportive of elon musk yeah right so so if we're gonna overcome this problem
00:49:34
i think we have to have this recognition that you know that these um prestige outlets
00:49:41
like the new york times who for some reason have so much credibility in our culture they have the power or they used
00:49:47
to have the power to basically destroy people's careers we have to realize that these are just
00:49:53
um places that have been hijacked by radicals and like their stories are meaningless they're completely biased we
00:50:00
have to stop investing them with the cultural power to like destroy people it's that simple
00:50:06
what happens is there's a lag time now do fox news they don't here's the difference they don't have the cultural power to destroy
00:50:13
anyone and who have they destroyed name somebody like what woke mom have they engineered mike the pillow guy
00:50:20
i think i'm not saying look i'm not saying they wouldn't if they could i'm just saying that they can't because they
00:50:26
don't have that kind of cultural power before we uh tim you were going to say something i was going to say when an institution like this gets what happens
00:50:33
is a mob like this that they don't build anything you know they don't
00:50:38
create what they do is they appropriate they hijack something they take its existing good
00:50:44
reputation which is real which is a lot of power and they spend it down it's not constructive it's destructive yeah yes
00:50:50
but but they'll actually go in like it's like they they like they take over and they and they spend the reputation down
00:50:55
but in the lag time between when the reputation catches up it can do a ton of damage so again i would say that you
00:51:01
know a lot i'm scared about what's going on in like ivy league institutions that they have so much credibility but and a lot of really bad
00:51:07
things have kind of happened there and it's yeah can i suggest we pivot to tech and investing while we've got keith here
00:51:13
because we're going to leave thank you for joining us and we've decided to do a crossover
00:51:23
keith and i were talking backstage and i was like what investments have you made he's like i've made no investments in 2022. and you guys have like how big is
00:51:30
your latest fund five billion five billion dollar latest fund and you haven't made any investments well the fund as a whole has made some
00:51:36
investments i haven't let anybody but you haven't yet i haven't led any new investments in 2022 yeah last year i'd led the 13 or 14 in a year so to go to
00:51:44
to go to effectively zero for half the year is like me being on vacation can you tell us what your point of view is
00:51:50
well i mean i tweeted in october but uh you know that we were at the height of the market i tweeted last january that
00:51:56
we're gonna see 2000 all over again and so privately internally i've been arguing this internally that this is
00:52:01
exactly what's going to happen and so you know my behavior should reflect my views i believe in some consistency and
00:52:07
harmonization so if i believe tech stocks and tech companies aren't worth that much i can't be investing until they reset and so i don't want to spend
00:52:14
money and invest in companies that aren't going to make me money my job is to ultimately return billions of dollars to my lps and if i can't do that i
00:52:20
shouldn't be giving anybody any money so when do you change your mind well there are founders who are head of the curve
00:52:25
there always are who understand where the world's going they actually understand the world where the world's going better than i do they actually teach me about where the world's going
00:52:32
more typically and if they have appropriate expectations i'm happy to invest so the last three or four investments i did make actually were all
00:52:38
interestingly enough about 1.5 million dollar investments where the founder walked in and said you know i don't need
00:52:44
a lot of money i can accomplish a lot i can achieve inflection moments for a very small amount of capital that was
00:52:49
the easiest thing ever to say yes at 1.5 million dollars i don't need to think about the macro world i don't need to
00:52:54
think about where the you know nasdaq's going and so the last three or four investments were all incredibly
00:52:59
disciplined founders that i made like late last year into like arguably into january now we have doubled down just to
00:53:05
be clear about our conversation we have doubled down in portfolio companies where we've led new rounds but as far as
00:53:11
a new investment from scratch i haven't made any new ones this year so when you double down in a moment like this how do
00:53:16
you set valuation especially if the last valuation was maybe felt like a top tick um if i think the
00:53:23
founder has sort of digested where the world is then you know we have a dialogue about valuation otherwise i
00:53:29
actually encourage them to go shop it like i'm saying like we will give you money but will you price it at the same mark at a discount now if they have a
00:53:35
fair market valuation from top tier firms we'll try to be like in that zone but they'll often go to the market and
00:53:41
people will be like either pass past pass pass pass or they will give them you know just reality and then we'll
00:53:47
match that but we've done that a few times where we've encouraged founders typically we wouldn't do this because uh my partner brian singerman loves to
00:53:54
power money into companies that are working that's been we've been a high conviction fund for about a decade so typically if we like a company we'll
00:54:00
lead the next round and leave the next round we've done this with ramp for example we've played like three or four rounds but now with evaluation reset going on
00:54:07
it's been easier sometimes with founders i really like to say why don't you go talk to 500 people well it's just like go talk to five
00:54:13
other people and i'll match what they do if they're really top tier people but like i want you to get like fair market
00:54:19
feedback you know not just have to rely upon my judgment card are we at the point in the cycle where the down routes
00:54:25
the warrants the the the um liquidation preferences have
00:54:31
happened or are starting to be discussed definitely seeing a lot of lick preferences again explain what it is and why that's
00:54:37
important yeah so liquidation preference basically means that the the
00:54:42
the investor is going to get their money back first regardless of what happens in the world and that nobody who's a
00:54:47
shareholder nobody is a founder is going to get it nobody's a common shareholder which basically means founder employee is going to get any money until
00:54:54
the investor gets all their money back times some multiple and that multiple is based on time and or
00:55:00
just a hurdle it's very scary but it can be arbitraged by success founders sometimes can arbitrage it well
00:55:07
meaning they have asymmetric information about the future of the company if they really believe they can hit escape velocity in a short period of time it
00:55:13
can be a decent gamble i've seen someone like jack dorsey at square did this very sophisticated uh ceo and he knew what he
00:55:20
was doing and knew why he was doing it and it's worked out pretty well actually but it's it you're playing with a lot of fire so it's not for everybody and you
00:55:27
should get a lot of feedback and advice before the flat rounds are definitely happening the new flat is the up brown kind of
00:55:33
philosophy even in some of our better reports are those senior like pref or perry it depends
00:55:38
depends on the round um they're all over the map actually so the market hasn't shifted to the point that every new money coming in senior to all
00:55:45
other money then how much leverage and what quality investors you have on your cap table like so for example someone tries to put a senior lick preference on
00:55:51
top of my capital i'm going to yell at them a lot and if they ever want a new investment that we're you know from our
00:55:56
fund they may not want to do that do you think that we're um a couple turns away what the godfather
00:56:01
the discount rounds well some companies are going to have to try the problem is like for example we don't like to do those rounds there's so
00:56:08
much brain damage in the politics of that with founders with prior investors walk us through that why tell us about
00:56:13
that so typically if a foul you think there's an efficient market of pricing right like i need this much capital and the
00:56:19
market's going to float what the price of that capital is in private capital it's not really true
00:56:24
like so if someone comes to me and says you know my last round was done at 300 million you know nine months ago
00:56:29
and today it'd probably get priced at let's say 120 million i'm more likely to say no than to give
00:56:36
them an offer at 120 because i know their prior investors and their prior employees are going to be mad at me and
00:56:42
furious at me and i don't want a lot of founders and people annoyed at me
00:56:48
and so that brain damage isn't worth it so i'm more likely in our fund is more likely to say no then try to find
00:56:54
whether 80 100 120 140 is the appropriate price which is very bad for the company in some ways because you
00:57:01
they they might need the capital you started them of money yeah now they may be able to find somebody else but we typically at founders fund really don't
00:57:07
like to do those rounds the only way we would consider it is pretty much everybody on the cap table called this
00:57:13
up the founder or ceo the board members prior investors said we really want you to do this and like we're all
00:57:18
collectively holding hands and want you to do this then we seriously consider it do you at the end of q1 do you guys sit
00:57:24
around and reset valuations and marks before you tell your lps what these companies are worth meaning your own
00:57:30
sense when you sort of generate a a sense of valuations like yeah we do mark down proactively we do proactively mark
00:57:36
down what's your methodology for that peter's views
00:57:43
i mean i think i think peter said we'd be open to to doing that if we felt like we had an objective
00:57:49
methodology for doing it it's very tricky um i think you can if you it later stage one's a little bit easier because you can apply multiples there's
00:57:56
public com you know public comps and you just adjust to that i think the earlier stage stuff
00:58:01
very difficult to do objectively and it's also not that sen you're probably not as sensitive to it in terms of what it move how it moves the needle but the
00:58:07
growth stuff we try to use public comps and be like realistic what do you think about um let's just
00:58:13
we'll just throw out some firms just if you had to guess um the next 18 months for some of these
00:58:19
folks softbank vision fund wanted i mean you know my views on softbank have been obvious since i did a new york times of all
00:58:25
things interview 2016. you should re-read the transcript but i was like that strategy just does not work um powering money into
00:58:32
companies and hoping that money is the key asset and the key ingredient for success has been false in in the history
00:58:38
of technology for 50 years and so that you know they lost 27 billion dollars again the brands subprime they used to
00:58:44
do well in latin america but they got rid of the person who actually knew what he was doing so this is a catastrophic mess plus it has moral issues you know
00:58:51
less moral issues than before but still you know not not the best investor tiger
00:58:58
i think they have a skill set gap if they're going to try it from what i read publicly they're trying to invest in serious and serious b companies the
00:59:04
skill to be successful in investing series a and series b companies is very different than leading growth rounds or
00:59:10
private or public growth rounds i mean we look at this in our fund and we do both we have a venture fund of 1.8
00:59:15
billion and a growth fund of 3.2 billion and we have part the investment team is basically the same
00:59:20
most of the investment team maybe all the investment team is better at one or the other and if tiger thinks that
00:59:26
they're going to be successful series a investors they're in for a very rude awakening i know about five or ten people on the planet that are successful
00:59:32
series a investors it is a very different discipline than deploying capital at large yeah sequoia
00:59:38
i think you know sequoia is the best run fund historically um they are really good at what they do
00:59:44
obviously the world is changing around them like i think like many people crypto you know is kind of throwing the
00:59:51
little monkey wrench in their model um they have to scale their explain that what do you mean they missed the first wave of crypto um and crypto you know
00:59:59
has returned a decent amount of money for people um and so i think that's tarnished the brand a bit with crypto
01:00:05
people specifically but they're working on fixing that they have a really good team the team is aging still pretty well
01:00:11
one of the hardest things in venture is you age non-gracefully in this job um you know by the time you're my age
01:00:16
you're probably too you're already past your prime and you know i kind of compare it because i went to a law
01:00:21
school with people who are u.s senators and i had breakfast in miami with one of the more prominent u.s senators and i
01:00:27
said i'm basically getting to the tail end of my career in tech and he said i'm in the bottom 20 of uh the youngest 20
01:00:33
in the u.s senate and so there's a big contrast um but anyway um i think i think they're excellent to what they do
01:00:39
for boyfriend senate sorry or boyfriend senate you might run for senate oh i'm not ready for senate no maybe my husband
01:00:45
second career yeah uh jacob take the politics andreessen um and crypto they're excellent
01:00:53
hey let me ask you a question i want to take the other side of the crypto missing the last crypto
01:00:58
insanity if this thing does all get torched as it seems to be and nobody shipping actual products that
01:01:05
touch customers that actually saw problems in the world sitting out you know that crazy
01:01:12
frenetic moment might actually look astute because
01:01:17
you know some of these projects i do not see them shipping products i
01:01:23
think that you're saying something that's practically true but i think keith is also saying something that is
01:01:28
practically true which is if you're a fund that has that crypto deal flow
01:01:34
at least my understanding of that playbook is you seed a project you
01:01:39
make sure that you get some amount of the float of tokens you're allowed to monetize those tokens very quickly and
01:01:45
so as long as you're in the flow there's money to be made there's a lot of money to be made and i think what
01:01:51
keith is saying and this is where sequoyah may have made an excellent decision which is that form of money
01:01:57
making is not very reliable and i think that there's going to be a lot of questions about
01:02:02
that once there's a regulatory framework yes and it might turn into is that you know a lot of people
01:02:07
three points mostly i agree with that i think first of all it depends what you think your vision of what a venture fund does or what you do as a partner so to
01:02:14
me i think i'm in the company building mode and so people who are not building companies i'm not really interested in making money i'm not i'm not in hedge
01:02:20
fund mode so tokens without successful products and iconic companies aren't interesting to me even if they return
01:02:25
capital we did think at founders fund though all the alpha was in bitcoin so going back a decade not me but my
01:02:31
partners bought a lot of bitcoin and we made a lot of money with bitcoin because we thought the alpha was there not in the company building a year or two ago
01:02:38
we started a shift and i think appropriately i think there may be some alpha now we're in the end of one business founders fund meaning the right
01:02:45
founder it's worth us investing the wrong founder it's not and so there are crypto projects in crypto companies
01:02:52
where the founder is extraordinary and we would love to be the primary investor if we can and then there's a bunch of
01:02:58
other companies that might be successful but that's not our business we are in the end of one find the next elon
01:03:03
isn't the fundamental problem that a lot of the way these crypto projects are designed is that you don't have
01:03:08
protective provisions preferred shares and the operating system that venture runs on
01:03:14
nothing and they're asking you to give them a donation of a hundred million dollars for a token that has some
01:03:20
panamanian foundation and you don't have a board seat i mean this seems incredibly high risk and undisciplined
01:03:27
they are high risk but we're in the business of high risk in some ways like the protective provisions i think we don't really care that much about them
01:03:33
at founders fund it is one of the theses that you know peter started the fund with which is these terms are way overrated that ultimately the companies
01:03:40
that succeed are the real the facebooks the palantirs you know the spacex's that's where you make your money in this
01:03:45
business and you're worrying about what goes with those companies it's actually words they do have boards and i actually believe in boards but i believe in
01:03:50
boards as being a mentor consigliere not in governance of course okay great but you're not buying
01:03:57
e cheese i never give a term sheet i never give a term sheet that has a board provision for me the founders requires
01:04:03
me to join the board got it but i mean the tokens are i think are part of the problem that i can't get my head around
01:04:08
yes the issue with tokens is a little more structural of when you have liquidity prior to success that's not necessarily a good incentive like i
01:04:15
think success liquidity should follow success with product follow with users follow attraction not be in advance and
01:04:22
i think that's just those teams when they get flush with a billion dollars in tokens or a hundred million in tokens
01:04:27
they wind down the price and they haven't shipped the product yeah it has misaligned misaligned or bad or perverse
01:04:33
incentives all over talk about you you're mentioning in the back um in a moment like this
01:04:39
the people that it's hardest for right after the entrepreneur is you said the junior partners at these organizations
01:04:45
uh just describe the dynamic now of having to run an organization where you're trying to tell people just go to
01:04:50
the beach for a year yeah i mean i think look the way you make the way you become successful in venture is you give money
01:04:55
to a founder who turns it into an iconic company that is how you get promoted right that's that's the job and so if
01:05:01
you tell your colleagues like well don't make any investments right now they're thinking in the back of the mind well how do i how do i become successful
01:05:08
so it's easy for me to say this it's easier for peter to say this is easier for brian to say this but it's not so
01:05:13
easy for people who want to make their career to say don't make any investments now that said if you make a lot of bad
01:05:18
investments symbol shaw has a good blog post about this your portfolio is your career once you make five or ten investments in venture
01:05:25
if those aren't good you're never going to get great i don't know there's a single example of like a vc who became
01:05:30
successful where the first five or seven exactly didn't show some signs of brilliance it's literally the story of the people
01:05:36
on the stage right now is that we either got lucky or we were good or some combination of the early investments
01:05:42
actually hitting oh i'm definitely worse like my first five investments three of them became public companies and stuff
01:05:48
like that definitely worse than they used to be i mean i hit two unicorns in the first four how does it happen it's just luck i
01:05:54
think i i do think there's some luck to it or maybe your network well network so for me it was easy because these were people
01:06:00
that we worked david and i worked with at paypal and i was smart enough to at least you know follow the people that were launching companies after paypal and
01:06:06
give them some money so i didn't have to know much about venture other than just follow my former colleagues we have to
01:06:11
wrap and go to lunch we're going to end with sax telling us his most illustrative
01:06:18
and funny story about keith roboy oh my god from stanford
01:06:24
so many good ones some great moment with keith i don't know um the two of you this is
01:06:32
you could you could feel the friendship and all the memories coming through for saks right now all these great i could
01:06:38
flip it keith and maybe some sass i like the work that keith and i did at paypal better i guess yeah okay whatever
01:06:44
stanford paypal give us the give us the moment what do you think for the best stories well one good one that i think
01:06:49
is instructive is you know like i was kind of this opinionated person running around all the time um probably half
01:06:54
right half wrong and david was basically running the company at the time and i could occasionally sabotage some
01:07:01
projects and david had a really good way of reframing and channeling my energy which i think is applicable to most
01:07:06
people he's like basically i don't mind if you send me any of this feedback but you have to send it to me directly not to other people and then you would like
01:07:13
filter it if it's like if you were like if it's right i'll act on it and if not you know et cetera i'll debate it with you but it was actually constructive for
01:07:20
the organization so i felt liberalized liberal liberalized to basically give the feedback and try to you know edit
01:07:26
our course and it would be channeled and use useful but it wasn't distracting people and so i think that is something
01:07:31
like a lesson i've taken with me that i actually now use as a ceo i heard i this is what's so crazy about this i've heard
01:07:37
this exact story from reid hoffman tell me that about you i think it was either it was either paypal or at linkedin
01:07:43
where you would probably use emails and it was just like lighting everybody and everything on phone the emails were
01:07:49
good though those were really emails like letters from a boy i reread the
01:07:54
emails and i'm like [Â __Â ] i can't write that well anymore letters from her boy a memoir let's give
01:08:00
it up let your winners ride
01:08:06
rain man david
01:08:13
and they've just gone crazy with it [Music]
01:08:34
we should all just get a room and just have one big huge because they're all just useless it's like this like sexual
01:08:39
tension that they just need to release [Music]
01:08:45
your feet
01:08:52
[Music] i'm going on
01:08:59
[Music]
