SPEAKER_04: Next up is my good friend Tim urban from wait, but why I asked him to do this as a favor He gets a huge speaking fee. I said we have no budget He said Jake I think it's 7500 taken. I said I have no budget. I stole it all And he has the number one talk in the history of Ted on YouTube my pal Tim urban
SPEAKER_05: He said something yesterday and said Nate silver when he after about when eight one poker and he's like, you know Oh, I'm gonna take away your speaking fee and I was like the fuck speaking fee 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 front of all these people And I want to start with why am I even writing about politics? I don't like politics I like writing about the science and tech in the future and procrastination and things that interest me But as I'm thinking about the future and all this awesome stuff that we could 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 grew up assuming that society Was like it's like a big grown-up, but when I looked around It looked more like a poopy pants Six year old who dropped its ice cream And I feel like this is what a lot of people are kind of getting at in these talks, you know, we're talking about Kind of all this crazy polarization and you know mobs and all and to me I just look out and I see this I see kind of reverting and people are acting like they're in middle school and like You know, we can't communicate and what's going on. So I started putting my mind to this now, what was the problem and The problem is very complicated and I'm not gonna try to get into the whole thing today But I think that what we can do is have a better framework to talk about the problem I think that we are very constrained to this One-dimensional axis. It's like a straight jacket in our conversations You hear people say the problem is you know, the far left and the far right We need to be in the center 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 inherently bad The far left is just kind of radical and questioning everything and they're experimental and the far 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 part of this spectrum But we're using these words to try to get at something else. We'd say centrist 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 So I think bringing our political discussions into two dimensions can be hugely helpful now 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 look at what you think about politics. The latter is a how you think axis So there's there's you know, there's some nuance to it there. It's a spectrum but for our purposes Let's just focus on the two kind of core ideas here There's high rung political thinking and high rung politics and low rung politics so the high rungs You can kind of divide it to high rung progressivism and high rung conservatism Which I kind of think like it's like two arguing giants like they're like, you know, you know the collective efforts of high rung progressivism conservatism are Are kind of like lawyers in a courtroom They're there. They're they're heated. They don't like each other a lot of the time They have very different ideas of how things should go, but it's kind of like, you know The two lawyers in a courtroom this is kind of a wink that goes on where they understand ultimately They're on the same team. They're two sides of a truth kind of discovery machine And I think this is the same thing. They don't like each other But they're actually ultimately on the same team trying to figure out the roadmap How do we move forward and the conversations in high rung politics are complexed. They're nuanced, you know, it's it's there's different realms There's what is right though science and history arguing about what is that's that's hard to figure out There's what shouldn't be right that's that's philosophy and ethics then there's you know, even if they agree on those two things How do we get there? Right? What are the right policies strategies experimentation testing? So so there's a lot of nuances a lot of complexity and if 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 kind of process to I know high rung politics is all about truth They're geared towards truth. They start here at I don't know there's there's kind of an inherent humility to this process So I think of humility a little bit like trying to stay on a tightrope it's not easy, right we we are It's easy for your confidence, you know You have the Dunning-Kruger thing your confidence shoots up when you look first learn something and then it goes down After you, 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 insecure zone, right? You actually know more than you think, you know But you but but like you're you're just not you're even some kind of imposter syndrome Above the line, you know, we're in the arrogant zone very common in politics Obviously, you know you you you think you know more than you really actually do so like, you know You could even measure it like this is how much you're full of shit how much above like the amount above the line you are and In high-run politics look no one is great at staying on the tightrope. It's very hard, but it's the the the culture of high-run politics is helpful because it can actually It humbles you because people will disagree with you and it's cool In kind of a high-run political culture 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 high-run politics, right? It's it's so it's incurred whatever the culture finds cool. We're gonna do more of A core thing about high-run politics. We don't identify with our ideas So I think you know Ideas when you're in this zone are like a machine that you built. It's like a 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 You know the besties are big on this right? They they love an opportunity relish opportunity to just tell the other person They're wrong or here's why you're biased or here's why you have you know, you're being hypocritical And this is what high-run politics is about no one takes it personally You're just kicking my machine and I'm saying I bet my machine can do it. I'm saying I bet my machine can do it And I'm saying I bet my machine can stand up to it and they're saying I bet it can't and if it does man I just got more confident because I just I just realized this thing is pretty strong if they if they break it It doesn't feel good, but I just got a little smarter I just got a little bit less dumb because I learned something I was wrong about So they're kicking it and you know, you're watching them box is 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 how you move up that humility tightrope to a more knowledgeable place principles wise One of the things that defines high-run politics is consistency. It's not again. There's left right center. So the principles will totally Vary but there's consistency either way. So classic example elon talking about yesterday free speech doesn't count to value the you know To fight for the free speech of people who you agree with every single person in history has had that principle That's the yellow zone It's very easy to support for your 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 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 choose green zone or orange zone high-run politics is great about staying in the green zone. You will see them Go against their own team all the time if it if it doesn't conflict if it doesn't jibe with their principles 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 oh it's we should be all you know We should be you know, kind of withdrawn and and and irrational but I think it's actually also it can be very passionate Very emotional very heated people care deeply in higher they can form coalitions and do marches and still and stuff like that It's just that they care about truth. They're consistent with their principles. They don't identify with their ideas They like to argue and ultimately it's a positive some game with a positive effect on the country This is what drives the country forward right in the Science Academy. This is what drives Knowledge forward right this this is what drives innovation forward is people able to disagree now To the other thing that is low-running politics lowering politics. I have a name for it. I call it political Disney World And I call it that because it's a land of rainbows and unicorns and a bunch of people who will not change their mind Under any circumstances. It's a land of good guys and bad guys The good guys are angels perfectly righteous. The bad guys are awful and everybody's right Guys are awful in every possible way and the good guys have good ideas and the bad guys have bad ideas And there's a checklist in high-running politics. If someone tells me their position on guns I have no idea what their position is on climate change or on abortion or on immigration in low-running politics You hear one position from someone boom. I you can just look at their demeanor and I know every single position They've got on every single issue The same concept in low-running politics again, no one thinks they're in low-running politics So people there will will think yeah, of course I value truth, but they don't 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 So when they read an article They put they won't read the article But if they read the article that disagrees with them, they'll meet their their 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 know ad hominem, whatever they And when they read an article that agrees with them when they hear an opinion There's all that skepticism disappears and suddenly it must be true. Yes, of course So I talked about hiring politics it's like the ideas are like machines right it's not you know You don't get sensitive about it. You can't kick the machine right low-running politics It's like a baby a very cute baby who you love so much so people's ideas They're sacred in low-running politics and and this is why You know, you can kick a machine and no that's no big deal. If you kick a baby, you're an asshole and so on the high rungs People can disagree if you have two axes 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 people that agree with you and their assholes, but in low-running politics, it's very simple people who agree with you They're good people people who don't they're assholes So this is you know, what it comes down to is, you know, you have a high-running discussion and it kind of looks like this They're examining things low-running discussion. It's like fucking shit. 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? This is very common If you listen to a low-run political discussion, this is essentially what's happening They're sitting around and they're talking about how right they are and how awful the people and dangerous The people are who disagree with them and that's just they'll just talk about that forever and ever and ever Principles same idea here. You actually stick with the left circle. You'll constantly You know giveaway here for low-running politics is that when when when it's not convenient yellow circle territory They will almost 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 know as soon as it's free speech people You don't like all those principles disappear We can you know, how about coven marches all you know, people are completely worked up about Lockdown marches in right-wing states soon as it's marches for racial justice Marches for racial justice all good all good. This is this is a public health crisis, right? This is that's that's orange material How about all the people who are super anti? You know immigration policies and surveillance policies and foreign policy and you know debt Issues and then as soon as it's the other president now that your president's in office all those same policies stay and you're fine with them You know the classic example that the debt was the worst thing in the world during Obama's presidency and then Trump comes in office starts doing up these tax packages that are adding to it and Suddenly, it's no problem. So there's endless examples here If high-run politics is kind of this positive some game lowering politics. I see it much more like two screaming giants and and and and they're there if the high-run kind of Emergent property is intelligence and progress the low-run emergent property is just strength and you know fighting for power It's a battle of good versus evil and the big the big goal is not you know Not trying to create a more perfect union again. They think that's the goal but the big goal really is beating the bad guys 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 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 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 for example If you just think it's a horizontal axis a as I said, you know You you mistake 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 moderate centrist, you know think that's not what they're actually trying to say They're trying to say high rung which can expand the the horizontal axis 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 rungs That is you know, there are fighting for what they want, but there's a tug of war going on from the north and south as well The the the progressive I think I know a lot of people in here probably are thinking I'm in that upper left guy That's my guess And if that's true and it might be true 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 against that lower left guy This is the thing that I think is important to realize is when you have this that the people who are on your team You know, they also hate Trump or whatever They might be actually like the biggest impediment to what you care about politically. They undermine the progress of what you care about It also can enhance kind of collaboration because if you're in that one of those upper giants The other upper giant is a lot more on your ultimate team We take a big step back then the lower giant that wears the same color so once you start to I think this way I think it helps to to kind of loosen some of the tribalism and give some 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 that this is okay. This is normal, by the way This is not a problem every democracy in the world will have this the founders knew this would be here. The goal was not to Suppress low-rungness. It was to contain it and I've actually you know in the economy to harness it for progress But in politics to contain it so it can't totally take over they contain it by taking away the physical cudgel You know, you can't just conquer and become a dictator like so many low-rung Giants and other countries have done There's there's laws here and and and most importantly there's kind of a high-rung immune system, which is just vigorous defenses defense Defense against low-rung infringement low-rungness will try to shut down the conversations in the high rungs in the high rungs Resist they say no fuck off like we We know where you can't enforce your echo chamber upon us. You're allowed to have your echo chamber. That's fine You can't enforce it. So this is how it's supposed to be now Part of the reason we're all here continually in each talk talking about man politics is awful and things are bad and there's a poopie paste pants Six-year-old with the ice cream falling is because of I think we've had some big changes to the environment This is the kind of simple human equation. I think about you've got human nature is constant The environment is what changes and that produces different behavior, right? You know the people who are really hard and during war, you know, they're not different 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 think it's causing a lot of problems. I think it's causing a low-rung flare-up if So here's one way to think about it in the 60s. You've got intra party factions within the parties where you have a lot of progressive Republicans and conservative Democrats and the These these factions within the parties. They hate each other right which is Which was a source of tribalism some people are just so focused on the other people in their party the other factions 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 there was this you know USSR and also before that Hitler like there were all these you know Scary foreign enemies that created this kind of macro tribalism on the national level. So you have Patriotism which is one kind of tribalism But it also unifies down below and the intra party factions might actually cause the national parties to collaborate sometimes So it's not that people were less tribal. It's that tribalism was distributed What's happened is now the intra party factions have disappeared because the conservative Democrats have 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 That's waned. There's still a little you still have Bernie and you know Hillary not liking you know They're the people not like it, but it's it's much less of a thing Likewise you still have you know yes, so Russia, you know, but mostly that's not the focus in fact 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 fodder for our national debate. You know all the Russians are on their side I know they're on their side right and there's no patriotism that unites anymore What you have is one big old political divide and all the tribalism from all those things is concentrated into one place Which is an unhealthy that's not great. I don't think that's good. And 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 with like the electoral map you have between gerrymandering and you know Geographic sorting you have purple counties turning, you know, mostly red and blue now Which means primaries are actually electing the farthest right and left people as opposed to you know people who could win a general election There's a lot of other kind of little environmental changes, but one huge one that we talked about is the media I think of a media. I'd like to place them on a media matrix accuracy On the y-axis and the objectivity so the you want to be is the top middle right and actually for a long time there was Incentive magnet to be there for ABC CBS NBC, right? They didn't want to seem like they were inaccurate and had to cater to the whole country which kept them somewhat close to that There was this incentive magnet today. You have cable TV and then eventually you have, you know, talk radio and you've got 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 it's more bias the The more clicks and accuracy is just not a concern to the audiences they end up having and then you have this feedback loop like was discussed yesterday where once you Cater to that now you have to keep that going right you've now lost a neutral audience And and so now we have a lot of Americans super addicted to a really trashy reality show real politicians of Washington And then I took me a long time to make this by the way I Think McConnell's my favorite anyway so Then you've got of course the big bomb drops in our environment. You've got Social media. This is a real graph showing people retweet things. They agree with two people. They agree with almost entirely, right? It's these Algorithmic 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 And 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 de-shaming like Twitter, you know You go on and be like, oh I do this embarrassing thing people would be like me too And it'd be like oh so in vice and fuzzy at the very beginning and then it turned into wait a second You know this bad guy is harassing women at work And now actually this woman has power for the first time she can talk about it on social media. We can create a whole kind of Coalition against it and he gets fired and it's exhilarating and that's good right? This is speaking truth to power Problem is now people are exhilarating they're saying who's next right and you have this new source of power Which again can be used for good but it's gotten picked up by a lot of the low-rung tribes who have started to use this cudgel That started it's been a while now, you know And creating mobs to actually enforce low-rung politics and what happens is you end up with high-rung world Very scared kind of caught off guard the normal defenses. The normal immune system is not Doing its job. And so what happens when 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-rung world. These are brains This is what a bunch of high-rung people in a community think they all think different things based on the color Right now if we draw a circle around them, this is imagining what they're saying is the circles color So here is a perfect high-rung community, right? Everyone is it's a diverse, you know thinking and they're saying what they're thinking in it connects together into this super brain And it's awesome, right but now maybe the social media cudgel Maybe something else that starts 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 who says anything other than the orange opinions an awful person The high-rung immune system supposed to kick in and say cool fuck off if it doesn't say that Everyone starts getting scared and then 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 what they think anymore and the problem is you can't actually see what's going on in the brains You only know what people are thinking based on what they're saying. So all people see is this so if you're this guy 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 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 this politician or whatever and The group intelligence that's so awesome about high rung politics. It disappears I think what we're seeing is if what you know, why why are things so bad? I don't think it's because we move to the far right and far left. I think it's because You have a low rung flare-up Generated by changes of the environment and the high rungs have been caught off guard by a really rapid environment changes and they've just disappeared They've shrunk away and the low rungs are running, you know 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 Weapon in a way that should never happen you see McConnell and the Senate not putting through a Senate candidate a Supreme Court candidate because it's the last year totally unprecedented. That's not the rule then four years later They go and they do they put their own candidate through this is low rung shit. Of course Trump at the election. I mean What Reagan's big thing was, you know, the peaceful transition of power is what makes us special and you know Trump of course is the exact opposite on the left. I think we see it less in Washington and much more in culture I think wokeness is Two things it's a far-left ideology and it is far left. It's you know postmodern and it's it's Marxist and that's fine You can have those things in the high rungs the thing that makes Wokeness low rung is the way they treat others you can you can go and have your own But you can have your own echo chamber and do it with the woke mantra is you know? What a low rung person in a liberal country supposed to say is I don't like these ideas So I won't listen to them What a what you're not supposed to be able to say is I don't like the idea So no one is allowed to listen to them right with a dis invitation on campus, which has become very common, right? It's it's it's not saying I won't go to that talk which is a low rung thing to say 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 James Bennett the editor of the New York Times op-ed section getting fired Because he published an op-ed by Tom Cotton that 62% of the country agreed with But it didn't jive with woke Orthodoxy you see Denise young an apple a black woman who's the head of diversity who says to me diversity is not you know It's it's more complicated than just about something like race when I look at 12 blue-eyed blonde haired guys I see twit. I see diversity. I see different people diverse in different ways. She was fired for saying that you Can go on and on medical journals are retracting papers that have never retracted papers before because Double peer review papers because they get a rise on Twitter from the woke mob 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 rung flare-up and these low rung 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 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 people are and by the way, if you think this is all another binary divide We are all high rung and low rung at different times and that's one of the big differences here I think that if we want to get out of this and get back to here We need two things who we need awareness Which is the first thing we need we need to be aware of I think this this this this axis and to think about Not just where am I being bullied intellectually where what's really the low rung thing? And what's not but also where are we being low rung because we all can do this this is this is this is a huge part of our brain that wants to go and and identify with our ideas and and Be hypocritical. So where am I doing it? Where are the people around me doing it and and maybe realizing? Okay, maybe the the people that on the high rungs when I am there that disagree with me horizontally Maybe those are my friends a lot more than the low rung people that are voting for the same candidate and finally awareness Without saying anything out loud is useless right need awareness has to be coupled with courage people have to start speaking out and actually that's the the high rung immune system is built of Courage, it's built of people actually standing up and you've seen this with some companies declaring. We will not We were not a political place. That's courage in the face of a cudgel that's trying to get them to be political And so I think if you can have a little bit more awareness and a little bit more courage this kind of this Low-rung flare-up can be I think Controlled and I think we can end up in a better place. Thank you Wow
SPEAKER_04: Truly epic what an amazing talk to follow The 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 to trash you because he was so popular
SPEAKER_05: So you were gonna go low rung? Yeah, but I mean in fact
SPEAKER_04: You know that I think Palmer and I had some low rung moments where you know, he was doing the anti Hillary stuff I 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 talk about the differences I want to put out there just talking about the woke movement for a second One of the major challenges I had in this event Was certain people attending the event Made some people in that group unwilling to come to the event No offense Keith In other words like Keith sacks, you know, and then even Glenn Grunwald and that Greenwald. I'm sorry and Matt Taibbi Were triggers for certain people to not come speak. Well, they're gonna they were gonna kick the baby They were gonna kick the baby. And so I think and then on the right We have I think some pleasure in knowing you're triggering the libs and it's exacerbated This it's hard for me as a conference producer or a podcast producer To get the two sides to sit and just have a reasonable discussion at time How do we break that logjam of the righteous loves to troll and trigger the libs and the libs are like I'm not even Participating in the discussion with this group of people that group of people, you know, the Saxes the Keats the you know
SPEAKER_03: Whatever. I think we're keeping just
SPEAKER_04: Please welcome keifer boy
SPEAKER_06: He triggers a lot of libs
SPEAKER_04: But let's start there and then Keith I'd love to hear you respond to this dynamic which I know you were fully aware of yeah
SPEAKER_05: So I think that we can get some clear definitions here Not wanting to go to something be that that you know high-ronger says oh they disagree with me great Let me go and that's that's that's what they really want to hear because I'm gonna learn something right The low-ronger says fuck those evil awful people. I'm not gonna go right they storm away fine You're in a liberal country live and let live you these are both. Okay? What's not okay is the low-ronger in pressuring you to kick off those speakers because otherwise they're going to start a movement a petition a boycott of your show that's gonna That's gonna end up hurting you in some way, you know It's threat, you know taking you know smearing you on social media and into pressuring this to not happen at all That's saying no one's allowed to go to that conference. That's what's not okay. It's interesting you bring this up. I shared with you that
SPEAKER_04: Back channel. It was beautiful. There was back channel of you know, how beautiful the moment was with the high-rung discussion
SPEAKER_04: We just had there was also a dark moment before the event where a group of people who did not agree Were doing what you're saying the woke mob was saying We need to get other hello on the left David Sachs time they're supposed to tell me when Rob way got here
SPEAKER_04: So there was literally to your point an intolerance level of not only are we not gonna come to all-in summit? Because sacks or this person and that person are there We're going to start telling other people to not go. Yeah and not participate It'll literally happen and I had to stop but this is a so look this conference did happen
SPEAKER_05: Those people did come ideas were spread. So this is a victory for high-run this this is yeah
SPEAKER_04: So then to you keep Um, tell us why is it so pleasurable to trigger the limbs David Keith? No in all seriousness you love to debate you take all comers. No problem. You want to get in the arena? What you're seeing now? How can I actually just interject on that? Sure. So I mean speaking for myself
SPEAKER_02: I don't get any pleasure in triggering libs and that's not my objective and I don't think it's necessarily Keith's either What you're really doing is because we are willing to debate and we're not afraid to have the conversation You're now redefining that as triggering other people. No, we're not. We're just want to have a conversation Now yeah I think it's really easy to tell who are the people who have good points to make in our and have intellectual confidence Because they're the ones willing to show up and have conversations And I think it's the biggest cop-out for anybody to say well I can't be your comfort because I see this name and this name on your agenda. How lame is that?
SPEAKER_04: What and and and to be honest, you know a lot of the positions I think you and Palmer probably disagree on the approach to Ukraine. He's probably very pro Supporting that and you might be a little more dovish
SPEAKER_01: Yeah, so I think two points first of all Hey, I took on this fool's errand like ten years ago of correcting everything wrong on the internet But the reason why I did it was I felt like wow someone in in He doesn't know any better might read something that's wrong and they might believe it and so at least if I start correcting it They'll see that there's multiple 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 feel I have a platform and I don't want to die without having used Whatever influence I have to proselytize for ideas. I believe in so if I have 300,000 followers I feel I would be neglecting like my light like benefits of my life 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 day and say I wish I had done X Y or Z and it could have maybe changed the world Can I ask him a question around his name is Tim hey nice to meet him David free are you
SPEAKER_06: We actually haven't met before
SPEAKER_06: Do you think that over time Content has gotten shorter sound bites have become kind of the primary form of content You know we used to be that we'd sit down to read books and we'd read newspapers and we watch these long-form news hour conversations and then you know things got shorter they got faster they got quicker and as a result we ended up kind of Debasing ourselves and ending up in this point where everything has to be reduced to that primal Instinctual reaction moment and it gets even more significantly fueled by the feedback loops associated with social media So the things that you see more of are the things that really do trigger that kind of primal, you know emotional Sense more is that a big driver. Do you think societally in terms of have we become more tribal over the last century?
SPEAKER_05: Yeah, I mean I think I think environmental changes are just he it's like they will produce behavioral changes and It can be sometimes a feedback loop where you have shorter content more emotional You know kind of triggering content like you said, you know, there's there's almost like pheromones Evolutionarily it wins. Yeah. Well and all you know on Twitter actually there's a phenomenon where actually Virality dumbs down information because nuanced information doesn't hit as hard totally and so it's when you have it's if you it's it's kind of like It's like evolution where you see, you know that the tweet that ends up super viral It's it's you know survived a hundred other competing tweets to get there and the ones that are rising to the top It's a mechanism. There's a mechanism right now. That is that is pushing This kind of forming a magnet down in political Disney world that is pulling us down and I one of the questions I you know Have for Elon is like what what's how can that somehow be? you know what one idea that a friend and I were kicking around is like some kind of almost like You know Wikipedia managed to somehow stay Somewhat, you know nuanced and neutral in a way and and could there be some kind of like giant 10,000 pool, you know of moderators That actually kind of put you know rank things by can maybe high rung and low rung And and the algorithm doesn't necessarily suppress the lower stuff It just doesn't push it which right now the algorithm in is you're talking about like moderation editorial ization almost Yeah, at least like to give it like a credit rating on maybe a high low scale I kind of view this as like a muting effect
SPEAKER_06: It's like an institutional ization of these social networks where everyone talks about them being free to run as a network Without kind of a central system of control, but sometimes that central system of control has an important role in playing moderation muting editorial ization that Kind of avoid some of the adverse consequences. It's definitely optimizing downwards right now. What do you think Keith?
SPEAKER_04: Should you on by Twitter and then I Sort of disagree. I mean I grew up in the 70s and 80s and soundbite, you know
SPEAKER_01: Was the term of art for like 30-second commercials and that's how we debated politics was 30-second commercials I don't know any evidence that suggests that tweets today in politics are worse than the 30-second commercials I grew up with and if you think about polarization, I also watched you swatch Europe European politics in the 70s and 80s Yeah, the most extreme ends of politics you'll 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 make arguments without evidence that things have changed and I actually start with like first principles like wait, where's the evidence like people talk about this information? There's no evidence that an American voter in 2016 have less information or less accurate information than 1888 or 1894 1910 in fact the opposite is true by most by most serious studies Yeah, this is all kind of made up in my mind And yes, you know, I should buy Twitter to save the world, but it's not gonna be a good financial investment
SPEAKER_07: What how does it save the world?
SPEAKER_01: well, we need a free speech platform where people can debate ideas and The left wing of Twitter or the employee base has completely suppressed ideas For example, my husband I happen to know this wrote an article in Foreign Policy magazine Like the most prestigious publication in the entire planet for foreign policy debate about the CCP Twitter refused for years to allow them to advertise that article published in Foreign Policy magazine So there's clearly someone at Twitter suppressing content that's critical of the CCP and we tried appealing to everybody and they wouldn't change this So there's either Chinese spies there or a left-wing culture that you know suppresses debate. This is Foreign Policy magazine We can't get any more prestigious than that. It's absurd let alone the fact that I have 300,000 followers and do not have a blue check I must have the largest follower of anybody who doesn't have a blue check and it's all because I've used unacceptable that that seems really
SPEAKER_07: Pretty ridiculous considering many other VCs who are meaningfully less credentialed of course experience There's obvious and I have you know insiders that Twitter have sent me screenshots of various things
SPEAKER_01: There's no doubt that it's a left-wing monoculture that's suppressing ideas and someone needs to fix that Either the government needs to fix it which is worse than Elon fixing it But the government if the US Congress is turned over There's gonna be a lot of subpoenas flying over to Twitter because there are absolutely foreign governments influencing that some of those decisions at Twitter
SPEAKER_03: Well, I mean it was in fact proven that there were Saudis
SPEAKER_04: inside of Twitter Saudi national yes, the best tweet retort ever by you. Yeah. Yeah. I wish I would be that good
SPEAKER_01: Yeah, I mean what was it tweet? Well, you know, the the Saudi prince was complaining and he said that please explain freedom of speech
SPEAKER_00: And how that works in your country. All right. Yeah, I mean
SPEAKER_03: to the process
SPEAKER_07: Can you explain cancel culture in your framework, yeah, so
SPEAKER_05: I like to use a couple terms here. There's their social bullying which is no one If you disagree with me you can't be my friend And again, that's okay, right? I don't think you're an awesome person if you act like that, but you're allowed to Then there's what I would call idea supremacy which is you know, it's kind of It's it's it's like the bad like I've been saying 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 something on your own property You can make all the speech rules, but cancel culture is specifically going into Places that are supposed to be high rung, you know what you know what it says on top of Harvard College Veritas, right? Veritas which is which is them that is that is them putting their stake down on the ground and saying we are a high rung place They're not say using those words, but that is what they're saying We are a place that cares about truth that cares about diversity of ideas They write it cares about openness and inquiry and curiosity and all of this And so cancel culture it goes into places like that Google, you know, you know started off and they had their all-hands meetings It was all about you know, and every ideas good criticized the leadership like, you know, you know, right? So these things were specifically high rung right that they were founded on these things cancel culture goes into those places and says Our preferred echo chamber now those 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 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 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 fear of social media. It comes from this hypercharged Tribalism in the environment we live in right now and a lot of things You're doing so one of the solutions to many things in life is moving to Miami and I'm serious about
SPEAKER_04: One of the most stark things when we moved to Miami 17 months ago was in Miami you ha it's
SPEAKER_01: Incredibly refreshing because everybody has a different position. There's literally no environment socially politically Culturally business wise where you won't 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 where people Don't haven't voted or doing the views and you try to caricature people you're gonna be wrong all the time Even I catch myself like assuming this person if this demographic is gonna be liberal and they're not and so here people learn to both Be polite like sort of like when you're growing up you were taught like you don't debate religion in front of people at dinner People are polite but also they have to engage and it's incredibly refreshing because people learn to partake in arguments And it would be impossible to live in Miami successfully unless you do this every day And so I think this is a model for America like many things in Miami, but keep over time doesn't that transform?
SPEAKER_06: So like isn't there a concentration of ideas of memetics that ultimately kind of rule the juiced and you know this whole thing kind of Eventually you end up with with you know, two pole two poles two camps I mean isn't this how all society start the great debate the great conversation? This is a microcosm of what just happens with human behavior over time because if you understand ideas
SPEAKER_01: So one of the benefits for me was I grew up in like the most woke environments ever I spent years at Stanford and then Harvard like pretty well places and all my professors and political science were super liberal But I was conservative the whole time and every one of my you know says if you read my final exams They're all conservative Because I had to learn to master all the 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 people have different views like for example, you know, there's controversial laws in Florida Don't say gay quote unquote, you know changes in abortion policy here people here We'll talk about them politely and debate them and that's good for everybody Like I bet you for example, like, you know, if you read the media you read Twitter You think this abortion law change in Florida is radical It's actually more permissive than any European country, but no was nobody knows that France actually only allows abortion up to 14 weeks Germany is like 16. So we're 20 here So we're more liberal than Europe, but nobody talks about that on Twitter that way But if you live in a Florida you would actually know that by the way the campus as you just described
SPEAKER_05: They're not here anymore You the amount of testimonials from students saying if I disagree with the professor at my exam, I will get a bad grade Even worse again, this is there when there's encroachment by a low-rung giant and there's no pushback. It will keep going So they've gone to some crazy places. Here's an example Berkeley right now and and UCLA and about 20 other schools if you Want to apply to be a chemistry professor 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 you have to basically prove that you have a proven track record of social justice activism of the woke variety Not live not MLK style social justice very specific social justice in this and if you are not a proven activist It has the right political it's more than even a political litmus test. You have to actually be an activist to get it It's even be seen by the chemistry department. They won't even show the chemistry. So there's stories like that You're just like my god, but that's what happens when the immune system is failing this the things will continue So what is the what is the antidote to that if we for those of us that can't move to Miami?
SPEAKER_07: Well, everybody can we welcome we welcome you those have it yet
SPEAKER_05: The antidote is leadership because what happens is in each one of these stories, you know James Bennett getting fired from New York Times, right? You read the story in detail you know McNeil is another example for the New York Times for a long story, but
SPEAKER_05: In each story the you the leadership often because leadership is you know The most people are not insane like this almost this is again with the orange circles almost everyone Actually thinks this is insane these firings and that's what's scary is they're happening Anyway, so I know each of these stories you see a moment when the leadership first says well, you know here We do agree with even though I hate his views, too I you know, we we value a diversity of a viewpoint and Then there's huge pushback and there's a moment of truth Are they gonna stand up for the Veritas and for the for the core values? Are they gonna are they gonna or are they going to a seed the culture to the mob and in the cancel culture is is these moments of truth the leadership choosing cowardice and The actual cudgel of social media doesn't actually hit the person. It's the leader But actually going and actually firing them the leaders the one who ends up actually being standing up to the mob as opposed to letting
SPEAKER_06: The mob rule you yes, which is which is the hard thing in a lot of these current hard to do you think about we? We see it all these companies in Silicon Valley. Well, we see it when we do the podcast we had a moment and
SPEAKER_04: We were discussing the don't say gay slash parents choice Bill which you look at the framing of that. It's completely Hilarious that like we framed it as 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 like really is that what we're talking about here and we looked at it and a couple of besties were having a conversation I won't say who and we were trying to get educated on it and I'm like should People be able to talk about their gay parents in first grade second grade third grade. Of course, you're a parent you're gay I'm assuming you don't want people to be able to tell you you can't be talked about at school and then it was like and Gender assignment and what gender you choose and now we're sitting there going 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 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 we're we were like, is this a discussion we can have on the podcast? Without us actually consulting with some people who know more than us and discussing it and I've written about three or four tweets about the the trans swimmer and I have feelings on it But I'm like should I actually tweet that I find it's profoundly unfair that this person gets to win every single Women's meet and I kind of feel bad for the women who now can the best they can do a second place is am I Gonna get canceled for that because that was my initial response to it and I don't actually know my position because I don't know that other person story who's a trans woman and Maybe she does deserve to be in that. I don't know if anybody has an answer for that. So I'm curious You know from the besties themselves, you know, what are your thoughts on? Our tackling some of those things and and not getting canceled or the blowback these things happen on every dimension every day
SPEAKER_07: Which is you have more questions and answers. I think Tim you wrote it in the slide It's kind of like you're navigating between high conviction and you know high knowledge 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 out Where you are today, you can figure out where you could be tomorrow That's what's not allowed anymore right 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 gets people very afraid and then when you are afraid I think to your point what happens is you take the most simplest productive point of view that can be the most Acceptable on any topic whatever and this is what causes this snowball I literally am scared to talk about the trans issue because I feel like I don't know enough
SPEAKER_04: I also don't want to hurt 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 social costs of even taking the risk of having that
SPEAKER_02: Conversation outweigh any potential benefit. It's just the conversation gets so hot But I want to I want to go back to what Tim said that the moment of truth is when the leader of the organization Has the choice of whether to fire the person who the mobs going after it seems self-evident that the leader shouldn't basically join the mob and Inflict mob justice on this poor employee, but they do anyway and the 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 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 Armstrong implemented his policy of no politics the workplace at coinbase who then retaliated against him He got a New York Times at peace That was they are the enforcement wing of the woke mob when Elon said that he would restore free speech to Twitter What was the response the New York Times wrote an article basically trying to? Identify him with the apartheid regime in South Africa Even though he's a kid the headline of the article didn't even match up With the body of the article the body of the article had my stories about him as a child It was also a historical account of you know, a bunch of oppressive things that happened in South Africa
SPEAKER_07: And in it when he was a child, right? He was the body of the story had nothing been anecdotes about how he even as a young
SPEAKER_02: adolescent Basically rejected apartheid and yet the headline the story was basically painting him with this brush So basically calling him a racist no and and it came from his dad and they have a super complicated
SPEAKER_07: 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 Errol's mouth and it was still so supportive of you Yeah, right. So we're gonna overcome this problem. I think we have to have this recognition
SPEAKER_02: that You know that these? Prestige outlets like the New York Times who for some reason have so much credibility in our culture They have the power or they used to have the power to basically destroy people's careers We have to realize that these are just Places that have been hijacked by radicals and like their stories are meaningless. They're completely biased We have to stop investing them with the cultural power To like destroy people it's that simple happens is there's a lag time now do Fox News
SPEAKER_05: They don't here's the difference
SPEAKER_02: They don't have the cultural power to destroy anyone and who have they destroy name somebody like what woke mom if they engineered? Mike the pillow guy
SPEAKER_05: I'm not saying they wouldn't if they could I'm just saying that they can't because they don't have that kind of cultural power
SPEAKER_04: Before we Tim you were gonna say something I was gonna say when an institution like this gets what happens is a mob like this that they don't build anything
SPEAKER_05: You know, they don't create what they do is they appropriate they hijack Something they take its existing good reputation, which is real power, which is a lot of power and they spend it down It's not constructive. It's destructive. Yeah Yes, but they'll actually go and like it's like they like they take over and they and they spend the reputation down 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 know a lot I'm scared about what's going on in like Ivy League institutions I think have so much credibility, but a lot of really bad things have kind of happened there and it's yeah Can I suggest we pivot to tech and investing while we got Keith here?
SPEAKER_06: Because 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 your latest fund five billion five billion dollar latest fund And you haven't made any investments and you know, the fund as a whole has made some investments
SPEAKER_01: I haven't let any you have it. Yeah, I haven't let any new investment point like two. Yeah last year I'd led the 13 or 14 in a year So to go to go to the effectively zero for half the year is like me being on vacation Can you tell us what your point of view is? Well, I mean I tweeted in October but you know that we were at the height of the market I tweeted last January that we're gonna see two thousand all over again. And so privately internally I've been arguing this internally that this is exactly what's gonna happen And so, you know, my behavior should reflect my views I believe in some consistency and 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 money and invest in companies that aren't gonna make me Money, my job is to ultimately return billions of dollars to my LPS And if I can't do that, I shouldn't be giving anybody any money. So when do you change your mind? Well, there are founders who are ahead of the curve. 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 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 interestingly enough about 1.5 million dollar investments Where the founder walked in and said, you know, I don't need a lot of money. I could accomplish a lot I can achieve it inflection moments for a very small amount of capital That was 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 think about where the you know Nasdaq's going and so the last three or four investments were all incredibly disciplined founders That I made like late last year into arguably into January now we have doubled down just to be clear about our conversation We have doubled down in portfolio companies where we've led new rounds, but as far as a new investment from scratch I haven't made any new ones this year when you double down in a moment like this. How do you set valuation?
SPEAKER_07: Especially if the last valuation was maybe Felt like a top tick. I think the founder has sort of digested where the world is then, you know
SPEAKER_01: We have a dialogue my valuation. Otherwise, I 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? Well if they have a fair market valuation from top to your firms We'll try to be like in that zone But they'll often go to the market and people will be like either pass pass pass pass pass or they will give them You know just reality and then we'll match that but we've done that a few times where we've encouraged founders Typically, we wouldn't do this because my partner Brian singer man loves to 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 will lead the next round and leave the next round. We've done this with ramp For example, we've like three or four rounds But now with a valuation reset going on it's been easier sometimes with founders I really like to say why don't you go talk to five people? Well, it's just like go talk to five 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 feedback, you know Not just have to rely upon my judgment car Are we at the point in the cycle where the down rounds the warrants?
SPEAKER_04: the the liquidation preferences have Happened or are starting to be discussed. Definitely seen a lot of lick preferences again
SPEAKER_01: Explain what it is and why that's important. Yeah, so like liquidation preference basically means that the
SPEAKER_01: Investor is going to get their money back first Regardless of what happens in the world and that nobody who's a shareholder Nobody's a founder is gonna get it. Nobody is a common shareholder, which basically means founder employee is gonna get any money until The investor gets all their money back times some multiple and that multiple is based on time and or just a hurdle It's very scary But it can be arbitrage by success founder sometimes can arbitrage it Well, 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 can be a decent gamble. I've seen someone like Jack Dorsey at Square did this very sophisticated CEO and he knew what he was doing and knew why he was doing it and it's worked out pretty well actually But it's if you're playing a lot of fire So it's not for everybody and you should get a lot of feedback and advice before The flat rounds are definitely happening The new flat is the up round kind of philosophy even in some of our better for those senior like prefer
SPEAKER_06: It depends
SPEAKER_01: been on the round They're all over the map actually the market hasn't shifted to the point that every new money coming in senior to all other money
SPEAKER_06: That's how much leverage and what quality investors have on your cap table
SPEAKER_01: Like so for example, someone tries to put a senior preference on top of my capital I'm gonna yell at them a lot and if they ever want a new investment that were you know, it's from our fund They may not want to do that. Yeah, I think that we're a
SPEAKER_07: Couple turns away. It's for the godfather the discount rounds Well, some companies are gonna have to try the problem is like for example, we don't like to do those rounds
SPEAKER_01: There's so much brain damage in the politics of that with founders with prior investors walk us through that
SPEAKER_07: Why tell us about that brain? So typically if a found you think there's an efficient market of pricing, right?
SPEAKER_01: like I need this much capital and the markets gonna float with the price of that capital is in Private capital. It's not really true like so if someone comes to me and says, you know, my last round was done at 300 million, you know, Nine months ago and today it probably get priced at let's say 120 million I'm more likely to say no than to give them an offer at 120 because I know their prior investors and their prior employees are gonna get be mad at me and furious at me and I don't want a lot of Founders and people annoyed at me 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 whether 80 100 120 140 is the appropriate price which is very bad for the company in some ways because you They might need the capital start them of money
SPEAKER_07: Yeah, no, they may be able to find somebody else
SPEAKER_01: But we typically a founders fund really don't like to do those rounds The only way we would consider it is pretty much of everybody on the cap table called us up the founder of CEO the board members prior investor said we really want you to do this and like we're all collectively holding hands and want you to do this Then we seriously consider it Do you at the end of q1?
SPEAKER_07: Do you guys sit around and reset valuations and marks before you tell your LPS what these companies are worth meaning? Your own sense when you sort of generate a sense of valuations like yeah, we do mark down actively mark We do proactively mark down
SPEAKER_02: What's your methodology for that? Peters views We'd be open to doing that if we felt like we had an objective methodology for doing it's very tricky
SPEAKER_01: I think you can if you it later stage ones a little bit easier because you can apply multiples There's public comp, you know public comps and you just adjust to that. I think the earlier stage stuff very difficult to do objectively It's also not that set You're probably not as sensitive to it in terms of what it move how it moves the needle But the growth stuff we try to use public comps and be like realistic
SPEAKER_07: What do you think about let's just we'll just throw out some firms just if you had to guess The next 18 months for some of these folks Softbank vision fund one I mean, you know my views on something can been obvious since I did New York Times on all things interview
SPEAKER_01: 2016 you should reread the transcript but I was like that strategy just does not work Powering money into companies and hoping that money is the key asset in a key ingredient for success has been false and in the history of Technology for 50 years and said that you know, they lost 27 billion dollars again the brand subprime They used to do well in Latin America, but they got rid of the person who actually knew what he's doing So this is a catastrophic mess. Plus it has moral issues You know less moral issues than before but still, you know, not not the best investor tiger. I
SPEAKER_01: Think they have a skill set gap if they're gonna try it from what I read publicly They're trying to invest in series a and series B companies the skill to be successful at investing series a and series B Companies is very different than leading growth rounds or 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 billion in a growth fund Of 3.2 billion and we have part the investment team is basically the same most of the investment team Maybe all the investment team is better at one or the other and if tiger thinks that they're gonna 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 series a investors It is a very different discipline than deploying capital writ large. Yeah, Sequoia
SPEAKER_07: I think you know Sequoia is the best one fund historically
SPEAKER_01: They are really good at what they do. Obviously the world is changing around them Like I think like many people crypto, you know, it's kind of throwing the little monkey wrench in their model They have to scale that explain that what do you mean? They missed the first wave of crypto and crypto, you know
SPEAKER_01: Has returned to these amount of money for people and so I think that's tarnished the brand a bit with crypto people Specifically, but they're working on fixing that they have a really good team The team is aging still pretty well. One of the hardest things in venture is you age non gracefully in this job You know by the time you're my age You're probably too you're already past your prime and you know I kind of compare it because I went to law school with people who are US senators and I had breakfast in Miami with one of the more prominent US senators and I said I'm basically getting to the tail end of my career in tech and he said I'm in the bottom 20% of the youngest 20% in the US Senate and says a big contrast But anyway, I think I think they're actually led to what they do or boy for Senate. Sorry for boy for Senate
SPEAKER_06: You might run for Senate. Oh, I'm not ready for Senate. No, maybe my husband second career
SPEAKER_01: Take the politics and reason in crypto. They're excellent
SPEAKER_04: I want to take the other side of the crypto missing the last crypto insanity if this thing does all get torched as it seems to be and Nobody shipping actual products that touch customers that actually solve problems in the world sitting out You know that crazy frenetic moment might actually look astute because you know some of these projects I Do not see them shipping product. I think that you're saying something that's practically true
SPEAKER_07: But I think Keith is also saying something that is practically true, which is if you're a fund That has that crypto deal flow at least my understanding of that playbook is you see the project You make sure that you get some amount of the float of tokens You're allowed to monetize those tokens very quickly. And 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 Keith is saying and this is where it's a quay I may have made an excellent decision Which is that form of money making is not very reliable And I think that there's gonna be a lot of questions about that once there's a regulatory framework. Yes, and it might turn
SPEAKER_04: Three points mostly I agree with that
SPEAKER_01: 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 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 in that hedge fund mode So tokens without successful products and iconic companies aren't interesting to me Even if they're turn capital we did think at Founders Fund though that all the alpha was in Bitcoin So going back a decade not me But my 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. 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 founder It's worth us investing the wrong founder It's not and so there are crypto projects in crypto companies where the founder is extraordinary And we would love to be the primary investor if we can and then there's a bunch of other companies that might be successful But that's not our business We are in the end of one find the next Eli is awesome Isn't the fundamental problem that a lot of the way these crypto?
SPEAKER_04: Projects are designed is that you don't have protective provisions preferred shares and the operating system that venture runs on out of it Okay nothing And they're asking you to give them a donation of a hundred million dollars for a token that has some panamanian Foundation and you don't have a board seat I mean this seems incredibly high risk and undisciplined They are they are high risk, but we're in the business of high risk in some ways like the protective provisions
SPEAKER_01: I think we don't really care that much about them at founders fund is one of the theses that you know Peter started the fund with which is these terms are way overrated That ultimately the companies that succeed or the really the Facebook's the Palantir's the other SpaceX's That's where you make your money in this business is worrying about what goes wrong Those companies have boards. They do have boards and I actually believe in boards But I believe in boards as being a mentor or consigliere not in governance. Of course. Okay, great, but you're not buying
SPEAKER_04: Chuckie cheese like I never give a term sheet
SPEAKER_01: I never give a term sheet that has a board provision for me The founders requires me to join the board got it
SPEAKER_04: But I mean the tokens are I think are part of the problem that I can't get my head around Yes, the issue with tokens a little more structural of when you have liquidity prior to success
SPEAKER_01: That's not necessarily a good incentive Like I think success liquidity should follow success with product follow with users follow attraction not be in advance I think that's just those teams when they get flush with a billion dollars in tokens or a hundred million in tokens
SPEAKER_04: They wind down the problem. They haven't shipped the product. Yeah, it has misaligned misaligned or bad or perverse incentives all over
SPEAKER_07: Talk about you you're mentioning in the back In a moment like this the people that it's hardest for right after the entrepreneur is you said the junior partners at these organizations? Just describe the dynamic now of having to run an organization where you're trying to tell people just go to the beach for a year Yeah, I mean, I think look the way you make sure the way you become successful adventure
SPEAKER_01: Is you give money to a founder who turns it into an iconic company? That is how you get promoted I think that's that's the job. And so if 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? 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 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 investments Semmel Shaw has a good blog post about this your portfolio is your career once you make five or ten investments in venture if Those aren't good. You're never gonna get great I don't know There's a single example of like a VC who became successful where the first five or seven exactly didn't show some signs of brilliance It's literally the story of the people on the stage right now
SPEAKER_04: Is that we either got lucky or we were good or some combination of the early investments actually hitting? I'm definitely worse like my first five investments three of them became public companies and so
SPEAKER_01: 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
SPEAKER_04: I think I do think there's some luck to it or maybe your network network
SPEAKER_01: So for me it was easy because these were people that we worked David and I worked with at PayPal I was there and I was smart enough to at least you know Follow the people that were launching companies after PayPal and give them some money So I didn't have to know much about venture other than just follow my former colleagues. We have to wrap and go to lunch
SPEAKER_04: We're gonna end with sacks telling us His most illustrative and funny story about Keith for a boy. Oh my god from Stanford
SPEAKER_04: You're so many good words some great moment with Keith. I
SPEAKER_02: Don't know
SPEAKER_04: The two of you this is you could you could feel the friendship and all the memories coming through for sacks right now All these great I could flip it Keith and maybe some sacks
SPEAKER_02: I like the work that Keith and I did at PayPal better, I guess. Yeah Okay, fine, whatever Stanford PayPal give us them give us the moment. What do you think the best stories?
SPEAKER_02: Well, one good one that I think is instructive is you know, like I was kind of this opinionated person running around all the time
SPEAKER_01: probably half right half wrong and David was basically running the company at the time and I could occasionally sabotage some projects and David had a really good way of reframing and channeling my energy Which I think is applicable to most 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 and not to other people and then you would like filter it It's like if you were like if it's right, I'll act on it And if not, you know, etcetera, I'll debate it with you, but it was actually constructive for the organization. So I felt liberalized liberal liberalized to basically give the feedback and try to you know Edit our course and it would be channeled in use useful, but it wasn't distracting people And so I think that is something like a lesson I've taken with me that I actually now uses a CEO I heard I this is what's so crazy about this. I've heard this exact story from Reid Hoffman. Tell me that about you
SPEAKER_07: I think it was either it was either PayPal or at LinkedIn where you would Know and it was just like lighting everybody and everything on fire I read the emails and I'm like shit. I can't write that well anymore. Let's give it up
SPEAKER_02: Oh
SPEAKER_04: Mirches are
