Hey, everybody, welcome to another episode of the all in

podcast, your favorite podcast. And a lot of a lot of topics on

the docket, including, well, we’ll get to that in a minute.

Tons of stuff to talk about not just politics, but a lot of tech

news. You do sound really hung over today. J. Cal, you sound

like an old man that’s been smoking cigarettes for three

weeks. You sound wrecked. How big was your night last night?

Admit it. I didn’t go that big. On a scale of one to Charlie

Sheen, it was like a six. There’s like a Martin Sheen in

his 30s. What does that mean? One to Charlie? We had a couple

of beverages. I’m sorry, on a scale of one to Charlie Sheen.

I don’t think I’ve ever been past the one in my life. So what

is a six? A six is like, you know, Paris Hilton, you know,

in her heyday, or like Lindsay Lohan in Hollywood in the 90s.

It’s like, you know, like a good time, but not crazy. Mm hmm.

Didn’t they have to go to rehab?

Yeah, exactly. I’m super high functioning. Let me tell you

something. Charlie Sheen cannot. Oh, it was just like Lindsay

Lohan. Wait, Lindsay Lohan, the one who went to rehab like five

times. Like what are you talking about? Yeah, that’s a

six.

I don’t want to know what seven is.

Joining us, of course, the queen of quinoa is here. The

thriller from the Milla Valley. He puts the eye in anxiety. He

got his degree from his Google pedigree, the Sultan of Science,

David Freeberg with us again.

All right, next up, of course, is czar of ARR. He perfected the

flywheel with his boy Peter Thiel. LPs, don’t be nervous

because he’s only investing in software as a service. The

world’s biggest asshole, the Rain Man himself, David Sachs.

He’s a sasshole. Wait, you call me a sasshole? A sasshole. That

might stick. I don’t know. I feel like this might be heading

towards kind of like a high school talent show kind of

episode. But yeah, go ahead.

And finally, the king of SPACs himself, the guru of growth. He

puts the dick in dictator. He’s going to upset her with his

sweater. Jamath Palihapitiya. All right, boys. I’m just letting

the audience know I can’t keep this up every week.

Yes, yes. It’s become a very anticipated new feature of the

show.

It is. It’s a new feature. But you know, I forgot we had like

wet your beak and, you know, all this stuff and all these-

It ebbs and flows. We come up with new things.

It ebbs and flows. We come up with new things. All right,

listen, just a quick programming update. All In Summit sold out,

basically. It’s going to be a great show. We got about a

dozen speakers lined up, all kinds of great folks. And three

great parties I want to highlight. Monday, Sunday night

will be the poker tournament. That’s going to be our

Goodfellas, Godfather kind of theme, dressed to impress the

family. Night number two, Monday night, is going to be our

Havana White Party. Wear your best linens and whites. And then

closing night party on Tuesday night is going to be our Miami

Vice Big 80s party. Neon and t-shirts under suits. It’s

going to be a hell of a party.

2,999,700 people don’t give a shit about what you’re talking

about right now. There’s like maybe 300 people that are going

to go to this party that you’re throwing and they’re enjoying

it. 700 tickets, I think there’s gonna be 700 tickets

issued and there’ll be probably 400 people at the party. So

they were pretty good parties.

We’re in the party business here at the All In pod.

Well, I mean, the world needs some good parties. In my

opinion, it’s gonna be three back to back great parties. And

the theme of the conference is the problem I most want to solve

in the world or the problem I most want to see solved in the

world. So we’re asking every speaker to think about that. And

we’re going to kind of talk about the world’s biggest

problems and then who actually wants to solve them.

The world needs more parties.

Well, that’s that’s what I’m doing. That’s my that’s going to

be my 10 minute talk. My TED talk.

I’ve been I’ve been watching the WeWork show. Have you guys

been watching it on Apple TV plus? Yeah, it’s great. Elevating

the world’s Jared Leto is so freaking good in as that

character, by the way. Yeah, it’s incredible. He got to get

an Emmy like elevating the world’s consciousness as the

mission and then just throw parties is the way to do it.

I feel like you’re you really get that vibe like yeah, it’s

aspirational. You could elevate the world’s consciousness with

your with your summits. I told Bill pocketing millions of

dollars. It’s not going to make a profit. Whatever profit it

makes is going to go to Chamath Star Chamber 50 person

conference he’s doing with the all in brand. So everybody

gets to leverage the brand. Yeah, first you did it sacks

with your call in. Now I’m doing it with the summit. Chamath’s

going to do what his think tank and I’m not going to do it.

Coming soon from Friedberg, the all in Munich special lose

weight like your besties. He’s going to the it’s it’s it’s the

all in brand that allows you to lose weight in the following

way. He brings his best vegan chef to you. Oh yeah. He spins

up some **** Tempe garbage. Tempe and and vegan shakes. Your

favorite Chamath. It’s double **** yuck. Right. Yes. You

vomit after you eat it. You’re you’re in a caloric deficit for

the month that that person refuses to leave your house.

Boom. You lose weight. Everything’s solved. You lose

weight. They’re like, hey, want some quinoa? You’re like, no.

And then you lose weight. No. That’s pretty. Give me. Give me

my olive infused beef. Please. The olive infused beef. No, I’m

sorry. Not olive infused. Olive fat. These beef only ate

olives, guys. Right. And then we murder them and ate them. You

know, you know, you guys are like, you’re going to have a

great life. Yeah. You guys need you guys need to elevate your

consciousness, okay? And have a party. Let’s go. We need to get

some morels and some chickens and make some. Yesterday, we

had morels. Sean made morels. White asparagus with morels for

you. Mm. Mm. So good. So good. The morel season has started.

Everybody enjoy it. Lots of different news this week. You

guys appeal. You guys appeal to the common man. The morel

season has started. Morels aren’t that expensive. Tempe is

more expensive than both quinoa and morels. 100%. That vegan

**** is way more expensive than normal people. Alright, listen.

Uh we have to elevate the world’s consumption of steak

and meats. Um I think a good place to start is we’ve been

talking. By the way, by the way, have you guys ever looked

at on the back of any carton of oat milk? How much chemical

nonsense is in that stuff? Yeah. Can that really be, can

that really be good for you? No. You know what I want? Oh my

god. Give me. Where’s the, where’s the oat milk that’s just

oats and water? Doesn’t exist. It doesn’t exist. It’s like soy

lexithin, xanthan gum, like is that stuff can’t be good for

you? You know, Saks drinks and a twelve ounce glass of milk

with every dinner. They just drinks it. By the way, the

almond, the almond milk at like the Whole Foods riddled with

sugar and all this other nonsensical chemicals as well.

Man, I mean, I mean, people trash milk, I get it but like

uh and as if you’re lactose intolerant, I understand you’re

in a pinch but why go to an alternative milk that is just

riddled with just all of this terrible, terrible stuff? You

know, Saks used to love to eat breeches so much that whenever

we’d have a party, somebody would bring the blocks with the

with the with the wheel of brie. He would literally eat an

entire brie wheel on brown sugar. No, they would put the

brown sugar on top. They would belt it and Saks, Freebrook,

Saks is eating an entire brick of brie in front of us. Oh my

lord. What was the origin of your brie obsession, Saks?

Stanford. I’ve been to Stanford. You just at some point

became a francophile. Yeah. The last guy I would think that

would eat brie. What’s the matter? You just don’t have, I

mean, what about cheddar? A great American cheese? No, you

just prefer the French, huh? Yeah, you know. You still got

that fetish for I gotta go. Yeah, we got shit to do. I got

45 minutes. Saks, Saks, is that fermented kombucha? Stop. Stop.

This is just plain iced tea. Sometimes it’s just good to be

normal. Oh, oh, you’re back on trying to catch up? Trying to

catch up? Okay, here we go. Listen, we’ve been talking a

little bit about the contraction in tech, the growth

stocks having their multiples lowered, and we knew this was

coming, but it’s been a horrible week for large companies

starting the layoffs. We knew this was coming. We predicted

it probably six months ago. Fast.com is a one-click checkout

startup. Fast.co, they announced they’re shutting down on

Tuesday, this after the company grew to 450 employees and

generated reported $600,000 in revenue. I think that their

employees could have made more money if they did one door dash

a day delivery. At its peak, Fast was burning $10 million a

month according to reports. I think the information got most

of this information while only generating about 50k a month in

revenue. Their $102 million Series B was led by Stripe in

January of 2021. Company raised $124 million in total. Also

better.com, which we talked about, you remember, they had

their horrific, cringeworthy founder lay off a bunch of

employees over zoom. And they laid off 900 people December

1 3000 people on March 8, according to TechCrunch. For the

5000 remaining employees on April 5, better.com offer

corporate and product design and engineering employees the

opportunity to voluntarily resign in exchange for 60 days

paid severance and health insurance coverage. Better CEOs

Vishal Garg, hopefully I’m not correct noted the uncertain

mortgage market conditions of the last couple of weeks have

created an exceedingly challenging operating

environment for many companies in our industry. And then going

to go puff, which, you know, I had the founder on this week at

startups, and he’s a pretty good, you know, like pretty

realistic about the margins in that business. They’re making a

modest cut of 3% of their 15,000 staff seems like a

reasonable thing to do, given how the market has changed. But

again, their valuation was absurd. 1.5 billion at 40 at a

$40 billion valuation in December. Chamathi predicted a

lot of this, and that people would have to sharpen their

pencils. We had a discussion about this, you know, the good

times are our IP. What’s your take? Is this the the beginning

of the end? The middle? Where are we at in the cycle? And

what’s the reasonable thing for founders to do here?

I think so we probably should take the the macro and then

boil it down to the startup. So at the at the macro level, I

think that we’re playing a very dangerous game of chicken with

the Fed. And you can kind of summarize it in the following

way, which is that, you know, three or four months ago, we

only thought that there was going to be a handful of

interest rate increases. And increasingly, what has happened

the market has remained so resilient, that the Fed is sort

of put out more and more data as the data has justified them

being a lot more aggressive. And it kind of crescendoed this

past week, where they basically said, Listen, you know, we’re

going to move by 50 basis point increments for the foreseeable

two or three rate hikes, and we’re going to start

quantitative tightening. What does that mean? That means that

instead of basically printing money and coming in and buying

securities from the market, right? So what happens when they

enter the market with money that they literally do print, and buy

your bonds, they’re giving you cash in return. And typically

what that has led to is the inflation of all assets, right?

equity assets have gone up, bond assets have gone up, because

there’s just nothing else to buy. When quantitative

tightening happens, they reverse that. And what they’re going to

do is about $95 billion a month of the opposite action, which

means they’re taking money out of the system, right? Or in this

case, what they’re going to do is they’re going to let a bunch

of maturities roll off and not rot, not renew them. Okay, so

why is this important? Well, it’s important because, you

know, we’re still 4% from the highs. So we have 7% inflation,

we have all this crazy stuff happening, we have a war, you

know, going on, we have massive price issues, we have supply

demand issues, and the market keeps shaking it off. So I think

what the Fed is going to do is get even more aggressive, you’re

going to probably see, you know, a lot of 50s, maybe even a 75

point hike, you probably are going to see them, you know,

even ratchet up quantitative tightening, until there is a bit

of a bloodletting in the equity market. They need to see that

the markets crack.

And so they literally need to see what percentage drawdown or

just to go sideways, what do they need to see in order to

or is it inflation coming down a couple of points?

Well, the problem that we suffer from is that they’re going to

look at the highest level indexes, right? They’re not

looking at single stocks. And so when they like when you and I

think this market is down 4%, we don’t feel that because some of

our companies are down 50 and 60%. Right. But that’s because

we’re all focused on high tech growth. But they look at the

broad indices and the broad indices have held up really

well. And mostly, it’s because you know, if you look inside the

S&P 500 40% of every dollar is, you know, Apple, Amazon, you

know, Microsoft, etc, Tesla. So we’re in a situation where I

think until the Fed see that there’s a massive trading of

liquidity, which means like you see these indices crack big time

35 3600 in the S&P, they’re just going to keep ratcheting things

up. As it comes all the way down to our companies in Silicon

Valley and tech. What that means is like you have to start

planning for the worst. And I think the worst means that

there’s an 18 month period where you cannot raise money

on your terms, you have to raise money on the market terms. And

so if you’re not in a position to show good growth over these

next two years, I would encourage you to just get your

balance sheet in order to wait it out.

Saks nuclear winner is a possibility here markets for

startups. Raising money, again, a strong saying could be on the

terms of the capital allocators. What what’s your advice to

founders? What are you seeing in the boardrooms that you’re on

the board of? And if you were running one of these high growth

companies for the past year, what are the first two or three

things you do?

I mean, the first thing you got to do is look at your burn

multiple. I mean, how much are you burning relative to how

much incremental error are you generating, you look at fast,

they raised 120 million, what, like a year ago, that they’re

out of money now. So they burnt 10 million months, like you

said, here’s the crazy thing. If they just slammed on the

brakes three or four months ago, when we were talking on the

spot about the coming downturn, they could still have $30

million in the bank, that’s a lot of money. The only reason

it doesn’t seem like a lot of money is because they’ve been

burning 100 million over the past year. But objectively $30

million is a gross series B, which is actually a lot of money

for a company that only has 100,000 in revenue. So they

could have saved that company if they had slammed on the brakes

three months ago, and rationalize the cost structure,

and they did it. So they hit the wall at 100 miles an hour

who’s responsible when something like that happens, David,

because you we’ve all seen it. What is the suspension of

disbelief that creates this kind of stupidity?

That I mean, that’s what it is. I mean, you’ve got you’ve got

people who are kind of drinking the Kool Aid and there’s nobody

advising them to stop or if there is they’re not listening.

I mean, look, PayPal had this situation back in 2000, the

year 2000. Right after the.com crash, we were burning $10

million a month like fast, we had no revenue and no business

model. Okay, we had said that the service would be always

free. We had four months basically of life, and we

pulled up on the throttle. And what we did is we basically

introduced paid accounts, we started charging transaction

fees, and we cut the cost structure of the company. And

we made that last $40 million last a lot longer than four

months. It lasted until we could then do another fundraise

the following year. And we were able to then raise with good

numbers, real revenue, a business model, etc. So, you

know, and that was because we were just paying attention to

the changing environment, the world had changed from sort of

the pre.com crash, you know, 1999, your business model

didn’t matter, your margins didn’t matter, revenue didn’t

matter, none of that stuff mattered. All that mattered was

growth. But by, you know, mid 2000, everything had changed. So

you have to be attuned to what the fundraising environment is

looking like. And if you’re a high burn company right now,

that’s not generating a lot of revenue to go along with it,

you better slam on the brakes and rationalize your cost

structure before it’s too late.

David, tell me like, what do you think is going on in this

board meeting? I mean, like, this is a group of incompetent

incompetence.

I don’t even know who’s on the board, because Stripe led two

rounds, I think. And so

is that part of it, David, that you and listen, we all love

Stripe. It’s a great company. It’s a legendary company. But

one of the reasons we don’t like to have strategics is maybe

they’re not thinking the same as a proper capital allocator.

And for them, this is peanuts.

Right, exactly. No, look, the reason why a strategic investor,

I think the reason why a strategic investor invests is

because it’s strategic for them. I mean, it was in stripes

interest to try and back a winner in the whole e commerce

checkout line, sort of payment space. And so they did that. And

I don’t even know if they had a board seat. And so no one was

really

but I don’t I don’t understand that strategic decision, because

I suspect the rationale somewhere internally, and in

Stripe, which is pretty flawed is, hey, we can’t do it

ourselves. Because if we did, we will be competing with our

customers. But picking a winner and putting $120 million is

tantamount to the same thing. So I don’t understand.

I mean, it doesn’t make any sense, right? And Stripe raised

money at what $9500 billion valuation. So look, it all flows

down from, you know, the frothiness at the peak.

No, I’m saying I think I would have, it would have been much

more credible for Stripe to say this is a critical piece of the

infrastructure and value chain and payments that we want to

own. So we’re just going to go and put some of our better

engineers as like a, you know, side project and see if we can

tack away at something that works. I mean, I think a lot of

people would have adopted it.

But I guess there was a clear stripe was on the board index

was okay. Okay, that’s interesting. I mean, those are

some good investors. There’s, there’s a couple of people on

the board index and who else,

according to crunchbase stripe was on the board, a business

development person from their index was on the board. And Dom

the founder, and looks like Brian sugar, who I know, who’s

an angel investor and a founder. But who knows if that’s outdated

information in crunchbase.

Remember when Philip Kaplan used to run a website called fucked

company?

Absolutely. A friend of mine. Yeah.

Do you want to tell the fuck company story? Jake out for all

the people that have no, I mean,

basically, what happened was.com, the.com world was

imploding, all the employees didn’t have a voice, there was

no social media at the time, there was no blogs at the time.

The only thing you could really publish on the in the world was

like a geocities page, you could put up a homepage, if you knew

how to do HTML is even pre my space. And so a friend of mine,

Phil Kaplan, who does a very successful company called

distro kid now started fuck company. And it was a message

board. And what he basically let people do was, he would write

three headlines, one sentence each kind of like before Reddit

existed, where you just put a one line hit, and then there

was comments underneath them, they’d say, this company, we

just got an email, this company’s laying off people, and

he would beat all the news stories to the layoffs, because

he would just run with any email that came in. And then

people would detail and savage the management of those

companies underneath that for malfeasance and explain exactly

how ridiculous the spending was in that era where people were

burning money like drunken sellers.

I think this time around, it’s probably important for

employees to understand a couple things. One is like, who

doesn’t know what they’re doing, right? So like companies

that are making layoffs, those are those are happening, they

shouldn’t get punished for that. But you got to think like

the fiduciaries that are ripping this money. And I mean, do you

really want to be the person that goes to work at a company

that’s backed by these folks in round two? I mean, that’s not a

signal like, like the opposite is always been a signal, right?

Meaning when Mike Moritz makes an investment, we all pay

attention. Because we all think, wow, there’s a picker, you

know. And he did that with Stripe. And with so many other,

you know, great companies. And so the likelihood of an employee

wanting to work for a Mike Moritz backed company or Mike

Moritz governed company is very high, right? Same thing with

Gurley’s, you know, same thing with a lot of a lot of really,

really good investors, john door. But the opposite should

also be true, then, because if it if you really want to work

for a Peter Thiel back company, you should probably not work for

one of these companies, where these folks were just completely

absent are also governing the board. Because that just means

like nobody knows what’s going on.

We haven’t had proper governance for a long time in

Silicon Valley. So I mean, I think that’s what we’re weak, we

crashed, we crashed and the dropout were, in some ways about

incompetent boards, both of those TV shows.

No, I mean, I definitely see this. You know, I think you guys

know the the incentive for a traditional venture capitalist

that that that maybe isn’t, you know, motivated by improving

their craft. But they’re motivated, you know,

incentivized primarily by making money is to raise more

capital and getting more deals. And as you guys know, like every

venture firm has maybe one or two superstars. And then they

fill out the ranks and hire a bunch of folks who are maybe not

superstars. Or they don’t pay as much attention, you know, it

used to be maybe a VC would sit on a handful of boards. And now

it’s like you’re the board representative for 12 companies.

And that’s a, you know, you’re not going to be able to provide

quality time and service to and support to the CEO and the

company. And more importantly, as you guys point out, like not

provide good governance and governance isn’t just about are

you signing the docu signs as they come in to approve stuff.

But it’s about actually critiquing the business strategy

with the CEO at the board discussion, critiquing the

spending, reviewing the financial plan, making sure that

everyone’s aligned that this makes sense in this funding

environment to continue to do this work. And I don’t see that

a lot. I don’t know about you guys. But I see a lot of VCs

either handling to the CEO, because we have founder culture,

hysteria in Silicon Valley, where it’s true, the best

founders make 1000x returns, and that’s it. But that doesn’t

necessarily mean that the rest of the businesses should be left

to their own vices, just because there are a few ultra successful

founders that there are a lot of businesses that actually need

governance in order to achieve outcomes. And I see that lacking

heavily in Silicon Valley, because the VCs are more

incentivized to raise more money to make more investments

and then pay less attention and just go raise the next fund.

Well, I think I think you said the key thing. There are really

very few star pickers in our business. It takes decades to

really prove that out. And, and those people, but those people

that are real pickers, I don’t think put up with bullshit from

they’re not just pickers, like so john door was deeply involved

in Google in the early days, like, you’re right, I’m

simplifying our job. But what I’m saying is our job, okay, at

the end of the day is we’re picking, okay. And then once you

pick, you got to do the work. If you pick poorly, and you do

the same amount of work, it doesn’t matter. Nobody’s going

to remember you. Yeah, what ends what ends up happening is

the VC flushes the deal, because it’s not going to be the 100

bagger, they don’t pay as much attention, they let the thing

right into the sunset. And they’re moving on to the next

thing. But there is still a duty and a responsibility, I think,

to the shareholders and the employees of that company, to

you know, do what Saks mentioned, which is can you

reduce burn under these circumstances? And can you

actively engage as a board member to encourage leadership

to do that. And that doesn’t happen. You said the key thing,

there are few practitioners that really have the gravitas to

actually enforce those decisions. So, you know, there’s

a reason why in during the great financial crisis, there

was only one organization that even had the courage, forget

whether it was right or wrong at the time to even write the

RIP good times deck, right? It was Sequoia, nobody else dared

to even put that on a page, let alone give it to all of their

companies, knowing that it would leak less they’d be wrong. And

the reason Sequoia could do it is they’re looking at a 40 year

franchise and saying the integrity of our franchise is

at stake, we need to keep doing what we’ve done before. And what

it did, I think, in that case was pulled along a bunch of

folks that were not as good as the top few folks. And it helped

reorganize because if you see the three or four years after

that GFC deck, Sequoia flush that whole business, right?

There’s an entire turnover of that team. And so I think what

it speaks to is, and we talked about this in a few episodes

ago, if you’re seeking out AUM, you’re going to hire a very

different kind of person than if you’re helping trying to help

build companies. And the difference is that when you’re

trying to raise AUM, your customer is not the company,

it’s the customer is the LP. And what the LP wants to do is be

able to write their investment memo and not get fired. And the

way that you do that is by pointing to the team and saying,

well, this person worked at this company, this person was a VP

of that company. And it seems credible. But between but being

able to invest and being able to actually be a good operator

is so different.

Look, I’ll also say one thing that’s important, you know, I

don’t like this celebration, or sorry, the mockery and

entertainment that comes from failure, I, I thought fuck

company. Like I was young when it when it was out, and you

know, I would read it and kind of giggle at the stupid

companies that got funding. You know, but to me, it’s not like

the kind of thing that could should kind of be funny or

laughed at, or even to mock failed companies. I mean, it’s

cynical. I think the capital that’s available in the markets

today to support the building.

That wasn’t that that’s not what fuck company was. I don’t

think it was people taking potshots as much as there was a

lot of that. Oh, yeah, there was a lot of that. And because

yeah, there was a

thing to admit. But would you admit in fairness that there was

a lot of people telling the truth?

Oh, yeah, yeah, totally. No, no, but but but a lot of it was

like this mockery. Like, can you believe this shit even

existed? Yada, yada. And the cynicism, I think, you know,

kind of, you know, it’s it stales out the opportunity for

capital to support, you know, new new ventures, new

initiatives like this. You know, I also think that these

businesses that today are looking to raise capital that

are, you know, let’s call them good businesses, they have a

good opportunity, they’re going to be challenged in a

marketplace where everyone is cynical. And I’ll say, like,

scarcity breeds success, when there wasn’t a lot of venture

money. And there were only a, you know, kind of a few

investments that could be made each year, there was a

decision making process that says, you know, look, how

valuable could this be, versus this other opportunity that I

could invest my capital into that says, okay, the best

opportunity wins and gets picked and gets capital in a

world where everyone was raising a billion dollar second

fund, or a $3 billion fourth fund, and you suddenly had an

influx of $100 billion of venture money in a year. It’s a

lot like what we saw in crypto markets, which is an

extraordinary explosion and highly speculative bubble

assets. And a lot of these businesses maybe shouldn’t have

existed in the first place, too much demand for the stock of

private companies. And all the hedge funds that came into it

all the mutual funds, not enough supply of great founders and

serious teams that are working hard on this. I think with the

case of fast, I agree with your general sentiment about dunking.

In the case of fast, what you had was a founder who was on

Twitter every day, tweeting about how great the company

wasn’t giving startup advice, while he was taking none of it

and should not have been giving any of it because they didn’t

even have product market fit lesson learned, you know, you

know, you know, it should be criticized the next person that

backs that guy. You know, that guy, he’s got a very

interesting history, actually, as well. I think they didn’t do

any diligence on him. Apparently, he had two companies

that were kind of major red flags. And I think the

diligence issue sacks is one maybe you are having a similar

experience to be on the early stage. We were seeing deals last

year close in a week. We normally have 30 days to vet a

deal and maybe a week or two to get our diligence wrapped up.

Sometimes these things overlap, but it’s what was it, you know,

historically, a four to six week process, and then it went

down to a four to six day process. And then people were

meeting with you one day and saying they’re closed the next.

Were you did you feel like over the last couple years, people

were doing proper diligence or not? And what impacted

diligence have on any of this,

you know, certainly, I can’t speak to what our competitors

were doing. I don’t think our diligence process changed much,

we would just have a mentality of when there was a deal that

was urgent, we would drop everything and focus on that

deal and get our work done. And it can be done quickly. Although

it’s easier for SAS companies, because the metrics that you’re

looking at are so standardized. It’s just, it’s an easier

process. What’s the most important thing in diligence? In

your mind? What is the like, bullet that like people can’t

the silver bullet thing people can’t fake?

Probably offsheet customer references. So the first thing

we do is focus on the on the metrics, right? And the

financials, the SAS metrics, all that kind of stuff. But then

you want to talk to customers. And you want to understand the

value they’re getting out of the product. And ideally, they’re

offsheet customers.

Explain what offsheet just means that, you know, you

frequently ask a founder to give you customer references.

Those are onsheet references, the offsheet references are the

ones that you find yourself that they never gave you. So like

the easiest offsheet references to do are when your own

portfolio companies are using some other like piece of

software, and they tell you about it. So no, you know, it’s

a totally non conflicted situation. So that’s what

you’re looking for.

So one of your companies is using Stripe, they tell you how

great Stripe is, they tell you what’s good, what’s bad about

it. But right references you’re giving. So it’s sort of like

backdoor references. If somebody tells you here’s

Yeah, you can do the same thing on founders to you can have

onsheet and offsheet references for founders.

And you can do it for VCs.

Yeah, but but look, I think I think it’s probably a little bit

unfair to blame the board of this company too much. Because

the reality is that VCs don’t have the leverage or the power

in this business. I mean, it’s found this this whole

construction of the industry is set up around founders. And at

the end of the day, it’s up to the founder to run the company

and they get to do what they want. Unless they do something

criminal. Otherwise, they’re gonna be able to do whatever

they want. And I disagree. Hold on boards generally are very

deferential to founders. And if the founders not willing to

listen to advice, what are you going to do about that?

Well, that this is but this is the point you’re making, I think

is not right. You think that if Peter Thiel gave some advice to

slow the company down that this guy would have not taken it?

Of course, he would have. I don’t know. I don’t know about

that. And we would have to consider it. If Mike Moritz

actually said it, he would have had to consider it. I think what

you’re actually speaking to is in the hold on in the rush to

put so much money to work. We’ve elevated people who don’t

understand what the job is to do the job. And if they’re not

credible, of course, they’re going to be ignored. We all have

ignored stupid board members. You’ve done it too, David. But

even you know, let’s let’s actually look at Yammer as an

example. There were one or two of us that you would talk to

pretty consistently. You didn’t talk to all of them. I would

always seek out advice. Look at a great founder, a good founder

always seeks out advice, no question about it. But look,

this idea that it’s governance versus advice. I mean, the

problem with it being governance is all the institutional

incentives for VCs are to be profounder. So no one wants to

jam a founder by making them do something they don’t want to do.

Well, I’m just saying that’s that’s the way it is. No, to be

clear, that became a competitive tactic that emerged as more

venture capital funds were raised and more venture capital

was raised from LPs. Prior to that, there was a scarcity of

venture capital. And VCs could be could have good governance

and not have to have this whole profounder model that became the

thing that founders fund and Andreessen and others kind of

proclaimed as being core to their advantage and the reason

to pick them over some other VC who’s going to meddle in your

affairs. And by the way, both are true. There are most VCs as

Vinod has said publicly, add negative value. And I totally

agree with him on this, because they many VCs, particularly the

ones who aren’t, you know, valuable and don’t really have

much to add, try to add stuff, try to say stuff, and they just,

you know, create negative value in the process. But on the

other hand, the whole profounder model led to the we work and

ubers of the world that, you know, I think there’s a trade

off. I mean, look, I remember in the 1990s, the default was

that the founder just got replaced, right? Like, as soon

as the company successful, you hire a professional CEO, that

was just like rule of Eric Schmidt. I mean, even the

mighty Google did that. Yeah, no, I mean, that wasn’t that,

by the way, that was a point I was trying to make, which was

like, so much of john doors influence was in getting Larry

and Sergey to take Eric on as CEO. And I really do think that

that was like, you know, a critical move that created

probably the created most valuable company in history.

Right. And, you know, it’s, it was an important, imagine if you

had one of these founders fund. And by the way, you know, as you

guys know, I’m very close to the guys at founders fund. And

but imagine if you had a founders fund type approach,

where you said, Look, Larry and Sergey are the founders, they

know what they’re doing, let them do it, as opposed to the

john door nuance of, let’s make sure that we think about the

development of this company successfully over time. And then

convince Larry and Sergey through a bunch of meetings and

riding bikes and whatever else they did with Eric, you know,

to like, and then and then what about Jim Breyer? Didn’t he

bring Cheryl over to Facebook? I mean, like, there’s a lot of

these stories of the really, you know, the VCs that really

changed the trajectory of the business through their work,

right. And but look, all I’m saying is that the good VCs can

still have that influence, but it’s in the form of advice

rather than governance, right? Look, we just don’t call the

shots. You’re right. It’s it is it is advice. But But for

example, governance as an example, in every board that I

take, the first thing that I say is, here’s a template I want,

I’m not going to ask you a bunch of stuff, but I just want some

transparent reporting. And the first page is always how much

money at the beginning of the month? How much money did you

burn? You know, how much equity did we give out? How much is

left in the pool, simple, basic checks and balances, right?

Where you’re not asking all kinds of crazy questions. You’re

just like, all right, how much money are we burning? How much

dilution did we take? Now tell me what we’ve done. And those

are simple elements of governance way before you get

into a level setting, what’s the speed of the plane? What’s

what’s the elevation? Where are we at? What’s the altitude? And

when you ask people for this today, I should do that, too.

Yeah, I don’t know anyone that doesn’t do that. I’ll be honest,

like, yeah, anybody that doesn’t do it, honestly, is being

that’s not what we’re talking about. I don’t know anyone that

doesn’t do that. I mean, I’m talking about, I would love to

see, I would love to see a little bit of that going on.

There’s a lot to see a fast board deck and to see if that

first page is that page, the first page. And by the way, you

know where I learned that from, from Sequoia and Kleiner

Perkins. Because back in the day, what I saw from founders

was, oh, this is the first thing I have to report on. I was

taught by founders when I was a when I was a principal at

Mayfield. They’re like, this is how you do the job. And I was

like, great, thanks. I mean, I was, you know, sitting beside

these guys that were old hands at doing it. And that’s how I

learned this business through that apprenticeship. But there

was governance and advice. And the governance is just about

being transparent about how much money are you burning. And so

you can’t, you know, to David’s point, if you had just seen that

data, even if you take those board decks, by the way, because

you have these information rights, I don’t know about you

guys, but we do it, we did it as well. You take the board deck,

you circulate it to your other partners. There’s lots of times

where I see board decks and companies where one of my

partners are on the board, and I send them an email of like,

hey, here’s some bullet points of things to think about that

I’ve seen before, etc, etc. You don’t think nobody at Stripe or

index could have said, you’re burning $10 million a month, and

there’s no revenue. So the point is that data is only 30 or $40

million in the bank, give me a break, guys. So this was a

cataclysmic failure at the advice level and at the

governance level. And all I’m saying is, it’s a good lesson

for folks to learn. Absolutely.

Yeah, so many point people’s attention to articles I wrote

that I think are relevant. So first, we actually published an

article on the SAS board meeting deck that we’d like people to

use. And obviously, they’re free to use or not to Tomas point

right up at the top as a context center, we need to know,

what’s your monthly burn and how much money is in the bank.

And that and then we just divide those things to create runway,

we don’t like looking at projections runway.

Totally.

We just look at how much you burn last month, and how much

money you got in the bank, like, right, exactly. And when they

were down to 30 or $40 million, burning 10 million a month,

somebody should have like thrown up a red flag and said,

better slam on the brakes right now, because you’re gonna be

out of business in three or four months. So so that’s, that’s

sort of piece number one. The other piece was an archive wrote

a couple years ago called blitz fail, which is how not to go

off the rails because a lot. There’s a lot of literature out

there about blitz scaling. And a lot of startups think they need

to scale as rapidly as humanly possible. And I wrote this

piece about how fast growing companies that raise lots of

money at high valuations, basically go off the rails, and

they end up imploding. And there’s like 11 reasons why this

happens, I sort of categorize them. One of the biggest ones is

founder psychology, you have a founder who believes that

things are always going to be up into the right. It’s they,

they, it’s funny, they’re always described the same way,

described as visionary, charismatic, and the word crazy

is often used, but it’s crazy good. And then when everything

goes to shit, all of a sudden, the word crazy means something

pejorative and bad. And, you know, the problem is that, you

know, these characteristics of being highly visionary and

charismatic, they also can be combined with an unwillingness

to listen to advice. And so, you know, founders who have those

qualities there, they can be a good thing, but they have to

seek out advice from people who’ve had experience,

otherwise, they’re going to make a mistake and hit the wall

being delusional is, you know, what you need to start these

companies, like, I’m going to beat these incumbents, I’m going

to change the world. A little bit of delusion is good, but

not when you’re looking at the runway, right? Like, that’s when

you need to be pragmatic. I think, you know, there’s a term

of coachability, you know, how coachable is this person as a

CEO as a leader. And I do think that coachability goes hand in

hand with intellectual curiosity. I mean, if you look

at the Collison’s Patrick Collison, and how much breadth

he has, and some of the topics he’s interested in, and the

things he writes about, it indicates to me a high degree

of intellectual curiosity. And people who are intellectually

curious, generally are very humble, because they’re

constantly seeking things they don’t know. And they recognize

that they don’t know a lot of things. And in that same kind

of mentality, they are willing to recognize that other

individuals can have good points of view that can inform

their perspective, and they’re willing to change their

perspective. And I think that’s a really key, key thing that if

you look across the range of successful founders, CEOs that

scale to $100 billion plus valuations for their businesses,

that to me is one of the more common threads is this kind of

intellectual curiosity, which translates into a coachability,

which translates into an adaptability as and being

willing to take advice. And so your board is a tool, not kind

of a governance structure sitting over you. I think the

less you are like that, the more you are likely to feel like

your board is a governance structure, an umbrella sitting

over you telling you what you can’t do. I don’t think that’s

what governance means, by the way. Well, governance meant to

it’s meant to look out for the shareholders. That’s the job.

Right. But to act as a fiduciary doesn’t mean to like tell the

CEO what to do. This is my point. Like, yeah, I’m just

saying, it’s not

I think he’s right about, I think freebirds right about how

boards are often perceived by founders, I think there is an

increasing, let’s call it a Hollywood director, a Hollywood

auteur mentality towards VCs,

Jake Allen, the all in podcast, right?

Well, it’s, it’s basically, it’s basically look, there, there

are certain incubators out there and accelerators and whatever

who teach these young founders, that it’s all about their

vision. And anyone who stands in the way of it is basically

interfering with them. And they are the auteur like a Hollywood

director, and you got to stay away from those suits, the

studio guys, right? Ever. That’s the mentality they’re trying to

they’re teaching them

an adversarial mentality,

an adversarial mentality. And look, there are to Jamal’s point,

there are plenty of VCs who don’t know what they’re doing,

they have no useful advice to offer. But the better mentality

to teach a founder would be like, look, the world is so

complicated and building a company is so complicated, it’s

gonna be 10 times more difficult if you don’t seek out advice. So

go find board members who will let you ultimately do what you

want, but will still give you the advice if something’s going

wrong.

And what was true at one point in time when Paul Graham gave

this advice, and he set up Y Combinator, you don’t want to

say their name, but it is Paul Graham had a terrible

experience in his company with venture capitalists. So he set

up that wartime stance between founders and the investment

community. And you know, founders fund became the

antithesis of the traditional venture funds, and they were

going to be founder focused. So but that advice then might have

been true. And now it’s not now we’ve sung the pendulum too far

the other way. We did two things because we saw this 10 years

ago, when I started seed investing. And then when I

started building positions of over 5%, I just said to

founders, if we own over five or 10%, we should have an option

of a board seat. And we’ll do board seat, we’ll do board

training with you. We will just teach you we’ll take like here’s

some decks that we’ve seen from other, you know, here’s some

decks that are available. And we’ll show you what a board is

like. And then I would have three founders come to would

sit on one board meeting, and I would do three back to back

board meetings, bring your counsel, bring your founders,

and sit in on the other two board meetings. And we’ll have a

little Socratic discussion about what was good about each board

meeting, we did board meeting training as a proxy for venture

worthiness later on. And when those companies did go out to

get venture, and they had an ESOP, and they had board minute

meetings, they just looked more impressive to the venture

community. So I know people say don’t do a board, it’s not cool.

It actually turns out doing a one hour board meeting four

times a year, six times a year, even as a seed stage company.

It’s it does differentiate you to the venture community, I

find. All right, moving on. And speaking of boards, Elon bought

a chunk of Twitter last week, a 9% stake, and he’s joining the

board that makes him the largest individual or the largest

shareholder, individual or institutional. He bought the

shares in March, Twitter CEO Parag Agarwal tweeted, I’m

excited to share we’re appointing Elon Musk to our

board. And then Jack tweeted in support. I’m really happy Elon

is joining the Twitter board exclamation point just to give

some level setting here in q4 of 2021. Twitter had 1.5 billion

in revenue up 22% year over year, they’ve really been

starting to ring the register over their daily active users

are solid but modest 217 million daily active users 38 million of

which in the US 179 million are international. And their stated

goals for q4 of next year 2023. So in a year and a half, they

want to have 315 million, and they want revenue in 2023 to hit

7.5 billion again, they’re on a $6 billion run rate. So I guess

that would be an increase of 25%. Just general thoughts on

and Elon obviously has been making some Twitter suggestions

for the product. sacks you worked with Elon at PayPal.

Thoughts on what this does for that wasn’t why you’re laughing.

It’s like such a funny transition. sacks you work with Elon at PayPal.

I’m sure he’s gonna have some great product ideas. But what this

is really about is free speech. You know, right before Elon

announces he was doing polling, asking the Twitter user base

whether Twitter was succeeding or failing in his mission to be an

open town square and open marketplace of ideas. Something

like 70% said they were failing at it. Elon, on many occasions

has spoken up for free speech. He believes that Twitter’s historic

mission is as an open town square. And I think he’s going to

bring that emphasis to the board. And it’s a great thing.

Now, I think the person who had the best take on the reaction to

this was Mike Solana. And he had a few funny tweets.

Who is Mike Solana? Who does he work for? Is he a Founders Fund guy?

I think Yeah, I think he works for Peter Founders Fund. But he’s

got a he also writes a great news substack newsletter, kind of

like a blog post called pirate wires. It’s worth checking out

He’s a pretty, in addition to being a pretty sharp analyst, he’s

actually says a lot of funny things, too.

He’s iconoclastic. And yeah, yeah, he he’ll he’ll swing the sword.

Yeah. So the way he put it is that, you know, Elon joining the

board has all the worst people on Twitter furious. They think

that this guy might actually say free speech. And for

authoritarians, that is an existential threat. And then he

added, I don’t get what the problem is, guys, if you want

censorship, you can just go build a new social media company

and do censorship there. It’s a free market, thereby turning on

its head, everything they’ve been saying, which is, you know,

when the people who the authoritarian, the authoritarian

people who love censorship, whenever anyone complained about

censorship, they would always say, well, just go create your

own social network. You know, we’re free to do whatever,

truth, whatever.

Exactly. Well, this is this is the free market acting in a way

they don’t like, which is finally somebody who believes in

free speech is wanting to stand up by the largest stake in

Twitter, join the board. I mean, this is fabulous.

I think it’s really fabulous.

I think it’s pretty amazing. Yeah. And the stock went up 30%.

What do you think?

I texted you guys in the group chat, I think that if he is able

to make free speech cool, again, he’ll, he’ll actually do more

doing that than potentially through SpaceX and Tesla. And

that’s already saying a lot. Because free speech really is

this fundamental principle of democracy, and it’s been

decaying. We don’t know the implications of a large

technology company, keeping free speech as a principled pillar of

their reason to exist. Right? Because we have seen free speech

kind of decay. And we’ve seen sort of, you know, random

decision making that seems arbitrary by a lot of these

technology companies. And, you know, the payments companies,

free broke was mentioning visa and MasterCard earlier in the

group chat. But all of these things can change on a dime if

Elon makes free speech cool, again, and figures out a way to

make that a principle that everybody can embrace. Because

then if you really believe in that, then you go to the next

logical conclusion, which is what David has said for forever,

which is the only solution to, you know, speech, you don’t like

is more speech. And then that creates a surface area that I

think you can technically maneuver around. So meaning what

are the real problems in all of this speech creates, it creates

a, you know, content moderation issue, right? It creates a spam

issue. And it creates a sort of wisdom of the crowds ranking

rating issue. So misinformation comes to mind. Yeah. But that’s

it. That’s the wisdom of the crowds ranking rating issue in

my book. So I guess the point is that, you know, if he can get

the Twitter employee base, fundamentally on side of this

idea of free speech as a principle, that I think is

enormous, because you know that none of the other big tech

companies will ever even do that. And the capital structures

of those companies will never allow a single strong voice like

his to enforce that idea. So this is the only company where

that could happen. And I think, you know, we want to see what

this how this plays out. I think it’s a really, really big

deal. All right, freeberg. Yeah, I’ll tell you what I think

changes. Facebook, Twitter, even Google all acquiesced to

significant external pressure over the years. I’ve said this

in the past, I believe the founders of those companies are

all philosophically, fundamentally philosophically

aligned with the notion of free speech, and absolute freedom of

information, you know, enabling truth finding over time. And

the, the edge cases of those platforms, ultimately, identify

and uncover ways that they can be used against what, you know,

many would consider kind of the betterment of society. And as a

result, they acquiesce to external pressure that drive

some of these censorship decisions and drive some of

these, these behavioral changes by management. But I think that

if you concentrate the ownership of those businesses, and rather

than have kind of a distributed shareholder base, meaning the

public markets were the largest single shareholder in Twitter to

date, has been jack Dorsey at 2.3%. He actually serves the

shareholders, and the shareholders ultimately want to

see the stock price go up. And they ultimately want to see the

business make more money. And as a result, they don’t have the

same sort of, you know, the stakeholders there have kind of a

different set of alignments over time, you know, they’re not

necessarily the same long term, or focus meeting, does the

philosophy come before the money. And I think as you kind

of concentrate ownership, you have the opportunity and the

option now to, you know, make make those sorts of decisions

that you can’t make when you’re a broadly owned stock. But

Facebook and Google are concentrated. Yeah. So what are

you talking about? The issue chemoph is in those companies,

they’re scared to death that they’ll lose their employees and

have chaos at work government. No, the issue is government.

Also, it’s your employees. And below it’s Yeah, it’s

shareholders, it’s shareholders and government regulators, right.

And so in both cases, you have to the pressure and employees.

It’s a good point. Yeah.

I understand. But I’m not sure how Twitter changes any of that.

It does. I’ll tell you why. Because if we look what’s

happened is, let sometime last year, I think it happened

around Chappelle. And I think it happened because a coinbase we

saw a group of folks say, you know what, enough is enough.

Yeah, we told you to bring your whole self to work. We told you

we would do your laundry. And then at some point, Netflix was

like, listen, you don’t have to agree with every comedian on our

platform. There’s a range of comedians. And if you disagree

with this one, you can do a walkout, you can protest, you

can make your feelings hurt, or you can choose to not work

here. And then Daniel Eck kind of did the same thing. He said,

Listen, at Spotify, we’re gonna put labels on it. If you don’t

like Joe Rogan, don’t work here. And then of course, we know

coinbase did it. And Toby from Shopify did it, and I have

Twitter doing it. And when you apologize, and you start

listening to this very vocal minority, when they’re upset,

and they want to cancel people, or they want to D platform

people. What do they do? They double down, you’ve shown that

you’re going to listen to them. They’re not doing it at coinbase

anymore. They’re not going to do it at Spotify anymore. They’re

not doing it at Netflix. And Apple acquiesced, right? They’re

like, we don’t like, you know, Antonio’s book, chaos monkeys.

And he said these three things in an award winning book that

we find are, we’re gonna fire him. I think at some point,

Apple’s gonna have to say, you know what, leave your feelings

at work. And this is a company, leave them at home. Thank you.

This is why Elon is so dangerous to these people is

because he won’t be pushed around. The fact the matter is

that this whole woke mob thing, it’s a paper tiger, they don’t

have the support of most of the population. It’s a handful of

very noisy voices on Twitter, and social media who insist on

having a monopoly on the right to shape all of our narratives.

And they want a monopoly on moral outrage, they want a

monopoly, moral outrage, they want a monopoly, but they also

want a monopoly on the ability to basically to define what is

acceptable and what the what the narrative on any topic is going

to be. And all it takes is one strong person to stand up to the

mob, as we saw Brian Armstrong do at Coinbase, and the mob

dissipated, he took, you know, Brian,

they go find another target, they find another target.

Exactly. So yeah, Elon doing this is a really big deal.

Because again, he cannot be pushed around. And he is showing

leadership here. And all it will take to end this woke censorship

is for other founders to stand tall the way that Elon has.

And let’s let’s go into the nuance.

He’ll care what employees kind of gripe about, I don’t think

he’ll care what regulators gripe about. And I don’t think he’ll

care what other shareholders gripe about. He’ll talk about

the long term opportunity, the philosophical alignment with

mission, and and plow forward. And I think that that level of

leadership is what separates some, you know, great businesses

from others. But this is a very

listen, there were moments of D platforming that were earned by

people like Alex Jones, who was saying that the, you know,

families of Sandy Hook were false flags, and their children

weren’t murdered. There are, you know, Milo Yiannopoulos, and

some of these alt right Nazi sympathizing people throwing up

swat stickers, you know, people promoting violence or

brigading on these services to attack people into docks,

people, those people, those were just cancellations, D

platforming from YouTube,

in your opinion?

Well, I mean, anybody inciting violence, I think we would all

agree should be dis platform.

Jason, look at how it’s evolved. We start with isolated

cases, like Alex Jones, like a Milo that nobody likes, and

nobody supports. The next thing you know, the President of the

United States is being D platform. But again, that’s

supposedly based on him inciting a crowd. Then what’s happening

today, now we have entire categories of opinion being

banned. It starts with COVID.

I agree. That’s exactly my point.

Anyone who has a dissenting opinion.

Now there’s invalid. I agree.

Anybody who has a dissenting opinion on COVID gets banned.

Now, anybody who has a dissenting opinion on climate

change can be banned. There’s a story this week on CNN, where

Pinterest of all Pinterest is a photo sharing site. I don’t

know. No one’s talking about climate change on Pinterest.

And yet I was, but then I got you.

I mean, it just shows this censorship now is on autopilot.

I mean, even sites where the conversation is not taking

place, are banning entire categories of thought and

opinion. Because it disagrees with you know, what the experts

say, and Jake, how you could point out your Alex Jones case

to make the case that D platforming should be allowed.

The problem is, as soon as you make that case, it’s only a

slight degree point to a slight degree away from the next case,

and then a slight degree away from the next case. And then

fast forward three years, and you’re banning entire topics of

conversation that ultimately may end up being proven to be a

topic of conversation we should have had. And if you look back,

by the way, what great movie Woody Harrelson, the people

versus Larry Flint, Larry Flint was a pornographer, it was easy

for everyone to chastise him. And for everyone to say, you

know what, let’s go ahead and D platform, this guy back then and

ban him and charge him by the government. And at the end of

the day, he fought for his rights for free speech. Now, all

that being said, Larry Flint was publishing using his own

printers and selling on the street in a very legally

compliant way. There is a difference in having someone

else’s platform be the mechanism that you use to promote your

voice. If they choose like Pinterest and Twitter and

YouTube and Facebook and Google to change how their platform

operates sex. I actually think that’s a commercial decision

made by a private company, they should have the right to do

that. But they’re going to lose users over time, they’re going

to end up looking like idiots when they’re wrong by banning

certain topics that we should be having conversations about

over time. And I do think that there are other mechanisms for

us to use the free and open internet. This is why I think

the free and open internet is more important than anything to

have conversations using other platforms.

I mean, and I mean, hold on, I just want to respond to David

since he did, you know, counter my point. I agree with you. I

think it went overboard. And I think there are more reasonable

solutions. I think a time based ban would have been better for

somebody like Trump, and maybe waiting to see what happens with

the January 6 Commission. Putting that aside, I know it’s

very controversial. You know, when you just look at what

Spotify did to our podcast, I don’t know if you’ve looked at

us in Spotify, every other episode says COVID-19

information here. I think this is one of the best things if

people want to talk about ivermectin, and it’s an open

science and free bird, you know more about it than any of us.

And people want to debate it. Why not link them to the most

credible sources? I think that’s a great solution. I have

a question. Yeah. Is there an oat milk tag on Spotify? Yes.

Because if there is oat milk, oat milk, oat milk, when you

listen to the all in pod on Spotify, there’s a tag that

says there’s COVID COVID-19. Yeah, get COVID-19 information

here. Yeah,

to free birds argument about these companies should be free

to do whatever they want. So I know that free bird, I want to

make two points about this. First of all, I know free bird

is sincere and genuine in that belief. However, most of the

people making that argument are completely disingenuous about

it. Because on the one hand, they say that these companies

should be free to limit speech when they like the outcome of

that censorship. But meanwhile, in Congress, they’re pushing

six bills for to regulate these companies as monopolies. So

they don’t believe that they should be free to do whatever

they want. They believe that they’re monopolies. And indeed,

many of them are monopolies. And even the ones that aren’t

monopolies act the same as all the other ones, they act as a

cartel to limit speech. So that’s point number one is that

nobody believes this argument that these companies should be

free to do whatever they want. The second point is that listen,

the founding document of our country, the is the Declaration

of Independence, it says that all of us have rights, they’re

inalienable, that means they cannot be taken away. Okay. And

in the first couple 100 years of this country, it meant that

those rights meant that the government couldn’t take away

your right to free speech. But now today, where does speech

occur it, it occurs on these giant social networks that are

privately owned, they’re owned by these large corporations. And

the fact the matter is, if they take away your right to free

speech on these platforms, if they censor you, if they do not

have a right to free speech in this country, that right needs

to be protected. The founding fathers did not anticipate that

for people would be mitigating the majority of conversations

online. It’s you know, like if you’re if you’re taking off, if

you look what happened to below and Alex Jones, like they don’t

exist in the public sphere anymore, right? Like literally

person when these big tech companies all get together as a

cartel to deprive you of your free speech rights, you have

been deperson you’ve been digitally deperson and they’re

not just doing it on speech. They’re also taking away your

right to engage in payments in transactions to earn a living.

And unless we stop this now, it’ll keep going.

We have to address the giant elephant in the room, huge,

which is Trump. I think a lot of this, you know, he hit its

pinnacle when people were saying the the sitting president of

the United States could not be on Twitter. That was I think we

all agree ridiculous and absurd that the president who was duly

elected couldn’t have a Twitter account. But then with the

January 6, and the inciting of the violence and you know, all

the stuff that’s coming out, and obviously, we’ll we’ll see

where that all winds up. I’m curious what everybody thinks

here about should Trump or is Trump being put back and

reinstated on Facebook or Twitter, and it’s supposed to be

a lifetime ban on Twitter. But if corporate governance changes

and people lobby for that, do we think that there is any kind

of situation where Trump has his Twitter handle or Facebook

accounts reinstated? And should he have them reinstated? I think

Jason, what you suggested is probably the most reasonable

thing, which was there was a time based penalty. You know,

we’re, we’re getting through, we’re probably what, a third or

two thirds of the way through the January 6 stuff. So that’s

going to come and go. And I think all roads will probably

lead to a conclusion that after three years, it’s probably okay

to let this guy back and be able to tweet. I mean, it’s not this

is not, you know, controversial stuff at this point, you know,

that the current thing is moving on from Ukraine, when the topic

all of a sudden is January 6, all over again, and Trump, which

it is on MSNBC, it’s all January 6, all the time again. So

listen, I mean, this is not a justification for the widespread

censorship that we’ve seen. Like I mentioned, we’ve gone so far

beyond isolated cases. Now it’s entire categories of thought.

And this has to be stopped.

Well, what’s your feeling on Trump? Should he be reinstated?

If you were running Twitter, would you have done a time based

if you don’t like Trump, just don’t follow him? I mean, but

but frankly, it’s, it’s, listen, I don’t miss the tweets at all.

My thoughts. I don’t miss the tweets at all. I really don’t.

They were damaging your party. That’s how you felt.

My thoughts have evolved before when he first got banned, I was

really supportive of it. And there was part of me which was

just afraid that he would get reelected, etc, etc. Now come

two years later, and to see all of the stuff and the escalation

of D platforming. I think the problem is exactly what you guys

have just talked about, which is the person that does it today

points to the person that does it yesterday, who points to the

person that did it the day before as the justification. And

so even though we don’t want to draw a straight line between an

Alex Jones and a Trump and climate change, unfortunately,

there is this line. And so in general, now a much more free

speech, because I think it’s much more fragile than I thought

it was before.

Got your opinion has evolved and intelligent people should

respond to new data. I appreciate that.

And I was a person that, you know, as David said, was a

little disingenuous in the sense that I kind of was for

free speech, as long as it was stuff that I agreed with. But

two years later, how much more on David’s original camp now,

which is we just need to establish this as a pillar of

society, and not deviate and find credible voices on both

sides. And then algorithmically and through people power,

meaning through crowd, you know, wisdom of the crowds type

stuff, help people figure out what is truthful and how much

truth there is, because that’s a tractable problem. But the

minute you start cancelling stuff today, as I sit in 2022,

what I would tell you is I think it’s very, very bad, because

it’s going in a really bad place.

For what are your thoughts on Trump specifically, because it

does seem like that’s a part of the undercurrent here of, you

know, he’s going to be coming back possibly going to be

running again. And January 6 is considering the truth social

network, download the app, listen to what he’s got to say

it’s rocking and rolling over there on the truth app. I heard

they took it down, like it wasn’t even working, right? The

the new thing he built.

But what is that? What is that smack trading at? Was it a 20

billion or something?

Still doing well. But look, they had, you know, obviously a

reaction, a market driven reaction to the fact that he was

taken off Twitter. And he said, I’m going to go make an

alternative. And that’s, you know, certainly proving to be

technically difficult. But as we all know, it’s not technically

impossible. He’s just got probably the wrong people

working on it. But if they wanted to have an alternative

platform for hearing that voice, you know, have at it. I

don’t know what else to say. I mean, it’s Twitter’s decision.

They’re curating their audience. All these guys want to

be free speech advocates. But at the end of the day, they’re

all editorializing. And that’s just the world we found

ourselves in.

I hope Elon takes a sledgehammer to that.

Yeah, I mean, it’s exactly what Shema said is they’re all they

all believe in free speech and free markets when it produces

the outcome they like. But when the outcome is not what they

like, all of a sudden, they’re like, Whoa, these companies are

monopolies.

Well, and here’s another opportunity. If you’re not

libertarian and believe in like, you know, free speech, and you

know, Constitution, like it, you could buy shares, you could

lead a group, start a Dow start a hedge fund, whatever, build a

block to buy a bunch of shares, and then you can get a board

seat on Twitter. And you can have this debate on the board of

Twitter. And it’s absolutely right.

You are absolutely right. And you can see, by the way, you

know, small hedge funds with small amounts of capital, like

engine number one, you know, they were able to go up against

Exxon and beat them. So to your point, Jason, for the people

that actually want to censor more, if they can organize the

capital, they absolutely have the right to do that. And I and

I think that they if they if they’re able to do it, they

should win.

That’s, that’s, that’s what Mike Solano was kind of getting

out. It’s like, look, if you don’t like if you don’t like the

the free speech that’s happening on Twitter, go create your own

social network, because that’s what they were saying before by

the shares and have influence. That’s how corporations work.

The shares are the votes. Yeah, Friedberg update us on, you

know, the Ukraine is in month two now. I’m sorry, Ukraine is

in month two. Sorry for putting the thumb before it. It’s a

tough habit to break. Friedberg tell us, you know, the second

order third order effects of fertilizer and food. At this

point, we’ve had this back and forth. And now I think the world

is starting to realize, hey, Friedberg was right. These

downstream effects are going to be significant. I asked you a

question about these, which is, can the world not mobilize if

these are about 1% of the calories 20 or 30% of calories

in certain country? Could the world not mobilize to find other

caloric sources, rice, fish, soybeans, whatever? Or is our

system so fragile, that we can’t rally around sending food to

anywhere on the planet, despite the fact that we can fly

anywhere and go on vacation for two weeks anywhere on the

planet? No, the food system is complex and efficient. But it

does not have strong redundancy, or malleability. So take for

example, you know, how do you get flour, you get flour in in

your food, from a food company that bought the flour from a

miller, there are mills around the world that process flat

wheat into flour, you can’t take that same mill and process

corn into flour, there’s different technology, different

equipment that’s used, same with soybeans, and so on. So when

you look at how the food supply chain is constructed, you know,

there’s a local point of consumption, which is a store,

then there’s a food processor, and you work your way kind of up

the supply chain. And there’s a certain input that’s required to

make the output that people consume. And so calories, while

they might be fungible, practically speaking, or

philosophical, or fundamentally speaking, they’re not

necessarily fungible, practically speaking, on the

ground, when you actually try and plug in, let’s say soybeans

into the milling supply chain, to make the pasta or the bread

that everyone consumes, in Tunisia, it’s not going to work.

And the same is true with rice. And then the more important

dynamic force that’s underway, is that these markets for food

and commodities globally, are not controlled by government,

they’re controlled by private businesses. And there’s a market

for these products. And so what happens is, as the food supply

chain threat hit, countries like China and others started to

stockpile, they started to buy lots and lots of supply, drive

up their stocks and their reserves, you know, for fear of

the famine that’s about to hit us in about nine months. And when

they did that, there was now less food available to Tunisia

to Eritrea and to Egypt and so on. And so we’re starting to see

the effects of that dislocation, driving dynamic market forces

where certain buyers stock up, and then the folks that can’t

afford to step in not being able to acquire product and being

left. So not only do we have a local production differential

that makes it hard to have all calories be fungible, we’re also

seeing this dynamic where there’s a bifurcation where the

haves have more and have not have less. And that’s going to

really make this famine kind of hit home in a really, really

sad way. In the months to come. We’re already seeing, as I

mentioned two weeks ago, yeah, as I mentioned a few weeks ago,

the fertilizer problem driving acreage down. So the USDA farm

report comes out, they survey farmers and figure out how much

they’re going to plant every year. And they just downgraded

the number of corn acres are going to get planted this year,

which is happening, starting this month, from 93 million

acres to 89 million. That doesn’t sound like a lot, but

4 million percent, yeah, 4 million acres coming out of

production of corn in the US is an incredible amount of calories

that are not going to be planted to corn. And so that has all

these downstream effects. And again, this, this crop doesn’t

come to harvest till, you know, September, October, then it’s

going to get processed, and it turns into food. So by the time

the the effect of this decision making hit the marketplace, the

availability of calories and the stockpiling that’s going on,

it’s like, boom, some countries are going to be, you know,

they’re gonna have a limited budget, they’re only going to be

able to access so much food, and they can’t access any and other

countries are going to be fine. The United States can be fine.

Western Europe will be fine. China will be fine. Sri Lanka is

going to be a mess. Northern and Eastern Africa is going to be a

mess. I mean, there’s like places around the world that we

are going to have to scramble. I don’t have a real easy answer.

There’s no simple plug and play here. It’s going to be a really

complex set of problems that are going to need to be solved.

Well, Sri Lanka does grow a lot of its own food. So they may be

okay, because they’re an importer, right? I mean, they’re

pretty big net importer. So they make a lot of food, but they

rely on imports a lot for calories there. So yeah, I mean,

that’s the case with a lot of places around the world. A lot

of people think, oh, we have farmers, but most countries, you

know, particularly in the developing world are net

importers, they rely on third party supplies of food. So but

a lot of what you’re talking about, though, or not. They’re

processed foods that come into the country. sacks anything to

add here? Well, I mean, I think that the Ukrainian war is kind

of entering a chronic phase. I mean, the sort of entering a

new phase, the first phase, you’d have to say that the

Ukrainians one, you know, the Russia wanted to topple

Zelensky’s regime, maybe take Kiev, they obviously failed in

that. Now, we’re in this phase where the fighting is over in

the Donbass. It’s basically the civil war has been going on

there since 2014. And, and really, that’s what it’s now

about. Zelensky has acknowledged that Ukraine will

not be part of NATO. So that issue is kind of off the table.

And so what they’re really fighting over now is the status

of these disputed territories in eastern Ukraine. And I think

it’s going to go on for a long time. That’s what you know,

General Milley testified, it could go on for years, I think

it’s gonna become a sort of permanent feature in the

background of Biden’s presidency. And I mean, I think

the good news is that hopefully the war three aspect is off the

table, it seems like the calls for us to impose a no fly zone

or to put boots on the ground, which you were hearing a lot of

a few weeks ago, seems like that’s off the table. So now

it’s just going to be a protracted, I think, civil war

going on in the Donbass with between Ukraine and and Russia

and their proxies, which would mean sex, correct me if I’m

wrong, that Putin will be hobbled forever, they’re not

going to be a world power. And his power is going to deprecate

because he’s going to be busy fighting this non winnable war

for some period of time, which is in a way saying Biden did it

perfectly, and checkmated him. I’m saying that’s going to be

your assessment. If there’s like a civil war going on, and and

Putin is crippled, that would be checkmate or no,

I think I think that clearly the the State Department

strategy here is to make Putin bleed in eastern Ukraine and

protract this thing make it go on as long as possible. I think

that’s a risky strategy. Because this thing could always

spin out of control.

It’s risky, but could it be effective? Is there a chance it

could be effective?

Well, I mean, if the goal is to blue Pete bleed Putin, yes, it

could be effective bleeding Putin. However, I don’t know

that that needed to be the key geostrategic objective of the

United States right now. I don’t know. I don’t know. Because

look, China is our main threat. China is a peer competitor to

the United States. Russia is not our economy is 15 times bigger

than Russia’s. China’s economy is about the same size as ours.

That is a real threat. So you know, there are costs to us as

well. There are clearly cost to Putin of this, but there are

huge costs to us as well. Freebird described the risk to

supply chain, we’ve had to now spend a lot more money building

the defense in Europe, we’re going to be pinned down in

Europe, we should really be moving some of those resources

from Europe to East Asia. I mean, that’s really where the

pivot to Asia is what we thought we were supposed to be doing

until quite recently. Now we’re gonna be bogged down there. And

there’s still risks of inflation and recession in the US. And I

think if we are in a recession later this year, I think a lot

of people in the US will be asking what was this all for?

And if you go read my article that just came out yesterday,

based on my speech is published in the American conservative.

Look, this war was easily avoidable. I mean, the State

Department could have avoided this war very easily.

I thought your I listened to your speech, I thought your

points that you were very clear on, hey, Putin started this, he

is the aggressor, it’s his responsibility. But you know, we

do need to think about our foreign policy as a country. And

regime change is probably not a winning strategy for us.

Although in this case, it might, it seems like it’s a

possibility now. So who knows?

I don’t, I don’t think we’re gonna get regime change. But if

we do, there’s no reason to believe that we’re gonna get

something much better. In every case where we push for regime

change, we’ve actually gotten the same or worse. So yeah, I

don’t think that should be our objective. You know, I look, I

think we have a bunch of bad options. Now the war’s already

started, the best option would have been to avoid this war in

the first place. And if this thing drags on for years, and

the US economy tips into recession, people will look

back and say, why didn’t Joe Biden State Department in the

year 2021, do a much more effective job preventing this

war?

Let me ask, let me ask this follow up question as we wrap

here. Chamath, I’ve been thinking about what should a

strategic objective be for America. And the number one

strategic objective I could think of was, or one of the top

ones would be to build a strong relationship with India, which

obviously, you know, it has an adversarial relationship with

China already, on the border of Pakistan, and then obviously,

you know, has relations with Russia. What would be on the top

of each of your lists, Sachs and Chamath Chamath, you go first

on priority here, if we’re thinking fresh looking at the

world with China in retreat, sort of disengaging from the

West with Russia on their heels, what could the United States in

the West do as a preemptive measure to really solidify

democracy? And, you know, the the world order, a peaceful

world order?

I’ll answer it slightly differently, which is, we need to

put ourselves in a position to not be dependent on any country.

Because then we can actually dictate what we think the right

approach and solution is from first principles, and have the

courage to stick it through to get to the other side of it. So

there are really two things we need to do. The first, which

we’ve kind of perverted, unnecessarily is energy

independence. And we’ve allowed too many people to conflate and

muddy the water on what energy independence means, you know,

nobody’s nobody was ever advocating for coal. But you

know, the amount of coal that we could have burned as a bridge

fuel to LNG, which could have been a bridge fuel to things

like nuclear and wind and solar, that path was pretty clear. But

we got in our own way, we have to get out of our own way. Okay,

so energy independence, I think beyond anything else,

strategic, probably an order of magnitude, it is the most

important thing. And then secondarily, there are certain

areas for the future of those future economies, where we need

to have complete capability and know how. And the most important

ones there are the specialty chemicals that we need

specialty chemicals, that we need to basically support

climate change writ large to support battery production writ

large. And then semiconductors get those two things completely

under us control. On top of energy independence, and

honesty, we would be a dominant world power for the next 200

years on our terms.

So the road to resiliency sacks, you’re now the Secretary of

State, what are your key priorities?

The US grand strategy has always been to prevent the rise of a

pure competitor who can dominate their region and then challenge

us for global hegemony. There’s only one country in the world

that can do that right now to us, which is China. So the pivot

to Asia, as Obama said, was fundamentally correct, but we have

not followed through and executed it. And now our attention is

distracted and bogged down by what’s happening in Europe, I

would seek a negotiated settlement to this war. Now that

this Zelensky government has survived, Putin has been unable

to take Western Ukraine. And furthermore, that Zelensky has

given up being part of NATO. The only thing left, okay, is this

fight in the Donbass. There’s a there’s an agreement already on

the table called the Minsk Accords that can allow us to

settle that. Meanwhile, pivoting to Asia, wrap it up. Meanwhile,

pivot to Asia, create a strong alliance of countries in East

Asia who are threatened by China, we already are friends

with many of them. You’ve got Japan, South Korea, Taiwan,

you’ve got Vietnam, create a balancing alliance of those

countries to prevent China from rising to the point where it

can threaten us for global hegemony. That should be our

main priority geopolitically. Great. All right, there you have

it, folks for the rain man, David Sachs, the dictator

Chamath Palihapitiya, and the sultan of science, David

Friedberg. I’m your boy Jay cow, and we will see you all in

Miami, May 15 16th and 17th. Love you, boys. Bye bye. Love

you besties. Bye bye.

Oh, man. We should all just get a room and just have one big

huge orgy because they’re all just useless. It’s like this

like sexual tension that they just need to release somehow.

You’re a B. We need to get merch.