a16z Podcast - The Question of Education

Episode Date: September 11, 2020

Monopoly, oligopoly, cartel. All three of those words can describe the (not so) modern education system today, given the cost structures, economics, and accreditation capture -- in everything from who can and can't start a new university (when was the last time a significant change happened there anyway?!) to where government funding really goes to the student loan and debt crisis.Yet degrees do matter, just not for the reasons we think. So what are the tradeoffs -- when it comes to the "right" school, making money, and assessing skills objectively -- between what's been called "hard" (B.S.) and "soft" (B.A.) degrees? What's the best book on career advice, and what advice does Marc Andreessen -- who went to a public university, worked on a revolutionary project there, and started a company right after -- have for students (and others contemplating change in their careers)... and especially for those considering dropping out, delaying, or skipping college altogether?Andreessen shares his thoughts on the purpose, past and present of education (briefly touching on the impact of the pandemic as well) with Dylan Field, CEO of Figma, which is free for students and educators. The Q&A was recorded in August 2020 and originally appeared as a video in their "Back to School?" interview series; it was actually inspired by the question of taking a gap year and questions about whether or not to go back to school this year that came up in their Virtual Campus community of students from across the world. image: Lyndsy Rommel / Flickr

Hi everyone. Welcome to the A6 and Z podcast. Today's episode is all about education. It's based on a conversation that took place last month between Mark Andreessen and Dylan Field, CEO of Figma, as part of an interview series they hosted for Back to School. And we're running it here as part of our post-Labor Day Back to School Week theme with Mark. Earlier this week, we also ran another Q&A he did on productivity, scheduling, reading habits, and more. This Q&A, which originally appeared as a video, covers the purpose, past, and present of education, briefly touching on the current pandemic and its impact. It goes into the costs and economics of education, everything from student loans and the debt crisis, government funding, industry cost disease, credentialing and accreditation capture, and more to the tradeoffs of what's often been described as hard and soft degrees when it comes to making money and assessing skills objectively. To finally sharing lots of advice for students and others contemplating change in their careers, and especially how to show your work and get noticed. Well, throughout the episode, threading the tricky question of what to make of those

who have considered dropping out, delaying or skipping school to go straight to field work or startup. The conversation was actually inspired by students in the Figma design community, who were contemplating the decision of whether to go back to school earlier this summer, and is part of their broader and free program to help make design accessible to all. For links, to Figma's community of students and other resources, please see the show notes and go to figma.com slash education. For more in our education series and archives, you can go to A6NC.com slash education. Well, let's start off with an easy one. What's the purpose of college? Well, there's the overt purpose of college and then there's the actual purpose of college.

So, I mean, the overt purpose of college is fairly obvious. It's sort of this bundle of services. And it's, you know, the bundle basically is like, you know, some level of sort of educate, some level of actual education slash skills training. We'll probably talk a lot about that today. And then it's, you know, basically this kind of four-year kind of, you know, adventure for young adults, you know, where they get to, you know, in theory, socialize with their peers and so forth, form networks. And then it's, you know, it's a dating service.

It's a real, it's a real life Tinder experience. Tinder larping, maybe. And then it's, you know, you know, and then it's a giant sports. complex, you know, generally attached to a hedge fund in the form of the endowment. So it's like some bundle of services. It's obviously the brand plays the plays a big role. You know, it's obviously very important potential in today's society. That's the overt purpose. The sort of, you know, slightly more cynical view is that there is sort of an implicit purpose, which basically is, it's basically the way employers delegate personality testing that to somebody else.

And basically so they basically don't get in trouble for it. So in the old days, you know, 20, 30, 40, 50 years ago, employers used to actually do personality testing. And so if you applied for a job at Hewlett-Packard as an example or one of the big companies at the time, you would actually take like a battery personality tests. And they would actually test, they would test your IQ. They test for intelligence. And then they would test for personality traits. And they'd be fundamentally trying to get to. In particular, they were trying to get to a personality trait called conscientiousness, which basically is sort of what it says. But it's basically like, you know, are you a self-starter? Like there's actually two sides to conscientiousness. There's a

was called industriousness, which basically is energy, basically being self-repelled, and there's orderliness, which is basically attention to detail. So they're kind of trying to capture a sunset of both of those. It became some combination of kind of socially undesirable and illegal for employers to do those tests. And so basically those, the current theory kind of is that those have been outsourced to the colleges.

And then so basically the implicit purpose of college, number one, is basically it's an IQ test in the way in in the form of the SAT or the ACT. And then the other part is of colleges, what's called the, they call it the sheepskin effect. which is basically the fact that you prove that you can actually finish the program. Yep. And that basically, it's basically an applied test of conscientiousness, this personality trait called conscientiousness, which basically is,

basically it's a predictive thing. If you can finish a four-year college degree, it is believed by employers that that is suggestive that you can also finish many other tests, that you'll be a responsible worker. The reason we know that's the case is because of what's called the Sheepskin effect, which is somebody who goes to college for seven out of eight semesters, does not receive seven eighths of the income of somebody who goes for eight out of eight semesters, they receive half the income of somebody who goes for eight out of eight.

And so there's basically the sheepskin effect is either that last semester is responsible for a full half of the skills in education that you receive while you're in college, or the skills of education are somewhat beside the point. They're just trying to see whether you can get over that four-year hurdle. And so the sheepskin effect is what psychologists refer to or education experts kind of refer to as like it's basically the proof that you were able to complete the program. And so anyway, then if you're an employer, this is why employers have indexed right so much on college degrees over the last 30 or 40 years is because it's just, it's the easy way to say smart kid can finish his work, done. So when should someone go to college?

Yeah, so I'm a believer, so I'm a pragmatist. We'll have, you know, multiple, I think, parts of this conversation today, but I'm a pragmatist at heart. So my view is like you basically, you have to, as at the individual level, you should take the system kind of as is constructed. Like you shouldn't try to, like, fight to like, basically overturn the system is starting. 18, like you should get in a position of maybe power and authority before you do that. And so I'm a big believer. It's like the system as it is today, American employers are very, very heavily, and Western employers generally are very, very heavily focused on college graduates. In fact, one of the really weird things that's happened in the economy that probably is a bad

thing, but it has happened, is that there are just, there's been a steady increase in the percentage of jobs that actually require bachelor's degrees, including for jobs where you would think it wouldn't, you know, you wouldn't need that kind of requirement. But it's just, it's, it's, it's, because of how the system is of all this kind of where we are. And so I think it's actually quite dangerous to give somebody the somebody as an individual the advice, don't go to college. Like in the current system that we have, that's basically saying don't prove that you're smart, don't prove that you're industrious and conscientious, and then basically be prepared

to settle for fundamentally lower income for the rest of your life. And I think that's extremely dangerous advice. So the general advice is basically, if you can go to college, go to college. That said, I think it's worth being very aware, right, of a basically, what that actually means, right? And we already discussed, you know, some of that in terms of, like, what you're actually proving. And so, for example, if you go to college, the general best advice is finish college, right? And as you know, like, one of the things that we've kind of fetishized a little bit in Silicon Valley over the last, you know, 20 years is basically this

idea that dropping out, right? It's just that's been a benefit of, probably, to be very clear. That's right. And so basically, like, again, it, like, it is true that, like, Bill Gates and Mark Zuckerberg and all these people dropped out of college. It's also true that that's very bad advice for most people. Most of us, it turns out, aren't Bill Gates or Mark Zuckerberg. And so, like, generally speaking, go to college, finish college. That said, be aware of what's happening. And then the other thing, which hopefully we'll talk about at length, but like, we sort of have this tendency in the public discussion on college just talk about like going to college. And we're already doing that. But it's like, okay, there's two big loaded kind of dependencies in there, which is one is which

school, right, matters like enormously. And then the other is which major, which matters enormously. And I think there's, you want to kind of think about like a two by two matrix of majors in schools, and the outcomes are wildly different depending on where you land in that matrix. Yeah, so basically, I think people focus way too much in whether to go to college, they don't spend nearly enough time focusing on what school and what major. And so basically, and here's where things get like super interesting. So basically what you see is that for the sort of hard disciplines of like engineering and math, it actually turns out there's a fairly flat distribution of income,

by rank of college. And so generally speaking, if you go get like a electrical engineering degree or a CS degree or a math degree, and then you look at kind of earnings over time, you know, you do somewhat better if you go to a school that's kind of high up the rankings, but you do fundamentally more or less the same over time across all the schools, which is like an engineering degree as an engineering degree. And like electrical engineers or computer scientists or programmers or whatever, you know, to the extent that they're kind of always in demand, like there's a market clearing wage

for that skill set. And it kind of doesn't matter. Now, there are certain employers where they, like, will only hire people out of certain top engineering programs, but like most employers across the economy hire out of a very broad range of schools. And so, so like, anyway, so those are like the hard disciplines. We've talked more about that. Then there's sort of the soft disciplines, and this is sort of, you know, kind of liberal arts, humanities, you know, kind of all of the, you know, sort of, I'm going to say, BA versus BS, right? So the BS degrees are like the hard degrees, the hard science and math and, and, and,

and engineering degrees. The BA degrees, Bachelor of Arts are usually the software, you know, sociology or English lit or, you know, philosophy or, you know, a lot of these, you know, kind of humanities, liberal arts kinds of things. For those, there is a dramatic curve, which is you get paid much more with those degrees coming out of a top school than you do coming out of the average school or a lower-ranged school. To the point where you really kind of got to ask the question, like, is a sociology degree

from like, you know, from the lower two-thirds of colleges, like, at this point, is it actually worth anything. And the answer, you know, the answer there might actually well be, it may not be worth anything. Like there may just simply not be jobs for those people who have that degree from those schools. And the conventional explanation for that, people could have different theories on this. The conventional explanation of the education experts kind of believe is that basically for the soft degrees, there, like for the hard degrees, there's definitely a skill. Like can you design a circuit or not? Can you solve an equation or not? Can you write a computer program or not? For the kind of soft degrees, liberal arts, humanities, everything's a little bit, you know,

It's more open interpretation, you know, like good essay versus bad essay kind of thing. It's a little bit more in the eye of the beholder. And so basically the theory is that if you get one of those degrees from a top school, you also get the network. So from an investment standpoint, if you're looking for ROI, you should, at any school, it sounds like hard sciences you're saying good investment, sort of softer sciences or humanities, a bad investment unless you're going to a top tier school. Well, yeah.

So, yeah, yeah, yeah, I think that's right. And of course, this, this, this, this begs of, I can hear the howling kind of in the, in the, in the, in the audience already on this topic. Like, this, this begs the question, right, of like, what is the purpose of a college education? It was just sort of obvious, which is the, the college, the entire point of a college education is the income that you make after you get the, after you get, you get the degree. And so I was, as a kid, like, I was never confused about that, right? And the idea that there are all these intangible kind of things about, like, you know, whatever social this and that and, you know, kind of the, the, the, the, the, all. all the other, you know, I would say aspirational right with the liberal arts people will say is it's about how to live a good life and it's about how to have the right values and it's about how to this, you know, become like aware of the world and all these things. And like, and again, I'll try not to take a position on that. You could, you can believe either sides of that. And so maybe my point is like, maybe there are non-economic reasons to get a liberal arts degree and maybe there are non-economic reasons to get a liberal arts degree even at a college that's not top tier. However, even if you believe that, you should go into that eyes open of what the economic result of that

is likely to be. And the economic result of a liberalized degree from a lower end college is not likely to be what people think it is. And by the way, this factors, you know, this factors then directly into the whole kind of concept of the student loan crisis, which is like a huge, basically the student loan crisis is basically a two-part crisis. But the part of it is just like the most kind of, you know, kind of honestly tragic is basically kids that realize too late that they're getting the wrong degrees and or from the wrong school. And then they just don't have the income to be able to service the degree. And I, and I think in that case, like it's basically like that that's the part of the college system that like honestly enrages me because

I think it's basically taken advantage of naive kids and naive parents who basically have been sold this concept that college is good even when that's not always the case. So if you were president of the United States total control of Congress, I know scary, but if you were and you could do anything to address student loan crisis, what would you do? Yeah, so first I would resign instantly, which I think honestly would be the only responsible thing to do. Well, look, this is starting this. So I forget what it was. I think it's the governor of Kentucky, if I recall correctly, one of the governors a while ago came out, because, you know, these are all, there's a big state level kind of component to this because they're all these

state, they're all these state colleges, universities that the state subsidizes for these states, excuse me, subsidized. And so I forget, I think it was Kentucky. The governor of Kentucky, I think came out and basically said, like, we need to stop. Basically, it's time for these schools to stop teaching, like, liberal arts. Like, it's just not an economically, like, valid proposition because, like, the degrees aren't worth as much. And, of course, that generated. I don't know if he's followed through on that because that generated huge controversy because people people hate to hear that. But, you know, look, at some point that has, look, at some point you have to have a question about value, given, value received. In particular, look, I think people should be able to buy and pay for anything that they want.

Like, you know, people want to go get whatever degree they want and they want to pay for it. I'm all in favor. But, like, we do have this, like, federal loan program that is just basically is this monotonically increasing pile of debt. And by the way, like, the student loan program is like it's this, it's basically this load, right? of like trillions of dollars of debt on the American taxpayer. And so there's like one question there. And then there's the other like impact on the students themselves, which is like student loan debt, at least today,

student loan debt is the one form of debt that you can't discharge through personal bankruptcy. And so these students aren't just basically getting victimized on behalf of society. They're also getting victimized like personally. And it's like causing, you know, big, you know, especially this newer generation last 20 years. Like there's a lot of kids running around. Like they've been very damaged by this. And so I think fundamentally, like I think there has to be at some point, There has to be the honest discussion about value given, value received.

And then the other side of it, which we might talk about, the other side of it is there has to be some examination into how we got a system that ended up with this kind of adverse outcome. And I think I know why that is, which is it's a cartel. It's a government kind of sponsored cartel, and I think cartels are bad. And I think we need to kind of fundamentally reconsider the system. You can't just drop that without going into that. So what do you mean it's a cartel?

So viewed through an economic lens. So K through 12 in the U.S. right, is the monopoly, right? and it's just a government, it's just a flat-out government monopoly. It exhibits all of the school, and they have no option. It's compulsory education. It's literally compulsory audience. It's compulsory education. It's basically state-funded, it's state-run.

These are government institutions. These are government schools. It shouldn't be called public schools. They should be called government schools, which is what they are. And so, you know, it's the government running a school, just like the government would be running a restaurant, right? The question I always want to ask on these things is, how would you feel about eating government sushi?

right and then you know equivalently how do you know how would you feel about you know how would you feel how would you feel if the department of transportation started making cars okay right would you would you want to drive the official US government DOT design a manufactured automobile like is that an attractive problem you think that would be a safe thing to do on the freeway right you know the DMVs think about the DMV designing cars right and so like basically we have decided that like we don't let the government make sushi and we don't like the government make cars but we let the government make schools and we expect that we're going to get better results and of course we don't get better results because, of course, we don't.

And the reason we don't is because it's a monopoly, right? And the motto of any monopoly, right? The motto of any monopoly is we don't care because we don't have to, right? Like, it's just like the needs of the customers, like, don't matter at all to the monopoly. That's the whole problem of monopoly. And so K-12 is a monopoly. It exhibits all those characteristics. And just to pause for a comment before we go on to non-K-12,

what data would you point to that says that, because a lot of listeners are probably going, okay, well, I actually had a great K-12 experience. What data would you point to that says, okay, K through 12 doesn't work? Oh, yeah. Well, it's just spiraling prices. So the great myth is that we somehow slashed the funding for public education in the U.S. over the last 40 years. Like, that's just, like, false.

We've, like, greatly expanded it. And so, like, the load per student, the dollars per student in real economic terms in the last, like, 40 years, it's something like tripled in the U.S. And the results haven't moved at all. Like, they're just flat, right? And so massive price increase, no quality increase, like monopolies. Right? Like, yes, like that's what you get. If somebody had a monopoly on cheese, that's the same thing you would get. You would get the same cheese every year and it would cost more every year, right? And so it's the exact same thing. Now, and look, if it is where you say like people get what they want, if people are happy with the result, then, you know, fair enough. Like if people are fine with this level of quality, then fair enough. And if they're fine paying more every year, fair enough. If they're fine having, you know, their taxes go up consequently, like, you know, fair enough. But like that is the result of a monopoly is that that's the case. For colleges, it's different.

It's not, the government doesn't actually own to run the colleges, but it's a cartel. It's an oligopoly, is the technical term. We think about it as it's a cartel. And it's a government orchestrated and blessed and sponsored and funded cartel. And this is really important. So there's basically, there's four basically streams of money effectively that end up going to the universities that are in the cartel, all the current universities. Well, so the state universities get like direct funding, right, from the states. Then there's the other funding to the state institutions.

Then there's the funding to the so-called private institutions. It's air quotes, for those of you listening on a podcast version. And it's basically, number one, it's the student loan subsidies, right? And so none of these institutions would be viable, right, if they had to provide their own financing, which is why you've got this federal, massive federal student loan program. And access to the federal student loan is based on accreditation, and the accreditation is run by the government. It's enforced by the government.

And so it's basically like the challenge, the thought experiment would be try to start a new college today in the U.S. and try to get it accredited to be able to get access to the federal student loan program. And like, I'm sorry, I haven't tried to do that. I don't know, you know, do I say the odds of success in that are quite low because the existing universities would view that as new competition and they try to kill it. They try to make sure it couldn't get access to federal funding. That's one. Second is there's all the federal research funding, right?

And so for all these schools that do like science and engineering, there's always two sides. There's the teaching side and there's the research side. And so there's all the federal research funding. And again, that's a cartel. and then there's people in the government are they are only going to give grants to people that they know or programs they know well they're either only going to do that because like that's that's sort of the reinforcing loop and there's there's like a revolving door of kind of who runs these programs also we can talk about it's kind of the standard form of kind of implicit corruption that happens with

these kinds of systems but then there's also like can you I don't actually even know the details but like can you actually get research funding if you're not an accredited institution like can the NSF actually issued a grant I don't know whether that's the case or not but I wouldn't be shocked if they literally can't do it. Or if a bunch of people all of a sudden try to get access to that grant money that they would put that rule in place. And so it's basically, I mean, look, here's the thought experiment. Like what was the last major new research university that was created in the United States? Not true. Yeah. Nobody knows because it's been so long, right? Like, it's been, I don't know. Like, I actually honestly don't know. It might be Stanford.

Like, as there been one since 1890, like, I don't know. And so, So, like, that just kind of tells you, like, the market, the market, it's not a properly functioning market. Like, if there hasn't been a new entrant in a hundred years, like, the market's not functioning properly. I mean, even in the car industry, we have Tesla, right? Like, you know, like, at some point, come on, like, somebody's, somebody's, and look, people have tried this, but like, it's indicative of how hard it is to do it, that they haven't been, they haven't been kind of, they're not obvious.

And then research funding. Good one was research funding. And then there's two forms of tax breaks that these institutions are all allowed to run as non-profits, which is a very specific kind of blessing that the government gives them. And there's two forms of tax breaks. There's tax breaks that are allowed to run nonprofit at the operating level. And they're allowed to run their endowments, invest them on a nonprofit basis. And so they not only do not have to pay taxes on their actual operating income.

They also don't have to pay taxes on their investment income. And again, like try to get a new university in place and not only get access to the first two that we talked about, but also get access to these tax prices and nonprofit. And by the way, you just go to these universities now, these are big businesses, right? These are like, you know, they run these like giant sports programs, right, that like have like, you know, national audiences. They run these giant endowments, you know, that happens. You know, some of these endowments are not $30, 40 billion big, right? These are like, you know, huge hedge funds.

You know, there's all these programs. There's like, you know, steadily rising, you know, kind of compensation to administration. There's, you know, all these things. And so, like, they have many of the hallmarks of a for-profit business. They just don't get tax like one. Yep. And so anyway, so it's just, and so basically, it's the accreditation cartel that kind of reinforces all that. And so it has all of the same basic characteristics.

characteristics that you would expect, you know, it's a slightly less worse form of monopoly. So basically, K-12 monopoly college system is an oligopoly that is jockeying position and trying to increase status and rank. And then would you say that's like the pure explanation for why price outpaces inflation? Yeah. So then, yeah, so this is exactly. So basically there's a very clear formula for basically skyrocketing prices, right? And just to kind of put the issue on the table. On the track that we're on right now, the price of a four-year college degree in the United States is on its way to a million dollars, right? At the top institutions, a million. Well, at the top institutions, it's already cleared a quarter million,

right? It's already over $250,000. Right. And it's escalating much faster than inflation. It's, you know, escalating extremely rapidly. And so, like, you just, all you just need to do, maybe we could link to some of the charts, but like you just, you just project out the chart. It's just this linear rise in prices over time, far faster than inflation. you just like write it, and you can just kind of pick the year when it crosses over a million dollars. And so, so on the one hand, college, four-year college degree is going to cost a million dollars. On the other hand, a hundred-inch flat-screen TV that you can watch Netflix and play video games on is dropping, and it will ultimately cost $100. Wow.

Right. And so this is the very clear, like, compare and contrast, which is basically, right, the colleges are like the ultimate, basically, monopoly, oligopoly, as we discussed. Flat-screen TVs are like the ultimate, what they call perfect competition, right? There's just like, there's just endless competition to drive down the price and increase the quality of those things. And so we're getting the exact results that we would expect in the systems that were built. We're just like really angry about it, right? Because like we, you know, we think it's unfair and unjust. But like it, the system is running as design in both directions, the economic system that we have is running as designed.

Yeah. So, oh, so so so so so yeah. So then you basically say, well, okay, why on earth is this price just keeps skyrocketing? And it's basically it's just, it's basically supply, supply needs demand like any market. And basically what the government does in education is just like what they do in health care. like what they do in housing, is they basically have a two-part strategy for managing these markets. They restrict supply, right? So the fact that you can't build, as we discussed, like you basically practically speaking, can't build new colleges and universities in the same way anymore.

And then subsidizing supply causes prices price, or sorry, restricting supply causes prices to rise, because there's more kids that want to go to school than can get in. So prices rise. And then on the other side, because prices are rising, that creates political pressure, which they resolve by subsidizing demand, right, with taxpayer funding. And so it's, which also causes prices to rise. And so what they're doing on the supply side is causing prices to rise. And what they're doing on the demand side is causing prices to rise. And so there's twin forces propelling prices to the moon.

And there's no sign of anything that I can see anywhere in the system. I see nobody pushing back on this. No, sorry. I see nobody in a position of power and authority push you back on this. So I expect it to continue indefinitely. I'm very tempted to go into just very briefly the parallels to health care and housing. because that's kind of a new idea for me that they are parallel to education.

I know that they are in some places increasing also faster than inflation. But what do you mean in terms of government restricting supply and subsidized demand for health care and for housing just briefly? Yeah, yeah. So for housing, it's basically the same thing. So for housing, and specifically, right,

it's housing all the places where people really want to live, right? So this is not really an issue in like, you know, rural Wisconsin or like rural Arkansas or something. Like this is an issue in like San Francisco and New York and San Diego and Seattle and, you know, Austin and all the places where people, you know, all the places where there's, like, lots of economic opportunity. It's always the same housing policy. And the housing policy

is don't build housing, right? Like, again, it's basically these cities are like local monopolies. These cities are local monopolies over their own geography. They've got their local employers. And so their attitude towards, you know, some of those would be made. Taxpayers. What's that? And stakeholders in the form of taxpayers that. Yeah, yeah. And then you've got this kind of warp in the market where basically the people who participate in local government are the retirees. And so you get this, there's kind of this very deep inherent conservatism to city governments, even in these very liberal cities. And so the result basically is that basically in these cities,

they've largely outlawed the construction of new housing. And there was a, there was just a great example of this. There's a guy named Robert Reich, who used to be the Labor Secretary under Bill Clinton, who's become this like fire brand liberal activist. He's like an AOC kind of type. And he's been like railing on the increased cost of housing, you know, and kind of in public.

And somebody just found, he lives in Berkeley, because, of course, he lives in Berkeley. And he, somebody just found a, letter, he and his wife wrote to the local planning commission, basically attempting to kill a new housing development down the street from his house on the grounds that it would ruin the historic character of his Berkeley neighborhood, which is in a microcosm, basically, the mechanism by which these cities are all basically not building new housing. They say things like we don't want to ruin the character. They say things like this and that, construction

and traffic and all this stuff. What they actually mean is like this city is ours and like we don't want more people to move here. And again, like it's not restricted supply. Yeah. And so basically the government's basically, the city level governments basically just like, they don't permit new housing to get built. So I just say as an example, San Francisco is a city with a population a little under, just slightly under a million people. Annual budget, by the way, of $13 billion, which is amazing, if you think about what you're getting for your money there. And then they authorize the average year about 6,000 new housing units total. Right. And so think, you know, think about your company or think about Figma, right, which is San Francisco base. Think about how many people you're hiring, like, and all of your peer companies are hiring, and all the big companies are hiring. And then think about the idea there's only 6,000 new housing units a year. Like what, you know, It's like, what do you think is going to happen to prices, right? Yep. You go through the roof. And then again, because the price of housing rises so fast, because of the restricted supply, that creates pressure on the politicians, right, who need an answer to, like, what is the

government going to do about that? And so their answer is to subsidize demand. And that's in the form of all the federal mortgage programs, right? And then that ultimately, right, is what led to the 2008 financial crisis. And that continues, right? We continue to subsidize housing in the U.S. And so, again, it's these twin forces both driving prices to the way. And then the exact same thing is, health care is the exact same.

system. And then here's the significance to this, which is just like, okay, think about for a second. It's like education, health care, housing. It's like, what are those things all have in common? Like, it's, it's like, why those three? Because if you look at like the chart of prices, like those three are like the three outliers, and actually it turns out those three, those are the three indicators of a successful thriving middle class. Wow. Right? What does it mean, like, what's the difference in a country like the U.S. between being middle class and lower class? The difference is I own a house right in a nice place like in a nice neighborhood like I am able to send my kids to like good schools both you know primary and secondary and I'm able to get I have health

insurance like those are like the three markers of middle class success and these are the three parts of the economy if the government has decided that we need to send prices to the moon okay so if I was listening to this in 2009 when I graduated from high school my sort of reaction would be screw this I don't want to participate in the system It sounds like your advice from earlier on was you might want to reconsider that. You should definitely, as a newly mentioned high school graduate, you should definitely participate in this hopelessly corrupt system. So, I mean, maybe this leads to COVID-19. How does COVID-19 change this?

Is this the wrecking ball here? Yeah, so COVID-19, COVID has a bunch of implications for this. So there's a meme that's been going around the internet that basically says, you know, video streaming services. Netflix, $10 a month, Hulu, $5 a month, you know, whatever, HBO max, $20 a month. Harvard, $60,000 a year. Right? And so there's this, the first thing is just like, okay, we're about to find, like, to the extent that colleges actually can't reopen in person, which I think is actually honestly the

case for this year, like a bunch of them are trying, but I think it's basically hopeless with what I'm seeing on the policy side, on the health side right now. Like, we're about to find out, like, this is a good test of, you know, I mentioned earlier, like, what are the potential sources of value of college? Like, if the source of value of college is what you learn, then presumably it has the same value if it's being streamed over video, right? But because we have no reason to believe that that is the primary source of value because of things like the cheap skin effect, like, it now really raises the question of like, okay,

is a video streaming service that cost $70,000, even if it has a Harvard name attached, right, or Stanford name attached? Like, is that actually a thing? Right. And so that's like a very big and important kind of stress point. there are two other really big and important, I would say, stress points on the system, though, that are surfacing really quickly, which is one is, these institutions are not designed to run for a year or multiple years with, like, no revenue. Like they just, even the ones of the endowments are not designed to run that way. And most colleges, universities don't have big endowments.

Most of them run on annual budgets, annual cash flow. And so how many colleges, there's whatever, 3,000 colleges universities in the U.S. something, how many can survive with basically a year with no revenue or with, like, greatly diminished revenue? and like we're about to find out. And I don't know the answer to that, but there are predictions that this puts as many as two thirds of them in economic peril.

Yeah. So there's an economist named Noah Smith and he writes for Bloomberg and he's an economist. He has been studying this if you check his Twitter feed and his Bloomberg writings. He's been looking at this

in quite a bit of detail and he's very concerned about it. So that's the best analysis I know. But like there's quite a bit of concern. Also, Clay Christensen, who was the creator of the disruption theory who passed away, unfortunately, recently. He wrote books and published

a whole bunch of papers on what he viewed as sort of an impending storm in education. He, unfortunately, passed away kind of right before COVID, so we don't know what he would think today. But I think he was already bearish on the economic future of a lot of these institutions for all the reasons we've discussed. And I think he would, I think if you were with us there, if you read his work, you'll you can kind of extrapolate forward.

So there's that. And then there's the overseas student aspect of this, which is like super interesting, right? Which is overseas students, and in particular students from places like China play a disproportionately important role in American colleges and universities because they pay full freight. They don't get all the federal student loan access and they don't get all the scholarships. They pay full load.

And the reason they pay full load is some combination of value they want the degree. But also, it's the way if you're a rich, you know, Chinese parent, it's the way to get your kid a visa. You can basically buy a visa by sending them to an American college. You know, it's shut down. Yeah. And if you like literally can't get here because travel is shut down, right?

Like, you know, and if in, yeah, and, you know, there's been this. Or a graduate student you're being sent back. Yeah, yeah, exactly, 100%. So there's been this big wrestling match. The Trump administration actually moved to prohibit overseas, you know, basically students with these visas from actually staying in the U.S. if they weren't actually physically going to come out. And there's a huge fight over that.

University's objected and all that. And, again, this is one of the political issues I won't take a stance on. But like, to the extent that foreign students can't physically be here to be on campus, it does raise the question of whether that they will continue to enroll in these programs. Like, they of all people are, they are the presumably least likely to pay $70,000 for the video feed, as I said put it that way. And they really were paying $70,000. dollars, like they were paying. And so if you look at the budgets of a lot of these colleges, like basically, they're heavily dependent. They basically charge the foreign students full freight, and then they basically, the domestic students are like the lost leader.

There's domestic and foreign subsidies is what you're saying. Yeah, yeah, basically right. Yeah, exactly right. And so it's like if I'm an administrator at one of these universities right now, and if I'm looking at a year of no foreign students and I'm looking at for a year of no physical campus, like I don't know. By the way, I also know a sports program. Right. So it's, yeah, Yeah, no. So this is what my old CFO used to call this the shake and bake. Like, this is one of those moments in which everything has been thrown up in the air. And I think it's really, really unclear where this all lands. Now, by the way, the most obvious thing that's going to happen is just like a massive federal bailout. Right. And so the most obvious thing is just like the government will just decide to bail out the entire system because that's what the government does. And of course, the taxpayer will pay for it. And so maybe it will be okay in that sense. But again, like if there's like a massive federal bail out of all these colleges, it once again, it'll be like what happened with Wall Street in 2000. made. It'll cause people to ask this question of like, wait a minute, like, what are we paying for? And so I think that these topics, we will all get very dramatic over the next few years. Let's say that, you know, colleges are shutting down. People are not going as much.

Do you see that basically making us that degrees are equally valuable, more valuable, or less valuable in 10 years, 20 years? So very unclear. Right. Very unclear. Well, because there's several dimensions to that question. like one is just like do you like basically do you believe there is such a thing as an online degree like look there's been remote learning for a long time like there have been extension programs like they're you know night schools and like those degrees have never been worth the same um and so is the video version worth the same like i would say unknown but like we're going to find out like we're going to find out like we're going to find out but like we're going to find out but like we're going to find out. By the way the other interesting thing is in parallel basically. Um, you know, in a way, personally I'm very excited about. Like I'm, I think we should find out, but like we might not like the answer. So I think there's that question. By the way, the other interesting thing is in parallel, basically, basically the SAT, A, C, and GRE are all being ejected right now. They're all being basically pushed out of the system. And again, this is a political topic I won't take a view on for the purpose of this discussion. But, like, there's the view on the left that these standardized tests basically are biased

and lead to what they call disproportionate outcomes. And so to the extent that the theory that schools are an intelligence test, the admissions process is an intelligence test, to the extent that that is true, they're about to toss that out. Like, they're just getting rid of that. So the UC system has gotten rid of that. Harvard has now dropped the GRE and his exam for their physics program, right? And so if they're not doing the GRA for the Harvard physics program, like, it's going to be dumped across the board. And so, like, that's also happening in real time.

To the extent that college admissions was an IQ test that employers were relying on, that signal is also being erased right now, is being deleted. And so we've got this kind of twin question kind of playing out in real time in terms of like what the app. And by the way, let's like, what's the value? Think about it from the employer's standpoint. like does the fact that somebody sat in front of a video stream for four years actually validate that like you know their conscientiousness like it seems pretty conscientious to me well it is unless you know i don't know like you know he takes like 20 minutes to write a script that like moves the mouse right on a mac so they like fakes the fact that you're sitting there paying attention so like

was that actually that was that actually the person or was that you know her zoom background um right like that's not a question people have had to think about and all of a sudden like it's it's a question. By the way, also, this other fun thing is GPT3. So there's been this, there's been a huge breakthrough this year in what's called natural language processing. And so there's this algorithm now called GPT3 that basically will write, it'll basically, it can basically write your, uh, your, uh, your, uh, entrance, uh, essay for you. Yeah, no, so it's like, okay, what kind of world are we living in? Like, what kind of world are we living in? If literally we're taking an educational format that was developed literally, like when universities were

first created, like it's like, what, 800 years ago or something? 700, they were kind of standardized 500 years ago. I mean, the university format was standardized before the preaching press, right? Like, it was basically, it's like, it's like, it's based on like, I don't know, it's like the old monasteries or something, right? And so, like, the idea that there is like, you know, the guy at the front of the room with like the 20 students and like there's, you know, talking, you know, meeting in person and then talking and then the way that they do the tests and all that stuff.

Like, you know, in the new world, like, I mean, number one, would you ever build an education system today the same way with the technology as we have now? And obviously the answer is no. Like, you wouldn't build anything the same way. you build everything differently. But then there's the like, okay, we're now going to try to transplant this 500-year-old model into these new technologies in a way where we're not even going to be sure the people were actually sitting there, much less that they actually filled out the exam themselves

or actually wrote the essay themselves. Like it's just increasingly going to provoke all these questions of like what the actual value is. And then aspirational, you know, as a venture capitalist and an entrepreneur, like aspirationally, it means like this ought to be prime time for new models. And we're, and we are, maybe we talk about those, but like we are starting to see those emerge. We are starting to see alternatives emerge and some of them are very promising. But, like, I would say, like, we like to quote, my partner and I like to quote Lenin as much as we can, because we're, of course, staunch capitalists, and we think it's funny.

So Lenin once said about, he said once said about social change. He said there are decades in which nothing happens. And then there are weeks in which decades happen. I quote on Twitter, but I didn't know it was Lenin. It was Lenin, yeah, yeah. And so this feels like, this feels increasingly like there will be more change in education in how we think about education and how we fund education in the next five years and there have been in the last 50. And I think that's, I think it's going to be very distressing, but I think it's also

exciting. And I think this might be prime time for new approaches. After decades or centuries of the same model perpetuating, we have a period of uncertainty and chaos for students that are looking at that and going, maybe I should take a break from college and try that gap year or try some break or something else, some working, for example. You know, what would you advise them with if they are not going to subscribe to the view of like just stick it and stick with it and get that degree. Yeah. So I was I was teasing Dylan in the run-ups doing the session. There's this concept of gap year and I was teasing Dylan that like where I come from, there is no such concept. And so I've always thought gap year is like this rich kid thing because like only rich kids can

afford to take that like the whole idea of a gap year. Oh great. A year of vacation. Like boy, that's how many people use gap years to work too. Okay. So then there's that. Yeah. Maybe maybe it's a process you could argue there's a process of maturation maybe, or yeah, maybe stockpiling money to live on. And then, of course, you know, there's, you know, there are countries like Israel where there's like mandatory military service, right? And so that's, you kind of get a whatever it is, two-year gap year, whether you want it or not, right? And arguably, right, arguably that's good, right, for a number of reasons, not least of which is maybe you're actually mature when you get into college, maybe you actually get more out of college.

Maybe you're, you know, you're two years older and maybe more disciplined and more motivated, you know, kind of having been in the real world for a while. And so, yeah, so I can, I can see all those arguments. And then I think there's the very specific form of that argument, which is the one that you bring up, which is like, okay, if I'm not willing to pay the X,000 dollars for the streaming service, like, okay, what should I do instead? And I think that is like, you know, obviously the purpose of this video, but also like an incredibly compelling and important question. So a couple things. So one is there are actually like new programs. And so the one, and I'm actually not investor in it, but like the guy runs it as a friend

of mine. So there's Lambda. There's this thing called Lambda, which is basically like an entirely new way to basically get essentially the equivalent of a computer science bachelor's degree basically in a year with a different economic with no loan it's actually a free program and then there's what's called an income share agreement and so there's that program which is well worth looking at there's udacity which is a company that we're involved in that has sort of a nano credentialing approach where you can kind of pick up skills and there's credentials attached to them and there's a bunch of employers that are very excited about those skills now you know there's corsair which is another company that's done a lot to push forward kind of online college

education recently and then there's all these existing kind of extent like I said extension programs and night school programs and so forth that maybe all of a sudden are more relevant There's kind of like all the new education methods. And so the thing to do might literally be to like do one of these other things instead, right? And so basically like take the year. And like let's hypothetically like let's even say you're going to college for music or something like that. Maybe take the year and go take the audacity or of course, error or Lambda thing and basically become a computer scientist in the next year.

Right. And then basically like and then go back to school, finish your music degree. And now you're a musician who also knows computers. There are those kinds of options. And then the other option is to actually build something, right? which is where Figma comes in but the way to think about that

so take a brief digression on kind of how to think about that and come back to this gap of your idea so basically like one of the interesting things about the internet is basically it turns out one of the things that's becoming very clear is there actually as far as the internet is concerned

there are like actually two kinds of professions they're the professions that have the characteristic we call you can show your work right and so where I can whatever it is that I do in my profession in my field I can actually show the results online in a way that's like very clear and compelling and like you know sort of fully

valid and then there's the professions where like I just can't like it just doesn't make sense so like I would say like professions where it's hard to show your work like heart surgeon is like a profession where it's hard to show your work right like you know maybe you could maybe you could get permission from the patient with HIPA and everything else to stream a video of heart surgery but like who can even evaluate that other than other heart surgeons and I don't like that's not really how heart surgeons advance their careers and then I don't know you know how would you know somebody doing you know there's lots and lots of fields I won't pick fields, but there's lots, lots of fields that might be lower value in which it's really hard

to show the work, or it's harder to see the value. But then you have these fields, and computer science has kind of always been the leading one on this, I would say, or maybe like writing has been the main one, but now computer science more recently, which is like, this is the whole thing with like open source software, right? Like open source software, like you literally show your work, like you write software code and then the software code actually goes on the internet and everybody can see it. And then you have, as you know well, but there's a system called GitHub that a lot of people choose to use to kind of put their software and then GitHub actually has like an internal ranking and rating system for software code and for programmers. And so you can actually

build a, you can build an actual professional reputation as a software developer on GitHub without ever actually being face to face with another human being. And so there are people all over the world today who are basically taking advantage of this, you know, to be able to basically build these incredible track records as a software developer make themselves more employable, right? Because the employers, and like my venture firm, like we recommend that our employers basically spend as much time on GitHub looking for good programmers as they do on LinkedIn or as they do going to like, you know, college, you know, college fairs or whatever. And so it's like software development, you can show your work.

Obviously, you creative writing, anything that involves, you know, written expression, you can show your work. You know, increasingly, by the way, the performing arts, you know, video, music, right, all these things, animation. You can show your work, you know, basically for free, which didn't used to be the, I mean, it used to be, if you were, like, going to be a professional animator or something, you might make a short film in, like, you know, film school. But, like, you'd have to get that, like, short film put, like, on this, like,

weird conference circuit and exhibited to, you know, convention circuit. and it'd be exhibited to like 18 people, you know, at like midnight or something. And now you can, like, put it on YouTube. And like, you know, if it takes, all of a sudden, you're, you know, you actually just like literally become like a star based on it. And then that has real professional credentials, you know, kind of attached to it. And then there's like, then there's everything like Figma gets in. Then there's sort of all aspects of design, right?

And so basically, basically all aspects of design, both the creative forms of design and then also the engineering forms of design. Yep. And so if there's a real argument that this should be prime time for people who have the kinds of skills where they can show their work to basically buckle down and make something. But take the, maybe in build your portfolio instead of seen on Zoom classes, perhaps. Yeah, and then basically, like, in some fields of like design, it may be literally a portfolio, it may be literally the design portfolio. And then it may also be actually build a working product,

right? So actually like design and build a software application, like all the way to completion, right? Or by the way, or join a startup, right? Their way to do this is as a team, join a startup or form a startup, right? And basically have like, you know, you know, get together with like you're four friends or meet four people on the internet who are also interested in the same thing or whatever or through a figma user group or something and then all of a sudden you like have a joint project and you're able to you know and you literally may never the great thing about the internet you may never meet right like you may never physically meet but it's actually feasible now to actually do the work potentially all the way to completion

and then really show it off and this is just this is like an avenue for career success that just literally was like basically impossible you know 20 years ago it's actually interesting in the creative arts um i don't if you know this the story of south this is actually south park This is actually the story of South Park. So South Park was the first viral internet video. This is actually really funny. So Treystone and Matt Parker in 1993, and there was no video on the internet in 1993. It was like a brand new idea to do that.

They were these, I don't know, whatever, art school kids or whatever, they got hired by an executive, a Hollywood executive to make basically a funny and very dirty, basically Christmas card video. And literally using cardboard, cardboard animation. And it was, you know, it was literally the characters in South Park and it was just this, like, really filthy little cartoon. And it went like super viral on the internet in like 1993. And it was like another, whatever, I don't know, it was like that was what, that was 10 years before YouTube, right, that they did this. But it went viral literally as a quick time download. And then literally based on that video, they got the contract to make South Park the TV show, which has now been on the air for like 20 years. And it's, you know, gigantically successful.

And so, like, they in a lot of ways were like the origin story for this kind of thing. And that's the kind of idea where it feels like we're still on. on the very front end of that. Well, it's like the best career advice in the world. Okay, so the best book on a career advice has ever been written as Steve Martin wrote his autobiography, and it's called Born Standing Up. And he's basically said the entirety of all career advice

that you can ever get, basically distills down to one thing, which he says, be so good, they can't ignore you. Right? It's basically, it's just like everything else washes out. It's just like the work is so good that, like, they can't resist. They have to hire you. They have to get you under contract.

They have to, whatever it takes. And so, you know, for people with talent, there are a lot of people with talent in the world, you know, basically show it off. Like, be so good, they can't ignore you. One thing that I hear from a lot of students who are considering taking some time away from college, whether it's working or building their portfolio or all these examples of work, you know, thinking about alternative approaches to education, is, okay, well, I don't

love the idea of going on Zoom classes all day long. But I also don't love the idea, you know, unstructured time because I'm not somebody that has a lot to structure to myself, I'm not very disciplined. And, you know, college is a way for me to surround myself with people that are inspiring me, that are encouraging me to progress in this way. As somebody who is, like, extremely intellectually curious, very disciplined about your time, what tips do you have for students around that time? Okay, so there's the big, there's actually been a breakthrough on this front.

It's called Google Calendar. So we talked earlier, we talked earlier about there's actually, this actually gets in psychology. this is very interesting. So there's this personality trait called conscientiousness. It has one are called two facets, which is there's industriousness, which is raw energy. And a lot of people have, you know, a lot of people, the kind of people you're talking about, a lot of people end up in college have a lot of industriousness. But then there's the other side of it, which is orderliness, right? Which is basically like, do you line up against basically expectations, right? And so like,

and literally it's orderliness is like a core part of your personality where it's like, do you make your own bed in the morning, right? Do you like wash your dishes after you have a meal, right? Like, is your house like what kept up? Is your lawn kept up? Is your lawn kept up is your car clean, right? And like a lot of people, like, by the way, including me, like listening to, a lot of people listen to the video are like, oh, shit, like, you know, my car's a mess, right? Like, if your car's a mess, like, you probably are like low orderliness. Because it, like, honestly, it doesn't take that much time to, like, keep your car neat.

So it's like a basic, it's a basic test. And so you've got a lot of people basically who are, for this question, I don't people who are like, they're smart and they're creative, right? And they're actually industrious and they're ambitious and aggressive and they want to do things. But they're just not, they're just not inherently all that order. And like you said, basically, one of the things the college does is it basically opposes the structure. It basically can paper. And by the way, a job does this also, right?

Job can pose orderliness also, you know, with things like schedules and deadlines and things like that. And so, yeah, so there is this like fundamental challenge, which is now you're on your own, like, basically, what basically is your proxy for whatever level of orderliness you don't naturally have. And most of us don't have enough. And by the way, I include myself. Like, me without a calendar is a disaster. So, like, I include myself in this. And my, my car and bedroom, left to its own devices are both just disaster. also. So, like, I sympathize with this. And so it literally, the best advice I've ever gotten is

literally, it's literally, it's literally, you know, pick your choice, but like Google's, Google's a good one, and it's free. And basically, the best advice basically is schedule everything. And again, this is the part where everybody immediately turns how it's howling because they're just like, oh my God, that's the opposite of how I want to live. But it actually turns out, the answer is actually schedule everything. And here's the key is you start by scheduling all the stuff that you actually want to do, right? So you start by scheduling your free time, right? So it's like, I'm not going to work from whatever, like for me, it's like, I'm not going to work from like 7 to 11 at night. Okay, 7.11 at night or free time. Like, that's just how they're scheduled. Right. But then I also

schedule 11 p.m. bedtime, right? Like, so that's like, you know, and then there's that. And then I schedule, okay, then I schedule if I'm going to work from like eight to five. I actually schedule what I'm going to do. And then by the way, I don't, I have a to do list, but like generally the goal is keep things off the to do list, put them on the schedule. Right. And so it's basically like get everything off that damn list, get it on the calendar in a slot. Right. And then basically it's like during the work day or the work period or whatever it is. Just, you know, this is easier said than done, but like, just do those things. Yep.

But do those things knowing that that will end at whatever time you choose to have an end. And then you will go get to do the other things that you want to do, spend time with friends or with your spouse, with a partner, go for a run or, you know, watch TV or whatever. Like literally, schedule, watch TV, right? Schedule, play video games, right? And then, look, this isn't like a silver bullet because, like, you still have the challenge of, like, adhering to the schedule. Yep.

But I just find for me, the big breakthrough was, like, it's a lot easier to, like, force myself through a lot of stuff I don't want to do if I know that there's a big block of time coming up down the road. It's like my reward for doing those things, which is like I actually get to do what I want. And so I think that's, it's the best method anybody's found so far. As we come to the end of this conversation, so I want to be respect to your time, I'm curious, a lot of people that are watching this are likely entrepreneurs or people that want to be entrepreneurs and they're likely wondering, okay, well, but will he put his money where his mouth is? Will Mark or Andrews and Horowitz, would they actually fund me if I, you know, end up dropping out or focusing for a year on a project and ends up going well, you know, by some definition or it seems promising, would the me drop me enough college, would that be used, you know, would that be a reason why they wouldn't fund me? How do you think about that or how did you respond?

Yeah, so I would say the good news on that is we don't really care. Like I can't even remember, I don't think we've ever had a discussion. I don't think we've ever had a discussion of did this person finish college. I don't think we've ever had a discussion about there is some signal you do hear a lot it's like okay the people who went to the programs that are like unusually good you know the conversation we had earlier like there are certain for example computer science programs that are just like outstanding and are known to be outstanding and it's just clear in the data that they're outstanding and so you know there there is some some edge that is a case there are cases where there is an edge to kids who've gone to certain schools for sure um but yeah did you finish not necessarily um you know did you it's so that's the good news is that's not so much that's not so much the factor and by the way

the other thing like we never we have no idea what anybody's SAT scores are we have no idea with I mean I guess we do know what their GPA is but actually it's funny we always worry about the kids of perfect GPAs uh as founders um because it's like are they kind of too orderly like are they too are they too much rule followers right it's it's like on the one hand they demonstrated that they're like really smart and really conscientious on the other hand it's like they demonstrated they love following rules right because they've got it's like you really want your entrepreneurs you fund to be like rule followers like is that a good idea as a venture capitalist and so so anyway but like we don't we never we never look at SAT scores or ACT or G or any of that

that's the good news the bad news is we're looking at everything else right and and everything else is basically like it's basically like what have you actually it is what have you actually done it's like what what what what what what reason do you have to believe that you actually have the skills and experiences and basically capacity to be able to do all the stuff that's can be required to build a company. And the thing that we always point out, and this topic also gets kind of highly contentious in a real hurry, but the thing we always point out is a lot of entrepreneurs, especially these days, venture capital has become this very kind public concept. Like, people used to not even really, I never even knew about it until I came to

Cal, like, I never even heard of it until I moved to California, but now, now everybody knows about it. And so there's this view of like, somehow the threshold of being like successful entrepreneur is raising venture capital. I always point, and you can, you can talk, you know, you can talk to any, you know, you're a great case study of this, but you can talk to any founder who's actually built a successful company, raising venture is the easy part, right? Like the VCs are like sitting there, like we sit there every day, like, waiting for like the next Mark Zuckerberg to show up like that money. What's that? Your job to give out money. The job is exactly right. It's the job to give out money. And like

the big problem we have is we don't have enough people coming in who like have all the skills and attributes, you know, to be able to build these companies. And so like we're just, we're in constant despair that there aren't enough people for us to fund who have those skills and attributes. The reason for that is because you raise the money from us, that only begins all the actual work, right? Because all the actual work is building an actual product that somebody will actually pay for, figuring out a way to actually sell it to them, actually collect the money, actually service the customers so that they actually have a good experience and that they're referenceable, actually tell their stories so that anybody will even know that they exist,

you know, run a finance, you know, function so that they don't like lose all the money, run a legal function so they don't get sued all the time, right? All the things involved recruiting, like actually get anybody else to ever work with them, right? It's like a really like fundamental thing. And so the challenge we always have is trying to explain, including to entrepreneurs we meet with, the challenge always is like, look like, you know, we love you, but like, honestly, like, they're, you know, we just have not yet seen in you that you can, that you can do some set of those things. And of course, we can take flyers on some of those things, like some of the time and nobody ever comes fully formed. But like, we can't just take

like a raw flyer on, on anything. Now, that said, the number one thing that causes a first time founder to get funded is a working product. Right? So the, the, general rule of thumb is like if you're just like a brand new kid in the industry and like you haven't built anything and you show up for venture funding generally you're going to be very disappointed because like there's a million of you like your mother loves you like you know there's another thousand of you like right down the street like I don't know what to do with this but like if you're a kid nobody's heard of and you show up with like facebook.com and it's working right like that's a that's a thing right that's important and so this this is why I like the

Steve Martin thing so much right be so good they can't ignore you the way to be so good they can't ignore you for venture capital, has come in with a working product. You're an A16s portfolio company listing, or you want to be an A16 portfolio company, should you require a college degree when you hire somebody? So that is a very rapidly changing topic for the reasons we've discussed. I think Google actually just dropped the requirement altogether for college degrees, and probably the most of the other major employers are going to follow. That is a really good question.

It begs, again, it begs the question of what was it good for in the first place, right? and especially, like I said, once they finish dumping the SAT, A-C-T, it'll be interesting to see kind of what happens to that part of the signal. If people can't actually go to college and go to campus, it makes the question of what's going to happen to the conscientiousness metric. And then really the question is like on the other side, right? It's like, okay, what then will employers actually be looking for, right? What is the thing that they'll be evaluating and judging? And so we've talked about a lot of this, but I think it's going to be like, okay, alternate credentials. Like I think there's a real opportunity here. Obviously, as I

said, Udacity is one of our companies in this we're very excited about, but there are others like Lambda. There will be new credentials that will be taken very seriously. Google, by the way, Google has also, I haven't seen the details. They've actually announced a certification program. It's actually interesting. Google's been doing these math competitions forever as a sourcing mechanism. So they have these math and coding puzzles. And at least in theory, they'll hire the winners of those kind of essentially sight on scene, I think. And so the new version of that, they're kind of standardizing that. So they've got this like coding credential. I saw something where it's like $300 or something. And if you can like basically,

they pass this coding test, they'll basically consider it to be the same thing as a bachelor's degree in computer science. And so, like, they made, in other words, like an employer creating their own credential is something that I think is going to happen. So new external credentials, new internal credentials. And then I think employers, like, as I said, we've been encouraging our companies to focus a lot on this show the work thing. Yep. And so like GitHub in particular, GitHub used to be one of our companies now by Microsoft. GitHub in particular has become a major credential, independent of all the rest of this for hiring software developers. Your suggestion to an entrepreneur would be look for people that have a great, you know, basically

GitHub presence or portfolio versus people who necessarily went to like the most amazing school and finished. Well, think about the pros and cons, right? Because the question is like, okay, for the show your work stuff, it's like, okay, that, presumably that actually is a good IQ test, right? Because like, you know, basically people have to be smart to like write good code and have to do a good design. So that's like, that probably hasn't embedded. But is there a conscientious test embedded in there?

Maybe, right? Or maybe it's an artist who's just like really a discipline but got like one, you know, had one really creative thing. And maybe they're going to be a great artist, but maybe you wouldn't want to actually have them work for you. So there's like a, you have to kind of, again, you have to kind of probe in on like, okay, what actually do you know? You know, that said, look on GitHub, people are building real track records on conscientiousness.

So, you know, on GitHub, you can actually see like how much code they've made and over what period of time and how many check-ins. And it's like, you know, it's look, like number of lines of code is not like the metric that we measure good software by, but like, if somebody's, checking in code every day for five years, right? Like, and it's code that is building like a successful project at scale and you can kind of see the quality of the work. Like, at that point, you've proven more than any college degree could possibly prove.

Well, so I guess I'd say this. If you're specifically, this is a more specific form of the question, what should a software developer do? The question is unquestionably the answer is open source, right? Unquestionably, the answer is go basically create an open source project or go become a member of an existing open source project and make successful, high quality, sustained contributions just do that project over time. And that's like that, that I think at this point,

I think that's clearly a better credential than getting a computer science degree. And I've hired people like that myself. Like that, that makes tremendous sense. And, of course, the great thing now you can do that from all over the world. And so I think that's great. And then I'll defer to you on the design front of you probably know more than I do.

But like, I think a very similar phenomenon is starting to happen for sure. And there are designers who have gotten hired entirely on this basis who have done very well. Actually, you probably know this. Video games. You know, there's this whole, there's video games. And there's whole community and basically, basically, amateur are basically game designers who are what are called mods and levels and mature basically

user-generated basically sort of expansion packs for these games and actually the game companies have been hiring more aggressively recently out of that modder community and again independent of any credential so that's probably another great example so this conversation is pretty wide-ranging if you relieve a student listening that's either considering in college or they're in college right now with a quick piece of advice what would it be yeah look I mean if you're in college like execute on the opportunity. So like, I mean, honestly, you know, take the hardest, you know, take the course load you can, like, you know, try to get a good GPA, but like basically try to get the skills, right, try to get as many of the skills. By the way, you know, cross-disciplinary we haven't

talked about, but like, you know, look, let's put it this way. If you're going to get my advice in getting an English degree or something from a sub-year college and you can settle up with all this debt, like, at least start taking coding classes, like start to like, start to like layer in the skills and take full advantage of the opportunities. And so, yeah, you know, maximize that. And then if you're looking for these alternate paths, and this is why I started with a recommendation that kids go to college, which is like if you're taking these ultimate paths, like just be very clear eyed about what you're actually getting. Right. So if, you know, with these new credentials, you know, with or with the work that you're going to do, like the kind of thing that you're going to work on. Like so, for example, if I'm going to work on open source, would I be better off making minor contributions to five projects or like a major contribution to one project? Like make, this is the second one. Make a major contribution to one project because that really demonstrates what the, what employers are looking for. And just be kind of put yourself in the mind of, how somebody's going to be evaluating you three or four years down the road and then basically apply against that. Awesome. Mark, thank you so much. This has been really fun conversation. Good. Thank you, Dylan.