The Pomp Podcast - 305: Shervin Pishevar On Identifying Industry-Defining Entrepreneurs

Episode Date: June 1, 2020

Shervin Pishevar is one of the most successful venture capitalists in Silicon Valley. He has previously invested heavily into companies like Uber, Airbnb, and many others. Shervin was also the former founder and executive chairman of Hyperloop One, an ambitious plan to change the way that humans and cargo are transported. In this conversation, we discuss Elon Musk, Travis Kalanick, the various industry-defining companies that Shervin has backed, why creators control the new media paradigm, and why Shervin believes Bitcoin is a long-term systemic bet on humanity.  ===============================  Our second sponsor is choice, a new self-directed IRA product that I'm really excited about. If you are listening to this, you are likely part of the 7.1 million bitcoin owners who have retirement accounts with dollars in them, but not bitcoin. I was in that situation too. Now you can actually buy real Bitcoin in your retirement account. I'm talking about owning your private keys and using tax-advantaged dollars to do it too. Absolute game changer. https://www.retirewithchoice.com/podcast?kid=19DN5C ===============================  Pomp writes a daily letter to over 50,000 investors about business, technology, and finance. He breaks down complex topics into easy to understand language, while sharing opinions on various aspects of each industry. You can subscribe at pompletter.com

What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Let's kick this thing off. Shervin Pishvar is one of the most successful venture capitalists in Silicon Valley. He has previously invested heavily in the companies like Uber, Airbnb, and many others. Shervin was also the former founder and executive chairman of Hyperloop One, an ambitious plan to change the way that humans and cargo are transported. In this conversation, we discuss Elon Musk, Travis Kalanick, the various industry-defining companies that Shervin has backed, why creators control the new media paradigm, and why Shervin

believes Bitcoin is a long-term systemic bet on humanity. I really enjoyed this conversation with Shervin, and I hope you do as well. Before we get into the episode, I want to quickly talk about our sponsors. The first is BlockFi. BlockFi has three products right now. The first allows you to deposit crypto and earn up to 8.6% APY in an interest-bearing account. That's an unheard of interest rate in the legacy world. The second, you can deposit crypto and get a US dollar loan.

And the third is you can buy and sell crypto on their new crypto exchange. I personally use the interest-bearing account. There was risk. I did the research. I invested. And I'm a happy user. So go do the same and check them out at BlockFi.com slash Pomp. again blockfi.com slash pomp and earn up to 8.6 percent APY on your crypto deposits in their

interest-bearing account the second sponsor is a new one and one that I'm really excited about it's called choice their new self-directed IRA product and if you're listening to this you're likely part of the over 7 million bitcoin owners who have retirement accounts with US dollars in them but not bitcoin I was in that situation too but now you can actually buy real bitcoin in your retirement account. I'm talking about owning your private keys and using tax advantage dollars to do it too. It's an absolute game changer. So go check them out at retirewithchoice.com or click on the link in the description. Again, a new self-directed IRA product that allows you to use your tax advantage dollars to buy Bitcoin and control your own keys. Absolute game changer. And then lastly,

don't forget that I write a daily letter to over 50,000 investors about business technology and finance. I break down complex topics into easy to understand language while sharing opinions on various aspects of each industry. You can subscribe at pompletter.com or go click on the description, link in the description. All right, that's it for today. Let's get into this episode. Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions of Morgan Creek Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy,

but only as an expression of his opinion. This podcast is for informational purposes only. All right, guys. Bang, bang. I've got Shervin here. I'm super excited to have this conversation, so thanks so much for doing it. Of course. Let's start with your background. You were not born in the United States. And you've got a pretty cool story about how you came to the U.S. and eventually got into the technology and business world. So maybe just kind of start back from Iran and how you get to the U.S. Absolutely. So I am a child of revolution and war. I remember bombs falling in Tehran as a six-year-old. You know, the bomb sirens going off, anti-aircraft shooting, red streaks in the sky. Everybody would go in the basement, you know, candles in the fear in

people's eyes. Um, my dad had to escape, uh, before us. Um, and so that was a pretty, you know, hard experience. Uh, he, I found out years later, uh, we were just talking about our dads and they're just say they're the greatest generation that they're they're so um humble about what they've done and they don't really talk about it but my dad worked for the shah and he um was head of radio and television for part of the country and so he actually made some brave decisions put foreign language broadcasts for embassies for people to know how to get out of the country um and he saved he saved lives i found out from people later like in the last 10 years people coming and saying you know your dad helped us um back in the day you know in 79 and so on

and um so he was put on the execution list by Khomeini and he had to go underground and hide and so we didn't see him and then one night uh it's a good story about karma which I think a lot about and he helped a friend of his from his hometown on the Caspian Sea who was from a poor family but a religious family the guy came and he had holes in his shoes and asked them for for a job for help and my dad gave him a job you know with him and then a couple years later somebody fired the guy without telling my dad and my dad found out reinstated him said you know don't touch this guy. He's, he's my guy. And, um, that guy ended up being head of security for the airport. So it's like out of Argo, right? So he comes and he's like, you're, you know, uh, reaches

out to my mom and it's like, your, your husband helped me a lot and I want to help. And, um, she checked with him that it was safe. And then, um, my dad got in touch and they met at column number four at the airport, and he walked them through security on the Air France flight to get out of there before he was going to be killed. So, I mean, life became very real and dramatic, you know, quickly. We didn't see him for two years, and then Iran-Iraq war started, and then me and my mom and brother and sister got out and met him in Washington, dc and started over we came with nothing so it's really like a american dream story i mean we're so grateful to america um we're all american citizens we love america and we wouldn't have

any opportunity without america and i think given you know uh it's very relevant in terms of you know the immigrant story and welcoming immigrants to america who rejuvenate the american dream and help build the economy a lot of the tech companies we know about you know uh almost the majority are started by immigrants and they create a lot of jobs and have a huge economic impact so you know that that's how we started and they just my parents really focus on education and so i just went from english for speakers of other languages i didn't know any english and then to gifted and talented then to a magnet school where i was lucky to you know uh get access to things like next computers and my dad worked overnight shifts uh and uh so

did my mom so they can buy me an apple 2c i remember that was my first computer a little green screen that changed my life and uh never looked back i've always been excited about science and research and technology and innovation from since I was a kid. Yeah. And there's something I think really kind of special about immigrants that are highly educated, very successful in other countries, and they come to the United States. And I think that you've said in previous interviews that your father started off as a cab driver, right? And there's this element of humility that goes along with, I have to start over or at least rebuild a life. And I always, you know, laugh and kind of tell friends, Americans discount that, but

Americans don't realize there's very few Americans who would do the opposite, right? Leave America, go somewhere else and kind of be able to start over again. They don't kind of have some of that humility. And it's an overgeneralization. There's plenty of people who could do it. But for the most part, I think that that's a discounted part of kind of the immigrant story is it takes a lot to swallow your pride and go from, you know, what sounds like high levels of government and kind of success to driving a cab, right? And kind of rebuilding from scratch. You know, every American is an immigrant at some point, right? In their bloodlines. Every one of us came here. And, you know, if you go back thousands of years, Native Americans came here. They migrated here as

well and so you know the American story is an immigrant story from the beginning it's a story of immigrants it's a story of bravery and courage you know and you know wherever you look at you know the first Americans to settle or you look at later generations of Italians and Greeks and Irish and and everyone that had to come here and wasn't welcome in some circles there were signs saying no irish need apply right uh so um you know every immigrant group jewish and so on uh arab and so on has had to and persian has had to come here and bootstrap from the beginning no matter what generation they came here and i think that's what really bonds the american identity um everyone still has that everyone whoever your

family came here 200 years ago all right uh or or five years ago uh that that is part of the the ethic of of what it means to be an american uh so i think that that's really what unites us more than divides us. And that's why I think entrepreneurship, and I wrote about this years ago, I was in Romania chasing a really an amazing developer who had developed a graphics engine for the iPhone back in like 2008, 2009, that enabled us to do multiplayer games over 3G. Apple hadn't even enabled that yet. And this young guy had figured that out. So I flew to Romania and never been before and met him, closed the deal. And we'd launched the most advanced 3D graphics engine and game on the iPhone. And when I was out there, I wrote about entrepreneurship. And I realized at

the time as I met this young developer that the American story had become global that entrepreneurship had become global that Silicon Valley wasn't a physical place anymore it was a mentality it was an idea and had gone viral and I I knew at that moment this was like 2008 2009 um i knew at that moment that the world was going to accelerate by the energy of that virality of entrepreneurship um that american the american story had inspired and you know and one of the things i realized is that we could be left behind right by that momentum if we didn't keep up. And that's where, you know, entrepreneurs like Travis or Elon and, and others who are builders, as Mark Andreessen, you know, rightly talked about, it's time to build. This is a time

for builders. This is a call to arms for builders. We can re-architect, rebuild everything, wherever it's our currencies, our financial systems, our health systems, our medical systems. Our government systems are, you know, all of the above is up for grabs, is up for people with talent and ability and drive and will and passion and love to like work and build incredible things. today like as we speak you know spacex is going to launch uh the first astronauts on on their rockets and that is a momentous a momentous achievement this is this is a private company that is now building the bridge for us to become an interplanetary species which is elon's goal and and that's the ultimate in terms of building right he's talking about building a whole new world a new planet and it sounds crazy but i would never bet against elon so you've obviously spent

a good amount of time with him and i think that one of the pieces that to me is very obvious is he, one, is misunderstood, two, because he is so ambitious and believes so deeply that he and his team can drive so much innovation, it's an easy target to attack, both in the media, in private, et cetera. Maybe help us understand a little bit, as you've actually spent time with him, what are your takeaways and how do you evaluate both him as a person, but also to those ambitions across spacex tesla uh and then we can get into some of the hyperloop stuff after that yeah well my experience has been you know incredibly um meaningful uh we've had some experiences like traveling together uh to to hear square to uh sorry to did you know he he saw a trip that i did

to to hear square in the middle of the revolution and then i went to libya in the middle of the revolution same trip uh with Sean Penn and we met with the rebels in in Benghazi as they had liberated like two weeks before Gaddafi was killed and it was an incredible incredible experience and he was like you know look next trip you take like that I want to go with you uh and I was like well we're thinking about going to Cuba and there was an American who was in prison for eight years there and um we were like you know maybe we could help with that uh and so we're basically doing hostage negotiations as ilan likes to tell it um and you know we coordinated coordinated in terms of what we were what our goals were and said you know and also the idea of like you know bringing helping

to bring internet to the island and we knew that bringing connectivity and communication to a country can really open things up and um and so that was the trip and it took six months to get the approvals and elon's jet was the second american plane to land in cuba in 50 years um and so we landed there and we met with ministers and we met with university students we you know now if you know Castro's son like you know with artists and one of the things we said is like look you know you've got to release this American there's nothing to talk about if you don't and within a year they released them and and then Obama opened up Cuba and Rolling Stones came in for a free

concert to half a million people and it affected change right and in that trip and Elon said that was his favorite trip at the time um we started talking about on the plane we started talking about uh Hyperloop and I remember you know everything kind of very clearly and I remember saying look you know what are you going to do with it you know what this was an idea um the paper wasn't written um and uh what he said was like you know he's got five boys spacex tesla solar city you know he's super busy and he didn't have time to do it he wanted to open source in anyway so i said you know do you mind if i try to you know create a company around it and he was like no go ahead and my idea was i didn't want to just do people transport i wanted to revolutionize

the idea of logistics cargo um and commerce and the idea was imagine if you could order something right uh online and it begins to be manufactured in real time uh manufactured distributed and delivered all within 48 to 72 hours from anywhere in the world imagine that kind of real-time pulse to the global economy and um and he was like that's a really good idea and i don't see any technical reason why you couldn't do people and cargo so that was that was a business model and i started to to work on it um and one of the things you you know to elon is one he's an absolute genius uh two he is incredibly loyal i mean uh he's a family person he loves his family uh he loves his friend you know close friends and he's incredibly loyal uh to those people

into his teams that are building these these incredible incredible companies with them um and i saw multiple examples of that and it was just you know in every experience there's a reason why people build great things with leaders and visionaries like that they are inspired they're inspired to do something more uh with their lives and to contribute something to the advancement of our world um and uh you know there's nothing better than waking up in the morning and realizing all these years of work that you're sending to human beings into space on a private rocket like come on how cool is that look if you see the um the kind of hype video if you will that nasa and spacex released today i mean you watch this thing and you're like again i tweeted a couple times

said, I don't know how you bet against these people, right? You know, whether it's Elon, whether it's the SpaceX team, whether it's NASA, just the fact that they have worked. And the part I actually wrote about this morning was this isn't something that they started working on two years ago, right? I mean, we're talking almost 20 years he's been working on this problem. And it started from a first principle standpoint. I got to fix this rocket technology, get the cost down. I have to kind of get cargo and then I can get people. And this is a multi-decade type body of work that we're just now starting to see, I think, where people say, wait, they actually may pull this off, right? But it's 20 years in the making. Yeah. I mean, everyone is praying for the safe

journey of the astronauts. That's incredibly important, obviously, to their families and and to the movement of uh humanity expanding beyond you know our planet um and you know i i was telling that story of having a conversation with elon in 2012 about humans going astronauts going on in his rockets and we were going to the opening ceremony of the of the olympics in 2012 and we got stuck in traffic we were going to be late and we saw some bikes for rem so we jumped out of the car and uh rented the bikes and biked and made it but then my uh my leg cramped as we were walking running um and he like put his arms around you know supported me to walk to a bench and then ran and got water because i was dehydrated obviously and we sat down we talked

and i asked him about you know when do you think humans will go on your rocket and he was so thoughtful his number one concern was the safety of the astronauts um that's all he was concerned about he was projecting like 2023 i think and he beat that but um but that was his paramount concern nothing else he wasn't trying to rush to get there and risk you know anyone's life um and there's always some risk no matter what you do but it's also an important reminder that look we put humans on the moon in the 60s right i mean wow i mean you know and and kennedy got up there and said you know wanting to put a man on the moon uh within the decade and they did it they did it with computers with the power of a calculator today um and it's an incredible

achievement but we should also understand that it wasn't just um just an engineering achievement it was a financial achievement and decision uh i think the numbers i saw once i wrote about this once about the the actual in kind of 1960s dollars that they committed to uh fund putting a man on moon within the decade was something like 250 billion dollars right and it was something like four or five percent of the gdp at the time and that's an incredible achievement you know commitment and achievement and so it's like we've already done this we we have these skills a private company hasn't done it our government and our people did it but companies have the have that skill as well and it's another area where where i talk about companies becoming

you know almost like sovereigns right i call them mini sovereigns and you know tim cook of apple has the power you know and apple has the power and financial power of of a nation state amazon John and Bezos, same thing. Google, right? And imagine in the SpaceX example, if Elon pulls it off and he colonizes Mars in the next 20, 30 years and begins to seed humanity there, which is absolutely his goal. again it sounds crazy but that is his goal and every crazy idea he's had guess what he did it from PayPal to you know to SpaceX to Tesla to SolarCity and so on so like you said I wouldn't bet against that yeah another founder that you spent a bunch of time with who I think has very similar qualities is obviously Travis and an uber maybe tell the story of when did you first meet

travis and kind of when did you become aware of uber as a company and start looking at it yeah i got um i became aware of uber super early um when it had launched and i was a fan and i was trying to get in touch which i didn't know him at the time so this was probably like 2010 ish um and it coincided with me becoming a venture capitalist for the first time so that that opportunity came to me and and um like i started june june uh 2011 and i chased uber and a number of other companies that i thought were going to be massive companies like airbnb and others um and travis was notoriously hard to get in touch with uh he wasn't going to answer some vc's email right um so i had to and he said this you know he said this before

he was like i had to i had to respond to sherman because i basically had everyone in his network who I knew and knew well vouched for me so they started saying to him like hey you should talk to Shervin and I'm talking about swarming not not not not like one person or two person like and you know it was everyone from like Julius Januszowski who was later the head of the FCC um you know to drew drew houston from dropbox to the list goes on and um so he did you know he finally responded um and i had told uh another friend of mine who was uh an investor in in uber that you know and on the board i was like look if if they ever raise money let me know or decide to take you know raise money and so he did me a favor the day of that board meeting he called me and he

said hey you know we're going to raise raise a new round and this is when uber was i think this was probably august september of 2011 uber is probably doing about 1.8 million dollars in net revenue had about six or seven thousand cars uh drivers on it um most of that was san francisco and like New York was like 1200 cars like it was tiny so I started chasing it and I was in the race I was hustling was doing everything I can to win and I got beat by another firm that I respect a lot but I Travis didn't he called me and he was like hey homie that's exactly what he was like he's like I really like you i wanted i wanted to go with you but i have to go to this other firm and i took it real cool i

was it was like i totally understand because as an entrepreneur i get it uh sometimes you have to make that call and so i said to him you know congratulations i'm happy for you i totally understand if anything goes wrong in the diligence or anything else i want you to know that i'm like a hundred ten thousand percent behind you so you negotiate with strength because you've got a back up and he was like i appreciate that and uh that was it and then i was giving a keynote in like tunisia for uh president obama's whole entrepreneurship thing in the middle east and i got a call on my cell phone and it was travis and luckily the signal was there i picked up and he was like hey you know you remember what you told me i was like yeah he's like is that still

on it was like absolutely he was like can you meet me in dublin there was this founders conference so i got on the next plane landed hit the streets of dublin had a pint with him in a irish pub and um as we were walking kind of the cobblestone streets at night he he told me his full vision that time and it was i'm not a taxi company i i you know i want to replace car ownership right and suddenly the tam or the total addressable market became you know trillions it wasn't you know and that's the mistake my competition made is they were comparing uber to a black car company or a taxi company and those comps are totally different than a technology platform marketplace that could also expand into many other areas like transportation food and so

on um and so that night um we agreed on a valuation of 290 million and people thought we were crazy you know uh me and my firm were crazy for giving that valuation but i went to you know i printed it out at the business center in the hotel went to knocked on his door and i have a picture of us signing the term sheet at the door um and we ended up putting you know 26 and a half million at 290 so about eight percent of the company um and it turned out to be a great investment and travis and i became very close i would say one super intelligence right like travis you know elon are in that category like top 10 that i've met um grit like real grit incredible willpower um just constantly thinking and working um and

they're both incredible recruiters absolutely i mean some of the best recruiters i've ever seen And Travis spends a lot of time recruiting and you look at what he did with Uber and then you look at what he's doing with his current company in the cloud kitchen space. And he's recruiting like crazy. He's, you know, and he's building a great company again and he's right again. Right. He's absolutely right about the trend. And he's building a really, really important part of that vision. And that takes that kind of incredible drive and commitment. And so when you get that phone call, you go to Dublin, how much negotiating is there versus, Travis, tell me what you want and we're in because we believe in you specifically. And we have this kind of deep-seated belief that you're going to build a successful company and the terms today don't matter as much. Like, is it something where you guys are literally sitting down, it's every single term is getting negotiated? Or is it more of, you know, what I call like the Warren Buffett deal where he says, Hey, look, basically, I know if I'm going to do, you know, multi billion dollar deal in the first five minutes on the phone, right? And yeah, I got to figure out the details. But but I pretty much know quickly, like, how did that actually go down? yeah i think you know the the other firm that one initially tried to reprice the deal which if you know travis you just don't do that and you know um i didn't know travis that well but my

instinct already was don't mess with that like you know if you give your word keep it and i'm i'm person of my word like if i give my word i follow through and that's why also a key part of why we became so close because we knew like when you're dealing with someone where there's no artifice right elon is exactly the same way there is no tricks they don't need to tricks are for people who are have a reason to do the trick right to get some advantage but if you work incredibly hard and you're super intelligent you don't need to rely on tricks you just build right and so we bonded because we knew when we were speaking to each other there was zero artifice and what we said we meant it and if we were wrong about what we believed at

the time we were open to being convinced that we were wrong and and then move on and i saw that in him like he might disagree with you violently you know uh or i might disagree violently but then you know after hashing through all the logic one of us would come out the other side agreeing with with the other if we weren't agreeing in the first place um so i think that's that you know that's part of it so i i think we got lucky too that we were in that situation where there was that repricing so i remember offering 290 over text because i went to like work on a term sheet talk to my team and and uh and then you know i think an iphone had just come out with a little bubble thing you know but so i was like i sent it and then i was waiting for him to respond no bubble

right and you know like oh crap like i'm like is he negotiating against me with somebody else you know or with the same firm using my offer to like you know get a better deal and but you know that whole thing about keeping your word you know luckily he came back and um before he came back i remember increasing the offer i was like 295 because i got nervous and uh he was like no i mean that's that's cool we'll stick to 299 and i think i 290 and then you know, it was the first time I think Travis has ever agreed to a lower price on his own. You know, so that was, so we went with 290. Yeah.

And so what's really interesting is Travis, Elon, there's many other examples in history is these folks are all able to go across industries, right? Obviously, Elon, there's similarities between space launching, electric vehicles, Solar whatever. But the most common aspect of those three companies is Elon, right? When you look at Travis with Uber, Cloud Kitchens, Travis. And so how much of these investments and the building of the companies is dependent just on who's driving the company versus picking the right markets or actually building the right products? You've invested in so many companies at this point. There's the argument that some people are founder investors, some are market

and summer product like where do you come out on that framework and what do you actually look for uh when you're making these investments yeah i was telling the story of my daughter when she was 11 i took her to her favorite sushi place and she was like that how do you how do you invest you know what do you what do you do and um and i i looked at her and i said you know i call it the love principle like you have to love the founder the team the product the market right and if you don't love any one of those things probably not a good investment and she looks up to me and she's like well I love great America and it was true she would go there every weekend we'd always go for Holly Halloween haunts and and and I was

like okay so you love great America like here's what you have to do you have to go there and interview and do what's called diligence interview the employees get her you know get get insights and she did that she came back she's like dad all the employees like love the company they love the ceo the company's called cedar fair the 49ers are doing a billion dollar stadium there and i was like there you go so cedar fair is a public company that's your first investment so she made 100 return and she's starting her own company now at 19 you know when she was 18 she started it um and you know she learned a really important lesson she's using the profits from that investment that she did when she was 11

to start this company but i tell that story because that is exactly how i invest like those are the four quadrants and if i have any kind of you know qualitative or quantitative reason not to believe in one of those things i'm not going to do the investment and for whatever reason that's been working i'm i'm up about 73x uh since 2011 which is amazing like i never first of all i never thought i was going to be a venture capitalist investor you know i'm immigrant kid poor kid like i just didn't i i just never i didn't think that was possible and i was surprised when that i started getting those you know offers and and um and opportunities. And so that, that formula is something, you know, that is qualitative and

quantitative. And some people are really good at the quantitative and some people are really good at the qualitative. If you're good at both, I think you can go in the pantheon of great investors in terms of track record and also in terms of just reputation amongst founders i think what you said about elon and travis is absolutely right like we look for great founders right that are building um industries like one of the things i say is like build industries don't just build companies. And, you know, that is an interesting juxtaposition in terms of some of the fissures you're seeing in the venture capital world versus, you know, founders. Founders are amazing founders, have a lot of opportunity to get funding and also can be picky and choosy.

And when you're not picky and choosy, you end up with bad investors on your board, on your cap table. And it is a nightmare. We've lived through things like that. And it can be an absolute nightmare. And so, you know, if you look at like Elon's story, like there were venture capitalists that when he needed the money in December and that 60 Minutes interview where he, you know had tears talking about that that that moment where he thought that his companies were going to die right that he had worked so hard and he put every dollar that he had into those companies to save them and he was living at his friend's homes and didn't have a house and and was basically homeless working on these companies having put every dollar that he made on paypal and

and um and his other startup there's a mapping company that he had started uh in his early 20s And so he took that kind of bold risk. And, you know, I think a couple of the VCs, especially one, bowed out, you know, at the last minute. And Elon, like, had to rescue the company. And I don't think he ever forgot that, right? And he never wanted to be in that position again, where his company could get killed. I think Travis has gone through similar types of journeys, and he's working on his company. I don't think there is a VC on that cap table, right? And so I think what's going to happen is great founders like Travis and others are going to fund other great founders. And founders are going to become more careful, right? If they have the luxury of choice, they're going to be careful about who and what firms and what angels, what investors they bring in. Because if you bring a psychopath into your company, you know, if you bring us, you know, someone that schemes against the company, for whatever reason, it can kill a company, it can destroy billions of dollars of value, and also hold back progress for humanity, especially with these types of founders. so it's it's an interesting branch of investing uh in entrepreneurship which is there aren't that

many of these types of founders right and i have a thesis that as entrepreneurship spreads and goes viral that we're going to find the elons of africa the travises of south america right like we're going to find um the undiscovered edisons um that are out there that have that talent but opportunity hasn't come to them because opportunity wasn't democratized and that's where we're at now and if you think about the next 20 years the next 40 years the you know people say disruption But that doesn't really cover what's happening. The speed at which these innovations are coming are getting exponentially faster. Look at blockchain and Bitcoin and what's happening. These are, to me, systemic bets, long-term systemic bets on the future of humanity. And when you back someone like Elon or you buy and invest in Bitcoin, these are two different types of asset classes, but they're long-term systemic bets on the future of humanity. and i'm into systemic bets those are those are massive bets those are those are like tam's

you know squared uh you know they they're the the the what's the total addressable market of a planet of a new world of a new civilization like what right uh and so if you think that big and you think intergenerationally if you think beyond your own life in terms of your investments wherever you're investing for your family institution yourself or so on you have to think long term and it strikes me that um once you see one or two of these work you almost become emboldened right so if you had never seen um spacex or tesla or uh uber or any of these companies actually play out you almost become more risk averse but

when you see them work you then start to think that way right you get that feedback loop of uh hey i actually want those market expanding technologies i want those founders who can think intergenerationally and so maybe talk a little bit about like because you uh have been so close to some of these founders who you know will go down as the best founders of our lifetime right? It's kind of where this is headed. And these companies end up being industry defining companies. How has that changed the types of companies that you invest in since you've been close to those people in those companies? That's a great, that's a great question. As you were saying, asking the question, I was thinking about it almost as

a hundred percent that that fear is what keeps people fear is what de-risks people's potential right and and so they in their mind when when when you make a little bit right and i remember when i remember when i made my first little bit of liquidity and i called my dad and i was like you know it was like you know it's first time i ever had any liquidity and it was like i don't know about four million dollars and this is like going from like nothing to like whoa i just sold a company i got four million dollars wow and i had never felt what fuck you money was until that moment i couldn't understand it there's no way you understand until you have it i swear it does it is a liberation of the soul right and um because at that point you can walk away

greatest negotiators have the leverage to walk away from the negotiating table right and as a negotiating table of life if you don't have that leverage you're trapped and you're willing to compromise beyond your comfort levels right but when you have that fuck you money it becomes a liberation point i called my dad i was like dad this is what it feels like i didn't know what that felt like right and guess what i put every dollar that i made into uber right so that was like that was the right thing to do because you know that's another 400x on top you're right like so that was the right bet but it but i was willing to kind of risk it all put all the chips on one thing and it could have gone really badly but it didn't right and

then it's like oh do i do i risk it again right do i make that bet again and that's where someone like elon that took every dollar and put it all into spacex and tesla and solar city that he didn't have that fear right so the antidote the antidote to fear um is exactly what you're talking about is that if you become attuned to the possibility of of a massive bet that you believe in and you're passionate about that's when you're willing to forget your fear it gives you kind of antibodies right makes you immune to that fear and if you're willing to take a big systemic you know bet it could turn out great um and it has in those cases yeah you you um obviously have been right multiple times and uh i've uh i've asked chamath i've asked uh mark cuban a couple

of others what were you doing uh when you realized that you had a billion dollars right so uh mark cuban said he knew exactly how much stock he had he was sitting he was just refreshing and refreshing and he described it as he went and did a naked dance, right? He was so excited. It's a little bit different, I think, with the venture capital side where everything's illiquid and it doesn't track kind of a stock price. So kind of what was that, you know, for you, like, do you remember what you were doing? And then two, mentally, you talk about kind of the unshackling, right? And you almost, it seems like can enter into a different mindset of what can I actually invest in? What do I want to spend my time doing? Maybe talk a little bit about going from nothing to

$4 million. It seems like one level. Then going from $4 million to a billion plus is a whole another level and almost like another level to the game, if you will. The thing I'm proudest of is that these investments have returned billions of dollars to a lot of LPs that are retirement funds of our grandparents and nonprofits that are doing really good work in the world. Like that, like my measure of billions is not what I'm acquiring, but how I'm contributing to the cycle of giving right and helping to fund um these incredible institutions and and non-profits uh pension funds that are the livelihood of humanity um that um you know put bread on the table of people's uh you know in people's homes and so that that to me is the most important part

And one of the things I've noticed is none of the great founders ever really gave a shit about money. Like once you kind of like, like that 4 million, that was the taste. It didn't make a difference. It was 4 million or a billion or 500 million or 300 million or whatever. It happens once. It doesn't matter wherever it was before. It's that moment, the mental switch, the unshackling, right. of your mind and the opening up to the possibility that you can do not just a 10x but 100x

right and in some cases thousands of x uh in terms of impact and one of my good friends peter diamandis one of the things he talks about is you know the true billionaire is about having an impact on a billion people and a positive one not a negative one and we see some great founders who build products that are inherently flawed in the impact they have on humanity um and you know i love facebook but i haven't been on facebook for five or six years um and you know and we've seen the impact it's had systemically and i believed in the early days of like the positive impact but i think from a policy perspective you know and now we're going through similar types of things with other platforms um but that we have to get ahead of those things you have to

have managed those those products so that you you continue to have positive impact at scale How do you think about that balance for a platform? So take Facebook, right? I worked there in 2014 and 15. And there was always this balance, I think, even internally of connecting the world is a great mission, right? And there's lots of kind of net positive aspects of that. It doesn't come without challenges, though, right? And we've seen that everything from on the election side and kind of all of that stuff to other aspects like just, you know, terrorist content can get shared and communication between bad actors and all of that. And so how do you think through that balance for platforms? And do you get to a point where you almost have to accept that there's some negative impact, but it's a net positive? And so we should, you know, kind of continue to encourage these? Or do you see it as, hey, we should work tirelessly to eliminate any negative impact and only focus on promoting the positive aspect? Like, how do you mentally break that down? Well, I think part of it is when you're generating tens of billions of dollars of profit off a platform like that, you become trapped to the engine of profit, right? And it blurs the lines of right and wrong, because you might make a decision that you know is wrong ethically, but is right for your profits and that's not that's that's the conundrum and when you're

at that kind of scale where you have a massive part of humanity on the platform the impact it can have is it can change sway elections it can you know lead to genocides and like you know and violence and all these things and you know it's unfortunate because in the beginning the reason why i went to egypt and libya in the middle of those revolutions is i was inspired by people like hemingway who went to the spanish civil war and actually he fought an invite i went to observe and learn and it was still scary right and um but back then i was like i wrote essays about this that that you know i said you know uh the last bastion of dictatorship is the router right and we have to you know if if if dictators can control the router they can

they can basically that's they can shut off the internet the mobile which is exactly what happened in places like libya um and and egypt um and but back then the impact of twitter and facebook on those movements was very positive so i was an optimist about it and i think the reason why Chamath and me and others have been persuaded that it's having an overwhelmingly negative impact is that something happened in between at that kind of scale where the moral compass became blurred um and and and so you know it's it's fixable it's just a matter of will and sometimes you know a company has to decide that it has to fundamentally change some things and that might mean that might mean short-term or medium-term even long-term compression of the

profits um but overall it will lead to a healthier ecosystem ecosystem within which to continue to scale yeah and then on these platforms we've seen um a complete uh rise of what i'll call kind of a new generation of creators right and you've tweeted quite a bit about uh this what i'll just called the creator class, right? And so a number of tweets that you've had, I just love where you're like, look, you know, Joe Rogan's a billionaire, Kylie's a billionaire. And this creator class is, some will call it new media, some will call it kind of influence or the influencer economy. But it's definitely something that wasn't there in the size, scope, or mechanism that it is today, even 10 years ago right and so maybe talk a little bit about like what is um drawing your

attention to that and how do you view that creator class um kind of in the world order if you will of what we're seeing happen yeah great question i mean i i um so i started going down to la in like 2008 i had sgm social gaming network so it was one of the first gaming companies social gaming companies on facebook platform and then on the iphone um and you know on the iphone where one in four iphones had one of our games and we merged that company with a company called mindjold and that's uh jam city now so they're doing it for like half a billion on the uh in revenue on the iphone now um and so i was going out la and i was meeting with people in that world in the the entertainment world um and i remember like back then i was saying like hey bring loss to

the facebook platform as a social game and you know it was hard to convince people to take those kinds of bets right because of that same conservative type thinking about platforms and taking that kind of risk but it was absolutely the right call to do right um you know same same pitch on the iphone and so on and then when i started investing i i um i started talking to friends of mine down there that i was having those discussions and i was trying to build bridges between silicon valley and and la um and some people got in some people were like i want 20 percent of the company and i was like sorry like that's not going to happen that's not how it works you've got to put some money into it you know invest just like everybody else

and help the company um but you know you're not getting 20 percent and so the we help change the culture down there to an investor class culture right to you know shareholder culture versus like i'm me and i i deserve 20 so that was important so you know conversations and meeting people like you know jay brown and jay-z or troy carter or scooter braun or you know adam lieber and uh ari emmanuel and bringing them into uber like those were the ones that were that got it invested and made a great return on their investment with with us into uber right and helped the company a lot and all of that um but then i think the legend of those investments is what changed the culture in la because the people who passed that i talked to

who i won't name right now but they they they were kicking themselves they were like what was i thinking why didn't i put in that 250 000 check and get a 400 x return whatever and you know ended up being so it's um that's one then between 2008 and now in 2020 the the evolution that's happened is that people now the influencer and the founders and the people have are the brands are the company and you know companies can live and die um but an influential person wherever it's a founder an entertainer and so on anyone that has an audience that's loyal and spends time with them similar to how you you do or rogan does and others do um you know have a chance to build something that impacts

billions of people and makes them billionaires right and so the power especially in terms of the new media paradigm is that you know these influencer influencers who are also great entrepreneurs can build incredible value for themselves their families their employees their teams and so on and investors um faster than in any other time in history What's driving that? Is that a technology inflection point? Is that a just mindset people now are thinking there's a different way to monetize this

or build these companies? Or is there something else that's driving it? It's the death of the middleman. Just like the death of the salesman. The middleman was a remnant of a different world. And all of the people that were in between these influencers and the audience and not just people but companies all of the agencies and the management companies and all these other things that were in the middle taking a cut even the

lawyers in LA get a cut of everything someone makes it's insanity it's you know a form of slavery and so you know I'm not going to get a lot of love from lawyers in LA but I mean it does make when i found out the lawyers get a percentage like you know agents and management i was like why like pay their fees and move on um but that was the mentality and the culture which then in turn made people desperate overestimating their worth and saying i want 20 in the company when it's like no no invest make a great amazing return and learn how to be a founder and build your own company so i think it's that collapse and compression where the influencer and their audience became one right like it's that trend that we just saw where

the young lady created a cult right you know the step step chickens or whatever it's called i think that's hilarious right but it's a genius move because she realized that if she could collapse the audience and she becomes the audience and the audience becomes her and suddenly she's a platform and suddenly the audience and the fans are a platform in unison right united and look what they did overnight top of the charts you know you know put out an app the ranking goes up all the comment streams of all these influencers suddenly same profile picture genius right what it reminds me a lot of is the old model was let's build a product or a service and then go spend a bunch of time money and resources to find the customers or the audience right so it's kind of company first

audience and customers second. Now, though, that's inverting, right? Actually, what's happening is people are building the audiences first, and then they're basically going back to the drawing board and say, okay, I've got this massive audience of hundreds of thousands or millions of people. What do I build to serve them? Is it a mobile app? Is it a merchandise store? Is it some other product, like a Kylie Jenner or whatever? And to me, that almost feels like if you can build the audience, it's actually a great way to de-risk the company building, right? Because you know that there's an audience there. And so you're drastically increasing the probability of the product market fit, um, in the future. The product market fit is the, is the person,

the brand is the person. And, and, um, I mean, talk about reducing cap, right? The customer acquisition costs. If, if, if you, if you have an audience and you can do what joe did and what daniel act just did together um you know that's the beginning of the end of any kind of middlemen in the media world and we already have experienced that in the tech world where the elons and travis's can create you know incredible world-changing companies on their own and then back others like them all right um or the the kylie can create a billion dollar company and she's what 22 23 years old or kanye can take his genius and design a shoe in yeezy and create a three billion plus company um with his creativity all right um and

And so I think, you know, that's, that's a trend that's not, it's not going away. It's here. And I think, you know, this, this new wrinkle, what, what it kind of inspired me around thinking through is ephemeral influencers, right? Like, you know, she might suddenly show up with, you know, a cult. Right. And suddenly have a million people following and being there, the platform, and it might go away and that's okay. You know, so it made me think of kind of like the Andy Warhol quote of everyone's going to have 15 minutes of fame. Right. um i think it's in this case everyone's gonna have 15 million dollars right it's like like she might make 15 million dollars right and that's a life-changing amount for her and her family but because she was creative about something and she basically created a new form factor within other platforms a platform within a platform and it might be ephemeral and go away and that's okay Yeah. And it feels like it's becoming more and more obvious every day as the more redundant kind of minute activities are getting automated away and software's replacing a lot of that work. The creative side of this is just getting exponentially more valuable. Right. And we're kind of seeing that just explode.

And so something like the Step Chickens cult, which is hilarious that literally the New York Times is writing about it, but they're writing about it because it's real, right? And it has serious audience, serious influence. We'll probably see a thousand more of those over the coming years. Absolutely. And here's to not just that, but here's to having a thousand Elon's bloom, a thousand Travis's, a thousand Steve Jobs. And, you know, I think that all of it, like everyone should rise and anyone that wants to be an entrepreneur has the opportunity to do that. And the only, there's no middleman left. And all of the most expensive parts of building these components continue to drop over time. And I think we've learned a lot of lessons over the last 10 years of capital is not, is not a guarantor of success or scale. just because you have a billion dollars to spend doesn't mean you have a billion dollars of scale those are two very different things i won't name names but we've seen a couple of companies raise a lot of money and uh and they don't go anywhere right and usually they raise that money before they ever launch a product and so that it's up uh can almost hurt you more right than actually just building the product to begin with before we wrap up i want to talk about outside of tech

uh, investing, what else are you investing in or what else are you excited about? Um, either before kind of the coronavirus pandemic or now as we're seeing some of the economic shocks, like, how are you thinking about the rest of your portfolio or your investing activities? Um, I, we care a lot about that as a family because we came from nothing and, you know, we have to give back. Um, and you know my children you know i have two kids uh and they care a lot about giving back as well and so does my my nephews and niece and um so we have them all involved um i'm lucky that my sister sarah is uh head of the family foundation the fish of our family foundation called pie like uh, PI and, um, and then the, we're trying to bring the same kind of systemic thinking,

but also, you know, innovation to what we're doing. So as an example, um, in this, you know, crisis and pandemic early on, I kind of latched onto the idea of, uh, using 3d printers and laser uh cutters to basically um 3d print you know masks uh face masks and and shields and and um and and so we kind of created a movement to do that called health os and we partnered with iry foundation and others and and we've now i think the numbers like we've delivered like something like 20,000 made and are delivering 20,000 face shields to hospitals here in in Florida in New York in Mexico and in other places and we can continue to scale that and you know it was it's been a really

cool project and Sarah has been helping scale that and those are the kinds of ideas we like. He also did something called the Cyrus Prize to kind of find, you know, young Iranian Americans who are, you know, incredibly smart and are working on big ideas and, you know, giving out a $100,000 prize to them. That's awesome. Before I end, I always ask the same two questions everybody the first being what's the most important book you've ever read wow that's a great question um you know it's like asking you to choose your children uh one over the other um i would i remember when i read heart of darkness by joseph conrad in my early teens it blew my

mind i just was like i just remember what an impact it had uh same with old man in the sea by hemingway it just those are stories that never leave you um stretch your minds uh so from a fiction perspective i would pick you know one of those if you were to make me pick one i'd say um you know heart of darkness um and then in terms of um non-fiction i would say you know i read burn rate back in the 90s and it and it had a huge impact on me and um you know It always made me remember that story. And that cycle has repeated itself so many times where people have raised a lot of capital and then forgot about their burn rate and burned too much capital and ran out. And capital is your oxygen and talent is as well. So you have to keep those two things in tandem in your mind and get ahead of it because you run out of both, you're dead. yeah those are two great books um and then the last question we spoke a bunch about spacex uh but what about aliens believer non-believer how do you kind of think through whether there

might be intelligent life out there that's a great that's that's a funny question um you know back to some conversations with elon in the early days um i remember talking to him well before everybody was talking about simulations and i you know and we would go back and forth on it and you know one of the insights was i remember saying like given almost infinite time everything that could have happened has already happened so we're already living in the future and you know um that from a scientific perspective i think i think that's a i mean it's even weirder thing to say than to say aliens are are are real but scientifically it could work out and and what what i mean by that is that if you have highly advanced ai and and some kind of

merger between biological life and ai if that's the future right and if we're already living in that future my insight was you know that what would any advanced intelligence want to answer and it's the fundamental question of when i was a kid i'd look up at the sky and be like okay everyone says god created this this world well who created god and then i would black out like that because that was such a scary thought that there was nothing and then there was something um so i was like look you know an advanced intelligence would want to re basically reverse engineer history through trillions of simulations and we might be living in just one of those stacked up against each other and to them it's a blink of an eye

right and you know the advanced intelligence would want mutants would want people who experiment who bend who bend the universe because it's it's the mutants and the different thinkers like like the Steve Jobs or the Addison's and so on who bend the fabric of the universe and one of the things you know people who have done that in our experiences i've seen this universally when we try to bend the universe the universe yields right and so um and it yields in the way it's supposed to yield if you understand that then it's a it's a core um generator of courage and allows you to not be afraid it's the antidote to the fear of taking risk because if the universe is going to yield

if you try um ultimately and you fail and you keep trying and failing you keep trying and it works in the end like edison's light bulbs he made 1800 versions of it um so my long answer to you is yes but a different kind of alien i love it and look i think ultimately it goes back to that unshackling of the mind right if you're able to uh to do that it's incredibly powerful um if people want to uh learn more about the work you're doing or the investing you're doing where can we send them uh to learn more um they can go to um pishavar.com um or shervin.com my first name or last name and um there's some info there and you know uh my email is just my name shervin pishabar.com awesome listen thank you so much the next elon or travis or steve jobs you know

let me know don't say that on the internet you're gonna get a whole bunch of trolls along with maybe one that might be real you know obviously we can't answer every every but but the swarming concept is a good one like you know i emailed travis he didn't answer but you know if you have people that i know like you that vouch for you then the probability of you know something happening and engagement and learning more is is uh is going to happen for sure and bend the universe i love it i love it uh listen thank you so much for doing this i think people will get a ton out of this and we'll do it again in the future really love your approach and framework of thinking