The Startup Ideas Podcast - How To Pick Startup Winners With Jason Calacanis

Episode Date: July 28, 2022

Are you ready to start angel investing? In today's episode, we share the secret to creating long-term wealth, explain how to become a “sophisticated” investor, and discuss the downsides of crypto. Hosts Sahil Bloom and Greg Isenberg are joined by guest Jason Calacanis, the creator behind the All-In Podcast, a serial angel investor, and a leading entrepreneurial author. Jason explains the entrance costs to investing, shares why people need to validate their research, and then everyone places their bets on this week's “hot” stocks.►► Want more community? Learn more here: http://trwih.comSPECIAL THANKS TO OUR SPONSORS►► This episode is brought to you by Wealthfront, a saving and investing app that can help you earn more on your money and build wealth for your future. The Wealthfront Cash Account grows your savings at 1.40% APY, and offers unlimited, fee-free transfers to your external accounts — plus, a ton of other features that help you optimize your cash. So, if your money is earning less anywhere else, now might be a good time to make a move.Wealthfront is offering Where it Happens listeners a free $50 bonus with a $500 initial deposit to a new Cash Account. Go to wealthfront.com/Happens to claim your $50 and start growing your savings.Cash account is offered by Wealthfront Brokerage LLC, Member of FINRA/SIPC. Wealthfront Brokerage is not a bank. We convey funds to partner banks who accept and maintain deposits, provide the interest rate, and provide FDIC insurance. Rate is subject to change. Investment management and advisory services--which are not FDIC insured--are provided by Wealthfront Advisers LLC (“Wealthfront Advisers”), an SEC-registered investment adviser.►► Did you know that one of the top reasons startups fail is bad hiring decisions? People can be unpredictable. And developers can be unpredicted, as well. Let Lemon.io take care of hiring your software engineers. They have a hand-picked roster of engineers from Europe, and we recommend them to companies we work with.Sign up at lemon.io/room for 15% off for the first 4 weeks.FROM THIS EPISODEJason Calacanis https://twitter.com/JasonSahil Bloom: https://twitter.com/SahilBloomGreg Isenberg: https://twitter.com/gregisenbergProduction & Marketing Team: https://penname.co/CONNECT WITH USNewsletter: https://trwih.comTwitter: https://twitter.com/_trwihInstagram: https://www.instagram.com/_trwihTikTok: https://www.tiktok.com/@_trwihSpotify: https://open.spotify.com/show/6aB0v6amo3a8hgTCjlTlvhApple: https://podcasts.apple.com/us/podcast/where-it-happens/id1593424985SHOW NOTES02:11 The Original Crypto Investor & “Sophisticated Investors”06:28 Crypto Tokens: Public Market or Scheme12:02 Where is Web 3.0 in Five Years?15:35 Breaking Ownership with Web 3.017:55 The Downside of crypto21:19 Default Centralized in a Crisis23:39 Free to Mint NFTs26:12 The Entrance Costs to Investing30:05 Being Honest on Upsides AND Downsides35:52 Validate Your Crypto “Research”38:16 #JTrading & Betting on Disney40:36 Super Forecasting and Creating Processes46:06 SNAP: Buy or Sell?49:19 BuzzFeed: Buy or Sell?51:34 The Secret to a $10M Net Worth: Index Funds55:26 Behind the Scenes with the All-In Podcast1:02:44 What Motivates Jason?1:05:08 Manufacturing Peak Experiences

Only invest in companies that have products in market and have revenue for your first 20 investments as an angel. So when you even see, if I'm getting friskin, I'm investing in a pre-revenue company, don't do it. Wait, just invest in all revenue-generating companies for your first 20 investments and then put the smallest amount you can in. If the minimum is 5K, ask if you can do two or ask if you can do one. I have people do that all time to me. They're like, hey, your minimum's 4K on this deal because it's 250 slots instead of a million-dollar allocation. Can I do one? And I'm like, sure, I do one.

I've had people ask to put $500 and you're in credit investors. I'm like, okay, you know, if we have room, sure. And I encourage them to like take their time and to learn how to do it. If you're keeping cash anywhere that isn't paying you a high interest rate, listen up. Wealthfront is a saving and investing app that can help you earn more on your money and build wealth for your future. The Wealthfront cash account gives everyone a 1.4% APY interest rate, which is like, like 20x the traditional bank's payment today. So if you kept $10,000 in a wealth front cash account for a year, you'd be on pace to earn an extra $140 a year instead of like $7 or whatever a bank would pay

you. That means that while your money earns 20x more, you can keep saving more, whether that's for an emergency fund, a down payment on a house, or your honeymoon to Italy or Greece. Talk about a no-brainer. And unlike your other saving options, you'll always have access to your money. money, thanks to unlimited free transfers, free access to over 19,000 ATMs, and no account fees. And if you ever want to invest with Wellfront, you can move your money into the market in minutes to grow it even more for the long term. Getting a cash account is super easy. It only takes a few minutes to sign up and then start earning that sweet, sweet 1.4% interest on all your cash. And if you start now, you'll get a free $50 bonus with a $500 deposit. There are already nearly half a million people using Wealthfront to save more, earn more, and build long-term wealth.

So why wait? Earn 1.4% on your cash today. Visit wealthfront.com slash happens to get started. Again, that's wealthfront.com slash happens. This no-brainer good news has been a paid endorsement from Wealthfront. Did you know that one of the top reasons startups fail is bad hiring decisions? people can be unpredictable, and developers can be unpredictable as well. Let lemon.io take care of hiring your software engineers. Why lemon.io? They test and interview every single specialist before offering

them to clients. Unlike many other sites offering remote software developers, lemon.io is sure they offer you experienced and verified devs. It's like hiring someone after your best friend's recommendation, but even better. Why? Because even the best friend can't offer you a replacement of the candidate in 48 hours or less if something goes wrong. But lemon.io can. You'll be working with hand-picked software engineers from Europe. They'll be a part of your team. Lemon.io's staff never intrudes on your communications unless you ask them to. Minimum bureaucracy, maximum efficiency. That's a win-win combination for developers and clients. So hire high quality, verified, vetted engineers from Europe with lemon.io and be stronger than 90% of startups on the market.

Go to lemon.com slash room and get 15% off for the first four weeks. Get there before your competitors will. Check out lemon.io today. Jump right in, man. Cold open. Cold open. I do want to start there, actually. It was actually what I wanted to ask about. because about a month ago or so, you tweeted something out. You said VCs having a liquidity path for crypto with retail investors is problematic. And you talked about what you talked about on the odd lot podcast, like this general idea that VCs were pouring money into these liquid tokens or semi-liquid tokens and then basically dumping that very, very shortly on retail at these massive markups.

And then retail was left holding the bag. I kind of pushed back because I was under the impression that a lot of these VCs were being asked to sign up to like, you know, two-year vesting schedules or something on these. And maybe it's just like my own naivete. But I'm curious to just like get your general perspective on that as a starting point of like, what are you seeing out there that's happening, you know, and what do you see happening in terms of the regulatory and legal landscape around that next? Yeah. So I'd start with we don't know what the VCs are doing. And to be clear, I'm not talking about any one VC firm, any one law firm, or anyone coin. So a lot of people are like, you're talking about Andreessen, you're talking about Salana, you're talking about this, you're talking about that.

I have been talking about crypto for over 10 years on the podcast. I was one of the first people to cover Bitcoin. I booked Bitcoin at like $2 or $200, and then again at $100,200. So I've been OG crypto for a long time. I understand the space. I'm not a code or a developer, but I generally understand what's going on here. and I've invested in 350 companies. So that's sort of where I'm coming from.

And I also run the largest syndicate in the world with 11,000 accredited investors, and I've done over 260 deals. So I understand the nuances, and I've learned this, you know, through a lot of hard work, how to deal with, you know, basically managing a large group of investors. And I have had to only work with accredited investors because, and I don't think that's the way the world should work. I think anybody should be able to with a basic license, like a driver's license, if you could think about it like that, become accredited. So I don't think accredited should be based or accreditation in the United States should not be based on your net worth because you

could be a trust fund kit and be considered qualified, you know, accredited and you could be like and have an MBA in economics and have written the book and teach it at NYU and be under 200,000 a year in income. So it makes no sense. The absurdity of it, too, by the way, like around accreditation that I just find hilarious is like I can't, if I'm not accredited in America, I can't invest in like my buddy's startup that he's creating, but I'm allowed to go invest in like a triple X levered, you know, mortgage ETAN through my brokerage account with no questions it has. And that's absurd. Like the risk profile of those is pretty different, I would argue. The intent is great. We want to protect people from losing their money.

It's, you know, we're talking about like decades old laws, like, you know, going on 100 years here, you know, when these laws were formed. So they obviously have to be reformed. And they are being reformed. You know, now you have a lot of exceptions that have been made. If you work at a venture firm, you can become sophisticated. If you have a series 67, I think, or something, you can be, I don't know all the nuances of it. But people are starting to get themselves accredited. It should be much simpler.

I teach a course, Angel University. I've done it 30 times. I give all the money to charity. And that would be a perfect proxy for people, and I would do it for free to help people get accredited. Because I do want to see people participate. So it's a long way of saying, I am 100% pro a sophisticated investor class emerging with a simple driver's license test. The driver's license test is not easy, but it's also not hard. If you put 10 hours into it or patty scuba diving.

I don't know if you guys are Patty certified. I'm Patty certified. You got to read a book. You got to take five exams. You got to do four open water dives. Seems reasonable to me. It might cost you $100, $200. That would be enough friction for people to be sophisticated.

And then they could invest in very speculative spacks or tokens or startups. All of these things are speculative. Right now we just tell them, go gamble in Vegas. So let's put all that aside so you just understand where I'm coming from because there seems to be like. Have you seen Matt Levine's, I'm an idiot test that he's written about in the past? No. Matt Levine, the Bloomberg writer, his idea around accreditation is basically you should just have to sign, everyone can be accredited. And all you have to do is you just have to sign a form that says, I know I'm being an idiot by making this investment.

Perfect. And you just sign it. And it's like, same general principle. You're like, okay, you're going to invest in something speculative. You just have to say, I know I'm being an idiot. I'm probably going to lose all my money on this. Totally fine. tongue in cheek, but.

It's tongue and cheek. But, you know, to be honest, I think that's suboptimal. I know some people are radical. it's your money, do what you want with it. The reason I wouldn't be in favor of that is because with this much money at stake and with a global market with no friction, i.e. crypto, these are all good things about crypto. You know, people could lose a lot of money very fast and there could be a lot of people who get harmed and people could be duped. And then you have situations where people are front-running markets and doing all kinds of crazy things. And people are not diversified and they're making

one bet, et cetera. So let's pause. We'll put all that aside. So I just want people to understand where I'm coming from. I am not a crypto-hater. I think that's a There's some interesting technologies there. But I do think 99% of the ICOs and crypto projects have never materialized into anything reasonable. And I think a significant portion of them have been built by either Gryfters, incompetent people, or some combination of both. Same could be said for some startups as well.

Right. But in startups, we give you the money after you've proven something, not based on, you know, some incredible idea. And we give you $100 million on an idea. And so what's happened in crypto. is I think a lot of VCs and investors and law firms have talked themselves into, and I'm no legal expert, so we'll see if they're right or wrong. It seems like I'm probably a little more right than they are at this point based on the SEC's actions, but they basically convinced themselves

that these tokens are not securities. The SEC seems to think they are. The SEC obviously could do a better job of making this clearer, but I think the SEC's position, I don't speak for them, but I'm just guessing here is, well, you've been a venture investor for 10 years, 20 years, 30 years, you've deployed a billion dollars. You've played by the rules this entire time in terms of who you take money from and how you deploy capital and all the legal work you do. And now you're paying a hundred times the legal bill to construct a foundation in Panama and then buy some tokens ahead of time and then get them listed on some markets and then sell them before the company has reached product market fit. But you wouldn't take these companies public that don't have product market

fit. And in fact, you told Uber and Airbnb to stay private until year 10 so that they were really ready to go public. So they basically figured out a public market, if you want to call it a strategy, some might call it a scheme, some might call it grift, you know, depending on how synithy you want to be, to clear out those positions. Now, we don't know, to your point, if people have cleared them out. But we do know that the bagholders are retail and largely retail, and that they bought these things, you know, like buying lottery tickets. And, you know, now you have the reality of a lot of people have lost their money. We knew that would happen. and everybody saw it coming.

And those people have a free option now. They made these bets. There was a murky legal environment. People convinced themselves that they paid a million dollars to get some legal opinion or to structure something in Panama or some Caribbean island, that this would all be fine.

Why did they spend a hundred times the price to raise this money and create these structures than they did for the ones that they were doing before? Why would they do that? Why would you spend a million dollars setting this stuff up legally? Well, you'd only set that up, I think the cynical view of it would be. You set up these structures. You paid all this legal money because you knew you were going to dump.

You knew you were going to clear these positions, and you knew it was going to be lucrative. That's why you went through the expense. Instead of just raising money, they could have done all these tokens could have just been sold to accredited investors only. That would suck. But you know what? That's what I do. I write a deal memo. I syndicate a 500,000 allocation incom.com to a couple of hundred, angels now over 10,000.

And if they want to invest, they invest on average. Back in the day, it was 3 or 4,000. Now it's probably 6 or 7. So I could have 25 times the number of people participating in my syndicate if they were not accredited. But I don't do that because I want to play by the rules. Would I like to have my mom or my cousins who are not accredited be able to participate? yes, but they can't. So I play by the rules. And I think that's what's going to happen now. Now that it's all come apart, just like we're seeing, you know, in the global economy, stocks, NFTs,

crypto, you know, any alternatives, real estate, pick the market. When the market collapses, everything gets stress tested. And I think this stress test is going to result in countless, and I mean countless lawsuits, hundreds of lawsuits. Because I saw this with the dot-com era. I'm not some like, you know, clairvoyant here predicting the future. You know, I'm not in Ostradamus here. I've seen markets collapse. Dotcom era. There were lawsuits for years.

What's your optimistic take, you know, five, ten years from now for Web3? I think you've spoken a lot about, you know, the fault of Web3 and there's tons. But I'm curious, you know, what does Web3 look like in five to ten years? All right. So Web3 is a collection of assets, right? People include blockchain in there. They include smart contracts in there. Distributed computing is in there.

Permissionless, you know, trustless, serverless, peer-to-peer. All that is part of this, you know, technology stack. So you're really asking, like, what are these 17? What's the future of these 17 technologies? I'll tell you, like, there are two things, I think, that are super promising, or maybe three, that I think could have legs. I think NFTs are a very interesting technology. when certain rights are attached to them.

So if I were to buy my Soho House membership or the battery or my golf club membership, and it was an NFT, and then I could take my golf club membership or whatever it was, and under some sort of smart contract rules, if I paid $25,000 to become part of my local golf club or $5,000 to be part of Sohouse,

I would have the right to sell it to somebody else, and I could get back up to 100% of my original investment, then 50% of any. any gain, and then the Soho House or the golf club got the other 50%. And the golf club had to approve the person and I had to approve the person. So both things had to be true. Or I didn't need their approval if it was over this amount, whatever it is. And so you could see that being like a very interesting way to do it where the golf club

is saying, hey, by investing in this, it's your right to do this. And in fact, we invested in a company and we bought two NFTs from After Party, which is doing this essentially making music festivals with this concept, right? and every time with my two NFTs, I get four tickets to their music festivals. So I was like, oh, wow. It's almost like I'm an original patron of Sundance or an original patron of Coachella. Like if you're a Sundance patron, which is a nonprofit, the Film Institute, you get, you know, like nice tickets and you get to go see movies and go to parties. So that's kind of interesting, right?

Did you know that one of the top reasons startups fail is bad hiring decisions? People can be unpredictable and developers can be unpredictable. and developers can be unpredictable as well. Let lemon.io take care of hiring your software engineers. Why lemon.io? They test and interview every single specialist before offering them to clients. Unlike many other sites offering remote software developers, lemon.io is sure they offer you experienced and verified devs. It's like hiring someone after your best friend's recommendation, but even better. Why? Because even the best best. friend can't offer you a replacement of the candidate in 48 hours or less if something goes wrong.

But lemon.io can. You'll be working with handpicked software engineers from Europe. They'll be a part of your team. Lemon.io staff never intrudes on your communications unless you ask them to. Minimum bureaucracy, maximum efficiency. That's a win-win combination for developers and clients. So hire high quality, verified, vetted engineers from Europe with lemon.io and be stronger than 90% of startups on the market. Go to lemon.io slash room and get 15% off for the first four weeks. Get there before your competitors will. Check out lemon.io today. If you're keeping cash anywhere that isn't paying you a high interest rate, listen up. Wealthfront is a saving and investing app that can help you earn more on your money,

and build wealth for your future. The wealthfront cash account gives everyone a 1.4% APY interest rate, which is like 20x the traditional bank's payment today. So if you kept $10,000 in a wealth front cash account for a year, you'd be on pace to earn an extra $140 a year instead of like $7 or whatever a bank would pay you. That means that while your money earns 20x more, you can keep saving more. Whether that's for an emergency fund, a down payment, on a house or your honeymoon to Italy or Greece.

Talk about a no-brainer. And unlike your other saving options, you'll always have access to your money thanks to unlimited free transfers, free access to over 19,000 ATMs, and no account fees. And if you ever want to invest with Wellfront, you can move your money into the market in minutes

to grow it even more for the long term. Getting a cash account is super easy. It only takes a few minutes to sign up and then start earning that sweet, sweet, sweet, 1.4% interest on all your cash. And if you start now, you'll get a free $50 bonus with a $500 deposit. There are already nearly half a million people using Wealthfront to save more, earn more, and build long-term wealth. So why wait? Earn 1.4% on your cash today. Visit Wealthfront.com slash happens to get started. Again, that's wealthfront.com slash happens. This no-brain

or good news has been a paid endorsement from Wealthfront. All right. And so the other thing I find pretty interesting is like Dow's. It's kind of interesting for a group of people in an LLC to make decisions together, but have it be programmed into it at the start and just have it running in the cloud. So as an example, it's a company called Pacas, which takes a home. We'll turn it into eight shares. We could all buy this home in Tuscany. They would provide all of the furnishings.

They would manage when we each got our weeks. And if we both wanted Christmas, they kind of have an algorithm to manage that. So it's fair. For the premium weeks, yada, yada, they charge you an expense. They get a little bit of a vig. But you actually own it, right? So now imagine that same scenario, but without a company, we buy the same beautiful, you know, farm in Tuscany. and we each own, you know, roughly 33 shares in 100 unit LLC.

Each two shares in the LLS in this Dow equal a week at the place. And each one has a cost of, I don't know, $2,000 in maintenance a year, right? So then I decide I'll sell four of them to a friend or a family member. They get two weeks there, but they also have to pick up the cost. You two get first ride of refusal on those shares, or you get first ride of refusal over 10 days. for half of my share, so if I want to sell the four, I have to share you four other ones, whatever we come up with as our concept here.

And it all just happens programmatically. And you saw some promising stuff where a lot of people would love to throw in some money to achieve some goal. And so that goal could be for us to have, you know, a farm in Italy. It could also be for us to buy the Knicks. It could be also for us to buy Twitter. It could be for us to save the whales or buy acre. courage to, you know, deal with the rainforest or a nonprofit instead of giving our money to some scholarship fund, we could say, we're going to put money into this to provide STEM education,

to disadvantage students. They apply. We all vote on each application. And you have 10 days to vote on each application to give scholarships to people, right? And then you don't need to have this whole nonprofit running the scholarship program. It's done through this Dow that everybody agreed to. So I do think there are promising things there. The things that I don't think are particularly promising or maybe overhyped is the blockchain as a database sucks. You know, everybody knows that. It's slow. And it's never going to get super fast, at least not when compared to, you know, modern day technology that doesn't have to, you know, be immutable and distributed.

So it's always going to run behind. Now, at some point, Moore's law will be so great that maybe any modern function would be fine on there. But this idea that there's no central authority is another thing that most people don't want. So most people who are buying into crypto would very much like to have their transaction reversed if it was hacked. Now other people see that as a feature. Like, ha ha, you made a mistake. You did it wrong. You lost your NFT.

Or you got hacked. Hey, it's on you. I think that the majority of consumers don't want that. So there might be some consumers who do. There might be reasons for wanting it, I'm sure. But I think most people do like to have some central authority. So a lot of the stuff is overblown. And I think the main problem as an ecosystem crypto has is it got co-opted.

The original true believers and the technology had very good ideas. I met a lot of them. I had them on the program this week in startups. But a lot of them got, you know, kind of diminished in their voice in this whole crypto ecosystem. as people came in just trying to secure bags and flip things. And that's really the tragedy of this, just like the dot-com era. A lot of the people who we were building the dot-com movement, we were building websites, we were doing it because we were enthusiastic about what it could do for society in the 90s.

We wanted to see people to have a voice and be able to publish things without permission. Like that was what it was about, you know, and to be able to communicate with people across borders. And then people came in and were just like, hey, there's a quick way to take a company public and secure a bag. So I think that's what's happened to crypto. Now, I was waiting for this crash. A lot of people I know in crypto were waiting for this crash. So hopefully it flushes out 70, 80% of people.

And then some regulation occurs. And then the people who are left are people who actually can ship product. There's been very little shipping of product. I also think the gaming space is kind of interesting. I like to gamble. I like to wager. I like prediction markets and stuff like that. So I do think there are some wagering and interesting things there.

You and I want to bet on the, I don't know, a Nix game where we want to play online poker. we put our tokens in, we put our Bitcoin at, we stake our Bitcoin, whatever. And, you know, if we lose a hand, the money just gets transferred and there's no intermediary. This kind of stuff is interesting, right? And so, or you and I want to make a trade on, you know, I don't know, what the price of oil will be at the end of the year. And, you know, here is our Oracle. We both agree that this website or this data service is going to be the proxy for the oil price. And we just make that bet, and it doesn't cost us anything, right?

The only thing that's problematic is, why isn't it all free? Like, weren't we supposed to save money on this? Like, the gas fees and stuff like that is just ridiculous. Like, if you're going to make this competitive, it should be 10 times cheaper than whatever the best deal is. So if Stripes 3%, this thing's got to be like 30 basis points. Like, it's got to be really competitive with what's out there. And it should be. But again, back to secure in the bag.

It seems like some people love to get these gas fees. And yeah, that's problematic as well. It just seems like, you know, decentralization. became this like dogmatic buzzword and to your point you know there's the real officinados out there that say oh yeah you lost your money you got fraud you know scam your platform got hacked whatever like oh too bad you know that's sort of the the price you pay and that's that's how it works you know not your keys not your not your coins and I just like my has that turned out to be true huh yeah but like my thing that I keep coming back to on all of this is

that centralization is good in times of crisis and like I think that across decision-making authority too. And so when you talk about DAOs, like I think a lot of the use cases you talked about are interesting in the context of a DAO where you have like, you know, governance across a bunch of people for like, you know, investing behind causes and homes or things like that. But if you're talking about a company, like there was this whole thing of like every company is going to be a DAO and community governance of everything. And my whole thing with that is like, that sounds fine when everything is up and to the right

and times are good. But when shit hits the fan, there needs to be a general that is able to go make quick decisions really fast. And I just don't think you can rely on a community distributed decision making in times of war. Default decentralized and default immutable,

default, you know, smart contracts, probably not what most use cases should be. So I think there was this like drunken, you know, fever about these coins because they kept going up and to the right. So people were like, well, if I'm making all this money, this has to be the winning strategy. The problem was the strategy was never executed. So we actually don't know. We don't know at scale if, you know, a crypto version of Airbnb where, you know, there is no central authority, you know, making sure your house doesn't get robbed or trashed, if that would be better or not because you would take out all those fees.

happy to see somebody try, but I don't think a marketplace like, you know, eBay or a financial service like PayPal or Stripe or, you know, Airbnb. Like, I actually don't think they work better. I think most consumers would pick the decentralized crypto version over the centralized trusted brand. People are underestimating central. I also think we saw a lot of bad actors in the NFT space. So the 10,000 PFP collection cookie cutter 0.1E, that cycle from 2021 to early 2022 and just that rinse and repeat that people were doing where NFTs, like we often forget, but NFTs don't actually need a, you don't need to sell NFTs at all.

So for example, I'm happy to see a lot of freedom in NFT projects take off. Like the 100 Thieves did a project where, you know, there are a popular gaming community. You know, they had 700,000 people mint for free, these NFTs to celebrate their championship. That's awesome. We don't need to sell it. So I'm excited to see more free to mint. And to your point... Yeah, I mean, it was like arbitrage, right?

Like, it was the same exact vein as what Jason was saying early on of, like, some of these VCs just taking advantage of an opportunity. to make a quick buck and like these guys came in and it was like yeah you could go make eight i mean there there was a point in time where this had to be the best way if you were like somewhat smart and you had very low morals uh it was probably the best way to make like five million dollars style you want to tell that story we had that we were you want to tell that story about our friends yeah i mean we we had yeah i mean we had a group of friends who basically had this idea where it was like um hey let's go we we have large platforms on on Twitter and social and let's go like you know this is a great time we can go create some amazing artwork and we'll build this cool universe and we'll go like create a project and we

originally like Greg and I originally started working on it thinking like okay yeah we can go create like this cool velvet rope thing it'll be a cool community we'll have like this type of utility around it yeah and then pretty quickly it became clear to both of us that uh our friends that were kind of you know, wanting to do it were really just like, there was no roadmap. It was just like, make a, here's how much we're going to make in the mint and then let's move on. And so Greg and I both like, like, pulled the plug on it and just walked away from doing it. And it never came through. Because I was like, look, I also, I mean, I have a small fund. Greg has a rolling fund. It's like totally unclear to me. And honestly, probably likely that like two years from a lot of these

people get sued or the SEC comes after you. And I don't want to get banned from, you know, for doing something stupid like that. It was like, it was ludicrous to me that that could possibly be worth the money. But I think a lot of people viewed it that way. You could just, I mean, you could literally make $5 million in like a month if you had low morals. I think anytime you, I've been introduced to some sort of investing space, you know, if you look at the tactics being used with the new entrance, that can tell you a lot. So if you come to a poker game, somebody's a fish, I'm going to get invited to a lot of poker games. All of a sudden, you're like, wow, I'm so popular. I got invited to this one poker game and then two people at that poker game,

I'm inviting me to these two other poker games. And when I was in L.A. And I was just starting to play poker. I was getting invited to all these games. I was like, wow, I'm super popular. And I was like, no, it's just bad at poker. Now, these are $200 poker games. It's like, nothing.

So people were just like, oh, he's a whale. He doesn't care. And, yeah, we can charge him, you know, $200 every night to learn how to play poker. And in fact, that's how I looked at it. I was like, yeah, I'm going to learn how to play poker. I'm just going to go to the Hollywood Park casino and buy into a tournament for $35. And I know I'm going to lose, but I'll learn. Great.

The problem is you wouldn't want to take that technique to the high-stakes poker games and buy in for $25,000, knowing you're in learning mode. You can literally learn for a thousandth of that equally well. So then you look at angel investing. People want to angel invest with me. They have to be accredited. I tell them to take the course. I tell them to read the book. The course is free.

I mean, you pay $300, but we give the proceeds to charity. So we just do that so people don't burn the seats. Your first investment is going to be $4,000 or $5,000, so it's nothing. It's literally giving a tiny donation to charity as an accredited investor. And then the book is essentially for you. I mean, books are 10 bucks or 20 bucks. I literally tell people, only invest in companies that have products in market

and have revenue for your first 20 investments as an angel. So when you even see, if I'm getting friskin, I'm investing in a pre-revenue company, don't do it. Wait, just invest in all revenue-generating companies for your first 20 investments and then put the smallest amount you can in. If the minimum is 5K, ask if you can do two

or ask if you can do one. I have people do that all time to me. hey, your minimum's 4K on this deal, because it's 250 slots, that's in a million dollar allocation. Can I do one? And I'm like, sure, I do one. I've had people ask to put $500, and you're in credit investors. I'm like, okay, you know, if we have room, sure. And I encourage them to, like, take their time and to learn how to do it.

Now, let's look at crypto. So in poker community, like they're trying to get more fishes and whales at the game. And you know what? So crypto are very similar. Have fun being poor. You don't get it. Okay, boomer. not going to make it, going to make it, you know, all this peer pressure.

I would say something like, you know, listen, Bitcoin is a great technology. It's been proven pretty robustly over a decade, but it will be replaced by a better technology. All technologies replaced eventually by a better technology. And man, the Bitcoin maximalists and then the toxic Bitcoin bros went crazy. And I was like, well, please describe another technology that after a 10 or 20 year run wasn't replaced. Oh, HTTP. Okay. sort of, maybe, but we do have AMP and other, you know, you know, extensions to it. But yeah, sure, maybe. Yeah, it happens once in a while. Please name another. You know, it's pretty hard to name, right? Maybe email, but a lot of the email communication has moved to chat and other places. So it's very hard to imagine that Bitcoin doesn't get replaced at some point. But that doesn't mean it can't have a 10 to 50 year run. But even saying that, man, it pissed people off. And I said, listen, Bitcoin zero is a possibility. What if it gets hacked?

What if it gets compromised? What if it gets banned? What if there's some denial of service style attack that we can't anticipate here, a Black Swan event? All kinds of things can happen, right? These things do happen. Oh, you don't get it. You're being taught.

You're a half-fund-me-point-J-Cal. And I'm like, listen, I've made seven figures on Bitcoin so far, and I'm saying this. I'm being intellectually honest. So I probably have a bigger Bitcoin position than the people who were in my replies, yet they're telling me I don't get it. I'm like, well, I bought it at three and $100 and $200. Now, I lost the $3 shares because it didn't have the keys in the website got compromised. I mean, it's just like being honest about upside and downside around these things.

And people, during times of overwhelming optimism, no one likes the person that is saying those things. Like two years ago, I mean, I just saw this on Twitter today, I think. But like a few years ago, you made the prediction that there was going to be something that happened over the coming couple of years that was going to, you know, destroy a lot of these startups that hadn't been thinking, you know, know about what could go wrong. And they were only thinking about a world where numbers go up, right? It's like the crypto saying numbers only go up. And that's, I mean, it's just an important thing, right?

Like you need to envision the possibility of failure. And then Joe from Oblots said, like, this is the stupidest prediction ever. And then David Sachs back in the day, and when I had written this in like, I think it was December of 2018, I said, listen, is your captain speaking, things can get a little rough here. I've never seen a bull market this long. Just make sure that you have a path to profitability. You got some good cash in the account and you're raising money at the top of the

market. All pretty, you know, in hindsight, great advice, but it's, it's, I don't give myself any credit for it. It's kind of simple advice, right? Kind of 101, to be honest. And sure enough, I was off by one year or 18 months. Yeah. Nobody can time it, but I was trying to, I was seeing exuberance that made no sense.

Like people putting $100 million, giving a hundred million dollar valuation to a company with no revenue and, you know, 4,000 VCs using the product. And you're like, okay, I think Clubhouse is cool too, but there's 4,000 people in here and it's worth $100 million, that doesn't make much sense. Okay, now it's worth a billion. It has no revenue. Now it's worth $4 billion. It's like, really?

Is this make any sense? And it obviously did not make any sense. And in hindsight, they're going to have to go down to a $250 million valuation and build back up. But they didn't go to the bag, so you've got to give them credit. It also kind of points to your earlier, the whole discussion around like, you know, crypto tokens and coins and how the, like, who was holding the bag on all that and how the VCs were doing that.

The other group that was holding the bag on this that I don't think it's talked about a lot was large LPs. Like a lot of these pension funds, endowments, insurance companies, etc. Are like implicitly holding the bag on this crypto stuff because these funds, a lot of the funds that went did that then marked up, you know, massively their initial investments and went and raised insane funds with huge fees. Like, you know, go and raise a billion dollar fund to go invest more with a two and a half percent fee at the top of a bull market. and now all of those pension funds, you know, who are like investing firefighter and policeman and teacher money are paying two and a half percent, like, exorbitant fees on, you know, investments that are going to be massively underwater or investing, you know, in a garbage market is these are the most sophisticated investors in the world. So, you know, I look at the stack

and I say, how sophisticated, how long have these people been doing it? Like these LPs of these funds, venture is but, you know, 5% or less. In some cases, it's ballooned up to 20%, 25% when venture is, you know, got big markups that can get bigger. But intentionally, they put it at 5%, sometimes 10%, depending on the aggressiveness of the fund. And they kind of know what they're buying into. They know it's cyclical. They know there's boom-bust cycles.

They know they can, you know, have a 20x fund, and they could lose 50% of the fund. They're kind of protected in their diversification. They, yeah, maybe they pay too many fees, but they don't have to. They have other places they can put their money. And they're choosing venture over private equity, and choosing crypto venture over venture,

over venture, traditional venture, over private equity, over real estate, over bonds, over commodities, or whatever. So I don't really worry about them too much. It really is like the consumers and then the unfairness of the trades that I think is what's going to result in the most lawsuits. Because what happens is, and I hate to be like the spoiler here, but just I always try to keep it 100, as the kids say, like be totally candid. There are a bunch of district attorneys. They all are running for some next office or keeping their current office if they're elected, not appointed. And they all have a lot of pride in protecting their citizens. So selfishly, they want to stay elected or they want to, you know, aspire to be governor or something. And, you know, being a DA

is a stepping stone. It's prestigious. Well, what's the most prestigious thing you can do? So take down Martha Stewart. It's to stop the mafia. It's to stop some crypto kids who absconded with the money. So you have to be a little bit self-aware here that if you screw over a bunch of people, you know, in some city in Idaho or Florida, there's going to be some DA who's going to be like, what? Seven people in my jurisdiction got screwed by, you know, BitConnect or, you know, whatever. I lost money on BitConnect. Yeah. Okay. So we're going to come at you and we're not going to stop.

And if I get that pelt and put it on my wall, I'm going to be able to say when I run for governor, yeah, and you know, all your friends who lost money in crypto, I was able to prosecute 17 people, just like, you know, somebody else running for over there. Oh, you know, I stopped online poker. You know, I stopped the mob. You know, Rudy Giuliani ran on, you know, having stopped the mafia in New York for a long time, right? So that's what's going to happen here. And it could be unfair, too. They went after people on Wall Street after, you know, Henry Blodgett famously was banned from ever, you know, working in securities for life because of a couple of emails, you know, where he was like, yeah, I think this company's a dog, but we have a buy rating on it. And, you know,

I don't understand. You know, like, it was like, okay, you know, that's kind of the modern day. And Henry is a delightful, great person, probably learned from that, I'm sure. I'm sure he did. And I'm fond of Henry as a writer and thinker, but. Is he the head of insider? Yeah, which used to be Silicon Allie insider. And you offered me 5% of it because I had Silicon All the Reporter magazine. And I said, no, you know, just keep it. So that was a stupid mistake on my part. It probably would have a couple million bucks. Do you, on all of this stuff, there's this one area I've been wanting to ask someone about, I feel like you're a good person to opine on it.

This whole like trend of people on Twitter, newsletters, podcasts, whatever, being like saying a bunch of stuff about some idea, you know, like recommendation, thing they're investing it. And then saying like not financial advice, do your own research. I think it's absurd because like I read, you know, there's like the crypto newsletters, right? Like, and I'll read it. And they'll do like a bull case on some crypto token. And then at the bottom in tiny fun, it'll be like, not financial advice. You know, do your own research.

I'm like, that's fine. You said it like, okay, maybe you're like covering yourself. But everyone considered that their research. Like they read that. That was their research. And the number of people that go and then. Yeah. And the number of people that go and buy the thing and then lose, I mean, like Luna, you know,

people recommending Luna to buy as like, oh, this super interesting thing. The number of people that lost money and like millions of dollars, obviously is that imploded off of like, you know, Twitter or newsletter or whatever. I mean, that to me is like an area that regulators need to look at. I think a lot of people are probably deleting a lot of posts right now. A lot of people deleting them. They're like, maybe I shouldn't have put that in an email and send it to a million people. It's sitting in people's email boxes. I think about that. I write deal memos, you know, and we do diligence on companies. We can, you know, and we're up front about this, like founders could lie to us. Founders could take the money and go to Vegas. They could go on a

vend. It could be incompetent, like really, you know, invest the least you can. And I tell people in my deal memos, the bet. And I use the term the bet because I want people to understand this is a bet. And I say, here's how I'm making my bet, just so you understand. And I frame it as that because we are making bets here. And so, you know, I just started j-trading. We came up with a funny name for day trading. So I think it's a unique opportunity to buy public equities. I've never played in the public equity space. I've always just bought index funds and I had a barbell strategy. I have index funds from Vanguard over here, wealth front, whatever, super conservative low fee and real estate. And then over here I have my really high, you know, highly variable

startup investing. And then I was like, you know what? I think the market's really low. I cover technology companies all the time. Companies I pick seem to have done well over time. I'm going to jump in. So I just, you know, earmarked a couple million bucks. And I'm now, this weekend startup's doing a J-trade twice a week, and I'm using the hashtag J-trading. And people are like, oh, my God, are you giving investment advice? I'm like, no, I'm actually looking for investment advice. And I'm telling people like, okay, I'm buying Stitch Fix. My first trade was buying Stitch Fix, and I'm like, here's my thesis.

I saw Bill Gurley buy a million shares. I know Bill Gurley. He's really smart. He's been with the company forever. Bill Gurley is buying a million shares. Sure, I'll buy my, I've about 5,000 shares. And then I was like, you know what? I think Disney is going to get to a billion subscribers.

I think that between Disney, Hulu, ESPN Plus, they're going to get to a billion subscribers. We've never seen a billion subscribers. That sounds to me a lot like an iPhone franchise. If they get to a billion subscribers paying money, that's going to be like, that's going to turn Disney into like Apple, I think, in terms of revenue generation. Just a thesis I have. Tell me if you think I'm wrong, because somebody's going to get to a billion subs. And I don't think it's Netflix.

I think it's like some, it's either Disney or HBO Max, you know, they're bundles. or whatever, so I'm going to buy some Disney. Then I see Netflix screwing up again, and I'm like, Amazon is the seventh best. Amazon Prime is the seventh thing on, you know, Amazon's plate, you know, like AWS, you know, Amazon Prime. There's a million things they're working on that are more important, probably, than Prime. And they're better than Netflix? Huh.

And then they just bought one medical, and they got rid of, they're getting rid of Amazon basics, so they can remove that attack vector for the, you know, regulators. Regulators. Doing everything right. And I've always wanted to own Amazon. So I bought some Amazon live on the air. And so I keep doing these like J trades. And I'm telling people, my plan is to hold these for 10 years.

I'm going to make it public. Every time I do a trade, I'll make a website eventually when I get to 10 or 20 trades. And you can just watch it. And yeah, maybe I'll lose 25% of my money. Maybe I'll be, you know, 50% better than market. But I like learning different disciplines. So I think I'm going to try to get to. to 20 different stocks, maybe a million or two million dollars, and then I'm going to try to

narrow down my 20 down to the seven best ideas. I don't know what you think of that strategy, but I always wanted to learn how public market investing works. That's kind of cool. This week and startups every day. So I'll get all this. Do it in the gauntlet. It's like being in the arena with it is the best way to do it. Funny story about stitch fix, by the way. I, I pitched. So I was like considering going into like the crossover investing or hedge fund world before I like ended up you know building my own stuff this is like early 2021 stitch fix was trading at like oh god no like 55 60 dollars a share and uh the case study i had to do for this one hedge fund was uh stitch fix and i had a week to like put together a whole thing on it and i pitched

stitch fix as a buy at like 55 dollars a share and you know now it's sitting at six and i think that's my blended price is six but i didn't didn't get the job uh needless to say but uh every like maybe like once every three months, I send a text to the partner who I'm still close with from that firm with a screenshot of the Stitch Fix price just saying, like, it's a good thing you didn't hire me. Well, but here it is. It's just cratered. I mean, this is what I think is great about what you're doing is there's a concept of like super

forecasting, not just forecasting, but there's a book super forecasting. Understanding why you made a bet and why you didn't make a bet and then doing a little debrief on those will make you better. So my thesis on investing is it's about process. So all I do is just try to refine my process based on what's changed in the market and what I'm seeing and then just being better myself. And so I have 11, I think 10 or 11 people on the investment team at launch now. We do about 70 meetings a week. Probably 50, 60 of them are introductory meetings.

And we invest in two companies a week on average. And one of them tends to be a follow-on. One tends to be a new. So we're getting down from 10 or 20,000 pitches to us and thousands of meetings down to 50,000. 50 companies. Wow. Yeah, it's pretty crazy when you think about it. And even then, I have questions about the investments I'm making and really try to challenge myself. And I have been, you know, writing the book was one way for me to clarify my thinking and maybe have a better practice. Because people did tell me, hey, dummy, this is wrong in the book or I think this is wrong.

And then investing in public like I'm doing with J-trading. And then writing my deal memos, all these things kind of keep me accountable to myself and my own thinking when I make a bet. and I really liked that. And Annie do coached me on poker one time. And she's like, okay, just we're going to play with the cards. I'm going to have you turn over your cards. Why are you playing 8-10? And I'm like, well, it's suited.

She's like, yeah, but you're under the gun. And being suited gives you like a 4% advantage. And there are these other players coming after you. If any, many hands are going to be better than 8-10. Are you going to defend this if somebody raises or if there's a re-raise? or if there's a re-raise or if somebody shoves it all in. I'm like, no. She's like, okay, so you're going to lose that blind.

Why not take the three hands under the gun off? Those are the hands after the blinds, first people to act. They're at a disadvantage than the last people to act. If you want to get cute and play eight ten suited when you're the button, okay, maybe. You only have two more people to act after you, the small and a little blind.

So maybe tighten your range and don't play out of position. Just like me, those little two adjustments to my game, all of a sudden I went from losing in, you know, let's say three out of four games and playing in these like underground or home games in L.A. To winning three out of four. And I was like, wow, just that little tweak.

Now, everybody else is doing that. So then there's a whole other series of things you have to figure out about the game. But just those two little tweaks changed my game forever. And I always wonder, like, when I'm investing, are there other little things I can do like that to just be a better investor? And I base all of my private market investing on the team, the product, and the customers. Now, you can become really inspired by a founder. and they've been trained on how to be charismatic now.

They've kind of unpacked what charisma is and how to sort of fake it. So it's quite theatrical at times. But you can't fake a great product. You can't fake the light of customers. So I've now, over time, leaned into those two things. But in the beginning, I was just, you know, this guy, Travis, I know him for a while.

And yeah, this Uber idea is great. Product is signed okay. The customers are over the moon about it. Oh, this guy, Kahn, you know, Alex from Kahn. Oh, yeah. Nobody will invest in this. It's a $4.5 million dollar valuation. They have $10,000 in revenue, and this guy created the million dollar homepage.

But the product's beautiful. And I talked to the people running the UCLA Meditation Mindfulness Center, and they told me they trained Kobe Bryant, Chick-Ill, O'Neal, and Phil on how to, when the Lakers were meditating. And that's when they won all their championships. And I was like, okay, I believe that meditation could be bigger than it is today when people go to, like, three different. places in LA to pay 20 bucks as a donation. And I made that bet on com, which people thought was a stupid bet. So I really looked at the customer base and the product now, but I've deprecated the charismatic founder because it's so easy to fake now, right? And so, and maybe someday you'll be able to make a beautiful app just by talking to Dolly, you know, and you're like, Dolly, make me a

gorgeous app that looks as good as Robin Hood, but for, you know, pick up basketball games. And every apple look stunningly beautiful. So then I'll have to... Yeah, but then Sam Altman will own it. So I don't know if we want to do that. Actually, I think they made that clear now. You own your stuff. And then somebody, I think I got an email from Reid Hoffman

that he was using Dolly to create NFTs. And I'm like, Reed, are you okay? I thought that was a bad dream. Is this Reed? That's real? I was like, Reed, are you a Burning Man? Did somebody give you some plant medicine at Burning Man? Are you okay?

Are you guys buying stock in SNAP at this cratered valuation? I just have to ask because it's down 30% or 40% today. What is the revenue? I would look at the revenue and then the price to sales ratio. And then I would look at user growth. Because if the users are still growing, and I don't know if they are or not, and the price of sales ratio is just collapsed, that means somebody could buy it.

And I think Evan Spiegel is a product genius. Like, he truly is. If you think about the things Zuckerberg copied from him, ephemeral messaging, lenses, stories, I mean, and glasses. Yeah, revenue is still growing. 20%. What is the revenue? I've got to understand the revenue growth.

Revenue's like $4.5 billion. What's the market cap? Market cap is now at, let's see 16 billion so they're trading at four times yep and down I mean you know

it's down 40% today their user growth if you look at the 5% their user growth is I don't know the number but it's like you know not huge and revenue is going to potentially go down

87% from the peak yeah but this but if we go back the last time they were $10 looks like 2020. And they were trading in that, you know, $4 to $10 range for many years. It kind of just round-tripped, the COVID round trip that a lot of people did, you know, like Peloton did the same thing. It's like, it's kind of taking that round trip. The next piece of data I would need to know to make a J-trade here

would be cash in the bank. How much cash do they have? And are they losing cash, et cetera. So if they're growing and they're four times revenue and they have they're not losing money and have enough cash this could be a non-consensus bet they've got about i think five billion in cash see this is what's amazing about these companies if you took the five billion out of the 16 billion dollar market cap yeah right so like if if you were to buy the company for 16 billion right now it would include the five billion dollars in the treasure so you paid 11 billion if they're making four and a half $4.5 billion in revenue is 2x, 2.5x, I guess, or somewhere around there. So they're trading at two and a half times their top line. Now, if they showed a 20% margin, that would be

$900 million, $900 million into $11 billion, they'd be trading at like 11 times earnings. So the P.E would be well under 15. So that's what I'm looking at. I'm trying to back into if they could, if they could sustain a 20% margin, if they cut a bunch of staff, they probably could. But, I mean, it's kind of hard to make $4.5 billion in the advertising world. I bet you Microsoft wants to buy this. I could see Google buying it too. I kind of talked to myself into a snap trade here. Should I just do a J-trade?

Yeah, I know. I was going to say, man, if you make this trade, you got to cite your source on it. I'm going to have to make a trade right now. I got another one for you guys. What do you guys think of BuzzFeed? Okay, I talked about this on this weekend startups. BuzzFeed is making $3 or $400 million a year on their run rate.

They only have $200 million in cash last time I checked. And they were trading at $1,400 million. $300 million. $2.80 market. $250 now. Okay. So BuzzFeed is a disaster. Their market cap is $250.

I think they have $100, $200 million in cash. They're losing like $50 or $100 million a quarter. So this has the risk of ruin. They could run out of money. Yeah. That is the key issue here. So you don't want to drop, you don't want to catch the falling knife in the middle of your palm, right?

And so this is going to get worse. worse and worse, and they'll get bought. But if you took out $100 million, you can't even take the $100 million in their cash, because they're probably going to burn that. But their P.E. ratio is $3.6. So did they show a profit the last quarter? I thought they were losing money. Or maybe they're losing money with stock compensation.

So this is an unmitigated disaster. Think about it. This company was privately valued at $2.5 billion, I think, or $3 billion. So it's 10% of that. You'd be looking at is somebody going to buy this? Now, what value and who's the buyer? It was talk of Disney wanting to own this or whatever, but it would be more like my guy, Jim Bankoff, who bought Weblogs Inc for me, would buy it to put it as part of Vox. Or he could buy it and then put Vox into it.

But, yeah, I don't know who wants to buy this. Journalism is a terrible business. There's no path to viral growth here. Every time you grow, in order to grow their top line, they're going to have expense. So if you want to get more page views, you're going to have to hire more expensive entitled writers as part of the BuzzFeed Union. It's a disaster of a business. Yeah, this could go to zero. So why would you put money into this as opposed to SNAP, which is run by a product visionary,

which has viral ability, right? So if we start comparing the two, it feels like I would much rather own Snap or Peloton. Peloton is a love product with millions of subscribers. And, yeah, I think I would even go Peloton above BuzzFeed. But I do like this, like, bottom feeding. I think it's kind of an interesting thing to do. Especially right now. I mean, there's just like, it's just even just as a learning opportunity, as you said,

it's like, you know, learning in public around these things that you're doing. It's a pretty cool time and opportunity to sit around and learn about these things, just given how much stuff is pulled back. It's like pretty, pretty interesting. Although I still agree with you that like if you're trying to just make money and if you want to like become worth, you know, $10 million in the long run, buying index funds, like Vanguard index funds, like Vanguard index funds at the prices that they're currently at is probably your best bet, just like dollar cost average into index funds.

I would advise people to just get Wealthfront. I had shares in Wealthfront as an advisor, and it's really the best product out there. And you can just set on a dial one to ten. I put all my family members on it. They all love it. They're all automatically setting like a $500 deposit or a $1,000 deposit every month. And it's a much better strategy for people, because you don't have to do what we're doing here. not everybody is in the middle of the tech industry with a bunch of smart friends who are making

bets all the time and who talk about tech every day and we've been in the tech industry for 20 or 30 years. You have to do these things when you have an advantage. Now I have an advantage in private markets. I have an advantage of poker. I don't have an advantage of crypto and I'm trying to gain advantage in public markets. If I wanted to go, if I wanted to be in crypto, I would stop investing in everything else and I would start a crypto startup and I would invest in crypto on the side. in the thick of it. I'd have 10 crypto developers and architects working for me, telling me which projects were coming. That's the only way I would be involved in is if I could have an edge. I only want to bet money on things where I have an edge. And the way I'm looking at the

million or $2 million I'm going to put into J trading is that's to get me the edge. That's my, that's my MBA. That's me paying for an MBA. It's cost of admission. That's my training. Now, I can't imagine in 10 years I'll be down. And if I'm plus or minus 25% of the index, has no impact on my life. So it really is me doing this as a sport and as an education. Much like if you bought, I don't know, if you bought a condo in San Diego because you love going there on vacation and you put it in the Airbnb pool, if you plus or minus the indexes or you could have optimized the apartment money better for your condo. But if you got to use it and you love San Diego, that's kind of I'm looking at the stocks. It's entertaining for my audience. It's educational for me.

Fuck it. I'm in. Yeah, and by the way, on Wealthfront, shout out Wealthfront, because I think they're actually the sponsor for this episode. Well, I mean, it's fucking great. Use the promo code twice to get 10%, get your first 5,000 fring. I'm hijacking your promo code. It's good. It's good. Love it. Do you read your own ads? What's that? Do you read your own ads on the show?

Yeah, yeah. I do the ad reads. I have to read 10 ads after this for next week's show because I'm going to go. Oh, man. So I want to ask you before we lose you. A bunch of, we sent out a tweet. asking what questions. I saw that. Got a lot of good, juicy questions. I think one of the ones that kept coming up was like this whole thing of like starting businesses with friends. And, you know, the pluses and the minuses of doing that. And like you guys have obviously had, you know, an interesting, you know, conflict recently with with all in crew and, you know, have built one of the

most impressive franchises in the world within the podcasting space and something really durable and interesting. Can you just talk about, you know, what went wrong? Like, what, what are the lessons around, you know, around doing business with friends and what you would advise young people that are going out and doing that. Yeah. I mean, I think it's great to start business with your friends and projects. I think you, looking at all-in, it's a very unique situation. You have four alphas who are at the top of their industries and who are the, you know, god kings of their realms. So it's kind of like, game of Thrones, you know, like, well, I have dragons. And the person's like, well, I have all the money and I got the big city and, you know, I'm protecting the north. Like, these are four

formidable individuals with opinions. And so, you know, Chamatha asked me to do, he said, hey, I want to do a podcast with you. I was like, all right, come on this thing. Start. So I want to do a unique one. Then we brought the two Davids on and it clicked and it became magical. And I really enjoyed doing it. And that's another area where like I really focused on being, instead of the host being like a really good moderator and challenging people, interrupting people, forcing them to explain the terms they're using. You know, and obviously I'm funny, and I make a joke here again, and so,

you know, I'm the funniest friend of the group who likes to break chops, and, you know, the other guys are pretty funny, too, on the margins. And so it's just got a great, you know, spirit to it. Then, we're like, we should do an event. We should meet the fans. And we're getting contacted by all the, you know, media companies. Whenever you something breaks out like it did,

it, you know, became like, you know, top 20 podcasts some weekends, you know, and we're regularly the top 30 episodes in the world. It's pretty nuts when you think about it. And so we got a lot of offers, but nobody can offer us money that would change any of our lives. And so we were just declined all that. Nobody wanted to do ads. I was like, let me read two ads. I could get 50K per ad. It's 100K. It's $5 million a year. And I'm the one producing all of this. And this is all built off of my company. I came up with the name. I came up with the format. I do all the editing. I mean, I do all the work, basically.

So then we did the event. And I said, listen, with the event, are we all going to do the work? They're like, no, let's do the event, but you do all the work. And then Freebird was like, I don't want you to get paid more money than me. And, you know, Freebird was complaining constantly, yada, yada. And I was like, okay, this is getting really annoying. Now I regret doing the All-In Summit. Now the All-N Summit then turns out people lose their mind over it.

It sells out. It makes a couple million bucks. You know, a couple hundred thousand dollars in profit. It could have made millions in profit, but we gave half the tickets to the fans. at a loss. The gift bag was $600. So we just spent all the money basically, like drunken sailors on these parties. And it turned out to be amazing, obviously. So then there was this talk of like, hey, we'll make it into a media company. We'll do more events. We'll build it up. I said, okay, great. If we're going to do that, and we were public about this on the show, then I think

I deserve just a fraction of more equity. Chimoth said, hey, what do you think that is? I said, I don't know. How about like two extra points? So I'll get 31 points. You guys all get 23. I'll be the CEO, you guys show up, I'll do all the work. And I have a 20-person team and half of them, you know, I've got event people already. So when we did this event production, I took 20 people on my staff and I put them on this for the last two weeks and, you know, I had three or four people working on it. So I basically took my team off of investing to do this. So anyway, nothing, like, so then you have four different opinions of what we should do. SACS is like, let's just do the podcast every week. That's it. Chimov has ambitions. I have ambitions. Freiburg has

anxiety. The whole thing was just causing chaos. And then we just decided, fuck it. We'll just make it a podcast every week. No more events. None of this bullshit. And we'll just own a 25% each. But we were negotiating and then everybody started losing their mind. And we know, we band almost broke up. But we realized like the audience really, we all came to the same conclusion. One, we love doing it together. Two, the audience loves it. And three, we think we're actually doing something important in the world. And that really, that third part, I think is the key for me. And I know it's the key for Sacks, Chimoth, and Freiburg. I can speak for all of them that we think what has click with people is that we're having better conversations and more intellectually honest conversations and first principle discussions.

And we disagree with each other, but we keep the podcast going and the friendships going. Sachs is like one of my best friends in the world. People think that we hate each other. we just, you know, have a difference of opinion about Trump versus Biden, Republican tactics, overturning Roe v. Wade. But if you look at the majority of things, and actually this episode, 88 that came out, I took the political discussion, which is very challenging, because half the audience gets pissed off when we don't talk about January 6th, and the other half gets pissed off when we talk about Roe v. Wade. So we're in this kind of like conundrum where, you know, people like, stick to your lane, do

markets, do startups, do tech, do science. But then, you know, like, we want to have discussions about other things, too. And so we're intellectually curious. So I basically broke down very intentionally this week. Instead of tribally talking about Biden versus Trump and DeSantis and all this bullshit, I just, let's talk about first principles like, what do we all agree on? Do we believe we should be fiscally conservative and that the government should stay out of our personal lives? Like, yes. Okay, so there's a starting point where that's about 80% of political decisions. Less government. You want to be gay. You want to be trans. You know, you want to have an abortion. You don't. It should be all your decision. Okay, gun control. Do we, do any of us have a

position? What should the position be? Like, and then what this always breaks down is, well, how horrible is Trump? How terrible? How senile is Biden? How terrible is DeSantis? It all becomes tribal. And then you start, like, losing the script. And so what I'm trying to do as the moderator is really get us to talk about the first principle stuff. And I think the podcast is really important. But I was going to put some more energy into the events and podcasts. I had an idea for another two or three podcasts that could have been offshoots of all in.

But they don't want to make it into a business. So I'm just going to do those independently. So I'm launching two more podcasts in September. One of them is going to be called Founder University. It's just going to be one time a week where we teach a founder, scale that we're already teaching our three portfolio companies, but we're just going to make it into a podcast. So it's going to be a very simple

podcast format, 15 minute lesson on how to grow your podcast. And they got a second one that's going to be a roundtable format but not with the original cast of Vesties. So think of it as like another superhero team. Because we have all these people in our orbit who want to come on all in.

They want to come on this week in startups, but this week in startups is about startups. It's not about crypto or politics or Roe v. Wade. And then we have all these people who would love to sit in, like Brad Gersner or, you know, Elon or whoever, you know, who have been on the pod, Dremon, you know, there's just this whole people in the orbit of All In and the orbit of This Week in startups and who are our other besties. But they can't be on this All In podcast because we show up every week. So I'm going to do another roundtable where I'm the point guard again. I really like that position and I'm really trying to be the best at it.

You know, essentially what I do is I try to add a new skill and be. really good at it. You know, I don't have to be the best, but 70, 80%, 90%, you know, be in the top 10 percentile of any skill, which is where I'm trying to do a public market investing and what I'm trying to do as a moderator. And, you know, it's getting noticed. I got a bunch of TV deals in the works where people are like, you're really good at moderating. You're not just a good guest. Would you like to do something on these other network, streaming, whatever, and what would that look like? And so I'm considering other opportunities. And All In will just be, you know, this one little thing. I wanted to make All In into something bigger,

but the boys and I decided we'll just keep it one thing. What motivates you? You have so much on your plate. You have a lot of things going on. You have all of these different businesses. You seem super curious still and excited about all this new stuff you're learning. Are you financially motivated to do all this stuff and you want to make billions of dollars? Or are you impact-motivated?

I've never, I've always wanted to be a millionaire and not have to worry about money like anybody probably wants. But I've never been like, I need this incremental amount. of money. I am playing for fun and joy, unlike the love of the game. And so when my friend Dave Goldberg died tragically, Goldie, who would play poker with us every week, I really reassessed my life a bit. And then when Tony Shea died two years ago, the day after my birthday, 18 months ago, on November 27th, that was a real gut punch for me as well, because we were good friends and played poker, and I would stay with him. I was in Vegas and stuff like that. And That was very tragic as well.

And I just reassess like, okay, let's just, what do I like doing? And I like talking and doing podcasting. I like performing. I like writing. I like investing in companies. I like building products. And it turned out I also liked doing certain activities, which I never really did because I was so busy working.

So I turned out, I like skiing a lot. I was talking to a friend. And everything I described to them of what I like doing was in service of other people. And he's like, you realize like none of this is. like for you and your joy. And I was like, yeah, that's kind of interesting. I do the pod. I get joy out of it, but really a lot of other people get joy out of it. It keeps people employed. I do investing. I do get joy out of it. I love building companies, but it's for helping other people. And my friend was like, what do you actually really love yourself? And I was like, I love hanging out with my friends playing

cards. I love skiing. And so last year, I bought a ski house and I skied 40 days, which was more than I skied in the last 10 years. And I was like, you know, I kind of been interested in this mountain biking thing. So I just bought like a $9,000 specialized e-bike. And I went four times this last two weeks up here in Tahoe. And it's incredible. And so I'm trying to hook you up with some mountain biking gear if you're, if you're interested. I'm on the board of Fox Racing, which is like one of the biggest mountain biking brands. I just bought their knee pads and gloves, I think. Oh man. I can hook you up if you want anything more. No, no, I don't take freebies. I always like to buy stuff. I hate taking freebies. You can pay. You can pay full.

I'll just get you the best up. I like to pay. But anyway, so that's really what motivates me. I really like, I've come to the conclusion that at the end of your life, it's a bunch of memories of like these peak experiences, victories, failures, whatever. And as best I can tell, that's what makes a good life is like these collections of these peak experiences that you laugh about when you're friends. And so I'm just trying to actually manufacture more of those incredible peak moments with my

kids, with my wife, with my friends, with my business colleagues. And just with everybody, you know, and I'm also trying to figure out, like, how to spend money to increase my joy, which has a poor kid from Brooklyn who grew up Irish Catholic. It was, like, really against everything I'm about. So, like, buying this $9,000 specialized bike or buying the ski house that I bought, like, if it was five years ago or six years ago, I would have suffered immensely about making those purchases, even though I could easily afford. forward them. And now I don't suffer over them. Like I just told my chief of staff, go test drive. He's a jock. And I was like, just test drive all the bikes, whatever the best one is, figure out the consensus, and just bring it up to the ski house and find me an instructor. And boom, here I am. I got an instructor. I'm going to start going on lessons. I did a couple rides on my own. And, you know, great. And talk about peak experiences. I came around a

turn on a trail. I went out with my friend Ryan Block, who was one of the editors. And I consider I'm a co-founder of Engadget. And he took me on this, a great trail in Tahoe. I decided I'll go do the same trail. I go out at Twilight. I come around to turn, 20 feet in front of me, a giant mountain line. I slam up on the brakes. Mountain line turns around, stares at me for five seconds, and then walks off indifferently.

Oh, my gosh. I can tell you, this is one of the peak experiences of my life. Peak experience as in the, I've had some scary experiences in my life, you know, having grown up in Brooklyn and been in some pretty crazy bar fights and whatnot. scary moments. This was probably top three most terrifying moments of my life. The blood came out of my body

to have a predator stare at you for five seconds is like nothing I've experienced in my life. It never had a predator stare at me for five seconds. And it was beautiful and gave me the, you know, brain chemistry rush.

I don't know what got released in my brain. But I just thought this is how it ends. I'm literally going to spend my final minute or two on the planet. My final moments will be trying to survive an attack from a mountain lion. It was pretty terrifying, exhilarating, and freeing in many ways. Because I've been contemplating my own mortality, because I'm 51 now, and two of my friends died in their 40s, tragically. And you start thinking about like what do I want to get out of the last 20, 30 minutes, days, years, weeks, quarters, I don't know what I got left.

Now when you're 20 or 30, you're kind of on adrenaline, you're not thinking about that. But when you get to 51 and you start to have a couple of your friends go, then you're like, ah, man. How old are your children? I got to squeeze some juice out of every single orange and I got to enjoy every sandwich. Like every sandwich counts. Like just every bite you take, just enjoy it. It's a blessing.

It's a mitzvah. How old are your children, Jason? So I have two six-year-old twins and a 12-year-old, all girls. And it is the greatest joy and most fun you can imagine. So when I'm up here in Tahoe, I get this window where I take them for every day or almost every day. And I don't let people book stuff on my calendar. And I've been just taking them to the beach or on a hike or for a walk to dinner and ice cream. I give my wife a little time off so she can work on some of her projects.

And it's just been incredible bonding. It's like been this like dream summer that I never had as a kid. parents had to work because we were barely middle class and always behind the April in terms of finances. So, you know, my summer was leave the house at 8 a.m. You're not allowed to come back until 5 or 6. Keep yourself entertained on the streets of Brooklyn or whatever other borrow you can get to on $20 with your true brothers. So we had a pretty raucous childhood. But that's just been delightful. I'm like, I'm living some crazy fantasy where I'm by a lake and then getting ice cream cones and walking our bulldogs with these three wonderful children who are laughing. and joyful and falling asleep in the car with ice cream on their shirts. I have felt that recently for sure.

I know. I really wanted this childhood, but I'm living it now, so it's great. I have a two-month-old, our first little boy. I have felt that exact thing of like every morning. It gets even more interesting. And from like 9 to 10, we go out on a walk in the neighborhood, my wife, our son, Roman, and I, and I was walking around one day, and I was like, it was some. It was like 75 degrees and I was just like this holy shit you know life doesn't get much better than this moment right here

You know and you don't need more money. You don't need any anything else. It's like in that moment everything is enough It's a pretty amazing and it gets more interesting and it's a boy. So yeah, I grew up with brother. So it's I understand the fun of that What's great is you just sort of click into this wonderful You click into this wonderful moment where you get to relive your childhood and experience everything again so my wife's like

oh this house I bought this was like the reason I bought it I'm in a movie theater right now and like I love movies and I take I was taking my 12 year old to the movies every Friday it was kind of our tradition and I've just been a fan of cinema my whole life I wanted to be a director or run a movie studio in another life and I was like you know my wife was like can you pick

a movie time. I'm like, yeah, I'm just going through all the great movies of my child, and I was like, what about Bob? You know, I love, like, that's an incredible movie or, you know, anything Bill Murray's in is great. So now my kids are old enough and we watch What About Bob? If you haven't seen that, it's like the perfect summer movie because it takes place on an island in the summer. Bill Murray, Richard Dreyf is hilarious. And so you get to experience all those things again. So with your two-year-old, you'll at some point be like, hey, you want to read The Hobbit or watch Lord of the Rings or can I introduce you to Star Wars

or Jurassic Park and all of a sudden you just get this incredible or can I teach you how to ride a bike or you know let me teach you how to cook and you know all these things start happening that you get to relive for yourself and it's like something very primal and joyful about it.

I'm enjoying a tremendous thing. Be present as much as you can. I think that's a great place to wrap up. You've been so, so generous with your time. Of course. Really, really, really appreciate. it. And a lot to chew on and a lot to continue learning. I mean, if anything that I... Have fun, folks. Work hard and have fun. Yeah. Yeah. I mean, just keep being curious, man. Your curiosity

really shines through. So super excited to see all the stuff that you continue to build next. And we'll be following along with whatever it is. So thank you so much, I appreciate it. Thanks, boys. Thanks, boys. Let's do it again in here. Thanks so much for listening to today's episode. If you have any questions that you want featured in a future episode, email us at high at t-R-W-I-H.com. Leave us a review at Apple or Spotify to help us grow the reach of this podcast. Until next time, we will see you soon.