The Tim Ferriss Show - #689: The Brothers Who Live One Life — The Incredible Adventures of David and Daniil Liberman

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Starting point is 00:01:53 and the same 100-night trial as the rest of Helix's mattresses. Helix is now running their Labor Day sale, which you can take advantage of until September 10th. Get 25% off on all mattress orders plus two free pillows. That is very significant savings. That's 25 off because of their Labor Day sale. So check it out. Go to helixsleep.com slash Tim. One more time, helixsleep.com slash Tim. With Helix. Better sleep starts now. This episode is brought to you by Protects Rest Supplement, a new take on getting deeper and more restorative sleep. I was introduced to this by former Navy SEAL, Nick Norris, who has been on this podcast. And as a mutual friend of ours put it to me, it's very annoying that Nick has no physical weaknesses.

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Starting point is 00:04:09 a shot and check it out. That's protect, that's P-R-O-T-E-K-T.com slash Tim for a free bottle of Clarity with your purchase of Protect Rest. One more time, P-R-O-T-E-K-T dot com slash Tim. Optimal minimum. At this altitude, I can run flat out for a half mile before my hands start shaking. Can I ask you a personal question? Now would have seemed an appropriate time. What if I did the opposite? I'm a cybernetic organism living tissue over metal endoskeleton. The Tim Ferriss Show. brothers, David Lieberman and Daniel Lieberman. They're both entrepreneurs and investors,

Starting point is 00:05:06 one-of-a-kind entrepreneurs and investors with a close partnership spanning 16 years. They gained valuable experience at Snap, contributing to projects involving avatars, Bitmoji, animation, and product operations. They are currently based in LA, where their primary focus is on building product science, a service dedicated to optimizing mobile apps. I'm going to pause here and just say there's a lot more to this story and this conversation than the bio I am reading. We get into crossbows. We get into Russian mobsters. We get into some of the craziest stories, honestly, I think I have ever heard. So take everything I'm saying as just a preview of one

Starting point is 00:05:42 dimension of 17 dimensions that we will share. Moving on, the Lieberman Brothers have established the Lieberman's Company, referred to as a people company, through their commitment to the Founders Pledge. They've allocated all future earnings and economic value for the next three decades to Lieberman's Co., including founder shares of product science and potential returns from future investments. Some of you may recognize the Lieberman brothers from a fascinating profile in The New Yorker on selling shares in yourself. What might that look like? What can that look like? What might it look like to invest in other people for their future earnings, etc.? They have a lot of wild ideas, a lot of great ideas, and you can find them online at Liebermans.co. That's spelled L-I-B-E-R-M-A-N-S, Liebermans.co.

Starting point is 00:06:30 You can find them on Instagram at Liebermans, so L-I-B-E-R-M-A-N-S, and there's a lot in the show notes. There's going to be a lot in the show notes here, so be sure to check out the links after the episode at Tim.blog slash podcast. And without further ado, please enjoy this very wide-ranging conversation with none other than the very one-of-a-kind, unique Lieberman Brothers. Gentlemen, David, Daniel, if I'm getting that right. Nice to see you again. Nice to see you. So where did you grow up?

Starting point is 00:07:12 And what did childhood look like? So the two of us were born in Moscow, still Soviet Union at that time, to a family of the very known neuroscientists, biophysicists, who, like, the family were sort of, like, upper-middle class for the Soviet measure. But as soon as the Soviet Union collapsed, with the Soviet Union, the family collapsed to the below-power type of situation, because our dad was born in 1925. So in 1990, he was pretty old already

Starting point is 00:07:45 and Dean had a chance to adapt to the new reality and it was six of us elementary school kids so a complicated situation both of parents had to continue the work as they wanted actually to finalize

Starting point is 00:08:02 and finish the work of their life and at the same time somehow survive and feed kids and like get some clothes for us and stuff. And it's like six of us, uh, one year apart. Our mom was, she was busy, busy, busy with making her breakthrough works in how neurons works and the signaling system in the neurons at the same time, having six of us in eight years, less than in eight years.

Starting point is 00:08:30 How does any human do that? So let alone a mom, you know, not to get us into all these confusing gender waters, but let's just say for the time being, mom, primary caregiver, would that be fair to say? Yes. So how did she manage both the scientific exploration with this groundbreaking work and six kids i can barely manage one dog as they always what qualifies as my job so

Starting point is 00:08:52 how did she do that i think that after the fourth one we kind of a little bit managed ourselves right but still it's not the answer or the question. No, there was a grandma and grandpa from time to time. So from time to time, they would drop half of us at the grandpa and grandma's place and then took half of us with them to the laboratory. That's how we were surrounded by the fish and snails. We were surrounded by all this equipment. Lasers, microscopes lasers they got first PCs much earlier than anyone else

Starting point is 00:09:29 that's why we also were quite excited about that and I think that in general they were super passionate about their work that's what we definitely picked from our parents and about each other so there were six of us

Starting point is 00:09:43 it's a full team, team yeah it's a full soccer team so you have lots of excitement maybe lots of chaos you have goldfish snail grandparents lasers sounds like a pretty awesome setup for curious kids curious kids honestly and what did you pick up on intellectually as a way of thinking from your parents? And I ask that because I know both of you, for instance, and I'm not trying to lead with this question, but pay a lot of attention to data. You're sort of geeks for parsing the data, whether it's to refine how you think about or identify problems, and then also how you might solve problems. What did you observe in your parents or pick up from them when it came to how they thought about things?

Starting point is 00:10:28 Now that you said that, I realize that our parents were doing those experiments, which required them years of repeating, repeating, repeating, repeating the same stuff. Like trying to get data which would make sense on top of their hypothesis of how everything works. So I guess we've been surrounded by the piles of papers with just numbers. Literally, I remember this. And you know, how was it called? The cards.

Starting point is 00:10:57 The perfect cards. Oh, like the punch cards. The punch cards, yes. The punch cards. Like everywhere, the punch cards. Like everywhere, the punch cards. Before the PC was there, there were like this huge type recording machines with all this data as well. But what's interesting,

Starting point is 00:11:12 both of them was always challenging the status quo of the current understanding of science. So if just someone claims something and you cannot really prove it for yourself with data, probably something is missing and you cannot really prove it for yourself with data probably something is missing and you need to dig deeper and that's how they lived and they had their own discussions with everyone around and we sort of picked it up as we were growing already like i don't know 15 ish years old our dad was even older so he needed someone to escort him to the conferences and like meetings of scientists

Starting point is 00:11:47 just basically like it's moscow and winter and the roads are icy i don't know five six months a year like something like something like this so he needed someone to basically help him get there and being there all the time we saw his conversations with the rest of the scientific community in his institute. As they were just like laughing out of nowhere. I mean, just like, oh yeah, of course. Like, again,

Starting point is 00:12:15 Lieberman is talking about the quantum nature of the consciousness, blah, blah, blah, blah. Something like that. And we were like looking at this, it's like, why? He has some ideas and proofs so it was sort of uh resistance resistance to the rest of the world we felt his resistance and we

Starting point is 00:12:31 like were challenged with this as we're like oh we're gonna prove everyone lieberman's against the world lieberman's against the world exactly all right so we're gonna leapfrog from that as far as the next logical place i mean i like hopping around because i see things on paper i find certain things exciting to talk about and then we can fill in the gaps so i'm just gonna actually answer my own question and i'm gonna take you to around and then we can fill in the gaps as we go. So you're around 18 to 19 years old, and you're presenting to Russian parliament. What are you presenting about? And how is the reception?

Starting point is 00:13:14 Yeah, so a little bit of background. So after Soviet Union collapsed, the entire population of the country, everyone lost their savings in the banks, like twice during the decade. So it was a quite harsh time for everyone. And for us, it was really strange. Like we weren't able to understand how with all the modern technologies, with computers

Starting point is 00:13:38 and et cetera, how it's all like, how is this corruption in how it's even possible? That your savings can just disappear. Yes, definitely some technologies should be there to solve these problems. We had internet pretty early and we were hackers. I mean, it was at that time of the internet era when everything was possible. Access to everything was possible so at that moment we read lots of the hackers manifestos and some like libertarian ideas wandering around the internet and we saw all these ideas of decentralized type of data storage which can be bulletproof from various attacks or attacks and

Starting point is 00:14:24 modifications like falsifications. Right, it's resilient against falsification. Yes, resilient against falsification. Like a blockchain type of idea before Satoshi actually released his first paper on the block chain, which was never the one word. It was like block, like chain of blocks.

Starting point is 00:14:42 But BitTorrent and other types of Israelite storages existed before. Ideas about this were circulating over the internet. So with this combination of those ideas, we came up to a solution, as we thought, for eradicating corruption

Starting point is 00:14:58 in Russia, to make all of the governmental expenses completely transparent. Stored on the people's machines. Stored on the people's machines, so that none of the governmental expenses completely transparent. Stored on the people's machines. Stored on the people's machines. So that none of the corrupt officials can actually even do anything with the data. So we're presenting this idea

Starting point is 00:15:13 and pretty soon when people realize what we're talking about, they basically ask us to go out. Just like, shut down the mic. Shut down the mic. He's like, the meeting is over. Thank you so much. Sorry, we're having some technical difficulties. You can step off the stage. Shut down the mic. He's like, the meeting is over. Thank you so much. Sorry, I'm having some technical difficulties.

Starting point is 00:15:26 You could step off the stage. And then the guy who was actually... Who invited us. Who invited us. He was some sort of a deputy for the head of the party at the time. At the time, there was multiple parties, like United Russia. But this guy came, like... Approached us.

Starting point is 00:15:43 Approached us in the corridor saying, saying boys i can see you are very smart and all these ideas are just brilliant but stop talking about this bullshit otherwise someone will kill you no no no not not us like we're good guys but there are bad people who are making lots of money and this is against what they want okay so. So now, at that point, do you pretty immediately pivot to something else? Pretty immediately we realize that what we need to pivot into is

Starting point is 00:16:13 grassrooting those ideas instead of trying to make them top to bottom approach. Instead of being the missionaries of anti-corruption. Yes. Distribute the risk a bit. It's hard to be quite clear that people The missionaries of anti-corruption. Yes. Distributed the risk of it. Yes. No, it's hard to be quite clear that people in the government

Starting point is 00:16:29 are not those people who really can adapt those ideas. It was another story to that, that in a week after that, they actually invited us again to come. We came in and they asked us to work on a project. And we said, well, what is a project? And they said, well, you mentioned something about denaturalization

Starting point is 00:16:47 and how denaturalization can be anonymous at the same time. Can you create an anonymous HR agency which will sell seats in government? And we're like, wait, what? He's like, yes, yes, yes. So imagine people who are actually making lots of money and who's capable of paying lots of money and who's capable of paying lots of money for a seat in the government they are people who like business they manage better like they can manage stuff better than us so like just from the street

Starting point is 00:17:15 just just happened to be here just by chance because someone was like a friend of someone so if we actually invite people who did something in business and have money to pay for the position in government they can do a better job for their country and our first reaction was like do you really have a price list for that he's like yes yes for sure like can you give us an example and the guy was like deputy minister of finance was half a million dollar and minister of health care i know ecology ecology was three million dollars the and minister of health care, no, ecology, ecology was $3 million. The question was immediately, ecology? No one gives a shit about ecology in Russia.

Starting point is 00:17:51 She's like, exactly. That's how the person who will take the position will have a return on investment. They use all these fancy words. They'll get their money back pretty much in a year on bribes. So we quite soon realized that they are... You were like, well, I appreciate the invitation. Appreciate the invitation, never call us again.

Starting point is 00:18:14 Thank you. That was our reaction. But yes, that was a moment when we decided to pivot to building our own businesses and... Making our own money, gathering resources money and then building type of technologies ourselves and then you can buy the ministry of ecology one day one day or we can like do the revolution or something like that now at that point while you're observing all this and it's imprinting your young minds are you thinking eventually we are going to want to build businesses somewhere else or did you anticipate that you would be building in russia

Starting point is 00:18:53 for the foreseeable future how are you thinking about things at that point for us somehow at this particular moment it was still unreachable the idea that we can fly somewhere and build businesses there. It's only years after that we start to be more confident in our abilities and start to think about that. It was miserable. The first time we flew to the United States just on our own,

Starting point is 00:19:16 miserable experience. Very low level, poor level of English, no understanding whatsoever what the country looks like and what's going on in there. We were trying to raise investment. We're trying to raise investment. We were trying to raise investment.

Starting point is 00:19:26 It was total flops. Miserable. That sounds like a hard slog of a first trip. Exactly. Okay, so at the time then, you're just focused on building businesses, and what type of business were you building at that point? We had like ideas 2001, 2002. Even before that, our first company was in

Starting point is 00:19:46 isp internet service provider we wanted to have a good internet connection and it was super unaffordable like five thousand dollars to connect your apartment wow like it sounds very unreachable for most people especially for the family of eight people who was making like a couple hundred dollars a month for the household, it was unreachable. So at some point we realized that if we want to have such level of internet at our own apartment, what we can do, we can go through all of the neighbors and it was like, what, 1,600 apartments in the...

Starting point is 00:20:23 Small district. Small district. Yeah like it's quite the neighborhood the neighborhood like a dense neighborhoods of novichoromoshki in moscow and uh we literally rang all the doorbells and we're like the question was like do you have a computer if the answer was yes do you know what internet is if the answer was no like okay let us explain you let's have some tea. And we were literally sneaking into people's apartment and starting to explain them what they are losing

Starting point is 00:20:50 by not having internet already connected to their computer. So we pre-sold a couple of hundreds of contracts. And with that, we were like, okay, we can now go to the bank, get a, how is it called? A loan. Consumer loan. Just like basically a consumer loan. And we used the money to buy to the bank, get a, how is it called? A loan. Consumer loan. Just like a basically consumer loan. And we use the money to buy all the equipment, to buy the cable, like the fiber.

Starting point is 00:21:12 Yeah, fiber optic cable. Fiber optic cable. And basically connect all these households and people paid. And we covered the loan pretty fast. It still was a quite challenging project. So I'm wondering just what you're buying with the loans. You're buying servers, sticking them in a bathroom. How is it being connected

Starting point is 00:21:29 to the existing infrastructure? First, we needed to basically someone to bring the cable in. It was the most expensive part of the operation. Digging trenches. We hired the engineering team. We were lucky because the

Starting point is 00:21:44 largest hub, communication hub for the Moscow Internet was basically two kilometers away from us. That's great luck. It's a great luck. And we, because our parents are from science, we were in the part of Moscow where most of the scientists were, and universities were there as well, and that's why Internet first emerged at this point. So we hired these people, the engineering team,

Starting point is 00:22:09 to bring the cable. And then by night, mostly, we were connecting 20-story buildings to each other by shooting the cable using the athletic air ball. Oh, like a crossbow? Crossbow, yeah, yeah, crossbow. It's just local officials, they were bribed by the bigger player

Starting point is 00:22:29 and they didn't allow us to actually... They wouldn't give us the keys. ...get into the roofs and to properly set the cables. Competition. Competition was there, even though we had the license and by law they couldn't prohibit us to do this, but they were like not allowing us

Starting point is 00:22:45 that's why at night we would sneak onto the roof like pretty dangerous operation of getting onto the roof even without having an access through the door and then from the roof to the roof we basically were like putting these cables on our own using the crossbows

Starting point is 00:23:02 shooting from one roof to another roof this company was then acquired by a bigger player. There was a significant consolidation on the market. Between the Ninja Crossbow expansion and the acquisition, how long did that take? Two years. Two years. All right, moving fast.

Starting point is 00:23:21 Then later on, we realized that what we actually need to do is supercomputing. We were like, we are smart in mathematics, we can write algorithms. And this is something like, we foreseen the future of cloud computing, using machines in internet to parallelize, compute. This was our idea originally. Then we realized that it's impossible to do in Russia type of the business. And we decided that what we can do we can start building games now before you go on was the computer science and like whatever coding experience you had was that self-taught was

Starting point is 00:23:55 it school was it parents our college degree is computer science but in reality in russia at this moment no one will really teach you properly computer science because your teachers would know less than you. If you're motivated. We were lucky because our parents were scientists. We got PCs at our home much earlier than most of our peers. We got internet at our home much earlier than most of our peers. We got internet in our home much earlier than most of our peers. And we were super excited about this technology. We were curious and, how to say, naughty. So we would break

Starting point is 00:24:34 the computers all the time and we had to fix them all the time for the parents to continue the work and that's how we actually learned how to... We built our first website for our guilt in online games. Online gaming, like Ultima Online. Great choice. Curious and naughty, that can be the name of your autobiography. The life and times of the Lieberman. Okay, so you have the consolidation, and then you decide to focus on games after that.

Starting point is 00:25:05 And what form did that take? We played Ultima Online. We were super excited about this type of games. We thought that this is a revolution, because people just hang out there. There is no aim, or you don't need to just kill all the enemies. Just people hang out there. Sandbox. You can have a marriage there, build a house.

Starting point is 00:25:25 Like Roblox. Instead of Doom. We were very excited about this, but had to play only overnight because of dial-up connection and the phone was for everyone in the apartment, for us at night. That's why we actually wanted the better internet all the time.

Starting point is 00:25:44 And that's how the ice piece started so then when we decided to build such game at that moment this idea was really not popular you even can find some quotes from ceo of electronic arts who would say like online games is just a niche market no one ever will play online games and all this stuff. He actually officially admitted he was wrong. Many years later. I mean, that's very, I suppose, honest. A lot of people don't own those things.

Starting point is 00:26:18 He was super cool in this. He was like, I said that. I was wrong. Like, nah, we are in the game so and we tried to launch several um one time failed our own uh savings spend all of our own savings without soon but then world of warcraft was released and we were the only ones who were for years trying to raise money for such type of the project. And that's how...

Starting point is 00:26:47 We got all the attention at this moment. And we raised our first money. So World of Warcraft comes out. It proves... It's a proof of concept for what you are also trying to pursue anyway. Not only proof of concept, it was the first game ever netting $1 billion of profit a year. I think people outside of games also today

Starting point is 00:27:07 do not realize how big the numbers are like the opening weekend for the new call of duty compared to like every hollywood blockbuster for a six month period or something like that the numbers are astronomical this market was really for years larger than the movie market. But 15 years ago, it wasn't really. But it was already obvious that it can make lots of money. So we were able to convince some investors. Investors tend to like that. And we got a lot of attention, grew pretty fast to 150, 200 employees in different

Starting point is 00:27:46 times. But then 2008 crisis came and just it's all... And we were not ready. I mean, World of Warcraft, it took Blizzard, the top game development studio in the world, that's what we didn't realize when we started, it took them like five, six

Starting point is 00:28:02 years to build the game. It's quite complicated. With an army. With an army and unlimited resources. And us, we're like, we can do it with a couple million dollars. OK, we were miserable in this case. But honestly, in this experience, we realize that we can be cool in developing, sort of hacking our way through through the challenges inventing new stuff

Starting point is 00:28:26 inventing how we can build and new type of process and technologies and etc and even though we bankrupt the company in 2009 i remember march 2009 i had to fire everyone like 150 people in one day sounds fun super fun the most challenging experience of our life and then three four months later we already started an animation studio and used all of the ideas which came to our mind during this period like we can actually do this and this and that we wouldn't do this in the games but we can do this in the animation process so you're able to take things from the failed gaming studio and transfer them over into the... In terms of experience.

Starting point is 00:29:11 Mostly the experience of like lesson was learned. We knew how to do stuff better as we were progressing from knowing nothing when we started to basically having like a pretty sophisticated production process, we immediately reinvented the animation process. So we basically took the guy who was experienced in producing 3D graphics and was like, okay, why don't we change it all? Why don't we take what you know and then try to figure out how to make it much more efficient?

Starting point is 00:29:42 How did you decide on that? It was a super challenging time. The company was bankrupt. By that time, we actually already were quite successful in different stuff. We already had a venture firm, raised $30 million to the venture firm. But this venture firm was took over. By our investors of the game studio. So it's like Russian-style.

Starting point is 00:30:07 Like people with the guns on the cars. Literally people on the, like, the security people from the persons arrived to the office, took us in the black cars, driving us to the underground of the office building in the middle of Moscow. And then threatening us

Starting point is 00:30:22 that they will kill us and our family because they know where everyone lives unless we'll return the money. So this type of business experience. Hard line, strict investors. In that moment, we knew that we need to with a new project, we need to do something fast because we still

Starting point is 00:30:38 had some obligations in place, which we just fired because we haven't paid the salary for the last month. Okay, right. So you had outstanding debt to the employees. Outstanding debt was like half a million dollars. employees, which we just fired because we haven't paid the salary for the last month. So you had outstanding debt to the employees. The outstanding debt was like half a million dollars. And we were still living with our parents.

Starting point is 00:30:53 So we knew that we don't want to have investors anymore. And they see all this experience which we had. We wanted to do something which can generate cash right away. Enough apartment building basements. Yes. That was enough. A friend of ours,

Starting point is 00:31:08 who is a famous actress in Russia, she told the CEO, the president of Channel One, which is like NBC Russia, like the largest network. Or like one of the BBC channels in the UK. Exactly, exactly. That we can do magic with graphics. She told with graphics we can do magic with the computer graphics how did you become friends with

Starting point is 00:31:30 the actress friends of friends introduced us and like we basically become super cool friends we're like writing scripts together for the future movies and stuff it's like in reality i'm not sure that she really knew that we can do that. But she was very confident in selling it. But she knew that we fixed her internet. Many times. Goes a long way, keeping somebody online. So she sells this head of this primary channel that you guys can do.

Starting point is 00:32:03 You can work magic with graphics. We work magic with graphics. And we actually were doing magic with graphics, but for games. And he wanted to create a political satire show, which would be based on the last week events, which is impossible. Animation, the usual production cycle is 9 to 12 months. South Park is actually like 3-4 months, but then they leave this several minutes for something topical

Starting point is 00:32:25 which they can produce over a couple weeks right before the episode is released like they're doing this and that's south park they're the fastest they're the fastest exactly um and we invented the production process which allowed us to produce a half hour animated show 3d graphics in one week how did you do that The interesting part was we just basically disassembled the entire process on smaller pieces and parallelized them. This idea of decentralization and parallelization

Starting point is 00:32:54 was like, we couldn't live it. So rather than an assembly line type of production, you're like, how many of these can we have running in parallel? Were you able to borrow resources from the channel to work on those parallels? No. We actually, at the time, were able to borrow resources from

Starting point is 00:33:10 IBM. Okay, how's that work? A friend of ours was the president of IBM of Russia. And we agreed that... And he was a DJ in the club. During the weekends. That's how we knew the guy. So during the weekends... Moral of the story, you never know who's DJing at the club.

Starting point is 00:33:26 Make friends. The DJ, DJing at night and they're like during the weekends and then being in a suit, like a serious president of IBM during the weekdays. That's crazy. That's crazy. And the guy was like, I fucking love what you're doing. So I'm sorry, can I say this? Oh yeah.

Starting point is 00:33:42 And like, he was like, like yes i'll give you the equipment and they gave us like a i don't know what was it it was around like a million uh dollars for servers servers with the idea that they will give us this equipment not permanently but for some time for free in exchange that ibm will use the fact that this show was created. The most innovative show was created using IBM equipment. But then they gave us equipment, but IBM decided that it's too political and they never

Starting point is 00:34:13 even used it. Because the show was political satire in Russia. So the headquarter in the United States was like, no, no, no. That does not sound low risk. They allowed us to use they allowed us to use the equipment but never put the logger in there okay so they allow you to use the equipment and then was the president just like look we're gonna forget it's there for a while

Starting point is 00:34:33 you guys can use it yes yes it was exactly like very helpful dj we made we made the first season using that equipment the channel one paid us like three million dollars for the first season using that equipment, the Channel 1 paid us like $3 million for the first season. And with that money, we were able to buy all the equipment we needed. Because you owed half a million to the employees. Yes. It was advance payment. So we came to Channel 1 and said, we need advance payment. They're like, why? It was like the processes.

Starting point is 00:34:57 And we basically paid the debts. Wow. Okay. Okay. So what happens then? You have this parallel processing that's working with your semi-permanently borrowed IBM machines from the DJ. You make 3 million, you manage to negotiate prepayments, so you satisfy your outstanding debts to paying the ex-employees. And then what? This was the first time when we actually started to earn enough of our own funds. And we returned to, first we returned to our ideas

Starting point is 00:35:30 that we need to think about. How to fight the corruption. How to fight the corruption. What type of technologies can be created to... Were you guys not afraid? Honestly, the part of us not being afraid probably somehow was related to our dad was never afraid of whoever was challenging him.

Starting point is 00:35:47 But at the same time, back in 2000, as we finished the school, we knew that if we have all these ideas of changing the world, it's going to be impossible if we just stay home, play computer games and stuff. So we decided that we would go to some business trainings, personal development trainings, fear trainings. We started challenging ourselves in developing ourselves. And by 2005, we spent like four years developing our own internal equanimity. So let's talk about this equanimity for a second because this is super important and it's sort of the enabler or the handicapper the lack of it being a handicapper in so many different capacities and i would say a lot of the people listening to this are going to be from the u.s and fortunately for them they've never had the experience of being under a political regime where people disappear but i've spent a lot

Starting point is 00:36:44 of time in south america or poisoned or or fill in the blank. Yeah, disappears in quotation marks. But what you realize is there are political regimes all around the world, very common, where people routinely are killed, poisoned, or otherwise made to disappear. So the risks were very real for you. And these are not conspiracy theories. Like there are actual threats. So was the lack of fear, a lack of fear of death? Or was it a belief that you could extricate yourself or avoid any type of like really significant consequence or something else? There are three answers to that. A, yes, we don't afraid to die.

Starting point is 00:37:24 Somehow don't. I i mean this is like you die that's it whatever b somehow and it actually really helped with the bandits in 2009 when they came to ask for all of their money invested in the game back we knew that it's their way of threatening you and they want you to be afraid. They want you to fear. And that's how you're on the hook. As soon as you show the fear, that's when they hook you

Starting point is 00:37:53 and you owe them forever. And we showed them that, like, I can't kill us, whatever. I mean, you will never get your money back. And the other case, we can probably work it out somehow. We learned through this experience that actually, if you don't show the fear, it's much safer than if you show it's a little bit like with lines blood in the water yes but then the third one the third one is when it comes to the political systems let's say particularly the russian political system for the kgb people who

Starting point is 00:38:22 were actually running the country at that time like putting this axe head of KGB that's the only thing which we all should understand that's a country run by KGB people yes they call themselves FSB but who's give a shit it's KGB it's the same guys who were just basically killing people 60-50 years before that in Russia, after the war, before the war. So when it comes to them, they see two types of people who are playing against them. It's either enemies or idiots. Fools. Enemies or idiots. Enemies or fools.

Starting point is 00:38:56 Like spies. Your eyes work for CIA. Or you're an idiot. Or you're an idiot who was convinced by CIA to fight against them. And you're just a fool. You're a pawn. We played the pawn card.

Starting point is 00:39:13 We're like, let's show ourselves as if we're stupid. And we were completely transparent about all of our ideas from the very beginning. They would just see us as fools town lunatics town strategy worked at a particular time at the time it was just so rare that they're like oh these guys are just crazy because because we made it transparently if you're a cia agent you

Starting point is 00:39:37 will try to hide but if you like transfer money to the biggest opposition you're like you probably in plain sight yes plainiding in plain sight. And they're like, oh, idiots. They spend their money. Okay, whatever. We'll just steal this money from the opposition here anyway. So fools. That was the situation.

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Starting point is 00:40:45 You will get a free one-year supply of vitamin D and five free AG1 travel packs with your first subscription purchase. So learn more, check it out. Go to drinkag1.com slash Tim. That's drinkag1, the number one, drinkag1.com slash Tim. Last time, drinkag1.com slash Tim. Check it out. All right, we may come back to this, but I want to make sure I don't lose the thread. So the graphics for this political satire seems to be working pretty well. You return to your ideas from prior, which is how we got here. So thinking about anti-corruption and things like that. And then where do you leave? We started our move to the United States. is how we got here so thinking about anti-corruption and things like that and then you know we started our move to united states we already established our presence in los angeles because of animation

Starting point is 00:41:32 2010 in 2010 and started to move all attention to so we were like united states nothing good gonna happen in the country it's ran by the kgb and we'll like they're not going to release their grasp over the country unless it's going to be like a revolution type of situation, which we saw that even the opposition, they were trying to play the political game. And it was a lost game from the very beginning. So we knew that the show, Political Satire, on the largest TV network in Russia is not going to last more than the term of puppet

Starting point is 00:42:05 president Medvedev. That's exactly what happened. Like as soon as Putin get back to his position, like the show was shut down immediately. So we knew it's going to end. And we knew that we need to spend all of the money which we'll make from this in order to transit to United States. So two questions, and it might seem obvious to you guys, but I think for a lot of people listening, they might wonder, well, why not Europe? Why not somewhere else? Why the US?

Starting point is 00:42:31 And then how hard was it, or how easy, to start to move your lives to the US? You know, in Europe, especially animation industry, is mostly subsidized by government. So you actually need to deal with bureaucrats and you need to get any finding.

Starting point is 00:42:49 The private sector almost doesn't exist. So I would say that makes it very hard for immigrants. Yes, exactly. And it was always like, if you want to get... If you're not local, you need to work with local studios and they should get this funding. We started developing the relationship, but even faster we realized that in Hollywood, you need to work with local studios and they should get this funding and like all this stuff. We started developing the relationship

Starting point is 00:43:06 but even faster we realized that in Hollywood we have all the chances and pretty quickly we were introduced to people who then introduced us to the agencies and William & Morris Endeavor signed up with us January 2010.

Starting point is 00:43:20 Half a year after we started the company. You know, it's still a challenging process. Any immigration is a challenging process. It took us six years. Hope you will really take us seriously and to get to the same type of level of professional acceptance like then we had back in Moscow.

Starting point is 00:43:38 But we found our ways. But at least it is possible here. You know, like in Europe or like in UK, you would never become... You would never be able to spend only five, six years and get into the major Hollywood studios. California has a lot of downsides, but one of the upsides is,

Starting point is 00:44:00 and this is true in a lot of the US, no one is discriminating against green. And people like opportunity. And also California, a lot of the U.S. No one is discriminating against green. And people like opportunity. And also California, a lot of people don't realize, part of the reason Silicon Valley worked is that California also makes it very hard to enforce non-compete contracts. So there are opportunities everywhere

Starting point is 00:44:19 of all different types. Yeah, we agree with you. This was our observations, that it's all about non-competes, that they are not enforceable, that this allows you to actually work at Google, write your own search engine at night, and then launch your own search engine,

Starting point is 00:44:36 and Google cannot do really anything with you. There's a lot of free flow of talent, which makes it hard sometimes to retain talent in Silicon Valley, but that's a whole separate story. So you land in LA, you have introductions to people at, say, William Morris Endeavor and other places.

Starting point is 00:44:55 What happens as that momentum starts building? We actually had a pretty good success working with different studios and different big names, like Jimmy Fallon. We worked on the show with him. good success working with different studios and different big names like jimmy fallon we worked on the show with him at some point we met with the guy who used to be john stewart's a head writer and he just moved back from new york to los angeles and was a sort of available ish he wasn't for a year but then a year later he was available and we took our chance to become friends over the year and then when he'd become available like josh why don't you work with us and we

Starting point is 00:45:32 managed to convince him because we showed him how fast we actually can produce animation even like willie morris endeavor or josh even being a friend for us for like a year they never actually believed that we can produce animation in one week. And we had to prove it like literally by saying like, Josh, are you serious? Okay, just let's write a script right now, a one pager.

Starting point is 00:45:55 You will write one pager joke. In a week you will have it. In a week you will have it in animation. And that's what we did. And it was like, whoa, you guys were saying true. You guys can actually do it. You guys can actually do it. Before that, he worked at Simpson before Jon Stewart. And at Simpson's what we did. And it was like, whoa, you guys were saying true. You guys can actually do it. You guys can actually do it.

Starting point is 00:46:05 Before that, he worked at Simpson, before Jon Stewart. And Simpson's like 12 months of production. Like a year. And you're making a joke, and it's already old. A year old joke. And with us, there was an opportunity for him to make jokes, which are super cards. So it was cool. But on the other hand, I really wanted to focus more on the technologies which can transform

Starting point is 00:46:26 society and plus hollywood wasn't really our thing you know like there are some trade-offs yes no one cares about technologies especially that time you're like it's before netflix and before all the stuff no one cared about technologies no one cares that you're faster and cheaper like who is your like producers and like divorce lawyers and all the stuff wait wait wait how does the divorce lawyer fit in we don't know but people in hollywood say so oh wait you want you need to know divorce lawyers yes because they know like the power dynamics oh this is good for me to know there There's like a power dynamic of like divorce lawyers who control. Oh, I picked up a new stratagem today.

Starting point is 00:47:07 Thank you. Exactly. Okay, divorce lawyers. So we met all the lawyers and we started to know the people and we started to meet the people. And eventually we deconstructed what the show needed to be in order to come to a meeting at Fox. At that point, then you're pitching your own show. Yes. So we get to the point're pitching your own show. Yes. So we get to the point understanding

Starting point is 00:47:27 that we cannot sell our technology. We have to sell the entire show. We should package voice actors. The Trojan horse with the technology inside. We took it all. That's why we needed Josh, because we needed a head writer. We took the voice actors,

Starting point is 00:47:40 we took the best concept artists, to combine this all and produce a pilot, like a literal final quality pilot, and brought it to Fox. And who was it? Susanna Makis at the time. She was like, wow, I love it. Because we actually knew what she likes, who she likes. What type of artists.

Starting point is 00:47:59 What type of artists. We engineered it all. Data, data, data. Went to a custom tailor to put together a pilot for her. Yes, exactly. But it was also a misfortune time. Because we didn't get back to power. So our show was canceled back in Russia.

Starting point is 00:48:18 In 2013, the banking crisis in Cyprus. All our money was nationalized. All of our money. Waitized so wait a second so cyprus so does that mean that you had moved your finances from russia to cyprus and then it was out of out of the uh out of the pan and into the fire yes and then cyprus got nationalized it was like oh it's the same story all over again yes same all over again 6 million dollars like earned and all of a sudden we couldn't pay anyone in the United States

Starting point is 00:48:49 no voice actors, no screenwriters we couldn't pay anyone immediately it all fell apart so did you get the green light for the pilot and then Cyprus and then bye bye fuel and we tried to think what we can do in Hollywood more

Starting point is 00:49:05 for like half a year, a year. But then we realized it will take us another four or five years to recover because there's no money. There's like nothing in there. So like, screw it. We're not going to stay in Hollywood. Let's move to Silicon Valley. So we moved to Menlo Park.

Starting point is 00:49:21 Right in the middle. Right in the middle. And also we really already wanted to return to our real like ideas we we started with uh transparency again we decided that we can do a trick that we can actually not target governments to become transparent but target non-profits like why we don't see how non-profits actually spend their money. It's kind of obvious. It's not your personal money. It's like we all together gather these funds

Starting point is 00:49:52 to make the world a better place. So we created a transparent banking platform for non-profits. For many reasons, we were wrong about the ability and readiness. The appetite. The appetite, exactly. The appetite for the nonprofits. But this was also the times when we realized that some of the fundamental challenges which we saw in economy, actually, they were true in the United States as well. Not only in Europe, not only in Russia, not only in Israel, but in the United States as well. Not only in Europe, not only like Russia,

Starting point is 00:50:26 not only is Israel, but in the United States as well. And we realized that even with the nonprofit transparency, if you will look at research of what actually donors want, you will see that the previous generations of donors, they don't really want to see where the money is spent. It's like, it's almost the last item in the list of their requirements. But our generation, the generation that's younger, they actually are in the first place.

Starting point is 00:51:00 We want to see what happens with... The dynamic of thinking behind this is that for the older generation, they donate money because it's a give-back for them. So society gives them a lot. It's feeling good versus doing good. Yes. And for the youngest, it's like giving forward.

Starting point is 00:51:18 We want to change what's bad right now, and we want to see it's changing. And also, actually, previous generations got a lot from society in terms of form of free education, almost free college education, like 30 years

Starting point is 00:51:33 ago and things like that. New generation being hammered with student debt, etc. They don't really feel that society gave them much. But they really still donate the same portion, share, than the older generation,

Starting point is 00:51:52 but it's just different reasons. I feel like some of the younger generations here, younger than certainly me, get a bad reputation for misunderstood reasons. Or I should say they're misunderstood in the sense that, I know you guys have spoken about this before, but if you look at, say, previous generations' ability to get a higher education, put a down payment on a house and pay for a mortgage, compared to some of the more recent generations, it's night and day. So it's important to factor that into how you evaluate them so question for you guys with the looking at the non-profit and this and the the platform right you have you you're very good at it seems like letting go of ideas having a light grasp on ideas if things are not working so you can move to something else that you think might work better that's not true for everyone right some people get very attached to one thing and they want to ride it

Starting point is 00:52:45 until they die and they get attached to things that may never work and i'm wondering how you think about changing direction maybe failure and quotation marks like what allows you to do that so so readily? A, we learn the hard way. So the first, the game studio, we grasp and we try. You know that if you don't stop at the right moment, you can actually get to a deep shit. Yeah, you can get into a hole. Yes. But also what we saw in the data is that, in what we realized also through the experience of game development, failure,

Starting point is 00:53:24 and then animation success, that we realize that... It is not always about your abilities. So you can fail just because of a different reason, like financial crisis. There are multiple reasons. Like poker, right? The time.

Starting point is 00:53:39 You have to study the decision-making, not just the outcomes. Yes. And the statistics of venture startups is that two-thirds will fail. Like completely fail, losing all the money. Zero. And if you will look at all these failures, there are rare exceptions. But in most cases, what you should see is that if your startup is growing, you should continue. You should double down, put your all attention there, etc.

Starting point is 00:54:05 If it's not, think twice. And probably you should stop and quit and start another one. If we look at this purely from the perspective of statistics, if it's not doubled the growth, if whatever numbers behind your understanding of your business isn't doubled, didn't double, how to say, isn't doubled. Yeah, didn't double.

Starting point is 00:54:28 Didn't double. Over what period of time? Over 14 months. 14 months. Why 14 months? I have to ask. It's pure statistics. If you look at the statistics.

Starting point is 00:54:36 If you look at all those failures. Oh, I see. I see. That's the pattern. And success is over that period of time. It's like a pattern. Doubling over 14 months. If you take all of them and divide, then just 14 months if you take all of them and divide then just 14 months because if you're

Starting point is 00:54:46 also not growing with this space venture capital will not be accessible to you and you won't be able to actually raise money this is funds to grow further and things like that so this market is uh is actually a pretty special in terms of these probabilities. Just one out of hundred is going to be a success. And if you don't see a trajectory to get there, probably you're not getting there. The right thing is just to

Starting point is 00:55:16 stop and start something new. And knowing that your chances are one in a hundred, you should try as many attempts as possible. Moreover, we usually show to the young people, wannabe entrepreneurs, we show this picture of Mark Zuckerberg or Evan Spiegel, who made it into success from the first attempt.

Starting point is 00:55:37 Drawn out from the college and look, they're billionaires. Most of the billion-dollar companies are not like that. It's created by people who failed multiple times and then got to success. In terms of statistics, this is what we should observe with these things. Definitely something depends on your abilities to execute, but there are things which are independent.

Starting point is 00:55:59 I remember angel investing starting in 2008 and seeing business models companies that couldn't execute in a period of time because the technology just wasn't there and the adoption wasn't there and then five six years later basically the exact same company but a few things have changed mobile phones have become more powerful a handful of protocols have been developed and then boom, it works. Uber is mobile phone with GPS. Yeah, you're right. Yes, with wide enough adoption.

Starting point is 00:56:31 And it was tried. These ideas were tried before. Online taxi, earlier. Ordering a taxi online? Yes, for sure. It's been there. And because of that, especially because we really,

Starting point is 00:56:42 we balance ourselves between sometimes when we work on some forward-looking ideas. Flying cars. Rocking to Mars. Something which is not happening yet. And also we work on some projects down to Earth which already something which is happening. And we know that with these projects which are not there yet,

Starting point is 00:57:04 yes, there is a chance to win big, but this chance is small. And there is a lot of timing issues, and you can lose just because timing is not right. And we, as Daniel mentioned, we learned it the hard way with Game Development Studio. It was really hard for us to stop even though it was obvious that we were lucky with the animation studio and then another unfortunate event was losing all of the money just in banking crisis in cyprus and we stopped pretty fast i mean we're like are we gonna spend time recovering or are we just starting something new yeah when when silicon valley bank crisis happened we were among like really small group of our friends founders all this time we were obsessed with diversifying the money money on different banks and everyone would tell us that oh like

Starting point is 00:57:59 in the united states you shouldn't think about that don't worry about this cannot cannot cannot just because cannot and we're like right surprise we are not immune from all the problems we've seen other places all right so i'm gonna i'm gonna zoom out for a second because i i like to think about sort of meta decisions that span across a lot of other decisions and projects and so on. So the two of you living one life, we have to talk about this. I've never seen an example quite like this. I mean, there are couples who are, say, power couples, but it's a different dynamic. I mean, you guys have been seemingly sort of hive mind from a very early age. So when did this start? So you have one email address, one Instagram account, one LinkedIn. I think the phone is maybe the same.

Starting point is 00:58:51 It's connected. Right. So I'm looking at some notes here. So since you were born, this year was the first time that you guys spent 10 days apart. Put it another way, not being together in one place when you went to a vipassana retreat all right so could you explain for people who understandably will find this interesting and kind of alien how did this come about and how is it helpful versus confusing i mean how do you guys do it it is confusing but a we should understand that we the six of us grew up in one room of a size smaller than this studio okay for those who can't see the full studio i mean it's

Starting point is 00:59:33 not huge right it's not this isn't an airplane hangar it's not a basketball court it's like a bedroom yeah three bunk beds that's how the six kids could fit in the room like this and then even later so we grew up like this up until like school already started and i think like until 13 14 years old it was a situation more or less and then parents also sent us to school by pairs it was like a logistical innovation it's like buddy diving when you're scuba diving exactly it was dangerous to walk on the streets in 90s alone together they don't need to walk us to school so we can do it by ourselves and all the degree of confidence exactly so they were sending us by pairs to school not only the two of us but the other kids as well so we were a pair dave was five years old i was

Starting point is 01:00:26 six years old when we went to the school and the rest of the kids were seven so we were bitten but because it's two of us we learned how to learn how to like avoid to protect ourselves being two rather than one so had to survive it's like bonding experience for the bonding very helpful for the bonding helping each other like through the education like doing homework together all the stuff together by 13 14 years old that's when we started forming our own ideas of what could be cool for us to do in our life and that was already like a social justice type of thinking, like how can we make the world a better place for everyone? And starting from there, we saw how no one literally was supporting this idea,

Starting point is 01:01:12 except two of us basically continued the conversation in between the two of us, and it never fade away. Which idea is this? This is the combining? The idea is that like transparency in government, it was just one branch of this idea. So the two of you are very aligned. Yes, the technologies can actually lead us to a better governance.

Starting point is 01:01:34 And that's what we thought. And through this experience of being kids, first we realized that when you go to school, all kids, they are alone. But we weren't. It gave us a lot of advantage. We're always two of us. We don't need to struggle to company gather around us

Starting point is 01:01:54 because it's already two people. It's much easier to gather a company, like a group of friends around. Also, we realized that if I know mathematics better, we can do it the way so that no one wouldn't know that Daniel don't know mathematics as I do. As good as he does.

Starting point is 01:02:13 So you can actually copy. Yes, Voltron type of situation. And we learned that that's what we can do. And if we weren't allowed outside world to actually distinguish who has which qualities, we will be able to seem to be superhuman because we have both of the qualities. Okay, so I know you guys, as an example,

Starting point is 01:02:41 are fans of the Collison brothers, right? Yes. Amazing. And Patrick's been on the podcast my understanding is they have they're very powerful together but they have maintained they're like i don't say batman and robin that's not quite the same they're like you know two of the avengers right i mean they're superheroes but they have clearly delineated separate points of contact and so on what have been some of the other advantages

Starting point is 01:03:04 or drawbacks of doing it the way that you guys have approached it? Even though they're definitely more separate than we do, but they did a lot of really great stuff. For example, they were CEO and president, they switched who is CEO and who is president and they switched roles, so they

Starting point is 01:03:20 actually showed to the world that they are interchangeable. A team. A team. And they are great in this regard. But our question... In our case, we went to just an extreme version of that, having one line of communication.

Starting point is 01:03:36 So if you text me, you actually text both of us, and you don't know who answered this text. But we can answer faster. We can answer faster. Seems to be this superhuman and that worked pretty well during negotiations of the contract honestly hated speaking to people as he was young he was like super not into talking to people and i was super easy to talk to people so it was my role in the couple to talk all the time and i wouldn't

Starting point is 01:04:07 still never he was never picking up the phone if someone called i don't pick up the phone either for me it's just too much i don't know what i'm signing up for unless it's my brother or a family okay fine there are a few exceptions imagine that you can outsource that. That's pretty cool. It's nice. So that worked in business pretty well, even though our first business partners, they were like, why you're on the same meeting? You can be in two places at the same time and things like that. But we even at some moment gave up

Starting point is 01:04:39 on trying to explain to them that it allows us to, in business especially, it's like win or lose. You won this contract or lost the contract. All these meetings are important. If you're playing two contracts and losing both of them, it doesn't matter that it was two of them. If you're playing one, but you're playing a hardcore game

Starting point is 01:05:00 of us being a team in this conversation, which can win the contract, it works much better. Yeah, bird in the hand versus two in the bush. Yeah. So what are your respective roles generally then in terms of responsibilities or strengths? How do you think about that? I would put this this way.

Starting point is 01:05:17 We have two different intuitions and they're like completely different. David's intuition is he absorbed data he remembers everything and then at some point he can just like the answer is this like 42 like just out of nowhere out of like you're like why he's like i don't know but i'm pretty sure that it's 42 42 yes and then the next morning he can wake up he he's like, yeah, and now I know why. I cleared my past as this place in my mind, which actually made the calculation and tell me it's 42.

Starting point is 01:05:52 So here's why. My intuition is completely different. My intuition is like, we need to fly to London tomorrow. And he's like, why? I have a good feeling about this. And then we fly to London and we got the investors. It's like why i have a good feeling about this and then we fly to london and we got the investors it's like this i'm like we need to offer these people this and there is like no no no no no i'm like yes yes yes we need to offer them this i offer them this and they're like yes agree handshaking and they're like how did you know i'm just, I felt it. So Daniel much better in reading people.

Starting point is 01:06:27 Daniel much better in reading situations. In general, I am much better in processing data, processing knowledge. I have this strange qualities that I remember everything. Is that hard for you? I'm just wondering, because I have family members like this, and sometimes it's a huge advantage. But are there things that you wish you? I'm just wondering, because I have family members like this, and sometimes it's a huge advantage. But are there things that you wish you could forget? I learned to live with that. I think that because we have both of it,

Starting point is 01:06:53 and I see what is the advantage of a different type of thinking, etc., and I learned how to live with that, and now I embrace it. I understand the limitations, but I cannot read the citation properly. I understand the limitation of this tool, but because it's two of us and we have both, I actually doubled down into these qualities and developed these qualities further and further and further. Do you guys get physical or psychological anxiety when you are separate this was the first time when when we were separate the first time when we were separate like not even being able to text each other because the phone is off during the past night

Starting point is 01:07:34 for ten days long oh well see you had you had something to do I mean you're in your mind Bradley but you had a task so what was it like for you david it was unexpected but for me it was okay because i knew that daniel is working on something which is important i knew that if he will extract some new experiences out of it i also will do that so it's kind of uh i outsourced the guinea pig that was the guinea pig and i actually felt like I had this intuition like, I got to do this. And I just went.

Starting point is 01:08:08 And it was so quick. So David had to wait for three months. So everyone expected... I was accepted four days before the course started. Everyone expected around that I will be devastated by this experience. But somehow I was super calm because probably because I knew that Daniel is working on something important for us. There was a purpose behind it. this experience but somehow i was super calm because probably because i knew that daniel is working on something important for us there was a purpose behind it and then the second time was like

Starting point is 01:08:30 the same situation but reversed he was working on his mind and i was back home for me it was a little bit more challenging meaning that i had this uh mind trick which was oh it's your fault that he's there struggling there and like what are you talking about for you it was a great experience but yeah but for david maybe it's not as as great maybe it's challenging for him like come on seriously stop it all right so you had the internal voice keeping you company yes part of the reason i ask and i don't know if this is true this is from the new yorker piece is selling shares in yourself the way of the future which i would love to hear if there's

Starting point is 01:09:05 anything you wish were different in that piece for those people who might check it out but i was curious because at one point it says at home the brothers share a single king-sized bed is that still the case we recently changed it in april we moved to a new house and we basically decided to have more bedrooms and we have separate bedrooms now. Because this behavior creates some limitations, especially around relationships. Yeah, I would imagine so. So we decided that, especially now

Starting point is 01:09:32 when it's published, we have an additional problem. I was already... Yeah, right, in the New Yorker. I imagine I'm not the first person to ask about this. So in general, our bond is quite challenging in terms of relationship.

Starting point is 01:09:48 That's why we decided that we need to make it easier. Like romantic relationship humans. Yes, we decided that we need to explicitly make it easier for potential romantic partners. And splitting bedrooms is one of the first steps. Maybe a key aim. Different floors. Like Daniel has his own floor, David has his own floor in the house so i can imagine those in my mind right as i'm painting

Starting point is 01:10:12 a picture i just imagine the floor is looking very different like if the respective brother floors must be very different but also you know like when we were in the same room it was for purpose we usually would stop talking only like before like a minute we will go to sleep and start talking as we wake up so what are we doing today like this is like this is a wake-up call now we travel into new york we in one room and we constantly talk non-stop what an incredible blessing and gift it is that you guys have each other yeah i mean like we're absolutely enjoying this way of life yes as david said challenges in the romantic relationship like we will work it out so do you think when you have romantic like let's just say of romantic partners maybe of families

Starting point is 01:10:57 who knows do you think you guys will still live together yes yes we maybe we maybe we'll do some you know like uh is in our vision we maybe create a kind of special house when you have like sections of like private and not private and something like that. Because we definitely need to hear also what our partners want. But we really want to still have a place for two of us when we can spend a lot of time together. Okay. So I have heard, people need to fact check this, because I think a friend of mine told me, just as a model, that Tim Burton and his wife, I think it's Helena Bunham Carter,

Starting point is 01:11:38 if they're still together, I don't know, but that in their house they actually lived in separate wings, and then they would come together for shared meals and things like that so they had a very unorthodox we have friends who build houses when when they have joint bedroom in separate separate bedrooms and a wing for kids a wing for kids so like wing for him wing for her wing for kids and wing for them together it's like a spaceship yeah i like it i like it i'm very interested in all that's why maybe the divorce lawyers can give you some advice hollywood what has worked what has not worked you mentioned evan earlier not everyone's going to recognize that name how did you guys end up

Starting point is 01:12:17 at snap our point of view will always tell the story from the perspective of us meeting Dalai Lama in 2010. When in doubt, go with the Dalai Lama story. So, it was back in 2009, right in between us starting the animation studio and bankrupting the game studio.

Starting point is 01:12:39 There was three months of us... Took a Dalai Lama sabbatical. Yeah, there was three months of us clearly not knowing what to do and then the bandits are threatening our lives we don't know how to like return the money and then we just decided to go for a five six days meditation retreat of a rinpoche a tibetan lama who just arrived to moscow and a invited us. So we came there with no expectations whatsoever. But the gentleman was very interesting. He was young, he was super smart, speaking like 11 languages,

Starting point is 01:13:17 and from time to time he would switch from this Tibetan stories about the enlightened kingdoms to something more practical, even claiming that a single person can actually change the world if they want. And for us, it was like, wait, what? Are you talking to us? And we then asked if we can have an audience with Rinpoche. And we were told that everything is booked already. But five minutes later, he called us. Now, just so I'm clear,

Starting point is 01:13:48 so he is which teacher? Giatro Jigme Rinpoche is like a Tibetan... Spiritual leader. Spiritual, yes. It's like a title which you can get only from your childhood if you recognize it as a reincarnation of someone else. Yes. So,

Starting point is 01:14:06 this gentleman is in Moscow and Rinpoche is asking us to come see him. And we're like, wait, okay, cool. We shared our ideas about transparency, about how in the future we can live

Starting point is 01:14:21 within governments without physical borders. And for Tibetan people, it's a really important subject, knowing that they don't have their lives. So it resonated with him. And when we finished our story by saying, and now it's just two of us, he immediately abrupted us and said, like, the three of us.

Starting point is 01:14:39 And it was touching and unexpected. And he finished his phrase with, come visit me in India in, what was it, January next year. I'm hosting an inauguration of a monastery. Dalai Lama is going to be there. And I will introduce you and we will introduce your ideas together and we'll see what we can do together. That meeting actually happened and not happened at the same time.

Starting point is 01:15:06 So we flew to India. We spent this week in the monastery in India, Tibetan monastery. Dalai Lama actually arrived. We had a non-private meeting with him in a group of 10 European donors of the monastery. But then we had to have a one-on-one meeting with him next morning, which never happened because a storm came. I know, this is like a movie story. The storm came and Dalai Lama immediately was packed into a helicopter

Starting point is 01:15:36 and just disappeared. And we were standing there and in half hours the storm just rushed and flooded the entire valley. For the next two days we weren't able to leave the place because it was flooded. But then a month later we received an email from a gentleman whose name was Jerry Murdoch.

Starting point is 01:15:55 He's the founder of Insight Partners. One of the biggest VC firms in Europe. And the email was like, I'm at the dinner with Dalai Lama and this other monk and they told me I have to email you and they give me your email, so that's what I do. That's why I'm emailing you.

Starting point is 01:16:13 That's why I'm meeting you. We met with him a few months later and we've become close friends. And eventually, through the many different stories, he invites us to a dinner. This dinner wasn't really for us he thought that other people will come but it didn't work so so he invited us instead and there whatever we met yes but since this introduction we always

Starting point is 01:16:37 were quite cautious about everything which was related was related to this I mean that I love love introduced to someone, you stick to the person. There should be a reason. There should be a reason. And we always try to help him and be around and just see where it will go. You're talking about Jerry.

Starting point is 01:16:55 Jerry, yes. And at some point, eventually, he introduces us to Evan at his house. And then Evan gave me his phone number just right away at the meeting. And it was the right moment. Which wasn't expected for everyone around because that's not what he's doing. And we were developing technologies around 3D avatars at that moment.

Starting point is 01:17:14 And that's what was exactly on his mind. On his mind. Like, on his mind was he wanted to combine a Bitmoji which were the 2d avatars he acquired from the canadian company and 3d engine of ar technology of luxury the the ukrainian company he acquired he wanted to merge the two technologies and our experience in hollywood was merging technologies we literally were transferring the 2d styles of existing animated shows into 3D and back and force and back and force. In that moment, we also focused on 3D avatars

Starting point is 01:17:51 and how technologies can actually, not a show, not something which require... Game type of thinking, because we decided right after the financial transparency for nonprofits didn't work, we decided that we looked around and realized that the technology advanced, like a computer vision and style transfers

Starting point is 01:18:09 and like all this stuff advanced a lot since we left CG graphics. And we realized that we know everything and more than probably everyone in the field so we can try to just start something and probably gonna like build a successful company. Half a year later haven't offered us not offered but already acquired us and so just for people who might not have the

Starting point is 01:18:32 the acronym so ar augmented reality right so people may recognize some of the current or recent iterations on snap where you can say put any number of different sort of overlays of characters. I mean, they do partnerships with all sorts of companies and so on. So you can add something to your face that sort of tracks your eye movement and augments the kind of visual experience. So is that what you guys were working on in some capacity? This technology, face tracking technology, it was Ukrainian company Luxury,

Starting point is 01:19:11 which they recently acquired before us. Snapchat recently acquired. And we work how to combine the avatars into this technology. I see. So right now, 3D version of Bitmoji is the most used avatars daily in Snapchat. It's already everywhere, like in your profile, in games, in lenses, in all places. And so you guys get acquired.

Starting point is 01:19:30 And if I'm missing a chapter, let me know. But can you describe what you did, what your analysis looked like when Snapchat suddenly started losing users? I think it was in 2017? 2018. 18. So it was in 2017? 2018. 18. So it was early 2018.

Starting point is 01:19:49 Are you right? 2017, Instagram released their stories. And in the beginning of 2018, new version, new update version of Snapchat was released. Kim Kardashian tweeted, or Kylie Jenner tweeted, that no one would use Snapchat anymore, all this stuff. And audience started to decline.

Starting point is 01:20:12 And at that moment, most of the people believed... Internal idea in the company was that it's due to the... Public sentiment competition. Public sentiment of the bad new version or competition of Instagram in TikTok or altogether. While our analysis of data showed us that it's not true.

Starting point is 01:20:35 And then the major reason for the decline of the audience was related to the fact that Android version of Snapchat, after the update, becomes so slow that people over time gave up. Yeah, they just abandoned. They just started abandoning. 10% of the slowest devices of Android users could have experienced up to 40 seconds before the feed with stories would load. Next time when you will open some feed,

Starting point is 01:21:03 count to 40. 40 seconds, no way. I'll barely wait for four seconds. Exactly. So it was so obvious that this was the reason. But it took some time. We realized that we didn't have any specific position related to that in the company.

Starting point is 01:21:19 And we realized that what we can do is actually to just bring all the insights which we were able to extract to Evan. To the engineering team, to Evan? And to just give him all the evidences so that more focus can be added to the problem and to making the app faster. Now, why do you think you guys spotted this?

Starting point is 01:21:42 Because it doesn't sound like it's immediately your department or responsibilities. Was the narrative that it was the Jenners and the Kim Kardashians and then the competition, was that so accepted at face value that people weren't looking at the data? Or what happened? So there were several reasons. First of all, it's Android. We're Android users. And among executives, it was a really rare thing to use Android as day-to-day.

Starting point is 01:22:13 Evan, he pushed himself to use Android to experience this all. What his users usually experience when they use Android. But we use Android as a day-to-day devices. We're hackers. We don't like limitations of Apple App Stores and closed ecosystems. That's why we always were there. And so when we developed our 3D avatars,

Starting point is 01:22:36 it was the first product. It worked faster on Android than on iOS. And it was quite unique compared to other products. And through this experience, we learned a lot about some limitations. And we was quite unique compared to other products. And through this experience, we learned a lot about some limitations. And we already, at that moment, looked at some data just for our products to be launched properly.

Starting point is 01:22:52 We wanted to fix Snapchat's Android app earlier just for our product to work. So we kind of had already some predispositions and beliefs related to that. Then when the product was launched, we decided to research everything about the user behavior in order to understand how we can better position our product inside of the Snapchat ecosystem.

Starting point is 01:23:12 And with such problems, the challenge, there are different methodologies. For example, there is a methodology to A-B tests. When you launch, half of the users will see one version and half of users will see a different version. And then you will compare the results but with performance degradation the result is delayed it's not immediate you cannot really like it's really hard to apples to apples yes so you need to wait for

Starting point is 01:23:38 some time you need data for for longer period of time less you need to break it, give your users a bad version, wait for them to use it for a long enough period for you to see the difference in behavior. Yes, even moral decision was never do that. So you shouldn't really make the experience of users worse intentionally. And as hackers, for us, it was like, okay, can we find a way how to get this data anyway? So we started to look at all the previous bugs. Accidental. Accidental mistakes. Degradations.

Starting point is 01:24:15 Which led to, and then was discovered, but lasted for long enough so that we can actually extract the change in behavior data. Still, it's really important to note in the article in the New Yorker, the words not from us, that's why they are not as clear. There were people who also believe in this idea, not only us. It was basically their initiative.

Starting point is 01:24:39 There were not enough momentum and not enough people who would work on this problem. There were really brilliant engineers who already, before that, started to rewrite. You could be good ambassadors for this. So we used our previously earned social capital.

Starting point is 01:24:59 So we realized that we need to just spend all the social capital on this problem. Otherwise, shares drop to $5 per share from $20 in the entire compensation of ours. In the equity, of course. In the equity, of course. And also, we saw the opportunity. For us, we got through two major crises in our life,

Starting point is 01:25:19 not counting the childhood crisis, financial crisis. That's why somehow for us, when it is a crisis for us, it's a great times. So it's like, oh, like now we can show how we can hide. David Pérez- Yes. David Pérez- Never let a good crisis go to waste. David Pérez- Yes, exactly. And at some point we just had to show that we're good engineers as well. In order to challenge the status quo, David had to sit down and fix camera snapchat

Starting point is 01:25:48 is camera and david made it load twice as fast like not load like when you press the button how fast the picture would be ready i showed that it can be the speed can be doubled so it was like oh wow so yes you are guys also great engineers as well so how did you do that? and we showed some of the principles of how you can find inefficiencies in the code but still, it's really important in the sense that it was a really team effort

Starting point is 01:26:15 of great engineers actually was part of this process what we see as our contribution is this promotion of this idea and bringing this voice to the decision makers so that they also

Starting point is 01:26:28 will be empowered with data to then spread it to the entire organization and that was definitely really great times. It worked. Even though

Starting point is 01:26:39 Snapchat has some challenges right now with financial side of things but with audience since then it's growing. The audience is growing. They recently reached like 800 million.

Starting point is 01:26:49 The audience is growing in the countries where the Androids are even slower. So the app actually is pretty significant, right? In terms of Android apps, it's still like one of the fastest apps to load compared to the major apps out there. What's interesting as well, so launching a new updated version only happened when, like in March-ish of 2019, but it was also important, and we put lots of efforts into this program

Starting point is 01:27:16 more than the other one, to fix the existing version. Before the new was released, the old had to be fixed in order to stop bleeding. And by December, the bleeding stopped. And in January, the audience started to grow. In March, the new version was released. It never actually slowed down since then. So I have a question about this type of data-driven analysis. Do you attempt to do this type of analysis with goals or challenges that you have in your personal lives?

Starting point is 01:27:54 Do you try to apply it everywhere? Are there examples that you could give outside of the business context? First of all, we should know that we, as Daniel mentioned about intuition, we believe in both. We believe in intuition and we believe in data approach. But yes, so for example, one of our major principles is that we know what is compound growth. And for example, when we have some crazy goals, crazy for some people, they will set some goals,

Starting point is 01:28:22 and these goals seem to be impossible. What we show again and again is that actually, if you have goals, like, for example, number of followers, or number of dollars in your pocket, quantifiable things, what you can do is that you can evaluate what you have right now and then if you can multiply this number two if you can double two times a year actually every year

Starting point is 01:28:55 if you can double your result it is a greatness you have like the entire money on earth the entire population following etc so it's really important when you have these big goals you can't have any big goal money on earth, the entire population following, etc. So it's really important when you have these big goals, you can't have

Starting point is 01:29:08 any big goal with this approach. But you just don't need to run faster than doubling the number two times every year. Actually, what we realized is that there is this corridor. Physical limitation at the top, which is around 2.4,

Starting point is 01:29:32 you cannot run faster than increasing your results 2.4 times a year in a long run. But what we realized that is actually it's really a tiny corridor. If you increase this number 1.6 times, you're successful. If you increase this number 2.4 times, you're superhuman. You're like, God, like. So this is only the small corridor. You don't need to think about something faster. If it's slower, it's just like a normal life.

Starting point is 01:29:55 Now this is multiplying your KPI by 1.7 times. Every year. Every year. Once per year. Once per year. Yes. And we applied it a lot in our life in our business life in the life of our companies in our personal life so we we use this method how do you apply it what

Starting point is 01:30:12 would be an example from the personal life maybe it doesn't have to follow that doubling heuristic it could but what might be an example but for example amount of hours you spent with a romantic partner you were inspired by. Okay. And so you would track the hours and then look to multiply that over time. So you shouldn't expect that immediately you would start a relationship which would be perfect. And you would spend all the time and all this time would be perfect and great etc but if you have one hour of this experience a year this the next year it can be two hours the next year it can be four hours for some it might sound like in in 10 years you have the entire life like that slow build and we just realized that when you try to run faster

Starting point is 01:31:07 you can actually break yourself I see what you're saying so you can make a mistake by saying okay I'm going to spend half of my time this year with this person because you're sort of biting off more than you can chew and maybe shooting yourself

Starting point is 01:31:21 in the foot for the long term okay so basically having an eye towards growth but not being excessively maybe shooting yourself in the foot for the long term. Yes. Okay. So basically having an eye towards growth, but not being excessively ambitious in the beginning because you'll break things. Yes, I know. On personal experience, yes. This is like when you want too much right away,

Starting point is 01:31:38 you break stuff. Yeah, I can see that. As someone who's got physical breakage also. Yeah, but even with the acceleration when you're in a rocket flying to space there is this limitation of like three g like three times g which then actually start breaking stuff in yourself so it seems that it's an it's kind of natural number this is what we can sustain like 2.4 like uh 2 uh 1.6 this is something which we can sustain physically and mentally um and you can honestly you can find it anywhere you want to play music

Starting point is 01:32:12 just start from something achievable right now today double your result every year and you will become like uh beyonce star certainly true with physical activity too if you think about say weightlifting or whatever you don't need to 10x yes the number every year and if you try you want 10x if you try like i've tried then you start damaging your connective tissue or i remember that it was one of the olympic teams was it in uk or something because i don't remember exactly But they got a new trainer and the new trainer was a coach with

Starting point is 01:32:49 this approach. But the approach was we need to improve our KPIs 1% a week. It's almost the same. And they become champions from nowhere. Years later they become champions from nowhere. The last position on the list, they become champions. But physical activity is the same in business activity,

Starting point is 01:33:07 writing books, money, finance, music. But really important is that you can achieve anything. You can have any type of mission or big goals, but then you write this, you like draw this curve for yourself and be consistent. What are some of the logistics challenges and how have you addressed them in running your businesses how you run them or organizing your lives the way that you guys organize them we have a very messed up calendar

Starting point is 01:33:39 it's like multi-dimensional does that mean that you're just traveling all over the place we travel a lot uh for sure uh probably like this year we're in the states for three months all over the year but at home like at home in la even less time than that maybe like like one week a month, not more than that. But what helped a lot, it started with two of us, but quite fast, two of our sisters joined. And they usually... And they don't travel that much. And they usually run operations in scaling of the project.

Starting point is 01:34:20 Do any of your other siblings have the pair bonding that you guys have? No, no, it didn't work. But five of us, we are quite close. And we work together. We work together. We live together in LA. Like our house is literally like two minutes away from each other. Yes.

Starting point is 01:34:34 And they start to run our operations since game development. And then they become our equal partners in animation studio um and uh in since then it's much easier for us to dream more and to act no now we discuss everything together like philosophy the vision for the future the morality like it's a constant discussion among all of us so i can imagine i'm just putting myself in the place of people listening to this, that I'm sure there are people out there who work with family. And then there are other people who don't work with family, but I imagine working with my family.

Starting point is 01:35:14 And I love my family, but I'm like, wow, if I hired two people from my family to run my operations, what do you do if it's not working? I mean, would you ever fire them? or do you just have complete confidence that you can resolve anything that might come up? How do you think about... You definitely can fire, but for sure. We went through a really harsh experience with game development studio bankruptcy.

Starting point is 01:35:38 And they were the only ones who stayed with us through the challenging period. Yes. And when you actually went through such experience, it's much easier to trust, not trust just because it's family, but because you know what you can expect. You saw how they behaved. And especially in venture business, when, as we mentioned, most of your attempts would fail, it is really important quality to have someone who you can trust that they are with you long term, not just for this project. I would say this worked pretty well. Maybe this was the result of this experience,

Starting point is 01:36:16 which we all had. But maybe just because our parents worked together, for us, we didn't have this concept that it's not right. Never work with your family. No. And we went through challenges. Definitely we argue with each other, et cetera. So we went through a lot of challenges, but it's worth it.

Starting point is 01:36:34 I was thinking also, as you saw your sisters, I suppose, doing the challenges of the game development company, it reminded me of a quote i don't know the attribution but in english is a common expression adversity builds character but the alternative which i think might be just as true or maybe truer is adversity doesn't build character it reveals character and so you got to see how they responded to a lot of challenge which gave you the confidence then and there were a lot of challenge, which gave you the confidence then. And there were a lot of challenges.

Starting point is 01:37:08 We are lucky in many ways. I want to ask you about, this is the same question applied to two different groups. So the first is going to be your parents. And I want to just ask about what ideas of theirs you find most interesting. Maybe that's a place to talk about climatics, maybe not. Then the second is what ideas you guys are most excited about right now.

Starting point is 01:37:32 But I wanted to start with... Do we have a couple more hours for each? Yes. So our parents, so our dad, he was from physics. But he was, by government, pushed out from physics because he was Jew. And switched to biology? Biology, because biophysics was an open field. So physics was more protected and Jews

Starting point is 01:38:00 were more discriminated against in physics. So he found this niche. It was a new niche. It was an emerging new science. And he came there with knowledge of physics. And that gave him a different perspective than most of the biologists

Starting point is 01:38:17 who would see everything through the prism of chemistry or through the prism of biology. He looked at it through the prism of physics. And he started discovering things faster in this field. Starting with the first thing which he discovered was that the color which received by an eye is encoded not in the frequency, which is then translated as a signal inside of the eye nerve, but as a pattern of signal pauses in between the spikes. So the spike is almost like a Morse code.

Starting point is 01:38:55 And this is sort of like... And that's how he realized that it should be a computer is there, that should be a computation, because the encoding happened. He came to this idea. There was a really interesting, weird obsession of his on the idea that if evolution was working properly for millions of years, if not billions of years, then it should be optimal. That the most optimal mechanism should have survived the evolution process. And therefore, what's the most optimal from the physics perspective

Starting point is 01:39:26 in terms of measuring... The amount of energy spent on the operation. On the operation and data. He's like, time. Time in between the quantum events. This is probably the most optimal one. And from this perspective, from the perspective of optimality, he was trying to find how the eye works,

Starting point is 01:39:49 and he was the one to discover exactly how it works. And he's like, wow, so I was right about optimality. And then he used optimality all the way down, exploring into the nerve, into the neuron, and into the core of the cell, into the DNA, and then cross the entire cell. So CHEMATIC was the abbreviation of Chemistry Optics in Mathematics. So he always believed that the real discoveries

Starting point is 01:40:16 are in combination of different fields. That actually the fact that we learn this subject separately limiting us in terms of us being able to discover some things which requires you to look at them. Have some interdisciplinary synthesis. And their success, both that and Mao, the success was because of that. They would combine things which others wouldn't combine.

Starting point is 01:40:41 For example, he brought the quantum physics into describing cells' processes. So even till like maybe 2008, 2010, it was really a marginalized idea in science. They were trying to avoid as much as possible some

Starting point is 01:40:59 complicated processes in biology because it will challenge the idea that it happened randomly and that's they would try to avoid that in only recently more and more discoveries around photosynthesis which probably requires quantum tunneling and then the smell and the this fact that the birds can see the direction of polarization of light and like where is North Pole this all can be described only through the quantum properties

Starting point is 01:41:30 of some processes which happen inside of life so biggest discovery which we personally like it's the last discovery you know like it's always like that it's like the entire concept that our consciousness work through the quantum

Starting point is 01:41:46 compute inside every single neuron. Every single neuron is sort of a qubit. It's like a quantum state machine itself, which then combined in the network produce all the results, but every neuron is quantum state machine. This can actually explain a lot about our psychology, about how we think, how our consciousness works. But also it can give humanity a lot of clues how to build proper quantum computers. So currently the quantum computers which we build, like Google builds or Microsoft builds, they all require some really complicated environments. So you need to froze the computers to like minus 270 degrees.

Starting point is 01:42:27 Fully isolated from any chaotic fields and stuff. So it's really complicated. While if our parents write in every cell. Every cell in our body has a quantum. This process is happening at room temperature. So we can actually look at how biology made it and then build a new class of quantum computers which can actually be in your watch.

Starting point is 01:42:52 And then this can accelerate personal AI development, not the corporation's big AI, but the one which would be with you always and things like that. Plus there is a chance also as well that if these processes are happening inside of the cell, the answer to a room temperature superconductors can also be there somewhere. I know that recently there was this entire hype with the supposedly discovery of the room temperature superconductors. It seems that it didn't work this time fully, but we all were so excited because it can change everything.

Starting point is 01:43:31 Understanding the quantum levitation, all roads can be done from superconductors, if all roads can be done. Then we have flying cars. The same roads can then become the electric network, which distributes electricity around the globe from sustainable sources of energy, like solar panels. We have days somewhere each hour, all the time. And if the superconductors can surround the planet, then we have electricity everywhere without the losing of power.

Starting point is 01:44:08 Lots of stuff can come from the superconductors. The answer can be inside of ourselves. Yes, so the biggest discovery was that the answer can be inside of the cells. If we can actually look at the properties of these nanotubes, they are really special. Right now, there are a lot of discoveries showing that these nanotubes have properties which no one would expect that they would have, even though we all know about physics that sort, the cytoskeleton nanotubes, microtubulars, they can capture photons. They can capture light and direct it within its structure.

Starting point is 01:44:55 As the light actually hits the microtubular, the photon goes inside the tube and then like as if it's a cord which captures the light and then... So a lot of really unexpected and great properties which can be used in industries and which can be used by humanity to to just accelerate our developments what is important that they just realize that to achieve that we need to be interdisciplinary and we need to combine through Through the last years, he was a promoter that he believed that in schools, we should teach kids like that. So, like, not to teach

Starting point is 01:45:29 like physics and chemistry and like biology, but teach all together and show how all this is interconnected. So, we need to kind of grow a new generation of scientists who wouldn't be so silent in disciplines.

Starting point is 01:45:46 All right, so I want to segue to the ideas that you guys are currently most excited about. Thank you for explaining all that. I could spend hours just digging into what you just said, maybe another time. But since you mentioned teaching, which relates to learning, how would you teach kids to code or people to code versus how it's maybe currently taught?

Starting point is 01:46:09 So first of all, we saw that computer science historically emerged from mathematics. And geeky minds like ours. And so it's really great for us, but for most people, it's really alienating because if you're not good in math, you, mathematics, you will just avoid even

Starting point is 01:46:31 learning because you will think that you are not really great at that. In reality, coding is much closer to learning French or Japanese. It's actually easier. A friend of mine published a small book which was basically code as poetry.

Starting point is 01:46:48 That's interesting. Can you share it? Because we actually also wrote a tiny book like code as language. Sure, I'll find it for you. I'm not sure if he published it, but he gave it away as a gift. Matt Mullenweg, who's the founder and CEO of Automatic and was one of the lead

Starting point is 01:47:03 developers, arguably the lead developer of WordPress. Probably need to combine our thoughts in one book and then publish it. I'll find it for you. I created, during pandemic, had some additional time, so I created an interactive book where you learn that you can actually first

Starting point is 01:47:21 type something in a normal language, description of the world, and then it can be easily translated by you into a coding language, like Python or C++ or Swift. It's literally like a translation. First, you wrote it in your own language and then you translate it into the code.

Starting point is 01:47:43 So the only thing which you need to learn is this a little bit different way to describe the world. And that's what mostly you should learn. You shouldn't learn the words and the impunctuation and the orthographics of this language. And if you use these methods to learn, then you can actually code in any language. Because it appears that Swift or C++, they're all the same, they're all interchangeable. Every time when I interview an engineer and this engineer would say that, oh, I know only this language, this would be a red flag for me, because it means that you don't really understand. And all these languages, they're almost the same. Yes, there are nuances, but you almost don't have tasks

Starting point is 01:48:26 which actually require you to use these nuances. But if you understand the meta language, and this meta language is really close to real human, natural language, then you can actually code in any language. And that's what we really promote, and we happen to actually teach some people coding who would never think that they can code and who would think that mathematic is not there

Starting point is 01:48:51 like moms of two housewives and they are great because they are great in language and if you are great in language you can actually learn this language as well especially right now even though yes chat GPTs of the world,

Starting point is 01:49:06 they can code for yourself. But if you know how to code, you will be well off in the next 20 years, 10, 20 years. So for people who are listening, if they are resonating with what you're saying. So for instance, I'm a casualty of mathematics. I was actually very good at math. My brother also very good at math. And we had very different experiences with teachers. So he had a few great teachers, and I had one very, very angry, kind of abusive teacher. And so I said, no more math for me, even though I was innately quite good at it. He kept going and got PhD into statistics. And he's very math capable. But I developed an adolescent onset allergy. But I recognize the beauty and elegance and value of code. I don't think I would ever use it

Starting point is 01:49:54 as a profession, but I like the idea of testing myself. But I've always struggled with trying to identify how to start. And I've looked at AI as maybe a way to use an intermediary so I can use natural language to do some type of coding. But how would you suggest to someone who is interested, maybe a little nervous, but would like to explore coding? There is a free book on our Instagram. There is a link which you can try. It's definitely only the first step,

Starting point is 01:50:22 then you will need to learn more. But at least through the step, our expectations that you will stop being nervous and afraid of coding. And it would be more natural for you. That's why we wrote this book, just to make it easy. Because I don't like any other courses,

Starting point is 01:50:39 because they all start with syntaxes, etc. It's not the way you start to there are great they are great courses it's just like not the way you start because you alienate people who are like oh function what is function I don't know anything about coding but it's the same with foreign languages right I mean it's

Starting point is 01:50:57 like you see the way that they're taught and it's like okay here's a huge table of conjugations memorize this and people are like ah no thanks I'm out here's a comic book like let's look at is a huge table of conjugations. Memorize this. And people are like, ah, no thanks. I'm out. I'm out. Exactly. No, no, here's a comic book. Let's look at some things that you can use immediately.

Starting point is 01:51:09 Make it fun. And then later we can do the harder stuff. And also what we found, and that's how we learn how to code, is that usually when you learn language, you first read, not write. You read. And you need to read some easy but good written book to learn the language. Software engineering is the same.

Starting point is 01:51:31 Like we actually... We mocked an Instagram application. We wrote a clean code of a simple Instagram application. Everyone knows what it is and everyone understands how it works. So if you read this code, you understand what... And then in the middle of the course, you're just, okay, now change. Now change some stuff in the code and you will see the changes in the app. And as you change the parts of the code, you see the changes in the app and you're like,

Starting point is 01:51:57 oh, that's how it works. Also positive feedback. Yes. And also, even if you decide not to be an engineer, even, for example, if you're a product person, product manager, or marketing person, it's really important for you to understand. Otherwise, you won't be able to give properly the tasks to engineers.

Starting point is 01:52:18 You won't be able to manage engineers, and you're losing a lot of opportunities. You will always be triggered by engineers because you will ask them to do something, but they will do something really different if you don't really understand their language. But as soon as you do, it's actually... I wish we had more time and more eager to actually finish the full course, but it's absolutely not the primarily goal you know like hectic life as well so but i'll link to that in the show notes so that people are interested can at least find it and give it a shot i might do the same thing so ideas exciting ideas exciting ideas could be projects could be missions could be, just things that have you both feeling excited and

Starting point is 01:53:06 motivated. First, observations, which we have about the world. And this observation gave us a different perspective. And this perspective is almost obviously led us to some ideas. And then usually when we have ideas, these ideas exist in us for some years and then we try to crystallize them in the project. Product. One of the major observations which actually started from bankruptcy of a game

Starting point is 01:53:36 development studio. We really wanted to understand what was that. What the hell happened with the financial crisis? How we missed it. Not that we missed it. Like we saw that there was like a problem in the real estate market, but everything collapsed around real estate market. We thought that just real estate market will collapse,

Starting point is 01:53:56 but everything collapsed. Little did we know about how the financial market works. Yes. So then we dig deeper in get first we got to the same conclusion conclusions that that everyone like economists derivatives credit default swaps this all lads to this bubble subprimes like all this stuff yes people usually like when it's about derivative and credit default swaps everyone blamed bankers like. Like, oh, bankers, they made this deregulation, they are the problem,

Starting point is 01:54:27 and that's how it all happens. But we usually, every time when we have a statement, we check it with data. And we decide who was the actual beneficiary of the credit default swaps. Not of their fault, but

Starting point is 01:54:43 of them being created and popularized that way. And then we realized that most of the credit default swaps through some vehicles, they were owned by pension funds. And we're like, what? Because we're from a region where pension funds really... Really?

Starting point is 01:55:00 Well, pensioners are really poor people. And you would never think that they own some multi-trillion dollar... Huge. Yes. Huge. Pensions in the United States are like, what is it? $40 trillion. $40 trillion.

Starting point is 01:55:16 It's more than the entire publicly traded market combined. You will combine all Apple, Google, Exxon, Walmart. You will combine all these companies. It's smaller than the assets of pension funds. Altogether, less than the assets of pension funds. So, through this prism, we started to learn more and more, like how the hell it happened. And it was a great invention.

Starting point is 01:55:38 I mean, the fact that the United States is the greatest economy in the world is because of this. It's because of people actually were saving some big chunk of their money and the money was not just saved but was invested into the market. And that's how market got all the

Starting point is 01:55:54 capital to grow, etc. But then we realized that unfortunately as soon as this population not only grew to the amount that they are the majority of voters, but

Starting point is 01:56:09 also they have this enormous financial power. The financial power which never existed before. The banks, the bigger than any other organization. So this financial power and this voting power... Together combined, led to a lot of popular political decisions and regulations, which was completely false.

Starting point is 01:56:32 What types of things? We can give you some taste of it. Yeah, for example, when we first came to the United States, we learned about student debt. And for you, it's obvious. It's the United States. Everything is commercial. That's why college is not free. That's how we got to the student debt. But the student debt, if you look at the size before 2000,

Starting point is 01:56:56 it was really a small problem. It's now like $2 trillion. But before that, it was a much, much, much, much smaller problem. And what we realized is that previously, like in the 80s, your tuition when you go to state college would be mostly subsidized by government. Like 90% of your tuition would be subsidized by government. That's how your parents were able to actually pay for their tuition during the summer job, like through the summer job.

Starting point is 01:57:26 And that's how the debt never accumulated as much. But in late 80s, beginning of 90s, because of almost bankruptcy state of public pension funds, the governments in different states and in federal level as well made a decision to not only bail out, but also for the future, protect these pension funds. For example, in California,

Starting point is 01:57:55 the growth of public pension funds, including teachers' funds, guaranteed on a level of 7.8% a year. Imagine that your deficit would be guaranteed at this level. A state budget. And it's not even average. A state budget. So the subsidies to education went down as a result.

Starting point is 01:58:13 Yes. Exactly. You can see tons of information become publicly available online. You can trace it. You can trace it. It's all there. Tons of data. But if you like to dig into this data, you can find it.

Starting point is 01:58:24 It's just there. You can see it. But if you like to dig into this data, you can find it. It's just there. You can see it. You can like, oh, right, the money goes into the education and then to the pension fund. Like CalSper's in California. Yes, it's a public pension fund of public workers and pension fund of teachers of California.

Starting point is 01:58:41 No one really realized the size of these funds. And no one realized realized the size of these funds and no one really realized the gap in between assets and liabilities of these funds so when everyone

Starting point is 01:58:54 discusses that the pension funds are underfunded it's only public pension funds like 5 trillion dollars of a gap this is accounting the money which is constantly transferred from subsidies to the pension funds. Someone might think that this is just public workers.

Starting point is 01:59:16 They're probably, what, 15% of workforce in the United States, and yet the size of their pension funds is half of all pension funds. Even though it's only 15% of workforce. Why? Because of a guaranteed 7.8% annual growth. Because when the rest of the market goes down, up, down, up... So, and this problem is not only in education. If you look at the police, you know, there was this big movement of unfunding police.

Starting point is 01:59:44 And we looked at the budgets. And per person in LA, for example, per officer in LA, it's almost like 250,000, 250,000 a year. And people were very angry about that. Like, what the hell? Like, we pay you a lot and like, you're not doing your job. The real workers right now and the real officers right now are not paid as much. And they get only a tiny portion of it. And most of it goes to the transfer for pension funds for

Starting point is 02:00:11 officers who worked 30 years ago. So where does this lead? You guys are looking at the data and I suppose like a good set of data ideally allows you to have some predictive ability or at least speculation ability. So what do you do with this? Zooming out to a larger picture, what it led to is that through the generations, starting from boomers, I know this is like a false science about dividing people into these generations, but we can buy the bench. People who was born around 50s. Yes, so let's say. The boomers, as they were getting into 30 years old

Starting point is 02:00:48 on average as a generation, owned something around 21, 23% of national wealth in the United States. That following generation, Gen Xs, at the same average age, owned around 7. Us, the millennials, by the same age owned only less than 3%, like 2.8

Starting point is 02:01:10 ish. And then the trajectory shows us that together with the crisis which happened during the COVID, we can expect that the next generation after us, the Gen Z, are going to be in debt by the same average age. On average, as a generation, they're still going to be in debt by the same average age.

Starting point is 02:01:26 On average, as a generation, they're still going to be in debt. So trajectory really bad. And also what they've created, if these young people, not if, when they realize that the social agreement is not working, social structures will start to fall apart.

Starting point is 02:01:43 What do you think are some likely ways that that will show up? We will see like the new wave of unions, protests, people not working, economies slowing down, this stuff. New businesses not created. We can see from the statistics that over the last 10 years, the share of the new businesses created in the United States, and in the United States, lots of new businesses created every year. Lots of them

Starting point is 02:02:07 never survive the year, but that's the case. You create many, many, many businesses, and lots of them die, and some of them survive, and that's the economy. So the share of the new businesses created annually in the United States by the people under 30 years old

Starting point is 02:02:23 used to be 40% or 45, let's say 40. And now 10 years later, now it's a 30. It's down 10%. It's the same number of companies being built just by younger and older, or is the total number? More companies, the total number is sort of the same. It's just like not young people creating them.

Starting point is 02:02:44 It's people 55 plus creating them. That's surprising. That's surprising. And you know what I would expect? I never checked the data, but my intuition tells me all those businesses are just real estate. People buying houses and renting them out. So nothing new is created. Just the spike in the price in real estate is just because of

Starting point is 02:03:06 buying and renting out and those are the new businesses there are a lot of problems but still when you talk about the problems it's really important to at least propose some solutions in what we saw because we realized that this shift is based on regulations

Starting point is 02:03:22 it's not natural that this shift is happening. It's a regulation. That's the rules which were set by the previous generations which are making this constant transfer. We realized that if you would decipher these regulations, what they did, that they made a preference to equity,

Starting point is 02:03:43 like shares of the companies, et cetera, compared to the income. So capital gain is taxed less. There are a lot of things which actually made the huge difference between equity, how equity is treated by the regulation and by the market, and how personal income. Got it, right. The taxation, the incentives, everything is set. Everything. The pension funds can incentives, everything is set. The pension funds can invest in that, but they cannot

Starting point is 02:04:07 invest in that, and things like that. There are limitations set, not naturally. If you have all the capital, like the majority of the capital is pension capital, then where it can be invested matters a lot. Sure.

Starting point is 02:04:21 In this term, we realize that the solution which we can test and propose At least try. is to try to convert income Individual income. into securities. Okay, so this is where the Lieberman's company comes in? Yes. First of all, we did this to ourselves. As a scientist, you need to make the experiments, and the experiments first. I wish more scientists did this.

Starting point is 02:04:51 You've got to be the first monkey shot into space. Yes, exactly. At less than three Gs. So even though our income is not stable, but if you will build a model around all the founders, all tech founders, and the probabilities of successes during the period of time. We can build an income model like you would do with a company projections.

Starting point is 02:05:13 Risk-weighted, risk-adjusted cash flow projection of an entrepreneur? And then based on this projections, you can actually set a price for a company which would have the same type of income. In this case, if you can form the company, then you can attract investment the same way companies do. And in this case, you will eliminate this bias and vice versa will be supercharged by improving your future. So supercharged, just to try to ensure I'm hearing you correctly. So supercharged meaning

Starting point is 02:05:50 if you're showing a decent rate of growth, even though you're capital constrained, if you can bring in equity investors who invest in you as if you were a company, you can accelerate your growth and potential. And then we can average this as an index, as an index across some cohorts of specific professions or specific cohorts like students, for example, you have higher education or you don't have higher education. How does it change your average income in the United States? Should we invest in every kid to have the good higher education for them to increase their individual income? And that's where investors get their money back?

Starting point is 02:06:35 Or should we just leave it the way it is right now with the loan, which then suppresses the wheel to go and risk? And that's how young people don't create new businesses and just go find a job. So how do you think you incentivize this type of wider adoption and data sharing, right? Because I can imagine if let's just say we flash forward and this has been widely adopted. Now I can choose, do I want to invest in people who are getting accounting degrees, or maybe I have a more reliable return on my investment year on year? Or do I want to invest in the growth stocks that have much higher volatility,

Starting point is 02:07:11 like the entrepreneurs of a certain class or maybe age bracket, where it's going to be a much riskier by volatility measurements investment, but who knows, the gains could be higher. How do you go from a single proof of concept? I have also questions about taxation, just if you're being taxed at an ordinary income level, how you translate that effectively to equity holders who might be your investors,

Starting point is 02:07:36 let's just say. But we could tackle any one of those. So it could be like, how do you contend with maybe the handicap of having ordinary income taxed, even though that's presumably what people are investing in on some level, like the discounted cash flow or whatever. And then how do you take this and encourage other people to experiment with it? We start with ourselves as tech entrepreneurs, because most of our income comes from building companies and selling companies or making companies. It's even today. There is no difference whether you registered this company

Starting point is 02:08:10 under your name or you registered this company under a holding company name. That's a great point. You guys are actually operating in a very, in an easier case, straightforward case, because most of your gains would be from companies from companies therefore likely long-term capital gains maybe you have like that's usbs exclusions etc versus if you guys were like very high paid lawyers or something it could get a lot trickier yes we went through

Starting point is 02:08:36 that example thousands of entrepreneurs can actually show in their example that it works for the investors and then if it works for the investors. And then if it works for the investors, then we can introduce new regulations, which will make it work for the professionals. Let's say software engineers, doctors, lawyers. And from there go to even wider groups, like students. There need to be even more regulations

Starting point is 02:09:01 because kids need to be protected and stuff like this. It's all possible to be done. So we're pretty sure that at least some politicians will see that their voters can benefit out of it and that they can actually live a better life and the problems like student debts can be solved in just really short term by the tools like that. We hope that some rules will change. Right now, most of the pension funds are invested in really bubbled, overpriced assets,

Starting point is 02:09:35 just because it's too much money and not that much of instruments, like financial instruments, to actually generate the growth. That's why they needed this credit for swaps and such because they need this derivatives because it was just too much money to invest. And so if they can be invested in people, everyone will win. Like pension funds will win, like people will win.

Starting point is 02:10:00 It's just the growth of the economy would be much faster. It's likely going to be 10 times larger market to invest in when we start investing in individual income as equity. What do you say

Starting point is 02:10:14 to people who think about this and they're like, okay, I'm sure there are cases where this would be very attractive, at least initially. So you might have somebody like a very promising YouTuber, they want to build out a studio and hire. I guess they could go out and raise like an equity round. That's what we did.

Starting point is 02:10:30 Okay. But with individual income, like into YouTubers. Okay. So how now do you think if somebody is really successful that they would try to renegotiate or that they would not try to renegotiate? There is an example. It's not us it was before us there is a fund which invested in college athletes and they proposed to every

Starting point is 02:10:53 college athlete they took the statistics because it's quite statistical it's like a moneyball type of a game like they they calculated their way to understanding how to predict and they how many students they should invest in, in order to basically hit the... Have a couple of LeBron James. Exactly. Yes, and they offered every student around like... The same price.

Starting point is 02:11:12 5-10% investment. We're buying 5-10% of your future income, and we pay you the same price. It's $10 million of... So half a million, million. Relation. 5-10%. 70 students

Starting point is 02:11:26 agreed. One of them already netted a 15 years contract for $350 million. So they did great with the fund. Yeah, they did pretty well. There is one athlete who tried to challenge this agreement in court.

Starting point is 02:11:41 This one athlete challenged? Was it the same athlete? No, This one, there is a great interview of him where he explains that this money actually helped him a lot. Best decision in his life.

Starting point is 02:11:51 And he would never do another decision. I'm just imagining he might be cool with it, but I'm thinking about the managers and the agents who are like, what the fuck is this?

Starting point is 02:11:59 But it worked out. Yes, it worked out. For everyone. But there is another athlete who netted like three, four4 million a year type of contract. He tried to challenge this in the court. And everything in this case is more complicated than with our case. He was 16 when he signed.

Starting point is 02:12:18 English wasn't his main language. And things like that. So he signed and still court was on the side of investors. Upheld the agreement. How can people find more about this particular example if they wanted to google something? I will send you the link. You can send it to me and we'll put it in the show notes.

Starting point is 02:12:35 I think it was in Wall Street Journal, the description of all these cases, but also I can send you the links to the court case because all the court cases they open so you can see all the arguments. And arguments of the court, they were about the fact that he did well. So it's not about investors taking the last thing of you, I think like that. So he did well. And also investors described all the scenarios. There is a scenario in the agreement that there is a scenario that you will do well,

Starting point is 02:13:07 and in this case, we'll get this amount of money. So they described all the scenarios. Precisely described. Moreover, I don't remember what was in their contract, but in our contract, when we… With your investors. With our investors, and when we invest in other people ourselves. We also invest in other founders. We also invested already in around a dozen people.

Starting point is 02:13:25 We have this... Minimal sum, which we don't touch. Minimal income of yours, before which we're not getting anything. Okay, yeah, there's a hurdle, right? There's a hurdle. We actually aim to have the outliers. It's a power law distribution. It's a power law.

Starting point is 02:13:40 In most of industries, there is this power law. It's not only in tech. It's just in art in podcasts and like our opinion about this like we will all win the market will win society will win humanity will win from the fact that we will use this power law for wider groups of people to invest in them provide them capital and provide them chance to get a higher education, to try to start a business. So question about your investments, to the extent that, and we can look at it at least two different ways. So one could be

Starting point is 02:14:15 your investors and why they chose to invest in you guys. But since you guys made the decisions about your investments, I'm curious about those people to what extent did you choose them based on their earning potential and so on versus their potential to be a good ambassador or story for this model because they both seem to matter yes now we so like a good investment may have the financial roi but there's also showcasing... Obviously, because we have not that much money to invest in every people we want, we needed to pick those who will be a good story. So definitely we look at both.

Starting point is 02:14:53 So in terms of investors in us, the first investor who supported us... He did not allow us to back off. Like, how to say, back up. Yeah, yeah. And we were almost ready to say like to give up it's like okay we're not doing this and you're like no no no guys you have to do this like please some lesson he actually had the similar idea when he was out of high school in 2001 he is one of the

Starting point is 02:15:18 genial partners of slow ventures so he invested in us but then other prominent names like Mark Andreessen or Chris Dixon or Josh Kushner, they also now invested a tiny share of the Libermans, but we earned it. It didn't work right away, but we made the first round, then we proved some results, then we made the second round. So like with the startups. So when we invest, for us, definitely it means a lot that we want to find really great examples because all these examples will affect the future of the idea

Starting point is 02:15:52 and this will help others to get access to the same type of resources. But what's more important for us, the major thing is whether we believe, and this is intuition, if the person will continue building after failing. Yeah, that's a big one. That's a big one, right? Because you're not just investing in one company or one idea. Yes, we don't invest in one company. Moreover, we would come and already did this through the last year and a half as we're investing in people.

Starting point is 02:16:19 We came to people and said like, quit it, drop it. I mean, that's not worth your time. It's not working. Like, switch to something new. You will never hear about this. You will never ever hear something like that from the investor who invested in this particular company. If I invested in you personally, I am mostly interested in your success.

Starting point is 02:16:38 And if you are, like, locked yourself into something which you're like, no, no, no, I got to do this. Like, this is failure. It's not failure. It's not failure. It's an attempt. 70% of those attempts are going to end up with zero. So just move on. Start next one.

Starting point is 02:16:53 You'll be successful later. With Sam, it's probably our best relationship with the investors ever. So because it can be really open in not just you know like showing the good results but also showing the things which are not working struggles because now we like in a different type of relationship and we really

Starting point is 02:17:14 like it and we actually we had challenging experiences with investors I don't think Sam's gonna take you in any basements seems unlikely so but not even that he's fully supporting us

Starting point is 02:17:31 the same when we invest so we understand that some of the founders who invest they already failed with their current projects and they started the new one and we were the ones who support them through this process some of them are coming through hard times and we would say go for a sabbatical go to the bus go to the bus like take care of yourself like you need to be super efficient and you need to be like happy with your own life

Starting point is 02:17:55 long term this will score us much more than if you're like we'll destroy yourself right now yes and we already have really beautiful examples when founders were able, through this freedom, were able to act the way they wouldn't act. And it already gave them results. Like we completely enjoin with the passes of all the people who we invested in. And they're all very different.

Starting point is 02:18:23 Different stories, different individuals, the people who we invested in and they're all very different different stories different individuals different uh spheres like it's everywhere from youtuber to like uh reinventing quantum physics yes and with youtuber marina uh she is actually really also awesome example she is a founder she had the startup but to create a marketing vehicle for the startup she created a YouTube channel and then this YouTube channel media empire becoming like a much

Starting point is 02:18:53 larger thing than the startup making like a million plus a year but a mortgage, family, kids it's all risk which you like you wouldn't bet all of your income to the growth. Yes, she was growing fast. But as soon as she got the understanding that she can use the capital from her future,

Starting point is 02:19:17 literally, this is what we are doing. This is capital from your future. If you are doing as you are doing right now, then clearly you're going to have that amount of money in the future you can take part of this money which already almost exists into the current into the present time and use it in order to make your future even more successful so this brings up something that i wasn't sure we would get to but i figure i can bring it up time machine is it possible well there's the time machine but there's also maybe the and i go back and forth on how i feel about this but the i guess we could you could look to the data if you have such data and there is some it would seem but the maybe the over fetishizing

Starting point is 02:19:57 of suffering and how that contributes to success or the belief that the more one struggles the more likely you are to have outside success because those make for good stories, right? Somebody suffers for their whole life and then they show how much they can persevere and then they succeed. But if you look at some of the examples that you mentioned earlier of like the dropout and then the big company, these are not stories of abject suffering from the early stages of childhood, generally. So would you say, and this is tying it to what you just said, that by relieving some of those pressures with the mortgage and the kids, you're improving the likelihood of a bigger success later?

Starting point is 02:20:39 Or somebody could certainly look at it and say, well, she's not going to be as hungry. So we have lots to say about this subject that's why i'm asking um a if we will look at the most successful experiment of all times for the humanity providing free school education free school education for everyone doesn't matter whether they're a smartest kid on the street or not like every kid gave us more than any other investment which we which we as a humanity like infrastructures and stuff no providing free education is this like a capital early on it was a controversial idea like 100 years ago it's an expensive investment to provide education for every kid expensive investment and we scored a beautiful world gave a lot to us so providing a little bit

Starting point is 02:21:34 more of the same can give us unexpected results the different perspective is if we look at majority of the unicorns created in the united states and look at who were the founders of those companies your company's worth a billion or more those companies worth a billion or more or more a big share of them like most of them are from upper middle class families they never struggled as us you know like they never went through real poverty type of situation. Losing all the money on the bank accounts and stuff like this. All the stories about dropouts

Starting point is 02:22:11 from college. They never had the student debt. Parents paid for their college and that's how they afforded to do that. The other thing that gets left out of those stories is when you drop out of a fancy school, they always let you come back generally it's not like you burn the ships behind you exactly and then the last one

Starting point is 02:22:31 my problem not the last one but the one also the last one for me then david will tell something the struggle will come it doesn't matter if you have millions of dollars, you will always be struggling because you strive to achieve more and it's challenging and it's not necessary that the struggle is needed, but it will be there. Yeah. It doesn't matter if you're like rich or not. Like what was this? Rich people also cry.

Starting point is 02:23:07 Not going to wear that t-shirt around, but yeah, I mean, that's true. And the challenge comes, especially when you started a startup. You wanted to succeed, but then... I mean, also human nature is human nature. Life is suffering. It's going to find you, don't worry. Sensara, I'm still here. But in general, with this argument,

Starting point is 02:23:25 we hear a lot that founders should struggle. So we struggled a lot through our founders' path. We were like having no resources. In the country where investments are always considered as a debt, you need to put as a collateral your house and things like that compared to San Francisco where there is no collateral you can have a salary

Starting point is 02:23:51 in our case we were prohibited to have a salary as the founders you should have the skin in the game they said no salary that's hardcore so hardcore if you compare this experience with Silicon Valley experience, this is a struggle. Not a struggle at all.

Starting point is 02:24:10 So most of the successful companies you know would never exist without venture capital. Venture capital is money in advance. It's actually not struggling. Struggling is like having the cash flow and building your bootstrap business. Most of the companies are not like that because some levels of achievements,

Starting point is 02:24:34 at least in some areas, they require this freedom for you to actually risk and to try things. That's why we believe that some struggle is needed, but we believe that not on the level we have right now. You don't have to manufacture it. And there will always be competition. But student loan, which just stops most of the young people

Starting point is 02:24:59 in the United States from actually taking the risks early and to achieve more. And later, too. I know people in their 30s who still haven't paid off their... states from actually taking the risks early and to achieve more and later and later too i mean i know people in their 30s who still haven't paid off their you know and i'm talking not talking early 30s like mid later 30s especially if they go to like an extended graduate school or professional school they're still paying off student debt this is a needed struggle this is really an optimal not needed uh artificial struggle because we know that the subsidized money is paid by tax through taxes by people but it's just spent on a different stuff

Starting point is 02:25:34 so we don't believe in this idea that the struggle is needed and vice versa we believe that the different local maximum which would be much higher in terms of the size of the economy, is in the place where we removed some of the struggles, especially those which are artificial. Just try to imagine what it is 10 times higher. More electricity, more power, more roads, more cars, more education, more everything everything 10 times more everything this is when the abundance is probably likely to be close to reality and that's what we can do in

Starting point is 02:26:17 this new local maximum if we just change the perspective on what's worse to invest in? Shares for... The individual income or the undying companies? The companies are dying. On average, they live actually less than human beings. All the statistics is for people in their potential, but all the regulations are actually supporting for companies and shares yes it's obvious why it's this way because in the past we needed this invention of limited liability companies in order to like remove the personal obligations obligations individual obligations over the

Starting point is 02:27:00 business like when your ship is sunk in the sea now you own not only you all of your money your house but your family can be taken and enslaved like we are far away from this world like hundreds of years away from this world now we can through the innovation of like limited liability and then the public market and this is all innovation in in the way how we see the market and the way we look at the market but we are ready for the new innovation and this new innovation can like uplift the economy so question for you guys i'll answer it first too so what would you what request would you like to make of my audience so very diverse audience across many countries many places most of them are interested on some level in technology not all of them uh well let's be honest all humans are interested

Starting point is 02:27:51 in technology they just might not recognize it as technology as i said like human and libelous is a technology right if we all use tools that's the reason it's a reason that homo sapiens have done what they've done, good and bad. But my request for my audience would be to send me links to some of the biological and biophysics topics that you both discussed earlier. Very interested in all of that, including quantum effects and potentially bird vision or olfaction. All of this is of great interest to me. So people can shoot those to me on Twitter at T Ferris or elsewhere. But what requests would you like to make of my audience or places you'd like to point them?

Starting point is 02:28:38 Anything at all? Two things. First, there is a conference about quantum biology near San Diego in the 20s, like 18th of August. All right, here we go. The best scientists right now are gathering. It's still quite a small group of people. That's why they're really supportive to each other. They should compete with each other, but they actually are quite supportive to each other.

Starting point is 02:29:02 We will be in the conference as well but what we would ask is actually first to think who would be those individuals you would invest in like all of us have someone who we like this guy is going to be very successful second is send this information out to us so So if you know the person, you would invest, you would invest, you would invest your money in like, probably we all let us know. And the third one is think that maybe you should invest in this person as

Starting point is 02:29:35 well. You're like, maybe it's your kid and you're a parent and maybe you should make an agreement and actually invest in the person. Our agreement is publicly available online. You can all read it and check what's the closest in there. Like you can use this. And that's Liebermans.co?

Starting point is 02:29:52 Yes, there is an agreement there. So I would say that this is your request. So first think about these people you would invest in, send out the information about them to us. So what is just being cognizant of the fact that this is a large audience, so sometimes not good to give out your private email. I've had people do that.

Starting point is 02:30:14 I warn them about it. How should people notify you? We have a form. You have a form. Yes, we have a form. And that's humanism.is. Humanism is? Humanism.is.is humanism is humanism.is.is and also we communicate quite extensively through instagram usually we you know like we use instagram million people will come

Starting point is 02:30:36 usually we use instagram not for pictures but for larger texts in some of the ideas. That's Instagram.com slash Liebermans. Liebermans. L-I-B-E-R-M-A-N-S. Also, same spelling, Liebermans.co. Just telling people. All right. So Instagram, the form at humanism.is. And people can find the agreement.

Starting point is 02:31:00 On the Liebermans. Liebermans.co. The other ask can be, if we truly want to see this world happening, we need to educate the older population and the investors and the grandmas and grandpas who actually are shareholders, stakeholders in the pension funds. We need to educate those people who actually own most of the money in the country to gradually start investing in this type of agreements,

Starting point is 02:31:32 to at least check, to see what's going to happen in five, 10 years from now, if they're going to make more money by investing in individual income rather than private companies, public companies. And in this case, we will be able to have an experiment. And if it's a successful experiment, we will educate country and market to shift towards this. Yes, you can ask your grandma to look where the pension money of her are invested. And to see that probably some companies

Starting point is 02:32:04 will all blame for some problems in the world, they can be the investors. But actually companies which affect our ecosystem in a bad way, they are not owned by bankers or rich people. They actually, most of them, like 90% owned by pension funds. So if we can educate our previous generations

Starting point is 02:32:31 that they can be the problem. They're the shareholders in the problem. They're not the source of the problem. Or they're shareholders in the future and they have to choose how their money is influencing them. And they can't be the shareholders of the future. This is a heritage they can leave. Destroying the planet or actually switching. choose yes how their money is influencing the shareholder of the future and all of us heritage they can leave destroying the planet or actually switching i would imagine 99.9 of them have no

Starting point is 02:32:50 idea that they can control it that they have a choice yes and they have that's the funniest part they can log in and they can actually change let's sit down with your grandma maybe look at their like i do want some share of my pension funds to be invested, of my savings to be invested in the individuals,

Starting point is 02:33:08 corporations. Or in sustainable companies at least. This education should happen, otherwise there is this belief that

Starting point is 02:33:16 they did, this generation did everything right and just the new generation has failed. But it's really important to educate

Starting point is 02:33:24 that some decisions which were made 30 years ago affect us a lot today. And some of this effect can be changed if we change where the money is invested. And where the knowledge is. Yeah, I think a lot of it is a communications problem and an education problem. And that net-net humans of different generations have more in common than they have different amongst them.

Starting point is 02:33:54 But as you pointed out, sometimes the problems aren't obvious. And sometimes problems aren't discussed and the options aren't discussed right the fact that i didn't know this until i mean shockingly recently for me like 10 years ago that i could with retirement accounts you can invest in privately held companies and all sorts of other things it is an option it's just not readily done exploited by most people because they don't realize that it's on the menu so i'm excited to see what people come up with. Maybe someone needs to make a startup which actually offers a solution

Starting point is 02:34:29 for the pensioners to do it easier. Yeah. To just do the sustainable companies. Some type of interface that makes it less manual, less one-on-one. Yeah, yeah. Because right now it is hard. You need to spend some time

Starting point is 02:34:43 to actually set up your account properly. But that now it is hard. You need to spend some time to actually set up your account properly. But this is the greatest opportunity. We just need all to talk about this. If you have some challenges believing in this, A, you can make your own research on trying to understand whether we are right with our data and

Starting point is 02:34:59 our points of view. B, you can ask a question in the form. You can find a way to reach us out and ask a question in in the form you can like find find a way to reach us out and ask a question so we will explain how we see this and why we believe this is actually actually the really really really good way of investing your money well also i mean it the this conversation has raised so many good questions i mean one of which is like how do you take capital which is a you know it's a capital, which is a, you know, it's a currency, like it's something that you can exchange for other things that is currently locked

Starting point is 02:35:29 in a somewhat static form that may not be generating much positive value in the world. And how do you liberate that for other faster growing, more dynamic sources of value, not just for the individual but for the community for society and i mean i think about that a lot i mean it's asset allocation but on sort of a karmically considered level at least at the collective and you don't need to spend the money which you need right now it is money which... You will only get access in 30 years from now. So we made an experiment. When we joined Snap it was the first time in our life when we got 401k.

Starting point is 02:36:10 First time in our life employed. Yes. So Snap acquired us, we are employed, we now have 401k and the experiment was we are getting exactly the same salary, exactly the same savings in the 401k account of

Starting point is 02:36:25 both of us. David changed everything in his account, where the money is allocated, towards more sustainable companies. Companies caring about the planet. Like Perkins and Gamble and Coca-Cola.

Starting point is 02:36:42 Yeah, exactly. And the Monsantos of the world, removing them from there and just like shifting the investment towards the companies which are more sustainable. Me, I just left everything as it was by default provided by the Fidelity. So far, I earned 20,000 more than Daniel. The growth is 30% higher than mine. So in this, it's just...

Starting point is 02:37:04 That's the funniest part. If you believe that other people believe in the same, that actually the world is moving in a more sustainable, clean society, you will win financially as well. Because if the shift is happening, if you believe in the shift, then... And it should happen,

Starting point is 02:37:20 otherwise we're all going to die. And because it's happening, like naturally, logically, it's happening like naturally logically it's happening then you should it should be no brainer that we should invest in the companies which actually does this because others will lose in the market game yeah it doesn't uh doing right morally doesn't need to mean doing something that is self-destructive you can align the incentives absolutely and investing in your kids in your grandkids is the best thing ever right so i think everybody listening has a good amount to think about and they have options for communicating with you they can go to

Starting point is 02:37:57 liebermans.co to see examples of the agreements right the types of contracts that have this participation and future earnings potential and outcomes of individuals. They can go to humanism.is to fill out a form after they think about which of their friends, which of their peer group, which of their circle they would most invest their own savings into. And they can also consider doing that themselves with the templates that you provided. We've got the Instagram book and course for those interested in exploring coding. And the Instagram is instagram.com slash Liebermans. David, Daniel, thank you so much for taking the time today. It was awesome. Absolute pleasure. Yeah, so much fun to traverse so much ground with you. And for everybody listening, as per usual, we'll have extensive show notes linked to all the resources, everything that was mentioned.

Starting point is 02:38:51 And we'll track down a few things here and there, including links to, might have been in Wall Street Journal, but the sports example. And you can peruse those at your leisure at Tim.blog slash podcast. And until next time, be a little bit kinder than is necessary to others, but also to yourself. And as always, thanks for tuning in. Hey guys, this is Tim again. Just one more thing before you take off. And that is Five Bullet Friday. Would you enjoy getting a short email from me every Friday that provides a little fun

Starting point is 02:39:24 before the weekend? Between one and a half and two million people subscribe to my free newsletter, my super short newsletter called Five Bullet Friday. Easy to sign up, easy to cancel. It is basically a half page that I send out every Friday to share the coolest things I've found or discovered or have started exploring over that week. It's kind of like my diary of cool things. It often includes articles I'm reading, books I'm reading, albums, perhaps, gadgets, gizmos, all sorts of tech tricks and so on that get sent to me by my friends, including a lot of podcast guests. And these strange esoteric things end up in my field, and then I test them, and then I share them with you. So if that sounds fun, again, it's very short, a little tiny bite of goodness before you head off for the weekend, something to

Starting point is 02:40:11 think about. If you'd like to try it out, just go to tim.blog slash Friday, type that into your browser, tim.blog slash Friday, drop in your email and you'll get the very next one. Thanks for listening. This episode is brought to you by Protects Rest Supplement, a new take on getting deeper and more restorative sleep. I was introduced to this by former Navy SEAL Nick Norris, who has been on this podcast. And as a mutual friend of ours put it to me, it's very annoying that Nick has no physical weaknesses. This is somebody who can climb like a spider. He has incredible abilities as a rock climber. He is incredibly strong and can also run ultra marathons.

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The Tim Ferriss Show - #689: The Brothers Who Live One Life — The Incredible Adventures of David and Daniil Liberman

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