This Week in Startups - E1046: News Roundtable! TechCrunch’s Alex Wilhelm & Slow Ventures’ Sam Lessin on COVID’s potential privacy risk, private/public investor outlooks, remote work challenges & at-risk early-stage investors

Episode Date: April 17, 2020

0:37 Jason intro Alex Wilhelm & Sam Lessin & checks in on how their quarantines are going 5:59 Are they all working more during quarantine then they were beforehand? 9:58 Will we see a birthrate drop due to the crisis? 15:45 Having & raising children in the digital age/COVID crisis 18:24 How are Apple & Google helping with tracking COVID-19, and when do their efforts become a privacy risk? 27:29 For how long would big-tech need personal health data? 31:54 Differences between Facebook & Twitter, Twitter usage for Jason, Alex & Sam 37:41 What is Sam working on with Fin? How has he transitioned his team to remote? 39:47 Who will be impacted by the move away from luxurious big-tech campuses? Will it lead to a competitive disadvantage for companies that are hesitant? 56:19 Disconnect between optimistic public investors & pessimistic private investors 1:00:38 Why early-stage investors are most at-risk in the private market? 1:05:33 Misaligned metrics in VC, understanding massive unemployment numbers 1:11:26 Is government-backed healthcare good for capitalism & entrepreneurship?

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Go to Squarespace.com for a free trial. When you're ready to launch, use offer code twist to save 10% off your first purchase of a website or domain. Hey, everybody, welcome to this week in startups. It's our news roundtable. And I am, I think, today's April of 14th. I went into quarantine on March 10th. We went into quarantine here in San Francisco on the Sunday, I think the 15th of March. So I'm losing my mind.

It's been over a month. I am not designed for this. But thankfully, I have you. I have the loyal this week in startups audience. and it's been great. And we started a Slack instance. I think you're supposed to call them a Slack instance. But eventually people will just say I started a Slack, you know, like I started a medium.

Or I started an email. So we started a Slack. 5,500 of you joined in the first 10 days or so. About 50 of you are dirty, rotten spammers trying to get people into the top of the funnel. And I have banned you with prejudice and admonished you in my replies and deleted your original post. So if you're listening to the show and you're a fan of the show and you use the slack as a top of funnel, congratulations. You get to watch the show, but you're never allowed inside the house ever again. That's how I run community. It's like a benevolent dictatorship. Everything's

going to be awesome unless you do that spamming. I think we did something brilliant. We made a Slack room, a channel called offers and promotion. And these idiotic spammers immediately go to offers and promotion and put their spam. Then we search for their name and we see them as they spam other channels and we just banned them. It's a honeypot. It's so brilliant. You're not supposed to tell people about the honey pot, though,

on the show. I'm supposed to keep that secret. I knew I didn't do something right. You were good until then, though. You're good until then. And if you want to join, if you want to join our Slack, and I know many of you do,

you can do it very easily. It takes no effort at all because my people set up a web page. No, they didn't set it up yet. Instead, you can just go nick atlaunch.com. Email nick atlaunch. com.

And tell them what you love about the show what you think could be better, and he will give you a personal invite to the Slack instance. We're not letting people in generally anymore. We're doing it by invite only. And we're going to do our news roundtable. We have Alex Willem with us again. He's Alex, first name club on the Twitter. He's a senior editor at TechCrunch. He was just on the show in March. Welcome back to the program, Alex. How you holding up? Last time I saw you, we were in day 15, I think. Yeah, I'm with you on the not being made for this and kind of going insane. I forgot to cut my hair. I don't know how long we've been in quarantine out here on the

East Coast, it's been one kind of sludgy blur, frankly. And I'm just trying to, like, not gain too much weight before this is over and hopefully hold my work life together. That's about it. It's kind of dull. Do you have kids at home or you're married, but no kids? What's your status in terms of what's going on in the household? Yeah, yeah.

I got married last June. No kids yet. We do have two dogs that we adore. But our house is pretty, we have a lot of space out here because, you know, I'm not in stuff so I can have a lot more room. So we have enough room to not get into their hair too much. We can both work from home and we need to. You're in Rhode Island, right?

Fair remember? Yes, sir. Yes. Beautiful, beautiful country there. Good timing to get out of the city. And they're arresting people from New York trying to get into Rhode Island, right? There was a confuffle about that. But now Rhode Island, and I think we'll get to this in the first topic, but we're

part of like the Eastern State Collective, kind of how California is working with Oregon and Washington. So I think the beef has been settled between Cuomo and our governor, Gina, who's actually doing a pretty good job out here. All right, fantastic. And also with us, Sam Lesson is here. He's part of the last name club on Twitter at Lesson, L-E-S-S-I-N. He's a partner at Slow Ventures. We've got a lot of friends over there at Slow. Do a lot of deals with them. And he's a co-founder of Finn. Welcome to the program, Sam. Thanks for having me. Good to be here. Look at that beautiful shot. Beautiful. Unbelievable, great videos. This is what I've been doing at home is tuning my Zoom settings. Let me ask you a question, because your Zoom looks very strong. You got a, you got a lot. a lavalier. So you're doing Zoom meetings? Are you using that lavalier, Mike, on the Zoom meetings? Yeah. No, I've just gone lav all the time. I like the lab better. I have a shotgun. I've got all sorts of toys, but this is the one I like. The lavalier you like most. Now, when you say

shotgun, we have to ask you, you're talking about a shotgun microphone, right? Not like, you've got full prepper. You haven't gone full prepper. I, you know, I'm not, yeah. I have to admit, I do like guns, but I don't own any. Yeah, it's interesting. I think like toilet paper and guns, first two things to go. Tell us something about America. And how are you holding up? You got family and how has it been being home. Are you losing your mind? You know, I think I'm kind of past that phase. We have our two kids at home. You know, we're very fortunate to have space, you know, at least enough. The kids can run around outside in the backyard a little bit. It's small, but it's functional for a one and three-year-old. And I wouldn't say, I mean, I wouldn't say that

there's no downsides, but I would say that I've kind of gotten through the, uh, the phase of this is climbing the walls and to, you know, look, we're very fortunate and this kind of works. And, you know, it's good, it's good to be in a position where we can kind of do the right thing socially and we'll be fine. Yeah. There is definitely a bifurcation happening amongst the people who are, uh, keyboard jockeys, people whose work manifest itself mostly in front of a keyboard, which I think all three of us fall into and everybody, almost everybody in our industry falls into. where work is still occurring and it almost feels like work is occurring more.

I'm working at least 20, 30% more than I ever have. Are you having that experience as well, Alice? Are you working the same or more now? Oh, more. Definitely more. I used to have these really beautiful breaks in my day when I would not have a couple of pressing tasks and I could sit and think and go,

what's a story that I looked right? Who should I talk to? What have I not gotten to? What's falling behind? Instead now, I'm just frantically like some sort of dumb dog chasing a truck trying to keep up. And I'm drowning a little bit. I'm not getting into all the things that I want to do.

I haven't looked deeply enough, for example, into Airbnb's new debt rounds. You know, I should have already dug into that. I'm behind. So as a journalist, there's just so much work because there's so much news. Yes. And the fan base, the readers are demanding more news. And they're... Yeah.

Or are they are. But I wouldn't call the readers. fans per se. I don't think of them that way. I think of them the people that I'm here to serve, as opposed to people who are here to like, you know, fawn on me. But I think the privilege point is really important. Like, to be clear, I'm losing my mind, but I'm doing it from a position of safety. I have plenty of food and toilet paper. All the guns are in Oregon, but I'm safe enough anyways. I want to point out that I do recognize that, even though I am slowly going bonkers. A little bit bonkers. Yes. Yeah. I mean, the work point is an interesting one. I think

there's kind of two vectors. One is like, what's your job? And I agree. I mean, the reality is, is work has been very intense. You know, the company we're building is it's super relevant. For the fun we're running, you know, I do some writing as well. Like, things are very, very intense in terms of the amount of things to do. That's obviously a privilege that we can work from home and make that all happen compared to a lot of people who can't. The other is kids.

The other big thing I've noticed, and I've talked to a lot of friends about this, is, you know, it is difficult to work at home with your kids, especially young ones all the time. because they need help and attention and teaching, depending on the phase they're in. So I have to admit that sometimes, and maybe my kids will hear this someday and be mad, but sometimes my fantasy is, man, like, I didn't have kids right now.

I'd be getting, like, an unbelievable amount done. And as it is, I feel like, I feel like, again, like we're still able to work and making a lot of progress. I'm not sure my operating company, Finn, will ever go fully back to the office because it's been extremely productive for everyone to be home. It kind of was an interesting moment to prove that point. But the kid's thing is difficult.

The kid vector is super challenging and also delightful. I feel more connected to my kids than ever. I'm wondering about with my 10-year-old what long-term impact this is going to have of generation like Q quarantine. Like if this did go on for six months or 12 months, it's going to be a very memorable thing. If it goes on for 60 days, it'll be memorable. But if it goes on for six, 12 months, I'm not sure what the impact on, you know, kids, the age of six or seven and teenagers are going to be like not going back to work, not being able to see their friends, not going to graduation, not playing soccer,

whatever it is they did or being in their band or not going to camp. I mean, your kids are a little bit young on the younger side, Sam, so they're not in school yet. But I wonder about that. They are. They have Zoom. You know, our older son has, you know, his Zoom class a few times a week. and they're trying to do Zoom soccer. I mean, it's getting a little weird, but...

Zoom soccer. Yeah, we didn't actually attend that, but there was an optional Zoom soccer session where apparently there was soccer instruction over Zoom. Didn't do that one. But people are trying, people are experimenting. I'm impressed. I've impressed by that. I've heard a lot about kids that are struggling

to kind of convert into this new school. And a lot of my colleagues at TC have children. They're balancing that. So I'm kind of watching this in real time. And my siblings all have kids. I never thought I'd say it, but I'm very blessed to not how. have children for the first time. Like I, I almost felt behind on having kids, but now I feel

downright lucky. I do think that'll be a really interesting question about what happens to the birth rate in this period and kind of the, it's going to be kind of like an opposite of a baby boom, at least, right, where I feel like a lot of people are going to say, like, this is not a great time to have a kid, right? At least for a year or two, and we'll see how that plays out and then see what happens from there. Oh, wow. I think of that. That's, I think a really profound point, Sam, like a person saying, do I want a child to be born into this if this is going to be an ongoing chaos? And do I want to have a pregnancy during this? If this is a 12, 18 month, God forbid, 24-month process to a cure. I mean, we have three guys on the program today, but I mean,

if there was, imagine being a woman and being pregnant during this and not being able to go to the doctor and then having to die. We have many friends who are in this position right now. And it's a really challenging thing. And it thinks about how you think about that's going to play out of it. I also think you can't recount the fact that, like, look, the economic, macroeconomic impact of this is really scary, right? And so even if for us, like, again, we're all very fortunate and lucky and I think we have to recognize that every time, like, that's not going to be a predominant factor.

Like, that's going to impact birth rates, right? It's going to impact your little thing about family planning for years to come. So it's really hard to start thinking through, to even start, like, understand the magnitude of the impact this is going to have on family planning and all sorts of things in the coming years. It's really interesting. I was in, when I was in Japan on book tour, like, I don't know, maybe a year and a half ago, I had two different executives.

I said, oh, do you have family of kids? And they said, no, no kids. And they kind of shook their head in that, like, kind of Japanese, like, ah, you know, kind of way. And where they're really, like, guttural, like, a deep, like, there's something deeper at work. And I said, why? I know kids. I'm just curious. And I said, I just don't think it's moral to bring a child into this world, you know, with the death and destruction and the environment and global warming.

They didn't bring up pandemics, but they were specifically attuned to global warming. There's this big, like, existential feeling of what is the point of bringing kids into a world that's not a good world? That's a declining world. And that is really heartbreaking when I heard that in Japan. I have friends in the U.S. who feel that way. I don't agree with them. And I think it's easy to get overly pessimistic about the world. I think even pandemic, and this is a terrible time to be kind of thinking.

This is like, world's doing pretty well from my perspective in a historical perspective. But yeah, I think there's definitely going to be an impact for the next 10 years. This generation is going to be scarred. And then there's, I'm really interested in the bifurcation. of the class of people who are gainfully employed, the class of people who want to be employed, but cannot find a job, and then the group of people who capitulate and maybe say, I'm not going to even try to find a job. I'm going to pick a different lifestyle because this is all just too frustrating when we get back for this quick break. Here in California, Gavin Newsom

is outlined a six-point plan to restart California's economy, and that is becoming the discussion and now that, even New York, which is God, the epicenter of this, and our hearts go out to the folks there. And we'll talk about that in just a minute after we get back from this quick break. We've got a lot going on here at Launch My Investment Company. You know we have the podcast

and we do the launch accelerator. Over 100 companies have gone for that. We do all over our events like the Angel Summit and launch festival Sydney and scale, just tons and tons of stuff to keep organized. And our company has become addicted to a product you may have heard insiders talking about. It's called Notion, N-O-T-I-O-N, Notion.

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And it's almost like a little dashboard for me to see the top level of what they're working on. And here is our associate press showing us his to-do list tracking system that he built on notion. You can see it's customized by how he likes to get track of what he's working on. And as some of you know, I get my team to write what's called an EOD. Here, this to-do list is just easy way of keeping track of things. He's templated it. So each week, Prush can just click a button and have the layout ready to go. And on top of that, Notion is so customizable that we're able to work exactly the way we want to.

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Again, notion.com slash twist. I am just delighted that they are supporting the podcast because we're using the product all day long. And when they said they wanted to reach this audience, our audience, you, the founders out there building great companies, I was like, it's going to be the easiest ad read for me because I am addicted to using the product. Let me know what you see behind the slash key, right? Forward slash.

You know what I'm talking about if you use Notion. Let me know what your favorite is. Okay, let's get back to this amazing episode. All right, my guest today, Sam Lesson. He's L-E-S-S-I-N. He's the co-founder of Finn. We'll find out a little bit more about that in a bit, and he is a partner at Slow Ventures.

Alex Wilhelm is here. He is Alex on the Twitter. Senior Editor TechCrunch was the Editor at Crunch base, and he's been coming on the pod on the regular, which I really appreciate as I try to get people to carve out an hour, hour and a half of their day to talk to us about this very trying and confounding time. And people are starting to think about going back.

But Alex, how are you feeling about you're married and you said earlier that you guys were planning on having kids? How do you look at that given what Sam and I were just discussing of this moral question? Yeah, I'm thinking full speed ahead in a couple months. I mean, we haven't been trying so far. We've been busy. My wife is a, she's a doctor. And so she's a medical resident right now. So we have a pretty busy life.

But we talked about it before we got married. It's the plan. We're going to proceed with it. We're actually, you know, knock on wood, everyone, you know, who asks us, we'll kind of laugh. We're hoping to have, you know, three, maybe four over the next of the next while. I'm one of four myself. And I'm very lucky to be from a happy family. And I really love them.

And so I think we're going to take a crack at it. You know, I think a lot about what Sam said and about what people are saying about, not bringing people into this world and, you know, the concerns about it. But, like, you know, you can also do a lot of good if you raise smart, conscientious children who go out there and make things better. So I'm hoping to take on the responsibility well of raising children who make the world a better place. And if you do that, I think the concerns that the story you told Jason, they fall away a little bit. But it'll be harder to protect kids probably in, you know, 50 years and it was 50 years ago. So we'll balance it.

It's an ongoing debate because of the media and because of this incredible, machine, social media, Facebook, Twitter. That just brings you whatever the most exciting, funniest, tragic,

overwhelming, exciting piece of media, meme, module, whatever. You can really, if you go down that rabbit hole, think the world is horrible,

but all the statistics and all the charts, with the exception of one, are going in the right direction. And the only one that's not going the right direction, sadly, ticked down from 54% of people living in a democracy down to, I think, 51% now.

And that's the one that's super troubling because I think a lot of the good things in the world start with democracy. Pretty sure of that. And we're going to be teetering on that one. I's definitely one to keep an eye on. But getting back to the imminent news, and I think this is, it's great in a way that we're having this discussion now because it means that we have been able to shape the curve. we have been able to impact the coronavirus's impact on us.

We've been able to counter it. Obviously, by social distancing and staying at home, we've seen virtually no deaths in San Francisco. It's like, I think, one in the last two weeks. Very few in the peninsula, you know, a decent number in Southern California. But if you stay home, it does not transfer. And if it doesn't transfer, people don't die. And we're getting better at dealing with people who are,

infected when we're learning how to treat them. Maybe intubation is not the best thing to do. Maybe just rolling people over on their stomach is, which is really interesting. But New York's death total is staggering. And it really does remind me of 9-11, where I was in New York at 9-11. And when I talked to people outside of New York,

it just had a different worldview of it. I think that's one of the thing that's happening, too, is in the northeast is a different worldview. 16,000 people dead in New York. But total cases in California is 27. So the total caseload in California, is in the ballpark of New York's total deaths. The plan, according to Newsom, developing widespread testing ability,

being able to care for the most at-risk populations, the elderly, the homeless, let's face it, obese people are becoming a serious vector. Capacity for hospitals to deal with the surgeon patients, seems like we got that under control. Identification of promising treatments. development of guidelines for businesses and schools to allow physical distancing even as they reopen, a fascinating, interesting one to think about.

And the creation of, and I think this is something where Sam, you're going to have a lot to say, a data tracking system that provides an early warning if the states needs to reinstate a stay-at-home order, what I think people most commonly refer to track and trace. Sam, when you look at those six bullet points, I think the last one is the one you're most qualified to talk about. you did work at the Facebook, Facebook and Google, Apple, everybody is getting involved in this track and trace, which on one side is a privacy nightmare on the side is completely essential and could be the silver bullet. What do you think of track and trace? That's a whole hour-long conversation. I mean, you know, look, at Facebook, you know, as a VP product there, I ran identity

and privacy for many years. And I spent a lot of time looking at these kinds of problems, thinking about them. I think, you know, what you've seen so far with both Apple and Google releasing APIs, but not applications, is kind of the challenge, which is everyone recognizes the power of the data and the value of it. And everyone is terrified of building the experiences and taking on that responsibility, you know, in terms of what that actually ends up looking like and how it plays out. It's just, I don't think it's a winnable situation for any tech company, right? Because the reality is no matter what you do, millions, hundreds of millions, hundreds of millions, people, people are going to be very angry, right? And it's really hard when you're not a government

to make calls like that. You know, maybe the reality is that it will be done on a state basis or a national basis and the governments will make decisions about what to do and not do and how these systems run. But man, I mean, this is a great example of technology being incredibly powerful. And, you know, the history of new technology and new ways of tracking information, changing social dynamics, having huge privacy ramifications, but also huge value, is hundreds of years old. Like, this isn't an internet story. This is Bismarck, right? Like, you know, this is like, this goes way back. And I don't, I don't really know what to do. I mean, there's a question of how to make it work. There's some, like, what do you actually do with it?

Like, can you actually make a system that's accurate enough and blah, blah, blah. I think the answer to that is generally probably yes, although there are some questions outstanding there. And there's a question of, like, for somebody who's a lay person, and if you were designing it, what's the basic blocking and tackling of how you would explain it to your cousin,

brother, sister, sibling, mother-father, of like, hey, here's what we're doing with your data if you were building it for any company, you know,

just pick a new company. What would you, how would you explain? The most basic level is, your Bluetooth is on, your GPS is on. I know every other Bluetooth device you came near.

I know every place you were, right? That's all reasonably doable. There's still questions about that, but let's pretend that's all doable. We drop it all on a huge database. If anyone comes up and says they've been in contact, then you have some semblance of who they run into in the real world, and you notify them and say, hey, you need to get tested if we can do that,

or you need to stay home, we're in quarantine, or whatever the net outcome on it is. This is terrifying. Like, if you said that you wanted this, a year ago, people had proposed this for any reason, for a crime, for health, whatever, everyone would have lost their mind, right? But people have, I mean, and like, the reality is, is there's a good argument that you should lose your mind about this. And there's a really interesting question of who controls the data,

who are you going to use it for? We can get into a thousand really hard problems. You know, the reality is when the alternative is death or staying at home at a destructure of the economy, people are pretty quickly willing to trade privacy, and they probably should be, right, for things we need, right? privacy is like it's a luxury to be able to value that in a lot of ways. I am terrified.

I mean, terrifies the wrong word. There's like the pragmatic version, which is like, yeah, we probably need to do this stuff. There's the challenging history, which is it's extremely hard to undo any of this stuff once you've done it. And people have been proposing, oh, we'll do it for a while and then we'll turn it off. That's not going to happen. Like, history says that never happens, right? This only goes in one direction. It didn't work out too well for the Republic and the prequels when Palpatine decided he was going to take emergency.

powers, Alex, when you hear this description of the product, is there a way, and if you were the product designer, Alex, and you got to be, let's say, the abudsman of the Facebook Google project, and I anointed you as chairman of the internet. Well, just to point out, this is not, right now, it's an Apple Google product. Facebook is not doing. Facebook isn't involved yet, yeah. Apple Google. So, Alex, if I put you in charge of the Google, Apple, mobile phone consortium, and you,

the abudsman had to answer to the public and answer to private. privacy concerns, how would you frame it, number one, to explain to people, and then how would you architect it to protect against these issues? Well, if I was in charge of this from those two companies and I was the ombudsman of the internet, I would just pause and I would fly private around the world once, just if I could have done that, and then I would get to work. I'm really sick of flying commercial. I think what you have to have is someone who is the public face of it, who isn't me, someone who actually has the public's trust, someone who is someone that can take questions well,

unlike our current president, for example, and answer a lot of concerns. Because what we're going to have in this situation is what kind of standpointing out. There are a lot of fear that this won't go away, that it will be misused, and that we're building another step in a kind of government-slash-corporate-sponsored surveillance network. I mean, we're all seeing the news out of China about how their system is being used, occasionally for good, often for ill. Yeah. And we can see the tradeoffs, at least in one example of this live.

So we need someone who could do good job. Alex Damos, who's now at Zoom actually might be a good guy. He was formerly at Facebook, I think. Kind of a respected source and speaker on privacy things in the tradeoffs. Someone like that. And then you'd have to, you know, hopefully set a sunsetting date. Tell people, look, you know, by January, 2023, whatever the date is, we're 99.9% sure we'll have a handle on this with the vaccine and test and trace.

and all this, we'll shut it down and we'll publish learnings and we'll torch the records and all that. If that was the set of things that were put in place, I would be okay with it. But short of that, I'm not. So number one, having it a budsman, which I just came up with us on the spot, a third party who administered this would be a really good idea, putting a Pricewaterhouse Ernst & Young to audit how the architecture was made, another good idea. We have those kind of things for things like casinos or, you know, if you wanted to make a poker game

online, you do have to have it audited by somebody who looks at the actual source code and audits it and checks it. But then having really a rolling burn policy for the data would be really interesting because you could actually say it's going to be required for any city that has over this percentage of cases, right? So it's required if you have over this many cases, it's often otherwise. So under a thousand people in the hospital, you know, you don't have to use it. But when you get above a thousand in whatever community that is, you have to turn it on.

And the police might stop you to check that you have it, just like they might check your mask. But what is the reasonable amount of time you even need this data? If you ran it to somebody a year ago that had it, that's useless. Mood. So call 60 days, right? Sure. I just think the question is how do you actually guarantee any of that? I mean, there's only two ways to guarantee things.

You can guarantee them with policy or you can guarantee them with technology. Again, on the policy side, any policy set is subject to change. You can have someone like Estemos, who I like, say some stuff, but he doesn't control any of this. You need to trust the entity, right? And that's a big trust to leap. We probably have to do it, to be clear, but it's a risk. The other is you can technologically guarantee things, right? And that's actually, I think, in theory the better answer, right?

Explain that to a layperson. Well, I think technology guarantee is like, look, you know, when you use the internet, you have a pretty good technological guarantee that your internet traffic is secure, right? Like, it's encrypted, it's designed that way. It's extremely hard to impossible for anyone to intercept. That's guaranteed. What's not guaranteed is the data at rest where it's stored, right? How it's remembered.

What's not guaranteed is your identity. These are the things that the internet is incomplete on. I mean, I'm a huge believer long-term that things like crypto should be part of the solution, right? Because that is how you get cryptographically guaranteed memory with properties that cannot be broken and things like that. But basically, in the end of the day, it's like, look, unfortunately, the internet and technology isn't quite developed enough that we can actually encode at a deep level, at a technical level,

rules like this. We have to rely on rules set by a political body. by organizations. And look, I don't think we're in a place where we have a lot of trust in those. I still think we probably have to do it all. But like, it is an interesting challenge. You know, if this, I wrote a thing in the information, which, you know, is a publication. My wife runs.

I wrote kind of an opinion piece saying, what would this, what would COVID have been like if it happened 30 years in the future? I think we have a whole different set of tools and a whole different set of ways to do, you know, tracing type work in a more secure way that we can trust. but we just don't have those tools right now. Yeah. All right, when we get back to this quick break, I want to talk about getting back to work.

And under what circumstances, you think technology companies who have invested heavily in campuses and open floor plans will be impacted by this in the short and the long term. And if we are actually going to have a permanent change

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their feed. I'm kidding. Are you, Alex, you're very effervescent. Are you, do you get it? How much time you spent on the Twitter lesson? Are you allowed to, like, use the Twitter? Is that like, as a Facebook alum, are you kind of like... No, I'm all over Twitter. You're all over it. I mean, I'm not like you. I don't, you know, but I post my viewpoints on the Twitter.

When you were at Facebook, did you use Twitter? I had used it a bunch before I was at Facebook. I definitely used it a lot less when I was at Facebook. That's mostly because, honestly, at Facebook, the internal discussions are so fascinating. and once you have Facebook, internal Facebook is amazing. And so it just was more interesting. You have your own like,

Facebook posting to other, just to the people who work at Facebook. Oh, the corporate Facebook feed. Yeah, I mean, it's become workplace now. But when I was there, it was just like a different setting on Facebook.

And like, that's just really interesting. So, wow. But now that I have access to that, you know, Twitter's pretty good. Yeah.

How did you guys look at Twitter when you were at work? Like, did you guys think like, that's like some crazy existential threat or it's just this like really interesting little side thing like a bubble that we can never recreate. No, no, no. I mean, remember, I left working on Facebook in 2014.

So it's in quite some time. But, you know, we're super into Twitter. Twitter is super interesting. And this question of how do you have public global conversation is obviously something that's become a major part of what Facebook is as well. And, you know, it's very relevant. Why doesn't Facebook have that in the way that Twitter, does. I'm just curious.

I mean, that's another, you're asking, you're asking multi-hour questions in a one-hour problem. Okay, well, give you to me in two sentence, like, then. Like, no, why does it? There's something to do with your architecture? There's very different graphs, right, in terms of who you're connected to

between real friends and, you know, Twitter, personalities slash, you know, expressions of self. And I think it's extremely hard to layer multiple graphs into one product, in like, that are different and distinct into one space and one brand. You know, what I think you've seen is things like Instagram is that public follow

model and like a very good and different conversation shaped by the content types that obviously is, you know, owned by Facebook and part of the ecosystem. So I think it's been an evolution. But Twitter is a very cool product. Is interesting. Twitter is. You think Alex, that's kind of what it is. If you're going to have like a mix it up discussion about politics or whatever, you just don't want to do that with your aunts and uncles and that graph and your college roommates. You want to do that with like, the people in your, you know, in that vertical. Yeah, yeah, yeah, I think about this a little bit because I've been on Twitter too much for too long,

about 12 years now, I think. And I've, I cleared all my tweets once. I killed off like 180,000. And I've got tens of thousands more because I just can't shut up. I deleted my first 90,000 too. I was just like, why did you delete your first? 90,000? You guys have tweets so much. I archived. Oh, believable. And I asked Jack, like, Jack, can I just turn off all my old tweets? And it's like, yeah, that doesn't exist as a feature. I was like, well, I'm deleting them. so it's kind of sad in a way like I'm deleting this whole

Wait how do you know how many tweets you've sent Well there's a service called tweet deleter or something Where you could say delete any tweet older than this amount Yeah Oh I see And I've tweeted 3,000 7 I've been in Twitter since March of 2007 And I've tweeted 3,700 times

I've never deleted anything So I guess I'm not into Twitter You tweet once every other day If you're journalists We're creating 15, 25 times a day Yeah Yeah yeah yeah But the graph is different

Alex Oh, because I went through college and I was on Twitter. I didn't want to have like, what if I was drunk one night? It's a dumb thing on Twitter and someone found it and my life got ended. It just didn't seem like a reasonable risk. I had to be in mind because people kept pulling them up and they're like, you said this about Islamic terrorism. I'm like, yeah, I just don't want to have another conversation about how I feel about Islamic terrorism. You know, like am I not supposed to use the word Islamic terrorism?

Yeah, but I don't use Twitter because I don't want to not use Facebook. I use Twitter because all the most interesting people in the world are there. Right. And that is a feature that you can't replicate, that you can't spin up. It's not exactly even bits, bytes, and code. It's just who's on Twitter and who spends their time there and a lot of time and who's accessible. Like, I have access to people on Twitter that I don't because they won't answer the phone, but they're around.

And so I can kind of plug into them and learn and also communicate and share. And also, Twitter is still a place you can be a little bit weird. It hasn't turned into LinkedIn yet. It's still a bit loose and fun and not serious. And to me, the hybrid of interesting people, people and the ability to have fun and the ability to be myself is a thing that's coming there for 12 years. I've been on since 2008, so a little bit after Sam. But, you know, I see myself been around for 12 more years to the sugar. I was the partner. I was just thinking about this

other day. When it first started, I was on it when it was an SMS service. And the number one, two and three user at one point, I got to find the screenshot of it was Robert Schobel, me, and then this guy Barack Obama who was running for president and was like the 10th candidate and I remember it very specifically Scobel had 40,000 followers and there were like 60,000 followers

there were 60,000 people on Twitter. Wow. And what Scobo was doing was he would follow everybody and if somebody followed you on Twitter in the beginning you were kind of expected to follow them back as a courtesy. And then I had 20,000 and Obama had like 15,000. And then, yeah, that changed very quickly. quick.

Yeah, I was going to say. Change pretty quick. When we left for break, I wanted to understand how you think business is going to change going forward. And Sam, you kind of tipped your cards on this a little bit saying, you know, we were in person and we thought there was some sort of debate going on. And now we've kind of been forced to be remote. What are you seeing?

What was that debate inside of Finn? Explain what Finn is. Explain what the debate was. And then now where you've wound up in that debate, 30 days into quarantine. Yeah. So, I mean, look, I mean, Finn, we build software is quite relevant right now, which is we basically drop an agent and help large operations teams, customer service, back office, whatever, build very large data sets of exactly what their teams are doing.

Every scroll, every click, you know, on every single case that are working, plus video and audio, mix it all together and then help people basically figure out how to work more efficiently, right, and drive, you know, better performance through the teams, whether that's, you know, certain things people don't know how to do, understand what best practice is and kind of applying it across the team. Like, we basically help people manage things. And it works really well for remote teams, right? And so it's been candidly, like, very good for our business because people are like, oh my God, we're now remote. We need help with this immediately. Fend's a great answer. But fundamentally what we are is nine software people, right? And, you know, we have an office. We go into it.

We're used to working that way. People work from home occasionally. Now we're all forced to work from home. The reality is, is like, I actually think productivity has gone up. People seem pretty happy at work. Like, I do think there's that missing, like, how do we hang out a little bit or like kind of the lunches? We got to figure out how to fix those and replace those. But, you know, I was talking to my co-founder, Andrew Cortina last night. Cortina is the founder of Venmo, the application, you know, the payment app. And we were saying, I don't think we're ever going to go fully back to the office. Like, this is working really well from a productivity standpoint for our team. You know, we're tiny. I'm sure there are a bunch of tiny startups that will look like

that. We'll see what the big companies decide to do. My bet is, is that they're actually probably experiencing relatively something similar. I don't think office culture is going 100% away. But I definitely think that this was kind of a forcing, everyone was kind of, it was almost like curious about remote work. This forced everyone to try it. And I think people are going to come out of that and be like, wow, this actually works pretty well. Like, let's go for it, right? Yeah. Alex, you were work from home curious I saw on your Tinder profile. U.W.S.H. curious. Back in the day, the TechCrunch headquarters used to be like a crazy, like place to go visit. It was kind of an epicenter. Now, is it all virtual now? And how long have you been virtual?

And do you think this is going to be a permanent reset? What do you think a Google campus, a Facebook campus, an Apple campus with that giant three or four, five, seven billion dollar spaceship? What do you think those campuses are going to look like post this? Yeah, yeah. It's a set of good questions. And I've been thinking a lot about this because I've had a lot of time alone because I've been in my little home office. I had to cancel a trip to the SF. And, you know, I've been even more remote than I usually am. It's a majority remote person. So I've been tinkering with this. So on the TC side, we have an office. We're by the Chronicle. It's a lovely space. It's an old Yahoo space. There's free food. And it's perfectly lovely. But one thing that I saw my last job at Crunch Base was that a lot of startups still have an office focused culture. And that they may have. have a couple of remote employees, but they tend to have kind of an office focus. I think that's what's going to break. I think startups are going to be much more willing to hire people around the country and around the world because they've just now been forced to live and execute in a manner that allows for remote work. I think that'll open things up and hopefully make the talent market a bit more equal across the country. Maybe lower some of those salary differentials, get people a shot in Pittsburgh

that didn't have a chance before. On the big tech company campus point, one of my favorite days in the Bay Area that I ever had was my first day going to Yahoo's campus back in the day. And it was in the Marissa Mayer era. And so there was tons of people around and free food. It was lovely. It was just warm. And it was one of those sunny veiled days that you just kind of like, oh, this is California. And I bring it up because there were so many people there was like bring your kid to

work day. It was just packed. That doesn't seem to be like the future to me. That seems like the past. It felt like a family picnic when you go to these campuses. People will be on these sprawling campuses out on the grass and parked tables. Yeah. It's lovely. So you may not have as much of that, which means the big loser in this is going to be

commercial real estate. And I was talking to my friends about this and I was like, wait a second, what is the point of having $90, $110, like the space you're talking about where Yahoo is, that space, I'm going to guess that space, $90 a square foot, maybe $60, $70 a square foot when they It can't be cheap. Yeah. So. You know, there's a lot of money.

money when you start thinking about it, you know, hundreds of thousands, millions of dollars a year in space. What's the point of having all that if you only use half of it? And then they start thinking about commute times. There are people living in San Francisco paying $4,000 a month for an apartment, $4,500 a month for an apartment for a two-bad room, whatever, and then taking a bus to Facebook for an hour a day or Google or wherever. And you're like, what are you doing? What are you doing? I mean, that is the worst way to live life. You spend all your time on the 101 and you get the least department for the most money. I mean, I was once 23 as well. I like to go partying, but like it's a short era of your life. You know, it doesn't last. What I think this is going to

cause is this could be the rebirth of San Francisco we've been waiting for, which is all of this extra office space then converts into housing. Sure. A bunch of people realize I could live in, you know, on the east side of Lake Tahoe and not pay state tax and be remote and come to San Francisco go once in a while. We already see our entrepreneurs fleeing to Sacramento, St. Louis Obispo, Healdsburg, you know, Napa, whatever, people just leaving outside the city. And even our company, for the first time, we had an investment professional, just part-time, we just said a thing like, hey, work 80 hours a month, meet 100 companies a month, whatever it is, and just, you know, or one an hour, basically, and just write coverage and send us those companies

after you do your Zoom. And that actually worked really well. And I was like, it was a trusted person, so it worked, but I was like, wow, we could actually do this remote. And I thought in person was, you know, you had to do it as an investor. And now I'm making seven investments for our accelerator. I haven't met the founders in person. And this is really, I mean, it's a 100K bet. So it's not like a $3 million round. But I'm talking to some venture capital friends in a secret Slack group I set up for seed and venture funds. And in that secret group, I said, anybody making, what do people think about making investments about meeting people in person. They're like, no way.

Yeah. How long do you think it would have taken you to get to this point if we didn't have COVID-19 and this forced and stay-at-home work? I wouldn't have done it because I gave a big speech in my company, you know, months ago. I said, listen, anybody who wants us to be a work from home company, you can quit now because I had like two people pressuring me. Like, they were literally trying to lead a revolt inside the company to not have people come to the office and unlimited vacation, all this other nonsense.

and I was like, yeah, it's not going to happen. I'm basing this company on Sequoia and what I saw that. When I used to go to Sequoia, for a board meeting, I would see Michael Moritz, Doug Leone, you know, this young Rulof Botha,

young Alfred Lynn, all walking around the place. They were all there every day. Yeah. Jim Gatz, they were there every day. Every day I saw all of them having lunch together with founders.

And I was like, that's the culture I want. I want everybody when they come to that office to see everybody. And now, I'm just like, I don't know if I can,

sustain that. I think it's an ideal. I think it's something to shoot for. You can say, I want to have an office friendly culture. I want to have people show up when they can, but you don't have to say, you have to be in the office or you can't work here.

So I think what we've done is we've just constricted ourselves and left a lot of talent on the waist side that was actually probably pretty good. And I think that's going to change. I think people will hire a bit more abroad. And I have seen my friends in their late 20s, 30s, and 40s, slowly drift out of the Bay Area. And I was kind of the last one out.

to some degree. And a lot of them work remote for Bay Area companies, and it's fine. But again, they work at more the tip of the spear. But now I just think that the change has come. And companies that don't become more flexible about remote work will be to competitive disadvantage in the future. Because companies that are that will hire around the country, with world, can be faster, a bigger talent pool to pull from, maybe even some cost savings. I mean, it's going to be a way forward. But I do not think offices are done. I've seen some takes on Twitter and some blogs. And I'm like, eh, you know. But certainly I think that the peak has passed, One thing I've seen, Sam, is that some people, even on my own team, were like, I need to come to the office every day. I don't like being at home alone. I like getting up in the morning. I like my, you know, commute, you know, to an extent. And I like the ritual being in an office and seeing everybody and the socialization. Where do you, what is the other side? What do we lose by being 100% virtual? And what do you think the arguments will be for people still coming to offices?

look, I think the kids thing. It's the kids thing. Like in the end of the day, like if you, yes, if you have an apartment that's set up for home and works at home and you're that in that zone and you do type of soft work that's extremely remote friendly like software engineering with GitHub and Asana and everything's connected and it's like it works great. You know, if you're trying to do super high bandwidth, I mean, investment is a good thing. Like I'm not, you know, we do a lot of investing at slow ventures. You know, we do a lot of investing in slow ventures. You know, we have pretty large early stage fund. And like, it's fine for now.

But to your point, it's like when you're making bigger bets, you know, millions of dollars, et cetera, it's like you want to meet the people in person. You want to go to have those unstructured times talking to the people you invest with, et cetera. You know, basically I think here's another way to think about it, which is there's really two types of work in my mind that are in front of a computer. There's creative work, right? And then there's, we'll call it like task space.

There's like knowledge work or creative work. creative work and then there's just kind of like more road task-based work. And there's this tension where, you know, things get more efficient when you can take knowledge work and make it task-based, right? Like the more you can take an unstructured task and structure it and package it in a way that you can do it asynchronously and remote and da-da-da-da-da. There's a lot of efficiency in that. But obviously also there's this big tension,

which is anything that's remote, this road, you want to use human tension and labor well. And so you basically want to kind of automate all the most basic parts of that and turn it more into knowledge. knowledge or creative work, right? And so there's kind of tension between types of work we all do. We all do kind of a mixture of both.

I think doing the kind of road stuff at home or remote is going to be fine. I think doing that highly intensive creative work at home is not. But it's going to be a tension about how that kind of evolves and what work fits into what different types of spaces. Let me ask you this way, Sam. Would Facebook been able to hit the notes it hit, the heights it hit, the speed, the velocity, the product excellence, and execution, had it been a remote company? So I think Facebook would have been very hard to build originally as a remote culture.

Actually, when I joined Facebook, I was running a startup in New York called Drop. That I know that Facebook acquired. And I had a big conversation with the team there about whether I should move to Menlo Park or not. And because I wanted to stay in New York. I love New York. And the culture was like, look, you can do that. You're just going to miss all the most important conversations. And it's kind of not worth it.

Like, if you want to be in it, you got to be in it. we've got to be in person. 100% true of the culture at the time. Now, if you look at Facebook then versus Facebook now, Facebook's a huge company now, is a lot of the work that's done at Facebook, easy to package properly, task properly,

make something you can do remote, for sure. But like the high octane conversation, Zoom's really good. I think Zoom really does make things a lot better. Video conferencing is kind of finally almost arrived. But you're still going to want to be in person. You're still going to want to have that lunch that's unstructured.

I mean, I think there's a lot of work. They're really intensely creative work, the really, you know, interesting, nuanced decisions. You want a space to do that live, I think, personally. But again, remember, most work is not that. Most work is pretty rude.

It does seem to me that a company like we work, if it were to actually make it out of the other side of this, would be perfectly designed for this new world, where companies are going to need on-demand space, maybe blow up and, you know, expand work dynamically like an AWS server, any kind of cloud computing. Alex, what opportunities do you see in this new world for startups and other opportunities for services as we move to this more remote world?

Do you see some silver linings or opportunities for founders coming up? Yeah, it's interesting. I was just thinking about WeWork when we were talking about this because if you needed to get out of your house for eight hours for a couple of days to do maybe one deep project, you would want to have a space you could go to and rent and kind of hot desk, I think, is the old term. There's space near where I live in Rhode Island that I would if I didn't have a separate office space where I live. But I think one thing we haven't done well is properly equip people to work it from home effectively. I think everyone kind of took their laptop home and is sitting on their couch going, hey, this isn't very good.

Well, no shit. Of course it's not very good. Are you shocked that that didn't work when you converted your own? office into literally nothing. So I think there needs to be a lot more investment. So I think the startups that are going to do best here are the ones that are giving out reasonable amounts of money to employees to buy better microphones, better lighting, better cameras like Sam has, you know, and wired internet connections like Jason, you've been talking about on Twitter so much, and really give everyone a chance to have a functional good work setup and get them a door and a better

chair and the things they kind of had before at home. But you can't just go home and have it work. And the second thing I'll throw in there is we're all struggling a little bit right now with work from home because this isn't really work from home. This is shelter in place during a pandemic while trying to work. And there's a distinction there. I've been a remote worker, at least part-time for a long time, and you build up certain habits to maintain sanity. Like, I spent extra money to go to my favorite coffee spot down the street just because it makes me put on pants in the morning and I go talk to some humans and I have to be normal. It's good for me. I can't do that now. You might even throw in a shower. You might even throw in a shower. Oh, I shower all the time. So that's not an issue for me.

But like in the morning now, I just like I say head of my dogs. I pat them on the head. And I go to my office, right? It's not the same level of interaction. So even for me, a remote worker veteran, for lack of a better term, I'm struggling a bit too. So I think people are also getting the wrong impression of what this is. I, I think, a few things I'll throw in. One is, in terms of the flex space idea, I mean, look, maybe it's we work, you know, we invest a long time a call called breather, which is actually, I think, even more perfectly designed for this. Breeder is basically exactly those. It's just by the hour on-demand conference spaces that are scattered all over the place and easy to spit up. So I think there are models like that

that will make more sense. You know, you're not going to want to rent monthly, right? It's like more like hourly, right, and more on demand than what, than what we've seen in office space. In terms of work for home, I think this is the argument, like, you know, we've invested in, I've seen a lot of companies that are relevant to their work at home space. And there's a double-edged sword everyone's noting. The good news is that the future just got pulled forward by 10 years, right?

Just like 10 years of work from home experience and people experienced, it's starting to dabble with it, just got happened in like a month. And that's super good for the companies, people are trying to, enable it, things like that. The more sober view on the flip side, though, you know, to Alex your point is people say, look, the bad news is this is not the first experience we wanted people to have. Like, we wanted people to experience this differently. And so, and like, kind of come to it differently. And so there's a bunch of bad habits or bad experiences that really are not ideal for this transition to work remotely or work wherever you want. That again, you know,

is a real cost to the ecosystem. So it's, you know, you know, luckily a lot of the infrastructure stayed up. God bless AWS, right? Like, it's amazing that this stuff works that needed to work

and flex up really quickly. But it is an interesting kind of moment in time for that whole narrative. That is an interesting thing. If you think about, you know, there's probably people who never tried an Instacart or good eggs

or a DoorDash. And obviously, they downloaded those apps. and I was getting emails and people in New York were trying Mercado, which is a delivery service for like mom and pop, like food stores in New York, which are kind of a staple there. And so all of these services now have all these people who've installed them. And then you go on and you try to buy a microphone or a green screen or a webcam or any of that stuff on Amazon. It's all sold out. The essential.

A green screen. Oh, my God. How can you live? You can't work from home without a green screen. And then you got these people who are like stockpiling. lavaliers for their own use, like, you're never going to get to the third lavalier, Sam. You can't just

stockpile lavaliers. You're stockpiling AV equipment like people are stockpiling toilet paper. It makes sense in this context. Go ahead. Yeah, look, I think that I think you're hitting all the right notes in terms of what happens. I mean, like, again, it's a challenging thing.

I think that, you know, my experience, I'll tell you of mine like this is I've had many generations of Oculus headsets and I always buy them and play with a little bit. I'm like, I don't like this and then kind of move on. I finally played multiplayer Oculus, uh, game last weekend because we're all stuck at home. It was so fun. Which game? What was the game? Yeah. It's called Arizona Sunshine. Have you seen this? No, but now I really want to buy it. I'm a gamer. So this is, uh, this is a, it's great. It's basically this game where you

work with like three other friends and you're in the zone and like a bunch of zombies come at you and you shoot them. And like, I haven't played video games multiplayer like that. especially first person shooter since like high school. And it's like in terms of like the idea that this is opening new space for us to try things we wouldn't have otherwise tried and some of those things will stick. That's for sure true. Can I ask you an inside question here, Sam? Was one of the people on this zombie game?

Is there a last name capital Z? Does it start with a capital? I'm not going to answer. Okay, okay. I'll leave it at that. I'll leave it at that. I know the company that owns Oculus. You made work there before.

I've been playing. This is the game I've been playing, and it's getting quite costly. There's an app called Poker R-R-2, and all the poker groups I was a member of in L.A. and some other ones are now playing online poker in private clubs with Zoom on. And so I've been on my treadmill playing cards, and I'm playing PLO, and I'm sort of playing short-deck poker, and everybody's playing their poker games virtual. What do we think about the stock market? This is one of the interesting things that I'm...

can't understand. Stock market crashed. It looked like it was going to be the end of days. And then it rebounds. All these stimulus checks go out. We're going to pump billions of dollars. And now it's seeming Amazon is at an all-time high. And, you know, is this to have any relation to reality, Alex? And has anybody been able to give you a cogent, coherent, logical assessment of what's happening in the stock market, given that the economy and the unemployment has gone supernova? No, but I want to make a distinction. I think you raised a good point there about Amazon. It's perfectly reasonable that Amazon's doing very well in the situation.

It's not reasonable to me that the rest of the stock market is. There's going to be winners. We all know that Zoom and Slack are doing fantastically well right now and good on them for keeping online like Sam mentioned and kind of staying afloat when we all need them. But the economic damage that we're seeing, especially Thursday morning with another 5.2 million unemployment plans in one week, I don't think it's been reflected correctly by the stock market. And the reason why I've been thinking about this a lot is I talk to VCs essentially every single day as part of my job just talking to people about what they're seeing, what they're doing, what they care about.

And everyone's freaking out politely. You know, they're worried about churn for their B2B SaaS companies. They're worried about demand at all for their B2C companies. They're talking about, you know, much slower growth, layoffs, much harder funding climates. Just everything is going worse at once. and then I turn it over to the stock market and it's up, you know, two points. This is the disconnect I can't really square and I can't figure out. And people who are pro, or I don't have a phrase is like, who are in the business of being in favor of private equities going up.

Point to the Fed and point two stimulus checks and all this. But to me, these are, these are band-aids on an open wound. I don't think that we are properly pricing in the amount of the demand shock that's going to come from having all-time high unemployment in this nation, which is where we're going like two or three more weeks of our current level of job loss. So I'm worried and it's interesting to listen to the private investors more than the public investors on this. Because usually the VCs are the optimistic ones and the private market, public market guys are the pessimists. It's inverted, which is just a surreal moan as a journalist. But I can't.

Where's the money? Where are you going to put the money? Like the thing that I think I understand everything you're saying, I agree with it. I am also confused by some of those stuff. But I think my only counter argument is like, where are you going to put it? Like, you put it in dollars while we're printing tons of them? What are you going to put it in? Right?

So my view is actually kind of like, look, when you think about where the stock market is relative to other alternatives of where you would put money, right? Like, it's just not very clear. And so the reality is I'd rather own a productive asset, right, than I would almost anything else. You know, I mean, I'm very crypto-focused. So like, I'm a huge believer that this is a Bitcoin moment, right? for sure that we're witnessing and like I think there are some pieces there

but you know you're not going to put the entire value of the world into Bitcoin right? This is a Bitcoin moment all the Bitcoiners all the cryptos were like oh yeah when the world goes to pot then you'll see

and crypto Bitcoin's gone nowhere so isn't it supposed to be that Bitcoin's supposed to spike now wait a minute first of all Bitcoin isn't going to nowhere Bitcoin is flat well the rest of the world is down 20% So Bitcoin is up 20%. Okay. There's one way to look at it.

Okay. I mean, that's, I think, the way to look at it. And we'll see what happens. Again, I do think that, like, there's a real story here. I just, again, everyone says, why is the market not down more? I'm like, what you want cash right now? Like, is that what you want? Why?

If I was a company. Why do you want cash? Like, if you're an individual. Oh, an individual. Oh, sorry. No. No, of course you want cash as an individual. But if you don't want cash as an individual, you don't want an index fund.

You don't want, like, what do you want? Because the only way the market goes down is that things are the pump people a little bit of money into. Yeah. I mean, to be clear, I mean, like all my money is in index funds and I'm still buying them. So, like, I'm doing the exact same thing going to be for because I have a very long horizon. But it's been my impression that stock markets are a bit more panicky than what you're describing. You're making a relatively logical argument. And I wonder if-

What do you think about the private markets then, Sam? And what are you seeing at Slow Ventures? Are you guys going to keep the same pace? circle the wagons and help your portfolio companies or go faster? Well, the answer is we're doing a lot of deals. They're very different deals than they were even a few weeks ago. They're lower prices. They're more conservative.

They're more realistic than we are. And I'll tell you why, because I've been thinking a lot about this. The thing that's scary in the private markets is I don't know who's buying the next round. Right. Like the way venture works, right, is I sit there and you do you too at a very, early stage. We say, look, we can invest in this with these terms because we know that if you hit these metrics, which we think you can hit, there's a market for your equity for your securities at 3x the price, right? And I'm willing to make that back. I don't know that there is a 3x

the price anymore, right? Because you can kind of back this up in terms of how you get the pipeline to public and back off that through private market investors. It's just unclear what things are worth anymore. And so we'll still do lots of deals, but like, and we're still excited about a lot of companies, but it's really hard to know how to price things. And so people are being very conservative because I'm worried that, you know, you'll hit all your metrics. You'll do a great job. The company will be in great shape. And the next round of investors will say, hmm, we don't like it at this price. You know, they're worried about the fact that there's not going to be, you know, there are going to be no venture funds raised in the next 12 months. It's not going to happen because

effectively every major LP is going to rebalance their portfolios, right? Everyone's already over exposed venture because venture has been going up a lot and the public markets have. So now it's only more dire. And so it's just going to be an interesting trickle through. I think the people who really get heard in this personally, well, we'll see. The most challenging thing is going to be being an early stage investor, I think. Of course I think that because I am one. But basically, because the thing you have to be careful about is you're no longer betting on, does this company work?

You're betting on does this company work and is their financing for it? And is the financing going to be structured in a way that I don't lose my shares? Because what's likely going to happen is a ton of recaps, a lot of pay to play. there's going to be a lot of things going on with later stage investors, which are totally rational, but are going to mean that it's very hard to maintain ownership from an early stage position through to any liquidity events. So basically, yeah, we're going to put our money in and the idea that there's going to be a $30 million series A after this 12 or $15 million seed round seems farcical now. So seeds got to move back down to where it was when I did Uber, Thumbtack, data stacks. all those companies were $4 or $5 million when I did the seed rounds.

Now I've got people who want $15 million seed rounds and they're no Travis. They're no Marco for sure. But even if they are and even if you do hit the thumbtack, the question is, what did the next round get priced at? And when is priced, do you have dry powder to keep playing? Because what's going to likely happen is that all the early stage investors for a while

will just get wiped out right by later stage investors. It's a brutal world out there. And the way that works is the later stage investors say, hey, we're going to recap the company. We know you were a $15 million seed round and you did a $25 million note. We're bringing you back down to 12. And we're going to recap the company. And we want a 2x, 3x liquidation preference, which I haven't seen yet. Have you seen any predatory terms or have you talked to any venture capitalized that?

I haven't seen multiples on liquidation preference yet. I've seen basically everything else. And like I think this whole thing about predatory terms, it's like, is, I don't know. I think we have to be careful about the language we use on this stuff. Like people have LPs. They're trying to make them money. And like the reality is like I don't, I mean, liquidation preference is a particularly nasty one.

I agree with you on that. But there are a lot of other terms that are just like pretty reasonable given where we are and given the fact that like all of a sudden people are very nervous about making sure they can make their LPs and the people that are responsible to returns. So you don't perceive. You don't perceive investors are doing this because they can. because they're the only funding source or the only person willing to write a check,

but they legitimately think the world's reset valuations. I mean, that's my view and what I see. I mean, I generally don't. Most of the investors I feel like I interact with are good people. But, you know, I mean, there are predators out there to try not to talk to them. But like, the, you know, the reality is good companies are going to keep getting built.

There are good entrepreneurs and can keep building good stuff, right? There's still good capital out there. It just needs to be reset a little bit. but because until we understand what a series A looks like in 2021 and what a series B looks like from there and what access to the late stage capital looks like, you just have to be really cautious because there's so many ways to lose your shirt, right, through the whole private ecosystem. Alex, what do you think?

What have you seen? You talk to a lot of folks in the space. What are people thinking at the seed stage? What are these people, the fearful VCs and seed funds, they're cautious, they're scared. they, what are they telling you? So I talk to people a little bit later than that. I don't talk to a whole bunch of seed people because I tend to think about the startup world from a financial perspective. And a lot of seed stage companies don't have a lot of revenue to kind of think about. So kind of one one step later, it seems that the old expectations of what a company might need

to have to receive a next series of funding or to achieve a certain valuation increase have gone up. And it's happening at the same time in which people are expecting performance to go down. People are expecting more churn, lower ACVs, you know, just all this stuff you don't want to see. Average customer value. All these metrics are getting... Yeah. Works because the economy's falling apart. So while the bar is going up, expected performance that you're going to see from startups is going down. So the combination of that is a kind of a double ratchet on, on proximate evaluations and ability to fundraise. I would view this slightly less charitably than Sam. I think that some VCs will take advantage of this because they can, because they do.

have money. And I don't think it's only because the market has your price because they are the market. They could just decide theoretically as a group. But I think we're still in this weird kind of roadrunner coyote moment when coyotes run over the cliff and there's no ground beneath him and he's still spinning his legs before he drops. That's how the economy feels to me right now. We've seen 22 million unemployment claims in like four weeks. No one knows what that means. We haven't done this before. There's no track record. I 100% agree with that. I look at those job losses.

And I think if we go back to work, let's even say in June, and this is a two or three month unemployment situation, half the restaurants come back, whatever, half the retail locations come back, that number gets half. The other half are on some permanent unemployment, dole, UBI, whatever we want to call it frame it as, but we take, I saw that we up the maximum in California for unemployment, and let's just say we put people on 18, 24, even 36 months of unemployment benefits, and people have already gotten their stimulus checks. We can easily weather that as a society. And then we have, in the game I'm looking at, in the framework I'm building in my mind,

the mental model I see, is a group of people who are getting, paid somewhere between 50 and 80%, maybe even 100% of what they were getting after taxes, to stay home. And then that group breaks into two. One group wants to work. One group says, you know what, this is enough to live off of in a more modest lifestyle. Maybe I opt out of working, which we've had before, where we had less people participating in the workforce. So you have this less people participating in the workforce. At the same time, you have these other, whatever companies do survive become stronger, right?

So whoever becomes, whoever survives is the the ramen shop in San Mateo that makes it out alive and the other five go or the four that make it and the four that go, the other four will be stronger.

It seems to me like we're going to be able to weather the storm really well. And then I just wonder about that bifurcation of those three worlds, people who are unemployed, but not looking for work, people are unemployed,

and can get work and then eventually do get work and then the class of keyboard jockeys. What do you think, Alex, of my sort of mental model? So I think there's a lot of merit to it. I know we're a bit short on time, so I'll compress what I'm thinking. But one thing that really blew my mind when we were putting together this increased federal support for workers who were laid off was that people didn't want to have the government subsidy be worth more than their wages.

And the reason why we were running into that problem was that even providing a subsistence amount of money from the federal government was worth more than their paycheck because we've let the minimum wage stagnate for so long because we as a country hate working people and don't view them as human. So one thing we could do to avoid the situation that you're describing you which, you know, why work is make the value of labor higher. And we could transfer some profits from corporations to workers. I know this sounds dramatic, but I mean, I really mean this honestly. We've let the minimum wage stagnated for so long. We've devalued the lowest paid tier of labor to effectively less than substance earning. It makes sense when you think about it.

And it's disgusting. If the federal minimum wage is like seven or eight bucks and we're sending people stimulus checks or UBI, then we're basically incenting people like why would you for the incremental 10 or 20 or 30 percent commute, right? And what's the point of actually getting out of bed or leaving your house when you can be home with your kids and enjoying life or pursuing some small business, right? Eventually it ends, right? Even if it's 12 months, 24 months or 36 months like you said, there is an end to this. And I think that we have allowed our society to become so broken in how we treat certain classes of workers and people that we're now befuddled about how to restructure it even a little bit to make it a bit more reasonable and fair and equitable. It seems like the city's got this right by going to $15 an hour minimum wage and increasing it slowly over time. So as not to have people go to automation, like if you're increasing it $1 a year, which is what I think San Francisco, New York and Washington did, they just added $1 a year to the minimum wage.

got to $14 or $15 an hour now, and they didn't see too many cashiers turned into kiosks, but the rest of the country still at seven. And then you look at other high-functioning societies like Australia. I think it's $18 an hour minimum wage now. They're kind of really working on that becoming sustainable and livable. Sam, what's your mental model for employment post-crisis? And Alex, if you've got to jump off, I understand. I'll jump off in like two.

Okay. I also have to jump on it too. But, well, a few thoughts. One is to keep in mind is, look, you guys, we just spent all this time talking about remote work and more remote work. More remote work is going to mean lower wages, right, in cities and in pocket. This is that simple. It's like, look, I can source all labor globally, right? And, you know, we're talking about, you know, $7, $15 wages more, right?

The reality is there's a ton of people in the world who will work for three, right? And there are a lot of really talented people in the world that work for three or five, right? And so this is really, I mean, this is not new, but there's this like globalization, technology that enables globalization versus locally pocketed high wage support questions that are just very difficult. And like the real question is not, you know, UBI for the U.S. It's like, how do we think that this is a global ecosystem and how do we think about the relationship being globalization and a lot of these jobs? Now, service work, right, in cities, which has to be done locally, which can't be tell it, you know, done remotely does have some special protective properties, which allows it to be

higher paid in theory. And we can talk about that and the kind of the implications of that. Look, I mean, I agree generally that, like, there's a lot that's going to have to change out of this crisis. And like, I think people are recognized this, but like what that looks like in terms of, you know, medical support and who's, who's providing medical aid, which I think, you know, clearly shown as a little bit broken in our system, you know, what minimum wage? What kind of, what do we give out of the country to help? help people have enough of a safety net to go pursue their dreams or whatever and how that interlikes with wages. These things are all extremely complicated. I don't think there's any

quick solve. We can't afford UBI indefinitely as a country. It's just not a, it's not a thing yet. It's a nice idea. I think it's certainly with experimenting with and researching, but like the impact of it is unclear. I generally believe that, I mean, if you're asking for political beliefs, it's like, look, I believe there's a world in which if you really believe in capitalism, which I do, in competition, which I do, that having the government support medical and some basic income components will actually make the world more competitive, more people more creative than online yards, not less. Why?

Because people agree with you, but I just want to hear your logic. Well, it's great. It's right now the question, the biggest inequity in the world is who can afford to take a risk and who can't, right? Again, I heard an article about it that I love to share with your listeners, but like, you know, the reason that like the rich get richer is because the rich can afford to take risk. And as the world gets more discontinuous, the ability to afford risk is actually the biggest driver in wealth inequality.

The problem with being, you know, with the working class and a lot of what we see is like, they just have no option. They can't afford risk because if they lose their job, they lose their health, they lose the ability to support their very basic lifestyles and things like that. So I think if you allow more people into the game or more people can take risks and compete, 100% correct. You'll get more capitalism. This is why any capitalist wants to, any real rabid capitalist and entrepreneur wants to see healthcare become universal in America. Yes.

So that people are not staying in jobs they hate and people can leave and take risk and not worry about going to the doctor. We'd have many more entrepreneurs. We would add tens of millions of people to the entrepreneurial class if they didn't have to worry about going to the doctor. Yeah, this is the thing I think it needs to you reframe. I think we all agree on this is like, look, fundamentally what this crisis should hopefully show us and we'll hopefully see a path for.

If you want real freedom and competition, if you really believe in free markets and capitalism, you need to provide more services. Like these are not like some socialist thing. This is actually like the underpinning that allows for more capitalism. It's the road. way. If you think of it like, you know, the railroads or the roads, the infrastructure, public education, just public being, you know, healthcare services are just like those roads that allowed commerce to occur. On that note, we'll wrap. Alex, thanks for coming on the pod. Everybody go to TechCrunch and read his words. Everybody go to the information and read Sam's. If you're not subscribing to the information, I think you have a monthly option now, too, and it's really affordable. It's maybe 25 bucks a month or something now. 39 of the base, but there's some promotions you could probably find.

Probably find some promotions. Use the code lesson, L-E-S-S-I-N, to get 25% off for this weekend startup's listeners. Maybe that works. Maybe it doesn't. That doesn't work. Three months free. Use the code lesson. Use the code J-Cal.

Get a year free. Who knows if that works or not? Alex. You're welcome to try. Lesson is lesson. Thanks again, boys. Stay safe. Love to the families.

And to all of those frontline workers in the hospital. in New York and every other place infected around the world. The janitors, the cleaning people, the nurses, the doctors, the security guards, the front line, Lyft, Uber, Postmates, drivers, cloud kitchen workers. Thank you. Thank you for putting yourself in harm's way to keep us fed, to keep us healthy, keep us safe. We're going to get through this. We're going to get through it together.

We're going to come out the other side stronger. Thanks again, Alex. Thanks again, Sam. Thank you. See, guys. All right. Be safe. We'll see you next time on this week in Sternups.