This Week in Startups - E1079: The Power of Accelerators E10 Daniel Gross, Founder of Pioneer on gamifying the startup process, importance of mentorship in tech & more!

Episode Date: June 24, 2020

Follow Daniel: https://twitter.com/danielgross Check out Pioneer: https://pioneer.app/ Follow Jason: https://twitter.com/Jason https://linktr.ee/calacanis

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You'll also get access to an exclusive community of startups for advice and connections. Visit Zendesk.com slash twist today to get started. Hey, everybody, hey everybody. It's your boy, Jason Kalakhanis, here on this week in startups. And we are continuing. In fact, we're wrapping up our Power of Accelerator series. And this was intended as a 10-part series since many of the founders who are watching and aspiring founders want to know, hey, should I consider an incubator, should I consider an accelerator? And what's the state of those?

Because I get this all the time. Which accelerator should I pick? Should I go to Techstar? Should you go to launch accelerator? Should you go to Y Combinator? What's this dream it thing? What's S-O-S-V? and we did our study of all the different accelerators out there.

We wanted to have a range from internal ones like Ford's X program, obviously having TechStars, which is the largest one in the world, science, the startup studio model. We went through all these crazy different models. And to be totally honest, all of them you probably already knew about. They all fit the exact mold. But I always look for things that are. innovative. And we're ending with what I think is the most innovative new idea I've seen in

accelerators in a long time. And it's called Pioneer. And the founder is Daniel Gross. And I believe he was that Y Combinator for a bit. And when I saw this, I said, wow, this is amazing. Everybody in Silicon Valley, everybody in the investment space, even in the accelerator space, because there's so many companies, has moved a bit downstream. So you look at VCs. They used to invest in a business plan, then they invested in a prototype or a mock up, then they invested in MVP, then they invested in pay trials. And now they're saying, hey, wait until you got a million to $3 million in revenue. Then a VC will do it.

Seed funds, Angels, accelerators, incubators would do that early stuff. And then even the accelerators, because they had so many people applying, they started to move downstream. In fact, the launch accelerator, we changed the name from an incubator. We went to an accelerator because, my God, the first two years of trying to just get your product launched, we have so many companies to choose from. we just wait till you get to 5K in revenue and maybe 1,000 people using your product today for a consumer product, and that's what we like to engage.

And then I see this pioneer accelerator, and it starts with a forum and says, hey, what do you want to build? And it's literally starting from day zero. Daniel, thanks for coming on the pod. I'm incredibly impressed with what you've built, and I'm monitoring it daily because you share the videos on YouTube. And it's a little bit

like it feels a little acoustic right now still feels like you're figuring it out. But it's impressive in what I think is year two for you. Where are you at with this project? And tell me what you, how you describe it to the world. Sure thing. Yeah. Thanks for having me on.

I've been a fan of your work and of your content for quite some time. I'm excited to participate in and give back and hopefully be even 10% as amusing as your regular guests are. So Pioneer is, yeah, you know, it's funny. A lot of people talk about themselves as a startup accelerator. We're almost really hoping to be a startup generator. We're looking to find people, you know, at the point where they're working on an interesting

project and they're not even really sure if it's a company or they're working on maybe a very, you know, they just incorporated, but they're not really sure they have product market fit. And we're aiming to bring these people what I think is the largest kind of scarcity in the startup ecosystem pipeline is a sense of validation and confirmation that, yes, they should be working on what they're working on. They should be going down the rabbit hole they're exploring. And they should be taking their dream and their passion a little bit, you know, more seriously. My view is twofold.

One, I think like weirdness and change and variety. is a great thing for the world. And I think we want to live in the world that has many more small startups instead of four or five large tech companies. And I think we want that. We want more variety. We want more choice. We want more creativity. Lots of small islands instead of a few continents. And secondly, I think the largest constriction towards creating more of these startups is effectively generating more of these extraordinarily productive people that go on to form these companies. And I think the largest constriction there is there's a lot of people and there's a lot of companies that never make it past the GitHub repo phase. You know, I think GitHub is the largest graveyard of startups, period, because, you know, someone kind of gets started and they're not really sure if they should take the idea any further.

And, you know, unlike a structured job where there's a very clear motivational treadmill and there's almost a very obvious game to play, you know, in terms of how to advance, what's good, what's bad. you know, if you work at Starbucks or in the military or even just a manager in a large company, it's really clear what to do next. In startups, especially in the early days before you have revenue, super unclear what to do next, right? And so motivation comes and fits and starts and maybe you're excited and inspired and you get started and then it dies. So Pioneer takes literally the shape of an online game to try to inject some of that motivational structure into people that are kind of at the project building says to try and get them

to take that thing a little bit more further. So it's a website you go to. It's pretty simple. Unlike traditional accelerators, we try to run as much in software as possible so that we can service as many people as possible. And you can go to the website and you can check it out. You can even check out the internals without registering. Literally, it takes the place of a structured game with points.

And the more progress you make on your project, the more points you get. And if you get a bunch of points, you become a pioneer. And that kind of gives you funding, active network, friendship, and so forth. But the real vision is to really generate another thousand companies that would not exist without kind of this web, you know, product and platform. Yeah, and I thought this was really fascinating. When you go to the, I think it's pioneer dot app. And it's a fully remote accelerator, which we've had to move to and Ycombinator and TechStars was experimented with one. So you got that right as well because that reduces a ton of friction, anybody can participate. but the game, when you click that you want to enter the game,

it's really fascinating, and I'm pulling it up here for people, but it tells you exactly what to do and gives you your progress bar. And if you go back to that page, you just sign up, tell us about your project, submit your weekly update, and it tells you how many points you get 50. Then it says vote on weekly progress updates. That's up to 50 points, and that's Monday at 1am and Tuesday at 1 a.m. And then you have quests.

You're actually using that term quests, finish your project description, upload a one minute video, take a 40 minute series of puzzles, add your project's metrics. And this is fascinating because all of this activity results in a climb the leaderboard and see the top 50. And I don't know if this is correct or not, but when you do the mentorship sessions where you have Austin and I see had Des Trainer, my friend from Intercom, you had Austin from Lambda School, which were investors in, they will, I think the reward, correct me if I'm wrong, for doing work and going up the leaderboard is you get a famous founder to then hear your pitch and give you feedback and you publish that to your YouTube channel, correct? Yes.

That's right. And the idea is if you do well, you try on the leaderboard in time, you become a pioneer, you get a chance to meet some of these interesting folks, some of these founders. That in itself, I think, is both useful and the tactical advice you get, but also more importantly, kind of just inspirational. I mean, I'm sure you have this experience where, you know, before you were an insider, you were very much an outsider looking in. And to be able to talk to someone from the inside was life changing, life changing, right?

It is the moment in time where you can demark, like, I met Mark, I remember meeting Mark Cuban. I remember meeting Michael Moritz from Sequoia. Like, you remember meeting these absolutely famous people. and they may have given you just a little bit of attention. And it just filled your bucket. It fills your gas tank for a year. That's right. And, and, you know, I think, I feel like a lot of founders don't realize this.

Because no one really wants to say that what they need is a bit of inspiration. It's kind of a bit too Tony Robbins. But the reality of it is, I think the general service that the founder or the advisor or the investor is giving the founder, if they're really doing their job in office hours, it is not the tactical advice. It is that like you can go and get it type of inspiration. I remember I would have these moments where I came out to Silicon Valley as pretty much a nobody from Jerusalem, Israel. When I was 18 years old, I went through YC.

And a lot of what I got out of interact. You know, back then YC was Paul Graham, Jessica, and I don't know, half a dozen or a dozen companies. What I got out of it was very much walking in feeling like. like, I mean, I don't know how to tie my shoe laces and walking out feeling like my company is going to go public the next day. And I think that's incredibly important because here's the subtle thing going on. It is the insecure overachievers that make for the best founders and change the world. These people are their own harshest critic. And so they got that voice inside their head saying, you're an imposter. Are you really, are you really going to get this done?

It's impossible. But then all of a sudden, you're in the white. office, you're like, I made it. I'm here. And you're totally correct. And that feedback loop kicks in also once you have customers and revenue. That's real validation that you're not just a loser. But the issue is everything starts at zero. And so you have to, you know, we think of venture capital as a mechanic to inject money into companies before they have much traction. But there's a little bit of kind of social capital where you have to inject a bit of inspiration into someone just to get them off the ground. Yeah, absolutely. When we get back from this quick break, I want to look at the leaderboard, and then I want to ask you about a couple of companies and how it's going so far,

and what is the deal for founders? How much equity do you take? How much money to give them when we get back on this week in store. Now more than ever, we need people with the right skills to support our communities, especially the frontline workers who provide the resources and care for those most in need. You all know this. We see it, and we are in awe of those frontline workers, obviously. And so to help My friends at LinkedIn are offering free job posts to healthcare and essential service organizations that need to quickly fill critical roles with the people who help us all. How awesome is that? If you or someone you know are hiring for one of these organizations, LinkedIn's active community of over 675 million members can help you quickly find the perfect candidate.

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visit LinkedIn.com slash power. That's right, LinkedIn.com slash power. and you can post a healthcare or essential job for free. Thanks again to LinkedIn for supporting the powers of Accelerator series. I learned a ton and I know the hundreds of thousands of people who tune into every episode got a lot out of it. We're really hoping that you guys start companies. And thanks to LinkedIn, which was a startup not too long ago.

They may have 675 million members now, but they started with 675. So keep that in mind, founders out there, you can do it. Okay, let's get back to this amazing program. All right, this is episode 10 in our series, The Power of Accelerators. You know, we had Steve from Dream Adventures on. We had Stardex, Cameron from Stanford's amazing program, Mass Challenge, SOSVC, Capital Factory, my pal Josh from Austin, David, my boy from Techstar is not that David, the other David, the other David's, two Davids.

We had Alchemist on. We had Mike Jones from Science. We had my pal Sunny from FordX. And Daniel, who I think I'm going to become fast friends with from Pioneer. dot app because he's really doing something that, you know, you don't see many people just starting with a really new concept. And I actually have never seen anybody even try this concept. And it seems to be working because I actually, I'm in touch with two of your founders, which I'm reticent to say it here because they might come to our accelerate. I might put

$100 grand into them. So I don't want to publicly say which ones, but I'll tell you offline or slide into your DMs. What is the deal for founders? anybody can sign up. I know that. It's free to sign up. When you sign up, do you get 1% or 10% of the company just for them being in the program? Do you get an option to invest? What's your business model here? Totally. Yeah. So it's very simple. We've worked to try to make it as structured and as simple as possible. I think one of the challenges with, certainly as a founder that I faced with the venture industry in my first company was just negotiating. opaque deals with VCs always felt, well, I always felt like I was at the losing end of the stick because here's a guy that does it all day versus you that is doing it for the first time.

Of course. Anyway, so we try to make things very transparent and simple. So the way it works is this. It's totally free to register and to kind of use the software. It's quite fun, actually. Even if you don't become a pioneer, we actually get tons of letters and emails from people who thank us for the system despite them not winning just because of the amount of feedback you get from other players in the community. You know, as it turns out, you know, we thought we were making Pioneer for Pioneer.

It turns out the community of non-winners itself is quite interesting. All that's free. If you become a pioneer, yeah, in exchange for the mentorship, the community and the feedback, you effectively subscribe 1% of your company to Pioneer. And for the most part, if you don't have, a lot of our winners don't even have, you know, companies at that point will help you form it for free and take care of all of that beautiful Delaware paperwork for you. And then we have three structured tiers alongside, which will occasionally invest, what we call Pioneer Gold, which is a $20,000 investment, platinum, which is $100,000

investment, and $1 million, which is a million dollar investment. And those are totally optional add-ons, if you will, for later on. We do find a lot of our pioneers occasionally take that 1% offer and then end up raising a lot of more money just by. virtue of kind of status exchange alone. Many of them end up going to what. That they went through Pioneer. That they went through Pioneer. We have this live stream that we do, which is kind of our equivalent of demo day,

but it's on Twitch and YouTube and it's streamed live and people kind of demo their work. And a lot of investors watch it live. Yeah. I mean, I'm one. I've watched it a couple times and I actually set an alert on Twitter for when you're doing it. And I subscribe to your channel. I get an alert. So once in a while, I'm probably catch one out of five live or one out of ten.

But what I like about it is just I learn something as somebody who's been in the industry for three decades. I learned something when I hear Des Trainor giving his opinion. Maybe not Austin, but, you know, like, I'm joking, Austin. But, yeah, you learn something watching this nice dialogue about the questions people ask about the businesses. How does one get to the top of the leaderboard exactly? And can you pull up the leaderboard, Nick, so we can look at it? Oh, and then what percentage do people get for those, for the gold, platinum, et cetera? Is that a fixed amount or is it on a note? How does that actually mechanically, work. I'm curious. Gold and platinum are fixed at 5%. And you just make a decision if you think they

have enough to be gold or platinum in your mind. Yes, of course, it would be quite beautiful if we could at some point mechanize and software when to hand out those offers, right? That is, of course, the dream. And I would like to work towards that one day. But just like, you know, occasionally you have humans driving cars before you have autonomous cars. We need to educate ourselves in the system a little bit about what to look for, you know, before offering those. And that's a dangerous incentive to put into a video game because then people will be hacking the game, not actually focus on customer delight, right?

This is the truth of any leaderboard system. The good news is you've unlocked tremendous kinetic energy in people to try to perform while on that leaderboard. The bad news is they will work to perform for the leaderboard. And this isn't just pioneer. You see this on Twitter. You see this in sales leaderboards. Yeah.

People say incendiary things on social networks to get more likes, right? It's part of the polarization in society that's occurred is if you say something that's straight down the middle and accurate, you get no clicks. But if you pick a side and your MSNBC or Fox, you get all the clicks because you pick the side. Yes. Yes. Yes. I, I, the, we have, you know, we have interesting moments for us where you can kind of,

our job in many ways as designers of a game is fairly similar to the job and an economist. We have a currency and we're trying to figure out, you know, which. of these quests are worth what and exactly how much to make it worth it. And we spend a bunch of time thinking about that, but it always surprises me how seriously people take that stuff. Because at the end of the day, you know, kind of we're crafting this. But then I kind of realized maybe this is what the Fed is thinking too. Because at the end of the day, these are all numbers and, you know, people will work to maximize, you know, whatever metrics you give them. Yeah. So if we pull up the leaderboard here for a second, how I see Hacker Stash from the Netherlands,

has 24,000. Thirdweb.co has 24,144. I guess that seems like the top amount of points you can get, basically. Tell us about, you know, and then somebody worked, somebody won. I might have been remote hour. Is that it? What was the one? I think it was a Japanese founder who did an office hours type product where you could just set up office hours and people would just dump into like your Zoom. and you just set a time and people would just come in and talk to you. I forgot the name of it. I believe you're thinking of remote hour. That's Shun, right? Yeah.

And I got in touch with that founder because there's a really clever idea. And he's in San Francisco and he's a solo founder. It's really interesting. How do people get to the top of the leaderboard? What would those 24,000 points? What would be the driver to get there? And then what happens if you hit the top 10? Yeah.

So, I mean, it's fairly similar to a game in the sense that there are many questions. can go on and all of them kind of add up to different number of points. Predominally, the large driver of your score is the community and the expert rating on your feedback, on your progress. Sorry. So every single week, you're submitting a progress update to the system, to the whole network of other players about kind of what you did that week. And then, interestingly, you get points for voting on other people's progress reports. So it's quite interesting. And we have a very interesting mechanic on the inside where this isn't kind of like your standard voting UI. You get shown two progress updates from two different players. So one can be from Schoen, who's building remote hour,

and he'll tell you a little bit about, you know, he managed to get, you know, 20, 30 users this week. The other person will say, well, I got only one person, but they're paying me maybe a little bit more money. And then the users asked, which is more impressive at number A, sorry, position A or position B. And here's something interesting. Here's something interesting. So they pick, say, A over B. We ask them then to give, obviously, positive feedback to A. Why did you think this progress was more impressive? But then constructive feedback to the person they thought was less impressive. And we were very scared before we launched this feature because, as you know, it's the internet. Who's nice to strangers on the internet? That doesn't happen.

No. But, but this turned out to be one of like our big product learnings maybe of 2019 was the feature does incredibly well and people take the time to write incredibly detailed constructive feedback on why this wasn't as interesting as the other one. And it beckons this interesting psychological question, which is what is going on? Why are people nice to each other here? And I think the simple answer is because we're not really well known. See, my view is part of the problem that the internet has, today is that the eternal September effect has kicked in on steroids. There's a ton of people on the internet and most people are pretty normal. They're not outsiders. And most normal people over time kind of devolve into the crazy activity we see on Twitter. It used to be the case that strangers work very nice to each other on the internet. You know, back when it was IRC, you know, in 1998, or use Ned or PHBBB. And what we've managed to do in Pioneer, one of the reasons why I think it special isn't just the kind of nice software on yellow colors is we've carved out a little bit a space online that's a little bit dislodged from everything else. And we're in this interesting

position where we get a lot of free positive selection pressure for it. You know, we're not going to get the series, you know, A founder from Stanford or whatever. We shouldn't. We're not a great place for them and our deals don't make economic sense for them. But we will get to take, you know, the first real bet on someone. You know, we have a, a pioneer named Arsalon. It's building a company called LiveDox. It's basically the new quip. You know, it's a Google Docs competitor. He, you know, came to us from the UAE, literally. And he would have moments where it was a real blessing of Zoom. The guy would be calling in and he'd be in Kashmir suddenly and there'd be no like heating. And so he'd have 10 blankets on. Now he's in

San Francisco and raised around from General Catalyst for his startup. All because kind of Pioneer took a bet on him. Yeah, and another founder by the name of Shepo from South Africa, building a search engine for software code. I saw that one, actually, yeah. It went through now as a YC founder. And so we got a lot of free selection from folks that wouldn't make sense for any other place. And I think a lot of it is working for that reason. The interesting twist for us is, I think as Pioneer becomes more successful, selection will get harder. Because I think, we're actually going to start attracting more and more normal people. Ah, right.

And so there's this interesting flywheel effect. You know, if you read a lot about the early days of Harvard, it was actually fairly similar. If you think about it, just as a concept for a moment, 19th century, are you really going to go to this new continent no one's been to and go study there? No. No, it seems super weird. So you get a lot of frontiersmen. Exactly. Go to Oxford.

So you get a lot of frontiersmen. And frontiersmen are always the ones to create nonlinear change. in our world. And so, you know, at that point, the community goes kind of from frontier to famous. And when it's famous, a lot of normal people want to do it. And normal people are great. Normal people run our banks, you know, make our taxes run on time, run our military. But they don't create this type of nonlinear change that, you know, Einstein and Romanooga are famous for. Those are always outsiders. And if you're not careful, you end up bringing a lot of kind of normal people into your network. And I think long term, that's the thing we'll have to think.

about. But for now, you know, it seems to be working. We funded, gosh, about 140 folks around the world in about 40 different countries. 140 in how many months? In... Or years? Two years? Yeah, the ramp is interesting. The ramp is probably a year and a half because it took us a while to get our act together. That's a large number of startups. When we get back from this quick break, I want to know what your expectation is for returns and how you have constructed your portfolio construction for how you will make this, you know, a money returning enterprise when we get back on this week's service. If you don't have your SOC2 compliance buttoned up, well, you're not going to be able to close major customers. It's really that simple. You know this. And if you already have your SOC2 report,

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Okay, let's get back to this amazing episode. All right, welcome back to this week in startups. We decided to do this Power of Accelerator series because, gosh, I get too many questions about what accelerator should I go to and which ones are good and I'm pretty famous for saying most of them are terrible. Well, here's one today that is terribly innovative

and is really filling a niche that nobody else really seems to want to do the hard work. It's hard to do the early stuff because, yeah, it's not polished. There's nothing there. It's literally you're starting with a blank sheet of paper. And most investors don't like to do this because you've added probably a year to two years

to your investment being realized by being this early. Whereas Y Combinator, maybe there are two years beyond you. A seed fund might be a year or two beyond that. And a Series A fund might be five years behind that. In other words, a Series A or Series B fund could get returns in, five to seven years, you're going to be more in the 10 to 15 range. I'm sure you realize that you have a longer window. Is this like a proper fund where you have a $50 million or a $10 million fund?

Are you funding this yourself? How does the economics work for you as a company or as an investment fund? What is Pioneer itself as a corporate entity? Yeah. Pioneer is, I mean, it is a small corporate entity. We don't have your kind of traditional fancy fund structure. And maybe that will change for us over time. But for now, you know, we're pretty modest. We raised a small amount of money from, you know, myself, Stripe, the company and Mark Andreessen individually, just because they were kind of all fans of the work and the concept. You know, we started Pioneer because very much believe it's an important experiment to run in the world. Look like any experiments and like any startups, statistical odds are against us. But gosh, if we could make a thing that kind of

generates more interesting founders and more interesting people that wouldn't exist otherwise. And you know, we'd go from an era where every single year I feel like there's like two to five great breakout companies. But if we could go from that era to like an era where there's 10 or 50 and be responsible for that, that'd be awesome. It'd be pretty great legacy. I tell you that. Yeah. And I think it'd be a lot of fun, right? Just be just be. Because, you know, one of the reasons I got into startup investing kind of organically, even before Pioneer, is it's a lot of fun. You meet interesting people working on interesting problems. And that is the best part.

You have to hang out the smartest, most driven people who want to make the world better. What a selection criteria for your to have a fun circle of people to hang out with. It's complete neurogenesis on that sense. And so, yeah, so Pioneer is kind of a, how would you say, it's a kind of operationalization of that insight. And instead of doing it in a fairly ad hoc fashion with a bunch of emails, we try to write software to do it. But that's really the main goal is to try to create change. You know, a lot of us who work at Pioneer are effectively outsiders that became insiders. You know, we're all immigrants either to the United States or to California.

and we're eager to find a mechanized way to pay it forward to others, just like a person or institution did us. Yeah, how many people work there? It's small. I can count it on my hands. We're about five people. Perfect. And you raised a seed round or something or a series A? How much have you raised?

I don't think we've ever fully published numbers, but we raised a bunch of money. A bunch? Oh, okay. Like a fund, or does the investment occur from the course? corporate entity and then it's just like Evergreen. We have a small, humble LLC. Got it. And right now it's evergreen.

And, you know, I, it's interesting. You know, it's, I should probably ask you your advice for this off camera, but we're in this funny position where a lot of people want to be more interesting. Okay. Well, exactly. A lot of people do want to give us kind of more, how would you say, proper institutional capital. But I think the question for us is, to your point about time horizon,

we really need to make sure that this works. And I don't mind kind of, you know, losing my money or... It's going to work. It's going to work. I mean, based on how many angel investments did you make before you did this? Myself? Yeah. You said you did some angel investing? Quite a bit, yeah.

Over 20, over 30? Probably over 30, yeah. Yeah, once you break 30, you know you probably have an outlier or four in there, especially if you were at Y Combinator previously, you got to skim the cream. So you've got three or four winners in there that are outliers, I'm sure, out of your 30. We certainly have a bunch we're extremely excited about. Yeah. So, I mean, you need only hit one out of every 50 to be an outlier here, you know, a modest outlaw.

I'm not talking about an Uber and Airbnb. I'm talking about like a billion dollar outcome. It all pays for itself. So, I mean, there's really two different ways to structure it is. I would just do 100. I would just do like a, the best. interest of you and your partners would be to have small funds like SPVs, which you can do with a company like a shore, which we're investors of, and which used to power angel list, but power

seed invest, et cetera. You pop up in SVV, you ask your high net worth friends, hey, for the next hundred companies that we invest in, we're going to invest $3 million in the next $100 to $200, and we're popping up this $3 million fund. And as part of that, you get to see the list of what we're investing in, because that's what Mark Andreessen is doing it for. He was, in my first fund as well. You know, he put small checks into a bunch of funds. This is very well known in order to like, you know, sort of help build his network. And I was the first Sequoia scout and the first syndicate on Angelus. Like the reason people allow... Really? That's remarkable. You're like first to all of these... What are you first to do now? First to finding you. No,

I missed you. But no, I could tell you a very simple philosophy I have about how to be early on to ideas. But this is more about you right now. But you ask me how you do it. And it's a really interesting discussion because I'm on my third fund now and I've been doing this for 10 years. I think small funds for folks like us, purposely small funds, are better because you'll have a higher cash on cash multiple. And the bigger funds then will push you downstream. I've been trying to say upstream near the well. And this is what I always talk to people about.

if you look at venture capital as an asset class, they had this incredible orchard known as startups. And they were like, you know what? Tending to these fucking trees is so much work, we're out. Bring us YC, tech stars, launch accelerator, seed funds, angel list, seed invest. You guys tend to the orchard. Bring us a bushel of apples. We'll pick the best apples.

And I just thought this is the stupidest strategic move ever. And when I saw you, I was like, oh. they are, they're planting the trees. I'm running the orchard, but this guy's planting trees. Fuck. I didn't know there was another level. That's why I was so enamored with what you're doing, Daniel. And I was like, I told my producer, Nick, I said, this is the number one get.

Like, even above YC, we invited Michael to come on the pod. He didn't like me, but he didn't come on. But I was like, what you're doing is planting an orchard. Right? Well, we're certainly stuffing a lot of things into the ground with the help of a lot of other folks and we're pouring a lot of water over it and we're praying. You're very humble. You mean either you're being tremendously humble or you don't realize exactly what a powerful position it is. When I studied power, when I came to Silicon Valley or in the tech business in the 90s was as a journalist, I realized there was like two really interesting points of power.

One, the person who finds a company, i.e. Sean Parker bringing, you know, Zuckerberg to Silicon Valley and introducing him to Peter Thiel. Like, that person is so powerful. That's you or me in this, or Y Combinator, Paul Graham, et cetera. And then the person can write the biggest check, right? Well, Yuri Milner or Sequoia, just somebody who can write a big check and has like those big pocketbooks? Everybody else in between is kind of a commodity, right? Like, who does your series B? You know, like whoever paid the highest price with the least rights, right? Who did your series say? It's like whoever will give us $20 million and not take a board seat. So there's a million ways for you to do it. But I think for you, being able to build your position, what is your follow-on strategy? That's my number one question for you. What's your follow-on strategy to build meaningful positions? Because 1%, you know, when I started my career, I had under 1% of a lot of great companies, but it generally winds up being a small number unless you hit an Uber. You want to have 5, 10% of companies. So do you have a plan to get there to get to 20, 15? 20% yet? Yeah, it's a good question. And look, yeah, I understand. I've been my entire life an avid reader of S-1s in 10Ks. And so I'm familiar with the power of concentration, if you get it right. Yeah.

I was, you know, I was the teenager with the stock trading problem. Yeah. So I, but, but I do think in it for the, even as an LPN pioneer, it is in our best interest to be as useful as possible. as possible to the largest number of people we can take bets on. Because here's what I find so interesting about our business model. The more kind of life-changing we are to the person, the more pricing power the organization has. And, you know, we don't have like a structured, how would you say, goal we have to get to in terms of position and allocation in any single

company. And maybe we'll evolve over time and we'll create that. We're just kind of young. But the high-level mandate that I find so interesting is that for us to actually own 10%, 20% of a Pioneer's company over time, we really have to be remarkably impactful in how much we change their life. And I think that's a very healthy North Star for the organization to think about. And in many ways, I often wonder about companies' pro rata rights, when the percentage is quite large, so when you have a 25% pro rata right, it kind of makes you not have to sing for your supper. And I'm not sure that's a good thing. You know, we think a lot about how we can make our pioneers successful because we need them to be successful for us to be successful.

Yeah, but don't, I agree with all that. But, you know, from experience, how sharp elbow, those series A, series B investors are about keeping their parrata and saying, I won't do this deal unless I can hit this ownership percentage. What I learned over time being early stage and getting run over or VCs trying to run me over time was I fixed a leak in my game, which was I didn't have enough ownership in the companies early on to even know they were doing a new round, to even have a board seat in the winners, right? I didn't have a board seat in Uber, didn't have a board seat in Superhuman or Com.com.

And in those I owned under 1%, 2% of Superhuman, 5% or 6% of Com. But then later I said, you know what, let's try to get to 10%. let's try to have an option of a board seat. Let's try to have some future pro rata right. So I think the way I fixed it was having the right to invest more in the round after they graduate for more accelerator, which is what I think you should do. It's completely reasonable for you to say it's 1% when you join. If we put the 10 or 20K in, we're putting it in, and we just want to have the ability

to put in another 250 in your next round or 100 in your next round or 100 in your next down and 250 after that. Those founders are going to be more than willing to be. to give you that right. And then if you do hit an outlier, you're going to own 10% or 7% and you might be able to be on the board of that company. And I think that because you're willing to do this hard work with thousands of people a year and invest in 100 people a year, whatever it is, you deserve that right. You deserve that. And you deserve it and I deserve it and Paul Graham deserves it. Techstarters deserves it more than the series B jerkoff who comes in

with $20 million check and says, everybody before me doesn't count. All you people who put it in the four years of hard work with the startup, you don't count. I count. When we get back from this final break, I want you to think about what I've just said to you and tell me your decision when we get back on this week of startups. Yes, doctor. Hey, it's a little weird right now. We all know that.

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And you can do that most easily. and elegantly and simply and now free with Zendesk.com slash twist. Get in there, everybody. All right, very real conversation going on here with Daniel Gross. Thank you for participating in the discussion in an open way. Most people don't like to talk about portfolio construction where this dynamic in the industry with the early investors get screwed. They consistently get screwed.

And in fact, you know, it's one of my big pet peeves and one of the things I fixed in the last five years after getting elbowed in the face three or four times, you know, like we're point guards in this and now? You know what, you know basketball at all, Daniel? You're a fan of the basketball? I thought, you know, I grew up in Israel. I thought I was tall. I thought I was a great basketball player.

And then I came to the U.S., let me tell you. I mean, I'm barely six feet. So I'm definitely not playing professionally, but go ahead. Well, we're the point guards in this. We bring the ball down the court. Yes. And you give it to the forward, you give it to the center,

they put the ball in the basket. And for the center, or the power forward or whatever it is, to not pass the ball back to you in their double team and let you take a three-pointer once in a while. When you brought the ball up court and you're like a pass-first mentality, which is what we are by definition being the story stage.

We're past first, right? We want to get Sequois, you want to get general catalyst, you want to get benchmark, whoever to do it. If they then go screw you, and I've had this conversation four times in 200 investments, where I told a venture capitalist,

if you ever try to screw me like you're trying to right now again, I will never work with you again, I will never send a founder to you again, I will tell founders that you try to screw me and that you will try to screw them, and I will never pass you the ball again. I will freeze you out, and I'm a point guard.

I'm Chris Paul in this analogy. I bring a lot of good balls down the court. I put it where you want it. You will never get a deal from me, and I know who your top five competitors are, and I will bring it to them. And man, you will see a VC wilt, like that.

three out of four times it worked. One time I got one person who screwed me and that person doesn't even know how many deals they didn't get because I said to a founder, let me tell you the story about that firm and how they screwed me and you make your own decision.

I'm not going to introduce you to them, but I'll tell you the story. And that one firm that screwed me and they know because I sent them an email last week reminding them how they screwed me five years ago. I never forget. I never forget. My largest learning from this podcast,

podcast was not to mess with you. So I'm glad. No, it's not that. I think this is a team sport is the point. Everybody wins or loses together. That's your point. But there's this weird dynamic. And this is the way a person said it to me was, and I hope I'm not being condescending because I know you're very successful. And I'm in awe of what you're doing. Honestly, Daniel, I'm really in all of what you're doing. It's the most impressive thing. Literally improvising at the piano keyboard. And there's no scales. So go ahead. Well, it's, I, I, I, I know raw talent. It's one of the few things I know.

And the reason I'm telling you this is because, my gosh, like, this person literally said to me, Jason, Jason, I had to eat shit in this industry when I came into it, and you're going to have to learn to eat shit. That was literally what the person said to me. And I thought I was friends with this person. And I stopped them. I said, I'm sorry, you had to eat shit. Let me tell you right now in no uncertain terms. Jason Calacanis does not eat shit, period.

And then I told them they'll never get the ball past. wrote me an apology letter the next day, an email. You know, I've thought about it because they wanted me to give up my board seat, give up my pro rata, and give up my information rights. Because at the time, I couldn't write, you know, the 500K check. It was early in my career. I said, if you do this, you're never getting the ball past you again. And I went to the founder, I told the founder, and I said, I'm going to tell the founder

exactly how many unicorns you have, zero. And then I'm going to walk them into Sequoia, bench, Mark, Kleiner, Excel, Indreason, and I'm going to show them how many unicorns they have. I will personally walk them in next week, and I will tell them the offer you gave them and how to beat it. This VC couldn't believe that I stood up to them. But the point is, you're only going to win if you have five or ten or fifteen percent

of whatever the breakouts are. And we should want you to win. So anyway, that's just a long way of telling you this was the mistake and the pain I went through when I became an early stage investor. And you see this, the people who invested in the, a bunch of people invested in a syndicate

for Giffy, that just got bought by Facebook. And they all got screwed. They all got washed out by later rounds from what I understand. I don't have the actual facts. So what's your long-term concentration strategy on your winners, Daniel?

Do you have one? I will refer all strategy discussions back to you. Anyway, I would think about that. I think it's, and how do, when you find one that's a winner, yes. What do you, how do you counsel them on what to do next? Do you help them raise a seed round?

Because this is a lot of times why people are coming here. You're saying there are people who haven't been part of the system like you coming from Israel to the valley. And Paul Graham and Jessica shepherded you told you, hey, this is a mistake. This isn't. Hopefully they gave you great advice. They're known for giving great advice. What advice do you give them?

Hey, this has got potential. You should raise a seed round. You should go to Y. C. You should whatever. What's your role there? Yeah. I mean, I think advice is so interesting in the sense that often breakout companies, actually

all companies come to, and I'm sure you experience this a lot, to the advice giver with repeated trope questions. And the advice giver gives the repeated trope answers. And this continues generation after generation, after generation. I'll give you an example. Hey, we're trying to figure out what to do with Bob. I'm not, I'm thinking of firing him, but I'm not sure. What do you say?

Fire Bob immediately. What do they say? Ah, they call you always two months later. I just fired Bob. Should have fired him the next day. I can't believe it. Never make that mistake again. Hey, I'm trying to figure out which firm to take the offer from.

You know, firm X offers valuation Y. Firm, you know, B offers valuation Y plus 20%. But I don't like them as much, but I'm still going to take their offer. What do you do? And you, of course, say, focus on the partner that you like. And they, of course, take the higher offer. So what's so funny to me about advice is actually a friend of mine, founder of Stripe, John Collison, had a good point. That advice is kind of equal parts, content and delivery. So I could tell you something, but it's just not going to get delivered properly. Kind of like how certain drugs, you know, a lot of the science there is kind of breaking into the nucleus. And I feel like in similar vein with advice, you know, the thing I think a lot about is I kind of know what I need to tell you. I have the content and figuring out the delivery is the interesting bit. So figuring out a way, sometimes I realize when someone's asking me, for example, about that employee issue, about letting them go, I realize nothing that I'm going to say is actually going to change your mind now. And maybe you need to talk to someone else, someone new, someone fresh, you haven't spoken to that you deeply admire. who will kind of do whatever you tell them to do.

So that's a situation where, I don't know, you may want to think about advice a little bit more kind of creatively than that. And I think especially in the early stages of startups where it's actually pretty much the same set of questions over and over for team building, firing, hiring, product market fit, fundraising. A lot of the reasons why people take the wrong steps isn't because they get bad advice. It's because they get good advice. That's, how would you say, cognitively dissonant? and then they don't follow it.

Right. And a lot of these things you have to learn for yourself, like hiring slow and firing fast. You know, you... Only experiential learning. Yeah, you learn it over time because you're like, oh, I need to, when you're 10 or 20 years in your career, you're like, yeah, hiring somebody to fill the position

and then having to fire them three months later is just arduous and painful and stupid. I don't care how long it takes. Let's get a culture fit who actually loves this vertical and who wants to do it. Every company I see succeed, we have a company called FitBod, which is done incredibly well,

and they're like a CrossFit fitness app, and they hire people who like CrossFit and who like working out, and those people don't turn over. But if you said, I want to hire an iOS developer, and I want one who loves to work out, you've just narrowed the field

to like 10% of the field. But, so theoretically, should take you some magnitude longer to find them, or it might take shorter because, you know who you're looking for. And the same thing with Steezy, a dance company we have.

They hire people who love dance. And boy, does it reduce retention and makes it easy to manage people because they show up for work every day working at their dream job, right? And that's a perfect example. And how you give the advice is also super important. I'm wondering, you were early on with remote. What have you learned about running a remote accelerator that I don't know, that other people don't know? and then how has it changed in the age of COVID in the pandemic? What is your intellectual property?

And please list it out for me. No, I'm super happy to share. Well, I mean, this is, I mean, you've just, I think you literally just unpacked the point of the podcast, which is for a decade and a thousand plus episodes. I've had some people smarter than me on and interrogated them and gotten smart. It's literally the point of a podcast. To have people on and then build a relationship with them.

So hopefully I can become an LP in your next fund. And hopefully you can teach me something. It would be great if I could just see the entire checklist of your objectives and what you consider accomplished. What are your KPI? Yes. What's your roadmap? Please put it on and we'll share it with 250,000 people. Yeah. Remote is, I actually think this is a very important topic.

And just for people to understand how to work in a remote world, I by no means consider myself an expert on this. I do think a person, you know, an example of an expert, I think is Sid from GitLab. who, and by the way, the nice thing about GitLab strategy is it's all documented in public. You literally go read it. If a lot of people have asked me, what's the best book on remote work? It is actually GitLab's employee handbook. I would just go read that. It's out there on the internet and it's free.

What are the key points in there? Yeah. Yeah, here's the TLDR of like a lot of stuff we've learned in remote. The main thing you lose when you're remote in a company or in a community, say an accelerator, as the latter example, is serendipity. interaction with other humans. And you need to, you know, just like in space, because there's no gravity, you must work out unless you atrophy. In remote, there's no social gravity. And so you must have forced interactions so that the connections do not atrophy. You're not going to be able to

build, you know, there's all sorts of like remote serendipity companies now that are getting started and presence and whatever. I hope some of, there's some pioneers working on this. I hope they all succeed. Until then, it is incredibly important that you guys get together. Audio or video, doesn't matter. My second point here is video is overrated. Audio is fine and have what I call non-goal-oriented conversations. Non-goal-oriented. Ah, the check-in. Yes. Let's just talk about talking. Now, the issue is it's pretty hard to do that when things are scheduled. So you can have scheduled conversations about goals so we can get together for this podcast and I can interact with you and actually build a relationship with you because there's a goal in mine. In fact, you have many goals

as it turns out. But what would have been hard to do is just get on the podcast. We didn't really know each other beforehand and just be like, let's kind of talk. That doesn't work well. And so if you want to have non-goal oriented conversations and if you want your kind of team or community to do so, you have to have other things to do during the conversation. playing poker with the team. It doesn't really matter about the poker game or whatever, but it's an excuse for people to talk. Finding shared common interests people have ahead of time

and then pairing them based on those interests. You both like running. You both like basketball. And then giving them prompts. That's another example of something that works. What's an example of a prompt? Well, for example, you know, you both happen to like basketball. What did you think of the Michael Jordan documentary?

I know you both watched it. Yeah. And what I mean by that earlier gravity metaphor is you have to apply work here because things will fray organically. You can kind of quantify the strength. Imagine for a moment you could mathematically quantify the strength of the relationship between different nodes and the network. When you see people in the real world, you get free reboosting of that signal. Oh, you know, it's so good to see them. They're a real person, whatever.

Over time, in the digital world, that's the phrase. Now, you can maintain the strength of the links if you have chat open, if you have video open. There's all sorts of things you can do, but you must apply active effort to it. Otherwise, things will atrophy. And there's a lot I can say on this, but I should close something I briefly mentioned before. I really think when you're talking with, it's one thing for us to be having a conversation, high quality video and audio setup. Most people in the world don't have that.

I really would do away with video and just do audio. and other stuff. I've started doing that now on my Zoom calls because I am so exhausted from being on video for seven fucking hours a day in this goddamn pandemic as an extrovert. Are you an extrovert or introvert? What's your Myers-Briggs? I'm curious.

Are you ENTJ or INTJ? Or you fake it? As I'll take whatever answer you want to apply to me. You know, what is it? You know what it is. What is it? I have a complicated answer that I'll say very quickly. I'm a very deep student of psychometrics and have zero faith in MBTI as a framework.

That being said, if you really want to put me in a box, I'm more of an introvert than an extrovert. It's very hard because you come across as extroverted here, but I know extroverts who have learned to deeply engage in a conversation, but they prefer to be introvert. I've been training for this moment for the past six months every single day, staring in the mirror, watching. Do you feel exhausted, though, after like an hour-long conversation or something? something like that? Does it, did you feel like you need to go read a book or have some alone time? No, because it's interesting. I do get very exhausted with small talk. I find that drains me instantly. I'm unable to do that. And I actually think the main barrier between introverts and extroverts, in my view, is a bit more subtle. It's what you consider small talk. For like, I have very,

for some reason, maybe I should be more mindful, but my brain has very high content demands. So it really has to be very engaging. That makes total sense, right? Like some people are so extroverted that any talking or conversation is fulfilling. Correct. This is a very interesting observation because I have introverted friends who can get very animated and engaged in a conversation that's vibrant. But I wonder if I'm just throwing out a thesis here. If the conversation is not really providing a lot of intellectual stimulation or value,

I would rather be using those, that energy for something else. Right? Like, what's the point of this? Correct. I think there's something about, there's so much going on in my own inner world for me to suppress that. It requires what I'm steering at to be very engaging. I think this is also why I see a lot of introverts be much more interested in reading than watching things is because it's watching is not fast enough. We're reading, you have to, it's not a treadmill. It won't run for you. You have to push every single, you know, word. Yeah. That's another interesting observation. Do you see any pattern? post-COVID, i.e. more people applying, more people wanting to participate because they're stuck at home or because they got their webcam set up and now they can participate. Yeah, I mean,

the true interesting trends for us is there's certainly more overall activity, but anytime quality, sorry, quantity goes up, quality goes down, so our retention is down a little bit, but overall activity is up. I think that also means we're just getting more people now. I think this is a very fascinating generation. I mean, we've, we've basically, you know, we know that dropouts create great companies, and nature just decided to run this terrible experiment where it turned everyone into a dropout. So the outcomes of this year, I think, I think the second third order effects are deeply, deeply fascinating and unstudied. Yeah, what do you think some of those, I had somebody, somebody referred to it as the great pause. What do you think the outcome of

the great pause will be? What do you think a second or third order impact might be? Tyler Cohen actually had the brilliant I don't know if this is his idea or hear it from someone that the funny concept of maybe what we should have done is literally pause time because that's kind of what the economy needed is if we just would have said it's still March 12th

resume now it's March 13th yeah it's a really interesting idea the seasons we get a little screwed up but it's interesting what no seriously what do you think the changes might be obviously people I have a phone call this week because a friend of mine said, can you talk to one of my best friends who's considering going back

to Stanford for their MBA, which will cost them $200,000. And it's going to be remote. So should they, I think it was Stanford. It might have been Penn or Harvard. Anyway, it was one of the big schools. They don't know if they should be $250K in debt or if they should go deploy that some other way. I'm like, well, that's a really easy question. Like spending $200,000 on a Zoom education makes no sense.

What do you think the second order or third orders that you're looking at are? Well, we can kind of, I mean, in terms of maybe first and second order, I like to think of it as a bit of a Gartner two by two, which is, you know, what are things that are, nature has put us through like this AB test, right? And so we're living in a different variant of the world. And so kind of one axis is what things will kind of go back versus stay. and I think a lot of it is driven by the other axis, which is in what situations is the alternative, is the alternative that we've been exposed to better or worse. So it'll be an example. Handshakes, clearly not coming back because not doing handshakes is fine and the cost of doing handshakes is now potentially, you know, a terrible disease.

The inversion of that, in my view, is restaurants. As it turns out, not having restaurants is a bummer. People really want them. And so they are going to come back. Now, there's a lot of stuff that kind of gets caught here in the middle, which is you know, at work. Does the office, does it matter? Yeah, going to an office. We don't really have the data on that, whether, you know, some teams increasing efficiency, some teams decreasing efficiency. So on the margin, I think we're

actually going to see teams disappear. So a lot of discussion of that on the internet. I wouldn't want to bore us with that. The third order effects I find very interesting. And the one particular that's on my mind is, how does this change the kind of undercurrent psychology in terms of making people more tribal versus more porous. I think, you know, for example, you know, two very obvious changes that I think will kind of just drive how people think and operate. One is just this notion of any human I'm walking around can be carrying, how would you say, like a biological machine gun almost. Yeah. Yeah. They're armed. They're armed. Everyone could be armed and this requires you to do a lot of, I'm sure you're doing a lot of weird calculations I

find myself doing as I meet friends, which is like, you know, do I really trust them when they've been quarantined? How clean are they as a person? And you're trying to project all this information from almost no data points. And that type of worry, I think will make things a little bit less porous and people a little bit more clicky, a little bit more Facebook groups. Yeah. And less, sorry, more WhatsApp groups and less Facebook, so to speak. Yeah. The other thing that I think must just must change, given how humans operate, is if everyone walking around with a mask is different. You know, you look at people with masks. There's something going on there that is just a different in the way the neural net of your mind perceives the face. Right. And, you know, I find, you know,

I can't see someone's expression quite clearly. There's something that looks a little bit guarded about about it. And so I don't know, I find it, it does change human psychology about other humans quite a bit. And I do think one of the most important things we've learned from social media is it's really important for humans to physically see each other as much as possible. Yeah, that's what we're learning. That's, I think with the going back to work issue is really interesting because I think you said it well, like, will that come back or not? Will people be more efficient or not? That's the one I'm thinking about because I look at something like Facebook or Uber or Google and I'm like, you know what, I don't think those companies could have been built during their high growth periods

without a campus and everybody in the room, you know, like grinding on that and that grinding culture. And while I do think people enjoy working from home and that flexibility, I also think people are going to get kind of stir crazy and they're going to, some group of people are going to want to be in an office. I'm already seeing that myself personally and across a range of kids. Well, especially if you have kids. And this is another order of like homeschooling, like, It's not going to be on the table for people? I've been thinking about that. What do you think happens to cities?

I'm curious, because you are an international by design, remote by design enterprise. So you obviously bought into this. What do you think happens to cities? And do you see some trend with what cities are overrepresented and say Pioneer Labs that were underrepresented or not overly represented at your time at YC? Yeah, I mean, so in terms of what Pioneer sees, I will say, you know, it's quite international about half the traffic is just, you know, non-U.S. global world. Yeah, the half, which is interesting. The website is in English. We haven't really done any

growth work period, you know, internationally. You know, maybe some slivers and phone calls, but not that much. And it has quite a spread. And so, and even a lot of the American traffic, Like, it's not, you know, SF. It's, you know, someone in Indiana. So in terms of representation, you know, I think we see that the standard things you'd expect. All of the other kind of technology hubs of the world, you know, there's a lot of activity from, obviously, Europe, there's a lot of activity in India. There's a lot of activity in Nigeria. There's a lot of activity in Eastern Europe.

And so, you know, that kind of remains alive and well. I think there's a very interesting question about will 2021 be, will Silicon Valley and San Francisco in particular be the capital of technology in 2021? That, I feel like right now is the question on everyone's mind. And, you know, my worry is that the city for a very long time has been mismanaging itself. And, you know, just like we mentioned before about eternal September. cities also go through effectively three stages of development in my view all communities all scenes go through the same three stage it starts off as a frontier where it mostly has interesting people who wouldn't go there normally who go there it becomes famous and it gets kind of your kind of normies

and then over time things do tend to fail now for internet communities this could happen in a matter of days for companies it takes years and for cities maybe it takes centuries i do wonder if san francisco is kind of obviously in this in middle state now where it's famous. It's attracting both great founders and just like a lot of normal people. As the city continues to mismanage itself, you know, at what point does it, does the founding kind of tech scene break up into other parts of the Bay Area or into other parts of the world? That I don't know. But that's a, huge question on my mind. We are thankfully agnostic, you know, pioneer can float to whatever the real world capital is. But, you know, I think, you know, just personally, almost everyone who

works at Pioneer is in the Bay Area. And we're kind of wondering if we want to be able to greet the door to our best pioneers as they arrive off whatever the future Ellis Island is, where should we be? Should we be in London? Should we be in New York? Should we be in Cupertino? I don't know. I don't know that it'll be SF. SF is, I think, got the, all cities that are high priced have one issue, but that a mismanaged city that's also high priced, this is the worst of all situations because even people who we know who are contemporaries who can afford to live here, they're like, what's the point? The place is just so mismanaged and it's so terrible, and we know the taxes are going to go up and why would I even stay here? What's the point?

I mean, people feel that way about California as well. So I think this is like, this is more, this is an acute issue. This is not like some existential thing. People every day who I know, who are absolutely price and sensitive are saying, it's not worth it. And it's like, but you're rich. And it's like, yeah, but I just don't want to be a sucker. I don't want to be here if this is unnecessary. And there's better places to be that are better run.

And I think everybody's going to go north and south of the city and east of the city, right? So Sacramento, we're seeing a lot of people. People are going to Santa Cruz. People are going to St. Louis Obispo. Obviously, people are going north to Napa and other communities, north of Healdsburg. So I think it's going to be, I still think the Bay Area is the special place, but San Francisco itself, which wanted to do an IPO tax, like, what are they going to do now with this crazy budget, this giant budget, terrible services? And then everybody's like, why would I, why would I be here? The tax base could collapse. And commercial real estate has already collapsed. And already there, for the first time, I've never even heard of this, but I was being told that people were offering two months free rent in San Francisco and the rents are 20% off. I mean, Can you imagine sitting here two years ago and saying you're going to get two, three months rent in San Francisco and 20% off the price?

I think what the other thing that's happening is to our earlier framework of, you know, people trying alternatives on the forced AB test of nature, just like people realizing they can survive without handshakes. I think many are realizing they can survive without San Francisco, you know, as they currently sequester with their parents somewhere or somewhere else around the Bay Area. So yeah, it's unclear to me what what the return is. And it's, you know, on, how would you say it? It's sad that San Francisco lost the opportunity to truly become a capital of the West and possibly of the entire modern world. The good news is maybe the tides have shifted and people will migrate to another place where, you know, local governance is, you know, a little bit more able to respond to the needs of the economy. That is the very weird part of all this is the liberal cities are, um, devolving, and then I see liberal people moving to Republican and conservative areas because they're higher functioning, like Texas and Florida. Like, these are the destinations now, and San Francisco and Seattle are going backwards,

and those places are getting the highest-end people who are moving to those places. It's very strange when you think about it. Maybe it isn't strange when you think about it. Maybe it's strange that San Francisco held on for this long. Well, I mean, I do think California broadly still remains the iconic land of the frontier. You know, I think it has some serious questions ahead of it just in terms of tax rates and, you know, the fact that such a large fraction of its revenue comes from the top 1%. And the fact that it's going to run a giant deficit this year and the fact that San Francisco may become the last city to emerge from lockdown, you know, will have terrible economic cost. I do think it has a reckoning to come to.

But, you know, I'm hopeful, I'm hopeful that we could get our way out of this because I'm sure you've had this experience too. I certainly have now traveled to a couple of other countries. And I'm always struck by how California literally may be one of the best places in the world, just in terms of how God laid out, you know, the planet. I mean, Northern California is just particularly gorgeous. Like to be able to serve in Bolinas and ski in Tahoe. You know, all within a couple of hours each other and Los Angeles and San Diego and everything in between. It's just stunningly gorgeous.

But, yeah, it's a very weird time. Well, listen, I kept you for over an hour, and I really appreciate you taking the time. I'm encouraging anybody who has an idea, you know, to go to pioneer.com. And start pursuing it because they're really, you're the only person doing something in this specific section of the world, which is somebody has an idea and they don't feel like they're part of it and they just need a little encouragement and a little framework and you've done that

and I think it's tremendous Daniel I am really impressed with what you've built and it's only in year two now so I really think the sky's the limit and really just great to have you on the program and it's nice to see somebody with fresh eyes on a problem and if you're a founder if you're wondering if you're listening to my voice

and you're wondering gosh can I do it well you just go to Pioneer. slash, I'm guessing it's a supplier. So we go to Pioneer. Dot app and just say start. I think you just get started. There's a button.

And just get started. And what do you have to lose? It's basically free. I mean, 1% of your equity means nothing in a speculative project. So that's, I mean, it's the best deal in town as far as I'm concerned.

Oh, I appreciate you saying that. And yeah, I mean, you can even, you know, you could reject our offer at the end. It really doesn't matter. The whole point is you. Oh, you're allowed to reject it?

I mean, it's, is a free market. You do whatever you want, right? So the whole point is you can get started with a pseudonym. I mean, no one can know who you are. No one will see you in your nakedness. And if you fail, no one will know. If you succeed, you can be anonymous?

Yeah. Oh, I'm going to start my new company there. I have an idea for a company. I want to go there and just be part of it and just be to see if I can go to the top of the leaderboard. That'd be hilarious if I did it and then got on the, got on the phone. It's like it would be as if Lance Armstrong joined a Peloton class. So yeah, let us know. Yeah.

Lance is, I just got introduced to Lance Armstrong because he's doing, he's doing a fund. Or he wants to do a fund. Of course, right? Exactly. Like anybody's going to do a fun. It's like anybody's got a podcast. All right, listen, Daniel, continue success. Stay safe.

You can follow Daniel on the Twitter. He's Daniel Gross, G-R-O-S-S. And this wraps up our Power of Accelerator series with a bang. Like I said, if you got an idea, go there. and I'll be trolling looking for ideas there. Continued success and thanks for taking the time. Have a great weekend, Daniel. Thank you so much, Jason.

Your energy and dynamism is legendary. Thank you for that. All right, thanks to everybody for supporting the podcast. I know a lot of advertisers out there. Stop spending money during the pandemic. I know it was pretty scary. You didn't know what to do with your budgets. But oh, my God, you all stuck with us through this.

And, you know, we got five, six people working. on this podcast full time. And I really do appreciate to the advertisers who support this podcast. I don't do it for money. I do it to really help inspire people to start companies and to just maybe give them some inspiration

twice a week and we couldn't do it with actor support. So thanks to all the sponsors who stuck with us during this really challenging time. And I hope we're producing for you because the ratings are up. Listenership went up.

That's interesting. More people are tuning in. I guess people have time. Thank you. All right. Stay safe, thank you. We'll see you all next time on this week's stars.

Bye-bye.