This Week in Startups - Full $FB earnings breakdown, NFT company violates music IP + Behind Genius' Paige Finn: Angel S6 E4 | E1377

Episode Date: February 4, 2022

In the opening news segment, Molly and Jason break down the numbers behind Facebook's colossal drop in market cap (2:42). Then, they cover a company that seems to be violating music copyrights to sell NFTS (38:14). Then, Paige Finn of Behind Genius joins for Episode 4 of Season 6 of Angel (49:45). Paige became interested in venture capital during college, but within a year and a half of graduating in 2020 she already has a fund!  In this episode you will learn: 1. How she secured her first allocation before having a fund 2. The steps she took to set up an SPV while being a non-accredited investor 3. How she raised a $1.6m fund 4. Behind Genius' investing thesis and strategy 5. The books that have most influenced her work and writing style 6. Why she wrote a picture book (for adults) called "Seed to Harvest: A Simple Explanation of Venture Capital" 00:00 Jason & Molly introduce the show 02:42 Facebook's painful $220B market cap drawdown 07:32 Is blaming Apple 10:29 LinkedIn - Post your first job for free at https://linkedIn.com/twist 11:37 "This is one of the most hardcore hits I've ever seen in business" 14:11 Would Zuckerberg leaving hurt the company even more? 17:33 Do rebrand's ever really work? 20:08 Embroker - Get an extra 10% off insurance for your business at https://Embroker.com/twist 21:29 Could Facebook have been a successful hardware operator? 25:03 Breaking down the numbers around Meta's future business 30:32 Ourcrowd - Check out the deal of the week at https://ourcrowd.com/twist 31:51 Is there a solution for Zuckerberg? 36:28 How Jason's divorced friends use Instagram 38:12 NFT site "Hitpiece" accused of trying to sell songs without consulting original artists 49:44 Interview - Paige Finn of Behind Genius 52:02 How Paige learned about VC in 2018 55:28 Behind Genius' investing thesis and strategy 1:00:05 How Paige set up an SPV while being a non-accredited investor 1:10:11 How her book "Seed to Harvest: A Simple Explanation of Venture Capital" helped her gain credibility 1:13:51 Paige's most influential books 1:23:09 Paige's day to day life as an investor 1:33:55 Plugs from the TWIST team Check out Behind Genius Ventures: https://www.behindgeniusventures.com FOLLOW Packy: https://twitter.com/paigefinnn FOLLOW Jason: https://linktr.ee/calacanis FOLLOW Molly: https://twitter.com/mollywood

Hey, everybody, it's another amazing episode of this weekend startups and the Angel Podcast. So you can search for Angel Podcasts as well and find a bunch of religious people talking about God and angels in the world. Or if you type Angel Calacadish, you'll find this podcast. It's season six. And Paige Dardy is an amazing guest. She runs behind Genius Ventures. She just graduated two years ago in 2020. So, yeah, the world has changed.

People are coming out of college and starting their own venture capital funds. She wrote a children's book, demystifying venture capital. I kid you not. An amazing guest. Love everything about it. But first, we are going to cover the news

because big day at the stock store, Facebook, meta's stock was down something like 24% at 1.26% after a rough earnings in which they project a $10 billion loss. Jason, by the way, if you are not watching the video,

is just covering his eyes from the sheer murder that was committed. It's just hard to watch. I mean, it's just watching somebody get just absolutely beat up. Is it, though? Is it hard to watch Facebook? No, it's actually quite enjoyable for me.

It's quite delightful. Yeah. And then we're going to follow up on our intellectual property conversation about respecting other people's work in the world and art with an absolutely insane NFT project called Hit Piece. That is a queues and apparently is based on their apology, stealing NFTs based upon Britney Spears or Taylor Swift's music without permission and then selling it

just more horrible behavior in the IP space and we're going to teach people in this quick segment how to be decent human beings. It is going to be a great and very informative show. Stick with us. Season 6 of Angel is brought to you by LinkedIn Jobs. A business is only as strong as its people

and every hire matters. Post your first job for free at LinkedIn.com slash angel. The Embroker Startup Insurance Program helps startups secure the most important types of insurance at a lower cost and with less hassle. Save up to 20% off traditional insurance today atembroker.com slash Twist. While you're there, get an extra 10% off using offer code Twist. And Our Crowd. Our Crowd.

you invest early in pre-IPO companies alongside professional VCs. If you're interested in investing, you can join Our Crowd for free at OUR-C-R-O-W-D.com slash Angel. All right, everybody, it is a huge, huge newsday because, wow, we expected this would happen at some point, but we didn't expect it would happen this dramatically. Sometimes a company faces so many headwinds that you predict, hey, this is not the stock to own, this is not the company to work for. And I've been staying that for about, I don't know, two years now. And everybody told me I was crazy.

And I told them, you know, these headwinds and these things pile up and that at some point it hits the bottom line. But there is always a lag. And this company, Molly, has had negative PR. It has had regulation issues. It has had political issues. from its advertisers because

on-go- and it has had competitive issues and slowing user growth and the inability to buy its way to success and that company is sadly that company

named itself meta in a kind of embarrassing for all of us attempt to outrun all of those issues like I sort of feel like the moment that you know

things have really approached or reached perfect storm status is when you change your name to try to run away from them. So yes, meta or Facebook has dropped over 25%. Oh, I see, as of this recording, 26%. Oh my God.

Yep, just keeps going down since reporting earnings yesterday. That was Wednesday. They projected a $10 billion loss of revenue from Apple's privacy features. And for the first time, negative user growth quarter over quarter. The stock dropped from $323 a share to $238 a share of 1 p.m. Eastern on Thursday. This represents a $220 billion loss in market cap overnight. Gone. I mean, it's like, where do you begin?

I want to begin with a fun fact, actually. This is pretty fun. The largest single day decline in Wall Street history beating Facebook's, $119 billion decline in 2018. Got it. So this is an example of, I think, in a way, a bit of hubris here. I love your observation, Molly, that why did they change the name of the company and what did that represent? Now, for Zuck, knowing him and how he thinks, he has been obsessed with not being disrupted and being a disruptor.

That's why he had the philosophy, move fast and break things and lock, people down. That's the concept of a lockdown where they would just, you know, out hustle any other company, stealing other people's innovations. I don't need your unique ideas. I need you to just whatever Evan Spiegel does. And, you know, I was kind of talking about that years ago. I was like, you know, if you're stealing Evan Spiegel's ideas and you're out of your own, that's a really bad sign for your company's prospects. Of course, you can steal your way for a while, but this idea that they would change their name to represent a product that loses $10 billion a year, VR, that has no value in the real world yet, no revenue to speak of.

I mean, they saw some headsets, but let's face it, this is a business, the metaverse, that doesn't exist yet. And by the way, is also a stolen idea. Also a stolen idea. And Goody Gibson and everybody else who invented it literally by that, right? So it's not even, it's not even like. They stole the moniker. They stole the moniker and frankly the concept from like existing sci-fi.

There's not even like some kind of vision of it that's even no original spin. No original spin. And I really do think that from a PR perspective, changing your name is usually a sign of desperation. I really do like sure it could also be, you know, in the case of square where they're going with block. It's like we're taking the company in a different direction. Right. And that direction is equally unproven different conversation here. But like Metaverse is at best a 10-year bet.

The headsets themselves are churning users right now, as you have talked about on the show. And we've talked about I was one of those users who bought one and is just like, this is crickets now. Yeah. But I don't think we can sleep on a couple of different factors here. One, of course, is that saying we're going to lose $10 billion over the course of the year, I think. But $10 billion loss of revenue because of Apple's privacy features. I want to dig into that a little bit because on the one hand,

100% Apple came gunned in for Facebook with these privacy changes and a lot of bad behavior across the industry. However, I wonder if blaming Apple isn't also cover for the fact that Facebook is running into all these other headwinds real hard and that the biggest problem for them is that negative user growth quarter over quarter.

You know, I think they built up such bad will. And I've been saying this from the beginning since I thought Zuckerberg was a bad actor because he kept stealing people's ideas. Yep. I think that bad karma has built up to the point which people don't want to work for the company. The fact that they, you know, all the election malfeasance and all that stuff, it's just all this bad will. Then, you know, subverting the research on women or young women with body issues and eating disorders. it's just like when all of this bad stuff builds and you don't take any responsibility

and you steal people's ideas, at a certain point people stop rooting for you and they want to see your demise. I think that that's part of this. And I think a lot of the people who are owning the shares are like, you know what? I have other places I could put my money and I don't want to believe that they can overcome these problems

because there is a chance they could overcome these problems. And Apple did the right thing for their users. Apple said, we want to be the privacy company. we are not going to let you track. That's well within Apple's right. And of course, that affects Google. It affects Snapchat, Twitter. It'll affect TikTok when they get their ad business government.

Everybody. Right. Everybody on the platform, right? It is affected the entire digital ad industry. Like every article in every digital ad publication right now, Trade Pub, is like, how do you work around this? And I'm sorry to say they're all pivoting to texting. So like lock that down immediately.

Yeah. And listen, at some point, somebody had to say, we need to protect the privacy of users and there's overreaching here. And let's give the users some power in this. And, you know, the governments, you know, they're trying and the EU has done some stuff. There's California regulations as a backstop, but that's pretty slow moving. And what you see here is another private company that owns a platform can press a button and can execute instantly. So again, it's a huge deal. It's a huge deal because Apple does make some money through advertising.

They have it in their, a de minimis amount in their app store, and they have the search deal with Google. So in fact, I'm guessing long term Apple's moves here could have costed some money on the margin with that Google deal, because when Google renegotiates that deal, maybe they make less money, yada, yada. But when you have a money printing machine, and this is when you talk about mob behavior, you know, to dovetel another story that's been in the news with people saying, you know, like all is fair. and love in business and war and platforms. This was the ultimate gangster move by Tim Cook. He had had enough of the bad behavior of app developers on their platform that they get blamed for. And he just pushed the button and nuked $10 billion in revenue for Facebook. These days, it can be hard to find and hire the right candidates for your small business.

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Terms and conditions do apply. This is one of the most hardcore hits I've ever seen in. business. I'm trying to think the only other thing I can think of is like Microsoft bundling internet explorer and, you know, killing Netscape, you know, so viciously. I mean, it is a murder. It really, it is just a, it's really bloody. And it is, you know. And I like it. I'm sorry. Well, look, it's good business for Apple. Like at the end of the day it is, and you are absolutely right to point out that Apple was taking the hit for, you know, I mean, I would imagine that this started brewing around the time of Cambridge Analytica. But there was no doubt.

that Facebook had been abusing access to Apple's consumers for years. Lots of companies had. And they finally just were like, you know what? We're seeing where the wind is going and we're seeing what consumers want. We're seeing potentially the end of targeted advertising as a business model. And, yeah, I mean, Tim Cook, I think, was like, yeah, I don't like him. This is the most Steve Jobs move. This is a tribute to Steve Jobs because this is the type of stuff that Steve Jobs would do.

Steve Jobs, when he had enough, he had enough. he had enough and he would take decisive action to stop bad actors, you know, whether it was taking an app out of the app store or, you know, platform wars, whatever it was, this is like 1984. You know, commercial. I wonder when you look at this, I mean, listen, like, the truth is that this is a big drop, right, for Facebook to lose, what was it, they lost a Shopify and Uber and a Coinbase from their market app. It's a significant.

Over one day, it's really significant. However, objectively, the company is still making a crap ton of money and did make a crap ton of money. Revenue was up 37% year over year. We were just gushing over Google being up 41, right? Yeah, on a bigger number. 39 billion dollars in profit, up 35% year over year. Facebook is now trading in about five and a half times revenue and 16.9.5 times profit. Some contrarians are saying this is now a value play.

But I wonder at the point at which you started a decline like this and the sentiment problem that you've identified is so strong, how much of this is, I mean, I asked, you know, when, when Francis Hogan came forward as a whistleblower and revealed all this internal data, all this stuff that Facebook had been covering up, then you have this sort of like drip, drip, drip of them constantly misreporting numbers, right? Like essentially telling, like building an entire pivot to video in the media world and then being like, oh yeah, turns out that was a house of cards. We were lying about those numbers all along.

and the regulatory issues. Like, is there a CEO in the world of another public company, let alone an entire leadership team that would still have their job? You know, he has the super voting shares. He is the company. You know, if he went away right now, you know, a CEO change, I think, would make the stock tank even more. Because at this point, the reason is, I think he is such a hardcore individual.

and they've already lost so much value that people want, you know, the guy who got his ass kicked in that seat. In other words, he's going to fight. And I think Zuckerberg has a certain determination to him. So I would not be surprised if, you know, he, this,

I don't think this will break him. I think this will strengthen his resolve. It's obviously not the end of Facebook. But it's the end of them buying big companies because of regulation. And when the state, stock goes down like this, if you join the company in the last year or two and your stock compensation was based on, you know, a share price that was higher, you know, this is the kind

of move that can cause a little bit of chaos inside the company. People are, you know, thought they were worth a million. Now they're worth $600,000, you know, worth $750,000 over the next two years. That was going to pay for their mortgage. It's going to get in people's heads. and he used to be able to buy people off with the stock price. And people silence, you know, the top employees, etc., you know, and Francis Howgan. Like, even those type of people used to get compensated so well that you would basically buy their complacency, I think. And, you know, this is going to be a very hard couple of years. I don't think it's going to get better in the next year or two.

I think there's a natural audience for a lot of these products, and they reach the natural audience in a lot of markets a while ago. And now there are more options coming, like TikTok, and they can't buy TikTok, right? So they used to be able to buy the Instagram, WhatsApp, and avoid this problem. Yeah, totally. Now I think is when we are going to find out, you know, because there is that mystique around Zuckerberg who has, or Cheryl Sandberg has, right, operated at an incredible level of execution for the last 15 years.

but I think now we find out if that mystique is is valid right because when you get into trouble not the kind of trouble where like a lot of people are mad at you and you can PR your way out of it but the 200 but the 220 billion dollar you know value loss kind of trouble that's when I guess now we find out you know Nikita buyer was tweeting about this who was a former Facebook employee summed up, you know, those big five headwinds, but then said, Zuck is the greatest operator in the world, and I wouldn't bet against him in the long term.

I would not bet against him either. Yeah. I do think that nobody wants the Metaverse. I'll be totally honest. And we've had this discussion. I do think the AR glasses are going to be kind of cool. But I think it's, we did an over under on this, where we thought, like, what would be the time period

where we'd be a daily use case? I think we said something like nine years or something. Yeah. the renaming of this company is going to be looked at like, didn't Netflix do a rename Quicky or something? What did they call their? Yeah, they were going to try it. And then they were like, never mind.

And it was like, uh, yeah, always a bad idea. So, and I don't, you know, I don't think VR is the win. We talked about that. And the AR is the win. So we'll see. But they're also on a collision course. So this Apple fight, I would say this is round one. And then round two is going to be the glasses, AR glasses coming.

So when Apple drops those, that could, let's say Apple's AR glasses are iPhones, essentially, and iPads. They're just so delightful that it's undeniable. It's the best product in the world. Okay, what's that going to do to the stock? Right. Okay, you bet the farm on the Metaverse. And you got your ass kicked again by Tim Cook and Apple. That's actually the probable outcome.

So then they're going to have been beaten down twice. I mean, then who really wants to own the stock? if it's like Apple owns you that badly. I know. Paul Graham had an interesting tweet. Time for Facebook to get to work on that phone, which is something Chamoth was working on when he was there. Humans like animals are most dangerous when threatened.

If I were Tim Cook, I'd have thought twice before threatening Zuck. YC's always been a little bit in Team Zuck camp, for whatever reason. Do we have, or did Facebook break out their numbers with respect to their hardware operation? Because you know they have that kind of,

Echo Show competitor, the little, the gadget that you're supposed to like use in your home. Yeah, not creepy at all. What do they call that? What was that? I know one person who bought it. The Muppets were, yeah, they had the Muppets doing commercials for it. Right. Like, I wonder.

Portal. Portal. Which, right, it had the creepiest name ever on top of. Zuckerberg in your house with a camera and microphone. Exactly what people don't want. Like, I sort of feel like, however many people bought Portal is however many. people might be willing to buy a Facebook phone, not inclusive of international markets. We shouldn't forget Facebook has huge growth overseas right now.

Its biggest growth there is are international. So maybe they come out with like a low price Facebook phone in some countries. But I also think that even internationally countries are waking up to the fact that they don't necessarily want Facebook in town, right? I mean, they had that Facebook basics service that was like essentially a net neutrality nightmare from the second they even proposed it. I was at that meeting at CES like five years ago where they were like, yeah, we're just going to go into developing countries and offer them free internet service ourselves. And we're going to choose all the websites that they have access to.

And I think India was the first to be like, no, thank you. Under no circumstances. I'm going to quickly explain one crucial type of insurance that all startups need, E&O insurance. That covers errors and omissions. And it helps you scale your business because any major customer is going to ask you, hey, Do you have E&O? You need to have E&O if we're going to close this deal. If you want us to sign on the dotted line and you want to get the DoReMe?

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twist, twist, twist, and broker.com slash twist. I'm just thinking through here, like, if they, if they had in the smartphone world 10 years ago when Chimov was there and he was supposedly working on the phone, and they had done, I thought it could have been powerful for them to buy a handset manufacturer like HTC maybe or somebody who was loved and was doing like interesting new hardware. Cool hardware, yeah. But now you look at the lead and the scale that Apple has.

even Google with an incredible product. You know, those pixels are just extraordinary. And I think they've been selling well. But even if he sold them at break-even, would people stop buying their iPhones? I don't think so. So it's not a lot of money that they're going to make from hardware. I don't know on this chessboard what Zuckerberg's best move is other than to say,

you can buy a subscription to Facebook, Instagram, WhatsApp, etc. off all advertising and tracking for six bucks a month, $49 a year, and you're going to get all these other features, including photo sharing, storage, whatever. And I think there's people who would like to have an ad-free experience on these sites. I would pay for it. Now, I know I'm in the, you know, slow single-digit minority here, but I think it would actually give them the air cover to say, listen, we have a free ad product. And for $4.95 a month, and $49 a year, you can have no ads in your feed and you get, you know, a very ad-free experience. And we understand some people prefer that, just like some people like HBO.

And some people like to not pay for TV and get free TV with ads on Hulu or whatever it is. I mean, it's the power move. It's probably the power move. It stops their developing nation growth or at least it's not going to be a huge growth area in developing countries. So, you know, if you think of that, so a move to a more premium product puts them is a power move against Apple, but it also, you know, right now, the thing that Facebook has that few other companies have is that it's a massive global free product. And so in terms of a massive growth move, probably not.

I think it would stop their regulatory issues, like the politician issues. It would stop that, but it wouldn't necessarily stop the, you know, daily active user issue because it's not going to move the needle on an operation that has, whatever it is, 200 billion, 2.8 billion people. using it, how many people are going to pay for that? Like 100 million? 150 million globally? Yeah, I mean, listen, it would be a small number of people.

That would be 10%, almost 10. If they have 3 billion people using their products, I think, cross-all products. So if they're 3 billion people, could it be 5%? No, maybe 2%. 60 million people. So I don't think it would be like this crazy revenue driver. It would be nice.

But it would also let them start every discussion. We understand there's a group of people who want to pay and there's a group of people who want free. And we offer both at the top of your feed. We have the thing here where we upsell people on subscribers and they can say, you know, yes, no, maybe. And here's the percentages. So now you understand what the world is, you know, wants. In our chat, by the way, 27 votes in so far. Producers wanted to know, would you buy a Facebook phone, something that is your main consumer internet device? Currently, that tally sits at 95% no.

95% now. 95% no. That's a reputation problem. Oh, look at. Thank you. Let's do the numbers on the business, the future business. Meta. Yes.

The reality labs segment of the business had the following numbers. I mean, listen, we've heard numbers like this before and it wasn't always a deal killer, but I'm just saying this is what they bet the new company on. $877 million of revenue in Q4 with a $3.3 billion net loss. Okay. So yeah, that means they're 3.3 times four is 13.2. So they've said they'll invest $10 billion a year. It's more. And currently they're losing more money than they've said they're going to invest.

So they're losing that and they're losing the $10 billion a year. So that's $24 billion a year in losses between the headwinds of the Apple privacy changes and this. It's just a lot of money going out the door. and yeah. I wonder if Apple, do you think Apple, because they were working on the AR headset and saw Facebook as their top competitors

were like, how else can we screw with Facebook? Yeah, let's take their core business, let's take their high margin business, and let's ankle that while we're going after their future. Very possibly. 100%. Like, I'm certain that development on Apple's glasses has accelerated since Facebook changed its name to meta and said that we're going to take.

Because honestly, I can even see Tim Cook philosophically being like there is no way in hell that we are letting this company basically own the next world. The next platform. The world. If Mark Zuckerberg's goal is for all of us to live in the metaverse like Reality Player One style, you know that Tim Cook from a business perspective and possibly a humanity perspective was like, no, no, no, no, no. We got to stop that in its tracks.

I think this is a net good. This is a net good for the world. I am thrilled to see this. I've never liked Zuckerberg. I think he's been bad for our industry. I think he pissed in the well and created so much the well that we all have to build companies from, which is consumer trust. And I've never liked the guy.

I think he's a bad actor. I think he's a bad human being. I think he treats people. poorly, other companies. And I'm glad to see his demise. I hope it continues. And I hope other companies now look at Facebook as a hobbled company and they don't sell their companies to Zuck. And I've been saying this for a decade. Never sell your company to Zuck. Keep building it. Go to venture capitalists, raise more money, compete with Zuck. This is not the person we want to have defining the future of humanity based on his track record, based on what he says and based on how

he views the world. He's got a weird worldview of how the world should work, and he should not have influence. The decline of his stock price is the decline of his influence is the decline of people wanting to work with him. And if you are a talented person, I implore you to go work on climate change, go to Tesla, or go work for a world positive company in some way, right? Any job but Facebook meta is a better job. This is the worst place you could go work if you're a talented person and if you are an entrepreneur, compete with them. Just keep hammering and competing against them.

And if you're talented, don't go work there. I cannot have a single thing to that, except for amen. Yeah. I mean, I just... I think there's one interesting angle that you didn't cover. So, regarding their hardware, I remember Zach Collius was on and he was talking

about how he got the Facebook portal and he said it was, I think he said it was better than any iPad he'd ever had. Facebook's reputation for privacy is so bad that nobody wants it anyway. So there's kind of an interesting take you could have where no matter how good their hardware is, it has to be 50% better than anything else anyway just to overcome how bad their reputation is. Yeah, I'm not in disagreement with you on that. I think we beat this one into the ground.

And I hope that they continue. And you know what? If you're working there, quit. Facebook into the ground. And just if you're working there, it's just not worth it. Like, when you go to your kid's soccer game, where you're at the dinner party. People are like, where do you work?

Like, I've been at these uncomfortable dinners. And I work in tech. I was at one. Totally. Where do you work? I work in social media in tech. Oh, what are you working on? I'm working on like, you know, augmented reality.

Oh, really? Where? In Silicon Valley. Oh, where in Silicon Valley? Yeah. You know, like in the Bay Area. No, no. What company are you working at Facebook?

It's basically like saying you work at a cigarette company. It's like you work at Jewel or you work in tobacco. We have a nice little chart here showing, by the way, that one of, I mean, to the point that Jamath made on All In, when the rot starts from begin, from inside and you can't hire. Look at this. The median tenure of employees at this point at Facebook appears to be about 1.8 years. Yeah. I mean, our industry does churn.

But yeah. It does. But no matter what you want to build, you can't build it if you're constantly training, if you're constantly rehiring, if you're constantly like having to, you know, re-download institutional knowledge into new drones. Like that, it turn is a problem for companies. It's time for another R-Crowd deal of the week. Right now, you can join our crowd's investment in HIL applied medical.

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Like, if I was inside, if like suddenly Zuck called me on the phone was like, Jake Hal, you're right, be my professional coach. And I, he's like, meet me, we'll go for a hike or something, go skiing or something.

I really wouldn't, I would be at a loss. I mean, the only thing I can think of is maybe breaking the company up, maybe spinning out what's at, spinning out Instagram, and seeing if, like,

they stand alone, if those management teams could then make something, better? I don't know. I think that they're all the founders of those companies are gone. Yeah. Maybe you think the back to the founders left too. That's a big deal.

Oh, this would be the power move. You give Instagram back to Kevin Sishroom. And you say, hey, we're going to spend it out making a public company. We'll give you 10% ownership in it over 10 years. You can vest. And you're the CEO. You know, what's interesting about Facebook employees right now, too, and this tells you, by the way, like,

nothing's ever going to happen. And the name change is a sign. Nothing's ever going to happen with Facebook, the blue F. Like, hardly anybody that you talk to who works at Facebook anymore works on that product. I mean, that's the product that Facebook does not care about. It brings in the money, but all they care about is using it to fund the other things. And so you meet a lot of Facebook people who are like, well, I don't work on that product. Right.

I work on this over here. I'm working on AI. Like, you know, sure, it sounds like a lot of people are in Metaverse and that's true, but most of them are working on machine learning and AI somehow within this company. and they're allowing themselves to dodge the cigarette selling part of the business, but also it shows you the level of investment they even have in, you know, the newsfeed. Like, they don't care. Funny joke.

Somebody just texted me or message me. I'd rather have Pornhub on my resume than META. It's like, Mom's like, oh, you got a new job? Yes, they got a new job, Bob. I left META to go work at Pornhub. I think a good career move. in fact. Good call, good call. You know what, you're a sex positive kid. Good for you. Good for you. Casey Neistadt, one of my favorites. Too much video in my IG feed. scrolling is stressful now.

I just want to look at pictures. If I want video, I will push the little video button. Video is different, not better. Give me back my grams, please. What do you think of that take, moment? I mean, that's the other thing, right, is that they're killing the products that they do own. I mean, did you read the amazing Bloomberg woman Sarah Friar, Sarah Friar, had that good book about Facebook and the Instagram acquisition and all of the ways that once Facebook bought it, they were trying to turn it into an ad machine. They were starving Instagram of the resources that it could have used, right? They didn't understand and embrace the creator part of that business early. Like, Facebook is in the process of very, and then it was like, then they had IGTV and literally every user was like, nope. And it's like, where'd that go?

Stories. They stole stories. They stole stories. Pretty effectively, I think. Has worked for sure, but they didn't steal TikTok, right? Like, it's sort of, and then now TikTok. Now there's shoehorning TikTok in. Right.

And I don't want that. TikTok is just, you know what happens with TikTok? It's like, I go on TikTok and then 30 minutes of my life are gone. And I can't remember one thing I watched. And I'm like, okay, that was a bad use of my time. I should go find a classic film or a book. or anything would be better content than what just happened, you know, to that 30 minutes of my life. That's true.

But it is crushing it. After an accidental hour on TikTok, which does happen. Fascist. Literally, we're confessing to being heroin addicts right now. Of the accidental hour. But the thing is, like, after I spend an accidental hour on TikTok, I feel happier. And this is because of my feed, right, which is all like howling huskies and cute animals. But, like, I feel happy.

Whereas when I look at Instagram, I feel sad. Like, I feel FOMO or everybody's got their perfect life or I feel like a failure somehow or I watch too many videos or there were too many freaking ads and I spent $100 and I'm mad about it. Whereas TikTok is a joyful experience. And that is a big problem for Facebook. It makes me feel bad. I just want to tell my contemporaries on Instagram, you know, in other words, men in their 40s and 50s, put your shirts back on. I mean, sorry. Just stop.

stop. This has to stop. Mine is like dwell and then somebody who's having a cute family vacation that I wish I was on and then an ad. And then it's like some other thing that makes me feel bad and then an ad. Right. Like there's so many freaking. And then a video that I don't want to click through and watch the rest of because it's on IGTV, which again, nope. No one wants that.

My Instagram is now my friends who are divorced doing yoga or kiteboarding. and then basically letting folks know they are now shooting themselves full of testosterone and H-G-H and they have more muscle and lower body fat than they did in their 20s. And I'm like, how'd that happen so fast? And they're like, I don't know.

And I just really worked hard. A ton of testosterone to my leg and like literally, just stop. I too follow Jeff Bezos. H. Oh! And that's just Bezos. I mean, what is going on with Bezos?

He's taking it way too. I don't want to body shame anybody. The guy looks. He has hugeorexia. He has a linebacker. He has hugeorexia. He literally looks like a linebacker. You don't gain like children.

Listen to my words. You don't gain muscle mass after 40. That is not happening naturally. I mean, you could gain five or 10 pounds. What's his routine? Like his lap pulldown has to be out of control. He is. He's all about TB 12.

He's on the Tom Brady plan. Yeah, right. He's doing resistance fans. What? No. Is Tom Brady the guy from the Patriots who cheated to win the Super Bowls? That's the guy who cheated to win the Super Bowls? I just did that on purchase.

RIP, your mentions, bro. I do it all the time. I do it all like, oh, the guy from the Patriots, right? The guy who cheated to win the Super Bowl so many times. And people are just saying, he didn't cheat. I'm like, no, if you deflate the balls, that's against the rules, right? That's cheating. Oh, my God.

Whatever he is doing. They caught him cheating, right? and they were taking the signals of the other people to cheat, right? My God. I brought my brother his book. That tweaks the guys from Boston so much. It's so great to do. All right.

Let's go on. Speaking of cheating. Yes, let's move on. Okay, there's an NFT site, non-ironically called Hitpeace. Wow. And it's been accused of selling, I kid you not,

artist songs without permission. According to the New York posted an interview with the Business Builders podcast, co-founder Ryan Felton, explained how Hip Piece worked. Hip Piece was built on Spotify's API, given them access to the catalog of music that's on Spotify, which is everything. The goal of Hitpeace was for users to show off that they had owned their

favorite songs. Artists got royalties from the initial auction, and when the NFT was traded, the article noted that Hitpeace didn't give any details on how these proceeds would be divided. The New York Post reported, quote, each NFT offering gave buyers ownership of a unique song recording. According to Hitpeace, people who purchased NFTs were also promised a company real-life perks, including access to experiences with artists. The band, The Human Fly, dove into Ryan Felton on Twitter. You can pick it up from here, Molly. Did a deep dive on the guy below writes this band's Twitter account,

somebody of the band, The Human Fly. Did a deep dive on the guy below, Ryan Felton, the co-founder of Hitpeace. I don't think we totally know what we're dealing with here, and I'm actually a little alarmed. First off, they point out, the guy is not a rando. he's a legitimate music industry player via LinkedIn. He ran the militia group, a Sony music acquisition for 12 years. He's also a former Billboard 30 under 30 exec,

but they go on to say this manifesto that he published on LinkedIn, which was titled How to Win the Music Industry of 2019 to 2025, is absolutely terrifying. They say a lot of it is tech jargon, but there are pieces that provide clues to where these folks' heads are at. And where these folks' heads are at is that in the future, AI will analyze songs to predetermine their quality, not to mention, evidently, they will just take them and sell them without permission as NFTs.

Okay. We're now in Crazy Land. I'm trying to, oh yeah, it's Rory Felton. Okay, just not Ryan. Oh, sorry, Rory Felton. He put an asterisk. Yeah. Which I think people do this if they don't want the person who is doing an ego search for

themselves or has an alert. to find out you're talking to them because people did that to me. They would say, apologies to Ryan. Rory Felton is the guy we mean. Well, anyway, no apologies to this guy because obviously from what we're looking at here,

he's a thief and lost his mind. This is a serious problem. I've had this happen a ton of times now where people are like, hey, I want to create NFTs for all in, for this week and startups, yada, and they're like, we're launching them tomorrow. Can we send you 10% of the proceeds?

I'm like, no. They're like, you don't want the proceeds? I'm like, no, I'm not giving you permission to do this. And they're like, why not? We're fans. And I'm like, okay. It's great that you're a fan. If you're a fan, buy the album, buy a ticket, buy a t-shirt from the merch store.

Great. Don't steal people's IP. Intellectual property. A meme is different. If you make a meme and you make a joke, that's different. If you make a business, where did the IP come from? And that's the difference here. And people are taking the behavior.

of fans like fan fiction or like, I don't know, I'm going to draw a picture of Bezos looking buff because I'm a Bezos fan and I want to have, you know, my own fan fiction of Jeff Bezos as the Rock or he's going to be the new lead in Fast and Furious 17. That's fine. You're not selling it. If you want to make a fan film about Darth Vader, you can actually do that if you don't make money because Star Wars has actually said we'll be okay with some fan films. You that's not this. That is not this. And that's not the pod clips thing I was talking about the other day where they were taking every Tim Ferriss episode, every this week and startup's episode, every all in terms of without permission and building a business on it. You have to ask first.

You can't ask after. You have to ask first. Yeah. Well, and this is, I mean, it's very interesting because what it appears to be happening is two separate things here. I mean, we had this conversation yesterday, right, about how sort of the aggregation model of the internet has led to this idea and frankly, when it gets combined with NFTs, has led to the idea that you can make yourself into a creator and then make money

off of anything, including stuff that other people have created. And that there's of course going to be plenty of scenarios in which that goes too far. This seems like maybe a double whammy where hit piece or as people in the comments on LinkedIn are calling it a obviously shit piece, has

used possibly machine learning and AI to pull in songs that it thinks are going to be a hit and then resell them as NFTs. And it almost feels like it's this automated process and then basically musicians

are discovering that the music has gone up on the site without their approval. I may have mischaracterized that, but that's my understanding of putting those two things together, the LinkedIn piece with what's actually happening here. Yeah. And they're not happy. Like, short version, they are. Also, I'll give you a little piece of advice.

If you're going to pick an industry or a person to steal from, the mob and the music industry, are going to be in the top, like, five of people you do not steal from. Kind of same, same. On the hit piece. Well, you said it, not me. Like, you don't steal from them. Also, Hollywood, don't steal movies from Hollywood. They have a lot of lawyers.

They live for this. And what they will do is they'll make an example out of you, which I hope they do here. I hope they sue this person and make an example of him and shut his company down. Because he needs to be some examples where, And listen, I'm a startup investor. But I guarantee you this person knows they're breaking the law. This is a person who's in the industry. You must make an example.

If you're in the industry, you know it, yeah. Yeah. And then there's another thing of making tools, by the way, I'll just finish with this. Yeah. If you make a tool that is designed explicitly to facilitate copyright infringement, you know, and it's not Canva, like, so sure, somebody on Canva could steal somebody's photo or somebody with, you know, I don't know, Adobe Premiere. You could steal people's movies and then edit them.

And, you know, like, those are generic tools that the primary use is not stealing. But here, the primary use of this tool, if it is, in fact, designed to pull from Spotify, where all the music is copyrighted, like, that's not the bastion of creative commons. Now, if you were pulling from the Creative Commons library and saying make an NFT, and it said, hey, you pulled from the no attribution section of Creative Commons, of Commons, here's what you have to do. Hey, you pulled from the attribution, make sure you put an attribution on it,

or we're going to do that for you. That would be thoughtful, right? Right, that would be fine. Public domain. Aggregated all. Yeah, there's literally a search engine of, um, creative, there's a creative common search engine. So if you want free content, start there and make NFTs from creative

common stuff. Yep. On the hippie's Twitter account, they responded to the allegations by saying, clearly we have struck a nerve. and are very eager to create the ideal experience for music fans. To be clear, artists get paid when digital goods are sold on hit piece. Like all beta products, we are continuing to listen to all user feedback and are committed to evolving the product to fit the needs of artists, labels, and fans alike.

Causing the son of Eddie Van Halen, Wolfgang Van Halen, to respond, ha ha ha ha ha ha ha ha ha. F*** you. Quote, Ha ha ha ha ha ha ha ha ha ha ha ha And F word And then he responded to himself by saying Ooh, you can also mint this interaction auction it

And then shove it up your asses You have my full permission He's definitely a Van Halen He's definitely a family line Great awesome That's the sound of a nerve Of a nerve being struck Here's a I mean

And then there are some other musicians Who are not going to respond to you on Twitter They're going to meet you outside your house with a pipe. Like, be careful, dude. What's that movie where they talk about the Vig? The movie about the music industry that's just like, don't touch the Vig or something.

I mean, it's just look up like mom, music industry, like crazy, you know, people with, I have a friend in the music industry who told me like, you know, somebody had sampled something and I'll abstract this so it's not identifiable. Anyway, somebody had, you know, basically showed up with their crew, with guns in their belts, walked into the musician.

This is like artists who, you know, some people listening would know, and this happened long ago, literally showed up, knocked on the door, the person opened the door to the recording studio, and they just bashed it in and showed up and literally pulled out a gun, pointed it at the artist, and said, sign this piece of paper. This is like crazy. You know, who knows if this is true or not, But this is somebody in the music industry who's in the know.

Well, I'm literally like, sign this. And the person literally signed it. Like, I would sign it. I don't know. And like, to this day, I think that that is a binding legal agreement. Wow. And that person was like, yeah, I don't feel the need to report this crime. Even like setting aside the guns and the mob behavior, look at how artists have had to fight for pennies since the, since music is right?

Because the music industry, the record. industry kept such a freaking stranglehold on CDs for so long that then when music really did start going digital, they weren't profiting. Then streaming came along and you would get like a million streams on YouTube for like a quarter of a penny. And then they had to fight so hard to get paid through Spotify at all. So musicians are out here finally figuring, they had to sell concert tickets for $300. Like musicians are out here finally figuring out how to make a living from the digital music economy for which I blame record labels and so do they, but still. And then along comes this freaking guy or NFTs or whatever, just being like,

we're just going to take it and turn it into a token. This apology was so terrible. Was it written in notes? This feels like one of those apologies that was written in notes and then screenshot. Is it a screenshot apology? Just it's a cut and paste apology, I think, for sure. Sure. Is it a new notes?

Yeah. Confirmation from the producers. It is a classic notes. If you're writing your apology, not on Twitter, natively or Instagram natively, but you're taking the time to do it in the notes app and edit it and share it with your crisis team.

Yeah, you did something really bad. That's when you know, when you're, that's when you're effed. You're seriously f*** when you're fracked when you're screenshoting notes. That's the point in life where you need to reflect. to Molly. And possibly change the name of your company. And maybe.

Good callback. Dr. Perg writes his apology to shareholders and to government officials in the Apple notes. In the Apple notes, totally. Oh, beautiful. All right, everybody. Let's get to our interview with Paige. Hey, everybody, welcome to Angel Season 6 episode number four. This is the season of the Angel Popper.

where we're talking to first-time fund managers. Yes, people who have raised their first fund and they're finding their way in the venture community and making those bets with the hope that you, if you're interested in either getting their money as a founder, can understand how they're placing their bets or perhaps you're thinking about raising your own fund. And you want to hear from somebody who's fresh in the game who's just closed their first fund. Really, great lineup so far. And today will be no difference. In our first episode, we had Mac the VC. Nice $10 tight fund. I see that he announced he's going to raise a $75 to $100 million fund now. He's with rare breed. David Rosenthal, a friend from Acquired the podcast. He is doing kindergarten VC. A nice

$3 million fund fund, his My First Fund trial, just to see if he could get it done. And he's done great with that. And then we had Pachy McCormick from Not Boring, a great email newsletter, content creator who is, let's face it, taking a playbook that some of you may have heard from podcast plus fund equals interesting. And today on the firm, I think the youngest venture capitalist we've ever had, Paige Van Dardy is from behind Genius Ventures. She just graduated in 20, wait for it, 20. And she has her own fun. Previously, she was an on-deck Angel Fellow in 2021. We'll hear about that. And she graduated from San Diego State in 2020, worked at TVC Capital, BCIC, and Northrop Grumman during college. She's the author of Seed to Harvest a Simple Explanation of Venture Capital,

published in May of 2021. It's a children's book, made to Demy Venture Capital, and she's got her own podcast called Seed to Harvest, and it's based on the book. Welcome to the program, Paige. How are you? Thank you so much for having me, Jason. It's an honor to be here. Oh, thank you for saying that. And congratulations on the success. When, I'm guessing, you're 22 or 23 years old, if I'm guessing 23. Let me ask this question. When did you first hear the term venture capital? How did you become exposed to this? And then we'll get into how you very quickly figured out how to start your own fund. Sure. The first time I heard venture capital was probably in 2018. I had been selected to compete on our school's first ever venture capital investment

competition team at San Diego State. I previously thought the venture capital was something that old dudes like sat around in mahogany library smoking cigars and picking companies. I just came from the mahogany library and I just put out my macanudo. I know. We're not in person so I can't smell the cigar. But I ended up binge watching Silicon Valley over my winter break of my junior year. and through seeing strong female characters in venture capital roles,

I started to understand that there was a place in this industry for folks who didn't come from generational wealth and had different backgrounds. And so started to build a playbook around what my role in venture might be, ended up taking second place to the reigning national champs, our first year with about two months of cramming. And I remember sitting in the partner meeting at Google, where we competed, being absolutely,

grilled by all these venture partners and loving it, there was a spark for me that I had never felt before and I just felt at home in that mock partner meeting. Yeah. So that's what sparked my interests originally. And now it's, it's fun. It's come full circle. Now I'm coaching the VCIC team at SDSU. So cool to get back in that way. That's amazing that your college actually had a venture capital club basically that competed. And what an amazing way to get exposed to all this. Now, you watch Silicon Valley one great. You binge watch it. Now, there are two very specific female venture capitalists on this show. One of them, I was told, is a little bit aspergery and was based on a hybrid of maybe Peter Thiel and Marissa Mayer. And Marissa, I don't think is Aspergerie, but they set a little

robotic. And then there was one who was a little more heartfelt and who was a little closer and who was the who was the junior to the senior female female. Which one did you identify with more? I think I resonated with both of them in certain circumstances. I think my journey being an empath and like, knows where do you say a lot in this industry, which is very difficult. I resonated a lot with the character journey of the second one. Yeah, the more junior one, who was the heartfelt one. You see her start very starry-eyed and super excited and you watch her learn more about how the venture ecosystem works and develop what I like to describe as the wet stone and like

basically sharpening your decision knife. I think that's been one of my biggest learnings becoming a fun manager is like how to make those sharp decisions. communicate them with warmth and warmth and empathy. So let's double click on that, sharpening the knife and making decisions. When you first started investing and making those decisions, what did you think was the proper framework to make a decision? And, you know, whatever, 12 months later, what have you learned?

And what do you think is the best practice? What is your methodology for picking a founder and a company to invest it? So there's a couple parts of that question. I'll start first on the question about developing an investment process. One of my mentors and investor in ARFA and Andy Wiseman told me during our first call that the investment process is just that a process. You're not going to know if you're good at it for another seven to 10 years. So you might as well chronicle the journey, do the best that you can, ask lots of questions from founders, operators, investors along the way. and try and hone into what your intuition is saying about the types of founders that you like to work with.

Venture can be done a thousand different ways, whether that's portfolio construction or thesis, and it's really about a process of self-discovery of what you want to invest in, the types of founders that you want to back. And so the first deal that I did was a company previously called Cardea, now called Palat, might have seen it on Twitter, their community-oriented job board platform. And when I met the founder, I was working at WorkWest,

which is the API first startup, had never made an investment, but I was introducing different investors and founders to each other. And I remember getting off the phone with him after our first conversation and just having such table-thumping enthusiasm and the idea he was building. I was like, I need to be involved. I want to be a part of what he's building.

And so I ended up asking for allocation and with no idea what I was going to do with that allocation. I woke up the next morning. I was like, okay, cool. So like got to find 50K somewhere. And I'm a recent college grad. I definitely don't have that. And so I ended up raising 50K from 17 investors for those of you familiar with SBVs. That's a lot of small checks.

Yes. And it's been really fun over the past year because a lot of those folks that invested in my first syndicate were first time angel investors, people like David Wong and Jamie Melser, and to see their journey as investors, has been really rewarding. But my first decision came from having that feeling of conviction in the founder, their team, the size of the market. It was a creator-oriented company, and so as a creator myself, I felt deep empathy with the problem that Kai was describing. So that's how my first decision was made. So let's step back for a second.

You decided you wanted to start a fund as opposed to go work for one, or did you consider, hey, maybe I'll apply since I won this competition and I'm enthusiastic about it. Maybe I'll go work for somebody or a firm and learn from them, as opposed to, say, the boldness of just starting your own fund. Yeah, I think about this theme of creative content. I was talking with Heather Honette at Human Ventures, who's one of our LPs, about the decision to start a fund versus join one. For me, one of those creative constraints was when I was a senior in college, I was exploring opportunities in venture, and I had gotten an offer from a firm in Boston to be their youngest partner track associate.

But when it came down to the day to make the decision, I was mulling it over, and I really wanted to stay in San Diego where my family is. and I remember just being like, all right, universe, if you want to give me a sign on what the correct decision is to make, I really appreciate it. And that next morning, Kobe Bryant died. And my entire timeline was flooded with like, you know, pick your own agenda and spend time with your family and think about your legacy. And for me, it was such an overwhelming sign that I should make the decision to stay with my family. that was February 6th, 2020. A month later, we were in lockdown. My senior year effectively came to an end and went online.

And I kind of tucked away that dream of working in venture. Got a great position, early stage startup, saw it from the inside. But in 2019, I can see this idea that in 10 years I wanted to run a fund. It just ended up happening on a shorter timeline. So let's get into that. You make this decision. Your heart tells you, I got to stay with my family. I got to make my own fund. How did you decide and who kind of taught you and how did you figure out how to start your own SPV and then start your own fund? And how did you find the first LP? Yeah. It's really funny because no one talks about it. This is like something I would Google and be like how to start on SPV. And there is all of these ClickBady SEO articles and that had no idea. no real insight into how they worked. And so I was going through my journey of creating SPV. Actually, my business partner, Josh Slysmann and I were introduced the same week that I gained

allocation into this deal. So I was drilling him with questions about the logistics of an SPV. At its core, an SPV or special purpose vehicle is a group of investors that you gather together and act as the pass-through vehicle to invest in a startup. What a common misconception is is that people need to have legal entities in place before they make the investment. In my experience, it's actually the other way around where you should have the commitments and allocation in more of a handshake form before you go through the process of legally forming a syndicate.

It is around $2,500, I believe. I went through Assure for forming my first SPV. And that's what we use. Yeah. And we're actually investors in the company. Yeah. So thank you for your patronage. Absolutely.

I'm big fans of Assure. I actually DMed Landon, who's the managing director of Fisher's syndicates. And I was like, hey, I got allocation in this deal, have no idea how to set up a syndicate, heard you were good at it. And he helped me through the whole process. So basically you're on Twitter. You're meeting people on Twitter. Yep.

You're sliding into their DMs and saying, how do I do this? Yes. And lo and behold, people wanted to help you. Yeah, it's amazing. That's how you met the, how to do an SPV. That's where you met the startup you wanted to invest in. And that's where you met your LPs. Yes.

And my business partner, we got introduced by someone that followed both of us on Twitter. See, this is the thing. People look at Twitter and they're like, well, Twitter's kind of a waste of time. And what you're telling me is you, built your entire professional network from zero to having your own fund at 20, you say you're 22 or 23. Yeah. 23 and you did the fund where you were 22. You went from like zero to hero like on Twitter. Definitely not there yet. But I mean, I would say raising your first fund is a very significant moment in time for anybody who wants to. There's plenty of people who've been working in venture capital for 20 years who haven't started their own fund. So you get that first SPV under your belt.

you start going to people and saying, I have an allocation. Would you like to put money in? Tell us about the first deal in terms of how many people, how much money, etc. Yeah. As I mentioned before, my first deal, I had 50K in allocation and I ended up having 17 folks invest. David Wong, who's the director of design at Webflow, ended up being one of the first folks to invest. We had previously been editing a lot of each other's writing. He was one of the largest I raised a GoFundMe to illustrate Seed to Harvest because I also was a broke college student at the time when I was writing it. And so that's how David and I originally met. I had no idea who he was and randomly donated $500 to this project.

And I was like, hey, what's up? We'd love to get to know you. Thanks so much for donating to this project. I really appreciate it and have built a friendship over the years. He sent me such an incredible card. last year and one of my favorite quotes from it was, thank you so much for setting my dreams into motion. And that for me has been one of the most rewarding parts of my journey

is I'm trying to write about how to set up an SPV. I'm writing, this is going to be a much longer article, but how to go about raising your first fund and things you should be aware of. And sharing that information so that one day other people's journeys can be shorter than mine was. I learned a lot. They could actually raise their first fund when they're a senior in high school.

I mean, it's really, there's really not much earlier you can go. No. I think, well, you know, it's interesting. It's kind of like a joke, but it's not. We started investing earlier and earlier in founders. And obviously, the people dropped out of college famously, Zuckerberg and Elizabeth Holmes and Bill Gates. Like, that was kind of a tradition. Like, yeah, if you're that good, quit in two or three of those cases.

And then before that, then we started to see high school students start companies. And we had a situation where we had a high school, we accepted somebody into our accelerator. And one of them was 16 years old. And we're like, do we need to get a permission slip for this? Do you have classes? And we like literally had to double click on that and figure out, hey, is this copacetic? Yeah. Yeah, and it was copacetic.

So you then decide you're going to start your own fund. And how does that come about? You were talking to her sure about funds or Angelist or quarter or something. And they said, hey, you know, you could start your own fund or you just decided I should have a fund to invest out of so I don't have to fire up at SPV every time. Yeah. So the joke is on me because one of the running motivations for starting a fund is doing less paperwork. But now putting together taxes for 120 investors. Yeah.

I'm definitely not doing less paperwork. Admin in venture and back office is like 10 years ago, it was incredibly arduous. It's become a lot better because of Carta, Assure, and Angelist and other services, but it's still intense. 100%. So to give a quick bit of context, one of my other creative constraints was I wasn't an accredited investor. And so that meant that I couldn't raise on Angel's, which was a bit, for a bit, for frustrating. And to explain to people, an accredited investor is somebody who makes $200,000 a year at school, and you were a person who had internships, but never a job. I was working full-time at

Work West, but I definitely wasn't over that line yet. Got it. And I actually think that has to be your last two years of income. Yeah, it has to be last two years. But the thing is, you can organize a syndicate and raise a fund without being an accredited investor. And I think that's something that a lot of people don't know is you can be the connecting node. you just can't invest directly. It has to be like through the entity that you set up that is a partnership. So that's a, that's a fun fact for anyone listening that is wondering about.

It is fascinating. When you think about it, you're not qualified according to these regulations, which are evolving in fairness. And people know they need to change and that's in process. But you're not in theoretically. A person is not good enough to invest in a company, but they can help other people invest in companies.

Yes. This is strange. Yeah. It's really weird. It's, there's this element, there's a theme that I call the trust coefficient and I feel like that's a big part of it is having accredited investors to trust your decision making skills. So the genesis of the fun really was me meeting, uh, my co-founder at behind genius ventures, Josh through the process of doing my SPV, ended up deploying personally around 300k and early stage syndicate deals over the course of three months. And that, point I was working full-time at request. I was doing this on nights and weekends. I was writing a

book. It was getting a bit overwhelming. And then I was like, you know, it'd be great. Just a point on the side. Did your boss know you were doing this on the side? Or you're doing this on the side? Okay, so you cleared it with him. I told him when I signed my offer, I was like, hey, just let you know, I'm going to raise a venture fund in the future. And that's probably going to be my next path. I don't think that he was expecting it to be six months after. I started, but that's how the cookie crumpled. So I met Josh, and he was really close with two folks that were very instrumental in our fund. So Arjun Sethia Tribe Capital and Smeet Gauh, who's the ex-DSO of Carda. And so... And Arjun had previously worked at Social Capital

with Chema. Yes, exactly. Actually, we invested in a founder who's ex-social capital, Justin Arctype, really enjoyed working with him. He said great things. about his time there. So Josh had had this interest, and he was a bit on the fence about pursuing it full-time and was just kind of thinking through that. And when we had met, it was funny, we had both told our friends when we got off the first call that we had, I have this intuitive feeling that I'm supposed to work with this person, and neither of us could place it.

And so we ended up meeting in halfway between San Diego and L.A. where we each live in Laguna Beach. And this was peak COVID in December 2020 time frame. So we sat six feet apart outside with masks on, notebooks out, and just running through what would it look like to build a venture firm of our dreams. And that was the genesis of Behind Genius Ventures. From there, we started fundraising in March and just wrapped up. up. So it took us about nine months, start to finish, ended up raising $5 million and $0.17. We were oversubscribed by $0.11. Thank you. And one of the interesting things is we were actively deploying as we were fundraising. So that was quite a time of actively deploying, fundraising, working full-time and publishing a book. And I just started working full-time on BindGenus in July of last year. So it's been quite a ride. And the book, I think, probably showed people that you're creating stuff in the world

and you're passionate. That must have kept coming up when you talk to LPs, right? Like, oh, what a clever idea. Yeah. Talk about this concept of, instead of talking about doing stuff, you just had the chutzpah, the gall, you know, the drive to actually do stuff in the world and how that changed how people looked at you over time. For people who are listening to this saying, well, maybe I just need to get somebody to give me permission or maybe I need somebody

to give me money to do something. Explain to them this different mindset that you obviously figured out very early in your life. Absolutely. I would say one of the words that defines me is I just have the audacity sometimes. Like I had no right to do what I did. I was just like, I agree. No one's telling me no, so I'm just going to do it and see what happens. And that was such a big part of my journey so far. Where did that come from? Is that like someone of your childhood?

Is your dad or mom a rebel? Did you have a friend in high school? We just did whatever they wanted. And you were like, that seems like a good plan. I was like the most straight, the most straight-laced kid. I might say that it comes from my love of books. I've read at least a thousand books.

Oh, wow. You used to come home from the library with like 20 of them, and so I feel like I've lived a thousand lifetimes through what I've learned there. And there was a couple of books that were really instrumental in my framework of how I think about the world. So one is mastery by Robert Green. In that book, he talks about these phases of your life where you go through kind of like the new phase, the creative, active phase, and then the mastery phase, that made me have a lot more patience. with what I was doing and appreciate

that I'm going to stuck at a lot of things when I get started, but if I just take the first step and continue, you talk about this lot with content of just consistently doing it over and over again. And just talking to people, I would cold email artists. So I wanted to manage rappers originally,

but financially venture made a lot more sense. Yeah, a little, yeah, I think a little less, Because you're working with people of large creative visions and building businesses and strategizing around media and messaging strategies. So it is relatively similar. But through my conversations with other people, the ones that were in positions that I, A, admired and B, really enjoyed what they did all had this common thread of asking for what they wanted, even if other people thought it was, you know, kind of shameless of them to do that. you'd be surprised. The worst thing someone can say is no, and there's often a lot of times people will surprise you.

This is a reoccurring theme of this season, because Mac from Rare Breed, if you listen to the first episode, anybody out there, you did. Okay, he just was talking about how many meetings he did, and he did like a thousand meetings, and he just kept asking people, hey, support me, hey, support me, hey, support me.

And if you get comfortable with getting a lot of nose, you need but one yes to get the ball rolling. And once you get one LP and you're like, yeah, you know, I'm talking to these 30 people. And talking to those people couldn't mean they said, no, by the way. It's not intellectually incorrect to say I'm talking to these people even though they're not investors. And you landed one or two. All of a sudden, now people are going to take the meeting, right? And you kind of build on previous success.

What are the books? I'm fascinated by this thousand book idea. Yeah. other books or autobiographies or other genres, that kind of mind-virused you into thinking, well, screw it. I'm just going to go my own path. This is something I've been thinking about a lot. I feel when I...