The following is a conversation with your mouth while have piteå a venture capitalist and engineer founder and CEO of Social Capital previously, an early, senior executive at Facebook and is the co-host of the all in podcast podcast that I highly recommend for the wisdom and the camaraderie of the four co-hosts also known as besties.
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You grew up in a dysfunctional household on welfare. You've talked about this before War for you personally. Psychologically, some difficult moments in childhood. I'll answer that question in a slightly different way, which is that, I think when you grow up in a household that's defined by physical abuse and psychological abuse,
You're hyper Vigilant all the time
and so it's actually easier for me to point to moments where I was happy or I felt Compassion or I felt safe otherwise, every moment I'll give you a couple of examples like you know, I was thinking about this a while ago.
There was a tree outside of my apartment where we lived when I was growing
up
and my father was sometimes would make me go outside to take the tree branch that he would hit me with. And so you can imagine if you're at an 11 year old kid and you have to deal with that. What do you do? Well, a hyper-vigilant child learns, how to basically estimate the strength of these branches, right? How far can he go before?
Before it breaks, you have to estimate his anger and estimate the effective strength of, you know, branches and bring back something because, you know, the I remember these moments where if it was, he would look at it and then he would make me go out again and get it right. Get a different one or, you know, there is a certain belt that he wore that had this kind of belt buckle that stuck out.
And you just wanted to make sure if that if that was the thing that you were going to get hit by that, it wasn't the Buckle facing out because that really hurt. And so you became hyper aware of which part of the Buckle was facing out versus facing in in those moments. And there are like hundreds of these little examples which essentially I would I would say the through line is that you're just so on edge writing. You walk into this house and you're just basically trying to
Get to the point where you leave the house and so, in that microcosm of growing up, any moment, that's not like, that is seared in my memory in a way that I just can't describe to a person. I'll give you an example. I volunteered when I was in grade five or six, I've can't remember, which it was in the kindergarten of my school and I would just go and the teacher would, you know, ask you to clean things up?
and at the end of that grade 5 year,
she took me into other kids to Dairy
Queen
and I'd never been. I've never had never gone to a
restaurant literally because we just we didn't have the money
and I remember the first time I tasted this you know this Dairy Queen meal. It was like a hamburger fries, a Coke and a blizzard. And I was like what is this? And I felt
So special. You know because you're getting something that most people would take for granted. It's a Sunday or it's, you know, or I'm really busy. Let me go take my kid to to fast food. I think that, you know, until I left High School.
I think I need this is not just specific to me, but a lot of other people, it's your in this hyper Vigilant Loop punctuated with these incredibly visceral moments of compassion by other people. You know, a different example, we had such a strict budget and we didn't have a car and so, you know, I was responsible with my mom to always go shopping and so I learned very early on how to, you know, look for
Coupons how to buy things that were on sale or special and we had a very basic diet because you have to budget
this thing really precisely,
but the end of every year where I lived there was a large grocery chain called Loblaws and Loblaws would discount.
A cheesecake from 799 2499 and my parents would buy that once a year and we probably did that six or seven times and you can't imagine how special we felt myself. My two sisters. We
would sit there, we would watch the, you know, the New
Year's Eve celebration on TV. We would cut this cheesecake
into you know, five
pieces. It felt like everything.
So that's sort of how, you know, my, my existence when I was at that age is For Better or For Worse. That's how I remember it.
The hyper-vigilance loop. Is that still with you today? What are The Echoes of that still do today? The good and the
bad, if you put yourself.
In the mind of a young child.
The thing that that does to you is that a very core basic level? It says you're worthless, right? Because if you can step outside of that and you think about any child in the world, they don't deserve to go through that.
And at some point, by the way, I should tell you, like, I don't blame my parents anymore. It was a process to get there, but I feel like they did the best they could, and they suffered their own issues and enormous pressures and stresses. And so, you know, I've really for the most part, forgiven
them, how do you jewe? Sorry to interrupt, let go of that blame.
That was a really long process where for I would say the first 35 years of my life.
I compartmentalize and I avoided all of those memories and I sought external, validation by going back to this self-worth idea if you're taught as a child, that you're worthless. Because why would somebody do these things to you? It's not because you're worth something. You think to yourself, very viscerally? You're worth nothing. And so then you go out and you seek external validation. Maybe you try to go and get into a great College. You try to get a good job. You
Make a lot of money you try to, you know, demonstrate in superficial ways with the car you drive or the clothes, you wear that you deserve people to care about you to try to make up for that really deep hole. But at some point, you'd it doesn't get filled in and so you have a choice. And so, for me, what happened was in the course of a six-month period, I lost my best friend and I lost my father, and it was really like the dam broke loose.
Because I, the compartmentalization stopped working because the reminder of why I was compartmentalizing was
God
and so I had to go through this period of disharmony to really understand.
And Steel, Man, his perspective.
And can you imagine trying to do that to go through all of the things where you have to? Now, look at it, from his perspective and find compassion and empathy for what he went through. And then I shift, you know, the focus to my mom and I said, well, you were not the victim, actually, you were somewhat complicit as well because you were of sound, mind and body, and you were in the room when it happened. So then I had to go through that process with her and steal.
And her perspective at the end of it, I never Justified what they did, but I've been able to forgive what they did. I think they did the best they could. And at the end of the day they did the most important thing which is they gave me and my sisters are shot by emigrating by giving up everything by staying in Canada and doing whatever it took between the two of them to sort of claw and scrape together, enough money to live. So,
That my sisters and I could have a shot and I'm very thankful for them. Could they have done better obviously? But I'm okay with what is taking place, but it's been a long process of that steel Manning so that you can develop some empathy and compassion and forgive,
do you think if you talk to your dad,
Shortly after he died, and you went through that process or today, you'll be able to have the same strength to forgive them.
I think it would be a very complicated journey. I think I have learned to be incredibly open about what has happened and all of the mistakes I've made.
I think it's it would require him to be pretty radically honest about confirming what I think he went through because otherwise, it just wouldn't work. Otherwise, I would say, let's keep things where they are which is I did the work you know with people that have helped me obviously. But you know it's better for him to just you know, kind of hopefully he's looking from someplace and he's thinking it was worth it. I think.
He deserves to think that all of this because, you know, I think the Immigrant challenge, we're not even the Immigrant challenge, the lower middle class challenge, anybody who really wants better for their kids and doesn't have a good tool kit to give it to them.
Some of them just they choke up on the bat, they just get. So agitated about this idea that all this sacrifice will not be worth it. That it spills out in really unproductive ways and I would put him in that category
and there are self-evaluation introspection. They have Colonel Vision so they're not able to often see the damage that did we have I know like yourself a few successful people.
That had very difficult relationships with their dad and you take the perspective of the dad, they're completely in denial about any of it. So if you actually have a conversation there would not be a deep honesty there and that I think that's maybe in part the way of
life. Yeah. And you know I remember pretty distinctly after I left and in this, you know, in my middle 30s where you know, by all measure I had
Roughly become reasonably
successful.
And my dad didn't particularly care about that, which was so odd because I had to confront the fact that, you know, whether it was a title or money or press clippings. You never really cared. He moved on to a different set of goals which was more about
my character and
you know being a good person to my family and really preparing me to lead our family when he wasn't there and that bothered me because I thought I thought I got to the finish line and I thought
Is going to be a
metal, you know, meaning like I can tell you, Lex, you know, he never told me that he loved me. I'm not sure if that's normal or not, it was my normality and I thought there's going to be something some gold star which never appeared. And so that's like a hard thing to kind of confront because you're like well now what is this? What is this all about? Was this all just kind of a ruse but then I realized well, hold on a second, there were these moments.
We're in his way again, putting yourself in his shoes. I think he was trying to say, he was sorry. He would hold my hand, you know, he would interlock the fingers, which I felt is, that's a really intimate way of holding somebody's hand I think. So I remember those things. So you know these are the things that are just etched in at least in my mind and at the end of it, you know I think I've done a decent job in repairing my relationship with him even though, you know,
No, it was posthumous. It does make me wonder in which way you and I are, we might be broken and not see it and might be hurting others and not see it. Well, I think that when you grow up in those kinds of environments and they're all different kinds of this kind of dysfunction. But if what you get from that is that you're not worth while you're not, you're less than many, many other people.
When you enter adulthood or you know, Sammy adulthood in your early 20s, you will be in a cycle where you are hurting other people, you may not know it. Hopefully you find somebody who holds you accountable and tells you and loves you enough through that.
But you are going to take all of that disharmony in your childhood and you're going to inject that disharmony into whether it's your professional relationships, or your personal relationships were both until you get to some form of rock bottom. And you start to repair and I think there's a lot of people that resonate with that because they have each suffered their own things. That at some point in their lives, have told them that there are less than and, and then they go and
Pope and when you cope eventually those coping mechanisms escalate. And at some point, it'll be unhealthy either for you. But oftentimes, it's for the people around you. Well, from those humble beginnings, you are now a billionaire. How is money changed your life, or maybe the landscape of experience in your life?
Doesn't buy happiness, it doesn't buy happiness, but it buys you a level of comfort for you to really amplify What happiness is. I kind of think about it in the following way, let's just say that there's a hundred things on the table and the table says, find happiness here and there are different prices.
The way that the world works is that many of these experiences are cordoned off, little bit behind the Velvet Rope where you think that there's more happiness as the prices of things escalate, right? If you live in an apartment, you admire, the person with the house. If you live in a house you admire the person with the bigger house that person admires the person with, you know, an island, right?
Some person drives their car, admires a person who flies who admires a person who flies business class, who admires a person who flies first, you know, to private. There's all of these escalations on this table.
and most people get to the first five or six,
And so they just naturally assumed that items. You know, 7 through 100 is really where happiness is found and the just to, you know, tell you the the Finish Line I've tried a hundred and back and I've tried to warn hundred to it and happiness isn't there, but it does give you a level of comfort. I read a study and I don't know if it's true or not but it said that the absolute
it sort of like maximal link between money and happiness is around 50 million dollars and there is a it was just like a social studies kind of thing that I think one of the ivy League's put out and underneath it the way that they explained, it was because you could have a home, you could have all kinds of the Creature Comforts, you could take care of your family and then you are left to ponder. What it is that you really want. I think the challenge for most people is to
why's that this escalating arms race of, you know, more things will solve your problems is not true, more, and better is not the solution. It's this idea that
You are on a very precise Journey, that's unique to yourself. You are playing a game of which only you are the player.
Everybody else is an interloper and you have a responsibility designed the gameplay.
And I think a lot of people don't realize that because if they did, I think they would make a lot of different decisions about how they live their
life
and I still do the same thing. I mean revert.
To basically running around asking other people. What will make you like me more, you know, what will make me more popular in your eyes and I try to do it, and it never works. It is just a complete dead end,
is their negative aspects to money. Like, for example, it becoming harder to find people, you can trust,
I think the most negative aspect is that it amplifies, a 360-degree view of your personality
Because there are a lot of people and Society tells you that more money is actually better. You are a better person somehow and you are factually more worthwhile than some other people that have less money. That's also a lie. But when you're given that kind of attention, it's very easy for you to become a caricature of yourself. That's probably the single worst thing that happens to you, but I say the opposite. I think all I've ever seen in Silicon Valley as an
Sample, is that when somebody gets a hold of a lot of money, it tends to cause them to become exactly who they were meant to be there, either a kind person, they're either a curious person, they're either a jerk, you know, they're either cheap and they can use all kinds of masks. But now that there's no expectations and Society gives you a get-out-of-jail-free card, you start to behave the way that's most comfortable to you. So you see somebody's innate personality
and that's really interesting thing to observe because then you can very quickly bucket sort where do you want to spend time? And who is really, you know, additive to your gameplay and who is really a negative detractor to your gameplay.
You're an investor but you're also kind of philosopher, you analyze the world and all its different perspectives on all in podcast on Twitter everywhere. Do you worry that money makes put
Got a touch from being able to truly empathize with the experience of the general population which in part. First of all on a human level that could be limiting but also as an analyst of human civilization, that could be limiting.
I think it definitely can for a lot of people because it's just a, it's an abstraction for you to stop caring, right? I also think the other thing is that, you can very quickly, especially in today's world become the scapegoat just to use a Gerard Ian, like, Rene Girard. If you look, if you think about, like, mimetic theory in a nutshell, you know, we're all competing for these very scarce resources that we are told is worthwhile. And if you view
You the world through that Girardi and lens. What are we really doing? We are all fighting for scarce resources, whether that's Twitter, followers money, a claim notoriety, and we all compete with each other and in that competition, you know, Gerard rights. Like the only way you escape that Loop is by scapegoating something or somebody. And I think we are in that Loop right now. We're just the fact of being successful is a thing that
One should scapegoat to end all of this, you know, tension that we have in the world. I think that it's a little misguided because I don't think it solves the fundamental problem and we can talk about what the solution to some of these problems are. But that's I think the loop that we're all living and so, if you become a character caricature and you feed yourself into it, I mean, you're not doing anything to really Advance
things. Your nickname is the dictator. How did you get the nickname?
We're talking about the corrupting nature of money
that came from poker in a poker game. You know, when you sit down, it's chaos, especially like, in our home game, there's a ton of big egos. There's people always watching, you know, rail birding, the game, all kinds of interesting folks and in that somebody needs to establish hygiene and rules. And I really care about the Integrity of the game and it would just require somebody to just say, okay enough.
And so and then people were just like, okay, stop dictating and that's where that's where that dick.
So who to you speaking of which is the greatest poker player of all time and why is it Phil Hellmuth exactly?
You know mute probably knew this question was coming. Yeah here's what I'll say I think Hellmuth is the antidote to computers more than any other player playing today and when you see him in a heads-up situation, so I think like he's played nine or
Heads up tournaments in a row and he's played like basically call it 10 of the top 20 people so far and he's beaten all. But one of them,
when you're playing heads up, you know, One V one that is the most
GTO understandable spot. Meaning, Game Theory optimal position. That's where computers can give you an enormous Edge. The minute, you add, even a third player, the value of computers, and the value of their recommendations basically falls off a cliff, okay? So one way to think about it is Hellmuth, is forced to play against people that are essentially trained like a eyes and so, to be able to beat, you know, eight out of nine of them means that you are
Playing sort orthogonally to what is considered Game Theory optimal and your overlaying human reasoning? The judgment to say well in this spot I should do X but I'm going to do why it's not dissimilar in chest like what makes you know, Magnus Carlsen. So good. You know, sometimes he takes these weird lines, he'll sacrifice positions, you know, he'll over play certain positions were certain, you know, Bishops versus nights and all of these spots that are very confusing.
And what it does is it throws people off their game. I think he just want a recent online tournament. And it's like by move six, there is no GTO.
Move for his opponent to make. Because it's like out of the rule book, maybe he read some game, you know, I read the quote. It was like, he probably read some game in some bar, in Russia, 1954 memorized it. And all of a sudden by six moves in the computer, AI is worthless. So that's what makes Hellmuth great. The there is one person that I think
is superior
and I think it's what Daniel also said. And I would Echo that because I played Phil as well, but Phil Ivey is
The most well-rounded.
Cold-blooded bloodthirsty animal. He is, he's just and he sees into your soul Lux in a way where you're just like, oh my God. Stop looking at me.
Have you ever played him? Yeah, yeah, we played. We played
and, you know, he crushes, the games crushes. The games.
So what is feeling crushed mean, and feel like in poker, is it like that? You just can't read at all? You being constantly pressured, you feel off balance. You try to Bluff.
And the person reads you perfectly that kind of stuff. It's a, this is a really, really
excellent question because I think this has paralyzed a bunch of other things. Okay, let's just use poker as a microcosm to explain a bunch of other systems or games. Maybe it's running a company or investing. Okay. So let's use those three examples but we use poker to explain it. What is success look like while success? Looks like you have positive expected value, right? In poker.
Her the simple way to summarize that is your opponent. Let's just say you and I are playing or going to make a bunch of mistakes. There's a bunch of it that's going to be absolutely perfect. And then there's a few spots where you make mistakes and then there's a bunch of places in the poker game where I play perfectly and I make a few mistakes.
Basically your mistakes - my mistakes is The Edge, right? That's that's pure, that's how poker works if I make fewer mistakes than you make. I will make money and I will win. That is the objective of the game translate that into business. You're running a company, you have a team of employees, you have a pool of human capital that's capable of being productive in the world and creating something, but you are going to make mistakes.
In making that maybe it doesn't completely fit the market, maybe it's mispriced. Maybe it actually doesn't require all of the people that you need. So, the margins are wrong.
And then there's the competitive set of all the other Alternatives that customer has.
Their mistakes - your mistakes is the expected value of Google. Facebook Apple, Etc. Okay. Now take investing every time you buy something, somebody else on the other side is selling it to you.
Is that their mistake? We don't know yet but their mistakes - your mistakes is how you make a lot of money over long periods of time as an investor. Somebody sold you Google at $40 chair you bought it and you kept it huge mistake on their part minimum mistakes. On your part, the difference of that is the money that you made, so life can be summarized in many ways in that way. So the question is, what can you do about other people's mistakes? And the answer is no.
Thing. That is somebody else's game. You can try to influence them, you could try to subvert them, maybe you plant a spy inside of that other person's company to sabotage them. I guess there are things at the edges that you can do. But my firm belief is that life success really boils down to how do you control your mistakes? Now this is a bit counterintuitive, the way you control your mistakes is by making a lot of mistakes.
So taking risks
Used to is somehow you have to be to minimize the number of
mistake. Let's just say, you want to find love. Yeah, you know, you want to find some go on deeply
connected with. Yeah.
Are you do you do that by not going out on dates and yes, sorry. Sorry, it's the only person. That's exactly. Yes, I'm joking. I'm joking. Yeah, but he's what I mean, like, you have to date people, you have to open yourself up. You have to be authentic and like you put you give yourself a chance.
Us to get hurt. Yes, but you're a good person. So, you know, what happens when you get hurt that is actually their mistake. Okay. And if you are inauthentic, that's your mistake. That's a controllable thing in you. You can tell them the truth who you are and say, Here's my pluses and minuses, my point is there are very few things in life that you can't break down. I think into that, very simple idea.
And in terms of your mistakes, Society tells you don't make them because we will judge you and we will look down on you. And I think the really successful people realize that actually, no, it's the cycle time of mistakes that gets you to success because your error rate, will diminish the more mistakes that you make You, observe them. You figure out where it's coming from. Is it a psychological thing? Is it a, you know, cognitive thing and then you fix it?
So the implied thing there is that there is in business and investing in poker and dating and life is that there's this platonic GTO Game Theory, optimal thing out there. And so when you say mistakes, you're always comparing to that optimal path. You could have
taken. I think slightly different. I would say mistake is maybe a bad proxy but it's the best proxy I have for learning. But I'm using the language of what Society tells you
Sure. Got
it Society tells you that when you try something and it doesn't work, it's a mistake. So I just use that word because it's the word that resonates most with most people got it. The real thing that it is, is
learning. Yeah. It's like a neural networks is loss of neural network effect. Exactly. Yeah. Right. So using the mistake, that's as most the word that is most understandable, especially, by the way, people experience it. I guess, most of life is a sequence of mistakes, the
Um, is when you use the word mistake and you think about mistakes, it actually has a counterproductive effect of you becoming conservative in just a bit being risk. Averse. So, that's if you folks, if you read, if you flip it and say, try to maximize the number of successes, somehow, that leads you to take more risk. Mistake scares
people.
I think mistakes scare people because Society likes.
These very simplified boundaries of who is winning, and who is losing, and they want to reward people who make traditional choices.
And succeed. But the thing is what's so
corrosive about that is that they're actually not even being put in a position to actually make a quote, unquote mistaken fail. So I'll give you a if you look at like getting into an elite school, right? Society rewards, you for being in the ivy League's in a way that you know in my opinion incorrectly doesn't reward you for being in a non Ivy League school.
There's a certain level of status and presumption of intellect and capability that comes with being there. But that system doesn't really have a counterfactual because it's not as if you both go to MIT and Ohio State and then we can see two versions of Lex Friedman so that we can figure out that The Jig Is up and there was no difference, right? And so instead it reinforces this idea that there is no truth-seeking function, there is no way to actually
Make this thing whole and so it tells you you have to get in here. And if you don't your life is over, you've made a huge mistake, you know, or you failed completely. And so you have to find different unique ways of dismantling. This this is why, you know, part of what I've realized. Where I got very lucky is I had no friends in high school. I had a few cohort of acquaintances.
But part of being so hyper Vigilant when I grew up was, I was so ashamed of that world that I had to live in. I didn't want to bring anyone into it. I could not see myself that anybody would accept me, but the thing with that is that I had no definition of what expectations should be. So they were not Guided by the people around me and so I would escape to Define my
expectations, the interesting. But you didn't feel
Like your dad didn't put you in a prison of expectation or we there's like that's if you have friend like that. So the flip side of that you don't have any other signals. It's very easy to believe like you when you're in a cult that.
Well he, you know, he was angry, he pushed me, he used me as a mechanism to alleviate his own frustration and this may sound very crazy, but he also believed in me
And so, that's what created, this weird, Duality where you were just, I was always
confused. They, you could be somebody great. He believed that you could be, he did. I didn't truly special him
because I couldn't reconcile then the other half of the day, you know, those behaviors.
But what it allowed me to do, was I escaped in my mind and I found these archetypes around me that were savior's to me. So, you know, I grew up in Ottawa, Ontario, Canada. I grew up right at the point where the Telecom boom was happening companies like Nortel and Newbridge networks and my tell, Belle, Northern research. These were all built in in the suburbs of
Ottawa.
And so there were these larger-than-life figures entrepreneurs Terry Matthews, Michael Copeland. And so I thought I'm going to be like them. I would read Forbes Magazine. I would read Fortune Magazine. I would look at the rich people on that list and say I would be like them. Not knowing that, maybe that's not who you wanted to be, but it was a lifeline and it kept my mind relatively whole, because I could direct my ambition in a Direction.
And so why that's so important? Just circling back to. This is I didn't have a group of friends who were like, I'm going to go to Community College, you know, I don't have a group of friends that said, well, you know, the goal is just to go to university, get a simple job and like, you know, join the public service, have a good life and so because I had no expectations and I was so afraid to venture out of my own house. I never saw what middle-class life was like and so I never aspired to it. Now, if I was close to it, I probably would have aspired to it because I my parents.
It's in their best year, made 32,000 Canadian together.
And if you try to raise a family of five people on thirty two thousand dollars, it's a complicated job. And most of the time they were probably making 20 something thousand and I was working since I was 14. So I knew that our station in life was not the destination. We had to get out but because I didn't have an obvious place. It's not like I had a best friend, whose house I was going to, and I saw some normal functional home. If I had had that in this weird way, I would have aspired to that.
What was the worst job you have to do the best job?
But the worst job was I worked at Burger King when I was 14 years old, and I would do the closing shift, and that was from like 6:00 p.m. till about 2:00 in the morning. And in Ontario, where I lived, Ottawa, borders, Quebec, and Ontario. The drinking age is 19. You can see where
I'm going with this.
The drinking age in Quebec is 18 and that year, made all the difference to all these kids. And so they would go get completely drunk. They would come back, they would come to the
Burger King, you know, you would see all these kids you went to high school with, can you imagine a mortifying? It is, you know, you're working there in this getup and they would light that place on fire vomit, everywhere puking, pooing peeing, and when the thing shuts down at 1:00, you know, you got to clean that all up all of it, changing the garbage taking it out. It was a grind.
And it really teaches you. Okay, I do not want this job.
I don't want to, but it's funny that they didn't push you towards the stability and the security of the middle class,
like life have any good examples of that. I didn't have those around me. I was so ashamed. I could have never built a relationship where I could have seen those interactions to want that. And so, my desires were framed by these two random rich people that lived in my town who I'd never met and what I read in magazines about people like
Bill Gates and Warren Buffett.
You weren't early senior executive at Facebook during a period of a lot of scaling in the company history. I mean, it's actually a fascinating period of human history in terms of Technology. Well, in terms of human civilization, honestly, what did you learn from that time about what it takes to build and scale a successful tech company a company that has almost immeasurable impact on the world.
That was an incredible moment in time because everything was so new to your point. Like even how the standards of Web 2.0 at that time, we're being defined, we were defining them, you know? I mean, I think if you, if you look in sort of the, if you search in the patents patent Library, there's a bunch of these patents that like me and Zack have for like, random things like cookies, you know, or like cross-site JavaScript. Like, all these crazy things that are just like these do kind of ideas in
Three. We had to invent our way around, how do websites communicate with each other? You know, how do we build in the cloud versus in a data center? How do we actually have high performance
systems Mission data science the term.
In the end we act, we invented this, I invented this thing called data scientist because we had a PhD from Google that refused to join. Unless because he got a job offer that says data analyst and so he said, call him a scientist because he was a PhD in particle physics. So he really, you know, he was a scientist nice and great your ass.
Scientist hear
that launched a discipline.
That launched a dismayed. A term. You know,
what's a rose by any other name? But yeah, like, you know sometimes words like this you can launch entire fields and it did in that case and you didn't I mean, I guess at that time you didn't anticipate the impact of machine learning on that the entirety of this whole process because you need machine learning to have both ads and recommender systems to have the feed for the Social Network. Exactly. Right.
The first
Will scaled version of machine learning, not AI, but machine learning, was this thing that Facebook introduced called Pym K, which is people, you may know. And the simple idea was that, can we initiate a viral mechanic inside the application, where you log in, we grab your credentials, we go to your email inbox, we Harvest your address book, we do a compare, we make some guesses, and we start to present. Other people that you may actually know that may not be in your address book, really simple.
You know, a couple joins of some tables, whatever, and it started to just go crazy and the number of people that you were creating this density and entropy inside the social graph with what was some really simple basic math and that was eye-opening for us and what it? What it led us down, this path of is really understanding the power of like all this machine learning and so that infused itself into Newsfeed, you know? And how the content that you saw could be tailored to who you were and the type of person that
You are.
So there is a moment in time that all of this stuff was so new. How do you translate the app to multiple languages? How do you launch the company and all of these countries?
How much of it is just kind of stumbling into things using your best. Like, first principles gut thinking and how much is it? Like, 5 10, 15 20 year Vision? Like how much was thinking about the future of the internet and the metaverse and the humanity on?
All that kind of stuff because the newsfeed also sounds trivial. I'll say something
that's like changes everything. Well, you have to remember like, you know, news feed.
Was named and we had this thing where we would just named things, what they were and at the time, all of these other companies and if you go back into the Wayback machine, you can see this people would vent would invent, you know? And I mean, an MP3 player and they would come up with some crazy name or they would invent a software product and come up with a crazy name, right? And it sounded like the Pharma industry, you know, blow Chasm AB no tag your best
Yeah. And you think what is this? This makes no sense and you know this was Luxe thing. He was like well this is a feed of news so we're going to call it news feed. This is where you tag your photos. We're going to call that photo tagging. I mean literally you know pretty obvious stuff. So
The thing, the way that those things came about though is very experimental and this is where I think it's really important for people to understand. I think Bezos explains this the best
there is a tendency after things work to create a narrative fallacy because it feeds your ego and you want to have been the person that saw it coming.
And I think it's much more honest to say we were very good probabilistic thinkers. That tried to learn as quickly as possible meaning to make as many mistakes as possible. You know. It mean, if you look at this very famous placard that Facebook had from back in the day, what did it say? It said, move, fast and break things in societal language that saying make mistakes as quickly as you can because the minute you break something that's new.
Do that by Design. It's not a feature, theoretically, it's a bug, but he understood that and we Embrace that idea. I used to run this meeting once a week where the whole goal was, I want to see that there was a thousand experiments that were run and show me the mall from the dumbest to the most impactful and we would go through that Loop and what did it train people not that you got celebrated for the right answer but you got celebrated for trying Iran, tell 12 experiments.
S12 failed and we'd be like, you're the
best. Can I just take a small tangent on? That is the move fast and break things has become as like a catchphrase of thing, that embodies the toxic culture of Silicon Valley in today's discourse. Which confuses me of course words and phrases get sort of
captured and so becomes very reductive you know that's a very loaded set of words that together can be
Many years later. People can view very reductive Can you steal men each
side of that.
So yeah,
pro move fast and break things and against. Yeah, that's
impressive. So I think the pro of move fast and break things is saying the following, there's a space of things, we know, and a massive space of things, we don't know.
And there's a rate of growth of the things we know.
But the rate of growth of the things we don't know is actually we have to assume growing faster. So the most important thing is to move into the space of the things. We don't know as quickly as possible and so in order to acquire knowledge we're going to assume that the failure mode is the nominal State. And so we just need to move as quickly as we can break as many things as possible, which means like things are breaking in code.
Do the, you know, root cause analysis figure out how to make things better and then rapidly move into this base and he or she who moves fastest into that space will win.
It doesn't imply carelessness, right? It doesn't imply.
Moving fast without also aggressively picking up the lessons from the mistakes you make. Well, again, let's steal Manning the pro, which is, it's a thoughtful movement around velocity and acquisition of knowledge. Now, let's deal man. The the con case,
When these systems become big enough, there is no more room to experiment in an open-ended way because the implications have broad societal impacts that are not clear up front, so let's take a different less controversial example, if we said, you know, Lipitor worked well for all people except South Asians and there's a specific immune response that we can iterate.
82 and if we move quickly enough, we can run 10,000 experiments. And we think the answer is in that space.
Well, the problem is that those 10,000 experiments May kill 10 million people. So you have to move methodically when that drug was experimental and it wasn't being given to 500 million people in the world. Moving fast made sense because you could have a pig model a mouse model a monkey model. You could figure out toxicity but we picked all that low hanging fruit. And so now these small iterations have huge impacts that need to be measured and
Wanted different example is like, you know, if you work at Boeing and you have an implementation that gives you a two percent efficiency by reshaping the wing or adding winglets.
There needs to be a methodical move. Slow be right process.
Because mistakes when they compound when it's already implemented and that scale have huge externalities that are impossible to measure until after the fact and you see this in the 737 Max. So that's how one would steal man. The second case which is that when an industry becomes critical, you gotta slow down
makes me sad because some Industries like Twitter and Facebook are good example. They achieve scale very quickly.
Before really exploring the big area of things to learn. So you basically pick one low-hanging fruit and that became your huge success. And now you're sitting there with that stupid freely.
Well, so your, I think so, as an example, like, you know, if you had to
You know, if, if I was running Facebook for a day, you know, the big opportunity in my opinion was really not the metaverse, but it was actually getting the closest that anybody could get to AGI.
And if I had to steal man, that product case, here's what how I would have pitched it to the board and de zaak. I would have said, listen, there are three and a half billion people monthly using this thing. If we think about human intelligence very reductively, we would say that there's a large portion of it, which is cognitive. And then there's a large portion of it, which is emotional. We have the best ability to build a multi-modal model that basically takes all of these massive inputs together to try.
Hi to Intuit. How a system would react to all kinds of stimuli.
That to me would been a profound Leap. Forward for Humanity,
can you dig into that a little bit more? So in terms of
Has a board meeting. How would that make Facebook
money?
I think that you have all of these systems over time, that that we don't know could benefit from some layer of reasoning to make it better. What does Spotify look like when instead of just a very simple recommendation engine, it actually understands sort of your emotional context in your mood and can move you to a body of music that you would like,
What does it look like if you know your television instead of having to go and channel surf? You know, fifty thousand shows on a horrible you I you know instead just has a sense of what you're into and shows it to you. What does it mean? When you get in your car and it actually drives you to a place because you should actually eat there even though you don't know it, these are all random things that make no sense a priority, but it starts to make
The person or the provider of that service, the critical reasoning layer for all these everyday products. That today would look very flat without that reasoning. And I think you license that and you make a lot of money. So, in many ways, instead of becoming more of the pixels that you see you become more of the bare metal, that actually creates that experience. And if you, and if you look at the companies that are multi-decade Legacy, kinds of businesses, the thing that they have done is
Quietly and surreptitiously moved down, the stack, you never move up, the stack to survive, you need to move down the stack. So if you take that OSI, reference stock right, these layers of how you build an app from the physical layer to the transport layer, all the way up to the a player, you can map from the 1980s. All the big companies that have been created, right? All the way from Fairchild, semiconductor an at semi to Intel to Cisco. 23. Calm, you know, oracle Netscape at
One point all the way up to the Googles and Facebooks of the world. But if you look at where all the lock-in happened,
It's by companies like apple who used to make software saying, I'm going to get one close. I'm going to make the bare metal and I'm going to become the platform or Google, same thing. I'm going to create this dominant platform and I'm going to create a substrate that organizes all this information that's just omnipresent and everywhere. So the key is, if you are lucky enough to be one of these apps,
That are in front of people.
You better start digging quickly and moving your way down and get out of the way and disappear. But by disappearing, you will become much, much bigger and it's impossible to usurp
you. Yeah, I 100% agree with you. That's why you're so smart. This is a the depersonalization and the algorithms that enable depersonalization almost like a operating system layer. So pushing away from the interface,
Face in the actual system that does the personalization. I think the challenge is there, there's obviously technical challenges
but there's also societal challenges that
It's like an relationship. If you have an intimate algorithm, a connection with individual humans, you can do both good and bad and so there's risks that you're taking you can. So if you're making a lot of money now is Twitter and Facebook with ads surface layer adds, what is the incentive to take the risk of guiding people more? Because you can hurt people, you can piss off people, you can, I mean,
It there is a cost to forming a more intimate relationship with the
users in the short term. I think you said a really, really key thing, which is, which was a really great emotional instinctive reaction, which is when I said, the AGI thing, you said, well, how would you ever make money from that? That is the key. The presumption is that this thing would not be an important thing at the beginning. And I think what that allows you to do, if you were to Twitter or Google, or Apple or Facebook, anybody Microsoft
Embarking on building something like this, is that you can actually have it off the critical path and you can experiment with this for years. If that's what it takes to find a version one, that is special enough where it's worth showcasing. And so in many ways you get the free option, you're going to be spending. Any of these companies will be spending tens of billions of dollars in Opex and capex. Every year and all kinds of stuff. It is not a thing that money
He actually makes more likely to succeed. In fact, you actually don't need to give these kinds of things, a lot of money at all. Because starting in 2023 right now, you know, you have the two most important tectonic shifts that have ever happened in our lifetime and Technology. They're not talked about but these things allow AGI I think to emerge over the next 10 or 15 years where it was impossible for. The first thing is that the marginal cost of energy is zero
I gotta pay for anything anymore, right. And we can double click into why that why that is. And the second is the marginal cost of computer 0. And so when you when you take the multiplication or you know if you want to get really fancy mathematically, the convolution of these two things together, it's going to change everything so think about what a billion dollars gets today when we can use open AI as an example.
A billion dollars gets open AI, a handful of functional models and a pretty fast iterative loop, right? But imagine what open a I had to overcome that overcome a compute challenge. They have to strip together a whole bunch of gpus that to build all kinds of scaffolding software. They have to find data center support that consumes all kinds of money so that billion dollars didn't go that far. So it's a testament to how clever
that opening I team is but in four years from now when energy cause zero and basically gpus are like, you know, they're falling off a truck and you can use them for effectively for free.
Now, all of a sudden, a billion dollars gives you some amount of teraflops of compute that is probably the total number of teraflops available today in the world. Like, that's how gargantuan this move is. When you take these two variables to 0, there's like a million things to
ask. I almost don't want to get distracted by the marginal cost of energy going to 0 because I have no idea what you're talking about that as fascinating. I give you the 30 SEC. Sure? Okay, yes,
so if you look inside of the two, most
Aggressive States, the three most Progressive States, New York, California, and Massachusetts a lot of left-leaning folks. A lot of people who believe in climate science and climate change, the energy costs. In those three states are the worst. They are in the entire country and energy is compounding at three to four percent per annum. So every decade to 15 years energy costs in these states, double in some cases. And in some months our energy costs are increasing by 11 percent a month.
But the ability to actually generate energy is now effectively zero the cost per kilowatt hour to put a solar panel on your roof and a battery wall inside your garage. It's the cheapest it's ever been these things are the most efficient they've ever been and so to acquire energy from the Sun and store it for your use, later on literally is a zero cost
proposition with how they explain the gap between the cost
going. Great question. So, this is the
Their side of regulatory capture, right? You know, we all fight to build monopolies while there are monopolies hiding in plain sight. The utilities are a perfect example. There are 100 million homes in America, there are about 1,700 Utilities in America, so they have captive markets, but in return, for that captive Market, the law says, need to invest a certain amount per year in upgrading that power line in changing out. That turbine in making sure you transition from coal.
Coal to wind or whatever.
Just as an example, upgrading power lines in the United States over the next decade is a two trillion dollar proposition. These 1700 organizations have to spend. I think it's a quarter of a trillion dollars a year.
Just to change the power lines. That is why even though it costs nothing to make energy, you are paying double every five. Every seven or eight years, it's capex and Opex of a very brutal old infrastructure. It's like you trying to build an app and being forced to build your own Data Center and you say, but wait, I just want to write to AWS. I just want to use gcp. I just want to move on. All that complexity is solved for me and some losses. No, you can't. You got to use it. So that's what consumers are dealing with, but
Also what industrial and Manufacturing organizations. It's what we all deal
with. So how do we get rid ourselves of this old infrastructure?
There were paying. So the thing that's happening today which I think is this is why I think it's the most important Trend. Right now in the world is that 100 million homeowners are each going to become their own little power plant and compete with these 1700 utilities
and that is the United
States are global.
Just just deal with the United States for a second because I think it's easier to see here, 100 million homes, solar panel on the roof. And by the way, just to make it clear, the sun doesn't need to shine right these these panels now work, where you have these UV bands, I can actually extrapolate beyond the visible spectrum, so they're usable in all weather conditions, and a simple system can support you collecting enough power to not just run your functional day-to-day life.
but then to contribute, what's leftover back into the grid for Google's data center or Facebook's data center, where you get a small check
The cost is going to
0, how obvious is this to people? You're making a sound okay. So, because this is a pretty profound prediction if the cost is indigo, 20 that. I mean, the compute. The cost of compute going is 0. I can.
So the cost of compute going
to 0 is can kind of understand, but the energy seems like a radical prediction of yours.
Well, it's just, it's just naturally. What's happening right now? Let me, let me give you a different, a different way of explaining this, if you look
Look at any system. There's a really important thing that happens. It's what clay Christensen calls crossing the chasm, if you explained it numerically, here's how it explain it to you Lex. If you introduce a disruptive product, typically, what happens is the first three to five percent of people are these zealous Believers. And they ignore all the logical reasons. Why this product doesn't make any sense.
Because they believe in the proposition of the future and they buy it. The problem is at 5%. If you want to product to get to mass Market, you have one of two choices which is you either bring the cost down low enough or the feature set becomes so compelling that even at a high price point. An example of the latter is the iPhone the iPhone today. The 14 iPhone cost more than the original iPhone. It's probably doubled in price over the last 14 or 15 years, but we view it as an
Social element of what we need in our daily lives.
It turns out that battery EVs and solar panels are an example of the former because people like President Biden, with all of these subsidies have now, introduced so much money for people to just do this, where it is a money-making proposition for 100 million homes. And what you're seeing as a result are all of these companies who want to get in front of that Trend. Why? Because they want to own the relationship with 100 million homeowners.
Hours, they want to manage the power infrastructure. Amazon Home Depot Lowe's. You know, you can just name the company, so if you do that and you control that relationship, they're going to show you. They're going. You know, for example, Amazon will probably say if you're a member of prime rule, stick the panels on your house for free, will do all the work for you for free. And it's just a feature of being a member of prime and we'll manage all that energy for you. It makes so much sense and it is mathematically.
Kalia creative for Amazon to do that. It's not a creative.
For the existing energy industry because they get blown up, it's extremely accretive for peace and prosperity. If you think the number of words, we fight over natural resources, take them all off the table. If we don't need energy from abroad, there's no reason to fight this. You'd have to find a reason to fight. Meaning sorry, there be a moral reason to fight, but the last number of words that we fought, we're not as much rooted in Morality as they were rooted in.
Yeah, it feels like they're very
Much rooted in conflicts or over resources energy
specifically and then, sorry, just the last thing I want to say, I keep energy problems but the chips. All what people want to say is that, you know, now that we're at 2 & 3, nanometer scale for typical, kind of like transistor Fab we're done. And you know forget about transistor density, forget about Moore's, Lots over and I would just say no look at teraflops and really teraflops is the combination of CPUs. But
Much, much less important, and really is the combination of a 6. So application-specific ICS and gpus and so you put the two together. I mean if I gave you a billion dollars five years from now, the amount of damage you could do damage in good way, in terms of, you know, building racks and racks of gpus, the kind of models that you could build the training sets in the data that you could consume to solve a problem.
It's it's enough to do something really powerful, whereas today, it's not yet quite enough.
So there's this really interesting idea the talk about in terms of Facebook and Twitter. That's connected to this, that if you were running sort of Twitter or Facebook that you would move them all to like AWS. So you would have somebody else to come the compute the infrastructure. It probably, if you could explain that reasoning means that
You believe in this idea of energy going to zero compute going to 0. So let people that are optimizing that
do the best job. And I think that's a you know the initially in the early 2000s and the beginning of the 2010s, if you were big enough scale I'm sorry everybody was building their own stuff, then between 2010 through 2020. Really the idea was everybody should be on AWS except the biggest of the biggest folks.
I think in the 2020s and 30s, I think the answer is actually, everybody should be in these public clouds, and the reason is the engineering velocity of the guts.
So, you know, take a simple example, which is, you know, we have not seen a massive iteration in database design until snowflake. Right. I think maybe postgres was like the last big turn of the dial. Why is that? I don't exactly know. Except that everybody that's on AWS and everybody that's on gcp and Azure gets to now benefit from 100 plus billion dollars of aggregate market cap rapidly iterating.
Making mistakes fixing solving learning, and that is a best-in-class industry. Now right? Then there's going to be all these AI layers around analytics, so that app companies can make better decisions. All of these things will allow you to build more Nimble organizations because you'll have this Federated model of development. I'll take these things off the shelf. Maybe I'll roll my own stitching over here.
Because the thing that where you make money is still for most people and how the apps provision and experience to a user and everybody else can make a lot of money just servicing that. So they work in a really they play well together in the sandbox. So in the future, everybody just should be there. It doesn't make sense for anybody. I don't think because you know, if you were to rule your own data centers, you know, for example, a Google for a long time, had these massive leaps where they had GFS and big table
Those are really good in the 2000s and 2010's and this is not just throw shade at Google, it's very hard for whatever exists. That is a that is the progeny of GFS in bigtable to be anywhere near as good as a hundred billion dollar Industries attempt to build that stack and you're putting your organization under enormous pressure to be that good,
I guess the implied risk taken there is that you could become the next AWS like Tesla, doing some of the
Compute in house.
I guess the bet there is that you can become the next the next AWS for the new wave of computation, if that level, if that kind of computation is different. So if it's machine learning, I don't know if anyone's won that battle yet, which is machine learning Centric. Well, I complete
software has a very powerful property in that. There's a lot of things that can happen asynchronous asynchronously. So that real-time inference can be
Actually really lightweight code deployment. And that's why I think you can have a very Federated ecosystem. Inside of, inside of all of these places, Tesla is very different. Because in order to build the best car, it's kind of like trying to build the best iPhone which is that you need to control it all the way down to the bare metal in order to do it. Well, and that's just not possible. If you're trying to be a systems integrator, which is what everybody other than this modern generation of car companies,
Have been and they've done a very good job of that, but it won't be the experience that allows you to win in the next 20 years.
So, let's Linger on this social media thing. So if you said, if you ran Facebook for day, let's let's, let's extend that. If you were to build a new Social Network today, how would you fix Twitter? How would you fix social media if you want to answer different question?
Is if you were Elon Musk somebody, you know and you were taking over Twitter, what would you
fix? I've thought about this a little bit.
First of all let me give you a backdrop. I wouldn't actually build a social media company at all and the answer is the reasoning is the following. I really tend to believe as you probably got in a sense of sort of patterns and probabilities and if you set to meet your mouth, probabilistically answer, where, where are we going in apps and social experiences? What I would say is Lex, we spent the first decade building platforms and getting them to
Gail. And if you want to think about it, again, back to sort of this poker analogy others, mistakes - your mistakes is the value. While the value that was captured was trillions of dollars, essentially to Apple and to Google.
And they did that by basically attracting billions of monthly active users to their
platform.
Then this next wave where the apps Facebook, QQ, tencent Tick Tock, Twitter, Snapchat, that whole panoply of apps and interestingly, they were in many ways an atomized version of the platform's, right? They sat on top of them, they were an ecosystem, participant.
But the value they created was the same.
Trillions of dollars of Enterprise Value billions of monthly active users. While there's an interesting phenomenon that's kind of hiding in plain sight, which is that the next most obvious Atomic unit are content creators. Now, let me give you two examples. Lex Friedman this Brandon crazy guy. You mr. Beast. You know, Jimmy Donaldson just the two of you alone, add added up, okay? And you guys are going to approach
in the next five years, a billion people. The only thing that you guys haven't figured out yet is how to capture trillions of dollars of value. Now, maybe you don't want to and maybe that's not your stated
Mission it, right, right. But let's just look at mr. Beast alone, because he is trying to do exactly that
probably. And I think Jimmy is going to build an enormous business. But if you take Jimmy and all of the other content creators, right? You guys are atomizing
What the apps have done.
You're providing your own curated news feeds, you're providing your own curated communities, you're allowed you, let people move in and out of these things in a very lightweight way and value is accruing to you. So, the honest answer to your question is, I would focus on the content creator side of things because I believe that's where the puck is going. That's a much more important shift in how we all consume information content and are entertained. It's through Brands, like you individual people that we can humanize and
Stand. Are the
filter, but aren't you? Just arguing against the point you made earlier, which is what you would recommend is the invest in the AGI the depersonalization because what?
Because they could still be a participant in that, in that end state. If that happens, you have the option value of being an enabler of that, right? You can help improve what they do. Again, you can be this bare metal service provider, where you can be attacks, yeah, right. You can participate.
In every thing that you do, every question, that's asked every comment, that's curated. If you could have more intelligence as you provide a service, to your fans, in your audience, you would probably pay a small percentage of that Revenue. I suspect all content creators would and so it's that stack of services. That is like a smart human being. It's like, you know, how do you help produce this information? You would pay a producer for that. I mean, maybe you would. But so back to your question, so what would I do? I think that you have to move into that world.
Old pretty aggressively. I think that right now you first have to solve what is broken inside of these social networks. And I don't think it's a technical problem. So just to put it out there, I don't think it's a, you know, it's one where there are these nefarious organizations that happens, we're gating XYZ that happens but the real problem is a psychological one that we're dealing with which is
People through a whole set of situations.
Have lost.
Belief in themselves.
and I think that, that
Comes up as this very virulent form of rejection that they tried to put into these social networks. So if you look inside a comments on anything, like you could have a car. Like, you could have a person that says on Twitter. I saved this dog from a fiery building and there would be - commenters and you're like, well, again, put yourself in their shoes. What do you, how do I Steel, Man, their case? I do this all the time. You know, I get people throw shade at me and like, okay, let me steal man their point of view and the best that
I can come up with is you know, I'm working really hard over here. I'm trying I played by all the rules that were told to me. I've played well, I played fairly and I am not being rewarded in a system of value that you recognize and that is making me mad.
And now I need to cope and I need to vent. So, back in the day, my dad used to drink, he would make me go get things to hit me with today. You go to Twitter, you spot off. You try to deal with the latent anger that you feel. So a social network has to be designed in my opinion to solve that psychological Corner case because it is what makes a network on usable to get real density. You have to find a way of moving away from that toxicity because it
Ruins a product experience. You could have the best pixels in the world. But if people are virulently spitting into their keyboards, other people are just going to say, you know what, I'm done with this, it doesn't make me feel good. So the social network has to have a social cost. You can do it in a couple ways. One is where you have real-world identity so then there's a cost to being virulent and there's a cost to being caustic. A second way is to actually just overlay.
An economic framework. So that there is a more pertinent economic value that you assign to basically spouting off. And the more you want to spend the more you can say and I think both have a lot of value. I don't know what the right answer is. I tend to like the ladder, I think real world identity shuts down a lot of debate because there's still too much. You know, there's a sensation that there that there would be some retribution. So, I think there's more free speech over here, but it
It cannot be Costless because in that, there's a level of toxicity that just makes these products on usable
third option. And by the way, all these work together
If we look at this, what you call the Corner, case was just hilarious, what I would call The Human Condition
which is, you know, that anger is rooted with the challenges of life and what about having a an algorithm that shows you what you see that's personalized to you and helps you maximize your personal growth.
Long-term. Such that you're challenging yourself, you're improving your learning. There's just enough of criticism to keep you on your toes, but just enough of like the dopamine rush to keep you entertained and finding that balance for each individual
person. You just described in AGI of a very empathetic well-rounded friend.
Yes, exactly. And and then you can throw that person even Anonymous into a
A pool of Disco Under percent and they would be
better. I think you're absolutely right as a very, very, very elegant way of stating it, you're
upset but like you said, the AG I might be a few years away. So that's a huge investment that my concern. My gut feeling is this age thing? We're calling a GI is actually not that difficult to build technically, but it requires a certain culture and it requires a certain certain risks to be
taken, I think you could reductively boil down
The human intellect into cognition and emotion and, you know, depending on who you are depending on the moment. They're weighted very differently, obviously, cognition is so easily done by computers.
That we should assume that that's a solved problem. So, our differentiation is the reasoning part, it's the emotional overlay. It's that it's the empathy. It's the ability to steal, man, the opposite persons case in and feel why that person, you know, you can forgive them without excusing. What they did as an example that is a very difficult thing. I think the capture and software, but
I think it's a matter of when not if
if done crudely, it takes a form of censorship just Banning people off the platform. Let me ask you some tricky questions. Do you think Trump should have been removed from Twitter? Now, what's the, what's the pro case can I'm having fun here still? He's
still man each side. Yeah let's steal man to get
Them off the platform.
Here, we have a guy who is virulent in always, he promotes confrontation, he lacks decorum, he incites. The fervent Believers of his cause to act up and push, the boundaries bordering on and potentially even including breaking the law. He does not observe the social norms of a society that keep us
Functioning including an orderly transition of power. If he is left in a moment where he feels trapped and cornered, he could behave in ways that will confuse the people that believe in him to act in ways that they so regret that it could bring our democracy to an end or create so much damage or create a wound. That's so deep. It will take years of conflict and years of Confrontation to heal it.
Do we need to remove him and we need to do it now, it's been too long. We've Let It Go on too long.
The other side of the argument would be, he was a duly elected person whose views have been run over for way too long. And he uses the ability to say extreme things in order to Showcase how corrupt these systems have become and how insular these organizations are and protecting their own class. And so if you really want to prevent class Warfare and if you really
Early want to keep the American dream alive for everybody. We need to show that the First Amendment the Constitution, the Second Amendment. All of this infrastructure is actually bigger than any partisan view, no matter how bad it is and that people will make their own decisions.
And there are a lot of people that can see past the words he uses and focus on the substance of what he's trying to get across and more generally agree than disagree. And so when you silence that voice, what you're effectively saying is this is a rigged game and all of those things that we've told we were told we're not true are actually true.
If you were to look at the crude algorithms of Twitter, of course I don't have any Insider knowledge but
I could imagine that they saw. The this let's say there's a metric that measures how - the experiences of the platform and they probably saw in several ways, you can look at this. But the presence of Donald Trump on the platform was consistently, increasing, how shitty people are feeling short-term and long-term, because they're probably yelling at each other, having worse, and worse and worse experience, if you even do a survey of
How do you feel about using this platform over the last week? They would say horrible relative to maybe a year ago when Donald Trump was not actively Tweeting or so on. So, here you're sitting at Twitter and saying, okay, I, I know everyone's talking about speech and all that kind of stuff, but I kind of want to build a platform where the users happy and they're becoming more and more unhappy. How do I solve this happiness problem? Well, let's ban
Let's let's yeah, let's ban the sources of the unhappiness. Now we can't just say you're a source of unhappiness will ban you. Let's wait until that's or say something that we can claim. Breaks our rules, like incites,
violence or so on that would work. If you could measure your constructive happiness properly. The problem is, I think what Twitter looked at were active commenters and got it. Confused for overall system happiness, because for every piece of content that's created.
On the internet of the hundred people that consume it, maybe one or two people comment on it. And so, by over amplifying that signal and assuming that it was the plurality of people, that's where they actually made a huge blunder because there was no scientific method, I think to get to the answer of D platforming him and it did expose this idea that it's a bit of a rigged game. And that there are these deep biases that some of these organizations,
Ian's have two opinions that are counter to their has into their Orthodox view of the
world.
So in general you lean towards keeping first of all presidents on the platform but also controversial voices all the time I think it's really important to keep them there. Let me ask you a trick tricky. One in the recent news that's become especially relevant for me. What do you think about if you've been paying attention to ye Kanye West recent controversial, Outburst on social media about,
And Jews black people racism. General slavery, Holocaust. All these topics that he touched on in different in different ways on different platforms. But including Twitter, what do you, what do you do with that? And like what do you do? What do you do with that ethanol? Platform perspective of what do you do for my Humanity perspective of how to add love to the world?
Let's should we take both sides of them? Sure. Option. One is he is completely out of line and option. Two is. He's not just as I'm sure, right? So, the path One is using incredibly important taste maker in the world that defines the belief system for a lot of people and there just is no room for any form of
Racism or bias or anti-Semitism in today's day and age. Particularly by people whose words and comments will be Amplified around the world. We've already paid a large price for that and then the expectation of success is some amount of societal decorum that keeps moving the ball forward.
The other side would say.
Life, I think goes from Harmony to disharmony to repair.
And anybody who has gone through a very complicated divorce will tell you that in that moment, your life is extremely disharmonious, and you are struggling to cope and because he is famous. We are seeing a person really struggling in a moment.
That may need help and we owe it to him, not for what he said, because that stuff isn't excusable, but we owe it to him to help him in a way and particularly his friends. And if he has real friends, hopefully what they see is that what I see on the outside looking in is a person that is clearly struggling.
It could ask you to look a human question and I know it's outside looking in, but there's several questions I want to ask. So one is about the pain of going through a divorce and having kids and all that kind of stuff and to when you're rich and powerful and famous, I don't know. Maybe you can enlighten me do, which is the most corruptive, but how do you know who are the friends to trust?
So, a lot of the world is calling Kanye, insane, and if warlock has mental illness, all that kind of stuff. And so, how do you have friends close to you? Let's say, let's say something like that message, but from a place of love and where they actually care for you as opposed to trying to get you to shut up.
The reason I asked all those questions, I think. If you care about the guy, how do you help them, right?
I've been through a divorce. It's gut-wrenching. The most horrible part is having to tell your kids.
I can't even describe to you how proud I am of and how resilient these three beautiful little creatures were when my ex-wife and I had to sit them down and talk through it. And for that thing I'll be so protective of them and so proud of them and it's hard. Now I don't know that that's what he went through, but it doesn't matter. In that moment. There's no Fame. There's no money, there's nothing. There's
Of raw intimacy of a nuclear family breaking up in that. There is a death and it's the death of that idea. And that is extremely extremely profound in its impact, especially in your children, it is really hard, really
hard. Could you have seen yourself in the way you see the world being clouded during especially at first to where you would make poor decisions outside of your
You're outside of that nuclear family, so like business, poor business decisions, poor tweeting, decisions poor.
I think that writing this, if I had to boil down a lot of those, what I would say is that there are moments in my life lacks where I have felt meaningfully less than and in those moments, the loop that I would fall into is I would look to cope and be seen by other people. So I would throw away. All of the work I was doing around my
Internal validation.
And I would try to say something or do something that would get the attention of others. And often times, you know, when that Loop was was unproductive, it's because those things had really crappy consequences. So, you know, that was, that was, yeah. So, yeah, I went through that as well. So I had to go through, you know, this disharmonious phase in my life. And then, to repair it, you know, I had the benefit of meeting someone and building a relationship,
Chip block by block where there is just enormous accountability where my partner not had has just incredible empathy.
But accountability and so she can put yourself in my shoes sometimes when I'm a really tough person to be around. But then she doesn't let me off the hook. She can forgive me, but it doesn't make, you know, what? I may have said or whatever, you know, excusable and that's been really healthy for me and it's help me repair. My relationships be a better parent, you know, be a better friend to my ex-wife. Who's a beautiful woman who, you know, I love deeply and will always
I love her. And it took me a few years to see that that it was just the chapter that had come to an end, but she's an incredible mother and an incredible business woman. And I'm so thankful that I have had two incredible women in my life. That's like a blessing to but it's hard.
So what would that it's hard to find a person that has that these, I mean a lot of stuff. You said, it's pretty profound, but having the person who has empathy and accountability. So basically that's ultimately what great friendship is.
Which is people that love. You have empathy for you but can also call you out on your
bullshit. He's a LeBron James like figure. And the reason I say that is I've seen and met so many people. I've seen the Distribution on the scale of friendship and empathy,
she's the LeBron James of friendship,
she's a goat. Well, what's so funny is like, you know, we have a dinner around poker and it's taken on a life of its own mostly because of her. Because these guys looked
Her and I'm like what will she stick it? Like her registers are already full she's thinking all kinds of crap with me but but it's it's a very innate skill and it's paired with you know it's but it's not just an emotional thing. Meaning she's the person that I make all my decisions with these decisions were making together as a team. I've never understood that you know there's an African proverb like go fast go.
Alone, go far go together. And Alexis since I was born, I was by myself and I had to cope and I didn't have a good tool kit to use into the world.
And in these last five or six years, she's helped me. And at first, my toolkit was literally like sticks, you know, and then I found a way to, you know, she helped me sharpen a Little Rock and that became a little knife, but even that was crap. And then she showed me fire and then I forged a knife and that, and that's what it feels like. We're now this toolkit is like, most average people and I feel humbled to be average because I was here down here on the ground.
So, it's made all these things more reasonable. So I see what comes from having deep profound friendships and love to help you through these critical moments. I have another friend who who I would say just completely unabashedly loves me. This guy Rob Goldberg. He doesn't hold me accountable, that much, which I love like, I could say, I killed a homeless person. He said, they probably deserve it. You know, whereas not will be like, that was not good, what you just did.
So but I have both, I mean I have not everyday, you know, Rob I don't talk to that often but to have two people. I had zero, I think most people unfortunately have zero. So I think like what what he needs is somebody to just listen you don't have to put a label on these things and you just have to try to guide in these very unique moments, where you can just like deescalate
What is going on in your mind and I suspect what's going on in his mind again, to play armchair quarterback? I don't know, is that he is in a moment where he just feels lower than low. And we all do it, we've all had these moments where we don't know how to get attention and if you didn't grow up in a healthy environment, you may go through a negative way to get attention and it's not to excuse it, but it's to understand it.
That's so profound the feeling less than, and at those low points, going externally to find it and maybe creating conflict and Scandal to get that attention.
The way that my doctor explained it to me is
You have to think about yourself worth, like, a not. It's inside of a very complicated set of knots. So it's like a, some people don't have these knots, it's just presented to you on a platter. But for some of us because of the way we grow up, it's covered in all these knots. So the whole goal is to loosen those knots.
And it happens slowly, it happens, unpredictably and it takes a long time. And so while you're doing that, you are going to have moments where when you feel less than you're not prepared to look inside and say, actually, here's how I feel about myself, it's pretty cool. I'm happy with how where I'm at
I have to ask on the topic of friendship, you do an amazing podcast called all in podcast people should stop listening to this and go listen to that. You just did your 100th episode. I mean, it's one of my favorite podcasts incredible for the the the technical and the human psychological wisdom that you guys.
Constantly give an in the way you analyze the world but also just The Chemistry Between the between you your clearly, there's there's a tension and there's a camaraderie that's all all laid out on the table. So I don't know the two David's that. Well, but I have met Jason, what do you love about them?
I mean, I'll give you a little psychological breakdown of all three of these guys. Sure, just my opinion. Yeah, and I love you guys.
Would they agree with your psychological breakdown? I
don't know. You know, I think that what I would say about Jake a Liz, he is unbelievably loyal to no end and, you know, he's like any of those movies where which are about like the mafia whatever we're like, you know, something bad's going wrong and you need somebody to show up.
That's Jake. Oh,
so if you killed the sud proverbial homeless person he would be right there to help your body. Yeah. But
he's the one that he'll defend you in every way shape or form. Even if it's not, doesn't make sense in that moment, he doesn't see that as an action of whether it'll solve the problem. He sees that as an act of Devotion to you your friend, and that's an Incredible Gift that he gives us. The other side of it is that, you know, Jay Cal needs to learn how to trust that.
Other people love him back. As much as he loves us.
And that's where he makes mistakes because he assumes that he's not as lovable as the rest of us. But he's infinitely. More loveable than he understands. He's I mean you have to see Lex like he is unbelievably funny. I mean I cannot tell you how funny. This guy is next-level funny. It has timing timing, everything charm, the care he takes. So he is as lovable, but he doesn't believe himself to be. And that manifested itself in areas that drive us all crazy.
It from time to time,
which makes it for a very pleasant listening experience. Okay, so what about the, the two David's, their sacks and their
Friedberg. David Sachs is the one that I would say. I have the most emotional connection with he and I can go a year without talking and then we'll talk for four hours straight and then we know where we are and we have this ability to pick up and have a level of intimacy with each other and I think that's just because I've known David for so long. Now that I find
Really comforting and then Freiburg. Is this person who I think similar to me had a very turbulent, upbringing has fought through it to build an incredible life for himself and I have this enormous respect for his journey. I don't particularly care about his outcomes to be honest but I just have I look at that guy and I think he did it and so if I didn't do it I would be glad that he did it, if it makes any sense.
and you can see that he feels like his entire responsibility is really around his kids and just kind of like give a better counterfactual
And and, you know, sometimes I think he gets that right and wrong but he's a very special human being though.
I'm not show the two of you have a very kind of like, from a geopolitics perspective. I don't know. There's just a very effective way to think deeply about the world. The big
picture of the world. He's a very systems-level thinker. We like a city. That's really what I put it. Yeah. Very very absolutely,
very systems level. So the
and you never,
Very rooted in, you know, a broad body of knowledge which I have a tremendous respect for. He brings all these things in sacks is incredible because he has this unbelievable understanding of things, but it has a core nucleus. So Freiburg can just basically abstract a whole bunch of systems and talk about it. I tend to be more like that where I try to kind of I find it to be more of a puzzle. Socks is more like anchored and you know a philosophical and historical context as the
Answer and he starts there but he gets to these profound understandings of systems as well
on the podcast in life. You guys hold to your opinion, pretty strong. What's what's the secret to being able to argue passionately with friends? So, hold your position. But also not murder each other, which you guys seem to come close to.
I think it's like strong opinions, weakly held.
So
I think the renu-it with that point, is that a haiku? Or is it can you explain that
please? I like you know like look today you and I what have we steal man? Like the two sides of three different things. Yeah. Now you could be confused and think I believe in those things, I believe that it's important to be able to intellectually Traverse there, whether I believe in it or not and like, steal men, not to parent. Like, that's a
really, but we intro'd those things by saying, let us steal men. This
Action. Sometimes you guys skip the. Let
me skip. You're right, we added those things out and sometimes we'll sit on either sides and we'll just kind of bad things back and forth just to see what the other person
thinks. So that's how like as fans we should listen to that sometimes, like so sometimes because because you hold the strong opinion sometimes, like for example, the cost of energy going to 0,
Is that like what's the degree of certainty on that is? Is this kind of like you really taking a prediction of how the world will unroll? And if it does this benefit, a huge amount of companies and people that will believe that idea. So you really you like, you spend a few days, a few weeks of that
idea. I've been spending two years with that idea, and that idea has manifested into
many pages and pages of more and more branches of a tree, but it started with that idea. So, if you think about this tree, this logical tree that I built, I would consider it more of a mosaic and at the at the base or root, however you want to talk about it is this idea, the incremental cost of energy goes to 0. How does it manifest? And so I talked about one traversal, which is the competition of households versus utilities but if even some of
That comes to pass. We're going to see a bunch of other implications from a regulatory and Technology perspective if some of those come to pass. So I've tried to think, think sort of this, you know, 678 hops forward and I have some like to use a chess analogy. I have a bunch of short lines, which I think can work, and I've started to test those by making Investments.
Tens of millions over here, 200 Millions over there. But it's a distribution based on how probabilistic, I think this these outcomes are and how downside protected I can be and how much I will learn how many mistakes I can make, you know, etcetera and then very quickly over the next two years, some of those things will happen or not happen and I will rapidly re underwrite and I'll rewrite that tree and then I'll get some more data on make some more Investments.
And I'll rapidly re under right. So you know, in order for me to get to this tree, maybe you can ask, how did I get there? It was complete accident. The way that it happened. Was I have a friend of mine, who works at a great organization, called Fortress Is name is Drew McKnight, and he called me one day and he said, hey, I'm doing a deal with you anchor it, we're going public and it's a rare earth, mining company. And I said Drew, like, if I'm going to get tarred and feathered in Silicon Valley, for backing, a mining company and he said, your mouth just talked to the guy and learn
And the guy Jim Litton ski blew me away. He's like here's what it means for energy. And here's what it means. For the supply chain. Here's what it means for the United States versus China.
But lacks, I did that deal and I did seven others and that deal made money, the
seven others.
But I learned, I made enough mistakes where the net of it was I got to a thesis that I believe in, I could see it. And I was like, okay, I paid the price, I acquired the learning, I made my mistakes, I know where I am at, and this is step one and then I learned a little bit more. I made some more Investments and that's how I, that's how I do the job. That's the
not that you try to wait for perfection in order to make a bet either on yourself or company or girlfriend whatever it's too late.
So if we just Linger on that tree, it seems like a lot of geopolitics, a lot of international military. Even conflict is around energy. So how does your thinking about energy? Connect to what you see happening in the next 10, 20 years? Maybe you can look at the one Ukraine.
Or relationship with China and other places through this lens of energy. Whatwhat's. The hopeful, what's the cynical trajectory that the world might take through this drive towards Zero, Energy, Zero cost energy.
So the United States was in a period of energy Surplus until the last few years, some number of
years in Trump, and I think some number of now the current Administration with President Biden,
but we know what it means to
We have more than enough energy to fund our own domestic manufacturing and living standards. And I think that by being able to generate this energy from the Sun, that is very capex. Efficient that is very climate. Efficient gives us a huge Tailwind. The second thing is that we are now in a world in a regime for many years to come of non zero, interest
rates
and it may interest you to know that the
Really the last time that, you know, we had long dated Wars supported, you know, at low interest rates was World War Two, where I think the average interest rates was like 1.0 7% in the tenure.
And every other War tends to have these very quick open and closes because these long protracted fights, get very difficult to finance when rates are nonzero. So just as an example, even starting in 2023. So the Practical example today in the United States is President Biden's, budget is about 1.5 trillion. And for next year, that's not including the entitlement spending, okay? Meaning Medicare Social Security. Right? So the stuff that he wants to spend that, he has discretion over
Is about one point five eight. Two trillion is the exact number next year. Our interest payments are going to be 455 billion dollars. That's 29 percent of every budget dollars going to pay interest.
So you have these two worlds coming together, right? Lex, if you have us, you know, hurtling forward to being able to generate our own energy and the economic Peril that comes with trying to underwrite several trillion dollars for war which we can't afford to pay when rates are at 5% means that despite all the Bluster, the probabilistic distribution of us. Engaging in war with Russia and Ukraine seems relatively low.
The, the override would obviously be immoral.
Reason to do it, that may or may not come. If there's some nuclear proliferation, but now you have to steal, man, the other side of the equation, which is well what were to happen if you were sitting there and you were Putin. Let's deal man, setting off a tactical nuke someplace, okay? I'm getting calls every other day from my two largest energy, buyers, India and China telling me slow my roll.
I have the entire world looking to find the final, excuse to turn me off and unplug be from the entire world economy. The only morally reprehensible thing that's left in my Arsenal that could do all of these things together will be to set off, attack nuke. I would be the only person since World War 2 to have done that.
I mean, you know, it seems like it's a really really really big step to take. And so I think that X of the clamoring for war that the military-industrial complex wants us to buy into the financial reasons to do it and the natural reason resources needs to do, it are making it very unlikely that is not just true for us.
I think it's also true for Europe. I think the European economy is going to roll over.
I think it's going, I see a very hard Landing for them, which means that if the economy slows down, there's going to be less need for energy. And so it starts to become a thing where a negotiated settlement is actually the win-win for everybody, but none of this would be possible without zero interest rates in a world of zero interest rates, we would be in war.
So you believe in the financial forces and pressures overpowering that I believe in the
humanness I really do believe in the
even in
international War more. So there I think the Invisible Hand and by the Invisible Hand for the audience, I think really what it means is you know the the financial complex and really the Central Bank complex and the interplay between fiscal and monetary policy is a very convoluted and
Placated set of things. But if we had zero interest rates,
We would be probably in the middle of it. Now,
see, there's a complexity to this game at the international level where the nation some nations are third Terrian, and are there significant code corruption. And so that adds a, from a game theoretic. Optimal perspective, you know, the invisible hand as is operating in the mud
preventing War.
The person the person that is the most important figure in the world right now is Jerome Powell. He is probably doing more to prevent more than anybody else.
He keeps ratcheting rates, it's just impossible. It's a mathematical impossibility for the United States. Unless there is such a cataclysmic moral transgression by Russia. So there is tail risk that it is possible. Where we say, forget it all bets are off. We're going back to zero rates issue, 100 year bond. We're going to finance a war machine. There is a small risk of that, but I think the propensity of the majority of outcomes is more of a negotiated settlement. So what about if you, what's the motivation of Putin to invade Ukraine in the first?
This financial forces are the most, the most powerful forces why did it happen? Because it seems like there's other forces of play of maintaining superpower status on the world stage. Yeah, it seems like geopolitics doesn't happen just with the Invisible Hand and
consideration. I agree with that. I can't back to. Now to be honest, I don't know.
But he did it.
And I think it's easier for me, to guess, the outcome from here. It would have been impossible for me to really understand it is what got him to this place, but it seems like there's an endgame here and there's, there's not much
playability. Yeah, I feel like I'm on the unsturdy ground because there's been so many experts at every stage of this that have been wrong, but there are no experts, well, on this,
I don't know, experts Lex. I understand this. Well, let's dig into that because there's some because we just said, Phil Hellmuth is, the is the greatest soccer player of all time.
He has an opinion. Yeah, he doesn't. He's still, he would be mistaken at poker. Phil has an opinion, Ivy has an opinion as well on how to play all these games. Meaning, an opinion means, here's the lines. I take your the decisions I make. I live and die by those and if I'm right, I win if I'm
wrong, I lose.
I've made more mistakes than my
opponent. I thought you said there's an optimal so aren't there? People that have a
deeper understanding
higher likelihood of being able to describe and know the optimal? The optimal set of actions here at every layer? Well
there there by being extra radically set of optimal decisions but you can't play your life.
Against the computer. Like meaning the minute that you face an opponent and that person takes you off that optimal path. You have to adjust
like what happens if a tactical nuke,
it would be really bad. I think the world is resilient enough, I think the ukrainians are resilient enough to overcome it, it would be really bad. It's just an, it's an incredibly sad moment in human history.
But do you wonder what you asked us? Is there any understanding? Do you think people inside?
United States, understand not, not the regular citizens, but people in the military. Do you think Joe Biden understands do you
think, I think Joe Biden does understand? I think that
I think they have a clear plan.
I think that there are few reasons to let the gerund talk or see rule. But this is one of the reasons
why I think they are better Adept than other people.
You know, folks that were around during the Bay of Pigs folks that hopefully have studied that and studied you know, nuclear
D escalation will have a better play book than I do. My suspicion is that there is a, you know, in an emergency break glass plan and I think before, military intervention or anything else, I think that there are an enormous number of financial sanctions that you can do to. Just completely
crippled
Russia that they haven't undertaken yet.
And if you couple that with an economic system in Europe, that is less, and less in need of energy, because it is going into a recession, it makes it easier for them to be able to walk away while the US ships, a bunch of, you know, LNG over there. So I don't know. The game theory on all of this, but does it make you nervous that or are we just being temperamental? Does it feels like the world hangs in the balance like
It feels like at least for my naive perspective. I thought we were getting to a place where Shirley human civilization can't destroy itself. And here's a presentation of what looks like a hot war or multiple parties involved in escalating, escalation towards a world war is not entirely out of the realm of possibility. It's not,
I would really, really hope that
He is spending time with his two young twins.
Well, this is part
of what I really, I really hope. He's spending time with his
kids.
Agreed but not kids, not just kids, but friends and the the Josh
project, he may not have friends. But it's very hard for anybody to look at their kids and not think about protecting the future.
Well, there's a partially because of the pandemic about partially because of the nature of power. It feels like you're surrounded by people, you can't trust more and more. I do think the pandemic had a effect on that to the isolating effect. Yeah a lot of people were not their best cells. During the pandemic foremost. Super heavy topic. Let me go back to the space where you're one of the most successful people in the world.
How to build companies, how to find, good companies, what it takes to find your company's, what it takes to build. Good companies, what advice do you have for someone who wants to build the next? Super successful startup in the tech space and, you know, have a chance to be impactful like Facebook Apple.
That's, I think that's the key word if your precondition is to start something successful, you've already failed because you're now you're playing somebody else's game. What success means is not clear.
You're walking into the woods, it's murky, it's dark, it's wet, it's raining. There's all these animals
about
there's no Comfort there. So you better really like hiking?
And there's no short way to shortcut that. So
isn't it obvious what successes like success is scale? Also, it's not what are the. No, I think that there is a very brutal basic definition of success that's outside in, but it's not. That's not what it is. You know, I know people that are much, much, much richer than I am.
You know, and they are just so completely broken and I think to myself, the only difference between you and me is Outsiders perception of your wealth versus mine, but the happiness and the joy that I have in the simple basic routines of my life. Give me enormous Joy.
And so I feel successful, no matter what anybody says, about my success or lack of success, there are people that live normal lives that have good jobs. That have good families. You know, I've had this like ideal extends, like I see it on Tick, Tock all the time. So I know it exists these neighborhoods where there's like a cul-de-sac in these beautiful homes in. These kids are biking around and every time I see that Lex I immediately
Lately flashback to what I didn't have and I think that's success. Look at how happy those kids are. So no you would, there is no one definition and so if people are starting out to try to make a million dollars, a hundred million dollars, a billion dollars, you're going to fail.
There's a definition of personal success but is there's also some level of, that's different from person to person. But there's also some level of
The responsibility you have if there's a mission to have a positive impact on the world so I'm not sure that you'll on is Happy. No
in fact I think if you focus on trying to have an impact on the world I think you're going to end up deeply unhappy
but does that matter like
why me happen first makeup in this matter? It may happen as a by-product but I think that you should strive to find your own personal happiness and then measure how that manifests as it relates to
Body and to other people. But if the answer to those questions is 0, that doesn't make you less of a person, no
100%. But then the other way is there times when you need to sacrifice your own personal happiness, Force for a bigger thing for that you've
created. Yeah, if you're if you're in a position to do it, I think some folks are tested Elon is probably the best example and it must be
Really, really hard to be him really hard. I have
Enormous levels of empathy and
care for him.
I really love him as a person because I just see that it's not that it's not that fun. And and he has these ways of
Being Human that in his position. I just think are so dire that if he never I just hope he never loses them. Just a simple example, like two days ago, I don't know why, but I went on Twitter and I saw the perfume thing so I'm like, ah, fuck it. I'm just gonna go buy some perfume. So I bought his perfume, the burnt hair thing. Yeah. And I said I emailed him, the receding of my, all right, you got me for a bottle and he responded in like 8 seconds and it was just a smiley face ruined over here.
Just deeply normal things that you do, amongst people that are just so nobody sees that, you know what I mean, but it would be he deserves for that stuff to be seen because the rest of his life is so brutally hard. He's just a normal guy that is just caught in this Ultra Mega Vortex.
Why do you think there's so few elon's?
It's an extremely lonely set of
trade-offs.
Because to your point if you get tested. So if you think about it again, probabilistically, there's eight billion people in the world. Maybe 50 of them, get put in a position where they are building something of such colossal importance that they even have this Choice. And then of that, 50, maybe 10 of them are put in a moment where they actually have to make a trade-off. You know, you're not going to be able to see your fam. I'm making this up. You're not going to be able to see your family. You're not, you know, you're going to have to basically move.
Into your factory. You're gonna have to sleep on the floor. But here's the outcome energy Independence and you know, resource abundance and peace and you know massive peace dividend.
And then he says to himself, I don't know that he did because I've never had this common. Yeah, you know what? That's worth it and like in the you look at your kids and you're like, I'm making this decision. I don't know how to explain
that to you. Yeah,
you want to be in that position. There's no there's no amount of money where I would want to be in that position. So that takes an enormous fortitude and a moral compass that he has. And that's what I think, people need to eat to appreciate about that guy.
It's also on the first number. He said, it's confusing. If there's 50 people.
Or 10 people like that are put in the position to have that level of impact. It's unclear. If that has to be that way, it seems like there could be much more
there should be, there's definitely people with the potential. But, you know, think about think about his journey, you know, his mom had to leave a very complicated environment move to Canada, move to Toronto, you know, a small apartment, just north of bay and Bluer. You know, if you've ever been to Toronto, I remember talking to her,
About this apartment is so crazy because I used to live like around the corner for that place and raise these three kids and just have to. So how many people are going to start with those boundary
conditions?
You know, and really grind it out. It's just very few people in the end that will have the resiliency to stick it through where you don't give into the self-doubt.
And so it you know it's a really it's just a really hard set of boundary conditions where you can have 50 or 100 of these people. That's why they needed to be really, they need to be really appreciated.
Yeah, well that's true for all humans that follow the thread of their passion and do something beautiful in this world that could be on a small scale or a big scale. Appreciation is a, that's a gift, you give to the other person but also a gift to yourself, that's somehow
Becomes like this contagious thing I
went to this you are so right. You just like it. My brain just let up because yesterday I went to an investor day of my friend of mine described Brad gerstner and you know, on the one very reductive World Brad. And I are theoretically competitors but we're not, he makes his own set of decisions. I make my own set of decisions, we're both trying to do our own view of what is good work in the world. But he's been profoundly.
Successful. And it was really the first moment of my adult life where I could sit in a moment like that and really be appreciative of his success and not feel less than. And so, you know, little selfishly for me but mostly for him as well. I was so proud to be in the room. That's my friend. That guy plays poker with me every Thursday. He is. Crushing it. It's awesome. You know and that's the it's a really amazing feeling.
I mean, to, to linger on the trade-offs, the complicated trade-offs, with all of this, what's your take on work-life balance in, in a, in a company that's trying to do,
Big things.
I think that you have to have some very, very strict boundaries, but otherwise I think balance is kind of dumb. It will make you Limited.
I think you need to immerse yourself in the problem, but you need to Define that immersion with boundaries. So if you, you know, if you ask me, like, you know, what is like my process look, like, it's monotonous and regimented, but it's all the time except when it's not and that's also monotonous and regimented. And I think that makes me very good at my craft.
Because it gives me what I need to stay connected to the problem without feeling resentful about the
problem, which part the monotonous, all in nature of it or the the when you said hard boundaries, essentially, go all out until you stop and you don't stop often.
I'm in a little bit of a quandary right now because I'm trying to redefine my goals and you're catching me in
moment, where
I have even in these last few years of evolution, think I've made some good progress but in one very specific way, I'm still very reptilian and I'm trying to let go,
which was exactly. If you
could knowing my business, it really gets reduced to. What is your annual rate of compounding? That's my demarcation. You know, Steph Curry and LeBron James Michael, Jordan. It's how many points did you average not just in a season?
But over your career, you know, and in their case to really be the greatest of all time, it's points rebounds, assists steals, there's all kinds of measures to be, you know, in that Pantheon of being really, really good at your craft. And in my business, it's very reductive. It's how well of you compounded. And if you look at all the heroes that I have put on a pedestal in my mind,
They've compounded, you know, at above 30% for a very long time.
As I've I, but now I feel like I really need to let go because I think I know how to do the basics of my job.
And if I had to summarize, I can investing challenge or investing, I think really. It's, you know, when you first start out, investing your a momentum person, you saw it in Game, Stop, just a bunch of people aping each other and then it goes from momentum to you. Start to think about cash flows. You know how much profit is this person going to make whatever? So that's like the evolution, you know, this is the, this is the basic thing to. This is a reasonably sophisticated way, then a much smaller group.
Up of people think about it in terms of macro geopolitics but then a very finite view crack, the special code which is there's a philosophy and it's the philosophy that creates the system.
And I'm scratching at that furiously, but I cannot break through and I haven't broken through. And I know that in order to break through, I gotta let go. So this is the journey that I'm in as in my in my professional life. So it is an all-consuming thing but I'm always home for dinner. You know, we have very prescribed moments where we take vacation the weekends you know like if I can tell you about my week if you're curious but it's like, I
would love, I would love to know your weak. It's since it's regimented him at all.
Monotonous. I woke up, I wake up at 6:45.
Get the kids, go downstairs. We all have some form of, you know, not super healthy breakfast. I make a latte. I'm become in and and the latte is like, I have a machine, I measure the beans, you know, I make sure that the timer is such where I have to pull it for a certain specific ratio, you know, just so you know, 20 grams, I got to pull 30 grams with the water and I got, you know, I got to do it in 30 seconds etcetera so your coffee snob, it helps me stay in Rhythm. Sure.
For. I used to have another machine. I just pushed a button, but then I would push the button religiously in the exact same way. You know what I mean?
Okay, okay. Actually, I'm on that topic. You know, the morning with kids can be pretty stressful thing. Are you able to find sort of happiness? Is that also that morning is a source of Happiness. It's great.
My kids are lovely. They're Maniacs. I just see.
See, you know? And maybe I don't I've never asked Freiburg this but I'll just put my words. I see all of the things in moments where
There was no compassion given to me and so I just
give them a ton
of love and compassion. I have an infinite patience for my children. Not for other kids. Of course. So anyway, so we have a breakfast thing and then I go upstairs and I go change and I work out from 8 to 9, and that's like the first 15 minutes. I walk up on a steep incline, you know?
twelve to fourteen percent, you know, three-and-a-half to four miles per hour, walk
And then, you know, Monday's of push day Tuesday's front of the legs, Wednesday's pulled, Thursday's back of the legs, 8:00 to 9:00 Monday. I always start, I talked to my therapist from 9 to 10. So as soon as I finished working out, I got on the phone and I talked to him and it helps me lock in for the, for the, for the week. And I'm just talking about the past, and it's just helping me.
Recent past. Usually sometimes the recent past but usually it's about the past past something that I remember when I was a kid because that's the work about just loosening those knots, you know. So I put in that hour of work, respect that our
Then I'm in the office and then it's like, you know, I go until 12:15 12:30, go home have lunch like a proper, like go home. Sit down have lunch with not talk. She leaves for work and we talk how we doing, you know, just check in our youngest daughter will be there because she's won and she's making a mess.
And then I'll have another
coffee. That's it. My limit for the day. Oh, no more caffeine, that's it.
And then I go back to the office and I'll be there till six seven sometimes. And I do that Monday Tuesday, Wednesday, Thursday, Monday, Tuesday, Thursday, Friday. I'm allowed to have meetings Wednesday. Nothing. It's all reading must be unless it's a complete emergency. It has to be kind of a full reading and reading is a bunch of blogs YouTube videos.
So now I'm trying not to do any talking.
No talking. It's like being in silence, being present, thinking about
things. By the way, how do you take notes? Give us
a sketch. I have a pad and I write stuff down. Sometimes I go to my phone, I'm a little all over the place. Sometimes I do Google Docs, I don't have it. This is one thing I need to get better at actually but typically what happens is I actually do a lot of thinking in my mind and I'm sort of filing a lot of stuff away and then it all.
Bill's out. And then I have to write and then that gives me a body of work that I can evaluate and think about and then I usually put it away and a lot of the time it goes nowhere. But every now and then I come back to it and it just unlocks two or three things and I have a sense of how else I'm thinking about things and then Friday at the end of the day not and I talked to a couples therapist and that's about checking out properly.
So it's like okay now it's like focusing the weekend is family, being present being aware, you know. And if there's email obviously if I have to do meetings from time to time. No problem. But there's boundaries checking out
properly. Oh man. That is so powerful. Just like officially transitioning.
Yeah. So these are these are really important boundaries.
He's so that I can be immersed and what that means is like look on a Saturday afternoon, you know, on a random day, she'll be like, where's your mouth? And I'll be up in my room and I've found a podcast talking about like desus, which is like ductal cancer in situ, because I've been fascinated about breast cancer surgeries for a while and learning about that. And she's like, what are you doing? I'm like listening to podcasts about Jesus and she's like, what's that about like, you know dr. Cancer in
situ
She's like, okay. And so, you know, I so I have time to continue to just constantly learning learning putting stuff in my memory banks to organize into something and that's like a that's a week. But then in these fixed moments of Time phone down everything down we go on vacation, you know, we go on a boat, we go to whatever where it's just us. And the kids,
is there a structure when you're at work? Is there a structure to your day? There's a meetings in terms of suicidal Wednesday.
Do you know because your
have your keep meetings to less than 30 minutes have to and you know oftentimes meetings can be as short as like 10 or 15 minutes because then I'm just like okay because I'm trying to reinforce that it's very rare that we all have something really important to say. And so the ritual that is becomes really valuable to get scale is not the ritual of meetings, but the ritual of respecting the collective time of the unit
And so it's like you know what folks I'm going to assume that you guys are also tackling really important projects. You also want to have good boundaries in this immersion. Go back to your kids and have dinner with them every night. It's not just for me, it's for you. So, how about this? Why don't you go and do your work? This beating didn't need to be 30 minutes, it could be five. And the rest of the time is yours and and it's weird, because when people join that system, as Social Capital, they just cook
It's like FaceTime and it's like let me make sure and let me talk a lot. And so again, say anything, I respect the person that says nothing for two years and the first thing that they say is not obvious, that person is immensely more valuable than the person that tries to talk all the time.
What have you learned from your? So after Facebook, you started social capital or what, what is now called Social Capital? What have you learned from all the successful investing? You've done there?
About investing or about life. Yeah, or bar running a team
if I'm very loath to give advice because I think it is so much of it is situational but my observation is that starting a business is really hard any kind of business and most people don't know what they're doing. And as a result we make enormous mistakes but I would summarize this in this may be a little paradoxical. I think there are only three kinds of mistakes because if we go back to what we said before,
In the business, it's just learning. You're exploring the dark space to get to the answer faster than other people. And those the mistakes that you make are three,
or the three kinds of decisions that same, you'll hire somebody and
They're really, really, really average, but there are really good person.
Oh yeah,
you'll hire somebody, and they really weren't candid with who they are and their real personality, and their morality and their ethics only expose them over a long period of time and then you hire somebody and they're not that good.
Morally. But they're highly performant. What do you do with those three
things?
And I think successful companies have figured out how to answer those three things because those are the things
That I my opinion determines success and failure
so it's basically hiring you just identified three failure cases for hiring
but very different failure cases and very complicated runs, right? Like the highly performant person. Who's not that great as a human being, do you keep them around? Well a lot of people would are towards keeping that person around. What is the right answer? I don't know. It's the context of the situation and the second one is also very tricky. What about if they really turned out that they were just not
It was who they are and it took you a long time to figure out who you were. These are all mistakes of the senior person that's running this organization. I think if you can learn to manage those situations. Well those are the real edge cases where you can make mistakes that are fatal to a company. Yeah, that's what I've learned over 11 and a half years honestly, otherwise the business of investing
I feel that it's like a it's a secret and if you are willing to just keep chipping away, you'll peel back enough of these, you know, layers will come off and you'll see at the scales will come off and you'll eventually see
it. I really struggle with, maybe you can be my therapist for a little bit. Well that first case, what you originally mentioned because I love people. I see the good in people. I really struggle with just a mediocre performing person who's, who's a
Good human being. That's a tough one.
I'll let you off the hook. Yeah, I didn't get. Those are incredibly important and useful people. I think that if a company is like a body, they are like cartilage. Can you replace cartilage? Yeah. But would you if he didn't have to know?
Okay, can I can I play Devil's Advocate? Yeah. So those folks because of their goodness
Make it okay to be mediocre.
They create a culture where well, we what's important in life, which is something. I agree. My personal life is to be good to each other. To be friendly to be good vibes. All that kind of stuff. You know, when I was at Google just like the good atmosphere, everyone is playing. And just it's fun fun, right? But to me like when I, when I put on my hat of like having a mission, a goal, what I
I love to see is the super stars that shine for some, in some way, like do something incredible and I want everyone to also admire that those Superstars and perhaps, not just for the productivity sake or performing or successful company sake. But because that
too
is an incredible thing that humans are able to accomplish, which is shine.
I hear you, but that's not a decision, you make, meaning you get
When you have those people in your company, that's not the hard part for you. The hard part is figuring out what to do with one, two and three. Yeah, keep demote promote fire. What do you do? And this is why it's all about those three buckets. I personally believe that folks in that bucket one as long as those folks aren't more than 50 to 60 percent of a company or good and they can be managed as long as they are 122 degrees away from one of those people that you just mentioned. Yeah.
Because it's easy then to drag the entire company down if they're too far away from the LeBron James because you don't know what LeBron James looks and feels and smells and, you know. So you need that tactile sense of what Excellence looks like in front of you. A great example is if you like, if you just go on YouTube and you search these clips of helped, Kobe Bryant's teammates described, not Kobe, but how their own behavior, not performance because there's a bunch of average people
people that Kobe played with his whole career, but their behavior changed
By being somewhat closer to him. And I think that's an important psychological thing to note for how you can do reasonably good team construction. If you're lucky enough to find those generational talents, you have to find a composition of a team that keeps them roughly close to enough of the Oreck. That way, that group of people can continue to add value and then you'll have courage to fire these. Next two groups of people and I think the answer is to
To fire those two groups of people because no matter how good you are that stuff, just injects poison into a into a living organism and that living organism will die when exposed to poison,
which will you invest in a lot of companies? You looked at a lot of companies, what do you think makes for a good leader? So we talked about building a team but a good leader for a company. What are the qualities?
You know, I when I first meet people, I never asked to see a resume.
And when I'm meeting a Company CEO for the first time, I don't couldn't care less about the business. In fact, and I try to take the time to let them reveal themselves. Now, in this environment you know I'm doing most of the talking but if this were the other way around and you are ever raising capital and use its mouth, I'd be interested in you. Looking at this business, I'd probably say eight to ten words for hours. You just listen prod. You know, I throw things out prod and
You Meander and a new Meandering. I'm trying to build a sense of who this person is. Once I have a rough sense of that which is not necessarily, right? But it's a starting point, then I can go and understand why this idea makes sense in this moment. And what I'm really trying to do is just kind of like unpack, where are the biases that may make you, you know, fail
and then we go back to you. The thing that Silicon Valley has the benefit of though is that they don't have to do any of this stuff, if there's momentum because then the rule book goes out the window and people clamor to invest. So one of the things that I do and this is again back to this pugilism that I inflict on myself, is I have these two things that I look at thing. Number one is, I have a table that says, how much did we make?
From all of our best investments. How much did we lose from all of our worst Investments? What is the ratio of winners? The losers over 11 years and in our case, it's 12:37 on, you know, billions of dollars. So you can you can kind of like you can see a lot of signal.
But what that allows me to do is really
like, say, wait a minute. Like
we cannot violate these rules around, how much money. We're willing to commit in an errant personality. You know, the second is, I ask myself of all the other top VC's in Silicon Valley, name them all, you know, what's our correlation meaning? When I do a deal, how often does anybody from Sequoia XL Benchmark liner, who named it?
It do it at the same time, or after and vice versa. And then, then I look at the data to see how much they do it amongst themselves.
What's a good sign. I'm at zero as
virtually close to zero as possible and that's a good thing. Well, it's not a good thing, when the markets are way, way up because it creates an enormous amount of momentum. So I have to make money the hard way. I have to, you know, because I'm trafficking and things that are highly uncorrelated
To the Gestalt of Silicon Valley, which can be a lonely business. But it's really valuable and moments where markets, get crushed because correlation is the first thing that causes massive destruction of capital massive because one person all of a sudden with one blow up in one company. Boom, the contagion hits everybody. Except the person that was you know not and so now those are like more sophisticated elements of risk management which is again
In this pugilism that I inflict on my nobody asks me to do that. Nobody actually at some level when the markets are up really care. But when markets are sideways, our own markets are down. I think that that allows me to feel proud of our process,
you know, but that requires you to think a lot a lot outside of the box. It's lonely because you're taking risks. Also your public personality. So you say stuff that if it's wrong, you get yelled at for constantly for for being
I mean, your mistakes aren't
private know and that's something that has been a really really healthy moment of growth. It's like an athlete. You know if you really want to be a winner you got to hit the shot in front of the fans and if you miss it, you have to be willing to take the responsibility of the fact that you bricked it.
And over time. Hopefully, there's a body of work that says you've generally hit more than you've missed, but if you look at even the best Shooters, what are they 52%? So these are razor thin margins at the end of the day, which is really. So then what can you control? I can't control the defense. You can't control what? They throw up me. I can just control my preparation and whether I'm in the
best position to launch a reasonable shot, you said that the world's first trillionaire will be
Buddy in climate change in the past. Let's update that. What's today as we stand here today, what sector will the world's first trillionaire come
from? I think it's energy.
Transition, so energy. So the things we've been talking about. Yeah, really? So, isn't it? Okay,
I think, I think the way that I think
about, so this is a single individual, sorry to interrupt you see their ability to actually build a company that makes huge amount of money as opposed to this distributed idea that you've been talking to
folks. Well, I'll give you my
My Philosophy on wealth most of it is not you.
An enormous amount of it is the genetic distribution of being born in the right place and blah blah blah. Irrespective of the boundary conditions of how you were born or where you were raised. Right? So you know at the end of the day you and I ended up in the United States, it's a huge benefit to us. Second is the benefit of our age. It's much better and much more likely to be successful as a 46 year old in 2023 than a 26, year old in 2023.
Because in my case, I have demographics working for me for the 26 year old. He or she has demographics working slightly
against them. Can you explain that a little bit? What are the demographics here
in the case of me, the distribution of population in America, looks like a pyramid. And in that pyramid, I'm wedged in between these two, massive population, cohorts, the Boomers, and then these, you know, gen Z and millennials.
And that's a very advantageous position. It's not dissimilar to the position that Buffett was where he was, you know, packed some packaged in between Boomers beneath him and the silent generation above him. And being in between two, massive copy population, cohorts turns out to be extremely advantageous because when the code word above, you transitions power and capital and all of the stuff you're the next person that's likely gets handed it. So we have a disproportionate likelihood to be, you know, we are lucky to be older.
Better than younger. So that's that's an advantage. And then the other advantage that has nothing to do with me, is that, I stumbled into technology. I got a degree in electrical engineering, and I ended up coming to Silicon Valley and it turned out that in that moment, it was such a transformational Wind of Change. That was at my back, right? So the wealth that one creates is a huge part of those variables and then, the last variable is your direct.
Contributions.
In that moment. And the reason why
That can create extreme wealth is because when those things come together at the right moment, it's like a chemical reaction. I mean, it's just crazy. So that was sort of part number one of what I wanted to say. The second thing is, when you look then inside of these systems where you have all these Tailwinds, right? So in Tech I think I benefit from these three big Tailwinds. If you build the
Company or part of a company or a part of a movement, your economic participation tends to be a direct byproduct of the actual value. That that thing creates in the world.
And that the thing that that creates in the world will be bigger, if it is not just an economic system, but it's like a philosophical system. It changes the way the governance happens. It changes the way that people think about all kinds of other things about their lives. So there's a reason I think why database companies are worth acts social companies are worth why but the military-industrial complex is worth, you know, as much
And I think there is a reason why that if you for example were to go off and build some new fangled source of energy that's clean and Hyper abundant and safe. That what you're really going to displace or reshape is trillions and trillions of dollars of worldwide GDP. So the global GDP is I call it 85 trillion, right? It's going at two to three percent a year. So, in the next 10 years will be dealing with a hundred trillion dollars of GDP.
Right? Somebody Who develops clean energy in 2035, will probably shift 10% of that around 10 trillion dollars.
A company can easily capture 30% of a market, three trillion dollars.
A human being can typically own a third of one of these companies. 1 trillion dollars.
so you can kind of get to this answer where it's like it's going to happen in our lifetime but you have to I think find the systems that are so gargantuan and they exist today it's more bounded because price Discovery takes longer and an existing thing it's more unbounded because you know what it is you know the tentacles that energy reaches right of that 80 trillion dollars worldwide GDP I bet you if you added up all the energy companies but then you added up all of manufacturing you know if
Repeal transport. You'd probably get to like, 60 of the 82,
have an idea of which energy, which alternate energy sustainable energy is the most
promising. Well, I think that we have to do a better job of exploring. What I call the suburbs of the periodic table. So, you know, we're really good in Seattle, you know, the upper Northwest, yes, you know, we're kind of good in Portland.
And but we're not existing in San Diego and we have zero plan for North Carolina through Florida.
Yeah. And so, is that a fancy way of saying nuclear is should be part of the
discussion? I think nuclear. I mean, room temperature, semiconductors, I'm not convinced right now that the existing set of nuclear Solutions will do a good job of scaling Beyond bench scale. I think there is a lot of complicated, technical problems that make it, work at a bench, scale level even partially but the energy
Equation is going to be very difficult to overcome in the absence of some leaps in Material
Science. Have you seen any leaps is are promising stuff. Like you're seeing The Cutting Edge from a company
perspective? Yeah. I would say not yet I but the precursor. Yes I have been spending a fair amount of time. So talking about like a new framework that's in my mind is around these room-temperature superconductors and so I've been kind of bummed
Laying around in that forest for about a year. I haven't really put together any meaningful perspectives. But again talking about like trafficking in companies and Investments that are very lonely but they allow me to generate returns that are relatively unique and independent. That's an area where I don't see anybody else when I'm there I'll give you another area. You know we I think are about to unleash in a world of zero energy and
And zero compute costs.
Computational biology will replace what chemistry and when you do that, you will be able to iterate on tools that we'll be able to solve a lot of human disease. I think like if you look at the head of like the top 400 most recurring rare diseases, I think like half the number 200 is see a specific point. Mutation is just a Miss methylation between C and T. I mean that's like whoa, wait you're telling me
Admit, billions of lines of code, I forgot it, you know, semicolon right there that's causing this whole thing to miss compiled, so I just got to go in there and boom and it's all done as a crazy idea. That was a C++ seen
it all back for people that don't know what I says to people who are
close to people there. But but
so that couldn't that be a truly, the source of all human computation, biology unlocks. I mean, obviously medicine is begging for
the thing with it.
See though, is that the groundwork is well laid and talking about sort of like the upper bound is well-defined. The upper Bound in medicine is not. Well, defined because it is not the sum total of the market cap of the farmer Industries. It is actually the sum total of the value of human life.
And that's an extremely ethical. And moral
question, is there a special interests that are resisting moving making progress on the energy side? So I like government and how do you break through that? We have to acknowledge the reality of
that, right. I think it's less government. In fact, like I said I think President Biden has done a really incredible job while Chuck Schumer really is that a really incredible job because so just to give you the math on this, right? Like back to this so 3% of that everything is
Is of a marketer zealots. But when you get past 5% things tend to just go nuclear to 50 60 percent.
The way that they wrote this last bill, the cause I'll just use the cars as an example. The cost of an average car is 22 and a half thousand, the cost of the cheapest battery cars, 30,000, and lo and behold, there's a seventy five hundred dollar credit and it's like to think the Invisible Hand didn't know that that math was. Right. I think is kind of a little bit Malarkey and so the battery EV car is going to be the same price as the thing and it's going to go to 40 50 %. So
We're already at this Tipping Point, so we're kind of ready to go in these other markets is a little bit more complicated because there's a lot of infrastructure that needs to get built. So you know the the gene editing thing as an example you know we have to build a tool chain that looks more like code that you can write
to Facebook is written and I think PHP original HP Envy which is I'm still a big fan of sometimes. You have to use the ugly solution.
And make it look good versus trying to come up with a good solution, which will be too late. Let me ask you, you consider a run for governor of California, then decided against it. What went into each of these decisions and broadly as have. Maybe a selfish question about Silicon Valley, is it over as a world leader for new tech companies as a this Beacon.
Of Promise of young minds stepping in and creating something that changes the world. I don't know if those two questions are
connected, so it's not, it's not over, but I think it's definitely weren't a challenging moment because
So back to that analogy of the demographics. If you think about the, like, if you bucketed forget like our relative successes, but there's a bunch of us in this mid 50's to mid 30s cohort of people that have now been around, you know, for 20 years, 15 years, to 25 years that have done stuff right from and recent assoc to Jack Dorsey, Etc, Ilan, you know,
Whatever maybe you throw me in the mix David Sachs whatever. Okay.
None of us have done a really good job of becoming a Statesman or a state's woman, you know, and really showing abroad empathy and awareness for the broader systems.
So Silicon Valley is to survive as a system. We need to know that we've transitioned from move, fast, and break things to get to the right answer and take your time if that's what it means. And so we have to be a participant of the system and I believe that and I think that it's important to not be a dilettante and not be thumbing your face to Washington or not push the boundaries and say, you know, we'll deal with it after the fact, but to work with folks that are trying to do the best again,
Steel, Man, their point of view, you know,
work with them. We don't you run for office. So potentially like be, you know, understand the system idiot, it's already makes, persist it makes me sad that. There is no tech people or not many tech people in Congress and certainly not in the presidential level, not many governors of senators. And
well I think that we also have roughly you know our rules will never allow some of the best and brightest folks to run for president because of just the rules against
At it. But you know if
I mean I mean like board in this, I think David
Sachs would be an incredible presidential candidate. Now. I also think he'd be a great Governor know he was born in South Africa, you know. I think he'd be a great Governor. I think he'd be a great secretary of state. I mean, he'd be great at whatever he wanted to do, you know, Friedberg, you know, wasn't born here. So there's, there's a lot of people that could contribute at different levels. And I hope that, by the way, the other thing I like about the Pod is,
I also think it helps normalize Tech a little bit because you just see like, normal people dealing with normal situations and I think that that's good, you know. It is a really normative place. It's not the caricature that it's made out to be, but there is a small virulent strain of people that make it care. Caricature like
what this in One Direction. What do you think about the whole culture of? I don't know if better terms but woke activism so serve activism.
Mm, which in some context is a powerful and important thing. But infiltrating companies
I'll answer this in the context of René Girard. So like he says that people tend to copy each other and then when they're copying each other. They're really, what they're fighting. What they're doing is you're fighting over some scarce resource.
and then you find a way to organize against, you know, the group of you against the person or thing that you think is the actual cause of all of this conflict and you try to expel them the thing that woke ISM doesn't understand is that unless that person is truly to blame the cycle just continues
And you know, that was a that was a framework that he developed that. You know, he's really conclusively proven to be true and it's observable in humanity and life. So these movements I think the extreme left and the extreme right are trying to interpret a way to allow people to compete for some scarce
resource.
But I also think that in all of that, what they don't realize is that they can scapegoat whoever they want but it's not going to work because the bulwark of people in the middle realize that it's just not true.
Yeah they realized but they're still because in leadership positions they're still momentum and they still scapegoat and it continued and it seems to hurt the actual body was opportunity for success, but it helps In
fairness though if you have to graph the effectiveness
Enos of that function. It's decaying rapidly. It's the least effective, it's ever been. You're absolutely right being canceled. Five years ago was a huge deal today. I think it was Jordan Pederson on your podcast. He said I've been canceled and it was amazing. He said 38 times or 40, he said some number, which was a ginormous number a that he kept a count of it and be was able to classify it. I'm like, what classifier is going on in his mind where he's like, that's an attempt to cancel me, but this one is not, but my point is, was clearly not working.
And so the guy is still there in the guys, you know, putting his view out into the world and so it's not what not to judge, whether what he says, is right or wrong, it's just to observe that this mechanism mechanism of action is now weakened. But it's weakened because it's not the thing that people think is really to blame. Yeah,
you've been cancelled a small scale if you times or it's not. So sure didn't feel small, actually wasn't small. I'm trying to minimize. Did that the
That psychologically hurt you. Yeah it's
tough. I mean in the moment you don't know what's going on but I would like to thank a certain CEO of a certain well-known company and he sent me basically like a step-by-step manual
and has an evolved mushrooms
though. No. And and he was right, you know the storm passed and life went
on, is it?
It out of, you can share the list of steps but is the fundamental core ideas that just life goes on.
The, the core fundamental idea is like you need to be willing.
And able to apologize for what is in your control, but not for other people's
mistakes,
your mistakes. Yes. And if you feel like there's something, then you should take accountability of that but to apologize for somebody else for something that they want to hear.
Isn't going to solve anything.
Yeah, there's something about apologies. If you do them, they should be authentic to what you actually want to say vs. What somebody else needs to wants to hear.
Otherwise it doesn't ring true
and people can see through that
and people can see through it. And also what people see through is not just the fact that you know your apology was somewhat Hollow but also that this entire majority of people now walked away the mob was like okay thanks. Yeah and then people are like
Also, you didn't care at all. This is like and so then it reflects more, probably on them. Yeah,
I know you said, you don't like to give advice, but what advice would you give to young person? You've lived an incredible life from very humble beginnings, difficult childhood and you're one of the most successful people in the world. So what advice? I mean a lot of people look to you for inspiration kids in high school or early college. They're not
Good or are trying to figure out.
Basically, what to do when they have complete doubting themselves, what advice would you give them?
It is really important that if somebody that you respect and I'm going to just for the purpose of this, put myself in that bucket. And if you're listening to this, I wish somebody had told this to me.
We are all equal.
And you will fight this demon inside you that says, you are less than a lot of other people for reasons. That will be hard to see until you're much, much older. And so, you have to find either a set of people far, far away like what I did or one or two people really, really close to you. Or maybe it's both that will remind you in key moments of
Of your life. That that is true. Otherwise you will give in to that Beast.
And it's not the end of the world and you'll recover from it. I've made a lot of mistakes but it requires a lot of energy and sometimes it's just easier to just stop and give up. So, I think that if you're starting out in the world, if you've been lucky to have a wonderful life and you had wonderful parents,
man, you should go and give them a huge hug because they did use such a service that
most folks don't do the most kids.
Unfortunately,
and it's not the fault of
Of these parents but it's just tough. Life is tough. So give him a kiss and then figure out a way where you can just do work that validates you and where you feel like you're developing some kind of Mastery, who cares? What anybody else thinks about it? Just do it because it feels good. Do it because you like to get good at something but if you're not one of those lucky people, you can believe in your friends or you can just believe in me. I'm telling you, preserve optionality.
How you do that is by regulating your reactions to things.
And your reactions are going to be largely guided in moments where you think that you are not the same as everybody else and specifically that you are less than those people and you're not. So just save this part of this podcast and just play it on a loop if you need to. But that is my biggest learning. Is I am equal. I'm the same as all these other people and you can imagine what that means to me to go out in the world to see people and think, okay, I'm the same as this person. I'm a
as good as them.
And you could imagine what you're probably thinking of what I'm thinking is not that thing, right? You're probably thinking, man, this guy. Yeah, this guy. I'm so much better. No, I am fighting this thing.
All the time.
Well, I've also met a bunch of folks who I think is a counter-reaction to that once they become successful, they start developing a philosophy than they are better. Or even some people are better than others. Which I understand, you know, there's LeBron James versus other people and so on. But I always really resisted that thought because I feel like it's a Sinatra's matter. They have Mastery in a thing.
That they fall in love with. Yeah, I'm trying to develop Mastery in a thing that I love.
You know, I love the, I love investing. It's like solving puzzles and I love that. I love trying to develop Mastery in poker. I really love that. I'm learning how to be a parent to a teenager because I have finally have one
It's all new stuff to me and I'm learning. That's what it's all
about. Yeah. So you don't want to think you're lesser than and you don't want to think you're better then because those both Lead You astray.
I've never thought I was better than I manifested better than
because I was trying to compensate for feeling less than my goal is just to feel like everybody else feels on the presumption that everybody had like a normal life. Giving your nickname is the dictator do trust yourself with power. Like if I if the world gave you absolute power for a month? No, no. Because I think that, you know, I'm still riddled with bias, I don't, I don't deserve that position. I don't, and I would not want that weight on my shoulders.
I had it. I had a spot actually where it was a very
Important in big poker game and it was a spot where I was in the pot and it was a really large pot is like a million dollar pot
and
I had to make a ruling and the ruling was in, in my favor and
I was just beside myself.
Because I don't play, I play for the challenge. I like to get pushed to the limit of my capabilities. I want to see can I think at the same level of these folks? You know,
because these guys are all experts, they're all pros
and I get enormous Joy from that challenge.
And I like to win but I like to win just a small amount, you know what I mean? And then I never wanted to win in that way but because it was, you know, my game I had to make this call on a million dollar pot and I wanted to
just shoot myself. I just was like, this is gross and disgusting and
and he was a complete gentleman.
Which made it even worse. So I do not want absolute power. What those are the people? You do
want to have power, is the ones that don't want it, which is a weird system to have because then you in that kind of system, don't get the leaders that you should have because the ones that want power on the ones that should have power, that's a weird weird system. What do you think? Let me sneak this question and that waiting is the meaning of life.
I don't know. Why are we here?
It woke up with the Stars and think about like the big.
Why question?
I think that it's a chance to just enjoy the ride.
I don't think it really like, I don't believe in this idea of Legacy that much. I think it's a real trap.
So, do you think you'll be forgotten by history? I hope so. I really, really hope so
because if you think about it, there are two or three people that are remembered for positive things and everybody else, it's all negative things and the likelihood that you will be remembered for. A positive thing is harder and harder and harder. And so the surface area of being remembered
Is - and then the second, what will it matter? I'll be gone. I really just want to like have fun do my thing learn get better but I want I want to reward Myself by feeling like well that was awesome. Like I've told this story many times and I have put again my own narrative fallacy on top of this but
You know, Steve Jobs is Sister wrote this you know obit in the New York Times when he died and she ends up by saying his last words were oh wow. Oh wow. Oh wow. That seems like an awesome way to die. You're surrounded by your friends and family. Not the fact that he died obviously, but in a moment where what I read into it was your family was there.
Maybe you thought about all the cool shit that you were able to do?
And then, you know, you just started the simulation all over again and so, yeah, just on the off chance. That that's true. I don't want to take this thing too, seriously. You know what I mean? Just enjoy it.
So you're not afraid of it. The end.
Again tomorrow, can I
right now?
So, everyday, you can go and you're happy. You're happy with the things you've
done. Yeah, you know, there, there are obviously things I want to do that. I haven't done.
But there are no gaping things.
I've really, really, really been in love total gift there have been moments where I've really, really felt like everybody else.
There have been moments, right? Deep deep deep joy and connection with my children. There are moments where I've had incredible giggling, fun with my friends.
There's moments where I've been able to enjoy, really incredible experiences. Wine food, all that stuff. Great. I mean, what more do you want? Like I could keep asking for more but I would just be a really crappy human being, at some point. You know what I mean? It's
enough. Yeah, yeah, it's enough. It's enough this life. This life is pretty beautiful. If you allow yourself to see it. Yeah,
it's really great and it's better than it's ever been.
For most of us actually pretty nice. You know, and all of the like, you know, Millennials and gen Z's, you're about to get a boatload of money from your parents and you better figure out how to be happy before you get that money because otherwise, you will be
miserable.
Get a lot of Dairy, Queen know that. Would that only work the first time?
It worked two times in grade 5 and grade 6 my God thanks to your Flex. I work my ass off. I'm like but I could never bring myself to ask her.
Yeah. And then she did it and I was like, man, that she's This Woman's of Miss. Bruni moon was a gym? Yeah, but the third time it faded isn't that the sad thing? My life you know the finiteness of it, the scarcity of it without that
We perhaps wouldn't ice cream would be so damn. Delicious your mouth, your incredible human. I definitely recommend that people listen to on. All all platforms just were very lucky to be able to get your wisdom. Eye injury. I agree with. I've talked a lot about you with other capacity, who is somebody I really respect and he just loves the shit out of you. You know, in how much you hug deeply understand the world. It's a huge honor. He's an incredible human being, so that's on a different. Yeah. Speaking of semicolons, there's some human beings.
That understand everything at the very low level and at the very high level and those people are also very rare. So it's a huge honor and also a huge honor that you would be. So kind to me, just like, in subtle ways Offline that you would make me feel like
I'm worth while, but can I just say something as just, a Layman listener, what you do, just so I could give you my version.
Is that you take things and people so ideas and people that are mostly behind a rope and you demystify it.
And what that does for all of us is, it makes me feel like I can be a part of that. And that's a really inspiring thing. Because it's, you're not giving advice, you're not telling us how to solve the problem, but you're allowing it to be understood in a way, that's really accessible. And then you're intellectually curious in ways that, you know, some of us would never expect that we were, and then you kind of end up in this rabbit,
And then you have the courage to go and talk to people that are really all over the map. Like, for example, like I, when I saw your Jordan Peterson example, like you went there like you talked about Nazism and I was just like man this is a complicated argument, these guys are going to tackle and it's just it's really, really impressive. So I have an enormous amount of respect for what you do. I think it's very hard to do what you do so consistently.
And so I look at you as somebody I respect because it's
it just shows like
somebody who's immersed in
something it was
Very special. So thank you for including me in this. I'm going to play that clip to myself privately over and over just think when I feel low and self-critical myself, thank you so much brother.
Thanks. Thanks man.
Thank you for listening to this conversation, which a mothball have Bhatia support this podcast. Please. Check out our sponsors in the description. And now let me leave you with some words from Jonathan Swift. A wise person should have money in their head but not in their heart.
Art, thank you for listening and hope to see you next time.
