Heidi Roizen (What makes a ‘great’ entrepreneur?)

In this episode of the Judgment Call Podcast Heidi Roizen and I talk about:

  • Which role Stanford University played in Heid’s life personally and how much of a role it has in spawning entrepreneurship.
  • Why entrepreneurship is such an important tool to change the world (to the better).
  • What are the motivations for entrepreneurship? What skills and values pay off for entrepreneurs?
  • Are the public market in a state of irrational exuberance?
  • Is the big stagnation is real in entrepreneurship? Have we let go of our own high expectations to improve?
  • How the ‘baby boomers’ have corned the real estate market and why the millennials have trouble following the ‘boomer model’?
  • Where does Heidi stand in the Miami vs San Francisco debate?
  • Do we live in a simulation? Will we be able to upload ourselves into a silicon based lifeform?
  • Will we be able to ‘rebuild’ our ancestors from their DNA?
  • Are first time entrepreneurs or ‘wise’ serial entrepreneurs the better choice?
  • How is religion linked to entrepreneurship?
  • How would ‘free energy’ change our life?

Watch this episode in 4K resolution on Youtube – The Judgment Call Podcast Episode #38 – Heidi Roizen (What makes a ‘great’ entrepreneur?).

Heidi Roizen is a venture capitalist at Threshold Ventures, former entrepreneur and Silicon Valley evangelist. She also actively mentors new entrepreneurs.

You may reach Heidi via LinkedIn.


Welcome to the Judgment Call Podcast, a podcast where I bring together some of the most curious minds on the planet, risk takers, adventurers, travelers, investors, entrepreneurs and simply mindbogglers. To find all episodes of this show, simply go to Spotify, iTunes or YouTube or go to our website judgmentcallpodcast.com. If you liked this show, please consider leaving a review on iTunes or subscribe to us on YouTube. This episode of the Judgment Call Podcast is sponsored by Mighty Travels Premium. Full disclosure, this is my business. We do at Mighty Travels Premium is to find the airfare deals that you really want. Thousands of subscribers have saved up to 95% in the airfare. Those include $150 round trip tickets to Hawaii for many cities in the US or $600 life lead tickets in business class from the US to Asia or $100 business class life lead tickets from Africa round trip all the way to Asia. In case you didn’t know, about half the world is open for business again and accepts travelers. Most of those countries are in South America, Africa and Eastern Europe. To try out Mighty Travels Premium, go to mightytravels.com slash MTP or if that’s too many levels for you, simply go to MTP, the number four and the letter U.com to sign up for your 30 day free trial. I’m here today with Heidi Reusen and Heidi is a venture capitalist at Threshold Ventures and she used to be an entrepreneur before that in the 80s and the 90s and is now also a Silicon Valley evangelist and an entrepreneurship mentor. Welcome to the Judgement Call podcast. How are you? I’m good Torsten. Thank you for having me. Absolutely. Heidi, thanks for doing this. I know you’re really busy and you have a busy speaking schedule as well so I really appreciate that and I think we have a bunch of really interesting topics coming up. One thing that I noticed when I was looking into your Wikipedia entry actually, congratulations on this. Not a lot of people have their own Wikipedia entry and what I noticed is there’s Stanford everywhere so apparently you grew up in Stanford, California, I’m not sure if Wikipedia got that right. I didn’t even know and I used to live in Palo Alto, there’s a Stanford, California then you did your undergraduate degree in Stanford, you did your MBA in Stanford, now you teach at Stanford, right? I do, yes. How did that happen? Well, I guess I just can’t leave my local town, right? I mean, I guess I haven’t been very upwardly mobile as they say but no, I’ve lived in the Stanford area most of my life and as you say I went there undergrad and grad school and about 10 years ago some friends of mine who had left tech and entered the world of teaching asked me to come and teach a course there and I thought that sounded like fun so I started teaching at class on entrepreneurship and that ultimately evolved into a graduate scholarship program that I now teach there and we’re going into our I think eighth year now so it’s a great program. We pick students that are all coming out of STEM programs so computer science, aero astro, mechanical engineering, electrical engineering, their master’s students and hand selector, a handful of them, this year we have 15 of them and we put them through about a six month intensive course on entrepreneurship as well as Stanford. You know what? I used to live in Palo Alto but I never went to Stanford so I missed out on that experience. I applied actually for an MBA a long, long time ago. I was rejected obviously and much to my discontent but I got to see quite a bit of the Stanford infrastructure the last 20 years by my living Palo Alto in San Francisco and one thing that I didn’t even know existed is that there’s a course for entrepreneurship, right? I was talking to Peter Bordes about that and we were actually unsure, maybe we should have looked it up. What we felt is there is a lot of, the knowledge of entrepreneurship is something that seems to be strewn all over common experiences a little bit of in the religion, there’s a little bit in science, there’s a little bit in modern culture. It’s all over the place. It seems to change a lot and we always, we felt that’s something that I’ve been nurturing in this podcast. There should be like a chorus, a canon of entrepreneurship lessons. So what do you actually teach? What do you feel belongs into this canon? Well I, you know, in order to teach entrepreneurship the first thing you have to believe is that entrepreneurship can be taught. So I think that while there are some inherent abilities that people who have an entrepreneurial bent have, whether that’s tenacity as a trade or a growth mindset, which I think are two very important things for being an entrepreneur, I do actually think being an entrepreneur can be taught just like you can teach someone to swim who doesn’t know how to swim, doesn’t necessarily mean they’re going to win the Olympics, but if you can take somebody from a certain level and take them up a level. And I think that at the fore, entrepreneurship is creatively bringing something into existence that didn’t exist before and growing and that can be done whether you’re an entrepreneur, whether you work inside a corporation, whether you do that around a hobby or a passion or something with a humanitarian focus. There are all sorts of different ways to do something entrepreneurial, it doesn’t necessarily mean that you have to do the Silicon Valley startup and raise it to capital. In fact, I sometimes feel like around Stanford, there’s almost this disease about tech startups. You’ve got to do a tech startup and you’ve got to raise VC and if you don’t do that, you’re not doing the right thing. I think for most of the world, the Silicon Valley model of entrepreneurship is not the prevailing model, more so than being more disappointingly and there are many different ways to be an entrepreneur. You’re speaking from my heart, I’ve been preaching the same thing, that there is a Silicon Valley model in the sense of it is kind of an archetype, this is like the best possible outcome. If you take a religious parallel, it’s somewhere like you’re going to be a high priest, you’re going to be as close as possible to God. But that’s actually the absolute exception, the idea is that we all improve ourselves and entrepreneurship in my definition is we improve ourselves because we deliver a service or a product that other people find so valuable that they will pay for it or it’s slightly better than whatever they pay for right now. So it makes everyone better off because everyone relies on these voluntary transactions and indeed I feel 99% of this is really developing an entrepreneurly attitude, basically looking out for entrepreneurly opportunities everywhere in the world. When I came to the U.S. 20 years ago, I felt there were so many opportunities, I grew up in Germany and then I came over in 2002, 2003, I felt like oh my gosh and even after.com bobbled, there’s just so many opportunities but someone has to kind of have an eye for those right, a lot of my friends and a lot of my family, they couldn’t care less about it even if I told them about it right, it’s not something they felt is worth doing creatively or structurally, sometimes it’s just a process that you improve on, it’s a better marketing, there’s a lot of avenues and I always felt it’s this and it’s probably what you teach and I find this so fascinating, it’s developing an eye for the specific art in the world and once you have this, you can literally go from there, you won’t be as you say, win the Olympics but everyone can do entrepreneurship, maybe a little more, a little less successful but everyone can have their own business at least for a part of their life and maybe create an app. I think we’re in a real golden age of opportunity for entrepreneurship, when you really think about it, whether it’s sites like Etsy, being a small seller on Amazon, even the gig economy creates many entrepreneurs out of people, admittedly there’s inherent questions about how people are properly compensated and all those sorts of things and I’m not belittling those but I think there are many ways for you to creatively have ways to make a difference, make money, save money, do all of those things and so adventure is such a small part of that, I think there is so much opportunity and I don’t think that for most people I don’t think that starting the big company that you’re going to take public and be on the cover of magazines is even the goal, I mean that’s not something that everybody wants to do, I know a number of people who are, what some people refer to as a lifestyle, they decide this is the area I want to have an impact, this is how I can figure out how to make my money, I can make enough money to support myself, some of the people who do this do it in quite a nice way, supporting themselves and that’s their goal, that’s their life goal, so I think one of the important things and it’s something we as investors try to find out from entrepreneurs all the time which is why are you doing this? What is your goal? Because generally speaking if it’s just your goal is to be famous and make a lot of money, it’s not usually a very good motivation to keep you going. But you know what, I talked to Rob Matzkin who runs Education Startup now and my thesis is basically, I say entrepreneurship is making the world a better place by going through somewhat odd loops, by going through making money, by being very capitalistic, by being a shark so to speak, but you still make the world a better place, what do you think is the majority of motivation to be an entrepreneur and what is like the best one, when you look out for entrepreneurs that you would bring in and nurture as a venture investment, when do you say okay this is a motivation and it seems realistic that you feel is in the top three? Well, I think the first of all that like I said when people just want to be an entrepreneur because they think it’s sexy or they want to make a lot of money, I think a lot of people suffer from the, how would I call it, the overnight sensation idea that entrepreneurs, you really are biasing towards the success stories because that’s what you hear about, you don’t hear about all the failure stories where it didn’t go right, right? And 95, I think this number is something like 95% of companies still fail, right? This is not, this is a very high risk endeavor and to make it to the uniform outcomes those are very, very rare outcomes, so first of all be realistic about what your potential outcome might be. I think that the best entrepreneurs have a deep passion to solve a particular problem, right? And when we meet up with entrepreneurs, we’re doing a lot in healthcare right now and one of the things I find most compelling is very often what her has a form of origin story that involves themselves or a loved one suffering from a healthcare issue and whether it is the disease itself or whether it is the process of trying to resolve the disease, whether that’s various forms of addiction or pain or obesity or other forms of health, these are people who face the issue themselves and realize that the current system wasn’t in their needs and it really compels them to go out and create a solution. And I think in many ways you need that kind of motivation if you’re going to be an entrepreneur because being an entrepreneur is really, really, really hard and you face a lot of setbacks and you go through a lot of difficult times and if you’re not intrinsically motivated to solve the problem, it’s just too easy to give up. Yeah, absolutely. I mean, I’m on to startup number seven now that is like a startup where I have other investors in and I feel, I don’t know if you’ve probably watched the TV show Silicon Valley which illustrates this really well that they go from being millionaires to being literally being unemployed and having nothing to eat and then that goes on for a little bit and then they become billionaires and that’s how I always feel in my startup. So my first startup went from nowhere to being worth a couple of billion to be worth nothing within a couple of months and I’m like, holy smokes. I couldn’t even comprehend what was going on and I couldn’t comprehend so many external factors that play a much bigger role than what I do. I was important and in my mind I was young, obviously I was very important, right? I had a huge ego but I think a lot of this came from external events which you can’t control over. There’s interest from the VC community because they feel it’s going to be great but then two years later when you actually have a product, this might be gone and they feel, oh, this sector is terrible because something happened, there’s a bunch of startups that went bankrupt. So VCs won’t touch it for another two years or five years and you have a product ready to ship but you can’t build it because there’s nobody there who wants to finance you, at least when you really focus on VCs. It has so much going on that I think you’re absolutely right, I fully agree. If you do this for the money, then I wouldn’t say it’s a bad thing to do it for the money but you don’t have any control over the money part. That’s the big problem. You don’t know what your customers do or your investors do. I mean, let me break in because I’m not saying that making a lot of money is bad, right? I definitely hate to have venture capitalists. We owe it to our limited partners, right? We’re trying to back entrepreneurs who are going to make a lot of money. That is our business model. That said, it should not be one primary motivation. I think of making money as almost the byproduct of doing something important, right? Money is America’s way of keeping score and so there is an attribute of that. I do think that you brought up something really interesting. First of all, this art of going from being worth nothing to being worth millions or billions to nothing, that is really weird, right? That is not normal. Most of the world does not operate like that. Again, and I’ll use Silicon Valley, whether you want to call it a physical location or just a state of mind, those kind of things happen in Silicon Valley. It didn’t happen almost anywhere else in the world, right? It’s not real. I also think people lose sight of what money really means sometimes. I’ve talked to people who had to put themselves through school, who have no income, who do a startup and they have the opportunity at 27 years old to cash out and make $5 million and they’re disappointed because $5 million is not a lot of money. I was just looking at some study that came out today that $5 million puts you in the one percent of wealth in America, right? I mean, it is not no money. It’s just that people develop a very warped sense of what money means and so I just do, I encourage entrepreneurs, again, nothing wrong with wanting to make money. If you want to go for it and either make it big or go broke, and obviously, as venture capitalist again, we don’t make a lot of money when entrepreneurs sell out early and cap the upside, right? We want to take things for the long haul, but I just would encourage every person individually to really think hard about what do I want to do? What is enough for me? What is a good outcome? What would be meaningful to the people I care about? It doesn’t mean that everyone needs to go on this incredible trajectory. One more point about that, and I think this is, again, a danger in the way we celebrate entrepreneurs, it’s kind of the downside of the way we talk about entrepreneurial success in terms of money, is let me tell you the tale of two stories. Let me tell you that you bought stock at $10 a year ago and today you can sell it for $25. Are you happy or sad? You’re happy, right? Yeah, yeah. Okay, now let me tell you that six months ago that stock was worth $500. Now are you happy or sad? Yeah. I will be suicidal. Okay. All right, it’s like the Bitcoin story. I think this fear of missing out is very hard to overcome. It’s socially such a disappointment because money, I mean, I was rereading Ars Total this morning, and he was dismissing money as a virtue right away. He’s like, everyone who’s just interested in money is completely, he’s not a virtuous man, right? Virtue, not what we think of virtue now, but for him it was the fulfillment of what you should seek in life. And he was dismissing this right away that money plays a role, right? But it isn’t the sole goal, it can never be. And I think we have the social factor of what money is this proxy of admiration of social status, of delivering your role, of providing your role to your family, right? The problem is way bigger if you would have been much richer a while ago, and I think most people, 99% would be so disappointed about the losses, and it’s, it’s, it’s weird to how our brain works, but the losses would be so devastating that nobody would enjoy this, this upside. I mean, at least all the entrepreneurs I know, so it is a really weird way, like entrepreneurs are motivated by money, but it’s actually not money what they’re seeking, there’s something else behind that. And I think that sometimes, and I understand we all want to make money, we need to make money, and this is all perfect. But there is, when we look into the real motivations, it’s probably something else that happens there, and we’re just looking, I think both sides, when we say both sides, venture capitalists and entrepreneurs, we kind of look at this a little bit. I think maybe we are too afraid to ask the real questions, because it gets too personal. I don’t know. I mean, you’re the expert. I mean, we’re going into, you know, we can go, we can go full on philosophical about this, because that’s where we’re really going here, because I think that there’s so much about being an entrepreneur that it just becomes the meaning of your life, it becomes the focus of your life. I think it’s really hard to be, you know, an entrepreneur who doesn’t care a lot about what they’re doing. The best entrepreneurs care deeply about what they’re doing. And in order to do that, it does become who you are. So the question is, does it become who I am, because my goal is very important to me? Like take a company we’re investing in, Memphis Meats, we’re doing cell based meat, which is because getting a lot of attention right now, in part because of Bill Gates’s book on climate change and the existential crisis we face as humanity. And the devastating role, the regular way that meat is produced is having on climate. And when you look at that, you take the CEO of that company, the founder of that company, Uma Letti, he’ll probably be worth, I predict he’s going to be a billionaire in the future. He is not doing it to be a billionaire. He is doing it because he is a great, he is a massive animal rights, or cares about animal rights, right? He saw an animal getting slaughtered when he was like 11 years old and became a vegan and has never touched meat since then. And he deeply cares about the earth and climate. And so he’s doing it because he cares about those things and he wants to allow people to eat meat without harming the environment, or without dramatically reducing the harm of the environment. If he makes money off of it, great. But one of the things you said that was really interesting is, like, I think all of us have a relationship with money, right? And it means different things to different people. And so I would argue, you know, for me, I think of money in two ways. I think of it as resources. I can marshal resources to do things with money. And I think of freedom. I can buy freedom with money. I can alleviate tasks, and I can have experiences, and I can do things with money. If you think of money as defining your self worth, and if you use rankings of, you know, the richest people in the world to determine your own self worth, I would just argue that you’re going to have a happy life because for most of you, there are going to be people with it. There’s always going to be somebody about to do. And I also have the good fortune of knowing some of the richest people in the world. And I would argue beyond a certain amount of money, extra money doesn’t make you that much more time spent. It’s life doesn’t really work that way. I’m fully with you. But on the other hand, when I listen to my heart in the sense of what’s going on in my subconscious, it tells me more is better, right? If I listen to philosophy, then I see what Aristotle is saying. I see what you’re saying, right? I fully agree that there’s a limit to consumption, and that’s I make this argument publicly. But if I wake up in the morning and just people ask me, okay, what would you want to do? And say, okay, a few billion more, I wouldn’t be so bad, right? And that’s something instinctive about, you know, we want to hunt the bigger animal. We want to go to the bigger, to another undiscovered land. We want to go to Mars. We want to go out the side of the solar system to something strange that someone put inside our brain. And that kind of drives us, and I think money is just one of those proxies that can probably foresee the amount of land you had or the length of your railroad. But by the way, one of the things you just said, for example, you know, when Elon Musk decided to start SpaceX, right, because he wanted to go to Mars, he knew that was a lot of money. It was going to cost a lot of money. And so he had to figure out a business model that would allow him to also raise a ton of money to go to Mars, right, to build Memphis needs, it’s going to cost hundreds of millions of dollars to do the technology and build the factories. And so when I talked earlier about resources, one of the things is if you individually have a goal, because you want to make some kind of massive change and it requires a lot of resources, yes, you do have to care about that because certain things are not achievable on small amounts of money, they take bigger amounts of money. So again, I’m not dismissing that. Yeah, that’s where you guys come in, right? I’m very curious. So I know you used to work with Draper Fisher Gerwitzen and then you spun out threshold. I didn’t know that it was used to be part of Draper Fisher Gerwitzen, which I think is a huge, huge brand name in the industry. And one thing that I noticed, you also worked for SoftBank at some point, right? And then it became something else. And I’ve been lamenting about SoftBank here on this podcast because I felt a day for a while and things have changed the last six months again. So maybe it was just a lamenting at the time. But I felt SoftBank kind of took over this IPO market. They kind of went into certain startups, dropped a few billion dollars, made them the virtual monopoly because nobody else could do anything about that amount, could compete with that amount of money, and then would bring the startup public two years later. Now it would be like two months later in an aspect. How do you feel has become of SoftBank? Do you think it’s true to its origins? How do you feel did it evolve since the time you’ve left, right, since it’s been a couple of years? Right. So I worked for SoftBank. I worked really, we had a venture firm that SoftBank was our main LP and that was 20 years ago. So it’s been a little while. But I would say that SoftBank is the manifestation of Masa Yoshisome and Masa has not really changed. He has always been a person who’s focused on the very long term. He is a person who has extremely high tolerance for risk. He loves entrepreneurship and he likes to go big, right? And so if anything, I would say he’s just the same as he was 20 years ago. I think that certainly SoftBank has been a company that has evolved through good times and bad. It would be interesting to rack up the amount of money Masa has lost and won over the last 20 years and the number of times he’s stated down to it, you know, last billion. I would not have the internal fortitude to do that myself. I don’t have the risk curve he’s got. But I look at what they’ve done and, you know, look, I don’t agree with all the decisions they’ve made. I don’t agree with everything they’ve backed, but you can’t argue with the success. I think it’s wonderful for the world that you have people, you know, like him who are willing to think big on certain things. And you know, and by the way, Memphis Meats, the company that I mentioned earlier, SoftBank led the last round in Memphis Meats. So I’m personally appreciative that they saw the same vision we did in terms of in terms of that. I’m, you know, look, I think this is an amazing renaissance time to be an entrepreneur. I think the world needs a lot of technological breakthroughs. And I think it’s wonderful that there’s so much capital in the market to fund the best ideas. And I think SoftBank plays a big role in that. Yeah, I wanted to ask, I wanted to ask you about that later, but I think it is something that that is really important and explains probably your philosophy very well about what you do. Do you think there is too little, too much entrepreneurship in general? And let’s, let’s just do in particular in Silicon Valley. And then what about the public markets? Do you feel we have an amania going on or do you think things are going to work out in 10, 20, 100 years? What’s your gut feeling on all those, those quite important measurements? So as long as some people don’t mind losing, I’ll never say there’s too much entrepreneurship. I think entrepreneurship is has so much going for it. It’s such a great way to solve problems, big problems. It’s a great way to take risks. And certainly in Silicon Valley, we have a whole economy and ecosystem built around it. So if you ask me, you know, would I rather have less, I’m never going to want less entrepreneurship. I do think there’s a lot of capital in the market right now. And sometimes when there’s a lot of capital in the market, companies get funded that don’t really have a viable long term and some of those companies are going to lose and the money’s going to be lost. But overall, we’re still going to move forward. I mean, if you look at the dot com and boom and bust, you think about not only some of the great companies that came into fruition during that cycle, but you think about the massive amount of investment that went into internet infrastructure that the next wave of the economy was built on, even though many of those investments probably didn’t work for the people who made them, if we benefited as that’s humanity, we benefit it. And, you know, again, we’ve got some major, major problems to solve. I do think when you’re in the business of investing money, you know, the famous adage buy low and sell high. And when there are a lot of other competitors for what you want to buy, i.e. early stage companies start, prices go up. And so your business model has to work on less of a delta between your buy and your sell. Now, right now the capital markets are crazy, right? There is no economic justification. I was talking to someone who has obviously shares in a recently public company and he was asking me whether I would evaluate whether it’s a fair price or not. I said, look, there is no economic justification for that valuation, but I also could tell you in my double in the next few months. I don’t know. Right? And it’s kind of funny, I’ll boil it down to the simplest thing, right? I mean, look at GameStop. Like, if you just watch something like GameStop and just think, it makes my head go nuts to look back because there was no fundamental reason for that stock to be the price it was. But yeah, some people will have made a lot of money if they bought and sold at the right time. I think with Venture, you’re buying and selling delta of time is usually seven years. And so you really are, you’re not playing the market, you’re counting on equity to mature and grow because the fundamental business proposition is to grow. My own feeling about the current market is, hey, if they’re handing out money left and right and you have a business opportunity that can capitalize on deploying that money, go ahead and take it and try to make it work. But as an investor myself, I have to look clear eyed and this goes back to that point about your expectations and what are you trying to accomplish? If you’re trying to accomplish a certain amount of return on your capital and all of a sudden you end up on one of these massively overvalued stocks, well, you can either sell it all and just take your wins and then you might have FOMO or RealMo, whatever it is, you might actually miss out on even more ridiculous upside because ridiculous upside still happens or you can sell half and keep half, which for me is a very pragmatic thing to do, but it’s funny because whichever, if you sell half and buy and keep half, you’re going to be half wrong no matter what you did, right? Or you can keep it all and hope that it keeps going up and up and up, but if it comes crashing down, you’re going to really miss all that paper game made. And so I just think so much of this has to do with A, your motivation and B, your own human nature. Heidi, we have to find something we can actually disagree about. So far we agree on everything. I couldn’t have said it any better. I couldn’t have even tried. One thing that I find really interesting and living through the 2000 bubble, there’s a bunch of YouTubers who go out with these videos where they basically describe how you just sold the house and they put it all in two stocks or it’s usually Tesla or Bitcoin or Dogecoin. You know, there’s a couple of different, it used to be GameStop a couple of weeks ago and now it’s not so hot anymore or American Airlines. And it’s not just that they’re putting $300,000 in the stock and go long, so to speak, they’re buying options. They’re buying call options, which if the price doesn’t move, they expire, if it goes down, they don’t make any money. So it has to jump in the next two months or you’re in trouble if you buy particular kinds of options. So there’s a lot of Robin Hooders who just play it with $2,000, I think that’s the majority. But some people are, they feel like this cannot go wrong. I mean, something is going on. That reminds me of 2000, that was 2000, right? You would go into any IPO because it was guaranteed to pop multiple, a couple of times, to the initial price. And then 12 months later, most of these companies were gone, 24 months later, which was really odd. So it seems kind of similar to me. But one thing, and I think you’re absolutely spot on there, I feel entrepreneurship is the self fulfilling prophecy, right? So it’s almost like the, if culture sets out to say, we want to go to March, we want to go to the outside of the solar system, and we have these high expectations of ourselves that we very often can’t do it. So we will fail, we will fail, but eventually we get a ride. It might take a couple of years or a couple of decades. But I think what happened, and that’s, maybe we can disagree on this finally. So it’s Peter Thiel’s thesis, right? So it’s this stagnation. And he was, he said, you know, we have this stagnation outside of the semiconductor industry. And I would go beyond, and I feel we had this stagnation in total entrepreneurship. And he was presenting a couple of different theories why that is. And my theory is, you know, what happened is we haven’t set ourselves such high goals for the future. We have innovation, and we have numerous innovations, but we, they all are related to one core field. And maybe that’s going to eat the world. Maybe that is another answer. What I’m trying to say is we haven’t challenged ourselves enough the last 50 years. That’s why I think we have a big stagnation. But if you change this, and kind of entrepreneurship, and what’s going on in the public markets is kind of this, we loan ourselves money for the future generation, and if technology can come up with productivity growth, it’s going to be fine. We’re not going to make our kids and our grandkids poor. We’re going to make them super rich. But for this, we all have to, like, push forward in that sense that we all raise our expectation and then struggle to make it happen. And I feel like the last 50 years, we were more like concerned with living well and not making things well. Do you share this sentiment? It’s a great question. And I think there are many threads of truth in what you just said. I think there has been a culture that was, it was about living well. It was the American dream that, you know, whatever it was, a chicken in the pot, two cars in every garage. And then it was a computer on every desktop, which actually I could argue was probably the greatest advancement for overall potential for equality that’s ever been done, you know, the internet and the ability to tap into knowledge at an almost zero cost is really incredible. So I would not say that the last 50 years, we haven’t seen enough innovation and advancement. But I would say that there are, you know, let’s face it, if you look at the greatest wealth creation, it has been almost all tech, it’s been largely software. And so if you flip that around and say, if you’re a professional investor, you know, I, as a professional investor, my limited partners didn’t tell me to go make the world a better place. They told me to go and make money for them. And if we see that a certain area, it’s a lower risk and higher return to make money by software. And with the history of IPOs and all of that, a lot of wealth creation has happened in terms of primarily software, then that’s where the money goes and that cycle continues. I think that’s what is really interesting right now, though, is that we are broadening, that when you look at something like a Memphis Meats or you look at all the money that’s going into EVs, autonomous vehicle, things like Joby Aviation, I mean, these are big risky bets, right? Joby is not a slam dunk, and it’s already has a massive valuation, but it’s a super interesting, fascinating technology. I think that when you look at, and again, I cannot recommend enough Bill Gates’s book, it’s sobering, but it’s very important read for everyone. When you think about the, what we are going to have to do in terms of food and energy and the innovation that’s going to have to happen there, it’s not only is it a massive opportunity and money will be made, but it is literally an existential crisis. And so I do think we’re going to see, I think we’re going to see it turn. I certainly believe, you know, again, I work with all generations of people. I think my generation, you know, I’m in my sixties. I think we got maligned as the bad baby boomers who didn’t care about the resources and maybe that is true in many ways, but I would also argue that some people like me are actually trying to move things in the right direction and make investments and put our personal time things that will change that dynamic. I certainly see when it comes to young people, I mean, I have kids who are in their twenties, they’re much more focused on what’s good for the earth and what aligns with their ethics and morals and all those things than I think one might argue of the generations in between. And so I think we’re going to see a massive change. Yeah, I mean, that’s, that’s, I want to ask you about that. That’s the generational conflict. I can’t think up my mind if this is overblown, if there’s lots to it. What we see in the Bay Area is that, you know, the baby boomers basically cornered the real estate market. They owned the real estate. They made it impossible to, to build anything new. And they kind of, they come up with something, I feel nonsensical reasons. There’s some truth to it, right, but it’s wildly blown out of proportion. So they kind of invented, as long as there’s a little bit of migration to the area, they invented a money printing machine that nobody has. I mean, they don’t, beyond purchasing the real estate that there’s nothing else you need to do, keep the same regulations in place. So I’m just using the Bay Area as an example, obviously that the whole, that’s the whole truth of like Miami, for instance, but let’s use the Bay Area. And I feel like the, the millennials, they’re very smart kids, but what, what’s missing are these big opportunities they can, they were readily available when I was 20. And from my point of view, maybe it’s just me, you know, there is obviously a personal debate about this, but I feel the generation has that impression that they can never afford a house in the Bay Area, right? They could go somewhere else in the U.S. and Vegas, obviously it’s a different story. But in the places they find attractive and their parents found attractive, they kind of afford a house, they have trouble financing their family, they have trouble finding an opportunity that’s a long term, you know, the baby boomer model that you have a career and you go into it and then more or less, you’re going to have a career to it. Maybe you switch companies, but there is some kind of career. Say if you work for these platforms, Uber, YouTube, it’s great and you can make money, but you can’t, it’s very difficult to feed a family, it’s very difficult, it’s impossible to build, to, to finance a house from this. So the opportunities are gone and what they do, they kind of go, let’s do a political over upheaval, let’s do, let’s think about the earth. So the other topics come up that I feel wouldn’t come up if there would be more opportunities. Well, I mean, look, I think that the Bay Area, with all the wonderful things I can say about the Bay Area and I am, as you pointed out, I’m a Bay Area native, I’ve lived here all of my life, I love the place. I am also a homeowner here and I’ve owned a home for a very long time, so I’m on the other side of that equation. So we know you’re rich. No, no, no, I’m a homeowner. So I guess it was a good investment, let’s put it that way, but I also live in it. So look, I think that for all of the good and the wonderful things about the Bay Area, we have a lot of big problems. I mean, you’re basically talking about, if you think about the peninsula, we’re a body of land surrounded by water on three sides, there’s no place to go. If you think about the economic dynamic that has happened here, so many of the world’s largest companies have their bases here and there’s only, you know, there’s the natural thing, there’s only so much land and people want it and the prices went way up. And so that is a problem and I think there’s a great stratification of wealth or lack thereof in the Bay Area that creates a socioeconomic problem and we are going to have to try to solve that and I don’t see enough to be done to solve that, although I see some glimmers that people are starting to realize that. I think that one of the silver linings of COVID is most of those companies, you know, most of the white collar workers in Silicon Valley can don’t need to work in Silicon Valley any longer. I think a number of the bigger companies and a number of them have already said this, right? Salesforce and Box and a number of companies have said, we’ve realized that we don’t need to have you show up at our office in Silicon Valley every day. And so you’re seeing a migration and a move to different areas, right, to Denver and to the Midwest and to Miami and to the Southwest and Seattle and other places until people are making decisions, they can decouple their best career choices from their lifestyle choices. And I think that will continue, but at the fundamental level, that doesn’t work for everybody. And so I think it will loosen the pressure on Silicon Valley, but if you think that we’re going to have a situation where housing prices are going to fall by 80% in Silicon Valley, I don’t think that’s going to happen, because I still think there is a lot of gravity that holds this place together, you know, commerce wants. The next question, the rents in San Francisco have dropped by 50% and the sales tax revenue has dropped by the same amount. So it seems to be half the people left, and San Francisco obviously had a lot of daytime commutes, so it didn’t have that many residents, but about a million or two commuted during the day, at least during a work day, and they obviously spent money, so the sales tax fall might not be the best proxy, but something is going on in San Francisco, I think it’s less strong day influence in the peninsula. In terms of the future of Silicon Valley, do you feel this idea of Silicon Valley will go further to the cloud, and that’s what you’re looking for, for investments also, for potential startups that you invest in, or do you think the legacy part of San Francisco Bay Area will stay so strong that it will be the predominant place, real place, like real life place for the next 50 years? I know it’s hard to make predictions so far out, but a lot of people told me, you know, the idea of Silicon Valley is still there, but basically Miami is next, Shanghai, Singapore, don’t even bother with San Francisco anymore. Yeah, I mean, look, again, I’m in my 60s, I’ve lived in Silicon Valley since birth, so I have 60 some years of history here, and I’ve heard this many times, Silicon Valley has been dead many times in my life, and I do think that people are making choices, that this place isn’t for everyone, and I would also say there’s a big difference between for example, the peninsula where I live in San Francisco, you know, even though they’re lumped together, because obviously we’re one economy in many ways, but a person who lives in San Francisco has a very different lifestyle and urban lifestyle, even the temperature, you know that in the summer sometimes there’s a difference of 30 degrees between where I live and 40 minutes away in San Francisco. I mean, it is an interesting, we are an interesting micro climate and micro place that has a lot of different attributes, and so I think that San Francisco has some great attributes, and I think it has some flaws that come out when you go through these rapid types of change like this, and they’re going to have to be very creative about how they solve that with some of the companies that established very big footprints in San Francisco. I think in terms of, you know, yes, people move away, it’s kind of funny, we’ve seen people move to Miami, we’ve seen people move to Austin, and then we’re seeing all these funny things on Twitter about, oh gosh, I hadn’t considered the weather when I moved here, and all of a sudden, and as one of my partners from Florida said, oh wait till they go through the summer, they’re going to learn something about summers in Miami, and so yeah, I’m a little biased, but I think there’s a lot of lifestyle about living in the Northern California that is really nice, and maybe if you don’t want to pay the high cost of living on the peninsula, maybe that means you move to Sacramento or you move to the, you know, Foothills of the Sierra Nevada’s or something where the prices are much less expensive. So I don’t know, I don’t have an awesome crystal ball on this, but again, I would say there’s a lot of ecosystem momentum of being in the San Francisco Bay area. I don’t think that completely dissipates, and I think there’s a lot of, again, natural beauty and natural resource that also keeps people here, the weather, the climate, the proximity to the mountains, there’s a lot about this area, no, it’s not perfect, not many of problems, but I don’t see it just completely disappeared. Yeah, what’s interesting, and I’m exploring Miami, I haven’t been here in a couple of years this week, and what I realized is that the amount of new development, of new structures that have come up, so downtown looks like Singapore now, and there’s like condo sales everywhere, where whenever you drive through Miami, like every second building seems to be open for new leases, and it’s maybe not much cheaper than the Bay area, but the quality is like a different level. I feel like there is a world level of expectations, like I used to live in Singapore, and you have a certain idea, and I grew up in Germany, there’s a certain idea of how apartments should look like. They don’t look like that in San Francisco, right, they’re 200 years old, 100 years old, and they’re three times as expensive, but the water doesn’t work, the heating doesn’t work, it’s like it’s falling apart, and that is, you don’t see this in most places outside of the, say, New York, Seattle, Portland Bay area, outside of those there’s a certain world level expectation, it kind of looks like when you buy a condo in, say, Bangkok, they all look the same, for better or worse, right, so there’s a, maybe that’s a problem, but there is a certain, it’s a couple years old, and it works very well from what you can see, it might be different in 10, 15 years, and it doesn’t have that character that many places in San Francisco have. I always feel, and I live in San Francisco, I feel like I get a raw deal in San Francisco, but then it’s true, what you say, there is things that are somehow, you can’t put your finger to it, but there’s something to it, people have, they’re extremely smart, you have this random conversations about startups, and in a random coffee shop, you have this, people are very intellectual, they used to be at least, right, they had this, this sense of we, maybe it’s the messiahs complex, right, they had this sense of we are chosen, kind of think about the Old Testament, we are chosen to make the world a better place, and we want to share that, we want to go around and evangelize to an extent. Well, and remember, much of the Bay Area population is an immigrant population, I’m a first generation child of European immigrants, and so, many of the people who are here in the Bay Area came from somewhere else, because they believed in the dream of Silicon Valley, right, again, to use it as a generalization, a lot of what you’re talking about with respect to crappy apartments in San Francisco, that was a recent supply and demand issue, right, that if you had bought in San Francisco 20 years ago, you wouldn’t be spending money, you were an hour, even 10 years ago, I think what happened is there was sort of this urbanization of the Bay Area, this move to San Francisco, a number of company headquarters moved, you know, if you look at Silicon Valley, why is it called Silicon Valley, it’s not called San Francisco, because most of the companies that were the epicenter, you know, back to the days of Cisco and Intel and Apple, these are, these are peninsula companies, they’re not San Francisco companies, it was only with the more recent moves of whether it’s Salesforce or, you know, Google the San Francisco presence there or whatever, that, that weight moved to San Francisco, and again, San Francisco is a city founded on three sides by water, with no, basically no buildable square footage left, and so, you really had a kind of supply, and it’s not like there’s some master planer thinking this all through, right, I mean, there’s sort of a supposed to be, but there isn’t. Well, you could, you could build up, right, you could build upwards, and that hasn’t happened, and that’s, it’s, it is being rumored, and that’s my take, so City Hall, the baby boomers made a deal with the social justice warrior activists, and said, okay, you go along with our policies, and we go along with your policy, which means we can’t build higher, right, so I mean, it’s more complicated than this, obviously, but it’s very difficult to get new permits, it’s gotten better, but it was really difficult the last time. And it’s way, it’s way above my pay grade, and I would say that there’s an imbalance, and what’s happening now is San Francisco is going to have to rebalance in some ways. I think what you said is really interesting though, because if you look at the, if you look at the macroeconomic trends, and you think there was so much talk about urbanization, urbanization, young people are moving to the city, everything’s going to be more urbanized, people are going to want to live and work and eat and sleep and play and all in the same small area. And what happened is COVID sort of put that on its, on its head, and, and there was this, this great sudden recognition of, gee, maybe I want more personal space around me, maybe I want to live closer to nature, maybe I want to live closer to my family. So many people are moving back to, to family epicenters, and I’m on the board of a company called Invitation Homes, it’s the largest owner of single family home rental in the United States, own about 80,000 homes. So we pay a lot of attention to the, to the dynamic and the macro trends about where people are moving and what people want in a home. And it is interesting how something like COVID comes around and really dramatically changes how people think about what they want. And so that is going to have an impact on every urban center, not just, not just San Francisco and New York, but, and then how long does that stick? You know, some people move to the suburbs and after two years say, I don’t like this. Some people move to the city and after two years say I don’t like this. So I, I think we’re in this, and I think it’s fascinating anytime you have a cultural shift and an operational shift like we’re having and literally a shift that impacts your health, people make new decisions and try new things out and we’ve been untethered in many ways. I mean, I don’t remember what percent of the U.S. went from work, it’s, it’s a big number, you know, I don’t want to quote it because I’ll get it wrong, but it’s in the many 20s or 40% of the American workforce no longer has to live in the city they work. And that is a shift, the likes of which we’ve probably never seen before. And so I think in many ways we just, we don’t know what’s going to happen, but I think that one thing we know for sure that’s going to happen is more choice, more diversified choice, which is a good thing to learn. Are you familiar with the book? I think Jared Diamond, that’s his name, John Gunn’s Germs and Steel, what he predicted, and the book I think was written about 20 years ago, and his idea was to find out what made the vest so much more successful than the other cultures. I think that was basically his thesis. And what I found so interesting is that the basic observation, which was probably that wasn’t something he discovered, is that obviously if everyone wants to move to an urban environment because it increases productivity, right, so because you can specialize more, and that typically increases productivity, because once you know something really well, and we see this with the internet, literally one person in China can supply everyone on the planet, 9 billion people with one specific solution, so to speak, or in the US, wherever that person is. And what he said, so it’s very natural that we have this behavior to come closer together because that makes us richer. So I think that’s why the organization worldwide keeps going, and I don’t think COVID will change much of that. And the other thing he said is, but the problem with that is that we are getting very susceptible to viruses. So Germs will easily have a much bigger impact because if you live apart, then nothing happens. But if you live in Tokyo, think of Tokyo with tons of people on the subway station. It spreads immediately. What’s funny, though, is that the most dense populations on the planet in Asia, they haven’t had much of a COVID impact as far as we know, and the US, which is pretty spread out, not San Francisco, but the rest of the US, had a seemingly much bigger COVID impact. And I felt like something is going on there, so maybe Asia was already immune, or maybe they don’t tell us. I don’t know what’s going on. How do you feel about that? And maybe there’s something else you learned from the book. I thought it’s a very interesting book. Well, I mean, I’m not an expert on COVID, so I’m probably no more expert than anyone else who’s just reading the news and paying attention. I think that some of the reasons why some place is spared better than others is, frankly, how early did they change and adapt, and how central was their responsiveness to it? And I, again, I’ll just say, I think we’re doing better now, but I think America did not do a very good job in the beginning innings of this. So I think we still have a long way to go and a lot to learn, and I think this is going to be here with us for a while. I think that for anybody who thinks we’re going to go back to the way it was, that’s not true, and I think we more are thinking about new normal. I do think about new normal. But if you think that being in a denser urban area, it’s going to make the more susceptible to the virus in the future, it’s hard to imagine that coronavirus is the only virus we’re ever going to face, and coronavirus itself is transforming right now and is probably going to be around for a while. So I think it does make people think who’s choices. I also think that when that book was written, the opportunity to contribute and work remotely, when that book was written, we could never have done what you and I are doing right now. The technology just wasn’t fast enough, it wasn’t pervasive enough, it wasn’t cheap enough. And so I think that now technology has enabled the kind of productivity you only used to be able to do in urban areas to be able to do it, not being physically present in urban areas. So I think we’re still in the primordial soup of this. I don’t have a solid answer. I’m trying to watch the trends, because of course, as a VC, you try to tune your crystal ball and say, where do I think this is going so that I can make sure that I’m on top of those trends. But I just don’t think that those trends. It’s very difficult to forecast that. Let’s think about that later. I have a couple of quick questions for you. If you want to answer them, just like with a sentence or two, as short as you can, so it still makes sense to you. First one, that’s something we’ve touched so far today. Do you think we live in a simulation? No. Okay. Can you say real short why? Well, I was going to say, but define simulation. Because I do think that reality is perceived by each person differently. What this typically refers to, obviously you’re right, the definition isn’t something I delivered. It means there’s another intelligence that set up the environment for us, and then we are like a subset of that intelligence right now. Maybe we will go out of the system one day, but so far someone else has manipulated universe or we are just living in it, and we think it’s real, but it’s never been real. I mean, this obviously goes up to infinity. I do believe that there is an order to things, and there is a connectedness to things that is as yet not fully explored nor defined. And so to the extent of that, how that came about, I am not, I do not relate to you. That’s your favorite spreadsheet tool. Teamaker. Yes. Is it still around? Do you still use it? Is it like, is it ported? Okay. Well, it is sort of around. My brother is still is doing some stuff on the web, you know, but hey, that was my native language. So now, like everyone else today, I use Excel. Not inspired. I’m not inspired. What do you think of Mark Andrezon? I think he’s a brilliant guy. And he’s bold. Do you think there’s going to be a singularity in 2038 that’s been changed at eight from 2045 to now 2038? Records wild thesis. I know it well. I think it is a very fascinating question. I think that the line between carbon based life and silicon based lifelike thing is going to get very blurred and it is my hope that we end up with the best of both of those things and not with competing things. But I do think that those are issues we are going to have to face as. Related to that, do you think we’re going to live forever in 20 years from now? That’s kind of part of his thesis, right, that we can live forever? Part of his thesis is that, you know, you can upload yourself into silicon based life and then live forever. I guess the question I have is if that happens, are we going to know it? Because if you were to completely upload yourself into something to everyone else, that might still look like you, but your essence, your soul may not be in that thing. And so are you really going to know if it actually worked or not? That’s one of the very good questions, right? And it kind of goes back to simulation, are we able to simulate it as good as the real thing that we experience right now? So if it’s a simulation already, then it’s much more likely we will be able to simulate it perfectly. But if it’s not a simulation, if it’s the real thing, we are closer to hardware, as people say, then it might be more difficult. I actually thought this would be a really great movie plot and anybody can do this. I will not come and sue you for the copyright. But the idea that at some point, you know, there are these many books written about small children who talk about a prior life and know a lot of things that they shouldn’t know about a particular person’s prior life, right, that the reincarnation hypothesis is evidenced through small children. Well, wouldn’t it be cool if sometime in the future there was this, you know, silicon thing, whatever you envisioned, the 30 years from now version of a robotic, you know, Alexa or Siri, and all of a sudden it started remembering something and would come to you and say, I’m your grandfather. And would know things about your grandfather’s life that you didn’t know. At what point does a person’s essence or soul, does the silicon based life form become human like enough that it starts to become the vessel for a soul? Oh, yeah, I think Black Mirror had that, right? So they basically had this idea you can, and I think Vestival copied that. The idea is that you have this little kernel, this crystal, so to speak, and you could just put it in a different brain. And then the outside of the human, the human robot, would change or would be the same, but the kernel, the soul and the identity, the consciousness would be transferred to memory. I haven’t seen that episode, I’m going to have to go look for it. They both played for that. Yeah, it’s I think season three in Black Mirror and the last season also in Vestival, they played for that a lot. It’s a very tricky question at the, I always feel if our ancestor would all be around, say we find a way to download these souls from heaven, let’s assume there is one, we can read it from the DNA, because we’re all predetermined by DNA and that goes at the free will, right? So is that really a free will or isn’t there? Well, let’s assume we could, let’s assume we had hundreds of our ancestors talking to us all the time, doing before puberty, during puberty, afterwards. I don’t know if this is such a good idea. It sounds exhausting, it sounds exhausting to me. Yeah, I think we would be so constrained. Like I think, and then Amit Rathore was giving me that idea, I asked him, you know, what is the best entrepreneur? Maybe I should ask you this question. Do you feel the better entrepreneur, a better, just say that the more successful, it’s hard to define what better is, is the one who knows nothing, there’s no prior experience. What I want is a super experienced and knows, is very wise, knows the most, so to speak, not just in a particular area, but it’s generally a vice person, a well educated person. My experience is the best companies that are most successful know how to create leadership teams that contain both of those elements. Sometimes you see entrepreneurs who have no experience of background in something and they are untethered from the past, and sometimes that allows them to think up of the most disruptive ideas. But I think very often that when you care those people with people who have a lot of experience, you get the best solutions. It’s something I say to my, the entrepreneurs I work with a lot, I say there are things you’re trying to do that no one’s done before, and those should be hard. And then there are components of what you’re trying to do that other people have done before, and those should be easy, and you shouldn’t have to invent everything because you should only invent those things that are most needed to create the next thing. I always think it’s funny when people start companies and then they build their own finance systems, they build their own HR systems, they build their own MRP, and they do a bunch of stuff that they really didn’t need to do, but they just feel like they have to make everything themselves. That’s not terribly efficient. I think the best things are built on top of things that didn’t before them, but sometimes you have completely disruptive ideas, and sometimes those come from people with them without the burden of prior experience. So I think you need that. It’s very solomonic as an answer. I think there’s a lot to it if you want to be clearly disruptive that you, every failure you had in your life that taught you a lesson that made you a more efficient person, but it narrowed your vision, so to speak, because you kind of exclude those options. If you want to, say if I’m a VC, I think I would pick from the people who have no experience, at least in this initial stage and would hope that you do your job way better than I could ever do. That’s not what I’m trying to say. But I think the impetus for me would be if I want to be clearly disruptive, I’ve got to go somewhere where no one has ever been before, and most people that have seen similar things fail wouldn’t touch them because they would exclude them a priori. And someone who is 19 years old and has only this tech idea, and then there’s a platform that helps to ship globally, or we have the internet that is the delivery platform for most things. Maybe that person, in 99% of the time, they fail, but I don’t care. I only want to have one of the winners, right? So as a VCU, you can hatch your bets way better than the entrepreneur. For the entrepreneur, I think knowing nothing is a raw deal. You’re not going to be successful. But for a VC to bet on people who know nothing and are 18, it might be a good idea. Well, every once in a while, someone like that comes up with something really earth changing, right? And you could argue that that’s been proven many times, but I’ll use Memphis Meats. It seems to be my best example for today. Uma, the founder, he’s a trained cardiologist, he’s a cardiac surgeon. So we didn’t know anything about the meat industry. And by the way, he hasn’t eaten meat since he was 11 years old. And yet he started a meat company because what he came to realize is the way they’ve developed current technology to grow heart parts for insertion into the hearts he was operating on could, in theory, be used to grow meat for people to eat. And so you could argue, I mean, is he experienced or not? Well, he’s very experienced in the areas of cell biology. He’s very inexperienced in the areas of food and meat. And that’s in a way probably what led him to the disruptive idea to do this ahead of most meat companies because they didn’t have that sort of experience. I like that. I like that a lot. That’s kind of when we talk of a human potential and people say, well, I had a really bad, I was dealt a really bad hand when I grew up, right? So like I grew up in a communist country, right? Or that I had parents who beat me up every time. That didn’t happen to me. I’m just saying I really grew up in a communist country, though. You had developed a sense of I didn’t get the best genetic or cultural makeup to really be successful. And you kind of developed this jealousy, right? But the way out, I feel, is always to say, well, that’s true. You didn’t have that. But you had all the other abilities because everyone is good at something. It just might take a long time to find. It might take 40, 50 years to find. And that’s really unpleasant. But you know, artists are so different than, say, someone who’s an accountant. And I always feel this is a very strong sense of optimism that you can transport. I never thought about it that way. That also is true for entrepreneurs, right? They’re idiots. They’re experts of one thing, but are complete idiots in the next one. And if they are willing to learn and maybe take some other experiences in it and have much faster learning, much more rapid learning than everyone else in that industry, that’s actually a great advantage. So they get the best of both sides. Absolutely. And I do think what you said, I mean, I think what you said is so powerful. People’s life stories and how they grew up and where they grew up, you know, Warren Buffett calls it the ovarian lottery. And look, in a way, I won the ovarian lottery because even though my parents were immigrants and had no money when they came here, they landed. And I was born in Silicon Valley in 1958. I mean, what could be a better place for the ovarian lottery to parents who my father was very entrepreneurial, even gave up a couple of times in his life, who was very supportive of my desire to be an entrepreneur, and he was an entrepreneur himself, who was not particularly financially successful, but he had a lifestyle and a growth mentality and a lot of things that I learned from him. And so I was very lucky given the family I was born into, right? And again, not socioeconomically so much as this right place, right time and right attitude. And so like you do for a lot of people, they’re starting, you know, five faces back. They didn’t have that and they have to get there. I do think that we, again, as humanity, it would be good for us to figure out how to bring more people up here because we need a lot more innovation than we have, and that’s going to come from a lot of people who are today not contributing at the level they could because they don’t have the access of their knowledge. I think that, again, the internet and accessibility of technology and education, and that’s one of the big things I think we need to improve again as humanity, but we have a lot of the tools in place. And if you think about the amount of knowledge that is available to anyone with a cell phone today versus how much you would have had to spend to get that knowledge and get that learning, it’s inconceivable, right? The increase is, you couldn’t have thought of the skill coming to go and believed that it would be true. And so, again, I’m an optimist and I really believe that that means we’re going to enable more people to create these breakthroughs. And in turn, not only do we have better lives with ourselves, but raise up the standard of living for other people as well. So not that it’s easy, but I do think that people can, you know, people can be part of their own, at least to be a better place. I think one thing we haven’t talked about, but we just, I think you just made a reference to that, is I’ve been thinking a lot what specific religion, but religions in general, if you really have to generalize, how much of an influence they have on entrepreneurship. And specifically, and from my background, I have a very Jewish name, but I’m not Jewish. My parents, it’s somehow lost. My parents are atheists, so they’re commonists. So maybe it was a generation before and it was hidden during the Second World War, you know, a lot of people gave up their religion for good reason, unfortunately. And when I study the last 10 years, when I look into religions, they seem to me having a different, the promise they make, I think it translates into people’s behavior and that it, in daily behavior, and that in turn, it’s really visible in entrepreneurship because entrepreneurship is the self fulfilling prophecy. You make a bet on the future, on yourself, on your family, on the startup, whatever that is, but you’ve got to first come up with this kind of optimism and then you’ve got to execute on it, so it can’t just be an empty promise. What’s your feeling? How strong is entrepreneurship and religion linked? And is it a specific religion or do you feel it’s somewhere like a meta value that people extract out of religion? You know, it’s such a fascinating question because as you were talking, I was thinking so I have worked, I’ve been a VC for 22 years. I’ve probably worked with 50 plus companies in that time, right? I mean, I’ve worked with tons of companies. I cannot think of a single entrepreneur I’ve worked with where their religion was such a central part of their life that I can tell you about religion. It’s just an interesting data point, right? Now, that’s not to diminish religion. I think religion plays an important role in many people’s lives. I actually think the older you get, the more you start thinking about this stuff. I had a Jewish father and a Catholic mother and I wasn’t really raised in either of those states. Neither of my parents was particularly religious in that way and so to me, while I have a lot of belief set and I’ve done a lot of reading about religion, particularly for Eastern, which I think is fascinating. It’s not a big part of my work day, but it probably, it is certainly a big part of how I think about how to treat people, how to treat the earth, being kind, you know, and it’s not because I think there’s going to be some payoff in the afterlife, it’s because I think it’s the right way to be a good human being in the present. So it impacts who I am as a person, but I don’t think that I’ve ever been really vocal about anything. And as I said, I think just empirically, in the 50 entrepreneurs I’ve worked with, I don’t think I could tell you the religion of the people. Yeah, so, but I find it interesting that when you look at venture capital and I guess you share this with other colleagues of yours in the industry, I feel there’s three major areas where there is a lot happening. So there’s a lot of potential startups people want to talk to because they might be worth an investment. I feel this is China with the extension of Korea, maybe a bit of Japan, but mostly it’s China. Then it’s Israel. There’s a bit of Europe, but I feel like I left Europe because I was very disappointed by how the European world via translated what I want in life, but that’s just me. And there’s the US. So how do these three places that are quite different, right? So Israel is very religious, everyone is religious, the US is more religious definitely than China. China seems to be very anti religious where, well, it used to be, maybe that’s changing or there’s a semi religion like communism definitely replaces that. Do you think that’s just an accident? That’s totally unrelated or these things are something in common. What I’m trying to get at is their way that we can predict how this looks like in 20 years from now. Well, can we use certain, what are predictive tools to see from that point, from that angle? There’s others obviously, but 20 years from now, what are the places that are very entrepreneurial and very innovative? Right. Yeah, I don’t know. I mean, again, as you were talking a super interesting question, I was thinking about, are you using religion as a proxy for how people think about their morals and ethics and how to treat other people because then I think what’s interesting and I think this is, so I’m going to answer a different question than the question we asked because I don’t know how to answer the question you asked. I think one of the, I’m going to answer the following question, which is how important do I think it is for entrepreneurs to have a sense of their role in all of humanity? And thinking of, for example, I think one of the most amazing things that Bill and Melinda Gates did when they started the Gates Foundation is this statement, every life has equal value, right? Which is in many places a very controversial statement and I think to many people a very controversial statement. And so I do think that one sense of what is your responsibility to the rest of humanity? What is your responsibility to the earth and the sustainability of the earth? What are your morals and ethics? What is your level of willingness to be following other people? What is your sense of living for yourself versus living for your broader community versus living for the whole world community? I think that all of those things impact how people prosecute their lives and obviously in an entrepreneur where the focus of your life is to create the thing you’re creating, I think that that has a huge impact. And so, you know, again, a lot of companies can make a lot of money doing things that don’t necessarily support humanity in a positive way. I can argue, for example, you know, you can argue. Well, Heidi, I think there’s a business opportunity that’s unlocked. So you know, there’s like Bundschatz Capital, Kelly Perdue, he basically is a military VC. So he basically, he tries to find veterans. And then if he can work with veterans, he does. I mean, he does, he invests in all kinds of companies, but that would be preferred founders. And I know you would rather invest, well, rather, you would see more women running startups who would definitely like to work with them. And I think those are great needs to be in, so to speak, right? Because they kind of seem to be the smaller percentage of that market. And I feel like a religious VC could also be really cool. I don’t know if this, maybe someone tried it and it never worked. But I felt that it’s something to it, to create this existing value set that you kind of, and it’s ethics, yes, that you put on like, you know, it reduces competition and it might improve the outcome. I think that’s, that’s at least what I learned from Kelly Perdue. He says, you know, the military value of a system is great. If people incorporate this, it probably makes them good founders. So I go with this. It worked for me. Right? I like that. I suspect there are people who invest money only in people who align with them religiously. Yeah. Well, or yeah, or the opposite, or yeah, or politically or culturally or, you know, ethically or whatever. Yeah. Well, what do you think is the next big thing in VC? It seems there’s a bubble in the early stage and in IPOs right now or aspects. What’s the next big thing? I really do think it’s solving some of the world’s biggest problems. Food and energy are at the top of the list. Is that something that VCs would touch because, you know, energy has been around, you know, my grandfather told me about nuclear reactors and free energy. And it’s what’s a long time later, 40 years later. Nothing’s done. I don’t think any VC seriously touched energy at all, but transport, you know, nobody wanted to touch it for the longest time. It was too big and too, too many after effects and too much regulation. Do you think VC is going to touch this or is going to be a public investment? We certainly made bets and we’ve made a big bet in food in cell based meat, which is a very risky, but I think also a massively revolutionary thing if it works and we believe it’s going to work. Again, I think you see people like Bill Gates investing in energy, including nuclear energy. And I think that as we start to see some of that become more viable, you’re going to see more traditional venture dollars go into it. I think that you’re going to see a lot in personalized medicine and all forms of medicine and all forms of just taking better care of human beings. And there’s going to be a lot of innovation in that regard, a lot of personalization in that regard. And there are going to be investment dollars because again, it’s a big market, right? Now, again, if you go back to the small VC firms like mine, we have to make money for our limited partners. So they’ll keep investing in us. Well, one of the ways you know you make money is go where there are really big markets, where there’s a disruptive event occurring. And I think right now there’s a disruption occurring in a lot of the markets, including food, including medicine, including transportation, and ultimately including energy. I agree with you. Energy is a hard one because it’s at a very high level, it’s very capital intensive, it’s very institutionalized, it’s often government controlled, it’s highly regulated. So there’s a lot of things that are like turnips to VC in energy, but it’s also one of the biggest markets there is, you know, that exists. One thing as a thought experiment that I ran this week is what would happen if we had free energy? Like, there is a price to it, but it’s like literally, it’s the smallest nomination we can think of in a kilowatt hour. What would you think would change? Say we do, we pour all our money into nuclear or renewables take off and solar becomes super cheap, Elon Musk solves this thing. How big do you think would that impact on what industries would you invest in if this happens? Well, again, first of all, I hope you’re saying not only free energy, but carbon neutral energy. Because if it has an impact on the climate change problem, that’s not solving the problem. So I’m going to say free carbon neutral energy. Carbon comes up with fusion, let’s assume that. So cold fusion finally works. I mean, with sufficient energy, you could change the living conditions in many parts of the globe. You could make it more hospitable. You could provide better nutrition. You can provide better access to clean water, learning. You know, I think it would really change a lot in terms of the developing world for the better. Yeah, I feel it would change the game completely, right? If it would be almost like zero price, there would be no limit into how many servers we can run. Right? So that’s a big, big cost of AI. And where we can run air conditioning and where we can grow food and how we can get water to people and how long we can keep the lights on and, yeah, it would be massive. What do you think about America, 1 billion people in 2040? Is that something you would put your signature to? Obviously, immigrants, because we won’t make enough babies. I, you know, I think that, I think that the whole, the sustainability of the entire earth and how many people we can support and at what lifestyle is a very complicated thing that is way above my pay grade and I haven’t thought a lot about that and a billion people sounds like a lot of people to have in the U.S. Then again, if you’ve driven across the U.S., most of it’s empty. And so I don’t think it’s an issue of land mass, it’s an issue of utilization of resources. So if you get, if you want to put a billion people in America that needs a completely free carbon neutral energy, you probably could accommodate it. But if you want to put a billion people in America and have to need to need 212 pounds a year of use or use like they do in America, you’re going to create a huge crisis. So a lot of it really goes back to the question we started this week is about resources. Yeah. But do you think bringing so many people in would be beneficial to America and the entrepreneurial side of America? Let’s assume we have no carbon issues, which, you know, everyone is getting richer anyway. So Chinese are almost as rich, very soon as Americans. So the difference in say what the carbon footprint is wouldn’t be such a big deal. Let’s take, put this aside for a second, do you think it would be a net positive? Or do you feel… Well for entrepreneurship, I mean there’s an easy answer and that’s based on empirical evidence of the past, a very significant number of the companies that have created the best venture backed returns and created the most GDP for America and created the most job creation were founded or cofounded by immigrants. So clearly the United States doesn’t have the law on the most creative people in the best range and I think that what would benefit from Silicon Valley, you know, when you look around Silicon Valley and go ahead and name off all the people who founded some of the biggest, most impactful companies, a lot of them came here from somewhere else because they believed that this was the best influence of resources for them to start a company. And so I think that America being a welcome place to have more people who come here because they believe they can do more with the resources of America is a good thing. Now that doesn’t come without its implications and again, we have the right resources and we actually accommodate everyone and make sure that everyone has, as Bill and Melinda Gates, you know, say that the lives have equal value, we can afford everyone the opportunity to give everyone education and healthcare and all those things and those are problems that I’m nowhere near solving. Yeah. I’m really excited by that idea. I mean, I’m not saying I’m 100% decided, but I like the idea of this massive growth and when I go around the world, I see a lot of entrepreneurs that are, that definitely have the entrepreneurial edge but are hampered by the place they’re in. You know, there’s corruption, there’s missing infrastructure. You can still run a business, but it won’t bloom to its full potential. It’s just way harder if you do this in smaller markets or markets are not as developed. You know, again, even culturally, I think this is one of the interesting things about Silicon Valley is one of the things I referenced about my father. My father thought it was awesome that I wanted to be an entrepreneur and was willing to say that was a good use of my time and energy after getting my college degree and my graduate degree. There are other countries where you go and it’s a disgrace if a child wants to start an entrepreneurial thing. That is a let down for the parents who supported them to college or whatever for them to go and do that. You know, culture has a huge impact and personal familial culture has a huge impact on what people feel that they are unable to do. Yeah, it makes a big difference. Yeah, I think the prior guest made that comparison, said, you know, if you would have done a high risk venture in the Middle Ages and it goes badly, you probably get your head chopped off either because you were in a real adventure or because someone who you own a lot of money to, they will not be so happy and they are ready to make an example of you. And the basic ideas often, as more risk accepting the society is, and clearly that is the US to your point. I think that makes a huge difference in terms of flexibility of thinking, but also flexibility of giving money, right? Like the business you’re in, you’re basically giving money with very little constraints to strangers and you hope for the best, which sounds crazy to everyone else. There are no constraints in that and hopefully by the time we give them money, they’re not strangers either. But I get what you’re saying. All right, but it’s an on paper LLC with some paperwork and you’re like, these guys could just take the money, go to Russia and just live their life there, right? So, I mean, obviously you do it, you’re clever, you know how to to to avoid that. But the place I’ll agree with you is once the money leaves our bank account and is in their bank account, it is way more up to them to decide how it’s going to be used than to us. And so, yes, it’s especially an early stage venture. We’re basically boiling down to betting on that it’s a big market and then the role of the DC is relatively minor. How many entrepreneurs would you like to murder as a how many entrepreneurs would you like to murder because they’ll have so much money for you? Oh, thought experiment, pure thought experiment. Yeah, no, I don’t want to murder anybody. I mean, all of it’s a learning experience and and you know, sometimes, you know, even the one that speaks volumes, right? That speaks volumes. Anyone else who is in that position and often it’s, you know, it’s more dare money for you or do you invest someone else’s money, but a lot of angels have the same mindset. They’re like, well, you know, it wasn’t the entrepreneur’s fault. I think that’s amazing. That’s an amazing American mindset. It pays off in the long run, right? That’s why this mindset is. Well, you wouldn’t do this job if you wanted to take it out and get personal with anyone who didn’t succeed because you doubt way too miserable a life. You’ve been Boston is about a market for that. Yeah. Italian quarter. No, I’m just kidding. Anyways, I think that’s all I had, Heidi. Thanks for doing this. Thanks for taking the time. This was tremendously fun. You expanded. I’m here. Made me think about a lot of things that I hadn’t thought about before. So thank you. Sorry for torturing with all the macroeconomic questions. That’s okay. I hope I passed the test. Oh, absolutely. It’s not a test. Not a test. Thanks for doing this. One more time. And I hope you see you again. Yeah, me too. Talk soon. Bye.

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