SPEAKER_00: Hey, everybody, welcome to another episode of This Week in Startups, your favorite tech business news podcast. And we've got a great show for you today. First up, we're going to talk about the streaming wars. All of these streaming platforms are going to spend $140 billion on content in 2022. We're going to break down their different approaches. We're going to go to an archival clip of me on CNBC predicting Disney's ascension in this space is basically a reverse Professor G prediction. In other words, it's correct. Who's the sniper in all of this?

SPEAKER_01: Who sprays and prays? It's a great overview of all the streaming platforms.

SPEAKER_03: We are also going to talk about Elizabeth Warren's take on grocery stores and whether the senator is gaslighting or just doesn't understand the grocery industry. Don't worry, this is not all politics. We really are trying to dig into the economic understanding or lack thereof here and talk about what it means for when we talk about how business works in this country. And then the first episode of Angel season six, Mac, the VC joins the show. The season's theme is first time funds and the discussion between Jason and Mac, you are not going to want to miss. This is interesting. You guys covered so much social and economic territory. And also I learned a lot about raising a fund.

SPEAKER_04: And so we talked about Joe Lonsdale's crazy tweets.

SPEAKER_05: So, uh, and that we haven't talked about that on the show. It's going to be a great episode. Stick with us.

SPEAKER_08: Season six of Angel is brought to you by Embroker. The Embroker startup insurance program helps startups secure the most important types of insurance at a lower cost and with less hassle. Save up to 20% off traditional insurance today at Embroker.com slash twist. While you're there, get an extra 10% off using offer code twist. Our crowd. Our crowd helps you invest early in pre IPO companies alongside professional VCs. If you're interested in investing, you can join our crowd for free at O U R C R O W D.com slash twist. And LinkedIn jobs. A business is only as strong as its people and every hire matters. Post your first job for free at linkedin.com slash angel.

SPEAKER_03: All right, let's talk about the streaming wars because the streaming wars have reached an amount of money that makes them essentially stratospheric. It sounds like according to Wells Fargo projections, the nine biggest media technology companies, which I'm going to say is all of them are going to invest $140.5 billion in 2022. We have to assume that the, the vast majority of that is going to be on content. HBO is planning to spend $18 billion, Netflix, $17 billion, Disney, $33 billion. They have a lot more brands. I sort of wonder, I mean, I have a lot of thoughts and questions about this, but doesn't this just mean that by the way, incumbency is unassailable? Like you could never break into this market at this point. Could you?

SPEAKER_16: That's a great question.

SPEAKER_18: Um, it would be very hard because, uh, there's certain IP that's incredibly powerful and that's Disney's obvious superpower.

Chamath Palihapitiya: But HBO is doing original content, um, very little, you know, IP based content. They will go back to their own personal well and do something like, I guess the many saints, you know, the Sopranos, uh, sequel, uh, or the matrix sequels or sex in the city sequel.

SPEAKER_00: I mean, they're, they're mining some IP, but HBO is a lot of new stuff. Um, and I think HBO is the real story here. Just looking at my own consumption and watching how good HBO is. And HBO was always cruising like 30 million members. And I think they're up to 77 million members or something like that. And they've had a great run of a lot of unique IP that they, you know, did themselves. And so stuff like curb your enthusiasm, amazing, you know, people coming back to that. But they did a show called hacks. They did a show, uh, called the flight attendant. They've done a lot of shows that I see are getting, you know, mayor of East town, just

Chamath Palihapitiya: original IP euphoria, secession, insecure, so many great, you know, appointment watching shows. Uh, quite low.

SPEAKER_03: It's pretty good. This had reminded me that I saw a tweet from Sam Sanders from NPR the other day, and he was like, HBO max has yet to let me down and lists a bunch of those. Original sex lives of college girls, euphoria, right? Just gemstones. I may destroy you. And he was like, I can't think of another streamer this good. So consistently, like we know that content is king and clearly HBO has the content. It does seem to indicate though that like, that's it. I mean, I guess, you know, what is the competition for these large streamers, YouTube and tick tock?

Chamath Palihapitiya: I guess, you know, for, for time, but if people do like to watch shows, even young people. So as much time as people are, people may spend, you know, hours a day on social, but they're going to spend $15 a month on these. And I think that's the big story here is just what an amazing bargain these are. Yeah. You know, if you're, if you've got kids, Disney for 10 or $15 a month, I think people would pay three times that for the product. So, and because of the global audience, these things are hitting hundreds of millions of subscribers. So Netflix is at 250, I believe, or somewhere in that range. We don't have that in the notes here, but HBO, I think was at 75 million already. Disney's way over a hundred million. I believe that there will be 500 million to a billion subscribers. Just let that sink in for a second on one of these services. And, uh, I kind of got laughed off of, uh, CNBC. We can pull that clip at some point where I was saying, listen, I think Disney is the best thing that'll ever happen to Disney is going direct because they'll have everybody's credit card. And for the first time, they'll have a direct relationship with their actual audience.

SPEAKER_21: And they will be able to sell tickets to Disney World or Disneyland inside the app. Or they'll be able to say, Hey, listen, you watch a lot of Star Wars. Did you know about the Star Wars merchandise?

SPEAKER_00: And in Disney Plus, you don't have a merch option, but you could see if somebody watched

Chamath Palihapitiya: all of Book of Boba Fett, they could, uh, then cut to, um, you know, at the end of the show, say, would you like to buy this merch? Now they haven't done that yet, but I mean, come on. If you were watching the Mandalorian and they said, here's one of a hundred thousand first Brogu's, uh, the baby Yoda's. Oh my God.

SPEAKER_03: I know that is a weird miss. And maybe Disney doesn't care because they make, I mean, I think they don't care because they make so much money. But part of the reason that they've been so into franchises historically is the merch potential. And they have kind of, that's been a bit of a whiff when it comes to some of these Disney originals, especially around the Star Wars stuff.

Jason Calacanis: I mean, they didn't even have baby Yoda merch for like, no, all year before making it on Etsy. Yeah.

SPEAKER_04: It was bootlegs.

SPEAKER_05: I know because we bought some bootleg stuff for Christmas, not bootleg, like Etsy stuff. Etsy stuff. Yes. Is that. It is bootleg.

SPEAKER_45: I guess it is bootleg just because it's done by individual. Yeah.

SPEAKER_03: Other things that are kind of fascinating about the difference too, is HBO does do this like really high quality content. And, uh, per our wonderful producer, I don't know who came up with this, but this is genius. HBO is a sniper. Netflix is a spray and prey. So got it.

Jason Calacanis: HBO is doing less at much higher quality and Netflix is just like, whatever. We'll greenlight it. Niche audience.

SPEAKER_18: Let's go. Yep. And then Disney is obviously just franchise central. So what is this chart showing here?

Chamath Palihapitiya: For those of you watching at, uh, youtube.com slash this weekend, or now Spotify has video. Thank you. Shout out, Daniel. Thanks for including us. Woo. Yeah. You can watch video. And then of course we do have a video feed on Apple podcasts as well for the seventh, uh, most

SPEAKER_05: popular tech podcasts in the world. Now number seven. You gotta love it.

SPEAKER_55: Yeah.

SPEAKER_56: Thanks for that volume friends. Thank you. Thank you for your reviews and everything else. So what are we looking at here?

SPEAKER_03: So I think we're looking at the original series and how people rated them, which shows, as you can see how kind of targeted HBO is like way, way, way, way, way fewer dots that people love, right? Watchmen outstanding, like lots of dots in the outstanding category. Netflix, tons of dots, like a fricking blood spatter from law and order all down in average and below or good. And then once you get into exceptional and outstanding, Netflix has like only a couple of dots. Although as you can see, exceptional, the Mandalorian from Disney game of thrones and Netflix gets to hear stranger things and the witcher, which is awesome.

SPEAKER_62: The witcher's good. I love the winter.

SPEAKER_32: I gotta get into that. What is the witcher? Is it like a game of thrones slash?

SPEAKER_03: It's game of thrones E it's based on, um, a video game, a long running video game series. I even read the books. Like I'm that much of a nerd, but yeah, it's like this, you know, the guy, this guy like loner, hot grunting loner who can do magic gets involved in wars and there's wars between magicians and people and he, you know, it's yeah. Great. It's like a game of thrones.

SPEAKER_68: If it were a procedural, he's like a cop magic cop.

Chamath Palihapitiya: I am just buying everything now. I just, I bought paramount plus cause I wanted to watch the south part. Uh, I have Amazon and I have my wife like star Trek. Uh, I got Amazon. Although Amazon seems to be whiffing right now. I don't, I can't tell you anything good on Amazon except for the boys, which, you know,

SPEAKER_73: The boys is excellent. The boys have the $5 billion Lord of the ring series coming out later this year. That's true.

SPEAKER_75: There's a $5 billion Lord of the ring series coming.

SPEAKER_63: I am watching, they have an okay library. I'm actually watching, um, Mad Men on Amazon.

SPEAKER_78: Oh, you know, I never watched Mad Men. I never did either. I just started it. Oh, there's your clip. Oh, is my clip ready?

SPEAKER_81: Baby Jason.

SPEAKER_80: All right. I guess we have to do.

SPEAKER_81: Baby face assassin.

SPEAKER_80: Oh God.

SPEAKER_74: I just, I hate looking at fat Jason, but I, I mean, I look like a linebacker, but okay. Uh, gets my best interest here, but let's hear if I got something right.

SPEAKER_83: A gigantic business.

SPEAKER_84: So I think there'll be actually four of these services that have a hundred million plus subscribers and that'll be, you know, the HBO, Hulu, Disney, Netflix, and you know, who knows who else will, will get there, maybe direct TV or YouTube, but multiple winners in the, in the winner's circle for this one. And Disney will be either number one or number two. They could even eclipse net, uh, Netflix. I know that sounds crazy to say right now, but if we look at it with a 10 year arc, it's completely possible they'll catch up. I think it's probable they'll catch up and it's possible that they could, uh, edge them out.

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Chamath Palihapitiya: which is TWIST, twist, twist, twist and broker.com slash twist. Literally, they laughed at me. And I don't know why this is not, sometimes I'm just like, I don't understand why when I make a prediction like this, it's not absolutely clear that it's so obvious because Disney at the time owned Marvel, Star Wars, Pixar, and all the Disney characters, completely obvious to me that if you have children, you have no choice but to buy the archive.

SPEAKER_03: It's so, well, I mean, if you think about CNBC and its audience, and I find this fascinating because now this is like the second or third clip we've seen where they literally laughed at you based on a prediction that extended past the six hours of the trading day. Yes. And it's like, everything that's wrong with markets is tied up in that CNBC reaction. They're like, oh, I'm sorry. We only operate in six hour mental increments.

SPEAKER_17: And Jason's like, well, I operate on 10 years.

Chamath Palihapitiya: I don't think Disney Plus was launched at that, right? When did Disney Plus launch? Because that was 2017.

SPEAKER_98: That was way before it launched November, 2019. Okay.

Chamath Palihapitiya: So Disney Plus launched in 2019. I said that two years before Disney Plus happened. So just to give you an idea, what is Disney at now, Molly?

SPEAKER_101: 118 million. Disney's at 118 million.

SPEAKER_03: Still, they have not overtaken Netflix yet.

SPEAKER_105: Okay. But in two or three years in market, they're halfway there. They're halfway there.

SPEAKER_00: If you don't understand what's happening here, when did Netflix launch their streaming service? That was 10 years ago?

SPEAKER_108: At least. Yeah.

SPEAKER_00: Orange is the new block was like their first original IP. They had other people's IP. So with a 10 year start, let's say it was a 10 year start. They're at 210, 214. In two years, you got to half. Does anybody see what's happening here? It's so obvious.

SPEAKER_32: 2007, by the way. 2007. Okay. Hold on a second.

SPEAKER_114: That's a 15 year. Netflix is as old as my teenager. So they have a 15 year head start for all intents and purposes.

SPEAKER_105: And in two years, Disney is halfway caught up. More than half.

SPEAKER_00: 60% of the way. They're going to blow past them. I will say Netflix and Disney in five years will have 300 million members each. Yeah. That's my prediction. I know that maybe they're 44 million year over year growth for Disney, 4 million year over year growth for Netflix. So Netflix is growing 2% a year. Disney was growing like almost 100%, right?

SPEAKER_119: They added 44. No, they were 50% year over year. Yeah. Because they're starting from a cold start.

SPEAKER_03: And Netflix keeps getting more expensive. And so far, Disney has leaned into just keep growing at $799 a month. Such a better strategy. It's cheaper. Netflix is so expensive now that it's the one that I don't watch and I'm thinking about getting rid of because for the $18 premium. Like if you want 4K, if you want HD, you're paying $18 a month.

SPEAKER_32: I'm like, I don't know. All this stuff is kind of on cable.

SPEAKER_21: I have to say Netflix, I have been having a hard time finding good content. Right now it's HBO Max, Disney, Hulu, Netflix is my order of like, if I had to get, if you had those four, you could only pick two. I'm probably going to HBO, Disney.

SPEAKER_129: I'm going to Netflix, Hulu. I'm giving up. What are you? It would be a hard one to get rid of though.

SPEAKER_32: Well, of course of live. So if you take out the live component, Hulu originals.

SPEAKER_134: This is where we watch SNL.

SPEAKER_136: Yeah, that's true. Yeah. You know, SNL, you can watch SNL basically on YouTube now. They put everything up there.

SPEAKER_106: Okay. Like truly, truly, truly got into my head. I'm going to say HBO and Disney.

SPEAKER_138: Yeah, I'm in your head. Yeah. I think it's a, it's a, yeah, HBO, Disney is a pretty good, uh.

SPEAKER_03: So my last question before we move on though is like, is, is this kind of spending on content an unwinnable war? Because if you project even further than five years, like sure, they'll have 500 million or a billion subscribers globally combined. But like, you still got to keep up that spending. So content, because content is a trap as we know. Do you?

SPEAKER_144: Well, do you though? Is the question? Because I do think these archives become so good.

Chamath Palihapitiya: You're watching Mad Men. I'm watching The Wire. Mm-hmm . So I am catching up.

SPEAKER_145: Mm-hmm .

Chamath Palihapitiya: And so I do think what happens is there becomes this base of content that's so good that when you look at why people stick with a service, like I'm never getting rid of HBO because every couple of years I, I watched some Sopranos episodes. And now I'm watching The Wire. I'm like on season three or four of The Wire. I'm loving it. Somebody's going to discover Mad Men. Some people haven't watched Breaking Bad. Some people haven't watched Game of Thrones. I think the archive, we are in this like archive building mode right now.

SPEAKER_00: And then when I think they hit scale, they may not need to spend as much, but they'll have much more ability. So let's just do some back. We have one or two hits a year. Eight dollars for eight dollars a month. Disney 118 people, 118 million subscribers. So that means that, you know, call it nine. It's almost a billion dollars per month. That is crazy. So they're making 12 billion. They're spending Disney 33 billion. So that means they're net 20 billion dollars negative for their archive.

SPEAKER_18: And so if you look at it as an investment in the archive, I think it'll be fine. I think that the long-time archive will just keep growing. And then, you know, when they hit 300 million subscribers,

Chamath Palihapitiya: and let's say they go to $10, they will have price of power. They'll probably go up a little bit. Then they'll be making 3 billion a month, 36 billion a year.

SPEAKER_18: So that's the math they're doing is they're looking at what I knew in 2017, which is they'll have three, four, 500 million on these services globally.

SPEAKER_21: And if they average 10 bucks and you've got $30 billion in cash flow coming in. Yeah. Crazy business. Now you add merchandise on top of that. Not to mention merch. Exactly. Licensing. It's going to be crazy.

SPEAKER_154: Yeah.

SPEAKER_21: And for Netflix, you know, let's say we split the, because they have a lot of international, let's just put them at $10 a month. They're making 24 billion. We actually know their revenue. They're making 30 billion a year and spending 17 billion. So there's the perfect example. They're at scale, Molly. They're maximizing price because they're not in the build mode.

Chamath Palihapitiya: They're in the extraction mode. Yeah. So they don't care about growing 20, 30% and getting to 200 million. They care about extracting max value. So they're definitely in the black, right?

SPEAKER_160: They're, are they profitable, Nick? They must be profitable. And then how profitable? Yeah.

SPEAKER_98: It's like four or 5 billion in profits for the year. They're expected to have something like that.

SPEAKER_17: Yeah. You know what we have not even mentioned here, which I find kind of amazing is Apple.

SPEAKER_161: Yeah. Apple is a black box. I don't think they're releasing their numbers.

SPEAKER_03: And is anybody, I mean, they had some good shows, but the velocity does not seem to be there. And we have no idea what their spending is going to look like.

SPEAKER_115: I think for them. But they've had some expensive shows. I mean, like it was very, but foundation was astonishing.

SPEAKER_25: I did the first episode, you know, I don't know if you have this, uh, in your relationship, but I did watch the first episode.

Chamath Palihapitiya: My wife was like, I want to watch that. And I'm like, Oh God. Hey, I mean, we, we have a couple of shows we watch together. We can barely keep up with them.

SPEAKER_164: But she falls asleep. And I'm like, babe, I really want to watch foundation. And she's like,

SPEAKER_19: God, it's a, it's a hard one to stay awake through. Although it's so pretty. I mean, I followed it through to the end because I, Oh, Ted Lasso.

SPEAKER_03: Right. Obviously. Which is so funny. Like Apple, I wonder what their strategy is going to be going to be because they aren't content first. So they can afford to potentially put out two or three of these great shows a year. Like they could move into the library phase, maybe super sniper. Yeah.

Chamath Palihapitiya: I mean, the thing is with the amount of cash they have, they could buy another company. There's always been this idea that Apple and Disney would merge. Mm hmm. If we didn't have, you know, the issues around antitrust, an Apple Disney merger at this point in time would be extraordinary.

SPEAKER_170: That'd be insane. And it would be doable. America's only company. Yeah.

Chamath Palihapitiya: You know, Apple's market cap. I mean, there are very similar companies and how they approach things. It seems like Apple's market cap, almost 3 trillion. Disney market cap, 287 billion. I think Apple has 200 billion in cash. Apple could just buy Disney at any point in time if they were allowed to.

SPEAKER_173: Mm hmm.

SPEAKER_18: It would be 10% of their market cap. And can you imagine if when you bought an iPhone, your Apple prime, what do they call the Apple bundle? I have the Apple bundle.

Chamath Palihapitiya: If the Apple bundle included Disney plus and access to theme parks and your iPhone got you into theme parks or whatever. Oh my Lord.

SPEAKER_174: Yeah.

Chamath Palihapitiya: What a great merger that would be. Ugh.

SPEAKER_175: Like that's as a capitalist.

Chamath Palihapitiya: It's just like drooling from it. Ugh. As a capitalist. Like the things you could do with Apple stores having Disney products and. You know, Mandalorian air pods.

SPEAKER_03: And they're equally ruthless at sort of like branding control.

SPEAKER_180: Extracting max profits. Yeah. Yeah. I mean, for me, that's the ultimate.

SPEAKER_18: I mean, you put that together, then you just. Yeah.

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SPEAKER_03: Your antitrust mention is an amazing segue into our next story, which is Elizabeth Warren, Senator Elizabeth Warren, tweeting who is, of course, an antitruster or an antitrust anti-capitalist, a socialist.

SPEAKER_05: You and I probably differ on this. This is what people have been waiting for, is to see if we actually-

SPEAKER_03: Let's just say there's been an evolution in Elizabeth Warren's positions over the years. She used to be a reformer, and now I'm not sure. So tweeted yesterday the following with a video attached from a recent MSNBC hit saying, What happens when only a handful of giant grocery store chains like Kroger dominate an industry? They can force high food prices onto Americans while raking in record profits. We need to strengthen our antitrust laws to break up giant corporations and lower prices. And let's, before we dive into taking this apart, in the hopes of at least a little more context, let's check out this 60-second clip.

SPEAKER_189: Remember how many grocery stores there used to be? And now what you've got is a handful of giant chains.

SPEAKER_190: And then what happens? Kroger. Their profits, just in the third quarter of 2021, were almost $900 million. That was more than three times what their profits were in the same time period in 2019. Now, if they are able to expand profits, not expand prices, expand profits, that's because they have a lot of market dominance here. If we move in on antitrust law, break up these giant corporations, then we get real competition. And then we get markets that are truly competitive. That's good for small businesses. It's good for consumers. And it actually, in many cases, reduces the need for regulatory oversight. You can count on the markets doing what they need to do.

SPEAKER_03: I just want to start by pointing out one simple fact about the numbers that she has cited on MSNBC related to Kroger's profits, which is that in the period between 2019 and the profits that she is mentioning that were just recorded and booked, there was a pandemic. What?

SPEAKER_195: During which- Do you have a link to that?

SPEAKER_196: Any information on this pandemic? I missed it.

SPEAKER_197: During which many restaurants, I don't know if you heard, were either closed or went out of business. And lots of people were buying groceries. Yes. Because they weren't eating at restaurants. There's so much wrong with this example, but that by itself is just like, I'm sorry, ma'am, aren't you an economist? Like, what the hell?

SPEAKER_204: She taught at Harvard, right? She's like brilliant. She's a Harvard, like she taught law at Harvard.

Jason Calacanis: This is a brilliant person. Like, I'm literally just shouting, this is a brilliant person. And I don't understand anything about this example. It is such a loser that it's like undermined.

SPEAKER_207: Yeah. You know, cherry, you got to be very careful when people cherry pick statistics.

Chamath Palihapitiya: Because if you cherry pick statistics and you're not actually, you know, looking at the big picture, that's always a little bit of a tell for me. Like when I'm investing in companies or assessing a company, if it's a good investment or not. You got to be very careful cherry picking. You want to look big picture. You want to look at multiple companies. You got to look at the whole market. And Nick Kokonis, episode 1262 from Alinea, tweeted exactly what your point is here. Molly, gaslighting, or does she actually believe this? Of course, grocery store profits drop. People have been eating every meal at home during the pandemic, either disingenuous or lack of economic understanding or both. And he continues in a second tweet, more profits do not necessarily mean that anything is broken. That's a false assumption and a bias. Basically, she's quoting a more successful business. They made three extra profits in 2021 than 2019 as being somehow wrong. Could they just be run better? Right. They could have just, you know, run the business better. I looked at it and the thing that came to mind for me immediately was I said, wait, and then I tweeted this, wait, wait, the grocery business is the lowest margin fragmented dogfight in all of capitalism. What is Senator Moore talking about? It's complete grandstanding. I use the term gaslighting as well, considering inflation is being driven by her belief in out of control spending. And, you know, like, that's my belief that she's really into out of control spending. Some people might say it's appropriate spending. We'd have that debate. But I just did a basic chart. I just did a search and hit Google images of like grocery store market share. Sam's Club Walmart has 21%. And this is a little bit old. I think it's a 2019 chart. Kroger, 10%. Costco, 5%. Albertsons, 4.9%. Yada, yada, yada.

SPEAKER_205: It's an incredibly fragmented market. Yeah.

SPEAKER_03: It's incredibly fragmented. Like there are, when I attempted to find a benefit of the doubt here, I thought to myself, okay, in America, something like 13 million people live in food deserts, where there is only one option to buy stores. Okay, sure.

SPEAKER_216: And so I thought to myself, if in fact, that's what she's talking about,

SPEAKER_03: and you only have one option for a store, and most of the locals have probably been driven out, right? And frankly, this chart accurately represents that in most of those places where there's a food desert, the option is Walmart. So if Walmart does raise prices, you are essentially a captive audience. So I thought, okay, well, maybe this is about that. But it does not appear to be necessarily, right? And I wonder how much- Well, she didn't say it was about Walmart. She didn't say it was about food deserts, and she didn't say it was about Walmart. And those are real things, but those are real things that are so systemic and structural and economic that to pin it on the sheer size of a grocery chain is weird and fundamentally inaccurate. Then I was like, well, some of that must be ameliorated by the ability to order groceries online. And I understand that there is a digital divide and broadband inequities. But none of that would account for the sheer blanketness of this statement that somehow consolidation and Kroger being profitable is just fundamentally all by itself wrong. Now, I will say that reported yesterday was that Walmart and Kroger hiked the price of COVID tests after the federal agreement to sell them at cost expired. So it's possible that she was talking about that because that is indeed some like- Well, that's just straight up- Pretty shitty-

Chamath Palihapitiya: That is drifting and corruption at the highest levels. Democrats, Republicans, and everybody in between are all paid off by, you know, these pharmaceutical companies and healthcare companies. And the fact that we have like, we don't have 80 tests available for $5 to $10 each is ridiculous. We talked about this on a previous episode. Yeah. And you know, one of the things that she's leaving out here is-

SPEAKER_03: They do crappy things, but this is just such a like poorly articulated number. Yeah. Or that one example is so, is missing so many contextual points that I, I just am like, I'm sorry. That undermines your entire argument.

Chamath Palihapitiya: But she seems to be making her thing. Because remember she attacked Elon and he's like, but I paid more taxes than anybody than the history of the country.

SPEAKER_224: So- I mean, that's true. And also tax rate. This is an- And also tax rates.

SPEAKER_130: Yeah, could be, could go up in different places. Exactly. Yeah.

SPEAKER_226: So I think one of the problems with the way people are sparring is intellectually dishonest

Chamath Palihapitiya: and it's becoming so intellectually dishonest and the, and the arguments are so poorly framed that they're doing themselves an incredible disservice. If you really want to be, um, uh, you know, a woman of the people, a man of the people, uh, you know, and represent folks, make a better argument.

SPEAKER_126: Go ahead and find the prices that have gone up. Make a list of the prices that have gone up and do the work. Find those places where there's a drought. And let's shame Broger if they in fact should be shamed. Right. Because milk went up a dollar in these regions where they have a monopoly and it's cheaper in these regions where they're competitive. And if that's actually happening, then you would have everybody rallying behind you because that's straight up bull . Like if you've got a monopoly in Kansas City and there's a food drought and in Brooklyn, you can't because there's too many options and you're, you've made it a dollar more expensive. But one of the also things that I thought was crazy, uh, Molly is when you have big companies come in, Walmart and Amazon and Kroger, their entire business model is to drive prices down. Mm-hmm . That is the business model, whether it's Amazon basics or their house brands. And I think the problem we have in the United States is food is so cheap, especially, um, bad food that we have an obesity problem. Right. So like, it feels like this person is trying to make a grandstanding argument, but does she have nobody on her team?

SPEAKER_231: Like our three producers who are all under the age of 30 can take apart a senator, Senator Karen's argument in 10 seconds. Mm-hmm . Like who's working on her team? Who are her producers that they can't make a better argument for her? I don't know.

SPEAKER_115: And point the gun at the right person. Yeah.

SPEAKER_03: You only have to look as far as, as let's say the beef industry where beef prices are in fact super, super high for consumers and ranchers are going out of business because they only have two suppliers to sell to, and the suppliers are like, we will set all that, right? Like there are many concrete instances of consolidation hurting consumers. This is not one of them. And then what happens is that it starts to just become this like ideological extremes. And you have all of these people who are like, I just want you to make some sense. Because when you stop making

SPEAKER_237: sense. Molly cursing. Uh-oh. I'm so sorry. Can't do that on public radio. Uh-oh. Oh, I just can't, I just cannot. It's great, isn't it?

SPEAKER_243: I just, it's great. You made a good choice. I think you made a good career choice for you.

SPEAKER_246: I really think I'm going to love this job. I already do.

SPEAKER_167: I am happy for your career choice. I'm also happy that at some point I can take a vacation.

SPEAKER_249: And I can leave the show with you and it'll be fine. It's true.

SPEAKER_126: I just love the fact that people love you. I am getting so many. Molly, I just want to tell you what a great decision you made. What a great decision I made. It took two years for us to make this happen. Um, but the reviews I'm getting from, they're like, Jake, how you're better with Molly. Oh, and it's the show's better. You're better. I can't wait for the next episode. People, the reviews have been universal. I've got one negative review. That's so great.

SPEAKER_115: Only one. Honestly, like I really, I have this theory that your life is in a lot of ways defined

SPEAKER_03: in part by the people who follow through. And for me, you're one of those people. Like you will be a hinge person in my life because this conversation has gone for so long and you have given me this opportunity to like make a massive pivot in my life and my career. And it already is like so fun.

SPEAKER_64: Yeah. And we're climbing in the rankings. The show quality is good and we're seven, eight episodes in

Chamath Palihapitiya: and a big announcement today. I forgot to tell you about this Molly, but I, I, I, since I've been getting good at getting talent on the show, big announcement, Nick, uh, we have our third co-host slash contributor when we go to seven days. You guys want to know who it is?

SPEAKER_258: I just got off the phone and, uh, Lex Friedman will be joining us full time and being a venture

SPEAKER_260: capitalist. It's true. It's true. I got him. I got him. He's joining. I'm joking. I'm joking. Lex Friedman is not joining the team. I'm like, what? And you bought a plane? I can't keep up.

SPEAKER_261: Can you imagine if I got Lex Friedman on this train? Hey Lex, would you like to be a venture capitalist? Look at the audience is hilarious. I got you all. I got you. I mean, it's obviously a

SPEAKER_126: joke. Uh, but who, I mean, as a thought exercise, who would be a great third person to bring into this mix? If we could, if we did have a third person, went to seven days a week, who would be a third

Chamath Palihapitiya: person? I know a lot of people say Alex Wilhelm, uh, from TechCrunch. Oh yeah. I do like him. He's

SPEAKER_76: pretty solid. You three have done an episode before. We have. It's great. It was a great episode.

Chamath Palihapitiya: You know, what's good about him too, is he's, he's particularly, I mean, I don't want to publicly

SPEAKER_126: recruit people, but, um, sure. Why not? Um, you know, he is very analytical. Uh, you know,

SPEAKER_273: like he did, he, one of his things is digging into those S ones. He does the S one breakdowns

SPEAKER_76: for TechCrunch. I mean, I do love those. Like he's awesome because he's the anchor of TechCrunch's

SPEAKER_126: premium product. Oh yeah. I forgot about that. And he did Crunchbase. So as a data guy,

Chamath Palihapitiya: like he's a super data nerd and he really cares about business model. That translates incredibly well into being a venture capitalist. And like, I think this 50, 50 thing, because when you're a media person, you can't give it up. You can't give it up. It's a addiction. You know,

SPEAKER_225: you're like, Hey, you know, you've been drinking booze for 30 years. Want to give it up? It's like,

SPEAKER_03: not really. I don't like my wine or whatever. I like the idea too, that being a media person is basically as longterm toxic and like, but it is a straight up addiction, but also it's such a great, I mean, this show is such a secret weapon because even if you can't invest in something, you can evangelize it. Sure. You can still like seed in the ecosystem. Ember mugs, shout out. Ember mugs, like mainstream climate tech, right? That's solutions oriented and not depressing and not like all synthetic biology. You can start to create a value proposition with the media side, even if you can't write a check to something. Oh, here's an interesting observation from one of

Chamath Palihapitiya: our folks in the chat room. They were just basically saying, uh, doing proper predictions while Prof G is the reverse J Cal. Hey, here's a great idea. If somebody as a super fan wants to do

SPEAKER_126: a super cut of my incredible predictions and then super cut them with Prof G's terrible ones,

Chamath Palihapitiya: that would be pretty hilarious. Um, I'm not saying that I would like, send you like a thousand dollars in ETH or Bitcoin from a anonymous wallet in the Philippines. If you did that, I'm not saying an anonymous wallet in the Philippines wouldn't send you a thousand dollars in ETH if you did. Uh, all right. So, uh, we're doing season six of Angel. It's, it's its own feed. And we also publish it here on This Week in Startups. It's just basically, I've been interviewing investors. I, hopefully you can get in on this too. Maybe you do one of the interviews or two of them. We do them

SPEAKER_231: together. But you know, uh, for the last couple of seasons, I've been coming up with themes. The theme

SPEAKER_21: for this year, Molly, or the season, season six of 10 episodes is first time fund managers. So you got your first fund. Typically those are 10 to 20 million. I just want to talk to first time fund managers because there's so many first time fund managers now, because it's so easy to raise a fund, rolling funds on AngelList, you know, popping up a fund on Assure, which we're investors in. I think Carta has tools to pop up funds. My friend Adeo is doing a VC lab where people are learning how to be venture capitalists. Everybody's learning how to be VCs, like yourself, Molly. So this season,

Chamath Palihapitiya: season six will be first time fund managers. And we're starting with Mac, the VC. So anyway, enjoy this interview kicking off season six of Angel. These days, it can be hard to find and

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SPEAKER_293: Hey, everybody. I'm super excited. It's season six of Angel. Can you believe it's been six seasons since I wrote the book Angel? We started this special series, special podcast as part of this week in startups so that you could learn from other investors, what their theses are, how they invest, why they invest, their best practices, you know, and just basically figure out maybe some strategies for being better investors. Now, if you're a founder and you're listening to this, you get to understand how the other people involved in the startup community, the people on the other side of the table are thinking about their job and their role. So congratulations on being sneaky and sneaking in here and understanding how to get that money and secure the bag. You know, we started this in 2017, as I mentioned, to compliment the book Angel, and we've started to theme the seasons. You may remember, and I think we started the themes around season four. Seasons four theme was the Three Comma Club. So basically people with under a billion dollars in management. So we had Dan Rose from KOTU or Sarah Cannon from Index, Sarah Tavel from Benchmark, just people with massive exits or massive funds. Season five, we did super angels and we had on angel investors who had done 50 investments or more. Mark Cuban, Gotham Gal, Joanne Wilson, Elad Gill, basically people have placed a lot of bets. Now, season six, I realized, you know, there is this huge trend. Many more people are starting funds. And so we thought we'd go with first time funds as the season's theme, basically new fund managers. And some of them had a little experience before, of course, but they've, generally speaking, the theme will be people who have raised a first fund, and they're, you know, under a new moniker, they got a new brand

SPEAKER_258: name, and they're deploying capital and hopefully building a brand that lasts for decades to come as investors. So our first guest will be none other than Mac Conwell. You know him as Mac the VC on the Twitter, he's very popular, interacts with a ton of people. And his fund is called rare breed VC. He's a two time founder, and he started raising a fund in September of 2020. And he has been doing for us over at inside the inside business podcast with Liam Gill, 36 episodes in and we're changing it up a little bit bringing some more of the analysts in. But he's been in my orbit. And this is the first time we're sitting down and talking together. He's closed 10 million in October of 2021, deployed 4.9 million since January of 2021. And their check sizes are very similar to my first fund 100k to 250. And we'll get into some of the great companies in his portfolio in a moment. But for now, welcome finally, Mac the VC.

SPEAKER_296: Thank you, Jason. I truly appreciate it. It's kind of weird and surreal to be talking to you right now

SPEAKER_299: because you don't know this. But This Week in Startups has been around for a long time. And when I started my first company in 2010, I didn't really start to learn about the industry and really pick up things until 2012. And I found this little YouTube show called This Week in Startups. And the amount of of things I learned watching some of those episodes, like I have to credit part of my journey to so thank you for that. And thank you for all the stuff that all the content you put out and all the education because you know, it's a black guy in Baltimore, like there were so many places for me to

SPEAKER_258: go to find that information back then. Yeah. So thank you. Well, it's, it's very nice of you to say and I always said, you know, as I was coming into the industry into the 90s, and I was a bit of an outsider, maybe not as much as you are, but white kid from Brooklyn with a 71 year average, you went to Fordham at night, fixing laser printers. So maybe my starting line was slightly ahead of yours. But it wasn't MIT or Stanford, that's for sure. I said, you know, if I ever make it, I'd love to, you know, throw a ladder down behind me and show some other people how I got in. And I did make it. And, you know, I started the launch festival and a lot of these events, which had free tickets, you know, and, and the podcast was, you know, for two reasons, one to talk to my friends every week and learn something from them. But also to just crack the industry open and say, Hey, listen, anybody who can get to YouTube or a podcast player, you know, here's Evan Williams, built blogger and Twitter, here's this kid, Kevin, who's making Instagram, here's Chris Saka, and Brian Alvey and whoever else, Matt Mullenweg. And let's just have a conversation. And it really is amazing how consistency in publishing has led so many people, I meet so many founders, and they'll say the same thing to me, this is surreal for me to be on the program, because I grew up on it, because we in year 11. And it's just that's really means a lot to me. So thanks for saying it. And I get it a lot. So tell me, how did you get the idea that you would go into venture capital? And of course, you know, we hear over and over again, this industry is impossible to break into venture capital is the hardest job to get. And when I came into the industry, you had to be somebody's fraternity brother, Harvard, Wharton, or Stanford MBA, even have a shot of maybe getting in as an associate, seems to have cracked wide open in the last decade,

SPEAKER_311: how did you get the idea that you wanted to be in venture? And how did you start that journey?

SPEAKER_299: Yeah, so I got the idea to be in venture by being an arrogant founder, like most founders, once you start raising capital, every founder who's gone through the process of raising capital has had the thought of, I could do this, I could pick companies, I could be an investor. Not really true. It's a lot harder than you think it is. But you know, in those moments, you start to have those thoughts. But I never had like a direct path. So you know, I had two companies, one, the first one, we sold the IP to a fortune 100 company, the second one failed. And then I ended up being head of technology at a marketing firm, right. And that was also a college dropout on the engineer before that. So not a VC path. And then the marketing firm I was working for got a client I didn't agree with ethically. So I quit, quit on a Friday, on principle, didn't have any plans, they know what I was going to do next. And the very next Monday, economic development firm in the state of Maryland that does investments on behalf of the state, put out this, you know, community wide email saying they were looking for a fund manager, a new fund manager. And again, I was arrogant enough to believe that with no finance background, no college degree that I could get that job. I had no clue, like how prestigious are like, how many people were going for that job are far more qualified than I was. But four and a half months later, they picked me and put me on their senior investment team. And I spent four years there. And I did a lot of cool things. And that's kind of how I got started. So I

SPEAKER_323: got started from email. Wow. And so a couple of lucky breaks, you get that job in we said it was

SPEAKER_258: Baltimore, yeah, Maryland. State of Maryland. But then at some point, you decide, you know what, I need my own fund. And that was I think last year or the year before you started that process

SPEAKER_311: of trying to raise it. You did it very publicly on Twitter. That's how you and I sort of became

SPEAKER_326: aware of each other. Explain this process of, again, back to the arrogance or the confidence or the

SPEAKER_258: boldness, whatever, you know, arrogance and being bold and being risk taking, you know, could be

SPEAKER_293: two sides of the same coin. So you start seeing other people raising funds or maybe rolling funds

SPEAKER_311: on AngelList. What gave you the inspiration, maybe syndicates, what gave you the inspiration to start your own fund? And how did you start that process? So the inspiration to start the fund

SPEAKER_330: came from two founders, right? The first one, there's a black woman in Baltimore who wanted to build a tumble dryer that can dry a wig or hair extension in 15 minutes with no heat, right?

SPEAKER_299: Really unique idea, super interesting market, zero innovation, tried for three years to help her. She got nothing but nose. And so the way she decided to get capital was she became a surrogate mother. She gave birth to twins to raise capital so she could start building her first prototype. Wow. And I got frustrated with the industry because I couldn't think of a fund that could have worked at and made that investment. But here's a woman building a product in the industry that hadn't had innovation in our lifetime. That's a $10 billion market, and nobody could see the opportunity when she was building. And so I knew if I was ever going to invest in founders like her, I would have to do it myself. And for context, at the time, working for the state of Maryland, I actually started a pre-seed fund specifically for underestimated founders to basically try to institutionalize the friends and family around to get them that really early capital. And I still couldn't fund her through that because our deal flow was so hot. And I was trying to explain to my team, like, hey, the next cool B2B SaaS company is great, but this is different. And nobody was hearing me. So like, that was the moment I knew I was going to have to do my own thing at some point. And then fast forward to 2020, COVID happened, George Floyd happened. So I tweeted some stuff about George Floyd, had to get off my head. And then I just stayed consistent, started being founders. And I met this founder in Dallas, Texas, a gentleman by the name of Roberto running a company called RoboAmp. B2B SaaS company helps makes websites faster. You know, he was doing decent monthly recurring revenue. The guy has been coding since he was seven, had the chops. Nobody was looking to invest in him because he was a Latin guy in Texas. So I was like, all right, I can put a SPV together. And I know some folks who like this space and get him some money, try to help him out. And one of my mentors said, look, I love this company, but I don't want to invest in this one company. I want to invest in every company that you find. So here's 250,000 go raise a fund. Wow. I was like, that's cool. But there's COVID, George Floyd, the world's crazy. I'm not, you know, now's not the time for me to do this. And he's like, no, you've been talking about this

SPEAKER_338: for two years. You need to just go do it. So I'm like, all right, I'll go do it.

SPEAKER_293: Wow. So you were meeting with founders and then trying to advocate for them,

SPEAKER_258: trying to pass the hat and maybe get an SPV going. And then finally, one of the people who is investing alongside you says, hey, I'll be your anchor. Here's 250, go raise the rest. And then you decide you're going to do 506c publicly raised, talk about it on Twitter. Something that when I started in the game 11 years ago, the lawyers were like, you cannot ever talk about raising a fund. And then all of a sudden people are like, but you kind of can. And that advice changed dramatically. So 506c means you're going to publicly raise your fund. If you do that, you're required to make sure that people are accredited. You've got to get proof. They can't just what's called self-certified. They can't just say, I'm accredited. And you say, okay, I'll take your word for it. Because we're doing it privately. If it's a public solicitation, I'm raising a fund, you have to do 506c. And so you figured out how to do that. And then what checks start coming in, you know, 50k, 100k, just from talking to people on Twitter.

SPEAKER_299: So originally, I was going to do just a traditional fund. And then a friend of mine's Kate brought it from the W fund tells me about this thing called a rolling fund. AngelList is doing these rolling funds. I'm like, oh, that sounds really cool. Then the big draw to rolling funds was you could publicly solicit. And I'm like, well, that's amazing. I'm starting to build on Twitter. I want to be able to tweet about this. Let me learn more. Well, I found out I didn't like the way rolling funds were structured. Talk about that.

SPEAKER_330: But I didn't like this 506c thing. So I talked to a lawyer. He was like, yeah, you can do that. You might do it. It's just a designation. And I was like, for real? He was like, yeah. I was like, well, that's what we're going to do. And so that's where that idea came from. But the way the check

SPEAKER_299: started was, I didn't know how to raise a fund. Like I know how to raise, I knew how to raise money as an entrepreneur. I knew how to be an investor. I didn't know how to raise from LPs, right? And I didn't have a network of LPs. So after I got the $250 check, my personal network got me to about 400k. And I was like, the goal is 10 million. 4% of the way there. Yes. So like the goal is 10 million. And so my thought was always, if you gave me 18 to 24 months, I could meet enough people and learn enough along the way. I could figure it out. It was going to take me time. But what happened was, you know, I mentioned that I had been tweeting. I started tweeting in like around June of 2020. And as I'm tweeting and tweeting, I'm noticing more people are following me. I know it's more VCs are following me. So I'm like, if I see a VC follow me, I'm gonna send them a message to have a meeting because I need to learn. I need to learn how to raise them. And so I started meeting folks, started meeting folks. And then I had this meeting very early on with Elizabeth Yen from Puzzle Fund. And so first call, we're talking, I'm telling her about it. And in my mind, I set up, I knew I was going to raise 10 million. And so I knew if I raised 10 million or less, I could raise from 249 LPs. So I already knew that. So I started off with a 10k minimum. I said, let me just start off small and just see if I get the ball rolling here. And so I had this talk with Elizabeth and I'm telling her about what I'm doing. And she's like, that's interesting. She's like, what's your middle? I was at 10k. And she's like, I think I can do that. And there was this light bulb moment of, oh, I talked to more GPs. GPs can invest in funds too. And that became my strategy. And so from-

SPEAKER_347: Such a great strategy. I mean, it's literally the strategy that Marc Andreessen deployed, which was, I am going to put 50k into every emerging fund manager.

SPEAKER_258: He did it in my first fund famously. And that'll hopefully blow back to him in maybe as a feeder. So she gave you the 10k hoping, hey, maybe he returns me back 40k. I make a little bit of money or 50k, whatever, two, three, four, five X fund. But what if he sends me the next Uber or the next Airbnb, that would make it worthwhile as well. So what a great strategy emerge emerges. Two things you said that I want to follow up on. He said, one, investing is harder than it seems. And then two,

SPEAKER_305: you said you don't like rolling funds. So let's go through those two questions.

SPEAKER_299: Yeah, absolutely. But one thing I do want to put a pin on. So after my meeting with Elizabeth, that set off this thing where from the middle of June 2020 to the middle of September, I had over

SPEAKER_258: 1100 meetings. 1100 meetings. Yes. If those were 30 minutes each. Yes. Like 550 hours, 550 hours,

SPEAKER_126: 10 hours a day. It's like 50 days of 10 hours a day meetings. That is bonkers. Yes. That's,

SPEAKER_258: that's awesome. What is your goal? Is that like seven days a week? Just 30, 20, 30 minute meetings

SPEAKER_330: and calendar early just stacking them all up. Yeah. I mean, at the height of that, I was averaging 25 to 28 meetings a day. And then I would do like five to 10 meetings on weekends. So pure hustle,

SPEAKER_361: just pure hustle. I'll talk to anybody who will pick up the phone. I love it. I mean,

SPEAKER_258: it's such a great strategy. In the early days, when I was doing my magazine, Silicon Hour reporter, I was like, I just, I don't know anybody. I'm 24 years old in New York. And I would be like, is anybody doing anything on the internet or whatever? Do you know anybody? And they'd be like, yeah, I know like three people doing stuff with the internet or CD ROMs. I was like, can you introduce me? Can I get their phone numbers? And I would just say, Hey, we should meet. And I would just do the same thing you did. I would go to grammar, except I did in person Gramercy Tavern. I would just meet people for coffee. And I would say, I got another meeting coming. You want to meet them? And I'd have them sit and roll over meetings, but just pure hustle. And it's not about how many knows you get. It's about just getting a couple of yeses. So I have those 1100. How many LPs do you

SPEAKER_359: wind up having in your fund? Out of that 1100, I think I got about like 35, 40 LPs that that kind of jumpstarted. And you know, today I have over 200. So one in basically one in 20.

SPEAKER_299: One in 20, yeah, about one a day.

SPEAKER_167: So basically you get 19 no's, one yes. And that emboldens you to say, well,

SPEAKER_326: this sucks. It's not efficient, but it's working. So why stop?

SPEAKER_367: That's exactly what it was. That's 100% what it was. And the average person's putting in 25K,

SPEAKER_258: I'm guessing. And so said another way, mostly 10K checks. Okay, but let's pause for a second here. If you do, if you're doing 20 meetings in a day, or let's say you even did two days and you hit 10K every day, every other day, that's pretty good. That's, you know, as crazy as it sounds, but what's

SPEAKER_126: important for people to notice, to note here is that it is a numbers game. And even an outsider, who's going to have a much lower hit rate, like your hit rate when you're in year 10,

SPEAKER_258: will be one out of three, one out of five. But when you started, it was one out of 25. Okay, that sucks. It's inefficient. But you still got it done through the law of big numbers. It's such a great strategy, which is, I'm just going to flood the zone. I'll just do these meetings until I hit some critical mass. And of course, if you get to 40, 50 LPs, and you're at three,

SPEAKER_311: four million, I'm assuming, then some bigger checks come in, or it gets easier.

SPEAKER_299: That's when the bigger checks come in. That's when it gets easier. And then that was coinciding with my following on Twitter growing. So like, now my Twitter followers growing. Now I've had touch points with a bunch of people in the

SPEAKER_330: ecosystem. So not only are they following on Twitter, they know a little bit about me. And then next thing you know, the momentum starts picking up and bigger checks start coming in.

SPEAKER_373: So that worked out really well.

David Friedberg: All right. Let's go to this question. Yeah. Why is investing harder than it seems?

SPEAKER_299: Because everybody thinks it's just you're investing just cool companies, just cool products, right? There's so much more that goes into it, right? You know, the market size, the team, people don't understand like how many versions of the same product I'm gonna see time and time and time again, right? Like, I'm so happy that the fellows from Squire are the company that is crushing it.

SPEAKER_375: I met like well over 80 other barbershop apps, right? All right.

SPEAKER_378: There are a lot of barbershop apps and salon apps even more.

SPEAKER_299: Yes. And like, if like, I've heard the same pitch a bunch of times, you're going to tell me how great it is, how amazing it is. It's like, yeah, maybe. Yeah. But then, you know, also you got to do the math, you got to do the digging, you know, you're really good at, you know, like tabletop math, right? As the company's talking, being able to start really putting down like, okay, how much is there burn? You know, how much is the envelope? All that kind of stuff. And you got to be proficient in it, right? Because you can't get caught up. And a founder like myself was really good at storytelling. They tell you this amazing story to get you all hyped up, but the numbers aren't there. Right? That's a trap. That's an easy trap to fall into.

SPEAKER_258: I always tell people that when they get excited, I'm like, do not commit in the room. Because let me tell you, founders self-select for incredibly charismatic individuals. And then they get rewarded for being charismatic. So they refine and sharpen that skill. And they get, you know, they're doing the 1100 meetings as well. Maybe my, you know, many founders I work with are doing two or 300 meetings. They're not doing 1100. If they did 1100, I think they all clear market. Because at least after the first couple of hundred no's or very few yeses, you're gonna get a lot of good feedback as to why you're getting the no's and you can get smarter and refine your product. But it does take a lot and they are charismatic. So you're going to have to let the reality distortion field kind of dissipate. And then all that's left is a fact. Who are the customers? How many are there? How much are they paying? What's the margin? What's the unit economics? And so and kind of really refined. And actually, I had Squire CEO, Sanj, is that his name? Sanj Lauran? Yeah. On episode 1131. And that was really impressive. And he's doing great. So you didn't like rolling funds. For people who don't know, rolling funds are quarterly. I think it's quarterly commits. And then people you get bundled into it's very innovative concept. What did you like about this? Why wasn't that right for you?

SPEAKER_359: I didn't like the way they did LP returns, right? So I knew early on that some of my earliest LPs were

SPEAKER_299: going to be true supporters and people who have followed my journey for the last decade from time as entrepreneur to now. And you know, they're going to do 10k 20k checks. And so if I put that in the rolling fund, the most they could do is four quarters. Well, if I find my best company in Q and quarter six, they don't get any of those returns. So if you're going to be my first backers and my first funds, I need you to get access to the best companies I do out of that portfolio. And so for me, that was just that was a nonstarter.

SPEAKER_399: And you wrote a blog post, Lions Tigers and rolling funds on my why we ultimately decided not

SPEAKER_258: do it. I kind of like that reasoning. It's, it's against the interest of the LP because they might if they just happen to miss a payment, or they just said, I'm taking a quarter off, or they were like, oh, they put up this, none of these companies have worked the first four quarters, I'm taking off the fifth and sixth. And that's when you hit your Uber or Robin Hood or calm. Now it's like, ah, yeah, and I have people who are in my life who have done that as well. All right, let me ask you a question. You mentioned earlier, you're a black man from Baltimore. Correct. So I can confirm that you're a black man from Baltimore, as a white guy from Brooklyn. Let's just be honest about this. Everybody says the industry is a bit racist, biased, the dollars don't go to a perfect distribution of, let's say the demographics of America far from it, perhaps. And then you have, you know, incredibly horrible moments of random racism, bigotry, sexism, etc, in our industry, or any industry, right? But you got it done. So what is your take on where the industry is in 2022? In terms of equity, equality, whatever, just the ability for a black guy to raise a $10 million fund, because you did it. But I guess maybe if you're a white guy from Stanford, it'd be a little bit easier. I don't think we would be the rest would argue with that. But you did it nonetheless. So how do you feel about the industry? Candidly,

SPEAKER_299: there's there's a there's still a lot left to be desired in the industry, right? Like it's still hard, right? And, and you know, I had some factors working for me, as I moved in to raising my fund. And, and a part of that was, so here's the weird thing about how I raise my fund, right? So like 80% of my LPs came from interactions on Twitter. Thank you for 506c and the jobs act. Cool. Here's the other two things that happened. COVID. So everybody stuck in their house, so I don't have to pay for travel. So I can do all my meetings on zoom, right? And then to George Floyd happens. So then there were a bunch of diversity initiatives from LPs, especially corporates. And so there was a lot of diversity initiatives that aren't doing any more investing. They did their initiative and it's gone. I just happened to be in that timeframe. One of the interesting things about when I raised my fund was when I quit my job working for the state of Maryland to go start the fund, I had less than five grand in the bank, in my bank account. Right? Like that is not something on a roadway. Like, like, you know, I don't have a GP commit cause I couldn't afford one. Right? Yep. Like I got here. Explain to people what the GP commit is and why that's actually a bit of a hurdle for folks. So your GP commit is anywhere from one to 5% of the fund that the fund manager needs to put in themselves, right? This is the same thing for, you know, when, when investors talk to entrepreneurs, they ask them how much of their own money have they put in their company? Cause they want you to have skin in the game. Right? Right. And so the idea is, well, if you're raising a $10 million fund and you put a hundred thousand dollars in,

SPEAKER_330: you're investing your own money as well. So you're going to be prudent with my money

SPEAKER_423: because you're being prudent with your own money. Right. And so this is a major hurdle because if

SPEAKER_258: you're coming, I mean, in your case of your fund, $10 million fund, we're talking about a hundred to 500 K and you know, I had sold one of my companies when I did my first fund, I think I was two, three, 4% of the fund. So I was two, three, 400, which I was like, okay, I gotta, you know, I gotta put up or shut up. If I'm going to be betting their money that I gotta have something in it, but I would never have been able to do it 10 years earlier. It is a limiting factor. That's something that in first time funds, people should change your expectation. I think there should be no expectation of a G key commit in that first fund, because if we want to have more diversity in this, but there also seems to be, uh, and I don't know if this is because of people's guilt slash, uh, awakening during the murder of George Floyd. Uh, let's be honest. It's a murder. Uh,

SPEAKER_417: and you know, it's tough to watch and it's tough to talk about. It's tough to talk about this issue, period, but it's important to talk about it. So we should have the dialogue.

SPEAKER_293: We're in the shadow of this, you know, tragedy with George Floyd's murder and people are feeling

SPEAKER_258: guilty. Maybe they're having a bit of an awakening to, Hey, maybe 2021, but as much as we want to believe that we're living in a post race world or post racism world, which something I kind of believe we were trending towards. Then you see George Floyd, you're like, ah, not really. It's still pretty bad out there. Um, people correct me wrong. We're more interested in helping. And you're in this, like you said, it's a really astute point. Everybody's willing to take meetings on the phone, uh, over zoom. And before that I was like, ah, I don't want to get on some janky software to do a teleconference. No, that's too hard. It never works. Come to Santo road. It's coming to Santa road. It's going to cost you five grand and you only got five grand on runway. So it's amazing. Those two confluences of random events actually wind up helping you. That's exactly what it was. Yeah. Uh, pretty also depressing

SPEAKER_119: that we have to see the murder of a black man in order for other black men to get the opportunity.

SPEAKER_330: Yeah. When, when people ask me about my career in venture,

SPEAKER_299: I tell them that my career in venture was sparred on by the killings of two black men, right? So the crazy part was I told you, I worked at that marketing firm and I quit. Well,

SPEAKER_329: the week Philando Castile got shot and killed in his car for legally having a firearm was the same week that organization started soliciting the national rifle association, which has a history of not

SPEAKER_299: supporting black gun owners. And so I quit that job on a Friday and the very next Monday, I get this email that the investment arm of the state of Maryland is hiring. So that's why I get in the VC. And then when I go to raise a fund is after George Floyd. So that's been my journey.

SPEAKER_258: It's a bit threading the needle. I'll be honest, like you barely skated through like two, you know, really unique moments in time, but here we are. And we're seeing a lot of other people now watching you and before you Arlen and before you Elizabeth, even a woman of color. You know, it's we're seeing a great change occur and the tools are out there. And I think it's very interesting, the public,

SPEAKER_126: because of public solicitation, the public really wants to see this change. But if you wanted to see this change previously, it was all occurring, you know, in the back rooms. And now you can actually

SPEAKER_258: support the change you want to see in the world on Republic or seed invest, or if somebody is just tweeting, it's actually pretty rad. I have to say, because I tweeted the other day, how I was like, so impressed, and people took it a little bit the wrong way. I was tweeting like, God, it's like, you know, when you're like an internet celebrity, like you are now and like, you can just have you can meet LPs on Twitter. I'm so jealous that I filled up my funds with 250. You know, you have a 250 cap for people who don't know, it's just a technical thing. You can have 250 investors or 10 million, but not both of accredited investors. QPs, you have unlimited asset. I don't even know if I could even do a public solicitation now, because all it would do is frustrate people. And you're going to quickly be at that point. Now that you have 10 million and 250, you say you have 200 LPs in the fund or so? Yeah, 200 LP. And you hit the 10 million cap. Yeah. So now you talking about raising when you do your

SPEAKER_326: next fund, if you do a public solicitation, and everybody from your last fund does their part or

SPEAKER_439: more, you're full. Yeah. That's super frustrating. So like, there's gonna be a bunch of people who are in fund one that won't be able to be in fund two, because the goal for fund two is to be significantly

SPEAKER_330: larger is going to be more institutional. But hopefully, my goal is to set aside a few seats for

SPEAKER_299: smaller checks, right? Like, I want to keep access open, but the SEC rules are what they are, right? And short of us working hand to hand with SEC and lobbyists to get these rules changed for now, this is what it's going to be. And hopefully, one day, you know, we help that change happen. But, you know, my goal is to be the next NEA, the next Greenspring. So we're gonna have to change it up a bit.

SPEAKER_445: Well, I mean, if you think about it, the other possibility, and I've thought about this myself,

SPEAKER_258: is to just make a vintage. This is max 2021 fund, this is max 2022 fund. And you can keep it at relatively the same size and just tell people, listen, it's not exactly a rolling fund, but the funds will not be three year funds, they'll be yearly funds. And so we're just going to maintain the vintages based on year. And that's something I've been thinking about as well. Is your fund and your thesis to invest in the greatest companies in the world? Or are you trying to back specifically underrepresented founders? Because this is another, you know, I think challenge everybody expects because you're a black man, okay, you're going to back all black men, or black women, and just you're going to be going for the underdogs, the underrepresented. But then that means you're narrowing the number of people you would invest in to a smaller group of people, which means it could impact your returns, which means it could impact your ability to do other funds. And I had this conversation with Arlen, she's like, listen, I'm doing black women, that's it, you know, underrepresented women. And I was like, well, what if you meet a white guy with a great idea? He's like, go find another fund, there's plenty of funds for you. And I was like, well, what if that white guy happens to have the best returns? And she's like, well, I'll figure it out. And I was like, okay. What's your take on that? Because

David Friedberg: you could be muting your returns if you limit yourself to just a subset of people.

SPEAKER_359: Look, I completely respect folks like Overlooked, Backstage, Harlem Capital, Colab. Like,

SPEAKER_299: I love all those folks. And all those folks are my friend. I do not have a diversity mandate, right? I invest in companies primarily outside of major tech hubs, outside of Silicon Valley, New York and Massachusetts, pre-seed to seed. You know, that's pretty much it. You know, that's pretty much where I am. Because like, my job fundamentally as an investor is I have nothing more than a glorified financial advisor. Wealthy people or people of means give me their money to make them more money. That is my job. And that is how I'm benchmarking. So if I was to ever meet a young kid by the name of Mark Zuckerberg, who was telling me he's building something crazy called the Facebook, it is literally my job to give him money. And if I don't, my LPs are going to look at me like, oh, what the hell is wrong with you? Right? So like, for me, I'm looking to back the best

SPEAKER_258: cost, the best companies possible. You know what, and that's what Henry from Harlem Capital was on This Week in Startups episode 1183. And he was saying something very similar, which is like, listen, we're in the business of taking this amount of capital and xing it, whether it's three, four, five, six, seven, hopefully 10x, whatever it takes. And so you can still have that focus, but you can still be opportunistic and back a great founder. I think it's smart. There's no reason to handicap your returns, potentially by walking away from some great founder who happens to stumble into your office, you know, or into your line of sight. One of my favorite founders is a gentleman

SPEAKER_299: by the name of Charles, who runs a company called beauty by me out of Tennessee out of Memphis,

SPEAKER_330: Tennessee. No, he's a 25 year old white guy who out of Memphis is just as much as a underdog as me as a black guy coming out of Baltimore. Yeah. You know,

SPEAKER_460: he's got an incredible company that's going to disrupt the beauty industry, right? And like,

SPEAKER_330: I'm I am honored to support a founder like that. What categories you like to invest in? Because I

SPEAKER_258: noticed that a lot of folks who are new to getting into VC, maybe a lot of DTC products, or non traditional, you mentioned one with hair weaves and getting them dry. A lot of these businesses maybe aren't software, so they don't have the same margins, they're not marketplaces, they're not SaaS, and they're not consumer subscription, or they're not FinTech. Those four obviously, are like blow the doors off returns. And then DTC, which I've done plenty of DC companies, also very hard hardware, very hard. And sometimes we see people who are new to entrepreneurship, lean towards non scalable businesses. And that's a constant struggle. First time founders always pick something non scalable. Second time, they're like, Okay, I'm gonna do something scalable this time. I'm not doing hardware, I'm gonna use somebody else's hardware. So how do you what do you like to invest in? Do you have specific categories that you see overperforming?

SPEAKER_299: We've done a bit of beauty and FinTech. But at the end of the day, the way I think about quality deals. I don't necessarily care about like, actually, like I need to care about valuations and stuff like that. But I got to tell you, though, the one investment that we made that I hope that my LPs love the most is an investment in Main Street. Right? Like we got to invest in Main Street second round. And as you know, that was a huge round. Explain to me what Main Street does. Yeah. So Main Street is a company that helps startups and companies find tax credits, right? So they help you. So like, if you're a company, you go to MainStreet.com, you fill out some information, and they find you free money, I guess living about their business miles to find you free money, right? The company is one of the fastest growing companies I've ever seen. The founder Doug is one of the most impressive founders I've ever met is the most Silicon Valley of Silicon Valley companies you could ever see. And we put a very small check on the cap table at a really high valuation because that company is going to be a winner. And I always go back to it because like one of my mentors loves to tell the story of how he met this company that he really liked and thought the founder was great, but it had a $600 million valuation he thought was too high. That company was Uber.

SPEAKER_399: Yeah. Yeah. I mean, Shervin famously did the Series B at 300 or something, and people thought he was crazy. And it worked out, right? Yeah.

SPEAKER_299: So like, the way I think about is, I don't think about industries or anything like that. I think about quality of deal and business fundamentals, right? If you show me that you know how to find customers, customers buy your product, they keep coming back, you got going margins, and you're in a large market, you probably got a shot to win. I don't need to necessarily know all the other ins and outs because that's how I help take my own biases out of it, right? And that's how if I ever meet a company like specs, you do that deal, right? Like, I don't know much about hosiery, but I see these numbers, and I see women keep coming back, and I see it growing. And there are a lot of women in the world who wear hosiery. Oh, let's give that a shot. Like, that's what I'm always going after. That's

SPEAKER_305: what I'm always trying to do. Amazing. And shout out to mainstreet.us slash twist, get 25% off. They've been a sponsor of this program, in fact. Good for them. Priority on

SPEAKER_160: morning, yada, yada. You have strong feelings about investor updates like I do. What have you learned about investor updates? Not all of them are good. Not all of them are

SPEAKER_299: quality. Too many founders are trying to hold back or hide things, right? Like, tell me your numbers. Tell me, tell me about you doing your bank account. Like, if I've given you a check, tell me how much money you got in your bank account when you give me updates. Yeah. Right? Like, show me what's really going on. Because all I'm going to do, because a lot of founders just send you an email and just tell you all the great things, all the conversations we're having. Thank you to all the people who helped. And oh, by the way, we missed one deadline, but we explained it away. It's not that big of a deal. Right? Like, no, be honest and real with me. Because the more honest you are with me, the more I can help. Right? The more you hold back, the harder it is for when things actually get really hard for me to be like, well, why didn't you really explain this in that last update? Like, I've read the update. I sent you an email, say, good luck and good job. Keep going at it. Let's catch up soon. And then I had to chase you down to catch up. And then when I get there and I ask you about the numbers, they're not adding up. Stop doing that founders, please. Like, the more you give us, the more we can help.

SPEAKER_258: I mean, it's amazing. Sometimes founders lead and they fill these long, they don't send updates, then they send a really long update, then you get the long update. And you're like, okay, here's a bunch of conversations that they had. Okay, well, what are those conversations actually result in? Where are the customers? Where are the usage stats? Where's the revenue? Where's the

SPEAKER_126: runway? What did you burn? Let's get some bearing on, hey, if this is an airplane, what's our altitude?

SPEAKER_258: How much fuel do we have? Where are we landing the plane? How many passengers are on it? Like, let's get some data about how this plane is flying before we talk about how great like the cocktail service and peanuts were like, yeah, we get it. The peanuts were warm. Great. Let's get some reality in the business. And that's where like, all of these soft metrics. Oh, we spoke at this conference. Oh, we won the startup award. I'm just like, I will tell my founders, because I'm super candid. And that's kind of my brand. I'm like, every time you put in a soft metric, it makes people believe less in your business. Because it makes you look like you're not focused on what matters. When you put 30 under 30 nomination vote for me nonsense, when you know, and you're putting in, you know, somebody want to start up award or somebody gave you some great feedback, whatever, like, what about customers? Can we talk about the customers? Can we talk about the people using the software? Let's get focused on what matters, folks, you know, and I would rather see a short update

SPEAKER_482: with a lot of facts than some long narrative with no facts.

SPEAKER_484: A hundred percent. A hundred percent. And, you know, founders don't understand how much of a detriment they're doing themselves when they do that.

SPEAKER_482: You had some strong feelings on products and design. Maybe you talk a little bit because I, I too, am a design snob. And if the product does not look good, I'm like, it's 2022, folks 2021,

SPEAKER_258: whatever, like, you can't produce a five out of 10 product. You know, this is not, you know, 10 years ago.

SPEAKER_489: You, you need to have a quality product, at least from a visual standpoint, right? And usability right

SPEAKER_299: behind it, far more than you needed like a decade ago, right? Lean startup comes out, ship something ugly, learn to get better, right? Now, when you ship something, it shouldn't be ugly, but don't need to be perfect, right? And I think that's the big thing. But then also, I think when people talk to me about product is I don't care as much about products as I care about customer acquisition, right? Because what I know is the best product rarely wins the market, right? I've seen tons of amazing products that I thought were better than anything on the market that I love that these entrepreneurs put their hearts and souls at the building that never went anywhere. I see companies like that every day, right? But show me that you know how to get customers, that you know how to give people a feeling, that you know how to get people keep coming back. That'll give you the runway

SPEAKER_258: to fix your product to have a great product, right? A little market pull goes a long way. If people really appreciate the product, they tell their friends about it, get a high net promoter score. And it's gonna be cheaper, it's gonna be cheaper to do paid marketing. If it's a great product, then you have less churn. So it becomes more efficient. Do you have now that you're on this journey and you're in your you're going at a nice pace in terms of investing in I think a couple of startups a month, two or three a month, maybe something like that pays? Yeah. Have you started

SPEAKER_407: to click into the personality types that you like to work with and that you see have a better chance of

SPEAKER_446: winning? It's the founders who have a chip on their shoulder, kind of like this underdog story who

SPEAKER_299: like, they will do whatever it takes to get where they need to be to the point where, you know, sometimes they tell me what their goals are, what they're going to do. I'm like, you sound crazy. And then two months later, they do it. It's like, maybe I was a crazy one, right? Like they helped me get to a point where it's like, I'm I can anything they say, no matter how wild it is, like, I'm just going to believe them. Like, yeah, you know, tomorrow, we're going to build a rocket to the moon. Okay, send me pictures. Show me how it goes, right? Yeah. And you know, sometimes they're the founders that people think are crazy, right? Like, if other people are thinking you're crazy, then this might be the right kind of investment for me.

SPEAKER_258: You know, if you're going to do this pure hustle and hard work does go a long way. This idea that you're going to have some sort of life work balance as a founder, and you're up against a bunch of maniac competitors who don't have a life work balance, and they've decided they're going to work twice as hard as you, you know, you're probably going to get beat. It's just that easy, you know, and if you're calling 1100 people to get your $10 million fund done, and somebody else is like, I talked to 10 potential LPs. And, you know, the world's against me, nobody will back me. It's like, well, Mac just did 25 in a day and got one person give him 10k. Like, there is something about hustle and hard work that is undeniable. Now, I don't want to make you the person who has to answer to all stupid white guys tweeting on Twitter. But we brought up the discussion of race in the industry. And then Joe Lonsdale, who's kind of a friend of mine, or I shouldn't say a friend, but we're friendly. We know each other from the industry. We haven't like I don't know his kid's name or anything. But I have seen him and met him 1020 times decided he'd say some stupid stuff on Twitter. I'm certain you've seen it. Yeah. And I'll just read the tweet. There he responded to

Chamath Palihapitiya: somebody that's one dumb hypothesis rate baiters have taught you a real view average black culture

SPEAKER_258: needs to step it up and stop having as many kids born out of wedlock, statistical indicator of underperformance, who don't value education or spend much time on homework.

SPEAKER_505: You see this tweet from a prominent VC. Where's your thinking?

SPEAKER_299: I feel bad for him. I tweeted and said, like, I feel bad for people who have gotten caught up in

SPEAKER_330: propaganda, right? Like, you know, if you look through the Nixon and Reagan errors of this country, there was a lot of information put out, some by the government, some through other means,

SPEAKER_299: to create this narrative around what a black person in America is. It's just fundamentally not true. And even if you talk about, you know, don't care about homework, right? So if you live in Baltimore City, you have a high school education, you graduated, let's say, top 20% of your class, you couldn't get into any public school or didn't have money going to public school. So then you end up working in a community like Sanchester Wintown in Baltimore.

SPEAKER_315: Know what the median income for Sanchester Wintown is? 17,000. That's the median family income.

SPEAKER_506: Yeah, that's not single income. That's the family.

SPEAKER_299: That's the family. So that means these people are working crazy jobs, they're doing gig work, they're working at the local McDonald's, local Burger King, they're making minimum wage at best, basically, at two or three jobs. So when you're doing that, when do you have time to help your child with homework, right? You're just trying to make sure your child has a place to live, right? You know, I have family members who don't know what it feels like to have electricity every day, running water every day, have a meal every day. Hell, I've had parts of my life where I didn't have meals every day, right? But then that's not the story for every black person also, right? And even when you talk about out of wedlock, honestly, there are as many black people who

SPEAKER_330: don't have a father in their life. There are 10x the amount of white children who didn't grow up with their father in their life. The only difference was we call it divorce.

SPEAKER_512: Yeah. And granted, they might not have seen their dad for 10-15 years, but they'll tell

SPEAKER_513: you I had a dad, you know, I'm different. No, it's pretty much the exact same situation.

SPEAKER_74: Yeah, it might be similar. Yeah. It was like such a dumb tweet from Joe. And, you know, I tell him that to his face. Like, you know, I'm also trying to think of like, what's the intent of this

SPEAKER_490: tweet here? You know, like, what is the goal here?

SPEAKER_439: I don't know. I don't know what his goal is. I guess he figures if he tells people,

SPEAKER_330: in that kind of a blunt tone, we're going to pick ourselves up by our bootstraps. But the question is, what do you do when you don't have bootstraps? Or you don't even have boots?

SPEAKER_439: What are you supposed to do?

SPEAKER_258: It's something that I've had to give a lot of thought to, because I always thought, you know, I started from behind the eight ball. Because, you know, I was like, well, I'm the poorest kid I know, or amongst the poorest kids I know in my school, and we're barely getting by. But then again, my parents do own their house, even though they're behind on their mortgage, or we might be running out of money. Like, it was not as dire as the person you described, who's working minimum wage to just try to stay. And my mom was a nurse, that's like a good job. And so I think it's like a poor lesson for people,

SPEAKER_482: certainly one I had to, you know, really let sink in, which is as hard as you think you had it,

SPEAKER_258: there are people who have it harder. And then even in America, as hard as we think we have it, there are people in Afghanistan, or Pakistan, or who knows where South America somewhere, who have it even harder, right? And one of the great things is, I think, having a discussion about how do we get more people to realize there's an opportunity? And how do we, you know, raise the

SPEAKER_482: minimum wage, raise, you know, some of these basic concepts of getting a roof over your head, affordable housing, and education to really help people? Because if you're just trying to keep food on

SPEAKER_258: the table, like, yeah, there might not be any energy left at the end of the day, when you're working three jobs, to actually go sit there and do the, you know, AP math with your kid, right? It's like the height of privilege. So, but you know, I think Joe is a good person who just has a very weird point of view on this. It's like a very weird, like right wing point of view.

SPEAKER_299: Look, I understand where people are coming from, right? Like, like you said, for you, like, if you come up and you feel like, look, I was poor, my family struggled, and I made it. So, if I put in the work and effort, I could get here. That means you, if you put in work and effort, you could get here too. And it's really hard to put yourself in somebody else's shoes to say, well, you knew what work and effort was. Right? I didn't even know that. Right?

SPEAKER_225: See, that's a key insight, I think. Like, I always tell people, like, everything you could learn in the world is on YouTube right now. And you found this week in startups, as but one example,

SPEAKER_258: like to go full circle to where we started. And like, I found the other day MIT course where I just have to stumble upon, like, they had a macroeconomics. And I was like, you know, I never got to go to MIT. I don't, I mean, I understand what macroeconomics is. I've read some books, whatever. I was like, I'm gonna just play this macroeconomics course in the background while I'm doing some work. I started listening to macroeconomics, microeconomics. I'm like, wow, I'm really starting to learn some stuff that are gaps in my own education as a 50 year old guy. But if you don't know that the MIT courseware is online, or this week in startups exists, or core exists, like, that's the thing, I think we have to, there is a knowing the opportunity, knowing that information is there, knowing there are paths, knowing the strategies, and you are an unlock code, you're a cheat code. That's why I'm so excited to have you on. I think it's like a great episode that we can build on from here, because you figured some stuff out. And like, you know, the way you could thank me base, you know, you had that very gracious thank you to me, is you

SPEAKER_417: just keep doing what you're doing, you keep sharing how you did it, right. And if we all just keep sharing how we did it, when I came into the industry, nobody would show you the term sheet, nobody would explain to you how venture work, nobody, you didn't know who worked there, it was all the black box, all the venture webs, venture people didn't have websites. And if they did have a

SPEAKER_258: website, it was like, you know, like, whatever capital partners, you know, and the address, and like, no phone number, and like, you just couldn't get in touch with anybody at those places. Nobody was like, Elizabeth was like, you know, let me get on the phone with you and try to help this person. I think that's one of the most beautiful things about our industry in 2022, is that and a Twitter plays a part in it, podcast plays a part in it, YouTube plays a part in it, everybody really does want to help each other. I feel so positive about our industry, in that, you know, Naval wanted to help me, I helped Naval, everybody was helping each other 12 years ago, try to create more angel investing syndicates, whatever, let's figure this all out together. And I think that's

Chamath Palihapitiya: really, like, one of the great things you're actually doing every day when you're out there,

SPEAKER_258: talking about raising funds and explaining to people how you did it, because the more you help other people, the more it comes back to you, in my personal experience. Yeah, 100%. And I do it because

SPEAKER_330: I wouldn't be here if it wasn't for people like you, there are a lot of people like you,

SPEAKER_299: along my journey who helped me a lot. And if not for them, I don't make it here. So,

SPEAKER_258: you know, I got to do my part. It's, you know, it's life is a random series of events. And sometimes you don't even know, like, you got this boost, or you got this help, or somebody just opened a door for you and really is sharing that knowledge. And then just being a good example, all those things can add up. Listen, Mac, this has been great. We had a full hour, continued success. You're halfway through the fund, a third of the way through the fund. Oh, fully, we were fully committed. You're fully committed. But did you

SPEAKER_474: deploy all 10 million? Oh, yeah, yeah, yeah. We're halfway through the fund.

SPEAKER_323: We're halfway there. You're going a little fast there. You want to pace yourself, kid. Don't blow it. That's when I first started investing. Rulof said to me from Sequoia,

SPEAKER_249: I said, any advice? You know, he said, take your time. Take your time. You know, a lot of times, people get a little excited when they get their first fund going. It's like, pow, pow, pow, pow, pow. They just start shooting. And he's like, take your time. Be a sniper. You

SPEAKER_531: don't need to have it. It's not a machine gun. You can just really pick your spots.

SPEAKER_534: Fair enough. Deal shows are very high and high quality. So, you know.

SPEAKER_482: Yeah, yeah. Well, the good news is you can raise another fund and 506c. If you follow Mac, you never know. You might be able to get in on it. All right. Listen, thanks for doing the first episode of season six of the Angel podcast, and we'll see you all next time. Bye-bye.