Jason Calacanis: Alright, everybody, we have got a whopper of a show for you. If you thought that August vacation extended to the news, that vacation is over.

SPEAKER_02: No, and then I'm going to do a after the news, which we've got a lot of, I'm going to do part four of the blueprint, what it means to have a bias for action.

Jason Calacanis: Everybody loves the blueprint, including me. It is so fantastic. First up, though, we're going to cover some earnings reports that came with some interesting announcements.

SPEAKER_07: Yes, MicroStrategy's Michael Saylor is stepping down as CEO,

Chamath Palihapitiya: going to become executive chair, and we're going to talk about what the plan is there for the Bitcoin holding company with some

SPEAKER_07: SaaS revenue, I guess, I guess the Bitcoin holdings did not

Jason Calacanis: perform that well in q2, as you might imagine down about a billion dollars. So we'll cover that and also Robin Hood laying off almost a quarter of the company.

SPEAKER_11: Yes, doing a riff, not a layoff reduction in force, we talk a little bit about what this means for the company and also the industry writ large. And then we're going to discuss Airbnb

Jason Calacanis: people are just doing the nomad thing and the Airbnbs. And then we're actually going to kick off the news with startup stories. Next up, actually talking about a major player in

SPEAKER_15: the early stage startup ecosystem, Y Combinator shrinking its cohort size by 40%.

SPEAKER_19: Why is that? Why would they do that now? That's we have five or

SPEAKER_09: six theories, we're gonna go through each one of them. And then we'll wrap with my blueprint. It's gonna be a great show. Yeah, stick with us.

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SPEAKER_25: Welcome to the show, everybody. Molly, I saw some news in our group chat that Y Combinator is decreasing the number of

SPEAKER_11: startups in its summer 22 2022 accelerator by 40% from its winter batch, which had 414 startups participating. Take us through this story, which Kate Clark reported in the

SPEAKER_12: information, which of course she did, because she's amazing at

Jason Calacanis: this. Yeah, apparently the summer 2022 batch only includes about 250 startups. YC said the reduction in batch size was due to the macroeconomic downturn changes in the venture funding environment. And then of course, YC going back to in person and Y Combinator has been making more changes to its program. Lately remember, they recently changed the standard deal actually from 125,000 to 500,000. And the information article notes that in June, YC CEO Michael Siebel said that the outfit had the budget to fund 1400 startups under the new standard deal meaning, you know, by back of the envelope math, they've got $700 million to work with. So like, what does this actually mean? Are they cutting the batch size because they're putting in more money?

SPEAKER_33: No, I think what this means is that

SPEAKER_39: also, that's a lot. We have what seven?

SPEAKER_37: Well, I only like to do something because I like to get to know the companies I never aspire to do like this, like sort of factory

SPEAKER_09: farming version of startups, because for me, it's much more personal, right? And so, and you know, they've got, you know, 200 or 300 people working there to do this kind of scale. And I

SPEAKER_18: think it's great that it exists in the ecosystem. Now, that's a

SPEAKER_09: lot. But yes, the, the challenge with this is, you know, it dilutes the brand to have this many companies go through it a bit. And that's caused, I wouldn't say reputation damage. But I do think

SPEAKER_45: people look at YC much differently than they did in the early Paul Graham days when it was, you know, let's say 30 companies, it felt more bespoke, it felt like, you know, if you were going, you know, each of the companies really did have to fight to get in there. And now it feels like, well, they're just getting an option on every company and at the valuation they pay, which

SPEAKER_09: is 2 million bucks. You know, there's no reason not to take that option. So I always say, Listen, if Harvard is such a good school, why aren't there 10 Harvards around the world? Why

SPEAKER_45: don't they replicate it? And that is what Y Combinator did, they went from these 2030 40 batch sizes to 400. So they 10 x it. So

SPEAKER_09: I give them credit for that. Because that means more people get to experience their program, which is good. They get the Y Combinator stamp, then the counter argument people would have is okay, I just, what being a Y Combinator company meant 10 years ago is just different than what it means now, right? It's not that

SPEAKER_07: exclusive. If you're how many about how many cohorts are there a year? Do we know? I think they do to winter and summer they do too. So you got like 800 you had, yeah, over 800 companies just

Jason Calacanis: it was clearly way, way too big, right? I mean, 800 out of every single possible startup all year long is still probably a relatively small number. But it's not it certainly doesn't feel like wildly exclusive at that point. So it sounds like they got too big, maybe unmanageable. And then when they raise the minimum investment, it got more expensive, you know, the way that

SPEAKER_58: works is you get 125 for 7%. And then I think they put the other

SPEAKER_27: 375 in at whatever your terms are when you graduate, which by the way, is what I created, you know, seven years ago with the launch accelerator. So they got that idea for me. And it's a great idea to give myself credit for it. Because a lot of times

SPEAKER_09: when you graduate, giving them more money, you know, helps grow the company, and you can get your 7% to maybe get up to 10% ownership. And I think that's what they saw, you know, they had very little ownership in Airbnb, or Dropbox, or a lot of those great companies by the end. And you know, you the way you win in this game is by continuing to invest. So I think they did everything right in that regard. But maybe they're looking at it saying, well, will we be able to raise another billion dollar fund and keep up this pace, right? Because if they were going at this pace, and they had the budget to fund 1400 startups under the new standard

SPEAKER_00: deal, if you're going through four or 500 per class, that means they have two more classes to go or three more classes to go. And here, if they go down to 200, they got seven classes to go. So

SPEAKER_27: this could be a recognition also of maybe they would not be able to raise as big of a fund in the market in the current conditions, it's possible. Yeah, it could also be that maybe

SPEAKER_09: less people Molly are starting companies. So if less people are starting companies, then maybe they're saying, Well, this is gonna if we try to hit a certain number, which, you know, would be crazy if the quality goes down. So maybe they're saying, hey, we're not finding 400 people that hit the benchmark we're looking for, for a YC company. So let's go down to accepting half as many. So if you got half as many applications, you'd have to lower your standards, just like Harvard might be right have to lower their standards if they went 10x, and YC went 10x. So you know, maybe they don't want to lose it or it could be the when they graduate the other theory I had was if they graduate do they have a hard time raising money. So then

SPEAKER_27: they've just got all these orphans, and then they all come

SPEAKER_11: back to them like, Hey, you know, you there isn't enough VC infrastructure to absorb all the YC companies, right?

SPEAKER_12: That is what I wondered is, what does this say about any potential weakness that you know, there has been this prevailing

Jason Calacanis: theory and TechCrunch, even notes investors have argued that pre seed and seed stage startups are, you know, immune in some ways to macroeconomic tensions, because it's so removed from late stage valuations, but it does, you know, I've been asking you over and over about this like growth, like what comes next thing. And it does sound like it's not different funds, like people just invest at different amounts, and they change how much they're investing. But is there the valley of death? If you send so many baby turtles, like I say all the time that our job is kind of like sending baby turtles toward the ocean, and we know a lot of them aren't gonna make it, but it sounds like there's a lot more birds in the air right now.

SPEAKER_67: Well, or a longer trip to the ocean, a longer trip to the ocean, right?

SPEAKER_27: You know, that's actually the issue is I think a lot of folks a

SPEAKER_09: lot of investors are slowing down their investment pace. You're seeing this in the meetings we're having where people came to us six months ago, it was closing, you know, we had to get on the train train was leaving the station and then the train never left the station, they came back to us and said, Hey, you know, we

SPEAKER_27: didn't close, we made some cuts. And now we're, you know, the business looks a lot different, we raised our prices, we cut our costs, so we doubled our prices, we cut our staff in half, and all of a sudden, we're only burning 25k a month instead of 100. So go, well, that business looks totally different. Maybe we would want to invest in that business, since it's not burning through, you know, 1.2 million a year with 10k in revenue, or whatever it is. So you know, I think a lot of those changes, take a while for people to change their approach to running their business. And as we talked about just yesterday with Uber, turning the dials, great segment, Uber had to make that change. That was a multi year change. Then you we talked about the, that matrix we made the six, the four by four on the, you know, 16 quadrant matrix of like, how much runway do you have? How profitable are you? This is all part of the same theme, which is unwinding what the strategies were in growth to what the strategies are in a bootstrapping environment. We're in a bootstrapping environment right now. And I think a lot of founders and a lot of VCs were operating in a cynically reckless fashion, entitled fashion, reckless and entitled would be, you know, how you would

SPEAKER_09: describe the worst of it. VCs were being reckless with how they were investing in the diligence they were doing the bets they were placing. And yeah, and some VCs were acting

SPEAKER_11: super entitled thinking they would just blow through a fund in 12 months and everything grew up into the right. They didn't have

SPEAKER_45: to be thoughtful. And then founders to were being reckless with the dollars and entitled with the dollars. Hey, this I'm always gonna get my next round. The never ending bridge round is

SPEAKER_09: over. I know people who've raised two, three bridges and each time like yeah, I'm just gonna do another bridge for a million and it's like, and it's gonna go up. So like, what would be the incentive then to be profitable, Molly? Well, now all the

SPEAKER_00: realities here, this reminds me very much of the time when I invested in Uber and Thumbtack, where you just you had four or

SPEAKER_45: five people in your company, you tried to get to 1020k in revenue. And you didn't really get distracted with anything but your product and your customers, right. And so this ultimately will be a good thing for the market. And it seems like a very wise decision for Y Combinator to hunker down and maybe they lay off, you know, half the Y Combinator team or a third of the team, if they don't need that many people to do 400, you

SPEAKER_76: know, that would be the next shoe to drop would be you think?

SPEAKER_45: Yeah. Well, I mean, if you're not going to be doing as many deals, you may not need as many people. Now, if you had all those deals backed up, I'm sure you could, if you have all the management fees there, you could redeploy folks to work on the

SPEAKER_09: existing portfolio. So I'm not saying that that's a likelihood. But, you know, this is the painful stuff. And, you know, I think one of our angel investments Robin Hood is dealing with something similar, which is, you know, when you're reducing your workforce, you know, how do you do that? How do you do it effectively? How do you do it wisely? Listen, a bunch of asset

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Jason Calacanis: Yeah, I mean, I think what we're clearly seeing is, and this is a perfect segue to the Robin Hood story is that no one is immune, right? Like Y Combinator is not immune. We probably aren't. I don't think we have anything to announce about our programs. But you know, it's everybody's in a reaction mode. And yes, news came out yesterday, I think last evening that Robin Hood was laying off something like 20% 23% of its employees as retail trading slows. Remember, back in April, Robin Hood cut 9% of staff, the two rounds in total have cut more than 1000 jobs from the company. And Bill Gurley had an interesting tweet about layoffs, which he euphemistically calls reduction in force.

SPEAKER_27: Well, there's a technical thing here. A riff and a layoff are two

SPEAKER_46: different things. A layoff means you're intending to bring the employees back. So we're laying you off. Markets have changed. Well, really? That's technically my understanding of it. Yeah, I didn't know it

SPEAKER_90: either. But since people are using riff riff is like you're not

SPEAKER_27: coming back. You know, and layoffs can become riffs. So that's why

SPEAKER_02: people use this term riff. Because you're reducing the workforce permanently. Because market conditions have been so severe.

Chamath Palihapitiya: I did not know that that is fascinating. Alright, well, then let's I didn't know it either. I just I was trying I literally

SPEAKER_27: typed into Google riff versus layoff. Because I yeah, I hear one group, I think the elder statesman, you know, kind of call them riffs, because they've been through this before. It's like, these people are not coming back. There's also the term

Jason Calacanis: furlough furlough is like, you definitely could just be brought back layoff, it seems like the position might continue to exist, even though you personally might not come back. A furlough, I think force seems to be I'm looking up on Indeed. Yeah, is

SPEAKER_12: furlough is 10 positions gone. Yeah, furlough is like, if I

SPEAKER_09: said, Listen, you know, and I did see this happen to the dot com, let's say, let's say Y Combinator said, Hey, listen, we need to cut costs by 15%. We're going to furlough everybody for three weeks in the summer, three weeks over the holidays, you're not going to get paid for six weeks. So, you know, that's just the nature of this. So your salary is going down by, you know, approximately 13%. And, you know, people who work in unions, or

SPEAKER_02: they work in Hollywood, it's basically unpaid vacation. And you know, what kind of cool, sometimes people really like that furlough better than a reduction in force a riff. So if I were to say to our team, hey, listen, we've got to make up

SPEAKER_09: this, you know, whatever, everybody's gonna have their salaries reduced by whatever 5%. But you can get that time off

SPEAKER_106: people would be like, am I gonna leave the job? Or do I want to get more time off? Right? Like, if I'm thinking about I'm like,

SPEAKER_107: can we do that? It sounds good to me. I'd like to see more

SPEAKER_110: days. But fuck it. I mean, if I went to everybody in my company, you're just gonna furlough yourself, like, I like to be furloughed, I take a furlough. I mean, I think a lot of

SPEAKER_112: people have you said, we're gonna take from this economy sucks. It's brutal. We're taking Fridays off. Everybody's taking a 20%

SPEAKER_114: pay cut. But Fridays off. Not counting your vacation days

SPEAKER_118: like I mean, literally every Friday is like, it's not a hard day. No, we can take two shows on Thursday. Bank an interview.

SPEAKER_112: Summer Friday. If I did a furlough I mean, I literally, if I did this as a vote. And I said, Listen, there's 10 Fridays, we

SPEAKER_91: work 250 days a year, whatever the 260 days a year 10 is whatever that is. 1%. No 10 is 3%. Everybody 3% pay cut or every

SPEAKER_120: Friday off this summer. What do you take? I know where that

SPEAKER_102: vote's going. Totally. Although honestly, in this company, everybody would

SPEAKER_123: just work anyways. Everyone still work Friday. So yeah, so

Jason Calacanis: maybe not. But yeah, you're right. I looked it up on indeed reduction in force employee termination when a business decides has no further need for the position. A layoff is considered temporary. If there are budgetary changes, they can lay off the employee, but the company still needs the position. So the position may continue to exist in the HR hierarchy, even though you the person who got laid off might not be the one who gets hired to fill it in the future.

SPEAKER_127: Fascinating. All right. So Bill Gurley, also, by the way, with the precision.

SPEAKER_45: Yeah, I just want to make one little note here. This is all very important for founders to understand when they get to call it hundreds of employees. The reason is there are very local acts. One of them is called the Warn Act worker adjustment and retaining notification act. This is for any employer, if you know, nonprofit, public, private, whatever, you got to

SPEAKER_27: give 60 days notice of riffs. And there are tons of nuances. But it's just important to understand that you have to give notice. Now for tech companies, they've been so generous with severance of 60 days, you know, people give six months sometimes like, so it doesn't apply. But I remember back in the day, there were some companies during the dotcom era, that crashed so quickly, that the Warn Act and other things were brought up, because they had only given four weeks, it used to be in the industry, you gave four six weeks of severance. And people are like, man, screw these tech employees, six weeks severance, I only got two. And then, you know, employee, the cash in our industry was so great. And these

SPEAKER_137: war chests that people started giving absurd six months severance for employees who could be hired the next day.

Jason Calacanis: Actually, the Robin Hood severance says people can stay on till October 1. So I'm assuming that's probably Warn Act related.

SPEAKER_27: Or, you know, one way to do these is you can, okay, it's another one, that's a little bit weird. You can tell people we're going to get rid of your position, you're going to get one week of severance for every year of service. I think that's like the tip. That's the that's what typical industry standard. Yeah, pretty standard. So you work here for three years, you get three weeks of severance. Or you can work your job for the next three months. So you can pick, but if you do work the three months, you get 12 weeks, but you don't get three weeks of severance on top of that. So for businesses that are actually not like, you know, have 10s of billions of dollars or billions of dollars in cash laying around, that's typically how they do layoffs is they'll give

SPEAKER_00: you the choice. Now it could be too weird, because now you have people in the factory who are losing their jobs, and you get this like 12 week goodbye. That's a little weird, awkward.

SPEAKER_12: Yeah, I'm nice to say goodbye. Yeah. I'm a little surprised that Robin Hood is keeping people on through October 1 only because my sense of kind of like when you

Jason Calacanis: have reductions in force in an industry like finance, that usually it's sort of sensitive, sensitive enough that people are like, out the door.

SPEAKER_09: Yeah, it could be you know, you do always have this like, is somebody going to throw a wrench into the machinery? And that's why most HR people go with the, you know, you're, you're no longer working at this company effective immediately, you know, when you go back to your desk, like, your email is not going to be turned on, just because you really don't want an employee to make a rash decision. That's not so much to protect the company, I think, because the company usually is

SPEAKER_27: going to be fine. It's actually kind of to protect the employee, you don't want somebody to, you know, go digitally

SPEAKER_11: postal, where they, you know, decide to tweet from the corporate accounts, I think, and then you got to sue them, or they take a client list,

Jason Calacanis: start insider training, like crazy, right, trade trading, like they're just front running trade. I mean, it's sort of like, that's a

SPEAKER_15: Yeah, that's an interesting, that is a very interesting choice to me in this specific case, because like,

SPEAKER_29: but Oh, disclosure, I was an angel in Robin Hood, I still own my shares. Yeah, exactly. I'm not trying to put you on the spot here.

SPEAKER_45: No, no, I just want to make sure people I don't have any inside information. The last time I talked to Vlad, I believe was when he was on the podcast, an all in during the whole GameStop

SPEAKER_75: stuff.

SPEAKER_12: Yeah, Stan Hope is saying Molly's dead, right? No financial company has people work out their severance. So maybe they're in

Jason Calacanis: different roles. I don't really know. It could be different roles. It could be it's also and then Bill Gurley's note about this. Okay, back to Bill Gurley's notes. Yeah, back to Bill Gurley's note. He said, if you're planning an RIF or reduction in force and haven't executed yet, please see this as a lesson. Robin Hood did 9% in April, and now 23%, 5 to 10% riffs are all of the pain and none of the gain and are frequently followed by a 20 to 30% rift later, if you're gonna do it, try to do it only once. So he was saying Robin Hood should have cut

SPEAKER_27: deeper sooner. Yes, I mean, that's, it's, it's good advice from, you know, Obi Wan. He's been around for a while. Venture Obi Wan, aka Bill Gurley is right, you know, and the more I get to

SPEAKER_09: know him, or, you know, I'm friends with him. And the more I see him actively talking about the stuff, more respect I have for

SPEAKER_27: him. It's a hard thing to do, though. I've been there. When I did my first layoffs, I did three. When I did my second one, I did one. And I, it's just hard to take the medicine because you know, you're a founder, you optimize and yourself select for

SPEAKER_91: hope, believing you can get out of it. And I believed I could, you know, get out of the tailspin. And I couldn't, you know, and the problem is, you don't want the tailspin to, you know, get really, really, really bad. And everybody dies. In this case,

SPEAKER_165: everybody dying is a metaphor for losing their jobs, not actual.

Jason Calacanis: Yeah, it's no, I mean, you can 100% empathize with you know, Bill Gurley is basically saying, like, suck it up and take your medicine if you haven't already. And you can, but you can also 100% empathize with the idea that you want to believe that that things are going to get better or aren't as bad as as they think. Robinhood CEO Vlad Tenev wrote in a blog post saying the previous layoffs did not go far enough in helping cut costs. He also said, quote, The reality is that we over hired in particular in some of our support functions. And then Robinhood also moved its q2 result up a day earlier than scheduled revenue was $318 million down 44% year over year out net loss 295 million. That was 200 million less than it lost in q2 2021. And monthly active users and this is that real, you know, number in terms of slowing growth, we're down 34% year over year,

SPEAKER_09: which makes sense, you know, they, they had gotten to 21 million, I think was the peak, if I remember correctly, another 14 million, you got to think 25% of people 50% of people who were involved in stock or crypto trading, over over the boom years, would take a break. And maybe it's not for them, right, right. And so like, they're gonna Peloton users, or I think match had a tough time with the reopening and dating is changing. So this is these are the swings. Now, what will happen is I'll be J trading Robinhood will become a sponsor of J trading, hopefully. And since I'm using it to do my J trading, you're gonna single

SPEAKER_170: handedly keep it alive. And yeah, we'll just have a million.

SPEAKER_09: Yeah, monthly actors will go up a million a year as I J trade

SPEAKER_34: with J trading is this SBFs moment, by the way, is this one Sam Bankman Freed is gonna swoop in and buy it?

SPEAKER_171: Um, what's the market cap right now? 9.1 billion 6 billion, I

SPEAKER_09: don't know if they have that's always something to look at. Remember, I was looking at snap and I found it very attractive because of the 5 billion in cash, and then somebody DM me, I was like, check the debt. And they had like 5 billion in debt or four or 5 billion in debt. And I was like, wait a second. So the cash they have is debt, they drew down. It's like, Yep. It's like, Oh, okay, I'm learning something about J trading. There's the valuation. There's the cash on hand. And I always do my little fun math, you know, okay, it's worth 9 billion, they got 6 billion. So the enterprise value is 3 billion with 14

SPEAKER_91: million folks. Well, I don't know what the debt is at Robinhood. So I take the cat, you got to take the debt out of the cash. Because I got to pay that back. Right?

SPEAKER_12: Totally. I'm looking I don't see anything at the obviously at this

SPEAKER_27: moment, no discernible that we can see the brilliance of the Robinhood team, they cash themselves up when they could, when you can get cash in the bank and sit on it, you know, like Apple, Google, Amazon, everybody who's got this cash laying around, you know, you don't have what's called the risk of ruin. And bankroll management is one of the keys to being a great gambler. You have to know how this is one of the reasons I haven't really gotten

SPEAKER_45: hurt playing in high stakes poker is because I have an idea of what my bankroll is, I set goals for myself and you know, I become more cognizant of it. I have other rich friends who maybe are less cognizant of it. And I at times have been less cognizant of it because the money doesn't matter to me. But you know, it's, it's big

SPEAKER_11: numbers when you're playing a big cash games. And you do need to be, you know, eyes wide open. And you shouldn't play in games where you have what's called the risk of ruin. So if your net worth was $100,000,

SPEAKER_45: and you were, I was playing in poker games where I saw people buy in for $100,000, like their entire net worth was on the table. So they can have the best hand on the flop, or even on the turn, and then the other person has one out, you know, so somebody's got a set of aces to have three aces, the other person has a set of kings. And, you know, you got all your money in good, and then that person hit the king on the river. And now you've lost your entire net worth. Now, if you were playing with 10% of your net worth, the chances of that happening that what's called the case king, the final king in the in the deck, it's a 2% chance of that happening. Well, you can survive it because you have the other 90k, right, you played perfectly, you want to be in that situation, you're a 98% favorite, great, but you do have to watch out for the risk of ruin. And like companies like Peloton and Buzzfeed, as we've been looking at them as potential J trades, do have the risk of room because they could run out of cash. Yeah. And that's really the danger. And that's one of the reasons why I'm still long robbing and I didn't sell my shares, I might buy more shares, you know, I think

SPEAKER_182: they're a brilliant product, brilliant team, still the best product in the market. And I think they will get bought potentially, hopefully, they can defend themselves against getting

SPEAKER_183: bought and keep building this for 10 years. That's my

SPEAKER_12: hope.

Jason Calacanis: I mean, $6 billion in cash is a really big moat. As you've been saying the stock is up over 13% today as a result of the reduction in force news investors do like that kind of discipline. So you might have missed your chance to get a deal on the J trade.

SPEAKER_18: I mean, I have some already, but I think it's a good J trade

SPEAKER_73: actually. Yeah, I mean, it is not investment advice. But and I

SPEAKER_185: have a position always like that's followed by picking up the

SPEAKER_188: phone. No, no, I don't want to peer pressure you. The J trades are brought to you by these $3 readers on Amazon.

SPEAKER_123: For those of you who are not the video glasses on me. I mean,

SPEAKER_188: come on, man. Have you guys use Robin Hood? They're just

SPEAKER_191: trolling me. I think they reduced the funding flat reduced the font in Robin Hood this week just to troll me. User privacy is one

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SPEAKER_198: Lord, look at my J trading. I am glasses. I call the wrapping Nick

SPEAKER_199: point of privilege. Did I call the bottom? It's it's hard to say if

SPEAKER_201: that was the bottom, but it was a bottom. It was a bottom. Tell

SPEAKER_205: you what? It was a bottom. Yeah. I think the you being perhaps the only person in the public markets that actually made money off of

SPEAKER_208: stitch fix is probably a good signal. Yes. I'm an idiot. We

SPEAKER_209: should pull up my J trade is just a point of privilege here. Look at

SPEAKER_27: this stitch fix 5000 shares. I'm up 800 bucks. My Disney 250 shares I'm up 1300 my Amazon thousand shares I'm up eight grand. And my

SPEAKER_182: Warner Brothers I'm already up 1500. I bought that yesterday. So yeah, I made like, what is this 1015? Yeah, okay, great. Well, I'm

SPEAKER_27: going out. Let's just by next week, I'll be able to pay for my

SPEAKER_30: private jet to Mexico. I'll add you to the dinner reservation. I

SPEAKER_27: mean, I want to be intellectually honest about what I'm doing with J trading. To be clear, what I'm doing with J trading is I want to become a world class public market investor. Because that will give

SPEAKER_46: me the ability to understand private markets even better. The full lifecycle of a company. Number two, I want to make returns. I think there's a unique opportunity to make returns. So one I want to learn to I want to make returns three, I think it's going to be

SPEAKER_27: entertaining for the audience and educational for the audience. So there's like a trifecta here. Mm hmm. Also, it's a way for me to get some of these CEOs of these companies on the program. Mm hmm. I'm

SPEAKER_219: being totally honest. 40 chess. That was the four. Well, I mean, if

David Friedberg: I want to have like, if I'm buying, or not buying snap, maybe

SPEAKER_223: Evan Spiegel will finally come on the program. Right? I think this is I mean, why do people go on Jim Cramer? Mad money? Yeah. Well,

SPEAKER_45: he's he affects the stock price, right? I think I'm gonna impact stock prices because I think people are not because of who I am Molly. But because of our the thoroughness of the J trades, the intellectual honesty of the J trades.

SPEAKER_225: Interesting.

SPEAKER_114: Okay, I mean, let's go if we do a really thorough job and we pick

SPEAKER_45: winners. But I want if out of 10, I want at a minimum seven of them to be great trades in that they're up. I want seven out of

SPEAKER_114: 10 to be great trades. And when they're dogs, and they're not working, I'm going to unwind those trades. That seems to go

SPEAKER_24: against the whole point of the 10 year outlook, though, because you're gonna have natural dogs just based on market fluctuations

SPEAKER_205: from great companies. But you still think this is a great company. But if you bought it six months ago, you'd be like pulling your hair out right now under that view.

SPEAKER_02: Right. And this is where this is not investment advice. But I want to be able

SPEAKER_114: to make mistakes and unwind trades based on new information.

Jason Calacanis: All right, so Bitcoin enthusiast, Michael Saylor, I like how

SPEAKER_229: Understatement of the year. The enthusiast is like The enthusiast is like Halt leader.

SPEAKER_15: That's like, I'm an enthusiast about breathing. Yeah. Oxygen enthusiast.

Jason Calacanis: Big oxygen enthusiast, Michael Saylor is anyway, Michael Saylor is stepping down as MicroStrategy CEO to become executive chairman. Now for context, Michael Saylor has been the CEO of MicroStrategy for 33 years. He started the company in 1989, took it public in 1998. He will now assume this role of executive chairman and remain the chairman of the board. There is an ongoing question about whether this is in fact related to Bitcoin, because MicroStrategy, of course, went from being like a, what is it a chip company? I don't even know

SPEAKER_232: Business intelligence company.

Jason Calacanis: So went from being a business intelligence company to basically a massive Hoover of Bitcoin. And at this exact moment, I think is down something like $900 million on Bitcoin. So the stock market, as you might imagine, is reacting pretty well to Michael Saylor stepping down as CEO stock is up about 13 and a half percent. And MicroStrategy just released earnings, which were like, fine, for the software side of things. Revenue was 120, 122.1 million dollars down 2.6% year over year gross profit was 97 million because it is in fact, still a very high margin software business. Their actual business, their actual business, the regular one, as opposed to

SPEAKER_27: their treasury business, which is holding Bitcoin, which he frames Molly, as a treasury business. But in reality, what he did with this was he took his, you know, meandering

SPEAKER_91: software company, obviously has been around for a long time, and it's not broken out to some crazy amount of revenue. It's still more money than any of my companies ever made. So congratulations. But it's, you know, it's barely a public company,

SPEAKER_09: let's be honest, he then bought, got all these loans, bought tons of Bitcoin, and

SPEAKER_223: essentially created an ETF, a shell company, a Bitcoin, which I don't know how that's exactly legal. Because I thought like, they weren't doing Bitcoin ETFs, or

SPEAKER_34: crypto ETFs. But he he's framed, he's created an ETF so that you can invest in the

SPEAKER_241: micro strategy, Bitcoin holdings? Well, no, by taking micro strategies, a shell

SPEAKER_102: company, essentially, I see. So if you invest in micro strategy, you're effectively investing in a Bitcoin ETF. That's all you're doing. Nobody's

SPEAKER_09: investing in micro strategy for the micro strategy business intelligence

SPEAKER_244: business. $97 million in gross profit in q2. Okay, whatever. I mean, it's fine. I

SPEAKER_245: mean, yes, it's no good you are in at this point. Shout out to all the people at micro strategy staying focused on the actual business. Shout out. No, but look, the stock was flatlined. Look, this is a

SPEAKER_45: dead. Look at that. This is the ambulance is driving. And they're like, you know what, we don't this we're gonna we're gonna call it in the ambulance. Like, we can take our time we could stop and get coffee. On the way to the emergency room, this patient is dead. It was flatline. Yeah. And then somewhere around 2020, he starts buying a Bitcoin and 2021. This thing spikes up to $1,000 a share. Mm hmm. Because people were buying it based on the price of Bitcoin. So if you were to take this chart that we're looking at of micro strategies stock price of stock price. Yeah. And

SPEAKER_27: if we did the market cap would probably be even more illustrative of this. I'm

SPEAKER_137: sure the market cap parallels their Bitcoin holdings value. Yep. Because that's basically what you're buying is a bunch of Bitcoin and they own a lot of

Jason Calacanis: Bitcoin. Right. And so when we say a bunch of Bitcoin, here's what we mean. Just as a reminder, as of June 30, the company owned $2 billion in Bitcoin. That is 129,600 Bitcoins at an average price of $15,000. Wow, it's really down. The digital asset impairment charges reported in the q2 earnings basically how much they lost from Bitcoin $918 million for the quarter. So lost almost a billion dollars.

SPEAKER_02: So yeah, listen, the they were they were buying, I think 40 $50,000 Bitcoins. So

SPEAKER_09: obviously, when it went down to 17, there was all this talk about them getting liquidated. And I think the total number of Bitcoins will

SPEAKER_261: eventually be 21 million, right? That's all there are. That's all there

SPEAKER_02: will ever be. Correct. Now, there is a theory that a third of these are lost. So if it's really, let's say 15 million, and he owns 129, he owns 1% of

SPEAKER_45: the active Bitcoins. No, you know, we don't know the number of dead Bitcoins. I think some people have tracked that because the original wallets own so much and there is a theory, Molly, that Satoshi or the group of people were Satoshi, the reason that those wallets never sold their coins is not because they don't want their coins, the coins never moved out of those wallets, it's because they lost them. Mm hmm. So there might be this incredible embarrassment by the person who created Bitcoin, or they're just incredibly savvy that they don't want to uncloak themselves, even though they have, I don't know how many billions of dollars, you know, like the what percentage of the original wallets own is like this big question. And then why have they never moved? My theory is, they've never moved because people were just screwing around with the software. And they never wrote down the passwords. Because like, well, this is just a project. And then all of a sudden, they're sitting there going, Oh, my God, imagine if I came public, and I had $30 billion or

SPEAKER_182: $40 billion in Bitcoin, and I can never get to it. Oh, yeah, or

SPEAKER_168: they passed away or right. Oh, yeah, that's the other theory is

Jason Calacanis: that they could have died. Yeah, maybe they're like, ask anyone in LA. It's one guy, and he's dead. Which extra jobs like DM us

SPEAKER_90: later. I like the I like the dead. I like the dead or government conspiracy. Like it's a government agency. That's part of

Jason Calacanis: I mean, that's just more fun of that one. What's interesting is that sailor again is remaining executive chairman, this does not appear to be what you might think at first blush, right? Micro strategies loses a billion dollars. This guy steps away as CEO becomes executive chairman. Clearly, they're going to go in a different direction, right? However, the new CEO fang le said, I would like to reinforce our commitment to our customers, shareholders, partners and employees. And I look forward to leading to the organization for the long term health and growth of our enterprise software and Bitcoin acquisition strategies. And as executive chairman, Michael Saylor appears to actually just be freed from the pesky work of building any of the enterprise software. Because he said on Twitter, in my next job, I intend to focus more on Bitcoin, we have to have Michael on the

SPEAKER_27: program, he slid into my DMS. Yeah. So we'll have them on. Are

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SPEAKER_09: going to sell off the SaaS business, and then make this a Bitcoin holding company of some type, or they he's going to move up to exact chair because he the person who is this new CEO, my understanding is he was president CFO, and they got a new CFO. So Michael was explaining on CNBC this morning, I have to catch it, uh, that now that this they have a CFO in the president CFO can move up to CEO, president, whatever. So putting all that together. What I

SPEAKER_27: feel like is going on here is they are going to go on some sort of splitting this up, or going into an M&A structure. So how would

SPEAKER_45: that work? Pretty simple. If they can make this an ETF, essentially, or some sort of Bitcoin holding company, where they buy crypto Bitcoin assets, like, let's say, there were tools or whatever in the Bitcoin space, he could go start buying those. And then he could take this business and then sell it off and let it stand on its own and have its management team, etc. So there's something corporate going on here. Usually there's like, this is the first card. The first card was getting a CFO. The second card was him moving up, there's going to be a third, fourth, fifth, sixth, seventh card, you know, maybe seven cards here. And I think we know two of them right now. So more cards to come, and we'll keep an eye on it. But yeah, he might wind up being like, one of the smartest people in all of this crypto space, because Bitcoin is in enduring. And, you know, we sat here going, Oh, it's gonna go down to 5000. And I was like, Yeah, I don't know about that. But here we are, it's going back up again. In the face of this crypto collapse, Molly, if you're watching, but it was up to

SPEAKER_277: like, almost 23,000. The other day, my baby coin voice based

SPEAKER_29: portfolio is up to like $600. Oh, wow. After a low of 400.

SPEAKER_07: So here you go, you're you may trade, I may trade, I may

Jason Calacanis: trade, I may trades are killing it. Yeah. Speaking of trading, let's quickly talk about Airbnb estimates, if we may be our earnings rather, because we had an interesting conversation yesterday about Airbnb and its durability and its revenue moat, like what are the dials that it can turn. So Airbnb slightly missed on estimates for revenue. And then shares were down as much as 9% in after hours trading on Tuesday, despite huge profits, the stock has recovered now to only being down one and a half percent on Wednesday, to a $72 billion market cap gross bookings, as you might imagine, we're up about $17 billion up 27% year over year, because people are actually going places again. That's phenomenal. Revenue, though, did slightly miss it was I mean, I hate to say it slightly missed because it was up 58%. Yeah, $1.1 billion. Like why do we even the miss thing is just

SPEAKER_100: I don't care about these estimates. Like I just care, like I can

SPEAKER_02: make my own decision. Who cares about the analyst estimates? It was up 58% year over year percent. Yum yum. I understand it's the it

SPEAKER_45: does people base their trades on what the analysts are expecting. But I don't understand this tradition. I like to make my own

Jason Calacanis: decision, I think stopped. Anyway, what is it? So a couple interesting notes, right? Like, when we look at what is working for Airbnb, one of the things that they noted was that so nights and experiences booked 103.7 million long term stays, increased 25% year over year and 90% from q2 2019. So interesting trend. And I

SPEAKER_102: don't know how long it will last, right? Is that this remote work?

SPEAKER_274: I want to know how much experiences is versus nights. I wish to break

SPEAKER_27: those numbers out. I don't think they do. That'd be really cool to know that business. It's kind of like member Apple wouldn't share the services business until it got to be significant. And then

SPEAKER_11: they started sharing it. They're like, Oh, no, we're services business we have we're not just hardware. But yeah, those long term

SPEAKER_300: sales are juicy. They are I will that persist as a trend. I wonder

SPEAKER_165: you know, nomadic is going to persist for sure. Yeah. Yeah. I mean,

SPEAKER_09: other people have to go back to work. But not tech workers. Everybody else is going back to work. The tech workers seem to still have the upper hand. Now with all these layoffs and riffs. That's what I wonder, I wonder how long people are going to be able to? Yeah. Yeah.

Jason Calacanis: Other interesting things to note, Airbnb is also preparing for a $2 billion share buyback to offset dilution from employee stock bonuses via Bloomberg and then said, we are so they said, quote, we're so confident in our long term growth and profitability that today we are announcing a $2 billion share repurchase program.

SPEAKER_305: Oh, really? Yeah. Yeah. Wow. So they believe they're

SPEAKER_27: someone was like, J train? Hmm. Well, there's two ways to this is my understanding. I'd like to get an education on this. You really have to dig into these buybacks. Because some people might be

SPEAKER_45: interested in your position on this Molly. Some people say people do buybacks when they feel their shares are underpriced. And it's like, they would they think by buying them and reducing the total number of

SPEAKER_11: shares. That's good for the company or for the shareholders of the company, which includes management and the public shareholders and employees and everybody. They can't find a better use for it. In other words, building more products, spending on marketing, not as good as buying your own share and reducing the share pool, which

SPEAKER_09: men should be right with the price of other people say it's manipulation. And you're just trying to make the stock price go up by getting rid of them. Now for somebody like Apple, who just keeps printing money. Yeah, doing share buybacks seems like a

SPEAKER_27: healthy thing to do. Because what else they can't figure out what else to do with the money? Because it's just so much money sloshing around. I don't know if that's where Airbnb is. Do they have that much money, especially around but here's a very interesting chart because we're talking about Uber versus

SPEAKER_45: Airbnb. Now, Airbnb is profitable and has free cash flow

SPEAKER_11: and they have had for a little bit. Now if you look at the this is from Y charts, thanks to the folks at Y charts, they're not a sponsor yet, but they should be I need a charting sponsor for j trading. PS ratio price to sales ratio. Yeah, the purple is

SPEAKER_223: Airbnb. They were trading at 36 times at the peak of this madness 36 times their sales, not their earnings model. This isn't

SPEAKER_41: a price earnings ratio, right? Then you know, you look at

SPEAKER_27: Uber, it was much less 2.7 times their sales, and maybe it got

SPEAKER_45: up to 10 or whatever. And this is the compression that happened in the market. But you'll see that the two companies have started to narrow why my theory on that would be because Uber now is taking free cash flow more seriously. They're going to try to get up to that Airbnb and because you know, an Uber has that faster growth. So we'll see what happens. But you know, there there are price mismatches in the market on this price to sales. And I think Airbnb is was a real darling. I think Coinbase was a real darling. And if you look at Coinbase price to sales and Robinson hood hoods, and like they were also extraordinary people were really pricing in a lot of growth, a lot of growth. And you know, there, they've seen movies like Google, and Facebook, and Amazon and when you and Apple and Microsoft before that, when you see those movies, and you think, well, one of these companies is going to be like those, or a couple of them will be like the next version of those trillion dollar companies. That's when people get excited. And maybe these things start getting a

SPEAKER_22: little out of whack. Or that's the my theory on why people are making those bets. We'd love to hear your feedback, Jason at calacanis.com for life.

SPEAKER_205: This is Robin Hood and Coinbase price to sales over time.

SPEAKER_09: Yeah, so you just see it's come way down. People were looking at those businesses as like they're never going to stop growing,

SPEAKER_27: right? Right. And they were up in the 20s. And then whoop, right back down regression to the mean five 2.6 for Coinbase and 5.4. Yeah. And then there was where they both got in sync, which is kind of interesting as well. And now people are giving Robin Hood a slight edge on Coinbase, which makes sense given Coinbase is legal issues. And, you know, stocks are more resilient market, let's say, then crypto makes total sense. Right. So it's I like these pairings to try to, I'd like to start doing these pairings on Disney, and my Warner Brothers Discovery, and

SPEAKER_11: Netflix, right, start to understand those, right. And this is what we're going to do here on the J trading segments. But congratulations to Airbnb on having a kick ass business, by the way. And Joe Gabby is retired now. He left. So congrats to Joe on an incredible run. He actually came up with the idea.

SPEAKER_12: Yeah. All right. And that's it. For the new segment. Next up is

SPEAKER_324: the blueprint.

Jason Calacanis: Oh, am I doing great. Yep. Jason's gonna cover part four. I cannot wait to listen to having a bias for action.

SPEAKER_133: Hey, everybody, it's time for part four of my 10 part mini

SPEAKER_45: series. We're calling the blueprint. What is the blueprint? Well, it's how to have a great career. That's all it is. It's just career advice for you. If you're listening to this podcast this week in startups, you are probably want to be an entrepreneur capital allocator, and you probably want to be successful in your career. So this is not just based on like what I learned in my career, my career has gone okay. I also have been recording this week in startups for 1500 episodes, I've done conferences, I was a journalist. And a lot of my friends are way more successful than me. In fact, my friends tend to be some of the most successful people on the planet. Therefore,

SPEAKER_27: I've watched firsthand how people become successful. And this part for today might wind up being the most important one you ever hear. In fact, this could be this could be the 10 minutes of your life that changes everything for you. Because there's a segment of people who need to hear this. Now in part one, we did branding yourself with a breakout skill, critically important part two, we did when to quit your job. Part three, I did building and leveraging a network of that one got a lot a lot of great feedback. But today, I'm going to talk to you about creating versus waiting, also known as having a bias for action. And really, we'll title this episode, the benefits of a bias for action. I think that's really what this is about. Now, you've probably heard this term I bias for action. This is having an emphasis on the need to take action. Now you can daydream about your life and having a better job. I did that when I was on the train going into Manhattan, thinking about my career. But the people who actually take action and create

SPEAKER_46: something in the world are the ones who generate massive wealth,

SPEAKER_27: change the world and become legendary, right? So let's get right into it. The framework I want to talk to you about was codified by Amazon wasn't origin. It didn't originate with Amazon. But Amazon is some of the most thoughtful individuals in terms of thinking about thinking. This is called cognitive or meta, right cognitive like cognition thinking. So there are cognitive frameworks, cognitive biases, the way people look at the world and the way they think really does matter. Now, I'm not talking about manifesting or some, you know, alternative nonsense like that. What I'm talking about is the principle of taking action. Now you've heard about Amazon 16 leadership principles. These are the things that they will reflect on when they're having a discussion or a debate, where they're trying to make a decision, customer obsession, ownership, invest and simplify, learn and be curious, hire and develop the best. You can read about these things. But you know, buried in there is a bias for action. And they describe it as speed matters in business. And sometimes people will not say a bias for action when they describe it. So to say product velocity, speed matters, you'll hear these terms amongst the entrepreneur and capital allocator class. Why do you keep hearing this? Well, because we see it every day, we see the companies that are frozen, and

SPEAKER_02: don't make decisions and don't take action, die. And the people who are stagnant, and don't make decisions, they die. And what you realize is people have inherently a bias to do nothing, they have a bias to freeze. There's many theories on why this is, you know, you see a predator, you don't make a

SPEAKER_27: decision or making no decision is better than making a decision.

SPEAKER_46: We'll get into that in a minute. But in business and in your career, you need to understand that speed matters and that many decisions and actions are actually reversible, and don't need

SPEAKER_02: extensive study. Now there are some like what college am I going to go to? Okay, this seems like Oh my god, this is the craziest decision. Or what career should I pick? The truth is, some people will spend so much time thinking about what career they'll never actually start a career, they'll never actually take a job. So they'll sit there making lattes, while they try different, you know, night courses, or they read books, but they never actually go take a job, it would be better to just go take the sales job. Go take the product management job, the PR job, whatever job it is, and just get a feel for what those are. And if you love them, keep

SPEAKER_45: going. And if not, you can reverse them. And you want to really create value by calculated risk taking the risks that you take, are the ones that create the value. So just keep that in

SPEAKER_27: your mind as we talk about this. So Amazon breaks down these three points to create buy in, right? So when they explain the why they give factual insights, speed matters in business, okay, great. Then they try to teach a lesson or educate you. Many actions are reversible, you don't need extensive study. And then finally, Amazon creates a value or principle, we value calculated risk taking. So that's how they will explain this to you. Right? Speed matters. Okay, I got it. Many decisions are reversible, you don't need to study it, you don't overthink it, great. Okay, that makes sense as well. And then they create a value inside their company. So when you're working on your company yourself, you should have some value system. And you might have heard Michael Jordan say, Hey, you miss 100% of shots you don't take or I miss more shots than anybody in the history of the NBA, yada, yada, that's calculated risk taking thinking. The BFA bias for action is related to other cognitive biases. The status quo bias is has existed for a long time. And it basically says, we knew ideas are not that much

SPEAKER_02: different than existing ones, people would feel safer to just very modestly increment what happened previously. I saw this firsthand. When newspapers were looking at the internet, you know what they did, they took the design of a newspaper, and they put it on websites, I kid you not. And so they would show you a front page and you would move your mouse around with a magnifying glass to read it. And then in a story, you would say continued on page 26, you click it, and it would make a motion and an animation of the newspaper flipping 26 pages. And you're like, Well, you could have just let people scroll to the end of the story, you don't need to use a jump. Right? That's this status quo bias. When people made the first cars, you know, with

SPEAKER_45: a an ice engine, they looked exactly like the ones with horses, they just got rid of the horses, and people were sitting on the hoods of the cars. And you're like, wait, this makes no sense. Again, this incrementalism, the status quo bias, people will stick to what they were, you know, they don't want to make a radical change. But the businesses that really break out, really do

SPEAKER_27: make radical changes. As opposed to this incrementalism, which equals a slow death, it's also the sunken cost fallacy. Now, if you have been doing something over and over again for a long time, like your startup, you know, is invested in this tech project, or this certain customer base, or you invested in the stock, or you're investing in private companies, and you keep doing bridge rounds, you will look at the money you've put into

SPEAKER_02: this and the time, the effort, and you won't want to make a

SPEAKER_27: change. Because you've got this sunken cost, whereas somebody else will come along and say, Well, I don't have a sunken cost, I'm just going to start a new company with this better idea. And often, these two when they're combined together, create this real lock in inside an organization, and inside a person who's trying to build a career. I'm a journalist, I

SPEAKER_46: can't be an investor. Well, I'm a journalist, I can't be an

SPEAKER_00: entrepreneur. When I looked at it, I was like, Well, I'm, I'm

SPEAKER_09: an IT person. Why can't I be a journalist, I know about this tech. And I'm a journalist now, why can't I be an investor or a company creator? I didn't actually have this sunken cost

SPEAKER_27: fallacy or the status quo bias. I was just thinking, I could do anything. Why not? Why not me was what I always asked myself, somebody has to figure this out? Why not me? And you have to break these cognitive biases that get cemented over time. There's also the confirmation bias. Okay, and the confirmation

SPEAKER_09: bias is that you seek out facts that confirm your existing belief. So you're like, Well, this is how newspapers have always worked. That's why they have to work this way on the web. This is how e commerce always worked. This is how transportation always worked. This is how trading stocks always work. Of course, you have to pay a fee. We can't have free trades. And then

SPEAKER_27: somebody will break the mold. And then they will go much further

SPEAKER_46: in their careers and their companies, their products will be more innovative. And you can always again, back to Amazon's point, you can always reverse bad decisions. There's very few

SPEAKER_02: decisions that have the risk of ruin. If your decision is, I want to climb mountains, like Alex Honnold without a rope, okay, that's a stupid decision. All due respect to Alex and his tremendous talent. It's still a stupid decision. Because we could be sitting here just as easily never even know the name Alex Honnold, because he could have died the first time he tried to climb a mountain without a rope because he's put his hand on some bird poop and slipped off. Like that's how bad that

SPEAKER_27: decision was because of the risk of ruin. Now, there's also a theory called norm theory. What norm theory states, and this was actually a paper by Daniel Kahneman in the 80s. And this is where a lot of this got started, is that making no decision sometimes is the optimal decision. And they did a study of

SPEAKER_02: goalies, it turned out a lot of goalies would be best served sitting in the middle of the goal, and not jumping either way until the ball got struck. But they would try to figure out which way the ball was going to go when the person was running to the ball to kick it, and they would jump a certain direction, they had this bias towards action. Now, why did they have that? Well, it turns out if you do nothing, sometimes that's an optimal theory. But other times you may not like living with the results of what your behavior was. So if you did nothing, and the ball went past you, everybody's gonna look at you and go, hey, schmuck, you did nothing, right? You just sat there and did nothing. So goalies just picked the direction, they kind of jumped out, they made their best guess at it. Statistically, that was a bias that people had to get over. But then there's other times where people do not take a chance. And this is where startups are different. They didn't take a product chance, they didn't take a chance to go after a new customer to change the name of their company to change their business model to go from business to business to consumer or consumer to business to business, they didn't make a change. Because they

SPEAKER_45: thought, Okay, if I make that change, and it's audacious, and I fail, can I live with everybody laughing at me, essentially? Can I live with the stigma of having made this change? And you know what? Yeah, you grow up in Brooklyn. And you say, Hey, I want to start my own magazine, you know, people left at me, I said, I want it to be a black belt, I wanted to run a marathon, I had people laughing at people, my own family laughing at me, like, you will get this from the people around you. And it can put into your brain, this risk taking a version, where you say, you don't want, if I take that risk, and I fail, and I'm gonna look really bad, it's better, I just stay in my lane, I'll do x, whatever the safe thing to do is. And so being just aware that norm theory exists, could change your entire way of going out in the world. And the way I would look at

SPEAKER_00: this is if you're an attorney, and you decided to be a venture capitalist, I've talked to attorneys who want to be venture capitalists, where if it doesn't work, do you think you're gonna still need startup lawyers in the world to be able to get

SPEAKER_09: another job? They're like, absolutely. Well, then why wouldn't you try? And they're like, I'm not sure if I'll, you know, they don't even actually know why they're not trying. But

SPEAKER_02: the real reason is, they're afraid they're gonna fail. And no gamble, no future. This bias for action comes from the Marine Corps. They develop a bias for action. And they define it as a combination of willingness to take initiative, act boldly and

SPEAKER_27: accept risk. This is long before Amazon, you know, made this part another operating philosophy. And the value of this cannot be overstated in wartime, the 20s. And I'm just going to read you a little bit about this, the 27th commandant of the Marine Corps

SPEAKER_46: General Robert H. Barrow spoke to a group of soon to be commissioned officers and emphasized individual audacity as

SPEAKER_27: the key to future success. He defined audacity as boldness of thought and action, which often contradicts established wisdom, we must cultivate the audacity to conceive bold strikes, and the guts to carry them out. The more opportunity that can be provided to develop a bias for action, and the less barriers to bold thoughts and action, the more success successful officers we will breed. Therefore developing our habit of thought is just as important as developing our

SPEAKER_02: technical proficiency. In other words, the Marines train people who are on the ground to make these decisions in real time and make audacious ones and have a bias for action because it wins wars. Full stop. And the people who get frozen like that goalie in that situation, not moving might be the better one. So I'm sure there are situations where the Marines sitting tight might be the right

SPEAKER_27: decision. But a bias towards action and making bold decisions is what typically wins wars, not sitting back and doing nothing. And that's why in startups, we look for that. That's why people like Reid Hoffman have said like, if you're not embarrassed by your first version, and you waited too long to release it, you really have to get the ball moving. And what a bias for action does is it also will bring more people to rally behind you. People want to see people with a bias towards action succeed in the world, they're attracted to it. It's not nothing attractive about somebody who just sits there and you know, does your 910 1112 1315 20 of this career where they're not growing. Nobody's really like, you know, throwing parties or writing stories about that person, they're writing

SPEAKER_11: stories, and they're backing more importantly, giving money to and going to work for people who take those bold actions, right. And they, the bold actions win the wars, whether it's in startups or in actual real life. And this is where the second framework comes in. This is where you can really apply it if you're at a startup is product velocity, we meet a lot of people

SPEAKER_02: with ideas, I meet too many people with ideas, the ideas mean zero, they do not change the world. And I a great idea can change the world if somebody executes on it, you need to actually build a great something. So you have to stop waiting. And you just have to build

SPEAKER_27: something. And if you're in a position to quit your current job and go build something, or you want to do it on your weekend, watch blueprint one and two if you aren't sure, but I talk about like,

SPEAKER_11: you know, sort of frameworks for when you should actually quit or how to quit or how to move on to your next idea while you still have your existing job if you need to make money. But really, one of the key metrics my team evaluates when we're looking at investing in something is how is the product change since we first met this

SPEAKER_27: entrepreneur? What's changed? And so you know, if you've got investors using a test flight app, if they see you sending an email with new features, and they see the app getting updated, and in the notes, you explain what's being updated, it becomes addicting to people, the change log becomes how people make their decision to invest. The people who investors invest in are people who are iterating on that same product over and over and over again, and getting in front of as many customers as possible and pushing that rock up the hill. Sure, you want to gather feedback, that's fine. But remember, there's another statement we say all the time done is better than perfect, or don't let perfection be the enemy of progress. The speed is much better than perfect. When it comes to the competition to build great companies. You want to build you want to talk to customers you want to iterate. Of course, if you make too many features, you can delete old ones, right? That's they can become a distraction, they can become what's called technical debt in our industry, you have to keep up with them. So don't be afraid to kill something that's not working. That is also a bias to action, a bias to action saying this isn't working, we're gonna stop it a bias to action, you know, hey, we're gonna go do

SPEAKER_11: this. That's basically a philosophy you want to have a body in motion stays in motion, as Newton said, startup in motion stays in motion, you need to build a culture of constantly

SPEAKER_27: building stuff and innovating. If you listen to this podcast,

SPEAKER_02: this week in startups, you see, I'm constantly trying new ideas like the blueprint, like VC Sunday School like J trading, I want to try different things, see what sticks what connects with an audience, all in podcasts was but one example of that, you

SPEAKER_27: know, the conferences we've started remote demo day, I'm constantly trying new ideas, some sticks, some don't we can deprecate others, and we can build others up and double down on them. I hope this has been helpful for you. And think about, you know, what risks are taken and what biases you have. And maybe what's keeping you from taking that big leap or that jump or going after a bold idea or canceling your last idea, shutting it down and moving on to the next big idea. A bias

SPEAKER_11: first action is absolutely essential, if you want to have an epic life and you want to do great things in the world. So I hope this has been helpful. If you have a friend who maybe is a little stagnant, you can send them this clip, maybe it helps them shake something loose, and go on and be the best version of themselves. Alright, thanks for tuning into the blueprint.