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SPEAKER_02: All right, everybody. My guy, Steve Case is back on the program. He's got a new book, Rise of the Rest.

David Friedberg: You know, he founded and he's the CEO of AOL, changed the name from Quantum Computer Services back in the day to America Online.

SPEAKER_06: And at the peak, 32 million paid subscribers, 30 bucks a month. Was that the peak, if I remember correctly, Steve?

SPEAKER_08: Something like that. I think it was 20 something bucks a month, but maybe, maybe we raised it on your account to 30. Yeah.

SPEAKER_10: But I mean, just think about that. We talk about subscription businesses like Netflix today. We talk about Spotify.

David Friedberg: This was unprecedented in the world for 30 million people. And the company was throwing off billions of dollars, quarter in revenue, but more importantly, just making a massive cultural impact in getting people online and introducing them to the modern web and the internet.

SPEAKER_13: Looking back on it, what do you think was the key to why AOL captured the market? You know, just as a founder, what were the two or three things you did so well?

SPEAKER_16: Well, a bunch of things.

SPEAKER_18: When we started in 1985, only 3% of people were online. And those 3% were online at average of one hour a week. So, it's pretty early days.

SPEAKER_19: And it took us a decade, really, to finally break through. Most people were kind of skeptical that average people would ever have an interest in getting on the internet. It seems crazy now, but that was the view then. And I think our focus, in terms of your question, was we wanted to make it really easy to use, really useful, really fun, and really affordable. And that was sort of the North Star that guided all our efforts around software design, subscription pricing, our marketing efforts. How do we make the internet available to everybody?

SPEAKER_21: But the first decade was a slog. It was a total slog.

SPEAKER_19: Total slog. It was there a few times we had to go through layoffs and really hard to raise money. Our first round of venture capital, we raised $1 million. It was, you know, hard to get people to believe in the idea of the internet. It's really hard to get people to believe in our team and that we'd actually have a shot. So, it was like many entrepreneurial journeys, a struggle and also a little bit more of a struggle because we were starting AOL in Northern Virginia, kind of outside of Washington, D.C. There was really no venture capital there at the time. Most people were reluctant to leave a big company, what seemed like a safe job to go to a little company. It seemed like a risky job, hard to get people to pay attention. And I think that helped inform some of my thinking and give me a little bit more, probably, empathy for the entrepreneurs all around the country.

SPEAKER_23: I think that, in part, led to the effort around Rise the Rest and trying to back entrepreneurs everywhere.

David Friedberg: Yeah, I mean, this actually is the perfect segue because you, you live this, you, you were not in Silicon Valley where money flowed much freer. And, man, at that time, it was just a different world, um, in terms of the ability to, to raise capital or convince people to come to a startup. Today, kind of a lot of young people are like, well, that's my default. I want to go to a startup. I want to, I want to start a company.

SPEAKER_27: You started a fund, I guess, after the big AOL Time Warner merger, you've talked about that for a decade, it's gotta be a little annoying to recap that every time you get an interview.

SPEAKER_28: Uh, so we would do that here, uh, and we've been over it before, but that was the biggest M and a, uh, actually is the Twitter purchase a bigger, no, it was 50, right?

SPEAKER_19: Yeah, no, it was 350, 350, I think it's still the largest merger in history. Yeah, and yeah, just briefly, I don't like to really dwell on it, but I think that it's a reminder to, I think entrepreneurs out there that, you know, kind of, there's a Thomas Edison quote I love, vision without execution is hallucination. Yes. The idea of those coming together, leading internet company at the time, we had half all the internet traffic in the United States, Time Warner was the leading cable company with broadband, had all these brands like HBO and CNN and Warner Brothers and Warner Music and Time Magazine and so forth. You know, it, it should have been the perfect company to lead into the, in the future of this digital convergence that was starting to happen, but just couldn't get the right people focused on the right priorities. So ultimately it came down to execution, which is, you know, is at the core, what, what separates the winners and losers in the world of innovation and entrepreneurship. So in retrospect, there was a big, big disappointment, but I did, I think, learn some things that hopefully I've been able to apply to some of, some of the things since.

David Friedberg: I mean, if you look at it, the modern day Disney corporation and what Amazon is doing with Amazon prime, what Google is doing with YouTube, that playbook was eventually figured out. I think the problem was you, you had this incredibly innovative team at AOL who moved quickly, and then you had a media business that just wasn't ready to move quick. They were two different paces. You had people jogging and then you had sprinters and sprinters cannot, you know, hang with a bunch of people who are just jogging around a track at a leisurely pace.

SPEAKER_10: How much of it was fair?

SPEAKER_16: I think that's fair. And some, yeah, so it was a different teams, different, you know, different cultures.

SPEAKER_19: I remember being in a board meeting right after we emerged, so it would have been over 20 years ago and realizing that some people in the room were speaking one language, other people were speaking in other language. There is this dynamic that you just described between the attackers and the defenders and entrepreneurs tend to be more in that attacker what's possible mode and defenders more in the protect what's there, kind of defend the turf mode. So there are a lot of factors there and certainly some of the timing and retrospective was not helpful because the merger happened just was the whole.com kind of crash happened.

SPEAKER_18: So a bunch bunch of different different factors, but live and learn and keep moving forward.

SPEAKER_41: Yeah, I mean, one of the interesting things there, and then let's get on to the book and your experience investing in the middle of the country and everywhere outside of the major cities.

SPEAKER_10: If you think about these subscription businesses and AOL subscription, ostensibly people were paying the subscription to hear the modem squeal and connect.

David Friedberg: But if you were to ask them why they were doing that, it was to get content and community on the other side. And that really has become why people subscribe to, you know, all these other services. So they just sometimes being early is an asset, I guess, and sometimes being early makes it impossible. And that's part of the art of being an entrepreneur. Yeah. Yeah, absolutely.

SPEAKER_19: There is an arc to these things and you have to keep kind of leaning in the future. And we did that well for a while, but then kind of lost our way. And that created the opening for others to fill that vacuum.

SPEAKER_48: And that is sort of the entrepreneurial story. All right.

SPEAKER_47: Listen, the book's great.

David Friedberg: Uh, and the book is based on you starting the rise of the rest venture capital firm, getting a bus and then deciding, uh, you would look at all the entrepreneurial communities or places with entrepreneurial activity. I think that didn't have entrepreneurial communities might be the better way to say it and just go visit them. And you came up with a playbook. Hey, we'll go to this place. We'll have a nice breakfast at an iconic location. And we'll invite the CEOs. We'll invite.

SPEAKER_13: If there's any investors and we'll do a little tour of all the, uh, startups there and just see what happens. And you've been doing this now, I think for close to a decade, huh?

SPEAKER_49: Yeah.

SPEAKER_13: When you go to the, when you, when you did this tour and then the book outlines a lot of these visits and what it takes to build a community outside of Silicon Valley, which was, you know, 80, 90%. And if you put Boston and New York together, that was 90% of venture capital, you did this pre and post pandemic. And I think that's really what makes the book fascinating is that you were grinding and grinding, trying to make this point. And then the pandemic happened. So maybe talk to, uh, the audience here about what you learned pre pandemic. And then what the pandemic did to this concept of other cities, having venture capital and tech hubs and excellence.

SPEAKER_19: No, it was definitely the pandemic has been a tipping point. So it's been tragic and a lot of respect, but if you're looking for a silver lining, I think the idea of the rise of the rest is really accelerated because of some of the dynamics, including some dispersion of talent. And some people decided to move someplace else and some dispersion of capital as coastal investors started using zoom to invest in other places. That's been helpful. A little bit of backstory bridging to what we're talking about with the old time Warner merger. When I proposed that, that deal, I, as part of that agreed to step aside as CEO. So when the companies came together, I was, I no longer ran, uh, or any of the other businesses and stayed on as chairman for a couple of years and then decided it was time to move on and started revolution as an investment firm that initially was just investing my capital. And we backed a number of companies, including one of the early, you know, kind of, uh, sharing economy companies, zip car and exclusive resorts, a bunch of companies.

SPEAKER_53: Exclusive resorts was kind of like Airbnb, right?

SPEAKER_19: Yeah. Yeah. Yeah. Bought into a portfolio of homes and, and we still have that business is doing is doing quite well. And then about a little over 10 years ago, decided to do two things. One was to institutionalize revolution. So we did start accessing outside capital, uh, as well have a couple of billion dollars of other, uh, institutional capital. And we have the revolution growth fund that's invested in companies like, uh, DraftKings and clear. And sweet green and big commerce and many others. They also have a revolution ventures fund and that's some policy genius and bright sellers and a number of other companies. And then more recently, to the core of your question, we launched the rise, the rest seed fund, which is explicitly focused on place. And so it really is investing outside of, you know, the San Francisco area, outside of New York city, outside of Boston, which as you said, is where, you know, there's not much venture capital. We said, let's go find some of the great entrepreneur building, some of the companies of the future in places that don't really get a lot of attention, don't get a lot of venture capital. And we, we launched that in partnership with, you know, several dozen prominent entrepreneurs, people like Jeff Bezos and Howard Schultz and venture investors like Jim Breyer and John Doerr and hedge fund people like Ray Dalio, private equity people like Henry Kravis, you know, Sarah Blakely in Atlanta. A bunch of, a bunch of people that really all helped join with us to, to back these entrepreneurs. And so far over the last five, six years, we've made 200 investments in a hundred different cities. And it's remarkable what's happening in all these cities, which ultimately why I decided to write the book after spending a better part of the decade traveling the country, sometimes on bus, sometimes for other reasons. It's remarkable what's, what's building in these cities, but most of the attention and most of the capital still goes to places like, you know, Silicon Valley or a few others.

SPEAKER_48: And we think over the next decade, there'll be a few dozen cities that really surprise people in terms of what's happening with startups.

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David Friedberg: Work from home goes from being for weird people and face it strange companies, peculiar companies, but you know, odd founders who say like, I'm going to let people work from home. And maybe it's 10% or less than the tech market. And then it becomes the dominant modality. And now hybrid seems to be, you know, I don't know, maybe half of the modality, or maybe it'll be a third.

SPEAKER_41: I'm not sure where you think this will wind up.

David Friedberg: But of course, venture capital is then since we couldn't meet with people where we started placing bets over zoom. And what we found was if everybody gets a beautiful setup, like you have there, we went from people using, I don't know, Skype and things that didn't work to all of a sudden zoom and other pieces of software working perfectly.

SPEAKER_13: Perfect cameras, perfect audio. And the society figured out a way to make it work. People are happier. You recapture two hours of commuting, three hours of commuting a day. It turns out people are happier and more productive. Do you believe because let's face it, you're old school, man, you, you, you built these companies in person and, you know, and, and the whole culture in the 90s was, hey, get your ass in the office. And we judge companies by how many cars were in the parking lot after six o'clock. Do you buy into this work from home stuff? Do you think great companies can actually be built work from home? Or do you think you need to have hybrid at a minimum? Or do you think the winning companies will be where people go to an office? What do you, what do you, what do you personally?

SPEAKER_19: All above. We already seen that with, even with our portfolio. So there's some that are remote only companies that were designed from the get go to be fully remote. And everything they've designed in terms of the infrastructure and communication technologies, and well as doing some physical, you know, get togethers, off sites, things like that are designed around that. There are definitely some companies that are fully back in the office that actually tends to happen more in some of these, you know, rising cities. I think it was in Fayetteville, Arkansas last week, one of the companies we backed their acre trader has 150 employees and they're basically in the office all the time. But as you say, most companies are somewhere in the middle, some version of hybrid and they're still debating exactly how to make that work. Three days in, two days out, you know, which days do people come in, which time when, when, when make sure teams are in on the same days, things like that. I think the main point is that it does provide a level of flexibility that did not exist three years ago, both in terms of entrepreneurs where they want to start and scale companies, investors where they want to invest in companies, certainly employees where they want to live and how they want to work. And I think it's going to take a few years to kind of settle it out. It's sort of like a shake the snow globe moment for society and exactly how it plays out. I don't think anybody has a really good crystal ball, but I think it has been on lock and, and obviously, you know, well that Silicon Valley is still the leader of the pack and will continue to be the leader of the pack. There are a lot of advantages to be there for sure. But I do think we kind of hit peak Silicon Valley, maybe three years ago, and now we're seeing the dispersion of talent, dispersion of capital, and that's going to be good for these other cities. And frankly, also good for the country because one of the things I didn't fully understand till about a decade ago when I started working with the White House and some other groups on policy related to innovation entrepreneurship was how critical new companies are in terms of job creation. It's not small business or big business that creates that new jobs. It's new businesses, startups under five years. Yeah. And so we need to back more startups in more places. Most of those startups, not all, but most of them do want and need venture capital to really be successful.

SPEAKER_18: So we've got to get more venture capital, more entrepreneurs in more of these places if we're going to create jobs and opportunity in more of these places and give more people in the country reasons to be hopeful and optimistic about the future as opposed to anxious, fearful, pessimistic about the future.

SPEAKER_19: So at the core, we're investors trying to generate, you know, top returns by by backing great entrepreneurs. But there's also some broader kind of ripple effects this could have in different cities and more broadly and possibly even helping, at least in a small way, uniting a divided country.

SPEAKER_27: Yeah, I mean, if we can rally around the fact that America still remains the place where entrepreneurs want to be and create great companies, that's some common ground.

David Friedberg: I don't I don't know anybody who I mean, I guess we have some fringe anti capitalist people in the country. And we can talk about why that is, maybe they feel a little bit left behind and rise of the rest is helping maybe people not feel left behind. Um, actually, that is a good question.

SPEAKER_10: Did you find people were anti capitalist or felt capitalism was broken in some way when you went around the country? Or did you find largely people still believe in capitalism? They still believe in elbow grease.

SPEAKER_13: They still believe in innovation. They just feel like maybe they're not part of it. What was the what was the vibe?

SPEAKER_19: Certainly a mix, but say generally, you know, people all around the country do applaud the innovators, the pioneers who build things and change things. And and so entrepreneurship is still celebrated. There are some who get anxious around what is sort of an opportunity gap where because most of the startups have been on the coast. A lot of people have left different parts of the middle of country feeling like they can't stay there. There's not much opportunity there. They have to be someplace else like like Silicon Valley. So there's been a little bit of a hollowing out of some of these communities and that makes people nervous. And some of the disruptions, obviously, some of the new technologies do end up destroying jobs in some of these communities. And this is not a new idea. The automation of factories, for example, using robotic technology has been developing for a few decades. And I remind people that a century ago, 90 percent of us worked on farms and now it's less than 2 percent. And the reason it's now 2 percent is because technology basically allowed you to grow more food at lower cost with fewer people, which actually is a good thing if you're trying to feed the world. But a bad thing in terms of, you know, unemployment. Thankfully, as a nation, we pivoted and move people from farms to factories and went from the agricultural revolution to the industrial revolution. More recently, we have not made the same kind of smooth transition as we've entered the digital kind of revolution. And that's why people feel left behind. So there's a balancing act that at one level, people celebrate the innovators. Another level, they're a little nervous that they're not getting any of the benefits of that innovation. And I do think if more companies start in these cities and scale in these cities, you know, you'll see a dynamic change. I'll just give you a few examples. I mentioned this company, AcreTrader in Fayetteville. It's basically a platform to invest in farmland. And the founder was from Arkansas, but then moved to San Francisco, actually was working for a hedge fund in San Francisco when he came up with the idea of AcreTrader, but thought he would be more successful if he was in Arkansas, because the first step there was getting farmers to believe in him and trust him and put their property on his platform at scale quite nicely.

SPEAKER_72: And that's one example. Another example in Chattanooga, Tennessee.

David Friedberg: That's a great one, by the way, because Bill Gates is buying a farmland and it seems to be like an amazing investment opportunity. Is that one only open to accredited and qualified purchasers?

SPEAKER_27: Or is it have they figured out a way to let civilians get in there and invest in farm?

SPEAKER_19: They're working on trying to democratize access to that as a class of investment. As you mentioned, some people are able to and do invest in farmland. It's a good way to diversify your portfolio. Most people don't have a path to do that. And that's what they're they're they're focused on. In Chattanooga, there's a company we've backed called Freight Waves. That's basically developed kind of like a Bloomberg data platform for the trucking and logistics industry. And I didn't know this till we were there with our rise arrest bus, but most of the big trucking companies in the country are headquartered in Chattanooga. So it's actually a better place to start that company. Who knew? And you're seeing more of those examples and in the process creating jobs in places that felt, you know, left behind. Another great example I talk about in the book is what's happened in Detroit. First of all, it's worth remembering that 100 years ago, Detroit, in essence, was Silicon Valley of its time when the car was the sort of the technology of the day. And people wanted to be part of that car revolution. People wanted to move to Detroit. But then Detroit lost 60% of its population over the last half century. And the year before we rolled in on our bus about eight years ago, the city of Detroit went bankrupt. So it shows you the rise and the fall. But now it's the renaissance there is amazing. We backed a number of companies there, including Shinola, which makes watches, StockX, which is a stock exchange for things with authentication. Neither of those companies existed 10 years ago. Both now have well over a thousand employees in Detroit, and that's leading to the rebirth of Detroit.

SPEAKER_18: So this is just the reason I had to write this book is these are great stories, not just about companies and entrepreneurial ideas, but on what's happening in cities.

SPEAKER_19: And most people have no clue that this is happening and or just think it's happening in a few cities, not a few dozen cities.

SPEAKER_13: And one of the things you learned in your career was if a company is successful, you then get the alumni. And if you look at AOL, uh, Chamath, Polyhapitiya and I, and you made a nice mention of all in. You're a pal. We, you know, when, where we met was, uh, Ted, uh, Leonsis, uh, my great brother and your partner, uh, had bought my company, WebLux Inc.

David Friedberg: Thank you. My first big entrepreneurial win. And, uh, I guess Dave Samuel, venture capitalist freestyle, you had bought WinApp and WinApp's first product manager was this Chamath Polyhapitiya, some poker player in, uh, you know, down in, uh, what's the place in Jersey where people play poker?

SPEAKER_41: I forgot boardwalk. Anyway.

SPEAKER_83: Atlantic city.

SPEAKER_51: Atlantic city. Yeah.

SPEAKER_13: And I met Chamath going through a revolving door quite literally at some event that Ted Leonsis, the March to a billion. And Ted had this crazy, you know, uh, offsite for all of us as VPs, EVPs, and Jim Bankoff is there. Right. And Dave Samuels is there. I mean, all of these alumni, have you started to see that happen yet when you see a stock X do well or, uh, any of these cities yet?

SPEAKER_77: Or is it a little early for the alumni to go out and Hey, they made a million dollars in options and start another company.

SPEAKER_88: It is happening. Interesting.

SPEAKER_19: You mentioned Chamath because the office I'm in in downtown Washington, DC, you know, a couple of offices over like 20, 25 feet. I, you know, Chamath came to visit, uh, before he was moving from DC to San Francisco to join. Yeah. I think it was Menlo Ventures at the time before it went to Facebook. Mayfield or Menlo? It was one of those, yeah. Maybe it was Mayfield. One of them. He was only there a couple of years before he joined, uh, Facebook. And, and you're right. What happens is, you know, I write about in the book is call it, you know, sort of this idea of tentpole companies that their success triggers sort of an increasing returns network effect, you know, dynamic. We saw that with AOL in this area, which is why even though it wasn't very tech friendly, very startup friendly when we started AOL here three decades ago, it's where Amazon chose to have its second headquarters. That would have been inconceivable when we were getting, you know, started. You've seen the benefit of that in Austin with Dell. You've seen the benefit of that in Seattle with Microsoft more recently. You've seen the benefit of that with in place like Indianapolis success of exact target that was acquired by Salesforce had lifted that or a dual security acquired by Cisco and Ann Arbor. So these tentpole companies show people in the community. It's possible to build these significant, valuable companies, educate people about how to scale these companies and then do create, as you say, sort of alumni people that want to go off and either start new companies or have some capital because of stock options and want to be investors in new companies. And that's a core part of what makes the Silicon Valley ecosystem so so vibrant.

SPEAKER_90: And now we're starting to see that spread all across the country as this rise, the rest accelerates.

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David Friedberg: The crazy thing about this is for the last decade, everybody's been telling me that a dictator in China is going to steal capitalism. He's going to perfect it and America is going to get wiped out. And I say, you know what? I don't know how a strong man can take this operating system of capitalism, allow a bunch of people to become famous, have a bunch of Steve cases, Jeff Bezos, Elon Musk's, whatever the case may be, and then, uh, be okay with it. Sure enough, China just lopped off the heads of every tech company and capped how much money they can make and who can be in charge of them. When you look at this resiliency in America and, and the fact that people haven't been able to dethrone us. What does that tell you? Because we, the last two decades, everybody's telling us how bad America is, how we're going to lose. And we just keep winning. Why does America keep winning? Why didn't China? Why wasn't China able to keep it together when they stole, stole, basically, and cribbed our entrepreneur playbook?

SPEAKER_16: Well, I'd say, first of all, we do have to be careful going back to our earlier discussion that as a country, we don't get cocky or complacent.

SPEAKER_19: We have seen the globalization of entrepreneurship. You know, 25, 30 years ago, 90% of venture capital in the world was invested in the United States. Now it's well under 50%. And some countries like China, which most people 20, 30 years ago thought would be good at replicating stuff, but not good at inventing stuff has gotten quite good at inventing stuff. And it's, it's quite strong in, in some of the core technologies, AI, robotics, other kinds of things. So it is a wake up call, but I agree with your basic thesis. There's something unique about the American spirit, the American story. It's much more of a bottoms up approach to innovation as opposed to the China, you know, kind of more top down government controlled approach to the innovation. And, you know, we do have an opportunity to continue to lead the way, continue to be the most entrepreneurial nation in the world. But I do think it requires us recognizing that, you know, game on in terms of global competition. Also, you know, requiring us to ties in with rise to rest and have a more inclusive innovation economy that just doesn't benefit a few people or a few places, but it's much more widespread all across the, you know, the country. And that also maximizes the sense of shots on goal is, you know, if you want to, you know, win games, you know, more shots, you know, tends to lead to more goals and more, more wins. So how do you get more shots on goal as a nation backing more entrepreneurs? And that's where backing more entrepreneurs in the dozens of cities in the middle of the country, not just a few cities on the coast, I think is so important to, you know, unite America. But also, I think, critically important if we are going to continue to lead in what is much more intensified global competition around technology, innovation, entrepreneurship. All right, you're, you know, on the margins involved politically.

SPEAKER_27: Sometimes Obama asks you to help with something. You'll get on a plane and you, you, you help out. I understand. Uh, you talk about.

SPEAKER_102: I actually have to get on a plane because my office is six blocks from the white house. So I, I, I, it's a little easier for me to help. But yeah, you know, people want to keep pulling you in.

SPEAKER_10: I'll put that aside for now, but I want to talk about immigration and I want to talk about the polarization of this country. We're sitting here, everybody's debating immigration constantly fighting with each other.

SPEAKER_70: You want no borders. How can you have a country without borders? Oh, you are a xenophobe. You don't want anybody in the country. Your parents were immigrants. How dare you? And the truth is, you know, immigration is many things. We've seen recruiting great entrepreneurs, uh, from other countries results in great things, more shots on goal.

SPEAKER_10: We need people to, uh, work in jobs that maybe Americans are not interested in taking.

SPEAKER_13: Yeah, of course we don't want to flood the zone with so many people here that we have homeless people or issues around not enough jobs. If you were, uh, in charge of immigration, if you were in charge of what I call recruitment, which is, I think, distinctly different than immigration. What would you do?

David Friedberg: Would you take a point system like Canada, Japan, or not Canada and New Zealand, Australia have the point-based systems. Uh, some of the Nordics have that. What would Steve Case do to stop this insane, unproductive debate about immigration and recruitment and fix it?

SPEAKER_19: Well, I did work on this quite actively even 10 years ago when I was on, uh, President Obama's Jobs and Competitiveness Council. And we've made a number of recommendations. I even testified in the Senate, I think it was probably eight or nine years ago, around, uh, the need for immigration reform. And you're right. You know, one of the ways we, we have become the leader is we have been a magnet for, for talent. People all around the world want to be part of America, want to, you know, move here and learn here and build here.

SPEAKER_18: And it has gotten more difficult in recent years to come.

SPEAKER_19: It has gotten more difficult to stay. And that is part of the risk that we now face as a nation. Uh, in terms of specific policies, one thing almost got done this summer.

SPEAKER_18: There's something called the startup visa provision was actually in the legislation that ultimately passed called the Chips and Science Act.

SPEAKER_19: There were some great things about funding semiconductor, you know, kind of onshoring here, which is positive. Uh, also some things around funding regional hubs, $10 billion authorized for regional hubs, which will be helpful, obviously, to what we're doing with, with rise of rest. But the startup visa provision was in there as well. That would allow people coming to universities here to stay. And that's something that's got broad bipartisan support, but just didn't quite get done this. Why?

SPEAKER_42: What is the sticking point here?

David Friedberg: It seems so obvious if we have, we have over 10 million jobs in the middle of whatever we're going through right now, this quasi recession, downturn, deflation period of assets. We have 10 or 10 million jobs.

SPEAKER_13: Why can't we all agree that a million smart people can stay in this country and start companies here, maybe even tax them in a unique way. If you want to come here and start a company, you pay an extra 250 K a year to do that for 10 years or something. And if you create a certain number of jobs, you don't have to pay it. Well, why can't we get through this if it's bipartisan?

SPEAKER_10: I'm so confused.

SPEAKER_16: It is confusing and it's frustrating.

SPEAKER_18: But the reason is that particular provision essentially around high skilled immigration does have broad bipartisan support.

SPEAKER_19: But immigration is, you know, is complicated. There are many aspects to it, protecting the border, what to do with dreamers, other things.

SPEAKER_18: And the tendency is for these things to all get combined and looking for a broader, more comprehensive solution. And that is more difficult politically.

SPEAKER_19: So that's why it needs some focus on more specific aspects, such as the startup visa might be the best way to move forward there. But to your core question, you know, both around global competition between the United States and China and other countries and need to innovate and back more entrepreneurs is a key part of it. I think winning this global battle for talent, continuing to be this magnet for talent is likely the most important way for America to continue to maintain the lead. But if we lose our lead, it probably will be over this issue that we will have lost that that status of being the magnet that people want to come to the place they want to live and live and work and build. And hopefully we can pass some sensible immigration reform, at least on this particular part of it sooner rather than later.

David Friedberg: I think we have to reframe it. If we put it onto immigration, everybody starts thinking they're going to take our jobs and somebody's running across the border and they're with a backpack full of fentanyl. Let's call it recruiting. You know, like we need to recruit job creators. And if you frame it as we're going to recruit entrepreneurs to create jobs for Americans, and there's 500,000 slots a year available, you apply to it. You tell us what's your plan to create more high paying jobs with great benefits. And we'll have some organization that assesses that. And yeah, if the venture capital is back you. Great. What I see so many times is people go to Canada now. And I was in Canada a couple of years ago on a speaking gig.

SPEAKER_10: Some people from Vancouver are like, listen, you ever have problems getting into us? Just call our office. We'll get your entrepreneurs here. We want the jobs here. And then they can hang out here. You're in the same time zone. And then eventually while they work on getting to America, they get there. But Canada sees our failure in this regard as their opportunity. Absolutely.

SPEAKER_88: Even the Canadians even put up a billboard in Silicon Valley a few years ago saying, come to Canada.

SPEAKER_19: We'll make it easy for you. They do have a very smart immigration policy. So I totally agree with what you're saying. We need to address this. And by the fact that we're unable to address it puts our country at real risk.

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SPEAKER_27: Let me ask you about another political issue. This is, you know, I've learned later in my career.

David Friedberg: We both were entrepreneurs and then we both became capital allocators. Right.

SPEAKER_10: And you start raising funds. You start learning about the limitations. You raise a venture fund. You can have whatever 2000 what's called qualified purchasers. These are organizations or people with 5 million or more for the audience. They don't know.

David Friedberg: You have maybe 99 to 250 accredited investors, depending on the scale of the fund.

SPEAKER_13: If you have 250, you're capped at 10 million. We're sitting here and people want access to venture capital.

SPEAKER_70: We saw that they were buying NFTs. They were buying Ethereum. They were buying crypto assets that did not have products associated with them. Yet somebody who is incredibly smart, who drives an Uber or host an Airbnb or works in HR at AOL back in the day. They're not allowed to use those great services, LinkedIn, Uber, Airbnb, and buy shares in them.

SPEAKER_13: Or look at who the venture capital firm behind them is and say, I want to be an LP in that. What is wrong with capital formation in America and how do we fix it?

SPEAKER_18: Well, it's again, something I've been working on for a while, including the jumpstarting our Business Startups Act that passed Congress about 10 years ago. The Jobs Act had some provisions around equity crowdfunding that were a step in the right direction.

SPEAKER_125: Did those work, by the way?

SPEAKER_42: They seem to be working slowly.

SPEAKER_18: They work slowly because the SEC put regulations in place slowly and their overarching concern, which is, you know, something that's fair to consider, but shouldn't necessarily be, you know, the driver is protecting consumers, you know, protecting investors.

SPEAKER_19: Yeah. And some of the things you mentioned in the crypto space or SPAC space or other things, people lost a lot of money. And so the regulators say, oh, we better make sure that people are protected. And sometimes the desire to protect people, which is understandable, trumps the broader imperative, which is both democratizing access to the innovation economy for people who want to invest in the innovation economy and also, you know, giving more entrepreneurs with ideas, access to the capital they need to start and scale. So, again, that is an area where I think we need more attention on, you know, not just what could go wrong, but also what might go right and make sure we're thinking about the benefits that can come both from the investors being able to back some of these companies at an earlier stage where a lot of the value is created, as well as how many more entrepreneurs can get back that might start some of these great companies. These great companies and things have clearly changed in the in the IPO market when companies like mine, AOL was going public.

SPEAKER_18: It was 1992, so 30 years ago, the first internet company go public, we raised $10 million in our IPO and the value of the company that day was $70 million.

SPEAKER_19: And other companies like Amazon, Microsoft, Intuit were going public in that timeframe. They are all worth a few hundred million dollars.

SPEAKER_18: Of course, now nobody goes public when they're worth a few hundred million dollars. Generally, they don't go public till they're worth $100 billion, sometimes, sometimes more.

SPEAKER_19: And as a result, the venture capital investors can do well, but the individual private investors miss out on that. By the time they're given an opportunity to invest, a lot of the upside has already been taken. So I do think it's important to give more people access to investing in companies at an earlier stage. And hopefully this next round of I know the SEC is looking at some some changes. Hopefully some of the changes will get made, which again would do the right things in terms of protecting investors while also enabling people to participate more with early stage investments in companies with proper disclosure.

SPEAKER_129: You know, it does seem to me, you can go to Vegas, uh, and having never played poker.

SPEAKER_131: I've used these arguments, my friend. Jump in a poker game and not know if a flush beats a straight.

SPEAKER_10: It's just crazy. I, I have a very simple solution to all this. You know, you drive a car and you, or your kids go get a driver's permit. You gotta take lessons at driver's class and, or you, you take a test, or if you wanna get a firearm and depending on the state you're in, you might have to take a little bit of a test. Why don't we have a test to make people sophisticated? I've been watching some of these, um, really aspiring angel investors and they're, they're going and doing like series 67 Bs or whatever that have nothing to do with investing in startups. But for some reason, the SEC says, Hey, this make would make you a credit if you had this. And they go take the test themselves and have like some weird backdoor that nobody's actually clear on if it's actually makes you accredited or not. Why don't we just get a test going here? I think it's fair.

SPEAKER_102: I think it's fair, but Jason, you need to, you know, spend more time, not just on your pods, but also, you know, talking to folks in Congress, folks in the SEC. God, those people. Well, it's painful, but it's important. And, and I do think that's one of the, I think we're entering an era.

SPEAKER_19: I know some people don't want to hear this, but I think it's true where, you know, policy is going to matter more. Uh, some of the sectors that are getting disrupted, like healthcare and food and financial services and many others that tend to be regulated businesses. People generally are don't like regulations, but do want to make sure that the drugs their parents are taking or the medical devices that are being used or, you know, that they actually work or the, you know, planes actually can fly. There's some, there's some safety issues and efficacy issues that I think people do think are important. And that's, that's where a lot of the innovation is going to start happening. This is less about apps in the app store and more about the internet meeting the real world. And so therefore policy regulatory issues are going to become more important. And one of the things I've urged, which part of the reason I'm on the board of TechNet is for the innovators, including a place like Silicon Valley to spend more time with the policymakers, educating them about some of the, you know, the challenges and some of the opportunities. So they are smarter about understanding, you know, what to focus on and can have, you know, perhaps some more creative solutions and might otherwise be, be, uh, be surfaced. All right.

SPEAKER_140: I'll do it. I'll get involved. You know, I talk about it incessantly on my podcast.

SPEAKER_102: I know you've talked to, I've heard you talk about it, which is great. That's, but the first step is talking. The first, the next step is putting into action, my friends. All right.

SPEAKER_27: Well, I'm going to do, I'm definitely going to do that. Let me, let me close with two things.

David Friedberg: Number one, how crazy are we to allow an app that's controlled by the Chinese government to be in the pockets and on the phone of every single person in America when they do not reciprocate and allow Twitter, Facebook, and other products in that country?

SPEAKER_77: How crazy is that? How crazy are we?

SPEAKER_18: There is a big, there is a big controversy obviously around tick tock, including here in Congress.

SPEAKER_19: I've talked to a number of folks who are taking a hard look at that and do have legitimate concerns. I've also talked to the CEO of tick tock and he understands the need to kind of create a clear firewall between what's happening with tick tock United States and what's happening in China. So I don't, I don't have all the, you know, the details about it, but I do recognize it. It's a, it's an app that's taken the world by storm, certainly taken this country by storm. It's used heavily by a lot of people. And I think there are considerable concerns about, you know, privacy and, and safety and, and certainly also extra concerns because of the, you know, connection with bike dance in China.

SPEAKER_145: We, we have no choice but to, to bifurcate that, that app from Chinese government access. I mean, that, that's what it comes down to.

SPEAKER_23: And I think that, I believe they're working on that. Yeah.

SPEAKER_13: I think they'll get there. All right. We've talked about this before. You're one of the great entrepreneurs of all time.

SPEAKER_70: You have now been to middle America.

David Friedberg: You understand not just the coastal elites and those cities, you understand the heartland. You, you put your money where your mouth is. You're telling me I got to get more involved in politics.

SPEAKER_136: When is Steve case going to get more involved in politics? Are you ever going to make my dream come true and run for public office?

SPEAKER_70: Because I listen, I love to have the idea of Bloomberg being president. I got all behind that. That got me very excited, but you running for president to me would be the dream that founder of American online, somebody who understands business, somebody who understands capital formation, somebody who actually understands politics and could bring this country together.

SPEAKER_10: You're a moderate Democrat. If you were called on to serve, would you ever consider? Forget about the presidency, which is where you belong. That would have been AOL time one. It should have made you CEO president. That was the mistake. I'll say it. You don't have to say it.

SPEAKER_70: Would you ever consider in your third act entrepreneur, capital allocator, and then representing your country in any form?

SPEAKER_18: Would you consider? Well, well, you're very kind. And I remember we've had this discussion before. Made you very uncomfortable last time.

SPEAKER_103: I figured it was coming again. Yeah. Two things I'd say. One is I do think there's a big difference between policy and politics.

SPEAKER_19: And I'm quite engaged on policy and do it in a nonpartisan way, trying to be a bridge between Democrats and Republicans and particularly around innovation, entrepreneurship, which ties in with some of the things we've talked about in terms of capital issues and immigration issues and so forth. So I remain actively involved. I'm once again, co-chairing the National Advisory Council on Innovation and Entrepreneurship, working on industry of the future and working on regional hubs and so forth. But I think my best and highest use is to be doing that in a bipartisan way and being a bridge. And I've done that for a while and I think I'll continue to do that. I also think the second thing I think is a way for me to contribute to this country is to help the rest rise. And while one could argue why you could do that from the prism of being in politics, I've actually concluded I can be as effective, if not more effective, doing exactly what I'm doing. You know, championing these entrepreneurs, spotlighting these cities, whether it's creating a fund to invest in them or writing a book to tell their stories. I think if we can back more entrepreneurs in more places, we can help more cities, communities more broadly, regions be renewed. We can help, you know, create more jobs in those places, more opportunity in those places. That could have a very positive impact on politics and maybe even help bridge this political divide, this hyper partisanship that we have. And there are many facets to it, for sure. I don't want to be overly simplistic. But one is this opportunity gap. And the data is pretty compelling that there are definitely a lot of people, probably about 70% of the people that are anxious and fearful about the future, not optimistic about the future. And we have to change that. And the only way I believe we can change that is to create more opportunity for them, more jobs for them in their own communities, in their own backyard. And the only way I think we can do that is if we back more startups, support more entrepreneurs launching in those cities. And the only way to do that is to shine a spotlight on those entrepreneurs, on those cities, get some of that coastal venture capital paying attention to what's happening in dozens of cities all across the country. So just for me, I think it's the best way I can contribute.

SPEAKER_102: So I'm grateful for your continued enthusiasm and support and championing my candidacy. But I think I'll continue to be try to be the entrepreneur in chief on behalf of the entrepreneurs all across this country who I think can build the next great chapter of the American story and do it in a more inclusive way and do it in a way that maximizes the likelihood we remain the leader of the pack in terms of global innovation.

SPEAKER_10: Well, you know, here's the thing, Steve Bannon, he saw with JD Vance's book, he saw these people feel in middle America, Appalachia, wherever, people felt like they weren't part of America anymore.

SPEAKER_70: And he used it to get Trump into office and it did work.

SPEAKER_10: And now I think what you're doing with this incredible work, investing in visiting and spending time and the rise of the rest movement, I think what you're doing is actually helping solve that problem. Not just capitalize on it for yourself or some personal gain or power, but to actually turn it around. And that would be the next chapter of this. I think if we can make people in middle America, like you're doing with these investments, small investments, one at a time, 200 of them, you know, we make people there feel like they're part of it and they have an equal stake in America. Yeah, maybe we could have a bipartisan ticket. We could have a bipartisan ticket.

SPEAKER_77: We you don't identify exactly as Republican or Democrat, right? I'm independent. I'm independent like me.

SPEAKER_19: I'm one of those people in those middle that, you know, it's a group of people that are frustrated by the impasse we're now seeing in politics. So hopefully there'll be more and more of a mobilization that, you know, kind of sometimes too silent middle will kind of step up more. But you mentioned Appalachia, one of the companies we backed, started about five years ago, a company called App Harvest in coal country outside of Eastern Kentucky. I know. Yeah. And that company now has 500 jobs in an area that for decades there was just despair, opioid problems, et cetera, et cetera. This is because an entrepreneur had an idea and started a company that scaled nicely and creating opportunity and hope in that place. We just need to do that in other places. And based on what I've seen on the road in the last decade, again, the whole reason to write the book, it's amazing what's happening, not one or two cities, not just in Austin or Seattle or Miami. There'll be several dozen cities that really are writing the new the next chapter, I should say, in the American story. And it's exciting and surprising to me. I think most people reading the book have been surprised by how many cities are really on the rise. We just need to champion them. And if we could do that, then maybe this country will be a little more united and be a little more, you know, kind of stronger globally in terms of what's happening. All right, listen, I appreciate you.

SPEAKER_155: You've always been a mensch to me my whole career.

David Friedberg: When I was a kid, I asked for a selfie at AOL. The green AOL greenhouse supported me. Ted bought my second company. Been a mensch, uh, an inspiration to me as I've come up as an entrepreneur and you're, you're just a national treasure for here for America and the work you do.

SPEAKER_10: We appreciate you. Everybody go buy the book right now. Steve actually took the time to read the audio book like a real author does. And, uh, I just finished the audio book actually this morning.

David Friedberg: It's fantastic. Must listen for everybody. And, uh, continued success. Steve Piss, 20, 28. You got my vote if you ever do it.

SPEAKER_103: Thank you, Jake. Well, great being with you as always. All right. Talk to you soon. Come to Washington and talk about, talk with the SEC in Congress and join us on our class as we hit the road all across America.

SPEAKER_159: I'm in.

SPEAKER_10: I'm in. I'll do a couple episodes from the road with you and I I'd love to actually, I don't know how DC works, but I would love to just like interview you or a couple of people about evolving securities law. What do I do? Just rent a movie theater and just invite people to come and just have a conversation.

SPEAKER_161: We'll set something up.

SPEAKER_10: Let's do it. Let's do it.

SPEAKER_13: Let's change these investor laws. All right, everybody. Steve case rise of the rest. Stop what you're doing and buy it right now. I'll see you, uh, hopefully soon on this, uh, bus tour and, and, and DC on the road.

SPEAKER_163: Thanks everybody.

SPEAKER_13: Cheers brother. Cheers. Cheers. Cheers.