with Marc Andreessen (@pmarca), Ben Horowitz (@bhorowitz), and Tyler Cowen (@tylercowen)
This episode of the a16z Podcast features the rare combination of a16z co-founders Marc Andreessen and Ben Horowitz in conversation, together, with economist Tyler Cowen (chair of economics at George Mason University and chairman and general director of the Mercatus Center there, and host of his own podcast.) The conversation originally took place at our most recent annual innovation Summit -- which features a16z speakers and invited experts from various organizations discussing innovation at companies large and small, as well as tech trends spanning bio, consumer, crypto, fintech, and more.
This discussion covers Ben and Marc's marriage, er, partnership; the evolution of VC and "talent as a network"; and where are we right now on industries being affected by tech (such as retail) and tech trends (such as VR/AR and wearables) -- and where are we going next? Finally, is software eating culture... or is it the other way around?
United States


00:00:00hi everyone welcome to the a six in the podcast today's episode features a six since he co founders mark Andriessen and Ben Horowitz in conversation with economists Tyler Cohen who is chair of economics at George Mason University and chairman and general director of the Mercatus center there and
00:00:14also has a podcast conversations with Tyler the discussion originally took place at our most recent annual innovation summit and covers everything from talent and tech trends to suffer eating culture or the other way around you can also find other podcasts and videos from this event at a six
00:00:31since the dot com slash summit thank you all for coming I'd like to start with the two of you as a couple area how was it you met at Netscape in nineteen ninety five will mark interviewed me in a way back then and he interviewed me I think
00:00:46I was in a very as for product management role on his the founder of the company and I had worked on a product called lotus notes and mark had a fascination with lotus notes for a couple reasons one was it was kind of sort of a close is
00:01:00proprietary thing to the internet and then they had email in it and then that's good because look at doing email set all kinds of questions for me and I remember him just being absolutely shocked and flabbergasted that like fifty percent of our code base in lotus notes was
00:01:17just making like all the land protocols work together I. P. acts an apple talk and net booby net bios still is I you guys don't even know what that is anymore it was like literally just making the network talk to each other which he thought was like ridiculous
00:01:33given their STC P. IP I thought that was the very first conversation we have mark how did he do in the interview he did very good so here is an asset he was the first employee from lotus and so he look great in comparison all the ones we
00:01:46haven't seen before no yeah he did great he was he was super knowledgeable and actually is is actually really big deal at the time because lotus notes was a big thing at the time and that would have been just a little too and architecture like it it just
00:01:58it basically assume that the internet was not going to work which was the dominant assumption at that time was gonna how the whole thing was built in the most of the people working on it I think probably agreed with that like you've been in there many many arguments
00:02:08of internet couldn't possibly do what a system with but it's not stand so Ben was I was a young enough and smart enough and all will have to figure out you know very early among his core of kind of the professionals in the space that it actually was
00:02:18gonna happen differently yet and so and you know look we were a little fly by night sort of so so we fast forward to nineteen ninety nine you to do loud cloud together why had that happen well so the big thing basically what happened was so it turns
00:02:32out the internet worked which turned out to be a big deal go figure and then basically what happened was missing people are unprepared for the internet to work at some fundamental level and then we saw a very specific kind of version of people being unprepared for that which
00:02:43is we sold escape in nineteen ninety eight to a well that's a bit better nine a bunch of us working there well then it will have this thing at the time mail was a little bit like the Google of error or something where he was just a absolutely
00:02:53they have like a fire hose a traffic that they could basically stir wherever they want to steer it in so if you want a well when you type in by close off the traffic on the internet went through a well I remember that it was a really big
00:03:03deal my half by the way %HESITATION but that's a lot still have this right right about where most of consumers right almost all consumers are unable to times you type in my you know my clothes on a well in it would you know then they would sell you
00:03:13know to like J. crew were gap or you know whatever that slot and then basically what happened is that advertising business and then it will turn on that out and it was in the base of the fires of traffic which is blast the website to bits right of
00:03:24way of checking his blast the joker website about an object %HESITATION people would spend weeks trying to the website to work to actually take advantage of all this traffic and so it was sort of you know it it just seems kind of obvious in that we you know
00:03:35we were kind of in this business and so you go talk to people running these things and they just they didn't they were just I'm prepared for this kind of sophistication and so it we sort of incubator this idea that boy what if there was a cloud right
00:03:46what if what if basically there was a system in which you could take your con know your apps and you could run a minute could handle the load and you could you know it's a load balancer could spike up in response to the man and then all these
00:03:54companies instead of being in the business of running all your own stuff like why can't you just hand over the pros are SO in and then this is the full flush of the dot com boom is so just seem like an obvious opportunity and the two thousand nine
00:04:04comes along and and why is it it seems to you both and that's the right time for a new venture capital firm what was the thought for euros it was really one of those ideas that just came out of our experience yeah we were customers venture capital and
00:04:19you know we had a couple of observations one was you know we we had noticed over the years and and mark really made the observation first that most of the really great companies like forget about successful but like great companies convince you admire intact were all run by
00:04:34their families for a very long time so going back to Thomas Watson an idea emerged date Packard bell feel at that your Packard or you know Bill Gates sur who whoever it was all the really giant successes were run by their founders and the conventional wisdom in venture
00:04:50capital is set up to replace the founder and then in our own experiences as technical founders we knew why that was true because yeah well if you just check you know local like nobody would have ever been able to fix Loudcloud other than us like there was no
00:05:05way you could bring in a professional to do that and so getting to that next product after you get the first product into the next product market fit required an innovator answer she wanted subsequent product cycles you needed the founder and so we just thought there ought to
00:05:20be a firm that is designed to do that and what is it that the two have you figured out what is it you to understood that other people didn't and how would you articulate that you know like we we were just there is a bunch of things one
00:05:33differentiation feel like we came from the companies or like first we're gonna tell a very clear sharp story about a real network that we dealt out systematically we've got people are going on your Ford you know exactly how to build companies so sometimes it feels to some people
00:05:47there's a lot of money running around but talent is quite scarce what is it that you two in the company as a whole have understood about talent search that other people have not so we actually thought of it as a talent business law on the reason for that
00:05:59is you know a friend of ours Michael Ovitz who founded the talent agency C. A. was of board member of ours that apps were and you know he always thought about how talent in amazing detail and like an incredibly specific on one of his biggest concepts about it
00:06:16was it was a network and you have to run any it seems simple it's a network okay great but like how do you build that network how does it work how do you take a long view of the relations it's with the talent and so you know we
00:06:29really thought out very early on we're going to invest heavily in building this network and having the time the luxury of time to build real relationships as opposed to transactional relationships with every single person that we run into began engineer and entrepreneur a corporate partner or whomever and
00:06:50that all kind of came out of this original CA concept if you take a long view of relationships you can build a network that so powerful that nobody will ever be able to match it and that was kind of the original inspiration and and we were fortunate enough
00:07:04to just hire a really astoundingly good team to help us do that and mark how do you think about talent assessment so I think you know the other side of it is just is Yonge burner assessment right and so it's just one of those things where you know
00:07:15there is kind of this fundamental question kind of how extreme are you willing to get right with some of these people into some you know that we have the kinds of people to start these companies are not normal %HESITATION and we can say that speaking from experience of
00:07:26ourselves and so and I don't I don't ask us a first are you like it may be that the founders are getting less normal as sort of society gets let's just a more interesting in recent years and so you know the ideas are getting bigger the technologies are
00:07:37getting more disruptive the companies that winter getting much larger technologies more central everybody's lives but there is more competition than ever they're more tech service than ever and so the kind of very special person who's going to conceive of an original idea and then be able to build
00:07:49a team and be able to prosecute the idea is going to be very extreme person myself out of it as sort of this %HESITATION you know the discovery and and and and partnering with these really extreme people I mean affirmative few questions about particular technologies and either of
00:08:01you feel free to answer blockchain what will be the breakthrough application for blockchain I'll take that so first of all like asking what the killer app is nobody ever gets it right like I remember the internet killer I was never Facebook that's for sure the way that we
00:08:15think about blocking technology is that it's a new computing platform M. like other new computing platforms that preceded it it's worse in every way but really a very few ways so if you think about the smartphone when it came out it was much worse than the PC and
00:08:33a tiny screen it was far less powerful etcetera etcetera people were like how my gonna run my spreadsheet on that little last screen like that is the way it's gonna work but at a couple properties again having the PC it had a GPS that had a camera and
00:08:47so that you can now build things like left you can now build things like Instagram but you could never build on a PC and you still can't build on PC and it created a whole New World of applications blockchain is like that it's slower it's harder to use
00:09:00it's harder program but it has a new feature and that features trust and trust is really really an interesting feature because it means that you don't have to trust the government or corporation or your lawyer you just have to trust the mathematical properties in the game theoretic properties
00:09:21of the system and then you can do things and it opens up applications such as you can program money you can program contracts you can create digital property which is you know if you just think about the art world it's an amazing kind of world and it's all
00:09:39virtual value you know boss gets a hundred fifty million dollars but like the campus is probably less than five dollars but because you know that's one of one it's got valuable you can now do that digitally with blockchain so there's those kinds of things and then you don't
00:09:52have to trust companies so if your developer in your building an application you you know you don't have to trust Facebook to not go well like you know we decided like we're changing our privacy policy you can't run anymore where's your consumer you have to say okay like
00:10:04I I'm going to trust you with my data that property of trust we think it's very very powerful and there is a large set of applications that will come off of that but you know like it it takes a while for to get used to it for the
00:10:16technology to mature and so forth but it's one of the things we're most excited about paint a picture for me fifteen years from now retail and wearables what will tech do for me in those areas that it's not doing right now retail will basically be gone by then
00:10:33I mean I can go to the shopping mall and he wants to go to the shop I want to go to the shopping you can go okay don't have special preserve shopping malls okay %HESITATION near Washington DC the Sony will have a shopping mall %HESITATION that that you
00:10:48can visit %HESITATION you in fact yeah you you can drive there on a special road for your non self driving car %HESITATION this seven tire horse about back so %HESITATION so I mean there there will be there experience of the terms espresso retail so like experiences like if
00:11:06it's not what I mean if it's like a good should be taken as a whole experience to go there it's an apple store it's a you know it's got something where it's like there's like real magnetic appeal to the experience and fair enough right and there's there's like
00:11:14a bunch companies were involved and they're doing things like that but like it you know the idea of where to buy a bunch of stuff that other people may can we're gonna put it in a big box and we're gonna make everybody drive to the big box like
00:11:24the president are kind of two full number one as consumers don't rescue want what you want to see what the Star Trek replicator right like what you want is like you press the button like there's my stuff right like you were great on Star Trek with like we
00:11:35don't quite have that we don't actually have a material as we are but we do have the ability press the button and stuff just dropped off so and the the logistics infrastructure in support of livers gonna built out right very very rapidly now and so that I think
00:11:45the convicts remembers cutting over quite quickly in any other problems just kind of traditional it's a third party retail where you're not selling your own products on somebody else's product is you just can't be basically your your levered as a retailer right you you basically live on the
00:11:57basis of credit from suppliers and the problem with that so you're kind of like an over lever banking a lot of ways and so the problem with that is you lose this is in no retailer of other people's products or they could lose thirty percent of the revenue
00:12:07and on the stand business which is why you see these retailers is going bankrupt like all the time right it's like toys R. us was that you know the most recent big one like it detonated in that it detonated so hard that actually went into full liquidation right
00:12:18which everybody thought it obvious is toys R. us like people want toys like kids look like obviously if somebody was gonna buy toys R. us and the there's just no way to make the math work and so I just I just think it's over lever business and it's
00:12:28it's not partisan but I know what is going to do is %HESITATION interesting it's gonna open up all the space right and so there's a whole revitalization physical environments is going to happen read including you know you you see that happening already in cities but I think it's
00:12:39gonna happen all over the place because a lot of the space is gonna open up for us it's a more interesting uses so instead of going shopping I'm gonna do something with my wearables and what will that be what's the potential and wearable I think the really big
00:12:50on right now is I think audio no audio is on the rise just just generally in Wrigley apple you know what the error pas is just I think it an absolute home run it's one of the most deceptively no thanks is just like this little product and like
00:13:01how important could it be and I think it's like tremendously important because it's basically just like a voice in your ear anytime you want and so you have that well I just give you one example there now these you too you know there's these new kinda new kinds
00:13:10you to celebrities and everybody's kind of wondering like what you know where people getting all the spare time to like watching these you tube videos listen all these you to you know people you know in the tens and tens of millions of the answers like their work read
00:13:23because they were like a Bluetooth food too thing either in about a half right that's ten hours on the fork left right ten hours of your rug right and so like that's a big deal to voice your all the time and of course speeches as a U. eyes
00:13:34on his is rapidly on the rise and so I think audio is going to be you know Titanic report and I was a second ago nominee for wearables is just generally the concept of sensors on the body right inside the ear the apple watch's is clearly on the
00:13:45lead with what they're doing with the heart rate sensor but I think we'll have a full complement of medical grade sensors on you know and on our bodies in a way that we have chosen to over the next five or ten years and I think we're I think
00:13:55we'll get to the point where we're gonna be able to do things like predict heart attacks and strokes before they happen by things I mean talk about like a talk about a killer app like I'm gonna be if I'm gonna have a heart attack and four hours maybe
00:14:05I should drive to the hospital the survival rate for heart attack in the hospital is like ninety nine percent survival rate for her detective homes like fifty percent like there's an opportunity for like a massive increase of of of quality of life with the sensor platforms you were
00:14:16going to have and then I think I think optics are coming right and it's gonna be a long road but I think they are incurable to work and I think there is a we're gonna have heads up displays there is that also going to remove the need to
00:14:26you know what we have now which is kind of this little clinic last were expected to kind of experience the whole world through right the whole world in open up around us what what what are we gonna do with augmented reality and virtual reality so I'm the believers
00:14:37in both I think air has you know tons of potential applications both at work and at home we can spend a lot of time on that I think we are going to be like a thousand times bigger in the valley right now this is a very contrarian view
00:14:47because I knew that the general kind of thing that you're in the valley as there is any bigger than we are and it seems like obviously a are should be bigger than the R. because obviously if you can do things overlaid on the real world that should be
00:14:57sort of inherently more interesting than having to construct sort of a synthetic world I just think that that's only true for people who live in a very interesting place in the real world which we all do but you know only you know something between my point one percent
00:15:09one percent of people on earth live in a place where it's like they wake up every morning I like wow there's so many interesting things to see right like most people don't live in a place like that right and so for everybody who doesn't already live on a
00:15:20college campus or in Silicon Valley %HESITATION in a major city the new environments are to be able to create and we are going to be an inherently much more interesting right from the physical environments and there's gonna be a lot more of them %HESITATION to choose from and
00:15:31so it's it's gonna be amazing then there's a tweet I've been dying to ask you about there's two types of people in this world fresh prince of Bel Air people and more in people I'm a more in person for what it's worth whose Martin I think made road
00:15:47suite and I I replied to it so to %HESITATION kind of major African American television shows out in the early nineties %HESITATION the fresh prince of Bel Air which was based on a rapper known as a fresh prince and his DJ DJ jazzy Jeff the fresh prince is
00:16:04actually bill Smith him I know but the more in this what puzzled me Martin is %HESITATION Martin Lawrence who is %HESITATION comedian a genius comedian who is also incredibly crazy so crazy that his specials called you so crazy %HESITATION is this like a very very crazy guy but
00:16:20the fresh prince of Bel Air was kinda like the the hood Beverly hillbillies it's kind of like you know you you get the black people from the inner city and you put him in Beverly hills and it's kind of funny and it's safe for you know everybody there's
00:16:34nothing to actually you know keep the kinda easy and wires Martin was like just fall out like Martin was like actually the hoods and he was not some like the whole thing was great and so I was that was my show that would make sense could you recommend
00:16:49a wrapper for people who think they do not like rap music Will Smith real fresh prince of Bel Air and as mark like Will Smith market if we think about television as presenting conceptual material to us every now and then you you'll watch TV shows what's the TV
00:17:14show you've been watching lately that has a lesson in it about venture capital and what's that lesson can I name three yes I watch a lot of TV halt and catch fire which actually recently ended after four seasons all catch fire when it came out came out right
00:17:27after mad men and it came out as kind of people like what's kind like mad men but it's like much more of like a pot boiler it's like super like dramatic in there like it's just all the emotionality of it like you know it's about this creation of
00:17:36this is about the creation of a compact the the PC company early eighties as a thinly veiled kind of starts out kind of it without the birth of the PC and so the critics are likely this is like two dramatic and and like to add anything but I
00:17:47watch over like you know no that's it's not right it's it was like literally going back in time is exactly right it really is like that American that stressful and that crazy yeah and so so shouldn't the first season of that so I think it it's it's the
00:18:00most accurate portrayal of a tech startup is actually like that's ever been aired so that's one another one that I really like %HESITATION for founders to watch and they always think I'm crazy but I I really really believe this %HESITATION there's a there's a great show on USA
00:18:11years ago called burn notice %HESITATION %HESITATION was a very fun show %HESITATION is about a spider gotten burned as the eyes five don't burn it had a whole of Miami to our tractors namely took on always odd jobs so little set up to consider the show once though
00:18:24he had every conceivable skill you can possibly half right and so he knew how to make like explosives on a bleach like he knew how to like you know I don't know like to some somebody with a mop handle like whatever circumstance he was and he had there
00:18:35and there was a voice over here explaining haven't hired him yeah well you we would we would love to hire but basically I would get I mean it's like that's the kind of that's that's a good founder like a a good founder has to basically have every conceivable
00:18:45skill like you basically have to be good at problem moment and it marketing and sales and finance it legal entities are in management and you know on and on and on and on and and there really is no substitute for actually being good at all these things and
00:18:57so I like that one and then the third one is succession which I just finished %HESITATION is one of the darker %HESITATION and funniest things I've ever seen and let's just say %HESITATION it's a it's a it's a it's inspiring for founders does it it I think pretty
00:19:10actually shows the dysfunction and it's %HESITATION it's a certain kinds of larger companies it's a show about a succession battle at a major media company and I can't recommend it highly enough if you've got the stomach for bad words said then the company is starting something called cultural
00:19:25leadership fund what are the strengths and weaknesses of applying the venture capital model to culture and entertainment I think we're trying to apply culture to the venture capital model so it's a little bit the opposite looking to either back to your earlier question you know what we really
00:19:39pride ourselves on being able to understand talent and talent of all kinds and you know one of things we did very early as we built a lot of relationships with geniuses at moving culture and we thought this was important because as tech was moving into much more kind
00:19:57of consumer oriented shield %HESITATION when we started the firm that the people who really knew how to change and create new consumer behaviors would be interesting so we you know had relationships with all these cultural geniuses like Quincy Smith and Sean puffy combs and nice and and so
00:20:15forth but we were doing it kind of fairly one off and we thought you know would be really great you know it and there was a great advantage for us then OPR had one of our %HESITATION entrepreneurs on her favorite thing so but we thought you know who
00:20:28is a good thing to share with the rest of the industry and so we would have these cultural geniuses but in a genius is but who didn't look like the geniuses are guys were used to like you know mark sucker burger Franceschi they kind of felt different but
00:20:43our guys were interested in working with them so we put them together they get to know each other which is good value on both sides and it also gives a lot of value to our CEOs because not only did they get to kind of learn how to move
00:20:56culture but they also get to learn about how different kind of town looks like %HESITATION which is very very valuable when you're kind of area in the war for talent and then we invested back in kind of young African Americans who are wanting to come into tax so
00:21:12we created talent pipeline with the find and we have straight access to the pipeline so I would say we get a lot of credit for being nice but we're real happy just winning so it's gone right I think it works well and and like you know the the
00:21:25main thesis is you know if you've got like a very small group of people that created every new musical art form in the last century from jazz to blues to hip hop to rock and roll you know like that's a real thing and like to be able to
00:21:38do that and that's a real talent base that you know we need to figure out how to get to and we're here in Los Angeles were very close to Hollywood what is it conceptually that Hollywood graphs about venture capital and talent identification with Silicon Valley lags behind well
00:21:56I think at the end of it I just think of their different kinds of town so yeah and this is the thing that I think people make a mistake on when they think about you know how diversity works are inclusion works and so forth is fit there's count
00:22:09that looks different and then if you don't have that talent you might not be able to see them so you know in Hollywood they see certain kinds of talent that they're used to because they know what that is they know how it pops on screen they know how
00:22:22like people emotionally connect to it and then in Silicon Valley we know another kind of talent the United talent for like systems thinking and %HESITATION engineering in this kind of thing but both are very valuable when you put them in together in a company and so I think
00:22:37that you know in these numbers but we try to do is to see talent that were not and it's not easy thing to do and it's a story I tell the market had never profile one of things he looked at in her in places helpfulness and when I
00:22:50saw that it shocked me because I have been managing for like nearly thirty years at the time and I've never interviewed anybody on that I can't even see it like there's a thing that's an important talent very important town to a services firm like ours that I can
00:23:07even see so how my gonna hire if I can't see it and so we spent a lot of time at the firm trying to see talent that's not like us but also for good that it is certain that the L. A. the sucker down here so %HESITATION I
00:23:20think it's also very interesting time because you know for basically from when I entered tack in the early nineties up through college maybe twenty twelve twenty thirteen it was just gonna take it as a given that the Silicon Valley companies were never gonna figure out culture never answered
00:23:31our content is also taken as a given of media companies in every figure out tact and there are tons of attempts to kind of cross over but it basically did none of them worked and he really is in the last like three years it feels like it feels
00:23:42like a bunch of our companies are really starting to decode culture of what's the big I mean the first thing I can't Nestle sort of you know some sort of setting a new model but now being in a replicated by the company's Amazon being the most notable example
00:23:52you don't become a big forces and the crew in the formation of culture and entertainment and media and then and then also by the way the other is the flip side is that a bunch of big media companies now if you got a point within a tech tech
00:24:02incredibly seriously and have been a really sure people working for them working on very interesting projects and then there's a whole tax thing obviously now happening down here in LA that's that's of a new level of magnitude than before %HESITATION and so does feel like both of the
00:24:13kind of central house in California are developing a crossing over you know quite nicely now general question twenty years from now we'll location and being in the bay area matter more or less yes clearly both so on the one hand it is absolutely true I mean in twenty
00:24:28years you know the telephone basically telepresence technologies rose video conferencing and we are in all these things like twenty or so there's no question it's gonna be like much easier to run large distributed organizations large distributed a person is today right we're we're gonna have such high fidelity
00:24:41video conferencing everywhere you can actually see this today if you see the super high video conferencing systems it really is like you were there when we have these robots that we love in our office some you see in the the beams which are a prototype of what I
00:24:52think it I think telepresence provides actually to be a very big deal because they give you a sense of physical presence of somebody in a room this even different than a screen is only for those technologies the club technologies like slack and get a writer becoming really good
00:25:03today in a twenty years they're gonna be you know just spectacularly amazing and so it's going to be easier to run all these companies and be able to run all these efforts on a broad basis and then it's just make it much more straight for for people all
00:25:14over the world to participate so that's the one hand but the other thing that was just like okay that's gonna be a world this much more connected right much more networks right is going to be you know past five you were gonna be a like nine or ten
00:25:24or eleven G. right it's gonna be banned with everywhere it's going to be everybody's gonna be online all the time Graham all these you know wearables being I wanted to be part everybody's daily experience all the time you know the economy's gonna reform itself around software network of
00:25:35facts and so the winning companies you know the winning opera companies twenty years from now that women are going to be staggeringly large like they're going to be like I don't know ten or a hundred times a sizeable on Facebook and so the price to have a start
00:25:48up that scales and wins is going to become so large that you're gonna wanna hyper optimize every possible thing you could possibly do to have that extra chance that you're gonna be the one that wins right in and that's going to mean like people in the same room
00:25:59together right and so I I think the valleys actually gonna become more central not less central even though the technologies that we're building are making it possible for the world to distribute band I love your book on management it's the only book on management I've ever given to
00:26:12my daughter you know I knew I had a one chance I pick yours in your view what is the best predictor nodded innovation we've talked about that but if simple managerial intelligence how do you spot that and what does it consist of voting you know it's interesting it's
00:26:27through skills that don't normally go together so it's this systems thinking which is you know and I haven't even noticed mark actually point this out to me many years ago which is most people are not systems thinkers meaning they can not think about okay if I change this
00:26:46here then it's gonna fact that over there and you know you know as an economist people always make these dumb mistakes like okay we'll move the minimum wage and nothing else will happen it's like well no no it's a system you have to think of it in terms
00:26:58of the system and so that's kind of part of it die and a big part of it and but the other part which is can you actually see the people in your organization like do you know who they are as opposed to you're talking to them like they
00:27:14are you and meaning you understand their motivation do you understand what they would think about something if they were in the room and you're making a decision can you interpret them well enough so that it's as though there there and can you understand the implications through the eyes
00:27:31of the people who work for you and if you have those two things together those are the people who are really great but it's a rare thing and you can kind of see it because you'll be talking to them in the like you might not be able to
00:27:42articulate something and they can articulate for you the way you would have done better %HESITATION like somebody who's that perceptive on people plus the system's banker is really the the those of the people are gifted and mark did you really invent the tweet storm and if so what's
00:27:57the general lesson about innovation we should learn from that %HESITATION what is the general is a journalism %HESITATION inability to shut up I think may have had a lot to do with it %HESITATION but you did invented I think there might have been sequences of tweets but literally
00:28:11I can shut up so like I think it kind of catalyst look I I mean the big lesson from it has been the big lesson actually a lot of a lot of different platforms such as emergent behavior is incredibly important right the really successful platforms let the user
00:28:22surface the behaviors right the fate of the greater supply from could have never thought of and you know Twitter set all kinds of issues over the years but like it always has been amazing mostly compelling ways in which people use Twitter have been invented by the users I
00:28:32mean and I think it's for retreats were invented by users right thank you very very fundamental features and and that's not just whether that's also bench it was true of actually personal computers at Mr smartphones it's been for of you know many of these platforms and so it's
00:28:43I think it's a useful principal our product design which let users in a bit Ben you're famous actually for your barbecue cooking view it as a problem of management and also innovation what makes for the difference between good and truly excellent barbecue time they more time so you
00:29:01know it's funny I had the an interesting conversation years ago with my wife's cousin Atlee Kanye west which was just like a weird thing because athletes from baton Rouge Louisiana and I happened to be in New Orleans and Kanye was there and we're all out to dinner and
00:29:19Kanye S. atleast as what's the definition of watchery which is like if you're from baton Rouge you just think of that word like you never hear the word lecturing and so at least as I just like to cook kind this is well how do you cookies as well
00:29:33like I like to make red beans and rice and he's like well how do you do that is like like take my time you know it cut the onions very slowly I boil it for a long time and make sure it simmers and kindness is exactly time is
00:29:46luxury like that's why I make lecture records I take my time and I was like yeah that's it so mark do you prefer to eat for profit sushi or nonprofit sushi this is how is favorite question to suss out whether people are actually pro government %HESITATION %HESITATION increase
00:30:05government services the idea of nonprofit sushi makes me so nauseous %HESITATION but I think I want to throw up on stage general question what is the one thing that Wall Street does not understand about technology that you would change if you could I think part of it is
00:30:22that it's a three thousand mile like thing I think a big part of its culture there's just a delay in there always has been and so you know if I if I wanted to fix that I would say like we you know we need to spend a lot
00:30:31more time and by the way the tech industry doesn't just a lot more time you know try to tell people what we're doing but the same time people from outside the tech industry need to spend more time in the valley and understand what's happening here and a lot
00:30:41of that is happening as well %HESITATION that's what I'm not sure I want to fix it yeah the question is is I want to fix it like I don't think I want to fix it because that's a big part of the opportunity what's the one thing the US
00:30:50government does not understand about tack that you would change if you could so I think the first thing is something that any gross said many years ago which is it's inevitable %HESITATION and so you know if somebody had asked him you know as the microprocessor good or bad
00:31:03he said well that's like asking is still good or bad is like we got to deal with it like it's here and I think that the in the biggest mistakes the government makes are assuming it's not so you know stem cells is a great one where the US
00:31:16government %HESITATION went to really hold that back then hold backs themselves like development research at all they just made it very inconvenient for people and I'd say it's a lot of people died and you know missed I'm curious and all kinds of things because of that and %HESITATION
00:31:30so I think that's number one then I think the other thing is that technology is always had and always will have good bad implications %HESITATION going back and forth the cotton gin the printing press %HESITATION you know certainly the internet has had good and bad but if you
00:31:46look at it overall it's overwhelmingly positive and more than that we have to go back to our population levels in like seventeen fifty if you're gonna take away technology and take away technological advancement because the way the human population is growing there's no way we can you know
00:32:07live the way we want eleven have a life you want to live without technology so that getting into these debates of whether we should hold it back is just you know if there's one thing I would change its like let's not have that debate let's have the debate
00:32:18how to make it great mark what's the last thing software will eat other than sushi live in sushi so I think it's fundamentally that the term you used actually called it by think projects election and so basically it's this question of like okay how do you organize a
00:32:37small number of people to do something new right and and by the way that could be a start up company likely many other kinds of efforts we need a small number of people to do something %HESITATION could be a new political campaign a new activist movement whatever but
00:32:46a small number of people to do something new right and how do you pick if you're gonna financer donator find those things have you pick which was to donate to and then how are those things actually gonna run right and and and that the new part is really
00:32:57important like the little known facts for example about venture capital is the the there's a term venture capital and had funds called Kerry basically called carried interest which is the sort of profit participation of the V. Caesar had some managers make the term Kerry actually comes from wailing
00:33:11in the sixteen hundreds off like you know the code that in in Atlantic Ocean like literally their term Kerry was the people who would finance the captain and the crew of the boat but the vote actually would run as a start up there is actually like equity participation
00:33:23for all the people on the boat and then they would be picking Japanese raise money in town to raise capital in the boat would go off and try to take away all right and about you know three quarters the time but we come back the third quarter the
00:33:36time well when the way woodwinds Moby Dick was was not a joke %HESITATION ands and so that the book comes back but sometimes on the time and then and then literally Kerry was the portion of the wealth that investors got right and so do you think about it
00:33:48like the process if you're like in you know I don't know if it's whatever basta river in like you know sixteen seventy five and you're trying to say okay this ship this captain this crew this mission into these waters right without these weather patterns like and how are
00:34:02they gonna behave under pressure and what's gonna happen if things go wrong it's a crew gonna beat me and like to make any money doing that's like the whole thing is just such an intricate kind of puzzle and it revolves around people and so the ticket in two
00:34:13percent of the whaling expedition you know certain of the group that into the into the Santa Maria exes and kind of thing text of so the same way by the way you know green lighting a movie or TV show in Hollywood is the exact same kind of process
00:34:23and it's just it's so intangible and it's so much based on the interaction of a small number of people who are gonna be under extreme pressure like if we if we can figure out a way to automate that like we find that company in the retire but at
00:34:34least we don't know how to do that for each of you what's an interesting book you've read lately SO with the one of the most interesting books I have read lately is %HESITATION Genghis Khan in the making the modern world by Jack Weatherford and it turns out to
00:34:47be very unexpectedly the most interesting book on the topic of how you think about inclusion that I've ever read and getting this kind is not known for his thoughts on inclusion he's mostly known for like being just ruthless but he really you know he's the guy who came
00:35:04from kind of the border of northern Mongolian Siberia very bad part of the world at a very very hard life growing up he was from kind of the lower %HESITATION they had white bonds and black phone kind of the higher and lower castes is a lower caste person
00:35:20and you know a lot of his experience growing up led him to this idea that he should choose for kind of talent not the caste system and not even the tribe that he was in which was a huge breakthrough at the time you know nobody had done that
00:35:34and the way he thought about it and the techniques that he used for doing it were breakthroughs today you know and and size from to be like super interesting but definitely a great management book for anybody who is interested in that topic mark so this book the books
00:35:51the biggest impact on me it's incredibly well written book its course a print is by %HESITATION actually of a guy I think that tell you know %HESITATION tumor crown stir %HESITATION in you know quite well so %HESITATION who's a economics and echo Thomas to Duke it do so
00:36:03it's about twenty years ago it's called a private tryst public lives and it basically tells a story the theory that he basically has because preference falsification and it's basically the idea it's it's a situation in which people believe something in their own had and then they feel for
00:36:16social reasons that they can't say it out loud and so it starts kind of without is kind of a an idea of any kind of extrapolates out kind of what happens as a society becomes the kind of society which people feel like they can't speak the things that
00:36:28they believe and it turns out to be quite an elaborate process because basically right you can have this very interesting situations we can have a majority people believe something but then they'll believe they can't say that but then as a consequence they all come to believe that there
00:36:39are many fewer people who believe it then there actually are in so you can kind of suppressive point of view artificially for quite a long time but then he describes the book how there could you can then kind of get the reverse process kind of you can kind
00:36:51of get the whole thing to you know kind of the spring to expand which is of a few brave people start to speak up than a lot of other people who have had that sicker believe all of a sudden release on a loan and then you start a
00:36:59cascade right in which a lot of people start to speak up and you busy models in the book like that's a revolution come from its resume I can explain it's like an explanation for the fall of the Berlin Wall as an explanation for you know for for political
00:37:10revolution it so happens to be I think highly relevant to what's happening both the left and the right in the U. S. like right now like I think it's as you read the book you just like okay that's the cleanest explanation of the trump when I when I've
00:37:21ever seen when for the more it's also the cleanest explanation the Bernie phenomenon I've ever seen like I think I see discuss both quite accurately for the last question I'd like to return to mark in band is a couple and what's mark's biggest misconception about you and mark
00:37:34what's spends biggest misconception about you said this is the sad thing is that he knows me so well that I wish he had missed for that but like he actually knows who I am and so this is the M. A. manifests itself the worst like a something's going
00:37:51wrong at the firm it's always some combination has in my fault %HESITATION and he'll know exactly the flaws that I have that have led us to that situation and wife it's unbearable and and you know and vice versa but I'll let him answer and market you have the
00:38:07last word there's biggest misconception of me as he thinks I'm gonna go to my room tonight listenable Smith I thank you both very much for this dialogue they're very

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