Apr 5, 2024 · 1h 16m · news
Mario Schlosser: "How to Deal with a 94% Decline in Market Cap" | E1136 · 20VC with Harry Stebbings
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In this candid episode of 20VC, Oscar Health co-founder Mario Schlosser joins Harry Stebbings to share the intense personal and professional realities of navigating a 94% market cap drop, the complexities of disrupting US healthcare, and the transition toward authentic leadership and stepping aside as CEO.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Harry holds 18.9% of the talking time here. How this is scored →
Harry as informed peer 3.0 Guest teaching 1.9 Guest disagreement 1.1 Harry pushing back 2.4
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 56:32 Mario defends value definition
Mario directly rejects Harry's dismissal of company values, defending why specific, non-vanilla operational behaviors must be codified rather than averaged out.
Hardest push from Harry ▶ 54:43 Harry rejects standard corporate valuesHarry forcefully interrupts Mario to dismiss standard corporate values like honesty and fairness as empty, arguing instead for explicit, mercenary work expectations.
Biggest teaching moment ▶ 48:30 Federal risk adjustment explanationMario details the complex mechanics of federal healthcare risk adjustments and hundred-million-dollar swings, teaching Harry about a regulatory system Harry admits he was unaware of.
Harry holds his own ▶ 58:57 Challenging guest's efficiency thesisHarry deftly catches a contradiction in Mario's philosophy, asking how Mario can claim to trust market valuation systems when US healthcare fundamentally misaligns price and quality.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| Opening Title and Highlights | 1 | 0 | 0 | 0 | Harry introduces the episode and asks an easy introductory question about Mario's childhood. Mario reflects on his early intrinsic motivation and computer programming experiments. | |
| The Myth of Early Exceptionalism | 3 | 2 | 2 | 3 | Harry proposes a thesis that top founders always demonstrate early signs of exceptionalism. Mario mildly counters that performance is a complex multivariate problem, citing his low expectations growing up in Germany. | |
| Disruptive Visions vs. Simple Execution in Healthcare | 4 | 4 | 2 | 2 | Harry compares Valley Moonshots with pedestrian European software startups. Mario explains why healthcare innovation fails due to broken market dynamics rather than lack of technology. | |
| Choosing Uncrowded Markets and Low Competition | 5 | 1 | 0 | 2 | Harry presents his 3-part framework for finding attractive startup markets, including low competition and terrible talent brands. Mario enthusiastically validates Harry's framework using Oscar's history. | |
| Deconstructing a 94% Market Cap Decline | 6 | 3 | 3 | 7 | Harry turns the interview aggressive, asking Mario if Oscar's 94 percent market cap drop was his fault for getting lost in details. Mario defends his public market communication while explaining investor fears. | |
| No Regrets: Surviving the Brutality of an IPO | 2 | 1 | 0 | 2 | Harry asks if Mario regrets going public. Mario describes the brutal experience of ringing the bell only to watch the stock fall immediately, requiring prescription antidepressants. | |
| Mental Health and the Reality of Antidepressants for Founders | 3 | 1 | 1 | 1 | Harry shares his own experience on antidepressants, connecting empathetically on founder mental health. Mario explains how he tracked his daily mood on a scale of 1 to 10. | |
| Family and Childhood Comforts as an Emotional Anchor | 2 | 0 | 0 | 0 | Harry asks how Mario balanced marriage and fatherhood while his stock plummeted. Mario notes that returning home and re-anchoring in simple childhood comforts kept him grounded. | |
| Building Resilience Through Repetition | 2 | 1 | 1 | 0 | Mario emphasizes that repetition builds resilience and dismisses Silicon Valley rhetoric of life-and-death stakes compared to actual global conflicts. | |
| Self-Awareness and Finding Your Authentic CEO Style | 4 | 2 | 2 | 5 | Harry asks Mario if he feels like a shitty CEO, challenging his operational management style. Mario argues that CEO advice depends heavily on an individual's personal metabolism. | |
| The Trap of Comparison and Shifting Your Bar | 4 | 2 | 1 | 3 | Harry proposes that comparison and clinging to long-term visions limit potential. Mario agrees, noting how achievement continually shifts one's bar higher. | |
| Stepping Down: Yogi Löw and the Empty Bag of Tricks | 2 | 2 | 0 | 1 | Mario details his decision to step down as CEO, using German soccer manager Yogi Löw as an analogy for running out of magic tricks during a crisis. | |
| Surrendering Authority: Lessons from Stepping Aside | 3 | 1 | 0 | 4 | Harry interrupts to ask specifically what Mario hated delegating versus loved delegating. Mario candidly admits how difficult it is to relinquish top authority. | |
| Discomfort, Polite Feedback, and Coping with Bad News | 2 | 2 | 2 | 1 | Harry admits avoiding hard conversations due to fear of discomfort. Mario counters that leaders are not better at these conversations but rather better at avoiding or manipulating them. | |
| Whiskey Nights: Surviving the Federal Risk-Adjustment Report | 1 | 5 | 0 | 0 | Mario educates Harry on federal risk adjustments in US healthcare, detailing how late-night government reports can swing revenue by 100 million dollars. | |
| Customizing Organization Structure to Your Style | 2 | 2 | 0 | 1 | Harry admits he didn't know about risk adjustments and asks about organizational design. Mario explains why founders should build organizations suited to their own personal strengths. | |
| Scaling Challenges: Layers, Values, and Binary Metrics | 6 | 3 | 4 | 8 | Harry aggressively interrupts Mario to challenge corporate values as meaningless platitudes. Mario defends his view, recounting Oscar's values bazaar and explaining why non-vanilla behaviors matter. | |
| A Personal Philosophy on Money, Value, and Power Law Distributions | 5 | 3 | 3 | 6 | Harry points out a contradiction in Mario trusting societal allocation systems when healthcare is notoriously broken. Mario defends his perspective by discussing power law distributions. | |
| Becoming a Cash Millionaire and Inefficient Intellectual Pursuits | 3 | 1 | 0 | 3 | Harry pushes Mario on when he first became a cash millionaire. Mario shares details of secondary share sales and his passion for un-economic intellectual pursuits like learning Mandarin. | |
| The Attention Economy and the Bigger Boat Dilemma of Influence | 2 | 2 | 2 | 1 | Harry asks about the bigger boat dilemma. Mario rejects material luxury envy but admits to desiring intellectual influence in the attention economy. | |
| Quickfire Round: Legacy, the Compression of Time, and Marriage Secrets | 2 | 1 | 0 | 0 | Harry initiates the quickfire round on time, children, and marriage. Mario shares how having children compresses available time and enriches communication in marriage. | |
| Co-Founder Conflict, Startup Resilience, and Choosing the Tiger Cage | 3 | 2 | 2 | 3 | Harry teases Mario's European mindset when answering a hypothetical tiger vs shark question. Mario reflects on his early 3-year feud with co-founder Josh Kushner. |
Statements from this episode (39)
Mario Schlosser: Oscar Health's stock dropped immediately upon 2021 IPO
“We went public, right, I think it was March third or whatever, twenty-twenty-one. It was Josh and I ringing the bell. And we're like, fuck yeah, this is going to be great. And then we open and the thing falls. It opens low right away and it falls right away.”
Harry Stebbings: Top entrepreneurs always show early signs of exceptionalism
“The best entrepreneurs show early signs of exceptionalism always. It could be in sport. It could be in a business. They start very, very young. It could be in designing websites for local businesses, but there's always a sign of exceptionalism early.”
Mario Schlosser: Performance bars drop in growing organizations without clear benchmarks
“That is absolutely something that happens in the organizations they grow with. That's the bar just And everybody will tell you this just sort of goes, goes down because people do not have a few standout folks or teams to look at and say, okay, that is the bar …”
Mario Schlosser: Grand disruptive healthcare bets have largely failed
“The big ideas and the big disruptive approaches to just changing this Fortune dollar system have not worked all that well for the most part. Nobody's completely reinvented primary care.”
Mario Schlosser: Replacing 40-year-old COBOL healthcare software is a massive opportunity
“There's an incredible amount of very pedestrian, simple workflows and ideas where some amount of companies make a ton of money in U.S. Healthcare and replacing their forty-year-old COBOL codebase With what you just said just a good startup that makes money ear…”
Mario Schlosser: Very few tech startups actually understand how healthcare works
“If you want to draw a Venn diagram of companies or startups in healthcare, you've got the circle of startups with good technology, and you've got a different circle of startups that understand how healthcare actually works, and the overlap is very small.”
Mario Schlosser: Everyone could have an LLM-based doctor by next year
“There's definitely the possibility that we will all have an LLM-based doctor next year.”
Harry Stebbings: Target markets with low competition and terrible talent brands
“I have a simple rubric for exciting business. Low competition. I find it hilarious the amount of people who want to go up against the Collison's or Toby at Shopify. Are you kidding me? You want to, you chose the Collison's as your weak competitor? Terrible. So…”
Mario Schlosser: A 95% drop and 8x rally proves market inefficiency
“An efficient market is not efficient if you go down by 95% and then up by eight X. You know, that's not a hallmark of an efficient market.”
Mario Schlosser: Public markets ignore technical operational details of growth companies
“Public markets don't care about that. They just don't, they have limited attention spans, at least for companies like ours.”
Mario Schlosser: Sell-side analyst price targets provide virtually no predictive value
“At Bridgewater, we always saw that analysts' price targets lag stock market changes. So the market moves first, and then analysts move afterwards, and move prices up and down. You just see this throughout history, ok? There is no, almost no information in anal…”
Mario Schlosser: Oscar Health would not exist today without its IPO
“And frankly also Oscar wouldn't be around having not gone public.”
Mario Schlosser refuses to return to NYSE until Oscar stock recovers
“I'm, I am not going to go until the price is back at the IPO price or I pay my next company.”
Mario Schlosser: Took Sertraline to manage pressure during Oscar's stock crash
“I mean, I really thought I took a thing called sertraline. That was a unique way to do this thing.”
Harry Stebbings: Antidepressants flattened emotional highs and prevented genuine happiness
“Like, I, I've been on antidepressants too. I find, you know, not everything has been easy too. I hated the level all the time. I didn't ever feel happy either. Like, really happy.”
Mario Schlosser: Antidepressants can block deep intuitive insights needed by founders
“That insights, being on the drug might not come to you, and you might end up actually doing the wrong thing because the drug sort of cuts out some of these deeper insights that you should, that should flood into your consciousness.”
Mario Schlosser avoided checking Oscar's stock price during its 94% drop
“I honestly, I did not even look at the stock price. That was one way in which I dealt with it. I didn't look at it.”
Mario Schlosser slams Silicon Valley's life-and-death rhetoric around startup struggles
“Sometimes the rhetoric and Silicon Valley of like, oh my God, life and death, whatever, is also just fucking stupid. Like none of us is, you know, gonna get shot at in the trenches of Ukraine if our stock price goes down.”
Mario Schlosser Admits Weaknesses in Delegation and Operational Management
“I'm certainly bad at some things that I think professional CEOs should be good at. I probably bad at delegation. I'm probably bad at you know, operationally managing people like saying, hey, I told you to do these three things. Did you do those three things ne…”
Mario Schlosser: Generic VC advice fails because leadership depends on individual traits
“I think the explanation is it depends. It depends on the person and the metabolism and the genetic makeup, whatever, of the people who take the advice. And I think that very thing is true for CEO-ship as well.”
Harry Stebbings: Rigid long-term visions artificially limit ambition
“So I think visions are one of the most dangerous things that people can have. And that sounds very strange, but visions often underestimate your true ability.”
Mario Schlosser: Step-down founders blow up startups by undermining new CEOs
“If you do it, you have to do it wholeheartedly. That, that what blows startups up is, is if you say, oh, I'm gonna take a different role now, and then you don't, and people still come to you when you tell them, oh, yeah, I would do this, you know, but whatever…”
Mario Schlosser: Founders who deny struggling after stepping down are lying
“It's difficult to not be the person with the top authority anymore. It just is. I mean, anybody who doesn't tell you that isn't fucking idiots. You know, like, if you're the guy who can tell everybody what to do, and they all have always respect for it, that's…”
Mario Schlosser: Famous leaders are not better at having difficult conversations
“If you think that the people who are famous in this world somehow are good at these things, it's a complete nonsensical thing. In fact, one of the, I think they're good at They're better at avoiding these conversations than we are. You and I are good at maybe …”
Mario Schlosser: Federal risk adjustments previously swung Oscar's revenue by $100M
“In late March, we get the first report from the federal government as to where our risk score landed, and it moves the numbers by a staggering amount, like it used to move the Oscar numbers by, like, you know on a, I don't know, half, on a billion revenues, th…”
Mario Schlosser: Oscar Health forecasts federal risk adjustments within $10,000 accuracy
“We now know how to do this. We now know how to have a really good system that lands within, like, 10,000 dollars or whatever, you know, of the estimate, because we get so much throughout the year or whatever.”
Mario Schlosser: Process high-stakes bad news directly alongside team members
“That is the way to deal with bad news, to just deal with other people for whom it is equally bad, but at least you share the badness in some way.”
Mario Schlosser: Design company structure around personal strengths, not textbooks
“I do think I have an ability of keeping more pieces of information in my mind at the same time than most others. And so design around that as opposed to just sort of reading the book, you know.”
Mario Schlosser: Professionalizing top management creates excessive organizational layers
“One thing I've certainly observed is if you try to professionalize management at the top level, everyone below you will try to do the same thing. And that's how you end up with nine layers, you know, or nine is nice, like, 20 layers. So if you tell, if you as …”
Harry Stebbings: Company values must be polarizing choices people can disagree with
“Company values, you should, I'm sorry, I'm gonna jump in here. You should be for or against them. You know, we, fairness and honesty. If you're not in for these, then obviously you're an immoral person, respectfully. What are you in for? Unfairness and immoral…”
Mario Schlosser: Money is the best available metric for measuring societal impact
“I certainly, by the way, think money is the best way we have to measure societal impacts. It's not perfect by any means but I, and I don't like it necessarily but I absolutely think that, ah, It is, it's not that the wrong, it's always the wrong people who are…”
Mario Schlosser: Becoming a billionaire requires an entitlement mindset bordering on defect
“I've seen the people who make the real amounts of money, the people who become the moguls, they have an incredibly strong sense of what they are owed by society and by the system or by other people that I don't have. And I think it's almost a brain defect. If …”
Mario Schlosser: Power law wealth distributions show talent allocation is imperfect
“IQs are a normal distribution and not a, they're not a power law distribution. So by definition, we know that, you know, whatever top IQ, there's like, you know, there's one percent of them. It's not that there's like three people of them, whatever. So they're…”
Mario Schlosser cashed out $900k in Oscar Health's 2015 secondary round
“I, at that time, it wasn't a million yet, by the way. It was, but it was approaching that level, I think. So then, but yeah, it was close enough, like 900,000, something like that.”
Mario Schlosser: In Silicon Valley, influence matters far more than money
“That attention economy, once you get to the level of, I don't know, Silicon Valley, whatever, well, that, where money is less of the issue, that is much more important, I think. Way more important than money.”
Mario Schlosser: Multi-decade venture timelines strictly limit total lifetime founder bets
“Oscar took 12 years. How many more of those, how many things of that nature could I try to do and try to bite off?”
Mario Schlosser: If a founder loses intensity, the company loses intensity
“If you let the intensity go out, I think the intensity goes out, it disappears from the company.”