The Exchanges

Q It is astonishing how time flies, but I just want to go back to a little bit actually in childhood. I believe the best entrepreneurs Are shaped early. When you think about your childhood, how would your parents and teachers have described the young Mario?

A They would say, I always had a high degree of totally intrinsic motivation, and just not really caring what others told me to do, or what others thought about what I was doing, and so, um, I got a Sinclair ZX-Eighty-One, which had, I think, one kilobyte of RAM relatively early on, from not my parents, my father's a middle school teacher, mother's a nurse, and so they had really no Mathematical or computer science inclinations whatsoever, but a friend of my father gave me that little computer and so I would type in listings and learn all that stuff and just get sucked into that and do whatever I wanted there really. I don't think I was always that smart in going about and learning it. I remember actually a summer where I kept trying to figure out how to have the computer draw lines and I would just on, you know, square paper draw lots and lots and lots of lines and see how would you have to place the pixels to draw a line. And, um, the guys who invented doom, for example, would have probably figured out a clever algorithm there. I couldn't figure it out. And eventually I realized, okay, floating point numbers, that's the thing you need there, but it took me way too long. Okay. So the persistence and the intrinsic motivation, and then the sort of not caring what others think about it's probably the biggest ingredients.

AI assessment note: “They would say, I always had a high degree of totally intrinsic motivation”

Q I would ask you, is that not your fault, respectfully, for not illustrating that clearly to the public market, to Wall Street, of how you are able to do those things efficiently, given the team stack that you have?

A For sure. I mean, 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. I mean, the story of Oscar and the data we published, if you go back through time, Did not change that dramatically. Um, if it not, it changed dramatically at the EBITDA level for sure, but the underlying figures, you know, the medical loss ratio moved from 86 to 82, whatever, right? That does not seem like an unbelievably massive move. It's a pretty big move in, in healthcare circles, but it wasn't something that was completely out of the question when we were at 86. So clearly, the markets were not understanding or were listening or hearing something we were, I was saying. And here's one learning actually from the public markets about this. And, and funny story recently, Mark Bertolini, the CEO now, he gave a talk at the JPMorgan Healthcare Conference. That's like the Mecca and the Christmas of healthcare investing. You know, it's every first week of January in San Francisco, whatever, um, and everybody gives speeches and gives guidance for the year and all that kind of stuff. And one of our VPs of engineering is a very smart guy, came to me the day after and said, oh, it was great to hear Mark talk. Like, he makes things sound so simple and, and straightforward. And I said to him, Just can you give me some feedback and s…

AI assessment note: “For sure. I mean, an efficient market is not efficient”

Q What is the number one reason why so few have succeeded in healthcare? As we've, we've seen some amazing entrepreneurs, we've seen some bold visions and ideas, seen a lot of cash go in. What's the number one reason in your mind? Why we haven't innovated in such an archaic space?

A I think it's misunderstanding the market dynamics. You very, you have very few market segments in US healthcare where you get paid more for delivering higher quality, uh, because that market isn't being created. You know, the employer market that buys insurance, for example, and has to buy digital health services is not necessarily driven by a deep understanding of if I buy this product, exactly what will I get and how can I beat the price down? Like, when, when Walmart decides how to stock their shelves, they know exactly what to look for and how to get the best price for the best quality. That is not how, there is no such broker, so to speak, um, metaphorically speaking, in the U.S. healthcare system. And so, entrepreneurs don't understand this. They have this simplistic view of, oh, I build a faster and cheaper car and people will come and buy it. That's not how it works in U.S. healthcare. And so, you get this broken market and therefore the wrong approaches. And I, I used to Say that there is, 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.

AI assessment note: “I think it's misunderstanding the market dynamics.”

Q Mario, what are your biggest lessons from moving out of the role of CEO or demoting yourself as you've put it before? What are your biggest lessons from doing that?

A If you do it, you have to do it wholeheartedly. Uh, that, that what blows startups up is, is, um, 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, maybe Mark has a different idea. You can't do that. You have to say, that's a decision for the CEO. You gotta go talk to Mark, you know, and some, sometimes I hate saying that. I'll tell you honestly, um, sometimes I love saying that. I'm like, I'm like, I'm so glad. I don't, I don't have to decide that one anymore. It's an annoying decision, so. Fuck yeah, Mark, go take it on. So that's definitely one important piece of advice.

AI assessment note: “If you do it, you have to do it wholeheartedly.”

Q My question to you is, quoting Jensen Huang again, he broke my heart recently because he said, no, I wouldn't do it all again. Knowing all I know now, no. And my question to you is, knowing all you know now about how Fractured, stressed the U.S. healthcare system is. Would you do something in healthcare again?

A So if I wind the clock back to 2012 when we started, yes. Because at that time, the idea of starting an insurance company as a startup wasn't at all on anybody's radar screen. I mean, Oscar really was the first insurance company startup, and there was no category, insurtech, whatever. That didn't exist. Everybody else came after us. And that aspect I loved the most. I love the fact that people weren't doing it. Again, I didn't have, had no illusion about the fact that I know anything about healthcare operations, anything like that. But I love the fact that other smart people were not trying. That's not the case anymore. Healthcare is not that area. There's plenty of people who are smart, technology oriented, who now have startups, startups in healthcare. But that aspect I, I love back in the days. And so I would today go into an area that has that aspect. Like, what is that? Is that, Agriculture in Kenya. Is that, um, you know, quantum computing in Iceland? Um, is that, uh, I don't know, you know, drugs in space or whatever. Uh, it needs to be something that is just not on people's radar screen.

AI assessment note: “So I would today go into an area that has that aspect.”

Q What is the number one reason why so few have succeeded in healthcare? As we've, we've seen some amazing entrepreneurs, we've seen some bold visions and ideas, seen a lot of cash go in. What's the number one reason in your mind? Why we haven't innovated in such an archaic space?

A I think it's misunderstanding the market dynamics. You very, you have very few market segments in US healthcare where you get paid more for delivering higher quality, uh, because that market isn't being created. You know, the employer market that buys insurance, for example, and has to buy digital health services is not necessarily driven by a deep understanding of if I buy this product, exactly what will I get and how can I beat the price down? Like, when, when Walmart decides how to stock their shelves, they know exactly what to look for and how to get the best price for the best quality. That is not how, there is no such broker, so to speak, um, metaphorically speaking, in the U.S. healthcare system. And so, entrepreneurs don't understand this. They have this simplistic view of, oh, I build a faster and cheaper car and people will come and buy it. That's not how it works in U.S. healthcare. And so, you get this broken market and therefore the wrong approaches. And I, I used to Say that there is, 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.

AI assessment note: “I think it's misunderstanding the market dynamics.”

Q Mario, what are your biggest lessons from moving out of the role of CEO or demoting yourself as you've put it before? What are your biggest lessons from doing that?

A If you do it, you have to do it wholeheartedly. Uh, that, that what blows startups up is, is, um, 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, maybe Mark has a different idea. You can't do that. You have to say, that's a decision for the CEO. You gotta go talk to Mark, you know, and some, sometimes I hate saying that. I'll tell you honestly, um, sometimes I love saying that. I'm like, I'm like, I'm so glad. I don't, I don't have to decide that one anymore. It's an annoying decision, so. Fuck yeah, Mark, go take it on. So that's definitely one important piece of advice.

AI assessment note: “If you do it, you have to do it wholeheartedly.”

Q or a B to B procurement company in Germany, or, and then he goes, oh, I'm reinventing the chip, or I'm investing in the next generation of LLM, or I, And I'm like, I said to him the other night, do you not ever see how fucked up this is? Like I'm being B to B procurement and property management and you're doing redesigning chips and sending things into space.

A You should make sure to be nice to him and give him a good tip when he serves you coffee in, in 10 years from now. So, uh, they, you know, that's a high risk game obviously. Now I'm, I'm, I'm more with you there as well. I think this is a, again, to go into a territory that I understand very well, US healthcare. That is one of the issues in U.S. healthcare. 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. Um, 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, their forty-year-old COBOL codebase With what you just said, um, just a good startup that makes money early on, I think is a huge opportunity. And by the way, these guys who invent the cool chips, they got to sell those chips and that compute to somebody. And I think that then that'll be your companies will buy that.

AI assessment note: “pedestrian, simple workflows and ideas where some amount of companies make a ton of money”

Q My question to you is, quoting Jensen Huang again, he broke my heart recently because he said, no, I wouldn't do it all again. Knowing all I know now, no. And my question to you is, knowing all you know now about how Fractured, stressed the U.S. healthcare system is. Would you do something in healthcare again?

A So if I wind the clock back to 2012 when we started, yes. Because at that time, the idea of starting an insurance company as a startup wasn't at all on anybody's radar screen. I mean, Oscar really was the first insurance company startup, and there was no category, insurtech, whatever. That didn't exist. Everybody else came after us. And that aspect I loved the most. I love the fact that people weren't doing it. Again, I didn't have, had no illusion about the fact that I know anything about healthcare operations, anything like that. But I love the fact that other smart people were not trying. That's not the case anymore. Healthcare is not that area. There's plenty of people who are smart, technology oriented, who now have startups, startups in healthcare. But that aspect I, I love back in the days. And so I would today go into an area that has that aspect. Like, what is that? Is that, Agriculture in Kenya. Is that, um, you know, quantum computing in Iceland? Um, is that, uh, I don't know, you know, drugs in space or whatever. Uh, it needs to be something that is just not on people's radar screen.

AI assessment note: “So if I wind the clock back to 2012 when we started, yes.”

Q I mean, but who, but who's counting? I mean, much, you know, it could be worse, could be 95, right? Um, could you just help me understand, why did it tank so bad? I don't understand.

A Um, I would say actually two things. Okay, the simpler one is people thought we're running out of money, and that begets discount on the stock price, and then you have this sort of vicious circle that spins you down. Because, um, analysts write reports that say, Oscar will be out of money in twenty-twenty-three, twenty-twenty-two, whatever else. You have to discount, you have to start discounting the fact that we have to raise money again. The stock price goes down. Oh, and then the dilution would get bigger on that raise you need, and boom, you circle down, you circle the drain. Um, that's the biggest reason people didn't think we'd get to profitability in time. Very, very simple. The more complicated reason is the following. That people didn't know anymore which business models were real. And whether there was any connection between the thing you said you're disrupting and you're doing, and the actual way your business model was working. And that, I think, is still very much an issue everywhere in, certainly in digital health, but also in, I know, fintech and in other markets as well. Is it really the case that some fintech startup bank is attracting members more cheaply than JP Morgan is? Maybe the first million members or whatever, because they happen to be in the local town that they were in or whatever, there's like a small segment. But once you scale, is that still the c…

AI assessment note: “the simpler one is people thought we're running out of money”

Q kind of the bag of tricks earlier for the team and being able to lead them. You said to me before, you might as well build organizations the way you like it, not the way that a book or advisor tells you. I just want to throw that one out there and be like, what did you mean by that? Where does that come from? Can you just explain that?

A There's a stage every founder goes to where the board tells them now you got to bring in professional people. Uh, and then you go and hire a, like a recruiting firm and you find the first CFO and COO and whatever else. And, and some, you know, I wouldn't miss any of the people we had on those roads. They were all, they're still great friends. Every single one of them. And so we have great relationships. Uh, but what then happens inevitably is that those people will bring in management systems that have worked for them. And they will tell, they will make you as the founder and CEO feel That it's time to grow up, dudes, you know, like, just don't be in every meeting and, and not whatever, like, let us handle this one and let's, and you do that and so on. And that is, is, that can be a good thing. I mean, you should certainly always learn from other, other people as to how they do things. For example, I am so surprised, like podcasts, for example, don't ask more the very simple question of what is your weekly meeting? Like, how do you meet with your management team? I remember asking, um, the, the COO of Airbnb that, and, and, and she was telling me, uh, oh, we change it all the time, which was very relieving to hear, because they had also gone through the same different iterations of weekly management meeting compositions in the same way we have. And I always thought there must b…

AI assessment note: “Don't just do what the professional managers will tell you to do”

Q How does that change how you lead the company and how, how you think about external perception, your protection from it, so to speak?

A It's uh, forced us to be even more transparent internally than I think most other companies are. When I read that, I don't know, Snapchat or whatever, it doesn't really it, doesn't really announce products in all hands meetings and so on. You know, we are basically opposite of the spectrum. We, if you walk into the office, we have on the wall updated information, for example, about certain aspects of the medical loss ratio. How our medical claims are doing vis-a-vis our premiums we take in, one of the core indicators of insurance companies, which otherwise, if you had a big insurance company, you probably wouldn't see before a quarterly filing from regulators. So we've created a lot more transparency into performance, financial performance, you know, cash levels, and so on, than really probably most other companies would before they're public internally, so our people know. I think to the outside world, it required us to grow a very thick skin and make sure that That we communicate openly and take a very long-term perspective. We happened to do something for the first time. We also happened to do it in a market that itself was a startup market. It's sort of like a very interesting thing where the affordable care market, the market we started in, in of itself as a startup, and in of itself went through the growing pains and continues to do so. Of insurance companies, all lost mo…

AI assessment note: “forced us to be even more transparent internally than I think most other companies are”

Q So I have this theory that 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. Do you agree with that as an investing thesis almost or not?

A I think it is almost unfortunately the case, and I say unfortunately because I hate for the world to be one where you're locked into your own destiny, into your own fate early on. I mean, that, that does not appeal to me as a socialist European, you know, as I know you're a fellow socialist European. I don't know about the socialist part. I think it's a very multivariate problem though, but I don't think necessarily that we know exactly how to break down who's gonna do something incredible based on just one aspect or a measurable test or something like that. I do think there is, um, You know, this dimension of sort of like, um, how much do you care about what others do? How much cognitive capacity do you have? Um, and then how much persistence do you have? Maybe that's the z-axis, you know? If you have people in the, in, in the, there is an efficient frontier somewhere in there, and some, when I went and was in school, for example, they were definitely always, I think one or two people had better grades than I had, and they went on to become theoretical physicists. They didn't start companies, and they never will. And so there is something else in this sort of, Embeddings, dimensionality of what drives performance that is not quite hard, not, not easy to put the finger on.

AI assessment note: “I think it is almost unfortunately the case”

Q had a time probably about a year ago or two years ago where literally just another bit of bad news just broke me even more. And I just didn't feel like I could take another hit in the face. And so when Mario said to Harry, do you really want the hard feedback? My heart screamed no, because I just could not take another hit. Did you ever have that?

A Oh, oh my God. I used to have this issue of when there's an email and I know it's bad, most likely, or there's an Excel table, I know it's bad. You don't want to open it. And I just find ways not to open it. By the way, a good trick is to open it in the presence of other people. It's like, that's like how I got over it eventually. I'm like, if, um, so we used to have this thing, it's actually an Oscar thing. We used to have this thing where, um, uh, I don't want to go too much into the weeds, but the federal government redistributes revenue of insurance companies in the market we are in depending on the risk of the membership base you've attracted. So if Oscar has a younger membership base, Then another insurer in the same states. We have to send money to the other insurance company because, you know, members of Oscar went to the doctor list, and this is called risk adjustments. It's an incredibly clever way to actually get insurance companies neutral in who they want to, who they want to sign up as members. You want to get every member and then manage a member well. It's actually a very well working system now. It didn't work so well early on. Now it works well. But the way it works is that 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…

AI assessment note: “I used to have this issue of when there's an email and I know it's bad”

Q How did you feel? You know, people always say, oh, money doesn't make you happy money. You do actually have a million in cash. How did you feel?

A I, at that time, it wasn't a million yet, by the way. It was, but it was approaching that level, I think. Um, so then, but yeah, it was close enough, like 900,000, something like that. I have a screenshot of the bank account still, of my checking accounts, and that I was in, which clearly made, shows you made me feel great. Uh, I, I think, um, it, it, it makes, it really gives you a feeling of, for sure, of accomplishments. There's no question about it. You're very relieved that that is the case. There's relief as well. That if shit goes to hell now, not everything will be taken from you. Um, but the third thing is you have an instant feeling of holy shit, now it's on. And, and the, the, the level of fall just goes up. Like you're like, okay, now we fuck it up. It's really painful. Now I have the excuses go away. And I do admit, I admire people who have an ability of going through that and then pushing the, I said it before, the pushing the chips back, chips back on the table. This is one reason why I think, um, you know, mathematicians do their best work before the age of 25 or whatever, right? Nobel Prize laureates tend to be I don't know, like, 35 or something like that, and not, like, 70, I mean, they're 75 when they get the thing, but they're 35 and do the work, because you just don't want to venture out into the woods anymore. You know how, you, in some sense, I know how …

AI assessment note: “it really gives you a feeling of, for sure, of accomplishments.”

Q to many events with the biggest CEOs, execs in the world now. You sit at all the tables with the most powerful people. I luckily now sit at them too. And a little bit of me is like, huh, you've got, you've got that house? And you've got that thing? And I always laughed at people who were like, ah, bigger boat. Do you ever have the bigger boat dilemma?

A For me, it's the, it's not the boat at all. I, I like, for example, um, I, you know, with, when we fly with the kids, whatever, we, even when I fly some of myself, I probably still do economy or something like that when plenty of people fly fly with planes nowadays. Um, and it is a very nice, like, putting my backpack on and a pillow, whatever. I just like, like, it reminds me of when I still thought everything was possible. And, and so, and this whole discounting improbabilities in, in some sense. And look, I mean, I, again, it's not a big hardship, right, to fly from, To the, to the west coast on the economy. It's not like that somehow in the trenches of Ukraine. Let's be very clear again here as well. But the thing I, I really, um, am very, uh, the thing where I feel exactly the way you just said is in the influence sides. And this is some, I forgot who said this to me as well, probably, I don't know, Charlie Munger or whatever, but there's always a, there's always a room you're not in. And I'm sure that's still the case, even for Zuckerberg. Like, if Zuckerberg doesn't get invited to, I don't know, the royal wedding, whatever else, he's like, damn it, I wish I was at the royal wedding. Um, and, um, there is just always a thing that you don't get invited to when you don't, somebody who doesn't call you back, and, and by the way, I learned plenty of those things, and that att…

AI assessment note: “the thing where I feel exactly the way you just said is in the influence sides”

Q Can I ask, do you regret going public?

A No, not at all. Not, not at all. I, I think, um, there is nothing better. Um, I mean, this is the famous Winston Churchill quote, right? Nothing better than getting shot at and surviving it. Nothing more exhilarating. And I definitely think that's true. Um, there's nothing better to get kicked in the nuts violently. Um, and at least knowing at some point I will have turned around and I will only immediately get kicked in the butt, you know. Uh, so I'm in the process of turning a hundred degrees. Uh, I still think that is fantastic. I think you get better at this stuff over time and, and some, and so I would not want to miss that period in my life for sure. And frankly also Oscar wouldn't be around having not gone public. It's a very simple thing. We raised a billion and a half dollars in the IPO, um, in the night before, uh, this is still one of my proudest moments, I insisted in the earnings, in the, in the pricing call, and I have a recording of the pricing calls, like, really funny that you see all the bankers, like, say all these things, this will happen, that will happen, none of that which happened, by the way, whatever, and I said, what's the highest amount of money we could go and get from the markets? Probably one reason why the pricing went down on the first trading day, not the only one, um, but we needed all that money. Otherwise we would have had to raise at bad po…

AI assessment note: “No, not at all. Not, not at all.”

Q Um, can I ask, what, can I, pause, pause. What one do you hate to delegate? And which one do you love to delegate? Just as an example.

A I think there's certain ways in which I, Uh, would go about brainstorming strategy or, um, even management tooling in the company. Uh, like who meets at what point in time? What data do we look at? Whatever. Well, I, I've always had, I've always thought about that in a certain way. I, I could never quite get there, but this is like a system in my mind. I would like to see that system be the thing. Um, but Mark is now doing a different way. Uh, that one I don't like giving away. I don't like it. I mean, look, it is, 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, if you're the guy who can tell everybody what to do, and they all have always respect for it, that's a sweet gig. If you don't have that anymore, you feel like a chump. You know, you have dreams at night of, like, not getting, literally not getting invited to the party anymore. Like, that's how it translates almost. That part's more difficult. The part that's easier is Things along the lines of, you got to deliver a tough message to a person. You got to tell this person to shut up and do this now. Um, that was, is always more difficult for me. And so one of the reputations Mark had was to be more of a hard ass. And I, I, I always thought the company needs more of a hard ass. And Mark is not, I would say, s…

AI assessment note: “that one I don't like giving away... The part that's easier is”

Q What thing that money buys or brings do you most value?

A I think it is that sense, um, that I do not have to go do what others tell me to do. I could go, I love, absolutely love, and it is unbelievably ineffective. To just do something that I find intellectually somewhat interesting. Like I learned Mandarin in the last two years, for example, for no reason whatsoever. Now I'm trying to learn how to read Arabic. Um, I think there might be something coming out of it at some point. I built this game over this week, this weekend. I'm hoping to publish it next week or so. It takes like words and puts them into some kind of riddle thing. Also, it's hard to explain. Um, but like I just programmed this myself and it's very ineffective. I should hire somebody to do it, whatever. Um, Uh, but I love doing those things, and I like the idea of being able to do more of those things, and I also think those things have sometimes randomly gotten me somewhere, and you have to put yourself into these, Like, maelstroms of randomness.

AI assessment note: “that sense, um, that I do not have to go do what others tell”

Q How does that change how you lead the company and how, how you think about external perception, your protection from it, so to speak?

A It's uh, forced us to be even more transparent internally than I think most other companies are. When I read that, I don't know, Snapchat or whatever, it doesn't really it, doesn't really announce products in all hands meetings and so on. You know, we are basically opposite of the spectrum. We, if you walk into the office, we have on the wall updated information, for example, about certain aspects of the medical loss ratio. How our medical claims are doing vis-a-vis our premiums we take in, one of the core indicators of insurance companies, which otherwise, if you had a big insurance company, you probably wouldn't see before a quarterly filing from regulators. So we've created a lot more transparency into performance, financial performance, you know, cash levels, and so on, than really probably most other companies would before they're public internally, so our people know. I think to the outside world, it required us to grow a very thick skin and make sure that That we communicate openly and take a very long-term perspective. We happened to do something for the first time. We also happened to do it in a market that itself was a startup market. It's sort of like a very interesting thing where the affordable care market, the market we started in, in of itself as a startup, and in of itself went through the growing pains and continues to do so. Of insurance companies, all lost mo…

AI assessment note: “It's uh, forced us to be even more transparent internally than I think”

Q Can I ask, do you regret going public?

A No, not at all. Not, not at all. I, I think, um, there is nothing better. Um, I mean, this is the famous Winston Churchill quote, right? Nothing better than getting shot at and surviving it. Nothing more exhilarating. And I definitely think that's true. Um, there's nothing better to get kicked in the nuts violently. Um, and at least knowing at some point I will have turned around and I will only immediately get kicked in the butt, you know. Uh, so I'm in the process of turning a hundred degrees. Uh, I still think that is fantastic. I think you get better at this stuff over time and, and some, and so I would not want to miss that period in my life for sure. And frankly also Oscar wouldn't be around having not gone public. It's a very simple thing. We raised a billion and a half dollars in the IPO, um, in the night before, uh, this is still one of my proudest moments, I insisted in the earnings, in the, in the pricing call, and I have a recording of the pricing calls, like, really funny that you see all the bankers, like, say all these things, this will happen, that will happen, none of that which happened, by the way, whatever, and I said, what's the highest amount of money we could go and get from the markets? Probably one reason why the pricing went down on the first trading day, not the only one, um, but we needed all that money. Otherwise we would have had to raise at bad po…

AI assessment note: “No, not at all. Not, not at all.”

Q I would ask you, is that not your fault, respectfully, for not illustrating that clearly to the public market, to Wall Street, of how you are able to do those things efficiently, given the team stack that you have?

A For sure. I mean, 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. I mean, the story of Oscar and the data we published, if you go back through time, Did not change that dramatically. Um, if it not, it changed dramatically at the EBITDA level for sure, but the underlying figures, you know, the medical loss ratio moved from 86 to 82, whatever, right? That does not seem like an unbelievably massive move. It's a pretty big move in, in healthcare circles, but it wasn't something that was completely out of the question when we were at 86. So clearly, the markets were not understanding or were listening or hearing something we were, I was saying. And here's one learning actually from the public markets about this. And, and funny story recently, Mark Bertolini, the CEO now, he gave a talk at the JPMorgan Healthcare Conference. That's like the Mecca and the Christmas of healthcare investing. You know, it's every first week of January in San Francisco, whatever, um, and everybody gives speeches and gives guidance for the year and all that kind of stuff. And one of our VPs of engineering is a very smart guy, came to me the day after and said, oh, it was great to hear Mark talk. Like, he makes things sound so simple and, and straightforward. And I said to him, Just can you give me some feedback and s…

AI assessment note: “For sure. I mean, an efficient market is not efficient”

Q What thing that money buys or brings do you most value?

A I think it is that sense, um, that I do not have to go do what others tell me to do. I could go, I love, absolutely love, and it is unbelievably ineffective. To just do something that I find intellectually somewhat interesting. Like I learned Mandarin in the last two years, for example, for no reason whatsoever. Now I'm trying to learn how to read Arabic. Um, I think there might be something coming out of it at some point. I built this game over this week, this weekend. I'm hoping to publish it next week or so. It takes like words and puts them into some kind of riddle thing. Also, it's hard to explain. Um, but like I just programmed this myself and it's very ineffective. I should hire somebody to do it, whatever. Um, Uh, but I love doing those things, and I like the idea of being able to do more of those things, and I also think those things have sometimes randomly gotten me somewhere, and you have to put yourself into these, Like, maelstroms of randomness.

AI assessment note: “that sense, um, that I do not have to go do what others tell me to do”

Q Did you talk to someone? Like who was your source of strength?

A And I never had a psychologist before, a psychiatrist, but then I, I was able to get somebody through my, my executive, I had an executive coach, who's a fantastic guy, Jeff Hunter from Bridgewater, and he referred me to somebody. And, um, you know, he said at the time that there were other founders in New York, he was also coaching and, you know, we sort of had a, almost a community of those folks who all were beaten up at various points in time. But Oscar was down before everybody else was down. That period of 21, when crypto was still riding high, when companies were still going public, like DoorDash came after us, for example, they were all still, Going up and doubling on the first day. So there's a time when it was very, a very lonely stock down and that psychiatrist was helpful. Um, but frankly, um, the chemistry helps. I mean, I really thought I took a thing called sertraline. Um, that was a unique way to, to, to do this thing. It was very, I, I do this thing where I track my, my, my moods. So I do this thing. I started doing this in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, in, Um, what, when do I start doing something when I stop doing it? So, like, I would now say, um, 11 o'clock, you know, from whatever, twelve-thirty, like, Harry and Mario talk, and I put the name of the person who I talked t…

AI assessment note: “I had an executive coach... Jeff Hunter from Bridgewater, and he referred me to somebody”

Q I love that. Penultimate one. I love Josh. You've mentioned Josh a couple of times. What's your biggest takeaway from working with Josh now for 12 years?

A Josh and I started our first company together in 2006, so it goes way back before Oscar. Yeah, it was, that was this, that was the thing that later became a gaming company. But, um, but it wasn't a gaming campaign at that time. It was, it was a social network, and none of us was doing it full-time. We're doing it full-time for a while, and then not anymore. And between the years, 2007 and 2000 10, I think, he and I didn't talk. We hated each other. Because, I wouldn't say that strongly, but we had just had, like, we had fight over equity, and, and I thought, he's a young kid, doesn't know what he's doing. Um, and he was arrogant about it, and whatever. Um, and so, and like, why the fuck? I'm doing the programming. What is he doing? That's pointless. You know, all that stuff. And you, we needed to get that out of the way. And I think my takeaway there, therefore, is Josh is an incredibly good person. Uh, very loyal. Um, very smart, obviously. Um, and an incredible guy that's, Knowing what to ask of the right person. But you have to, but he's also the other things. He also has those, you know, he's also a guy you can fight with. And at some point, you have to get it out of the way. If you think he's a saint, if you think he doesn't have those things, you will awaken to it at some point. And so, you might as well get the fighting out of the way at the very beginning. Maybe, maybe …

AI assessment note: “you might as well get the fighting out of the way at the very beginning.”

Q Where do you think companies break? And do you agree with my assessment there?

A One thing I've certainly observed is, um, 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. Uh, so if you tell, if you as the CEO say, look, I have a great idea. I want to have a meeting now. We meet and go through these things, and that's where we're going to get our ideas, and I want to delegate more, and whatever. Your people are going to do the same thing, and the people that they, that report to them will do the same thing. That's how you end up with lots of meetings, lots of spans of control, and fewer people doing the actual work. Um, I think that's the biggest thing. The other thing I would say is, and this is actually a problem I have. If things remain unspoken about how stuff should run. I used to think, so we had the story at Oscar, actually, where I think it was 2014, 2015, so around like two years or so, we didn't have values written down. At that time, it was actually a little bit more rare that companies had values. Now, it's a very common thing, right? Yeah, that's sort of whatever other stuff. Now, also, you're making a very funny face. The funny face might mean, you know, it's like, if you have to say, I'm an ethical company, you're probably not an ethical company, that whole thing.

AI assessment note: “if you try to professionalize management at the top level, everyone below you will try”

Q How did having kids change you as a person?

A It just takes time. And so therefore it gave me more of an appreciation for whatever I do in an hour of a day. It doesn't mean I don't waste A ton of time every single day, and like, I don't know, reading the internet or whatever else, reading Twitter. Um, but it does compress the amount of things you can do in the day in just shorter trunks, because that was a big one. Uh, and I think the other thing is, you cannot imagine going back before you had kids anymore, when you had them. They will always be there, you hope. Um, they will always be the last thing in your life you can, you can go when, I think, Think, feel good about. If you let yourself do it, you can also just be ambitious about them and being a fucking, you know, unhappy person because they didn't go do this, do that, whatever else. But it's like the last thing you did in your life is probably that, and that is comforting.

AI assessment note: “it gave me more of an appreciation for whatever I do in an hour”

Q What do you know now that you wish you'd known when you started Oscar?

A I would go with the Jensen Huang thing, which is, um, you just, the, the, The pain is deep, and the lows are low, and all that stuff, and you just have to, they will, they will be there, and so you just need to basically say, step outside of yourself almost, and observe yourself, and say, you've done this before, it is gonna be fine, and if not, then you can't change it anyway, so, um, so be okay with that. You have a finite amount of time to do this. 10 years sounds like a long time. It's not that long. And so it does matter a lot what you do. Like, I remember there were times when, there were times when I'm like, it's weird. I don't get enough emails today. Should I feel good about this or bad about this? And, uh, oh, um, you know, that's okay. Maybe I can do anything. Like, I think you have to, you have to, it is your job to bring the intensity back in. It just is. And, you know, there's obviously family, there's rest of your life and so on as well. But if you let the intensity go out, I think the intensity goes out, it disappears from the company. And so it's, you have, you don't have that much time, is the other thing I would actually say to myself.

AI assessment note: “you don't have that much time, is the other thing I would actually say”

Q Okay, so if you preserve the right to change your opinion and change the way that one lives, you made a decision to step aside as CEO, take on the CTO role, and then obviously bring in an amazing CEO. Why and what did that decision making process look like, Mario?

A Um, it was, for me, a couple of different things. I think, um, I remember watching the 20 18 World Cup. Which was in Russia and Germany are kicked out in the first round after winning the World Cup in twenty-fourteen. And the coach was Yogi Löw, the same coach who had coached him to be in world champion in twenty-fourteen. And, you know, people know soccer, then you just don't become the world champion. Like, you and I, I don't know about you, but I certainly measure my life in Germany's performance at World Cups. I'm like, oh, that's when they last won. That's when they were next to whatever, you know. It's like such a markers that you just remember. And so, so they win the thing and then they go back to Russia. The guy stays on. And they just get kicked out in the first round in embarrassing fashion. And I thought it was such a great, and then he didn't leave again still, even after that. And of course, they get kicked out of the next tournament as well. And, um, it was such a great example of the guy just lost his, his, like, hat was empty of magic, of rabbits to pull out. He just lost his ability to talk to the team, motivate them, whatever. And I was very concerned about that. I was very concerned about, um, you know, we had the stock price at that, at that time, at the beginning of last year, Mark came in, in April, I think we announced him. Well, March, April, something …

AI assessment note: “He just lost his ability to talk to the team... I was very concerned about that.”

Q had a time probably about a year ago or two years ago where literally just another bit of bad news just broke me even more. And I just didn't feel like I could take another hit in the face. And so when Mario said to Harry, do you really want the hard feedback? My heart screamed no, because I just could not take another hit. Did you ever have that?

A Oh, oh my God. I used to have this issue of when there's an email and I know it's bad, most likely, or there's an Excel table, I know it's bad. You don't want to open it. And I just find ways not to open it. By the way, a good trick is to open it in the presence of other people. It's like, that's like how I got over it eventually. I'm like, if, um, so we used to have this thing, it's actually an Oscar thing. We used to have this thing where, um, uh, I don't want to go too much into the weeds, but the federal government redistributes revenue of insurance companies in the market we are in depending on the risk of the membership base you've attracted. So if Oscar has a younger membership base, Then another insurer in the same states. We have to send money to the other insurance company because, you know, members of Oscar went to the doctor list, and this is called risk adjustments. It's an incredibly clever way to actually get insurance companies neutral in who they want to, who they want to sign up as members. You want to get every member and then manage a member well. It's actually a very well working system now. It didn't work so well early on. Now it works well. But the way it works is that 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…

AI assessment note: “I used to have this issue of when there's an email and I know it's bad”