The Exchanges, every show

Q What makes you think that people will actually implement a law like that? Or are there other rules that you see on the horizon based on your experiences with companies, with lawyers who are pushing back against some of this new technology?

A The fear when any technology comes out is huge, and it doesn't help that people like me are stirring things up. And fear creates action on behalf of governments and big companies, and so that's very worrying. The good news is that there are a lot of things in the law. We have over a hundred years of law to deal with that. If you jump through the right hoop and follow the correct processes, you can get results. Like one thing we automate is, um, credit report disputes. And they say that if you, um, submit a correct letter and it's signed in the correct way and all of this stuff, you can dispute something on a credit report. And this allows us to kind of get old or inaccurate items off people's reports. And even if it's coming from AI and we have to tell the big company that this was written by AI, it's not going to be influenced. They still have to respond to that letter. And so there's all these rights that people have, and I don't think that they can strip them all away with one law, but it is worrying about where, where the kind of Congress is heading.

AI assessment note: “fear creates action on behalf of governments and big companies, and so that's very worrying.”

Q time, I feel like DoNotPay has done an excellent job of kind of keeping up with the times, and so something I saw you build recently is the ChatGPT extension. Which you can basically understand the terms and conditions of a website more effectively. So how are you thinking about the gaps that still exist for consumers and maybe what other opportunities there are to give consumers their rights back?

A When new technology comes out, we think, how can it help people? And terms and conditions is a great example because people can't understand the changes being made, what they're giving up. So this is actually our first public product relating to true AI. Where you can paste in any terms and conditions, upload a document, including leases, and it will go through and tell you all the things that are non-standard and also things you should watch out for. And that's really important because people don't have time to read a hundred page document, um, which is what are some of the, some of these leases are, especially in New York. And so that can be really helpful. Really, we're trying to be like David and David versus Goliath. So the AI can turn David into Goliath versus Goliath. And, and help ordinary people.

AI assessment note: “Really, we're trying to be like David and David versus Goliath.”

Q Technology companies that will like help you write a will or like help manage your estate planning, things like that. But it doesn't really feel like there's been a company that has tackled this with the scope also that Do Not Pay is addressing. And so has there been a fundamental technology shift or what is enabling Do Not Pay to really tackle this in the way that it is?

A When I started Do Not Pay, Andreessen Horowitz was, was my first pre-seed investor. And I made a deal with them, which is I don't have to drop out of school. I can stay at Stanford and they would invest. And I had other offers, but I decided to go with them because they gave me that deal. And that allowed me to really take time to develop the right strategy. And with any idea, it seems obvious that something like do not pay should exist. Why haven't people done it before? And why aren't people doing it now? And the reason that I developed by taking it slightly slower at the beginning was that do not pay is only successful because it's a horizontal company that Average person, unless you're a bad driver like me, only gets a parking ticket once a year. And so you can't be able to build a real company around that. And so because we've gone horizontal and done all of these use cases over time, it's allowed us to build a retentive customer base, which makes it a successful company. But that's taken seven years and I see Do Not Pay as my life's work. So I think it was this unique insight about being horizontal, plus the effort of seven years to actually kind of build it out that has allowed us to be unique. And there are companies like even offered by lawyers that allow you to get out of your tickets, but there's no one trying to tackle all of consumer rights with the tools necessary…

AI assessment note: “it was this unique insight about being horizontal, plus the effort of seven years”

Q And what is it you see in the best in those periods?

A So, I've made so many mistakes with Do Not Pay. 10 years, I'm 10 years in now. I can give them a crash course so they don't make the same mistakes as me in a matter of three weeks. And bear in mind these are Very young college first time founders. So they don't even know the difference between pre-money and post-money valuation and all of this. So it's almost like a one person accelerator. It's, it's one person, one partner at the accelerator, me, and then one, one founder or one company. Um, and you mentioned Four Seasons. Um, I would say it's not that luxurious. It's adjacent to the Four Seasons. It's technically a Four Seasons residence, but sometimes if there's four co-founders, it's Four beds in one room, so I'll rent beds for 50 dollars a night, and then they all, um, one company, they live in one room, and I say to them, it's like, it's in California, so it's like Hotel California, where you can't check out until you've raised your institutional seed, and then I, the company is off life support, and I can, like, relax a bit.

AI assessment note: “I can give them a crash course so they don't make the same mistakes”

Q I heard from some of the founders that you will house them in a Four Seasons residence. Can you talk to me about this and how you structure that environment that you put them in?

A I noticed over the years, so I've, I've tried all sorts of investments over the years, and things have done very well, but the best sort of investments are the day one investments for me, and I think everyone is playing different games. Um, some people are playing the games where they're getting into the hottest companies, a hundred million valuation, and then they become worth 25,000,000,001 day. Um, the game I'm playing is, um, I'm getting into founders who, when they're just starting, they're not polished at all, and they can really use my advice and my Reliving my founder journey to polish them. And, um, I try and get in sub five million valuation. And the question I'm sure you have is, how do you account for the adverse selection of getting in at those low valuations? And I noticed that over the years, the best founders that I invested in, I actually lived with them at some point. Um, I was roommates, uh, with, uh, the founder of a company called Assured, um, where we both rented the house where Facebook was started over the summer at Stanford. Um, I was roommates with the founder of a company called Yuzu where, um, he worked at Do Not Pay, so he lived at the Do Not Pay house. The founder of Micro One lived in my spare bedroom when I was his first investor.

AI assessment note: “the best founders that I invested in, I actually lived with them at some point”

Q What makes you think that people will actually implement a law like that? Or are there other rules that you see on the horizon based on your experiences with companies, with lawyers who are pushing back against some of this new technology?

A The fear when any technology comes out is huge, and it doesn't help that people like me are stirring things up. And fear creates action on behalf of governments and big companies, and so that's very worrying. The good news is that there are a lot of things in the law. We have over a hundred years of law to deal with that. If you jump through the right hoop and follow the correct processes, you can get results. Like one thing we automate is, um, credit report disputes. And they say that if you, um, submit a correct letter and it's signed in the correct way and all of this stuff, you can dispute something on a credit report. And this allows us to kind of get old or inaccurate items off people's reports. And even if it's coming from AI and we have to tell the big company that this was written by AI, it's not going to be influenced. They still have to respond to that letter. And so there's all these rights that people have, and I don't think that they can strip them all away with one law, but it is worrying about where, where the kind of Congress is heading.

AI assessment note: “fear creates action on behalf of governments and big companies, and so that's very worrying.”

Q And what is it you see in the best in those periods?

A So, I've made so many mistakes with Do Not Pay. 10 years, I'm 10 years in now. I can give them a crash course so they don't make the same mistakes as me in a matter of three weeks. And bear in mind these are Very young college first time founders. So they don't even know the difference between pre-money and post-money valuation and all of this. So it's almost like a one person accelerator. It's, it's one person, one partner at the accelerator, me, and then one, one founder or one company. Um, and you mentioned Four Seasons. Um, I would say it's not that luxurious. It's adjacent to the Four Seasons. It's technically a Four Seasons residence, but sometimes if there's four co-founders, it's Four beds in one room, so I'll rent beds for 50 dollars a night, and then they all, um, one company, they live in one room, and I say to them, it's like, it's in California, so it's like Hotel California, where you can't check out until you've raised your institutional seed, and then I, the company is off life support, and I can, like, relax a bit.

AI assessment note: “I've made so many mistakes with Do Not Pay... I can give them a crash course”

Q What do you find is the biggest problem with the framing that founders often come in with?

A I tell every founder I invest in, um, don't have too high of expectations. Um, you should, I mean, this is classic VC advice. Pitching VCs is like a game of poker. You should never reveal too much information about what you're seeking. So every founder I invest in, I say, don't reveal the price that you want. Um, the price is a function of how hot the deal is, which ironically is less hot if you go in swinging for the fences with something too high. Secondly, I try and relive my story, and I say, you have to do a demo. Um, and I, um, actually, there's a famous story of, I gave this founder advice to do a demo. He's a biotech founder, and he even, like, did a demo, like, a very personal demo, and that, that got a top tier. Everyone was passing on him, and then he did this demo, and then a top tier person came in. So I definitely do the demo. Make it all about them. Also, I think the, I mean, there's a million things, like the CEO should be doing it, not like five founders speaking over each other. There's like a whole list. I, I send it to any founder I invest in.

AI assessment note: “Pitching VCs is like a game of poker. You should never reveal too much”