The Exchanges

Q Okay, so the thing I want to get into you guys, um, About, ah, or spend a lot of time on is the history of the valley. One interesting place to start might be, can you tell when you're in a bubble?

A So my experience is no, ah, and, and, and, and the nuance that I would put on that, ah, I'll describe two. The nuance that number one is there's, there's an old line with respect to economists, economists that also applies, I think, to investors and entrepreneurs, which is economists have predicted nine of the last two bubbles, ah, or, or nine of the last two crashes. Um, and so it, it is extremely common. It, it's a difficult question because it's extremely common for people to call a bubble. When they're correct, they will then go around for years claiming that they're the one who called it. What, what you, what you, what you find with those people generally is they were calling it continuously for the, for the, for the, for the, for the, for the years earlier.

AI assessment note: “So my experience is no, ah, and, and, and, and the nuance”

Q Not in specifically, but I'm basically saying, do you make active decisions, or is it like totally formulaic?

A Well, let me tell you how we do it as a firm, and then I'll give it to the individual. How we do it as firm is we try to, we try to make it as mechanical as possible. We're trying to get out of the psychology of whatever's happening at that moment. So you try to, you try to define a process up front. But, but you do want to be, you do want to be discriminating, and so we have a magic box formula. Things like, you know, the quality of the, you know, are the founders still running the company? Quality of the founders, um, you know, are, you know, are they, are they beating their numbers? You know, what's the growth rate? What's the second derivative?

AI assessment note: “we try to make it as mechanical as possible”

Q And how do you think Chris cracked it so early?

A So Chris is just, Chris always, Chris's entire life has been this pursuit of, it's just how, how he thinks. He's just born to do this, and it's, it's been, you know, it's in pursuit. He uses these terms. He uses one term. He says, uh, what nerds do on nights and weekends. Um, is one way to look at it. The second way to look at it is, um, uh, bad, uh, good ideas look like bad ideas. Um, and then his third most recent version of that is like internet cults. Um, it's like, if it, if it has like a thriving subreddit, then like something's going on. It's the other side of the, of the, of the people's negative emotion on this is the things that become movements early. Like, the internet enables movements.

AI assessment note: “He uses one term. He says, uh, what nerds do on nights and weekends.”

Q So does this lead to a political realignment?

A I believe it, I believe it does, yeah. So I, I think this is the big thing. I think Martin Gurry is the guy who has, You know, you guys published his book. I think he, he really nailed it, and I think his, his thesis in his book came out in I, I, I, I think a lot of people said either, wow, he predicted Trump, which, you know, is true to some extent, but that, like, that's not the big thing that he predicted, and then I think his prediction is in some ways so fundamental that it's easy to just kind of take it for granted and say, oh, of course, that's what's gonna happen, but it's like, it's actually so fundamentally important, I can't stop thinking about it, which is basically true transparency, true transparency, true free speech is just, is a fundamental solvent, uh, uh, uh, uh, uh, basically dissolving all centralized institutional authority. Um, and, and the reason for that is centralized institutional authority is never perfect, and, and it often has problems, and in fact, it often has very deep and severe problems, as we were just discussing, um, and the kind of show that a government agency or a big company could put on to claim that they're better than they are, uh, that would have worked under centralized media just simply collapses under conditions of, of, of, of true free, uh, peer-to-peer communication. Like, it just, there, there are just too many examples of too …

AI assessment note: “I believe it, I believe it does, yeah. So I, I think this”

Q Would you agree with those three? And do you think people can pick and choose? Because we can take some of those things without maybe, you know, the lawsuit department or something.

A Yeah, so I, I think that's all right. I would maybe add one more thing, or kind of distill it out of a bunch of these, which is basically, like, truth-seeking at all costs. Um, at least I, I find this to be the case with him, and I think this is really not, people, people, people who are mad at him really don't understand this. He really, really genuinely wants to know ground truth, and he really genuinely does not want to know anything that's not ground truth. Um, and, and again, it goes back to our thing of, like, how to confront bad news, like, or bad, like, he, he's absolutely ruthless and relentless in making sure that he actually understands what's going on, and I, You would think that that's common, and like, I have not found that to be common at all among people in business. And, and, or you mentioned another, related to another thing, which is, you mentioned the thing where, you know, we're all, like, literally, with Elon, it's, we're all gonna die, you know, if we don't get this, we're all gonna die. Like, every other, typical startup founder, me, when I was doing it, it's always like, you're always trying to come across, you're trying to, you're trying to, you're trying to, you're trying to, you're trying to, you're trying to, you're trying to, you're trying to, you're trying to, you're trying to, you're trying to, you're trying to, you're trying to, you know, Yeah, …

AI assessment note: “Yeah, so I, I think that's all right. I would maybe add one more thing”

Q to, like, step one of founding an internet company was, you know, write a check to Oracle, and then you can do stuff after that, and then the open source databases, um, MySQL and Postgres became competitive in the 2000. Like, you don't like me reasoning by analogy too much here, but like, can you reason by analogy to the database world? Just how does the market structure play out?

A Yeah, no, I think that's right. I think that's right. I think that's a good, that's actually a good comp. Another one is operating systems. So when I, when I, when I was a kid, um, you know, the world's best operating systems were, um, specifically, I mean, Windows is its own trajectory and iOS, but, um, for, uh, for like, what we used to describe as proper computing on real computers, um, like, uh, Unix computers, uh, uh, including supercomputers and workstations and advanced, you know, scientific applications, things like that. Um, you know, the best, the best versions of Unix were proprietary for a very long time. You know, these really big companies like DEC and HP and others that have, yeah, IBM,

AI assessment note: “I think that's right. I think that's a good, that's actually a good comp.”