Dec 5, 2013 · 28m · mad
Joe Lonsdale, Formation 8 // Fireside Chat at Data Driven NYC #20 (Hosted by FirstMark Capital)
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this fireside chat at Data Driven NYC #20 hosted by FirstMark Capital, Palantir and Addepar co-founder Joe Lonsdale discusses his entrepreneurial journey, the engineering principles driving his enterprise data platforms, and his investment thesis on the 'Smart Enterprise' software wave at Formation 8.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Matt holds 19.4% of the talking time here. How this is scored →
Matt as informed peer 1.8 Guest teaching 2.9 Guest disagreement 0.9 Matt pushing back 0.8
speaking balance: gold is Matt, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 27:34 Refuting audience premise on lavish marketing
Joe directly pushes back against an audience member's assertion that Palantir spent excessively on parties and marketing early on, insisting that marketing without substance is dangerous.
Hardest push from Matt ▶ 1:30 Host steering guest focusMatt politely but firmly refuses Joe's suggestion to dive straight into company background, redirecting him to stick to his personal career trajectory first.
Biggest teaching moment ▶ 5:22 Correction on largest VC fund claimWhen Matt asks if Formation 8 is the largest first-time VC fund, Joe immediately corrects the host by pointing out that 1999 funds were larger.
Matt holds his own ▶ 21:55 Sharpening the network effect mechanismMatt demonstrates industry knowledge by pressing Joe to clarify whether his enterprise network effect thesis relies on internal organizational workflow or external data sharing.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Matt as informed peer | Guest teaching | Guest disagreement | Matt pushing back | Why |
|---|---|---|---|---|---|---|
| Joe Lonsdale's Background and PayPal Origins | 1 | 3 | 1 | 2 | Matt introduces Joe and asks for his personal background story. When Joe asks whether he should cover company details first, Matt gently redirects him to focus strictly on his personal career arc before Joe details early PayPal fraud detection. | |
| Foundations of Addepar and Formation 8 | 2 | 5 | 1 | 1 | Matt asks if Formation 8 is the largest first-time VC fund, and Joe corrects him by pointing out funds in 1999 were larger. Joe then educates the room on Palantir's dynamic ontology and technical architecture. | |
| Enterprise Sales and Palantir's Growth Strategy | 3 | 4 | 1 | 1 | Matt asks sharp questions regarding enterprise ROI, customer acquisition, and pilot expansion in conservative industries like Wall Street and government. Joe shares insights into enterprise sales dynamics and navigating internal threat responses. | |
| Addepar's Financial Data Integration and Engineering Culture | 2 | 2 | 1 | 1 | Matt probes into Addepar's data challenges and team building strategy. Joe explains the messy reality of financial custodian data and the importance of having co-founders who push back on bad ideas. | |
| Formation 8 Thesis: The Smart Enterprise Wave | 3 | 3 | 0 | 1 | Joe details the Smart Enterprise wave and enterprise network effects. Matt asks a pointed clarifying question distinguishing whether network effects stem from internal organizational knowledge or cross-entity data sharing. | |
| Workflow Replacement and Investment Highlights | 2 | 2 | 0 | 0 | Matt asks about specific data workflow investments and opens the floor to audience Q&A. An audience member asks about government data sovereignty laws, which Joe answers collaboratively. | |
| Audience Q&A: Palantir Marketing and Fireside Chat Wrap-Up | 1 | 4 | 3 | 0 | An audience member questions Palantir's early heavy marketing and lavish parties relative to its size. Joe rejects the premise, clarifying that they did almost no marketing for five years and explaining that substance must precede noise. | |
| Fireside Chat Conclusion and Stage Transition | 0 | 0 | 0 | 0 | Matt briefly thanks Joe and transitions the stage to the upcoming presenters. |
Statements from this episode (20)
Lonsdale: PayPal alumni have started about 17 successful companies
“I guess there's like 17 or so companies now that my colleagues have started that have done quite well out of PayPal.”
Lonsdale: Combining AI with human investigators cut PayPal fraud by 90%
“We had, like, a 120 investigators using technology, ah, to see what was going on, along with the AI. And that combination cut down the fall by 90%”
Joe Lonsdale: Commercial business makes up about half of Palantir
“I started the finance side of Palantir, which became the commercial side, which is about half of Palantir's business now”
Joe Lonsdale: $20B spent annually on wealth management technology
“There's about twenty billion dollars a year spent on private wealth management technology,”
Lonsdale: Palantir has roughly 1,500 employees across 18 global offices
“Palantir has about, I guess, 1500 people and 18 offices around the world. It's like half in global defense of about 18 countries, I guess where it's working in defense and intelligence, and it's working about half in finance and other commercial areas now.”
Lonsdale: US government spends $45B annually gathering intelligence data
“The government, for example, spends, like, I think, forty-five billion dollars a year now gathering data for intelligence and defense purposes.”
Lonsdale: Enterprise startups need older leaders for institutional sales
“You do have to include like older people probably for these institutional sales and who actually have a big role in the company. Otherwise they don't take you seriously.”
Lonsdale: Enterprise startups cannot win giant contracts immediately
“You can never really get the giant contract at first. Whenever you're starting these companies, you, like, get really excited because there's, like, this, like, big contract you're going after, and in my experience, that never happens. It's always, like, a lit…”
Lonsdale: Startups must be an order of magnitude better than IBM
“It has to be something that they desperately need, and it has to be an order of magnitude better if you're a small company. You can't just come in and have a slightly better solution than IBM and then somehow win an RFP. It just, it never works.”
Lonsdale: Palantir won a $100M contract replacing a $500M banking system
“We eventually were able to get, get past that and, you know, charge a hundred million dollars for something that would have cost five hundred million dollars, and that, but that was like multiple years into it before you can get contracts that size.”
Lonsdale: Building Addepar's core platform took three years and 30-40 engineers
“I thought this was going to be actually relatively easy after the Palantir stuff. It turns out it took us about three years with a team of, like, you know, 30 or 40 really talented, you know, product engineer people to get, like, the basic systems to work at t…”
Lonsdale avoids poaching Palantir talent until the company's growth slows
“I, I'm not poaching from Palantir yet. I always told Palantir, if they stop growing really quickly, I'm going to take their best guys, but I can't do that yet.”
Lonsdale: 80% of top tech talent comes from 20 universities
“Yeah, I think there's like, 20 top tech schools that were like, 80% of the talent comes from,”
Lonsdale: Palantir replaced a 1979 legacy system at a bank
“When Palantir went into one of the banks, we actually replaced one system from 1979.”
Lonsdale: Over 1,000 partners are building on Palantir's platform
“I think there's over a thousand partners now, actually, building on top of Palance here”
Joe Lonsdale: The best data startups replace existing, budgeted enterprise workflows
“The data companies I tend to be most excited about, Are the ones that are focused on, I guess, focused on, like, replacing a specific workflow. So it's like, there's something that people are already doing in industry and are already budgeted towards, or that …”
Lonsdale: Palantir built internal clouds in 2005 for government requirements
“Palantir in 2005 had to create the concept of an internal cloud because basically that's the only way to make it work for governments because they're not willing to use the external clouds.”
Lonsdale: Tel Aviv and Seoul are top international tech innovation hubs
“If you're gonna go outside of the U.S., I think probably Tel Aviv and Seoul are the two strongest innovative areas in my opinion from what I've seen.”