39: Andrew Reed - Don't Flinch

[00:00] But it's February 2014 was when the... [00:02] WhatsApp, Facebook deal was announced, and that was like a $4 billion-ish dollar gain for Sequoia. That's the bar. Welcome to the company. Yeah, and it was obviously that was amazing, and then literally, you know, an email goes out saying, you know, meet in the [00:17] We were in this dingy office. It was like Sequoia's longtime office. We'd be in the lobby at noon for like a champagne toast. It's like, oh, champagne toast. It was literally five minutes long. And then everyone goes back to their desk and just keeps working. [00:30] That was an interesting moment. I don't know what to take from it besides Jim Getz is a legend. [00:35] And also that like, yeah, greatness is sort of expected, you know. [00:38] opportunities that you're really excited about reveal themselves highly infrequently and never at opportune times. I grew up around New York City. I had dreams of facing, and I graduated high school in 2008. I remember I read the big short right when it came out, and I had to go, how am I going to react to a crisis in finance? I picture myself on Park Avenue, wheeling and dealing, going to a boardroom, making a deal happen when things were blowing up. And then [01:08] I imagine myself in the moment so many times. [01:11] What it actually looked like was [01:13] I just bought a house. It had a pool outside. There was no furniture in the house. [01:17] We were locked down because of COVID. I was doing circles around my pool, talking to Vlad and Basio about his investment when [01:26] You know, the market was gapping down five points every single day. But Robinhood was like, you know, this is back when you could double your money on Boeing in, you know, 16 minutes. We did a $200 million check right that first week of COVID. You know, the app was down for a whole day. It was chaos and felt so proud that, you know, just.

[01:42] not being scared of that moment, you know, in part because I prepared myself for it for so long. Like, what was... [01:48] What would the guy you want to be do in this moment? [01:51] I think you just can't let yourself down. I think all of us... [01:54] like to imagine how we'll react in these like really high stress, high stakes moments. Yeah, don't flinch to me. It just means like just do the thing you know you should do. Welcome to Dialectic episode 39 with Andrew Reid. Andrew is a growth investor at Sequoia Capital, where he has invested in a number of world changing companies, companies like Robinhood, Figma, Klarna, Phantom, and many others. And he's quietly one of the best growth investors out there. [02:24] about how Andrew invests the founders he works with, what makes them so special, how he thinks about the quantitative and the qualitative side of things, what it's like doing so at a place like Sequoia and how Sequoia's culture of performance and teamwork influences so much of his work. And we also talked about how he brings humanity into a job that on the surface might seem quite quantitative. [02:45] He is a deeply competitive dude and loves to win and is quite good at making money. But he also brings a element of craft and care and taste and attention that, [02:56] really stood out to me as I was preparing for this conversation and certainly [03:01] as I had it. We also talked about Sequoia Capital and some of the legendary people who have come before him and how he has worked with them and learned from them, as well as people he's working with now and who are apprenticing under him. This is certainly a unique and special institution, and it was fun to hear Andrew's perspective on it. I think investing is such an interesting discipline because there are so many different ways to do it and to be good at it. But I think

[03:31] him to pull apart the details and show me how some of the magic is made. I hope you are inspired by his level of deep attention and care and fierce competitiveness that he puts into doing this job so well. And ultimately, as I think he would say, to serve great entrepreneurs trying to change the world. Before we get into the conversation, I'd like to thank Dialectic's presenting partner, Notion. Notion is a collaborative workspace for teams and ultimately a tool for people doing [04:01] the things I love about Notion's approach to AI and to agents is that they are quite attuned to allowing you to focus on the work that deeply matters, allowing you to collaborate with you, you need to, and then delegate the rest of the work to agents and to AI. I found even with Dialectic, whether it be preparing for interviews or on the other side of them, being able to throw all of my ideas or the transcript or whatever else into Notion and have Notion AI pull out [04:31] even find kind of weird corners of research I might not have uncovered. It's just a tremendous amount of leverage. And yet it isn't about automating the part of the work that I really care about, which I think is deeply important. Notion is a brand, as I've talked about in the past, that has imbued craft and care and soul into every piece of it. And I think you can see that whether you're using Notion solo or in a giant team. It's no coincidence that all kinds

[05:01] their worlds and their businesses on Notion. If you don't use Notion, you can check it out at notion.com slash dialectic. And if you use it, I hope you use it to make something really wonderful and full of crafting care. If you do, let me know. Thanks again to Notion for presenting dialectic and thanks to you for listening. With that, here is my conversation with Andrew Reid. [05:21] So, [05:22] All right, Andrew Reid, we're here. Thank you for having me on your podcast. The first timer. It's truly an honor. Breaking my podcast celibacy. Yes, we are going to jump right in. I want to talk a lot about investing, but before we do... [05:35] There are a couple of themes... [05:37] or like little kind of sentences I had about you that I think are worth talking a little bit about before we go into all the work stuff. I think the first is you're someone who is... [05:49] like an elite performer. You are super competitive. You're a growth investor. You started at Goldman. You played high school football and college football. And so there's like a... [05:58] maybe a tinge of like hard on us on, on one end. And yet, [06:03] I think both in your work and personally, there's also like a deep amount of humanity. I'd be curious for you to reflect on how you've leaned into humanity over time, both in your [06:13] in your job as Sequoia and also more broadly. - Yeah, I was, you know, growing up, I think that was a, kind of dichotomy that existed at every point in my life. [06:26] I played... [06:27] I played sports in high school. I also used to do the musical.

[06:32] My best friend in high school was not on the football team. Actually, besides my twin brother, who is my best friend, he was on the football team. [06:42] I've always had this two sides of the brain, like I love playing the piano, and... [06:47] When I started my career at Goldman, I was definitely the... [06:52] behind the spreadsheet with your headphones on late into the night analyst. I was actually the semiconductor analyst on our team on the TMT team back in the day, which was very out of fashion for a long period of time. I wish I actually studied harder back then because it would have been good to know the last few years. [07:08] When I got to Sequoia, similarly, I was very quantitatively bent for probably the first four or five years of my career. [07:17] And... [07:18] I think one thing you learn with startups is your spreadsheet is always so wrong. You know, it's usually wrong in the bad direction. And when you're lucky, it's wrong in the good direction. [07:30] And the biggest difference between when it's wrong and the bad direction and the good direction is the person running the company and the team that they build. So naturally, you know, you learn that, you know, it really is all about the people. [07:42] And obviously like, [07:43] parallel to your [07:44] work life is your personal life and, you know, changed a lot from high school to college to San Francisco to kind of being an adult and kind of growing up around a lot of people here in San Francisco. [07:54] So to introduce like [07:56] new interests and new concepts. And that's reflected both in terms of the things I've done in investing and also just how I spend my time.

[08:03] Maybe a [08:05] sort of orthogonal, but I think also kind of a double click on this, which is... [08:10] Another element of that is that [08:12] a lot of parts of you are like kind of like in central casting, uh, for what you're like a good looking white dude who works in venture capital and worked at Goldman again, kind of same theme football player. And, [08:25] I talked to multiple people who know you. One thing our mutual friend and former colleague, Matt Huang said is like, he's like the football player who's also like a hardcore Redditor. And there's like a, there's clearly a good amount of weird. And so I'm curious how that, and my sense is, is that's part of what makes you, [08:42] You're not... [08:44] sure finance guy. And that's part of what makes you a great venture capitalist is like your nose for this slightly strange or the contrarian. And so I'm curious to how, [08:54] how you think you've maybe to the extent you've gotten weirder or how you've fed that. [08:59] I think going back to my childhood, there's this major... [09:04] Thank you. [09:05] Like my main trauma in life was I grew up with a very bad stutter. And actually when I first interviewed with, [09:12] with Doug Leone. I gave him my resume and he looked at it for [09:17] you know, 20 seconds and he goes, oh, yeah, you went to Amherst. You got this GPA. You play sports like Martin Goldman Sachs or [09:24] 200 people just like you get hired. Why would we go hire you? [09:29] In a very kind of like antagonistic Doug Leon interview way. [09:33] And...

[09:34] I think the two things that... [09:36] really motivated me. First is [09:37] I was having a twin brother and we've competed our whole lives. There's something hard and some competitive drive in me. And, [09:44] I spent basically my entire childhood just [09:47] observing, you know, like it's very hard to jump into conversations and do public speaking and, um, [09:53] Raise your hand in class even. I just spent a really long period of my life just listening. [10:00] It's definitely gave me a lot of empathy for the outsiders. [10:08] people who are in low moments and also people who just don't feel like they fit in totally. [10:11] And then... [10:13] amazingly like in college I did speech therapy from when I was in a kid up through when I graduated from high school in that same summer and I went to college and I stopped doing speech therapy and [10:24] you know, like got laid and then all of a sudden everything gets fixed itself. And, uh, like within six months, I didn't have a starter anymore. And, uh, [10:32] Now, you know, I do host the LP meeting and I go on TV and do these things and like, you [10:38] no one sees that side of me because it's literally like hard to, [10:41] you know, it's like hard to find. [10:44] Um, [10:44] But I think that that element of just like weird really does come from that, you know, like the personal feeling of just sort of. [10:51] I think like watching things, uh, [10:54] And I think when you talk with people who are building companies, a lot of the founders who I worked with, [10:59] are maybe now successful and famous and everything else, but deep inside them is the same thing that was deep inside me.

[11:07] People who meet them for the first time today don't see it, but I feel like I have a... [11:11] Kind of a unique way of like seeing the... [11:14] little kid inside people sometimes. And I think that helps with... [11:20] Just like trust, you know? Yeah. Yeah. [11:22] Yeah, it's interesting how... [11:25] I'm sure it's different for everybody, but becoming the version of yourself you want to be, it doesn't sound like that happened through a lot of striving. Or at the very least, the striving and the speech therapy or whatever. A ton of effort towards that doesn't necessarily... Yeah, well, another thing just in terms of the striving, you mentioned Matt Huang. I feel like [11:43] Uh, [11:45] Um, [11:46] So many points in my career, I've just gotten extraordinarily lucky being surrounded by people who are... [11:52] So good. [11:55] Like my, the person introduced me to Pat Grady, who was my first introduction to Sequoia, was Sarah Guo, who was in my class at Goldman. Sarah and Pat are now married. [12:06] And Sarah's obviously like an extraordinary talent who's has been and will continue to dominate her corner of Silicon Valley. And then I started as a class of two associates at Sequoia. It was me and Matt Huang. And could you imagine like a more talented counterpart to be pushing you every day? Also, like very much a startup guy at the time. Yeah. Like you are not a startup guy. No, no. And that was the. [12:30] Like, I think the... [12:32] Associate class of me and Matt Huang, I hope, is going to go down in history as the greatest bang for your buck associate class ever hired. But we started on the same day, February 18th, 2014. And I remember...

[12:46] reading that for the first time and, you know, [12:49] He was on the growth team at Sequoia, and we do a lot of spreadsheet math and cohorts and things like that. And I had never done an in-person meeting in my life with a founder or had never... [13:00] didn't really have a network in Silicon Valley. And we really leaned on each other for a period of years. [13:05] in a way that was extraordinarily collaborative, and to this day, like... [13:10] There are a small number of people who I genuinely feel like are superior investors than me. And like Matt's one of them. I think Pac Beatty's one of them. And like Pat was my direct manager, you know, for my all my one on ones when I joined Sequoia. [13:23] Matt was the person who sat next to me for five years. Kevin Kelly at Square Heritage, who... [13:30] Joined, I think, six months after that on the heritage side. Same age, like also just an exceptional investor. [13:36] And then obviously being surrounded by my initial death, Gatsukwe, was actually on the same... [13:41] open floor plan on the same desk as Doug Lione. [13:45] It's almost like you could have put... [13:47] an idiot in that situation and they would have found a way to at least make some good investments. Well, you could take it the other way. You could take it as like wild that they threw you to the shark. Yeah. Like it was both. Yeah, no, I think there's a way in which – [14:00] I think this is kind of how we think about developing younger investors at Sequoia, too. [14:05] I think what we lack in... [14:07] structured feedback process, et cetera, which we lack a lot. We more than make up for the culture of really investing in each other, and especially in the next generation.

[14:18] I think some people really like that environment, you know, the sort of having lots of freedom to, you know, like sink or swim. But even if you end up swimming, you're like feel like you're sinking for a long time. You know, you're like struggling to stay on top of the water. [14:32] Well, I think you said somewhere like your second day. [14:36] WhatsApp was acquired or something. Yeah, I was in it. I used to check the dates. I think it was February 19th then, or maybe it was February 20th. But it was February 2014 was when the WhatsApp Facebook deal was announced, and that was, I think, a $4 billion-ish gain for Sequoia. That's the bar. Yeah. Welcome to the company. Yeah, and it was, you know... [14:55] Obviously, that was amazing. And then literally, there was a... [14:59] You know, email goes out saying, you know, meeting the... [15:03] We were in this dingy office. We were [15:05] [redacted address], second floor, building for suite 250. It was like Sequoia's longtime office. [15:12] I'd be in the lobby at noon for a champagne toast. I was like, "Oh, champagne toast." It was literally five minutes long, and then everyone goes back to their desk and just keeps working. [15:24] Uh... [15:26] That was an interesting moment. I don't know what to take from it besides Jim Getz is a legend. [15:31] And also that like, yeah, greatness is sort of expected, you know, and that definitely still feels like this case. [15:38] Thank you. [15:38] Maybe a lead into the last thing I had pulled out before we talked specifically about investing, which is competition. Obviously, it sounds like it starts with Will, your twin brother.

[15:50] It's a lot of competition growing up. I think what I'm interested in, and maybe it goes back to what you're saying about Matt and Pat and maybe Sequoia's culture broadly is like – [15:58] There is... [16:00] this deep competitiveness, [16:02] that I sense you have. You clearly, I don't know how much you like to win, but you do a lot of winning. [16:07] And I think competitiveness can be channeled in really great ways or really unhealthy ways. [16:12] And so I was curious for how you relate to... [16:16] that aspect of it and like what that source of energy, like is it, to what extent it can be good fuel or bad fuel? And then maybe beyond that, [16:24] how competitiveness can still sit right next to positive some outcomes, e.g. you're sort of competitive with Matt and also collaborative or vice versa, or even with Will, who does a very similar job at a different firm. [16:39] Yeah, I try my best to exude California cool. [16:44] I think for anybody who's ever been in a trivia competition with me or any sort of a board game or chess or anything else, like, [16:52] I hate losing. I think my brother actually hates losing worse than I do. Or maybe we hate losing the same, but I've somehow gotten to a point where I can at least pretend like I can deal with it, you know, where he's at a point where he definitely can't pretend. [17:05] And I think what's interesting, I... [17:07] I think there was a period of my life when I definitely felt... [17:11] maybe it was an insecurity or otherwise around like when people did – [17:16] well and I wasn't doing so well, I felt jealous or, you know, sort of like the anxiety that brings –

[17:23] But I think Matt's a really good example of this, where [17:27] Like he is... [17:28] Or like Dylan Field of Figma. Some of the people I met really early in my life who have gone on to just do incredible things. [17:35] Number one, like... [17:36] you knew the entire time that they were incredible people, you know? And number two, they are the same level of, like, good and exceptional and kind and caring and looking after you now as they were when you were nobody's, you know? [17:50] And, [17:51] I think in the Valley, obviously... [17:53] Number one, great people can win, and watching great people win is actually rewarding in its own way. [17:59] Number two, it's decidedly not zero-sum. I think one of the... [18:05] One of the funny moments is when you make an amazing investment gain on a company, it's a growth investor. More often than not, there's some Series A investors making more. So it's like you kind of have to accept that the... [18:16] you know, like, [18:17] The job you've done well is worthy, you know? It doesn't have to be the most money. Yes. Or even multiple, too. You might be making more money, but their multiple is better. Yeah. But it's like, you know, we have a job and our job is, you know, at some level, it's like the fund management business. And if our funds are doing well, then we're doing well. [18:37] And similarly, like, we're not going to be perfect. And we... [18:40] Nobody is more into self-flagellation than Sequoia Capital. Like our off-sites are just like a death march through the sins of the past. And there's good learning in that, you know. [18:52] But I think the right frame of mind is you need to accept that you're going to make some mistakes and just try to get better. If you end up dwelling on your mistakes as an investor, especially in venture where the world's moving so quickly and it's always about the next rock you're turning over, you're going to end up totally stuck.

[19:05] Hmm. [19:06] Let's talk a little bit about investing. [19:10] I think... [19:12] I'm most interested to start with... [19:15] There are lots of ways to be a good investor. I think that's probably what draws so many really smart people to it. Maybe there aren't. [19:22] lots of ways to be a truly great investor, but there are lots of ways to be a good investor. [19:26] I'm curious how you would describe... [19:29] your style, like how you invest and why you think you're good at it. [19:33] - Okay. [19:34] I think it starts from... [19:37] uh, [19:38] a place of like genuine curiosity and excitement about companies. I think I, [19:44] At my heart, I'm a finance person. I love companies. We used to do this thing where we would throw up the numbers of a company on the whiteboard on a Monday morning, and you had to guess which company it was. And that was one of the trivia games that I love dominating. And the world is full of these wonderfully interesting businesses and uncovering some new... [20:04] some new theme or some new founder or some new business that you haven't heard of and it like completes some mosaic that's just some corner of the broader mosaic of how the world actually works like that's such a compelling feeling and and [20:16] I'm consistently still uncovering new things. [20:19] And then obviously the world's changing so quickly. New things are constantly like cracks in that mosaic are... [20:24] opening and then being formed by and being filled by something else. Yeah. So it's definitely for me comes from like initial place of this curiosity about business. [20:32] And then I think like just by nature of where I am in Silicon Valley doing, you know, private company equity investing, like you end up trying to find like what are the most interesting companies? And those are often led by the best founders. And then when you're actually doing your reward analysis, like it comes down to the best people matter.

[20:48] the most. And I think there's one thing I've done really well is I like, [20:53] And then because I joined Sequoia so young, I was... [20:55] 23 when I started and I didn't, [20:57] The first investment that I put my [21:00] I was neck on the line for, the first investment I sponsored was in Robinhood. That was... [21:06] I think four years after I joined. So I did four years in the salt mines, you know, like just similarly, you know, just observing. Right. I was doing all the memos, you know, doing all the models, crunching a lot of numbers, crunching a lot of numbers. And, you know, I'll have opinions. [21:19] But I wasn't ultimately the one who was responsible for that investment, filling out the portfolio review software form and giving the update. Yes. [21:27] And then... [21:28] I think Robin Hood was obviously an instructive and amazing and crazy experience in a bunch of different ways. [21:36] But I think it's really important and really lucky to get like a – [21:39] a banger out the gate as an investor, because then all of a sudden your model is trained on what great looks like. Really positive feedback loop. Yeah. And it's both in terms of your own learning and in terms of your reputation and otherwise. And I think with that experience of working with Vlad, and now I'm working with Vlad again on Harmonic, his second company. It's like the AI math company. Yeah, the AI math company. [22:02] I just like, oh my goodness, I can find these and identify these really outlier people, and [22:09] like, [22:10] I think starting with Vlad and then... [22:13] you know, going through to like Vlad in two to round two, like, I think I've just picked the best set of founders. Like I would not, you know, trade my team competing against the Space Jam aliens, you know, for anybody, like for literally anybody. I think I have the best set there is. And, um,

[22:30] And then once you get used to that, [22:32] you know, your Bardis gets raised so high, you know, [22:35] like, [22:37] I think it just keeps you focused on the main thing, which is identifying amazing people. And then obviously having a team like that working on your behalf is really helpful too. Was there opposition to the Robinhood investment? Was it like a fairly consensus type thing amongst your partners or peers? Or were you kind of pounding the table? [22:59] It was... [23:00] So ultimately consensus, obviously, like contentious, it's a very... [23:05] you know, divisive company and still is to this day. [23:08] um, [23:09] Charlie Munger went to his grave... [23:13] you know, railing against Robin Hood. He actually had this, and obviously, you know, bless his soul and rest in peace and Charlie Munger, like, we... [23:20] I love Charlie Munger. [23:22] Yeah, he did an interview where he said... [23:24] Sequoia... [23:26] is the best investment firm ever. [23:29] In the world. [23:30] but I can't believe they invested in Robinhood, the company's evil. And imagine being like an associate at Sequoia. That guy in Reed screwed up. You know, it's like your only company, and Charlie Munger is, you know, going on the record, just railing against it. [23:45] That's not the most comfortable place to exist, you know? [23:48] but [23:49] It's actually amazing. If you look at just the, um, we can get talking with Robin Hood for much, much, much longer. Obviously that was like the, probably the, one of the few formative investment experiences in my life. And just the rollercoaster, um,

[24:01] It continues to this day. [24:03] But the initial entry into the investment was... [24:08] not super comfortable, and it didn't stay comfortable for very long. [24:15] You have this model of Vlad today. [24:18] Um, and let's say that's like whatever, 99% knowledge or conviction of his greatness or whatever. Like, was that a critical part of your initial conviction or did that come later? Was it, was your conviction in something else about the business? [24:33] Well, first I would just like [24:34] I'll often just mention Vlad as shorthand for Vlad and Bijou as co-founder. I'll do that with Figma. Dylan and Evan is co-founder, right? You sort of often shorthand to the guy who's running it now. But so much of the DNA of these companies comes from the full set of not just co-founders but early employees. But co-founder, so central. [24:55] I think that [24:57] Uh... [24:58] I was actually thinking about this this morning. [25:01] I think the degree to which the best founders... [25:05] change and grow over the course of their company's life is [25:09] extraordinary like Vlad today versus Vlad 10 years ago is borderline unrecognizable. [25:15] And it was both the successes and failures of Robin Hood that sort of like made him – [25:21] change so much. And it's not obvious to me whether it's, you know, the companies that grow so much, like force change upon the person running them, or if it's the fact that the founders changing so much that creates the, you know, the success of the company, um,

[25:35] But I think there's this one common trait around... [25:38] like a genuine growth mindset. And I think like, [25:40] It's the... [25:42] I am capable of learning anything. And when the job requires me to go learn that thing, I'll just go do it. [25:48] I think Vlad back in 2016 was, they did such a good job hiring engineers out of Stanford and building incredibly compelling products across onboarding into a FinTech app, across the infrastructure. They built the first self-clearing company. [26:03] system built in America, I think in 30 years, took over a year to develop. Like it was, you know, one of these like really hardcore fine finance infrastructure projects. And like Vlad spearheaded a lot of that. And then Beiju was a lot of the creative energy, some of the kind of countercultural elements that like made Robin Hood so unique and special. And they both did, you know, both of that. [26:22] But the Vlad now of like standing on stage and like being like a true spokesperson for an industry and a movement – [26:28] That is not the person he was then. And I think now he's so capable and mature, and he still has, he can still recruit amazing engineers. The people that Harmonic hire is amazing. [26:39] blow me away. [26:40] But also he can, you know, stand at Cannes in front of the ocean with his amazing outfit and, you know, like, yeah, like speak to a whole, speak to the whole world. [26:51] I guess I have two questions off that, which is... [26:53] I still wonder, like, did you... [26:57] Ultimately, was there a seed that you saw or were you like... [27:01] excited about Robin Hood for some other reason and like got to. Oh yeah. I, I forgot to answer the question you asked. Um,

[27:08] One of my things I used to say, I feel like you kind of go through these things where you learn something and you say it a zillion times to different people when you have some insight, and then after six months, you get tired of saying it, so you go on the next thing. [27:21] Um... [27:22] Thank you. [27:23] One of the things that [27:24] I was saying a lot back then. I was like, [27:26] you can't find the companies with the 90th percent metrics cost every dimension because the 90th percent [27:33] Startup. [27:34] doesn't go anywhere, you know? You have to find companies where [27:39] There is a summary. [27:40] outlier dimension and I think for Robin Hood the thing I saw back then is [27:46] like I wasn't the first to it, was... [27:49] They were just [27:50] uncannily great at... [27:53] dominating the, um, [27:56] the front end of that business, which was, you know, their share of new account openings in the U.S., even when they were small and irrelevant, was north of 60%. Like, they were... Those are some crazy wait lists. Yeah, out the gate, they jump at the big wait list. But also, it's like, reliably, even when, like, the industry was slow and equity markets were, you know, [28:16] boring for people like they were still just the vast majority of new account openings in the u.s and they're doing it without blasting the world with you know e-trade advertisements and everything else it was just like it is such a superior product um [28:29] Back then in 2014, the idea of, you know, this is back when you used to like log into your desktop to do serious banking tasks, you know, like even the fact that your people would be holding like big balances on their mobile phones was a little bit outlandish.

[28:43] And then they just like... [28:44] continuously, like, [28:45] Just [28:46] kept people engaged. And that was the thing that I really... [28:52] really stuck with me was the first was this, the, [28:55] And it wasn't a lot of FinTech apps aimed for the underbanked and try to provide financial services that are available to one class of people to other people who are less well served. What Robinhood did was just like they found this platform. [29:07] like big profit area for incumbents, which was commissions. And they said, this doesn't need to exist, right? Like if you don't have branches and you have like a, like genuinely low cost operations, you could just, [29:20] like remove commissions and you can make enough money through payment forward flow and stock lending, other mechanisms that you can just, you know, [29:28] you know, grow a business here. - By the way, then you throw everybody into a crazy innovators' llama. - Exactly, and the things that, you know, people rub it up, oh yeah, but they're just like, [29:35] They're doing payment for order flow and not commissions. And people fail to realize that. [29:41] You know what EJ was doing? Both. It was strictly better for people, besides Fidelity. Everybody else was doing both. And they just wiped that category out. And companies found, I think, in 2013. [29:56] September 2018, September 2019 was when Schwab, E-Trade, and Fidelity all white Christians to zero on the same day. And, you know, that's like the George Bush, like, mission accomplished banner, right? Like, literally the point of, like, the initial, like, one of the initial impetuses of the company was just, like, to monetize finance for all. And the first mission was to, you know, eliminate commissions. And within five years, literally, that's no longer a thing that exists. Crazy. You know, and that was in some ways just the beginning, you know.

[30:25] Huh. [30:27] When it comes to seeing sort of like the blads of tomorrow, [30:30] Like how has, again, maybe to go back to like, if you, if you have him modeled like 90% or 95 or 99%, when you meet somebody today, you know, you're going to be a good person. [30:38] And maybe there's also something that's pulling you in, e.g. the approach to the product or the technical competence or whatever. But you're modeling that at 10% or 20%. [30:48] How have you thought about [30:50] being able to see the seed that is going to grow into that kind of exceptionalism. And clearly you've been able to do it across lots of people, given your Space Jam comet. Yeah, there's like, I think there's sort of two... [31:02] There's like two ways that I can develop conviction on a person. [31:06] I think sometimes you are lucky to [31:09] have met somebody for months to years before this investment opportunity, and you like watch them develop and execute and run their company. [31:17] I think with Dylan from Figma is a good example. I met Dylan... [31:22] riding shotgun to one of our early stage partners for one of the early stage rounds of Figma, and saw what the company was then. [31:29] and [31:30] Solio Cuervo, who was one of the early Facebook product designers and a highly relevant figure at Dropbox and otherwise, was also in my ear about Dylan. I followed the company, and it was 500K of revenue, and most of whom were on Windows machines, and Sketch was only on Macs, and it was hard to see. And that was the round that Mamoon from Kleiner did, which is absolutely one of Mamoon's many iconic investments. Yeah.

[31:57] And, you know, kept falling into space. [32:00] And then when it came time for like the series C, which is one that we did, the company had grown from 500 K to 4 million in revenue, which, you know, [32:08] On paper, it feels like it's still a very small company. But I could not have been more sure about doing, you know. You also paid it. [32:15] if I, [32:16] remember correctly, a pretty obscene price. $400, yeah, which was, yeah, that was viewed as ludicrous, you know, unhinged. [32:26] And obviously, you know, Dylan's only continued to develop. So that's one, you know, I'm going to put similarly, the most recent board I've joined is Eleven Labs, the AI audio company. And [32:39] Same sort of dynamic, like we invested in 11 Labs two years ago. I didn't join the board, but just like watch Madi, who's the founder there, as a like young Polish kid living in London, building a company at the absolute like most competitive bleeding edge foundation model, creative tools, AI agents, like on paper. [32:58] that guy is never going to win that race, you know? Right. [33:00] And then all of a sudden, you just watch him... [33:02] month to month and quarter to quarter, 'cause they grow and develop and change, the company just becomes this winning machine. And so the question was, would you do the 11 labs for? Would I want Motti on my Space Jam team? Like absolutely, 100%. And that's a very comfortable way of, I think, developing conviction on somebody. Or when you get down to the rubber meet the road, should I pay this price? The answer is an unequivocal yes in your gut.

[33:30] I think there's a smaller category of investments that I've done where it's like, you're at a shotgun wedding. Is this person... [33:35] that good, you know? [33:37] Probably my favorite example is Cristina Casciapo, who runs Vanta. [33:42] Which is... [33:43] now a very large and very dominant security company here in SF. [33:51] This was in 2021, Jan 2021. [33:55] You know, a couple rounds happened in like 16 seconds and... [33:58] I got introduced to Christina by Dylan actually, and I checked our like notes in SMS, which is SMS is our internal data science CRM type product. [34:10] Sean McGuire, I've been tracking the company for a long time. He was like, this is the company I would invest in if I had the chance to. [34:17] Uh, and then like Dylan was like, you gotta do this investment. And then, um, like Patrick Carlson called me, so you just gotta do this investment. And then Christina, and within about 14 seconds, uh, [34:27] I decided that [34:28] I should do this investment, you know? And, um, yeah, it was like instant. And then actually, [34:35] We had Christina talk at our LP meeting. [34:37] two years ago, and her memory of our first meeting was that I was rushing her through her pitch deck. The reason I was rushing her was I was like, "I know it's good. Let's get to the part where we try to figure out what the terms are." That's funny. [34:51] And she never told me that, but she told all of our LPs. Yeah. [34:56] And for that, it's really like the sparks fly sort of moment, you know, where...

[35:00] And it helps when the company's growing really fast and profitable. Right. Like, I guess that's my thing I'm wondering is, like, [35:07] Well, one backdrop for all this that's interesting is typically – [35:12] Early stage investors love to talk about people. And later stage or growth investors love to talk about other things, other types of momentum. And so I guess like how much of this is... [35:21] all this people stuff you're saying with the backdrop that also the thing is starting to rip. Yeah. Like maybe that's the given. [35:27] Thank you. [35:28] Yeah, I think if you divide the world into like [35:30] founders who are obviously amazing to you, which is a taste thing, and then numbers that are obviously amazing to you, which is also a little bit of a taste thing, right? Like different investors certainly weight different metrics in different dimensions. And I'm probably more comfortable with like some metric screaming red if enough other ones are screaming bright green. Okay. Okay. [35:50] But if you divide the world into... [35:52] you know, amazing founder to you and amazing numbers to you and like don't deviate from that, you'll maybe find three companies a year that meet your bar, you know, [36:00] And then of those, like one will be priced so ridiculously, you're not going to do it. And the other two, you do. And that's basically like what I've done for the last 10 years. [36:06] Yeah. [36:07] If you could... [36:09] to keep doing your job [36:11] You either had to... [36:14] Well, actually, I'll split it up. If you had to do your job without ever meeting a founder ever again... [36:19] how would it affect your returns? And then if you had to do your job without... [36:23] Maybe this is stupid, but like ever using Excel ever again. [36:26] How do you think it would affect your returns? [36:28] Oh, there's a great...

[36:31] I will keep talking about... [36:32] Charlie Munger, despite his criticisms of me, because he's obviously, you know, the goat. There's a great back and forth between Warren Buffett and Charlie Munger where, you know, Warren Buffett's talking about how if you like, you know, are doing a DCF on a company and it says... [36:45] And Mugger interrupts him and is like, you know, you've never done a DCF. And he's like, no, if you have to actually do the math, it's too close. [36:56] You know, it's like, [36:58] You just do a quick DCF in your head, and if the company's good enough, the math just takes care of itself. And if you have to resort to doing data analysis, you're in trouble. And I think that's probably... [37:09] true. Like I think there's like the occasional corner case where you have to do some sophisticated analysis around cohorts around usage to get to like the ground truth of a company. [37:19] But... [37:20] More often than not, like the output metrics sort of take care of themselves, you know? [37:25] And it's like almost like don't get cute. Yeah. And yeah, exactly. And [37:30] And then even if there are situations where you have a company that's growing really fast and the issue is, like, what's the churn? You know, like, you can get to that pretty quickly. Yeah. Um... [37:38] I think the no founder thing would be impossible. I wouldn't even know. I'd just buy an index. Maybe that's the fundamental difference between the work you do and other parts of finance or private equity or whatever. Yeah. Or even public equities. Yeah. [37:52] I found this, actually a friend sent me this, [37:55] Hilarious thing. Green Oaks has... [37:57] quite literally trademarked, uh, [38:00] jaw-dropping customer experience, unquote, breaking trade-offs. And so I'm curious if there's anything that you would trade off or trade off, trademark, in terms of like the style or the things you're looking for or the – maybe a lighter version of it is just like what's on the Andrew Reid Sequoia website.

[38:18] vision board. Yeah. [38:20] Yeah. [38:21] You know, um... [38:23] I don't think I'm innovating on any dimension. Like the... [38:29] And what's interesting about, you know, working with someone like Pat, and I'll talk about Pat for a minute because – [38:33] He is... [38:35] like definitely the most influential person on my career. And, um, Pat and I, you know, co-led the growth business at Sequoia together for a number of years. And, um, [38:45] I've been his... [38:48] His associate, I've been his partner, you know, it's like, [38:51] he and I disagree about investments so often. And the specific thing that often happens is Pat brings in... [38:59] a company. [39:01] And [39:03] you know, my humanities taste element, you know, just isn't clicking for some reason. And the thing that Pat hates, Pat hates... [39:10] when he feels like people, because of his track record, aren't telling him the truth. So I always try to tell Pat... [39:16] my absolute truth on the companies he brings in, which sometimes is like, dog, what are you doing? You know? And, [39:24] The reason why Pat's like that is he's got this... [39:27] You know, whereas I don't have anything I would trademark in terms of, you know, frameworks otherwise, I feel like you could, you know. [39:34] freeze Pat's brain and like chip off a little corner and it's got some framework that he hasn't even told you about that, you know, unless you ask him, you know, it's like the whole thing is this Rube Goldberg machine of, you know, like frameworks and processes and... [39:46] I think if you are 90th percentile frameworky, you're not going to be a great investor. If you are 100th percentile frameworky, you can actually be extraordinarily creative because a lot of people are just doing shorthand on things and just miss incredibly obvious opportunities.

[40:01] Probably my two favorite examples. One is our investment in open evidence, which is the leading AI app for healthcare professionals. And this was a company that had... [40:12] No revenue. It was, you know, selling a free... [40:18] AI service only for licensed medical professionals. [40:23] that looked a lot like JotGPT, but it was up to date with the most current [40:26] a medical literature, uh, [40:28] And [40:30] It comes in, the founder had a really good reputation. He started a company called Kensho, which he sold for, I think, $700 million, $200. [40:39] But he was living in Malibu, and the team was working out of his house in Malibu, and it had like 10 people and no revenue and, you know, [40:47] A few of us have like doctors as relatives and none of them ever heard of this thing. And literally that was like, you know, I think we should do this investment. [40:56] You know, it's like... [40:58] why? You know, it's like it was just it seemed just so and, you know, it had raised no venture capital and they were going to raise a hundred million dollars and, [41:06] And it's just a [41:07] I don't even know where to begin on criticizing this idea. Maybe I'll start with no revenue, just to get the conversation going. And just point by point by point. [41:18] Pat. [41:19] Just like... [41:20] explained exactly what he saw and... [41:24] I think they just raised it like $12 billion, and it's backed by just incredible... [41:28] incredible numbers. In this sort of framework-y, system-y type... Yeah, it's like, just systematically piecing apart your argument. You know, and just like...

[41:36] you know, like, [41:37] Oh, like... [41:39] Yeah, I guess, you know, they got to the point where at the end of the process, like we were all [41:42] really enthusiastic about investing, you know, Pat's got a strange brain. So he really wanted to win this investment. And, you know, we get to give the issue, the term sheet and Pat's working late at night. And he's the kind of guy like he won't ask. [41:54] the finance team to do a term sheet late at night if, you know, he can just do it himself on his computer. But he really wanted to get it signed because he wanted to, you know, get it over with and move on. So, Pat. [42:07] logs into like the DocuSign portal and like creates the DocuSign for this term sheet, which you've never done before. And I also have never done before. [42:15] And he sends it to the founder. And then they go back and forth and the founder loops in the lawyers. [42:26] and Pat's like, when's this guy going to sign a term sheet? And then the founder invites them on this company off-site in [42:32] Bora Bora or something. And Pat, he's like, "Okay, yeah, of course. I'll be there tomorrow." He comes with the only goals. I can't leave the office to go to Bora Bora and come back with that term sheet signed. So he spends the whole two-day offsite talking to 11 employees of this company, really trying to find the right moment to get this thing signed. [42:55] And then he realized that when you are the one who puts in the DocuSign, you don't actually get the email back that says the guy signed it. The guy signed it immediately. And Pat's been like 10 days of his life so stressed out, literally flying to Bora Bora, stressed if I got his term sheet signed. He's like, we're already working. Yeah. Yeah. Anyway, that's Pat, you know.

[43:14] Ha, ha, ha, ha. [43:15] maybe, maybe I guess to come back to you, like, [43:19] This business is one of... [43:24] sort of continually finding exceptions, [43:27] And yet, [43:29] Sequoia and seemingly you have done quite a good job of doing it over and over and over again. And so like, [43:35] If Pat is on this 100% framework, highly structured, [43:41] way of doing things, do you feel like you're continually pulling rabbits out of hats? There are some... [43:49] Clearly, you've developed an instinct on the people side. Maybe this gets into taste in even numbers, which I'd like to talk about, but I'm curious, what is this tension between consistency and consistency? [44:02] exceptions. [44:04] Well, I think one of the ways that, [44:06] I think one of the ways you learn how to do this job, maybe the only way is to watch the people you work with do the job and figure out your own way from there. [44:14] And I think one of the things that Jim Getz used to always talk about is people who can repot themselves as investors. You know, Jim... [44:21] you know, help put together that seed of Palo Alto networks with Ashim from Greylock, you know, and it was one of like the leading cybersecurity investors. [44:29] early stage cybersecurity investors. [44:32] And then he turns around and does this kind of growthy round in WhatsApp, you know, and... [44:36] I think that, or like Mike Moritz, you know, who obviously did Yahoo and Google and PayPal and then lost money on Webvan, then turned around on Instacart and did Stripe. You know, it's like, or Doug Leoni, who's like the most famous enterprise investor of his generation at the tail end of his career just kicks in the new bank seed in Series A and, you know, biggest return of his career and one of the biggest ever in venture. Like, there's this kind of this...

[44:59] The track record of people who just don't get bogged down by, I am a SaaS investor. I'm a Series B investor. It's people who are consistently willing to reinvent themselves and take the risks on their reputation or their knowledge, understanding, etc. I think that's one of the... [45:18] Key lessons from Sequoia is you just can't keep doing things the same way, and that applies at the system level, right? Like, what businesses are we in, how we set up our teams and everything. And at the individual level, we don't have swim lanes in the same way some people do, you know? [45:32] Like imagine, [45:33] Let's just say like every investor does. [45:35] two or three deals a year. [45:37] um [45:37] Imagine entering 2021 or entering 2022 and [45:43] You have like... [45:44] of your 10th person investment team, two people on AI, right? That means maximum you have six AI investments, right? And people aren't perfect, you know what I mean? That would be crazy, right? So you kind of want to have like, [45:54] You'd rather have a team of curious people who... It's a little bit... I mean, I'm sure you'll back down from the comparison, but it's kind of how you were describing Vlad, which is this just like default, I can... [46:06] I can figure it out. I can figure it out. Yeah. I've always, I mean, to me, it's like if hedge funds can have TMT analysts, why can't we have TMT analysts? I can be a TMT analyst, right? Like it's, um, and obviously there's some people who bring like really specific domain expertise, um, [46:20] Like I was lucky enough to wingman Sean McGuire on our SpaceX investment. [46:25] You know, like Sean's got big ideas and, you know, he's very vocal about sharing them.

[46:31] And [46:32] when we went to SpaceX, [46:35] and his friend was like a quantum physicist and like worked with rocket companies and, but you know, in his past life, we're like walking through this factory floor where they're, you know, making spaceships. And he just like notices that, you know, one of the, [46:48] I don't even know how to describe this thing. I'm like, one of the things that moves the satellite in space, they're using some gas that you wouldn't have assumed that they were going to use because of, like, the label on this tank. And then he asked the question to the guy, and the guy explains why they, you know, why we use this gas and not that gas. [47:06] And I was like... [47:07] I didn't even realize that was a satellite yet. I'm not even in the zip code, right? So there is this dimension of you do want people who have, if you complement that with people who have real domain expertise and can really up-level your thinking, that's how I think you get really exceptional investments. But all of us are always trying to learn and trying to just try new things. [47:30] Yeah. [47:30] I think there is a underrated lesson there. [47:34] amongst great investors, which is that they are [47:37] Maybe this is much more obvious in the growth side of things, but they are not only right, they are right with size and with extreme conviction. Maybe to start, what is different for you between investing – [47:50] at least maybe not for Sequoia's first investment, but for your first involvement in a company versus doubling down. [47:55] So, [47:57] I think in general, Sequoia has invested over a billion dollars at cost into, I think, three companies now.

[48:04] And in general... [48:07] The way we've gotten there is starting very, very small, you know, and... [48:12] doubling down and tripling down and, um, [48:15] Stripes, a great example. We first invested in 2010, and our first investment was a million bucks or something like that. [48:22] I think the biggest source of unfair advantage in evaluating investment opportunity is... [48:26] Being on the inside. [48:28] Both in terms of, like, obviously being in the board and seeing the pipeline and seeing how things are developing and watching the founder execute. Yeah, all the people stuff you were talking about, Vlad. You're not going to get that lens. Yeah. And it's funny. It's actually not universally... [48:42] I think the hardest round is the next round after you invest. [48:46] It's actually quite straightforward to do. [48:50] make the investment and then... [48:52] seven years later when you have like extraordinary conviction and the company's marked up [48:57] eight times from when you invested, but they've grown the business 30-fold or something. Make that investment. The hardest one is you invest [49:06] Six months later, there's a term sheet in at... [49:09] five times the price you just invested in. Very little much, like not more data. Yeah. Like the data is, in fact, you just joined the first two board meetings and like the things you didn't realize. You didn't see the bodies. This person's leaving the company, you know, like, [49:21] and other people are really excited to invest, [49:24] in part because Sequoia invested and in part because the company is obviously interesting. [49:28] Like that's the investment that probably like time and time again, [49:32] Like I and we have screwed up, you know, it's just, it's just really, really hard. Yeah. And it's like,

[49:37] Yeah. [49:38] the first explanation is, oh, you're price anchoring, right? It's like, you know, how do you reevaluate [49:43] But it's not just that. It's like across all these different dimensions, you know. [49:46] It's the validation of getting somebody else is going to pay a big price for this company. Yeah, now you're getting a markup. [49:55] If I could just solve that problem on my investments, that would be the... [50:01] snap my fingers. Um, and I try so hard, you know, like, [50:05] Change your process. Change how you think about things. Ignore the board deck. Study the board deck. You're like manipulating your own psychology. Trying to, yeah. And so far it had a little effect, but I'm only 3'5", so I can figure it out. [50:17] You wrote some lessons from your first 10 years at Sequoia, and one of them was Don't Flinch. [50:23] Can you talk more about what you mean by that? [50:25] Thank you. [50:26] Yeah, I think opportunities that you're really excited about, [50:30] reveal themselves highly infrequently and never at opportune times. [50:37] And I think... [50:38] For me, my... [50:39] My proudest moment as an investor was... [50:43] Yeah. Seeing Dylan at the New York Stock Exchange, that was the coolest thing ever. And just [50:48] I was just so happy for everyone at Figma, given the acquisition and the antitrust and the whole thing, and just seeing them there and just like... [50:57] That was my proudest moment as a investor. Second proudest was this investment we did in Robinhood in 2020, the first week of COVID, which was – [51:06] I grew up around New York City. I had dreams of

[51:10] And I graduated high school in 2008. [51:12] So like, you know, this is like the... [51:15] Like when I was, you know, entering the adult world, like, [51:18] the financial crisis, [51:19] in New York City [51:21] was the main event, you know, and... [51:26] I had always kind of, I remember I read the big short right when it came out and I had to go, how am I going to react to like a crisis in finance? I picture myself on Park Avenue, you know, like. [51:36] like wheeling and dealing, going to a boardroom, making a deal happen when things were blowing up. [51:42] And then you know, that's how you envision it in your head. And like, I really wanted, you know, it's fun and traffic. I really want. [51:48] to be a great investor. I really wanted to be a great investor. I imagine myself in the [51:53] What it actually looked like was, [51:55] I just bought a house. It had a pool outside. There was no furniture in the house. [52:00] We were locked down because of COVID and I had, you know, [52:04] An eighth of my wardrobe there. [52:06] And I was doing circles around my pool. I was very happy to have a pool, you know, but it was like doing circles around my pool, talking to Aladdin Bezier about his investment when... [52:18] you know, the market was gapping down five points every single day, but Robin hood was like, you know, this is back when you could double your money on Boeing and, you know, 16 minutes. Um, and we, we, uh, did a $200 million check right that first week of COVID, you know, the app was down for a whole day. It was chaos. And to me, like when I say, don't flinch, like, [52:37] I was so, I felt so proud that, you know, just,

[52:40] not being scared of that moment, you know, in part because I prepared myself for it for so long. Like, what was... [52:46] what would the guy you want to be do in this moment, you know? And similarly, like dealing with... [52:52] you know, [52:53] legal battles that you end up entrenched in and otherwise like, [52:57] I think you just can't let yourself down. You know, like I think all of us like to imagine how we'll react in these like really high stress, high stakes moments, but, [53:06] And, [53:07] Yeah, don't flinch at me just means like just do the thing you know you should do. [53:12] Seemingly your conviction, [53:14] And, and, and, [53:15] I think the results would say success rise to the occasion with stakes. Like you, you, the relationship between conviction and stakes for you increases. I don't think maybe that's in the answer you just gave, but I don't think that's necessarily obvious. [53:29] be true for everyone. Maybe it is true for all good investors, but is there either a psychological or even like an internal mechanical way you relate to... [53:38] Yeah, meeting... [53:40] meeting the stakes with a supreme amount of conviction and getting to the point where you're not going to flinch in those types of moments. [53:49] I mentioned earlier in the conversation having your first investment be Robinhood. [53:54] has paid huge dividends for me. [53:56] in that [53:58] what could possibly be more stressful than the GameStop week? You know, and then, you know, that was one of seven really challenging weeks at that company. [54:09] I think once you...

[54:11] when that's the norm, you know, [54:14] Everything kind of just like [54:16] like your heart rate doesn't move that much. - It's been forged through the fire. - Yeah, a little bit, right? It's like, I think it's people who came out through crypto, for instance, have like a very unique, [54:25] psychology for the markets because you faced 17 drawdowns in the same thing. I was born in the darkness. Yeah, no, I think it's a real thing. And in terms of like... [54:35] I was thinking about the Figma M&A unwinding and then subsequent success on IPO. What was the period of time? What was the gap? [54:42] Between when the deal was signed. $20 billion Visa offer and then IPO. From Adobe. Adobe, I'm sorry. Yeah, it was September... [54:51] September to December. So... [54:54] 14 months. [54:56] Yeah, September to the subsequent summer. Some of those 14 months were... Yeah. You know, and then, you know, I took over the board of Klarna in a very, like, widely publicized, you know, like, [55:06] challenging situation and, [55:09] I think I was like the perfect person to step into that and just like, you know, help sort, help people sort through their things and get the company to the IPO. And, you know, again, like, [55:19] If I could be known for that, you know, the person who's, like, very uncomfortable in, like, deeply uncomfortable situations, that would be a dream, you know? I think I guess I have to keep proving myself, right? And you certainly can't. Like, the way you do that is... [55:34] You find yourself in them, which is... Sometimes you wouldn't wish upon anybody. But secondly, I think it is helpful to imagine yourself, how would I want to react to these sorts of things? And I can think of plenty of situations where...

[55:48] I wish I were more aggressive. One example where I certainly flinched was I brought in Vlad when Robinhood stock was trading at $7 a share, and I had him given up to do the partnership. I was like, "It seems like a good company. Maybe we should invest." [56:01] I just kind of got busy and it didn't follow through with it, you know. [56:05] So I've definitely, you know, far from perfect, but... [56:08] Yeah [56:09] You brought up boards. [56:11] This is you, I think. You were talking about how... [56:14] Obviously, at least the common kind of trope is a board's job is to hire the CEO. [56:21] You alluded to it just now. You talked about [56:24] also a role of a board member being a shock absorber, particularly in these moments of like chaos. And I think this is you, you said startups are emotional. And I think one of the benefits of having a good advisor or board member is that we genuinely care about you, but we can also be objective when it's required. It's like asking your brother for relationship advice. Yeah. Yeah. [56:44] How do you bring... [56:46] humanity, empathy, vulnerability to that role, [56:51] Beyond like. [56:53] Like in a way that is actually not like this BS cute thing and like a way that actually helps Sequoia make money. Like how do those two things fit together? [57:01] Yeah, I think companies are... [57:03] life is hard, right? [57:07] I think for... [57:10] I think for founders... [57:12] It would be better for their psyche if their ego wasn't wrapped up in their business so much. [57:18] But...

[57:20] I think that's a lot to ask for somebody who is in the eye of the storm building a company. And with so much weight and responsibility. [57:30] And... [57:31] so many people counting on you. Like, I just, people can kind of [57:35] experience their ego death later in life. And while they're running the companies have to recognize that like every up and down that the company goes through, they're going to wear, you know, [57:44] way harder than you can possibly imagine. Yeah. [57:47] I was talking to Ravi Gupta, who is somebody I really admire and I've worked with now for a long time. And Ravi describes, he used to Instacart, just like, whenever an investor would tell him, like, have you thought about this, some idea? And he's like... [58:01] you MF-er, I think about this company 20 hours ago. You know what I mean? Like there's nothing you've thought about I haven't thought about, right? Oh, you got a suggestion. Yeah. Which, which, you know, which doesn't mean don't make suggestions. It kind of just means like, [58:14] That's not, you know, it's not, have you thought about this thing? It's like, surely you've thought about this way more than I have here. Like, here's what I see, you know, um, [58:24] is one dimension. The other dimension is like sometimes people just don't want to talk about it. [58:30] the fact that you have a meeting schedule with somebody and you haven't talked about this really important topic, right? Somehow means now is the right time to talk about it, right? Like sometimes it's okay to go to a meeting, [58:40] And just like, [58:41] not talk about that thing because it's not the right time to do it, you know? [58:46] And when I say meet founders as people, right?

[58:51] This is a deeply personal relationship I have with the people I get to work with. That applies to my partners and applies to the families I work with. Yeah. [59:00] When I'm feeling like I'm having a hard time or struggling, [59:04] they hear about it too, you know? Um, so often I'm looping in founders to like, help me win investments, help me think through investments. Like, and I think like, [59:13] Revealing that I don't have all the answers. I really want your perspective. I think it's helpful for them because they can kind of come back and feel the same way. [59:19] Yeah. [59:20] When you were talking to the TBPN guys, you said the first thing you do when you join a board is learn what business you're actually in. Yeah. Can you talk a little bit about that? [59:30] I think that's a Doug line. [59:33] Thank you. [59:34] I think part of it is you are being sold when you're investing into a company. [59:43] Companies are revealing the metrics they don't like. They're often doing it in the... [59:48] Same way you will formatively open up to a new friend. You know what I mean? Like, allow me to tell you about my insecurities. If you're telling me so quickly, like, that's not the issue, you know? [59:57] Yeah. [59:57] And when I say like know what business you're in, [1:00:00] It's like... [1:00:01] the bottlenecks kind of like reveal themselves in business. You know, we're trying to, you know, it's like systematically trying to remove things. [1:00:07] the next set of bottlenecks to enable the next set of growth. [1:00:10] And you do that time and time and time again until you're wildly successful. [1:00:15] If you go to the Microsoft board, I'm guessing they're [1:00:18] thinking about the bottlenecks to their growth. And, you know, and, you know, you think you have a sense of the bottlenecks, but like if a company's growing fast enough, it'll be a different set of things in two months anyway. Mm-hmm.

[1:00:27] and like the interpersonal side, like how does this – [1:00:30] person recruit, right? Like how does, you've never been on search calls with them or seen them try to close a candidate, right? Like, how does this person manage a team? You know, like you, [1:00:39] You just learn so much about this business that you now own a stake in that you can't possibly learn when you're on the outside. Yes. And you also have the psychology of being an owner, part owner of the business, evaluating all this versus an evaluator. Yeah. And again, this is why that first investment thereafter is often so hard. Yeah. Because, and I, you know, PSA, I love all of you. But like that first board meeting is very rarely like, holy shit, we're going to make so much money. [1:01:09] Yeah. [1:01:09] lowlights. [1:01:12] There's a non-uncommon thing where you'll like, a company will have gone from [1:01:16] you know. [1:01:17] Real example, I want to show the name. It went from, I think we're going to see a great investment, but it went from $4 to $20 million of revenue we invested. First board meeting, you get the thing. We went from $4 to $20 on a plan for $33 or something like that. So it's like, why do we miss our plan so badly? And even on the outside, all you see is the $4 to $20, right? [1:01:47] the $26 financing lead explained the point. And they're not narrativizing it in a positive way. Yeah, exactly. [1:01:52] Is there ever a time when price doesn't really matter? [1:01:56] Well, the price always matters. Maybe to go back to Figma as an example, you paid an obscene price.

[1:02:03] Yeah. [1:02:05] Maybe that's just the nature of this business, and there's always going to be people who think the price is obscene. What happens... [1:02:11] You are certainly in the growth stage, too, and someone with your kind of orientation, love of kind of like the art of business building. Yeah. Yeah. [1:02:19] there are early stage people are just like, it's all vibes, man. Like smash, like founder bet. Doesn't matter a hundred million pre let's rock. Yeah. Um, [1:02:27] you clearly have less of that, but still there's a time where you're going to say like, [1:02:33] I would pay an infinite price, but I'm going to pay a price, an order of magnitude beyond what makes sense. Like, what's happening there? All right. [1:02:41] allowed me to leak some alpha. On the flip side, I have a theory that no one actually listens to podcasts. No one will ever hear this. [1:02:52] One of my, like, [1:02:54] I did really well in that cloud SaaS product growth wave of companies. And I think one of the reasons why is just like, [1:03:03] I just never thought about companies on an ARR multiple basis because for companies that are growing really fast, you obviously grow out of that. [1:03:10] like very quickly, you know, [1:03:12] And if a company is... [1:03:15] Let's just take $4 million of revenue, right? [1:03:18] If you got there going quarterly, one, two, three, four, right? That's very different than like one, 1.5, 2.7, four, right? Like it's the net new ARR like, you know, [1:03:30] like what are you actually doing in the market this quarter that like the true size of your business? So I always thought like a winning SaaS company should trade between 100 times to 200 times quarterly in that new ARR, which says –

[1:03:42] If you went from pure Figma and you're at four million of ARR, but the last quarter was two to four, [1:03:48] You added two times 200. That's 400. That's my line, right? If you're doing $100 million net new AR quarter, guess what? I'll pay 20, right? Like it's... [1:03:57] And that's like a heuristic that [1:03:59] I think actually works... [1:04:02] at basically every [1:04:05] part of the chain. It's not perfect, but it's a much better... [1:04:09] way of doing multiples than looking at an ARR multiple. 'Cause like, yeah, Figm was 100 times ARR, but it also was, [1:04:16] Thank you. [1:04:17] four times [1:04:19] Two year out. [1:04:20] like ARR, right? So, like, what's the right multiple? It's obviously the latter one, you know? [1:04:25] But often I'll be, like, I'll be with friends from other investment firms, and I'll start quoting my, like, net quarterly and net ARR multiple math, and they're like, what are you talking about? You can't do that. Yeah, it doesn't make any sense, you know? It's like, no, trust me. Like, if you look at your investments and go back and look at what price you actually paid, like, this is what actually, this is the market, you know? Like, the market doesn't do ARR multiples anymore. You're just not, you're just not... [1:04:44] thinking about it. [1:04:45] Like, anyway, so. I suspect there's a lot of that going on of just, like, [1:04:50] There is a set of rules that I kind of have to follow. [1:04:55] and that [1:04:56] There's like, you're not seeing the water. Yeah. Most people are seeing the water. This is like the, I feel like, you know, again, like, I don't think this is novel or insightful or differentiated anymore. But, you know, like, with the Vanta investment, we paid $480 for a Series A, right? Like, Series A at $480, you know?

[1:05:15] You know, it was I got from two to ten. [1:05:18] profitable in the last quarter was, I think, over a $3.5 million quarter, and I knew it [1:05:23] $480 is a good price. [1:05:27] Anyway. [1:05:29] I don't think I... [1:05:30] thing people love to talk about, but on the note of conviction, how do you know when to sell? [1:05:34] Pfff. [1:05:36] you know, like mathematically... [1:05:39] Look at the performance of... [1:05:42] founder-led companies. [1:05:45] uh, [1:05:46] and you own the whole basket. [1:05:48] the answer is you don't sell anything, right? Like, obviously we don't benefit from indexing, and the biggest companies kind of run away. [1:05:55] Yep. [1:05:55] But, you know, Sequoia, we've, like, set up our entire business around this idea that, like, we want to be able to hold shares in the best companies forever. [1:06:04] Because like the best companies [1:06:06] especially in the run by the best founders, [1:06:09] actually get better over time and [1:06:12] Sequoia has learned some extraordinarily painful lessons on distributing stock and companies or selling stock and companies. [1:06:19] you know, [1:06:20] even if it's an amazing gain. I think we own 10 points of Google at the IPO. I mean, Apple, it's insane. Apple, yeah, selling Apple for 40X on Apple. [1:06:30] 150k, you know what I mean? Don't do that math. [1:06:37] Yeah, so it's like that's the... [1:06:39] So we're set up to never have to sell or distribute. [1:06:45] Obviously, you're constantly trying to rerun the math, and if you get a 2021 moment where stuff's just...

[1:06:50] you know [1:06:51] unhinged. We are stewards of capital and we want to like our business, like I said, we're in the fund management business, you know? And- [1:06:59] we like really think about that. [1:07:01] but our default is at an IPO, [1:07:05] you like aren't even thinking about the lockup. You know what I mean? It's like, [1:07:08] I think it's very healthy. Oftentimes founders are thinking about the lockup and you're not. They call you like, "What's going on?" It's like, "Oh, damn." Yeah. You have a line where you said, and I think you briefly alluded to this earlier, you said, "Learning how to be neutral to happy when other people get ridiculously rich is an important trade in investing." [1:07:28] I'm curious how you've managed your psychology maybe on the inverse of – [1:07:32] Your own success. [1:07:33] And like how... [1:07:36] Again, maybe you were quite successful with the first Robinhood investment, but at this stage in your career, you've had a tremendous amount of success. [1:07:44] And so like. [1:07:45] Hopefully a lot of that is feeding the right inputs for continuing to make good decisions, but some of it I suspect could... [1:07:52] You don't want to get high on your own supply, I suppose. For sure not. You know, it's interesting. I think like... [1:07:58] This job is... [1:07:59] expressly humbling because companies so often undershoot their targets, right? And [1:08:05] Um... [1:08:07] even the best companies are often, you know, like... [1:08:09] If you're setting a good plan, you're making it most of the time, but missing it some, you know? If you're on 15 boards, like... [1:08:17] Companies are always, you know, [1:08:18] missing numbers and shit sitting in the fan constantly, you know?

[1:08:23] And you're just making mistakes left and right, right? Like you didn't see this investment turned out to be great. You're like late to... [1:08:29] the AI thing and your partners are doing better than you are. Like you're just constantly... [1:08:33] like getting harsh feedback, you know, and, you know, [1:08:37] I said, this is like, you know, it was, you know, 2025 was no cope 2025, 2026 is no cope 2026. Like this is, I think for the rest of my career, like, you know, you just have to just [1:08:47] just face the criticism head on and really try to understand it. [1:08:54] And... [1:08:56] I think you can do that without taking it personally. Like one of the things I find so interesting is... [1:09:00] People take podcasts at Sequoia all the time. You know, it's like because of our history and the legacy and people trying to position us, like you just like you just constantly hearing things, you know. [1:09:08] And [1:09:10] There was a point in my career when someone would, you know... [1:09:13] me on Twitter, like, you know, making fun of us or whatever, it would just rile me up. You know, it's like, but then I realized, like, you know, like someone's like criticizing me personally about my work, like. [1:09:24] I can live with that. You know, like, [1:09:26] why would I care if someone is like my employer? You know what I mean? Like, that's crazy, you know? But in the same way that, you know, a founder's egos get so thought up in their businesses, like, same with... [1:09:35] Anybody who's really cares for what they're doing, you know? [1:09:37] Yeah. Um, [1:09:39] And I think like [1:09:41] you do need this healthy dose of self-confidence in investing because – [1:09:46] You need to be doing investing, you know? Right. Right. [1:09:49] Um... [1:09:50] Also, the downside is capped and the upside is not. Yeah. I think the biggest issue people get into is like –

[1:10:00] I think you look at a lot of the best venture investments ever, it's often people... [1:10:06] earlier in their investing careers. [1:10:08] But it's very rarely their first deal. And I think the reason is because people get frozen on their first investment. Because if you're accumulating a portfolio of one, [1:10:18] Yeah. [1:10:18] You know, like the bar is just so high you can get stuck, you know. [1:10:23] If you have a portfolio of 20, it's often hard to [1:10:27] you know, like [1:10:28] be the first to something or really deeply understand something that nobody else can. But if you've got four or five companies and one of them is pretty good, [1:10:35] You're playing free. You see things really clearly. You know, if this thing blows up spectacularly, it's not going to, like... [1:10:40] Thank you. [1:10:41] kill your career. That's a really beautiful phase in people's careers. That's why I think any partnership [1:10:48] You don't want everybody having been there forever. You don't want all novices. That was like, you know, or like, not novices, but you don't want people who are like all [1:10:56] building a portfolio at the same time. You want people at different staggered development gaps. [1:11:02] I think about that sometimes. [1:11:05] You said... [1:11:06] Nothing you do before joining a VC firm prepares you for how multifaceted long-term success is. [1:11:14] Are there any facets? [1:11:17] that are particularly top of mind for improvement as you... [1:11:22] maybe not enter, but our... [1:11:23] kind of in the early phase of decade two. [1:11:26] Yeah, I [1:11:28] By my nature, like...

[1:11:31] I think very, and part of this is Pat, like Pat, [1:11:36] cares so much about [1:11:38] like how the venture business is run. Like, you know, how should we think about our structure and our team strategy and our [1:11:44] you know, processes and our pipeline and all that. Like, my brain naturally gravitates, like, outside the building, you know, like, companies. And for me, like, [1:11:54] if your brain's out there, the world's just changing faster and faster and faster. And so, like, I feel like for me, the main thing is, like, [1:12:00] how do I just like stay focused [1:12:02] freaking relevant, you know? Um... [1:12:06] in every facet of the job. Be it like, how can I identify the right founders? [1:12:10] how can I like understand what a great company looks like today? Um, [1:12:14] How do you evaluate? [1:12:16] the, [1:12:17] market position, long-term modes, metrics of AI companies, which actually look quite different than the last generation of AI. [1:12:23] our companies. [1:12:26] in the data center world, like I was Googling what a megawatt was like a year and a half ago. You know what I mean? Like, right. Right. [1:12:31] You kind of have to just up-level yourself so tremendously. I'm at a different stage in my life than I was when I was 25, and I like... [1:12:39] I had this amazing conversation with a woman named Christian Faulkner. She was the... [1:12:44] uh, 2024 Paris Olympics gold medalist. And she was actually a two time gold medalist. She won the, uh, cycling road race in the 2024 Olympics. I think I heard about this person. And she was, she's incredible. Um, [1:12:55] And we had this really wonderful, long conversation in August. She had just crashed out of, I think, the Tour de France. And she was just describing...

[1:13:05] you know, like what brings her joy at this stage of her life. And, [1:13:09] She had ascended to the mountaintop and... [1:13:13] She was like, [1:13:15] I know what it feels like and getting to watch like my younger teammates feel that feeling for the first time. [1:13:20] is way better than feeling that feeling again. And that one comment is going to stick with me for the rest of my career because... [1:13:29] I know what it feels like to... [1:13:31] make a really cool investment and start to feel like this winning feeling and do an IPO and sell a company, all that, right? [1:13:40] But getting to watch somebody else feel that for the first time and put themselves out there is... [1:13:46] Like there's just so much joy in that. [1:13:50] And I'm not, like, by my nature, like, the world's greatest. I'm not a process. I'm not going to grind people and, like, you know, make them do great work, you know. But I do want to get better at that. It's just, like, helping people find that moment, you know. Yeah. [1:14:03] Because when you see it, it's just like the coolest freaking thing. It's a great answer. I think we talked briefly about it, but... [1:14:11] There is obviously like a... [1:14:14] a gut, taste, instinct kind of part of this, even in the way you evaluate the quantitative side of things. There's also a thing I found where you were talking about kind of like your focus on quality and craftsmanship in companies. When I evaluate a company, I talk to users, try the product, look at job postings, API docs, support forms, not just the slide deck and financials. Great companies have a consistency of design and experience that permeates the entire organization and every interaction with their customers, users, prospects, or developers.

[1:14:44] attention and [1:14:46] to detail is important to me. [1:14:49] Why is, how does, and maybe it's super easy to point out with a company like Figma, but how does that kind of craft and attention to detail become a commercial input? [1:14:58] I saw you last night at the Stripe Press event that Temi Winter put on around the Stuart Brand book. [1:15:05] To me, like, Tammy's work on Stripe Press is the perfect example of how, like, [1:15:10] an amazing culture around quality and winning, you know, like just, it ends up seeping it like so deep into the organization, you know, all of its edges. And I think if you examine amazing companies, like, [1:15:24] At every angle, you can see that. [1:15:28] Same applies with the big Figma conference, like config, which they do. It's like Woodstock for designers. [1:15:34] You know, it's like [1:15:35] every little... [1:15:37] piece of it is just so freaking good. And like good companies just do things so well. Um, [1:15:44] And then I think, you know, as it relates to like products themselves, you know, we're in this like cloud code moment where interfaces don't matter. And it's just like, you know, everyone's going to be a creator. And I think that's a lot of that's true. Yeah. [1:15:55] As if in a world of infinite software, design and craftsmanship isn't going to be the ultimate [1:16:00] you know, arbiter of success. Like it has never been more important to have like, [1:16:05] tastes and an eye on when to stop and the ability to cull things and, um, [1:16:10] I think... [1:16:11] craft and software is not just... [1:16:14] you know, UI, it's like how fast that thing runs, right? Like,

[1:16:18] Is it... To change the detail. Yeah, it's like just the... [1:16:23] I think, like, design... [1:16:26] you know, design in the full sense, not just like product design, but, you know, the design and organization and everything it does has like never been more important. And that's probably shockingly somehow iconoclastic in, you know, early 2026. I suspect this time next year, it'll feel very different. [1:16:42] Thank you. [1:16:43] We are... [1:16:46] probably soon going to have computers that can do... [1:16:51] the quantitative stuff better than you can, if not already. And so I'm curious... [1:16:57] how much of your conviction... [1:17:00] And I don't think this is a perfect embarrassment, but like how much of your conviction is about knowing versus feeling? [1:17:06] This kind of gets into the taste thing, too. Yeah. It's like the gut instinct, I think, that... [1:17:12] You lean on. [1:17:15] I have not and I will not use an LLM to write. [1:17:20] I have historically also not... [1:17:22] I used our younger teammates to write. Yeah, that was their first LLM. Yeah, we have one of our [1:17:31] One of our best young guys is named Isaiah, and he just cranks work like you've never seen. [1:17:40] He often works with Ravi, and I'll often tell you that Ravi uses AI in his work, and AI stands for actually Isaiah.

[1:17:50] Ravi's been using AI for a long time, longer than anybody else. [1:17:53] But part of it's like this gut check where if I'm working on an investment, [1:17:58] And, you know, we do like long form memos. There's no sections. You start from a blank sheet paper and it's like write out your thesis and like fill in the supporting evidence. And... [1:18:07] when I like really want to do an investment, I will sit down and I like, no matter what's going on, I will stay up to the night and at 6am in the morning, it's, [1:18:14] You know, PDF consent. [1:18:16] When I'm like... [1:18:18] So it happens. [1:18:19] a few times a year. I'm like really excited, sit down and start writing and I just like lose this buzz. I lose the buzz. [1:18:26] And I don't even try to fight it. You know, if I hit that, hit that feeling, it's like, you know what? Like this might be a good investment, but like, this isn't what my best investments have felt like. Yes. So my friend, Chris packs is the same. He's like, I just have to, I have to be willing to do the work. Yeah. [1:18:39] You alluded to... [1:18:42] or maybe you talked about it somewhere when you first came into the firm, like, [1:18:47] and you were starting to get your feet under you, it's like people come in and they can pick somebody to work with, and it's like all of these legends and like 27-year-old Andrew. Yeah. And then you talked about how you started tweeting and a handful of little things. Like, I'm curious – [1:18:59] to what extent you're sending a bad signal now, how much you care about that. You, [1:19:03] Don't. [1:19:04] do a lot of podcasts. Like, how do you think about the legibility part of it? [1:19:07] Thank you. [1:19:09] Yeah, I think when I started tweeting... [1:19:11] First off, it felt more countercultural at Sequoia Capital than you could possibly have imagined. I was ducking for cover when I rolled into the office. One of my tweets had gotten some people talking about it or whatever. Back then, I swear, I was like the...

[1:19:25] Maybe like the first [1:19:27] actually good poster amongst the venture capitalists, you know, like, um, and, um, [1:19:34] That was the, like, 20... [1:19:36] 2017 era where like who you followed mattered a ton. You could have like real alpha and just like your feed, if you follow the right, [1:19:43] 400 people, you feel like everything was actually going on, none of the noise. [1:19:47] I think almost all content produced by investors is marketing, you know, like whether they know it or not or you know it or not. [1:19:55] Call it legibility or whatever. It's a marketing document. [1:19:59] I think in the current [1:20:01] I think one of the things of LLMs is that you can produce extremely... [1:20:05] in-depth [1:20:06] content in mass about anything you set your mind to. And like, [1:20:11] I think he's like market maps and things are like, [1:20:14] You know, it's useful and it's good. [1:20:16] But I think the thing you're trying to make legible is like, I actually get it. You actually get it somehow. And I think like... [1:20:22] for better or for worse, like [1:20:24] connecting dots that people are connecting, and specifically doing that through humor, is like, I think one of the easiest ways is to like make, [1:20:30] your understanding of a subject area. [1:20:33] Hmm. There's also like a person on the other side of the screen. Yeah, exactly. And one of the things that that Ava always says is that my tweets are like clearly funny to me, you know, and I think the the subtweet is like there's they're not definitely not always funny to everybody. [1:20:50] But, you know, it's like the... He's having fun. I'm always chuckling at my own stuff.

[1:20:57] It's great. You know, it's like, yes, it's like if you're not, if you don't think your posts are good, I can guarantee nobody else does. That's honestly... [1:21:06] More of us would probably do well to remember that. [1:21:10] You have a thing about big days. This is you. There's an old quote called Stone Crudders Credo that describes hammering at a rock 100 times without making a crack. At the 101st blow, it was split in two, and I know it was not that blow that did it, but the 100 that had gone before. I try to remember that. In our work, you never know which days will be the biggest of your career, but if you stay focused and keep hammering, those days will happen. I think this ties a little into when you were talking about not flinching, but... [1:21:38] Either can you give an example of a day like that or just like... [1:21:42] Does that hold up? Is it kind of a string of years and a handful of big days? [1:21:47] Yeah, I was just thinking about this this morning. Um... [1:21:50] We have a young guy on a team named James Flynn who is, you know, similar to Mike Martin. I think James Flynn is going to be well-known in the Valley in 10 years. Still very young and still developing, and his tweets kind of suck. But besides that, James is amazing. And, yeah, James, I remember James brought me to a company meeting sort of in – [1:22:09] 16 months ago and [1:22:11] It showed up as one of five back-to-backs starting at 8:00 in the morning. [1:22:17] And maybe he was the he put it. [1:22:19] before my eight o'clock meeting on Zoom. It was like a Zoom at 7.15 or something. And James had been at Sequoia for less than a year. And the last thing I ever wanted to do was do this meeting. And I remember the feeling of seeing it hit my calendar

[1:22:33] when I was like, night before, and I realized I had to get up earlier and missed a workout, and I was like, [1:22:38] man, I'm like ready just to be annoyed, you know? Yes, yes, yes. [1:22:43] And then... [1:22:45] This is a crypto company that we've invested in, haven't announced yet. It's probably one of the investments I'm most excited about. [1:22:52] And, you know, [1:22:54] Two minutes into the meeting, I was like, James, I love you so much, man. This is so good. And to me, it's a perfect example of some days just show up, and if you're not ready for it, that's a problem. Because it can be a 7-15 meeting that your six-month in his career young guy just brought you to that you easily could have said no to or anything else, you know? [1:23:16] Um, [1:23:17] Hmm. [1:23:18] And similarly, I think there was a day... [1:23:22] I wish I remembered the names. Doug brought in, I think it was Aruba Networks and... [1:23:28] Something else. [1:23:30] Two of Doug's big billion dollar gain IPOs happened on the same Monday partner meeting, and he did memos for both of them. [1:23:37] and have them present back to back. And it's like, to me, that's like the guts of a great investor, right? Like you would love it once a quarter, you had some amazing investment opportunity present itself. [1:23:49] But... [1:23:49] It's more likely like you're deep in the weeds on one next one's there and you got to be up for it. Christmas, whatever. Right. Yeah. And it's like, [1:23:56] Would I be capable of having the work ethic to really evaluate two things in parallel and win those investments in parallel, knowing how single-threaded I get? I don't know. That's why it's like Leone. Yeah.

[1:24:12] There's a view that says... [1:24:14] parts of investing, there's sourcing and there's picking and winning and, and building companies and so on. There's a view of... [1:24:22] and I think clearly some of your investments have shown this is not always the case, but there's some view that says a lot of time in growth, and maybe especially in a firm like Sequoia, like... [1:24:30] It's actually about winning. [1:24:32] when rubber meets the road, sometimes it's like everybody kind of knows the companies. And again, I don't think that's totally true, but to the extent... [1:24:40] That is sometimes true. What makes you a great closer? [1:24:45] The only thing I used to have on my... [1:24:48] Twitter bio, like references available upon request, you know. [1:24:52] I think founders listen to other founders. [1:24:55] Which is why winning your first one is really hard. But once you got it, like... [1:25:00] Yeah, it's like, talk to other people. You know, see what they say. And obviously, you have to meet people where they are. Like, I think you really have to show them that you believe in them and believe in the company and, like, enthusiasm and understanding and, like, a deep belief in them. [1:25:11] is like really important in the moment. [1:25:14] I think in particular, like founders... [1:25:17] I heard this amazing talk, um, [1:25:19] from this guy, Winston Weinberg, who runs Harvey, which is one of Pat's investments. [1:25:25] And, you know, Winston... [1:25:28] was talking about how, you know, like... [1:25:31] It's really important to founders that [1:25:34] they know that you will like [1:25:37] You just go to war for them. There's nothing. Whenever the fight that gets brought to them, you're there for it.

[1:25:44] and [1:25:45] To me, that was like... [1:25:47] the best piece of feedback I could have heard. I think I needed to hear that. You know, he was just giving a, [1:25:51] talk and I was just like in the audience listening. Yep. And [1:25:55] one of the [1:25:57] I think I've always, like... [1:25:58] communicated to founders like I really believe, you know, but I think I'd be even better if I communicated. And by the way, like no matter what happens, like I'm here for it, you know, like [1:26:08] Maybe that probably comes out in reference to Dr. Vlad or Dylan, you know, low moments and everything else. [1:26:13] Like, that's the thing. Like, that is who I, you know, again, who do you want to be, right? Like, you know, I wanted to be the person who, like, you know, [1:26:20] Side by side, shoulder to shoulder. Yeah, we'll rise to the occasion. [1:26:23] What do you think the most common thing is? [1:26:25] that. [1:26:27] maybe the most common praise and the most common criticism that founders who [1:26:32] are referenced on you, would say. [1:26:36] So [1:26:37] You know, [1:26:38] One time I heard that Mahdi from 11 Labs told another founder that I was, quote unquote, low EQ. Like, what the hell, man? [1:26:50] Mahdi, I love you. [1:26:52] I think I immediately responded back to him like, dude, what? [1:26:58] Yeah. [1:26:59] I think I have this cabal of the best founders, like-minded people, really great people. [1:27:07] people like Kevin Kelly and Matt Huang, right? [1:27:11] Ravi and Pat, you know, like, I'm just, I feel like I've just [1:27:13] surrounded myself with these just like exceptional people and

[1:27:19] I think like that's probably the thing that people like are most excited about working with me. It's like, I don't think it's like a personality thing per se. How do you think I'm like, [1:27:29] I show up, I've read the board deck, I'm excited to engage, I love business and debating things and pick up the phone on Friday nights. But I think like, more of it's like just the association with these other people, which is amazing, you know. [1:27:42] And then criticism... [1:27:44] I think there are ways in which I'm a subpar venture capitalist. Like, I don't think I'm... [1:27:48] I feel like if I'm interviewing a [1:27:50] VP product for your company, I am a, you might as well have a, [1:27:55] I don't know [1:27:58] Anybody else interview that person? I'm just like, I've proved myself to be a very like subpar interviewer of specific roles. You know, oftentimes you're. [1:28:05] Asked to go help with. [1:28:08] on the metrics thing. Like I've definitely gotten into ruts where I've like just been wrong on stuff. [1:28:14] There's a period of my career where I was convinced gross dollar attention didn't matter. It's only net dollar attention because the cohorts, you know, and it turns out 2022 just blew that up. And I was like, wow. You know, it's like this. So I get stuck on some things like that. [1:28:28] But I do think people would say I'm loyal. [1:28:31] Low EQ every once in a while. Yeah, every once in a while. I just say things in a dumb way, probably. [1:28:39] Some questions about Sequoia. [1:28:41] Um, [1:28:42] Extreme performance culture. [1:28:44] Uh, there's this like Doug thing about the 10 rule, 10 tenants. And it's like, number one is performance though. Like all the other stuff is cool too. Uh, I'm curious how like an extremely meritocratic environment is both freeing and to what extent you kind of had to be forged through that.

[1:29:02] I think it is... [1:29:04] If you buy in, it's the best product. [1:29:08] possible [1:29:09] cultural attribute you could want in an employer, right? Like where it's, um, [1:29:15] performance, it's obviously in the investment business where your returns are [1:29:20] lagging and it's like there is an element of subjectivity to it but like [1:29:25] I think it's like, if you know, you know. Right now with our team, I'm like, I'll hear about a company, I'm excited about it, and... [1:29:32] David Kahn or Sonya Hwang, uh, [1:29:34] Anthony Huang had [1:29:36] I emailed them yesterday. I feel like it's happened to me 14 times in the last year, where I'm finding myself a step behind my partners on the companies I'm really excited about. [1:29:47] and [1:29:48] That is so good. You know, it's like, that's like, that is exactly how you want it to feel. You know? Yes. Same with Pat. Like when he's, um, or Alfred, like he'll, he'll see something. I don't see it at all. You know? [1:30:00] it's a [1:30:01] Your instinct isn't like, let me... [1:30:03] argue you, it's like, can I explain? Like, just tell me, you know? And I think what it means for people like Isaiah or people like James or people like Anas, which is one of our young guys in London, [1:30:13] It's like, if you can just... [1:30:15] put your neck up there. Like you can just, and like people really want you to win. You know, people want you to succeed. [1:30:20] And then the downsides would just be like, [1:30:23] My golf games are never going to get any good. [1:30:28] Yeah. [1:30:29] you [1:30:30] You talked about a criticism a little bit earlier. I'm curious to the extent you're willing to share the harshest or most effective criticism you've gotten.

[1:30:39] Mm. [1:30:42] Um... [1:30:43] Thank you. [1:30:45] I had a breakfast... [1:30:47] meeting with Mike Moritz... [1:30:50] downstairs in this office. [1:30:51] where, and Mike's somebody who [1:30:55] I think is the best venture capitalist of all time. [1:30:58] And also has... [1:31:01] the best way with [1:31:02] words of maybe anybody in business. Um, and he's somebody who's like, looked after me my whole career and has, you know, done right by me time and time again. [1:31:12] in really low moments for me. [1:31:15] I won't like [1:31:16] share the details of the conversation, but it happened at a very important time in my career where... [1:31:23] I think I was just headed down the wrong track. [1:31:25] Um, [1:31:27] he managed to give me this like feedback in a way that was like deeply cutting and like, you know, [1:31:32] And also... [1:31:34] in a way that expressed extreme belief in what it could go do. [1:31:38] And my guess is at this point, he doesn't remember this moment at all. You know, it was just like giving feedback. Yeah. But I remember that sort of like I was heading down. [1:31:49] I was heading down a path where I was like, [1:31:51] going to be the grumpy, disagreeable I see. [1:31:53] you know, um, [1:31:55] I was kind of in a rut, didn't want to deal with stuff, and I was just packing and do everything. I'm going to do my investments. [1:32:02] keep my ball to myself, you know? [1:32:04] And he totally took me on the other side. [1:32:07] Yeah, it changed my life.

[1:32:11] This is you from some old job posting. Sequoia trees can live thousands of years. Not only that, their wood production, their growth increases as they age. They resist the deceleration and eventual stagnation that befalls most living things. [1:32:25] I think there's a broad sense amongst many people, many investors I've talked to, which is like, how much does what I do even matter? Like, there's like a lot of determinism. The companies are funded anyway, whatever. And my sense is that you and Sequoia in this place have a deep-seated view that this institution is quite important. [1:32:43] Why does Sequoia matter? [1:32:46] Thank you. [1:32:47] Well, first I would say that job posting proves that even pre-LLMs I could write like a LLM. That's uncomfortable hearing that sentence out loud. [1:32:56] Sequoia does matter. [1:32:59] like an iconic institution in the Valley area. [1:33:02] that has such an amazing history. [1:33:05] And [1:33:06] I think Silicon Valley is a place for the history of [1:33:08] really matters. You know, it's like, this is Shockley Semiconductor, you know, all the way through. It's like, this is [1:33:15] we're in this era, right? Like this is [1:33:17] This is... [1:33:18] will probably be in history books and one in which they perform. [1:33:22] And we are standing on the shoulders of like, [1:33:25] you know, Don Valentine and Mike Maritz and Doug Leonie and Jim Getz and Roloff, like, [1:33:30] these exceptional investors who've given so much of their lives to this place. [1:33:36] And... [1:33:38] Like if we're the ones who kind of just like, [1:33:41] let it just fall back into just

[1:33:43] like yet another... [1:33:45] you know, VC, you know, [1:33:47] and the history books are littered with that, like Hummer Winblad. Hummer Winblad was like the hottest VC in the world in the 90s. Like, no one's even heard of Hummer Winblad anymore, right? Like, [1:33:57] So it's like we're not in some ways immune from that, you know. [1:34:02] Yeah, it's like you carry on a deep amount of pride in that fact. [1:34:07] But it also invites lots of criticism. And if you don't do well enough in terms of making investments for the future and talking about the future, it's like you've run the risk of being a... [1:34:17] a fading star, right? Like, which is like the last thing any entrepreneur was a hitch to wagon to. So it's like, we are not going to do that. [1:34:24] you know, and like we also know that [1:34:27] the only way to like make sure that exists is like take risks and like break stuff and, you know, face the embarrassment caused by mistakes, but like also capture a lot of the opportunities that present themselves to us. And they're really proud of the way that our teams operate. Um, [1:34:44] I'm really proud. [1:34:44] Thank you. [1:34:46] And we talked about it with you. You already mentioned the people. Sequoia brings in a lot of young people and kind of trades them in your way, a lot of apprenticeship, et cetera. [1:34:57] So [1:34:57] one of the things that comes up is a... [1:35:01] some form of deep-rooted need to prove something. [1:35:04] And so I think there are a lot of like... [1:35:07] Oh, like classic trope. Like the dad died when they were 14 or like went through something crazy hard or whatever. Um,

[1:35:15] maybe this even ties into your own experience kind of growing up, but, [1:35:19] I'm curious, like, the different ways that that's something to prove can show up, like, the different flavors of that. Yeah. There was this Sequoia Heritage event. Yeah. [1:35:29] In Montana, it was actually, I was there with Dylan. We actually were there when the Adobe deal was going down. [1:35:37] Doug was on a panel with Roloff and [1:35:40] and rave verlath and michael and neil shen and someone asked like how do you guys hire young people and doug was like oh you know he did the thing he always says you know people who are like you know on the surface like really high achieving but like deep down just like real fucked up thing you know it's like we've got this like one guy you know he's got this [1:35:56] He's like a twin brother, and you think he's so normal, but actually, like, deep down, he is more screwed up and competitive and can't lose. [1:36:03] And at the time, I was, you know, now we have a second twin on the team, but it was like, [1:36:08] I'm like right here. Everyone knows you're talking about me. It's like just... [1:36:13] And, yeah, I think that, like, Doug is an amazing evaluator of talent. And... [1:36:18] Yeah, we say people who are hyper-competitive with a heart of gold. That is the entire rubric. [1:36:24] for our growth team. And [1:36:27] hyper-competitiveness comes from somewhere. Like [1:36:31] And it doesn't always reveal itself instantly. You have to really find it in people. Because there are plenty of 4.0 students at Harvard who... [1:36:40] Mm-hmm. [1:36:41] do not have that dog in them, you know? And there are plenty of...

[1:36:45] people who've like, [1:36:47] done so much and achieved so much in the past, you know, come such a long way in their lives. But like, [1:36:53] That doesn't mean they're going to... [1:36:54] succeed into the future. And there's some people who, you know, I grew up in a perfectly normal family, you know, in a really nice house, in a really nice neighborhood. [1:37:04] I played sports. I went to a good school. I got a great GPA. I won academic awards. I won athletic awards. [1:37:10] Like, [1:37:12] that [1:37:12] None of that, you know. [1:37:14] Again, that's Doug's question for me. Why would I hire you? It wasn't about any of that. And... [1:37:20] Yeah, so sometimes people are like, oh, I'm not going to hire this guy. He went to Phillips Exeter. I'm like, you know how many great investors went to Phillips Exeter? Like, that ain't the problem, you know? So anyway. [1:37:32] You mentioned you joined at 23 years. [1:37:35] I think you were one of, if not the youngest Sequoia partner ever. [1:37:40] Um, [1:37:41] How, and again, I think it obviously relates to part of what you just said, but like, how have you managed the sort of like... [1:37:48] Being an early star. [1:37:50] Thank you. [1:37:52] I think the four years in the salt mines, you know, that helped to not feel like I was shot out of a cannon, you know? [1:37:59] But you do Robin Hood, you get that promotion. Yeah, do Robin Hood, which felt like a good investment, and then it felt like a bad investment, and then a good investment, and then you do a few others. I did Loom, I did Figma. [1:38:13] I think the idea of being a star, right? Again, at Sequoia, you never feel like a star. Doug did the whiz investment...

[1:38:21] when he was 64 years old in an Israeli company, [1:38:26] a zillion miles away from home when like he should have been on the beach or playing golf or whatever else. And just like, [1:38:32] for lack of a better term, like, mogs us with this, like, you know, multi-billion dollar gain. [1:38:39] right before he retires. Right, right, right. You know, like that's outrageous. Yeah. You know? Yeah. The barking fire. [1:38:45] You know, I... [1:38:46] Not even eclipsing the bar. I'm hoping to even see the bar. [1:38:52] I think it's probably a helpful thing for me to eat. [1:38:55] ego check perspective. Yeah. [1:38:57] A few... [1:38:58] Sequoia people I wanted to talk about the first a few questions about Don Valentine interestingly [1:39:05] especially in the backdrop of how we started this conversation about founders, is Don's like this market maxi. Even the Stanford talk he gave around 2010, he's basically like, we don't choose people, we choose markets. [1:39:18] Aviso i... [1:39:20] maybe the market has shifted broadly. Certainly Sequoia has changed its tone on this. And so like, [1:39:25] Is it a more balanced view? Is it just that the market piece doesn't need to be said? Has something changed about the world? [1:39:32] All right. [1:39:35] In answering this question, have you read the DTV book? I've read part of it. Okay. [1:39:41] The Sequoia that Don ran was nothing like the world today. You know, like, I think that's one of the takeaways from the book. Like, he did an amazing job building... [1:39:50] to the culture attributes and hiring people and making amazing investments.

[1:39:55] Obviously, like Apple and Oracle and Cisco and Atari, and like Cisco is really his crown jewel. You know, my favorite faxes. Do you know Cisco's fiscal year end? [1:40:05] Thank you. [1:40:06] I think it was July 26th last year, you know, like, you know, like, because Don hated having the, you know, like rigid fiscal year ending at the end of the year, he wanted to do something different. And so like, his legacy lives on in the July 26th fiscal year end. I think it moves around a little bit every year for Cisco. [1:40:22] But Don, like, and I was lucky enough, like, for my first few years at Sequoia, Don was around a lot. And I talked to him a bunch. And he probably... [1:40:30] He knew who I was. Whether he thought about me as somebody who would be a long-term member of the team, I doubt it. [1:40:38] And the thing that dawned on me so amazingly was like, hire [1:40:43] Michael and Doug, and then hand it off. [1:40:45] And that like generational transition, just getting out of the way and letting those two work together and build like the modern sequoia, you know. [1:40:53] all the different businesses, geography, stages, so many amazing things that like, [1:41:00] I think that one thing, you know, getting the big decisions right, like the way that Don... [1:41:06] handed over this partnership. So many other guys have had a pretty successful or even amazingly successful [1:41:11] career and venture capital, and then the story ends. Yeah, yeah, Don, like, that... [1:41:17] I think it's probably like... [1:41:19] If we do a good job with Sequoia into the future... [1:41:23] The idea of being able to like hand it off someday to somebody else and just like know that like my

[1:41:30] my time here worked, you know, and like, I made it better. It's like, [1:41:34] That's like the thing that I think drives a lot of us. Yeah. [1:41:37] which is different than like maximizing my net worth and everything else, you know? Yeah. Maybe on that note, [1:41:42] This might be from the book. Unknown to me at the time was Don's habit of counting the number of times a candidate used I as opposed to we. Candidates who favored the first person were dead on departure. It is from the book, yeah. [1:41:55] Yeah, how does that, it's semantic, but how does that change your psychology? Yeah. [1:42:00] So [1:42:01] You know, it's funny, like the that's so ingrained in like the Sequoia. [1:42:06] ethos that even when you write a memo about investment, you just use the royal we. Writing the word I just doesn't... The only time I ever used it was we were... [1:42:16] When I was working on the memo for Phantom, you know, the Naga Studio crypto wallet, amazing company. It's just like, you know, on the back of some of the meme coin mania. And I just had to like excuse James Flynn, who worked on it with me from like sharing his opinion on, you know, some of these meme coins, you know. [1:42:33] And even then, like Pat just like prints it out in circles, the big I paragraph and is like, I would change this, you know. And I was like, yeah, I know, but I just didn't want to have to. I'm taking the arrows. Yeah, I'm just like trying to, you know, excuse James from having to opine on this topic. [1:42:46] Thank you. [1:42:47] It really is an important thing. [1:42:51] Even in this conversation, I think one time I described Open Evidence or Harvey as Pat's investment. I know Pat's going to listen to this, assuming people actually listen to podcasts and be like, why did you say that? You know what I mean? So anyway. I'm Mike Moritz.

[1:43:04] the two best question askers, [1:43:07] ever, according to Don Valentine, are Mike and Steve Jobs. [1:43:12] What makes a great question asker to the extent you learned anything from Mike about that? [1:43:18] I think from a [1:43:20] legibility standpoint, like... [1:43:23] In some ways, they feel like I learned nothing from Mike because he's so taste-driven, intuitive. Like... [1:43:29] there's no, like, how can one possibly do that? You know, like, obviously you try so hard to learn, you know, picked up a zillion lessons and I'm constantly trying to like, you know, bring them to [1:43:39] In the practice... [1:43:41] But... [1:43:42] He'll ask questions that you just cannot possibly understand how they're relevant to that conversation, you know? And, [1:43:50] pops out the other side and has this crystallized view of the future. My favorite Mike story is [1:43:54] It wasn't even an investment that he did, but like [1:43:56] I guess this predates me, but when he was... [1:43:59] We brought in Yelp for the Series A when it was like, you know, a desktop restaurant rating service. [1:44:05] Mike apparently is the part of me. He's like, someday, someday, [1:44:08] I won't do my Welsh accent. Like, someday... [1:44:11] Every restaurant is going to have a Yelp sticker in their window next to the Zagat sticker. [1:44:15] And... [1:44:17] Like, [1:44:17] Yeah, literally it's in every fucking restaurant. You know, it's like, how does one possibly see that? You know, it's like so random, but so right. You know, yeah. [1:44:28] So yes, but down the questions like, [1:44:31] He uses a method to get the ground truth on a person that has enabled him to pick time and time again through the generation on the best sets of founders, younger and younger and younger. How he does it beats me.

[1:44:43] Also from the book, this is Mike. When I interviewed with Don, I asked three questions and I have subsequently been asked them by countless candidates. What does it take to succeed in the venture business? What does it take to succeed here? And when will I know that I have succeeded? [1:45:00] How would you answer those questions? [1:45:03] Thank you. [1:45:05] I think number one is [1:45:06] performance right so that you know our squirt and tennis the first one is performance second one is teamwork and doug's words if you don't have the first one that and i don't matter [1:45:14] I think ultimately it's like, [1:45:16] This is a numbers game, and... [1:45:19] the numbers catch up to you in both ways. If you're doing a great job and delivering investment returns, eventually you get this compounding [1:45:27] you know, benefit that [1:45:28] reveals itself in a bunch of different ways, and if not, like... [1:45:31] When the tide goes out and you aren't doing a good job, you exit the business. [1:45:36] I think that's true at every venture firm. [1:45:38] So I'll say that's also had a 60-deaf sequoia. I think the second tenet really matters, too, the we pronoun. [1:45:44] teaming on investments. We have two-person deal teams, max, and it's like [1:45:49] not uncommon for [1:45:51] pat to wingman somebody else like pat will be doing custom references and like writing sections of the memo for a [1:45:57] unproven younger guy to go lead an investment. That's so cool. [1:46:02] Thank you. [1:46:03] And what was the third one? When will I know I have succeeded? [1:46:08] Still working on it.

[1:46:12] What do you hope? [1:46:14] Or think people... [1:46:17] ought to know or not forget about Mike Moritz. [1:46:24] I think to the previous question, you know, the, [1:46:28] Ultimately, it's about performance. And... [1:46:31] You put up the numbers. [1:46:33] I mean, he put out the numbers more than you could possibly imagine. [1:46:36] And... [1:46:37] Thank you. [1:46:40] Now he's hard at work trying to fix San Francisco and pursuing... [1:46:44] Numerous other [1:46:45] for-profit and non-profit endeavors. [1:46:48] He can make it happen. That's one thing he can do. He can definitely make it happen. [1:46:52] a few undug, uh, [1:46:55] Doug on an interview with, I think with Patrick O'Shaughnessy, he said, [1:46:59] He's quoting somebody. It's like, it's so wonderful, I can't explain it. It means run away. Cool is the enemy of reality. [1:47:06] Yeah. [1:47:07] I'm curious how you relate to that risk, if at all. [1:47:13] I think the way that Doug... [1:47:17] you know, pursues the business is [1:47:21] far more like [1:47:23] legible than the Mike just somehow coming to some conclusion that you can't... The interpretability of Mike's decisions is impossible. Whereas with Doug... [1:47:34] It's this, like, doggedness, you know? Like... [1:47:39] I mean, I wish people could see Doug winning investments. Like, you should talk to founders who have, like, been on the other side of this.

[1:47:46] I mean... [1:47:47] It is like... [1:47:48] like Mozart. It's unbelievable. [1:47:52] Even better, when Doug... [1:47:54] he would give these presentations of like a [1:47:56] standard Sequoia deck, you know, where a company would come and, you know, explain their business. And when we're visiting them and for the last 10 minutes, he's like, like, before I leave, let me just tell you a little bit about us. [1:48:07] And he would just basically shine the perfect mirror back on the company, like giving them [1:48:13] you know, [1:48:14] showing them in such extreme detail, like how well he understands exactly like their bottlenecks doing it in a way where like he was not talking about them, like, you know, giving them feedback, right. He's talking about Sequoia, but like just nailing every single thing. Um, [1:48:29] And then just the hustle, like... [1:48:32] you know, [1:48:33] flying around the world, never on a never ending basis, just like... [1:48:39] winning and winning and winning and just [1:48:42] You know, amazing leader. Yeah. [1:48:44] Maybe a little bit related to the comparison. Doug described Mike as very intuitive, as you said, and he talked about needing to shift a little bit more that way when Mike stepped down where he had been kind of the process guy. And I'm curious how, well, [1:49:00] to the extent you felt the need to, how have you had any of that? Have you felt any need to become more intuitive? [1:49:06] I think I've always skewed probably more towards the intuitive side. It's by my nature. [1:49:11] I think it was either Roloff or Jim. [1:49:13] Roloff is like 200 IQ, like, you know, just understands –

[1:49:19] everything like extraordinarily deeply to like the nth degree. And then Jim gets is like a networking guy from his previous company. And Doug was like working on some networking thing. [1:49:28] And then at some point, Jim just gets fed up, and he's just like, "Doug, do you know what the company does?" And Doug's just like, "Yeah." [1:49:35] top of the rack that was like the um of course we made like a zillion dollars you know what i mean but like it's um it's like a wild wild oversimplification and very unfair but there is a little bit of the bell curve me here with mike and doug oh but the thing with doug is that like doug is on the right side of the bell curve like the um i'm trying to think of [1:49:57] There's so many brain teasery puzzles where you have to unwrap metal things from each other. Sure. You know. [1:50:03] We wanted these in our office. Someone brought it in. And of course, everyone's spending the full day trying to do this thing. [1:50:11] Doug just rolls in, looks at it for like three seconds and pulls it apart. So to me, it's actually like... [1:50:19] They're both maxed out, but Mike's the maxed out word cell and Doug's the maxed out shape rotator. Nice. You know? And I think that's the best way to describe them. [1:50:27] I guess the same question I asked with Mike, which is what do you hope people know or don't forget about Doug? [1:50:34] I think the new bank investment, he probably was in his late 50s when we did that investment, and it was a seed in a Brazilian credit card company. [1:50:46] having built his whole career, like... [1:50:49] doing enterprise investing, you know?

[1:50:51] I'm sure at various points he felt like, what am I doing? People are going to judge me. Repotted the plant. Yeah, he repotted the plant. The last thing he needed to do was go do that. Yeah, that surprises. Yeah. [1:51:04] keep like Brazilian credit card company, [1:51:07] Like, David, intern at Sequoia, he's a guy who runs NewBank. And, like, it wasn't just, like, a random Brazilian credit card company, you know? [1:51:15] But nonetheless, like sticking your neck out and being willing to look extraordinarily stupid at that. [1:51:20] age of your life and then just like [1:51:22] dominating is that's, that's like the stuff that I think like ought to be in the, like, this is how you should do this job. [1:51:29] I just have a few more things. Um, [1:51:31] More generalized. [1:51:32] What's artistic about business? [1:51:35] I think there's like an extreme... [1:51:38] non-linearity, uh, [1:51:41] across every dimension that... [1:51:44] is like [1:51:47] really beautiful. There's just this way in which it's just not paint by numbers. Nothing about business is paint by numbers. It's so multifaceted and it's changing so quickly. [1:51:59] you know, you can't possibly see the Matrix. You're just like constantly... [1:52:03] Just like, [1:52:04] seeing something a little bit different every single day and try to find patterns, you know, [1:52:09] And [1:52:10] especially in like tech, uh, [1:52:12] the half-life on some insight is, [1:52:15] a year or two tops, right? Because, like, it's crazy to get crowded, right? And I think that's true in our business, too, you know?

[1:52:23] I think that's just so cool. It's also stressful, right? Because like, you know, I can get to the question of like, how do you know you're successful? It's like, if the metric that matters is like net new ARR for a software company, like, [1:52:34] We're only as good as our next investment. That's a line that we end all of our presentation on at Sequoia. [1:52:38] If that's the market that I'm in, the next company, am I that good? How could I possibly know? In fact, I'm late to all these companies. David and Sonia are kicking my ass, and Pat's doing better, and... [1:52:50] Josh Kushner's doing amazing, and Neil Mehta's doing amazing. It's so intense. [1:52:57] Anyway. [1:52:58] You have a tweet, always suspicious of young people who are points guys. Same with tax obsessive. Lack of appreciation of opportunity cost of your attention, which is hilarious, but also, I think, pretty profound. How do you remember the opportunity cost of your attention? [1:53:14] It's a little bit of the... [1:53:15] Don't [1:53:17] you know, don't outsource, you know, it's like the... [1:53:20] I'm also suspicious of... [1:53:23] like productivity obsessives in the investing business. [1:53:28] Just because, like... [1:53:29] I think you have to follow the spark of your creativity and you need to have [1:53:33] you know. [1:53:35] Maybe some people can pull it out, but I feel like the... [1:53:37] You know. [1:53:38] Every meeting has to end on the exact moment of time. Your day's not going to be like that. If you find something you love, you've got to stay in the meeting and deal with the consequences. [1:53:48] I think, yeah, I think, like, dealing and, like, making yourself, you know, this future of, like, the AI future, like, I think...

[1:53:55] forcing yourself to [1:53:57] put pen to paper, I think it's going to be really valuable. [1:54:01] Yeah. [1:54:02] What did you learn studying the classics? [1:54:06] I think you were a classics and economics major. [1:54:09] Yeah. [1:54:10] I don't expect it. [1:54:11] Yeah. [1:54:13] you know, it's a left, left brain, right brain thing. Um, [1:54:17] Yeah, actually looking at this, I won the... [1:54:19] Uh... [1:54:20] Latin prize at Amherst, especially new year. And there's two of us who won it to me. I got him. [1:54:25] Kevin G. I think his name was, um, [1:54:27] Licked him up like two weeks ago, so he was up to, he said, SEC enforcement attorney. I was like, I'm looking at his LinkedIn profile, I was like, oh crap. You know, shout out Kevin. [1:54:38] You know, it's like, I think I learned a lot of the same thing I learned at Goldman, is how to work, right? Just like, [1:54:43] Classics was a grind, you know, just translating every night, pre-LLMs and like pre- [1:54:49] you know, you're just sitting there just grinding with a dictionary and, and you know, [1:54:54] the Old Testament or the New Testament or the Aeneid or the Iliad. You're just like sitting there and just like you left like a mountain of... [1:55:03] pages in front of you and you're like just chipping away at it [1:55:07] Same with, like, working at Goldman. Like, [1:55:10] do I do DCS now? Like, no, it's like, no. Um, [1:55:15] But... [1:55:16] How would I just get up in the morning and prioritize your time and get through it? And when you're exhausted but you need to do something, how do you... [1:55:25] Of course you do it. You know, it's, I think that's like that, how to work and how to like really work hard.

[1:55:30] I didn't learn that until college. I skated my way through. [1:55:33] high school. I decided to take Greek 1, my [1:55:39] freshman fall at Emerson and, [1:55:42] Oh, [1:55:44] You know, anyway. [1:55:45] I think you said somewhere that your favorite book was Dune. Yeah, I love Dune. Why? [1:55:50] you know that feeling getting lost in a story, you know? Yeah. He's just the best. Like... [1:55:57] No messianic aspirations, just being lost in the story. Oh, no. I actually didn't read it until I was a young adult. I read about other sci-fi and I had never gotten around to it. Yeah, I read it a couple years ago. I was probably 24, 23. [1:56:12] And it was just so sick, you know. [1:56:15] Yeah. [1:56:16] There's no reason for it other than just that feeling of when it was over. I was like, damn it. Yeah, there's some mediocre books to go read afterward. Our mutual friend Tina told me to ask you, what is a film that has moved you to the verge of tears but didn't make you cry? [1:56:34] Um... [1:56:40] Is there a film called After Sun? I still haven't seen it, but it's coming for me. Anyway, I don't want to talk about it. [1:56:48] Thank you. [1:56:50] What's your favorite thing about Will that's different than you? [1:56:55] You know, like, [1:56:57] Like, you know, the thing that I would love people to say about me is I'm like ride or die, you know?

[1:57:02] Will is the most rat-or-die person I've met in my entire life, and I spent my entire childhood as a stutterer [1:57:11] being protected by my little brother. [1:57:12] And [1:57:14] Um, [1:57:18] Like having seen... [1:57:19] his... [1:57:23] like career success take off. [1:57:25] And... [1:57:28] Getting recognition for the person that he is is like... [1:57:34] One of the most amazing things. [1:57:38] Yeah, he is the most loyal human being I've ever met in my entire life. [1:57:42] Hmm. [1:57:43] And he's tough snails. [1:57:45] Yeah. [1:57:47] One more thing. [1:57:50] I'd like to read it. You probably know it given that it's in your bio, but I'd like to read, uh, [1:57:55] This excerpt from Island by Huxley. [1:57:58] It's dark because you are trying too hard. Lightly, child, lightly. [1:58:03] Learn to do everything lightly. Yes, feel lightly even though you're feeling deeply. Just lightly. Let things happen and lightly cope with them. I was so preposterously serious in those days. Such a humorous little prig. Lightly, lightly. It's the best advice ever given me. When it comes to dying even, nothing ponderous or pretentious or emphatic. No rhetoric. No tremolos. No self-conscious persona. Putting on its celebrated imitation of Christ or little Nell. [1:58:32] And of course, no theology, no metaphysics, just the fact of dying, the fact...

[1:58:37] of the clear light. So throw away your baggage and go forward. There are quicksands all about you, sucking at your feet, trying to suck you down to fear and self-pity and despair. That's why you must walk so lightly, lightly, my darling, on tiptoes and no luggage, not even a sponge bag, completely unencumbered. [1:58:57] How are you becoming lighter? [1:59:00] I don't have to comment on that at all. That's perfect. You know, it's like... [1:59:04] That's it. That's it. Thank you. [1:59:06] This is wonderful. [1:59:08] Thank you for listening. Before I leave you, I'd once again like to thank Notion for being such an instrumental part of making dialectic possible. [1:59:17] I partnered with them at the end of last year, and it's just been amazing to have more resources and leverage, but also get to bounce ideas off them. [1:59:25] And more than anything, use Notion to make the show better, whether that be research, [1:59:30] before the episodes or going in afterwards, pulling out ideas, lessons, patterns that stand out to me. [1:59:36] And again, you can check out Notion at dialectic.com slash Notion. If you missed it, I also did a little fun Q&A with them on Instagram, talking about how I'm thinking about the year to come and what I'm hoping to build with Dialectic. I'll link to that in the description. Thank you again. If you enjoyed the show, please give it five stars on Spotify or Apple or like and subscribe on YouTube, all the places. Thank you for listening and watching.