Keynote Speech: Tim Draper | SVIEF
9:31PM Sep 29, 2018
Now, ladies and gentlemen. Our next speaker really doesn't need any introduction. He's a Silicon Valley legend. Not only did he successfully invest in Hotmail, Skype, Baidu in the early days he's also a firm backer of Bitcoin and blockchain. While many of you might still remember about four years ago he predicted that Bitcoin will hit $10,000 in one year in three years and he was right and now even in this current seemingly bearish market, he still has a bullish prediction that Bitcoin will hit $250,000 in 2022.
Well, ladies and gentlemen, please join me in welcoming Tim Draper, founder of Draper associates, DFJ and Draper University. Welcome Tim.
Thank you very much. Hello. Oh, good. It works.
It is a great honor to be here. Thank you so much for having me, SVIEF. You guys have been really instrumental in bringing bringing Chinese investors here, bringing US investors to China, bringing entrepreneurs globally. SVIEF is a really great organization. And I think now you are needed more than ever because of this weird trade war that's going on between the US and China. I mean, I, I kind of predicted that it would happen about 20 years ago. But I keep thinking, why are we doing this? We are so much better off both of us, both countries are so much better off if we just open the borders and let all of the information flow back and forth, let the products flow back and forth, both countries will be so much wealthier.
You know, we, I was actually the first Silicon Valley and and venture investor to invest in Chinese companies. And it was great because I was all alone then. And we backed Baidu and focus media and Kong Jong and YeePay some billion dollar may multi billion dollar unicorns. And, and we and I was the biggest proponent of investing in China. And I was saying, go invest in China. And all of a sudden, I'm trapped because I've got a lot of investments in China, I cannot get my money out of China. So that the
Yeah, what's that about, so I can't get my money out. So I can't put money back in. So we've frozen all investment into entrepreneurs in China. So if you're a Chinese entrepreneur, you gotta come here to get Draper associates money. I want that to I want to be able to invest in China again. Please tell President Xi, that we need to be able to freely invest in China and get our money out. And all of these weird regulations and, and currency controls, they're just killing both countries. So let's, I don't know, I we'll I'll I'll see if we can talk to Trump, you see if you can talk to Xi. Let's see if we can make this happen.
Anyway. So um, OK. So the other people I want to thank, I want to thank is Otter. This is great. Sam Liang, is here he is. He he created the software that's building this. And I backed him before. And now I backed him again, with Otter. And somehow he got the SVIEF guys to use the system. But by the way, I use it with every one of my meetings. So you know, either you should say, ooh, I've got to watch what I say in these meetings, or just say, hey, this is great. Everything I say, he'll go back and he'll reread and he'll look it over. But this is an amazing software package. So with that, let's go on to Bitcoin and all the associated technologies around Bitcoin.
This, this world has completely opened up. We, we have all of these, all these things that have happened from the internet, where communications and information and gaming and and all those industries have been transformed, and geographic borders fell. And, and so those were big industries, those are all big industries. And we benefited from all those clever entrepreneurs who created great businesses around those that new technology around the internet. Well, I believe that now we have something bigger than the internet, Bitcoin and all the associated technologies with Bitcoin, I believe, are going to transform industries that are far larger than communications and information and gaming and entertainment. We're going to transform finance and commerce and insurance and healthcare. And I believe that we're going to transform government. And here's, here's my thinking,
For one thing, I've noticed governments are now competing for you. Because if you don't like what one government is doing, you can move to another place. But eventually, I believe that this is going to be that government is going to be part land based and part virtual. This virtual government can change everything because I could potentially get all my insurance, healthcare insurance, my pension, my Social Security, my welfare, all from any government in the world. In fact, I could do it, I could get it from a government that hasn't even been created yet. I had a great experience.
I went the the Prime Minister of Estonia came to Draper University and said, just by instituting digital signatures, we save 2% of our GDP. And then we use digital voting, and all the young people started to vote. And then we used digital identity. And the crime rate went down. And the business climate went up. And then he then he said, and now I'm going to make you the third virtual resident of Estonia. So he gives me a card, and and he says, you are now the third virtual resident of Estonia. And I said, well, what can I do? And he said, well, you can set up a bank account, you can buy real estate anywhere in the EU. And you don't have to set foot in Estonia. And it got me thinking, wow, governments are going to have to compete for that virtual part of government governance. And now they have an amazing tool to do it.
Think about this, we now have Bitcoin, which is truly remarkable. It's not tied to any government source. It's, it's it's untethered, I can I can take down my Bitcoin in any place anywhere around the world. And and so it has decentralized people so that they are not really tied to one place or another.
Now the Chinese government said, No, Bitcoin, it's illegal. And as a response, the Japanese government said, Bitcoin is now a national currency for Japan. So what happens, all those Bitcoin entrepreneurs, all of that brilliance and brains from China is going to go and flow out of China. And they're going to go to places like Japan. In fact, Binance created a billion dollar company in China. And then the Chinese government made what they do illegal. And so they moved, they moved to Singapore, and the Singapore government started to add more and more regulation. So they moved to Malta. And this is an enormous business, I mean, it is a $10 billion business and, and multi 10s of billions and billions of dollars go through that exchange. So government, governments kind of have to wake up, they are in competition for you, for the entrepreneurs and the capital and the and the deregulation of the world. They are, they want you.
And it's interesting, I go around, I meet with Prime Minister of Kazakhstan, he says, Oh, wait, what's, what's that guy in Estonia doing I want to do that too. Malaysia, same thing, they're going to create a virtual virtual government. So we are, we're in one of these amazing times now, where, where some governments are going, yes, we want you we need all of that new technological activity to come to us. And some are saying, I've gotta I gotta push this away, because I want to control you with my currency. And I think the winners of this are going to be the governments who say, I want to open this up so that you can use fiat currency, and they're going to have to sacrifice in some small way their own currency. And I think Bitcoin will potentially be at least one of the major currencies of the world. And that's an $86 trillion market today. So that's going to be a big deal.
So now, I'm going to give you kind of a fun idea about what all these technologies might mean to to a big industry, healthcare.
Okay, imagine this, you take control of your own data. And then you say, Okay, I'm going to put my healthcare records in there, I'm going to put my blood test results, I'm going to put my genetic history, I'm going to put my Fitbit results, I'm going to put my, I'm going to put my what I had for breakfast, I'm going to put where I've traveled, who I've met, all of that information is now going into this one place. Well, there's no way that any doctor in the world can have as much as much information as the cloud does, once you've put all that information into the cloud. So if if you and I both have a headache, one doctor, both of our doctors would just say, Take two aspirin, call me in the morning, everything's fine. But the cloud might recognize that I've been in Fire Island, and I got a tick bite. And the right diagnosis for me is that I might have Lyme disease. And I should be taking antibiotics, multiply this by this 8 billion people on the planet, and all the data from all their experiences and all their health care and everything they've done and and then put that into a, you know, anonymous database and add deep learning to it. And you are going to end up with the best doctor on the planet and a doctor's job is going to be more of a consultative job where they say, Well, yes, the AI doc, the AI doctor said this, but this is what I think you might want to think about. So healthcare that changes everything, and healthcare, the drug companies aren't going to like this. But as entrepreneurs, there is an enormous multi trillion dollar business go after there.
In government, think about this, you can create the perfect bureaucrat. In Bitcoin on the blockchain with a smart contract, you basically have, add a little artificial intelligence and you have exactly what the bureaucrat is, is looking to do, which is provide a safe delivery of whatever the the regulations and laws are of the country. This is this is like magic. So we could start thinking about using technology to make government much, much less expensive. So you know, people in California are all worried about all the pensions they're paying for all these California Public Employees might not have to do that, if all of that were done virtually.
The other great thing about that is you can create a new country up in space or 11 miles off shore or whatever, and you can start providing virtual governance to all of these great entrepreneurs. And it's interesting when I talk to people who are sort of over 35 years old it's okay for me to say this over 35 years old about this generally they say oh hogwash. This, governments are always going to be fiefdoms. They're never be decentralized. They're always going to be us against them. They're always going to be that way.
But if you go 35 and younger, they're saying we are one world. We are one planet. We are all working together to make this planet better for all of us. And we're all going to benefit in an enormous way from the decentralization movement. And that's all available to us now, because of these new technologies.
So I encourage you be bold, do extraordinary things. This is one of the most important times in the history of the world. This might be the end of everything all the wars that we ever have ever had, whether trade war or physical war. These geographic borders become less and less relevant to us and as, as our entrepreneurs continue to make our world better, it's going to be for the whole world. It's not just going to be for one country or another.
So with that. I leave you to whoever your next speaker is but I am so thankful and proud of SVIEF, I before E, that that they are holding this conference at this critical and important time. So go out there. Do something extraordinary make the world a better place.