2021-03-16 🔮 Insights from 2 Superhero Leading Edge Investors 💰
1:44PM Apr 2, 2021
Ben Von Wong
Esther I you know, we're we haven't officially started I just doing some research. I was reading how you were a New Yorker and just never got your driver's license? Is that still your driving status? Are you still unlicensed?
Totally. I'm you know, it's like I've been waiting my whole life for Uber and Lyft. And ultimately, automated vehicles. I wrote a piece for LinkedIn about these two teenagers in 2013, who had reverse engineered their parents car and so that you can manipulate it with a joystick. And they went onto the highway and endangered everybody around them and all the cars that were properly run by an AI and got arrested.
So, hey, James, it's great to see you our other person that we're interviewing tonight, so we got Esther and James in the house.
Hi, Esther. Hi, John.
Thank you for the wonderful interview you did with my brother James.
Oh, I love that guy. Oh, my God. I've had I had one of his books on my bedside table for eight years. And then I got to talk to him in person and he was in the he was in that crazy back room up at the fish market. It was awesome. You have such a cool family, Esther.
I am lucky. Yep.
You really are. I just want to hang out at your dinner table all the time.
And I know Ben built something or helped design something James for your office before we officially start. James, what exactly did Ben do for you guys?
Oh, my gosh, Ben, does anything we can get Ben to do we want Ben to do. He's such a creative, talented, lovely person who really? I don't know. He's just he looks at the world so differently than most people. We got him to say what do you want to build do? And he just came up with all these ideas. And we're like, those are awesome. And then he built them. So it's all over all this art all over our offices in San Francisco, which I unfortunately haven't been to for a year, but it's I'm sure I'm sure it's all still there. It's awesome stuff.
Great. And David Chang other partner in this great to see you. And I know David you're recording this so for those who miss out on it on our website, imaginationininaction.club, all the the rooms will that we're doing are recorded so people can experience it. Good to see David.
Good to see you. I can't wait to hear all the nuggets.
It's like wonder, like wonder twin powers activate Esther and James together.
Well, gosh, when did you and I meet Esther? I guess it was 2002. David hornick introduced us and I visited you in New York.
I would have let's see 2002. Yeah, it was still still doing PC forum and things. Yes,
that's right. I know on Esther's Flickr account, there's a photo James view around 2002. With release 1.0 hat. So she documents that you guys know each other?
Yeah. Yeah. No, it was funny. The story was pretty funny. hornick introduced us us. Um, he was on my board at that point. And I went and I met Esther, on a Saturday on a Sunday. She was at the office in Manhattan. And I told her about Schroeder of our growth charts and whatnot. And you were funny su said, Well, this can't be this can't be and I'm like, No, it is. And she said, How could you be that big? And I never heard of you. And I was like, I don't know. I guess we're just weird. It's all viral. We don't. And so and so you've you've validated with a few people that we were actually that big. And then you had us present a PC forum. And it was a it was a big deal for me. I met Philip Rosedale there. And then I was on the second life board after that meeting for like five years and met Sergey and Larry there. It was, it was I mean, it was awesome. You have Yeah, you created the platform for all of us to to do what we wanted to do with our lives. It was really great.
So hey, James, let me officially kick this off. You guys Welcome everyone so excited about this. For those who are in this room, this is imagination in action series, we aim to curate a powerful weekly dialogue with pioneers and innovation, who are changing the world tonight we have two extraordinary people, two people that are two of my favorite people in the world Esther Dyson, and James courier. They're both investors. So they're both deeply curious people. And they are both changing the world they live in and having ripple effects for good all around them. We will start with a few questions for Esther and then a few questions for James and then our signature element. We will have dialogue between them, which I can't wait for all of us to experience. Tonight is a continuation of great programming in this room. We had Neil hunt 18 and a half year, Chief Product Officer of Netflix. Last week we had again, who was running operations is one of the Chiefs for the NASA or the NASA rover on Mars. She had just come off a shift to talk to us and the president of Tesla. Next week, we're gonna have the CEO of Forbes and shereena Srinivasan, who's a postdoc in Bob langurs lab. Some say Bob Langer is like the Einstein of our times. If you don't know who he is, look, look him up. And that's going to be great. That event and a few people we've secured just this week, David Rubenstein, the CO head chairman of Carlyle Group and a Lincoln enthusiast, we have the Chief Medical Officer of Madonna, the first engineer of Twitter, the co founder, Helen of iRobot, one of the top beat boxers, you'll find out if he's number one yet. I think he was number two. Last time I spoke to him, a longevity doctor. We also have an all American basketball player who's the first NCAA awardee, for the LGBTQ Student Athlete of the Year. We got a bunch of great shows. But today, I'm excited to introduce Esther. Esther Dyson grew up around academics. One of them was Einstein. She went to Harvard at age 16. She started her career at Forbes and then became a securities analyst. She bought a little event that James actually went to and ran it for 25 years called PC forum. She ran from 1982 to 2007. It was a real important years in the tech world. It was the pioneers and early movers and shakers of the tech industry. And many people say it was priceless. Dan Bricklin who said that his visicalc became a killer app of apple. It happened there. Yossi Vardi, I think sold something to AOL instant messaging. And he credits Esther with facilitating that gates jobs Ellison, Katherine Graham Bezos all attended. And Esther was also a very influential writer, she wrote a newsletter. That's something on paper with staples. That's a little pre internet stuff. And it's about ideas and possibilities and solutions. And wired said hands down. Esther was the most important woman in tech. And many people say she's one of most important people in tech, not just woman. She was also chairwoman of ICANN. A big job, but an important time having naming rights for the internet for countries to kind of collaborate. And she's an active investor. She's on the board of 23andme. Used to be and she's very accurate, as you can tell. She believes in transparency and all airship ventures, Evernote, and meetup and she's leading a really interesting Health Initiative in five cities called wellhow, which we'll learn a little bit more. And she swims everyday, whatever city she's in, she's making sure there's a pool that she can get to. And she's flown in space and a parabola playing seven times. And she was a backup cosmonaut. She trained for six months to fly to the International Space Station. And I learned the Dyson name through Star Trek because of Dyson spheres, her father created this. He wrote about this idea of these mega structures that advanced aliens would build around stars as a way to end he said, this is how we can find them. And so I've always loved the the Dyson concept of Dyson sphere. So it's so cool to meet his daughter, and advice that she gives to many people and I've heard her say it and she's given it to me always make new mistakes. And Esther on her tombstone wants the words written. I wasn't done yet. There's still more to learn and to fix. So ladies and gentlemen, the first person we're going to interview Esther Dyson
Hi. I'm just looking at all the people joining who I know definitely kiss and avonlea and Susan solinsky and BJ Fogg Welcome everybody. Anyway, over, just listen. I didn't actually the weightless flights. They don't go into space. They only go about 40 50,000 feet up.
So I want to introduce Alison Sanders. She's the chief futurist for imagination action, and she's the chief futures for a little company called BCG, and billion dollar companies depend on her for advice, and we depend on her for collaboration. She's just absolutely awesome. And why don't you kick us off Allison
You're on mute, Alison.
Oh, John. First of all, thank you for welcoming us to imagination in action. If you just are joining us now we have two fantastic speakers today, Esther Dyson, and James Currier. We're going to start with Esther, then James then questions to both and then love to open it up for your questions, of course, because that's a key feature of clubhouse. So Esther, let me start, as James said, In the beginning, you had a pretty special childhood. You were part of, as he said, such a cool family. How do you think that childhood shaped you? And can you share with us a story that gives us a sense of what it was like to grow up in the Dyson household?
So of course, it shaped me. And it shaped me rather a lot because we lived in this academic enclave. And, you know, unlike a lot of kids, I didn't necessarily go play with the neighborhood kids after school because they were mostly other academics, kids, but they weren't my age group. And some of them were speaking Turkish or Japanese or something. So I read a lot. I used to do my homework in a tree. And I mean, it was it was a great childhood I wanted. I was kind of determined. And so I wanted to live in England for a year when I was 13. Someone had been talking about student exchanges, and I ended up doing that stayed with a family that my father knew in England, but you know, I mean, they were great parents, they sort of said, Do whatever you want. But you have to take responsibility for the consequences. And the reality is, they were so sensible, I wanted to run away, because I thought that was kind of cool and neat. But there was never anything I couldn't really complain about. I mean, there was no reason to run away. But I did finally leave. The summer I turned 16 to go to college. Basically, my dad and my mother were both scientists, and we both we all say curiosity drives me my entire career has basically been an education, man. You know, everything from working on Wall Street being a fact checker for Forbes. The board of 23andme taught me that genetics. The space stuff obviously taught me about space. And the space training also taught me about Russia. And now I'm learning about health and healthcare at Wellville.
Great, thank you. I'm just looking around the room and I see the Michael Jordan of accordion, I see Robert Waldinger gave the 10th most popular TEDx talk. I see Mike Federle who's the CEO of Forbes, who's actually next week speaker so we have a bunch of good people here. So yeah, that's where you started your career, Esther. So next question, given the title of our session is imagination and action. We would love to hear more about your experience serving as a backup crew member for the International Space Station mission in the spring of 2009. What did that experience teach you about being in outer space? Did it increase or decrease your desire to spend more time in space? And what was it like being Yuri Gagarin's, you know, complex or whatever, in in the Soviet Union or Russia, whatever. It was a deputy Yuri
Gagarin, Cosmonaut Training Center. It was great. I, I had it precisely because my dad was involved with space. I thought, yeah, you know, somebody's already done that. And I figured it was kind of cool, but not that interesting. And, you know, technology and computers, intrigued me more. And then around 2000, something, it became pretty clear that space had really kind of stalled. I'm invested in zero G, which did the weightless flights and in Space Adventures, and this was after, towards the end of when I was doing the newsletter, and I kept telling Space Adventures kept saying, Well, you know, we know you can't afford the $20 million to actually go but you could be a backup for a few million wanting to do that. And I said, Yeah, you know, I will, but I'm kind of busy now. And I was having this amazing life. I was investing in startups that was going to rush every two months. I had been on the board of ICANN and was interested in policy discussions and so forth. And then one of my sisters, I would never tell the story if she wasn't still alive and flourishing. I ended up having a double mastectomy. And a month or two after that I was on the phone trying to arrange something this is kind of like now where there's no friction and you have meeting after meeting every half hour. And I had a conflict. And I thought, well, you know, if I just had a double mastectomy, I could cancel. What. And that's when I decided I needed a total break. And I got in touch with the Space Adventures people and said, when's the next opportunity to train as a backup? And it was for Charles Simoni, who had long ago written Microsoft Word for Microsoft. And they said, you can start in September. And yes, my little room in the dorm did have internet. So now, the context is I'd been going to Russia since 1989. I speak Russian. And so I knew I knew a lot about the emerging computer startup culture there, I didn't really know that much about the government or Soviet Russia. And so the purpose of this was, was both to learn about space and to learn about Soviet Russia, which, of course, had in theory ended, you know, around 1990. But in practice, the government still had these habits. And the Yuri Gagarin Training Center was actually a government that needed a pass to go in and out. And there were some interesting experiences where ice kind of sat at the bottom of the back of somebody's car to sneak out once of I was supposed to be in quarantine. And I went to London for that weekend. So basically, you learn space plumbing and space medicine. And it's, I mean, it was six months, I can't sort of explain the whole thing, but it was, it was wonderful. And I had this lottery ticket attached, which was, if for some reason Charles couldn't go, then I would have the right to buy a ticket in his place. And of course, if that had happened, fairly close to the launch, I might have been able to negotiate a good deal. But that never happened. And
did you think of Tonya Harding him?
No, I did not. I, he had recently been married. So I thought, wouldn't it be nice if your wife said just you let that lady go and stay you stay home with me, darling, I'm pregnant, and never happened. But this is ironic when you think about the risks of space travel, and oh my god, that's so scary. He ended up being bitten by a rabid dog on campus and had to go through the full 14 shot regime of rabies treatment. But that was in November, he was he was quite fixed up well in time, sort of in December, and the launch rates are falling much. And for what it's worth, my father and brother and stepmother came out for that launch. And that was actually the first time my dad had ever seen a live launch because NASA kept inviting him. But NASA keeps scrubbing lunches for weather. So it was a pretty magic moment for the family.
James, I can't resist asking you because you're quite the adventure. I mean, would you be ready to sign up for either the the full $20 million ride to the space station or being a backup?
I think it's 40 million now. But yeah, would you do it? James?
I probably wouldn't. I think that there's lots of great things to do. And I could probably spend the 40 million on people who need it more than I do. I think we've seen enough movies and I have enough imagination. And I've got good friends like others who have gone up or will go up and do something I need to do.
What if were free?
Oh, I would totally go.
Oh, okay, great.
Well, I'd love to go
Maybe we could arrange it.
It's such a privilege. But I yeah, I feel like I've already been too lucky in my life. I don't need to take that luck. And I could use the resources elsewhere.
And that's a great point, Esther. I mean, you've now had multiple experiences. Is it like we see in the movies. I mean, it did Matt Damon's experience reflected all what your experience was.
Well Matt. So the purpose of the training is by the time you've been to the training, it should, it should seem familiar to you. They want it just you go through these simulations, you have to learn the location of every electrical outlet. And I said, Well, you know, I'm an American white, you just paint them red when they said, Oh, no, no, you have to memorize this. Anyway, when I watch movies, the first feeling I get is, hey, I've been there. The way you know if you watch a movie in Paris or London or something and then I wrote No, no, Esther you haven't been, you've just pretended and simulated to be there. But it really does make it feel familiar. And there's, you know, they're very good simulations you get with both the, the that they rotate you. And then there's the centrifuge. So I've gone up to eight g in the centrifuge, which is actually a lot of fun. The rotating one where they try and make you lose your lunches, not so much fun. But the very best simulation is actually in a place in the Netherlands, just outside Amsterdam, Desdemona, it's called, where it's a combination of sort of virtual reality, and sort of a centrifuge thing that moves around. Before I went through this thing, they had this questionnaire, How close do you think it is to reality, and I checked, three out of 10. And after going through it, I checked eight out of 10, it was just really amazing. So you, you learn to be familiar with this. I mean, the reality is, if you're a space tourist, they don't want you to die. Because that would be really awkward. And they don't want you to mess things up to interfere with operations or, you know, pull the oxygen plug when you shouldn't, or something. But aside from that, it's not like you're actually a pilot, you just need to keep that in the pilots way. So you learn a ton. It's like learning music, but you're not the conductor, you just sort of watch the orchestra. And make sure not to trip over the music stance.
I love that, Esther. So I mean, as john said, since this is about imagination in action space seems like a good place to start. And, as you mentioned, you've invested in x core, zero G, nanoracks, Space Adventures, Mars One and constellation services. I'd love to ask you a question we asked again, last week, when you were there. How do you see the space race shaping up in the next 15 years? Which countries? which companies? Do you see as leading space in the next 15 years? What are the challenges in space that most excite you? And personally, I'm curious if you can explain a bit more about asteroid mining and why that seems to attract investors.
Okay, um, that's, that's a lot. But so first of all, let's see, just the fact checker me wants to mention that neither x corner constellation services is still around. And, you know, honestly, one of the big challenges to space companies is, there's still a shortage of management talent, as opposed to engineering talent in the space business. And, you know, Elan Musk is incredibly lucky to have Gwynne shotwell. There's, you know, a lot of billionaire space companies that are more, you know, they're not really run by management, they're run by an individual, and that's gradually changing, which is good. So, you know, then there's, like, the usual things blow up and things don't work. space elevators still fascinate me. But in terms of countries, I put a lot of face still in the US simply because it has a commercial space program that's creative and innovative in a culture. But I was just talking with a friend from Romania today and the biggest IPO in Europe, I think I whatever, UI path, which is about to go public, or something is the remaining companies. So you know, don't don't underestimate what the other guys can do. But space travel is a large industrial complex kind of thing. It's it's not a clever AI, engineering kind of thing, even though the clever AI will make it better. Certainly the Chinese are beginning to do a lot of interesting things, and we should be paying attention to what they're doing. But I still think the I'm still a fan of the American competitive spirit, even though if you asked me about Silicon Valley and exponential growth, I would go into a diatribe. I don't know which of your questions I forget, or was that kind of what you needed?
I think it was great. Let me go on to the next question. You've had a front row seat watching the Personal Genome Next revolution take off, you sat on the board of directors of 23andme, you're serving as one of the first you served as one of the first 10 volunteers, donating your genome to the Personal Genome Project. Can you share with us how you see this field evolving? What is happening to data privacy? And who's making money? And what do you see as the top breakthroughs? Hit the personal genomics field the next 15 years? What do you What did you personally learn from having your genome sequenced? And I predict that 100 years from now, when people think 2001, they'll think of February and have the genome was decoded, not just 911 as a big event?
Well, first of all, just for what it's worth, I donated my genome to the public. It's on the PGP site, as are, by now many others. And if if you want to look at my entire genome, you're welcome to it's it's up there on the website. And that's sort of the point of your genome isn't as interesting, as many people think it is, we're learning a ton. But you know, I'm much more private about my behavior, than I am about my genome, my genome just kind of tells you the materials with which I was built, and maybe a little bit of the architecture. But it doesn't really tell you what happened after I was born in what I did with what my genome gave me or what my environment and fluids influenced me to do. I may no longer the board of 23andme, but I'm a very happy shareholder. And they are also going public shortly, which will be interesting. So what did I learn about genomes? It's, it's as if your genome is a Russian novel. And right now all we have is like a little Russian glossary. So you can pick out words. And sometimes you can see things like, diminishes, risk or increases risk, but you, you can't really read the whole model, you can't get the whole structure. And obviously, we're, we're rapidly increasing the size of that glossary, but it's, it's still a glossary, it's not really a full dictionary. And so, you know, you can find things out and you can certainly, you can determine someone's identity from their genome, but you only their identity as distinct from other people's identities, you can't really determine what they are. And I think people are way over excited about, quote, genetic privacy versus other kinds of privacy. Again, my bank account is something I did something, I own something I influenced my genome, I was born with it. And that doesn't mean that I dismissed the privacy concerns. But I think people, it's like in the Middle Ages, if you, if you saw your face in a mirror, there was this myth that the devil was behind you. And sometimes you would see him because seeing your face in the mirror was so unusual that, you know, you might see it and reflected upon occasionally, but the quality of stuff just wasn't that good that you could really see your face in a mirror that often unless perhaps you were a king or something. So 23andme itself is actually very devoted to privacy and to informed consent, and so forth and so on. There are some other companies that work that will work with law enforcement in a way that 23andme basically does not. You know, you can be identified by your fingerprint, as well as by your genome. So I just, you know, anything new is scary. There's a lot more interesting issues around privacy around various other kinds of medical information, including things like, how much alcohol you drink, or, you know, stuff like that, that frankly, I'd be much more concerned about having out in public. And then there's the whole idea the guy thought was my dad wasn't actually my dad. And you know, it's not that this whole issue is not real. But I think it's it's gotten too much play and I think they Like the kind of data Facebook collects, have gotten too little play, because with the data Facebook collects, you can do a lot of manipulation of people's psychology. And that, to me is much more scary than a lot of the other stuff that's going on here.
That's a super Aster. I love the image of your genome as a Russian novel. I'm going to keep that with me. And I'd love to ask you one more question before we turn to James and, you know, can't wait to hear his thoughts. But it is you mentioned in the introduction, you made a major bet on the nonprofit wellsville. The idea that through long term thinking and planning, you can improve equitable wellbeing in five very diverse communities. I would love to hear you explain a little bit more about how well bill works. I think most of the people have heard of it. But just a little bit more background, what made you want to invest in that space, and what you believe will be critical to succeed?
So well, will is I mean, you can, it's definitely an investment, but the return doesn't come to me. It's it's a nonprofit, 10 year project, and one of our team members, Marvin avillez is on the call. It's a 10 year nonprofit project. And it's not a bit in the sense of, you know, when you bet on something, you bet it will happen. And you watch and wait. And this is more. Like I'm not the CEO, I hired a CEO, I'm a full time team member, I work in the community of Muskegon, Michigan, Marvin avillez works in Lake County, which is north of you guys in San Francisco, most of you probably don't go north of Napa Valley. It's about an hour north of there. So what is it, basically, it's kind of a giant coaching project. We don't charge the communities, they don't pay us and we don't actually have contracts with them. So it's it's one of these ideal relationships where both parties have to want to make it work or they can walk away. And that that creates a dynamic where we need to give them useful advice. And we actually did dump one of the communities because they wouldn't respond to our phone calls and didn't seem to value our advice. And we didn't want to pretend it was working. But that was the whole thing started in 2014. It ends at the end of 2024. So we didn't, it wasn't a nice white lady from New York with a lot of tech, who picked five communities. It was me and our CEO, who used to work at Cigna and sort of understands public health and health insurance and you know how the system works. Whereas Marvin and I are more disruptors of the system. We put out a call for applications got 42 communities of under 100,000 people to apply to our amazement, in the summer of 2014, we went and visited 10 of them, which, as I mentioned, right in the beginning, my life is really one way or another just a series of educational episodes. And that was that was a pretty amazing summer. So what we're trying to do, we don't bring them fish, we don't teach them to fish, we're trying to help them build their own fishing schools to think long term to build sustainable institutions. So in kind of in the mid 2010s. People began to notice addiction is not just something that happened to poor people in the urban, urban poor neighborhoods, but it's something that was also happening out in rural America, Angus Deaton and in case wrote the book, deaths of despair about opioid addiction. And I began to sort of pay more attention to this. Then there was Facebook, which people said people are getting to Facebook and getting addicted to Facebook. I thought, what a clever metaphor. But then I began to realize addiction is really a behavior thinking pattern. It's not about a substance. And all that leads to in these communities, the community organizations are addicted to short term grants. They, they need the money. They fill in the applications for the money if somebody wants to fund the high school program for senior science great or if it's knitting for old ladies or a Diabetes Prevention Program. They'll do it until the money runs. out, and then they'll go look for another grant. But there's never, they're not building anything sustainable, and they're not doing it because they want to do it. They're doing it because someone's dangling some money in front of them, then what we're trying to do is sort of the opposite. We're trying to help them develop their own purpose, build their institutions, we're trying to get them to work together to do things rather than compete for grants. And as I said, we're coaching them, they, they own the ball, they own the court. And when we leave, they will own what they have built for themselves. And it sounds kind of vague. It's it's actually very concrete. And I know more about local Muskegon politics than you could ever imagine. So we're in there, but we don't want anybody's job. And that way, we can give them good advice without our motives being suspect.
Great, Esther. Thank you. So just so you know, I'm now going to switch to James Currier. This is imagination action. I see my dad is here. I don't think he's figured out how to do a headshot. So it's just as JW I see Dana, who's a future speaker, venture capitalist is here. See Lee Liana, who is a stage four lung cancer survivor and has a lot to say about that. She's a future speaker, Dan Daniel. The le Rizal, Executive Director of his foundation is here. We got a great bunch of people. So I'm excited to introduce James career lifelong learner growth junkie. He thinks big thinks where the world is going. He has a big heart. He grew up in New Hampshire at the end of a dirt road. His grandfather created the baseball pitching machine. James I think has tinkering in his bones. He created a hovercraft when he was in high school and, and drove it over water. James started a bunch of businesses, I think at least a dozen before he was 16. a sampling of them. Worms had to do with worms, candy, boxer shorts, a loft business. His cousin told me he got precious metals out of TVs to buy comics, the kid was resourceful. It comes from a family of teachers, his dad, including in addition to being a French teacher was a self taught craftsman who built barns if you need a barn, he's, he's around. When he graduated from college, he went off to Beijing, he sailed across two oceans, the Atlantic and South Pacific. And then he moved to Boston. And that's where I was lucky enough to meet him. He was like Fonzie, it was just awesome. We organize parties together, we both love bringing people together, neither of us drink. So that was kind of funny, we would throw these big parties with alcohol. There was a funky formal and the capital venture, gathering a lot of people, you know, still refer to those events. Even though James, you've moved west. And James also, when I asked him to teach an apprenticeship to some middle school kids, you not only recruited his colleagues, you got a bunch of VCs from other firms to do it, too. And then in the late 90s, you were at Business School, thinking about eyeballs and, and how to how to create an epic company. You created emo. And I remember, you know, watching you brainstorm with the perfect name would be Soon it became pickle. And it grew to be the 18th most popular website online and 100 50 million users. And it was a pioneer of user generated content. And you were really democratizing access to personality tests. You can figure out what dog you were and improve your lives. And if anyone's wondering, James is a golden retriever. You have a love of music, you're part of the Richter scale down in San Francisco, which had a hit, here comes another bubble that went viral. And then your co founder of n effects, which is built on the network effect, and it's an amazing firm you back great companies, but you're also curating really important content to help on the entrepreneur community. And we're really proud to have you and and excited to hear from you. So James, first question. You started more than 16 Enterprises before you were the age of 21. What is it in your family heritage in your personal DNA that created such an entrepreneurial drive is a part of what explains your passion for backing and supporting networks of entrepreneurs?
Well, thanks for having me, john, it's, it's always good to be your friend over the last 26 years or so. Um, so look, I think, you know, Esther's family is certainly more futuristic than mine. And, but my family was a bunch of entrepreneurs and teachers. So everyone in my family is a teacher or an entrepreneur, and we were tinkerers, we're builders, we're makers. And I just grew up playing out in the garage building stuff, whether it's ever crafts or vans or, or boats, or treehouses, or whatever. And so it just was part of what we did and we didn't have any money. And so every, every dime I had, I had to go earn. And so that was a real blessing. This I knew that that's what I could do and needed to do and, and so I just was constantly figuring out how to make that happen. And it's really kind of a sport. You know, it's, it's about the creativity of it, and the fun of it. And feeling alive while doing it and doing it with other people. That gets me up every morning. So that's, that's sort of been my whole history. And what's interesting is No One No One mentioned this to me when I was in college, even though I was in college, I started four different businesses, and no one said, Hey, dude, you're, you're an entrepreneur, you should go hang out with the entrepreneurs, wherever they are, it didn't occur to me until I was about 29 or 30. So took me a while to figure it out that I was actually not like everybody else. And I guess, because of this entrepreneurial, and teaching DNA I've got, I'm really spending a lot of my time coaching, right? I mean, as an investor, now, it's mostly about coaching, talking to people seeing where they're at understanding where they're at understanding where they're going through, and then helping them see their way to the next level. And that's, that's the real joy of
James, it sounds like you're an entrepreneur, before entrepreneurs were on the cover, or, you know, anywhere in Inc. magazine, or, or features, but you've developed such a differentiated style of investing at NFX, which I'm sure everybody knows about, but it's a venture firm that's transforming how true innovators are funded. In what way do your screens and approach differ from other investors? And how did you evolve this approach?
I think, you know, like, like with Esther, I think there's a lot of commonality and looking to build the future and looking for great people. And, and those things, I think if there were some things that I would point out that might stand out as different, I think it would be the way we look at someone's personality, someone's psychology, their spirit, like how crazy are they, you can't be too crazy, but you do need to be a little crazy. And finding that right Goldilocks zone is kind of important. We I do have a 49 point checklist that I go through when I'm meeting with founders, just to remind me of those attributes that tend to help people do better. And, you know, you know, I don't expect founders to have them all. But it's just a reminder for me about the various things that we have in our psychologies that help us be just weird enough, and just crazy enough, so that we can hopefully be successful. And, of course, that list of 49 things gets longer all the time as I learn more. And I guess the second thing I would point to is that we do really look for where we can add network effects to the businesses that we're looking at. And that's why we named the firm and effects for network effects.
So James, just building off of that you're famous for describing investing, based on the network effects that you have said, is responsible for 70% of the value created by digitization? What are the companies that you think illustrate the most powerful examples of the types of network plays that you have discussed? Is this a source of advantage that applies to each of us to individuals to governments? And to non corporate entities? Does knowing the power of this effect change? does it impact how you raise your four kids, and I know they're all boys in one's going off to college, so you must sad.
Wow. I love it the way you throw it eight or 22 questions at the same time. So number one, yeah, the whole thing about 70% of value in tech being created by companies with network effects, we, we basically looked at, you know, the hundreds and hundreds of companies, which got to be worth a lot like over a billion dollars and, and then looked at whether they had network effects at their core or not. And if you actually put on a spreadsheet, and you spend the hours sort of tabulating the valuations of all the companies that are reasonable valuation for each of the companies, you do find out that if you add up the market caps, and you don't include things like Microsoft even because even though they have a network effect, they were before the internet, we just wanted to see, you know, what percentage of the market cap of tech had been created since 1994. When the internet started to emerge. You don't include Microsoft, you don't include an Amazon because Amazon is mostly a scale effect, you only include a portion of Google and Apple's market cap, even if you make all those allowances, you still end up with about 70% of all market cap and Tech has come from companies with network effects at its core, that was kind of a revelation. to us. It's not surprising once you think about it, but it's it's a revelation. And you know, the companies that that we all know and talk mostly about have network effects that their core and there's something odd about them. There's something fascinating about there's something scary about them. We're not, we're not quite sure what it is, but I can tell you, it's probably the network effect that everyone has a sense of, you know, so, you know, you think of Bitcoin, you know, this this thing has a big network effect has a belief network effect, this ecosystem sort of platform network effect. And it's just this rolling. Just like gold has a network effect around our belief around that there's nothing there other than just belief or a Craigslist You know, I use them as an example, because they're still rolling there. You know, a lot of people still use that we've hired a lot of good people at end effects through Craigslist still in the last few years. And they haven't changed their their product, they haven't changed your interface since about 2001 2002. That's how durable these network effects are once they get going. And that's, of course, a two sided marketplace network effect. And then Microsoft, right in 1976, they end up with this platform network effect. And they're still here, what are they worth 700 billion still, you know, a trillion, they're going nowhere. So many tech companies from 76 to 90 are just gone disappeared. But not that one, because they have a network effect. Or you look at a company like monster.com, another two sided marketplace network effect. And you've got employers and employees on the two sides. And this is a company that was horribly managed, went through bankruptcy, and is still doing $700 million revenue a year last time I checked. So anyway, incredibly durable businesses, once you get these things going, Whatsapp, Facebook, all these things, have these network effects. And I guess the other question you asked was, you know, can we use these network effects for ourselves as individuals? Yeah, you can, you can use them for yourself. I mean, I think the important thing to think about is really about how you are part of a network, not necessarily that you you build a pet, or watch how the networks function in your life. And we've written a blog post called your life on network effects, which has been pretty popular in the last couple years. And it basically walks through the seven different stages of your life, seven different decision points, which shift, often shift the network's here and you know, as their heads off to Russia, and she builds out a whole new network of people she's now connected to they, they basically put a lot of new information, a lot of new ideas on her dashboard right in front of her as she navigates her life. And while we all have free will and navigating our life, we really are just having freewill on what information is on our dashboards and the information that's there come from our networks. And so once you start to see those networks at play, and how your life has gone so far, and how it will go forward, I think people will start to have a much better control of how they navigate their own their own lives. And you asked about whether I changed to four kids. Yeah, I've shared this blog post with them. This this essay I wrote, and we talked a lot about it. We I, you know, recently one of my kids, you know, chose to go to pally with 500 kids in his class, versus going to a private school with 75 kids in his class, because he said there's a bigger network at Valley. I'm gonna meet more people, when I leave, I'm gonna have more alumni to help me get a job. He's like, he was 14 years old. He got it, he understood how these these networks work. So yeah, it totally affects how, how I raise my kids.
That's the coolest example. James. I mean, I love that idea. First of all, you know, a recommend to anyone who hasn't seen it your life on network effects. It's, it's fantastic. And in a fast changing world, I think, thinking about what comes on your dashboard and having a network so as you suddenly hear about NF T's or Bitcoin you kind of have someone to call is key. So what do you think that smart people completely failed to understand about how innovation and successful startups work in the US? I mean, what is it about Silicon Valley and other locations that explain the very large concentration of successful startups from those areas?
I don't think people completely fail. I think people kind of get it, I think, you know, any creative industry, whether it's film, or finance, or politics or tech, right. So, you know, LA, New York, DC, Silicon Valley, it's done in the network, any creative industry, it's all done Broadway. Right? I mean, you know, they talk about all the all the violin makers in the 14th century in Italy, who all shared information, these, you know, their, their cultural protocols, which get established within these networks of people. And that, and that all of these creative industries, none of us do it alone, you know, this, this idea that it's just us doing it is just not right. You know, when you have when you're in a creative industry, and you have to make 25 or more decisions per day, you are only as good as your network. And if you can connect to a network, and maybe the internet is now changing, you know, using clubhouse and zoom and other things, we're going to be able to really change the nature of networks as being attached to geography, and it'll be interesting to see how much that changes. But I think, I think that's what people don't really see people say, oh, we're gonna, you know, get a bank in here. And we're gonna put an incubators here, and we're gonna become the Silicon Valley of France and the Silicon Valley of Russia or the Silicon Valley of Japan. It just doesn't work because you're not actually getting the minds of the people that you're not you're not trans translating the cultural protocols that make these images. Trees work in the way that they work. And so I think I think that's what they missed, I don't think, I don't know, people started to see that. That networks and density and geographic concentration can help in these creative industries. But they haven't really seen to the cultural protocols that exist within these networks, and then seek to replicate those ways of thinking basically.
Great, thanks, James. I see. So I see Robin Chase is joined founder of Zipcar. And I knew Esther, you were one of the early investors and really believed in her and I see Tom Gruber also joined the CO inventor of Siri, and in two weeks, it will be one of the guests show. So my next question is to you, James, love your motto for an effects? You say? See what others do not. Can you explain where you go? And, and who you talk to, in order to stay in touch with the cutting edge? Can you give us a sense of how you curate your network to see what others do not? Or is that a secret? And I should we should go to the next question.
You just talked to Esther. That's what it comes down to. Now. Look, you look. Okay, I had a guy come to me from the east coast from I think BCG. And he said, How and I don't need to go after BCT. But he said, he said, Who do you talk to, to keep on the cutting edge of what's going on. And I was standing there with my partner, and we didn't my business partner, and I didn't really understand his question. And it took me literally like 45 seconds to realize that the way this person saw the world is that you have to talk to other people who are having the creative ideas, and that helps you stay on the cutting edge. And in fact, what I was realizing is that, you know, when you know a person like Esther, when you know, a person like Pete Flint, they're the ones who are coming up with the ideas. So you're right there while you're having lunch, or you're driving them from the airport. And they say something, and they're just, they're inventing it on the spot. And so I just, I guess, I moved out here 21 years ago. And, you know, had a nose for finding my way to things like PC forum that Esther ran, which really was the center of the universe of the tech world for a long time, I don't know. But if the millennials know that, but really, it was, there was only one center, it was like Rome, for tech. And once you get into those environments, you just start having conversations with people and you gravitate to people you love. And and I think what's going on right now with tech is, is there's this money culture that's invading, and it's ruining the whole thing. It's ruining the whole experience. Because the real experience of this is to focus on curiosity and creativity, and to focus on the products and to focus on the users. And yet, most people just talk about money these days, in the last 568 years, you know, it gets backs and you know, it's like money, money, money, like who you know, can't focus on money, it's not about the money. And, and it's about the creativity, it's about the people. And so if you focus on spending time with people you love, who are creative, who light you up, who blow your brain out every 20 minutes you're talking to them, then that's how you stay up to date by just being in those rooms, and then create co creating with them. So that it's it's, it's supposed to be played supposed to be fun, right? The Silicon Valley has gotten so obscured by the money culture doesn't need to be that way. Clean should be the hobbyist, the quirky, the curious, you know, it's, I'm just trying to stay in a state of play and creativity. That's, that's how I approach
so so let me so now we're gonna move to next phase where we're going to ask questions that both of you are going to take. So both of you are investors. You both we shape very cutting edge fields, but you have different models for investing. So how would you each describe your investing philosophy? And what do you look for in choosing the sector's deals and individuals you choose to invest in? Esther, do you want to take that first?
Sure, but I do want to just push back slightly on the whole Silicon Valley exceptionalism. I'm glad you started talking about too much money and too much focus at the end. But it's also pretty blind. I mean, this whole culture of abundance is pretty blind, to the fact that more than half of kids in the US are born eligible for Medicaid. And it's, there's, there really is a different world out there. The people in Silicon Valley are lucky and privileged, and mostly white or Asian. And they they do talk to one another, but they often don't talk to their janitors or the all the other people who live even in Silicon Valley and I'm not going to go into a whole rant but just don't forget it. As an investor I am I invest my own money. So I can take a lot more risk I don't need. I lose money all the time most investors do, but I consider it part of the cost of my education. So I invest in things I love, like 23andme. And you know, some of them turn out very well like 23andme. And some of them not so well, like XCOR aerospace, which went bankrupt. And it probably learned a ton from 23andme. But I also learned a ton from xcore aerospace. And the the ability to do that without having to apologize to people when, when the things don't work out is it's it's a privilege. I mean, as James said, you want to be curious and explore. And if you run a large fund, there's a point at which you become more risk averse. And a lot of the larger funds invest very late stage. And they get really good valuations because they add cachet to a company. And it's, as Jim said, it becomes all about the money for me, it's, I mean, I need to make the money so they can keep investing. But it's, it is fun and creative, and exactly what he said. But I don't think it's going to be limited to Silicon Valley. And people like Steve Case at owl, are trying to bring a little more of that culture outside of Silicon Valley.
Super. So we've got many more questions for both of you, but quite a few of you have your hands up. So I'm going to go to David Bolton
Hey, can we get Yeah, can we get? Of course. And then do one more question to both of them? Sure.
Yep. Yeah. I mean, we, some, I was an angel investor, like Esther for a long time, while I was running my companies, and then did about 50, angel investments, mostly in software, mostly just through through friends in Silicon Valley in New York area, and then decided to start my fifth company, which was this venture firm, and really tried to start it as a software company, and a media company, and where you monetize through investing, and we also made the decision that we were going to take outside money, and I love that Ester investor on money because it lets her have a particular style to our investor investing. And we were attracted to that. But in the end, neither right nor wrong, we just decided to go a different route in order to build an institution, we thought it would be fun to, to try to build a brand, build an institution. And you know, we have 30 employees right now. And we build a lot of software. And we do a lot of media, on our website and whatnot. And so that was just that was this our approach to it. And we, you know, we invest in marketplaces and networks and FinTech and software, but we also do bio, we also do things like games or crypto. And so we invest in lots of different kinds of things. Because again, like with Esther, we're not as early as Esther goes, but we're quite early. We're, we're seed stage, where we invest sort of one to $3 million. And then we meet with the companies every week, and help them with every aspect of the business, because that's the fun part.
Just to add some context, what what James does is great, and he has a lot more resources to, to help the companies and to make a big difference. Whereas for me, it's it's kind of like, investing is like playing tennis, you know, why? Why pay someone else to play tennis for you. So I don't generally invest in funds or backs are syndicates, I sort of do it myself. And that limits how much I can do. And as he said, there's there's two, the world needs both of us.
I think that's such a great point after because one of the fascinating parts hearing you both speak is that you both been responsible for so many successful deals, but have, you know, different uses of money, different approaches, different end goals. But I'd love to hear from each of you. What is an investment that really surprised each of you with how well it took off? And what's the deal that completely crashed and burned and surprised you with how badly it failed? Is that question of timing is that consumers not getting it. I'd love to hear from interview James, maybe we can start with you.
Oh quickly. The one that really surprised me was doordash. So I made an angel investment in them at the seed and I thought it was a good idea. But there was lots of other companies doing it. They just seem to have more data orientation, and so it it seemed like an okay bet and it was a low valuation. And then the unit economics were just horrible for a long time and then I sort of assumed it would crash and burn but then SoftBank comes out of nowhere and gave them $600 million. And suddenly they were able to get to a scale and many of their cities where the unit economics turned around and That was quite surprising and quite lucky. So that's, that's an example of a positive one. And then I mean, he kind of had to believe enough in it to put in the money you put in. But it was very surprising how big it got and how well it did particularly after about two or three years when I figured, oh, yeah, this can, this really can't continue. And then the one that I'll give you an example would be called wheel well, which was like house for cars. You know, house lets you kind of, you know, get all the photos together for your remodels and whatnot, these guys let you do the same thing for cars. And you would design your car and you would buy the parts and, and all this sort of thing. And it did really just failed, because I learned all sorts of stuff like us there said, like, from your failures, you learn a lot of things and automobiles are just hard. It's like not so much money that, that it's not such a high average sales price, that there's a lot of profit in it. And it's super competitive. And it's it's more of a nice to have no need to have. And then you've got all these different tiers of sort of the e commerce thing, like I learned about how tough e commerce is with, well, it's got this much gross margin, but this much net margin, but this much real margin, after discounts. Yeah, that says a lot of complexity in e commerce that I learned about through the failure there. I think it was just a hard business to be in like, they were trying to sell new items not not used items, therefore, they were competing with Google and Amazon for traffic to, you know, whereas if you have a used item, you have a unique skew on the internet, and therefore people will come and buy your thing, maybe for a higher margin. So it turns out the US is actually kind of better than the new in many cases now that the internet is so transparent, which leads to successes like poshmark, and other things anyway, learned a ton, just really nowhere to go. No matter how hard the team worked, it wasn't gonna work.
What a cool answer. And Esther How about you?
Okay, so I'll do for briefly, the best investment I made without even really noticing was I put some money into Square and it's now funding Wellville. You know, like, under 100,000, or $100,000, or something. And one of the worst was a company whose name I fortunately can't remember. They were trying to be a social network, they started scraping Facebook's data. I mean, it was sort of public information, but it kind of annoyed Facebook. And then the company sued Facebook and destroyed my relationship with Facebook for whatever it was. And the CEO was basically uncontrollable. And you know, I have no idea what's happened to it. And every once in a while I get some spam, where somebody spoofing his name. The one that I loved, that didn't work out was called Boxbe, that was the idea of sender pays email, user charges, because that that kind of deals with some things going on. That part of the problem with email is there's no friction, and it's too cheap to send email. So you get spam. And you get too many emails from people who don't bother to worry whether it's relevant to you or not. And so the sender pays the cost of going through the sorry, the the recipient pays the cost of going through the email. So Boxbe had the idea of you could set up your own charging, and it would capture your email. The internet world really does not like friction. So it failed. But I still think the idea fundamentally makes sense. And you're seeing remnants of it now in LinkedIn in mail, except that the recipient doesn't get to charge or in something like only fans where the you pay to get somebody's attention, whatever kind of internet attention it may be. And then the last one I want to mention is adventure holdings itself, which ran PC forum and the newsletter released 1.0. And our CEO definitely kisses here online. I think she was. So that was 25 years of my life and I think probably 15 or 20 of hers. And it was wonderful. It made money, but not a lot. We sold it for I think 2 million total after 25 years, which is a VC was pathetic. But it was probably the best investment I ever made in my own education and meeting people like James courier and pretty much led to everything else I'm doing now. So there are different things you get out of an investment.
Dr. Alex Wissner-Gross. I think you're the last guy to graduate from MIT with three degrees at the same time they stopped that after you you did that you're very clever. Let me call on you to ask, Esther and James a question.
Thanks so much, john. And yeah, the story that I was told for the discontinuation of triple majors was it was to protect the mental health of MIT students. So take from that what you will, Esther and James, so, and Esther in particular, I want to rise to the bait of exponential progress in technology. I'd love to maybe hear your perspective in James perspective on why or why not? We're going to see a singularity, a technological singularity in the next few decades. Pro singularity anti singularity, are we just missing the ball completely?
So I wasn't really talking about singularities, singularities in technology, it's more the the exponential growth of money, building a business to sell it, rather than to operate it. And, you know, you're seeing this with specs, you're seeing it in so many different ways. And I'm going to quote, the Zephyr Teachout, who I think this is one of the most brilliant metaphors I've ever heard. He said, profit in a business is like sex in a marriage. It's, it's an important part of the marriage or the business, it keeps it going. It keeps the whole cycle going. But more sex or more profit doesn't necessarily make the business better. And it's not the purpose of the business, or it shouldn't be. And I just I just love that. I mean, I think making an honest profit is great. But, you know, spending your life trying to sell things is addictive, and fundamentally unsatisfying, and unsustainable.
So maybe to pull the thread on that a bit? Do you see a contradiction between exponential progress in terms of actual technological capacity of our civilization and exponential growth in wealth, it would seem to me naively, that if if our civilization is going to advance rapidly over the next few decades, that one of the happy side effects, maybe unfortunate side effects is that we'll see an explosion of capital, not all of which knows how best to deploy itself and sort of sloshes around a bit in the process.
We're seeing that already. And at the same time, we're seeing people, we have enough stuff to feed the world, but we're not allocating it properly. And we're not thinking long term enough to educate people, which are our most important asset. And, you know, again, our biggest problems are short sighted thinking in terms of time, that also in terms of who we're thinking about. There's amazing technology that's going to happen. And, you know, if 200 years from now, some or 50 years from now, some AI is better than people, I don't want to be focused on humans. But I'd like to have a say in what defines better.
Jameson. Yeah, I think, you know, I, I think long term, I do believe that we become post economic within the next few 100 years, I think as as money becomes software, as you do get AI is making things more and more efficient, and more and more efficient more rapidly, we do reach a point where capital, which is really just in my mind, a belief in the future. But if you have confidence in the future, then you have capital. Capital emerges from from the ether when when you have confidence. And as we become more inter networked, as we come as become more rafted up to each other. Each of the nations, each of the towns, each of the people become more attached in the network that has the ability because of its size and density, power, B our ability or confidence in predicting the future will go up and therefore wealth will could go up. And then we'll have these rails and these systems, these technologies to allow that confidence to flow between us with less and less friction with more and more certainty, you're going to see an explosion of capital, we will reach a post sort of economic world where confidence will will slosh over to the person who needs it when they need it, you know, Grameen Bank and other forms like that are just the raw raw raw beginnings of that. And, and so yeah, I think we are going there. And I think that will will be a sort of inevitable thing. I don't know if it'll take you know, 100 years or whether it'll take 400 years, but i think that's that's certainly where we go.
I wish I believed you, but it's It's definitely an interesting vision. I just doesn't seem to comport with human nature.
Well, there's two, there's two main things, I think stopping it. One is cultural desire to stay the way you are, right? People don't want to be educated. In many cases, they don't want to learn the lessons about how wealth is generated. I know that I people, my family who refuse to think of money as anything other than the root of all evil. And once you take that mindset, it's like, Okay, well, there you go. So I think there's a lot of sort of cultural resistance to evolution that we get from people, once they, you know, want their cognitive biases. So that's one thing. And the other thing is just status games. And if we can successfully divorce our status games from making sure everyone has enough capital or belief in the future of move forward with with their capacity with their talents, then I think we better off right now status games are largely tied to money. I mean, they're largely tied to things like universities and whatnot, but they're largely tied to money. And over time, maybe we can separate them. We haven't been able to do it with colleges yet. But maybe soon.
This is such a great dialogue, I want to open it up because we have amazing people in the audience. So first of all, if anybody has a question for James or Esther, please raise your hand, we'd love to bring you on to the the virtual stage. And I see in the audience, Tom Gruber, series inventor. And, and Speaker, I think in a couple of weeks. Tom, do you have a question for Esther, or for James or for both?
I can make one up, I think the last fly the conversation was fabulous. In fact, this direction I love to go these days, too is if you go if you really want to think about the future of tech and money and all that we have to come back to what is our society grounded on? You know, and that's the thing that often gets overlooked by all these futuristic conversations. So I'd love to hear anyone's comments on that is like, what is collective intelligence arising from these days? Do we even have, we have we lost the ability to make sense of the world collectively, and things like that. So I get off the mic.
I guess that's one of the things that has surprised me. I used to be sort of techno utopian, you know, 20 years ago, and about the sort of flourishing of human potential that we would see. I mean, the first company I started was sort of self improvement meets the web, or I wanted a lot of people to understand themselves better, because the root of all knowledge is, you know, knowing yourself, and then moving out from there. And I was hopeful that the technology could democratize that and make it easy and free for everyone. And yet, we see that, you know, the darkness is equal to the light in the human subconscious, in many ways, and that the technology, being as liquid as it is, is amplifying and, and allowing those aspects of humanity to flourish, which, which we just have whether they're considered to be darker lay. And, and so I think we are on the same foundation we've always been on, it's just moving faster and louder now.
Yeah. I mean, I wish, it's like I can imagine a world that is so much better than what we've got. What I can't imagine is how we get there from where we are. And that's, you know, that's what I'm trying to do in a very small way in well, that we talk about training API's, but we neglect to train people. And if we started, there would be fights. I mean, I would love to have mandatory parent training and all the well bills, but, you know, I don't delude myself that anybody's going to want to do that or particularly want to do it in the way that I would do it. And
That I think that's the big insight isn't it, Esther. Isn't that the big insight that? I mean, I remember when I started my homeschool, and I was so interested in education and reforming education and coming up with new curriculum and, and all that and I lost all my enthusiasm because I encountered the parents. Yeah, and the parents are the problem. They don't want to have their, you know, you know, existing assumptions questioned or changed or they're the ones who want the system. They want the SATs because they took the SATs, and they say, so you're saying that I shouldn't have taken the SATs, you want to get rid of the SATs. You want to do this, you want to do that, but I'm fine. You saying I'm not fine, and it just becomes this battle. And it's the parents that have the problem. We have all these administrators who want to change the curriculum, they want to change the schools, you have the kids who are dying to be educated. The problem is the parents they don't want it.
Well, it's not the parents. It's the parents' parents, and I mean that it's like you can't blame people, but you have to recognize their flaws and their failings. And you need to be realistic about all this yet at the same time, you know, it's like, intellectually, I'm a pessimist. In terms of what I'm actually doing, I'm an optimist, because being a pessimist is definitely not going to improve things. But being an optimist might. That's the challenge to all of you.
So I'm looking at the room, and I see that Cady Coleman is here, one of our favorite astronaut friends, I see Josh Simpson. Josh makes is a glassblowing artist. And his work is in the National Gallery and one of the top class artists of our time, I see sunny Bates. Everyone loves sunny Bates, Sunny blades here, like sunshine to everyone. I see my case is here, served on a US nuclear sub. Thank you for, you know, representing. So next question. What stage Do you think we are in the digital revolution? And you have concerns about the power of the tech Titans and more about government's attempt around the world to regulate them? jump ball?
What does jump ball mean?
in basketball? Anyone who wants it?
Oh, whoever wants to grab it? Yeah. Gee, thanks, James. I have I have concerns about the power of the tech companies and I have concerns about the powers of the governments I spend enough time. So take I can, the purpose of ICANN was to basically make sure that nobody took charge of the internet and manipulated it to their own ends. So we tried to create this power vacuum. And we successfully kept the government's mostly out. But we ended up basically being run by the business interests, who sell domain names, and it became something of a protection racket, if you ever wonder why there's so many domain names and why somebody can actually sell a domain name, that's clearly a typo of Microsoft m, one, CR O, bla, bla bla, it's because they made some money off. Because I can't exists on the basis of the fees it gets from those registries and registrar's some pretty what I really want is a balance of power. And that's obviously difficult to get and but people keep thinking that they're going to get the answer and get to the end of history. And they aren't. The only way to end history is basically to blow the world up, or kill all the people and then you won't have anybody doing all these terrible things, but you won't have any people left either. You know, we, we need to take people with all their imperfections. And whoever we is, that's part of the problem. Try and make sure that nobody does anything too terrible with all the power that the internet is giving us. But by reducing the friction, we're we're increasing the volatility as things going bad and going well.
Yeah. I agree with that. I think that we are probably in the second inning of a nine inning baseball game. You know, the first 25 years might have been the first inning since the internet came along. And I guess maybe maybe this would be the first 50 years. And now we're now we're into the second inning. It's just getting going. But I think where we are now with these big tech Titans is that they have emerged onto the stage with these big old network effects, which nobody can sort of counter. And the governments don't know what they're looking at. And so we don't have a balance a good balance between the government and these tech Titans yet because the government's don't even know what what they're what creature This is. We've never seen a real network effect media company. I mean, we had a two sided network effects for newspapers and some TV stations, but they were only a very local this Facebook thing. And the companies they've acquired like Instagram and WhatsApp. This is a this is something the world's never seen before. And we don't know how to deal with it. And so we need to think, you know, it's a network. Not a, not a Fiat, not a, not something granted by the government. It's a network effect, which gives us power and so we have to have Network Solutions to it. We have to augment The network so that it runs properly, because it's not running properly right now, because the mindset of the people who are leading the companies hasn't matured to the point where they can effectively act like stewards of what they've lucked into. And, of course, the fact is that many of these companies which get big, only got big, because the founders don't have the sort of sanguine, balanced perspective that Esther and I can sit here and talk about, they had a much more aggressive personality that got them there in the first place. And so you end up with people in the wrong spot, you know, a little bit like politics more and more, where you end up with personality types that are being drawn into getting through that process of getting elected, that really shouldn't be there, once they land there. Although they were successful at the process of getting there. They're not good once they're in the seat. And so as we look at the, you know, the United States has this wonderful balance of powers, that doesn't exist in all the other places in the world. And I think it's one of the things that makes us different from other countries. You know, people talk about American exceptionalism. And that's kind of the only thing I can really point to and say, yeah, we're, you know, that that balance that design, a balanced design that the founding people gave us, you know, is unique, or tried to be unique. And, and that balance has always included heads of industry, like the head of General Motors, or the heads of Ford. And now they include people like Zuckerberg and Dorsey and whatnot, but they just haven't been incorporated yet, effectively. So the network, the balanced network of the United States certainly isn't functioning properly, or at its optimal spot, you just have to keep trying.
And there's lots of other governments that I really would not want radio, I mean, you know, look around the world, a lot of governments use the internet or the stuff on the internet for their own ends. And so this is the challenge. Things that I might not mind too much the US government doing very much would not want the government is, say China doing and, you know, at least we have some notion of transparency, and people don't get shot all the time for being journalists. But so it's just, you got to be careful what you wish for? Because in neither case, are you going to get a perfect version of what you're wishing for.
I love your description, James, because when you describe sort of how unique the tech Titans are, and you think about Zuckerberg testifying in front of Congress, and all those people standing behind the representatives, handing them notes, trying to explain, you know how the internet works.
exactly you you totally understood like how mismatched this was. And I think you're right, it's about network effects marry to big data. And, you know, when you think about either our government responses, the people at the helm, the challenges, I would love to just understand from both of you what you see as the biggest, unintended consequences that you think we're going to have to deal with for the next decade. I mean, is that political polarization as a growing economic divides? I know, so you talk a lot about addiction. We what what do you feel from the second inning are going to be some of the overhanging effects?
So James on mute, so I mean, I do feel that we are getting more and more addictive as a society more and more short term. Things are so easy. And it goes back to Danny Kahneman Thinking Fast and Slow. And we we do it's easy we do. It's convenient. One click is one of the most addictive things Robinhood to me, is a gambling site, not an not the democratization of investing, it's trading. And somehow we need to understand that nature made us grab what we could find because we grew up in an era of scarcity and we are not biologically mentally neurologically suited for abundance. And how we deal with that fundamental contradiction, I think is going to be the deciding question of however many innings it is. It's it's going to be key.
Yeah, yeah. No, I agree. There's a big shift going on between scarcity and abundance right now. There's another big shift that's going on which is transparency the the technology is making all this information transparent and and it's not having a positive impact on most people because We are naturally as homosapiens comparative, and we're hierarchical. And we're, we're spend a lot of our brainpower thinking about where do I fit into the pack? And what are the signs that I'm doing well are going to be accepted or not accepted. And what's my status, basically. And the internet is making transparent, where we all sit, and most of us aren't at the top. And if I'm a, you know, let's say, a real estate agent in a small town, I can be happy with my job. But now the internet makes it clear who in that town is the very best agent. And more and more of the work goes to that best agent, you know, and she's probably better looking than me, and she's probably taller than me. And she's probably come from a nicer family than me. And I was luckier than me, and, and every day, I feel like crap, because I can now see through the internet, where I really stand in the hierarchy. Whereas before, I couldn't see, because it was all on paper. And it didn't happen quickly. And so the the power laws that exist in the world are becoming more and more apparent due to the internet. And I think that's the thing we're going to have to deal with, mostly is, is everyone realizing where they really are. And it's kind of depressing, and they're not going to feel relevant. And I think, I think to some extent, you're seeing that play out. And in the 2016 election, where people were feeling and seeing where they really were, and it wasn't, it was, it was really more of a status issue than it was anything else
the one, one positive thing is, it's not just transparency, it's the ability to understand how the world works and to understand counterfactual. So it's easier to say, you know, if we do invest in preventing diabetes, or whatever, we actually will save money down the road, we still need to have the political will to do that investment, and to take that long term approach. But I'm hoping that that will help. Another thing is, we're starting to ask AI why it does stuff. Because a lot of AI is not transparent. And it may cause us to start thinking, Well, you know, maybe we should check the biases, not just our AI, but if our people because we people are much more mysterious black boxes than AI ever is. And to the extent that we can, number one, have the ability to examine people's biases, and to give people the tools to manipulate themselves rather than leaving that to Facebook. And that's where jack Dorsey's new idea of selling people, customized algorithms is really, really interesting, though he hasn't quite explained how it's going to work. But the idea that you can in fact design, whether it's Facebook, or Twitter, or you know, something that an app that encourages you to do stuff, to manipulate yourself, rather than to be manipulated by someone else. That's encouraging.
Let me ask one quick follow up to both of you. Because to your point, Esther, they been matching judges, I think it's an Illinois against AI algorithms on sentencing guidelines. And they found the judges had so many biases, you know, depends whether who won the ballgame who just had lunch. But one of the the overhangs I worry about. And I'd love to know if either of you share this concern is something that I call watch the algorithm, which is really that as AI and big data play bigger roles. I look at the fact that we've got very good algorithms for things like eyeballs efficiency, low cost, high speed, but we really don't have algorithms around the tougher questions like, you know, inequity well being happiness, God, I think that will be the last one to come. And I just wonder, as we
gross national happiness in Bhutan
exactly as you do trust that.
Well, so as your just to finish the questions so, you know, as we build more and more of big data and algorithms into our functions, as they're playing bigger roles, and you can see this at Facebook, there was a great article about how they're somebody has the job of trying to re engineer the algorithm. And it's really almost a black box at this point. So what do you both think about that? I mean, do you think the algorithm really matters? Do you think that we will be able to develop these more sophisticated algorithms and where is that on your technology concern list?
I'll let James answer first for a change.
Oh, well. Look, I think that, at least for the last eight years, that's kind of all we've been talking about around here is, you know, the person who's really running the world is the person who who's running the algorithm at YouTube? and deciding what to put in front of you on that page? Certainly, he's running the life of my 12 and my 15 year old, and teaching them what to learn. And then suddenly they get a Jordan Peterson thing. And then down, they go into the, into the right wing rabbit hole. And, you know, I've had, I've had several kids kicked out of school because of what they learned on YouTube being sent down the right wing rabbit hole. So not my kids, but other friends. Because then and it's like, I think it's critical. And the fact that nobody knows the names of the teams of people who are working on those algorithms is amazing. And I again, I don't think the government nor the media really understands the power that these people have. And, and it's getting it right is critical. I remember, we were thinking, you know about the Sims, when they came up with the Sims game, like, who designed the algorithm to teach me, you know, how much I should invest and how much I should educate and how much you know that that's teaching people right or left wing politics based on how those algorithms are structured. And so millions of people went through the Sims, and I don't, I never played the Sims. But everybody got taught whoever, whoever designed that algorithm was basically teaching politics. And so yeah, it's critical.
So Well, yeah, go Esther.
Yeah, I mean, I just add to that, the, the algorithm may be mysterious, but the goals of the algorithm are pretty clearly set by Facebook's metabolism, not by its values. In other words, they want to make money. And I mean, we read this again and again, and again, ultimately, they're looking at what is going to engage users, unfortunately, what engages users is the rabbit holes, James was talking about
the fringe, the fringe ideas, the dangerous ideas, the shocking thing. And that's the darkness
Yeah, but it's not that mark likes the fringe ideas. It's that he likes the money, and his board wants him to make money and his shareholders want him to make money. And some of the biggest scandals in Silicon Valley recently have been not just the CEOs, but the boards. So it's, it's the DNA and the the brain that get overcome by the metabolism of making money in this exponential. We want to keep we're building this company to sell it, whether it's to sell it to shareholders or to an acquire or whatever, rather than we're building this company to do something amazing and make it useful profits so that we can keep growing it.
Esther, how would you like to see them? Run it? What would you like their mentality to be if you could have influence?
I mean, personally, I love the way Daphne and I ran adventure holdings. We provided a good service, we charge for it, we made enough money to keep growing and we paid ourselves but we didn't make a killing when we sold it. And it, you know it? I mean, I'm not crazy. I don't expect adventure holding food never go public. But there should be a little more concern for the other parties involved, including society, not just the stockholders.
Right. And I suspect, I don't know that. But I suspect that he's surrounded by people in a network of employees and shareholders and whatnot that want to maintain the status quo, and would be damaged because their stock prices would go down precisely. If he came out and said, Look, we're not going to maximize our profit, we're going to maximize our profit over the next 50 years. And to do that, we need to, you know, take all the stakeholders into account. We're going to be more transparent, where to change and add new forms of revenue generation that do not encourage dwell time. And we're going to evolve the company over time to not just be dependent on dwell time. And their their stock price would go from seven or 50 billion down to 350 billion or 400. Right here, 550. But they might be more sustainable for 40 years, precisely. Instead of getting ripped apart. Like the DOJ wants to do. I don't know.
I want to tell a short story. Because you know, it's not that Zuckerberg is evil. He's surrounded by people whose jobs depend on him. So it adventure we were maybe five or six people. Long story very short, I dropped my computer and they went to get it fixed, which took a few days because I totally wrecked the hard drive and so forth. And this five person company definitely comes up to me after two days and says Esther, this is really awkward, but we're we're trying to get your computer fixed. We're not. We're not part of the problem, but you know, just be a little nicer, please. And I realized that in this company of five people, she was terrified to tell me, Don't be an idiot. Don't be a jerk. And I mean, imagine what it's like when you're at Facebook. Nobody's going to tell Mark Zuckerberg not to be a jerk. And his board is going to tell him, you're doing great man. You just need to go see those revenues a little more for the next quarter. And it it pervades a culture that people say yes,
We have two more questions from Allison I and then we want to open it up. And the last question, and I know James, you're an investor in clubhouse, and it's a clubhouse related question. But the question I have now on just before I ask it, I see how Haley Reardon joined clubhouse today. She's an amazing folk singer, I think like 21 years old and has lived a light, you know, many lifetimes as a folk singer, and she's going to be one of our guests in the future. I also see Mark kodesh, who is the who's created a great health series that Anthony Fauci and others are going to be speaking at. Great to see you guys to future speakers. So the second last question that we're going to ask is about a long view, how do we move from our focus on the next quarter, to thinking about impacts that will stretch out generationally, like 30 to 50 years from now, is this the type of transition to longer term thinking is essential if we're going to be able to address things like climate change, and I feel like the pandemics been sort of a wake up call to, to getting us to think a little bit beyond the moment.
Well, I guess, gesture wanted me to go first, I'll do it again. But I had an experience when I was a kid, that made an impression on me, which was in my mother was trying to help save Boston Harbor. But we had banners and stickers and pamphlets in our house, and she would go down to Boston and hand these out and raise money and try to raise awareness and save the harbor from keep it from dying. And this effort failed. And the bay did indeed die. It was black. There was not a fish, there was not a mollusk, it was dead. And then once it was dead, people got on planes, and they rode down to Washington, DC. And they brought up some people from the Congress and they said, hey, look, it's dead. You can be a hero, by giving us $4 million, we can clean up Boston Harbor. And then it'll be nice again. And they said, Yeah, that's a good idea. Look, it's really dead. Let's fix it. So they gave him $400 million to fix Boston Harbor. Now Boston Harbor is beautiful. There's fish and mollusks in the whole thing. And I learned a little bit that humans definitely have a hard time unless you're Japanese have a hard time thinking about the long term, particularly in our American culture. And so I think we, we can either try to get people to think long term, or we can try to design things to take advantage of their short term thinking. That actually help for the long term for those people who do like to see the future. So I'm kind of more into not arguing with people and trying to get them to put aside their current what they think of is their best interest in order to save for the future, the way the Norwegians seem to be able to do. I'd rather spend my time thinking about how do we create short term incentives for for Americans to do the right thing.
James, I ran a 10 mile swim from 1998 to 2008. In Boston Harbor 10 miles and water is clean. So thanks for your advocacy. Esther, do you want to take this?
I think I probably said enough about it. It's, it's a culture change that is needed. That is very hard. And it's worth talking about, but not preaching about.
Maybe I can come to a question that we would actually love to hear from both of you on and then it's also probably a good question to open it up to our audience. So it only seems appropriate since we're on clubhouse at the moment to ask you what each of you think the business model is for clubhouse. And I know James, I understand you're an investor, but we'd love to hear where you see social audio going. It'd be cool if you could paint us a picture of what we'll experience on clubhouse a year from now like adds fees for content and also love to hear from our audience as well as both of you What have you experienced on clubhouse? That's most excited. You I'll volunteer my answer, which may sound strange, but it's on after us every night. It's a clubhouse lullaby. It starts at 9pm at night, and they invite all these musicians on, give them different lullaby challenges. everybody wears these little sleep paths. And everybody whispers. And it's an amazing way to go to sleep with about 2500 people you don't know but love to hear from each of you sort of what you you love and clubhouse now what you're not a fan of and where you think it's going in a year.
So James, you're probably better informed, I'd love to hear the inside story, and then I'll just follow on.
Yeah, so um, look, I don't have any insight inside information they've published pretty broadly. And if you go to the sort of clubhouse, you know, City Hall type things, you'll hear them talk about this rohana and Paul are very aware of the situation Facebook's gotten itself into, and they are seeking to avoid it, they are not going for the ad driven model, they want to go for the paid model, they want to figure out how to be more like a Patreon, where there are creators who create content, like Allison and john, and that they can get compensated for creating these experiences for people in various ways. And then clubhouse plans to take a percentage of them. So I think that's what they've declared. They don't know exactly how it's going to happen. But you know, there's lots of ideas. And I think philosophically, it's a good way for them to go.
So, I've been watching this with great interest. And obviously, so much depends on the people using it. It's it's kind of like asking, well, so what's going to happen with 200 square miles north of New York City. It depends who moves there. And they're gonna do all kinds of things. And then there's a government, in this case, it's clubhouse that will tax some people. And if it does it, right, it will tax things that are not good for the system more than it will tax things that are good for the system. I think it's fascinating, I love I love the I love the fact of not having to look at people the way you do on zoom, I think it's a much better environment, you can sort of see who's who's talking without having to look at the faces all the time, because you have the little shimmering things. It's it's very cleverly designed. On the other hand, it reminds me so much of Ted, you have sort of the people on the stage you have then the people in the front row, and then it's sort of like the others. And it's a bit hierarchical. But it sort of goes back to what James said earlier, you know, how else are you going to organize people? I don't know. But there may be some more creative ways to do that. There's so many business models that could work and clubhouse can take a commission and then you'll have other people showing up. Well, our Commission's are lower, but our audiences aren't as big and you can, you can put lots of you can put the only fans business model on here, you can put the pay to be part of an elite group on here, you can put the pay the Ask a question. And you can leave that up to the users, but provide the tools to help them do that. And then a lot depends on you know, will they have the courage and the hair, shall we say, you know, like the just the courage and the conscience to say certain things are kicked off. You know, it's they just, again, government, censor private organizations simply impose their standards. And it would be great if their standards were somewhat better than the standards imposed by Facebook at this point. So there's a real opportunity to do it better based on the last few years of learning.
So Esther, I'm going to take that as a challenge to this room. And I'm going to remind everybody on this call that there is no fee to ask a question at this point. We would love we'd love to invite anybody no matter what row you're in. To come on stage, there's nothing formal. So we have at least 20 minutes left with Esther and James. So please put your hand up if you have a question. As you can tell john and i are not shy on calling on people. But it's a really incredible opportunity to have Esther and James here. So please put your hand up. If you have a question you'd like to ask
Cory Rachel or Ben, did you or Yeah, you want to give it Yeah, Ben.
I'd love to ask a quick question to either Esther or James. I think that So we heard a little bit earlier, brief mention of how maybe the darker side of network effects and how they can kind of grow out of whack. And I think there is the possibility that we're maybe there's something that we see sometimes when things grow too big or too quickly, that they can really backfire. And so, Esther, I know you're on the board of the long now. And James, you're in the process of I mean, you run a venture fund, and so you are profit driven by definition. I'm kind of curious, like, Is there an optimal size for a network? That you see, is there something like, Can it be too big? And if so, how do we know where those limitations lie? And I look for maybe the two of you to riff on that. Thank you for that speaking.
Couple things. Number one, we have found that in groups, this is magic number, this ruso number of 12 seems to be magical. We've seen with omata, with a number of other sort of weight loss programs that there's number of sort of 10 to 18, sort of where it works, too few and there's not enough energy too many. And, you know, no one gets to be known. That's certainly a number that that stands out in terms of certain networks being optimized. Of course, we all know about Dunbar's number at about 150. What we've seen with a lot of message boards is that if you get more than 250 people on a message board, it all goes to politics and sex. And so we actually built a product years ago called heavy electron which didn't work as a business but was interesting experiment, which would automatically downshift or upshift a message board subject, so that you stayed between about 125 and 250. People at all times. So that again, there was enough energy but but enough sort of responsibility to not do the bad thing in the group. And then that so those, those are two numbers that come to mind in terms of optimal sizes that we know of, I would say that, in general, there is no real optimal size for something like a Twitter or Facebook or a clubhouse, it all depends on the interface. You could have a clubhouse network with, you know, 4 billion people. And as long as the interfaces correct, you know, who can see who can raise their hand, you know, boba, you're going to end up reducing the pollution, and incentivizing the right behaviors. And you do get network pollution over time, but you can reduce it simply by good product design. And that's why the the number of people who have built products that have scaled like clubhouse or Facebook or a snap, there's just so few people who can do it. Do it? Well. It's a it's a real difficult challenge. It's an art. It's an artistic challenge to balance these networks with the right interfaces and whatnot. And anyway, clubhouse seems to be doing okay out there. Certainly talented. And we've seen Paul and Ron do this before with highlight, and then again, with role and now with this. They're practiced.
So I'll add a couple of thoughts. There's there's a network, which could mean all of Facebook's members or all of clubhouses, members, then there are communities that are actual, you know, that's where the Dunbar numbers come in. And the 12 people in a omata group are the people in an Alcoholics Anonymous group, or almost anything. I mean, I'd like I was on the board of Meetup. And, to me, basically the difference. There's, there's something where there's a small group of people, and then there's an audience, and the audience may be necessary, but the individual members are not missed. Whereas in a community, you'll say, Oh, you know, where's Alice this week, or there's, it's like, the members of a community are actually present. They're not simply numbers. One, one other interesting thing to consider. You know, when you when you watch a company grow, it usually gets founded by two or three people who know one another, and they hire their friends. But then at some point, you need to move from friends, and everybody's an individual to having policies and to creating structure and, and architecture and reporting, reporting ranks and stuff like that. And you need to think about diversity. And one interesting challenge with diversity is if you have a group of 10 people, and you bring in and of course the 10 people are all men or they're all white, and you bring in one black person or one woman. It very rarely works because just deeply psychologically, that one other is supposed to stand for all women or all black people and They get very lonely and three people, three black people is three women, suddenly, in the sort of reptile minds of the other people, it becomes almost impossible not to notice that the three women are different, and that they actually represent different points of view, even though they're all female. And that's slightly overstated. But it's really important to diversity is not hiring one person, it's understanding all the people in the community as individuals. And so things change as the size of the community changes what's required to make stuff like that work. It's just, I hope it's a useful observation.
Well put Esther, let's get a few other questions. Elizabeth or tea or Cory? Evan?
I could jump.
Okay, yeah go. This is the Michael Jordan of accordion playing.
aptly named by by john, no, I want to actually get an answer. I just want an honor to be in this room with you. I know of course, your your grandfather was a very, very well respected musician. And if I'm not mistaken, he was knighted for it as well or something of that.
Thank you. It's incredible. So yeah, I'm, some of you guys had talked about with that of hierarchies of things. And I can speak and you know, I'm just a musician here, you guys are some incredible people in this room. It's quite an honor to be in here. I'm world champion in what I do in accordion, and a Guinness World Records and things of that nature. But I see in the music industry, what has happened with with hierarchies, and I just think they're so so important. And like, I think James was mentioning this about because of the internet. Everybody now sees where they sit in their respective hierarchies, where before you just you saw the mountaintop of Okay, these are the best players are, these are the best architects and these are the best or whatever it is. And you said, I want to be that, but because of the internet, it has brought everyone to the fore. And you actually end up seeing where most of the people, of course, just by mathematics are our average people or, you know, average accordion, mycase accordion players or something like that. And you start hating everyone above you. And in the same way that when I talk to people, if I say, especially younger people, I say, yeah, I'm World Champion, if anybody, they always go instead of Wow, they go, Well, what does that mean to be a world champ? Like how do you get judged to be better than someone else? And there's no respect for it. So then, what happens is you go, then why did I spend all this time to become so great at what I do? I mean, that there's no motivation of that. So then you think, well, I guess there's no point to do that. And that destroys the whole structure of everything, and in any field. And then you don't have you know, you we want to have a society where there are people that want to climb that mountain, and I think it's important just for everyone to have direction of they see a mountain is clear, okay. That's why I want to get to I want to practice or I want to study whatever it is to get to that. And it's so important to have that society. And we and I just every day, I feel like we're going further and further away from that, to the point where, you know, if I say something like that, they go, Well, how did you get that? And then there's no motivation of it. So I, I am when we're talking about future stuff, I do worry about destruction of hierarchies. And I just think it's one of the great most important aspects of a successful civilization is to have hierarchies.
James or Esther?
that's interesting to me. The idea of the destruction of hierarchies, I kind of feel like I might be hearing something new that I hadn't thought of before. Because I've been thinking that what the internet does is it really makes it easy to have hierarchies in such a way that it becomes detrimental in a way everybody's creating a list of who's on top. And who's got more status and who's got more money on the Midas list, or more of this or more that. And, and then there's implicit, like how many people are in your clubhouse room? And how many followers do you have? And, you know, it's like that Black Mirror episode where as you walk around, you can see a number put on everyone. It feels to me like, like the internet, because of the data data collection we're doing is making the establishment and the demonstration and the transparency of hierarchies much more possible.
Well, I guess I should say, more meritocracy, than necessarily hierarchy. In the fact of Yes, you're saying we you see who is the most popular and they just filter more and more and more. But I'm just looking at from my business of music. And you know how we have gone from these unbelievable musicians 70, 80 years ago, 100, 200 years ago, you were not known and respected in the world, unless you were at least extremely good or if not the best. In any cat in any genre music and now, I mean, you know, I go to the Grammys every year and all the top musicians, we're all just we pretty much hate watch the Grammys, because we know so many unbelievable musicians who barely can get $100 gig that are quitting because no one can understand how good they are. And these people that write to chord songs, with the simplest melodies are worth billions of dollars. And it's because the merit of it has fallen off. That's it.
So the success, the success criteria in music has changed to be your hair is better, or you're somehow more controversial. So you get more likes, or there's other attributes of the performance, not just the music that end up dominating, who moves to the top of the Grammys hierarchy? No.
Or just, you know, the anything? Yeah, yeah.
But you I mean, you also get sort of you have this very big, fat front, and then there's a long, long tail. And the only fans notion that, you know, all you need is 1000 fans who are willing to pay. And if you're insatiable for attention, that won't satisfy you. But if, if you want to make a decent living, you can actually do it with 1000, fans, or whatever. So it becomes much more decentralized at the edges. And then there's this sort of, I don't follow the music business well enough to know. But you know, there's the Grammys or whatever that's very centralized and perhaps rigged in one way or another. But there's so many different specialties, so many different clubhouse events going on each night that everybody can find their own audience, it's just very few of them, find a larger audience. And maybe that's great because they could do audience they want and ideally, they get a community rather than just a passive audience.
So let me jump in, because we have four people with their hands up and seven minutes left. And Cory, let me encourage you to bring your accordion to the clubhouse lullaby session that starts at nine. But let's see, let me just tell you the order. I have Elizabeth Carr. Jocelyn T and Pete, the pizza guy, and if anyone else has a question, put your hand up. But Elizabeth, I think you're next.
Oh, great. Thank you. Well, thank you for this. It's been enlightening and a privilege to listen in on this conversation. So I deeply Thank you. And with James and Esther's collective knowledge of trends and where to invest for a better future, I'd love to pick their brains on what they see as best practices going forward regarding political activism. For instance, I'm really concerned about the trend toward voter suppression and state legislatures making it more difficult to vote. So where can i or any grassroots activists best put our time and our efforts, you know, heretofore I donated to candidates and groups and wrote letters to voters in Georgia phone banking, but going forward? Is there more effective way to change that trend? I'd love to hear your thoughts and insights.
Well, I don't I don't know. I don't know that I have the answers to that. But I do think that you're right, that you know, we spent a lot of time writing paper bass notes this year. And I kind of felt like it was a little bit in the past. Like that we were functioning in the in the past by doing that, it does feel as if it's mostly moving digitally, into video. And I think that being part of of people who are creating digital and video content that reach the right people and looking analyzing the data about which people need to get reached, is really where the real impact is. And when we study you know, what happened in Pennsylvania and what happened to Georgia, I think that's going to create a new blueprint for how it works when the time of big data and will continue to evolve those tools and as you know, whoever uses those tools most aggressively and most expertly is going to have a big advantage on on either side or any of the multiple sides.
Right? Well if I can ask a follow up question because
I'm actually Elizabeth maybe what we'll do cuz we have five minutes left and Okay, three questions. So maybe you have thoughts. You want to get to Esther on Elizabeth's first question.
I'll just plus one, James, and thank you Elizabeth, for being activist and don't stop.
And maybe what I can suggest is that for T Joselin and Pete we ask questions, and if there's time, Elizabeth glad to come back to a second round, but maybe yes, T Joselin and Pete, we can just hear your questions. And then we'll have James and Esther come in on all of them together. They say good at answering multiple questions at once. So
let's get in also I've been getting sure before them.
Sure. Okay, let's start with john. Joselin and then T and then Pete and then Suzanne. And then over to you, Esther and James.
Well, you forgot Gerard, but that's okay.
Okay, wow. Okay, look, let's start with Joselin.
It's Joselin, thank you for no worries. I'm Dominican. So appreciate. So the comment you made
Great to see your host Joselin, love you Joselin.
Thank you, john, I thank you for putting this together. So I really appreciated you mentioning a person of color and being on on, you know, being a participant and being the only one because for the majority of my life, have been generally that only one person speaking for person of color, and Dominican, and so on and so forth in the Boston area, john knows. So my question really quick, where do you see the way our society is going regarding information consumption? With the network of information, primarily negative and worse? Fake information? Is there an opportunity for a more factually based social network to evolve? Or how we how we pass that point?
Yeah, I think there is, I think that the people who are creating that just need to be really good. I think what you're seeing right now is that the fringe people are more passionate, just like they give more money to political candidates. So the fringe people are putting more energy in on a daily basis to create their disinformation, because they're so passionate about it. And those of us in the middle who see both sides, or not sides, but see lots of different attributes of issues, have a hard time generating the money and the energy to put our our life's energies in that. So you don't see as many talented people in the center. So I think that's the issue right now.
I think we're actually supposed to listen to all the questions and then kind of answer them and some wonderful summation. But, you know, what, James said is pretty good. So let's keep going.
So you're like the perfect student in the class. So we have four people with their hands up by my count at Suzanne, then t, then Gerald and Keith. And if you don't mind, we'll group those together, and then turn to James and Esther for answers to as many as you can remember. So Suzanne, your next
Well, mine would primarily be to Esther, and I'm honored to be able to even put a question, you know, forward, because I'm just a nurse. I'm a pediatric oncology nurse. And for me, having a room like this is being able to you know, the whole hierarchy is gone, because I share an idea with all of you. But quickly, there are no hospices, there are three in our entire country. And there's no hospice policy, I spent 30 years working on Children's Oncology units, and witnessing the need as medicine, advanced witnessing and changes in end of life support. We don't have legislation and so here in Seattle, I'm trying to build a children's hospice, but trying to find impact investors. So so there's no grants, there's no boxes for pediatric palliative care and hospice. So if anybody has any ideas, how to guide me to bring not an underserved need, but an unserved need for these families, so children and families who need respite, and options for end of life care for the kids can get up. Super. So let's see. Let's turn to tea. What what's your question and who's it for?
It's for both Esther and James. But Suzanne, I'm working with a rural hospital in South Georgia, we're in the same problem. Let's talk touch base off thing. James and Susan James, first of all, thank you so much for the network effects Bible. I've preached that to so many rural hospitals that that Bible in the in complexity by Walter for what they have to understand for the future. My question, we're working on trying to work on the hard problems in healthcare. And sort of my question is how do you drive bottoms up innovation in healthcare, when you look at what's been effective, so far, like an MD calc? Look at the things that work, bottoms up, can move positive change, top down has unintended negative consequences, especially in rural and urban America?
Wow, awesome set of questions. And Pete, do you have questions? And then john, let me know if I missed anybody who had a question, Allison? I did, Andrea. Oh, great. Okay. So Pete, you're next and then Andrea.
Yeah, this is for James. He mentioned earlier much earlier about post economic and almost like post status. And I'm just wondering, I'm very skeptical of that idea. I wonder if it's possible. If it is possible with this post status and post economic look like to me, he post economic sounds like post choice. So it's tough for me to envision. Thank you.
Wow, I can't imagine how you're going to answer all these I can't wait to hear. But Andrea, what's your question?
Thank you. This is to the whole panel. Thank you so much for this time and for the chance to speak. I was wondering if you could say a few words about your thoughts about the reality of this phenomenon of stakeholder capitalism that's being discussed and reimagining capitalism? And what your views are about how realistic that is? Or how you see that unfolding. Thank you.
Oh, my God. So john, did we miss anybody?
I think, let let Esther and James take these, respond to these. And then I have some closing thoughts. But people asking questions. Thank you for being so thoughtful. And thank you for joining us all tonight. So James, and Esther, what do you guys want to share?
I can just quickly jump in. I mean, you asked about stakeholder capitalism, I feel as if that's going to evolve in the same way that most things evolve, which is through competing interests, I think that there needs to be a, you know, sort of cultural shift around what is considered responsible leadership, particularly in for profit businesses. But I also think that the technology and information and data need to be used by the stakeholders who aren't being addressed, to aggregate themselves, and then, you know, apply force basically, to things like Facebook and other folks, we just we need use the technology to come together to take, take the externalities that aren't currently being factored in, and, and factor them in to the to the core of the things that are moving the economy and the society. So but I think that's going to be a battle, I don't think that's, I don't think we can ask people to be the way we want them to be. That's never worked in the past, I don't think it'll work in the future. I never said that, we would get to post status. fact, I'm just saying that the status games are always going to persist. I mean, that's, you know, that's how the human brain works. But we would try to separate it a little bit from only money and have them play other different games. So that they can get their status is out and other ways. What I do believe in those will get post economic to the point where what that looks like is that there's so much money, that all the people are sitting around saying, Well, where's the great person with the great idea and the energy to go take that money and turn into something great. And as soon as that person raises their hand, like the money just flows to them, and then they have the resources, they need to go off and do stuff. And I've been in communities where everyone in that community is post economic. And I can see how that works. And really, they don't talk about money, they talk about talent. And that's what the world looks like is we were just we're desperate for talent in the future. Rather than a lot of talent running around desperate for money, and then bottoms up innovation in healthcare, I don't have a great answer for that. I tried a bunch of things Esther knows. But, you know, 12 years ago, I tried a thing called mid pedia, which was bottoms up, I tried GIF, which was more bottoms up, I tried a lot of things, and it's tough. It's hard.
So basically, we can pass laws there lots of businesses who in the end, they don't mind being regulated as long as the competition gets regulated to. And they'll negotiate with unions, as long as other people have to negotiate with unions. think things like, you know, minimum viable wage, which I would argue sort of need to be geographically adjusted, but there are things we can do, we can we can create these power forces that have some power of visa v. The giant corporate structures, and I think, with luck, we've maybe noticed some of that in the last few years. Because of all the disparities that both COVID-19 and George Floyd and Briana Taylor and, you know, the whole Trump experience, have made much more visible. It's, it's, it's a fractured society, and we need to figure out how to make it better. That's not going to be easy. In healthcare, honestly, I would say we don't need innovation, we need better implementation. You know, it's, we do need change, but we don't need AI we need, again, money spent on preventing diabetes, money spent on child care money spent on maternal health. And as a society, we need to understand that it's worth paying taxes, to create a society that we all want to live in. Which is all very inspiring. And so I hope you go and have a nice lullaby and go to sleep and dream of a glorious future. And, you know, maybe we can make some of it all come true.
Great. So thank you, Esther. Thank you James. In closing, I want to thank our two guests. Our two speakers. We're gonna mail you both Green Lantern rings as a small token for participating in this. Sorry, it's not a Star Wars memorabilia, James, but I figured you have a lot of Star Wars stuff. Next week we have Mike federally, the CEO of Forbes and he was on tonight, we have sria shrinivas. See who's on tonight. Also, she's an expert at bionics on the brain interface with bionic limbs. And she's also working with Bob Langer on studying the microbiome. She's phenomenal. The week after that, we have Esther with jiki, Tom Gruber and Rebecca Kleinberg are all we're here tonight. Rebecca is a world expert on the voice. And Tom did Siri and Esther jiki is an educator and Google was founded in her garage. And there's an interesting story there. And then we have the week after that Robert Waldinger and Linnea Olson, talking about health and happiness. And I think Linnaeus still on the show. just in closing want to thank everyone for joining imagination action, you want to have people who've used their imagination to make change and make the world a better place. And, and also role model how we all can be using our imagination. Now, these are interesting, challenging times, but also tons of opportunities. And we want to get the best kind of role model model for us. So just in closing, James and Esther, any closing thoughts before we close down the room?
Yeah, it was great. Thanks, guys. Super fun. Great.
All right. May the force be with you and live long and prosper. I'm mixing my shows. But James knows I'm a Star Trek guy.
And Cory thank you for the shout out to my grandpa. That was great.
And thank you everyone who joined us we were the audience is so special on clubhouse we appreciate your patience and it's not easy to always be in row 94. But thank you so much for joining us.
Hey, James, just as we shut down the room, you know, you've seen a lot of clubhouse you've been on it since the beginning. You're an investor. You know, this is a little more serious topic. How did you think this this room winters compared to what you've seen in clubhouse in general?
Oh, I thought it went great. I'm gonna write you an email about my thoughts on pros and cons and how you can improve for number five.
Can you cc me please? Sure. This is great. I'm glad I stayed for the extra credit question at the end. Thank you guys.