Lessons From Backing The Best Founders In Fintech | Micky Malka

24:49But then when he was a much older man, he also has these two books of maxims called The Autobiography of a Restless Mind, Volume 1 and Volume 2. Again, somebody can compress the language and give you a lot of ideas in like, you know, a sentence or two. A lot of people have asked me, it's like, why do you think, you know, Visa is one of the most successful companies of all time? I think one of the most profitable per-employee companies in history. And yet not a lot of people talk about it. And somebody asked me one time, or a few people have actually asked me this, like, why do you think that is?

25:14It's like, because it's still very confusing on how he actually built it. I've read his book two times and I still don't really understand. So, like, what else do you think you learned from D. Hawk? Did he influence the way you built Ribbit at all? Yes. Okay, I want to know about this. And not only Ribbit, but my previous startups, too, because he taught me so much about how to get people to be the best version of themselves in the kind of organizations that you have to have. Even my go-to question on interviews, it's a question he taught me on how to ask. So I've learned so much from him. What is that question?

25:50I give people six words, and I tell them to organize them in a certain order. And then the way they walk through that order says a lot about the person. And it was a letter that D wrote to his team in 1972, I think, where he articulates all of this. So I learned that from him. So spending time with D, what you get is that he understood human psychology better than anybody in that era in that particular space. He understood that to get bankers who, by their sheer DNA, are people that tend to be risk adverse and people that care too much about their reputation. He found a way through this model of association.

26:34His biggest success was the legal model he used. No one had ever done a company in that structure. And the association model allowed everybody to save face, but at the same time take the credit. And that's how he won. Because it doesn't matter who you were, which bank competed with the other one, it didn't even care because each one can compete by themselves at the same time when the brand won. That was the beauty of D. When you spend time with him, he will say, it was the model, and people don't get it. So I find that his restless mind was alive, even in his early 90s, because I would have sweared that he could have been Satoshi Nakamoto if he had been 40 years younger.

27:21He had explained to me blockchain and what, for him, Visa was a failure, if you talk to because he only got to release the simple version of it, which was payments. He wanted to do a lot more, which looked a lot like blockchains and smart contracts are today. But he was probably 60 years ahead of his time. Deal is how the best founders turn the world into their talent pool. I've been studying how history's greatest founders operate for a decade. And one thing they all have in common is they understand that recruiting and hiring the very best talent is your most important priority. A players recognize other A players, which is why top companies like Ramp, Shopify, Eleven Labs, Uber, and DoorDash all use Deal.

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28:35With Deal enabling us to hire and support exceptional talent anywhere, we can accelerate our innovation and bring more voices, stories, and ideas to every corner of the world. Deal is trusted by over 40 ,000 businesses. Learn how they can help your business today by going to deal.com forward slash Senra. That is deal.com forward slash Senra. Let's go back to the young kids that you spend time with and the way they think about company building compared to some of your older founders. From what sense? I think the founders moving forward, like obviously they're going to be way more capital efficient.

29:11I think they're going to own larger percentages of their companies because they're going to need to raise less money. I think you used the analogy of one time if you go back and look at like some of the Robert Barron's who owned like Henry Ford on 100 % of his company. Some of them would go public and they'd own 70 or 80 % of the company. Yeah, I'm just very curious, like, how you think they're going to be building companies, again, a 21 or 22-year-old compared to even like a 35-year-old. So the first thing about these generations, they understand that if they play by the rules of the game, they will not win.

29:44The rules of society right now. They will be stuck in student debt. They will be stuck in a bunch of problems. They've been watching this through YouTube. They've been reading about it on social media. They've been seeing that we have spun an era of Elon, of innovation, of Edison people mindsets that it's allowing the mind to really flow. And surprisingly, capital is right now historically levels of almost unlimited capital access. Especially if you're younger, there's even more capital than before. It's a perfect scenario for this generation to really create and take risks in ways that you cannot imagine.

30:27Funny enough, when you talk to them the most, you will find that a lot of them feel that working on software alone is boring. It's not fun. It's not challenging enough. They want to build physical objects. They want to touch materials. They want to get their hands dirty in building stuff that will actually matter and get to our hands one way or the other, which is super interesting because that was not the generation of the last 15, 20 years. Everybody was trying to go comfy to light. Everybody was trying to build software only and try to go through the cycles as fast as you can. This generation is not afraid of getting their hands dirty.

31:02So it's super interesting to see the behaviors. What's the difference? Why? I don't know. Like maybe they just find that they grew up with a phone, they grew up with a tablet, they grew up with a computer. So it's not interesting enough to limit the world to just bits and bytes. But the more time I spend with them, the biggest thing and the biggest question that I find asking them is, because the oldest of this generation are probably 25, 26, the younger are 18, you ask them, what were you doing during COVID? And that is the most fascinating question. The most successful ones right now were the ones that during COVID were learning.

31:41And were on YouTube, sucking information about anything and learning about everything in life. So when they go and build companies, they find that first they're naive, so anything's possible. Second, technology is there, so anything's possible. Third, if you're older, you get knowledge and you get wisdom, but you may not have the motivation. So they need to find out how to bring that from people. And so what you're starting to see is that the best ones are attracting some of the best older people to come join them because they feel that magnet. So the younger people are recruiting the older ones.

32:22Yes. And they're making them work in little hubs of two or three with two young ones. They're pairing them. Two 22-year-old kids with somebody much later working in teams together. And that's where they're jetting between their knowledge of the new ways of operating systems with the knowledge that you need from 20 years of experience. If you play this out over the next, like, 5, 10 years, aren't they going to have, like, a massive technical advantage too? Because, like, me and you use AI a lot, but we have other stuff going on in our lives where, like, they can live and breathe it 24-7. Yes, and they will.

32:59And we just got, what, this year, high school class, sorry, college class is the first one that actually went to college and had AI the four years. We just started. The senior class, the rising senior of college, it's the first class ever that probably used JGPT to write an essay to get to college. I keep asking questions about the young people that you hang out with because I've had founders literally in their mid-30s, and they're the technical leaders of these really successful companies. They're like, I don't know if I can do this anymore. I'm too old. I'm like, what do you think you're too old?

33:34You're 35 years old. You're like, yeah, I think I'm going to get smoked by a 24-year-old. I don't think they're too old, to be honest. And I don't feel old, and I feel I can still play the game. But you've got to understand that you've got to play a different game. You cannot keep playing the same game that you were playing in your 20s or in your 30s. You've got to understand that the way these dynamics work and what you can bring to them is very different. What can you bring to them? Wisdom. Knowledge. Give them experiences. Stuff that they don't understand. By the way, the best ones, they still lack, and they have to refine its taste.

34:09They've got to be able to articulate how to build something beautiful. That's not easy. And if something that we've lost in society, it's the ability to build beautiful stuff. Silicon Valley has lost that ability a long time ago, and we have to bring it back. I'm hoping this generation is the one that spends time thinking how to deliver beautiful experiences. Say more about Silicon Valley losing the ability to build beautiful things. So if you think about the last 15 years, the incentive systems and every metric of success was wired on scale, grow, go bigger, have more nuance, more work. But it was kind of about building beautiful products.

34:53When was the last time you bought something, a technology product that you loved? And you were like, wow, this is beautiful. I don't even want to tell you it's embarrassing, the answer. It was a Dyson vacuum cleaner. That's great. And by the way, Dyson comes up a lot when I ask this question. Also the… Airwrapped, yeah. If you have a daughter or any women in the house, they're obsessed with Dyson's products. And somebody on your team here was showing us they still carry the iPhone SE. The SE, yeah. Right, the small iPhone. Why? Because it's beautiful. It was one of the first ones. It's designed in a different way.

35:30So we have lost that ability. And because we have given a prize and a reward for efficiency, algorithm, compounding of those things, and we have put aside how it makes you feel. In this world where technology is taking over a lot of our lives in the way we're going, more than any time in history, we're going to need that feeling back again, how it makes you feel. And it's not just the brand with a TV commercial. That's the point I'm less worried about. It's more about what's authentic, what's beautifully designed, and what does it make you feel when you are around it. It's the perfect time that you're bringing this up because right now, literally, a few hours this morning and the last few days, I've been rereading this biography of Johnny Ive.

36:23I think it's called, like, Johnny Ive, the genius behind Apple's greatest products or something like that. All he talks about is feeling, feeling, feeling, feeling. He didn't think computers were for him. He thought they were ugly and tacky. He starts using a Mac. This is years before he'd been working at Apple. And he's just like, oh, there's a human behind this. You can tell there's an actual human that cares behind this. And all he talks about, he's talking about redesigning hairbrushes and about how it makes him feel, to your point. And I think that if we don't bring that back, the founders that will do that will win.

36:52And the founders that don't have that ability, they don't have a chance. Right before you came over, I was on the phone with our mutual friend, Neil Mehta. And he keeps telling me about Nick from Revolut, right? And we were talking about some unrelated stuff. And I go, oh, I'm about to see Mickey Malka. He's like, you got to ask him the conversation we had if he remembers. Because he said you invested way before he did. I think he's done now the last two or three rounds. But I think he remembers calling you and passing on Nick. Can you tell, like, why do I keep hearing about Nick? and what do you think makes him so special?

37:27You've got to understand Nick for how he grew up and who he is, understand who he was. Funny enough, I was in London a few weeks ago because they finally got their bank license approved, and there was a chancellor there and some public officials speaking, and Nick was there with Vlad, the co-founder. And I was looking at my phone, and I was remembering was the first time that we had handshaked our Series A. And it was literally that same day 10 years before. Oh, wow. And so I went to them and I showed them on the phone and said, listen, 10 years ago we were drinking vodka shots to do our A round.

38:09And what was it about them from day one? First, the name Revolut stands for who he was. He wanted to truly create a revolution in money. Like there was nothing in the middle about it. He had come to London. He had left Moscow. He was a trader. He was frustrated with how complex it was to move money, how difficult and how expensive and how unfair it was for everybody in the system. And he says, fuck it, I got to change this. So that core DNA was there from day one. and then it went, he lifted every single day. He will wake up every day and go swimming. He will work in the office. We were the first one to arrive, the last one to leave and the first one to arrive the next day again and he will swim and stay fit and just relentlessly focus on getting this mission moving forward and people just either competed with him at that level because it was a performance, a level, an execution that it was a machine.

39:20It was nonstop. I just have this mission and I have to do it in my lifetime. I'm glad you said the machine because I think that's what Neil described me. He's like, he's like a fucking Terminator. But that was Nick in his late 20s. That was who he was in his late 20s. Now, the Nick of today, 10 years later, he's gotten better. It's getting better because now he can lead. He can lead by example. He can lead by mission. He's a missionary also now. He can lead by taste. He has very strong opinions on how things need to go. He still has 20 people direct report to him. And he will work seven days a week.

40:02And then every number of weeks, stay two weeks off. Like, you can see his behavior of work. He's fine-tuned to who he is now compared to who he was before. So consistency, what I like to do is when we back these teams, we try to understand the DNA of the founder. And we try to understand what drives them and how do they work. But more importantly, we want to see if that DNA reflects in the offices, in the team, in the people, in the way they talk, in the way they move. And you still go to the regular offices, which is like now in, I don't know, 15, 20 countries. And I've been to the one in the Middle East, in Barcelona, in London in the last year and a half.

40:40you still breathe that DNA still there. So that's what keeps it going. It's a very special way that you've got to understand the founder really well to know because each org is very different. So when you say you want to understand the founder's DNA, how do you go about understanding that? You've got to spend time with them. And you've got to ask them all the questions, and you've got to build a level of trust where, honestly, you don't have to talk about business that much. What kind of level of trust you've got to— How do you build that trust to talk to them in a way where they feel that they can trust you back, that they can call you when they cannot sleep at night?

41:17Those are the things that I spend most of my time and the team at Revit spend most of the time doing, which is building that level of understanding and relationship so we know how they behave. Once you know how people behave, then everything's fine because you will see consistency or they will break it. Explain why it's important to you to be the person that they call when they have problems. Like you just used the example of like when they can't sleep at night. Because all of us have something that wakes us up at night from time to time. And that particular mind problem that you're trying to solve, it's the biggest thing that you have to get unlocked to keep being the best version of yourself.

41:58And when you're there, sometimes it's really hard to trust if it's a vulnerable question. Sometimes it's really deep and has a lot of strategic consequences, and you want to be really, you're going to your mind a lot. And if we get that phone call, it means that we did 100 things right to deserve the right to be there to help this person think through it. Never answer the question. Just help him or her answer the question. And that meant that you were able to talk about life and family. You were able to talk about society and politics. And you were able to talk about everything because that's the only way you're going to get to really help this person answer the question.

42:42So you have, in many cases, you know, decade-plus relationships with a lot of the founders that you back. How does, like, can you compare, like, Nick to the other ones? Like, what are the traits that you think they share among the people that you spend the most time with? Well, they all want to win in their own way of being. They care about if they are true to themselves, the mission that they wrote on the first day is still present today. And when you find that authenticity, they win. So the ones that are authentic are the ones that you can keep seeing. The ones that faked it to make it, and then they change, and then they move, and then those are the ones that over time you just don't have the appetite to spend time with.

43:25Is it reflected in the performance of their company too? Sometimes you have people that fake it and then they build massively successful companies. Yes, they are for sure. But sometime, somewhere, somehow down the line, authenticity matters. And as long as you're authentic to yourself and you keep your values authentic and you remember yourself while you're doing what you're doing and you can wake up every day with that energy, you'll be fine. So if we go back to that idea that Rick Rubin has, like, these four handful of ideas, could be four, could be five, could be six ideas that he just used for over multiple decades, what would, like, be the list of traits that you would, if I said, hey, list out the four or five things that you want the founders, that you want to build long-term relationships with and partner with over long-term, have, what would your answer be?

44:11We have this thing called the Isle of the Tiger. It's our way of thinking about the people that we want to back and how we want to partner with them. And as everything I said before, it needs to fit in a napkin. So if we run in a napkin, it means that we've thought about it long enough that we have it, right? And it's basically the energy of a scientist, the conviction of a missionary, the heart of a partner, the dreams of an athlete, the obsession of an owner. When we meet them and we spend time with them, we want to make sure those things are present. And if they are, that's going to be people that we want to partner with.

44:48How long did it take you to develop? Like, how many, is this over several years where you guys figured out these reoccurring traits? This is several years. This is probably a decade. So, actually, we probably put it into a napkin five years ago. So, yeah, it took us almost 10 years. Do you consider yourself a patient person? Yes. Several of the questions I've asked you today is like, oh, yeah, that took a couple years, and that took a couple years. You started your first company when you were, what, like 17? 17. And you didn't found, you founded multiple companies, but you founded Ribbit 20 years later?

45:19I founded Ribbit much later. I founded Ribbit almost 20, yeah, 20 years later. Yeah. 21 years later. 21 years later. You've been doing it for almost what? 14 years now. 14 years. Yes. And I heard you say before, it's like, well, everybody's like, well, you guys have this fantastic record. You've done all this. You're like, yeah, it's like super early. We got a long way to go. Yeah. We found amazing people to partner. We got great ideas. We're still building. I mean, we build a company with Walmart. Think about it. It's the first time ever that that has happened. Okay, I just heard about this. We have a mutual friend, Sebastian, former founder of Rappi.

46:00And he's like, ask him about the deal he did with Walmart. It just speaks to a little bit of this value system of ours. David, we had a chance to meet, I've been a fan of Sam Walton all my life. Same. And I had read every book. I had never been to Bentonville until a few years ago, but I had read everything about them and I had to follow. And I remember Buffett owned the stock for a particular period of time until he sold it. And that was when I first learned about Walmart back in the day. And in 2019, through Sarah Fryer, who's now OpenAI, but she was on the board of Walmart, she organized a dinner where I had a chance to meet Doug McMillan, the CEO at the time.

46:41And we had a lovely dinner in San Francisco a few months before COVID. And Doug says, after dinner, he says, listen, if you ever find yourself in Bentonville, come visit me. And I'm like, I don't know what I'm going to do in Bentonville. So I left the dinner. I was so impressed by Doug, his way of speaking, his understanding about macro, the world, the values of Walmart. Everything was so present in him at that dinner. It was a small dinner. So it could have been something different, but it was authentic to him. That we went as a team to a couple Walmart stores. We tried every financial product we can buy.

47:21We could, we did remittances, prepaid car deal. And we found bugs and we found all these things that looked like 1990s fintech. Were they selling them themselves? Or there's like vendors inside Walmart? They had vendors and they had partners and they had their own Walmart car. It was a whatever car. So I wrote them in January before COVID and said, listen, if you're in Mendonville, I'd love to go see you. And lo and behold, he said, yes, shut up, see them with Doug. And he introduced me to John Furner, who's now the CEO of Walmart, who's alongside with Doug. They were there for almost 30 years at Walmart, both of them, since they were 17.

47:58And John is my age. So we started at the same time in two different continents, and we were still in the same room talking about this. And I said, listen, you guys can build something much better with financial services here. This is not your priority number one, two, or three. It is for us. Let's figure it out. And they did something that they had never done. They created a JV, a company that we both go on, and we went together and built a rock star team with a new brand. We bought two companies to build the infrastructure run by Omar Ismail today, and it's called OnePay. And it's one of the biggest financial brands that you've never heard of.

48:36Operating out of all the Walmarts? You will see it online on every shopping cart experience on Walmart. You will see the retails everywhere. If you want to pay with your phone today, the only way to pay at Walmart is with OnePay. If you want to have a debit card, it's the only way. You want a loan from Klarna, it goes through OnePay. If you want an installment loan, you want a credit card, it goes through OnePay. Every single financial product to millions and millions and millions of American consumers. And the beauty of that is that with John being, and this is the beauty of the Walmart culture, John had been in China for a number of years.

49:14He had learned how WePay worked and how Alipay did business. They were investors in India and Flipkart and PhonePay. So then they saw what could happen with mobile money. They have been the greatest partners to have. And so together, between the founder team, Revit, and Walmart, we have built this amazing journey together that is quite unique for a big corporation like that. I found one of my all-time favorite quotes when I was reading the book Zero to One. The quote says, The single most powerful pattern I have noticed is that successful people find value in unexpected places, and they do this by thinking about business from first principles instead of formulas.

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50:42So you want to get started quickly before all of your competitors are on Applovin. And you can do that by going to Applovin.com. That's Applovin.com. Tell me if I'm connecting things that are unrelated or not, but I don't think I am. What was the business that it was either you or your partner built? It was like this bank, this branchless bank in convenience stores or some shit like that in South America, in Brazil. Okay. What was the name of that? It was called Lemon Bank. Okay. Lemon Bank. Yes. It sounds like you almost took like an idea that worked in Lemon Bank because you guys, you were the founder of that?

51:17Yes. Okay. Okay. And then you will explain what Lemon Bank is, but then you sell it to the biggest bank in Brazil, right? Is this not the same idea, but kind of with Walmart? Yes. This speaks to why I keep, I ask you if you're a patient, I ask you what are the traits that you notice in the greatest founders because I notice them in you. So like patients, long-term thinking, reputation, which I want to get to in a minute, which is how me and you actually met. Because you helped me, like I had a big decision to make in my career and like your reputation preceded you. And I was like, I actually need to meet this guy because I have some questions for him.

51:48So, this is what I mean. It's like, you talked about the infinite game earlier. It's like, I'm going to do this to like die, which you just said, which I fucking love by the way. And I'm hearing you talk and I knew the rough shape of the Walmart thing. I didn't know what it was called. I'm like, wait a minute, this sounds like Lemon Bank. Yes. Okay, explain the connection between the two. That's the infinite game right there. You just said it yourself really well. So when you're playing this life game and it's infinite, being ahead or behind in 2003 when we started that business in Brazil, and I lived there for three years and grinded a few times, almost died trying this business.

52:27And we almost killed the business twice along the way. I almost lost all the money I have ever made. We've got to pause there. We're going to get to what it does. How did you almost lose all the money you ever made? Because when we had sold our first dot-com company and then used all the proceeds to start this bank in Brazil. I moved with my wife to Brazil. We were living there. So you had no investors? No, we had no investors. It was just my business partner, Wences Casares, and myself and Michael. So you put all your chips back on the table? All the chips back on the table. We were 25, 26. And almost lost everything because the economy didn't take off.

53:02No matter what we did, we just couldn't, which is how you learn that macro matters. And I learned that growing up in Venezuela with hyperinflation and devaluation. But then another thing is to leave it also when all your money is on the table. So anyway, you're a 25-year-old kid wanting to build essentially like a branchless bank. Is that how you describe it? Yes. And your idea at the time is to set these little like kiosks, whatever it was called. Yes, there were three models. We had inside existing stores at checkout. We had kiosks inside stores, which was a hybrid model. And we had franchisee little stores that only did our payment systems.

53:41Because this is before the smartphone, right? But it was mobile. So we had to, it was a hybrid of 2003 to 2007 era. So we had to build all of this and run all of this. At peak, we had 7 ,000 of these physical spaces all over Brazil. We were serving 15 million customers. Half of Brazil back then was unbanked. Unbanked. Unbanked. So that was the opportunity. That was the opportunity to bank them. We were the first to bank them to 15 million people. So essentially you did like the legwork for the largest bank. Correct. Now we've attacked this customer segment that you haven't succeeded with. We succeeded.

54:17You essentially rounded up a bunch of now customers for them. Correct. They want to buy you. That's exactly right. So you sell in what year? 2008. So 2008, that insight then comes into play, what is that, 12 years later? 12 years later. You're starting to talk to Walmart in 2020. Yes. And that's the long game. That's the infinite game. And by the way, you can tie every single one of our decisions that we've made, like were big decisions like that in the rivet life, to something that happened to me 20 years before. This is really important for, especially for younger entrepreneurs, because you said earlier, like, there's just something wrong about, you know, like we're optimizing for just like start, scale, sell, right?

54:57Correct. Where it's like, you know, some of your partners you've been partners with for 20 years. Yes. Some of the people you've backed, you met Vlad at Robinhood when, I don't even think they had a product yet. There was not an app, right? No, there was. It's not a public facing app. It was never released. No, no customers. So your relationship with them was for like 15 years. Yes. I always say it's like when I've read all these biographies for the other podcasts I have, it's like just stay in the game long enough to get lucky. It's like so much of this stuff is not predictable. And I think that maximum is just stay in the game long enough to get lucky.

55:26So you built a massive business 12 years after you built a very successful business in South America. Now think about the scale of Walmart. This is like not comparable to anything else. And that's the power of compounding. Yes. And it's compounding relationships and ethics and work and principles and love and passion and time. And just don't care about the winning or losing. Just let it be because the power of compounding is the most important equation in society. And everything on friendships, on family, just be consistent, work every day. Yeah, this is like a very Buffett, Munger kind of thing.

56:03Like Munger has that line where he's like, you know, you need to learn the few big ideas in each discipline. they carry most of the freight, I think is the way he describes that. And through all this reading, I was like, my version of this is like, oh, time carries most of the weight. Like, if you're in a good business, like, just stay there, and time will actually carry most of the weight to what you want to do. And so that leads, if you're going to play the infinite game, and you want to do things over the long term, you have to protect your reputation, which is another thing that Buffett would repeat in a shareholder letter.

56:31It's like, hey, we can lose money. We can lose a lot of money, actually. We can't lose a shred of reputation. I want to know how you think about reputation, and then I want to know, and then I'll talk about why it's so important, how it led me to you. I started to go to the Berkshire annual meetings when I was 18. And back then, they were much smaller. They were on a Friday afternoon and a Holiday Inn, a couple hundred people. And as soon as they moved to the bigger convention center a few years later, they had this movie clip playing in the beginning of the annual meeting with a bunch of TV commercials or Buffett interviews over the years.

57:04And every time, since I was young in that age, they were playing the Buffett getting deposed when he was the chairman of Salomon Brothers, saying that line that you just said. It got stuck in my brain. So they replayed it at every annual meeting? Every annual meeting. It was there that deposition, that was, he said that line on a deposition at Congress for something that Salomon Brothers was doing with the treasuries, arbitration or taking advantage of the treasury issuing market. And they played it every single year. And I remember it every single year. And part of the reasons why I wanted to live that life is because it was natural to me.

57:50It was the way you wanted to live life. So, yes, reputation matters more than anything. There's a handful of people that I really trust and admire, and then the people I trust and admire want to know who they trust and admire. And I had a decision I had to make, and I wasn't sure how to make it, Um, it was, there was a lot of uncertainty. I didn't have the information I needed and realized that you were actually in possession of this information. We won't talk about like the details of this. And I actually never, almost ever asked to meet people. And I asked two separate people. I was like, do you mind making this like introduction for me?

58:21And then the first time we met, we actually wound up talking for like several hours. And then we like became like fast friends. But I made a big decision in my career based on how fantastic your reputation was. And so therefore, almost like Charlie Munger has that great line where trust is one of the greatest economic forces in the world. And it's like the level of trust that you have built up over excessive long time with people I trust made me be able to build a relationship and trust your judgment really fast that I could make a decision based on your reputation. And I think this is super important.

58:53It's also something that comes up over and over again. Like I did this episode on Jensen. There's this book called The NVIDIA Way, which is kind of like half biography of Jensen, half company history. And it talks about he pitched Don Valentine. Don Valentine is still alive, still making the investment decision at Sequoia. And Don's like, that was the shittiest pitch I've ever heard. I'm still going to give you money because your reputation precedes you and it's so excellent. So valuable. It is the most valuable asset. It's the only asset we have. It's our reputation. Everything else can come and go, but that's the one thing that we have that will always stick to us, even when we're there.

59:29You know who also shaped my thinking on this? It's like, you've ever heard Palmer Luckey talk about reputation? Have you? No, I haven't heard him talk about it. So he says the exact same thing. He's like, any time he thinks this idea where, like, if people tried to destroy reputation, like, you should just, you know, rise above the phrase. Like, no, this is bullshit. He has just to fight back because the problem is it forecloses opportunities. if this person's damaging your reputation and it's not true it's going to foreclose future opportunities and it's not like if somebody and he's on a point he's like this is invisible and I thought it was a really interesting insight he's like if somebody I let somebody destroy my reputation unfairly and two years later I ask for a meeting with a guy who took that story and believes it he's not going to tell me I'm not taking the meeting because your reputation sucks he's going to make up some other story so he's like you have to protect it and then fight against it I thought it was interesting it's very like a Ben Franklin kind of idea because Franklin would nurture and then also protect and fight back against his reputation 250 years ago.

1:00:25It's very fascinating. I love it. I didn't know that about Red Franklin. I'm going to read more about that. So I told you right before we started recording that I got the art piece that I ordered at Node. I don't even know how to describe the fact, like I spent about an hour there with you. Can you just describe what the hell Node is and why you're doing it? Yes. So I think it's in the spirit of being a rebel. So my wife and I, we love art. We find that art is beautiful. And when you find stuff that speaks to you, it has an immense value. It's been around all of us since the caves, right? It's always been there.

1:01:02And five years ago, we stumbled upon digital art for the first time. I was on Twitter scrolling and I saw an art piece that looked something very similar to a physical art piece we had from the 70s. And then we got into it and started to find other artists in digital art that were doing beautiful stuff that matched something beautiful in history. So we started to pair them together. And that journey took us, like any journey, to get to know the artists. Because what's the difference of these artists? They're alive. And they're all here, and they're all using, they all study computer science one way or the other, and they just decided to be artists and tell a story in a different way.

1:01:42Once you start to meet them, they were rebels in the complete expression of the world, the same way we were describing some of the rebels in companies. Like, think about right now we're running a show on people. That's the one I saw. That's the one you show. So think about people. Think about an entrepreneur who decided for 5 ,000 days to do an art piece every single day, posted online so he can only get better. His goal was he read a book that said if you do something every day, you will only get better at it. And he started in 2007 sketching. 2011 started to use Photoshop. 2014 Cinema 4D. And so the software evolves.

1:02:30And every single day posted an image online that no one bought. People paid attention and just made fun of it or congratulate him or jump against it until in 21, he sells the first 5 ,000 days. What is it, 14 years? For$69 million. And suddenly, it's like an IPO moment. No one pays attention for a long time. You sell it. What does a real rebel do? He said, fuck it. We're going to double down. I'm going to build a studio. I'm going to start building a lot more stuff that I couldn't do before. And now he's one of the most prolific artists alive. All he does is work is digital. And he's not the only one.

1:03:11People see CryptoPunks and they see a JPEG. Actually, I see a movement. I see a cultural artifact. The first art on chain ever created, and it happens to be portraits. Guess what? Every single art movement in history starts with portraits. They always evolve the portrait. So the story is we went to the museums and we said, this art should be seen. Because at home, we put it around our house, and all my kids, when they were teenagers and brought their friends, guess where their attention went? Not the art you have hanging on the walls. It went to this. Yeah. 15, 20 minutes in front of it, talking to it, interacting, asking questions.

1:03:52No one didn't understand. We go to the museums, and they said, yes, we can do this 2028, five years from now, four years from now, and we'll have to find a curator who's going to curate what the artist wants to do. And my wife and I look at each other and say, no fucking way. This needs to happen today. So Node, it's the first digital art studio designed for digital artists. It is a space where the artist is his own curator, because that's what rebels do. You design how you want to show your art. You don't let somebody else tell you how you want to put your art. And it's a place where you come and you get your hands on with the art that speaks to the future.

1:04:35And we put this place in downtown Palo Alto for a particular reason. Because Silicon Valley needs creativity. We need to bring it back. So our contribution to society is put it in a place where people can actually walk in and see it. And we've opened it five months ago. We had close to 60 ,000 people show up already. Every weekend we're breaking records. It's free. It's open and people are interacting. And the most beautiful things, kids are bringing their parents. So you told me the last time you went to a museum where the kids are telling, dad, let's go in. Yeah. Exactly. So that is the difference.

1:05:12So I think we need it going back to beauty, to taste, to creating authentic stuff. And these artists are the most authentic people right now using digital tools. So let's show them, let people interact with them, and let that be the driver for entrepreneurs to use it in their own practices. But this is what I meant about like you're way more entrepreneur than you are investor. Because just like when you start a bank for the unbanked in Brazil, you're like, well, I'm not going to open up branches. I'm like, what opportunity, what's the white space that these incumbents are not, I'm a rebel, what is the white space that these incumbents are not attacking?

1:05:53Well, you just said, like, the museums are, like, they don't even have the infrastructure to display digital art. And, like, I went to Node with you. Like, the walls are, like, customizable. The next, how, the people's in there for what, like, two months, something like that? Yes. Yeah, and then the next one comes in. The infrastructure's still there, but now the artist gets to essentially use the infrastructure as a canvas for his or her art. We think the world will have a lot of these places. Museums will change. They will evolve. It will take a while. The location that you picked speaks to, again, like you're kind of just identifying what's the way they did it and like what's the way I should do it now.

1:06:29Where like you can walk into it. It's like in a very like small downtown area. Yes. It's not like a destination in and of itself. It's something you could just, it's like part of the neighborhood if that makes any sense. If you read history, which is part of the beauty of playing infinite games where you have to live in the future but also understand the past. This is not very different than what happened in Paris with the rebels in their art movement when they were not accepted in the museums. And this is how the impressionism came to be. And all the art that was a revolution that changed the way we look at art in the last 100 years.

1:07:03We're living to that same moment. Funny enough, it's not in Paris. Maybe it started in Palo Alto. And so you look at the first node in Palo Alto almost like a prototype. Yes, because the name node is meant to be a node in the network. So we will be learning here for the next year to perfection our technology, improve our UIs. There's a bunch of engineers working on this. It's a foundation with engineers. Like, think of how different it is to traditional art. And then expand it and open it in many, many other places. Another thing that I want to talk to you about, what's with your fascination with Rebels?

1:07:38It's all over your website. People that know you talk about this all the time. Well, first, I'm a Star Wars generation, right? And I grew up with Star Wars. I'm a big fan of Star Wars. And to me, growing up in Venezuela, the only way to survive in that environment is you had to be a rebel. The system, the dark side was all over. The chaos was present. You had to race above that. And the rebel mindset is one where you know authentically and genuinely that something can be better. And you're willing to give your life for it. To me, being a rebel is just a way of being. It's a way of looking at the world.

1:08:18And when you see something, you can always look at it and accept, how do you make it better? How do you make it more beautiful? What's missing? Just the mindset of always being willing to know that better means it can still be better. I mean, a 17-year-old starting a company. Yes. That would lead me to believe that you had this rebel. You were essentially a born rebel. Yes. How did you apply that? Because people reference you as one of the greatest venture capitalists. I'm like, that's not how I think of Mickey. I don't think of him as a venture capitalist. So when you're building Ribbit, how did you apply your rebel, your inherent rebel nature to your essentially, you're almost like an artist in the sense of this is the canvas that I'm building.

1:09:04This is how you think I should do it, but this is how I'm going to do it. How did you think about it when you started? If I end up being labeled as a greatest venture capitalist, first, I hate labels. And second, I will be very depressed. Because that's not the label. I want no labels. All I want in my tombstone is to say, he was a rebel. That's all I want to be said there. And that will say everything about me. The way I raise my kids, the way my relationship with my wife, the way I treat my friends, the way I make business decisions, the way I change my mind. I'm willing to change my mind if I learn something that is different.

1:09:38That's a rebel mindset. Everything that is the opposite is a mindset that I know too well. My kids are perfect. I'm the best at what I do. And I run away from any of those things. Actually, I find that the rebel mindset is one that you are always asking questions. You're a rebel. You are nonstop asking questions. You want to learn. You want to keep. But you and I know a lot of people that get to a point in life when they stop to ask questions. And they start to preach. That's past the rebel time. and everybody has that breaking point somewhere in their lives. I want that to be the last day of my life.

1:10:15So I need to live by that principle on everything that I do, on every behavior. I'm reveling now against the traditional art world. I'm trying to allow artists to show art in a different way. We revel at Rivet, the way we design it. People were asking, well, what are you? Are you a venture guy? Are you an early stage guy? I'm like, yes. Are you a late stage guy? Yes. Are you a fintech guy? Yes. But are you doing now defense or yes? Like, yes. What's wrong? Like, I'm not going to let anyone allow that. That is the rebel mindset. You are a founder, but you think so much like a founder. So, like, this decision in 2012 to start an investment firm, like, why?

1:10:57I don't think of it as an investment firm. Okay. You have to say more about this. To me, it's a startup. It's a company. And we build our own technology stack, and we have a small team, and we consider ourselves rebels, and our meetings are called Tatooine, and we have Jedis, and we became— Oh, I didn't know this. Yeah, yeah. Oh, so you're really into Star Wars. Oh, yes, completely. Are you backing Jedis or you have Jedis? We back Jedis. Okay. And we have Wookiees and we have Jedis. We have the whole thematic truly alive in the way we think because it has to be authentic. and people that work with us at Rivet, the whole team feels that ownership, that teamwork.

1:11:39Investment firms are very siloed in many ways and I don't love that. We want to over-communicate even internally. Like right now, the entire team knows that we're sitting together. Everybody can see my calendar in my inbox. They can see my emails and I can see anybody's emails. We share all the information so we can actually become better as a team. That mindset is very rebel in this environment. and how we make decisions. We don't make individual decisions. We make group decisions. And there's no, like, somebody asks, who's the partner responsible for that company? He's like, what partner? And you ask the founders, I don't know.

1:12:12I call Mickey for something. I call Nick for something. I call Justin for something. We are just a team that works together in very different ways. So that is the joy of going to the office every day. I love being there and spending time with the team because we just have fun together. What was the insight, though, that caused you to do this instead of, because you started how many companies before this? This is your sixth company? Yes. Something like that? But your sixth company looks vastly different from your first five, correct? Yes. So, like, what was the insight between five and six, though?

1:12:40I had to, in the infinite game, I just had to learn how to do it right. And this time I did it right because I consider myself, even though they were successful and they created a lot of impact and changed a lot of people's lives around the world, I consider myself a failed entrepreneur. That's absurd. That's what you got to say. Like, why? Because the best entrepreneurs never have to sell their company. Okay, another fist bump on that. There you go. And so I had to learn for 20 years how to get to the point to design the structure, the culture, the team, the knowledge, the aperture, the brand.

1:13:21Compound all those values to a place where we can do something forever. This is the infinite game. This is the infinite game. Nick Sleep has one of my favorite lines ever. And he goes, the best investors aren't investors. They're entrepreneurs who never sold. 100 % agree. So that's fascinating. Okay, the fact is I'm a failed entrepreneur because I had to exit. You had crazy successful exits too for my first five because I didn't find the vehicle in which I can do forever. which is again when again like I'm like new to being relatively known in like this community the last like five years for a podcast and I didn't understand because I sat in a room by myself for a decade and just talked into a microphone and read books and I didn't think about the outside world at all and then everything kind of came to me and so now I have to like constantly vet everybody around me and I get a lot of advice from like especially like older more successful entrepreneurs like man you have to be so fucking careful with like because there's it goes back to Charlie Munger it's like most people a rat poison, right?

1:14:20And it's just like, you have to vet them in all different directions. But when I, and even people I want to have dinner with or talk to, like you, you ask a bunch of people and they're just like, he's obsessed with this infinite game. This infinite game. He's like, he doesn't need more money and he doesn't need to do another deal in his life, but he just can't stop. But it's this joy. It's this thing that every day you get better and you just are improving. And, you know, I sat with Charlie Munger once after another meeting at the Hoppy Hollow Golf Club where Warren had this thing afterwards. And I saw myself, and I only had one stock of Persia.

1:15:01I was probably 24 years old and 25. And I sit next to him. Well, he sits next to me. I'm sitting. He says, hey, is he taking? I said, no, come on, sit here, Charlie. And we started to talk. And that room was everybody. Bill Gates was there, all these big CEOs of all these companies. And I was like the youngest guy by an older magnitude. And he looks at me and says, you must be very wealthy to be here. And I said, actually, no, I only own one share. He says, you don't get it. You are the wealthiest guy in the room. And I said, you're wrong, Charlie. No, no, you are. Why? You have the power of time.

1:15:37All of us here are in our last chapter. You're just starting your time. You will compound for the next 70 years of your life. So never forget the rule I'm about to tell you. you only need to get rich once and then that was it he says and now I'm going to eat and just sat down and eat I love that time is the only true currency we have it's the only true currency we have I appreciate you spending your time giving it to us today this is awesome thank you for having me

1:16:15your work. Most of the guests you hear on this show first found me through founders.