Finding the Right Problems: How Sutter Hill Ventures’ Mike Speiser Creates Great Companies

15:52Mike Speiser:If you're pivoting, you probably, maybe you didn't define the problem in the way that you would have wanted to up front.

15:59Ken Hirsch:Maybe, or maybe we have, something's wrong, right? Maybe we have the wrong problem. Maybe we have the wrong people. Maybe we have the wrong people. Maybe we have the wrong process. Right. Each startup is not a cookie cutter. Each one has its unique problems. And if you're doing something that's never been done, you don't know what it is. So you have to figure it out. You have to, that process is risky. But I do think that if I look back, the number of things that have worked really well, we actually picked the problem and the people really well, and we employed a process that led to getting the truth.

16:31Mike Speiser:When you're a founding CEO, you're management, but you're also the investor, and so you're the board. It's not uncommon. Any founder-led company has some of these dynamics, but is there an inherent conflict, and how do you manage it? Or do you not even really look at it that way?

16:47Ken Hirsch:Yeah, you know, I try to, when we get things started, this is one of the back to the question you asked about the firm. The firm always said, if you do the right thing for the team, the founders and the team, it's the right thing for us. If there's a difference between the right thing for them and us, then we're probably going to lose. And so if you generally make the right decisions for the founders, and the founders are generally making the right decisions for customers and for employees and so forth, it all works out when it works for everyone. And when it doesn't work, it works for no one.

17:17Ken Hirsch:So I don't see it as a big conflict. There are moments where there are conflicts, but whenever there are conflicts like that, we resolve it by doing the right thing for the team. And it works out for us pretty well in the end.

17:28Mike Speiser:I want to go a little deeper on Snowflake. You talked about Terry and Benoit. I was fortunate to have the opportunity to work with you when Snowflake went public. Thank you. But it was a monumental success. And I just wonder if you would sort of build upon where you were. Where did that story start? for you? And then how did that manifest in terms of your becoming founding CEO and just the journey that ensued? Maybe a little bit of illustration for the audience and listeners.

17:57Ken Hirsch:Sure. So I joined Sutter Hill in May of 2008. And in May of 2008, I had already become interested in Flash, NAND Flash. So the iPhone was a brand new thing in NAND Flash. Right, 2007. 2007. And NAND Flash was starting to take off. And so I started studying NAND Flash, both for what would become Pure, but also actually it was the beginning of studying what would become Snowflake. For the infinite scalability. Well, the idea was that Flash is such a major change relative to disk that there'd be opportunities to create a bunch of new companies. And one of those companies was a storage company, and I thought one of the companies would be a database company.

18:34Ken Hirsch:But we couldn't figure out the database opportunity. We figured out the storage opportunity pretty quickly. Pure. And Pure. And so we started Pure in 2009. While I was doing that CEO job, I kept on studying databases. And I met a bunch of PhDs in databases, you know, whether they were professors, whether they were researchers, whether they were practitioners. And as I met them, you know, Benoit Dajeville, you know, kind of stood out. And he said to me, your idea for Flash, a Flash database is cute. And Benoit's French. And I had spent a little time in France and I knew cute was a French person's way of saying not very good idea, but in a very nice way.

19:10Ken Hirsch:And I said, well, what's not good about it? He said, well, right now the problem, there are really two types of databases. There's an OLTP database, which is performance, about reading and writing quickly.

19:20Mike Speiser:Transaction processing.

19:21Ken Hirsch:Transaction processing. And there's OLAP, which is analytic.

19:24Mike Speiser:Right.

19:24Ken Hirsch:And he said, you know, the OLTP, your idea is good for OLTP, but that's not really where the problem is. I think the problem is in analytics. So back to your question, you know, I'd studied this for a long time, but Benoit really changed kind of my mindset. The emphasis. And he said the problem is in analytics. So it turns out this isn't known by many, but we did build Snowflake 100 % on Flash. But that was a secondary thing. It was nice to do. It made sense to do. But it wasn't the key thing. The key thing was a database is half storage and half compute. Right. And the storage piece is important for OLTP, but the compute piece is the key piece for analytics.

20:00Ken Hirsch:And the opportunity in analytics was to parallelize. And to do that, we went to the cloud. And we actually built, while we were studying this, we built something where we were testing. The real issue is if you want to scale compute, the problem is the networking speed fast enough to use disparate computers. So that was the study. This first study we did is, was there enough networking bandwidth to use pieces within Amazon web services together as one giant computer? And it turns out there was. And so we went out and we built Snowflake. But just such a good illustration of how we do these things, right?

20:34Ken Hirsch:We went out and studied and you pull the thread and you pull the thread. And the opportunity, I remember I asked Benoit, is this going to at least be 10 times better? I'm sure you've been in the Valley long enough. There's the good old 10X. If it's not 10X better, you don't have a business. He said, I don't know whether it's 10, 100, 1 ,000 or 10 ,000. I was like, whoa, 10 ,000 times better. And he said, well, for some things it should be, but we'll see. And in fact, there are some things we could do in two minutes that took 30 days on a$20 million system. So it was quite a bit better than 10 ,000.

21:02Ken Hirsch:Mm-hmm. You're seeing those kinds of advances today with generative AI. I mean, AI is very driven, very much driven by data increasingly. The post-training we're doing in these models is driven by the quality of the data you have. And so you're exactly right. Data matters a ton. And Benoit was the foresight he had. He was right. He was exactly right. He's brilliant. He is brilliant. And he's a really nice guy, too. It's great when you can work with great people who are nice people too.

21:29Mike Speiser:So you were CEO there from 2012 to 2014? That's right. How did you know it was the right time to transition yourself out, fire yourself and bring in a new CEO?

21:41Ken Hirsch:Yeah. You know, one of the things I think we all know about in Silicon Valley is the first, there are different people that hit different levels. And, you know, you have to ask yourself, when does each person hit the limit on the level? And I think a lot of founders don't feel comfortable raising their hand and saying, it's time to upgrade from me to someone else for this role. And I think one of the nice things in the environment I'm in is I'm quite comfortable saying that there are better people at different stages than me to do things. And in fact, it lets me do the part that I find most interesting, which is the really early part.

22:12Ken Hirsch:I get to keep on doing it over and over and hopefully get better at it. But it was pretty clear at Pure that Scott Dietzen was a big improvement over me at 18 months in. And I remember Bob Muglia called me, a week or two after he took over as CEO. And he said, you know, this is better than I ever thought. And thank God you called me because we would have never shipped a product if you stayed CEO. And I was like, Bob, I really don't, I don't take offense at all. Just make this company great. And so I think that around 18 months, I told Benoit and Terry, I think it's time to upgrade. Yeah, to start looking for someone better than me to run this company.

22:48Ken Hirsch:And they said, no, you're doing a great job. And then a month later, I said, no, I think it's time. And I said, by the wait, what am I doing? And they said, you're not bothering us. You're just letting us do our job. I was like, okay, let's go get someone. Sounds like time to shake the bushes a little bit. Time to go get someone else. But Bob was a lot better than me in a lot of ways as CEO. And that's the wonderful thing is the world's made up of different people with different skills. And if you have put teams together, you can do really incredible things. And so I think that Bob was the right person at the right time for that company.

23:18Ken Hirsch:I mean, I think it's pretty clear that That was true.

23:21Mike Speiser:And here we are 11 years later than that juncture in 2025. You're still on the board. You're very active. You like the early stage stuff, but how do you think about the long term and the way you want to be involved with the companies you incubate, you start, where you play a role like founding CEO?

23:37Ken Hirsch:Yeah, you know, Sridhar and the leadership team was here. It's Monday. So last week we were here talking about things. And it turns out that when you go from nothing to something, it's of a different character than going from something to something bigger. And it's not just the start of a company that you need to go from nothing to something. It's every time you need really a new, fundamental new product, or you need to reinvent your product. And that happens periodically over time. At Pure, after Snowflake, we went and we built something called, helped them build something called FlashBlade. We did a spin-in where their second product, which is about$2 billion in revenue now, we built here and we gave to them.

24:13Ken Hirsch:And I did the interim CO job with one of the founders. We hired all new people and then we spun it in. And I think that really what we are is we're a product studio. We're building new products. And it turns out that's the thing that really matters at a startup, but it actually matters in large companies too. If I look at the companies I admire most and respect most, Apple, who I know you're a big fan of as well. I am. Apple is one of the most astonishing companies in that they got new products from internal development, not just from M &A, not just from buying things. And I think you need to build and you need to buy.

24:45Ken Hirsch:M &A is important and being able to build is important. But very few companies in Silicon Valley can build. Once they're big, they have to buy. And one of the things about Apple that was just astonishing to me is that the quality of the new things they built, it was just really breathtaking. And that's what we aspire to do here, except not just for new companies, but also for our existing companies. And so we're staying involved with our companies and we're helping build the future products and helping them figure out how to build future products. And I can imagine one large tech company reached out to us and asked us to do new product development for them.

25:17Ken Hirsch:And this was five years ago or so. It was the beginning of the pandemic. I think building new products is what makes us happy here. And one way to do that is you create a new company, and that's a good way. But creating new products in existing businesses is something that - Energize existing companies in the same value-creating way. You know, I was in a meeting with one of the great builders. I won't mention his name because it was a confidential meeting. But he said, you know, startups are incredible places. But imagine if you did what you did at a startup at a large company. Imagine what you could do.

25:47Ken Hirsch:And he went on and he did that at one of the great tech companies in Silicon Valley. And it turns out he was absolutely right. Like startups oftentimes win because large companies, they fail to keep on innovating. Sometimes they win because they do incredible new things the world needs. But sometimes they win simply because other people aren't doing their job. And I think that the art that I'm interested in that I'll spend my life working on is how do you create new things? And I think creating new things is obviously necessary when you're creating your first thing. but it's way more important when you're creating your second and third and fourth than people realize.

26:20Ken Hirsch:And buying is incredibly important, but so is building.

26:23Mike Speiser:So you wrote a piece not long ago about the time value of time. And I found it fascinating because it talked about how time compounds in the same way that the time value of money compounds, which is a concept that most people are familiar with. So what was it about how you spent your time early in your life that prepared you to be a great product builder? Like what were the seminal things in your development?

26:53Ken Hirsch:I think I've been told by many people I was a late bloomer, and I don't know whether to take offense or to embrace that. But I think at this point, I think you can embrace. But I think that I think a lot of young people and a lot of old people too, we kind of think you go through school and you learn, and then you flip from school to work and you practice, but it turns out that learning is a lifelong endeavor. And as you know well, you learn more after you graduate than you do when you're studying. And learning is, to me, the fountain of youth. The more you learn, the more you can stay alive. And it's fun.

27:25Ken Hirsch:You know, it's really fun. And so, you know, I wasn't the best student early on. And I think early on in my career, I just got lucky that I met people that gave me a chance despite my lack of capability. And I kept on getting better and better. And, you know, ultimately, I think that if you keep on learning forever, you compound. And as you compound, you get really good. And so people that look better than you today, if you just work for really hard for five years, if they're not working as hard, you're going to pull ahead of them, right? The race is never over. I think a lot of us feel like the race is over when we're in our 20s.

27:56Ken Hirsch:You know, we went to whatever school and studied whatever. It doesn't matter. It doesn't matter where you go to school. It doesn't matter what you study. What matters is that you keep on learning and you keep on learning and you keep on getting better. And to do that, you just have to work really hard. You have to pick the right problem, you know, for you. You need to work really hard for a sustained amount of time. And you need to be intellectually honest. When you're wrong, just say I'm wrong, change your mind. It's not complicated. It's quite simple. But as you know, as someone who I know works very hard as well, it's not super, it's fun to work hard on something you're interested in.

28:27Ken Hirsch:But you know, at some point, it's not always fun to work that hard. It's not always fun to look at yourself and say, I'm wrong about this. I want to change. It's time to change my mind. That's hard. So if you do those things and you grow and you get better and better, you're unstoppable. And what's shocking to me is how many young people I meet now, they don't work that hard. And it's oftentimes correlated with some of the most talented people who went to the best schools and studied the right things and so forth. And it's like, gosh, you're 23, right? You're going to live to 100. You've learned, you know, the vast majority of your life is ahead of you, not behind you.

28:59Ken Hirsch:Don't act like it's behind you. Like, keep on learning, keep on working. Pick something that you want to learn, an area you want to learn. and keep on working really hard at it and try to separate the idea of work and play. And hopefully there's a lot of play at work. But I think the key thing is if you keep on learning, you compound. And that compounding is a pretty powerful thing. Although the half-life of it isn't that long. So you have to keep on doing it over and over. And you need to keep on learning because other people catch up pretty quickly. Especially in technology. Especially in technology.

29:29Ken Hirsch:And especially right now with AI, things are changing so quickly. I feel like it's a little bit of a reset in the world. And the reset can be good. Young people aren't as far behind as they feel like they might be, but they're going to get behind pretty quickly if they don't work hard.

29:41Mike Speiser:So let's use the pivot to AI, where I think if I asked you the question, how many companies are you serving as a founding CEO today? I suspect most or all are focused on AI in some way. How many are you doing? And are there any you'd like to highlight just to talk about what you're most excited about these days?

30:01Ken Hirsch:Sure. I mean, thanks again for coming over here. Part of why I wanted you to come here is I want you to see what's going on here. Silicon Valley is magical and within the magic, there's some magic happening here. So one of the problems was when I was interim CEO, I couldn't do it for a number of companies because I physically had to go to different places. And so by having everything in this one building, I can work on more than one thing in a given day. So right now I have three projects I'm working on. You can call me CEO of all three, but they require very different things. And so one of them requires 80 % of my time right now, and it's pretty intense, and it's called REV.

30:34Ken Hirsch:REV means dream in French. And the idea was that a lot of these AI models focused on taking lots of inputs, multimodal inputs, to make this giant brain achieve whatever you want to call it, superintelligence, artificial general intelligence. and they could produce outputs, multimodal outputs, but the focus was multimodal inputs to get really smart and produce the output, the intelligence output that you wanted. And I'm very thankful for these models. They're incredible. They're changing the world. We felt like there was another opportunity out there, which was to use these models and other things to get the kind of ideas, the fuzzy ideas you have in your head that are like dreams, which is why we call it REV, get them out and iterate quickly in multimodal outputs.

31:15Ken Hirsch:Get them out in natural language. Get them out in natural language, but even more visual things like images and videos and stories. And so what you'll see from Rev this year is you'll see an increasing amount of types of media outputs to help tell stories. And the thing about stories is what the Supreme Court once said. I can't describe it, but I know it when I see it. Well, that's true for everything. I get something out and I want to iterate. Creativity is an iterative process. And so I think hopefully later this year, you'll see some pretty magical things. We are building a foundational model from the ground up.

31:48Ken Hirsch:And it's a lot of fun. It's a lot of work and things are moving fast.

31:52Mike Speiser:So Rev sounds fascinating. What about Bench, where I think you're also founding CEO?

31:58Ken Hirsch:Yes. So Bench is really early, but Bench is a company that's doing an AI for work. So if Rev is an AI for creativity, Bench is an AI for work. And it turns out there are a lot of things at work that are different use cases than the AI use cases that you might need for a consumer at home. Teams, groups of people working together on things. Workflows. Workflows, things that require a lot of knowledge of what's happening within a company. And, you know, groups of people and companies working together. Also, companies have a different set of expectations about how much something's worth than individuals, right?

32:31Ken Hirsch:It's incredible that you'll pay$200 a month for ChatGPT Pro. But for certain jobs, people would pay$20 ,000 a month if it could change the productivity of people, generate revenue, cut costs, and so forth. So the idea of bench is that it's like a workbench. And this workbench is going to use all the different AI models, tools, search engines, all the data that you have in your enterprise. But the truth is we're still turning the crank and we're kind of going to really kind of get it right. And so we don't yet have product market fit. We're going to keep on working hard to get it. One of the really important things back to truth is we talk openly with each other, with our companies and so forth about when we have it.

33:10Ken Hirsch:And one of the problems is that people feel the need, because it's so competitive here, they feel the need to say, declare victory prematurely. And it's back to intellectual honesty. When you declare victory early, too early, and you don't have it, you're not going to ever get it. But when you don't declare victory, when you say we don't have it, a lot of times it's really hard to keep people around because they're getting offers from other people. It's also hard to feel every day like you don't have it. And so the best thing you can do is have a very small team because you can manage a small group's emotions.

33:39Ken Hirsch:With transparency. With transparency. And when you have a large team of people, it's really hard to be transparent. And so what ends up happening is marketing takes over, but that marketing keeps you from getting to truth. And so a very small team of people pursuing truth has a shot at finding truth. Large teams of people, it's almost impossible. And that's one of the things about creating new products on a startup. Startups don't have the money. It's an accidental benefit, but you don't have the money, you don't have the resources to have a huge team of people. One of the problems in large companies is they have too many people.

34:09Ken Hirsch:Well, the only problem you can solve with a large group of people is a problem where you know the shape of the thing. But if you know the shape of the thing, you're not really inventing a new thing. So if we look back to things I don't know, but I've read about Apple. Apple had a small team of people in a separate area that was protected. Because a small team is the only team, as Margaret Mead, to paraphrase Margaret Mead. The only people that can change the world are a small group of people. And fundamentally, creativity, creating new things is art. and art's best practiced by tiny teams, maybe one person, two people, three people, five people, but certainly not large groups of people.

34:43Mike Speiser:So there's no question that AI is already having a profound impact. And we're at the beginning of a multi-decade shift that will affect every business in every sector, in every geography. And you've just talked about a consumer use case around AI. You've talked about an enterprise use case. From your vantage point, where will the largest opportunities for venture-backed companies lie, or is it at this moment limitless?

35:12Ken Hirsch:One of the things, and I don't know whether it's the fact that we're builders or whether it's a truth that's a broader truth, but one of the things we try to do is while we say we're no good at macroeconomics, we focus on microeconomics. So we just put our heads down and we find one opportunity at a time and we try to go do great work. So we really try not to be too much of kind of visionaries that tell you the future of what the world's going to look like. The world's going to change a lot. We're going to make our difference one company at a time, one product at a time and do the best we can do.

35:40Ken Hirsch:I can tell you there's nothing like even remotely close to what's happening right now that I've seen in my life. I'm 54. I've been through, you know, as a kid, the PC revolution is an early young builder, the internet revolution through mobile revolution, through social. And there's nothing even remotely close to what's happening. What's happening right now will change the way we do everything. But I can't tell you exactly how. And I can't tell you how it's going to change venture, but venture is going to change like everything's going to change.

36:08Mike Speiser:We're going to come back to that. One thing I wanted to talk about next, I think it was Snowflake, but a lot of people have said there is no AI strategy without a data strategy. And when I look at the enormity of the opportunity around AI and I look at the work you've done, creating pure storage, creating Snowflake, being at Veritas years ago, you've been in the middle of unlocking value from data your whole career. So given AI's dependency on data, how does that influence how you're steering Sutter Hill today to the extent you can talk about it? And does it suggest you have an edge as it relates to AI?

36:46Ken Hirsch:Yeah, it's a really good question. And, you know, one of the things we are learning about these AI models is that the differentiation is moving more and more to post-training. And post-training is more and more about the data you have and the way you use the data. And any unique and differentiated data you have is a big deal. And so Snowflake, I would argue, a kind of a lucky beneficiary. We didn't see generative AI in 2012 being a thing. At the same time, one of the things I've had to learn and we've had to learn is the way we build companies has had to completely change. We had to reinvent ourselves and relearn.

37:16Ken Hirsch:And it took a while. As this was happening, we were learning. And when I say happening in the late, you know, between 2015 and 2022 or so, we're having to realize the way we build companies had to dramatically change, completely change. The world is changing so quickly. We had to change how we did what we did and how we do what we do. And this back to the point I was making earlier with learning. Learning is a continuous thing. And when you stop learning, you begin dying. And the question of, you know, how long you have till death, it depends on a bunch of things. Right now in this world with AI, you don't have long.

37:48Ken Hirsch:And so we've had to change the way we do everything. So I think that learning how to learn is the thing that we have. But the things we learned are not super valuable right now. We have to go learn new things. And we are, and we're working hard. And we as a firm are relatively small, which back to small groups can move and be very agile.

38:07Mike Speiser:When I asked you earlier about the experiences that defined you, I was surprised by your answer. But what I heard was it wasn't an experience or another. It was developing this ethos of lifelong learning and recognizing that if you keep learning at a pace, you'll stay ahead of those changes and good things will follow. It's really interesting. On a personal level, in contrast to the podcast we're doing today, you've tended to maintain a pretty low profile, rarely speaking in public in comparison to most of the others in the venture community. Has that been a conscious choice for you? and is it ever an impediment or does it create certain advantages?

38:48Ken Hirsch:Yeah, you know, one of the things that a number of people have reached out and friends of mine have said to me is you're not speaking to people because you're being secretive about how you're doing what you're doing. And that might be an accidental kind of product. Outgrowth. Outgrowth of not speaking a bunch. But no, I'm working right now harder than I've ever worked in my life. So I'm working, I don't know, depending on the week, 60 to 100 hours, call it an 80 hour average week. and I don't have a choice. Like I love what I do, but I don't love working that hard, but I don't have a choice. I can not work that hard and lose or I can work that hard and have a shot at winning.

39:21Ken Hirsch:And so when I'm working that hard, you're really sensitive about how you spend that time because the alternative is all the other things you'd like to do with that time. And I haven't seen the benefit of speaking publicly. There are for sure benefits and I'm not benefiting from being a celebrity in ways that I might be able to benefit from being a celebrity. But right now, I don't believe that's the thing that's going to help us win or lose. I think it's back to the things we talked about. It's picking the right problems, which requires a lot of study. It's finding the right people. It's getting those right people to work with you.

39:53Ken Hirsch:And then it's implementing the right process, which is a continuous process. It's not weekly. It's not daily. It's not hourly. It's continuous. It's every minute you're making decisions and those decisions need to be changed when they are wrong and they will be wrong. And so you just need to be really close and iterate, keep those iteration loops really tight. At Rev right now, we go from model to product within 48 hours. And we iterate. And some people on our team who worked at various large companies before, it was anywhere from three months to a year to go from a new model to product. And we're doing it every other day.

40:29Ken Hirsch:So our iteration cycles are super tight. And that just allows us back to learning, right? It allows us to collectively. Individuals need to learn. Groups need to learn. And the faster you learn, the faster you iterate, the faster the probability is that you'll end up with something special.

40:42Mike Speiser:I don't know whether to be energized or terrified. The increase in that product iteration curve is staggering.

40:51Ken Hirsch:And, you know, one of the things we find interesting is it's a rev, it's a bench.

40:54Mike Speiser:Or the velocity of that.

40:55Ken Hirsch:The velocity. And so, you know, I know that it's happening elsewhere, too. And that velocity is making, I don't know if humanity can keep moving at this pace forever, but I can tell you things are going to change and they're going to change quickly. because if it's happening here, I know it's happening elsewhere too. And it's exciting, but it's honestly pretty exhausting too.

41:13Mike Speiser:If you weren't leading a product design studio, as you called it, one might think you're a philosopher because you do actually post fairly regularly on certain social media. And from my perspective, your posts are prolific in terms of imparting inspiration, philosophical advice, and frankly, quite efficiently, the brand you want to project to entrepreneurs and founders. And so maybe just to share for the audience, too, that stood out to me recently, they're often crisp, like if you don't fail occasionally, you aren't being ambitious enough. One that was a little more robust said, you have an idea, put it out there, find what's wrong, iterate relentlessly until you discover something truly great and original.

42:02Mike Speiser:I'm curious, do you use these value statements, these philosophies to drive yourself? How do you think about them? And do they influence how you inspire and lead here at Sutter Hill?

42:15Ken Hirsch:The first thing about almost everything I write is it's almost like self-therapy. So everything I write, I'm in the moment dealing with something. And I'm just writing is a kind of a response. It's a therapeutic response. That's one. And whether I publish what I write or not, I have to believe it's going to have some benefit. But my primary audience is the people I work with, not the people I don't work with. So I'm trying to communicate to people in the companies that I work with the things I'm going through and so that they can also relate. And one of the interesting things is that humans, we all don't want to fail.

42:52Ken Hirsch:And then when we have external pressures to tell us not to fail, it only makes the piece of us that doesn't want to fail even more conservative. but we win as humanity when people take chances and they do crazy things. And so I think that one of the things I always struggle with myself is I find myself trying not to do things I know I should be doing. And so I can only imagine all the people I work with and all the people beyond that are experiencing not only the same thing, but maybe even more severe if they're younger and they're working in a team of people. And so I'm, you know, when I do these posts, I'm really trying to communicate to the people in our companies more than anything.

43:25Ken Hirsch:And if there's side benefits of other people seeing those things, well, great. I think the world would be better off with more incredible things. But one of the things, another vignette for you. Well, I'm reading them. Thank you. Thank you. Well, you're a partner, though. You're someone who helped build it, so you're part of the audience. Thank you. One of the interesting things, you know, I'll give you a vignette in research. One of the interesting things in research is researchers that are building these AI systems, they're humans. And like all humans, they don't want to fail. So each one of these people, they have a portfolio of risks they're willing to take.

43:55Ken Hirsch:but not only the more freedom they're given by their management, but the more compute resources are given and so forth, the more they're willing to get out and take a kind of a portfolio approach, the less rope they're given by their management, the less compute resources per person they're given, the less risk they'll take. And the problem is an organization, if you have, I don't know, 10 people, 50 people, a hundred people doing something, what you want is just a handful of those things to work, but each one of those people wants the thing to work for them. And so you have this organizational design problem where you want to encourage people to take risk, but you don't want to punish, you don't only want to reward the people where the risks work out.

44:32Ken Hirsch:Otherwise, no one's going to take risk. And it's just so interesting how this problem, it happens over and over in every function and in every way. And so that particular post you're talking about, I just had discussions with researchers and I'm asking them to take more risk, which they love. Researchers love hearing that, that they're told the opposite their whole life when they leave academic institutions. But it's actually not just a thing meant to inspire. It's a thing I want to win. And the best way to win is to do really incredible things. And the best way to do incredible things is have really talented people take chances.

45:03Ken Hirsch:And it's really shocking to me how hard it is to get people to do what they all want to do, because all of the world is conspiring against us to not take risk. But if you think about it, if the whole world would take more risks, we'd have more incredible things. People individually, back to incentives, individually, people don't want to fail. And what they need to understand is our collective, our team succeeding, is them succeeding, even if their particular thing isn't the thing. And so a lot of what I'm doing is trying to communicate to the people I work with. That's my primary audience. It's fascinating and incredibly effective.

45:38Mike Speiser:Hopefully. We'll see. Okay. We're going to go to the lightning round, have a little fun. So we'll run through a couple of questions and just get a quick answer. What's the best piece of advice you've ever received?

45:50Ken Hirsch:Well, the first job I had after college was investment banking. It was a two-year analyst program at CS First Boston. And Jake Peters was my boss. And he just told me, just be the first one in and last one out, just work harder than everyone. And I am very thankful to Jake. He worked me harder than I've ever been worked. But I think that was probably the turn for me in my life where I learned about the value of hard work. My parents told me, but it's one thing to know what hard work is. You know, I remember I got to Wall Street and I said, oh yeah, I'll do whatever, you know, 80 hours, 90 hours, 100 hours a week.

46:19Ken Hirsch:And my first day, I'm like, why are people still working at nine o 'clock at night? You know, it's came from Arizona. No one worked on nine o 'clock at night. And I didn't really do the math to figure out what 100 hours a week really was. It's a lot. But yeah, I think hard work works. Who do you admire most? Which investor or company builder do you admire most? You know, he's no longer with us, but Steve Jobs inspired me to come to Silicon Valley, I still think there's been no one close to what he's done. And if I can get to a fraction of what he's put out in the world, I'll feel good.

46:52Mike Speiser:I think we might all feel that. Where do you spend your time outside the office? Yeah, I work a lot. 100 hours doesn't

47:00Ken Hirsch:leave you much. Your 168 is pretty spoken for. Yeah, 168. Yeah. I like to stay physically fit. I'm blessed to live in California. I love to mountain bike and hike and run and be outdoors and, you know, be with friends and family.

47:14Mike Speiser:What do you read in these days? What do you read to stay current if you have time to read it all?

47:19Ken Hirsch:Yeah, I was thinking about this the other day. I haven't read a full book and a long time and I need to do Bill Gates. I read and used to take off like a week or two a year and just grab all the books he meant to. And I never understood why he had to take a week or two off. But now I do. It's really hard to take a step back and have time to like, you know, read a longer text. So I'm just reading whatever papers and whatever's happening on Slack and our companies. But right now my reading is entirely focused on the companies. You know, people oftentimes ask me for advice about what to read to see what's going on.

47:50Ken Hirsch:And I'm like, stuff's happening so fast. I think the best way to learn what's going on is to have ChapGPT read it to you. I think it's to go build something.

47:59Mike Speiser:Yeah. It'll all come out of that. And then the last one, what are you most excited about in the world right now? I'm going to go with AI, but I'll let you answer it.

48:08Ken Hirsch:Yeah, I mean, for sure, AI is changing the planet. What I'm most excited, though, the product of AI is human health and longevity. I do think that we should take really great care of our bodies. There was the saying, live long enough to live forever. And we're not going to live forever, but we're going to live a lot longer. And we're going to live a lot longer because things like AI are going to help us dramatically increase the amount of breakthroughs we have for human health. And so the best thing we can do is take care of our bodies. You and I were talking about this before we came in here.

48:35Ken Hirsch:Like, let's just take care of ourselves. We'll live much longer because thankfully, AI and really great scientists using AI are going to do magical things that are going to help us live longer and longer. So, you know, I'd like to live a long, healthy life. And the best way to do that is, you know, take care of myself until the great science comes along and helps me live even longer.

48:55Mike Speiser:Well, I think that seems like a great place to leave it. Mike, thanks so much for joining me today. It's been an absolute privilege and a pleasure. Thank you, Ken, and thanks to Goldman Sachs for the opportunity. Thank you all for listening to this episode of Goldman Sachs Exchanges, Great Investors. I'm Ken Hirsch. This podcast was recorded on July 7th, 2025. If you enjoyed the show, we hope you'll follow us on Apple Podcasts, Spotify, or Google Podcasts, or wherever you listen to your podcasts, and leave us a rating and comment.

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