Cyan Banister - Investing for a Higher Purpose - [Invest Like the Best, EP.361]

28:08I don't do investing with corporate investors. These guys are spinning out of Google. Do they really have grit? It was excuse after excuse after excuse. I was just like, you don't understand. These people built Google Earth. They really understand mapping. And then the other thing was the insight that I had was that company was ultimately a mapping company, not a gaming company. And trying to convince people of that, they're like, well, they only look at the bird in hand. they're just like, well, it doesn't look like that right now. So not interested. And so I think that that's how my mind is different and how I arrive at these decisions is I just really, really trust.

28:43And I really don't care if people don't believe me or think I'm crazy or stupid or any of those things. And so for me, I don't have those kinds of fears that some people have. As a matter of fact, the more they disagree with me, it's almost like I feel like it's a sign. I'm like, huh, that's interesting. Or I look at the argument and I try to see if it has merit. Like I said, don't be contrarian for contrarian sake. If somebody is coming to you and they have a really good argument, they can talk me out of things for sure. Maybe it's something that I didn't see, but sometimes I weigh that piece of advice and I'm like, Hmm, I still think that they can overcome that hurdle.

29:23I mean, it makes perfect sense to me that you're not going to get unusually good results by doing the same thing other people do. So the toilet paper convention makes lots of sense to me. Do you have a favorite example of some unique input like that leading to an investment that you made? Uber. I lived in a hotel for a period of time. It was a nice hotel in San Francisco. And the front desk would arrange cars for me to get to the airport. And this was before Uber was even a thing. And so there was this livery driver that was my livery driver. And I really took a liking to him. So I got his card and I said, why don't I just start booking you directly?

30:06And I'll just ride with you. You're just an amazing person. And he was an immigrant from Brazil and just a really good driver. And just, I really liked talking with him in the car. One day I was going to the airport and he says, you know, I'm not an investor, Cyan, but if I was, I would invest in this thing called Uber Cab. Have you heard of it? And I said, no, I haven't. And he said, well, I'm their only driver. And he explained to me how Uber Cab worked. And I said, okay, so they're paying you by the hour to drive around and pick up people who are texting some phone number. Keep in mind, there was no app at that time.

30:43It's just a phone number. and you show up? And he's like, yes. And I said, huh, well, let me know when they're not paying you by the hour anymore. And the reason why I said that was for years prior, I was thinking about how, why is it that I go out and I try to hail a taxi and I can't get one, especially if it's raining or if there's a big conference going on, you'd think that there'd be more taxis that would come online to meet the market demand. And so I started talking to taxi drivers about when you go get your car, what's the first thing that happens? And they say, well, I have to pay$100,$150 just to get the car to leave the yard.

31:25So they're already in the hole,$150, right? So they're out there hustling, trying to get that$150 back just so they can be in the money. So they're zooming around like crazy, acting like, because everybody says I get in a taxi and they drive super fast. Well, that's why they drive super fast is they're trying to get to the next fare and the next fare and the next fare. So then I said, well, how do you become a taxi driver? And they explained the medallion system to me. And I was like, wow, what a racket that is. Definitely seems like a protectionist racket. So go back to the driver that I'm in the car with.

31:59This is a livery driver. It's not a taxi. They are regulated by TCP licensing, which means they have to be drug tested and they have to go through proof of insurance and all sorts of things like that in order to be a livery driver. So they started with those for a reason. And that was the first vision. A lot of people, the first objection I heard about investing in that company was not everybody can afford a black car. And I said, well, that's a short-term vision. the long-term vision is that everybody's car becomes available and comes online to drive. And they said, oh, well, strangers won't get in strangers' cars.

32:36And I'm like, what they do all the time, they get in a taxi. You don't know that person. And that person doesn't even own that car. So he gives me Ryan Graves' business card and he says, call Ryan Graves. And I look at the business card and the phone number, I think was in like Chicago or something. And at the time, I had a pretty strict rule about only investing kind of in my backyard because every time I tried to invest outside of my ecosystem, I got hosed. I didn't know the players in New York or the players in Austin or Europe, and I couldn't get follow-on financing for the companies. That's all changed, especially since the pandemic and people have become remote.

33:16But then I was just like, ah, so I put Ryan Graves' card away. Fast forward, David Hornick has this amazing event called the lobby. I went to it and basically the lobby is based around the fact that most amazing conversations happen in the lobby of the hotel. It's not the content. It's not any of it other than that. And it's absolutely true. And it also happened in the swimming pool and the hot tub and the various things when you're offsite at a resort that happen. Like you go snorkeling together, you go swimming together. So a huge group of us were in a hot tub. And there's this guy, Travis Kalanick in the hot tub.

33:55And he had just exited from Red Swoosh. And he basically announced to everybody he was on the bench looking for his next thing. As an investor, you always pay attention when somebody says something like that. We trade on secrets. So I took stock of his personality and his personality was very alpha. It was very aggressive. You could tell that everybody sort of quieted down when he spoke. there's a lot of things you look for in a leader. And I noticed that. And so I thought, well, I'm just going to watch this guy and see what happens. So a few months later, I got invited to Open Angel Forum, which is a thing that Jason Kalkanis did for a while.

34:33And I'm sitting there and like the second presentation that comes up is Travis Kalanick presenting Uber Cab. And I wrote to my husband and I said, we need to invest in Uber Cab like today, right now. I don't understand what's going on with Ryan Graves, but it's kind of irrelevant. And we did meet Ryan Graves and we loved him. But we knew, or at least I knew, that Ryan Graves would step aside with a person like that. He's going to want to be the CEO or Ryan would even recognize he was the natural fit for it. I'm not sure what happened on the back end, but Ryan did step aside. He became the COO and the rest is history.

35:11And so there's an example of just being really curious and following the white rabbit, so to speak, down the rabbit hole. You take that curiosity and you see where it goes. And then you strike the moment you have that lightning bolt. The lightning bolt hit me when Travis got up. Yeah. Fascinating. So what price did you end up investing in Uber at? I believe that was$8 million. $8 million? That's the first round. So that one worked okay for you. Tell me the second half of the story. What is it like to be an investor and to hold on to a business that ends up being, I think, just hit an all-time high yesterday or something?

35:50Tell me about what that part of this is like. So there's the decision. And I remember talking to some of the early Bitcoin people that made the most money in Bitcoin. And one of the things that they had in common was that they were often already rich because once something 10 or 100 Xs, the pressure to sell something can be pretty high. and then the thing ends up 10 ,000 X-ing or whatever. So I would love to hear that side of this same story. You bought it, you're in an unbelievable price in a generational company. Then what? What was it like to watch, to hold, to engage with the company once you had invested?

36:24There's this beautiful period when the company is small and you can send emails to the CEO and they respond. And that's usually when they're under a hundred employees. And then that disappears and it's natural. Every angel investor, every early seed stage investor should understand that this could happen. Travis becomes more unreachable. Emil becomes more unreachable because you're not their most important problem of the day. They're fighting so many fires. And it's not because they don't like you or love you or aren't even thankful for that first investment. It's because they've got to run a company.

36:57And so there's this period after 100 employees that they lean on you a lot less. That's where you kind of just sort of surrender to the big players that are going to write the checks and hope for the best outcome. There's very little you can do. In the case of Uber, Chris Saka got involved very early. He rolled up his sleeves and he actually showed up to board meetings, to planning sessions, and they saw a lot of utility in that. And so that's one way that you could stay connected to the business. For me, that's not my style. I tend to like to be somebody's back phone and they call me whenever they need a door opened or they need something fixed or they want my particular type of advice.

37:41The uncomfortable part happens when the company does really, really well. And then suddenly everybody starts speculating about your personal wealth and starts telling you what you should do with it. And you start getting written up in articles and your privacy starts getting invaded. And that can be pretty daunting. That happened for a period of time. And then of course, when they go public, there's a holding period. And did you hold it this whole time? Like, were you still holding your original investment when it went public? Yes. Yes. I actually think that it's best psychologically for people to not think about specific outcomes, to set it and forget it, literally.

38:25To say, I will be pleased with whatever happens because that needle is going to move all over the place. There were times that we thought that our shares would be worth something and then the next day they're not. You're in for a wild ride at that stage. And so I just think you shouldn't become to attach to it and you should just come up with a plan for why did you do this in the first place and what are you going to do with that money once you have it. So this is something I always try to advise my partners and anyone in the investing spaces. Why do what we do if it doesn't serve a higher purpose or higher power.

39:05So if you are lucky enough to have an exit of any material means to you and your family, I think it's really, really important to align it with your North Star, whatever it is. You know, you see Warren Buffett do this. You see the most amazing people in the world, high net worth individuals who figure out charitable causes to support or how to align their investing by starting a fund and getting institutions that they believe in alongside them so that every dollar you write, you maximize that dollar. You're solving cancer research, or you're helping kids go to school, or you're helping a pension fund.

39:48Then you're actually really making a dent in the world through capitalism. And I think capitalism has like such a, I don't know, people use it like a dirty word. And I think it's one of the most beautiful concepts in the world that we have to protect because it absolutely can move the needle in innovation and change things on multiple levels. What is beautiful about capitalism too? Let me go back to it's my first time experiencing it. So when I was younger, I actually felt that business people were evil and they were exploitative and all sorts of things. And I'm sure there are business people who are those things.

40:34But when I lifted myself up off the streets, it was by selling necklaces and making t-shirts. So I realized I could scrape up a little bit of money. I could make a thing and a person out there could buy that thing from me at a markup. And then I could reinvest that into more supplies and make more money and literally get off the street. And to me, that was like, whoa, wow. Why can't everybody do this? Why can't they see this? And instead, what they see is various abuses of capitalism. Capitalism itself isn't just an idea. It's art. Art can be abused. All things can be abused. But at its core fundamental principles, it's extraordinarily liberating.

41:21To zoom to the maybe extreme outcome of what a capitalist says allows for. Your story would be remarkable if it was only Uber and nothing else, but maybe you can tell the SpaceX story. Oh yeah. The SpaceX story is a good one. So I worked at a company called Ironport and I was employee number 30. And it's the best company besides Founders Fund I've ever worked at in my life. The CEO there was incredible. His name is Scott Weiss and he built a true true meritocracy of a culture. It was the first place that I went to that I felt really valued for my mind above all else. And every time that they gave me a raise, instead of asking for money, I asked for more equity because I believe so much in this company.

42:08And so I was just like, give me more, give me more equity. That's all I want. I'll figure out a way to make ends meet otherwise. And because before that, I worked at many startups and the equity didn't turn into anything. Every one of those companies ultimately failed. So when I had my first financial windfall was because Ironport sold to Cisco for$830 million. I think it was 2007. I looked around to my friends and I was very fortunate to have made friends that were angel investors already. And my husband was an angel investor, had already been doing angel investments for 10 years. and he said, obviously building a company is one way to create wealth.

42:50And he said, but the real way that I make my money is by putting capital into high-risk startups. He's like, why don't you do that? And I was like, okay. And he said, well, why don't you go out and look for opportunities, see what resonates with you and come back. So I did. And I was very, very uncertain and very, very scared to put the money that I'd slept under my desk for into startups. But then Luke Noset came over to our house, who is a dear friend of my husband's. They went to college together. They dropped out of college together and drove west with walkie talkies because they didn't have cell phones and got an apartment next to each other.

43:31Eventually, Max Lepchin moved next door. But he came over and practically got on his knees and begged us for money for SpaceX. And it was his conviction and his belief in Elon Musk, this love that's indescribable. This man is going to achieve this vision. And then I went and talked to some NASA engineers and they said, what he's doing is solid. And the narrative violation there was a private entity can't enter the space realm, period, the end. This is NASA. End of story. The government will never allow him to participate. I put money in. I was like, you know what? I'm just going to put everything in it.

44:13Everything I made from my import, I put into SpaceX. And I was like, you know, I'm young. I can do this. I can make the money again. I can always join another startup. I can always figure out something else. I definitely had built myself a safety net so I could take that risk finally. So I did that and it'll probably end up being bigger than Uber by far. When you think back on these stories, are there lessons that you pull from them or do you just view them as sort of like crazy things that happened? I mean, the fact that you put all your money in SpaceX is crazy. I imagine, I don't know what the entry valuation was there, but I know what the current SpaceX valuation is.

44:57You can kind of figure out they've just blown up a rocket on launch pad and they haven't figured that out yet. And that can give you an idea of timing. I haven't done that in a long time. So I feel lucky, but I also feel like it's because what I do with the money, and then I'm going to go back to spirituality, that the universe tends to direct energy in places where people are doing good things with it. And so I think if I started doing bad things with it, my chances of luck diminish. I think the fact that I have a North Star and so does my husband and we believe in things like freedom, the U.S.

45:40Constitution, we believe in people being able to start businesses for ideas to flourish. I think these things are very important core values of ours. And it's possible that we are rewarded as such. Now, obviously, I can't prove it, but I really, really believe that I am a steward of capital that doesn't belong to me. It is mine to deploy judiciously, but is mine to basically put into innovation and into nonprofit work to move the needle on this earth to make everybody's lives better ultimately in the end. and I believe that as long as I continue to hold that hope and I trust my gut feeling which I believe is kind of divine my ego is aside like it's one of these things where I don't even think that I'm responsible for some of this I don't know if you've read the Rick Rubin book I compared myself to Rick Rubin online and I got a lot of backlash and it was funny to me because Rick Rubin is very, very similar to me because we trust these feelings that we have to make decisions.

46:53And for him, it's like, I found the Beastie Boys and no one's ever heard the Beastie Boys and they're going to love this. And I know I'm onto something. And for me, Travis Kalanick is the Beastie Boys. It's totally fascinating. It's also a good excuse to go back to what we started the conversation with around spirituality. How did you get into this? So now that I understand these sort of like following the white rabbit holes that you go down, what is this rabbit hole? And I don't know if you've made investments in this space or not. If you have, I'd love to hear how and why and what, but first tell us the journey that you've been on, the learning journey that you've been on.

47:29These are the ones that you've been described in this specific field of spirituality. Cause if I'm not mistaken, a couple of years ago, you were an atheist and maybe that's different now, but I would just love to hear the arc of that story. Yeah. So a few years ago, I was an atheist and like many people during the pandemic, I had a lot of free time to sit and reflect on, I mean, some people, I hate to say this, but some people didn't have the time because they were obviously frontline responders, but I was fortunate enough to sit down and think like, why is this happening? Who am I? What is my place in the world?

47:59And really, really figure out the why. Because for a long time, I really felt like we're supposed to just be good people, live a good life and make the best of it. And we just turn to dust in the end. And that's all there is to it. But the one thing I never tried was believing. I never tried actually having faith. You might ask yourself, how does one try? It's not trivial. Like you can't just say today, I try having faith. I actually had to figure out how to truly believe that the world is magical. And the moment that I truly believed that the world was magical, then the world became magical. It rocked the foundation of who I am.

48:43So I had a spiritual awakening, and it's the only way I can describe it. And I can tell you that each one of us is walking a very thin razor's edge between sanity and insanity at all times. Serotonin regulates a lot of how we perceive reality. I had a surge of serotonin and this lightning bolt like no other. It was basically this surge of energy that went from the base of my spine out the top of my skull. And suddenly everything in the world looked different. Everything. I started viewing signs differently. I started viewing art differently, conversations I was having with people differently. and I realize everything around us is a projection of our perception minds.

49:30We, when we're born, when we are born, we come online with like going back to parts work and things like that. But when we're born, we come online with about four distinct systems that come online. And then through stimulus of interacting in the world, we develop a personality. And we think this personality is fixed. We think it can't be changed, but it turns out it absolutely can be changed. Many parts of it can. How I had the spiritual awakening was the realization that all the trauma in my past was a construct of my imagination. That basically, yeah, it happened, but it happened like a dream happened, like a nightmare.

50:13A nightmare you wake up from and it's gone and you're relieved. You're like, oh, that was just a dream. But it turns out trauma is also just a dream. Because if you can overcome it and you can get past it and you can move forward, you have to realize that that thing, when you spin it up in your mind, creates all kinds of hormones that get released that shape your reality and how you see the world. We forget that we're an animal that has hormones and a mind. And then there's this really special thing called consciousness. And so I believe that consciousness is kind of like an operating system. and it brings these parts of us online that benefited us at one point that no longer benefit us because they have jobs.

51:01I think of them as kind of like processes that come online to assist you. They're like cron jobs, and they're like, I'm here to assist you, and we don't know to put them away and tell them that they don't have that job anymore. They don't need to do that anymore. so once I let go of this huge amount of trauma and I realized that it just didn't matter that these things happened to me in the past what matters is literally right now and you hear people say this and you wonder what does it mean when they say this and I always wondered it I was like what does it mean when you have the true realization it's almost like it's written in your DNA what that really, really means.

51:44Then you start to let go of so much. And when you let go, all of a sudden you realize, oh, life isn't so hard. It's actually quite easy. And I just have to trust myself and I have to trust my intuition and I have to just be. And once you learn how just to be, life gets a lot more simple. All of a sudden, everything you ever wished for in your life just starts coming true. It becomes effortless. it's really weird it's really super weird and the only thing that changed in my life was having faith in something higher than myself that was it this is why when you ask me like what sort of insight or brilliance or whatever led to whatever it's too easy for our ego mind to take credit for everything something gave me that feeling that said you ought to go deeper into this you ought to do this.

52:39You've got to take this risk. You've got to jump right now. I guarantee you, if you talk to a lot of different people, they'll say, I don't know why I did this. I just had a feeling. And I now believe thoroughly in that feeling. And I believe that that feeling is the universe or God, whatever word you want to put into it. And it helps guide me. And now that I don't egotistically attach myself to it, I am just a much happier person and everything is just falling into place. Speaking of spiritual beings, what did you learn from Bill Murray? Bill Murray is my spirit animal. About 20 years ago, I saw a film called Lost in Translation.

53:20And I thought, this is a person who feels so real. He's not acting. He is, but he isn't. Like I looked at his eyes in that performance and I saw a man who was suffering, who was dealing with some real life shit that was coming through the film. And not only that, but I felt my own suffering and I felt a connection to that suffering. It's like, kind of like when you look at a painting and you see yourself, I saw myself in Bill Murray. And so I did a Google search just to see like what he was up to and then saw that he was appearing at people's parties and was like spotted at somebody's dorm room or something like that.

54:04And he went into their house and just started washing their dishes. So it started this movement where people started putting out banners saying, Bill Murray, please come here. Welcome here. I thought to myself, what kind of man like him puts themselves into the general population like that? And I identified with it. I told you earlier, I go to these conventions and I put myself on purpose in uncomfortable positions just to absorb humanity. And I realized, you know, if you're Brad Pitt or if you're George Clooney, you could, it's hard to be these people. Like everywhere you go, you're recognized.

54:46Somebody wants to take a picture with you. Someone wants to touch you. Why would you subject yourself to this on purpose? And I became obsessed with that question. I started thinking about it nonstop. What drives this man? I ultimately decided it was spiritual, that in order for him to maintain his humanity, he decided to start teaching us all how to live. Now, if you watch what he's doing, he's showing you that even the act of doing dishes can be a joyful thing as much as going to a party. Going back to curiosity and joy, You can find joy in the most mundane of things if you try. And so he's showing us a really beautiful thing.

55:31It's not about the sort of prank of showing up at a house and washing dishes. It's about showing you that dishes are a fun thing. If you walk down the street and you just suddenly start dancing with someone, you're showing them. It's almost like they had a weird dream when they run into him. he'll take your french fry off your plate and he'll say no one will ever believe you

55:57and i think that i want bill murray to live forever but when he leaves this earth this go round tens of thousands hundreds of thousands of stories of bill murray are going to come pouring out and that man's going to look like a saint he is a saint of sorts you know he's a very difficult person to work with, I've heard, because he demands the best of people. He expects people to show up and give 100%. And his bar for talent and for art is incredibly high. But I can tell you how I met him. So I put my dream out into the universe that I want to meet Bill Murray. And someday it would happen. And I visualized it.

56:38And I said, and when I meet him, I'm going to get to ask him a question, just one question that's the most important question to me. If you do this, I guarantee you most of these things will come true, not in the exact way that you imagine they'll come true, because the universe works in its own mysterious ways. When I set out to meet Bill Murray, I did not have money. When I met him, I did. One day I was sitting on my couch. My favorite site to shop on for gifts for friends is Charity Buzz. and I was on Charity Buzz and all of a sudden this thing popped up that said, spend a day of golf with Bill Murray.

57:19And I was like, what on earth? No way. And I was like, I'm in the position where I could buy this. Do I do it? And so I said, yes, I do. This is my chance. This is the universe that just handed me an opportunity and I get to support charity at the same time. Like how beautiful is that? So I reached out to the organizers. I didn't know how to golf. That's the funniest part about this. I knew nothing about golf. I had never gone out to golf in my life. I actually had a pretty negative opinion of golf. I thought it was hoity-toity and only for wealthy people. And it just was not for me. And so I reached out to them and I said, I know this is a very strange request, but would it be possible if I just ride along with him while he plays and I could be his caddy.

58:06And so they wrote back and they said, well, he's willing to have lunch with you. And I was like, oh no, I heard golf is like a full day affair. Like I really want to know this man. Can I please just come along? And to his credit, he said, sure. He said, absolutely. So the day that I showed up, he paired me with his partner, Scott Simpson, who is an amazing man, just absolutely amazing man. For the first 10 holes I spent with Scott Simpson, brought my friend, And Emily Gillette is an amazing golfer because I figured one of us has got to be able to play. So I brought Emily and she was paired up with Bill.

58:41And a little over half of the day later, he comes over me and taps me on the shoulder. And he's like, didn't you buy this whole thing? And I was like, yeah. And he goes, don't you want to meet me and come for a ride? Or play golf with me? Because I was having the time of my life with Scott Simpson. So I go out and golf with Bill. And he was teaching me how to chip and how to putt and how to everything. and he was just so gracious and didn't care if I knew how. And he took us out to Clint Eastwood's golf course and I got to ask him my question. And my question was, how do you stay present? When I asked him, he stopped the golf cart and he gave me the stare and you could tell it just took him by surprise.

59:24It was not what he was expecting out of this whole ordeal. All of a sudden he points to the hill and he goes, turkey. And I go, what? And he points to the hill and he goes, turkey. And I was like, okay, turkey. All right. I looked at him and we start talking about this turkey. And he was like, he called it a he. And so I joked and I'm like, you don't know the pronoun of the turkey. And so then we got talking about that and joking with him. So then I came back to it again and started talking about it again. And he goes, tree. He points over to a tree, tree. And I was like, yeah, that's a tree. And it became very clear he wasn't going to answer this question.

1:00:00What I didn't realize in that moment was I got my first lesson from Bill Murray, which is how do you stay present? Notice what's around you. Marvel in it. There's a freaking turkey in front of us. Like, how often do you get to see a turkey? Not every day. Why do we take the turkey for granted? Why do we take the tree for granted? At first, I was like, I'm not getting the answer and this is frustrating. But later on, when I reflected on the day, I realized he did answer me. I got my answer. It was just an incredible, valuable lesson. And it definitely helped me on my spiritual journey in a way that is just so profound.

1:00:40Can you tell me about the violin kid? So this goes back to just following your curiosity. I have a friend named Michael Tiffany. He's a wonderful entrepreneur and somebody I've known for a long time. And we go to DEF CON. So I've been going to DEF CON since DEF CON 4, since I was 18 years old. we were fantasizing a few years ago that wouldn't it be cool if we hired a violinist to follow us around and just sort of play a soundtrack wherever we went because I'm really into performance art in general and I thought it would just be really funny if you just show up to a meeting and you're like hold on my violin players here have them play it'd just be eccentric and odd just kind of a funny thing and so we daydreamed about it joked about it and put it away we're walking through DEF CON and there's a young man, boy, he was 16 years old, 15 maybe, playing a violin and it's so beautiful and he's busking in the middle of this conference.

1:01:39And in front of his violin case, it says raising money for a certification course. I asked him, I said, how much do you need? And he's like, I need$2 ,000 to take this class. And I said, oh, okay. And I said, huh? And then I turned to Michael Tiffany and we start walking. He goes, are you thinking what I'm thinking? And I said, I'm thinking personal violin player for the day. What are you thinking? And he said, I'm with you. And I said, he goes, you want to go Habsies? And I said, yeah. So we walked back to him just as the conference was about to shut him down and tell him to close his violin and get the heck out and said, we're going to pay for your class, but here's the deal.

1:02:18Are you willing to follow us around all day and just play music for everyone wherever we go? Because the conference didn't care that he was playing violin. They cared that he was asking for money is really what it came down. They didn't want that to become a thing, but they absolutely love that he was playing violin. And he asked his dad and his dad was like, sure. So he and his dad just ended up going with us all day long. We went into the conference hall. He would just sit there and play music. When we were walking down the hallway, he would play like the Imperial Death March or he would play Game of Thrones.

1:02:50You know, it was just really fantastic. And it changed his life. He was able to take that class and he changed our life. And it was just miraculous and beautiful. And it just goes to show you can do these things. We can all create magic in the world for other people and for ourselves if you think about a situation and you act in that moment. You strike me as an incredibly evolved human. And I'm curious that given it's been quite a while since you made those Uber and SpaceX investments, obviously unbelievable returns earned from those and many others, how your investing is most different today, if at all, from when you made those kinds of investments.

1:03:36And maybe it's an excuse to talk a little bit about long-term ventures and what you're building there and why you're doing it. But I'm just so interested to know how your practice has evolved alongside your own evolution. Yeah. So I think when I first started investing, I made a lot of mistakes. We hear about the wins, but you don't hear about the losses because you're really tuning your antenna in the beginning. My first check ever obviously ended up being a wild success, but there was lots of checks after that that did not. You have to accept those failures as a lesson as you go forward. and then internalize those lessons.

1:04:15What did I do wrong? What did I not see? It wasn't out of my control. Did I still do the right thing, but then it was the wrong timing, et cetera, et cetera. And then you hone that into your gut feeling so that when the next time comes around, you can make hopefully a better decision. Now I've been at this hundreds of companies. I was at Founders Fund, obviously was on the investment committee there, have seen many, many, many deals. my antenna is getting better and better and better. I think my job now is to teach future generations how to trust their gut. So when I left Founders Fund, I joined Lee Jacobs at Long Journey Ventures, and he's a decade younger than me.

1:04:58He's just starting out and hitting his stride. He's been at it for a while, but his early investments are starting to bear fruit. For example, he was a seed investor in Loom and Loom just exited. So he had his very first exit. So he's got his first story right now, which is really, really exciting. And so my job is to hopefully help him and inspire him to, one, I have no doubt he's going to be wildly successful. Same thing with Ariel. I just want them to follow their North Star in the end, which is what causes do you care about? Where as you are successful, you can make a real dent to them. In the beginning, it was about making the money and continuously deploying the money and the causes that I was supporting through the actual companies themselves.

1:05:51But now I'm starting to think about all my actions. How do they help the bigger whole? So sometimes you'll see me doing things with companies that we have very small investments in and you'll see me putting a lot of time into it, even though I know that the returns aren't going to be huge because it doesn't really matter. That person's out there doing something incredibly important. It's not about opportunity costs. I'm a firm believer in whatever you put out in the universe comes back to you. You know, if you do good things, good things come back. It's just how it works. So what's changed for me is just being more methodical about my time, how I'm spending it, who I'm spending it with, what kind of vibrational energy is around me?

1:06:34Am I lifting up the vibrations of the world around me? Are they lifting me up? And so forth. And that's all I want to focus on because I just want to make a venture firm that's going to be around long after I'm dead. And my spirit is inside of it somehow. It lives in the values. It lives in the discussions that we've had. And so I believe that our thesis around investing is the combination of the three of us, but my spirit is definitely in there. Founders Fund has a spirit. It comes from Luke Nosek, who was one of the original founders of Founders Fund. He dared to disrupt the venture industry to create the first truly founder-friendly venture firm.

1:07:23And this is not about being value-add, by the way. It was about not ever firing a founder and removing them from their company. That's it. That's their biggest value proposition, which is they will not mess with you once they've invested in you. That seems like kind of a simple thing to hang your hat on, but it's actually in the end comes down to be incredibly important as they think that the soul and the spirit of the company lives in the founder. Just yesterday, I talked to one of the Founders Fund partners about an investment that we're looking at. And I asked him a question, which was like, what attributes do you think matter in the next investor for this business?

1:08:02Because obviously we all want it to succeed. He laughed. He said, well, the attribute that we want is that they leave them alone. You know, we believe that most of these investors are kind of useless and they just waste people's time with their supposed value add. It's such a funny thing to think about, but it makes me wonder about your lessons or experience with the professional investing world. So much of what makes you so interesting to me is just so different than the institutionalization of an asset class, which you hear a lot about as it relates to venture these days. And there's so much money flowing around.

1:08:40So of course, supply rises to meet demand. But I'm really curious how you would assess this whole world, the good, the bad, the ugly, having now been in it quite some time. Yeah, my philosophy isn't quite as far as Founders Funds. Founders Fund is like, we invested in you and now you're on your own. And it's your job to extract value from us. A certain founder loves that because they know how to get value. They look at that group of people and they know who they're connected to and they know what to ask for. We are a little bit to the left of that if they were on the far end of the spectrum. We are more hospitality oriented because I think at the seed stage, being hospitality oriented is important.

1:09:25What that means is one of our values is be a Bubby. Bubbies are grandmothers who give you hard advice, but they love you. And so our job is to give honest feedback to the founders, but give them unconditional love. What a founder needs to hear is the hard stuff. They need to hear like, you're not performing compared to the rest of our portfolio companies of the same vintage, maybe in the same space, or this person you've hired is probably not cutting it. The other thing is to letting them know when they have done amazing things that you notice. and giving that feedback just like a bubby would do.

1:10:07Then being there for them in the hard times because the one thing that all CEOs are afraid of is really revealing all their cards to investors because it could backfire. That's why they always say, it's always up and to the right. Everything's great, we're killing it. And then you later on find out that's not really the case. If you can form a true relationship with your founders, they're gonna tell you when things are not going right because they want you to lean in and help. We want to be there when you've had a loss in the family. We want to be there when your best friend, something happened to them.

1:10:42Because we are human beings at the end of the day. It's a mental game. So we do a lot of things around like mental coaching and presence of mind and things like that with our founders. We think that all the rest of it is got to be a core competency of the company, right? Like we're not going to help with marketing. We're not going to help with hiring or any of these things. unless we have a candidate that lands on our lap. And then we do place them in companies. We absolutely do do that, but we're not gonna go out and be recruiters. All of that needs to be core to your business. And I think that's what truly matters, especially at the early stages.

1:11:18One of the things that Justin Maris told me to ask you about was integral family systems. I'm fascinated to know what you've learned there. So I was talking to Justin and my partner, and they said, you really should look into IFS and try it out. So then I tried it out and I went in skeptical and came out realizing, oh my gosh, how amazing is that? For people that don't know what IFS is, you basically view all your parts of your personality as there are no bad parts. Every part is there to serve you, including the ones you might not like. And they come online to serve you because they're trying to defend you and protect you, yourself, that's underneath all of that stuff.

1:12:02And when you start treating them as separate entities and have curiosity about them and start having conversations with them, you start to realize they're automatic processes that come online that you can then give them other jobs to do. And you can change your personality permanently for the better. I've gotten rid of some behaviors that I thought were unchangeable through IFS, nervousness, types of nervousness, types of reactions to people talking to me and realizing that these were all just automatic functions of how I show up and react to any kind of perception or stimulus in the world. And it wasn't about the person I was dealing with.

1:12:44It was about me. In general, it's usually all about how you handle anything coming at you. A friend of mine said something really powerful to me once, which was, if people are coming with you with anything but love, it's not about you. Do you still feel fundamentally flawed in any way? Absolutely. Absolutely. I feel flawed. You're going to hear people talk about, when they talk about spirituality, about being asleep. and what being asleep means is going back into your mechanical automatic reflexes of reacting to life and just sort of not being truly present and if I have a flaw it's just the flaw of being human and not realizing that I'm not being present in the moment and so that's something that I want to grind away at and fix over time.

1:13:36I think that sometimes I can be reactive to things in ways that I wish I wasn't. So I'm working on those things. None of us is perfect. I think the whole experiment of life, if you are an infinite being, let's just posit this for a moment. If you're an infinite being, being in a body is meant to basically give you artificial constraints. and what if it was possible that maybe you even chose these restraints? I want to be in this situation. I want to overcome this adversity. I want to have this hardship. I want these things and I wanted them. And so I've got to figure out how to get to the other side of them.

1:14:17So all of our imperfection is just a lesson. That's all it is to me. This is kind of a weird one, but if you had in a checking account, $1 trillion, what would you do with it? I would disrupt the Hollywood industry. I would reimagine the studio system and I would build a company around it. Say more. Why? What about it? You've got to look back at Hollywood and how it was founded. The old studio system, all of the artists used to work for the studio and they were on payroll. And then what happened was they became wildly successful and then fans loved them, but they had no upside. So basically they had no way to really capture any of this fan engagement.

1:15:05So they couldn't get money from public appearances and things like that. Along came Michael Ovitz and turned that on its head and created something called CAA. I just had him on. It was a very fun episode. And Michael Ovitz is the best. I love that man. and he reimagined how an industry could operate and he put the power back in the hand of the artists. That's why it's called the Creative Artists Agency. And he fought for these artists and basically started packaging these deals that were full packages where they developed everything and then worked with the studios on financing and distribution.

1:15:39It's still that way today. And unfortunately, kind of like all protectionist rackets that exist out there, they don't wanna adapt to the times and the times are changing. And now we have Netflix. You know, in the beginning, they were pretty short-sighted. They thought that DVDs coming in the mail was like the holy grail. They didn't see where the evolution of this thing was going. Kind of like Napster disrupted the music industry and we ended up with Spotify. We haven't ended up with a new model for how studios operate. We're starting to see some interesting things happening with like NFTs and Web3 and distribution techniques for content that have never been tried before.

1:16:23Whenever you have gatekeepers who are the only people who are putting out content, that means that there are millions of voices that aren't heard. And I believe that every voice has a chance to be heard and ought to be heard, even if you don't like what they have to say. because how else can we get to the right answers if the full discussion isn't happening? So the movies that we're seeing right now are dumbed down for general audience appeal. They're made to make the most amount of money possible, but they're not made to teach you potentially how to live your life differently or to question yourself.

1:17:02Art has an amazing way of moving the needle of culture and for opening people's minds and hearts to subjects that they might not have otherwise thought about. And so I'm afraid right now we're in kind of a monoculture where there's only a few people making content and they have an agenda. If you look at a lot of this content, it's being censored by the CCP. We're not even allowed to criticize China in any of our film. We should be allowed to criticize China in our films. That should be okay. And the fact that we're not alarmed by this to me is kind of nuts. I would want to bring transparency to accounting and the studio model to where everybody understands the waterfall and understands who's getting paid what and how.

1:17:51I would love to give power to artists and to the early believers in that system. So for example, in venture, angel investors can invest in a company and we have a lot of upside protection. So if later investors come in and save the day of the company, maybe they have some preferences, maybe some things happen where they get rewarded. But you should never screw over the first people who believed because you would have never had the opportunity in the first place to invest later on if you screw over those first people who believe. Hollywood is totally based off of screwing over those first believers.

1:18:28And so there's a lot of people who put money in or wrote a script or did a lot of things that they don't ever recoup that money. It's only the later stage investors who do. I just really, really think the ideas have to flourish. I'm a First Amendment nut. I donate money to the UCLA Amicus Brief Clinic down in LA. And I'm very, very, very drawn to that cause. And so a lot of the philanthropy that I do in the first place is around the First Amendment. So if I had a trillion dollars, it would be to go after Hollywood. The next thing would be create a school of comedy. where we train the next generation of comedians because I think that what the world needs more of is laughter because this is how we let out steam about what's going on in the world.

1:19:16We're all too sensitive right now. Everything is offensive. We got to stop being so concerned about the words that people are saying and learn to think for ourselves instead. Figure out what our inner voice is, our true north is. And then it doesn't matter what people say. It shouldn't even hurt you. I would say that a trillion dollars is a lot of dollars. It's meant to expand the mind. Yeah. I mean, I probably would try to work on legalization of mind expanding substances, MDMA, psilocybin, et cetera, probably put more money to work behind that. I probably would try to work on incarceration rates, people that are in prison for causes that cause no harm to anybody to free those people.

1:20:00I probably would plow a majority of it back into startups. If I was asked to describe you, one of the things I'd probably say is every time I see a text from you, I know it's going to be something interesting that you've uncovered. It's almost like dispatches from the future or something is how I think about it. And I would love to know just as we wind down, what fun dispatches from the future you're seeing today? Gen Z and Gen Alpha are incredibly freaked out right now about AI. Rightfully so. A lot of them are going to school and wondering why they should even bother. We're not paying attention to that despair.

1:20:38They're like, why am I learning these things when I can just go to chat GPT and ask this question or create a report with chat GPT that's good enough? Or why am I learning how to code when there's copilot or these things that are just going to generate code and create apps just because someone dreams of it? Like, why am I learning the intricacies of how all this works? And so one of the things I'm deeply thinking about my dispatch from the future is how do we create a world where people understand nothing is going to be more valuable than what's created by human hands in the future. So in a world where everything is quick, cheap and flawless, the things that are flawed have value.

1:21:17So I don't know if you've ever read the book, The Diamond Age. Of course. Lady's Illustrated Primer, right? Yeah, exactly. Exactly. So we're heading into the Diamond Age. Borders of countries are being questioned. Democracy itself is being questioned. Do we create files of societies through crypto where people subscribe to a certain type of living like the Victorians did in Diamond Age? And do we have material matter printers that print everything we need on demand? if everybody has most of what their needs are met, what's left? And what's left is artisanship. And so I think we're moving into a great age of artistry like has never been seen before.

1:21:59And the big argument that's coming is whether or not AI created art is really art. I argue that it is. I argue that an idea that someone had in their mind that they didn't have a paintbrush to bring to life, now they have that paintbrush. Now they can take that idea and synthesize it into something that people can see and express themselves in ways they never were able to in the past. Now, did they not spend 10 ,000 hours honing that craft? For sure. But does it make them not an artist? No. So my dispatch from the future definitely is going to be around Gen Alpha and what we do for them and Gen Z to try to make sure that they understand they have a future and to start investing in that future now so that those platforms exist so that they understand where they can participate in this new economy that's coming.

1:22:54Well, I could talk to you all day long. I think you have such a fresh and interesting perspective on the world. Obviously, you've been one of the more successful investors of this era. that we've explored a little bit, but we could explore plenty more. But I'm forced to go to my traditional closing question. What is the kindest thing that anyone's ever done for you? I've had so many kind things done for me in my life that it's so hard to pick one, but I'm going to pick this one because I was hitchhiking on the side of the road when I was 17, 16 years old. I think I was 16 in Albuquerque, New Mexico.

1:23:28And I'd gotten kicked out of Denny's because I overstayed my welcome in there with the bottomless cup of coffee. And it was in the middle of the winter. And I went into a gas station and I got kicked out of the gas station. I ran out of options. So I went out to the freeway and stuck my thumb out and started hitchhiking. I got hypothermia and I started feeling my body shut down. And I knew I was probably moments away from death. And that's when an RV pulled up. I was with a boyfriend at the time. He's like, God told me to stop for her. Not you. He pointed to my boyfriend, which was kind of mean.

1:24:04And he said, but her. And he said, but since you're with her, just get in. And so they picked me up off the ground because I was not able to move anymore and brought me into the RV and put a blanket on top of me. And he gave me hot chocolate. And he said, where are you going? And I said, I'm going to Flagstaff, Arizona. And the next thing I knew, I woke up and I was delivered to the front doorsteps of my mother's home at the time. And so that act of kindness saved my life. It was a complete stranger. He told me that he had circled past me probably eight or nine times, gone off the off-ramp, on the on-ramp, off-ramp, on-ramp, thinking that it was crazy that he was getting this lightning bolt, going back to lightning bolts, to save my life.

1:24:49But then he was just like, I realize if I don't stop, she's going to die. And so he saved my life. And I'm so thankful to him. I don't even know his name because he just dropped me off. I slept through the whole ride. But it was that act of kindness, that act of giving to a complete stranger and listening to his gut feeling that I'll never forget. Wonderful closing story. Thank you so much for an awesome conversation and for all your time. Yeah, thank you. If you enjoyed this episode, check out joincolossus.com. There you'll find every episode of this podcast complete with transcripts, show notes, and resources to keep learning.

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