EP 144: Jeffrey Katzenberg & Sujay Jaswa (WndrCo) on What Startup Founders Can Steal From Hollywood

28:09But we've never had it. Yeah. I mean, by the way, we're not right all the time, obviously. I wish we were. I think the. The process is very much. I mean, it's kind of we're all doing the same thing, right? It's you try to build as prepared a mind as possible. That prepared mind process comes from fundamental research, market mapping, playing with every available new innovation you can. But also just talking to smartest people in the network, talking, collaborating with other people. We're very collaborative. We're not in the you know, this is our ball. We're you know, we're trying to grab all of it.

28:41But it sounds like you guys err on the side of consensus rather than, hey, other groups will be a little bit more IC-oriented, where someone gets a silver bullet or they take feedback from the partnership. But then ultimately, it's their decision if they really want to push it through. We've never worked that way. We're like a management team. Yeah. Yeah, yeah, yeah. And I guess it sounds like a lot of this group has been together for a long time. Anthony's been there since the beginning. Actually, Anthony was one of the people that connected us in the beginning. Anthony is one of my son's closest friends.

29:13Oh, is that right? Yeah. So there's implicit kind of trust in the group. We've been through plenty of ups and downs now. Yeah. You know, like, and we stuck it out. You know, it's like so much of this industry is about grinding through the hard times and capitalizing on the good times and then grinding through more hard times. Well, there's like two different models. I would just say, Logan, for me, the test of a partnership is really how much do you look forward to being together, literally. And I just have to say, in the case of every one of our partners, I'm happy when I'm with them. One of them, all of them.

30:01I literally, they are, you know, they're wind beneath my wings. Like, I just feel like I'm excited, challenged. and you know when somebody take family out of the equation if you have a handful of these in your life you're very lucky when somebody walks in the door like a great friend or a partner or a colleague and you're just like happy to see them I feel that way about our five partners I'm like I'm just happy to be with them in it and out of that you only find you find things to succeed together at. It's not about taking down. It's about building up. Yeah. Well, and I sort of think there's two different constructs, plus or minus in the industry.

30:49There's sort of the cherry-picked model, which a lot of venture firms will look to the outside more often than not and try to pull people in. I was at Battery for six years. Now, I've been at Red Point for five and a half. They were looking for someone and they pulled me in. Now, my two partners have sort of grown up within the firm. But more or less, I think some Some firms kind of gravitate to looking to the outside and some firms gravitate to looking to the inside as they evolve over time. It sounds like initially from the ground up, you guys were opting into people that you wanted to work with, that you knew network wise, that you knew from.

31:22Well, we didn't. I mean, we bet. I mean, that was, you know, you go back to nine years ago, the gamble, particularly on the people who gave us capital, was most partnerships don't work. Yeah. You guys get along. Yeah. Totally. Like literally, we couldn't be more different. Did you guys do trust falls and stuff to like, you know, like we were ropes course? Like how did you guys get the - We just jumped off a bridge and stuff. But I mean - It's Butch and Sundance. Yeah, yeah, yeah. It'll be okay. You guys talked every day though and just sort of built the trust over time, had enough commonalities.

31:54You never know until you go through really hard times. Yes. Good times are easy. Things are like, you know, should we shut this thing down? Yeah. You know, that's when you know whether you want to be partners with somebody. Yeah. And, you know, Chen Lee and I had it in the way Anthony, I had it because we had several years together. You know, Jeff joined in 2020 or 2021. But I knew from knowing him for so long that it would be likely to work. But you never know. But, you know, the thing that was the big risk, as Jeffrey said, was whether he and I would really. And it's been I mean, he's like I mean, I don't want to say he's like a second dad for.

32:28Yeah. You know, it's he's amazing. Well, that's what I really validate, especially with emerging managers like, you know, when they're underwriting to a first fund or whatever, it's like we're underwriting the risk that a partnership blows up. And a lot of them do, by the way. Most, by the way, in life. Life. I mean, you know, as I said, you go back and I can go, I could have gone on with the analogy about partnership and just say, I just had my 50th wedding anniversary in Hollywood. Yeah, wow. Not too many of those. I think I'm a true unicorn. I was going to say, those are a billion. You know, and so I really I just like I think about partnership.

33:07I think about friendship. These are things that are just so foundational. And I think about how, you know, character. And so one of the things that I love about Sujay, and it's so interesting because to find these two qualities in a person, one person is in itself a unicorn. It's a contradiction, which is in order to be a great investor or for the most part of my career, a picker, you have to be able to do these two things. One, you actually have to be able to see a dream. Somebody tells you an idea, right? And if you're not a dreamer also, it's not going to be possible for you to actually, for a moment, put yourself in their shoe and see their dream and understand what that might be if it actually realized itself in it.

34:13On the other hand, most dreams don't come true. And you need to be skeptical and cynical. So think of the contradiction of being able to see a dream and also being able to be skeptical and cynical at the same time because it's about filtering through, you know, what are the best of those in this. And the thing that is we laugh about because, you know, a day in the life of Sujay is, I love this idea. It's the greatest thing I've ever heard. This is a stupid idea. We should not be doing this. Aren't those the same idea? Oh, yeah. Yeah, yeah, yeah. Multiple times a day. Totally. But his process of how he sorts through that, and he's actually quite verbal about it.

35:02Yeah. So if, you know, the one day it's like, okay, well, the world's blowing up, sky's falling, then we are dead meat. Yeah. That might be today. Hey, you know what? The sky might be falling, but that's going to be good news for us. Yeah, yeah, yeah. You're like, CJ, lie horizontal on the couch. Yeah. If you talk to my wife or any of those people at Dropbox who work for me, I mean, I think they're described as schizophrenia. We can laugh about it, but yeah, the medicinal stuff and all that. I guess I'm curious, you referenced earlier, obviously, a great partnership wife, 50-plus years, Eisner, Diller, all the different people that you've worked with over the years as well.

35:38What do you think, maybe what's counterintuitive about making a partnership work? or what's something that's non-obvious? Not, okay, trust and some of those things that maybe are, of course. Well, I can tell you about marriage. I'll start with that one. I guess that's actually the simplest one in a way. And, you know, so I am asked all the time, is there any, is there a secret to, you know, 50 years? You're like skipping the after party or something? No, it's actually simpler than that. It's just two words. But yeah, it's, yes, dear. Yeah. It's not hard. Okay, so that's marriage. In the rest of life, I would just say to you, fundamental to partnership, any and all partnerships, is you must be more of a giver than a taker.

36:28And I actually think that's true in life. I think the greatest satisfactions and rewards come if you can actually find more satisfaction from giving than taking. And we could go take that analogy, throw that equation through almost anything in this. I am just in everything try to be, and I don't succeed at it all the time. I try to be generous. And by the way, I can't say that I had those attributes earlier in my career when I was fighting to get to the top of the Mount Everest and, you know, along the way. And I'm sure people would say that, you know, I played hardball and was, you know, bare knuckles and blah, blah, blah.

37:17And I'm sure that's perceived to be true on the other side of it and probably was true to some degree. I don't think you win in that world without, you know, getting into some knife fights along the way. But over time, I really came to appreciate and understand the rewards of giving. But in business, in credit, in philanthropy, most rewarding thing in the world to be able is to help somebody else. What surprised you about moving into tech, like directly? Silicon Valley, obviously you were exposed to tech and all those stuff you did before. The pictures are antithetical to one another. They couldn't be, they could not be more different.

38:00Cutthrovers is collaborative. I don't think it's that. I just think that one is very introspective and the other is sort of much more externalized in it. And so there's there's a there's a way more social networking, cultural networking, knowledge like it's it's you know, they really are just so, so very different. The work ethic and, you know, the heads down, you know, founders in tech are, they're unique. They're impressive. And, you know, so there's just a different dynamic there than I think exists. You know, the cultures of the two worlds are really quite different. Presumably you've gotten exposed to some of the stuff in all of this world.

38:58I know you guys, I've heard you guys do a wonderful conference for founders as well. I think that brings in different media folks or Hollywood folks. What's been interesting to get exposure to that world that I guess you think maybe within our industry we could have a little bit more of? You can say nothing, too. Well, I actually, I've not really thought about it in the sense of like what we could do better, but I do think the thing we sometimes underappreciate in tech is the value of beautiful things. Like one of the most interesting things to me about people from, call it Southern California, but you know, the world of media is that they are very tasteful.

39:47and there's just they bring they sort of elevate environments that they're in and there's a magnetism to them as people in terms of what they say how they communicate and i think you know we're all nerdy folks up here you know in our world right and it's like you know i think obviously you do a great job with with with this as a platform but in general our crew is like very as jeffrey said internally focused and we tend to talk to each other, hang out with each other, you know, or, you know, we'll go hiking. But these folks are influencing people at a human level, not impersonally. And I think it's pretty interesting.

40:23I think the people in the media and entertainment are more vulnerable. And so the emotional aspects of them, good and bad, are much more extreme. So on one hand, there's enormous empathy out of many of them. And out of that comes philanthropy and doing social good and they become activists and stuff. You know, on the other side is, is, you know, sort of outsized egos. Very, very, very needy. Very. Super needy. And super insecure. Much more so than I would you experience in Silicon Valley. And so it's just, as I said, it's just, they are different. Yeah. No question about it. And they love being like the people from one of the things we have tried to do is to bring those worlds together.

41:16And what's fantastic about it is, is that when the media, entertainment, movie, TV, sports, music, people get to be with, you know, tech, tech founders, CEOs, they love it. And they don't get off. They don't get asked very often. Right. And so that's one of the things we've done is that we've brought these worlds together, both of which, all three of which appreciate one another more than they recognize until they're there. And then they light up and they go, wow, these are really interesting people, all sides. You know, it's funny, but as you were saying, this kind of light bulb popped in my head, which is what I think the reason that insecurity might be there more on a human level is, you know, let's say one of us starts a company and we build a product and nobody wants to use it.

42:03You know, you take that very personally. Like, this is your work. For a lot of these folks who are in the entertainment world, if people reject their product, that's them. They're rejecting them as human. And in a sense, it's like they're rejecting my humanity. That's the way I feel about a buddy who's a comedian. And it's like I can go assess his job on a Friday night. I can go to the comic club and look how he's doing and be like, yeah, no, not great. Didn't find it that funny. No one really gets to do that for me. They don't really know when we got in and what valuation and how the company's doing and all that.

42:36But even if one of them doesn't go well, you've got a portfolio. It's not you personally. It is not me as a human. It's like, hey, you may be making a bad decision. It's a pure decision, exactly, which is a different thing. But here's the thing, which is, you know, failing has a stigma in movies, TV, sports, and music that is, as Sujay says, is quite personal. And so, particularly in the culture and the world that we live in, you go up and you go down. Yeah. And they are severe. Femerality of. And I've watched it so many times with so many people over so many decades. Whereas in Silicon Valley, if you took a great shot and it didn't work, great.

43:19Start again. Right. Like failure. Doesn't have the same stigma in this. I'm even to the Quibi, you know, the one truly, you know, big swing and a miss, you know, that I took in the media space in this in Silicon Valley. it was like, wow, it was a huge idea. It was a real genuine moonshot, you know? And, you know, you can't hit a home run if you don't swing for the fences, right? And this was a swing for the fences. And people in Silicon Valley were like, you know, okay, it's too bad it didn't work, but it's not because it wasn't a great idea and that you did every put your heart and soul into it.

43:57And then, by the way, when it wasn't working, you shut it down and gave people as much money back as you could. In Hollywood, it's a black eye. It never goes away, literally. And it, Unfortunately, I don't care. But literally, Sujay will tell you this five years later, and there's just simply never anything that's written about me. At some point, you were going to get to Quibi. I actually, I figured you guys, there's enough forums of answering that question. Listen, I have been given way, way, way, way, way either so much or too much credit for all the successes that I have had in my career, more than I deserve.

44:35I'm okay owning my failures. Yeah. You know, fortunately, there are way, way, way fewer of them than there are the other. And so you can't have it one way. You got to take both. Yeah. If you're going to own your success, then you got to own your failure in this. And so I, again, I wished it had worked. But I'm certainly proud of the shot that we took. What has you guys excited these days? i mean obviously all the stuff we're all collecting hey we all know that it's a platform change the first meaningful one you know and the reason 2008 2010 12 were such great years for our industry was you had you know social media you had the cloud you had mobile devices and so it enabled all this amazing you know product development that solved big problems for people at home or at work right and then we've all been kind of waiting yeah for like 15 years we've been waiting basically aws and and uh and the app store kind of launched around oh seven and marketing on social media and marketing on social media acquisition on social media right yes so those three things like fundamentally changed literally everything yeah and so you could build businesses doing anything and do something magical yeah and so we got the data dogs and the crowd strikes and we got the bite dances and the instagrams and the whatsapps and Ubers and so many, right?

45:57Like, and, and all the enterprise business. I mean, it's just crazy what we've got. It feels like this is that time again. And again, maybe there's too much hype. Maybe the bubble's too big, but this one is for real. You can see literally transformational, not evolution, revolution out of the power of, you know, of supercomputing and AI and these apps. I mean, it's just, it is a change the world moment. And we're seeing things that are exciting. No question right now, it's a bit too frothy. Feels that way. Mostly feels like it's just gotten ahead of itself a bit. But that's not to say it isn't a sea change.

46:47It is. The internet got ahead of itself. and we still had Google and eBay and Facebook and Amazon. And all these things happened. And my guess is net-net, it was still like an outstanding... Oh, for sure. Even if you indexed 1995 to 2000, as much as the commentators like to make fun of the excess, I bet you still did great. Yeah. Interestingly... If you indexed it. If you indexed it. If you indexed it. And that's the interesting thing is you sort of had to get into... Everything. ...the eight names that really mattered... ...that powered through. And some of them actually came later. If you look, I mean, Facebook came a little bit later.

47:17Google came a little bit later. So, yeah, it's interesting. No, Google was 98, 99. 98, 99. Yeah. Yeah, 99. Yeah, but I guess it was on the later part of the internet wave. Like, I guess if you were to time base, if you were to index against Netscape and ChatGPT, we probably haven't. Google probably hasn't been founded. I think it was Netscape was 92, 93, and Google was. Maybe 95. Yeah. Yeah. And so. 94, 95. So I think we're around the time of, if ChatGPT is the Netscape moment, we're probably around the time of Google getting started, which is interesting to think about. Yeah, I just think it's going to happen.

47:54I just think distribution is so much more compressed now. There's an acceleration. There's an acceleration. Yeah. I think, again, we're just going to see. Human creativity is being unleashed in these kind of new ways. I think we'll find out. We like to remind everyone internally over and over again that at the end, and we've been doing this since the beginning, But like at the end of the day, there's probably around the world five to 15, five billion plus companies, you know, ultimately five billion dollar plus companies created every year. Yeah. And, you know, in our in our typical portfolio, we're talking about 25 companies, 20 of which five are billed.

48:27So take those out. But of the 20, which is three years, period, we got to get at least one or two a year. That's that's our job is to get at least one or two of the five to 15 every year. and even in the middle of a bubble I guarantee you there are going to be Google's created and things like that and so in general I think being cynical in our world about excess and bubbles is a silly, silly, silly game I think on an individual you can sound really smart being cynical people who can put out negative critical things about anything always sound smart you're probably going to be far more you'll be right on a percentage per time on a percentage basis but when you're wrong to really in a power law business it turns out it doesn't matter if you're wrong 99 times it's that one time that makes all the difference you know it's funny because i mean i i didn't realize you never get your money back in venture and so i you know from you know in 2012 i started to write yeah so oh there's this carry thing yeah yeah well no it's so even before this is even worse than being on the venture side because because in 2011 i think i started a program where everyone at Dropbox could sell some percentage of their holdings.

49:39And so we had liquidity starting around then. And so of course I would start investing in all the venture funds. And so I invested in dozens and dozens and dozens of venture funds. Probably good vintages, all things considered. On paper, they should be amazing. Yeah. Better than 2020. Yeah. But then you fast forward and I'm still like, dude, what am I going to get my money? Give me that principal back at some point, you know, kind of thing. It's been 15 years. But the funny thing is when you look at the underlying portfolio companies, it's amazing, but it's still one out of 50. Yeah. One out of 50 investments.

50:11One out of 50 investments in a fund will be amazing. And by the way, that one out of 50 is going to return, in some cases, 1520x on the fund. But boy, that's 49. Totally. A lot of losses. A lot of losses. I don't know if I have the mental fortitude to do super early stage investing because you have one company that goes really, really well. And then you mostly, there's a lot of cheer. There's a lot of money leading going on and like, yeah, keep doing more of this stuff. And of course you help and I'm making it simple. And then there's a lot of shitty board meetings. And you know what? Like the proportionality of pain you feel, it's like that loss mitigation framework or whatever.

50:47You feel pain two or three times. It's like worse than you feel success. It's an interesting thing. Yeah, I was actually looking. Are you like that? Are you wired to like if you have something that loses money, does that hurt you more than the fun of the winners? I've had to. It's been an interesting internalization. And battery was much more, I would say, growthy in nature where it was like, you know, let's make sure every investment has a good shot at a 3X, 4X, 5X in that range. And Redpoint, what I've had to internalize is a lot more like swing for the fences. Hey, if we're not, if we don't have a shot at a 10 to 15, 20X, like what are we doing?

51:27and there's been a, I think if you go back and look, like my first couple of investments at Redpoint, you could see I was trying to internalize both elements of it. When I go back and look at like, you know, what I was thinking or reread the memo or all that, there was elements of both. And honestly, you need to pick one. Both can be great answers, but you kind of need to pick which side of the venture to be on. I saw something recently that 1 % of all exits drive, drive, I think, like 50 % to 55 % of value in venture. And so it's like - I'm surprised it's not even more than that. It's 1 % of exits.

52:02So that's not counting shutdowns in all the zeros. So it's probably like 0.1 % if you count all the things that you don't have any exits around, which makes sense. There's a power law. And it's even true at later stages. I think any fund that generates like over 3X, I think 64 % of their value comes from a single investment, something like that. I mean, it's not surprising at all. I mean, it's funny. When I think back on my personal investments, which again, I used to do a lot of now. Everything is through Wondercode now. But my two best personal investments where I put in 2009, a third of my at the time net worth, which wasn't much, in Facebook secondary at$8 billion, which is what allowed me to leave NEA to go to Dropbox.

52:48Do you have any connection to the team or was this like a - So Matt Kohler, who was one of the early execs, he was an analyst at McKinsey with me. Oh, funny. He was my best friend. Oh, wow. At McKinsey. For people I don't know, Kohler had a - Actually, what if you're a crazy one? Kohler's had an amazing run for people I don't know. He was LinkedIn. He was the first employee at LinkedIn. He was like Reid Hoffman's like EA turned chief of staff turned like first employee or something. I don't know if that was quite, if it wasn't exactly quite the path. I think the story I heard was, someone's going to correct me on this, but I think I heard the story was, Reed was like, yeah, I'm not really hiring, but I need people to help me schedule and put this thing together.

53:25And he was like, okay, I can do that too. So maybe it's an exaggeration of it. Maybe there's some truth. That's not how I remember it from back then. All these stories get mythologized in some way over time. Well, Matt's had one of the more extraordinary careers. So wait, but Facebook after that. And then SpaceX. So my buddy, John Herring, who runs VY Capital with Alexander Tomas, started investing in SpaceX. I mean, there must be a second largest investor in SpaceX or something. And he put together like a group of friends to invest in SpaceX at$10 billion. And, you know, at the time it was like, hey, they're going to come up with the Starlink thing.

54:03And we're like, what are you talking about, internet? Like, that's going to be the future of rockets. And then it's turned out that's incredible, obviously. And so, you know, you look at it and so when like some of our investors say, well, why are you guys doing some later stage stuff? We put a bunch of money in that last Figma round, which is, we think that's one of the great building companies in some Databricks. Ali's a really good friend of mine. And so we did a bunch of Databricks. And they're like, why are you doing that? And I said, well, look, we're just trying to figure out, can we get a 10 or 15x on something?

54:29And so if we think someone, even at a$10 billion valuation, is building something truly generational in a market which has its market, but also the adjacencies that they're going to get into can justify a hundred billion dollar company one day, which is what we hope for, for Dylan and Figma or half a trillion dollar company for Ali. Those are the kind of founders who can do it. And so we'll do that, which sounds, some folks wonder about that, but that's how we think about it. And so we're more modeled on like the way you described how Redpoint is, which is we want things to be really big. We don't get many shots on goal, like six a year, seven a year.

55:09And And so we want them to potentially be huge. We also have a lot of confidence in the portfolio because we know that the builds are very safe. Like those are things that we feel a high degree of confidence can deliver super solid returns for the whole portfolio, which means on the venture side, the juice in venture comes from us hopefully getting a couple of big ones. And what do you think about like Ali or Dylan in those situations? Obviously, the returns there. is that just a picking those things specifically from a focus and constraint standpoint is that when they show up and you think you have some connection to it and it just feels like this is a special founder and we believe in the opportunity or do you actively pursue those things of like chasing the people around and when can they take money I'll see you next time.

55:58I mean, we're so there's two different things here. One is that we we both of us, but also the whole group, you know, we've just been friends with a lot of these folks for a lot of these folks for a lot of these folks. folks were becoming either founders or the top execs at all the next generation great like literally every one of the next generation great companies you're like fighting with and we're like oh no we don't we don't invest in your kind of business you know like why would we invest in this you know and it's it's his greatest regret it's literally one of his closest friends is holly gozi at theta brick and he's had the chance to invest in him at 500 million was always too high billion at two billion which is always always true of the great ones right like and then And you mentioned the Dropbox crew earlier.

56:49I mean, you look at that crew, right? You look at the OpenAI management team. I mean, a lot of them, like a huge percent of them worked at Dropbox. You look at Figma's management team. You look at literally every one of these companies. There are one, two, three people out of the top five or six. I want to come back into the investing side of it, but I guess I'm curious because we're talking about Dropbox and that talent density. What do you think allowed that network to permeate? Because Dropbox was the company in, what, 12 to 16, 17, something like that? I think I'd probably 11 to 16. 11 to 16.

57:21Late 11 to 16. 10 billion, when was that round? I think I raised that in 2014. 14. And I did the 4 billion round in August, September of 2011. Okay. So that stretch of time, when those numbers meant something, now they don't... It's funny how fast it changes, right? Yeah, right now it's like three kids in a garage. Yeah, that reminds me when I made Star Trek and Pretty Woman. Totally. He makes fun of me because I sometimes will reminisce about these days. Yeah, yeah, yeah. So wait, so what do you think the talent density there? Was it just like a good sounding thing? There were a few things. One is that, so Drew started the company with Arash Ferdowsi.

57:59Arash was, and probably still to this day, is the most incisive, insightful person when it came to assessing talented people that we could collaborate well with. like he either so i don't know how exactly his brain right he's he was so talented at that um that was number one number two is um we all put a ton of effort into recruiting super talented people um and we didn't we didn't care about experience because none of us had any yeah it was that was that like a top-down directive was that an innate thing that you guys just felt some moral or like business-oriented impetus to go pursue i don't know we just like accountability We just liked working with really smart people.

58:40Yeah. And, you know, and it's, and people who, basically, if you were to say, what were the three qualifications? I mean, if you're simplifying it. So one is super talent, super smart. Number two was, would work well with the culture. And number three, were insanely hardworking. And I think I probably slept on the couch at least once or twice a week in that first couple of years. You know, it was a nutty, nutty period. And then, you know, it's Jeffrey was talking about partnership and all that. You know, it's funny. So Drew is still to this day one of my best friends. We were so close. I mean, like we officiated each other's weddings.

59:16Like he is one of the all-time great humans. He's a brilliant guy. And I think like we just collectively really enjoyed having people of that talent level around us. And then the final piece of the equation is that obviously you have a little bit of luck in these things or a lot of luck in these things. And so we were – things were just firing. Like a lot of the growth initiatives we would do would inflect the business over and over again. and when you have that and the business is growing so fast, recruiting someone super experienced from the outside to go, like a lot of times you'll just say, hey, talented person and ex, go do this job.

59:51So all of these insanely talented young kids got jobs that they were not qualified for at all, and the ones that did a great job, like at least my management philosophy at the time, was if someone's doing a great job, make it bigger and bigger, and if someone's drowning, I don't have time to mentor them and coach them and all this sort of stuff. You just got to move on. And so we were a little bit, I don't want to say, we were super nice people, but we were a little bit ruthless in the sense that if you were great, you would just get bigger and bigger and bigger jobs. And if you weren't, it just didn't, it was really going to work out.

1:00:23And so what happened was you ended up filtering for people who had two things. One is that the people who were crushing it ended up getting bigger and bigger jobs. And then they got hired to do really big jobs by the next generation of companies. And number two is, like, as you know, what's that whole thing? A players hire A players and whatever. So they were so relentless at only hiring great people to work for them. And so then the generation below them were also super talented in the same thing. So it's kind of like we created a talent culture and a way for this talent, not just to get brought into the company, but also to get jobs that allowed them to maximize their potential in that window, which then resulted in more talented of people wanting to join.

1:01:00And so we just ended up hiring lots of great people that way. Yeah. It's fascinating how all that stuff compounds and cascades on itself. I mean, it's crazy. And then of course, the final piece of why it all spread around is we got stuck at 10 billion. And so if Dropbox had been a half a trillion dollar company, everyone would stay. That's what happened to Google, right? Most of the people stayed. And so you didn't end up with that crazy Google diaspora. But why did PayPal have a diaspora? Well, they sold at 1.5 billion. Nobody was rich enough to just shut it down and move to St. parts. So at Dropbox, very few people got rich enough to never work again.

1:01:32But they were super talented. They had this amazing rocket ship experience and the company had a reputation for having good people. So a lot of other companies wanted to hire out of that talent pool. And so I think that's a big part of why it all kind of happened. So going back to the investment side, so the AI thing, how do you guys pursue the different ideas that you're going after within AI? Is it kind of opportunistic when this stuff comes in, or are you doing top-down of what you think might make sense? It's a combination of all of the above. It's a combination of all of it. I think the AI stuff is the hardest because the valuations are where they're at.

1:02:07To the point you made about data, it's like the best companies are always overvalued. I will say, I was reflecting in 2022 the beginning when the market totally pulled out, and I was looking at all these slides and graphs, and Publix were down you know, trading at six times forward or something like across the board. And there were private rounds going down at 150, 200 times ARR. And I was like, we all, all we say is internally, we want to be in special companies and we don't get too wrapped around the axle on valuation. That's what, that's what we'll say. But, but at that moment in time, I like wanted to add a caveat to the rule of like, except once every like five, 10, 20 years where this, this huge dispersion of valuations.

1:02:47And then at that point in time, we do care a little bit about it. And I was reflecting on we spent time with three investments at that point in time. And all of them were just exorbitantly priced, especially compared to the book markets. And I actually think in retrospect, we probably should have done them all. They've all sort of grown through and it didn't really matter. Now, have we been wrong on whether or not they were special, it would have materially mattered. But it would have mattered. But you can lose one X to the student of one. That's the thing that's so hard to explain. Like we get, you know, for some reason when people spend time with you, like with you talking about your business in our world, they spend a lot of time talking about why did that loser happen?

1:03:27Why did that loser happen? When instead what I would do is spend all my time trying to figure out for your outlier winners, was that dumb luck? Yeah. Or is that repeatable in some way? Was there some replicable thing? Is there something that you did with that situation or those situations that will allow you to do that again in your next fund or your next fund? Spending time with the losers, it's like, what is the point of that? Yeah. So within the AI thing, are there areas that you are particularly interested in? Does the media stuff come up and is that intriguing? It's getting intriguing. It wasn't early on because it was so clear that the rate of innovation is still so steep that whoever the winner is a year ago, not going to be the winner today or next year.

1:04:18in it, that they're going to get out innovated, you know, by the next generation of it. It's only in these last couple of months that now we're starting to see some creative tools that are image generation, audio generation, visual generation that are pretty compelling. And we've actually invested in one or two of them now that we're pretty, they're early. So, but it's still, if you talk about traditional media in terms of, you know, longer form, I think we're still, whether it's six months or a year or 18 months, 24 months too soon for that. The disruption is 100%. It's not even like a maybe here.

1:05:10It is a new set of tools and a new set of skill sets. Somebody had a great line, which is that it's not that AI is going to replace people. it's uh people who know how to apply ai are going to replace people who don't know how to apply ai that's really where this is going going to happen and so in the world of you know creativity that person who understands how to create the best prompt is going to be invaluable. Is that akin to some of the other technological transitions you've seen happen within movies and media at large, or is it different? It's unique, but it's not... There's analogies. Well, yeah.

1:06:11What about hand-drawn animation? Yes. I was going to say that there was 70 years of hand-drawn animation, and then John Lasseter comes along with this, you know, amazing short film that he made, you know, that the thing that was a Luxor, the lamp, and it was like, oh, my God, this is a new world. And that hit you like a lightning bolt when you saw that. Well, more like a ton of bricks. Yeah. And so this, and by the way, it was exactly that. At DreamWorks, you know, our first movie was a hand-drawn animated movie, one of the last, which was Prince of Egypt. And then came Anson Shrek and CG animation.

1:06:58And our entire workforce had to be transitioned. We had 1 ,500 employees and a third of them were in non-creative business and support and tech and all of that. and that the other thousand there, half of them were able to learn a new skill set, which is how do you animate with a computer versus animate with a pencil on paper? And some of them adapted incredibly well, and half of them were not able to. And so new sets. So it's very, very, very disruptive. I mean, you know, painfully so. So, but, you know, if we hadn't done it, we would have, you know, been out of business. Was there comparable resistance to that transition that you're seeing sort of today?

1:07:46Yeah. No question. Culturally, very, very, very difficult to navigate through it and to come through the other side of it. Lots of, you know, loss and insecurity and, you know, relationships and friendships. And, you know, these people were like family. And so for those artists who were not able to, you know, grasp onto the new thing that wanted to hold on to the old tradition, they got left behind. I hadn't really thought of this analogy. I mean, I think a lot of the like immediate job disruption transition, at least in the knowledge work era, as I think about it, a lot of those things maybe were kind of post mainframe, a little bit post PC, that a lot of the stuff that was done by hand started to move to the computer a little bit.

1:08:33So maybe there aren't as many recent lessons in B2B that I can think of just like pure near-term disruption that have happened. So I'm curious in managing that, communicating that, are there things that you would either do exactly the same as you did do or do totally different that you would maybe say to someone that is thinking through how to leverage these tools and how to deal with the human element of the transition? Yes, I would be 10x more aggressive about embracing change as opposed to fearing change. Change is inevitable. I mean, again, other people have said this. We went through an agricultural revolution, an industrial revolution.

1:09:19Now we're in the intelligence revolution. And if you do not understand, it is a revolution. It is going to, you know, 200 years ago, 98 % of the population was in agriculture. Today's 2%, you know. I mean, and it's no less important. Agriculture is still fundamental to human survival and existence in this. But people have moved on, and there are ways in which you can get redeployed here and this. And so, you know, I think embracing that change, understanding it, trying to stand in front of it, put your hand up and say, you know, I'm going to slow you down. I'm going to hold on to it. I wished I had gone faster.

1:10:02Not, you know, I mean, there was a point, honestly, where the company was in risk and we were in genuine jeopardy, holding on, white knuckled on the cliff, and then Shrek arrived. And it saved the company. And that is that moment, by the way, of, you know, making that full transformation. I made a half version of it, right? I was trying to hold on to, you know, the tradition because I love the connection between an artist and a pencil onto a piece of paper. There's just something so organic and authentic about that kind of creation. and it was an emotional thing in it. And I had been past the mantle of this amazing Walt Disney, right?

1:10:59And I was trying to carry that tradition on and to protect it and make sure that it prospered and all of that in it. And so trying to keep one foot in each world at the same time, it was tough. On the other hand, go back And I was instantly brought, you know, and embraced using computer animation to support hand animation. So I remind everybody the ballroom scene in Beauty and the Beast. There's all that computer work of that amazing dance sequence in it was not possible other than us embracing, you know, state-of-the-art technology there or the wildebeest, you know, stampede in Lion King. You know, those things were not possible two years, three years before in it.

1:11:48So, again, just, you know, that tug and pull. Yeah. The enabling technology always seems, at least psychologically, it's an easier. Right. But computer animation, CG animation, what John Lasseter did wasn't evolutionary. It was revolutionary in this. And that's how I sort of differentiate here. And I believe AI is revolutionary, not evolutionary. And so to embrace it and to know it and to understand it and to, you know, try and, you know, harness it to make you better, to make you smarter, to make you more effective and more productive and is, I think, you know, invaluable. No matter what job you have, no matter what you're doing, if you can find a way to, I mean, all of us, I don't know about you, but there's not a day in which now I am not on every one of these platforms and they are just making me just honestly smarter and more efficient.

1:12:48And it blows my mind how much more effective I am on ChatGBT and on Perplexity and on Grok and Gemini. I always believe that you can actually tell almost everything you know about a person if you look at the front page of their apps. right like that if you actually went into that and did an analysis of like we'll explain each one of these and understand why it's there versus all this other there like why is that what is on that front page and so here's on mine um perplexity grok gemini you got them all you know with whatsapp slack and google that's a little more extreme than i uh than i am i yeah I think I might have two on my home screen.

1:13:40I don't think I have five. And each one has something, by the way, just to give them all interesting in that. And Lama, by the way, also, every one of them has things about them that are unique and that are invaluable in this. And so I'm just trying to I'm trying to learn every day. Yeah. Every day is, you know, just like something something new is coming along here in this. And it's just wild, wild. So as you think about, like, are your incubations in this field yet, or are they mostly... We've done one. I mean, the problem that we have in AI from an incubation standpoint is we're not the smartest people in the world at it.

1:14:24Like, for us to do something that's a build, it means we have to think that we're the most qualified people to do it. Yeah. So we're in dog grooming. Yeah. Yeah. So we've got, you know, we've got... isn't going to touch that well consumer cyber security was our big run yes that was that was where i mean frankly we i i'm really proud of the stuff we've done there it's pretty cool well uh so aura a ura um so this guy harry ravich on there have you ever had harry on no i haven't but i know the business from the outside and and i i remember i was first exposed to it because they're the timbrel sponsor yeah i was like every time i see a random i'm watching a basketball game and i see a new sponsor i'm always like curious i'm like what is that and why does this company have so much money to waste i know i'm like like either i need to learn what this business is or i don't need to learn what this business is and i'll figure out either way i should figure out which one the latter but fortunately in this case i think before but so we're a couple hundred million of error now um you know harry is a uh i mean he's our other partner he's our partner yeah i wonder ago he is unbelievable he is one of the rare people who is super deep in business and also super technical you know those are like the most special entrepreneurs are the ones who can figure like learn both both sides of this thing and what we originally set out to do which was an idea he had and an idea we independently had and then um trevor olshig from general catalyst put us together because he's like you guys are both trying to do the same thing you should meet each other which was that this is 2018 and 19.

1:15:57At that time, every week you'd open a newspaper or go on whatever, walsherjournal.com or whatever it was, and it would be X corporation got hacked, 80 million social security numbers are breached, or grandmother took a spam call and gave away her bank account information, or this creep was found compiling social media profiles on the dark web or someone reuse their password. I'm going to go on and on and on and on, right? And it was like, okay, I guess the little trade we've all made is for all the joy of being on the internet, one day we're going to lose all of our financials, all of our money.

1:16:34And that's just kind of the price of being online is that we're going to get breached or hacked or what have you. And we kind of had this aha moment. We're like, that's insane. That's like an insane trade. Why has the world gotten to this place? and we say this jokingly because we have a lot of friends in private equity but we like to joke that a good target for us is when an industry has gotten private equity-ified because it basically means the companies tend to go into cash flow mode and one of the easiest ways to generate a lot of cash flow is to kill a long-term R &D if the R &D is going to pay out seven years from now why would a three to five year hold owner invest in a seven year pay out like EBIT.killer.

1:17:18They wouldn't, right? And even if they would, engineers don't really believe that. And so they all bail anyways. And so I think what happened is by and large, the entire series of companies that were set up to protect all of us online, starting at the antivirus companies and everything else, just stopped innovating. You cannot think of a new product out of the old AV companies in like two decades. And they were all desktop and they were mostly antiviral yeah yeah but i'm just saying but you can't think of any innovation right like it's it's nuts and so we said okay well that's the problem yeah you basically have incumbents that aren't innovating you've got like a threat a group of threats that are of course innovating and somebody should go do something about this their founders have murdered more people than right right right by the way i say that kind of half and so you know then of course the logical thing for us.

1:18:09It's like, okay, well, let's go meet all the startups doing this. And what we realize is the problem is the surface area is so big. You've got to protect people in all these different ways that unless you're, you know, there was a, there was a group of point solutions that were big enough that you could build independent companies, like one password, phenomenal business that we're investors in. And, and, you know, Nord VPN is an amazing job in desktop VPN, but there's a very small number of these, of these, of these kind of point solutions that could be big enough to become their own companies.

1:18:37Most of them were just sitting in like early adopter land. And so then we kind of have like an outsider's style idea, which is like, all right, well, what if we put all these together and built a suite? And what is all these together? You know, like everything from identity protection. Identity protection is password management or it's... Identity protection is actually like monitoring your identity online. My social security is on dark web. Social security, financial information, like all that sort of stuff. All the way through to, you know, VPN and AV and all this password management, all that sort of stuff.

1:19:05But then, and that was where the business got going. And that, you know, Jeffrey referenced that we had bought a public company. We actually bought a public company in the identity protection space. How big of a business was that? That was, I mean, I think valuation was like, it was trading like 50 million. It was like kind of a dying public company. We're doing identity protection. Are you really about that in revenue or? No. So here's the crazy thing about it. They were a, they would basically, it was kind of like a LifeLock style product that their go to market was the big banks would sell it to their customers.

1:19:35So Bank of America or Citigroup or whatever would sell this identity protection to their customers. I don't remember if it was white-labeled or not, but I think it might have been. And they grew really fast in like the 2000s doing that. And then the CFPB passed some regulation in 2011. I don't remember exactly what it was. That basically all the big banks said, you know, we're done with third-party products. There's too much risk. It's not worth it. We're done selling. So this public company, which it had, which kind of been a bit of a rocket ship, went into like this melting iceberg phase. Do you know what peak valuation was for him?

1:20:07I don't remember. Billion? My guess is probably$500 million to a billion. It wasn't like a giant. But it got to$400 million of revenue, I think, at the peak in 2011, 2012. Yep. And then when we saw it, it was at$140 million. And this is actually a case study of an associate doing a great job. So we were in this space. We were looking for more things to do in this space. one of our associates, this kid, Tom Cooley, who's now a partner at Sequoia. Tom, you know, came to me with this thingy. You know, he was like, look, we should be really thinking about buying this thing. It's like 140 million of revenue at that point in time.

1:20:40It's shrinking really fast. But the stock market hates shrinking public companies with very little EBITDA. And so it's trading at like a 50, I call it$50 million market. And I was like, Tom, how the hell it's in Chantilly, Virginia. What are we going to do with this rapidly melting iceberg. That sounds like a made-up place, by the way. For all intents and purposes. It could have been. And he was a dog with a bone. And he would listen to earnings calls. He would call the management team and get whatever he could. There was like one analyst covering his company. Not a lot of people dialing into that.

1:21:13That tells you a lot about Tom, right? So Tom was on me, on me, on me. Trevor introduces me to Hari. Hari comes by the office and we're just having this conversation. And I'm like, okay, this guy's a stud. And I said, Harry, if you want to use this as our starting point, we would do that with you. And he called me a month later. He's like, I've been digging into it. Let's go do this thing. And he didn't have a product at the time. Harry did not. I mean, he was tinkering. Tinkering, yeah. At the time, that kind of thing. I don't think he had anything. So then you guys buy it for$50 million. So we buy it.

1:21:43I think if you loaded it up with all the equity that we had to give it, I think it was$95 million or something, ultimately something in that range. and then how did the rest of the business come together and how did it actually turn around? Did they take the same product and just sell it to consumers? So we used the kernel of it and then everything kind of got just built on top of that. I mean, honestly, it turns out with the, look, there's a big benefit of buying something, which is you get to skip the zero to one phase. The bad news about it is that the reason it's being sold to you is because everything else is broken.

1:22:14Yeah. And in the beginning, we thought we'd like coach, coached whatever the team was into greatness that doesn't that doesn't work yeah it's a it's a complete yeah redo of everything it's you're building a company how many people were there you think 100 i don't do it well probably a couple hundred couple hundred and what do you think uh like how much turnover you think it's 50 percent left or 10 i don't think anybody's there oh really so like i think i might think it might be zero yeah but i mean they're all good people i mean that's just it just meant you sign up for something that's different we said something We were trying to create something totally – it was just a starting point for us.

1:22:47It wasn't like we were trying to be in the identity protection business. Totally. It just felt like a great way to really kickstart into this thing. And then, of course, we knew that the first thing to do is stabilize. It took us a couple of years to get the thing to stabilize. I forget exactly where it's stabilized, but it's definitely below$100 million. And then what we did – we did a bunch of crazy stuff with this, which is we took what became the growth part, which was tiny, like probably single-digit millions. and we took all the non-growth stuff and moved it into something which was much more like a Constellation software style company, which we called Pango.

1:23:17Different, different Holco? It's all, it was all together in a sense. Got it. But all the strategic, like super innovative, like all the R &D spent, everything like that went into Aura. Good stuff here. Yeah. Well, not, that was good too. Growth stuff. Growth stuff. Yeah, growth stuff. Like what's, what can potentially change the world went into Aura. And what was going to be like our version of a private equity business went into pango and then um about 18 months ago harry harry you know sort of through a personal experience of his landed on what i think will end up being the the biggest play which is um you know we're doing phenomenally well in protecting people online that's growing like really fast now and the unit economics are insane and like harry's a stud so it's all just working and roughly like i mean whatever you guys can share on scale 200 million 200 million or is Pango's much bigger, actually.

1:24:07Yeah. Pango's huge, actually. Pango's an awesome business, but it's... Anyways, whatever. So we can talk about that, too. So Aura's growing super quickly. So Aura's growing really fast. It's got... And about 18 months ago, Hari was thinking like V3 of the product, like what's gonna be the next thing? And he had an incident happen in his family where one of his family, one of his children, kind of went down a... Went and kind of took a left turn sort of thing. And he went through her phone and was like... And he's a very involved parent. He's a great dad. dad, you know, we vacation together. I see it.

1:24:37Um, and he was like, Oh my God, all the signals were here. I'm her dad. And all the signals were here. I run the fastest growing consumer, you know, online digital protection company in the world. And I had no clue. And V3 of the product basically became, how do I leverage the data on that's being, you know, through, you know, like the message you're sending, the people you're following Instagram, all the network traffic, all that stuff to give parents insight into what's happening on their young children's devices that can inform them about how they can parent better. And it's - Without becoming spyware.

1:25:17Yeah, it's not spyware. We're not giving you their messages and all that sort of stuff. But it's interpreting the signal. So I'll give you a really simple example. If you have a 12-year-old daughter and she's downloading calorie tracking apps and she's following fitness people on social media and so on and so forth, good chance you have an eating disorder coming your way. Right now, people don't have a clue. They get blindsided by this stuff. Or let's say your kid is on their device from 1 to 3 a.m. every night, and that was not the case a month ago. Odds are not only is their sleep getting disrupted, odds are something has changed in their life.

1:25:48Let's say they're communicating with a whole new set of friends, whether it's text or WhatsApp or Discord or whatever. Probably something has disrupted. If there's suicidal ideation and communication around that, which, by the way, in our beta set of customers, we have 2 ,500 users that we were beta testing before we announced the product a week ago. I mean, what was the percentage? I'm going to read it to you. 20 % or something. Some horrifying percentage of kids like 11 to 15 have suicidal ideation that they're communicating to people. And so this, you know, social media has done a lot of great things for the world.

1:26:21But there are really, there's a real dark side that we all know logically. The evidence is not, you know, scientific evidence is not, the data sets are not public. So here are the stats. That's 46. So 2 ,500 kids between 12 and 7 to 18 years old. So it's pretty significant. Okay. 46 % of them are depressed. 35 % have social withdrawal. 22 % are up late night on their device. So sleeping disorder. 30 % with low self-esteem. 22 % with self-harm slash suicidal thoughts. and 52 % with an eating issue. That's our own data. That's not some third-party data. That's the data that we have from our beta users.

1:27:06That's based on who they're following and what messages are being sent. Honestly, it's a lot of machine learning. There's a tremendous amount of data that funnels in. Right. And so rather than actually, as Sujay said, we're not actually, as a parent, it is giving you knowledge. Yeah. Information insight without actually going into the personalization. And and the only time it will surface to you an alert is when there's something that we know is actually harmful. Sure. And I assume there'll be dials or something. Oh, yeah, of course. So if you have a 10-year-old. We built it with Boston Children's Hospital.

1:27:46Got it. So all the child psychiatrists there. Got it. But also think of it as when you have a kid and they're now about to be able to get a driver's license, right? Was the first thing, they have a learner's permit and you have certain things that you need to do. And then they go from a learner's permit into a kid's permit, 16 years old in this. And that has certain restrictions around it. And you have to have a driver's test. And you earn, you're able to mentor your kid into being safe in a car. Well, this is the same thing. You need to mentor, but you can't mentor them if you don't know it. When you grew up, your parents knew three things, where you were, who you were with, and what you were doing, right?

1:28:30Today, you can have a 13-year-old sitting across the table from you, and you literally cannot answer those three questions. They may be at that table. It's not where they are on this device. They've gone to other places in a way that was never, ever, ever possible in this. And so parents say they're drowning, like literally they're out in the middle of the ocean and they're just trying to stay afloat and they have no tools. If 50 percent of parents in surveys will say that when their kid goes to sleep, they go and try to read everything that's happening on their device. Like that's the best tool that they have.

1:29:03And of course, kids are way too smart for that. So this has gone from actually being a really, really good business and something where Hari and Sujay were driven to build a great business that was going to be a fantastic... It's now turned into a mission. Yeah. Because we actually feel, as I said, we can be givers here, not takers in this, in which we can actually give parents the wherewithal to be great parents. And as I say, there's not a parent... Do you have kids? uh for maybe by the time we release this uh yeah yeah yeah yeah so but you'll just see when you get to that age there i was actually at breakfast this morning someone who's got 11 year old boy you know and she was actually struggling when i described this and i actually we could i showed her what this actually does it was like okay well how fast can i i mean i i like i'm desperate i need this and so does every other parent in my in my group and honestly this happens three times a day every day for every one of us in it.

1:30:01And so we actually just launched the product two weeks ago. It's got a whole bunch of features and functions that come out over the next, call it four to six months when it will be a sort of full. Are you guys, you're gating signups or people, can anyone go and sign up right now? We've made it so you're, it's slow to start. Yeah, got it. Because we want to just really nail it. Yeah, measure it. And as Jeffrey said, we've got a handful of things that we think are required before it's perfect yeah four to six well you're never perfect but you know what i mean four to six months from well and all these things are trade-offs we were talking about the privacy side of things but like like anything else in the world there's you know with with freedom comes other considerations in all of this you get a phone you get the ability to go start with a 10 or 11 year old which is the conversation i had this morning i said listen you're about to give or you've given your son a device that's cost you somewhere between 500 and a thousand dollars by the time we really said It'll be six, seven thousand.

1:30:56Well, next week. And the planes that had taken off or landed, they're OK. The, you know, fifty dollars a month for various subscriptions and things that are on this. And so at 11 years old, I'm OK with you having it. But just be understand that in return for that, I am going to have observational. And controls. And so in an 11 year old, you're not going to let them go on to sites and places. that you know they should not be on at their age. So there's very specific features and functions and controls that you can determine how long, what time of day. And so every parent, the beauty of the product is that each parent can make that choice with their kid about what level of control.

1:31:46And the controls on the 11-year-old versus a 17 or an 18-year-old will not look anything like that, right? And so. And also the way the parental controls model works here. I mean, there's a lot of different areas, like functional aspects here. But one of them is fine-grained parental controls where you can basically set timers for various apps. And then the kid has to come to you and say, hey, listen, I'm working on my school project. I really need YouTube for another hour. And you can decide whether to give it to them or not. But it allows you as a parent to actually finally have some constraints.

1:32:16I mean, you'll see this when your child turns like three. they can watch slime videos on YouTube forever. For eight hours. Yeah. Like it's the most bizarre thing. I have three little kids. I mean it's the most bizarre thing I've ever seen in my entire life. They love watching humans play with slime. So here's the thing which is go back to your thing which is this is only possible today because of machine learning and AI. It was not we couldn't have done this three years ago. You could do it with a sledgehammer but not in a fine grain way. Not in a way that would be agreeable to the kids. The parents would buy into it.

1:32:52And so this is where one of the amazing benefits that are going to come out of it. And we actually feel like we're on a mission right now that if we can deliver the promise of what this is, the impact of this will be just beyond anything certain I've ever done in my career. And I think that's saying something. What's the funding history of the company? So it came together with - You don't want to hear about dog grooming. I don't know. We can get to that. We might. This is a little more on topic. So the funding history here. So we put money in - 2018. This one was early 2019 as when we finally got the deal done, the first one.

1:33:40And then we did it. I forgot how much General Catalyst invested, but Trevor's been with us since the get-go. And then, I mean, there's been a bunch of it. It's been a journey. And so Excel's, the cap table's basically, I'll just say where it's at. It's hard to remember the exact history of it, but it's us, General Catalyst, Warbur Pincus, Excel. And then more recently, 1011 Ventures and Madrone came in. And, but then we have other ones, right? Like we, you know, we, you know, we own the largest mobile VPN in the world. 350 million downloads last year. We own 65 % of it. The CEO used to run engineering for me at another company and he's an absolute animal.

1:34:24And so no, what happened was there was a founder in Singapore that had created this product. Now we've just got to know the space so well that we basically approached and they hadn't done a bit as a person with a product. And we said, listen, are you interested in selling that product? And we built a company around it. And so he didn't invent the product, but it would, I mean, it was, you know, when we bought it, it was tiny. And now it's, I mean, I think it's probably 65 million of revenue and 30, 30 of EBITDA now. Um, and we bought it for 20 million bucks. No, these are all, I mean, these are all creative deals in some ways.

1:34:59Like, is that, um, as you sort of, what bucket does this go into? Are these in Cuba? These are builds because the company, they wouldn't, they wouldn't exist. And we're, and we know them cold. yeah like like we like you are an extent to the management team this is like there's there's not much that we're particularly good at but the things that we do builds in are things that we have confidence in ourselves that we're really good at i always have a line which is is that you know um i know something about everything and everything about very little yeah in the builds we stick to the things that we you stay within the line a fair way the ones that the few that we know we're confident when we do them yeah now i guess uh as we wrap um so are you still having fun doing this here's what i will say to you he's heard this which was sort of my and i really i assume he's heard all of this in some way shape or form but i but it's uh i found these words a few years maybe a year or two ago and they actually are every day which is never let your memories be better than your dreams i actually that was going to be my second question was asking about that quote here i uh i never i i actually didn't ask a single question in my sheet i have i have like 12 pages of uh notes or something so i don't i don't actually know who originally said i went and searched and i couldn't actually find attribution of it i thought maybe maybe i should just take it i was gonna say but i come from hollywood and that's a mistake yeah no you did not i did not but i've that i didn't create it but i own it yeah and that every day i really do feel it i just like it couldn't be more exciting i learned so much literally every day there are things that i never knew i didn't understand i'm i'm i have a great teacher here i got teachers and my partners it's super exciting i and it's hard for people he always does this if you well that's great but you know you know how about making top gun and i go no it was great but that's back and i don't want to make you know i did that yeah did hundreds of those literally and most of them were bombs by the way so not many of them were like that but so you know doing i find that the creating and the building of the companies today and the fact that this is all new uh for me is just incredibly energizing and and yes it's just wildly fun well you guys have a great partnership dynamic i uh i can see between how you guys work together and how you balance you know it's funny it just reminded me of this conversation i had in front of like so someone was asking like when jeffrey when we finally decided to get wonderco going i told you it was like a few months of like dating or whatever you call it like i was really struggling with the idea of this thing which was worth zero this this idea cutting it in half i was like i was like why would i give half my company which didn't exist away you know that was like kind of in my head and jeffrey looks at me and he's like what's your problem i'm 65 years old this is gonna be your fucking thing in 10 years anyways and literally i was telling this i was telling the story to a friend of mine the other day i was like and the reason i was telling this i was like literally my worst fear would be if jeffrey decided to not do this anymore because he is the magic You know, it's like it's like it's like it's like this thing that's just so funny about life.

1:38:22Right. Which is you meet people very rarely like him who have qualities that you literally don't see in anybody else. Like I ran into this. I don't want to name drop it. Like a very famous movie star yesterday who I know through Jeffrey. and he was asking how Jeffrey was doing and this and that. And I said, listen, like Jeffrey's a maniac. He's, if he's got 20 minutes of free time, he's going to spend that free time figuring out how to schedule something, schedule his next Tuesday because he doesn't want to waste 20 minutes of his day. Whereas for, and you know, we were, he and I were, the other guy and I were joking.

1:38:57We're like, well, we need to start the morning, get a cup of coffee. You know, it's just, Jeffrey is a very, he's like a once in my lifetime, at least kind of person to be around. And that's what makes life fun, right? To get to work with someone who you're just mesmerized by the habits and the practices and the kind of ideas and all that sort of stuff. It's cool. And it's different with each of the people we get to work with, but that's what makes a partnership fun. That's the point of it. Otherwise, you're spending all your time attributing who did what deal and how much credit do I deserve for that?

1:39:27And how are we splitting up the economics based on this or that? And what a horrible way to spend your time. you know it's so much more fun to just partner on figuring out what crazy stuff are we going to do together does it have a chance of changing the world when it doesn't work we all roll up our sleeves don't get me wrong you get tense at my moments because that's the nature of doing hard things but at the end of the day there's this foundation of trust and love and like a commitment to like trying to do something together that's really really fun it's a good place to end thank you guys for doing this a lot of fun thanks it's great to me thank you

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