The Investor Who Backed 10 Unicorns Explains the AI Bubble - Avichal Garg (Electric Capital)

If you extrapolate exponentially, you just sound like a crazy person saying it's going to be a trillion dollar company. Stuff is in this bull market right now and it makes me nervous because it's too easy to get over your skis. It's too easy to drink the Kool-Aid. It's too easy to believe your own hype. In four years, you can go from Anthropic not being able to raise a round to, oh my gosh, this is going to be a trillion dollar company. Anytime you see a platform where software is then eating that industry, the companies that win tend to be run by software engineers. So at Amazon, software engineers make all the decisions and they make all the money. Partnerships people don't. I think of my job much closer to like Rick Rubin and less close to Warren Buffett. If you look at Ivan from Notion, he's just got a really opinionated perspective about the way software should be.

I am. It's sort of as a side effect. A friend of mine years ago was telling me about how watches have appreciated and there are certain kinds of watches that have actually done really well relative to stocks. And I was like, oh, I wonder why. And I kind of went down that rabbit hole. It turns out it's very similar to a lot of other markets like gold or bitcoin or fine art where there are all these sort of underlying properties that drive the market. And once you sort of understand that they're all kind of the same, you know, it's like can you assess that it's real? Is it fixed supply or some limit? It's hard to make more of it. It's portable. It's easy to transfer. It's a global liquid market. It doesn't corrode. It's durable. Like all these sort of properties, you realize that all these sort of markets are driven by the same underlying principles. And so I was like, oh, that's very interesting.

And then the other sort of dimension to it which is a little different than investing in companies is you can have some form of self-expression. So what I like about this watch is it has what's called a GMT complication and that was created because humans could fly. And so we could get on a plane in Europe and go to the United States or vice versa. And so pilots had to start tracking two different time zones. And as a result, people sort of needed this. We had to create a tool to solve a problem. And so it sort of to me is like I like that aspect of it, the fact that humans had to create, you know, this is a tool and through technology sort of solve problems. And so a lot of the watches I like, it's not just the store of value piece but there's sort of something symbolic about it. Like one of my other favorite ones is when the astronauts were going to the moon, NASA commissioned a, hey, we need a watch that will work in space. And so Omega created this watch.

It was the Speedmaster. And it has a certain set of properties like the way the glass, you know, it's not sapphire because sapphire can shatter and it could get into the parts on the space shuttle or on the module. And so they picked a different material for that. And so you know, you look at that thing if you sort of understand the history of it and you're like, oh wow, this is not just a watch but it represents humans going to space and we needed to create a watch that could hold time and be super accurate and you could do things with it while the astronauts were going to the moon. So I think stories like that are super cool, well beyond the store of value piece of it that you don't get in a lot of other things. I think art is like that too, sort of like yes you can have the investment aspect of it but the art represents something so it lets you have a little bit of self-expression in the mix too.

Well, it's really interesting actually. I hadn't thought of this until you asked and this is not on the original set of things to talk about. It's really interesting because there's a parallel here to all the AI stuff that's happening. So what happened in the 70s in the watch market was these things used to be like tool watches and then they started becoming more and more luxury and so they're expensive. And there used to be these competitions where like how accurate is your watch and certain brands, you know, the Swiss watchmaking industry has been doing this for decades, centuries, and they used to win. And the Japanese invented the quartz movement and so the quartz movement came in and it was more accurate than the mechanical watches. And so it basically killed that industry. So basically they stopped doing the competitions because the quartz movement was better and more accurate and way cheaper.

And so from like the 70s to like the 90s that industry basically imploded because well who's going to pay all this money for what is a tool? And now you have a better electronic tool. So why would you pay a hundred times the money for something you can buy for 10 bucks? And so the industry actually recast itself and it became sort of like a luxury good. It became a symbol of what can humans produce that machines can't produce because it turns out a lot of these timepieces, like robots, you can't mass manufacture them. Like the degree of precision that you need, like you need a human hand, at least for now you need a human hand to make these things. And the fact that it takes, you know, 100 hours or whatever for a master craftsman who's trained for 25 years to do these things is sort of like proof of work in crypto where it's like there had to be a minimum. So what you're really wearing on your wrist is like proof that some human who is exceptional at their craft put 100 hours of their effort into the thing and that's why the thing has value.

And so what ended up happening, especially in the last I would say 15 years, is that the industry is bigger than it ever was. It actually rebounded and is now enormous. It's huge. And so I think there's actually like a funny interesting lesson in there on the AI stuff which is in the short term you think of these things utilitarian. And so a lot of the work that humans do that is very utilitarian, like these things will eat up and you'll say why am I going to pay a human to do it if the AI can do this faster and cheaper? But I think what you might get is like an echo boom is well what are the things the humans can uniquely do that the AI can't do? And those things that provably a human could do or only a human could do actually end up being more valuable. And so you might get this sort of secondary effect where things that a human had to put 100 hours into or a thousand hours into to create that thing are even more valuable on the other side of the commodification of the utility. So yeah, it's kind of an interesting parallel. So it actually, if you sort of understand that you might think about like from a career perspective, what are the things that uniquely humans can do actually are probably 10x more valuable on the other side of AI rather than everything just going to zero.

Yeah. I think there's one way to ask that question is like what are the moats on the other side of AI being smarter than us? I think for some time like atom physical world stuff will be a moat because AI is mostly digital. Maybe robots sort of overtake us in 10 years or something but there are constraints there. So I think anything around like physics and biology, so like fundamental energy or how these biological systems work where you can't at least today you can't simulate them, maybe in 10 years that changes, and so you just have to run the experiments. And so I think those things are real defensible things that probably become more valuable.

So for example if you look at health, you know, where do people spend money like once they have enough money, once they have enough surplus, a lot of people spend it towards their health because they're like well what's the one thing I can't buy or that I'm willing to spend a lot of money on is being healthier and living longer so I can be with my family or do the work that I want to do. And so those probably do really well. I think anything that has an artificial regulatory moat or constraint becomes a real thing. So anything that you have to get licensing or the government sort of controls the supply and demand of for some strategic reason probably is still very defensible.

And then sort of in speaking with this like what is fundamentally human, I think there are going to be lots of things that are still mediated through humans where it's a human on the other side making a decision. Those things actually probably become more valuable. So for example, I don't think the government anytime soon is going to outsource procurement decisions around defense or war to an AI. So what that means is there's some person at the DOD, the Department of War, formerly Department of Defense, and that person has to make a lot of decisions about who gets contracts or which weapons we purchase or which defense technologies or drones or whatever. And so that person probably came up through the military in some form. And so maybe they went to West Point or they went to the Naval Academy and they're 25 or 30 years into your career. So if you're somebody who has a 25 year relationship with that person, you went to the same school as them or if you worked with them and you were deployed to Iraq together or something, there's no substitute for that, right? And so strategically you're actually in a really good position.

And so if you look at like defense contractors for example, there's not investment advice obviously, but take like some small business that works with the government. Those things don't trade at huge multiples to revenue because they're very sort of people-heavy businesses. But you might argue that those things become kind of like the luxury watch industry, they become more valuable because the real asset that they have is these human relationships. And a lot of the work that they need to do that the humans had to do, now the AI can do. And so what you actually have is like a critical asset in the relationship. And actually AI is going to make your business way way more efficient. And so actually the margins in a bunch of these businesses go up. And so you might argue that there's this entire category of businesses that on the other side of AI is like way more valuable. And you can sort of poke through and I think identify a bunch of those in a bunch of industries. But those are three examples I think.

I agree. Well, you know, it's the other thing I was thinking sort of selfishly, which is why we're in the business that we're in, is I think in the early stages of starting a company from a founder perspective, so much of it is who you surround yourself with. And so that sort of like seed or series A decision where you're first taking money to start building the company even before you have product market fit, even before you know that it's going to work, that's a very human decision. And so I suspect actually our business in venture capital where we're working with founders so early actually becomes more valuable because those decisions are still, there's still a founder who's going to make those decisions. Like I think at some point we'll have AI started companies and they'll raise money on the internet through crowd sourcing or whatever. But before, even in that world, we'll have a lot of human founders and so I think our business will similarly be defensible for that reason because that human relationship piece I think is really important.

There are many guiding principles. That's definitely one of them. I think yeah, we're just so fortunate to be here in Silicon Valley. You know, we're just surrounded by amazing people and amazing opportunities and you can get capital and most of the world doesn't work that way. And so yeah, I think it's, you know, people talk about privilege and I think there sort of too often people conflate like money and privilege and I think money obviously is a form of privilege but I think an even greater privilege which money can buy you is these opportunities and this sort of access which you don't necessarily need money to have access to if you're in this place. And it's because if you have those opportunities then what you can really do, which I think is what's really the best part about our job, is taking the uniqueness of an individual human and turning it into a product and then getting that out to everybody. Because you know all the best products that people build are really sort of like an extension of who they are and their sort of values or beliefs or what they want to say into the world.

That's really kind of like one of the things I've come to believe over the last I would say like 5 to 10 years in particular is I used to and I think most people still do think of startups through the business lens, through a utilitarian I'm solving a problem kind of lens. And I think that's certainly an aspect of it. But the thing I've really come to appreciate is I think the right way to think about these entities is actually more as an artistic endeavor. And the person who's starting these things much more like a painter or a musician or more of an artist. And the reason is because the ones that are really really successful and have durability, the person is really trying to express a world view. They're trying to say something into the world and it resonates.

So I'll give you an example. Like if you look at Ivan from Notion, he's just got a really opinionated perspective about the way software should be and he spent his entire career building content creation tools. So he started at Apple, he worked at this Sequoia-backed startup called Inkling, and he was always just building content creation tools. It's because he comes from this mindset of if you give humans a bunch of tools, they'll create really great things. And he's very opinionated about the way that should be. But I think that's why Notion is successful. He's very opinionated about what it means to create good software that allows other people to create things. But I think that's why the company is so successful. And that's why I think it will continue to be successful is because he has sort of a philosophical perspective on what he's trying to do. I think all the great founders are like that.

And then what that does for us is it sort of recast my job as I think of my job much closer to like Rick Rubin and less close to like Warren Buffett. Because really what we're trying to do is we're trying to find these people who have something interesting to say in the world. It just happens to be that the medium that they're expressing themselves through is code. And that is an artistic endeavor in my opinion. And so, you know, I think that the sort of like if you understand all of these things, you start to understand kind of the back to this idea of the human relationship piece of it. Like actually, I think the people who understand founders as artists, like I think Marc Andreessen's done a great job with this. I mean, like people may not realize this, but I think you can see the impression that Mike and CIA had on Andreessen Horowitz. Like he sort of realized the same thing in Bill and Andreessen in that way. And I think that's why they're successful and they sort of at their core understand the founder as artist and they're like, you know, we'll take, just the way CIA takes care of everything else around the talent and sort of takes care of everything around you. And I think that's exactly the right model.

You know, all of these things to your original point, it all comes back to this sort of opportunity is a luxury, like the opportunity to have all these experiences and learn all these things is the real luxury that even money would not buy you these insights. It's like those opportunities are really what unlocked all these insights.

Yeah, I generally agree. Another way to put it is you have to do both, right? You have to listen to the market, you have to understand your users, you have to have empathy for those people and solving their problems. All of those things are true. But I think that doing a startup that's actually going to be a durable thing and interesting and new thing in the world, how do you cut through all that noise? Right? So there's just so many companies getting created. There's so many people in the world that could create companies. How do you cut through the noise? I think the way you cut through the noise is authenticity. And you have to say something into the world where people are like, oh yeah, that person's actually just being themselves.

So like right now, Hunter Biden is just going viral on Twitter, right? And it's just because he's being himself, right? And it's great. Yeah. It's amazing, right? He's phenomenal. He's so good at Twitter. And this is why Donald Trump is president, right? He just is who he is and he's authentic. And I think humans, we have this capacity to understand authenticity. And the reason we have that is if you go back to the primal human brain if you just sort of think about how society worked. So humans when we were in the small tribes, we had to be really really good at understanding what's real and what's not real from an information flow perspective. Is this person signaling something to me? Are they telling me something that I should be listening to? If I meet somebody from another tribe, can I trust them? There's all these subtle signals and so our brains are really good at understanding when somebody's lying to us. We can kind of feel it.

And that authenticity I think we kind of have a sixth sense for and it sort of hits a part of your primal brain where it lets you relax and say like okay this person is actually who they say they are. They're not a threat in some sense like I know what I'm getting. And if you think about a market, a market is just a collection of humans making decisions. And so actually markets are really good at sussing out authenticity. And so if you're really authentic and you say things into the world that you authentically believe, somehow the market can pick up on that. And a collection of humans will see it and say like, oh yeah, this person's actually telling me the truth. Maybe I should listen. And so you at least have a shot. Now your product has to be good. You have to solve a real problem. You have to make money. Like all those things have to be true. But you don't get a shot unless you're authentic.

And so that authenticity, then the question is, well, how do you become authentic? And I think that is actually the intrinsic exercise, right? That's like the Rick Rubin exercise is like, well, what are you trying to say? What is it that you can say that nobody else can say? Can you say a thing that when people hear it, they're like, oh yeah, that had to be that person. Right? And if you do that, if you get that right, then people might actually give you a shot. So there's all this extrinsic stuff like pick a big market, you know, what's your CAC, what's your LTV, there's all these things, those are extrinsic. But I think it's just as an intrinsic exercise, right? It's like it had to be Zuck that created Facebook. It had to be Larry and Sergey that created Google. It had to be Ivan that created Notion. It had to be Dylan that created Figma. Like once you start looking at these companies, you're like, oh yeah, this is just an extension of this person.

It's a founder market fit. Founder company fit. Founder product fit. Founder culture fit. You know, like Google's culture is so good at allowing people to have space to go solve hard problems and so they operate like a research lab in this because Larry and Sergey came out of these PhD programs. And so what that means is they're terrible at firing people. They just don't know how to do it. But it's because you don't fire people from a PhD program. Like maybe that thing that you're working on in the corner actually ends up being a giant breakthrough. So we'll leave you alone for three years. But that means that they are really not that strong at solving commodity technology network effect business problems like payments or social networks. They really struggle with those kinds of businesses.

Because you know the Google approach to solving let's say social networking or messaging was like hey let me build Circles. Let me build this better way to do social networking or with something like Google Meet or the 18 communication products they've had. It's like, hey, let me do real time facial detection in the browser to put a cap on your head in the... You're like, wow, that's amazing technology, but I just want to send an emoji. Right? And so you look at Google and they built the operating system Android, but they didn't get WhatsApp on top of it. They just missed that opportunity altogether. It's because it's a commodity technology, right? So that culture is an embodiment of the founder and their beliefs and then it leads the company to be successful in certain places. And so if you understand all that then you can sort of say like yeah there are going to be certain things that my company's really good at or that my startup is really good at that we should pursue and there are actually sets of things that we're not going to be good at that we shouldn't pursue. But all of that is actually intrinsic, right? You really have to understand yourself and what you're good at and what your company is and all these things. Which too often I think founders are so focused on the extrinsic that they don't spend time thinking about the intrinsic and like why are you the right person to solve this problem? Why are you the right person to pursue this opportunity?

Yeah, that's right. Yeah, I think there's a lot of truth to that.

It's an interesting question. I think the thing I realized, the through line in a lot of these things, I was really fortunate that the commencement address I had was that infamous Steve Jobs commencement address.

Was in the audience for that.

And he had this line about how you can always sort of connect the dots looking back. And so, when we were starting Electric, sort of the through line that I had that I realized was that the thing that I'm most drawn to is systems and tools and technologies that allow people to take the things that they're uniquely gifted at and actually succeed, and accelerate all of those things. And the sort of fundamental root philosophy of that is I think that we make progress at the species level, we make progress because you have relatively small numbers of outliers that find new ways to push things forward.

You can't really know who those people are at scale. It's just we're lucky that we have a lot and so that might be something like Einstein and some physics and science or it might be on the company level like an Elon, you know, at a country level like a Lee Kuan Yew, like these sort of individuals can emerge and really catalyze a lot of change in a good and positive way. And that's actually if you think about it a pretty philosophically opinionated view that we should identify those people and we should give them disproportionate resources. Because that's how you affect change and make things better for everybody.

For example, interestingly, arguably the entire country of Singapore may disagree with that premise. If you look at how their economy is set up, if you look at how their education systems are set up, the Nordic countries would disagree with that. But I think that's what actually things like capitalism or startups or gifted education or arts schools, that's actually what they do. What they do is they find those people and then they give them disproportionate resources. And to be clear, I don't just mean this in a utilitarian scientific sense like this is how societies make progress. Like you have to find people who make us think about what society should be or what culture should be or how we should treat each other. All these things fundamentally differently. And so that's why for example I think dedicated art schools are really important. But that's a pretty opinionated view to say like actually we should just be giving like 10 to 100x more resources to the outliers. And like I said I think entire countries would disagree with that.

So once I sort of realized that I realized that the through line in the education company that I'd done or the investing that I was doing or the philanthropic work that I was doing, it was all sort of that. It was like oh what it's all about for me is finding those people and then giving them disproportionate resources because you can affect, you have so much leverage if you can find, if you had like again setting aside the politics of it, if you had 100 Elons, you probably get to space way faster. And if you think humans should be spacefaring, then that's a good thing. And you could pick your favorite person, right? There should just be 100 more of them. 100x that number. And I think today we probably haven't identified more than maybe 10% of those people just by the raw numbers of it, right? So like there's 7 billion people. How many of those people even have access to the basics? But how many of those people just by the numbers, I mean the United States is like 400 million people. How many of those people live in parts of the world where they are potentially like genetic outliers? But we have no system to identify those people and get them those resources.

And so that to me seems like a civilization level thing that you should try to crack. Like if you could just find those people and then give them resources then everything else will sort of take care of itself. And I think historically the institutions in society that did that the best were the great universities of the world. So like Stanford or Harvard or Oxford. And the setup was we're going to create a system that has a great brand and so people will find us and we'll give those people access to ground truth. We'll get them connected to professors or graduate students or the cutting edge research or the best ways to think about these problems. We'll get them access to a network of peers who can accelerate everything that they do and alumni. Often there's some sort of scholarship involved. And so you know a little bit of money, fellowship of some sort so you can afford to come here. And we'll sprinkle in a little bit of like hey you deserve to be here like you're great. Like we're actually great at picking people who do amazing things and you deserve to be here.

And that magic formula is extremely extremely successful. And those universities have served I think a really good purpose in society setting aside kind of how they operate today. Because I think some of those places have lost sight of that core mission. What's also really interesting about that as a societal construct is it's really really defensible. It's a very durable thing. So for example Oxford is actually older than the Magna Carta. Just like crazy to think about that this thing has existed for a thousand years.

Right, like Harvard is, you know, 400 years old. It's like these are remarkably durable institutions. Arguably like right up there in terms of durable entities with like the church, right? Like religion is perhaps like the only thing more durable than these institutions that serve this purpose in society of finding the outliers and empowering them.

And so I think like even from a market perspective that's telling you something. That's telling you that fulfilling that purpose in society is something that is actually really important. And if you get it right, you can actually build something that actually lasts. And so when I think about our business, that's actually basically what we do, right? We have the same basic formula as Stanford or Harvard or MIT, which is we're trying to build a brand, so the best people in the world will find us. We give them access to ground truth because we happen to know a bunch of what's happening in certain domains. And a bunch of those things are counterintuitive. We give them access to peers that can accelerate everything they do because who you know matters as much as what you know. In the grand scheme of things we're seed and series A investors. We give people, you know, $250K, $2 million, you know, like $5 million, like in the grand scheme of things not that much money especially these days, like that won't even buy you a GPU rack, right.

And we sprinkle in this little like hey we've worked with great great founders. We've been fortunate to work at many of these places and invest in these companies at the earliest stages and you know like Mark Zuckerberg or Elon Musk today did not look that way when you're 22 or 25. Like we know what that looks like and you're in that same category, you're capable of that and sometimes that's what you need.

I think it's a little bit of an X factor. I wish I had a better articulation for it other than like when you meet somebody, you kind of know. You're just like, I think this person has that raw ability to do that. You need to be smart enough. Obviously, you need to sort of have clarity of thought, clarity of purpose. But there's something about the ability for these people to catalyze things around them and just get them done that you're like, wow, that's remarkable that you just managed to do that.

Yeah, a little bit of both. Which is why I think we ended up in this business. It's kind of funny actually. I mean I've certainly gotten better at it. And it's just more data points into the machine learning system in the brain, right? You just get better. But you know I think for whatever reason I happen to be pretty well wired at identifying those people. I have theories on why but you know like I think so I started angel investing in 201...

Yeah. Yeah. Well, I was investing in a couple of friends' companies that I invested in, but I would say seriously maybe like 2014ish and sort of actually pursuing it. And I have to go back and do the numbers, I haven't looked at in a long time, but I think of like the first 30 or so companies I invested in, something like 10 ended up being worth more than a billion dollars and like, you know, several of them ended up being worth more than 10 billion. And so I looked at that sort of return profile and had this sort of realization. I was like, wow, maybe I'm actually way better at finding entrepreneurs than I am actually at being an entrepreneur.

And so maybe I should just do that. And I had a bunch of people who were looking at this when I was doing this back in like 2016, 2017 who were like, hey, your track record here is really good. Like this is pretty remarkable. And so sort of a little light bulb went off. I was like, oh, I think I just have this little ability to spot these people and sense it. I don't know why. Like I, you know, but I can. And so maybe that should actually be my startup. Maybe that should actually be my company is like finding those people and figuring out how to get them the resources that they need. But I certainly got better at it. But yeah, I think I was just sort of blessed in some way to be able to spot those people.

I think it's probably about 2017, 2018.

Yeah, it was a little bit on the other side of that. I mean, some of those things started to work early and so it was like, oh, these things are working. And so Curtis, my co-founder at Electric, he and I, you know, I left Facebook at the end of 2016. He left 2017. And so we just hung out in 2017 as our business partner at Y Combinator and personally would hang out a bunch, just have long lunches and talks and conversations and it's sort of through that, that's like an intrinsic exercise right, it's a little bit of like co-founder therapy, you know, sort of like talk through stuff in life.

So Curtis was my co-founder at the company that we sold at Facebook and he was a very senior engineer at Facebook and had built a lot of infrastructure and tooling and some products there. But at that point in 2017, we were both free and so we were trying to think about what our next company would be and so we were sort of angel investing and poking around ideas and trying to figure out where the world was going to go, what we wanted to do. So a lot of it was we were just, we would literally have one, two, three hour lunches and just sit and talk and try to figure out what we wanted to do. So a lot of those insights sort of came out of conversation. It's kind of like therapy. Just talk and you sort of say something and you're like, oh, okay. That makes sense. Right. You sort of talk through.

I think I do. Yeah. It helps me structure my thoughts. The talking and writing I think really help me. There's like an intuition in here. This is my process. I know every different, like you can look at how there's some great videos you can find on YouTube about like how different hip-hop artists will find the lyrics and some people will like scribble. Eminem like writes.

And Jay-Z doesn't, like Rick Rubin talked about this. He just sort of thinks about it. Like Lil Wayne will just sort of it's in there and it comes out and he'll forget that he even said it, right? There's interviews of him getting like stuff he's written down and he's like, oh my god, this is amazing who said this. And it's like you dude. So everybody's different. At least for me, the process is like I have an intuition. There's something that's in there. I can kind of feel it and I can kind of believe it and then I talk it through with somebody or I write it down and that helps me crystallize the right way to express it. And so that's sort of what I think the process is as well. It's a combination of talking and writing.

That's a really interesting question. I don't think I'm that deliberate about it. But I think what's happened over time, you know, a lot of the people that we work with at Electric today are people that we've worked with for, you know, 10 plus years. In the case of Curtis, I mean, Curtis and I went to college together, some of them 20 plus years. He was in my freshman dorm. So, you know, I think it's sort of almost like survival of the fittest. It's like whoever's managed to be my friend for 20 years is a good person to just talk through stuff with. So, a lot of it is quite organic. There's a small number of people where if I just sort of talk through it with them it makes sense. I'm very fortunate to have some very very smart people who are themselves very thoughtful and accomplished and so they have really good perspective and they can push back in right ways which then helps sharpen the idea.

Well, it goes back to this. We were talking about this too is like what books are really impactful and I think he has such a phenomenal story and I think he's such a phenomenal storyteller and I think that's why the Bible is a book that everybody should read in the west and I think that's why the Gita is a book that everyone should read if you want to interface with India. Because I think humans, there's like the abstract things that we should believe and then there's the stories we tell ourselves and the stories are much easier to remember. So our brains are just wired that way probably because even before we had written writing, we had oral tradition, right? And so our brains are wired to absorb and remember stories and remember the lessons from them. That's why you got to tell a little kid stories.

And that's how they learn. And so, you know, I think people who have had unique life experiences and are able to convey those in a story that people will remember is that's a superpower. I think that's a really really important thing and I think it's again at the society level I think that's how we make progress like if we can tell those stories and remember those stories then we can actually transmit knowledge. I think it's also really important because if you understand the structure of these stories then I think you better understand how to communicate with people or you can understand the perspective that they're coming from. And so you can understand their frame of reference if you understand. Like in the west, I think if you have deeply internalized the stories of the Bible, you can have a conversation with somebody and understand why they believe what they believe and the structure and the framework of that. Or how to communicate with them in a way that they will understand. And so I think people who are uniquely gifted at telling stories, I think that's sort of a superpower that I aspire to have that I wish I had.

Yeah. Yeah. I mean, it's just a part of the job. It's, you know, I think not just as a startup founder, like you have to tell the story of how you get funded. Then you have to tell the story to your first few people that you bring on your team or why this is the place they should be. And then as the company gets bigger, you have to tell different stories and you have to tell the story of why you got started and you have to tell the story at different levels, right? You got to tell the story to the people who are just coming out of school and this is their first job and you have to tell the story to Wall Street. You have to tell the story to your board members and so you're sort of chief storyteller right, in addition to being CEO. So the executive part of it is like making the decisions but so much of the job is telling stories. And so I think for anybody who's successful, at a certain point it's like you can be smart, you can have the technical skills, you can have whatever insight, but more likely over time the cap is not those things, the cap is actually your ability to tell stories.

Yeah. Well, I think you're basically rate limited by the stories that you read. Like I think you can only be as good as the inputs, right? If you think of these as like machine learning systems and so the more good inputs that you can get then your brain can sort of transform those and some people's brains are better at transforming those things into unique output. And so there's some natural abilities there and then there's some abilities that you can hone. But I think it starts with like the more inputs that you can get the better.

Oh, you know, a lot of it for me is actually, it's just I spend so much of my time in this one world now that it's usually either stories of, it's personal stories more so than like sort of grandiose stories. And so a lot of it for me is in the one-on-one conversations that we have with founders.

It's like, well, why are you doing this thing? Like, where do you come from or why? And so those stories to me, I think, are actually the most interesting now. And kind of in an AI context, it's like the unique data is the interesting data. And so like anybody can go read a published book, not everybody can go talk to a successful but relatively unknown founder and understand their story and get them to tell that story. So to me, those like sort of unpublished, word of mouth, you sit at a dinner table with somebody and have a conversation, those are actually the real interesting stories.

That's the real, yeah.

It was different at different stages. You know, I think early in my career, a lot of it was just about learning and being surrounded by the right people. And so going to Google at that time was, it was such a special place to be, is probably what Anthropic and OpenAI, you know, a couple of these places are right now. It was just like the density of talent, it was just so remarkable at the time. So it's like the mid-2000s, and so you know, Google had not acquired, there was no Android, there was no, Google had not acquired YouTube yet. Like it was a crazy time to be there to go through all of that. And so a lot of it was just being around the smartest people and learning as much as I could. And then I think, you know, by the first startup, it was really to solve a problem that we cared about. We were building essentially machine learning plus education and trying to personalize content delivery in that domain. In the second startup, we sort of realized we made just a bunch of first-time founder mistakes. We picked a bad market. We didn't execute well. And so we wanted to do something where we were much more strategic about it.

Curtis was a co-founder, second startup. Yeah. And Curtis had had a previous startup too, which was also sort of like a small exit. And so we both sort of realized all the same sort of insights. And so for the second one, the way we thought about it was the realization was that if you really do want to have affect change and do good things in the world, the business has to work and the business has to scale. And so you need to have certain properties like being in the right market. And so we were very deliberate about kind of how we did it. And then we ended up in a situation where the product was kind of working. You know, at the time, this was early Android, 2011. You know, we had hundreds of thousands of downloads and probably, I have to go back and look, we're probably approaching a million, which was real at the time back in 2011. But the unit economics of the business didn't make sense for what we're doing and so we had to basically get acquired and that was the right rational thing to do. And again we sort of optimized for just being around the right people and Facebook, you know, in early 2012 before the IPO, the talent density just reminded us of Google in the early days. We're like, oh, this is going to be an important company in the world, which obviously it turned out to be. And so we were sort of motivated by that again. And so you know, after that I think things changed and they changed a little bit because we were so fortunate to be there at a time where the stock did really, really well and the acquisition set us up. And so we ended up being financially successful enough that we could then sort of enter this, well, what do I really want to do? phase in addition to being surrounded by smart people and now we can do anything. And so that forced a lot of that introspection. This is where, I mean, this is actually a perfect example we were talking about before with storytelling, right? It's like that arc that we had, I think, is an arc that a lot of people go through, which is like early on you're just trying to learn but a lot of what your sort of orientation is as a founder is scarcity mindset, which is you're hungry for every single opportunity. It's not just that opportunities are a luxury but it's like you're worried that any given opportunity makes or breaks you. And so you're sort of like frenetic, you're trying to like pursue every single opportunity that you can. And it's a luxury to end up in a situation where you don't have to do that, where you can be really deliberate about the opportunities that you pursue, but I think that has to come with some degree of success that you've already achieved. Because that allows you to be patient and that allows you to think about what you really want because even the opportunities that you pursue have a cost. There's an opportunity cost in your time and your attention and your focus. And so you can be much more deliberate about these things. And that's kind of I think what that acquisition gave us. It gave us the opportunity and the luxury to be deliberate about what we want to do next. So we take our time and really pick the right thing and be deliberate about how to go about achieving that. But you know, it was certainly downstream of having enough financial success, which is a relatively, in the grand scheme of things, a relatively low bar. Like you don't need to be a billionaire. But I think having enough in the bank that you're like, having safety, you're like, okay, I'm not going to starve. I can afford healthcare, you know, like there's some base level there that a lot of founders don't have. You're just sort of like always in that mode of like we're running out of money. We're going to, you know, this thing's going to burn to the ground. How do we succeed? But back to this like sort of story idea, I think it's like you can tell people that you can say like, hey, look, you want to be really deliberate about the things that you pick. You don't want to run after every opportunity. You don't want to just like fast-track your way to a million dollars because you might leave like a generational opportunity, like your life's work on the table, but that's easy to say, right? It's hard to like live through and for a founder. And so like I talk about this with our founders sometimes, but it's sort of like if you look at the life story of the Buddha and again I think these like religious stories like the Buddha or the Gita or my favorite parable in the Bible is Matthew 25. There's a parable of the sheep and the goat. And I think these stories are like really powerful. And so if you look at the life of the Buddha, he had to be a prince before he could go on the journey that he went on, right? Because the sort of like, hey, look, money doesn't matter.

Yeah. And it's like if it's a poor person telling you that, it doesn't have the same credibility in some sense as the person who has the thing. And so that's why even if you look at like a lot of the most famous self-help people, they sort of follow that pattern, right? They had to be successful first and then like every rich person tells you money doesn't matter, right? And so there's like this weird double-edged sword to it, right? But I think that's part of the journey. And so for like a lot of founders, it's actually back to this idea of the intrinsic motivation. I think for a lot of founders, there's a really deep tension of what they want to do and the reality that they're faced with in front of them. And actually, if they had $5 million in the bank, they might actually do a different thing. But they realize that like the path to getting $5 million in the bank is to do a certain set of things and so that's what we're going to do. And people can tell that back to this idea of authenticity, like you can kind of tell why are they doing that? Why are they doing it? And so as an investor, we really want to be working with the people that are like, I'm doing it for these sets of reasons and that's not to say that this set of people is misguided or anything. I actually think people should do that so that they can go over here. But you have to be honest with yourself about what the motivations were. And so I think probably for that first two startups, we were as motivated by like, hey, it would be really nice to exit a company and have some liquidity as we were about the thing that we're doing. And now we're just motivated by the thing that we're doing. And so it's just compounded in a different way. It's just like the world can somehow tell that we're not trying to do it because there's money involved. We're doing it because there's a set of things we want to say and do in the world. And somehow people can tell. And so those are also the types of people that we then try to work with.

Yeah. Well, I think you'd still do the pitches to VCs and you can raise money and you can sell a company for $100 million and walk away making a bunch of money. So I don't think there's anything wrong with that. You just have to be really smart about making sure that the fund math makes sense. And that the math for your business, the industry that you're in, how much money you're going to raise, all of that sort of lines up. So you can still be rational about it. And so, you know, I think the mistake would be taking a bunch of money from somebody that wants you to pursue a generational opportunity. You see that happen. There's this tension with a lot of founders. They're like, you know, the board's not going to let me sell the company. And it's because, well, what you did was you signed up for an opportunity where somebody's saying, no, no, no. Like, the only way this makes sense for the type of investing that I do is if this is a $10 billion company. And what you're presented with is the opportunity to sell your company for 500 million. So, we have a misalignment. So, as long as you're aligned with the style of investor and what their fund strategy is and so on and so on, that can totally make sense. And so, a small $25 million seed fund, if they give you $500,000 or a million dollars and you sell for $500 million, that might return the fund for that fund. And so, that's totally great. So, you just have to be really smart about who you take money from to make sure that's all. The second thing I'll note is I think the markets have changed a lot in the last 20 years, which is there are now opportunities for people to do secondary opportunities and go from this like scarcity mindset into this generational mindset. And I think that's actually really good and really healthy. There are a lot of investors that would disagree with me, but I think founders, you know, if your company's worth 200 million, 300 million, 400 million, I think getting like 2 million out changes the math. All of a sudden you're like, oh, okay, I can buy a condo in SF and like pay for healthcare and like my future kids will be okay, right, there and nobody's going to be like on the street. And it just removes a lot of that stress and now you sort of shift into this other mode. So the market has in some sense solved this problem by letting people do secondaries. And so I'm a huge fan of like founders actually relatively quickly in the journey doing secondary because what it's really doing is aligning incentives with the investors long term. Which is now if you've gotten some out, why would you sell the company right now, let's go make something big.

Far too many people to count is the short answer. You know, I think, and these things sort of build on each other and so it's just I feel very fortunate to have, I was born in this country so I feel very fortunate to have been able to come here, you know, go to great public schools. And we talked about this before, it's just like, you know, it's not uniformly available in all public schools but I was really fortunate for the places that I went to that there were teachers that sort of said, oh, you seem to be able to do certain things, like maybe we should get you tested and see if there's actually opportunities that you should be taking advantage of. And so, you know, everything from the teacher in elementary school that said, hey, let's figure out what you're good at and got me tested. And then turns out I was really good at math and some other things. And so she worked to get a special bus where I could go to the high school in the morning. There would be a bus waiting for me and then the bus would bring me back to the elementary school midday.

Yeah, but it's just, you know, like a random teacher that was like, hey, we should do something for this kid. To Curtis, who's been my friend since I was 18, and taught me so much just as a technologist. Obviously he's a phenomenal, phenomenal engineer but also as a human. To all the early lessons from Google and having access to Larry and Sergey and Eric and Marissa Meyer and you know, all the, you know, there's names that people know now but you know, back then Sundar and Brad and Nick Fox and all these people that I got to learn from were just people who worked at the company. And yeah, same thing with Facebook, is just the talent concentration is so ridiculous. And so all these great people to learn from. All the way to when we started our investing, just being able to have access to people like Elad Gil who, you could walk through Silicon Valley and there's hundreds of people that would tell you stories about how he's changed their trajectory. But he's taught us so, so much. You know, we wouldn't have gotten off the ground if it weren't for his help.

Oh, he helped us co-create this. I mean, he actually owns the domain. He'd been thinking about, back in like 2017, there were a bunch of people trying to figure out Bitcoin and Ethereum and what's going to happen on chain. And so Elad spotted this opportunity and he knew Curtis and I had sort of poked around with this stuff from the cryptography side and the distributed system side and privacy technology because those are all things we care about. And so he approached us and said, hey, have you guys thought about putting some structure around all the stuff that you're doing, the angel investing and the cryptography work and the privacy work, and you guys know how to build software and it seems like there's an opportunity here. And so he catalyzed it all. And then was instrumental in us actually raising that first fund that we did in 2018. Like literally he flew to New York with me to go pitch a piece on and like gave us feedback on the pitch and helped us iterate on the deck and like, instrumental. We wouldn't have gotten off the ground if it weren't for his help. But you know, he's done that for hundreds of people.

Yeah. That's what I mean, that's why people love him. And you know, all the way to I was very fortunate to be at YC and I never went through as a founder but I was fortunate to go through as a visiting partner in 2016-17, 17-18. And that was a phenomenal experience, right? Like getting to interact with Daniel Gross and Sam Altman and Michael Seibel and seeing Paul Graham and Jessica Livingston come back and how they interact with the founders. And you know, a lot of these things are, there's some explicit nature to the compounding where somebody like Elad comes in and takes you under their wing and just teaches you directly and is a great friend and a mentor. And then some of it is just back to this idea of opportunity as a luxury. It's just being able to be in the same room as some of these people and see how they work and how they operate and how they think. Sometimes that's enough, right? Sometimes all of a sudden that sort of makes that thing click in your head. I'll give you an example, like when I went to demo day, the thing I didn't think fully appreciate until I saw it was how Paul and Jessica at YC interact with the founders.

Well, they just have such a deep reverence for what it means to be a founder and like a genuine love for these people. And so, you know, it's like Jessica will stand off stage and like when you come off, she's just like beaming and she just makes you feel so good that you did it, right? Like it's such a stressful thing and she gives you a big hug. And yeah, it's, I don't know how to describe it other than just sort of like they have like a deep reverence and love for these people and it just comes across. It's like this intangible thing that you can kind of just feel.

Well, I think it's still partly them. But I think Garry has that too, like having been a founder. And I think most of the partners there are now like former YC founders, so they have like a deep empathy for that. And I think that was really smart on their part to sort of enforce that. We're the same way. I think about 40% of Electric is former founders. And it's by design. But that little bit of insight of like, oh, I get why this place took off the way they did. You needed the product market fit. You needed all that. But it's like it's just an embodiment of who they are. They're not thinking of this. Obviously, they want to make a ton of money and they're business people. They're venture capitalists, right? But

100%. It's just so authentic for them. They just like have a genuine love for these people and a genuine curiosity and it's like I have this really striking memory of, you know, YC does these weekly dinners with former founders that have been successful. So Brian Chesky or Brian Armstrong will come in or whoever and you know, Paul and Jessica are extremely successful. They're literal billionaires. They could be off on a beach somewhere. But they're like sitting in the middle of the room like listening to this talk from this person. Effectively, it's like a teacher-student kind of relationship is how it starts. But then these founders go off to be very, very successful and then they come back and Paul and Jessica will be sitting in the middle of the room like intently listening to the lessons from this founder and we'll ask a question and you're like wow, they're just like genuinely curious. It's just who they are. And so I kind of like seeing that, the light bulb went off is like, oh, I kind of see why this thing works. And I think it's just, so much of it just comes down, in so many of these products, I think in so many of these companies, it's just like they just care so much. It's that, I don't know who said it, but it's that story of like the furniture maker that sands the inside back of the drawer that no one technically cares about. Yeah. We can't see it, but like they can see it. And it's just like that little extra bit of care where you just care enough, but you care so much more than everybody else, but you have to care that much. When you see it, you're like, oh, I get it. Right? So, you know, that's a form of compounding where you sort of have this little light bulb go off when you see these people and you have access to them. And you can see how they operate even if they don't realize it. And then that just builds, right? And so every time that happens, it just sort of compounds and compounds. And then I think what's great about Silicon Valley is this place is a tight small group of people in the grand scheme of things. And so information flows very quickly about who's real, who's creating value. And one of the really interesting properties about technology, I think, is that the time from being a nobody to being somebody is very short. Like in four years, you can go from, you know, Anthropic not being able to raise a round to, you know, oh my gosh, this is going to be a trillion dollar company. And so what that means is practically speaking, any person you meet at a house party might be the next Dario. And that enforces good behavior in a certain way. But it also means that if you actually genuinely create value for people, odds are you've created value for people who will go off and do interesting things in the world. And so it has this way of coming back to you and compounding. And so it sort of enforces really good behavior. And so, you know, the compounding, I think it's sort of like inward in terms of like these people make you better but what's really great about the structure of how Silicon Valley works is like the way you really compound is you like sort of pay it forward and it has a way of kind of coming back to you because the community is so small and the networks are so tight.

Yeah, there are a couple. I mean, the reverence for founders thing I think is a really big one. I mean, our first value, everyone here will tell you, is founders come first because I think if you basically just do the right thing for the founders, everything else takes care of itself.

Yeah, totally. I think it's, you know, like we are strong advocates of founders retaining control of the company because I think in a long term, founders running things is better because they have moral authority and so they can make very hard decisions. You can go into a local maximum and you can break out of that because the founder says we're going to break out of it. I'm a huge fan of founders getting liquidity.

And uncomfortably early in a lot of cases and I think

Like Series B. You know, you have to have something but I think like unlocking the thing if it's working and the founder being a big unlock I think is important.

I think, yeah, it's a big change from like 15 years ago. Series A I think it can work if it's the right person and you have, it's case by case. The problem is you can create perverse incentives. So you have to be a little careful in how you do it. But you know, I think that's sort of that realization that like the whole thing works if you have a deep reverence for a founder, like that's your customer, that's the person that you need to optimize for. And these things are not one shot, right? It's, you know, anybody can go look up the history of like Parker and Zenefits and Rippling. And Rippling is the $20 billion company, not Zenefits. And YC understands that. And so they backed Parker unconditionally, right? And that was the right call. Including the sort of specific circumstances of that particular case, but intuitively they understand that backing the founder is the thing that you're doing. And so it may not even be the first company. It may be the second company, the second time around that it happens. And all these things, you know, it's sort of, hey, it's good to be good, you know, like that. That's sort of intuitive and makes sense. But I think people don't fully appreciate that the reason these things persist, the reason why he's successful is because there are real market forces at work here. So

Well, one is that the timeline from being a nobody to being somebody is very short. And so that's a thing. There's the power law nature of venture which is that one company if it's worth a hundred billion, that's the only thing that mattered, right? Like nothing else mattered. Because your return on that pays tenfold what you put in for everything else. And so if you think that somebody is capable of doing that then like you should just give them more money.

Double down, right. You know, if you think that the only things that matter are the things that can be worth more than 50 or 100 billion dollars. And in those cases it's that much more important that the founder retains control of the thing for the long term, then of course you would do certain things. You can actually from like the properties of how startups work you would back into oh these are actually the right principles which is why I think over time you've seen venture capital move in that direction like VCs 20 years ago were very different than early stage VCs have to be today but it's because the reality of the market sort of pushed in a certain direction.

Yeah. Well, first of all, it's unclear that they would hire me because I didn't go through IC, right? And so it's, you know, maybe it made sense, maybe it doesn't. I'm very fond of that place. My wife has been through three times.

No, we met through Stanford friends, but we have tremendous fondness for that whole ecosystem and Paul and Jessica have been very, very good to my wife. So, you know, we have a deep sort of fondness for that. But I think also at the end of the day, it's, I think I have the desire to create my own thing and create my own space. And so this probably wouldn't have been the right fit for me. Again setting aside whether or not they would have had me. But for me it's just, I think for me the act of creating something from scratch, there's something gratifying about that. And I think it makes me a better investor too because for the person on the other side of it, they know that the person that they're interacting with is themselves a founder. So a lot of the people we've invested in over the last five years, have seen us grow up as a startup. So, we're kind of, I would say we're kind of like a Series B company. Which is like we have a thing, it's working, we're trying to figure out how to scale it. That's kind of where we are in our evolution.

And so, you know, I think for a lot of founders, they can kind of tell that the people on the other side are also building something and that's very deliberate, but I think that actually makes us better investors.

Yeah, the observation was it was just startup thinking, right? It was okay, you know,

Yeah. So, how do startups generally have to start in order to be successful? What you have to do is you have to pick a beachhead. You have to pick a thing that the incumbents for some reason are not capable of doing, land there. And the bet that you're taking is that that market is going to be enormous, that people are underestimating how big that market's going to be and that the advantages that you accrue in that beachhead market will allow you to then go compete against the incumbents and you'll back into the incumbents' market. This is sort of the classic adage of, you know, startups are trying to figure out distribution while the incumbents are trying to figure out innovation and that's the race that you're in. And so our bet was this as a beachhead market would be a thing that the legacy firms other than basically Andreessen would not pursue. But it would be a huge market and so if we could land there we could build the business, we could build access, we could build tooling, then we would have a shot at backing into all frontier investments over time. But you know, just showing up and saying hey I'm yet another one of a thousand seed investors, it's a very, very crowded space. It's a difficult thing to break through. This was a beachhead that we could do that with. The other sort of belief that we had specifically about that market because we spent a lot of time thinking about privacy technologies or cryptography was that what had happened circa 2016 with Ethereum was a new platform had been created and that all of fintech and financial services would move to this new platform.

And so we said I think this is a new platform and anytime there's a new platform you see a new generation of companies come in and our belief was that these crypto technologies would, really what they were was software eating money, to use an interesting turn of phrase. And so if this was really programmable money, that was the thesis that we wrote in 2017, was we called it programmable money, that you had these stores of value that were emerging, these digital stores of value. On top of that, you get stablecoins and that was a way for money to flow around. But if you got stablecoins on these things, then you would have capital markets that came on here. And so, you know, stocks and bonds and private credit, all of these things would move on chain. But that venture capital would have to as well. And there's no reason that venture capital as a sort of from an operational perspective, it's just capital deployment. So, there's no reason that couldn't also move on chain. And anytime you see a platform where software is then eating that industry, there's this corollary that happens which is that the companies that win tend to be run by software engineers. And it's because all of your critical levers in running the business become software enabled, right? So let's take an example. Let's take something like Amazon versus Walmart. E-commerce, all of the critical levers in e-commerce have to be run by software, like how you acquire your customers, how you track the funnel, how you track where your packages are, like everything becomes digitized. And so what you have to do is empower the software engineers to make all these decisions. You have to create an A/B testing framework on your website. You have to create an automated advertising funnel to buy ads and track all these things. And what that does to the organization is that you have to set up an organization where the people who are making the critical decisions in your company have to be the ones that have all the power and make all the money. So, at Amazon, software engineers make all the decisions and they make all the money. The partnerships people don't. That's basically the inverse of what happens at Walmart. Like in a legacy retail business, the person who has a deep understanding of in-store shelf pricing and how the stores are laid out and how the relationship with Procter & Gamble, like these things are all the points of leverage, right? And so Walmart for years and years, it's a little different today but for years and years, always just had tier 2 engineers and they were just never going to be able to hire those people and so Amazon wins. Walmart 25 years later is still trying to figure it out. Now they're making a lot of headway, but it took them 25 years, right? The writing's been on the wall for a long time.

The reason they weren't able to do it is because what you really have to have, back to this idea of founders having moral authority, like Sam Walton would have made it. He would have blown up the organization and made it happen. But what you have to do if you're a professional CEO is you actually have to go into the organization and say, all right, all of you people over here, you're now fired. All of you people over here, you now make half the money. All of you people, you make twice the money. And by the way, you might not be the right people to do this. So, we might replace you, but now we're going to pay all the engineers twice as much so we can get good engineers. And if you look at like the org chart, right? Somebody like Sheryl Sandberg reports to Mark Zuckerberg at Facebook. In most companies, Sheryl would have been the CEO and Mark would have been like the chief product officer, right? So literally like the org chart,

And so is the CEO of Walmart going to go in and say like, no, I'm demoting myself, the COO, and like that person is now my boss. That's like a weird, right? So, like all of those human things end up being the hard part, not the software? Like Walmart can put up a website. They've had a website for a long time. They have actually amazing logistics network. So, like the software part of it is easy. The technology part of it is easy relative to the human part. And so, it's much easier. And you see the same thing with like Tesla. You see the same thing with, you know, the media companies. So it's like Facebook or YouTube versus the legacy media companies. And even if you look in media, you see, for example, the New York Times manages to pull that off and survive and is now thriving. It's because it's effectively founder-led, right? So the same family has run it, and so they can blow it up and reboot for the modern world, whereas like the Chicago Tribune or the LA Times or the Seattle Times or whatever, they're gone. That's not going to happen.

I think they'll be more empowered and I think the role of the founder becomes even more important. Because who you're working with and who you're working for and what you're working on start to matter even more when software becomes commoditized, like those things matter more. I'll give you an example. I think a lot of software businesses, not all, a lot of software businesses start to look a lot more like direct-to-consumer businesses. And so the branding and the marketing and what are you trying to say in the world, the culture of the place, all of these human things start to matter a lot more, which I think actually empowers the founder even more. Because that's what founders tend to be good at. And at scale, like you're not writing the code anyway. It's not like the founder's writing the code. What is the founder doing? They're dictating culture and they're dictating what the hiring processes are and what the brand is and how you say what you're trying to say and how you reach customers and coordinate all of this. And so I think it actually empowers certain kinds of people even more. Now, historically, if you look at anytime there's been breakthroughs or improvements in technology, there's a pattern that you tend to see, which is that people who can go one or two levels deeper in the stack tend to have all the advantages. And so what does that mean? Let's say you're a designer, like a product designer. A lot of the best designers have a very good understanding of how front-end engineering works. Like they have an intuition for JavaScript and CSS and they probably write those things or React. And the really, really good ones also often understand how the API layer between the front end and the back end interfaces. And so they can optimize the front end with those constraints or they understand why certain things are possible or they understand how to architect things such that the front end can do certain things. And you see that pattern over and over, right? Like the best back-end engineers understand how the APIs are set up and how the infrastructure is set up and how like data centers are built or like the data engineers understand how the chips are built and like, you know, all the way down how cooling works, right? And so like the ability to go deeper in the stack and understand how these things fit and what the constraints are that you're working under or when a new technology comes in how to adopt that, all of those things are what then give you leverage and insight and what to do with the tooling. So I actually think understanding computer science and software and being able to write good code doesn't mean that you're now writing the code, but it means it gives you a deeper understanding of what's happening below you in the stack. And then a different set of skills start to matter, right? So it's sort of, you know, like a designer is different than orchestration.

But it doesn't mean that the computer science mattered less. It just means that the point of leverage changed but actually the computer science is still a critical point of understanding and leverage.

Yeah.

Yeah, that was always the plan. That's why we named it Electric instead of

Well he had the domain. But that was sort of happening in parallel. We were brainstorming a bunch of names.