You British types are smart. Yeah. Anyway, some of them are.
Yeah, some of them are. That's true. Fair point. Even the dumb ones are smarter than we are.
Hi everyone. In a world of the internet, there are a lot of king-making background players. Sir Michael Moritz is one of them. Michael is a venture capitalist and early investor in companies like Google, YouTube, PayPal, and LinkedIn. I covered a lot of his investments at the time they were happening. His keen eye for opportunity made him a legend in Silicon Valley and a billionaire a few times over, but his background is unconventional. And his new book, Outlander, gets into it a bit deeper. For those who don't know, means outsider, and Michael in many ways considers himself this, and he is a bit of an outsider compared to a lot of people I covered. It's a really interesting book that he links to today's political atmosphere under the Trump administration. He is not shy from being critical of Trump. Something that most venture capitalists and people in Silicon Valley have not done and I really appreciate a really searing look at both history and current events. So, let's get into it. Michael, thank you for coming on. I really appreciate it.
It's very kind of you to have me. I'm flattered.
So, let me just say at the start, I texted you this last night and I was finishing up your book. You were a very good journalist when you were one as I was reminded and this is a beautifully written book. You have not lost any of your skills as a journalist.
That is too kind but thank you.
Not sure you want to be known as a journalist.
Oh, I'm very happy. I'll fly the flag as an inky wretch every day.
Yes. Yeah. Well, it's beautifully written and really you should keep it up. Anyway, for people who don't know, besides you being a reporter, you basically helped fund the construction of the modern internet. Let's talk about that just a minute so we can talk about where you're coming from here in your time at Sequoia. You invested and sat on the boards of huge companies, many, many huge companies. And you topped Forbes Midas 100 list of top tech investors twice. And as I noted before tech, you were a journalist. We've known each other a long time. Talk a little bit about that so people understand who you what your most of your career has been.
Sure. Well, I grew up in Britain, came here 50 years ago and began life in America as a journalist for Time magazine and did that for about four years and then along the way wrote a couple of books. One that I did with a Time colleague about the automobile industry and the next one was a book called The Little Kingdom which was a book about Apple's years as a private company and the first book about Apple. And then as a correspondent for Time I didn't know anything about Silicon Valley when I moved to California just literally didn't know it existed and I got very interested in it and I did a few stories about the venture business which again was something that I didn't know anything about. And the venture business back in the early to mid 80s was a world separated from the venture business that both of us know today. And I decided I wanted to see if I could get a job in the venture business. And I wrote to this is pre-email so these were actually typed letters that I sent to the leaders of well the five firms that stood out, Kleiner Perkins and Menlo Ventures and NEA and a couple of others. And the leaders were all really kind and you know they were kind, opened their doors and they gave me an interview and I think just to be polite they all brushed me off and said, 'We wouldn't know what to do with you. You were a history major. You were a journalist. You have no technology background or education whatsoever.'
And sorry, yeah. And one person thank goodness had a different point of view and his name was Don Valentine and he was the founder of Sequoia. And his opinion was as follows which was he was straightforward enough to suggest that he didn't know what made for a successful venture capitalist because he'd watched some of his buddies from who had held high positions in semiconductor companies or some of the computer companies and they come into the venture business and had flamed out. And then he pointed to several people that he knew who had not identical backgrounds but similar, backgrounds that on paper wouldn't suggest that they'd be successful in the venture business. One was a guy called Tommy Davis who started the Mayfield fund. And then but the big witness for the defense was Arthur Rock and Arthur Rock became the first investor and chairman of Intel and then a few years later became the first investor in Apple. And on paper he didn't look like a good prospect for the venture business but that was the reason that Don was more open than the others.
So was there something that you wanted to do? I know you had written the book The Little Kingdom which I read and remember very well beautifully written book again. Steve called you the historian of Apple in a lot of ways although I don't ever imagine you were in the tank for him. I didn't think that of a lot of books but I didn't think about that one. So you had some familiarity with technology.
Some but it was as it is today, very superficial.
Right. Right. Right. But what made you see something like a Google in that garage? You and I have both been to that Susan Wojcicki's the late Susan Wojcicki's garage. What did you see there at that time? because that's what really made your.
Well, it was actually pretty straightforward. We'd had a big Sequoia had a big advantage because we had provided the original financing in I think it was 1995 for Yahoo. And most people in Silicon Valley at that point, most of the investors shied away from the idea that you could provide a service for free. They didn't understand how the economics would work. And for me as a journalist, it was extremely straightforward. I remember having these conversations with a couple of the skeptics, commodities skeptics at Sequoia that it was no different on the internet than it was in television or radio where the consumer actually paid for their use of the service by enduring the advertisements that they were screened and the advertisements that they were shown. And so we invested in Yahoo and that's what played out at Yahoo. And then Jerry Yang called one day and said, you know, we're thinking about changing our search engine and we're thinking about using the technology from a couple of people that we knew a little bit at Stanford, Larry Page and Sergey. And I'd met Larry a few years earlier. and he said, 'But we're pretty apprehensive and nervous about it because it doesn't have any venture financing around it, and I don't think we're going to license this unless it has venture backing.' And that was the first time that I really heard about Google, Google as a company. And so he encouraged us to invest in Google. And for me, it was very easy. It wasn't complicated. the results were just better. The search results were just better. And so again it was a straightforward investment save for one thing which was the valuation. And there there was I won't name names but there was another character who participated through his partnership in the investment and he said when he heard about the valuation he said I've never paid so much for so little.
And that wasn't Don because he was your co-invest but I'll protect the name so I can guess. Why you're such a close chronicler of all the scallywags out here that you would know that.
What a nice term for them, scallywags.
I want to start talking I'll get back to Silicon Valley in a minute, but talking about the book because it does what's incredible is it has nothing to do with Silicon Valley or venture capital. It's a personal exploration of your family history in Nazi Germany. It tells the story of your family who escaped the Holocaust and those who were killed by the Nazis. It's one thing to investigate your family history for your own knowledge. which is another to turn your research into a book. Talk a little bit about this because you got a box of boxes after your mom died that caused you to do this. Talk about what made you pay attention to this besides personal.
It was all very accidental. I never set out to write this book and three things happened. My mother died slightly short of her 96th birthday. My sister who lives in Britain cleared out the house and put the documents and papers that she found. I mean this was not the Rothschild archives in maybe four or five cardboard boxes and shipped them to me. And these were some old letters. There were some documents, old identity cards, passports, and a few photo albums. And then COVID happened simultaneously. And we all remember COVID and for those of us who at that point, had the means, didn't have children at home, didn't have elderly parents to take care of, suddenly there was a lot more time on my hands anyway. I wasn't traveling, wasn't commuting, and I got engrossed in the story. Now, I obviously knew the arc of my familial history. What I didn't know were the details. And it's the details that make everything come to life. And so the papers that I received started me on this mystery trail where I was trying to find the clues, find the traces, piece the bits and assemble the bits and pieces and our family story is not unique. Obviously, there are millions of other people who know tens of millions of other people in various ways who got swept up in this horrific whirlwind that occurred in Europe. But obviously your own family story tends to become the most important. So that's how the book came about because of these boxes.
Right? Because of these boxes and you called said the entire you wrote a quote the entire heritage of what we knew about our shattered family was in them. What is there something that you pulled out I just recently got a box my dad died when I was very young and I my aunt recently died and I got a box of stuff of his and I pulled one thing out that was disturbing which was that he was in a play where he was in blackface which was astonishing. This was West Virginia in the 1950s, early 1950s, so it's not a surprise. But is there something you pulled out of it that made you say this is actually a book? Because you can just I've looked through them and I haven't thought, wow, I should write a book here.
Well, there were two or three things, let me tell you about them, that made it much more vivid and helped me assemble some of the pieces. So, I had the brother of my paternal grandfather there was a photograph of him that had survived in the files of the Gestapo. And the Gestapo were not supposed to take photographs of what they were doing to the Jews that they rounded up, but some smart alec had taken photographs to present to his commanding officer. And so there was a photograph of my grand uncle Oscar. It was the last photograph obviously taken of him stepping off a bus after he had been rounded up with the other people who lived in his little village. So that was one thing that brought everything to life for me. You can imagine. Can you just imagine? And even though the photo was in black and white, all of this stuff is about bringing color into the story. So that was one thing. Then a different scene was my father had been saved from the horrors because he was sent to school in England. And then in 1940 after the British government felt that they were in profound danger of being overrun by the Nazis after the Nazis had swept across Western Europe, they rounded up all the enemy aliens. And on the whole these were people of German or Italian descent who hadn't been granted citizenry and were labeled enemy aliens irrespective of whether they supported Mussolini or were Jewish or you know or familiar in this country Japanese it goes on and on.
You're exactly right. You're exactly right.
And so my father had been rounded up and then shipped off to an internment camp on an island called the Isle of Man on the west coast of Britain. And again I was sifting through archives and found as you do in archival searches one footnote leads you to another thing. And I found a trove of black and white photographs in the Tate archives in Britain. And I was, you know, really, you know, I was engrossed here. And because my father had talked about being interned, but I'd never heard any of the details. And there I found in two of the photographs pictures of my father behind a barbed wire fence in the internment camp. And then the other thing that really surprised me was after then I had two sets of grandparents. My paternal grandparents were murdered. My maternal grandparents got out of Germany 3 days before the outbreak of war.
Right. Right. Sally and Louise.
Yeah. And after the war there were copies of letters that my surviving grandfather sent to people that he knew in the farming village in which he had been born and grown up and had a small.
This is in Bavaria or Rhineland.
The Rhineland, northwestern Germany near the Dutch border.
And those letters moved me intensely because they were full of understanding, compassion, and forgiveness for what his friends had endured. These were non-Jewish friends and thanking them profusely for the help that they had provided to him before the war. Now, he was clear-eyed about this. He knew who the bad people were. And I grew up in an era in Britain in the 50s, 60s, and 70s where anything associated with Germany, any individual was considered an enemy. And so here to read my grandfather's letters within 2, 3 years after the end of World War II, it taught me a lot about the need for understanding of others and the predicament that they were in.
And they hadn't told you this. You say you knew nothing about your parents' early lives. And they didn't explore their past. And here you are doing this.
Well, I think for many people of that generation, the wounds were so deep and even though obviously both my mother had gotten out of Germany in 1939, my father in 1937, but they also didn't know whether they were going to get permanent residency in Britain or whether they were going to be shipped back to Germany. So there was an element of uncertainty about it. But it was a whole mixture of things that's probably very common. I'm no expert in the psychology of grief or despair but I think it was a desire to move on, to assimilate, and to not get enveloped too much by the past. But it was always for both of them it was always mentally just a half step away but they could never come to terms with it. They also you said they didn't view themselves as survivors of the Holocaust and they rejected the label and.
And do you think it also contributed their inability to grieve as you say?
Maybe for them survivor had a very specific connotation. A survivor was somebody and they recognized that they were very fortunate compared to the people that they called survivors but a survivor was somebody like a cousin of my father's who had the same name coincidentally as my dad who survived Auschwitz and eventually escaped. A survivor was there was a lady in South Wales where I grew up that my mother knew who had been born on a cart being dragged out of Auschwitz at the end of the war. Those were the survivors.
Those were survivors. But they were survivors because your mother's parents, Sally and Louise, escaped. They got out just before the war started. Your father's parents, Max and Minnie, did not, even though Max had chances. And there were some practical reasons Max didn't ask on those chances. But also, I want to read this passage you wrote. Max may well have clung to the hope that his military service and long membership of the judiciary would render him invulnerable or that more rational hands would wrest control from Hitler or that foreign powers would not tolerate a barbarous regime in the middle of Europe. Talk about the idea you're getting to here that Max's faith in institutions betrayed him.
Well, you put your finger on it. My grandfather who escaped as I just mentioned he was a small-time cattle trader which at the end of the 19th century was one of the few professions that was open for Jews in Germany and I think in retrospect I'm projecting some of this he was entrepreneurial he was street smart he had to rely on his wits he was never paid by the state he was almost blind at birth and so he didn't serve in World War I. My other grandfather, the one you referred to, he survived the trenches. So he had come out of that like all the other Jews who served in the German army and he got his Iron Cross and then he'd been the first person in his family to get a higher education and he became as you said a member of the judiciary and he had this misplaced faith in institutions and it's exactly as you just said here was this man who had served the state he was employed by the state he was going to he thought get a pension from the state and he had this false faith in I suppose the moral compass of the state.
In that regard two things you know You talk about your parents' trauma has been passed down through generations and so telling the story allows you to do that. How does that manifest with you then? Because there's a line that you write that I think is very important in this book. It says it's odd to feel like an outsider when everyone considers you an insider. I want you to sort of spool this out for people who don't know Outlander means outsider. My own experience with Outlander was in Germany itself when I was covering the neo-Nazi riots right after the wall fell. The neo-Nazis sort of went into East Germany and tried to recruit because a lot of this had been barred in West Germany and they were quite educated about the Holocaust in East Germany. They did no such education and so they found a very willing population who the Nazis were not blamed as much in East Germany. And so I was at a rally of neo-Nazis of all kinds following them. And there was one woman who stood in their way and said Schande which means shame. Except as they were walking through the streets of this East German formerly East German town in Eastern Germany. They were yelling Deutschland den Deutschen which means Germany for Germans, outsiders out. I never will forget that moment. It was really chilling. You talk about you named the book Outlander and you also say everyone does consider you an insider. I guess I do too as sort of an insider to Silicon Valley or the tech industry. Talk a little bit about this tension.
What one of the results of writing the book? Obviously, I discovered things about my parents that I hadn't really understood as a result of it. But I also discovered something about myself and why I am with all my various flaws who I am today. But I have never been able to get over the feeling of being an outsider no matter where I've lived. It doesn't matter whether it was in Wales or whether I was in college or when I got into the venture industry or it's always been there and the Britain that I grew up in the 1960s I think to some extent look I owe Britain a tremendous amount. I wouldn't be here without the actions of the British government. But Britain in the 60s was not a multicultural society and we lived in this area in South Wales where I don't know the population was probably about 2 and a half million and there were maybe 500 Jewish families in Wales and we were Jewish and German. And so you know the feeling as a child every child wants to be accepted by their pals and their contemporaries and we stood out and you sort of internalize that feeling and carry it with you. It's a very very permanent mark. So not belonging in Cardiff, not belonging in college in England and not belonging in the United States.
Meaning is what you're this idea of the outsider and I don't want this to come across as self-pity but your book is Outlander and think how many people today minorities who live in America feel like outsiders.
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Most of the book is about your family story, but you also reflect on the present political moment and you don't shy away from it. And you drew contemporary parallels to Nazis. And that's always fraught to do, trust me. Like I worry when people say he's like Hitler. I'm like not quite. But you write about how Trump's rise to power made you think a lot about the refrain you heard from your parents when you were a boy. If it did happen, it can happen. If it did happen, it will happen. If it did happen somewhere, it can happen here. Talk a little bit about this because while Trump's hold on American politics may not be what it once was, and I think we're on the descending mountain of that, the forces that ushered him in are still alive and kicking and always have been. So talk about these parallels you draw right at the top of this book.
I have been very careful never to call Trump a fascist, never to label him a Nazi, never to equate him with what happened in Nazi Germany. Never. But I do believe he has authoritarian instincts. the same authoritarian instincts that we've seen in others who've risen to the forefront of politics in their countries. And you know, one of the things that happens when you have an authoritarian with a lot of control, no matter how many protections everybody feels there might be in the United States, before you know it, you have the weakening and the hollowing out of the institutions of state with all of their flaws that people have come to rely on. And to me, it's like, you know, termites or dry rot. It's imperceptible to most people. Obviously, these heinous ICE agents shooting people in the face in Minneapolis, those aren't invisible.
And just this week again in Texas.
Those aren't invisible. And the cruelty meted out, those are very visible. But what is happening to various state departments that tilt to the judiciary all of that doesn't affect what happens in daily life until you confront it and then before you know it the state in which you placed great trust and emphasis is hollowed out.
Very much like your grandfather many were shocked how quickly some American institutions folded under pressures from the Trump administration at the start of the second term. You do I will say if I have to a criticism as you know I'll make this is you seem to give some of the tech guys a bit of a pass and they're quote responding to an invitation they could not refuse. That's a Godfather term. I feel like they could refuse some of those invitations given they're wealthy powerful. Talk a little bit about this because and the institutions themselves because this is something that your grandfather missed, right? He thought, 'Oh, well, I was a war hero. Oh, I was, you know, I'm in the judiciary. This can't happen here.' Which is, of course, what your parents said. And I think the leaders of the tech industry their companies are so large their influence so great their business all around the globe that in many ways the CEOs or the chairman of these companies are politicians and they have to be and maybe juggling pressure from China and juggling pressure from the US and dealing with the EU and other regulatory agencies around the world and I think they have a very difficult balancing act to I have some sympathy with them knowing that they are all cast from different cloth and maybe some lean more towards Trump than others but I think they all have his number and they're doing what they need to do in order to protect the interests as they see it of all of their shareholders and are trying very hard to ensure that they're dealing with a capricious vindictive character who wields a lot of power and the last thing they want is his various flamethrowers torching their company.
I get that. I completely get that. But this is something you kind of address in the book about what happened to Germany, right? If the richest men in the world can't say no, who can? And were you surprised at that panoply at the inauguration? When I saw it, I was like, 'Oh, good god.' Like, you're kidding me. You've got to be kidding.
I know for certain that a couple of them at least, and obviously I'm not going to name them. That's the very last place they wanted to be.
I am aware of that. I heard from them.
Yeah. And I'm sure all of them, or some of them anyway, wish that a great hole had opened up that just swallowed them up and made them invisible. I think some of them, again, you may not like this or feel I'm being too protective. I think some of them try to whisper in his ear privately and quietly without publicly humiliating him or taking a stand.
Maybe that's the most effective way to deal with this character. Throwing yourself on the pyre, I'm not sure does any good, but you're exactly right.
You're exactly right. You know, there are companies like Siemens and all these other, Mercedes, all these other vast companies, the Krupps, that were very, very powerful in Germany, colluded, but they also thought they could control him, but after the control phase passed, they colluded.
And they operated slave camps for him. They found it useful for their business that they could find cheap sources of labor in which to flourish. Now, I don't think we're anywhere close to that in the United States with the tech guys, but I know you would feel, and I can understand this, and I think a lot of people would feel better if some of them had stood up and said, 'I completely disagree with...'
Yeah. It's that you can see they want, they'll go to those dinners even if they disagree. And I get it. Listen, I had Elon Musk on the phone when he went to that first meeting in 2015 and he said, 'I can change his mind.' And I said, 'Listen, Jesus, I don't think it's happening. He's an old racist and like pay attention to this person.' And one of the things that I think is the most surprising is it never stops though. Like, especially when they want lack of AI regulation or they hand him some crypto money because he's so easily bribed essentially. Where does that end from your view? Because you have been out, you have in this book you do not back off at all. I'm not surprised. Ever since he started running...
And you know, in certain circles in Silicon Valley, I've been a loner. I have tried to persuade everybody that all our presidents, all our political leaders are flawed like all of us. Some have a lot more flaws than others. Trump is one of those characters. And what I've tried to do in the conversations that I had with various people, although I've given up on it because history is not going to, you know, we'll see what happens, was the number one thing that you want to look for in any leader is character, number one. And I think a lot of, well, I know a lot of people in Silicon Valley held their nose or turned the other way and ignored what they knew, and shame on them. You ignore character at your peril, I think.
I would agree. I would agree. Was there any worry for you? You spoke up really strongly. This book is very strong. I've not seen it except I'm trying to think of even Cuban who sort of tries to play it both ways many times has been critical but also is on the other hand kind of person. It's his nature actually. Is there a price for you to being this way?
I think you have to be true to who you are.
You end the book by revealing you decided to apply for German citizenship, which is fascinating. And we're seeing Germany is also struggling with the rise of national sentiment and anti-semitism. The far right Alternative for Germany or AfD is surging in elections. Talk about you applying for doing this German citizenship. And I know you think, and I do agree with you, they spent a lot of time trying to push back on this stuff. Are you worried about the national vow of 'never again' to lose resonance as the horrors of the war grow more distant there? That would be the danger. Obviously, it wasn't us.
