Please welcome primary General partner Jason Schuman. I'm a little shorter than the other people apparently. How's everybody doing? The speaker for this next fireside chat probably requires no introduction, but he's the only Barry's Boot Camp instructor from the PayPal Mafia, was early at LinkedIn, and is the former COO of Square. He co-founded OpenDoor and was the first institutional capital into businesses like DoorDash, Affirm, and Fair. I met him following a cold Twitter DM the week before he announced his return to Coastal Adventures. I'm excited to welcome to the stage Mr. Keith Rabois. Interviewing him is going to be my friend, senior editor at Forbes, Alex Conrad.
It's such a pleasure to be here with you, Keith, in your favorite tech ecosystem of New York, right?
It's four of my five—last four of five most recent investments are in New York.
So do you spend a lot of time here these days?
I've been here most of the summer, actually.
Okay. What about Miami? Is this a place that you still are as famously bullish about as your Twitter persona would suggest?
I live in Miami. I'm really excited. The fifth investment is in Miami. It's going to be a great company. It's going to reinvent education. It's not announced yet, but we're really excited about it. Delian had the stat recently that 11% of all seed investments in the United States are in Miami, which is great. That's up from basically zero when I moved there. So I think we'll get it to 20% and then we're off to the races. The stats you should be looking at if you care about the future of tech are what fraction of seed investments are happening where. Obviously series C, D, E, F, there are companies founded five, ten, fifteen years ago, so it's kind of irrelevant. I look carefully at seed and series A companies, and we've had great success both at Founders Fund and now at KV with Miami.
When you have been coming to New York to look at investments, sounds like you've made several recently. Are there certain ecosystems where you feel like New York is particularly strong right now and competitive with Miami or San Francisco?
Well, as you know, I'm really a founder-driven investor. I don't really have a hypothesis or thesis. I'm just looking for founders that resonate with me. But financial services innovation seems to have a concentration here. Two of the five investments are financial services investments.
Got it. So these days you're obviously a Midas List investor, a provocative voice on social media sometimes, also increasingly seemingly a political fundraiser, pundit, who knows. Does that—all these different hats you wear—is that where deals come in? Or where does the highest quality startup find Keith these days?
Well, one of the most difficult parts of venture is you never really know where you're going to find the coolest, most interesting thing. And it's really hard to deduce from ends of one or two. Your most successful investments per year, per five years, per decade—what do you learn from an end of one? Not that much. So, for example, we found the founders of Ramp through Delian playing video games. I'm not sure I should start spending all my time playing video games. That said, the common denominators: most good investments I've made come through someone on the cap table. I want to be the first institutional investor, but they might have an angel investor, they might have a co-founder that worked at one of the companies I've been involved with before, they sometimes have a seed fund that directly introduces me, which is great. I can lead the Series A, but I'd prefer to be ahead of the seed funds too. But fundamentally, it's usually through a person, not through some speaking event—though they do occur—not through some social media presence, although I do respond to DMs, as Jason talked about.
Do you like being contrarian and disagreeing with people in general?
Well, the problem is the world is broken. If you believe the world's great and the US is on the right track, raise your hand. The ether is just filled with stupid people and stupid ideas. I had this dumb idea myself, really dumb idea, like 10 plus years ago: I'm going to go correct the Internet. It's the biggest fool's errand ever because there's an infinite number of bad ideas and bad people out there. But it does occasionally have impact, which is encouraging. It's a little bit like golf. Golf is really, really difficult, but you hit one ball perfectly and you see the arc and you're like, 'Oh my God, I'll play golf another five years because it feels so good.' So occasionally you correct something on the Internet and it makes a difference in some real person's lives, and they come up to you and tell you about it. They say, 'I was going to do X, but then I read this and I realized that was a bad idea.' So it propels you forever, but it is difficult and painful. That said, if you have a platform—I have a reasonable number of followers, at least on Twitter—I would feel like, in the Jeff Bezos sense, I'd regret my life if I didn't post. If I had an audience and I didn't use it for good. I don't want to wake up 30 years from now and think that I could have shaped some opinion, some policy, something, and not leverage the ability to communicate.
Do you think it's sort of calculated marketing, for example, to be such a vocal supporter of the Miami scene, where you want to kind of corner that market?
That's less a political argument than an ecosystem. To create a tech ecosystem, you need a lot of different ingredients. It's like cooking a complicated dish. You need angel investors, you need founders, you need Series A investors, you need a bunch of different skills within a company—engineers, designers, business ops people, sales people. So it's really hard to start an ecosystem. You have to play a little bit like Noah's Ark and literally put a little bit of two and two and two and two and two on the boat and get everybody to Miami. So proselytizing is important, letting people know that there are these opportunities, that you don't have to sit and suffer in the Bay Area. You don't have to wake up every day and get assaulted or see fentanyl right in front of you or be abused. There are healthy, vibrant places to live, and you have choices. Communicating that does matter, but you ultimately need an ecosystem. I remember one of the things that started this Miami movement was in October 2018. I had dinner with a very successful CEO, and he asked me this question: 'How many people does it take to move somewhere else to create a whole new Silicon Valley? Is it 100, a thousand, or 10,000?' I said, 'I don't know.' But when I announced I was moving to Miami, he texted me—forgot about this dinner—and he said, 'Oh my God, you're actually moving.' And I was like, 'Yeah, I decided to run that experiment you mentioned at dinner. We're going to find out: is it 100, a thousand, or 10,000?'
I guess I'm just thinking, a lot of investors seem to want to keep neutral on a lot of topics to avoid alienating folks. And if you end up doing most of your deals in New York this year while also saying Miami is the best place to be a tech founder, does that create any tension in the narrative?
Well, my best New York investment has a major office in Miami. Kareem from Ramp lives in Miami. Zach Frankel, who's also the only other external board member, lives in Miami. We do three or four board meetings in Miami. So if Ramp is going to be—it'd be pretty hard to be a better company than Ramp, period, with no caveats. So if Miami and New York work well for Ramp, they should work pretty well for everybody here.
I feel like New York is going to claim Ramp and fight you on that one.
I don't mind. Whatever, wherever they want to do board meetings, I'm happy. But fundamentally, I think you're going to see more of this. Obviously Wall Street and finance has had this New York-Miami corridor for decades, and I think in tech this is new. So Ramp has an office in Miami, has an office here. OpenDoor, the company I run as CEO now, has an office in New York. We were founded in Miami, but the center of gravity for engineering particularly is going to be in New York.
I've obviously written a lot about your career over the years, including going back to Coastal events. And when I did that, I spoke to a lot of your founders. And you know, this won't be news to you, but a lot of your founders will say, 'Oh, Keith is so different in person than he is if you only know him from social media or the internet. He's such a nice guy in person.' Is that a conscious choice to be what some people might consider an asshole on the internet versus a person?
