He knows how to incite a mob and today he needs to be able to always have the attention focused on him. I had forgotten how exhausting and draining it was to have Trump as president because he cannot stand not being in the center of any news cycle. Put yourself in the position of say Tim Cook who runs Apple or Satella at Microsoft. They're in a terrible position. They're dealing with a mobster. They're dealing with a shakedown artist who, like Tony Soprano, is a bully and thug. If they cross this man, he will seek vengeance in one way or another. And he has all the tools of state and policies in which to damage their enterprises. Make sure you're not surrounded by people from Britain.
Right. So what does that mean? That means
We're delighted to say that this year the rest is money is being powered by Octopus Energy. And that means we get to welcome back the founder of Octopus Energy, Greg Jackson, now CEO of it. Time for a quick fire question. What's the one bit of advice you give a young entrepreneur? Maybe it's stuff that people don't normally talk about.
Don't be arrogant, but do be confident. Almost by definition as an entrepreneur, you're doing stuff that other people didn't think is going to work or that they've discounted or dismissed. So, you have to be confident to believe in your own ideas and your ability to deliver them. But you should still listen to everyone else and learn from them and not be arrogant. I think that is the secret to being able to build something special but successful.
Well, cheers, Greg, and thank you for powering this episode of the rest is money.
Hello and welcome to the rest is money with me Steph McGovern. Now today I am chatting to Sir Michael Moritz. He is a Cardiff born venture capitalist who started life as a journalist and then went on to become one of the most successful venture capitalists in the world. And to put some numbers on that, he's got a personal fortune of about 4.4 billion pounds according to the Sunday Times Rich List. He spent nearly 40 years running Sequoia Capital through which he was an early investor in companies like Google and PayPal, Yahoo, Airbnb, YouTube, and that's just a few of them. So there's loads to talk to him about in terms of investment, growth, AI, Trump, and geopolitics. But I started the interview by asking about his new book, Ausländer, which is all about his family's escape from Nazi Germany. Here's my interview with Sir Michael Moritz. Thank you so much for joining us because I know you're on a busy schedule at the minute promoting your book.
Oh, yeah. I'm glad to be here. Thanks. Thanks for having me.
And obviously you've spent decades building Silicon Valley's biggest businesses and I imagine lots of people would have expected you to be coming out with a business book. So tell me why did you decide to write a book which is kind of your deeply personal family history.
Well, I'd been asked to write a book about Sequoia or about Silicon Valley but I just didn't really have any interest in doing that and there are a lot of books about Silicon Valley and I'm not sure that I had anything particular to add to it. And actually this book was accidental. I never set out to write it. And to some extent, even now that it's out, I'm surprised that it's out because I didn't have any grand plan to write a book about my family.
Yeah. Well, it came about, didn't it? Because after your mom died, you found lots of documents and things.
First of all, my mom died at the age of 95 and just a few weeks before COVID. And my mother who was always predicting doom of some sort, she would have been really dismayed to have missed out on COVID because it was one of the disasters she'd been predicting for the previous 50 years. Anyway, so she died at a grand old age and then lockdown happened. My sister had cleared out the family house and she had found a bunch of papers and documents and old passports and visas and photograph albums and everything that every family has. And she shipped them off to me in California and they're in four cardboard boxes. And I had time on my hands because everybody remembers when lockdown occurred suddenly you weren't rushing hither and yon. There was no commuting and I wasn't traveling and so suddenly I had all these hours in the day and I began to rummage through these cartons. And I didn't think it was going to take me all that long to go through the cartons but then I kept coming across one document or one object after another and I began to get very curious. I knew obviously the outlines of my family history about Germany and the 30s and the 40s and the Nazis and World War II. I had no idea of the particular details. I had no sense of what it must have been like to go through that experience. And so I began delving and just sort of satisfying my curiosity more than anything else. And that step by step wound up with the book.
Yeah. I mean because that must have been really emotional as well doing that.
A fair degree of detachment. There was certainly some emotional vignettes and some emotional moments associated with it. But I found the whole mystery tour of trying to figure out, you know, I began like lots of people who are interested in their families. That began with ancestry.com and then it's astonishing how much information is digitized and stored in a digital archive somewhere.
Did it change your understanding of yourself then, do you think?
Very much so. I'm going to be 72 years old this year. So, some of it is just being at a different stage of my life and perhaps not being in a grand rush anymore. Some of it is regretting and reflecting on some of the things that I may have done as a teenager while I was growing up. But everybody has all that sort of stuff and things you're embarrassed or ashamed about. But it certainly made me understand how somehow in some aspects of my life like all of us I was echoing the behavior of one or other of my parents and had inherited for good and for bad what it was that they brought and I sort of began to mimic.
Yeah. Because you talk don't you in the book about inherited despair.
So what do you mean by that? Like how did that manifest in you? Do you think?
That particular generation? It's like all refugees. Doesn't matter where they came from. You know maybe these days they might come from Syria or Afghanistan or wherever or Sudan or wherever people are persecuted. The feelings of what it is like to be marked, to be unwanted, to be hunted, leaves a very deep imprint on people. And both my parents were fairly young, my father, and they were both about 14 when they got out of Germany. Much of our family was murdered on both sides of our family. So they were always worried. They were always concerned about a repetition of those sorts of events no matter the fact that we were living in Wales in the 50s and 60s. That sort of sense of impending doom hovered over everything. And my parents understandably were part of their connections in Cardiff even though they were very well assimilated but their closest connections were in the Jewish refugee community and they all shared this bond of having lived through these painful experiences.
There's a really interesting thing you see with lots of business leaders where often the most successful ones have had kind of some trauma in their childhood or some you know like maybe they've experienced a death of a parent and Robert who I do this podcast with Robert and I have talked in the past about whether that gives you some type of I don't know makes you take more risks in life whether it makes you have just a different way of viewing how you then take on your career in life. Would you say that's part of it then? This inherited despair has made you maybe has made you as successful as you've become.
I think being an outsider perhaps helps, but there are a lot of people who've been through terrible times either themselves or via their families who have then not led extraordinary lives like the leader say of some of these companies that everybody knows the names of. If you're on the outside and you have to forge your own destiny and nothing is handed to you, you then have to work very hard to make the best of yourself as opposed to living in a very comfortable setting where you know the greatest risk that you're ever going to make or the great sometimes I chuckle when I interview people and I ask them, 'So tell me what's the greatest risk you ever took?' Well, it was deciding whether to go to Harvard or Stanford. That doesn't qualify.
Yeah. Yeah. Yeah. And it's so interesting because you know, as you say, you're talking about outsiders and that's essentially the title of your book, isn't it? It's German for foreigner outsider. So that's how you felt then in your life.
Very much so. And you know, I grew up in Wales and I don't know when it first dawned on me that I was different from all the other kids I knew. But you know, my parents used to insist that we went to synagogue on a Saturday morning, which was pretty irritating when you're growing up and you want to go out and play football with your pals. But you know the thing that struck home most of all is in the days when people used to get telephone directories. Once a year a fresh telephone directory would arrive and I remember this. So we get the directory for the yellow pages. Well the yellow pages but then also the book had the personal ones telephone. So the book had arrived and I remember doing this for several years. I would flick through the directory to the M's and I'd look down hoping hoping hoping that there were other Moritzes in the telephone book, but we were the only Moritz in the telephone book. And of course, there were pages and pages of Evans's and Davis's and Hughes and Thomas' and Williams. But to me, the telephone directory said, 'You're very different from everybody else.'
Yeah. Gosh, that's fascinating that it came from you looking. So, how old were you when you were looking at the telephone book for the?
I was probably 12 or 13, I'd imagine. Yeah. You know, impressionable young teenage years, but it really struck home.
Yeah. And so, and do you think that's carried on for you then throughout your career?
You obviously you became a journalist and worked for Time magazine and then joined Sequoia Capital. And that was unusual for you to be taken on as Sequoia, wasn't it? Because wasn't it the guy running it at the time wanted to try and be a bit more diverse and you were diverse in that you were history.
No, he wasn't thinking about being diverse. I was very lucky to get hired because I didn't have the background that you'd expect for somebody going into the venture business because I was a journalist and I had a humanities background and no science background, no work experience in a technology. But no, it wasn't a question of diversity as much as he couldn't figure out what would make a successful venture capitalist because he felt that the people he thought would be successful venture capitalists, they hadn't succeeded. And the few that had been very successful had unlikely backgrounds. So that was the reason. It wasn't because I came from Britain or represented anything else. It was just he wasn't quite sure. So, he took a flyer.
Yes. I'm not complaining.
Yeah. And do you think then that that's because you looked at it differently from other people? Because, you know, I've heard you talk about how being it's a bit like being a journalist, being an investor in the sense of, you know, it's storytelling. It's decision making based on, you know, what you find out, the evidence you find out, and how you then present that and communicate it.
I didn't realize it at the time because I felt very much out of place in the venture business because I didn't have the conventional stripes on my arm that you'd expect for someone in the venture business. And I think most of the peers of Don Valentine who was the founder of Sequoia who hired me thought he had lost his marbles. But I had two big advantages which I only discovered in retrospect. The first was Oxford and the second was journalism and both taught me the same skills. And when I went to Oxford, I was brought up under the tutorial system and we were assigned a topic. I studied history about which we knew nothing at the beginning of every week. Assigned a bunch of books. Had to come back a week later with a 2500-3000 word essay where we had to pretend to a certain degree of mastery over the particular topic. Fast forward to journalism. You get assigned a story about a topic or a subject you know nothing about and you plunge into it and you've got to figure out who's pulling the wool over your eyes, who the charlatans are, who the honest brokers are. You've got to assimilate all the information very quickly. And then in the case of journalism, you have to write a story or host a podcast with a point of view. That's the same as investing. Very much the same as investing. You know, you meet an entrepreneur and you listen to his or her description of first of all, you don't know them. You listen to the description of the business that they're trying to start. You're trying to figure out as much as possible about whether the individual and the business make sense and you never have all the information that you want. If you have all the information that you want, it's too late.
And so then given the companies that through Sequoia you invested in, you know we're talking about all the biggest players your Googles, your YouTubes, your Airbnbs and everything else was there some in those moments of meeting those founders, those entrepreneurs I mean because you talk don't you about how it's a long process it's not overnight success and you know it takes a long long time so and that's a big commitment especially in a world where we're very much plugged into short termism. Whether that's politics or shareholder pressure or whatever it is. So how do you know who to commit to?
Right. I want the secrets to become a billionaire. Go on.
Particularly when somebody's 20 or 21 years old, 22 years old, you have no idea how they're going to develop as an individual. I didn't understand this at the beginning, but again, there's a bit of a pattern that runs through it. So the first thing I think that becomes a distinguishing mark is the ability of somebody who on the whole is fairly young. Not always but on the whole is fairly young who can educate you about something that you know very very little about. Or who sees something extremely differently and who also has mastered the subject. And so you can go back to the beginning say I'll give you one example of this of the personal computer business. Bill Gates got interested in personal computers when he was 12 or 13 years old. He knew more about personal computers than all the big marketing mucks running all the computer companies. And so I think first of all it's the humility that you need to show as say a 40-year-old or a 50-year-old to somebody who's 22 but who knows a lot more about one particular topic than you. Second thing that you need from that individual is a sense that they can communicate very clearly. Because so much of the challenge or so many of the challenges associated with a company are all associated with being able to describe what it is and how you see your company evolving over time. Because you've got to persuade somebody, some bright engineers to leave a job someplace. You've got to persuade perhaps more investors later on to invest in your company. You got to persuade customers to buy a service or product that they didn't know that you need. So being able to lucidly describe the benefits of this product that you've concocted, this service you've concocted is very important. And then the third thing is this sort of unquenchable hunger and drive and tenacity and resilience and persistence. And often these people aren't the easiest sorts of people to deal with or communicate with because they're very strong willed. But you need a strong willed person.
It's so interesting that because I guess getting all three of those things is quite rare because for example, you know, with communication, it's not something you essentially get a qualification in. It's, you know, I think often, particularly in the UK, the education system falls down on any kind of training around communication. It feels like it's classed as a soft skill, which does my head in as a phrase because I think it's the most important skill quite frankly. And so to get all of those three together feels like it's probably rarer.
It's very very difficult. Now it doesn't mean that they necessarily have to be evocative storytellers, right, in the way that would hold the attention of a podcast audience for 30 minutes. But I'll give you, you know, one example. So, and Larry Page, who is one of the founders, this enormously talented man, one of the founders of Google, and you know, I asked and it took me I didn't get it straight away. It took me some time to understand it. I said, you know, what is it that you see in the future of Google? And he said, 'I want to put the internet on my hard drive.' Today, obviously, Google has put the internet on a whole bunch of servers and data centers all over the world, but the internet is there on Larry's hard drive running hundreds maybe millions of computers all over the world. And just that was in 1998, 1999. And it's true today. And then you have other people, the most well-known example and the most mesmerizing storyteller, and this is a man who could hold an audience in the palm of his hand for 30 minutes. And Larry's a very, very shy, introverted fellow. Steve Jobs, mesmerizing storyteller. Absolutely mesmerizing. And he could persuade anyone to do anything. Steve was a bit of an outlier in many respects, but one of the ways in which he was an outlier was that he had the sensibility of a liberal arts graduate, although he never graduated from college, but he was interested in writing, in poetry, in culture. It's no accident that Apple many years later produced a documentary about Bob Dylan that Steve had come up with. And he had a poetic sensibility that most of the other founders in Silicon Valley that I've come across don't come close to possessing. Steve was without doubt the most mesmerizing storyteller that I've ever seen in Silicon Valley.
Well, Michael, this is absolutely enthralling. There's loads more to ask you, but let's sit tight for a quick break.
This episode is brought to you by Vanguard. Now, when it comes to your finances, you want to work with companies you trust, don't you? It can be really complicated when you're investing, you know, trying to work out where your money's going. And it can be confusing, can't it? And that's where Vanguard comes in because they always put investors first. And they're delivering on that promise for 50 million investors worldwide with a wide range of funds and a platform that keeps costs low and makes investing simple. You can also open an ISA or a self-invested personal pension. Choosing investments yourself or letting Vanguard choose them for you. Search Vanguard Investor to find out more. Now, when investing your capital is at risk, tax rules apply.
It feels like the common denominator is again linking back to the title of your book, it's the outsider. And I often wonder this because, you know, not to compare myself to you, incredibly successful entrepreneurs and things, but I come from a working-class background, joined as an engineer when I started out. I was one of very few women. So, I was the outsider from that perspective. Then when I joined the media, I was the only one with a regional accent in the BBC doing national news and that was a big thing and people were like how can she possibly be intelligent with that voice and all that jazz. But it became my superpower because then you get underestimated I think and that is like you're like come on then underestimate me and let's see what I do next. And I wonder if that's the sense I got from what you're talking about in terms of outsiders is I mean you can sink or swim can't you as an outsider but it's how you choose to.
