All-In with Chamath, Jason, Sacks & Friedberg

Industry veterans, degenerate gamblers & besties Chamath Palihapitiya, Jason Calacanis, David Sacks & David Friedberg cover all things economic, tech, political, social & poker.

E29: Coinbase goes public, direct listings vs. IPOs, portfolio management, unions & more with Bestie Guestie Brad Gerstner

E29: Coinbase goes public, direct listings vs. IPOs, portfolio management, unions & more with Bestie Guestie Brad Gerstner

Sat, 17 Apr 2021 02:12

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Statista - Death rates from coronavirus (COVID-19) in the United States


Show Notes:

0:00 Bestie intro & crowning a new SPAC king

3:01 Coinbase's direct listing, comparing vehicles to go public & lockup periods, Sacks on Coinbase vs. NYT

12:06 David Sacks on running for governor

15:21 Brad & the besties react to the crazy Q1 in the markets, a16z's savvy buying moves with Coinbase, issues with short-term behavioral lock-in

32:37 Top insights from Bezos' letter to shareholders, Amazon employees reject the union in Alabama

50:27 Reacting to Drew Holden's recent thread on media double standards in covering each party

54:28 Federalism's benefits throughout COVID, State-by-state results reveal lockdowns didn't work, vaccine incentives and PR due to J&J decision

1:04:20 Degradation of faith in institutions accelerated by COVID

1:09:26 Republican Senator Josh Hawley calls for big tech antitrust reform, bypassing institutions for progress

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Any word from the dictator? Or should we just do? I don't know, man. I got I I cannot spend my whole day sitting on zoom, waiting for tomorrow. Or I could have Brad Gerstner come on and sitting for isn't he richer than chamath? He is now the largest pack in the world. Should we do that? Should I just have bad come on the pod? Oh my God. Yeah. This backyard started. Now get him on started. Can I come in later? Like, what the ****? Like we replaced you with the new space King. Oh my God. Oh my God. Get him on. Is this like a kidnapping? And you guys are going to Take Me Out and drop me off behind a behind the railroad cars? What's going on here? OK, good. There we go. Game gain is great. Good game 3. Game 21. Let your winners ride. Man David. We open sources to the fans and they've just gone crazy. Queen. Hey everybody. Hey everybody. It's another episode of the All In Podcast we took last week off because it was spring break and we all needed a break. Hope you had a great one too. With us today of course the Queen of Kinoa from an undisclosed sunny location. David Friedberg. It looks like rain city. Is it Redwood City? Rain Man himself, David Sacks ready for governor And of course the king of all spacks, Brad Gerstner is with us again. The new dictator filling in for Chamath. Polytopia the dictator? Oh wait, Trump the dictator is here as well. And special bestie Jessie, Jason, Jason. It's not when you. I don't know what that means, but we're editing that out of the show. That's a bunch of beeps, but welcome Brad sitting in just for a moment here because Chamath was going to blow us off. Yeah, sure. We needed a specking. Sorry, guys. Packing, packing. Emergency. It's just it's just a little flattery for chamath. The truth of the matter is tamatha chamath is pioneering here and, you know, I think. It's been incredible to watch the competition and choice and it's Chamath knows I've participated in a couple of the deals that he's done and I think we all share the same feeling, which is you know there's been a a a system that is pretty Byzantine that wasn't serving the founders who we all you know care deeply about. And so I'm just, I'm thrilled whether it's direct list like Roblox did a few weeks ago that we we helped do and you know, or whether it's chamath and the. Incredible innovation that he's helping to do or you know we're we're lucky we've been we've invested in you know building a capital markets business on top of this this back and and and then you know worked with grab to bring a great public company out this week. So let's get to the direct listing. Good segue. Clearly the biggest news of the week is Coinbase, the largest direct listing ever. Bill Gurley, somewhere is smiling. And that's on top of Roblox, which I think was the second biggest 2020 revenue 1.2 billion. Sorry Brad did did Snowflake direct list or that was a traditional, traditional, traditional idea. I don't know who got their bet week their what their beaks on this one. Sacks, did you have a little bit? I had a little tasty poo. Little tasty poo I had. I had a lot showered upon me. Explain both because you're because you're in rivet, right? I am. I was Mickey's one of Mickey's largest hippies. Yeah, was Mickey for the audience. Who doesn't? Micky Malka, who runs Ribbit Capital, who owns 7% or 10% or 7 or 8% of Coinbase. And what was incredible was I got distributed all of it yesterday, which by the way, I think for a direct listing the strategy to me makes a lot of sense. I made a mistake in hindsight if I think about my distribution strategy because myself Excel Andreessen. When we did the slack direct listing, we distributed probably 510% and then we waited and then we trickled it out overtime. But by definition I think the price action on direct listings shows you that you top ticked the top price at and the moment on the open print. And so you know if you're going to sell you're probably better off selling absolutely right away. And if you look at the price action on direct listings, it's basically been one way direction down from the point of the direct listing. Spotify did that for two years. It kind of languished. You know, Slack did that until the Salesforce acquisition. So in general, I think if if a direct listing happens when you get distributed to stock, you should probably sell it right away and that means it was priced correctly as opposed to underpriced. Is that what we should take from that? Well, no, because there's no price. That's what, what, what's TBD is what is the morale hit to the company to see a one way direction down in you know, a stairway down on the stock price. So maybe it was good for selling shareholders, it's not necessarily good for the morale of employees, which then could impact the long term. Rise value. That's being built at a company, so I think there's a bunch of TBD's. I do think that direct listings are administratively clean in some ways. But company building may not necessarily win, but you you had a point of view, I think it was last year or two years ago about how you know and and I I read some papers that one of the analysts at Wall Street put out showing that there isn't much of a benefit to lockups with respect to short or long term price volatility. Do you still hold that point of view like I think lockups are I think lockups are really unfair because they they're their attacks on the people that have been there the longest, which are the employees. So you know the idea that somebody that. Comes in at the absolute last minute. You know, Brad and I have done a bunch of IPOs recently where like you get allocations in a book. He and I had nothing to do with companies, but we get its shares and we sell it day one. Then there are people that have been in that company for 678910 years who sit around, you know, twiddling their thumbs, watching all these other people generate one one day returns. There was a tweet that Bill Gurley had yesterday that says there's a well known crossover fund that over the last year has printed a billion dollars of of 1 day share gains. Well, that's crazy. So I think that lockups are kind of a regressive tax on the people that do the work, and they they are just rewarding people that have nothing to do with companies. Brad, what? What are you doing? Grab because do you lock yourself up, right, for a couple of years and is there a lock up for the existing shareholders and grab yeah. So first, I totally agree with chamath. Lockups are one of the most insidious things I think about the traditional IPO process. You know, the fact that DoorDash employees are sitting there watching the stock go from 100 to 200 and then, you know, all these other folks are selling. Although watched the stock go from 200 back to 100, I would think it's incredibly demoralizing and it doesn't. Here's the thing, it doesn't need to exist in Roblox. There was no lock up. The employees were free to sell, but guess what, a lot of them chose not to sell, right. It's fair and and and quicker price discovery when you actually allowed the supply and demand to exist in balance. So what we what we did at at grab was we fought hard for the most open unlocked right day one we could possibly get. In that case there are a lot of big shareholders who are on the board. So they're deemed affiliates under section 16 of securities laws. So they can't sell right, they're deemed to be insiders. Right. And but we at the end of the day all employees can sell. There is a group of senior management that said, hey, we want to voluntarily lock, that's a signal to the market, but all other employees in the company can sell. So they're over 5000 employees in the company. And all of the early shareholders consult on day one and I think this was the first time I've seen this in in you know this alternative IPO. So we have almost a third of the entire share base of the company that is available for sale on day one. Incredible. Hey Brad, can I ask one more question the the the economics for grab are they, are they better under your structure than they would have been for traditional IPO to get the same amount of capital and they're paying 7% to the underwriting banks? Now, as you remember, as we all know, you know, Bill Gurley has has laboriously pointed out and documented that there are two expenses to a traditional IPO, right? There's the upfront fee, five and a half, 6%, whatever they're paying on the amount of capital raised. But he would argue the much bigger expense, right, is the indirect cost of the structural underpricing, right? Right. So in a traditional IPO, let's say you have a $10 billion enterprise value, raising a billion dollars if it's being under price, he would argue. Structurally by 40% we can all debate that, but that's $400 million of dilution to employees and to existing shareholders. I I think everybody in the grab process both the buy side portfolio managers from Fidelity, Janus T Rowe, etcetera as well as the company believe that we got a 20 to 30% higher price than a bank would have got because of the conviction the portfolios managers had as a result of the significant investment. They're making in the company as a result of the fact that we were locking up our promote shares, our sponsor shares for three years. And so if you say it's 30% on a $4 billion raise, that's over a billion dollars of savings, right, over a billion dollars of indirect cost savings to the employees and the shareholders. And like for me, our North Star is founders. And so we literally have deconstructed the IPO at every step of the value chain and to say, you know like Rich Barton, my. My thought partner on this, he's taken, he's on the board of Netflix, when it went public, took Zillow Public, took Expedia public, and he said, like, we can make this better at every step of the value chain. And so we've thought about it like a product and we build in capital markets business. It says part of it right, is eliminating the Commission, part of it is getting a fair price, but part of it is curating that day one cap table. Right, because these companies are stepping into the public markets and you know, as rich as said and others have said, think about all the curation that goes into a private cap table now when you go public. Rich calls it a cap table randomization event. Right. You lose total control over your cap table, right. Whereas in the case of grab, we hand selected what we think are the world's best public market shareholders to be their day one cap table. So it's a very different outcome. And it's not just about cost savings, it's not just about trying to get a fairer price. It's actually making the process better at each step of the value chain. All right, so we were talking about Coinbase last year when they had a big brouhaha and Brian Armstrong said we are not going to talk about politics inside the company. You could have political views, but not inside the company. Sacks, you did some tweets about this. What are your thoughts? Yeah, I mean. Apparently. Coinbase is banned on politics in the workplace and their refusal to submit to New York Times interviews did not prevent them from creating an $85 billion company. You know, I'm, I'm shocked, shocked that they were able to to do that. That's basically what I tweeted and you know, it just shows that founders can do things their own way. They don't have to submit to, you know, the woke mob. And that's basically what I tweeted. And then you know, of course a well the 1st. It's been interesting to see the reactions the first day. I got like 10,000 likes and then the second day it seemed like some sort of SOS went out, and now I've been sort of surrounded. There's been this, like, outcry, and my take away is that the woke mob really doesn't like to be called out as a woke mob. And there's sort of, they're sort of surrounding me with pitchforks now, saying, how dare you call us a mob? Sacks, are you running for governor because it looks like you've taken. What do you think about Tux? Did you take Botox? He's in Miami, so it's probably he's going on with your laces on, lace Moss on the bottom. He's also your lips. Your lips are incredibly swollen. I mean, they look very subtle. Succulent. It's unbelievable, right? I've got a new lens. I've got five different technologies making me, slamming me here. But you do have your pin on today, and you do look very governor Orial. And I notice that you bought. I'm wearing my Miami pin. This is my city of Miami. Pin. Francis gave you that? Princess gave me the pin. Fantastic. Did he tell you never call me Francis? What is the big announcement today for you? We're really excited to hear it. Yeah. Tell us, Governor, what do you got on deck there? There's nothing that this is a, this is a Jason construction. I don't wanna get three. Do we have a, do we have an exploratory committee set up yet? Sacks out of the game. I need that deal. I mean, guys, guys, obviously if this comes to pass, we're going to rewrite history as David Sacks was our Manchurian candidate. You know, I floated the trial balloon. There was a layup for David Sacks to come in alley. Oop and Dunk on Gavin Newsom. No, look, no look, no look. The world. I tell you, Newsom is doing everything in his power to to, to blow this recall because, I mean, timing is working in his favor. I mean, he's done a horrible job and everything vaccine related, but the reality is COVID is winding down. It's going to be over. So even though he delayed everyone getting the vaccine by by weeks if not months, months probably, yeah, by months. We've got 7,000,000 unused doses sitting on the shelf in California because of all of his crazy eligibility requirements. Despite all of that, by the time we actually get around to the recall, which will be in about 5 or six months, the the recall election. You know, the economy is gonna be booming again. If we get covid's gonna be over, people will probably forget. But but for the fact that he is now saying that he cannot guarantee that schools will reopen in the fall. So we now have, we now have schools reopen in, you know, every public schools reopen basically in every other state. You now have private schools are all reopened in California. And he still cannot guarantee that schools will be reopened. Not not now, but in the fall. David, throw down the gauntlet. The guarantee you made enough money, you will open all the public schools when they open on day one. And this is the window, David, now or never. I'm not, I'm not. I'm not saying that that I'm running. But one thing I would say is that whoever does, what about if you rent, if you if I ran, I would 100% absolutely guarantee that school was opened in the fall. What we need, what we need is a governor who will go to the teachers unions and say, listen, you will either report for duty the first day of school. Five days a week, no exceptions or you go look for another career. That is what we need. Sucks, David. Suck. More. More. More. More. More, more. Yeah. Let's go, let's go, let's go. Can you make all the vending machines free? Yeah, sure. We can do that too. OK. Can you can you get rid of all my debt? Why not? OK, I'm in. Can we go back to the to the markets just for one second because I just want to, I want to ask a couple questions. Brad, Q1 was nuts. Let's get some color commentary from a big player in the capital markets. You talk us through us, talk to us through. What factor rotation was talk to us about your reactions to this archegos capital thing about inflation also gut check like what is the, what is the what is the rest of the year look like like talk just how what's your sentiment, how are you feeling? Just give us a reaction on just the economy and the gut check Brad on weren't you like the biggest shareholder in United at some point and. Off 2020, yeah. I want to hear about the bad way to start off 2020. However, I would say that it ended up being the best year in the history of the firm. And so, you know, like, we, like everybody else, had to reinvent a lot of things about our business last year. And and we learned a lot from that moment and and the courage that a lot of people at at United showed through through that period of time without a lot of help. A lot of people think the government was helpful. There's a lot of unhelpful things that were being done. But notwithstanding that fact, to to chamas point. I think I went on CNBC in November and just said, like when we normalize, there's no reason that the 10 years shouldn't be back at the level it was in January 20. Right. And for every 1% move in the 10 year you've got a 10 to a 20% drawdown in growth multiples. And the reason for that is very simple, they're long duration assets you discounted back at a higher rate and so you have multiple compression. And so we were starting at an all time high in terms of growth equity multiples for both software and Internet. When you look at October, November of last year, we've seen about 30 to 40% retracement or you know give back in terms of those multiples. Right. And some names it's bigger and some, some names it's less. I suspect that there's another 10 to 20% to go right for a 10 year that's going to be sitting here at 1/8 it. I just got done talking as part of this roadshow as you know to all the biggest growth equity portfolio managers on the on the public buy side, I can tell you they're all deleveraging growth. They are not adding, they're not looking to add dollars to growth and these are the biggest managers in the world. And so we're not through that process. There are some people who have anchored themselves to the fact that. Zoom was just at 500. They're like, Oh my God, it's going straight back to 500. You're like no, 500 was the outlier event. That was the all time high multiple event. It will get there in the fullness of time, but it's going to have to get there through earnings. So, So what do you think then happens in the privates and you know there's a lot of talk about certain firms, some of your competitors in the growth stage side ripping capital into companies every 24 hours or 48 hours. Where, where does that then normalize because aren't we setting up a dynamic where. If you have a bunch of growth firms pricing crazy rounds whose valuations can then will not be able to be held up in the public markets, aren't we creating a different kind of problem? Well, you know, you and I've watched this dynamic play out probably four or five times over the course of the last 15 years where there's this inversion private capital markets. Private markets are actually overvalued relative to public markets. I just look at a few IPO's this week over the last couple weeks. Deliveroo Hot private company down 30% in the IPO. Applovin came out this week 20% down in the IPO right at the end of the day. The great that you know is is Munger likes to say. You know the markets are voting machine and the public markets are a brutal. Voting machine and so you know it just is going to take remember when Groupon got done that last private round at 20 billion and then about nine months later trading at 5 billion or Zynga I mean you and go through the list we've watched this you know so it just takes the smack down and people losing actual money and and however so that's the one side right this is a temporary dynamic markets will clear I think it is possible you referenced you know a good friend. Of mine, you know, who's supposedly writing a term sheet every two days. You know at Tiger, the truth of the matter is you can you can hold simultaneous troops. You can believe the next three months that we're likely to have more multiple compression in the public markets, right. You could hedge your public book in a variety of ways against that like like we did and and announced last last December. And at the same time you can believe that the secular trend in technology has never been more potent. Right. And I believe that if you own an index of the top 30% of technology companies in the world today and you're willing to hold them for five to 10 years, you will be incredibly well rewarded. The the most asymmetric bet maybe in the history of all of investing is having a golden ticket to have access to the best technology companies in the world today. It's it's it's like unfair play, and everybody on this call is playing in what is a highly asymmetric and unfair game stacked in our favor. Now we can screw that up by trying to think we're good at short term trading or doing a bunch of other stuff. We can get individual things wrong. But if you bet on the top, the top quartile of technology companies on a global basis like Tiger and others are doing, and you and you have time on your side, you're going to be well rewarded. We we talked about. The mid market, late stage venture space being a no man's land of vortex, the value being created in the late stage and value being created in the early stage, but the money in the middle becoming a commodity because of tiger, CO2 and others coming in and just coming over the top. Do you subscribe to that, Brad? Do you think that's just a financial transaction in the middle and not a lot of value to be made there or do you think you know, listen, it doesn't matter in snowflake whether you invested in the $100 million round, the $200 million round, the 500? Billion dollar round, the billion dollar round where Sequoia came in, you know if the company is going to two, three, $400 billion, right. All of those are extraordinary returns. So altimeters described itself often as a life cycle investor, right? I represent the biggest portion of the capital and the firm. Some long term endowments are #2 and #3 and we have a multi decade view on the world and our view is the one that I just articulated. I want to have maximum dollars. I don't care that it's all in the B or the C or the D or the. IPO or you know, I want to have maximum dollars behind our best ideas and I want to be an incredible partner to these companies as they move through the life cycle. And part of the reason we build a capital markets business to help founders in a better way step into the public markets is it's part of our mission, right. Like I want to, you know how frustrating it was to me, Jason to be primary or pre IPO and Mongo or Twilio or Octa and then when it came to the IPO, I have to go to the banks and grovel, right? And grovel for an allocation and they dribble 5 or 10 million and I see them handing big check, you know, big allocations to people who I know we're going to flip it and I actually want to own this stuff. It's very frustrating. And so we think there's a better way. And when those companies come public in the future, you said something which I want to use as a question to Friedberg and Sachs and Jason because these guys are involved, very sense in one way and what I'm going to say, which is you said gross tonnage of dollars, one of the most incredible things that I thought. About the Coinbase. The S1 was the amount of unbelievably smart buying that Endreson did, and I thought to myself, andreesen just out Sequoia. Sequoia. And what do you guys think about sort of how they've been able to to actually execute? It just seems like Andreessen has done an incredible, incredible job. I don't want to. I mean, Jason, you're close to Sequoia, so are you, Friedberg? I just want you to react to that. Now you gotta get you gotta give him credit on Coinbase because I think they made the they made the most money. I guess Ribet and Gary Tan and initialized may have made the highest ROI because they invested a smaller amount of dollars earlier. My return and rip it was the Maya from iconic told me was 506 times right? Exactly so so so Rivet made the 500X that I guess. Andreesen, but Andressa made like 20 billion of returns, of which you know they're probably getting 2530%. So they they made the most money. I may not have been the highest IRR, but it was the most money. And you're right, they doubled down in this like 2018-2019. It sounded like they were doing a bunch of secondary buying the stock at 25 bucks. They bought it all for Fred Wilson and Union Square, right? As much as Fred made. Yeah, they were just they did what soccer did with Twitter, right and with. Over and started buying out people, but they did it, but they did it at a time where people were losing faith in crypto. There was like, you remember, there's like this big crypto winter. Yeah, there was a big crypto boom and like I'd say December of 2017, January 2018, then it kind of collapsed and that, you know, it mirrors the price of Bitcoin. You had Bitcoin reached a peak of about 20,000. That crashed all the way down to four to three or 4000. Obviously that was a great time to buy Bitcoin, but it sounds like these guys are also buying Coinbase at that time. So that was a pretty, that was a remarkable. By the way, it's a, it's a, it's a good validation of Brad's point about, you know market perturbations being fairly independent of value creation over the long run. And you know if you have faith that this is where value will be created over a period of 10 plus years, you know you're you're when you have an opportunity to buy in, buy in and don't let the market perturbations drive your decision making or else you end up in this market trading trap. I think we talked about this a lot. Warren Buffett talks about it a lot. I think chamath you've made the point about. Uh, not timing the markets, but your time in the markets and this notion that when you have conviction in a business or an idea or thesis, you know you can continue to to double down on that conviction regardless of whether you think relative valuations are appropriate or or kind of disjointed at the time. It's even more acute because what happens is we make short term decisions and then those short term decisions oftentimes to prove to be right in the short term and let me give you an example and then it leads to behavioral locking, so at the end of 2004. The bitcoins, at $1100 a share we get, I get very interested in crypto. I think this is one of the most asymmetric bets I see in the world, right? I have. I think it's a low probability event, but if you win, the size of the prize is absolutely gigantic, right? So we're looking at a deal with Andresen because I thought biology was one of the smartest people in the space. The company was called idea of mining for Bitcoin on a chip. On the eve of the deal. My partner and I, I said, you know what? I believe that we should place our bet in in Bitcoin because I'm not sure whether or not this mining company is actually going to work out. OK, so we pass on the deal. Crypto Bitcoin goes from 1200 to 300 in like a straight line down. And what was my take away? My take away was like, man, I'm so smart. I'm so smart. We passed on that deal, OK rather than being curious, rather than learning more rather than. Developing it. And what Andreessen did during that period of time is they stuck to their belief that this could be a highly asymmetric outcome. Ultimately, I ran into Katie Hahn, a board member at Coinbase the night of the IPO. And she said, Brad, you know, do you remember, you know, I was like, yeah, she goes, those were some of our original shares in Coinbase. We sold that company to Coinbase. Wow. Right. And and and, you know, it's just for me. I sent this note. To our team because I said, you know what guys, in the face of having some good wins, I wanna remind you of some really potent near near wins and misses. And my mistake at that point in time was I lacked mental flexibility. I got locked into this idea that I was really smart by having missed 21 dot dot Co rather than learning from that moment and saying, listen, when I started to see it move and then it moved pretty quickly and I was like, oh, I missed it, it's just like a stock. We do the same thing. The reality is you should allocate to things that you think are thematically highly asymmetric and great ideas and and and. This was one of them and and one we missed. Can I just can I said something like that I was in 21 does 2186. I don't remember getting any Coinbase shares, so I need to I need to somebody somebody you did not own the preferred. You'll find that you preferred, I did own preferred, I invested not clear the press stack you were in the wrong series with. One thing I'll add to that is you have to look at the mandate of these funds that if you're an early stage fund and you have the ability to sell AT500X or 1000 X or 2000 X, sometimes you've got to lock that in and give something to your LP's. And I think this is where, you know, thinking full life cycle. You said chamath like, what did you learn from all this? Well, if you're if you're building a business, right? Well, I mean, one of the things I learned is I didn't even know what prorata really was when I started my career. I didn't do prorata in Uber or anything. And now my position is I am going super pro rata in our winners. So not only holding winners, I'm trying to get to 1015% ownership in these companies. And it's starting to happen, you know, with companies that are worth 500 or 700 million. And so that that is the economy. That's the change in behavior I'm doing, which is, you know, to your point, if you bought Snowflake at any time, you feel great about it, but then you have to have buy in from your LP's that they agree with that and that they're OK with you taking a longer strategy and then at some point you want to return. Capital and that becomes super problematic and you're in 78910 of your funds, you wanna take some chips off the table. And So what I'm going to do now is I think I'm going to try to do both where I have a group of LP's who want to buy shares and I don't know how to figure this out. And maybe somebody could advise me here because I have had other venture firms who had this challenge where the growth, I don't want anything you own. Be careful. Why do you set yourself up like that? No. Yeah, I'm looking for advice here, but it's not if you don't talk about the whole point of this podcast is for me to draft off people who are smarter than me. Uh, mission accomplished. So here we go. Yeah, we still have to teach you how to separate LLC to buy your house. I mean, it's unbelievable. Sorry, I'm an idiot, Nouveau rich. But here's the issue. Can I be an Angel investor in Uber and then be selling shares in Uber to my other LP's and creating that socka secondary market? Or is that conflicted? You know, I'll tell, you know, I think this is public. I don't know if it's public, I will say it anyway because I think it's well known. But Founders Fund had early SpaceX shares that they thought it was prudent to sell in the early funds, those SpaceX shares. The later fund was buying SpaceX shares in that round. And so they were in a circumstance where they had such a big markup on the early round, the early fund that they had to kind of distribute and liquid liquidate those SpaceX shares. Meanwhile they're. Someone with a good overlap of LP's, we're buying in the other fund at that, at that higher price. You are speaking to something. I lived out in the early venture funds of social capital because when it was not entirely my own capital base, I felt that pressure. And I did similar things because I was like, oh wow, we're in year 789, you know, I had and I had great LP's. It's like, wait, I how can I not give capital back to the broad or Mayo? These are phenomenal institutions. They weren't. Pressuring me at all. But I felt internal pressure and I started to make suboptimal decisions for myself. I couldn't make really, you know, clearly the best optimized decision, which would have been to hold everything as long as possible, you know, to your point, like if you're in the top quartile of things, the best thing is to never sell. And it's an incredibly special place where you can actually have that freedom to do it. But it's what's interesting is I actually think that the folks that are in the best position to do are actually employees. And you I actually think that there are. They're randomly doing this. When you look at the churn rates of employees today, like I saw this crazy stat, the average tenure at Uber is 1.8 years. That's crazy. The average tenure at Tesla's 2.1 years, the average tenure at Google is 3.2 years. So if you think about a traditional 10 year career in the valley, you have somewhere between, you know, three and five, three and five different baskets of shares that you're getting and you know those are, those are cost less options effectively. That's actually an incredible form of portfolio construction for these people. Because if you never have to sell those things, you can wait till they go public and you can underwrite them forever. That's probably what a lot of employees in Silicon Valley have figured out implicitly. I have a question I want to ask you guys as well, which is, I just want to go back to the public markets for a second. I tweeted out some of these amazing things I learned from the Bezos. Oh my God, this is demented. Did you guys see what I what I tweeted? I saw your tweet and I've been reading it. It's unbelievable. It's been at. Do you have it in front of you, Jason? I do. I'll just give you the chamath tweet here. High level, 28% of purchases. On Amazon are completed in less than 3 minutes. I think we've all done that. 50% of purchase is on Amazon are completed in less than 15. And if you actually look at that, and I think this is a really, I don't know if you made this calculation, no, this is, Bezos wrote it in the letter. All of these things are. So if you value your time at $10.00 an hour, a very low one, that's $750 a year. And that means your prime is free of $120.00 a year. So let me, let me 630 in profit. Let me say it differently. The average trip to the store, driving, buying, coming back is an hour. So what Bezos said is that typically we will save you 75 hours because we can make all of that more efficient for you. At 10 bucks an hour, that's worth $750. We only charge you 120 for prime, which means you're you get $630 of savings. But then he goes on to say and we have 200,000,000. Customers on prime, so we're saving them $126 billion. My instant reaction was two things. And so the last two points in that tweet are mine. One is holy **** that's more in one year than what most companies are worth in their entire lifetime. And the 2nd is that you can buy Amazon for 13 * 1 years worth of savings for a customer if just if you look at prime. Yeah, which which makes Amazon seem exceptionally cheap, but I I reason I brought up Amazon is he also wrote in there about his responsibility to his employees. And we were just talking about employees and churn. And this was incredible to me that 70% of their employees voted down the unionization effort in Alabama. And I just wanted to get saxy poo red redpilled crush it, snort it. What do you got to say? Yeah, well, I mean, what what happened is you had in Alabama, there's a Amazon plant there that where they they're basically was an election to decide whether they would go union or not. And there were 25136 workers who voted. In this Union election, about 1800 voted against unionization versus 738 who voted to unionize. And then ballots from another 505 workers were either were challenged by either Amazon or the Union. So we don't know yet what they mean. But those votes won't change. The outcome of the election is over now. This was a heavily lobbied election. I mean Amazon was lobbying employees, but so were the unions. And it looks like the unions at the end of the day or lost. And the employees voted to, you know, remain unless. Brad, what do you think? I thought it was a beautiful defense of capitalism. That's very much needed right now. Yeah, you know. It reminded me a lot, frankly, of the Gates Foundation annual letter. You know, where Bill Gates is saying, you know, capitalism is far from perfect, but it's resulted in the most important era of prosperity and health and Wellness in the history of the planet. And, you know, as I said on CNBC this week, you know, we live at a moment where capitalism is absolutely under attack. And I truly believe it's the greatest force. The greatest potential force for good in the world. It brought us a vaccine, right? It brings us innovation that pulls people out of poverty, that makes people healthier, that gives an opportunity for people in rural areas that are impoverished to be educated. But I do think it's incumbent upon Bezos. I think he this was very much a robber Baron, sort of defense of building railroads. And I thought it was brilliant in its execution, but I think it's important in it for all of us. To stand up, not defensively, but to say what are our obligations to make capitalism the greatest force for good, you know, chamath, whether it's you and I talking about Invest America on CNBC and giving every child in this country a participation in the ownership society, right? Or all the other initiatives that we need to work on to, you know, to, to make the case we need to make it better. And I think one of the issues here is, you know, what we see on Twitter being part of the Twitterati is, you know, people who are super woke. Socialist whatever, talking about this. But in reality, the workers don't want it. And I was talking to somebody in the media. No, hold on. Can I just say something slightly different, Jason? I think what workers don't want is the version 1.0 of unions, because I think what they see that as is a tax that then goes and fills the coffers of certain people. I think you've seen like, you know, a bunch of waste, a bunch of graft, a bunch of corruption. People have been arrested. Unions are not effective anymore in collective bargaining. They are not, they don't have any data, they don't have any facts, they're not, they don't have any power, but they're not set up to win. So I think, in my opinion, I think unions have an important role, but you need a version 2.0. You need some young, smart, bright people to reframe what unions are. And then I think you would see everybody collectively organized, which is, it's not about dues. You don't need hundreds of millions of dollars to to all of a sudden. Like, use to then elect certain people and that old model is breaking. It's breaking every day. Instead, I think what people need to do is like if you come together and like you understand what are the products we make, what are the margins we have, how is my contribution measured, you know, and then you're able to use data, in fact to really collectively bargain. That hasn't happened yet. So I think what it would be or it could be a free market and people could go work at Starbucks or for post, both are good. I paid more. But if capitalism allows both to exist, if you, if you think about what? Union is. You could almost make an argument that it is the ultimate. Manifestation of a free market system because it is basically like a bunch of people spinning out to have their own startup. And so you know that that group of people are saying we're not charging enough for our product or service today. The value that we are creating is worth more. Therefore we should go create a you know a different business and charge more and effectively compete in the marketplace with a higher quality product at a higher at a higher price point. And I think that that may be kind of you know the the the distinction between what people kind of view to be regulatory capture. And unions, where there have has been government involvement in the past versus what may be possible. I think I've heard some people talk about how, you know, at some point in the world we end up with you at some point, the evolution of capitalism, you end up in a place where there are no employees. There's just a ton of independent contractors doing independent work. And maybe there is an organization of people around doing the same work over and over together as a group where you charge one kind of, you know, aggregated fixed rate for that service the other. The other thing to me was like all of a sudden it brought into such a stark contrast. This wasn't like 55. 45 This was 7030, and probably it could have been 8020 or 9010. And so it's said to me, wait a minute, there's a very small, vocal group of people who are screaming from the mountaintops about this level of unionization and organization. And then the people that are actually the participants of that system are like, no, thank you, yeah. Well, I mean it. It shows that Amazon does a great job managing, right? I mean, they they create enough value and they they're big enough for the service that people don't feel like they're being underbid. Media companies have been going through a unionization process from Gawker to Vox. The New York Times has already had one, and you're starting to see a bunch of folks voting on that. I was speaking to somebody who runs one of these companies, and they said the in the short term, it's fabulous because. They set the prices of employees. So when somebody comes here and says I want a raise, they say, well, we can't because here is the pay scale that you negotiated. So we have to stick to that. And I can't give you more than other people because one of the things you fought for as a union was pay parity. And so you've got five years, here's what it says on the chart, five years. So it made everything predictable. And they said they like that. They said the problem is. Over the long term, when you get to year 10 of a union, in order to fire somebody who's not doing a great job, you have negotiated with the Union that they have to get all these warnings and it's uncomfortable. So then the managers don't do the performance plans, they don't do that. And then eventually, who's left in the organization? The lower performers. And then who leaves the higher performers who can command more money. So once you get this Union, then going inside of a media company, in the short term it controls costs. In the long term, it kills excellence. This was what somebody told me. Have you guys seen the movie American factory? I think this was on Netflix. It was actually created by am I. It was the first film produced by Barack and Michelle Obama's production company. But it's it's a very interesting film about there's a Chinese billionaire who goes to kind of the Rust Belt to outside a little city outside Dayton. OH, and there is and basically opens a factory. Producing glass windshields for cars and this, this factory had been shut down. The whole town was kind of out of work. They were kind of down and down in the dumps. And so this, this crazy Chinese billionaire comes in there and reopens the factory and all he will and and and it creates like 2000 jobs for for people in this town and everything starts off great. There's these really interesting sort of culture clashes between the American workers and the Chinese executives and some of it's kind of comical. And they showed in the movie. But then about halfway through the movie and and and by the way, like, these are people who are out of work and, you know, this Chinese company comes in and they they do things kind of their way, but they pay people pretty well and creating a lot of jobs. And initially everybody is very happy with it and the politicians are all encouraging it. And then about halfway through the movie The unions come in and the unions start agitating and they start telling all the workers that you're underpaid, you're mistreated. They start, you know, there's, there's there's sort of intimidation tactics being used. And then the politicians come in and you know, these politicians are sort of, you know this Ohio, right. And so the politicians start telling the the workers at this plant that they should get unionized. And it turns into this giant battle because and and the the Chinese company basically threatens to leave because they came into this town and made a something like a $500 million investment in this plant based on an understanding of a certain cost structure and now all of a sudden the Union wants to change that. And, you know, it turns into this giant conflict and you realize that, look, that workers in this town had a good deal, and then the unions are about to like, blow the whole thing and and wreck it. And they're about to drive this Chinese company out of the town. And then they do this election kind of like what Amazon did. And ultimately the Chinese company wins and the voters choose not to go with the Union, but you just feel like you can. It's just so frustrating to see this because it's it's not like the the, the this particular union is benefiting the workers. It's about benefiting these union representatives. Paying off the politicians, which gets back to our discussion, and you're a little speech for your governors, I'll run that. You're going to fire all the teachers come September 1st if they don't show up for work. But look it's it's a really interesting movie because it because I think what it does is it highlights that what's in the interest of these labor union leaders is not necessarily what's in the interest of the employees. Anybody wanna. No no they're this guys look that this is like the simplest form of incentives to understand. You pay dues as a union member those revenues get allocated and controlled by a handful of people in Union leadership. So this is this shouldn't be a surprise that their incentives get misaligned, especially when you go from a small effective. Union to a broad you know, union that represents all kinds of different workers. It's an impossible infrastructure to manage, and it becomes unwieldy. Unions can be effective. There is a value in a place for them. They need to get reinvented. By the way I looked this up, you know, the average wage, the average fee is to be in a union across all unions in the United States as a percent of Labor. And when you got 1 1/2%, yeah, yeah. So the argument is if they can increase wages net to those employees by more than 1 1/2%, it pays for itself, right? That that's the argument. Totally get it. There are startup in and of themselves. They are an asset manager, right? Their goal is to grow assets, yeah, and so, so, so the more assets they grow. You know, the, the, the, the bigger their business, the way in which, you know, relating this back to Bezos is annual letter, right. We've been presented this false choice for two decades. Between some form of and Randy and capitalism and a nanny state. Right, right, right. They they they either everything's unionized or we have no intervention at all. But what I love about this moment in time, what I love about the leadership of Benioff or Bezos or Gates or even Anthony Tan, this incredible mission values driven leader who's using the power capitalism to uplift 10s of millions of people in Southeast Asia, is that. I see a totally new generation of leaders that understand the responsibility, like they're charting the middle way, right? And we can equally reject Lorena Gonzalez, right? And at the same time, we want to have $15 minimum wage in the state of California. Like, those two things are mutually compatible. And so that's why Sax has to run. He's got a chart the 3rd way. Let me ask you this, Brad, would you put up 250K for an exploratory fund, Brad? Back do you put, do you do you believe in a $15 minimum wage? Ohh, I'd be fine. I'll be fine with that. It's not that that's not that's it's on. He took a blue pill. He took a blue pill. Give everyone everything. Certainly in the state of California. I think that makes sense. You know, I think there might be some parts of the country where the standard of living is much cheaper. I mean, I think probably the minimum wage should be a state issue because there's such a disparity in different cost of living in different states. So I'm not sure I'd federalize it, but I'm but certainly in California. 15 bucks. I mean, what about 20 bucks, David? Yeah, David. 20 bucks in California? Why not? Why not 1000? Yeah. David Allison winner. Can everyone get a free Tesla? No. But can I make, can we make the point about unions in California? I think there's a huge difference between private sector unions and public sector unions. So and look I'm not against collective bargaining when it comes to these private sector unions, OK because the the workers do have you know these these plants involve can involve very tough working conditions as physically dangerous you know that they're before there were labor reforms they're working really long and saying hours or safety issues. OK. I think it makes sense to have some sort of collective bargaining and there's somebody to. Negotiate with there's the management of the company has an incentive, and so you have some give and take, and you have a negotiation that produces an outcome. Public sector unions are completely different, right, because when the teachers union goes to negotiate, who are they negotiating with? They're negotiating with Gavin Newsom, and the Teachers union is his biggest contributor. So who has an incentive to oppose their demands? Market. There's no market. And so at a minimum, takes a politician who has a lot of integrity. To stand up to the teachers unions because. He did it in Bloomberg did do it, by the way. By the way, this is, this is a true market dynamic for everything as it relates to to government spending. If you think about when when the government says it's going to spend something on someone on something, legislation passes and it mandates that something needs to be bought. When that happens, there is no negotiating power because there is no marketplace to achieve that objective. They have to spend the money on the thing that they said they were going to spend it on. And at that point there is a seller who sells that thing who says, oh **** these guys. Have to buy it. I'll double the price. OK, great. That's just the natural law of government inflation. That happens. It's happened with everything that we've seen inflated in this country. Education, Healthcare is all because it's a government mandated service. And so then the service providers to the government have a single captive customer who has to spend the money. And so the same is true of education. The government has to educate. Therefore, I can show up as an education union and say I'm going to double my price to educate your people because you have to do it by law and you've passed all these laws that say you have to do it. And there is nothing the government can do about it. And so, you know, I think it is worth highlighting that there the the lack of a marketplace, meaning if you were to negotiate with a company, let's say a company had to buy productivity software for its employees, it could decide whether or not buying that productivity software generated a positive return at the price point that the sellers are negotiating against them. And they say, no, you know what? I'm not going to buy it. Everything's too expensive. I'm going to go find another way. The problem is governments are mandated to spend that money on that particular service and therefore there is no room to. And so, so unions are a manifestation. Of this fundamental problem with giving governments large budgets and relying on the government to provide the service to us outside of a market driven context. So I think the question really is can healthcare, can education, can these things that have been inflated with the government having such an active role be provided in a way that the government facilitates their provisioning without the government being the customer? This is a good jumping off point to one very to the next then topic. There's a bunch of things happening in government that I just want to get your guys's reaction to one. Which was the crazy summary that somebody did about the reaction to Biden pulling out of Afghanistan. OK, the second is unfortunately, Biden reiterated Trump's decision on refugee numbers just today. So he's not, he had a pledge that he would, you know, go back to the, the original numbers, the Obama level numbers and he said he's not going to, he's going to keep it at the Trump level, which basically says, you know, very nominal refugees and then the third is. The growing frustration and perceived incompetence of the CDC and now you have the entire business community starting to push back. Those are three completely different things, but they just speak about some government things. I'm curious about your reactions to anybody. I mean, the thing that that highlights for me is the media double standard. And I think This is why a lot of people are going to centrism and why this podcast has become a purple podcast and a rational podcast because AOC was going down to the border hysterical crying. You remember the photos? They were all dressed in white. And is there any difference between what Trump did at the border and what's happening now? Doesn't feel like it feels like it's a problem that they're both trying to solve and it's 90% the same outcome. And then you look at Afghanistan, you know, Trump's like we got to get out of here and then the press dunks on him like how could you do that? And now Biden's doing and he's getting high fives. And so I would just like to see some consistency from the press and the reaction and Americans on these issues which seem to be non winnable or you know, how much do you lose in these instances like. Afghanistan is a lose lose and the border is a lose lose like there's there's no winning I don't think in these in some of in some situations that a president has to face. I'm interested with sacks has to say well yeah I saw that I saw that tweet storm on the media double standard around Afghanistan. We should show that and and link to it in the show notes because the the whoever it was incredible. It's incredible. I mean this is like definitive proof of of the media double standard where he goes literally he does a side by side of every single major prestige media outlet there. Coverage on Trump versus Biden's drawdown in Afghanistan. You know, Trump, Trump did a major drawdown and I think got us down to maybe like 1500 troops there. I think he missed a political opportunity not to go all the way down to zero. Then he could have taken credit for ending the war, which I think he wanted to do for whatever reason, he didn't get it done. And he basically handed Biden a beautiful opportunity just to kind of end the war once and for all. I think it's very popular. People are, we've been there for 20 years. I think people want to get out. So I think Biden's decision was. Politically correct. And I think it was the the the the the right decision as well. I think we've it's it's it's time to be out of there. But yeah the the coverage in the press was just completely hysterical about Trump doing it. It was predicting all sorts of negative consequences and then when Biden did it like like Jason saying it was nothing but kudos. So. Well, you know, not not not not not only is a press not objective and not impartial, but they change their mind about a particular issue based on which team is doing it. Yeah. I mean if you look at the two quotes. They have a CNN tweet that they then he just screen grabbed CNN on the same issue, says this is reckless and it's really risky of Trump's plan to withdraw troops. And then the next CNM tweet from this administration, President Obama praised President Biden's bold leadership to withdraw from Afghan Afghanistan by September 11th. And there's dozens of these NPR, CNN, New York Times, Washington Post and over again. And then I think This is why Americans hate the media. Absolutely. I mean, this is the, you know what the. Look, the Conservatives, I would call the mainstream media, you know, MSN, I mean, but they are proving their bias right here. I mean, and and they're increasing irrelevance. This is why the American public don't trust them, don't listen to them and don't care what they have to say. Brad, what do you think? Well, I wanted to, you know, at a federal level, we really can't opt out of any of this, right? We're not going to leave the country. We got an election every four years. So we're just talking about market failures in the state of California and one of the most beautiful designs of our system of federalism. Back to this idea of markets, right? Is the fact that you get to choose what state you want to live in? And in a post COVID world, we have the greatest AB testing in the history of federalism, because now you can live and work from anywhere, and the differences between state policies have never been greater. And so we've never had this incubation that we can all watch and live tweet about on Twitter. And so now Texas and Florida, they get to make choices. California gets to make its choices. And then we get to see and political scientists are going to have a field day in five to 10 years and people are voting with their wallet today, the AB test in real time. We have the largest economic migration in the history of this country occurring right now. And Gavin Newsom and Lorena Gonzalez, they're going to have to be held accountable for the conditions in San Francisco, for the decisions with respect to companies leaving the state, people leaving the state. And frankly, it's not about lower taxes. I would contend that even bigger issue is the contempt for capitalism. The contempt for entrepreneurialism and innovation that exists in California. And I have no intention to leave, but I will tell you this like I'm going to fight like hell for a third way, right? That actually says capitalism can be a force for good in California, and that's why Sachs needs to run. It's actually my I I love I I love this idea of a of a state by state AB test. I mean what was the old line I get it was the IT was FDR's line. That or federalism is the laboratory, the states of the Laboratory of democracy. So I want, I want to show this. I just posted a link in the chat of COVID death rates in the US by state and it's really remarkable because every state has very has we've seen a lot of very different COVID policies by state. What we see is that California and Florida have almost the same death rate. I think California's like 154 per 10,000 in Florida is like 159. It's a very, very small gap despite the fact that California has had the longest and most severe lockdowns in the country and and Florida has been the most open. And then meanwhile you look at states like like Michigan which has also had very severe lockdowns and has had a much higher death rate. And so you see that there's there's really no correlation between death rates for COVID per capita and the the. Severity of of lockdowns, basically the data shows that lockdowns don't have an impact on estate success in battling COVID. And you know, it's just remarkable that we still aren't despite this data despite the fact that, you know science is now showing us we still have lockdowns in the state of California. We've loosened up a little bit, but we're still talking about orange tiers and it's just and I'm here in Florida right now, they're there, it's open, it's open and. You know, Florida has a lot more old people than California, and the death rate is just about the same as California. So it's just remarkable to me that we are stuck in in this mentality of lockdown. And I think it's because Newsom has bought into this savior myth that he has. I think he's remembering all this press that he and Cuomo got at the beginning of COVID about what great saviors they were and how they protected the population from from COVID. But it's also been compounded by federal failure. Because the CDC basically said or not said they revealed themselves to be incompetent. You know, the same person that we all thought was an incredible genius. Fauci increasingly looks like a somewhat of a an idiot and, you know, not completely informed on the topics that he should be informed about. And then, you know, you have these federal agencies. So for example, when you put the CDC in the FDA together, some of their decisions are just complete headscratchers like for example this past week, you know, the FDA. Stop the use of the Johnson and Johnson vaccine because seven women between the ages of 18 and 48 got a blood clot and one passed away and if you think of over 7,000,000 doses. Right. And So what? It's it's literally. Fatality. And actually, here's the crazy thing about more people died in car accidents on the way to getting those vaccinations and actually died from a blood clot and so more lightning strikes. So it's it's it's bad risk assessment, but it's also been very bad PR for for the vaccine. So in the wake of that the with the polling on vaccines went down by like 15 points and so they're scaring people away from getting vaccines. I don't know if that polling was just on J&J or whether it applies to other vaccines as well. But the most important thing that the health officials could do is just convince people to get vaccinated and the decision they made on rolling back J&J has really hurt that and then also this you know that. The Fauci comments that even if you're vaccinated, you can't go to movies, you can't go to sporting events, you still have to wear a mask. You still can't, you know, get together in groups and indoor spaces. Well then why would you get vaccinated? Why would you take that chance? That is so critical. Friedberg. Do you think if you get a vaccine you should be allowed to take the mask off? Like that could be a reward? Look, I mean it's a it's a bigger question than the science question, right? But I certainly don't think that there's any risk to you or people around you once you've been vaccinated with respect to you're wearing a mask. And so, you know this the, the, the mask mandate, I think, as you guys pointed out, is a little bit more kind of political and social posturing than it is kind of, you know, scientifically reducing the, the, the, the spread of the of the virus. Once you've been vaccinated, once you've been vaccinated, you're in the clear theoretically can do what you want to do, of course. So. So, I mean, let's just be really clear. Once you get vaccinated, there's no reason to wear a mask. Remember, the reason for the mask mandates was source control, right? To prevent other people from getting the virus. Well, if you're not carrying the virus and you're not admitting the virus, there's no need for you to wear a mask. And to and to and to. To insist that people wear a mask after they've been vaccinated is performatively anti VAX, because you're sending the message that the vaccines can't be trusted. You agree with that freeberg? Yeah, it's a fair point. I totally. I mean, I think it's a, it's a really fair point and. And, you know, the, the, the, the whole counter argument to that which is counterfactual is, you know, hey, you know, you can still transmit the virus. We don't know that you can't transmit the virus, but you know, you could theoretically say that about anything we know deterministically. We don't have empirical evidence that we can say statistically, here's how likely you are to transfer the virus, but we know deterministically. This is the process by which a vaccine works. You're not going to be having replicating virus viral loads in your body. Therefore you're not going to have a high viral load coming out of your nasal passages in your mouth. Therefore, you know. And this is the case with all these kind of vaccines like the flu we, you know you shouldn't be or be needing to have to wear a mask. So like you know totally makes sense. And what's the upper bound Friedberg of the number of people that are, that are going to get vaccinated in the US are we going to get to 60% or 60%? Probably, yeah I would guess. Sixty, 6065%. I mean because remember what percent of people under 60 and 20% I think is that right? Yeah. I think we've really, we've really, we've really botched this. I think we've totally botched this vaccine. Roll out. By the way, I will tell you because of the the upper bound being where it is, I I still think we'll end up at a point where we're going to have a lot of people that are going to be immune because they already had COVID coupled with the vaccine. We're going to have extremely low numbers, but the reality is the numbers are not going to get to 0 and we talked about 0 ISM a couple podcasts ago because we're not going to get to 0. I think this is a really important thing to remember the way that we've tuned ourselves to react to COVID it it was initially remember it was initially about. You know, minimize the surge and by minimizing the surge, we will keep the healthcare system from being overwhelmed. Now we've transitioned into the we can't let COVID spread. But as we've seen the reality is cannot stop COVID from spreading. No matter how many lockdowns you put in place societally, people still get together in their homes and they give each other COVID. And because some number of people will continue to have COVID, we are going to have COVID in the United States for years to come. It is not going to go to zero. And the question we have to ask ourselves is how are we going to allow ourselves to operate? Are we going to live our lives if the COVID risk is non zero and it will always be non zero? And by the way, the measles risk is non 0. The chickenpox risk is non zero. There are already non zero, you know, transmissible infectious diseases out there that have some degree of fatality rate to them. But I think the biggest thing we should all be concerned about is this notion that we are like shifting into a new normal that will last for many years because we will never be at 0. So can I, can I just out of California? If that's the case I'm literally going to. There will be. Good, nice. There will be. I'm done. I got my vaccine. I'm people, people that nobody's going to stand for that. We already see it, you know, Chesky went on CNBC this morning and you know, basically said, you know, they are battening down all the hatches because there's no like the demand for travel is literally going to blow the roof off the building totally, right. Like people are over 2 smart people make risk, reward decisions in their personal lives every day. And if the. Government tries to lock them down. They're going to tear down the gates like it's not going to happen. But what you what you're saying though is that what the implicit thing about what you're saying, which is scary is, unlike times before about measles or chicken pox, you, we now are basically debasing the credibility that these government institutions have about anything they say that's the real enemy in the room. And this is all said and done. So now you have people that are acting on their own. So the CDC says you can't fill the middle seat the airline say no, go **** yourself. We're going to fill whatever seat. Want. And nobody's gonna complain back to what Brad said because their risk underwriting for themselves and saying, yeah, wait, you don't know what you're talking about anymore. And so where does it leave us? Is that a good thing or a bad thing? You know, one of the ways states, even even democracies, maintain power was information control, right? Right. And there is no information control today anywhere. In fact, we have frictionless information, which means that by definition, I think there's greater chance for decentralization. I mean, remember, you know, the Arab Spring governments. Were overthrown on the basis of Twitter, right. I don't believe we live in a Hobbesian state, you know, of suffering in in the natural order of things, right. But I certainly believe that government has a role to play to help organize us and, you know, because there are big issues that we face in the future and you know, I just hope we can find a balance, you know, in the path forward. But this I I think chamat, this is a an inoculation, I think, to. At institutions, if you look at people who spent $250,000 going into debt at some big expensive college, these young folks are saying, I'm not going to do that anymore. Now those colleges have to react and change and now we're seeing it with the teachers this. But I think, Jason, it's actually more extreme than that. Like we're learning that institutions aren't reliable, number one. And then the second is that we're learning that those institutions are static. So meaning like today there is, I think that there's a lot, there's a big case. Be made that the CDC doesn't really know what they were doing and that in some cases the FDA has been a little overreactive. OK, now what can we do about these things? It's not like we can have a new CDC that we all create and believe in or a new FTA. These are the laws of the government. Those laws won't change because there's a bunch of incentives for folks who are currently in power that oversee those things to remain that way. So now you know exactly as SAC said. On the whim of frankly, like, you know, maybe an overreaction, we pull vaccines off, then we pull them back on, then we pulled them off. You know, the reaction to the AstraZeneca vaccine was kind of a little awe inspiring, you know? Oh, it's bad. No, it's OK. Oh, it's good. No, it's bad. Take it off, take it on, put it on. And that's a, that's been a global reaction. So you Add all of these things up, I think the take away is what Freebook said. Institutions are broken because the incentives of the people that run them are not aligned to the people that actually. Expect output from them. I'll say two things to this that that's an important .1 is institutions, to me are like, like, like any living Organism. They want to grow. And so, you know, every government wants to add laws, spend more money, grow its budget. Every company wants to have more power, grow its top line. Even every university. Harvard's endowment wants to grow over time. It wants to do more research. It wants to have more classes. It wants to have the bigger campus. Every institution, as a result, is then trying to aggregate. More resources and more power and more authority. And so you know, then when you have these moments where the institution doesn't serve the stakeholders that it is meant to serve, you have this breakdown of trust in the institution. And institutional fallout begins. Whether that's the financial system and the and the evolution towards decentralized finance and Bitcoin and so on, or the failure of government and the ignorance against laws and what the government is telling us to do and so on, or in companies. And so the big question for this century is going to be, are we going to allow that to happen now? I mentioned this a few pods ago. What I'm most concerned about is the absolute alternative to an institution as a mob rule and a mob rule as we've seen, where you get cancel culture and you get, you know, GameStop going through the roof and and you get a trial before, before, without a jury and trial without a judge can be really ugly and can be really nasty. And so the original intention of many of these institutions was to create a system by which there are rules and values that we all ascribe to and those. Values go out the window when those institutions fail. So the big, the big challenge you know, we as as a, as a, as a, as humanity are going to face this centuries, this, this, this dichotomy between the failure of institutions and the need for institutions to constantly grow versus the challenge of not having institutions with respect to how do we operate societally with mob rule and distributed rule. And and it's going to be interesting to, to kind of see there's going to be a lot of back and forth over the next couple of decades, I would imagine with respect to how do we make economic government and business. Decisions and how they play and whether institutions or kind of distributed decision making plays a role in that oversight. Good segue here to your pal Josh Hawley. Hawley Sacks I I never thought I would see the day that a Republican wanted to bust all the big companies, but he says no acquisitions by companies with a market cap over 100 billion. Putting aside the fact that this wasn't Elizabeth Warren or Bernie Sanders proposing this, this was Europe. Your bestie? You're Josh Hawley sacks. Have you met him or donated to him? I haven't met him. I haven't met him. I I think the second question, you make a little donation there to Holly. Maybe, maybe one day. We'll see, you know, see. What do you think about this concept? 2 two points. OK. Number one, you're right that this is showing, you know, there's, there's a big political realignment underway. This legislation could have come from Elizabeth Warren or Bernie Sanders. I think they would have justified it in different ways. I think what Halley's concerned about is a concentration. Of power by big tech companies who are then using that power to censor people. So that's kind of the impetus there. I think Sanders and Warren, their impetus would be around more of a concentration of wealth and money and the power that that creates. So slightly different motivations, but I think they're probably on the same page here. It's kind of this populist wildfire that's that's kind of burning and in both parties. So I think that's sort of the first observation is is, is it's kind of this new populist realignment of our politics. The second point I'd make about this is that this legislation. It's what I would call sort of performative legislating. I mean, I don't think this bill is a serious proposal to become law. It's too much of a sledgehammer. I think that, you know, if the goal here is to try and rein in big tech, I think just banning, you know, any acquisition by firms over $100 billion market cap, it is way too much of a it's just not, you know, it's not crafted enough. I mean, is there any merit to it? And how would you change its sex? It would have tons of tons of consequences. Or you know what we do. I mean, we've talked about this. Is it good for what we do though? I mean, if company stopped selling early, if Instagram and YouTube state independent, wouldn't this have been much better for them? It was a, it was a blanket. It was a blanket statement that said any company can't do it if they were over 100 billion, right. So Berkshire Hathaway's business poop done gone to zero. I mean, it's too much of a blunt instrument. And and look even for us, right? There's only, you know, three, I guess two or three good outcomes, right? There's IPO's, direct listings are spats. Let's put them. In the category of a company going secondary sales, yeah, then there's M&A, OK. And then the third outcome is basically the company goes under it goes bankrupt, right. So if you take M&A off the table, you are basically denying a lot of attractive exits for risk capital and that's going to ultimately hurt the returns for risk capital and lead to less of it. There are a lot of, there are a lot of companies where you know founders create a technology that's valuable and interesting, but it can't monetize and it needs to be part of something larger and if you deprive every. I guess big company have been able to buy of R&D acquisitions. It's sort of crippling the economy for no reason. I don't think it really addresses the issue that Holly really wants to address, which is censorship. So my point is I would find a different way to address it. I think that at the end of the day, this legislation is not meant to become law, is meant to make a statement. Be a warning to big tech and to get, you know, and and Holly's trying to appeal to a constituency on his side of the aisle. And I think it's sort of, it's just performative. It's performative in that regard. I mean, Holly, like, he votes against the election. He comes out with this asinine solution to his censorship beef, you know, like this is the problem, the grandstanding of these politicians on both sides that aren't focused on, like, how do we make sure that everybody's participating in the ownership? Society, how do we deal with, you know, you know, issues of diversity. It's, you know, it's so far removed from actual pragmatic solutions to the real problems facing us that it just drives me insane. And so he will most certainly not be getting a donation from our household and, you know, like, but what I am going to invest aggressively in, you know, and what I think we ought to be doing. And I, I, I, I hope chamath will take me up on this. Right. I don't want to go spend 10 million in Washington to lobby them to create the Invest America account. Let's you and I put up the money. Let's incubate this. Let's hire A CEO. Let's, you know, let's, let's put up 101015 million bucks. Let's distribute it to families. 2000 bucks at a pop. Let's build a proof of concept higher grade seal. That's what we do. And prove that it works. Yeah, that's better. That's actually a more practical giving pledge than the giving pledge. Oh my God. What a great idea. Yeah, we we should if we should just do that right now and basically name and shame everybody that doesn't want to contribute who's made money. Because the reality is we all have been extraordinarily lucky. Yes, we've worked hard, but frankly, you know, none of us deserve any of this. We've been lucky. And so whatever representative shared that you could contribute and what it does, it gives, you know, a low income person of color, minority person in America, somebody who's, you know, disadvantaged a $2000 head start when they're born is a ******* amazing. We can raise 100 million. Dollars in the next three months because do you know the reason people, people are like, I don't want to pay taxes because they don't believe government is going to use the money wisely. If we went out and told all these folks that we're going to use it to give $2000 directly. Right. To create a sense of ownership and participation in the American dream, their little slice of Tesla, of Walmart, of Amazon, of Google. Like the money will come in from all the folks that you mentioned. And I would love to see this crew get on board with that. Yeah, I think we could do it over the course of the next six months. I'm in. Let's do it. The audience who doesn't understand what we're talking about. Imagine we put $1000 into a 401K or 2401 K for an American, every American born. What would that look like when they're 65 years old? And what if 500 of the 2000 was in a 529? What would that look like when they're 18 years old, new, out of college? That was my little punch up chamath is, you know, put half of it in retirement, half, half in education. It turns out if you put your stimulus check out each of the last three stimulus checks into Dogecoin. You would have $300,000. OK. So there, there may be, there may be alternative investment accounts that. All right. Listen there's been another amazing sorry just so you know the $2000 by the time you're 65 at at 8% which is you know if you just buy the S&P ETF would be about 300,297 thousand more than enough to comfortably retire in style. And if you were to put 500 of it into an account for college, maybe you get 25K or something. I'm not sure what it equals in 18 years, but Buffett is talked about in Snowball. Behavioral economics are if you have savings, you save more, right with this is about the educational. Yeah, people feel part of the system, feel like they're part of the game. Alright, listen, another amazing episode. Brad. Thanks man. Thanks for coming on. Thanks for coming on. We don't have a nickname for Brad. We never kind of specs. Oh, just kidding. I'm happy to have, I'm happy to have the crown. Ohh I'm happy to have OHP. I would just, I just wanna be called King. Fine, boys. Somebody picked me up and let's go have a guys trip. What are we doing here, guys? Where are we going? I just wanna say, well, since David is in Miami, does David? Since David's in Miami, I'm going to tell you guys that my favorite prime number has always been. I don't know what it means. What's the joke? That's in my office. Put that out. Go to Miami. Let's go. Let me see you all next. I love you, besties. Love you, Brad. Love you, Brad. Brad say. Love you to sax. See what happens. Good. Did you try keeping up? Brad say love you to sack. See what happens. Love you. Sax. Back. Atcha. There you go. See you all next time on the podcast. Bye bye. Let your winners ride Rain Man, David. We open sources to the fans and they've just gone crazy with it. Besties? Play a dog taking out your driveway. Oh man. We should all just get a room and just have it one big huge order because they're all just useless. It's like this, like sexual tension that they just need to release stuff out there. Beat, beat. See what we need to get merchants? I'm going.