You have now created by my account at least four billion dollar companies directly, probably more than that. What would you say you are doing different?

Than the average good founder. So,

this, like, I have some unfair advantages. Right?

Okay, Joe. Thanks for Yes, man. And thanks for, inviting me into the the morning workout, the cold plunge, and, and everything in between breakfast. Good to have you here, I wanna start with lessons learned. You one of them that we were talking about this morning when we're doing a workout was, making decisions on blended

reasons or having like a blended strategy for how you're we're gonna win we're gonna win doing these five things. And why that sounds like a good idea to the average person, but it's actually a very bad idea. Can you explain that? Yeah. And I wrote this piece online, like, nine lessons for Peter till I sent to all of Palms here that's been, like, since all of my other companies as well, and it's one of my favorite pieces. And that's one of them in the It's one of these logic things where usually there's, like, one reason that dominates everything else. And and that that's just that's just the nature of the world is that is that when something successful,

it's it's kinda like the power law rule. Right? Like, an venture capital, like, fund even. There tends to be one thing that's successful that's, like, bigger and everything else. And that's true inside of companies as well. It's it's very unusual, like extraordinarily unusual

for there to be, like, two similarly equal, like, like, like, products or revenue lines or something like that. Especially early on in the company. So usually if you if you think you have, like, two or three reasons for doing something or five reasons for doing something, what that means is that you actually haven't figured have no actual reason. No strong reason. No strong reason yet. Yeah. Like, at this, that means you have five weak reasons, which is not good. You wanna find, like, what's, like, one really strong thing you're driving towards. And that that's how startups This is it's a really seductive trick trick. I mean, first of all, you have to be taking a big risk to even do a start. It feels like rather than, like, you know, most people, a lot of people like to incubators

oh, I don't wanna do one company. I'm gonna do ten companies. And, like, by the way, that's, like, much less likely to have big success because you're not focused. And then and so so but so even within a company, they're, like, they're trying to do thing. They're trying to be like, well, here's five ways I'm gonna make money. And, like, no, no, no, man. If you really wanna do a company, figure out the way you're gonna make money. And that and that tends to be how it works, you know. That applies to revenue streams. So eight revenue streams means you probably don't have one awesome revenue stream. Exactly.

Growth strategies. If you have seven things we're gonna do for growth means you Which one's actually the one that's gonna the one that's gonna just compound like crazy. And it may change it may change over time, but what's the thing that's working now you're pushing on? And then, the other version of that is blended reasons for doing something. I think, I read once that Reed Hoffman uses the same philosophy. And he said, he gave the example of Oh, if there's, like, a trip to China and I'm deciding should I go to China? It's far away. It's gonna take two weeks and should I do this trip? He's, like, and my chief of staff came with, like, a list of pros in cons. Yeah. It's like multiple pros. Multiple pros and then a couple of cons. That's almost impossible. It's a guaranteed way to make mediocre decisions is to do long blended list of If you don't have a key reason to be there, like, stick to your work. Yeah. Exactly. That's what he said. He's like, if I if we don't have one reason that that alone is worth doing, then we should just say no. Is that something you do? Read was one of the key key minds at PayPal, of course, with Peter Tiel and others. So who knows who actually came up with these ideas always be reed's ideas and I'm recycling it. It's a very smart guy. Well, I say the message for mine now. So it's all good. I think that's that's the best way to, you know, the highest compliment is to meme an idea and to, to let spread.

And so Peter's helpful with that. He's,

well, what are some of the other things? Like, do you remember I mean, even at the beginning,

One thing I I kind of wonder is you've been around a bunch of special people, Peter Teel, Elon Musk, all this stuff.

Is it clear and early, like, the early days. Like, do you remember the moment where you're like, oh, this person's kind of different. They are that five standard deviations

Yeah. No. An intelligence or conviction or whatever. One of the, I mean, we all try to, like, strategies for ourselves and goals and whatnot. Like, I remember in college, I thought, wow, this is a really good opportunity at Stanford to reach out to a bunch of successful people and kinda learn them, see who I see who I admire who I wanna be like. And, you know, I I I've met some of the legends of global macro finance who I'm still in touch with. I met a bunch of other big business and run fortune five hundred companies. And Peter to me had by far the most interesting intellect. He was he was clearly just one of the smartest people I've ever met, and he was interested in some of the same things. I was just interested in. He need taken the logic farther than I ever had. So so so I always I always learned the most from conversations with him. So that so that that to me was one of the reasons he was the most attractive to try to work with build growth. And so before you start multiple other companies, you do Clarium,

which is his hedge fund. I guess is the way Global Mac fund. Yeah. It's a it's like the most fun part of finance. There's always there's lots of parts of finance. Finance is, like, all sorts of areas. Global macro is looking from, like, the highest possible perspective that everything going on in finances, like, the the bond yields around the world, the flows of money around the world, how equees are being valued. They basically just, like, just from very top down, like, what is happening in the world finance, and how do you map it out? How you and you look at relationships and you understand, you know, of course, like, you know, the Australian currency is gonna be really correlated with the price of metals and there's ways in which they can get way off and you can create a regression trading system if they're way too far off where you can make money based on that reversion. Right? But then you say, oh, normally, I would trade this, but actually this is happening because because China just, like, you know, invaded this thing over here. So, actually, it's not a good time to do it. And it's just it's just really, really fun map of the world. And we were really interested in, like, long dated oil prices, what was happening with oil. We're very interested in how, Fannie Mae and Freddie Mac, which are the two big giant housing groups. They've gotten to be much, much bigger in the US than the two thousands and the and the they're they're these giant mortgage backed security portfolios. These are worth trillions of dollars, and they had to hedge these portfolios

basically, and and and I won't go into all the details. It's a little bit esoteric, but based on how they were hedging their portfolios was completely changing the global fixed income market. It's completely and the pricing of bonds. We found some really interesting ways to do things there. I I I I get my my my favorite story that I'll give you is just to give so we're working at the hedge fund. The market's open. We're in San Francisco. We're in five five five California. Right? That big building downtown. Like, after after nine eleven, I think Peter had a parachute in his room. I was told pair shoots for us too, but anyway. That's like there's one parachute. Okay. That was just the joke, but it's probably there anyway. But, no. So it's, like, cool off on the floor, second floor. And and the market's open at six thirty. So the traders are supposed to be in at six thirty. Except the first Friday of every month, you had to come in at five thirty because the non farm payrolls come out still now the first Friday of every month at eight thirty AM on the East Coast. And it turns out this is a very important number because it shows you what's going on in job growth in the whole economy. You know, based on the Bureau, they were statistics numbers. And and what was really cool is Kevin Harrington was our head of research. It's like genius crazy physics biology interesting guy. He's he's, and he ended up being on the national security council later, like, super interesting smart guy. And and he, like, had mapped out this thing I'd helped him with where we realized

that they were adjusting the numbers wrong, based on seasonal adjustments. And so we were able to predict whether number would hit or miss. And and this thing would move bondmark like, crazy. Like, like, hundreds of billions of dollars move around based on this number, and we figured out they're systematically mis misdoing it. This is totally legal. You're allowed to do this So we figured, okay, this is a mistake. Seventy five percent of the time, we can make money trading this. And then we can adjust it, make it even better based on where the market was positioned. So the market's gonna surprised and we could kinda tell you a good chance it might be, but we take a big position. Right. Like, the night before or whatever. And then, like, make a ton of money that morning when it worked. Four thirty in the morning. Wait. So the best seventy five percent chance. And so if you do it enough, you're gonna do it well over time. And it was the most fun thing because we take these, like, giant positions on this thing. And you'd be there with, like, Peter and Kevin. This is just, like, the high high stakes game of poker gameplay. It's the most fun as a game of poker, and you're, like, literally personally have, like, million dollars riding on it at a time as an early twenties. These guys, you know, Peter probably had a hundred million dollars riding on it every time. And and you're and you're, like, high fiving if it goes right or you're depressed, if it goes wrong, is the most it's, like, it's his most fun high stakes you know, brother. Is he sweating or what's his, to give your life? He wants, like, what's gonna happen? It's, like, so exciting. And then like, I remember so many, like, celebrations. We'd all, like, go to, like, our favorite breakfast place afterwards, so it worked out. It's it's pretty cool. Yeah. What'd you do if it didn't work? Yeah. Sometimes we go there anyway. But but, for some reason my mind, this is maybe who I am. I remember all the times that worked out. I barely remember the times it didn't. I know it didn't sometimes, but, like, maybe this is, like, serial entrepreneur sort of thing where you just have the good memories, you know? Right. Yeah. So it's like, but a memory is it was it was a fun time. That's a entrepreneur survival

attack sick.

Yeah. Because if you know, if you remember how hard something is, you're very less likely to start it again or do another thing. The only way I would have built all these companies if I had to myself to, like, think about that too much. Yeah. You the way you just described, like, the global macro fund, you're pretty young when you're doing this, and that's not what you were doing just four. So it's not like you had tons of experience. My my little brother got me reading, like, a bunch of economics and finance stuff when I was young. So I kind of had a weird both computer science and finance background. So and I had opinions about it. So that's, like, is that weird. Those are, like, my two things. And so it's, you know,

the so I I knew that world pretty well. And, yeah, you learn a lot being in just do. You just have to be in it to do it. But it's, I mean, credit to them for betting on you to be able to to do that. You know, they could have hired somebody who's been doing that for twenty years. This is this is we talk we talk about lessons from Peter TL. I think one of the most important

ones I've seen from him that I've definitely taken to heart and what I've done is a much rather high higher a much rather higher for talent and ambition and hard work than higher for expertise.

So I'm almost and there's exceptions. Right? So if if you have a company that's already really working and already really scaling, and there's, like, a machine that has to be run, you wanna hire the guy who knows how to run the machine. That's fine. That's, like, that's, like, that's the operator who knows what they're doing already. But when you before you've actually built the machine, when you're doing something with a group and, like, kinda high finance or whatever,

you wanna hire for RyIQ and hard work and just iterating and figuring it out. And that's that's a different skill set than the people who run the machines. Hey, real quick. As you know, we're big on ideas here. We love bringing new ideas, business ideas, brainstorming ideas for the podcast, Well, a lot of people ask, what do you do with all those ideas? Can we go find them? Is there a list somewhere? The great people at HubSpot have put together a business ideas database. Totally free. If you just click the link in the description below, you can go download a collection of over fifty plus business ideas that are from the archive listed out for you curated

And so, what are you waiting for? Go download it. It's free. Check it out. It's in the description below. Alright. Back to the show. What's your way of filtering for that IQ? Well, you know, how do you interview or what are the signals you look for?

This is, like, super hard. I think you start with, like hard math problems at people. What are you doing? We used to Claring. We had these really hard problems. I remember, my friend, Suji over at Dropbox, some of his partners there at his new his new ventures, Chen Lee. It was, like, the highest score on on this Tesla I gave. It's smart smart, smart guy. I, yeah, we had to do really hard tests. But, you know, once they already had around me, a bunch of people who are really top talent, it's like they knew people. Like, oh, who is the smartest guy in your physics PhD and MIT, who is, you know, things like that. So it's, like, it's, like, you kinda, you kinda get a network that's already really solid, and then you go out from there. And so let's go more on that. So, two things. One, Ben told me something that, like, there's some number. I don't know the exact number twenty, thirty people who have worked at your companies that have then gone on to start, like, unicorn companies. Do what is the what is that number roughly? Oh, gosh. You know, I don't actually the official number, but there's over twenty people who've worked directly for me who've started huge companies. And it's something I'm really proud of is that we've had a lot of super talented people. And, you know, in some ways, it's like, I like to, like, back my mind, like, oh, yeah, I'm a great guy. I take credit for shaping them. But in some ways, it's like, they're already really amazing and and, you know, and and and so I was, like, maybe convincing him to have work with me ahead of time. You know? So it's like there's a nature nurture thing. Right? So let's Yeah. There's and there's some of both. I I do like to think that we've given them useful frameworks just like I learned from Peter, they might have learned some of these things for me too. But, I mean, one one of the one, you know, not all of them I've even backed. Like, some of my backs often went off and they did it themselves and, you know, which, yeah, usually they let me back them. Yeah. Yeah.

That's the worst. When they when you don't you didn't get the call. Actually, I'm still proud. I'm still I'm still proud of. Like, I'll tell you, the the guy who came right out of school to help run out of par with me. And and I and I was, like, he's being president of the company, super talented guy. And, I did not know what I was doing. You know, I just already done balance here. There's mistakes I was making because there's, like, things I didn't realize I had advantages of talents here and, you know, add parts of multi billion dollar company now. It's great, but there's things that took longer, there's mistakes, but there's also obviously good things we did because the company worked out really well. And I think he had he had, like, went off on his own and he had, like, you know, his own tough time or whatever for a while afterwards. And then he ended up partnering with someone started the company, they became worth three billion dollars in, like, four years and he sold it. Wow. Which I'm like, oh, wow. That's pretty fucking cool. So that's what I was like, and you know, I and I and I he didn't have they didn't bring anyone else into that company, but I was proud of the fact that I'd worked with this guy. Right. And then he'd gone on and had, like, crazy success. I mean, it's a cool feeling, you know. But for the record, it's always I'm more proud if I got to invest too. Right now. Take care of your buddies. Exactly. It was most of the, like, like, ninety five percent of them. It's like, people will bring me in, and I'll still, like, help him. We'll coach and work with him So let's do a

big hit number two at a par. Yeah.

You explained, like, explain the layman's terms what even is at a par. And then I wanna I have some questions for it, but let's first do the the explain like I'm five years old. What is Adipar? So Adipar

is, is the leading wealth management technology company in the US. So there's people who work at what are called RAAs, registered investment advisors. There's tens of thousands of these, and they will help you or your parents do whoever kinda manage their wealth. They'll give you reports. They'll do your trust in a state. They'll just do everything around the kind of the wealth planning. Man, it was really freaking hard. We built all this stuff and we like hooked up Schwab and Fidelity because those are like two of the biggest everyone's heard of those. Right? The biggest custodians, and we had all this wrong data in the reports. Like, what are we doing wrong? It turned out that data coming from Shravindale was oftentimes wrong. I'm like, what is wrong with this space? It's like, it's a whole thing's a mess. So it it was it was a hard company to build. It took about three or four years before we really got to the point where was useful to people. And so you didn't give up, though, during that time.

Oh, no. That's, like, the last like, you have to have a personality where you're not gonna give up. I mean, I'll give up if turns out someone else has already solved it perfectly. Like, if Adapar already existed, would have been a stupid thing to do that and I learned that, then then maybe you give up and pivot, but the fact that there's just a hard problem give up. You're just gonna, like, double down and, like, fix it, you know. Interesting. So you're you're,

you you don't give up if it's too hard, too messy. But it's like, that's better. That means once I do solve gonna have this giant moat. Like, Adapar has the biggest freaking moat. We were talking earlier about guys like rocket internet while, like, go around copying things and annoy people. Like, good luck. If you wanna try to copy that, you gotta take a billion dollars in ten years, right. No chance. No chance. You talked about hard work. I had when I was doing research for this, I I called somebody who works on your team. And I said, tell me about it. What's he like? What's it like to work with him? One of the things I said was he's always on. I've never seen him just go, like,

go dark, go off, or just, like, turn his brain off. Be, like, I just wanna chill on the beach and just drink my ties and not do anything. Is that? Well, this is, like, accurate for you. This is, like, my game though. I mean, I think you have to love what you're doing. Right? So, like, you shouldn't play games, you know, you don't like. You know, if you don't play, you don't enjoy the game, you gotta switch it up. Yeah. So this is this is this is this is what I'm doing this because I really enjoy it. It's really fun. I'm really good. I think one of the, you know, Aristotle would talk about how, like, one of the highest pleasures is, like, is, like, using your mind in its highest capacity. Right? So let's, like, you explained, like, you actually enjoy chess more than checkers if you're good at both because chess has more levels to it. It's a more complicated game. And so you you want your mind to be engaged interesting, complex, useful things that are getting things done. It's a it's it's like a positive part. I think it's it's how humanity works. Right. How do you still,

recharge or just clarity of thought. Because one of the challenges is if you're always on,

you might not have that chance to step back and reassess. You do need to open time for I've I've noticed when I overcharged myself, I'm not nearly as creative then. And I'll think of the cold plunge help. Right? That

was a quick in there for a little while. Sixty second. Fifty one second reset we had. I think I stayed in for the phone. Yeah. You you you actually did two plunds. That's pretty good.

What is this typical schedule? Like, what's a day in the life? Because you got your fund, you got companies, you got all kinds of stuff. You got your podcasts. My number one, my number one is ABC, and ABC has a program, which is my favorite part of it. A third of our money now goes towards building new companies. So my favorite thing is, like, the strategy for recruiting talent and and then strategy sessions with with, you know, to figure out what we're gonna build. Right. And so when you you said strategy for talent, what was the other strategy for building the company? Is that Yeah. You're basically

when you're the way I look at the way I look at opportunities for new businesses is you're looking for conceptual gaps in the world. You're saying, like,

here's where this industry is now. Like, here's how this thing is working. Here's how this process is done on the economy, and here's where it could be if it was using, like, the right new technology or the right new incentives or this or this right new effect of cultures or what whatever it is that, like, could be better about it. And the question is not just it it's actually very easy to find conceptual gaps in the world. I'll I'll put forward. If you spend some time with, like, a few smart friends and you, like, studying industry and talk to people, you're like, you usually will find, oh, wow. This thing could be done this way. And so the the harder question is not just what it could be done, but, like, what's the path to get there? What can we put in place that would allow us to get it there? How do we build this thing? Much is it gonna cost? How do we how do we make the people want? So there's a lot of things, for example, on, like, health care and hospitals that are done and completely wrong, but it makes hospitals more money. So so so it's like so even though it's like clearly not the right way of doing things, they're not gonna just fix it. You have to find some way to get from here to there with the actors being willing to do it. Let's do an example. So,

giving the example either maybe something that you're this top of mind because you're thinking about it right now, maybe it's not figured out or a recent one. Yeah. So recent one. Gap and a path that you kinda figured out. Hundred percent. So,

it turns out that there's tens of thousands of loading yards around the country and logistics These are places where trucks come. They get in line. They drop things off. They move things around. They they, you know, pick things up. And it's it's a pretty interesting area. And, like, the biggest warehouse company in the country is prologist. And it turns out the founder's investor with me is based in based in, you know, nearby in California, we're we're back there. And then it turns out there's, like, handful of the biggest carrier companies like rider, you've probably heard of another. So we've actually sold a company to riders who are close to those guys too. And so so because we knew a bunch of these guys, we started analyzing what can we do with AI to make your yards better? And what we figured out is that if you put a just a couple cameras in the first need six. But just a couple cameras, you can kinda watch and map out where everything is, map out how efficient the gate is, map out the processes, create accountability, incentives, people to go faster,

create ways of peeing the carriers if it's backed up to, like, to use the other loading arrows nearby. Just, like, basic little ways on the margins of, like, making these things work better and and and timing on the screen because you want a little bit of competition because you always respond well, you know, if you do it properly. And so we've mapped this out, and we ended up founding a company with a really strong AI team, and and and we ended up kinda co founding it with the this these, like, you know, the warehouse companies, the carriers and others based on their needs. And it's really cool because the way we built it with them have, like, a few hundred million revenue already built in that we can scale up into their into their yards they already own, and then we can have something all the other yards wanna use as well. Let's two more details. So you you're already kind of in adjacent to that world because you've done stuff. But how does the brainstorm work inside your office or wherever, like, where when does somebody ask the question,

Could you use AI for these loading yards? Like, how how did, like, take me all the way to that? Like, where does a question like that even come from? Where does the nugget of insight come from? So my partner, Jake, charge of logistics supply chain. He's he's the kinda biggest driver here, and he's, you know, done some strategy sessions with, you know, our our friends running as different companies. We're close to we'll get together. I I have a vineyard in in Napa Valley and we, like, bring every year, like, the hundred top logistics CEOs and you know, drink and strategize and hang out. You know, it's like a good way. And you kind of are asking them questions to try to find their What are your problems? What works? Are you spending money on? What are you seeing? We'll bring, like, new entrepreneurs and we're backing and, like, get their take on things and we'll bring are called EIRs, entrepreneurs, and residents, you know, who'll talk with them and iterate on the idea. Right. So we kinda knew low loading yards is a big thing. Let's go talk and iterate an idea we could do to apply new things to it. And, you know, in this case, there's a really strong AI team that happens to be in the UK that we'd met through other friends that, like, had worked on some really cool visual problems. We thought very, very good for this and ended up recruiting them as co founders, which which worked out really well. So we're we're constantly on the lookout for, like, separately for you. So, like, map and math, you're like, okay, So if we can improve the loading yards by this, that's the size of the prize, and then that kind of clears a a hurdle for you. Yeah. This is this is this is and and you know the other thing here, which I I don't love, but it's definitely helpful. California had some new regulatory rules about things you had to actually map out as well. So they're gonna have through something anyway, but why not create more value based and then but then, like, be the thing they they put in when they're gonna have to do it anyway the next year. Right. They have the rules coming up. There's, like, you know, logistics has had a few of these things. They had some real automatics where you had to, like, I think for purposes of not making people drive too long, you had to like record things differently, which was kind of an insertion point for a couple of town max companies we held back as well, which is the thing tracks the trucks and stuff. There's things like that where the regulatory thing was helpful too. And then, yeah, you just you sit down, you map it out. You've know you've known people for a long time. I mean, the the one of the unfair secrets of business is the more success you have, the more it's like a platform for a bigger thing you can do next time. And that's just the way it is. You just gotta keep in the game because, like, it's like the I think when I was really young, I used to think, oh, business and make a lot of money and then go to the beach. And then that'd be like fun. And that's, like, that's not nearly as fun as the fact that once you've already started the successful ones, now you get to do, like, bigger things more easily. Right. It's like it's like and and that's why, like, I think when you're young, partner with someone else who already has that unfair advantage, help them use their unfair advantage, build something with them, you have all these extra unfair advantages. You could do it again. So this is this is, like, there's, like, this naive thing where, like, you're, like, this lone business founder. I think, you can do that, but it's so hard. Right. Well, I plan to become a hard Why play game on hard mode? Why not why not fine? And there's so many places in the world where there's unfair advantages. And, like, an unfair advantage, what I mean by that is, like, every time success, you now have the respect and attention and understanding

of all these people who will then help you do the next thing. Right? And and once you prove your competent once, then, you know, there's, you know, I have a bunch more things that could be doing now if I have more competent, like, young people around me who want to be entrepreneurs and partner with me. We have a bunch of them, but we always need more because there's The thing we lack, we don't like ideas. We don't like money. We lack really talented hardworking people with persistence, you know. I love that.

Those so good. Can I come back for seconds? Can we do another example? Another gap or another, origin story of of one of these, ideas that I think is it makes it I'll give you another crazy guy. I mean, these these are these are I'm taking big swings right now. These are gonna sound a little crazy, but, like, I was pretty bullish

on China, like, fifteen years ago. A lot of us were. I'd like I thought it was opening up. A lot of my friends there were, like, reading Milton Freeman and, you know, free economy stuff. I'm like, this is gonna be great. To so many smart people there. So we start making bets there. We start working there. Doing a bunch of stuff. And then this guy, Xi Jinping takes over. And then, like, told by all these different senior people there, like, Joe, yeah, none of the stuff that you wanna work on here is gonna be allowed. It can't be foreign. And they're like, oh, that's too bad. So so I just stopped working there as much. And then I kind of hear from them, like, terrible things are happening, and then a couple of them disappear. Then I hear he's making all his engineers work on defense. I'm like, okay. This is pretty effed up. I'm kinda I'm kinda nervous now. Right. And we started mapping it out. At the same time, you know, we've done pounds here. It started in two thousand three. So this is now, like, two twenty fifteen, twenty sixteen, and I wasn't I'm not running palettes anymore, but I'm still an advisor watching it. And, like, a few of my guys there are noticing that defense the defense world in the US has gotten to be, like, a lot more dysfunctional, a lot more broken. There hasn't really been. So what happened in defense is all these companies consolidate, then nineties after the Cold War spending went down. So they all merged and became, like, these giant primes, and these primes started acting a lot more like government agencies themselves, like, not super nimble, not super adaptive,

kinda, like, the way they get the contracts is by having the right lobbyists, not necessarily.

But and after that, they convince con we call innovation in theater. They have to pretend they're innovating, but they're not necessarily great innovating because that's not because they're so big. They have no competition. And so we're like, oh, this is kinda scary. All this stuff, like, none of the best engineers are going into these primes. They're stuff getting worse. Meanwhile, China has the best engineers. They're getting better. This is we better do something. And so so three of my best ex palletier guys, they partner with Palmer, of course, Start Eundryl. You've talked to him before. So so I backed them early along with Peter.

I'm like, okay, guys. We're back in defense. Let's figure out what the hell else to do here. So we so we basically mapped out, like, what are twenty new possibilities in defense? I wanna I wanna find twenty from just was the most important one. And and and by the way, is that something you tell your team, like, come to the table? I wanna hear twenty ideas. Well, you put you have to have, like, a guy whose job it is. You have to have a guy who's helping him. You have to have, like, advisors who are able to, like, get them into the right places to talk and explore. But let's, yeah, let's talk to our let's talk to our smartest friends in this space. Let's talk to our network. I wanna hear you know, only here, you know, about twenty ideas or new things. Like, and I wanna see where we think gaps might be. And we come back and there's, like, eight or nine pretty good answers and a few things that I thought about but but you know, I find some interesting stuff. And one of the areas that's pretty cool is it looks like there might be new possibilities

in, in in EMP, an electromagnetic

pulse space. It's really directed EMP. Of course, you don't

just wanna set one of these off, and it's it's screw up all your stuff. But what this what an EMP does is it fries electronics. Right? And so turns out that if you can direct these, what it is that you're taking microwave energy and you're shooting it in the blast, you can actually turn things off. And the government has spent billions of dollars on this stuff but they hadn't really applied any of the new, any of the new chips, basically, at all. Do you want that to protect against, like, drones? For example? That's one that's one of the really good ways of doing it. So basically, you can a chip, you can you can basically control power on very small time scales. You could take, you know, take, you know, the guy and I tried emitters, and you could build this correctly with the top child. It turns out there's like co founder who's a friend of a friend of mine from Stanford who's just genius who helped figure a lot of this out also. And and and and you could shoot down things like ten times farther away. And and and you you know theoretically could use this against missiles and turning their guidance systems off, you could use it against a truck coming to your base really fast. You just blast it. You know, it might be that the truck has a terrorist coming to shoot you and you want us to turn it off. Might be there's a pregnant lady. They're trying to get to the base to give birth. Like, you don't wanna necessarily have blown it up. Right? So it's it's by blast getting you're not turning a truck off. You're not killing the person. So pretty cool, like non lethal way of, like, stopping stuff is giving you trouble. Right. And in long story short, we were able to put together a money, put together a prototype,

And, you know, with about with less than thirty million dollars in this in the second round, we got to the point where we were we were we fought our way into a contest against the other primes. And so so, basically, one of the key things in government is, like, always trying to get them to have contests. The primes do not want contest. Like, how do we compete on merit, not on longevity relationship? Gonna be better at playing of the senator. Right. But if you can let me into the contest, then maybe we can win. Right? That's how do you convince them to do the contest? That you push the the the Congress to, like, make laws to a lot of competition. You have there's competent general. There's competent admirals. Like, you know, things to palantir in SpaceX, people had seen outsiders

massively outperforming, and they're they're more open to the ideas. We're pushing things in the right direction. Gotcha. And and so they do this contest and, like, they didn't really take us seriously because the other guys had really spent billions of dollars on this. Like, what can you kids do? Right? That's kinda like the old mindset in the US, the nineteen fifty sixties is, like, innovation is expensive. Outsideers aren't gonna be able to do. And that was true fifty, sixty years ago, but long story short,

we ended up shooting down the hardened drones nine and a half times further away than the than the other guys. They actually had to have they used to have to use binoculars to, like, watch the bus, like, shooting them down really away, and and people were just like flabbergasted. Like, everybody was lined up, and it's like, okay. We'll see who who performs. He's like, you're gonna need binoculars to see ours because it's gonna be out of range compared to whatever else is. I think and and the other people are just totally shocked in in yes. And that's the same in the Paris. Is that the name of the company? Epress. Epress is a cool name. Epress was a name in legend of, the Bow of these DCus started Athens and his bow had infinite arrows. And so this is kinda like a bow with infinite arrows because you can keep firing the pulses. That's cool. There are ten thousand vehicles. If it was a pounder like a

lower the rings reference? Palenciers lower the rings. So Eper Eperis is more is more more real mythology. Palenciers is more of the fake mythology role, but, no, I I have we have quite a few things named after Tokyo and stuff as inspiring story. And I deal with Palantier. Palantier is the seeing crystals. Right? And in the story, this is super dorky, but in the story, they're built by, like, the l's of the outer west. And they're basically this thing created for the humans to get rid of the bad guys, but then two thousand years later, a bad guy takes over the technology. Right. And he's using it for evil. And so the idea of talents here is we thought we're very civil liberties obsessed. We wanted to build it in a way that would, like, go after the bad guys, but but then when you're gonna watch the watchers and be really careful about how the technology is used because it's very obvious if you're doing something kill a bad guys, the bad guy could use this for something Right. And then it's a it is dangerous area. We believed it was a necessary thing to create. And we, you know, we we ended up living thousands of terrorists. So we were we're happy with results. So what's fascinating to me is that not only have you had multiple hits, but they're in areas that are different, but also just hard areas where I don't even Those are not even ideal. I don't think about these, like,

the the logistics yards or E and P pulse technology, like,

these are so in different domains. I'm curious,

is that, is that intentional? Meaning, do you, like, because most of the entrepreneurs around me in Silicon Valley were like, oh, b to b sass. You know, what's a problem? Oh, let's make a to do list app because I know that problem so familiar with it. Is it a strategy for you to go where fish or other people are not fishing, or is that just what happened? No. I think it's definitely definitely a strategy of sorts where you don't wanna build, like, yet another, like, restaurant app or yet another to do this app because it's, like, that's what every other twenty one year old is thinking about. Like, like, it's probably why I miss Stripe early on as we've been in PayPal and I had to, see every payment app. There's, like, literally hundreds of payment apps. And I was, like, oh, god, you know, because it's, like, because Peter would make me take the meetings up if they don't wanna do any So it's like, no, you wanna listen. There's there's parts of the world that are big parts of the economy that are very important that that are not as exposed to technology cultures. You wanna kinda take your our our advantage is we have a really tough technology culture and just figure out how to expose it to something that's that's not likely to to have seen that before and then find ways to work together to fix problems. What are some other ideas? Either,

I wanna either hear ideas that, you're not doing just because you can only do so many things at once, or it might be

That would work. But it's too small for me, or it's it's not like kind of using my my current platform can do bigger things, but this happens to me all the time. I see ideas that somebody could do that. I'm tempted to do because it's so clear to me, but it's, like,

that would be not the right game for me to be playing right now. There's there's so many things if I have the right talent I'd be doing more.

You know, I do a lot in the wealth management world. I think that the process of starting a trust and, like, the actual legal

work this stuff could be very automated with AI. You could have, like, a smart lawyer and, like, a few smart engineers. You could, like, have a whole new trust company and a whole new, state management company. We have we have SaaS software first state stuff you'd plug into and have a lot of distribution for this ready, but I would need, like, the right engineers, the AI people I'm not sure if it's bigger than a billion dollar or two billion dollar business, but it's like it's still worth it, you know, and and it saves a lot of time. So but I'll I'll give you a really big one I wanna do, but I don't have the right people around me.

Local governments. We just sold OpenCO for one point eight billion dollars. And and local government, there's a lot of lessons from this company. A lot of mistakes. So just twelve years, Zach CEO, my co founder did a great job.

We learned that you only can really do things. They already have a budget for us. There's about ninety things local governments

pay money for software to do and open up is about forty of them. So we we learn this pitch really well. Like, this looks like it's a big, right? It's a lot of processes. And and then, anyway, the idea is that there's trillions of dollars spent by local governments,

and a lot of them can't find the right staff for certain processes,

and a lot of them have people retiring soon too. I think I think a BPO, a business process outsourcing thing for certain tasks for local government, that are because augmented by AI could be, like, just a huge business to basically help them with this. And I right now, it's not a standard way they work, but I could see if you do it really well. It could become a standard way. And that's the kind of area where you can make tens of billions of revenue before even notices you because it's such a big part of the economy. So, yeah, that's that's another idea. The first, like, six to twelve months of that company look like? You'd basically have to find early partners willing to trust you and work with you on outsourcing some one of those naughty processes. And it'd be it'd be something like where you, like, augment their ability to do licensing and permitting or or you're augmenting some of their grunt work on tracking their assets and asset management, or you're doing something for their budget for them automatically is way faster. A photo doesn't have to hire three people. They only hire one person, which is you, or something like that. Right. But but you have to go in and figure out what processes are. So these even willing to you do. And it's it's a very unnatural thing because it's not how they work right now, but it's one of those things where there's like a secular trend towards, like, you know, local government not having enough money. So if you can find ways to save them massive amounts of money and make a higher quality service, there could be something there. Right. Alright. I wanna play a little agree or disagree game. So I wanna say a statement. I wanna hear you agree or disagree with it.

So the first one is on on this idea of big swings that solving, like, huge problems, yeah, mission oriented things,

versus, like, getting just getting your first win, under your belt. A guy came on the podcast, and he said, My theory is you first you go get your nut and then you work on your noble mission. And he's like, you know, you go and you develop your skills, you get make a few million bucks, you get personal autonomy,

and then you should pick a noble mission, a noble quest, and go on that. Agree or disagree with that philosophy.

I agree. In general, I think it's a really good thing to do. You wanna have a solid base before you do something. That's like a huge, crazy risky quest. You don't wanna be, like, poor for twelve years while you're while you're doing something. If you I mean, I'm not saying that's gonna be the path for everyone, but if you can do what he said, that's a really great way to do it. Okay. Another one. A lot of people say that ideas are cheap, ideas are a dime a dozen, execute is everything. And I agree that execution is very important, but

I think ideas really matter too. I think that project selection picking the right market to go after

is a, is is a huge lever. So I think that the execution is everything, philosophy is BS. Agree or disagree.

That's a tough one because

I've seen a lot of good ideas with the with the they're actually aren't worth that much because they couldn't actually bring together the talent to do them. So I I I I you you

It's necessary but not sufficient. You do need both. Right. The execution is the harder part, but you're right. You're gonna have amazing execution, and I've seen this and people going after stupidest ideas, and it and it's not gonna yield something. So so so so so you need both, but the ideas by themselves are not that valuable. Okay. That's why I'd say. Another one.

Focus is super power.

And I would say that, like, we were talking about this earlier,

you you recognize the value of focus and just compounding one thing.

But you've also done a variety of things.

Agree or disagree that, you know, focus is the way to go. Focus should be the strategy. Focus is clearly the right strategy for the most successful people in the world. If you look at the wealthiest people in the world, they're nearly all focused and compounded over a very long length of time.

If you look at Palator and add a part of the two companies where I focus full time on them, they're my two of my most important companies. It's

I think when you're having impact on the world in different ways, sometimes it's okay to to do different things. I think I think philanthropically,

I think for me coaching entrepreneurs, something I enjoy.

I think I'm I think I'm obviously creating a lot of value right now, but I think I think as an entrepreneur as a business person in general, it's you you especially if you haven't already had, like, a giant win, you should just focus and get that giant winning compound?

Your friends with Elon, what,

what's something you've learned from him or something you admire about him? Maybe that the rest of us don't know by, you know, when who only known from the outside. Yeah. I

I mean, I guess I'd say I really admire his boldness and his, like, obviously, it's it's he's really good at focus. He's really good at saying no even to friends about anything. It's just not, like, tied to what he's, like, really passionate about and focused on to win. And he's just really, really bold at, like, clearing, like, nonsense out of the way and clearing mess out of the way and just, like, going right for the thing that that matters, right for the substance. So I think I think most people in my life would be, I think I'm maybe too bold or too direct or too extreme, and Elon's like a whole step.

Which I think is great to see. I'm like, okay. I could do better. There's more here. Yeah. I could be I could be more myself in that direction, and and I'd be more successful if I have, you know, I'm obviously done very well, but but but I think he's a whole another level of bold and that's something that it's good to see that for me because it reminds me that that's like a that's a good direction for entrepreneurship.

You know, is he focused though? Cause he's got, like, five things, you know, he's got Twitter. He's got basics. He's got Tesla. He's got neuralink. He's got boring companies. He's got so many things.

Is how do you square that? Is that is it focused or is it I mean, I think he was insanely focused for a very long time on on the things he he was doing and on scaling them. And I guess Yeah. Sure. There were two companies for a very long time after doing one company for a very long time. And,

you know, he's in a level of success again, societally where there's things that really matter for society that only he can do. So it makes sense if he would expand that. I think I told you,

earlier

you know, my partners are allowed to work on up to six things at once. And I think when you're, like, coaching and, like, managing things and stuff, I think that's about the right amount, right amount. I think if you're just operating, you wanna do, like, one or two at most. Right. Yeah.

Last question because I think we gotta go. But what

the whole my whole thing when I come to an interview like this is

what's the one question that really matters? Like, forget the hour. Like, what's the one question that really matters? And all the questions I've asked you've been beating around the bush for this one thing. So now I'm gonna ask you it directly,

which is

you have now created at by my account, at least four billion dollar companies directly, probably more than that. I call that the entrepreneur's

Grand Slam.

You have done something that anybody who wants one successful company would be would be envious of how wow. How does he do it? You know, you see also a lot of other founders. You meet them through your fund or people who probably come up to you. What would you say you are doing different than

the average good founder?

So

it's like I have some unfair advantages. Right? And and and it's it's actually not that hard once you've been really stressful to, like, do it again relative to the first time. But what am I doing differently?

I have a huge town apparatus.

So we have people at, like, dozens of universities. We have all sorts of, you know, things we do. What are some? They have people at university. Who do who? Who? What are they doing? It's like you'll have fellows who apply, and you'll have people who run your program there. You'll host parties and meet talent. You'll you'll have a certain playbook we've built since palantir of knowing how to show up. So you have like a scouting department almost. Yeah. You have like a huge talent scouting department and works in different ways, different places, and and it's really talented people. We spend a lot of time with each of our partners and and and I. That's our job is to scout for talent and to use our network. And the more wins you have with smart people, the more you get to meet their smart friends. And So we have a huge advantage in talent, first of all, because that's really key. We have a huge advantage of, like, knowing that people who run a lot of big industries and, like, having good relationships with them, having them as advisors, having them as being part of things we've done, where we can, like, understand what's happening in those industries, get quick feedback and iterative ideas, like, like, one of the biggest mistakes founders make is they have an idea and they're afraid someone's gonna copy it. They're afraid the idea is valuable. It's it's really dangerous to think that ideas are too valuable because then you just don't share them. You think that they're yours. And so one of our advantages is that is that it would be one of the Peter TL file experiments was imagine there's five founders. Do each have an idea in, like, of them are, like, secretly working on it and, and one of them is, like, talking to everyone and iterating, like, which of the five is gonna win. Right? So it's clearly the guy who's iterating a ton and five five people the same idea. We're able to have that same idea and then, like, iterate faster than anyone else because we know everyone running everything. And and we and we know how to get back have to know how to get to the right answer much, much more quickly. So not only do we have the best talent, but we are able to iterate ideas with people who respect us, with people we involve. And then whenever we start a company,

maybe this is a mistake because I maybe I could've had a lot more money, but I've always been, like, a minority owner of my companies. I've always been, like, someone who might have, like, when we start out the build program, our fund might take twenty percent, and our and when my team and I might take ten percent, so we might have thirty total and, like, maybe thirty five or forty. But but but, like, but we have something where less than half, and we're very generous

with the founders, with the early employees, with the advisors, with the partners. So, like, when we start these things, Like, just even from the beginning, I don't have to wake up in the morning, being the only one worried about this thing. There's, like, there's another thirty smart people waking up who and that's their focus and they're and they're on it. And that's a big advantage to, like, have other people, like, obsess over this thing. And are people who truly feel like co founders, by the way. I think it's one of the big mistakes. You're, like, I'm the founder and you guys are the people working, like, like, Where are you getting from now? Other than your other than your ego? Like, I'd much rather. There's so many companies that people don't even know I'm the founder of and and the people and that's way better because first, they're not gonna harass me about that stuff. And and, like, there's people who are proud founders who get to be out in the press doing it and, and and they're what they're going to sleep worried about because this is their reputation their focus. In the intro, I'm gonna say something like this guy has started more billion dollar companies than anybody in America, which I think is an amazing claim to fame. But forget about a billion. Let's talk about a million. The name of the podcast is my first million. And I went and read a quora answer that you did. Somebody

said, If I wanna make a million dollars, how should I invest my money?

And you said something like this. You said,

I'll pull it up. You go,

If you wanna make a million dollars, it's not about how you invest your money. It's about how you invest your time.

And you said,

it's about how disciplined you are with investing your time. How should somebody who wants to make a million dollars invest their

time?

You know, it's yeah. It's right. Oh, you can't just make a million dollars from investing if you're probably the average person. Maybe you can't like fifty years or something. My grandma passed away at a hundred and three last year, and she was a multi millionaire having grown up in the depression just from saving money and cutting coupons. And that could that could work for a hundred years. Being thrifty. Like, that that is the thing, like, over a very long time horizon. I think you'd said, like, she bought one stock or something also. Like, she's Like, grandfather worked for Abbott, and she held it like, sixty years, it happened to work really well. Great. You know, really good for my for my cousins and their inheritance. But, you know, she was a wonderful lady. But, you know, in general, that's not probably how you wanna make make money. You wanna make money especially these days. I mean, gosh, going back back to that, it was probably a lot harder. But these days, there's so many places with your time. You can learn how to help build things, how to help create things, how to help be useful to other people. And, like, that's what you wanna be doing. You wanna be finding what are you passionate about? What are you good at? You have to figure out what you're good at. There's you have to be willing to say this is what I'm not good at. This is what I'm good And then who else is good at this too? Who I could maybe learn from who I could be like,

spend your time. Try to find a way to help those people. Try a way to learn how their businesses work. Be part of a business and growing it. And that's that's how you see how everything works. And, you know, if you're talented enough, then that the people you succeed with, they're probably gonna be able to help you do something here. And that's what happened to you. Right? That's how you spent your time. My understanding, if we if we walk back in the journey, it's you're in college, you go to Stanford and you,

you end up working at PayPal. You become an intern at PayPal. I I tried a couple times. They rejected me the first time I applied, actually. What happened? Why did they reject a freshman at Stanford, and I remember being at a whiteboard with Max Levchin, and he probably doesn't remember this. He was a co founder with Peter on the tech side, not arguing about some tech thing. Was PayPal already a big deal? Is that why you wanted to work wasn't that much of a big deal yet. Like Peter Tiel wasn't who he was, Elon Musk wasn't who he was. Like those, you know, their companies combined to start it.

But I saw, like, all the smartest people, all these people Meyer and all these kind of iconoclasts going there. Like, people who thought differently, you know. And so you you try one year rejected. Try again the second year you're in. What's your job? You're an intern at PayPal. What are you doing? Oh, it's not very glamorous at all. They basically had me setting up the people's soft instance, which is terrible. But I, you know, I sat next to this guy we were in, like, so roll off who's now, like, our partner, Sequoia, was a CFO, and we were kind of in his domain at first. And I sat next to this guy who was managing all the money on on Bloomberg, like a treasury thing. So I got to learn Amance and Treasury. And then and then what was happening is is the big challenge in the companies were going bankrupt because the Chinese and Russia mafia were stealing all of our money at the time And so I ended up, like, hanging out after work and with these all these guys who were, like, working on how do you stop the bad guys? Because PayPal's like a honeypot. It's got all the money. So, like, you go to seven eleven and the clerk there is like, maybe having a maybe having a bad year and, you know, angry at capitalism. Who knows? And so they're writing down secretly the numbers on their credit cards, and they write down five hundred of these numbers. They can sell them each online for five or ten bucks. Russia mafia is buying them up. Right. And then all of a sudden, you get a charge back that says two hundred dollars, you know, on PayPal to something, and you're like, I didn't do that. So so you so you charge back and then PayPal's left for the bill. Right. And this was, like, costing PayPal several million dollars a month. And a lot of our competitors went bankrupt. And so we got to learn at the time how to base stop the bad guys, which was a kind of fun problems here. And so I like what you did there, which is, one of the pieces of advice I gave in in on the pot is you gotta work on the a plus problem at any company. So regardless of what your role is, you should try to at least know what is the a plus problem? Yeah. It's gonna be helpful. It's the real problem. And then try to be helpful on that. That's, like, because that's the needle mover, and you're gonna get the most learning, the most action. And and I didn't necessarily do this on purpose. I actually wanted to quit at first because the PeopleSoft thing was dumb and so horrible. I couldn't figure it out. And my dad convinced me, don't quit. Just like, do what you can to be helpful otherwise there. So that was a good dad advice. Yeah.

You,

I almost quit college for the same reason. And my dad was, like, because I was, like, you know, I'm pretty mediocre here. I was, like, I'm used to being good. Then you go to a, like, you go to a top school. You didn't feel like you were on Now I'm just these were all the best high school kids. Now I'm kind of in the middle. So I was like, you know, miss too expensive. Maybe I shouldn't be here. He's like, that's exactly what you should be challenge. You wanna be surrounded by people who are better than you. So one of the things Alex Carrp had an insight on my cofounder talents here, who was really good. Is you can't really appreciate a talent unless you're within two standard deviations of it. So you so you think of talent as being an abnormal curve for any typical, typical skill, it could be for math. Could be for podcasts or whatever it is. And, like, so that you just kinda have a natural level of talent. You could shift slightly. And so the very best people in the world at something might be fourth or fifth standard deviation, but if you yourself are second or third standard deviation, you can at least start to appreciate that. Whereas if if if let's say you're not great at physics, I don't know. If you meet, like, Albert Einstein assigned versus a top professor. You're gonna have no idea which one's Einstein. Right? So it's the same thing in any other area, but if you red differentiate. Exactly. But once you can recognize that talent, that lets you then it for things you're building and doing. So it so it actually is very useful to be very good at something even if you're not the best. Right. Okay. Because you can notice what that because you can understand. This is actually the five standard deviation talent I was good enough at computer science. Like, I got able to get a plus as a Stanford. I had friends who were way smarter than making computer science, but I was good enough to know who those kids were and how to harness them and how to hire them. Right? So there's things like that. That's interesting. So now you the next thing you do, you go and you start palantir, which yeah. Well, actually, I worked for Peter's family office for a while. He was the first investor in Facebook. I was just his family office. There's tons of crazy shit going on. It was really fun. It was, like, you know, a really expensive restaurant that went bankrupt. There was, like, a spam company song was starting. There is there's all sorts of crazy shit. And I was there and, like, Peter's a genius, but he's not really a manager. So I started, I said, you know, okay. I'll just I'll take charge here. So I started hiring people with him and and kinda helping him run things. And some of the older guys, like, who the fuck is this twenty one year old kid? End up working on a project that summer to map out, like, what if we've taken all this stuff? We did at PayPal, French, and we and we generalized it to, like, for the intelligence community, what that look like? And and my roommate Stephan and I from Stanford to the site were, like, sketching up all these cool products and we're building prototypes. And that was kind of the the genesis of Palants here. Oh, interesting. Okay. So you guys you basically had the PayPal

showed you a bit of a bit of the problem. It's, like, at least, it's, like, showed us a solution to a problem. They're, like, wait a second. Is because, basically, what happened is, like, that's when all these guys at PayPal. They're in the secret service and FBI. Those are the two groups that are in charge to answer fraud of, like, arresting the mafia guys and these guys would come to us and ask us for advice on other things because it was, like, you know, it's kinda fun. It's cops and robbers. Like, every I don't have every young man likes this, but, you know, tell her, of course. You wanna help get some bad guys. They're, like, So, like, we were teaching them about cyber fraud or whatever you call Internet fraud in two thousand two thousand one, and they start coming to us. And then nine eleven happened, and then the government started spending billions of dollars on, like, supposed solutions to catching bad guys, watching what's going on. And and we knew these guys, and we watched what they were spending money on. And we were like, oh my god, this is stupid. Like, this is way behind Silicon Valley, not that, like, I'm so smart, but Silicon Valley itself had gotten way ahead just because it brought talent from all over the world. So whatever was being done in what we call, like, the the the Beltway, basically, in DC with the old integrators, they're still doing stuff from twenty years ago. And we're like, oh my gosh, this is like our nation's under attack.

And we're wasting billions of dollars on stupid shit. So that's that's when we said, okay. What let's get together. Let's draw up, like, what we could actually be doing here what happens next. So, like, walk us through because to okay. We see today.

It's a I think it I looked this morning. It's a fifty billion dollar market cap company.

That's amazing,

but it's also twenty years later. So if we rewind the clock to where most of the people who are gonna listen to this are, early stage, trying to figure things out, unclear which pathway to go, unclear if this is even gonna work. Take me back to that. What what did you do to what was it like and how'd you figure out, like, the first few steps? Well, there's lots of different ways to build successful companies. Right? So I don't I don't ever wanna be like, this is the path. But our path was we were kinda watching all these companies come out of PayPal. So I was very lucky to be seeing seeing, like, these guys, you know, doing iron port and, like, Dan and YouTube and Yelp and etcetera. So, like, watching these and the ones that I could tell were more successful

that it was we were obviously at the time were the ones that are attracting the very best engineers. It's almost like engineers were lined up trying to get into these companies. Right? So you you think of, like, a lot of times people have a business idea and you're like, how do I hire an engineer? And, like, And, like, it's the opposite. It's like the ones who are crushing it. It's like a night club where the engineers wish they could follow those people in, and we're and and and there's those culture, something about them. It's just the whole It was just so dynamic. It was, like, they were able to try ten times as much really quickly. You can just kinda tell, like, wow. Like, you can be really smart at business. But, like, if you could try, like, ten times as many things, like, you can be, like, slightly less smart business and still succeed, right, because you could iterate. So so, like, okay. We need to build somehow a really top engineering culture. Like, that was, like, one of our core principles early on is how do we we used to say the engineering is king? Like, how do you how do you have a culture that that attracts the very, very best and and respects them and, like, makes them partially in charge of the company, you know, with with you. And so we spend a lot of time on that. It's a little bit chicken and I obviously, I was lucky to have a bunch of my friends from growing up who are national math and chess champions, all these smart guys. And, like, so we bring this really core culture together. Convince some of these really top PhDs for MIT? What would you pitch to them? Like, what's what was the quick version that was getting them excited?

It's

because you need a magnet, something to bring the talent in. The government spending

tens of billions of dollars in this area. They're way behind what we figured out how to do in Silicon Valley. It's clear there's going to be,

a multibillion dollar company that solves this problem, and they describe the problem to us as a very hard technical thing. If we have the best engineers, we're gonna be able to do it, and and we're iterating closely, you know, with national intelligence, with defense agencies, and and you get to go and solve this problem. And if you succeed, we're gonna say thousands of lives, and and we're gonna protect celebrities. That was that was that was a high level. It's like, you know, it's it's a fun big mission. One of those things you said is we're working closely with these agencies, like how easy was to work with them because, you know, you're young. How do they even take you seriously? You're young and you're different. Right? You have a different approach. Yeah. So so is that maybe it wasn't entirely the case that they're as closely as as I'd like them to be with us for the first year or two. So Alex Karp was very good at this. Alex was Alex was the first assistant advisor

to us helping us and then and then And then Peter, kept trying to, like, get us to hire a CEO because Stephanie and I were twenty one, and you couldn't really have a twenty one year old running something working with, like, senators and the defense department. But, like, these guys, these generals or former round roles would come in, and they just did not understand tech culture. And I'm sure they were great guys. They just wouldn't have fit at all with us. And so finally,

Alice Carpenter had been, like, helping Peter raise money for things, their friends from law school. And, you know, he was, he was at and philosophy

in Germany.

And in in Europe, a lot of the billionaires like to pretend they're philosophers is like the high status thing to do. Kinda like you're a bunch of their podcasters or something on ours. I don't know. But but so, basically,

basically, like, he knew all these wealthy people and so he started advising us how to talk to them, how to meet them, how to think about how institutions worked. And he had all these, like, casting things in terms of, like, how you had to approach people to take you seriously, which What do you mean by that? I I don't understand. Like,

if we show up and we're, like,

these, like, quirky twenty one year olds in Silicon Valley, that's, like, that's, like, that's the wrong casting. Whereas if you show up, and you hit walk in the door with you, the former head of the CIA, and and and Peter Teels made the intro after the being a PayPal and another one of his friends who senior has, like, has explained to them that this is a project that they're helping and that it's gonna help in this way based on this big advancement in Silicon Valley and they've been and that they've already been talking to much people at the FBI and etcetera, and they want feedback. Like, that's like a that's like a high status way to come in the room. Right. Whereas if I come in the room, be like, look how smarty and look how right this is, this is better than what you're doing. Like, look smart it is. Like, you're wearing a hoodie. Yeah. Exactly. They're like they're like yeah.

I guess I get a lot of young people maybe underestimate

the substance is important, but it's you can't lead with substance because substance is not taken seriously. So you have to have the substance to win, but you have to have all the traffic of why they're taking it seriously and why they're comfortable doing it and why they're what, you know, why it makes sense. So so anyway, there's these things like this about how the railroad works and and who to talk to them in the who to get your help. So Alex has had this wisdom about, like, people in institutions and how to navigate that, like, the rest of us, we have the best tech culture. We didn't have that. And so actually convinced him to pretend to be CEO for a few years so that so that Peter would stop trying to hire, like, a really, like, senior, like, military guy. But then he was such a good CEO, then he actually actually was. She's still CEO twenty years later. Right. So it was it worked out. And you mentioned Peter Peter was not active day to day necessarily. Nobody was critical for the company. What was he doing?

Peter was like, first of all, he's financial support, then all would give us crazy kids. Like, I told you, there's all these crazy projects going on. Like, a lot of people around him were like, this is the craziest thing you're doing. Like, it's one thing to waste money on a restaurant. You're sending these kids that were trying to be spies and build things until, like, what are you thinking? There's no such thing as a company that does this. So so, like, you have to give them credit for, like, being willing to bat on a crazy idea. You put a lot of money into Like, it was it was several million dollars early on which to the point which is like and and then and then we had any of these funds started putting things alongside others. Mean, yeah, that's, like, that's a huge amount of money for, like, crazy kids is what are we doing? And and and and and then, like, Peter was really good for strategy. He was really keen on one of the most important things is you stopped us from a couple early partnerships. This is one thing that people screw up a lot with startups. A lot of startups when you're getting going, you wanna, like, you get really excited about some partnership on the table, and you think it's gonna really help you. But but a lot of partnerships will cap your upside. A lot of partnerships will limit your ability to iterate and to try other things. And I think because he had the experience and he was going for multi billion dollar win, he was really able to, like, steer us away from a a lot of big mistakes, Julia. Like, what would have been a a partnership that would have been maybe Well, we would have, like, spent, like, all of our time selling our interface in in Europe to give them all the rights to it and we would have to fly over and support things they were doing. It's just like random things that, like, sounded really good because when you're getting going, you're desperate for that first five hundred thousand million revenue and stuff. I'm like, but you have to make sure you get it in a way gonna actually scale them to something much bigger. That's not like a mess that's gonna distract you. Right. Right.

And,

Peter is, he's an interesting guy for sure. He you said restaurant curious, like I mean, there's everything. I think so this is this is, like, not unique to Peter, by the way. This is a really common rule is that whenever someone becomes very successful,

for the first time.

They usually become more expansive if they're an entrepreneur. I mean, all of us, we like to build things, or we like to create things. And so as once you have success, you're like, okay, I'm really good at that. Probably be really good at these six things as well. And then I think we all forget, okay, the reason I was really good at this first thing is because I was, like, obsessively working on it for eighty or ninety hours a week. And I brought, like, thirty of my smartest friends into it, and we all iterated, like, crazy. And we almost died multiple times. And we barely made it work, but kinda forget that. You gotta forget that part. And you're just like, oh, yeah. Oh, I this. And you so you do all these things. Like, it's not my fingers. Exactly. Like, when you're doing this, this, this, this is, like, it's, like, playing wrist, you know, where you're talking and, like, it turns out that's not that's not a good way, but this is what I've seen almost everyone go through this. Like, unless I I'm lucky to watch multiple other friends go through it. So I I still made the mistake in different ways, but you but so so there was very expansive, and there were some things that maybe didn't make as much sense. And and then then of course, but then you don't be so freaking smart. This time of them did make a lot of sense. He wrote the first check-in to Facebook at that time. So, I mean, give me a break. You know, you can you can, I mean, everyone in venture not gonna have a hundred percent hit rate? And so so so you you learn from your mistakes. Were you around when he wrote that check-in to Facebook? Yeah. I mean, I I get no credit for And, like, at the time, did it seem like a big dealer? Was it just, like, one of many things he was doing? It was unclear that that was a that that was fun. It was one of many things. They seemed particularly smart and interesting. And you know, I was I I can't say I thought it was gonna be it's because it was not thing anyone realized that, but but it was it was clear they're really smart, really interesting guys who are very aggressive and so it was it was a fun thing to be exposed. So I think one of my good friends who actually helped Peter write the check is played in the movie by by an African American guy. I think what she jokes about, but it's like, it was a good it was a good time to be there. It was fun. He's like a five white guy. I think it's a little Jewish guy. It's

like, that's also a compliment. I'm so sorry, James. No credit for you. If anyone out there wants to rewrite me as, like, a super handsome black

I would love that. That's exactly. Thank you for doing this. Awesome. Thanks for giving me the highest compliment, which is I learned a lot today. That's what my goal with all these is what are some of the things that, you know,

couple of golden nuggets, that that that come out of this. So thank you so much for doing awesome. It's fun to get to know you.