Berkeley Method of Entrepreneurship Fundamentals: Ben Horowitz

Video Statistics and Information

Video
Captions Word Cloud
Reddit Comments
Captions
(upbeat music) - My great pleasure to kick off this spring's Newton series by introducing tonight's speaker Ben Horowitz. Who's gonna be in conversation with our very own Mike Franklin who's the Siebel Professor of Computer Science and Director of the AMP Lab here at Berkeley. Ben was born in London but he grew up right here in Berkeley. Although he doesn't live here anymore he's a, I understand a frequent visitor to the East Bay and in particular a diehard Raiders fan. (audience cheering) Least until they moved to Las Vegas. (audience laughing) From Berkeley, Ben went out to study computer science at Maya Mamata, Columbia University in New York, and then got his master's degree at UCLA, and after graduation there, he began to work at Netscape where he made the now infamous connection with Marc Andreessen. At Netscape, he established himself as a coach and as a business guru, co-writing a paper that I think at least some of you have seen called "Good Product Manager/Bad Product Manager". After Netscape was sold to AOL, Ben and Marc along with In Sik Rhee who's out at Berkeley alum and Sangati Center advisory board member went on to found LoudCloud, an enterprise software company. The company survived near death, successfully turned around as Opsware and sold to HP for 1.7 billion in 2007. After that Ben and Mark launched Andreessen Horowitz two years later. As a managing partner, Ben was key in introducing the VC firms new business model, coaching entrepreneurs to become CEOs. Ben continues to share the lessons he's learned along the way via his blog that I'm sure many of you seen, via his recent book, "The Hard Thing About Hard Things" and at various forums here on campus, including last year's CS commencement and of course this forum tonight. So please join me in giving a warm welcome to Ben Horowitz and Mike Franklin. (audience clapping) - Well, great, Ben, thanks for coming to visit us here in your hometown. So prior to this event, the students were asked to submit questions that they had for you, which makes my job a lot easier. And one thing I did is I tried to categorize them into a few different topics. So there were a lot of questions about life lessons, things that people can learn from your life given this- - All the mistakes you've made. - All the mistakes you've made. In fact, people ask a lot of questions about failure and how you dealt with it. I'm not sure if that had anything to do with you in particular? - I wrote a whole book about that. - Yeah, I think they read your book. A lot of questions about advice for budding entrepreneurs, because we have several of them in the audience. A lot of people had questions about this mysterious thing called the venture capital business. And so there's some questions there. And then a lot of questions about where you see technology going, where you see markets going. - Great. - So I'll try to do a survey of some of those different topics, and then towards the end of the event will open up the floor for any questions that I missed. - All right, great. - All right, great. So let's start with life lessons. So you went to Berkeley High School and has already been pointed out was- - Yellow Jackets, I said Yellow Jackets. - A big Raiders fan which we could have another discussion about that. But I think it'd be good for everyone to hear a little bit about your story of sort of how you went from Berkeley High School through where you got to today. - Sure, (indistinct) the whole story. - All right, fine you wanna go. We only got an hour or so. - So I graduated from Berkeley High, and you have to imagine growing up in Berkeley and then leaving Berkeley 'cause a lot of you probably came to Berkeley and you're, "Wow, this place is weird." And that was just kind of how life was growing up and then when I went to school in New York, it was shocking. I would just say extremely shocking going to New York in the 80s. And as an undergraduate, probably the most challenging thing that you have is you really wanna fit in particularly if you go to a college, like I did where I didn't have any friends going there, I was just showing up and you're, "Oh, you're gonna show up at a new city and you don't know anybody and you're from a weird hippie kind of town." And so I show up there and I really wanna make friends, but as that I get into it, like, you have to be careful because your friends in college are kinda stupid. - Depends on the college. - And I'll tell you what I mean. For they (indistinct) what you should do with your life, literally say it that way. And that's kind of probably my most important life lesson at Columbia was learning to think for myself. And I kind of ran into it because in those days computer science was kind of not... Like now it's a cool major. Like people think, "Oh, that's a good idea. You're going into computer science. Or you're even taking a computer science, that's smart." But back then, and I think it's 'cause we misname the field 'cause people thought computer science was kind of automotive engineering. Like that's what it sounded to people back then. And when I started to take these classes in computer science, I was like, wow, this is really interesting. And I hadn't even declared my major yet and I take this class, the class about the kind of theoretical machines, the push-down of terminal and some of you guys are computer science majors and you learn about Alan Turing and you're like, wow, this guy did this proof and he proved that if you make a computer that's Turing Complete then you can compute anything. And that means that, there's gonna be one machine that is the machine that does everything. And you gotta remember,, this is 1984. And at that time there wasn't one machine, there were, we had typewriters, calculators, cameras, television sets, like we had machine for everything. Like everything you could possibly think of, we had a machine for it. Like it was just even though Alan Turing is 40 years before then, I'm reading about this guy, wow, this guy has a secret that's gonna happen to the world that nobody knows about but me, like, that's awesome I'm gonna major in computer science. And I was so fired up. And then I go kind of back to my dorm room and I tell my kind of become suite-mates, you're not roommates, but you're in the suite together. I'm like, "Hey, I'm gonna major in computer science." And they were, "Wow, you're an idiot." It was like, "You can go to Devry and they'll teach you how to fix computers, program computers do maintenance on them. Like, why would you major in that? You don't have to go, you go to Devry, you don't have to go to Columbia for that." And I was, "Wow, you guys are idiots." But that was when I kind of learned that even though I really wanted them to me, 'cause they were my friends, I wasn't gonna listen to them. And that little lesson is kind of the key to everything else that I think happened to me in my life. Because every time you have a breakthrough idea, like a really innovative idea, by definition, it's gonna look a stupid idea because if it looked a good idea, guess what? It wouldn't be innovative. It wont to be something that nobody else thought of. It would be something that everybody else already knew and was obvious. And so if you have an idea, "Like I've got an idea to build a company." You tell somebody and they go, "Wow, that's a great idea." You should find a different idea. Because if they can see it right then, if they can see it that without you really explaining the secret or the knowledge, the special thing that you've learned that got you to that idea, then then it's probably a problem. And one of my favorite quotes is Steve Kay said who was the old kind of founder of AOL, which was an important company at one point. But he said, "You know he difference between a vision and a hallucination." And I'm, "What Steve?" He says, "They call it a vision when other people can see it." And and that is really so true. Like a lot of times you all figure something out and nobody else will be able to see it and they will all think you're hallucinating. And that was probably kind of the big breakthrough for me. And so from there, I just kinda did what I thought was smart and I got an internship at this company, Silicon Graphics, and I went there and I was, wow, everybody here is the smartest person I've met. Like I'm definitely gonna live in Silicon Valley and I'm definitely gonna build these like awesome machines that were making the Terminator on. And so I did that and a lot of my friends were, "Oh, you should sell insurance me." And I was- - Go to wall street. - That was it, go to Wall Street, sell insurance, be a stockbroker, like being an investment broker. I was, "You guys are stupid like I work on the Terminator. You're selling bonds." - Now, when you say working in the Terminator, you don't actually mean the terminator, you mean the movie, "The Terminator" not actually building terminators. - So yeah, I should explain that. - Just to clarify. - In the 80s, when I was at Silicon Graphics. So Silicon graphics was kind of a company that invented modern computer graphics. And one of the first applications was kind of rendering kind of the original kind of CGI stuff in the movies. And one of the first really awesome movies was "Terminator One" which was done all on Silicon Graphics computers. And that was really great. And as my career went on, I was at Lotus and I first saw this thing Mosaic which was quite eyeopening because we were working on a product called Notes and it had taken years and years and years and years to build Lotus Notes. And what Lotus Notes had done in the most kind of complex way imaginable, like Mosaic was doing, and proprietary, Mosaic was doing all of that but in a completely open and totally simple way. And I was, "Oh my God, that's the future." I'm in the past, I've got to go. And so I kind of applied for a job at a company called Netscape where the founder who's my friend, Mark Andreessen, the guy who built Mosaic was, and I got to meet Marc. And that was really interesting because... I swear to this day, the reason that Marc invented the browser was because in days there just wasn't enough for him to read. Because this guy is seriously the fastest reader you've ever seen in your life. Like, I'll go on a plane ride with him and he'll read six books. Like in one leg. I'm like, "What are you doing? You're turning the pages faster than I could turn the pages and you're reading." So that's definitely why he invented the browser. And I think all great inventions like serve the needs of the inventor a little bit. And so that one definitely spiritually serve that need. The other kind of interesting thing about Marc is he's a super fast typist. So when we founded LoudCloud together, the admins we're taking the typing test and they were kind of racing each other and my admin type, 73 words a minute, his admin type, 75 words a minute. And I was, "Marc why don't you take the test?" And then there also mistakes. So there'll be in one of my three mistakes that are two mistakes. And then I'm, "Mark, would I take the test?" He takes a test, 147 words a minute, one mistake. He says, "That wasn't a mistake, there's a grammatical error in the test I corrected." So he was very impressive in that way. He's got other issues though. - All right, maybe we should just go straight there. We'll come back to Marc's issues. So also on your resume, you have a master's degree. So at what point in your career did you decide that that was the right thing to do? - I actually got my masters right out of coming out of undergraduate and it was interesting. So at Columbia, what happened was actually a... Funny story, public and private universities. So at Columbia, I studied computer science, but the computer science I studied at Columbia turned out to be just very theoretical at the time. We brought everything in Pascal, a programming language called Pascal which nobody in any company used at the time. And we learned a lot of theoretical stuff, but we didn't get a chance to do that much practical stuff. And then the computers that we had, which is very important kind of to the whole thing was the DEC... We were running, they called them the DEC 20 operating system, which also was getting to be a more obscure operating system. And so when I went to Silicon Graphics and we were on Unix and I was programming and C, stuff was just really different. And I felt I was quite a bit under prepared to be an engineer there. And so that, well, okay. I got another story about that. So I'm a summer intern at Silicon Graphics and I'm working on, at that time, we're billing the first parallel machine. So prior to the late 80s, every computer was one processor, like multi-core, just one processor. And so the operating system itself, there's one play, you just time slice between the processor. There was no contention, there was no semaphores and those kinds of things. And so we were taking the Silicon Graphics operating system and making it multiprocessor ready. So we had to put semaphores on the kernel and whatnot, and my job is to basically break the operating system 'cause I don't know how to program. So, that's a good job for me. So I would write, they were just write programs, exercise the device drivers break stuff. And so it'd be break and 'cause kernel panic. And so I'd get a kernel panic and it would dump out. When the kernel panics, you don't have any tools. So you just got a hexadecimal dump of what was in memory and I'd have this thing I'd be looking at. And I was like, how are we supposed to figure out what went wrong? So I'd take it to my boss. His name was Chris Wagner, we used to call them black Wagner 'cause he killed bugs dead black Flag the roach spray. And I'd take it to Chris and he goes, "Oh." He's looking at the heck stop. "Oh, that address there, that's got a value in it. That should be a pointer. Like if somebody stomped on the pointer, that's what's wrong." And I was, you memorized every line of the memory of the operating system. Like what's running? He's, "Yeah." And I was, man, I am so under prepared. So that's what caused me to go to UCLA to get my master's degree. And UCLA did a actually quite a good job of preparing me to be an engineer. It was, I would say a much better computer science curriculum than than Columbia and I got to meet Professor Kleinrock who some of you invented the internet, basically not Al Gore but... He actually did the math that proved that packet switching would work which you can almost think of it a little Alan Turing proving that the general purpose computer would work. So people had an idea, "Oh yeah, maybe packet switching would work." And you'd have a philosophical conversation about it, but nobody actually worked on those kinds of networks. And in fact, AT&T which was the most powerful company in the world, like was completely run on this kind of command and control network where you'd allocate all the bandwidth for a conversation and then you allocate the circuit and then you talk over the circuit and then you shut down the circuit and that's how it worked. And so you could never build something that's scaled the internet or that was distributed control the internet until Professor Kleinrock figured it out. And so it was great to be there with him. And that was why I got a masters. I'm giving you the long answers. - No, that's good, you keep making my job easy. So I have a question for the audience before we go on. How many of you know what famous company is now headquartered in Silicon Graphics old headquarters? Does anyone know? Not that many. Yeah, so if you have ever heard of the Googleplex, that is the old SGI headquarters which is pretty interesting. - Beautiful buildings. So same buildings. Thank God McCracken though interior designed a lot of those buildings. - So one of the questions that the students asked were things that you had learned in college that helped you in your career. And I heard sort of two main messages coming through. One was sort of having your eye out for the future and trying to have a clear view of what's coming next. And the other seems to be having a realistic understanding of what you don't know and what you don't know. And trying to fix those things that you don't know. - Yeah, that's actually a really good point. So the other thing that's very hard when you're young and actually gets hard as you get older too is like honesty. And that's honesty with other people and honesty with yourself. And I know it's funny to say that. It's, "Oh, so you have to work to be honest, you're not a naturally honest person." And the truth is, there's not a naturally honest person in the world. Like that just doesn't exist. People all pretend they're honest. And if you think about it if you go, "Am I honest?" You'll go, "Yeah, I'm honest." And then I go, "Okay, who else do you know that's completely honest?" Pretty hard to come up with somebody, isn't it? 'Cause nobody really is. It's something that you have to work at. And the reason you have to work at it is kind of it goes back to you really want kind of to feel good about yourself and you really want people to you, and the way to get people to you is you tell them what they wanna hear, not the truth. You tell them what they wanna hear. And that's just not honest. And that's kind of the biggest challenge that you run into if you wanna lead an organization or go do something important is you can't lie to other people and you can't lie to yourself. Or if you do, like they see through, you might think you're being slick, but they see through it. like if you run a big organization and you're just lying all the time, people will go, "Okay, yeah,." I was gonna drop a name, but I know we're videoing this. I don't wanna make an enemy. But kind of the people that I'm talking about. And so you should just know now that telling the truth is work and when you're tempted to say the thing that people wanna hear or say the thing that makes yourself feel better, you need to check yourself and try to be honest. And if you learn to do that, that's an amazing skill. You will definitely separate yourself. - Cool, all right. We'll continue the story a little later, but let's take a break and go in a couple of different directions. A lot of the questions that people submitted had to do with sort of, what you were able to learn by making mistakes? So there was lot of questions, like, what was the biggest mistake you made? What was the most valuable learning experience? People are basically just trying to feel better about things they've screwed up. Did you make any mistakes? I read your book. I think there might've been a few in there. - Yeah, all mistakes. We used to have a model, all new mistakes, that's the key to life, all new mistakes. Like if you try not to make mistakes, you're not gonna accomplish anything important. I mean, like that's just a fact. And I think that that's actually one of the things that is a challenge with school, because in school there's a huge reward for getting all the answers right, and so you do kind of train yourself to want to not make mistakes, but that's actually a bad skill psychologically in life. And we see it in entrepreneurs, like in CEOs always joke with each other. You need to be a really good D student to be a good CEO 'cause... And it sounds funny, but the truth to it is that if you build a company, the mean on the test is not 70 or 75. Like nobody gets a 70. The mean on the test is 16. And so if you feel bad that you're only getting one out of five things right, you're making a mistake because that's good for starting a company and the tons of things that you don't know how to do and all the things that you have to do, but you wanna be able to go quickly and make mistakes and learn from them and correct. I made so many mistakes. It's just ridiculous. I mean, it's totally, I'll tell you about one mistake that I made that I don't even really to talk about. But I made a mistake. So when we started the company. LoudCloud grew very, very fast. The cloud computing company that I started very fast, we bought $27 million nine months after saying, "Hey, we're gonna start a company." we booked $27 million. And that's when $27 million was a lot of money. And we were growing so fast that the fire marshal came and said, "We're gonna shut down the company because you have too many people in this building." So you have to get more real estate. And this is in 1999, we're at the kind of the height of the bubble or early 2000 and... The actual bubble not this bubble which is a semi bubble. That was like a full fledged bubble. My CFO goes, "Okay, we've sound space. what do you think?" And rather than spending 10 minutes like really understanding that, I was just, "Okay, if you found it and you think it's the right thing, let's go." So we leased this space, $30 million, $30 million letter of credit to secure the space. $10 per square foot in 2000. Within six months, the dotcom crash happened and that space was worth 99 cents a square foot. And I had a $30 million commitment to stay in it for 10 years. And that $30 million just haunted me for years and years and years and years. And the whole time, I'm just thinking, Wow, if I had spent 10 minutes, I would have saved myself years of waking up in the middle of night like sweating and going, what the fuck did I do? So that was just one of the mistakes I made, but I made tons of mistakes that. If you try and do something really hard, you're gonna make a lot of mistakes. And entrepreneurship is very much scientific discovery. So if she read about any of the great scientific discoveries, they almost never found what they were looking for. You're going do one thing and then all of a sudden, "Oh, this works for that." You're trying to cure heart disease and your invent or whatever. Maybe that's not a great example. But entrepreneurship is like you rarely end up doing what you set out to do. And by definition, the whole endeavor is a big mistake. Well, I'll give you a really good example. So I invested in this company called Tiny Speck and the company, it was founded by this guy who's really a great guy, he had founded a company called Flicker and you guys still know where flicker is. And flicker actually started out as a massive multiplayer online game that he was trying to build in 2001. And he was, it was him and his wife and they were in Canada and he didn't have the resources to do it. So the avatar uploader thing was all that they really got working well. And so in that was flicker. And so then they sold that company to Yahoo for whatever, $30 million. And so then here, we were 10 years later and he was gonna make the game again, and this game was called Glitch. And so he builds Glitch and I love Glitch. It was a marvelous game. He builds Glitch, but Glitch had two major problems. One is he started it in 2006 and built on flash before Steve jobs clarified war on flash. So it wasn't gonna work on iPhone. And then the other problem was like people would finish the game in two days. And so that's a very good for retention. And so he's at that point and he's got $6 million left and calls me says, "Ben, I've got $6 million left. I have no way to raise money 'cause I've made really no progress because of these issues. It's gonna cost me more than $6 million to finish the game. So I've got three choices. I can pray for rain and try and finish it, I can shut down the company and give you your $6 million back or we built this tool that we use in our engineering team to communicate with each other and make engineering work a little better. And I could, just put that out as a product." And I'm, "What?" I was like, you just build some tool to talk to each other and you want to put that as a product and like you're a consumer guy and you wanna become an enterprise software guy?" It's, "Yeah, I think it'd be a pretty good idea." I was like, "Well, I was, $6 million. It's not gonna make any difference in my life. If you really think it's a good idea and you really wanna do that, go ahead." So he puts the tool out it's called Slack and it grows fastest growing enterprise software company of all times. Big mistake like building Glitch. But these are the things you do. And a lot of the processes, do you have a secret? Do you know something that nobody else knows? And because he was pulling his hair out, like literally smoking eight packs of cigarettes a day trying to get Glitch out the door. He was doing everything to optimize that development and so he learned where software development was suboptimal. He discovered a secret in the process of trying to build the game and it's that secret that led to the company. And that's a really big key is, you have to go do something really hard if you wanna learn something about the world that nobody... It's not that nobody else knows it, but almost nobody else knows it. And nobody else who does know it is acting on it. And that's when you have a breakthrough,. And that's when you have something that you can go build a company around or do something really important around,. But it kind of starts with hard work. And it's funny sometimes I talk to my wife about this, but hard work is super important in life. Like I grew up in Berkeley, I didn't have any money. I played football for the Yellow Jackets. I was just a kid in the neighborhood. And now I have a lot of money. And so with my kids, I'm like, "Okay, now that I'm rich, how do I teach you the value of hard work?" 'Cause that's really the only important lesson that I've got. But for all of you, I think most of you out of public university probably know a little of the value of hard work. Keep that lesson. That's the input, that work is what's important. It's that effort where you learn the secrets that are super valuable and can change people's lives and change the world. - Yeah and also I think the other thing is like you said, trying to do something that's hard, and right before we came over here, Ben was over at the AMPLab meeting a bunch of the students there and basically- - Some of the things were so hard. I was like "You gotta be kidding." - Every time somebody said what they were working on for their research. And Ben is like, "That sounds really hard." And along the way you discover things. Maybe you get to where you're trying to get, but if not, you'll get to someplace interesting, right? - Yeah. - Cool, I think I'm gonna switch gears from the life lessons topic, and if people have more questions towards the end we can go there. So there were a bunch of questions just around venture capital and how you view venture capital and investing. So maybe we'll start off with just sort of your general philosophy for investments. How do you look at opportunities? - It is different than other kinds of investing in the sense that, if you're investing in a restaurant, you're not really banking on a profound invention usually. It's kind of, well, maybe somebody invented a better guacamole or whatever, but at the end of the day it's kind of a pretty contained, understandable problem. You make the restaurant, if your food tastes better than the next guy, and you can get more people into your restaurant or the cool people you can have some cool, Taylor Swift shows up or whatever and then all of everybody goes, "Oh, that's the hot club right there, I wanna go." And that's the restaurant business. So, that's a different kind of investing. If you're investing in breakthrough inventions, then there's not really... Like with Slack... Not only do we not invest in it, but what was the business model, like how it was gonna work? And then another company that actually was one of the founders, Scott Shenker, who some of you probably know a professor here who was one of the founders called a Sierra Networks that I invested in. And today, I think their last quarter, they went to a $600 million run rate. But when I saw them, they didn't have any idea what even what the product was. It was just, we've invented this thing where we can now separate the control plane and the data plane on networks, and this guy, Martin Casado, he worked at the NSA and built networks and he found all the limitations in network. And so he was like, none of the networking technology works for what we need to do here. So he goes to Stanford and gets his PhD and figures it out. And then, he's got this Goo and we're gonna try and make it into a company. Well, what's the product? Well, we don't know yet it could be this, it could be that, it could be whatever. But in that case, like I'm not investing in a business or even really in some ways a product, I'm investing in a secret. So they had a secret that they had earned like not just like a... And people will often when they're pitching me will make up that they have a secret, they're good storytellers. So you kind of have to go through and say, "Well, how did you earn this secret? Like what very hard work did you do to get to that point?" And that's a lot what we're looking for. And some of it, the process of finding the secret, the determination is the same kind of determination that shall need to go on to build a company or do something that. So that's kind of at a very basic level what we invest in. We invest in who we think are special people with the really important secret and the investments that we make that generally do very well. And when we get carried away or get caught up in some trend about how kids are behaving, that's when we lose all our money. So that's generally how venture capital works. So that's the general idea behind it. And then after we invest, then the thing is, you have this inventor, but that inventor hasn't actually built a company, hasn't become a CEO or an entrepreneur. And so how do you... And we have a philosophy that, and I personally have a philosophy that the very best companies are run by the founder inventor. And so if you look at the great technology companies over in history from IBM to Hewlett-Packard, to Oracle, to Microsoft, to Google, to Facebook, they're all run by their founders. But in the kind of history of venture capital, the big skill that the venture capitalists traditionally had was removing the founder and inserting the professional CEO. And so the design of our firm and the big kind of reason why we exist is we want it to build a firm that enabled the inventor to become a CEO. And that sort of, there's really two basic parts to it. One is, are the people who invest in you, are they money guys or are they people have built companies? So everyone who is an investor at our firm has founded and run a company. And so, we know what the process is so we can help the inventor learn the CEO skill set, which is a weird skillset. And then the second part is, professional CEO's have very broad network, which they know executives, they know people in the press to promote the product, they know people in the capital markets to raise money and so forth. So we try and basically simulate that network for the entrepreneur and we've built a kind of very unique looking firm in that we have sort of eight investing partners and then 130 people in the firm and the other 122 are all the network. And every other venture capital firm is primarily investing people. And the reason for that is we want the inventor to have the network of a professional CEO. So that's, and then that was just my experience from being a founder and having my venture capital firms say to me, "Ben, when is your company gonna get a real CEO?" And I'm like, "What am I? (indistinct)." I screwed up the company so bad, nobody would take the job so I ended up being the CEO. - So when a technical founder shows up, maybe a first time entrepreneur, how important is it that they give a credible business plan, got a market strategy, market sizing? Are you guys able to look past that stuff or- - Well, it depends on the stage, it depends on the stage. Like if somebody is coming and they've got an invention and it's profound and they just started the company, then yeah, we would look past that stuff for sure. Although it helps, like it does show... You'd them to have the curiosity to have at least done some of the work to think about how they're gonna go to market. Then the Sierra guys did not really think very hard about it, I have to say. But if they're coming for their third round of funding and they still don't know how they're gonna go to market, that is a problem. And because at some point you do have to build a company or you're gonna go bankrupt and laugh all your employees and be really sad, and have a rally card felt blog post that explains all the... - So there was a really nasty question in the list of questions that I wanna ask. You do a lot of investment in data and analytics and things that. And and the question was, do you use data and analytics in making investment decisions? - We do... And that's not a nasty question. There's different limitations. So there's some things that we can do pretty strong analytics on like there there'll be categories that come up. Like, there's social networking is a thing for awhile where there's a lot of important new companies and you can look at, well, you can say, okay what's the viral coefficient which is kind of how fast does the product spread on its own organically? You can look at and you can compare things like not just monthly actives and weekly actives, but how many people use it five days out of seven during the week and on weekends and how many use it two days out of seven and so forth. And you can do that in a category like that, but the interesting thing is by the time you really get your model, is there gonna be, I'll ask you guys, is there gonna be another social networking company now? Like our Snapchat it, like is that the last one? Because it's kinda hard now that Facebook is as powerful as it is. And plus you have Snapchat, plus you have Twitter to kind of get enough oxygen to build a whole new social network. And that does tend to be how it goes. somebody comes up with a new category and by the time you can really analyze that category as a venture capitalists, that category is somewhat over. So now, we're on to virtual reality and quantum computing and self-driving cars and social networks, and that's pas say, I can invest in that now. I mean, you'll just lose all your money. You do kind of have that challenge and just generally like what's the last really important mobile application that was built that's just an app after Snapchat? I'm sure it's been awhile but that's what happens. Like you build a platform, there's a wave of applications and then there's gotta be another wave of basic computers, like hardcore computer science, breakthroughs, new platforms, new research, and then there can be another application wave. And for the computer science oriented things, like databricks. We invested in databricks out of the AMPLab. Really interesting company. But there wasn't that much, like we could do analytics on like, how was the open source community growing? But we knew the open source community was growing 'cause everybody was talking about it. I didn't have to even do the analytics to know that. But what he really had to do is go, how much better is this at a technical level than everything else? How how long is it gonna last? Will it take out MapReduce? And then you could look at the numbers in the open source community and whatnot and see how it's going, but that that was a little more secondary. - Yep, that's why I thought it was a nasty question. 'Cause I thought- - That's a good question. It's one of these things where like there's kind of a thing that like if you're a computer scientist, everybody's subject to money ball. We're gonna wipe out all the jobs, just gonna be computers doing them. That's true for lot of jobs. And I think data improves almost any job, even ours for sure. But it's not really enough, there's not that much data to analyze. - Great, we don't have that much time left. I wanna take advantage of- - We can also analyze where people graduated from schools. So the founders, there's a lot of founder analysis stuff going on and some guys are, "Oh, do you think we can get the SAT scores? And what the, those aren't that easy to extract, or the guys who graduate from MIT? Do you guys know about IIT? The Indian Institute of Technology? They all have a number. And if you ask them the number, they'll tell you the number, it's kind of part of the culture, which is interesting. Although I don't find that number is that correlated to how good an entrepreneur they are. - If you ask them somebody else's number, they know that too. - Yeah, so they (indistinct) test. They rank them one through whatever 2,500 or however many people they let in. So I'll go, "I'm number 367." You're, "Wow, that's impressive." It was pretty cool. - All right, cool. As we're getting close to the end of our time here, you see a lot of what's going on in the Valley, a lot of the latest innovations. So I just wanna get your feelings on what industries are you looking at? Where do you see the most potential for innovation for disruption? What are you excited about? - Yeah, we actually just launched a bio fund. And the reason we did is computational biology is getting super interesting in many dimensions. So that's probably the thing that I'm most excited about as a human being. Like if I was 20, I think I'd certainly try to be a bio-hacker because it is... Like the ability to use information science and biology and use computer science techniques to do things, it's just so mind blowing, like everything that you see is just like, "Whoa, Whoa, Whoa." And how incredible... You guys would be horrified if you knew how medicine worked today. So for example, MRI, you guys know what an MRI is where they take a magnetic image of you and so forth. So when you get an MRI and they're looking for a problem, they're looking for a problem. They're looking, they're literally, like a human is looking at the picture and going, "Oh, there's a great dot there." And you're like, "What? Like really? You don't have computer vision machine?" "No, no, not at all." And that feeds back on everything to like, what is the resolution the image have to be? Well, it has to be as good as a technician can see. So, there was just so much room for improvement in every facet of biology right now through a lot of the work that a lot of you guys are doing. So that's super interesting. And do any guys follow up quantum computing? For those of you don't, kind of way to think about it is you've probably read that Moore's Law is starting to run out. And the reason it's running out is kind of we're down to what 12 nanometers or something. And so like as you get to the size of an atom, Newtonian physics stops working and now you're into quantum physics. And you can't get smaller because the computers will break literally because the laws of physics change. How cool is that that we got that small? But it was very cool for me who remembers punch cards and all that. So now there's basically computers using the properties of quantum mechanics, quantum physics. So you're building a quantum, like literally a quantum computer and they have these really outrageous properties, like they're a hundred million times faster than a regular computer, but they don't always get the right answer. And you don't know if they have the right answer. So they're really good for things where false positives don't matter like say cracking encryption, where you can just keep trying. And you go, "Oh, I got the key>' So that's very scary for the world of computing and that if somebody builds a quantum computer that cracks encryption, then basically all security on the internet goes away overnight. So, sorry, that was a hard story, I shouldn't tell you. It's not nice to tell these things to the kids. But there's just an amazing number of really interesting things going on. I think that this is probably, it's one of the greatest times to be entering the world in that in one dimension like human potential is being unlocked. You've got people from all over the world who have access to education and information that never did. People in places Bangladesh and rural parts of China that weren't even part of the connected to the world that are now completely connected. And then you've got these incredible, this platform where everybody's got a supercomputer in their pocket. Like that's bananas. I mean, you guys are, "Ah, we've had that since junior high. What are you talking about?" But that's going on and then quantum computing and computational biology. The world's probably never been this good to enter, particularly as an engineer. So congratulations, awesome. - Great.
Info
Channel: SCET Berkeley
Views: 419
Rating: 5 out of 5
Keywords:
Id: N61LXUT89SE
Channel Id: undefined
Length: 46min 52sec (2812 seconds)
Published: Tue Dec 01 2020
Related Videos
Note
Please note that this website is currently a work in progress! Lots of interesting data and statistics to come.