00:00hi everyone welcome to the a 6 & Z
00:02podcast today's episode features Marc
00:04Andreessen Ben Horowitz and author
00:07Steven B Johnson who's written numerous
00:09magazine articles 11 books so far
00:12including where good ideas come from and
00:14also hosted the PBS series how we got to
00:18incidentally those topics also serve as
00:20themes for this discussion which covers
00:22everything from business relationships
00:24decision-making and conflict resolution
00:26to the history of tech technology change
00:29and what excites Ben and Mark most about
00:31the future the conversation took place
00:33at our annual a6 and Z summit event late
00:35last year which also featured other key
00:37notes such as Adina Friedman Charles
00:39Koch and Ted surround us all of which
00:41you can find in the a6 in the podcast
00:43archive as well as other conversations
00:45with root parot and JJ Abrams who came
00:47on stage right before this conversation
00:51I'm delighted and honored to be here
00:53with you and we've got a lot to cover
00:55and what the kind of architecture for
00:57this conversation is in a sense we're
00:59gonna kind of zoom out we're gonna start
01:00on a more personal level and broaden out
01:03to think a little bit about tech
01:05cultures and inside a given organization
01:06and then start thinking a little bit
01:08more about broader social trends coming
01:10out of technology and looking into the
01:12future a little bit but I wanted to
01:14start with something actually just
01:15listening to your conversation with JJ
01:16who I don't know at all but I'm gonna
01:18call JJ he was talking about that first
01:20kind of literally magical moment going
01:23and seeing Universal Studios and then
01:25getting into magic and how that was so
01:27transformative as an eight-year-old and
01:29occurred to me do you guys have a memory
01:31of something like that with tech at any
01:33point where you really saw something for
01:35me it was late it was hypercard
01:37sophomore year in college where I was
01:38just like oh there is this whole
01:39possibility that I hadn't imagined could
01:42happen on a screen do you have similar
01:44stories it's funny this is an
01:46embarrassing question because I'm
01:47sitting next to mark but you know one of
01:49the ones I remember most vividly was
01:51seeing mosaic because you know four
01:53years in tech there were all these ideas
01:56about like if you were in computer
01:58science about what was possible from all
02:02the things that you ought to be able to
02:04do but you could never actually quite
02:06get them to work and hypercard was like
02:08that in that way but mosaic was really
02:10it like it was all there on it and when
02:12you dental you were like oh my
02:13the whole world is like right there I
02:16can reach the world that's the most
02:18craziest thing ever but I hate to say
02:21that with him sitting here cuz it was a
02:24really striking point because up until
02:26that I'm certainly for me and I think
02:27for a lot of people there was discussion
02:29about hypertext that had been
02:31circulating through different
02:33subcultures but I would say probably 80%
02:35of the press that had received at that
02:37point was strangely enough about
02:39hypertext fiction it was people who are
02:41writing these nonlinear stories and when
02:44you saw mosaic for the first time you're
02:47like oh this isn't some obscure
02:48avant-garde postmodern literary device
02:50this is the future of media I have a
02:53much better answer than that so I
02:55actually just mentioned on stage but
02:56like the early pcs really were the
02:57mystery box the magic box and that
02:59really that just you know the question
03:00courser had me from go so that sense of
03:02potential was a really big deal the
03:04other I swear to God that this is true
03:05Knight Rider who remembers remembers
03:08night or Knight Rider there we go Knight
03:10Rider KITT mm-hmm holy so I was I
03:14forget it was 82 so yeah I was 10 right
03:16and so this show is on and I don't know
03:18it's this guy in the leather jacket and
03:19I don't know he seems cool whatever but
03:21they did this very clever thing the
03:22mystery box thing and then though you
03:24know internet no nothing couldn't find
03:25anything you just saw a few commercials
03:26they did not tell you that the car was
03:28like that special and if you go back and
03:31watch the pilot it's like 45 minutes in
03:34and like it's the whole thing has
03:35happened he's been shot the faces at
03:36reconstructive surgery he's got the new
03:38name he's got the mission he's got the
03:39car he's driving along 45 minutes in the
03:42car talks and like I think I fell out of
03:44the couch like I think I just like
03:46literally I was like the cards right and
03:49then I stammered what that felt like and
03:50then I remember the screens like the
03:52dash on that thing right and it's like
03:53being in the space shuttle and to this
03:55day when I get in a car that you know
03:56the modern cars are like that right
03:57there go up to an excluding the fact
03:59that they talk to you now but you know
04:00they got all the screens and this is
04:01that the - and the Teslin the whole
04:03thing it's still I always still feel
04:04like I'm getting behind that - a kid
04:06that is the best answer
04:08so there's a great thinking about your
04:11the relationship that you guys have it's
04:13a long and during one incredibly
04:15productive one there's a line in the
04:17hard thing about hard things in your
04:18book not to embarrass you mark but I
04:20just wanted to quote it here this is
04:22you're talking about the relationship
04:23and what you said is even after eighteen
04:28almost every day by finding something
04:31wrong in my thinking and I do the same
04:33for him it works so first off is that
04:37true but more than that or you guys
04:41is there something predictably wrong are
04:43you guys wrong and or you finding
04:46yourselves correcting each other in ways
04:47that are kind of are there patterns to
04:49the way in which you disagree do you
04:51tend it err on the side this side
04:53we're mark airs on another side you know
04:56I think it's you know we're close enough
04:58in personality but different enough kind
05:01of in skills that we often see things
05:04from different angles and a lot of it is
05:06mark himself which is like mark always
05:08likes to take the other side of the
05:10argument whatever side like he just
05:11enjoys taking the other side that's his
05:13thing and so you know it just kind of
05:16goes that way I think that the real key
05:19to it is that we somehow get to a level
05:22of trust where we can really go at it in
05:26a way that would for most people you
05:28just go like if you like you can't talk
05:31to me that way like how you know like so
05:33disrespectful it's like you're stepping
05:35on me you're asking me these questions
05:36that hurt my feelings but you know for
05:39us you know it has still like you know
05:41sometimes I get close to that but no I
05:45think the big thing is the thing I
05:47decided at a certain point because we
05:49get asked a version of this question by
05:50the founding teams that we work with or
05:51at or we bring a CEO into a company
05:53helped the founder bring in a CEO and
05:54they're gonna have a partnership that
05:56hopefully work something like this you
05:57know kind of asking how do you make it
05:58work because it is so easy for the
05:59conflict for the emotion to just drive
06:01people apart and so the way I think
06:03about it is it's more important to me
06:05that we have the successful partnership
06:07than it is that I'm right
06:09learn any particular issue and I'm proud
06:11to say that Ben of course is the exact
06:12opposite it's far more important for
06:15everybody right right so it meshes
06:17perfectly right hand in glove
06:19I'm joking yep that was a joke and so we
06:22both will argued all the way out but
06:23each of us will defer to the other at
06:24the end of it if it's an argument it's
06:25over which one which of us is gonna
06:27defer to the other one
06:27with each of us volunteering to do it
06:29say most of the time and that's really
06:32like sometimes the argument will not
06:33resolve but we'll kind of know who knows
06:37more about that thing and will yield in
06:42than super product and on their ongoing
06:44disputes about where the technology
06:46world is heading or their kind of senses
06:48like oh no you think this thing is gonna
06:50be huge but this is the old argument
06:52we've been having for five years it's
06:54we don't believe a lot and disagree and
06:55commit right and so it's important as an
06:57example one version of the question
06:58you're asked is like what if we're
06:59arguing about some startup we've funded
07:00and whether it's yeah we're gonna have
07:02some argument about like that was a
07:03mistake or not or whatever like we
07:04basically I don't think ever had those
07:05arguments and the reason is because we
07:07may argue whether this is true of our
07:09partnership or broadly we may argue
07:10about whether to make the investment but
07:12once we make it we're in yep right and
07:13then at that point it's important that
07:15it's the dynamic right sort of implicit
07:16promise in the team and including
07:18between the two of us is we're all in
07:20this we've all committed and I think
07:21that's really critically important
07:22because that that's how you maintain
07:23that's how you don't have I told you so
07:25and backbiting and talking about people
07:27when they're not in the room and that
07:29gets bad do you all have a I'm actually
07:32in the middle of writing a book about
07:33long-term complex decision-making so I
07:36have my own kind of bias in this
07:38question but do you have when you're
07:40confronting a decision to say for
07:41instance like should we fund this
07:42company or should we fall in this round
07:44or other life decisions do you make do
07:46you find that you have a process for
07:49that decision-making act that you go
07:51through and think about as a series of
07:53stages or is it something that's more
07:55fluid and conversational and intuitive
07:58yes so it's interesting this business is
08:01different than our lasts so running a
08:03company you try to be more structured
08:06and how you do this in some ways in that
08:09speed is really important
08:11so if you're running a company you're
08:13kind of your output is decisions and you
08:16rate it on quality and speed and if you
08:18have to make the trade which you always
08:20have to you generally go towards speed
08:23because you have a lot of decisions to
08:25make and if you don't make them fast
08:27then you freeze the entire organization
08:29in our new business basically quality is
08:32everything and so we'll go around the
08:35fifty thousand times if we have to to
08:37make sure that we've explored every
08:40corner and every crevice of the
08:42discussion and we've not missed
08:43something so I would say in some ways
08:46you know we have a lot of like a
08:48framework in our minds about how we
08:51think of investments in deals and so
08:52forth but we're willing to go in many
08:56where we would never do that in a
08:57company one of the things that I love
08:59investigating and talking to people
09:00about is their kind of creative workflow
09:03and where they find inspiration there's
09:05a lot of research out there that some of
09:07which that I've done in other people
09:09have done about the importance of kind
09:10of diversity of influences in your kind
09:13of worldview leading to more creative
09:14thinking so just curious about your kind
09:17of daily information diet in a sense
09:20beyond the kind of the routine of the
09:22meetings did you help with the founders
09:23and the pitch meetings and so on where
09:26do you find that kind of outside
09:29influence in new ideas so we sort of
09:32cheat in a sense which is we have we see
09:332,000 and startups a year these are you
09:36know by definition and 2,000 of the
09:37smartest people in the world and all the
09:39domains that they're operating in and so
09:40I mean honestly after that it's just
09:42it's hard to pick up like a magazine and
09:43open it with any level of it's like you
09:46know you kind of have this you know
09:47you're kind of seen the stuff you know
09:48months or years before it shows up in
09:50the press and so that's part of it
09:51personally I've been running this year a
09:53big experiment and I've always been a
09:55big reader and sort of information on
09:56before and it just you know buddy's
09:58trying to kind of balance short term
09:59long term you know different kinds of
10:00different time horizons of material
10:02different kinds of material and so I've
10:03been running a big experiment this year
10:05which is I've been trying to do a
10:06barbell I've been trying to polarize it
10:08and so I've stopped completely reading
10:10newspapers magazines basically anything
10:13that has a time horizon basically
10:15greater than let's say 5 minutes - you
10:18know anything basic between 5 minutes in
10:205 years which is to say I basically only
10:22read social media on the one hand and
10:24then only books on the other hand right
10:26and just polarize it and gap it way out
10:28so what's interesting about that is of
10:30course being on social media like that
10:31process you know necessarily you end up
10:33consuming a lot of news and a lot of
10:35what's there notwithstanding the false
10:37reports of the death of the web a lot of
10:39what social media is as links to things
10:40that are interesting right people who
10:42you're following are interested in and
10:43so you know I do end up reading
10:44basically everything well one of the
10:46experiments was does it matter like if
10:47you don't see the home page of the
10:48newspaper do you miss things and it
10:49turns out if you follow the right people
10:51you really don't they surface all the
10:52interesting stuff anyway and you get to
10:54see a lot of stuff that you wouldn't
10:55necessarily see looking at the home page
10:56but the other side honestly you know
10:58your accomplishment over the side of it
10:59just as books you know books that
11:00probably become the great underestimated
11:02source of information relevant to our
11:04daily lives that just gets you know as
11:07there is just such a surplus of kind of
11:08near-term information
11:10and consumption let's just say as the
11:11real world is getting continuously more
11:13interesting in real time you can spend
11:15all day long just following the ins and
11:16outs of what's happened in the political
11:17scene or what's happening in the sports
11:19scene or what's happening in you know
11:20the business world or whatever and so
11:21you can really get you know let's talk
11:22about myself I can get really trapped in
11:24the present and so the ability to at
11:26least have some time to be able to go
11:27back and be able to read things that
11:28were written five or ten or fifty or
11:30hundred years ago that have stood the
11:32test of time in the form of books has
11:33been I think is very valuable it has
11:34been very interesting I mean the book
11:36business is actually quite healthy and
11:37people are reading you know reading
11:39print books there's a kind of return to
11:41print books and and it does feel as if I
11:43think one of the things you don't
11:44realize until you write them
11:46particularly with nonfiction books but
11:47it's true fiction as well that when you
11:48meet someone who's read one of your
11:49books they have been living inside your
11:51mind for 12 hours 20 hours depending how
11:55long the book is and so it is still an
11:57unrivaled way to get complicated ideas
11:59into other people's minds and so it's
12:01been I think a sign of health in the
12:03culture that books are actually thriving
12:05in the midst of all this kind of
12:07minute-by-minute social media but also
12:08by the way as you well know like
12:09audiobooks right I think there's a
12:11renaissance in audiobooks which is just
12:12having the smartphone and now the
12:14wireless you know earpods
12:15makes it so much more convenient for
12:17ready to consume audio content long-form
12:19audio content yeah the podcasts
12:20obviously are a big part of that but
12:21audiobooks in the course of drive time
12:22and wait time and this time and you know
12:24morning time and so forth completely fit
12:26into my life in a way that books didn't
12:28use to I also wanted as you've been
12:29about music and you struck up a little
12:31bit about that in terms of your own kind
12:33of creative view of the world yes well
12:35it's interesting and it's very specific
12:37to hip-hop for me and hip-hop is an
12:39unusual music form in that it's a very
12:41kind of capitalistic form of music which
12:43is completely kind of unheard of in
12:45popular music and that the main theme of
12:48hip-hop if you go through all the great
12:49rappers is like how do you build
12:52something out of nothing
12:53you know how do you compete these kinds
12:55of things as opposed to R&B which was
12:56maybe love songs and like rock and roll
12:58which is more communist but it's perfect
13:01it's a perfect analog to
13:03entrepreneurship it's kind of the exact
13:05kind of motivational soundtrack for
13:07entrepreneurs and that's really how I
13:08started with it because any theme I
13:10wanted to write about like it was a
13:13great way to find inspiration but it led
13:17to if you say I made a contribution to
13:20the management literature it actually
13:23rap music in that the big thing that was
13:27different in my book was that the logic
13:30of management is not very complicated
13:31then you can understand all the
13:32management theory it's just not that
13:34hard but the emotional psychological
13:37complexity of doing it is incredibly
13:41difficult and you know we see tremendous
13:43fallout from brilliant brilliant people
13:44who can never get over that and so the
13:47big challenge for me was like how do you
13:50communicate the emotional part of the
13:53lesson and hip-hop is great for that
13:55because it carries the emotion and it's
13:57all about kind of the capitalism so you
14:01know I wrote a post how do you handle
14:03politics on a company and I went through
14:04look like all the things that cause
14:06politics and the subtle things you know
14:08like how somebody asking for a raise can
14:10do it and how you deal with that
14:11technique and so forth but a lot of it
14:14is the attitude of the manager and so
14:17the rap quote that I used was rick ross
14:19who do you think you're with I'm
14:22the boss and like once you get
14:24that then you know how to do it's good
14:27okay so let's zoom out a little bit now
14:30you were asking JJ Abrams about la is
14:33the kind of epicenter of the movie
14:35business so with all the changes that
14:37we've seen in the tech sector and all
14:39the volatility the one constant really
14:42for half a century has been that the Bay
14:45Area and Silicon Valley have been the
14:48epicenter of the technology world really
14:50without any near rival probably for 50
14:53years I think it probably fair to say
14:55despite the fact that it has gone
14:56through all these different revolutions
14:58and you have big computers and then
14:59personal computers and then the web and
15:01then social media so really two
15:03questions I think why why they are like
15:06what was it about that particular
15:07configuration that routed tech in that
15:10world and do you think we're gonna look
15:13back in 30 or 40 years and it's gonna
15:14have the same concentration yeah so the
15:17Y so the Y is I think it's history right
15:19and so it just the fact that it's been a
15:20network effect right it's been a
15:21snowball rolling down a hill picking up
15:23momentum now 456th actually turns out 50
15:2560 70 80 years a lot of ways it goes
15:27back to the 1920's 1930's it really
15:29defense contractors right Steve Blank
15:31has the whole series of videos called
15:32the secret history of Silicon Valley and
15:34he traces that all the way back almost
15:36fantastic taxes and the point of it is
15:39it's just it's this kind of network
15:40effect that's just kept rolling right
15:41and so it's been this place where it's
15:43just like it's the place where the next
15:44really smart engineer programmer or you
15:47know we could only sales person
15:48marketing person west or contact whoever
15:49they are finance person on the margin
15:52right is more tempted to move to the
15:53valley than many other places which
15:55isn't to say that there aren't many
15:56capable people all over the world is
15:57just on the margin many of the ones who
15:59are super ambitious and over the valley
16:00and of course I'm an example of that and
16:02as a consequence right it's a story of
16:03imports right and so another thing just
16:05to read of people interested Tom wolf
16:07the great novelist journalist wrote a
16:09piece in the 80s in Esquire about
16:11literally Bob Noyce who was the original
16:13CEO of Intel one of the fathers of
16:15Silicon Valley and literally grew up in
16:16Iowa grew up in the Midwest and was the
16:18Silicon Valley import and actually wolf
16:20ascribes a water modern Valley culture
16:22to literally Bob Noyce importing
16:23interestingly Midwestern culture right
16:26including by the way Galit arianism
16:27writes the whole open floor plan saying
16:29stock option ownership everybody owns a
16:31share in the company he traces that
16:33actually back to Midwestern culture and
16:35so it just got established and it
16:37developed this ethic and it's probably
16:38not an accident that it's the frontier
16:39right it's probably not an accident
16:41they're sort of the gold rush happen or
16:42it's just kind of this frontier out the
16:43commit tality it's continued so that's
16:45the good news right the bad news is as I
16:46discussed at JJ like it's just number
16:48one we're just bursting at the seams
16:49like it's just become a hard place to do
16:51business and the number two is there's
16:52great people all over the world and like
16:53why on earth so the joke in the valley
16:55is you know Help Wanted write software
16:57company puts up Silicon Valley software
16:58company puts up a help-wanted ad on the
17:00internet or whatever and says no Help
17:01Wanted you know could software engineer
17:03to work on new collaboration software
17:05tool online collaboration software tool
17:07that will enable people to work together
17:09independent of geography all over the
17:10world on real-time PS must relocate to
17:13San Francisco to apply and so it's this
17:15weird incongruity which is we're
17:16building the technologies that in theory
17:18should let this stuff spread and yet for
17:20some reason in the last 10 20 years it's
17:22actually been concentrating more and
17:23more and so I've come to believe it's a
17:25maybe this is obvious so some people and
17:27I would come to believe it's a human
17:28dynamics question it's a psychology and
17:30sociology question not a technology
17:31question in a lot of ways which is it's
17:33just like how do people best work
17:35together right and it just so happens
17:37that at least for the form of
17:38traditional companies which you just see
17:40over and over again is it's just when
17:42you can get everybody in the same room
17:43physically in the same room right with
17:45the level of say fidelity of
17:47communication interaction where we're
17:48sitting you know it's why by the way
17:49it's why we're all physically
17:50and there are a few successful
17:52distributed companies but there really
17:53aren't very many as a consequence of
17:55that and so my hope is that we're gonna
17:57get there in the next you know let's say
17:59ten or twenty years my hope is that
18:00we're gonna get telepresence right in
18:02the form of video conferencing and
18:04telepresence robots and VR and AR and
18:06all these things to collaboration
18:08software and workgroup software and
18:09slack and github and all these amazing
18:11technologies are building for
18:12collaboration my hope is we're gonna get
18:13it to the point where it just gonna be
18:14obvious that we don't all have to be in
18:15the same place if that happens you could
18:18say it's quote bad for the valley in the
18:20sense of like maybe Silicon Valley's not
18:21Central anymore but it would be so good
18:23for the world for that to be the case
18:24and we would all benefit so much from
18:26that I think it's a very worthwhile
18:27thing to pursue and something I'm very
18:29fired up about how much you think just
18:31to go back to that point about noise in
18:33the early days of Silicon Valley in the
18:34history of it it's everything about this
18:36a little bit as well how much do you
18:38think that the participatory option
18:42granting culture which is very different
18:45there were very few kind of East Coast
18:47firms that were doing that so you had
18:48much more traditional kind of top-down
18:50equity systems and those corporate
18:52entities how much do you think that is
18:55part of the success of Silicon Valley
18:57this is something I think it would be
18:58interesting to go back and look at just
18:59economically so I think it ends up being
19:02very important because of the nature of
19:04technology companies so if you look at
19:06you know there are other kinds of
19:08companies where the people are much more
19:12interchangeable and this kind of gets
19:14into why the network effect is so
19:15important so forth and in like a tech
19:18company there's lots of people who are
19:20extremely valuable and that innovation
19:23as a way to get them there kind of
19:26proper compensation for their
19:28contribution have a great conversation
19:30with market Charles Koch where he talked
19:32about like do you have to be rewarded
19:33for what you contribute to others and
19:35that really is key to any business in
19:37any incentive system and particularly in
19:40technology because there are so many
19:41people in the company who are so
19:43valuable and so fundamentally critical
19:45to the company's success it really is
19:48one of a very few kinds of compensation
19:50systems that would work and certainly
19:52you know a lot of the systems on the
19:54East Coast would never work for tech
19:56companies to be kind of world-class
19:57competitive so it's been six years since
20:01mark you wrote the software eats the
20:04world si I went back and looked at and
20:06reread it almost a great piece it
20:08reminded me of I'm sure a lot of people
20:10have seen this there was a great thing
20:11there was circulating on social media a
20:13couple years ago it was an old kind of
20:15single page flyer for Radio Shack right
20:19from like 1988 or something like that it
20:21was a list of like 30 products at Radio
20:23Shack sold and it was the answering
20:25machine was you know a VCR an alarm
20:27clock like a trs-80 kind of descendant
20:29you know a game consoles from like that
20:31and literally without exception every
20:34single one of them is now an app on your
20:35phone right the whole thing had gotten
20:37swallowed up by software which is of
20:39course of measuring productivity problem
20:41because all those things in aggregate
20:43cost thirty thousand dollars in 1988 now
20:46they're free on a phone but it cost six
20:48hundred dollars which is actually
20:50progress but doesn't sometimes look like
20:51it so obviously I think that that was a
20:53very prescient forecast to make it has
20:57anything kind of surprised you six years
20:59later looking back on it I mean in it
21:01you say the next big stages are health
21:04and education and I'm wondering you know
21:05particularly on those fronts has it
21:07lived up to that kind of promise you saw
21:08back then yeah there's sort of the
21:09overall concept of software swirl but
21:11then there was a specific framework that
21:12I proposed in a piece which is sort of a
21:14weak form of semi strong form in a
21:15strong form of this hypothesis right and
21:17so the weak form was every product that
21:19can write every physical product will
21:21become a software product right and
21:22that's that's exactly the RadioShack
21:24example things go from being physical
21:25products being apps the second the sort
21:28of semi strong version of that was there
21:30for any company that makes a product
21:32that can be turned into software well
21:34itself therefore have to become a
21:36software company right and in fact I was
21:38thinking you could see this like for
21:39example playing out right now in the car
21:40industry right where all the car
21:41companies are spinning up software
21:43efforts they're buying software
21:44companies you're spinning up software
21:45Indy as fast as they possibly can
21:46because they see what's coming with
21:48autonomy and all these other software
21:49advances and then the strong and sort of
21:51audacious / ambitious / arrogant
21:54hubristic version of the thesis is in
21:56any industry as a result of this dynamic
21:58in the long run the winning company in
22:01the industry will be the best software
22:02company right which is a provocative
22:04statement right because in a lot of
22:05these industries and again cars are
22:07great example you have incumbents who
22:09are really good at making cars trying to
22:11become great software companies and then
22:12you have great software companies that
22:13have no idea how to build a car
22:15who are gonna start we're gonna start
22:16making cars right and then you're gonna
22:18have basically right this giant
22:19collision between companies coming from
22:20two totally different backgrounds and so
22:23I think that you're seeing lots of that
22:25first stage that weak stage lots of
22:27products transition you're seeing lots
22:29of companies becoming software companies
22:31I think we're just entering in a lot of
22:32industries we're entering that third
22:33stage where there's very interesting
22:35structural battles forming up giving I
22:37says yeah I think you exactly nailed it
22:39with health care and education right
22:40which is there are these giant sectors
22:42of the economy in which not only is
22:44there no productivity growth like
22:46overall in both health care in education
22:48there is no measured growth there is no
22:50measured results in the application of
22:52technology in those fields and in fact
22:53probably it's negative productivity
22:55growth right like the typical University
22:57has been going backwards in productivity
22:58right you just look at the charts the
22:59number of administrators that they hire
23:00right per student is just skyrocketing
23:02and that is literally negative
23:04technological productivity and so those
23:07industries are extremely enticing to
23:09Silicon Valley because they're so big
23:13healthcare healthcare is a sixth of the
23:14American economy yeah right and left
23:16unchecked it will become a fourth and
23:18then a third and then a half and then
23:202/3 and the 3/4 is like it's just left
23:21unchecked it's just gonna keep growing
23:22and so it's so much money it's so big
23:25it's so important it's very enticing and
23:26the incumbent structure of there's many
23:29smart companies in that industry but the
23:31incumbents structure of a leadership
23:32works is just is wired to go the wrong
23:34direction and so there's this huge
23:36opportunity to insert into it which
23:37obviously we're going after hard yeah
23:39but that's still like super early yeah
23:41an education would it Bend you thoughts
23:43on that front I mean there's this
23:45interesting point we're at where there
23:47seems to be a growing backlash to the
23:50presence of screens particularly in
23:51younger kids school classrooms that it
23:54hasn't lived up to the potential and
23:56maybe the kids already have too much
23:58software in their lives as it is so you
24:01know it's funny or it's it's not funny
24:04it's sad that we've not applied
24:07technology that well and a lot of it has
24:08to do with the kind of structure of the
24:12kind of political regulatory structure
24:14of schools and we have a company Udacity
24:16that's worked hard on this and their
24:18final conclusion was to kind of run
24:20outside of the school system but it's
24:22very powerful I'll tell you a quick
24:23story about that but you know obviously
24:26very obviously if you could have like
24:29any teacher or the best teacher in the
24:31world teaching a math class if students
24:33have to study and then be tested like
24:36when you take a test outside of school
24:39like ever in life like what the health
24:41skill is that does this great like
24:43tremendous anxiety and like give people
24:45complexes but you oughta with technology
24:48you ought to be able to measure how
24:49people are learning every step of the
24:51give them harder problems if they're
24:53going very fast or get them help if
24:55they're going slow and there's a lot of
24:57things that ought to be able to be done
24:59but then they think the more kind of
25:01pressing thing and the thing that you'd
25:03acity really addresses is the four-year
25:05education general education doesn't work
25:09that well in the modern economy because
25:10people are switching careers very very
25:12often every you know two three years
25:14sometimes and you know like four years
25:17and then you never go back to school for
25:19the rest of your life doesn't make any
25:20sense at all because people need to get
25:22retrained jobs get displaced and so what
25:25you dasa t has come up with is this
25:26thing the nanodegree which is two months
25:29three months you can learn to program an
25:32Android phone or build a self-driving
25:33car or learn to do technical marketing
25:36and those degrees are connected right to
25:39the job market so you can roll right in
25:41with a skill and a certificate that says
25:45you understand the material and you're
25:46ready to work and that is a great
25:49innovation and something that we're
25:50really excited about and just quick
25:52story on that so one of the huge
25:55problems we have in this country is
25:56prison and the need for prison reform
25:58because we've got you know 75%
26:00recidivism rate where people who go to
26:03jail and come out go back to jail and
26:04the reason they go back to jails they
26:06can't get jobs and the reason they can't
26:08get jobs is because two things one is
26:11we've outlawed like college in prison
26:13and then two and once they come out
26:16their record follows them wherever they
26:18go so you know I've got a friend who
26:21came out of jail and I said go to
26:23Udacity he goes to Udacity and he's
26:26gumming up on his technical marketing
26:29degree and he's already got job offers
26:30and it's like that's what we need
26:32yeah I think thank you so much that if
26:34school particularly you know high school
26:36I have two kids in high school so I
26:39think about this a lot it's kind of
26:40trapped in this middle zone that does
26:42really work in a sense it's much more
26:43effective to have those kind of nano
26:45skills right where you can actually kind
26:46of apply them or the skills should be
26:49broader right I mean when you read
26:50through again a book like the hard thing
26:53about hard things I just think about how
26:55there are so many skills in there that
26:56no one ever thought to teach me in high
26:59school right I mean my skills about
27:01decision-making skills about kind of
27:02emotional intelligence dealing with you
27:04know difficult decisions my kid actually
27:06Amiens high school to its credit is
27:07doing a kind of a design thinking class
27:09and they're basically learning how to
27:11brainstorm ideas interview a customer
27:13think about different possibilities do
27:15mock-ups and it was like this should be
27:17the default this should not be an
27:19elective this would be the thing you
27:20learn and then if you want to go off and
27:22do advanced chemistry or do advanced
27:24calculus that's fine there are those
27:26types of skills that are just everyone
27:28is gonna have to know on some level but
27:30it's very rare to encounter you'll get
27:31very dated curricula there's no question
27:33I'm a mom the Board of Trustees at
27:35Columbia and there are certainly people
27:37who are gonna go to like an elite school
27:39and become a scholar at PhD and I think
27:42the system works reasonably well for
27:43them but for you know the kind of bulk
27:46of the population who goes to college to
27:48get into the workforce it's really
27:50difficult it's exactly as you say it's
27:52kind of neither here nor there let's
27:54talk a little bit then kind of segwaying
27:56a little bit to the job and automation
27:58question anyway in general I think we
28:01all agree that there has been this
28:02growing and now can reach in crescendo
28:05backlash against big tech in the tech
28:08sector that the last year has
28:11particularly brought to the fore and I
28:13feel it very strongly going back because
28:15I lived part of the time very on part of
28:16time in New York when I'm back in New
28:17York you know nine out of ten kind of
28:20opinion like pieces written in media or
28:23negative pieces so I want to get into
28:27some of the specifics about why that is
28:28happening how you guys feel about it but
28:29how much in general do you and how much
28:33have you found do you find selves taking
28:35that seriously and how much do you feel
28:36that people just don't understand what's
28:38going on here we might give two
28:39different answers yeah so I would first
28:41say there's a huge difference between
28:43what gets written in opinion pieces and
28:46the actual opinions of the public so if
28:48you look at approval ratings of tech
28:50right they're incredibly high like
28:52they're the highest of any industry and
28:55approval raising which is one of the
28:57biggest targets is like 80 yeah who as
28:59Congress is like 20 and the president's
29:01I think 20 and so like the guys at 20 I
29:03was saying the guys at 80 need to be
29:05stopped because everybody hates them so
29:07there is that dynamic and I think it's
29:09very real this is the concept of false
29:11consciousness right the whole problem
29:13with the Communist revolution was a
29:14peasants work signed up for it and so
29:16and the intellectual leaders were like
29:18well but we got to take down the
29:19capitalist everything is I think there's
29:20something else going on that this is a
29:22side effect of and I think it's the rise
29:24in the last several years and in
29:26particular after the 2008 crisis credit
29:29crisis crash I actually think was the
29:30catalyst for a lot of this it's the rise
29:32of zero-sum thinking in both economics
29:34and in politics let's say zero-sum as
29:37opposed to positive summarize which is
29:38this sort of game theory right zero-sum
29:40game is I win you lose and by the way if
29:43I'm winning it must mean that you're
29:44losing because it's zero-sum it's only a
29:45question of how we slice up the pie
29:46right whereas positive sum is we can all
29:48win together it's actually great book
29:50called finite and infinite games that
29:52actually goes through if you go back
29:53historically basically economists
29:55philosophers so far thought the politics
29:57and economics were zero-sum and there
29:59were huge battles over resources and
30:00this was you know colonization all these
30:02other horrible things that happened over
30:03years we fought through mercantilism
30:05trade wars right all these things were
30:07fought based on zero-sum and about you
30:08know 300 years ago Adam Smith and a
30:10whole bunch of other really smart
30:11thinkers figure it out no you can
30:13actually gain from trade if you can
30:14actually interact with more people and
30:16it's good for everybody and politics can
30:18be positive some just because I'm doing
30:19well might mean that you're also gonna
30:21do well because again we're able to
30:22culturally trader able to educate each
30:23other were able to you know contribute
30:24each other's thoughts and we're all able
30:26to succeed and so in the wake of the
30:27credit crisis I think zero-sum thinking
30:28kind of came snapping back and it what's
30:30interesting is you see that on both the
30:32political left and on the right right
30:33the ante attack the blood I stop tends
30:35to come out of the left and Marx
30:36actually was shot through with with
30:37lettuce I'm like that's one of things he
30:38didn't understand was the positive some
30:40nature of productivity growth and tell
30:41you anyway so you get that on the Left
30:42you also get it on the right right and
30:45you get it on the right you get it in
30:46the form of populism right which in the
30:48form of opposition to trade and
30:50opposition to immigration right and so I
30:53just think as a culture as an economy as
30:55a country right now if you think that
30:56the formulation is zero-sum you will
30:58then do things that will cause it to get
31:00worse for example on the right you'll
31:03want trade barriers right and so you'll
31:04want to cut trade under the theory that
31:06that will make your people better in
31:07reality cutting international trade
31:10worse you're dividing up a smaller pie
31:12yeah you're shrinking the economy for
31:13everybody for no reason other than that
31:15you're just mad at other people because
31:16you think it's their fault that you're
31:17not doing well and so it's zero-sum
31:18thinking and then on their left right
31:19now it's this anti-tax sentiment where
31:21like if those tech people are doing well
31:22then somebody else must be you know
31:23suffering somebody else must be eating
31:25it and it's just it's the same sort of
31:27extremely reductionist thinking and of
31:28course the risk is that sentiment builds
31:30that it leads to policies that actually
31:32impair the ability to be able to make
31:34progress make progress in the economy
31:35make progress with productivity growth
31:37make progress with job creation and make
31:38progress with wage creation and so
31:40there's a pretty big risk but this is
31:41all gonna go pretty seriously sideways
31:42for the wrong reason right let's take
31:45the tech backlash argument from a
31:46slightly more may be sympathetic level
31:48which is critiques that have come from
31:50within the tech sector that the original
31:53vision of the web that inspired so much
31:56of us which was going to be this
31:58decentralized platform that was going to
32:00distribute the kind of power of
32:02self-publishing and voice to far more
32:05people and it was gonna kind of topple
32:06this big heavy top-heavy mass media
32:09model that's what inspired a lot of
32:11people to get involved in it in the
32:12first place at the end of that process
32:15we've ended up with you know four or
32:17five companies that in terms of their
32:19command over people's attention probably
32:21are the most powerful companies that
32:23have ever been on this planet and also
32:26some of the greatest concentrations of
32:27wealth so inside the tech sector that
32:30people say Reedy centralize the web and
32:32then we need to look at technologies
32:33that will enable us to have you know a
32:35more even distribution in terms of the
32:38companies in terms of people's attention
32:40and so on it and blockchain is part of
32:42that there's some argument that people
32:43are making along those lines how
32:45sympathetic are you to that side of the
32:47case which does align with some of the
32:49the critiques that big tech is too big
32:51that are coming from people outside the
32:52tech sector yes so there's a technical
32:55argument for a decentralization and then
32:56there's the kind of other thing that
32:58you're getting at which is should there
33:01be some like policy answer to the big
33:05tech companies and I think that you know
33:07you have to be very careful there and
33:09look at specifically what's going on
33:11well are they kind of harming are they
33:14suppressing innovation so do people like
33:17us no longer want to fund anything
33:19because you know Facebook or Amazon will
33:23look at the numbers there's probably
33:25more of startups than they've ever been
33:27and what we're seeing and what we're
33:29funding is like super interesting and
33:32you know for the most part isn't
33:34existentially threatened all the time by
33:36those companies once you introduce
33:39policy the potential side-effects are
33:42you know really scary cronyism
33:46corruption the people who have the best
33:48relationship get the best deal and these
33:50kinds of things and that has knock-on
33:52effects that are very difficult and you
33:54know what if you compare it to the early
33:5690s when Microsoft was super strong that
33:58was really actually a far bigger
34:00suppression of innovation there was way
34:02less venture capital they were far fewer
34:03companies being created but like the
34:06technology took care of it over time and
34:07I think technology is changing at a
34:09faster rate now than it was then
34:11and there's blockchain and there's
34:12quantum computing and there's many
34:14technologies on the horizon that could
34:16rejigger the playing field
34:18you know without a policy intervention
34:19one other question about the blockchain
34:21possibilities you know I've been really
34:23enjoying reading Chris Nixon writing
34:26about this over the last year or two and
34:27there is really an interesting new way
34:31of incentivizing and compensating people
34:35both inside a technical organization
34:38associated with an open protocol early
34:40users of the service where all of those
34:42people are participating and the value
34:44that's created with it and thinking back
34:46to the early stock option participation
34:48of noise you know I wonder whether that
34:50this this suggests maybe that there's a
34:52new model here that might be as
34:55revolutionary as those kind of option
34:57plans were so the good news is the tech
34:59industry has had two models for making
35:00forward progress one has been what you
35:02might call pure capitalism which is
35:03corporations right which is startup C
35:05corporations employees stock options all
35:07the things we take companies public with
35:08that traditional structure and then
35:10there's been this other structure all
35:11the way over on the ideological spectrum
35:13right which is open source right which
35:14is basically a tribe right of developers
35:16that are interested in having something
35:18happen coming together by the way
35:19geographically distributed all over the
35:21world in a lot of cases right and great
35:23examples Linux and the web itself was an
35:24example of this and so forth actually
35:26the Internet is so tcp/ip was an example
35:28of this right or the GNU project at MIT
35:30was an example of this and people
35:31technical people coming together and
35:33volunteering right literally with
35:34metaphors like barn-raising right it's
35:36just like come together and make
35:37sort of breathe life into these projects
35:38without a financial incentive and
35:40generally without you know at least
35:41direct financial rewards so sort of it's
35:44polar opposite of corporation as you can
35:45get blockchain is the first new third
35:49thing and I don't know probably 40 years
35:52right free software open sources like
35:53four years olds the first new structure
35:55in 40 years and it's an interesting one
35:57because it's a hybrid it's got the it's
35:59to your point it has the
36:00decentralization of open-source right
36:01these are protocols these are things
36:03that run internet wide these are things
36:04that are not necessarily developed by a
36:06team of you know hundred people in a
36:07building of the Bay Area they have that
36:09kind of open source characteristic to
36:10them and they are decentralized like
36:12their protocols are inherently
36:13decentralized but they've got capitalism
36:15wired in they've got money wired in
36:18right at the protocol right right into
36:20the protocol right in a way where there
36:21is a direct reward and incentive for the
36:24people who actually create the thing
36:25there's a reward and incentive for the
36:27people who use the thing and then there
36:28was a reward incentive for the so called
36:30miners the people who actually run all
36:31the computers all over the internet and
36:33make these things work and it's just
36:35been so fascinating to watch because
36:36this is one of those kind of moments
36:37where people walk up to this idea and if
36:40they walk up to it from the right
36:41they're like what on earth is this
36:42decentralized hippie like burnt like
36:44what on earth are you people doing if
36:46they walk up from the left they're like
36:47oh my god it's got money in it it must
36:49be evil right it's sort of this weird
36:50you got to kind of wrap your head around
36:51it and so what we see is like it is
36:53fundamentally a third model for
36:54innovation and I will also say this the
36:56thing that we see that I think maybe
36:57other people are missing many of the
37:00smartest programmers and mathematicians
37:02and economists and theorists and systems
37:05builders in the world in photographers
37:08in the world are obsessed with this like
37:10it just magnetically drawn to it not
37:12because of the money or this or that or
37:13the hype or whatever because of the
37:15technical innovation so don't underneath
37:16it's that are making this possible and
37:17what can come out of this and we just
37:19think like that's the most positive sign
37:20you can possibly see we just have about
37:22five minutes left so I want to just
37:23cover a couple of other giant topics
37:25artificial intelligence and the super
37:28intelligence debate can we solve that in
37:30about two minutes can you give me is
37:32this is this a legitimate concern is it
37:34appropriate to be worrying about the
37:36threat from your super intelligence now
37:38oh they're really scary things in
37:40technology I would have that one pretty
37:42low on my list I mean I think that one
37:44like I think it's a little bit of a Miss
37:46you know intelligence is a funny word
37:48right like what is intelligence
37:50it's not one-dimensional and there are a
37:53lot of things that we have considered
37:54intelligence like doing hard math
37:57problems computers are already more
37:58intelligent like playing chess computers
38:00are already more intelligent but there's
38:02a lot of dimensions of intelligence that
38:04computers are nowhere on and AI nobody
38:08is demonstrating anything in AI that
38:10says like it's going to get
38:11comprehensively more intelligent and
38:13certainly nothing along the lines of
38:15free will yet so maybe it'll happen but
38:20of all the things it's a very
38:21theoretical so I think it's a little
38:23overblown I do think I'll so there's a
38:25motivation of technologists too it's a
38:27very kind of it makes you seem very
38:28intelligent when you can talk about the
38:30robots taking over the world so it's a
38:32great thing to talk about the thing that
38:34drives me bananas is is the freaking
38:35physicists and it's like I'm a computer
38:37scientist I don't have like crazy
38:39conspiracy theories about black holes
38:41you know I guess I could you know like I
38:43in theory a black hole could open up
38:45here in this room and swallow us all
38:46like I don't have crazy theories about
38:48dark matter like I'm not worried there's
38:50dark matter in the glass I'm not gonna
38:51go around telling everybody it's gonna
38:52eat me it's just like I don't know why
38:54yeah it's hard to find an AI expert who
38:57goes so yeah this is a big problem well
38:59in fact yeah of course tend to be
39:00worried about the opposite which is
39:01they're like oh expectations are
39:03getting set epochal still trying to get
39:11okay so last question I'd love to hear
39:14what you think looking forward to the
39:16next kind of 20 years what's the thing
39:17that you're most curious to see how it
39:21turns out right where you think named
39:22it's going this way but you really are
39:24just dying to fast-forward 20 years
39:25would be like ah that's what happened
39:26with that like what's the biggest kind
39:27of question mark that you have over the
39:29next say two decades so the thing that
39:32makes my brain melt is this now that we
39:34can program biology so they're kind of
39:36or we're getting to the point where we
39:39can program biology you know the first
39:42step is you know you're one kind of
39:44dimension of that is you know solving
39:46disease you know in a much much better
39:48way you know another aspect of it is
39:51creating better humans and I'm very
39:54fascinated to see how that comes out and
39:57what it ends up meaning and you know
39:58whether it goes horribly wrong or
40:00incredibly right what does that even
40:04better humans and how will like our
40:06humans even suited to like figure that
40:08out so that from a curiosity standpoint
40:10I would say that for me is probably it
40:12yeah the thing I think a lot about is so
40:15through all of recorded history this is
40:17why I just think that a lot of tech rat
40:18assistants are just misguided through
40:20all the recorded history most people
40:22have not been I would say most people
40:25have not been plugged into what we would
40:27consider to be modern systems right so
40:29most people have not been literate most
40:30people have not been healthy most people
40:32have not been fed well enough to be able
40:33to reach Floy health maturity most
40:35people have not been educated and still
40:37aren't right to the level that we
40:38consider modern most people don't have
40:40access to economic opportunity that we
40:42would consider to be you know modern
40:44jobs most people don't have access to
40:46what we considered bad quality health
40:47care most people don't have access to
40:49high quality housing transportation you
40:51just go right down the list of all these
40:53things that we've been lucky enough in
40:54this country to enjoy you know large
40:55percent of the population for a long
40:56time most people in the world have not
40:58had access to those things and I know
41:00that the existing systems existing
41:02education system the existing healthcare
41:04system the existing transportation
41:06system has had you know fifty hundred
41:07two hundred five hundred years to get to
41:10the seven billion people on the planet
41:10it's only gotten to a fret every one of
41:12those systems is like that in a fraction
41:13of the people and now we finally have
41:15the way to get right everybody we get
41:17we're at the point three billion
41:18smartphones on its way to seven billion
41:20on the planet we're gonna be able to
41:22connect everybody we're gonna be able to
41:23get overtime we're gonna be able to get
41:24everybody all the things that I went
41:26through right starting by the way with
41:27education right as sort of a
41:28foundational one and so what is it gonna
41:30mean for the planet when everybody
41:32around the planet all of a sudden starts
41:33to I would say become part of the system
41:36so that we know and understand and we
41:38literally have ten twenty times the
41:39number of people around the planet who
41:40are contributing in all these different
41:42areas and I just don't understand how
41:43people can be possibly pessimistic about
41:45the future knowing that that's the
41:46potential then I think we're gonna see
41:47that I think our kids are gonna see that
41:49and I think that's very exciting yeah
41:50that is okay so we covered Knight Rider
41:52Karl Marx and universal education for
41:55the planet I think we've done our job
41:56thank you guys that was great thank you
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