00:00welcome to the a 16z podcast I'm Michael
00:03Copeland Google eBay even the web itself
00:07in the beginning all of these things
00:09appeared as point products interesting
00:12in their way but small of course in the
00:15end they weren't there is this swallow
00:18the red pill moment that happens Marc
00:20Andreessen says where you realize
00:22something really really big is going to
00:25happen optimization the relentless
00:28improvement of everything is another one
00:31of those ideas but first it's like okay
00:33you can make you know these three
00:34websites little better mobile apps a
00:36little better do this and conversion
00:37rates and so forth and then you realize
00:38wait a minute like you can make
00:40everything a little bit better right
00:41basically everything in the world can be
00:43made better and so everything like
00:45everything every experience consumers
00:47have can be made a little bit better
00:48every experience that people have in the
00:50workplace can be made a little bit
00:51better every experience people have when
00:53they're you know traveling can be made a
00:54little bit better and you make
00:56everything a little bit better kind of
00:57all the time and basically the entire
00:59world gets better in this segment of the
01:01podcast mark joins Optimizely CEO dancer
01:04ocher for a conversation that covers a
01:06huge swath of what's most exciting in
01:09tech today the spread of optimization
01:11tools privacy trends artificial
01:13intelligence virtual reality Bitcoin and
01:16killer robots it's all in there there's
01:20gonna be all kinds of things in the
01:21world 50 years from now that today we
01:23think of as weird and strange that we're
01:24gonna just take for granted and we're
01:25gonna be you know us and our kids and
01:27grandkids are gonna be thrilled that we
01:28have them all that in this segment of
01:30the a 16 z podcast and why Donald
01:33Trump's hair could use some a be testing
01:36dancer Roker gets things going you know
01:39we here are all big believers in
01:42this is opticon and we'd love to hear
01:45you know we'd love to hear from you you
01:48know what do you like about optimization
01:49in particular why you invested in
01:51Optimizely yeah so we invest in
01:53optimizing how long ago not 18 months 24
01:56months yeah yeah about that yeah so
01:58they're really two big reasons for an
02:00Allen as I was i'll bring on brag on Dan
02:02and his colleagues which is that we're
02:04in a people business so we back amazing
02:06people and it makes me people attract
02:08amazing people and so the the the team
02:09that Optimizely is built and in this
02:11event and the enthusiasm you know
02:13here and everything just you know speaks
02:14speaks just you know volumes about about
02:16how exciting I think this company is and
02:19then the other the other part is is is
02:20the idea and we have a sort of theory
02:24there are these ideas you know there are
02:25a lot of is that like seem like really
02:26big ideas at first and then sometimes
02:28they work and sometimes they don't and
02:29then there are these very special ideas
02:31where they kind of start out looking you
02:34know they kind of start looks like a
02:35point product or a point thing and then
02:38there's kind of this swallow the red
02:39pill moment that happens or you kind of
02:42like realize oh my god like something
02:43really really big is going to happen
02:44here and you kind of come out the other
02:46side going like this this is gonna be
02:48one of the really big things and you
02:49know in the history of our industry like
02:51I would say Google was one of those was
02:52one of those where it's like you know at
02:54first it's like a lot of people's
02:55reaction at Google early on was like I
02:56searched the internet like is there
02:57anything on the internet like what am I
02:59gonna get is it all just kept photos and
03:01and then it turns out right now it's
03:03like all the world's information and you
03:05can answer any question anytime for free
03:06email is one of those right at the very
03:09beginning it was like you know Pez
03:11dispensers and beanie babies and it's
03:12like I don't know how many people are
03:13gonna want those things and then it
03:15turned out to be the world marketplace
03:16for everything and and so what we
03:18basically figured out or what we believe
03:20is optimizing it's one of those ideas
03:21and optimization is one of those ideas
03:23which is at first it's like okay you can
03:25make you know these three websites
03:26little better mobile apps a little
03:27better do this and conversion rates and
03:28so forth and then you realize wait a
03:29minute like you can make everything a
03:32little bit better right basically
03:33everything in the world can be made
03:34better and so everything like everything
03:37every experience consumers have can be
03:39made a little bit better every
03:40experience that people have in the
03:41workplace can be made a little bit
03:42better every experience people have when
03:44they're you know traveling can be made a
03:45little bit better and you make
03:47everything a little bit better kind of
03:48all the time and basically the entire
03:50world gets better right and so if you
03:52can you know if you can if you can take
03:53you see you guys see this in your in
03:55your day jobs is you take you know 1% or
03:572% or 3% out of this activity that you
03:59know 10 million people do and like that
04:01turns out to be a lot of time right or
04:03you make the experience a little bit
04:04better here a little bit better there
04:06and then you magnify it out across you
04:07know all these all these users all these
04:09all these clicks all these all these
04:10points of engagement and everything gets
04:12better and so I think this is this is a
04:14company that may have you know kind of
04:15the most leverage maybe of all the
04:16companies who've invested in which is
04:18it's sort of an opportunity make the
04:19whole world better thank you
04:21I I like me said every experience can be
04:25made a little bit better
04:26and we do believe we've built a platform
04:28that can help this group do that for
04:30their customers and today we launched
04:33personalization our second product and
04:34in that there is a obvious transition to
04:39being using more data about an
04:41individual in a way that might be
04:43infringing on some of their privacy and
04:45I'd love to hear your thoughts on how
04:48this group our customers can the same
04:51time give a better experience a little
04:53bit better experience the same time
04:54respect their customers privacy yeah so
04:58privacy is one of those topics that's
04:59become a hot topic in the world and it
05:01kind of I got it that made it kind of
05:02snuck up on me kind of by surprise
05:04because I in the world Midwest I grew up
05:07in rural Wisconsin and I would say in an
05:10environment of almost total privacy
05:11which is like nobody had any idea who I
05:14was and nobody cared and and you know
05:18very little connectivity and you know a
05:19lot of people here are old enough to
05:21remember the days if you know it's like
05:22okay I want to watch TV okay there are
05:23three channels to pick from you know
05:26there's no like micro targeting of like
05:27video content it's like you're gonna
05:28watch it's on ABC that night and so you
05:31know and then you know when you deal
05:32with institutions you're dealing with
05:33the government you're dealing with banks
05:35or something it's this sort of
05:35impersonal interaction where they don't
05:37know much about you and it frankly comes
05:39across because they don't care that much
05:40about you and so you know I've always
05:43just had kind of the default view that
05:44if you if if businesses this business is
05:47a particular know more about their
05:48customers that can provide a better kind
05:49of a better kind of experience and then
05:52you look at these things you know lives
05:53a lot of you know kind of drama around
05:55like you know privacy of your Google
05:57searches or privacy of your of your
05:59Facebook Graph or whatever but as a user
06:00you're it's great right the utility from
06:03making the trade and basically
06:05contributing personal information the
06:07utility you get as a user is just
06:08absolutely enormous absolutely
06:09tremendous and so I think you know the
06:12dominant thing that's happening is the
06:14idea of privacy basically gets redefined
06:15right and it gets redefined from kind of
06:18maybe old ideas that maybe nobody knew
06:20much about anybody to you know new ideas
06:21in which maybe the world become
06:23significantly better because there's
06:25more transparency and so you know I
06:28think this debate is gonna play out like
06:29I don't think there's a single answer to
06:30this I do think that sometimes privacy
06:34advocates kind of stereotype of this
06:36thing is if the world's going to be kind
06:37of abstractly better if there's more
06:38privacy I think in reality there
06:40always privacy utility trade-off and
06:43then I think what happens is younger you
06:45know younger people and you see this and
06:46all the usage data younger people you
06:48have your consumers coming up just have
06:49a different view of privacy right and so
06:51you know of course like everywhere I go
06:53and everything I do I take photos and I
06:54put them on Instagram like to not do
06:56that you know I'd be making myself a
06:57social pariah right why would I choose
06:59to not participate in this you know of
07:02course I'm gonna use Foursquare to be
07:03able to like navigate through as I go
07:04around the city so you know and maybe
07:06you know I want all my friends to be
07:07able to see where I am so that we can
07:08have more meetings when we happen to be
07:10in the same area and so I think there's
07:12a generational thing that's starting to
07:13play out where I think new generations
07:15of people have new expectations of the
07:17benefits of being connected as opposed
07:18to the benefits of being private yeah so
07:20if the younger generation has a
07:22different view of privacy if you had to
07:24forecast five ten years or 20 years down
07:27the line is privacy dead is the concept
07:29of privacy antiquated yeah so I don't
07:31think so my friends you know Scott
07:33McNealy you know like so famously years
07:35ago kind of you know got headlines he
07:37said you know privacy is over
07:38you know privacy is dead get over it I
07:40don't really believe that and I think
07:42you also see this when you when you
07:43spend time with young people which is I
07:45think we just need we need to get people
07:47control and we think we need to get
07:48people control over what they share and
07:49what they don't by the way I think the
07:51flipside of privacy right the flipside
07:53to sort of privacy to things opening up
07:56the flip side is we have these
07:57technologies especially encryption we
08:00have technologies to be able to keep
08:01information safe and secure but arguably
08:03one of the big problems of our time is
08:05that those technologies actually aren't
08:06being used there was actually a this
08:10very fascinating kind of hacked security
08:12breach that happened to the government
08:13about two weeks ago came out it turned
08:15out this this a government agency called
08:16the Office of Personnel Management they
08:18basically have all of the employment
08:19files for all federal government
08:20employees including and this is a scary
08:23part they have all of the federal top
08:25secret clearance background checks which
08:27is basically you know hundreds of pages
08:28for everybody who's ever worked for like
08:30the military or intelligence agency
08:32where they've got like all the dirty
08:33secrets like everything they've never
08:34done in their life that would be
08:35embarrassing they kind of the government
08:37finds out about this as part of the
08:39clearance process and somebody broke
08:42into these servers and you know stole of
08:45the personnel files for four million
08:49the head of the agency testified before
08:50Congress yesterday then was asked you
08:52know why didn't you encrypt all this
08:54information and she said well you need
08:55to understand you know these are 30 year
08:57old computers running COBOL
08:59you know they don't make encryption
09:01software for COBOL like you know the old
09:03systems literally cannot support
09:06whereas with modern computers whether
09:08it's your smartphone or whether it's the
09:09server in your business you can't
09:10actually encrypt everything like you can
09:12actually keep everything under at very
09:14take control and so I think there's
09:15gonna be this I think there's gonna be
09:17sort of opportunities on both sides
09:18opportunities to trade privacy for
09:20convenience and utility but also
09:21opportunities to use technologies like
09:23encryption to be able to take other
09:25things and make them more secure and
09:26more private and so I think that it'll
09:28actually there will be advances
09:29happening on both sides yeah so it
09:31sounds security is a key part of this
09:32question around privacy yeah I think
09:34people just need people need to be in
09:35control people need to be able to make
09:36the decision and make it in a conscious
09:40so another thing I said this morning was
09:43that we believe that our job is to build
09:46a technology that does what it's good at
09:48statistical inference number crunching
09:50the group here this their job is to do
09:53what they're great at it comes down to
09:55basically asking the right questions and
09:57and their creativity so as we think
10:00about that we think of that as a
10:01symbiosis that you know we do what we're
10:03good at they do what they're great at
10:04and that's what turns into great
10:05experiences but if you think further
10:07down the line if you think about the
10:09advances in artificial intelligence is
10:11that is that going to be true forever is
10:13there gonna be a moment where everyone
10:15in this room is replaced by a computer
10:16right including us including yes there
10:19was a venture capital firm in Hong Kong
10:21they got headlines recently they
10:22appointed an artificial intelligence to
10:24their investment committee and so we had
10:26a whole Russia calls from reporters
10:27saying our business plays by robots at
10:31least so far we're okay in case in case
10:33anybody's worried so I think the whole
10:37it's actually really kind of interesting
10:39it's the whole is this whole debate now
10:40around AI and about you know this sort
10:43of prospect in fact some fairly
10:44prominent people including Bill Gates
10:46and Stephen Hawking have been kind of
10:47going out basically saying it's time to
10:49start getting scared of the robots
10:51coming to first take your jobs and then
10:52I guess eat your children and it's sort
10:56of this very dark Chi you know science
10:58fiction movie there's terminator and
10:59it's you know it's you know terminator I
11:01guess you know terminator
11:02former's depending on how old you are
11:05you know it's kind of this very dark
11:06vision of like we're building these
11:07machines and then at some point they're
11:08gonna turn on us and kind of artificial
11:10intelligences at the core of that well
11:13let me start by saying like I don't
11:14actually know like I fund advanced
11:16technology companies for a living I have
11:17not yet found the company that can build
11:19like the killer robot if I did we'd
11:22probably fund it and so I would say
11:26we're frustrated more than anything else
11:27that we could we can't actually find the
11:29people that know how to kill a robot
11:33step three question marks for profit so
11:38I think it's just I frankly think it's a
11:41it's a it's just sort of a broad-based
11:43misunderstanding of the technology what
11:47we do what we all do what we all do here
11:49and and what we all do in Silicon
11:51Valley's we built tools like
11:52fundamentally what we do is we build
11:53tools and we build tools that people use
11:55and you know there was a time and the
11:57tools always are scary when they first
11:59come out right and so like you know the
12:00car there's these really interesting
12:03histories like the car was really scary
12:04when it first came out and in fact there
12:06were the the car was so terrifying when
12:07it first came out people got so freaked
12:09out by the idea like this mechanical
12:10beast you know sort of a mechanical
12:12horse that would be kind of like
12:13rampaging through towns and running
12:14people over because cars at that point
12:15we're going like 15 miles an hour and
12:17that was really fast and so there were
12:19actually these laws passed at the time
12:21it's like 120 years ago now these laws
12:23passed at the time called red flag laws
12:25basically it was the only people who
12:28could have cars or rich people because
12:29you'd be driving your car you'd be up
12:30for a ride and your motor car motor
12:32death car was what they call it and then
12:34you have to have your mechanic in the
12:35front seat with you because the car
12:36would break down every two or three
12:37miles and then you'd have to have a
12:40third person who would walk a hundred
12:42yards in front of the car with a red
12:43flag waving the red flag warning people
12:46that the car was coming in fact another
12:50another part of the panic at that point
12:51around it was in Pennsylvania they
12:53passed a law they were worried that the
12:54cars were gonna traumatize all the
12:55horses and so they passed a law that
12:57said if you were driving along in a car
12:59and you saw force coming you had to get
13:00out of the car disassemble the car and
13:03hide all the parts behind the hero's
13:05bush and then the horse would go by and
13:08then you could put your car back
13:08together and get back on the road so so
13:12these new technologies kind of always
13:13seemed scary and then what you realize
13:16they help people they help people do
13:18their jobs they help people make better
13:19decisions they help people get work done
13:21they help people do things that we're
13:23never possible before and then you start
13:26thinking about all these different
13:27examples and I mean it's obvious if
13:28you're a cop like your best friend if
13:30you're a cop now or you know sort of
13:31working like working the military your
13:33best friend is like the bomb disarming
13:34robot and like what a great idea that
13:36you can like actually send the robot to
13:37disarm the bomb instead of having to do
13:39another example they have what's called
13:41AI sort of neural networks expert
13:44systems that's getting very exciting is
13:45medical diagnosis and so in the medical
13:47profession there's this big debate right
13:49now right doctors have always died you
13:51know doctors diagnosed you go and you
13:52see the doctor and he looks at the scans
13:53and you see and you know they make the
13:55diagnosis there are software systems now
13:58expert systems that through algorithms
14:01can make diagnoses they can analyze the
14:04scans and everything and they can they
14:05can tell you and in all the studies that
14:06have been done in the last like 20 years
14:08the expert systems make better diagnosis
14:10than human doctors and in fact there's
14:12these these tests that they do where
14:13human doctors actually the same doctor
14:15given the same information six months
14:17later will often make a different Magno
14:18psious because this you know humans are
14:20subjective and it's all interpretation
14:22that's all this stuff and so the
14:23question I always asked is if you're
14:25going to go to the doctor right you've
14:26got these opinions about like people are
14:27better than machines and you don't want
14:29AI to do everything you're gonna go to
14:30the doctor and you might have something
14:31serious and you know intellectually that
14:34the machine is gonna do a 30% better job
14:36of diagnosing you're probably gonna want
14:37the machine to do the diagnosis like and
14:40so I think we just we all vote with our
14:41feet on this stuff which is we build
14:43tools tools make life better tools make
14:46people more productive and business
14:47tools make life better for consumers and
14:50I I'm an extreme optimist on this I
14:52think we just make better and better
14:53tools all the time and the tools help us
14:56as humans magnifier abilities they don't
14:59take away from what we can do they help
15:00us do more than we could possibly do
15:02before and I think that's what's been
15:04happening and I think that's what that's
15:05what's gonna continue to happen but but
15:08if I find the killer robot startup I'll
15:09let you know okay all right yeah you
15:13obviously when new technologies come out
15:14they can be scary like the car and
15:16there's often this broad-based
15:18misunderstanding that technology one of
15:19those technologies where that may be
15:21true today is Bitcoin and crypto
15:24currencies more broadly right and
15:26I've heard there's been discussion of it
15:29being similar to the way that the
15:31internet was talked about when it
15:32started and you were there
15:34you started the internet and I wanted to
15:36know if what the world feels like now
15:38with regard to Bitcoin is how it felt
15:40back when you start in that scape and if
15:42you could also help this audience maybe
15:44be a little bit less scared of this
15:46technology yeah so bitcoin is a classic
15:48Bitcoin is a classic example of this and
15:50so the if you read the press about
15:51Bitcoin like the entire thing is a
15:53disaster right so it's it's you know by
15:55definition like it's only for terrorists
15:57or criminals and for bad people and you
15:59know along the way it's going to like
16:01you know make it you know just gonna run
16:02that you basically put the entire
16:03banking system into the ground and it's
16:05gonna like revoke national currencies
16:06and countries are gonna collapse and
16:07it's like it's just all absolutely
16:08horrible and then there's the reality of
16:11what it actually is and so what Bitcoin
16:14actually is is it's a new technology
16:16it's actually very analogous to the
16:17internet it's a new technology that
16:20basically makes it possible for people
16:21to do business online with each other in
16:24an environment lots of hackers and lots
16:26of threats but be able to do business
16:27with each other in a way that
16:29establishes and maintains trust and a
16:32lot of that has to do with a lot of that
16:34it's not just financial transactions
16:35with financial transactions are at the
16:36heart of that right and so how do you
16:38send economic economic value how do you
16:40send money from person to person in a
16:43sort of Internet centric way which is
16:45still a challenge these days and then
16:47for that matter other kinds of digital
16:48assets and so you know digital Keys
16:51digital contracts digital signatures
16:53digital stocks bonds insurance
16:56agreements like all kinds of digital
16:59assets can basically Bitcoin is
17:00basically a platform to be able to
17:01exchange those in a trusted way online
17:03and you know this is an extremely
17:06powerful idea like this this idea is
17:07very powerful the technology is very
17:08powerful and this will be a big deal
17:11what's interesting in the reaction to it
17:13is that the way the way that basically
17:15people think about it in the like in the
17:17US for example is they look and they're
17:19like well why would I use Bitcoin if I
17:20could do like a credit card transaction
17:21like you know with visa or why would I
17:23use Bitcoin instead of using US dollars
17:25because we have this clearance the US
17:26dollars so it works pretty well or why
17:28would I use Bitcoin instead of a bank
17:29you know like like like JP Morgan Chase
17:31and so we kind of compare this new thing
17:33to these things that we already have
17:35what I find interesting about that is
17:36that you know technology now right smart
17:40is getting to everybody in the world and
17:42so and and and so basically you live in
17:45a world where basically a lot of people
17:46now around the world are getting
17:47smartphones before they have even
17:48running water or electricity and all
17:51throughout you know Africa and Southeast
17:52Asia and Latin America in all these
17:53places there's this amazing adoption of
17:55this new technology and in when it comes
17:59to financial services in most of the
18:00world people don't have stable
18:01currencies right if you live in
18:03Argentina or Venezuela you don't have
18:06the same view that you trust your local
18:07currency the way that we trust the
18:08dollar right in fact quite the opposite
18:10you probably have you know
18:11hyperinflation you have capital controls
18:13you probably don't have a payment system
18:15the way that we have working here and
18:18you probably don't have a banking system
18:19that works the way that we do and in
18:21fact the big challenge for a lot of
18:22people around the world is how do they
18:24ever how do they ever store value like
18:26how do they ever actually keep value and
18:27not have it get stolen out from under
18:28them or have it get inflated away from
18:29them or how do they ever do business
18:31without middlemen you know stealing
18:33money in the process there's this great
18:36story in Afghanistan there's a huge
18:38problem with you know the FT and Stannis
18:39trying to tilt up a national police
18:40force and there's this huge problem of
18:43they were you know paying there's no
18:44like modern banking system or like
18:45payment system in Afghanistan and so
18:47they were paying police officers a cache
18:48but the problem was right the cache was
18:50getting embezzled by the commander's
18:51right along the way and so the cops were
18:53only making like half of what they
18:54should make because people were stealing
18:55the money along the way and they started
18:57doing mobile payments to be able to pay
18:59the cops and all of a sudden the cops
19:00were actually giving a hundred percent
19:01of their paycheck for the first time and
19:03so in most of the world we don't have
19:05the kinds of systems you know that we're
19:08used to having here and so there's a
19:10very very big opportunity to use these
19:12new technologies and those include
19:13Bitcoin and those include smartphones to
19:15really up level the capabilities that
19:17people have in many countries and I
19:19think that's a big part of how Bitcoin
19:20will play out yeah well another thing
19:22that may cause some fear in this room is
19:25disruption and you know we're fortunate
19:27to have some of the world's largest
19:29enterprises here and and I think
19:32oftentimes they'll see how fast
19:34industries can transform if you look at
19:37lyft and uber you'll see that happening
19:39to the cab industry and maybe one day
19:40they'll be disrupted by driverless cars
19:43and unless they do that themselves
19:44I'd love to know your perspective on
19:46what you think is going to be disrupted
19:50prediction where jobs are gonna
19:52disappear and which jobs are gonna
19:53flourish yes so disruption has a
19:55branding problem it has this scary name
19:58and the reason it has a scary name is
20:00because the idea of disruption was
20:02invented by this guy clay Christensen
20:03there's a professor at Harvard and so
20:05you know he's a guys comes out with a
20:07new idea and you know if he gave it you
20:08know if he gave it like a bit pedestrian
20:09name like the name I would give it his
20:11creation and I was explained why in a
20:13second but it gives it like a pedestrian
20:14or optimistic sounding name nobody would
20:16have paid attention and so it gives it a
20:17big scary name and everybody gets all
20:18spooked and then pays attention and it
20:20sells a lot of books and gets people to
20:21wrap their heads around it so but as a
20:23consequence like it sounds like you know
20:25disruption it sounds like it must be bad
20:26if you read his book is called the
20:29innovators dilemma where he describes
20:31this which which just remains one of the
20:33best business books ever written if you
20:35read the book what he basically
20:36describes as a very positive process and
20:38the positive process of disruption is
20:41new consumer choice new options
20:45available to consumers that were not
20:47available before and then the sort of
20:49definition is a disruption is a new
20:52choice a new form of product that's
20:54available to customers who previously
20:56never had access to anything like it and
20:58in fact often a product that's cheaper
21:00right and so classic examples of
21:03disruption the personal computer
21:05disrupted the mainframe right once upon
21:07a time you know there were only
21:08thousands of computers of the world then
21:10the personal computer came along and all
21:11of a sudden there are millions of
21:12computers of the world and all of a
21:13sudden instead of a computer costing you
21:15know a million dollars all of a sudden
21:16computer cost a thousand dollars and so
21:18everybody here who has a personal
21:20computer today is a is a beneficiary of
21:21that disruption process the people who
21:24ran the mainframe companies didn't think
21:25this was a good idea they were not in
21:27favor of this but the people who read
21:29the PC companies knew that they were on
21:31the right side because they were giving
21:33consumers something that that we had
21:34never had access to before smartphones
21:37are now disrupting pcs right and so if
21:39you go ask the PC guys what do they
21:40think about smart phones they're not
21:41fans if you ask people if you ask
21:44consumers who have access to smart
21:46phones who never you know smartphone in
21:48the developing world now costs like a
21:49hundred bucks or 50 bucks you know a lot
21:51of people the world are getting the
21:52first computer that they're ever going
21:54to own as a smartphone because they
21:55could never afford a PC so it's the same
21:57thing the smartphone companies are
21:58disrupting the PC companies but in the
22:00process delivering computers to a lot of
22:02people for the first time
22:03and so this is the progress that this is
22:06how we make progress and one of the
22:08things I like to point out is that
22:09basically everything that we have in our
22:11lives that we like and enjoy it's a
22:13product or a service is the result of
22:14disruption right it's like you know
22:16washing machines disrupted you know
22:18people hand washing dishes you know
22:20clothes washer dryers disrupted people
22:22hand washing clothes you know cars
22:24disrupted horses the horse is a
22:26good-news of the horses they never
22:27complained but you know everybody today
22:31who drives a car like there is another
22:32world in which had the card not
22:33disrupted the horse you know we would
22:36you know we would be spending a lot more
22:37time on horses and so everything
22:40positive we have in the world that we
22:41like today is the result of this process
22:42and I think that's I think this process
22:45will continue to play out I think
22:46there's going to be all kinds of things
22:48in the world 50 years from now that
22:49today we think of as weird and strange
22:50that we're gonna just take for granted
22:52and we're gonna be you know us in our
22:53kids and grandkids are gonna be thrilled
22:54that we have them the other thing in the
22:57economics and this gets to the whole
22:59thing on job loss because disruption in
23:00the moment looks like it caused the
23:02strategy to cause those jobs to go away
23:03because the old thing is it's not as
23:05needed anymore and so therefore the
23:06decimals go away the thing that
23:09disruption does that is routinely
23:11happens and it's kind of a surprise
23:12every time is disruption lowers prices
23:15right and so the the economic
23:17consequence of a lower price like if I
23:19used to have to buy $1,000 pay $1,000
23:21for a computer and now I can pay $100
23:22because it's a smart phone what happens
23:24is that frees up all that extra money
23:26right and so you know that frees in that
23:29case in that example it frees up $900
23:31and it's $900 that I would have had to
23:33spend on a PC but now I've saved because
23:36I buy the hundred hour smartphone
23:37instead that $900 still gets spent all
23:40right it doesn't just get like he
23:41doesn't evaporate and it doesn't just
23:43get put in a bank account that money
23:44gets spent and that money gets spent on
23:46new things right and then from a
23:48consumer standpoint you're better off
23:49because now you can afford more things
23:51for the same thousand dollars from an
23:53economy standpoint more jobs get created
23:55by the unleashing of the saved money
23:58then get destroyed by the effects on the
24:01legacy industries which by the way is
24:04why we all are sitting here today with
24:05jobs you know the United States has you
24:08know the United States at 200 years ago
24:10there were a couple million total jobs
24:11the United States today after 200 years
24:13of disruption you know there are 150
24:17the process of economic growth is the
24:19process of money being unlocked to be
24:20able to do new things and actually think
24:22this is a process that's running really
24:24really well right now I think it's
24:26actually running in a very positive way
24:27so let's zoom out from disruption of a
24:31particular industry then talk more
24:32broadly around technological revolutions
24:35and you refer to a great book here by
24:37Carly de Prez the technological
24:40revolutions and financial capital where
24:42she talks about the phases of great
24:46surges in technology essentially and
24:48there's the installation phase in the
24:50deployment period and it's a very
24:52related sort of topic to other whether
24:55we're in a bubble or not which is
24:56probably a common question you get so
24:57I'd love for you to comment on your
24:58perspective on technological revolutions
25:00and and what that means for us today
25:02sure so one of the things that I find is
25:05it's always really hard for any of us to
25:07kind of evaluate the times in which we
25:08live right because it's also heated like
25:10it also feels so intense and so serious
25:12and so so in the moment it's sort of
25:14really understand kind of big picture
25:15changes that are happening I I find it's
25:17very useful to try to understand history
25:18I try to understand how things have
25:20played out in the past and it's not that
25:22the analogies are exact but that you
25:24know there are patterns like people are
25:26people and there are patterns and how
25:27things happen and so the book that Dan's
25:30referring to is probably my favorite
25:31book that I recommend most often and
25:33it's got a kind of a not a lot of people
25:34read it because it's got one of those
25:35titles that kind of scares people off
25:37it's called technological revolutions
25:40and financial capital you know if it
25:41were published today would be called
25:42like zoom or something like that but or
25:47disrupt with an exclamation point but
25:48it's got one of those titles and then
25:51the author is a very interesting woman
25:52for a lot of Perez who's a now famous
25:54economist from Venezuela one of the
25:57reasons I find her interesting is
25:58because if you're a if you're an
25:59economist from Venezuela like you have
26:01really thought about economic issues
26:03kiss Venezuela's not you know fed as
26:05Leila's had issues and so she's
26:07extremely sharp extremely sophisticated
26:09and then the other great thing about
26:11this book is she wrote this book I think
26:14and so the book predates the internet
26:15the modern Internet and so it doesn't
26:17have any kind of flavoring from kind of
26:19our recent events it really is a
26:20historical look and what she does is she
26:23looks back over 200 years of Technology
26:25200 years of technological change and
26:28she looks at the really big things right
26:29so she looks at like steam power
26:30and she looks at the automobile and she
26:32looks at electricity and she looks at
26:34you know radio and television you know
26:36these really really know steel these
26:37really big technological advances from
26:40the past that had huge impacts in their
26:42time railroads another big one like this
26:45and she basically shows this pattern
26:47that emerges over time and so the
26:49pattern kind of works like this which is
26:51big technology shifts our generational
26:53shifts and generational which is to say
26:56like literally like over 25 years and
26:57literally from one generation of people
26:59to the next generation of people and she
27:01says the reason is because basically the
27:04really big technologies affect how
27:05people live and so they challenge all
27:08the assumptions around how everything is
27:09done and often people who are already
27:12adults at the time the new technology
27:13comes out have a hard time wrapping
27:15their heads around what the implications
27:16are gonna be but then kids just consider
27:18it to be obvious right it's just like
27:20you know it's like if any of you have
27:21kids say it's like obviously I'm gonna
27:22spend eight hours a day at minecraft
27:23like why would you not you know and all
27:25the parents are like I don't know what
27:26the hell he's doing and like literally
27:28that apply you see that apply kind of
27:30that kind of effect over and over again
27:31and so it's it's the adoption in
27:33technology's kind of follows this
27:3425-year cycle in the beginning they seem
27:37weird and scary and then 25 years later
27:39they seem completely normal and
27:40integrated at every part of our life
27:41which is why we're all driving cars and
27:44we're we're all you know using
27:45electricity and everything today without
27:46even thinking about it and then what she
27:49does is she compares the rate of
27:50improvement of technology with how
27:53financial markets deal with the change
27:54and what she does basically she shows
27:56it's this s-curve every single time
27:58where it's basically in the beginning of
28:01a new technology there's a huge rush of
28:03enthusiasm for the technology and
28:05everybody gets excited and the stock
28:07and stocks get bid way up for all the
28:09new tech companies but then there's this
28:11disappointment period there's this
28:13crisis there's this disappointment and
28:15the disappointment is basically people
28:16get too excited and so in the
28:19disappointment phase people all of a
28:20sudden realize okay this stuff may be a
28:22big deal someday but it's not ready yet
28:24and so these new things don't actually
28:25work yet and then there's a crash right
28:28and then the crash is very very big and
28:30very traumatizing and you know stocks
28:31crash and companies go bankrupt and all
28:32kinds of horrible things happen and then
28:35you go through this phase where
28:36basically everybody just writes off the
28:37new technology and everybody says it's
28:38not going to matter ever because
28:39everybody is now bitter and disappointed
28:42that's precisely the period in which the
28:44technology actually starts to work right
28:46and then at some point ten years later
28:48the financial markets kind of wake up
28:49they come to kind of come out of their
28:50coma they kind of go oh that thing that
28:52we thought was a complete failure right
28:54actually now it actually works and then
28:56all of a sudden the tech stocks go back
28:57up because people realize that this
28:58stuff is actually going to happen and so
29:00she literally shows that for railroads
29:02and she shows that for electricity if
29:03she shows that for all these things all
29:06of us in the room we hear that story of
29:07course we think come crash right we
29:09think like internet you know bubble in
29:10the 1990s we think that com crash you
29:13know we think the sort of nuclear winter
29:14for tech between kind of 2000 and 2010
29:17when most people thought the internet
29:18was you know was dead and then what's
29:21happening today which is now there's a
29:22generation of companies including the
29:24public companies like Google and
29:25Facebook but also new companies that
29:27people are getting all excited about and
29:29so if you read if you read this book and
29:32you view it through that lens the sort
29:34of claims that were in a bubble today
29:35make total sense people are traumatized
29:38by the fact that the last time it looked
29:40like this stuff was going to work it all
29:41didn't work and it crashed and so we're
29:44all psychically scarred but now this
29:46stuff is actually working right and
29:48consumers actually are on the internet
29:49they're using it all the time ecommerce
29:50is exploding right online media is
29:52exploding all these things are actually
29:53working and now investors are starting
29:55to get excited again but like
29:57reflexively root feel like it can't
29:58possibly be real because it wasn't real
29:59last time and what she would say as it
30:02actually is real this time yeah you and
30:04your firm just published an amazing
30:06report on the history of funding love
30:07for you to soar summarize the findings
30:09for the for the audience yeah so there's
30:10this thing right so the thing is
30:12happening right now out here is there
30:13are these new companies and you know the
30:14headline you know headline name
30:15companies and uber and lyft and Airbnb
30:17and all these new companies and there's
30:19this this new term which were not a huge
30:20fan of it is in Germany unicorn which is
30:23basically a private tech company that is
30:25valued at more than a billion dollars
30:27and so there's this kind of been this
30:30wave of press basically saying there are
30:31all these new tech companies that are
30:33that are not worth more than a billion
30:34dollars as private companies and
30:36basically it must all be a bubble right
30:38these companies must all be hot air it
30:40must this must be 1999 all over again
30:42because last time people got excited
30:43about this kind of thing it didn't end
30:45well and so people are getting excited
30:47again and it's not gonna end well
30:48and so there must be a bubble and in
30:50particular when people point to is you
30:53know you have these companies they're
30:54not public companies so it gets like
30:56company Google's a public company
30:57everybody can see their financials and
30:59you can decide what they're worth or
31:00what they're not worth but like their
31:01stocks and they trade you know like
31:03public stocks whereas all these private
31:05companies uber I mean you hear reports
31:07about what their numbers are but like
31:08who really knows and these investors who
31:10are investing in them like me must be
31:11stupid because why would you ever think
31:13these companies are gonna be worth
31:14anything and so that leads to this kind
31:17of perception that there must be a
31:17bubble we put out a deck that you can
31:21find on on our website on our website a
31:2216z com we put out a deck and we
31:25basically come at the question for
31:26another angle which is we look at
31:29funding flows so we look at the flow of
31:31money into tech and then we look at
31:34outcomes in terms of how many new
31:36companies are there and how valuable how
31:38valuable are they in total kind of as a
31:40proxy to try to get a sense of like is
31:41is there as the world gone crazy or is
31:43actually is actually are things
31:45relatively more normal than people think
31:46and the two huge observations that we
31:49make are as follows one is these
31:52so-called the unicorns are all companies
31:53a lot of these public companies by the
31:55way optimize these about you know is
31:56gonna be is this way if this were 1994
31:59and we were sitting here we would
32:00probably be getting ready to take
32:01Optimizely public right like he's like
32:03at a stage where you could actually in
32:05the old days you could take a company
32:06public and in the old days uber would be
32:08public today lyft would be public and
32:09everybody would be public and all these
32:10companies to be public but what's
32:12happened is it's now just taking a lot
32:15longer to take companies public and so
32:17companies are staying private a lot
32:18longer and so you've got these
32:19late-stage for answering rounds that are
32:21happening and they're basically
32:21substitutes for IPOs but in our deck we
32:24basically show if you adjust for the
32:25IPOs that aren't happening and the
32:27companies are staying private it's
32:28basically it's almost a flat amount of
32:31money actually flowing into tech and
32:33then the other thing we point out is if
32:34you add up all there's like 59 US tech
32:37companies that are private and are worth
32:38more than a billion dollars if you add
32:40them all up they're worth about one
32:42Facebook right and so in totality
32:44they're worth about one Facebook and I
32:46mean I'm involved in Facebook and I'm a
32:48huge fan of Facebook and Facebook should
32:49be a very valuable company but you know
32:52Facebook vs. 59 other companies all of
32:54which are growing super fast by the way
32:57all the unicorns are worth about half of
32:59Microsoft and all the inter cars are
33:01worth about a third of Apple right and
33:03so you just you know at some point you
33:05ask the question which is would you
33:05rather own half a Microsoft or third of
33:07Apple or would you rather own fifty nine
33:09building the future and you could argue
33:11and debate that either way but it's not
33:13crazy right there's nothing inherently
33:15kind of nutty about that idea and so we
33:19think there's a fair amount of it and
33:20this goes again right back to the theory
33:21in the book as she would find this very
33:23unsurprising which is many of the and by
33:26the way not all these new companies are
33:28gonna work like some of them we're gonna
33:29there's like this a private tech
33:31companies failing it's not a sign of
33:33venture capital not working it's just a
33:34sign of venture capital like you know
33:37not all these companies work and so it's
33:39not going to be a hundred percent
33:40success but the new companies in general
33:42as a set are gonna do incredibly well
33:44they are doing incredibly well and they
33:46are going to do incredibly well and I
33:48think against that it's actually quite
33:50hard to actually see a bubble yeah well
33:52it's a good argument why these companies
33:56will it's not nutty to think they'll do
33:57well one concept that some people do
34:00think is nutty is virtual reality I'm a
34:03big fan of reality why should I care
34:06about virtual reality there's a great
34:10line somebody used online a while ago he
34:12said I went outside once the visuals are
34:15amazing but the plot and characters
34:17sucked so this is one of those things
34:24this is one of those things so of course
34:25virtual reality is this idea literally
34:27it's this idea you put on these goggles
34:28you put on this headset and there's
34:30these screens and it's got 3d graphics
34:32and basically basically the headset it
34:34actually it tricks your kind of
34:36unconscious mind into believing that
34:37you're somewhere else and this is one of
34:40those things if you if you go on YouTube
34:41you can actually see videos that people
34:42trying these products the leading
34:44product is a company we invested in
34:46called oculus they just go on YouTube
34:47and search on oculus and you get all
34:49these videos and you'll watch people
34:50trying this thing on for the first time
34:51and it's bizarre when you see people
34:54doing it because it's just like it seems
34:56so weird it's like they put on these
34:57goggles and then all of a sudden they
34:58like freak out right and looks like the
35:00two most common reactions they either
35:01start laughing hysterically or they
35:02start crying right and it's and but from
35:05the outside it's like what on earth
35:06could possibly be provoking that kind of
35:08an emotional reaction and the reason why
35:11it seems so strange is because we've
35:13grown up our whole lives like we go see
35:14you know this new movie Jurassic world
35:16and it's got the dinosaurs and we play
35:17all these call of duty and it's like
35:18being in a combat zone and all these
35:20things but we see all these simulated
35:22experiences on screens that
35:23distance and our sort of lizard brain
35:26basically knows that it's not real and
35:28so you know you don't actually get
35:29scared when the dinosaur comes at you
35:31and the Jurassic Park movie with VR what
35:34it does is it basically takes over your
35:35nervous system effectively and so it
35:37basically tricks your brain into like
35:38basically thinking that you're there now
35:40it's electrical you know you're not but
35:43like the the lizard brain part of your
35:45your nervous system basically is like
35:46that is a natural dinosaur and he's
35:48actually coming right at me and so and
35:51people start laughing because they just
35:52get in you know you get in these
35:53environments where you're floating
35:54through the clouds or these demos that
35:57you'll try when you try these products
35:58for the first time there's these demos
35:59there's one where literally you're
36:00standing like it's New York City and
36:01you're standing on the top of the
36:02skyscraper and like you look down and
36:05it's like the city and like you're just
36:06literally like you're about to literally
36:08physically collapse like on the floor
36:09like watching this thing because you get
36:11this kind of overwhelming feeling that
36:12you're about to fall off the skyscraper
36:14and so it's this really amazing new
36:17technology I'd encourage everybody to
36:18try it when you get a chance and then it
36:21gets exactly the reaction that you said
36:22which is people are like well wait a
36:23minute what about the real world like
36:24you know okay fine you can go hang out
36:26with dinosaurs or at the top of
36:27skyscrapers or float through the clouds
36:28what's wrong with the real world and
36:30this is one right I basically take a
36:33pretty strong position on this which is
36:34if you like the real world
36:35fair enough and you know if you happen
36:38to live and you know you've live in a
36:39nice place and you've got lots of you
36:40know nice friends and and the weather is
36:42nice and all the rest of it there's a
36:43lot of fun things to do
36:45fair enough most people in the world
36:47don't live in places like that like you
36:49know where I grew up like none of that
36:51and so you know if you live in a you
36:55know in a place where you don't happen
36:56to have a great research university
36:58nearby but if you could go into a
37:00virtual world and if you could go you
37:02know if you could go into basically the
37:03equivalent of a Stanford classroom and
37:04take a class from one of the world's
37:05great professors just as if you were
37:07there in person for a lot of people that
37:09would be amazing if you like sports but
37:12you can't afford to get you know your
37:14favorite team is playing and you know
37:15ticket you know ringside seats or you
37:18know courtside seats at a basketball
37:19game are gonna cost you more money than
37:21you're gonna make in a year
37:22but you really want to experience a
37:24basketball game like they will be able
37:25to project the basketball game in the VR
37:26in a way where it's gonna be like you're
37:28sitting right there at the side on the
37:29side of the court and basically for
37:31every single kind of human experience
37:33there's going to be these new options
37:34that people are going to have with this
37:36technology that they've never had
37:38and I think it's gonna be a man I think
37:39a lot of people's lives are gonna be
37:40made a lot better so we've talked about
37:43artificial intelligence Bitcoin virtual
37:45reality can you give some practical
37:47advice to the people in this room who
37:49are gonna go back to their businesses
37:51that are likely not doing any of those
37:52three things but might be able to think
37:54about these technologies in their
37:56day-to-day or in making their business
37:57better yeah yeah so you know the the
38:00optimistic note that I would say is that
38:02you know these things are coming and you
38:04know there's there's a whole bunch of
38:05other things like this that are coming
38:07and the optimistic thing I would say is
38:10it goes back to what we've been talking
38:12about throughout this whole thing which
38:14is instinctively and by the way I find
38:16myself doing this just as much as
38:17anybody else as succinctly it's like
38:19okay that it like I was okay with I'm on
38:21board with smart phones the internet I
38:22got all that but this new thing is weird
38:23right on this VR thing is sad and you
38:26and so the optimistic thing I would say
38:28is we have the ability as we think about
38:29these things to kind of have open minds
38:31and they kind of say okay like what we
38:33always like to say is the question is
38:35not whether it will work the question is
38:36if it does work how important will it be
38:38and we all have the ability to have an
38:40open mind like that and to basically be
38:42able to think in those terms and it's
38:44hard to do most people don't do that
38:45because new ideas seem strange but we
38:48have the ability to think about new
38:49ideas and we have the ability in our
38:50businesses to think and say okay you
38:52know if you're in the car business like
38:53what would a what would a car dealership
38:55and virtual reality be and it might be
38:57the most spectacular car dealership of
38:59all time and it might make all the
39:00existing car dealerships seem irrelevant
39:01and so if you're a car company that
39:03might make sense to explore or whatever
39:05or whatever those ideas are so the
39:07optimistic note is these technologies
39:08are going to be available for people to
39:09use and I think it's worth thinking
39:11creatively you know the cautionary note
39:13is also you know goes back to this book
39:15which is they don't all happen overnight
39:16and so and this is directly in line up
39:19obviously with what Optimizely does
39:21which is experiments are a really good
39:23idea you know it's easy for me to sit up
39:25here and say that this stuff is going to
39:26sweep the world in the next 12 months it
39:28may take it may happen fast it may
39:30happen slow and so being able to run
39:33experiments being able to trial things
39:35being able to you know make small bets
39:37instead of making large bets and and be
39:40able to learn as you go I think is
39:41incredibly important yeah
39:43well we've talked a lot about the future
39:45let's talk about this year next year we
39:47a presidential election cycle and the
39:50origin of our company came out of the
39:51work in the 2008 Obama campaign where we
39:54were trying to use data to help the
39:56campaign make better decisions we were
39:58lucky to have both Obama and Romney use
40:00our platform in 2012 and I'd love to
40:03hear your take on data in campaigning
40:04and where you see huge opportunities in
40:07this upcoming cycle for the campaign's
40:09to really made me lead the way when it
40:11comes to data-driven decision making
40:13yeah do you have all 2000 Republican
40:15candidates on the platform that I
40:17wouldn't be surprised if they've decided
40:20to use our platform but I won't comment
40:22on Donald Trump well I'm not sure he can
40:28test different hair styles so so
40:35politics and Dan you know Dan knows more
40:37about this that dance forgotten about
40:39this than I know but politics is this
40:41fascinating thing right so 2008 right so
40:432008 I was a big part of the story right
40:452008 was Obama got the jump on the
40:47Republicans I think you know a whole
40:48bunch of fronts but I guess fundraising
40:49was maybe the really big breakthrough in
40:502008 online fundraising turned out to be
40:52a huge thing and then the Republicans
40:54thought they had this all figured out
40:55for 2012 in a 2012 there Democrats made
40:58another huge advance with this kind of
41:00on the ground on the other on the
41:02groundwork and there were all these
41:03articles written about you know the
41:04democratic system worked incredibly well
41:05the Republican system that actually
41:06didn't work on that day for you know to
41:09get out the vote efforts and so politics
41:12politics is have its and in that context
41:15it's not surprised that Optimizely panic
41:16came out of this kind of superheated
41:17kind of political thing politics the
41:20politicians or political campaigns are a
41:22great test bed for these new a lot of
41:24these new ideas and this has been true
41:26historically right that you know TV you
41:28know this is quite as he's great you
41:29know stories you know for the old days
41:30of you know TV became important kind of
41:32in 1960 with the Kennedy Nixon debates
41:34right which was kind of the first time
41:35that voters actually saw candidates like
41:38on TV as opposed to hearing them through
41:39radio and all of a sudden you know how a
41:41candidate looked and whether they look
41:43like they were you know shifty and
41:44sweaty or calm cool and collected
41:45actually mattered for the first time and
41:48so say new technology kind of always
41:50gets trialed in these political
41:52environments but the political
41:54environments are always one offs right
41:55they're always like because in you seat
41:57you see this you get you get you saw
41:58this is you see this which is you know
42:01you seen this this time that can't be
42:02the Republican campaign the Democratic
42:03campaign they're gonna put together
42:04these technology teams for 2016 they're
42:06gonna do all these new things and it's
42:09entirely with one goal right which is to
42:10win the election right and it's so
42:12importantly in the election that they'll
42:13do anything that they think gives them
42:15an edge in winning the election and then
42:17the experiments will either work or they
42:18won't work and then the teams will
42:19disband right and then the people will
42:21literally all leave and so and then four
42:24years later it's an entirely new group
42:25of people which means it's also an
42:28entirely new group of ideas and so it
42:29goes back to earlier discussion it's
42:31like the political campaigns are
42:31actually quick to jump on the new ideas
42:33because it's a new group of younger
42:35people kind of every single time and so
42:37it's is very very interesting testbed
42:39and I think you know for example the
42:41whole a lot of what is now happening
42:43with crowdfunding and Kickstarter and
42:44crowd tilt and all these things is kind
42:45of in a lot of ways sort of derivations
42:47of what happened in 2008 with the Obama
42:49campaign a lot of things now that
42:51involve you know location-based social
42:53networking services you know are getting
42:55now inspired by what happened with the
42:56Obama campaign in 2012 and so I would
42:59just I would expect a tremendous amount
43:01of experimentation in these campaigns I
43:02think there's lessons to be lessons to
43:04be learned this time for sure
43:05regardless of who wins and it's gonna be
43:09it's gonna be a testbed the one that I'm
43:11waiting for that hasn't happened
43:13actually this is interesting it has
43:14happened it just hasn't happened here
43:15the one that I'm waiting for is the
43:17first social networking election right
43:19and so fundraising or get out the vote
43:21the kinds of things that people have
43:22done so far with this technology applied
43:24to campaigns this had to do with kind of
43:26running campaigns the traditional way
43:27but like most of the advertising has
43:29still been TV advertising I think there
43:31is going to be I think there's gonna be
43:33an election of which the entire thing is
43:34gonna pivot on social networks and it's
43:35going to turn out that the candidate
43:36that most effectively use Facebook and
43:38Pinterest and Twitter and all these
43:39things is the one who wins actually this
43:42has happened both India and Indonesia in
43:45the last election the winning candidates
43:47credit their wins to the social
43:48networking platforms and the Indian
43:50election is really worth looking at
43:52because Modi it turns out running for
43:53president India is a difficult job
43:55because India is gigantic and there's
43:57like a billion half people and so you
43:59can't even do the level of retail
44:01campaigning they do here in the US and
44:03so his campaign made it incredibly
44:04effective use of social networks
44:06incredibly effective use of online
44:07communication and messaging and he
44:10credits that with his victory and I
44:12think that will happen here
44:14I don't know whether that's in 2016 or
44:16in 2020 probably one or the other so we
44:21have a few minutes left and I want to
44:23end by talking about philanthropy which
44:25is something I know you care a lot about
44:26we had Optimizely launched Optimizely
44:29org last year at Opticon and through
44:32that have been able to really help
44:34nonprofits enable them to turn their
44:37data into action and and through both
44:39helping them get improved fundraising
44:41and get more volunteers but also
44:43advocacy and all the other causes they
44:45care about love to hear your perspective
44:46on not just philanthropy but the role
44:49startups and businesses like ourselves
44:50can play in helping furthering those
44:52colleges so this is a really personal
44:54topic for me my wife is my wife ACEF
44:57teaches philanthropy at Stanford so she
44:59and I have a very synergistic marriage
45:01where I make the money and she gives it
45:04away and she's very clear with me on my
45:08role in the partnership so this is a
45:13deeply personal thing I would say it's
45:17incredibly encouraging this new
45:19generation of corporate philanthropy
45:20this idea the companies have a role to
45:22play in philanthropy I think is a very
45:23encouraging idea you know the model for
45:25so long was that companies exist you
45:27know and this remains true but like
45:29companies exist to make money for their
45:30shareholders and then you know business
45:32a lot of businesspeople in the old days
45:33they would make a lot of money in their
45:35business careers Bill Gates is a great
45:36example of this make a lot of basically
45:38focus on business for 30 years make a
45:40lot of money and then at some point you
45:41retire and then you start giving the
45:42money away right and you know
45:43historically philanthropy actually has
45:45been primarily you know old people it's
45:48actually an interesting problem like in
45:49medical research it turns out that the
45:51diseases that affect old people there's
45:53much more funding for the cure than
45:54diseases affect young people because the
45:56medical research funding comes from old
45:58people who have made a lot of money who
45:59have those problems and they don't care
46:01that much about things that affect 30
46:03year olds anymore and so that's kind of
46:06been the model for a long time but now
46:08you have these new leaders and Marc
46:09Benioff you know in tech I think gets
46:11tremendous credit for this Mark
46:12Zuckerberg who I work with is doing a
46:14huge amount on this now and will be
46:16doing a lot more there are other you
46:18know some people are very well known
46:20some people actually not well known but
46:21are very active philanthropist in tech
46:23from a much earlier age Pierre Omidyar
46:26another guy's been very very very out
46:28front on this who found it eBay who's
46:30been doing philanthropy basically from
46:31the very start and then there is this
46:33movement among Silicon Valley startups
46:35to do the kind of thing that you're
46:36describing so a lot of its inspired by
46:38what Salesforce has done which is this
46:39kind of the idea of the one-one-one
46:40program right one percent of equity one
46:43percent of profits some product and one
46:45percent of our time you follow that
46:47model okay right exactly
46:49and so I think it's tremendously
46:51positive there are people so that's all
46:54the good the argument I get in with
46:56people is there are people who are
46:58saying every company should do this
46:59right every company should adopt the
47:00one-one-one model Marc Benioff who I
47:03think is a hero actually wrote a book
47:04basically talking about how to do this
47:06with it with every company and so their
47:08investors in the valley now who are
47:09saying every every company should do
47:10this should be part of every company's
47:11mission to do this so that's where I
47:14differ a little bit I think companies I
47:16think it I think companies should do
47:17what's right for each company I think I
47:19think companies I think companies in
47:21their strategies and in how they hire
47:23and how they train and how they operate
47:25should do the things that are right for
47:26them I think it's very dangerous in
47:28business to cookie-cutter kind of
47:30approaches without really thinking
47:31things through that are specific to each
47:32company because people are different and
47:34different kinds of people come together
47:36in different kinds of companies to do
47:37different things in business and I think
47:39the same thing is true of philanthropy
47:40which is I think there are many
47:41different ways to engage in philanthropy
47:44and the one one one approach is one of
47:46them but I think there are also many
47:47others but for example there are some
47:50companies that have a much bigger focus
47:51on having their products get used by
47:53nonprofit organizations or by you know
47:56educational institutions for free there
47:57are other companies where that isn't the
47:59relevant concept and they're much more
48:00focused on donating a percentage of
48:02profits and so there's a variety
48:04different models and then I also think
48:06the old model of focusing on business
48:08and basically staying focused on
48:10business for for you know a potentially
48:12a long period of time and then
48:13eventually being able to make money
48:15through doing that and then be able to
48:16give that money away I also think that's
48:17a very good I don't think there's
48:19anything wrong with that model at all
48:20and so I think this is an area where we
48:22should encourage and we encourage this
48:24among our companies is we don't we don't
48:26dictate we encourage experimentation and
48:28we encourage different approaches and so
48:31I don't I don't second-guess anybody's
48:32approach on this but just going back to
48:36the beginning I think it's just
48:36tremendously good that this has become a
48:38topic that people are really talking
48:39about an actor huh great well please
48:42join me in thanking Marc Andreessen for
48:44being here today thank you
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