#1263 Shaun Maguire | Sequoia Partner on Bitcoin, Elon Musk, SpaceX, and DARPA

Shaun Maguire is a partner at Sequoia Capital. In this conversation, we talk about Shaun’s time with DARPA, including a deployment to Afghanistan, and what DARPA was thinking of bitcoin in the early days. We also talk about a company that Shaun helped co-found which sold for a billion dollars, breakdown of Sequoia Capital, SpaceX, Tesla, Elon Musk, and more. ======================= Auradine, a leader in web infrastructure solutions including blockchain, AI, and privacy, has unveiled the world's first 4nm Bitcoin mining systems, featuring breakthrough EnergyTune™ technology, setting new standards in performance and energy efficiency. The Teraflux™ product line from Auradine offers best-in-class performance, efficiency, and total cost of ownership (TCO), positioning it as the optimal choice for Bitcoin mining needs. With EnergyTune™, a patent-pending technology, Auradine's Teraflux™ systems enable rapid demand response and optimal energy usage, fostering a symbiotic relationship with electrical grids, and contributing to sustainable energy practices. Designed and manufactured in the US, Auradine's Teraflux™ product line not only ensures cutting-edge technology but also mitigates supply chain risks and provides increased supply chain resiliency. Visit ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠www.auradine.com⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ for more information the Teraflux bitcoin mining systems. ======================= Get Better Crypto Data: Do you want faster, easier crypto data? Sign up for Velo Data, a new product that we have been working on to solve this problem: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠velowaitlist.com⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ======================= Pomp writes a daily letter to over 250,000+ investors about business, technology, and finance. He breaks down complex topics into easy-to-understand language while sharing opinions on various aspects of each industry. You can subscribe at https://pomp.substack.com/

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02Anthony Pompliano?

  What's up everyone? This is Anthony Pompliano. Many of you know me as Pomp. You're listening to the Pomp Podcast, which is my effort to find the most interesting people in the world and sit with them for hours while I ask questions in an effort to learn. So it would mean the world to me if you would subscribe to the show on your favorite audio platform, watch episodes on YouTube, and tell your friends and family about the podcast. My goal is to help millions learn from the world's most interesting people. So let's get into today's episode. Today's episode is with Sean McGuire. Sean is a partner at Sequoia Capital. In this conversation, we talk about Sean's time with DARPA, including a deployment to Afghanistan, and what DARPA was thinking about Bitcoin in the early days. Then we talk about a company that Sean helped cofound,

• 0:46Anthony Pompliano?

  which was sold for $1 billion, how Sequoia itself thinks about traits of the best founders, how they make decisions internally, and how they think about allocating capital in an ever-changing environment. And then Sean and I go super deep on all types of different technologies, including how he looks at SpaceX, where Sequoia and himself have invested over $1 billion in the last couple of years. We talk about Tesla, Elon Musk, and much, much more. I really enjoyed this conversation with Sean, and I really hope that you guys enjoy it as well. I really learned a lot from Sean, and I think that this is going to be one of those episodes that people will come back to quite often. Here is my conversation with Sean McGuire.

• 1:24Speaker 01

  Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only.

• 1:48Anthony Pompliano?

  This episode is brought to you by Aradine. They are a brand-new startup led by a number of Silicon Valley legends who just raised $81 million to build the future of internet infrastructure. You're probably wondering what that means. Let me explain. There are numerous new disruptive technologies that are being adopted simultaneously, from blockchain to artificial intelligence to zero-knowledge technologies. In order to ensure that these technologies thrive in this new world, we need new infrastructure and that is where Auradine comes in. They just launched their first product line called Terraflux, which is a Bitcoin miner powered by the world's first 4 nanometer silicon chip technology. These air-cooled, single-phase and dual-phase immersion cooling miners have unrivaled speed and efficiency.

• 2:32Anthony Pompliano?

  They have superior uptime and they leverage a brand-new innovation called Energy Tune that allows miners to dynamically adjust the energy consumption and Bitcoin hash rate based on demand response needs of the electrical grids. Auradine is an ambitious company working on hard problems. I'm really impressed with them and if you want to check out more, you can go to auradine.com. That's A-U-R-A-D-I-N-E.com. Go check them out at auradine.com today.

• 3:00Anthony Pompliano?

  Before we get into this episode, I also want to tell you about a brand-new product called Velo. Velo is faster, easier crypto data. Everyone in the industry is always looking for, what's the price? What's going on on the exchanges? Where are assets flowing or not flowing? How is things like open interest and derivatives actually playing out in the market? Well, that's where Velo comes in. It's faster and easier crypto data. You can go to velowaitlist.com today. Myself and a couple of friends, we invested in the business. We're advising the founder and we think it's pretty cool. This one is something that keeps me informed on a daily basis, so you should check them out at velowaitlist.com. That's V-E-L-O waitlist.com. All right, guys. Bang, bang. I've got Sean here with me.

• 3:45Anthony Pompliano?

  Sean, I thought a great place to start is you, as a civilian, worked with DARPA and you both went to Afghanistan for a number of months. You guys were investigating Bitcoin. There's all kinds of different technologies that very, very early on DARPA was interested in. Describe a little bit like what is DARPA and how did you get involved with that organization?

• 4:06Speaker 02

  Oh, that's a good one. How much, how much time we got for this one?

• 4:10Anthony Pompliano?

  As much time as you need.

• 4:11Speaker 02

  All right. This is a crazy story. Um, but so what is DARPA? DARPA is the research arm of the Department of Defense. In the past, the way DARPA has operated is kind of will set a vision of there's some technology pain point or technology need. And we'll then go create a program. And what that means is like, there'll be a program manager that, for example, DARPA created the internet, you know, it wasn't Al Gore. It was, it was DARPA. And the way that happened is basically it's kind of realized by some people at DARPA and in other places that there are all these computers getting built. We had to network them together so that you could share resources like share printers, which were really expensive at the time.

• 4:56Speaker 02

  Uh, and just have them talk to each other. DARPA doesn't build the technology though, historically. DARPA just comes up with the idea, manages it and has the money. Um, and so like in the case of ARPANET, which was the precursor to the internet, came up with the idea, um, or at least like manage the program and then puts out what's called a solicitation for proposals where hundreds of people will apply hundreds of groups. And then the, the program manager is kind of like a DJ where, you know, they'll say, hey, I think UCLA is the best at the networking side of this. And, you know, this other group is best at like

• 5:38Speaker 02

  building the firmware that would go on like a early router. And so, and, and the program manager is also in charge of kind of building in redundancy in case one group doesn't perform. And so they usually choose call it, they'll kind of break the problem, say, designing an early internet into maybe four or five sub pieces. And choose like two to four groups to build each of those. But DARPA created the internet stealth technology, uh, kind of precursor to GPS.

• 6:09Speaker 02

  mRNA vaccines are very controversial these days, but DARPA had a big role to play in that, basically of giving Moderna a bunch of money when it was kind of an undiscovered company around 2012. On and on can list 50 plus technologies created by DARPA. For myself, I have a very weird background in every way. I'll just, I'll get this out of the table. I got an F in algebra two in high school. I'm very proud of that. It's one of my proudest accomplishments. It's a good story. But I was just a weird kid. I was hacking on computers and building stuff, just kind of doing my own thing. But a lot

• 6:51Speaker 02

  of my family was actually in the military. Both of my grandfathers served in the military. My dad's dad, all three of his brothers served in the military. Two of them died in World War II. One of my dad's brothers was a career naval officer when I was a kid. He was a, he was a doctor. And when I was a kid, he was the doctor that ran Pendleton Hospital, you know, where like the SEALs train. And so my cousins lived on the base. And then he went and ran Walter Reed Hospital, or Bethesda Naval. Dad goes by two names. And so my cousins lived on that base. And so I basically, a lot of Americans grew up with no exposure to the military. I grew up, like, if I wanted to see my cousins who lived

• 7:36Speaker 02

  an hour away from us, we would drive down and go on the base. And then my mom's dad, he was also a former Navy guy. And so he and I would go ride bicycles around Pendleton. And I, it's just kind of a, I had a lot of exposure. And as a kid, I, I, I actually really wanted to enlist. That was something that I, I thought very seriously about. But with the F in algebra two and kind of like a really bad track record.

• 8:07Speaker 02

  At eighteen, um, you know, if, if you enlist and say the Navy and I mean, my goal would have been to try to become a SEAL. That was kind of my dream growing up around Pendleton. You know, if you don't make it, if you wash up for whatever reason, if you have a even weird things, like if you have a heart arrhythmia that you, you didn't know about, then you kind of get put into the normal enlisted ranks and you will have, you will struggle to find someone that's worse at taking orders than me. Like I'm, I'm pretty good in chaotic, unstructured situations. I'm absolutely horrible with structure. And, you know, I, I'm embarrassed I didn't have the self-confidence to, you know, go do it and, and like shoot my shot, but I was, I was genuinely really nervous about

• 8:52Speaker 02

  kind of not making it. But so for myself, I, I had from time as a kid, I had this like ambition to go serve my country and, and kind of be in the military. Um, but I, I ended up, despite the F and O two, ended up getting a PhD in math. And I mean, technically it was in the physics department, but it started in the math department. And kind of while I was doing my PhD, I was at, started at Stanford and then I was at Caltech. Um, through total fluke is like out of a movie. I met this woman. Her name is Regina Dugan. She, she was the director of DARPA at the time.

• 9:33Speaker 02

  She's an unbelievable person. She's one of the people in the world that means the most to me. I haven't, I don't talk to her that much anymore, but Regina, like you're, you're the goat. I appreciate you. And there was like a Caltech lunch that she gave a talk at. There were probably 25 people in the room. A girl said something stupid. It kind of led to an awkward situation. I jumped in. I kind of stood out for it. At the end, she, she was really busy and she stopped in the doorway. And she said, if any of you want to get involved in it, she stopped in the doorway, but she looked me right in the eye. And she said, she said, if any of you want to get involved in a DARPA project, find my contact information online and get in touch with me. And, you know, I was like, was she talking to me? Like the director of DARPA?

• 10:19Speaker 02

  And, but I found her contact information. I sent her an email at like nine PM that night. We were, I was staying in like a little youth hostel in DC.

• 10:30Speaker 02

  She responded, I mean, I have the emails, but I think it was four forty-four in the morning. Like she, she's a beast and she said, yes, I was talking to you. Um, you know, what's your cell phone number? I'm going to call you later.

• 10:44Speaker 02

  She called me around ten AM. And she basically asked if I could go to DARPA immediately and meet with a few people. Um, I initially, so I was supposed to fly to Panama. Like, like literally at two thirty PM or something. It's ten AM and I was in Bethesda, Maryland at the NIH. And she was asking me to go to Arlington, Virginia. For any of you that know DC geography, it's, you know, it's, it's an hour away or whatever. And then I had to get to Dulles Airport. Uh, and it, and if I didn't make it, I would miss my friend in Panama.

• 11:19Speaker 02

  Um, and for words worth, El Salvador goes into that story if we want to get there later, but uh, so went, met, sorry, I actually initially said, no, I, I can't make it. Hung up the phone. A minute later, I just had this deep, deep pit in my stomach of I was closing a door on like, oh, truly once in a lifetime opportunity. I could just kind of hear her voice deflate and she said that she would have me do some phone calls with people, but I, I just called her back. I just re-dialled the number. She picked up. I was like, I'm on my way. I'll be there as fast as I can. I got there. Uh, I joined a very unique program. It's like basically something that DARPA hasn't really ever done.

• 12:03Speaker 02

  Normally DARPA doesn't build technology. Normally, normally DARPA just like builds technology for twenty years in the future. But she realized when she came in, she basically went and asked a bunch of generals, like people at the Joint Chiefs, is DARPA actually useful? And the reaction she got was DARPA is useful twenty years in the future. Like DARPA is useful for the next war. But it's not useful for the current wars. And at the time, you know, Things were still very active in Afghanistan in particular. And to her, she felt like that was unacceptable. And so she decided to spin up kind of a live operational team inside of DARPA that was actually

• 12:42Speaker 02

  building technology, you know, like fast, fast prototyping based on needs or gluing existing technologies together that could be deployed very rapidly. And there were really like 10 of us that were the core kind of architects and drivers here and then some people that helped support us. But part of this is we'd be rotating in and out of Afghanistan because it's just really hard to know what to build if you're not actually on the ground and seeing the gaps and what people need.

• 13:14Speaker 02

  And so she recruited me for that program. I mean, like, within three hours of

• 13:23Speaker 02

  meeting her and of meeting people at DARPA, I had a, this is like, I had an early smartphone. I didn't have an iPhone yet. This is in 2009.

• 13:32Speaker 02

  And I got an email like saying, when could you be in DC? I was literally sitting on a plane to Panama at the time at like 2:30, I made the flight. And I responded like, I'll be there in eight days because I basically went to Panama, met my friend. We, this was like winter break during our PhDs in 2009 and we seen my friend Jeff Marlowe, shout out Jeff. And we basically rode buses from Panama City to to Yucatan Peninsula. So, you know, through all the countries there, including through El Salvador. And that was just very fast, we're crazy maca- masochists.

• 14:15Speaker 02

  So it was like, call it one long bus ride a day. We made it through, call it eight countries in eight days. And then I moved to DC with my backpack and spent two years living out of backpack

• 14:29Speaker 02

  doing crazy shit.

• 14:31Anthony Pompliano?

  Obviously, there's a bunch of stuff that you guys do that you can't talk about. But when you're doing these rotations into Afghanistan, it reminds me a lot of maybe Elon Musk talking about, hey, the engineers got to be right next to the production line, right? The designers need to be right next to the engineers. Like, there has to be that feedback loop and understanding what's working, what's not working, and what your design decisions actually have in terms of implications. What are some of the things that you guys would do on the ground to actually get that feedback to really understand what to build and maybe what not to build?

• 15:01Speaker 02

  Amazing question. I mean, it was that there's just no substitute for talking to lots and lots of people that are like actually just coming back from combat and they have an immediate memory of some problem or pain point, or just literally moving around the country. Like, I kind of, I mean, I don't remember exactly how many Black Hawk flights I did while I was there, but probably 30, you know, in three and a half months. I would just go kind of and like rode in cars around like seeing stuff happening every day almost.

• 15:43Speaker 02

  And just the act of moving and talking to people, it just completely changed your perspective. I'll give you an incredibly simple, stupid example.

• 15:57Speaker 02

  I had a, I had a lot of data sets. One of the data sets was around ID stuff. That's basically all I should say, but one of the variables in there was like, this was a massive data set and one of the columns was called culvert. I didn't know what a culvert was, so I just kind of ignored that like column. Culverts are kind of like when you have storm drainage under, under road, wherever it's like what the water flows through. And I mean, I'm very embarrassed that I didn't, maybe it's my, my poor high school education, but I didn't know what that was. And it turns out it's incredibly important for finding IDs because you don't have to

• 16:42Speaker 02

  dig up the road if there's a culvert under you, you know, someone can just crawl into the culvert and put an ID down there. And, you know, if you're going to try to, if you're like sitting in DC looking at a data set and, you know, there's hundreds of columns in it.

• 16:57Speaker 02

  It's just sometimes hard and and this was pretty deep learning and so uh still a lot of this was like human intuition based and we called it statistical learning rather than you know these black box neural nets um and so things like that so powerful but I mean another example was uh I I was basically I had kind of a schedule where a couple of days a week I would go from this one base to another base and I was about an hour and a half drive normally it's only maybe five miles but there was insane traffic and it was I would do it a few days a week and I would do it every Friday normally it would take an hour and a half um

• 17:40Speaker 02

  this one Friday we got there in like fifteen minutes there was literally no car on the road it was eerie it was so scary and we get to the base and and and the base was HQ ISAF it was like the primary base for for the joint command of kind of all the different allied nations that were all the allied western nations that were deployed there and right when we got there we went to like all the intel channels to try to understand is there like do we is there an attack coming or what's happening and there wasn't any clear like obviously there's always a lot of noise but there wasn't anything clear and then a few hours later like a

• 18:25Speaker 02

  large combined attack happened coordinated attack you know across like multiple bases you know rockets into towers and stuff and and it's just one of these things where the context of like oh wow when when somehow people knew and that having no cars on the having like the car traffic decrease was clearly predictive that something was gonna happen and maybe not a hundred percent of the time but things like that is just If you're not there, it's hard to have the context that that's relevant. But when you're there, it's just the most obvious thing in the world. You know, you have a routine and now you just had this major break from your routine.

• 19:08Speaker 02

  And so I mean, I could give lots of examples. The best examples are, you know, ones I can't talk about, but I don't know.

• 19:16Anthony Pompliano?

  What what's interesting about it is it's like the human intelligence, right? Obviously is incredibly powerful. And one of the things that over 20 years, you know, of kind of dealing with insurgencies and these like forever wars, it seems like people on the ground really started to understand that you can have all the best technology in the world. You can have, you know, all of the vehicles that can sustain, you know, explosives. You can do all sorts of data analysis. You can have the best kind of trained teams. Literally, the difference between life and death could be like, does the guy on the street corner like you enough to simply tell you, don't go down that road? Right?

• 19:53Speaker 02

  And that's the difference. And that happens all it's such a good point like that happens all the time. I just want to call it one, one thing that I gloss over. Part of, part of why I gave those examples is I was working on this from 2010 to 2012 primarily. And that was the very early days of like big data. It was a very, very, very beginning. And so we were always, we kind of had a mandate to work with any type of technology. But the thing where we got the most leverage at that moment in time was kind of big data trying to take all these data sets or sensor systems, whatever, that had never really been analyzed. And so that just that's why I gave those examples. And, you know, and the other thing I just want to say is

• 20:39Speaker 02

  I hopefully from the preamble around like having a lot of family that served.

• 20:45Speaker 02

  It's not that I'm so special or anything, but there's something about when you are deployed in uniform and you have like a job and everyone else's life depends on you doing that job very well and you're working like fourteen hours a day in a super stressful situation. It's hard for your mind to like go come up with new ideas or sometimes even to like see the patterns that are like should be obvious, but are just not obvious when you're so stressed and so focused on a single task. And so we had this weird mandate to just kind of go be observers almost, but like very, very technical observers that were aware of what technologies existed and what was possible and just kind of go be glue to fit in there.

• 21:26Speaker 02

  It's like it's, I, I, I think it was a, it was literally a genius idea of Dr. Dugan. Uh, and, and it really was, it was a life changing thing for me.

• 21:35Anthony Pompliano?

  While you were at DARPA, uh, obviously two thousand and ten to two thousand and twelve is right after Bitcoin is created and kind of launched to the world. Um, I know that DARPA and a number of other organizations pretty quickly started to pay attention to this thing. Um, what, what do you remember from that time period of just like, what were people thinking internally? Uh, were they excited? Were they not? And there's research going on around it. Just talk a little bit as to, uh, kind of what that experience was.

• 21:57Speaker 02

  Yeah, I mean, it was like, it was crazy to be at DARPA in the early day, to be at DARPA embedded in Afghanistan during this time because one of the core things we were doing was with, especially from the perspective of big data, was a lot of follow the money work. Um, so like trying to understand how money gets in and out of the country, trying to reverse engineer the chain of shell companies and, and figure out like sources of where money's coming from. It was, it was a major thing we were doing and, you know, I think at least four or five things we did made the front page of the New York Times. Uh, I'm very, very proud of that. Um, so like we, like we were actually successful at

• 22:42Speaker 02

  this. Uh, and if you're doing follow the money work, you know, with terrorist financing in two thousand and ten to twelve. Bitcoin was just like an unbelievable revelation. We would talk about it almost every day of what does this mean? Like, should we be tracking it more? Like, is it being used, you know, and uh it's easy now in twenty twenty-three to like understand, to look back on it. But in the moment, we just had no idea what was gonna happen to it. Like, it was a tiny little thing.

• 23:21Speaker 02

  Um, but it was very disruptive. It wasn't now, today, I would say that Bitcoin is the most traceable money in the world. At the time, it wasn't clear like how the on-ramps and offers would work and, you know, if it would be traceable or not. Um.

• 23:40Speaker 02

  But looking back, like Bitcoin to me is the most traceable money in the world. But it's also to me the best money. I, I, I am a mega Bitcoin fan. But it was just, it was a truly core part of what we were doing. And then leaving DARPA. Immediately from there, um, myself and two friends came up with, we basically decided to start a research company that was doing DARPA research. So we, we kind of were getting contracts from DARPA to do AI research, big data research, cybersecurity research. And a about a year and a half later, we brought in another person who

• 24:20Speaker 02

  came up with a really smart idea, um, that became like our product, which became the whole business. And in, in like late twenty thirteen, that idea actually used Bitcoin. Like, we actually, we were using Bitcoin. This, it's kind of a long story, but we needed, we needed to do computation that no one would be able to trace back to us. And we were using Bitcoin to basically pay like Estonian and uh some like Baltic. Server companies to go kind of run compute jobs for us, which then would get pushed on the internet. And as crazy as it sounds, we actually needed to do that back then. And the architecture evolved beyond that after maybe six months.

• 25:03Speaker 02

  But anyways, we were using it.

• 25:07Anthony Pompliano?

  And what was the idea in terms of like, what were you guys trying to do? And I know that this business ended up growing quite large and you guys eventually were able to sell it. But what was the original idea that you guys said, hey, look, let's turn this into a product?

• 25:20Speaker 02

  Yeah, so the original idea, what the observation was that if you go back to 2012, 2013, if you ask basically any company or government agency, what is your network? Like, give me a list of all of the computer devices you own. Give me a list of all of the video cameras, the servers, the, you know, the like routers. Give me a list of all of the devices that you own. Believe it or not, no one had those lists, like no one had a map of their own assets on the internet.

• 26:01Speaker 02

  And if you're going to defend something, like you need to have a map before you can defend it. I have so many crazy examples of, I mean, like servers that had been running for 30, 40 years that were like put inside drywall that people still like, you know, didn't know existed anymore. And so basically, we, that was the insight. I was not the one that came up with that insight. One of my co-founders did, to give them credit.

• 26:33Speaker 02

  But it was such an obvious insight to us, once we had it, based on what we'd been doing. And so we decided, okay, this is a super important problem. Cybersecurity is going to be huge, like, let's go solve this problem. And so now this is a kind of a category in cybersecurity called attack surface management is what it got named later on. And so the way we solved this, kind of the insight that another co-founder had, like one had the idea of what the product should be. The other had the idea of how to build the technology. And I basically sold it and, you know, executed on it and hired a lot of the team.

• 27:09Speaker 02

  But my co-founder kind of realized that.

• 27:14Speaker 02

  In 2012, we'd just gotten to the point where you could

• 27:19Speaker 02

  use big data ideas and send traffic, send packets to literally every single device on the internet, like to every single device and on a regular cadence, like every hour or so, and see what responses you get back and like through kind of what we call fingerprinting, you could figure out what those devices were. And so we started off by building a superset of every single device on the public internet. If something was behind a properly configured firewall, then, or if it was on a blacklist or whitelist of what we weren't supposed to send packets to, then we wouldn't touch it. But otherwise, we knew everything on the internet. And then from there, we would try to figure out from the superset of everything, who owns what?

• 28:05Speaker 02

  You know, is Goldman Sachs owns this? Does JP Morgan own this? Does the Navy own this? And, and so we kind of would start from the top and then segment everything. And part of why we needed Bitcoin is we were sending so much internet volume that if people knew that all the packets were coming from us, like if we were sending from the same server infrastructure, then they could just ban any packets from those servers going to them. And so we wanted to have like server infrastructure that wouldn't be traceable to us and that we could kind of move around so that people wouldn't realize that we were a kind of effectively like a very light DDoS, but kind of a DDoS.

• 28:50Anthony Pompliano?

  How much you guys sold the company for?

• 28:52Speaker 02

  A billion dollars. And it's funny, the public, the, it was publicly reported as a little less than that.

• 29:01Speaker 02

  And it's kind of, I don't even know why, but the acquirer wanted to report it as less. And so they didn't include basically, so it was, it was a billion and $15 million, 1.05 billion to the cap table. So like to investors or any employees that were no longer there. But they didn't include in the announced number, like

• 29:22Speaker 02

  The revested equity for the people that were continuing or or not just revested equity, just any equity that been granted, but not yet fully vested. And so anyways, that was a discrepancy.

• 29:39Anthony Pompliano?

  Yeah, it's um, it's interesting how they kind of think about that. Another thing is um, you've uh, you've tweeted a bunch of times about uh, Naib uh, Bukelli down in El Salvador. And um, I think that uh, he obviously is implementing a pretty radical plan, uh, radical just being different, right? Not necessarily good or bad. The impact so far or the results seem to be pretty encouraging. There's obviously some people have concerns about, you know, kind of the style or or the concerns in terms of what could potentially be used as abuse of power. But uh, so far it looks like he is drastically stomping down on uh, criminal activity. He seems to be cleaning up uh, a lot of corruption. And then uh, it looks like, you know, citizens basically are headed towards a better life, right? One that has more freedom, more prosperity, et cetera. What what has been your experience?

• 30:23Anthony Pompliano?

  I know you've gone to the country a bunch of times and and seem to have studied, you know, what he's doing. What what's your read on uh, what's going on there?

• 30:29Speaker 02

  So I I've been to El Salvador, I think, five times. And I've I've traveled it pretty extensively, you know, like I've taken buses from the south to the north. I've been to the volcanoes, I've been to the beaches, San Salvador, et cetera. Um, and I have a few friends there

• 30:49Speaker 02

  that I kind of still get to check in with and see how things are going. And it's it's weird. The first time I went there, I I fell in love with the country. It was super dangerous. I think the first time I went was 2007 and it was super dangerous at the time. Um, and when you talk to, I mean, like, my friend had security at their house, like it was, they were, it was, you could feel MS thirteen's presence. Um, and

• 31:18Speaker 02

  Look, I'm, I've been really impressed by Bukali today. Like, I've, I've been blown away by him today. Uh, I think that he inherited a horrendous situation. I mean, you can go look at the murder rates in the country 10 years ago compared to today. And it's kind of like, he inherited a trauma patient that had been shot like four times and was bleeding out. And he had to take like really radical, kind of risky action to stabilize the patient. And I think he's done that masterfully. Um, there's still a question around the future. So I think he's done the stabilization step incredibly well.

• 32:01Speaker 02

  We don't know exactly where it'll go in the future. Um, but so far, what I've seen from Bukali has been just like incredible nuance. Um, like huge bravery, uh, willing to look stupid in the short run to be vindicated in the long run, which I think very few politicians are willing to do these days. So I, I hope that's actually an example for other politicians that sometimes, you know, like, he looked really stupid when he bought Bitcoin and the price went down. Uh, but now he has a 93% approval rating and, um, you know, he's just, I've been really impressed by him. I've been very impressed by his nuanced views on things and kind of

• 32:47Speaker 02

  the risk-taking and the ability to try to engage the technology community. So I don't know where it'll go, but I've been really impressed so far.

• 32:56Anthony Pompliano?

  When you think about, um, a politician like that, how much do you think age plays into it? Like, obviously, uh, El Salvador seems to be like the exact opposite of the United States. And, and, uh, one of the things, uh, a number of friends and I've been talking about is just like, uh, no matter how innovative you want to be, no matter how, um, you know, kind of, uh, uh, refreshed thinking you want to be, age does play a role, right? And especially if you are then not only yourself getting older, but then you're surrounded by older people as well. I think one thing that venture capitalists figured out very early on is like, hang out with young people, right? Like that's where the fresh ideas are. That's where kind of innovation comes from. I really don't know, right? Maybe politicians are spending time with a bunch of young people. It doesn't strike me that way.

• 33:37Anthony Pompliano?

  But Bukele seems to be, well, obviously one is younger, but also two is the average age in some of these developing nations tends to be younger as well. And so do you think that actually plays a huge role? Or is that something that like, we want to kind of put it into a box and explain it, but, but maybe isn't as impactful as we would think?

• 33:55Speaker 02

  Personally, I think it plays a big role. I, you know, the, the nuance to you though is. I think you kind of want all age groups kind of all together. I think that we are today, American politics is just skewed way too old. Like the, the median age is probably 15 to 20 years too old. But, you know, the, the thing that old people bring is huge amounts of experience and like the wisdom that comes with that. The thing that young people bring is fresh eyes, you know, work ethic, energy. Being closer to the technology changes that are happening.

• 34:41Speaker 02

  You know, and just like understanding the voice of, of a different cohort of people. So they're much closer to it. And so I just, to me, if I could wave a magic wand and

• 34:52Speaker 02

  you know, lower our American, say, congresses or this, yeah, the house or the senate's median age by 15 to 20 years. I think that would be hugely impactful. But it's, you know, it's, it's not to say that we don't have some phenomenal, you know, elderly politicians.

• 35:14Anthony Pompliano?

  Let's, um, let's talk SpaceX. Obviously I think people are very excited. It's been, you know, 20 plus years since the company was started. I think that you've invested like a billion dollars in the business. SpaceX is known for rockets. Starlink is becoming a much bigger story. They recently announced direct to cell, uh, which is an entire, you know, concept of like, screw the carriers, screw everybody else. We're just going to go straight from the satellite to your cell phone. How, how do you think about that business and like, maybe what the potential outcomes could be, uh, both in terms of size, but also importance in the world?

• 35:48Speaker 02

  Oh, man. I, SpaceX gets my, my fire going. I mean, it's just such an incredible company and.

• 35:57Speaker 02

  One of the, I mean,

• 36:00Speaker 02

  I just wanna call out from the beginning, you know, one of the things about getting to be a little bit close to the company is you see the work ethic of the team and man, I mean, part of the beauty of having such an exciting mission that's so clearly stated and that is in like for many people existential, you know, like how, I think a lot of people do view going to Mars as a kind of a really important thing for humanity. It's just like the, the work ethic and sense of purpose and that company is unreal. I've never seen anything like it and it and despite what the media wants to say, like it starts from Elon, like that guy is, is a

• 36:40Speaker 02

  he's a, it's incredible how hard he works. You know, I'm thirty seven and I can't, I, I, I couldn't even come close to keeping up with the number of hours he works. It's, it's insane. Um, and so I don't wanna take any credit for what the team is doing or whatever. I, I'm very lucky to kinda get to

• 37:00Speaker 02

  be a fly on the wall and make some money from it, but I don't wanna take any credit.

• 37:05Speaker 02

  For myself and for Sequoia, we've, we haven't really talked about this. It's not a secret, but yeah, we've invested about a billion dollars into the company. The largest investment was in July twenty twenty. So this was kind of when Starlink was like that you could demo, do the earliest demos of the constellation, but it's right before they had any revenue.

• 37:30Speaker 02

  And so kind of the we just, we saw the inflection that was gonna come as they were able to convert this twenty years of potential energy, you know, of, of building like this insane launch platform and now start launching secondary, like very kind of profitable mass consumer businesses on top of it.

• 37:53Speaker 02

  You know, I, some of the things that I, I think are just unbelievable. That, you know, last year, the company put, you know, and Elon's tweeted the numbers, something like sixty, sixty-five percent of all the world's mass to orbit. So if you look at all of the mass from every space program globally, that's both private and public, um, including the Chinese space program last year, SpaceX is about sixty-five percent. This year it's gonna be like seventy-five or eighty percent, you know, in twenty twenty-three. SpaceX is Not had that many really major inflection points in its history. But the company's kind of right at arguably the biggest in its history.

• 38:35Speaker 02

  And so even those numbers like seventy five, eighty percent of the world's mass to orbit in three years when Starship is like really, really working and it's just is flying, you know, a hundred times a year. I mean, it's, it's gonna, the numbers are gonna be really crazy. And so, you know, the, the things I would keep in mind about the company are it took twenty years to kind of build the system that can make the system and to kind of get the company to a very stable, strong place. And now we're just at the very beginning of converting that kind of stored up potential energy to kinetic energy, which will be seen as like uh, revenue, profits,

• 39:20Speaker 02

  just mass scale activity. And, you know, the company's,

• 39:26Speaker 02

  you know, Starlink obviously has still has lots of new markets to launch into. Um, that I, I don't want to say anything that they haven't shared, like, you know, they announced direct to sell two days ago. What that means is like the initial thing is basically for any of their global cellular partners, so like T-Mobile was one of the first in, in the US. Uh, if you're a T-Mobile customer, you'll be able to, if you're, I think, I shouldn't go into the exact details on like how the plans work, whatever, but if you're T-Mobile customer, you'll be able to get Starlink add-on, which will give you no dead zones. So like if you're hiking, if you're, you know, driving and there's a dead zone, it'll,

• 40:09Speaker 02

  the, the network will just kind of automatically spill over from the T-Mobile network to space, like literally your cell service is going to come from, from space. It's, it's pretty sweet.

• 40:20Anthony Pompliano?

  It, it's basically like having a, a consumer friendly sat phone, right? Like satellite phone i- is kind of the, the sense that I get in terms of what I was reading.

• 40:29Speaker 02

  That's true, but um.

• 40:32Speaker 02

  Look, for me, it's it's more just it's more like cell towers in space, you know, if you in the past,

• 40:41Speaker 02

  part of why like satellite, internet and all it has a bad reputation is in the past, basically, all the satellites lived really far away from Earth. They, you know, they lived. I I think it's a factor of a thousand higher orbit than than where Starlink satellites live. The round and the round trip time for a signal to go to one of these satellites and back was about a second. And so you have, you know, latency. There's a lot of loss of like the the kind of the energy in the beam as it's as it's going that long distance. And so like the total bandwidth that you can get to the ground is not that great. With Starlink, you know,

• 41:27Speaker 02

  people will rewrite history, but four or five years ago, people didn't think it was possible to like I when I did diligence on the company, almost every expert I talked to said, it's not possible to have, you know, broadband internet from space at a mass scale where like lots of people can be using it and really, you know, fully power rural environments and have as much bandwidth as they need. Here, like, I I think it's the way I would think about it. It's really like spoofing cell towers in space is really just kind of lifting lifting that some of the ground infrastructure into space and it's low enough, you know, on the order of between four hundred and six hundred kilometers above the Earth that,

• 42:07Speaker 02

  you know, you're just, you're really not that far away. As crazy as that sounds like it's it's really just, it's almost right above us.

• 42:15Anthony Pompliano?

  Yeah, to to me, I think that's what um becomes really interesting is almost uh Elon's learning from Tesla of vertical integration. And, you know, a lot of people, I don't think really understand how many of the parts they make in house and how they've been able to simplify supply chains and just, you know, the more you learn about it, I think you're just like, wow, that's really hard, very complex. But obviously, if you can pull it off, it's super successful. It feels like almost in in a weird way, he is now vertically integrating. Hey, if I can get things into space, what are all the use cases of things that I could do up there? And Starlink seems like a pretty good place to start, but I gotta guess that he is considering, you know, what else could he be doing?

• 42:53Speaker 02

  Yeah, they are. I'm just, you know, I don't, I want to be sensitive to, you know, I don't want to. Step on anyone's toes, but but I do wanna say my mental model for both Tesla and SpaceX is they're like they're each twenty companies in one. You know, like for Tesla, they're obviously they make cars. First of all, the thing that I so I was negative on Tesla like seven years ago. Uh, and it was just a stupid naive argument that all the hedge fund people had, which was, oh, if you add up the market cap of all the automakers, you know, like Tesla's are doesn't even make anything yet and it's already bigger. The thing I got wrong is I'm I'm actually on the board of a lighter company called Luminar that is selling into the automotive industry.

• 43:39Speaker 02

  Um, the thing I didn't appreciate back then is that the OEMs today, like they don't make that much. They basically buy almost all of their parks from a large supply chain. Like, for example, there's a public company called NXP that makes semiconductors for cars. You know, there's, there's like a company in called, there's a company called Aptiv that does a lot like the wire harnessing, so they kind of like harness up all the electric cables, you know, a lot of that's manual. And there's just like, there's all these sub companies, many of which are like large companies. Um, there's also the gas stations, like there's this whole thing, a lot of people are looking at just, you know, the OEMs today basically just

• 44:20Speaker 02

  sell cars, do the financing and like a little bit of the design, they don't make many of the pieces. Tesla is making almost everything. It's literally twenty companies in one. They're making semiconductors, they're, you know, they're making the batteries. They're even gonna like refine lithium, you know, they're, they have the gas stations through the charging network, they have autonomous vehicles, they have like the software, the control systems for the cars, you know, like it's just, they they even have, they make like the speakers for the car, you know, like which is the on and on and on, it's it's twenty plus companies. That also has all this potential upside through things like self-driving, things like Optimus,

• 45:03Speaker 02

  the robots that we're seeing. And so I just had the wrong mental model for the company. And Tesla and SpaceX are very similar to me. You know, like, obviously, the rocket is the core thing. That's, that's the workhorse. But to make the rockets, there's so many different subcomponents. But even to make satellites, like with Starlink, you know, they, they make the engines that power the satellites. So when satellites are, you know, when people talk about space debris,

• 45:32Speaker 02

  in the orbits where Starlink live, you know, call it below 600 kilometers, there's actually still some atmosphere. There's a little bit of atmosphere up there. And so when these satellites are flying, they're actually colliding into, you know, atmosphere molecules, whether it's oxygen or carbon dioxide, or whatever it is, they're colliding molecules. And every time that the satellite collides into one, it slows it down a little bit. And that would cause it to start descending to Earth. You know, it would cause it to fall into Earth's gravity well and ultimately burn up. And so to keep these things in orbit, you know, like with space debris, if you're below 600 kilometers or whatever, where Starlink lives, if you, if you turn off your engine, you will, within a couple of years, just fall into the atmosphere and burn up,

• 46:16Speaker 02

  including all the debris. If, if, God forbid, one were to break and there was a collision. But so, for example, like, they make these engines that power the satellites. And so there's just, it's, they're making the phased array antennas that, that like go into the Starlink user terminals. So it's, it's really just unbelievable. And I think people have the wrong mental model for just how impressive these companies are.

• 46:39Anthony Pompliano?

  How do you guys at Sequoia or just yourself think about some of these new technologies? Right? So obviously SpaceX and Tesla, I think, have become these household names. Obviously Elon, very well known for doing some of this stuff. But you are literally in the business of going and finding the next SpaceXs, the next Teslas. And so like, what are the areas that you're looking for? How do you guys think about, you know, trying to underwrite like, hey, maybe there's innovation happening, but like, is it going to be commercialized? Is there, is there actually a business opportunity here? Or is it more of a research project? Just talk through maybe some of the things that you've learned over time and kind of what that process looks like.

• 47:10Speaker 02

  Yeah.

• 47:13Speaker 02

  So Sequoia is a partnership and it's kind of, this may sound crazy, but

• 47:22Speaker 02

  we, the way I would describe it is it's a bunch of people that are simultaneously, like we're simultaneously a bunch of individuals that are all very, very different from each other and have very different investment styles, investment interests. We're also like simultaneously an incredible team that like really tries to push each other's thinking and really tries to work together and really tries to help each other whenever it's needed. And we've almost constructed our team the way you would construct a portfolio. Like to have a good portfolio, you want a lot of diversification in the portfolio. You know, if you were going to have a portfolio that's 100% AI companies in the year 2021,

• 48:03Speaker 02

  then, or in the year 2023, or whatever it is, like you're so heavily indexed just what happens to AI in that vintage, that, you know, you don't really control what happens as much as the macro environment. And so like for us, we think a lot about portfolio management. And so that means you want some companies, there's like max risk really swinging for the fences. You want some companies that are like relatively straightforward. It's a software company that's already working and maybe the market is capped, but like we're high confidence that it will get to some level. And so we construct both our portfolio and our team with this kind of similar lens of trying to have a very diverse collection of people. And so we all have really different investment

• 48:47Speaker 02

  styles, interests. I am, I'm one of the people on the furthest extreme, if not the furthest extreme of like, I'm a kind of a swing for the fences investor. And, and the way I do that is I like to,

• 49:01Speaker 02

  I'm, there's, there's like two pieces to it. One is, I just try to study All the markets in the world, like all the large markets. If there's a market that has more than a hundred million, a hundred billion dollars worth of revenue flowing in it. Like, I want to know that market. I want to understand that market. And just like already have a prepared mind on how it works. So I kind of, I hold the markets in one side of my brain. And then the other side, I'm, I'm always looking for changes in the world. You know, like, what are the why now? So like, maybe there's some new regulation that just got passed. Or maybe there was just some major, like, you know, major failure somewhere.

• 49:42Speaker 02

  Or, you know, you have decoupling of, you know, China manufacturing and US manufacturing. Or I'm just always looking for kind of the intersection of really large markets that I've already thought about a bunch. And then some, some new why now, whether it's a new technology or regulation or whatever. And kind of that intersection is, I think, when you get the biggest opportunities. Like, that's when you have the swing for the fences opportunities where you really, you might have the first time ever credible path to go, you know, create a space internet constellation. Or, uh, or like, last night I had dinner with one of my founders, Ali Amin Javahery from Node, K N O W D. This is a chemicals marketplace.

• 50:27Speaker 02

  Most people don't know anything about the chemicals industry. I'm obsessed with chemicals industry. It's, there's five trillion dollars a year of chemicals sold. You know, that's about five times bigger than pharmaceutical industry. You know, it's bigger than oil and gas, but no one knows about this industry. It's just kind of like goes over people's heads. And so I had studied that industry for like 15 years, just out of curiosity. And then when I met this brilliant founder that had this kind of crazy insight and he was coming from the industry. I, I had enough of a prepared mind to realize that that might actually work. And that might actually let you go kind of become a large player in this gigantic industry. So that's, that's how I think about it.

• 51:07Anthony Pompliano?

  When you meet these founders, uh, whether it's this founder you're talking about with the chemicals marketplace or others, what are the traits of great founders, right? You know, it's interesting because you've been doing this for a while now. Sequoia has obviously been doing this for decades and probably has a bunch of institutional knowledge of just like, higher probability of successful founder, lower probability. What are some of the things that you all were looking for or try to tease out when you meet founders?

• 51:29Speaker 02

  Number one is probably grit. So it's people that are just never going to give up. Every single startup is hard and has major like trauma that happens. And you know, if you find a founder that will never give up. They're like, if, if, if on average, every startup has four major trauma moments. You find a founder that will never give up compared to a founder who's like fifty percent likely to give up at any one of those four traumatic moments. Then it's like sixteen to one more likely that the gritty founder succeeds simply because they didn't ever give up. You know, probably stick with it. So I just, I think that's number one is the grit.

• 52:11Speaker 02

  And you know, one, there's a lot of things that can signal grit in someone's background. Immigrants are oftentimes have more grit. You know, it takes a lot to pick up wherever you are and like go take a risk, leave your family and, and go start somewhere new. Um, you know, people that have had trauma in their lives oftentimes have more grit. But it's something that's really important. It's a number two is speed. Um. And it's, and it's really not, it's not even about like IQ. It's about, um.

• 52:48Speaker 02

  It's about just like email response time. It's about, you know, time to take a risk, you know, just like ship a new product feature and see what happens. To me, Elon is probably the best in the world at speed. It's part, it's one of his many advantages and he's, he's willing to just like test products in, in public and sometimes it works, sometimes it doesn't, but he gets that data incredibly fast and then can kind of move on. Number three, I would say is, and this is not going to be popular, but this is like, I'd say it's street smarts or judgment. They're kind of the same thing to me.

• 53:23Speaker 02

  Like I'd much rather work with a founder that has incredible judgment, just to kind of always gets the right answer. Rather than someone who, you know, has really high IQ and just kind of is really book smart. I think, I think street smarts are more important in business than, than book smarts.

• 53:39Anthony Pompliano?

  How do you tease that out, right? So I think that makes sense and you know, you kind of look at it as, hey, I'm betting on this person. Everything's going to change around them. They're going to have to really make good decisions to get us where we need to go. But when you are meeting with someone, even if you meet with them, you know, four, five, six, seven, 10 times before you invest. How do you decide whether someone's a good decision maker or not?

• 53:59Speaker 02

  Amazing question.

• 54:03Speaker 02

  It's just kind of an art form. It's kind of a skill. Like I think I'm, I'm not perfect at it, but I think I'm better than most at assessing other people's judgment.

• 54:15Speaker 02

  But I do have tricks for how I do it. Like, like probably the biggest one is I, I rarely invest in people that I've only known for, call it less than a month. I like to know people for at least three months and really watch them operate a little bit, like watch. See if they do what they say they're going to do. See if they kind of chose the right strategy. As the small number of kind of problems arise, you usually don't have like a major problem in those three months. But small things arise and you see how they react to it, see like what decisions they make there. And so, look, I think simultaneously, if I'm being honest, I think I'm just better naturally at assessing judgment. And I get that from my mom.

• 55:01Speaker 02

  But then the other part is, is just kind of watching people.

• 55:06Anthony Pompliano?

  And so as you begin to work with these people, right? What do you see them doing in terms of building company culture that kind of sets it apart, right? So we talked a little bit about Elon and just it's speed. If you read Walter Isaacson's new book about, I'm like, I mean, there's some crazy stuff that they're doing there, right? Literally just like the surges and, and getting people to believe in this big mission. What are some of the things that you all have seen in your portfolio of companies where, you know, you've already made the investment? You already kind of believe in the founder, but you begin to have a deeper conviction like this was a good bet. And we can see the early signs that this company's going to be one of the companies that breaks out.

• 55:40Speaker 02

  Judgment is certainly one of them, which you know, like companies are faced with crucible decisions all the time, you know, not that many, but call it one or two a year. A lot of times there's different magnitudes of crucible decisions.

• 55:54Speaker 02

  And you know, it can be like, someone gives you an acquisition offer. Do you decide to take it or not? It can be, you know, your business, you know, your businesses, we had a plan and it's going pretty well, but then it something happens and, and it's kind of like not working anymore. And you should probably pivot your business a little bit, not like a big pivot, but change like the pricing or, you know, maybe a new competitor enters and they're, they have a free product and, and like they now like it kills your top funnel of new customers. And you have to make a change there. And so I would just say, you can just tell an incredible amount from how founders respond to these early, kind of like strategic decisions.

• 56:38Speaker 02

  Another thing that's funny is a lot of the best founders, there's like a balance, the best founders, you don't want to be too first principle thinking. You don't want to reinvent absolutely everything. But the best founders do reinvent some things, like there, there are some things where they're really stubborn and they'll just do something, you know, Steve Jobs or Elon. Obviously there's certain things where they're just like so dead set on some, they have some vision or they just, they believe something to be true. And a lot of the best founders just have that stubbornness, but then they have to be willing to change their mind when they get data showing that the original kind of vision was wrong. And so,

• 57:24Speaker 02

  for myself, one of the things I do with the founders I work with is I try to explain how confident I am in any given advice. Like, I think that, you know, people will ask me for feedback on stuff all the time. Usually I don't know anything about it. And it's like, sure, I'll give you my opinion, but like, don't take my opinion seriously. You do you, you know, it's your business, you know more. But for every company with, there's probably like one or two things a year where it's like, I have extremely strong opinion. Like, I have been through exactly this two or three times before and.

• 57:55Speaker 02

  You know, and it's it's often non-obvious things, but like you need to hire your first sales rep right now because you are getting product market fit right now. You don't realize it yet and you your plan was to hire your first sales rep in six months, but like you need to hire him right now or her because it's going to take them a couple of months to get ramped and and like you want to be able to service that demand when it comes in and it's it's it's all levels of this, but there's only two or three times a year, or sorry, one or two times a year per company where like I actually have a strong opinion for them and I try to make it clear when it's a strong opinion versus like pulling stuff out of thin air.

• 58:33Anthony Pompliano?

  People always laugh. I say all the time, whenever giving advice, free unsolicited advice, just remember, you know, you kind of get what you pay for. And so, you know, here's my advice. And one, it gets a good laugh, but also two, just, you know, don't put too much weight on it. Because I do think that it's hard to remember, like, somebody else has all the information, right? Like, they were in the room, they saw the eyebrow raised, they got the sense of, same when you were talking about driving through Afghanistan, there's no cars on the road. It's hard to describe to someone, but like, you just know something's up. So it makes sense. The last thing I wanted to ask before I let you go is Sequoia, given that you have so many partners, such diverse kind of backgrounds and strategies and all this stuff, how do you guys make decisions?

• 59:15Speaker 02

  Good question. Pom, you're a smart guy.

• 59:23Speaker 02

  One of the things about Sequoia, there's a meta point here, which is we're always evolving. You know, like Sequoia, part of how we've stayed such a successful firm is we're just networked, super paranoid, we're never complacent, we're always willing to take risk. Like, we view that if we are not willing to change or take risks, then then like, you know, we're just going to lose. And so, as crazy as it sounds, like, even the decision making changes a lot. Like, I've only been at Sequoia for four and a half years, but I've seen the decision making change kind of meaningfully at different points. But I would say some of the like, the core principles are, one, we

• 1:00:05Speaker 02

  We really try to have like ultra direct, honest conversations. Like there's no sacred cows, there's no egos. You should not take anything personally. If someone thinks your company or a company is not working or is a bad investment or whatever, like you. You kind of initially, when I joined, like I took it very personally. But then you, over time, you kind of learn that no, really, this is like feedback is love. It's this is like really just radically direct discussion. So I'd say that's point one. Point two is we really try to change who has an important voice based on what the conversation is.

• 1:00:48Speaker 02

  So like if it's a hardware company, my voice is pretty important. You know, if it's a fintech company or payments company, Rudolph's voice is very important. He was the, you know, CFO at PayPal and on the boards, you know, on the board of Block, for example, you know. Or if it's a like an operations business, Alfred's voice is incredibly important. You know, he, he was the COO at Zappos and, you know, at Amazon and works with Airbnb and DoorDash. He like, he just has so much experience there and with marketplaces. You know, if it's a AI company, Constantine or Sonya or, you know, Pat's voices are really important.

• 1:01:29Speaker 02

  So it's just, it kind of just depends kind of weight someone's voice based on what the conversation is, but not based on age or seniority, you know, like there's some times where it's like the 23 year old analyst who actually knows the most about something and we need to actually be able to elevate them and listen to them. And then the, the last thing I would say is everyone has veto ability over every investment. It's kind of crazy. And one of the things that that leads to is it means, um, there's like a few aspects of it. One is it forces us to make like, you know, to have really intense conversations and, and.

• 1:02:11Speaker 02

  And it kind of gives people the ability to to block things if they if they truly don't think it's a good investment. But it also means like, once we make an investment, if if we if we make an investment, it means that everyone waived their veto. Which means that now it is a team investment. Like, there's no looking back in three years and saying that, oh, man, like, Sean made that stupid investment. What a moron. Like, we should fire Sean. You know, it's it's kind of the opposite. It's like, no, you didn't veto it. Uh, Sean made the investment. He's he is a moron, but you didn't veto it. So you're a moron too. Uh, and so it's not that we should fire Sean. It's that, and maybe maybe they should, but it's

• 1:02:52Speaker 02

  it's just like, this is a team investment. Let's figure out how to make the most of it. Let's work together. Let's not relitigate the past. And so I think that's the kind of the really important, non-obvious part of having veto.

• 1:03:06Anthony Pompliano?

  And I guess as a follow-up to this, like,

• 1:03:11Anthony Pompliano?

  there's a social dynamic, obviously, at play. And there's also this, like, you know, whose voice is more important? Um, how do you use maybe check size to also signal confidence, right? Or is it something where, hey, we want to put, you know, the same check size into every single seed company? And and if we can do that, then that's like better for portfolio construction?

• 1:03:32Speaker 02

  We do have some, we like, we we definitely have some guidelines of what we aim for and what are like the normal strike zones for different type of companies. Um, and we do have different decision makers. So like Sequoia is structured. We have an early team and a growth team. The early team is primarily seed and A. The growth team is, you know, primarily

• 1:03:56Speaker 02

  call it 25 million dollar investments and up. Um, and so so it's it's literally a different set of decision makers. In in reality, there's actually a lot of cross flow. You know, like, there's a lot of people from the growth team that sponsor investments for the early team or or vice versa. You know, like, I'm on the early team, but I led our SpaceX investment, which, you know, is one of, if not the biggest investment. It's one of the two biggest investments in the history of Sequoia US and Europe. And so there really is like a lot of this back and forth.

• 1:04:33Speaker 02

  And we just, it's very fluid. Like at Sequoia, we really try to stay, we have guidelines, but we simultaneously try to stay very fluid so that we can make good decisions.

• 1:04:45Anthony Pompliano?

  That makes sense. Where can we send people to find you on the internet?

• 1:04:48Speaker 02

  Well, my Twitter's pretty spicy right now, so you can send them to my Twitter, you know, @SeanMMcGuire, or you can, you know, my email's [email protected]. And it's on the website. And I think those are my two residents. And when I say Twitter, I should have said X, you know, apologies, X team. You know, still, still getting my head around it.

• 1:05:11Anthony Pompliano?

  I laugh every time I read a mainstream media article and they're like, you know, X, formerly known as Twitter. Like they're gonna, they're gonna do that for like three years. So you're perfectly fine.

• 1:05:22Speaker 02

  I think they might do forever, you know, who knows?

• 1:05:26Anthony Pompliano?

  It's possible. I appreciate you taking the time to do this. I learned a ton. I think a lot of people other will find this very interesting as well. So what we'll definitely have to do to get in the future.

• 1:05:35Speaker 02

  Pom, you are a legend. I appreciate you. Thank you for having me.