[REPLAY] Alexis Ohanian – From Reddit to 776, a Technology Company that Deploys Venture Capital (EP.388)

Alexis Ohanian is the General Partner and Founder of Seven Seven Six, an early-stage venture capital firm with $1 billion under management that he describes as a technology company that deploys venture capital. Alexis was the co-founder of Reddit, one of the most popular online forums in the world, which he sold 18 months after its 2005 launch for $10 million and returned as Executive Chair in 2014 to help lead the turnaround of the business. In between and since, he has invested in early-stage ventures as a partner at Y Combinator, a co-founder of Initialized Capital, and most recently founder of 776. Despite his success in entrepreneurship and investing, Alexis is most well known in the world at large as the husband of tennis star Serena Williams. Our conversation covers Alexis' initial ride at Reddit, taste of early-stage venture capital, and return to Reddit to scale the business alongside the challenges of managing a modern social media platform. We then turn to his investing as a technology company, including Cerebro – 776's transparent operating system, thematic ideas, traits of successful founders, social media engagement, investments in women's sports, and lessons learned from his wife Serena. Learn More Follow Ted on Twitter at @tseides https://twitter.com/tseides?lang=en or LinkedIn https://www.linkedin.com/in/tedseides/ Subscribe to the mailing list https://capitalallocators.com/ Access Transcript with Premium Membership https://capitalallocators.com/signup Editing and post-production work for this episode was provided by The Podcast Consultant (⁠ https://thepodcastconsultant.com/https://thepodcastconsultant.com https://thepodcastconsultant.com/⁠ https://thepodcastconsultant.com/)

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

• 0:01Ted Seides?

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• 0:46Ted Seides?

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• 2:12Ted Seides?

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• 2:47Ted Seides?

  Hello, I'm Ted Seides, and this is Capital Allocators. This show is an open exploration of the people and process behind capital allocation. Through conversations with leaders in the money game, we learn how these holders of the keys to the kingdom allocate their time and their capital. You can join our mailing list and access premium content at capitalallocators.com.

• 3:14Speaker 01

  All opinions expressed by Ted and podcast guests are solely their own opinions and do not reflect the opinion of Capital Allocators or their firms. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. Clients of Capital Allocators or podcast guests may maintain positions in securities discussed on this podcast.

• 3:33Ted Seides?

  My guest on today's show is Alexis Ohanian, the general partner and founder of 776, an early stage venture capital firm with a billion dollars under management that he describes as a technology company that deploys venture capital. Alexis was the co-founder of Reddit, one of the most popular online forums in the world, which he sold 18 months after its 2005 launch for just $10 million and returned as executive chair in 2019. 2014 to help lead the turnaround of the business. In between and since, he's invested in early-stage ventures as a partner at Y Combinator, co-founder of Initialized Capital, and most recently, founder of 776.

• 4:17Ted Seides?

  Despite his success in entrepreneurship and investing, Alexis is most well-known in the world at large as the husband of tennis star Serena Williams. Our conversation covers Alexis's initial ride at Reddit, taste of early-stage venture capital, and return to Reddit to scale the businesses alongside the challenges of managing a modern social media platform. We then turn to his investing as a technology company, including Cerebro, 776's transparent operating system, thematic ideas, traits of successful founders, social media engagement, investments in women's sports, and lessons learned from wife Serena.

• 4:59Ted Seides?

  Before we get going, I hope you're enjoying this Memorial Day in the United States and the unofficial beginning of summer. For me, that means lots of tennis playing and watching the French Open by day and lots of sports watching by night. The NBA playoffs are in full swing, the Yankees' power trio of Soto, Judge, and Stanton are crushing home runs nightly, and Dolan Zverev will have paired off in the first round of the French Open by the time this comes out, and the NHL playoffs are in the conference finals with the local New York Rangers competing for it all. If you're anything like me as a fan, you believe, maybe irrationally, that you can influence the outcome of the game by watching.

• 5:42Ted Seides?

  Some believe it's not true, and it's not the only fallacy that creeps into sports. Klefasnas, fresh off his capital allocator's appearance, penned a brief analysis of the curse of the president's trophy. The trophy's awarded to the team with the best regular season record in hockey, which this year is the Rangers. And the curse is the alleged inability of those teams to win the Stanley Cup. Without diving into details, it turns out the curse is wrong. The best regular season teams still win the cup disproportionately to other playoff contenders, which leaves me with only one thing left to say. Let's go Rangers and Yankees, of course. And that all has nothing to do with spreading the word about capital allocators.

• 6:25Ted Seides?

  But just this one time, you have my blessing to turn off your phone, stop listening and watch live sports. Please enjoy my conversation with Alexis Ohanian. Alexis, thanks so much for joining me.

• 6:39Speaker 02

  I'm very happy to be here, Ted. Thank you for having me.

• 6:41Ted Seides?

  Why don't you take me all the way back to your first entrepreneurial instincts as a kid?

• 6:48Speaker 02

  Hmm, gosh, well, my first would have been mowing lawns around the neighborhood. This was now in suburban Maryland. And as soon as I could push that mower, my dad would pay me an allowance, probably a few bucks to mow the lawn. And I realized my neighbors would pay me more. Sorry, Dad. Shout out to the Fields. They were across the street. The Muths also across the street. And we did some business. So I mowed a lot of lawns. That was really the start of it. Then I went and got a job at CompuUSA when I was 14. And I had this Madonna mic and I'd be pitching the latest computer peripherals and software to a crowd of people who did not want to hear a 14 year old telling them

• 7:32Speaker 02

  about a computer mouse. So I went through the worst public experience hell every 30 minutes as people just ignored me and I'd be like, who's my job to present this mouse to you from Logitech? And I got over so many of my inhibitions around public speaking. That was an amazing job. And I was making websites for strangers on the internet for money. So I was doing that while I was in high school. So I always had a lot of ambition, even at a young age, to just be my own boss and solve people's problems.

• 8:01Ted Seides?

  How did you think about what to do as you went through college?

• 8:04Speaker 02

  I entered UVA Wahooa as a pre-med. I think that's what it says in the first year lookbook. And I bopped out of that within a week. And I was looking for a replacement. And I found this ancient Greek history class, which is relevant now because 776 is named after the first Olympic Games. I took this class. I love this ancient Greek history class so much. I declared my history major first semester, first year. And the dean of the history department was shocked that a freshman would come in there after one semester declaring, but I was convinced I was going to study history. I ultimately double majored and also got an undergrad degree in business from McIntyre. But I was going to be a lawyer because that was what a history major does. And my grandfather was one.

• 8:49Speaker 02

  And I thought I could do this too. And then I walked out of LSAT because I was hungry on Saturday morning to go get a waffle from Waffle House. And that is a true story. 20 minutes in, I just got up and left. And after months of studying for this test, I was just too hungry and realized sitting, eating my waffle, that I probably should not be a lawyer if I wasn't going to take the LSAT seriously. And that's where I decided I was going to engineer something to do after graduation. And that ultimately led to Reddit. And shout out to my friend Walt Eamer, who's the CEO of Waffle House. He put a plaque in at the booth in Charlottesville on Route 29 at that Waffle House where I had this Waffle House epiphany that led to Reddit.

• 9:33Ted Seides?

  So did you not think, hey, I'd go back and take the LSAT on a day where you're less hungry?

• 9:37Speaker 02

  No, because I think it took something about that moment. Maybe it was the realness of taking that LSAT. Studying for it, I didn't mind. I didn't like it. But there was something about taking it and thinking, I'd have to go to school for three more years. It was going to be very expensive. And if I could walk out of that test so easily, maybe I shouldn't make that kind of a commitment. That was the extent of it. And I didn't know what I was going to do next. I just knew. I needed to do something after college and I figured I'd just engineer it myself. So what was that initial origin story of Reddit? It was a way to order food from your cell phone via text message. And so this was 2004 now, I graduated in 05. So there were no smartphones.

• 10:22Speaker 02

  This is era of the candy bar phone or like the Motorola Razr, I think had just come out at that time. Radical new flip phone. And having worked at Pizza Hut through college, I was a cook for a brief period there. And so I was used to these orders coming in through a printer. And they'd come from the front as the servers would input them on a touchscreen. But I realized, okay, well, the output's just a printer. Like you could come up with another input. And my roommate at the time had been visiting, I think it was Sheetz Gas Station where they had touchscreens to order your subs while you're pumping your gas. Felt similarly like, hey, I could just use my phone. And so we didn't have a good text solution for this because the interface in hindsight would have been just heinous to try to text in.

• 11:03Speaker 02

  But I talked to every restaurant on the corner, which was the main strip in UVA of bars and restaurants. They all, of course, wanted to be nice and said, oh yeah, great idea. At the time I was so naive, I thought that counted as business development. I thought like, I'm being a good CEO. I've got customers. That was dumb. And what it took was my roommate, who I'd recruited at this point, Steve's now joined my company. And then his then girlfriend saw that his icon, this guy named Paul Graham, was giving a talk at Harvard called How to Start a Startup. And it was during our senior year spring break. He casually mentioned this to me and I was like, we have to go. And he was like, really? And I was like, yes. And I think this is the sort of gift and curse of my personality.

• 11:43Speaker 02

  I also couldn't imagine any other thing we could do on senior year spring break than go to Boston and hear this guy give a talk about startups. Cancun was just not on my horizon at that point. And so we go up, we hear him speak. I pitch him afterwards on the business idea. Actually, I pitched him on taking him to coffee to pitch him on the idea. I think he was surprised we had come all the way from Virginia and he said, sure. Met him that night, pitched him on this idea. It was called My Mobile Menu or M for short. And he said, it was a pretty good idea. He actually got really excited about it. He's like, phones are going to be the future of ordering. Won't have to wait in line again. We then, a month later, applied to Y Combinator, which he had just started, first ever batch. And back then, it was $12,000 for 7% of your company.

• 12:28Speaker 02

  And we got rejected. And I really thought the pitch was good. But this time, we did it with the rest of his partners. Actually, that night, he called me up and said, hey, sorry, it's not gonna happen. And he was right. The tech wasn't there for phones. It was still like a kludgy user experience to try to text and try to get the order right and think of all the menu nuances. And restaurants were notoriously hard to partner with, especially in 04, 05. But the next morning, he called back and he said, listen, we don't like your idea, but we like you. So if you were willing to switch your idea, we'll fund you. Immediately got off the Amtrak somewhere in Connecticut. And I talked to the nice lady at the station to give us a free ticket back to Boston. And we met up with him and sat down. And he just started asking us questions. And what we eventually got to is this idea of creating the front page of the internet.

• 13:13Speaker 02

  And give Paul credit for that tagline. I took the check from him, $12,000. And we were off and running. And then we would graduate a few months later and move to Boston to spend the summer building. How did you think about building an audience? It was grueling. In 05, there were no social media websites. So remember, this is before Twitter, before LinkedIn. The extent of it was Facebook, which was still in colleges. MySpace, Friendster were already on the decline. And blogs were actually the dominant UGCs who generated content of the time. So building an audience involved me cold emailing a ton of bloggers to say, hey, look, I'm Alexis Ohanian. I founded this company, Reddit.

• 13:58Speaker 02

  We think we have an interesting approach to helping people find what's doing interesting online. You may wanna submit some of your articles there. Maybe some of your fans already have. That was even better when I could find one of their articles that did well that someone had submitted. It's a great way to open an email, which is like, hey, 50 people have upvoted your link on Reddit. Now, they didn't know what the hell that was, but it felt nice. And basically, tried to get them to do an interview with me about Reddit. In 05, 06, you'll see all these random bloggers who have written articles about Reddit. And this was the main way we would appeal to them. And the way we would grow the fanbase. I had run a forum, a PHPBB forum in college. Probably had about 600, 700 members. Those were the first people I emailed to say, hey, try this new thing out.

• 14:41Speaker 02

  Reddit in a lot of ways is just the modernized forum software. And we got some early users that way. Paul Graham mentioned us in one of his essays. That was the first big pop. But we're talking on the scale of thousands of people, not what folks are used to today. But the most important thing then was showing up in the comments. And for years, I, or Nothing is my screen name, was one of, if not the most prolific users of Reddit. Being in the comments, starting conversations, responding to people, it was almost like being a party host offline. We can sort of imagine what makes a great party host. People take for granted. It actually works the exact same way online. You have to do that same kind of work. Now, the benefit is if I host a bunch of great people here, the only people who are going to enjoy that experience are the people who are here in that moment.

• 15:26Speaker 02

  If you're doing that exact same thing figuratively online in a community, a subreddit, it's not just the people who are there in the moment. It's for decades later, everyone who stumbles on that thread or finds it in a search result. And so the scalability of doing that, really blocking and tackling and community building is so much better and stronger online. And I think I had enough instincts, just because I grew up on the internet, that it worked. So what happened from there? I went through the most formative 16 months of my life. I had just a few months into founding Reddit. My then-girlfriend had a pretty bad accident while she was studying abroad. A few months after that, my mom was diagnosed with terminal brain cancer.

• 16:07Speaker 02

  It was one thing after another to go from feeling like an invulnerable 21-year-old CEO to a very different perspective on life and purpose and all those things. And so at the same time, this was the only thing I could do to escape from that was work. And so that's what I did. I probably should have seen a therapist sooner. But it was what I poured everything into. And I knew deep down, because of the support of folks like my mom, I knew I was going to be successful. It sounds very irrational, but I was like, she's been such an amazing force my entire life and continues to be now even more supportive in the face of her own horror and so stoic and so supportive. I gotta do this. I gotta make this work.

• 16:49Speaker 02

  For her, not even 10 months in, we're out at Google's headquarters and Chris Sacca, who's gone on to be a prolific investor. He was the right-hand Larry and Sergey at the time. I had sat next to him at a dinner and a month later found us invited out to Google. And so Steve and I were there, meeting with everyone. It actually made us an acquisition offer. It was like an acqui-hire type thing and Google wanted to roll Reddit into YouTube and they were going to make us the sort of YouTube commenting system. It was one of the ideas they had, which is surreal to think about now. Not long after that, for all kinds of reasons, I found myself at Paul and Jessica's house because they pulled me aside and they're like, hey, look, if you can find a way to sell this company, it's gonna be a great outcome for you, for everyone. I just didn't know anything about management.

• 17:34Speaker 02

  I didn't know anything about how to build a team. Made a lot of mistakes. And a conversation I was having with the head of BizDev at Condonast, this guy named Karoosh Karamkani, who I had met through a reporter who had interviewed me, who then pitched her wife, who was an editor, who happened to be married to Karoosh. He said, hey, I really like what you're doing with Reddit. Let's do a little licensing deal, which ended up being a prelude to an acquisition offer. And then, yeah, $10 million acquisition offer for 12 months worth of work at the time. We got it consummated in about four or five months. So 16 months in, it was just mind blowing. This is life-changing money for a year worth of work. This is insane. I thought I was getting away with something. And Paul and Jessica were really earnest about seizing the opportunity. So we did.

• 18:17Speaker 02

  I spent three more years as Condonast, as a, I had a product within Condonast, which is not where I was long to be. And then one thing's ended. Actually joined YC, tried starting another startup, Hitmonk, then eventually found my way to venture capital.

• 18:30Ted Seides?

  So how did you turn from building up Reddit, selling it, spending some time at Condonast to investing?

• 18:37Speaker 02

  Paul and Jessica, again, shout out, had invited me, I think it was in 2010, once the handcuffs came off with Reddit, they invited me to come out and play a role at YC. And I wasn't ready to move. I was living in New York. I love New York. I was born in Brooklyn. But they engineered a role for me as this ambassador for the firm. So then part-time partner, then full-time partner, and I eventually started moving my way out west. But that was when I first got under the hood on the other side of the table at Combinator, starting to see thousands of applicants every six months, reviewing them, interviewing founders, accepting them, working with them. I didn't fully appreciate just how big YC was becoming

• 19:20Speaker 02

  in terms of its impact on the ecosystem, because Reddit was such an early, small exit. But it was the first validating one of that first batch. This $10 million exit was the first really big one for YC. And it helped give a seal of approval that then led to Dropbox applying, which was the first real billion-dollar company, and then that led to Airbnb. Once you did it twice, it really validated YC as a model. And so getting to see that from the inside was eye-opening. Paul Graham had built just a little bit of software to manage office hours and applications. And it was just enough, and I think in part because of Paul's distaste for management and people. He built a software to handle a lot of those things.

• 20:01Speaker 02

  And there was something to it that I thought was phenomenal, because it was able to scale a process pretty darn well. And then it wasn't too long until 2011, 2012, when Gary Harg and I actually got approached, so all three of us were partners now at a time at YC, got approached to actually raise a fund. We hadn't had the liquidity events of, say, Paul Buchheit. And so we were doing small check. I was doing small checking, little investing, 50K type checks. And we got approached to basically invest other people's money. And that was the first time I'd even considered, oh, I could be a VC. There was no looking back after that.

• 20:36Ted Seides?

  So what happened with that first little fund?

• 20:38Speaker 02

  Well, I can't talk specifically about it, but we ended up making some sound investments very early in companies like Coinbase and Instacart. I think I also invested in Reddit when we took it out independently. Reddit was also in that fund. Yeah, it was some good early stage investing.

• 20:53Ted Seides?

  So when you stepped back into Reddit a number of years later, what was the platform at that time?

• 20:59Speaker 02

  Well, the previous CEO had just defended revenge porn a few months earlier in the name of free speech, and that was one of his last acts as CEO. Not surprisingly, one of the first things that happened after I came back was banning revenge porn, which was a pretty obvious thing to do. But it was a company that had, I think, $8 million in revenue that year, 2014. That's public despite being over a decade old and dropping because obviously advertisers don't want to be on revenge porn websites. And so maybe 40, 45 employees, no mobile app, which was gut wrenching because I designed and shipped an iOS app in 2009. It was called iReddit, and it's supposed to be Reddit on Reddit, like I read it on Reddit. That's why I named it Reddit.

• 21:43Speaker 02

  And so I shipped this iOS app, but then I left six months later, a year later, and so it died. And it killed me because here I was, five years later, we still didn't have a true iOS Reddit app. And unfortunately, the culture had metastasized around this idea that desktop web was the only thing that mattered, which was sad because even in 2014, it was obvious that mobile was here to stay. So there was a lot of product to catch up on, a lot of business to rebuild and a team to rejuvenate. And I was very lucky about a year later, we're about 60, 65 people at this point, hired Caitlin Holloway as our first ever head of people and culture. And she really just rejuvenated everything, taught me so much about management, scaling an org. Four or five years later, when I stepped back to a board only role, I think the business

• 22:28Speaker 02

  was probably 175 mil in revenue, probably like 500, 600 employees. So grown a lot, learned a lot from that. And then Caitlin eventually came and joined me on the dark side of venture capital about a year later. But it was formative as hell. And so that's the other big window of time where I learned so much about how to actually build a real business, how to even think through building a performance culture, executives, all those things, all those dynamics. And thankfully, we got enough things right.

• 22:57Ted Seides?

  What were those one or two key lessons you learned about management?

• 23:01Speaker 02

  Oh, number one, and this is something we'll coach CEOs on now. If there are really systemic challenges with an employee and you give that direct feedback and you don't see material improvements and you keep going through the same process quarter after quarter after quarter, it's not actually going to get better. You've got about six months really to get them ramped up, moving, see the full output. And if things aren't hitting expectations, it could be because maybe you leveled them improperly and they're not quite the right role. But if they are struggling in key ways and you give them that feedback and you give them another quarter to work on it and you don't see enough change, after another quarter, it's basically time to make the move. And that is one of the hardest things in the early days of a company.

• 23:46Speaker 02

  So much of your success comes down to the team that you build. And one of the hardest things first time founders and CEOs have is around performance management, whether that's giving negative feedback, which is also a gift if done well and really important, but then also moving on from folks and doing separations. And those are muscles you have to exercise in the gym. You cannot just read about. And hopefully you've got good partners around, you can help you think through this stuff, role play this stuff and whatnot. This is something we try to provide for founders ourselves, but it's something that especially for early stage companies, it's just so important. There's just no room, you're looking at maybe two years of runway, period, until your next raise. It's really in everyone's best interest to not try to make fetch happen, so to speak.

• 24:31Ted Seides?

  What did you learn about giving feedback effectively?

• 24:34Speaker 02

  Really great feedback is fast. It happens pretty quickly after some incident. It is direct and it is compassionate. Ideally, create a culture and create an environment where you're attracting the kind of folks who are going to thrive with feedback. The good news is, In many high-performance cultures, there's a high correlation between folks who are high performers and who love feedback, especially this kind of feedback when delivered well, because they want to get better. They are endlessly searching self-improvement. So if you can, first and foremost, try to build a culture that attracts that, then okay, you're delivering it in a timely manner that is compassionate, it's not hateful, and also is very specific and speaks to the actions or the things or the work that need to improve.

• 25:18Speaker 02

  And bonus points if you are able to offer even suggestions or insights. But that is an exercise that Caitlin put me through seven years ago, and I cannot tell you how many times I come back to it when trying to deliver feedback, even to my kids. I don't know if that's healthy, but I bring a lot of these management principles home. So we'll see how it turns out, the little ones.

• 25:38Ted Seides?

  When you took this thing from eight million revenue to 150 in just a couple of years, what did you see differently in terms of your ability to scale and grow than when you were around the company the first time?

• 25:52Speaker 02

  Well, I have to give a lot of credit to the folks who did the real work building that. And the good news is I work with some of them today. Our team president at the LA Golf Club, Neil Hubman, was our head of sales there at Reddit during that entire time. In fact, he came on right around the time I did and was at the company up until a year ago when he joined us at LA Golf Club. And so you've got folks who were in the right role, executing the right way. And frankly, as bad as Reddit looked with that eight million revenue and this revenge porn branding in 2014, folks who could see past that saw tremendous potential.

• 26:36Speaker 02

  I mean, we did have eight million in revenue, but it was so notoriously underperforming for so long that it's not like we were just starting there. We had an audience that already should have been generating way more revenue. We had engagement, we had cultural influence that should have been way more valuable. It was just being under managed, let's say. And so what I saw there that most impressed me, though, was if we could attract folks who saw the potential, who were willing to... Run into the burning building and basically say, no, no, no, there's something really special here. We can save this and this can be a career defining opportunity for me. In a way, because it was so unattractive, I think we also just automatically separated out a lot of folks who wouldn't have been the right fit.

• 27:20Speaker 02

  So I'm not saying make your business look as unappealing as possible. And what was so compelling was just by creating a modern philosophy around how to treat employees, how to reward employees, how to build culture internally. In many ways, frankly, reset a culture was really exciting because then I started to see how, something I never took seriously, like values. I always thought company values were just bullshit people put on a wall. And plenty of places they are. At the best performing companies, they really are an extension of the founder. At some point you grow so big, or even it doesn't take that long. You cannot be a part of every decision. You should not be a part of every decision.

• 28:04Speaker 02

  And so these values, when well articulated, are a way to scale as if you're in that room. And then what was also so interesting is I watched as they also evolved. We would do these audits every year where we'd look back and say, okay, these values that got us to where we are now. Look at where we were a year ago. Do we still need all these? Should we evolve some of these? Because now we've actually accomplished that thing. We wanted folks to take pride in the work they shipped. I stepped into an organization where we were frankly, just shipping product that wasn't great. It was really, really important that we shipped not just often, but also well. And we took pride in our work and that needed to be a value. This idea that folks would almost figuratively have to sign their name on the things they were putting out in the world. And if you didn't want to work in a place where you had to stand by your work, that's fine.

• 28:48Speaker 02

  You should just do that somewhere else. And after a year or two of doing that, I remember Caitlin saying during one of these off sites, look, we've reached a place now where I feel like we don't need this value anymore. What do we all think? And how do we evolve that as an executive team? To see those things evolve, to see it when it's done well is so powerful. Because I think to do really hard, big things, you need to find ways to scale that limitless well of founder energy. That's unfortunately limited to 24 hours a day and usually just a few humans.

• 29:18Ted Seides?

  Once you get that internal flywheel going the right way, the right people on a platform like Reddit, you also have the challenges of the external environment. And it's not just Reddit, the social media. You mentioned revenge porn, you've got harassment and hate stuff. How did you think about? All of those issues, and it's obviously broader than just a Reddit issue.

• 29:40Speaker 02

  The internet, frankly, that I spent my childhood growing up on always had its weird, dark, awful places. But the community platforms that existed that by and large defined the internet in those 90s and early aughts. The number of people online, especially online a lot, was far, far, far, far fewer. It was a smaller sampling of the world. And I think all of us, and I'd say all of my peers in the social media world, all those other founders and CEOs. We had rose tinted glasses on because, yes, we all were white dudes. That's worth stating. We just didn't encounter much awful content in general. The forums were smaller, the topics were web design forums.

• 30:24Speaker 02

  This stuff existed, but it didn't metastasize like it does now because the internet is so ubiquitous, because social media is so ubiquitous. What happened on the internet did not become news globally that same day. So it wasn't something we thought about from the jump. And frankly, in the early days of Reddit, if there was something really awful, hate speech, whatever, we would just ban it outright. Because we were the mods effectively of the handful of communities we had. But as the platform grew, we had to build more of these tools to help our moderators do that job. And then part of the challenge also frankly was leaving in 10, coming back in 14. That was a four year gap where we were now going to play catch up on a lot of things that I could say maybe I would have done earlier.

• 31:06Speaker 02

  And then we all saw more and more people moving online, spending more of their time online in the teens. Now, here we are in the early 20s where truly culture happens online. That is the first place where this stuff happens. I don't want to say everyone, but it's a whole hell of a lot of us spending a heck of a lot of time. And we're seeing now more and more of the negative consequences of that prolonged exposure. And look, there's philosophical disagreements, of course. I mean, I left Reddit pretty publicly in protest back in 2020 in the wake of George Floyd because it did not align with my views that the company would take such a stance in support of communities of color and black communities in particular, and also still have thousands of hate communities.

• 31:50Speaker 02

  And when I brought this up, similar to protests I had about some of these extreme violence communities, like watch people die. I was in the minority on that board. And so. It was important to me to just get aligned with myself and challenge the company to ban those communities once and for all, which they did after I resigned, and replace me on the board. And I think private companies, I think of it like Javits Center. We're here in New York. If you've been to a Comic Con there, you've been to an event there. Javits is a convention hall, pretty big, that is effectively privately run. It still exists in the United States of America, which is a country that honors free speech, and it's an awesome right. But if you're in the Javits Center, it's a private enterprise. And so

• 32:34Speaker 02

  Javits has every right to say, yeah, sure, you want to host Comic Con here, great. But if you want to host your KKK community here, we're not going to allow that. If you just take it out of the online world, there is something insidious about this idea of seeing a Pokemon next to a KKK booth. It almost normalizes very, very heinous behavior. And look, the World Wide Web still adheres to these principles of free speech. You can still find those communities online. I think I actually, although I find them vile and disgusting, I understand why they need to exist on an open internet. The difference is, pre-social media, they all existed in their weird little vacuum. And the only way it really metastasized

• 33:17Speaker 02

  was if some person you knew sent you some email that was like, hey, check out this website. And you'd very quickly be able to be like, you're weird? No, thank you. But social media unfortunately gamifies this outrage that actually helps the most outrageous content metastasize and spread a lot faster. And so here we are in a place where I feel, yeah, if you are the owner of the digital Javits Center, you actually can absolutely decide what communities belong and don't belong. That's your right in America to do that. And I think things get a little convoluted when we muddy the discussion with the public square. Because if we're using the public square metaphor, that implies that these websites are cities. If there's a public square, some kind of digital towns. Who decides

• 33:59Speaker 02

  who the leader is of the digital town? The board? So it's not a democratically elected leader. It is a digital town square in a city that is run by a dictator. That its citizens have no lever to battle with. And what's nice about a democracy is, yeah, we can have that literal town square where we have the ability to exercise free speech, but we also have this amazing set of levers from the founding fathers that allow us to vote and make decisions if we don't agree with something to make change. And so that's for me where the digital city metaphor falls apart. So all this is to say, the most encouraging trend I've seen of late, and I think AI is actually going to help usher this in. AI and the glut of AI-generated content is now

• 34:44Speaker 02

  going to make proof of humanity much, much more important for UGC websites because it will be really, really important, not just to keep down spam, but because users presumably want to see what humans have to think. And I actually think this wave of proof of humanity that consumers are going to ultimately demand is going to lead to a better quality of conversation on the internet. I don't want to get rid of unanimity, let's call it. It's not pure anonymity. I think Reddit works because you can choose a username and Fluffy Bunny 12 is still an identity. So it doesn't descend into total chaos because you actually have accountability. You get the freedom to be, let's say, more honest than you would be on your Instagram, but you still have the accountability where

• 35:26Speaker 02

  you have an identity you actually care about. And Fluffy Bunny 12 still matters in a way that if you were purely anonymous, it wouldn't. We're going to see a shift and Gen Z seems to be leading the way in terms of not wanting all of their lives digital. I just saw this uptick in dumb phones now in the United States. So the United States is one of the few countries in the world where we're actually seeing a rise in the sale of dumb phones, which I can't help but feel is a part of this culture of, hey, the pendulum swung so far on user-generated content and living on our phones that perhaps there's some energy now swinging back.

• 35:58Ted Seides?

  So I'd love to shift a little bit. You've had your operating experience, a little bit of early venture experience, and now the platform and some views. I've met a bunch of different things into a venture capital firm. Would love to hear how you thought of bringing all this together in what you've tried to do at 776.

• 36:17Speaker 02

  For sure. I saw firsthand.

• 36:21Speaker 02

  The power of designing community software, Reddit, and I saw the opportunity in early-stage venture, building initialized. And in 2020, I realized that if I was going to do my life's work, it would be building software, which I've called Cerebro, which is a deliberate X-Men reference, to be a full-fledged operating system to run a venture capital firm just better, cheaper, faster than anyone's really done before. I love building software. I love building community. My partner, Caitlin, who founded the firm with me, like I said, she obviously deeply understands both community, online and offline, from our days at Reddit. And so we're taking a unique approach. We've built Cerebro to be, and this is where we do all of our work as a firm.

• 37:05Speaker 02

  We do a tremendous amount of our founder's support through it. A lot of it is self-serve. I don't want a founder to have to ask me, "Hey, who do you know at insert company name?" Because that's a bad query for my brain to figure out. I talked to all my billion-dollar CEOs, the seed investments that had grown up, and I said, "What was the most valuable thing that I did for you?" And one of the top results was, "Oh, intros, your network's strong. People take the intro." It was tremendously helpful. And I realized, I sorted that list of things, and at the top of the list was what was most productizable. And what I realized was here was the perfect thing. My brain, not a very good database. A database is a very good database. And so that simple query of, "Hey, who do you know at company X?"

• 37:49Speaker 02

  is trivial if it's all living in software and it's searchable by founders. It's a pain in the ass, if you're asking me. It's also a waste of everyone's time. So that was the very first tool we built in Cerebro, which I took about 40,000 contacts that I'd amassed in a personal CRM over my career, made it searchable, and then let founders click a button to draft an email for me to basically edit and approve and send that would come from my inbox. And that was V1. And we've since built a whole full-fledged product suite. It's tremendous. And then the other benefit of doing all of our work in software and scaling, now there's four investing partners, is

• 38:27Speaker 02

  The exhaust of that engine is data. And so, over the holidays, I got a little frustrated because I was browsing other firms' websites and I realized every single VC firm, all these early-stage VCs, all the same promises on their website. And I thought, well, that's not differentiated. And I thought, worse, the very best founders don't want to hear promises. They want to see receipts. So we just built the 776 website. So now it has real-time data. So in the last 365 days, you can see our median response time to founders. I think it's like 1 hour 24 minutes. The number of intros we've made, workshops we've hosted, sales meetings we've had, even the user engagement of Cerebro, the app that we've built, not just of our team, but also how often our founders are using it.

• 39:11Speaker 02

  And so by putting a scoreboard, which we've always had internally, but now putting it externally, I just wanted to make it very clear to the world that we are built very differently. We are more like a technology company that deploys venture capital than anything else. And God help someone who's going to compete head-to-head with us on a deal, who's going to say, "Oh, you should take our term sheet. We'll help you a ton. We'll be super responsive. We'll help you with press. We'll make lots of intros." Because that founder's just going to pull up the website and say, "Well, show me the receipts because these guys actually have data for all the things that you're promising me." I don't know what your answer is to that. Do you tell your poor admin to go harvest your calendar for the next 24 hours? But it's exciting.

• 39:53Speaker 02

  This is the kind of accountability the best founders expect. This is what they expect to provide their investors. And I think it is a great time when investors are now looking to have a similar kind of accountability to their founders.

• 40:09Ted Seides?

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• 40:52Ted Seides?

  So that aspect of operationalizing how you work with your portfolio companies has to come after you've found the portfolio company. So if you circle back to the top of the funnel, what is it that you're looking for?

• 41:06Speaker 02

  We are generalists and so I think I've benefited through my entire investing career and probably frankly, in building Reddit, from being pretty intellectually curious and promiscuous. And so as a result, I have a really broad network. You got to imagine being a first check in companies ranging from Coinbase and Instacart to Patreon and Row and Flock Safety, a variety of different industries, very different backgrounds. So much of what is at the heart of Cerebro is network. The first product was just those 40,000 contacts I had in my own CRM. And so we're very cognizant of the relationships we're building, wherever the most signal is in our network.

• 41:49Speaker 02

  A lot of VCs, so much of our deal flow still comes through recommendations of folks in our network. There's a lot that just comes in through the front door in the inbox, but there's a very, very significant number that come through some warm recommendation from someone that we've worked with or invested in before or what have you. And that still ends up being a really dominant force. And that starts to guide a lot of how we think about the world. When we just want to get smart about a sector. We made our first ever space tech investment in our first fund, a company called Stoke. And they are a couple of ex Blue Origin folks building reusable rockets that will, the second stage, the little, the top will land itself. Amazing team on paper. I have never built a rocket before.

• 42:34Speaker 02

  I can evaluate most of these technologies pretty quickly if they're software, but this is very hard hardware. But we got to conviction, we did the investment, that company's been tracking well. And so now that opens the door to a whole nother network of space tech founders through a really credible CEO. And that's opened the door to companies like Astroforge. And so we're going to see more of this. And what gets exciting is we get to spend time with actual builders on the cutting Edge of tech, they teach us what's happening. We get to conviction about spaces or sectors. And then we've got some of the biggest reach in venture on social. I'll literally tweet out something I'm excited about or confused by.

• 43:16Speaker 02

  And start to get a trickle and then a stream of pitches around that. And that's also tremendously helpful. We haven't announced the, we just invested in a company. Based on a tweet that I made a year ago about fixing the American food system. Because we saw vertical farming boom and then crash. And there were parts of that business model that made a ton of sense. A lot of other parts that didn't, at least for venture. And I was desperate to figure out what the next version of it was going to look like. And I think we found it, we ended up investing in it and it all tracked back to a tweet. So it's a mix of things, but Paramount is surrounding ourselves with high output, high horsepower founders.

• 43:54Ted Seides?

  There's three aspects of what you do that have come up in that thread. So one is the tweet, your social media presence. Another is the sort of conviction in ideas. And then the last is founders. Maybe start with this question of the idea and the founder. And how do you think about the intersection of the two?

• 44:13Speaker 02

  We have a deal tracker in Cerebro. And when a company goes to the pitch stage, anyone who is in that meeting gets a notification that they need to go grade the founder. They're grading the founder on a number of different criteria. The most, most, most important one is around the founders themselves. So some personality traits that we look for. Then there's the more standard stuff around product, market, timing. Those are all important. Oftentimes they're usually just reflecting back on the founder. If the product is poorly built or has no taste, it's a reflection of the founder. If the market opportunity as presented to us feels off or we're going to get 90% of the whole market audacious, again, it's a reflection of the founder.

• 44:57Speaker 02

  The timing one is an interesting one because gosh, I mean, I guess I was a victim to it with my mobile menu. Obviously smartphones have solved the problem of ordering, whether it's to skip the line or just get delivery. But the timing was off and I'd like to think I was a good founder. I just. Got the timing wrong and that's the one that can stymie a company will likely still invest because it's something very hard to time, especially when we're the literal first check in a company. So it won't seem obvious to the rest of the world for maybe three to five years. That's part of the fun, frankly. I'll tweet about investments I've made. March of 2019, I am probably one of the few people in the world, certainly in venture tweeting that women's sports was the most undervalued opportunity in the world and I was going

• 45:41Speaker 02

  to buy an end to be a self team. I had so many people tell me how wrong I was and how much money I was going to lose and Angel City has done pretty well since that initial check. And this is part of the intuition I want to build for the rest of the investment team who has not as much experience as me, but a whole lot of it is what we're looking for in founders who are capable of building these multi-billion dollar companies. There are these traits that I keep circling back on that seem to just be more and more important as I reflect on them. I assume you want to know what they are. Sure.

• 46:14Speaker 02

  So at least one of the founders has to be a good communicator and that's not necessarily charismatic or can get up on a stage and give a TED talk. They need to be able to one, understand their idea, communicate it in a simple, effective way, and then also just be able to synthesize what is going on in the broader world and then specifically who they're talking to and be compelling. And so that might be pitching us as investors. That might be getting someone to quit their job to come work for them, to be one of the first 10 employees of a startup. Very risky. It might be convincing someone to buy their software. Maybe it's a B2B sales business. And at least one of the founders needs to

• 46:59Speaker 02

  be a very compelling communicator. There's this je ne sais quoi around it. There are traits you look for. They're probably not using a lot of jargon. They can speak plainly and confidently about what they know. And it's such a nuanced thing, but that one seems to be over and over again, one of the clear differentiators. There's another one around resilience that we look for. And again, that's a hard one. You can't ask someone, hey, tell me your most resilient time or are you resilient? Yes or no. But you look for things that they've built or done in the past. This is going to get hard. Starting a startup, the moment you're meeting me, this is literally your first check. There are much better ways to spend the next decade of your life if you want to make money. I try to talk people out of starting a startup all the time.

• 47:43Speaker 02

  As much as I try to broadly encourage people to consider starting a startup. I also want to just say gut check, do not do this for wealth. Do not do this if you're just trying to make some money because there are smarter ways to do it. Do this because you lose sleep at night because this thing doesn't exist. And you want to bring it into the world kicking and screaming, knowing that it will suck for extended periods of time. And you're going to have to be the one to pick yourself up. Don't even count on your co-founders. Don't even count on your investors. Don't even count on your friends and family. It will be on you. And if that is a road you want to go down, if you want to chew the glass and stare into the abyss, then okay, great. We need people like you, but try to talk folks out of it. So these are the elements that we look for.

• 48:27Speaker 02

  And what's so fun about this gig is whether it is a crypto company or Mr. Beast's company, or whether it's a space tech company or a climate tech company. No matter the sectors, those attributes carry over from CEO to CEO to CEO. And it's fun because these are not folks who are inheriting someone else's company. I don't think I could do any other part of this job of investing well. Certainly not nearly as well as I can the early because it's a kind of alchemy that I'm just looking for something very different than, for instance, if I did public market investing,

• 49:10Speaker 02

  where it's either entirely data driven, or maybe there's some other magic to it. It's the alchemy of early stage where you can literally spend 30 minutes with a person who has only an idea and say, yes, actually, this can be a multi-billion dollar business. And thank God for the power law. You don't have to be right even half the time. You really just need to be right once or twice out of a fund and get some great returns.

• 49:33Ted Seides?

  A lot of people finding you with ideas.

• 49:37Ted Seides?

  Can be tied to this massive social media following that you have on Twitter, on Instagram. How have you thought about putting your time into those platforms and what it takes to resonate and build an audience?

• 49:50Speaker 02

  I have done a terrible job building my audience. And I know you're gonna be like, well, but you've done a pretty good job of it. I look at full-time content creators like Jimmy, my friend Cleo Abrams, she's got a few million on YouTube. She does these amazing explainers about hard tech. It's called Huge If True. And so I see the work that they do. It is a literal full-time job making content. You know this, Ted. It's a lot. And if you want to do it well, you gotta do the work. You gotta get the reps in. And so we're getting better now, in part because I've got a team and they're not just scaling me for content, they're also scaling my partners, because this isn't just the Alexis Show. And then you know me, I love software. So I've built more and more software to help us do this better, cheaper, faster. We've built our own version of it into Cerebro.

• 50:33Speaker 02

  And so this lets our content team, but also our founders, ghost-write entire tweets, LinkedIn posts for us. So again, we're finding these efficiencies where now I can just get a push notification and be like, oh, here's a post, it's already scheduled to go, let me hit edit. Yeah, looks good. Let me add this emoji. Boom, send. And again, creating all these efficiencies, that also lets us report back number of impressions, number of engagements, click-through rates if there's a link. We also then just shipped an app called Muse. Well, really, it's a feature within Cerebro, inspired by Cameo or Fourth Wall, where our social team, even our founders, can basically ask us for a selfie video or audio with a prompt.

• 51:16Speaker 02

  It's just like you might pay some C-list celebrity to make a birthday video for you. Our founders can do that, or our social team can. And so I'll get a video that's like, hey, let's talk about Kaitlyn Clark's record Nike deal and how it affects the future of women's sports. And I get that prompt, I see it on the screen, I record that video and under a minute, I hit send, I don't think about it again. And whether it's the founder who requested it, or our content team who requested it, they get it. They've already got the transcription, they've already got it closed captioned, they can now just do a few edits and boom, it goes live on social media. And so these are all tools that we build because we reach this pain point. We're doing the thing so much and there's so much friction in it that could be solved with software that I just put it on the product roadmap.

• 51:59Speaker 02

  And this is fun because I think content creation is only going to get more important. We talked earlier about the AI wave. I think of the world in barbells a lot. And so as it gets easier and easier to create AI generated content, there's going to be a ton of it, tons, and it'll be really good. But because of that, you can just imagine a glut of this content culturally, we'll get used to it. If you told me five years ago that we would have a spidey sense for, oh, that looks AI generated, now you find it everywhere on social media. There's definitely a Facebook demo that is getting duped on the daily, which is hilarious. But if you're a sophisticated internet user, you're like, something's a little off. So it's already entering the culture.

• 52:43Speaker 02

  And I think that other side of the barbell, where again, proof of humanity will really matter. I think in a world that's going to be awash in content, standing out as human, almost intentionally so, is actually going to have more value. I think in a world where there's just so much of that stuff, it actually matters more to be an original content creator. Build that following, which will let you break through the algorithm and give people a reason to pay attention to what you're saying.

• 53:08Ted Seides?

  I'd love to ask you about one of your investments on that other side of the barbell. Brent Montgomery introduced us, I know you partnered up with him in this mental collectibles business. How does that fit into your view of the world?

• 53:22Speaker 02

  Well, a couple areas. Obviously inspired a lot by Reddit. Six years ago, when I got back into the hobby with trading cards at first, and then game worn collectibles, video games, all these things. A buddy of mine was like, it's back. And if you want to know the latest and greatest, you have to check out this forum. And it was like I was time traveling because here was a PHPBB forum, just like I had built in 2004, except now in the late teens. And I was shocked. I was like, surely there's got to be better communities for this, like more modern. And he was like, no, this is it. And I thought, okay, that's an opportunity. I get introduced to Mr. Montgomery. He's got his deep background on the content side, Pawn Stars, and we're doing the Golden Show.

• 54:05Speaker 02

  So he knew sort of what I would call top-down, high-quality media and content creation. And he already had a passion for collectibles. And then I knew the bottom-up UGC. And we said, look, let's partner on this thing. We'll start with the UGC side because I know how to build products. We can get that going. And then from that community, we'll start to see things that bubble up that we'll be able to then take a top-down approach to make even better. And frankly, this is something I wanted to do at Reddit for a very long time. We just had other priorities where user-generated content can do an amazing job servicing a novel idea. But a crowd cannot easily create that next step of content. So the story everyone knows from the hobby is all those mantle cards. I think there were TOPS mantle cards that got dumped in the ocean.

• 54:50Speaker 02

  And she's an example. Let's assume some users like, hey, it's the anniversary of those cards being dumped in the ocean. And there's a thread and a bunch of the people in the thread upvote something about, I really want to know from that executive what they were thinking. And maybe this isn't that interesting with story, but imagine that. That is where top-down content can actually go and sit down with this guy and interview this guy. And actually make the piece of high-quality content that a bunch of random people on the internet cannot easily make. And so we asked that question, why a lot? And that for me is the lever where you can have scale with UGC. And then you can have the top-down really amplify and tell some of the best stories and then create this great flywheel.

• 55:32Speaker 02

  And we got really lucked out with amazing CEO Evan and off to the races. And so I'm excited. One, proof of humanity, these vertical communities that can show this is where actual humans are coming to talk about their actual passions, combined with this renaissance of alternative assets. Trading cards boomed during COVID. They obviously took a big tank along with crypto and all these other speculative things after, but already have started marching back and we're seeing record high auctions for a lot of the high end stuff. And I think as an asset class, it's here to stay. Mentally, I keep it in the same part of my brain as art would have historically been, except art is not nearly as culturally relevant as these are

• 56:14Speaker 02

  because the power of nostalgia and the power of sports in particular. Again, keep an eye towards, one of my favorite Jeff Bezos quotes is, "People don't ask often enough what's going to stay the same in 10 years. They're always asking what's going to change in 10 years." And so keep an eye towards 10 years from now. AI generated, everything is ubiquitous. What are the things in the pillars of entertainment that are going to matter more than ever in a world where every screen we look at will be perfectly programmed for exactly what we want to see, when we want to see it, the way we want to see it? There are genres of entertainment, you think about traditional television, cinema, they're going to have a hard time adapting to this because it's a lot of really good competition. But sports, sports will be the

• 56:57Speaker 02

  one last place for traditional entertainment where you are guaranteed to feel the humanity. No one will want to watch robots play basketball. Music sits in the middle. My daughter's still going to want to go to Taylor Swift because that's like a religious experience, but there's plenty of artists that are going to be displaced in different ways because it's just not that special. The one hit wonders, they're going to have a hard time. But sports, sports is going to thrive and you're still going to want to go to see the Knicks game even though you know you're going to get your heart broken because every screen in your life is giving you this perfect digital dopamine hit. And it's going to be a surreal, definitely a dystopian version of this. And I'm a tech optimist that's looking on the bright side of where

• 57:39Speaker 02

  this goes. I do think that we'll actually as a species, we will crave a break from that digital dopamine drip because we didn't make it this far to just be sedated with exactly what we want, when we want it. Sometimes when we were hunting the gazelle, we didn't get the gazelle and it sucked. And then when we finally got the gazelle, it was great. It tasted better than ever. And so there's a version of that that still needs to be fed in us. And that's where I think sports just continues to thrive.

• 58:07Ted Seides?

  When you're talking about sports, I just have to ask you, what have you learned from your wife?

• 58:15Speaker 02

  What have I learned? Well, it goes without saying, I wouldn't have tweeted that prophetic tweet in 2019 about women's sports, nor would I think I have started Angel City if I hadn't seen firsthand that women's tennis in America was the dominant sport. So, look, I didn't follow tennis. I knew who my wife was when we started talking, but I literally had never watched a tennis match. I grew up in a household where American football, NFL specifically, was the only sport that mattered. Tennis was a bullshit country club sport. Sorry, Dad. And that's what I played. That's what we watched. That was it.

• 58:58Speaker 02

  But I was obviously very aware of the Williams sisters culturally, but I just had never watched tennis. I watched my first match and I thought, oh, this is amazing. I got this sport way wrong. Just watching this thing courtside, like this sport is way harder than I thought it was and way more exciting. And I didn't even watch a men's match for a year. And when I saw my first men's match, I turned to my buddy and I was like, dude, why are they playing to five? That's dumb. I was a total neophyte coming into this. Here's an NFL sports fan. I'm already pissed because the sport won't let me cheer whenever I want to cheer. Statistically, if you're only playing to three max, each point matters more. The stakes are higher.

• 59:43Speaker 02

  So that was my first impression of tennis. I was like, this is great. Every point matters. As soon as I'm sitting in a match where it's the five, I'm looking at my watch and I'm like, but this first one doesn't even really count. This is a less compelling product than the women. But then I started to see the numbers of viewers here in the United States. And you look, year after year after year, more Americans watch the US Open Women's Final, which is the big American tennis match, than the men. And it doesn't matter, there doesn't need to be a Williams sister in it. There doesn't need to be an American in it. You could watch two non-Americans. This happened a couple of years ago, went head to head with Djokovic, who was chasing history. More Americans watch the women.

• 1:00:26Speaker 02

  And so that showed me, oh, my God. It took a lot. It took Billie Jean fighting for pay equity. It took generational talent in Serena and Venus. And with that, true, true, true American excellence. But all those things happened. And as a result, because, again, the cash money started showing up for the players as well. You now had an opportunity where for the United States of America, women's tennis was the top sport. Even just being competitive with the men in pro sports was unheard of. You couldn't find that anywhere else. But it was enough of a proof point that I said, okay. So if the women of US soccer are excellent.

• 1:01:11Speaker 02

  And even an average sports fan, again, I'd never watched women's soccer before, never watched men either. But if I closed my eyes and I was asked, think of American soccer greatness. I would think of Chastain hitting that penalty kick. I would think of Mia Hamm. I was aware of Alex Morgan and Rapinoe, but I was like, yeah, the women. Cause the American men have never been great at soccer. And I thought, okay, I can market greatness all day long. And then I started looking at the stars of the league and I see Alex Morgan with all of her followers. And I'm like, that's the free market of attention. And there's millions and millions, tens of millions of people paying attention to Alex Morgan. So she's gotta be worth more than, at the time, a team had just sold for $3 million. The math doesn't math.

• 1:01:52Speaker 02

  And yes, I had that confidence full stop because of Serena. And what she was able to do, set a bar and opened a door for women athletes. Obviously, I've got two daughters. I do care about the gender equity issue. But I actually care much more about the fact that the free market spoke loud and clear. And if you look at the list of top earning athletes every year, the only women are almost all tennis players. That's the global impact that Serena Venus had, that Billie Jean had to level the playing field, get equal investment. And the excellence followed and voila, people want to watch that. And so you're seeing it now. Katelyn Clark is having that moment. I think it's going to level up the W in a huge way.

• 1:02:36Ted Seides?

  And what have you seen about how that transcendent excellence in sports translates to day to day life?

• 1:02:45Speaker 02

  It's funny. I see Serena as my wife first, and that's not to say she's not excellent. I hope it's actually heartening to hear that it's not literally every single thing is excellence embodied. Whether it's Serena, or Tiger, or MJ, no, actually, they're kind of normal. I mean, they're not, they're exceptional humans. And what is it, they put on their pants one leg at a time like the rest of us. Like, there's actually something really remarkable about the normalcy. I think one of the best parts of Serena's evolution, and she would say this, she has said this, is that right now she gets to spend so much time as a mom.

• 1:03:31Speaker 02

  She was just volunteering at the book fair at Olympia's school. My childhood was obviously very different from hers. At a very early age, she had to take on tremendous responsibility and do incredible things. So this is the first time she's really been able to now have a normalcy. That, again, growing up, I think most of us, that's just what we consider life. But for her, is something that now she wants to be great at and is great at. And it's awesome seeing her do that. The one thing I can say for sure, though, regardless of whether it's on the court or off, she is the hardest critic on herself. And so that same instinct that drove her to want to be better, she always says there'd be no Serena without Venus.

• 1:04:14Speaker 02

  She always had to be a little better in order to keep up with her big sis. And she applies that whether or not she's making cinnamon rolls for the family, or just watching over our kids. She really goes to 11 always. She wants to be the best, and she's so incredibly hard on herself. And I guess that's the other side of it, too. No one should assume to be that great comes without tremendous work, tremendous sacrifice, tremendous cost. And that's probably the other thing that I think I see firsthand. And I think one of the reasons why, early on, it worked as well as it did for us,

• 1:04:55Speaker 02

  because I spent most of my life in relationships where folks didn't fully understand why I was the way I was and why I worked the way I worked. And I found myself in a relationship with someone who obviously didn't have any trouble understanding and obviously was doing things on just another level. And so it motivated me and it helped, I think tremendously to just be around someone who just was operating on that frequency.

• 1:05:23Ted Seides?

  Couple of quick closing questions. We'll get chat here. What is your favorite hobby or activity outside of work and family?

• 1:05:29Speaker 02

  Those are only two things I do. No, pancake art, but that's technically family. I do crepes on Saturday. I do pancake art on Sunday. All on my socials. I play Helldivers 2 with my buddies every now and then. My best friends are my guys since I was five years old. So they're still in the group chat and we'll fire up Discord and we'll play Helldivers once a week. Try to get in a couple hours. I started playing golf, but again, I do it just to play with my daughter. So I'm her caddy on Sundays and I'm trying to learn as well. And I just got into making brisket. So I started smoking, got a Traeger a few months ago and I do it every Friday night now. I gotta say I got it pretty good. Olympia randomly loved brisket. We were in Austin once. She tried it. She loved it. And I was like, great. My daughter loves a thing. Here's an excuse to get a smoker.

• 1:06:14Speaker 02

  Now I'm gonna go down the YouTube rabbit hole to master Austin or Texas style brisket. And now I'm doing briskets and I've got my own cow guy now. I'm in a total smoking meats phase.

• 1:06:26Ted Seides?

  What's one fact that most people don't know about you?

• 1:06:29Speaker 02

  I was getting my coffee this morning and the woman hands me the coffee and she's like, are you Alexis? And I was like, yeah. And she was like, wow. She was like, say hi to Serena for me, of course. And she's like, you're a lot taller than I thought you were. And I was like, really? I get this so often. So I guess the surprising thing that I keep hearing about is that people are surprised that I'm 6'5". But now you know, there's a surprising fact.

• 1:06:59Ted Seides?

  What's your biggest pet peeve on the investment side?

• 1:07:02Speaker 02

  Biggest pet peeve is, well, it's my alpha. It's the fact that very, very, very few people in this industry are building venture firms like technology companies. And yet we all talk all day long about how we invest in technology companies disrupting antiquated industries. Well, I've got an antiquated industry for you. It's called venture capital. And I know in the grand scheme of things, it's not the oldest, but it's still antiquated if the best technology people have is some rudimentary CRM and. What? Airtable? So that's my pet peeve.

• 1:07:36Ted Seides?

  Which two people have had the biggest impact on your professional life?

• 1:07:40Speaker 02

  I'll say Caitlin Holloway, who worked with now almost a decade since the Reddit turnaround now is 776. And this is gonna sound like a shameless plug, but I made a donation to Robinhood Foundation here in New York. And Paul Tudor Jones has really been just awesome. And he's certainly opened my eyes to what a really high functioning foundation could look and operate like. And I have my little baby 776 foundation, not on the Robinhood scale yet, but it has really opened my eyes to it. I know you asked about professionally, but I'm going to include the philanthropy part because I really want that to be a big part of my legacy. And I do for-profit venture capital work.

• 1:08:24Speaker 02

  We're trying to maximize returns and I want to do so in a way that my kids will be proud of me for. And I think we're tracking well there. And I also think that a lot of these same attributes of entrepreneurship can be applied to philanthropy. And certainly in the way we've given out. So I've got 20 million in climate grants that I've been putting out every year. We take over locations all over the world. Select 20 young people, give them $100,000 each and just say, go build, go do something. If I can use these muscles that I've exercised around early-stage investing and building companies to help a whole other generation entrepreneurs do great things to help make the world suck a little less, that's a win.

• 1:09:04Ted Seides?

  What's the best advice you've ever received?

• 1:09:06Speaker 02

  My mom told me that I should never live my life for what I think she or my dad want. And what she said was specifically, she was like, look, you're gonna make me proud as long as you are living your life. And as long as you are doing what you feel is right for you, I'm gonna be proud of you. I don't care about what the details are. I just know that's what's gonna make me most proud and I can see you doing it and keep doing it. And it's wild because I've come to meet so many people whose parents, for whatever reasons, were much more prescriptive. Like, oh, you gotta get a job here, you gotta do this, gotta do that.

• 1:09:47Speaker 02

  And I feel like one of the most liberating things that she did, which maybe that was part of her master plan, even while I was going down the road of something very prescriptive, like, go be a lawyer. She just kept reminding me, do you find whatever it is that you wanna be great at and then go do it the best you can. I didn't realize at the time how special that was and I feel like I've had that echoing in my ear ever since. And now as a father, I mean, I have a six-year-old, but Olympia comes to me and her mom with a new thing she wants to do when she grows up, probably every week. Right now, it's a fashion designer. Last week, it was a model. One week, it was a diva. Then it was a veterinarian before that. Actually, no, tennis player. As of yesterday, now she wants to be a tennis player.

• 1:10:30Speaker 02

  But I try to carry my mom's message forward, even though she's not here, which is just, look, the only promise you have to make to us is that whatever you do, you've gotta just do your best at it. Do something you truly wanna do. Hopefully be useful in the world with something. And we'll support you and we'll love you for it.

• 1:10:48Ted Seides?

  All right, Lex, this last one. What life lesson have you learned that you wish you knew a lot earlier in life?

• 1:10:53Speaker 02

  I'll give you the one that I learned in my twenties. Actually, I don't wish I learned it earlier, but I'll still take it. The greatest gift that I got seeing my mom struggle and fight brain cancer was, here I was in my early twenties, feeling invincible, starting a company, oh, look, I'm a CEO. And I saw firsthand what someone cares about when they've got a few years to live. So even as I came into early wealth, as I came in all this stuff, I never got it twisted because I can tell you, spoiler, the only thing you're gonna care about, if God willing, you get a long and healthy life to look back on, is the people that you spent it with and that you love and the experiences you had with them. And those memories and hopefully those people are still there with you. And that's it.

• 1:11:37Speaker 02

  And what was the best part of a really hard time was seeing her live that out every single day. I made that money. I knew what I was gonna get my dad. My dad, we had a couple of nosebleed season tickets for the Washington Commanders now, and I upgraded him. I got us four tickets and we're front row. So my two friends would come. I didn't miss a game for 10 years. And so that was, I knew what my dad wanted. And I asked my mom, I was like, what do you want? She was like, I don't want anything. I was like, come on, you gotta want something. She's like, I don't want anything. Every week I'd call, be like, come on, mom, let me get you something. Every week, nothing, nothing, nothing. And finally, she's like, okay, look, if you're gonna keep calling me, just make a donation. This is nonprofit that I love that works with dogs and shelter pets. And I was just like, really? I wasn't a billionaire, but I made a lot of money here at 22 years old. I'm like, mom, I'll get you something.

• 1:12:22Speaker 02

  Didn't want a thing. And for all those years that she had left fighting, the only things that mattered to her were the time that we could spend together. Thankfully, she got to spend a ton of time with my dad, a ton of time with me. And yeah, so that's the cheat code. And so sitting here at 40, I still feel as ambitious as ever in my professional career. And I know that so much of what I'm doing now is hopefully part of some bigger picture that I get to paint for my two kids and the friends I have. And I still have to remind myself to put the phone away. Trust me, I'm not perfect at this, but I've really tried to create some hard and fast rules, especially while my kids are still young, to make sure that they know I'm there, I'm engaged, creating those core memories.

• 1:13:05Speaker 02

  And I just know, none of this is for anything else other than the legacy. I'm leaving them with hopefully time well spent and a dad who's got a job that he cares about and a job with purpose. I want them to see me working. I don't want them to see me not. And I frankly, I don't think I'd last too long just sitting around. Like I said, it's all thanks to her. And as I've gotten to know other folks who have gone through similar things, it's been eye opening too, to see this is a recurring pattern. And so every bit that I can do to try to make that time count with my close friends, my loved ones is hopefully honoring them.

• 1:13:38Ted Seides?

  Alexis, thanks so much for sharing your story and this exciting path through almost 776.

• 1:13:44Speaker 02

  I'm listening to a few of your pods. They're not normally this heavy and philosophical, man, but I'm glad I could do it.

• 1:13:50Ted Seides?

  Thanks, bud. Thanks for listening to the show. To learn more, hop on our website at capitalallocators.com, where you can join our mailing list, access past shows, learn about our gatherings and sign up for premium content, including podcast transcripts, my investment portfolio and a lot more. Have a good one and see you next time.