Howard Lindzon, GP at Social Leverage: The Science of Seed Investing

Howard Lindzon is one of the best FinTech investors in the world. His portfolio speaks for itself. In this conversation, Lindzon and Anthony Pompliano discuss what Lindzon looks for in great founding teams, and the trends he's excited about moving forward. ----- Join the Off the Chain newsletter. Pomp's daily email analyzes the crypto market for institutional investors. Simply, it’s the best crypto newsletter delivered to your inbox every morning. No frills. No bullsh*t. Just everything you need to know in a 3-minute read. https://offthechain.substack.com/ ----- BlockFi BlockFi allows you to keep your crypto, put it up as collateral, and receive a USD loan funded directly to your bank account. They do loans ranging from $2,000 to $10,000,000, and they're perfect for helping you reach your financial goals of all sizes. Visit BlockFi.com/Pomp to learn more about putting your crypto to work without having to sell it. ----- If you enjoyed this conversation, share it with your colleagues & friends, rate, review, and subscribe. This podcast is presented by BlockWorks Group. For exclusive content and events that provide insights into the crypto and blockchain space, visit them at: https://www.blockworksgroup.io

• 0:02Speaker 00

  What's up everyone, this is Anthony Pompliano. Most of you know me as Pomp. You're listening to Off the Chain, simply the best podcast in crypto. Let's kick this thing off.

• 0:15Speaker 00

  Howard Lindzen is one of the best fintech investors in the world. His portfolio speaks for itself. In this conversation, we talk about some of the things he looks for in great founding teams and the trends that he's excited about moving forward. I really enjoyed this conversation and Howard is as funny as ever. I hope you enjoy it too.

• 0:37Speaker 00

  Before we get started, I want to talk about one of our sponsors, BlockFi. These guys are doing really interesting work in crypto lending. What they allow you to do is keep your crypto, put it up as collateral, and receive a US dollar loan funded directly to your bank account. They do loans ranging from $2,000 to $10 million and they're perfect for helping you reach your financial goals of all sizes. You should visit blockfi.com/pomp. Again, that's blockfi.com/pomp. Again, one more time, type it in, blockfi.com/pomp. If you'd like to learn more about putting your crypto to work without having to sell it, definitely do it. We all know legendary venture capitalist Tim Draper. He's one of the earliest supporters of Bitcoin and has done a ton of work to drive crypto adoption. Many people don't know about one of his newest endeavors, though, Draper University. If you're an entrepreneur looking

• 1:22Speaker 00

  to launch your idea in crypto, you can apply to attend their pre-accelerator program and learn how to build successful global companies from Tim. And for all you corporate executives out there, you don't need to feel left out either. Draper University also has a week-long intensive program that will get you educated on all things blockchain and crypto. As we know, knowledge is power, so don't get left behind. You can check out draperuniversity.com. Again, that's draperuniversity.com and let me know what you think. If it's good enough for Tim, it will probably be good enough for you. And as Nike says, just do it. This podcast is presented by Blockworks Group, the only blockchain event and media production company I trust. If you're an investor, lawyer, accountant, or entrepreneur, and want to attend exclusive events and dinners, visit them at blockworksgroup.io. I promise

• 2:07Speaker 00

  you won't be disappointed.

• 2:11Speaker 01

  Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions of Morgan Creek Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only.

• 2:38Speaker 00

  All right, guys. We have the very first not in-person recording. I've got Howard on video, so bear with us if there's any noise issues. But thank you very much for coming on.

• 2:53Speaker 02

  Thanks.

• 2:54Speaker 00

  He's waving and drinking water. So let's start with your background. And I actually think most people have no clue about how you got into investing in early-stage companies. So maybe just give us a rundown?

• 3:11Speaker 02

  Yeah, I'm born in Toronto. I was part of the caravan before caravans were cool. I came down to go to Arizona State. We attacked from, we attacked the border from Windsor very, very weak.

• 3:30Speaker 00

  You came the other way. The autumn caravan is coming south to north. You came north to south.

• 3:38Speaker 02

  Yeah, I came with an Israeli flag over the bridge from Detroit, and Detroit was burning back in those days. So the, but I did, I am born in Toronto. I was fascinated with the desert. You know, Jewish people in Florida, Jewish people in Toronto go to Florida in the winter. My family went to Phoenix. So, and you know, 11 years old, I go into Arizona State football games. I'm like, I'm coming to Arizona State.

• 4:10Speaker 00

  Why? What was so enticing about Arizona State?

• 4:14Speaker 02

  Girl short, everybody was perfectly tanned and beautiful. And I was tall with a big nose and white. And I thought my odds would be much better there to meet my future wife. And cycling, golf, just everything. Like you come from Toronto and you were like, I just couldn't believe Arizona State in Tempe. So anyways, I went to school in Arizona. And you know, wife, 23 years, two dogs, two kids. Both my kids are, I like to say, own and operate two millennials. They are at University of Arizona.

• 4:58Speaker 02

  I kind of invest by looking over their shoulder the last 15 years, but I've been investing in startups for over 20 years. Most of the last 11 quite successfully. You know, it took me probably five to 10 years to actually even understand this stuff. And I think the most exciting part about podcasts and where we're at today and social media and crypto and everything is how connected people are. You know, this whole idea of, you know, six degrees of separation and now we're almost at one degree of separation if you behave and know how to use the tools. And so the leverage that people have been able to create over the last 10 years has been exponential.

• 5:43Speaker 02

  So we'll get around to this, but you know, we started a company called Social Leverage in 2008 during the financial crisis when my thesis was, you know, people are going to learn their lesson. Financial leverage is a great tactic, it's not a strategy. And now, so we started the idea of Social Leverage, which is our fund name and our company names, which more about the with different problems, but idea of, you know, one person able to leverage and sell into a network and wider and deeper and with that leverage and how powerful it is from individuals, you know, breaking down barriers and countries into neighborhoods is a powerful thesis.

• 6:28Speaker 02

  And here we are in 2018, we've seen some of the dangers of social leverage, but social leverage is still just beginning.

• 6:38Speaker 00

  How do you invest not in LA, San Francisco, New York?

• 6:44Speaker 02

  I live on a plane.

• 6:45Speaker 00

  I think that surprises a lot of people.

• 6:48Speaker 02

  Yeah, I live on a plane. I think it's an advantage. If you understand the power of face to face, I mean, this is our first face to face. Like, we haven't, we know each other. We haven't done a call.

• 7:01Speaker 02

  Generation doesn't use FaceTime or Skype. Creeps me out.

• 7:08Speaker 02

  I feel like it's important to just be face to face, right? Like, we know each other from our tweets and from the friends of friends and from doing deals together and hearing feedback about how you work with other entrepreneurs, et cetera, et cetera, et cetera. But the power of face to face is key. I grew up in an era of face to face. You had to go, I was a stockbroker, you had to go knock on doors and meet people face to face. Saw the value of that. I was never a cold caller, although I was good at it. So I think what makes it work is Phoenix, where, you know, my formative business years was a great airport. We lived within 20 minutes of the airport. You could get anywhere. I had two babies, so it was fun to leave.

• 7:51Speaker 02

  I mean, you want to leave when you have two kids, if your wife, you know, you're making up stuff. Honey, I got a deal to do in Botswana. You leave the kid crying in his crib. But, so I think how you do it is, is face to face. And, you know, the world has shrunk, right? Phoenix is a great airport, Southwest, you got to LA, got to San Francisco. Get to New York, you get to Toronto. And, you know, many of the lessons I learned about, you know, shitting in your own backyard. I don't like to invest where I live.

• 8:25Speaker 02

  In 2008, in Phoenix, you realize how small the world is, you know. Every, you go to a coffee shop and everybody that you lost money with in a real estate deal was still in that coffee shop. So, you know, it's, it's, to me, it's better not to live in and work in the same place. So with angel investing and now seed investing, I'm happy to go to LA for a day or two, see all the founders, not have to live with them, not have to run into them if we've lost money together or not getting along type thing. So I think it's, I think it's actually a positive to not live in the place that you're investing.

• 9:02Speaker 00

  It's a very fascinating way of looking at it.

• 9:05Speaker 02

  I couldn't be forfeiting. I mean, anybody could argue that I'm forfeiting the answer, but I think our results speak for itself. You know, social leverage is at, you know, top tier results for, for 10 years.

• 9:14Speaker 00

  Well, I was just gonna say, so I, I actually don't remember the exact tweet, but I remember you tweeted, um, I think it is your, uh, maybe like late 2000s vintage fund that, uh...

• 9:26Speaker 02

  2015 is pre-Quinn's number one fund. It was a $21 million fund. Um, it has Robin Hood and WAG and Customer in it. We think there'll be, and Narvar, we, we think there could be up to four billion dollar companies in that fund. Well, there's two that already basically are.

• 9:44Speaker 00

  Got it. And, and you invested the capital in when, 2015?

• 9:49Speaker 02

  First checks, yeah, seed fund. Uh, so, you know, WAG was probably at a four or five million, Robin Hood's under 10. Um, and Narvar was four or five million and, uh, um, Customer was seed rounded around a eight or nine million with Ed Sims, who's a New York VC, great guy.

• 10:10Speaker 00

  Got it. And then why the focus on fintech, right? Cause I know that you've done a ton in the space, obviously Robin Hood, et cetera. Like what, what's the driving force behind your, your conviction there?

• 10:21Speaker 02

  Yeah. So this is the, the key thing, I think, for people to know. I mean, it's not out of the blue. I have been fascinated with making the idea of markets, just the, just the, just the game, you know, not a gamer. Uh, I'll never strap on headphones and play games, you know, it's not in the genetics of our family. Like my son played Fortnite for like maybe three, four months with buddies, but more for the social part of it.

• 10:48Speaker 02

  So for whatever reason, I miss the gaming gene, the, you know, I'm a face to facer, not a gamer and, um... The markets are a game. You know, I hate to, you know, I'm not trivializing by saying it's a game. It is the ultimate battle of wits, as, as one could say, against everybody else. Meaning, I, I, I look at the markets as complete battle of wits and behavior, not a battle of numbers. And, um, and I think anybody can learn that then, you know, we're all, we all can survive in the streets. I think, you know, if we saw, if we, if, if we understand the poker phenomenon that took over the world a while back, you know, with, uh, was the idea that any, you know, if you're playing a certain type of poker game,

• 11:32Speaker 02

  you could have a peasant from the street of the Philippines play a CEO of a Fortune 500 company on a computer and battle wits, uh, with bluffing, et cetera, and just getting good cards. And I think that's the stock market, right? The difference being you gotta have a table stakes i- in the stock market. And so that was one, that's one problem, obviously, that persists is, and that's where crypto came in. And that's where Robin Hood comes in, is democratizing the playing field, onboarding. What fascinates me most about the markets is it's for rich people. And we could joke about that and we could complain about that, or we can try and solve some of the problems. And I felt, as someone who participated in markets since I was my teens,

• 12:15Speaker 02

  that I've been fascinated with onboarding and onramping and next generation of investors. And that led me down this path. Um, I'm more proud of the fact that, uh, you know, that we, we had a point of view of social leverage about how fintech was going to evolve, more about the do it yourself versus the robo. Um, because I think it's a battle of behavior. I think saving and investing are important concepts and there's, there's very simple ways to do that. You just spend less than you make and then you dollar cost average into a robo advisor. I have no arguments against any of that stuff. I just don't think they're VC type investments in that space unless there's a game,

• 12:59Speaker 02

  if there's some learning at the end. And I think the, the game mechanics of the stock market and what Robin Hood brought, the easy onboarding and access. E-Trade did that before this and, and Schwab and Daytech in two thousand, in nineteen ninety-nine, and they were rewarded greatly. And then we had like a fifteen year chasm between innovation. And we can talk about that, how social networks finally disrupted the walled gardens of brokerage. And we're seeing the early stages where people say it's a bubble. I'm saying we're in the early stages of a fintech boom, right? The next fangs will be fintech companies, not social media companies. And they won't be JP Morgan and Goldman Sachs. They'll be the Stripes of the world and they'll be companies out of India and China, the

• 13:44Speaker 02

  underbanked that are onboard this next generation. So I feel we're just getting started in this, you know, there'll be bear markets like we're in right now, but we're just getting started.

• 13:55Speaker 00

  So this is a really fascinating perspective around the next things are fintech companies, right?

• 14:06Speaker 02

  Yeah.

• 14:07Speaker 00

  And I've said before that it feels like for the first time in full way over the last five years, technologists have turned and are attacking Wall Street and really starting to understand how it works, what's broken, and using a lot of what they've learned in building technology to do that. What are some of the areas where you think the biggest companies are going to get built or the areas of opportunity that maybe you haven't invested in yet, but you're looking for?

• 14:43Speaker 02

  It's a good question. I don't think we're good enough at social networks. You know, there's like the Sequoias, the Fred Wilsons, the Chris Dixons that really, you know, maybe I'm a polymath in the sense that I have so many interests, but unfortunately for me, brain capacity or just general lack of playfulness and understanding of tech, I'm at a disadvantage, so I got to know my own weaknesses. But I think the biggest opportunities outside of hardcore tech for me, because I don't really run an engineer, are how do you arbitrage customer acquisition, right?

• 15:23Speaker 02

  You know, what Robinhood did, they did two things. And again, I don't have any inside information. I'm just surmising from valuation growth and from demand of, you know, people excited about the company. And there's obviously detractors too, but you know, overall, the excitement around Robinhood and its growth. And that is two things. They did two things. Firstly, arbitrage customer acquisition. We came from a world where E-Trade and Schwab and we're paying three to four TD Ameritrade paying $400 a customer. And like I said, I own and operate millennials. If you spend $4 on my son, you've overspent getting that customer. You know, they're not loyal. Uh, they're fleety.

• 16:06Speaker 02

  Um, they are, they are going to use hundreds of accounts to do everything. Right? You know, you know, you wrong them once, there's very low switching costs. You don't have relationships with these companies and they're a dime a dozen. Right? And there's three or four companies in each vertical. So that had to be disruptive. And I think what Robinhood got right, what got us excited at the beginning was, you know, knowing the industry and knowing that the only way to really win in fintech was to arb the customer acquisition cost. So if you could get the cost of customer acquisitions down to zero, which basically Robinhood did and Snapchat did before it and Facebook did before it. And you could have a friend to screenshot and show them, I just bought one share of Apple. You, you were going to win. If you could raise enough venture capital.

• 16:51Speaker 02

  But the second part is, do you, can you reinvent a business model? Which Robinhood also did. You know, in the early days of talking with Bijou on the phone and how they were thinking about, um, you know, flipping the, the margin model, meaning, you know, turning, you know, getting people to pay for the, for the feature of margin without actually having to use margin, giving people enough of a user experience and, and satisfaction from the core product that they would pay a Amazon Prime like service fee was the second phenomenon that Robinhood created, uh, which will see major innovation. And this is why I'm bullish on, on fintech. Robinhood.

• 17:31Speaker 02

  Solve one problem that got them to a billion, which was how do I get a million customers for $0? Because if it costs TD Ameritrade $350 million in marketing to acquire their first 100,000 customers, well then Robin Hood's worth $1 billion because they solved that problem.

• 17:49Speaker 00

  Yep.

• 17:50Speaker 02

  The second problem is how do you build a business? And I think this is what gets me excited about fintech and Amazon Prime and Netflix, same thing is if you can create a great user experience and if you can run a lean operation using software as a service products, which Robin Hood will eventually and fintech needs to solve this too because of the SEC and FINRA. But if you can onboard them, then create a business model because of the scale of software, you've just, I mean, the walls, like whether JP Morgan or Goldman Sachs believes it or not, they are basically in a continuation of doom. Meaning, Robin Hood, let's say they have 5, let's just agree, they say 6 million, let's say they have 5 million customers. They can hire a corporate guy from Goldman Sachs to do IPOs.

• 18:33Speaker 02

  They can go to Airbnb and say, listen, give us $200 million of the IPO, which is a fat profit center for the banks right now, right? And we'll distribute it 200 shares to every one of our customers that wants some. And none of these people want to sell, so there won't be the flipping problem. There won't be, you know, instead of BlackRock, Vanguard and State Street getting 90% of the allocation for an IPO, Robin Hood just solved it, they're not even focused on this, I'm sure. But they just figured out a way to disrupt the whole IPO market. Because Dutch auctions should have disrupted the IPO market like Google did or Spotify did. Why haven't every company done that? Well, Robin Hood and maybe Acorns or new brokerages that are starting can get into the IPO game

• 19:18Speaker 02

  and get true distribution for IPOs.

• 19:22Speaker 02

  And this is part of the problem for crypto right now is crypto is too far ahead of what really in the United States is important. You know, I believe where the problem in the United States around crypto, and this again, strong opinion loosely held, is that crypto is too far ahead. You should get your, there should be more Robin Hoods, right? There should be people innovating on the actual brokerage model. Like trust, you know, Americans trust brokers. Americans trust the idea that $250,000 of my money will be insured by the FDIC, right? And so I think the crypto stuff just got too far ahead of where it is. You know, everything's on the blockchain. Well, why not just work with the SEC and FINRA and do

• 20:03Speaker 02

  it legally and build a moat, like a nine-month moat around, you know, doing this stuff properly? So I think these are the exciting things. I think we're going to come back more to an era of, you know, using broker dealers, FINRA, more table stakes stuff where entrepreneurs need to go spend the six to nine months in the, you know, working with lawyers and getting the trust built at the ground level. So, so I think, long story short, there's just old business models, I mean, old banking businesses with new business models and better UI are going to be the solution.

• 20:41Speaker 00

  It's funny because what you're talking about is using all of the advantages, the iteration speed, the engineering talent, et cetera, that the tech companies just understood better than anyone and really leveraged into, you know, hundreds of billions of dollars of value creation, et cetera, and applying it to an industry where there's artificial governors on what you can do, right? The regulations, the licensing, all of this stuff. And one thing that, you know, the Robin Hoods, et cetera, of the world were able to do that I don't see a lot of crypto companies doing, is they actually understood the inside baseball

• 21:26Speaker 00

  of Wall Street, brokerages, et cetera, right? They need to do certain aspects of how to make money while offering a free product to the customer and things like that. Do you think that in crypto, more and more teams are going to have to look early for employees that know that inside baseball? Or do you think a true outsider or a team of outsiders can come in and completely disrupt the financial markets?

• 21:52Speaker 02

  Yeah, it's a great question. Having been to China, I say two things. First, gray means go in China, and in gray in the United States means slow the fuck down, talk to the SEC. I think Naval did a great job as an angel investor back in 2010 in Angel List. And Naval did the hard work, right? He was paying both sides of the government, he was using software to lobby, he was flying to Washington every week. I don't think anybody will ever appreciate or understand the stuff that Naval and Angel List was, the hardcore work he was doing, just trying to be a legal, trying to get this stuff all legal for people. And then, sure enough, everybody goes around the system. It just, you know, the system is the system, right? I have two kids.

• 22:35Speaker 02

  My daughter lives right on the rails, right? She's like, and I always tell her, like, she's a great student, she's a great kid, she believes in the system. And, you know, when she has her first job, she's gonna go, "Fucking system blows," right? Like, she's so on the rails that I keep reminding her that, like, it's great to be on the system, but the system's gonna let you down. And you've gotta learn to live sometimes and step off the rail. My son, on the other hand, does not know the rails exist, right? He's pushing buttons and money comes out of thin air on Venmo, and Uber Eats delivers whatever the fuck he wants to his room, and Netflix and YouTube. He doesn't know that there's actually a system. He's a kid who doesn't vote, because he doesn't even know what socialism is in him,

• 23:19Speaker 02

  but he's a giant socialist because he thinks everybody has an iPhone, and the world is kumbaya. And so, I'm trying to teach him to get on the rails. Like, oh, there is a system, you have to play the game a little bit, at least in the United States, because otherwise, you're just gonna be, you know, left, you know, you've gotta be on the grid a little bit. So, there's that whole thing of, like, what's the fine line around fintech? Fintech just is, there are rails, right? There's Visa and Mastercard, which everybody's still paying, whether you're Square, or whether you're Stripe, or whether you're PayPal. And so, those are the Warren Buffett railroads,

• 24:01Speaker 02

  that those stocks continue to go up, because no matter how much innovation happens, even Google couldn't disrupt those guys, and you're paying them. So you've got to like really understand what the US financial landscape is, you know. For for for me with crypto is like, fuck, man, Visa, Mastercard, and and for my kids. Um, Venmo, even USAA, I mean, there's just enough great product on the current financial system where you hold your nose. And and you just play the game. What upsets me about the system is is how the investment world works like so give you a typical example of a great idea that's going to happen and and and eventually and

• 24:42Speaker 02

  change the financial markets is Vanguard sitting on a product where you it's this is why the robo advisors aren't to me great venture businesses. You know, Vanguard is like Google of of of money. Just with, you know, they don't really care about tech that much, but they had a really great idea, which was, you know, an ETF, you know, package it as passive investing. It's really an active product and get the fees down to zero. Right, like and and and and acquire dollars at exponential rates. When and and they've somehow created this myth about you don't have to pay anything and you'll have active management, which it really is, that's the genius of Vanguard, and leave your money alone.

• 25:28Speaker 02

  Okay, which is great, except that it's created an environment where companies can cheat and be rewarded. Wells Fargo is in the S and P 500, so it doesn't matter how many people they kill, how many mortgages, how many people they screw over about their mortgages, how many tweets complaining about them are, how many fees they charge, because when Betty Lou in Iowa wakes up the next morning and allocates money to her 401k, a percentage goes into Wells Fargo. And so until we fix that, until we can punish the companies by voting with our our dollars, if all our money flowing into Vanguard and Wells Fargo and Equifax and all these Facebook and all these companies cheating, get get their allocations for for being in the Fortune 500 or S and P 500, then the game is broken.

• 26:10Speaker 02

  And that's why Robinhood and all this education around do it yourself matter. Vanguard should be coming out with S and P 490 funds where you can. Kick out Goldman Sachs, Wells Fargo, and on the fly tell you that this fund that excludes these 10 rapist companies who are misbehaving endlessly, and we can give you the exact same returns that the S and P 500 does, or you know, it differs by fractional amounts over 10 years, then you would have people voting, then you would have true reform at the corporate level. The way indexing works, and the way pensions work, and the way Vanguard, the S and P 500, kind of everybody owns the same stocks, there's really no incentive for these companies to behave.

• 26:57Speaker 02

  And that's an opportunity for fintech. I don't want to build my, everybody's trying to build their own ETF, build their own robo. It should be more of de-selection, meaning here's the 500 you can have, unclick five of these miscreants, and have an S and P 495 fund, and now those companies will really be punished because they won't be getting money.

• 27:17Speaker 00

  All right, before we continue with this conversation, I want to mention our sponsor again, BlockFi. Remember, they do crypto lending. So you posted your crypto as collateral, they give you a US dollar loan, and you can use the US dollars to do whatever you want. You should visit blockfi.com/pomp, and then tweet at me that you went. If you tweet at me after you went to blockfi.com/pomp, maybe I'll throw you a like, a smiley face, or the fire emoji. The fire emoji is the best. Remember, go to blockfi.com/pomp, and I'll see you on Twitter.

• 27:47Speaker 00

  What do you think, if you had to switch seats, right? So you're in the seat of the disruptors, the startups, the entrepreneurs now, and that's who you're looking to back and the best one to make money. If you had to switch seats and sit in the seat of the large banks, the legacy financial institutions, and kind of the institutions, what would you do to prevent this or to get ahead of it?

• 28:11Speaker 02

  Well, I think Goldman, much as I hate them, have done a pretty good job, right? The question is, is the boat that they're building big enough to take over the boat that they've got, the legacy, right? Because at one point, eventually Robin Hood, if and when they get public, is going to have to make more and more money, and they're going to use their distribution and the fact that they have a lean operation to get into every aspect of Goldman's business, right? As soon as they build enough trust, they'll be able to offer more products. So I start with IPOs because that's a fat part of the system. If they can go do Airbnb and Uber's IPO with their 6 million users and do it in a better way at a lower cost, boom, they're going to win. And by Robin Hood going and building out their own clearing firm, they can now do that.

• 28:54Speaker 02

  So it's going to take much, you know, I've always been shocked that there hasn't been a lift to Robin Hood's Uber in the United States, right? We've got all these robo-advisors, but no one's wanting to go do the hard work of acquiring customers and offering a great product. You know what I mean? Everybody's just packaging, investing like it's just set and forget, and a robot could do this. It's bullshit. So if I was sitting in their seats, I would be, you know, spinning off, you know, Goldman Sachs, you know, new bank into an entity so people could truly own the part of Goldman Sachs that's interesting, right? So I don't, I don't think they'll do that.

• 29:37Speaker 02

  I think, you know, they're so used to like the power coming, the way the entities work, you know, the money flowing to the top. And I think the fact that all these brokers and the laws under Clinton and before that around, you know, the, like Citibank, you can't fucking run that entity with that many employees around the world. You don't know what anybody's doing. So I think spinoffs need to happen. Spinoffs are good, giving people access and knowing exactly what they own and the entity matters. I don't think conglomerates, you know, they're, they, they sound great for Warren Buffett, but I think people should know what they own. So I think these banks have to spin off, you know, units and focus on growth and on, you know, the bottom line per unit versus this conglomeration of assets.

• 30:22Speaker 02

  And we're seeing that Goldman Sachs stock is the same price it's been for 10 years. But within Goldman Sachs, there's great talent and there's the Marcus and all their new banking stuff is really interesting, but they've got to spin that shit out.

• 30:35Speaker 00

  Absolutely. What um, let's talk crypto for a second in comparison to the traditional or to what we'll call the new age financial markets, right? So these disruptive things like Robinhood, etc. So we saw Robinhood go into crypto by basically taking their core public equities business and matching it up with crypto. And now they've got kind of this hybrid offering. I think you see Square, you know, adding more kind of functionality or services around crypto. Do you think that the wave of fintech disruptors that have come online over the last five years are just going to incorporate crypto and keep marching forward? Or do you think that the crypto, you know, companies that are being built today or in

• 31:19Speaker 00

  the next two, three years actually will compete against those fintech disruptors of the last five years? Right? Is there like a melding of just fintech in general and then these new companies have a shot to take down the banks? Or does there end up becoming this like infighting between the disruptors and they've got to beat each other before they can take on the banks?

• 31:38Speaker 02

  Yeah, really good question. I'll give you my, my take, my weird take is that I don't even know what a bank means because I don't go into it. My son, this summer, I'll talk about my son again because again, I own and operate two millennials and I've lived by watching them, right? It's fascinating. He's never, so my son who, who's Venmo and, and, you know, can live on almost nothing because of, you know, the tools that they have. He had, you know, a job this summer. He was making real money and he demanded to be paid in cash. He had never held cash. He wanted to go to his friend's casinos, you know, Uber over at night in San Diego. So he was like carrying around a wad of cash. Like a bank

• 32:21Speaker 02

  meant nothing. All a bank meant to him was like, fucking guys need signatures and my driver's license. I don't even, you know, he didn't want any kind of information from his bank. He trusts his parents. You know, we've been saving money for him. He has his money, but he wanted cash in his hand. So I don't even think a bank, I think a bank's the wrong term. I think we've got the cloud and we've got the smartphone and we've got a and we've got we've got this constellation of brands that we're gonna trust because you know in China it's Alibaba and it's we pay and Alibaba so it's a different world over there because like I said great go but in the United States I believe the kids will have nine to twenty financial apps depending on how much money they have and who gave them the money from

• 33:03Speaker 02

  which generation that money was given down to that kid depending on when we die and hand our money off to the kids but um so they're gonna have a constellation of financial apps because it's easy right and um you know you know we can we can I don't have much time we can go through all this but they're gonna have some money at Robinhood like right now even though I'm I'm a venture capitalist I've got Schwab I've talked to a broker at Morgan Stanley I got Robinhood I got Koyfen I got a Rally Road I got Coinbase I got eToro I've got like I said a Schwab account still I'm not loyal to anything I just have my different

• 33:43Speaker 02

  things I trade a little bit at Robinhood but I do most of my big investing by calling a broker at Morgan Stanley I have my IRAs at Schwab I mean it's weird but it works and because money is important to me I don't wanna have it all in one place you know and I guess if I was gonna have it all in one place I'd still have it at more if I had to choose gun to my head I'd still have it at Morgan because I'm of the size that I'm comfortable talking to a person I don't want them giving me any advice I don't want them I don't mind if they charge me but I want them to pick up the phone on the first ring and provide the service that I give them directions to do that's a snowflake I am

• 34:26Speaker 02

  in a like in the I have a weird way of looking at at my money and financial this next generation is up for grabs they're gonna have money in their machines they're gonna have money in the cloud they're gonna have apps they're gonna have money that they just keep in the Venmo world to pay out bets I mean and they can juggle it all

• 34:45Speaker 02

  Because they don't have that much of it. And the second thing is they don't need as much. You know, I was in hawk to best buy until my mid thirties, right? There isn't these kids. They don't need to buy anything. They've got an iPhone, which is their TV. They have Uber, which is their car. They have food paid for if they had, if they're good at sales and engineering their foods mostly paid for at work. Um, so they're going to spend their money on experiences and they can just grab little assets from different wallets all over the place. So I think, I think the idea of a bank makes no sense to me, right? Um, I think.

• 35:21Speaker 00

  What, what, what about investing, right? So, so I agree with you on, um, you know, and it's all, I'm thirty years old. And a lot of the things that you're saying right now resonate in terms of what I own, how I live my life, et cetera, right? And I think there is a cultural, I don't know, kind of trend or, or, or a tailwind, if you will, that really, um, the keeping up with the Joneses is very different than the keeping up with the Joneses of probably my parents or their parents age, right?

• 35:57Speaker 02

  Yeah.

• 35:57Speaker 00

  Um, with that, how do you think investing changes? Right? Cause I don't think that the, the desire to invest or make more money will go away, but it definitely looks very different.

• 36:11Speaker 02

  Yeah, I think where what I liked about the Robin Hood strategy, and again, I armchair quarterback only, I, you know, I would have gotten into crypto much earlier if I was them, but it turned out perfectly, you know, for them. They didn't invest too much. They jammed it through and they haven't had, they're not as reliant on that as a revenue source. But I feel where, and I'm an investor in eToro as well. So I'm lucky because, you know, I'm an investor way back in eToro, which is not an overnight success, but an incredible company out of Israel and now London and a hundred and forty countries. It's kind of like a mix between Robin Hood and Coinbase and a bank. Um, which you can do if you're not in the United States.

• 36:49Speaker 02

  But I think the idea of, of, of selling some Bitcoin and buying, you know, using my Bitcoin profits or losses and swapping that into Apple in one app is important. That's where I think Coinbase, I just never understood their decision. And then they've gone institutional and God bless them and good luck. But I think the idea of having all your money in decentralized or blah, blah, blah, whatever we're going to call these assets is weird. Okay, so it's weird in this environment, meaning every time I open my Coinbase account, it's down from the day before, right? And I can't do anything about it except go to cash or wait it out. Okay, so I think they've lost me. Like, I can't wait to, you know,

• 37:32Speaker 02

  I don't have much money there, but they, they, very little, in case you're trying to hack me. Okay, I've just deleted everything, by the way. No, but I mean, like, they have, they've lost me. You know, my daughter, who had $3,000 there, what do I tell her to do? Like, she can't do anything with it, except wait it out. And that's not, that's not, that's just pisses me off towards the ground. Whereas Robinhood, I can go from Apple to Bitcoin, Ethereum, back to Microsoft. This third layer, in between a digital asset and a stock, like with a GOAT and StockX and RallyRoad, RallyRoad we're an investor in, or the ability, like with a company like SecFi, which we backed in Fund III, the ability of bringing liquidity

• 38:15Speaker 02

  to actual assets in a wallet-type environment, like RallyRoad's doing, or StockX, where you can, where you don't want to move all the way into digital, but you want to have eight cars, or you want to have a piece of your eight cars, or some art, and some Jordan shoes, and you want to be able to see that all in one wallet as an individual, is a pretty cool idea to me. So that, that stock market of everything, the people that can solve that as a watch list in a wallet are really interesting to me, where I can really, in a good UI, see where all my assets are, and like, how diversified I really am, is pretty cool.

• 38:55Speaker 02

  Does that help you?

• 38:58Speaker 00

  No, it does. I guess I want to kind of go a little bit further on this, right? So one part that I probably over-rotated on from a timeframe was this idea of the tokenized securities. So the thing that you just described of the ability to go from true cryptocurrencies, you know, Bitcoin, Ethereum, etc., and go into stocks, real estate, some other asset.

• 39:21Speaker 02

  I'll give you a perfect example. So Tom and Gary, my partners, fucking smart guys, right? And we were laughing.

• 39:27Speaker 00

  Who's smarter? Who's smarter, you or him?

• 39:31Speaker 02

  Well, Tom is, they're both smart. Listen, like when you built the stereo system at your bar mitzvah, when I was 13, I had a Lloyd's stereo system. People used to say, "Your system's only as good as the weakest component in your system." So you've got like a thousand dollar subwoofer and eleven dollar speakers, you've got an eleven dollar system. So when we invest, we like to be the dumb, we like to be the dumb investors in the deal, obviously, because we don't want to fucking have everybody rely on us. And that's why the party rounds have ended. But I think Tom is, you know, I call him our app, right? Tom does everything. Gary is more like me. He's more front-facing and has an experience around enterprise. And I'm the guy who's like front man. It's like a band.

• 40:15Speaker 02

  And so I don't know if it's smarter or dumber, but we each have a unique thing. But they rely on me. These guys, like Howard, what should we do with our stocks? What should we do with this? What should we do with that? And then Bitcoin comes along and they became the experts, right? I all of a sudden was the dumb guy. And I remember this, like forgetting my nephew making money and all the nonsense on Twitter. I remember my two really smart partners who rely on me for everything. If I say sell Apple, they sell Apple. If I say buy this, they buy that. All of a sudden, I'm an idiot. "Hey, guys, I'm selling some Bitcoin at 7,000. Ha ha, you should be buying." Okay, I'm selling some at 8,000. Ha ha.

• 40:55Speaker 02

  You know, like all the way up, I was selling. And they were not listening to me. All of a sudden, they knew more than me. And I think the fact that they couldn't quickly move their money into, like, I was buying watches, I was just trying to buy shit. I was doing, putting money in private deals, I was buying fucking, I was on GOAT buying shoes. I was just trying to get out of Bitcoin, and I didn't want more stocks. I just wanted to buy hard assets. And that's when the light bulb went off in my head. It's not only do I want to buy hard assets, I'd like to be able to buy hard assets that were liquid enough for me to sell. You know, even if I take a 20% hit on a watch, it's better than an 80% hit on Bitcoin.

• 41:37Speaker 02

  So I think this world of like physical meets digital meets cash flows from stocks is just blowing my mind. I think people are just gonna fucking buy into what is happening. And there's gonna be all these financial service companies that allow you to move in and out of all these esoteric and regular assets in one app.

• 41:59Speaker 00

  Do you think that it becomes commoditized? So let's say that that thesis is correct. I tend to agree that there will be one single location. Think of it as kind of a blend between a bank account and a brokerage account. You're able to put multiple assets in there and you can trade in and out of them and do all kinds of crazy stuff that that would be great for individuals in the financial system. But does it become so commoditized that there's very little difference between them? And so it's really a fight over kind of either fees or some sort of, you know, pricing war? Or do you think that there can actually be differentiation that can kind of set one or two out head and shoulders above everybody else?

• 42:41Speaker 02

  No, I think just like banks before, there'll be hundreds of them, right? Like, I don't think, I don't think there's one app to rule them all in fintech or one bank to rule them all or one, it's not Coinbase or Robinhood or, or Etoro or Acor, you know, I don't even know if there's anything else interesting yet. But, um, so I think we're early days. I have no idea. I think just, I don't think the branch makes sense. You know, I, you know, I saw a number from Wells Fargo that said, uh, you know, they're still mailing 70% of people still want statements, somewhere between 50% and 70%. You know, my mind was blown. I'm like, we've got to be really patient. This is why crypto was like also a telltale sign.

• 43:25Speaker 02

  Why I was like really nervous last fall is like 70% of America still wants their goddamn statement mailed to them. There is no way that these new fintech companies can, can, can work within the realm of middle America, right? So I think everything just got so far ahead of itself. And I think we've got to go back to the basics and say, how do we solve problems for real Americans? Right?

• 43:50Speaker 00

  Ready for a wild stat for you? I believe this is still true. When ATMs came out, everyone was screaming and yelling that it was going to be the end of the bank teller and the branch and all that. There are more bank tellers today than ever in history.

• 44:05Speaker 02

  Okay, and I believe that, but I'm saying the bank teller will change, just like there's WeWork, just like there's The Wing in New York, I think, why can't there be, why can't, like for example, Stocktwits, I've talked about this, or Rowley Row, why can't there be retail locations? Why can't social meet, why isn't there, you know, Schwab built their own stores? But that's dumb, I don't want to fucking hang out with just Schwab people in like a Schwab named building, why can't there be a WeWork for money? You know, something that I've talked about and talked to entrepreneurs, I want to see built, why, you know, and there's a company in New York called, there's a company in New York called Financial Gym, uh, which is a startup, right? Like, these are interesting ideas, why shouldn't the branch be a place where people can go and

• 44:47Speaker 02

  actually talk about, and watch, you know, talk about money all the time?

• 44:52Speaker 00

  What you're describing, though, is the community is the most defensible part, right?

• 44:59Speaker 02

  It's the most defensible, the thing about community that sucks is you're not going to get good valuation, look at Twitter, look at Reddit, look at Stocktwits, even though we're great products and have, people love us, we're never going to get valued properly because of the Nazis, and I joke about the Nazis, but I'm saying, you know, if I go on Stocktwits and just start talking about Nazis, I like Nazis, I'm fascinated by Nazis, you know, maybe they weren't so bad, all of a sudden, Stocktwits community that I've built for 10 years may become like a shit show. And so, communities are really fragile, and I think that we've taken that for granted, and, you know, I'm always mad at Jack at Twitter, you know, because of the way he's let these things kind of infiltrate under the auspices of free speech, you know what I mean?

• 45:41Speaker 02

  These communities are not having rules, that's the problem, they're not, they're not, they're, they just keep changing the rules of what behavior really is, and I think communities need rules, and so, I think there'll be hundreds of them, that's why I don't think there's one rule in all, I think there's, I think there's going to be communities for money, where people, you know, trust centers, that people, you know, I just don't think it can be cornered, I just don't think this whole thing can be cornered, I think why Robinhood's worth so much is because they're providing a service that appeals to millions of people, like Amazon Prime, and so, they have the early lead, um, but that's how early we are, I mean, they, they go down for three days, all of a sudden, there's no switching costs, and there's another Robinhood that looks and feels like Robinhood and promises this, you

• 46:25Speaker 02

  know, 3 million accounts will switch, so we're still early days.

• 46:29Speaker 00

  It fascinates me, talking about Twitter, one of the things that Facebook did a great job of on the advertiser side was turn it into a platform, right? So they basically said, look, you can come in self-service, you know, auctions, the whole nine yards. One thing that I've always thought Twitter could have done that would have been really interesting is if they had created a platform strategy for communities. So, you know, you probably would identify-

• 46:54Speaker 02

  Why I created the dollar sign was like it was a no-brainer for them.

• 46:58Speaker 00

  Yeah, well, and think about if you could create like a fin tweet and actually coordinate it off. And it had to be, somebody in the community has to vouch for other people who get invited into the community, and then you just have the same Twitter experience, but it's in like a semi-walled garden.

• 47:16Speaker 02

  We did that on Slack, right? We launched Room, which is kind of like Telegraph within StockTwits. You have to, each community can set up its room. So that, that, that helps you grow. Like, again, I don't know if we'll have scale to do it, but we, we've launched it and they've done a great job, the team. You know, I'm just chairman, I'm not operating, but Justin, who created Rooms on StockTwits, you get the best of StockTwits, but if you're unhappy with the community, go start your own community. And it's kind of like why Discord worked for gamers and why Slack worked for work, right? There's not one to rule them all. I think communities are fascinating, like you said, but it's a really hard business. What made, so this goes to why Robinhood was valued at 6 billion

• 47:57Speaker 02

  recently. Not only did they build a utility, they also built a service that disrupted the business model on top. I think Uber has done a great job in the last two, three years, building services on top of the utility, whether they're trying different packages or whatever. I mean, I got the numbers that I'm spending on Uber and I'm like, I'm crazy. But yet I have no complaints about the product. So I think Uber could get into the financial business much easier than anybody else, right?

• 48:27Speaker 00

  What about, what about Facebook?

• 48:30Speaker 02

  I'm bullish, and here's why I'm bullish on Facebook. I hate, I've never liked it. I, you know, I've never liked the team. He looks like a weird dude. Let's, you know, go through all that stuff. But they have it, the fact that they had the nerve to risk their business and go and build the constellation like WhatsApp and Instagram. I mean, they could go spend 15 billion on Robinhood tomorrow and be, and everybody would forgive him because Robinhood's such a good product. And they could be in the financial business. Do they have the nerve or the, to do that? Well, they should. They should go out right now and make an incredibly bold acquisition like Shopify or Robinhood. And just stake a claim in another corner of the world with a constellation of apps and leave it alone like they did with Instagram.

• 49:12Speaker 02

  Okay. Will it end up great? I don't know. But that was, that's their way out of this hole is to buy their way out of this hole. The other way is to just be a value stock, which I don't think is what he wants, which is just to be Philip Morris, which is to, you know, fuck the US. Excuse me. Fuck the US. We'll just worry about Indonesia and, you know, we don't, you know, they have a huge international business. They're not even an American company at some level. So.

• 49:36Speaker 00

  The, the two things Facebook, I think, so I agree directionally with you that they can buy their way out or kind of take a bold bet in another industry. To me, it's finance or health. It's the only two areas that they can go into with, you know, relatively high probability of being somewhat successful. It's bold enough to change the narrative and there's great advantages from their engineering kind of DNA that they could bring to actually changing or creating value in those industries.

• 50:07Speaker 02

  Yeah. I mean, back in the day, I was 708 when I was fascinated by Twitter and I was an investor in TweetDeck and Bitly and BetaWorks. You know, indirectly through some eyes. So I had a lot of Twitter shares myself was like, why aren't they Bloomberg? Like forgetting. And we can go back to this today. They had TweetDeck, they had all the data, they had their own data. The only, the biggest mistake Twitter's made, and they've made hundreds of big mistakes, and little one, is that they cheapen their own data by selling it to the people that would pay the most. The people that their data disrupted the most, they didn't understand, and that's Bloomberg, Reuters, the, the press release companies. Twitter is a press release company. You know Warren Buffett owns Business Newswire.

• 50:49Speaker 02

  That company makes billions of dollars doing nothing. That is Twitter, right? You know, you sell your data to Bloomberg for a hundred million a year, you know, the head of sales comes back and go, "Look Dad, I got a great sales deal." Bloomberg behind the scene, you just say Bloomberg because now they have the data and they didn't have the data before. So, and Bloomberg charges two, Bloomberg is a social network, right? They sell their, their social network for $2,000 a month to rich people. You know, people that, that need their data. Twitter had all that and more and could have done it at a much lower price and in a much broader scale and internationally. And instead, you know, they, they cheapened it by selling it to the very people

• 51:30Speaker 02

  that, that they should not have sold the data to. A lot of broker dealer and, and fan, and, and got into the, they should have gone into gambling and finance. And, and that's where Twitter could have been a hundred to $200 billion company. And I think at best it can be, until they get into that transactional side of the business, I always feel they'll be undervalued because they're going to be like more as a community than as transactional.

• 51:59Speaker 00

  Got it. What, what's, um, what's your view on Bitcoin and how it fits into, uh, the, the financial world?

• 52:08Speaker 02

  Well, I mean, I rely on a few investments I made. Yoni Asia, who you should interview for sure. Have you interviewed Yoni?

• 52:14Speaker 00

  I have not.

• 52:15Speaker 02

  Okay, so I'll introduce you. That'd be a great interview for you because he's much wise. I go to people that got me into it earlier than me, right? Like, I feel like Yoni in 2010, who was, you know, in 2011, was buying Bitcoin at 12 cents and still holds some today. Those are the people that I prefer to talk to, and so I talk to Yoni via WhatsApp or whoever. You know, I'll see him next week for dinner in New York. But the way they think about it around just the financial products, just around, you know, settlement, just around packaging of financial products is what I believe in. You know, the rest, everybody can have, you know, have their way at it.

• 52:58Speaker 02

  But I think I've only ever believed it as a disruptor to financial systems, not as payments, not as, you know, hoarding, not as hodling, blah, blah, blah. That and the blockchain were about to get rid of what happened in 2008. Rebuilding of trust, where we've gone with it since is some butchered idea of it's going to change the world. So I still believe around, you know, the areas where Wells Fargo, JP Morgan, real estate, stuff which I just is so, I don't trust and is heavy with paperwork. I think crypto and blockchain have a thing.

• 53:41Speaker 02

  I think around getting it into people's hands where they can really understand it, like CoinMine is doing right now, is cool. Like, an easy bake oven for crypto like CoinMine is. Like, let me understand how it's made. Let me have my first savings account that actually works. And I don't have to remember passwords. And yeah, the bank takes its fee, CoinMine will take its fee for storing it and everything else. But that seems fair, right? Like, everything can't just be free and lollipops. Like, people have to make money and there are services provided and, you know, trust built. And so I think we're taking a step back towards like, hey, how did this all start? How do I get this stuff in my hand? How do I try new products?

• 54:26Speaker 02

  And I think we're square one there, and I'm excited about that.

• 54:33Speaker 00

  Got it. What um, what's your biggest fear in the current like macro environment or investing environment? Is it public equity sell-off? Is it something in the private markets around venture? Like what keeps you up at night?

• 54:50Speaker 02

  You know, what keeps me up at night is running out of Ambien. So it's just a known fear of mine, because I'm sadly reliant on a sleep problem. The uh, but the only thing that keeps me up at night is just stupidity, right? Like I really ner- I mean, you know, power and government and stupidity, right? Like, it bugs me that I think Trump could have a 90% approval rating and chooses to have a 38% approval rating. That just scares me. Because what is he thinking? Like, America likes to play ball. Like, we like kumbaya. We don't necessarily need to be fighting over every little thing. And so that scares me. I mean, that's the only thing that scares me. It's like, what the hell's going on in

• 55:34Speaker 02

  the heads of our leaders? And they seem to be playing with fire. And I don't know, when I, when I get nervous about stupid stuff like that, I never, I've never been nervous about politics. So I'm 53 years old, never watched CNN or MSNBC, and for some reason, I'm like, and I'm not an MSNBC, I'm not even a left or right, I'm more, I'm more right-wing than I am liberal. And I feel like I don't, I just don't understand what each party stands for. So I think politically and government-wise, the fact that the, Trump can say, I'm gonna do a tariff on the iPhone, when he may not even, he just could be floating that idea, is just dangerous. You know, just reckless comments about the market and around companies

• 56:18Speaker 02

  and picking winners at the government level. I know it happens, but I didn't, I've never seen it done this way. And so that's

• 56:26Speaker 00

  And I'll even put that comment on steroids, right? Because I think the the part that I I agree with you on that I've never seen before. And again, you you've got, you know, much more experience than I do is just I've never seen somebody be able to go from idea to impact on the market so quickly. But I think the

• 56:44Speaker 02

  But that's Twitter more than Trump.

• 56:45Speaker 00

  Of course. I was just gonna say, I was just gonna say that where I first saw this was Carl Icahn. Right? I remember one of the first times I ever saw where he was using Twitter to basically announce things.

• 56:58Speaker 02

  Yeah, he got it. He got it. But he abused his power, and that's why he has no power anymore. Meaning, it only works if you're right. Trump doesn't care. So he doesn't care if it goes up or down. He just likes the impact. What Icahn did, and he fucking blew it, was he he was too self promotional, right? Like he's in the markets, you're gonna be wrong a lot. So if you come out with your bullshit, like this is this, and I'm attacking this company, people see through it rather quickly because you're gonna, even if you're the best, you're gonna be wrong. What makes Trump great, and this is again, like Dave Chappelle said last week, it's not, it's not about Trump. He's riding a wave that was given to him in a non Twitter world. He's just a fucking TV guy. And we see how he is on TV. He's a blathering orange idiot.

• 57:44Speaker 02

  No one can defend the guy when he has to put five sentences together. On Twitter, he's entertaining because the platform is great. And the ability that he's in control of the paparazzi, not the paparazzi in charge of him. So it is him, it is the platform. This goes to Twitter being underachieving again. The fact is, if you're gonna keep Trump on there, make it worth my while as a shareholder. Don't fucking underperform. So.

• 58:11Speaker 00

  So Twitter, ready for this crypto Twitter? I think fintech fintech Twitter as well. It's like the WWF. There's the villains, you know, the heroes, the tag team partners, the, you know, whatever. And everyone is playing a role that's very much a character of themselves or of some, uh, you know, some, some, uh, role they're supposed to fill. And it is so entertaining. And that's why we all tune in.

• 58:36Speaker 02

  That's the logic of the world. But guess what? Completely undervalued. Entertainment is, is underachieving. If that was their fucking goal, kudos. But they have shareholders to report to and they fucking mismanage. They've mismanaged the company from a shareholder point of view. The company, this stock should not be as volatile as it is because they should be tied to the financial markets, not the WWF. That's exactly the point.

• 58:59Speaker 00

  What, uh, what, uh, I got one more question for you and then you could ask me a question to finish it up. Uh, what's your favorite book or the most important book you've ever read?

• 59:08Speaker 02

  You know, we, I don't, not again, books for me are, are, are as a non-tech person and as someone who tries to think more like an, you know, with my eyes and ears, not my, not my brain. Um, you know, I'm a feel type of investor. I like to hang with the people. I'm not a book guy. So the best book is, is Phil Knight's. I love Shoe Dog because it was kind of like he was writing a Bible. He was like a, like a New Testament for branding. He was like saying, even if it wasn't true, it was like Jesus. He was like making, he, he wasn't, he was, he was embellishing, but not to the point where you hated him. He had a lot of human parts of the story. And he was handing that book off to the next generation of Nike saying, hey, while you guys are fighting and bitching

• 59:51Speaker 02

  about your boss, look what we had to do for 40 years to hand you this company. And I thought that was the best business book I've read in a while because it wasn't even that much about business.

• 1:00:03Speaker 00

  I'll, I'll buy that. Uh, I'm going to add to this question because it's you. Uh, who's the best person to follow on Twitter that people may not follow right now?

• 1:00:12Speaker 02

  Oof.

• 1:00:14Speaker 00

  Like who, who's the person that you're like, man, this is great account?

• 1:00:19Speaker 02

  Yeah, my friend Charlie, if you like markets, my friend Charlie, you know, there's a few on Twitter. The people that I check in the most on, I guess Charlie, even though he doesn't post that much, Bilello, because he frames the markets really well and he gives me context for understanding, you know, relative and context around market moves, Charlie Bilello. I also like, because he makes me laugh, Josh Brown.

• 1:00:46Speaker 00

  We had Josh Brown come on, he was ridiculous. He literally told me he believes in ghosts more than he believes in aliens.

• 1:00:55Speaker 02

  I believe in ghosts, I've seen a ghost. I've slept next to my wife who talked to a ghost. And so, even though I can't explain it.

• 1:01:03Speaker 00

  Hold on, you've seen a ghost?

• 1:01:05Speaker 02

  Yeah, and I was in London and we were, they warned us when we checked in that the hotel, we were in the countryside at a wedding, and they warned us when we checked in that our room was haunted, but it was a friendly ghost. And so, obviously, the seeds were planted. And next thing you know, I wake up and my wife's talking to a woman who says she's a nurse and floating around the room, and I immediately got naked because of the potential for a threesome. But, I'm mad, incredibly, of course, the ghost disappeared. As soon as I got naked, the ghost disappeared.

• 1:01:45Speaker 00

  You, me, and Josh Brown are definitely going to record one of these together, because I can only imagine the stories you two will tell each other. All right, what one question do you have for me?

• 1:01:56Speaker 02

  So again, I think what Josh does read, so in the end, the best people that I'm going to follow are people that aren't like me. I don't want to follow people that don't read. I'm that guy. So I like Josh because he reads kind of stuff that I would read if I had the patience. And so, you know, I like to follow people who read. Jim O'Shaughnessy, who's funny as hell, and Patrick, who's interviewed me. People that just read all the time are more interesting to me.

• 1:02:23Speaker 02

  What's his name, Morgan Housel from Collab Fund.

• 1:02:26Speaker 00

  Jim O'Shaughnessy came out of nowhere with the gift game.

• 1:02:32Speaker 02

  Yeah, I feel like I helped make him. I feel I helped make him.

• 1:02:36Speaker 00

  You did?

• 1:02:37Speaker 02

  Yeah, because he's an old man, a little bit cranky. He's like a, he's like a, he's like a, he's like a, he's like a teddy bear. He's so funny. And he's so quick and obviously so intelligent. So when I started seeing his gifts, and now I've like stolen some of his ideas, but he's just a really nice guy, too. And he's, and he's just a good family man. So I really like Jim.

• 1:03:01Speaker 00

  He, he's one of the first guys who ever came on the podcast and he started it out with, I don't know, I don't know, I don't know. Anything about crypto, I don't know. I thought that was, that was the best sign of intelligence.

• 1:03:14Speaker 02

  I, I defer to people who I think know. And that's the only difference of my strategy with Jim's is like, I do believe in expert networks and I do believe some people know more than me. And so I defer up the food chain a lot.

• 1:03:28Speaker 00

  That makes sense.

• 1:03:29Speaker 02

  But you say I don't know a lot, but I do know people who know. I, I pride myself on trying to find people who do know.

• 1:03:36Speaker 00

  That's fair. All right. Let's wrap it up. What one question do you have for me?

• 1:03:41Speaker 02

  Hair products. Well, I know you're young and but it's really fascinating. It's very tight and like, perfect. What, what are your hair products?

• 1:03:50Speaker 00

  Water. Water is the best hair product. It's highly, highly underrated. You and I should start a company where we put water in a bottle and call it some sexy hair product name. And sell it an obscene amount of money and get all the millennials to buy it through Venmo only.

• 1:04:06Speaker 02

  And if you're gonna start, if you were to start a company today, like what, what's the area that you'd focus on? Endless capital and you had permanent capital and where would you focus?

• 1:04:18Speaker 00

  Yeah. So there's a, there's three areas I think are really interesting. One of them is

• 1:04:27Speaker 00

  all around the idea of.

• 1:04:31Speaker 00

  Augmenting our intelligence and brain with computing power. I'm not even necessarily sold on like, let's implant the computers in our brain type stuff. But just, there is so much information in computing power and processing speed, et cetera, around us. How do we drastically change or create an inflection point of human intelligence? Utilizing all that, I think is a really fascinating problem. The second thing is, um, I think that, uh, there's a huge business to be built in changing the way that people think about philanthropy and social impact.

• 1:05:14Speaker 00

  I'm shocked at how many people buy into the idea of giving money away versus the idea of using their capital to create quantifiable change while also doing good, et cetera, right? So I think like what Zuck has done with the CZI is fascinating. Uh, I don't know if it'll be successful, but I do think that there's a really big business there. Because if you can basically figure it out, um, you're able to take most of the philanthropic dollars that go out and, and really change the way that humans and markets and, and kind of assets, et cetera, all interact.

• 1:05:57Speaker 00

  And then the third one is, uh, it really is around this idea of young people and asset management. I think the system is completely broken. So maybe not like necessarily a bank as much as it is how people are educated, how people, uh, think about managing their assets, how people, um, look to others for that information. I am shocked, for example, today, how many high school graduates leave school?

• 1:06:30Speaker 00

  And do not know how to do simple things like balance a deck book, understand, you know, assets and liabilities, just all the personal finance stuff. And so I, I am at the camp that machines and software will probably change what all that looks like over the next 10, 15, 20 years.

• 1:06:48Speaker 02

  Yeah, just basic budgeting.

• 1:06:50Speaker 00

  Yeah, but advice as like more automation type stuff happens.

• 1:06:54Speaker 02

  Google Maps finance, we need that Google Maps finance, like something right turn. Like I just did this, you know, what are my choices?

• 1:07:03Speaker 00

  Yeah. And I think the finance or the advice piece becomes more valuable, right? So here's the thing that I thought a lot about now, but everyone talks about automation, like, oh, it's going to end the world, right? So we're automate away lawyers, we're going to automate away financial advice, we're going to automate this and that and whatever. And let's just, you know, we'll, we'll just concede that that will happen, right? And maybe it does, maybe it does. But let's just say it does happen. I actually think that if the lawyers like workflow gets automated, lawyers become more valuable if they give good advice, because that's really what separates most good lawyers from everybody else. And people forget that it's not that lawyers are going to go away. It's just that the bad lawyers are going to go away.

• 1:07:46Speaker 02

  The travel agent, still really successful travel agent.

• 1:07:50Speaker 00

  Absolutely.

• 1:07:52Speaker 02

  So yeah, I agree with you there. I think Google Maps of, of, of advice is coming, right? Like you can have all the machines you want, but you're still going to trust a person that tells you how to do right turns and left turns. And there's no perfect way to get anywhere in finance. There's just the end and the beginning. And so I agree with you there. I think that's, that's good focus for you.

• 1:08:13Speaker 00

  Yeah. So we'll see. All right, sir. Thank you very much. We'll do it again.

• 1:08:18Speaker 02

  When do we go live with this?

• 1:08:19Speaker 00

  Uh, we, we actually, it hasn't come out yet, or maybe it'll be out by the time this gets posted, but we recorded the first live podcast last night with CEO of Kingdom Trust. It went very well. So when you come to New York, we can definitely set one up. My only request is that you, you don't try to be funny. You just do it naturally.

• 1:08:40Speaker 02

  Yeah, I don't, I don't know. I don't know. When will you post this? When will you post this interview?

• 1:08:47Speaker 00

  Uh, this will get posted in the next two weeks.

• 1:08:50Speaker 02

  Okay, let me know.

• 1:08:51Speaker 00

  I might, I might expedite it just because you told me that you saw, seen a ghost.

• 1:08:56Speaker 02

  I seen a ghost and I stripped in front of it.

• 1:09:01Speaker 02

  If you see a ghost and it makes you nervous, get naked. That is my advice.

• 1:09:05Speaker 00

  That's perfect advice. All right. Thank you, sir. All right. You reached the end of the podcast. Congratulations. I appreciate you listening all the way to the end. You deserve a trophy. But before I hand out the virtual trophies, remember to go visit blockFi.com/pomp. They're the crypto lending leader in the US. They do it in 45 states, interest rates as low as 8%. And you can use the US dollars funded directly to your bank account to do whatever you want. You should definitely go visit blockFi.com/pomp. You know you want to do it, so just do it. BlockFi.com/pomp. Before I let you go, though, I wanted to mention Draper University one more time. Remember, Tim Draper is one of the most legendary venture capitalists in the world. He's funded many of the biggest companies that you've heard of.

• 1:09:51Speaker 00

  Today, they have two separate programs around blockchain at Draper University. The first is for entrepreneurs looking to get their idea off the ground, who can attend their pre-accelerator program. And the second is a week-long intensive program for corporate executives looking to learn about blockchain and crypto. You can check out draperuniversity.com and apply there. The deadline is approaching fast because the programs are in January and February. So definitely check out draperuniversity.com. Again, that's draperuniversity.com. And one more time, draperuniversity.com to make sure that you can apply. Thanks so much and I'll see you next time. Hey, everyone. Pop here. If you liked this episode of Off the Chain and want to help us take crypto to the top of the apple,

• 1:10:32Speaker 00

  Spotify and other podcast charts, please do us a favor and rate, review and subscribe. To review, simply go to the Off the Chain homepage, scroll down until you see the five blank stars. Taking 15 seconds to fill those stars in and leave a quick review goes a long way in helping us take the entire crypto ecosystem to the top of the charts. I appreciate you listening and see you next time on Off the Chain.