Keith Rabois: Lessons from PayPal Mafia, $OPEN, & Investing

Keith Rabois https://x.com/rabois, Opendoor ($OPEN) co-founder & newly appointed Board Chair, Managing Director at Khosla Ventures, & a core member of the PayPal Mafia, joins Sourcery for a masterclass on talent, culture, and contrarian thinking. “You don't want to be the best in the world at what you do. You want to be the only one who does what you do.” Paraphrasing Jerry Garcia, The Grateful Dead He shares how he scouts extraordinary individuals, why every successful startup begins as a cult, and the frameworks he’s developed to simplify complex problems into actionable advice. From the Barrels & Ammunition metaphor to building Olympian-level work cultures, Keith reflects on lessons from PayPal, Square, Opendoor, and Khosla. We also dive into his takes on stress, sleep, and performance, his potential book, and why he believes venture capital is the best job for the intellectually curious. Book Recommendations: • Upside of Stress • High Output Management • The Score Takes Care of Itself 1. Keith Rabois: https://x.com/rabois 2. Molly O’Shea: ⁠https://x.com/MollySOShea⁠ 3. Sourcery: ⁠https://x.com/sourceryvc⁠ Brought to you by: • Brex https://brex.com/sourcery—The modern finance platform, combining the world’s smartest corporate card with integrated expense management, banking, bill pay, & travel. As a Sourcery Listener you get: 75,000 points after spending $3,000 on Brex card(s), white-glove onboarding, $5,000 in AWS credits, $2,500 in OpenAI credits, & access to $180k+ in SaaS discounts. On top of $500 toward Brex travel, $300 in cashback, plus exclusive perks (like billboards..) visit → https://brex.com/sourcery • Turing https://turing.com/sourcery⁠—Turing delivers top-tier talent, data, and tools to help AI labs improve model performance—and enables enterprises to turn those models into powerful, production-ready systems. Visit: https://turing.com/sourcery • Kalshi https://kalshi.com/sourcery⁠—The largest prediction market and the only legal platform in the US where people can trade directly on the outcomes of future events: https://kalshi.com/sourcery Follow Sourcery for the latest updates! https://www.sourcery.vc/

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

• 0:00Speaker 00

  You have to find what your comparative advantages in life and then double and triple down on it. Each of the people that worked at PayPal that was talented had different skills and traits. The reason why they went different directions is they figure out how to frame themselves. So they're not just the best, they're the only. Peter, not many substitutes for Peter. Max, not many substitutes for Max. David Sacks, I think, has found his own roll off.

• 0:22Molly O'Shea?

  You were a part of PayPal mafia. I have to ask, do you guys have a group chat?

• 0:26Speaker 00

  No. One of the two best parts of being a VC is you get to work with the most talented entrepreneurs in the world and you get to watch them. I have actually given a whole speech on lessons I've learned from Vinod, Peter Thiel, Reid Hoffman, Max Levchin. But I try to absorb from everybody.

• 0:39Molly O'Shea?

  What traits do you look for in talented young individuals?

• 0:42Speaker 00

  What you want to find is someone has a non-zero chance of changing an industry of the world. That's it.

• 0:47Molly O'Shea?

  You are also very active on X. But I have noticed since joining Coastal again, your contrarian takes have, I mean, I'm not going to say they dulled down, but like you have gotten a little bit more mellow.

• 0:58Speaker 00

  Oh my God, I'm getting old. Damn it. My thesis is I ran out of contrarian takes because they've all been proven to be true.

• 1:03Molly O'Shea?

  Have you thought about writing a book?

• 1:04Speaker 00

  I've started to play around with ChatGPT to write a book for me. The outline it came up with is actually pretty damn good. The title was very non-intuitive and kind of edgy, which I liked. It's called.

• 1:21Molly O'Shea?

  One of the common themes that I've noticed around you and your circles and in Doge, the new admin, is embracing young talent. So in Doge, hired really young. Thiel Fellowship hired really young.

• 1:38Molly O'Shea?

  There's different mafias around this too. But for you, I asked Delian, like, what should I ask Keith? And, and Delian, he said, he's, he told me to ask you, what do you see in certain young folks? That convinces you to spend so much time mentoring them?

• 1:53Speaker 00

  It's the same thing as investing, truthfully. It's the same formula. What you want to find is someone has a non-zero chance of changing an industry of the world. That's it. It's really that simple and it's the same uh you're scouting for professional sports. You're scouting for music labels. It's the same basic concept is most people are in the middle of the bell curve. And either don't have the skill or ambition to be two standard deviations away. Investing is all about finding those people and giving them either capital or advice or both. The same thing, whether you individually mentor someone is the exact same formulation. If someone has super high potential and has a shot of transforming the world. So try to find them. It gets harder.

• 2:36Speaker 00

  The assessment part actually, I think, gets easier. The identification part is harder. It's not like you get to meet all four billion people on the planet. Hmm. I've yet to find a way to do that. Um, my friend's Daniel Gross and um, you know, uh, actually back in the day tried Pioneer, which is a way of scaling the identification of these people. And it had had some success, I think, but I've found that you need to do it in person, which really reduces the scalability of it. And the disadvantage is as you age, your natural, social, professional, personal networks are more distant from up and coming people. So you have to find alternatives to that.

• 3:20Speaker 00

  For a while, now I'm even too probably dated to use this. For a while I used my soccer team. Uh, as a way, as a way to find up and coming talent. It worked pretty well. Um, hired two, at least two people off, off my soccer team that worked at Square. They started a company that's a very good company called Fair. Hmm. Um, so, but it, it was a good magnet for people. You can, you can try to find new alternatives, but it gets difficult. You can rely upon friends of friends. Um, and there's some truth to that. You know, the outage that you're the average of the five people you spend the most time with is basically true. So if you find one node, one person is a node, the five people that that person spends the most time with, there's probably some pretty other talented people in that group.

• 4:05Speaker 00

  So you can try that. Um, but the technique of identification, you can reach social media. People who are exceptional sometimes publish stuff. My other co-founder at Open Door, Ian Wong, I'd actually read his Quora posts and didn't know idea who he was, just read some of his Quora posts back in the day. And I bumped into him at a professional event in San Francisco. And he introduced himself and asked for career advice. And I said, your only career advice is I have a job for you. Starting on Monday at Square. And he was like absolutely blown away. Like I was like, nope, you don't have a choice. Like I've got a job for you. And he's like, don't I have to interview? I'm like, nope. And the reason why is I'd already read all his content and I could see from his content.

• 4:48Speaker 00

  And like his education that he had a confluence of interesting ideas and backgrounds. And I was like, if I can't figure out how to make you useful, like it's Square and my problem, not the other way around. He had, he had electrical engineering and a CS background and a data science background. Like, we do all those things. There must be something for you to do here. We only have like 30 people. Like I've got, it's unusual that someone like with that background walks into my lab, please start Monday. And he did. And, you know, he wound up then later co-founding Open Door with me, stayed nine years as CTO. And now he's running a really cool company in Seattle.

• 5:25Molly O'Shea?

  You're gonna bring him back?

• 5:26Speaker 00

  Sorry?

• 5:26Molly O'Shea?

  You're gonna bring him back?

• 5:27Speaker 00

  Uh, no, his company is doing very well. Like it's, it's not announced yet, so I won't talk too much about it, but it's got very high potential from what I can tell.

• 5:36Molly O'Shea?

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• 6:21Molly O'Shea?

  Companies like Scale AI, DoorDash, Service Titans, Hims, Anthropic, Flexport, Robinhood, and Plaid. Trust and use Brex. Start today at brex.com/sorcery. That's B R E X dot com slash sorcery. So what traits do you look for in talented young individuals?

• 6:42Speaker 00

  I think it's really easy to describe conceptually, which is there's only, there's two formulations. One is you are in the top, call it one to 10 basis points on some specific trait. And that can, they can be very different. You can be the smartest person I've ever met. You can be the most tenacious person, persistent, best salesperson, best at assessing people. Like you have some trait that's just like, holy cow, I've never seen anybody like that before. Your ears are just like perk. The only other formulation I've seen is you have this combination of traits that's rare. The confluence of traits. So we talked about cows, for example, I mentioned he's bold and ambitious. And at the same time incredibly rigorous and analytical. Those traits do not usually go together very well.

• 7:24Speaker 00

  But they happen to be magic. It's not surprising. He was very effective in the financial services, building out shop pay, et cetera. Because those traits are like indispensable for building a payments innovative company. They're also truly indispensable for building Open Door successfully. So you're looking for this rare combination. I talked about Max Levchin is a first rate technologist and a first rate business strategist. There's less than five of those people in the world. So if you see these rare traits as a Venn diagram, that can be your like sort of top one percent answer. So that's what you're looking for.

• 7:57Molly O'Shea?

  An early talent circle that you were a part of was PayPal mafia.

• 8:01Speaker 00

  Yep.

• 8:01Molly O'Shea?

  We now have multiple mafias. We have the Teal mafia, the Teal fellows mafia. There's now the Palantir mafia. Somehow they all come back to the same people. Um, I have to ask, do you guys have a group chat? Do you have a group chat?

• 8:15Speaker 00

  No.

• 8:16Molly O'Shea?

  Do you keep in touch?

• 8:17Speaker 00

  Well, I keep in touch with the people I like and you know, the um, Like I'm going to Max's birthday Saturday and I'll see I'm sure a select group. But I would say there's a constellation of maybe from the PayPal days, 10 to 30 people. Uh, where we're pretty interact, you know, obviously I've worked a lot professionally subsequently with Max and Peter. And David Sacks. And so I think there's concentric circles of people who continue to work together, continue to start friends. But not like there was like 254 employees when we sold the company in Mountain View. And I don't even touch with most of the 254.

• 9:00Molly O'Shea?

  What do you think you've learned from watching everyone go on their own path?

• 9:06Molly O'Shea?

  Like, what are the key lessons that you've taken away from? This person went that way. This person went that way. What like, I think more macro of like human behavior.

• 9:15Speaker 00

  Well, macro human behavior is, I think you have to find, and it's advice I give people. Constantly, probably every week, what people want professional advice. Uh, and even people don't want it and I sort of force them to listen. Uh, is you have to find what your comparative advantage is in life and then double and triple down on it. So each of the people that worked at PayPal that was talented had different skills and trades. And I think the reason why they went different directions is they figured out how they wanted to compete with the rest of the world. So I was mentioning, you know, I grew up reading this bio autobiography by Pat Riley. Um, and in the autobiography I read when I was probably a sophomore in high school.

• 9:57Speaker 00

  I saw this quote that he was quoting Jerry Garcia, the Grateful Dead and said, you don't want to be the best in the world at what you do. You want to be the only one who does what you do. And so I think that's mostly people who are successful. They figure out how to frame themselves. So they're not just the best, they're the only. So Peter, not many substitutes for Peter. Max, not many substitutes for Max. David Sacks, I think, you know, has found his own roll off. You find your own course and you double and triple and quadruple down on it. And that's how you want to be successful.

• 10:29Molly O'Shea?

  Can I ask for you a little bit more personally? Like you have developed some really strong frameworks of understanding and breaking down different situations, very complex situations. How did you, how did you, how do you like have this like really, I guess, like clear and insightful way of viewing the world that you can distill complex subjects, subjects down so easily?

• 10:54Speaker 00

  I think my primary role as a venture capitalist is to be a consigliere to the founder. And even as an executive, I think this, this skill is critical, which is simplifying a complicated set of facts to an actionable framework. That's the best way to give advice and take a step back. Communication, I think, is misunderstood. Communication is only effective, you're only successful communicating if the recipient understands what you're saying. So it's like throwing a basketball pass. It's the, it's the person who throws the pass, the responsibility to make sure this, the recipient catches the pass. You don't blame the recipient for fumbling the ball. It means you didn't throw it, you didn't pass the ball correctly.

• 11:36Speaker 00

  So you want to take into account the qualities and characteristics and attributes of in basketball, seven foot center, you don't want to give them a pass that's like six inches off the ground. That's your responsibility. So the same thing's true if you're communicating with people and you're trying to be a useful mentor, consigliere, advisor. You need to be able to distill things in a way that the recipient can apply. And so if I want to be successful as a consigliere, I need to be able to translate things.

• 12:05Molly O'Shea?

  Is this why you're so popular on All In?

• 12:08Speaker 00

  Well, we'll see. I mean, hopefully it works. You know, Peter's very good also at conceptual frameworks. He's published a whole book that has a bunch of them. But I, I try to be able to either by metaphor or by framework, be able to articulate and translate a fairly complicated topic.

• 12:25Molly O'Shea?

  Yeah, it's very impressive. It's also kind of like mesmerizing.

• 12:28Speaker 00

  For example, the barrels and ammunition one.

• 12:30Molly O'Shea?

  Yes.

• 12:30Speaker 00

  Did very well. So the, the question that I was encountering constantly from founders was,

• 12:38Speaker 00

  Basically simplified as I hired all these more people, I raised money, I raised, I hired a bunch more people. Yet I get less done and it's very frustrating. Why? And so distilled it into this barrels and ammunition concept that makes a lot of sense why, oh my God, I've hired, you know, doubled my engineering team, but I'm getting less done, or I've tripled my entire, you know, team. And I'm getting less done. It's because you don't have any more barrels. You're just stacking ammunition behind the same number of barrels. So you're not going to get any more done and you're just going to frustrate people.

• 13:08Molly O'Shea?

  Have you thought about writing a book?

• 13:10Speaker 00

  Uh, I always get asked to write a book. Before chat GPT, I thought the work, the work effort would be too high. I have started to play around with chat GPT to write a book for me. So we'll see the, actually the outline I came up with is actually pretty damn good.

• 13:25Molly O'Shea?

  Do you want to share?

• 13:26Speaker 00

  Yeah, they had eight chapters. They were really pretty good choices. The title was very not intuitive and kind of edgy, which I liked. It was called Dangerous Minds.

• 13:34Molly O'Shea?

  Ooh.

• 13:35Speaker 00

  So we need to trademark that one quickly.

• 13:37Molly O'Shea?

  Yeah, before this podcast airs.

• 13:39Speaker 00

  Yeah, we're gonna get that trademarked down.

• 13:42Molly O'Shea?

  That's really funny. So.

• 13:44Speaker 00

  I need to keep accomplishing things. I definitely want to make sure, you know, that the book is interesting and that. Cause the tension, the reason why I've always procrastinated, other than the effort, the serious reason is if you want to make it actionable, it needs to be specific. But if you make it too specific, it's not like a universal book.

• 14:03Molly O'Shea?

  Right.

• 14:04Speaker 00

  There's only so many people in the company and in the world are trying to build a startup from scratch to like IPO or something like that. And so if I dumb it down to be broad, then it's not that useful to people who are aspiring entrepreneurs. If I make it actionable to aspiring talented entrepreneurs, how many people in the world are going to buy this book? So trying to finesse that balance.

• 14:26Molly O'Shea?

  Are we going to wait until after the open door turnaround?

• 14:29Speaker 00

  That might be a good idea, or you know, maybe, maybe when Ramp goes public or something, or, or, uh, you know, some big moment that crystallizes everything, but I still need to solve this tension of making it useful to a wide set of Americans or worldwide, wide set of readers. And being, uh, specific and tangible, concrete enough that people were very good. Who already know what they're doing, find interesting advice in there.

• 14:58Molly O'Shea?

  I feel like you're already there. Like, business is one of the top-selling categories for books.

• 15:04Speaker 00

  It is, actually. And I think it could do fine. It would probably do well, but I don't want to do it unless I figure out how to make it like both a bestseller

• 15:17Speaker 00

  and concrete for top-tier founders.

• 15:21Molly O'Shea?

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• 16:05Speaker 00

  Yeah, I think that's true. It's getting, some things are easier, certainly crafting it through ChatGPT. But the next step would be for me is to take one of the better chapter titles and ideas and ask you to write that chapter. But the more I do the podcasts like this, the more I, you know, do media interviews, the more content there is for, you know, ChatGPT to train on. So that's why I'm doing this.

• 16:28Molly O'Shea?

  I'll give you the transcript. I'll give you the transcript. It's all training data. Well, talking about more specifically of like one of your superpowers, it's around culture and shaping cultures. There was one interview that I love. I think I tweeted about this. It was one that you did with Mike from Trava and Harry Sevings on 20VC.

• 16:50Speaker 00

  Oh, yeah, sure.

• 16:51Molly O'Shea?

  This one was fantastic. This was before like 996 became back in fashion.

• 16:56Speaker 00

  Yep.

• 16:56Molly O'Shea?

  Which I think is like kind of bullshit. I think it's more than 996. But there was one part where you were all talking about building an elite culture. You need to build like Olympians.

• 17:06Speaker 00

  Yep.

• 17:07Molly O'Shea?

  What is your framework for that?

• 17:08Speaker 00

  Well, the framework is every, every, it's actually borrowed from Peter. Every successful company is a cult. And what a cult really means is you have a view about the world that's different than other normal people.

• 17:19Molly O'Shea?

  Hmm.

• 17:20Speaker 00

  And you're right to be successful, like cult doesn't have to be right, but the startup is a cult. That's right. And that's what makes a successful startup. So you have to decide very intentionally from scratch. What is your secret?

• 17:34Speaker 00

  In terms of the market, the product and your secret about people. Stitch them together into a set of beliefs. That's the cult. So the Trava cult is pretty unique. They did start with, we're doing things in person in nine nine six. Before it was cool. So this is they started the company in like, uh, baby, say June 21. Um, and at the time, lots of people said, oh, you can't do that. That's crazy. To me, it was like, duh, of course, every successful startup I've ever worked with. For the time I got involved in technology in 2000, how exactly that culture would actually, you're right. Nine nine six was lazy.

• 18:12Molly O'Shea?

  Yeah.

• 18:15Speaker 00

  I actually make this point to Mike all the time, like when I said PayPal, like nine nine six, that would have been like an easy week.

• 18:20Molly O'Shea?

  Totally.

• 18:20Speaker 00

  Actually, when I was a lawyer, nine nine six, I would have been like easiest thing ever. Like I'd build like 363 hours my last month as a lawyer.

• 18:28Molly O'Shea?

  What?

• 18:28Speaker 00

  Not worked. Um, so, yeah, so like. People want to be successful, have always been, you know, pretty dedicated. They have this attribute that. They've adopted of Olympian work ethic, which is also true. If you want to be. A successful Olympian, usually from the time you're somewhere between six and eight years old, depending on the sports, sometimes radio. You start training and you train constantly. And you have a shot, you know, of qualifying for the Olympics, winning a medal, winning an NCAA championship. Uh, so they, they've distilled it that way is you're working together with your team. Just like people who train to be successful in sports. That's a metaphor that they use, a conceptual framework that they use.

• 19:13Molly O'Shea?

  Hmm. Do you think culture has shifted since COVID?

• 19:18Speaker 00

  Well.

• 19:18Molly O'Shea?

  Like generally speaking?

• 19:19Speaker 00

  No, it shifted, uh, you know, in horrific directions and, um, but I think it's.

• 19:26Speaker 00

  Being brought back like in New York City, it truthfully, people were working in office in New York City very fast after COVID. Like at least when I've interviewed people or helped close candidates in New York over the last five years. Nobody even asked the question if you have an office or you expect people to be in the office. It actually just didn't even come up.

• 19:42Molly O'Shea?

  Yeah.

• 19:42Speaker 00

  It's just, well, of course you do, or Miami, same thing. In the Bay Area, it lagged for a long time. For a while, including, I'd say, almost until eighteen months ago. The only scaled modern company that I think was in office basically all the time was Rippling.

• 20:01Speaker 00

  I think now you're seeing startups. I know Merkhor is kind of, you know, very public about it. And there's a lot more people building, you know, at the foundational level that way. But if you look at how almost every successful company was built, it's like heroic effort. And then, once you stitch everything together and have a whole speech, I gave a lecture at Y C in two thousand and fourteen called How to Operate. Eventually, you want to stitch this stuff together. So it's a machine. But you need a heroic effort to construct the machine. And there's no substitute for that heroic effort in the beginning. And the beginning can be defined as the first five years, seven years, four years. Depends on how good you are stitching everything together and how fast you can build like this engine that just runs.

• 20:42Molly O'Shea?

  Yeah, I think in that interview, you mentioned a quote that build a machine so strong idiots can run it.

• 20:47Speaker 00

  Yeah, that's a Warren Buffett quote. But eventually, you know, we, we had a running joke in my PayPal days about we didn't think eBay was very well run and how much idiots. You know, as a management team, which has proven to be true, if you just look at the, the, the history of that company. But we had the running joke was we had an over under bet of if Martians invaded eBay. How long would it take before the world to notice? Because they had a network effect business that the, the worst executives in the world were screwing up. It's really hard to screw up a network effect business for usually at least a decade. But I remember sitting in a management meeting at eBay after we got acquired and right after we got acquired. And they hired some consulting firm, it's Bain actually, to analyze the threat posed by Google.

• 21:32Molly O'Shea?

  Oh.

• 21:33Speaker 00

  To commerce and their conclusion as a management team. And with the assistance of Bain was, well, there was no threat posed by Google. Well, these days, I haven't looked up Google's market cap, but I can tell you it's like at least fifty acts eBays. Well, because they had management consultants running around and they believe these idiots. Where I remember seeing in the audience of the Reid Hoffman and us like looking at each other during this presentation and saying, what the hell is wrong with these people? Like, they're gonna be toast in a matter of years, and they were toast. They were toast both on two directions, actually, Amazon and eBay both destroyed, I mean, both, uh, Amazon and Google destroyed them. And when we sold the company in two thousand and three, they were the leading ecommerce site, certainly in the last.

• 22:15Molly O'Shea?

  That's crazy.

• 22:16Speaker 00

  So don't hire Meg Wave in.

• 22:18Molly O'Shea?

  No.

• 22:21Molly O'Shea?

  Not, not that part. We'll, we'll leave that one out.

• 22:24Speaker 00

  You can leave it.

• 22:26Molly O'Shea?

  Oh, gosh. Okay, so, well, that reminds me, so there's a Cali market that aliens, do you think aliens will, will, uh, will say that aliens exist this year?

• 22:36Speaker 00

  That is a good question.

• 22:40Speaker 00

  Depends on that, I guess it depends on the definition of aliens. I don't spend too much time thinking about it, but, uh, I spend a little bit more time on the UFO stuff, a little less on.

• 22:47Molly O'Shea?

  What do you spend time on in UFOs?

• 22:50Speaker 00

  Watching all these documentaries, they're kind of cool and interesting.

• 22:52Molly O'Shea?

  Which ones?

• 22:53Speaker 00

  Oh, there's, there's a great one, actually, Netflix had this really good one. It's, it's actually pretty fascinating, I forget the title of it, you can add it.

• 23:00Molly O'Shea?

  Okay.

• 23:02Speaker 00

  It's pretty compelling.

• 23:04Molly O'Shea?

  Is it the one with the pyramids all over the place?

• 23:07Speaker 00

  That one, it talks about this, uh, UFO landing in Australia in nineteen sixty-three. That they're both, all the kids who are very young, like three years old, all remember the same exact things even thirty years later. There's some actually evidence on the ground, but anyway. I let other people like be the UFO junkies and they report back to me, it's kind of a fun dinner conversation.

• 23:29Molly O'Shea?

  It is a fun.

• 23:29Speaker 00

  I don't do conspiracy theories very much.

• 23:31Molly O'Shea?

  You don't?

• 23:32Speaker 00

  No.

• 23:32Molly O'Shea?

  No conspiracy theories?

• 23:34Speaker 00

  I'm not really, no.

• 23:36Molly O'Shea?

  You, you, okay, so, well, I'm gonna still ask you one.

• 23:39Speaker 00

  Okay.

• 23:39Molly O'Shea?

  Who do you think's running Elizabeth Holmes Twitter account? Sorry, X account.

• 23:44Speaker 00

  I don't know, but someone's pretty good, we should hire her. Maybe get them to do open door media.

• 23:49Molly O'Shea?

  You should, you should definitely get them to do open door media.

• 23:52Speaker 00

  We're gonna do authentic, uh, open door. Like, you may have noticed Shopify executives, uh, from Toby to Harley to Kaz, uh, actually authentically post on X consistently, and that's part of their culture. And so I think we'd like to embrace that, embrace retail as a movement. These are our customers, they're our crusade, and we should be transparent and use social media to communicate.

• 24:14Molly O'Shea?

  You are also very active on X.

• 24:16Speaker 00

  Yeah, I've heard of the product.

• 24:19Molly O'Shea?

  I, but I have noticed, like, since joining Coastal again, your contrarian takes have, I mean, I'm not gonna say they dulled down, but like you have gotten a little bit more mellow.

• 24:29Speaker 00

  Oh my God, I'm getting old, damn it. Um, yeah, well, I have a better answer, better thesis on this. My thesis is I ran out of contrarian takes because they've all been proven to be true. So like, for example, I used to, you know, argue, uh, that stretching is bad for you. And everybody thought I was insane. Like, this is probably the most controversial. And now there's evidence of why you shouldn't stretch. Second, like I remember, you know, Bloomberg wrote this profile of me in 2020, May 2020, where they described my theory on COVID as a, is escaping from a lab as a fringe theory. No quotes, no attribution to anybody, just dismissed it. Of course, that's true. Um, you know, I had like a bunch of contrarian theories about sleep, actually.

• 25:11Speaker 00

  So I grew up prioritizing sleep all my life. You can read interviews of me back in like 2010, probably, when I talked about this and how is the most important thing you could do to be happy, healthy, wealthy. Obviously, the evidence is incredible now. I don't think anybody would even debate that the best thing you could do for your life is to sleep properly and, you know, sleep more up to a certain amount. Um, and so I've been prioritizing sleep. Um, I used to, uh, let's see. Well, I still believe that ketchup's really good for you when you're a kid.

• 25:41Molly O'Shea?

  Ketchup?

• 25:42Speaker 00

  Yeah, people who are successfully eating a lot of ketchup when they're young. That one still gets a little bit of a shock.

• 25:48Molly O'Shea?

  That's so weird.

• 25:49Speaker 00

  I haven't quite convinced everybody that yet, but if you do, uh, there's a book that Tyler Cowen and Daniel Rose wrote. It talks about stellar people and their backgrounds. And they get close to that theory. Uh, they argue it with a sort of different like food, but it's similar. Malcolm Godwell also has a chapter on how ketchup is the perfect, uh, food.

• 26:10Molly O'Shea?

  Why?

• 26:12Speaker 00

  I've just noticed observationally that

• 26:14Molly O'Shea?

  Sugary tomatoes.

• 26:15Speaker 00

  Friends, I'm like, how much ketchup did you have when you were a kid?

• 26:17Molly O'Shea?

  Really?

• 26:17Speaker 00

  Yeah.

• 26:18Molly O'Shea?

  What is your view on the Diet Coke theory?

• 26:21Speaker 00

  Well, Sue, I've studied this one. I used to be a Diet Coke addict. And when I mean addict, I'd have between eight and 10 every single day all my life, like lawyer, entrepreneur. And then, and I read all the studies, people would say, oh, it's can't, you know, carcinogenic and all this stuff. That is not true. I read every single study that everybody would critique me and they show me some research and I'll read it. But then I got convinced of one. There's a really well done study about eight years ago. That I took people with similar diets, similar body composition. And allow similar calorie sort of intake per day. Allowed some one cell of the experiment to drink Diet Coke.

• 27:02Speaker 00

  And what they showed in the study is that your body still produces insulin resistance. As if it was sugary.

• 27:09Molly O'Shea?

  Really?

• 27:09Speaker 00

  So you don't have the calories, but your body thinks it's insulin because of some combination of the ingredients and taste. And so if you spend all your life doing high intensity training and all these other things I knew to avoid insulin resistance, it was kind of silly to be drinking Diet Coke is inconsistent with the goals. So I just stopped cold turkey. Literally, I read the study, stopped cold turkey next day, have not had a Diet Coke in eight years.

• 27:31Molly O'Shea?

  Wow.

• 27:31Speaker 00

  Literally not a single one. I used to have eight to 10 a day. Like you ask anybody.

• 27:34Molly O'Shea?

  No water.

• 27:35Speaker 00

  Sometimes like I run into people and they're just like ready to, they haven't seen a while and they like hand me a Diet Coke because I was so addicted to it. Now I have like green tea.

• 27:44Molly O'Shea?

  Which kind?

• 27:44Speaker 00

  Uh, I used any kind, any kind, green tea iced.

• 27:46Molly O'Shea?

  Big matcha guy?

• 27:47Speaker 00

  And then I do have Celsius.

• 27:49Molly O'Shea?

  No.

• 27:50Speaker 00

  Yeah.

• 27:50Molly O'Shea?

  Keith, that is like worse than Diet Coke.

• 27:52Speaker 00

  Depends who you ask.

• 27:53Molly O'Shea?

  Is it because you go to berries and it's there?

• 27:56Speaker 00

  Celsius is, you know, like spiking your body a bit with caffeine.

• 27:59Molly O'Shea?

  Doesn't it have like heroin in it?

• 28:02Speaker 00

  It's a proprietary formula. Nobody knows. Look at the can. It's like a proprietary formula. And the only thing they disclose that you that has one of the active ingredients in green tea.

• 28:11Molly O'Shea?

  Oh, my gosh.

• 28:11Speaker 00

  ESG or something.

• 28:13Molly O'Shea?

  Geez, have you tried?

• 28:14Speaker 00

  Ten billion dollar company.

• 28:15Molly O'Shea?

  It's a big company.

• 28:16Speaker 00

  Yeah. So maybe, maybe, you know, maybe entrepreneurs should be innovating in that space, too.

• 28:20Molly O'Shea?

  They should. Have you tried peptides?

• 28:23Speaker 00

  No.

• 28:23Molly O'Shea?

  No peptides?

• 28:24Speaker 00

  I have not tried any. I do have friends who are experimenting with them. They seem actually pretty interesting, intrigued with the results they're getting. I'll probably run through a more rigorous, like.

• 28:37Speaker 00

  Healthcare driven assessment with like one of my fancy doctors.

• 28:41Molly O'Shea?

  Okay.

• 28:42Speaker 00

  But no, I've never tried any.

• 28:44Molly O'Shea?

  There is one thing that we need to address about berries. I read this online. You have publicly denied it, but there are rumors that you were doing pushups on your knees.

• 28:54Speaker 00

  Oh, no, that's like absolutely absurd. The only possible scenario that would occur is if it was like my third class of the day. And like I, once in a while, do you take three classes a day? But impossible.

• 29:05Molly O'Shea?

  Impossible.

• 29:06Speaker 00

  Impossible.

• 29:07Molly O'Shea?

  No way.

• 29:08Speaker 00

  No.

• 29:08Molly O'Shea?

  Okay.

• 29:09Speaker 00

  Army class, though, if you ever tried an army class in New York. Sometimes instructors like three minutes of pushups consecutively. And he gets really mad if you stop. So most of the guys eventually give out. But like, that's pretty, the berries, it's impossible.

• 29:24Molly O'Shea?

  How do you have so much energy?

• 29:26Speaker 00

  That's a good question. I think it's actually something you can teach yourself. Like it's an acquired taste. I think many things in life are that way. They're path dependent. You just decide to have energy. And then if you have sleep, like the truth is, sleep is very effective. I do like things like cold plunges or cryotherapy. I believe in those.

• 29:45Molly O'Shea?

  Yeah.

• 29:46Speaker 00

  I've got a little bit into this red light therapy, therapy stuff and reading about it. I can't really tell whether it's making a difference for me or not, but I've read the research and it seems pretty compelling with no downside. I said you stuff like that, but it's mostly, I think, just sleep. Adrenaline and sleep.

• 30:01Molly O'Shea?

  Adrenaline and sleep. It's good. It's great. It's a good combo.

• 30:05Speaker 00

  Yeah. As long as you recover. And I measure, you know, I wear this and have all these measurements on the recovery. But I basically don't believe in days off for anything, work.

• 30:16Molly O'Shea?

  Yeah, I was, I was listening. So in the Harry Sevings podcast, you were talking about, okay, so even if you're not working, you're watching the highlight reels or you're watching back the.

• 30:25Speaker 00

  Yeah, if you're an athlete, like it's not like you train. Most athletes probably train six days a week. But the day they're not training, they're probably watching like film, like in football, they're certainly watching film. And so I think you can combine what you do, just so like when I was running, last really running a company like at Square. Sundays would be workdays, but I would be on a non, non calendar scheduled sort of sky, approach, which would be I go in the office.

• 30:52Speaker 00

  I'd sit at a high desk with an iPad and with a huge red notebook and just draw my ideas. And people could come up and interrupt me, but I wouldn't put things on the calendar. So my brain would be at a different tempo and it allowed me to kind of brainstorm. That's why I had this huge red notebook that allowed me space, almost like a mini whiteboard. And then I would be available for people who wanted to debate things, ask questions. And so it was a very different kind of day. And I think that can be effective, like rotating how you do your work is useful, just like training. Like the problem with doing berries all the time is we do rotate body parts per day.

• 31:35Speaker 00

  However, the programming is pretty similar. So I think cross-training is very good for your body. So I do like to lift and I like this army program. Unfortunately, it's only in New York. But like, I think changing what you do once in a while is very effective. I like hiking too, if I'm like traveling.

• 31:53Molly O'Shea?

  Performance is a big part of building companies and investing in companies. There's a company you've probably heard a lot about. It's really popular. We're sponsored by Brex. It's this amazing company. They're all about spending smarter, moving faster, intelligent finance. You're well aware of this. You love intelligent finance. Who is someone that you've learned a lot from and what was the biggest lesson?

• 32:17Speaker 00

  Oh, I learned a lot from people constantly. Like I've actually given a whole presentation, a whole podcast, a whole speech on like lessons I've learned from Vinod, Peter Thiel, Reid Hoffman, Max Levchin. But I try to absorb from everybody, like founder, the benefit of working with a lot of talented founders is I've learned things from Christian at Trade Republic. I've learned things from Eric and Kareem at Ramp. I've learned things from Mike Attraaba constantly. The best, it really is like maybe the best part of the job. One of the two best parts of being a VC is you get to work with the most talented entrepreneurs in the world and you get to watch them. And you learn things and then you apply, try to apply them. The same, the other benefit is if you're intellectually curious.

• 33:01Speaker 00

  And this is why Delian became a VC, actually, is he's very intellectually curious. It's the only job where you get paid for learning new things. So every hour, every day is different. And I sit in a partner meeting and my colleagues at KV bring in these very weird, unusual companies that are the cutting edge of technology. And I learn, I sit there and learn by osmosis. And over the years, I've learned a fair amount about AI. I've learned a lot about batteries, things I never would have been capable of learning on my own. And so I really don't believe there's a better job for someone who's intellectually curious. I was intellectually curious from the time I was four years old. My mom loves to tell the story that we used to have the world book encyclopedia and I read every single volume, cover to cover.

• 33:44Molly O'Shea?

  Really?

• 33:44Speaker 00

  Mm hmm. That was my hobby, other than soccer or baseball.

• 33:48Molly O'Shea?

  Encyclopedias?

• 33:49Speaker 00

  Yeah, from scratch.

• 33:50Molly O'Shea?

  Oh, my God.

• 33:51Speaker 00

  So like VC is like, that's what venture capital is, is like reading an encyclopedia.

• 33:56Molly O'Shea?

  Can you recount everything you've learned from the encyclopedia?

• 33:58Speaker 00

  No, actually I can't. I'm better, actually, interestingly enough, my sort of oral memory is much better.

• 34:05Molly O'Shea?

  Really?

• 34:06Speaker 00

  So I can recount almost every conversation I've had with somebody.

• 34:09Molly O'Shea?

  Wow.

• 34:09Speaker 00

  Which turned out to be, is actually pretty useful. It's very useful as a lawyer. It's extremely useful, actually, as a VC in terms of board meetings. Like, so I typically run hot, meaning I run on a lot of boards. I serve on a lot of boards simultaneously. And sometimes I get asked, like, how do you do that? Like, how do you keep up and understand what's going on? And I've been fortunate enough to have a very strong memory. So I can remember numbers, metrics, presentations from years ago. And, you know, jump into the middle of a conversation and often remember better than the founder.

• 34:47Molly O'Shea?

  So do you listen to a lot of podcasts and audiobooks?

• 34:50Speaker 00

  Well, I don't listen to too many podcasts. I do listen to 20 Minute VC.

• 34:54Molly O'Shea?

  Good.

• 34:54Speaker 00

  I've listened to Jack Altman's new series on tap. I found it to be quite, quite.

• 35:01Speaker 00

  Inter intellectually interesting, actually. But generally speaking, other than those two.

• 35:07Molly O'Shea?

  You also listen to Sorcery.

• 35:08Speaker 00

  Podcasts on an episodic basis. So like, you know, once in a while I'll see a humor in episode and I'll be like, oh, that topic's cool. Like sleep or something and or cold, cold plunge, cold theory, cold deliberately. He calls it deliberate exposure to cold or something. So once in a while I'll see a topic and I'll be like, that's cool. I'd rather read. So I like to read books, like real books, like old school printed books. That's how I learn.

• 35:30Molly O'Shea?

  What's your favorite book?

• 35:31Speaker 00

  Favorite book is called The Upside of Stress.

• 35:32Molly O'Shea?

  Okay.

• 35:33Speaker 00

  Uh, and it's written by a professor at Stanford named Kelly McDougal.

• 35:38Speaker 00

  And it really crystallized. So talking about conventional, uh, contrarian ideas. I used to believe stress is good for you. Like, I used to proselytize this everywhere to everybody I've ever met. For the time I was like in junior high school, to forever. And everybody thought, not everybody, but most people thought it was crazy. Like, you're like, stress is bad for you. It makes you, you know, sick and all this blah, blah, blah, blah, blah, blah. And then she wrote this book and I discovered this book. And chapter by chapter, she argues in every possible way, in an unequivocal fashion, that the more stress you have in your life and the more you embrace it, you're going to be not only healthier, more successful, but you're going to be happier too. And so I give people this book all the time. It's the best.

• 36:18Molly O'Shea?

  We'll link it.

• 36:19Speaker 00

  Yeah, we'll link, link it to it and it'll change. It changes people's life. I literally have had people come up to me after reading it and say, you just changed my life.

• 36:26Molly O'Shea?

  Wow.

• 36:26Speaker 00

  So that's my favorite, that lot. High Output Management by Andy Grove is the business favorite. I, I, for the first 18 years I was in technology, I reread it every single year and always found in my highlights, learning new things.

• 36:44Molly O'Shea?

  Wow. It's pretty insightful.

• 36:46Speaker 00

  So those are the two to start with.

• 36:47Molly O'Shea?

  Those are good. Those are good starters.

• 36:49Speaker 00

  Uh, Score Takes Care of Itself, Bill Walsh. Uh, The Lesson of How to Build, barring from football, How to Build a Company Successfully. Those are the three like canonical books for me.

• 37:01Molly O'Shea?

  That's a good starting list. Those are great. So we are just out of time, but I have like one

• 37:07Speaker 00

  Yeah.

• 37:07Molly O'Shea?

  question I've been dying to ask you. Have you ever swam in your fish tank?

• 37:12Speaker 00

  No. You can't actually, you'd kill all the fish.

• 37:16Molly O'Shea?

  What's in there?

• 37:17Speaker 00

  Well, there's exotic fish, but it's not, it's not, it's saltwater. So if they got exposed to like a foreign body, they'd all die. So when, when, when the fish tank does get cleaned, like a person has to wear like a wet suit. You can't, you can't just jump in. A Instagram influencer asked me once, if one of the top like three Instagram or TikTok Instagram influencer types, asked me if he could, it's like, oh my God.

• 37:45Molly O'Shea?

  Do you have a shark in there? What's in there?

• 37:46Speaker 00

  I don't have a shark. No, there's, I don't think the fish would eat you or sting you, but it's just, they would die.

• 37:52Molly O'Shea?

  Yeah, that's not good. We don't.

• 37:53Speaker 00

  No, they're very fragile.

• 37:55Molly O'Shea?

  Yeah. Kyle, well, Keith, it was a pleasure to have you.

• 37:58Speaker 00

  Pleasure to be with you.

• 37:59Molly O'Shea?

  Hey, it's Molly. If you enjoy our interviews, check out our newsletter sorcery dot V C, where we deliver a once a week top deals and tech headlines email and also go deeper on our podcast interviews. Subscribe to sorcery today and don't forget to subscribe to the podcast on YouTube, Spotify, Apple, or wherever you listen. Link in description to sign up.