EP 144: Jeffrey Katzenberg & Sujay Jaswa (WndrCo) on What Startup Founders Can Steal From Hollywood

Logan sits down with Jeffrey Katzenberg, Hollywood legend and co-founder of DreamWorks, and Sujay Jaswa, former CFO of Dropbox - together, the duo behind WndrCo. They talk about building enduring companies, bridging tech and media, and what makes a great CEO partnership. The conversation also touches on storytelling as a business superpower and lessons from scaling at different stages. Whether you're a founder or a media nerd, there’s something here for you. (00:00) Intro (04:26) The Genesis of the Partnership (13:06) Building and Investing in Companies (20:27) The Team and Their Roles (26:52) Decision-Making Process (33:25) Balancing Dreams and Skepticism (35:06) The Dynamics of Partnerships (37:25) Transitioning to Tech (38:45) Cultural Differences in Industries (41:26) The Value of Failure and Success (44:37) Excitement in Emerging Technologies (48:23) The Venture Capital Game (56:42) The Dropbox Talent Network (01:01:20) AI's Impact on Media and Creativity (01:06:18) Transitioning to CG Animation at DreamWorks (01:08:39) Embracing Change in the Intelligence Revolution (01:11:52) The Role of AI in Enhancing Productivity (01:14:11) Building a Consumer Cybersecurity Business (01:23:49) The Mission to Protect Children Online (01:35:17) Reflections on Partnership and Innovation Executive Producer: Rashad Assir Producer: Leah Clapper Mixing and editing: Justin Hrabovsky Check out Unsupervised Learning, Redpoint's AI Podcast: https://www.youtube.com/@UCUl-s_Vp-Kkk_XVyDylNwLA 🎙 Listen to the show Apple Podcasts: https://podcasts.apple.com/us/podcast/the-logan-bartlett-show/id1606770839 Spotify: https://open.spotify.com/show/5WqBqDb4br3LlyVrdqOYYb?si=3076e6c1b5c94d63&nd=1 🎥 Subscribe on YouTube: https://www.youtube.com/channel/UCugS0jD5IAdoqzjaNYzns7w?sub_confirmation=1 Follow on Socials 📸 Instagram - https://www.instagram.com/theloganbartlettshow 🐦 Twitter - https://twitter.com/loganbartshow 🎬 Clips on TikTok - https://www.tiktok.com/@theloganbartlettshow About the Show Logan Bartlett is a Software Investor at Redpoint Ventures - a Silicon Valley-based VC with $6B AUM and investments in Snowflake, DraftKings, Twilio, and Netflix. In each episode, Logan goes behind the scenes with world-class entrepreneurs and investors. If you're interested in the real inside baseball of tech, entrepreneurship, and start-up investing, tune in every Friday for new episodes.

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

• 0:00Speaker 00

  A day in the life of SuJai is, I love this idea. It's the greatest thing I've ever heard. This is a stupid idea. We should not be doing this.

• 0:06Logan Bartlett?

  Are those the same idea?

• 0:08Speaker 00

  Oh, yeah. Multiple times a day.

• 0:09Logan Bartlett?

  You're like, SuJai, lie horizontal on the couch.

• 0:11Speaker 02

  You talk to my wife or any of those people at Dropbox who work for me. You know, describe as schizophrenia.

• 0:17Logan Bartlett?

  We can laugh about it.

• 0:23Logan Bartlett?

  All right, guys. Thanks for doing this.

• 0:24Speaker 02

  Great to be here.

• 0:25Logan Bartlett?

  So for people not familiar, can you give a little bit of overview on what you guys do? And how the partnership came together?

• 0:32Speaker 02

  Well, how the partnership came together is kind of a fun story. If you want to.

• 0:34Logan Bartlett?

  Yeah, let's do it.

• 0:35Speaker 02

  If you want to talk about that.

• 0:35Logan Bartlett?

  We've got time.

• 0:36Speaker 02

  But.

• 0:36Logan Bartlett?

  At least I do. I don't know if you guys do, but we have some time to do it.

• 0:39Speaker 02

  Yeah, we have a bit of time. He sleeps four hours a night.

• 0:42Logan Bartlett?

  Is that right?

• 0:42Speaker 02

  Like, literally.

• 0:44Logan Bartlett?

  Jeez. Is that like a genetic thing?

• 0:45Speaker 00

  He exaggerates. It's five.

• 0:47Logan Bartlett?

  Wait, is that?

• 0:48Speaker 00

  It's genetic, literally, since I was 15 years old.

• 0:50Logan Bartlett?

  Have you ever done like an Oura ring or one of those things to try to figure out? Do you get like a disproportionate deep sleep or something? Or it's just never?

• 0:56Speaker 00

  I've been doing this for 68 years. I don't need to.

• 0:59Logan Bartlett?

  You don't need to be analytical about it.

• 1:00Speaker 00

  Yeah. It just works.

• 1:01Logan Bartlett?

  I'm more fascinated by the sleep process, though, of like the people that can do it. Because I can't do it. I can do like six and a half, seven. But the people that can operate on that, I just don't know like what they do differently.

• 1:11Speaker 02

  Let me rephrase it. Because I have to travel with this guy all over the world for now almost a decade. He'll sleep his four or five hours. He'll go to the gym for two and a half hours. Then I'll meet him for breakfast. And then we like literally roll meetings or phone calls or like micro meetings that he sets up until like 10:00 PM. And this is five hours after we landed. And then you just do that in like four countries and then you go home.

• 1:40Logan Bartlett?

  And you've always been that way?

• 1:41Speaker 00

  Always. It's a blessing.

• 1:43Logan Bartlett?

  It's fascinating, for sure.

• 1:44Speaker 00

  You know, it's like the Beatles wrote a song for me. It's called Eight Days a Week.

• 1:47Logan Bartlett?

  Yeah, right? I mean, listen, you've got far more hours than I do.

• 1:51Speaker 00

  It is a competitive advantage.

• 1:53Logan Bartlett?

  Totally.

• 1:53Speaker 00

  Here's another one. And so, so, yes, I sleep five hours and 15 minutes, kind of no matter what. I can't sleep six or seven hours. It just doesn't, I wake up staring at the ceiling.

• 2:04Logan Bartlett?

  That's crazy.

• 2:04Speaker 00

  You know? I don't get jet lag. He'll tell you that's the other thing. It's just no matter where I fly, how long, where, in what time zones I'm going through in it. There's like a thing, you know, on your, on the old fashioned watch where you could turn the time.

• 2:17Logan Bartlett?

  Yeah, adjust it.

• 2:18Speaker 00

  Adjust the watch in it. Somehow or another, I turn my brain to like where we're landing. And I'm on now on that zone, time zone. And when I land there, that's it.

• 2:27Logan Bartlett?

  Do you guys keep up, football fans, do you guys follow?

• 2:30Speaker 00

  A little bit.

• 2:31Logan Bartlett?

  So Adrian Peterson like tore his ACL and came back like three months later, whatever, and was playing. Like, I feel like that's what I'm hearing right now. There's some people are just like genetically built differently.

• 2:39Speaker 00

  But here's the other side of it though, which is unfortunate, which is I have fairly extreme.

• 2:49Speaker 00

  Dyslexia and it has very, you know, there, there are certain aspects of it that are really, you know, they're real liabilities and they're hard that you have to work to overcome. I have over the years, but you know, with the good comes the.

• 3:04Logan Bartlett?

  Yeah, sure. Was that diagnosed when you were young or something you figured out later?

• 3:07Speaker 00

  Forty years old before I understood, anybody understood what it was. And, and so, you know, I invert words. I can't read off a teleprompter. I can't put names and faces together. Like literally, I could run into you tomorrow in a hotel in San Francisco and I will, we will spend two hours together here. And I will, I'll recognize you, but literally, you know, it's like a switchboard. I can't find the plug to.

• 3:35Logan Bartlett?

  That's fascinating. Are there creative manifestations of it that you, like you think that elements of creativity? Cause it's something you hear dyslexia can, can lead to more, hard to say.

• 3:45Speaker 00

  I have no idea, you know, and again, I've asked the question a million times, you know, how do you know what a good idea is, you know, which is what I've spent a lifetime, you know, trying to truffle hunt, find good ideas and somehow or another, more, more often than not, you know, I can, I can, I know when an idea is a good idea. And I don't know where it comes from. I have, again, you know, have, it's a, it's a unique thing to be able to.

• 4:11Logan Bartlett?

  Yeah, intuition.

• 4:12Speaker 00

  To be able to listen and to be able to see and to recognize when something is unique and special and could be great as a story or. You know, what we do together in venture, it's, it's, you know, isn't that sort of like the heart and soul of what we do? Which is just find that rare person with those attributes of, you know, persistence and vision and ambition and perseverance. And we could go through all of those things that you would say are fundamental to a great founder. It's also fundamental to a great storyteller.

• 4:48Logan Bartlett?

  Yeah, that's interesting. So, so how did the partnership come to be?

• 4:52Speaker 02

  So, let's see here. So, 2015, I leave Dropbox, figure, you know, we just had a really good run. I think fastest run at that point in the history of software.

• 5:02Logan Bartlett?

  An amazing density of talent, by the way.

• 5:04Speaker 02

  We can talk about that too.

• 5:04Logan Bartlett?

  Yeah, that'd be interesting.

• 5:06Speaker 02

  And that's, that's one of the best parts of the company. But I think we had gone from a cold start to, when I left, 600 million of ARR in four and a half years? Five and a half years. And coming off of that, I thought I would just go back to venture capital. I'd come, I joined Dropbox from NEA. And in the process of talking to many of, you know, the good firms, I just realized my heart wasn't into it. Like, I wasn't excited about it. I like the building. And I felt a little bit lost because Drew invented a product that at that point, 400 or 500 million people were using. I was never going to invent a product that I didn't think that 400 or 500 million people were going to ever use.

• 5:50Speaker 02

  And so I was sort of in the wilderness, kind of figuring it out. And a friend of mine in New York, who started Spruce Point Capital, he's Spruce House Capital. He's like one of the all-time great guys and actually fantastic, interesting investor. Gave me this book, The Outsiders.

• 6:08Logan Bartlett?

  Yeah.

• 6:08Speaker 02

  So I never, I never come across this, 2015. And I was like, oh, wow, I can't do what Drew did, which is come up with a product that hundreds of millions of people want to use. But there is a whole, there's like this whole thing in building businesses where it turns out that if you look at the history of tech, many of the great businesses didn't start the way we all storytell them, right? IBM started as a private equity rollup. And I remember I'm a student of tech history.

• 6:35Speaker 00

  Yeah, yeah.

• 6:35Speaker 02

  And so I started remembering that book, which I had read, you know, in The Maverick and His Machine, which I had read like in business school or something like that. And I was like, oh, wow, maybe I can do that. And so I started looking for companies to buy. Samir Gandhi at Excel and Joe Lonsdale and I were going to partner up to buy a company. And we're going to go pursue this outsider strategy. And out of nowhere, I get a phone call from Diego Burdacken. I don't know if you've come across Diego. So Diego is the founder of Cloud Kitchens, which Travis is now the CEO of. And Diego is one of my best friends. Diego calls me and said, listen, I just played poker with Jeffrey Katzenberg. He just sold DreamWorks to Comcast. He wants to start a holding company. You know, he saw what Barry Diller had done with Ice. He wanted to start a holding company. I told him that, you know, you've kind of figured out like some of the mechanics of it.

• 7:18Speaker 02

  Would you be willing to just talk to him and tell him like kind of what you're setting up? And I did. And, and so we had a great phone call. Of course, I wanted to talk to Jeffrey Katzenberg. And Jeffrey and I talked. And he's like, hey, are you ever in Malibu? And I said, actually, I'm there most weekends right now because a handful of us used to share a beach house in Malibu at that time. And so we had lunch the next Saturday or Sunday. And Jeffrey said, why don't we just do this together? And I was like, why? I mean, obviously, you know, you're like, you know, whatever, world famous person, but like, and that's, that's cool. But like, like, I'm like a Silicon Valley software guy. You're a Hollywood guy. And over the next two months, we talked every day.

• 8:01Speaker 02

  And in August, you know, we said, let's, let's do this thing.

• 8:05Speaker 00

  And what was the vision? So I'll give you my side of that, which is, so when I was 22 years old, I was here in New York City. I had worked for John Lindsay literally since I was a teenager. It's just an amazing ride and sort of saw the world. That was my, that was my college education was the streets of New York. And he ran for president in 1972, failed. Everybody went back to City Hall and I wanted to go find a career. And I remember at the time, actually consciously having this thought of like, I had been exposed to all these amazing things, working for Lindsay and as I was a like advanced body guy. And so I got to see everything.

• 8:49Speaker 00

  And I thought, I want fortune and fame. And in 1973, too, you want Fortune 88, you go to Hollywood. And in fact, that's what I did. So skip forward. So then through the, there's a connection here in this. Through every chapter of my storytelling career, you can actually go and see that one of the foundational elements of certainly what I think was my success is how aggressive I was in finding state of the art tech for my storytellers. Wherever I was, whatever studio I was at, whatever era I was in,

• 9:31Speaker 00

  I always looked to one of the best tools to be able to realize the most exciting and interesting stories. I always love the story, you know, when Steven Spielberg first made Jaws, he cut a piece of plywood out in the shape of a shark fin, painted it gray and dragged it behind a motorboat. That was a special effect. So now think of generationally, all of these things that happened with optical effects and digital effects and then CG animation transformed, completely transformed the animation industry and digital distribution and digital projection. And I could go on and on in this and then, and so I was constantly having these pilgrimages to Northern California, to the tech world,

• 10:13Speaker 00

  where I partnered with Hewlett Packard and Andy Grovet Intel and Steve Jobs on Pixar. And I, you know, on and on in this and then, and so having, you know, we, DreamWorks Animation had a studio in Ridwood City with 800 artists there. It's actually where the first Shrek movie was made. So back at this, I'm now sell DreamWorks in like literally nine years within a week, I think. And I actually recall that same thought, like, okay, well, if you were 23 years old today, and I was 65 or six or whatever, what would you do? And I went, I'd go to Silicon Valley. That's where Fortune and Fame is today.

• 10:56Speaker 00

  I also recognize that I know what I know, I know what I don't know. And if you asked me to say, is there a recurring theme or ingredient in the success of different chapters I've had over my career? I would say yes, I would start with fundamentally. At every one of these chapters, I have had either an amazing mentor or an amazing partner. And that that's like foundational to everything great that has happened to me. So I can go back into politics, I won't, but you know, David Picker, Barry Diller, Michael Eisner, David Geffen, Steven Spielberg, Sujay Jaswa.

• 11:39Speaker 00

  And I interviewed in this, before I got introduced, before Diego and one other person put the two of us together, I had met 300 people over a series of months trying to find that partner, that person who knows more than me, knows everything I don't know. And I believe that at that time, I had found that in Sujay. And nine years later, I can tell you, I am certain that I found that in him and to his embarrassment in this, which is, I do believe that when people someday look back and look

• 12:20Speaker 00

  at which, you know, which chapters of my career, or which acts of my career, you know, what successes did I have? The best ones and the most successful ones, the most important and impactful act is going to be the one I'm in right now with him, literally. We will do more good for the world, we will have success, depending on what, whether it's fortune or fame, however you want to measure it, in it that I think will outdo everything that I've done to date. And I'm saying with, you know, I hope a bit of humility, that humbleness, that I understand Lion King, and Trek, and Kung Fu Panda, and Dragons, and all of these things, and Beauty

• 13:04Speaker 00

  and the Beast, and you know, all of those. As proud as I might be of those, I think the best is in front of me. Literally, and that this partnership is is why.

• 13:18Logan Bartlett?

  And so you guys are nine years in?

• 13:20Speaker 00

  Yeah, yeah.

• 13:20Logan Bartlett?

  And and so how has it evolved? Like, what's the what was the original vision? And maybe give us a snapshot to where it is today?

• 13:28Speaker 02

  Yes, where where we started was this idea that we'll create one or two companies here. And so in the we I think we've created 10 or 11, eight in tech, two or three in digital media. Digital media has been a challenging field. We can talk about that. But the eight in tech. I mean, a couple of them are recent, but this year, I think we'll do about one, close to 1.1 billion of revenue and 200 million of EBITDA. And, you know, we own at this point, after some dilution, between 28 and 80%.

• 13:58Logan Bartlett?

  And all those pure incubation, not?

• 14:00Speaker 02

  Incubations, but we'll we'll do like acquisitions of products.

• 14:03Logan Bartlett?

  Got it.

• 14:04Speaker 00

  Did a take private on one?

• 14:06Speaker 02

  Did a take private of one business that was in a challenging situation and did a whole bunch of crazy stuff with it.

• 14:12Speaker 02

  Yeah, so it's it's it's become like a pretty interesting portfolio. I mean, I think if you were to aggregate how much capital we've put in for that ownership position in those businesses, I think we've put maybe $300 million.

• 14:22Logan Bartlett?

  Oh, wow.

• 14:22Speaker 02

  So, yeah, so it's it's looking pretty good at the moment.

• 14:25Logan Bartlett?

  And and who do you guys emulate? Like, if we were to say?

• 14:28Speaker 00

  Well, I think you'd have to go back and look at the founders fun and

• 14:32Logan Bartlett?

  Yeah, got it.

• 14:32Speaker 00

  Peter Thiel and those guys, they they did this in their own way years ago.

• 14:36Logan Bartlett?

  Sure.

• 14:36Speaker 00

  They built companies and they also invested

• 14:39Logan Bartlett?

  Yep.

• 14:40Speaker 00

  in companies. And because we've both been in the field of creating and building, and that has a great fun and satisfaction for us, but also finding other great founders and and and betting on them is also equally interesting to us. And so

• 14:58Speaker 00

  We are this sort of unique blend of those two things and they're very complementary. Yes.

• 15:04Speaker 02

  We added that later.

• 15:05Speaker 00

  Yeah.

• 15:06Speaker 02

  So, so the way we got into venture, because we originally weren't planning to venture.

• 15:09Speaker 00

  We were a holding company when we started.

• 15:11Logan Bartlett?

  I thought you were gonna say Diller, right?

• 15:13Speaker 02

  Well, it's like, it's like, if you think about it, it's like, who did we study and admire? It's, you know, obviously IAC, LVMH. Buffett less so, because we're really hands, you know, we're super operationally involved. Um, I mean, obviously he's the GOAT, but.

• 15:27Speaker 00

  Sure.

• 15:27Speaker 02

  But in terms of, you know, Constellation, although they're less operationally involved, but we admired how they kind of figured out value creation.

• 15:33Logan Bartlett?

  Best practices and all that stuff.

• 15:35Speaker 02

  Exactly, but, you know, it's, it's like, we really studied the hands-on holding companies for that side of it. Um, the big difference that we brought kind of a, maybe a more venture lens, it's hard to know from the outside of these things, is we really partner with someone that is like the founder, CEO on each of these things.

• 15:50Logan Bartlett?

  Yeah.

• 15:50Speaker 02

  So we're kind of like founder chairman sort of thing, and they're the founder, CEO, and we're, we're like, you know, behind them and partner, I mean, talk every day kind of thing, but it's not, um, there have been periods where we've been like directly running the businesses, but we try to, to scale, you have to get people, work with people who are amazing.

• 16:09Speaker 00

  And I would say the way we try to frame it, particularly for the ones that we are doing more venture investing in, is say to them, treat us as an extension of your C-suite. How can we help you? I know everybody says that all the time in this, there isn't a venture that doesn't say that. Um, we try and do things that I think, uh, are unique to us, either by the relationships that we have, the access that we have. In my case, we talk about this all the time, storytelling is literally fundamental to every business. There is not a business that exists that you, that there isn't storytelling at the foundation and the core of it. So whether it is the moment in time in which a founder has an idea, he needs to be able to explain that idea, or she, to

• 16:55Speaker 00

  other people that they want to come work with them. They have to be able to explain that idea to go out and raise capital. You have to have that idea in order to find your, go to market, to find your sales, to talk to your consumer. Storytelling is literally at the core of business building.

• 17:12Speaker 02

  Mm-hmm.

• 17:13Speaker 00

  And that's the one place. Where those 45 years of experience actually have direct application to doing this. And so, sitting with a founder and actually going through their sales deck with them and helping them frame it, perfect it, and get it into, you know, that just rock solid, you're going to tell your story in 18 minutes on a Zoom and be able to answer questions and be done at 29 minutes. You know, it's an art and a science. And so, there are lots of people that can give you the science of how to put a great storytelling, you know, sales deck together. The art side of it, you know, it's a nuance.

• 17:54Logan Bartlett?

  And what percentage of, I guess, the investments, like of that 300 million capital in of those first, like, how many of them wouldn't exist otherwise? Either because the IP or the, it was a pure incubation?

• 18:06Speaker 00

  None.

• 18:07Logan Bartlett?

  Yeah, so that's 300 million and then the balance of dollars deployed.

• 18:11Speaker 02

  Yeah, so basically, the way, the way to think about it is inside of the holding company, it ended up, it's probably 60% on the, the build side and 40% on venture and venture adjacent things.

• 18:23Logan Bartlett?

  Yep.

• 18:24Speaker 02

  And then, we raised a regular, traditional GPLP fund, uh, two or three years ago, and that's more 55 venture, 45 builds.

• 18:34Logan Bartlett?

  Got it.

• 18:35Speaker 02

  And I think that's, you know, again, I think in a traditional GPLP fund, you've got to have a little more diversification. I think in a holding company, you can be pretty concentrated, take big swings, you know, you get a lot of white hair from that process. But it also means you're, you know, you're committed to making these things work.

• 18:48Logan Bartlett?

  Sure.

• 18:49Speaker 02

  Come hell or high water.

• 18:50Logan Bartlett?

  It's, uh, how much time is spent, like, I realize that's, it changes by the day.

• 18:55Speaker 02

  So we just don't do that many deals. So that, that's our biggest constraint. So time is, you, so here's actually the crazy thing. So Jeffrey describes storytelling on sales decks and stuff. He will then sit down and do hundreds of sales calls with these founders. Like, I've

• 19:10Speaker 02

  I actually really would love to understand at some point why you do that. Like, I've never quite figured out what motivates someone who created it.

• 19:18Speaker 00

  So I have a bottomless need to sell.

• 19:20Speaker 02

  Yeah.

• 19:20Speaker 00

  So, give me something that I believe in. Let me loose.

• 19:24Speaker 02

  Yeah.

• 19:25Speaker 00

  You know, and so, yeah, we find these. You know, for me, if I understand the application and why a product is going to make a company more successful, save them money, give them a better trajectory on this, that I know I'm doing something that's gonna help. I am a bulldog, right? Like, I just, I will drive through any wall to get them to actually try the product. And, and allow that, and allow them to see it for themselves. And I, so, we don't do it with that many, but when we do, you know, I'll literally do 100 sales calls.

• 20:05Speaker 00

  With the CEO, you know, with the founder, you know, to walk in the door together and, you know, get to the right person. That's the thing of, the other thing that I think I, I bring, because if you take the 10 ideas that have created all of the value of WonderCo in our nine years, he's 10 for 10. They're all his. Seriously. Like, you know, you don't have to be, you know, modest about it. They are.

• 20:33Speaker 00

  What I'm able to do is to accelerate and bring, I think, a level of access and resources and things to it that just make the partnership so powerful. I can't do what he does.

• 20:49Speaker 02

  Well, just to be clear, so the way, the way I think of the partnership is working, so we have, it's two of us and then we have four other partners.

• 20:55Logan Bartlett?

  Okay. And is that the full team or there's?

• 20:56Speaker 02

  No, then we've got like six or seven associates.

• 20:58Logan Bartlett?

  Got it, got it.

• 20:59Speaker 02

  And. We think of the group of partners kind of like a management team. Jeffrey's being modest, I mean, he's the magic. The truth is, without Jeffrey, we're just a bunch of people with reasonable resumes. But there's, as you know, 500,000 people like us. There's one person like him in this world, in my opinion.

• 21:21Speaker 02

  So that's magic. And that's like, how do you potentially super accelerate or amplify a project that we're involved in? Chen Li Wong, who's been with us since the beginning, is like our chief product officer.

• 21:35Speaker 02

  Chen Li, he was your classic term and scholar computer scientist from Stanford. Went, did Goldman, TMT Banking, went to NEA. He was like one of the two rock star. You guys overlapped there? Yeah, that's how we knew each other. And Scott Sandel, who now runs NEA, he and I had done investment at Workday back then. Chen Li left to go to Workday. When I went to Dropbox, he was literally the first phone call. I was walking out of talking to Drew and I walked in, I called Chen Li. I'm like, I need you to, I need you to come do this thing. And the joke at NEA was, SuJie must have realized real work has to be done. That kind of thing. And Chen Li's like, actually, my favorite Chen Li story, Joe Lonze told me this one. So at Clarium, at Peter's, Peter's hedge fund.

• 22:18Speaker 02

  They used to administer some sort of IQ test equivalent to every candidate who was applying for a job. And Joe told me that Chen Li scored the highest of anyone who ever took that test. So he's like an off the charts kind of guy. If you spend time with him, you will just, he's a great guy. So Chen Li's kind of like our chief product officer. By doing investments as well? Yeah, for sure. And he's an awesome venture guy as well. But when we're doing a build, I'm talking about the build, like when we're building a company or if one of the venture portfolio companies needs help on product and engineering, Chen Li goes deep in that. He ultimately ran the core product engineering team at Dropbox. So like what Dropbox was, the core product. And growth, monetization, data science, analytics, all of that was Chen Li's.

• 22:57Speaker 02

  And then Jeff Nikin, who runs our New York office, he was a college buddy of mine, was kind of like the smartest guy at Princeton when we were there. He actually came from the hedge fund world. So he was a managing director at one of the early Tiger Cubs, Shumway Capital, which became a $10, $9, $10 billion public hedge fund. He then started with all the Shumway Partners, another one called Cider Mill. So he's a super analytical stock picker person, but because he had started Cider Mill, he understood the entrepreneurial journey, which is so different than just picking stocks. Like it's, it's, you can intellectualize it, but unless you've gone through the process of like putting those like initial documents together.

• 23:33Speaker 00

  Sure.

• 23:34Speaker 02

  Like trying to build an office like you're doing right now.

• 23:36Speaker 00

  Raising the money.

• 23:37Speaker 02

  Raising money, getting people to believe in you, convincing them to quit their jobs to come join this crazy mission you're on. It's just unexplainable to people. It's a, it's a, it's a very unique process. And so he had gone through that on the finance side. He now runs our New York office. He's kind of like, you know, he's all of our fintech, all that's kind of stuff is what he covers, but he's also effectively like a CFO kind of, kind of figure for a lot of these companies. And then we've got another person who's pure magic named Anthony Salley. I don't know if you've come across Anthony, you would love him. Anthony has been a great seed investor now for 14 years. He invested in Dropbox in the early days. He did Cedar Series A and Coinbase, Kuipang, Robinhood. I mean, the crazy, crazy roster. The way he got into it is fascinating.

• 24:20Speaker 02

  He was an undergrad in, in college in New York, working kind of as part of the extended team that was supporting Nas. And one day Nas fires his entire team except for Anthony and Anthony, like as a junior in college or something.

• 24:36Speaker 00

  20 years old.

• 24:37Speaker 02

  Becomes Nas' manager.

• 24:38Speaker 00

  What year is this?

• 24:39Speaker 02

  This is 2008 or something. 2007, 2008.

• 24:41Speaker 00

  Okay. Now you remember in that 2007, 2008, Nas is literally the biggest rap artist. He's popular, whatever that album.

• 24:50Speaker 02

  I mean, dude, he's like, I mean, these guys are, he's like incredible, right? And so like true historical icon in music and. Anthony basically built this music management. Actually, he has Kendrick Lamar now. So that's, he, I mean, he's like, he's the coolest person in tech.

• 25:06Logan Bartlett?

  Right, but he works full-time with you guys?

• 25:07Speaker 02

  Yeah, he has, I mean, he has a music management company. That he oversees. That he oversees, but he works, you know, closely, you know, like he, Super Bowl halftime show, all this stuff, right? And, but he runs our seed fund. And Anthony, um, the way he got into the seed investing business was he read that Ben Horowitz likes rap music. Yeah, yeah. And he cold emails him and says, hey, you know, we're thinking about maybe, and this is 2009. We're thinking about maybe, you know, Nas and I are thinking about maybe investing in some tech companies. Would you be willing to like, teach us something? And Ben replies like, according to Anthony, in like two minutes, saying, do you want to have dinner tonight? That's so funny. And, and I met Anthony through Ben, uh, when we were doing some Dropbox stuff.

• 25:48Speaker 02

  And so Anthony is, he's like literally the guy, I mean, Jeffrey loves to say this. Chenly has more IQ than anyone else in the shop and Anthony has more EQ than anyone else in the shop. Interesting. Well, I actually say he has more IQ than all of the rest of us at Adop. And Anthony has more EQ than the rest of us.

• 26:07Logan Bartlett?

  You'll give the IQ thing away.

• 26:09Speaker 02

  Yeah, so, so they're, I mean, anyways, Anthony's magic, they're, they're both magic. Uh, and then we just promoted a sixth partner, uh, who started with us in our first associate crop in 2017. Justin Wexler. And Justin, you know, he kind of did the old school venture associate route, went to business school, came back. The thing we loved about Justin is he is a dog with a bone. He's like Jeffrey. If he decides he needs to help a company sell something, or if he wants to go track down something, or meet some executive, he will not, he's relentless. And he's the kind of guy that we said, you know what, we have to bet on this person because he is, you know, he doesn't have the same track records as everybody else yet. But boy, if someone's going to have it that we know close, you know, that we're close to, it's going to be this guy.

• 26:53Logan Bartlett?

  So, so six of you at the partner level? And, uh, how many investments a year?

• 26:59Speaker 02

  Five to six venture, one build.

• 27:01Logan Bartlett?

  One build, and that will, how much money will it be in a given year generally?

• 27:07Speaker 02

  I don't know. I mean, it all depends how much we can raise. Yeah. I don't know, like, call it a 150 a year. Okay, 150 a year. 200 a year, something like that.

• 27:15Logan Bartlett?

  And so what, um, what makes a company that you guys are looking for? And how do you actually make the decisions? Is it consensus? Is it, uh, you know, silver bullet, different people? Or is it tug of war?

• 27:24Speaker 02

  It depends if we're building something or if we're venture.

• 27:28Speaker 00

  You know what? It's such a compatible group.

• 27:31Speaker 02

  Yeah.

• 27:32Speaker 00

  And the process is just so strong. We, it is one of those things where everybody has such high regard for one another that you want to know what Anthony thinks.

• 27:43Speaker 02

  Yeah.

• 27:44Speaker 00

  You want to know what Chen Li thinks. You want to know what Mike can think. Like, you want those voices at the table strong. And you encourage them to speak their mind, always, you know? So I don't, I wouldn't say that it is, you know, vote consensus. It's sentiment consensus, right? If somebody's violin thinks, oh, my God, this is a mistake. But we've never had it.

• 28:10Speaker 02

  Yeah, we, I mean, by the way, we're not right all the time, obviously. Uh, I wish we were. Um, I think the, the process is very much, I mean, it's kind of like we're all doing the same thing, right? It's you're trying to build as prepared a mind as possible. That prepared mind process comes from fundamental research, market mapping, playing with every available new innovation you can. But also just talking to the smartest people in the network, talking, collaborating with other people. We're very collaborative. We're not in the, you know, this is our ball. We're, you know, we're trying to grab all of it, you know?

• 28:42Logan Bartlett?

  But it sounds like you guys err on the side of like consensus rather than, hey, other groups will be a little bit more, um, IC oriented, where someone gets like a silver bullet or they take feedback from the partnership. But then ultimately it's their decision if they really want to push it through. It's sort of like.

• 28:57Speaker 00

  We've never worked that way.

• 28:58Speaker 02

  We're like a management team.

• 28:59Logan Bartlett?

  Yeah, yeah, yeah. And, um, I guess has, I mean, it sounds like a lot of this group has been together for a long time.

• 29:08Speaker 02

  Anthony's been there since the beginning. Actually, Anthony was one of the people that connected us in the, in the beginning.

• 29:11Speaker 00

  Anthony is one of my son's closest friends.

• 29:13Logan Bartlett?

  Oh, is that right?

• 29:13Speaker 00

  Yeah.

• 29:14Logan Bartlett?

  So, so there's implicit kind of trust in the, in the group and.

• 29:17Speaker 02

  We've been through plenty of ups and downs now.

• 29:19Logan Bartlett?

  Yeah.

• 29:19Speaker 02

  You know, like, in, in. We stuck it out. You know, it's like so much of this industry is about grinding through the hard times and capitalizing on the good times, then grinding through more hard times.

• 29:31Logan Bartlett?

  Totally. Well, there's like two different models.

• 29:33Speaker 00

  But I would just say, Logan, for me, the test of a partnership is really how much do you look forward to being together, literally? And I just have to say, in the case of every one of our partners, I'm happy when I'm with them. One of them, all of them, I literally, they are, you know, they're wind beneath my wings. Like, I just feel like I'm excited, challenged, and, you know, when somebody, take family

• 30:15Speaker 00

  out of the equation, if you have a handful of these in your life, you're very lucky. And this is when somebody walks in the door, like, you know, a great friend, or a partner, or a colleague, and you're just like happy to see them, I feel that way about our five partners.

• 30:31Speaker 02

  Yeah.

• 30:32Speaker 00

  I'm like, I'm just happy to be with them. And out of that, you only find, you find things to succeed together at, you know? It's not about taken down, it's about building up.

• 30:45Logan Bartlett?

  Yeah, well, and I sort of think there's two different constructs, plus or minus in the industry. There's sort of the cherry picked model, which a lot of venture firms will look to the outside more often than not, and try to pull people in. I was at Battery for six years, now I've been at Red Point for five and a half. They were looking for someone, and they pulled me in. Now my two partners have sort of grown up within the firm. But more or less, I think some firms kind of gravitate to looking to the outside, and some firms gravitate to looking to the inside as they evolve over time. It sounds like initially, from the ground up, you guys were opting into people that you wanted to work with, that you knew network wise, that you knew from.

• 31:21Speaker 00

  Well, we didn't. I mean, we bet, I mean, that was, you know, you go back to nine years ago, the gamble, particularly on the people who gave us capital. Was most partnerships don't work.

• 31:33Logan Bartlett?

  Yeah.

• 31:33Speaker 02

  You guys get along.

• 31:34Speaker 00

  Yeah, like literally, we couldn't be more different.

• 31:38Logan Bartlett?

  Did you guys do trust falls and stuff to like, you know, like rope course? Like, how did you guys get the?

• 31:42Speaker 02

  We just jumped off a bridge and.

• 31:45Speaker 00

  But I mean. It's witch and Sundance.

• 31:47Logan Bartlett?

  Yeah, yeah. It'll be okay. Sounds like you guys talked every day, though, and just sort of built the trust over time, had enough commonalities.

• 31:54Speaker 02

  You never know until you go through really hard times.

• 31:56Logan Bartlett?

  Yeah.

• 31:57Speaker 02

  Good times are easy. Things are like, you know, should we shut this thing down?

• 32:00Logan Bartlett?

  Yeah.

• 32:01Speaker 02

  You know, that's when you know whether you want to be partners with somebody.

• 32:03Logan Bartlett?

  Yeah.

• 32:04Speaker 02

  And, you know, Chenly and I had it and the way Anthony and I had it, because we had, you know, several years together. You know, Jeff joined in 2020 or 2021. But I knew from knowing him for so long that it would be likely to work, but you never know. But, you know, the thing that was the big risk, as Jeffrey said, was whether he and I would really have. And it's been, I mean, he's like, I mean, I don't want to comment on his age, but he's like a second dad for me.

• 32:28Logan Bartlett?

  Yeah, yeah.

• 32:28Speaker 02

  You know, it's, he's an amazing.

• 32:29Logan Bartlett?

  Well, and that's what helps you really validate, especially with emerging managers, like, you know, when they're underwriting to a first fund or whatever, it's like, we're underwriting the risk that a partnership blows up and a lot of them do, by the way.

• 32:40Speaker 00

  Most, by the way, in life.

• 32:42Logan Bartlett?

  Life.

• 32:42Speaker 00

  I mean, I, you know, I, as I said, you go back and I can go, I could have gone on with the analogy about partnership and just say, I just had my 50th wedding anniversary in Hollywood.

• 32:53Logan Bartlett?

  Yeah, wow. Not too many of those.

• 32:57Speaker 00

  I think I'm a true unicorn on that.

• 32:59Logan Bartlett?

  I was gonna say, those can make sure to dog years a billion.

• 33:02Speaker 00

  Yeah, yeah. You know, and so I really, I just like, I think about partnership, I think about friendship. These are things that are just so foundational. And I think about how, you know, uh, character. And so one of the things that I, I love about SuJae, and it's so interesting because,

• 33:24Speaker 00

  to find these two qualities in a person, one person, is in itself a unicorn. It's a contradiction, which is in order to be a great investor.

• 33:39Speaker 00

  Or in for the most part of my career, a picker. You have to be able to do these two things. One, you actually have to be able to see a dream. Somebody tells you an idea, right? And if you're not a dreamer also, it's not going to be possible for you to actually, for a moment, put yourself in their shoes and see their dream. And, and understand what that might be if it actually, you know, realized itself in it. On the other hand, most dreams don't come true. And you need to be skeptical and cynical. So think of the contradiction

• 34:22Speaker 00

  of being able to see a dream and also being able to be skeptical and cynical at the same time, because it's about filtering through, you know, what are, what are the, you know, are the best of those in this? And the thing that is we, we laugh about because, you know, a day in the life of Sujay is, I love this idea. It's the greatest thing I've ever heard. This is a stupid idea. We should not be doing this.

• 34:49Logan Bartlett?

  Aren't those the same idea?

• 34:50Speaker 00

  Oh, yeah.

• 34:50Logan Bartlett?

  Oh, yeah, yeah, yeah.

• 34:52Speaker 00

  Multiple times a day.

• 34:53Logan Bartlett?

  Totally.

• 34:53Speaker 00

  But I, but his process of how he sorts through that and, and he's actually quite verbal about it.

• 35:02Logan Bartlett?

  Yeah.

• 35:03Speaker 00

  He's, you know, the one day is like, okay, well, the world's blown up. Sky's falling and we are dead meat.

• 35:08Logan Bartlett?

  Yeah.

• 35:09Speaker 00

  Hey, you know what? The sky might be falling, but that's going to be good news for us.

• 35:13Logan Bartlett?

  Yeah, yeah, yeah. You're like CJ Ly, horizontal, the couch, all, yeah.

• 35:17Speaker 02

  If you talk to my wife or any of the, those people at Dropbox who work for me, I mean, I think they would describe it as schizophrenia.

• 35:22Logan Bartlett?

  Yeah.

• 35:24Logan Bartlett?

  We can laugh about it, but yeah, the medicinal stuff and all that. I guess I'm curious, you referenced earlier, obviously a great partnership wife, 50 plus years, Eisner, Diller, all the different people that you've worked with over, over the years as well. What do you think? Maybe what's counterintuitive about making a partnership work? Or what's something that's non-obvious? Not, okay, trust and some of those things that maybe are, of course.

• 35:49Speaker 00

  Well, I can tell you about marriage. That's a story. I'll start with that one, because that's actually the simplest one in a way. And, and you know, so I am asked all the time, is there any, is there a secret to? You know, 50 years.

• 36:00Logan Bartlett?

  You're like skipping the after party or something?

• 36:03Speaker 00

  No, it's actually simpler than that. It's just two words. But, yeah, it's, yes, dear.

• 36:09Logan Bartlett?

  Yeah.

• 36:10Speaker 00

  It's not hard.

• 36:11Logan Bartlett?

  Okay, so that's marriage.

• 36:13Speaker 00

  In the rest of life, in the rest in life, I would just say to you, fundamental to partnership, any and all partnerships, is you must be more of a giver than a taker.

• 36:28Speaker 00

  And, and I actually think that's true in life. I think the greatest satisfactions and rewards come if you can actually find more satisfaction from giving than taking. And we could go take that analogy, you know, throw that equation through almost anything in this. I am, I, just in everything, try to be, and I don't succeed at it all the time. I try to be generous. And by the way, I can't say that I had those attributes earlier in my career when I was fighting to get to the top of the

• 37:09Speaker 00

  Mount Everest and, you know, along the way, and I'm sure people would say that, you know, I played hardball and was, you know, bare knuckles and blah, blah, blah. And I'm sure that's perceived to be true on the other side. It probably was true to some degree. I don't, don't think you win in that world without, you know, getting into some knife fights along the way. But, over time, I, I, I really came to appreciate and understand the rewards of, of giving. But, in, in, in business, in credit, in philanthropy, you know, most rewarding thing in the world to be able is to help somebody else.

• 37:48Logan Bartlett?

  What, what surprised you about, um, moving into tech? Uh, like, like directly, Silicon Valley. Obviously, you were exposed to tech and all those stuff you did before.

• 37:56Speaker 00

  The cultures are antithetical to one another. They couldn't be, they could not be more different. I don't think it's that. I just think that, um, it's, uh, the- One is very introspective and the other is sort of much more externalized in it. And so there's, there's a, there's a way more social networking, cultural networking, knowledge, like it's, it's, you know, they really are just so, so very different.

• 38:30Speaker 00

  The work ethic and, you know, the heads down, you know, founders in tech are, they're, they're, they're unique, they're impressive and, and, and, um, you know, so there's just a different dynamic there than I think exists, you know, the cultures of the two worlds are, are really quite different.

• 38:54Logan Bartlett?

  Hmm. Presumably you gotten exposed to some of the stuff in all of this world. I know you guys, I've, I've heard you guys do a wonderful conference for founders and, as well. I think that brings in different media folks or Hollywood folks. What's been interesting to get exposure to that world, like that, that I guess you think maybe within our industry, we could have a little bit more of? You can say nothing too.

• 39:20Speaker 02

  Well, I actually, to answer you, I've not only thought about it in, in the sense of like what we could do better, but I do think the thing we sometimes underappreciate in tech is the value of beautiful things. Like, one of the most interesting things to me about people from, call it Southern California, but you know, the world of media is that they are very tasteful. And there's just, they bring, they sort of elevate environments that they're in and there's a magnetism to them as people in terms of what they say, how they communicate. And I think, you know, we're all nerdy folks up here, you know, in our, in our world, right? And it's like, you know, I think obviously you do a great job with, with, with this as

• 40:05Speaker 02

  a platform, but in general, our crew is like very, as Jeffrey said, internally focused. And we tend to talk to each other, hang out with each other, you know, our, our, you know, we'll go hiking, you know what I mean? But, but these folks are influencing people at a human level, not, not impersonally. And I think it's pretty interesting.

• 40:23Speaker 00

  I think that people in, in, in the media and entertainment are more vulnerable.

• 40:31Speaker 00

  And so the emotional aspects of them, good and bad, are much more extreme. So on one hand, that there's enormous empathy out of many of them, and out of that comes philanthropy and doing social good, and they become activists and stuff. You know, on the other side is, is, you know, sort of outsized egos. Very, very, very needy, very, super needy. Um, and a super insecure, much more so than I would you experience in Silicon Valley. And so it's just, as I said, it's just, uh, uh, they are different.

• 41:08Logan Bartlett?

  Yeah.

• 41:08Speaker 00

  No question about it. And they love being like the people from, one of the things we have tried to do is to bring those worlds together. And what's fantastic about it is, is that when the media, entertainment, movie, TV, sports, music people get to be with, you know, tech, tech founders, CEOs, they love it. And they don't get off, they don't get asked very often, right?

• 41:31Logan Bartlett?

  Yeah.

• 41:31Speaker 00

  So it's one of the things we've done is, is that we've brought these worlds together, both of which, all three of which appreciate one another more than they recognized until they're there.

• 41:41Logan Bartlett?

  Yeah.

• 41:41Speaker 00

  And then it like, they light up and they go, wow, these are really interesting people.

• 41:46Logan Bartlett?

  Hmm.

• 41:47Speaker 00

  All sides.

• 41:48Speaker 02

  You know, it's funny, but as you were saying, this kind of light bulb popped in my head, which is what I think the, I think the reason that insecurity might be there more on a human level is, you know, let's say we built, let's say we, let's say one of us starts a company, we build a product and nobody wants to use it. You know, you take that very personally, like this is your work. For a lot of these folks who are in the entertainment world, if people reject their product, that's them.

• 42:13Logan Bartlett?

  Yes.

• 42:13Speaker 02

  It's, they're rejecting them as human. And in a sense, it's like, it's, they're rejecting my humanity.

• 42:17Logan Bartlett?

  That's the way I feel like about a buddy who's a comedian and it's like, I can go assess his job on a Friday night, I can go to the comedy club and look how he's doing and be like, yeah, no, not great, didn't find it that funny. No one really gets to do that for me.

• 42:32Speaker 02

  No.

• 42:33Logan Bartlett?

  They, they like, don't really know when we got in and what valuation and how the company's doing and all that.

• 42:36Speaker 02

  But even if one of it doesn't go well, you got a portfolio, it's not, they're not, it's not you personally.

• 42:41Logan Bartlett?

  It's not me as a human. It's like, hey, you might be made a bad decision.

• 42:43Speaker 02

  They rejected your decision, exactly, which is a different thing.

• 42:45Speaker 00

  But, but here's the thing, which is. You know, failing has a stigma in movies, TV, sports, and music. That is, as Sujay says, is quite personal. And so particularly in the culture and the world that we live in, you go up and you go down.

• 43:06Logan Bartlett?

  Yeah.

• 43:06Speaker 00

  And they are severe.

• 43:07Logan Bartlett?

  Femurality of.

• 43:08Speaker 00

  And I've watched it so many times with so many people over so many decades. Whereas in Silicon Valley, if you took a great shot and it didn't work, great, start again, right? Like, failure doesn't have the same stigma in this. Even to Quibi, you know, the one truly, you know, big swing and a miss, you know, that I took in the media space in this. In Silicon Valley, it was like, wow, it was a huge idea. It was a real genuine moonshot, you know? And, you know, you can't hit a home run if you don't swing for the fences, right? And this was a swing for the fences. And people in Silicon Valley were like, you know,

• 43:51Speaker 00

  okay, it's too bad it didn't work, but it's not because it wasn't a great idea and that you did every, put your heart and soul into it. And then, by the way, when it wasn't working, you shut it down and gave people as much money back as you could. In Hollywood, it's a black eye. It never goes away, literally. And unfortunately, I don't care.

• 44:07Logan Bartlett?

  Yeah, yeah.

• 44:08Speaker 00

  But literally, Sujay, we'll tell you, five years later, and there's just simply never anything that's written about me. At some point, you were gonna get to Quibi.

• 44:17Logan Bartlett?

  I actually, I figured you guys that you, there's enough forums of answering that question.

• 44:23Speaker 00

  I, listen, I have been given way, way, way, way, way, either so much or too much credit for all the successes that I have had in my career. More than I'm deserved. I'm okay owning my failures.

• 44:38Logan Bartlett?

  Yeah.

• 44:39Speaker 00

  You know, fortunately, there are way, way, way fewer of them than there are the other. And so you can't have it one way. You gotta take both.

• 44:47Logan Bartlett?

  Yeah.

• 44:48Speaker 00

  If you're gonna own your success, then you gotta own your failure in this. And so I, again, I wished it had worked, but I'm certainly proud of the shot that we, that we took.

• 44:59Logan Bartlett?

  What has you guys excited these days?

• 45:03Speaker 02

  I mean, obviously, all the stuff we're all collecting.

• 45:07Logan Bartlett?

  AI is just changing the world.

• 45:08Speaker 02

  Yeah, so we all know that it's a platform change, the first meaningful one. You know, and the reason 2008, 2010, 12 were such great years for our industry was you had, you know, social media, you had the cloud, you had mobile devices. And so it enabled all this amazing, you know, product development that solved big problems for people at home or at work, right? And then we've all been kind of waiting.

• 45:30Logan Bartlett?

  Yeah.

• 45:31Speaker 02

  For like 15 years.

• 45:32Logan Bartlett?

  It was basically, basically AWS and, and the App Store kind of launched around 07.

• 45:37Speaker 02

  And marketing on social media.

• 45:39Logan Bartlett?

  And marketing on social media.

• 45:40Speaker 02

  Customer acquisition on social media, right?

• 45:41Logan Bartlett?

  Yes.

• 45:42Speaker 02

  So those three things like fundamentally changed literally everything.

• 45:45Logan Bartlett?

  Yeah.

• 45:45Speaker 02

  And so you could build businesses doing anything and do something magical.

• 45:49Logan Bartlett?

  Yeah. And so we got the data dogs and the crowd strikes and we got the bite dances and the Instagrams and the whatsapps and the ubers and the...

• 45:56Speaker 02

  And so many, right? Like, and, and all the enterprise business, I mean, it's just crazy what we've got.

• 46:01Speaker 00

  It feels like this is that time again. And again, maybe there's too much hype, maybe the bubble's too big, but this one is for real.

• 46:09Logan Bartlett?

  Yeah.

• 46:10Speaker 00

  Like, you can see literally transformational, not evolution, revolution out of the power of, you know, of, of, of supercomputing and AI and these apps. I mean, they're, it's just, it is a change the world moment. Uh, and we're seeing things that are exciting. Um, it, no question, right now, uh, it's a bit too frothy.

• 46:38Logan Bartlett?

  Feels that way.

• 46:39Speaker 00

  Mostly feels like it's just gotten ahead of itself a bit, but that's not to say it isn't a, a, a sea change.

• 46:46Logan Bartlett?

  Yeah.

• 46:47Speaker 00

  It is.

• 46:47Logan Bartlett?

  The internet got ahead of itself and we still had Google and eBay and Facebook and Amazon and...

• 46:52Speaker 02

  And, you know, my guess is net-net, it was still like an outstanding.

• 46:55Logan Bartlett?

  Oh, for sure.

• 46:56Speaker 02

  If you indexed 1995 to 2000, as much as like the commentators like to make fun of the excess, I bet you still did great.

• 47:02Logan Bartlett?

  Yeah.

• 47:03Speaker 02

  You know?

• 47:03Logan Bartlett?

  Interestingly.

• 47:04Speaker 02

  If you indexed it.

• 47:05Logan Bartlett?

  If you indexed it.

• 47:06Speaker 02

  If you indexed it.

• 47:06Logan Bartlett?

  And that's the interesting thing is you sort of had to get into...

• 47:09Speaker 02

  Everything.

• 47:09Logan Bartlett?

  The the eight names that really mattered.

• 47:12Speaker 02

  Totally.

• 47:13Logan Bartlett?

  Powered through and some of them actually came later. If you look, I mean, you know, Facebook came a little bit later. Google came a little bit later. Um, so yeah, it's interesting, but I guess.

• 47:21Speaker 02

  No, Google was ninety eight, ninety eight, ninety nine.

• 47:22Logan Bartlett?

  Ninety eight, ninety nine, but but.

• 47:23Speaker 02

  Yeah.

• 47:24Logan Bartlett?

  Ninety, yeah, ninety nine. Yeah, but but I guess it it was on the later part of the internet wave. Like, I guess if you were at a time base.

• 47:31Speaker 02

  Yes.

• 47:31Logan Bartlett?

  If you were to index against Netscape and ChatGPT, we probably haven't, Google probably hasn't been founded. Uh, I think it was Netscape was ninety two, ninety three and Google was.

• 47:42Speaker 02

  Maybe ninety five.

• 47:43Logan Bartlett?

  Yeah, and so, um.

• 47:44Speaker 02

  Ninety four, ninety five.

• 47:45Logan Bartlett?

  So I think I think we're around the time of, uh, if ChatGPT is the Netscape moment, we're probably around the time of Google getting started, which is interesting to think about.

• 47:54Speaker 02

  Yeah, I just think it's gonna have, I just think distribution is so much more compressed now.

• 47:57Logan Bartlett?

  There's an acceleration of all that stuff.

• 47:58Speaker 02

  Acceleration.

• 47:59Logan Bartlett?

  Yeah.

• 47:59Speaker 02

  I think, again, we're just gonna see the human creativity is being unleashed in these kind of new ways. Uh, I think we'll, we'll find out. We like to remind everyone internally over and over again that at the end, and we've been doing this since the beginning, but like at the end of the day, there's probably around the world, five to fifteen, five billion plus company, you know, ultimately five billion dollar plus companies created every year.

• 48:20Logan Bartlett?

  Yeah.

• 48:20Speaker 02

  And, you know, in our, in our typical portfolio, we're talking about twenty five companies, twenty, you know, of which five are billed, so take those out. But of the twenty, which is three years period, we gotta get at least one or two a year. That's, that's our job is to get at least one or two of the five to fifteen every year. And even in the middle of a bubble, I guarantee you there are gonna be Googles created and things like that. And so be like, I, I, in general, I think being cynical in our world about excess and bubbles is a silly, silly, silly game. I think on an.

• 48:55Logan Bartlett?

  You sound smart.

• 48:56Speaker 02

  On an individual, you sound, you always, you can sound really smart being cynical.

• 48:59Logan Bartlett?

  Really.

• 48:59Speaker 02

  Right? Like people, like people who can put out negative, critical things about anything always sound smart.

• 49:04Logan Bartlett?

  And by the way, you're, you're probably gonna be far more, uh.

• 49:08Speaker 02

  You'll be right on a percentage per time, on a percentage basis.

• 49:11Logan Bartlett?

  But when you're wrong, it's really.

• 49:12Speaker 02

  In a power law business, it turns out, it doesn't matter if you're wrong 99 times. It's that one time that makes all the difference. You know, it's funny because I didn't realize you never get your money back in venture. And so I, you know, from, you know, in 2012, I started.

• 49:25Logan Bartlett?

  You've already allowed checks in.

• 49:26Speaker 02

  Yeah, so.

• 49:27Logan Bartlett?

  Oh, there's this carry thing that goes.

• 49:29Speaker 02

  Yeah, yeah, well, no, it's so, it's so even before, this is even worse than being on the venture side. Because in 2011, I think I started a program where everyone at Dropbox could sell some percentage of their holdings. And so we had liquidity starting around then. And so, of course, I would start investing in all the venture funds. And so I, I invested in dozens and dozens and dozens of venture funds.

• 49:50Logan Bartlett?

  Probably good vintages, all things considered.

• 49:52Speaker 02

  Phenomenal. On paper, they should be amazing.

• 49:53Logan Bartlett?

  Yeah, better than 2020.

• 49:55Speaker 02

  Yeah, but then you, you fast forward and I'm still like, dude, when am I going to get my money? Give my principal back at some point, you know, kind of thing. It's been 15 years. But, but the funny thing is, when you look at the underlying portfolio companies.

• 50:06Logan Bartlett?

  Amazing.

• 50:06Speaker 02

  It's, well, there's, but it's amazing, but it's still one out of 50.

• 50:09Logan Bartlett?

  Yeah.

• 50:10Speaker 02

  And that one.

• 50:10Logan Bartlett?

  One out of 50 investments.

• 50:11Speaker 02

  One out of 50 investments in a fund will be amazing. And by the way, that one out of 50 is going to return like, in some cases, 15, 20x on the fund. But, boy, that's 49.

• 50:21Logan Bartlett?

  Totally. A lot of losses.

• 50:23Speaker 02

  A lot of, a lot of.

• 50:24Logan Bartlett?

  I don't know if I have like the mental fortitude to do like super early stage investing because you have one company goes really, really well. And then you, you mostly, you know, there's a lot of cheerleading going on and like, yeah, keep doing more of this stuff. And of course you help and I'm making it simple. And then there's a lot of shitty board meetings. And you know what? Like the proportionality of pain you feel, it's like that loss mitigation framework or whatever. You feel pain two or three times, like worse than you feel success. It's an interesting thing. Yeah, I was actually looking.

• 50:53Speaker 02

  Are you like that? Are you wired to, like, if you have something that loses money, does that hurt you more than the fun of the winners?

• 51:00Logan Bartlett?

  I've, I've had to, it's been an interesting internalization. Battery was much more, I would say, growthy in nature where it was like, you know, let's make sure every investment has a good shot at a 3x, 4x, 5x in that range. And Red. What I've had to internalize is a lot more like swing for the fences. Hey, if we're not, if we don't have a shot at a 10 to 15, 20x, like, what are we doing?

• 51:25Speaker 02

  Yeah.

• 51:26Logan Bartlett?

  And there's been a, I think if you go back and look, like, my first couple of investments at Redpoint, you could see I was trying to internalize both elements of it. When I go back and look at, like, you know, what I was thinking, or reread the memo or all that, there was elements of both. And honestly, you need to, you need to pick one. Both can be great answers, but you kind of need to pick which side of the fence you want to be on. I, I, I saw something recently that 1% of all exits, uh, um, drive, I think, like 50 to 55% of value in venture. And so it's like-

• 51:58Speaker 02

  I'm surprised it's not even more than that.

• 51:59Logan Bartlett?

  I, I, it's 1% of exits, so that's not counting shutdowns and all the zeros. So it's probably like 0.1% if you count all the things that you don't have any exits around. Uh, which makes sense. There's a power law. And it's even true at, like, later stages. I think, uh, any fund that generates, um, like over 3x, I think, um, 64% of their value comes from a single investment, something like that.

• 52:26Speaker 02

  I mean, it's not surprising at all. I mean, it's, you know, it's funny, when I think back at my personal investments, which again, I used to do a lot of that, everything is through Wonderco now. But my two best personal investments where I put in 2009, a third of my, at the time, net worth, which wasn't much, in Facebook secondary at 8 billion.

• 52:45Logan Bartlett?

  Wow.

• 52:45Speaker 02

  And, which, which is what allowed me to leave NEA to go to Dropbox.

• 52:48Logan Bartlett?

  Did you have a, do you have any connection to the team? Or was this like a-

• 52:51Speaker 02

  So Matt Kohler, who was one of the early execs, he was an analyst at McKinsey with me.

• 52:55Logan Bartlett?

  Oh, funny.

• 52:55Speaker 02

  And he was my best friend.

• 52:56Logan Bartlett?

  Oh, wow.

• 52:56Speaker 02

  At McKinsey.

• 52:57Logan Bartlett?

  For people that don't know, Kohler had a-

• 52:59Speaker 02

  Actually, I want to hear a crazy one.

• 53:00Logan Bartlett?

  Kohler's had an amazing run. For people that don't know, he was, he was, uh, LinkedIn.

• 53:04Speaker 02

  He was the first employee at LinkedIn.

• 53:06Logan Bartlett?

  He was like Reid Hoffman's, like, like EA turned chief of staff turned, like, first employee or something?

• 53:11Speaker 02

  I don't know if he got, if that was quite, it wasn't exactly quite the path.

• 53:14Logan Bartlett?

  Someone said, I think the story I heard was, you know, someone's going to correct me on this. But I think I heard the story was Reid was like, yeah, I'm not really hiring, but I need people to, like, you know, help me schedule and put this thing together. And he was like, okay, I can do that, too. So maybe it's an exaggeration of it.

• 53:29Speaker 02

  Maybe there's some truth to that. It's not how I remember it from back then.

• 53:32Logan Bartlett?

  All these stories get mythalized or mythologized in some way over time.

• 53:36Speaker 02

  And well, Matt's had one of the more extraordinary careers.

• 53:40Logan Bartlett?

  So wait, but then Facebook after that, then?

• 53:42Speaker 02

  And then SpaceX. So my buddy, John Herring, who runs VY Capital with Alexander Tomas, started investing in SpaceX. I mean, there must be a second largest investor in SpaceX or something. And he put together like a group of friends to invest in SpaceX at 10 billion. And, you know, at the time, it was like, hey, they're going to come up with the Starlink thing. And we're like, what are you talking about? Internet? Like, that's going to be the future of rockets. And then it's turned out that's incredible, obviously. And so, you know, you look at it, and so when, like, some of our investors say, well, why are you guys doing some later stage stuff? Like, we put a bunch of money in that last Figma round, which is, you know, we think that's one of the great

• 54:17Logan Bartlett?

  Yeah, it's incredible.

• 54:17Speaker 02

  building companies in some, you know, in Databricks. Ali is a really good friend of mine. And so we did a bunch of Databricks. And they're like, why are you doing that? And I said, well, look, we're just trying to figure out, can we get a 10 or 15 X on something? And so if we think someone, even at a $10 billion valuation, is building something truly generational in a market which has its market, but also the adjacencies that they're going to get into, can justify a $100 billion company one day, which is what we, you know, hope for for Dylan and Figma, or, you know, half a trillion dollar company for Ali, like, those are the kind of founders who can do it. And so we'll do that, you know, which sounds, you know, some folks wonder about that, but that's how we think about it.

• 54:58Speaker 02

  And so we're more modeled on like the way you described how Redpoint is, which is, we want things to be really big. We don't get many shots on goal, like six a year, seven a year. And so we want them to potentially be huge. We also have a lot of confidence in the portfolio because we know that the builds are very safe. Like, those are things that we feel a high degree of confidence can deliver super solid returns for the whole portfolio, which means on the venture side, the juice and venture comes from us hopefully getting a couple of big ones.

• 55:31Logan Bartlett?

  And what do you think about like a Ali or Dylan in those situations? Obviously, the returns there. Is that just a, picking those things specifically from a focus and constraint standpoint? Is that when they show up and you think you have some connection to it and it just feels like this is a special founder and we believe in the opportunity? Or do you actively pursue those things of like chasing the people around and when can they take money?

• 55:58Speaker 02

  I mean, we're, so there's two different things here. One is that we, we, both of us, but also the, the whole group, you know, we've just been friends with a lot of these folks for a very long time.

• 56:08Logan Bartlett?

  Yep.

• 56:08Speaker 02

  And so if you actually were to say, what's the biggest mistake in the history of WonderCo? The biggest mistake was that we didn't do venture from 2016 to 2020. Right? Cause that was that period where all of our Dropbox folks were becoming

• 56:19Logan Bartlett?

  Sure.

• 56:20Speaker 02

  either founders or the top execs at all the next generation great, like literally every one of the next generation great company.

• 56:25Logan Bartlett?

  You're like fighting with Hans to Heimlich.

• 56:27Speaker 02

  Oh no, we don't, we don't invest in your kind of business.

• 56:29Logan Bartlett?

  Yeah.

• 56:29Speaker 02

  Like, why would we invest in this? You know, and it's

• 56:31Speaker 00

  Sujay's greatest regret is literally one of his closest friends is Ali Gotze at ThetaBrick. And he's had the chance to invest in him at 500 million.

• 56:40Speaker 02

  Valuation was always too high.

• 56:41Speaker 00

  At a billion, at 2 billion, at 5 billion.

• 56:43Speaker 02

  Which is always true of the great ones, right? Like, and then, you know, and you look, and if you, you mentioned the Dropbox crew earlier, and you look at that crew, right? You look at the OpenAI management team, like that, I mean, a lot of them, like a huge percent of them worked at Dropbox. You look at Figma's management team, you look at literally every one of these companies, there is one, two, three people on the top, out of the top five or six.

• 57:04Logan Bartlett?

  I want to come back into the investing side of it, but I guess I'm curious because we're talking about Dropbox and that talent density. What, what, what do you think allowed that network to permeate? Cause Dropbox, I mean, Dropbox was the company in what, 12 to 16, 17, something like?

• 57:19Speaker 02

  I think it probably 11 to 16.

• 57:20Logan Bartlett?

  11 to 16.

• 57:21Speaker 02

  Late 11 to 16.

• 57:21Logan Bartlett?

  Yeah. 10 billion was, when was that round?

• 57:24Speaker 02

  I think I raised that in 2014.

• 57:26Logan Bartlett?

  14.

• 57:26Speaker 02

  And I did the 4 billion round in the fall, in August, September of 2011.

• 57:33Logan Bartlett?

  Okay. So, so, so that stretch of time, when those numbers meant something, now they don't.

• 57:38Speaker 02

  Funny how fast it changes, right?

• 57:39Logan Bartlett?

  Right now, it's like, ah, three kids in a garage.

• 57:42Speaker 02

  Yeah, that reminds me when I made Star Trek and like, you know, Pretty Woman. He makes fun of me because I sometimes will reminisce about these days.

• 57:48Logan Bartlett?

  Yeah, yeah, yeah. So wait, so what do you think the, the talent density there, was it just like a compounding thing?

• 57:52Speaker 02

  There were a few things.

• 57:55Speaker 02

  One is that, so Drew started the company with Arash Fardosi. Arash was, and probably still to this day, is the most incisive, insightful person when it came to assessing talented people that we could collaborate well with. Like, he, I don't know how exactly his brand, he was so talented at that. That was number one. Number two is, we all put a ton of effort into recruiting super talented people. And we didn't, we didn't care about experience because none of us had any.

• 58:27Logan Bartlett?

  Yeah. Was that like a top-down directive? Was that an innate thing that you guys just felt some moral or like business-oriented impetus to go pursue?

• 58:37Speaker 02

  I don't know, we just liked, we just liked working with really smart people.

• 58:40Logan Bartlett?

  Yeah.

• 58:40Speaker 02

  And, you know, and it's, and people who, basically if you were to say, what were the three qualifications that, I mean, if you're simplifying it? So one is super talented, super smart. Number two was, would work well with the culture. And number three, were insanely hardworking. And I think I probably slept on the couch at least once or twice a week in that first couple of years. You know, it was a nutty, nutty period. And then, you know, as Jeffrey was talking about partnership and also, you know, it's funny. So Drew is still to this day, one of my best friends. We were so close, I mean, like we, like we officiated each other's weddings. Like we're, like, he is one of the all-time great humans. He's a brilliant guy.

• 59:21Speaker 02

  And I think, like, we just collectively really enjoyed having people of that talent level around us. And then the final piece of the equation is that, obviously you have a little bit of luck in these things, or a lot of luck in these things. And so we were, things were just firing, like, you know, almost, you know, a lot of the growth initiatives we would do would inflect the business over and over again. And when you have that and the business is growing so fast, recruiting someone super experienced from the outside to go, like, a lot of times you'll just say, hey, talented person in X, go do this job. So all of these insanely talented young kids got jobs that they were not qualified for at all. And the ones that did a great job, like are the sort of my, at least my management philosophy at the time, was if someone's doing a great job, make it bigger and bigger.

• 1:00:06Speaker 02

  And if someone's drowning, I don't have time to mentor them and coach them and all this sort of stuff. You just got to move on.

• 1:00:12Logan Bartlett?

  Yeah.

• 1:00:12Speaker 02

  And so we were a little, I don't want to, we were super nice people, but we were a little bit ruthless in the sense that if you were great, you would just get bigger and bigger and bigger jobs. And if you weren't, it just didn't, it was just not going to work out. And so what happened was you ended up filtering for people who had two things. One is that the people who were crushing it ended up getting bigger and bigger jobs. And then they got hired to do really big jobs by the next generation of companies. And number two is like, as you know, what's that whole thing, A players hire A players and whatever. So they were so relentless at only hiring great people to work for them. And so then the, the, the generation below them were also super talented.

• 1:00:47Logan Bartlett?

  Yeah.

• 1:00:47Speaker 02

  In the same thing. So it's kind of like we created a talent culture and a way for this talent, not just to get brought into the company, but also to get jobs that allowed them to maximize their potential in that window, which then resulted in more talented people wanting to join. And so we just ended up hiring lots of great people that way.

• 1:01:02Logan Bartlett?

  Yeah. It's fascinating how all that stuff compounds and cascades on itself.

• 1:01:05Speaker 02

  I mean, I mean, it's crazy. And then of course, the final piece of why it all spread around is, you know, we got stuck at 10 billion. And so if, if Dropbox had been a half a trillion dollar company.

• 1:01:15Logan Bartlett?

  Everyone still be there.

• 1:01:16Speaker 02

  Most of what everyone would say, that's what happened to Google, right?

• 1:01:17Logan Bartlett?

  Yeah.

• 1:01:17Speaker 02

  Like most of the people stayed. And so you didn't end up with that crazy Google diaspora. But why did PayPal have a diaspora? Well, they sold at 1.5 billion. Nobody was rich enough to just shut it down and move to St. Bart's.

• 1:01:27Logan Bartlett?

  Yeah.

• 1:01:28Speaker 02

  Right? So at Dropbox, very few people got rich enough to never work again.

• 1:01:31Logan Bartlett?

  Hmm.

• 1:01:32Speaker 02

  But they were super talented. They had this amazing rocket ship experience and the company had a reputation for having good people. So a lot of other companies wanted to hire out of that, you know, talent pool. And so I think that's a big part of why it all kind of happened.

• 1:01:42Logan Bartlett?

  So going back to the investment side, so, so the AI thing, how, how do you guys pursue the different ideas that you're going after within AI? Is it, is it a kind of opportunistic when this stuff comes in? Or are you doing like top down of what you think might make sense?

• 1:01:59Speaker 02

  It's a combination of all of the above.

• 1:02:00Logan Bartlett?

  Yeah.

• 1:02:00Speaker 02

  That's what we all do. Right. It's a combination of all of it. I mean, I think. The AI stuff is the hardest because the valuations are where they're at.

• 1:02:06Logan Bartlett?

  Yeah.

• 1:02:06Speaker 02

  You know, you're making, but to the point you made about data, it's like the best companies are always overvalued.

• 1:02:11Logan Bartlett?

  I will say, I was reflecting in 2022, the beginning, when the market like totally pulled out and I was looking at all these slides and graphs and publics were down, you know, trading at six times forward or something like across the board. And there were private rounds going down at 150, 200 times ARR. And I was like, we, all, all we say is internally, we want to be in special companies and we don't get too wrapped around the axle on valuation. That's what, that's what we'll say. But, but at that moment in time, I like wanted to add a caveat to the rule of like, except once every like five, 10, 20 years where this, this huge dispersion of valuations. And then at that point in time, we do care a little bit about it. And I was reflecting on, we spent time with three investments at that point in time.

• 1:02:54Logan Bartlett?

  And all of them were just exorbitantly priced, especially compared to the bug markets. And I actually think in retrospect, we probably should have done them all. They've all just sort of grown through and it didn't really matter. Now, had we been wrong and whether or not they were special, it would have materially mattered, but.

• 1:03:10Speaker 02

  It would have mattered, but. You can lose one X.

• 1:03:14Logan Bartlett?

  To the tune of one X.

• 1:03:15Speaker 02

  That's the thing that's so hard to explain. Like we get, you know, for some reason, when people spend time with you, like with you talking about your business in our world. They spend a lot of time talking about, why did that loser happen? Why did that loser happen? When instead, what I would do is spend all my time trying to figure out, for your outlier winners, was that dumb luck?

• 1:03:35Logan Bartlett?

  Yeah.

• 1:03:35Speaker 02

  Or is that repeatable in some way?

• 1:03:37Logan Bartlett?

  Was there some replicable thing?

• 1:03:38Speaker 02

  Is there something that you did with that situation or those situations that will allow you to do that again in your next fund or your next fund? Spending time with the losers, like, it's like, what is the point of that?

• 1:03:48Logan Bartlett?

  Yeah.

• 1:03:50Logan Bartlett?

  So, so within, within the AI thing, like, is there, are there areas that you are particularly interested in? Like, does the media stuff come up and is that intriguing or? It's getting intriguing. It wasn't early on because it was so clear that the rate of innovation is still so steep.

• 1:04:11Speaker 00

  That whoever the winner is a year ago, not going to be the winner today or next year in it. That they're going to get out innovated, you know, by the next generation of it. It's only in these last couple of months that now we're starting to see

• 1:04:30Speaker 00

  some creative tools that are image generation,

• 1:04:36Speaker 00

  audio generation, visual generation, that are pretty compelling. And we've actually invested in one or two of them now that we're pretty, they're early. So, but it's still, if you talk about traditional media in terms of, you know, longer form, I think we're still, whether it's a six months or a year or 18 months, 24 months too soon for, for that. The disruption is 100%. It's not even like a maybe here in it. You know, it is a new set of tools and a new set of skill sets to, you know,

• 1:05:19Speaker 00

  somebody had a great line, which is that

• 1:05:24Speaker 00

  it's not that AI is going to replace people. It's people who know how to apply AI are going to replace people who don't know how to apply AI. That's really where this is going, going to happen. And so in the world of, you know, creativity, that person who understands how to create the best prompt is going to be invaluable.

• 1:05:57Logan Bartlett?

  Is that akin to some of the other technological transitions you've seen happen within movies and, and media at large? Or is it different?

• 1:06:06Speaker 00

  But it's not, I mean,

• 1:06:09Logan Bartlett?

  There's analogies.

• 1:06:10Speaker 00

  Well, yeah. What about hand drawn animation? Yes, I was gonna say, you know, that there was, you know, 70 years of hand drawn animation. And then John Lasseter comes along with this, you know, amazing short film that he made. You know, that, the, the thing that was Luxor, the lamp. And, and it was like a, oh my God, this is, this is a new world.

• 1:06:35Logan Bartlett?

  And that hit you like a lightning bolt when you saw that?

• 1:06:37Speaker 00

  Well, more like a ton of bricks.

• 1:06:41Speaker 00

  And, and, and so this, and by the way, it was exactly that at, at, at DreamWorks. You know, our first movie was a hand drawn animated movie, one of the last, which was Prince of Egypt. Um, and, and then came Hans and Shrek and, and CG animation. And this, and our entire workforce had to be transitioned. We had 1,500 employees and a third of them were in non creative with business and support and tech and all of that. Um, and, uh, that the other thousand there, half of them were able to learn a new skillset. Which is how do you animate with a computer versus animate with a pencil on paper?

• 1:07:25Speaker 00

  And there's some of them adapted incredibly well and half of them were not able to. And so new set, so it's very, very, very disruptive. I mean, you know, painfully. So, uh, but you know, that we, we hadn't done it, we, we would have, you know, been out of business.

• 1:07:42Logan Bartlett?

  Was there, was there comparable resistance to that transition that you're seeing sort of today?

• 1:07:46Speaker 00

  Yeah. Oh, no question. Culturally, very, very, very difficult to, to navigate through it and to come through the other side with lots of, you know, loss and insecurity and, you know, relationships and friendships and, you know, these people were like family. And so, um, for those artists who were not able to, you know, grasp on to the new thing, that wanted to hold on to the old tradition, they got left behind.

• 1:08:14Logan Bartlett?

  I hadn't really thought of this analogy. I mean, uh, I think a lot of the like immediate job disruption transition, uh, at least in the, the knowledge work era as I think about it. A lot of those things maybe were kind of post mainframe, a little bit post PC, that a lot of the stuff that was done by hand started to move to the computer a little bit. So maybe there aren't as many recent lessons in B to B that I can think of of just like pure near term disruption that have happened. So I'm curious in managing that, communicating that, are there things that you would, um, either do exactly the same as you did do or do totally different? That you would maybe say to someone that, um, is thinking through how to leverage these tools

• 1:08:59Logan Bartlett?

  and how to deal with the human element of the transition?

• 1:09:01Speaker 00

  Yes, I would be. 10x more aggressive about embracing change as opposed to fearing change. Change is inevitable. I mean, it's, you know, again, other people have said this, you know, we went through an agricultural revolution and industrial revolution. You know, now we're in the intelligence revolution. And if you do not understand, it is a revolution. It is going to, you know, 200 years ago, 98% of the population was in agriculture.

• 1:09:33Speaker 00

  Today's 2%, you know? I mean, and it's no less important. Agriculture is still fundamental to human survival and existence in this. But people have moved on and there are, there are ways in which you can get redeployed here and this. And so, you know, I, I, I think embracing that change, understanding it, trying to stand in front of it, put your hand up and say, you know, I'm going to slow you down, I'm going to hold on to it. I wished I had gone faster, not, not, you know, I mean, there was a point, honestly, where company was in risk and we were in genuine jeopardy, holding on, white knuckled on a cliff and then Shrek arrived.

• 1:10:19Speaker 00

  And it saved the company. And that, that is that moment, by the way, of, you know, making that full transformation. I made a half version of it, right? I was trying to hold on to, you know, the tradition because I, I, I love the connection between an artist and a pencil onto a piece of paper. There's, it's, there's just something so organic and, and authentic about that kind of creation. And it, you know, was an emotional thing in it and I, you know, I, I, I had been past the, the mantle of this amazing Walt Disney, right?

• 1:10:59Speaker 00

  And I was trying to carry that tradition on and to protect it and, you know, make sure that it prospered and all of that in it. And so. Trying to keep one foot in each world at the same time. It was tough. On the other hand, you know, go back and I was instantly brought, you know, and embraced using computer animation to support hand animation. So I remind everybody the ballroom scene in Beauty and the Beast. There's all that computer work of that amazing dance sequence in it was not possible other than us embracing, you know, state of the art technology there.

• 1:11:39Speaker 00

  Or the wildebeest, you know, stampede in Lion King, you know, those things were not possible two years, three years before in it. So again, just, you know, that tug and pull.

• 1:11:52Logan Bartlett?

  Yeah. The enabling technology always seems, at least psychologically, it's an easier.

• 1:11:57Speaker 00

  Right. But, but, but computer animation, CG animation, what John Lasseter did wasn't evolutionary. It was revolutionary in this. And that's how I sort of differentiate here. And I believe AI is revolutionary, not evolutionary. And, and so to embrace it and to know it and to understand it and to, you know, try and, you know, harness it to make you better, to make you smarter, to make you more effective and more productive and is, is, is, I think, you know, invaluable. No matter what job you have, no matter what you're doing, if you can find a way to, I mean, all of us, I don't know about you, but there's not a day in which now I am not

• 1:12:41Speaker 00

  on every one of these platforms and they are just making me just honestly smarter and more efficient. And it blows my mind how, how much more effective I am on ChatGPT and on perplexity and on Grok and Gemini and like they, if you, you know, I always believe that you can actually tell. Almost everything you know about a person, if you look at the front page of their, of their apps, right? Like that, if you actually went into that and did an analysis of like, well, explain each one of these and understand why it's there versus all this other there. Like, why is that? What is on that front page? And so here's on mine.

• 1:13:26Speaker 00

  Perplexity, Grok, Gemini.

• 1:13:29Logan Bartlett?

  You got them all.

• 1:13:30Speaker 00

  Chat G P T, you know, with WhatsApp, Slack and Google.

• 1:13:34Logan Bartlett?

  That's a little more extreme than I, than I am.

• 1:13:37Speaker 00

  Me too, actually.

• 1:13:37Logan Bartlett?

  Yeah, I think, I think I might have two on my home screen. I don't think I have five.

• 1:13:41Speaker 00

  And each one has something, by the way, just to give them all interesting in that. And Lama, by the way, also, you, every one of them has things about them that are unique and that are invaluable in this. And so I'm just trying to, I'm trying to learn every day.

• 1:14:00Logan Bartlett?

  Yeah.

• 1:14:00Speaker 00

  Every day is, you know, just like something, something new is coming along here in this. And it's, it's just wild, wild.

• 1:14:10Logan Bartlett?

  So, so as you think about, like, are your incubations in this field yet? Or are they mostly?

• 1:14:15Speaker 02

  We've done one. I mean, the problem that we have in AI from an incubation standpoint is we're not the smartest people in the world at it. Like for us to do something that's a build, it means we have to think that we're the most qualified people to do it.

• 1:14:30Logan Bartlett?

  Yeah.

• 1:14:31Speaker 00

  Yeah. So we're in dog roaming.

• 1:14:32Speaker 02

  Yeah. Yeah. So we're, yeah. So we've got, you know, we've got.

• 1:14:35Speaker 00

  AI isn't going to touch dog roaming.

• 1:14:37Speaker 02

  Well, consumer cybersecurity was our big rock. That was, that was where, I mean, frankly, I, I'm really proud of the stuff we've done there. It's pretty cool. Well, so Aura, A U R A, so this guy Hari Ravi, have you, have you ever had Hari on?

• 1:14:50Logan Bartlett?

  No, I haven't. But I know the business from the outside in. And I, I remember I was first exposed to it because they're the Timberwolves sponsor.

• 1:14:58Speaker 02

  Yeah, that's right.

• 1:14:59Logan Bartlett?

  And so I was like, every time I see a random, I'm watching a basketball game and I see a new sponsor, I'm always like curious. I'm like, what is that? And.

• 1:15:06Speaker 02

  Why does this company have so much money to waste?

• 1:15:07Logan Bartlett?

  I know. I'm like, like either I need to learn what this business is, or I don't need to learn what this business is. And I'll figure out, either way, I should figure out which one.

• 1:15:15Speaker 02

  Usually the latter, but fortunately, in this case, I think the former. But so we're, we're a couple hundred million of our own now.

• 1:15:22Speaker 02

  You know Hari is a, I mean, he's our other partner, even though he's not our partner. Yeah. At WonderCo. He is unbelievable. He is one of the rare people who is super deep in business and also super technical. You know, those are like the most special entrepreneurs are the ones who can figure, like learn both, both sides of this thing. And what we originally set out to do, which was an idea he had and an idea we independently had. And then Trevor Olshig from General Catalyst put us together. Hmm. Because he's like, you guys are both trying to do the same thing. You should meet each other. And which was that this is 2018 and 19. Um, at that time, every week you'd open, you'd open the newspaper, go on whatever, Wall Street Journal.com or whatever it was. And it would be X corporation

• 1:16:06Speaker 02

  got hacked, 80 million social security numbers are breached, or grandmother took a spam call and gave away her bank account information, or this creep was found compiling like social, you know, like social media profiles on the dark web, or someone reused their password. I'm going to go on and on and on and on, right? And it was like, okay, I guess the little trade we've all made is for the, all the joy of being on the internet, one day we're going to like lose all of our financials, you know, all of our, all of our money. And that's just, you know, that's just kind of the price of being online. Yeah. Is that we're going to get breached or hacked or what have you. And we kind of had this aha moment. We're like, that's insane. That is like an insane trade. Why has the world gotten to this place? And, you know, we say this jokingly, we have a lot of friends in private equity,

• 1:16:51Speaker 02

  but we like to joke that, you know, a good target for us is when a, when an industry has gotten private equityified. Yeah. Because it basically means they've gone, the companies tend to go into cash flow mode. Right? They, and one of the easiest ways to generate a lot of cash flow is to kill all long-term R and D. Yeah. If the R and D is going to pay out seven years from now, why would a? Three to five year hold owner invest in a seven year payout like EBITDA killer. They wouldn't, right? And so, and even if they would, engineers don't really believe that. And so they all bail anyways. And so I think what happened is by and large, the entire series of companies that were set up to protect all of us online, starting at the antivirus companies and everything else, just stopped innovating.

• 1:17:35Speaker 02

  You cannot think of a new product out of the old AV companies in like two decades.

• 1:17:40Logan Bartlett?

  And they were all desktop and they were mostly anti-viral.

• 1:17:43Speaker 00

  Yeah.

• 1:17:43Speaker 02

  Yeah, but I'm saying, but you can't think of any innovation, right? Like it's, it's nuts. And so we said, okay, well, that's the problem.

• 1:17:49Speaker 00

  Yeah.

• 1:17:49Speaker 02

  You basically have incumbents that aren't innovating. You've got like a threat, a group of threats that are of course innovating. And somebody should go do something about this.

• 1:17:58Logan Bartlett?

  Their founders have murdered more people than they ship new products.

• 1:18:02Speaker 02

  Right, right. By the way.

• 1:18:04Logan Bartlett?

  I say that kind of tongue in cheek.

• 1:18:05Speaker 02

  Totally half joke, tongue in cheek, right? And so, you know, then of course the logical thing for us is like, okay, well, let's go meet all the startups doing this. And what we realized is the problem is the surface area is so big. You've got to protect people in all these different ways that unless you're, you know, there was a, there were, there was a group of point solutions that were big enough that you could build independent companies like One Password.

• 1:18:24Logan Bartlett?

  Sure.

• 1:18:25Speaker 02

  Phenomenal business that we're investors in and, and you know, Nord VPN is an amazing job and desktop VPN, but there's a very small number of these, of these, of these kind of point solutions that could be big enough to become their own companies. Most of them were just sitting in like early adopter land. And so then we kind of had like an outsider's style idea, which is like, all right, well, what if we put all these together and build a suite?

• 1:18:47Logan Bartlett?

  And what is all these together?

• 1:18:48Speaker 02

  You know, like everything from identity protection.

• 1:18:51Logan Bartlett?

  Identity protection is password management or it's?

• 1:18:53Speaker 02

  No, identity protection is actually like monitoring your identity online.

• 1:18:57Logan Bartlett?

  My social security is on dark web.

• 1:18:59Speaker 02

  Financial information, like all that sort of stuff. All the way through to, you know, VPN and AV and all this password management, all this sort of stuff. But then, and that was, that was where the business got going. And that, we know Jeffrey referenced that we had bought a public company. We actually bought a public company in the identity protection space.

• 1:19:13Logan Bartlett?

  How big of a business was that?

• 1:19:14Speaker 02

  That was, I mean, I think, I think valuation was like, it was trading like 50 million. It was like kind of a dying public company.

• 1:19:21Logan Bartlett?

  We're doing.

• 1:19:21Speaker 02

  Identity protection purely.

• 1:19:22Logan Bartlett?

  About that in revenue or?

• 1:19:23Speaker 02

  No, so here's the crazy thing about it. They were a, they would, basically it was, it was kind of like a LifeLock style product. That their go to market was the big banks would sell it to their customers. So Bank of America, or Citigroup, or whatever, would sell this identity protection to their customers. I don't remember if it was white labeled or not, but I think it might have been. And they grew really fast in like the 2000s doing that. And then the CFPB passed some regulation in 2011. I don't, I don't remember exactly what it was. That basically all the big banks said, you know, we're not, we're done with third party products. There's too much risk, it's not worth it, we're done selling through. So this public company, which it had, was kind of been a bit of a rocket ship. Uh, went into like this melting iceberg phase.

• 1:20:05Logan Bartlett?

  Do you know what peak valuation was for him?

• 1:20:07Speaker 02

  I don't remember. My guess is probably 500 million to a billion. It wasn't like a giant, I mean, but it got to the 400 million revenue, I think at the peak in 2011, 2012.

• 1:20:15Logan Bartlett?

  Yep.

• 1:20:16Speaker 02

  And then when we saw it, it was at 140 million. And this is actually a case study of an associate doing a great job. So we were in this space, we were looking for more things to do in this space. One of our associates, this kid, Tom Cooley, who's now a partner at Sequoia. Tom, you know, came to me with this thingy, you know, he was like, look, we should be really thinking about buying this thing. It's like 140 million of revenue at that point in time. It's shrinking really fast.

• 1:20:41Logan Bartlett?

  Yeah.

• 1:20:42Speaker 02

  But the stock market hates shrinking public companies with very little EBITDA. And so it's trading at like a 50, I'll call it 50 million dollar market. And I was like, Tom, how the hell, it's in Chantilly, Virginia. What are we gonna do with this rapidly melting iceberg?

• 1:20:57Logan Bartlett?

  Chantilly, Virginia, that sounds like a made up place.

• 1:20:59Speaker 02

  By the way, by the way, for all, for all intents and purposes, it could have been, right? And so I, and, and he was a dog with a bone. And, and he would listen to the earnings calls. He would call the management team and get whatever he could. There was like one analyst covering.

• 1:21:11Logan Bartlett?

  I was gonna say, yeah, not a lot of people dialing into that.

• 1:21:13Speaker 02

  That tells you a lot about Tom, right? So, so Tom was on me, on me, on me. Trevor introduces me to Hari. Hari comes by the office and we're just having this conversation. And I'm like, okay, this, this guy's a stud. And I said, Hari, if you want to use this as our starting point, like we would do that with you. And he called me a month later, he's like, I've been digging into it, let's go do the same.

• 1:21:33Logan Bartlett?

  And did he, he didn't have a product?

• 1:21:35Speaker 02

  Hari did not, I mean, he had, he was tinkering.

• 1:21:38Logan Bartlett?

  Tinkering, yeah, yeah, yeah.

• 1:21:39Speaker 02

  Kind of thing. I forgot, I don't think he had anything.

• 1:21:41Logan Bartlett?

  And so then you guys buy it for 50 million.

• 1:21:43Speaker 02

  So we buy, I think if you loaded it up with all the equity that we had to give, I think it was 95 or something.

• 1:21:48Logan Bartlett?

  95.

• 1:21:48Speaker 02

  Ultimately, something in that range.

• 1:21:49Logan Bartlett?

  And, and then how did the rest of the business come together and how did it actually turn around? Did they take the same product and just sell it to consumers?

• 1:21:56Speaker 02

  We used the kernel of it and then everything kind of got just built on top of that. I mean, honestly, it turns out with the, look, there's a big benefit of buying something, which is you get to skip the zero to one phase. The bad news about it is that the reason it's being sold to you.

• 1:22:12Logan Bartlett?

  Yeah.

• 1:22:12Speaker 02

  Is because there's, everything else is broken.

• 1:22:14Logan Bartlett?

  Yeah.

• 1:22:15Speaker 02

  And, and in the beginning, we thought we'd like coached, coached whatever the team was into greatness. That doesn't, that doesn't work.

• 1:22:20Logan Bartlett?

  Yeah.

• 1:22:22Speaker 02

  It's a, it's a complete.

• 1:22:24Logan Bartlett?

  Yeah.

• 1:22:24Speaker 02

  Redo of everything. It's, you're building a company.

• 1:22:27Logan Bartlett?

  How many people were there, you think? 100? 200?

• 1:22:30Speaker 02

  Well, probably a couple hundred.

• 1:22:31Speaker 00

  Couple hundred.

• 1:22:31Logan Bartlett?

  And what do you think, like how much turnover? You think it's 50% left or 10% left?

• 1:22:35Speaker 02

  I don't think anybody's there.

• 1:22:36Logan Bartlett?

  Oh, really?

• 1:22:37Speaker 02

  So like 0%. I think it might be zero.

• 1:22:39Logan Bartlett?

  Yeah.

• 1:22:39Speaker 02

  By the way, they were all good people.

• 1:22:40Logan Bartlett?

  No, I'm sure, sure.

• 1:22:41Speaker 02

  I mean, that's just, it just meant like.

• 1:22:42Logan Bartlett?

  You sign up for something that's different than.

• 1:22:43Speaker 02

  We had to reset something. We were trying to create something totally, it was just a starting point for us. It wasn't like we were trying to be in the identity protection business.

• 1:22:49Logan Bartlett?

  Totally.

• 1:22:49Speaker 02

  It was, it was just felt like a great way to really kickstart into this thing. And then, of course, we knew that the first thing to do is stabilize. It took us a couple of years, you know, to, to get the thing to stabilize. I forget exactly where it stabilized, but it, you know, it's definitely below 100 million. And, and then what we did, we did a bunch of crazy stuff with this, which is we took the, you know, what became the growth part, which was tiny, like it's probably a single digit millions. And we took all the non-growth stuff and moved it into something which was much more like a Constellation Software style company, which we called Pango.

• 1:23:17Logan Bartlett?

  Different, different whole co or different?

• 1:23:19Speaker 02

  It's all, it was all together in a sense.

• 1:23:21Logan Bartlett?

  Got it.

• 1:23:21Speaker 02

  But all the strategic, like super innovative, like all the R and D spent, everything like that went into Aura.

• 1:23:28Logan Bartlett?

  Good stuff here.

• 1:23:28Speaker 02

  Yeah, well, not, that's what was good too.

• 1:23:30Logan Bartlett?

  Growth stuff.

• 1:23:31Speaker 02

  Growth stuff, yeah, growth, like what's, what can potentially change the world went into Aura. And what was going to be like our version of a private equity business went into Pango. And then about 18 months ago, Harry, you know, sort of through a personal experience of his, landed on what I think will end up being the biggest play, which is, you know, we're doing phenomenally well in protecting people online. That's growing like really fast now and the unit economics are insane. And like Harry's a stud, so it's all just working.

• 1:24:00Logan Bartlett?

  And roughly like, I mean, whatever you guys can share on scale.

• 1:24:04Speaker 02

  200 million.

• 1:24:04Logan Bartlett?

  200 million.

• 1:24:05Speaker 02

  Or it's 200 million. Pango is much bigger, actually.

• 1:24:06Logan Bartlett?

  Yeah.

• 1:24:07Speaker 02

  Pango's huge, actually. Pango's an awesome business, but it's, anyways, whatever. So we can talk about that.

• 1:24:12Logan Bartlett?

  So Horace is growing super quickly.

• 1:24:13Speaker 02

  Horace is growing really fast. It's got, and about 18 months ago, Harry was thinking like V3 of the product, like what's going to be the next thing. And he had an incident happen in his family where one of his family, one of his children kind of went down, went and kind of took a left turn sort of thing. And he went through her phone and was like, I'm, and he's a very involved parent. He's a great dad. You know, we vacation together. I see it. And he was like, oh my God, all the signals were here. I'm her dad and all the signals were here. I run the fastest growing consumer, you know, online digital protection company in the world, and I had no clue.

• 1:24:51Speaker 02

  And V3 of the product basically became, how do I leverage the data on, that's being, you know, through, you know, like the messages you're sending, the people you're following on Instagram, all the network traffic, all that stuff, to give parents insight into what's happening on their young children's devices that can inform them about how they can parent better. And it's- Without becoming spyware. Yeah, it's not spyware. Exactly. We're not giving you their messages and all that sort of stuff. It's, but it's interpreting the signal. So I'll give you a really simple example. If you have a 12-year-old daughter and she's downloading calorie tracking apps and she's following fitness people on social media and so on and so forth, good chance you have an eating disorder coming your way.

• 1:25:35Speaker 02

  Right now, people don't have a clue. They get blindsided by this stuff. Right? Or let's say your kid is on their device from 1 to 3M every night, and that was not the case a month ago. Like, odds are, not only is their sleep getting disrupted, odds are something has changed in their life and they're, you know, something's wrong. Right? Let's say they're communicating with a whole new set of friends, whether it's text, or WhatsApp, or Discord, or whatever. Probably something has disrupted. You know, if there's suicidal ideation and communication around it, which by the way, like in our beta set of customers, we have 2,500 users that we were beta testing before we announced the product a week ago. I mean, what was the percentage?

• 1:26:06Speaker 00

  I'm gonna read it to you.

• 1:26:07Speaker 02

  It's like 20% or something, some horrifying percentage of kids like 11 to 15 have suicidal ideation that they're communicating to people. And so this, you know, social media's done a lot of great things for the world. But there really, there's a real dark side that we all know logically. The evidence is not, you know, scientific evidence is not, the data sets are not public.

• 1:26:27Speaker 00

  So here are the stats. Forty-six, so 2,500 kids between 12 and 18 years old. So it's pretty significant, okay? Forty-six, 46% of them are depressed. 35% have social withdrawal. 22% are up late night on their device. Um, so sleeping disorder. 30% with low self-esteem. 22% with self-harm slash suicidal thoughts. And 52% with an eating issue. So.

• 1:27:02Speaker 02

  That's our own data. That's not some third-party data. That's the data that we have from our, from our beta users.

• 1:27:06Logan Bartlett?

  But that's based on who they're following and what messages are being sent.

• 1:27:09Speaker 02

  It's a comp, I mean, honestly, we use a lot of, I mean, it's, it's a lot of machine learning, right? There's a tremendous amount of data that funnels in and.

• 1:27:14Speaker 00

  Right. And so rather than actually, as Sujay said, we're not, we're not actually, as a parent, it is giving you, um, knowledge.

• 1:27:26Logan Bartlett?

  Yeah.

• 1:27:26Speaker 00

  Information, insight.

• 1:27:29Speaker 00

  Without actually going into the personalization and and the only time it will surface to you an alert is when there's something that we know is actually harmful.

• 1:27:41Logan Bartlett?

  And I assume there'll be dials or something.

• 1:27:43Speaker 00

  Yes, so if you have a 10 year old.

• 1:27:44Speaker 02

  We built it with Boston Children's Hospital.

• 1:27:46Logan Bartlett?

  Got it.

• 1:27:46Speaker 02

  So all the child psychiatrists there.

• 1:27:48Logan Bartlett?

  Got it.

• 1:27:48Speaker 00

  But but also think of it as a when you have a kid and you're gonna they're they're now about to be able to have get a driver's license, right, was the first thing they have a learner's permit and you have certain things that you need to do and then they go from a learner's permit into a, you know, kid's permit, 16 years old in this and that has certain restrictions around it and you have to have a driver's test and you earn you you're able to mentor your kid into being safe in a car. Well, this is the same thing, you need to mentor, but you can't mentor them if you don't know it. When you grew up, your parents knew three things, where you were, who you were with, and what you were doing, right?

• 1:28:30Speaker 00

  Today, you can have a 13 year old sitting across the table from you and you literally cannot answer those three questions. They may be at that table, it's not where they are. On this device, they've gone to other places in a way that was never, ever, ever possible in this and so parents today, they're drowning, like literally, they're out in the middle of the ocean and they're just trying to stay afloat and they have no tools.

• 1:28:55Speaker 02

  If 50% of parents in surveys will say that when their kid goes to sleep, they go and try to read everything that's happening on their device, like that's the best tool that they have is of course, kids are way too smart for that.

• 1:29:04Speaker 00

  And so this went, so this has gone from actually being a really, really good business and something where, you know, Hari and and Sujay were like, you know, driven to build a great business that was gonna be a fantastic, it's now turned into a mission.

• 1:29:19Logan Bartlett?

  Yeah.

• 1:29:20Speaker 00

  Because we actually feel, you know, as I said, we can be givers here, not takers in this, in which we can actually give parents the wherewithal to. Be great parents and there, as I say, there's not a parent. Do you have kids?

• 1:29:35Logan Bartlett?

  Four, maybe by the time we release this. Yeah, yeah, yeah, yeah.

• 1:29:38Speaker 00

  Yeah, so, but you'll just see when you get to that age there. I was actually at breakfast this morning, someone who's got 11-year-old boy, you know, and she was actually struggling. When I described this and I actually, we could, I showed her what this actually does. It was like, okay, well, how fast can I, I mean, I like, I'm desperate. I need this. And so does every other parent in my, in my group. And honestly, this happens three times a day, every day for every one of us in it. And so we, we actually just launched the product two weeks ago. It's got a whole bunch of features and functions that come out over the next, call it four to six months, when it will be a sort of full.

• 1:30:13Logan Bartlett?

  Are you guys, you're gating signups or people, can anyone go and sign up right now?

• 1:30:18Speaker 02

  We've made it so you're, it's slow to start.

• 1:30:21Logan Bartlett?

  Yeah, I got it.

• 1:30:22Speaker 02

  Because we want to just really nail it.

• 1:30:23Logan Bartlett?

  Yeah, measure.

• 1:30:24Speaker 02

  And as Jeffrey said, we've got a handful of things that we think are required before it's perfect.

• 1:30:28Logan Bartlett?

  Yeah.

• 1:30:28Speaker 02

  Four to, well, you're never perfect, but you know what I mean? Four to six months.

• 1:30:31Logan Bartlett?

  Well, and all these things are trade-offs. We were talking about the privacy side of things, but like, like anything else in the world, there's, you know, with, with freedom comes other considerations in all of this. You get a phone, you get the ability to go.

• 1:30:43Speaker 00

  Start with a 10 or 11-year-old, which is the conversation I had this morning. I said, listen, you're about to give, or you've given your son a device that's cost you somewhere between $500 and $1,000.

• 1:30:53Logan Bartlett?

  By the time we really said, it'll be six, $7,000.

• 1:30:56Speaker 00

  Well, next week. And the planes that had taken off maybe, or landed, they're okay. The, you know, $50 a month for various subscriptions and things that are on this. And so at 11 years old, I'm okay with you having it, but just be, understand that in return for that, I am going to have observational and controls. And so in an 11-year-old, you're not going to let them go on to sites and places that you know they are not, they should not be on at their age. So there's very specific features and functions and controls that you can determine how long, what time of day.

• 1:31:35Speaker 00

  And so every parent, um, the beauty of the product is, is that each parent can make that choice with their kid about what level of control and the controls on the 11-year-old versus a 17 or an 18-year-old. It'll not look anything like that. Right? And so.

• 1:31:53Speaker 02

  And also the way the parental controls model works here, for, I mean, there's a lot of different areas, like, like. Functional aspects here, but one of them is fine-grained parental controls where you can basically set timers for various apps and then the kid has to come to you and say, hey, listen, I'm working on my school project. I really need YouTube for another hour and you can decide whether to give it to them or not. But it allows you as a parent to actually finally have some constraints. I mean, you'll see this when your next, when your child turns like three, they can watch slime videos on YouTube.

• 1:32:22Logan Bartlett?

  Forever.

• 1:32:22Speaker 02

  For eight hours.

• 1:32:23Logan Bartlett?

  Yeah.

• 1:32:23Speaker 02

  Like it's, it's the most bizarre thing. I have three little kids. I mean, it's the most bizarre thing I've ever seen in my entire life. They love watching humans play with slime.

• 1:32:33Speaker 00

  So, but so here's the thing, which is go back to your thing, which is this is only possible today because of machine learning and AI. It was not, we couldn't have done this three years ago.

• 1:32:45Logan Bartlett?

  You could do it with a sledgehammer, but not in a fine-grained way.

• 1:32:48Speaker 00

  Not in a way that would be, the kids would buy into it, the parents would buy into it. And so that, you know, this is where one of the amazing benefits that are going to, to, to come out of it. And for, you know, we, we actually feel like we're on a mission right now that if we can deliver the promise of what this is, the impact of this will be just beyond anything certainly I've ever done in my career. And I think that's saying something.

• 1:33:16Speaker 02

  What's the, um, so the funding history of the company? So it came together with?

• 1:33:20Speaker 00

  You don't want to hear about dog grooming. No, I don't know. We can get to that. We might.

• 1:33:25Speaker 02

  This is a little more on topic. So, so the funding history here, so we put money in, uh, I don't remember exactly. It's, uh, this one was early 2019 as when we finally got the deal done, uh, the first one. And then we did it, um, I forgot how much General Catalyst invested, but Trevor's been with us since the get-go. And then, um, I mean, there's been a bunch of, it's been a journey. Uh, and so Excel's, the cap table's basically, I was saying where it's at. It's hard to remember the exact history of it, but, uh, it's us, General Catalyst, Warbur pinkus, Excel. Um, and, uh, and then more recently, uh, 1011 Ventures and Madrone came in.

• 1:34:09Speaker 02

  And but then we have other ones, right? Like we, you know, we, you know, we own the largest mobile VPN in the world. 350 million downloads last year. We own 65% of it. The CEO used to run engineering for me at another company and he's an absolute animal. And so, no, what happened was there was a, there was a founder in Singapore that had created this product. Now, we, we've just got to know the space so well that we basically approached, and they hadn't done a bit as a person with a, with a product. And we said, listen, are you interested in selling that product? And we built a company around it. And so he didn't invent the product, but it would, I mean, it was, you know, when we bought it, it was tiny. And now it's, I mean, I think it's probably 65 million of revenue and 30, 30 of EBITDA now. And we bought it for 20 million bucks. No.

• 1:34:54Logan Bartlett?

  These are all, I mean, these are all creative deals in some ways. Like, is that, as you sort of, what bucket does this go into? Are these incub, these are builds?

• 1:35:04Speaker 02

  Because the company, they wouldn't exist.

• 1:35:05Logan Bartlett?

  They wouldn't exist otherwise, that's it.

• 1:35:07Speaker 02

  And we're, and we know them cold.

• 1:35:08Logan Bartlett?

  Yeah.

• 1:35:09Speaker 02

  Like, like we, like.

• 1:35:10Logan Bartlett?

  You are an executive of the management team. This is.

• 1:35:12Speaker 02

  Like, there's, there's not much that we're particularly good at, but the things that we do builds in are things that we have confidence in ourselves that we're really good at.

• 1:35:21Speaker 00

  I always have this line, which is, is that, you know, I know something about everything and everything about very little.

• 1:35:28Logan Bartlett?

  Yeah.

• 1:35:28Speaker 00

  In the builds, we stick to the things that we.

• 1:35:30Logan Bartlett?

  You stay within the, in the line, the fairway.

• 1:35:32Speaker 00

  The ones that, the few that we know a lot about.

• 1:35:36Speaker 02

  Yeah. We're confident when we do them.

• 1:35:37Logan Bartlett?

  Yeah. Now, I guess, as we wrap, so are you still having fun doing this?

• 1:35:47Speaker 00

  Here's what I will say to you. He's heard this, which was sort of my, and I really.

• 1:35:50Logan Bartlett?

  I assume he's heard all of this in some way, shape or form.

• 1:35:52Speaker 00

  But I, but it's, I found these words a few years, maybe a year or two ago, and they actually are every day.

• 1:36:00Speaker 00

  Which is never let your memories be better than your dreams.

• 1:36:03Logan Bartlett?

  I actually, that was gonna be my second question was asking about that quote here. I, I never, I actually didn't ask a single question in my sheet. I have, I have like 12 pages of notes or something.

• 1:36:13Speaker 00

  So I don't, I don't actually know who originally said it. I went first and I couldn't actually find attribution of it. I thought maybe, maybe I should just take attribution.

• 1:36:23Logan Bartlett?

  I was gonna say.

• 1:36:23Speaker 00

  But I come from Hollywood and that's a mistake.

• 1:36:27Logan Bartlett?

  Yeah, I'll come back to my shit somewhere.

• 1:36:29Speaker 00

  Someone will go, no, you did not. I did not, but I've, I didn't create it, but I own it.

• 1:36:35Logan Bartlett?

  Yeah.

• 1:36:36Speaker 00

  And that every day, I really do feel it. I just like, it couldn't be more exciting. I learned so much, literally every day. There are things that I never knew, I didn't understand. I'm, I'm, I have a great teacher here, I have great teachers in my partners. It's super exciting and it's hard for people. And he always says this, says, well, that's great, but you know, you know, how about making Top Gun? And I go, nah, it was great, but that's back and I don't wanna make, you know, I did that.

• 1:37:07Logan Bartlett?

  Yeah.

• 1:37:08Speaker 00

  Did hundreds of those, literally, and most of them were bombs, by the way. So we were not.

• 1:37:14Speaker 00

  Not many of them were like that, but so, you know, doing, I find that the creating and the building of the companies today and the fact that this is all new for me is just incredibly energizing. And, and yes, it's just wildly fun.

• 1:37:32Logan Bartlett?

  Well, you guys have a great partnership dynamic. I, I can see between how you guys work together and how you balance and all that.

• 1:37:38Speaker 02

  You know, it's funny, it just reminded me of this conversation I had with a friend. Like, so someone was asking, like, when Jeffrey and you, when we finally decided to get Wonderco going, I told you, it was like a few months of like dating or whatever you call it. Like, I was really struggling with the idea of this thing, which was worth zero, this, this idea, cutting it in half. I was like, I was like, why would I give half my company, which didn't exist, away? You know, that was like kinda in my head. And Jeffrey looks at me and he's like. What's your problem? I'm 65 years old. This is gonna be your fucking thing in 10 years anyways. And literally, I was telling this, I was telling this story to a friend of mine the other day. I was like, and the reason I was telling you this, I was like, literally, my worst fear would be if Jeffrey decided to not do this anymore because he is the magic. For one year. You know, it's like, it's like, and so it's like, it's like this thing that's just so funny about life, right?

• 1:38:22Speaker 02

  Which is, you meet people, very rarely like him, who have qualities that you literally don't see in anybody else. Like, I ran into this, um, I don't wanna name drop, but like this very famous movie star yesterday, who I know through Jeffrey. And he was asking how Jeffrey was doing and this and that. And I said, listen, like, Jeffrey's a maniac. He's, if he's got 20 minutes of free time, he's gonna spend that free time figuring out how to schedule something. To schedule his next Tuesday, cuz he doesn't wanna waste 20 minutes of his day. Whereas for, and you know, we, he and I, the other guy and I were joking, we're like, well, we need to start the morning, get a cup of coffee, you know, it's just, Jeffrey is a very, he's like a once in my lifetime at least kinda person to be around. And that's what makes life fun, right?

• 1:39:06Speaker 02

  To get to work with someone who you like, are just mesmerized, you know, you're just mesmerized by the habits and the practices and the, and the kinda the ideas and all that sort of stuff. It's cool, and, you know, it's, it's different with each of the people we get to work with, but that's what makes a partnership, that's what makes partnership fun, right? That's the point of it. Otherwise, you're spending all your time attributing like, who did what deal? And how much credit do I deserve for that? And how are we splitting up the economics based on this or that? And what a horrible way to spend your time. You know, it's so much more fun to just partner on figuring out what crazy stuff are we gonna do together? Does it have a chance to change the world? When it doesn't work, we all roll up our sleeves. Don't get me wrong, you can get tense at moments because that's the nature of doing hard things.

• 1:39:46Speaker 02

  But at the end of the day, there's this foundation of trust and love and like a commitment to like trying to do something together. That's really, really fun.

• 1:39:54Logan Bartlett?

  It's a good place to end. Thank you guys for doing this. A lot of fun.

• 1:39:57Speaker 02

  No, it's great to meet you. Appreciate it.

• 1:39:58Logan Bartlett?

  Thank you.

• 1:42:04Speaker 02

  The.

• 1:44:14Speaker 02

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• 1:46:24Speaker 02

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• 1:48:34Speaker 02

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