20VC: Bryan Johnson @ OS Fund & Braintree on Investing In The Operating Systems Of Life & Why VC Should All Be Open Source

Bryan Johnson is an entrepreneur and investor. He is the founder of OS Fund and Braintree, the latter of which was bought by eBay in 2013 for $800 million in cash. Bryan launched OS Fund in 2014 with $100 million of his personal capital to support inventors and scientists who aim to benefit humanity. His investments include endeavors to extend healthy human life to 100+ (Human Longevity), replicate the human visual cortex (Vicarious), mine an asteroid (Planetary Resources), reinvent transportation (Matternet), and reimagine food (Hampton Creek), among others. A special thank you to Mattermark for providing all the data displayed in today's show and you can find out more about Mattermark here! In Today's Episode You Will Learn: 1.) How Bryan made his start in the world of tech and how he has come to the OS fund today? 2.) What was the pivotal moment in Bryan's career? When was the turning point? What was was the hardest part of the entrepreneurial journey and how did Bryan conquer it? 3.) What is the main motivation behind the OS fund? Which areas does Bryan most want to solve and where does he see significant market opportunities? 4.) Does the longevity of return to Bryan's exits concern him? Most investments exit with 10 years, human lifespan startups take a little longer! What sort of time frame does Bryan have in mind when investing in these companies? 5.) What does Bryan really perceive synthetic biology to mean? Are we seeing improvements in this sector? 6.) The OS Fund have recently released a white paper detailing extensively their process for investing? Why did Bryan decide on this open source style of investing? 7.) What would Bryan like to see more of? Where does Bryan see a lot of people investing that he thinks is a mistake? Items Mentioned In Today's Episode: Bryan's Fave Book: Endurance: Shackleton’s Incredible Voyage to the Antarctic Bryan's Most Recent Investment: Ginkgo Bioworks As always you can follow The Twenty Minute VC, Harry and Bryan on Twitter here! If you would like to see a more colourful side to Harry with many a mojito session, you can follow him on Instagram here!

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

• 0:00Harry Stebbings?

  Hello and welcome to the 20 Minute VC with your host Harry Stebbings and we have another incredibly special week on the show for you. Some amazing guests lined up. Kicking it off for us today is a personal hero of mine. Having heard his amazing story on the Tim Ferriss Show, I felt I had to have him on the 20 Minute VC. The only trouble is, is he a founder or is he an investor? I'll leave that one for you to decide. But joining me today is Brian Johnson, the founder of OS Fund and Braintree, the latter of which was bought by eBay in 2013 for $800 million in cash. Brian launched OS Fund following that in 2014 with $100 million of his personal capital

• 0:40Harry Stebbings?

  to support inventors and scientists who aim to benefit humanity by rewriting the operating systems of life. In other words, he fuels real-world mad scientists. His investments include endeavours to cure age-related diseases and extend healthy human life to 100-plus years with human longevity. He plans to replicate the human visual cortex using artificial intelligence with Vicarious, and he even wants to mine asteroids with planetary resources. But before we dive into the show today with Brian, I want to hear what you think of the show. What do you like? What don't you like? So send all your feedback to [email protected], all in letters.

• 1:23Harry Stebbings?

  And I'd also like to say a special thank you to Mattermark for providing all the data for today's show. So awesome. And if you're like me, always looking for more startup and VC articles, then do sign up to the daily curated Mattermark Daily by the legend that is Nick Frost, who can be found on Twitter @thinker. But without further ado, it's time to welcome the man himself. Therefore, I'm thrilled to introduce Brian Johnson, founder at OS Fund and Braintree.

• 1:57Harry Stebbings?

  You have now arrived at your destination. Brian, I'm so excited to have you on the show. I was massively fascinated when I heard you on my favorite Tim Ferriss's show and then more recently with Jason's This Week in Startups. Thank you so much for joining us today.

• 2:12Speaker 01

  Yeah, thank you for having me.

• 2:13Harry Stebbings?

  Now, can you get the ball rolling by telling us a little snapshot of yourself and how you've come to where you are today with the OS Fund?

• 2:20Speaker 01

  Yeah, I guess it started when I was twenty-one. I'd just returned to the US after being in Ecuador for two years, living among extreme poverty. And I came back to the US with this burning desire to spend my life trying to improve people's lives. I mean, seeing how these people lived and they definitely didn't get a shot at life to do the things they really wanted to do. So I thought, you know, I'll become an entrepreneur, I'll make an enormous amount of money, I'll retire by thirty, and then I'll spend the rest of my life trying to add value to the world. I didn't know what it meant at the time. I just knew that if I had freedom of time and abundance of resources, I could hopefully do something some good. And so I spent the next thirteen years building companies. Some succeeded, some failed.

• 2:59Speaker 01

  I spent during that time a lot of, spent a lot of time reading science and technology and trying to figure out where the human race was going. And I came to like this one realization that changed my outlook and my understanding forever, my relationship with the universe is that I think that the uniqueness of our time and place is that we can literally program our existence. If you consider tools like biology and genomics, 3D printing, robotics, virtual reality, artificial intelligence, we can literally program anything. And that was, that has been true in previous generations. And with these tools of creation, the most pressing question in my mind became, what kind of world are we going to build? And so when Braintree got acquired and I now have that freedom of time and abundance of resources,

• 3:44Speaker 01

  I started the OS Fund to invest in these tools of creation, these technologies that would define our existence over the coming decades and centuries.

• 3:52Harry Stebbings?

  And then what would you say was the pivotal moment for you then, that transition moment in your career when it really catapults it?

• 3:59Speaker 01

  So I think it was probably the building of up Braintree. We, we were in the right place at the right time with the right product and the right team. And with my previous companies, I just didn't have that. Everything came together and we were able to build, I think, something really exceptional. And with the exit, it gave me for the first time, freedom of time and and um re and you know, a lot of resources, which I never had before. At that point, I could I could literally choose to do anything I wanted. I didn't. There was no more. Uh what I what I must do is a question of what can I do now that I have nothing that I must do?

• 4:32Harry Stebbings?

  Did you ever think about pursuing another entrepreneurial venture?

• 4:35Speaker 01

  Oh, of course, it's always it's always in the back of my mind. I think um I still may. Because I I do love being in the trenches. I love building. I do have some things I'd like to a a few problems I'd like I'd like to see solved.

• 4:48Harry Stebbings?

  What what are one of those problems that you'd like to see solved then?

• 4:52Speaker 01

  There's four general areas I I have an interest in. One is intelligence. That I think that for the human race to be able to adapt to circumstances that we'll we'll encounter. We need to maintain adaptability. And I think if if we can achieve. Intelligence that allows us to adapt quicker and faster to uh circumstances, I think it's better. So we achieve intelligence through artificial intelligence, but also through. Our own cognitive enhancement. So human cognition enhancement is an area. Two is ideological systems, anything that any belief and value system that compels humans to behave behave a certain way. So it could be capitalism, it could be governance, it could be religious. Anything that creates a framework for us to have motivations and aspirations.

• 5:37Speaker 01

  And yeah, I think along the lines, if you if you consider like what what is a a child grow up today aspiring to be? What do they aspire to do? And what do they think is possible? And if you put that in the context of tools of creation that we can literally program anything. Do they understand that? And so uh I'm interested in in helping children understand the power of these possibilities. Uh three.

• 5:58Harry Stebbings?

  So is that through is that through ed tech?

• 6:01Speaker 01

  Well, so I I wrote a children's book and I'm currently writing a second one. And next year, we're starting or launching an endeavor focused on children.

• 6:10Harry Stebbings?

  Okay.

• 6:10Speaker 01

  And it the idea again is to I want to reorient the identity and aspirations of of children, that they understand we have these tools of creation that can be used. And they can endeavor to do really important, meaningful things in their life. So what what is important and meaningful is not something I superimpose on them. It's not, doesn't have to necessarily be science, right? It could be art. Or it could be anything. Um but they understand they have this capability to do it. And so we want to make a specific effort on this. To have children grow up with a specific. Uh, option to have beliefs and values that align with your building humanity in a way that is favorable for everyone.

• 6:46Harry Stebbings?

  Uh, and three?

• 6:48Speaker 01

  Uh, governance systems. So how we cooperate. So the US government is a very important player in the world. In terms of how we develop technology here in the US, but also abroad. The same is true for everyone else's government. And the key question of how we cooperate, how we make decisions, how we reconcile our differences, how we allocate resources. Is central to how we're going to actually build these technologies and, and build uh, the kind of world we want. And I think that there's a lot of room for us to improve our governmental systems. And then fourth, I jumped the gun, but it's basically the children's effort. And so um, intelligence ideologies, governance systems, and the children's efforts.

• 7:28Harry Stebbings?

  You're looking to solve these problems through the OS fund, which invests in these categories. So what, what, uh, the main motivation behind the OS fund is altruistic with a mixture of uh, return based? Or where, where do your balances lie with return, with returns and balancing that with social impact?

• 7:47Speaker 01

  Sure, I mean, uh, money is a, a tool of power and influence, right? I can do things with money that I could otherwise do. I can invest in companies and I can hire people and they can buy equipment and they can do certain things. And so it doesn't do me a whole lot of good if I use that tool to make it less powerful by, by giving it away. So at this point in my life, I've decided to use uh, to pursue capitalistic models where I can invest in something, it can make money. And it can also return a greater sum to me. And that increases my ability to continually do, to do efforts that I believe would accomplish favorable outcomes for humanity.

• 8:22Harry Stebbings?

  And as a new, as a newly turned uh, VC, who would you say you look up to then in the investing world and hope to emulate?

• 8:30Speaker 01

  It's been interesting. We, there's a different culture that we've found in investing. Particularly science-based companies that are trying to bring about these outcomes. I found it to be less competitive and less cutthroat than say, for example, you find the behavior in investing in a particular app or software company. Where you have dozens and dozens of companies that could are viable capital sources. There's usually less, there's fewer people willing to invest in these hard science endeavors. And so I have found it to be cooperative and helpful and collaborative. And we're trying to sincerely get these companies to work because they just don't have very many options for good funding sources.

• 9:09Harry Stebbings?

  And why do you think there are fewer investors then in this field? Is it the longevity of return?

• 9:15Speaker 01

  I think there's a couple of challenges. One is I think most of the wealth in the world is maintained or managed by people who don't have scientific expertise like myself. And so it makes more sense to invest in things that you do have familiarity with, like the internet or software or real estate or transportation. And so I think it's, I mean, if you don't have scientific expertise, it's pretty intimidating when someone throws down a plan to do stem cell research or something, you know?

• 9:38Harry Stebbings?

  Absolutely, yeah.

• 9:39Speaker 01

  And then number two, I think what you mentioned before is true, that there is this perception that it's longer time horizons, that there's a lot more uncertainty, a lot more could go wrong. It's harder to to to understand the intricacies of the scientific endeavor. This is why we open source our playbook is that this is the question I ask myself is how do I, as a non-scientist, invest in scientific endeavors in a way that would be successful? And we conclude that one, that one of the biggest challenges in making decisions is our decision-making process. So we used, we went and analyzed a number of different decision-making processes for big farm and big oil,

• 10:19Speaker 01

  how they actually gather data, process data and make decisions. So we used decision analysis and created a model that helped guide us through what questions to ask, what areas to dig into, what data to process and how to make a decision on the end. And our theory was that if we could create this model of decision-making and share it with the community, that others would feel more comfortable coming into the world of science. They could better understand the risks and the potential rewards of the investing.

• 10:46Harry Stebbings?

  And so in the long term, how do you see the investing attitude changing towards investments in science and kind of deep technical science like synthetic biology? Do you think we'll get more consumerized?

• 10:59Speaker 01

  I do. I think it will in the in the coming years. I think that efforts like what we've done to playbook of trying to make it more accessible will be helpful and others are doing uh some similar things.

• 11:10Harry Stebbings?

  Is that is that becoming common, open sourcing DD processes?

• 11:14Speaker 01

  So, um.

• 11:15Harry Stebbings?

  Cause you you O O S funds was the first that I've seen that's done it in kind of extensive uh generous detail. I mean, you know, as you say, it's a playbook and it's quite rare for investors to give out a playbook. Is that, do you think will move towards that as an investing community?

• 11:31Speaker 01

  I think more people will be interested in solving larger, more complex problems. I think that, I mean, for example, if you look at what people are doing, those who have made an enormous amount of money in the world. And now have the option to do whatever they want. If you consider what kind of endeavors they're pursuing, a lot of them are around trying to create breakthrough scientific endeavors that would benefit the world. I think that if you look at the underlying motivations of of why people do this, I mean, there's social cues of like what's, how do you achieve status? What's cool? What's important? What what's meaningful? I think these things are good motivators to get people to to join and do these kind of things. I think there's a tailwind on people wanting to do things that impact the world in a positive way.

• 12:15Speaker 01

  And I so I do think that in the coming years it will become more accessible because more and more people will be trying to figure out how to break down the barriers for what makes it really hard today.

• 12:23Harry Stebbings?

  And do you think your entrepreneurial and your your Mormon past, has it i impacted your investing approach and attitude?

• 12:30Speaker 01

  I'm sure in some ways because I it's uh it was so embedded in me for so long. Um I don't know specifically what I would say, but I I do think that I I grew was raised to work hard. And to be thoughtful and to try to be generous in communities. So I do think that that there's a lot of positive things that was gained from the culture as I've grown up.

• 12:50Harry Stebbings?

  And then going back to we said about the longevity of return for investments, do you have a timeframe in mind when you invest in the companies?

• 12:57Speaker 01

  Yeah, I really don't. Uh it's um my benchmark of is the goal is to benefit the lives of billions of people for generations to come is to rewrite the major operating systems of our society. And so if a company can do that and they can make money doing it, then I don't really care what the time horizon is.

• 13:16Harry Stebbings?

  Okay.

• 13:16Speaker 01

  So the return needs to be there, of course, uh to make it worthwhile for the capital investment. But no, I don't care. Uh it's a few decades.

• 13:23Harry Stebbings?

  And when you look at your portfolio now, what would you like to see more of? Where are there gaps in your eyes?

• 13:29Speaker 01

  One area that I love is material science, the rearranging of atoms. Um I think it could have broad implications on our ecosystem of input of of raw source inputs of how we distribute goods and services, how we consume them. And we've just started to dabble into it. We haven't made a specific focus. We've been mostly in synthetic biology and genomics, done some space and A I. But material science is an area that's very interesting to us.

• 13:54Harry Stebbings?

  And do you have a a C T O almost who does all the scientific D D for you or do you engage in that yourself?

• 14:02Speaker 01

  So I do engage in it myself, but we also have a broad network of experts. So it depends on which area we're looking at. So we oftentimes on it. If, for example, we're looking at a synthetic biology company, we'll bring in four or five experts. Uh they'll range from biology to computation to physics. And we'll do an interdisciplinary team approach to try to find a understanding that we have.

• 14:21Harry Stebbings?

  And so they advise us to the fund then?

• 14:23Speaker 01

  Yeah.

• 14:24Harry Stebbings?

  Yeah. And so how many, how many are in the fund now? How many do you have working for you?

• 14:29Speaker 01

  Uh there's probably a ten or so of us.

• 14:31Harry Stebbings?

  And then where do you see a lot of people investing that you maybe think is a mistake or think uh is not the most profitable route?

• 14:38Speaker 01

  You know, I think there's always opportunities everywhere. It's just the matter how it's structured.

• 14:43Harry Stebbings?

  Well, what are your thoughts on Bitcoin?

• 14:45Speaker 01

  I love it. It's a fantastic technology. It's that, I mean, I guess I I kind of think of it like, I mean, the blockchain technology, I kind of think of it like the printing press where when we figured out how we could, someone could write words and it could be printed and broadly distributed to humanity. And someone says, if someone were to ask, you know, what is this going to mean to the world? It would have been hard to say, right? The Mein Kampf was going to be printed. And the Bible broadly distributed, broadly distributed and every, every other idea we have in print. And I think the same thing is true as like things like blockchain or genomics or biology. What we create with these tools of creation, these platforms of creation is just very hard to predict. Because once they get out there and the creative minds get to work on it, anything's possible.

• 15:25Harry Stebbings?

  And then, when we go back to the investing, do you have any co-investors that you traditionally like to go in with? Do you have any kind of preferred V C funds that you partner with?

• 15:35Speaker 01

  Yeah, we, um, saw quite a few, like we like D C, V C, Founders Fund, Lux Capital. There's like, there's probably like a dozen or so we love that we love working with, again, are just are great people, good processes, smart minds and very collaborative.

• 15:49Harry Stebbings?

  And then, if it's okay with you, we're gonna dive into a quickfire round now, where I say a word or statement and you give me your immediate thoughts.

• 15:56Speaker 01

  Okay.

• 15:57Harry Stebbings?

  So your favourite book and why?

• 15:58Speaker 01

  Uh, Shackleton, uh, Endurance Voyage, because it demonstrates the unbelievable tenaciousness of a group to overcome challenges.

• 16:07Harry Stebbings?

  Absolutely, amazing, amazing book. I read it actually after Peter Sathy, Man at Digital Media, uh, recommended it to me. Uh, what's the best piece of advice you've ever been given?

• 16:17Speaker 01

  It's on my mother's fridge. Life is not waiting for the storm to pass, it's dancing in the rain.

• 16:23Harry Stebbings?

  The most read blog or newsletter for you?

• 16:25Speaker 01

  I don't have one, I like to dance around.

• 16:28Harry Stebbings?

  Likes to dance around. Do you have any kind of preferred reading in terms of newspapers?

• 16:32Speaker 01

  No, it just depends on what information I'm after at the moment.

• 16:35Harry Stebbings?

  Okay, and then most use apps on your phone?

• 16:39Speaker 01

  Pandora and Spotify.

• 16:41Harry Stebbings?

  Okay, uh, balancing social impact with investor returns, does one take priority?

• 16:47Speaker 01

  No, both are achievable.

• 16:49Harry Stebbings?

  Who is the thought leader in the industry to you?

• 16:51Speaker 01

  Uh, uh, in finance?

• 16:53Harry Stebbings?

  In, in, it could be in science, it could be in V C.

• 16:58Speaker 01

  Uh, Craig Venture, he's a visionary that can execute on extremely hard problems.

• 17:05Harry Stebbings?

  And then finally, your most recent investment and why you said yes?

• 17:09Speaker 01

  Ginkgo Bioworks, because.

• 17:12Speaker 01

  They are making biology a predictable programming language, which will radically transform planet Earth.

• 17:20Harry Stebbings?

  Well, Brian, thank you so much for coming on the show. It's been an absolute pleasure chatting to you.

• 17:24Speaker 01

  Cool. Well, I'd love to hear any feedback. I always want to get better and speak to, um, what's relevant and get better at this. So you have a good interview style. I like it. It's very, very soft and easy and just flows well.

• 17:37Harry Stebbings?

  What a charmer Brian is and absolutely fantastic to have him on the show and hear his incredible story. And if you're enjoying the 20 minute VC, then please do sign up for our newsletter on the 20minutevc.com, all in letters. So you never have to miss an episode or an update. Likewise, remember what I said at the beginning, I would love to hear your feedback. So send me any positive or negative thoughts. I'd love to hear how we can make the show better for you. And you can email me at harry at the 20minutevc.com, all in letters again. Thank you so much and we look so forward to bringing you next episode on Wednesday.