20VC: Leadership Lessons from Bill Gates and Steve Ballmer, The Early Days of TheFacebook Advising Mark Zuckerberg and Why Now is Not the Right Time For Startups to Stockpile Cash with Hadi Partovi, CEO @ Code.org

Hadi Partovi is a tech entrepreneur and investor, and CEO of the education nonprofit Code.org. Before founding Code.org, Hadi founded two prior startups: Tellme Networks (acquired by Microsoft, discussed on 20VC with Emil Michael), and iLike (acquired by Newscorp). Hadi has also been an active advisor and angel investor to some of the best including Facebook, Dropbox, airbnb, and Uber. If that was not enough, Hadi currently serves on the Board of Directors of Axon and MNTN. In Today's Episode with Hadi Partovi: 1.) From the Iran-Iraq War to Founding Startups: How Hadi and his family made their way from war-torn Tehran to the US and Silicon Valley? How did seeing his family have nothing and struggle financially impact Hadi's mindset as an entrepreneur? What does Hadi believe he is running from? What is he running toward? 2.) Lessons from Ballmer and Zuckerberg: How did Hadi first come to meet a young Mark Zuckerberg when TheFacebook had less than 10 employees? Why did Hadi believe he was so special from that first meeting? What are Hadi's biggest takeaways from working with Steve Ballmer? How did the reign and leadership of Ballmer compare to the reign of Bill Gates? Hadi has helped both Facebook and Dropbox with their engineering hires, what is the secret to hiring amazing engineers? How does he structure the process? Where do so many go wrong? 3.) Hadi Partovi: The Leader: How does Hadi define "high performance" in leadership? How has it changed with time? What is Hadi's framework for making tough decisions? How does Hadi teach that framework to his team? What are the biggest mistakes leaders make in decision-making? How important does Hadi believe speed of execution is? How does Hadi determine when is the right time to go slow to go fast? 4.) Hadi Partovi: The Person: How does Hadi analyze his relationship with money today? How does it change over time? Hadi stepped off the for-profit treadmill with Code.org, why did he make that decision? How does he avoid the trappings of chasing wealth? How does Hadi think about ego and ego management today? How does Hadi separate self-worth from financial gain and accomplishment? Items Mentioned in Today's Episode: Hadi's Favourite Book: Sapiens: The #1 bestselling journey through human history and anthropology

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

• 0:00Speaker 00

  In a world where interest rates are zero or even negative, nobody was overweight. When suddenly interest rates go up and there's inflation, instantly when that changes, people needed to think our approach to spending is for a world that no longer exists.

• 0:13Harry Stebbings?

  Welcome back to 20 VC with me, Harry Stebbings. And for me, storytelling is a passion and so is learning from some of the grace in our industry. And I'm so excited today to have both in spades in this episode with our incredible guest, Hardy Partovi, a tech entrepreneur and investor, and now CEO of the education nonprofit Code.org. Before founding Code.org, Hardy founded two prior startups, TellMe Networks, which we did an incredible feature on in our episode with Emil Michael, and then also I Like, which was acquired by News Corp. Hardy's also been an active advisor and angel investor to some of the best, including Facebook, Dropbox, Airbnb, and Uber. And if that wasn't enough, Hardy also currently serves on the board of directors of Axon and MNTN. And I want to say a huge thank you to Alfred Linnet Segoya and Jeff Wilkie,

• 0:56Harry Stebbings?

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• 1:38Harry Stebbings?

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• 2:10Harry Stebbings?

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• 2:53Harry Stebbings?

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• 3:35Harry Stebbings?

  But that is enough from me, so now I'm so excited to hand over to the one and only Hardy Potovi, CEO at Code.org.

• 3:47Speaker 02

  You have now arrived at your destination.

• 3:50Harry Stebbings?

  Hardy, I'm so excited for this. I spoke to Alfred Lin, I spoke to your brother, I spoke to Emil Michael, I spoke to many others, so thank you so much for joining me today.

• 3:59Speaker 00

  Thank you for inviting me. It's a pleasure to be here. And thank you for all the folks you talked to and the research you did before us talking.

• 4:04Harry Stebbings?

  But I want to start with a fantastic start being, how did you make your way into the world of startups first? And then most recently, skipping a few steps, how did you come to foundcode.org?

• 4:15Speaker 00

  These are somewhat linked. I got into the world of startups first, honestly, starting my own. Or watching my brother start Link Exchange when we were twenty two or so. He quit the big company job to start Link Exchange with Tony Hsieh and Sanjay Madan. And Alfred Lin joined that startup then. And when I was twenty six, I think I quit Microsoft to start my own startup, Tell Me Networks, with my former enemies from Netscape. So I'd always had entrepreneurship in me. But really, it was when I turned thirty that I began investing in startups, advising startups, shifting into more angel investing. The reason I started Code.org is after a decade of working in tech myself and a decade of investing in companies, I realized every single company struggles with the challenge of hiring great talent. And it's not that there's not smart people in the world.

• 5:00Speaker 00

  It's that our school system isn't teaching the right courses to prepare people for a future of technology. And so I started Code.org with the idea of changing the curriculum of schools globally so that education better prepares people for a future that's really being invented through technology and software.

• 5:14Harry Stebbings?

  So we're going to get to kind of the reimagining of education. I do want to ask, in terms of kind of your education and the makings of Hadi, I believe we're all functions of our histories. When you look back, what are you running from first? And then, looking forward, what do you think you're running towards, Hadi?

• 5:29Speaker 00

  Oh, my God, that is a deep question. But I look back and what am I running from? I grew up in Tehran, Iran. My early childhood, from when I was six years old, was a childhood of revolution and war, the morality police, worrying about my mother getting arrested just for any random thing, worrying about bombs destroying our household. Every night, we were in the basement while the neighborhood was getting bombed. And then, when we came to the United States, our family as immigrants were poor. We couldn't afford a home. My mom and dad and my brother and I shared one. And the earliest thoughts I can think of when I was twelve or thirteen or fifteen was, I just wanted the money to afford a house or to have vacations that weren't driving a hundred miles to rent a cheap motel room. And so having financial security was a strong motivator. And escaping that path was what I was running away from.

• 6:14Speaker 00

  And what I'm running towards now at this point in my life? I've had an incredible life, starting from where I started to now be at the point to have invested in some of the greatest companies created on earth. I stand now as an embodiment of the American dream, this idea that if you work hard and you work smart, you can achieve anything. You want, but I feel like the American dream is broken and not everybody has that access. And what I'm running towards is really creating a world where that American dream works for everybody. Where this idea of opportunity is truly available to everybody. The work that I'm doing in code.org is to fix something that's wrong in the opportunity system in our country and in our world.

• 6:48Harry Stebbings?

  Blundy, do you feel the lack of resources early on in your life and lack of money, to be clear? Do you feel that gave you a drive and a grit that you otherwise wouldn't have had?

• 6:56Speaker 00

  Absolutely. Growing up with a poor family gave me grit and hunger and ambition. And what's interesting is I came from a family that had a lot of money before the Iranian revolution. Back in Iran, my grandparents and their brothers, they were all the equivalent of billionaires in a different currency in a different time. I didn't know that because I was like four years old. So it wasn't just that we grew up without money. We grew up without money because it was taken away from us. And when you have your money taken away from your family by the government and you know that all of your grandparents were entrepreneurs and business people. It has the sense of not just I wanted to succeed, but I almost felt like taking something back or writing an injustice that had happened.

• 7:35Harry Stebbings?

  I totally get you. Many people have said on the show about actually Parker Conrad at Rippling that vengeance is what makes him special. Totally agree with you and get you there. I did speak to Emil Michael before and he said, you've got to ask about selling Tell Me. It was a big moment for you in your career, in your early career. How did it go down? How did the Emil negotiating it go down? Just walk me through it from your perspective.

• 7:57Speaker 00

  So the actual negotiating, I think Emil did an incredible job of, and I don't want to steal any of the spotlight around his incredible art as a negotiator. My role was in opening the door for the conversation. I had spent my early career at Microsoft, since I was 18 years old, I'd been an intern at Microsoft since freshman year of college. And even in my freshman year of college, I met Steve Ballmer in the cafeteria and said hello to him and introduced him to my mom who was visiting. And I built a relationship with Steve over the years and for over a decade, we would have one on ones over lunch or we'd go jogging. I just told him I'm one of the fastest rising stars in your company. I'd like to have you as a mentor. When Emil told me that Tell Me are the company that I'd co-founded with Mike McHugh and

• 8:40Speaker 00

  Davis that it had a suitor and he told me who the alternate buyer was and he said, we need to get a conversation with Microsoft. We need other potential buyers at the table and how can you get me a meeting with Ballmer? And getting that meeting, I think, was my role. I went jogging with Steve and I told him about the opportunity. He was already familiar with Tell Me because he had been trying to recruit me back to Microsoft when I decided to leave. I left Microsoft to start Tell Me and he'd been on the other side trying to prevent me from leaving. And even while I was at Tell Me, I was personally fighting Ballmer on recruiting Harvard graduates and MIT graduates. I would call a student, he would call a student, I would call them back, he would call them back. And he knew that this was happening and he knew that the best and the brightest were not going to Microsoft and they were choosing our startup instead.

• 9:24Speaker 00

  So he had this sort of competitive desire to get that talent that he had lost earlier back at Microsoft. So during the jog, I basically told him, you know, Tell Me is now at the stage where if you want to have the talent that we hired, it's up for sale and it's a conversation that I think Microsoft belongs in. And so he basically said, get me connected and let's have the conversation. And what's funny is many other Microsoft folks afterwards jokingly told me, you're not allowed to go jogging with Steve anymore. Because they felt like this short circuited an entire process that would have otherwise gone through many layers of bureaucracy and corporate development, et cetera. But that acquisition was clearly one that Steve and Emil drove together.

• 10:00Harry Stebbings?

  While we're on Ballmer, I want to say that you sat in more product reviews with Steve Ballmer, with Bill Gates than so many other people. So when you think back over those like countless product reviews, what are some of your biggest takeaways, Hardy? And how did it shape your mentality and thinking?

• 10:15Speaker 00

  That's a great question. I should first say Steve Ballmer does not get anywhere near enough credit for having built Microsoft's into the powerhouse that it is right now. I think there's

• 10:24Harry Stebbings?

  Why do you say that?

• 10:25Speaker 00

  Yeah, the Steve years were not great for Microsoft's stock price. They were fantastic for Microsoft's earnings and earnings growth. And those earnings, it took some time for the stock price to match the earnings. And I think Satya as a CEO has really turned that part around. But earnings ultimately is what our company is about and Microsoft had phenomenal earnings growth during the Ballmer days. Getting back to your question of what is a review with either Ballmer or Gates, the thing that was similar With both of them is both of these folks as executives and Steve wasn't a founder, but he acted like a founder. They were so smart and sharp and into the details. You knew going into a review with either with Steve or with Bill, there's a huge risk that they know your stuff better than you know it yourself.

• 11:07Speaker 00

  And you better be extremely prepared. It's like the hardest examination of your life. Because if they catch you in not knowing your own stuff, you were done for. It just created, on the one hand, an element of fear. But on the other hand, this element of I need to be in my A plus game. And this bar that it made you strive to be the best version of yourself that you could be. And yes, there was a fear element to that because I've seen people get emaciated for not knowing their own materials as well. When Bill Gates knows something better than the supposed expert at his own company, it is emaciating, but it also makes everybody else think I need to be the best version of myself and be always prepared to be questioned.

• 11:43Harry Stebbings?

  I love that kind of attention to detail. But I'm always told about the importance of delegation and the importance of trust. Help leaders out listening. Does that go against delegation being so focused on the minute shy and so in the weeds? How do you feel about those kind of two opposing ideas?

• 12:01Speaker 00

  It is definitely a tough balance. And I gotta say, as a leader, I struggle with that myself. If I had to err, I personally err on the side of being more into the details rather than erring on the side of, oh, I just, the people are getting it done and purely trust them. And if you look at who are the greatest technologists for consumer companies? Or the greatest technology, consumer technology companies? If you think of Steve Jobs, Bill Gates, Mark Zuckerberg, Elon Musk, none of these folks are just trust that the team will get it done. They're getting very involved in little details. It's much harder to point to examples of incredible consumer technology successes where the CEO is just leaning back and letting everybody else get it done. But that doesn't mean the CEO does every little thing. It just means if you screw up, there's consequences.

• 12:44Speaker 00

  And as long as the level of getting involved in the details isn't enough to do everybody's job for them is to keep them to a high bar. Let me give you an example from a review with Ballmer. I've seen him in a situation where he's talking to a group and they're sharing the numbers. And then he dives into one number. He's like, wait a second. This number a year ago was blah, blah, blah. And you're just wondering, how does he remember this number from one like little product from one year ago? He's like, last year, when we did this review, it was such and such, what changed? Everybody starts looking around, they're like, I don't remember the previous number, I don't know what changed. And it creates this sense of, on the one hand, fear, but on the other hand, like, why aren't you on top of your numbers? Why am I the one who remembers what your business was like a year ago? And it forces people to think, I need to run my business the way a founder would do it.

• 13:26Harry Stebbings?

  When you compare Ballmer and Gates's leadership, how did they differ as leadership styles?

• 13:31Speaker 00

  I think Bill was far more into the technology and the products. Steve was far more into the numbers and the, I think, the sales. Steve is also just a motivator. He's an incredible cheerleader. He gets people so excited. He is incredibly charismatic. People make fun of things like him dancing on stage, yelling and screaming developers. But when you're in the moment with Steve Ballmer, he is so on, he is so animated, he is so excited. It is, for me at least, it's not something to laugh at, it is, it just fills you up with motivation and inspiration. His energy is infectious.

• 14:04Harry Stebbings?

  I do want to ask you, and speaking of incredible people that you've worked with, another that a lot of people told me I had to ask about was your first Facebook meeting with Zuck. And Ali told me, actually, you called him after the meeting and you said, this guy is the next Bill Gates. Ali asked, and I have to ask, how did the meeting go down? What did you see in Mark that made you say he was the next Bill Gates, having worked with Bill for many years?

• 14:26Speaker 00

  So this was in 2005. I was at Microsoft at the time, back when Microsoft was competing with Yahoo and AOL and the upstart Google in the world of search. I got an introduction to Mark Zuckerberg through Sean Parker, who was, as you may remember at the time, the COO or president. And Facebook at this time was nine people. They were in a hundred different colleges and it was called The Facebook. It wasn't yet Facebook. And we met the day they got their term sheet from Excel for the $100 million valuation. And Mark had basically just come from the meeting with Excel. My first thing I noticed is that he had an eye tic, he had just something going on, either with his contact lenses or something. He was continuously apologizing because something, he was had to rub his eyes and put eye drops in it and he just was not physically very comfortable.

• 15:10Speaker 00

  And I had been talking to Sean Parker about the company. The thing I noticed is the difference in terms of how Sean spoke about the vision for the Facebook versus Mark. Because what they had built at the time was kind of a chatting and socializing site for students in college and fraternities and sororities. But the way Mark talked about it, we're building the future of identity. We're building the future of connection. We're building a platform for everything on the internet. And this extremely far out vision, but also this level of seriousness and drive was very clear in him.

• 15:42Harry Stebbings?

  How different from the way Sean described it?

• 15:43Speaker 00

  When Sean was talking about it, it felt more like a sales pitch. And when Mark was describing it, it just felt more like this is my manifest destiny. Almost like it doesn't matter whether you're here or not, I'm just telling you what I'm about. This is me. He wasn't selling me. He was just like, this is the path I am on. This is what we're going to get done.

• 16:00Harry Stebbings?

  Did you invest on first meeting?

• 16:01Speaker 00

  I ended up becoming an advisor, which was actually slightly better than investing because I ended up getting in at a $10 million valuation rather than a 100 mil valuation, which is probably an insanely good opportunity.

• 16:13Harry Stebbings?

  Hadi, I'm going to be honest, it's one of those ones where it really doesn't matter. You know, when they say it doesn't matter and you're like, it kind of does actually, it really doesn't. What did you advise them on?

• 16:22Speaker 00

  I was helpful in terms of helping them early on with recruiting. When you're a nine person company and your main product is for 18 and 19 year olds, it's harder to get serious software folks engaged. Whether it was recruiting in customer support, in marketing, also in engineering. The guy who was the main architect for the future Facebook platform, Ari Steinberg, is a guy who I helped introduce them to.

• 16:43Harry Stebbings?

  I heard also from Arash and from Drew that you were instrumental in their engineering hiring process. What does a great hiring process then look like for you? How do you think about advising founders on their hiring? And where do you see many go wrong?

• 16:56Speaker 00

  Ultimately, the greatest technology companies are built by incredible people. And it's not just incredible software engineers. Every job has people who are outstanding and people who are medium and then people who are just phoning it in. And that's true with engineering. It's true with product management, product design, sales, marketing, even an executive assistant, the person taking care of the office, the level of passion and grit. And results people deliver can really vary. In the early days of a startup, most people don't realize the incredibly magnified impact of the first five or 10 hires. First five or 10 people you bring on board, it's not just what those people do. That's going to basically determine what the next hundred or the next thousand will look like.

• 17:38Speaker 00

  In every single role, you should aim to get the best of the best people. Because then when that's who you start with, that group won't allow in much more mediocre and just dispassionate people. And the best is not just about their IQ, it's also about their passion, their commitment to the mission. Both of those things need to be there.

• 17:55Harry Stebbings?

  As a startup, you can't get the head of sales from Slack to join your PLG company. So do you just constantly have to be the best talent identifier? How do you advise founders and when you look back at the Facebook on getting incredible A star people? When you're a random college site for communicating with nine people and a very young founder?

• 18:17Speaker 00

  It is not easy, but this is, I would say, the hardest and most important challenge for founders. So much attention is put on raising funds. And when you're fundraising, you're basically selling your idea, you're selling yourself to a venture capitalist. Those same skills are important where selling your idea, selling yourself, selling the company to a prospective hire. And the first five or 10 prospective hires are at least as important as the first person writing a check. In both cases, you need to convince the person this is worth investing in. In one case, the VC is investing them. In the other case, the amazing employee you want to hire is investing the next three, four years of their life. And making a major bet, a life bet on you.

• 18:56Speaker 00

  It is far easier for a VC to write a check with somebody else's money than to get a stellar engineer who has 100 options, but can only pick one of them to basically say, you're going to be the company that I'm going to make my bet on.

• 19:07Harry Stebbings?

  Do you agree that the majority of companies today are overweight in terms of people? We're seeing obviously this kind of mass reductionism. Do you agree that we got too overweight in our organizations?

• 19:17Speaker 00

  Twitter certainly is no longer overweight. But the changes in interest rates instantly changes just the reality of where things are at. In a world where interest rates are zero or even negative, nobody was overweight. When suddenly interest rates go up and there's inflation instantly when that changes, people needed to think our approach to spending is for a world that no longer exists. When the cost of borrowing is zero, why not add more stuff? There's practically no cost to it. Suddenly, when there's the cost of an interest rate, you need to have a different bar for which you evaluate every investment. During those heady days with zero investments, I think people just made financially poor decisions. There wasn't as much of an accountability or an impact if you made a financially poor decision. And so suddenly, the rising of interest rates forces,

• 20:02Speaker 00

  it's equivalent of the Warren Buffett quote of when the tides go out, you see who's swimming naked. When the interest rates go up, it forces accountability on financial rigor.

• 20:10Harry Stebbings?

  How do you advise founders today? Many say, cut deep, cut once. That's kind of the common saying. How do you advise founders on how to think about their orgs today in terms of cutting, not cutting, how to think that through?

• 20:22Speaker 00

  I would definitely say that if you're cutting, cut deep and do it only once. Multiple rounds of cutting or like just dribbling it out destroys morale and also destroys credibility. It is far better to build back from an organization that's too small than to just continuously whack till shave your organization down to the right size. If people are dropping that way, everybody wonders who's next? Am I next? The people you want to keep start looking. Whereas if you do a deep cut and you lose some people that you really shouldn't have, that's sad, but it's definitely better than the alternate error on cutting not enough and then having to do it again. The other thing I would advise is I don't think it's good to stockpile cash right now. A lot of people think in the old days, you'd say raise the largest amount you can when you can.

• 21:03Speaker 00

  That makes a lot of sense when inflation was zero and interest rates were zero. Whereas today, holding on to cash at a time of high inflation and higher interest rates, cash alone doesn't produce value. You don't need next year's cash this year. What you're going to spend it on next year, basically natural impact of inflation is that cash is going to be worthless one year from now. So why would you sell today's stock to get cash that you don't need for a year?

• 21:27Harry Stebbings?

  I think really for certainty. So you have more certainty today because the world has not collapsed. We don't have civil unrest and supermarkets running out of food and gas and energy breaking down. Down, which people think could be possible next year. Putin and with many political conflicts and with energy crises. And actually, the certainty of a bad deal today is better than the uncertainty of what could happen next year.

• 21:54Speaker 00

  Yes, I agree with that, but I think doom and gloom sort of risk reduction is more appropriate. If you're like a series C or series D startup. If you're a series seed startup, the doom and gloom that exists is you screwing up your own startup in the next 12 months. The higher order chance of just total failure is just your relationship with your co-founders. Do you find product market fit? Can you double or triple within the next year? But the macroeconomic stuff is real, but the gyrations in your little company are actually going to be a bigger thing when you're early.

• 22:24Harry Stebbings?

  Well, speaking of the gyrations, they're the things that you do control. They're your execution and you founded multiple different companies. You provide some of the best. When you think about leadership and high performance, what does high performance mean to you, Hardy? And has it changed over time, having seen different leaders?

• 22:40Speaker 00

  That's a really good question. I work extremely hard and one of the things that's changed that's difficult is basically there. It feels like there's a cultural change in terms of the expectations of how hard somebody should work. If somebody wants to work very hard, is that okay or not? I myself am a self-professed workaholic. So for me, high performance comes from both working smart and working hard, giving it my all, literally all the time. And in every job I've worked, even when I worked at Microsoft at a tens of thousands of person people company. I would pull all nighters, I would stay up late, I would work through weekends. I don't expect that of everybody who works for me, but that's what I do because I expect the highest performance of myself.

• 23:18Harry Stebbings?

  Is that high, is that high performance to you then respectfully?

• 23:22Speaker 00

  So that's, so that's what I was going to get to. I'm now older and as I've aged, I recognize I need to do much more to take care of my body and my mind. Because I can actually perform at a higher level if I'm also balancing my work with just the things that basically keep me mentally fit, physically fit. When I was in my twenties, I wasn't nearly as physically fit as I am right now. I didn't exercise as much, I just didn't have time for it. It was work, work, work. And I was on this hungry drive, frankly, to get money because my family didn't. Have any. I was worried whether my parents would die without a home. It was my job to make enough money so my parents could have a stable later stage of their lives.

• 23:58Harry Stebbings?

  Did you ever go through burnout or depression in those insane days?

• 24:02Speaker 00

  I haven't gone through burnout, but this is really important. There's a big distinction. If the work you do is something you love and something that inspires you, it isn't really work. And because of that, if you do more of it, you get more inspired and more driven, and you're safe from burnout. Whereas if the work you're doing is because somebody else is cracking a whip and telling you to put in more hours, you can get burned out. And I've chosen to work on projects that really drive me. And so working more actually makes me more excited, more inspired, more energized, rather than burnt out or spent or de-energized.

• 24:34Harry Stebbings?

  Speaking of more energized, I spoke to Alfred Lin, mutual friend before the show. And he said one of the special things about Hardy is the speed with which he works. He said specifically Hardy moves with lightning speed. How do you think about the importance of speed of execution? And I guess, how do you think about the balance between moving insanely fast and when actually it's better to go slow and get it perfect?

• 24:57Speaker 00

  This is a good question, and I gotta say, I'm not the best at going slow to go far. I'm far better at going fast to get something from zero to one. The thing that is most important to me is the speed of decision making and making decisions when you have sixty percent of the information to make a decision, especially with decisions that aren't one-way doors. Decisions where you can do it, and then if you got it wrong, you make adjustment. And if you got that wrong again, you can make another adjustment. I saw this in the difference between working at Tell Me, the startup I started, and then I returned to Microsoft into the MSN group, where it was this giant organization. And we were having meetings to prepare the slides for another meeting. I was in a meeting to prepare for a meeting, and I'm like, why are we meeting to prepare for the meeting? Let's just do the next, let's do the meeting.

• 25:40Speaker 00

  I don't even understand why we're meeting to prepare for another meeting. Let's just have that conversation now and save all this time. And I immediately said, from now on, there will be no meetings to prepare for meetings. So for me, the most important thing about speed is making decisions quickly and having a sense that if an idea is really good, we're just gonna do it. A predisposition to action. Rather than too much planning, but this doesn't work in all circumstances. This idea of shoot first, aim later, that works well when the consequences are smaller or when you can undo the mistakes because then you correct them. It doesn't work when you're running a multi-billion dollar company and things like global democracy are impacted by your actions. The larger you get, the greater your impacts, the more you need to take things slower.

• 26:22Speaker 00

  And that balance is something that I'm myself learning as I get older myself.

• 26:26Harry Stebbings?

  As a leader today, how do you assess your own decision making frameworks?

• 26:30Speaker 00

  So one of the things I've been doing at code.org is to actually put into writing what I think is the thought process I go through so that I can pass down the framework I use rather than making a decision. Because I realized we were in a situation where people on my team were judging their decisions by trying to predict what Hadi would want, which is common in organizations where you're trying to guess what is the CEO going to want. So you don't end up with a disappointing situation where he decides something else. I've tried to figure out how to delegate the decision, but also with it delegate the framework I use. And so in fact, I made a 10-page document laying out the different things I balance when I make a decision. And then I have my leadership team play act five or six sample scenarios to see the conversations they would have when discussing, should we do this or should we do that?

• 27:15Speaker 00

  And that doesn't mean they'll make the same decision as me, but as long as they're using the same framework, as long as they're balancing and as long as we're playing on the same field with the same idea of what a scoring a goal is and what is a foul, they might come up with a different way to score a goal, but we have an agreement on the high level framework.

• 27:29Harry Stebbings?

  What are the core principles that make up that framework?

• 27:32Speaker 00

  These are specific to the business of code.org, but one of them is aiming for the long term, doing what's right for the long term, not just the short term. Another one is paying attention to return on investment because there's multiple things we could do that do good and we're a nonprofit. But how much good did we do and how much did it cost us? Many nonprofits don't measure that. And so I put in place, for example, if we're impacting students at the high school level, the cost for teaching computer science to a student should add up to roughly $10, not hundreds or thousands of dollars. So for example, if you ask the question, should we give scholarships to students? Then I would say unless it's a $10 Scholarship? No, because the amount of the money being spent, it does good, but it doesn't do enough good.

• 28:15Speaker 00

  This concept of return on investment is one of the important parts of my framework. A third one is envisioning the ecosystem of partners and where it should be. So we don't need to do everything ourselves, figuring out what are the pieces we uniquely can do so that others can do the rest of what needs to get done. There's multiple parts to this, it's like a 10-page document, I can't summarize it quickly.

• 28:33Harry Stebbings?

  When you think about one of the most seismic decisions you've made that sticks with you, it could be good or it could be bad. Can you take me to that, how it impacted your decision-making as a result?

• 28:43Speaker 00

  I think there are two seismic decisions I've made in my career and life. The biggest one was the decision that I wanted to take a backseat from the corporate rat race, that I didn't want to aim to be the wealthiest I could be, but that I actually wanted to optimize my impact. I was about 40 years old, but I decided I'm not going to be the wealthiest. And if I'm not going to be the wealthiest, whether I'm second or third or fourth or hundredth or whatever, everybody who's measuring their value based on money is behind somebody else. And it really doesn't matter, you can't take it with you. That doesn't mean I don't care about material things, but I wanted something else that really drives me. And so I made this very deliberate decision to say, I'm going to first and foremost, measure my self-worth in my own eyes based on my societal impact.

• 29:26Speaker 00

  And that drove me to not go into, get recruited to be CEO of a new startup. And the next company I started, code.org, was a nonprofit rather than a for-profit. And whether it's for-profit or not wasn't important, what mattered to me is how much impact does it have?

• 29:39Harry Stebbings?

  Ego-wise, everyone does it for ego really, in many ways. Not everyone, but 90% of people, whether it's the money, whether it's the badge that they represent. Do you just not have an ego?

• 29:49Speaker 00

  I definitely have an ego, that's such a good question.

• 29:53Harry Stebbings?

  No, I'm just saying, right, you were like, no, everyone's running on these fucking treadmills. I'm going to go off to the side and not play this game. And I'm like, why?

• 30:01Speaker 00

  I definitely have an ego and it constantly nags at me. But what's important to recognize is the difference between your own self-worth versus what other people value. And so many people measure themselves through the eyes of other people and then lose sight of measuring themselves through their own eyes. It's an important skill. To learn that your own self measurement of yourself is more important. If everybody else thinks he's doing something not as good, but you think what I'm doing is really good. That's more important than if everybody's like, oh, he's very wealthy. Good for him. And inside you feel like shit. That's no good.

• 30:35Harry Stebbings?

  You know, I think we're socially ingrained or indoctrinated with wealth, title, looks, physique. As like the status symbols of self worth.

• 30:44Speaker 00

  Absolutely.

• 30:45Harry Stebbings?

  That's all we know, though. I don't think we know what our own self worth is compared to what other people view us.

• 30:53Speaker 00

  Agreed. That is why I said this was the most seismic decision for me. It was this recognizing that American society is such a consumerist society and fame, followers and dollars. Fancy cars, fancy clothes. These are the things that symbolize who's doing the best in everybody else's eyes. And I made this proactive decision. That's not the most important thing for me. I don't want to measure myself first and foremost. I don't want to play that game. And it bums me out when I see people who I consider my peers much wealthier and getting a level of attention. And I think, oh, I could have done the same thing. I'm not walking back from that decision. I don't have any regrets. But it was a proactive decision to basically say, whatever insecure demons I have, I'm going to recognize those as insecure demons.

• 31:36Speaker 00

  I'm not going to feed them by orienting my life around feeding them, but they still exist.

• 31:40Harry Stebbings?

  Respectfully, do you think it's so much easier that you have money? Like you were very successful before. You can be like, oh, now I can do this, but I'm still living a really nice life.

• 31:49Speaker 00

  For sure. I reached a level of wealth where I decided the material things I could spend more money on to get aren't as important to me. If I was still worrying about paying rent and wishing I had a nicer house, I probably would still be on the financial treadmill. But many of my friends, many of the folks that you interviewed are wealthier than I am. And I don't spend my days thinking, how do I get just as much money as they do? I spend much more time thinking, how do I get the computer science impact of code.org to one billion students? Because I know if I had double the money, I'd spend the extra money on code.org to have that societal impact.

• 32:23Harry Stebbings?

  Did you feel a mental relief when you accepted the insecurities and then took a step aside?

• 32:30Speaker 00

  A little, but honestly, there was a period of fear from the point of saying I'm going to step aside before I was successful at social impact. When I started the work of code.org in the world of societal impact, we were nothing. So there was this period of what if that screws up? What if I've stepped off of this rat race and it was a mediocre meh? Oh, great. You did some cool thing, but nobody cares. The true, when you're asking, did you feel a real relief? The true relief came when I realized how incredibly globally impactful code.org has been. And we've reached a stage where even if the current organization blows up and everything that is called code.org disappears, the impact we've already had on hundreds of millions of students, that impact is going to stay forever. The real relief comes from knowing that basically I've already done enough and nobody can take

• 33:15Speaker 00

  that away from me.

• 33:16Harry Stebbings?

  Okay. So we've spoken about kind of reimagining education. We've spoken about code.org. We look at society today and I'm pretty worried about the future of education as it fits perfectly in with what you do every day. I think generative AI makes life even more challenging when you look at the future of work and skills gaps. How do you think about how we need to rethink school for a future of automation?

• 33:37Speaker 00

  This is a fantastic question. There's so many people who have opinions on education. I've spent now 10 years in the world of what you could call modernizing education. And the first thing I'd say is almost everybody else who thinks about the world of education thinks about how to teach better rather than questioning what to teach. The world is changing so quickly that teaching the same things that we taught 100 years ago no longer makes sense. A student starting kindergarten today is going to begin their career in the late 2030s. At that point, is speaking foreign languages going to be relevant when your AirPods automatically translate the words that somebody else says to you? Or when your AR glasses can translate the words that you see on a screen? Is how much math will you need to learn at a time when today your iPhone can scan an

• 34:22Speaker 00

  algebra problem and give you the answer, including the explanation and showing you the work? How much writing will you need to do when today you can have your college essay written by an AI for you? And I'm not saying we shouldn't teach math or we shouldn't teach English or that we shouldn't teach foreign languages, but I do think we should start from a blank slate and question. What are the skills that kids are going to most need in the late 2030s? Start from a blank slate rather than from the curriculum that has been handed down year over year. And then add to that blank slate.

• 34:51Harry Stebbings?

  Gambling children's educations on the future of how we perceive society will be. Let's be honest, Hadi, I've got no fucking idea where late 2030s will be. Generative AI could be at a place where actually it's not that far from where we are now. It could be at a place where you're totally right and I can't see what we would teach.

• 35:08Speaker 00

  Everything we do is a bet. Not acting is also a different bet. We have been betting on inaction. We've been betting on non-change in terms of our curriculum. While the world is changing at the fastest pace ever and not changing what we teach is its own different gamble. And now I'm not saying we shouldn't teach kids reading or that we shouldn't teach math. For sure, we should teach those things. I'm saying we should ask the question of what should school teach them? Now, my own life mission is that schools should teach computer science. The reason we should teach computer science is it is an incredibly safe bet. That some form of computer science is going to be nominally relevant in the late 2030s. It'll be increasingly more and more relevant because all of the things that are changing the world around us

• 35:49Speaker 00

  are changes caused by software, whether it's coding, whether it's AI and machine learning, whether it's data science. These things are changing the world around us. Besides computer science, there's other things that our school system should emphasize more than it does. Whether it's statistics, financial literacy, understanding civics and preparing people for citizenship. But we don't do those things. We don't teach statistics as much as we teach calculus. And that seems crazy to me because everybody uses statistics in their daily lives. And maybe 5% of people use calculus in their daily lives.

• 36:21Harry Stebbings?

  Would you homeschool your children?

• 36:22Speaker 00

  I wish I had the time and patience to do it. I've considered it. Certainly during the pandemic, I considered it. But another point of view I have as an educator is that the most important act of education is to inspire. Socrates once said that education isn't the filling of a pail, it's the lighting of a fire. And so what I do as a parent is I try to, I don't homeschool my kids. I ask them questions or point them in directions to inspire their own curiosity. And then I know that they'll go find their way through YouTube and the internet to learn the things that I think they're missing in school.

• 36:52Harry Stebbings?

  We mentioned kind of the change of content type. In terms of the change of how it's taught, does that need to be changed as well? I know Elon's spoken extensively about his school, which changes how things are taught specifically. How do you feel about that?

• 37:06Speaker 00

  Yes, education is both change of what we teach and how we teach it. In terms of changing what we teach, we should include computer science as well as the other things I mentioned. In terms of changing how we teach it, school should be more student-driven, curiosity-driven, project-based, creative and collaborative. If you look at what employers are looking for and what the workforce of today wants, they want problem-solving, creativity and collaboration. And yet, our school system in many classes repeats the sort of, you're going to listen to a lecture and write notes and then memorize it and then answer questions on a test. It is way better to say, instead of listening to a lecture, here's a blank canvas, what can you create?

• 37:44Speaker 00

  That is part of why computer science is a better thing to teach, because it is project-driven, it is a collaborative, creative, problem-solving type of thing. Whereas many other projects in school aren't that way.

• 37:55Harry Stebbings?

  Can I, I read, I think it was GitHub's survey, that forty-one percent of code today is now generated by AI. What does the future of code look like, coming from code.org founder?

• 38:07Speaker 00

  That's a really good question. The future of code and the past of code have all had this progressive, it gets easier and easier to code. When my dad started coding, it involved punching little holes in cardboard cards and putting those in a computer. And those holes represented zeros or ones. And then you could type the zeros or ones. And then you could type three letters for each machine code that goes directly onto the CPU. And now today, you have languages that are more like the English language. We're getting closer and closer to giving the computer instructions in a natural language, and then it figures out the underneath code. So every decade, there's a leapfrog in terms of how much easier it is to code. So generative AI is going to make it possible to use much higher-level commands than today's languages.

• 38:52Speaker 00

  And the computer science education needs to adapt to that. It hasn't yet adapted to that. Now, that doesn't mean that we won't need to understand computer science. It means that the level At which you learn to code is going to be different. If you were teaching coding in the nineteen seventies, you would be teaching punching holes in a card and ones and zeros, and nobody uses that anymore. And we may be at a higher level. But understanding the code is still important. Think if you use generative AI to write an essay, you still need to read that essay. You don't just say, please write me a blog post and then, okay, it's done. Ship it. You want to read it and confirm it's the thing that the AI did the thing that you wanted.

• 39:28Harry Stebbings?

  And that's gonna be true for a while too. You don't know Gen Zs today. I think they would just say it's fine.

• 39:33Speaker 00

  It's good to go.

• 39:34Harry Stebbings?

  Yeah, good to go. It's better than I would have done it because I wouldn't have done it at all. So great, fantastic. We've spoken about kind of the shaping of people's minds and the next generation's minds. I think the worrying thing for me is actually the reshaping of existing minds in the workforce. I think OpenAI today released incredible new development, which is very exciting and very terrifying at the same time. When we think about reshaping existing workforces, how do you think about what needs to happen for the existing workforce to reshape their skills and actions to accommodate a very new economy and technology stack?

• 40:08Speaker 00

  It's hard to know what the jobs of the future are going to be, but what's very clear is that they're going to be increasingly digital, increasingly more creative. And so, teaching creativity, problem solving and digital skills, especially digital skills, is a must. And there's many efforts being done by the largest tech companies, by Microsoft, by Google, by Amazon, to spread basic digital skills. At the same time, I also think automation isn't just going to destroy jobs. It's going to change jobs. There's jobs that we have shortages of that suddenly more people will be able to do. So there's a teacher shortage, there's a nursing shortage. Having more nurses, it would be great for everybody's healthcare. So some jobs will go away, which will mean people will be able to fill the jobs that we struggle to fill today.

• 40:49Harry Stebbings?

  Adam Smith's Invisible Hand, big believer in it. Listen, Hadi, I want to move into my favorites. So it's a quick fire. So I say a short statement, sixty seconds, you give me your immediate thoughts. So I'm going to start with, what's your favorite book and why?

• 41:01Speaker 00

  My favorite book is Sapiens. And the reason why is because it really changed how I think about the history of humanity and gave me a framework for looking at both past and the present that I didn't have before.

• 41:12Harry Stebbings?

  Are you ever planning to go back into the tech for-profit business from Emil Michael?

• 41:18Speaker 00

  I'm not planning to go back into the for-profit business. I never say never, so we'll see.

• 41:22Harry Stebbings?

  Do you get tempted by cash?

• 41:24Speaker 00

  I definitely get tempted by cash. Everybody gets tempted by cash.

• 41:27Harry Stebbings?

  I had to ask it. What do you know now that you wish you'd known when you started in startups many years ago?

• 41:32Speaker 00

  The value of betting on myself, betting bigger. I started out with too much fear of failure. I took bets, but I wish if every bet I took, I had bet twice as much, I think I would be more successful in every way.

• 41:44Harry Stebbings?

  If you look back on a bet you didn't take but wish you had, what one are you like?

• 41:49Speaker 00

  There are so many of those. Anybody who's had a career in tech has many of those. The biggest oh fuck was Mark Zuckerberg at a time was recruiting me to be the CEO of Facebook. This is before he hired Cheryl for the job and I was in a startup together with my twin brother. Basically, I decided out of loyalty to my brother and we had just raised a round. I can't just quit and join this other company. We're co-founders and he's my twin brother, but the startup with my twin brother ended up kind of nowhere. It was basically a moderate failure and being CEO of Facebook would have been an incredible success.

• 42:20Harry Stebbings?

  I would sell my brother to be CEO of Facebook.

• 42:23Speaker 00

  It was very clear at the time. It was a bad financial choice. It was a choice for family and loyalty.

• 42:28Harry Stebbings?

  Who's the best board member that you've ever worked with and why them?

• 42:31Speaker 00

  Jeff Wilkie is definitely the best board member. Jeff Wilkie was the number two at Amazon before he left a few years ago. He was the CEO of Worldwide Consumer at Amazon, so everything they sell at all of the Amazon stores and marketplaces. There's a couple of things that make him an amazing board member and he's on my board. He's my vice chair at code.org. One, first of all, is he is so available. Even when he was running a million-person organization, he would, if I had a question or I needed something, I would text him on a Saturday and he'd be like, let's meet at such and such time on Monday. And I'm like, obviously he has lots of other important things on his schedule. He'd make time for me. I thought it was just me, but he makes time for so many people and I don't even know how. The second way is he does what I'm trying to learn to do as a board member, which is teaching through asking questions rather than just giving you the answer.

• 43:17Speaker 00

  So an important role of a board member isn't just to say, here's what you should do, but is to ask questions to help. Leadership team come up with that answer and come up with their flavor of that answer.

• 43:27Harry Stebbings?

  If you could join any startup today, what would it be and why that?

• 43:30Speaker 00

  If I could join a company today, this isn't really a startup, but it would be Axon, which is the company I'm on the board of. Axon's a $10 billion public company, but it still has 100x growth potential. And the reason is it's not just a company that's reinventing technology or making a lot of money. But Axon is also having incredible societal impact. Axon is basically a company that creates technology for law enforcement, like body cameras for police to keep police more accountable. Or VR training for police so that they're not scared of running into the mass shooting at a school and not standing outside the door. Every time you hear about deaths caused by law enforcement or deaths that were caused by lack of law enforcement. You think, God, our society could be better.

• 44:12Speaker 00

  And Axon is a technology company that's trying to use technology to improve how society works. And it's something I love.

• 44:18Harry Stebbings?

  What do you believe that few around you believe?

• 44:20Speaker 00

  I believe that the next five to 10 years are going to be the best five to 10 years for humanity. And I think we are surrounded by doom and gloom because.

• 44:28Harry Stebbings?

  What are you smoking, Hattie? I'll take some of this. Why? Why is it going to be so good?

• 44:33Speaker 00

  I would start by saying our, the news we spread, which therefore becomes the news we read, is the worst stuff. That doesn't mean the world is so terrible around us. Poverty is at its lowest. Wars, despite the war in Ukraine or the war in Yemen, is at its lowest. If you look at most of the measures of prosperity, they've gotten better and better every year for decades. And so we're already the best we've ever been, despite all the terrible news. But when you open social media, the news that gets clicks, the news that gets liked and retweeted is the terrible news. Code.org has taught hundreds of millions of students computer science. That's not spreading on Facebook nearly as much as Sam Bankman Fried losing billions of dollars.

• 45:13Speaker 00

  But if we add up the good and the bad news, the total has been a story of great prosperity for the human race.

• 45:19Harry Stebbings?

  The truth is humans are inherently bored beings. And actually, crisis and disaster is entertainment of some sort. Fulfilling, not happiness wise, but it fills time and discussion in otherwise monotonous and boring life.

• 45:33Speaker 00

  When you read a terrible story, you're much more driven to retweet it because did you hear this incredible story, this schadenfreude of this terrible guy who destroyed so many people's lives, or did Elizabeth Holmes get sentenced, et cetera? That's the news you want to retweet, that's the news you hear, so it makes you feel like the world is a terrible place. So the thing I believe that nobody else does is that the world is actually getting much better and 10 years from now it'll be even more so.

• 45:56Harry Stebbings?

  What does great fatherhood mean to you, Hadi?

• 45:58Speaker 00

  Oh my gosh, my father is one of the most important figures in my life. The most important role I think of a father is to set a good example for your children. It's not measured in how many hours you spend, but in the quality of those hours. And the other thing is making sure your kids know that you love them truly, that you accept them, because so many kids feel their father's disappointment as this stress that they're trying to resolve tens of years later in their lives. And instead just knowing that, nope, I'd rather my kids deal with their own self-disappointments rather than worrying about what I think.

• 46:27Harry Stebbings?

  Do you tell your children that you love them often?

• 46:29Speaker 00

  All the time.

• 46:29Harry Stebbings?

  I like that, I should start a parenting show too. Brought to you by Nordstrom. A final one, my friend, next five years for you and what's the plan ahead?

• 46:36Speaker 00

  Right now, my time is split mostly on code.org and then also on the two boards that I serve on Mountain and on Axon. What's most important for me in the next five years is the work of code.org getting computer science to being a requirement for high school graduation in US schools. There's five states in the US that require every student must learn computer science to graduate high school. At five years from now, I hope that it's going to be 25 states and that we've tipped the point that the majority of states have this requirement and then we'll get to the point where the ones that don't feel on the outs.

• 47:07Harry Stebbings?

  Hadi, I've absolutely loved this conversation. Thank you so much for putting up with my very direct questions. You've been a fantastic guest.

• 47:14Speaker 00

  Thank you so much.

• 47:17Harry Stebbings?

  Now, if you'd like to see more from us, of course you can on YouTube by searching for 20VC. Likewise, you can go to 20vc.com to find out more. But before we leave you today, AngelList is making it easy to launch a fund, launch a startup and invest in either. I love using the AngelList platform because it removes all the friction associated with starting and scaling a fund, whether you're running SPVs, a venture fund like me, or a rolling fund. AngelList has As you covered, for founders and their teams, Angel List also has a suite of startup products that abstract away all the complexity associated with running a startup. You can launch a fundraising-ready startup in just a few clicks, and Angel List handles incorporation, banking, cap table, compensation, fundraising, and more,

• 48:01Harry Stebbings?

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• 48:44Harry Stebbings?

  GiveDirectly also uses poverty data and advanced targeting to identify those in greatest need, often in areas of sub-Saharan Africa that are so remote that other aid groups aren't able to reach them. Visit givedirectly.org/20vc to learn more and send money directly to someone living in extreme poverty to spend on what they need most. That's givedirectly.org/20vc. And finally, from websites and online stores to marketing tools and analytics, Squarespace is the all-in-one platform to build a beautiful online presence and run your business. And there are three things that are just fantastic about Squarespace. First, mobile-optimized websites. All websites look fantastic and are optimized for mobile.

• 49:27Harry Stebbings?

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