Stratechery (with Ben Thompson)

1. DRDavid Rosenthal0:00

   Ooh, market's got a nice bump today. You have a good feeling about Jerome?

2. BGBen Gilbert0:04

   Yes. I get these vibes from him, you know?

3. DRDavid Rosenthal0:06

   I want Jerome to, like, wake up on his 2021 side of the bed one day, just be like, "You know what? Times were good back then."

4. BGBen Gilbert0:14

   We caused cataclysmic damage that needed to get unwound at some point, but while it was up, it was all good.

5. DRDavid Rosenthal0:19

   Do I really need to keep bringing down the hammer?

6. BGBen Gilbert0:21

   Let's take this FOMC meeting off.

7. DRDavid Rosenthal0:24

   I'm gonna post a story on Instagram just on a beach with a drink. [laughing]

8. SPSpeaker0:29

   [singing] Who got the truth? Is it you? Is it you? Is it you? Who got the truth now? Is it you? Is it you? Is it you? Sit me down, say it straight, another story on the way. Who got the truth?

9. BGBen Gilbert0:46

   Welcome to season 11, episode eight of Acquired, the podcast about great technology companies and the stories and playbooks behind them. I'm Ben Gilbert, and I am the co-founder and managing director of Seattle-based Pioneer Square Labs, and our venture fund, PSL Ventures.

10. DRDavid Rosenthal1:01

    And I'm David Rosenthal, and I am an angel investor based in San Francisco.

11. BGBen Gilbert1:06

    And we are your hosts. Today, we are telling the entire history and strategy of Stratechery, and we are joined by the man himself, Ben Thompson, on the eve of Stratechery's ten-year anniversary. Stratechery is innocently billed on his website as the business strategy and impact of technology. Stratechery, as Ben puts it, started as some guy in Taiwan with no access. Today, Stratechery is a powerhouse, shaping the thoughts and conversation of the entire technology industry around the world at the highest levels. Ben has interviewed Mark Zuckerberg, Jensen Huang, Satya Nadella, Sundar Pichai, Rich Barton, Meredith Kopit Levien of The New York Times, Pat Gelsinger of Intel, and John Collison, and many, many more, many of which are regular readers. He is the father of aggregation theory, the most important business framework developed in the last twenty years. And Ben really pioneered the internet subscription newsletter business model. We sat down with him to talk about a bunch of his recent changes, going big into podcasting, bringing on co-hosts and expanding the empire, and even now launching a Stratechery property that he does not appear on at all.

12. DRDavid Rosenthal2:18

    Regardless of what your business model is, regardless even almost of what your content is, I don't think there's any creator, certainly not any business creator out there today, who doesn't directly or indirectly look to Ben and say: "You inspired me. You paved the way for what I do." I mean, we certainly feel that way. I feel that way.

13. BGBen Gilbert2:38

    David, I even feel like your and my friendship developed early on from reading Ben's pieces and sharing them with each other with our thoughts. We have these old email threads in 2014 of you and I discussing Ben's writing.

14. DRDavid Rosenthal2:50

    Ah, totally. We might talk about that on the episode here.

15. BGBen Gilbert2:53

    Well, for our presenting sponsor this episode, we are back with Fundrise CEO Ben Miller, and we asked him to share with us what his inspiration was for launching the Fundrise Innovation Fund.

16. SPSpeaker3:03

    So technology will disrupt every sector, including venture capital. I don't believe any VC would argue they're immune. It happened to commerce, happened to news, entertainment, public markets, et cetera. But just like every other incumbent, they may have trouble imagining it. So the mission of our company, Fundrise, is bring about that sea change. So how do we do it? So in my experience, what happens is an industry ages, and the stories it tells itself, which were once true, become no longer true.

17. DRDavid Rosenthal3:38

    You saw this play out in real estate.

18. SPSpeaker3:40

    Yeah. So typically, in a financial industry, the essential story is about alpha. The incumbents raise money and create alpha, and that alpha is usually about deal picking, making the best investments. And in other financial markets, for example, public markets, technology made those markets more transparent and more efficient over time, and that alpha went away. And Vanguard basically consistently beat the best hedge funds in the world. So that's going to happen to venture capital. It'll start where I think we're starting, which is mid to late-stage companies, where there is a lot more data, and that's what we're doing. The Fundrise Innovation Fund is a public mutual fund. It's like a Vanguard for the private technology markets.

19. BGBen Gilbert4:21

    And so if I can paraphrase, it's less about picking the winners to guarantee alpha, but more about increasing transparency and access so that more investors can just get the benefit of beta, these correlated returns, where when the market goes up, you're invested in that asset class, so you get to go up with it.

20. SPSpeaker4:40

    Right. If you'd indexed into cloud from 2012 to 2017, and you just said, "I'm gonna find data that indicates the top ten or twenty percent of companies with product market fit," you would have done great. I learned this in 2008: the cycle and the market is way more powerful than the individual. You think you're adding alpha, but you're actually riding these mega trends. I mean, it's gonna happen to venture for sure. It's inevitable. It happens to every sector. I just wanna be the one helping do it.

21. DRDavid Rosenthal5:11

    And for founders, once you're at that stage, the actual natural best fit and form of capital for you is the equivalent of mutual fund public market capital, and that's what you're bringing for the first time to the industry.

22. SPSpeaker5:23

    Right. Exactly.

23. BGBen Gilbert5:24

    Our thanks to Fundrise. If you want to join the over three hundred and fifty thousand individuals investing with Fundrise, you can click the link in the show notes. And if you're a founder and you want to get in touch about having the Innovation Fund participate in your next funding round, email notvc, that's notvc@fundrise.com. After this episode, come hang out with the other thirteen thousand smart, thoughtful members of the Acquired community at acquired.fm/slack. We'll all be talking about it. Without further ado, this is not investment advice. This show is for informational and entertainment purposes only. And now on to our interview with Ben.... Ben Thompson, welcome to Acquired.

24. BTBen Thompson6:05

    Thank you. Happy to be here.

25. BGBen Gilbert6:06

    It's great to have you with us. We've done surveys over the years of our audience, and we say, "What is the number one topic that you'd wanna see us cover, or person we should have on the show?" And your name comes up many, many times, so, I'm excited to be doing this.

26. BTBen Thompson6:17

    You promised me I was number one. Now I feel like there's a bit of a letdown going on. [laughing]

27. BGBen Gilbert6:20

    We asked who the number one was, and you were very high in the rankings.

28. DRDavid Rosenthal6:23

    Well, we have another number one, though, that is very near and dear to our hearts. Ben was searching his email today, and he sent me an image over text that was very sweet. It was the first email between us, and it was about Stratechery.

29. BTBen Thompson6:36

    Okay, fine. I'll take that.

30. BGBen Gilbert6:37

    [laughing] David and I, I think, got drinks and were talking about Uber, and it was your Don't Blame Uber piece from 2014.

Episode duration: 1:56:10