All-In PodcastE54: Spread trading big tech, capital allocation, Zillow's misfire, Progressives suffer losses
At a glance
WHAT IT’S REALLY ABOUT
Big Tech Spread Trades, Zillow’s Collapse, and Voters Reject Wokeism
- The episode opens with banter before diving into markets, where Chamath outlines a spread-trade strategy: go long Microsoft and Google while shorting the rest of big tech to manage market risk and exploit relative outperformance.
- They discuss capital allocation and fund structures, contrasting traditional VC distributions with permanent capital models like Sequoia’s evergreen fund and Friedberg’s Production Board, and touch on whether DAOs can realistically manage early-stage investing.
- In real estate, they dissect Zillow’s failed iBuyer program, arguing it conflated speculative price-taking with true market making, and contrast its operational and data weaknesses with Opendoor’s more focused, software-driven model.
- The back half is dominated by politics and policy: a ‘woke lash’ in recent U.S. elections, backlash to progressive education reforms (CRT and detracking math), and optimism about scientific solutions to climate change, including a breakthrough CO₂-to-starch process that could massively accelerate carbon removal and biomanufacturing.
IDEAS WORTH REMEMBERING
5 ideasUse spread trades in big tech to reduce market risk and bet on relative winners.
Chamath argues the most compelling internet trade is to go long Microsoft and Google while shorting other mega-cap tech (Apple, Amazon, Facebook, Netflix), capturing outperformance without taking full directional market risk.
Distribution decisions in VC should distinguish between venture skill and public-equity skill.
They note that even top firms like Sequoia must confront whether they can compound capital as effectively in public markets as in private ones, suggesting LPs may often be better off receiving shares and deciding for themselves.
Copying a focused upstart is far harder than it looks for incumbents.
Zillow’s attempt to replicate Opendoor exposed how entrenched legacy products (like Zestimate) and thin operational expertise can lead to mispricing, low margins, and huge losses in complex, low-margin, capital-intensive businesses.
Political extremes in behavior and policy are being punished; moderation is winning.
They interpret recent elections (e.g., Virginia, New Jersey, local DA races) as a repudiation of both Trump-style behavioral extremism and progressive policy extremism, with voters prioritizing economy, education, and safety over ideology.
Education fights hinge on equality of opportunity versus equality of outcomes.
Debates over CRT, detracking math, and removing advanced courses reflect a deeper conflict: whether to level results (‘equity’) by capping exceptionalism, or expand opportunity so more students can reach high performance without dragging top performers down.
WORDS WORTH SAVING
5 quotesThe best trade on the internet is long Microsoft, Google, short the rest of big tech.
— Chamath Palihapitiya
Catching a wave of disruption is very difficult when you have an old-line business that is fundamentally competitive with a new line of business.
— Chamath Palihapitiya
Trump was behaviorally extreme… Now what we’re realizing is a different form of extremism, which is policy extremism, will also be met with the same response.
— Chamath Palihapitiya
This is a very old debate. It’s the debate between equality of opportunity and equality of results.
— David Sacks
If we have a great gain… we can take the gain and we can reinvest that capital in building new things. There’s no shortage of opportunities to pursue for the rest of my life.
— David Friedberg
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