E65: VC markup dynamics, Russia/US tensions over Ukraine, Altos Labs raises $3B, Stripe mafia & more

1. 0:00 – 1:35

   Chamath's preferred cosplay

   1. JCJason Calacanis0:00

      We don't want to talk about Anduril. I think that guy, Palmer Lucky, is super fascinating, the Oculus guy.

   2. DSDavid Sacks0:03

      Why do you want to talk about that company?

   3. JCJason Calacanis0:05

      'Cause I think an American company-

   4. CPChamath Palihapitiya0:06

      He's launching a syndicate soon.

   5. JCJason Calacanis0:08

      No. I... He-

   6. DSDavid Sacks0:09

      Are you an investor?

   7. JCJason Calacanis0:09

      Palmer Lucky hates me. He won't come on This Week in Startups. He literally hates me.

   8. CPChamath Palihapitiya0:12

      What did you call him, Parma Lucky? (laughs)

   9. JCJason Calacanis0:14

      Palmer Lucky, cosplay Palmer.

   10. CPChamath Palihapitiya0:18

       (laughs)

   11. JCJason Calacanis0:18

       He's a cosplayer. I like the fact that he does cosplay.

   12. CPChamath Palihapitiya0:20

       What, what is that?

   13. JCJason Calacanis0:21

       That's when you dress up as comic book or like superhero characters and go to conventions with other nerds.

   14. DSDavid Sacks0:24

       You know how you dress up in the clothes of old Italian women?

   15. CPChamath Palihapitiya0:27

       Yes.

   16. JCJason Calacanis0:27

       He dresses up like a-

   17. DSDavid Sacks0:29

       (laughs)

   18. CPChamath Palihapitiya0:29

       (laughs)

   19. JCJason Calacanis0:29

       ... superhero.

   20. DSDavid Sacks0:30

       (laughs)

   21. CPChamath Palihapitiya0:30

       (laughs)

   22. JCJason Calacanis0:30

       Ha ha, here's a cold open, folks. (laughs) You know, Chamath, uh-

   23. CPChamath Palihapitiya0:34

       I, I do dress like a matrona sometimes.

   24. DSDavid Sacks0:37

       (laughs) Yeah, right.

   25. JCJason Calacanis0:37

       Oh, I'm a Chamath. I'm making you the rigatoni.

   26. DSDavid Sacks0:41

       (laughs)

   27. CPChamath Palihapitiya0:41

       (laughs)

   28. JCJason Calacanis0:41

       You want rigatoni with the vodka sauce?

   29. CPChamath Palihapitiya0:43

       You know, in the-

   30. JCJason Calacanis0:43

       I make it for you.
2. 1:35 – 15:20

   Reflecting on prior investment decisions and markup dynamics

   1. DFDavid Friedberg1:35

   2. JCJason Calacanis1:35

      Hey, everybody, welcome to another episode of the All In podcast. Yes, we're still publishing. Yes, (laughs) we haven't been canceled, but it's early in the show, so you never know. Uh, with me again, the dictator himself, Chamath Palihapitiya.

   3. DSDavid Sacks1:49

      (singing)

   4. JCJason Calacanis1:49

      The sultan of science, David Friedberg. Whatever beverage you like, he'll make it for you right now in his replicator. And of course, yeah, the Rain Man himself, yeah, definitely gonna win the midterms, yeah, David Sax. Everybody have a great week getting their asses kicked in the market?

   5. CPChamath Palihapitiya2:07

      I'm pretty good.

   6. JCJason Calacanis2:09

      You're okay? Everybody okay?

   7. DSDavid Sacks2:10

      Pretty good.

   8. JCJason Calacanis2:10

      Nobody checking out of the window?

   9. DFDavid Friedberg2:13

      I can't even look. I can't look at my portfolio anymore. I just stopped checking it. (laughs)

   10. CPChamath Palihapitiya2:16

       (laughs)

   11. JCJason Calacanis2:18

       I, uh, not a fan of the color red.

   12. DFDavid Friedberg2:19

       (laughs)

   13. CPChamath Palihapitiya2:20

       I actually, um, I, I've been using this period to kind of desensitize myself. Um, I went back and I started to think about like all of the sort of errors of commission that I've done in like the last decade. And I, I was able to look at like four or five specific trading moments where I was like, "Wow, what did I do that for?" And I came away with two things. One was, if I confuse an investment with a trade, I'm done for. Meaning like there are things that you invest in that you just want to own forever, and then, then there are things that are trades that are just speculative. And, you know, at the end of the day, you have a sense that it could be up in the short term. If I confuse those two, I've made huge mistakes. And then the other one is, I would always get really emotional and panic at the lows. And so I was like, you know, in early December or November when I wrote that letter on Twitter, and we talked about it, and I sold a bunch of stuff after Jeff and, and Elon were selling, raised some cash, and I was like, "Okay, now I have enough buffer here. The whole point from here on out is to basically like insulate myself from my own emotional turmoil (laughs) as stocks go down." (laughs) And so far, so good. And my litmus test of when I go home, uh, at the end of every day, y- you know, I check in with Nat and I'm like, "Am I an asshole?" (laughs) 'Cause if I... When I get-

   14. JCJason Calacanis3:40

       She's like, "Yes, what does that have to do with investing?" (laughs)

   15. CPChamath Palihapitiya3:42

       ... when I, when I get crushed in the market, I tend to, I tend to take it out on my friends and my loved ones.

   16. JCJason Calacanis3:47

       Yeah, we know.

   17. CPChamath Palihapitiya3:47

       Honestly, because I, I'm just- (laughs)

   18. JCJason Calacanis3:48

       We're your friends. We know.

   19. DSDavid Sacks3:49

       (laughs)

   20. JCJason Calacanis3:49

       We come to your poker game when your stocks are down, (laughs) and you're just like-

   21. CPChamath Palihapitiya3:53

       Oh my god.

   22. JCJason Calacanis3:53

       "That's it. Run it once. That's it. I'm popping the glides up. I can't take it anymore."

   23. DSDavid Sacks3:57

       Do you remember last year, Chamath, during the, uh, the market collapse, uh, when, at the start of COVID, and you decided you didn't care about having nice jeans anymore? And then you fast-forwarded to December, and you were-

   24. CPChamath Palihapitiya4:09

       (laughs)

   25. DSDavid Sacks4:09

       ... proclaiming the virtue of a $5,000 fresh alpaca sweater or whatever?

   26. CPChamath Palihapitiya4:14

       (laughs)

   27. JCJason Calacanis4:14

       (laughs)

   28. DSDavid Sacks4:14

       I think, I think another, another indicator of sentiment in the market for you is your clothing, um, yeah-

   29. CPChamath Palihapitiya4:19

       Oh my god.

   30. DSDavid Sacks4:20

       ... uh, choice, but-
3. 15:20 – 39:16

   Rising tensions between US and Russia over Ukraine, Putin's demands, NATO negotiations as the underreported key piece, Obama's savvy Russia dealings

   1. JCJason Calacanis15:20

      Speaking of markets, we were on a text, on our text thread talking about if we're about to have the, uh, start of World War III, and then maybe this ha- is not in the news now? I don't... Uh, how do we look at the UK-Russia situation in the Ukraine? Obviously, 100,000 troops are amassing on a border. And what is the goal here? Um, 'cause P- Biden is saying, "Hey, listen, if anything happens we're gonna go (laughs) to war." And there's a lotta saber-rattling here. I don't exactly understand what Putin's goal or motivation is. And that, that's, I think, what I'm not hearing in the news is exactly what is his goal. What, what are your thoughts on what's happening in, uh, the Ukraine and Russia, uh, Sacks?

   2. DFDavid Friedberg16:10

      Okay, well, I think first of all, we have to kind of level set in historical terms about how unusual and unprecedented it would be for us to send troops to fight, you know, potentially Russia in a border conflict with Ukraine. With, and by the way, the, Biden put 8,500 troops on alert for deployment this week. It's really without historical precedent. Uh, during the Cold War, you know, in 1956, Soviet tanks rolled into Hungary to crush rebels there. Eisenhower did nothing. 1968, Soviet tanks rolled into Czechoslovakia to crush the Prague Spring. LBJ did nothing. 1981, the Soviets qua- um, crushed the Solidarity movement in p- in Poland. Ronald Reagan did nothing even though he had campaigned on getting tough with the Soviets. And then in more recently in 2008, when Russia invaded, uh, Georgia, uh, George W. Bush did not intervene militarily. And in 2014 when Putin occupied Crimea, Obama did nothing. And so this idea... And, and the reason for that in all of those cases is because America has a vital national interest in avoiding war with a nuclear armed Russia, and we did not have a vital national interest in defending the territorial sovereignty of those nations. That's the bottom line. And so for us to be now beating the drums of war and talking about sending troops into a war zone with Russia is just, it's unbelievably irresponsible.

   3. JCJason Calacanis17:46

      Friedberg, uh, one might speculate, uh, if they were cynical, some sort of wag the dog situation here. Biden's not doing well, he's lowest popularity ever, midterms are coming up. I- is there any political motivation here do you think in what Biden's actions are? You know, given the context of what F- uh, Sacks just outlined?

   4. DSDavid Sacks18:05

      I, I think that there's, um, this is like showing up to the l- you know, the last 20 minutes of a two-hour movie, and then saying, "Oh my gosh, what's this guy doing? He's so crazy." There's a long narrative that precedes the current news cycle on what's happening with Putin and the Ukraine.... you know, in large part, the United States helped to start the fuel, um, the expansion of NATO in the '90s. And, um, the intention was to make NATO as western allied, uh, kind of organization, contain Russia, step up right to their borders, get very close and, um, and ultimately make these kind of, you know, areas free l- liberal democracies that are aligned with the West, and put them right on Russia's border. And, and that is obviously antagonistic. If anyone tried to do that to the United States, like Russia did with the Cuban Missile Crisis, we would view that as a hostile act and we would react accordingly. And for years, the pressure has been building and, and has been mounting, as Putin had started to kind of solidify, uh, his political power at home and his allies abroad in trying to figure out ways to push back on this wall that has been built around him and his nation. And it... You, you know, to some degree, I think we look at this as, like, his aggressive behavior, but it... To some extent, it is a defensive behavior over a very longer cycle when, when, when viewed that way. And again, like, remember the US had this Monroe Doctrine, um, which President Monroe put in place in, I don't know, 18 something, 1800 something that said, you know, anyone that comes into our territory and tries to influence nations around us to be hostile towards us is, is a hostile act in and of itself. Anytime someone tries to influence our politics, it's hostile. And I think Russia views our behavior and NATO's behavior this way. And so his primary demand is and has always been that the Ukraine cannot and will not and should not join NATO. And the US response has and continues to be-

   5. CPChamath Palihapitiya20:05

      And, and the EU.

   6. DSDavid Sacks20:06

      And the EU. And we're saying, "Look, we, we believe in the sovereignty of the Ukraine, and we want the Ukraine to make their own decision about where they go and what they do." But the reality is, for us, this is a key part of a very long-term strategy to keep Russia contained. Now, meanwhile, there's this beautiful backdrop of what's going on with China. And if I'm China, I would love to see the US and Russia in conflict because it will weaken the US. And if I'm Russia, I would love to see the US and China in conflict because it will weaken the US. The US is in a very precarious situation right now, and for us to actually end up in conflict, it's gonna weaken our position with one of these other two emerging, you know, challenging, you know, superpowers, and this is a, a, a really precarious time. I think to Sax's point, it's, it's highly unlikely we're gonna end up sending military, but the posturing is such that we need to kind of hold our line until the very last minute. We'll see what happens. I did say, you know, at the end of the year, I do think that we're in this kind of economic status right now that if there were an opportunity for conflict, we're probably more likely to want to engage in conflict than not, because it does create something that we all get behind, it creates, you know, kind of a, a political unity, it creates economic unity, it creates driving forces that, uh, maybe might help us through what is clearly a very volatile and difficult time at home. Um, so let's see what happens.

   7. CPChamath Palihapitiya21:23

      I think Obama's already given us the end game. I just think we have to go through the machinations to get there. He said to The Atlantic, I think it was in 2016 or '17, he said, "The fact is that Ukraine, which is a non-NATO country, is going to be vulnerable to military domination by Russia no matter what we do." And, you know, every time there was this brinksmanship, we effectively blinked and rightfully so, because it didn't necessarily make sense to, to all of a sudden engage the war machine to go to war in Eastern Europe. The thing that's interesting about what happened here though was that this was a slow moving train wreck that was really visible years and years ago. Why is that? Well, if you look at what was really happening, this is really a European issue, and you got to think, "Well, why is America being the leading actor here when..." You know, where's Europe in all of this? Well, it turns out that, you know, the strongest power in Europe, Germany is in a really difficult situation because they rely on Russian energy. 50% of, uh, the nat gas that comes in... or 50% of the energy, I think, that comes into Germany is from Russia. And they've in fact been building an entire pipeline system, um, from Russia that bypasses the Ukraine and goes straight to Germany. And so when all of this saber-rattling was happening, Germany basically had to blink because they need Russia's energy. And why did they need Russia's energy? Well, they needed Russia's energy because 20 years ago, the environmentalists in Germany won-

   8. DSDavid Sacks22:51

      Crazy.

   9. CPChamath Palihapitiya22:51

      ... and they started to decommission all their nuclear reactors. (laughs) It's so ridiculous. There was no... So at somewhere along the way, nobody took a science class in Germany (laughs) and figured out that nuclear was both safer and cleaner, instead burning fossil fuels was the answer.

   10. DSDavid Sacks23:04

       And geopolitically wiser to not have a dependency. And after Fukushima, they went, turned them all off. They accelerated it.

   11. CPChamath Palihapitiya23:11

       Yeah, it made more sense to burn fossil fuels, number one, and then to, to get those fossil fuels from Russia. So unfortunately, we are in this state of affairs where, you know, Germany has said, at, at least that's been reported, that they would shut down this pipeline, Nord Stream 2 if, uh, if Russia did something. But the reality is, I think Obama basically told us that, you know, it's gonna be very difficult for us to justify an act like this, especially against somebody who is fortified and clever and smart. This is not like invading the Middle East. And so-

   12. DSDavid Sacks23:41

       This is a master chess player.

   13. CPChamath Palihapitiya23:42

       ... if this, if this happens, the, uh, the stock markets will just go (laughs) absolutely to zero. I mean, if you could have negative stock prices, this may be a good catalyst

   14. DFDavid Friedberg23:51

       We'll pay you to take these Netflix shares, please. (laughs)

   15. CPChamath Palihapitiya23:54

       It's unbelievable. It's re- it's really, really crazy.

   16. DSDavid Sacks23:57

       This is... It seems like a situation where we're assured not to get into, to mix it up with him. Like, I, I don't understand Putin. I don't understand Biden saying that he's absolutely going to react to this, because we're not. We can't afford to get into a war right now. That's right.

   17. CPChamath Palihapitiya24:14

       No, but-

   18. DSDavid Sacks24:14

       And if, and, and if that is true, then, you know, US dominance, the US ability to hold the line starts to decline. And, uh, and that-

   19. DFDavid Friedberg24:23

       Well, I, I don't, I don't, I don't know if I agree with that because-

   20. DSDavid Sacks24:25

       Yeah.

   21. DFDavid Friedberg24:25

       ... um, I think we could defuse this crisis very easily.

   22. JCJason Calacanis24:29

       ... yeah.

   23. DFDavid Friedberg24:29

       Which is-

   24. JCJason Calacanis24:29

       What's the exit ramp? Yeah, tell us.

   25. DFDavid Friedberg24:31

       Well, the, the exit ramp here is, W- what is Putin demanding? Putin is demanding that we affirm that Ukraine will not be part of NATO. In my view-

   26. JCJason Calacanis24:41

       Sure, let's do it.

   27. DFDavid Friedberg24:41

       Na-, in my view, that's giving him the sleeves off our vest, because we should not want to add Ukraine or Georgia to NATO. Uh, that would do nothing to enhance the security of the United States. We wouldn't get anything out of it. But we would be obligated under, uh, Article V of-

   28. JCJason Calacanis24:57

       To defend them. Yeah.

   29. DFDavid Friedberg24:57

       Exactly, to defend them. So, admitting Ukraine or Georgia or Moldova could ultimately bring us into a war-

   30. JCJason Calacanis25:05

       Invite antagonism, too.
4. 39:16 – 55:18

   Bill Ackman buys the Netflix dip, Tesla and Microsoft crush earnings, the Fed signals rate hikes

   1. JCJason Calacanis39:16

      All right, let's go to markets. Um, Bill Ackman, uh, came over the top. He's buying a ton of, uh, Netflix. And Tesla just absolutely flipped to becoming a money printing machine, uh, and had a ridiculous quarter. Revenue's up 53, to 53 billion, up 71% year over year, Q4 revenue, 17 billion, 65% year over year. And they (laughs) increased their deliveries by 71%. And, uh, you know, now you're all of a sudden just starting to see some, uh, you know, income coming into the company. So flipping from money losing to break-even to now printing a ton of money. Microsoft had an absurd quarter. Uh, their revenue hit 51.7 billion, up 20%, uh, in the quarter, 20% year over year. Pays for $200 billion in revenue in 2022. And their net income was also up 20 plus percent at 18.8 billion. So the money printing machine in these companies is just extraordinary. Chamath, what are your thoughts?

   2. CPChamath Palihapitiya40:20

      I think you're, you're, you forgot a couple of key things, which is that the FOMC meeting happened this week and Powell basically said, "Look, we're gonna start tightening in March." I think the way that he said it, you know, all of these words tend to be so scrutinized and overanalyzed, but the, instead of figuring out what people thought, I think their actions post the FOMC are important, which is that, you know, we effectively now started to price in about five rate hikes this year. So probably five 25 point rate hikes effectively. That's what, that's what the, that's what the yield curve tells us. If you take a big step back, I just want to remind people, like, it's really hard to live through volatility, right? And we're in the phase of it now. But typically, these big drawdowns, so like, you know, when stocks go down, it actually precedes, so it comes before, the actual starting of a rate hike cycle. And so if you go back to the, you know, from 1950 onwards to today, every time the government has started to raise rates or the Federal Reserve has started to raise rates, the stock markets have actually rallied. Now, why is that? It's typically that they see through the end of the rate hike cycle and they start to price the business as if these rate hikes are done and to, to, to rebase things. And on average, I think the stock markets go up between seven and 8%, so call it 7.5, 8.5%. And so what's interesting to me is now we're finally starting the process of these hikes, and the real question is going to be, how data dependent do these guys get? And what I mean by that is, so you know, we talked about this before, but you know, China cut rates. This past weekend, actually Germany decreased their GDP forecast. And so you're starting to see two huge countries already say, "Hey, wait a minute. We need to be, you know, we need to be more realistic about what long-term growth looks like here." It's inconceivable in my mind that those countries are slowing down and we won't. And so I think what happens in these other huge GDP drivers of world GDP will affect us. And so, you know, Sax and I have said this before, but the marginal risk will be that we over-correct and actually create a recession that doesn't need to be one. So-

   3. JCJason Calacanis42:32

      We slam on the brakes too hard. And another way of saying it is, the-

   4. CPChamath Palihapitiya42:35

      I, so I don't know.

   5. JCJason Calacanis42:35

      ... rate hikes are, or the market is a leading indicator of what's gonna happen post-

   6. CPChamath Palihapitiya42:40

      ... the rate hikes.

   7. DFDavid Friedberg42:41

      We had a nice relief rally going until, I think some of the words that Powell used was that there was plenty of room for rate hikes.

   8. CPChamath Palihapitiya42:47

      Plenty of room. Yeah.

   9. DFDavid Friedberg42:47

      Meaning that because unemployment's at 3.5%, that, you know, we're at full employment and that means that the Fed can, that, you know, has this dual mission of keeping inflation low and, you know, keeping employment high. So if employment is high, then they've got more room to raise rate. Anyway, it was that language around the plenty of room that freaked markets out and it triggered a huge selloff. I think to Chamath's point, I don't see how you could have this much wealth destroyed so quickly and have it not impact the real economy. There's a lot of people out there who feel a lot poorer because their portfolios have gotten slashed in value. I mean, anybody with-

   10. CPChamath Palihapitiya43:26

       So they'll, they'll tightening, they'll clench, not spend as much money on a vacation-

   11. DFDavid Friedberg43:30

       Absolutely.

   12. CPChamath Palihapitiya43:30

       ... not buy a TV or a car, so these waitlists for cars might get, you know, become ouch.

   13. DFDavid Friedberg43:36

       The luxury markets of the economy, the optional purchases, uh, start to really slow down. And so I think that the risk of recession now is much higher than it was even a month ago. Now, you know, it's gonna be hard to know... So, so basically, I think what we're saying is, it's gonna be very hard for the Fed to engineer a soft landing here, where we don't trigger a recession, uh, in the process of stopping inflation. And, um, look, we'll, we'll judge Powell's performance, you know, at the end of this. You know, we're not gonna know. I think it's... But I, but I think that he's turned out to be much more hawkish in his statements than markets were expecting.

   14. CPChamath Palihapitiya44:16

       Again-

   15. DFDavid Friedberg44:16

       That's pretty clear.

   16. CPChamath Palihapitiya44:16

       And in 2018, you know, he was probably overly hawkish and he actually created, effectively, a little mini recession. We, we didn't pay attention enough to it because, you know, Trump made it impossible to see the signal from the noise, but it did happen and it was Powell being a little too trigger happy. And so, you know, we have to remember that, you know, the Fed has $9 trillion of assets on their balance sheet. And so, you know, if they start to take $9 trillion of cash out of the system by selling these assets into the market, right, you're taking the money out, right, 'cause you're getting money back, that's gonna have an enormous huge impact as well. So if you think about-

   17. DFDavid Friedberg44:54

       Stupid question, Chamath. What happens when that money comes out?

   18. CPChamath Palihapitiya44:55

       One second. Let me just finish. One second. One second.

   19. DFDavid Friedberg44:57

       Yeah, yeah.

   20. CPChamath Palihapitiya44:57

       Let me finish, please. So, you know, so when you have these two things happening at the same time, you have a potential rate hike cycle, which makes the f- the cost of a used car more expensive, the cost of your credit card balances more expensive, the obligations you have to pay just become naturally more expensive. You feel poorer, so you spend less. And then separately, in the financial markets, you actually take liquidity out of the system, um, and so people value, you know, uh, liquidity more. It becomes, it becomes worth more. You pic- You, you value current cash more. I mean, we're putting ourselves in a really delicate position. So he's got a, a, a delicate balancing act here. He is definitely on a tightrope, I think. So if we pull 9 trillion out, we've been talking about this deficit, if he starts selling all of those assets, does that mean on the United States balance sheet, that will reduce our national debt? No. I mean, we're getting 9 tri-

   21. DFDavid Friedberg45:48

       Where does the money go?

   22. CPChamath Palihapitiya45:49

       We're getting 9 trillion of cash, right? You sell an asset, you get cash for it. Right, and so-

   23. DFDavid Friedberg45:53

       So it pulls money out of the economy in the same way that, uh-

   24. CPChamath Palihapitiya45:56

       Pulls money out of the economy. Yeah.

   25. DFDavid Friedberg45:57

       It, it created liquidity when they were, um, buying assets, right? When they were buying th- this debt, it would put mon- push money out.

   26. CPChamath Palihapitiya46:04

       Yeah.

   27. DFDavid Friedberg46:04

       If they're selling the debt, it pulls money back in.

   28. CPChamath Palihapitiya46:07

       What happens to those dollars is my point. Like, what, what is the impact-

   29. DFDavid Friedberg46:10

       The dollars, the dollars stay on the f-

   30. CPChamath Palihapitiya46:11

       ... of those dollars sitting around in the United States Bank account?
5. 55:18 – 1:04:08

   Altos Labs raises $3B in the largest Seed round ever, incredible Yamanaka factors breakthrough, dynamics of a richly capitalized bio-moonshot

   1. DFDavid Friedberg55:18

      prices.

   2. JCJason Calacanis55:18

      I think there's an interesting startup story. Um, there's a private company that's doing essentially life extension that a bunch of rich people put $3 billion into. You wanna tell us, Friedberg, in your science segment what... if it's gonna make us live longer or not?

   3. DSDavid Sacks55:34

      Well, I think I mentioned this company a few episodes ago, uh, but I think they just announced their, um, $3 billion investment. Um, and, and again, this goes back to the, um, the point I made on the prediction show. So last week, Altos Labs announced that they've landed $3 billion in funding, and this has been, uh, an ongoing funding that's been going on for quite a while into this business. But this business was set up, uh, to commercialize Yamanaka factor-based cellular reprogramming, uh, for age reversal. And there was a paper published just yesterday, I'll put a link in the show notes that if people are interested in reading a scientific paper, they can take a look. Incredible results. Scientists took mice, gave those mice short bursts of these Yamanaka factors, and then measured all the biomarkers, all of the chemical signatures in the blood of those mice, to determine their age. 'Cause there are known ways that we can measure the age of an organism by looking in their blood and measuring certain biomarkers. And with just a few short bursts for about a week of these drugs, these, um, uh, these Yamanaka factors, the mice, all of their age signals reversed to making it look like they were very young again. And it did not do what the challenge has been with Yamanaka factors in the past, is if you put too much of it in, in a body, in an organism, the cells rejuvenate to becoming stem cells, which is kind of like w- what a fetus might have, and starts to grow a lot of tumors. They were able to avoid having tumors show up in the mice, and the mice, in fact, all looked extremely young from a biomarker basis. So an incredible result, an incredible paper, whether or not it gets repeated and shown by others, but I think this speaks to the quality of the science that's underlying the $3 billion investment that was just made in Altos Labs, which is probably one of the biggest seed investments ever in, in startup-

   4. JCJason Calacanis57:26

      No, it, it clearly is the biggest seed investment ever in a startup. There are nowhere close.

   5. DSDavid Sacks57:29

      And I think it speaks to what I highlighted as, what I, what, what, what will be the new frontier in biotech and will completely rewrite, like, you know, the course of humanity, is if we can take drugs and, for a short period of time, completely reverse the age of ourselves. And it sounds so crazy and so wacky, but it's being now proven. In, in a single week, we've now had an amazing paper published, and we've seen the startup announce their $3 billion of funding to pursue commercialization of this technology, and this is gonna be the year. I think this will be the front cover of a lot of magazines this, this year, as people realize the, that this is real and that it's getting commercialized. So really excited.

   6. CPChamath Palihapitiya58:02

      Why, why do you think, why do you think they have to start with $3 billion?

   7. DSDavid Sacks58:06

      Uh-

   8. CPChamath Palihapitiya58:06

      And I, and I'll tell you why I ask the question.

   9. DSDavid Sacks58:08

      Yeah.

   10. CPChamath Palihapitiya58:08

       Whenever I see these grandiose prognostications of future progress and then see these companies raise exorbitant amounts of money, I have never found a single example-

   11. DSDavid Sacks58:19

       Never worked.

   12. CPChamath Palihapitiya58:19

       ... where it's ever worked.

   13. DSDavid Sacks58:20

       (laughs) Yeah, right.

   14. CPChamath Palihapitiya58:20

       Ever. In fact-

   15. DSDavid Sacks58:21

       (laughs)

   16. CPChamath Palihapitiya58:21

       ... every time I see a company raise an exorbitant amount of money in a Series A, I write them-

   17. DSDavid Sacks58:25

       Sure.

   18. CPChamath Palihapitiya58:25

       ... off in my head.

   19. DSDavid Sacks58:26

       Yeah, sure. Yeah.

   20. CPChamath Palihapitiya58:28

       So why, why should I not in this case?

   21. DSDavid Sacks58:30

       So-

   22. CPChamath Palihapitiya58:31

       Or it's more, actually, actually, better question, why would somebody listening to this pod go work there and take the Series A offer?

   23. DSDavid Sacks58:36

       Right. So I, by the way, I, by the way, the same has been done and can be said about Calico, which is Alphabet subsidiary that's, that's pursuing similar research, where billions of dollars have gone into that business, and there's a si- a similar sort of research track underway. And I think the general principle, Chamath, is they don't know what the product is, they don't know the way to market, they don't know, you know, um, what area they need to explore, but the underlying principle is proven. The underlying principle is something that people believe in. This science is proven. This science is real. We don't know the commercial path, and we have to try lots of different things and run lots of different research programs in parallel to figure it out. And each of those research programs is like $100 million biotech startup. And so I think the, the, the principle is let's put a lot of shots on goal all at once in parallel and make sure, 'cause if any of these shots on goal work, this is gonna be worth many, many billions of dollars. So I think that's generally the idea. It's almost like having a $3 billion venture fund, but the venture fund is targeted at one core area of interest that we believe is real. And I think that's the way a lot of these things are being set up.

   24. CPChamath Palihapitiya59:37

       But I'm, I'm asking this question. Have you ever seen a company try to do 30 different things and it works?

   25. DSDavid Sacks59:43

       No.

   26. DFDavid Friedberg59:43

       No.

   27. JCJason Calacanis59:44

       Yeah, I mean, it's not the typical capital allocation, milestone-based funding scheme. I have a th- theory about this.

   28. DSDavid Sacks59:50

       But it's not a product market fit thing, right? It's-

   29. JCJason Calacanis59:52

       No.

   30. DSDavid Sacks59:52

       ... it's, it's a, it's a research program, and it's a series of research programs. But I mean, look, it, you, you... L- let me reframe it for you, Chamath. Have you ever seen a $3 billion venture fund that makes 100 bets with smart people at the helm, with smart people working at the individual businesses-
6. 1:04:08 – 1:14:11

   The Stripe Mafia, Bolt CEO punches up, reflecting on old emails

   1. DSDavid Sacks1:04:08

      do hope you're right. But I, I think 00:03:42 ] Jason, when you were talking about talking about startups, I thought we were going to talk about Bolt and the Stripe mafia fiasco this week. Oh, that's a good story.

   2. JCJason Calacanis1:04:16

      It's, uh, a pretty crazy story. Bolt-

   3. DSDavid Sacks1:04:19

      Where does everyone fall? What side does everyone fall on on that?

   4. JCJason Calacanis1:07:06

      ... and that was the big mistake. And Mark Andreessen, Sequoia, a bunch of different venture firms responded. Sacks, what's your take on this? I see you're chomping at the bit, or maybe you're biting your tongue. Which is it?

   5. DFDavid Friedberg1:07:17

      No, I, I, so I agree with Chamath that it was kind of a brilliant PR move, if, if that's what it was. I, I do like startups punching up and he took a punch at Stripe, which is the big company in the space. So... And then, yeah, Stripe, Stripe didn't respond directly, the Colsons didn't respond, but their surrogates did. And then that looks like punching down and it draws more attention to it. So I get the PR strategy. I would say that as to the merits of the allegation, I do, I, I, I, it's interesting that, you know, he didn't get into YC because I think that he is a very talented founder and, um, you know, we, we looked at this company pretty-

   6. JCJason Calacanis1:07:54

      Oh.

   7. DFDavid Friedberg1:07:54

      ... yeah, pretty early on. It was for, like, sort of a mid-stage growth round and it was, like, one of the toughest decisions we, uh, we fa- I'd say the toughest decisions as a VC are when you actually want to invest in the company, but the valuation-

   8. JCJason Calacanis1:08:09

      Hmm.

   9. DFDavid Friedberg1:08:09

      ... is like 2X what you think it should be. And that was kind of the situation at the time when we looked at it, is, I think we actually would have invested, it's just the valuation was too high, so-

   10. JCJason Calacanis1:08:20

       And it would have been a great bet for you.

   11. DFDavid Friedberg1:08:21

       Yeah, he grew into it, and so it would have been a great bet. And-

   12. JCJason Calacanis1:08:24

       So it was a bad decision on your part?

   13. DFDavid Friedberg1:08:26

       Yeah, yeah. Clearly we should have invested. It's just that, you know, at the time you invest, you have to have some basis for valuation. And, and that's the sense in which I think, you know, maybe Ryan's accusations don't totally make sense, is that he's been able to raise a lot of rounds at really high valuations, and so he, he hasn't had a problem, you know, raising a lot of money at, you know, great prices. And, it, you know, it almost feels like a slap in the face to his investors where, like, "What's the complaint? I didn't get any tier one investors." (laughs)

   14. JCJason Calacanis1:08:59

       Or that it was just hard to meet with investors-

   15. DFDavid Friedberg1:09:01

       Yeah.

   16. JCJason Calacanis1:09:01

       ... and that Stripe called the investors-

   17. DFDavid Friedberg1:09:03

       Yeah.

   18. JCJason Calacanis1:09:03

       ... and told them not to invest. That, that was the allegation.

   19. DFDavid Friedberg1:09:07

       Yeah, no, I mean, yeah. I, I, I can't, I can't really speak to that, but-

   20. JCJason Calacanis1:09:11

       Yeah.

   21. DFDavid Friedberg1:09:11

       ... I mean, he was clearly able to raise, uh, great rounds, so...

   22. CPChamath Palihapitiya1:09:14

       Can I read to you an email exchange between me and Ryan Breslow?

   23. JCJason Calacanis1:09:19

       Oh, a dramatic reading? Here we go.

   24. CPChamath Palihapitiya1:09:20

       From 2015?

   25. JCJason Calacanis1:09:21

       Uh-oh, here we go.

   26. CPChamath Palihapitiya1:09:23

       "Hmoth hopes all, all's well. Um, FYI, things felt too rushed on our end, so we're toning down our Series A discussions for a couple of months." And this was, this was in July of 2015. I'm, I'm reading you my answer because it's so fabulous.

   27. DFDavid Friedberg1:09:37

       (laughs)

   28. CPChamath Palihapitiya1:09:38

       "Hi Ryan, after a wholly unsuccessful few weeks of attempting to win a World Series of Poker bracelet, (laughs) I'm back at home licking my wounds."

   29. DFDavid Friedberg1:09:46

       (laughs)

   30. CPChamath Palihapitiya1:09:47

       "How about we talk in a week or two?" So, not only did I have a chance to win a World Series of Poker bracelet, according to this exchange, which I didn't win, obviously.

Episode duration: 1:14:12