All-In PodcastIn conversation with Reid Hoffman & Robert F. Kennedy Jr.
EVERY SPOKEN WORD
150 min read · 30,006 words- 0:00 – 1:48
Bestie intros: Buttons are back for fall
- JCJason Calacanis
Welcome back to the All-In Podcast, the number one business technology and political podcast in the world.
- CPChamath Palihapitiya
Political. (laughs)
- JCJason Calacanis
I am your host, J-Cal, Jason Calacanis, and with us today, three of my besties. You got, uh, David Freiberg cackling over there. He is your sultan of science, previously known as the queen of quinoa, but he sold the quinoa business, made a killing in quinoa. Also with us, back from Italy, back from Italy, Chamath Palihapitiya. He's at 67% buttoned-
- CPChamath Palihapitiya
(laughs)
- JCJason Calacanis
... and, uh, he's not happy about it, but the hair looks great. You still got a little sea salt from the, the yachting you went on over there.
- CPChamath Palihapitiya
I think I'm gonna try to keep my hair long. Let's see what happens.
- JCJason Calacanis
Did you bring any of the sea salt back with you from the Mediterranean, put it in a little bottle to spray or no?
- CPChamath Palihapitiya
No, but I do have-
- JCJason Calacanis
That's it, that's it?
- CPChamath Palihapitiya
... some mineral oil.
- JCJason Calacanis
Oh, okay, great. And have you-
- CPChamath Palihapitiya
So-
- JCJason Calacanis
... showered in the last week, or is it still, you got the Mediterranean glow from-
- CPChamath Palihapitiya
Every day I've showered-
- JCJason Calacanis
... when you were there?
- CPChamath Palihapitiya
... since I've gotten back.
- JCJason Calacanis
See, that's the problem. You were showering-
- CPChamath Palihapitiya
'Cause you don't have-
- JCJason Calacanis
... in the Mediterranean.
- CPChamath Palihapitiya
... you don't have the sea to use as a natural, you know, disinfectant and deodorant. Exfoliant also, yeah. Look how many buttons he's got going. (laughs)
- JCJason Calacanis
I know. It's just tragic.
- CPChamath Palihapitiya
The fall is beginning. I feel uncomfortable for your neck. I mean, it's like-
- JCJason Calacanis
(laughs)
- CPChamath Palihapitiya
... creeping all the way up.
- JCJason Calacanis
(laughs)
- DSDavid Sacks
What's going on?
- CPChamath Palihapitiya
Your neck looks like a prisoner.
- DSDavid Sacks
What's going on? Let your winners ride. Rain Man, David Sachs. What's going on? And I said we open source it to the fans, and they've just gone crazy with it. Love you guys. Queen of quinoa. What's going on?
- CPChamath Palihapitiya
I walked here, but I had it totally unbuttoned, and I thought, "This is completely inappropriate for Menlo Park-
- JCJason Calacanis
Hmm.
- 1:48 – 7:52
Reid Hoffman joins the show, reminiscing on PayPal stories with Sacks
- JCJason Calacanis
we have a bestie guestie for you folks, friend of my other pod, This Week in Startups, Reid Hoffman is here, and, uh, you know him as a venture capitalist board member at Microsoft, and you were the co-founder or the founder of LinkedIn. I don't know if you had a co-founder.
- CPChamath Palihapitiya
Co-founder.
- JCJason Calacanis
Co-founder of LinkedIn, uh, now owned by Microsoft. He's got his own podcast, Masters of Scale, and, uh, h- he and David Sachs worked together at PayPal. Reid, give a... Welcome to the program, and, and give us a little story. What is your fondest memory-
- CPChamath Palihapitiya
(laughs)
- JCJason Calacanis
... or the most quirky memory-
- CPChamath Palihapitiya
(laughs)
- JCJason Calacanis
... David Sachs-
- CPChamath Palihapitiya
Mm-hmm.
- JCJason Calacanis
... and that, all those weirdos... I'm sorry. I'm not supposed to use the word weird anymore. I'll get banned on X. All of those unique personalities at PayPal. Tell us about that moment in time, and do you remember the first time you met David Sachs?
- CPChamath Palihapitiya
Yeah, I met, um, David, uh, 'cause Peter had known him from Stanford and hired him in, um, and, you know, David, uh, very quickly, 'cause he, you know, uh, has a, has a strong learning curve as he plays these things, kind of got the instinct of what the game we were playing with PayPal was. And it's part of the reason why I think, you know, each of the execs have had, you know, kinda key contributions to making, um, you know, kind of PayPal successful. And, and David's was this kind of, like, um, maniacal focus on the, kind of the, the cycle of how the product worked on eBay. Um, and, like, like, there was just a whole bunch of stuff I learned from him. It's part of how I track, you know, kind of, you know, people I respect, is, what do I learn from them?
- JCJason Calacanis
Hmm.
- CPChamath Palihapitiya
And that was one of the things that I would say I learned from, uh, David at PayPal. That's nice.
- JCJason Calacanis
David, tell us your first memory of meeting Reid Hoffman. Would you remember where you were? Do you remember the conversation? And, yeah.
- CPChamath Palihapitiya
Yeah, I think, well, we met through Peter, you know, and Reid-
- JCJason Calacanis
Hmm.
- CPChamath Palihapitiya
I think Reid was on the board of this Confinity back then, and then joined full-time.
- JCJason Calacanis
What were you, like 28, 27, 29?
- CPChamath Palihapitiya
No, I mean, let's see. Um, this would've been- It's 2000. I, I guess I would've been 27 when I first joined PayPal, 27-
- JCJason Calacanis
Hmm.
- CPChamath Palihapitiya
... 28, I guess something-
- JCJason Calacanis
Oh. (laughs)
- CPChamath Palihapitiya
... like that. Yeah. '9- '99, so whenever that was.
- JCJason Calacanis
Yeah.
- CPChamath Palihapitiya
In any event, I mean, I'll just, to return the compliment, uh, you know, PayPal had all these existential issues where you had these larger entities trying to kill us, Visa, Mastercard, eBay. Who else?
- JCJason Calacanis
(laughs) Oh, the, the list goes on. Citibank.
- CPChamath Palihapitiya
Ye- yeah.
- JCJason Calacanis
(laughs)
- CPChamath Palihapitiya
And, uh, R- Reid, uh, was, was kind of our emissary who kept all these dogs at bay and managed to, I guess, be friends with them, I guess, to some degree, even though they wanted to kill us. And Reid was kind of in charge of making sure that these existential issues didn't blow up on us. And they didn't, so we got pretty lucky there. It's, it's the Will Rogers line. It's, "Politics is the art of saying, 'Nice doggy,' while you hunt for a stick."
- JCJason Calacanis
Tell us, like, uh, a moment, Reid, that is incredibly memorable to you from that PayPal era, f- you know, some existential moment or one of the more difficult or funny moments, late-night moments, uh, that would be indicative of that era and whatever was in the water that drew all that talent to one place.
- CPChamath Palihapitiya
Well, part of it is that, I mean, this is, you know, among the things I was learning from, from Peter, was that Peter and Max, uh, recruited just a tremendous focus on, on, uh, like, intense learning curves. So, you know, it was one of the things that Peter later was like, "Okay, I guess you have to interview for being on sports teams and so forth 'cause this teamwork thing does matter," but, like, high performers, and it was kind of like a, a, like... and that was part of the reason why there was such intense, um, you know, kind of, uh, innovation and capability. Um, you know, (laughs) probably the most stunning memory I had at, at, at PayPal is we... you know, we were all young. We're all, first time we're, we're kind of doing a startup that matters, you know, kind of, uh, making this stuff happen, and we do this merger with X.com.... and, and, you know, like pre the merger closing, you know, Elon is, is saying, "Oh, I got this CEO Bill Harris. He's the best ever. That's part of the reason why you should give so much percentage of the company to x.com in the merger." You know, da da da da da. And then after, um, the merger, literally the first meeting I had with Elon is, "Bill Harris is a complete disaster. We need to fire him right away."
- 7:52 – 19:51
State of AI: Nvidia, cluster buildouts, competition
- JCJason Calacanis
we just got results, Reid, uh, from NVIDIA. Results were good, they beat across the board. Stock was down after hours. Analysts said probably profit-taking. Putting that aside, we've never seen a chart like this in the history of, uh, business, I would say. Data center revenue, 26.3 billion, 87% of their revenue now. You remember NVIDIA started obviously with, you know, video games and, and, uh, didn't have a major data center business. That has exploded. Uh, net income of 16.6 billion, gross margin (laughs) 75%. And, uh, here's your chart. On a total basis, NVIDIA's revenue scale-up is basically unlike anything we've seen. But if you look, their q- quarter over quarter revenue over the past couple of years, things are starting to cool off significantly after that giant boom. Reid, what's your take on NVIDIA's just incredible run here? Is it sustainable? Will they have competitors and do you think this buildout, this massive buildout we're seeing from startups to sovereigns, you know, to Microsoft, which you're on the board of, Google, Apple, et cetera, is this sustainable and is this gonna keep going?
- CPChamath Palihapitiya
Well, I got asked that question, unsurprisingly, by l- many public market investors over the year.
- JCJason Calacanis
Yeah.
- CPChamath Palihapitiya
And I said, I basically told them, I say, "Hey, look, it's sustainable for two years. Which for you guys means forever." (laughs)
- JCJason Calacanis
(laughs) Yeah. Eight full quarters.
- CPChamath Palihapitiya
(laughs) Yes, exactly. So that, that's infinity, right? In terms of time. Uh, you know, uh, NVIDIA has a very sharp, you know, kind of lead on the importance of the, you know, the chips for the training clusters, um, you know, they're, they're effective on inference. Um, but I do think that as you kind of scale the demand, there'll be a lot of inference chips, uh, coming in. Um, you know, I think Chamath, you're invested in one of those?
- JCJason Calacanis
Oh, yeah.
- CPChamath Palihapitiya
Um, and, um, I think there's gonna be a bunch of those kind of coming in and, and, and the bulk of the demand will be on the inference side, and then NVIDIA will have this challenge of, "Do I try to keep my prices and my margin-"
- JCJason Calacanis
Hmm.
- CPChamath Palihapitiya
"... or do I do what, why we like competition, do I have to respond to the competitive market?" And then that, I think will, will play out, you know, start playing out probably in a year, two at the latest, and then kind of go. So I think it's not sustaina- the, the, the pure heat is not sustainable, um, but I think it's, you know, NVIDIA's got a very strong position and, and, um, you know, I definitely, I would recommend people not be short on NVIDIA-
- JCJason Calacanis
Yeah.
- CPChamath Palihapitiya
... today.
- JCJason Calacanis
So, yeah. There's growth left, competition is coming, and this is probably not the type of stock you would want to short at this moment in time.
- CPChamath Palihapitiya
Yeah.
- JCJason Calacanis
Uh, Friedberg, what are your thoughts on this buildout, uh, as well as the software buildout that's occurring, and when do you think we're gonna see some competition come into the space? I don't know if it's competition in the buildout. I think we talked about this in the past. I don't know if you guys saw these quotes this week or recently on, "We don't think about this buildout in terms of ROI." Gavin Baker in conversation on, uh, Invest Like The Best, is that the name of the podcast? Yeah. I think referenced some conversations he's been having with the leaders of these companies regarding the buildout is so important because ultimately if you create this "digital god," the, you know, return is how many trillions? So it doesn't matter how many tens of billions you're spending each quarter right now, you have to get there, you have to make sure you don't miss the boat. I guess, Reid, a question for you. You're on the board of Microsoft still, right? Like-
- CPChamath Palihapitiya
Yes, indeed.
- JCJason Calacanis
... has Microsoft or Satya publicly talked about how they rationalize the investing principles associated with building out AI infrastructure in the cloud? Is it ROI-based, like, "Hey, in the next two years we're gonna make this much additional incremental-"
- RHReid Hoffman
Right, or, or, or-
- JCJason Calacanis
"... operating profit?" Or, or is it like-
- RHReid Hoffman
... two more preci-
- JCJason Calacanis
... "Hey, we gotta get this thing working." Yeah.
- RHReid Hoffman
Right, right. To be more precise, is the investment driven by ROI or does everyone just say, "This is so strategic, we just have to win it and we'll throw all the resources we have to at this"?
- CPChamath Palihapitiya
Well, so, um, what, well, one, board members speaking for Microsoft is-... you know, is for- forbidden. So I'm not speaking for Microsoft-
- DFDavid Friedberg
Right, right, right, right.
- CPChamath Palihapitiya
... just speaking for me. Um, two-
- DFDavid Friedberg
I guess, yeah, all, all cloud computing platform companies-
- CPChamath Palihapitiya
Yeah.
- DFDavid Friedberg
... how are... Yeah, what's your sense on how they're thinking about it?
- CPChamath Palihapitiya
It's just one of the principles in the Microsoft thing-
- DFDavid Friedberg
Right.
- 19:51 – 29:09
OpenAI's corporate structure and thoughts on Elon's lawsuit
- DFDavid Friedberg
Yeah.
- JCJason Calacanis
What is your take on IP in this new era? We, uh, see OpenAI... You're not on the OpenAI board-
- CPChamath Palihapitiya
No.
- JCJason Calacanis
... anymore, right? You're-
- CPChamath Palihapitiya
Nope.
- JCJason Calacanis
So you're independent of that even though you made a, a big donation at some point.
- CPChamath Palihapitiya
Donation-
- JCJason Calacanis
How did you know?
- CPChamath Palihapitiya
... and investment. I led the, the first commercial series, first commercial round.
- JCJason Calacanis
Got it.
- CPChamath Palihapitiya
Yeah.
- JCJason Calacanis
So you were an investor in it, and you donated to it.
- CPChamath Palihapitiya
Yeah.
- JCJason Calacanis
Well, actually, let's start there. What's up with that corporate structure? How do we make sense of that? Something's a nonprofit. You donated to it, and then you invested in it, and everybody's making money and selling and secondary at 100 billion. How does that work in the world?
- CPChamath Palihapitiya
So, um, so it's, it's a 501 (c) (3) is the governor thing. That's what started. And, you know, when, you know, kind of Elon and Sam were starting this and said, "Look, we need, you know, philanthropic support, and we're, we're trying to make sure that there's, like, open access to AI which is gonna be an instrumental technology, and we've got some great technologists who wanna come do this," we started as a, as a, you know, kind of as a 501 (c) (3) for doing it. That, that, that persists, as far as I know, till today. Then, you know, one of, of Sam Altman's, you know, pieces of genius was that he kinda said, "Look, we're gonna need scale capital, and I'm trying to go out to raise..." and the commercial round was 600 million, "I'm trying to raise 600 million in philanthropy, and it's not working," (laughs) right? So, so I have this idea which is the 501 (c) (3) which is doing this kinda research mission of, you know, AGI for humanity. It's also producing commercial benefits, and we can create initially an LP which has a, a kind of a, a, a, a revenue right on the commercial things that investors can invest in. And, you know, um, you know, Reid, it'd be really helpful if you led this, um, because, you know..." And I was like, "Well, but you don't have a go-to-market plan. You don't have a product plan. You don't have a business plan." (laughs) He's like-
- JCJason Calacanis
Yeah.
- CPChamath Palihapitiya
... "Yeah, but, you know, like, we, we need to show that we're actually serious about the business." And I said, "All right, fine. I will, I will lead it from my foundation," um, you know, 'cause even though none of these things we like to see as investors were there. But I was like, "Look, okay, I'll lead it as an investment, I'll manage it as an investment, but I'll do it as an investment from my foundation, um, in order to do this." And, um, and what, you know, you know, kinda that was kind of as we were beginning to get into, you know, like kind of... We, we hadn't seen anything. They were still doing DOTA and, and robot hands and a bunch of those. So it was like we're betting on the scale thesis of generating something magical, and so we hadn't seen GPT-3 yet. Um, and of course, once that started coming, then it was like, "Well, we need a bunch more capital. Let's do a strategic, you know, um, you know, connection, and let's talk to all the hyperscalers, and let's work out a deal by which one of them invests in us." And, and, and then, you know, the, the Microsoft-OpenAI deal came together with, you know, converting the LP into a subsidiary of the nonprofit, you know, kinda saying, "Look, um, there's all kinds of benefits that both OpenAI and Microsoft can get from a business deal." Um, and so that's, that's, that, that's what's led to, you know, the structure, um, you know, that I was familiar with-
- JCJason Calacanis
Reid-
- CPChamath Palihapitiya
... before I left the board.
- JCJason Calacanis
Do you... What did you think of Elon's first lawsuit, and then he dropped it, and then he refiled? Where, where do you think he's coming from?
- CPChamath Palihapitiya
Well, um, (laughs) what i- what is the, uh... You know, I, I'm not very charitable about those lawsuits. Um, you know, I would like to be 'cause, you know, Elon's one of the entrepreneurial heroes of our time and generation. But I think it's the, I think it's, y- you know, frankly, I think probably the most charitable thing to say is sour grapes, um, because, you know... For example, I know Sam offered him as much of the investment round as he wanted, right? Like, he could've done the whole thing. He could've let it... (laughs) You know, it was kinda like, "Hey, look, we still love you. We still..." And he was like, and he was like, "No. It's not a company that I control. It's gonna fail, so I'm not interested in investing." And I was like, "Okay," right? (laughs) And so now you're getting these lawsuits that are like, you know, um, like, "I was misled," and it was like you were offered everything at every opportunity other than converting OpenAI into a company that you, you completely owned. And so, um, you know, I think it's without, without basis, without merit.
- JCJason Calacanis
But why do you think he would have dropped it and then refiled? Where do you think that comes from? Is, was there... is there new information, do you think or-
- CPChamath Palihapitiya
I think it was a jurisdiction issue, Jamal. Oh, that makes sense. I, I didn't check that.
- RHReid Hoffman
Yeah. But Reid, I mean, Elon put in the first, what, $44 million, and he doesn't have any shares.
- CPChamath Palihapitiya
Yeah.
- RHReid Hoffman
I assume you're-
- CPChamath Palihapitiya
And I, by the way, I put in $10 million at the same time, and I don't have any shares from those $10 million.
- RHReid Hoffman
But do you think that he kinda got screwed because he doesn't have any shares? I mean, at the time he put in the $44 million, it was never gonna be a for-profit. Now it's a for-profit. A lot of people are profiting, you know, assuming the Papermark ends up being realized. So he doesn't own anything. I mean, if you were-
- CPChamath Palihapitiya
Yeah.
- RHReid Hoffman
... this seed investor and put up $44 million in something and then everyone's making money and you don't have any shares, forget about the legal technicalities, wouldn't you have a feeling of being screwed?
- 29:09 – 41:27
Inflection AI's deal structure with Microsoft, Lina Khan's impact on the tech industry
- CPChamath Palihapitiya
- JCJason Calacanis
Before we move to politics, I just wanted to actually ask you about Inflection. S- so is it still running?
- CPChamath Palihapitiya
Yeah.
- JCJason Calacanis
And so what basically happened? There was like some transfer payment from Microsoft and couple other people like... And then it seems like whatever that deal was, a little bit seems to have been copied by Google when they did this character.ai thing. So just trying to get a sense from you, are these deals to structurally avoid FTC scrutiny in terms of the building blocks of it? Or how, how did you think about it, and what is the, what is the pattern and the trend on these things?
- CPChamath Palihapitiya
Well, the thing I think that's happened was, you know, very early days, you had things like, you know, we're doing an agent, and if Pi had launched before ChatGPT, it'd probably be in a different circumstance. But like ChatGPT got the, "Oh my God."
- JCJason Calacanis
I'm sorry, Pi? Pi is the Inflection AI product. Yeah, yeah.
- CPChamath Palihapitiya
Pi is the Inflection agent, yeah. And so, so by the time that Pi w- w- we got the, the, the trend right and the, and the interest of the market right, but we got the timing, you know-... too late. Happens with startups. So it was like, okay, we need to pivot. We need to pivot from a B2C model to a B2B. And we have a unique model, but let's sell that to other people who already have audiences because we're not gonna be able to easily grow our audience. And then, you know, once we had that as a conversation, there were employees who were like, "Well, we wanna do the direct agent thing, and that's what we wanna do, and maybe we'll go somewhere in order to do that." And we're like, "Okay, how do we fund this, and how do we make that work, and how do we make it work for investors?" And we said, "Hey, there's a deal structure that could work," which is, you know, with a, you know, kind of outside party, you can get paid enough in a non-exclusive IP license and an ability to selectively hire folks, and then you can dividend some of that out to investors so investors, you know, get back a, you know, kind of a one X, um, and then kind of a, a, a ongoing position. So, you know, as investors, it's great to have a kind of optionality on this B2B business, um, in order to play that out. And this is a structure that works for everybody in this pivot to B2B. And that's essentially the, the, the structure that we did.
- JCJason Calacanis
I see. Great pivot, Chamath, into Lina Khan. I think (laughs) one of the things that is quite paradoxal- paradoxical about your relationship with David Sacks is you both agree on something in politics, which is Lina Khan. And her concepts around future competition and maybe how she's running, uh, this issue for the United States is leading to basically a freeze on the market. We're seeing weird deal structures, like some of the ones we're talking about here that could have just been acquisitions. And I'm curious your thoughts on what she... you know, this sort of breakup of Google. Now, we're seeing that emerge at the same time that they're facing the biggest existential crisis (laughs) of their career, which is language models competing with them. And man, I would say half of my Google searches have already moved to, you know, uh, you know, ChatGPT-like services. So what's your take on Lina Khan's approach to M&A, and what impact, if it's continued and sustained, will that have on capital allocation? Because I, I, I don't know what happened to the single and double M&A (laughs) market, but it seems to be completely gone. Everything from Adobe and Figma to other, uh, mergers that could be happening are essentially frozen. So what's your take?
- CPChamath Palihapitiya
So it was funny, 'cause I kinda made an off-the-cuff, you know, kind of remark about Lina Khan which turned into a whole news cycle. Um-
- JCJason Calacanis
I, I saw you on CNN where they were like, "Are you telling Kamala and Biden-"
- CPChamath Palihapitiya
Yes, yes. (laughs)
- JCJason Calacanis
"... what they have to do?" And it's like-
- CPChamath Palihapitiya
And I'm like, "No, because I don't believe in that kind of corruption of, of, of politics." The only way she's gonna learn about it is either she asked me or she watches this television show. Um, and, um, and so, so she's done good job on the price cartels. She's done a good job on the anti-competes, both of which I think are very good for, you know, competitive markets. The problem is, I think she has a misunderstanding of these, uh, large tech companies. And, um, for example, on the M&A thing, you know, her theory is you gotta prevent the aggregation of power, so you gotta pre- you gotta fight every acquisition of... No. And the problem, of course, is that actually quells venture capital investment, 'cause it's like, okay, um, part of the re- the returns is if I'm gonna invest in something that might be competing with, you know, w- one or more of the large tech companies, I need to have acquisition exits as part of being able to, to fund enough capital to really make that acquisition, you know, that, that, that, that investment possibly work. 'Cause if it doesn't work, I wanna be able to at least return, r- recover my capital by an investment. So the right way to look at it is, is there competition amongst the top tech companies? Because, you know, if one of them is, like, squashing all the other ones, that's a problem. If we're, if we're five large tech companies heading to three, then I'm much more sympathetic to her point of view. But we're actually five heading to 10, right, or five to seven heading to 12, because, like, NVIDIA is now in the mix and, and others, I think, are coming in the mix.
- JCJason Calacanis
Tesla is, you know-
- CPChamath Palihapitiya
Yes.
- JCJason Calacanis
... now over 500 billion. Yeah, so.
- CPChamath Palihapitiya
Yes. And so you, you have this ability. So the thing is, is they're competing on the acquisitions, just like they're competing in the micro- uh, in the marketplace. And if you're trying to quell the whole thing 'cause your theory is, like, like, they should just, you know, the startup should just be able to grow up to compete, that actually means that they'll never get the capital that they need in order to do that, which means you're actually having the opposite of your intent, right? What you're doing is you're actually making there to be less competition because, you know, capitalists can't say, "If I'm gonna put 100 million, 500 million, a billion dollars into this company, I at least have a chance of getting my capital back, or I can possibly create a competitor." And that's, that's the reason I was speaking out against it as an expert. Um-
- JCJason Calacanis
It was, like, interesting-
- CPChamath Palihapitiya
... that's, that's-
- JCJason Calacanis
... you... I, I saw you... I think it was Jake Taper, Tapper who, uh, you-
- CPChamath Palihapitiya
Yeah.
- JCJason Calacanis
... you, you kind of grilled you on it. I thought you did an exceptional job of just saying, "Listen, I made a donation. This is how I feel about it." But obviously she's gonna do what she wants to do, and, and that's just how politics work. So, uh, I thought that was actually pretty well done, and I actually appreciate you fighting for more M&A because it would be great for the industry. Sacks, you wanna-
- CPChamath Palihapitiya
Well, yeah.
- JCJason Calacanis
... you wanna throw up a, a political topic here, or you want me to
- RHReid Hoffman
Oh, no. Just to, just to stick on Lina Khan for a second.
- JCJason Calacanis
Sure.
- RHReid Hoffman
So I, I agree that her approach has been, uh, overly broad and has had a chilling effect on M&A. And so, J-Cal, like you said, we've lost those base hit acquisitions that I think are important to the venture capital market that help new startups get funded. I mean, if the returns on risk capital go down, there's gonna be less of it. That means-
- JCJason Calacanis
And founders, right?
- RHReid Hoffman
... there'll be less-
- JCJason Calacanis
Founders get those single indents.
- 41:27 – 52:02
Reid's perspective on Kamala being hot swapped for Biden, funding groups that attempted to keep RFK Jr. off ballots
- JCJason Calacanis
A few weeks ago, you said something to the effect very publicly that you had had a one-hour or multi-hour lunch with Biden.
Mm. Mm.
And he just seemed-
- CPChamath Palihapitiya
Multi-hour.
- JCJason Calacanis
... like, super on his game, and then he was kind of dumped. Was that just a moment in time where he was really great with you, or how do you reconcile that with Pelosi and all of these other folks and what happened to Biden?
- CPChamath Palihapitiya
Well, like most of us, um, I was pretty dismayed by the debate performance, um, because when I talk to him, like, detailed thoughtful analysis with no notes on Gaza, questions about AI, you know, and what kinds of things, you know, what did I think about what the progress, you know, the thing they were doing with the voluntary commitments and the executive order and, you know, what kinds of things should happen in the future and all that kinda stuff, being on the game. A little slower, right, than, than, you know, a, a 50-year-old would be, but, but, you know, like, cogent and totally worth it.... and then you kind of, uh, looked at the debate thing and went, "Oh my gosh. This is, this is, this is a disaster." Um, and so, um, it was like, look, is the debate a one-off thing? Is it... Did you, were you ill? (laughs) You know, like trying to reconcile the two and, you know, spend a little bit of time trying to figure that out, uh, to, to what was going on because it was, it was the first time I'd seen something like that. And, you know, um, you know, I don't, you know, I'm not enough of a DC insider to know exactly what the set of conclusions were other than I, you know, I applauded, you know, Biden for having the kind of integrity to go, "Look, I'm, maybe I'm ill, maybe I'm old, maybe I'm slower, but, you know, the, the, it's about the country more than it's about me because I'm, you know, not..." Um, you know, it's, it's, it's important to be about the country, not about yourself. I'll, I'll step aside. And ultimately, it was his decision. There's nothing that anyone could force. Pelosi couldn't force it, anyone else. It's ultimately his decision. He came to that decision. So, um, you know, I applaud that.
- JCJason Calacanis
Do you, do you think that they should have run an open primary after that? And would Kamala have won an open primary?
- CPChamath Palihapitiya
Well, it's hard to know. I mean, I think they were definitely leaning towards an open primary, and then all the people who would be the most natural contenders all endorsed Kamala. So, um, and by the way, you say, well, kind of democratic process. It was like, well, there was a democratic process that picked the Biden-Harris ticket, which turned into the Harris-Walz ticket. And so that's not anti-democratic. But I think if you look at the sequence of events, it was kinda like, well, you know, we're, we're gonna sort out, you know, what, what we're gonna do, and then, you know, all of the key folks, you know, Shapiro and, and Whitmer and everyone else all endorsed Kamala. And it was like, okay, let's just, let's get back to, you know, kind of the, the choice of two candidates. And so I, you know-
- DFDavid Friedberg
Do you feel the voters felt-
- CPChamath Palihapitiya
... yeah, I th-
- DFDavid Friedberg
Uh, Reid, do you think the voters felt left out?
- CPChamath Palihapitiya
Um-
- DFDavid Friedberg
The Democratic, um, voters.
- CPChamath Palihapitiya
Well, I mean from post-fact, seems not, right?
- DFDavid Friedberg
Yeah.
- CPChamath Palihapitiya
With the level of kinda energy and all the rest, it seems that, that, that, um, um, that the, uh, that, you know, like the, the, with the pure polling and kinda level of energy and kinda what's going on, um-
- DFDavid Friedberg
They're happy with what they got.
- CPChamath Palihapitiya
Yeah, they're happy with what they got.
- DSDavid Sacks
I would have liked to have that speed run.
- DFDavid Friedberg
Do you think it sets a bad precedent that there were these backroom conversations? Obviously, the staff of Whitmer, Moore, Shapiro, their office speaks with Democratic Party leadership, speak with big donors, and there was effectively a coalescing that took place over a period of time that said, "We should all stand behind and endorse one person instead of infighting and creating a split in the party." And does that not set a bad precedent that there is a small group of people in either party that, in a primary process, effectively get to nominate their candidate, get their candidate to become the nominee, and therefore there's only two people for the country to choose from? And as we have seen recently with RFK Jr. and the lawsuits against him-
- CPChamath Palihapitiya
Hmm.
- DFDavid Friedberg
... in being on the ballot in different states, it makes it very difficult maybe for the people to have their choice. And is that a bad way for democracy to work? And I just love your philosophical view on this.
- CPChamath Palihapitiya
Hmm.
- DFDavid Friedberg
On like, what's the best way for democracy in the United States to work?
- CPChamath Palihapitiya
So, I mean we do live in a rep-
- DFDavid Friedberg
For the president, for the president, for the president.
- CPChamath Palihapitiya
Yes, we do live in a republic, right?
- DFDavid Friedberg
Yes, right.
- CPChamath Palihapitiya
And there, there is various, like, you know, some people have much more influence than others, um, whether it's media platforms, whether it's, um, you know, m- economics and ability to spend, whether it's, you know, history and a brand and, and, and other things. And so, you know, this melee and, and, and kind of, you know, whole integration set of things. Now ultimately, you know, voters are gonna decide in November (laughs) , right? So, you know, people do have a, you know... And I think that, that, that staying to our democratic process is what's really key. Like, you know, people going to the polls. You know, I think we should wanna live in a country where everyone does, you know, everyone who is, uh, who is legally allowed to vote does vote. Um, and I think that that's, you know, ultimately a good thing. Now, you know, are there things that I would like to change? Sure. I'd like to change... I'd like to have ranked-choice voting.
- DFDavid Friedberg
Mm-hmm.
- 52:02 – 55:03
Reid's thoughts on growing antisemitism
- JCJason Calacanis
It's more of a statement actually. Maybe I'd just love to get your reaction.
- CPChamath Palihapitiya
Hmm.
- JCJason Calacanis
One of the most divisive issues that we have right now is people's position on October 7th, Israel-Palestine. There is a sense that there's a growing kind of like virulent strain of antisemitism in America. A lot of people point to the extreme left as where that's really gestating. There was thoughts that Josh Shapiro would have been an exceptional candidate, but one of the large reasons why he was not really meaningfully considered was his religion. I just want you to comment on the broad issue and whether you see it in the Democratic Party, whether you see it in the Republican Party, whether you see it at all. Just give us a sense of where we stand culturally on this issue.
- CPChamath Palihapitiya
Well, so like I know Josh Shapiro. I think he's great. Um, you know, I've had... I've broken bread with him, um, and, you know, he was meaningfully considered. Um, you know, I think that the, um... You know, I think we should be so lucky that he would, you know, run for presidency someday, uh, some year. Um, you know, I didn't... actually didn't know Walz at all, and, and, and, you know, was initially kind of surprised 'cause, you know, I was like, "Oh, I thought it was probably gonna be Shapiro." And then I was like, "Well, you know, I think it was, you know, probably a close call down to those two," and, and it looks like, you know, you know, in making decisions, I think, uh, you know, Harris, you know, made a good decision with Walz. So, you know, I think it's a... Um, you know, now on the, on the antisemitism topic, I do worry that, you know, broadly, um, we're seeing, you know, kind of more rise of antisemitism, and that's extremely important to fight, um, you know, 'cause I think... And I think there are people on... in the... You know, it's a- it's a weirdly like, like, uh, there's some lefties who are doing it and there's some righties who are doing it. It's both a blue and a red issue in different, different shape. And I think it's very important that we, you know, we stand against that, uh, as a country. And so, um, you know, I've been, uh, you know, kind of mostly just trying to say, "Hey, look, we gotta, we gotta be anti- an- anti-racism, antisemitism, and also anti-genocide, and we gotta figure that out."
- JCJason Calacanis
What did you think of Kamala's, uh, handling of that issue in her speech? She basically seemed to, I don't know, say both sides it, but she said, "Hey, you can..."... uh, believe that the people of Gaza should be treated more humanely and that, uh, you know, Israel has a right to defend herself.
- CPChamath Palihapitiya
Yeah.
- JCJason Calacanis
What'd you think of her handling of that?
- CPChamath Palihapitiya
I think that's rational, right? Like, you should be anti-genocide, both of Palestinians and of Jews (laughs) , right? And, and, like, like, it's obviously a very, very thorny topic.
- JCJason Calacanis
Yes.
- CPChamath Palihapitiya
Right? So, um, so I think, you know, saying that I'm gonna try to protect civilians on both sides, anti-genocide, I think that's a human, caring qui- place to be, looking out for people.
- 55:03 – 1:04:19
Thoughts on Kamala's economic proposals: price caps, wealth tax, etc.
- CPChamath Palihapitiya
- DFDavid Friedberg
Reid, do you think that, generally speaking, Marxist, socialist principles are taking a firmer hold on the, the, the Democratic Party and kind of those principles are starting to showcase, not just in the cultural phenomena that, that Chamath is referencing, but also in some of the policymaking that's going on? And, um, concepts of equity rooted in concepts of social justice, ultimately rooted in Marxist principles emerging from the Industrial Revolution.
- CPChamath Palihapitiya
What about price fixing?
- DFDavid Friedberg
So, so as an example, the price gouging, you know, price caps on food proposal, the concept of a wealth tax, not necessarily the unrealized capital gains tax, but separately, a tax on wealth, all of these concepts of the degradation of power structure through policy. Uh, and in part, some have argued that the antisemitism arises from these principles, in that the Jews are considered a privileged and powerful, uh, uh, cultural class. Is that n- is that not being observed? Do you not, do you not think that there's some tendencies that are emerging in the Democratic Party, and maybe influenced by a louder far left, and that far left is becoming more loud and, and better represented in the party?
- CPChamath Palihapitiya
Look, I think we should speak out against both the far left and the far right. Um, I think it's important to do both. And so, you know, since, you know, uh, I'm, I'm, I, I'm playing the Democrat here on this conversation, I'll ask you guys to play the, the, the... or especially Sax to play the Republican and, and speak out against the, the far right, too. Um, but the, the, the short answer is yes, there are, uh, amongst the extreme lefts, that's not everybody in the Democratic Party-
- DFDavid Friedberg
Yeah. Yeah.
- CPChamath Palihapitiya
... but the extreme left, there is, um, some, like, you know, misunderstandings about, you know, why it's important to do, defend, you know, kind of anti-genocide. It's like, "From the river to the sea." It's like, yeah, that's a genocidal statement. Don't use that one (laughs) , right? Like, understand what language you're using. And, and to be, like, look, the, you know, we've had a great genocidal moment with, you know, World War II, and we're still trying to recover from it. Um, two, you know, questions around, like, like, what I think is a, uh, uh, a, a foolish wealth tax, even though it's, by the way, narrowed to, like, 80%. And then on, like, the, the price gouging stuff, um, you know, one of the things as I started scratching at it, you know, it was interesting, I think this week, Kroger said, "Yes, we did actually artificially raise prices to profit from the pandemic," you know? And yeah, you should stop price gouging. It's not quite the same thing as price capping, and apparently there's laws that affect, even in Florida, right, or in Texas, uh, where some of, you know, uh, you guys are living. So, like, it's kind of, um, you know, it's like, okay, I need to understand this issue in more depth, but I don't think it's as simplistic as the political headlines are having it. Well, but the reason why Kamala Harris proposed the price fixing proposal, price gouging, whatever you wanna call it, was in response to inflation. In other words, we've had 20% erosion in purchasing power over the last four years. Harris needs a response to that, so she came forward with this new eco- economic proposal. So it's in that context this came up. Uh, this wasn't some proposal by the far left of the party, unless you consider Kamala Harris to be far left. I actually do.
- DFDavid Friedberg
No, nope.
- CPChamath Palihapitiya
But, okay, fair enough, but my point is just, this is her proposal, and it's in response to inflation. I mean, you don't... Y- y- y- you understand what causes inflation, right? It's like-
- DFDavid Friedberg
Yeah.
- CPChamath Palihapitiya
... the government printing too much money. It's not, it's not greedy corporations raising their prices too much. I mean-
- DFDavid Friedberg
Yeah.
- CPChamath Palihapitiya
... do you agree with that? Look, I agree that you have to have good monetary policy. And so I think we, we probably agree on that, and I think some printing of money is part of a normal functioning economy, but too much is, is bad. And I don't think... Look, I think price, uh... Look, part of the reason why we were just talking about antitrust stuff earlier, you do have to look at places where there's a, there's a possibility of kind of commanding stuff from your, you know, privileged position. And, like, you know, the, like, I wanna go look- Well, we, we all agree, we all agree that monopolies have to be controlled. No, no, no debate there. But that's not what's caused the inflation, right? Because we've had-
- DFDavid Friedberg
No, no.
- CPChamath Palihapitiya
... inflation of commodities, not just monopoly products, but commodities like dis- food staples, eggs, you know, chicken-
- DFDavid Friedberg
Yeah.
- CPChamath Palihapitiya
... stuff like that.
- DFDavid Friedberg
Driven, driven by-
- CPChamath Palihapitiya
But it's-
- DFDavid Friedberg
... fuel and labor and all the other inflationary, you know, underpinnings of those markets. And I think we tried to highlight that. I don't know if you saw Elizabeth Warren's interview on CNBC where she got taken apart because she made some claims about profiteering by Kraft Heinz.
- CPChamath Palihapitiya
Oh, yeah.
- DFDavid Friedberg
And the CNBC anchors pointed out, "You are actually incorrect. Kraft Heinz has seen a reduction in profit over this period of time." (laughs)
- CPChamath Palihapitiya
Yeah.
- DFDavid Friedberg
And so, like, there were factual inaccuracies in these-
- CPChamath Palihapitiya
Yeah.
- DFDavid Friedberg
... belief systems, but, you know, for me, it feels a lot like the government setting prices in free markets is one of those steps towards socialist principles that worry me the most.
- CPChamath Palihapitiya
Yeah, and look, I, generally speaking, as I was saying earlier, I'm like, like, make sure the network sets, sorts it out versus, you know, centralized control.
- DFDavid Friedberg
Totally, totally.
- CPChamath Palihapitiya
So, so it's kinda like you have to look at, is there a place where you're, like, going, "Okay, that's the reason why I, like, focus..." Her words were price gouging. And if you're focused on the kind of gouging side of it is like, oh, there might be a market inefficiency that you're essentially correcting, then that's, I think, the same kinda thing we were talking about with, like, the FTC and the Apple s- App Store and so forth. If it's like the, "I'm just gonna set a fixed price on eggs," (laughs) right? That's a bad idea. And by the way, there's, there's bad ideas, like the wealth tax thing, that I, that I disagree with. Her, her economic thing also had housing, which I think is a, you know, a good...... you know, kind of thing to kind of lower cost for Americans and, you know, kind of make that kind of, uh, stable work. Like I think she's, she's been good on immigration. Um, I think this... The, the Lankford Cinema Bill, which was from, you know, the, the, the Republican side, was something they were f- fully prepared to endorse and, you know, Trump killed it because he wanted to campaign on it. It's like, look, we care about the actual running in the country. And so, look, I, I think there's a bunch of good things. But if you said, "Do I defend price capping?" The answer is not as an independent principle by itself. And by the way, are there people lefties, like, you know, a lot of what Elizabeth Warren says about capitalism, I disagree with. (laughs) Right?
- RHReid Hoffman
I mean, I could disagree with you on the border. I think, you know, Kamala Harris used to be considered the border czar, that's gotten scrubbed. I don't think she's done a great job on that, but whatever. That... I wanna go back to issues that affect Silicon Valley. 25% unrealized gains tax, uh, it seems like most of Silicon Valley, almost all of it, is either disagrees with this or is up in arms about this. I think, J Cal, you would... You said that this is disqualifying.
- 1:04:19 – 1:19:03
How Silicon Valley views both candidates, why Reid funded legal action against Trump
- CPChamath Palihapitiya
But one thing, by the way, look, in the spirit of The All-In Podcast, I wanted to be clear about like there's, there's, there's stuff on the, on the Dems and some of their economic policy for the far left people that, you know, kind of, you know, they're advocating for that I'm opposed to. You know, Sachs, I'd love to hear from you what parts of Trump's thing you're opposed to.
- DSDavid Sacks
Here we go.
- RHReid Hoffman
Well, look, I mean, I have been consistent on this pod for years that I thought that the, let's call it the like extreme pro-life side, was not good for the Republican Party and I've been opposed to it. Um, I don't think it's what J Cal says. I think that overturning Roe v. Wade did not abolish abortion, it basically returned the issue to the states. And if you look at the referenda that have happened, they've pretty much all gone the pro-choice direction. So I think that the overturning of Roe v. Wade has actually allowed the country to sort of sort out that issue, although it's not completely sorted out. But look, I would not support a national abortion ban. I would not support re-federalizing the issue. I think there's a lot of issues, uh, about, you know, war and peace where I do not support the, you could say, the establishment neocon strand within the party. I do not support all these interventions, I do not support these forever wars, and there is a big debate in the party about that. Now, one of the reasons why, at the end of the day, I support Trump, is I know this will strike some people as counterintuitive, but I think he is the moderate within the Republican Party. He's a moderate on abortion. I know, J Cal, you're still bitter about that Supreme Court case. However, he's been very, very clear that he will not support a national abortion ban. Moreover, he took the abortion language out of the Republican platform. I think he's the moderate on, um, on issues of, of war. He's, he was the first Republican candidate to run opposing Bush's forever wars. So I give him credit on those things. On style, he may not come across as a moderate, but those are style points. I think on issues, he is the moderate. The, the issue I have with Kamala Harris is I don't think she's a moderate, you know? So like, just to take this 25% unrealized gains tax first, when this issue came up, we were assured, "Well, she doesn't really believe that," even though it was in the Democratic platform and it was in the Biden-Harris budget. Then people said, "Well, maybe it's part of her platform, but it's not a priority for her."... and we just had one of her, like, top economic advisors come out on, I think it was CNBC, defending it. And her campaign confirmed that she supports it. Okay? So now the argument has become, well, she supports it. It is really part of the platform. She would do it if she could, but she's not gonna be able to do it. I just don't think that's a ringing endorsement of a, of a candidate. I don't think you wanna support a candidate because they're not gonna be able to do what they really wanna do.
- CPChamath Palihapitiya
Do you think she's a moderate or do you think she's a socialist, you know, uh, gonna take the country very far left by the way, socialist principles, Reid.
- DFDavid Friedberg
By the way, what, what Sachs- What's- Yeah. But what Sachs didn't address is Trump's tariff policy, which is also inflationary-
- CPChamath Palihapitiya
Yeah. Exactly.
- DFDavid Friedberg
... almost equivalent to the price gouging, uh, you know, food price caps. I think that they're both inflationary and they're both bad policy. That's my personal point of view.
- CPChamath Palihapitiya
Yeah. Tariffs is where I thought it was gonna go.
- DFDavid Friedberg
But, you know. Anyway.
- CPChamath Palihapitiya
Yeah.
- RHReid Hoffman
Uh, honestly, I'm not, I'm not sure what I, what I think of that proposal. Um, you know, I guess it depends on the details.
- CPChamath Palihapitiya
What do you think, Reid? Is Kamala-
- RHReid Hoffman
I'm not, I'm not endorsing it, I'm not opposing it. But, but just, just back to this point that should we support Kamala Harris even though we oppose all the policies that her campaign says she supports? 'Cause it seems like that's the argument now is that Silicon Valley's expected to support Harris even though she wants and her campaign has confirmed she wants a 44% capital gains tax. She wants a 25% unrealized gains tax. These are things that I think the vast majority of Silicon Valley considers to be disastrous for the startup ecosystem. Should we support her in spite of those things?
- CPChamath Palihapitiya
Well- Okay. Look, The Information did a p- an actual data poll as opposed to us being talking heads saying, "We say that Silicon Valley does X or Y." And, you know, The Information's poll showed that there was, you know, much broader support for the Democratic ticket than the Republican ticket. Just use-
- RHReid Hoffman
Wait, wait. Is that, is that the thing that Ron Conway just tweeted?
- CPChamath Palihapitiya
He might have. Uh, I don't know if he just tweeted a poll.
- DFDavid Friedberg
No, no, no, no, no. That's, that's different.
- CPChamath Palihapitiya
That, that's just ... No, no, no.
- DFDavid Friedberg
That's DC for Kamala.
- RHReid Hoffman
That's different. That's different.
- CPChamath Palihapitiya
That's a subset. Yeah.
- RHReid Hoffman
Yeah.
- DFDavid Friedberg
That's a, that's a, that's a different group. That's a group to counteract you and Chamath, uh, uh, throwing a fundraiser for Trump (laughs) I think, where that came from.
- CPChamath Palihapitiya
Yeah. Exactly. Whatever, whatever.
- DFDavid Friedberg
(laughs)
- CPChamath Palihapitiya
So, so but The, The Information, a news source, that, that, that ran a poll, you know, did it objectively, ran the whole thing to try to answer the question, came out with more folks in favor of, you know, uh, the Biden-Harris ticket than, uh, the Trump ticket.
- DFDavid Friedberg
I believe that.
- CPChamath Palihapitiya
Well- Well, 'cause, 'cause look, taxes is an important issue. And I think if you ask any s- any Silicon Valley business person, they say, "Look, lower capital gains, promote long-term investment." Ask me, that's what I would say too. But, you know, you kinda go, well, what actually in fact you most need for business is stability, uh, rule of law, not grifter capitalism where it's like-
- DFDavid Friedberg
Mm.
- CPChamath Palihapitiya
... you know, give me a ability to launch my own NFT, uh, you know, et cetera, et cetera.
Episode duration: 2:11:43
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