Why Elon Outcompetes Everyone | Shaun Maguire, Sequoia

There's Elon the individual, which I would never want to underestimate. But

there's also Elon the collective, which is really like 20 people or so that have been working with him for a very long time. They've built unbelievable amounts

time. They've built unbelievable amounts of trust. They

of trust. They >> execute his will autonomously >> and just with like force and scale and precision. Basically, all the other

precision. Basically, all the other entrepreneurs I know in Silicon Valley, this is not how they operate.

>> Today, I have the pleasure of sitting down with Sean Magcguire. Uh he is a partner here at Sequoia. Um, I would like to start off with you've had the opportunity to kind of be close to Elon

and see how he operates. And I think a lot of people think to themselves like how does Elon do it? So, how does he do it?

>> I mean, look, there's people that are a lot closer to him than me. Um,

but I've been lucky to I'm close to a lot of people that are second degree.

Um, and there's a lot of things I'd say. So,

one at Sequoa when we were doing one of our big investments, some of my I think this was a big SpaceX investment, one of my partners like, "How can you possibly

do multiple companies?" And I ended up writing this kind of internal letter where I drew an analogy to this kind of

weird math collective called Burbachi.

I'm guessing, have you ever heard of Nicholas Burbachi? I have not.

Nicholas Burbachi? I have not.

>> So I may have some of the details a little off but Burbachi was a French math collective. So what happened is

math collective. So what happened is sometime I think it was like the 40s 50s something like that I can't remember exact maybe even the 30s I can't remember uh of the n of the 1900s

this new mathematician burst onto the scenes and started solving a bunch of un unsolved you know problems in mathematics and the math community was like who is burbachi who is this person

and it turns out burbachi wasn't one person burbachi was a collection of a bunch of like very very talented young French mathematicians And the first of all, people don't quite

understand that France has one of the best math communities in the world. Like

huge number of fields medalists. I think

something like 25% of the fields medalists in the last 25 years were trained in in France.

>> Um so that's an insane stat and I think would surprise a lot of people. Um, and

so anyways, they have this really incredible math education and their mathematicians have a little more flare, a little more pizzazz than what we think of as, you know, mathematicians here. And they did this

mathematicians here. And they did this just kind of to mess with everyone and to have fun.

>> Mathematicians with RZ.

>> Yeah. Quite literally mathematicians with RZ. And if you want like go look at

with RZ. And if you want like go look at there's a mathematician named Cedric Villaini.

Um he won the Fields Medal in like 2012, something like that. He he always wears tuxedos with these like crazy bedazzled spiders on them and these crazy bow ties

and uh like the French mathematicians have a lot of RZ, which is not what you'd expect. And so anyways, there's

you'd expect. And so anyways, there's this um there's this French math collector just kept solving these unsolved problems. I'm like, who is Burbaki? And for me, and then it came

Burbaki? And for me, and then it came out later that it was like 10 or 20 mathematicians that were all doing work together and putting only one name on

the work. And the way I think about like

the work. And the way I think about like Elon, Elon is obviously an individual and like one of the most talented humans

of all time, a visionary who works harder than I can even imagine. and you

know works 16 hour days, 7 days a week.

>> He just works when he's awake.

>> I mean, and I think maybe even sometimes when he's sleeping or he just or he doesn't sleep much, but I've tried to keep up with him a couple days and like I'm a pretty fit guy. I literally can't

keep up with him physically. Um, and so anyways, Elon as an individual is one of the most talented people in the world.

But I view Elon as almost like there's a second thing. There's Elon the

second thing. There's Elon the Collective, which is probably about 20 people. I'm not going to name any of

people. I'm not going to name any of them. And there's, you know, roughly 20

them. And there's, you know, roughly 20 people that, you know, have been working with him for a very long time. They've

built unbelievable amounts of trust.

They know how to they can almost read his mind and they know what he would want to have done in some situation and then they also know when they need to

escalate a question to him. Um, and this like you can't build this quickly.

>> Mhm.

>> It takes it kind of takes like a decade to really trust someone and to test the limits of what they can do. Um, and test that they can do things at the highest possible level and almost like be a

proxy for you. Um, and I've actually never seen another entrepreneur that has done this the way that Elon has.

>> I'm kind of thinking of uh Mr. Beast is the only person that I've ever heard of.

He basically tried to clone himself and then he tried to have his like top lieutenants also clone themselves out of four three or four people each.

>> I I know a little I live in LA so I know a little bit about Mr. Beast the way he operates. I think that's a good analogy.

operates. I think that's a good analogy.

Um but for basically all the other entrepreneurs I know in Silicon Valley this is not how they operate and it's it's really a superpower for Elon. It's

not easy to replicate and I'd say there's a lot of things that go into it.

like one first of all Elon is just one of the best judges of talent on the planet and like I'm not going to name the person

but there's a very senior person that works for him who uh studied economics in college and they went in for like a

final interview with Elon and he re he said you're not going to do bisdev you're going to do mechanical engineering because the person was he could just tell they're very good engineer

and they literally studied economics.

Um, and the person rose up to be a very senior engineer. And this is the type of

senior engineer. And this is the type of thing that I just like you can't fake that. That is such a superpower to be

that. That is such a superpower to be able to meet some young kid straight out of college study economics and be like actually you have an engineering mind.

You're you're not doing bisdev. You're

going to be a mechie. Um, and so anyways, like he's an incredible read of talent and he gives people he gives people the rope to hang themselves. And

what this means is that if you actually perform, you will rise up really really quickly. But if you screw up once, like

quickly. But if you screw up once, like you're basically >> you're out.

>> You're out. And you know, when you do this over, you know, 10 years and you just keep letting people rise up way more quickly than they could in almost any other organization, you build

incredible loyalty with the most capable, competent people. You basically

give them more than they could get anywhere. Um, and especially if you

anywhere. Um, and especially if you compensate them generously for that. And

then you also, you know, you also turn out a lot of people because turns out most people are not very competent. most

people are not very loyal and you know it's you kind of but I I'm a believer that it's like the it's the top 1% in the organization that are the most

important and are the ones that really really drive things and those are the people that you want to stick around for a long time and really learn like how

where all the knobs and levers are in an organization and so anyways I just this is how I would try to explain Like there's Elon the individual, which I

would never want to underestimate or be, you know, enemy with because he's a very competent enemy. U but there's also Elon

competent enemy. U but there's also Elon the collective, which is really like 20 people or so that like he can just like the

>> execute his will autonomously.

>> Well said. Um and so execute his will autonomously and just with like force and scale and precision. And it's

something that you just people don't have intuition for what 20 people that are aligned can do.

>> I imagine that like execution ability and speed is like critically important.

And I also think your bar has probably shifted over the past like 15 years for what great looks like there. Um how has that been?

>> So it's a really good question.

Yes, my bar has shifted a lot. I would

say the one thing that my bar hasn't shifted on. I think one of my one of my

shifted on. I think one of my one of my superpowers is I've been just some partially comes from luck. I've

been lucky in my life because I have spent time in a lot of communities. I

have seen like truly the best people in the world in many different fields. And I'll give you examples like in 2010. So I spent time doing a math PhD. I ended up

finishing my PhD in physics, but for a while I was doing math and I had a PhD adviser for a while who was incredibly talented mathematician named Nikolai

Macarov and one of his students had won a Fields medal actually won the Fields medal that summer 2010. Uh this is

Stannisov Smeirnoff. And so basically I

Stannisov Smeirnoff. And so basically I had a PhD adviser at the time and I ended up doing this really advanced math summer program called the clay math math

institute summer school which that summer it was in probability and statistical physics in two dimensions and the summer school was in Brazil. It

was in Buzzios Brazil which a beautiful part of Brazil. So we went for a month and it was about I can't remember exactly how many about about 100 people.

was probably 30 professors, 30 postocs, 30 grad students, something like that.

And it was unbelievably high level. So

out of the 100 people there, there were a couple fields medalists like Wendelyn Warner. And then there was, you know,

Warner. And then there was, you know, one person who got a fields medal that summer, Stennis Smeirnoff. Um, and there was one PhD student who was a PhD PhD

student in France. His name was Hugo Duminal Chopen. And so he ended up

Duminal Chopen. And so he ended up getting the Fields Medal like 8 years later. And so I spent a month, we were

later. And so I spent a month, we were all like living in one hotel and we were together all day every day. And the grad students would spend it was about 30

grad students. I'm like that's my

grad students. I'm like that's my memory. We spent a lot of time together

memory. We spent a lot of time together and we're all competing like the American kids were competing against the French kids. the the French, it's really

French kids. the the French, it's really hard to explain how tight-knit their math community is because they pretty much all go to two universities like ENS and Polytenique for their undergrad

equivalent.

Is it is it like a competitive dynamic between those two different universities or is it kind of like a shared >> they have a competitive dynamic but then when there was all the like you know and

there were probably eight to 10 of the grad students and then there was probably like six or seven from America and a few like from Oxford and Cambridge and a few from other places a couple

from Israel. Um the French like we're

from Israel. Um the French like we're very competitive and we would play like we would play sports, play volleyball a lot of times and like the French kids

were it's just not what Americans would think of as math people. They were like psychotically competitive uh and they would always want to play against you know everyone else.

>> Would it be a more like the the Greeks where you were both fit and also highly intellectual?

>> They were fit and highly intellectual.

the other I would also say the Russian you know mathematicians were fit and intellectual the American ones were not as the intellectual >> just the intellectual um but so like I

was in this program and I mean I got to interact pretty closely with two people that went on to win Fields medals won

that summer and we all knew like it was it was basically everyone there assumed that Stannis Los was going to get the Fields medal that summer and for Hugo

kind of the broad consensus was that he was the best of the PhD students at the time. Um, and so for me to get to like

time. Um, and so for me to get to like see this level of mathematician where you actually get to see the true tale

outliers and you kind of even get to anticipate ahead of time like who's going to win the fields medal all this like it gave me this grounding and I'm going to bring this all together in a second but it gave me this grounding and

like what is just true tail outlier mathematic like mathematician ability. I

also like in the summer before that I worked in an algorithmic trading group at DRW and like DRW was probably the top algo group at the time

definitely a top three or four and the intern class in the algor group there were five of us and all five were like people were really smart so one of the five was this guy Eufiao

>> Eufay >> um was kind he was a legend at MIT he was a three-time Putnham fellow I believe and I believe a three-time IMO

gold medalist and then he became a like a tenure math professor at MIT doing cominatorics and but he kind of like so this is college math competition called the

putnham EU kind of broke the putnum because he's such a good teacher and he knows competition so well that before EU

it would whoever won the put any year would be kind of equally likely to be Harvard or or MIT or or you know then a little bit less likely but sometimes

Princeton, sometimes Stanford uh couple times like in the 20 years prior Caltech and and EU just broke it. MIT just won

every single time after EU. And so I did this internship with EU and there were five interns and so I was at the EU all day every day and we would just we would all do brain teasers with each other.

We'd probably write code for 2 hours a day or three hours a day and the rest we would just do brain teasers with each other. And this for me having this

other. And this for me having this calibration where I've gotten to spend like meaningful intellectual time with the absolute tail outlier people. It's

given me this calibration on true tail allers. I'm going to give you I've come

allers. I'm going to give you I've come up with a framework and I'll mention in a second. But I also I actually started

a second. But I also I actually started my PhD in AI um in the stats department at Stanford. But this is before deep

at Stanford. But this is before deep learning. This is when it was

learning. This is when it was statistical learning. And so I got to

statistical learning. And so I got to see a lot of the early like really good AI people.

I then did it in physics and I knew a couple Nobel Prize winners before they become Nobel Prize winners in physics like Kip Thorne. Um, and so I've just

I've been able to be exposed to the absolute most extreme tale people in a bunch of different fields. And as an investor, this is incredibly powerful

because it's the real outlier people that drive, you know, like >> it's the .001%

sort of situation. I also know that when you meet one of those people, it just smacks you over the head like how good they are and then your bar for quality just drastically shifts.

>> Yeah. So, I'm going to I'm going to build on that. I would say I picked up I've learned a lot of things. one, I now

think of people in intellectual fields.

Um, I I I'll make a few comments. One, in

mathematics, I think that there's something like 15 distinct levels beyond just being incredibly good at mathematics. I'll walk you through a

mathematics. I'll walk you through a bunch of these. And

I think these levels are are distinct.

And there's this oneway feature where people can look down like they can look to the you know >> it's a very clear like uh every every you know different tier is obvious from

above but it's not exactly obvious.

>> It's not obvious at all from below. And

like once someone is three tiers better than you, you can basically just tell that they're better than you. that if

placing of someone three tiers versus six tiers is very hard for someone um let alone telling the distinction between like six tiers and nine tiers just incredibly hard for people. I'll

give you example on the math side and then I'll I'll make an analogy to the chess rating scale. So

in mathematics like the you have basically the once in a century mathematician. This is someone that

mathematician. This is someone that is better at math in basically every sub field than everyone else. And you know,

even for fields metal level people, they can kind of go see someone else's research problem and within a few weeks like they're ahead of them in the area.

And you know, this only happens about once a century. Then you have the like once a decade person. And a once a decade person will it's like guaranteed

they win a Fields medal because over the course of their life they'll probably do like five to 10 things that are worthy

of a Fields medal rather than just one um or two. And someone like this I mean like maybe it's someone like Terry Tao and it's hard to say exactly but you

know these are the types of names you'd have. Is this something where you can

have. Is this something where you can only kind of look figure it out looking backwards on whether or not they were I think you can often time like if you are on a very high level you can actually

tell looking forwards. Um, but anyways, you have like the once in a decade mathematician.

Then you have like the typical Fields medalist who's incredibly good and, you know, does call it two or three things in their life that might be worthy of it because there's some luck and there's a

bunch of people, you know, not a bunch, but there's there's some luck at that level. And then you have the person that

level. And then you have the person that like just gets tenure at a top five math research university at a very young like at a young age. So someone that gets

tenure at MIT or Harvard without getting a fuse medal. And so maybe someone like Euhiao who I mentioned before is like on that level. Um so it's like they very

that level. Um so it's like they very easily get tenure at a top university at a young age. And then you have someone that like easily gets tenure at a young age at a top 20 university. And then you

have someone that like just gets tenure at a top five university in mathematics.

Uh and then you have someone that like just gets tenure at a top 20 university in mathematics. And then you have

in mathematics. And then you have someone that like from here there's a little bit of a branching like maybe someone decides to

like be a math professor at a top 50 university or maybe they decide to join a hedge fund. But and when I say join a headphone, it's like they still got a

math PhD at a very like at a young age from an from a top five university. So

it's like the median Harvard or MIT or Princeton math PhD. And then you have someone that like easily gets a math PhD from a top 20 university. Then you have

someone that like easily gets a PhD from a top in in math from top 50 university.

And then and just bear with me. Then you

have someone that like trivially gets a math major in, you know, pure math from a top five undergrad. Then like trivally gets a math major from a top 20 undergrad. Every one of these is a

undergrad. Every one of these is a distinct level. And looking down like

distinct level. And looking down like it's pretty easy to place like almost exactly where someone is within one or two tiers, within 30 minutes of talking

to another mathematician. Um, and then you have, you know, all the way down to like like for every one of these people, they get an 800 on the math SAT without even

trying. Like that's like you don't even

trying. Like that's like you don't even these people are just born 800 math SAT is is a joke. Uh, and it and when you take with all the with all these levels,

and I could go through 15 levels or so, when you're in high school to like the typical high school teacher that teaches math, they can't tell the difference between any of these levels. Uh, and so

like anyone that gets an 800 on the math SAT, like they're all lumped into the same category. you lose all the texture

same category. you lose all the texture and gradation, but having the ability to tease out with like pretty high fidelity like

ahead of time before the accolades have caught up. So to be able to predict

caught up. So to be able to predict where people are going to go in the spectrum like that is an absolute superpower. Uh and you know you kind of

superpower. Uh and you know you kind of you only develop it by being around by seeing the absolute most extreme tales

and having some talent yourself. um like

I think you can only look a few levels ahead of yourself with with precision.

So kind of the way I think about this in terms of the chess rating scale.

>> So like in the VA chess rating scale it's something like a you know the best players in the world are around 2850 2870 something like that

you know Magnus Carlson and these guys 2500 is where you can start to be a grandmaster.

If you have a 2850 rated player play a SE 2700 rated player, they're going to cr absolute crush them 99% of the time or more.

>> This is where you get the video of Magnus Carlson drunk beating someone else at 2500 2600.

>> He can play like 10 of them, you know, at simultaneously with a blindfold while drunk. Um, you know, if you take a 2700

drunk. Um, you know, if you take a 2700 rated player and you have them play a 2500 rated player, like they'll absolutely dominate them. The lower you go, the more variance you get. So like

2500 rated against 2300 it's probably not 99% it's you know 90% 85%. And I I don't play chess >> fuzzier and fuzzier fuzzier and fuzzier

forworth I don't play chess but I'm very proudest I have a great-grandfather that beat Alex Alakine who was the world champion when my great-grandfather beat him. The game is on chessgame.com or

him. The game is on chessgame.com or whatever chessgames.com. He also beat

whatever chessgames.com. He also beat the US champion. I was forbidden from playing chess as a kid because my grandfather felt like he lost his his

father to chess. Um, so I don't play chess. I don't know. I'm just using this

chess. I don't know. I'm just using this because I think it's universal language.

Um, but I'm not an expert in chess.

But anyways, you know, if you if you do the thought experiment of if you have a thousand rated player randomly see like

the games of say 1 1400 rated players, 1,800 rated players, 2200 rated players, 2,600 rated players, and they have to place, you know, which game is which.

It's random. Like, they have basically no ability to know which game is which.

If you do it the other way, if you have a 2,800 rated player see, you know, these games, they can tell you in 10 moves or whatever or with great accuracy >> with unbelievable accuracy.

>> And so this like this for me is a very as an investor where one like my core job is assessing people and talent and especially at the earliest stages and

understanding like the level of talent.

Um this is just like this is a mental model I developed that I really my first question when I meet a founder is to try to understand what skills matter for

this company.

>> So there's a lot of companies where intelligence don't matter at all. You

know if you're if it's a you know if it's if it's like a simple product to build >> trash collecting company >> I mean if it's trash robots then it

matters. If it's if it's a mafia driven,

matters. If it's if it's a mafia driven, you know, like mafia mandated trash company then no intelligence doesn't matter. Uh so it's first question is

matter. Uh so it's first question is figure out what properties actually matter and then from there try to figure out like where is this person on the scale for the most important traits

whether it's sales ability whether it's like their raw mathematics ability for AI research companies whether it's their you know like you just have to figure out and I could go through a lot of

examples of companies whether it's like their pure pain tolerance which is the case for some companies um but anyways this is I'm sorry for the very very long

monologue, but I I think this is underappreciated in the world, especially in the tech community, just like how how how

many how distinct these levels are in the tail. My little brother is like a

the tail. My little brother is like a top one or two in multiple Starcraft 2esque games in the world. And he's uh it's it's funny to watch him analyze other people because he can pin like

someone within a you know 30 points or 50 points on a you know 3,000 rating scale >> uh every single game that he sees without looking which is kind of fun.

>> Um >> and and looking quickly you know you can probably first Yeah.

>> Some some it might be even like the first you know minute and a half.

>> Yeah. you can probably tell within like 100 or 200 within the first 30 seconds and then give him 5 minutes and he'll have it down to within like 30. But

there's there's also there's also something where like if you just see a position on a board like a god view of a position he could probably pinpoint relative >> performance even just a static snapshot like he can

>> know know this guy you know high rated player would put >> and knowing how long into the game for Starcraft because >> you know you need kind of need to know how what they've developed within one

minute 2 minute or whatever >> when you're trying to use that sort of mental model on a business where you aren't let's say a 2,800 or 2850 on all these different industries. How do you

kind of gauge that with a founder?

>> Yeah, look, it's a there's a lot of industries where it doesn't matter. But

even just for assessing say the quality of engineering teams that's very it's almost every tech company the quality of engineering team matters. And so like a

big part of why Google was so successful is just purely that the founders were geniuses and their engineering team was one of the best of all time early on and

you know and the same is true for Facebook and the same is true for like Stripe in the early days and like a lot of a lot of companies and this is

something where it's just I think it's a critical input to a lot of companies. So even if it's not

of companies. So even if it's not necessary for the founders um like the raw technical ability will come up more often than you would think. Um

>> so you basically use like the engineering team as a proxy to gauge whether or not the founder is good.

Um it depend like it it depends that is so I'll give you like this isn't the only thing but so I was the first investor in a company

called factory it's an AI cogen company it's still a very early stage company it's starting to do really well now though the founder and I got really good

terms in the first investment $1 million for 20% uh because the founder cold emailed He was he was doing his PhD and

at Berkeley and this was before the current AI mania and the founder had written a paper as an undergrad with a guy named Juan Maldisena and Juan is

like one of the most famous most highly regarded string theorists in the world and like for me like that anecdote alone was like okay this guy is incredibly

talented and so kind of knowing what signals to pick up on of like Okay, writing a paper with Juan, as I put it in the email because he knew that I would pick up on the code of who Juan

was, um, as an undergrad, like that alone kind of means he has a minimum, he's like a minimum 2600 rated technical ability. Um, and then you have to go

ability. Um, and then you have to go through all the other traits. But like

being able to pick up just from a cold email that because they published a paper with Juan as an undergrad and it'd be different if it was a a paper with Juan as a grad student, then then the

lower bar is like 2300 or something, but to do as an undergrad means it's 2,600.

And so it's like definitely worth taking the meeting and worth investing in. And

I think very few VCs would have known just from a cold email where he said, you know, I published a paper with Juan.

They wouldn't be able to pick up on that signal. And so it's very useful.

signal. And so it's very useful.

>> My hunch would also be that the fact that he did research on you and knew that you would kind of get this is also part of that.

>> Yeah. And that meta that he like had the the riz to just say like published a paper with Juan, not Juan Maltto. I

loved that. I thought that was like, you know, the good meta game and that matters too. And this founder has really

matters too. And this founder has really good sales ability and so that like that's that's the magic is he had very strong technical ability and incredible

charisma, empathy. Um, so anyways, fun

charisma, empathy. Um, so anyways, fun to work with. His name is Matan Grinberg.

>> I want to do a hypothetical. Yeah. where

imagine you're stripped of all credentials achievements cash network, all that stuff, and you're given 10 billion dollars, >> and then you're tasked with creating the modern Bell Labs. What do you do?

>> How do you build it?

>> I call up my friend Casey Hanmer, >> who I've known since grad school. Um,

>> honestly, I I like I know who to call. I

call five friends, and Casey's one of them.

And I tell Casey like, you know, pause Terraform Industries and we're building the next Bell Labs from

there. I mean, look, part of the secret

there. I mean, look, part of the secret of Bell Labs was that it was attached to a monopoly that was cash flowing incredible amounts of

money. Um,

money. Um, and so I think the next thing is find when you get to start with $10 billion,

what is like how do you turn 10 billion into a very very high probability like cash machine? Because I think 10 billion

cash machine? Because I think 10 billion is probably not enough to like sustain a Bell Labs. So how do you turn bel 10

Bell Labs. So how do you turn bel 10 billion into something that is like with very high probability within 10 years become something that generates a few billion minimum?

>> I know Charlie when we were talking about basically like if you wanted to reverse engineer like a multiundred billion or trillion dollar company the best one of the best ways that you could do it would be um through a beverage

basically like recreating Coca-Cola because there's like no taste no taste memory and all these different things.

>> How which business would you start off the back of that? If if I had 10 billion, one would be the chemicals industry.

>> I think the chemicals industry is one of the most underrated industries in the world for many reasons. First of all, chemicals is bigger than oil and gas.

Like most years, the sales of chemicals is bigger than oil and gas. Call it 5 trillion a year of sales. Oil and gas is like 4 trillion or so. So, it's a big industry.

>> Big industry that no one's touching.

>> Big industry. Um, and most people think of chemicals as first of all, most people don't think about it. If they do think about it, they don't know what it

is. They think it's commodity industry.

is. They think it's commodity industry.

A lot of chemicals, probably half is like raw commodity. So making making like plastics or things that are almost just direct byproducts of the oil and

gas industry. But a large fraction of

gas industry. But a large fraction of the industry, I'd say at least 25% is like hardcore specialty chemicals that are actually very rare. A lot of times there's only one company in the world

that will make some specialty chemical.

And if they like I work with one Elong company that there was a chemical that like they lost access to probably three years ago and they were going to have to

shut down operations. Seriously. And uh

>> how much of a like economic impact did that one chemical have on the like company?

>> I mean it would have it would haveions them by months >> going into making the investment in SpaceX. It was not the same situation as

SpaceX. It was not the same situation as is today where Tesla is worth you know $1.5 trillion um and Elon has multiple multiundred billion dollar companies just sitting on the sidelines. Um and

you know going in in 2019 I think Tesla I remember looking it was worth like 4050 billion and so going into the SpaceX investment at 36 and then later

like 47 or something it was a very different environment.

>> Yeah. People thought I was insane. It

was it it will sound crazy today because today it's such an obvious consensus investment. At the time it was insanely

investment. At the time it was insanely non-obvious and non-conensus and like the original investment conversation was the most controversial contentious

conversation I've ever been a part of.

Like we we vote on a scale of 1 to 10 and one like general partner voted a one out of 10. It's the only one I've ever seen at Sequoa. But I didn't take no for

an answer and you know made people fly down to LA and we you know we end up deciding to do a $20 million towh hold then. and then people got it once they

then. and then people got it once they could actually use the product. Um, but

it was a good lesson for me and for it's worth the person who voted one is an incredible investor himself. It's just

that no one ever has full information the context on one on on everything and >> you know I was new at Sequoa so people didn't yet trust me and it's just a good

lesson to me in a lot of things like one to pay attention to the new teammates that who knows where the best ideals will come from and two to try to have

humility some humility that in areas that I'm not an expert in like like I don't know anything. I do love this line from Charlie Munger where he says, "You're smart and I'm right and sooner

or later you'll figure out I'm right."

Um, so when when you run into a situation where people don't share the same view as you do, how do you kind of like shift their perspective?

>> I think it's it's like really hard to change people's perspective in the moment, but I think you can change people's perspective over time. So like

in the case of SpaceX, it was that initial investment was one month or so of relentlessly pursuing and and this like I don't mean this can easily be misinterpreted

because $20 million is a lot of money, but in the scale of when you're asking for a $600 million investment, 20 million is a small amount. So, it's like a small, you know, consolation prize

from one month of persistence, including like being willing to pay for a plane to fly, you know, everyone to LA um from the Bay Area. But then over the next 6

months, I sent an update probably every 3 weeks or so to all the decision makers explaining to them what's happening with SpaceX and in the industry and with Starlink. And after six months of people

Starlink. And after six months of people getting an update like every three weeks or so, one, they can see how obsessed you are with the idea and like your own

conviction. This isn't they're realizing

conviction. This isn't they're realizing that this isn't just some flash in the pan. He's coming like with some

pan. He's coming like with some whimsical idea like he's actually obsessed with this and believes in it.

two for people to get the longitudinal data of see okay I'm seeing you know step by step and I'm seeing the like the first derivative and second derivative

and third derivative of progress um like you can often times change people's minds that way and this is true in everything it's true in information warfare this is true

across the board like it's very hard to change people's minds with one data point but you can you know over time >> over time kind of recy up little bit correct.

>> If you had to work with you had to leave Sequoa and go work at a startup, can't be an Elon startup, which startup would that be?

>> I mean, the obvious answer would be I would go to an Elon startup. Uh, if it can't be an Elon startup, you know, a lot of this is personal

preference. I would probably go to

preference. I would probably go to Nuros, you know, FPV drone company I invested in. I think you know the guys.

invested in. I think you know the guys.

>> And so these guys make firstperson view drones. These are like drones that

drones. These are like drones that pilots put VR goggles on to pilot. So

you're like in the drone. These are the most performant kind of shortest range drones. They've completely changed the

drones. They've completely changed the war in Ukraine. You know, something like 60 70% of the casualties in Ukraine have been from FP FPV drones. It's just

unbelievably important. And um I think we're still at the very beginning of FPV drones, but it's like the fastest changing part of the war right now. And

these guys are just so good. And the

product market fit is so strong. Like

the company is absolutely ripping. And

for myself, I am I'm very passionate about defense war. Like I deployed to Afghanistan, in the US military. I'm,

you know, still pretty involved in military affairs in things that people don't. I don't really talk about the

don't. I don't really talk about the details too much, but I'm still very involved in something I care a lot about and want America to be incredibly strong. So, probably go work for 22 year

strong. So, probably go work for 22 year olds at Nuros and they'd kick my ass, but be fun.

>> When you initially made that decision on Nuros, what kind of got you over the line? What were what were the key data

line? What were what were the key data points on those guys? And I know Saurin, you know, he was like a world champion drug racer. Um, so that's obviously

drug racer. Um, so that's obviously helping, but what other actions did they take that led you to make that call?

>> So I met Saurin. I was introduced by a guy named Ian Roundtree who's a >> seed investor. He was the first investor like led the preede in Nuros.

>> And he introduced me and like I should have invested the second I met Saurin.

something I've learned about myself and the way I invest. I gener I I generally don't make very good decisions in my first meeting and so almost everything I

invest in I like to track the company for like at least a couple months to see the rate of progress like make sure I can't get like the idea is just stuck in my head um see how the founders actually

execute and so with hindsight I wish I would have done the preede with Ian but I ended up investing about two or three months later and so number one thing was

they um like yeah sa Forin was literally the world champion FPV drone racer in MultiGP. There's two professional drone

MultiGP. There's two professional drone racing leagues. Like he was world

racing leagues. Like he was world champion in multiGP. He was also a professional in drone racing league. The

other DRL and on TV and all of this.

Next is um you know Olaf is also just off the charts exceptional. Next is

charts exceptional. Next is very early into the company. Saurin just

got on a plane and went to Ukraine to just go one learn what was happening on the front lines and two try to like coach people and how to be better FPV

pilots.

And that like that attitude of being willing to just go like fly all the way to um you know Ukraine, go to wars. He

was probably 19 or 20 at the time. Like

just love that attitude. Um, the next thing was Saurin when he was in high school, he started a small drone parts marketplace.

I think it's called like FPV Supply or something like that. And um,

anyway, it's called FPV Supply. Um,

it helped people find parts for hobbyists to build FPV drones. And that

just showed like entrepreneurial instinct. also you grew up in Alaska

instinct. also you grew up in Alaska like you and then they moved to Veron Vermont but that kind of I think it's very important

to have some not just be a technologist not just you know be an expert in a domain to show that entrepreneurial energy and so I don't know all those things did it for me

>> I'm like pretty confident that he also made titanium phone cases >> I think that's right >> yeah I think I remember that from our first interview >> and for one more bank. I think my

philosophy with I I I think they had exactly the right philosophy with FPV which is one it's all going to be about supply chain just scaled manufacturing and doing that in America and these guys

are real experts in supply chain which was kind of evidenced by starting a parts marketplace as teenagers. Um, next

thing I think beyond just supply chain and scale, the next most important thing is being really really good at radios and comms, like being just unbelievably

strong EES to where you'll be able to handle jamming and just always like stay at the absolute cutting edge of electronic warfare. And Olaf is like in

electronic warfare. And Olaf is like in he's an electronic genius.

>> He's an electronics genius. And I just because of my military experience, I knew how important comms are. And just I was following the EW side of Ukraine very closely in part as a SpaceX

investor where Starlink was operational very early into the war and like you know changed the trajectory of the war

and you know Starlink is the first like really softwaredefined you know back hall um in history and and

so like h being able to take it Starling doing what Starling was doing in very very long ranges and low power to be able to do that in short, you know, distances with higher power and like

huge jamming, which makes it obviously a much harder problem. Um, like I just knew how important that would be.

>> I don't know if I've ever heard someone ask about basically what Elon looks for in capital partners. He he really likes you guys. He really likes Antonio

you guys. He really likes Antonio Gracias and Valor. He really likes Vy.

What makes like what specific things does he look for when he's considering having a capital partner?

>> I think number one being willing to like do work. You know there's the famous

do work. You know there's the famous stories of Antonio sleeping in the Tesla factories production. Yeah.

factories production. Yeah.

>> And I mean >> weren't they doing that as well on the Roadster ramp?

>> Yeah, I think so. And I mean it's just like hard to explain how much respect I have for Antonio and like you know you're in your stripes when you're willing to do something like that. So

being willing to work and number two um like so many people leak things and it's hard to it's it's it's like this

may sound so simple but when you're trying to really bend the arc on the future like sometimes you need element of surprise and like people like most

investors are leaky and I like this is a very low are, but just not leaking things I think is >> shut the up when you have information.

>> Yeah. Shut shut the up and um and I think third thing is kind of like being there in all weather like good times and

bad and you know someone like Antonio I think has done this better than almost any investor in history.

>> I think underestimating any of Elon's companies is really stupid.

>> Yes.

>> Um I think >> and many people still do. It's crazy. I

know. I know. I think he gets a, you know, trillion dollar pay package, you know, if if he gets to eight and a half trillion market cap or something and someone still wants to short the stock, it's probably not a good idea. Um, I

think there's different phases for companies like in year seven or eight of SpaceX, it's kind of almost going bankrupt. Same with Tesla. It takes a

bankrupt. Same with Tesla. It takes a very long time to bake >> these technical companies. Um, when you look at something like Boring Company,

Steve Davis, why do you think people underestimate Boring Code right now?

Like what what do they not get?

>> I think people are really bad at thinking about nonlinear things. Like

most humans just think in terms of linear things and all like a lot of Elon's companies are very nonlinear. Um, and yes, I I think

very nonlinear. Um, and yes, I I think people just don't understand at all where the Boring Company is. People

think boring machines is easy because they've been around a long time and because, you know, like you >> there's a bunch of subway tunnels dug.

>> They're subway tunnels and they're dug by municipalities and all this. Um,

I asked Steve, you know, like to stack rank how hard Steve was a very early SpaceX employee and is a genius engineer and played a huge role in kind of

building some of the early SpaceX rockets and vehicles because he was in charge of Dragon. Um, I asked them to stack rank Falcon 1, Falcon 9, Falcon 9

reusable, Starship, like put in that spectrum of technical difficulty where like kind of the current vision of the boring machine is

and and so like what what they're working towards and are close to they call it zero people in tunnel zit continuous mining. So like that's the

continuous mining. So like that's the goal. So having a boring machine that

goal. So having a boring machine that can operate with no people in the tunnel continuous mining and he said it's a little harder than Falcon 9, easier than

Falcon 9 reusable. Um and so just think about that. It's like this device is

about that. It's like this device is harder engineering than the Falcon 9. Um

and but like people don't understand that because they can't they just look at one boring machine and they compare it to all the others. they don't

understand the difference. They people

all don't understand the difference between like a Falcon 1 and a Falcon 9 or a Starship. Um,

and so anyways, like I think people just really don't understand what's going to happen and how fast it's going to happen once Boring Company hits the milestone

of like having reliable like Zpit continuous mining. And at that point, so

continuous mining. And at that point, so like right now it's it's almost like how SpaceX until 2009 or so was did the Falcon 1 then was building the original

Falcon 9. It's like those

Falcon 9. It's like those eight years or so were like there wasn't that much progress. The only progress you had three failed Fal Falcon 1

flights and two successful ones and maybe some you know failed Falcon 9 tests. But I think

tests. But I think once Falcon 9 I started flying missions reliably then the perception of the company went to one level above like a

big jump a 10x jump in perception. I

think the same thing will happen once boring company hits like Zpit continuous mining and is like actually just operating regularly and has a bunch of these and you can't you can't go make a

hundred boring machines before the design is locked. And so it's like you you can't go make a 100 Falcon 9 before the the first one works a lot. And so

that's kind of once we hit this milestone then they'll be able to make a lot of them. But people are fools for sleeping on these companies.

>> There's this line from Elon that I've heard which is pe people respond to precedence and superlatives. How do you think about that?

>> I've never heard that.

I mean look I think that's a good line.

I think if I was to map that on to what I'm just saying like I said people aren't very good at nonlinear thinking and so the precedent is the is

once you've made it you've actually demonstrated that you're you've made it through this nonlinear regime and like you've actually hit the next nonlinear threshold so you've jumped to that next

plateau um and I think that if I was to map the superlative it's that you know like I I said, "People don't really know the difference between

Falcon 1, Falcon 9, Starship." Like, if you just go ask someone like, you know, what's the difference between these rockets?

Unless someone cares a little bit about rockets or thinks about engineering, they're not going to know the difference at all. But people can kind of

at all. But people can kind of intuitively they understand they can see a rocket landing and they can see the difference between oh like I can't tell

the difference if the payload mass or the orbit you can get to >> it blows up or it lands.

>> If it blows up that's superlative or if like the rocket lands like this a new paradigm it's super superlative that I can understand. And so I don't know,

can understand. And so I don't know, that's maybe how I, you know, doing an Optimus demo where you have the robot. I

was at the Tesla event, call it a year ago or whatever. Uh, you know, in Hollywood at one of those.

>> Yeah. The whole city that they built.

>> The whole city that they built and they had a bunch of optimists walk out. And

>> talking about that, that's the only other person that I know of that's built a city is Mr. Beast.

>> Yeah.

>> For Beast Games, but gone.

>> Yeah. one, SpaceX fully built a city and that Starship is Starbase is now officially incorporated as a city. Um,

but like that showmanship of of like actually walking out 20 Optimuses or whatever it was like

the way I mean my mind was pretty blown and I I think it's lost on video but when they came out cuz they were walking from probably like 30 40 feet away from

me down a road and I really couldn't tell like are these human actors or are they you know or are they robots?

And you know, I was like, look, you're initially you look at the face as you would with a human. And so then I started like looking down the body and then when you get to the waist, it was

very narrow, you know, nonhumanlike.

>> And so until I got to the waist, it looked like it could still be a human.

And that's like, oh man. And I knew that they because it's like the Tesla event and you know, I knew it was going to be Optimus', but I wanted to verify it with my brain. And when you see the torso is

my brain. And when you see the torso is not human like it's a very kind of profound like oh wow this is actually a robot hell yeah we're getting closer to the future a little bit we're living in

the future so that's that superlative experience that I think has nonlinear benefit in the psychology where people start to understand okay this is close this is real in a way that they can't understand just looking at a chart and

this is something I think part of why Elon is so good at attracting capital is because he's so good at kind of these milestone, superlative events and

moments that capture the imagination and just like show you what's coming.

>> You said you have to be willing to step into the fire to learn. What has been a moment where you stepped into the fire to learn something?

>> I mean, many, many, many examples for me. One, um, you know, I was doing my

me. One, um, you know, I was doing my PhD and I got recruited to work at DARPA, >> uh, which was not what I was planning on doing. Like, I was planning on finishing

doing. Like, I was planning on finishing my PhD. Honestly, at the time, I thought

my PhD. Honestly, at the time, I thought I'd probably be a professor.

And then this totally orthogonal opportunity came up to go work at DARPAN specifically to deploy to Afghanistan.

And I was like, okay, I'm in. I want to serve my country. And

like that is maximum going into the fire. And that I went into a war zone

fire. And that I went into a war zone and like actually saw like you know I >> some stuff.

>> Yeah, I saw stuff. And um like it is really hard to explain how quickly you learn when there's that type of feedback and that type of danger and you just

like to give you an example and this is not not of like the danger but there was one event where like basically

every Friday I would go from one base to another to brief a general and normally the drive is like crazy traffic in cobble.

And for I traveled all over Afghanistan, but I would normally be in Kbble for this briefing every Friday. And so

normally it's like a 45 minute to an hour drive.

Only a couple miles was horrible traffic. And one Friday we got there in

traffic. And one Friday we got there in 15 minutes or so. Like there was no traffic. And we were driving from a

traffic. And we were driving from a small base called Green Village to a bigger base called HQISAF, the headquarters of like international coalition. And

coalition. And so we got there in 15 minutes and like immediately when I got on the base I was like something is wrong. It should not like when like vibes are off. Why was

there no traffic? I immediately went to like the intelligence kind of briefing center and just started asking everyone like what's going on? What's in the

intel reports? And um and it's one of

intel reports? And um and it's one of these things where like people could tell the vibes were off, but there

wasn't clear intel on what was coming.

And then maybe like an hour or two later, maybe even a couple more, three hours later, there was a like a pretty major coordinated attack. trying to

remember the month. This was like March or March or April 2012.

And so if if you were to put in like HQ staff coordinated attack like green zone or something, you would find the attack.

So there's something like, you know, six different bases that were attacked all at the same time around the country. And

like they at this base they launched a like a rocket into a guard tower and then people so around the base you have like the actual base and then outside

the base you have like the green zone where you had a lot of like Afghan army and it's you get badged in but it's not as much security is going in the actual

like kind of NATO base equivalent and uh and so like fighters went into the they went into the green zone And it's one of these things where like it the

human intuition was so clear that something was wrong, but our intel didn't like >> reflect that >> reflect it. And so like all of my

instincts told me something was wrong and I couldn't find it in the data.

>> And so for me this was like very profound realization that like like we need to improve the data. we

like something is wrong when your instincts tell you that something is off and then you don't have the intel to reflect it and three three hours later you go through an attack. Um so I I mean

that's the literal definition of going into the fire and and just kind of learning how quickly you learn in these situations. My brain for probably three

situations. My brain for probably three weeks was just like obsessing over how could we have known what >> what was going to happen. Yeah. And

there were lots of there were lots of ways to know >> but I won't say them here.

>> Yeah. I know you so you've talked a lot about like curiosity um and why curiosity is like so important and I I when I look at your past it's almost like obsessive curiosity about a

specific subject matter for some certain amount of time and almost in the pursuit of becoming the kind of 2800 chess master like maybe at CS GO at the beginning >> 2700. I've never been 2,800 in anything,

>> 2700. I've never been 2,800 in anything, but I've been 2,700 in a couple things.

>> So 2,700.

>> I was definitely 2700 in Counterstrike.

>> Yeah.

>> Really?

>> Oh, yeah. I mean, I played on like >> some of the best teams in North America.

>> Crazy.

>> I played in Cal Invite and went to top tournaments and >> um >> what made you like initially get into that? Because I know Saurin and Olaf are

that? Because I know Saurin and Olaf are both very obsessed with Counterstrike.

>> I didn't I actually didn't know. It's

amazing. Um

>> or at least one time. The honest answer is one of my best friends was obsessed with it and so he showed me at his house on a Friday night. His name's Brennan. Thank

Friday night. His name's Brennan. Thank

you, Brennan. Like kind of took away three, four years of my childhood. I'm

just kidding. They were very good years and I learned a lot. Um, but no, look, I my friends did it and I think I think a

lot of like when parents ask me that like my kid is obsessed with video games, like it's so bad. I kind of take the opposite view. Like I think kids

being obsessed with almost anything, like it's better to be obsessed than apathetic. And I really learned a lot

apathetic. And I really learned a lot playing Counter-Strike. A couple things.

playing Counter-Strike. A couple things.

One, at the time to be good at Counterstrike, it was an advantage to understand some basic computer networking because to be able to to be able to pick up like an extra 10

milliseconds of, you know, lower latency mattered, like actually mattered.

Second, to be able to like lower the jitter of your home network, like that mattered a lot. And and so like I got into networking. would use wire sharkark

into networking. would use wire sharkark to like try to understand when our home network was having issues and uh and >> try to understand >> I imagine a little bit of that

>> a lot of that but so like it got me into networking um which was very important for me later in life because the company I co-ounded like did a lot of networking

um I also like we used insane tactics and teamwork you know is 5v5 And we would spend so so I I would play

Counter-Sh 3 years that I was doing it. So

seriously, I I would play 10 hours a day, something like that. Um like pretty >> 10 hours a day for three years.

>> Yeah.

>> Is this during like high school?

>> This is 8th, 9th, 10th grade.

>> Okay.

>> I I mean I played on some of the best teams in the world at the time >> and I made some money. Not too much money, but I made, you know, >> a few thousand bucks.

>> Make 10K a year, something like that for two years. Um, so I I mean, which at the

two years. Um, so I I mean, which at the time like at the time the prize pool for CPL, which is the biggest tournament, was 50K for the winning teams, was like

10K per person. And I I never I I actually Yeah. So I never played on the high level at CPL only simply because I was so young. like the Tim of

the teams I played on played there, but I played a lot of so local so-called lands and I won a bunch of land tournaments and stuff and you'd make $1,000, $2,000 a time. Um, and so

anyways, I was really obsessed with Counter-Strike, learned an insane amount of teamwork. It It was like professional

of teamwork. It It was like professional athlete level communications and coordination. you know, when when

coordination. you know, when when someone would say get killed on your team, the whole team has to move their position to change the angles. Like people don't

understand in Counterstrike, >> like at the highest level, everyone has basically the same reactions for the most part. And the difference maker is

most part. And the difference maker is your understanding of like the angles of the game. M

the game. M >> for example, you know, like you want to if there's like a map like you know there was this map DE Aztec. I have all

the maps still in my head. I like I literally I haven't played Counter-Strike in almost 20 years and I I can still remember like every pixel of these maps.

>> I feel you for the the maps I've played.

And so like for de Aztec there was this thing where you go through these two doors like if you're you know a terrorist you're on offense you go

through these two doors and it's this very wide open area on the other side like like long range like call it a couple hundred meters in the human

perception and there's like a big central kind of like dipped courtyard that people can't be in so no one can be there. Um, people can either be kind of

there. Um, people can either be kind of like behind the door, they can be straight down like one direction, they can kind of be behind some boxes or in

the other doors 45° or they can be in the other direction like four places where people can be. You want to have

like two people on your team have be at 90° angles to each other so that if someone when they come through the door almost like pixel level accuracy the

second like their first pixel would come out if they were to come and their orientation was looking at one of your guys and if they ended up having faster reaction times and killing your guy that

the other person would have like almost guaranteed ability to kill them because it's 90°ree opposite angle and so it's like impossible for them to kill that person then scan and kill the other

person. So it's like the worst case you

person. So it's like the worst case you trade one to one uh and so now it's 4v4 but you're giving away the position via

sound. So then that person's going to be

sound. So then that person's going to be at a slight disadvantage like the next time someone comes through the doors but it's still like way better than losing you know like two people. Um,

>> and also everything is like timed when the round starts and which positions you can possibly be in based on the start location.

>> 100%. But so like the second one person comes through the the door, first of all, you have to have like the angle such that you have pixel level accuracy.

Uh, and you have to be in the other team's head to know like, you know, if it's been 15 seconds and you haven't seen anything, then it's

more likely that they're going to bomb site B rather than bombsite A. And so we should start rotating a little bit proactively and having the synchronization with your team to know like literally how to do these small

rotations. It's similar to playing

rotations. It's similar to playing soccer or something like that. It's just

like people adults at least at least at that time now like myself I have two little kids and so I know what goes into these video games.

People do not understand like how the level of strategy and the level of teamwork and coordination winning these games. It was literally like

games. It was literally like professional soccer level kind of obsession and teamwork, but it's a young person's game cuz your

reflexes do by the time you're like 22, 23, your reflexes are like nowhere near as good as a 16-year-old's um or 15 year

olds and so on and on. But I like it I had very bad grades in high school as a result of all the Counter Strike, including an F in algebra 2. Uh but

>> like a 1.8 A or 1.8.

>> You know, there was a period in time when my GPA is 1.8. It didn't end up there, but I but there was a period of time where I got an F in algebra 2. I

ended up doing like a summer remediation of it. And look, I got a PhD in

of it. And look, I got a PhD in mathematical physics. Like, I'm good at

mathematical physics. Like, I'm good at math. The F was I just didn't want to

math. The F was I just didn't want to go. I I hated school. I was really I

go. I I hated school. I was really I could not stand my teachers um or a lot of my peers and I just felt like it was a waste of time. I'd rather be like

screwing around the computer or playing Counterstrike or, you know, doing other things.

>> What was your thought process in school?

I I had a weird situation where I think I was probably in like 10th grade and I talked with one of my teachers. It was

actually algebra 2.

>> Yeah.

>> Um >> where I was like failing that class or something just cuz I didn't really care.

And then my geometry teacher, you know, pulled me aside cuz I I really enjoyed him and his class. So, I got 114% in his class and Fs and everything else. Um,

>> but he pulls me aside.

>> He's basically like, you know, you got to you got to get good grades. And I was like, why? And he's like, to get into a

like, why? And he's like, to get into a good college. And I was like, why? And

good college. And I was like, why? And

he's like, to get a good job. And I was like, well, I don't want a good job and I don't want so then I don't need college and so I don't need these grades. So, what's the point? And then

grades. So, what's the point? And then

he was like, you know, Ty, I can't argue with that.

>> And I just did my own thing after that.

>> Yeah. I mean, it's similar for me. One,

like, I was a hacker as a kid, and the hacker mentality is that you'll always be able to find like a loophole, a back door, side door, and so I was just willing to bet on myself. Like, I I knew

I was going to be fine. I wasn't worried about it, you know? Next thing I had a couple I had some like really adversarial things happen. I'm going to work backwards. Like the most formative

work backwards. Like the most formative thing was in seventh grade, so I'll get there in a second, but in 10th grade, I had I had an experience with a math teacher. I'm not going to name him, so I

teacher. I'm not going to name him, so I don't need to be a jerk. But um on our first test, he gave me a zero on the even got even though I got every answer

right. And I went up to him and I was

right. And I went up to him and I was like, you know, like, "Hey, you gave me a zero even though I got every answer right. Like, what's happening?" He said,

right. Like, what's happening?" He said, "I think you cheated." And I'm like, and he said in a very aggressive way, I'm like, >> because you like didn't show your work.

>> I didn't show any work. And it was for me the problems were so boring that like part of how I'd make them just like 5% more interesting is I'd do it all in my head just to make it like a little bit

more interesting. And so anyways, he

more interesting. And so anyways, he gave me his he said I think you cheated.

I was like no I didn't cheat. Like I was like you can ask me anything you want.

I'm like ask me calculus problems. And he was like nope I think you cheated.

You get a zero. I'm like I got every answer right. like you have to help me,

answer right. like you have to help me, you know, like like like prove to you like ask me anything you want right now.

He's like, "Nope, you get a zero."

>> He just didn't like you.

>> He he didn't like me. And so I went and and can I would read books. I'd read

science fiction books in his class all day. I would just be there reading I I

day. I would just be there reading I I actually counted the books I read that year. I read 67 books in school only in

year. I read 67 books in school only in my classes that year. Um this is easy stuff. It was like Enders Game stuff

stuff. It was like Enders Game stuff like this. Um, so I went to the vice

like this. Um, so I went to the vice principal of the school and told him what happened and that I got every answer right and and he sided with the teacher and at that point I was just

like this is such a joke. These people

are such jokers. Like

later that year I took the SAT and and like I did pretty well. Um, and the school actually reported me to the college board and said that they suspect that I cheated on the SAT. So that's

like that's just preemptively >> just preemptively. Like that's how adversarial my relationship with was with my school. And at that point, I just stopped going to school. I was

like, I'm I'm done with these people.

So, I ended up mainly going to community college then. And then I I left high

college then. And then I I left high school early. I took my California high

school early. I took my California high school proficiency exam like CHSP. It's

a basically GED equivalency and just left and went to community college because I just at that point I could not handle it. But if you want, I can tell

handle it. But if you want, I can tell you the seventh and eighth grade.

>> I would love to hear, >> man. So, seventh grade story is pretty

>> man. So, seventh grade story is pretty unbelievable.

Um, I've got two. These are good stories. I I don't think I've ever told

stories. I I don't think I've ever told these publicly. Anyone from my school

these publicly. Anyone from my school can verify these stories. These are

crazy. Okay, so the first one, I went to public school. My school was 7th through

public school. My school was 7th through 12th grade. So, it's kind of weird to

12th grade. So, it's kind of weird to mix middle school and high school. And,

you know, as a seventh grader, I was 4 foot 10. You know, most kids start

foot 10. You know, most kids start puberty sometime around seventh grade.

And it's like I probably started puberty at the end of seventh grade rather than the beginning. And so there was very

the beginning. And so there was very high variance for kids size, like boys size on the first day of seventh grade.

I was 4 foot 10.

>> I was like four or five until I think like 9th or 10th grade and I randomly shot up a foot.

>> Yeah. Um Yeah. I mean that's tough. So

my second day of seventh grade, I'm 4 foot 10 and I'm walking between my first and second period and there's this kid

Vinnie Terramina who was from a like a pretty powerful family in the school.

His dad had sold a trash company for our earlier conversation to waste management for $500 million. I think it's called like Terramina sortation or something

like that but just Terramina Waste Management. So they had sold this

Management. So they had sold this company and so that's like that's a lot of money especially in the '9s. Um and I believe they had five kids out of the

six grades in the school. Maybe only

four but I think it was five. And so

it's just like you have a lot of power when you have five big Italian kids out of six grades. And so

>> they were Italian too.

>> They were Italian. I know.

and and they had a lot of stranger than fiction. Strange fiction and they had a

fiction. Strange fiction and they had a lot of money and and all of this and so my second day of seventh grade I'm walking from my first to second period and this kid Vinnie Teramina is like

standing on a planter basically it's like a 18-inch planter and he's surrounded by his friends and I'm just walking randomly through the crowd and

he points at me he's like you you your new name is Joel and I was like like what like like me and I'm

surrounded by other people Um he's like, "Your new name is Joel." And I'm like, "Okay." And I just keep walking and I

"Okay." And I just keep walking and I don't remember like exactly which period it happened for, but one of my next

periods, I call it two periods later, I show up and it was it's the second day and I hadn't even been to every class yet with every teacher. And I show up in

a class and the teacher calls roll. And

they don't call my name. And so I I say like, "Hey, like, excuse me, you know, like I think I'm in the right place, but you didn't call my name." They're like, "What's your name?" It's like, "My name is Sean Magguire." And the teacher's

like, "No, I don't see you on the roll."

So I go up to the podium where she's standing with like a paper roll roll card. And um

card. And um she had crossed out Shawn Magcguire and written in Joel. And I'm like, "Oh, my name's not Joel." Like, "It's Sean. It's

Sean Magcguire." And some kid yells out, I'll just name him Kyle Tombberlin.

Yells out, he's a good guy. He's a

fireman now. Like, it's hilarious. He

yells out um like, "My name's not Joel, it's Shawn, it's Shawn Maguire." And he yells it out in like a voice like that and like people laugh and I'm so confused and I'm like, "No, my name's

not Joel. It's like it's Shawn, it's

not Joel. It's like it's Shawn, it's Shawn Magcguire." And then like six kids

Shawn Magcguire." And then like six kids yell out. They're like, "My name's not

yell out. They're like, "My name's not Joel. It's Shawn Maguire." And uh then

Joel. It's Shawn Maguire." And uh then the whole class is laughing and I'm just like I'm so stunned. I'm like, "What is happening? I'm so confused." And so I I

happening? I'm so confused." And so I I deal the teacher. I'm like like that's me. And she marks me or whatever. And I

me. And she marks me or whatever. And I

go sit down. And then this happens in every class I go to like with every teacher. And whenever I try to correct

teacher. And whenever I try to correct the teacher and then these kids they they they're kids are smart and they go to the teachers ahead of time and they're like this Sean kid is a class

clown like he like like he actually his name is Joel but he's going to mess with you. And so then the teachers are

you. And so then the teachers are confused and then like the class is laughing and they think I'm a class clown and it's like and they they literally renamed me to Joel. Like I'm

not I'm not joking. They literally

renamed me to Joel my second day of seventh grade. And for my whole high

seventh grade. And for my whole high school experience, like people called me Joel.

And not everyone, but like most of the kids and like the cool kids called me Joel. I still today like it's programmed

Joel. I still today like it's programmed in me. If you yell I shouldn't say this

in me. If you yell I shouldn't say this on, you know, online, but it. Like

if someone yells Joel, I'll turn around the same way. If someone yells like Tai, even from 100 meters away, like you'll turn around.

>> Even if they say T.

>> If someone says T, like you'll turn around. If someone says Joel, like I

around. If someone says Joel, like I turn around the same way I would for song. It's just hardwired in me. And

song. It's just hardwired in me. And

there's people like there's still people from my high school that still call me Joel. There were even I went to a high

Joel. There were even I went to a high school reunion like 10 years ago before I had any online presence or any of these things. And some of the kids there

these things. And some of the kids there only knew me as Joel.

Like they didn't know that my name was Sean. Like they did not know my name is

Sean. Like they did not know my name is actually Sean. And this was one of these

actually Sean. And this was one of these things like it was just such a weird way to start seventh grade where you get renamed. I just like man this

renamed. I just like man this place. Um forsworth I ended up seeing

place. Um forsworth I ended up seeing Vinnie at a party after like >> his name was Vinnie.

>> Yeah. Vinnie Teramino. So I ended up seeing Vinnie after after college and >> Vinnie the Italian with Vinnie the dad with a trash collection company.

>> Trash company that sold for $500 million. And so I end up saying to

million. And so I end up saying to Vinnie, I'm like, "Dude, like what was going through your mind?" And he's like, "Um,

he's like, "You know what, man?" He's

like, "I was really hung over." And he's like, he looked like a kid I met named Joel Jacobson. And he's like, "It just

Joel Jacobson. And he's like, "It just came to me." He's like, "I'm sorry."

his high school experience has ruined herself for being hung over because a kid was hung over on his second day of 10th grade and just randomly decided to

rename me uh and it stuck and and so I was like, "Wow, this is, you know, this is parody." Um

is parody." Um >> so you're just getting hazed immediately.

>> Yeah. So that was that was one story that just it's like, man, this place is like this place. This

The second thing, and this is this is like really funny. Um, my school was Lord of the Flies. Like, it's really hard to explain what this place was

like, and we had a PE class.

Coach Tger was the instructor. And I

think we would meet three times a week, and we had to be there, it started early. We had to be there at like 7:30

early. We had to be there at like 7:30 or something like that. And for it was like 90minute PE class. And this guy, Coach Tger, would always be 15 minutes late. We all had to go change in the

late. We all had to go change in the locker room. We all wore a uniform. It's

locker room. We all wore a uniform. It's

just like it's public school. Like very

cheap like mesh blue basketball shorts and a gray t-shirt that said Sea Kings on it, which was our mascot. And one

day, this kid who's like a very charismatic kid in the grade, he decided to rip off his sleeves just to be cool.

So he he shows up to like the beginning of class and coach Trigger walks in, as I said, he's always 15 minutes late and he's like, "Ela, LA, what happened to your sleeves?" And

LA is like, "Oh my gosh." He's like, he's so smooth. He's like, "You know, I got a hole in one of the like you got a hole in one of the sleeves and it didn't look good and like it just kept growing." He's like, "So I had to

kept growing." He's like, "So I had to rip the one sleeve off." He's like, "But then when I had the one sleeve off, he's like, "I felt like I had to rip the other one off cuz it wasn't symmetrical." like so I took the other

symmetrical." like so I took the other sleeve off and it was like a good story and so coach Sugar's like okay and it's public school so you don't get like another shirt um and so the next day

probably five or six more kids of LA's friends they all come with their sleeves ripped off and coach's like like guys what happened to your sleeves and they're like oh like same thing as LA

like I got a hole and you know and like so like I it didn't look good and so I had to rip it off and then when I ripped one off like it wasn't symmetrical so I had to rip off the other so like there's like six kids. So then like the next day

it's like 25 kids. And so then like the next day, the fourth day, these kids, cuz this guy was only 15 minutes late, these kids. And it's like it's so funny

these kids. And it's like it's so funny to look back on it, but they would go and they would go to all the kids and they would rip people's like they would

chase kids down and they would rip their sleeves off. And it's just a way of like

sleeves off. And it's just a way of like showing dominance over other kids. And I

didn't want these kids like I didn't care about the sleeves, but I didn't want to be dominated by these And so I was I was a really fast runner.

>> Were you like preparing mentally through those days as you see more and more things going? So I I am like I am an

things going? So I I am like I am an extremely fast runner and this is not the best way to justify like I've won four marathons or something like that

and and I've done that without training or trying and you know my marathon PR my pace is like five 5 minutes 37 seconds minute per mile and that's literally

without training like that's just I'm I'm fast. Um and my I had a friend Chris

I'm fast. Um and my I had a friend Chris Ringstrom we were the two fastest kids in the grade. Chris ended up running the hundred at Stanford and Chris and I, we

didn't want these kids rip our sleeves.

So for weeks, like for many weeks, every morning, I swear to God, every morning, we'd have 20 plus kids chasing us for like 15 minutes. They would chase us. We

had a pretty big campus and there was two big fields and like a lot of other just like cement. And uh we would we would literally get chased by at least

20 kids for about 10 minutes every morning for weeks just to not let these they want to show that they're dominant and we the last two kids without our sleeves ripped and so we would just go

run like crazy to not get our sleeves ripped is lord of the flies like it's absolutely insane and they never ripped our sleeves and uh there's one thing where our

school was close to a bay. It was in Orange County, California. just close to the Back Bay and a lot of seagulls would it was like their hangout spot in the morning almost every day was on our one

of our fields and so we would like run into the seagulls and it's hundreds of seagulls would take off we'd run into them and they would

invariably like the seagulls when they take off like because it's like they're digesting while they're sitting there and then they poop when they start flying away. So hundreds of sequels

flying away. So hundreds of sequels would take off and like a small percent 5% would take shits and like almost every morning like one or two kids would get on that and it's just it's like

it's hard to even explain what this was like and this so this the this is my seventh grade experience is it was like getting renamed to Joel and running away

from wild >> packs of kids that want to tear my sleeves off just to establish dominance.

And I'll share one more on this. Like

this is a quick one. Um

my school was very good at tennis. It

was like a it's a big thing in the high school and cornar high school.

And so we had nine tennis courts on campus. Um and one of the activities we

campus. Um and one of the activities we did in PE for like six weeks was like paddle tennis was these plastic rackets with holes in them. And uh he'd play 3v3

on the tennis court with a tennis ball in these plastic rackets and it was round robin like if your team won you'd move up and if you lost you'd move down

and these uh like there was this one team of three guys and like they were three of the more athletic guys in the grade and they kind of made it there like another way they would establish

dominance is when they would be playing people they would deliberately try to peg them with the ball. Uh,

>> you just surrounded by >> I was surrounded by And so there was this like team of three guys, one of whom again was this LA kid. And

they were good. And they would peg.

There was this one kid, John Moff. I

shouldn't name him, but like he was a I'm sorry for naming you. He's a tall, very sweet kid, like uh very like very awkward kid at the time. And they would

just peg him relentlessly with the ball.

But I was my my dad was an was a very strong tennis player and like I grew up playing very competitive tennis and

um and so like I could I was better than these kids and so because they would go try to peg other kids like I would peg >> you wanted to seek justice. I would seek justice on behalf of like this kid John

and all the other kind of nerds and I would make it my sport to peg these kids. And so they just absolutely hated

kids. And so they just absolutely hated me. And I was like my whole my whole

me. And I was like my whole my whole school experience like I had teachers that will give me zeros for like not showing my work on tests and I have kids that are like trying to rip off my

sleeves to establish dominance and a kid renaming me. It's like I don't even want

renaming me. It's like I don't even want to be here.

>> And then you go home and you play CS for 10 hours.

Yeah. So, it's like it was it was a kind of an unusual and maybe this is usual. I

don't know. But for me, like I just did not want to be in school.

>> I think I think everything, you know, we discovered a lot more context to >> There's more context. Yeah,

>> we got more context.

>> It's important to have a chip on your shoulder.

>> You've got a few chips.

>> Yeah, I've got a few chips. Getting back

to uh Elon and having I think Elon has got a few very close relationships that he's just had for a very long time.

Quinn Shotwell is one of them. Uh Steve

Davis I think is going to be another. I

forgot the guy that is working on Neurolink, but it's the same thing. How

how do the people that really succeed where they're working kind of on one of the Elon companies with Elon, how do they work? Yeah, my my

they work? Yeah, my my personal opinion is that um one like

the way Elon operates is kind of anyone can raise their hand to do a job. Um

>> have you actually been in one of these meetings where that happened or like some guy >> it depends on the context? Um, but if someone like volunteers to do something,

if they actually deliver on it, then great. Like they move up, you know, and

great. Like they move up, you know, and they'll be taken very seriously and they kind of move up the next level. If they

volunteer another time and they deliver, like they'll move up again. On the other extreme, if you say you can do something and you fail to do it, like you are, you know, you are done. You or you or or

you're stuck there. Um, so number one is like just being extremely competent and being willing to bet on your own competence and and like always delivering and knowing your limit. Like

it's okay to say I don't think I can do this or you know I don't know how to do this or I think someone else will be better for this. Um like it's different to volunteer for something versus be

assigned something. Um you know the next

assigned something. Um you know the next thing is very very quickly learning that you need to go like five levels deep.

you need to be able to handle like five levels of questions or so in anything.

And I think the like the next thing is, you know, a lot of loyalty. And I don't mean that like I think a lot of people would take that would misinterpret that

and think like, oh, it's blind loyalty.

No, it's not blind loyalty. It's it's a understanding that Elon sees things other people don't see. I

think of Elon like Alph Go. where Alph

Go would make these moves that like Go players couldn't even understand why AlphaGo was making these moves and then 17 moves later like AlphaGo would just

win and they're like, "Holy crap, that was crazy." This is kind of like what

was crazy." This is kind of like what it's like to work with Elon where he'll do these extremely >> chess moves, >> 60 chess moves that you just like people don't understand in the moment and then

you'll understand it a year later or 6 months later >> and it'll look like prophetic >> and it will look prophetic. And so

people that go and don't understand that I like that's challenging and people that say like leak the plan, you know, or like that's

another type of loyalty. I like the this is like it's like trust in the system, trust in where you're going like like be

like loyal to your teammates um you know be missionoriented like these are if you have all of those things in addition to the like competence and being willing to bet on yourself like you're going to do very

well and believe it or not I think very few organizations like do those things. It sounds very simple but like no one does that. Yeah,

it's very it's very interesting because like in that I guess in his organizations you can't actually ask for responsibility and get it the first time in a way that a lot of things it's kind

of even on with like interviews and stuff for a very long time I would ask and I >> like sometimes it worked. Yeah.

>> Right. And that's a that's a amazing feeling. Um, do you think that he kind

feeling. Um, do you think that he kind of takes a similar approach to investing where you're basically backing someone based on some track record with them saying I'm going to go change this

aspect of the future and then you know that's like the preed and seed and so on. the way. So I think he's one of the

on. the way. So I think he's one of the greatest capital allocators of all time obviously with across all the different companies across like you know investing

in battery factories like when he did investing in AV when he did you know to to to the point where like it actually works like a lot of people that invest in AV it never worked. They were either

too early or the earlier low Earth orbit constellation internet constellations like they were too early. The underlying

phaser array radio technologies hadn't you know made it weren't mature enough to where you could actually build a full system that you know achieved the performance you needed to have like to

to compete with terrestrial internet.

he's this combination of like I think such good instincts for where the technology is and like where it will be in the near term. Um so

that's all I think pretty obvious. I

think the thing that is maybe not obvious is I think he sizes his bets in very smart way. So, like I don't remember the exact year of when SpaceX started working on Starlink, but it was

something like 2013, something like that. But it wasn't that serious of an

that. But it wasn't that serious of an effort. They were waiting until like

effort. They were waiting until like Falcon 9 became reusable. Falcon 9

became reusable in 2016. I roughly I think there was two years of like working out the kinks. It was around 2018 is when I think Elon just fully understood that all the pieces are in

place like the underlying phase array radio technology is good enough and like reusability is really working which

means that the economics like of launch cost to get mass to orbit is is going to is like going to be really really favorable and the number of missions you'll be able to fly per year is going

to increase a lot because it's just way easier rather than needing to make a new to be you know now I think SpaceX now

has done 170 flights in the last 12 months like as of yesterday and you know when we first invested it was like 10 a year something like that six

years ago um >> so 17x in six years that's not bad >> in terms of number of missions like it's

pretty wild and the like by having reusability it was a key point to be able to do a lot of flights per year. So

you didn't have to make new rockets, new boosters, etc. Well, you still make the second stage, but um anyways, like he just has unbelievable

intuition and like the Starling bet was a small bet. It was going but it was like small to be learning so that you're paying close attention and you even know you need to make a small bet to know

what the constraints are so that when the constraints get removed or improved you know and then you can size the small bet to a medium bet and then once the medium bet is really working and like

the unit economics are good then you can scale it to big bet and I I think he's an absolute genius at sizing like yes he's a genius at understanding the

having intuition for the technologies and understanding what are the constraints. But I think he also is a

constraints. But I think he also is a genius at sizing his bets in a smart way. This is somewhere like a poker

way. This is somewhere like a poker player needs to size their bets proportional to the quality of their cards, you know, >> and also like the amount of chips they have and the chips on the other guys

>> 100%. And like hedge fund managers a lot

>> 100%. And like hedge fund managers a lot of times like if they have some vague new idea but they don't fully understand the business like you'll buy you know you'll put 1% of your fund into buying

some new position just to start really learning the company. It's hard to learn it from the outside >> emotional tie to it.

>> Yeah. And get an emotional tie and like start to get to know the management team or whatever. And then if your thesis

or whatever. And then if your thesis proves correct you'll size that 1% to like 5% or 10%. And like I I think that

it's he's he's under underappreciated in terms of like how good he is at sizing the bets.

>> Do you think that that was a learned trait? Cuz I I've I've listened to all

trait? Cuz I I've I've listened to all the books on him. I've listened to every interview he's ever done. Uh at least that that are public multiple times probably. And I I like to think about

probably. And I I like to think about the the Elon that we see today is not the same Elon that was building, you know, Zip 2 and PayPal and X initially.

Um, and then also the same person that like initially sells PayPal, takes all that cash and puts it into SpaceX.

>> Look, I think that's probably true in the sense that I think Elon compounds himself more than like any other just a learning machine.

>> He's a learning machine and and that like that's exactly where I was going.

And part of it is he once you have so much success, it's just usually you don't want to embarrass yourself. You

don't want to look stupid. You don't

want to like make mistakes. Elon is just still so unafraid to get embarrassed.

And even something as simple as doing Starship testing in public um which like you have to bear all these New York Times articles, you know, where they're

like they're up failed test failed star like Starship fails to achieve its goals, you know, like fails to reach orbit like orbit wasn't even our goal. Um

our goal. Um but like when you're just willing to be in the arena all day every day trying things like learning getting and like or

getting embarrassed that's how you really really learn and to do that at the scale he does like of course he's not the same person he was 20 years ago.

He's he's like he's at the cutting edge.

>> The best investments are contrarian and right.

>> Yeah. What have been the biggest points where you decided to be contrarian and were wrong?

>> I mean, I was negative on Nvidia like three years ago, which was obviously incredibly unbelievably

>> postp launch.

>> Post ChachiB launch. So,

I've been a giant I I literally bought Nvidia shares in the IPO >> in 1999.

>> What?

>> As a 13-year-old. Um I because I was playing video games like I was using >> You were using the graphics cards. Yeah.

>> Yeah. So, I I would buy like Nvidia, AMD, and Intel stocks and I would do Paris trading based on, you know, what generation of graphics cards I thought would be better or what generation of

CPUs. Um because at the time like these

CPUs. Um because at the time like these the GPUs run an annual cycle so were the CPUs and it was one of these things where like to the to gamers you would

buy for your next build like if AMD was 5% better than Intel like with CPUs you would buy the AMD CPU. Um and

>> like the best machine.

>> Yeah. You wanted the best machine, the best bang for your buck. And people were actually very very in tune with like very the gamers were unbelievably in tune with the product cycle. And so I

was obsessed with Nvidia. I literally

bought the stock in 1999. Um, and I I traded it a lot. And then I I was holding Nvidia until like a 600 billion market cap.

>> I was holding >> Didn't they go public for like a few hundred million?

>> Yeah.

>> Yeah. Okay.

>> So, I was holding Nvidia to like a 600 billion market cap. And

at that point, one thing that's actually really like a crazy lesson like I underestimated Jensen to be honest.

Um, even though I had been a shareholder of the company, like I didn't I didn't think Jensen was as good as he is. like like man like he

is he's he's really good and he's really pushed his advantage in an incredible way and he's been so aggressive and I I don't think it was as obvious as people

might think now like if you go look at his earnings presentations 10 years ago or whatever and it had been a very sleepy company for a long time it had

primarily been a game you know like originally gaming company gaming customers And um when we go I don't remember the exact numbers

but like 3 years ago roughly three years ago the revenue was it is like right when it

flipped from being like half half consumer to half data center.

I don't remember the exact revenue.

>> They do tens of billions, I think, or like >> I think it was like they did a quarter.

It was like four billion of gaming revenue, four billion of consumer, sorry, of data center revenue, and it

was like a $600 billion stock. and I

sold um and at the time I was just like this thing is trading at such a crazy multiple and it's >> have Benjamin Graham in the back of your head

>> Graham in the back of my head. Uh, and

the other thing is like one I I underestimated Jensen. Two,

I think that the market, you know, like I'm going to get crushed for saying this, but I think the market was a little bit irrational at that

point. And but then the irr Jensen

point. And but then the irr Jensen played the irrationality of the market so well that then it became a self-fulfilling prophecy and I'll

explain this a little like at the time.

So I think so Nvidia bought Melanox in like 2019.

>> Was that like 8 billion I think >> about 8 billion.

>> Yeah.

>> I think this is probably the best acquisition in history. one of those chess moves where it doesn't totally make sense at the time and then >> one of probably the best acquisition history and gave Nvidia like a huge

interconnect mode which is gigantic like seismic u and just exactly right time hardware time scales are long you know

like from the time that >> like from the time the data center boom became obvious like it's like four years before someone like AMD or Intel will will catch up on the interconnect side

and on the whole system side >> and the data center and AI thing came so abruptly on the back of chatg that they were actually already working on these things it just wasn't Nvidia had made it

it's like sole focus and had done the Melanox acquisition >> Jensen has got a special ability to like be willing to look wrong for very long time >> he has a lot in common with Elon and I

actually did not understand that at the time um but so yeah really he has a special gift for that. But so anyways,

I knew what was on the road map of AMD and Intel and I personally feel like if you go back to two and a half years, like if you were to go another 18 months

from now, that their the technology they were going to put out was would be like roughly at par with where Nvidia would be in four years. Back at that point

when Nvidia was a $600 billion company.

Um, but what happened is Nvidia became so valuable like and Intel and AMD became so like cheap, they had to cut a

lot of their investments and Nvidia was able to just like wildly ramp up their own investments. And so now I don't

own investments. And so now I don't think Intel and AMD will catch up. Like

it's my personal opinion. is not

investment advice or anything, but like I I think that we live in a different the timeline was altered because of how well Nvidia traded and how well Jensen pushed that advantage. And I think this

probably was knowable if I would have known just how good Jensen is. Um, but I also felt like the market was underappreciating

like how good the AMD and Intel projects were in the hopper in their hoppers, but they're they've been like jeopardized because they got so suppressed by the

Nvidia tsunami. And so this is one where

Nvidia tsunami. And so this is one where like I'm embarrassed because I was like very I mean I even had one tweet where I was like said something like I think Nvidia is overrated and like

>> this stuff doesn't make sense. Yeah,

this stuff doesn't make sense. Um,

>> so it's like obviously I was wrong based on the financial performance and I think I was wrong in terms of how good Jensen is.

Uh, and I think I was wrong in terms of understanding like how well they would push the advantage. But I also think the irony is like I think a lot of so many

like so much of the capital that went into Nvidia over the last two years is people that have never done anything in hardware companies. They don't know

hardware companies. They don't know anything about semiconductors. Like I

bought Nvidia and the IPO. I've been

obsessed with TSMC for 20 years. I've

been obsessed with ASML for 20 years.

Like and and so it's just I kind of want I've been obsessed with Broadcom since I was a little kid. Like literally obsessed.

And >> I think Broadcom I mean even even that company hasn't really like fully realized it's it kind of had almost an Nvidia Tesla-esque moment over the past

3 four years. Broadcom's a kind of a misunderstood company in many ways. And

like this is a crazy I'm going to embarrass myself. Like I did not grow up

embarrass myself. Like I did not grow up rich at all, but when I and my my town where I moved to when I was nine is a

very rich town though. And like in my high school, it's kind of crazy. The

like one of the daughters of Henry Samuel was in my class. Um

>> you're just surrounded by wealth. Well,

I was surrounded by like I think my school like in my school there were kids whose who were like Mexican-American immigrants whose parents were house

cleaners and like I had a friend I had like I had a friend whose parents were journalists like of like the local paper

and he dated the daughter of a billionaire like another silicon billionaire. I'm not going to name them.

billionaire. I'm not going to name them.

They're amazing. All of those people are amazing people, but my school had like six orders of magnitude of wealth. Like

literally, it was insane. But so the founder of Broadcom, Henry Samueli, his daughter was in my class. Like like

literally in my class and I went to like a school dance party at her house and I've been obs they were the wealthiest family in the town. And so I've been obsessed with Broadcom from a young age

because whenever there's like the wealthiest family around you, it's like how do they make so much money? What do

they do? and happened to be very lucky that it was from Silicon. So I've

literally I've been obsessed with Broadcom since a young age. Obviously

like Henry and Henry and Nicholas III were both at UCLA. Henry Samuel was a professor at UCLA and Henry Nicholster was his grad student and they started Broadcom and the company's evolved with the products quite a few times over

history. But then there was kind of the

history. But then there was kind of the reverse merger with Aago and you know Hawk is an incredible like he's an incredible capital allocator and you know they bought VMware and rolled up a

lot of things and so Broadcom is this weird company where like they have like this unbelievably rich history in telecommunications hardware and then in

like data center hardware, but they also have been this just like unbelievable private equity machine and bought VM

somewhere. Um, but Broadcom today has

somewhere. Um, but Broadcom today has been an incredible innovator in kind of like next generation data center

components and like they're the first people to have like a working what's called co-ackage optics product and I I am personally incredibly bullish on this thing called silicon photonics.

mentioned earlier, if I was going to do one of two things to, you know, turn 10 billion into Bell Labs, like the two things would be starting a chemicals company or or doing Silicon Photonics

Fab and and like Broadcom is one of the companies that inspires me >> the most. And so I'm I'm weird in that like I've loved this space since I was a little kid. And then I watched these

little kid. And then I watched these people enter this space two years ago like don't know anything. I was like, man, this is you have people that don't know anything like

They can't tell you anything. They don't

know what Melanox is and they're like saying this thing is going to $3 trillion. And I'm like, "Okay, I'm out."

trillion. And I'm like, "Okay, I'm out."

And I I made a little video at Sequoa saying like, "Why?" Like I I said I would for what to my credit, I said I would never short the stock because like I'm very afraid of the irrationality

around it and I didn't know like the scale of what AI buildouts could be. But

I said like I'm a seller at 600 billion.

So anyways, that was very wrong and man, I wish I would have hold held, you know, for that other 8x.