Uncapped with Jack Altman
· Jack Altman, Kevin Hartz
[00:00:00] S0: So you guys are investing at the earliest stages where you’re basically just looking at teams. There’s an idea, but probably not much of a product, and the idea is probably squishy. You’ve got this backdrop where this is both the most exciting time ever and a scary time in certain ways as an investor. So what are the founder attributes that you look for right now? If there’s any contrast to what you looked at in the pre-AI cycle, I’d be interested in hearing that too. [00:00:00] S2: There’s a curious movement around age, in that founders are getting younger. I guess they’re not aging in reverse, but— [00:00:00] S0: No, it’s wild. [00:00:00] S2: They’re getting into— [00:00:00] S0: Just look at a YC batch. People in their teens. [00:00:00] S2: I bet they have great data on that. [00:00:00] S0: Yeah, it’s going young, for sure. [00:00:00] S2: It’s interesting. In the late seventies when Steve Jobs founded Apple and Bill Gates founded Microsoft, they were 19. Then you fast forward and there’s some other examples along the way. Then you had Zuck, and then you really had this accelerate. You had Peter Thiel and Luke Nosek devise Thiel Fellows in 2010. That was very prescient. [00:00:00] S0: It’s been incredibly successful. [00:00:00] S2: Yes, and it’s a nonprofit. [00:00:00] S0: It was unbelievable. [00:00:00] S2: It was very prescient of what was coming, which is this lowering of the age and dropping out. [00:00:00] S0: But it wasn’t quite like this right before AI.
· Jack Altman, Bennett Siegel, Kevin Hartz
[00:00:00] S0: But it wasn’t quite like this right before AI. [00:00:00] S1: It was never like this before. There always were young founders building incredible businesses. But you and I have spoken about this. In this paradigm shift, who cares if you know how to build a SaaS product, or sell a SaaS product, or hire a traditional enterprise go-to-market team? This is new for everyone. We’re all rewriting the rules as we build these companies in real time. Young founders are situated very well because they’re the first adopters of this technology. So it’s why you’re still seeing very large companies built by people under the age of 25 or 30 at an unprecedented rate. For us in practice, that means more and more of our founders are skewing younger and younger. [00:00:00] S2: Just the other day I was speaking to a founder going over some documents, and he said he would run things by his lawyer. I said, “Isn’t your lawyer your mother?” He’s a teenage founder. And he sheepishly said, “Yes, she’s a good lawyer by the way.” [00:00:00] S0: That’s good. What else besides age? We were talking about durability and the world is changing. What other attributes, aside from just young founders, have certain advantages now?
· Jack Altman, Bennett Siegel
[00:00:00] S0: That’s good. What else besides age? We were talking about durability and the world is changing. What other attributes, aside from just young founders, have certain advantages now? [00:00:00] S1: We generally map talent, not markets. To be a seed-stage investor, you have to be founder-centric, but you also have to recognize what’s happening around you. The labs are not just infrastructure companies now. They are legitimate competitors at the application layer, which happens to be where most seed-stage companies are building. That’s where you raise an initial round and launch a business. Obviously there’s codegen, which is the central battleground, but it’s going to proliferate to every part of knowledge work and every part of the enterprise. We do try to think about where there’s white space to build, or where you can have enough of a runway to finally build differentiation. Nobody is differentiated at seed. This whole idea of, what makes this different? Why couldn’t your competitor do this? Every seed-stage company could obviously be disrupted or built by an incumbent. We need to figure out where there’s at least enough white space, enough of a runway, that you can start to achieve liftoff. [00:00:00] S0: When you say you map talent, what does that look like in practice? What does a day look like? Is it just reaching out to interesting people in certain networks? Are you tracking people that you’ve already known? What does it actually tactically mean to map talent?
· Jack Altman, Kevin Hartz
[00:00:00] S0: When you say you map talent, what does that look like in practice? What does a day look like? Is it just reaching out to interesting people in certain networks? Are you tracking people that you’ve already known? What does it actually tactically mean to map talent? [00:00:00] S2: It’s a lot like mining, where you’re in a vein of gold, you’ve found an area, but that exhausts itself and you’ve got to find new talent and new areas. I don’t know if that’s a good analogy, mining, but things are constantly switching. The founders are always the same. They’re always those that have had to overcome some kind of obstacles and still achieve at a very young age, and be able to recognize the signs. We’ve gone through this big phase of IOI and all the coding competitions and things of that nature as a measurement for teens that are achieving on that side. So you’re looking for these types of attributes, but the reality is— [00:00:00] S0: Jane Street, I feel like, has been a really good one recently. There’s been more interest from ex-Jane Street people to be in startups. Obviously it’s a very talented group.
· Jack Altman, Bennett Siegel, Kevin Hartz
[00:00:00] S0: Jane Street, I feel like, has been a really good one recently. There’s been more interest from ex-Jane Street people to be in startups. Obviously it’s a very talented group. [00:00:00] S1: This isn’t some unique insight, but high-quality people want to hang out with high-quality people. So when you go to the top universities, when you go to the accelerator programs, when you go to companies— the most talent-dense nodes work very closely together. As you start to work with founders in those nodes, you naturally meet their friends who go on to start great companies. I also think, as you see people leave companies, you see certain patterns. Certain companies breed better founders than others. Airbnb, Stripe—so many of these companies are magical businesses. They worked, and not to say there wasn’t hardship in the early days, but when they took off, they really took off. So it doesn’t necessarily breed as many founders that run through walls to start companies. Palantir is an example. Everyone’s a mini-CEO. Everyone had to build and launch a product and find product-market fit. It’s why I think Palantir has the highest per capita rate of unicorn founders of any company. Part of what we need to do is continue to find those areas where the next founders come out of. [00:00:00] S2: We love those Palantir founders. [00:00:00] S0: They’re fantastic. [00:00:00] S2: You can’t get enough. They’re so good. Whatever they feed them over there is really working.
· Kevin Hartz, Jack Altman, Bennett Siegel
[00:00:00] S2: You can’t get enough. They’re so good. Whatever they feed them over there is really working. [00:00:00] S0: I also think probably with Palantir there’s a certain non-consensus mindset implied simply by wanting to work at Palantir. At least, that was true at a certain time. Now it’s maybe become a bit more mainstream. But I think for people who worked at Palantir and Anduril at a time before it was popular, on the contrary it was something that you had to defend. That takes a certain mindset that is related to being a founder. [00:00:00] S1: One thing we didn’t talk about: there’s a whole new crop of founders that never existed, at least in my time of doing venture. It’s the researchers. It’s folks that are leaving labs or PhD programs that are raising massive quantums of capital. [00:00:00] S0: By the way, it used to be a big anti-pattern. What, like, researchers? [00:00:00] S2: Yeah. That’s hard. You’re totally right. Researchers tend to have high intellect, but— [00:00:00] S0: Academic. [00:00:00] S2: Not as commercial. [00:00:00] S0: But now obviously there’s all these counterexamples for maybe the first time. I’m sure there were examples in the past, but that’s a whole new thing that people have to grapple with. It’s very hard. [00:00:00] S2: It is. I think that’s where, when you’re spending time with the founder and getting to know them, if they can really articulate what they’re doing, you have to listen so carefully. A great founder will have every word very much have great meaning and intention about what they’re going to build.