01:28:23 · Jordi Hays, John Coogan, Vineeta Agarwala
[01:28:23] S0: Family round to get a friends and family round done. [01:28:26] S1: Exactly. So if the Airbnb guys, I think had showed up to Kleiner Perkins or Sequoia, who actually I think wound up doing the Airbnb deal later. I think Sequoia did. Pre YC, that might have been like, this is a little weird company. This is a little bit out of our sweet spot, but then you go through YC, you get coached by Paul Graham at the time and you polish things up such that you're ready to go and ready to talk to the big firms. And Paul Graham, I think famously told the Sequoia partner like you should do the Airbnb deal even as weird as it is. Like think about you know eBay for space and it worked out. Fantastic story. [01:29:00] S0: Pretty much good. [01:29:01] S1: We have Vineeta from Andreessen Horowitz in the studio. Welcome to the stream. How are you doing? [01:29:06] S7: Hello. How are you doing? I'm your Airbnb fan. [01:29:09] S1: Yes. What yeah. What's your what what what's your take on this on this a 16 z changing the game by recognizing that everyone was undervaluing startups and massively overbidding for early rounds? What do do you think that resonates? Do you feel like Andreessen Horowitz has changed the game in venture? [01:29:25] S0: Totally unbiased. Take two coming out.
01:29:25 · Jordi Hays, Vineeta Agarwala, Casey Neistat
[01:29:25] S0: Totally unbiased. Take two coming out. [01:29:28] S7: Totally unbiased. I do believe my partners are changing the game. No. And part of what's amazing about a 16 z is our willingness to bet in every sector, every vertical, every part of the economy, really every part of the economy, you know, both locally, domestically, and globally. So my corner of the world, it's a big corner [01:29:45] S6: of the world. [01:29:45] S7: It's a $5,000,000,000,000 corner of the world is health care. Yep. And one of the things I love about our firm is that we've really established a dedicated strategy here too Yep. And hopefully changing the game here too.
01:29:45 · Vineeta Agarwala, John Coogan
[01:29:45] S7: It's a $5,000,000,000,000 corner of the world is health care. Yep. And one of the things I love about our firm is that we've really established a dedicated strategy here too Yep. And hopefully changing the game here too. [01:29:57] S1: Yeah. Has, how has bio investing, healthcare investing changed? We were talking about the Airbnb example. It feels like it's it's it's easy for a couple folks with just a hope and a dream. They don't need to do a friends and family round. They can just go to Sandhill Road. They can go to places like YC. They can go to Andreessen Horowitz directly and and raise a seed round and have enough to actually pay the bills, hire a couple people, do a couple tests, launch a consumer app, launch an enterprise app. Has there been a meaningful change in the way health care and bio companies get started? For a long time, it felt like the only way to do a company in that space was you're at MIT and you do some partnership with Flagship Pioneering and then you IPO and then you're living and dying by your FDA trials. The traditional venture path felt very just like a completely separate track, but how has it evolved from your experience?
01:30:53 · Vineeta Agarwala
[01:30:53] S7: Yeah. Great question. I mean, I think we're absolutely part of the agentic wave. I've never seen so much interest in the role of AI agents in transforming how science is done, how research discoveries are made, how drugs could be developed. The FDA launched an AI agent called ELSA, cute name, but, you know, potentially signaling, you know, a transformative role for AI even in the regulatory agency, which is kind of a mind blowing mind blowing thing to think about. Right? You would have thought that it would have been the innovators and the start ups kind of pushing AI first and then waiting for the regulator to say, yes, we believe these predictive tools are going to help us make drugs. So I think we are seeing a really different market pull than ever before. At the same time, the business models in health care, you know, are still similar, and the core products that drive value are still similar. So we're in the business of making new medicines, so are the startups that we back in large part, or making the practice of medicine way better and transforming the practice of medicine. And both have some really established business models around them. Drugs that work that have an impact on patients get paid for. They get paid for because they save the system money. Services, we pay for because people need services on time at you know, from the right specialist for the right disease. And so those are all, you know, great business models in which to in which to invest and in which startups can run. But certainly startups are now running in a much more capital efficient way and a much more AI powered way than they ever were before. We need good agents in the game Where in our space
01:32:33 · John Coogan, Jordi Hays
[01:32:33] S1: is Silicon Valley's sweet spot or like strike zone in bio? Because I I was reading the Wall Street Journal today about a company that does, they're developing robotics for lab testing equipment. So basically like pipetting, you know, famously it's like a PhD student just going like this all day long. Bunch of robots doing that. Makes a ton of sense. That feels like Silicon Valley all the way. Same [01:32:54] S0: How thing how many cursor for bio pitches have you you got? Is it is it in the hundreds? [01:32:59] S1: But that feels like more in the sweet spot. When I think about like an ERP system for for biotech companies, that feels a lot easier than saying, I'm going to take a cancer drug through the FDA trials and I'm never going to go public. I'm going to raise growth rounds at every stage. Like we haven't seen that much, but maybe we're still just early in that trend changing.
01:32:59 · John Coogan, Vineeta Agarwala, Jordi Hays
[01:32:59] S1: But that feels like more in the sweet spot. When I think about like an ERP system for for biotech companies, that feels a lot easier than saying, I'm going to take a cancer drug through the FDA trials and I'm never going to go public. I'm going to raise growth rounds at every stage. Like we haven't seen that much, but maybe we're still just early in that trend changing. [01:33:19] S7: Yeah. And I think part of that, the trend is changing in part because of the same trends we're seeing in other verticals that AI is getting paid for through labor budgets, and AI is not necessarily replacing but augmenting labor. Right? Ninety percent, ninety plus percent of all chemical screens for new drugs fail. No drug comes out of it. Ten percent of all nurse positions across the health care system are vacant. We can't find the nurses to fill the positions. Right? So we're living in a world where actually we need agentic resources to come in as labor, and that is different than the world we were living in before where we were trying to squeeze out IT budget from, you know, let's say, a large pharma company or, let's say, a hospital system to deploy the types of Silicon Valley technologies that could have been transformative for the industries. And so now that there's a lot more, you know, autonomous task completion [01:34:14] S0: Sure.