Special Episode: Jason Calacanis

0:00 Let me just make a little add here. Yeah, please. Hi, this is Jason Calicanus for acquired Is that the domain name? Listen. You're listening to this. You're either a founder An aspiring founder.

0:12 An investor or an aspiring investor. For one hundred dollars a year. You're gonna get hours of content that's not available to everybody else. That's also known as an edge. you are in a competition with other investors, you're in a competition with other founders.

0:27 You need an edge. If I could tell you you get one, two, three good insights a year. Even one. Would you pay a hundred dollars for an amazing insight that gave you an edge against your competitors? Of course you would. You'd pay ten thousand dollars. So why wouldn't you pay a hundred?

0:41 Because it's content. You're thinking about it the wrong way. The LP program at acquire dot fm is not It's not content. It's an edge.

0:50 And it's an underpriced edge. So buy for a hundred now. Before they raise the price to what it should be. which is five thousand a year. This is Jason Cal Cash for Require dot F M C U. In the slack. How's that for banana, huh?

1:03 You can have that. You can literally have my end. I swear we did not ask him to do that everyone. No, I just love I love doing it. Ha ha Welcome to this special episode of Acquired, the podcast about great technology companies and the stories behind them. I'm Ben Gilbert. I'm David Rosenpol. And we are your hosts. Acquired is all about stories.

1:38 Ordinarily. We tell the story of a great technology company or a great leader or a great adaptation. Today We are telling the story of someone who doesn't just have one story. He has a whole anthology across all of those categories.

1:51 The one and only Jason Calicanus. Uh so just to give Our audience. a small sampling of all of the enterprises that Jason has started and is involved with. Across his career. Yeah, David, I bet you can't uh do this all in one breath. Uh no. No. Jason has founded

2:08 Four companies. By our account. Uh Silicon Valley Reporter, weblogs Mahalo, and Inside.com. Do we miss any? No, those are them. Those are the four. And inside.com is the same captable, it's just a pivot of Mahalo, so arguably one.

2:22 We'll get into that. Three conferences. Three podcasts, Angel, All In, and of course this week in Startups, which is now over a thousand episodes. The YouTube channel around all of those. You were the first Sequoia Scout. You were literally the prototype of the Sequoia Scout. Correct. And the and still the greatest returner?

2:41 And still the greatest returner. But who's counting? It's not a competition. Anyway, we'll get into that. I mean you've made over two hundred angel investments in your career. You are a blogger, you're an author. You have a newsletter. You start at the launch accelerator.

2:58 The venture fund around that. Syndicate around that. You are the self professed we have you on record as saying you are the either third or fourth Best angel investor of all time. For sure, yeah. For sure I'm out Rushmore. Chris Saka, Ron Conway obviously ahead of me, and then there's a bunch of people we nobody knows who did incredible angel investments.

3:18 You know, in Google and Apple, but they don't have like um The n they don't feel the necessity to put it on the cover of a book like I did. Speaking of the Quote That we wanna wrap this up.

3:29 with from your book. Most folks think I'm lucky, some say I'm a complete fraud, and a handful think I'm a brilliant hype man. I don't agree with any of them. I agree with all of them. Welcome to the show. Uh big fan of the show. Thanks for having me on. And and David, thank you for doing that intro because Your voice is So much better than Ben's. I mean, that is a radio voice you have, David. I it's so soothing. And Ben and I are just like

3:55 Scratchy records. But Ben's got good insight. So I'm glad to be here. I'm a big fan of your podcast. Gotta have something to rely on, Jason. Exactly the insights. So okay, today probably most people Listen to subscribe to Jason on one of these many channels we've talked about. Today we're going to talk about two sort of less discussed parts of Jason's story. One

4:15 on the main show here is how Jason has built his whole empire across all these properties. and how it all ties together, uh, in his mind. And then two, right after this on the LP show. We're gonna talk about what the bigger picture is behind said empire. What Jason's secret master plan is

4:36 Allah his friend Elon. And why it might represent a wholesale deconstruction of the entire startup ecosystem. So you can click the link in the show notes or go to glow.fm slash acquired. I'm a member. I pay a hundred bucks a year or something. Well thank you. We appreciate it. Appreciate it. It's worth it. The L P show is like the best parts. Like you cut the nice like

4:57 The ribeye and that's like the best part. It's like the New York strip of the podcast. It's great. We hope that the whole podcast is good, but we uh the L B stuff is the tightest, I have to say. You guys put the most work into that and people just pay for it. You want good content to exist, pay for it. If only all of our guests were like you, Jason. All right listeners.

5:17 Now is a great time to talk about a new partner of ours here on Acquired, Lagora. The agentic operating system that is redefining how the world's best legal teams work. Yep. It's sort of obvious that AI is gonna completely change the legal industry. I bet most of you listening have dropped a contract into some sort of AI chatbot out there. Ligora took that insight and asked the question, what if you really built something with that power from the ground up for the legal industry? So the founders did exactly what great founders do. operate with obsessive customer focus.

5:51 They embedded inside a massive law firm. For months. They sat with the lawyers just watching how the work really gets done. And that's how you get features that customers love, like tabular review, where you drop in a folder of hundreds of contracts and it pulls every key term into a grid a lawyer can actually work with. Lagora's Bet Here is interesting. Since it lets each lawyer handle more complexity, any given person can increase the quality of their work. and do higher value work. And this means that the pie can grow even as each individual task takes less time.

6:23 And they recently launched Lagora Agent, offering greater intelligence and performance. The agent lets lawyers set an objective. Then it can handle the planning and the execution and deliver of the final product. Legal teams get to maintain full control and transparency since they're still involved where judgment is required. And Lagora works where you already work. You can use it within Microsoft Word while redlining or drafting. The early Lagora numbers essentially speak for themselves. When they have a head to head pilot with their top competitor, they win seventy percent of the time. Lagora now has over a hundred thousand lawyers on the platform from twelve hundred legal teams in fifty countries. And crazily they went from one million to a hundred million in ARR.

7:10 In about. Eighteen months. Th truly insane numbers. And that is the real test. Plenty of things demo well, but the question is whether a busy associate actually reach for it during crunch time, or whether a partner trusts it before going into a conversation with a major client.

7:25 If your legal team wants to check it out, whether you're a law firm or you're in house at a company, you can learn more at Lagora.com slash acquired. And just tell'em that Ben and David sent you. So Jason. You've talked a lot about Growing up, your childhood.

7:42 So we'll Do that briefly here. You're born in New York, right? Uh Brooklyn. Brooklyn.

7:50 You don't say New York. You you say Not only do you say the borrow, you say the part of the borrow. So I'm from Bay Ridge. Which is literally the last stop on the train on the train. Love it. Tell us a little bit about your family and what growing up was like for you.

8:05 Yeah, I grew up in the seventies and eighties. uh which was a fantastically interesting time to grow up as a young person. We were free range kids to the extreme. Uh in Brooklyn and You know, was not f hipsters back then. It was

8:19 you know, working class and Connected guys and the Hell's Angels and Cops and Bookies and it was it was a little bit more rough and tumble. My dad owned a bar.

8:31 He was essentially the mayor of Bay Ridge in a way, like people loved my dad, John the Beard. And they loved his bar. And they worked. At his bar, my brother my two brothers and I, my older brother, my younger brother Jamie and Josh From a very young age, my mom was a nurse and she ran the emergency room in Brooklyn.

8:49 at Victory Memorial Hospital and then later ran the ICU. She's a nurse practitioner. And she's got I think three graduate degrees, so I had this amazing hard working mother doing three or four jobs, had this amazingly hard working dad And it was a blue collar lifestyle. We're you know, we owned our house, but barely. Um we were always living month to month.

9:08 But there's a lot of love and a lot of craziness, uh, growing up in a bar. I literally grew up in a bar. And made espresso for mob bosses. Made baked clams for Tony Bannett.

9:20 uh would go get cigarettes for the coke dealer Would put it. Bellies in cappuccinos for police officers in uniform coming in at two or three o'clock to have a steak or burger.

9:34 'Cause my dad would let them come in at any time. Sounds like not just a bar. This is more like a pub. It was a pub, exactly. It was kinda like a pub. Uh and The cops would come in. Anytime they want it, but usually they come in between lunch and dinner. And uh my instructions were just give'em whatever they want and just charge'em ten bucks each.

9:53 And they would proceed to drink four or five Irish coffees. each Did they order them as iris coffee? Yeah, no, there was the wink and then it was the wink. You know, they they they we were in uniform, so they just wanted to have a cup of coffee. Hey, kid, get me a cup of coffee. Yeah, whenever I got the bookie Artie Moresca, uh or the uh the guy who dealt

10:13 Uh cocaine uh Yeah. pack of cigarettes or whatever, they would just say, Here's twenty Or here's a fifty sometimes, or sometimes even a hundred. Go give me a pack, give me two packs of Marboro lights. I go out and get two packs of Marlbites. It was two two dollars or a dollar fifty a pack, and they say keep the change. This is like the Brooklyn version of uh Bob Iger's story with um with the chairman Frank Sinatra going out and getting him mouthwashed. Exactly, exactly. And uh so you know, I I basically got exposed to commerce at a very young age and I became very interested in power and money.

10:43 Perhaps too interested in it. My first real job was a guy owed my dad Like two grand he had lost playing backgammon to him. My dad used to have a backgammon in a poker game at when the bar closed at four

10:57 the fun began from four till seven or eight in the morning they had after hours. Which was mainly cops and hell's angels and mafia guys and Yeah. Yeah, yeah, yeah. And I would come and I would do the porter work at seven AM. So I would come and sweep up the place on Saturday and Sundays when I was ten, eleven years old. With my grandfather, rest in peace. And we were the porters, fancy way of saying janitors, and um my dad would be there playing cards or whatever. Anyway, this guy got

11:21 He was in for two grand. And uh he couldn't pay. And he needed a little time, so my dad was like, That's fine. He said here g I know the kid likes

11:31 The Star Wars, here's the Empire Strikes Back. And Empire Strikes Back was in the theaters. And he handed my dad a VHS tape and my dad had gotten a VHS player that had fallen off a truck. This is before Blockbuster, obviously. This is like nineteen eighty four or something. I don't know, eighty five. No, eighty three, eighty four, something like that. They were just starting to have video rental source, but something like Star Wars would never be allowed. There would maybe come five years later. Anyway, long story short. I was like, this is incredible. I have Empire Strikes Back.

11:57 And I had my friend bring his VHS over and I make copies of it. And my first job was Jason's hot tapes. I would make copies of The Empire Strikes Back and sell'em for twenty bucks. That's too bad I thought you were gonna say you started run screenings. No, that would be a better idea, actually. But anyway. This is before Jason learned about marginal costs.

12:15 Exactly. I was like, Wait a second, how much does a VHS tape cost? My math teacher Uh says a Calcanus. Stay after. Oh my god, God, I'm gonna get pinched. And so

12:27 He says, Uh I know you're selling this uh tape. I said yeah. 'Y you think that's an okay thing to do? And it's like No, I probably shouldn't be doing anything. Do you have these tapes with you? And I said.

12:39 Yeah. He goes, How much are they? I said they're twenty bucks. He said uh Okay, I'll take one. And I said, Here, it's on the house.

12:52 When I say my life w I was watching Good Fellows I was using this um Chrome extension called Cener that we invested in to watch Uh good fellows. With some fans of the show, and I just tweeted and like group viewing, you know, like there's Netflix party and this is scenery. So now that everybody's home, you can watch Netflix with your family or whatever. So I put on Goodfellas and

13:11 I was just watching this kid growing up and I was just having flashbacks. I mean, literally my life was like The first act of Good Fellows. Well, Jason, I'm gonna deviate from our little outline here a little bit, but like I know you're a prolific poker player. Like uh I don't know if semi pro is the right word, but you play with pros, your friends with pros. Um a lot of your investing patterns sort of match Poker patterns. Informed by yep. Yeah, so w did that start here? I didn't I was exposed to gambling at a very young age. I didn't participate in it. My exposure to poker came when I was in New York a friend of mine, a deo Ressie, who started the Founders Institute, just started a twenty thirty dollar poker game.

13:49 And myself, Scott Heiferman from meetup dot com. Uh, Nick Denton had come to a couple of games. Uh, Jeff Dodges from Razorfish and now OneDrop, which I'm an investor in. Just a bunch of like the Silicon Alley folks would play cards and I'd play cards with them and Nobody was like one of those card games where people said

14:05 What Better, a straight or a flush. And you somebody had to like look it up kind of thing. Yeah, you have the little card next to you on the table where you're sort of referencing it. Yeah, literally that was like that. It was just an excuse. And we used to play down in a place called Forlini's, which is still down in Chinatown, which is like um an Italian restaurant. I'll leave it at that. And we used to play in the back.

14:23 But then I went when I moved to LA and I spent a decade in LA, a lot of my friends like Sky Dayton Uh was playing cards. And uh my friend Kevin Pollock who was friends with the actor, he was playing cards and we just you know Those games were

14:37 two hundred dollar buy in or five hundred dollar buy in, so you had to be a little more serious about it. And then I you know, the stakes started going up. I tried to study the game, I was terrible at it. And then I started getting invited to this game. woman Molly kept inviting me and she'd be like, Oh, Toby really wants you to come to the four seasons and Uh Leo really wants to see you and I was like Toby and Leo wanna see me lose

14:57 twenty grand. Like wanna see Jason Galgata. Uh so I never went to Molly's game, but she invited me frequently'cause I was a fish for a whale. As we say in the business. But yeah, it it that's when I got exposed to it and then One of the in the early D conferences Uh, myself, Bill Gurley, Mark Pincus.

15:14 And um Sky Dayton, we're all there and we say, Hey you guys want to play cards and we went up to I think it was P Mark Pinkis' room when we just took the folding table, we started playing cards, and then we started hosting this game at the D Conference, which later became Recode. It became very famous as poker game and then we have a weekly poker game that everybody knows about here in Silicon Valley. Yeah, it's just my best friends and

15:37 Phil Helmuth and Draymond from the Warriors, um Shamath, obviously, and David Sachs. Um just a really good group of guys uh who get together. And uh we've been playing virtually now, which is kinda fun. And now you have a podcast around it. Well, Chemoth was just like Chamath was one of these guests on my podcast who

15:56 He just burned the building down and he nobody really knew who Chaboth was until he came on my podcast and Um, you know, we started having him at the events and then CNBC got their hooks into him and now he's just like throwing bombs for a living. Well I'm sure he gets like just incredible page views whenever he goes on C N B C and Traffic. It's just a problem for me, though, because he's like let me come on your podcast and just say everybody's a fraud In venture capital. I'm like, I I know you made your money and you're retired and running a family office now, Chamoth, but I I'm raising funds right now. Doesn't really help me to have you on the podcast saying that this is a giant Ponzi scheme.

16:33 And he's like literally pouring gasoline over himself, lighting himself on fire, and I got like step six feet back. The media business. Yeah. So when so you go to Fordham. Yeah. After Port was it right after Portham?

16:51 At night you start as a at night, you start as a reporter. How well so what draws you into the media business?'Cause to my mind this is the this is the b well, obviously you're growing up years and everything, you know, that shaped you then. But starting in the media business is the wedge that brings us all to the Callicanus Empire now. Yeah. So this is a very interesting thing. What happened was, you know, I I would go into Manhattan. I was just in awe of the people in Manhattan. And

17:17 People who were rich. Or famous. And who are powerful. 'Cause I had no power growing up. And I was in a very dangerous situation and I was watching people who were powerful and I was like, Okay

17:30 The book is very powerful. The head of the hell's angels is very powerful. This cop is very powerful. I am not powerful. My dad is powerful. He's got all these people in his bar like And I was watching money go around and I was just fascinated by these topics. Probably too much. And

17:45 I saw magazines. And magazines are how information was really transferred in the you know, eighties and nineties. And so I just started subscribing to every possible magazine. In the eighties, I got all the PC magazines and bytes and all that kind of stuff. And then I started, you know, this Esquire, this paper magazine, Timeout New York.

18:05 So you were kind of a geekkeeper back then. Like you it wasn't just that you were like, you know reading Esquire or like the source or whatever, like you were You're reading the tech plugs. I was reading all the tech stuff and I I was really into technology. I had a PC Junior uh computer that my dad had bought me with cash from the restaurant or Parker game. I was doing a little phone freaking, which is like getting phone codes. Anyway I was involved in a bunch of scams. Yeah.

18:27 Well, the the phone freaking thing was kinda scary because Yeah. The way s sprint worked in the early days is you just dialed an eight hundred number and then it asked you to put in like a five or six digit number, and then you either got a dial tone or it went mm mm mm mm mm. Doesn't take a genius to figure out if you put up a war dialer, which is just a random dialer on your modem that dialed all these different random numbers, in the morning you'd have two or three codes. So then you start using somebody's code until it got turned off. And so we were doing all kinds of scams and stealing floppy disk and selling chess master. Anyway, I got out of all that.

18:57 And I just went into IT. And so I worked in the computer lab at Fordham. I was making two fifty an hour, which was the minimum wage in nineteen eighty seven, I think. Then it went to three fifty, then I got fired from that. job because I had partitioned a hard drive. And created a hidden hard drive where I put a bunch of video games and I was selling

19:13 So you're entrepreneurial. Yeah. I was a criminal. Um I was selling word perfect out of the Fordham computer lab and I got busted. And I then I started selling S P S X or whatever that's called, like the ten disc. like four hundred dollar statistics package. And it's this is like

19:33 Yeah, this is like a really bad idea'cause now I'm seventeen, eighteen. You can't do it. It's starting to get worse than Star Wars tapes. It's a little bit worse than the Star Wars. So I stopped all that and I realized I could just make six or seven bucks an hour. Then I went to work for Amnesty International. I started making ten, twelve bucks an hour doing IT. And I T just opened my eyes to like whoa. And I saw the internet early, I saw modems early. And it really opened my eyes. And then I thought maybe I'll write a book or whatever and then I was watching this the zine movement ha happened, Z I N E and so zines meant you published

20:02 On photo copy paper. And you called it a magazine and in Tower Records they had a section for zines. And I used to go there and look at these crazy zines and twenty six hundred was one of them. Twenty six hundred, they would just self print it, self publish it. And it was just hacking stuff, right? Is that named after like twenty six hundred Bod?

20:19 Yeah, Hertz. Yeah. I think it was Hertz, which is I think the when when Captain Crunch made the whistle, that would then give you dial tone. I think it was the twenty six hundred hertz. We can look it up online while we're here. But anyway, they used to always meet in Manhattan in the city the City Bank building in the lobby where the phones were. And there was a sort of culture in New York of hacking And media at the same time.

20:39 And I started a magazine called Cyber Surfer about dial up because somebody had told me that Starlog And Fangora, that magazine w wanted to create a a magazine about CD ROMs and dial up. So I started Cyber Surfer magazine, which nobody knows about.

20:54 And I got in a fight with the publisher after five issues. He sued me because I had trademarked the name. He didn't know I trademarked the name, had no contract with him, was twenty three years old. Whole thing blew up. Um, and then I was like the Silicon Valley thing's gonna become something. So I started Silicon Valley reporter as a sixteen page photocopy. And Fred Wilson bought the first ad in it. Along with Jeff Dodges. No way.

21:14 For he bought an ad for Flatiron? Uh for Flatiron Partners, two hundred fifty dollars and he uh he bought four ads at once, so he gave me a thousand dollars. Wow, advertising like their services as a logo of Flatiron Partners. Uh, and this is nineteen ninety five. I got two people to give me a thousand dollars. I printed it up, it cost two thousand dollars. And I just started handing it out at parties and I I didn't understand how silly I looked, walking around town With a luggage cart.

21:41 Like I was like a street salesman with a stack of photocopies and I would drop them off at everybody's offices'cause once I got like a thousand copies of this I didn't have the money to ship it anywhere. So I would go to Razorfish's office, I would go to site specific I would go to iVillage, I would go to all these places and ask them if I could put twenty copies in the reception area and they'd say sure. So you're going to these early internet companies dropping it off. And they would say, Oh, you're dropping off your and I'd say, Yeah, I'm the delivery boy. And they'd say, Oh, that's very cool. I said I'm also the editor.

22:09 And there was a joke in the magazine I put uh CEO, editor, and delivery boy. uh on the top.'Cause and What it was was it was like quite charming to people. that I believed in it so much that I would carry it with me. And then people also thought I was like This is why I when people say like they think I'm a huckster or a hype man or a fraud.

22:27 People thought that back then because I would go to parties with a stack of them in my hands. And I'd be handing them out to anybody who would take them. Uh, because I just want it to be famous. I just want it to be powerful. I just wanted people to know my name. It's so interesting because it's so akin to the early days of blogging. I mean it it's just analog blogging where the I'm sure any real publisher was looking at this like oh it's some kind of joke. I can't believe you're calling yourself a zine like it's not a magazine. You know, this is like photocopy paper. And I said to them, No, I have a full page photo on the cover. That's what makes it a magazine.

22:59 And they said, No, it's a newsletter. I said, No newsletters have text on the cover of the magazine. This is a full page photo and then a guy named Carole Martesco Emailed me. But you still have the email in there. Um and he said, Hey, I do this magazine.

23:12 uh called Rez and I do this filmmaker magazine. He was doing filmmaker magazine, et cetera, and he knew how to do magazines and he was like ten years older than me. And he said, I can print this on real magazine paper for you. I said, how much do it cost? He said it's gonna cost thirty thousand dollars. And I said, Well, I have like twenty thousand in ads now. This is by the fifth issue. And uh he said, Don't worry about it, I can put it on my credit, I know the person, and he printed it for me. Just f for free, just to do it for me. And then he's like

23:37 Do you have the money, you have to pay the printer? And I was like, Yeah, I gotta collect the money from the advertisers. So then I went around and just asked people to give me the money and I would bring them two or three grand. Thank you, Carol Marchesco shout out. I was still friends to this day. And he basically mentored me how to do that and then At a certain point. My assistant Linda Miller said

23:54 John Winter called. And I said Oh, okay. He said, Yeah, you know, from Rolling Stone and I was like, Yeah, it's like year two of the magazine. I was like, Okay, great And then I went to lunch and then she came back, Did you call Jan Winterback? And I was like, No and I was like, I'll t I'll call tomorrow. I cut back the next day and she goes, D Did you call Jan Winterbach? And I said

24:12 I I don't want to do any press right now. And she goes. No no he he's not a journalist. John Winner created Rolling Stone. I said

24:20 Oh. He wants to meet with you. And so I went up and I met with Jan Wener, and he had all my magazines on the on his table. And he said, Hey, I want you to come work for me and do a magazine with me. I want to do like a digital version of Rolling Stone. And I said, No, I want to do my own thing. I was up in his office and he had marketing. Jason wouldn't that have made you famous? Like why wouldn't you do that? I also realized I no, it realized that would be a number two.

24:41 And I never wanted to be number two. So it's about the fame and the power, or I might it was all the power. Fame, power, money, fame, power, money. That's all I wanted. I just wanted to have fame, power, and money, all of those things. And I just like number two, no And then all of a sudden I became the king of New York because the internet hit. Magazine went to seventy five full time people, twelve million dollars in revenue. I built it up my credit cards. I was on Charlie Rose, I was on the cover of the New York Times.

25:02 And in three, four years I went from being a nobody to writing for paper magazine and when I would walk into any club or whatever people knew what Silicon I reporter was and I could get into any party and then I made a list and ranked the top one hundred people in the industry and I ranked it. Just to tweak people. Um and then people would beg me to move up ten rankings and I got everything I wanted.

25:23 Power. The minus list is still doing that to this day. Yeah. And I did my first event in nineteen ninety five called Ready Set Pitch. And you can look it up in the New York Times. There's an article about it. Right, he said pitch, and it was Just I asked people to pitch their best idea for a

25:37 Uh a startup. And Teddy Autos gave the keynote, so it's pretty funny. As as you get in all this. This power. What's going through your mind? Like are you

25:46 Are you already starting to think about more? Are you thinking about I parlay this into investing or I parla extra like what's I want it to be the next media mogul. I want it to be Eisner. I want it to be Like I wanted to be Ovitz. Ovet. I wanted to be somebody like that. 'Cause media was the power back then. It wasn't really about the tech companies. The tech companies were kinda like

26:10 This is my warner days. This is Yeah. You know, like that's what I want it to be. I want it to be one of those media executives and be the CEO of a giant media company. Barry Diller, someone like that. So you end up selling Silicon Valley reporter to Dow Johns, right? Yeah, it kinda collapsed and we wound up selling I got two years of salary, but the year before Alan Macliff from Internet.com had offered me twenty million dollars for it. And I own like eighty five percent, ninety percent of the company, so It was like the

26:37 w one of the most difficult times of my life because I had my chance to be rich and then I was poor again. Was it The dot com crash the Yeah, the dot com crash and then nine eleven and I was there for nine eleven, my brother's a firefighter. We didn't know where he was. That was his second fire he ever returned to, so it was a very scary day for me. You know, after nine eleven I was kinda left with this

26:57 Oh everything. is a fraud. Everybody thinks I'm a fraud. Everybody thinks I got lucky. You had all this power. And it was gone. It was gone. Did it disappear? Did it really disappear? Well, you know, it really was trying for me because everything I had done had gone up and to the right and everything I touched turned to gold. And then when you have the Midas touch and then you start touching stuff and Nothing changes.

27:21 It really is humbling. It's literally like you you go from feeling like you're superman And then you can't fly. And you're like, what's going on? Is there kryptonite in my shoes or something? And it was a very humbling experience for me and it made me really angry. I remember vividly. I just felt very angry.

27:37 At the world. And at myself for not taking that twenty million. So it wasn't just angry about what was happening, it was like you were specifically like angry about passing on that. I was angry at passing on that. I was angry that the market collapsed. I was angry about nine eleven. It was just angry about everything. Um, but I also had skills at that point and confidence. And so I said to myself, I am coming back and I'm gonna come back and dunk on everybody. And I will show everybody

28:01 that not only am I not a fraud, that I can do this again and I can do it quicker, faster, and better. And I started looking for an idea. And I was studying and studying and studying and Two people who worked for me after the whole thing collapsed had moved on and started blogs. And they were doing really well with their blogs. And

28:19 Uh one of them was for Rafad Ali. Uh who's doing who was doing this paid content.org and I had admonished him'cause he started it when he was working for me. I was like, listen, kid I didn't realize Rafab worked for you. Yeah, he was one of my writers. So I I think I was his second job. He had he had worked for inside.com and then for me. And he had owned the inside.com domain at one point. So there's a whole sort of history there of who got to own inside.com.

28:40 At the end of the day. I can tell that story too at the end, but uh anyway. I was like And then Shiny Jardin went to work at Boing Boing, and I found out they were both making like four or five grand. And I was like, wait a second, that's like kinda what I that's more than I think that's more than what I was paying you. Per month. Per month.

28:56 Just on ads on their blogs. Exactly. So I was like, Wait a second, these people are working in their underwear They have no added or and it dawned on me. The right writer and editor is

29:09 uh hindrance. They're taking out what's special about what the person said. This is like taking out the production. It's like Bob Dylan just on stage with a guitar. It's better.

29:21 When it's not produced. It's better when it's acoustic. And there was that thing that was going on, um MTV had unplugged. And I said, This is MTV unplugged for journalism.

29:33 Blogs. It just clicked in my mind. Clear as day. When you saw Kurt Cobain on MTV Unplugged. You want to throw the other records away that were studio produced.

29:44 And I said, blogging is gonna be a thing. So I started looking for other blogs and this I knew this kid, Nick Denton, who started First Tuesday. And he started Gawker. I said, Hey Nick, you know, wanna have lunch? We went for lunch. I said, I'm thinking about doing a blogging thing. I think this could be big. If somebody did it for business. Would be huge.

30:01 You're doing this gawk or gossip thing, I'm not interested in that. But if somebody did a business version, and then he wrote a blog post and he said the worst thing that could ever happen to blogging is Jason Calicanus bringing His unique brand of like whatever to it. Corporate sellouts. Well that's what he said,'cause I was like, you know, this would be an advertising juggernaut. 'Cause think about it, you get rid of all of the You get rid of like eighty percent of the staff

30:21 You just have the one great writer and one great salesperson. Did VallyWag exist at this time yet? No, no. Vallywag he created much later. It was just Gawker. I mean like I I worked at the Wall Street Journal, you did too for a while. Like they're you know, it's a wonderful organization. There are a thousand people in that building. Yeah, it's crazy. That to No You don't need a building. Yeah. Yeah. You don't need middle management. I mean you don't need anything. So

30:44 I was really taken by, you know, Denton's vision for this. And I was like, Are you gonna do more? And he's like, Yeah, we're doing this we're gonna do a political one, I think, and we're gonna do this one on gadgets. Like you know, like the uh fetish thing in Wired magazine, we're gonna just make that into a whole thing. I got the and I was like, Oh that's interesting. So He writes his blog post trashing me.

31:04 You And so, you know, like I'm a pretty aggressive guy. And I was like so I my partner Brian Alvey, who I convinced to do this with me. This is two thousand three. The none of us had any money. We're doing it all for free. The the economy was Flatlined. I said

31:20 I'm gonna Destroy. Which it turns out you were not the last person to have that thing. No, no, no, I was not the I was not the first I was the might have been the first, but not the last. I said, I have to destroy Nick Denton. Um How am I gonna do this? And I said, um

31:35 Oh I know. Talent. There's nothing worse than losing talent. Elizabeth Spears She's right she's writing Cocker.

31:45 I'm gonna make a run at her. And I had heard that he was paying the riders fifteen hundred dollars. And the MacBook Air had just come out. I contacted Elizabeth and I said, Let's have coffee, whatever and she agreed to have coffee or something. Yeah. And there's like a photo of it actually of me talking to her at a bar that somebody took in the early days and she's looking at me like I am the antichrist. And I was like, You are a unique talent.

32:06 Nick Denton will never give you equity. I will give you equity. You will become a millionaire. I'll give you a MacBook Air and I'll give you two grand a month, which is a thirty three percent more raise. She was like, Yeah, no, I'm gonna go work for New York magazine. And I was like, That's the worst career movie you could ever make, Elizabeth. Magazines are gonna die, blogs are gonna take over. There's no way b magazines can ever keep up with blogs.

32:25 Whatever they print is gonna be old news. And you're already proving it. You you're number one at blogging. And you're gonna become number five hundred at a magazine. So she wouldn't do it.

32:35 Um, and then Sheni Jardin said to me, Oh, you picked the wrong target. I was talking to her because I was trying to recruit her. And she's like, No, no, I love this boing boing thing. I don't want to do anything commercial. I was like, All right, that's fair enough. I was like, W who should I target? She goes, Oh, you you picked the wrong target. I said, What do you mean? She goes, Oh Nick's not making any money on Gawker. Gawker doesn't make any money, loses money. I was like, Okay, tell me more. She goes.

32:54 A hundred percent of the revenue's coming from Gizmota. I said, Oh, okay. He goes, Do you know Peter Rojas? I was like, Yeah, I've heard of him. That's the one you want. So I went to Peter Rojas. And I uh

33:06 Called uh This guy I knew was running Jewel Baku, which was like a fancy sushi place on the Lower East Side. And uh he was the owner and his wife, and it's like a pretty hot ticket. And uh I asked Peter to come have sushi with me. And his wife Joe, or his girlfriend at the time, she says, Can I bring my girlfriend? I said, Of course.

33:24 We go there. And uh I'm prepared to like knock their socks off with this omokase. And I said you guys have anything, you know Terms of like Die and like we're we're vegans.

33:34 I said, okay, yeah, that's no no problem. I said, give me one second. I go back to the guy and said, listen, this is I'm trying to close this deal. It's like this is really important. Like they're vegans. He's like, Don't worry about it, be right back. He runs to the Korean grocery on the store. He comes back with two big shopping bags full of things, and he makes them the most amazing omakase with vegetables. Yeah. And so I said to Peter. I said, Peter, you know Um

33:57 Nick Denton is a bad actor. And equity is what you need. And if you join me. And you create A Gizmodo killer.

34:06 I'll give you equity in the company. And uh you will become a millionaire. And Uh, we'll be in it together. You'll be a partner. And he goes, Well, Nick said he's gonna give me equity. I said, He'll never give you equity. When did he tell you that? He said he told me that like six months ago. I was like, Yeah, how's that going? I said, I will give you equity on day one, fully vested, everything.

34:23 Uh, just like me. And he said, uh Okay. Let me think about it. And he came back and he said, Okay, I'll do it. I said, Great. Um he said but you know,'cause by the way At this point in time, this is

34:34 I'm probably seventeen, eighteen, nineteen years old at this point. I'm reading Gizmoto every single day. And I always wanted to know What happened? How did Engadget become better? I never knew. Yeah. This is the story. And uh he says Oh my d my girlfriend Joe made a logo. And Joe made the first thing gadget logo. I was like, Great. He's like, Can we pay her for it? I was like, Sure we can. I was like, what does she charge for a logo and he's like three hundred. I was like, Give her five hundred, it's fine. Because Mark Cuban had given me three hundred thousand dollars.

35:02 For fifteen percent of Weblogs Inc. How'd you get to know Mark? I had no mark'cause I had written broadcast.com is a billion dollars worth of hot air and Silicon Eye Reporter and he Mm. And I said, Well, you your revenue is like ten million. He's like, Do you know what the revenue is next quarter? I was like, No, you're a publicly traded company, of course I don't. And he's like, Well, why don't you wait? And then revenue went from ten to like sixty, you know, like quarter over quarter. And I was like, Okay, it's not a billion dollars in hot air. And I did a Mia Copa kind of situation. Anyway, became good friends, Mark and I, for a long time. And he put three hundred K in.

35:32 We started blog Maverick for him. Um, Brian Alvey came up with the name. Brian Brian Alvey came up with all the good names, the best collaborator I've ever had in my life. And uh and Peter. And uh so Peter said, Listen, you know, I just I feel really bad about this stuff with Nick Denton. I was like, You shouldn't feel bad. This guy promised you equity and he gave you nothing and you've given him this incredible brand, that's gonna become worth millions of dollars. You should feel zero guilt. He he robbed you of your vision and we're gonna take it back. And he's like, Yeah, yeah, you're maybe you're right. And I was like, Yeah,'cause I

36:01 I've been in fights. And you know, if somebody takes a swing at you, like somebody gets a su if somebody sucker punches you Uh you have to teach him a lesson. Um so they don't do it again. 'Cause if you don't teach them a lesson, what I learned is they will come back.

36:17 It has to be such a A beatdown. It has to be so painful that the person says, I should have never punch that I should never sucker punch that guy. That's how powerful the beatdown has to be.

36:30 It can't just be retribution of one for one. If they punch you, you have to annihilate them. This is what I learned about violence when I was growing up, and I've since disavowed this, but this is literally what I saw on the streets of Brooklyn in the seventies and eighties. So

36:46 I said uh When are you gonna tell Nick? And he said, Well, he's you know, he's been working so hard for like a year and a half or whatever, and he's just burnt out. He's been working seven days a week on this, and he said he's gonna take his first vacation. I said, Oh really? He said, Yeah, yeah, and he's going down to Brazil or whatever and All these famous people are going. I said, When is he going? He's like, It's going Sunday. I was like, Oh, wha what time is he leaving?

37:05 I don't know what time he's leaving. I said okay. Oh looked up online, like flights to Brazil or whatever. I c couldn't kinda figure it out. And I was like, All right well listen, I want you to write a blog post about this. We're launching the site at two PM On Sunday. And we literally launched the site the first day of his vacation. He landed with his people going, Gizmodo has no blogger.

37:24 We have all these advertisers and there's a competitor. Oh my god. And that was the approach I used to take to competition. I don't do that anymore, but Well, by the way, in the in the post script to that is Dent and I became very good friends after that for a long time and still are. And I consider him One of the just the great publishers. So how how do you become friends with the people who are

37:46 He reached out afterwards. He wrote a blog post actually saying, you know, Jason really stuck it to me. But we're we're gonna be great competitors. And then I launched Joystick and then he launched Um Kotaku, then I launched Autoblog, then he launched Jalopnik.

38:01 And when we were head to head, we always had three, four, or five times the traffic as him but it created this rivalry that everybody followed. It became Coke Pepsi, it became You know, yeah. Pick media company versus media company. And and everybody was following this great competition between this brash Brooklyn kid and this aloof, you know, quiet. Oh, it made it's incredibly both better, but you're you know, it was like literally this like Quietly gay. You know, very understated Brit versus this brash Brooklyn Bulldog. And it just played really well in the pricing. You can

38:32 If you type Denton Callachanis into Google and look at some of the posts from back then, it's hilarious. And it was just a good time. Um, but he reached out to me and he said, Listen, um I think we should have a um yeah, Jason, um Respect, uh respect for what you did there. I understand. Um You know, and Peter Best of luck with Peter and uh we know we went for half coffee or whatever, and we're sitting there and he said, Um, I have a proposal for you. And I said yes, he goes.

38:56 think that um you know if we're gonna have this spirited com competition that's great. Well you know Good for the game and all that. Uh you'll you're a worthy competitor and obviously you've been able to knife to come out. Well, yeah, and I'm just like okay, this could escalate. Yeah. And he said, um I'm proposing a no poach um agreement. And I said, What does he mean? He goes, Well just, you know, there's no need for there's so many writers out there. We're we're it we're not enemies. What we're fighting against is the magazines and the newspapers. You know, we're we're up against the New York Times and That's enough competition for us. And I and I said, you know, that that makes a lot of sense.

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41:24 Well, Jason, I gotta tell you, just a quick personal note, and this will surprise zero longtime listeners of the show, like I think the number one website that I checked every single day at high school was the unofficial Apple weblog. Uh to a wrong. Um There's an interesting story to that.

41:40 We called it the Apple weblog and um Steve got upset. No way. Yeah. And uh they we got a phone call. And I said, Okay. We actually had called it the unofficial Apple web blog and Apple called

41:54 Steve told his people to call. We had a pretty close relationship with Steve, or at least Peter did. And you know, Steve responded to our email. Well, yes. I mean Steve was the master. And I and I I I'd spoken to Steve in person two or three times and over email, you know, half dozen times during the ingadget time, Peter much more. He really loved Peter. And and Steve was really great. And uh Anyway, they had some sort of problem with it and they said you can't use Apple in the name. And I said okay. And I just said You know, it's back when you could buy domain names and I said the

42:25 Unofficial Apple weblog. I said let's make it an acronym. Twa And then just build a logo and and I think Jill Farenbacher, you know, uh Peter's now wife, uh mother of his kids. I think she built that one as well. Took the little leaf of the apple and just threw it above the toit and called it a day. Well that was kind of I think that was Brian Alvey's joke is like it sounds like it's French, so let's put it as like an accent de grave on top of it. And I was like, Sure, let's troll them. Um we do just like a lot of crazy stories like that. Um and uh long story short,

42:53 that company lasted eighteen months we got we sold it for thirty million dollars. Uh to A O L. And uh we have all of Weblogs Inc. This is all these things. All of Weblogs Inc. We had a hundred thousand dollars in revenue to date and probably two hundred thousand looking forward. So, depending on how you count that, they paid three

43:09 They played a big multiple. But the real question though is like looking back now, was that actually a good idea to sell? Of course, yeah. I mean if you That gave me the money to become dangerous.

43:20 And it gave me that foundation, you know, when you get that you know, the first ten million's the hardest. Um and once you get that under your about You're dangerous, nobody can stop you. I mean I was already dangerous because I didn't care. But once you get the cash

43:34 Then you really have the ability to not care. Right. So it's like I if you hadn't sold and that were still an independent company. I mean listen, here's the joke. Denton wound up selling I think for one hundred fifty or something like that. And then half of it went to Um, this new company that had put in the bridge financing and then some amount went to Hulk Hogan and Peter Tiel, and then some amount got left over. I think we wound up netting about the same.

43:58 It just took him twelve years and it took me eighteen months. Uh but you know you know they always You got to start writing your next chapter. Exactly. I I had what the the the great thing about Silicon Valley reporter crashing and burning was I learned very early on That I was more than the brand. 'Cause the brand stuck in our report had gotten so big and I was so identified with it. That I

44:20 Started People would call me the Silicon Valley reporter. That was like what people would refer to me as. Um and Because it crashed and burned, I was forced to disconnect myself from that. And I Bob Dylan was always my favorite artist. And I had always studied um and been obsessed with

44:38 How he went from like Folk. Electric and rock. Um Gospel and

44:46 This Yeah, he just kept reiterating and then he started collaborating with Mark Knopfler of Dio Straits and did Empire Bellesque and You know all these other really infidels and these very interesting albums. Um and I seen Bob Dylan maybe twenty times, um

45:01 you know, in person uh and he was you know, always my favorite and I was like Don't look back. And I just told myself, you cannot look back and I I never look at my press scope. The amount of press I got in the nineties. between being on Charlie Rose, being on Sixty Minutes, all that stuff. I knew that I was never gonna top that.

45:18 You know, like that was a moment in time. And I didn't want to top it. Who cares? Like I I put all that press in boxes, I taped it up and it's literally in my brother's garage in New York still. I don't want to ever look at those clips. Don't look back. Only forward.

45:31 Next brand, next brand, next brand. Don't worry about the last brand. Yeah, and that's how I looked at myself at that point. I w I looked at myself and I said, You know what Kurosawa. Did all those Samurai films and then he went into Noir and the Noir stuff was better. And nobody even knows about the noir.

45:49 You know, the film Noah stuff he did. High and low, Shrey Dog. You know this kind of stuff. Is it after then? The next chapter you get You get money.

45:58 You were back in the game after I'm in the game, baby. Is that when you move to LA? I had been living in LA. Um when we start uh right after we started weblogsing.

46:09 Yeah. And at this point, do you still wanna be famous? Like once you've adopted this mentality of don't look back, are you still fame driven? No, fame wasn't. I I really wanted to build things. I had gotten into the mode of building Um not necessarily empire. Silicon Valley types? I think it was. I think also when you get the wind under your belt. It takes the edge off, and I always tell that to young founders, like

46:35 You know, winning really takes the edge off. Um and you will be successful. It may take two or three companies. you know, if sixty, seventy percent of these things fail, don't worry about it. Just start three oh four, you're gonna have a hit. And nobody remembers. Like we're sitting here, when people meet me They they don't know what Mahalo is. They don't know what Silicon Air Porter is. They don't even know any of the stuff. Nobody has any sense of history. But people are all caught up in their own history.

46:56 I I for sure had a Mahalo account. Yeah. I mean Mahalo did really well. I mean that's a whole nother story, but yeah. Now that's another one, right? Where you just so you build a brand that becomes so big and You you kinda get associated with it and then you have a big flame out and It's like who cares?

47:13 Just move on. Next one. We'll get there, but I do want to talk about the Mahalo Pounce Twitter, that sort of uh uh tumbler. Like let's let me put a pin in that and David, keep running with your Your line here. Well okay, so this is this is a diversion, but we uh side track, but we gotta cover it. When you're in LA How do you meet Travis Kalanick?

47:33 Well I when I was doing Silicon Eye Reporter, we had started a um an edition called Digital Cost Reporter. And I had interviewed Travis when he was doing Scour, which was his first company. Oh wow, yeah. And uh sued and he got sued and all that stuff, and he told the famous story. And that was the night Allegedly.

47:51 when Michael Lovitz's people came and were in the audience at my event, I used to do a CEO interview and I interviewed him. So that was that famous story. And then he did Red Swition. We'd always been friends and we'd always liked each other. And that and that's how I wound up investing in Uber because he when he was raising money for it, he wasn't gonna be the CEO uh he was like, hey, I'm doing this company. It was like a you know, Ryan and him and And Ryan was CEO and Ryan was gonna be CEO and then I was going to invest a little bit of money and I was helping Ryan raise money and then he said, You know what, I'm gonna be the CEO. I said what happened with Ryan and I was like, oh this is this is looking a little shaky or whatever. And then I just made it as the first scout bat and I introduced I think first round and definitely Cyan were at the open angel forum, the little event I used to start where I matched Angels and

48:33 So at this point you're you're running Mahalo at this point. So I actually didn't realize was Uber the very first scout investment? I think it was the third. I think I had I had In the first seven There were three unicorns. And this is a scout.

48:47 As a coy scout. I I had the first seven Uber, thumbtack, and data snacks. So three Companies.

48:55 Three unicorns. One of them public decorn. Um we'll see about the other two, but I I think the two got a chance to go in public too. And so our our listeners understand here, and we didn't list all the companies that the UV Angel invested in, but we're gonna keep touching on them as we go. Like so y when you're investing as a scout, that's not your own money. So how did the economics work on that? It was fifty fifty. So it's fifty fifty b basically splitting the carry, the the profits. Split the profits, yeah. Yeah, it's crazy.

49:22 They've since dropped it, I think, to thirty five or thirty, like a normally high carry. How did this happen though? Like what did you did you go to Rulof or did Rulof come here? Lobbied. She coy I had emailed Sequoia and lobby them to invest in my friend's poker game.

49:38 Um Zinga Poker. Zinga Poker Game. He my friend created a virtual poker game. Uh Mark Pinkus called Zinga. And our dogs have to never heard of it. And uh I invest I said, Hey, you should invest in this and they they couldn't get there. Um

49:54 But my but my other friend, Fred Wilson. You were a portfolio entrepreneur. I was a portfolio company and I said, Hey, you know, this Twitter thing's gonna be big. And the thing that thing's gonna be big. And I was pushing Rulov and I I have an email where I told Michael Moritz and You have to get the Twitter deal, you have to get the Zinga deals. These are very important companies. Um and then my friend Fred Wilson. What did they say?

50:15 They they I said they went the next day, actually, and tried to close Twitter, but they couldn't get their head around the valuations or whatever it was at the time. I'm not sure their exact objections. Both of those cases. Fred Wilson had invested and actually introduced me to Mark Pencus and Mark Pinkis and Evan Williams. And I were talking Sequoia or

50:32 Fred Wilson. And I was a Sequoia CEO and I said, Listen, when you are a Sequoia CEO, your phone rings off the hook Everybody wants to do your series B. I raised my series B from Mahalo before launching the product six months after I had raised my series A. And I went from an eleven million dollar valuation to a hundred million dollar valuation. Wow. And this is in two thousand six. Yeah, uh two thousand six, yeah. And m Mark Pincus and Evan were like

50:55 How did you go from eleven million to a hundred million before the product launched in six months? I was like, I don't know. And uh they were going for like thirty or forty million I think each. And uh they were further along and their products were launched. I said, listen, Fred Wilson's East Coast, he's awesome. He's like one of my best friends for a long time. He got me helped me get in business. His wife Joanne worked with me at Silicon Air Border as a sales person. And you know, but and and also Joanne Wilson, his wife, worked with me at Silicon Air Reporter and and the reason it was so successful is she was the salesperson and she was like I mean it was it was two bulldogs, like she's a tiger. And she's now a great

51:29 Angel investor herself. Absolutely, yes. And um And and just one of the great collaborators I've ever had in my career. And anyway, long story short, I said, listen, you're you know, you're picking between Fred, who's like the up and coming hustler Will work hard. And but you know, he's a he's East Coast.

51:44 And a lot of people, you know I You know, Fred thinks Sequoia is the gold standard. Fred would tell you to take Sequoia's money. But I think Fred is great too. So I I actually think it's a coin to us you can't lose. And they were both struggling to take the which who would take that deal.

52:00 I think that gave me the credibility. With Sequoia. Um that They said, Jason keeps sending us these great deals. There's many more companies now. Jason has this collaboration with Arrington for TechCrunch 50, and they broke up and now he's doing this launch festival on his own.

52:16 And Rulov came up with this idea, what if we raise like a three million two or three million dollar fund and we just gave everybody the ability to make twenty five, fifty K checks? And there was this issue of signalling in the industry back then. Where if Sequoia gave you money and you they didn't give you the next round, your company was dead. That was the end of your company. 'Cause you were then. Well, that works too. But you know, the idea is like you would if a if your venture fund did not

52:42 Follow on the You were damaged goods. Uh and nobody else would. And the higher profile the fund, the higher profile the signaling risk. So Sequoia was acutely aware of this, so they just said the Scots program we wouldn't announce, it'll be on the DL. You can tell people what it is when you make the check. You don't have to, you can. We just weren't sure what to do. And so I just went around town and I said, Okay, I started this thing Open Angel for him and I tried to kill someone called Kuretsu for him, which was charging people five million dollars. Remember. So I went to war with them and they got really upset and called Michael Moritz on the phone.

53:12 Who is this employee of yours? She's like not employee of ours. Well he said he's gonna kill the cr he's gonna kill the karatsu for him and he's like w why would he say that? And Maritz called me He said. Did you Jason, did you tell them you were going to murder them? I was like, Yeah.

53:27 You really love uh these situations where you you take a mild mannered Brit and you really in a way where they have to have a talk. No, no Michael Morris was not angry. He's like why why would you tell him? And Maritza's cool as I um he's the greatest. And I said, Well, they're charging founders five thousand dollars to meet angel investors. He goes, Oh, that's terrible. I said, Yeah, so I want to kill them. He's like, Oh okay, carry on.

53:50 That was the end of the phone call. It was great. So great. So anyway, uh I started Open Angel for him and I just started you know thumbtack. uh style seed, data stacks, all these signposts, all these great companies just came and Uber actually. Yeah, and on the spot myself. Saka was there, but Sokka knew Travis before and uh Siam Bannister invested in them. I introduced Siam Bannister to them Tiken Uber, she's always been very gracious about giving me credit for that. And I'm first round, I I think I introduced them But I think that maybe they claim I didn't or maybe somebody else in the firm had heard about it as well. Who knows? You know, like

54:26 A success has a million million father. Father's an orphan. Okay, so all this is go what what's going through your head as this is happening? Like you're running Mahalo. Mahalo's super high. Yeah, I mean they anointed me. You know, Sequoia now anointed me. Now I became dangerous because now I wasn't just East Coast anointed, I was West Coast anointed. You understand? Yep. And nobody really had ever done that. That was a very unique thing.

54:48 And I knew it. I think a lot of our audience probably has not ever heard of Mahalo. So fill us in real quick on the thing. I emailed Michael Moritz, John Dore, and Mark Cuban. And I said

55:00 I have an idea for my next company. I didn't know any venture capitalists. Even through all this, I really didn't know any of the West Coast venture capitalists, but I knew John Dorm, Michael Moritz were the number one and number two. probably in reverse order, Mike Moritz and John Door. But anyway, there's a argument about that. I had run into Moritz one time at like a conference. He wouldn't remember me, but I emailed Michael Moritz and I said, I have my next idea for a company. I sold my last company to AOL for thirty million dollars eighteen months after I started it. Would love to get your advice. Shortest email possible.

55:28 With a little microphone drop in it. And Maritch called both of my phone numbers and emailed me and his assistant called me all within one hour of me sending the I was gonna I was gonna ask how many minutes did it take to respect. John Door Uh somebody on his team got me the next day. I was in both our offices next week and also Mark Cuban said

55:46 we turn just hundred fifty into five or six million. So he said, put me down for a million. Uh or whatever you want, Jason. Uh I think there was actually a second payment coming and he just CC'd his attorney and said, Whatever the second payment is for the AOL thing, and it was like a million bucks. He said, Just throw it into Jason's next thing. Which is you know very more Cuban thing to do. Okay, so here's the question, did you actually have the idea or did you just say that? I did. I did have the idea. And my idea was I had gone to uh Wikipedia was like the thing at that point in time. And I went to Wikimania, which was like their conference up in Boston.

56:15 And I studied the wiki software. I started playing with it and I made a little proof of concept where Google was dealing with web spam at the time. And the order of the links weren't very good. My wife's Korean and I had heard about Down D A U M.net. and comprehensive search in Korea. And in Korea, Down owned the blogging company.

56:36 And the picture hosting company. And they when you did a search, they would show pictures There's your link, pictures, and blog posts. On on one page. And so I made this comprehensive search and I said it's gonna be called twenty dot com.

56:50 The top twenty links write a keyword. I went into the meeting. And I put three pieces of paper on the table. And I I don't think I've ever told the story. And uh I I said um

57:00 iPod. Look at these ten blue links. These are the search results. One's Yahoo, one's twenty dot com. And um one is Google. Which one do you like best?

57:12 And Maritz and Rulov pointed to them one and they turned it over so turn it over. It said twenty dot com. I said turn the over to him for. Well I did it again, I said Kawhi Vacation. And they picked mine again. And I said they said, How did you why is yours the best? And I said, I had a human look at the Google result and make a Wikipedia page. And they said, That's great. And Michael Mar said, Oh that's a great idea. Um what are you looking to do? I was like

57:32 Uh, I want three million dollars for twenty five percent of the company. And he said, Okay, work with Roloff and he walked out. And he was on the board of Google and he's like, I can't be on the I can't do this, but It's not competitive with Google. It's you know, whatever. It's a wiki, whatever. And um that was the start of it.

57:48 And then my friend Elon put some money in. Uh he was just casual working at a rocket company. He just called me. He's like, I think you're smart, I'll put some money in. And then uh Ruper Murdoch put some money in, CBS put some money in, just a bunch of people, and you know, whatever. I was I was on the top of my game, got the company at ten million dollars in Google AdSense revenue, and then Matt cuts Uh. Like we were. getting too big and eHao was getting too big.

58:15 Uh there's also uh cosmics, right? Yeah, cosmics, wiki how just there was a whole cohort of us making content. And let's let's pause for a minute just just to catch everyone up on Matt Cutz. So Matt solved a really hard problem for Google over the course of a decade, which was basically Link spam. It's how do we stop people who are gaming Google and getting too high in the rankings and getting too much traffic and abusing us? Yeah. And I think Matt actually is leading a really important initiative now in the federal government at the um The US Digital Service. Well what would happen is Our pages were so good.

58:46 That Kawhi vacation. Would rank in the top five. And people would blog about it, link to it, and ask us to update the links, and then we started putting content on the pages. So we had content on the pages. So basically Google this was all on their roadmap, but I created was on Google's roadmap five years, ten years before they got there. Because if you Google Google quiet.

59:06 Google. You get that now. So I was five or ten years ahead of them. Um and they were gonna do it machines that Marissa said, I don't think Jason's right. We had this like debate um at the at a conference at one point. Somebody asked her about Mahal. She said, I don't think humans can scale up. We're going to do it with robots. Anyway, then they basically took ninety percent of our traffic away and the punchline was They took ninety percent of their own revenue away because the way we're monetizing was with

59:28 Their tools and then I said to Matt and I called up Sergey Brand and I called up everybody I knew there and I was like, What are you guys doing? You just killed my site. I have to lay off a hundred people. And we got this big public spat. And uh they're like, Yeah, you know, we don't know. And I was like, Well, we're partners. And Matt Cuts is like, We don't have partners. And I was like, I forwarded him the email from the AdSense team. That's that partner meeting.

59:49 And that they you know, and partner lunch and partner this and partner that. And he's like, Yeah, that's a different group. I'm like, but you're still Google. And they literally took everybody who would eventually become competitive with them and they just neutered us. And this is why I think You know, Google will face antitrust action like they did in Europe. maybe here eventually. And I think Yelp's right. What they did to Yelp same thing. Was equally bad. I mean they basically studied us Copied us.

1:00:11 Killed us. But I mean, I learned a really important lesson there, which is like don't have a dependency. But the problem was, you know, it just then grew so quick, I was like We're making we're on we're on a ten million dollar runway. We're making Just a lot of money every day.

1:00:25 at the peak in AdSense and this is all hunky dora. I was like, they'll never shut us off. We're we're sending We're giving thirty cents of every dollar to them. Yeah. And I was wrong. You know, they had a long game. They just didn't want Mahalo.com and other things to exist. So they killed us. And then I pivoted it to inside.

1:00:41 And it's still going today, twelve years later, and you know, it's it's actually doing really well for email newsletters. Wow. Exactly. What's what's going through your head at this point in time about like okay, what is your Next act. Well the scouts thing I didn't take too seriously. I just thought it was a fun diversion.

1:00:59 Um, and then they got about uh I don't know, halfway through the program and Rulov said to me, you know, nobody else is making investments. I think like Sam did Stripe or something, you did Uber and you did four and Sam did two. Sam Waltman had done strike. And uh they said, you know, this fund we might not do another scouts thing, so you know, you've got like a million left in the fund and I was like, Oh, hang on, you're not gonna tell me the buffet's over. Thumbtack. Data stacks. Data stacks. I mean that fund is the greatest fund. in Sequoia's history on a percentage return basis, I believe. I don't know that for sure. Not on cash though. Not on cash. On multiple cash. On multiple cash, it's definitely in their top five, I would think.

1:01:41 But it's saying to you, we don't know if we're gonna do this again. Well, it was very early days. We didn't know. Um and they're like we still have all this money left in the fund, so rule of if you want to make some more. So I did nineteen investments, I put seven hundred to work, it became worth over a hundred million in total, all largely due to uh what uh an uber And then My friend Naval had been coming to the open angel for him'cause he was doing venture hacks and he was an angel investor. And he said, Listen, I'm going to start this thing angelless.

1:02:07 And it's kinda competitive. So and I was like, No, this is you're doing online. Online is dumb. I you know, like ain't nobody's gonna invest online. It's all in person. And he's like, Yeah, I d I disagree. And I was like, Yeah, I don't uh I don't know, Naval. I don't think I don't see anybody investing blindly online. He's like, Well, this is new thing, SPVs and syndicates. And I was like, Explain that to me. And he explained it to me, and I was like, I don't understand it. Explain it to me again. Explain it to me again. you know, angel.co slash Jason slash syndicate and it said, you know, set up your syndicate here and I filled out the stuff and I tweeted it.

1:02:37 And then he called me on the front and said, What are you doing? And I said What? And he said, You're not supposed to tweet it. I said, It says on the page, tweet your syndicate. He could I didn't launch it yet. It's launching on Monday. And I said, Oh, I'm sorry, you want me to take it down? He's like, No, don't worry about it. Twecron just got the embargo, but they're upset. Um I was like, nobody's gonna see it. It's on Twitter. Nobody's on Twitter. And it's it's also so interesting that like in your head you're like, this is I don't I don't get it. Why would people sort of like invest alongside another person without ever meeting the company in person and that's what Sequoia was doing with you. They were giving you money and saying that you're I'm not saying I'm the smartest guy in the class. I never said that. That's not my claim. I'm a hustler.

1:03:14 All right, that's why I made that self deprecating joke in the book that you were so nice to read, you know, like I am a hype guy. Um I'm not a complete fraud. I'm that's kinda me being self deprecating, but uh you know, I'm definitely been lucky and I'm definitely good at hyping things. So I mean that's why Naval sent me the link. Anyway, a bunch of people join. Tim Ferriss launches his own. I don't think we should glaze over this, like the set of people you've already talked about, clearly there's something special about the way you build relationships. I mean you're you're you're I'm trying to spot yourself like as a as a hustler, as someone that works hard, as someone that is extremely driven, but lost in, I think the way that you think about this is Oh my God, are you good at at building relationships and and

1:03:53 making it so people want to help you, like helping them, knowing that over the next ten years, that's gonna be a good bet. Um, I think enthusiasm is contagious. Um, so I've always been very enthusiastic what I do. And I always pick up the check. And I always set up dinners with a lot of people. And I always introduce people to other people with no intent of

1:04:11 capitalizing on that. Like Tim O'Reilly. invited me to a foo camp early on where Larry Page came in his helicopter and landed it outside of foo camp. And I was like, Larry, what are you doing? Like you realize how douchey it is to land your own helicopter? He's like, Do you think so? It's like dude, come on, man. Just land it at the airport. I mean, we know you're rich. Like you don't have to fly your helicopter from Palo Alto. It's like you're probably right, Jason. I totally admit it's flying. Uh.

1:04:38 But he did literally have them clear the field so he can land his Helicopter. He was taking helicopter lessons at the time at Foo. So I'm not speaking out of school. He literally landed his helicopter there. Um anyway. Um Tim O'Reilly said something about like

1:04:51 I ca I can't remember the exact phrase you'll find him put in the notes, but he said something about like it the if you extract very little from the network you're building, you do really well. That you don't need to extract all the value. Yeah, it's like the Bill Gates platform quote. Something like that. Yeah. But he evolved. He said it better. Uh we'll come to it, but this is Sort of thing about networks. Anyway, so I was always just introducing people to everybody. In fact, I remember when I was at the top of my game with In Gadget, I was at Sundance.

1:05:16 And my friend David Sachs was producing a movie there called Thank you for smoking. So we were all there. I just saw Weblogs Inc. Elon. Myself, Sacks, we're all hanging out, my wife and uh his wife at the time and Sachs' new girlfriend who's now his wife. And um

1:05:33 Well, Mossburg is there and he says, Hey, let's have lunch. Yeah,'cause he knew I was there. I was like, Yeah, sure. Um and I was like, Hey, you know, let's meet over here. I'm gonna bring my friend Elon He's like, Who? I'm like, Elon Musk, he's doing this like thing or whatever. And you know, Walt Mossberg was very big, and he's like he wrote me this admonishing email I agree to have lunch with you, not Elon Musk. You forcing me to have lunch with this person.

1:05:55 Like is just unfair, like our friendship, whatever I was just like, Oh okay, I won't bring them. You know, Walt was very sensitive at the time, everyone's trying to get to Walt. And so he felt like I I was trying to put Elon in front of him and Elon didn't even know. I was I I was just like Elon's here. Elon wasn't running Tesla at the time, he was just an investor and he was doing the space like stuff. I was like, You should meet my friend Elon. So so you're good at at I was always good at just connecting people and meeting people together and just hanging out with people. Like my book agent, John Brockman, had introduced me to Sam Harris. You know, Sam was on my podcast and he did like a AMA from A Hollow. And they say, How do you do podcasting? I was like, you know, you're built for podcasting. So you think I should do a podcast? I was like, absolutely, you're built for it. He's like, What do I need? I'm like, a guest and a microphone.

1:06:34 He's like oh I was like, You can use my studio anyway, I convinced him to do a podcast and now like the rest is history. Um and I introduce Sam To Elon. And then

1:06:44 We all started talking about AI. And Elon introduced Sam to A the concept of AI and all this AI stuff going on in the book Superintelligence and all that. And then The people who write Westworld Christopher Nolan. Yeah, and Lisa Joy. Then met Elon and Sam

1:07:01 And if you like literally the entire season This year, I'm watching it, I'm like, this is a conversation I had with the four of these people. I've been like three or four years ago. It's pretty surreal. I always picked up the check and I always brought everybody to dinner. That's why I got good at this. And I'm you know We're not doing playbook this episode, but this is the uh little

1:07:22 Okay, so I gotta ask though that that playbook that Mindset. That wanting to do that. power and Connecting people.

1:07:33 Yeah. As Mahalo is, you know, post Panda going on. Yeah. The panda is the update that Google did, yeah. Why do you not go join a venture capital firm and become a traditional venture capitalist? Self awareness. Yeah. I mean, you can't have to be a V C, as we all know. Well

1:07:52 Here's the thing. It's Called the venture partnership. And that's not what I do, right? Like I like to make my own decision and I'm like the solo artist.

1:08:02 Like You put somebody like me in a band, the band will break up. Like Row is Bob Dylan, not like any better. Yeah, you know, like you you I could play

1:08:12 You know, I c I could play with Tom Petty and the Heartbreakers, but I'm gonna write my own albums. I wanna do my own thing. I don't want to I want to keep it small and authentic and true to what I want to do. And I'm I I did have a a bunch of venture firms uh over the year make runs at me and then maybe want to incorporate my little empire into their empires. uh you know, it'd be a pretty good feeder. You could plug what I'm doing into something bigger. If you were a

1:08:35 billion dollar late stage fund. Imagine having, you know, the only real viable Y Combinator competitor out there. As the top of your final the only real angel list. coexist or competitor. Th these things are not really competitors when you think of them. They're really coexistors, but you know, we're the number one largest syndicate in the world and Angel list is the largest collection of syndicates, but if you took the top two or three syndicates together, they would be smaller than ours. Um on Angel List.

1:08:59 And then you look at our program, like we're really the only people who compete with Angelist head uh with a Y Combinator heads up, like the only reason We've had people pick us over Y Combinator and people pick Y Combinator over us or go to Y Combinator, then come to us. Like we're really the only I think accelerator could say that. All right listeners. Now is a great time to thank our longtime friend of the show, ServiceNow.

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1:11:04 Jason, I wanna tee this up in in this direction. So you wanna be a solo artist, not I am a solo artist. I'm not join a band. Or I'm sorry, at this point in time, I'm just playing through what's in your head. Yeah. You want to be a solo artist, but you also deeply understand returns to scale. As you're thinking through This week in startups, the syndicate, which I want to really understand mechanically how that formed and how that works. How are you thinking about scaling what is working for you? Yeah.

1:11:30 I had started the podcast as Calacanus Cast, and we did forty episodes or so of that. Just on an open microphone in a room. And I did it with Ron Conway and I did it with Ev Williams because my friend Dave Weiner had started who'd create an RSS.

1:11:46 Said hey Jason, uh check this out. Um you can attach a file. To an RSS feed, I was like, Oh, you could put a PDF in there? He's like, Yeah, you could put a PDF in there, but that's the same thing. And I was like, Oh, yeah, again, I'm not the smartest kid in the class. He's like, Check this out. And it was an RSS feed with MP threes. And I said, Oh He's like now check this out and he sent me a little script and it took the RSS feed and then it

1:12:08 wrote the MP three files as an album Into your iPod. And the reason it's called podcasting Is because you could sync your iPod on your Mac to an RSS feed.

1:12:21 that then put it there. So The idea was you would plug your iPod in at night to sink and to b charge. Cheer Mac. And also it podcatch, it would download at night all those things, and when you got on your commute, You'd have a couple of podcasts on there.

1:12:35 And I was like, Wow. And then they convinced Steve Jobs to add it. To iTunes. And there's a famous clip of me talking with six or seven. Yeah, and there's a famous clip of me Talking to Steve at

1:12:48 The D Conference. um and ask him a question about it and I asked him about making money if you would ever sell advertising on podcasts or whatever. And I he said, You know it's a really good idea. You should just email me, Jason. I said, Yeah at the email I always email you at and he said, Yeah And the whole audience. But I just said it as a joke, like being a wise ass. You know,'cause I did talk to him on email. And so I thought it'd be funny to say, you know, like the email we always talk on. I mean all of these crack's up. It's a very funny clip. Um But anyway, I did the podcast because

1:13:15 I just thought it'd be fun. And to me, it was just a fun way to promote my friends. And so, you know, I had Brian Alvey on my longtime collaborator as a first guest, David Sachs came on early, just uh you know Jason Nazar was starting a company, just having people on when I was in LA and it Then bing.

1:13:30 uh was gonna launch it. Somebody from Microsoft called me and like, hey, we love this like podcast thing you're doing. We want to tell you about something secret. And I was like, What is it? He's like, We're starting a surgeon. I was like, uh everybody knows. He's like, Yeah, it's called Bing. I'm like, Well, that's a terrible name. And he's like, uh well anyway, w we want to advertise on your podcast. This is eleven years ago. And I was like, Okay You hadn't thought about you hadn't put two and two together. It was just like it was just a thing.

1:13:54 But of course it was just like when you're starting Silicon Valley Reporter, Web Light, like it's it's the any time a new medium comes out, I I assume it's gonna work. This is my big trick in life. Whenever something comes out. I just assume it is going to reach critical mass and I behave as such. So when blogs came out I was like

1:14:12 Okay, I assume it's gonna work. I'm gonna go full bore as if it's going to. When podcasting him out, I went full bore. Whatever everything comes out, I just if I if I'm interested in it, Twitter, the same thing. I just went full bore on Twitter. When has that not worked? Oh God, probably more times than I can count. But I mean it's Uh but they but it doesn't matter when it doesn't work. You know

1:14:34 There's a bunch of Sir uh Path dot com, uh Friend Feed. There was a bunch of other things. But if you take the Robert Scoble, relentless enthusiasm, like spastic, like Oh my God, this is gonna change everything. Google Buzz. Google Plus. You know, like I was all in on their services too, and that was all waste of time. But you know, when it does hit, people remember the hits. Like it's just the same thing about it that you guys know about investments. And returns, yeah. Yes, asymmetric returns. Correct. If you if you get in early and you have the

1:15:00 the you know, you're you're baking in whatever that service is, and you got there ear, you're gonna you're gonna have a head start on everybody else. So then it just worked for me. And then They bought they were like, How much are the ads? And I was like, Um Uh, three thousand dollars. I'm like, okay. uh par add. I was like, Yeah, but you have to buy ten. And they're like, Okay, thirty thousand dollars. And you just sent me thirty thousand dollars. And they're like ha I was like they're like, What is the ad? I was like, I'll just talk about Bang. And so I literally just pull out Bang and I'd be like, Hey, check out this feature, check out that feature. Thanks, Bang. Bing, bing, bang, and then then we'd die to the end of the ad. It's pretty funny. So great. Yeah, we just goofed off.

1:15:33 And uh we'd have puppets on the show. We just It was just this like vaudeville kind of approach to it. Uh, but then it started getting a little you know, it went from like, you know, five hundred to a thousand people would see it to ten thousand, twenty thousand. You know how this stuff goes, two hundred thousand, three hundred thousand. All of a sudden it becomes a thing and what's the listenership on this week in startups now just to get people. Over two hundred thousand per episode, yeah. Yeah. So you guys are right on my tails. It's a niche podcast by design. Like I could make it get bigger by dumbing it down or going shorter or having post production on it. But I just told everybody I'm not interested in that. And and you know, Joe Rogan has taken the same approach, the same, you know, Howard Stern like approach as you put the recorders on, as long as it's interesting, you go.

1:16:09 And we have three ad slots and we sell them out every year and it does, you know, a couple of million bucks, and uh it's enough to pay for a seven, eight person team that works on the podcast now. That's awesome. And and how does that play into your angel investing? So to take us. Well it's very simple. Yeah. I mean I I would say on the podcast, hey, uh you know, here's a company I invested in, I'm having them on the podcast, or in the case of com dot com Somebody had told me Alex was like a genius. And I was like, why? And he's like, Well, did the million dollar homepage? I was like, Oh, that was genius. He's like, Yeah, do a meditation app. I looked at it, it was a web page where you went and I just played a meditation. In a loop.

1:16:43 And I was like, Yeah, how about the podcast? I need a guest. You know, back then it was just like, can we get any guests? And so Alex came on and so On the episode, I said, Hey, can I put twenty five K in? You know, for like one percent or two percent or whatever. I did it live on the episode. And yeah, I was always trying to get somebody to do that and nobody would do it. But I thought it was funny. It was entertaining for me. Anyway, long story short, he, you know, I put fifty K in for my fund and This Angelist thing had just come out and I made it the first deal on Angelist and

1:17:10 My expectation was that maybe another twenty five K would come in or fifty K because I had like Yeah, I don't know, like I don't know, a hundred, two hundred people had signed up. So I was like and three hundred twenty eight thousand dollars came in. And uh the company was worth four million or five million at the time. We had a six or seven percent position. That company's worth one point four billion now.

1:17:30 Uh it's the most successful syndicate in the history of syndicates. In fact it's probably the top three syndicates combined would be smaller than the composition. And for people that have never used Angelus, how does that work where you're like, Hey, I'm in for fifty. How is it that like Well the original deal was Um, Angeles would take five percent of the carry. I would get fifteen percent. I subsequently negotiated an eighteen and two deal.

1:17:53 Which led to a lot of animosity. Eventually Angelist and I broke up. It's a that's another sort of tale, but you know, Naval and I are friends still, but We were just a little too big for it and that's you know, like back to being very clear about like I'm not the bull you want in your China shop. Like I know that some people think like wouldn't it be great to buy Jason's company and put it as part of this big venture firm? The answer is no. Because I'm gonna do what I want and it's gonna knock shit over inside your place, right? Like it's not good for you.

1:18:18 Um It's not good for your partnership. If you're trying to build a partnership and you want five or six people just sit there and have like a really good conversation and dialogue about an investment. That is the that to me would be Perfect nightmare.

1:18:31 It's literally my nightmare. Like I wanna make an investment because I s look in the founder's eyes and I push the chips in. I do not want to have five people sitting in my seat while we discuss if I should go all in on this poker hand. That's the opposite of what should happen in early stage investment. The second you debate it. is the second you lose the outliers. Because the outliers make no frickin' sense.

1:18:52 So anyway, consensus equals death in the early stage. Consensus at later stage equals protecting downside risk and due diligence and all that stuff is very important. I get it. Can we digress for a minute before we pick back up with the story of the sort of Your Empire, but Talk to us a little bit about your philosophy'cause I think it's super

1:19:11 It's super incisive about the difference between bet and like informed by poker shaping your bets experiments versus investing Yeah. So Here's the thing. Imagine a poker table existed in the world. Where

1:19:25 You would buy in for ten thousand dollars. And there were ten players. There's a hundred thousand dollars on the team. But every One hundred hands. You could win.

1:19:38 A million dollars. Or ten million dollars. So there was uncapped upside. Somebody just gift it nine hundred thousand extra dollars or nine point nine million extra dollars to that table. It would change the way people played.

1:19:51 It would change the game. There would be and that's called the world series of poker, by the way, for pros. 'Cause the world series of poker When they have that series of like fifty, sixty games, all these amateurs come from the world dead money. People who are easy to pick off.

1:20:05 It's like for the pros for Phil Helmuth. It it's literally like if you started the NBA finals and The Warriors had to play against the high school team. We're like, Well, we're just gonna win a lot of games here. It's the only way to get asymmetric upside in poker. Correct. I mean there's there are ways, but but yes, asymmetric for sure. So anyway, once you realize that

1:20:24 Yeah. Frees you from You trying to understand if the idea is gonna win or not. That's what trips. Early stage.

1:20:32 investors, which is why I wrote my book. is because I felt I had figured something out and I wanted to share it with the world. Which was This is the greatest casino in the world, in my opinion. And nobody knows about it.

1:20:45 And the people who do know about it. Do not want to talk about it. And then another group of people think it's the stupidest thing in the world and a scam. And I why is that? Well, most people come into Angel Investing who I meet who think it's stupid and they

1:20:59 had five hundred thousand dollars in their bankroll and they gave two hundred fifty thousand of it to their Uh daughters Sarori sisters boy for ex boyfriend's brother. And because you're gonna build an Instagram competitor that has links in the comments. 'Cause Instagram doesn't support links in the comments. Like that's the reason like they're gonna exist. And um they put the two fifty in, the product never gets released. They gave that two fifty to dev shop in Estonia that never finished.

1:21:24 They ask for another two fifty, they give the other two fifty, the product comes out, nobody cares, they shut it down, those people go work at uh Boston Consulting Group or whatever. And they made one bet, so it's literally like walking up to Blackjack. And putting your entire stack on one hand. Like it's just not enough Or like in poker leg betting me going all in before the flop. Yeah, before you look at the cards. You're just like I'm gonna sit at this table and put it all in on the first hand. Which I know some people who do that for fun. For people that are not professional investors, it sounds ridiculous to dumb it down this far, but like even if you're only making five, six, seven angel bets and you're not really creating a you know, twelve, fifteen, twenty company portfolio, it's it's mathematically the same thing. You you're taking way too concentrated of a bet.

1:22:05 Really and You need to really hit twenty or thirty or forty in what I've seen in angel investors who succeeded. And you have to be investing in a certain pool of entrepreneurs. If you're a nobody who starts out Any deal flow that gets to you. by definition is been picked over by all the qualified people.

1:22:24 If you're reading scripts in Hollywood as a first time director, And the script got to you? That means Every director. has passed on it and never got to the good director. So just understand that.

1:22:36 And then what I wanna I wanna go deeper on. 'Cause I I think this is there's a really important insight here. How do you square the what you said a minute ago about Consensus at the early stage consensus kills because you want the crazy stuff you can't predict with this aspect of you need the high qual like what is the signal and the quality. Yeah. So What I

1:23:00 teach we have a course called Angel University that goes along with Angel of the Book and In that course I explained to people that when you make your first twenty or thirty bets. Make as small a bet as possible, which means using syndicates is a good idea. Forget about mine. Just sign up for everyone'cause it's free to read the deal memos and you'll learn.

1:23:18 But If you do that, you're Playing at the lowest stakes poker table while you learn. Like literally, if you could play one dollar blackjack, if you want to learn blackjack, Sit at the one dollar blackjack table instead of the hundred dollar a hand. 'Cause you're gonna lose a minimum and it doesn't matter if you lose, it's just the education it's like paying for an educational course.

1:23:35 And I tell people only invest in companies, startups that have gotten their product to market and have some customers. hopefully paying customers, but if not customers who are using the free product that you can at least talk to. You've now eliminated, as you guys know, ninety percent of the failure rate.

1:23:51 Ninety percent of the Tritian in startups comes. They never ship the product. Then you get down to that ten percent of that Ninety percent of those never get a paying customer. So if you were as your a a starting angel investor to only invest in companies with some amount of revenue, even As little as two to

1:24:07 ten thousand a month. You probably have eliminated eighty ninety percent of the risk. So start there while you're learning. And then as you get more sophisticated, just like in poker If you want to play under the gun With Phil Helmet at the table and you wanna play nine ten suited? Okay, maybe.

1:24:22 If you've been playing for ten years. But you don't want to take those kind of risks and bet on a meditation app Or a a couch serving app when you're just getting started. There's five times you could have invested in calm Maybe three, four, five times a comm, three, four, five times in Robin Hood. Even these outliers, Airbnb, you probably have four or five chances to invest in Airbnb as an angel investor.

1:24:41 It's a misnomer that you're gonna miss the deal. Like what Y Combinator does to angel investors and telling them, If you don't invest quickly within these forty eight periods, the deal's close and you miss them forever. It's like just literally not true. It's literally they try to create A false sense of urgency. They train the founders to do this. And it's nonsense.

1:25:00 Not only is that round not closing immediately, there's gonna be four rounds after that you can get into. No great investor invests at demo day. Especially now with safes and not price rounds. Like that it's rolling. I mean it's not rolling. Yeah. Super rolling. There's one thing you said that is I think is really insightful. when you're not Philhelm youth and you're playing poker for the first time, like Just invest in things that have shipped and have revenue. And then once you get better and better and better and you become Jascanus, you can invest in Calm.

1:25:27 why are you comfortable at the level you're at investing in a No revenue meditation website. So I can take it to the background. It was very simple. Um I had known Sam Harris.

1:25:39 I had done positive visualizations. I had heard that term. And I use that in sports'cause I was a psychology major. I had done positive visualizations to get through the Mar New York City marathon, which I did eleven of. I didn't know it was called meditation, but I just positively visualized myself along the route. And then when I did the run, I had had that in my mind, how good I was gonna feel at each each part and how

1:26:00 The Bronx and the Wall was gonna be difficult. Then when I saw Calm. I talked to Sam Harris about it because he was studying uh you know, he was doing CAT scans of brains, um, and he was a meditator and uh into psychedelics and all this stuff. And he put me in touch when I was doing my research on Calm. With a woman who ran the mindfulness center at UCLA and I found out that

1:26:21 Phil Jackson, who I had known when I was in LA when he was coaching uh the Lakers, I had become friends with him, and uh He had Kobe and Shaquille O'Neal meditating, and I just it It clicked for me. Wait a second. Phil Jackson innovator, Sam Harris innovator.

1:26:38 There's something at UCLA around the corner for me and Brentwood. They're studying it. They have a program. They're teaching people this. Oh, they're studying it on P T S D soldiers This is the future. But unlike yoga, which also started in Santa Monica. This can be delivered through your ears.

1:26:55 Wait a second. Yoga you have to do in person and yoga's everywhere. But meditation is delivering your ears. If this does work And it becomes as popular as y yoga, there could be a hundred thousand people paying for this. Be like a ten million dollar a year business.

1:27:11 Companies were four million, this could be like the future. And that's when it all clicked for me. And it was like an easy bet for me to make. And then the subscription service came out. And Apple allowed subscriptions. When I think we invested in When we invested in common, I think they had done ten thousand in revenue, you know, selling a month.

1:27:28 Do we was a post revenue startup. They had post revenue, yeah, yeah, they did. But with with Robin Hood they didn't. Robin Hood hadn't launched yet. So that was another one where I just, you know, I saw them and it made sense to me. So you know, you you can get signaling. I'm not saying you can't do this. But if you wanna reduce the amount of pain you're gonna go through And you want to have a

1:27:46 A less painful Junior year. Like your junior year as an angel investor when you hit the J Curve. It's so painful. Because you think you're an idiot. You've deployed all your money, nothing's break out yet, and you don't have any you can't

1:28:01 Keep investing. Oh, and half your portfolio can't raise money and it's shutting down, and the other half can barely raise money and they're begging you for a bridge. Like literally the junior year Everything tells you to quit.

1:28:13 And then all of a sudden you're four or five or six. You know, Travis calls up and he's in six cities and he's closing around with Menlo at three hundred million. And you're like, Wait a second, five million times sixty and Holy That's a lot of money.

1:28:29 You know, you start saying, Oh, whoa, this could work. And that's when you When once you hit one of those unicorn type investments Then all of a sudden it clicks in your brain, your brain chemistry changes. You have to have the brain chemistry change. From being risk averse and outlaw averse to

1:28:47 Outlier obsessed. I am outlaw obsessed. I do not care about losses. I I literally and that took me a long time because remember I was such a rapid competitor. The idea of being fine with losing all the time

1:29:01 Like imagine losing twenty nine nights in a row at poker, but on the thirtieth night you hit a five thousand X or a two hundred X. Right. It's'cause you're you're playing in this very special poker table right now where the losses don't matter. Supposing that you actually are fishing in the right pond where you do find those magical ones. Correct, Amundo. I think there's one more layer though that I don't think we've touched on yet that I've I've heard you speak about before. Which is shaping your bets into this. And like as you're making these

1:29:30 Angel investments. Keeping them very small. And thinking of them as experiments. It's a failed experiment. Correct. This is why I started the launch accelerator three years ago. We have a hundred companies I've gone through and we and I basically was like

1:29:49 What was Paul Graham's original idea? Oh, six or seven companies? Great. I'll just copy that. Seven companies. And Paul was the draw, right? And now it's the legacy's the draw. Paul Graham's not the draw, it's the legacy. So I said, okay, we'll If Paul was the draw, I know I'm a draw. So let's see if it works. And I just said seven percent of Uh six percent are preferred for a hundred K, which is a one point seven million dollar implied valuation.

1:30:14 So It uh we'll go with that. We'll just start accepting seven people at a time and deploying seven hundred K at a time. But then I added something. Which was

1:30:23 You know Y see imagine if Y C an angel that's got married. Or merged. What would that look like? Well that's what I had.

1:30:32 And I had left Angel List and I had Started the syndicate. Dot com and it took me a while to get that domain name, but I got it. Coveted that one. I I'm a domain name coveter, I'm a brander. Anyway.

1:30:44 The point is I I s I started saying to people, I'll put in Uh fifty K for the original deal was like fifty K for five percent. I put in twenty five K Uh for five percent, then I'll put twenty five K whatever your recent round is, and then I'll syndicate it. And uh then it was too hard to just syndicate all of them because not all of them wanted to do the syndicate. So then I just said, Okay, we'll put it in a hundred K. It's the same deal as Why Commodore at the time.

1:31:07 So then we're betting on these at for a one point seven, you know, rather than up to two million dollar valuation. And then one of the companies raised around And I was like I always told myself, Well We'll put more money in. in the seed round.

1:31:19 And we'll try to get to ten percent ownership. And then Like two of the best companies raised rounds and the and the founder was like, Well, we have no room for you. I'm like Yeah. What? I was like, I I introduce you. So I called up those people who were doing the rounds and I read them the Riot Act. I said, I introduce you to company. How dare you try to m muscle me? I said, You're swinging an elbow at me?

1:31:39 I said I'm the point guard. I passed you the ball! And now you're You're you're you're not passing the ball back when you're triple team? Like pass the ball, move the rock. And I got both of those people to give me allocations.

1:31:51 And then I was like, Well, this is not how power is supposed to work. Um Like if I'm the point guard, I have the power. I have the power to freeze you. So then I said, Okay, now the freezing will begin. So I wrote into our documents that we have the right To do half the next round. It's a hefty pro rata, my friend.

1:32:10 Not if you're Jason Calcanus. And it not if you're the founders. It's a feature, not a bug. Yeah. It's a feature for the founders who we work with because they can start their fundraising with me as an anchor.

1:32:22 And and and they do. And do you so d so do you pick winners? Do you say, Hey, you three, you guys are getting the half the round from me? Yeah, w we've evolved it over time. So In order to make it more fair to everybody. What I say to them is

1:32:36 If you're tripling revenue If you're doubling revenue six months Um we're likely to just preemptively make you an offer. If your performance is in the top like five percent. And we've done that.

1:32:48 And then we'll let other people invest in it, but we'll actually price it around and put in five hundred K or two hundred fifty K and get them started. I said for everybody else, if you're not like Just crazy outlier. Uh we're tripling revenue, you know, every six months or something during the program. Just go ahead and but we we'll still leave room for other people. When you get your term sheet. Give it to us.

1:33:07 We'll have five business days or something to make a decision and we'll let you know what our what allocation we want to take. But we'll usually do it in a day or two, which is actually what Y Combinator announced they're doing now. That they're doing now, yeah. Yeah. So they switched to my position. And because I think they were experiencing the same thing, which was they were getting boxed out of their winners. And so now we just say, Give us a term sheet and if it's a reasonable term sheet, it's not like Something outrageous.

1:33:30 Um or non traditional. Like we had one of our successful companies do a deal for common. shared a ridiculous price with some non traditional private equity firm and we passed. We said we'll just stick with our six percent. But other times we'll put in five hundred K. And so for a company like Fitbot a major breakout for us. They came to us with just two thousand dollars a month in revenue.

1:33:51 I think, or maybe a thousand. And uh they've been public about, you know, hitting um eight figures in revenue. They were public about that at the launch festival. They gave a keynote. We offer and I offered them live on stage uh two million out of fifty million posts. But anyway, we wound up putting more money in a couple of times. You know, we built our position up to, you know, over ten percent. So that's what I'm trying to do now is just get to ten, fifteen, twenty percent. And eventually You know, with our fund, the syndicate. You know, and the accelerator

1:34:18 We can make three or four bets. in the company. And get to know the founder. And if we can

1:34:28 We'll be the first people. To combine Why combinator? Angelist. Slash C invest, slash republic, whatever, crowdfunding, you know, syndicate you like.

1:34:39 With a seed fund. Like homebrew or pair or whatever. So that's what I'm constructing right now. We don't have a proper series A because we don't need to because the fun plus syndicate kind of hits the one two million dollar number. But you know, the next fund perhaps will be able to do a full A, like a five million dollar A.

1:35:00 But I don't need to do that. I kinda like being in the early stage. It gets less interesting for me. To to to go and do the, you know, big checks. And I and there's so pe so many specialized people I thought I'd rather hand it off to Sachs or Tremoth or Bill Gurley or Yeah, rule off or somebody like that. All right, listeners. Now is a great time to talk about one of our favorite companies, Statsig. Yes, there is a reason why the best product teams rely on StatSig, whether they are iterating on their core product features or shipping AI powered experiences at scale.

1:35:33 Yeah. In the crazy speed of today's AI world. Shipping fast is just table stakes now. It's basically trivial to build and deploy your app constantly. The real advantage is how quickly you learn what changes actually created value for customers.

1:35:50 And how fast you can use that signal to guide what you ship next. This is where StatsIG comes in. It brings experimentation, feature flags, and product analytics into one unified system so teams can ship safely, test rigorously, and directly link what they changed to how users actually behaved. So if you want to make learning your competitive advantage, whether you're building new AI experiences or just evolving your existing core product, go to statsig.com slash acquired to get started. Well Jason This has been like so fun. We gotta do this more often because it's it's incredibly fun to riff with you. I think this is a good place to call it for the the main show here. Um and for the LP show, I think we're gonna do is we're gonna dive into your investing, the the way that you're sort of, frankly, deconstructing the the jobs of a VC firm, sourcing, evaluating. you know, winning the deal, helping, and then future access to capital. It's really interesting what you're doing. And I also want to discuss the way that all these things tie together and how you sort of view the flywheel or the funnel or how you how you sort of visualize it. And then I know you've got some uh

1:36:51 Um good insider stories. Good insider stories for sure. The couple you brought up. And also like frankly, the way you see the world, um I I'm sure there's a hot take in there. I got a hot take post corona. Yeah. Yeah. Yeah. So Listeners, thank so much for going on the journey with us here. Um hundred bucks. Become an L P member like me. All right.

1:37:12 Uh listeners, thanks. L Ps will see you on the other side.

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