Jake Paul 与 The Chainsmokers：把名气变成资金、Jake 要进政坛？以及创投泡沫信号

How are you, dude? How are you doing?

Good.

1. From artists to investors: picking deals, playing the sixth man & what fame buys

Hey, don’t fall asleep. Jake, let’s start where I think Nick and Clavicular left off, which is weird in a way. You all grew up in this social media generation, and maybe you were at the beginning of it. You’re almost 30 now. Tell us about your journey, because it started out very similarly to the journey of a lot of people. You found Vine at the time, so it wasn’t even TikTok or YouTube, and then that success begets success. Tell us what that does to you as an individual trying to find your way in the world.

That’s a good question. I don’t remember a time when I didn’t have followers—people following me and reaching out to me from a very young age. I think I was into it before it was cool because it was my passion.

A lot of people are trying to become influencers right now, trying to figure out if they can go viral, build a team, and build a business around themselves because it’s cool and seems like the best option. But I think the people who are truly entertaining, have their own vision, and fill a niche in the entertainment industry, particularly on social media, are the ones who succeed. I did it because I liked doing it.

Did you enjoy doing this when you first started posting?

I loved having a story and an idea in my head, seeing it come to life, and being able to present it to the world—to make people laugh, change their lives, and maybe make their day a little better.

People go through hard times every day. If I could inspire someone with my messages every day in my vlogs, I would say, “Make sure you work hard. Make sure you smile. Make sure you chase your dreams.” I think those simple daily reminders are the reason I’ve been able to grow a really big audience.

Does pressure change your approach to business as you become more and more successful? There are millions of people following you, and then somehow the platform disappears beneath you. How did that change your approach when you thought, “Oh my God, I’m going to have to start all over again? This business, which I invested so much time in, no longer exists”? I’m specifically talking about Vine.

I wasn’t too worried about it. It’s actually a funny story, and it’s a good lesson for business owners. We said to the top 20 Vine users, “Hey, you have to start paying us, or we’ll stop posting here,” because they weren’t paying us and we knew we were being ripped off.

We collected all the content, all the views, and all the fans. We said, “Hey, we need $1 million.” They went back to Twitter and said, “They want $1 million.” Twitter responded, “Yes, we can pay you $1 million.”

$1 million each, or $1 million between them?

Exactly. They said, “We’ll pay you $1 million. How do you guys want to divide this between the 20 of you?” We said, “No, we need $1 million each, per year.” They said no.

We all stopped posting on the platform and moved to Facebook, YouTube, and Snapchat. Within a few months, Vine disappeared.

Tell us about the evolution of streaming, popularity, and attention. How has it changed since you started 15 years ago? What do you think is happening to society and to these generations of young men and women who are now striving to be famous and have what you’ve created, which we’ll talk about in a second? What happens to these people sociologically?

It’s a strange world to grow up in, and I don’t think we have the answer for how a generation of kids is growing up with iPads and access to so many more things than we ever had.

I was still in the era when I had to knock on the door of my friend’s house to talk to him. I had technology, but I also had an analog real life. I have that balance, but I don’t know what it looks like for kids today.

There’s a lot of not-so-good streaming content out there, and people are doing things for clickbait, views, and attention. I did it when I was a kid because I wanted to be successful, build a business, and build an audience. That’s why I call it “YouTuber disease,” which people can often fall into. They just say absurd things to generate more press and clicks every day.

Should YouTube take more responsibility for filtering some of this content and have a more, perhaps, moral view on what range of things it should support?

I think it’s just one platform. The problem is very similar to the artificial-intelligence race going on between the United States, Russia, and China. If YouTube stops this, its audience and the number of people visiting the platform will decrease. Then Twitch, Kick, Twitter, Instagram, TikTok, or whatever platform is still growing will take that audience.

If they don’t come together to solve the problem, I don’t think the problem will be solved.

2. Turning an audience into businesses, the boxing playbook & coming for the UFC

You had to evolve from creating content into becoming a very successful businessman. The evolution of content creators is typically that you move from being a content creator into sponsorships, maybe start releasing your own products, and then, ideally, if there’s cash flow, you can start owning assets. Tell us your version of how it happened for you.

I’m an entrepreneur at heart. Even before I became famous on YouTube, I went to San Francisco and the Valley and fell in love with startups. After seeing all these big companies, I was able to visit Google, Twitter, and Uber. I saw people at hacker houses building all these crazy apps, and that’s when I started angel investing and my own startup, which was a social-media label at the time.

I always saw vision and potential in people. I found talent, signed them to my company, Team 10, and helped them grow. I created 20 or more people with millions of followers and revolutionized it as a content house. That was my first startup.

I’ve always been in the startup business, investing and being in the Valley since I was a kid.

One of the things that happened at some point was that you started boxing. You had this incredible moment with Mike Tyson. I think it was watched by 108 million people.

138 million people watched on Netflix.

Where did boxing come from, and why did you feel like you had to risk your body? Was it because you were passionate about the sport, or because you felt it was an untapped way to continue raising awareness and attention?

It all started with these 2 brothers from the UK talking to me and my brother. We said, “Let’s just put on gloves and get this thing sorted out.” I signed a contract to fight with them about 3 months later. I said, “I won’t lose.”

The next day, I went to a professional boxing gym. It was very exhausting, but I grew up as an athlete in Ohio and just started training. During that 3-month period, I became pretty good. I went to Manchester to fight him in enemy territory and got knocked out.

It was one of the best feelings of my life. It was very accomplishing, and it was a lot of fun. I don’t know if this is a bit sadistic, but it was cool—getting punched in the face and beating someone up.

From that point on, it became the biggest pay-per-view in amateur boxing history. I saw the numbers, I liked it, and I wanted to double down and become a professional boxer. I took it very seriously.

I moved from Los Angeles to train in a secluded place in Puerto Rico, where there were fewer distractions. I knew I could take on boxing, and I saw the potential because most boxers build their records. They fight lesser opponents, and then suddenly you first hear about a boxer when he’s 20 years old.

I built an audience of 100 million followers who followed every fight. I was also able to develop and create fighters under my leadership, similar to my initial group of Team 10 influencers. I replicated that model, and now we have 400 fighters boxing and competing in MMA under MVP. We’re after Dana White, Super Boxing, and the UFC.

Tell us about it. Where is the UFC failing? Why is there an opportunity to revive MMA?

First of all, they don’t put the fighters first. They pay their fighters approximately 15% of their total income, while in other professional sports leagues it’s 50%. That’s why the fighters are angry. They want to leave, they want to box, and they want to find and make money somewhere else.

Sean O’Malley received $600,000 on a White House card. That’s why big fights don’t happen. They’re not willing to pay for big fights, and people don’t want to take risks. They don’t put on the fights that fans want to see. They’re having trouble creating a classic opportunity that would benefit them.

That’s right. You attract talent because you’re willing to give them a very significant portion of the profits, revenue shares, and all that.

That's right, you allow them to receive sponsorship and don't put it off until later. There is a lot of drama between the fighters, and many of them also want to move into boxing. In every industry, there's Coca-Cola, Pepsi, Nike, and Adidas, and there had never been an opportunity to compete with the UFC before my company joined and we merged with the PFL. It's going to be very exciting for the next few years.

3. Attention as capital, investing without the celebrity label & why politics is next

How and when did you start angel investing? You're an investor in OpenAI, Cognition, and SpaceX. This is an incredible portfolio. How did it start?

I started angel investing when I was 18, after going to the Valley, making a bunch of mistakes, and then formalizing the fund.

Is Jeff your partner?

Yes, Jeff Wu.

Jeff Wu. We think we live in an attention economy, and capital is a commodity. I think that's part of why Elon is buying Twitter. When you create a new Twitter account, the first suggested follower is Elon. He's very smart about promoting all of his companies, obviously, but bringing attention to the company and the capitalization table is something we find extremely valuable and something that founders need and want.

Jake, what is the downside of the attention economy? For example, what is the disadvantage when popularity is how things are initially resolved by arbitration?

Yeah, no, I think the problem is that people forget about creating great things and focus only on creating something to attract attention and interest and give the impression that they are doing something grand. That's where the downside can be, and I think the insincerity that can come with trying to get views is a huge problem that I see in journalism, reporting, and among people who create content online.

Often, people come up with these crazy hot ideas because they know it will get a lot of views and make them money. Ultimately, they use this attention to try to make money. I think money rules the world.

So, in the attention economy, this insincerity comes out, and it's not a good mechanism for earning your attention. The number of followers and the reach that you have are distinguishing features when you invest in these businesses at a certain level, because with some of these businesses, you can help them break through the noise and create a level of awareness that they wouldn't otherwise get.

Right, but my years of experience in marketing and branding behind the scenes also help with a lot of this. Specifically, with OpenAI's Sora, I was the one who said to them, “Hey, this might be a good idea for you to start a social media app.” We were involved in the entire process of creating the app.

So, really?

Oh, yeah. Then they gave them their NIL, so people could make videos with it.

Name, image, likeness.

Yes.

You just raised $100 million for this fund. You call it Anti Fund. Are you going to compete more aggressively with traditional venture capitalists, or do you want to be a complement? How do you see this developing?

No, that's what I hate about this whole celebrity venture capitalist thing. It's just annoying. For example, if a lawyer is an investor, he is not called an investment lawyer.

Of course.

So, I'm like a celebrity, but they call me a famous investor. It's something like, “No. Compare me to the Sequoias of the world, our DPI and IRR, and let's see who performs better over the next 5 years.” These are the people I want to compete with.

We are extremely ambitious, and this is our ambition and direction of travel. I'm ruthless here. We're multi-stage and multi-sector, or we invest wherever we see fit, with a barbell approach.

We've already raised this fund. We simultaneously raise and deploy funds, so we're funding 4 right now. We have a barbell approach: first, onboarding and helping founders build their companies from scratch and identifying talent, or transitioning to the growth stage with companies that have a proven track record—the best founders in the world, from the Sams of the world to the Palmers of the world, and so on. That's why we diversify on both sides.

There is a natural evolution with age, meaning that what you used to do stops working, or you just have to stop. For example, you can't do boxing forever, but you were very creative in getting to the next level.

As we wrap up, tell us how you see the next 10 or 15 years. Give us a sense of media, fame, attention, and business opportunities. How do you organize Jake Paul Industries?

I think it's a flywheel that feeds itself. When I fight, it draws attention to all my other businesses, and when I invest, it develops my business brand. It's something I'm extremely passionate about and something I'll do forever.

When I create content, it also helps me grow my following and direct people to fights. Then I can promote my business and help more people. I have a foundation where we opened 40 gyms for kids so they can box for free, sending kids to boxing events and tournaments and sponsoring them. It is this flywheel and ecosystem that fuels the entire empire and fully develops it.

Where, finally, is 40-year-old Jake Paul? Where do you see him?

I think in politics.

This is a great answer. Why?

I believe that the best way to change the world is through politics. I've already done and achieved so much, and the greatest satisfaction I get is from helping people. Now I'm doing that in women's boxing and with young boxers, giving them a pedestal and the biggest paydays of their careers.

We completely revolutionized women's boxing and actually made it the WMBA. Before that, they were underpaid, poorly served, and they hardly participated in any fights. I get the most satisfaction from doing this and from the gratitude that I see from them.

I think the next step for me is to help the world. I think the best way to do that is through some form of politics and actually being on the ground floor and making change. I believe that future people in power will have a natural, built-in audience that they can communicate with.

I've been saying this for 5 years now, and then recently Spencer Pratt came along. That's the first example of someone who is—

Or Trump was probably the first, yeah. But even he isn't like that. He didn't have that kind of native audience on social media where he creates content. He was a traditional celebrity.

I think even the Nick Shirleys of the world—Nick has to be in power and do something at some point. These are the future leaders of the next generation, who will have this built-in audience and be able to get votes.

Jake Paul, thank you very much. Bravo.

Thank you, brother.

Yes, that was great. Who are you speaking for? There is no one here. You have to imagine this, my friend. You must fulfill your destiny. If you don't imagine your success, you will never achieve it.

Their music went platinum 25 times. That's The Chainsmokers to my right, Alex and Drew. They are one of the biggest DJ groups in the world.

You shared a quote when you founded MANTIS: “You know it's the end of the day for venture capitalists when The Chainsmokers start doing it.” Music for venture capital is a completely different game. Do you have the legal right to say, “Invest in MANTIS”?

I can invest in you.

How are you, friend? Nice to see you.

Nice to see you, brother. How are you, brother?

Nice to see you.

How are you, brother? Nice to see you.

Dude, last time I saw you guys, Friedberg and I were in the pit lane at 1:00 a.m. They danced like bears. You guys threw it down, and we were amazed. I didn't expect you guys to stay. I'm there until sunrise. When you guys stop playing, I'll have another 20 minutes. I'm fine.

4. Drew Taggart & Alex Pall join the Besties!

Friedberg was high as a kite. Someone gave him a pill and a beer. He just drank this little thing and was dancing like a fool. I'm kidding. I like the pre-party. The pre-party is more my scene—a little quieter.

Oh, that was another great part. You walk into your VIP suite at The Chainsmokers. They have a suite, and you walk in and there's something like 50 guys there, along with all these famous people. Then they walk you through a tunnel with The Chainsmokers. Boom. Then 10,000 people in Vegas lose their minds.

How long have you been doing this? What do they call it? A residency?

Residency. We've been at the Wynn in Vegas for 8 years. We've been in Vegas for 10 years now, and I think we're going to die there if we stay relevant.

Personally, I wouldn't be buried at EBC. I like Beachclub better.

Wynn—your album. This is your main album in your collection.

That's right. That's right.

Can you guys talk about your evolution in making music? How did you find each other? How did you first figure out what genre of music would work? Then, that first little burst of success—what did it feel like? What did you think would happen?

Probably not that, but just like that.

We met through something like a mutual friend, I think. Strangely enough, we didn't know each other at all before. Alex started The Chainsmokers with another guy, and they had a falling-out. He was like, “Okay, we put so much work into this. We DJ at all these shows around New York. It was around 2011 or 2012.”

I was in school in Syracuse and was just graduating around that time. Alex said, “I want to find someone. You know, The Chainsmokers are two people. I need one more person.” I was just doing music in school, and we met. Strangely enough, I didn't realize at the time that it was the most important decision of our lives.

Essentially, we met and said, “You seem cool. Let’s form a band.” And here we are, 14 years later, still best friends. We’ve had a lot of success in music, fortunately, and we’re so like-minded in so many other areas. It’s the happiest thing that’s ever happened to me.

Is it difficult to create new music and feel like you’re breaking new ground when maybe a lot of people want to hear the classics, so to speak, or have a certain idea of what your music should sound like?

We were just talking about this earlier. I think one side of the equation is that there’s a sound we’ve created, and people are used to hearing it from us. We love creating it, and then you see one troll on Twitter say, “You guys keep making the same song over and over again.” Suddenly, you say, “I’ll show you,” and you step away from that a little bit.

I don’t think one Twitter troll is responsible for the origin of our music, but I think we like to challenge ourselves. More than anything, we follow our creativity and where it goes. We don’t have a clear label for what type of music we think we’re making.

I also think that, oddly enough, there’s a big desire for nostalgia in general right now. We found ourselves in an interesting position where there was a big trend in January 2016, which was a pretty special year for our career. Now we’re in 2026, coming to the end of the year, and we’re wondering where to find the balance between what makes our music interesting to make and perform and harnessing this particular feeling.

Why do you think there’s this need for nostalgia? It’s funny that you say that because I listen to my kids’ Spotify playlist. They’re teenagers, and there’s so much retro-style music. They listen to Elton John. They go back to the past, and I wonder why this is happening.

It’s hard to say for sure. It probably varies from person to person, but I think everyone remembers the past more positively than the present. They want to exist existentially in a time they can color with their own memories. Maybe there’s a simplicity to it—just saying that the music was better back then.

Yes. I think that—well, tell us about the music business, and then we’ll talk about the business of business.

Of course.

You guys did an incredible job of reimagining it. You just need a crazy idea—you need to start something of your own, get the first thing to work, and turn it into a real business, and you did that. Explain the business of your business before you say, “I’m going to be too negative about the music business.”

I can be positive.

Yes. Good. You do it.

Okay, I’ll be positive first. The music business is an extremely competitive environment. Now, 300,000 songs are uploaded to Spotify every day. Unlimited content.

100,000 per day?

That’s right.

Wow.

When we started in 2012, things were different. This was pre-streaming, and if we were to start all over again today, I have no idea how we would do it.

In 2012, when we were just starting out in dance music as producers and songwriters, we started doing remixes. We liked indie electronic music. There was a chart called Hype Machine, which was the first viral chart on the internet. This was long before streaming.

Basically, the algorithm was based on how many blogs posted about you and how many likes you got on that chart. We reached out to all these artists because we liked the music being released on the chart and begged them to let us do remixes.

Alex would go into the Hype Machine backend and find every person who wrote for every blog and where they got their music from. We would remix a song that they had already written about, and then he would write them these funny, highly personalized emails telling them where they went to school.

He realized that all these kids—students—wanted to be closer to artists, while all these labels were sending out boring promotional emails. It wasn’t inspiring, so they were very receptive to Alex’s messages.

We went from being almost completely unknown in the first year of our career to having about 30 No. 1s on the site because we remixed the right things. Within the first year of our career, Alex developed probably the most powerful promotional platform, probably bigger than any other label at the time.

It’s content marketing. It’s like you guys. That was your energy back then. It seems like that doesn’t apply now. Maybe it’s TikTok. I don’t know what it would be if we had to start from that point, but that was our first thing because we were learning to become good producers and songwriters and find our artistic identity.

I like that. It also seems a little bit broken when I think about what the music model is right now, and I think there are a lot of parallels between what’s happening in the venture business and what’s happening on the label side. There are more channels now for distribution than ever before, as well as for building your own audience, reaching your fans directly, and building your own community.

I’m honestly really curious to see who will be the first brand-new artist to throw away all the typical things an artist does, like signing a contract with a label and signing for the next 5 albums.

I think we’re already on the verge of that, but there’s this vicious circle that arises in music where it’s so hard to break through. When you finally break through, you find yourself in a position where you’re probably being offered the first few million dollars you’ve ever earned in your life for something you’ve put your heart and soul into.

You also think about all the people you’ve admired throughout your life, and they’ve usually all signed with record labels. That’s the moment when you decide to really bet on yourself and go it alone in every sense of the word, or choose a slightly safer path but, in the process, sell part of yourself and your future to a label model.

Labels still provide a lot of value, I think, in different roles, but it’s a whole new world now. I don’t think anyone has any idea what’s going to happen next, especially with artificial intelligence, music, streaming, YouTube, and all these other platforms. People’s attention spans are getting shorter and shorter. It’s a crazy time right now—very exciting, but also very different from the period of music we started in many years ago.

In this musical side of your life, you perform live a lot. Is that what generates most of the revenue? Is the business today really about live performances, not digital? Once you get there and have an audience, doesn’t that just keep feeding itself?

For us, it does. It depends on what kind of tours you do. We have songs that we perform, and sometimes we have a whole band and tour in an arena, where the expenses are crazy. Luckily for us, we emerged in dance music. We were DJs before we were anything else, and that’s a big part of our touring business. The economics are much better there. So, for us, it does.

Can we talk about the transition into investing—how you got started and how that part of your life helped you make that transition?

Drew kind of touched on that. I think we’ve always had a very positive relationship with technology in general. We’ve used it in very smart ways throughout our careers, like growth hacking, which Drew talked about.

Our friend James created a kind of conferencing technology called Tilt, which we used to transfer tour data. This was before the advent of cloud technologies, before all the backend data that was available to us—or is available to us now.

I think that established some positive relationships, and honestly, our path into the venture business was about as cliché as it gets. We were lucky to become successful artists. We had a distribution and marketing platform through The Chainsmokers, and in that way, we were kind of catnip for consumer brands.

It was an interesting and exciting time for us to start investing, but what really struck us and resonated with us was the relationship with the founders and the ability to add value to the business. That’s what really caught us off guard. Instead of treating this as a passive-income opportunity, we wanted to be practical and take matters into our own hands.

I also love creative people. It’s great to have this career in music, but there’s something inspiring about working with an entrepreneur who puts everything on the line and works around the clock toward a big goal.

I won’t lie: More water companies are not what the world needs. We met these great founders like Brian Chesky, Drew Houston, Michael Seibel, and the Kahn brothers. You have to ask yourself what you want to spend your time and money on. Most things probably won’t work. At the very least, let’s invest in things we think are truly interesting and that can have a positive impact on the world.

I remember personally being invested in a Series G of Uber or something, in the final round. I thought I was the smartest and coolest person for having done it.

I mean, I made about $25 today on that investment, but to me, it was exactly what we wanted to be a part of in the future. And I think that's led us to institutionalize our access, become really great partners for companies in cybersecurity, artificial intelligence, infrastructure, deep tech, and take it incredibly seriously.

How did you learn to evaluate your selection process? These kinds of things come in, and you haven't seen a cybersecurity company before. I assume that's when you first saw it.

Yes.

Do you know how to start making this choice?

Yes. On certain levels, that was the main issue. We definitely had an interest here. I think the most important thing was that we show up and be good partners. I'm not going to do the traditional song and dance to get what we want and then disappear into the fray. But I also agree that we didn't have a very clear understanding of what a cybersecurity company needed.

I think what was interesting was that, after talking to a lot of the founders we've been fortunate enough to build relationships with, it felt like the things that kept them up at night and challenged them as they built their modern businesses in today's world were a lot of things that we had a lot of experience with.

By that I mean, we make music pretty much the same way we did 15 years ago. But like everything else in this business, it has completely changed in terms of how we distribute it, build community, sell it, tour it, and so on. And I think as you build a company, obviously you still care about revenue, maintaining the bottom line, customer acquisition costs, cost of goods sold, all of that. But the input data with which you create them is different.

It felt like there was an opportunity to build a different, differentiated type of firm that didn't necessarily have to be a replacement for Craft or Sequoia or anyone else, but to be a collaborative partner. For lack of a better term, it's about understanding our role in the ecosystem.

Can you break down what a firm looks like, then?

Me, Jeff, Drew, and Milan founded it. We have some great partners, and at Grove, we specialize, or focus at least, on cybersecurity, artificial intelligence, infrastructure, deep tech, and medical technology. We invest in companies at the early stage and Series A stages. We are not in a lead position. We love being the sixth player of the year on these teams.

It's kind of like me thinking of myself as Robert Horry. Robert Horry has a bunch of championship rings, and you can be really successful without having to be Shaquille O'Neal on every team. I think we've learned a lot from working with great firms, and we've also learned a lot from working with great founders. Going back to your question, the whole point is to start building that strength and pattern recognition of what greatness looks like.

What are these firms doing to support these founders?

I think we all exaggerate what everyone actually does for these companies. I was surprised when I got an email asking, “Hey, is there any way I can talk to him on the phone with this person?” And he replied, “Indeed, yes. We played at their corporate party 3 days ago. That's not a problem.”

We've been extremely helpful when it comes to go-to-market relationships, brand, and the brand-building aspect, which I think has become very important these days because of the security that artificial intelligence has created around technology. You really need to suck up the oxygen.

You guys are just extraordinary entrepreneurs. Making a business work in the music industry is one of the hardest things you could ever do. This is much more complicated than building software. So I think you have a lot of trust, market access, and the ability to support people through networking, while also knowing when to get out of the way.

Great founders very rarely need help. When they do need something, like networking or understanding the business model, we actually have very good connections to do that.

Deal flow is the most difficult part of a venture capitalist's job. We're lucky to have this podcast; it gives us the opportunity to get a lot of deal flow. And you're lucky in the fact that you guys are very well respected in your industry. A lot of the people who are founders probably came to see you perform and maybe played your music.

I think that's absolutely fair. For people who are interested in this, you have to do the work. It's very easy to fool a venture capitalist, but it's hard work to be an outsider. It seems like this is the best position.

I don't think I would bet against us, and I don't think it would work out for anyone. But keep letting us underestimate us. I'm happy to be in this position, but we like hard work. We love to show up. It has always been in our DNA.

This is an incredible opportunity for us. I studied art history at New York University. It seems incredible to me to be in this position, to be doing any of this. So we don't take it for granted. These things are people's life's work, and you get to play shows all over the world for our fans and see what our music means to people. This is the most enjoyable thing I can imagine in my life.

You know, technology is getting bigger and bigger. I noticed a huge amount of curiosity from people in Hollywood. I don't just mean the music business, but also acting and agencies. Everyone wants to do it in some way.

5. Advice for famous investors, whether fame helps or hurts & the non-obvious bets

You guys invested in a bunch of unicorns. You have a phenomenal track record of companies you've been in. This is very impressive. I'm wondering what advice you would give to someone in Hollywood who has a huge following, is very famous, and could get financing and a deal based on their name alone, but has no idea how to do it. What would you advise them to do?

I would ask them if they had paid off the mortgage first. If they did all that, I would say that venture capital is probably the last place to start investing, in my opinion, because these are generally long-term, illiquid assets.

The venture business is also extremely complex. You're talking about extremely complex power laws. Yesterday, in our chat, we were looking at a chart showing, for example, that the 5 leaders generate 90% of the profit. You just need to work for the best companies.

It's brutally hard to succeed in any of these things, whether it's sports, Hollywood, music, or venture capital. You should approach this the same way. We dedicate all our time to this. We work around the clock.

We've seen a lot of people asking us, “We want to get into the venture business.” Usually, when we meet with them and their teams, they don't show up to the call. I don't think people realize how much work it is. Every deal we made personally, every deal we had to get involved in, created a lot of noise. You need to sift through it to find people who want to do it.

I really think the idea of venture business is extremely exciting, but what it takes is extremely difficult.

Does your fame help, hurt, or is it neutral?

I think it's both, to be honest. Obviously, there are opportunities to connect with people who probably would be harder to reach. I'm constantly on LinkedIn, using my nickname and connecting with people I want to talk to.

But then, obviously, there's also the fundraising side, where you're talking to the director of an educational institution, and he just says, “Look, I like what you're doing, but I'm not going to invest in the Chainsmokers fund because you're going to be the first person I point to if something goes wrong.”

I understand that, and I think up to that point, you have to be compassionate. We've always been results-oriented guys, so everything is fine. I'll be back next fund with numbers that will make you regret this decision, and we'll try again.

I think you're saying something incredibly powerful. If I've learned anything in this chapter of my life as an investor, it's that the ability to generate consistent DPI cuts through all the noise, whether people have a problem with you or not.

People have had issues with me, but undeniable profitability and the ability to convert any of your assets—attention, fame, track record, technical expertise, whatever—into results really speaks for itself. That's one thing that I think investors have a very good tendency to do: they have an extremely short memory for everything except profitability.

Yes. And I think that's one of the things. We're still relatively new. It's been 7–12 years since our first hit and 7 years since the fund was launched, and I still feel like a newbie in this field.

I feel like the hardest thing right now, and I'm sure you've discussed this ad nauseam here, is that there's so much liquidity going into everything right now. It's not just about backing a company that you know is going to be on the rise because of the people involved in it.

I think that's the hardest part, but also the responsibility of being a good manager, which is to invest in ideas, founders, and businesses that seem real and tangible, as opposed to the hype side of the venture business, which is very relevant.

You can honestly go out here and invest in tons of companies where you know it's just going to be on the rise, but I don't see a long-term vision of where that company is going.

And I think that's a challenge for someone who—yeah, I like those results, the ones that TVPI always looks great on—but is actually betting on a bigger idea or vision. Well, obviously, Airbnb at the time and Uber, when you did it, Jason, were non-obvious decisions.

Regarding your point, I introduced Travis to 21 business angels, and 19 said no. Three said yes: me, Cyan Banister, and First Round Capital.

Why do you think they said no?

I can tell you the reasons. They said, “Well, it’s a dirty business in the real world. We don’t want to be involved in this. We invest in software development companies. If he just sells the software to taxi companies, we’ll support him. But we don’t want to be in this dirty business in the real world, because someone could get hit by an Uber and die, and then we’d be responsible for it. It’s just too complicated. It’s too dirty.”

And Robinhood was the same. They looked at Robinhood and laughed at that company. We were in that company before they left.

I remember when this company was raising its seed capital. The Series A was a complete joke. People said it was the stupidest thing. This was a huge mistake.

I’ll tell you what I did wrong at Robinhood: it was purely my own ego. They had a sign-up list of several million people, and one of our directors was very insistent that we invest in this business. What I couldn’t get over was my previous experience at Facebook and how I helped design its growth engine. It broke too many previous rules for me, and I just couldn’t get over it. When you look at it, it’s a billion-dollar mistake, which is terrible.

By the way, I really resonate with this. We don’t invest in any music apps or anything related to music, because it’s very hard for me not to be pessimistic about those opportunities. I think you have to be—I don’t want to call it blind optimism, but pragmatic. Any investment that you've made where you've lost money, never invest in that area again. This is so common. Or, if you succeed, it's just too close. Like, we're going to get rid of the manager, and you're like, "What? "No chance." I, you know, go through things like that... The only thing that can overcome all these prejudices is understanding how capable this person is, how complex and focused they are. That’s the foundation. When I met Vlad and his partner, they said, “We’re going to get millennials into investing, and we’re going to do it because they’re going to invest for free.” All I could think to myself was, these guys are extraordinary. They’re so smart, they’re quants, and now they’re going to build this app. What if it worked?

That’s a tough question: to stop for a second and say, “If this works, what would the world look like?” Here we are, over 10 years into Robinhood. I have never sold any stock. In fact, I bought a lot of stock when it was around $9 a share on the public market.

Haven’t you sold yet?

No shares have been sold yet. I sold a lot of Uber over the years because, at one point, it was 99% of my net worth and I had no choice but to do it. But I still own a lot.

Robinhood is a very special company because now you have 2 generations of people working on it. Vlad continues to launch the next vertical, and the next vertical, until he stops running the company and loses his vision for the product and its execution. These things cannot be faked. Execution cannot be faked.

There’s an interesting observation. I’m not sure if it’s true or not, but when you look at the big investors in a particular asset class, it usually turns out that they have no history in that asset class. Mike Moritz was a journalist, right? John Doerr sold Intel chips. Look at the fortunes they made on the internet. They had no past.

If you look at this next generation of super investors, there’s something about being far removed from the industry.

Yeah, but having that curiosity, the ability to network, and the ability to think critically about a problem—I think that’s very valuable.

When I’m choosing venture funds that I want to invest in, I have these 4 Ds: deal flow, which you guys have; decision-making, where you’re very sharp and insightful in terms of your own career; doubling, or when to double the investment; and distributing, or when to sell the shares.

You’re at that stage now if you’re in year 10. What do you think about doubling the investment or not? And how do you think about distributing—about selling too early, which is actually the reason for your success in this business in some cases?

That’s a really good question. We’re approaching our 7th year. We just had one of our first truly liquid events with the number one fund company.

And now, congratulations to Underdog Fantasy.

Underdog Fantasy.

What a company. What an incredible feeling.

An incredible feeling. We think about it a lot because I think we’ve created 75% of the business model, but we really need to return the money to investors. Otherwise, none of this really matters in the end.

6. Riding winners, getting cash back to investors & spotting bubble behavior

I think a lot about the profile of the people, especially early on, in the number one funds and the number two funds who invested in us. They’re not here, in general, to play it safe with us. So I think we have a little more freedom to wait for the winners.

You have to be really involved in these companies. Dandy is in the fund on its own, which is an amazing company that continues to double every year and has just started international expansion. You think, “I’m going to ride this until the wheels fall off.”

But in the context of where AI is today, all the capital that’s coming into it, and all the external conversations around it, I wake up every day and think, “You could probably build a business model to get into a highly competitive Series A, add value, and just exit in Series B or C.” That’s your guaranteed role.

That’s not what we do, but it’s important to pay attention to these signals. I actually think there are a few companies in our portfolio that I won’t name where it’s interesting to watch the demand before the round, then the price is set, and then the atmosphere around that company at that new price. Either demand increases again, or it remains at the same level. It’s very interesting to pay attention to those supply-and-demand signals.

Obviously, the secondary market sends emails every day, offering opportunities to get liquidity. But I think that’s where you need to spend a lot of time underwriting and trying to really understand the potential of these businesses.

As for the next part, it all comes down to focusing on your winners. I think it’s a skill that takes time to master, and experience gives you the courage to understand what they are.

I want to thank Brian Singerman for once lecturing me for about 2 hours about the importance of follow-on work. I think we’ve gotten better.

You can count this toward your fund.

The Founders Fund, I think, is brilliant for a lot of reasons. First of all, they make you find someone who’s in the portfolio and say, “Great, we’re going to put 25% of the capital into each fund. Every fund. You must find that company.”

That’s incredibly scary if you have to sit here and sign your deal, your other partner’s deal, and tear up everything else. It’s literally like saying, “I’m going all in on this Founders Fund.” I’m actually going to become an employee of this company for the next 3 months and find a way to get leverage to convince them to put up a check size that we haven’t traditionally had a lot of experience with in the past.

But when I look back, the signals were always there. I always knew what we should have done. We’re just taking steps, one by one, to get to a point where you have the courage and understand the subtle signals around these things that make the right decision obvious.

Have you thought about starting a growth fund? Some people do it this way, having a pool of capital where they can invest a lot of capital instead of concentrating it in the main fund.

Yes, we discuss this all the time. We’re growing into the idea of a growth fund.

Another elegant option is an SPV, and I can trade ideas with you on that. It’s worked quite elegantly for us. One of the things that’s starting to happen, which you’ll soon find, is that if you do the job right, you’ll be curating a group of LPs.

We have a number of family offices that want to work at a late stage, so they’re very interested in the Zipline deal, the Vast deal, and the Atoms deal that we did. Then we have early-stage investors. We had a company that took off, go.ai, and we had early-stage investors who invested less than $10 million and needed liquidity. Some liquidity was available, and we were set up with modest sellers.

Then we had so many late-stage funds wanting to buy it. We also bought in the last round for $500–$600 million.

Sequoia is going through this right now, as is Founders Fund. They buy and invest in companies, whether it’s Stripe or SpaceX, and they also sell at the same time. Because companies stay private for so long, you can actually combine both of these parts of the business into one.

I think that's where the venture business is: you can have a very good late-stage business with just the top 10 people. I'm amazed at the size and scale of these companies now. I mean, hearing the word “billion” even 12 or 10 years ago was like—you'd be like, “Lick the sidewalk and I'll give you a billion dollars?” It was such an irrational number.

And now it's a billion in revenue. I think being a unicorn should really be reimagined—not based on valuation, but based on revenue. I believe that unicorns are billions in revenue. I don't care about paper value anymore.

I want to see it. We have one company that just hit 700 million in revenue. I'm like, “Okay, million more and you'll be a unicorn.” And I mean, that's the understanding that's really important, going back to the secondary question and when you get out. Because at the end of the day, it's just another transaction. Sometimes you just pass packets in cases like that.

And these double- and triple-tranche deals that are happening now, I honestly completely understand from a Sequoia, Benchmark, Index, and Kleiner perspective, because, “I don't think their cost of capital is necessarily the same as everyone else's.” But, for example, the guy who invests in the second tranche pays a significant premium—sometimes 2 or 3 times the company's initial valuation—with absolutely no change in underlying performance.

These are bubbles. By the way, this is the behavior of a bubble market. When you see that, that's when you take some money.

As we wrap up, maybe one last question. Are you guys still working? Are you still working from time to time?

For you guys? Yes.

Well, yes, we'll make an exception, and so on. What are you guys doing tonight? Do you have any plans for tonight?

We'll come in.

Do you have a flash drive with you? Tell us where we're going. I wrote to you that I wanted tequila for you. This will be great. We'll drink a bottle of tequila. I want to try it. I haven't tried your tequila yet. Is it delicious?

Friedberg is going to take it apart on the dance floor tonight, so be careful, everyone.

What you guys have done is truly impressive.

Yes, thank you for inviting us.

Well done, gentlemen. It's the same pattern over and over again: if you have some attention and fame, develop some skill, and then you have to turn it into something.

I think I'll end this here. Celebrities are so good at saying, “Oh, that's brilliant,” and, “I'm excited about that.” But after 3 months, that shine wears off, and all you're left with is the real hard work it takes to succeed.

And I think that's always been our difference: work. We don't really care about the first 3 months. Do the work. You will achieve overnight success in 15 years.

Let's go. Yes. Okay, thank you guys.

Do you want to change?

Yes, we'll be here in a couple of hours.

Yes, very good.