Tyler Cowen

Hey everyone, this is Erik Torenberg and you're listening to Execs by On Deck. Execs is a show for founders, operators, and leaders who want to understand the playbooks, frameworks, and tactics that leading tech companies today have used to scale. Our guests are tech execs in key roles at top tech companies who share their hard-won, earned secrets on how to scale faster. Tyler Cowen is an economist who needs no introduction. His latest book, Talent, is available now. In this episode, Tyler talks about how to identify and cultivate talent. We discuss frameworks for assessing stamina, identifying late bloomers, and how to organize the world's ambition. Tyler, your latest book is on talent. You're almost up to a bit over 15 books now. If you were to tie a thread between the books that you've written, where do you put this book, both looking back and then also looking forward to the books you're going to write?

Well, first of all, it's a co-authored book and it's only my second co-authored book. That automatically makes it very different. Daniel Gross is a force of nature, just brimming over with ideas. And so half the book is mine and half the book is his. But I thought it was, you know, one part of my mission in life was to transmit Daniel Gross to a broader audience. And you can't say that about any of my other books. But it's also a book more based on experience. now being 60 years old, in a way that none of my other books are. They're based on years of research or learning, but not on my direct personal experience. So a very special book for me.

I know this book was inspired by your friendship with Daniel, but tell us about the moment when you realized that you had to write this book.

He and I were having lunch in San Francisco at a Chinese restaurant, and we just started talking, and somehow we both hit on this idea more or less at the same time. And it was mentioned, and in the first 3 seconds, it's one of these, we'll think about this for a few weeks and come back to it. But by the end of the sentences, you both know you're going to do it.

Yeah. One of the things you're hoping to do with this book, it seems, is a bit of field building on talent and talent identification, talent cultivation. You mentioned in one podcast that could be a future book. A few years ago, you released an Atlantic article with Patrick Collison, another talent you've helped transmit his ideas. around progress studies, and that was also a bit of field building as well. How do you compare the field building that you're trying to do here at Talent with the field building you're trying to do with progress studies?

Well, I think they're very much the same thing, almost literally. And I would point out Patrick and Daniel are very good friends, and I met Daniel in part through Patrick. So it's not a surprise there are those connections. And I think one of my strengths is as a synthesizer. So to work with other people and put something into a form for the world is something I'm good at and should do more of and will.

Yeah. And how about the field of talent in general? You know, if we're 5 years from now, 10 years from now, very happy about the field that has been built, what else needs to be explored? Like, what is your book in terms of this broader field? And what is your sort of request for research or knowledge or writing on it?

Well, I think virtually everything needs to be done. There are remarkably few scientific papers that look at, say, the venture capitalist process because that's proprietary information, right? And figure out, you know, what in an interview predicted later success of the project. We just basically don't know even some very fundamental things, even what to index across in an interview. But there is this thing of Silicon Valley lore. which I learned in part from Peter Thiel, Sam Altman, Marc Andreessen, also, you know, you and Ben Kosnoka, other people. And I thought at the very least to write that down and integrate it with scholarly literature and just give people a framework for thinking about categories, developing ideas of their own, that was a kind of imperative.

And how cross-cultural do you feel that lore is, or cross-industry? You know, one maybe obvious point would be that in Silicon Valley, you're looking for more outliers because the business model prefers people who are— or encourages people to take more risk, whereas in other industries, perhaps you're interested in taking less risk. That's just one example of how things may be different. How across industry do you feel that the Silicon Valley way of evaluating talent applies?

I think it varies greatly by sector, but overall, the world is moving closer to a Silicon Valley perspective. Because in firms of many different kinds, first, they're just becoming more tech to begin with. But second, there's a greater realization that your best people are 10x or more times valuable than just your normal good people. And the more that's the case, it's not a matter of risk. You just need to work harder to find those 10x people.

You know, it's interesting. Daniel Gross, of course, non-college educated, you know, obviously very successful. In your other talks, you mentioned MrBeast. also, you know, in a different era perhaps would've had some normal job, but today is, you know, is immensely successful. There's a question as to how many of these people are truly out there who have not yet been discovered or cultivated in that way, and what is the mechanism by which we can identify and cultivate them?

Well, the internet has been improving this rapidly. So say very smart 15 or 16-year-olds, Even when they're not living nearby, they find each other. And I find this remarkable. But one simple thing we ought to do, which people are somewhat aware of but just not doing fully, is when you're evaluating talent, find out whom it is that the peers really respect and don't just ask the seniors. And that combined with the internet, I find, is extraordinarily powerful. And you couldn't quite say, well, no one knows that, no one's ever thought of that, but it's just a thing out there hovering where we don't have a massive social effort to mobilize that kind of approach.

Yeah, one of my dreams is for a kind of peer-to-peer endorsement platform where people can sort of almost speculate on their friends and say, hey, I bet this person is gonna have a big career in something and get rewarded either socially or even economically. But more importantly, it'll be sort of price discovery via talent. It's your idea of markets and everything. It'll be interesting to see if that emerges.

And in the short run, there's a kind of implicit reputational market that if someone recommends a good person to me or to you or to anyone else, or others, there is some reward that you're seen as an important part of the network. You might get funding more easily, favors be done for you.

Yes.

So there's a kind of barter market as it stands.

Yeah, but it's informal, implicit, and as a result, it's, you know, it's not as scalable. And, you know, we're always doing the same references over. There's a lot of redundancy, and there's questions, there's reasons why it's a little weird if it becomes explicit. But angel investing serves as this in some capacity. It'll be interesting to see if there's more social capital investing.

Yes.

One of the things that you identify is that ages 14 to 19 is an underexplored intervention area where you can come in and show people different role models or raise their aspirations. I'm curious how you've thought about the emergent ventures that you run in terms of what age makes sense to get involved in your program and And why not go younger?

I worry if you go younger, you're just selecting for people whose parents told them to do this. And that for me is actually a negative, even though those kids tend to be smart and hardworking. If the parents are pushing it, I get very suspicious. And there's an ethical issue, like when is a kid old enough to make a decision that he or she should take a fellowship? I don't know what that number is, but I wouldn't feel right about sort of handing out lollipops to 8-year-olds, so to speak. That would seem past some reasonable point. But just young people at that age are capable of great things. And earlier in history, if you look at like ages of the founding fathers, well, they weren't 16 years old, but an awful lot of them were in their 20s and thinking deep thoughts before then. And there's plenty of areas such as sports. where quite young people in fact run things like teams de facto, even if they're not the coach, and can do a phenomenal job. And there's plenty of startups done by 18-year-olds that take off and do phenomenally well. And I think it was in the 1940s, well, the University of Chicago had a president, I believe he was 28 years old at that point, and he did exceptionally well. The military, you see this, and we just as a society as a whole haven't learned that lesson somehow. It sounds crazy to say, oh, young talent's undervalued, but it's massively undervalued.

If you think about like what either startups or organizations should exist to help people between 14 to 19, I guess you should say this is what high school should do perhaps.

Yes, but it's not going to, right?

Yes.

You know, my own effort, Emergent Ventures, is open to everyone, but we've ended up funding a lot of people in that age category. And I think there should in general be more experimentation both in philanthropy and education. And more experimentation will mean a bunch of efforts where those people get more autonomy. And I think those are some of the experiments that are going to win. But I don't have a single cookie-cutter approach like here's the one thing to do for the 16-year-olds.

Yeah. Well, and even people like Daniel who don't I actually don't know whether he was thriving in high school or not, but he chose not to do college. Like, there are people for whom they have some level of creativity or stamina or potential to be successful, but just don't thrive within our school system. What do they go do? I guess they can go on the internet and they could build community, like, but should there be more structures for those kids and what should they look like?

Well, Daniel did gaming since you bring him up, and gaming is in fact highly structured. And it gave him peers and a community. I would say on net, I'm pretty bullish on gamers, provided they have a good sense of when to walk away from it and do the next thing. I'm not saying they should all walk away. Like, if your goal is to be a game designer, you know, you shouldn't walk away from gaming. But still, most people doing gaming at some point should move on to the next thing.

That makes sense. I was charmed by your description that people that you accept into emerging ventures tend to not be super fans. They'll do their research, but the people who are super fans are not typically the ones that get in or doing the most interesting stuff. Why do you think that is?

That's true, but I would reword it slightly. I think I have a lot of super fans who are already super successful and they're just not applying. It's not that the super fans are all losers, but the people who are applying If they're super fans of anyone, it's not really about me. The being a super fan is a kind of personal substitute for energy they may not quite have, and they're sort of looking up to someone in a mimetic way, which is not what you want in your highest achievers. You want them to think they can kind of not crush me, but like surpass me or make me look foolish, or, you know, I'm not too impressed by that guy. Uh, and that to me is a more positive signal.

Yeah, how do you determine when, uh, like, what is the right level of success for someone to previously have such that you want to take a bet on emergent ventures versus like when is someone too early, when is someone too late in their career or development, or how do you think about that?

I'm very open-minded about that. So we made a significant grant to Emily Oster for her data-driven studies of COVID and K-12 and when schools should reopen. Now, Emily was famous to begin with, had some amount of money to begin with, but I thought what she was doing was so important and it needed to be done at the time, right now, not like 2 months later, that the notion that she would have to go through jumping through all these hoops to get money from major foundations just seemed obviously wrong to me. And we were able to get her money in 2 or 3 days after what was basically a 10-minute video call. So that's someone quite far along that I thought was obviously worth supporting. And then, you know, the 14 or 15-year-old, like, in a sense they are somewhat along, but, you know, they're still at the other end of the spectrum. So just to be open and to be aware of your own preconceptions and willing to fight back against them, I think, for what I do is the important thing, because I'm trying to support people working in a lot of different areas.

Yeah, you know, it's really interesting. Because of Twitter, we now see more and more young people build audiences earlier and earlier. They're kind of on a stage. And I remember when I was doing my first startup out of college, I was basically unknown and could experiment a lot and fail. And there was kind of just way less pressure. And thus I was willing to take more at-bats. Now, because I was less well-known, I didn't have mentorship or the kind of, you know, access that people who are getting in key networks earlier today. But one concern I have is that those people might be less willing to take risks because they have too much reputation to hold at such a young age that they're worried to be seen as a failure. And as a result, they kind of— they don't go for it as much as they might have otherwise. Do you see this, or what do you think about that?

I think about this quite a bit. So I think of cases like Mozart, who was famous, you know, in Austria really quite young. And faced a lot of pressure. People expected great things from him. He did just great, right? Magnus Carlsen was really very famous as a very young teenager. So I'm not convinced it's the fame that breeds risk aversion. I feel like the very best people will fight their way through that. It's almost another challenge to overcome. But that said, unless you are trying to be a Twitter-based public intellectual, too much Twitter, I think I do take as a negative. It's a sign you're fishing in another pond. Now, if someone wants to be the next Matt Yglesias and tweet all day long, that's the kind of thing I'm in fact pretty willing to support. But then I want to see, like, that's the plan, and then fine, great, you've got to practice on Twitter. But just someone doing something else, Twitter, Twitter, Twitter, you think they're choosing a short-term distraction to avoid confronting their real headaches.

Yeah. One of the things that I found most interesting from the book in terms of one of the things you look for is how to choose the right hierarchies. There are people who will have amazing talent, amazing stamina, but struggle or pick the wrong hierarchy. The 30th best chess player in the world or whatever it is, is the example you bring up. Talk a little bit more about what it means for people to pick the right hierarchies and how people can both get better at doing that and demonstrate their ability to do that.

Well, one of Adam Smith's key points in Theory of Moral Sentiments is that people look too much to local approbation. So today that might take the form of a super talented youth being in a gang and caring what the other gang members think. That's not going to end very well, most likely. And it may be the more talented they are, the worse it is for them because they'll earn a lot of money, they'll rise to a top gang position, They'll continue down that path rather than ending up disillusioned and leaving the gang. But there's so many other areas. Twitter is one of them. Chess is another. For many people, gaming. Or it's so easy to rack up approval if you're talented. And if you're young, maybe you're a bit insecure. The approval feels really great. It's maybe partly rebellion against your parents. A lot of local forces can reinforce that tendency. But, you know, for an awful lot of people, those are the wrong tracks to be on. It's the kind of thing, do it for 3 to 5 years as a young teen and then get the hell out is often the best advice. And the ability to see that is itself something, you know, you can scout for when evaluating people. So, okay, you want to do a $10 million startup and you're 17. Well, that's pretty great, right? But if in fact that's your only ambition, you as a venture capitalist, you want to know that too. And then it's all of a sudden maybe not so great. But if that's a stepping stone, you know, to Stripe, like the Collisons, they had a startup before doing Stripe, and clearly it was a stepping stone, uh, then you see the person's able to understand the broader picture.

Yeah, it's interesting. I mean, the thing you point to in terms of being something that can make a big difference on people's trajectories is sort of the, the, their peers, effectively. You know, they could be peers, they could be, you know, mentors, there could be apprenticeships. And I wonder, in an era where I think the Collisons were inspired by Paul Graham's writing. You know, writing is one format that appeals to certain people, but I almost imagine a world where the Elons or, you know, whoever, the people who have apprentices are almost livestreaming or somehow, basically how do we scale apprenticeships or how do we scale the osmosis from high agency people when there are so few high agency people and their time is somewhat limited?

Obviously the internet is a big help. You could read Paul Graham on the internet. to this day. But you want to be looking for people who are always looking for better peers. And a question I like to ask people, especially young people, is just, who's your small group of peers that you get inspiration from? And how do you think about them? What are you doing to improve that group? Or where do you fit into that group? Or I'll just ask, you know, in that group, are you the leader? And it's not the case you always want to support the leader. In fact, But it's a question that people find very hard to just flat out lie about. If they're not the leader, they won't just boldly say, I'm the leader, you know, they all come running to me. You get a lot of, you know, hums and ha's, but they'll ultimately let on they're not the leader, which again, for some projects may be fine or even preferred, but it's something you want to know.

Yeah. Let's talk about stamina. That's one of the also big takeaways from the book is that, you know, IQ is important, but in some ways can be overrated or it's not the only thing. And one of the things you look for is energy and And stamina. What are the, the ways in which you were trying to assess stamina, and what are kind of false indicators? Like, especially for young people, for example, especially if they are picking the right hierarchies, they're often switching a lot, and, and that could be seen as, hey, maybe these people don't have stamina or they don't have follow-through. How do you think about stamina more broadly? And then maybe that example.

Stamina is one of the hardest things to judge in young people. In older people, you just look at the track record. Maybe that's not perfect, but it really does pretty well, plus reference checks and just, you know, the obvious more or less works. I don't think I do a good job assessing stamina in young people, but just to get them talking about what they started and when and how they thought about their trajectories, maybe you get some partial insight. But someone else asked me in another interview, like on your wish list, if you had one thing you could grasp better than you do, what would it be? I would say it's judging stamina in the very young. I'm not sure that anyone is good at it. Maybe Peter Thiel would be the best at it, but it's simply very hard, and often the people themselves don't know. So it's not that you're trying to elicit something they're aware of and you just have to get them not to lie. No one knows.

Yeah, maybe it's even identifying stamina in things like Things that they've done for fun over, or like video games, or I just, have you committed to anything over, over a long enough period of time?

Even a TV show, right?

Yeah.

Just get them talking about something and see who in those fictional worlds they admire. And if they admire characters with stamina, I don't think it proves anything, but I'll up my P a bit on those people having some stamina themselves.

Have you had, um, success kind of evaluating people's motivations? Or do you think that that is something that is really important to take into account, sort of their stated motivations or even what you can discern? Some people are motivated by proving their parents, some people are motivated by, you know, just having to be the best, some people— I mean, people have all sorts of motivations, you know, dating, etc. How do you think about motivations?

I ignore stated motivations. I think they're often sincere but still a kind of BS. I do look at which audiences they're trying to impress. It's not exactly the same as motivation. Motivations to me are always opaque, even in the evaluators. But just, again, this question, can they pick out the right hierarchy? If they can pick out the right hierarchy and I don't think they're evil, like if I just think they're the next Darth Vader, it's like, you know, end of call. But if they're climbing the hierarchies in a useful way embedded in a society that is more or less healthy, Then I'm enthusiastic. It's a real problem, I think, in societies that are not fundamentally healthy. I don't want to name particular regions of the world. Well, let's name one. Let's say you were considering investing in someone in modern-day Russia and you were quite impressed. I still think in some ways you would be torn. Well, this person is great at climbing the ladder in modern-day Russia. How do I feel about that? It would just be tricky. Now, it's not what I do. It's not a problem I confront. But, you know, if they're from Denmark, you don't have that same conflict.

You mentioned 14 to 19-year-olds, that's an opportunity. How about after that? What do you think is malleable versus what's less malleable in terms of people who are looking to make improvements, or where should they focus?

Well, I'm funding one person through Emergent Ventures named Henry Oliver. And he's writing a book on late bloomers. You asked earlier, what do we not know enough about? One example would be late bloomers. As far as I know, there's no really good book on late bloomers, and there's a lot of them. And as I think you know, the average age of someone with a successful startup is actually pretty old. One source said 48. I don't know what's like the population they're measuring there, but it's not always an 18-year-old with a hoodie. So Obviously with older people you look more at track record, but for the outliers, track record is also going to mislead you a bit. Grandma Moses did a lot of her painting, you know, I think well into her 80s, and she wasn't famous before then. So you could look at her track record and say, oh, you know, for 80 years she wasn't much of a successful artist, but then you're going to miss out on Grandma Moses. So, uh, I think often with late bloomers, they did start something very early that maybe didn't come to fruition. There's a separate class of late bloomers. Many of them are women who had families, which is its own topic. But to be— one should be super alert for them. There's a very large number of them, and, and they are awesome, and you're not going to find them the traditional ways.

Yeah, and, and in my experience anecdotally with late bloomers, it's people who had, who had latent talent Um, but often were, were not, uh, applying it, or they just didn't— and maybe some life circumstances just kind of flipped something in their heads where they said, okay, now, now's the opportunity, or they just switched an environment or, or something. But yeah, it is interesting to think about how many people, if in a different peer set, even at, you know, past 25, past 30, uh, you know, and even much older, would drastically change versus not.

And there are some fields, I think chess is one of them, Where there just literally are no late bloomers, and I suspect there cannot be. Like NBA basketball. Oh, I'm 44. I've never tried point guard. Let me get out there. It's like, no, you know. Yeah.

Well, it is really funny. I'm curious. I don't know how deep you've looked into it. I haven't. But there's this kind of implicit and sometimes explicit disagreement between people like Charles Barkley and people like Daryl Morey on sort of how much there is a science of evaluating not just talent or latent talent, but also fit among teams. And Barkley thinks a lot of the data stuff in the NBA is kind of overrated. Do you have a perspective on that, at least as it relates to basketball?

Well, Barkley's a good example of that. He probably was actually 6'4, maybe even a bit shorter now, but his will to rebound was almost without parallel. And ultimately that showed up in the numbers. But ex ante, he was greatly undervalued. Steph Curry, I'm sure you've watched him, I believe was drafted number 7. He looked too small and too weak. Again, that's a judgment that made sense in some way, but his will to improve his shooting, you couldn't measure in any very scientific way. So clearly in sports where you have great numbers, the numbers are of immense value. In most sectors, you don't even have that option. But at the end of the day, the question, how much will the person work to improve compound learning? And how much is this person a knucklehead? Those you will not answer scientifically. It's your judgment. Yeah.

I mean, one thing that's interesting is I'm fast-forwarding to our world where we really understand talent and we understand, you know, not just we understand how to identify it, we understand how to cultivate it. We understand. I think one thing that's also important is like, it's not just, hey, can this person be a great founder? But would these 2 founders be a great fit? Like, if you imagined a global score, you know, score for different qualities, can we also imagine like a fit score? How much of that do you think that's kind of overstated? Like, you know, great people can work and work well with great people, or is there truly a magic to the fit? What is your perspective on that?

I think there's magic to the fit. And Daniel and I early on sensed we would make good co-authors. And I've co-authored with a fair number of people, not books generally, and there's just a huge difference. And everyone I've co-authored with has been very talented, but some things click and some things don't. Paul McCartney, John Lennon, right? Incredible fit, at least for 8 years until it all blew up. I don't think we have a good science of that. That's another topic. where I think we know almost nothing. There's very little in the book Daniel and I wrote that covers that usefully, but that would be on my wish list of let's at least like even have data on this. What accounts for fit?

Are there other topics that come to mind that would be on your wish list? For me, for example, it would be how to match founders and ideas or creators and ideas, how to think more about environments, that are best suited to unlock something in people. What about for you in terms of wishlists?

Well, let's see. There's, you know, how do you predict late bloomers? How do you predict stamina when someone is young? A lot of questions surrounding women who take on family commitments and then later in life when they won't have the kinds of track records you might see elsewhere, how do you evaluate them? I think is a huge question we're still not very good at. An entire set of questions across different cultures, across minority groups, it seems quite obvious we're not very good at. Understanding why some areas just boom with talent all of a sudden. So the Florentine Renaissance is a very obvious example. More modern would be India over the last 30 years. Is Nigeria next? Or also operationally, what can you do to increase the chances of a region But just what accounts for it. And if it's India, well, what parts of India or what age groups in India or what, whatever. Seems to me, again, we're fairly close to the zero point.

Yeah. And even much more locally, what's more likely to predict whether Stripe will have the next PayPal Mafia or Airbnb or Palantir or just analyzing a company and being able to identify, okay, these are the parameters that will encourage them to become successful founders. Peter Thiel, of course, says that PayPal, the people were successful partly because the outcome wasn't big enough. So it was still motivating for them to do so, but it was big enough for them to have significant resources while also being hungry.

You know, there's that new book on PayPal by Sonny, which I thought was excellent, but it raises the question, like, were those guys even good fit? It was clearly an amazing time and they all did amazing things, But they seem not to manage very well together at one level.

Yeah. Very, very great book and an interesting story. I want to shift a little bit to cultivating talent. You hinted that that could be, if you wrote a follow-up book, that could be one. Imagine, you know, thinking ahead a bit, what could some of the chapters be or what hunches do you even have on what you'd want to cover there or explore?

How to build the right small group. How to choose mentors, how to mentor people, how to make yourself attractive to a mentor, are some things that come immediately to mind.

Yeah, it is interesting. If you compare fellows that you've had, for example, these are just 2 examples. Nadia Akbar, I believe, is a fellow, and I believe you selected her when she's a bit more further along in her career, a bit more post her book. Now, the fellowship can still make a big difference to her, But it feels like someone like Dave Perell, you, you picked before he had an audience, before he had his business, and that really catalyzed. And so it's an interesting thing to think about, you know, if you envision a world where there's much more Thiel Fellowships, much more Emergent Ventures, which is probably going to, going to happen, just where they will play and, and what, what that could look like.

David wrote me one of the best cold emails I've ever received. I had no idea who he was. And he's put that cold email on Twitter. But I don't think of Nadia as so far along. Across some dimensions she is, and she's super well connected. But as a writer on the topics she's chosen, she's just starting.

Sure.

So, in that sense, you know, it's not quite T0, but not far along, I would say. And seeing that was critical to my deciding to support her.

Yeah, VCs have what they call an anti-portfolio, the ones that they passed on that they wish they didn't or made mistakes. I'm not sure if you guys are old enough that you have such a, you know, fleshed-out anti-portfolio, but to the extent that you've made mistakes and when you've passed on people that in retrospect you would have taken, what do you think it was? What do you think you missed?

Emergent Ventures has been around for about 4 years. But I've been hiring people in different capacities, you know, for decades. So the last 4 years is much harder for me to say. Who is there I wish I had hired whom I didn't? There's a lot of people in the public policy arena that I would have hired at Mercatus or done more to promote, say people writing early on crypto, and we did have a number of them at Mercatus. But I would have done much more on that. That would be one ready example. And there are people who are not credentialed, they're brilliant, they might write some essay on Medium, they come and go. It's not clear you can ever describe what their job is. And they're hard to hire into research centers or think tanks. But I undervalued those people, a whole bunch of them. That would be an example.

Yeah, interesting. One of your key lines is, you know, it's one of the best things you can do for someone is raise their aspirations. tell them that they're capable of doing more, and we put them in a peer set that helps reinforce that. And that's what you do with your program. It is interesting. One of the things that that implies is also knowing what they're capable of. And this relates to this field of talent identification and evaluation. And you can almost imagine there's a world where there's like a Hogwarts sorting hat that says, hey, these are kind of the natural skills you have. you know, based on your environment, based on your genes, here are things that— here are directions that you could go into, and you should, you know, explore this, move here, et cetera. Like, what could we envision in terms of just better utilizing the talent that we have?

I don't know. I'm not sure I'm such a believer in extreme transparency. So some people I know, they have this vision that somehow genomics will become so advanced, you'll sample the kid as an infant, and it'll tell you Well, here, this is a great oboe player, or, you know, this person should, uh, do a programming startup. That— there's something to be said for people who are not tracked too early and who develop synthetic skills precisely because they're semi-failing at some things early on, but not completely failing. So it's not my golden dream that we have all this transparent information about what everyone can do. I can see it's useful in some ways, but it's just not how my thinking runs, that there's this exploration process with a lot of years, a lot of mistakes, a lot of discovery, and just people who are good at that. I look for more than trying to figure out the full transparency of the situation.

Yeah, yeah, it's interesting.

I mean, look at some of the great tech entrepreneurs. So you look at Bill Gates or Patrick Collison. Whatever you think of their impact through their companies, we don't even know yet if they'll be more impactful through their companies or maybe through their philanthropy or some other way. We still don't know. So even that's not transparent.

Yeah, or even, will Twitter be the most influential thing Elon does or something? Yeah, it's interesting.

Yeah, and I'm not sure we'll know in 30 years. It's not like, oh, wait 2 years and then you'll see with Elon.

Yeah. One of the things you guys talked about in your podcast is, Why there's so few, so few Elons. Why are there so few Elons, so few Patrick Hallsons?

Well, there's more than there used to be, right? So everything's relative. But if you look at Elon, who, to be clear, I don't know personally, but from what I've read and what I hear, it seems to me quite important that he came from South Africa. So bred in him some sense of emergency, a mix of extreme urgency with insecurity, exposure early on to Peter Thiel, Reid Hoffman, Other just truly top performers, talent evaluators, a belief himself in the extreme relevance of talent. So his deep involvement in hiring at SpaceX and just extraordinary ambition and sense that things can be done. And people I've talked to at SpaceX will just say, you know, Elon is the best engineer in the company, not like he's the best CEO or the best leader. He's like the best engineer when you have a concrete question. So to stack all those things together with the guys like AA+ or sometimes AA++, it's just going to be rare, right? But the fact that he's from South Africa means we're missing a lot of people like him because not everyone from, you know, fill in the blank country of your choice is going to get that chance.

Yeah, that's really interesting. You know, one of the ways that I think about what I'm inspired by is this idea of, it's a play on Google's organize the world's information. It's organizing the world's ambition. And you think about every layer of the stack, right? It's how do I unlock potential in people, identify them younger, raise their aspirations, put them in the right environment, think about the right fit. If they're starting companies, it's match them with the right idea. So many talented people work on the wrong idea in the wrong market. or, you know, with the wrong co-founder. But then it's also on the other side, so many employees are at the wrong company. And because there isn't a super, you know, transparent, you know, liquid employment market, they don't know other companies that they could be interested in who would also be interested in them. I think Vue is, you know, motivated by this, this idea of organizing the world's ambition as well. When you think about the stack, like, what do you think are the highest leverage of intervention points, or what do you even think about my framing? What would you add to that in terms of like organize or edit in terms of organizing the world's ambition?

I think there's massive status quo bias in most parts of our world, even at the individual level, clearly at the institutional level, but even individuals. But I think what you can do to help is when people are young, say in the teen years, to fly them to some area of excellence, region, conference of excellence, assemblage of talent, And just let them meet some top people and get a sense of more role models. And this is common advice I give to parents. I say, at some point, your kid's going to stop listening to you, maybe at age 12, 13, probably 12, maybe 11 these days. But you can bring over your friends for dinner and have them meet your kids. And your kid is still looking for role models at age 12, 13, and beyond. So your real impact is who else you expose them to. So have some good friends, if only for that reason.

What, uh, what didn't make the book in terms of it was either, you know, you had to publish it too quickly or you couldn't figure it out or didn't think it was, it was appropriate for this one?

There's a lot of issues surrounding race and minorities that are important. I feel 2 white guys writing a book in 2022 is not the best way to handle that. Uh, probably a Black author should take on those issues. I hope that happens, but there's relatively little of that in the book. It's probably for the better, but it's something missing in the book. We say a bit, not that much. I'm fine with what we said. Just keep an open mind, educate yourself. I'm pretty sure it's good advice. It doesn't run that deep. It's another thing on my wish list, but I don't think it's something that I personally will do.

Yeah, no, yeah, I was surprised and impressed that you had a that you did a dedicated chapter to it, and I thought you handled it well. But yeah, I could see how more research—

It should be a whole book, right?

Yeah.

But from someone who, as a Black person, has very direct personal experience as a Black person, I think would be a better book and also a better received book.

Yeah. What's interesting about your fellowship is you must face this tension where you want to grow it because there's all these amazing people out there and you want to give more opportunities to more people, raise more aspirations. But at the same time, the people who are inside of it, and maybe you to some extent, you know, might not want it to get too big lest the credential or the signal be muted to some extent or reduced to some extent. To the extent that you're facing that trade-off, how do you think about that trade-off?

Well, I think I just dogmatically want to grow it. And I think I'm capable of not lowering my standards. So if I hand out more money, I don't gain personally. Like, there's not someone who's paying me a salary and fires me if I don't make any grants this year. I'm kind of zeroed out at those margins. So, um, if I just keep standards and give awards to people that seem good, at least if I'm correct often enough, uh, that will be a reputational benefit for those who got it earlier.

Yeah.

Because the word will be spread further. So it seems fairly incentive compatible for me. I guess my worry is if so many people get it, I just can't remember them all anymore. Uh, but so far I'm fine on that.

Yeah, and I presume that's what happened to Paul Graham and Y Combinator, but they seem to pull it off well.

There's a bunch of people I've forgotten, but they haven't done anything, and I'm happy to forget them.

Yeah, it makes me think, have you considered, um, you know, becoming more of a formal venture capitalist yourself? or investing more in startups yourself given, you know, brand access, ability to discover talent?

First, I think it's fairly different from what I do. So Emergent Ventures, other than the India part, I think we now have over 170 winners. Maybe 20 of those are for-profits, and I certainly hope they make profit, but in some sense they're idea-based projects. And I think my greatest strength is in evaluating idea-based projects. And not necessarily how commercially minded someone is. So the world of ideas, media, journalism, I know very, very well. A lot of knowledge is context-specific. And if I were just profit maximizing, I don't even have a conviction I would necessarily be very good at it. But also, if I think about my own life, my own aspiration is to become an information trillionaire. I have a great deal of personal freedom in a way that kind of like a senator might, to use a funny example. And if I were doing like a 24/7 for-profit venture, I would lose that freedom. And I don't see that I would be better off. I don't know what— assuming I did very well, I don't know what I could buy with that money that would be more valuable than what I buy with my senatorial discretion over my time today. It's a complete answer. I don't think it's a BS answer. Usually you ask people about themselves, especially like, would you love to have more money? Do you want to do this? Do you want to do that? Like, the quality of the answers you get is pretty low mostly. And the smarter the person, often the worse the answer. But I think that's my proper answer.

Yeah. I think if my short response would be, if more money wouldn't really change anything, then yeah, there's no necessarily reason to do it. I do think there's a way you could do it that wouldn't take much of your time, whereas if you just explicitly said, hey, I'm not going to do time, but if I've influenced your career in some capacity and you want to make room for me on your cap table, I'm happy to consider it. And I wouldn't be surprised if there's a lot of Patrick Collisons out there, big-time entrepreneurs or future big-time entrepreneurs who've kind of grown up on Marginal Revolution And would love to have you even informally or even peripherally involved.

Maybe, but just to stay purely selfish for a moment, it might be better just to reap the social capital from things like that than money. And then money becomes this almost unnatural object of desire. And again, I don't know, I'm not sure I would end up better off. chasing after many more.

No, no, fair enough. So I mean, is the future of Emergent Ventures— like, do you see it as something like a Y Combinator for intellectuals? Um, or like— and what do you think about just that idea in general, like a YC for intellects, if that is not what you're doing?

Well, I think the future is more branches and more scouts. So Shruti Rajagopalan, who works with me, she's an Indian woman. She runs Emergent Ventures India. And she does it herself the way I run regular emergent ventures. And she's great at it. We're in constant contact about it, but I don't try to influence her decisions. She's really truly autonomous in that regard. So to have that for different sectors, different parts of the world, different whatever, I think there's a lot of room for growth. And that's the future of the idea. And then just other people doing it on their own.

And I appreciate the Village Global shout out in the book about Scouts. Maybe gearing towards closing here, one thing we haven't talked a ton about as it relates to talent is on culture. There's things called small poppy syndrome or certain cultural dynamics where people are less encouraged to be great. They're maybe more encouraged to be happy or be content or be accepting and less individualistic. Certainly a lot of pop culture, you just go on Twitter at any point and moment and look at what's trending. Of course, it's customized to what you look at. Often it's feuds or kind of just frivolous stuff. I'm curious if you think our culture relative to— well, I have 2 questions. Our culture relative to previous— you've been alive for some time, you mentioned you're 60, seems less ambitious or more ambitious than prior? You mentioned raising aspirations. How do you think we raise aspirations on the macro level or on the cultural level? that will then seep back down to individuals?

There's a lot of different questions in there. I suppose my core model of the current day is that the variance of ambition is increasing, and that has a good side and a bad side. The upside is tremendous, more talent than ever before, people doing things, people in touch with each other, and those are mostly the people who are going to be productive. So the people who might be productive are doing just great. They're smarter than ever before, more energetic. The people who are less productive or energetic, I think it's much more of a mixed picture with a lot of negatives. You see this in social indicators. Those are problems we need to solve. But like you or I, if you're trying to work with people who will do things, there's never been a better time to do that. More parts of the world are open. And I would just say it's important to keep a really open mind about different cultures. So say you found a culture that was all about cutting down the tall poppies. Some people say New Zealand. Whether or not that's true, but the point is that culture may just drive out its ambitious people to somewhere else. And then, oh, Peter Jackson becomes a famous director, Steven Jennings goes to Moscow, starts Renaissance Capital, and that can work too. So there's not a single model that works. Keep an open mind, and now's a great time to be doing this stuff. But we have vast social problems. We shouldn't ignore that. And in part, you want to support the most talented people so they can help out the rest of humanity.

Yeah, I think that's a great way to put it. And maybe now in closing, one of your favorite questions is, what is the equivalent of musical scales that you're practicing every day to get better at what you do? Help make that concrete. Like, I imagine for you the answer is writing, or reading and writing. Feel free to edit that. But what is sort of the answer for someone like Daniel, or someone like Patrick Collison, or someone like Peter Thiel, where it's not as clear maybe?

Well, for me it's reading and writing, but it's not only that. In my role as talent selectors, it's having calls with people every day, meeting up with other talent selectors, and just looking at a lot of portfolios. Now, Daniel himself recently was asked, like, what's your equivalent of doing scales? Maybe it was— maybe I asked him, and he said, like, having those very regular calls with the super high potential 20-year-olds and hearing different pitches and projects, and that, that's what it is for him. Now, what it is for Peter, I mean, I wouldn't say, but I'm pretty sure it's changed a lot over different phases of his life. And it's going to be different for almost every person, even if like they're all venture capitalists. There's just a lot of different models out there, and I wouldn't expect those answers to all be the same.

It is interesting. I mean, one thing about raising aspirations is not just saying that people are capable of much more, but perhaps kind of like helping people narrow down the, the, the options. I'm, you know, someone like— I'm curious how confident you would be in your own advice if you, you know, were talking to Peter Thiel, like, after PayPal saying, how should I spend my time? How, you know, what types of products should I get into? Or even someone like Daniel today, who, uh, obviously he's got a venture with, with Pioneer that's, that's quite well, but he also has, you know, decades ahead of him. What is your take on, on your ability, or even one's ability, to look into the future and, uh, give people advice, like, more specifically as to where they should spend their time or how?

I don't view myself as such a great predictor. So you mentioned Daniel. I did give him the advice, I think you should write this book with me. I don't in general give him advice, and there are ways you can be useful to people that are not the same as giving them advice. And advice is not usually taken as advice. It can be taken as an attempt to control, or, oh well, actually the person is talking about themselves, or there's some other emotional, often kind of crummy agenda, not intended in a negative way, but maybe advice just isn't that useful a genre. And to try to do better yourself is the best form of advice you can give your friends and just interact with them.

Yeah, that's well said. I agree. Do you have a next book already picked out?

Well, there's the possibility of a sequel to Talent. In part that depends upon the world. I think Daniel and I have enough ideas, but there's a long-run project I've been working on, which is a history of economic thought, which is not a very salable or marketable book. And I have downtime between projects for different reasons, and I want to be working on something that will be an evergreen, will always be good. And most books in economics are not like that. You try to write about COVID or Ukraine, whatever you say, it's obsolete in a month, right? But if you're writing on the history of economic thought, it may not come out for a long time. You know, what I say about Adam Smith and John Maynard Keynes, right? That's evergreen. So that's my other long-term project. In between other things I do, I work on it, and it actually has a lot of work in it at the moment. Hundreds of pages.

Wow. Well, whenever it's appropriate, count me in as a beta reader to give the non, um, you know, economist perspective, or the, you know, the just curious person perspective. That sounds really interesting.

Thank you. I will do that.

Awesome. Well, Tyler, the book is, is, is Talent. It's written by you and Daniel Gross. I will take away, uh, not just the idea to look for, uh, stamina, energy, durability, curiosity, but also, uh, how to reveal those, those elements. And one of my favorite parts of your book was, was in the interview, instead of asking you know, kind of rote questions that they probably asked before, try to get them to talk about, uh, tell a story and, and talk about things they know well and, uh, try to break the fourth wall of, of the conversation. So, so thank you for, for, for writing the book and thanks for coming on the podcast.

My pleasure. Thank you for having me on.

Thanks for listening to today's episode. Execs is produced by On Deck, where top talent goes to start companies, find their next roles, or invest in their careers. If you're looking to start a company, uplevel your career, or navigate a career transition, I encourage you to visit beyonddeck.com. See you next time.