EP 1: Bolt vs. Stripe, Calendly, Market Meltdown and Billionaires Tweeting

Welcome to the first episode of Three Cartoon Avatars. I'm Logan Bartlett, a partner at Redpoint Ventures.

I'm Nikita Beer. I founded tbh, which was acquired by Facebook. And now I'm working on my new thing, Zach.

I'm Zach Kukoff. I'm an investor at General Catalyst.

Since this is our first episode, we figured we'd give a brief explainer on what this is. We all have day jobs, Zach and I as investors and Nikita as an entrepreneur. But I think what we're far better known for is what the kids call shitposting, or Zach used to be known for it.

Oh, come on.

The three of us became friends over the last few years and we would joke on Twitter and we would side text about the crazy shit that was going on in the always interesting, very online world of tech. And so we decided to basically take our group chat and Twitter observations and turn it into a podcast. So we're going to do this once a week. We're going to post it on Saturday mornings. Sometimes we're going to cover the big stories in tech, maybe with some level of analysis, but honestly, if you want super serious analysis, I'm sure there's far, far better sources for that than the three of us. I don't know if it's CNBC or something. There's someone stratecher that can give you far better actual analysis. What we're going to do is cover it, hopefully in a humorous way or at least from an insider baseball type analysis of the different players, the different things that are interesting. More importantly, I think we're going to cover the stupid shit that is tech these days. The memes, the Twitter beefs, the idiot billionaires, basically all the stuff that we actually talk about. And hopefully we'll do it in a entertaining way at a minimum. I think we all have loving families, so that should give us some minimum support group of people that'll listen to this.

Yeah, finally my big Italian Jewish family will come in handy.

I think if we crack 10 listeners, we're in good shape.

That's good. Yeah, we're setting the bar compared to

every other podcast on the Internet.

So thank you to all 10 of our listeners that are here. I mean, what could possibly go wrong? Or three friends making a weekly podcast just shooting the shit. There is no precedent for anyone doing that and having major, major ramifications come out of it. So I don't know, I think maybe. I don't know if it's a goal that we should aspire to or something to avoid, but the White House issuing a statement about something we say on this podcast. I think that's something we can look to some point in the future.

Yeah, I'm still aspirationally trying to get acknowledged as a minor owner of any sports team. So any sports team that wants to cancel me, please give me a call.

I'm open.

That's good.

I just want to get canceled.

Nikita, you try very regularly. I think Zach and I are trying not to. We will see. Desperately.

You guys can throw me in the bus if you guys say anything.

Any lines I don't like Nikita wrote. Actually, any lines that Nikita you like I wrote.

That's right. Yeah. Perfect. Well, we have a handful of topics to cover today. I was honestly nervous that we missed the boat. Just to give people a little bit of the backstory here, we originally tried to get our first episode last week where we would have been able to cover Chamath and the. The controversy and the fallout of all that. And I was a little apprehensive that it would be hard for us to find as many funny, good topics as all the implications that came out of that. But the good people in the tech world always seem to deliver for us.

So, yeah, who could have predicted that the entire tech industry would go back to the AOL chat room days just in time for us to launch our podcast?

Honestly, very serendipitous timing here. Markets in turmoil, billionaires yelling at each other.

It's because we're all part of the Silicon Valley mafia. We teed all this up just to have good content for the week.

Just little puppet strings here. We are just setting up our content. Okay, so our first topic we're going to cover today is Ryan Breslow, who's the founder and CEO of a company called Bolt that had raised billion dollars, Most recently at $11 billion valuation from investors like General Atlantic, BlackRock, Tribe Capital, Activent went through a Twitter thread accusing Stripe and YC basically of being the mob bosses of Silicon Valley. There's a full thread there that you can. You can read. So let's first disclose here that both Red Point, my employer, and General Catalyst, Zach's employer, are both investors in Stripe.

Very happy investors, not coerced whatsoever.

We want to give that caveat to show that we are part of the puppet strings that they are pulling throughout Silicon Valley.

So anything that enhances my power, I'm happy to take credit for. That's correct.

That's right.

You guys are made men, right? You're in the mafia.

Correct.

I don't think you're not a made man until you hit gp, Nikita. I still have a little bit of time before I'm a made man.

You're just a goon at this point, Zach.

That's right. I'm, like, about to get whacked if I say the wrong thing here, so I'm going to keep my mouth shut.

There's actually a branding session when you get into the mob that they bestow upon you. So I think we can go through each of the points that Ryan made here. I think if you zoom out collectively, it sounds very salacious. If you zoom in, maybe it doesn't hold up. We can talk through to what extent Ryan actually believes this and that there is a conspiracy against them versus what is actually just PR and getting their name out there. I mean, here we are leading an episode, talking about them. He had people across Twitter talking about this and Bolt as well. And so it certainly has been some good earned media for them. Each of his claims, the first was he was rejected from yc. Now, I don't know if anyone here has been rejected from yc, but multiple times, my understanding is that's a pretty common thing. There are lots of people that are rejected from yc.

I'm still bitter about it. Gary Tan rejected me. But we're friends now.

And do you think that's evidence of a conspiracy theory against you, Nikita? Do you feel that Gary Tan.

The whole world's working against me?

We're going to have Gary on next week for his side of the story.

There are two sides to this coin. Well, what's interesting is like accusing YC of rejecting him because they were also invested in Stripe. Like, YC notoriously has different flavors of all the same companies. Right. Like, every batch seems to have three different versions of the same business. They seem to, in each subsequent batch fund, like a slightly different sliver of geography. Okay, this is now this company for Mexico, this company for Colombia, this company for, you know, Eastern Europe. Western Europe. Right. I don't think YC really conflicts people out based on some other investment.

No, no, famously not. Right.

But I mean, to be fair, Stripe is their golden goose. Like, that's going to make up most of returns.

So, I mean, come on.

I think they're a little bit incentivized to make sure it performs, but I don't think they'd go as far as, you know, rejecting a payments company. But.

Well, and this was also 2012, 2013, so to be fair, whatever time this was, it wasn't today. Right. YC has scaled far beyond what they are today. Stripe also was less powerful.

Even, even in 2012, 2013, they were taking conflicting companies into YC. Like, this is not a new policy pivot they've had. Like this is, this is core to the concept of YC is they're not a vc, they're not an investor, they're not in your board. Right. It's in fact, if anything, they were less hands on with some of the winners in 2012, 2013 than they are today.

The other thing that falls apart in it is he goes on to say, Ryan does that he was subsequently invited to join yc. And so I don't know, I don't know how. Like at one point he was blocked and then he was invited back, but neither here nor there. So the second claim that he had was that Tier 1 VCs turned him down because of perfect back channel that Stripe was able to give to these VCs that convinced them to not invest in the company. And then the second point within that is that Stripe had taken money from a host of venture capitalist tier one firms, the two best firms included on this podcast as well. They were therefore conflicted out from taking money from the name brand of Silicon Valley. So I don't know what you guys think about this, if this holds water truth level here.

Have you guys ever rejected a company because of what you heard in the backchannel?

100%?

I mean, yeah, absolutely. Yeah, of course. Now, you know, the one part of this that does hold water is certainly, without commenting, any specific portfolio company of ours. Obviously companies do raise money from venture funds with the thought that they will. Those funds will then be conflicted out from investing in a competitor. That's certainly true. And certainly it's the case that, you know, any company that raises from a huge swath of top VCs is expecting those VCs will not turn around and fund a direct competitor. You know, six months, a year later. It's like you can dress it up in conspiracy theory language all you like. That's a reasonable and normal part of raising money in sf.

It's the right thing to do, actually.

Right, right.

It's probably not conspiratorial as much as it is business tactics. And to be fair on this point specifically, Sequoia did invest in Finix, which my understanding is a somewhat similar business. I don't know Finix's business quite as well, but they're at least in the same world as Stripe and in kind of an unprecedented way. This was probably two years ago. Sequoia actually just gave back their shares in Fenix because of the conflict with Stripe. So there isn't to say that this is totally without precedent, that there's some element of this that exists Now. I would say that it seems to me that Finix's business is far closer to Stripe's than Boltz is. But there's some elements of VCs and Sequoia specifically trying to make nice with a very important investment of theirs at the expense of another investment.

But listen, like, Sequoia is a great example of this. I think we all saw that Sean tweeted that the reason they didn't invest in Bolts had nothing to do with any Stripe investment. Right. The real reason that the metrics weren't there, that's the hard thing. Like, what's the great phrase? Never attribute to malice what you can attribute to incompetence instead. Like, not to say that these firms are incompetent, but it is to say if the metrics aren't there.

What did you guys think of Sean's tweet? Because I've never actually seen a VC actually publicize, like, what their assessment of metrics are about a company that pitched them. I thought he had to defend, you know, his firm, but at the same time, it seemed really detailed in his. In his response.

Well, did he have to defend Sequoia? Like, did anyone? Like, maybe I missed it in the thread, but did Ryan say Sequoia specifically did X, Y and Z? It felt a little bit beyond. There was a norm that was violated. Right. Like to Nikita, to your point.

Well, Sequoia was mentioned along with YC and Stripe. Right. So they were one of the named firms in this conspiracy element. Sean noted that he is friends with or has known Ryan for a while. But also I think in his bio on Sequoia's website, someone posted it that he is also friends with the Collisons. And this is obviously an important investment for Sequoia. It's something that I think people were probably thinking on the inside of Silicon Valley of, hey, there's probably a lot more to this story of why people didn't invest. But it was unusual. I had never seen before someone air that laundry. There's an element of trust that exists between VCs and the companies that pitch to them. And this clearly was something of an exceptional circumstance that Sean felt the need to come clean and calling it the steaming pile of shit on what Ryan was saying. But there was clearly some standard, gentleman, agreement, whatever you want to call it, that was broken, that I had Never seen broken before.

Doesn't it feel like it's part trust and also part. There's a power dynamic here. Like, it feels a little bit like punching down to me to say, you know, no matter what any founder goes out and says, for a VC to come back and say, well, actually, non, non, poo, poo. Your numbers weren't there, like in a public way in front of what feels like the whole industry. I don't know. It's uncomfortable to me. And it's more than distrust. It feels like there's a. It feels like you're taking advantage in some ways.

Yeah. I mean, I think staying out of this was definitely the best angle to have in all things. Right. Like involving yourself in the discussion. It just didn't feel like it served anyone that was mentioned well. And I realized there's no. From Sean's perspective, like, obviously he's defending both a friend in Patrick Collison or whoever he's friends with as well as his firm. And so maybe it was low downside to him, but yeah, hard to say what was actually going through his mind at the time. Now, what was interesting in that is the one person that was like the torchbearer for this being a breaking of norms was actually Jason Calacanis was the one that was out calling out Sean. He was calling out Marc Andreessen posted a meme that it was basically a superhero. And it's the one with two buttons down and one was the four day workweek, and one was blaming a competitor or blaming Stripe. And for context, Bolt has come out very publicly in shifting to a four day work week. And so Marc Andreessen was basically making a meme of someone being stressed out of what to do. Do I blame the four day work week or do I blame Stripe for my problems? And Jason immediately called out both Mark and Sean for breaking whatever this is. And it led to this is below my line, which was a meme from last week, was being thrown around between everyone. And so it definitely reverted to some level of name calling.

Yeah, I felt like it was a pretty aggressive level of name calling pretty fast. Right. And by the way, shockingly enough, I feel like the real critique here was against YC as much as it was against Stripe. And yet because there were so many stripe defenders who jumped in, you know, the actual YC portion of this sort of went relatively unnoticed. There was the very detailed defense of Hacker news that dang. The moderator posted. And it was actually thoughtful. Right. It was about, hey, actually the thing that Ryan said they Posted two hours before, they posted two hours after the collisons.

Right.

It wasn't taken down, it was just not voted up by the community. Fine, very reasonable. Seems like it's correct. But because it was on Hacker News, not Twitter, because it wasn't VCs doing funny memes and you know, sticking a finger in somebody's eye, it didn't get much play.

And for, for context, just another one of the accusations. So I counted, there were roughly four, the last two just for. For. For listeners benefits. So it was that Hacker News, which is a website that is owned by and run and moderated by Y Combinator, is a place that a lot of engineers, developers spend their days and it basically has a Reddit like upvoting system, downvoting commentary, all that. And one of Ryan's accusations was that basically it was being gamed by Hacker News by Y Combinator to make stripes Posts exist above Bolt's posts. And so what Deng did was he basically broke down, hey, here's why this happened, here's what our users did. Now to some extent it is self fulfilling in that the users are the ones that vote. And therefore if you think the users are on the inside already, then it's kind of a circular.

Yeah, but also what you're saying the thousands and thousands of random IC engineers on Hacker News are all shills for Stripe.

I think it's that Hacker News has always had an opaque algorithm. I think if you post on there frequently, you run through these kind of scenarios in your head like why did my posts get removed? Why did they re because they renamed titles too on posts.

Right.

So I think, you know, it wasn't that like stretch of an imagination to think that posts were being removed. I just don't know if it was malicious. Like there's no evidence that it was actually like they were being targeted. I can see how he came to that conclusion in his head.

But dang did a very specific job of breaking down the different timestamps and what happened. And just for listeners benefits like the group that this is appealing to are the independent developers that like open source tools that like bottoms up sales motions that like great documentation on APIs. Right. And all these things are what Bolt doesn't have. Stripe has this right. Stripe is renowned for their API documentation. Bolt is more of an enterprise product. I think one of the things in the post that they were talking about like within the first three sentences there was a reference to Gartner, which is an industry research term that's basically like calling yourself hey, I talked to my boomer uncle and said this, right? And so that's just not going to appeal to the hacker news crowd. And so dang, did a good job of deconstructing that. But I agree with you, Nikita.

Yeah, Stripe has done such an exceptional job in earning that respect. Like every time they post one of their new products, all the comments are on how sexy the landing page is. And that's actually what I think a lot of people don't notice about their marketing strategy, which is make the front end of their website so sexy that it attracts the front end engineers to use their product who eventually integrate that JavaScript snippet. It's like they over invest on all those things and it just appeals to the hacker news community. They're just blown away. They really push the envelope on that stuff. They've created the perfect storm of ranking on hacker news every single time. I think, you know, Stripe and YC have always had this like hot girl vibe and they just perform so well that it just makes all of us jealous. And I mean, when I got rejected from yc, I was like, oh, they're all against me. But they've just executed at 100% for the last decade.

I will say that characterizing it as mob of Silicon Valley plays into this like, hey, there's this inner working and that there's these taxes that are being paid. At the end of the thread it was, hey, you have to pay the the tax to own the land in the way that it is with the mob. And at the end of the day, these are the cool kids. Right? It's not that they're the mob and they're like going around, you know, knocking kneecaps and collecting cash. It's that they're just the cool kids that everyone sort of looks up to and wants to hang with. And they hire really good smart people and they spin out really good interesting companies and they're just influential. Right.

One thing I can't explain is why did they give fast 100 million doll valuation when I've never seen a fast checkout anywhere on the Internet?

Well, that was the final accusation. Stripe funded Fast, which is another one click checkout startup company for $100 million at a billion dollar valuation. My understanding is pre launch. And FAST also has a very public Twitter posting. CEO, although I've seen him less on Twitter these days.

Yeah, I think he's been pretty quiet recently.

Yeah. And so the accusation was that they couldn't do it through all these other tactics and so therefore they had to empower a competitor, which I don't know to some extent. If you wanted to empower a competitor, wouldn't you just do it your yourself rather than give someone $100 billion to go do it? But it was another allegation. Now it seems like FAST is still very early in their journey. I don't know the inputs that went into deciding the valuation or you know, I never had a meeting with the company so I have no idea.

But I do know another fintech company I'm not going to name it but that was funded by Stripe that raised at 100 million valuation pre launch. So maybe that's just their approach as they find, you know, a team that they believe is talented pay top dollar just to get, you know, first access to it.

I will say it feels like our Civic duty as VCs based on all the the controversies and entertainment that the CEO of Bolt and the CEO of FAST have started over the course of the last two years. Like funding one click checkout feels like it's our civic duty just for everyone's entertainment. It's the one, it's the one good that we do in this world. It's like how do you make the world better? Well, let me tell you about these Twitter threads.

We got to keep producing content for the podcast. I will say my favorite response to all of this was when Patrick Collison, I think it was today or yesterday, announced the new editorial team at Stripe Press and said, hey, send in your book proposals. Lockheed Groom responded, what happens if we don't? Which I really appreciate it.

That's good. Lockheed Groom is a notable former Stripe employee now who has his own venture firm. And yeah, Locky had a pretty good sense of humor about this whole thing. So our next topic was a recent Twitter thread by Sam Lesson, a partner at Slow Ventures, a former Facebook employee, basically going into one of the third rail topics of Silicon Valley, which is the etiquette around sending a Calendly link. Now for those that don't know, Calendly is a self scheduling app that you send a link and it integrates with your calendar and allows you to book someone's schedule on the other end. It's a pretty slick, easy to use viral tool and for whatever reason it seems to be somewhat controversial because of the power dynamic and what it says about your schedule versus the other person's schedule and your time versus their time. And so Sam Lesson came out with a post entitled Callan Lee Etiquette is the most raw, naked display of social capital dynamics in business and Basically, he goes on to say that the point of it all.

I'll set some context. Sam really has a monopoly on bad taste. That was a tweet. Why did he pick these battles? Is this.

Where is Elizabeth Warren when you need her? We finally have somebody we need to break up. Big takes on.

I didn't realize this was a recurring thing that Sam had these takes. It just, it felt like we were idly going about our day and just sort of like watching Marc Andreessen battle with Jason Calacanis about Bolt and then like this bomb just got dropped and I'm not sure, like, was he sitting on it? Was he like.

Well, none of his posts have ever gone this viral, right? This is the first one that really. And there have been some varying take qualities in past posts is all I'll say. But this is the first one that's really struck a nerve. Logan, to your point, and the recurring battles of the Valley, I mean, it's a serious issue.

We have Russia invading Ukraine and then we also have Calendly, which I think

is we should just all be thankful Sam didn't post about how many hours you should work in your 20s, because that's the real third wire of tech Twitter.

That's the next one that's coming down the pipe, by the way. It's how hard you have to work this. And it's docsem versus PDF. So basically his takeaway was that he said, in practice, I will never click on your calendarly link ever, unless maybe you are the President of the United States. I don't want to go through the whole thing, but the overall point is that it's signaling that your existing calendar and your time is more important than the other person's calendar and their time.

And by the way, what great advertising for Calendly. That Sam Lesson thinks that a future President of the United States might start scheduling through them. I mean, you can't buy that kind of media.

Well, I saw Tope actually the CEO of Calendly tweeted out. Thank you, Sam Lesson. This has been a amazing day for. For signups for us, right? This is the type of we. I'm not sure if Ryan from Bolt was like trying to manufacture this level of pr. I assume he was, but Calendly was just going about their day and got a PR bomb dropped on their behalf. With all these people debating takes on the etiquette of it.

Important question. Do you guys use calendly?

Here's how I use calendly. If someone sends me a Calendly Link. I just send back my own calendly link to maintain dominance in the relationship. And I don't use it, but that's the only context that I do use it.

You use it, but it's basically to show them who's boss. Like, you are submissive to me, I assume. Do they have a plan for that? Nikita, are you paying just to flex every once in a while they should have that. Actually, I do just pay.

Every time Sequoia tries to meet with me, I send them a calendly link.

See, I don't want to send it to other VCs. I want to send it to, like, service providers. Like when I have to call my dentist for eight hours on the phone to schedule a teeth cleaning. I want to send a dentist to calendly let them book something. That's why. That's how I want to be dominant.

You're saying you're better than a dentist?

I mean, my dentist. Not every dentist, but yeah, I think I'm better than, like, my specific dentist.

Let's hope this pod stays niched. So Zach's going to walk in and have a handful of root canals.

Yeah, they're gonna be like, man, your teeth are really fucked up. We have to replace all of them.

You're an anti dentite, Zach.

Yeah, I am an anti dentite, Nikita. That's true. I am an anti dentite.

You heard it here first. We made it, whatever, 30 minutes without getting canceled. And here Zach is just railing American

Dental association about to cancel me.

You know, it's one of these things that's so benign and innocuous. And I guess I see the power dynamic element of it, but it's the same as basically saying whoever sends. If you have an executive assistant, whoever ccs their executive assistant first, you know, is a flex on the other person. I just don't see it as that big of a social dynamic power struggle. Also, like, people are busy, and this is. It's just an efficient way of getting to an answer. Right. If you're so caught up on the power dynamics, I feel like there was some business school book written about, like, how firm your handshake should be and when you should send the calendar link versus the other person. If you're like. If you're so caught up in this, I don't know, it feels like there's other stuff you should spend your time on. Shitposting on Twitter or whatever.

I actually like Calendly. Like, I appreciate when somebody sends me a calendly link. I would much rather just click it myself rather than looping in the admin, the other admin and going back and forth ad infinitum. And by the way, my favorite of these B school things, someone told me recently. Do you guys know this? You have to stand on like the left hand side of somebody. That's the power place to stand when you meet someone in a photo. I had never heard about this before. This is apparently like a well known B school bullshit thing.

And why is that? Is it like the primal instinct of sneaking up on them or something? Does this like go back to some root issue like in childhood?

This is like the intersection of like evolutionary psychology and people who should not be writing books. And this is where the root center of that is. What side should you stand on when you meet somebody new?

It's like when sapiens just goes off the rails. Someone read how society evolved and they started analyzing all of this stuff.

It's like if Jordan Peterson taught a B school class, it would be all about how firmly you should handshake.

Oh man. Yeah, that's good stuff right there. You know, I will say one of the interesting things of all of this is, and I imagine is going to be a recurring element of the different conversations we have is Marc Andreessen also weighed in on this Sam lesson thing and then proceeded to block Sam lesson, which is probably for another episode or something of Marc Andreessen and memes and blocks and all of this. I don't really understand what's going on there, but I think Sam's like best friend or one of his best friends is Mark Zuckerberg, who Marc Andreessen is on the board of. So just kind of a weird thing to call out someone's really good friend and then block him when you're on the board of this third person that is, I think, influential. Mark Zuckerberg seems somewhat influential in some circumstances.

It wouldn't be the first time. I mean, Facebook's the poster child of Web2 and Mark's been just railing on Web2 for, you know, know, he's taken the side in this war. So I think these sort of like incestual conflicts are here to stay with Mark.

I actually kind of appreciate it. Like I respect that this man is just happy to be messy the more and more powerful he gets. I hope we all hold on to that quality within ourselves and don't let ourselves be conflicted out of shitposting and stirring the pot five years from now.

Don't you think at some point people just stop telling you stuff because you've accumulated this amount of power, and you've had this level of success, and so you sort of get to do whatever you want. And no one's going to say, like, you shouldn't do that, Right? I've always seen videos of, like, Kanye west, and either it's in a private room and everyone's kissing his ass, right? And it's like, oh, my gosh, you are the best. Or it's like he's walking through a public place and people have their phones up in his face, like, you know, he's a zoo animal or something. And I can only imagine what a perverse worldview that would make you have is if those are, like, the two. You either get your ass kissed or you get, like, videos up in your face, right? And so, to some extent, I feel like Mark is just. He's just having a good time making himself laugh with all of this stuff. And he's at the uncancellable point. Like, who's gonna. I don't know who's gonna tell him what to do?

Do you guys remember how he just stopped tweeting for three years because of a comment about India? I'm glad he's back.

It's actually very interesting that, like, some misinterpretation of what he said. This is like rising from the ashes. It was some misinterpretation of some comment about India's Internet, you know, six years ago, or whatever it was made him take a hiatus, and now he's just going ham not thinking anything about what anyone's gonna tell him.

It seems like shitposting is what brings us all back to the Internet. Like, that's the highest form of being a billionaire, is when you start shitposting, and we can't take that away from Mark or Elon.

Well, it's sort of interesting. I hope one day that Mark does become the Kanye West. Logan, to your point, of the Internet, we see Kanye's photo shoot with Julia Fox from I did Ye I. That's. People who are listening should go look up this photo shoot and then imagine instead of Kanye and Julia Fox, it's Mark and treason. And that would make me very happy if you can create that mental image for yourself.

I really wish you hadn't told me those things. And now I have that image in my head here.

I'm already happy.

Yeah. I will say one of the most interesting parts of all of this is Mark has really embraced this blocking thing, which I'm not really sure what that is. At one point, he. He followed me on Twitter. And I'm not sure at what point it switched, but I looked one day and I was blocked by him, which is interesting because I never said anything directly to him. Clearly I said something that offended him in some way. Now, subsequent to it, I've made jokes, but at the time I hadn't done anything about it. So are you guys blocked? Followed, neither. What's your relationship with Marc Andreessen on Twitter?

Not blocked yet. I'm blocked by Chris Dixon currently. I don't know how that emerged.

Same, I imagine. Nikita. I think it was maybe our jokes about crypto, to be honest. Like, if I were to. If I were to guess the guy that runs Andreessen Horowitz's crypto fund. Now, to be fair, it must have been a random stray because I assume you never, like, added him about anything. Neither did I, but I commented on

a few of his tweets.

Got it. See, I never did that. I think I just caught a Logan,

you never made any injuries, Horowitz jokes before you got blocked?

I don't mark Andreessen jokes. I don't think so. I don't know. I mean, if I did, they were pretty benign. Like, they were, hey, we're all going to work for Andreessen Horowitz one day. Which, by the way, maybe joke, maybe thesis, but I'm not sure. I'm not totally sure which one that is.

But I'm still followed by him. Although I expect, frankly, after this that I will no longer be followed. At least no longer followed.

I will tell you, it seems like he brings people back into the fold. He unblocks Jack Dorsey just so he could make a comment at them. This could be. This could actually be my path back to his graces of Twitter. I will say, like, it actually used to not be annoying for me at all, but he's been so relevant these days. You guys will send a link about something and I'm like, fuck, I've got to log into like an incognito account just. Just to read this tweet. So I will say his end goal of like slightly inconveniencing me for whatever reason has actually worked out pretty well.

Well, there was a time when there was like a staged retreat from Twitter, right? It was like he was. Was very actively posting. And then he made the India colonialism comment and he stopped posting, but he was still liking all the time. And then there was a. He liked some right wing posts and a journalist wrote about it and he stopped liking things. But even when he was still Liking he was still pretty relevant. Like people will talk about, oh, you see Mark Andreessen liked so and so's tweet. And there was a bot that would just retweet everything he liked on Twitter. Even like when he didn't make a comment, he was still powerful on Twitter.

He didn't make that bot himself.

Yeah, exactly.

That's the Bolt CEO. That's the power PR move in all of this, is making the bot for yourself.

I will say, by the way, one more on the Bolt CEO. Someone just texted me this like 30 seconds ago. Did you guys see that he's apparently buying like paid media on random websites that calls himself a genius.

I did not see that. That's interesting.

It's just a very strange like between promoting his own Twitter account, like doing interviews or quasi interviews with like random, you know, no name publications, it's sort of a strange collection of self promotional behaviors. I think the good news is Marc Andreessen's not there yet. At least seemingly.

It will be interesting to see how all of this shakes out with Bolt specifically to go back to that. Just because all of those things buying ads for his name. I think he was buying Google Ads or something like if you searched his name for different posts and stuff. And so it'll be interesting to see if this isn't a good strategy ultimately.

Well, so so far I've taken away from this episode. Is Logan not simping for bolts, but Logan open to being hired by Andreessen? That was how I heard earlier.

That's right.

Aren't we all?

Speak for yourself, Nikita.

I will not. I am very happy with my current employer, Zach. I will defend where I stand on that line.

Just because they're listening right now doesn't mean you have to say that, Logan. They would never really.

You assume after the tweets I posted for the last two years that my partners are actually watching what I do? That is certainly not the case, let me assure you. The next thing that we had on our list to talk about is overall kind of the market meltdown. A little bit more of a substantive issue than these Twitter threads that we've been looking at. And ultimately, I think one of the lenses we want to take is not specifically to the public markets, but what that means for the world we play in. Right? As entrepreneurs, in Nikita's case, as investors and as shitposters, which we all are. The last three weeks has kind of been a. A up and down roller coaster in the public markets. I'm not sure if you guys have Any opinions or thoughts on that?

Yeah, I think this bubble had to pop. You had all of these kind of small cap tech companies trading at 100x sales and no one took the Fed's tapering seriously for a year until they just came out and said we're doing four hikes in 2022. And so immediately after that, everything long duration, all the growth, growth stocks, long bonds, they all just got crushed, including Turner Novak. I think his portfolio is down 50% right now.

Why do you say, why do you say Turner Novak is a, is a friend of the pod, if you will, and also a vc, also a frequent poster on Twitter. Why do you say Turner Novak's portfolios down specifically?

I mean he shares his portfolio once like a quarter.

Oh, you mean his public position. Oh okay, yeah, his public positions. Got it. Is it actually a joke when he posts them or these really his portfolio?

Some people commented is this a joke? But it actually, I mean it did well during the first part of COVID It was like probably the best performing portfolio that, that anyone had because he, he actually was in GameStop before the meme started. I guess he couldn't, he couldn't really, you know, rebalance out of that because his whole portfolio is meme stocks. And then this, this crash happened out of nowhere.

We love Turner, but unfortunately Turner Novak and Cathie Wood not doing so hot in the future, the future of markets. But does it feel like there's a bubble pop or is it a deflating? M.G. sickler, a good piece about this doesn't feel like it's a real pop. It feels like it's a slow sort of deflating more than anything else.

If you look at the historical trends of where these different software businesses specifically or even Internet business have traded, we're actually still at a slight premium to even some of the all time highs prior to the last two years. Now I will say these businesses are growing far faster than they ever had in the past. And so using a static revenue multiple, which is what gets used used most frequently for these high growth tech companies, using any point in time ultimately is not going to prove to be the most advantageous because there's different growth rates and ultimately this is a bet on the future. Right? Any investment is based on future performance. And so using this as these companies grow faster isn't the perfect metric. But it feels like we're within zone of historical trends in my mind right now.

Yeah, I don't feel like this is a bubble pop. If anything, it feels like we've slowly retreated back from complete irrationality. And by the way, like, here's the real question, right? When does it start to hit the private markets? And not the crossover investors who have huge public market exposure, but the true private venture investors, when does that start to be reflected?

It's an interesting point and a nice segue where it's starting to show up in the private markets. One of the weird dynamics of the private markets versus the public markets is kind of consensus based, right? It's a market that is liquid and two people agree on a price and it's constantly changing the private markets. Ultimately all you need is one person to agree to a price, you know, for the most part, right? And therefore that is the market price. And so right now, I think what we're seeing is there's kind of three groups that exist, right? There's the ones that are really licking their wounds because maybe their public portfolios way down and they're like not really sure what to do. Then there's a group in the middle that's trying to figure out price discovery and what is the new normal. And then there's a group that's saying, hey, you know, the music's still kind of playing. I'm going to keep dancing. And so I think all those groups, obviously the first one isn't doing anything. The second group is kind of feeling out, you know, what is the new reasonable valuation. No one wants to feel taken advantage of in that third group, like if you want to party and you want access to companies you couldn't have gotten access to in the past, they are open for the business. And if you wanted the price that would have been four, four weeks ago or whatever it was like, you know, you can probably have it. And that allows some of these not preeminent brands to get access to businesses that they wouldn't have otherwise.

I think the first thing that we're going to see though is churn at the executive level because all of these equity packages were granted at, you know, valuations that were 100x sales. And these executives are going to be down big as like once they start realizing that these companies haven't been mark to market.

And so Nikita, take us through like how that actually works, right? So you're trying to hire an executive. How does that actually work where you give them options and maybe just take through what the dynamic of hiring would look like.

Let's say you're joining as COO and you're given 100 basis points. Let's say it's like a $8 million package over four years.

This is, this is in your, your TB announced startup, stealth startup. Theoretically.

What you're missing in the package, Nikita, is of course the G wagon. You're giving all of your employees to

a big G wagon enthusiast.

So these are primarily growth stage companies that are months away from ipoing, like let's say up to 18 months. They're not going to get that price in public markets. And if they do another round, those rounds are going to have a down round. And so a lot of people switch jobs for that growth stage upside and that IPO pop. But if you're not going to get that IPO pop, I mean you're, you're taking a lot of risk. If you join a publicly traded company which already has been marked down, you actually probably have more upside, which is kind of backwards. It's traditionally been you join growth stage for that upside. So I, I think the churn will hit first. Then these companies might start underperforming because they've lost some of their top talent. Talent. And then I think investors too will ignoring even that. They're probably going to start paying less. I'm concerned there's like a negative feedback loop going against all growth stage companies right now.

Yeah.

I'll tell you, I think the companies that are probably going to be hit the hardest. Right. Earlier this year, if you were an average to even below average performing series B growth stage company, you could probably raise a FOMO driven round at not the best price and maybe not from the firm you're in love with, but at a pretty good price from a pretty competitive good firm. Right. And that category of like so, so performers raising early growth rounds, that feels like the crowd who are about to get crushed the hardest by this.

To me it'll be interesting though because so many of these VCs have just raised such big funds. And so yes, maybe you're right that it ends up hitting these, whatever the top 50% company instead of the top 10% company. Right. It hits that mediocre ish business a little bit more. But it'll be interesting because so much venture dollars have been raised that, that ultimately the job of VCs is to invest. And so I don't know when exactly all of this stuff's going to flow through. Right. It's very circular.

Well, the question is, do you rebalance? Right. If you're, you know, if you're a multi stage fund and you've raised a couple billion dollars and you have to deploy that capital. Right. The question is instead of going for the provenly mediocre growth stage company, do you then deploy far more early stage, far more in incubation, do you deploy where there's unproven upside and perhaps you can have better ownership instead? So that to me is like my expectation is not that venture activity slows down, that it just continues to accelerate the shift towards early and towards incubating because at least you can invest on potential there, not in a proven sort of, you know, number two winner.

I think what's going to be super interesting is the whole thing that flows through and just for a little bit of like the inside baseball dynamics, is it So a big LP will have a target of, hey, I want to be 10% in venture across everything, right? And I'll be 10% in real estate and I'll be be 30% in private equity, and I'll be this percentage in the public markets. Well, now when the public markets trade down the portion that they're exposed to venture, because there isn't mark to market there, the portion they have in venture has now gone way up and venture hasn't adjusted. And so they, they thought, hey, I wanted to be 10% venture, but public markets have tanked. And so Now I'm actually 15% venture. I'm 18% venture. And so when these managers go out to raise, in particular the tier two managers go out to raise again, the LPs that are giving them money are going to say, by the way, I already have too much venture exposure, right? I already, I wanted to be at 10%. Public markets went down. I'm now at 18%. I don't know what to tell you. We're not going to be able to fund your next fund. And so this whole cycle ultimately is going to lead, I think, to a washout of the average manager. We've seen it a lot over the last couple years. A bunch of funds like, haven't been able to make it. But I think that's only going to accelerate in this world of consolidating power.

Guys, how does it feel to be the toxic Asset Class of 2022? You're basically bonds in 2020. That's what you.

Well, hold, whoa, hold on. Hold the phone there, Nikita. I wouldn't say we're that bad.

We are enabling entrepreneurship and guiding founders to successful outcomes.

You ever heard of a little thing

called teachers returns below the s and P500?

Listen, not these two funds. Yeah, exactly.

Yeah, exactly.

Maybe.

Listen, by the way, Nikita, here's a question for you. You. So, Nikita, for folks who don't know, loves to tweet screenshots of his portfolio, but extremely out of context, screenshots of his portfolio, like, and also always with the.

Always with the balance, too.

It's like this Twitter version of leaving your receipt at the ATM afterwards. I'm like, all right, so let's. Let's talk about this. Nikita. This is not on the agenda we had. But I'm curious, like, what's. What's the. Give me the rationale behind this a little bit.

Well, I love trading. I haven't actually traded actively for almost a year since markets have gone sideways. I just got back into it, and I think there's just these black swan moments where it's actually kind of interesting to share what. What happened last week. I was trying to find where I should buy the dip, and I've always wanted to own Shopify. There was a 10% drawdown. And then I'm like, this is interesting.

I'll just buy.

I'll put in, you know, 50k into it. And there was a 20% delta within two hours. It was like the craziest trade of my life. So the rationale was, you know, it was a pretty unique situation, but also a flex, naturally.

Yeah, we have crypto. We have crypto enthusiasts listening to this, and they're like, wait, 20% in two hours? What don't you mean.

Don't you mean it's a two. It's a ten bagger in two hours?

Yeah, exactly.

20%.

20,000.

Did you lose money on that with the gas fees?

I was pretty impressed with that performance.

No, I will say like a stock with the equity value of whatever Shopify is worth $100 billion. I mean, Shopify probably gained $20 billion in value, which is. I don't know, what is that, like, two Dogecoins or something these days?

That's like. Yeah, it's 2G wagons.

2G wagons. Yeah, that's right. So shifting gears a little bit within this context, though, I guess elements of the market correction have started to show up in the private market. Fundraising. Now, it hasn't been all the way through, and I think different types of companies are going to be hit in different ways. Different calibers, different business models, different whatever. So our final topic here today was related to the market meltdown that existed in the public markets. The information had an article by Kate Clark and Berber Ginn entitled Tiger Global and Alkyon Slash Startup Valuations Amid Public Sell Off. So what's going on in the public market actually is starting to impact what's going on in the private markets, at least for a handful of companies in their fundraising, assuming their reporting is accurate, which I have no reason to believe it's not.

It's kind of a welcome relief. Like, I do a little bit of seed investing, and I'm kind of sick of seeing PowerPoint points valued at $100 million like a figma file at a.

Yeah, but what about a Pitch.com file that's worth the $100 million valuation?

Yeah, I, I, I don't know how

you make returns in this market like that, but as an upcoming founder, I certainly want you guys to value my company.

I was going to say we'll show. We'll show you the way, Nikita. We will show you how to make returns in this.

I'm going to make a really nice PowerPoint just for you guys.

A real slick deck. You should announce on the podcast what you're doing first. Like, we have to. There's been a tremendous amount of speculation about Nikita's next move, and I think we should tell people that they're only going to hear it here and they need to subscribe.

All right, Are you guys ready? Nikita's app cures cancer. I just want to put it out there.

Unless there regrows hair, I'm not interested.

That's. I think that's our best way to just, just really game engagement of our listener group. Like, even if we're mediocre and it's only our family members, if we just keep teasing Nikita announcement.

That's right.

I'm dropping next week.

Wow. I'm not totally sure if that's serious or not, but I sure hope it is. We say that every episode.

That's right.

I like that.

Every episode just end with Nikita saying, my new app is. And then we cut to black immediately. That's it.

I actually think that's a great. I actually think that's a great exit intro. But this whole show, honestly, I mean, to give you guys the actual inside baseball is a long con to get Redpoint and General Catalyst investors in Nikita's to be named company. So, so that's.

That's right. That's right. Wait, Logan, I thought this whole show was a long con just to hire me. Now I'm confused. There's a lot of long cons going on.

Oh, gosh. I hate when I put you both together. My, my rationale is. Is coming. Is coming through. It's like two. Two dating. Two girls, and they come together and figure out what's going on, which, in

case Tori is listening Logan is never done.

Yeah, yeah, that's exactly right. One of the interesting things though, about this, obviously it's not surprising that, that the hedge funds were the ones that do it. I will say in the venture environment there is this like, preciousness of, hey, you can't retrade. It's your word, your bond, right? Obviously the hedge funds, like they get mark to market every single day. They don't care about the preciousness of reputation and holding people accountable to what they committed to. For them, they're kind of like, this is no big deal. So I can't say it's totally surprising that this is the group that led with. I can't imagine you're going to see venture funds do this, at least in the, the near term. Now they might be more price sensitive on the way in, but these are basically unprecedented times that these valuations drop so quickly. And now there's going to be this discovering of the new normal, right?

I mean, if you have a 20 year track record in doing private stage, early stage, forever investing, and you're a traditional venture capital investor, the truth is that one, Logan, you're right, you're more insulated, certainly from swings in the public market, but also two, your reputation matters so much to the point we made at the beginning of the podcast about trust in a pitch, right? If founders don't walk in and feel like they can trust you, that's what underpins venture capital. There's no NDAs, there's no sort of legal agreements for most of these things. Even a term sheet is not actually a legal commitment to fund a company at any given.

I mean, word travels fast in this industry. And I don't think people that are new to the industry don't understand that, that when we sold to Facebook, there were a couple of our investors who wouldn't sign the merger documents until like they got some special deal. And then it was actually really illuminating. But all the major funds, like the storied funds, they signed the documents, no problem.

You can say Red Point. You can say investor in gbh Redpoint

signed investor TBH Redpoint held Nikita Beer hostage is how. Actually I heard that story until he got his own personal GWAC wagons sent to his house.

Zach, he said storied firms signed the documents very quickly.

No, but, oh, wait, is that point a storied firm? Now that's interesting.

It's 23 years of history.

Tier four, tier three. I was actually surprised, you know, like most of them, like the big firms didn't even read the documents. And that to me was a testament to how much trust they were giving and how much they wanted access to my next deal. And I certainly will come back.

These outcomes are binary for entrepreneurs. They can be very impactful as I'm sure joining Facebook was for you. But for VCs, it's such a hits driven business that for them there's no point in negotiating at the edges of these types of things it's like hey, it wasn't the $10 billion, $20 billion company we might have have prayed that it would be. This entrepreneur is going to do well. It's like why disrupt the Apple cart and all this, let's play the long game reputationally and just do right. Which I think is one of the best advantages of having good firms around the table is both they stick to their word on stuff because they are playing a longer game than any local optimization and then also they can hold downstream funds accountable to say if you do this, that's fine, you can retrade on this one entrepreneur, but you're not going to work with us again. Right?

But Logan, even understanding that to the point Nikita that you were talking about earlier, of course new entrants to the market know that reputation matters in venture, right? It's silly to say they don't. But Logan, to your point, there's a different value system in call it traditionally Silicon Valley based, SF based investors versus the kinds of New York finance folks who are working at a lot of the newer entrants of the market. Right.

And it cuts both ways by the there's a level of preciousness about like hey, this isn't the way things are done. And obviously it's historically been a very old white male industry and people were used to having the power. And so there's a lot of historical bad things associated with this.

But if you want Tiger to mark up your deals, you can just say that you don't have to do this whole offensive them on the pod.

Yeah, exactly.

That was it. Thank you for tuning in to the first episode of three cartoon apps Avatars. We're going to be here every week. Every week we will tease what Nikita's new app is. So tune in. For that reason alone, thanks for listening in.

I hope next week we'll have other interesting stuff between Twitter beefs of billionaires and blocking and memes and all that stuff, I trust that we most likely

will GPS and founders. If you're listening, this one's for you.

All right guys, this was really fun. I have to go to I'm in Miami right now. So I got to dip out to a panel that I'm doing, but I just wanted to get give you a quick clue on my app that I'm launching. It's going to be a.