Jason Calacanis on why the traditional path to wealth and homeownership is disappearing for millennials, especially in Silicon Valley. He covers startup advice like talking to customers, his angel-investing record, and how AI threatens white-collar jobs.
Chapters
Talk to your customers.
No, I totally agree. Your time and your mind are the only 2 things you truly have, and that's it. You waste them and that's gone. So for those of you who are watching Silicon Valley on Friday or Saturday—
There's an argument to be made that that shows you what not to do. There is. There are some things in that. It's scary how accurate it is. I mean, it's about 84% accurate right now. They came to my poker game. I've talked to some of the people who write on it. They're like, hey, tell us the craziest things that have ever happened. I'm like, absolutely not, because I've seen some crazy stuff. Like, no thank you.
No thank you.
Yeah. They've gotten a couple digs at me on the show, I understand. I'm just too unaware of them. But you remember the guy who runs the incubator? What's his name? He's no longer on the show now. Ehrlich. You remember Ehrlich did the Hawaiian party and he was saying mahalo over and over?
I don't watch TV.
Everybody remember that? Well, I had a startup, Mahalo, which is now Inside. Supposedly that was a dig to me. It was like, let's make his startup a Hawaiian-themed party and he keeps saying mahalo over and over again to kind of stick it to Jason's biggest failure in life. Well played. What was it? Well played.
What is your biggest failure in life?
My biggest failure. Well, There's so many. Where to begin? You know, 9 out of 10 of the startups I invest in either return zero or 1x their money.
Mm-hmm.
So objectively, looking at my angel portfolio of 125 investments, investments, I'm going to guess 110 will be zero. But 6 of them are unicorns right now. I just found out in the last 60 days that 3 more companies I invested in turned into unicorns. So I've got a 1 in 21 hit rate. kind of never happened, I think, in the history of Silicon Valley. There might be— Chris Sacca and Ron Conway are the only 2 people ahead of me, maybe Esther Dyson too. So I'm objectively number 5, maybe 6, in terms of best angel investors of all time. The difference is everybody else has quit and they're no longer doing it, and I'm doubling down and going harder.
Right.
So I think I have a chance to be number 1, and that's what I'm working on. That's why I wrote the book, was the book was my way of saying, I have some level of expertise on this after 125 investments and a ton of mistakes. I'm gonna share every secret I know. And it really is for founders too, to understand how angels make decisions.
Right.
And how to behave and how to really hack the system. So there's a couple of chapters in there that are targeted at entrepreneurs. But really, if, you know, 100,000 people read the book, which might be realistic, and 10,000 of them try angel investing and 1,000 of them start doing it for a living. Can you imagine my deal flow? And what if, like, one of them sends me a unicorn or every year somebody sends me a unicorn? Yum, yum. So the whole book is a front to inspire people to become wealthy, powerful angel investors to increase my deal flow.
And scouts. Why not?
And scouts. Exactly. Well, the truth is, if you think about how wealth is created, how many people here are over the age of 30, like me. Raise your hand if you're over the age of 30. Raise your hand if you're under the age of 30. Okay, so you didn't lie. Okay, so it's about— for people who are watching, it's 80% millennials and, you know, 20% people who are not millennials. The millennials grew up at the tail end of a great lie, and the Gen Xers, we were fed something that was true that became not true, which is wealth is created by having a white-collar job and buying a home. How many people heard that story? Raise your hand if you heard the story, like get a white-collar job and try to buy a home and that's how you get rich. It's not true anymore because to get a white-collar job, you have to go to college and get debt. Now you're $100K in debt or $200K in debt.
Mm-hmm.
And then you graduate and the average income for 2 people here in Silicon Valley or 2 people in New York or Austin or anywhere in the country might be what? $125K household income. Maybe if you're doing amazing, $200K.
Mm-hmm.
When our parents grew up in the '70s and '80s, the cost of a home was 1.5 to 2 times— 1 to 2 times, actually. In some places it was 1 times your household income. In other words, in today's world, if you had $125K to $150K in household income, a house would cost $125K to $250K. Anybody see a $150,000 house in Silicon Valley? Can anybody in here on their salary afford a home in Silicon Valley? Raise your hand if you can. Nobody's hands are raising. The dream is over. There is no way for you to use that hack.
Mm-hmm.
That hack is what our parents used. Many of our parents bought their houses for $70,000 and they're now worth $1 million, right? And now it's over. You're coming out of school with $100K in debt. It takes you till you're 35 to pay it down and your income is 1/10 of what it costs to buy a home. That is no longer available to anybody or almost anybody.
Right.
Maybe if you work at Google on some rare technology and they give you $500,000 a year and your spouse has a similar situation and you have $1 million, then 1 times the cost or 2 times the cost of your household income would be $2 million. it actually would be possible. And that's why the only people who live in Palo Alto right now are Googlers and people at Facebook, because they probably have $500,000 RSUs and they probably think, well, I mean, it sucks to buy a $3 million house or $4 million house, but we can, we can swing it.
Right.
I mean, it's just the American dream's over. Now we add to the American dream that all the white-collar jobs in the world are going to be attacked by AI and machine learning. So I'll ask another question. How many people in this room have a job that would— they would consider harder. Your job is harder than beating Garry Kasparov at chess. Whose job is harder than beating Garry Kasparov at chess? Your job is. Okay, one person. So I guess he wrestles bears for a living or something. He's a bear wrangler. But the truth is, only one person. Now, is your job harder than beating the 5 best Go players in the world? in a game of Go? Top 5 Go players. So he says no. Okay, so somewhere between Kasparov and 5 Go players. We'll find out your job afterwards. I really wanna know.
