When Ben Horowitz and his partner Marc Andreessen came into the venture capital industry, it was very different than it is today. You can argue that it is them, more than almost anyone else, that has reshaped this industry and matured it so much ever since. Andreessen Horowitz has become one of the most important institutions—not just investors, but institutions—in the private investing landscape, having achieved a scale that no one thought was possible in venture, which was always supposed to be this small, tiny niche corner of the world.
This conversation is a bit unique relative to some of the other ones that Ben has had more recently. I tried to understand the shaping forces and influences in his life and the ways that he thinks America most needs to change. He's taken this as his life's mission: to build a firm that affects outcomes in the country, not just in a small niche part of the market, but very broadly. We even discuss in this conversation his work with, say, the Las Vegas Police Department, which he's tried to infuse with technology to lower crime rates across the system. I hope you enjoy this great and wide-ranging conversation with Ben Horowitz.
I think a fun place to begin, Ben, would be your take on the state of the country. Like, what does it feel like to you in 2026? I know part of your mission is to directly impact the trajectory of the country—we'll talk about that a lot—but begin with what the landscape and the playing field look like to you today?
I think the tech sector is very, very healthy. America's competitiveness is very good. The entrepreneurship culture is outstanding, which you know, and that's the main thing I look at from my lens. If you look at it—and I go kind of all over the world—everybody wants Silicon Valley. "How can we have Silicon Valley in the UK? How can we have it in France?" The thing that's lacking... they have a lot of the ingredients right: they have great talent, they've got great universities. They have a definitely worse regulatory environment in the EU—an increasingly bad regulatory environment for entrepreneurship—but there's a cultural challenge where succeeding, doing something larger than yourself, making the world a better place... those aren't things that young people feel like society values.
And so the likelihood, if you're building a company, of getting people to kind of work for you and dedicate their life to a mission like that is just not that great. Whereas in the US, it's amazing. I think the economy is in much better shape than people realize and they're starting to see that. Well, we've done a lot of things to stimulate it: we've got lower energy prices, much less regulation, and a more user-friendly tax code. That's all starting to kick in now. And then, from our perspective, I think the bigger thing is AI—it's going to impact everything. There's almost no problem you can think of that you can't go, "Well, we have a real shot at solving that with AI." What were the big problems in the US? Auto deaths? Well, we've got an AI solution for that. Cancer? We have an AI solution for that. So the fact that we've got a technology where we can address everything is a real new phenomenon.
And all that's, I think, going to kick in in a fairly major way over the next 12 to 24 months.
Why do you think 12 to 24 months is a timeframe worth mentioning, that some of this stuff will start to be felt more broadly?
It's all kind of starting to take effect now and it's got to roll out and get deployed. Now, deployments of technology in particular in the past have taken a long time, but you had to build out the infrastructure to do it. So like for cars, you needed things like roads and traffic lights and all that kind of thing. And for the internet, you needed fiber in the ground and people to have smartphones; you needed to do a lot just to get going. The internet is here. So, if you want to use AI, if you want to apply it to your business, you just do it. Like, there is no infrastructure that needs to be built to adopt the thing.
What could most interrupt this good trajectory that America is on where we are building solutions using technology? Like, what are the biggest risks?
I think policy. One of the things my father said to me was a bad government—no matter how many smart people you have, no matter how great a culture you have, no matter how great the country is—can ruin the whole thing. Venezuela was the fourth richest country in the world. Crazy. And then like, communism, and that's that.
And if you look at how little comes out of so many of these countries in Europe that have so many smart people... and then the ones that went into communism. There's so many genius Romanian entrepreneurs like John von Neumann—and the number of great genius scientists that came out of Hungary, like this little country—and then it was just gone once the communists took over. It was completely like nothing; from inventing everything to nothing overnight. And I think that can absolutely happen here. We could outlaw AI. Like, I think there were pretty aggressive proposals. The last Biden administration executive order said that you could not sell a GPU without federal government approval. Like, that was a real executive order, and it got reversed. But we were that close to being out of the global chip game. So it is fragile.
By the way, technology solutions work much better than policy solutions. That's the other thing. Policy solutions are very hard to make anything work. So if you think about COVID, we could tell everybody to stay in their house—well, that's got some extremely bad side effects and turned out not to work that well—or we could invent a drug that cures it or a vaccine that works. It's just hard to have... or a policy solution like all the policy stuff on climate change, you know? Europe reduced emissions and all that, but it didn't do anything because like, China didn't reduce emissions. But if you build a technology—a really safe, efficient nuclear fusion facility—then that would have a big effect.
And I think in general that's true. And police... like, "Defund the Police" did not make anybody safer; technology does. And so if you really want to change the world, if you really want to make it a better place, I think you can build a solution for darn near anything. If you want to change the world for the better, it's never been a better time to be an entrepreneur.
I was with a local restaurateur yesterday here in New York—one of the best—for a couple hours, having him describe to us how he is planning on using AI tooling to improve everything about his restaurant business. How do you think about the way all of this is changing the sort of potentially large, attractive businesses that you want to invest in? Because stick with the restaurant example: Toast is a great company, there's many great companies that have been built in and around restaurant software businesses. It seems like this restaurant owner is going to be able to have his own spun-up operating system specific to him and is not going to need any of that stuff. How is this changing the way in which you view investment opportunities on the positive?
One, everything is up for grabs, right? I think people are kind of overreacting to that in the stock market and so forth, in that if you look at existing software companies, people think, "Oh, they're all dead." Well, some of these guys are extremely hard targets. It's not that easy to take out Salesforce or SAP. You would be surprised, even with AI, how much heavy lifting that is. Having said that, it is true that for a lot of these things, yeah, you can just make your own, you can do it yourself; it's going to be a lot easier. That's just... like the number of possible interesting companies I think went up a lot.
I think the other thing we're seeing is the products work so much better than any technology products we've seen in the past that revenue growth is so much faster for these AI companies. There's many such cases of companies coming out—Cursor, which is ostensibly an IDE... like, what was the biggest IDE before Cursor? I don't know, but it wasn't big and it took probably 12 or 15 years to get to that revenue level, and they went over a billion dollars in revenue in no time. So that's super interesting.
I would say though, from an investing standpoint, the laws of physics of company building changed, which is going to affect investing in what's currently, I would say, an unknown way. So if you look at the one thing you knew if you'd ever built a software company is you cannot throw money at the problem. Like, what's a man-year? You know, 700 IBMmers before lunch. Like, that phenomenon kind of... everything was built on that because you knew if somebody built a great product and it took them three years and they did it with a small team, Google's not going to hire 2,000 engineers and catch them. It's just not going to happen. That was a law of physics. Now, if you have the data and you have enough GPUs, you can solve damn near anything. And kind of we've seen that with Elon catching the big models in no time—he just took a lot of money and a really good data center design and some smart engineers. He's in the game; he got in the game very fast.
That would have never happened in the past. The markets also seem to be much, much bigger than anything we've ever seen. So it would cause you to think about valuations and long-term value and other sorts of things in a different way than we have in the past. On the one hand, it's like, well, when you calculate the long-term value, what if this market wasn't, you know, $50 billion? What if it was $5 trillion? And then on the other end, well, what if somebody could catch you? These are just concepts we've not dealt with.
So how would the conversations feel different to me if I came in? You've got all these great investors working at Andreessen Horowitz. What is the nature of the conversation amongst your teammates as they're debating this sort of stuff versus four years ago or something? Where does it feel most materially different internally?
I would say one of the most different things is when you look at AI researchers. It is really a different kind of thing. If you haven't been at like Google or Facebook or OpenAI or Anthropic and like somebody gave you hundreds of millions of dollars to try and build a giant model and you weren't like one of the main people, then you probably don't know how to do it because you can't learn it in school. And you can't learn it in school because it's a little bit alchemistic in nature; it's a little bit of an art. And so if you've never done it before, the chance on your very first try of building some kind of large model that's going to work well isn't that great. Now, people are coming up to speed more—there's more companies, people are learning it—but that's kind of why you got to this which, from the outside world, probably looked absolutely bananas: "Well, why is somebody paying a hundred million dollars for an AI researcher or a billion dollars for an AI researcher? Like, that's the craziest thing I've ever heard." Well, what if there were only 40 of them in the world?
And you have a $4 trillion company. Yeah, then it kind of changes the math on it a little bit.
And I think that's sort of where we were because it's kind of the first time we've had a need for a technologist that academia *couldn't* produce. That is kind of probably one of the bigger things that changed in the conversation: "Who are all these people?" Like, we track all of them and know what they're doing, but it's very different.
Everyone talks in venture about the power law. The thing underneath the power law is a sort of inequality. It seems like so many of the things that are happening are just massive multipliers on the trend of inequality in every way: the billion-dollar researcher, the size of the biggest companies, the wealth of the people creating those companies. I would argue that inequality is a feature, not a bug, of the American system. But yeah, I'm curious for you to riff on the nature of growing inequality and the good and the bad associated with that.
What's happening in AI is sort of, you know, I would just say an extension of the Kobe Bryant effect. You know, a basketball player in whenever James Naismith invented the game... there was a limited amount of money you could make because you played the game in front of the people who could show up for the game and that was it. That's the whole market. Whereas once you add television and the global audience and these kinds of things, you can get to a much bigger... you can be LeBron James, you can become a billionaire, and that just was not at all possible before.
And I think that we kind of first saw that with the internet where, okay, now I can build a product and I can get to global distribution very fast, and then all of a sudden I can become extremely rich. And then AI is another layer on top of that, in that, okay, now take that same product and make it just a more valuable thing, and so whoever invents that is whatever the internet company was plus-plus. And so that's going to make them even richer. That's the kind of "bad" part of it.
I think the good part of it is it's starting out day one like completely democratized. The AI—anybody gets access to very powerful AI, anybody who has a phone. And now most people in the world at this point have smartphones, and now you've got superintelligence in your phone. So that's an equalizer of the opportunity in a lot of ways. I don't think we've ever seen a bigger opportunity equalizer than AI, in that every child can have like a super advanced, amazing tutor teacher. So great education is accessible to all now. So I think it's an equalizing technology and there's some drive in inequality.
And this is another thing I learned from my father. He said, "Look son, life isn't fair," and that's extremely good advice because it's just not going to be fair. No matter what government or anything tries to do, it's not going to be fair. And the problem is, if you create a system that tries to correct that, it doesn't make things more fair; it just transfers all the power to the person running the system. And that's what happened with Stalin, that's what happened with Ceaușescu, that's what happened with Pol Pot, that's what happened with Mao. You know, it's not an accident that every single system like that went bad because it really ends up just being a power transfer.
When you think about, well, what do you want? You'd like everybody to have a chance. "Don't give me *no* chance. Give me *some* chance." Now, it may not be as big a chance as the other guy; it may not be like a perfect chance; but if I have the desire, if I've got some capability, give me a chance to be something, to make my imprint on the world. And a system like that is going to end up with a lot of inequality. All, by the way, all systems end up with a lot of inequality. But you can try systematically to give everybody an opportunity. And I think AI does a really good job of that.
One of the memes that's very popular today is that you have a couple years to get some capital or you're going to be a part of the "permanent underclass"—is the phrase that is used on Twitter. And I certainly agree that now everyone has the best lawyer, accountant, and advisor in their pocket, and that's amazing. But what do you think about this notion that we're going to need less labor? It's going to be harder if you don't have some capital to begin with to accumulate capital and break in. I don't necessarily believe that, I'm just curious what you think about the challenges we'll face because of AI society.
Yeah, I don't really think that's right. I don't think the door is going to close behind you. I think the opportunities tend to multiply when you kind of open up a new door and open up a new way of doing things. We saw that with crypto. So many people who made money on crypto were people who literally didn't have much to start with; they just got into the technology early and then they kind of parlayed it up. And so if you have something that grows really fast, that's the opportunity for somebody with a little bit of capital to make a lot of money because it doesn't take much. If you bought Bitcoin for a nickel, you did really well—and all you needed was a nickel. And that's the nature of these things that go hyperbolic.
And particularly if you create something... I also think the labor market stuff... I think people are acting as though it's very predictable and it's not at all predictable. So if you look at the history of the world and automation—and this is what it is, it's a kind of automation technology—we've been automating things since the agricultural days. And in those days, I think 95 or 96% of all jobs in the US were in agriculture. Almost all those jobs have been eliminated, and the jobs we have now, the people doing agriculture wouldn't even consider jobs. And so the idea that we could imagine all the jobs that are going to come, sitting here, that AI is going to enable... I think that's low.
I think the need for creativity jobs is going to go way up and the need for jobs to process work for the creatives will probably go down in some ways, but I'm not even sure about that. We've had AI going... right, ImageNet was what, 2012? And then natural language stuff like BERT and all that was like 2015, and then ChatGPT was 2022. Where's all the job destruction? Why hasn't it happened yet? And why are you so sure it's going to happen next? And why are you so sure no jobs are going to be created? I don't think it's nearly as predictable as people are saying.
How would you describe the nature and scope of your ambition over the next 10, 20 years?
One of the things that I learned... so I had a mentor who's a great CEO by the name of Andy Grove. He was the CEO of Intel and he famously did the major pivot of them out of the memory business into the microprocessor business—maybe the greatest tech CEO we've had. And one of the things that he said—which in a way is very obvious but I think is also profound—is: if you're the leader in the industry, then the growth of the industry is dependent on you. It's up to you to expand the market; nobody else is going to do it.
And so when I think about the firm, I think of it a lot in those terms. The reason America is America—and there's many narratives on this, but I think the factual one is like, we won the Industrial Revolution. We really did. We had Henry Ford and we had Thomas Edison. We had great entrepreneurs; they built great technology. The technology led to a military lead, led to an economic lead, led to cultural dominance. None of that was by accident. And had we not had all those inventions, had all those companies—which led to everything from winning World War II—we just wouldn't be... we'd be some other thing. We wouldn't be America.
So, we're there again. This is the equivalent change of the Industrial Revolution in terms of how everything works: governments, societies, businesses. And we're either going to be the leader of that technology, the provider of that technology, or we're not. And if we're not, we're not going to be the economic superpower, the military superpower, the cultural influence, the kind of standard of the world that we are now. At least I think that would be bad.
I think America's been kind of good for the world and good for giving people a chance like we talked about before. And so our role in that—trying to be humble with the role—but our role is, from a policy standpoint, from a funding standpoint, from a helping-people-build standpoint, to make sure that next set of great companies comes out of America or allied nations. A core ambition is to do our part in kind of helping that.
I want to ask about some of the ingredients to do that well, but just as a quick sidebar on Andy Grove: his book is incredible. Like, everyone should read *High Output Management*. What specifically did you learn from him? Like, what did you see him do that impacted the way that you think or behave?
Well, I'm so overly influenced by him it's hard to even pin it down. But so, *High Output Management*... I wrote the new foreword for it, which I think is the best thing I ever wrote. But the hard thing about... the reason I wrote that foreword was it was my favorite book, and I wrote *The Hard Thing About Hard Things* with the intent to be the updated version of it.
But the thing in *High Output Management* that he did so well that I tried to kind of do my own version of is: the concepts of management are easy. You need an eighth-grade education maybe to kind of understand management. It's not like physics. It's pretty simple. But the psychological part of it is extremely difficult, particularly for a young person to be able to do. It's super confrontational. You're having to kind of look through the conversation you're having to the entire organization. You really have to be Confucian at times: the good of the whole supersedes the good of the individual. And all these things are really complicated to do. His big influence on me was me trying to not only absorb that but then kind of tell it in a more up-to-date, modern way.
I went to visit him. He had this award on the wall which was literally "Manager of the Year" for the Santa Clara facility of Intel, and it was from, I don't know, 1992. I'm like, "Andy, you're the biggest CEO in the world. Why did they give you the 'Manager of the Year' award for the Santa Clara facility?" And he goes, "Oh man." He's like, "You know, Santa Clara was always... it scored the lowest quality scores, the lowest score on everything at Intel." And so I was just like, "I'm going over there and talk to them." So I go over there and he said, "I brought a roll of toilet paper and I put it under my desk, under my chair." And I said like, "When are you going to get this facility up to code?" And they just started in with all this bullshit, and I reached under my chair and put all the toilet paper up. I said, "Clean up your shit and tell me when you're going to be up to code." And in two months, they were up to code. And they were always the highest rated facility thereafter just on that. So they gave him "Manager of the Year" for that.
When did you first experience the lessons that drove his success—this confrontational, psychologically difficult aspect of management—yourself? How would you encourage other people to get a taste of it? You can't just read about it.
Obviously, what happens to founders is you invent something right now, and now I've got to build a company. You don't know what you're doing and you make mistakes, and then those mistakes really cost the company and you lose confidence, and that leads you to hesitate, and that hesitation is what kind of causes the failure mode. So then either the company's indecisive or they get very open to input from their team and their executives... but the team doesn't have the full context. Only the leaders have the context. So even if they're smarter than you, you still likely can have better judgment because you have all the knowledge.
But they defer. And then if you defer to people who work for you, then that kind of creates a weird political situation because people jump into the vacuum: "You're not making the decision, I'll make the decision." And then that feels political to everybody else. And so that's the pattern people run into. And so you really kind of have to build up enough confidence in them to have that confrontation.
The hardest version of this, by the way, is the reorg. Because a reorg is you're redistributing power to make the company work better, to have communication be better, to not have as much conflict. But what's going to happen is somebody who's really good, who you've had for a long time, is going to lose power and they're going to be pissed. And so then if you compromise the organization so they can maintain their power, then you've just kind of redistributed power from the people doing all the work to the executives, and that's a catastrophe.
So it's always that kind of thing where people don't want to have that confrontation. They don't want to tell that person, "Look, the organization's here. You helped us get here, but you either have to be happy in this new role or it's going to be a wrap." When you're young and inexperienced, it's going to hurt to tell him that. And I don't know... "It's going to help me to do this reorg because I don't... I'm not experienced enough to know that. I've never done that before." And so I'm going to go with the "known avoid hurt" to the "theoretical avoid hurt," and that's when you wreck your company. That's the pattern. And I always do my best to lend them my experience on that.
You were lucky that when you started Andreessen Horowitz, you and Marc had both had tons of operating experience both together.
Yeah, I still didn't know what I was doing as CEO.
Fair enough.
And he didn't know what he was doing either. Like his ideas now... if you ask Marc about management now, he's so different than how he did it. It makes him mad if you talk about it too much because he's like, "I got such bad advice. They told me to hire all these guys."
How do you think he's most different? Like, what would he say is—or what do you observe him to be—the most different?
I just think he's like way more in control of his own... Marc is a super emotional person, and he's just way more in control of it than he was then. Just in terms of the personality. He used to be like zero or 100, right? So he would be like full of emotion: "What the fuck are we doing?" Or like, "I'm just not going to say anything," but nothing in between.
Something I know the least about your firm is the first... I don't know what period of time... three days, three months, three years. I'd love to hear about how you thought about the business right as it was getting started. Of course, we're... I'm going to come back to what it is now and those ingredients you mentioned for having the impact you want to have. But Silicon Valley, Wall Street—these are institutions that make America great. Lots of people listening have ambitions to do this sort of thing, and I'd love to hear the very early primordial case study of what it was like, what kinds of conversations you were having, and what your initial ideas were.
So venture capital, first of all, you kind of have to understand the context: there hadn't really been new top-tier venture capital firms. So like, the last one before we started that you would say is top-tier was probably Benchmark, which ostensibly started in 1995, but it didn't really because all those guys came from another firm called Merrill Pickard. That firm was from the '80s and there hadn't really been a new one from the '80s. And if you looked at why, every VC was kind of reputation-based, and so to be top-tier you had to have invested in Apple and Cisco and Google and Yahoo and all the great companies. You can't from a standing start get to that.
And then if you're not top-tier in VC, you're not going to last because, yeah, in a super hot period everybody makes money, but the best entrepreneurs will only work with the top-tier firms because that's how you're going to recruit great engineers, that's how you're going to get follow-on money... everything comes out of that. So you'd never take money from a Tier 2 if you could get it from Tier 1. That's why the Tier 1s always have better returns. So we knew we had to be Tier 1, but we had that problem.
And the idea that we had was, well, venture capital is a great product for LPs but it's not a great product for entrepreneurs. And so, if we could build a better product for entrepreneurs, then we could win. And that was like the original framework. And the idea that we had for the product for entrepreneurs was around what you and I had been talking about: well, if you're like a founder who wants to run their own company, you're not getting much. You need so much: you don't have the confidence, you don't have the knowledge, you don't have the knowhow, you don't have the network. What if we built a firm that was designed to give you enough confidence, power, network reach, and advice that you *could* be a CEO? And so that was the whole idea behind the firm originally.
And then the second idea we had, which was the other thing: VCs didn't ever market themselves at all because if you're all based on your investing track record, it's best that it's just magic. Like, why say anything? Keep that a secret. And so they weren't talking. And so when we went out and talked, everybody covered it. So we instantly—everybody knew we had this product.
Where did the germ of that specific idea come from—let's be fairly loud relative to what others do from the very beginning?
Well, it's funny because Marc and I were talking about it. He said to me, "Why don't VCs market?" And the original thing went all the way back to the first class of VCs which were the investor-revolution VCs: JP Morgan, Rothschild, Goldman Sachs, etc. They were the ones financing these things. And it turned out that these guys were financing both sides of World War II, and so they really didn't want any publicity because that would have been an extremely bad thing. To a large extent, that just carried over all the way through Arthur Rock.
And then the reputation thing clicked in and it was working, so there was no need to do it. And we got a lot of criticism when we did it. Our LPs would say, "You know, the other VCs say you guys are egomaniacs. You name the firm after yourselves. You're marketing it like this." And it was so funny because the reason we named the firm after ourselves is when we tried... we raised money in 2009, which is right on the edge of the financial crisis. And the big objection from LPs was, "Well, you guys are like really good entrepreneurs. You're just going to leave this thing and go build another company and then we're going to be stuck with the fund." And we couldn't get them off of that. And so then I had the idea. I was like, "Well, why don't we just name it with our names and then they know we're safe." And that worked.
If you think about the period of takeoff of the firm in 2009 up until you reach, let's call it cruising altitude... when was cruising altitude and what was the most difficult part about getting it from takeoff to that point?
Well, the first thing is we really didn't know that much about investing. Marc and I had done some angel investing, but neither of us had any venture capital experience. And like, credit to Sequoia, credit to Greylock and Kleiner and all the guys who were around at that time: they just had years and years of doing it. We made more than our fair share of investing mistakes—missing things we should have done and then doing things that we shouldn't have done. Missing things that we should have done was probably the bigger one.
And then the other thing is that how we thought about the profile of the investor was wrong. We so over-indexed on our idea that we had to help the founder become a CEO that we made it a requirement that you couldn't be an investor at Andreessen Horowitz if you hadn't founded and/or run a company. And that was a very good attitude and set the culture of the firm in a lot of ways and had good things that came from it. But I would just say that most CEOs aren't as interested in investing as they think they are. And then also, most CEOs aren't as good at helping somebody else learn the job. And so those two things ended up being not quite correct.
So we made some adjustments. Fund I just went really well because we hit the scene hard. It was a small fund. We did Skype, we did Slack, we did Okta. Stripe was in there. There were just too many good things in a $300 million fund for that thing not to blow the doors off. Fund II wasn't as good as One. And then by the time we got to III, that's when we had the contention among... "Oh, we really don't have the right profile for GP here." And there was a while where we thought that was going to be a terrible fund. It ended up being a great fund because we had Coinbase and Databricks and Lyft and GitHub, but that one was scary for a while.
But coming out of that, we kind of knew what the firm needed to be. And so I think it settled down after that; it wasn't such a startup. It was like, "Okay, we got across that chasm." But then the bigger thing was we always had this idea about "software is eating the world," which Marc articulated really well in his 2011 piece. And so we always felt like venture capital firms needed to be able to scale, and that the other firms would have trouble scaling because of the way they worked—the way they shared control. So that could be an opportunity for us, but we hadn't figured out how to do it yet.
And then I'd say starting with the Bio and the Crypto fund, I started to get to the organizational picture of how we would be able to address every market of technology, but with investing teams that weren't 20 people—that doesn't work. So you need an investing team of like four or five people, but you can't address the whole technology market with five people. So you have to have multiple teams. Having multiple teams in a venture capital firm was a little bit of a novel idea, particularly when each team has like a platform that helps the founder build the company. And so we began it really in earnest with the Crypto fund, I think around 2018, and now the whole firm is kind of organized that way.
If we zoom to today and back to what you said, which is that the scope of your ambition is big: as the leader, be the one to help, be the ones that are expanding the market. What are the components of doing that? Like, what does the system need that it doesn't currently have that you might be able to provide?
One is the capital markets have changed dramatically with not much help. So, I went public at 18 months old with $2 million in trailing revenue. That wasn't a good idea. But companies used to go public routinely with $50 million in revenue; it was fine. Now, nobody's going public at less than a billion, right? Or something like that. And you're kind of small if you don't have that. And so you kind of need a lot more out of the private markets than VCs are built to do. So that's one of the things we have to think about.
Another one is the companies in the portfolio—they'd leave you at 100 million in revenue, they're going public, they're out to the races. Well, that's not true anymore. And so, what do you need when you get to be 200 million, 300 million in revenue? Well, you need to be multi-product, you need to be multi-channel, you need to be multi-geography. So as a venture firm, we need to help them, and as a venture industry, we need to help them do that. "How do I get to Japan? How do I get to South America?" Most venture firms don't provide much along those lines. So we kind of have to step up to those ideas if we're going to have companies in the portfolio at that stage.
Do you hope that over time your firm, and maybe some others like it that have become these big institutions and venture, go on to be sort of like the Blackstone/Apollo type companies that are big, publicly traded, enduring businesses?
A big huge wave among venture capitalists is private equity AI rollups. It's a good business idea—a really good business idea—which is, okay, just like the spreadsheet kind of created the original private equity business, AI is kind of creating a new private equity business where you can buy any existing company, optimize it with AI, and it'll be more valuable. That's a good idea. It's a good thing to invest in.
It's not something we're going to do for two reasons. One, it's like the cultural opposite of who we are. So, we're about building new things: growth, believing in the entrepreneur... price doesn't even matter. As long as the thing succeeds, you're going to do well. Private equity is like... entry price is key. I had a great dinner with Marc Rowan—who is a super genius, runs Apollo—and he was like, "Entry price, entry price, entry price." We never even think about that. We think about it, but it's not like first and foremost at all. We're thinking about containing cost and this and that and the other. That's just not what a good venture capital frame of mind is.
So culturally, I didn't want to mix those two things. But more than that, I just didn't want to be in a business where the way you make money is you figure out how to optimize an existing thing and lay off people and that kind of thing. We're about new technology companies, building the future, taking things forward, and I'll leave that to the other smart guys in the industry.
What, if any, trade-offs feel like they might exist at this scale? As you continue to scale, as you consider all these different people you're trying to serve—the investors internally, the LPs, the founders—so many people need... nothing's perfect. What are the trade-offs to the path that you've chosen?
I think with any scale of organization, you really have to over-pay attention to culture or the culture will drift. We probably spend more work on that than any venture capital firm. You're not allowed to join unless you sign the culture document. I spend an hour with every single employee teaching them the culture—it's that level of investment. And then we really try to enforce it hard when we can. We have pretty good consistency, but that is hard to maintain as you grow.
Can you teach me more about culture? You've written a book about it, you've built them, you've studied some very interesting cultures that you wrote about in the book. If you had to teach a seminar on what a culture is in the first place, how to design one given what you do and who you are, and then how to make sure people live by it?
Let me give you a small but probably the most important insight, which is from *Bushido*, "The Way of the Warrior" from the samurai. A culture is not a set of ideas; it's a set of actions. And so if you define your culture as a set of ideas—integrity, do the right thing, we have each other's backs, or any kind of these ideas—they call them "corporate values," it's just a bunch of platitudes. It doesn't mean anything.
The culture has to be defined in terms of the exact behavior that you want that supports that idea. What do you have to do to be that thing that you want to be? And it's the little things: how responsive are you to your colleagues? What's the SLA on returning a Slack message or an email? Do you show up to meetings on time? And this is like... not everybody has those ideas, but if you want that idea, it's got to manifest it through something else.
So, like, we have an idea about "you have to respect the entrepreneur." Well, what is that behavior? One, you can't ever be late to a meeting with an entrepreneur. I used to fine people $10 a minute in the beginning of the firm to reinforce it. And then you have to get back to an entrepreneur. If you say no, you have to say no. You have to explain why you're not investing, and it has to be clear. And we're going to survey that entrepreneur after you say no to make sure that you said no and that they had a good experience. So that's a behavior.
If you try to make yourself look good by making an entrepreneur look bad, you're fired. So like, you get on X and say, "Oh, he's selling dollars for 85 cents." No, no, no, no, no. We're dream builders. We're not dream killers. Somebody wants to do something larger than themselves, build a company, make the world a better place—we're for that. We don't give a fuck what the idea is, or if Sequoia funded them or whatever—we love that. That's who we are. And so the behavior is the culture—is the actual thing—and that gets you the idea, as opposed to the idea and then figure out how you're going to behave. And so that's probably the main thing on culture.
Can you say more about the influence your dad had on you? You mentioned that lesson of "nothing's fair" or "life isn't fair." Tell me about your dad.
Yeah. He was what's known as a "red diaper baby." My grandparents were communists. Like, they went to secret meetings, they had cards. My grandfather was fired during the McCarthy era from being a junior high school teacher for being a communist. And my father grew up a communist. And he started out on the left. He was editor of a very famous New Left magazine called *Ramparts* magazine, and he was involved in the Black Panthers with Huey Newton and the Oakland chapter, Eldridge Cleaver.
And he sort of dropped out of politics and he re-emerged, I guess probably eight years later, on the right. He really understood the ills of communism and socialism, which helped me a lot. Like, one of the things that he said to me that always stuck with me: "Son, go to the library, pick any book on socialism—there's hundreds of books—and in that book, I guarantee you, you will find page upon page, chapter upon chapter, of how to divide the wealth. You will not find a single sentence on how to create it." And I was like, "Oh, wow. That's not a very good system, is it?" I learned a lot about systems thinking from that, which I ended up being very helpful to me as CEO.
He wasn't like this New Age father. He wasn't like that. In the old days, your father wouldn't even talk to you till you got to be like 12, and then you get these little snippets of wisdom. And one of the ones I put in *The Hard Thing About Hard Things*... I had three kids, I was young, and I remember it was like 102 degrees, the air conditioning was broken, the kids were going crazy... like, one of them poured a whole bottle of apple juice—like a gallon of apple juice—into the rug. Apple juice is steaming out of the carpet. I'm just sitting there looking like I was going to die. And my father looks at me and he goes, "Son, what's cheap?" I said, "What?" He goes, "Flowers. Flowers are cheap." I said, "Okay." He said, "What's expensive?" I said, "No, what?" He said, "Divorce." And he had been married four times, so he knew what he was talking about.
As you look out today in the world, I'm curious what things are captivating you most and maybe even most inspiring you. You have such an interesting perch; you get to see so much at the frontier.
What's going on in coding now is quite phenomenal. We kind of went through this period where like, "Okay, AI can write code, cool. Okay, you can vibe-code stuff with a lot of security holes, fine." But I think over the break—over the winter break—it turned a corner where really, really good programmers were going, "Whoa, oh god, this helps me." Like, "I just became a hundred times more productive." And I can't remember any technology where just, all of a sudden, you wake up and everything, the whole world, just changed like that. And that's happening on a pretty regular basis, I would say.
And then we spent a bunch of time with people in Hollywood who are using AI. I think AI will help you make movies both better and at much lower cost because you can shoot a scene and then have the AI do a variation of that scene. That's very good. And so you don't have to do the really... like, if you're an actress, you have to shoot a scene like 15 or 20 times or something. Wouldn't it be nice to shoot it three times and then you just take the pieces you like and make it what you want? So I think it's a little underestimated as a tool for creatives.
I think that's true in music, too. I was a young person when hip-hop started, and the huge criticism: "This is not music. They're just taking music and they're remixing it and they're rapping over it and it's a novelty." But it was postmodern art, and I think we're going to get into postmodern art with what people will be able to do with AI and music. And that was one of the most exciting times in music. The invention of the new art form is when it gets really exciting.
What people in hip-hop—specific people—have had the largest impact on you personally, and how?
Nas is a very good friend of mine and he's definitely had a big impact. Just the lens through which he sees the world is so different and interesting for me. We're both very big fans of Rakim, who is kind of like the John Coltrane of rap. Rakim had one of his first big songs, a song called "My Melody." And Nas and I are listening to "My Melody" and the first line is "Turn up the bass, pull up a chair, hand out a cigar, I'm letting knowledge be born." And so he puts it on, "Hands out a cigar," and he pauses it and he goes, "Ben, why is he handing out a cigar?" And I go, "I don't know why." Then he plays the next line: "I'm letting knowledge be born." And he's like, "It's a birth, Ben. He's passing out cigars at the birth of knowledge." And I was like, "Oh, I listened to that song a thousand times. I never heard that."
I can't tell you how many times he sees or hears something that's there that I don't see. So having somebody that I can talk to who has just a completely different perspective of all things in life... and it was interesting, we did the Coinbase deal together. He had called me like two weeks prior to us really seeing that because he wanted to learn about Bitcoin. So I explained to him how it worked and he was very interested. And then when I was talking to Chris Dixon, who was working on the deal, I was like, "Tell me about the guys." And he's like, "Well one of them, Fred, is really into hip-hop." I was like, "Okay." And so I brought Nas over... I said, "Have him come over to my house. There's a boxing match on Saturday." I had Nas come over and that's how we got that deal.
Wow.
But yeah, he's just a big influence on me personally. And then he's such a... as a leader, storytelling is important to me, and as a writer. I think he's one of the great storytellers of all time—just a super genius on that.
Is there a CEO comparable to Nas? There's this class of guys in the '90s where Jay-Z—"I'm not just a businessman, I'm a business, man"—and there were these massive franchises that were born. These guys all became incredibly successful in the business world. And it felt more industrialized, almost like the whole process. Whereas Nas... even just his album that just came out, it feels just like *Illmatic*, feels like it could have come out then or now. It's like this weird timeless quality. He still has that somehow. And Premier, same thing. Does anyone else like that in another domain? He seems like such a unique person relative to his peers.
Maybe Jensen [Huang] has this very defined—agree with it or not—but it's this view of who he is, what the company is, and so forth that's kind of gone across eras. But it's still the same thing, right? Like, it's not that... it played in gaming, it played in Bitcoin, it plays in AI, but it's still Nvidia. He never thought he had to change the name of the company. He's gotten better over the years, but in a weird sense, it never felt like he's trying to be "current," which Nas never feels like—he's never trying to write a "hit."
Can you tell the story of the work you're doing with the Vegas Police Department? And I'm asking about this one because it's super interesting, but also because it feels like a different kind of example of what the application of this constellation of new technologies might allow for in terms of improvement and efficiencies. It's just such an interesting case study.
A couple things about the Las Vegas police force were intriguing to me. The biggest one was they were different than other police forces in the country because they're a big metropolitan area that's not run by a Chief of Police, but run by the Sheriff. And the reason that's important is the Sheriff is an elected official and does not report to the Mayor. So they never got caught in the big political movement and "Defund the Police," and they were one of the only cities that didn't reduce the police budget or anything like that.
So they kind of stayed intact and they're also, interestingly, one that I knew that never militarized. They do community policing, and you can see it in the numbers. The murder clearance rate in Las Vegas is the highest murder clearance rate—meaning they solve the murder—at 94%. I think San Francisco is like 75% and then Chicago's like in the 30s and the national average is below 60.
And I asked him, I said, "Why is your murder clearance rate so high?" And the Sheriff, Kevin McMahill, said, "Ben, when somebody is murdered, there's always somebody who knows who did it. They just don't talk to the police. But they talk to us because we're part of the community. They know us." And so, I was like, "Wow, that's a great environment to see if this new technology worked."
And I knew about all the public safety technology because we invested in it through "American Dynamism." So I was like, "Look, we're going to become the highest-tech police force in America, hopefully the world, and I'm just going to fund it." And so I bought... we've got a drone program, and we've got Prepared 911, and we've got Flock Safety AI cameras. If an emergency call—if a 911 call—comes in or if a gunshot goes off, there will be a drone deployed in there within 90 seconds. And then that drone video feed will be in every police officer's phone in the vicinity instantly.
Since we started the program, I think crime is down over 50%, and then shooting of suspects by police is down like close to 75%. Everybody's safer. And I think this is the thing that was the most surprising to me on the technology deployment: when you talk to the police, they go, "Look, the problem is the descriptions cause like half the violent confrontations." I'm like, "Well, what do you mean?" So somebody jacks a car. There's a baby in the back seat. We get a description of the car: it's a 2004 Hyundai that's blue. Well, it's really a 2008 Hyundai that's green. But we pull a guy over in a 2004 Hyundai that's blue, and that person has had bad experiences with the police, and now he's got a gun in the car, and all of a sudden we've got an incident and like an innocent citizen gets harmed or police gets shot.
With an AI camera, we know that's the car. That's it. And we know there's a baby in the car. And so we're not sending one guy with a gun to see if that's the guy; we're sending a whole squad, and we're apprehending them safely. And so everything about policing is inherently dangerous, but intelligence makes it dramatically safer. And so I'm a huge believer in this technology for making everybody safer: suspects, criminals, citizens, police, everybody.
The other knock-on effect is it's kind of put the pride back into policing. We used to have a big problem in Vegas where, because nobody wanted to be a police officer, we were lowering the standard. But now the standard is really high. So between the drone center, which is like super state-of-the-art, and then you have these Cybertrucks that look so amazingly futuristic and cool driving around... everybody wants to be a police [officer] now. And Las Vegas happens to have the highest concentration of veterans in the country, so plenty of super qualified people to choose from. They all want to be police. So that's all gone really well.
The last question I ask everyone is the same. What is the kindest thing that anyone's ever done for you?
A mentor of mine, a fellow by the name of Ken Coleman, who was a big executive at Silicon Graphics... when I was, I guess, a sophomore in college, I got an introduction to him and he gave me a job as a summer intern. And without that job, I don't know that I ever get to Silicon Valley or that whole thing. So I would say that was probably the highest impact. He didn't have to do that thing that he did for me.
It may interest you that is the most common form of answer across 500 of these: someone that took a bet when they didn't need to. Ben, pleasure to finally do this with you after a couple years of watching you and learning from you. So, thank you so much for your time.
Thank you, Patrick. It was fun.