On this episode of Okay, Computer, Dan and FirstMark Capital managing director Rick Heitzmann discuss if the Fed will start easing rate hikes with signs of moderating inflation (2:00), Thoma Bravo and other private equity giants on the hunt for valuation opportunities in tech (7:30), Sam Bankman-Fried’s indictment and FTX’s collapse forcing a reckoning on due diligence in venture capital (8:30), how entrepreneurs are getting ahead of the curve despite market uncertainty and volatility (15:00), and if we’ll spend less time talking about Elon Musk in 2023 (20:00). Later, Dan talks with NEA partner Ann Bordetsky about her transition from high-profile consumer brands to venture capital (26:30), her experience working at Twitter and her “unpopular opinions” about its future under Elon Musk (34:30), the huge differences between working at Uber versus Twitter (46:30), finding the magic formula for successful consumer companies (54:30), and why TikTok is a perfect showcase for where consumer habits are headed (58:30).
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Show transcript:
Dan Nathan: [00:00:38] Welcome to Okay, Computer. I am Dan Nathan. I am here with Rick Heitzmann, my co-host from First Mark Capital. Rick, welcome back to Okay, Computer. [00:00:46][7.6]
Rick Heitzmann: [00:00:47] Welcome back. Happy holidays. It’s the most wonderful time of the year. [00:00:50][2.7]
Dan Nathan: [00:00:51] It really is. You know, yesterday I get home and I see this thing, it doesn’t even fit in my mailbox here it is like literally like a two by four of chocolate that’s marked with first mark, happy holidays, that sort of thing. I’m just saying to myself, what is he trying to do to me? You know, so my goals, you know, so my goals for 2023. [00:01:08][17.4]
Rick Heitzmann: [00:01:09] It’s not 2023. This is the holidays is the holidays you ramp up. If you ramp up to ramp down, it’s a time of celebration. [00:01:17][7.7]
Dan Nathan: [00:01:18] All right. Well, listen, you know, I could eat. [00:01:19][1.3]
Rick Heitzmann: [00:01:22] Chocolate fondue, chocolate ice cream top and just chocolate with chocolate. [00:01:24][2.0]
Dan Nathan: [00:01:25] Well, I could I could eat it every day for the next, you know, like three months. And I won’t finish it. But thank you to to my friends and and listen. And I do want to thank you very honestly for for your participation on okay computer this year we’ve had a really fun year doing this. We started it, I think all the way back in January. And you and I’ve been kind of plug it away. We’ve had tons of great guests that that have been in the First Mark, families of our mutual friends, all of our co-hosts throughout the years. So thank you to you and our friends at First Mark. And just, you know, you and I going to talk about a lot of things tech. There’s been a couple of fun things I feel like we’ve bookended this year with Tomo Bravo taking some big SAS companies private after Rick and I talk all things tech that’s the here and now I am joined by Ann Bordetsky. She is a partner over at NEA. That’s New Enterprise Associate, a venture capital firm. She’s also a former operator. She was the chief operating officer at Rival, which sold to Live Nation. She’s worked at Uber. She’s worked at Twitter. We got a lot to talk about, so stick around for my conversation with Ann, but we got to talk about this. Let’s start with this, Rick. You know, if you’ll like in January of this year when we started okay, Computer, I think you were very much in tune with the fact that there was going to be a bit of a sea change from a top down sort of macro thing. And that was going to be the Federal Reserve here in the U.S., their change of interest rate policy. They had signaled in November of 2021 that they were going to be raising interest rates coming up, this zero interest rate down. They had this very accommodative monetary policy where they were buying $120 billion worth of bonds each month. Right. So that what they were trying to do, they were trying to stimulate whether they be businesses, whether it be individuals to kind of go further out on the risk curve and spend. And then we had this unusual bout of inflation, 40 year highs. The Fed said we are done with easy monetary policy and we’re going to raise interest rates. And at that point, it was like literally to the day the Nasdaq and public markets topped out. And then you and I were talking about what is the lag? When will we start seeing this work its way through the private market? So talk to me a little bit about it. 2022 has been very volatile. If you were to look at the Nasdaq and say down 26, 27%, not so bad. It was up at least that in 2021, right from here on out. How does this play out? [00:03:47][141.5]
Rick Heitzmann: [00:03:47] So we’ve been talking for a little over a year now Dan we it was I think it was a guess even before we kicked off OKC in earnest. Then we were concerned. Even going back to our times on CNBC together of two years ago, we were concerned that the party may have been raging too hard and the hangover was going to be pretty bad. And we we were very concerned in the summer of 2021 that that felt very toppy. And then when things started to crack a little bit around this time last year, in the fourth quarter, we said, you know, put your seatbelts on. This is going to be a rocky road and it’s not going to be over overnight. We were quick to call that this is going to be a fundamental change and the boom, boom days of zero interest rates are behind us. You know, I think sadly, we were right in May. It was one of the worst years for asset management in a long time, only 1 to 5 years since the Great Depression, where both stocks and bonds were down. You know, what’s happened is that, as always, the the the the public stock market reacts quickest because the feedback loop is the shortest. The private markets, there’s just a lag I mean, there’s partially a lag because Silicon Valley, which is still where most of the assets are held, is about 3000 miles away from Wall Street. And therefore, the feedback loops different and they’re less asset management focus as opposed to thinking about maybe other things out there. So that feedback loop isn’t as harsh. And, you know, so therefore, where are we today? And, you know, we’re on with our good friend Scott Wapner last week of, you know, how have we gotten to halfway across the lake and are we at a good place right now as we think about it? And maybe we’re in the fifth inning, sixth inning in the in the public markets, and that it feels like we’re bouncing around a bottom, that the best companies will bounce out of that bottom quickly. Maybe some companies that aren’t as good might stick on that bottom or even have a step down as. Some of the companies still haven’t done the basics that we talked about in the beginning of the year of profitability, cash efficiency, unit economics, that you need to be able to explain your business either to a kindergarden or to a public market analyst, why you exist in the world. So in that world has changed, but I think that the lag in the private markets is still there. The canary in the coal mine is always IPO listings. It’s been a disaster of a year from that perspective, as you and I spend a lot of time both at the Nasdaq, the New York Stock Exchange. It looks like first quarter is not going to reopen. You know, I think the optimists are saying second quarter, you could start to see some high quality public financings at a not a premium price, but at least that will begin to have the mechanics of the market moving. Although the IPO market has generally been shut this year may be different than prior recessions. We’ve seen is the private equity buyers have kind of stepped into that breach and have been the buyer of last resort or the fallback option. If someone put their hand up and saying, well, at this price I’m a buyer. [00:06:41][173.9]
Dan Nathan: [00:06:41] So that’s a great point. I think we started this year, one of our first pods we were talking about this I think was a $30 billion fund that Tomo Bravo raised right, right out of the gates this year. And then they started putting it to work. And, you know, you just use this expression buyer of last resort. I think they were being really opportunistic. Right. And so this week we see a huge deal, an $8 billion deal for a company that I think at its lows is Coupa software was down more than 60 some percent, but they’re buying it at a premium of like 50% or so, more to the lows that it was just trading in the public markets. So talk about that because again, this seems like opportunistic capital being put to work and especially because it was raised at a time where interest rates are pretty low. They’re probably seeing what they think are some pretty unique valuations at this point. [00:07:29][47.7]
Rick Heitzmann: [00:07:29] That’s exactly what they’re saying. And there’s some large funds. You know, there’s the Vista and the Tomo Brava really focused on technology, especially SAS software. But then you’re seeing the traditional buyout funds, the Apollo’s the KKR, Apollo did famously the Yahoo deal, KKR, Digg, GoDaddy and a number of other software companies from a buyout perspective. And what they’re seeing is the multiples have gone down and off, prices have gone down enough that these are really attractive assets and they’re actually willing to pay premiums to the existing multiples. And Coupa got a little over eight times revenue, which is a premium about 40% to where the SAS index trade on a next 12 months basis. So what you’re seeing is, hey, there’s someone stepping into that breach and saying, hey, these are good assets and they’re cheap and I’m not going to let this fall. I’m going to take advantage and be aggressive in what they believe is an oversold market. You know. [00:08:21][52.2]
Dan Nathan: [00:08:22] Here’s another thing. It was a theme that we started talking about in January. I think it was our very first pod. It was called Sins of Bad Due Diligence. And I was quoting something that [00:08:32][10.3]
Rick Heitzmann: [00:08:33] They quote that in one of the FTX articles, I should’ve trademarked that [00:08:37][3.5]
Dan Nathan: [00:08:38] Again, this was January 5th of 2022. We were talking about maybe valuations that were being paid or, you know, market opportunities that were not probably picked over particularly well. And here’s a situation and again, you and I have been through different cycles in markets, right? We saw all these kind of bullshit ideas in the late nineties that had a lot of money thrown at it. Maybe they were just kind of too early, or they just had some hucksters running the shows. We saw all that stuff implode and then there was stuff that rose from the ashes, right? And then into the financial crisis, into the the housing thing, there was all these kind of Fugazi stuff going on. And every step of the way there is fraud uncovered after you have a bubble kind of inflate and then burst. And so here we are. Last night, Sam Bankman-Fried, he’s finally indicted. A lot of people were wondering how he could not have been already. And when you think about this and you look at the sort of VCs and the sophisticated investors in attacks and how little due diligence they did on the guy on the business that they were supposedly building on the tech. We’re kind of bookending some stuff here. So. So talk to me and then do you think this is just kind of like the tip of the iceberg? They got a big whale here, but might there be a lot of minnows, you know, swimming below the water? [00:09:54][76.1]
Rick Heitzmann: [00:09:55] You don’t know who’s naked until the tide goes out. I think you’ve seen the tide go out. And now some of those chickens are coming home to roost. Two completely mixed metaphors of, you know, hey, you’re seeing which companies didn’t really have it now that you’re really forced to perform. And it could be complete frauds like FTX who seem like they had momentum. And if you didn’t do diligence, it was easy to lean into what seemed to be, as Fortune magazine called it, the next buffet or the next Berkshire. Or there’s some business models that just didn’t work. If you look at the consolidation and, you know, the existential crises the fast delivery workers are doing or, you know, where all the scooter companies are today. That would seem like an irrational business model at the time. But people pour billions of dollars into both those business models and it might not exist in the future. So what you’re saying is, hey, people didn’t care about things like unit economics, long term organization and industry structure, and people didn’t really care about even the folks that they were investing in. I think that that lessons being learned in a very harsh way as you’re seeing some venture firms, to their credit, stand up and apologize in The Wall Street Journal to their investors for not being as diligent as they could have hoped. A lot of firms are still hiding. But I think you’re going to see these lessons being learned. And I think you’re probably going to see a few more business models, companies and even firms fall victim to being too lazy about due diligence and being driven by FOMO and not fundamentals in their 2020 and 2021 investment decisions. [00:11:31][96.9]
Dan Nathan: [00:11:32] Do you think there will be any meaningful changes in VC? I mean, again, these are some storied franchises investing in this sort of thing and losing money. And to have that sort of come to Jesus and outright apologize, you know, the VC model, I don’t need to tell you about it. If you have a few dozens things hit in a fund, that’s how you make your bones. That’s how you make your returns. So you’re wrong a lot. That’s part of like the kind of embedded structure of the process here. But to lose money in a way that just seems like you’ve just abandoned all of the fundamentals of what you do to actually have fraud perpetrated on you for not asking the right questions. It seems like it’s going to lead to some sort of like wholesale changes in VC [00:12:14][41.5]
Rick Heitzmann: [00:12:15] So do you give me a little inside baseball? Even if we talk about it internally here at First Mark, you know, there’s a million different ways to lose money. Some of them are fine. An industry might take longer to develop. There might be a orthogonal risk that was unforeseen. But not doing your work, not doing your diligence, that thinking through the risk factors going into an investment are kind of less forgivable sins. So that’s very clear across the industry within a fund and it’s incredibly important if you’re going to be an investor of other people’s money. So that’s that’s really important. Some firms had gotten away from it at a time where things got very overheated. And I think what you’re going to see is two things. You’re going to see firms are going to persist. And Sequoia Capital is an amazing firm. And I would give them my money tomorrow if they would take it despite some of the chop recently. They’re they’re going to be fine. They’re going to persist. They’re one of if not the best venture capital firm in the world, but they might change some policies. And then you’re going to see probably half of the venture firms cease to exist. And they’re either companies that didn’t do the work, did poor work or just got unlucky, and they just can’t return capital based on how hard they might have been leading into 20 and 2021 and either the prices they paid or the companies they backed. So half the firms go away. And I think the firms that remain are probably going to remain because they were more diligent and because they were more thoughtful. And that’ll reinforce those ethos. [00:13:39][84.0]
Dan Nathan: [00:13:39] Here’s something that from a venture capitalist I think is going to be around for a little bit as a friend of both of ours, Jeff Richards at GGV. And he tweeted this out earlier and I thought, this is kind of interesting. 2022 Headlines. Innovation in Tech Is Dead, he says. Q Chat.GPT Breakthrough, etc.. Innovation doesn’t take a break because interest rates went up. So let’s let’s talk about that because, again, I think a lot of us in public markets, like me, in private markets like you, we spent a lot of time on the volatility, right? A lot of macro. And it’s easy to kind of overlook some of the stuff. The people that you invest in who got heads down building, they don’t care where interest rates are. They don’t care where the Nasdaq is. They don’t care what some goofy pundit has to say in a podcast or some showing on CNBC or something like that. They’re just building. Do you try when I think about your diet as as it relates to information and what you’re taking in the people that you’re talking to, you do try to just drill down on some of these things where three weeks ago no one was talking about chatgpt then last week everyone’s obsessed with it. It’s all over Twitter. I was at dinners with like these folks and they were never where they were substituting conversation that we might have over dinner with where we we do this and then ask it this and then this and being really entertained. And you can see all of the potential innovation disrupting so many different industries and then this fusion thing. I’m just too dumb to get any of it, but I’m sure it’s going to be a big, big thing. Talk to me a little bit about that, because sometimes it’s really important to separate the forest from the market trees. [00:15:15][95.3]
Rick Heitzmann: [00:15:15] I think the two things you hit on were completely right that great entrepreneurs don’t really care about anything else except pushing forward their idea. You know, Ben Silbermann at Pinterest founded Pinterest, quit Google right after the fall of Lehman Brothers and said, well, you know, that was weird, that it seemed like the economy’s falling apart and you’re leaving one of the strongest companies in tech. And he said basically I have to start this company. The best entrepreneurs aren’t looking at market. Timers are looking for momentum and frankly aren’t looking for validation from anyone else to say now is the right time and that’s that’s who we’re looking for now. The second piece is how do you get ahead of the curve and how are you thinking about tomorrow, even even if today doesn’t seem that bright? We’ve been looking at AI and especially generative AI, which is kind of the subsector you’re talking about for years. So we’re been investors in instant this year for three or four years. We investors in hyper science, we think about processing, document processing, text based processing. So we’re constantly looking at where that edge is. And I have the benefit of having some great partners who are looking at all different sectors. We all stay up to speed because we’re investing for the long run. One of our Keith Maddox is having the longest view in the room. In the longest view of the room, innovation matters. And longest view in the room, innovation wins. You have to pick your time. We you buy and sell securities along the way. If we’re helping people build companies, they’ll continue to build companies regardless of economic environment. [00:16:44][88.9]
Dan Nathan: [00:16:45] Let’s just say at some point in 2023, a lot of these kind of macro headwinds that have caused a lot of volatility in both public and private markets, let’s say it comes to an end at some point. Right? And we enter this kind of new bull market. We enter a period where financial conditions are a bit more conducive to company creation, value creation and the like. Okay and if you go back and you think in the wake of the financial crisis 08 09 the convergence between mobile social broadband, you’ve talked about it a lot. We’ve read a lot about it. And you just think of all of these amazing companies that were formed in that time period. Are you optimistic that let’s assume that we find some sort of bottom within the next 3 to 12 months or something like that, that we will have a ten year period like we had coming out of the financial crisis. Like we will look back and say the pandemic bore this sort of innovation or this whole group of companies. [00:17:41][56.2]
Rick Heitzmann: [00:17:41] I think there will be something I don’t know if it’s the pandemic. I think it might just be the business cycles. When you look back at the late nineties and that’s probably the closest we see to this in the late nineties, a lot of things were funded because capital was free in the Internet sector then. So you’re going to see a lot of companies that were seeded during the pandemic when there was tons of money floating around that you made. It might have never been funded based on fundamentals, but those entrepreneurs had an opportunity and they’re going to grow great businesses. You know, it’s funny, some of the seed funds I knew from back then went out of business, but they had a couple of great companies in their portfolio that they didn’t even know at the time. You’re going to see that again. Just the amount of people who got their shot at entrepreneurship in the last two years is awesome and you’re going to see some amazing entrepreneurs out of that. And then I think you’re generally not riding necessarily an event driven wave like that. You’re probably riding more of a secular wave, but probably the most important thing is you’re writing a technology with the technology wave that people were writing then was omnipresent broadband. They were also riding the wave of mobility, right? So everybody now had a computer in their pocket. And I don’t think Steve Jobs was necessarily concerned about the interest rate environment when he when he delivered the iPhone. So I think there’s a couple of different things that which can be that new new platform. I think generally I and some of the things were going on and I really interesting, really exciting. I think there are some things going on in health care and financial services on the consumer side, which are interesting, exciting. And I think you’re going to see new platforms and new business models emerge from that, which a lot of people are going to wish they spent more time on instead of licking their wounds in 2022. [00:19:22][100.3]
Dan Nathan: [00:19:23] Last question before we get out of here, because again, we’ve spent a lot of time on okay computer talking about Elon Musk, the Musk empire. And just as we were talking about SBF, I mean, the cult of personality that is surrounded by him and everything he touches. And going back to that whole situation of you see who’s, you know, swimming naked when the tide is out. I feel like a lot of the stuff in and around him, the worship of innovation and his ability to kind of do things that supposedly no one else can do. It seems like it’s coming to an end. And I just wonder when I’m not saying he’s coming to an end. I’m not saying Tesla is coming to an end or SpaceX or anything like that. But the worship of him, it seems like the premium for the companies that he’s helped create is coming out as it relates to him. So I’m curious, will we be spending a lot less time in 2023 talking about Elon Musk? Because I really feel like he dominated both private and public market conversations and then dictated a whole heck of a lot of other conversations as it relates to media and politics. And to be frank, it seemed very unhealthy. And so how do unhealthy things find some sort of, I guess, conclusion? You almost have to have a bit of a bloodletting, so I’m just curious. [00:20:35][72.9]
Rick Heitzmann: [00:20:37] Yeah or people you have to get sick of it. Right. So I think, you know, people were wondering 24 months ago, can he really run two big companies in both Space X and Tesla? And then maybe he flew a little bit too close to the sun trying to run three companies and going from being an incredible engineering big brain who is focused on interplanetary travel. Rare earth materials to power a car to being a media celebrity clearly has 131 million followers I think on Twitter, you know, about a third of the whole Twitter population is following him. And it’s very different designing rockets to being clever in 140 characters. And so I think that eventually people are going to be worn out by that. Differently than you I think he’s actually going to do a pretty good job running Twitter. I think there’ll be a tremendous amount of controversy as he takes away things like the Safety Council. And he’s done some things that were almost illogical, extreme of his own beliefs. So I think it’s going to be jagged and you’re going to see stuff pop up in the news all the time. But I think Twitter will persist. I think there’s such a network effect there. It’s going to be hard for it not to persist. But I think at some point people are going to get tired of talking about Elon Musk. And I hope that there’s going to be more interesting, more positive, better stories in 23. [00:21:54][77.0]
Dan Nathan: [00:21:54] Yeah. And I just want to make one point. I’m not trying to correct you on here. You just refer to him as an engineer and, you know, insinuated that he’s like a rocket scientist. He is not that he is not an engineer, not a computer scientist. He’s not a rocket scientist. And despite him trying to do a lot of fun stuff on Twitter as it relates to geopolitics, he’s not a political scientist. So this goes back to the point about due diligence. People have been throwing their money at Elon Musk for 12, 13 years or so. And I think this is the sort of reckoning, all of these jack offs who put their money into this Twitter deal to help support his equity, to be along with him at $44 billion. They’ve just incinerated it. Right. And what are the bankers doing who are holding the debt that they basically pledged to him, you know, six or seven months ago? They’re trying anything to get out of that for him to kind of basically pay it down. [00:22:46][52.1]
Rick Heitzmann: [00:22:47] It’s very true. You’ve been you’ve been saying it for months that they’re obviously his bet on Twitter is a lever bet on Tesla, which is trading at incredible multiples. So once there you see a crack in Tesla and things start to go down, his effective margin on Tesla is going to create a huge contagion and it’s almost unfair to the Tesla shareholders that he’s doing this stuff, which might be too clever by half, you know, is already happening. If you see the value destruction in Tesla. [00:23:14][27.1]
Dan Nathan: [00:23:15] I’ve been saying this for a while. I don’t think he’s going to be the CEO of Tesla for too much longer. I doubt he’ll be the CEO of Twitter, especially if you given what’s going on with the company, what’s going on with the user base, what’s going on with the advertisers. So I suspect he’s just going to be the CEO of the private company Space X in 2023. We can do whatever the hell he wants. All right. Listen, Rick, I really appreciated this conversation, your insights, all of your contributions to okay computer in 2022. And I really look forward to a great 2023. [00:23:42][27.0]
Rick Heitzmann: [00:23:44] Look forward to 2023, everybody. [00:23:44][-0.5]
Dan Nathan: [00:23:44] All right, man. Thanks. Alright, stick around. Ann Bordetsky from NEA joins me in just a minute.
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Dan Nathan: Welcome back to Okay, Computer. I’m Dan Nathan I am joined by Ann Bordetsky a parter at NEA, and welcome to Okay, Computer. [00:26:22][157.9]
Ann Bordetsky: [00:26:23] Thanks Dan. Thank you so much for having me. I’m excited to chat with you. [00:26:25][2.3]
Dan Nathan: [00:26:27] You know, you and I did one of those things where we had a chat a couple of months ago and we’re like, you know, this would be a really good podcast. And those are like the best guess when you just kind of meet somebody. And just full disclosure, good friend of the pod, Sally Shin, made the intro. I was just really excited to speak to you. You’re a storied career in tech, in business development, at Twitter, at Uber at Rival, which I got to know a little bit there. To me, I love those career arcs, I’m sure being in and around Silicon Valley and operating at those sorts of places. I’m sure you are very familiar with the VC business, so I’d love to know indeed what led you there, what led you into the VC business? Because you’ve been there for what, at NAE for almost a couple of years. I’d love to see how you got there. And what are some of your initial impressions? [00:27:17][50.2]
Ann Bordetsky: [00:27:18] All credit to Sally for introducing us. When I met Dan, it was like, How did we not know each other before? There are always the best moments. Look, I spent most of my career building venture backed startups right at various stages. Some were very pioneering kind of category, creating before their time. Companies like Better Place, which is focused on EV charging, you know, long before EVs were cool and hypergrowth, companies like Uber, Twitter, you know, really kind of iconic consumer products, consumer brands. And I would say like my thread line throughout my career has been I am really drawn to innovation that fundamentally improves and kind of disrupts industries for the better, and that can come in many different forms. But, you know, I want to move the needle in the world, right. And I think one of the best ways to move the needle in the world and have impact is to build incredible products that people love and use and that make our lives better. Right. And there are many different ways to do that. So after trying my hand at building startups in a lot of different ways, you know, I think it was kind of a natural transition to come to the investor side of the table. I will say, though, I feel like I joined at the craziest time possible really. I mean, I literally entered institutional venture. I’d done some angel investing before, I’d been around venture. I had kind of an idea of it. I think I even had like an internship and venture back in the day in business school. I joined the very peak of the market and I came into venture. I just thought, This is wild. This is absolutely wild. I mean, rounds were getting done incredibly fast, right? No one was taking time to get to know each other. It was just like a transactional volume game. You see a lot of companies try not to miss out, go, go, go, very FOMO driven, very frothy. And as a former operator, I was like, I was kind of cringing, you know, like I had the cringe face of like, oh, this is not going to work out well because, you know, investors and founders were literally not taking the time and effort required to get to know each other, to figure out if a foundational relationship was going to be an enduring partnership that could serve both sides. A lot of things just seemed a little bit like, whoa, this is going to catch up to us in some way. And now, I don’t know, 18 months later, almost two years later, we’re like, Oh shit, we’re in a total market downturn and reset. And I kind of think I got to see both the peak and the trough within a very short period of time, not to mention the pandemic itself and how disruptive that was to our ecosystem. So it’s wild, but, you know, it’s a great way to learn a lot in less than two years when people ask me like, Oh, what’s it like to be in venture? Like What’s going on? And like the best analogy I can come up with and I keep going back to this, it’s like we’re living the movie The Hangover in the peak good times. Everyone went to Vegas party, did things they shouldn’t have done, took too many shots, you know, not literally, but figuratively, and then wake, you know, the entire sort of ecosystem. Woke up the next day, like bruised and battered, which way is up and what happened last night. And I think in a lot of ways we’re going through that process now as both investors and founders. Gosh, like where are we? What happened and how do we move forward from here? [00:30:36][198.1]
Dan Nathan: [00:30:36] Well, well, let me know when you get the digital camera with all the pictures in the post-credits scenes of The Hangover, because that that is going to be some good stuff. You know, you and I were going back and forth on email after our first conversation. I noticed that in your like digital signature on your email, you have a link to Ann’s user manual. And it’s pretty fascinating stuff because I love it. You talk about right out of the gate and I’m assuming that this is for entrepreneurs that you’re having conversations with who are pitching you or maybe they’re your portfolio companies. But and the communication segment, it said, please bring the energy. Then it says, I’m direct. I ask a lot of questions and then you like clear and concise communication is highly appreciated. I’m like, Wait. Is this a user manual for a podcast? I’m like, What? You know, like we’re kind of going down parallel. [00:31:24][47.3]
Ann Bordetsky: [00:31:24] Maybe. [00:31:24][0.0]
Dan Nathan: [00:31:25] I really I really like that. But talk to me a little bit. Let’s let’s take a step back here, because you talked about these life changing sort of businesses. You want to go after the big stuff. And I think about the first two companies when I look at your CV here and, you know, Twitter, and we’ve all obviously spent a lot of time thinking about it, probably more so than we want to of late, especially in the tech community. But was it like joining a company like that? Let’s think back in 2013, and that must have been right around the time that they went public, you know, they were boring, you know, very similar to what you just described as kind of born into a boom period, into a crash period, and then really coming out of the financial crisis in those years and confluence from a tech perspective of mobile social broadband. You guys were like a rocket ship out of the gate. [00:32:14][48.1]
Ann Bordetsky: [00:32:14] Yeah, and that’s exactly what I want. And I wanted to join a rocket ship. I wanted to see and feel what it’s like to build a rocket ship, hypergrowth company. And at the time, I mean, Twitter was an incredibly special place, not only like the hottest consumer product out there, but just the power of a product that was part of the world and reshaping the fabric of the world and providing a platform to people. I mean, I think now that we’re all sort of co-creating Twitter every day as we participate in it, we kind of forget how special it was at the beginning to create something that was truly a public square where a politician and a celebrity and a normal person and just anyone could connect all across the world. I mean, it was amazing. And so what originally drew me to join Twitter was the fact that it was clearly a very special product that was going to be important in the world. And the people at the company really saw kind of the broader mission of opening up communication globally. I joined Twitter because there was an amazing opportunity to join the business development team, be part of building Twitter commerce, which at the time was Twitter’s early attempt to sort of diversify away from an ad based revenue model and to create new business lines that could fuel growth, fuel revenue expansion for the company as it went public. And it was really competing with Facebook, right. For scale and for investor confidence. And so here’s the thing about Twitter. It is and I think this is universal across many Twitter alumni, no matter which chapter you were a part of, it was very clear working at Twitter that the company was magical but also chaotic and in some ways represented the product itself, very vociferous company culture. Everyone had a voice, but it was really hard to get alignment, really hard to get things done, and very precious about the timeline in its current form because there are a lot of sacred cows and things you couldn’t do, things you couldn’t touch in service of product innovation. And so I think as I look back at it now, Twitter has always had so much potential. And I think in some ways as a company’s underachieved its potential, it’s still very important in the world. But it doesn’t surprise me that someone like Elon could come along and beyond that, being kind of his play thing, really believe that this is a product that one could be a lot more innovative, could have a bigger place in people’s lives, and a platform that a lot more people could use around the world because the active user base for Twitter is still only around 300 million people. I haven’t looked at the numbers recently. Right. And so compare that to Facebook, which is one and a half billion, 2 billion at this point, active users across all the different platforms. And so, you know, Twitter as a company is definitely underachieved its potential. But it was always a very special place with incredible people who really, truly cared about the fact that it wasn’t just a company maximizing profits, but that it kind of represented a public good in the world that people counted on a space for for open communication. [00:35:09][174.9]
Dan Nathan: [00:35:10] When it’s all said and done, I mean, clearly, Elon is the villain in this chapter of Twitter right now. But I think a lot of people are going to look back who have a similar sentiment to you and just saying how special it was and the potential for it and how underutilized it is by the world’s population. I mean, there are 8 billion people in the world. You know, most of them are connected over the Internet, yet there’s 300 million or so monthly active users on this platform. When you look at Facebook, that has a third of the population who use this thing. And obviously, you know, Alphabet has like six or seven properties with over a billion users. And the problem that I have is like you had to look back. I mean, really, I think the probably the most innovative period when it reached some sort of scale was in that period that you were there where where the company had gone public. Right. And they were trying out a lot of new things. And it seems like every single new product offering fell by the wayside. Whatever it was, if it wasn’t digital ads, it wasn’t going to be the thing that won out. And then you go back to that same. Recall of the timeline and it didn’t speak to product innovation. And therefore, a lot of people, if you were in tech or politics or sports or entertainment, a really hard time figuring out why they might use this product like, you know, you know, over the years they sent some tweets to my parents and things that I thought they might be interested in. They had no idea how to access that information or whatever. Elon I’m not a fan of Elon and I certainly know dozens of ex Twitter people and very few people have been that kind of outward, you know, about their opinions, about what’s going on. But to say the least, I don’t think anyone’s particularly happy. I think Jack did a tremendous disservice to the company, the platform, its ability to grow it. Once he got into this Bitcoin rabbit hole, I think he thought of it as a protocol that as a company and to be frank, he was running it into the ground. I mean, so it was right for an activist to take it over. But the fact is, I don’t think, Elon, you might try to innovate on product. He has definitely made the whole platform a lot more divisive. I think you would probably agree and we could say, well, it’s only been a month. I just don’t see it getting a whole heck of a lot better. And I think that [00:37:23][132.8]
Ann Bordetsky: [00:37:24] I don’t know, I have nothing but unpopular opinions when it comes to Twitter and there will probably be even more unpopular. [00:37:29][5.1]
Dan Nathan: [00:37:30] Let’s hear them. [00:37:30][0.4]
Ann Bordetsky: [00:37:33] Because I don’t think that this view is uniform by any means. And by the way, I have a lot of empathy for the people who just left Twitter. They were affected. It’s like someone came into their home, set it on fire. There’s a lot of anger, there’s a lot of resentment. I understand where that comes from. And I have empathy for that, for sure. You know, things could have been handled a lot better by Elon. But, you know, I think the underlying premise that this is a platform where work that is not yet done in terms of product innovation is correct. Right. And so I think if he is able to attract the right kind of talent going forward, like my two biggest questions for him are essentially like, can you get amazing people to come join and build with you now, right now that you have control, now that it’s a private company, now that you’ve done the culture reset, right, change management is hard, but he’s doing it his own way and like it or don’t like it. Like the question is, can you get amazing people to come join you and innovate from here and to like, can he grow as a leader, as a founder, as a CEO, to really navigate what it takes to again, lead a company that is essentially a public good and that’s how people see it in the world. And there’s a special responsibility that comes with that. And it means operating in a lot of gray areas that are really uncomfortable and not so clear cut. And you just have to embrace that. He has been very. [00:38:57][83.5]
Dan Nathan: [00:38:57] Well who who who has to embrace it, because at the end of the day, he owns this thing. He took out $13 billion in debt to buy it. He sold it tens of billions of dollars of Tesla stock to buy it. He put a bunch of his pals who just like being in his ecosystem to kind of help him on the equity front. But if you think about what he’s done in a month, he paid $44 billion for this thing. You already had a 9% stake. It’s probably easily worth half of that right now. And then when you look at some of the public comps that are trading that monetize better and they’re obviously relying on advertising, they’re trading at a much lower valuation. So to me, for his ability and you just said, is this public utility or this public good or whatever, that doesn’t speak to being able to kind of bring this thing back out in a way that the financials or the economics work where it’s going to be something that’s going to be able to self sustain, you know what I mean? Because just the natural forces of gravity are going to financial gravity are going to come to play. [00:39:58][61.0]
Ann Bordetsky: [00:39:58] The fact that the world views Twitter as a public good, a public square is exactly why the company is so challenging to lead. And not anyone can just come in and do it, including former founders. Right. So, you know, I think that the reality of Twitter as a consumer product is a lot that Twitter can do from here in order to create more interaction with the platform, increase engagement, unlock new use cases. And I’ll just give you some examples like one super obvious one. We have this discussion so many times a Twitter was investing in DMs, investing in DMs as one of them mainstream chat app app. When WeChat was emerging and Facebook Messenger and Snap was coming on the scene, there were a lot of opportunities in the past for Twitter to truly invest and build out the direct messaging experience, right, and make that a first party experience in the product. And that hasn’t happened before, right? I think Twitter is a place where creators like yourself and others congregate. There’s a lot more that you can do to give creators the ability to create video and streaming and distribution through the platform. Right. Like this is all product innovation that is not so radical, but I think infused into Twitter could give it new life. Give it value because I think what you’re really fighting with Twitter is the decade of consumer behavior that you’ve trained on the platform, which is like, hey, we’re entitled to be here for free, right? And we don’t really want things to change. And we kind of have trained users into that mode. And now we’re introducing change. He’s introducing change and people don’t like it. But the thing that I think all Twitter employees, former alumni can agree upon is that any time Twitter did anything, it was wildly unpopular. Like there was no way to truly ever please the broader user base because it’s so diverse and it’s so mixed and there’s so many different ways that people derive value from the platform. You’re never going to please everybody. And so he’s definitely a bull in a china shop. Like, you don’t have to be a jerk to be a CEO. And I think we should hold him accountable for that. Right. But I understand why someone leading Twitter might say like, look, I’m going to set a direction, I’m going to try new things. And if it’s unpopular, that’s okay, because it’s very hard to innovate from a place of, you know, like let’s just make sure it’s non-controversial. [00:42:19][140.1]
Dan Nathan: [00:42:19] No. And that that makes perfect sense. But you just ended that with non-controversial. He literally tweeted, Follow the Rabbit, which is a Q&A on dog whistle today to his 130 million followers. I mean, it’s turning into a thing by the time the next time that you and I pod, I mean, like this is going to be a very different situation. It’s going to be out of his hands as it relates to advertisers and the sorts of organizations that actually want to use the platform. And when you think about the DMs that you just mentioned, I mean, Facebook, they bought WhatsApp for, what, $22 billion in 2014. They’ve never monetized it. Okay. And they’re going to have to figure out ways how to monetize it. You’re telling me, given the low sponsorship and the poor engagement, that Twitter on its very small userbase relative to Facebook has, that they’re going to be able to do a better job just because Elon’s in there? I don’t think so. You know, I think he’s got a lot of challenges. And I again, I think [00:43:12][52.7]
Ann Bordetsky: [00:43:13] I think there’s no point in setting the house on fire completely. And that’s that’s a bit of what he’s doing, right. There are things that are working. The advertiser relationships are important to the company. The organizations like people have to be feel good about being on the platform. And that’s what I mean when I say like, you don’t have to be a jerk to be a great entrepreneur and founder and CEO. And I think he is basking in this reality TV show that he’s created for himself. And it’s very it at least appears from the outside in to be very self-indulgent. That’s really dangerous because it will alienate people and it will alienate people who can come and help build the company with you. [00:43:52][38.2]
Dan Nathan: [00:43:52] The talent pool that he has to draw from right now is fairly well divided, and that’s not a great way to build. I mean, I think you would agree a world changing sort of platform where you can have billions of people, not just hundreds of millions. [00:44:05][13.3]
Ann Bordetsky: [00:44:06] But I’ll just say this one last thing on Twitter and I’ll talk about anything, anything else quietly. When you talk to people behind the scenes, you know, even extreme sort of Elon fans, I would say. I think the question and the thing that does not sit well with a lot of different people is, you know, I mean, like in tech, is he surrounding himself with the right people? You know, it does seem like there’s a few people with very loud voices who are very influential on him. And I don’t know if that’s true or not. I don’t have any visibility on the inside. But oftentimes when you’re a very successful founder CEO, you have to surround yourself with people who will truly challenge you and listen to them and allow yourself to be challenged. Right. And if that’s not happening, it usually starts to go sideways. [00:44:48][42.3]
Dan Nathan: [00:44:49] I suspect that’s not exactly happening. Let’s talk about this without going in-depth about it. It’s probably far less controversial. But you were at Uber again, a hypergrowth, a very disruptive. [00:44:58][9.1]
Ann Bordetsky: [00:44:58] I can’t believe you just described Uber as far less controversial. I’ve never heard that before. [00:45:04][5.6]
Dan Nathan: [00:45:05] But it’s funny, you know, well, no, but the period in which you were there in the lead up to Travis leaving in 2019, I feel like a lot of folks were really embracing this changing technology unless you owned a bunch of taxi medallions, you know what I mean? Like it was something that people thought, here’s a confluence of technologies that really could make a whole heck of a lot of things better. Right? And so when I think about the narrative and this was one that was really easy for anybody to kind of just kind of conceptualize, here’s your car. Sitting in your garage is used about 3% of the time. Here’s an app where you can trust, you can put your credit card information. It’s really slick tech. They know where you are. They know where you want to go. They’re going to get you there safe and it’s cheaper. And it was going to change the way cities were built. It was going to change the way transportation happened. It was going to change everything. Then the pandemic, it’s like lights out, right? And that is something that happened to a lot of different industries and then the whole narrative changed a bunch. And so here you have a company that was growing. It was never profitable. It was not expected to be profitable for a very long time. But losses obviously ballooned. Revenues went to zero. And then it started growing again. We opened back up. And it’s funny from an innovation standpoint, there hasn’t been a whole heck of a lot there, but the path to profitability better speed up because we talked about the market to start this conversation a little bit. It’s pretty unforgiving for money losing companies, even though that they’re growing. That’s something of the past, right, if you think about it, especially in a rising rate environment. And so I guess my question to you is, when I think about what you’re charged with, doing it any way you’re thinking about things, the future of work, you’re thinking about marketplaces, and you think about SAS. And a lot of these things that were probably pillars of the Uber story from the early days into this hypergrowth. Talk to me about some of the things that remind you of Uber that that come across your desk, some of the entrepreneurs that you meet, some of maybe it’s more like the Maddox. What are some of the things that you think are going to be the sorts of Ubers of the next ten years? [00:47:06][121.5]
Ann Bordetsky: [00:47:07] I’ll answer your question, but first I’ll say I literally walked across the street from Twitter to Uber when I made that transition back in the day. And the two company cultures could just not have been more different. Uber was highly entrepreneurial, even at scale, very ambitious and committed to having different product lines, which is what I think is really help the company to kind of ride out this really volatile period of the pandemic. If it’s not rides, it’s eats. If it’s not eats, it’s freight, right? It’s a multiproduct company. And that gives you a lot of resilience when you have these kind of recessionary or just unpredictable macroeconomic moments. So I’m rooting for Uber. I’m rooting for Uber to continue to grow and become profitable. But, you know, the things that I go back to and you realize actually when you’re an investor, just how hard it is to kind of find these things in one company and how special it is, is one consumer products that are truly magical. It is that moment of magic. When you use it, you see how your life could be different and chat. JPT Like we just all had that moment with it, whether it’s that or something else. But like we felt that moment of magic, it’s something different. You can see how it changes your life. You could see how you could use this every single day or week. You’re like, Wow, I didn’t even know this could exist or that I wanted it. And that’s a very high bar. But you do see consumer products that are innovating in that way, and that’s really, really exciting for an investor. The other thing that I look for, and that obviously was a big part of making Uber successful as a marketplace and as a global platform is network effect. So within Uber, we had compounding both local and kind of national global cross product network effect. And when I look at marketplaces, I look for network effects. How does the utility of the marketplace or the product increase with both sides of the marketplace coming together? Is this viral like are people talking about it? Is it a verb? Is it something that you’re like at a dinner party like, oh, my God, you got to try this new app? Does it have that kind of word of mouth? And I think there’s always something with consumer companies that is about capturing the cultural zeitgeist or the moment when there is behavior change. And I think Uber was part of this moment when early days of the sharing economy or early days of mobile commerce, when we just started realizing that you could tap your phone and get anything, you could make transportation really personalized, inconvenient to you. And that was a really radical idea at the time. And so today there’s always the next marketplace. There’s a lot happening in B2B marketplaces, marketplaces for digital goods. Opensea is a great example of that. There will be more with Gen Z. We’re seeing a lot of innovation in consumer social. How do we communicate? How do we have fun with friends and you way? Can we get to really personalized content in search that is even beyond what we experience on tech talk today? And so there’s a lot of exciting stuff out there in consumer right now, but it does tend to boil down to is it viral, is it network effects driven, is it magical and does it have sort of broad applicability where you’re building like in a really massive category and transportation, by the way, trillion dollar plus category, it was easy to see how a company like Uber could reach massive scale and then be the platform for introducing a lot of other products to consumers. Something we we thought about it Uber and I think is still elusive for consumer in the US is this idea of a super app. There’s a lot of different companies ever tried to become that super app copy the WeChat model in the US. It hasn’t happened yet, but I think that there’s still an opportunity there. The question is, do you start with social, do you start with utilities, Uber as a utility, or do you start with fintech as kind of your wedge into that super app experience? But it feels like founders are trying to crack the code on that again [00:50:55][228.3]
Dan Nathan: [00:50:55] That’s one of the reasons why supposedly Elon’s very interested in Twitter is this X app and thinking about his interest in crypto and I think these are things that Jack dabbled into was also things that maybe the a16z crowd or kind of when they back clubhouse but it’s. Interesting to me how few consumer social apps have been able just to gain any traction. I have 17 and 19 year old daughters, and so I’ve seen almost everything that has made it onto their iPhones over the last ten years or so. It’s really ephemeral. Snapchat was six or seven years ago. So obviously Tik Tok and Tik Tok. I know this sounds idiotic. There’s a scenario where Tik Tok could be as ephemeral as the vine. It really is depending upon the time in which you got to define ephemeral right or transitory. That’s something that we do in financial markets punditry. We spent a year debating the length of time, the transitory, but there’s been really nothing that has bubbled up. My kids use BeReal. How the hell would you monetize BeReal. You know what I mean? Like, the list goes on and on. And the other thing I’ll just say is that the stuff that seems to catch fire and feel like magic when you’re in the pandemic and you’re stuck at home and you’re not working with your colleagues, and then all of a sudden you get an invite behind the velvet rope to this clubhouse thing, and all these fancy VCs or tech people are on it. And this really amazing conversation that just happened organically is happening. And then you look a few months later and it’s gone. The app’s gone. I mean, it’s just like no one’s on it. It’s not cool. Twitter had its moment. It was spaces and it’s gone. And I guess my point is, it’s like to make this stuff stick. [00:52:32][96.3]
Ann Bordetsky: [00:52:32] Yeah, consumers are fickle consumers are fickle. This is why consumer is so hard, I think, for investors and just hard for founders and builders in general. Consumer behavior is a notoriously hard to predict. Most of us can’t articulate what we want, an experience we haven’t seen yet. And even when you catch lightning in a bottle, so hard to hold on to it. It’s so hard to hold on to it because, you know, and clubhouse is a perfect example of that. Probably scale too fast. I loved it. In the early days, the level of intimacy in connection with an early clubhouse was like nothing I think most of us had experienced before to made sense in the moment, but it scaled too fast and it became too diluted, too noisy, and it sort of has struggled from there. I think unpacking Tick Tock is actually really interesting to understand where consumer expectations and behavior is going, because if you really think about it, Tik Tok is sort of rejecting everything that we know to be true about old social media. If you look at the data about why people use Tik Tok, why to spend hours a day on it cross sort of different age groups. One is Tik Tok is fun, it’s positive. You’re going to watch it for an hour. You’re going to feel great. It’s entertainment. It makes you feel good. Whereas being on Instagram, Twitter and Doomscrolling in general makes you feel terrible about life. So it’s like hitting that emotional button in us that craves positivity and fun and play and entertainment. And it’s deeply personalized, right? There’s no cold start problem in tick tock. You go in, you’re entertained from the very first moment you hit that screen. Whereas Twitter, like Twitter is work, man, you got to figure out who to follow, how to use the product. That’s too much work. It’s too big of a cognitive load. Most people will never get there, which is part of the reason the platform has stayed subscale. So I think within tick off, we have an indication of sort of what I think will shape consumer social going forward. It will be very personalized content. AI makes that easier. TikTok is already heavily in knows who you are. It can serve up addictive short form content that is deeply personalized to you. It is also a creative canvas like people want to have fun. Just like Snapchat was fine in the early days with the rainbow vomit filters and air lenses. What is the next generation of that look like with generative media? Because now we can do new stuff we weren’t able to do before. And so personalization, creative self-expression, we haven’t seen it yet, but there will be a company that emerges. Maybe it’s not be real, maybe it’s something else that kind of creates a creative communication canvas for for the next generation. And I’m definitely excited to see it. So if someone’s building it, come talk to me. [00:55:13][161.1]
Dan Nathan: [00:55:13] You should call in anyway and picture your consumer marketplace or social idea. But one of the things that’s interesting to me is that calls for TikTok being banned here in the U.S. for a whole host of reasons. All of our social platforms are not allowed behind China’s firewall there. And you’re seeing a bunch of red states ban, tick top apps on employees phones, fine state issued, whatever. But I guess if it were to be banned and you know, our country is obviously in a bit of a tit for tat with China on a whole host of economic issues, you could really see this as low hanging fruit. And again, the Chinese may not care because they have cracked down on their own digital companies and in a very harsh way over the last year and a half. But I suspect in the seat that you set up as you mentor and advise, entrepreneurs were coming up with crazy ideas and you’re trying to do what you can to help them achieve these goals. Tik Tok. Being banned here in the U.S. would be a boon for, I think, social innovation because so much of what. We’ve learned and then maybe the appetite for that from our consumers. So maybe there’s something in 2023 along the geopolitical lines that could be really interesting for U.S. social innovation. What do you think of that? [00:56:24][70.7]
Ann Bordetsky: [00:56:24] It’s possible. I have mixed feelings about TikTok going away because, yes, would leave a lot of space for new consumer social apps to come forward, probably. But there’s a lot of companies who are getting a ton of value marketing their products on TikTok. It’s a great distribution channel. It’s a great channel for a lot of consumer companies and consumer brands for growth and user acquisition. So if you take TikTok away, I think a lot of companies would take issue with that. It’s not all good, but the things that I see sort of coming up and where founders are really thinking creatively right now and building new products is one kind of personalized, highly curated, short form news alternatives, sort of piggybacking on TikTok, but focusing on like how will you consume information and media and using AI to kind of curate and summarize that information in new ways. And that’s just really easy to scroll and consume. There’s another company that is doing an amazing job of building a private community, a private Reddit community for college campuses, very much like the Facebook early days, really thinking about peer moderation, authenticity, positivity as kind of bedrocks of this community, social experience. And so there’s a ton of innovation happening. But at the end of the day, like if you’re a consumer app, you have to figure out how to get to a Zynga moment that puts you on the map with a lot of consumers and then build kind of a user behavior that really is sticky over time because what you’re really buying for is like not the TechCrunch media article, but a permanent place in people’s lives in their attention span, on their home screen. How do you embed yourself within people’s lives in a way that is truly meaningful to them and maybe a little bit addictive, but also meaningful? And I think Gen Z is very ready for new companies to come forward and really speak to how they see themselves and how they want to communicate and the ways that they want to build connections digitally first, of course, but in a way that’s positive and authentic and expressive. And I don’t think they can run away fast enough from Facebook and Instagram and everything that I essentially kind of have come to know and have been using for the last decade. [00:58:36][131.7]
Dan Nathan: [00:58:37] What comes next will be pretty interesting. Again, I’m not rolling. You know, Elon Musk in his goal to turn this product upside down, the idea about like a super app, a WeChat here in the States, it seems like something that we probably would be closer to rejecting than just embracing. When you think about this, for companies that have over trillion dollar market caps that are ruling our lives, if you will. And so I wonder if we get to a point where, you know, we start to see really some strategic M&A look at like snap sitting out there all alone. It’s got like a 15,000,000,000 billion enterprise value. It seems like a cheap social asset relative to what Elon just paid for Twitter. And again, it’s probably one of those places. But the way you describe tick tock, you’re not doomscrolling snap. You use it for communication, you use it to kind of feel good and watch user created content. And maybe there’s some Boltons to a product like that that could make it stickier as you get older and might age out of something like that, I think there’s probably a period of some sort of strategic M&A that happens in early 2023 or starts that way. We’re already seeing private equity away from this leveraged buyout and Twitter look at some of these funds like Rick and I just talked about, Tomo Bravo, who are just looking at really unique valuation opportunities to take companies private. So I just think there’s a whole host of things that might happen and you might see some of these deals where private equity partners with another company to buy this other assets. So maybe that’s what we have to look forward to in the near term as these markets try to bottom out. Well, listen, Ann I really appreciate you joining me on. Okay, computer, I really hope you’ll come back. [01:00:14][97.9]
Ann Bordetsky: [01:00:16] I really hope you’re right about M&A. It would be great for our ecosystem. Yes, right. Hope you’re right. [01:00:20][4.0]
Dan Nathan: [01:00:20] The IPO market has been, you know, obviously pretty horrible for all of 2022. SPAC as a exit vehicle was something that did not make it into 2022. M&A has been out there sparingly. Right. But I think that probably a lot of those things come back in 2023, probably the back half of that. And then it’s going to be great times for VC. You guys can get back to sharpening your pencils and. [01:00:44][23.2]
Ann Bordetsky: [01:00:44] It’ll be a great time for companies not named Meta to be acquisitive when it comes to consumer. If you’re not doing better or Google, you can be very cunning and opportunistic in this time. [01:00:55][10.7]
Dan Nathan: [01:00:55] Man. Matter of fact, AI and thanks for joining us. I hope you come back really soon. Happy holidays and speak to you in 2023. [01:01:01][5.5]
Ann Bordetsky: [01:01:01] Thanks for having me, Dan. [01:01:02][0.9]
Dan Nathan: [01:01:06] Thanks again to our presenting sponsor Current and our supporters Masterworks and Taboola for bringing you this episode of okay Computer. If you like what you heard, make sure you hit, follow and leave us a review. It helps people find our show and we want to hear from you. Email us at contact at risk reversal.COM. Follow and connect with us on Twitter at OK Computer Pod. We’ll see you next time. [01:01:06][0.0]
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