David Senra: I wasn't expecting to start here. I want to talk about why you were consuming so much caffeine that you noticed that your heart was skipping a beat.

Marc Andreessen: So, I love caffeine. So for a very long time, I always said that the ultimate day, like, the perfect day was 12 hours of caffeine followed by four hours of alcohol. That's just like the ultimate. I did cut out, or at least for now, I've cut out the four hours of alcohol. But yeah, caffeine is just one of nature's most marvelous things. But yeah, it turns out you can't overdo it. And so, yeah, a while ago, I was drinking so much coffee at work that I was sitting in a meeting a couple years ago, and I started to feel just a little bit... Something felt off, and I just took my pulse, and I realized I was skipping about every tenth heartbeat. And so, I had like an existential crisis because I'm like, all right, heart, you know, do I need to call 911? It's just like, am I about to have a heart attack? Am I about to die? And so I go under the table, and I Google, and I'm like, "Is this a problem?" And Dr. Google said, "No, it's okay. It's fine. You just might want to cut back a little bit on the caffeine."

David Senra: You said something that I love, and I never hear other entrepreneurs talk about, but I think it's super important that you don't have any levels of introspection.

Marc Andreessen: Yes. Zero. As little as possible.

David Senra: Why?

Marc Andreessen: Move forward. Go. Yeah, I don't know. I've just found people who dwell in the past, get stuck in the past. It's a real problem, and it's a problem at work, and it's a problem at home.

David Senra: So, I've read obviously 400 and, I think, now 10 biographies of history's greatest entrepreneurs.

Marc Andreessen: Yeah.

David Senra: And that was one of the most surprising things, like what's the most surprising thing that you've learned from this? They're like, "Oh, they have little or zero introspection."

Marc Andreessen: Yeah.

David Senra: Sam Walton didn't wake up thinking about his internal self. He just woke up, he's like, "I like building Walmart. I'm going to keep building Walmart. I'm going to make more Walmarts," and just kept doing it over and over again.

Marc Andreessen: And you probably know, if you go back, before 100 years ago, it never would have occurred to anybody to be introspective. Like, the whole idea of, I mean, just all of the modern conceptions around introspection and therapy and all the things that kind of result from that are kind of manufactured in the 1910s, 1920s.

David Senra: Say more about that.

Marc Andreessen: Great men of history didn't sit around doing this stuff at any prior point, right? It's all a new construct. So, first Western civilization had to kind of invent the concept of the individual, right? Which was like a new concept several hundred years ago. And then, for a long time, it was all right, the individual runs, right? And does all these things, and builds things, and builds empires, and builds companies, and builds technology, and does all these things. And then, kind of this guilt-based whammy showed up from Europe, a lot of it from Vienna, in the 1910s, 1920s, Freud and all that entire movement. And kind of turned all that inward and basically said, "Okay, now we need to basically second-guess the individual. We need to criticize the individual. The individual needs to self-criticize," right? The individual needs to feel guilt, needs to look backwards, and needs to dwell on the past. It never resonated with me.

David Senra: Do you find a lot of the greatest founders that you've spent time with, and backed, and partnered with or have low introspection?

Marc Andreessen: Yeah, generally. Although, in fairness, the introspection is probably linked to the personality trait of neuroticism, right? So, a lot of the best founders are, I think, at 0% neuroticism. They just don't get emotionally fazed by things that happen, which is a superpower when you're an entrepreneur. But having said that, some of the great entrepreneurs are, in fact, very neurotic. That's also the case. Maybe it's nice to have to be low neuroticism, but not necessary.  And so, there are some that kind of get wrapped around the axle, on kind of personal issues. As you know, these days, sometimes that then, kind of turns into the use of psychedelics, different kinds, and hallucinogenic drugs. And that's like one very interesting kind of trajectory for the kind of the culture of the country, culture of the world, and we'll see where that goes.

David Senra: So we've recorded, I don't know, like a dozen of these so far, most of them with some of the greatest founders living for the show. I can't believe how many times on almost every episode psychedelics pops up.

Marc Andreessen: Yeah.

David Senra: And they're like, "You should try them." I'm like, "I'm not doing any drugs."

Marc Andreessen: Just want to be clear, I'm not. I never have. I'm never going to. You know, the problem is I already have tons of horror stories from people I know, or know of, that kind of came out the other side like... Well, actually, my deepest conversation on this was actually with Huberman. And I was describing this phenomenon where we see in Silicon Valley where these guys get under pressure, and they kind of feel anxious or whatever, and somebody tells them about psychedelics, and they try it. And they kind of come out the other end as a changed person, and they kind of come out much more at peace, but then they also tend to quit their companies. And they move to Indonesia and become a surf instructor. There's just peace out, right? They're just done. There's been a whole bunch of examples of this, and I was complaining to Huberman about this. And in true Huberman kind of wise Yoda style, he's like, "Well, how do you know they're not happier?" Right?

David Senra: Yeah.

Marc Andreessen: Maybe that was the positive outcome. Maybe the thing that was driving them to be a great entrepreneur was a fundamental level of insecurity, right, and kind of this unsatisfied, kind of neurotic impulse. And now they're just satisfied. Now they're just, whatever the serotonin levels or whatever have been recalibrated, that they're just kind of satisfied sitting on the beach and being a surf instructor. Maybe they're better off. And I'm like, "Yeah, but their company is failing." And so anyway, yeah. There's a possibility that there's a better version of you or me on the other side of Ayahuasca, but I'm not willing to find out.

David Senra: I'm not either. Daniel Ek has the greatest way to put this. He thinks the best entrepreneurs are not optimizing for happiness; they're optimizing for impact.

Marc Andreessen: I think that's true. I think that's true. I think it's certainly true for Daniel, yeah, who's kind of a great case study of that. Having said that, I always kind of wonder is that, well, intrinsic versus extrinsic motivations. Impact strikes me a little bit as an extrinsic motivation. It's like, yeah, impact, money, fame, you know... And by the way, I think extrinsic motivations are fantastic, and I think they can be very motivating. The people who kind of get the great rewards for building great things deserve them. But at least what I've found is it's the intrinsic motivations that actually get people up in the morning. And that's where you're dangerously close to straying into introspection, but it's like, what is the thing that causes somebody who's now extremely materially wealthy, extremely successful, to get up in the morning and continue to kind of punch away at the world? I think those tend to be interior.

David Senra: What's that for you?

Marc Andreessen: Oh, I mean, that would require introspection. I'll let other people speculate.

David Senra: No, you have to have...

Marc Andreessen: It's a lot more fun to speculate about other people's introspect...

David Senra: But I am curious about you, because you have a series of quotes that I absolutely love. I save on my phone. I reread from time to time. One of them, and I'll butcher it, but it's just like, the world is way more malleable than you think.

Marc Andreessen: Mm-hmm.

David Senra: And if you just pursue something with a lot of maximum effort, drive, and energy, the world will recalibrate around you easier than you think.

Marc Andreessen: Yeah.

David Senra: And I actually re-read that this morning before I came over here, and I was like, what is that for Mark? Today, what are you waking up trying to change in the world?

Marc Andreessen: Yeah, there's a lot that we're actually trying to do. I'm suspicious that that's my actual underlying motivation. Yeah.

David Senra: Why?

Marc Andreessen: Just because, I don't think an external impact is enough to keep people going, or at least I've seen way too many people who had a high level of external impact, and then at some point, they just stop.

David Senra: Okay.

Marc Andreessen: Well, here's the problem with external impact. It's like, okay, it's four in the morning, you're staring at the ceiling, is that enough? Right. External impact is stuff that's happening to other people, right? But all right, what is it about you?

David Senra: Yeah.

Marc Andreessen: The story I like to tell myself is that I'm competing with myself, right? The story I like to tell myself is I'm getting up in the morning because I'm trying to become a better version of myself. I'm trying to become smarter and better informed, and reach better conclusions, and be better at what I do, and continue to expand my skills. But again, to actually analyze that properly would require a level of therapy that I'm not willing to engage in. So anyway, so yes, the much more comfortable conversation is "What are you trying to do in the world," which I would love to talk about.

David Senra: I have almost no introspection either, so I understand that.

Marc Andreessen: Right. Yeah.

David Senra: All right, so tell me what you're trying to do in the world then.

Marc Andreessen: Yeah, I mean, look, we have had this... It's actually fairly amazing that it's become a controversial kind of thing, but we just have this like fundamental view that technology is, on balance, an enormously powerful force in the world, and basically that the big problem with the world is that there's not enough technology, there's not enough information, there's not enough intelligence. And we have this opportunity, we have these special sets of technologies that let us fundamentally improve things. And then there's this very special kind of personality type of the entrepreneur, who's able to build the product, and then able to build the company, and build a phenomenon, and really make an impact on things. And when I look at the world, I'm just like, okay, this is just like... The world we live in is just a very primitive and crude place as compared to what it should be, and what it could be. And so the whole thing that we've been trying to do for 17 years at our firm is build kind of the ideal partner to the founders that are trying to do that, based on our own experiences of having been founders that we're trying to do that. Overall, the world, especially the Western world, is just stagnant. The overall kind of theme of things is just everything is stagnant, and we could talk a lot about that.

David Senra: Mm-hmm.

Marc Andreessen: But every once in a while, you have somebody who comes along, and it's just like, all right, no, I actually have an idea of how to make things fundamentally better, and I have a way to build a business around that, and build a company, build an empire around that. And those people, include ourselves in this, but those of us that are trying to do that, we're like a rough movement basically against stagnation. But without us, there's nothing but stagnation.

David Senra: Mm-hmm.

Marc Andreessen: But it's actually really funny. There's always this kind of criticism that you get from, whatever kind of, as I say, the corporate press or a kind of outside critics, which is like, "Oh, you VCs are funding the wrong things," or, "You entrepreneurs are building the wrong things." It's like, well, nobody licensed us to do any of this. We didn't apply for a permit, right? Get judged by somebody ahead of time and told, "Yes, you get to do this, you don't get to do this." Many people could be trying to do this. Anybody can do this. Anybody can start, build a product, start a company, start, even try to be a VC. These are all completely open fields. And it's just shocking to me how few people actually give it a shot. And the fate of the world over the next 1500 years is riding on the people who actually want to give it a shot.

David Senra: I want to tell you about the presenting sponsor of this podcast, Ramp. I have been reading a lot about SpaceX lately. SpaceX is one of the most valuable private businesses in the world, and one of the main themes in the history of SpaceX is constantly attacking and questioning your cost. Ramp helps many of the most innovative businesses in the world do exactly that. The median company running on Ramp cuts their expenses by 5%. And one thing SpaceX has demonstrated is that a religious dedication to controlling costs can help actually increase revenue, because you can pursue opportunities you couldn't otherwise. And we see that in the Ramp data too. The median company running on Ramp also grows their revenue by 16%. So, when you're running your business on Ramp and your competitors are not, you have a massive competitive advantage that compounds over time. Ramp is the only platform designed to make your finance team faster and happier. Many of the top founders and CEOs I know run their business on Ramp. I run my business on Ramp, and you should too. Go to ramp.com to learn how they can help your business save time, save money, and grow revenue. That is ramp.com. So, when you started the firm 17 years ago, was your thesis exactly the same as it is today?

Marc Andreessen: I'd say the core thesis is the same. The specifics have varied; they have changed enormously. We can talk about both parts of that. But yeah, no, the core thesis was kind of the startup, the entrepreneur, the founder is going to be the core engine of progress in the world, and I think that's more true than ever. In fact, when we started, it was still controversial, the idea that a founder would run their own company.

David Senra: Yeah. Even in 2008, 2009?

Marc Andreessen: Yeah. Yeah. Well, it was still very controversial, and in fact, there were high-profile companies at the time that were getting heavily criticized for basically having these little kids running these companies.

David Senra: Okay, so you have this encyclopedic knowledge of the history of Silicon Valley in your head. I probably read, I don't know, 30 to 40 books on it, so at some level, but not that you do. I remember reading a book on Nolan Bushnell, founder of Atari, who was 27 at the time, and it was excessively rare. It talks about that. In his story, it's just excessively rare for him not to be replaced once Atari started growing with an older CEO.

Marc Andreessen: Yeah.

David Senra: Were there other examples before him?

Marc Andreessen: Well, so Christopher Columbus. Alexander the Great.

David Senra: Yeah.

Marc Andreessen: Right? So, throughout history, most of the... Thomas Jefferson. Throughout history, most of the great things that have been built have been built by this kind of super-charismatic founder type, you know, will to power founder type, who, basically, built and run something to...

David Senra: Yeah. Okay, hold on.

Marc Andreessen: Henry Ford.

David Senra: Hold on. I love that you went here because you don't remember this, but we had dinner in Miami with Jared Kushner, a year ago or something, and me and you would wrestle because I was so excited to talk to you, and I was trying to get out of you like... Because I think about how history's greatest entrepreneurs all day.

Marc Andreessen: Yeah. Mm.

David Senra: This is what I do seven days a week. Who are these entrepreneurs from history that you like? You just started naming country founders.

Marc Andreessen: Yes, true. Exactly. There's this recency bias, right? Which is like the world that we live in today is the normal state of the world. And everything that happened in the past is weird and different, and those people were dumber than we are, and all screwed up. And it's like, well, maybe.

David Senra: Mm-hmm.

Marc Andreessen: Or, maybe the world worked a certain way for thousands of years, and we're in the weird time. Maybe we're in a time that's just really unusual from a historical standpoint. And I think this is one of those dimensions in which that's true. It never would have occurred to anybody a 100, 200, 300 years ago that if somebody was going to start something, that they were going to be the person who ran it, like obviously. It was just obviously the case. The book that I always recommend on this topic is called "The Machiavellians," which is this sort of a famous book from the 1940s, by this guy James Burnham, who's one of the great geniuses of the 20th century. The way he describes it, basically, is he said, look, there have been two fundamental modes of business organization over the course of, basically, the history of capitalism. There's what he calls bourgeois capitalism, which, basically, is like the founder runs the company, name on the door. And the classic archetype for bourgeois capitalism was Henry Ford, in the 1920s, and today it's Elon Musk, right? It's just like, that's you. And by the way, in the old days, it was Ford Motor Company, you know, it's not Musk Motor Company.

David Senra: Yeah.

Marc Andreessen: But everybody knows Tesla and SpaceX, you know, these are Elon. And again, that maps to this historical thing, which is that's also how countries ran, and that's also how cities ran, and all these things. Religions, by the way. Basically, everything, founders led the way. That's the historical norm. And then what he basically says in this book is he goes through and he says that there's this new model that basically is an artifact, again, it's an artifact of kind of this weird period of time between the 1880s and 1920s, where kind of the modern world, as we know it today, kind of formed. And he said there's sort of a new philosophy of sort of leadership and management, which is called managerialism, sort of the rise of the concept of a manager. And specifically a manager as contrasted to a leader. And so, therefore, the manager, therefore, the idea of a management school.

David Senra: Right.

Marc Andreessen: Therefore Harvard and Stanford Business Schools, right? Therefore, the idea of the manager who replaces the founder running a company. Therefore, the idea of management as a skill set that can be used to run many different kinds of businesses. In the '70s, this then turned into the conglomerate, which was the idea that it doesn't matter what the company does; if you have a good manager, the company should do 30 different things. And so managerialism is this idea that you have this kind of interchangeable management skill, and that that can basically run anything. And actually what Burnham says is he says, "Look, people are going to try to draw a value judgment on this, and they're going to try to say this is better or worse than the old name on the door model." But he said, "The reality of the modern world is everything is big."

David Senra: Mm-hmm.

Marc Andreessen: For the electrical power grid to get big, or the road network to get big, or the car industry to get big, large-scale systems need to be run by people who are trained in how to run large-scale systems. And so he said, "You may or may not..." And the same thing with countries. Large-scale countries are going to need to be run by people who are good at running large-scale things, right? And the founding personality type is not the manager personality type. Those are different. And so there's going to be a handoff when things get big and complicated. And so that's the model that Nolan Bushnell talks about, and that's the model that dominated Silicon Valley for 50 years. The problem with his argument is that assumes the managers are going to do a good job.

David Senra: Mm-hmm.

Marc Andreessen: Right? And I think if there's one dominant theme that we're seeing in the last 30 years, in the West for sure, is that managers, generally, writ large are not doing a great job. Or another way to put it is the managers maybe are good at managing something that's going to be status quo for a long time.

David Senra: Mm.

Marc Andreessen: If it doesn't change, maybe they can run the banks for a long time, or they can run the power company for a long time, or the car company, and as long as the car is the car is the car, or soup is soup is soup, it kind of doesn't matter. But the minute things change, the manager personality type, because it's not the founder personality type, it doesn't know how to deal with change. Not everything is changing. A lot of things aren't changing, but for the things that are changing, they're changing like really, really quickly. I mean, SpaceX is like the classic example of this. Imagine being a professionally trained manager, trained at a top management school, working for a rocket launch company, competing with SpaceX. And the assumption of the entire rocket industry for the last 100 years has been the rockets are used once, and then that's it. And the economics of launch are dominated by having to build a new rocket every time. And then, this crazy guy in California comes up with this thing where the rockets land on their butt. And you can't replicate it. Okay, your management skills... Like, what good are your management skills at that point? And I think there's like a whole bunch of interesting areas of human activity where that shift is happening. And so, I think this is where Burnham's thesis collapses, where it's just like, okay, the managers actually can't do it. Yep. Yes, there's a need to run things at scale, but no, the managers actually can't do it because they can't adapt.

David Senra: And the founder can just learn how to run things to scale.

Marc Andreessen: Well, that's the theory, and that's a big part of our theories, yeah, the founders can actually learn how to do this. And look, this is still a controversial topic. This still comes up because...

David Senra: Is it controversial?

Marc Andreessen: Well, it is because founders aren't necessarily... Especially, founders on day one are not good at doing this. Okay, so in tech, we should talk about tech specifically, in tech, the founder tends to have been in a lab, literally or metaphorically, for 20 years before they start their company. They've been probably working by themselves with a small team. They've been building technology. They haven't been running things. They haven't been managing large organizations. They haven't been running public companies. And so, there is a missing skill set, right? And on day one, they don't know how to do that. And so, they do need to be willing to learn how to do that. And then, by the way, they do need to be capable of doing that because some of them can and some of them can't. So this, maybe, is like the core thesis behind our firm, which is, you're much more likely to build something important in the 21st century if you start with the founder and train them on management, than you are to start with the manager and try to train them on being a founder, on creating new things. And I think that this trend is intensifying. Because what's happening is all the old edifices, all the old incumbent institutions of the last 100 years that are run by managers, they're all in some state of fundamental collapse. They're all collapsing in trust and credibility because they can't adapt. And so, this issue is becoming more and more acute, which is the system that we thought was necessary and sufficient, actually, just does not work. And if anything good is going to happen, it's going to have to be somebody, it's going to have to be a Henry Ford, Elon Musk type who actually does it.

David Senra: You think it's in a vast minority of people agree with you?

Marc Andreessen: Look, it's becoming more common. I mean, when you get an Elon Musk and a Steve Jobs, when you get these kind of archetypal examples of it, it's a lot easier to sell it. Mark Zuckerberg, we were talking about earlier, he's now a great case study of this, right? When Mark started Facebook, he had never had a job before.

David Senra: Yeah.

Marc Andreessen: Okay. Not only had he not managed people, he had not worked for anybody, right? And so he started with zero, and his learning curve, which, by the way, happened fully in the public eye, right? His learning curve was vertical. And by the way, it's still vertical. He spends an enormous amount of time learning how to become better at running these things at a large scale. He's still the founder, and he's still the innovator, and he's still like a fountain of ideas on what to do. So, he's like the classic example of the double threat. And then what happens is other founders look at that and they're like, "Oh, I could do that." Right?

David Senra: Which is exactly what Steve Jobs said when he saw Nolan Bushnell.

Marc Andreessen: Exactly.

David Senra: "I can run my company."

Marc Andreessen: "I can do that." Yeah, exactly.

David Senra: Yeah.

Marc Andreessen: And by the way, it's amazing how fast this stuff shifted, because Steve famously had this short period of time where he worked for Hewlett-Packard, and I think, I don't know if it's true. The legend is that Jobs pitched his manager at Hewlett-Packard...

David Senra: No, Wozniak pitched him.

Marc Andreessen: Was it Wozniak? Okay. All right. Okay, okay. Wozniak pitched.

David Senra: Yeah, Wozniak. Yeah.

Marc Andreessen: There was some other story where Jobs went into a meeting with some manager trying to pitch the thing, and the line from the manager was, "Absolutely not. This is the dumbest idea I've ever heard. Get your feet off my desk and get out of here." Right? You can just imagine Steve with his...

David Senra: And they had to be bare feet at that time.

Marc Andreessen: Oh, prob...

David Senra: My favorite Apple lore is that the first sale in Apple's history was made barefoot. When he walked into the Byte Shop, he was barefoot.

Marc Andreessen: What's amazing about that is, yeah, so Wozniak for sure worked for Hewlett-Packard. Everything I'm describing was Hewlett-Packard in the 1950s, 1960s, and 1940s. That was also Dave Packard and Bill Hewlett, were that founder-type.

David Senra: Yeah.

Marc Andreessen: And Dave Packard and Bill Hewlett ran their company, between the two of them, for 50 years.

David Senra: Do you think that's the most...

Marc Andreessen: And, by the way, Silicon Valley was built, in large part, on HP. HP was the original Silicon Valley company.

David Senra: Okay, that's the next question.

Marc Andreessen: And it was run by its founders for 50 years, and yet, people concluded the founders shouldn't run the companies, right? And so, it's one of those things where it's like it's kind of so obvious, it was staring everybody in the face, and so people had to construct kind of, basically, these elaborate kind of lattices of theories to basically get around the fundamental fact that you need somebody who knows what to do, actually running the thing.

David Senra: Do you think HP might have been the most influential company in Silicon Valley history?

Marc Andreessen: It was, for sure, the most influential company from 1940 to 1980, and then probably after that, Intel.

David Senra: Well, go to the founders of Intel and you read biographies of them and they talk about modeling off of HP.

Marc Andreessen: Yeah. Yeah, that's right. That's right. Yeah, that's right.

David Senra: And then how many founders modeled off of Bob Noyce and Intel after the fact, including Steve Jobs, who would go to Bob Noyce's house for dinner.

Marc Andreessen: Yeah, yeah. Yeah. That's right. By the way, that's another great example because Bob Noyce, at least, you know... If you look at photos of Bob Noyce, you're like, "Wow, this guy's like a pillar of society." He's very, very well-dressed, and he's kind of very adult, and he's famously the leader of the Traitorous Eight.

David Senra: Yeah.

Marc Andreessen: You know, they're the group that left Shockley to start Fairchild, and then left Fairchild to start Intel.

David Senra: And then left Fairchild to start Intel. Yeah, exactly.

Marc Andreessen: And so Bob Noyce was 100% the Steve Jobs of his time, just in the short-sleeve white dress shirt and the skinny black tie.

David Senra: Yep. Yeah.

Marc Andreessen: Again, it's like the exact same thing. And so, I unfortunately never met Bob Noyce, but I could easily imagine Bob Noyce and Steve Jobs sitting down and being able to talk for three hours, and completely understanding each other despite the fact that the look and feel is completely unlike.

David Senra: He was almost like a disciplinarian to Steve because Steve was wild and reckless. I was also wild and reckless. You need to mature. And I think Bob's wife, maybe, went to work at Apple early on, too. He talked about this in his biography. There's a few great biographies of Bob Noyce, but he said that the reason he spent so much time after he was really successful spending time with young entrepreneurs, he said it was restocking the stream in which he fished from.

Marc Andreessen: Amazing.

David Senra: He thought it was really important, and he's like, "I learned from all the guys before me. I need to take that knowledge I've built up over multiple decades and push it down the generation." I want to go back to starting the firm, though. This is interesting. What was occurring in your life, either at that time or before that, that you had this observation that this had to be done?

Marc Andreessen: We've got all these elaborate theories. The practical reality of it was, my partner Ben and I had become very active angel investors. And I'd been an angel investor since the mid '90s, but then Ben and I started doing it kind of as a real thing, putting significant time into it, probably starting in 2003. Well, I did it kind of throughout the early 2000s, but 2003, 2004. It's hard to remember now, but if you go back to 2003, 2004, there weren't thousands of angel investors. There were like eight. It was like Ron Conway and a handful of people. And then Ben and I were running around doing it. And this was very significant in the evolution of the venture capital industry, because this was the point at which the traditional VCs got disintermediated by angels and seed investors, who kind of inserted in before the VCs arrived, which was this fundamental change that changed the whole industry. But we were part of that. But as a consequence, we were investing in all these new companies, basically, at the point of formation. We were basically playing amateur early-stage VC. And we were always like, "We're not going on the board. You're going to raise money from a real venture firm later. They're going to go on your board and whatever and work with you." And what we just found, over and over and over and over again, was we ended up getting pulled into these companies, either because there were issues that, just like the other people, that they were working with, or they either hadn't raised venture yet, or the VCs that they'd raised from couldn't help them with. And so we just got pulled in, and the reason was we had been running companies at that point for 20 years. We at least had some idea of what we were doing. And then the other was we kept getting brought in to do conflict resolution between the founders and the VCs, right?

David Senra: Yeah.

Marc Andreessen: Especially because, again, much more common at that time, especially if the VC's fundamental point of view is the founder's not going to run the company, and we need to replace you with a professional manager as fast as possible. The founders are not necessarily going to like that, and they might resist that, and by the way, even if they're on board with that idea, they might not like the person who the VC wants to bring in. And so, we kept ending up in these kinds of, basically, as arbitrators in this sort of... And in theory, we were kind of trusted intermediaries because we knew the founders, we knew the VCs, and we could kind of help bridge between that. But literally, what happened was after a while, we were spending like eight hours a day just doing this. And we're like, "All right." And, it's like weird. It's like you're writing 100,000 dollar check, and you're spending all this time doing it, and then to basically arbitrate it with somebody who wrote a 10 million dollar check. And it's just like, all right, we should probably just write the 10 million dollar check. So, I always think like the founders, always one of my theories of the great founders is, they tend to be able to operate at kind of a strategic, conceptual level and then the practical level at the same time. And so, we had a whole theory I could take you through for the evolution of the venture business.

David Senra: Please do.

Marc Andreessen: Yeah. But underneath that was just this actual, the lived experience of what was actually happening on the ground. The big theory of the firm that we had at that time was linked to this idea of founders running the show, but it was also a structural observation of what was happening in the venture industry, which was... Basically, what we did was we sort of, in line with your philosophy, we went back and we studied a lot of other businesses that have similarities to the venture business. And so, we studied private equity, hedge funds, investment banks, law firms, management consulting firms, ad agencies, accounting firms. You know, basically anything where the product is fundamentally a relationship, a knowledge work, kind of relationship as compared to something that gets manufactured. And what we observed is, basically, an example, Hollywood talent agencies actually is the one we've probably talked publicly about the most, and so that was a great case study.

David Senra: Ovitz.

Marc Andreessen: Oh, the Ovitz story.

David Senra: He was in this studio a few months ago. Yeah.

Marc Andreessen: Fantastic. And by the way, we make a point of crediting, he gave us a lot of this theory, so a lot of this comes from him. But, well, actually I'll tell it through his experience. So when he started his agency, was it 80-whatever? No, 75? 75.

David Senra: In the 70s, I think, yeah.

Marc Andreessen: In the 70s, like in the mid-70s. It was actually very similar. Structurally, it was very similar to when we started, A16Z in 2009, which was the configuration of the industry at that point was basically a bunch of essentially service firms, a bunch of talent agencies, none of which were at very high scale. And then each of them was, basically, a tribe of basically solo operators and kind of lone wolves. So the concept in Hollywood was you had an agent, and that was your guy. And that agent knew whoever that agent knew, and had whatever relationships that agent had. But the other agents at your agency were not available to you, and there was no collective benefit to the fact that you were at an agency that had not just your guy, but like a hundred other guys. There was no collective payoff to that. They ran that in that way for a very specific reason, which was this kind of this, "Eat what you kill" professional services mentality, where everybody should have to go build their own book of business. But you end up just dealing with a guy as opposed to a firm. Like, there's no firm, there's no collective thing. And that was basically the condition of venture capital in 2009, which is you have been... At this point, we knew all the VCs really well, and we had raised venture, and we had worked with all these other companies that had raised venture. And basically, all of the sort of legacy venture firms at that point, they were all like that. They were all just like tribes of lone wolves. And then, the thing that we knew that was not publicly known was, generally speaking, inside the firms, they didn't even like each other.

David Senra: Oh, I hear stories like this all time.

Marc Andreessen: Right. And so it's like, whatever, there's Joe and Mary, who are partners at a venture firm, and you're working with Joe, and Mary has a key connection that you need access to. And so, you ask Joe, "Can Mary introduce me to so and so?" And what you don't know is they're having like a brutal fight, where they're trying to destroy each other because they're fundamentally economics. They're going for a greater slice of the profit pool. And so they're really going at it. And so, we saw example after example of a venture firm that was, basically, either two things, actually. One is either melting down due to just internal strife and conflict. Or by the way, the other was generational succession, right? The other issue is a lot of the dominant venture firms in 2009 had been around for 30 or 40 years, and they were now on their third generation of partners going to their fourth generation of partners. And again, it's the same thing. They had been founded by Dynamos, and then, the later generation people were not like that. So, we basically said, "Oh, this is where the obvious thing comes in," is we said, "Look, that's not going to last." And so our theory of it was what we call death of the middle, or we sometimes... The negative way to frame it is death of the middle. The positive way is the barbell, which is what's happened in all these other industries, which is basically the industry gets stretched apart like taffy. And what you get is you get this barbell thing, and on one side of the barbell, you get early-stage angel seed investors who are really like first money in, staying very light on their feet, writing a relatively small check, but being involved in companies extremely early on, taking a lot of risk. And then on the other side, you get basically scaled platforms, right? So, you get large-scale enterprises that have a lot of throw weight, a lot of access, very big networks, and then access to a lot of money. The other comparison we always make is to retail shopping, right? Which is, there used to be department stores like Sears and J.C. Penney, which basically, where the brand promise was a pretty good selection of products at pretty good prices, right? And now, those are dead. And what you have instead are boutiques like the Gucci store or the Apple store, and then you've got this super scale e-commerce companies like Walmart and Amazon. If we were to the point where it's just like, there's no reason to ever go to a department store because it's got less selection than Walmart and Amazon, but it doesn't have the quality tier and the special experience of a Gucci or Apple store.

David Senra: But you had that thought in mind when you started A16Z?

Marc Andreessen: Yeah. Yeah, 100%. Yeah. Exactly. Yeah.

David Senra: Wow, okay.

Marc Andreessen: It was a conceptual leap for venture capital at the time, but the exact same thing had happened to private equity. The exact same thing had happened in hedge funds. The exact same thing had happened in investment...

David Senra: And you knew that by what? Just reading about it?

Marc Andreessen: Reading. So, the investment banks are the classic example. So, if you read about the sort of the original investment banks in the US, between 1880 and 1920, they were all like boutique venture capital firms in the 1970s, 1980s, in the US. It was like 20 guys.

David Senra: These are more like merchant bankers.

Marc Andreessen: Yeah. Well, and so, the classic stories which I love so much, so JP Morgan's one of my kind of favorite historical figures. And JP Morgan was an example that. The JP Morgan investment bank was basically very important, but it was like this tiny little operation. It was fit in a single office. I don't know, probably 20 principals and some office staff or something. It was not large. And actually, the hidden secret to JP Morgan was he was the son. The father was Junius Morgan.

David Senra: Okay. I literally, when you were talking, I was like, wait, I was shocked that you would say pick him because I actually found his father more formidable individual than him.

Marc Andreessen: Yeah, he was. So he was, which is almost always the case with any famous public figure, is the father is almost always a more interesting story, which a lot of examples of that. But however, yeah, so Junius Morgan and then, and then J.P. Morgan has filled a specific economic role that's gotten lost in history, which is basically Junius Morgan. The Junius Morgan Bank was in London. The J.P. Morgan Bank was in New York. And what the Morgan family was doing was they were funneling money from the old slow-growth economy of Europe into the new high-growth economy of the US.

David Senra: Yes.

Marc Andreessen: But again, it was exactly your point, like it was this little boutique family operation. The other great thing about that era of history is they were all bifurcated by religion.

David Senra: Yeah.

Marc Andreessen: So, they were the Protestant investment banks, and there were the Jewish investment banks.

David Senra: Yeah.

Marc Andreessen: And they did not mix.

David Senra: And no, not at all.

Marc Andreessen: Completely different worlds. And as a consequence, the Protestant banks like J.P. Morgan were able to fund the railroads, which were considered the real businesses at the time.

David Senra: Yeah.

Marc Andreessen: But then, all the disreputable stuff like movie companies and department stores, those are all the Jewish investment banks. By the way, almost entirely Jewish founders with like... And then, J.P. Morgan is the big survivor of that today in the form of J.P. Morgan Chase. And then, on the Jewish side, it's Goldman Sachs is the great survivor. But again, if you go back, there were...

David Senra: You consider that the barbell in investment banking. You have the J.P. Morgan, kind of like family partnership, and then you have the complete scale of like Goldman Sachs.

Marc Andreessen: And so what happened was both J.P. Morgan and Goldman Sachs started out a hundred years ago, they were actually in the middle. They were kind of, again, this sort of, they were boutiques, but they were of their time. Today, you'd call them mid-market, who's sometimes called bulge bracket kind of thing, as opposed to just like a solo operator or something. Actually, the way JFK's father got started was he literally hung out a shingle in the 1920s, which is Joseph P. Kennedy, banker.

David Senra: Yeah.

Marc Andreessen: Private banker, and he just did deals, and he was an angel investor at the time. And then you had the big commercial banks, but the big commercial banks had no interest in issuing loans to these speculative, crazy entrepreneurs. And so in that time, J.P. Morgan, and Goldman Sachs, and Kuhn, Loeb, and Drexel, and all these other kind of mid-market banks, Morgan Stanley, the banks that became Morgan Stanley were kind of these mid things. Now, what's happened sitting here a hundred years later, those are now the scaled players. The ones who didn't scale are kind of long forgotten. Having said that, there's one firm that survives in the old model, and that's Allen & Company. And there are other boutique investment banks today, but Allen & Company was founded in the 1920s, and is uniquely the one that survived in the original model of boutique and deliberately being a boutique investment bank, and it stayed that way for a hundred years. And so one way to think about it is that today that's the barbell in banking, which is Allen & Company on the one side and then J.P. Morgan and Goldman Sachs on the other side.

David Senra: I found one of my all-time favorite quotes when I was reading the book "Zero to One." The quote says, "The single most powerful pattern I have noticed is that successful people find value in unexpected places, and they do this by thinking about business from first principles instead of formulas." That is exactly what AppLovin has done with their new advertising platform, Axon. Axon is the most powerful advertising platform in a generation. Axon allows you to capture undivided attention. Axon ads are full-screen videos that are watched for an average of 35 seconds, retention that blows other ad platforms out of the water. And you can launch in minutes. You set the goal, and Axon achieves it. No complex setup, no expertise needed. And Axon scales quickly. They can put your ads in front of over a billion potential customers. Other businesses have seen immediate results, scaled to hundreds of thousands of dollars of spend per day, and increased their revenue by millions. And most advertisers aren't even thinking about this channel yet. Less than one percent of advertisers have access to Axon, so you want to get started quickly. And you can do that by going to axon.ai. That is axon.ai. So are you reading about this while you're founding the firm?

Marc Andreessen: Yeah.

David Senra: Before you're founding the firm?

Marc Andreessen: Yeah. Well, Ben and I spent about a year and a half planning the firm, and part of it was he was in, we call industrial servitude. He was working for Hewlett-Packard after we sold our company to HP. So, he was running a big part of HP at the time. And so, we couldn't literally start a new full-time thing until he got free of that. So, we had a year and a half to kind of study and think and work.

David Senra: And because you had this, this period from 2003 or 2002, when you're doing angel investing a lot till you start your company six, seven years later.

Marc Andreessen: Yeah. Yeah.

David Senra: You're observing all of the weaknesses in the model, and that's where you have, "Hey, why don't we take the CAA?" I think Ovitz calls it like the phalanx, where it's like, if you have one agent at CAA, you have all of us.

Marc Andreessen: Yeah, right. That's right.

David Senra: And they would like roll deep. I think he says in his book, it was like, "Oh, my agent's coming to the premiere." No, it's like 20 agents are coming.

Marc Andreessen: Yeah.

David Senra: And I think they'd be dressed in the same kind of suit maker, and they were intentionally trying to intimidate their competition.

Marc Andreessen: Armani suits, Sulka Shirts was a shirt maker in Beverly Hills, and all sober colors, white shirts. And then, I think he had a bulk purchase deal, I think, with the local Jaguar dealer. And the legend, at least, has it that the license plates all said CAA one, CAA two, CAA three. And so, you'd go to a premiere, and there would be 20 Jags lined up. And then 20 guys in identical suits coming out. And yeah, this is exactly the thing. It's just like, now that's the Hollywood version. But, just imagine the psychological impact of that if you're just like an old school agent. I mean, this is sort of Michael is a very dear friend. He became very controversial over the years, and the reason he became so controversial, I think, is just because he smoked his competition so severely. Like, he pouted them so hard. There was no response. You're just a guy working for an old agency, and you've got your clients, and these 20 CAA mother****** are showing up. And like, yeah, it's this force. And the clients, if you talk to, by the way, a lot of his clients are still active today from the period. If you talk to them, it's just like, yeah, it's just a no-brainer. It's like, do you want to work with a guy or do you want to work with a firm? It's just obvious. I don't know if he told you all these stories. Did he tell you about his morning schedule thing?

David Senra: The getting on the bike, doing the karate training call?

Marc Andreessen: No, for the firm.

David Senra: No, no, no, no. I don't remember this.

Marc Andreessen: So this is, again, something that's specific to Hollywood, but it's a great example of the... Okay, at the time he started CAA, the agency business was like 90 years old or something, right?

David Senra: Yeah.

Marc Andreessen: It started out doing Vaudeville bookings and music halls, and it had been around for decades. And so, the people involved in it had had decades to think about the best way to do it, and they had arrived at a set of practices. And one of the practices, I think I'm getting this right, one of the practices was at every agency, they would have their staff meeting in the morning at 9:00 a.m., and whatever information was going to get shared in the agency would get shared at that point. And oh, this studio head wants a script to do. He wants to do a crime thriller, and here's the script and whatever. And then, this is the point where there would be minimal, whatever, minimal handoff existed to the other agency. And so this is where everybody would kind of get updated. And so, the staff meeting would go from 9:00 a.m. to 10:00 a.m., and then at 10:00 a.m., they would start calling their clients. And they'd be like, "Oh, we heard there's a whatever. There's going to be a casting call for this great new role for this professional thief or whatever, and you should consider doing that."

David Senra: Mm-hmm.

Marc Andreessen: And so, of course, Michael's like, "All right. Well, we'll have our staff meeting at 7:00 a.m. We'll be done at 8:00."

David Senra: Yeah.

Marc Andreessen: "Between 8:00 and 9:00, we'll call the clients. By the way, we won't just call our clients. We'll call their clients." Right? And so imagine you're, whatever, Paul Newman, and you've got some agent you've been working with for 20 years. Your agent calls you at 11 o'clock, and he's like, "I've got this great role." And you say, "Oh, the guys at CAA called me about that three hours ago." And your agent's like, "They don't represent you." And Paul's like, "Yeah, isn't it great? Isn't that fantastic?" And so you just, again, you rinse and repeat that a thousand times, and to the client, it's just completely obvious what to do. And so yeah. So the reason I go through this, the moral of the story is, again, it's sort of this idea, incumbency status quo. Like you just end up, you end up in any business, you just end up with all these embedded assumptions. Generally, and then 90 years later, right? So the founders of the agencies 90 years ago, they weren't involved anymore, so the people who were running competitive agencies were managers, same thing, managers, not founders. Right? But the thing a manager never does, unless they're under duress, is reconsider fundamental assumptions. They hate that. The whole point of running something big is you don't have to do that. You get to run the big thing at scale. You don't have to go in and reinvent it from scratch. That sounds like a nightmare, right? But anyway, as a consequence of that, you end up with all these embedded assumptions that are basically just unspoken. Nobody's questioning. It's not happening. And if you take the time, you can kind of go in, first principles, you can kind of go in, and you can say, "Okay, well, how did they arrive at that?" And what we've found in just industry, I mean, this is what our founders do every day, is just in industry after industry after industry, there's all these embedded assumptions that made sense in 1970 or 1930 or 1880 that just don't make sense anymore.

David Senra: I love that you did that. I always say it's not what you do, it's how you do it. And if the idea that you could take... I'm like, I'm not running a talent agency.

Marc Andreessen: Right.

David Senra: But there's so many of these principles that I could apply to venture capital. In your blog archive, which I absolutely love, and I told you I've read multiple times, I did episodes on it, you would give advice to young people. And it's, my advice is go work in an industry where the founders of that industry are still working.

Marc Andreessen: Right.

David Senra: When I read Ovitz's book, the way I would summarize his approach, because he is in this big, stodgy, slow-moving, very bureaucratic organization, is like, oh, mediocrity is always invisible until passion shows up and exposes it.

Marc Andreessen: Oh, interesting. Yes, right.

David Senra: And that's what he did.

Marc Andreessen: Yeah, that's right.

David Senra: He's just like, "There's so many things you guys could be doing better here. I can't do it in the..." And if I remember correctly, he took some of these ideas to his boss.

Marc Andreessen: Oh, yeah, yeah, yeah.

David Senra: Because that guy was his mentor. I can't remember his name. Yeah.

Marc Andreessen: He famously worked for the CEO of William Morris.

David Senra: Yeah.

Marc Andreessen: Yeah, which was the biggest of the talent agencies at the time.

David Senra: Yeah. So were you and Ben essentially just designing what you wish you had when you were founders?

Marc Andreessen: Yeah, that's right. And again, that may be a cheat code, but yeah, if you've been the customer, obviously, this all becomes a lot more obvious.

David Senra: And I don't know if you want to answer this question or not, but in Warren Buffett's shareholder letters, he has this great line where it's really important to pick, to play against weak competition. Did you feel like that point in time in venture capital history, that you were going to be playing against weak or weaker competition?

Marc Andreessen: Mm-hmm. I would say not exactly. We didn't view them as weak. We viewed them as basically, we viewed them as running on a status quo set of ideas. And to be clear, and part of why we think about it this way, we had raised money from at the time, in the time we were probably the two best venture firms, so Kleiner Perkins in the 90s, and I worked with John Doerr very closely for five years in Netscape, and then Cloudflare, we raised money from Benchmark when they were like king of the hill, and Andy Rachleff, who was one of the founders of the firm, and is a legendary, brilliant VC. And so we had worked with, we just had through accident of history, we had worked with two of the, whatever, top five or whatever people in the field for a long time. And they were and are, by the way, brilliant at running on the model that existed. Like John was brilliant at that, Andy's brilliant at that. They're still brilliant today. It was less a competition of, oh, these people are soft, or these people aren't smart. It was none of that. It was, "No, they're really good at executing against this particular playbook." And by the way, that's why it's okay. Like, if we're going to do this, we need to be playing by a different playbook.

David Senra: There was no such thing as scaled venture capital at the time.

Marc Andreessen: No. At the time, no. Because the firms, they all hit this limit. They all fundamentally hit this limit. They all hit this limit where the idea of a partnership of equals or even a hierarchical partnership, like it just breaks at some point because there's just too much internal dissension. It is too hard to coordinate, and then everybody's fighting for slices of what was viewed at the time to be a fixed-size pie. And so none of the other firms could... Structurally, there was just no way to get to scale.

David Senra: Where else did you take ideas from besides the agent business in Hollywood and the merchant bank, investment banking industry?

Marc Andreessen: Oh, I mean, it was just very obvious that it happened in private equity. This was the time when it was actually really, this was around the time when KKR and firms like it were hitting their stride with, they're actually building a lot of operational capabilities in-house. They were actually building their own investment banks in-house.

David Senra: Yeah.

Marc Andreessen: One of the things we've never done, but has always been on the ideal list, is to actually just have an in-house bank. And KKR had actually done that, just build a captive bank. And so, they had done a bunch of things like that. So we saw it happening, which is the mid-tier private equity firms were collapsing, and you either needed a solo, very light, on your feet kind of solo operator on the one side doing small deals, or you needed to have a scale platform like KKR. It happened in hedge funds. It happened in... Actually, the TV show "Mad Men." Mad Men tells the structural story of this happening in the advertising field in the '60s and '70s. And I will ruthlessly spoil "Mad Men" because it's been off the air for like 20 years at this point. But a big part of the arc of "Mad Men" is those guys are working... Sterling Cooper is a classic mid-market ad agency, right? And then at the end of whatever, the third season, they sell it to McCann, which was the scale player at the time. And they show you all the pros. They clearly talked to people who had been through this because they showed you all the pros and cons of working for McCann, because McCann's this giant machine. And so if Don Draper's used to making all the creative decisions, and now he's just in this conference room arguing with people until he just gets up and walks out. But then, Don Draper and Roger Sterling start their own startup. They start Sterling Cooper Draper Pryce. That's the second one, which starts out as a true startup, as a true boutique startup. And then they have this, whatever, year and a half of just f***** hell. Like, they can't get anywhere. They can't get clients because they're too small.

David Senra: Yeah.

Marc Andreessen: They're subscale. And then I think in the end, I forget this venture line, but I think they end up selling it. No, no, no, no, no, no, no. Sorry. I got it wrong. They sell the first one to the British ad agency that just completely destroys it, and then they sell the second one to McCann.

David Senra: Mm.

Marc Andreessen: So, they actually show that process happening twice. Again, if you go back in history, that is what happened to the ad agencies basically between the '40s and the '70s. Basically, television catalyzed that. When television emerged, advertising became a much bigger deal than it had been before, and it had to be professionalized in a different way. The other thing that happened is, of course, the external environment changes, right? So, everything we just talked about just has to do with the internal mechanics of how these things run. But the other thing happens is the external environment changes, right? I think what Michael would say, I think he would agree with this, part of what made CAA possible is at one point, basically Hollywood was just movies. And then there was whatever, a low kind of TV division. And by the '70s and '80s, the Hollywood was becoming much bigger than just movies, right? It was movies and TV and advertising and music and sports and politics and culture and all kinds of things. In fairness to kind of our competitors, Silicon Valley between, call it 1950 to 2010, was primarily just in the tools business, right? Primarily, the companies that starting with Hewlett-Packard, the companies that we all backed and built, were basically just building tools, and you'd build a tool like an operating system or a disk drive or something, and you'd sell it to people, and they'd figure out what to do with it. It was right around the time we started our firm that the Valley was going from being primarily tools businesses to actually building directly competitive companies in incumbent industries, right? And so Airbnb going directly into the hospitality industry, right? So, alternate universe Airbnb is just boutique booking hotel software, right? For an Airbnb. So it's a tiny little boutique business building basically a little spreadsheet software.

David Senra: Mm.

Marc Andreessen: But no, Airbnb, Brian Chesky decided brilliantly, "We're just going to go into the hospitality business and compete with hotels directly." Uber and Lyft in the old world were just taxi dispatch software. In the new world, they're full transportation providers. Tesla in the old world would've just been software for self-driving cars. Tesla in the new world builds the entire car. By the way, Facebook, same thing. Prior to Facebook, if you built online ad software, you were selling it to the media companies. Mark's like, "No, we're just going to be the media company. We're just going to build the entire thing." And so this was the other thing that happened for us, was that that was right around the pivot point when the Valley's ambitions went from just building tools to going directly into incumbent industries. And then, this goes back to the scale thing. It's like, okay, why do you need to scale a venture firm? Was because the companies need to scale, right? And then of course, AI now makes that crystal clear, right? Because the winning AI companies are raising billions, tens of billions, in some cases hundreds of billions of dollars, right? The old world of 10 million or 30-million-dollar or 50-million-dollar checks, where VCs tap out, is just not a relevant thing anymore.

David Senra: But did you know the scale was changing at the time you founded the firm?

Marc Andreessen: We had a pretty good idea. So, I'd been involved with Facebook, basically informally since inception, and then formally on the board since 2007. And that thing hit the knee in the curb. It was just very clear. To us, it was just very clear that we didn't know how big it was going to get, but it was going to get much, much bigger than the internet 1.0 companies had gotten. And so there was that. What else? It was also around the time Apple was directly entering the cell phone market, which was another great example of this. Silicon Valley didn't used to make cell phones. The original cell phones weren't made by Silicon Valley. They were made by these giant industrial companies like Sony and Nokia and whatever, and Motorola in Illinois or whatever, and then Silicon Valley would make the chips that go into them or the software. And of course, Steve was like, "Yeah, no, screw that. We're just going to make a phone," right? There were these signals that it was happening, and then the other thing was just the internet itself was maturing, right? And so, at that point, the consumer internet was 15 years in and we had seen every part of that. I forget what the number was, but that was probably around the time the global internet penetration was crossing a billion users on its way to five billion.

David Senra: Yeah, you have a very interesting lived experience where you were there at the very beginning of the internet. One thing that I'm fascinated by, and this actually was going to be the first question for you, because I've never heard you speak about this, at least on a podcast, but your partnership and relationship with Jim Clark.

Marc Andreessen: Yep.

David Senra: You were what, 20 when you met him? How old were you?

Marc Andreessen: I was old-fashioned. I actually graduated from college and got my degree. It's a very Stone Age concept these days. So that was in 1994. So, I was probably 22.

David Senra: So, there's this great book, I don't even think you like the book written by Michael Lewis, "Silicon Valley's Story."

Marc Andreessen: I've skipped it.

David Senra: I've read it twice, just because I don't know if anything's in there is true, but the portrait he paints of this very eccentric character is just wildly entertaining to me.

Marc Andreessen: Yeah.

David Senra: But what's shocking to me is when you talk to young founders, I'm like, this guy started three... I think he was the first person in history just to found three separate billion-dollar technology companies.

Marc Andreessen: I think that's right.

David Senra: And almost no one knows who he is.

Marc Andreessen: Yeah.

David Senra: Can you just talk about how you met him? What was like working with him?

Marc Andreessen: Oh! I knew exactly who he was, and the reason was because his company, Silicon Graphics, his first company, they were the company in the Valley, between call it, yeah, '87 to '94 or something. They were like, whatever, Google or OpenAI or whatever comp you want to make. They were like the company. And by that I mean they were the company where the smartest people in the industry all wanted to work there. They built the products that were the coolest products you could possibly imagine. They had this incredibly young and vibrant, and dynamic culture. And then they hit this cultural moment that was just incredible in, I think, '92, which was the turning point in the movie business when computer graphics really kicked in. And the two movies back to back were "Jurassic Park" and "Terminator 2."

David Senra: Run on the machines they made.

Marc Andreessen: Built on the machines, the technology they made.

David Senra: Yes.

Marc Andreessen: Technology Jim invented was the technology that made that possible. And those are still two of the great all-time movies. But at the time, I mean, I still remember the chills that you get seeing dinosaurs on screen. It's just like, "This is..." and then there's this company that builds the machines that do this. By the way, the Silicon Graphics computers are actually in the movie. There's a scene in "Jurassic Park" where the kids are navigating through Unix.

David Senra: Yeah.

Marc Andreessen: And it was actually the 3D software. Those were actually the Silicon Graphics computers. That was this moment where they're just the absolute it company of all time. But by the way, their legacy lives on in Nvidia. Nvidia is Silicon Graphics', basically, it's like a Traitorous Eight thing. It had to be a new company for reasons we could describe to do the GPUs instead of the workstations and servers. Nvidia fundamentally is based on Jim's ideas. That's where that stuff all comes from. And so, he was already legendary. And again, he was one of these... He was the full deal. He was legendary as an innovator in technology because he has a PhD in computer science, and he himself invented the original, forget what they call it, I think it was the reality engine. The original interactive 3D graphics on a chip thing was actually him, I think it was his PhD thesis. And then he started the company, and then he ran the company. By the way, and then the VCs brought in a professional manager. By the way, and the reason we know about Nvidia today and not SGI is because of this founder-manager issue, which we can talk about.

David Senra: No, let's talk about that real quick.

Marc Andreessen: Yeah, yeah.

David Senra: Because I don't remember this part of the story.

Marc Andreessen: Yeah. By the way, there's two sides to the story. And I wasn't there. And so, I just reflexively side with Jim Clark, but I'll try to at least represent both sides of the story. So Jim, I don't even remember what's in the Lewis book, but Jim is like a true Elon, Steve Jobs level guy. And so, incredibly creative, incredibly bright, incredibly charismatic, but he's volatile. Like, he's exciting. He's exciting. It's like being around him is just incredibly exciting. There's always something new. He always has new ideas. And again, that was in that time where it's just like, okay, that's the personality type that clearly can't run the company. And so the VCs brought in a guy out of Hewlett-Packard, who had been trained at Hewlett-Packard. Because at the time, what happened is he wanted to hire a professional CEO. He went and hired a general manager out of either Hewlett-Packard or IBM, were the two training grounds for this guy. So they brought in a really, really sharp guy. I don't really know. I think I met him once. I don't really know. By all accounts, he was like a very good example of this kind of HP general manager type who became a CEO. He took over the company. And by the way, in his defense, under him, the company scaled enormously. I forget when he took it over, but it was like '87 or '88 or something. And then by the time I got to the Valley in '94, this company had become huge, and whoever's running the company gets at least some credit for that. But anyway, they got in this classic fight. They got in this classic fight, and the classic fight was, it's the same story every time. The founder is like, founder is talking to CEO, and the founder to the CEO, like, "We need to do things completely different." And the CEO's like, "No, like what we're doing is working. Stop f***ing with the thing that's working." And the founder is like, "No, it's working now, but it's not going to work in the future." And the CEO's like, "Well, then we'll deal with it in the future." And the founder is like, "You can't wait to deal with it in the future, because by the time the future arrives, it's going to be too late." And the manager is like, "Why are you in my pants? I'm making you all this money. The company's super successful. Like, get out of my shorts." Right? And you see this, and that was exactly the deadlock that they got into. And Jim Clark basically made two predictions as the founder of Silicon Graphics. So, Silicon Graphics at the time was selling... Their computers, basically started list price at like 50,000 dollars for a desktop workstation and then scaled up into the millions. And Jim was like, "Look, two things are going to happen." It's amazing that he... And he figured this out by 1991 or something. He said, "Two things are going to happen." He said, "Number one, everything that we sell today for 50,000 dollars is going to go on a chip, and that's going to go on a card, and it's going to go on a PC, and it's going to cost 300 bucks. And either we're the company that's going to make that, or we're going to get destroyed," right? Which, by the way, is what happened. That's Nvidia. Like that's what actually happened, right? So, he was completely correct about that. The other thing that he had was, he's like, "Look, this idea of standalone computers is not going to be the thing. These computers are all going to get networked together, and the network is going to become the important thing." At the time, there were different terms. People were using terms like information superhighway, or video on demand, or 500 channels. You had all these kind of concepts kind of coalescing around what became the internet. And even before the internet kind of became a mainstream thing, Jim was just like, "Look, it's just inevitable that this is all going to become connected, and then the function of a computer is no longer going to be mainly what just the computer does. It's going to be the fact that it can talk to all the other computers. And we need to do that." And to do that, he actually went to Japan. He actually got this incredible deal. Nintendo then and now is like this giant video game company. So he actually had this deal with Nintendo, where number one, and Silicon Graphics actually did this, actually built the original 3D graphics chip for a consumer game player, the Nintendo 64. So he did that deal, and then he went to Time Warner, which at the time was this very important media company doing all kinds of things. And he struck a deal with them to do what's called interactive TV, which was basically pre-Internet. Basically, it was like Netflix before Netflix in like 1991, right? Like, amazing foresight, right? Just like amazing foresight. But again, he and the CEO got in this conflict, and the CEO's like, "Look, we just can't, we have to focus on the thing that we're doing. We're not going to do these things." And so Jim did the classic founder thing, and he left. And when I met him, basically, that was the state that he was in, which was, "Okay, I, Jim, am in the prime of my life. I know I have all these ideas. I don't know exactly what to do with my next company, but I know it should be a software company, not a hardware company. I know it needs to be a company that is able to anticipate these changes that are happening in the world. And I know that Silicon..." And he was very sad about this. "Silicon Graphics is not the company that's going to be able to do these things, and so I have to build the new company that's going to do it."

David Senra: Brad Jacobs has started eight separate billion-dollar companies. He said, "I've come to know a lot of extremely successful people in my life, and they all have one thing in common. They think differently than most people. All of them, to a person, have rearranged their brains to prevail at achieving big goals in turbulent environments where conventional thinking often fails." What Brad noticed is that great business leaders are pattern spotters, but you can't spot patterns if you can't see all of your data. Most businesses only use 20% of their data. Why? Because 80% of customer intelligence is invisible. It's hidden in emails, transcripts, and conversations. That's where HubSpot comes in. With HubSpot, all of your data comes together so you can see the patterns that matter. This is important because when you know more, you grow more, and that is a pattern that never fails. Visit hubspot.com today. That is hubspot.com. I wanted to hear more about what it was like working with him, but there was a very astute observation you made in your blog archive because you were trying to, essentially this post was trying to educate founders, just like recruiting is the most important thing you're doing at the very beginning of a company, maybe forever, and you're underestimating how difficult it is, and you tell the story of Jim Clark in the blog archive. You're like, "This guy was a legend."

Marc Andreessen: He was, yeah.

David Senra: Like, most famous person, best entrepreneur, and he's like, he tried to recruit all these other people, and I don't know, it was like 100 people, and you're like, "You were one of two or three that actually followed through and took the chance and jumped and started working with him."

Marc Andreessen: Yep. Yeah, again, this is like, I don't know, Zuckerberg or Sergey Brin or Elon or whatever decides to start a company. That was his candle power wattage in the community at that time. And so, yeah, you would think that the obvious thing people would just say, "Jim Clark wants us to start a company with you," just the obvious thing is you just say yes. It was not happening. I don't know if I told this story, but the crystallized memory is a dinner of 12 of us at Il-, this famous Italian restaurant in Palo Alto called Il Fornaio. It's where a lot of these companies were formed, it was Jim's favorite restaurant at the time. And so Jim had like a dozen of us, and us being people who were in existing companies, who were basically technical people who he knew. Well, this is the thing. He was constrained. He had a non-solicit agreement with Silicon Graphics, and so he couldn't just rip people out, and he didn't want to violate that. And so he needed to basically reach out to the technical community and find new collaborators.

David Senra: Mm-hmm.

Marc Andreessen: So there were like a dozen of us in there. And I remember that dinner very precisely for two reasons. Number one is I was the only one of the dozen to say yes, and then the other was it's the first time in my life I drank red wine. And I didn't know what to make of it. And so, I kept sipping it, trying to figure out if I liked it or not, and I didn't realize that I was getting completely hammered, because I had no idea how to calibrate red wine. And so, the true version of the story is, I leave the dinner, and I'm like, "Wow, this is amazing." Like "I'm going to say yes to this. We're going to do this." And I go to my car in the parking garage in Palo Alto across the street, and my brand new car, my first new car I've ever owned, right? My brand new car. And I gun it, and I pull out, and I rip the entire front end of the car off. It's like this screaming metal sound. So the whole front of my car is just hanging on the ground, and I'm like, "Oh, f*** me." So anyway, I park the car, get out of the car, walk home.

David Senra: No Uber this time.

Marc Andreessen: No Uber. I'm just like a three-mile walk at whatever, 11:00 at night with six bottles of red wine.

David Senra: And you're what? 22?

Marc Andreessen: No problem. 22, yeah, exactly.

David Senra: Crazy.

Marc Andreessen: I'm like, "I think I probably won't mention this to Jim.”

David Senra: I don't know, there are some wild stories in that book. He might have admired you even more.

Marc Andreessen: He might have. Yes.

David Senra: How many founders of the company? It's just you and him?

Marc Andreessen: So, yeah, originally it was him and me. Yeah, we started the company, and it was again one of these things where we had long conversations about what to do.

David Senra: Okay.

Marc Andreessen: Well, okay, so then the problem that he had was... There was the idea of doing the graphics chip, and again, that’s what NVIDIA did. But NVIDIA was essentially a spin-off of SGI. But at that time, starting a new chip company from scratch would’ve been tough, and he didn’t want to compete with SGI doing that. And then the interactive... What you would call the interactive is lost to history, but this interactive television, it wasn't time for that yet. There wasn't actually time for Netflix yet. And so it was going to be cost-prohibitive. Time Warner had rolled out this interactive television thing in Orlando, Florida, to 500 people.

David Senra: Yeah, and Microsoft was involved in some way.

Marc Andreessen: They were doing a ton in Oracle.

David Senra: Yeah.

Marc Andreessen: At the time all the big companies were-

David Senra: It's all these Bill Gates biographies. Yeah.

Marc Andreessen: Exactly. He talks about that a lot. But the CapEx per house was like 50,000 dollars or something, because you had to have a Silicon Graphics workstation in the house, and it wasn't going to work. So he couldn't figure that out, and then we cycled through a whole bunch of ideas. He actually went back to Nintendo, and we almost pulled the trigger on basically building what today you'd call Xbox Live, or what is it called? PlayStation Network or Xbox Live?

David Senra: Yeah.

Marc Andreessen: An online gaming service for the Nintendo 64 in 1994, which might've been a good idea. We thought it was too early. We almost did that, and then what happened literally was the internet... I had worked on the internet in college, and then, this is fortunately only a few months later, but the internet just kept growing.

David Senra: Hold on, Marc.

Marc Andreessen: Yes.

David Senra: You had worked on the internet a little bit?

Marc Andreessen: I had worked on the internet.

David Senra: That's a little bit modest.

Marc Andreessen: Yes, well...

David Senra: I think a lot of people listening to this will know, but you should probably explain how you were working on the internet.

Marc Andreessen: So this is part of the story. At the time, it was not that big of a deal. It's not nearly that much big of a deal at the time as it's viewed now. So, the internet... I've told this story many times, so I won't go into huge detail, but yeah, a group of us at Illinois did this thing called Mosaic, which was the first, as I said, widely used web browser, than the first one with graphics.

David Senra: Explain what was different about what you made compared to what existed before.

Marc Andreessen: Yeah, so the previous web browsers were text-based. There was this nascent concept of the web, but it was text-based terminals, and then it didn't have graphics. It wasn't point-and-click. It didn't work in the way that you would expect this type of software to work. And then, by the way, it didn't also have scripting language, no security, none of the actual capabilities that make the browser a useful thing. And so there was this nascent idea, but it needed to get built into a full thing, and so we built the original kind of full thing, a full browser, at Illinois. And then we also built the first kind of mainstream web server, like the first web server, again, that kind of had everything that people needed. This had been a project at college, and again, at the time, the internet was not viewed as a consumer phenomenon.

David Senra: Wasn't it illegal to commercialize? Steve Case of AOL tells a story that he had to  lobby and get a law changed.

Marc Andreessen: Yeah. Yeah, that's right.

David Senra: What were the details there?

Marc Andreessen: Yeah. So the internet as we know it today, in the 1980s, was called the NSFNET. NSF stands for National Science Foundation, which is a branch of the U.S. government that funds research, and the National Science Foundation funded the internet. The reason I was able to do the work, I was able to do it at Illinois is because the NSF had actually dumped a ton of money into four universities around the country to build what were called the supercomputer centers, and then those were also the main hubs for the NSFNET. And the function of the NSFNET was fundamentally to connect the supercomputers to all the people who were going to use them. So it was this government research academic program, and it was very exciting in the technical field. But there was no conception that ordinary people were ever going to use any of this. Nobody thought that this was a thing that normies were going to use. And NSF, it's taxpayer funding, so the government at least is not supposed to be funding businesses directly, although sometimes they do. But there were formal legal restrictions on funding things with commercial applications. And so what there was was there was something called the AUP, the Acceptable Use Policy, and the Acceptable Use Policy said that basically the internet, the NSFNET turned internet, was for academic and research use, and commercial activities were strictly prohibited, literally not allowed. And again, it's just like, as a taxpayer, that makes total sense. I'm glad my tax money's not going to fund something like that. But as a user, you're just like, "All right, that's nuts." That's clearly crazy, right? And if you took the conceptual leap to say, "No, this is going to escape the lab, and this is going to be something that normal people are going to use," then it just became obvious that it would have to have commercial activities. Yeah, and then AOL was one of the early pre-internet online services that wanted to connect to the internet. I think they famously connected to the internet in 1993. Do you know about the concept of Eternal September?

David Senra: No.

Marc Andreessen: Oh, okay. So there are two internets. There is the internet that existed before 1993 and the internet that existed after 1993. People who were on the internet before 1993 often describe it in utopian terms, because it literally was like you take the whatever million smartest people in the world and you put them on a network together, with no commercial activity, no advertising, no nothing, just the million smartest people in the world, and you just let them talk to each other, and it's just amazing. It was amazing. Like, there was this... The old messaging system was called Usenet, and the discussions on Usenet were just absolutely spectacular. It was amazing. It was the most pure, clean, intellectual, vibrant space since, I don't know, Athens in 500 BC. It was just this amazing phenomenon. And then AOL connected. AOL had, I don't know, whatever, a million or two million people at that point. They connected all the AOL users, which were just normal people, to the internet in September 1993, and that became Eternal September. That's the day the internet changed. And by the way, I'm pro that, I'm glad that happened. But the pro and the con of that is that took the internet from this ivory tower kind of thing to this basically mainstream consumer, ordinary people thing, which is, of course, just a fundamentally different thing, obviously, right? The concept of Eternal September literally was when every new wave of college graduates graduated and got their first job, and then went online. September is when the new crop of internet users showed up for a long time, so the "September effect" didn't just happen once. It happened over and over and over and over and over and over again. And every cycle of internet users would basically be like, "Oh my God, this is great, but it's all going to get ruined in September."

David Senra: Yeah.

Marc Andreessen: Right? And so the internet that we live in today is the result of-

David Senra: If they could only see us now.

Marc Andreessen: 30 Septembers, right? But yeah, and by the way, there was controversy at the time about whether the Acceptable Use Policy should be revoked. There was controversy over whether normal people should be on it or not. There was controversy over whether the kind of content normal people wanted to be on it should be allowed to be on it. There was controversy about whether there should be... There was controversy... We got quite a bit of flak at the time for putting images into web pages, under the theory that that would fundamentally make everything worse because you'd have normie content, and that would be bad. And it's the same about e-commerce. By the way, advertising, I remember there was actually a moment that... There was a guy named Sanford Wallace, and he became known as "Spamford Wallace." He literally sent out the first spam message on the internet in 1992. And literally, it was the first internet ad, and it was a spam for, I don't know, whatever, legal services or something. He just drops it on the UseNet, and it was like a thermonuclear explosion, because it was like, "Get this commercialized crap out of my newsfeed." So all of these things were hot and controversial. I was generally on the other side of all these arguments because I was like, "Look, this thing is great. Obviously, everybody should have access to this. Obviously, we need to connect everybody to this. Obviously, to do that, these need to be businesses, there needs to be commerce. There needs to be advertising. All these things obviously need to happen."

David Senra: So was that the discussions you and Jim were having, where you're like, "Okay, we're going to start an actual company around this"?

Marc Andreessen: Yeah. So yeah, that's how we got to the conversation Jim and I had, which was basically like, okay... Because that was right at the pivot point. This was in early '94, so the AUP had just been revoked, and AOL had just done the first September, and the whole thing was just about to tip. And I knew that because I was tech support for the browser personally.

David Senra: No, explain that.

Marc Andreessen: Just me. Well, Mosaic at the time was the browser everybody used, and so if you used Mosaic, there was a Submit a Bug report or whatever, "You have a question, submit it here," and that went to an email box, and that email box was me. So I became tech support for the internet. For like three years.

David Senra: How?

Marc Andreessen: I got all the emails.

David Senra: How many emails were you getting?

Marc Andreessen: Well, there were actually two. That was one email box, and the other email box was... Mosaic was actually created under... It was also funded by the National Science Foundation. So it was actually not... The original license said it couldn't be used for commercial use, it was for academic, research, and individual use. So, we had this thing. We did a deliberately ambiguous license, and we said, "If you want to use the browser commercially, you need to email us to arrange terms." Now, we had no concept at all of what those terms would be, but we just said we need to create this incoming flow. So I was getting bombarded with tech support requests. And by the way, tech support for the internet means you're tech support for everything. So it's like the old PCs had CD-ROM trays, you press the button, the CD-ROM tray comes out, you put the disc in the thing. The problem is a lot of people thought that those were cup holders, right? So you press the button, the cup holder comes out, you put your cup of coffee down, and then 10 seconds later, the cup holder retracts back into the PC, spills your coffee all over the place. You're like, "How the f*** do I keep the cup holder out," right?

David Senra: Let me email Marc.

Marc Andreessen: Yeah, let me email Marc. It's like, "Sir, that's the CD-ROM drive." So there was a lot of that. One of the funnier things you can always do, in politics, they call this "focus groups," but you could do user testing. You see this over and over at tech companies, take whatever amazing new thing you have and just put it in a room with normal people and let them try to use it. You just learn so much about how much of a bubble that you're in, about the kind of things that you're familiar with, that normal people are just like, "I don't know what the hell any of this stuff is."

David Senra: Yeah.

Marc Andreessen: So there was a lot of that. But then I had this other email box, which was all the commercial licensing requests. And so I saw the consumer takeoff on the one side, and then I basically, I think that... And then the commercial requests hit 400 messages of people wanting to pay money for this thing. And so I basically took those to Jim, and I was like...

David Senra: There's a business.

Marc Andreessen: Yeah, this is going to happen. And then we actually went to... My old boss at NCSA actually had gone to... We actually went to Washington in '93 to try to get NSF funding to staff a support desk so that it wasn't me answering all of the emails. And the National Science Foundation people were very nice, and they were like, "Yes, the National Science Foundation is not in the business of funding customer support desks for your software." And so I still have the denied NSF grant that would've kept the whole thing an academic project. But yeah, at that point,  at least to Jim and me, it was just obvious that that was going to be a business. By the way, again, very controversial, the original press coverage on Netscape for the first year was that these people would never make money. Like, this is ridiculous. Everybody knows the internet's free. Everybody knows that none of this is going to work, so even then it was controversial.

David Senra: What did you think the business model, though... Was just literally licensing it?

Marc Andreessen: It was a combination of things. So it was definitely software licensing, and we made this thing up where the browser was free, but the server software cost money. And then, out of the gate, we started building all these, we called, applications, server-side applications. So we built the first publishing system for running a newspaper or magazine online, a content management system. We built the first e-commerce system for selling... This is pre-Amazon, so we built the first e-commerce system for selling things online. So we built and sold a lot of that software. And then we owned the main website that the browser had as its default homepage, and so we built the original internet advertising business, was basically... So Netscape was the largest internet advertising company until, I think, '97.

David Senra: That's incredible. I didn't know that.

Marc Andreessen: When Yahoo passed us, yeah. And so yeah, we invented, or people at the firm invented, at the company invented... I don't know exactly who gets credit, but the original ad formats were right around that time, and a lot of them rolled out on our site first. So it was literally advertising pre-Yahoo. It was e-commerce pre-Amazon. It was, yeah, content pre-... We literally sold... I mean, we put The Wall Street Journal online. That was our software that did that, and a lot of other newspapers, magazines, and all that stuff. And so yeah, it was a lot of that, and then it was the web operation. And again, it all looks obvious in retrospect, but again, it was like, okay, when we started this... I don't know what the total number was. So we started the company in April '94. There couldn't have been more than two million people total online, right? And then almost everybody was coming in over dial-up. This is like pre-broadband, right? So everybody's coming in on, like, 14.4 kilobyte modems, and we're hoping that people are going to upgrade to 56 kilobyte modems, that that would be like super helpful.

David Senra: Yeah.

Marc Andreessen: Computers at that time did not come with TCP/IP installed, so to get your PC actually on the internet, you needed to buy a TCP/IP stack. Try explaining to a normal human being what a TCP/IP stack is. It makes no sense at all.

David Senra: They're going to ask if they can put it next to their cup holder.

Marc Andreessen: Exactly, yeah. It was just like talking to Martians, right? Their talking to us was like talking to Martians. And then monitors were like three feet deep, and just bathing you in radiation. You're kind of hoping that the radiation stays up here and not everywhere else. In retrospect, it was super early, and it was all very... And then again, it was just like, "Okay, e-commerce, are people going to buy things online?" It's like, "I don't know, maybe." But the press at that time was just like wall-to-wall, like, "If you put your credit card number online, hackers are going to steal it."

David Senra: I was going to say, if you read any books that were around this time, they're like, "There's no way in hell anybody's ever going to put their credit card on the internet."

Marc Andreessen: Yeah. Yeah. But by the way, the other thing you would never, ever do is put your real name online because it would be immediate identity theft, your life would be ruined. So you would never ever do that. By the way, the other thing was right in the beginning, you had all the panic around kids, "This is going to destroy children, this is a huge risk to children." So you had all that panic. And then there was immediately the beginning of the calls for censorship. There's clearly all this stuff that you have to take down. The New York Times kept running stories talking about how the whole thing was fake anyway. They kept saying that all the numbers were made up, and there actually wasn't anybody online. It was like a tiny little user base, and we were all inflating the numbers and committing fraud. So it was just this... In retrospect, it's all quaint and cute and sweet, but it was like the precursor. It was all the moral panics around technology today.

David Senra: Okay. But...

Marc Andreessen: You could see nascent versions of them back then.

David Senra: You pick up on something that... Because me and you have read a bunch of the same books, where it's like, humans' reactions to something new is just consistent throughout history.

Marc Andreessen: Yeah. Yeah.

David Senra: And so I heard a podcast with you. I thought I was the only one that would tell the story in private about bicycle face.

Marc Andreessen: Bicycle face. Exactly.

David Senra: Do you want to say what bicycle face is?

Marc Andreessen: Bicycle face. Bicycle face. Bicycle face, yes. So it basically turns out every new technology is greeted with what they call a "moral panic," right? So, a moral panic basically is, whatever this new technology is, or this new form of media is, it's going to ruin everything. Specifically, it's going to ruin society, it's going to ruin morality, and then, especially, it's going to ruin the children. And then back... The bicycle was pre-feminism, so it was also going to ruin the women very specifically. It's going to ruin the women, because women, clearly, in 1880, cannot be trusted to use a bicycle without getting into real trouble. I'll explain why. So this is this persistent theme, and basically you go all the way back, and this is like this famous thing where Plato and Socrates thought that, basically, written language was a big mistake, that all information transmission should be oral, and they had this whole thing back in 500 BC. And then it was just like every... You just have to imagine. So I always like to hypothesize that the first guy who brought fire, like, down from the mountain.

David Senra: They probably killed him.

Marc Andreessen: Yeah. They're like, "What the f*** is this?" Right? Exactly, like, "This thing is horrible. This thing could burn down the village. This is awful. This is going to destroy everything." And so it's just been this consistent thing. There's this great website called Pessimist Archive, where these guys go back and they find all these newspaper articles that are contemporaneous to these things. But it's everything. So when I was a kid, it was like heavy metal music, Dungeons & Dragons, like all this stuff was awful. I remember the moral panic around the Walkman, the very first portable cassette player with the headphones, because it was going to destroy society because everybody was going to just be listening to their own music. I remember the moral panic around the calculator, it was going to destroy education because kids were not going to learn how to do math anymore. And then you go back, and it's like in the '50s, it was like comic books, and it was rock and roll music, obviously, it was going to ruin everything. In the '20s, by the way, jazz music was going to ruin everything, playing cards were going to ruin everything. What else? Novels, paperback novels, were taking... Kids were going to sit around and just read novels all day instead of doing any real work. So it's just over and over and over again, it's this constant story. So the bicycle one is the great one. The bicycle rolls out in like 1870, 1880, and so the U.S. still, at that point, was thinly populated from today, but the West had been settled. So you had all these little towns and villages scattered all over the place, but to get from one town to the next was like 5, 10, or 15 miles, and people didn't generally walk that. And so the bicycle comes out, and all of a sudden it's easy to go five miles into the next town. And then young people discover the bicycle, and they discover that there are young people who they didn't grow up with who are in the next town over, and they head out to do it. And so the specific-

David Senra: "To do it."

Marc Andreessen: Well, to do it, yes. To do everything. To do whatever it is that young people do, they're going to head to the... Yeah. Because look, it's just the nature... If you've known the same group of people since you were two, you're going to want to... Yeah, it's going to-

David Senra: What's over that hill?

Marc Andreessen: What's over that hill? Yes, exactly. Right. I grew up in a small town. I can identify with that. And then specifically at that point, young men, obviously, but specifically young women started to do the bicycle. And so this was a big threat. And so, if you're a guy in a town and all the attractive young women are heading over the hill to the next hill on this bicycle thing, that's a big problem. And so the press at the time created this thing called bicycle face. And the idea of bicycle face... It was part of the moral lecture that was given to young women in the press at the time, which was basically that young women should not use bicycles because if you go on a bicycle, you have to exert yourself, and if you exert yourself on the bicycle, you're going to end up making an exertion face. But the thing was, if you did that too much, your face would freeze into bicycle face.

David Senra: They literally thought it would stay that way permanently.

Marc Andreessen: It would stay that way permanently, and then you would never find a husband. Right? And so yeah, that was that moral panic. Yeah, and so these things just rip through every... I mean, well, it's incredible. Music is always a great one, because it's like... I don't know, it's over now, but in the '90s and 2000s, there was all this moral panic around hip-hop.

David Senra: Dude, Jimmy Iovine, who is your neighbor, he was in here two weeks ago.

Marc Andreessen: Yeah Yeah.

David Senra: And he had to deal with... They called him a chemical gas or mustard gas. They compared him to literally, what he's doing is the same as genocide because he's funding hip hop music, and white kids are starting to listen to hip hop music.

Marc Andreessen: Yes. Yes, that's right. Hip hop music in the late '80s, early '90s. That's right.

David Senra: In front of... Like, congressional hearings on this.

Marc Andreessen: That's right.

David Senra: The media behind him.

Marc Andreessen: That's right.

David Senra: He was pushed out of a conglomerate.

Marc Andreessen: Yes.

David Senra: This wasn't a joke.

Marc Andreessen: Yes. That's right. And it's actually funny because we... I'm not in the music business, but hip-hop has become so normalized that today it would just never even occur to you. In fact, hip hop was kind of a cultural phenomenon. It's even kind of fading today. But yeah, no, that was super intense at the time, and then rock and roll, that was super intense in the '50s and '60s. And then the amazing thing is that-

David Senra: Remember Elvis Presley? They wouldn't shoot him because he would shake his hips, so they're like, "No, it's waist-up on TV from now on."

Marc Andreessen: Yeah. That's right. Yes, that's right. But here's the one that I love, jazz. They said all the same things about jazz in the 1920s and 1930s. It was jazz music corrupting the... And it was the exact same thing. It's because kids are going to get together, and they're going to dance to jazz, and then who knows what happens. And then it was like there was a jazz musician that's smoking pot, and that means all the kids are going to start. So it's the same story over and over and over and over again. And I'll just say, by the way, in fairness, it's not that society doesn't change. Many of the technologies that we just described did cause society to change. Things are different pre and post the bicycle. They're different pre and post the car. They're different pre and post the creation of modern culture, rock and roll, or whatever. But again, this idea of the moral panic, this idea of just outright panic, end of the world, is just this repeated over and over again thing. And then what's happened is, this is the obvious way to sell newspapers, right? This is the meta story of the press, which is just like, "Whatever's happening is horrible and awful, and it's going to kill everything. Be sure to buy our newspaper tomorrow."

David Senra: Deel is the best company in the world at building infrastructure for global hiring. Deel will help your business hire, pay, and manage any worker anywhere in the world. Deel is one platform for payroll, HR, benefits, and device management across 150 countries. Deel gets you everything you need to run a high-performing global workforce on a single AI-native platform. From the first offer to final off-boarding, Deel handles the complexity so you can stay focused on your business. The best founders and operators in the world have one thing in common. They control as much of their business as possible. The founders of Deel do exactly this. When you use Deel, you aren't using a third-party payroll processor or a messy network of in-country providers. Deel built and owns their own rails. That means faster speed, better service, and total accountability. In fact, Marc Andreessen's firm, a16z, has been investing in Deel for more than half a decade. Deel has built AI teammates that take action. Most HR AI stops at chat. Deel puts AI inside the workflows themselves, so it can run real work across hiring, payroll, mobility, IT support, and reporting. Grounded in compliance-vetted knowledge, Deel AI takes action to help teams move faster without adding headcount. Deel is trusted by over 40,000 businesses. Learn how they can help your business today by going to deel.com. That is D-E-E-L dot com. I want to go back to Jim Clark real quick.

Marc Andreessen: Mm-hmm.

David Senra: Is there anything that you learned... Because Jim Clark was, what, probably 20 years older than you?

Marc Andreessen: Yes, about that probably.

David Senra: So, is there anything that you learned working... What a f***ing education you had to be able to work with that guy when you were in your early 20s.

Marc Andreessen: Yeah. No, that's right.

David Senra: So is there anything that you learned by working with him back then that you still use today?

Marc Andreessen: I mean, yeah, a lot. It's easy to say it was very formative for me, so a lot of it. But yeah, I mean, you mentioned that sort of quote earlier about the world is a malleable place. Jim was like the ultra version of that. And so yeah, he would just... Yeah, when he had an idea... And he was right. His ideas were correct almost all the time. And he would just pound the world into adopting them, into believing them. The idea of being like a complete force of nature.

David Senra: One thing that was malleable was himself. He has this great quote in that book where he calls himself a "self-described loser" at 38 years old.

Marc Andreessen: Yeah.

David Senra: I mean, the guy had like two PhDs, he was a professor, but I think he'd been in his second or third divorce, and he just snapped one day, and he's just like, "I had woke up one day with the undeniable urge to achieve something." And that's when he goes from academic to founder and just rips off company after company for like a few decades.

Marc Andreessen: Yeah. Yeah.

David Senra: So it's like, oh, he realized that he's malleable too. He just reinvented himself over and over and over again.

Marc Andreessen: Yeah. And of course, he does that not just by starting a company, but inventing interactive computer graphics.

David Senra: Yeah.

Marc Andreessen: Right? Like completely changing the field.

David Senra: Yeah.

Marc Andreessen: Indirectly, like completely changing Hollywood.

David Senra: But is there anything about recruiting or managing or any other way that he ran his company?

Marc Andreessen: No, so my two mentors at that time actually were, in some ways, polar... They always got along, but they were kind of polar opposites. They were both Jims, so Jim Clark and Jim Barksdale. So the Jim Clark side of my personality is like the will to power, "I'm just going to bludgeon the world into doing what I want." And then the idea of just like trying to be a fountain of creativity. There are many new ideas out there, and you just need to go find them. And then I would say also... How to put this, like a sense of professional dissatisfaction, like, "Okay, whatever..." Look, this is the other part of the story. A lot of founders would have had a success selling graphics, and that would have been it. They would have spent the next whatever... Whether they were totally happy with how it turned out or not, they would have spent 30 years just coasting on that, right? And having a great time, taking credit for it, and the whole thing.

David Senra: Mm-hmm.

Marc Andreessen: But Jim was always, at least in that part of his life, dissatisfied, in the productive, positive sense of like, "Okay, no, there's something better, there's something bigger, there's something new that we should do." So there's that side of it. And then Jim Barksdale was the other, who I just literally was with yesterday in Jackson, Mississippi. Jim Barksdale's on the other side, which was... Jim Barksdale is the manager of managers. So Clark is like the ultimate example of that bourgeois capitalist thing I mentioned, so the Henry Ford, Elon Musk type, and then Jim Barksdale's the ultimate example of the super manager. And Jim had run big parts of IBM, AT&T, and Federal Express, and came in to run Netscape. What was interesting was that's kind of where I got a lot of this from, and a lot of my skills from. I got trained by both of those guys, and then kind of both of those guys at the same time, and then was able to very clearly observe what is just the difference between those mentalities. But then the other is, of course, how those concepts converge, right? Because just the fountain of creativity, you can't build anything big just with that. Just the management, you don't do new things.

David Senra: Who's a great example of that from history? So would it be like Nikola Tesla? Fountain of creativity...

Marc Andreessen: Oh, that's right. Yeah, so...

David Senra: He needed like a George Westinghouse to commercialize his ideas.

Marc Andreessen: Well, it's a Tesla versus Edison.

David Senra: Okay.

Marc Andreessen: Yeah, so Tesla versus Edison. So I'm an Edison guy. I mean, that's the thing. So Elon's a Tesla guy, obviously. But Elon, of course, himself has now become the really outstanding... I mean, he's obviously become an outstanding manager in his own way. In fact, to the point where I think he's actually inventing an entirely new school of management, which we could talk about.

David Senra: Let's go there next.

Marc Andreessen: Yeah.

David Senra: Okay.

Marc Andreessen: He's maybe the greatest manager of our era, despite the fact that nobody thinks of him that way. So I actually think Elon's more like Edison than he is like Tesla. And there was a big war, and it was kind of this thing because everything kind of turns into these little morality plays. And so kind of the basic story of Tesla and Edison was Tesla had all these ideas but couldn't commercialize them, couldn't turn them into companies ultimately, couldn't figure out how to make money on them, couldn't build big companies kind of based on them. And then Edison basically, at least the way the legend goes, he was more of this grinder. He was less incandescently brilliant, and he was more of a grinder, and he's just like, "We're just gonna try a thousand things." When they invented the filament for the light bulb, they just tried like a thousand different combinations of things to get to the filament, and sort of this brute-force approach. But then he built General Electric, right? He built the national electric grid and built these giant companies.

David Senra: Funded by...

Marc Andreessen: Funded by J.P. Morgan as a venture capitalist in his spare time.

David Senra: There you go.

Marc Andreessen: Yes, exactly, 100%. And then Edison also invented the movie projector and then literally spent years trying to enforce his patents, right?

David Senra: And the phonograph.

Marc Andreessen: And the phonograph.

David Senra: Which you tell the story, and I knew because I read the book too.

Marc Andreessen: Yeah. Yeah.

David Senra: We should tell people what he thought the phonograph was going to be used for.

Marc Andreessen: So this is a bit of a digression, but it gets to the personality type. So, one of the things that people look for is just like, "Oh, what are the consequences of a new technology going to be? Oh, let's go ask the people who invent them, because obviously, they know." And so this is what happens when, for example, the pioneers of AI get interviewed in the press. It's like, "Well, tell us the future of AI." The one I'll pick on is Geoffrey Hinton, who's an actual self-declared socialist. He's an actual capital socialist, and people ask him, "What's the future of AI?" And of course, he says, "It's going to be rampant unemployment, and we'll need to give UBI to everybody." It's like, what a coincidence, the answer from a socialist is communism.

David Senra: Yeah.

Marc Andreessen: Like, what an amazing coincidence. But people think, because he's one of the inventors of AI, that he must be the guy who knows.

David Senra: Yeah.

Marc Andreessen: And so, the story I always tell is the Edison story. Thomas Edison was a very proper WASP. He was a WASPy personality type of that era.

David Senra: Yeah.

Marc Andreessen: Extremely proper gentleman, always impeccably dressed, kind of very ethical, upstanding kind of citizen of that time, and very religiously devout. And so, for him, it was just obvious that the application of the record player was that everybody would buy a record player, and then everybody would buy a library of discs that would be the great sermons of religious sermons from all the great preachers of the time.

David Senra: Yeah.

Marc Andreessen: And then you'd get home at night after a long day at work, and you'd turn on the record player, and you would listen to a sermon, with your adoring wife and kids gathered around you.

David Senra: Yeah.

Marc Andreessen: And of course, the record player drops, and immediately, of course, it's music. It's just, like, obviously music. And it's ragtime, and swing, then it's jazz. And Edison's just completely horrified.

David Senra: He didn't know that if you put the phonograph in the window, and you play good music, then you have all these girls on bicycles coming over the...

Marc Andreessen: With bicycle fists. Exactly, exactly. And so, this is what I always tell. This is always my thing. It's like, if Edison didn't know what the phonograph was going to get used for, the idea that, I don't know, whatever, Joe AI entrepreneur is going to be able to forecast the economic implications...

David Senra: Yeah.

Marc Andreessen: You're like, "No. No. That's not going to happen." And in fact, the people who invent the technology are often the least qualified people to understand the long-term implications, because they're too buried in the specifics of the here and now. And then, all these other questions, you know, these are all big cultural, social, economic questions. And by the way, I don't know if there's anybody that can predict big cultural, or economic or social trends, but it's certainly not somebody who's been in the lab for 20 years, including myself.

David Senra: So, how this started, you think you greatly benefited from the two Jims, essentially, being polar opposites, and showing you...

Marc Andreessen: Yeah, basically. But also working very closely together.

David Senra: Did they get along?

Marc Andreessen: I don't know if I've told this story publicly, so I should tell this story. So, they got along great and became very good friends. They both did great, and they're both very responsible for certainly everything that Netscape did, and everything that I've done. But it's different disciplines, different worldviews. So, there's an oil-and-water kind of aspect to that. And so, Clark ran the company for the first nine months, which, at the time, this was Internet time, it felt like much longer, but it was like this highly compressed nine-month period. And it was like, we were doing all these new things. We were doing all these new things. The company was just doing a hundred new things. It was amazing. But nothing was being systematized, right? By default, it was not going to turn into a large company without the management part. And so, Barksdale comes in, and he basically is like, "Wow, this inventiveness is great, but we need to actually start to have systems, and schedules and processes, and actually, run this thing like a business." And as founders do, Clark originally found that a little bit frustrating because it's like, whatever is the latest idea is not the thing that we're just going to turn the entire company to pursue. And this is when Clark was still coming to Jim's Barksdale staff meetings. And so, Clark got up... He had a negative reaction to Barksdale, saying, "No, we're not going to do this new thing. We're going to keep doing the thing that's already working." You know, it's one of those moments. And Barksdale's like, "Can I talk to you outside?" And so they went out back. And I heard the story from both of them later. And Clark's like, "Look, this is the whole reason we're here is because we do these new things. And if we don't do these new things, we're going to destroy the company." And Barksdale looks right at him and says, "Jim, I hear you. This is as serious as dick cancer."

David Senra: What?

Marc Andreessen: In the deep Mississippi drawl, right? And Clark stares him right in the face, and bursts out laughing. And they got along great ever since. They loved each other ever since. It was first up basically saying, "Look, we're not going to make these decisions in a state of kind of superheated passion."

David Senra: Yeah.

Marc Andreessen: "Like, we're not going to do that. We need to have the full version of this conversation, but we're going to have it in kind of this longer and maybe more dispassionate way."

David Senra: Yeah.

Marc Andreessen: But it was to puncture the stress of the moment. And so, I will say I have used that one a few times. Yes.

David Senra: But I could see Clark...

Marc Andreessen: And Clark thought it was hysterical. I mean, nobody had ever talked to him that way before, so.

David Senra: But I could see Clark like, "Oh, no, here we go. This is a replay of what happened at Silicon Graphics, though."

Marc Andreessen: I think he was, probably, afraid of that to a certain extent. But yeah, yeah. And then I would say, "Yeah." I don't want to say anything negative about the SGI guy, but yeah. I mean, like I said, Clarke was just like... Barksdale was the manager of managers. He was so advanced on this. That story notwithstanding, Barksdale never took the position of like, "No, it's time for the new ideas to stop." But it was always like, "Okay, we need to thread the new ideas into a business," which is kind of the hybrid of the two.

David Senra: So, I just had this thought while sitting here listening to you speak. Is there something about your partnership with Ben, where he's more Barksdale, and you're more Clark?

Marc Andreessen: Yeah. Yeah. Yeah. Although we do mix it up a little bit more, because he does have his own edge. But yeah, there is some of that. Yeah. So, for example, he runs the firm. And then, yeah, I tend to come up with new... He comes up with lots of new ideas, but I do tend to come up with new ideas, and then, we do have this kind of discussion frequently.

David Senra: So, if I was to follow you around without you knowing with a camera, what would your day look like then?

Marc Andreessen: Yeah.

David Senra: Are you just a fountain of ideas? Are you this uncontrolled energy like Jim Clark back in the day?

Marc Andreessen: But I've got both. This is the thing, because they both trained me, I've got both parts of it.

David Senra: Okay. So, you're not as uncontrollable or unmanageable as Clark?

Marc Andreessen: Yeah. I believe Ben would tell you... Oh, I mean, look, Ben's been working with me now for 30 years, and so I think if this was a real issue. I think their partnership would not have lasted. But I think he would say that I have a pretty strong internal edit function.

David Senra: I want to see unedited.

Marc Andreessen: Well, unedited is really fun. Unedited is very enjoyable. It is very disruptive. And so yeah, it has to be calibrated.

David Senra: When do you show the unedited side?

Marc Andreessen: I don't tend to do it in the spur of the moment... Yeah, this is the thing, and Elon threads this incredibly well, just incredibly well, as does Zuckerberg. It's like, is this thing, and again, this goes back to the Edison-Tesla thing, that when you're responsible for an organization, when you're responsible for a team of people that's more than five or 10, if you're going to have an organization that's a hundred or a thousand or 10,000 or a 100,000 people, you can't change the plan every day. You just can't. You'll just burn everybody out, you'll destroy everybody, there'll just be mass confusion, and people will quit. You can't do that. There has to be some calibrated middle-ground. There are a handful of examples of great business successes where it's one, or two, or three people, right? And so maybe it's like Bitcoin and Minecraft and WhatsApp and Instagram, and then, I start running out of examples. But with AI, there will probably be more. There will probably be more single-person companies from here on out.

David Senra: Yeah.

Marc Andreessen: Or, by the way, an artist, a novelist. Let me say, there's a difference between a novelist and a movie maker. A novelist, it's like, you can put whatever the f*** you want in your novel. But if you're a director of a movie, you can't change the entire plot on Tuesday while you're shooting the movie, or there's three hundred people who are relying on you to complete a movie.

David Senra: Right.

Marc Andreessen: So anyway, the point being is in tech, if you're going to have an organization, or by the way, in anything, in any field of activity, if you're going to have an organization, you do need to have some calibration, titration process. Change does need to happen, but it needs to happen in a measured way. And so, you can't just blow it up every day. And so, yeah. So, either what you need in that case to get kind of the holy grail of the large-scale organization that's still innovating, either you need two people involved who are able to balance each other. And by the way, you could say this is like Steve Jobs, and Tim Cook would be a canonical example.

David Senra: Yeah.

Marc Andreessen: Or by the way, early on, Zuckerberg and Sheryl Sandberg, or early on, Bill Gates and Steve Ballmer. So, you can have that kind of configuration. Or every once in a while, you can get that in a single person, right? Which is very rare. But Jensen Huang would be a single-person example of that. So, every now and then, you get that. And so, I would say Ben and I have a version of the yin-and-yang kind of aspect to it. But like I said, he's very creative on his own, and I have this, because I have the Barksdale training. I have this additional level of sort of, most of the time, sort of self-governance. Like I get it. I'm not... But so my big thing is just like, look, if I'm going to walk in and I'm going to throw a fit and I'm going to be like, "We have to change everything tomorrow," and Ben's going to be like, "F*** you, this f***** sucks." That leads nowhere good, right? So that can't be the thing. And so, yeah, I do do a lot of self-editing.

David Senra: Yeah. You just said something, I think you said you believe Elon is inventing a new way to manage.

Marc Andreessen: I think he may have figured out the best way to reconcile the two, the fountain of ideas with the systematic builder. I think he might have figured out a fun... I don't know if it's a new way to do it, but I think he might have cracked the code on how to do that for the next hundred years or something.

David Senra: So, break down what you've observed, with the way that Elon's managing.

Marc Andreessen: Yeah. So I'll just start by saying, look, Elon's method has been described by people before. And I should say, I work with him, but from the outside. So, I've not worked in one of his companies. So I have one layer of indirection, but I work with him quite a bit now, and I study him very, very carefully. It's this extreme focus on substance. It's this extreme focus on getting to the truth. So, one of the things you notice in any organization with multiple layers is that, basically, there's compounding lies. And I got this lesson early, because I worked for IBM at the point of their kind of maximum size and importance in the world.

David Senra: Can you explain? I don't think people understand just how big, and powerful, and almost monopolistic IBM was.

Marc Andreessen: Yeah. Yeah. So I worked for IBM at the very height of their power, right before they fell. It was my first job when I was in college. And they were in the mid-'80s, they were 80% of the market capitalization of the entire tech industry, right?

David Senra: There's nothing even close to that today.

Marc Andreessen: There's nothing even close, right? So this is like Google times 10 or something. It's just Apple times 10. It's a level of scale and importance that just nobody had. And by the way, the TV show actually that does a great job of this is Halt and Catch Fire, in the first season, has this point where these guys are basically inventing the PC effectively, and it's a point where IBM shows up.

David Senra: Mm-hmm.

Marc Andreessen: And it gives you a sense of... It's like the CAA story you told earlier. It's like the phalanx. It's like 20 people in blue suits who are just here to completely crush you. It was just this overpowering kind of thing. And they invented all kinds of stuff, and the industry wouldn't exist today without them, and they were an incredible company for a very long time. And the whole thing, and by the way, run by their founder for 30 years, run by the founder's son for 30 years, this incredible company. But then, they're not that anymore, but they're still a big and important company today, whatever, 1940, so 80 years later. It's like how many companies survive in tech for 80 years? My favorite IBM story is Thomas Watson Sr. had been convicted of antitrust crimes before he started IBM.

David Senra: Is this the cash register?

Marc Andreessen: The cash register.

David Senra: Yeah.

Marc Andreessen: And so, he had previously run a company called NCR, National Cash Register. And he had been convicted by the federal government of monopolizing the cash register business before he even started IBM. And then at IBM, he monopolized the mainframe business, and then they convicted him again. He's a double dipper. He got very used to being in antitrust court. So he was incredible. By the way, there's Kevin Maney, old-school tech reporter, who wrote a book, a biography of Thomas Watson Sr., in which you...

David Senra: It's called "The Machine and the Man" or "The Man and the Machine," right?

Marc Andreessen: I'm not sure if it's that one, but it's one of those.

David Senra: Yeah.

Marc Andreessen: I think it might be that one, yeah. And he actually went back, and we're talking about the 1940s, 1950s, 1960s. And he went back, and he got the... At that time, they had a secretary transcribing, in real time, all of the executive staff meetings every Monday morning. And he went back, and he actually got the archives of the transcripts of the executive staff meetings, and Thomas Watson is just cursing everybody out, and just like a complete tyrannical psychopath, just screaming at people. And it's all in the records. And so, how much of this stuff ever changes? It's like, I don't know, whatever Elon gets accused of or whatever Steve Jobs, it's like, oh, no, that guy was...

David Senra: Yeah.

Marc Andreessen: Whatever it is, it's a pale version of what that guy was doing. But anyway, the point being is IBM... So by the time I got involved in IBM, it was 60 years later. Anywhere, yeah, 50 years later after that. And so they were kind of peaking in their power. But what happened was, I remember this because I was there as an intern, and I was trying to figure out whether I should work there after college. And their internet was a mainframe app. And one of the functions was the org chart, and it calculated that there were 12 layers of management between me and the CEO. Which meant the following: It meant that my boss's boss's boss's boss's boss had a boss, boss, boss, boss, boss, before it got to the CEO. And then, really, the story of the thing, really what happened, and I saw this happen, I saw this happen up close. What I saw happen was that each layer of management was lying to the one above it, right? And because each layer wants to look good and wants to, whatever, put a little spin on the ball. And if one layer lies to the next layer above it, maybe that's okay. But when that happens two or three times, the lies compound. If that happens six times, the lies really compound. If that happens 12 times, the CEO has no idea what's happening, like absolutely no clue what's going on in the company, which was the state of play that IBM had. They actually had a term. There was actually a term. They had a whole vocabulary. I mean, this company was like a nation-state at the time. You could live your whole life in Austin, Texas, and never meet anybody who didn't work for IBM. It was just this incredible thing. They had this concept called "The Big Gray Cloud." And it was literally the cloud of men in gray business suits who followed the CEO around, and prevented him from ever talking to anybody who was ever actually doing the work. And so, when he would come to visit, it was like a state visit. It was like a visit from the king, and it was like the king and the traveling court.

David Senra: Yeah. Yeah.

Marc Andreessen: And so, it was a completely impervious bubble to get information through. But I tell that story because that's the polar opposite of the Elon approach, right? And by the way, being the CEO of IBM in 1989 was a great way to live, right? Because it's just like, "Wow, everybody's bringing me good news all the time." I wake up in the morning, and everything is great.

David Senra: Mm-hmm.

Marc Andreessen: And I'm famous, and I am rich, and I am successful, and I've got a chauffeur, and I've got a jet, and I've got these 80 guys in gray suits who are taking care of everything for me. And I don't have to ever talk to engineers, and this is great until it's like the turkey on Thanksgiving, until things change and there's a problem, and then you have no idea what to do about it, which is what happened to them. The Elon approach is the polar-opposite of that. And the polar-opposite approach is literally like, I'm only going to talk to engineers, right? And so, when there's an issue, I am going to go straight to the source of truth, and the source of truth is the engineer who actually knows what's going on. And so Elon, I've seen him do this, so he literally does this. When there's an issue in one of his companies, he goes to whatever is the engineer who's working on that problem, and he sits down with the engineer, and they solve that problem. And I can just tell you, the number of CEOs in tech, even the great ones who do that, I mean, almost nobody ever does that. Why does nobody ever do that? Well, first of all, it's just like a giant pain in the ass, because your life consists of having to actually solve all these problems. The whole point of being big, and powerful, and successful is you pay people to do that, and now you're doing it. And you're in there at two in the morning doing it, right? It just sucks, right? And so, most people won't do it. And then the other is, it means the CEO of the company has to have the skill set to be able to do that. So the CEO has to not just be a great CEO, they also have to be a great technical technologist, and not just that, they have memories of having been a programmer at one point or whatever, a chip designer. But where they can actually sit down with the chip designer, right on a Thursday night at 2:00 AM in Austin, and they can actually figure out what's wrong with the chip. And Elon has that ability, and he's like encyclopedic on every area of technology, and is able to go hands-on with rocket designers, and AI designers, and everything in between. And almost no CEO has that. But that's literally what he does. And then the way that he thinks about it, I think, is basically, he runs whatever, six companies at once or something, and it's like, basically, at any given week, he thinks about everything as a basic production line, sort of production process. He's actually like an old-school industrialist. So everything's like a production process. And then, any given week, in any production process, there's always a bottleneck. So there's always the thing that is slowing down the process the most. And that's always one thing. So what he does for each of his companies is he identifies, he charts, he literally maps out the production process, and that's like, he literally has these monitors where he has the whole thing laid out. And then, he basically says, "Okay, this is the issue that's holding up production this week." And that's the thing that he goes to work with the engineer on, is he goes to fix that bottleneck. And he does that every week for every company, right? And so, I think this is why Tesla is smoking, has been so much dramatically outperforming the rest of the auto industry, is because he's fixing the critical production bottleneck at Tesla 52 times a year, himself.

David Senra: Yeah.

Marc Andreessen: I can tell you what the CEO of the legacy automakers are doing. They're not doing that. That is not what's happening, right? And so, in contrast, a normal company, it might take six months to solve these problems, and Elon's fixing it right now, tomorrow. Like, let's go fix it right now. And so, he just runs this loop over and over again. He's absolutely indefatigable. He famously, for a while, he had sold all of his houses, and he was literally couch surfing as one of the most successful people on the planet.

David Senra: Yeah.

Marc Andreessen: And so they have a vacation house, and I offered him, I said, "If you want to take a week and use the vacation house and whatever, take the kids, feel free." And he'd sent back five minutes later, it's like, whatever, 11 o'clock at night, the forward response, "I don't take vacations." Right? Which, again, is like, there's no CEO like this.

David Senra: Yeah.

Marc Andreessen: The whole point of being a CEO is you get to go jet around. And so anyway, so he's doing that, and then he turns this into a routine. And so, he does that a day a week at each of his companies, and he'll basically do it all day. He'll do a 12-hour to 14-hour stretch where he'll do design reviews with... But the way that he does it, he does it with five minutes per engineer, right? And so he does 60 divided by five... It's been way too long in this podcast. How much is that? 12? 12. He can do 12 design reviews an hour.

David Senra: Yeah. Yeah.

Marc Andreessen: And then he does it for 10 hours a day. So, Elon will do 120 design reviews in the course of a day.

David Senra: Are these one-on-one?

Marc Andreessen: I have not actually sat in on these.

David Senra: Okay.

Marc Andreessen: I suspect there are other people around, including people who work for him, and probably, some of the leaders of the companies are involved in different ways.

David Senra: Okay.

Marc Andreessen: But it literally is the thing I know. It's literally a rotating cast. It's the point engineer on each of the important things coming in and presenting for five minutes. And then the question is, if it's going great, that's great. If it's not going, what's the problem? And then how does that problem rank, right? Is that the production bottleneck? And if it is the production bottleneck, then that's the thing that he then fixes. And then that's when he's there from, whatever, eight o'clock till 2:00 AM, working with that engineer to fix that problem. One way to think about this is the velocity in military affairs, it's called maneuver warfare, right? So the speed at which he operates is just, the cycle time is just so much faster than anybody running in a traditional method. It's hard to even compare the different... It's like four hours versus six months. It's just this incredible gap. And then, the other part of it is, somebody that I know once, went to work for SpaceX, and they asked what it was like, and he said, "It's like being dropped into a zone of shocking competence. It's like everybody is ultra-competent." And the reason everybody's ultra-competent is because, number one, if they're not, Elon sniffs it out and fires them. But he knows, because he's talking to the people actually doing the work, so he knows at this point, you know, having done this for, whatever, 25 years, he can sniff this out really quickly now. And then the other is, the best engineers in the world want to work for him because he's the one CEO like this, who's able to work with them as a peer on whatever the technology is. And as an engineer, you're just like, "This is..." Like, what would be better as an engineer than being able to design a rocket engine with Elon Musk as your engineering partner, right? And so, he just has this incredible positive selection where the smartest people in the world want to work for him, and then anybody who can't cut it gets fired. The world sees this as raw aggression, but it's beyond that, right? It's a very systematic way of optimizing these companies to be able to take on these profound challenges, and then being able to actually solve all the problems, and do these things, and at a speed that is just completely unmatched. The challenge of all of this is okay, that all works great, if you've got Elon, right? And so, one of my concepts is I think we need a metric for founders in Silicon Valley called the "MilliElon," right? And so, how many MilliElons are you, right? Are you 10 MilliElons? That would be great.

David Senra: Yeah.

Marc Andreessen: Are you 100 MilliElons? That's 10% of an Elon.

David Senra: Yeah.

Marc Andreessen: That'd be fantastic. You know, 500 MilliElons, I'm going to give you all the money, right? Most people are one MilliElon or 0.1 MilliElon. The question that falls out of this, which is a question that [unintelligible] ask, is, like, okay, you can't clone him. You can't bottle the essence. So, what out of that can be transplanted to normal human beings?

David Senra: And how much of it is predictable, or knowable when he's much younger?

Marc Andreessen: Mm-hmm.

David Senra: Because the famous example of this is Michael Moritz's passing. Made all his money in PayPal with Elon. Obviously, there was contention there. He got kicked out and everything else. But then Elon pitched him Tesla.

Marc Andreessen: Yep.

David Senra: And he passed because he's like, "There's no way that you're ever going to surpass Toyota." And then Moritz, to his credit, was just like, "I drastically underestimated the guy's determination and pain tolerance," I think is the term he used.

Marc Andreessen: Yeah. Well, I wasn't there for that, so I don't know about that. I will say the idea of having been a software entrepreneur, and building a car company... Okay, when Tesla started building, there had been no new successful car companies in the United States for 100 years.

David Senra: For 100 years, right? Yeah. It was like 2000 of them founded from 1900 to 1910, and three that survived.

Marc Andreessen: That's right. Yes. Yes. That's right. And the previous real attempt to start a car company in the US before Tesla in the preceding decades was?

David Senra: Tucker or something?

Marc Andreessen: Tucker Automotive.

David Senra: Yeah, yeah, Tucker.

Marc Andreessen: Which was such a disaster that they made a movie called "Tucker," which is about what the disaster it was. And so, obviously, you don't do that, obviously, this is insane, and for a software guy to do this is insane. Oh, by the way, this is only one of the things he's doing. He also has the rocket company.

David Senra: Yeah.

Marc Andreessen: Which is also insane, right? And so, yeah And by the way, I didn't see it. I'm a software guy, and I was like, "I don't know, whatever. I guess he's going to go do cars. I don't know anything about cars." So, it's not like I saw it, but I'm just saying the level of incredulity that he was greeted with at the time was, I think, almost uniform. And there's that famous photo. The most famous Elon photo, I think, the most powerful one is the one where he's, it's young Elon, probably 2005 or whatever, and he's in the...

David Senra: He's in the shorts and a polo, and he's crouched down, and there's nothing but the explosion remains of the third rocket, the second or third rocket.

Marc Andreessen: Yeah. yes.

David Senra: The one he had been funding personally, like...

Marc Andreessen: Yes.

David Senra: Did you ever read Eric Berger's book, "Liftoff?"

Marc Andreessen: No, I didn't.

David Senra: Oh, you got to read it.

Marc Andreessen: Is it?

David Senra: I'm surprised you haven't. I like these company histories that focus on the first six years.

Marc Andreessen: Yep.

David Senra: And it just stops.

Marc Andreessen: Yep.

David Senra: It's a first six years history of SpaceX.

Marc Andreessen: Yep.

David Senra: And it's just, nothing good in the book.

Marc Andreessen: Yep.

David Senra: It's just reading one failure after another, after another, and one catastrophe after another, after another. It's a good read.

Marc Andreessen: Yeah. When my kid was five, he loved rockets, and so his favorite rocket video was the compilation of all the SpaceX rocket explosions.

David Senra: Geez, well, Elon talks about this, that before his friends, after he sold them to... I think he had 180, I think the story tells 180 million after taxes, and he's like, "I'm going to do this rocket company." One of his, I think Adeo Ressi, or I forgot the friend, sat him down, and they made him watch all the rocket... There was a compilation, this is probably pre-YouTube, of just rockets blowing up over and over again. Like, "No, you're literally going to light your fortune on fire. It's going to explode in the sky."

Marc Andreessen: Yep, exactly. Exactly. So, I mean, obviously it's working, right? So, his method, obviously, is working, and it's obviously working far better than... I mean, it's certainly working far better than anybody else's method in cars and certainly working better than anybody else's method in rockets. And then in a bunch of other areas also. So, it's clearly working, and so it's like, "Okay." And then he just draws, because of just who he is and what he's doing, and how he does it, he just draws so much heat, there's just so much... The environment is just full of criticism and attacks, just nonstop. And we all kind of get sucked into these narratives. But I think the key thing, for me, it's just like, okay, there is a method there that he has been working on and refining for coming on 30 years that has worked better than anybody's method. Like I said, I don't know how many people can do it. And maybe there's just a fundamental limitation, which is you can do it if you're Elon, and you can't do it if you're somebody else. Or maybe, you need to be above 30 MilliElons, but not below or something like that, right? Maybe there's some threshold where you break through on this. But it is clearly the best method. Like, it clearly is generating the best results. And then, again, conceptually, I like it, because again, it's this bridging of the founder mentality with the manager mentality, because he's not just doing, these are not just one-offs. He's scaling. Everything is scaling. What is it? Starlink just hit, what was the number? Starlink just hit 10... Was it 10 million subscribers?

David Senra: I'm one of them.

Marc Andreessen: Yeah, exactly, right. You probably have read about Iridium and Teledesic.

David Senra: No.

Marc Andreessen: Oh, okay, okay. So, Elon's not the first guy who said, "We're going to do satellite-based internet access."

David Senra: Mm-hmm.

Marc Andreessen: There was Bill Gates, Craig McCaw. So, when Microsoft went on top of the world, and Craig McCaw, basically, built cellular telephony in the US, built what's now AT&T Mobile. Those guys teamed up in the early '90s and did this thing called Teledesic, where they put up satellite-based voice, and then it was going to be internet access. Complete catastrophe, total bankruptcy, complete disaster. And then Motorola, which used to make all the cell phones in the US, had another one system that's actually still up called Iridium. And again, it's just this classic business school case study of just complete disaster capital destruction.

David Senra: Mm-hmm.

Marc Andreessen: And so Elon's like, "I know. I'm going to do number three of those with Starlink as a side project at the rocket ship company."

David Senra: Yeah.

Marc Andreessen: Right? And, you know, in retrospect, it's total genius because he's like, "We're going to be putting up... If the rockets are reusable, we're going to be launching them all the time." And then the question becomes, "What's going to go in the rockets?" And he's like, "I could wait for the customers to come to me with more stuff to put in the rockets, or I could just put up my own satellites." What would be the satellite to put up? Oh, it would be consumer-grade, consumer-priced internet access. And it's just like, "Okay, anybody who knew anything about the history of satellites, knew that that's the new craziest idea in the world. And of course, it's this giant success. It's like the side project. There's clearly a method. It clearly incorporates invention. It clearly incorporates scale. It does a brilliant job at both of those. It's clearly in part, Henry Ford, whatever, Alexander the Great method, clearly. But there's also real scale and heft to it. SpaceX now is building, you know, they got their own city, down in Texas, right? And so it's a formula that captures both sides of it. And it may be the least studied and understood thing I know of in the world right now.

David Senra: It's incredible. Mark, we're running out of time. When I started the show, you were at the top of my list for one of the guests I want to talk to. Thank you so much for doing this. I hope you come back in a few months, because there's a million other things we need to talk about.

Marc Andreessen: Good. Awesome. Fantastic. Thank you.

David Senra: Thanks. I hope you enjoyed this episode. Please remember to subscribe wherever you're listening and leave a review. And make sure you listen to my other podcast, Founders. For almost a decade, I've obsessively read over 400 biographies of history's greatest entrepreneurs, searching for ideas that you can use in your work. Most of the guests you hear on this show, first found me through Founders.

‍