Acquired LIVE from Chase Center (with Daniel Ek, Emily Chang, Jensen Huang and Mark Zuckerberg)
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Hey, so um I know this isn't like the best time to bring this up, but did you bring the thun drive with that? Who got the truth? Mp three for the sound crew?

no. Why would I bring a some? I did email that Price like three weeks ago though.

Well, there's six thousand people out there waiting to hear IT.

Look, the team is really great. I'm sure y'll think of something.

Let me down, say you story, no way. Who got? The true everybody y's talking nobody's little thing these days feel lost things everybody's fighting nobodies win in take me home because I don't know was going in the world.

So for this, go please help me. Welcome to the stage that has been acquired apart test bit tube a David rose. And now.

Hi two year. Let me down, say you say another story on the way, who two 别 不敢 的 车。 Who got to go, my child? 哇。

We didn't need the thun drive.

We didn't need the thun drive. Welcome to this episode of acquired the podcast about welcome to a quiet live with the chase center.

wow.

This is A. Well, this is, I believe, thank you for gaming. We have a very, very special guest and surprise to welcome us all here tonight. The CEO of japan Morgan chase Jamie dinan .

low required listeners.

Welcome to the chase center and to required live. I'm Jamie diamond, chairman and co. Jay Morgan chase. I'm happy to kick off the shelter night and welcome all of you to one of my favorite arenas.

It's been a great partnership all year between japan Morgan payments and acquired storytime and education about some of the greatest companies in the world for many of them. Just like many view in the crowd, we're thrilled to call your friends and partners of the firm. Sorry, I couldn't be there in person tonight. I hope everyone enjoys the show. Been in David, over to you.

Thanks, Jamie. Well.

a special shout out and .

a huge thank you to J P. Morgan and the hole payments team, especially dustin edc, the cm o of jp Morgan payments long time listener has been like really the driving force behind this whole thing and his truly world class marketing team, hanna, nick, Jenny, amy and carey, day and nigh for the first time, really now understand what IT is like to have a glimpse of what a sort of real built out team would look like. And not just two guys in their basement. So thank you for an amazing partnership then.

And I did not put this on ourselves today. So what do we do in the night?

Well, as you all know, mark.

soccer burgers in the house.

So tonight we'll actually have three acts, not one mark, be our third act after inter mission, but we've thought got a lot of great segments know in our first two acts here, some more fun surprises Sparkled in in the middle. So David, what is the format like? Is this an acquired episode?

Well, amazingly, shockingly, we we tell you all all the time that we make when we make an episode. We set our houses in our studios. We record all day for nine hours. We turned that nine hours into three or four or five hours that you all here um and we thought, yeah that's probably not gonna play here, but you keep asking as you keep emAiling us so we want to put this request, this question to bed once for all here tonight. Here's what you are missing in the full nine hours of an acquired recording session.

I am trying to do a Better job getting air flow in here while recording because I think I get dumber at the end of episodes or at least I get like I get exhausted. I think part of its the lack of oxygen.

It's really hot in here, and we've been going on for five and half hours.

Let me finish this thing and then .

take a Better breath though.

Police more champagne.

So about that.

Hey, blue Angels.

great. Only in nine minutes and forty seconds of bull shooting before we, you actually started.

It's very good for us. record.

Is this two in the weeds? Let me take a stop at making IT for a Lucy goosey.

I think I can simplify all this.

We got to advance the story more. The pacings too slow. Oh, this doesn't make any sense. Okay, great.

We can cut all that. Then cut, just cut IT. Let's cut all that.

Got that. Skip, skip IT. Yeah, let's skip IT and keep moving.

Ah, okay, I think one of us has our time wrong. We've been so stop and start. Do you think we should just restart the .

whole thing for thirty five to forty minutes into this episode and nothing has happened?

I think I would actually feel Better and more in the flow because right now.

like what did we cover? What did we not I think .

what your saying is replace all of what we did before .

i'm going to go rerecord, at least the first part.

maybe that whole thing. I don't recall exactly how we started though.

I don't remember the last .

thing you said either. I think i've .

been like interacting.

No, I think it's great. Please keep. I I don't find IT of knowing at all. No, the goal is like make the best stop. I actually .

quite like how this is puzzling in.

You GTA start .

making that .

face face and take .

IT without the ARM.

嗯。

totally.

Don't .

go .

for IT.

Do IT is so hard to keep all the separation? And I like, I feel like .

I like how of am what's going on?

I just try to beep on your end.

So that wasn't of the best episodes.

That is how the sausage is made.

I think that actually is a good way .

to end IT.

So i'm done.

Thank you for indulging us. I was not sure if that would play in an arena.

This is what Stephen has to deal with every month.

Yeah so obviously, not only we're not doing that, we literally can't we fire martial issues. So David, what are we what's tonight?

We thought we were going to take the acquired playbook and we're going to throw out the window and we are going to throw a party instead. IT is a celebration of technology of the stanford scobey area of wu. If it's just go, yeah.

Some of the most important businesses of our time. And most importantly, it's a celebration of you all. We say you all on the show. Usually you're not here. So tonight you Normally .

we study the past, often the far past. Tonight we're going to kind of look at the present. It's a little on acquired, but like once every two and a half years or however often we do a life show, we want to indulge. So yeah, we're going to indulge tonight.

Indeed, we are. So to start, we wanted to spend a couple minutes at the top of the show here in our first act, just giving you all an update on the state of acquired IT has been quite a year for us. You and I have lived a lot of life in one year. We both had kids. The wall street there are also wrote .

about .

us yeah and we've experienced some pretty amazing growth.

Yeah and so we were thinking like David kind of pitch this to me and I would be to stand up and give a keynote unlike the state of the union of acquire this time doesn't feel right but a conversation would be great if we were of the right person of a conversation with and we were like, who is a big acquired listener kind of gets we're all about everyone in the audience can be like, oh yeah that persons one of us and is like, you know, the world expert on podcasting. Fortunately for us in all of you tonight we are heard of welcome all the way from stockroom, the CEO and founder of spotify, Daniel, like.

哇哦， 吓死 我 了。

别扭。

Wow, this is pretty insane guys. I think this probably out to be like the biggest recording of a podcasts in the world.

Echoes studio.

yeah, yeah, you guess, should use this as the studio every time. I think .

you've been after us to do more video for years.

That is.

you are gonna a video for sure.

All right. Well, love that. Love that. And you know, it's really amazing for me to be here and just see you know this and all of you guys success or remember listening to you guys as a fan.

I think starting twenty thousand and see that we're now five years later from a small base going to something like this, it's pretty remarkable to see. And I don't know about you guys, but I thought maybe to commemorate this moment would be pretty fun. I know you don't wanted tell your success, so I thought maybe I could do that for you. So maybe we can have a look at some of the amazing stats and assume s you guys have accomplished well.

thanks. Yeah, I know you pulled some data. We pulled some data. This is the updated version. Appear of the kind of classics acquired shirt that we've been showing, which basically shows from when we started in two and fifteen, the kind of like organic doubling you're over year, over year all the way through today.

And basically, since we don't market the show or we don't do any paid marketing, the only way the show grows is we make an epsom. A friend tells you know, someone tells their friend about IT on on average, every listener tells one other, one other listener. Every year here you should listen to that person sticks. And kind of the whole thing.

Yeah, I mean, it's prety remarkable. And on spotify, a loan you guys have now done over five million hours and it's tripled in the last year. Pretty remarkable, right? Yeah take around the problem.

So so um so we did the math bended. The math is usually does I believe that is over four hundred years of acquired. That was we feel like I was four hundred years making the episodes in the last year, but that was listen to in the .

past year yeah what what is the attended one? The longest one you guys have done.

I think, microsoft volume to our longest .

single episode.

But thank you for pulling this. So the reason the way this came to be as we ask and you're have you know you've access to data that all podcasts ers sort of dream of, what is the most interesting inside you can kind of pull out of IT. And the thing that's the crazy is to me about this chart is that even though here's how many downloads and episode gets isn't like celebrity status, like it's not the crazy st biggest in the world because of the volume of our episodes. We all spend a lot of time together like thank you for lending us your ears for all of those moments because that that's that's what that charges to me is all the time we spent together.

Yeah but what was really cool for me to is just seeing the fandom of the shows of one thing is, is you know obviously seeing the sort of total numbers, but also seeing defendants and you guys are added more than two hundred and fifty thousand followers and that triple last year too. So it's over two and fifty thousand dollars on spotify loan now on the quiet show, which again is pretty a remarkable to see that .

kind of growth. Yes, there's two. I'm like a reform venture capitalist.

I can't help but like playing out things on church. There are two things that are interesting about that chart. One is we've had like ridiculous subscriber growth thon spotify. I think it's just been you guys entering the industry has created a ton of net new audience of people who did not listen to to pod casters before. The second thing is if if you pull the chart back up again, you can see the wall street journal article in may in that insane somebody I know we keep talking about.

if IT. This literally has never happened in the decade of acquired, where a single event caused a kink in the chart. And that we see, you guys see that is crazy.

Well, it's bird a mouth in a new way. But the other part that was really cool to me as I was looking through the data, I kind of expected this to be sort of an english language thing only maybe the us, maybe U K, that kind of thing, but you guys are truly grown worldwide. Um so you know look at some of this stuff like you have mexico growing five times, uh home kong, israel, singapore acquired as global. So it's amazing to see here in safe cisco that we got six thousand people in one place. But i'm pretty sure you guys should take this on the road and will see if can make IT another places.

When you see the whole art of the show denied, I think you'll say.

ah you can take that on the road yeah viv.

you know it's maybe a timing question. You guys should be like the new rockstars to torture around. That would be the the great thing to do. And you know I want to really of we take the moment here and ask you guys how all of this happened.

And by way of context, just to put put put this in perspective, in two and nineteen, you when we got into podcast the world around podcast listening and spotify, there's a few million people listening to this and you mention this. But like our goal was to sort of broaden this whole medium. And today there's over one hundred and fifty million people listening to podcast on spotify. And obviously, your shows a huge success and something that people who kind of attracts people in the medium because it's both pretty broad these days but also very, very deep. Like what do you think contributed to that success?

Well, you guys entering the industry for sure, but I think you hit on IT with like abroad. But like when then and I started this, we thought we used to talk about what our time was is we are venture catholic. What's the time for required that we even thought about IT? There's a business product, but and we like know maybe there's what's the population of students in business schools sound there.

Maybe that's a teen and then we were like, well, I don't know, maybe it's little bigger than that. Like maybe maybe it's you everybody who ever wanted to go to business school like, okay, like what's that cap out of that? Like a million people, maybe a million million felt like R T.

M. And what's happened to us. And i'm current I think you guys probably seen the same thing is that even though we think we're super nerds and we tell these very esoteric stories, they're just great stories and people of all types want to listen to them, right?

And the growth of the medium, like we have this ridiculous tailwind where we got Lucy and picked right in two thousand and fifteen, we stayed with IT. We ve got Better at the craft, but like IT, turns out people are super interested, thanks to all the wireless headphones that exist now. And I know this is weird loral norm that's kind come inflation that it's okay to spend hours and hours and hours with someone in your ear is talking about something that is interesting to them. And I just don't actually think that was a thing in the early twenty ten, right?

So one of the things you're obviously have done this um you know add a video to the format and this is my plug e hopefully getting you guys to finally add videos S A spotify as well. But what do you think is next for the show when IT comes to that? Like what do you see? The big innovation of a quiet will be in the future.

So I think our total dressed well market is at least ten times bigger than IT currently is today with our exact same product. If we just keep doing the work and making the product Better and shipping one episode a month.

And the question is like how much more can we do without killing the golden goose? Like how do you keep the main thing actually, can I turn this back on you? Like you have massively expanded what spotify does since the original vision. How should .

we music on facebook?

How should founders think about like the only reason that you are allowed to exist is because you're really good at this one core thing, but everyone, you should do other things well.

I mean, a bigger starts with your audience, right? And knowing your audience. So, like princess, we launched audio books about a year ago, but sort of untold story about that audio books launches.

What happened in germany is all the record companies started upload audio books to the service, so they started hacking the system for all these other things. And when they ran out of that, they actually started uploading podcast. So podcast turned out to be the easy medium for us to start with, but eventually we add in sort of body of books too. So I think you you know most amazing things tend to start with people kind of suggesting things or maybe even doing things. So be interesting to kind of like figure out what people are doing in and around accord already, and that will probably be your sort of a agency.

I think the other you know video then and I talk a lot, we will talk more about video throughout the evening here. Know we've just always sort of been of the belief of like nobody wants to sit and watch us in our studios as talking heads going jack, jack, jack. And but we've started to ask the question of, like, is there for certain companies we cover is their rich visual tapestry that we could do at the same level that we try and create an audio tapestry.

It's an absolute crime that we did four hours on the entire hundred year history of arms. And IT was just audio like.

but IT was an amazing show though.

right? Thank you. But audio is this like magic saying where i'm to drag my we're going to end up doing more video, but i'm to drag my feet kicking and screaming all the way there because I feel very passionately that the reason that the calibre of person in this room with all the busy things that you have in your life, the reason that you're open to spending all this time with us, is because we don't take your full, undivided attention.

You can run, you can model on, you can drive, you can you know everything that everyone does, what they listen to, acquired. I like I remain unconvinced that we would work as a four hour video product. yeah. I mean.

look, I don't know to be onest. I think this is probably the biggest thing that surprised me is that the world just keeps evolving constantly. So you talk about video, you on spotify, it's been a huge growth thing.

I would have said you as well, people probably mostly why would you want to watch a video? But I think Younger consumers especially, they don't know what the differences. They just want to feel close your presence to the person.

And I mean, we saw W. T. Already with the blueprint, right? It's like, this is fun, what you guys are doing and people have a relationship to you guys too, hence why so many people are showing up here tonight. And I think video is just a way to express that whether or not they're watching the full for hours or rather, they diving in and out over a particular type of segment. Um I I think just giving the consumer the choice um is sort of one of the big things and that's kind of what we're leaning into as well is just allowing the craters and the consumer two more directly interacted more in novel ways.

It's funny. There's your question was what's next for required? We're going to do a Normal episode after this after tonight. That Normal episode probably will focus on a mental park based technology company. And one of the lessons that were already starting to learn, well.

we can take that back.

now. This live is live is just not not holding the current state of things and vision of what you are too tightly. And we wanted you've learned a lot from mark over the years. You all been very close um spot I started on facebook um and here you are. You're the biggest podcasting platform in the world so you didn't hold on to that vision too tight.

So can I try that into a question, please?

I was actually .

gonna wanted to leave you some space before .

we asked that. So great partnership is all about, do you remember? So David and I have one way of growing, which has make a good episode, and hope people tell their friends. Do you remember in the early days of spotify when you figured out, oh, facebook is going to be this unbelievable channel for us?

Yeah I mean, it's it's I think IT starts like so many other things. I think, mark, I would just struck this sort of friendship and we started talking about um the law told the story is if I remember this correctly, I think mark, even pre facebook was trying to do in music start up oh yeah and then he was like, this feels like a ffc t thing I probably yeah exactly and and so I think he's like I think pretty much every great entrepreneur in the valley try to do music start up um and so he was definite passionate about IT and then um his idea obviously was a social music product and now we started talking about IT I in the beginning he started like he wanted mostly spotify to be more social. So well, I don't know .

that that member how you get an reduce the spotify was not like spotify the way that is .

today world yeah well I I got introduced ed to mark through sean Parker um and so sean kind of said to do suck like hey, you're going to meet this entrepreneurship. Sweden, and I remember like muzak at the time, was living in a very small house and we went for a barbecue at his house. This is probably of our two thousand eight or nine likes one of those things. And then we struck a friendship, and we started jamming on various ideas around how to make music more social.

And you were not even live in the U. S.

That I don't think definite in ve. So this sort of secret of spotify was we sort of seated one account at a time to get a bunch of influencers to kind of like IT, and I think Shawn in particular, you kind of use that as a social currency. So everyone came to him to account, try to get all .

the invades the man, the currency of the the spotify invades. Yeah, IT was a big.

big thing for for quite a few years before we launched, where IT was kind of the secret thing if you were in the club, if you weren't. And anyway, he got mark on IT. And I think a mark kind of wrote this status updates like spottier y so good.

And then, you know, everyone like, how do you get this? This was kind of the main thing. When can I get and how can I do IT? And yeah, then we started gaming around like what a social music product want to be. And we had this sort of idea wouldn't be cool sort of like with, you know, I secure at the time where you have this status updates, like wouldn't be cool to be able to check out what your friends we're listening to. And we kind of got to work together, built that products and coincided IT with the spotify us launch.

And this was when news feed was really Young, right? So there was like you'd be thrown through your news feed and I would be give me the status updates of what your friends were listening to .

pipe in directly from spotted exactly right. So you can see all your friends IT actually still exist in on desktops. You can kind of see where your friends are listening to a real time. It's one of our more popular legacy features has been around now for like thirteen years.

He was the right side bar, but I feel like i'm seen IT in a while.

Maybe just is still there, still there.

So but this gets at the point of like social music listening was this core insight that you had. Mark was on board to kind of build IT together and let you use the and he got a lot of IT too, but let you use facebook to distribute IT there. And yet everyone hear who's a spotify customer today when I think spottier Y I think, oh, that's like the easy way to access music podcast and now what do your books but I don't think like, oh, it's a social listening, right? So what point did you kind of like like let go of that precious idea and say, maybe the social like important, but not that important?

Well, I still think of socialist, huge, important. And for instance, we have we have a product now called jam, which allows you to be with your friends and actually altered what you're listening to at the same time and is growing incredibly rapidly right now are all over the world. So it's it's something that, you know, I think very much is a social product.

But while I still think music is very social, I think what we got wrong in the product was this sort of notion that just seeing sort of what all of your friends are listening to may not be the sort of right social product. But if you instead sort of say, like, I want to work together with my friends and I want to have a shared listening, whether we're in the same place or not, that turns out to be a pretty amazing things. So you see people do IT at parties where you can literally join someone dam, and you can sort of all q up songs together.

Instead of taking my phone or your phone, we could all be sort of working together on something. But what we saw during the pyne ic, and that's like where jams sort of started. We started seeing that people. We're using this to state connected that as well by having sort of shared um you know consistent music listening where we are all listening to the same thing at the same time, even though we were sort of apart.

It's the best of linear TV brought to music.

Yeah so I think we're still sort of you definite playing with a social concepts and trying to get that right. But I think facebook kind of moved off of this sort of presence based social aspect for all things. So IT wasn't just music.

actually. People were doing IT for games back then. two. So I was like, you know, created in all their farm middle.

No, we remember that era.

yeah. Was that .

like north of ten percent of facebook s revenue?

What IPO was from was singer, yeah yeah. What I mean, this is all fun history. I'm curious though, you're going to talk to mark later .

the night night for .

doing research live on stage and the way you ve had a relationship, a prety close for fifteen plus years as fellow founders in the trenches, what what have you taken from him that you ve brought in this particular and how you run the company?

Many things. And i've learned so much from him and the rest of the team that made a as well. But I think it's specifically for him. You know he's the probably the best learner i've ever seen.

Um you know you can you can have a conversation with them about a topic I came in I know very much about IT and then the next time you would know more than I would say most experts about the subject uh and it's really remarkable just how tenacious he is uh sort about learning and staying curious about things. So that's definitely been a super inspiring thing for me. And I think that this sort of shines through with how he runs the company too is a very certain of clear idea.

But he also takes a lot of feedback and sort of on that. And you know, it's everything from one of the cool things for me. I've been seeing how he runs meetings. Princess, I kind of like having relatively small meetings with people.

Mark, the average meeting the asis like fifteen to twenty people in the room and how you make, you know, a product review or discussion productive with fifteen and twenty people still get people to be heard like he is. He's very, very good at that stuff. And that's just a few of the things that i've learned, which has held me as a leader.

Well, can I ask maybe a little bit more appointed? You are a kind person, youth, soft spoken person, but you are a fierce .

competitor, OK. So we have do this when we interviewed you for eighteen, twenty four months, years ago in starcom. I'd never have been to swiming before.

I don't think you are either. And we left. We thought, just like, what a lovely country, what lovely people Daniel is like the most generous person we could imagine. You're here tonight. And that guy is a fierce competitor and there is a reason why he has built spotify and .

very strategic. Like I think you you see the chess board, mark, is like that too. Do you feel like your relationship? Do you amplify each other?

Well, I mean, the rule I have with markets, I don't try to go a competition with them because I know i'll end badly for both of us. So as you know, mark like sports. So one of the things I don't do with mark is play sport for exactly this reason.

You know, what was the last time he said of tory is a when someone you know, rather than giving up. So I feel like IT and pretty badly. So I like playing when I know i'll win. So I think it's a pretty good thing too.

Not see that, you see. I mean, if I were a character, I is like why spotify work that feels like there's an incredible amount of tenacity and a wilderness to run to the problem that like a lot of people had tried and failed up before. But there is also this like. You can't bite your time. You kind of wait for the opening and then you figure out a game you know that you can win and then you go execute in that game.

Yeah, that's pretty much spot. And to be honest, that's what do the things we talk about a lot that I don't say that much, but good stuff was back. Features are a product officer and C. T.

O is we? We say talk is sheep. Most people talk about execution and speed of execution.

Let's move. Let's go. We actually spend a lot of time just disgusting and talking. So the internal saying it's modifies talk is sheep because we want to be really deliberate about what is is we're doing and how we're doing IT.

You mean that is a virtue? Like talk is cheap. So let's talk a lot. Yes, expense to those resources.

exactly right? It's more expensive to build than most people think. And so we actually spend a lot of time discussing and and people get really confused when they surrender our culture. They're like, but why don't we just executed and we're still sitting in debating and sort of game theories zing how this will play out and getting all the things are working in a certain way. And we have our sort of ways of doing that now that we've sort qualified across the company, which I think is pretty unique at this point.

But a part of that is also because so to set the stage is because we had to because remember everything, unlike many other products, when you building a company, you can kind of sort of vaterland and do stuff, we had to get the entire industry with us. So if we wanted to do something, we have to convince a bunch of people that IT was the right thing to do. Um and in many cases, even making relatively simple changes could take one or two years for us to get license.

So you Better be sure that you're right when you're doing IT. And this is kind of now become a thing in how we're doing stuff is where probably not going na be the fastest. Is you moving fast than breaking things? But we are going to be very deliberate, and we're probably going to be more right when we actually do something .

you're like that anti fail fast, the anti move fast and break things, the anti ship and iterate like I like .

to hope we can also ship in a ate ah yeah yeah but we won't be the fastest now.

Which is funny. Coming back to podcasting, you didn't enter the business until twenty eighteen. I assume you were thinking about IT for a long time after that when i'm sure you know when did you become the market leader in podcasting?

Oh, I think I think IT sort of depends on which markets are kind of looking at IT, but we were pretty much IT started to happening in in quite a few markets already, twenty twenty and twenty twenty one. And in twenty twenty two, we were pretty much to marking leader in most markets around the world.

So three years yeah from watch yeah why? That's the question. And and do you expect that IT would be that fast given that you ve were so methodical and working so long to launch IT?

We don't always know how fast this will be, but I think I think we had a pretty good sense that we could sort of iterate and improve our way as sort of health climb from the mountain we were on when we saw this sort of initial traction.

But I think the contrarian that we did, unlike many of ers, died was, you know, at the time when we launched it's IT was sort of you that you needed to have a different up for everything, right? Like you had to have a separate podcasting APP and podcasting music were very difference. And for us, it's just listening.

And what we realize this, we should be used this base of what was then several hundred billion people in today's way north of half a billion people, and just serve them more stuff. And IT turns out that like what we saw the time, I wasn't like our music listeners weren't listening to podcast. So why not use this experience and also recommend them great other stuff? And we went from there. And then a year ago, we also added all your books because that turned out to be another way to increase people s listings, and that they were also spending time doing.

But but to your point on being like slow and methodical, okay, you had channel to people, okay, they know you're for listening, but if you're stuffing stuff in that channel, that is not the thing that they want that that blow up your core yeah and so I think like my take away at least is the you you figured out a way to do IT where you made sure that people we're going to be open to using you for this new yeah of course.

you're right. Obviously, just because you have the distribution advantage IT doesn't mean it'll work. But I think going back to what's so amazing with the platform is every time we try to do something, the liver sort of top down, it's sort of fail. And most of the time, actually, what we see is the increasing of something already existing on the platform and then growing from there. So I mention this at the beginning, but germany was sort of an early indicator for a lot of things for us, both in podcasting, in books.

And what I realized even before we launched book's, for instance, was around twenty eighteen we started seeing books showing up on the top list in germany, uh of the most a sort of you know uh listen to music tracks right? IT was in music. IT was clearly books, but IT sort of made IT all the way after the top less and um surely there after we started showing up as the biggest book distributor in the country.

But we weren't even trying and IT was actually a pretty horrible experience to listen to books on spotify. So when your product is being used in spite of IT actually being a pretty terrible experience, you can't know you've got something. So that was this sort of genesis for how we then were able to build and sort of expand.

awesome. Well, that's IT for this segment. Stick around and watched the rest and .

then for sure, so excited. awesome.

Well, Daniel, thank you.

Thank you so much for .

all right listeners. This is a great time to tell you about one of our favorite companies in the acquired ecosystem, status. g. As you probably know by now, status is the world's first product acceleration platform. Thousands of companies from open a eye to series a startups, rely on stat sag to ship fast, learn more and make smart decisions. But you may not know about all the ways in which their story is directly tied to facebook story that mark will share with us later this episode.

Indeed, and mark's most famous catch phrase is probably move fast and break things. But despite installing ling this in facebook engineering culture, facebook doesn't actually break very often how? But well.

facebook invested in hundreds of thousands of engineering hours in a set of internal tools. These tools let any engineer set up new metrics, ship new features and measure performance in real time. So that meant anyone could just ship a new feature, but they always had the metrics to use as garden rials, and they could always rule IT back if anything broke.

Totally awesome. You might wish that your team could build products like facebook did, ship fast, make database decisions, iterate rapidly, but you need the right tools so you're stuck right well. Enter static c static has built the world's first product acceleration platform, combining tools like feature flags, product analytics, experiment and observer ability all in one place, helping you move faster and make smarter .

decisions and even Better state. Sig was literally founded by an x meta team who wanted to help everyone build like the best. Today, many of the world's leading tech companies rely on stats, including open a eye, microsoft notion, anthropic, fig ma, plus thousands of early stage startups.

So if you're ready to accelerate your growth and democratize product building at your company, just go to static dt com slash acquired. And when you get in touch, just tell them that benin David sent you.

Yes, now is also a great time to tell you about one of our very favorite companies, the climate aligned A I infrastructure provider. crucial?

yes. Curcio is a cloud platform built specifically for A I workloads and powered by clean energy. They build and Operate GPU data centres, with each one powered by low cost stranded energy that otherwise goes to waste or worse, gets admitted as Greenhouse gases.

The way this works is completely crazy. When acquired, first started working with crucial a last year, IT was a cool idea. IT was, at early stage, very cool, kind of insane concept. Now they are one of the world's most important companies with an A I cloud that is actually superior to the hyper skillful. And a whole bunch of the largest companies in the world are now trusting their A I infrastructure to crucial.

Yeah, it's easy to think about A I is like, oh, that's a bunch of P H D over at meta or OpenAI or anthropy c, tinkering with model weights and then going and hitting compute. But there's this whole other industrial side of A I that everything that happens after they press go on model training and that energy that's cooling, that construction is literally like steel and pipes in a wire. It's all the physical infrastructure behind A I crucial has like hundreds and hundreds of construction workers, still plumbers, electricians, all building and Operating data centers in some of the hardest locations on earth.

captured this energy. Yeah, the net of all this is crucial, has giga lots of power in their development pipeline that is like nuclear reactor amounts of power for less cost than other providers and was zero or in some cases, actually emissions. And that's super important if you listen to mark talk later than the episode or elsewhere about what the bottle neck to AI progress is. It's actually not compute, but energy and crucial is solving that problem.

It's just an awesome company. Were super proud to work with them and also to be investors. The other big update that happened since we started working with them last year is that you can now work with crucial either through their managed day eye cloud, which you always good.

And that's great for startups and enterprises who wanna complete A I platform or directly as a data center customer, which yet several of the biggest companies in the world are now doing. So just going over the crucial dot A I slash acquired, that C R U S O E dot A I slash acquired, or click the link in the shown ots. Tell them the benin.

David said, you thanks, cruel.

Well, we've got a little more time before mark comes on and we have a couple more surprises planned. Um I think it's time i'd talk about the next one act to act to.

So David iris sitting around, we're planning tonight. We're like what's the thing to do and we've got all these great folks in the room who who love acquired and we're like met rather than ask them, hey, what should we do tonight? We just check our email and see like what do people actually already want when we're not even .

asking episode request?

Number one.

you go to the acquired inbox, a lot of episode request.

The second biggest request is, hey, you did this episode, you were wrong. You need to fix IT or you did this episode and like a lot has happened sense and you need to do a follow up on IT. And so we thought, what if we picked like three or four of those and we speed, run all of them with the acquired audience present?

Yep, add update required canon. And we thought, who could we do this with? And IT just so happens that the perfect person to grill us on everything we got wrong and everything we need top date lives right here in different eco. Please welcome from bloomberg and the circuit. Emily jane.

I had.

congratulations.

Thank you. I mean.

just you guys.

this is really so welcome .

to our recording to you.

Welcome to our ah thank you. I'm glad to be here.

I need to like, mind you, for some research. I know we have thing that we're doing here over the next nine minutes, but you went wake surfing with mark, like the team of tonight research, tried his fourth of july video. He is standing there in a tuxedo with an american flag, drinking a beer.

Everybody seen IT. Everybody seen this. And the tuxedos dry. Like i've wake up a couple times, I start, you know in the water and you get pulled up. I would not say, how logistically can you like step off the ball?

As you could probably tell from the episode, I am not a wake surfer, but I tried. And mark is pretty good. And what I did not realize is that you can do a dry start where you, if you're so good, you can just ride the board right off the boat, and voila.

Tuxedo surfing video. And I can personally attest that I did see him do a dry start and he can. I mean, I think it's real. I think that here.

like a lot of tuxedos on that boat and to get little trial runs.

by the way, brazil is pretty awesome too. They can both thread, just have to say here, the night our .

Emily tickets in.

So right now, and I A plus you guys for self reflection, we're going to revisit some of your past episodes. And we decided on some episodes that maybe we're a little controversial in the early days, you would grade every company that you covered and you made some good calls, but also some some questionable calls sometimes. So I thought we would go down to a little memory lane and start with youtube, which David, you gave youtube a sea in twenty sixteen.

This is the acquisition of youtube by google.

And you bench said that could be as as bad as a sea minus. And I I just I just I have to I just question that a little bit.

We were Young. He was twenty sixteen. We know we were doing.

we were missed.

But let's just twist the knife a little because we have some quotes here. Band, you said i'm a little bit barish on you to primarily because it's not a destination. And David said, like who goes to youtube and discover something?

The sad part is that we actually said that and decided to revisit this.

So I don't know IT may actually be the case that, that wasn't a huge behavior yet like the algorithm hadn't become, I know, being defensive here.

This is where we fall on our story.

Youtube was like the utility that you upload a video too, and then you could embed IT on your site. It's not like I would like start my day may be I was weird, but I couldn't imagine starting my day and going to youtube com and just watching whatever IT served me the way that now like is very easy to do that. The APP. Well, I think, okay.

So for me, there's a lots to talk about what you do that we ve got wrong. This is the biggest thing that we've discovered since is I think literally, as we were making that episode AI and social media feed recommendation, we're happening in that moment. And IT was about to lead to everything that is happening today. yes. And IT was youtube within google and Better than facebook buying GPS and building A I that turned feed recommendation into .

the ultimate destination site.

And we just completely had no idea that was happening.

right? A I had its moment a decade ago where I i'll all excited about IT now, but like the use case of recommending you something that should be the next item that you should consume was a killer use case for A I even then we miss that. Well.

today you have analysts saying if you pulled youtube out of google, IT would be worth half a trillion dollars, which is almost double where netflix is. It's on track. Youtube TV to be the largest cable provider.

Cable provider in the united states have ticket. You know, I have a houseful of kids in my house. It's the first and the second screen because we have youtube TV. So the question is, can they really be everything to everyone?

So here is here is, I think, our most legitimate defense. Google does not report youtube profitability. They report youtube revenue. So when we did the episode, tube was doing about five billion dollar run revenue. IT is now like thirty five to forty billion annual revenue run.

And IT was way losing money, like IT was a mud pit.

yes, and IT was losing a lot of money back then. Google does not report today, but here is what is unique about youtube versus every other platform is they pay out fifty five percent of revenue on long form and forty five percent on shorts directly. Two creators.

which is great for creators. But that's a tough business to when every dollar you're getting in, you're giving more than half out.

And it's a direct variable .

cost seventy billion dollars to creators over the last three years, which again is more than netlik spends on a so .

so all go on record. Youtube was in plus opposition because of the street text c value. I mean, whether it's the second largest search engine, second to google or the second largest social media property, strategically very great thing to own, not to mention going into the land of a training data. But like as a business, IT is not clear to me that youtube makes money well.

And I mean, my sources also, if they're making money is little to no money, but they could they could obviously change how much they're paying out to creators. They can turn this picket on and .

off and the durability that they are building and the affinity from creators. We'll talk about creators on the platform in a minute. Yes, is there is a reason why so many creators want to graduate youtube. yeah. And this is IT. Well.

you're going your my shoes on youtube, your shoes on youtube. How do you feel about youtube .

as creators strongly? For everyone. Listen, thank you for listening to the podcast feed where we have a direct relationship with you that is not immediate by an algorithm. But like honestly, IT is the crazy thing to see these youtube s who have built mass followings, tens of millions of hundreds of million, sometimes of of subscribe, where subscribers and views are on correlate .

grade today, grade today.

oh, a plus. So here's the other thing we didn't mention, and I think this was true back then, to youtube is both the second largest social media property in the world and the second largest third engine in the world. The way that .

you should look at youtube is not what is the the discounted cash flow of youtube as an independent business. If you look at there, you know, profitability today, it's what was the existential risk to google of not owning youtube if you to became a thing somewhere outside of google and that is worth paying a lot for huge.

Alright, moving on. The next company we're going to talk about is linton. You covered IT three days after they got bot by microsoft.

You both basically gave IT in a bad and quote, how are we both positive on this? I woke up monday morning being like, why? Oh yeah, now we've got this other one. What about linked in today?

Yeah, the VISA. We had no idea how I went because I was too recent. I think the story was linked in is IT is IT was super unclear that IT had the running room ahead of IT. Like what of the numbers on youtube today? Revenue was youtube.

I am sorry, sixteen billion plus in revenue today.

They five x reviews since they were about at eight years ago.

of which five billion comes from advertising and content, which for all intensive purposes didn't exist when the acquisition happen. We've built that into a real business. Mean, for us on acquired, you actually went looked in preparation for this.

We have about relatively equal number of followers on linked in as a platform versus any of the other social platform out there. But engagement is like five ten ex on linked in IT. I mean, it's our most important social platform. And if you had said that eight years ago.

wouldn't case the reason why this was worth a revisit and that why I think theyve been so much more successful than anyone would have thought at the time of acquisition. The five extent revenue, which you know over eight years is great, but not like three star deviation for star deviation from the mean, some of these crazy things in the world, but essentially they created a hundred billion dollars of market cap. I mean, if you look at what a reasonable multiple would be for linked in, if you wear an independent company today is a big company like IT would be a hundred and over a hundred billion dollar market cap company today. And like they just kind of hang in side, microsoft.

Revisiting this was a little traumatic for me because this was, if you'll remember, this was an acquisition that like, no one saw coming. There were no leagues, no reporting on this before IT happened. And my producer was apparently like calling my phone on stop in the morning.

I was like, the crack of dawn, and I was not picking up. So SHE called my husband who came in. I was like, microsoft just bought, linked in and you have to interview so you, jeff, winner in an hour and I was like, what? So yeah, so that's what I remember. Was that a good interview?

I mean.

I think so. I actually .

I watched IT. You said, IT, yeah, he was good.

My hair wasn't quite fully done, but we made IT. We made IT through. Okay.

you have some new reporting. I do actually because .

I talk to read hoffman, who of course is cofounder linked in and you it's interesting because read, join the board of microsoft. Still in the board of microsoft. He was an early investor in OpenAI on the board OpenAI shocker touching nadella is on the AI train early. Microsoft is the biggest barker of OpenAI now and and Kevin .

god is the city of microsoft now who came from linked in so read .

gave me a little quote. He said, sa has run d microsoft as a type of founder. You could call IT being a refounded or even a late stage cofounder. The refounded doesn't need to have have been in the garage from day one. He shifted the company's focus away from a cutthroat culture and competition only practices towards embracing social networks, collaboration, cloud and the next way wave of AI.

The question is, did he listen to our microsoft series?

I don't know. You wonder if the air wars would have played out differently. okay. We're going to keep moving quickly because I really want to make sure we get to the last one. But space ex, one of your most popular episodes ever, clear in the clear because you didn't great them. We stop grading at some point.

but obviously starling .

is a jug or not. When you talked about IT being potentially a thirty billion dollar business at the time, can you grade space acts today knowing that starlink is just even bigger?

okay. So yeah, the company was valued at thirty six billion in may. Have twenty twenty when we did the episode at that time, they had to had twenty six successful launches that year. Last year, they did ninety six lunches and there are plenty to do. One hundred and eighteen this year, which is over two a week get seen.

They're doing one every three days.

But on top of the launched business.

the launch business is not the interesting part of the business.

They now have start link, which is estimated to do six and half billion dollars in twenty twenty four, and they are reportedly profitable as a business. I'm pretty sure the seven thousand starling satellite that are in orbit represent two thirds of the total satellite orbiting the earth. And it's not just like, oh, we'll see if people want starlink.

People want starlink. I mean, the business itself, I think i'm looking at subscriber account. It's something like three million subscribers, and it's only been three years since I launch. So in the .

episode, starlink was like like pie in the sky litter. There was nothing. And now i'm pretty sure starlink is the entire like space. Ex was valued at thirty six billion when we did the episode. Starting itself is worth way more than thirty six years today.

It's a beast, total, total beast. And by the way, nobody else could save those asteroid, right? Like, I mean, that didn't have choice. yes. Well.

russia maybe, but that's .

complicated and we don't even know if china could dock at the IOS. I mean, I think that's okay to says just .

as the line, I will say it's so the starting execution is just more remarkable than like I I think ninety nine percent of people would have guessed.

Yeah okay. So now to you, your most requested revisit ever, the arena of queen, you gave her an a plus. But that was two years ago before the eras tour. So I think you're going to have to invent a new category.

So certainly, we're stop reading that's .

that's the real answer. The the context on this is its a little weird because there's no like enterprise value of twitter out there of of Taylor or out there that you can calculate.

We're not talking about I M.

There's no enterprise value of Taylor. The closest thing was when we did the episode, forbes estimated her networks at five hundred and fifty million dollars by our calculations were pretty sure SHE generated on the order of five hundred and fifty million dollars of free cash flow this this year last twelve months uh.

that's a world.

So so issue more than a billionaire.

So this is David got like an argument on this. So walk us through the you're perceived financial breakdown of swift incorporated. Yes.

tell us to think so. The big piece that I actually think is the most interesting piece that we got wrong in our episode bended a fantastic primer on the music industry um and you know all the chAllenge is far this in setter and center and like it's getting Better and you spotify doing grade and do not doing great that the latest sort of reported talked about numbers was that Taylor was making, like less than five million of dollars a year from streaming.

There was this myth that streaming doesn't pay smith.

that streaming doesn't pay a last year Taylor made over, well reported, reported this reported well over one hundred million dollars from spotify. Streaming alone alone doesn't include any of the other platforms. So you know, gross that up and by nature of what he has been doing that we talked about in that episode redoing her masters.

Like you think about what of the percentage of those streams that are happening? Are they on where he owns all the rights? Like that is a very, very, very high growth margin number that is coming the time.

So of that high hundred plus million dollars streaming number, SHE actually keeps quite a bit of IT because of this strategy that the .

amount that she's getting just from streaming, like the eras tour aside, movie aside, SHE is getting paid more every year than any hollywood actor, probably any athlete in the world. He could just sit at home.

okay.

but but he doesn't. But then, but then he .

did an error tour, which is like the most unbelievable tour that any has ever conceived of. Ver executed.

How much money do that make last year, David? So last year, the eras tour in calendar twenty twenty three gross, I think one point one billion dollars. wow. The previous which is a gross.

is are expensive a lot you know things a .

lot involved .

in making shows .

just that. The previous record for highest grossing tour ever, I believe, was a billion dollars. So Taylor eclipse that over multiple years that that was earned. So not only did he set the record for highest grossing tour, SHE did IT within twelve months. Obviously the tour has continued.

But let's say SHE Operates like a very high a high margin turing business. Let's assume she's very efficient at IT call IT a thirty thirty five percent Operating margin on the business. A lot of artists tion lose money touring anyway that's another three hundred hundred.

three hundred and fifty million dollars in cash flow every year .

yeah for at least last year during the errors to where he is making.

when he is actively talking. And then and then there's the movie, right? So the movie gross two hundred and sixty seven million dollars at the box office high, expressing concert film of all time.

Taylor went direct to the theatres with the movie, so paying less middleman, less middle. Then SHE did the direct deal with disney for the streaming rates. There was another seventy five million dollars on top of that. So well, ever three hundred million dollars from the mood, obviously going to make a movie every year. But so David.

you're kind of getting to the point of like your five hundred fifty million number of cash flow last year may actually be conservative.

I think that is conservative for last year. I think if you were say, okay, what is a smooth out steady state over a three year rolling average for tailor ink?

Now you did use .

to be an investment thousand, five billion plus .

cash flow every year. So I relist n to the tailor podcast with my kids driving a tow, and they loved that you have a potential genova audience.

Great way drug .

in case you're getting nervous. But here's a question. Is this possible that we're at peak? Taylor, okay.

So this is the most important bit debate to all of this, which is if you're trying to value the enterprise of Taylor, what multiple do you put on that cash flow, right, right. Do you believe IT is a durable .

business like some of the great content businesses of all time, like the one that you put in our model, which is disney? Yes.

disney trades at twenty x free cash flow, Taylor or is five hundred and fifty million and free cash flow. That's an eleven billion dollar enterprise value for a Taylor. Forbes currently estimates her network at one point.

one I think, and now she's in her nfl era. Like how do you value that?

right? So okay, but here's the good. I think that and I differ little bit on this, I would argue disney is .

the right top boy to look at the single greatest like IP holder in the world that has proven over a century that I can stay relevant and apply that multiple to a single artist with no diversification who has had this unbelievable ascent. And you're taking that multiple off of this extreme outlier year. Like i'm not saying IT should trade at one or two x, but like twenty x, David is a little. But your point, I think, is a very interesting one, which is when people are looking at own net worth of a person like this, they sort of foolishly don't consider IT an enterprise.

They're multiple. They're using this one.

right? Like why are you assuming that they're worth the cash in their bank when clearly they can produce these incredible returns year over year over year? So I think that's the slept done thing in Taylor.

Are we a peak Taylor? I think to me, I mean, I think I think the song that played before we started the movie walking out here, we start me up by the rolling stones tailor is the rolling stones.

This .

generation and Taylor .

are just beginning. I'm going to say no, just because that seems like a safe bet when .

you're talking about Taylor or yeah, for my own safety, i'm going to say we are not at peak Taylor, right?

You are added here for the record. I think you guys need another tailor episode. That's the verdict for the fans. Thank you guys so much, and congratulations, and I can't wait to keep listening.

Thank you. Really thank you so much.

Alright, so David, we've had Jamie diamond, we've had Daniel eck, we've had Emily chain. What is going to possibly have up our sleeves before? Mark.

we won't keep you waiting too, too much longer, but we do have one more special guest, one more surprised update in a minute.

yes. But first, David, this is a great time to tell you a little bit more about our incredible presenting partner, J P. Morgan payments.

Yes, IT. Is max and humor actually back stage? Or should we do IT life?

I think we should a life.

I think, in the spirit of doing in life. Please welcome the global coheirs of J P. Morgan payments. Max, new kitchen and ur fork.

Hi, mark.

thank you.

But welcome, guys. IT is so great to have you here listeners. I've heard us talk about jp Morgan payments all a year on acquired. But could you start maybe just with a quick overview on the business, how big IT is and how important to the world that is?

Yeah, I know everyone great to be here with you. And you know, David band, great to share the stage with you been a fantastic partnership. You talk about so many successful companies.

Look what you have created here now. Jv, more payments. In brief, we basically held companies receive money, hold money, send money, safeguard money against fraud, and take the insights from all of this to grow their business.

That takes many different forms. We had the coffee shop around the corner have a point of sales solution so they can take credit cards. We work with marketplaces or e commerce platforms, and we work with many large multination companies and even other banks. We in hundred sixty countries, and we move about ten trillion dollars, ten trillion dollars every day. That is, I think, one in every four dollars that moves around the world.

wow. wow.

So IT is, I think, probably the largest payments business in the world. And as a result, we don't only become the backbone of many companies, but sometimes of entire economies, which means we have, of course, in our DNA creativity and problem solving. But we also focus on stability, resiliency and safety. And this is why so many companies that you feature and required, actually our clients, and you know, they simply can outgrows. We always them every step of the way from start up all the way to sitting here on the chair, the last payment .

and solution you'll never need exactly.

Well, okay. So speaking of we're here in secret that go in silicon valley, the tech AI capital, the world, how is J. P. Morgan payments keeping pace with the innovation that is happening in this room all around us, the businesses that you all are building .

as back that it's part of our DNA, you have to wait to survive. We are building stuff for next five, ten and twenty hundred years. We within our on its business unit, have the largest financial blocks in life ecosystem on the planet.

We do bigger transactions than any block chain, including crypt of block chains. We basically have pretty extensive in bedded finance solutions where you might be tracking the platform. But really, it's all rails that are seamlessly saving you and then the life goes on and on.

And even in AI, which you cannot not mention anymore in the world, we use AI to catch fraud, which you can imagine you you're going to grow up some against some assistants and the the other side you need to have some you on. So we are building stuff at different scale and scope. When I think of jack Morgan payments, we perform medicals and management every single day.

great. Well, thank you so much for the great.

right? So we eluded one more thing before innovation.

We have one more thing before one.

a special treat from a past acquired guest. So one of the things that happened in the insane gear that we've had was that we had this like viral clip from an episode. This never happened in the land of acquired and IT got like tens of millions of views.

And I got picked up by forbes and fortune and the new york times and the wall street journal. IT actually went so nuts that we felt like I was kind of misunderstood and and we felt bad. We pulled the clip down because we felt like I just wasn't really explaining what the person meant correctly. And so we wanted to correct the record and have that person back via video to kind of say, IT straight, say what he meant. So everyone, jen wong.

Hi everybody is great to join you at acquired life. Wow, this is, this is really something I I still remember when when I met dave and ben, they interview me right here on this stage. H at in videos headquarters.

And now this podcast is attracted in an incredible audience, and i'm really proud of him. And one of the questions that they asked me was, was if I knew what I know now, I think, or something like that, you know what? I start in video over again.

And I said, absolutely not. Of course, I IT was taken out of context um because I was asked about that several times after that. And of course I would start the company if I knew I would turn out this way. The reason why I said what I said was was has everything to do with being an building a companies insane hard, the number of things that you have to know, the the amazing people that you have to surround yourself with, the adversity that and all the smart things that they are going to do and and and the universities you're you're onna be confronted with over time the mountain of IT in the course of thirty one years if I were to take all of that um all the chAllenges and all the hardship and all the pain and suffering of the last thirty two years and I would compressed IT into the brain of a twenty nine year old there is no way that that person would have started the company and my point there is is the super point of of entrepreneurs, which is your superpowers are partly your ignorance that that you don't know how hard did this and .

so only that's what I mean.

Everybody, just one.

Nice to have that fixed. Yes.

yes, good.

We can officially .

correct the record on that one.

yes. alright. We have finally arrived. The main event tonight is featured some incredible founder LED companies, jenson from NVIDIA, Daniel from spotify. And next we have the iconic founder CEO of our time, mark sarga.

来。 他 挑 门。 A kind.

Mark.

it's great to have you here.

It's great to bear. You know, I was watching as watching jenson's video, correcting the record. And I think to myself, we might need to book the next one of these for all the things I going to have to apologize for. I say getting, well, I don't apologize anymore.

We've noticed. Well, okay, well.

here's the question. If you knew what you knew today, what's up? If you knew what you know today, would you have started facebook?

Oh god, I mean, look, I think coming .

out a hot day.

yeah mean.

he started IT literally.

I think there's something to jenson's original sentiment, which is that the entrepreneur journey is very chAllenging, especially the early days when you're running a startup and you there's the sense that what you're doing could just die at any moment in the volatility. Everything is just going thrash so much and it's not you obviously, you look back, you have all these fun memories, but IT was not the most fun part of the journey.

Or, you know, the part of my life that I like wish I could go back and relive. So I mean, I do think that there's something too or jenson was saying that I thought was very honest and that when I heard him say at the first time I was like, yeah, I get that where it's I I think I think there are a like a lot of people for whom if you knew how painful IT would be along the way, you wouldn't get started. But then know, I think that that's one of the things that's good about human nature.

You can underestimate how painful things are going to be. That way. You can go and do good things.

Well, on that topic, we have a lot to talk about. Yeah, I think this is actually very appropriate. First, we have to ask you about your shirt and what you're wearing.

Yeah, you know, I. Started working .

with people .

to design to my own clothes. And I figure you out there are, we're going to design, I wear, we're going to design other stuff that people wear. Let's let's get good at this. And so this one, I actually, I worked with this great fashion designer, mica miry, and um he's got a great story so I won't be surprised you're doing one of these with him one day um and this one is so i've kind of start working on this series of shirts with my some of my favorite classical saying on them so this one is pathy matheus learning through suffering. A little family saying and also equus.

was that your family saying growing up? Is that your family that. Well, I .

note, but was pull that thread dolpin intended, I promise, what does learning through suffering me into you .

um what I think you learn, what matters to you and what's important and kind of your place in the world world through repeatedly hitting your head against different chAllenges. And I mean, I think that that is sort of that's the journey, right? And that's the the entrepreneur journey.

It's also, I think, part of the beauty of building things, but is something that jensen talks a lot about to. It's like I feel like you when you go to start a company, you everyone kind of writes down what they would like their values to be. But values are not when you're right down on the wall.

It's like you're lived to behaviors and you only really learn what you care about when you have to make hard trade, ffs, and face chAllenges. So yeah, do you learn the most important things? They are facing chAllenges.

Speaking of facing chAllenges, we want to talk about a number of those because we count IT by our country. I think you have faced more existential chAllenges than any meaningful company in history through your first twenty years. First.

though. Dubious distinction.

we will make our case to you a wide well and a nummer ate them. You good. But first, first.

I think my you know like that old nike Michael Jordan d where is talking about who is failed over and over over again and that's how we succeeded. That one really resonate with me too. So um thanks to .

you guys. I've got a pair of these this summer and I genuinely love them. Tell us the story of how .

these came to be yes. so. thanks. I'm i'm exd about them to so know that matter.

We've been building social experiences for twenty years now. And originally I took the form of a website and mobile apps. But the thing is, I never thought about us as a social media company.

We're not a social APP company. We are A A social connection company where I we talk about what we're doing is building the future of human connection. And that's not only going to be constrained over time to what you can do on a phone, right on a small screen.

So when you think about we get started, okay, we're like a painful of kids. And we were not able we would have the resources, the time to go defined whatever the next computing platform is. And also, facebook originally got started around the same time as you, a bunch of the early smart phones and those platforms got started. So we didn't really get to play a role in developing that platform.

And one of the big themes, I think, for the next chapter of what we do is I want to be able to build what what I think you're sort of the ideal experiences is not just what you're allowed to build on some platform that someone else built, but what is actually, if you can think from first principles, what is the ideal social experience? So I think what you would like to have, it's not a phone that you look down at that kind of takes your attention away from the things. And the people around you are not just a small screen.

I think you ideally have this glasses. And through the glasses, there's one part of IT. Where is the glasses you can they can see what you see and they can hear what you hear.

And in doing so, they can be kind of the perfect AI assistant for you because they have context on what you're doing. But in part of that is also that the glasses can project images, basically like holograms, out into the world. And that way you're social experiences with other people aren't constrained to these little interactions.

You can have in a phone screen. The not so distant future. You can imagine you guys have demos, some of the stuff that we've done, a version this, we're having a conversation like this.

But maybe like one of us seeing him here, they're just like a hologram and we have glasses. really. There's the question of delivering a realistic sense of presence. There's something magical in the realm of building social experiences around the feeling of human presence, and like being there with another percent in this physical perception, right, where we're very physical being, so people like to intellectualize everything. But a lot of our experiences very physical.

This physical sense of presence that you are with another person doing things in the physical world is something that you're going to be able to do through holograms, through glasses without being taken away from. And whatever else you're doing just kind of have that mixed in with the rest the world. It's going to be, I think, the ultimate digital social experience.

And I think it's also gonna the ultimate incarnation of AI because you're going to have conversations where it's like art. There's some people it's like maybe like on physically here. There's a person, you're like hologram there.

There's A I that is kind of body to someone is there and the glasses were unable. So okay, so how are you going after this building? This this is like some huge project.

We've been working on IT for ten years um and there are a lot of different chAllenges to solve to get there. There's like you have to build a novel display stack and it's not these are just screens like the kind that are in phones. There's this long lineage.

They're connected to the screens that have been in tvs and monitors and things for a long time. There's been this massive optimization. The supply chain, there's like brand new display stacker on holographic displays that basically need to get created and then they need to be put into glasses as they need to be minimized. And you also in the glasses need to fit chips, microphones, speakers, cameras, I tracking to be able to understand what you're doing, batteries to make IT last all day .

like new novel R F protocols.

Yes, OK, it's a pretty big chAllenge. So great. Let's go try to go for the big thing, right? And we've been working on that for a while and we're pretty close to being able to show off um from the first prototypes that we have that that and really excited about that.

At the same time, we also came at IT from the lands of bright. So that's like a lot of new technology that needs to get developed a lot to pack into a forming factor because glass that to be good looking to. So what if we just constrain ourselves to, like we're going to work with a great partner, S L luxo da.

They make gray band. They make a lot of the iconic classes. Let's see what we can fit into glasses today and make them as useful as possible. And I actually I kind of thought when we were getting started with those that he was almost like a practice project for for the the ultimate.

which lets be clear, that's what you thought facebook was.

That's true. That's true. Yeah.

I did like for your real starts.

tup. S so yes, this is that's going to tention there for second. So started facebook in school, came out to silicon valley with a dusty and and a handful of people working on at the time.

And we did that because silk values world, the startups came from. And I remember we got off the plane. We were driving down one of one like, wow, ebay, yahoo. Like this is amazing that all these great companies one day where maybe will build a company like this. And I already started facebook, and I was like, surely the project that we're working on now .

is not a company and facebook had like some scale and I was a great project.

I have the ambition to turn them into a company of the time that just kind of happened. Um but anyway. Yeah I mean, not a hard work, obviously but but but I just at the time I was going like, yeah, I don't think is that well.

that's your answer of what start? I didn't try to start facebook.

I don't know. So yeah, in the glasses though, no, we thought that this was that we want to get working with us the luxury so we can start building more and more advanced classes. And then, you know, they are really good bit, look good. And then A I like the massive transformation in A I so remember.

for listeners, this should be really clear. You guys shipped this product that i'm holding before emps or at least before the public consciousness was aware of the ChatGPT moment and these were not manufactured and shipped as an AI device that came later when they're already in market.

Yeah, a few years ago, I won't predicted that AR holograms would have been available before kind of like full scale AI. And now I think it's probably going to the other older. So now it's a kind of great well, this is actually a great product because it's got it's got the cameras so you can see what you see.

It's got the microphone. It's got the speakers you can to IT. I remember calling alex him all the guy runs the group exactly uniting them like, hey, you know, I think we should probably prevent this and make IT that that met a AI is the primary feature of IT.

And then, like, I remember, I came in the next week and i'd build a prototype of that on tuesday, and I was like, very good. Yes, this is good. This is gonna be a very successful product.

He told us a much more high stakes version of that story.

So I was on the highway with my kids, and I get this call on a saturday from mark. And he's like, those classes. Could we put mitter AI in them, running on device and like ship that soon so we can see if that a good idea or not?

Yeah, that's that tracks. That's what I just said.

Sounds right.

Okay, so. Thank you for opening up with the story. The question that I would like to try to answer tonight is why has meta worked as spectacularly well as IT has? I mean, one of the most valuable companies in the world through multiple iterations, multiple technology, waves fighting off.

You know, maybe let's name all the waves in which people said all facebook had met. Ta are so screwed. And yet that is not the way he looks today.

My space, twitter, je one, instagram, Snapchat, WhatsApp, tiktok, apple tt, putting its own whole category and now ChatGPT and like there is .

a widely held public narrative every single time stamp to discover stories. Or there's something where people like up the cool thing that facebook the company did is just obsolete now and they're gonna go away. You're very much haven't gone away. What do you think is the three line of the DNA of .

the company that allows .

you to keep winning? I think it's that were a technology company that is focused on human connection, not a specific type of APP. So like we never thought about ourselves as a website or a social network or anything like that. For me, building this kind of glasses to enable the future of people being able to feel present with another person or or where they actually physically are is the natural continuation of the kind of apps that we build today. But IT depends on how you define what you are.

And then you need to figure out, well, how do you build? How do you give yourself the competence to actually go do that? And that's where I think being a strong technology company comes in because you know, a lot of companies, I think, think about themselves too narrowly in terms of, okay, we were this kind of one thing.

And the reason why we can build all these things is because we are have a really strong technology foundation. And some of that is just me and how I think about stuff. I was an engineer before I got started. I mean, I like mostly took like systems engineering type classes when I was in college. So you you talk about like friends and mice space, all the scaling chAllenges they had doing the graph calculations of the yeah can you take us .

back and like we want to ask you the story of that time I mean, um IT seems quite now friends are my space but you study computer science graph, networking social graph. That is a very, very difficult because of the .

combination of a product question and a technology question. I think you can define the product in a such a general way that the technology becomes basically impossible itself. Um see, you want to have a smart product definition, but then you want to be completed and Better than everyone else at the technology.

And I think that, that's something that we've held ourselves to build a good organization around. It's one of the things that I observed as soon as I came out to the valley that all these companies that called themselves technology companies were not really set up that way where like the company is that I was talking about. It's like they the CEO was in technical.

The board directors had no one technical on IT. They had like one dude on the management team is the head of engineering who is technical like everyone else wasn't. It's like art.

If that's your team, then you're not a technology company. So I think one of the things that i've always been pretty careful about is I actually like one like a lot of the people on our on our management team. It's like split mostly people running either of these big product groups to come up through different technical pathways of the company.

And I think that there's A A baLance, right? So you don't want ever want to engineer because there's other things that matter to. But if you don't have enough of your kind of share of the company as engineers, then you're not a technology company.

And I think that, that also is important. The board and I think I just like in terms of how you weigh decisions and culturally, fingers inside the company matter is a lot. But but I I think that that's one of the things is that has been really fundamental right, is like we're able to kind of go from platform to platform and do these different things because we've invested, Carried about the underlying technology.

The product experiences that we build on top of that are an implementation and they matter. And for that, I think we also, I think, are prety curious and learning focus organization where I view the product strategy less is any one specific thing and more as how do we iterate and learn as quickly as possible how to make each thing Better for for the people to serve, right? So like I define our strategy, we can learn faster than every other company.

We're going to win. We're going to build a Better product than ever one else because we're going to get that out first early. We're going to have a good feedback loop. We're going to get get a bunch of feedback. We're going to learn what people like Better than other people. And then over time, by the time you get to you know whether it's a version three or four five and they're not even discrete versions because your ships are frequently and you just, uh, you learn faster. So I know that basically the formula, be a technology company, build good foundation, like learn from what what people are, are kind of focused on in the world and and rate as quickly as you can.

In one of my research calls to prep for this, someone described you as a masterful strategist, which, like, we all sort of acknowledge that at this point.

But I really excited ate like all the stuff that I just thought was not going to be that important, that ended up actually being the most important well. But that's the thing part of me is like, okay, you want to set up the games. So that way you optimize, you create your look.

This is what gets told us, like the apples gna fall from the tree in some direction. And if you just set up the game that you have a hand close enough to catch IT.

The comment that someone made to me was the reason markets such a good strategist is because he he plays the company as if it's a turn base strategy game and he just make sure he gets more turns than anybody else, and he make sure that he learned more from each turn, then the next player does. Do you feel like that encapsulates and. But IT doesn't kind of feel like the way that you make. That is like, well, if we have great engineering, then that can kind of take care of the speed part that's like many international are multiple at bats and then the will great engineering .

and speed in duration are actually two different values. They're not necessarily at odds, but I think like there are a lot of great engineering organizations that try to build things that are super high quality and have good competence around that. But there's a certain personality that goes with kind of taking your stuff, putting that out there before it's fully polished.

And and look, i'm not think that our strategy approach on this is the only one that work. I think in a lot of ways, we're like the opposite of apple. And clearly, their stuff has worked really well too.

Blame they take the approaches like we're going to take a like a long time, we're going to polish IT, we're going to put IT out. And maybe for the stuff that they're doing that works, maybe that just fits with their culture. But for us, I think that there are a lot of conversations that we have internally where you're almost at the line of being embarrassed about what you put out.

You want to put stuff out early enough, you can get good feedback. You obvious ly want to test things that are reasonable hypothesis. So if it's like so an effective, then you're not testing a good hp thesis that doesn't work. But I do think a lot of the conversations that we have are like, okay, what we can get this to be a lot Better if we work on IT for like another couple of months or whatever in. And I do just think that like you want to really have a culture that values shipping and getting things out and getting feedback more than needing always to get great positive accolades from people when you put out of out because I think like if you want to wait until you get praised all the time, you're missing a bunch of the time when you could have learned a bunch of useful stuff and then incorporate the back into the next version.

you're in a ship. And it's just about making sure what the thing that the companies is known for or its brand can withstand all the little damage that you do to IT by shipping stuff that's .

not quite ready. I would like to hope that it's not damaging to the brand. But what would .

IT in eight like when you're like, oh, I feel bad because I shipped the product that wasn't good enough.

You're sort of yeah no, I I don't know overstated. I mean, we don't ship things that we think are bad, but we also don't take and we want to make sure that we're shipping things that, that are kind of early enough that we can get good feedback to see what they're going to be most used for. Like I think a lot of the A I stop that we're building now, for example, IT, actually, it's it's pretty clear that A I is going to be transformative for a lot of different things, actually less clear what you're going to be the initial use cases for a lot of these things that, that are super valuable.

And so okay, part of IT is like, okay, you put something out, you want to kind of collect, feed back and and what people are actually what is you know where rested now if if what you put out is bad, then you're not onna collect good data because if we're going to use for anything because that sucks. So but I do you think that you have hypothesis is for where people might really want to use IT for and there are not all can be right? And you wanna a go early and found that is more? yeah.

So I building to this question of a to you is product creation an act of invention or discovery? Like, is David always inside that marble and you just need the very best tooling and ability to get things in market and get feedback to discover the statue of David? Or do you conceive of David in your head? And I like, i'm going to make this and .

put IT in the world. Does that have to be one or the other? I mean, I think it's a combination. I think you're basically taking some kind of values, either kind of like values that you have a value for something that you believe should exist in the world, and trying to build something that's a line with that, while trying to match IT up with what is going to resonate the most with people.

But I think if you if you just do the latter, then I think you just don't have enough conviction to see through hard things. And if you just do the former, then you probably don't get to product market fit or optimized what you do because you're not focused enough on your customers. So I think I think both probably matter. Yeah, as I por threw .

his historical examples, there's like the market discovers some other partisan in the markets discovers the stories format and suddenly the whole world is like you oh my god. That is the way that we all that's the social interaction mechanism. And that's like a pretty pure discovery where you have products that have stories, they perform very well that's been discovered.

But there's other times IT feels like everything you're trying to do in reality labs. All you know, fifty plus billion dollars that you've put into IT is like we are going to freak ware this thing into existence because I have an idea of the way that I want the world to be. I'm not really like asking for that much feedback. I'm put them in the world.

What's a combination. And I think that there's there's certainly a lot of things that we've invented or created for the first time. I mean, like in two thousand and six, when we built the first version of news feed before that social networks are basically and profiles and then really, hey, like people actually kind of want to get the updates and once like show them that.

And if we rank them and we can there's so many updates that this can help people pass through that quickly. And today, it's I hard to imagine any social product without a feed. So I don't know that's obviously, there are some of these things sort of seminal, I call an invention, but like patterns that we that we basically established first.

And then some of them are ones that other people did, where we take pride and learning from what is working in the in the world. You know, we're not embarrassed about learning from things that other people like discover that we're good first and and and then we build Better version of IT. And I mean.

I think that .

that you know no one company is going to invent everything, right? I think if you don't invent anything that it's hard to to to be a successful company. But but I do think that there is a mix of this. There are more smart people outside of your company than inside your company. If you're not learning from what's going on in the market, then you're missing a lot of opportunities to get valuable signal from people in the community and customers about what they want to be doing.

which speaks to the pieces of facebook is a technology company matter that is a technology company. We will get that later then. And I have been having a conversation.

I want to take this to open source and open source technology and its importance to you and then positive first to me and then to many other people in our calls over the last couple weeks that meta has been the largest beneficiary of open source technology in the modern world. And i'm curious if you would agree with that and if you would come in on your relationship. Open SARS. I think almost all .

of the major technology companies at this point are primarily using open source stacks. So yeah, I mean, I don't we wouldn't been able to get built without open source. I think probably that's true for any new company that's been created since like no nineteen the late nineteen ninety. This or something um for us, open source has been important, valuable. I mean, you are really .

the first big company built on the lap stack. Yeah yeah no.

And its its great makes its super easy to develop stuff quickly and iterate quickly. But we've all start an interesting relationship this with this because sequentially, as a company, we came after google. So google was the first of the great companies that built this distributed computing infrastructures.

They came first. They were like, let's keep this propriety is a big advantage for us and then we're like art. We need that too.

But we built IT and we're like, okay, not an advantage for us because the galeries has that. So we might as well just make IT. And by making that open, then you basically get this whole community of people building around. So IT wasn't going to help us compete with google for any of the stuff that we were doing to have that technology. But what we we're able to do with things like open compute, where um get IT to become the industry standard, it's so now you're like all these other cloud service platforms that basic use open compute.

And because of that, the supply chain of standard around standardized during our designs, which means that it's like way more supply, way cheaper to produced, we've save billions of dollars and the quality of the stuff that we get to use goes up. So aren't that's like a win, win. But I think in order for this to work, we do a lot of open source stuff.

We do a lot of close source stuff. I'm not like as ellet on this. I think open sources is very valuable. But I also think its sort of makes sense rust because of our position in the market and the same for A I I mean, OK, this is where we were going with this. Yeah it's you studio.

You we want to make sure that we have access to a leading A I model, anything just like we wanted build the hardware that we can build the best social experiences for the next twenty years. I don't think that for us is like we've just been we've been through too much stuff with the other platforms to fully depend on and anyone else. And we're big enough company at this point that like we don't have to.

Where we can build our own core technology platform is whether that gonna be A R glasses or mixed reality or A I. So I can know that somewhat of an imperative for us to to go do that. But you know, these things are not like pieces of software that are monolithic, their ecosystems.

They get Better when other people use them. So for us, there's a huge amount of good. And IT philosophically lines up with where we are, where like, I mean, look, I definitely, first hand, have a lot of experiences. We are like trying to build stuff on mobile platforms. The platforms are just .

like now you can build that. That's frustrating. We take a real quick, dear, what I really want to ask you, take a little.

Okay, you took a dear. We going to take a deep us. With our research. Here are the eve of the IPO.

There's a quite dita wait. Did or did you really in the White? Is this connected?

Or did you just decide that IT was return to talk?

Sorry, I was like.

really like one that .

I I think it's that I do .

I really, genuinely do facebook on mobile.

Is HTML .

five in .

twelve?

Yeah, yeah. I want to ask you what you were thinking going into the IPO with facebook on mobile being HTML five and what happened to IPO one hundred billion dollar market cap over the next three months? You have a fifty percent all probably because of that. But I I guess the related question to what we're talking about now is how much is that informing your approach here with I was .

a pretty different, different technical issue. So I think our legacy was building on web for websites, and we were very used to building one thing and being able to continuously deploy IT and IT fits with our iteration style and all that. So now of some, this like APP model comes along and that we have to build like different ones for each phone.

And like you have to go through approval to get a shift doing, have to weight like weeks before I can ship is like, this sucks. So right, right? We have idea. Let's build this platform where we can get a web base platform. So basically build a native share and you build this web based platform minute.

And we'll be able to just update our apps every day and will ship one thing once and update our apps across android and iphone and blackberry and windows mobile and all the stuff that existed at the time because I had hadn't gotten consolidated yet. And we like that going to be that like basically whatever downside we are going to have from not having the most native thing we're going to make up foreign philock. And by having like way more of our energy focused on one platform when we were wrong in IT, turned IT out that you know having the native integration was actually critical for having the interactions feel good and and that so we basically into this period where we had to go rewrite our apps or scratch.

And that coincided with mobile growing dramatically and mobile we didn't have any ready because IT may seem like it's president AR, but there's a very big difference on on this top. You basically have the APP and you have a column on the side that we can put ads. And on mobile, we need to figure out what does that mean to put ads into the experience?

Like to be clear, the feed ad had not been invented like .

advertisers have like formats that they like working with. And the idea that we were just going to be a guard now your ad is going to look like a feed story was a big chAllenge for advertisers. And the idea that now for people, you are going to have this organic feed that was the most important part of the product in our range to start putting ads in IT was a chAllenge for for the people are using the product.

So we need to figure that out and we need to get the apps to be Better. And we basically took, I think I must have been like a year or something. We're just like, look, we're going to pod speech development of the company because it's hard enough to do a rewrite, right? And if you look like the history of the tech industry, they're all these examples like that escape and you know these things that like they tried to do a rewrite, they needed to reestablish their technical platform.

They also try to add features and the biscuit, just like never terminated. So that's a real risk when you're like like completely changing you're underlying platform that you you're going to miss IT um was like we got to minimize the chance of that happens. So we're not ship any new features, were just going to rewrite IT, make IT faster.

Um but what we're doing this like basically mobiles growing. So the percent of our traffic that is monetization is shrinking because web is basically shrinking. And in mobiles .

only business .

model that I I like .

look and you're now recently .

prety clear what we needed to do. I think strategically, a lot of the time it's it's .

somewhat harder .

to know what to do when you're winning, when stuff is going well, like what is the next move till I go from winning to winning more. But when you're losing, it's usually pretty clear what you have to do you.

And I think a lot of IT is like, is just do you have the pain tolerance to go do IT? So a lot of this was a great the team was like, okay, what we're going public and its investors really going to like this if we are like not making money for a year and a half and it's like, well, you're a half this short in the grand scheme of things is let's do this. And what we did IT, and that was a painful, you're a half.

And then we came out of that and we were in great chip. So I think like people inside the company had felt a lot Better sooner because I was pretty clear to people that we were doing the right thing um and they they knew that we were executing in a responsible way um IT basically focused and we're doing the right thing. But I think it's actually when you have something that's working well in your own one local hill and you need to jump to another hill, that's a stuff that's really culturally hard um but this one I think was IT was not fun.

They're going a peria a serious of periods throughout the company that were not I don't know, not not the not the most fun periods. But um although that one in retrospect is now looks pretty good and not that bad. It's like your market cap only got cut in half for a year and a half like great. great. yeah. Like duck. Right.

maybe can. So can I connect the David s, hey, can you help with with our research? Can I follow that thread that you just said, hey, that one wasn't so bad. There's been a lot of amazing things the company is done and there's also been like a lot of criticism. If you were to be self critical of your own company, your own creation, of all the criticisms that have happened over the years, which do you believe is the most legitimate and why?

I mean, there are so many things that we've messed up that there are many criticisms that are legitimate. But if that was a year and a half mistake, I think one of the things I reflect done over the last like ten years or so was the political environment just changed dramatically, right? It's like before two thousand sixteen, there was like not a month that went BIOS for maybe the IPO period where the sentiment about the company was anything but positive.

And then after two thousand sixteen, after the election, business was not a month for a while where the sentiment about the company was positive. And we I think so much of this stuff is correctly understanding in your place, in the world and in history. And so I think you we taught to him before how it's like.

I think we understood that we are a technology company and that you have to be a technology company to build this kind of thing. I think we understood that we're not a social network company, were a human connection company, and we'll take different forms at our time. The political environment, I think I didn't have much sophistication around, and I think I just funding tally missed diagnosed the problem.

So I think that there was this basic chAllenge, and there are a lot of things I don't want to simplify this too much there. There are a lot of things that we did wrong with something that we did right. But I think one of the things that I look back on regret is I think we accepted other people's view of some of the things that you they were certain that we were doing wrong or we're responsible for that.

I don't actually think we were. And now that in there are a lot of things that we did mess up and we needed to fix. But I think that there's this view where when you accompany and someone says that there's an issue, I think the right instincts, just like take ownership for IT, where to say like okay, like maybe maybe it's not like maybe it's not all our thing, but we're going to fully owe this problem we're going to take responsibility for.

We're going to fix IT warn it's a political problem. I actually think a lot of the time, sometimes that their people are Operating in good faith through your identifying of a problem that wants something refixed. And there are people who are just looking for someone to blame me.

And I think to some degree, if you if if you take responsibility for things because you think it's a corporate crisis, not a political crisis, and your view is like, okay, i'm like i'm going to take responsibility for all this stuff. Like people are bisk like like blaming social media, the tech industry for like all these different things in society. And if we're going OK, we're going to really like do our part to go fixes like this stuff.

And there were a bunch of people who just took that and we're like, oh, you're taking responsibility for that. Let me like kick you for more stuff. And and honestly, I think we should have been firmer about and clear about which of the things we actually felt like we had a part in, in which ones we didn't.

And my guesses as if the IPO was a year and a half mistake. I think that the political miscalculation was a twenty year mistake. And so I started in twenty sixteen. And I think that we have been working super hard to fix a lot of issues and to figure out kind of what the right tone is for navigating what is a very kind of fraught political dynamic across both the country and to apply across all these places are around the world. And I think we've sort of found our footing and like like what the principles are like, where we think we need to improve stuff.

But where um you know where people make allegations about the impact of the tech industry or our company, which are just not founded, in fact, that I think we should push back on harder. And I think it's gonna another or ten years or so for us to kind of fully work through that cycle before our brand. And all of that is back to kind of the place that I may be could have been if I hadn't messed that up in the first place.

So but look, in the grand scheme of things, twenty years isn't that badly either and will get through IT and and I think we'll come out stronger. Um but I do think that is one of the kind of more interesting critics that I think people get. We get critics on both sides on that. There are people who don't think we've taken enough responsibility, but I I think certainly there's one line of critique is you can bought into too much of the stuff that you shouldn't have. And yeah, I think it's going to take a long time to dig out about do you have a reasonable .

framework at this point for like, okay, here's the stuff where I feel like we actually do want to take responsibility for IT and here's the stuff we're like, no, that's not default.

yeah. I mean, at this point, I think a lot of the stuff has been studied. So I think I don't want to go rehash all the different things. But but I think at this point, there's been like years of academic research on a lot of these things. And you know, part of the thing that's chAllenging is in one of the things that we learned as we actually should be trying to support more academic and doing more this research ahead of time because when you get to a point where you're being kind of accused of something you're not super credible, just standing up yourself in being A I don't think we did this one. Um you know it's like so but what has worked over time is like now you do the research in advance and and you get kind of third party academics, respected folks, you'll get to debate all these different issues and then it's oh no actually like the evidence just does not show that social dia correlated with this kind of harm at all. So I think that like or it's so I that of cuts to meet this brings up another topic .

we wanted to talk about with you and you just what's twenty years isn't that long?

Yg Young, ah we are .

just the one of being a college drop out.

found you when you're ninety.

Hopefully we have more than twenty years and hopefully .

you have like buffer duration.

You you set up the .

company in a especially at the time, truly unique way, uh, where you can Operate the company and take that take that approach. You me super .

voting shares.

superb voting shares is like know with the technical aspects. I think there are a bunch of technical aspects to IT we're not going to get into in this conversation. But effectively, you can take that perspective in a way that if you are a CEO non founder, you know it's not a structure that you've set up.

You just can't. And I think you are doing all the research for this. A thesis we've developed is that like that is just one of the core fundamental advantages that meta has. So as you were setting up the competing, you know, when you were so Young, even when you went public, you were so Young. Like, why was that so important to you?

Well.

in two thousand and six, yahoo wanted to buy the company for a billion dollars. And everyone on our management team wanted to sell IT, and the board tried to fire me and everyone. And basically in the next year, everyone else on the management team left because they, I had done good job communi don't know me.

I had done good job communicating the long time vision because I am thinking about I like wasn't thinking in terms of this as a company. I was like, this is a great project, is awesome, like a lot of people like what we're doing. I think this will probably continue for a while. I think it's can be pretty important in the world. But I didn't like know how to think in terms of you like long term financial plans or yeah .

yeah or just like, look.

we're doing this for long term, not planning on selling the company. So it's without I made that case understandable that basically yahoo comes around. A lot of people like this is like all the start of dreams come true.

You're got to take this offer um because I like I just wasn't in a place where I had the sophistication to basically articulate a lot of the stuff around where we were going longer term. If I wasn't super confidence inspiring to them when I was okay and we should turn this down because we going to do this. So so after that is like, all right, well, I don't want to get fired for my own company for wanting to build IT. So let's try to set up a governance structure that makes IT somewhat harder to do that. So wa learning to suffering.

Well and being very cash center and very early such that you had a very real going concern on your hands and you just did didn't need to cut off your ARM and sell IT to someone in order to yeah build your business yeah like I think I think this is a fundamentally .

misunderstood .

thing about facebook that started up IT is the proto .

typical of you.

the iconic start up found .

of this century. And there's a lot of people that want to start to start up for a lot of the glamorous reasons of starting to started up. You hated being a startup and wanted to stop being a start up as fast as possible. And ba like going concern yeah.

I think I having been a lot more fun now. Think that to work on all the stuff with awesome.

like what is your advice? All these founders who sort of romanticized the idea of of starting a company and kind of because I starting a companies that I mean.

I think that there's different schools have thought how to do IT. I think some people think, okay, I want to go start a companies, so i'm going to let go dive into this idea. And I didn't think that that's a little bit dangerous because there is this issue, which is you have to be able to be nimble and pivot around until you can like figure out what work, right?

I mean, part of the reason I didn't think face because going to be to the company early on was because when I was in school, I built like twelve different things, right? That I were just things that I wanted to exist. And as I got, this is fine.

Okay, let's build another thing. It's like, okay, this one point, keep are still using that, all like helping keep this one. But I like a bunch of other ideas for stuff.

I was going to build two. So I just like I didn't like know how to think about what the company was going to be and and is so i'd never something about maintaining flexibility. That's that's helpful. Once you hire a bunch of people, it's a lot easier and you can just have meetings in your own head about what direction you want to go in.

And it's like there's a lot less pride and like people dug in when you're just like, okay, i'm going to change direction and people haven't invested their ego and like, no, we were going in this direction. And like now I must be convinced. It's like now I just so I do think that that's a thing where you wanna keep things in and build to do that.

That's one of the reasons we tried to get the company back to being in a over the leaning estimation of a large company is that we can we can be. But but I didn't know there's something to that where it's like. It's obviously, it's not super fun not having the resources to do what you want to do.

But I think IT also is problematic to have more people working on something then you should have for the stage that it's at because then the people who are working on, I don't have the agency to actually like make the changes and do the things that they need to, which is less fun. And then you can attract the best people to go work on those things because it's less fun. And so I do think you've got that you just have to die at.

right? You're spending a good gillion dollars on reality labs.

and it's the technical term.

It's not making that much money. So I to play mark back to you of it's not appropriate to have all these people and resources working on things for more than the stage warrants. I'm being a little facetious here, but i'm curious how you why you .

categorize IT differently. I mean, well, I think some of the stuff by the time you're at the scale that we're at is also just about like what do you want to do over the next ten to twenty years and what do you think you're going to be important and we're talking about like making your own luck and all that and how like I think there are some broad strokes that we can have a sense of where things are going on, pretty share glasses and kind of like holographic presence and a is going to be a completely ubiquity product, right? It's just like everyone had phone before, replaced a smart phone and then a lot of more people got smart phones.

If all we get is all the people in the world's worry of glasses upgrading to glasses that have a eye on them, then like this is already going to be one of the most successful products in the history of the world. So and I think it's going to go a lot further than that. So and though there's that there is the thing of I controlling our own destiny, um it's strategically valuable.

You know we did this calculation or estimate at some point where it's like how much money do we lose from our core family of apps to the various like taxes that the platforms have to like when they tell us we can run the add business the way that we think we should be able to, when they tell us we can ship certain products to that way, like people use the things lesser like them last. And um it's hard to exactly estimated, but I think we might be like twice as profitable if we own the platform or something. So I think from that perspective, that's worth a lot just from like a peer like dollars perspective, which is not primarily how I come at the stuff.

But even like now i've learned a thing or since the other days and now I at least unable to like like I might not be able to convince the all the investors that we should be investing to the extent that we are in reality, labs, writing, control the company least. I can sort of articulated case for why I am confident that it's going to be good over time. But for me, it's always been way more about the product experience and what you can enable and build.

And you know one of the shift this is sort of like a values shift over time is one of the things is that um some the early oculus sky is used to send me that there is a difference between building good things and awesome things and and like good is good or it's helpful. It's useful. It's things that people use on a data basis because IT add something to their lives.

But awesome is different. Awesome is uplifting and inspiring. And just like leads you to just be way more optimistic about the future and is just like this uplifting thing about humanity.

And so I think a lot what we have done with social media so far as is very good. Where we've got we ve built these products. More than three billion people use them on a near daily basis.

It's three point three billion on a day. Yeah.

yeah. So yeah. And so that's and they use IT because that is useful in their life, right? And in all these different ways.

I mean, obviously, people very people use IT for different things, but it's useful. And IT helps people and IT IT helps people stay connected. That helps people build businesses that helps people form communities.

It's good done that many people on a data basis, you get out a bader like book. Yes, social media like that. I mean, not like so I kind .

of think for .

the next for my next stage, right for the next stage of the company, the next like fifteen years, I want us to build more things that are awesome in addition to things that are good. I think that they both matter um but to me, this is like a little bit of a kind of the next stage what I want our company to stand for and b and so I think a lot of the reality love stuff that we're doing is going to be in that pocket.

A lot of the AI stuff that were doing, I think it's going to be in that pocket. There are a bunch of things in the apps that are going to be in that pocket too. New apps too.

but. But I don't know. I think that there's there's just something that's like fundamentally pretty good about that. And that's maybe it's also just like where I am in my life, like like to think i'm Young a little older, right? But but it's like I do think that at this point, it's not just a Better thing. Also you know in my like personal life, a lot of what I personally value is doing things that are inspiring with people who I find inspiring. And now so there's the personal version of this so that I get to work on, you know, interesting science problems, who would like brazil's, my wife and like, and a bunch of boston people, you know, I get to design shirts with that, some of the best fashion designers in the world, right? I that use the sculpture of my wife, bring back the roman tradition of designing sculptures of people you love.

I'm not all being facilities like.

yeah, I cool. No, I I mean, I think Daniel arsa me is like a really talented guy. And I was like, that's a person i'd love to work with on something.

Go find a project, you know, building. I have one of my side projects is you have this cattle ranch and kai, and i'm trying to super and raise the highest quality beef in the world. And there's like all this stuff.

It's like starts with like it's it's awesome. We got we got the steer chunk. He's like his. He's just the man. He's the man.

We're having a hard time keeping him on the ranch because we every time we put in a steel enclosure and he sees a female cow, he bust through the steel enclosure. But I do like that the kind of bold that you want to make the highest quality work. And we're just working with you know, trying to do really high quality, awesome things with awesome people. That's if that's what I get to do for the next fifteen or twenty years, then like it's going to be a good fifteen or twenty.

Was there a moment like, what changed? But when did this become your priority and why I can't IT feel so radical? That is, how could I have possibly been gradual? Or was this just like mark all the time and we just couldn't see the real mark? No.

I think that there might have been something around the way the company shifted and Operations around covered that mean, it's like the encoded like all these two companies when remote temporarily and IT was an interesting period to just like get more time like a step back. I'm a pretty intrigued person and I do think it's I need to be careful where like I get a lot of value and energy and ideas from being around other people.

But I also need time with myself and with cover. I I kind of got that. I was a time of reflection um where I was able to think about the step. And we were also going through this very difficult political time in the country and in our company with the center of a lot of those things that that was a cause of a match of reflection.

And then I think that a bunch of the things that we had spun up earlier, but a smaller scale, right? So the reality lab stuff that we started in twenty fourteen, really the fair stuff around fundamental eye research. Um no twenty .

twelve, thirteen.

twenty twelve, then these things they kind of get started and they were growing and IT was kind of reach this moment, which is like we're going to double down on this and do this or we're gonna kind of like do this as a hobby. Like, no, I think we should do this right, as I mean this is I think that this, like this, is going be a really important part of what we do.

And we had to make a really important set of decisions where we knew is going to be really painful. You to go double down on those things and build up the AI infrastructure that we needed to and scale up from the reality lab stuff. And I knew that a lot of the investors would hate IT, at least in the short term before.

It's clearly the right thing to do. The when I didn't know was that at the time I thought they're going to not like IT, but I thought I was going to be OK because I don't think there was also going to be a recession at the same time. Um so that like really it's like I had luck.

Like like you've learned who you are through chAllenges, right? It's like we had like a really it's okay like losing half of your market cap is is quint compared to losing eighty percent of your market cap. Whatever IT was is right.

It's um but so I mean, these are all intentional decisions. So right it's like, I mean, there a lot of conversations that we had, rich, like should we go forward with this? And the answer that I came out with this, yes, I this is what I believe in.

I think this is going to be important for the world. I think it's going to work over time. We're no stranger to going through painful periods in some ways that makes the company Better. Do .

IT.

We're we're starting to enter looking at the clock like conclusion lightning round territory. I've had one like lurking in the back of my head. IT makes sense to me that you would rebrand the company something that is not facebook, given how badd the family of apps was that you've got.

Let's imagine you were going to rebrand IT today. You've got A I going on and you've got A R going on. You've got V, R going on. Would you pick the named meta if you were going to read me the company today? I like that.

See good name, you finding good short names. This actually was a thing that we talked about for well because he was pretty clear that if facebook is continuing to grow an importance in the world, which I think a lot of people don't appreciate, this kind of mind boggling the scale that it's but the others I want, we went a period of words like we had facebook and handful of smaller.

So now we have like four apps that have a billion people are more using them. You know, hopefully next three years, five with threads of that continues scaling. And this was a conversation that we had a bunch where is that doesn't make sense for the name of the company to be one of the apps as the other apps as as it's really becoming a family of apps. And IT was important to me. This was also coinciding with a lot of a lot of the chAllenges that we were having, where the political brand chAllenges is different things.

And a lot of people were proposing that from the perspective of running away from the facebook prints were like, oh, well, like is just the facebook print have issues? Do we need a new print? And I like we don't run away from that where it's I like IT might make sense one day to not have facebook be the lead brand for the company because we do so many different things.

But i'm only gonna this when we come up with a brand that is going to be evocative of the future that we're trying to build because we run towards something we don't run away from things. And when we got to meta then as a guy, we're here and I was around the time when we were doubling down on the investment and where there is all the controversy. And it's like look like if we're doing this, we're going to lean into this and we're going to do IT.

So it's do IT. And if I rather make the case to you, I feel the core competence of meta is you are able to discover products in the world. You've great ideas, you work on them, you discover interesting products.

And you, mark, are not someone who wants to define yourself by anything you want to have, like your hands on a bunch of great controls and maximize your degrees of freedom, see where the world's going, and then have the best freak in spaceship possible to go manua your way over there. IT seems like I would pick a brand that almost doesn't pigeon hold me into a specific future. I might be looking for something that's more like, look, I want to maximized my manuvers 没 yeah I .

get IT um but I don't know that just a will line around the vision and a mission of what we're trying to do and we run towards that。 That's always been how evaporated .

now and in many ways, doing what I just suggest would kind of be running. It's like what we don't believe in that much yeah like no.

no. I think where company like puts a flag down or and what we're doing and we're going to go to do IT, it's like put a wall in front of us. There's can be a mark ship pole in the wall.

Speak of living grounds and mark shape holes. You are accelerating what used to be your annual chAllenges. I always, I mean, when when we were all kids, we didn't know each other.

I am, I was so inspired. You would do your annual chAllenges. You would post about them and and like, that's like pretty dm, cool. And then we all get a little older and we all have kids on the stage now and we all have companies on the stage now. And there's some large, some small the demands on your time, like IT for me especially, and lots of people that like that space gets sucked and you have expanded IT.

how.

What you mean what you used .

to do annual chAllenge .

is and I feel doing .

great chAllenge to inspiring things. I think that yeah I don't know. And also a really .

competitive who's you your .

competition for this? What you mean?

I was just thinking about about about other things that i'm doing. Like what I start doing, I like got until bees like more extreme sports and fighting and stuff. And like I don't know, I mean, there's we face a lot of competition and a lot of different aspects of what we do.

Um so there's the social media competitors, there's the platform competitors. I think apple is is a bigger competitor than people realized that kind of think, hey, they're doing a different type of thing. But I don't know. I think over the next ten, fifteen years, I I think that kind of like battle over ideological battle over what should the architecture be of the next set of platforms. They going to be the closed integrated apple, a model that apple has always done, which again, I mean, like there's multiple there's .

multiple good .

ways to build things, right? So think if you look at the different generations of computing, pcs, mobile, they've all had sort of a closed integrated version and an open version. And the thing that I think this is just a ton of recency bias around is because .

iphone basically won.

I know that there are more android phones out there, but I mean, but iphone is sort of like the intellectual leader and by far like I think that there's the recency bias and probably like almost everyone here as an iphone. And I think because of the recently bias sort, this view that oh, oh no, this is just a superior way to do things. But I don't actually think that's a given in the PC or a windows with the open ecosystem was the leader.

And part of my goal for the next ten, fifteen years, the next generation of platforms is to build the next generation of open platforms and have the open platforms win. And I think that that's going to lead to a much more viBrant tech industry. Now there are advantages of of doing a close integrated model.

I think apple will have a place for sure. I expect them to be our primary competitor. And I think I will not be just a product competition. I think it's like a in some ways, very deeply values driven and ideological competition around what the future of the tech industry should be there. How open these platforms, whether it's things like llama I or the glasses or different things, should be for developers that an individual, someone getting started in their dorma room like me to you not have to ask for permission to go build the next set .

of awesome things.

I ve got a closing question here.

please.

Thank you. So so we have a lot of builders in the audience tonight, lot of founders. We're in probably the most interesting technology environments and the early mobile days in terms of opportunity. It's been twenty years. You might to go back a little bit, but what advice do you have for founders today on something that's different then trying to pattern match mark october's from two thousand and four given we live in a different world today?

Yeah I don't know. I mean, just that would do something that you care about and and I if if you're trying to run, arrest you trying to learn as quickly as you can. But but I mean, if there's like I think part of what i'm trying to say, I think there are different ways to build stuff, right? It's like our way worked for me and our team and it's different things have clearly worked rather companies. I don't know my daughter and went to took her to a Taylor swift concert and SHE was like, you know, dad, I can't want to be like Taylor swift when .

I grow up so yeah.

I was like, the new camp. It's not available to. I like, but and he thought about, and she's like I when I grow up, I want people to want to be like August change, zc berg.

And I was like, hEllier hEllier so I think that that yeah I don't know. I think it's like like learning from other people's successes and failures. But do your own thing.

Love that. I love that well. That is the perfect place to leave things.

We made you something that you already have a very amazing. Well, design shirt. I hope you have room in your life from more than one I do.

I used to only wear one type of shirt. Now i've move done.

So David and I made you a custom one of one shirt that represents tonight I do. IT is size luck.

So no one .

else can that can ever be made again. And we've got these coordinate on the back. The first one, GPS org PS coordinate.

The first one represents current in house, where you wrote the first line of code for facebook. And the second one is chase center. So thank you for joining us tonight.

Everyone, thank you so much. You thank you to mark sucker berg. Thank you all for making something tonight, something that we will never, ever forget, ever. We have some thank you.

We have a whole lot of thank you making today happen has taken our entire summer. It's taken the entire summer of dozens of people. They were about a thousand people working on tonight, and I just want to give them all a big can. Thank you so much.

Thank you to mark in the entire media executive team that we ve got to talk to press for this Daniel in the spotify team, Emily and Lawrence from bloomberg in the circuit, jenson, Jenny and everyone from the whole and video team to air means for dressing us tonight. Thanks, White presentable. To our families and our lovely wives.

Thank you so much. Most importantly, thank you to our wives.

and of course, thank you to Jamie diamond. J. P.

Morgan chase, J. P. Morgan. Payments for making this whole evening possible. It's going to dream partner. We are so grateful listeners.

we will see you see next time.

and thank you.

Might taller.

Everyday, thank so much.

Who that is, let me down, say the now everybodies talking nobodies with these days, I feel. Everybodies fighting boys.

Oh, baby, the sort didn't know. Who can you? Please see me down. Not the story of the way who can you know not here to you, not free. on.

Everybody, wake, wake, wake you up the dinner. Oh, baby.

Is you me down story? 不会 的。

快乐。 怎么 这些。

不 看得出。

Let's give IT.