Alexis Ohanian and Anthony Pompliano

Building & Investing in the Modern Digital World | Alexis Ohanian on The Pomp Podcast

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Key Takeaways

  • Co-founders need to have more than just complimentary skills; their values and world views have to be aligned
  • “All companies have problems all of the time, what’s important is that they are good at triaging the most important ones as fast as possible” – Alexis Ohanian
  • When it comes to automation and developing software, repetitive and tedious tasks take priority (e.g. generating reports or managing deal flow)
  • Initialized Capital uses an internal software to promote information sharing and collaboration
  • Industries like Telehealth, Crypto, and Remote learning are poised to do well in the wake of COVID-19
  • Just finished school? Here is some advice:
    • Focus on the things you can control, work very hard to improve on those things and get better at them
    • Find things you love doing, that are viable in a new economy, and that won’t get automated away – Double down on those things
    • The cheat code for the new economy: Learn to code
  • High school graduates will start thinking twice about taking student loan debt for going to universities
  • Because their jobs are not easily automated, skilled labor (welders, plumbers, electricians, etc.) will stay in demand
    • To solve the potential shortage of skilled workers, a re-imagining of trade schools is needed – think: General Assembly for skilled labor
  • Identifying trends and finding the signal are essential to understanding where the future is headed and investing – Following the right people gives you an advantage

Books Mentioned

  • Alexis’s favorite book: Drive, where author Daniel H. Pink explores what motivates people
    • Understanding human motivation and incentive guided Alexis’s thinking about startups and products
  • In Winners Take All, author Anand Giridharadas investigates how the global elite’s efforts to “change the world” preserve the status quo and obscure their role in causing the problems they later seek to solve

Intro

Co-Founding Reddit & Initialized Capital

  • Paul Graham’s talk: How to Start a Startup was influential for thinking about startups  
    • Paul asked the founders: “Build something in a web-browser that solves your problem every day, what do you do every day?” – For Alexis, that was opening many tabs on Firefox
    • Reddit was then founded as the “front page of the internet” to aggregate content
  • After selling Reddit, Alexis co-founded Initialize Capital “to be the early stage investors that we wished we had had when we were in the trenches so founders can avoid the mistakes we made”
  • Alexis may dwell on having sold Reddit too early, but he also recounts all his life accomplishments that wouldn’t have happened if he didn’t

Organizational Structure, Culture, and Tools

  • Co-founders need to have more than just complimentary skills, their values and world view have to be aligned
    • Being successful will mask co-founder problems, but having common ground is what supports founders during hard times
    • For instance, Alex and Garry have a positive-sum world view and they promote that mindset at Initialized Capital
      • Additionally, they have regular sessions with their coaches and they embrace hard conversations
    • Maintaining physical and mental health is important
  • When it comes to automation and developing software, repetitive and tedious tasks take priority (e.g. generating reports or managing deal flow)
  • Initialized Capital uses an internal software to promote information sharing and collaboration
    • For instance, having notes from meeting or phone calls stored in a structured way, available for all employees to see – This has several benefits:
      • Anyone can add value and solve problems, or learn from it
      • You can look back and see how your thought process evolved and what changed
    • Always be learning, and let software do the hard part – remembering everything
  • “All companies have problems all of the time, what’s important is that they are good at triaging the most important ones as fast as possible” – Alexis Ohanian

Industries Poised to Do Well in the Wake of COVID-19

  • Telehealth industry will thrive with people utilizing technology to connect to doctors and get treatments when and where they need it
  • Bitcoin and crypto will go mainstream, boosted by the economic conditions and (Money printer going Brrrrrrrr)
    • Focus on companies building the infrastructure to support buying and using crypto
    • Crypto bear markets are important to cleanse the charlatans and focus on real problems
  • For Reddit, crypto can be used for seamless payments and monetary interactions (think users making deals, tipping, providing services, etc.) 
    • “The more that we can do to help communities and users strengthen their relationships to one another and make money in a way that they are happy with, the more we win” – Alexis Ohanian
    • Revenue streams that build on community dynamics and add value will overtake the traditional ad-revenue model
  • Remote learning will see a huge bump in the future

Life Advice for Kids Starting-out

  • Focus on the things you can control, work very hard to improve on those things and get better at them. Spend as little time as you can dwelling on the things you can’t control
  • “Doing what you love” isn’t great rational advice – instead,
    • Find things you love doing, that are viable in a new economy, and that won’t get automated away – Double down on those things
  • The cheat code for the new economy: Learn to code
    • Put in the work and you will be rewarded with fulfilment and a skillset that stays in demand even during economic hard times

Re-imagining Education

  • High school graduates will start thinking twice about taking student loan debt for going to universities
    • There should be cheaper ways to get quality education in the new economy
    • That said, top tier schools will still do fine because of all the credentialing, but many schools will feel the impact of this
    • We can learn from the well-intentioned mistake of encouraging everyone to go to college, and instead have a critical serious look at what people enjoy doing
  • Because their jobs are not easily automated, skilled labor (welders, plumbers, electricians, etc.) will stay in demand
    • As Alexis puts it: “Building a robot that can come in to this office and figure out what’s wrong with my toilet is really hard”
    • To solve the potential shortage of skilled workers, a re-imagining of trade schools is needed – think: General Assembly for skilled labor
    • Tip: If you like working with your hands or are going to college because this is the way things are, then reconsider
  • A good bi-product of all the COVID-19 isolation is resurrecting a self-reliance culture – For instance, nations building and maintaining their own infrastructure and products
    • Unfortunately, this shift inwards will come at the expense of the free-flow of information, ideas, and humans
    • This will likely give rise to decentralized networks that can transcend national borders

The Fifth Estate: Social Media

  • COVID-19 has demonstrated the strength of social media, which was ahead of the government and traditional media at preparing us for the crisis
  • Individuals are developing their own media brands and capturing the value in being right early on – Let’s Expand:
    • Identifying trends and finding the signal are essential to understanding where the future is headed and investing – Following the right people gives you an advantage
      • An interesting question becomes: How to do the “accounting” of the Internet?
      • It used to be by subscriber count. be by some blockchain to show it? – “I think the answer to that is going to be really valuable in years to come”
  • Social media allowed us to find our tribes, but it makes easier to isolate from ideas that challenge our world views – make an effort to read those ideas

Additional Notes

  • On parenting: It puts into perspective the meaning of your life and forces you to be a better person
  • Has Alexis ever beat Serena at anything athletic? Yes, Basketball
  • A wish: COVID-19 giving us that “Independence Day” movie moment of uniting humans and bringing us together
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Notes By Mostafa Khaled

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