Invest Like the Best with Patrick O'Shaughnessy: Josh Kushner on Building Thrive Capital [Invest Like the Best, CLASSICS]
Introduction
In this engaging and insightful episode of Invest Like the Best, host Patrick O'Shaughnessy sits down with Josh Kushner, the founder and Managing Partner of Thrive Capital. Released on March 28, 2025, this classic episode delves deep into Josh's investment philosophies, the growth of Thrive Capital, and his personal journey as both an investor and entrepreneur. Through a rich conversation, listeners gain valuable perspectives on building a successful venture firm, cultivating exceptional talent, and navigating the ever-evolving investment landscape.
Background of Josh Kushner and Thrive Capital [00:00 – 03:05]
Patrick opens the conversation by introducing Josh Kushner, founder and Managing Partner of Thrive Capital—a venture firm established in 2010. Thrive launched its first institutional fund in 2011 with $40 million, leading significant investments such as Warby Parker’s Series A and Instagram’s early stages. Over the past decade, Thrive has grown exponentially, now managing $15 billion with a tight-knit team of nine investors. The firm is stage-agnostic, boasting a portfolio that includes Spotify, Unity, Stripe, and Twitch, among other industry giants.
Team and Low-Profile Philosophy [04:29 – 06:49]
Josh emphasizes Thrive’s unique approach to teamwork and maintaining a low public profile. He explains, “Every single win that we have is the entire firm's win, and every single loss that we have is the entire firm's loss” [05:31]. This philosophy ensures that credit and responsibility are shared collectively, fostering a strong team dynamic. Josh recounts a pivotal moment during Thrive's investment in Slack, where team consensus rather than individual acclaim guided the decision to proceed, highlighting the importance of collective judgment over personal recognition.
Taste, Design, and Continuous Learning [07:16 – 08:16]
Patrick asks Josh about Thrive’s focus on taste development, particularly in the consumer space. Josh responds by stressing the importance of questioning and appreciating quality: “Good design does have some basic principles” [07:16]. He cites leaders like Bob Iger and Rick Rubin as exemplars of exceptional taste and creativity, underscoring the need for continuous self-questioning and innovation to maintain high standards in investment decisions.
Inspiration from Rick Rubin's "Rules" [08:27 – 10:11]
Josh shares his admiration for Rick Rubin’s philosophy, particularly the line: “pay attention to what you notice, but what no one else sees” [08:27]. He discusses how rigid rules can constrain creativity and argues for maintaining a sense of naivety to foster innovative thinking. This approach aligns with Thrive’s ethos of pushing boundaries and questioning conventional wisdom to uncover unique investment opportunities.
Philosophy of Independent Thought and First Principles [10:11 – 12:29]
Josh highlights the importance of independent thought and adhering to first principles. He recalls advice from Charlie Munger about prioritizing learning over self-promotion: “What's the point in telling everyone all that you know, it's a lot more fun to learn about things that you don't know” [10:56]. This mindset encourages deep listening, continuous self-improvement, and resisting external validation, which are foundational to Thrive’s investment strategy.
Motivation and Founder's Drive [12:29 – 16:50]
Patrick explores the sources of drive and motivation in founders. Josh explains Thrive’s focus on inputs rather than outputs, believing that solving meaningful problems leads to sustainable success. He distinguishes between founders motivated by external validation and those driven by mission or ambition: “Those that are motivated by a mission or a cause or the ambition to solve a problem are the ones that will ultimately achieve it” [13:10]. This perspective ensures Thrive partners with founders who are intrinsically motivated and committed to long-term impact.
Building Thrive and Culture [16:50 – 26:34]
Josh delves into the story of building Thrive Capital and the importance of culture. He recounts the inception of Oscar Health, inspired by personal experiences with healthcare inefficiencies and the Affordable Care Act’s market shifts. Josh emphasizes that Thrive is not just an investment firm but a company in itself, focused on creating a meaningful partnership with founders. This culture of empathy, shared struggles, and continuous iteration fosters a supportive environment for entrepreneurial success.
Notable Quote: “We should only try to be a part of things that have really grand ambitions” [23:34].
Investment Strategies and Fund Progression [30:09 – 34:59]
Josh outlines Thrive’s investment strategy across its four funds. Starting with Fund 2, Thrive led investments in Warby Parker and Instagram. Fund 3 included significant incubations like Twitch and Spotify, while Fund 4 marked a shift towards concentrated positions in top-tier companies such as GitHub, Slack, Stripe, and Unity. This evolution reflects Thrive’s disciplined approach to focusing on exceptional businesses and maintaining concentration in high-potential investments.
Notable Quote: “Every single offer that we give to people on the investment team is with the expectation that if they are successful, they will be a partner at the firm” [47:54].
Team Building and Talent Recruitment [38:19 – 48:09]
Josh emphasizes the critical role of talent in Thrive’s success. He differentiates between intelligence and smartness, seeking individuals who possess creativity, analytical prowess, and a passion for deep, independent thought. Thrive prioritizes hiring exceptional talent who are driven by self-improvement and can contribute uniquely to the team, fostering a culture of excellence and innovation.
Real Estate Analogy for Investment Philosophy [49:47 – 53:57]
Josh uses a real estate analogy to explain Thrive’s investment philosophy: “We invest in Fifth Avenue” [51:18]. He illustrates that investing in top-tier companies ensures compound growth over time, much like owning prime real estate that appreciates in value. Conversely, investing in lower-tier opportunities without the same potential rarely yields significant returns. This analogy underscores Thrive’s commitment to quality and long-term value.
Views on Current Investment Climate [55:59 – 71:37]
Drawing from his experiences during the financial crisis, Josh discusses the importance of understanding the macro environment without being deterred by it. He advocates for leveraging tailwinds and maintaining focus on fundamental trends, such as technological innovation and exceptional leadership. In the context of AI and emerging technologies, Josh highlights the critical decision of where value will accrue, emphasizing Thrive’s strategic investments in pioneering companies like OpenAI.
Notable Quote: “Do we believe in the fundamentals of the space that we're working in? Do we believe that the long term trends associated with technology innovation are going to move in a very particular direction?” [55:59].
On crypto, Josh explains Thrive’s cautious approach: “We have a core belief that there's an important place in the world for crypto” but refrains from investing in solutions in search of problems, focusing instead on clear, understandable applications.
In fintech, Thrive invests across infrastructure and consumer-facing services, believing in the continued innovation and consumerization of financial services.
Inspiration and Mentorship [74:15 – 84:05]
Josh discusses the influence of mentors and industry leaders such as Bob Iger, Stan Druckenmiller, Henry Kravis, and David Geffen. These figures have imparted lessons on effective communication, firm-building, and balancing macro and micro perspectives. Josh attributes much of Thrive’s success to these mentorship experiences, which have shaped his strategic thinking and leadership style.
Personal Life and Values [85:47 – 99:42]
Josh shares personal stories that highlight Thrive’s values of humility, integrity, and work ethic. He recounts a high school incident where a stranger’s kindness profoundly impacted him, reinforcing the importance of empathy and generosity. Additionally, Josh discusses the role of family and fatherhood in shaping his priorities, emphasizing the significance of being present and maintaining a work-life balance through practices like the Sabbath.
Notable Quote: “There is no substitute for hard work. There is no substitute for willing to outwork someone else” [43:42].
Conclusion: Culture, Values, and Future Outlook [100:00 – End]
In the final segment, Josh elaborates on Thrive’s culture of balancing patience in decision-making with impatience in seeking knowledge and adapting to new information. Despite managing a large asset base, Thrive maintains a small, highly impactful team, ensuring each member is deeply committed and capable of driving the firm’s mission forward. The recent sale of a 3% stake to prominent investors like Bob Iger and Mukesh Ambani underscores Thrive’s commitment to building a network of exceptional partners.
Notable Quote: “We are incredibly impatient as an organization in terms of trying to understand everything that we possibly can around every theme, but we're extremely patient around what we ultimately decide to do” [82:34].
Josh concludes by reaffirming Thrive’s dedication to independent thought, concentration on top-tier companies, and evolving as a meaningful partner to founders. The conversation wraps up with personal reflections on talent, ambition, and the continuous pursuit of excellence both professionally and personally.
Notable Quotes with Timestamps
- [05:31] Josh Kushner: “Every single win that we have is the entire firm's win, and every single loss that we have is the entire firm's loss.”
- [08:27] Josh Kushner: “pay attention to what you notice, but what no one else sees.”
- [10:56] Josh Kushner: “If you're not embarrassed about who you were two years ago, you're not growing.”
- [23:34] Josh Kushner: “We should only try to be a part of things that have really grand ambitions.”
- [43:42] Josh Kushner: “If you have to choose between the most experienced person, the most educated person, or the person who actually wants it the most, you always pick the person who wants it the most.”
- [51:18] Josh Kushner: “We invest in Fifth Avenue.”
- [55:59] Josh Kushner: “Do we believe in the fundamentals of the space that we're working in? Do we believe that the long term trends associated with technology innovation are going to move in a very particular direction?”
- [82:34] Josh Kushner: “We are incredibly impatient as an organization in terms of trying to understand everything that we possibly can around every theme, but we're extremely patient around what we ultimately decide to do.”
Final Thoughts
Josh Kushner’s conversation offers a profound look into the values and strategies that have propelled Thrive Capital to its esteemed position in the venture capital landscape. Emphasizing team cohesion, independent thought, and a commitment to excellence, Thrive’s approach serves as a benchmark for aspiring investors and entrepreneurs alike. Through humility, continuous learning, and a focus on meaningful partnerships, Josh and his team at Thrive Capital exemplify the principles of successful and principled investing.
End of Summary