Tim Draper: How I Spot Billion-Dollar Companies Before Anyone Else | E158

Summary

Leap Academy with Ilana Golan

Episode 158: Tim Draper – How I Spot Billion-Dollar Companies Before Anyone Else

Date: May 12, 2026
Host: Ilana Golan
Guest: Tim Draper (Venture Capital Investor, Founder of Draper University)

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Overview

In this energizing and candid episode, Ilana Golan sits down with legendary venture capitalist Tim Draper to explore the mindset and strategies behind spotting and backing billion-dollar companies before anyone else. Tim shares colorful stories from his journey, lessons from early entrepreneurial hustles, the pain of downturns, his viral growth hacks (like the iconic Hotmail tagline), and foundational advice for entrepreneurs facing risk and reinvention. He also offers insights into the future of tech—AI, crypto, and beyond—and gives actionable guidance for those looking to leap in their careers.

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Key Discussion Points & Insights

Early Entrepreneurial Lessons

• Apple Stand and the Reality of Capitalism vs. Socialism
  • Tim shares a formative childhood story of selling apples from his driveway, only to have his neighbor’s mother redistribute the proceeds among helpers and herself:
    • Quote: “That was my first exposure to socialism and I don’t like it at all. Capitalism’s way better. Socialism creates lazy socialists and capitalism builds great businesses.” (04:29)
  • Tim’s drive to try and learn from doing—whether hawking apples or peddling oysters—shaped his resilience and creative salesmanship from a young age.
• Boarding School Adventure
  • Attending Andover at 13, Tim learned independence, time management, and perseverance, noting the jump in academic and life responsibility:
    • Quote: “I had to do it on my own. Had to go buy the toothpaste. Andover really piles on the work.” (11:12)

Journey into Venture Capital

• Family Legacy & Forging His Own Path
  • Belonging to a VC pioneering family, Tim was still an industry trailblazer, taking a $6 million SBA loan to build his own venture fund:
    • Quote: “Taking $6 million loan is really, really scary at a young age… but I wasn’t putting my life at risk. It wasn’t a personal guarantee, which I would never recommend anybody sign.” (17:08)
  • Tim candidly details early risk, lessons in finance, and why knowing the downside is crucial—but not allowing fear to drive decisions.
• Omnipresent Approachability Drives Opportunity
  • Tim describes how being accessible, speaking, and giving out his email has led to serendipitous investment opportunities—his “yes” mentality opens doors:
    • Quote: “A lot of it is you build your judgment by learning about what’s out there... I get out, I speak, I give people my email address.” (22:24)

How Tim Spots Billion-Dollar Potential

• Errors of Omission vs. Errors of Judgment
  • Tim highlights that his biggest regrets were passing on ideas (Netflix, Google) rather than picking the wrong ones.
    • Quote: “Most of my mistakes were errors of omission, not errors of judgment.” (21:17)
  • Stresses the importance of wide deal flow, approaching ideas curiously, and selecting for world-changing potential.
• Judging “Crazy” Ideas
  • Tim’s decision-making lens: “How big is the opportunity—is it worth being misunderstood for a while?”
  • The best investments come when thinking beyond consensus—if the future you envision outweighs fearing criticism, you’re on to something.

Memorable Moments (Growth Hacks & Game-Changers)

• Hotmail “PS: I Love You” Legend
  • Tim advocated placing “Get your free email at Hotmail” in each message, sparking viral growth with zero ad spend:
    • Quote: “They looked at me like, what are you thinking?... It spread to 11 million users in 18 months. Fastest growing consumer product in the history of the world [to that date].” (23:06—25:51)
• Skype’s First Video Call
  • Tim accidentally facilitated Skype’s first-ever video call during a conference:
    • Quote: “Nicholas is laughing... that was the first Skype video ever.” (28:36)
  • Of the internet era’s impact: “Suddenly it’s happening for free. The world just opens up.” (27:08)

Navigating Setbacks & Fear

• Endurance through Market Crashes and Lawsuits
  • Tim discusses the crash after the dot com bubble and the emotional challenges of facing lawsuits and downturns:
    • Quote: “My worst decisions were all made out of fear, and my best decisions were made where I go, God, what if this works?” (32:24)
• Tactics for Survival
  • Treating life as a chessboard and an adventure; do the hardest thing first each day for confidence and momentum.

The Role of the Gut in Big Leaps

• Gut vs. Brain
  • Tim encourages listeners to listen to both their gut and brain when considering big career moves:
    • Quote: “Follow your gut... it will find the place that you should be.” (39:38)
• How to Act Despite Fear
  • If fear is louder than the opportunity, it might not be your leap to make. But if the vision outweighs social and financial worries, you’re an entrepreneur.
    • Quote: “Most people aren’t really thinking about the future you’re trying to create... If those voices are bigger in your head than the opportunity, then you should not be an entrepreneur.” (40:38)

Celebrating Entrepreneurship & Changing the Narrative

• Role Models & Media
  • Tim calls for media and society to celebrate founders like Elon Musk, Jeff Bezos, and others, inspiring the next generation rather than dragging success stories through criticism:
    • Quote: “They need to be celebrated. So that 10 year old boy or girl says, I’m going to be better than that guy.” (44:28)
  • Points out the value created by entrepreneurs compared to political leaders: “I would so much rather Elon Musk put a billion dollars to work than any politician who won a popularity contest.” (46:02)

Reinvention & What’s Next

• Advice to those at a Crossroads
  • Try, experiment, take a step. Learning (sometimes through setbacks) is inevitable and invaluable:
    • Quote: “Take a step, try it. You learn so much when you try things. At least I do.” (48:19)
  • “It’s never been easier to experiment things than it is now.” (48:50)

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Notable Quotes & Memorable Moments – With Timestamps

• On learning from mistakes:
  “My worst decisions were all made out of fear, and my best decisions were made where I go, God, what if this works?” — Tim Draper (00:00, repeated 32:24)
• On viral growth:
  “What if you put a little message at the bottom of everybody’s email... It spread to 11 million users in 18 months.” — Tim Draper (23:06)
• On opportunity and risk:
  “I always try to do the hardest thing I’m going to do that day first. Get that done, get it out of the way, and then the rest of the day is a little easier.” — Tim Draper (00:26, repeated 32:24)
• On fear as a filter:
  “If those voices are bigger in your head than the opportunity, then you should not be an entrepreneur.” — Tim Draper (40:38)
• On the media’s role:
  “They need to be celebrated... I would so much rather Elon Musk put a billion dollars to work than any politician who won a popularity contest.” — Tim Draper (44:28, 46:02)
• Advice for reinvention:
  “Take a step, try it. You may have to take two steps back before you take another step. But take a step.” — Tim Draper (48:19)

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Timestamps: Key Segments

• 00:00–04:29 – Tim’s early lessons in entrepreneurship and “capitalism vs. socialism” apple stand story
• 06:06–08:16 – Oysters, bump-in-the-road mishaps, and learning through trial and error
• 14:45–19:47 – Getting into venture capital, taking a $6M loan, and the psychology of financial risk
• 20:26–21:34 – How Tim filters “crazy” ideas and the power of building judgment through exposure
• 23:06–25:51 – Hotmail’s viral hack and the impact of creative, low-cost marketing
• 26:08–29:19 – Skype’s global impact, video call origins, and the power of network effects
• 30:01–36:46 – Surviving downturns, crisis management, and the mental approach to setbacks
• 39:05–40:38 – Gut vs. brain: decision making for big leaps
• 44:28–46:02 – Why founders must be celebrated and society’s shifting relationship with success
• 47:11–47:55 – How to get on “Meet the Drapers” and the structure of Draper University
• 48:19–49:12 – Final advice: keep experimenting, learn by doing

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Guidance for Listeners

• Apply for Meet the Drapers or Draper University:
  Go to meetthedrapers.com or search for Draper University to explore entrepreneurship programs.
• Advice for founders:
  Don’t let fear drive your decisions. Listen to your gut, act on opportunity, and keep experimenting despite setbacks.
• Career Leaping:
  Take intentional risks, reinvent when you feel stale, and remember that it’s never been easier to test and launch ideas.

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Episode Tone & Tim’s Character

The conversation is warm, energetic, and story-filled. Tim is approachable, reflective, and candid—quick to share both wins and stumbles. Ilana’s probing but uplifting questions help surface practical wisdom and personal nuances. The episode leaves listeners inspired to dream big, fail fast, and act boldly.

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For aspiring entrepreneurs, investors, or anyone stuck at a career crossroads: this episode delivers both encouragement and concrete, lived lessons on risk, resilience, and reinvention.

Transcript

[Tim Draper]

The dot com market just fell under our feet and everything dropped 95%. All these investors came, and I felt like I was on a firing line. My worst decisions were all made out of fear, and my best decisions were made where I go. God, what if this works?

[Ilana Golan]

Tim Draper, he is one of the most legendary investors. He has incredible ability to spot the future before it happens.

[Tim Draper]

I always try to do the hardest thing I'm going to do that day. First, get that done, get it out of the way, and then the rest of the day is a little easier.

[Ilana Golan]

How do you decide if something is a crazy idea that's going to fail or a crazy idea that will change the world?

[Tim Draper]

So a lot of it is you build your judgment by learning about what's out there. And I've made lots of mistakes, and most of my mistakes were errors of omission, not errors of judgment.

[Ilana Golan]

You're afraid of people hating you, judging you, or what will societies say. There's all these things that are coming your way. How do you still take action?

[Tim Draper]

Most people aren't really thinking about the future you're trying to create. If those voices are bigger in your head than the opportunity, then you should.

[Ilana Golan]

Welcome to the Leap Academy with Ilana Golan show. I'm so glad you're here. In the Leap Academy podcast, I get to speak to the biggest leaders of our time about their career, how they got where they are today, the challenges, the failures, and countless lessons. So lean in. This episode is going to be amazing. I'm in a mission to help millions reinvent their career and leap into their full potential, land their dream roles, fast track to leadership, jump to entrepreneurship, or build portfolio careers. This is what we do in our Leap Academy programs for individuals and teams. And. And with this podcast, we can give this career blueprint for free to tens of millions. So please help my mission by sharing this with every single person you know, because this show has the power to change countless of lives. Dio. Okay, so let's dive in. I met our next guest when I was just starting my own entrepreneurial journey. And it felt rare meeting someone so successful and yet seemed so down to earth. Wicked smart, so approachable. Tim Draper, Seriously, that was such a great first step into the entrepreneurial world. And he is one of the most legendary investors. He has incredible ability to spot the future before it happens, backing companies like Hotmail and Skype and Tesla and SpaceX and Coinbase and Robinhood and I could go on. But really beyond his incredible portfolio, Tim is really a dedicated educator. He founded Draper University, which we'll talk about. And really to help the next generation of entrepreneurs to dream big, make it happen. And through that they created 6000 innovators, 103 countries, sparkling, I don't know what, 1500 companies, seven unicorns. Like, seriously incredible. Excited to have you here on the show, Tim.

[Tim Draper]

Great to be here. What a fun intro. You did a great job. We're happy to be on your show. And I have a show too, it's called Meet the Drapers and it's great fun. I interview four entrepreneurs each time and it now reaches about 300 million people and about 20 million see it every episode. And now about 2.5 million are in are on YouTube watching. So very exciting.

[Ilana Golan]

That is really exciting.

[Tim Draper]

It's real entrepreneurs and the winner of a whole big competition gets a million dollar investment.

[Ilana Golan]

Oh my God.

[Tim Draper]

I like being entrepreneurs and spreading the good word about entrepreneurship and venture capital around the world all the time. And I do it through the school and the show and being a venture capitalist myself.

[Ilana Golan]

I know, and I want to take you back in time, if that's okay, Tim, because you've been an entrepreneur from a very young age. Like you. What was selling apples as a kid or something? Like, how did you.

[Tim Draper]

How did you know that?

[Ilana Golan]

Hey, I know a lot about you, Tim, so talk me back in time.

[Tim Draper]

Yeah, I think I was about 8 years old and I was discovering money and we had an apple tree. So I picked all the apples from the apple tree or I picked a bunch and then I brought them. We had a very long driveway, it was about a quarter of a mile long. And so I went out to the road and sold those apples and every once in a while some friends would come by and whatever. And so I did it for about three weeks. And one day my neighbor's mother came over and my neighbors were hanging out with me and neighbor's mother came over and said, so how much have you made? And I'm thinking over the three weeks, $8. And I said, fantastic. And she picks up the $8 and she hands one to one of my friends, one to another friend, one to another, one, one to me, two to two other people, and walks away with $3. That was my first exposure to socialism and I don't like it at all. Capitalism's way better. Socialism creates lazy socialists and capitalism builds great businesses and builds progress and everything else. So I, yeah, that was my 8 years old. I was the biggest capitalist there is. And I didn't understand how she could have done that just because she was an Adult.

[Ilana Golan]

But what a great lesson.

[Tim Draper]

Oh, boy. Learned very well.

[Ilana Golan]

I mean, that sparked some fuel right there.

[Tim Draper]

I mean, the other great fun story of entrepreneurship for me was I sold oysters. I was about 20 years old, and I sold oysters, and I'd go up to Marin county and buy them for a dollar a dozen from this old fisherman. And all week I would be calling different people. Anybody who wanted to, you know, I dialed for dollars all week. And then Fridays, I'd go and pick up the oysters, and I'd sell them for $6 a dozen. And I'd always buy a few extra dozen so that I could sell more, just hoping that I'd be able to sell more. So the garage just got smellier and smelly. And then I sold to this one guy, and he put one in a microwave, and it was delicious. We said, oh, my God, this is the greatest. Put the oyster in a microwave. And he wanted an oyster bar. And he kept ordering more and more and more. And I was thinking, God, I got a real customer here. And then I went up and I was selling into door to door. I sold to this woman, and I said, yeah, they're great. If you put them in the microwave, they're fantastic. So I demonstrated. I put it in her microwave, and I hit the thing. Boom. We had oyster all over the microwave. It was just a disaster. She was very nice. She bought two dozen oysters, but I don't think she put them into the microwave after that. And I don't know who. She must have had to clean it up because I didn't. Oh, God, it was so bad. So good. Every time you do some sort of a business, there's always fits and starts. You go through.

[Ilana Golan]

There's going to be a lesson that comes with it, for sure.

[Tim Draper]

Yeah, there's always a lesson. Always try. It's always good to try things because you hit bumps in the road. And if you know how to deal with the bumps in the road, you can power through adding some crypto bumps in the road. And you just know that long term, this is the currency of the future. This is the store of value of the future.

[Ilana Golan]

And we'll definitely talk about it. And by the way, those are not on YouTube. You're missing out, because he is with a crypto like Ty. Like, this is so cool.

[Tim Draper]

Because what happens is all the other cryptocurrencies sort of contract, and then bitcoin rises up. Each time we have one of these boom busts. Bitcoin has a bigger and bigger market share of all the cryptocurrencies.

[Ilana Golan]

So we'll talk about all of this. Just one more question, because I think that's also a little rare in terms of your childhood. Before we move on, I think your high school wasn't at home. Right, Right.

[Tim Draper]

I went to prep school. I went to Andover, Massachusetts.

[Ilana Golan]

So talk me a little bit about what was that like, because that could be traumatizing, but it could also be.

[Tim Draper]

Well, for me, it was a great adventure. I had two older sisters, quite a bit older. They're three and four years older. And so I spent a lot of my time with the neighbors because they had three brothers. And so I was used to exploring and adventure, and my mom always encouraged me to go explore, and I think it was partly to get me out of the house because she was used to girls who kind of did it all the way they were supposed to, and I was trying things and breaking things, and I think I was a real shock to her system.

[Ilana Golan]

So it was easier to ship it. Yeah.

[Tim Draper]

And in fifth grade, I had a penchant for math. So in fifth grade, I was in algebra, but my school didn't have anything past algebra, So I had algebra for fifth grade, and then sixth grade and seventh grade. I really know algebra. And so shipping me off to Andover. Well, actually, it was kind of my decision, but they took me on the tours of these campuses, and. And it was kind of like, I think it's time for you to go kind of thing. And we knew that the math there would be much more exciting and interesting for me, and the adventure would be great. My parents had both grown up on the east coast and the culture on the West Coast. We were kind of the wild children. It was wild out here. I'm old. I'm 67. So when I was growing up here, that was more than 50 years ago. Silicon Valley, it was all orchards and.

[Ilana Golan]

Orchards. Yeah.

[Tim Draper]

And kind of wild. And there were no fences between houses, and it was just a. You'd always cut through the neighbor's backyard, and you did all that, and you had to watch out for gangs and the whole thing. So for me, Andover was an adventure. I went 3,000 miles away to high school when I was 13, and I think it was great. I definitely appreciate my mother because I did all my laundry and my.

[Ilana Golan]

You had to do it all on your own, so.

[Tim Draper]

Had to do it on my own. Had to go buy the toothpaste. And then Andover really piles on the work. So I was able to decide what I would really want to focus on, because I knew I wasn't going to be good at everything because the work was. Well, the work combined with the fact I'm living in a dorm and everybody's goofing off and socializing until about midnight. So it's like I've got from midnight till six in the morning to do all my homework.

[Ilana Golan]

Oh my God.

[Tim Draper]

And so I had to really cram. It was great.

[Ilana Golan]

We need to pause for a super brief break and while we do, take a moment and share this episode with every single person who may be inspired by this. Because this information can truly change your life and theirs. Now I want to check in with you. Yes, you Are you driven, but maybe feeling stuck in your career or a fraction of who you know you could be? Do you secretly feel you should have been further along in your income, influence or impact? Do you ever wonder how to create not just a paycheck, but the life you want with a paycheck? The thought leadership, the legacy, the freedom? Because that was me. And that's exactly why I created the Leap Academy program, which already changed the thousands of careers and lives. Look, getting intentional and strategic with your career is now more important than ever. The skills for success have changed. Aq, adaptability, reinventing and leaping are today the most important skills for the future of work. Building portfolio careers, multiple streams of income and ventures are no longer a nice to have. It's a must have. But no one is teaching this except for us in Leap Academy. So if you want more from your career in Life, go to leapacademy.com training check out this completely free training about ways to fast track your career and you'll even be able to book a completely free strategy call with my team. That's leapacademy.com training. Too many people finish their workday feeling frustrated, drained and unfulfilled. The good news is it doesn't have to be that way and you don't need necessarily a new job to fix it. Patrick Lenteoni, author of the Five Dysfunctions of a Team and more than a dozen other bestsellers, created the Working Genius assessment to help you pinpoint the kind of work that gives you energy and the kind that drains it. Over a million people, including myself, have taken it, and it completely changed how I lead and how I show up every day. So if you're a CEO or entrepreneur or someone who just wants to level up in business and in life, working genius will give you the clarity and the confidence to operate in your strength and really find greater joy in what you do. Because confidence isn't about pretending that you're good at everything. It's about knowing where you're truly gifted. So take the working genius assessment today. Get 20% off with a code [e-mail]. that's working genius.com. you'll be glad you did. And before venture capital, you also worked a little bit in, if I'm not mistaken, HP and investment banks and. And stuff like that. But you did decide at some point to step away from the good stack, or at least stable salary, and create your own venture firm, which was really rare in those days, right? That was like, not even a known word, I think. Tim, take me to those moments.

[Tim Draper]

Well, my grandfather was the first venture capitalist in the Silicon Valley. My dad was a pioneer of venture capital. And I don't know whether my grandfather did very well as a venture capitalist, but he was the first one. He did help finance the Bay Bridge, which is a really big deal. And I think Raytheon, he had something to do with getting Raytheon started. But my dad was a pioneer of venture capital. And I always explained to people in my class, they said, oh, my dad's a doctor or a fireman or a banker. Everybody knew what those were. And I said, my dad's a venture capitalist. And everybody look at me with a blank stare. And I say, he invests in small companies and he hopes they get bigger. That was it. So then, as I grew up, I kind of had a better feel for it. And I went to work for an investment bank. And my job was half investment banking, half venture capital. That was after business school. And I realized I kind of knew more about venture capital than the venture capitalist investment bankers did. And they were happy to get rid of me. It was a bear market. I was not a good investment banker. I didn't like standing in between a deal. It never felt good. I wanted to be on the team. I didn't want to be a referee. And so it was a good mutual parting. And my dad had started an SBIC that had no cash in it, but had some private companies. And the SBA was valuing at $2 million. And he said, well, why don't you go ahead and just do something with this? I said, okay. And I applied to borrow. I borrowed $6 million from the SBA.

[Ilana Golan]

I want to go there for a second, Tim. I want to go there for a second. Because again, even though your dad is like a venture capitalist and your grandfather, like, even though you came from the.

[Tim Draper]

He was in Washington. He was the chairman of the Export Import bank by then.

[Ilana Golan]

So taking 6 million loan is really, really scary at a young age. Take me there for a second, because I think our listeners, a big thing is holding it back is fear of money and taking loan and taking risks. So can you go there for a second?

[Tim Draper]

The good thing was I was putting at risk the $2 million, but I was not putting my life at risk. It wasn't a personal guarantee, which I would never recommend anybody sign. It was a guarantee against that $2 million. The SBA used to be very efficient. There were only four people that worked at the SBIC program. And I went through the whole thing with a guy and I applied. It was a very well organized thing because other people all did it by hand. I was able to do it on a computer, and so it was like, very impressive for them. And in the application, I showed the cash flows because as an investment banker, I learned how cash flows work. And I showed how it was going to work, and the guy was very impressed. But then he said, wait, there's something here that he's got a checklist. And he goes through the checklist, everything's fine. Then he goes, wait, you need 10 years of investing experience. And I said, oh, I've been investing since I was 10 years old. And he goes, check. And boom. There were a lot of interesting things that happened there. They lent me the first 2 million, and I started putting it to work. And for some reason, Wells Fargo, which made me feel like Wells Fargo may not be a good place to keep my money anymore, they sent me the $2 million twice, and I went, this is a mistake. You got to take this back. And they were lucky they found an honest guy because they sent me the first 2 million, and then they sent me another $2 million. So funn, I was thinking, wait, why do we have 4 million in the account? We're only supposed to have 2 million

[Ilana Golan]

and hardly even appreciative, like, just as $2 million. Like, let's go.

[Tim Draper]

Oh, never mind.

[Ilana Golan]

And by the way, for those who don't know the sbic, I think it's important is small business investment company. And it's basically like they give investment to fund small businesses, right? Basically, yeah.

[Tim Draper]

They lend to venture capital investors to put money to work. And it used to be just four people there, and they had about 600 SBIcs, now they have about 600 SBIcs, but there are about 1200 people there. And it's a mess. And you can only borrow one to one. You have to hire a lawyer to fill out all the forms. And It's a nightmare. It's one of those government things that just went off the rails and they should shut it down or restart it the way it was before.

[Ilana Golan]

So let me take you there for venture capital, though, Tim. Like, being a good entrepreneur or a knack to entrepreneurship does not necessarily mean being a good venture capitalist. In fact, I think sometimes they can actually clash a little bit because you can be starting to see things from the solution point of view versus the. Is the team really able to build this kind of thing? But you've been able to invest in some of the biggest companies in the world. Why do you think you've been able to do that? How do you decide if something is a crazy idea that's going to fail or a crazy idea that will change the world?

[Tim Draper]

Well, first, I work very hard to access as many entrepreneurs as I can. So that's where the school generates a bunch of entrepreneurs, brings them in from all over the world, 103 countries or whatever you just mentioned. The show is Meet the Drapers is reaching. Yeah. Reaches 300 million people. And so anybody who's running a business, they say, hey, why don't you talk to this guy? And then my venture business, I've had sort of the same email address forever. And that email address is a powerful force. It's about. I think probably today I may have gotten 20 or 30 business plans over email. And then we go proactively and we look through any article we read or any anything we go and we hunt them down. So a lot of it is you build your judgment by learning about what's out there, and you just try to make sure you're making the best investments. And I've made lots of mistakes, and most of my mistakes were errors of omission, not errors of judgment.

[Ilana Golan]

Tell me more. What does that mean? Because I know you're pretty public about it, like Google and Netflix. Like, you're pretty public. Yeah.

[Tim Draper]

Right? Yeah. I didn't fund Netflix because I thought that was nuts. I thought, we're about to be streaming. Why are you doing DVDs through the US mail? We can stream in about a year and a half. And he said, yeah, they're not ready for that yet. And I didn't really understand what he meant, but then I realized he's grabbing all the customers and then he's going to stream to them and Netflix, big one to lose. And then some. I can blame partners for or whatever. But what's great is we saw all those deals, we got outbid on Facebook. We had six Search engines. Before we saw Google, we saw them all. A lot of that is because I get out, I speak, I give people my email address.

[Ilana Golan]

That's how I started. You're the most approachable person I met when I started on and I think that's a big thing.

[Tim Draper]

I say yes to podcasts.

[Ilana Golan]

See, let's go, Tim.

[Tim Draper]

There may be some entrepreneur out there listening right now and they say, hey, I'm going to start a business and here's the guy.

[Ilana Golan]

Well, Tim is the guy and we'll talk about this because I think another element, Tim, is not just knowing what to invest in. And I think you also, your advice means a lot. Like, I want to take you, if that's okay, to the Hotmail days. Some people will not remember, but Hotmail literally changed the world and you actually helped. I think the founders give it for free.

[Tim Draper]

They said, hey, now we can do it. We have just funded them. And it was the first board meeting and they said, now, hey, it's up it goes. And I said, what's up? And I didn't know what they were talking about. They said, no, you can email now, it's web based and these emails cost us a fraction of a penny to send and we're thinking of giving it away for free. And I said, okay, you're giving it away for free. Well, how are you going to get the word out? So everybody's doing it. And they said, oh, TV ads and whatever else. And I said, we sent you enough money for a nanosecond of airtime on tv. That is not going to flank. Let's just get it out to that Internet thing that was mostly military at the time. And they said, oh no, that would be spamming. And I thought, okay, no spamming. Then I said, well, what if you put a little message at the bottom of everybody's email that says, P.S. i love you, get your free email at Hotmail. And they looked at me like, what are you thinking? I said, no, because then I send an email to you, you send it to your friends, they send it, their friends, they send it, and everybody can just click a link and then start emailing. And it took them a while and they finally came around and they said, okay, but no PS, I love you. Now. It would have been a more peaceful and loving world if we had done the P.S. i love you. But they did do get your free email at Hotmail and it spread to 11 million users in 18 months. Fastest growing consumer product in the history of the world. To that date, there have been Faster ones now. And one of the founders was Indian and he sent an email to his friends in India. And within three weeks we had a hundred thousand registered Hotmail users from India. All of a sudden we realized the world just opened up. We can communicate with anybody. You know what it used to be like, you would cut down trees, send

[Ilana Golan]

a mail, wait two weeks, lick poison,

[Tim Draper]

wait two weeks, and maybe something would come back and maybe not. And all of a sudden it's real time. You send an email and you get a response within minutes. And all of a sudden, wow, all of a sudden we can do trade with India like that. That was just major breakthrough. And the world became wealthier just that day. And so we're really happy and pleased that we did that. And because of the serendipity and synergy we created, we're all very proud of Hotmail. That was really extraordinary. That's where Gmail and every, all the other mail came from.

[Ilana Golan]

Everything started there. Yeah, I mean, I was still in the Hotmail days. Like, I think some people don't know it, but that was like, I'm still in the Hotmail days. But. So, Tim, what other stories kind of sit in your head and make you feel like, wow, this made a really, really big difference?

[Tim Draper]

Well, Skype similarly had a viral effect. They put get Skype or whatever, and if you were a Skype user, your phone calls would be free, unless you were calling to somebody with a landline. And it was landlines at the time. Not too many cell phones. There might have been a few in cars. So Skype took off. There were 3 million Skype users at this point that I'm talking about. And they were all audio and everything was great because the long distance carriers used to charge about $8aminute for any conversation that crossed a border across to any kind of government border. So if you called England, you paid five bucks a minute. If you called Africa, you pay $85aminute.

[Ilana Golan]

Oh, I called Israel all the time. Or the US and it was crazy, for sure. Yeah, I remember it. Yeah.

[Tim Draper]

And suddenly it's happening for free. The world is just opening up. And I said to Nicholas Zenstrom, hey, I got a problem. I'm supposed to be in Palo Alto at the same time as our board meeting in Tallinn. Can you get video conference equipment in Tallinn? I mean, does anybody have any? And they said, oh, yeah, we got that, it's fine, we'll figure it out. And so I flew to Tallinn. I had to be at a conference in Palo Alto, but I flew to Tallinn. We had our board meeting. Oh. And the guy, Tony Perkins, who put the conference on, said, yeah, happy to have you beam in, but that was risky because you never know what. We had a backup for a phone line. That's what we were kind of doing. And he said, but will you interview Nicholas? Because that thing at Skype seems to be taking off Skyper. I think it was still called Skyper. And I said, sounds great. And Nicholas was happy to do it. And so I sat down with Nicholas. My daughter was there. It was take your daughter to work month. We got on the call, and it worked so beautifully. I asked Tony, how did it go? Oh, it was fantastic. We could hear you, see the pores on your skin. It was fantastic. It was perfect. Came through perfectly. And Nicholas is laughing, and I'm saying, what are you laughing about? He goes, that was the first Skype video ever.

[Ilana Golan]

Oh, my God.

[Tim Draper]

And I said, what? We're going to have video? And he starts laughing. He goes, yeah, we're going to video. And I said, well, that's fantastic. We got a winner here. And he goes, oh, no, not so fast, Tim. We had to cut off 100,000 simultaneous phone calls in order to get the bandwidth to do the video. So, you know, entrepreneurs will do whatever it takes, but Skype has led the way for, you know, Zoom or whatever, this is Riverside, so that we can be. I don't know where you are. If you're in Israel, then terrific.

[Ilana Golan]

I'm close by to you. I'm in Los Altos, but I'm really close by to you.

[Tim Draper]

I don't know where anybody is, but you get to see them on Skype.

[Ilana Golan]

That's what's beautiful. And my husband was actually in Skype, so my husband was in Skype as an engineer at some point.

[Tim Draper]

Great. Did he live in Estonia? That was a big part of Skype.

[Ilana Golan]

No, but he was visiting. He was running an engineering team, so some of them were in Estonia. So, yeah, he would fly a lot. So trim. But somebody looks at you and you're going to. We'll talk about it. Because you continue to reinvent yourself, and I find that fascinating. But if somebody looks at you, it's like, okay, so it's super easy for Tim. He never has hard moments. He's just like this epiphany of success. Are there hard moments, or can you share some hard moments to make people feel like, okay, I'm not alone on the journey.

[Tim Draper]

When I first borrowed that money, I put it to work, and three years later, they were calling my loan And I said, you can't call my loan. I haven't missed a payment and whatever. And they said, no, you're on our dirt list. And I said, okay, wait. And I flew back to Washington. I convinced them not to call my loan. So then two years later, we had five IPOs in one year. And so I went from being on their dirt list to being the venture capitalist of the year in this two year period after the dot com thing, we were the center of all activity there. We were booming with dot com. We were the number one venture firm in the world. We were the top of the top. And we had one fund where we invested in 23 companies and 19 of them went public. We invested them as startups and 19 of them went public. Then the dot com market just fell under our feet and everything dropped 95%. And all these investors who we were making all this money from before came. And I felt like I was on a firing line. And we just kind of faced the music and said, hey, yeah, this didn't go the way we had intended. And then the government made it drag out even longer than it should have because they created Sarbanes Oxley so you couldn't take anything public anymore. Overregulating and always at the wrong time. They always get it wrong for some reason. And so, because I think that would have bounced back, it was a crash and there was going to be a crash and we had to come to terms with the fact that companies had to make money. It couldn't be just eyeballs.

[Ilana Golan]

Tim, how do you manage this personally for a second? Let me take you there personally. You need to go through this. You need to navigate your firm. You need to help the startups that are probably freaking out. Like people are pulling money. Like, how do you sleep at night? Take me there for a second. Because there's a lot of stress. And I want the listeners to hear that because I think sometimes we don't even realize that everybody's going through some really, really, really hard moments. I think the only question is, how do you navigate it?

[Tim Draper]

I always take life as an adventure. You know, I played chess a lot with my dad when I was growing up. And you've got this plan, you got it all figured out, and you know exactly how you're going to checkmate him and then he does something unexpected and you go, oh, how did I lose my queen? And then you got to rethink, how can I beat him with no queen? And I think that helped me a lot because as I go through life, it's a bit of an adventure. I like to look at it as an adventure. You know, it's going to be fun and it's going to be hard, and it's going to be whatever. I always try to. And I don't know if I do it all the time, but I always try to do the hardest thing I'm going to do that day first. Get that done, get it out of the way. What do I have to do that I've just, God, do I have to fire that guy? It's like that. Do that first. First of all, the guy you're firing is probably feeling better because the day is young instead of the end of the day. But you get the hard thing done first, and then the rest of the day is a little easier. And even during a very difficult time, it is easier if you get the hardest thing done first. Now, I just thought of another time when it was a difficult time for us, and that was a frivolous lawsuit. It was just, oh, can't go through. I'm not allowed to, by the way. That's the way the lawyers always settle it. They always go, oh, yeah. First of all, they always settle exactly at the limit of the insurance company, and they always settle and make sure that you can't come back after the lawyers for bringing the frivolous lawsuit. But when you're sued, all of a sudden you look and you start thinking about what the downside is. It's good to know what it is. But that should just be your baseline from which you can make all the good things happen. And I think that my worst decisions were all made out of fear, and my best decisions were made where I go, God, what if this works? So when I did something out of fear, first, I always was mad at myself. And then the other thing I noticed is that if I'm not swimming upstream, if I'm not really trying, if I'm not doing the hard things and I'm just kind of coasting with the crowd, I don't feel good. There's something in my gut that says, you're not making any kind of a difference right now, and you're just living it up. And I tend not to like to live it up much. I like to think, okay, what's out there? What's wrong? What could be improved? And how can I go after it? And if I go after it, then I'm always happy. It's like, okay. And, you know, when there's a crash in a market or bear market or whatever, that's When I get the toughest. So going gets tough. The tough get going. And when things are really hot and everybody thinks that you're right and everything worked out and all that stuff, it makes me really nervous. I go, God, something must be wrong because I'm never right. I'm always the one shaking it up. I remember when the politicians are. Politicians are always like, right in the middle of the bell curve. A good politician just sits there and goes, okay, which side of the absolute middle of the bell curve is where the parade is going to be? And that's where I'm going to be. So they're just like the most safe. They make the most safe decisions, except for Trump, but they make these safe decisions. And when I start feeling like I'm in that, like, that's a problem for you. Big majority. It's like, what? Wait, no, so I gotta go work on something else. And if everybody thinks whatever, AI is the.

[Ilana Golan]

Yeah. What about now? Yeah, now is a great example. I mean, there's AI, there's future work, there's so many changes. Obviously, you're passionate about crypto. Crypto. And you're such an evangelist for it.

[Tim Draper]

AI might play out similarly to the dot com thing. I think you're going to see a dip. May not be as bad. I mean, that Sarbanes Oxley was the stupidest thing. It's like, okay, let's kick the horse when it's down. You know, it's a dead horse. Let's kick it when it's down. Let's not let anybody ever go public again. So hopefully they will have learned from their mistakes. And if there's a dip in the AI market, because there's such.

[Ilana Golan]

It is booming. Yeah, yeah.

[Tim Draper]

It's dipping today a little. But if there's a dip, then I think the recovery, it'll be a little smoother. But I also believe the upside is higher than any of us ever imagine. Right now, same thing. It goes the same way as the Internet. Internet went up and then down. And then the upside was much bigger than anybody imagined. Google, Facebook, whatever, all those things became so big. And same thing with Bitcoin. It's been up, it comes down, and then at some point it's just going to grow, grow, grow, grow, grow, and eventually maybe be our. The biggest global currency in the world. And then now that's happening with AI, you're seeing it up there and then it's starting to falter, and then it'll fall a little, and then it'll be bigger than anybody ever imagined. And it'll just be a part of our lives. In fact, it is a part of my life now.

[Ilana Golan]

You continue to reinvent yourself again, again, again. And you have the. Like you said, the Draper tv. Meet the Draper tv. And you have, you know, like, all the things that you're involved with. For people who are listening to this, Tim, and wondering, like, what's next for me? How do I find what's next? Maybe they already been kind of on that executive level and trying to figure out what's after that. Or maybe they're debating about entrepreneurship, or maybe they tried entrepreneurship, it didn't really work out, and now they're like, what's next? Like, what would you say to them? Like, what would be your advice to somebody listening?

[Tim Draper]

I was looking at these two images, and one was the brain. And it looks like those hoses that are compressed, and it goes back and forth and back and forth in, like, an S, a couple of S's. And then on the other side, same thing. And then I looked at a gut and I saw the same thing. And I started to talk to a bunch of scientists, and they said, yeah, we believe that there is some connection between the gut and the brain.

[Ilana Golan]

Okay, so my answer is maybe that's why I eat all the time.

[Tim Draper]

Okay, well, my answer to you is, listen to your gut. Listen carefully to your gut. Some people get very cerebral about stuff like this, but your gut is the thing that is like, operating your. You know, the food, the brain, the pooper, you know, the whole thing. And it's sending messages to your brain. It understands things that your brain may not know. Follow your gut, and it will find the place that you should be. Also, operate not on fear, but let's

[Ilana Golan]

go there for a second. You're afraid of people hating you or judging you, or what will society say? And what if I lose my money? And what if my wife thinks I'm a loser? Whatever. Like, there's all these things that are coming your way. How do you still listen to the gut? And how do you still take action despite the fear? What works for you, Tim?

[Tim Draper]

So if those voices are bigger in your head than the opportunity, then you should not be an entrepreneur. If you say, look, I'm willing to put up with this for three, five years before people recognize that I've got a really interesting service or product that I can provide to the world, then you can do it. If you're spending most of your time worrying about what other people think, most people aren't really thinking about the future. You're Trying to create. They're thinking about what's the world look like right now. In fact, I mean, the news, it's all about what's going on right now. There's very little speculation on what could happen in the Future. Go out 15 years, you're going to be flying around in flying cars, maybe all electric. You'll be able to go to Tokyo in an hour and a half from San Francisco. There will be people sitting around on Mars or on the moon. I think all of our images are probably going to be in multi dimension, so this zoom call will look very antiquated. Instead, we'll be in 3D form and everything will be beautiful. Oh, they're going to probably cure death. I mean, they'll probably eradicate cancer. I think we're going from what used to be chemo, chemical therapies which would cure, not cure anything, but kind of put it off, to bio cures, gene editing and cloning and stem cells and all that stuff. Medicine's taking on a whole new form now. So 15 years from now, we're going to be looking at things in a whole new way. But in the press, I mean, it's like what is happening today. One thing I would like the press to do more of is to celebrate our heroes, celebrate Elon Musk, celebrate Jeff Bezos and Larry Ellison and Mark Zuckerberg. Those people are extraordinary and what they've done is extraordinary. And it worked. I mean, a lot of people do entrepreneurial stuff and it doesn't work. They move the ball along, they're good for society. I mean, there were plenty of things before Facebook, MySpace and Friendster and whatever else. Those people all helped make this thing happen. But it happened. And these people were the big successes. And I think they should be celebrated like Taylor Swift or the great athletes of the world because they really have done something extraordinary. And I can push a couple of buttons and I get a toothbrush in four hours.

[Ilana Golan]

Right? That's incredible.

[Tim Draper]

Yeah, I can have a party and I just say, oh, okay. How many people are we going to have? About 10. Push a button and all the food shows up, stuff and balloons and whatever else I need. It is amazing what these people have done for us and we should appreciate it. And the schadenfreude that spreads through the media and politics is really hurting society. Because think of it from the eyes of a 10 year old. If they look and they see Taylor Swift and everybody celebrates her and everybody loves her, that's what they want to do. Great, be a rock star. Then they go and they look at Elon Musk and they see all this negative stuff about him in the press and they say, oh, don't be a

[Ilana Golan]

big successful business person because then you're in the light.

[Tim Draper]

Not in the light, are you kidding? It's all dark, it's shade. They need to be celebrated. So that 10 year old boy girl says, I'm going to be better than that guy. I'm going to be bigger and better than that guy. I'm going to do something even cooler than what he's done. When you pick on somebody, I mean, I guess there's something in our spirits that says if you take somebody else down, it makes you look better. I don't actually think it does. But instead, if you spent the same amount of time building them up, think of all the 10 year olds that would be inspired to reach greater heights and do greater things for the world. It's something that's kind of gotten messed up here in the us. It used to be that used to be what the American dream was all about. It's like, oh God, I'm going to be like that. I'm going to have a house, I'm going to have a car, I'm going to have a tv. This is going to be awesome. And now it's like, ew, he's too successful. I look at that and I go, oh, are you kidding me? I would so much rather Elon Musk put a billion dollars to work than any politician who won a popularity contest. You win a popularity contest, so then all of a sudden you're responsible for hundreds of billions of dollars. Makes no sense. You build something from the ground up and it becomes worth a trillion dollars. You build bet you can be responsible for that.

[Ilana Golan]

You shed some super interesting points. Elon Musk used to be a role model for everybody and I think something went sideways a little bit.

[Tim Draper]

But yeah, they were looking for things to pick on.

[Ilana Golan]

But I absolutely agree that we all

[Tim Draper]

celebrate, we all do different things and sometimes it works.

[Ilana Golan]

We need to celebrate the successes.

[Tim Draper]

Definitely. I think Elon has maybe just hit a trillionaire. I am going to be so excited. That should be a day for Americans to celebrate the fact that America has what, 10 of the $11 trillion companies and the Silicon Valley has seven of them? I think that is something to say, Whoa, baby. This is awesome. This is what we want. We want the billion dollar company in Europe. They're going, I don't think we wine and cheese generation. I want to just sit here and be a lazy socialist

[Ilana Golan]

so Tim, I knew you're going to make me laugh. So how do people get on your show or how do people reach you?

[Tim Draper]

Well, we get about 1,000 applicants for every four that go on the show. And then we have 10 shows season and then we have semifinals. Two semifinals and one finale. I guess you go to meet the drapers.com. there must be something there that tells you how to do it. And then if you want to apply to Draper University, it's really extraordinary. It's a five week program. We take you through everything from a Heroathon to survival training with Navy seals. You got two minutes with a panel of venture capitalists and we really shake you up.

[Ilana Golan]

It sounds like my military days. Sounds amazing.

[Tim Draper]

Yeah, it's a little like that.

[Ilana Golan]

Sounds amazing. Tim, last words. If somebody's listening to that and just they're super inspired by what you created, they do want to create something big in their life. Maybe it's not the SpaceX of the world, but they do want to create something with more meaning, impact, et cetera. What would you tell them?

[Tim Draper]

Well, first they should listen to your podcast, but then beyond that, try it, take a step, see what happens. And then you may have to take two steps back before you take another step. But take a step, try it. You learn so much when you try things. At least I do. I mean some people can just do, read it and intellectualize it. I actually have to do things. If I do things, I learn probably more than I want to learn.

[Ilana Golan]

It's never been easier to experiment things than it is now.

[Tim Draper]

Yeah. Oh, I know, I know. There's plenty of venture capital out there. There's people encourage people to try things, they see great success so that they at least in the backs of their minds they can say, hey, you know, that may work. You know, if it works, I'm going to be big deal.

[Ilana Golan]

Tim, thank you for coming on the show and making it fun and inspiring and continue to build these amazing mega successes. The young generation with the university, but also the unicorns because they changed the world. So thank you for all you do well. I hope you really, really enjoyed the conversation. Do share this with anybody that is a founder, want to be a founder or somebody trying to figure out what's next for them or how do I pass a fear like this was so good. And think about it like your mind, your gut, they all look the same, like how incredible that is. I remember that every week we choose a question you asked us on our YouTube channel. So I do have a beautiful question from Jordan who is asking, how do I know what to invest in and how to use my time? And I was thinking about it because, again, like, this is such a big answer. And I wanted to keep it, like, contained. So the best thing to look at is continuously to look at roi, right? Return on investment. What is the biggest value that I have here? And one of the stories that I heard, and I don't know if it's a myth or it's true, but I love the story. So in the Stanford Business School, they gave the students a task. And the task was very simple. It was basically like, we're going to give you $5 in two weeks to make the most money that you can, and then you're going to present your strategy before the students to the group. So basically, most of the people, what they did and take a pause for a second and think what you would have done, right, $5, two weeks to make the most amount of money, and then you get a chance to present it to the group. So most of the people, what they've done is they took it as is, right? They took the five doll, they bought as many cheap stuff as they could, they sold it for as much as they could, and they basically made anywhere between $10, $20. Again, I don't know the exact stats, but this is kind of the story and I think the moral is fantastic. So. So they made somewhere around, you know, 2x4x whatever it is, right? A small group of founders, what they've done is they actually ignored the $5. They were like, this is noise in the system. The $5 is a noise in the system. I actually have two weeks to sell services to students. So in that case, they started offering car washing services and babysitting and all sorts of things, and they made a few hundreds of dollars. And that was fantastic. The last group, and this was like only just a handful of people that realized that most of these things are actually just noise in the system. And I want you to do this also for your own business or for your own job or for your own life. They really thought of like, what is the biggest return on investment that I have here? Or the what is the most value? And the most value is the time with the students, that 30 minutes that they get received in order to strategize and give the presentation to the students. This is the piece that is most valued. So if they have access to companies that want access to Stanford students, that's where the value is. So they ignored the $5. They basically ignored the two weeks or whatever. And they reached out to any company that actually wants to reach Stanford students and they gave them time to talk to these students. So they basically took that 30 minutes, they cut it to several time slots and they gave them time in front of the Stanford students. They made thousands of dollars. So the reason they were able to make thousands of dollars versus 10 or 20 is because they decided to not be limited by money or time or whatever, but they really thought about what is the most amount of value that they can actually provide and how do I create it. So what I want you to think about is what is noise in the system right now and where is the most amount of value that you can provide as an individual, your company can provide as a company and how can I focus on that? So I hope this helps you again. Remember, share it with anybody that you can leave a five star review. It means the World. If you do have questions, put it on the YouTube channel and I can't wait to see you on the Leap Academy show with Lana Golan. Love you all.

[Tim Draper]

Foreign.

[Ilana Golan]

Remember, this episode is not just for you and me. You never know whose life you're meant to change by sharing this episode with them. And if you love today's episode, please click the subscribe or Download button for the show and give it a five star review. This really means the World. Join me in helping tens of millions of individuals reinvent their career and leap into their full potential. Look, getting intentional and strategic with your career is now more important than ever. The skills for success have changed. Aq adaptability, reinventing and leaping are today the most important skills for the future of work. Building portfolio careers, multiple streams of income and ventures are no longer a nice to have. It's a must have. But no one is teaching this except for us in Leap Academy. So if you want more from your career in life, go to leapacademy. Com Training Check out our completely free training about ways to fast track your career. You'll even be able to book a completely free career strategy call with my team. So go to leapacademy. Com Training.