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- [00:00]
A
I was sitting. I started my first company, Tough Strategies, in 2010. It's a political consulting firm that runs big legislative and policy campaigns all over the US and I was sitting in a meeting in early 2011, and a friend of mine called and said, hey, there's a guy with a small transportation startup. He's having some regulatory problems. Would you mind talking to him? I become Uber's first political advisor that day. And then when Travis Callana called me back, Travis was the founder and CEO. He said, listen, I can't afford your fee. Would you take equity? I didn't know what equity meant, but for some reason, I just heard myself saying yes. And that meant I started getting stock in Uber very, very early on. But more important, it meant that it became my job to legalize Uber in New York and in markets all over the US Olivia loves a challenge. It's why she lifts heavy weights and likes complicated recipes. But for booking her trip to Paris, Olivia chose the easy way with Expedia, she bundled her flight with a hotel to save more. Of course, she still climbed all 674 steps to the top of the Eiffel Tower. You were made to take the easy route. We were made to easily package your trip. Expedia made to travel flight. Inclusive packages are atoll protected.
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B
Bradley Tusk, thanks for coming on and talking to us today.
- [01:22]
A
Yeah, hey, Brian, thanks for having me.
- [01:24]
B
So we're going to talk about your career. And as a lot of people know, the whole point of your career is this sort of, like, intersection between tech and politics and governance. But if I made you say, what is your true love? Is it politics or is it technology?
- [01:40]
A
Oh, it's definitely politics, for sure.
- [01:44]
B
That came first, right?
- [01:45]
A
Yeah. And I think I'm kind of more. More of a political junkie than attack junkie, for sure. But the funny thing I've noticed, though, is that people who work in politics now see me as, like, a tech and business guy, and people who work in tech see me as a political guy, so. So whatever you are, you assume I'm the opposite.
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B
Or we assume that you're on our team, I guess is the way.
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A
Or maybe not.
- [02:08]
B
Actually, that's true, I suppose. But you did. You went to school. Penn Chicago Law. What did you think your career was gonna be, Paul?
- [02:21]
A
Well, so when I was in college, I was actually in the creative writing program, but at the same time, I had worked for the mayor of Philadelphia, Ed Rendell, all through. And so I kind of hit that point towards the end where I'm like, okay, I Could probably pursue a career in either of these. And I really liked both a lot. And my thought process was I was a pretty good writer, but, like, my ceiling would have been like a showrunner on a sitcom. I probably would have done just fine doing that, but that was my ceiling. I wasn't going to win the Pulitzer Prize. I wasn't going the National Book Award. Whereas the politics, I felt like, who knows what I could do? And so I pursued that instead. And I got incredibly lucky that the things I did in politics were interesting enough that I ended up being able to write a couple of books anyway. But definitely politics.
- [03:13]
B
What brought you to New York City?
- [03:16]
A
Well, I grew up in Brooklyn and Long island and then came back after college, came back again after law school. And other than four very crazy years back in Chicago as the deputy governor of Illinois, I've really been in New York the whole time. And when you talk about sort of true loves, what I really love is New York City politics even more than state or federal.
- [03:36]
B
You got your start at the Parks Department here, right?
- [03:39]
A
I did. I did.
- [03:39]
B
Under the legendary Henry Stern.
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A
Star Quest.
- [03:42]
B
Yep, yep. So that first job, was that, like, a real education in terms of how, like, municipal politics works?
- [03:52]
A
It was how municipality government works, I would say. So in the sense that Henry was appointed. He had been an elected official, city councilmember earlier in his career. I got an incredible education from Henry as to how city government works, how the levers of power work, how to get things done, even kind of around the system, as opposed to sort of working through the bureaucracy. You know what was incredible about Henry that was both wildly irresponsible and yet wildly effective was he just hired all these young people from these really good schools, paid us 22 grand a year, and said, okay, go run whatever at the Parks Department. And the good news is he got really talented people for very little money, working 80 hours a week. He definitely violated all kinds of civil service rules along the way, and the city ended up paying a big fine because of it. But I got a great education in what makes people tick. And the thing that I really realized was I was Henry's spokesperson is Henry was like most politicians, which is he desperately, desperately needed as much affirmation and validation as he could possibly get. And seeing his face on tv, reading his name in the newspaper is what provided it. And so because I was this press guy and I was pretty good at it, it gave me a sense of, like, one, okay, here's the kind of power and influence that I could have with this skill set. But two, here's what make these guys tick.
- [05:20]
B
Is there. What years was that at the park?
- [05:23]
A
Was two stints. It was sort of 95 to late 96 and then again like 98, 99 or something like that.
- [05:31]
B
Late 90s. So this is sort of when was there, like a sense of energy coming back to the city? One of the reasons we're Talking is the 30th anniversary of what is known as Silicon Alley. Just give me a sense of what the city was like at that time and maybe around.
- [05:48]
A
I'll give two different ways to answer that question. So the first is, yeah, look, I was, you know, early 20s, so I think I probably had, you know, I would have had a ton of energy in any scenario. But you combine that with New York, where we had a. A job where the commissioner worked 24 7, literally. And there's stuff that happens in the parks 24 7. Right. And so, like, I was working probably a solid 80 hours a week, but also I was young and in New York City, and I was going out till three in the morning and sleeping very, very little. And I was at the age where I had the energy to burn the candle on both ends. And then from a city governance standpoint, Rudy, while he ultimately sort of lost his mind, he did some really innovative things in government. And so, you know, being part of some of those things and that experimentation was really exciting and it felt really meaningful. And then right around the same time, you had the kind of emergence of the dot com era in New York City. I think my first exposure to, I don't remember this was cosmo.com.
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B
Yep.
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A
And it was like they would deliver you anything, and it was effectively, like, free. Like, you didn't have to pay, you couldn't tip them. It would cost like, half of what it normally would.
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B
It could be a stick of gum and there's no delivery fe.
- [07:12]
A
Yeah. And I remember being like, this is amazing. How does this work as a business? And of course, the answer was it didn't. The guy named Matt Higgins, who's since become a successful tech guy and a judge on Shark Tank, but was in Rudy's press office, went to Cosmo. He was the first person I knew that went into the startup world, and he's done really well.
- [07:31]
B
I just spoke to Josh Harris of sudo.com fame. And so we were talking a lot about, like, again, the. The money coming in, the parties downtown, the art scene, but also like the tech scene. And like, was there a sense at the time that New York City was becoming a tech hub. I don't know that we even had a sense of tech hubs at that point. But do you remember tech energy coming in city?
- [07:58]
A
I could tell that there was something happening. And to me, where the two really coalesce was, fast forward a few years when Mike Bloomberg became mayor, because then all of a sudden you had the organic tech scene and industry develop in New York City, along with a mayor who came from tech is a trained engineer and identified, hey, one of the things I want to try to get done in my time here is to diversify the city's economy. And to him it was very clear that that other sector should be the tech sector. And so he started actively really pursuing it and saying, okay, I want to make this a thing. So then you had the marriage of something happening already, market allowed for it, and then the government with all its resources saying, we love this, we want to really grow it. And that's when I think all the fuel was added to the fire.
- [08:48]
B
I'm going to jump around just a little bit, but let's move on to working with Senator Schumer, who is literally a couple blocks away from me right now.
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A
But.
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B
What did you learn by moving on to Washington in terms of things like, I don't know, messaging and like management of policy and stuff like that?
- [09:11]
A
Yeah, I mean, really what I learned in working for Chuck, and look, it was an incredible learning experience. It was a two year PhD effectively in how media works, how politicians work, how they think, what motivates them. And Chuck was sort of Henry Stern times a million. And Chuck was easily at the time the most sort of media friendly and hungry member of Congress. My guess is at this point, now, maybe some people surpassed him. But. So we just did vast amounts of press for Chuck every single day, of course, culminating every week with his famous Sunday press conference. I think in the 104 Sundays that I worked for him, I got one off for my wedding and one for my honeymoon. And I did press conferences the other 102. And what I realized was, one, if you could come up with clever ideas, people would cover it, talk about it. You know, the press sort of had its need to sort of deliver somewhat entertaining content that seemed important. And at the same time, with Chuck, if I could come up with ideas that would get him attention, that became the legislative agenda, because the thing that he cared about the most was getting on tv, getting his name in the newspaper, and because I became the person who could like, think of stuff that the press would then want to talk about. And cover effectively if every Sunday plus the rest of the week you have to announce something that effectively becomes your agenda. At the same time, I don't think we passed a single bill in the two years that I was there. It almost felt besides the point. The point was this kabuki theater of which we worked incredibly hard at it, and it felt important. But in reality, if not for 9 11, I don't know that a single thing that I did in the 24 months I was there had any real world impact whatsoever. But 911 did happen about almost exactly halfway into my tenure there. And that became a point where one, the people just really needed to see their leaders and elected officials out and about and on the case as much as possible. I wonder if in today's world that would be the same. But it was the case then. And two, I remember we were trying to get $20 billion in funding for New York, which is such a. It's almost cute now because it's like you get after there's like a fire and then for reimbursement. But at the time it was sort of the biggest amount that had been given. So getting all of that and some of the subsequent 911 related legislation through Congress was really a big deal.
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B
I'm kind of alighting over this, but Deputy governor of Illinois, are you learning things about legislation and budget and stuff like that?
- [11:53]
A
Yeah, for sure, because I'm running all of it. So, you know, I'm 29 years old. I'm sitting at this point, I'm working at City hall for Mike Bloomberg. We all sit in a bullpen with Mike in the meadow. And I'm sitting in the bullpen and my phone rings and it's a guy I knew from Washington. And he said, hey, do you want to be the deputy governor of Illinois? I said, what's a deputy governor and why are you calling me? And the answer was it's the person that runs the state. And insanely enough, I got this job where. And by the way, there's just one deputy governor. It's like in New York City there's like seven deputy mayors at any given time. So I was in charge of the state's budget, operations, legislation, policy and communications. And that meant every dollar, every employee, every policy, every program, every everything. And of course a logical person might be wondering, why would you give a 29 year old from New York that much responsibility, especially in a place where he really didn't even know. And I think it was a mix of a few things. I think the governor Was a guy named Rod Blagojevich, who certainly made himself famous later. And he was so crazy that they understood that they needed someone really young who would view this as a career making opportunity and would put up with any of his sort of nonsense to be able to have that job. And I did. But I got there, and I remember my first day being told, okay, there's a $4.8 billion budget deficit. Figure out what to do about it. And working with the budget director, a lot of people around the clock, Rod gave us some broad dictates, which was, I don't want to raise taxes, I don't want to cut funding for schools or health care or public safety, but make the budget deficit go away. And that certainly meant we had to be pretty creative. But really, I spent a good chunk of my time over the next four years figuring out what the budget should be, how to pass it, how to legislate it, negotiating it with the speaker and the senate majority leader, and the same thing with the policy agenda. And Rod was a very, let's call it, absentee governor. Rod had this view of politics that was both completely insane and yet also wildly logical, which was the job of running for office and the job of holding office were two totally different jobs. And his job was running for office. And he genuinely believed that by winning, he did his job. He's like, I'll see you again in four years. And that meant he had virtually no role whatsoever in the actual governance. So, you know, for the state of the state, which would be the speech he would give that would lay out all of our legislative priorities for the session. I'd write the speech, we'd figure out what we wanted to do, I'd write the speech, I'd hand to him and say, hey, you're going to deliver this off the teleprompter to the legislature on Tuesday. And he would do so brilliantly, by the way, and wildly talented guy, and then go back to Chicago and watch cubs games and exercise and do all the stuff that he liked to do. And it was my job to try to pass all these bills and run the state. So, yeah, it was an incredible learning experience. It was not easy because Rod was not an easy person. And luckily, I never really got caught up in his corruption stuff. But he did once slip up and asked me to do something illegal. And fortunately, I knew not to do it and reported it, so I didn't get in any trouble. But as a result, I did have to testify against him on his trial.
- [15:02]
B
Well, coming right off of that this is probably the wrong way to phrase it, but was that the job that taught you how the sausage was made in terms of legislation and government?
- [15:11]
A
Yeah, for sure. Because I think in the Senate, it was so performative that it just. There wasn't that much sausage made. And to the extent that it was, Chuck at that point was a very junior senator and wasn't really part of it. Now, of course, he is the sausage maker. And, you know, in the Bloomberg world, the stuff that I did definitely gave me some sense of it. So, like, I ran the city's Charter Revision Commission, and I had to both get the process done and then run the campaign that won to change the city charter. So I learned parts there. But, yeah, I learned more in Illinois about how politics work and really about how people work than anything I've ever done.
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B
So I told you we're going to jump around. I will come back to going into finance, but let's jump to the Bloomberg 2009 campaign, because I think that'll get us into Tusk Strategies.
- [16:00]
A
Yeah. By the way, the Lehman blip was pretty uninteresting, so feel free to skip it if you want. Like.
- [16:06]
B
Well, okay.
- [16:06]
A
I don't think in my memoir I even covered it.
- [16:09]
B
Oh, okay. Well, I was just curious if that was seeing the other side of the table. But let's go past it, and let's go straight to the Bloomberg campaign. And again, I want you to frame it for me in the sense of the city. And this is, you know, the teeth of the great financial crisis. But also, and for the purposes of this podcast, tech didn't really. Tech came through it winningly, and tech is about to enter its glory years. So give me a sense of what that was like, The Bloomberg and 2009, New York City.
- [16:44]
A
Yeah. So after Illinois, I had this idea about privatizing state lotteries and took a job on Wall street to try to do that, and in my great wisdom, picked Lehman Brothers. And Lehman Brothers, as everyone knows, both crashed and burned and took down the global economy with it. And the day that that happened, I get a call from Mike saying, I need to see you. And I remember he's saying, well, what are you doing now? And I said, nothing. And he goes, I know. And he goes, well, I feel like I need to run for a third term because the city is now in the middle of this massive fiscal crisis and economic crisis, and so I need to do it, but I need the counsel to allow me to run for a third term. So you're now the person in charge of passing a law to change that. So that became sort of my immediate job. It was a hard process, but we won. Very controversial. Definitely made our margin a lot smaller in the subsequent election, but we did. And then I ran his mayoral campaign. And it was obviously a difficult time in the country, in a way, but it was also a really exciting time in the country, too, because like you said, the tech sector, it was taking off in New York City, Even if it took a couple of years for the economy to feel it, you could see the seeds of it happening. Obama took office, and there was a lot of excitement around that. And what's interesting was there because it was the Mike Bloomberg campaign, which meant a. He's a tech guy. If you asked him the question, politics or tech, he would say, tech. Right? He's a tech guy. Through or through. And we also just had unlimited resources. I remember, like, experimenting with this thing called Twitter that just came out, or making a Wikipedia page for him, or all these things that obviously now are very, very old school. But at the time, they were really at the edges of what was happening. And he loved all of that and encouraged it as much for New York City as possible. And then I think, in a way, you had this second tech boom come out not long after the Great Recession and Uber and Airbnb and lots of. And I think one of the reasons that New York, if you like those things, New York had them because Mike Bloomberg saw the potential of all those and said, hey, I know the taxi system sucks. Here's a better way to do it. Hey, I know the hotel system sucks. Here's a better way to do it. If you were a Bill de Blasio type, your neighbor, then you probably would say those things were all regretful decisions. But it one of the things, when you look at Mike Bloomberg choosing to run for a third term, changing the law and everything else, I don't think that the tech sector in New York City is half as strong as it is today. If he didn't have those four more years to really tend to it and grow it and prioritize it.
- [19:34]
B
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A
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- [20:35]
B
So Tusk Strategies Forgive me for if you don't like how I describe it, but you're using campaign tactics like you learn in politics for corporate and startup strategy and regulatory issues and things like that. Now, I've been in the tech industry 25 years. It took a long time, in my opinion, for tech to realize that things like regulatory or even dealing with politicians and dealing with PR was something that was important.
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A
Yeah.
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B
So how did you even validate that such a market existed?
- [21:16]
A
Yeah, I mean, just, I honestly, I'd love to say that I was a genius and I saw it and I made it happen. The reality is I fell into it. I was sitting, I started my first company, Tough Strategies, in 2010. It's a political consulting firm that runs big legislative and policy campaigns all over the US and I was sitting in a meeting in early 2011, and a friend of mine called and said, hey, there's a guy with a small transportation startup, he's having some regulatory problems. Would you mind talking to him? I become Uber's first political advisor that day. And then when Travis Callana called me back, Travis was the founder and CEO. He said, listen, I can't afford your fee. Would you take equity? I didn't know what equity meant, but for some reason I just heard myself saying yes. And that meant I started getting stock in Uber very, very early on. But more important, it meant that it became my job to legalize Uber in New York and then markets all over the US and in many ways it was just an incredible education because I think even now, when people think about the sort of archetypical tech regulatory fight and campaign, I still think they think of Uber. And in many ways it was David and Goliath. And we were David at the time. Right. So the taxi. And now Uber is this $200 billion company, but at the time, the taxi industry was incredibly politically powerful, incredibly wealthy. They didn't want competition, and we couldn't compete with them in terms of lobbying or campaigns or anything like that. And, you know, we tried something that was really unusual, and thank God it worked, which was. And this is Travis is doing, he just said, I think our product is so much better than what Taxi offers that if we ask our customers to fight for us, they will. And I'm not sure he even knew what to do with it, but he had that thesis, and he was right. And so I remember the first time, actually was in D.C. the city council had legislation that would have basically banned Uber. And we, at that point, we had a list of our customers, and we didn't even have, like, anything in the app yet. We just literally sent them an email saying, hey, here's what's happening, and if this bill passes, you won't be able to use Uber anymore. So if you like it, would you please reach out to your council member? And then we just list, like, all of their names and numbers. Like, hopefully people would know which one was theirs. And 50,000 people reached out, like, in a week. And the council was so usually a city council member. If they got like, nine calls about something, that's a lot, right? And then all of a sudden, they're getting, like, thousands. It's like, holy shit. So not only did we beat the bad bill, we wrote our own bill and passed it unanimously. Even the sponsor of the bad bill ended up voting for our bill. And what that taught us was, wow, there's a lot of power in this thing. And then from there, we started sort of making it better and building the functionality directly into the app to allow our customers to reach out to government. And in pretty much every market in the US it was the same playbook, which was Taxi would come after us with the things that they knew how to do as a kind of the inside game. And all the people that they give donations to telling us we had to shut down, and then us going to the people. And what. What it really showed me, and this was the basis for the mobile voting project afterwards, is if every policy output is the result of a political input, if every politician makes every decision solely based on the next election, which is pretty much always true, Mike might have been different, but by and large, that's true. Then you just have to shape the equation differently. So the equation before what we did was you're a council member in Denver or New York or Seattle or wherever. The taxi guys give you a couple of grand per campaign cycle. You do what they want. Now I just had 6,000 of your constituents who normally don't pay any attention to you whatsoever, tell you, hey, I like this thing, don't mess with it. And all of a sudden you're just doing a cost benefit analysis. And not pissing off 6,000 of your constituents is a lot more important than the couple thousand dollar contribution you got from the taxi industry. And the politicians, flip, they will just do whatever they need to do to stay in office. That's it. And so we sort of learned that. And in many ways I think the playbook that we did became sort of the standard playbook for the tech regulatory fights over the next decade.
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B
One of the reasons that Uber is sort of the textbook definition of what you're describing is that the business model can't work if you can't fix the regulatory environment. Right?
- [25:43]
A
Correct.
- [25:44]
B
So this will lead us into you being an investor. Now what do you say to if you're looking at a startup or you're advising a company and it's like, this is existential, if we don't solve this part of it, the business isn't going to work. How do you tell founders and companies to think about that?
- [26:03]
A
Well, it's a few things. So one is I only invest in companies where I believe that if I do my job well or at this point that the team does it well, it will really move the needle for the company itself. So we ask ourselves, is there a gating regulatory issue or opportunity that if it were solved, can really drive growth and valuation? And when the answer is yes, that's when we decide, okay, it makes sense for us to be involved. So I could see a great company, but there's really no regulatory component to it. And we don't invest because I can't help them. I don't do anything. Whereas if you need a piece of legislation or regulation to survive, to get a license to be permitted to just be in existence, you know, then as you said, it's existential. And so one of the things that I look for in founders is do they understand that? Right. Because sometimes they don't. You explain it to them and they get it, but oftentimes they, it's so foreign to them that they don't kind of accept that in my view, often is, you know, I'm not going to tell you how to do the engineering or coding, I'm not even going to tell you how to do your marketing. But you know, if you need a political fight done to stay in business and stay alive, you need to truly believe that that is Existential. And you need to let me do my job. And so sometimes, you know, less now than the old days, but you would talk to a founder and they would say to you, no, no, no, you don't understand. I went to Stanford. I was in Y Combinator. I raised all this money. When those stupid regulators see how smart I am, they're going to do whatever I want. And typically for me, that was, okay, nice talking to you. I'm out. Because the language of politics and the language of tech are two very different languages. And to get elected officials or regulators to do what you want them to do, you have to be able to speak in terms that make sense to them and shift the incentives in a way that makes sense to them.
- [27:53]
B
Is that sort of like a tell that they don't have the stomach for? This is going to be long and complicated as opposed to just engineering something.
- [28:02]
A
Yeah, I mean, some of them don't have the stomach. I mean, I would say one of the values of the whole Uber fight is it was so high profile that it started to make people aware of, okay, if you're going to create a startup in a regulated industry, there's stuff you have to deal with. No one has a stomach like Travis Kalanick. He is the toughest person I know. And so I don't even use him as a comparison, because it's pointless. Right. You know, he's got, like, some weird gene that's sort of different, but, yeah, I mean, oftentimes, one of the things that I'll have to figure out before we decide whether to invest or to work on something is, you know, in the original meeting, when I'm laying out, here's the plan, everyone's a tough guy. I'm like, all right, we got to take off their head doing A, B, C and D. Everyone's in, right? And then oftentimes, when it becomes reality all of a sudden, no, no, no. Our lawyers are worried about it. It's not nice. It might not look good. And sometimes, if the only way to survive is to run a really brutal campaign and the alternative is death, you run the brutal campaign. And so part of what I am trying to figure out as I'm doing all this is, do they have the stomach for it? Because there's nothing worse for us than learning that halfway in, especially if we've already invested millions of dollars in the company.
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B
Okay, forgive me. I'm going to Tusk Venture Partners. Now. You're an investor. You've invested in things like FanDuel, Lemonade, sports betting, Insurance, obviously. Telehealth, things that are in a regulatory environment. You wrote a book, the Fixer, which I would recommend. But also I love the. What is it? The Gotham book. I was looking at the book prize. I looked at all of the titles earlier today that I was like, oh, God, I need that book. I need that book.
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A
There are some really good ones in there. Have you read any of them?
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B
Oh, yes, some of them I had. And what's that new one that just came out from the Bronx's Burning guy?
- [30:06]
A
I hope Ian Fraser.
- [30:08]
B
Not him, no.
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A
But anyway, Jonathan Mahler.
- [30:12]
B
Mahler. Mahler.
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A
Paradise Bronx by Ian Frazier won the prize this year.
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B
This year. Okay. All right. That was one of the ones I wanted to see. Yeah, yeah, yeah.
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A
And then, Jonathan, I have my podcast in a few weeks. We're doing an event together at my bookstore, PNT Knitwear, on, like, election week. And I, you know, it's not. There's a whole jury, but if I had to guess, it will be a nominee for the.
- [30:37]
B
Yes. Okay. This was all me trying to make some room for contemporary questions.
- [30:43]
A
Yeah.
- [30:43]
B
So let's. Let's do crypto first.
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A
Sure.
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B
It is obviously obvious and amazing that.
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A
I can go past five also, so if you need time, that's fine.
- [30:52]
B
Okay, then we'll. We'll do that. Adjust as needed here again. 25 years in tech, I have never seen a. An industry sort of meet the moment and. Or shape the moment, as crypto has done over the last three years. From basically being. We won't even take meetings with you till. To. I don't know, I don't want to say anything that'll get me in trouble politically, but let's say guiding legislation and things like that. What would you say to me about what crypto has done? That maybe it took a long time for tech to learn?
- [31:32]
A
Yeah, a few things. One is it helps to think, for me at least, when I think about kind of the regulation and politics of crypto, the original origins of crypto itself, because really what it's about is a rejection of the system. Right. Crypto. Sotoshi Nakamoto, which is a pseudonym, no one knows who it is, wrote a white paper in 2008 that kind of created the idea for Bitcoin, and that was the birth of the industry. But his entire point was, you can't trust central banks, you can't trust central governments. The game is totally rigged. And if we don't want it to be rigged, we as a crypto community, which didn't mean anything at the time. But was incredibly prescient because it happened. We are better off throwing our lot in with each other, creating our own type of digital currency with a very clear way through mining and staking as to how it's formed. And even though we don't know each other's names, which is our screen names or whatever else, I still trust you more than I trust my US Senator, my President, the head of the Federal Reserve, whatever it is. And so part of it is, while I was a vast majority of people who trade crypto are not anti systemic. They just see it as an asset that they can trade. I think that it was born in a very almost revolutionary way. And I think that that gave it a feel and a spirit that's very different than most industries. And I think oftentimes when people try to explain or think about the politics and regulation of crypto, they kind of miss that point. Right. And arguably to me, you could say that the birth of crypto wasn't even 2008, it was the Vietnam War. That was the moment when trust in institutions in the US started to fall and have never recovered. Government, Wall street, media, church, higher ed.
- [33:20]
B
And right before Bretton woods or around the same time.
- [33:23]
A
Yeah, all of that. Right, exactly. And so I think in some ways that set the stage. So my guess is this is a little before my time. But you had this medium of television, you had a war that was the first war that we ever were losing. You had the government both drafting tremendous amounts of young men and sending them overseas and then lying to the American public, both parties, by the way, consistently, and then getting caught. Right. And all of that which then fed into Watergate developed this deep distrust that has never really been regained in full sense. And I think crypto is a manifestation of that. And so one is, I think it's important to understand that. Two, what crypto did really well is there are some industries. So this was true for Uber. I have found this to be true for sports betting. I found this to be true for weed. There are some sectors where your customers really like and care about the thing that you do and they're willing to fight for you. Right. So we learned that with Uber, obviously. But I've also learned that the hard way with other portfolio companies where the.
- [34:30]
B
Founder says to me, let me interrupt you for a second because you've come back to this a couple times now. So that essentially the key constituency to run your playbook is that if your customer base is the key constituent, if they're so in love with your product, then that trumps almost anything else.
- [34:50]
A
Yeah, if you have that. Now, what's interesting is there are some sectors where that works incredibly well, and there are other sectors where they might, might be happy to spend money on your product, but they're not interested in advocating for your product.
- [35:01]
B
They're not in love with you.
- [35:02]
A
They're not in love with you, in which case you got to try a different approach. But yeah, because ultimately, at the end of the day, everything we do at my fund, at my consulting firm, my foundation, everything else, it's just premised on that one belief that every policy output is a result of a political input. So everything we do is effectively what's going to make this person do what we want them to do. Right. And what does that it's threatening or reassuring the existence of their job and their role in office. And so if you can directly mobilize millions of people, as crypto has done really well, to tell their elected officials, like, hey, I like this thing. Leave it alone. That's, you know, more powerful than anything I've come across ever.
- [35:47]
B
I assume you have AI clients these days. What is your thinking in terms of how or if or in what degree or at all AI should be regulated and. Or how it should be treated even legislatively?
- [36:02]
A
So I might surprise you with this, but I believe strongly in AI regulation. I think that one of the great mistakes by government in this century was the failure to regulate Internet 2.0. So you probably know this, but 1996, the Communications Decency Act, Section 230, which said that Internet service providers and platforms are not liable for whatever content is posted by their users. That made a lot of sense in 1996 at the birth of the Internet. What no one saw coming, obviously, was social media, Facebook, all these different platforms that then took over everyone's lives. And the lack of regulation of it meant that the platforms had a perverse incentive to actually push the most toxic content on all of us all of the time, because their economic model is based on clicks and human negativity bias, which is an evolutionary trait, means that we are just hated, like it or hate it or not, more likely to click the negative thing than a positive thing. And then those companies got so big and so powerful that they almost became too big to regulate because they were so wealthy and could have so much political clout. And the Internet has become this cesspool that in many ways has destroyed society. Right? And if we don't get out ahead of AI, it's going to be that times 100, right? And so we definitely need to regulate it. So the question is, knowing what we know now, how do you regulate it? Right. It's not like we're still working off of very limited information. So look, I think what the EU did where they came up with frameworks of here's potential harm that be caused by AI and here are ways we can try to mitigate that harm. That makes sense. This episode is brought to you by State Farm. Checking off the boxes on your to do list is a great feeling. And when it comes to checking off coverage, a State Farm agent can help you choose an option that's right for you. Whether you prefer talking in person on the phone or using the award winning app, it's nice knowing you have help finding coverage that best fits your needs. Like a good neighbor. State Farm is there. Mint is still $15 a month for premium wireless. And if you haven't made the switch yet, here are 15 reasons why you should. One, it's $15 a month. Two, seriously, it's $15 a month. Three, no big contracts. Four, I use it. Five, my mom uses it. Are you, are you playing me off? That's what's happening, right? Okay, give it a try@mintmobile.com Switch upfront payment of $45 for 3 month plan. $15 per month equivalent required. New customer offer first 3 months only, then full price plan options available, taxes and fees extra.
- [38:38]
B
CMC mobile.com okay, here's what I want to, here's what I want to ask you and you're like the perfect person to ask this. So I'm old enough to remember that like even, even when the Internet came out, there's no sales tax and things like that. I feel like the Clinton Gore era, it was like, this is a new industry. This will get us out of the early 90s recession. We are investing in the new technology to replace the factory jobs that are going away, et cetera, et cetera. Now there's almost a parallel to what's going on with AI stuff now, which is do we let, do we let this industry go unfettered because it could be, you know, abundance and all this stuff? Or was that this, is that mirroring the mistakes possibly that were made in letting the early Internet be so unfettered that it destroyed a lot of other industries?
- [39:32]
A
So it's interesting. I don't think, I think you can regulate it to try to prevent harm to individuals, to consumers, to children. I think trying to put the genie in the bottle on the economy and say, no, we're not going to let this type of growth and innovation happen. It doesn't work because it happens anyway. Or if it doesn't, your country all of a sudden becomes totally behind the times. I look at it more around the idea of every major economic transformation in history. The steam engine, the car, the computer, whatever it is, in the long term led to a lot more jobs and a lot more economic activity. And so in 20 years, when we look back at AI and say, here's 50 new industries that you and I can't even conceive of today. Pretty, pretty likely, yes. The problem is when you actually the ones living through that moment, right? And there's a lot of fallout in between and a lot of people fall through the cracks. And so to me, the role of government here is, yes, we want to protect people from the harms of AI. We also need to take care of them because there's going to be all this job displacement. You know, look, I still think the universal basic income, which Andrew Yang floated as the original idea to deal with AI job displacement is absolutely right. And I think that I have a 19 year old and a 16 year old and it's really unclear what their job prospects are going to be like because they're going to be in this moment of total transition where a lot of the jobs that are super coveted today among young people, you know, analysts at McKinsey or Goldman or whatever it is, those jobs aren't going to exist. Right. And ironically they're coming for the white collar jobs, not what you said, the Clinton and Gore said, blue collar text. So the final thing would be the redistribution of the wealth around AI. It would be a tragedy if we end up with 24 trillionaires and 18% unemployment. So I do think that they're going to have to come up with a taxation structure that as some people become wealthy beyond anyone's imagination of what they have today, and that comes at the expense of millions and millions and millions of workers. There's gotta be some way to claw back that money and redistribute it to people because otherwise you're gonna have a world where lots and lots of people are suffering. And one, that doesn't lead to stability for the economy or the government or country. And two, we're the richest, most successful country in the history of the world. Why would we tolerate a world where our own people go hungry or don't have a place to live? Like, who wants to live like that?
- [42:11]
B
We should stipulate that you were an advisor to Andrew Yang's campaign. Universal Basic income was part of the thing that he was talking about. Just two more real quick, but kind of off of this last AI and regulatory thing. If there was a move or a playbook that you pioneered, that you've used in the past that you might tell government or regulators to outlaw or at least constrain a little bit. Do you have one?
- [42:41]
A
Yeah, I have regrets if maybe that's the question. So, for example, I invested in FanDuel. We ran a lot of the campaigns around the country to legalize daily fantasy sports betting. I have no problem with that at all. But I still think we're better off with having it taxed and regulated than just having bookies. But there is an epidemic of young underage men betting on sports and doing other gambling. And the regulations that we have today are not nearly good enough when it comes to age verification. And so I would love to see something like biometric screening to ensure that you're not on those apps until you are of age. I don't have a problem with people who are of age using them, but I don't think anyone saw this coming on the other side. So that's something that I would really like to see fixed.
- [43:34]
B
Last one, and this is sort of a pie in the sky sort of question, but is there a startup idea that you wish someone would pitch you but you feel like you've never gotten because it seems from the outside like it would be too difficult regulatorily to do?
- [43:49]
A
Yeah, that's a great question. Yeah. So one is, there was one that to me seemed too crazy almost and too so far removed from the ethos of tech that I thought the reason why this hasn't happened is because the world's been waiting for someone like me to come along. And the answer was the world just wasn't looking for it. But I built a social media platform for religion called Exalt. And the idea was to sort of digitize religion, let people sort of engage in it, you know, electronically, bring people together, Bible study, whatever it might be. And I put it wasn't my fund. I just put tons of my own money into it, millions of dollars. And the world definitely was not interested in Exalt or social media platform for religion. And that went belly up very, very quickly. Yeah, look, there are all kinds of societal problems that probably could be enhanced and solved with technology, but oftentimes the tech isn't built to necessarily working governments. I'll give you a very small one. Like, I worked recently on a bill at the city council in New York to try to get rid of all the scaffolding. New York has enough scaffolding to stretch, if it's linear, from Manhattan to Montreal, and it leads to all kinds of quality life problems, higher crime, things like that. And there's a very simple tool called a drone that can do 99% of building inspections without any scaffolding whatsoever. Now, with that said, because government tends to be a really bad customer and people don't like businesses that rely on selling to government, there is no drone for building inspection. Right. But there could be. And I think even if New York City said, hey, we would buy this product, somebody would create it, I am somewhat hopeful that even though Mandani's politics are not mine, he is young and he used tack incredibly brilliantly in the campaign so far, and I've had some conversations already about this, that he will be open to ideas, to use technology to make city government operate better, serve people better, more efficiently, waste less taxpayer money. And so there's a whole host of problems that tech could solve. But just like until we started doing it, there was no real venture fund that looked at specifically the intersection of tech and regulation. There's not really yet a sector that specifically looks to build to solve new governmental problems.
- [46:25]
B
Bradley, I would point out that one way to solve the problem of if someone hasn't pitched you your dream startup is you found it yourself. You could always do that.
- [46:33]
A
You can. Now, I will say I have founded a few startups that I've lost a bunch of money on. So you do have to. Here's a challenge that I often have have, which is whether it's creating a startup or investing in one. I see something that presents a really interesting regulatory challenge or solution and I want to work on it because I'm excited by that. And that doesn't necessarily have anything to do with whether or not it's going to be a good business. Right. And like, no matter how clever the regulatory unlock might be or what public policy problem it might solve, if there is not enough consumer demand for P to ultimately be greater than L, it doesn't really matter. And I have to remind myself of that all the time.
- [47:11]
B
Last thing, you are a podcaster, so I want to let you.
- [47:16]
A
Thank you.
- [47:16]
B
Mention your podcast and tell me recent episodes, upcoming episodes, and how people check it out.
- [47:23]
A
Yeah, so it's a podcast called Firewall. It's Politics, Tech and the Pursuit of Happiness. And it's really, you know, kind of that intersection of the, if you like the stuff that you heard in this interview, the same types of things. So, like, for example, yesterday's podcast, I did a segment on, you know, the democratic party losing 2.1 million members. I did a segment on sort of the underlying interests of all the different stakeholders in the Ukrainian fight. I did a segment on a ticket swap app idea I had for baseball realignment. And then I did a segment, I do a lot of wellness stuff. I had had something called last week tms, transcranial Magnetic Stimulation for ocd. And I did a segment on sort of what that was like and when people can use it. And then tomorrow's episode will be, I had Mark Bittman on Today, and Mark is a very famous food writer and he's opening up something called Community Kitchen in the East Village in New York that will kind of a new experiment in restaurants where it's a big meal and the people who have money pay full price and the people who don't pay a much more limited price. And it's an experiment of what happens if you try to do this and bring everyone together, see if it works. But I wanted to give Mark a chance to promote it. And so, you know, it's a little bit of an eclectic podcast, but if you like things like tech, politics, sports, human behavior, nature, wellness, you might like it. It's called Firewall.
- [48:43]
B
I was going to say name of the show again is Firewall. Bradley, thanks for coming on this show.
- [48:48]
A
Thanks for having me. It.