Chamath

And vintage distortion is so real. It's very hard to understand how each of these vintages with your late bloomers or overpriced things, companies getting $100 million rounds at a billion dollar valuation before they have product market fit. And those distortions,

And vintage distortion is so real. It's very hard to understand how each of these vintages with your late bloomers or overpriced things, companies getting $100 million rounds at a billion dollar valuation before they have product market fit. And those distortions,

were just so pronounced the last five to 10 years that we're now sorting them out like a house of mirrors where you don't know who's tall, who's fat, who's skinny, what the reality is here. And the other big thing is this peanut butter effect that I tweeted about today. During peak Zerp, you had all these exceptional team members

were just so pronounced the last five to 10 years that we're now sorting them out like a house of mirrors where you don't know who's tall, who's fat, who's skinny, what the reality is here. And the other big thing is this peanut butter effect that I tweeted about today. During peak Zerp, you had all these exceptional team members

You know, the number two, three, four, five person at a company that was doing great, they would leave to start their own company. So the talent got spread. Then you had so many of these founders rushing into the same vertical. So you'd have 20 startups because there was too much capital pursuing the same opportunity. You pursued the same opportunity. What happens to earnings?

You know, the number two, three, four, five person at a company that was doing great, they would leave to start their own company. So the talent got spread. Then you had so many of these founders rushing into the same vertical. So you'd have 20 startups because there was too much capital pursuing the same opportunity. You pursued the same opportunity. What happens to earnings?

They get spread then. What happens to customers? They get spread across 20 different products competing for the same customer. And then what happens with, you know, ownership stakes for us as GPs and LPs, Chamath, the ownership stakes, because the valuations went up so much, they got spread like peanut butter. And instead of a Series A getting you 20% of a company, it got you 10.

They get spread then. What happens to customers? They get spread across 20 different products competing for the same customer. And then what happens with, you know, ownership stakes for us as GPs and LPs, Chamath, the ownership stakes, because the valuations went up so much, they got spread like peanut butter. And instead of a Series A getting you 20% of a company, it got you 10.

Instead of a C-check getting you 5%, it got you one.

Instead of a C-check getting you 5%, it got you one.

I don't know what it is, but we need to do something because the status quo doesn't work. I think there's so many good points that we're hitting here. I'll just say the other thing to build on your point about, hey, these take less capital. You have to look at what does your ownership, after you've been diluted half by 50% as a seed or series A investor, you're going to be down to half.

I don't know what it is, but we need to do something because the status quo doesn't work. I think there's so many good points that we're hitting here. I'll just say the other thing to build on your point about, hey, these take less capital. You have to look at what does your ownership, after you've been diluted half by 50% as a seed or series A investor, you're going to be down to half.

So if you own 10%, you own five. If you own seven like YC or we do in a company, you're going to own three. You're going to really have to model out, is the valuation you're looking at, what does it pencil out to for an outcome?

So if you own 10%, you own five. If you own seven like YC or we do in a company, you're going to own three. You're going to really have to model out, is the valuation you're looking at, what does it pencil out to for an outcome?

And when I did this with our investments, I saw a leak in my game, which was, hey, I'm putting $100K into a $25 million round or a $50 million round as a follow-on investment to support the founder. okay, what does that do for my LPs? Well, that 100K would need to hit some extraordinary outcome, five, 10, 20, $40 billion in order for us to return the fund.

And when I did this with our investments, I saw a leak in my game, which was, hey, I'm putting $100K into a $25 million round or a $50 million round as a follow-on investment to support the founder. okay, what does that do for my LPs? Well, that 100K would need to hit some extraordinary outcome, five, 10, 20, $40 billion in order for us to return the fund.

So now my team understands, hey, take that 125K, that 250K, that 500K, do four more accelerator companies with it because those could return the fund. And that fund math, people stopped doing. I think all these fund managers who are getting wiped out, they never penciled out What does this company I'm giving a million dollars need to hit in order for me to return my fund?

So now my team understands, hey, take that 125K, that 250K, that 500K, do four more accelerator companies with it because those could return the fund. And that fund math, people stopped doing. I think all these fund managers who are getting wiped out, they never penciled out What does this company I'm giving a million dollars need to hit in order for me to return my fund?

And now they're finding out that it doesn't work.

And now they're finding out that it doesn't work.