I’m excited to share my conversation with Jimmy Soni, the author of the incredible book The Founders! In this episode, we discuss the power of the people around you, Brad Stone’s influence on Jimmy’s writing process, the value of network effects in PayPal’s business, Thiel’s developing thoughts around competition, Elon’s skin in the game, and the tumultuous culture of PayPal post-merger. If you’re interested in entrepreneurship, technology, or simply drama-ridden stories set in the dot-com bust era, you’ll love his book!

The Founders: The Story of PayPal and the Entrepreneurs Who Shaped Silicon Valley - Jimmy Soni

Jimmy Soni's The Founders tells the incredible story of the founding of PayPal and the influential characters behind the online payments provider. From monopoly-forming mergers to multiple backstabbings and intense competitive dynamics on another platform’s home turf, this story has it all. We will be weaving between the stories of Confinity and X.com, eventually arriving at the PayPal merger and many of the subsequent innovations in the online payments space. The PayPal founders have had an outsized impact on Silicon Valley, with companies such as Tesla, SpaceX, YouTube, LinkedIn, Affirm, Palantir, Founders Fund, and Yelp all coming from these great entrepreneurs.

The Founders: The Story of PayPal and the Entrepreneurs Who Shaped Silicon Valley - Jimmy Soni

Competition is for Losers - Peter Thiel

Joe Coulombe shares his insightful lessons from founding Trader Joe’s, spanning from his early focus on the overeducated and underpaid customer segment to later innovations across intensive buying and double-entry retailing. We discuss the stories and lessons from his excellent book, Becoming Trader Joe, including his emphasis on paying employees well, having deep product knowledge, selecting prime locations, targeting high sales per SF over pure growth, and leveraging lower SKU counts. Fans of Trader Joe’s and all business entrepreneurs will thoroughly enjoy this episode!

Becoming Trader Joe - Joe Coulombe

Trader Joe's: Grocer to the Overeducated & Underpaid - Business Breakdowns

Should America Be Run By... Trader Joe's? - Freakonomics Radio

Ed Thorp is a remarkable figure, achieving great success in the casinos of Las Vegas and Wall Street, while also investing in Berkshire at $1K, contributing the first LP check to Ken Griffin’s fund Citadel, and calling the Bernie Madoff Ponzi scheme 18 years before Madoff was exposed! Thorp advises us to only invest when we have a clear edge, question the commonly held assumptions, attract top talent with superior pay, beware of following the masses, and prioritize physical fitness to ensure longevity. We discuss his life story and wisdom from his enthralling autobiography, A Man for All Markets.

A Man for All Markets - Ed Thorp

Bull Market Rhymes - Howard Marks

In Part 3, we discuss the decline of Kleiner Perkins, the institutionalization of growth equity with DST & Tiger Global, a16z’s emergence, Sequoia’s sustained dominance, and the main takeaways for the VC industry going forward.

The Power Law - Sebastian Mallaby

In Part 2, we discuss Google’s origin story, Brian Arthur’s increasing returns to scale, Peter Thiel’s founder-friendliness & competition is for losers philosophies, Paul Graham’s founding of YCombinator, Neil Shen’s Sequoia China ambitions, and Meituan’s monopolization of the China services industry in “the war of a thousand Groupons”.

The Power Law - Sebastian Mallaby

Increasing Returns to Scale - Brian Arthur

Competition is for Losers - Peter Thiel

Sebastian Mallaby’s The Power Law is an incredible account of the history and evolution of the venture capital industry. We explore how power laws shape returns within a VC fund, where one investment can more than pay off for the entire rest of the fund. In Part 1, we discuss the early founding of liberation capital with Arthur Rock, the formation of historic firms Sequoia Capital & Kleiner Perkins, Apple taking advantage of the innovator’s dilemma, John Doerr dominating the 90s, Accel creating the first specialized firm, the arrival of Masa and growth investing, and Benchmark Capital’s big bet on eBay. 

The Power Law - Sebastian Mallaby

Superforecasting describes how we live in a probabilistic and uncertain world, but we seek out certainty and absolutes in our everyday lives. Using examples across Fantasy Football, Inverse Jim Cramer, Inflation, and Chipotle’s future growth, we discuss how hard it is to predict the future, and how we are often flawed in our prediction updating abilities. Beliefs are hypotheses to be tested, not treasures to be protected → we must constantly update our beliefs based on new information and use base rates, devil’s advocates, and premortems to fight off our natural confirmation & identity biases.

Superforecasting: The Art and Science of Prediction - Phil Tetlock & Dan Gardner

Healing Back Pain, by Dr. John E Sarno, is an interesting exploration into the role our repressed emotions play in creating physical pain. The physical pain behind chronic back and neck pain distracts our attention from the true issue, which is our repressed anger & anxiety in our lives. Physical pain is meant to distract us from the hidden emotional pain, and we must bring that emotional pain to the surface in order to relieve our physical suffering. Healing Back Pain is a worthwhile read for anyone experiencing chronic pain and under high levels of stress.

Healing Back Pain - John E Sarno, MD

Zell is a phenomenal real estate investor to study, with core investing tenets that we should all look to emulate. His investment mantras include: failure is not in my lexicon; simplify risk down to its most important variable; if everyone is going left, look right; if there is scarcity, price is no object (thus avoid competition like the plague); leave a little bit of money on the table in any negotiation (seek win-win outcomes); and beware of euphoria bubbles, but go bargain hunting after the crash (the Grave Dancer). Investors from all walks of life will enjoy this episode!

Am I Being Too Subtle? - Sam Zell

Sam Zell Interview - Graham & Doddsville