Showing posts with label Peter Thiel. Show all posts
Showing posts with label Peter Thiel. Show all posts

Monday, May 18, 2015

The A16Z (AHo) Numbers

English: Mark Zuckerberg, Facebook founder and...
English: Mark Zuckerberg, Facebook founder and CEO, during his European Tour. (Photo credit: Wikipedia)

Each year, three thousand startups approach a16z with a “warm intro” from someone the firm knows. A16z invests in fifteen. Of those, at least ten will fold, three or four will prosper, and one might soar to be worth more than a billion dollars—a “unicorn,” in the local parlance.

With great luck, once a decade that unicorn will become a Google or a Facebook and return the V.C.’s money a thousand times over: the storied 1,000x. There are eight hundred and three V.C. firms in the U.S., and last year they spent forty-eight billion dollars chasing that dream........ Venture capitalists with a knack for the 1,000x know that true innovations don’t follow a pattern. The future is always stranger than we expect: mobile phones and the Internet, not flying cars. .... “The biggest outcomes come when you break your previous mental model. ...... en Horowitz, who sits next to his co-founder at the head of the table, is an astute manager who quotes the rap lyrics of his friends Nas and Kanye West to inspire fearless thinking—but he doesn’t try to manage Andreessen. ..... A16z was designed to be a full-throated argument about the future, a design predicated on its founders’ comfort with conflict. In 1996, when Horowitz was a Netscape product manager, he wrote a note to Andreessen, accusing him of prematurely revealing the company’s new strategy to a reporter. Andreessen wrote back to say that it would be Horowitz’s fault if the company failed: “Next time do the fucking interview yourself. Fuck you.” Ordinarily, relationship over. “When he feels disrespected, Marc can cut you out of his life like a cancer,” one of Andreessen’s close friends said. “But Ben and Marc fight like cats and dogs, then forget about it.” ....... He also tweets a hundred and ten times a day, inundating his three hundred and ten thousand followers with aphorisms and statistics and tweetstorm jeremiads. Andreessen says that he loves Twitter because “reporters are obsessed with it. It’s like a tube and I have loudspeakers installed in every reporting cubicle around the world.” ...... “We have this theory of nerd nation, of forty or fifty million people all over the world who believe that other nerds have more in common with them than the people in their own country. ...... Silicon Valley, the fifteen-hundred- square-mile shelf an hour south of San Francisco, was called the Santa Clara Valley until the rise of the microprocessor, in the nineteen-seventies. It remains contested ground. Armies of startups attack every incumbent, with early employees—and sometimes even their lawyers and landlords—taking deferred compensation, in the hope that their options and warrants will pay off down the line. Yet workers’ loyalty is not to a company or even to an idea but to the iterative promise of the region. “Uber is built on the efforts of thousands of people in the Valley,” the investor Naval Ravikant said. “On the back of the iPhone and Android and G.P.S. and battery technology and online credit-card payments, all stacked on themselves.”......... Apple and Microsoft got started with venture money; so did Starbucks, the Home Depot, Whole Foods Market, and JetBlue. V.C.s made their key introductions and stole from every page of Sun Tzu to help them penetrate markets. And yet V.C.s maintain a zone of embarrassed privacy around their activities. They tell strangers they’re investors, or work in technology, because, in a Valley that valorizes the entrepreneur, they don’t want to be seen as just the money. “I say I’m in the software industry,” one of the Valley’s best-known V.C.s told me. “I’m ashamed of the truth.” .......... they often follow one another, lemming-like, pursuing the latest innovation—pen-based computers, biotech, interactive television, superconductors, clean tech—off a cliff. ........ landing Sequoia, Peter Thiel, and a16z as seed investors “was a signal that was not lost on the banks we wanted to work with.” ....... The standard fee is “two and twenty”: two per cent of the fund each year, and twenty per cent of the ultimate profits. (The top firms, including a16z, charge thirty per cent.) ......... At the moment, venture funding accounts for less than 0.3 per cent of the U.S.’s G.D.P. “Venture is often called a rounding error in the economy” ....... the United States is as fossilized as Microsoft, and that the Valley has become stronger than Boston, New York, Los Angeles, and Washington, D.C., combined, Srinivasan believes that its denizens should “build an opt-in society, ultimately outside the U.S., run by technology.” ......... prescience. And then it’s removing every obstacle to the ferocious clarity of your vision: incumbents, regulations, folkways, people. Can you not just see the future but summon it? ....... A charismatic introvert, Andreessen draws people in but doesn’t really want them around. ..... has toyed with the idea of wearing a T-shirt that says “No hugging, no touching.” He doesn’t grasp the protocols of social chitchat, and prefers getting a memo to which he can e-mail a response, typing at a hundred and forty words a minute. He didn’t attend Netscape’s twentieth-anniversary celebration, because it combined two things from which he recoils: parties and reminiscing. ....... energetic and decisive, which makes him a valued counsellor. In 2006, Yahoo! offered to buy Facebook for a billion dollars, and Accel Partners, Facebook’s lead investor, urged Mark Zuckerberg to accept. Andreessen said, “Every single person involved in Facebook wanted Mark to take the Yahoo! offer. The psychological pressure they put on this twenty-two-year-old was intense. Mark and I really bonded in that period, because I told him, ‘Don’t sell, don’t sell, don’t sell!’ ” Zuckerberg told me, “Marc has this really deep belief that when companies are executing well on their vision they can have a much bigger effect on the world than people think, not just as a business but as a steward of humanity—if they have the time to execute.” He didn’t sell; Facebook is now worth two hundred and eighteen billion dollars. ......... Andreessen’s range of reference extends from Ibn Khaldun to “South Park,” yet he approaches new topics as if starved, eating through men’s fashion or whiskey-making or congressional politics until it has yielded every micronutrient. ....... He turns to theory the way a drinker turns to the minibar. ....... Horowitz also routinely forces a founder to abandon her script and regroup. It’s a stress test intended to elicit biography, resilience, and the real story...... the “idea maze”: you want the entrepreneur to have spent years thinking her idea into—and out of—every conceivable dead end ...... “we’re not funding Mother Teresa. We’re funding imperial, will-to-power people who want to crush their competition. ......... sixty-five specialists in executive talent, tech talent, market development, corporate development, and marketing. A16z maintains a network of twenty thousand contacts and brings two thousand established companies a year to its executive briefing center to meet its startups (which has produced a pipeline of deals worth three billion dollars). Andreessen told me, “We give our founders the networking superpower, hyper-accelerating someone into a fully functional C.E.O. in five years.” ...... They’ve moved into next-gen agricultural products and wearables and drone software ...... fifteen technology companies a year reach a hundred million dollars in annual revenue—and they account for ninety-eight per cent of the market capitalization of companies that go public. ....... “Deal flow is everything” ...... “I put ninety per cent of my effort into seeking out deals from the top eight venture firms, ten per cent into the next twelve, and zero per cent into all the rest.” ........ the bottom three-quarters of venture firms didn’t beat the Nasdaq for the past five years ...... “Since 1997, less cash has been returned to V.C. investors than they have invested.” ........ most V.C.s subsist entirely on fees, which they compound by raising a new fund every three years ....... V.C.s also logo shop, buying into late rounds of hot companies at high prices so they can list them on their portfolio page. ..... The tech publicist Margit Wennmachers built an eight-person marketing department and helped to orchestrate stories in Forbes and Fortune. ........ “In twenty-four months, Andreessen Horowitz was the talk of the town.” ...... house in Atherton, five minutes from a16z’s office ..... The toilet in the powder room is so visionary, and the surrounding dimmer lights so flattering, that I had to study it for some time to figure out how it flushed. ....... be aggressive and to fight your instinct to pattern-match. “Breakthrough ideas look crazy, nuts” ..... I see it in other people’s body language, and I can feel it in my own, where I sometimes feel like I don’t even care if it’s going to work, I can’t take more change.” ....... “O.K., Google, O.K., Twitter—but Airbnb? People staying in each other’s houses without there being a lot of axe murders?” .......... A16z passed on Airbnb’s A round in 2009. ..... Between 2004 and 2013, a mere 0.4 per cent of all venture investments returned at least 50x. The real mistakes aren’t the errors of commission, the companies that crash—all you can lose is your investment—but those of omission. There were good reasons that a16z passed on buying twelve per cent of Uber in 2011, including a deadline of just hours to make a decision. But the firm missed a profit, on paper, of more than three billion dollars. ................ Peter Thiel, who is four years older than Andreessen, observed that “the late nineties, for Gen Xers in Silicon Valley, was an experience as powerful as the late sixties was for the younger boomers. ....... “I always thought the entire venture thing was incredibly cool,” he told me. “Going to Kleiner Perkins”—the firm that funded Netscape—“with the high ceilings, the markers on the wall of all the great companies they’d I.P.O.’d, Larry Ellison walking through, and, at 11 A.M., the biggest buffet you’ve ever seen, at a time when I was eating at Subway? It was the closest thing to a cathedral for nerds.” Mark Zuckerberg told me, “When Marc started Andreessen Horowitz, I asked him why he didn’t start another company instead, and he said, ‘It would be like going back to kindergarten.’ ” .......... “Every firm we talk to now is ‘Hey, we’re doing all this recruiting, and we’ll introduce you to big customers.’ It’s become the table stakes.” ....... Andreessen is attempting to assuage the wound of the 2000 crash, by maintaining that it was an isolated event. “The argument in favor of concern is cyclical,” he told me—busts follow booms. “The counterargument is that stuff works now. In 2000, you had fifty million people on the Internet, and the number of smartphones was zero. Today, you have three billion Internet users and two billion smartphones. It’s Pong versus Nintendo. .......... “While Twitter is a lesser innovation than flying cars, it’s a much more valuable business. ........ Webvan was what he called a “ghost story”—a cautionary tale that still frightened investors. But Instacart proved that even haunted houses could be rehabilitated. ....... “This is an ‘I missed Uber, I don’t want to miss the next one’ climate.” ....... “Ordinary people love the iPhone, Facebook, Google Search, Airbnb, and Lyft. It’s only the intellectuals who worry.” ........ “Would the world be a better place if there were fifty Silicon Valleys?” he said. “Obviously, yes. ....... Pessimism always sounds more sophisticated than optimism ....... Software is already squeezing out other intermediaries—travel agents, financial advisers—and, at the end of the day, V.C.s are intermediaries. We’re all just selling cash.” ...... “What if we’re the most evolved dinosaur, and Naval is a bird?” ...... Already, more than half the tech companies that reached a billion-dollar valuation in the past decade were based outside Silicon Valley. ...... “Odds are, nothing your V.C. does, no matter how helpful or well-intentioned, is going to tip the balance between success and failure.” ........... “Over twenty years,” he continued, “our returns are going to come down to two or three or four investments ......... —you just don’t know which Tuesday Mark Zuckerberg is going to walk in.” ........ “Even if we could do perfect analysis, we just can’t know the future,” he said. “What if Google Ventures had access to all Google searches—could you predict hit products? Or perfect access to all of people’s conversations or purchases? You still wouldn’t know what’s going to happen. ....... If we could revise the industry completely, we’d just dump all the business plans and focus on people—the twenty-three-year-old Mark Zuckerberg, Bill Gates, Steve Jobs.” ......... “We’re imperfect people pursuing perfect ideas, and there’s tremendous frustration in the gap,” he said. “Writing code, one or two people, that’s the Platonic ideal. But when you want to impact the world you need one hundred people, then one thousand, then ten thousand—and people have all these people issues.” He examined the problem in silence. “A world of just computers wouldn’t work,” he concluded wistfully. “But a world of just people could certainly be improved.”

Friday, May 01, 2015

Musk Magic




I have never bought an Apple product in my lifetime. I do appreciate Steve Jobs' excellence. But he did not directly touch me. Elon Musk is a whole different story. I am looking at this guy's battery and I am thinking, this battery could do for energy for the dollar a day people what cellphones have done for communication. And lack of energy is easily the number one reason for poverty. The first computers also cost thousands of dollars. But now you can get a Chromebook (an idea Google stole from me -- I pitched to Google Ventures, bad idea) for 200 dollars. This battery needs to go down in price from 3500 dollars to 350 dollars. You can light up hospitals and schools across the world with this. Kudos Elon!

I actually was one of the first users of X.com --- but I did not hear about Elon Musk until at least 10 years later. Actually I heard of Peter Thiel before I heard of Musk. And I never connected with Thiel at any level.

Thursday, October 23, 2014

Thiel



Seven Takeaways from Marc Andreessen's Interview With Peter Thiel
The eBay acquisition of PayPal was famously drawn-out and, in fact, took five separate negotiations to finally complete. .... "In June 2002, there was this eBay convention in Anaheim. We managed to get a booth there even though they weren’t that friendly to us at the time, so we sent 30 people down to the convention. And we handed out all these PayPal T-shirts. They saw all their power sellers wearing PayPal T-shirts, and at that point, they decided to buy the company.” ......... how Musk crashed his uninsured million-dollar sportscar with Thiel in the passenger seat on the way to a venture capital meeting
http://a16z.com/2014/10/17/a16z-podcast-the-definite-optimism-of-peter-thiel/

Thiel is a big picture person. He has a stellar track record. And he paints in broad strokes.

Saturday, June 01, 2013

Late To The Bitcoin Story



I am running a little late to the Bitcoin story, but the buzz is inescapable. Gold was replaced by the government. Now the government itself is getting replaced. That makes it fundamental. It is Google not America that is leading the effort to take Africa online. That is notable. The nation state is being challenged, and not just by Wikileaks. The Bitcoin is about erasing the national boundaries and making global commerce frictionless, pretty much. The first global currency has been birthed not by heads of state and governments at summits but by anonymous tech entrepreneurs.

Bitcoin Hits the Big Time, to the Regret of Some Early Boosters
bitcoins, an intangible, digital currency that is backed by not gold or any government, but by math...... the cryptocurrency was set to upend the world of finance, perhaps more ..... Scribner, who, after buying large numbers of bitcoins early in their short history, has seen them soar in value ..... he bought his first 100 bitcoins when they were just $3 each, and then steadily amassed more at relatively low prices. A single bitcoin today now sells for just over $120..... ‘What does this do for global commerce?’ ...... easy transactions between conventional currencies, bitcoins, and a math-backed currency of the company’s own design...... CoinBase, the media sponsor of the San Jose event, received the largest venture investment in a Bitcoin business to date earlier this month. The company, which originated in the incubator Y Combinator and helps individuals and businesses use bitcoins, received $5 million from Union Square Ventures, a fund better known for backing Tumblr and Zynga. In San Jose, I also met the founders of BitPay, which enables online stores—including those hosted by Amazon—to take Bitcoin payment. Bitpay recently received $3 million from Founders Fund, led by Facebook’s first major investor, Peter Thiel....... how the company could help ease online commerce across borders ...... “Traditional payments such as credit cards don’t even work in half the world, so companies just choose to not service international customers” ..... could displace the practice of wiring money across borders, which underpins much international trade today and can be onerous ...... “If I’m trying to wire a supplier in China it’s a three- or four-day process with heavy fees,” he says. “Bitcoin transactions can be instant and free.” ...... BitPay, OpenCoin, and others also offer services that make it possible for a business to make sure incoming bitcoins keep their value by having them instantly converted to dollars. “Bitcoin can be used as just a transport network” ...... will enable money to flow as easily across the world, and between people, as e-mails and video do today..... Bitcoin’s earliest adopters were libertarians, cryptographers, and coders attracted by the idea of money that could operate without government oversight. They liked the idea that people could exchange bitcoins without knowing or trusting one another...... he quit a job with Goldman Sachs’s commodity desk in Tokyo to operate a private, one-man Bitcoin exchange business in Seattle. “These companies would be happy for it to just function like Mastercard. That is not what Bitcoin is about.” ....... the potential for a truly anonymous currency like Zerocoin to undermine existing financial and political systems ...... Bitcoin could hit the big time as less an idealistic reinvention of currency and more a technology to move payments more efficiently than today’s systems...... Jared Kenna, a 30-year-old Bitcoin millionaire
What Bitcoin Is, and Why It Matters
In 2008, a programmer known as Satoshi Nakamoto—a name believed to be an alias—posted a paper outlining Bitcoin’s design to a cryptography e-mail list. Then, in early 2009, he (or she) released software that can be used to exchange bitcoins using the scheme. That software is now maintained by a volunteer open-source community coordinated by four core developers....... “Satoshi’s a bit of a mysterious figure,” says Jeff Garzik, a member of that core team and founder of Bitcoin Watch, which tracks the Bitcoin economy. “I and the other core developers have occasionally corresponded with him by e-mail, but it’s always a crapshoot as to whether he responds,” says Garzik. “That and the forum are the entirety of anyone’s experience with him.” ...... Nakamoto wanted people to be able to exchange money electronically securely without the need for a third party, such as a bank or a company like PayPal. He based Bitcoin on cryptographic techniques that allow you to be sure the money you receive is genuine, even if you don’t trust the sender...... The existence of a public log of all transactions also provides a deterrent to money laundering, says Garzik. “You’re looking at a global public transaction register,” he says. “You can trace the history of every single Bitcoin through that log, from its creation through every transaction.” ...... If the Federal Reserve controls the dollar, who controls the Bitcoin economy? No one. The economics of the currency are fixed into the underlying protocol developed by Nakamoto. Nakamoto’s rules specify that the amount of bitcoins in circulation will grow at an ever-decreasing rate toward a maximum of 21 million. Currently there are just over 6 million; in 2030, there will be over 20 million bitcoins. ...... if more than half of the Bitcoin network’s computing power comes under the control of one entity, then the rules can change. This would prevent, for example, a criminal cartel faking a transaction log in its own favor to dupe the rest of the community...... “The combined power of the network is currently equal to one of the most powerful supercomputers in the world,” says Garzik. “Satoshi’s rules are probably set in stone.” ..... “Elaborate controls to make sure that currency is not produced in greater numbers is not something any other currency, like the dollar or the euro, has” ..... “In a Bitcoin world, everyone would anticipate that, and they know what they got paid would buy more then than it would now.” ..... even limited success could allow Bitcoin to change the fate of more established currencies. “Competition is good, even between currencies—perhaps the example of Bitcoin could influence the behavior of the Federal Reserve.”
Big-Name Investors Back Effort to Build a Better Bitcoin
OpenCoin, a startup with a new digital currency called Ripple...... digital currency called Ripple and tools for making transactions in other currencies, including Bitcoins ..... Ripple, the currency developed by OpenCoin, is similar to Bitcoin in that it uses math to prevent counterfeiting and fraud ..... transfers made with Ripple can be confirmed in seconds; Bitcoin transfers take, on average, 10 minutes to be confirmed, and many sites that accept Bitcoins make users wait an hour for confirmation ..... The company’s website for Ripple is more polished and easy-to-use than most sites built for Bitcoin users. As well as sending Ripples to other people, users can also send and exchange U.S. dollars, Euros, Bitcoins, and other currencies using the site. Ripple’s design has those transactions automatically routed through exchange companies that are working with OpenCoin. Tools are also available to allow others to offer software or websites that make use of Ripple....... Transferring Ripples is free, while transactions that involve converting between currencies involve small transaction fees—typically 0.02 percent. That’s significantly less than the fees levied by existing financial companies, such as PayPal, credit card issuers, or banks ..... “You can send e-mails for free, but not payments,” says Larsen. “Finally we might get finance to the place where e-mail or social networking has taken communication.” ..... OpenCoin plans to hand out some 50 billion Ripples in coming months, and more in the future, in an attempt to get the currency to function independently..... his company aims to turn a profit by retaining a chunk, likely 25 percent, of the total 100 billion Ripples that will ever exist, in the expectation that the currency gains value...... large Internet companies are starting to accept payments or donations in Bitcoin, including Expensify, Wordpress, and Reddit

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Thursday, July 26, 2012

Pando Monthly: Finding The Groove

Sarah Lacy
Sarah Lacy (Photo credit: jdlasica)
Drama and Mike Arrington go together, or did when he was a blogger. His selling of TechCrunch to AOL to a lot of TechCrunch oldies breaking off from the mothership when he got fired from AOL: drama.

Pando Daily entered a crowded space. It got funding, alright. It had talent, fine. But the space was crowded. But I saw room for some long form journalism. And Pando Monthly fits the bill. Although I have yet to watch any of the Pando Monthly videos, it feels like a Charlie Rose thing.

PandoMonthly Presents: A Fireside Chat with Ben Horowitz

Pando Monthly is the most outstanding thing Pando Daily has done so far. It is an innovation.
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Tuesday, July 24, 2012

Micheal Jordan Playing Baseball

English: Chicago Bulls. Michael Jordan 1997
English: Chicago Bulls. Michael Jordan 1997 (Photo credit: Wikipedia)
Taking a Risk, and Hoping That Lightning Strikes Twice
Sean Parker .... “Every good entrepreneur I know ends up in the wasteland of being a venture capitalist. It’s really frustrating” ..... “How can you as an entrepreneur that’s had success, has a reputation, ever build the courage to go and do something again?” he asked, almost rhetorically. “Most entrepreneurs don’t remain entrepreneurs. It’s just too psychologically draining to have to constantly start over.” ..... the career trajectory of many tremendously successful entrepreneurs in Silicon Valley often looks like a rocket ship that stops in midair ...... “The list of people who have started from scratch over and over and succeeded systematically over a long period of time is incredibly short,” he said. “The only person I can think of off the cuff is Jobs who had Apple, Next, Pixar, continued doing Pixar and Next and then Apple again, which is really a different company.” ..... Peter Thiel ... Marc Andreessen ... surprisingly, Mr. Andreessen said of Mr. Parker’s theory: “I sort of agree with him.” ..... “You don’t want to be Michael Jordan playing baseball.” ..... Andreessen ... an entrepreneurial effort to “rethink the model of venture capital.” .... to Mr. Parker, most entrepreneurs who seek out investments do so as “a total cop-out.” He explained his thinking: “You have a whole portfolio, you only focus on your successes, you ignore your failures and you get to continue looking like a player, but you’re ultimately not in control of anything.” ..... “Everything is probabilistic, nothing is deterministic, so you never have that satisfaction of knowing that you’re in control of an outcome. So you spend all of your time managing your reputation, managing your relationships and you spend almost no time thinking creatively or doing the things that an entrepreneur is good at doing.” ..... Being worried about failure and its effect on one’s reputation, he said, is “very dangerous.”
I so desperately want AirTime to work for me. It keeps crashing. I could not even get it to work on Chrome. It worked on FireFox, but it still keeps crashing. Sean, this was not supposed to be baseball!


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Friday, September 30, 2011

Sean Parker: Mystery Man

Image representing Sean Parker as depicted in ...Image via CrunchBaseForbes: Agent Of Disruption
Sean Parker rocked the music industry with Napster and unleashed viral marketing with Plaxo. His vision shaped Facebook; so did his paranoia. Now 31 and worth $2.1 billion, he's just getting started. ...... one pale hand on the wheel, the other toggling through thousands of songs uploaded on the car's sound system. ..... Over the last ten hours he's interviewed two potential VPs for his new video startup, answered hours' worth of e-mails about the music platform he's backing, Spotify, and met with a potential CEO for his Facebook charity app, Causes. He's also booking bands and wrangling vendors for his engagement party, scheduled in New Jersey the same night Hurricane Irene looks to hammer the Northeast ...... breaks from work to dine with Jack Dorsey ...... By the time he drops me off at my hotel, it's 11:30 p.m. Parker's day is about half done. ...... For the next six hours Parker fires off e-mails, then turns to his private Facebook page. The previous afternoon--or earlier the same day, if you're on Parker's body clock ...... Around 6 a.m. Parker posts this Schopenhauer quote: "We can come to look upon the deaths of our enemies with as much regret as we feel for those of our friends, namely, when we miss their existence as witnesses to our success." It immediately leaks. Gossip site Gawker accuses him of dancing on Jobs' grave. He e-mails Gawker that the quote was a tribute to Jobs--his longtime idol and more recent rival (iTunes versus Spotify). Just before 7 a.m. he goes to bed. ........ Four hours later he's up ..... Flighty, manic and unpredictable, Parker grates on investors--he's been jettisoned from the three companies he helped create, soon after they lifted off. "He's seen as an unknown quantity, and VCs love for things to be very much in control" ....... But VCs also love big ideas, and Parker has those in spades--LinkedIn founder Reid Hoffman calls him a "big-ass visionary." And in terms of boardroom scheming, he's nothing like his fictional portrayal in The Social Network. "The movie needed an antagonist, but that's not what he was," says former Facebook growth chief
Sean ParkerImage by cattias.photos via Flickr Chamath Palihapitiya. "He's really the exact opposite of his portrayal in the film." ...... a human accelerant, an idea catalyst who, when combined with right people, has fueled some of the most disruptive companies of the last two decades ...... At just 19 he blew up the record industry as the cofounder of the music-sharing site Napster ...... 24-year-old president of Facebook ...... He's also hunting new startups as general partner at venture firm Founders Fund and reuniting with Napster's Shawn Fanning to create Airtime, a live video site. ....... His personal network is astounding, a combination of foresight and fate. Starting as a teenager, when he interned for current Zynga Chief Mark Pincus, Parker has teamed, in one way or another, with the men who now control the modern Internet: Mark Zuckerberg, Mike Moritz, Peter Thiel, Reid Hoffman, Yuri Milner, Dustin Moskovitz, Adam D'Angelo, Daniel Ek, Ron Conway, Ram Shriram and Jim Breyer. ....... "Parker has access to trends and signals that are invisible to many people. For him it's like hearing a dog whistle." Parker doesn't disagree: "I find a lot of things relevant that aren't necessarily relevant to the world when I'm thinking about them." ....... Parker is drawn to big, universal problems and spends years looking for them. ...... his recently purchased $20 million Manhattan town house ...... "The transition strategies are more important than understanding what the outcome state will be." ...... Parker put himself in position for the string of blockbusters that his critics blithely attribute to sequential luck. ..... "He thinks about where he perceives the world to be going," explains Spotify founder Daniel Ek. "If he doesn't think there is a company that will win, then he builds it himself." ....... Ask Parker about the genesis of his former company Plaxo and he starts with theories of how real viruses spread across populations. Before he shares the name of his favorite sushi restaurant--prior to one dinner we had in New York he called five to find out which chef was cutting the fish that night--he discusses rice density and the ideal geometric shape for sushi cuts (trapezoids). Question the audiophile about the best brand of headphones and you first learn how sound waves are registered by our tympanic membranes. As the expression goes, ask him for the time and he'll tell you how to build a watch. ........ "We talked for what I originally scheduled for an hour, ended up being three hours," Reid Hoffman recalls about their first meeting back in 2002. Twitter founder Dorsey had the same experience: "It's rare to find someone who can have those kinds of conversations. ... I appreciate any conversation where I can walk away questioning myself
MUNICH, GERMANY - JANUARY 23:   Sean Parker, m...Image by Getty Images via @daylife and my ideas." ........ Parker's life becomes impervious to time, a subject friends and business partners acknowledge with a defeated laugh. Peter Thiel calls it Parker's "absence of dramatic punctuality." Ek manages Parker by telling him there's a meeting at 11 a.m. and informing others it starts at 1 p.m. There's even a name in Silicon Valley for this phenomenon: Sean Standard Time. ...... When focused on a task, he blocks everything else out and works himself into a trance. The outside world fades; time slips away. "It requires a lot of rescheduling, but I try to focus on things that are the highest value and get those done perfectly." ....... Parker's definition of "done perfectly" is extreme. ....... He's trying to lose weight and is eating only vegetables. ...... After hundreds of photos in four locations around the house, the shoot is finished. It's now 2 a.m.--perfect, calibrated Sean Standard Time. ........ Two nights later I arrive at his house at 11 p.m. A chartered G450 is scheduled to fly to San Francisco from Teterboro, N.J.--wheels up at midnight, sharp. Parker is out meeting Spotify's Ek. When midnight hits and there is still no Parker, I get a little nervous. Everyone else yawns. Parker struts in at 2 a.m. He still has to pack and shower. At 3:30 a.m. a Cadillac Escalade is loaded with luggage and take-out fried chicken from Blue Ribbon, a late-night New York chefs hangout, and across the Hudson we go. ........ We take off at 4 a.m., a half hour before FAA fatigue laws would have grounded the pilots. When I awake to a view of the California desert outside the plane window, Parker is sitting across from me, snacking on a piece of fried chicken, his veggie-only diet already over. "Did you sleep well?" ....... his father, Bruce, formerly the chief scientist at the National Oceanic & Atmospheric Association, taught him how to program on an Atari 800. He was in second grade. ...... At 15 his hacking caught the attention of the FBI, earning him community service. At 16 he won the Virginia state computer science fair for developing an early Web crawler and was recruited by the CIA. Instead he interned for Mark Pincus' D.C. startup, FreeLoader, and then UUNet, an early Internet service provider. ......... Parker made $80,000 his senior year, enough to convince his parents to let him put off college and join Shawn Fanning, a teenager he'd met on a dial-up bulletin board, to start a music-sharing site that became Napster in 1999. ....... "I kind of refer to it as Napster University--it was a crash course in intellectual property law, corporate finance, entrepreneurship and law school," says Parker. "Some of the e-mails I wrote when I was just a kid who didn't know what he was doing are apparently in [law school] textbooks." ........ by that time Parker had already been exiled by management and was living in a North Carolina beach house. "I didn't understand at the time that when someone asks you to take an extended vacation that's basically a prelude to firing you." ........ While at Napster Parker met angel investor Ron Conway, who was funding another company in the startup's building in Santa Clara. Conway has backed every Parker production since. ....... Napster was less a company than an all-hours circus, a strange tangle of people who thought they joined a renegade social movement rather than a startup. ....... "So much of what I learned at Napster was learning what not to do," says Parker, as Conway scribbles on a notepad. He learned to listen to Parker the hard way. "When Sean became president of Facebook, he called me and said, ‘You have to look at this company.' The killer is that I could have been Peter Thiel," says Conway, referring to Thiel's investment in Facebook that made him a billionaire. "But I said, ‘You have to clean up the issues at Plaxo, so don't introduce me to this Facebook thing.' " He sips his wine, shakes his head and laughs: "These are painful memories." ......... Plaxo was Parker's first attempt at creating a real company--an online service that aimed to keep your address book up to date. It sounds boring compared to Napster and Facebook, but Plaxo was an early social networking tool and a pioneer of the types of viral tricks that helped grow LinkedIn, Zynga and Facebook. "Plaxo is like the indie band that the public doesn't know but was really influential with other musicians," Parker says. ........ "In some ways Plaxo is the company I'm most proud of because it was the company that wreaked the most havoc on the world," says Parker. ........ There are diverging stories about Parker's swift exile from Plaxo. His take is that Ram Shriram, a former Google board member recruited to help manage the company, conspired to throw him out and strip him of his stock. "Ram Shriram played this very vindictive game not only to force me out of the company but force me out broke, penniless, impoverished and with no options." ........ cofounders Todd Masonis and Cameron Ring share a different story: that Parker was essential in creating the company strategy and raising money but grew bored with the daily grind of running it. Masonis claims that Parker was often absent, and when he was around, he was distracting: "It was the sort of thing where he doesn't come to work, but then maybe if he does it's at 11 p.m., but it's not to do a bunch of work, it's because he's bringing a bunch of girls back to the office because he can show them he's a startup founder." .......... Whatever the motivation, Parker's removal was messy. He insists investors hired a private eye to build a case. ........ Parker was on his own, isolated from his cofounders and close friends. "I felt a complete loss of faith in humanity, impending doom, a sense that I couldn't trust anybody," says Parker. ....... shown Facebook by a friend's girlfriend (versus the one-night stand depicted in Aaron Sorkin's screenplay) he was already a social networking veteran, both because of Plaxo and, more directly, as an advisor to Friendster, the ill-fated Facebook forerunner he stumbled across when reporters asked him if it was connected to the similar-sounding Napster. ........ He wrote to Facebook's generic e-mail address and later met Zuckerberg and Eduardo Saverin over a Chinese dinner in Manhattan in the spring of 2004. ........ A few weeks later, by chance, he ran into Zuckerberg and crew on the streets of Palo Alto and shortly moved into Dustin Moskovitz's room at the rented Facebook house. "It's the only thing the movie got kind of close to right," deadpans Adam D'Angelo ......... Just 24, Parker was Facebook's business veteran. He helped the collegeaged Facebook founders network around Silicon Valley, set up routers and meet benevolent investors like Thiel, Hoffman and Pincus. ........ "Sean was pivotal in helping Facebook transform from a college project into a real company," Mark Zuckerberg says in an e-mail. "Perhaps more importantly, Sean helped ensure that anyone interested in investing in Facebook would not only buy into a company, but also a mission and vision of making the world more open through sharing." ........ D'Angelo credits Parker for recognizing that design was as vital as engineering. ....... Together with Aaron Sittig, an early Napster friend who would become Facebook's key architect, Parker helped drive Facebook's minimalist look. He was adamant that the site have a continuous flow and tasks like adding friends be as frictionless as possible. "We wanted it to be like a telephone service," says Sittig. "Something that really fades into the background." Later Parker helped push Facebook's photo-sharing function. It would be one of his last acts as Facebook's president. ........ In August 2005 Parker was questioned in North Carolina after cops found cocaine in a beach house rented under his name. He was never arrested or charged, but the incident swiftly kick-started his downfall at Facebook. ....... Accel Partners resented him because he forced the VC to invest in Facebook at a then high $100 million valuation ..... He had been pushed out of his third company in five years. He moved to New York in the fall of 2005, crashing with Grateful Dead lyricist John Perry Barlow, a friend from the Napster days. ....... was a strong outside influence in the development of Facebook's "Share" platform, which allowed users to upload news articles, video and other third-party content. ....... his greatest contribution to Facebook was his creation of a corporate structure--based on his Plaxo experience--that gave Zuckerberg complete and permanent control of the company he founded. ........ Parker's plan fortified Zuckerberg with supervoting shares that resisted dilution during fundraising and armed him with enough board seats to stay in power for as long as he wanted. ...... At Plaxo Parker had endured in real life what the fictional Saverin suffered in the film. "I don't mind being depicted as a decadent partyer because I don't think there's anything morally wrong with that," says Parker, quickly adding that the partying was exaggerated, too. "But I do mind being depicted as an unethical, mercenary operator, because I do think there is something wrong with that." ......... "I was a mess at that point because the movie had hit, the depiction of me was so far from reality I was having a hard time psychologically dealing with it," Parker says. "I was all bummed out, I had just broken up with my girlfriend of four years and I just had knee surgery, so I couldn't walk." ..... a mutual friend introduced him to his future fiancĂ©e, the 22-year-old Lenas, a singer-songwriter. ........ remains a hacker at heart, motivated less by money than the drive to disrupt. ..... he never stopped thinking about Napster. Eight years after it had been sued out of existence he was still searching for a company that could fulfill Napster's promise of sharing music ...... Two years ago a friend told him about a Swedish music site called Spotify that offered unlimited, legal songs. He scoured his network for an introduction, and without seeing the product in action, blindly e-mailed founder Daniel Ek, outlining his ideal music platform, hoping Spotify fit the description. ......... Ek had been a huge fan of Napster, and Parker's suggestions caught his attention: "This was someone who had spent more time thinking about this than I had done myself." After a series of e-mails and a test drive of the platform, Parker was sold and tried to invest. Armed with a cash infusion from Hong Kong billionaire Li Ka-shing, Ek wasn't looking for any more. Parker would have to prove his way into the company. He introduced Spotify to Mark Zuckerberg (a Facebook integration plan was scheduled to be introduced shortly after this article went to press) and helped open doors at Warner and Universal, winning over Spotify's board: He eventually invested about $30 million. ......... communication and sharing in real time--something he thinks is underserved on the Web ...... "My pitch is eliminating loneliness," Parker says. There's also a random video chat function similar to last year's voyeuristic flameout, the now defunct Chatroulette. ......... He flies in a monthly loop from New York (base) to Los Angeles (music executives) to San Francisco (Founders Fund), then Stockholm and London (Spotify). In my last meeting with him I asked where he files his taxes. "That's a damn good question. I don't even know." ....... "I actually couldn't honestly tell you whether we've been here for two hours or 20 minutes." ....... Spotify and Airtime, that may yet again redefine life on the social Web.
Slate: Lunch With Sean Parker