Fireside chat with Jason Calacanis & Brad Gerstner hosted by Mubadala’s Ibrahim Ajami | E1746 | Summary and Q&A

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May 19, 2023
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This Week in Startups
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Fireside chat with Jason Calacanis & Brad Gerstner hosted by Mubadala’s Ibrahim Ajami | E1746

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Summary

In this fireside conversation between Brad Gerstner and Ibrahim Ajami, they discuss the state of the technology industry, the importance of focusing on product, the impact of AI, and the future of startups. They also touch on Mark Zuckerberg's leadership at Meta (formerly Facebook) and how Silicon Valley is adjusting to the current market conditions.

Questions & Answers

Q: How did Brad Gerstner and Ibrahim Ajami start the conversation?

Brad expressed his excitement about being in Abu Dhabi and compared the energy in the room to being on Sandhill Road in Silicon Valley. Ibrahim mentioned that meeting Brad and Jason was a special moment for him, as he had hoped to meet them someday. They both highlighted the vibrant tech community in Abu Dhabi.

Q: How does Brad view the current correction in the technology industry?

Brad sees the current correction as a financial reset rather than a tech reset. He mentions that Silicon Valley has experienced similar corrections in the past, and each time it has led to a healthier environment for both venture capitalists and founders. Excess liquidity and free money tend to lead to overfunding and competitive market dynamics that can harm the economics of industries. Brad believes that the current scarcity period is beneficial for founders who are willing to grind it out and build meaningful companies.

Q: What qualities does Jason look for in founders during challenging times?

Jason emphasizes the importance of focus and relentless focus. He believes that founders should prioritize building products that delight customers and solve real problems. Founders should be obsessed with their product and customers and have a high level of product velocity. Jason mentions that successful founders are often willing to sacrifice their sanity, relationships, and make significant sacrifices for their startups.

Q: How does Brad evaluate founders and their products at Altimeter?

Brad takes a thematic approach to investing, focusing on super cycles and long-term trends. He looks for founders who are working on ideas that align with these super cycles and have the potential for significant growth. One example is his investment in the modern data stack, which includes companies like Snowflake and MongoDB. Brad believes that identifying the right market and the best teams to capture the opportunities within these markets is crucial for successful investments.

Q: How does Jason evaluate founders and their products at his firm?

Jason works with early-stage founders and invests at the seed stage. He looks for founders who demonstrate craftsmanship, thoughtfulness, and an obsession with product design and details. He believes in the power of small, efficient teams and emphasizes the importance of execution over ideas. Jason advises founders to focus on building products that solve real problems and bring value to customers.

Q: How do Brad and Jason view the impact of AI on startups and the industry?

They both believe that AI presents a significant opportunity for value creation. Jason mentions that AI tools and technologies can make teams more efficient and predicts that smaller teams will be able to achieve more with the help of AI. Brad emphasizes the potential for AI to transform industries and solve complex problems. They both agree that AI will enable startups to achieve faster development cycles and bring products to market more quickly.

Q: How did Brad's letter to Mark Zuckerberg impact Meta?

Brad wrote a letter to Mark Zuckerberg expressing his concerns about the company's focus, and he suggested doubling down on AI and narrowing the scope of the metaverse project. While it's unclear if the letter directly influenced Mark's decisions, Brad believes that Mark's curiosity and openness to feedback played a significant role in Meta's refocusing on AI. The letter was also a message to the broader tech community about the importance of focusing on the core business and staying mentally flexible.

Q: How do Brad and Jason view the future of startups in light of the current market conditions?

They believe that the current market conditions present an opportunity for startups to thrive. Smaller, more focused teams will be able to achieve more with the help of AI and technological advancements. Jason predicts that there will be stories of small teams achieving significant revenue numbers, thanks to their efficiency and product velocity. Both Brad and Jason highlight the importance of relentless focus, execution, and passion for solving problems in building successful startups.

Takeaways

The current correction in the technology industry is seen as a financial reset rather than a tech reset. This period of scarcity is healthy for both venture capitalists and founders, as it separates the truly dedicated founders from those looking to get rich quick. Founders need to have relentless focus, obsession with the product and customers, and the ability to execute efficiently. AI has the potential to significantly impact startups and industries, enabling smaller teams to achieve more, increase efficiency, and bring products to market quickly. Brad and Jason believe that the current market conditions present a great opportunity for startups to thrive, as long as they remain focused and passionate about their products and customers.

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