12/15/2023 0 Comments Elizabeth holmes venture capitalism![]() ![]() KHOSLA: I don’t mind a 90 percent chance of failure if the consequences of success are consequential, like changing animal husbandry on the planet or making fusion reactors possible. So you need a temperament that can handle it. For every Apple or Impossible Foods, there are thousands of failures. Venture capital is inherently risky, especially at the early stage of a startup. That is a much safer way to extract billions of dollars. The seventh is Berkshire Hathaway, Warren Buffett’s holding company, which essentially gobbles up existing firms. If you look at the 10 biggest companies in the world as measured by market capitalization, seven are American and six of those raised venture capital: Apple, Microsoft, Amazon, Tesla, Facebook, and Alphabet (the parent of Google). Now, what would have happened to Pat Brown’s idea in a different time, or a different place - I mean, a time and place without venture capital? Access to that kind of money for nothing more than an idea is a decidedly American phenomenon. Eventually the venture capitalists will get their money back, and much more. It is still privately held, and it’s already thought to be worth around $7 billion. It’s called Impossible Foods, and it makes plant-based substitutes for meat products. After several years and more than a billion dollars in venture money, his company became a sensation. KHOSLA: As ridiculous as that sounded, it took us a half-hour to say, “Love the passion, love the mission, love Pat’s credentials.” And we said, “We’ll back you.” I just told these guys, “Look, this is an environmental disaster. Pat BROWN: My pitch to them was very naive from a fund-raising standpoint. And that’s what Brown would tell the venture capitalists. He had come to believe that the production of meat was really bad for the planet. Pat Brown was a very well-regarded biomedical researcher. KHOSLA: Pat Brown was a professor at Stanford, and he came to us and said, “I want to change animal husbandry on the planet.” That was his entire pitch. Khosla often invests in little more than an idea. Since 2004, it has invested in nearly 1,000 startup companies. and, therefore, one of the biggest V.C. Today he runs one of the biggest venture capital firms in the U.S. He did come to Silicon Valley, and in 1982 he co-founded the technology firm Sun Microsystems. And I still remember vividly, I called the phone company and they said, “Seven years to get a phone line.” I said, “I’m coming to Silicon Valley.” There wasn’t an entrepreneurial culture there. KHOSLA: I did try and start a soy-milk company - I never got it started. Stephen DUBNER: But didn’t you start a soy milk company in Delhi? If that immigrant can do it, why can’t I? Vinod KHOSLA: I was 16 in India when I heard about, and in fact read in a two-year-old magazine that I used to rent - once they were old, they came to India, and you could rent them for the weekend - that Andy Grove, a Hungarian immigrant, had come to Silicon Valley and started Intel. ![]()
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