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Surviving the Dot-Com Bust · Oxide and Friends

• 0:00
  Speaker 1: Alright. So we're we're talking, .com bust. I I think that, like, the bust has been kinda on the mind because, Adam, have you been you've obviously been seeing all these, various threads about people warning, of the fact that winter has arrived.
• 0:15
  Speaker 2: Absolutely. And and and, I mean, and arriving very quickly. I think the starkest of them being VCs like a month ago, all in on web 3, and then, you know, 20 minutes ago, apologizing to LPs, like, that kind of about face.
• 0:34
  Speaker 1: It feels pretty quick. It does feel pretty quick. And it I I feel like, you know, one of the the the things that I certainly felt during the bust is that once things turn, they turn way faster than you thought they could. We saw it was my my recollection. It went on much longer.
• 0:52
  I feel the same with the housing bubble too. These bubbles go on way longer than you think they should, but when when they actually turn, they turn way, way, way faster than you you you thought they possibly could.
• 1:03
  Speaker 2: So I I totally agree on that, but I also think that, the denial persists a surprisingly amount a surprising amount of time. You know, I I wanna get into more of this, but definitely when I joined
• 1:16
  Speaker 3: Sun, and the stock
• 1:17
  Speaker 2: was, like, at not that, like, $10, everybody everybody said, well, there's only one way it can go from here. And they were right.
• 1:28
  Speaker 1: Okay. They were right. They were right.
• 1:32
  Speaker 2: In a sense
• 1:32
  Speaker 1: There is only one direction I can go from here. The problem is it is the wrong direction.
• 1:36
  Speaker 2: That's right.
• 1:37
  Speaker 1: Okay. Did you hear the picks and shovels thing at Sun? I feel like we said that a lot. I heard that a lot, certainly.
• 1:45
  Speaker 2: Yes. I I mean, the this is a phrase that that that really rings a bell, but I'm, help me out.
• 1:50
  Speaker 1: So this is the this was an old, like, gold rush for I don't even know if this is even true. But one of the things that felt like it was repeated a lot during the boom was an an analogy to the gold rush in that the the the companies that made money in the gold rush were those that were selling picks and shovels. I guess Levi's famously, made a lot of money in gold rush. I can't I would like, this could all be checked. I I did this was kind of I I would love to know how much of this is actually true.
• 2:20
  I mean, like, what shovel magnate came out of the the gold rush? Just remind me. I mean, it's not like, what what what massive American picks and shovels enterprise came out of the government.
• 2:34
  Speaker 2: Any major town has
• 2:36
  Speaker 1: the old You know what? At the center of town. Right? Right. The old and actually so, musically, sadly, I actually somewhat know the Shubble University.
• 2:46
  Right. I I somewhat know the answer to this question because, the, the building the transcontinental railroad, which is after the gold rush, 18/69, One of the, the the lions of the transcontinental railroad is a guy named Oakes Ames, who actually was a shovel magnate. So I mean, these people do exist. The only reason I remember this is Bain had a very good David Bain has
• 3:10
  Speaker 4: an excellent book on the
• 3:11
  Speaker 1: Transcon Railroad. The Oaks Ames is known. And, Adam, you're gonna love this. You know, all these barons have these kind of, you know, these monikers by which they are known, and he is known as the king of spades. That's How awesome is that?
• 3:29
  Speaker 2: Ugh. Makes me want a big
• 3:30
  Speaker 1: right. Exactly. Makes you want to come shovel bagging. So other than Oak Saves, I was like, okay. Fine.
• 3:34
  You built a Transcontinental Railroad. But yes. Exactly. Like, there's no there's no picks and shovels library. They are, and this, of course, like, didn't take this apart because you wanna keep believing.
• 3:47
  So, like, oh, yeah. Picks and shovels. Like, we're Levi's. We're not it's like no dummies. Like, Like, no gold rush.
• 3:54
  No anything else. And, I felt like yes. There was that period of denial. Adam, would
• 4:01
  Speaker 2: And in particular so, I mean, this referred to Sun Machines being prolific in these .coms. Right? That that they would buy tons of them in in many cases, many, many more than they could ever use.
• 4:14
  Speaker 1: Yes. And so for me, the ur example of this was, boo.com, which I remember be getting in giggle fits as we were talking about boo.com because we had a file called boot.conf, and we just thought, anyway, it was that you had to be there.
• 4:33
  Speaker 5: You had to be there. Right?
• 4:34
  Speaker 1: Or maybe not. Anyway, boo.com was, a big Sun customer, and they had an e ten k, a galactic machine, with exactly one CPU board in it. It's like, this is not this is not a good sign. This this is a person who was this is a very good salesperson, but this company hasn't. And boo.com was a very early flame out.
• 4:58
  They I wanna say, like, maybe March or April of 2000. So let's do actually chronology a little bit, Adam, because I think that and, again, we wanna hear from other folks that that were kind of around this period of time. But the, so, I started working for Sun in 96. So, I feel that, like, it the the starting pistol for the boom has gotta be like Netscape, I would say, in 95. I don't know.
• 5:28
  What do you think? How do I I know I'm reaching back to your kind of high school years.
• 5:32
  Speaker 2: No. That that that's right. I don't know. I feel like the real go go days maybe weren't until 97, 98. But that I mean, I realized that this is, you know, rewriting of history.
• 5:43
  But, like, the time when it just so the my my lens for that is, you know, I started college in 1997, and there was certainly excitement. But as the the you know, my TAs and the folks, ahead of me were graduating, it was very, very frothy. But, you know, in, again, 98, 99. And maybe that's just I didn't see it quite as much in in, like, 97.
• 6:10
  Speaker 1: Yeah. I think it no. I think that's exactly right. I think it was definitely building. I mean, 98, 99, 2000 is definitely the height.
• 6:17
  And but I think that that run up kind of starts you you have a recession in 91. So the the the the economy is kind of, and I remember when I went to school in 1992, being kind of really with computer science, I'm like, well, this will be at least I will have a job, because there was I mean, I had so many friends who were several years ahead of me who were graduating and not able to find any job at all in 91, 92. So think
• 6:50
  Speaker 4: That's why I went to Grant.
• 6:51
  Speaker 1: Right. There you go. Right. And, always a good always a good option when the economy sours. So things are kind of slowly building over the nineties.
• 6:59
  And, Adam, you interned for Sun in 2000. Is that the summer of 2000?
• 7:05
  Speaker 2: That's right. Summer Okay.
• 7:06
  Speaker 1: So Right. Which We're at at or near the height.
• 7:12
  Speaker 2: Yeah. I mean, undeniably, like, you're right at or near the peak of of of hype there and of that Okay.
• 7:19
  Speaker 1: So what is some of the largest that you remember from 2,000?
• 7:24
  Speaker 2: Okay. So, first of all, the it this bit me hard in a weird way. So I joined Sun as an intern with my with my buddy, Pete Demeray, who I think is now at Meta. He was at Oculus. I love that.
• 7:37
  And, we could not put a roof over our house. Okay? So, like, lots of other interns were given housing. We were not. We tried to get it on our own.
• 7:49
  And, of course, there were I mean, talk about picks and shovels. Right? There were we could not get housed. My buddy, John Motor, who responded to this thread, was, like, between apartments. So he let us crash at his place for, like, that interstitial month.
• 8:03
  But we spent the better part like, the the first month of our internship, we mostly spent finding
• 8:09
  Speaker 1: I mean, the good news is, was it getting easier over time because you needed it for, like, actually, at this point, I'm only looking for housing for, like, the next 72 hours because my intern said.
• 8:17
  Speaker 2: No. No. No. No. Much worse.
• 8:19
  Because the landlords didn't wanna sign a lease for a month or 2
• 8:24
  Speaker 1: or 3.
• 8:25
  Speaker 2: They want it they wanted to lock you into a year lease. Like and the only way I got it was in, you know, eventually my my parents, like, cosigned and I had, like, power of attorney. Like, it was ludicrous what we went through, but it was literally, there was a day when we're like, we're going to need to sleep in the office if we don't, like, deliver the the jade monkey to this landlord. So that that was that that was when I sort of, like, understood how different Silicon Valley was, especially in that moment. But but maybe less less less perilously, we showed up, and I remember you came to office and said, you know, you can go to this fatbrain.com website and order whatever you book you want.
• 9:11
  And I you know, we were like, well, you mean, you know, that's relevant to the maybe too seriously. Like, I think, I don't remember what I got paid during the internship, but it it almost sort of, like, doubled its worth on the number of
• 9:30
  Speaker 1: Did you did you use that as a chip chip when you were negotiating a lease? You're like, look. Hold on. I can I can get you whatever book you want? It does that does that help sweeten the pot for but this, to get a roof over my head.
• 9:43
  Speaker 2: Yeah. So the I mean, from from my, like, you know, 20 year old eyes, it was all very strange. But, I mean, you must have I I mean, I can't even imagine, kind of what you saw leading up to that.
• 9:55
  Speaker 1: Well, it was definitely nuts. I mean, then you had, like, people certainly I mean, things were very, very overheated, it felt, and traffic was terrible. You know, hard to get housing and so on. For me and I think that, like, pets.com, I wanna say it was, like, April or something like that of 2000. So that was actually that had actually busted out.
• 10:19
  But but just like I think kind of the period we're in now, people looked at some of those early flame outs. I think boo.com was early. Pets.com was early. And people like, okay. That's obviously ridiculous.
• 10:30
  Like, everybody knew. Of course. Of course. Everybody knew that was gonna flame out, which is true that, like, when you have when when things really turn and expectations really turn, it's the stuff that the stuff that immediately capsizes is the stuff that was actually in trouble had been in trouble for a while. And if the even in a frothy environment was gonna really struggle.
• 10:50
  So and everybody I feel rationalized, like, no. No. That's not us. Like, we're picks and shovels. We're not you know?
• 10:59
  Speaker 2: Right. Right. We're we're real. Now one of the things that was very different about that time, and correct me if I'm wrong, was that there was this mad dash to IPO. So it wasn't just, like, the the folks at those companies who were exposed to it.
• 11:12
  It was really everyone, like, the broader public was participating in a way that they don't get to in in in the in the more recent froth. Absolutely.
• 11:23
  Speaker 1: Okay. But
• 11:25
  Speaker 4: And it wasn't just in the dotcom companies, Adam. I the I mean, you know, there are these are tech companies, but, like, I could've gone I had job offers from Cisco and Sun in late 1995 after having 2 years in NRL. And, hey, look, we built IPv6 and IPSec for BSD. A lot of more than a few of the people I would have worked with at Cisco left 6 months after I moved out. Brian, you and I started within months, maybe weeks of each other.
• 11:58
  And they all went to a little startup founded partially by some Xerox PARC and spent a little time at Sun People named Juniper Networks. I suspect you've heard of them. They went public, oh, God, before 2000, if I remember correctly. And all and that was, like, mad dash 2. Oh my god.
• 12:21
  Oh my god. We're building routers. Backbone people are buying it. You know? This is back when you could ask, who built your BGP?
• 12:28
  And the number of people on that list was countable in 1 or 2 hands. What? And one of them worked for Juniper.
• 12:34
  Speaker 1: Yeah. And and I think that there was a Mad Dash IPO. I think also I mean, Adam, in terms of, like, the broader public I mean, the the day trading was a thing. Right? And I feel that that there was this idea of these day traders that were, you know, people in their underwear trading these IPO tech stocks.
• 12:53
  I think that, actually, there isn't an exact analog to today with web 3 and cryptocurrency where you had broadened it to people who are you you these things these bubbles get kind of hyper frothy when expectations become so distorted that people don't think that they can't bust. And that, to me, is, like, a common theme between the dotcomboomandbust, thehousingboomandbust, and the the theboomandbustheweb3, I think, for lack of better word. Boom and the the the bust that we're about to go through is that people's expectations had fundamentally shifted. Things can't possibly bust, and then that distorted investment and activity. And that led to all the absolute nuttiness.
• 13:38
  And that is what that's part of the reason why I think things turn so quickly is because you have a decent number of people who are like, this can't be right. And I definitely remember at the time being like, this is, like, this is nuts. And I think that you're the I remember reading, like, Economist covers in, like, 1999 warning about the the the that things were too frothy. Remember thinking, like, you know, I used to agree with the economist, but now I I think it might be wrong. I think this is gonna go on forever.
• 14:07
  And the so the for me, like, the moment of that the actual bubble burst was not that kind of in the early the Nasdaq begins to correct in early 2000. There was this period where and I can't remember exact I would like to remember exactly when it was, and I think it may have even been the summer of 2000, but certainly by the fall of 2000, traffic got better. And that was super eerie, because it was kinda like you you had it was almost like, you know, you're in the commute, like, past the accident or whatever, and it's, like, super light. And but then that happened the next day. And then the next day, and everyone's like, was traffic light for you?
• 14:49
  Like, what's going on? What
• 14:51
  Speaker 6: did All all the .coms were shedding personnel because they were starting that like like, the bus was starting. Yeah. I I remember this. And it was it was this thing where this so, like, you you mentioned the history. I think it's important to go back to the globe.com.
• 15:05
  You're like, when do you date the beginning of the boom? To me, that was the beginning of the boom.
• 15:09
  Speaker 1: It's the globe because they IPO
• 15:10
  Speaker 5: ed and went to, like
• 15:12
  Speaker 6: yes. Yes. Because they IPO ed and their valuation went to, like, $2,000,000,000 in the 1st day. And it was like something that 2 guys were running out of their dorm room, Cornelius. What is the globe dotcom?
• 15:22
  Speaker 1: I don't even know what the globe dotcom was or is.
• 15:25
  Speaker 6: It it it was some, like, stupid portal thing. And, you know, it but but it was, like, people got, like, really into it. And and it was one of these things where, you know, a a bunch of people see that, like, the globe.com's valuation with $1,000,000,000,000. And, like, oh my god. Like, there's money here.
• 15:39
  I have to get in.
• 15:40
  Speaker 1: Yeah. Interesting. So they are just, like, from the the the the Wikipedia article here on the globe.com. So, yeah, founded in 95 and IPO'd in 98. So, yeah, Dan, I can tell you.
• 15:49
  So you're saying so that's when, like, the boom goes kinda nonlinear after the the globe. Com or about that tone.
• 15:55
  Speaker 6: Yeah. Yeah. I mean, like, because think about it. Right? It it's people look at this and they're like, this is dumb.
• 16:00
  I I remember looking at the World Wide Web in 1990, like, 2 or maybe 3 and being like, this is this is stupid. Like, there's no utility in here. Nobody like, this isn't gonna go anywhere. This is dumb. The technology's right?
• 16:12
  Boy, was I wrong. But, you know, but like like like the globe legitimately was dumb. I mean, it was it was a stupid idea.
• 16:19
  Speaker 2: And and yet Pete and yet all of
• 16:20
  Speaker 6: a sudden these these guys had, like, $2,000,000,000 and it's you know, and and you just you imagine all these like Wall Street sorta like middle finance type people that are like, I'm gonna go start a company and make a $1,000,000,000 in, you know, doing technology stuff. And and and, you know, pretty soon that becomes unsustainable circa 19 you know, early 2000. Right? And I remember the
• 16:45
  Speaker 2: the company I worked for
• 16:46
  Speaker 6: at the time laid off their entire engineering department. Or or I I I had just left this place. Like, a month later, they laid off all the programmers. And they said, well, now that we've completed our technology investment, we no longer
• 16:57
  Speaker 1: Oh, there you go. That makes sense.
• 16:58
  Speaker 2: Makes sense. Wow. I feel like at least they had the globe.com. So
• 17:05
  Speaker 5: now it's just pictures of monkeys. Like, what I mean,
• 17:09
  Speaker 6: I Hey. Like, it's even less this time. I have you know those monkeys are smoking some primo shit. Okay?
• 17:15
  Speaker 1: Exactly. I think they're about the same. I have to say about about the same. I'm not sure that
• 17:19
  Speaker 6: No. No. No. I mean,
• 17:21
  Speaker 5: I feel like the globe.com had more utility than the monkey pictures. I I mean, call me crazy.
• 17:27
  Speaker 1: It it is now defunct. I don't know. It's hard to say. The about to say I mean, I think all of these things distort investment. Right?
• 17:33
  You end up with with things being, invested in that should not be invested in. So did you so, Dan, when was your entire engineering department laid off? When was that?
• 17:43
  Speaker 6: So I had jumped ship in, like, June of 9 or or June of 2000,
• 17:49
  Speaker 3: and it was, like, a month
• 17:50
  Speaker 6: or 2 later. And it was, you know, it like, this is New York City. Right? This is not Silicon Valley. It's a much smaller tech community.
• 17:57
  And, you know, like, I had friends at this place. And when you know, I get this, like, phone call from a guy with Danny. He's like, dude, never gonna believe what just happened. And I'm like, tell me. He's like, they just took all the programmers in some conference room and fired them all.
• 18:09
  Wow. It was like, It also became one of these things where it was like, it was almost gleeful in some sense. Like people knew they were gonna get, like people like like, people who were working in technology understood that this was these ideas were dumb. They weren't gonna go anywhere.
• 18:26
  Speaker 2: Yes.
• 18:26
  Speaker 6: You know, you had business people who had no idea what the Internet was about or how it worked or anything, and then, you know, they were trying to, like, grab onto that really large pie, which turned out to not be all that big. And and and and they were just like, oh, you know, hey, gee. We're we're not making money anymore, and we're bleeding we're bleeding cash because we have these amazing office spaces in Midtown Manhattan or whatever.
• 18:50
  Speaker 2: What do we what do we do?
• 18:51
  Speaker 6: It's like you fire all the programmers. Who needs those idiots?
• 18:54
  Speaker 1: That's the problem solved. But I I I feel like there is this period. And, again, I would love to know exactly I'm sorry. I remember it. And I feel it's like through the kind of summer fall of 2000 where the things that were I mean, you had companies that were, you know, laying off all the programmers thinking that they were kind of positioning themselves for success.
• 19:10
  But we we were calling it the correction. Like, Adam, did you do you remember us calling it the correction?
• 19:17
  Speaker 2: Yeah. Yeah. Absolutely. But but they've called I mean, correction if I'm if I'm
• 19:21
  Speaker 6: correct if
• 19:21
  Speaker 2: I'm wrong, but is a technical term meaning, like, a 10% drop in the stock.
• 19:25
  Speaker 1: Yeah. I mean, there there's the technical definition of a correction, but people called it the correction. Like, it is there was this idea of, like, yes. There was this froth. We're gonna correct that.
• 19:34
  And I think we one of the big lessons for me from the dotcom bust is the l so the elevator's in free fall. So it doesn't stop at the ground floor. You think it will, but it won't. Like
• 19:47
  Speaker 2: or at least what you thought was the ground floor is is Yeah.
• 19:50
  Speaker 1: Exactly. And so, like, the idea of, like, we're gonna just gonna kind of, like like, there is no such thing as a controlled burn in Silicon Valley. Like, we only do conflagration around here. We we only let fuel load get way too high, and the the the longer you let the fuel load the build, the hotter and longer it's gonna burn. And I I feel so that you had and I for me, I remember the because you go kinda through the summer 2000, it's kind of the correction, and traffic is better eerily.
• 20:20
  But, you know, Adam, we're we're kind of overall participating in this group illusion that we're picks and shovels. I for me, the absolute tip top was September of 2000. I was at a dinner with, a bunch of folks from Morgan Stanley. Morgan Stanley spent, I think, like, $850,000,000 in IT infrastructure that year, which is a lot. And I bought a ton of sun gear, and there were I remember there were 19 of us.
• 20:48
  And the, we are just like eating like 19th century robber barons. I mean, it it it it it it it it it
• 20:58
  Speaker 2: it it
• 20:58
  Speaker 1: it it picks and shovels. We are eating like Oaks Ames, that so called king of fame. That's true. We are no. We really are.
• 21:04
  I mean and it is like we I mean, did you ever look at, like, a, like, a 19th century menu that from from the Gilded Age? And oh, and so these menus just like how many they're like 15 courses here. But so I it it it we are and in particular, at the at the end and we're at Aqua, San Francisco restaurants. You're pretty good at Aqua?
• 21:22
  Speaker 2: Yeah. Yeah. Fantastic.
• 21:24
  Speaker 1: Yeah. Aqua. Did you say it's fantastic? You actually did it fantastic?
• 21:27
  Speaker 2: Yes. Yes. I really do.
• 21:29
  Speaker 1: Do you think you can defend that? I absolutely think it's overrated. I thought that was, like, a New York restaurant that was, like, class playing as hard as you go. And in particular, they used to I just remember that they were I mean, the waiters I mean, god the waiters, like, make hay when the sun is shining, were pounding us through wine. So, like, every wine glass is being filled all the way to, like like, the tip tip top.
• 21:49
  Like, it's a cup of coffee. And the and I'm not, like, a lightweight to begin with. So, like, I'm drunk, and we are at the end of the meal, the one of the Morgan Stanley folks orders Chateau D'Qim, which is a sauterne. Like, 1955 Chateau D'Qim, which and I like, I'm not a wine drinker. I don't know.
• 22:11
  All I know is like, this is like a $1,000 a bottle. And we just start burning through it.
• 22:19
  Speaker 2: Best best enjoyed by Chateau.
• 22:21
  Speaker 1: Right. Exactly. So I literally I've had chateau dikem, but I don't really remember it. I mean, I was, like, blacked out, and I definitely remember. And the the the bill for the 19 of us was over $20,000.
• 22:35
  And I remember getting home, and it's, like, 2 in the morning now. I'm in my apartment in San Francisco. I'm just thinking, like I'm I'm, like, drunk. I'm literally drunk on literal Chateau Dakeem, and I just remember so vividly thinking, this can't go on. This has to stop.
• 22:53
  And and I swear that is the moment because I control time and space in my mind. That is the moment that everything stopped. And
• 23:00
  Speaker 2: the And this is, like,
• 23:01
  Speaker 1: September of 2000.
• 23:03
  Speaker 2: 2000.
• 23:04
  Speaker 1: And I November of that year, November of 2000, the telcos all imploded. And, like, literally, telcos did not order. Telcos had been ordering tons and tons of infrastructure, and they all simultaneously stopped. And there were, like, no orders in November. And then everything just went into absolute free fall, and it was layoffs.
• 23:28
  And and and you you're still kind of, like, trying to convince yourself that, like, maybe it's not that bad. But then, Adam, you start so you had offers because you're back at school now.
• 23:37
  Speaker 2: Yeah. So this is the reason. So you're you're off at this Busy dinner. I'm back at school, and and and me and my friends are all interviewing for jobs, like in November, December, January, you know, November, December, 2000, January, 2001. And we kind of don't catch away from this.
• 23:55
  Right? Like we know that Silicon Valley is imploding, but nobody's pausing. Right? Like nobody's saying, actually don't come fly out. Like, we don't have any positions for you.
• 24:05
  Speaker 1: Because we're in barrels.
• 24:07
  Speaker 2: No. Everything's saying go, go, go. And may maybe they're also thinking, hey, we can we can get these cheaper employees in or something like that. But even companies like Trilogy, I don't remember what that
• 24:18
  Speaker 1: Oh, Trilogy.
• 24:19
  Speaker 2: But like Yes. Yeah. Yeah. Yeah. Like, very eager to get, like you know, took everyone to the nicest restaurant in Providence, Rhode Island and eager to get everyone out to Austin to to interview.
• 24:32
  So Trilogy is Go go.
• 24:35
  Speaker 1: Trilogy is infamous, though. Did you go out to Austin with Trilogy?
• 24:38
  Speaker 2: You know what? I didn't. I actually
• 24:40
  Speaker 1: That's a lost opportunity.
• 24:41
  Speaker 2: I I I know. No. I know. Is it a huge lost opportunity? At that point, I had the offers that I was serious about.
• 24:49
  A buddy of mine who had gone to Trilogy had, had, like, he it turns out, like, he had needed to get, like, his insurance, certification or something like that. And, it took us some, like, peeling back of layers, but it turned out he was just miserable. So, I decided not to go to Austin. And and the recruiter was like, you know, we paid for the trip. I hear that you don't wanna work here, but you should just come anyway.
• 25:17
  And it it took a lot of convincing that I had, like, not left anything at Trilogy. Like, you know, we just didn't see each other anymore. It was over. But, no, I didn't go to Austin.
• 25:27
  Speaker 1: Because they so trilogy famously was was paying a lot. They were overpaying, honestly, for Yeah. And they apparently, this is not apocryphal, but as part of the, like, trilogy orient the the orientation, you would go to Vegas and they would force you to bet a $1,000 of your own money on roulette.
• 25:46
  Speaker 2: Yeah. That's that's yeah. Definitely what I've read and what I heard from from this guy who again worked there. Is this a crime organization?
• 25:53
  Speaker 1: They're out of business. They I mean, and what was the trilogy what was that like? Are they they're not trilogy systems, trilogy software? What were they? They were a consulting goober.
• 26:03
  Right?
• 26:04
  Speaker 6: I would say no more. During the dotcom boom, it it look. If you're gonna talk about the boom and the bust, you have to talk about these scummy consultants.
• 26:12
  Speaker 1: Yes. Which I think Trilogy is the name of his ultra yeah. Go ahead, Dan.
• 26:17
  Speaker 6: Oh, I mean so we worked with a company called Science at one of the startups I was at, the one I joined in 1999. And, you know, speaking of Sun, like like, part of the reason if it's it it you bought like a 1,000 cheapos Intel boxes and through Linux on them.
• 26:44
  Speaker 1: Oh, by 99. Okay. Yeah. That's early. Yeah.
• 26:46
  Oh, yeah. For sure.
• 26:48
  Speaker 6: Absolutely. And, like, you know, companies like science would come into a startup and be like, no. You need to go buy, like, a shit ton of sun gear. Go buy an, you know, an E45100. But, you know, the boo.come10k.
• 26:59
  I understand why they bought that. They're probably, like, told by
• 27:02
  Speaker 2: some consultant. You buy this,
• 27:04
  Speaker 6: you put 1 CPU board in it, but now you have space to grow.
• 27:07
  Speaker 1: I need my Chateau de Kim, Dan. I need my Chateau de Kim. The Chateau de Kim is not gonna drink itself.
• 27:23
  Speaker 4: Thousand. We at FireSale hired a bunch of exco engineers in Watford, UK.
• 27:30
  Speaker 1: Yes. I remember that. I and we were so desperate for people that we were hiring folks on on mass, sight unseen. I'm so there were some there were some good
• 27:39
  Speaker 4: ones in there. Don't get me wrong. I enjoyed the I enjoyed talking to those Watford guys and you know? But it was like they were sending 1 Solaris network technology engineer a week out there, and I got to go in, God, September sometime.
• 27:55
  Speaker 1: So the so, about this so, Adam, you are this trilogy so you you managed to to not take your trip to Austin, which would have given you a lifetime full story. So, you know, obviously, no mistake. Missed on And now last for a year. How do you compare that to not having the Juicero backpack in terms of, like, your your life's mistakes? How do you rate this?
• 28:14
  You know,
• 28:15
  Speaker 2: I think I think that probably that recruiting trip would have been indistinguishable from others, which is, like, some whiteboard
• 28:21
  Speaker 1: I agree.
• 28:22
  Speaker 2: Doing, like, some boozy dinners. But like the Juicero backpack would have been something I I give to my kids and they give to their.
• 28:29
  Speaker 5: I agree.
• 28:29
  Speaker 1: I thought no I agree. No. I that's the way I see it
• 28:31
  Speaker 2: too, but I just wanted to
• 28:32
  Speaker 1: get your
• 28:32
  Speaker 2: but but on the other hand, nothing for, like, the the descendants to fight over. You know? Like, who's gonna get the back
• 28:38
  Speaker 1: It's true. The the juice brew backpack locked up in probate court among your your warring children. The alright. So you, but you don't go to Trilogy, and then, what's happening to folks back at school with offers?
• 28:52
  Speaker 2: Oh, so so so then, you know, offers are going out, but we're also hearing people walking back offers. And and like offers getting rescinded, offers getting delayed in particular, as in in, in the financials, like, you know, at that time, maybe it's still true. I think it was just at that time, the sort of like, if you didn't know what you wanted to do, you didn't go to law school. You went into financial services as, like, an investment banker.
• 29:23
  Speaker 1: Yes. Don't say I banker. Yeah. Right. Like, that's I just put the fact.
• 29:27
  Speaker 2: I mean yeah. That's, like, sort of what you did. And, like, I guess, there was lots I mean, there were briefly lots of jobs for those folks, and, then lots of folks who got those jobs got told, actually, like, you can come 6 months later or not at all.
• 29:44
  Speaker 1: Yes. And my as my sister started working at Morgan Stanley in 2000, and so I can definitely confirm that. She felt like she was the last in the door for sure. Things definitely changed in 2001. And I just remembered your offer at Sun.
• 29:59
  The we had to fight for that offer. That was not an easy by that point in time, we there have been a hiring freeze, and these things are always way too blanket. And we and I think Sun was kind of panicking. So I I just remember us having to escalate quite a bit to get to to be able to make you an offer. I if I recall correctly, it was the next year that was it it so when we were hiring not 2,001, but 2,002, that's when it required, like, a an act of congress to hire someone.
• 30:30
  That was really, really difficult. Well, when I did so I showed up
• 30:34
  Speaker 2: and into a bunch of layoffs.
• 30:36
  Speaker 1: Yep.
• 30:37
  Speaker 2: So, you know, this now, like, September, October 2001. Yeah. I I remember going to, like, some party where I met with someone who had graduated a year before me. I said that I started at Sun, and she said that she and her whole group had just been laid off. And she was pretty pissed off at me that I had just been hired into this company.
• 30:57
  Speaker 1: I just laid yeah. Laid her off. Yeah. I'm brutal. Brutal.
• 31:01
  And 911 happened.
• 31:04
  Speaker 5: Yeah. Abs Which
• 31:05
  Speaker 1: did didn't I mean, which was I I mean, on the one hand, like, unrelated. On the other hand, doubt, I feel served as an accelerant. I don't think that it would have
• 31:14
  Speaker 6: Oh oh, yeah. It it absolutely killed I mean, like the correction had started the year prior, but and and again speaking from New York City, like when 9 11 happened, it just everything came to a halt. Yeah. Right? And and it just absolutely killed a large chunk of what you know?
• 31:34
  So we didn't have Silicon Valley.
• 31:35
  Speaker 2: We had Silicon Alley, which
• 31:36
  Speaker 6: people thought was clever and I thought was dumb.
• 31:39
  Speaker 2: But, I mean, all of the little
• 31:41
  Speaker 6: sort of dot com y type companies that were holding on through through the to the correction were just like, okay, that's it. Like, we're done.
• 31:48
  Speaker 1: We're done.
• 31:49
  Speaker 6: And and it was yeah. That led to a multi year, like, you know, basically, drying up of the desert and the New York took.
• 31:56
  Speaker 1: Yeah. And I feel that also, like, aside from kind of the infinite sadness of 9 11, I also feel that it really it it kinda fundamentally changed expectations. Like, if you had expectations that of the sync being over quickly, all of a sudden, your forward expectations were just, like, a mess. And I think that whatever possibly I I I definitely get, like, total capituation, whether it's due to 911 or accelerated by it. I feel like once you hit in the end of 2,001 going into 2,000 2, you are at total capitulation.
• 32:27
  Speaker 3: You're right.
• 32:28
  Speaker 2: That's right. You you just people not think people recognizing that this isn't a brief dip and it's all gonna come back. Right. But, like, the it's just gonna be more of the same.
• 32:37
  Speaker 1: It's gonna be more of the same. And the and Theo, I saw you becoming a speaker here. I can't remember, Eddie, because, I mean, you obviously also had a front row seat for this stuff. What do you remember of the of of things kind of busting out? Sure if Theo is there or not.
• 32:54
  I'll put Theo on mute when he when when he can. But, because I remember I mean, Theo also was I mean, we're all kind of the same vintage and watching things effectively bust out. The I'm trying to remember because, Adam, I feel the one thing I definitely felt, and this is a little bit morbid, but I felt much more clarity in the bust than the boom. Like, about what we were doing.
• 33:19
  Speaker 2: You mean in terms of, like, the utility of of, like, concretely list the work we were doing?
• 33:25
  Speaker 1: Well, I just remember, like, there were many fewer stupid arguments. It just felt like things felt like they were so desperate.
• 33:35
  Speaker 2: Well, you know, I I only came we I mean, I really only sort of woke up after the bust. So, I feel like we have plenty of stupid arguments, so I can't even imagine how many
• 33:45
  Speaker 1: stupid arguments. Oh, god. You think you think those are stupid arguments. You stupid stupid arguments.
• 33:50
  Speaker 2: I feel like it's the the governance model of sudden was mostly fueled by stupid arguments.
• 33:54
  Speaker 1: Oh, and I'm just saying that that is that that is, like, a tenth of the stupid arguments that I feel that we I mean, not a 10th. But I feel that that we one of the side effects of really focusing people on just survival, which is on the one hand, stressful. On the other hand, there's a bunch of, like, there's a bunch of shit that just goes away. You know, Sun had a director of volleyball. I don't
• 34:21
  Speaker 2: know. No.
• 34:23
  Speaker 1: No. No. I just heard, like, there's these volleyball games being organized in this, like, I mean, on the one hand, like, alright. I like a you know, look, I like volleyball. I'm just like I'm I'm at work right now.
• 34:32
  Speaker 6: Saying it shouldn't it shouldn't
• 34:33
  Speaker 2: be covered by the the d and l. Your directors and officers.
• 34:37
  Speaker 1: There there was a what is now meta? Do you there was like a, like, a health club.
• 34:43
  Speaker 2: Yeah. Yeah. Like, building 19.
• 34:44
  Speaker 1: Yeah. Did you ever go over there?
• 34:47
  Speaker 2: Yeah. I did once.
• 34:48
  Speaker 1: I feel like you because you and Pete were availing yourselves of all fringe benefits, I feel if anyone would've gone over there did you wait. Did you ever play volleyball?
• 34:57
  Speaker 2: Not at only in sun, in Prague. Not
• 35:02
  Speaker 1: not. Okay. I just remember, like, so much, like, pressure to join. This guy is, like, clearly upset that people are not playing lunchtime volleyball. And there's, like, this, like, constant mail going out to the entire company.
• 35:13
  I just started, like, looking this guy up on the org tool and be, like, what is up with this, like, volleyball guy? And it's like, he's a director. He's a director of volleyball.
• 35:23
  Speaker 2: No. We were probably looking at the the gym to see if we could sleep.
• 35:27
  Speaker 1: Well. It's like that's what makes you is there a part of the volleyball court that's, like, that's sheltered a little bit? We just need to get
• 35:34
  Speaker 2: Like, what's the comfiest
• 35:35
  Speaker 1: part of music? I I I was
• 35:37
  Speaker 2: so I was looking back at, like, the offer materials from Sun, and one of the most, like, amazing things in hindsight, like, it was ludicrous in the moment. But the way that Sun and all these companies talked about their stock, talked about their stock like like it could only grow. And if it was only growing 10% a year, then your stock sucked. And, like, this included conversations with the recruiters saying that stock options that were priced higher were worth more. Because if you think about it and they and it grows 15% every year, then what you really want is the stock options that have a very high strength.
• 36:17
  Of course. Wait. And I I did not take any economics in college, but that that just didn't really seem to have right
• 36:25
  Speaker 1: to me. I'm not sure about the map. Hey. Well, you know what? Picks and shovels, man.
• 36:29
  Speaker 6: This person
• 36:30
  Speaker 2: this is a pro. Right? Picks and shovels. Right? King of spades knows what he's
• 36:34
  Speaker 1: talking about. Exactly. So do you remember there was a, billboards on the 101 were like the hot property?
• 36:42
  Speaker 2: Yeah. Absolutely.
• 36:42
  Speaker 1: And the, but everyone begins to capsize and disappear. And you've got companies that are dying, but they've rented their billboard on the 101. And do you remember the garden.com billboard? No. So the garden dot so garden.com was a, like, a definitely a dot com flame out, and they're selling, like, gardening supplies online or whatever.
• 37:04
  And garden.com had which is probably a bad use of society's scarce resources. They took a billboard on the 101, already arguably a bad idea. And they they had it covered with greenery, like, actual greenery, which is, like, I mean, I don't know. I guess, kinda nice. It was on the 101, like, by Redwood Shores where you got, like, all those billboards in a row, if you remember where that is.
• 37:25
  Speaker 2: Yeah. Yeah. Like, we're all where people post their billboards to to tweak or
• 37:30
  Speaker 1: Yeah. Exactly. The look. Look. In that neighborhood.
• 37:32
  Not exactly where that is. Yeah. In that neighborhood. And the, the the so garden.com capsizes, and so they are no longer able to, like, water the plants on their billboard. And it was this amazing metaphor.
• 37:45
  And I like, so over, like, the months, these plants just, like, wither and die, and they look like graphic. And I just remembered, like and then but the the lights are still on in this thing. So you pass this thing, the lights are on, and it's, like, all these, like, dead branches around this garden. It's, like, wow. This is very telling.
• 38:03
  And finally, someone is, like, turn off the lights on that thing. And so it was just, like, like, dark The word. Because the topic You
• 38:11
  Speaker 2: know you know, one of the, sad moments going into the Oxide office, like, at the at, like, the worst of the pandemic was going in and, like, the plants we had bought just, like, unwatered dead. And I feel like, you know, a a microcosm of that same symbol.
• 38:27
  Speaker 1: Right. Yeah. No. Dead plants. It's a the plants are dying.
• 38:30
  This is definitely you've lost a birdsong here, it definitely was, so and I remember that I mean, there were, buildings there were a lot of people who had buildings they were gonna build and that all stopped. And one of the things that was also kind of educational as this stuff all unspooled is you have everyone kind of, like, is just gonna bat in the hatches and things that can survive. But when they bat in the hatches, they they pull in a bunch of spending that has all these knock on effects. So, you know, the event planners all capsized and all of the, you know, real estate, commercial real estate went from absolutely unavailable to just a total surface of commercial real estate.
• 39:12
  Speaker 7: Yeah. So, I mean, my perspective on this was, definitely from an the other side of a pane of glass. Because, I ran a consultancy, and we had lots of clients that well, we had lots of clients that survived because all the clients that didn't fired us. So, but I I I entered the industry in, like, 96 and, definitely had a whole bunch of college roommates that went to work for Trilogy. So to quickly recap, from my secondhand experience of that is that, yes, they did require you to gamble.
• 39:49
  It was roulette. Everyone had to gamble a $1,000, but it wasn't your money.
• 39:53
  Speaker 1: That's crazy.
• 39:54
  Speaker 7: And it was all on different squares, so there was a guaranteed winner.
• 39:57
  Speaker 1: Okay. I thought you said it wasn't your money. I don't know why it wasn't.
• 40:01
  Speaker 7: They they supplied you a $1,000 and made you made you bet. But but only one person walked away with the the the pot.
• 40:08
  Speaker 1: And what's the theory behind that? What's the what's the man what what is the Harvard Business Review article describing this managerial technique?
• 40:17
  Speaker 7: I think that they wanted to make sure that everyone there was comfortable taking absolutely stupid risks.
• 40:23
  Speaker 1: Alright.
• 40:24
  Speaker 2: I think the other side of that too is that it makes, you know, one of those, whatever it is, 32, is a winner. And, like, everyone gets to tell the story about Dave who won the $32,000. Exactly. Took everyone what? And took everyone out to drinks.
• 40:43
  Right? Like, I think it's the the it's both the risk everything and the survivor bias of the winner. Right.
• 40:52
  Speaker 7: And I I will say that that not not being in a product company, I it felt like the the bust was, prolonged for us. I mean, it definitely happened in 2000, but but it really didn't finish until about 2002, because all of those companies that pivoted and believed they could survive survive, they they they could hang on to us sometimes as much as 2 years
• 41:16
  Speaker 1: Right.
• 41:17
  Speaker 7: While they were doing it. And I remember when I realized that everything was really, really done was probably in 2000 2 when I was sitting in a due diligence meeting, and, the CEO of the company that I was doing due diligence support for with I wanna say it was Goldman Sachs, but it might have been Morgan Stanley, took me aside and said that they would issue me a personal loan to convert my options. And I was like was like, that is the worst effing idea I have ever heard in my life. We have jumped this, you
• 41:58
  Speaker 1: know, jump the shark. But that wasn't too that it can do though and continue
• 42:01
  Speaker 3: to do that stuff
• 42:02
  Speaker 2: too. Right?
• 42:04
  Speaker 7: That was too I don't know. It sounds
• 42:05
  Speaker 2: rev sounds revolutionary to
• 42:07
  Speaker 1: me. It We should
• 42:08
  Speaker 2: get more companies to do that right now.
• 42:10
  Speaker 6: Yeah. Exactly. Ryan Broslow should write a blog post about this.
• 42:13
  Speaker 1: Stop. Stop. Stop. The Ryan King. Yeah.
• 42:16
  I mean, it is amazing how it now another generation needs to learn what an unbelievably bad idea that is. But, Theo, I'm amazed that was in 2002 when I feel like we were kind of like
• 42:25
  Speaker 7: March of March of 2002.
• 42:27
  Speaker 1: Because I feel like we we kinda got post capituation. So I I also think, like, the bust went on for way longer and went on for a, I felt, like, a very long and we just got to the point where it's like, this is the new normal. The new normal is, like, tech is not whatever and not people are not coming here seeking riches. They are no longer day trading. They are not thinking about, you know, they're they're not day trading on their their IPO.
• 42:52
  And the new normal is that that tech is, just a part of the economy. It wasn't Yep.
• 42:58
  Speaker 2: Yeah. And and another data point from, from, you know, then a student and then recently graduated student was when I left, the intro to computer science classes were the biggest they'd ever been needing to spill over into multiple classrooms. Continued to decline. So
• 43:20
  Speaker 6: That's a really important point. I mean, bear in mind that when
• 43:23
  Speaker 2: when the boom was happening,
• 43:25
  Speaker 6: I like, I had a friend
• 43:26
  Speaker 2: who was working at one
• 43:27
  Speaker 6: of these startups who said, any idiot who
• 43:29
  Speaker 2: can spell IP thinks that they can get a job as a programmer.
• 43:32
  Speaker 6: And so you had this glut of people who,
• 43:34
  Speaker 2: you know, like, bluntly just weren't very talented. They weren't they weren't good programmers. They didn't necessarily know what they were doing.
• 43:40
  Speaker 6: And, you know, but, like, there was
• 43:42
  Speaker 2: just such a demand for for warm bodies filling seats that almost anybody could get a job.
• 43:48
  Speaker 7: And then it's like, today
• 43:50
  Speaker 6: played well yeah. Exactly. And this is, you know, the web briefing.
• 43:54
  Speaker 1: Well and so it'd be interesting to track that metric now, Adam. Certainly, we're back I mean, computer science is by far the biggest course on every campus.
• 44:01
  Speaker 2: It's huge right now. Something I I I have this data in front of, somewhere on my computer, but something like a quarter of Brown graduates are have, like, taken a computer science class or in some sort of partial major. I gotta go pull those data up, but the the number is staggering.
• 44:18
  Speaker 1: And so do you feel that this bust changes that, this coming bust? I I
• 44:24
  Speaker 2: mean, that's that's gonna be really interesting. I think in particular because, I think I think some of the hype was sort of so narrowly focused. And and one of the things that's very different now is I I feel like I have a much better read on venture, and I really did not at all. I have no idea what it looked like. I mean, do you have any sense of that?
• 44:45
  Like, did you did you were you plugged in to to venture in like, through the bust?
• 44:51
  Speaker 1: The only in an ancillary fashion. So, I mean, obviously, I was not an entrepreneur, but not you know, we were but we played ultimate with venture capitalists. That's Well, there you go. My my connection to venture capitalists was like the fact that we, and, certainly, if you look at the firms that started in, like, 2005, 006, there were a lot of bootstrapped companies. VC was got cratered, and people picked their winners, and there was not a lot of new investment, I mean, just by the numbers.
• 45:25
  I I feel like the the the have you read the hard thing about hard Adam? Yeah.
• 45:29
  Speaker 2: I have. But it's been a couple of years.
• 45:31
  Speaker 1: The horror what's the story there is pretty amazing. He's on the roadshow. I I and the, I just, like, everything coming unglued while he's trying the IPO. He needs an IPO to make payroll. And I feel like that's, you know, that kind of generation.
• 45:46
  It's another, you know, 5 to 10 years older than me. I am, anyway. And I so I did not endure that, but I I think that I mean, it was bad from I mean, it was really, really bad. You had all of these companies that were being that were, you know, your term sheets getting pulled, you had capital calls that have been made. I mean, all these kind of, like, things that supposedly can't happen again.
• 46:08
  But I I do fear that that's where I'd love to If other folks have ever kind of were either raising then or had raised, it'd be great to get your, your experience. I mean, it was it was brutal though. I think it's the it's the short answer. Matt, you
• 46:20
  Speaker 2: got your your hand up.
• 46:24
  Speaker 8: Yes. So, I just wanted to, quickly offer, yeah, my perspective on on the, yeah, the boom and bust from outside the valley, because so I was I started college in fall of 1999 when the boom was well underway. And the the the thing that I most distinctly remember that that affected me and various things that I was involved with were the free, the the free hosting services that were you know, like, for hosting a website or or streaming audio, that were available online during the boom. And then by 2,001 and definitely into 2,002, they were they were, you know, trying to push everyone to pay or or or suffer ads.
• 47:13
  Speaker 1: Yeah. Matt, what was the thing that, like, you could they gave you a computer to watch ads? Do you remember this?
• 47:19
  Speaker 8: All advantage dotcom. Well, the the the one I remember was alladvantage.com, which was some kind of, like, browser add on or something that would that would pay you to, to watch ads, but I'd a free computer
• 47:35
  Speaker 1: You know, I feel like
• 47:36
  Speaker 8: something the free computer.
• 47:38
  Speaker 1: Free.com. I think there was something that was,
• 47:41
  Speaker 8: There was, of course, net zero.
• 47:44
  Speaker 1: Yes. Net zero, I mean, ironically named. Wait. And, actually, I remember, I mean, the, the excite at home also cratered. And I remember do you remember their building, Adam?
• 48:00
  Speaker 4: Where was that?
• 48:01
  Speaker 1: I used to be They had a building they they had
• 48:04
  Speaker 4: a people at home before the merger.
• 48:06
  Speaker 1: Oh, yeah. We right. Right. So they right. It was at home and then excite so they became excited home and that
• 48:12
  Speaker 4: went starting VC put them together. That's what I wanna
• 48:16
  Speaker 1: know. Tom Jermalk, former CFO. Yeah. Exactly. The That's right.
• 48:21
  Speaker 6: That's right.
• 48:21
  Speaker 1: If you if you someone had had, there's a great business week article on the the g wiz company at SGI, looking at the downfall of SGI. And Tom Germanlock was the that that's the answer to your question. But the the I just remember going from a field, like, nothing, to a building, to a totally full parking lot, to a totally empty parking lot, to a building with, like, broken windows that no one was occupying, and all that felt like it happened within 24 months. From, like, field to, like, derelict building happened just remarkably quickly over probably from 2000 to 2,002.
• 49:02
  Speaker 8: Oh, another big thing I remember on the consumer side of this was all of the free phone call providers. Because, remember, 1999, 2000, you know, making long distance calls on a landline actually cost and, yeah, Delta 3, and Right. Dialpad.com and, yeah, Delta 3 and, I I forget the others, but, and and by by late 2001, they they were they were, tight you know, they they were, you know, they were tightening things up and imposing ads or whatever.
• 49:45
  Speaker 1: God, paying for long distance is such a a timepiece, I feel.
• 49:49
  Speaker 2: I just like Even the term long distance. The term long distance. A AT and T is alive and well and fleecing people for 100 of dollars for calls to this day for what they describe as long distance. They're the phone company. They don't have to care.
• 50:06
  Speaker 8: What? You mean that's still a thing?
• 50:09
  Speaker 2: Oh, yes. I just received the bill. Like, I I made a call to some it just it's all phone companies are from another time.
• 50:19
  Speaker 8: But, I I I remember that by late, you know, late 2001 was when we we really started to feel it as consumers. And, I particularly remember there there was this whole Shoutcast Internet radio, you know, audio streaming, scene that I was into back then. And there was a website called shoutclub.com that had a directory of these online stations, and I forget what else. And in December 2001, the auth the the the owner of the website posted an article called waking up from the dream of free Internet.
• 50:59
  Speaker 1: Oh, this is this is the rip good times
• 51:03
  Speaker 6: Yeah. For
• 51:03
  Speaker 7: for free Internet. For for
• 51:06
  Speaker 8: at least for for this little piece of the of the bubble.
• 51:09
  Speaker 1: Okay. And so, Matt, did you go to fucked company at all? The fucked company dot com at all? I feel like that, Okay. That I feel like was that was a common thing though.
• 51:17
  Right?
• 51:17
  Speaker 7: Oh, yeah.
• 51:18
  Speaker 1: That was
• 51:18
  Speaker 2: that was everyone's homepage. Yeah. Yeah. Yeah. Yeah.
• 51:20
  Speaker 6: Oh, that was so fun.
• 51:23
  Speaker 1: Yeah. Because there is this kind of, like, schadenfreude phase of the bus. Maybe it didn't actually end that Schadenfreude phase where
• 51:31
  Speaker 5: What's that what's that my wonderful journey
• 51:34
  Speaker 6: blog thing?
• 51:36
  Speaker 1: Right. But they which on the one hand, you I mean, if there's something that feels like the the the even though it's not truly wicked, but the way that there does feel like there there there is there is justice is being served by the economy. The problem is there's lots of, like, collateral damage. But I definitely remember going to fuckcompany.com quite a bit,
• 51:56
  Speaker 6: and Oh, I'll I'll I'll do one better than that. So at one of the startups I worked at on 23rd Street, across the street was this nice Irish bar where we'd all kinda hang out after hours. And in the building where our offices were, on some other floor, there was some other company that was pretty well known.
• 52:11
  Speaker 2: I can't remember what they are are were now. It was some sort of online gaming type thing or something. And they basically went belly
• 52:17
  Speaker 6: up one day. And so they all just, like, left and decamped to the bar, then we showed up. And it it just became this enormous, just like,
• 52:27
  Speaker 2: you know, nowadays, they'd be all
• 52:29
  Speaker 6: shit posting on Twitter, but we were just, like, talking shit about the places where we worked. It was wonderfully it was wonderfully cathartic and fun. But, you know, we all, like, basically had this drunken thing, and everybody was like and these guys are like, alright. We won't see you tomorrow, you know, in the elevator or whatever.
• 52:45
  Speaker 1: Wow. Yeah. And so, Dan, did you know people who left tech? I mean, the because I feel like
• 52:50
  Speaker 6: Oh, yeah. Yeah. Oh, yeah.
• 52:51
  Speaker 4: Yeah. Yeah.
• 52:52
  Speaker 3: Yeah. For sure.
• 52:52
  Speaker 6: I mean, there are people who were just like, I'm done. There was one guy who went and, like, lived on a island off the coast of Brazil studying capoeira for, like, two 2 years or something like that. I mean, you know, it's just
• 53:04
  Speaker 2: a a lot
• 53:04
  Speaker 6: of people people who had options who were just like, I don't wanna deal with it. I left tech,
• 53:10
  Speaker 2: actually, now that I
• 53:11
  Speaker 6: think about it. I basically with the computer with
• 53:14
  Speaker 2: me for 5 years. I I just I mean, I burned out after 2,001 and I was just
• 53:18
  Speaker 6: like, screw this. I'm gonna go do other things with my life.
• 53:23
  Speaker 1: And then how did the bust kind of affect your exactly, like, the bust definitely affected my own thinking. Certainly, I felt like I had some immunity around the the housing bubble. When the housing bubble started building, I'm like, wait a minute. We literally just walked out of this movie. Like, what what what are we doing yet?
• 53:38
  Is this this city?
• 53:39
  Speaker 2: I gotta properly credit this because it was, 2003 or 2,000 and 4 when you were, I, you and I were in Shanghai, Brian.
• 53:48
  Speaker 3: Right.
• 53:48
  Speaker 2: You were, you were explaining the looming, you know, to a 23 year old or whatever it was to the looming housing disaster, and it all made perfect sense, you know, except for the timing. But but you but you had called it perfectly.
• 54:03
  Speaker 1: Right. And I remember thinking and I remember thinking that the housing market had topped in 2 3. It's like, whoops. Definitely definitely wrong. And I just remember, like, 85% of all mortgages to Rich Aid San Francisco were option arms.
• 54:18
  And I'm like, okay. That's a top. And I'm like, that's 2003, and it's got a lot longer to run. And part of what makes these things, it it they do run up way longer than you think they should. And, I mean, I think it it has, I mean, the bust was so deep though and so long that it forever changed the way that certainly, I mean, when we raised at Oxide, I mean, Steve Serkin can can offer his perspective.
• 54:44
  But, I mean, we felt that the there would be a bust in in VC. And when we raised in in 2019, we felt that it couldn't go on. And we're was 2 years overdue.
• 54:56
  Speaker 3: Like, 2018 was when it was supposed to all burn down.
• 54:59
  Speaker 1: Right. And so we felt we were on borrowed time. And, Steve, I remember us thinking talking very explicitly about we need we deliberately wanted to raise enough that when there there was a funding when VC firms needed to pick their winners, they we would not be a small bet. We were forcing a a larger bet.
• 55:22
  Speaker 3: Yeah. And it went on for 3 more years.
• 55:25
  Speaker 1: Went on for 3 more years and it got way nutty earth. I got it. Do you
• 55:28
  Speaker 6: think that the pandemic gave a reprieve to all of these things? Basically, pushed off the emergence of a bust?
• 55:34
  Speaker 1: Yes. Because because I think that the pandemic got so scary financially. So, I mean, I think that we came very close to things getting truly cataclysmic in March, April 2020.
• 55:51
  Speaker 7: I would say there's another factor in that in that the the pandemic, especially in tech, caused a pretty pretty big shift in income inequality. And there are a lot of tech techpreneurs that, have nowhere to put their money, so they're trying to jam it into VCs.
• 56:10
  Speaker 1: Yeah. That's interesting. Yeah. Did you get this that, Theo, when you have a bubble that roll that that when it goes on long enough, people are beginning to plow all their winnings back into the bubble, which makes the bubble go even even more nonlinear.
• 56:25
  Speaker 7: And and the pandemic disproportionately, inflated net worth of of tech people versus other people.
• 56:34
  Speaker 2: Well, yeah, with the low interest rates, you know, folks folks looking for for growth, you know, the like Fidelity's and T. Rowe Price, all these folks who weren't traditionally, you know, involved in venture started dipping down. And then you get these both, you know, seeds and pre seeds in the, you know, present company excluded, of course, that were much bigger Spanker. Yes. Than previously.
• 57:00
  And, you know, certainly not in the case of Okta, but a lot of these companies we've seen, these are things that didn't really make sense, but all caught up in this, in this froth.
• 57:12
  Speaker 1: Yeah. And I think people also then raising too much money. Right? Or or actually or were actually raising on too high valuation. Yeah.
• 57:18
  But and I think you're
• 57:19
  Speaker 2: right that, like, the the, the perilousness of March 2020 and and the pandemic and and the ensuing, you know, financial uncertainty, it's probably propped up interest rates and and therefore propped up all of Venture. And now that interest rates are up, you know, everyone's leaving.
• 57:39
  Speaker 1: Yeah. I mean, we we basically we hose down the entire economy in in cash to just keep things basically afloat. The problem is that, Theo, I agree with you that the it was such a a a brute force mechanism that it actually exacerbated income inequality. And, I mean, I I feel that the, giving putting money in people's pockets that don't need it, you're gonna end up with with things like cryptocurrency. Right?
• 58:06
  Well, I think the stimulus I mean, I think the stimulus checks it'd be interesting to know. I think it's kind of unknowable, but what fraction of the stimulus checks went to cryptocurrency? Some fraction.
• 58:14
  Speaker 2: You know, this is a this is a a data point along these lines. A buddy of mine, works for Twitch and has access to a bunch of their data, and and the stimulus checks were very noticeable in their data that that the that folks were watching more streaming video. And when those $2,000 came out or whatever it was or $600 came out, very visible in their data. So not obviously, not crypto, but, you know, going to places where maybe the money hadn't gone previously, traditionally.
• 58:47
  Speaker 5: Do you think that there's a qualitative difference in not setting aside perhaps the crypto, circus, the but but all the other companies that have come up in the last 5, 6, 7 years, is there a qualitative difference in their ability to at least have revenue? It feels like in the original dotcom thing, no one knew how to make money from the globe.com or
• 59:13
  Speaker 2: or almost anything else that was happening.
• 59:15
  Speaker 3: Are you accusing boo.com of not having a good revenue model?
• 59:18
  Speaker 2: Well, I just like, there wasn't even a way to get payments. Like,
• 59:24
  Speaker 5: whereas now, like, Spotify and every other service at least can have a subscription. And it's, like, it's understood that, like, all these streaming services can rake in $9 a month or something per subscriber. And we we know at least now, like, there's kind of a language for people actually paying for things.
• 59:41
  Speaker 1: I don't know. Yeah. I mean, I think I agree with that to a point. I mean, but but can Uber be profitable? Well,
• 59:49
  Speaker 5: no. But that's because they're a large, like, crime organization trying to obliterate the taxi system.
• 59:55
  Speaker 1: But but, I mean, but you wonder if Uber and or and Lyft are viable businesses at the at what they need to charge in order
• 1:00:02
  Speaker 6: to be profitable.
• 1:00:03
  Speaker 2: And those are even extreme examples. I mean, I think that there's lots of much smaller companies where while you have investors and entrepreneurs talking about the death of the magical thinking that led us to the dotcom bust, I think doing a lot of the same things. And I think there is still this thought that there's this alchemical formula for turning eyeballs and clicks into revenue. Yes. And and there isn't And or people don't know what it is.
• 1:00:31
  Speaker 3: And so
• 1:00:32
  Speaker 6: I mean, Google stumbled on the whole AdWords fountain of money back in 1990, whatever. And and, you know, that has led to this idea that it's like, oh my god. You just do ads and all of
• 1:00:43
  Speaker 2: a sudden you rake in, you know, 1,000,000,000 of dollars a quarter. And it's like inflation monopoly.
• 1:00:49
  Speaker 6: Well, yeah. Basically, you have to you have to be one of the, you know, like, 6 sites on the Internet for which that is true. But, like, I mean, I I think Josh asked an interesting question. Like, is there a qualitative difference between now and the dotcom era? And I'm gonna say yes.
• 1:01:05
  I mean, you know, I I was sort of safely tucked away in a little corner in Google for most of this boom. But I I've never seen anything that approached the levels of just, like, straight up, frankly, fraud that you saw during the dotcom boom. And it's it's just it's not even close.
• 1:01:25
  Speaker 2: No. I I totally agree with that. But, but I do think that it's it's a matter of degree. And I think there are a lot of you know, Josh had asked about or commented on these companies that have no path to profitability, and and any potential path has now been foreclosed. I think we're gonna see a lot of that, but but agreed, Dan, nowhere near the level of, the level that we saw in 2001.
• 1:01:49
  Speaker 1: So okay. I'm not so sure though because I think that you also can have companies that are viable going concerns, but for whom the expectations are so far ahead of what they can possibly do. I mean, Snowflake's market cap was bigger than their TAM. Right? I mean, it's like that that's not sustainable.
• 1:02:05
  And and where you end up going is over expectations will, I think, overshoot on the other side. And it gets really grinding. I mean, Sun was trading below its cash. The market cap was less than our cash, which is really, like, talk about,
• 1:02:22
  Speaker 2: like, a photo of no confidence.
• 1:02:24
  Speaker 1: Photo confidence. Like like, we actually think you're actively burning it. Like, you because and I I show what would be and ultimately and when things busted out again in 2008, 2009, leading the acquisition, It's like I mean, Sun was acquired effectively for a song, and I feel that we're we're you're gonna see you there are definitely some viable companies in here, for sure. Sure. And I think is it more viable than the dotcom bus?
• 1:02:50
  I don't know. I think you're gonna have to look at in hindsight, because I just don't know how much of Uber and Lyft, how much of Airbnb relies on this kind of infinitely long boom with discretionary income. I don't know. I mean
• 1:03:06
  Speaker 2: Brian, was he I don't know if he was you who'd told me this, but someone said the harbinger of of the boom, harbinger of these bubbles is when you start seeing you'd say 4 years ago
• 1:03:26
  Speaker 1: Yeah.
• 1:03:27
  Speaker 2: You know, people were saying, you know, that's what was happening in 2,001. That's what was happening in 2,007.
• 1:03:33
  Speaker 1: Yeah. Cosmo.com, baby. Yeah.
• 1:03:36
  Speaker 2: And and yet now, I mean, like, of course, but food should be delivered to my house. Like, why why is that anomalous?
• 1:03:44
  Speaker 4: But now you have, like,
• 1:03:44
  Speaker 3: 2 different grocery delivery services competing for 30 minutes versus 15 minutes versus 10 minutes. And, yeah, you're you're definitely gonna see some consolidation there. I would be just on, one one of the earlier points that it brought me back because, Adam, you were talking about, I think it was Tivoli, and or some of the Austin tech companies. I was in
• 1:04:06
  Speaker 1: Austin. Trilogy. Not Tivoli. Tivoli. Tivoli.
• 1:04:08
  Tivoli is a good one.
• 1:04:09
  Speaker 3: So Tivoli and Trilogy both were hoovering up employees in Austin. I got there in October 99, and that's when I started at Dell. And just one quick hilarious story in retrospect, Dell was infamous for having this group of delionaires that
• 1:04:29
  Speaker 1: and you would read
• 1:04:31
  Speaker 3: about this. And for good reason, because the stock in the nineties had gone up by something like 90,000%. It was the it was the the you know, the largest increase of any stock from whatever, like end of 89 to end of 99. And so I showed up, of course, at the absolute peak. And our our, like, entrance class that came in, they brought our class to this big
• 1:04:54
  Speaker 1: It's a mere studio.
• 1:04:54
  Speaker 3: Auditorium, and they had this, oh, priming.
• 1:04:59
  Speaker 2: No. It's just too prime. Steve, you sound good. Okay.
• 1:05:01
  Speaker 1: Oh, no. And they brought us in
• 1:05:03
  Speaker 3: this big auditorium and they, put a video up on the board. So, like, bunch of food and drinks and pomp and circumstance. And they put up on the screen this, rendition of from from Sister Sledge, we are family. Instead it was we are billionaires. And you would see Dell employees dancing on desks as they dropped fake options from the ceiling.
• 1:05:28
  And so it was the absolute pinnacle of excess. And at the time, you didn't realize it. You were just like, oh, this is this is great. And then fast forward, of course, the the like, the two moments I best remember, the first was the margin calls because those came before the lay offs at Dell anyway. And margin call was a an explicit afternoon where every single middle manager in Dell that was way highly overleveraged, and, you know, we're then, like, betting on the margins on, every single other technology
• 1:05:57
  Speaker 1: stock. So, Steve, when you say margin call, you're not talking, like, gross margin. You're talking, like, people at Dell who were trading on margin. That's right.
• 1:06:05
  Speaker 3: Wow. Okay. We're betting.
• 1:06:06
  Speaker 4: That's right.
• 1:06:06
  Speaker 1: Oh, boy. That's right.
• 1:06:07
  Speaker 3: So they they these are, you know, like, all of the kind of mid level sales management and and above that had all you know, they were up $4,000,000 on paper, and they were, you know, building a brand new house in a great neighborhood. And then one afternoon went from up 4,000,000 to down $500,000 that they didn't have. And so you just saw these folks that were living high on the hog just like green, like, legitimately nauseous and running for the bathrooms. And I just remember because because it hit so many people on the same floor. It's like we were all asking, like, what the hell is
• 1:06:43
  Speaker 1: going on? Like, food poisoning in the cafeteria.
• 1:06:47
  Speaker 3: Totally. Because the bathrooms reeked of violence. Oh my gosh. And, so that margin call day was the first big one. It was the first big warning shot.
• 1:06:54
  And then And when was that stage?
• 1:06:56
  Speaker 1: Is that just when is that? Is that 2,000 sometime?
• 1:06:59
  Speaker 3: This yeah. It's, like, late 2000, and then layoffs were 2,001. And that was notable only in that on, like, the way Dell set it up as they have these floors of, like, 300, 350 people that were on a floor, and it was all open. Cubicles, but, like, you could stand up, and you could look, like, all the way down to other end of the building. And you saw, like, the the the SVPs all kinda huddling and then starting to snake out down the aisles, shoulder tapping folks.
• 1:07:26
  And all the conference rooms had had paper taped up over the glass slits because they needed, like, you know, 40 different rooms to just be cycling out dozens and dozens and dozens of people that day. And so the first offers had, you know, basically, you know, it was just an offer with a couple of different things that included, like, non disparagement and, and then the offers because the press started showing up in the parking lot and doing interviews, then added a clause which was like, will not speak to the press for, like, an extra bump of $25100 or whatever it was.
• 1:07:59
  Speaker 2: Man, jeez. Wow.
• 1:08:00
  Speaker 3: But the, yeah, the Delionaires video, I've tried to track that thing down ever since and have been unsuccessful. It was, it's a doozy. That Delionaires.
• 1:08:09
  Speaker 6: Somebody took 25100 bucks to keep that sucker hidden. So here's, like, in a in a in a totally tone deaf layoff experience. So this the second startup that I worked at in New York in 2001 after 9:11, and they were they were gonna go out of business. This was this was clear. And so there were, like, successive rounds of layoffs.
• 1:08:31
  And this is probably, like, October, November 2001. Right? Now does anybody know what Windows in the world was? You know?
• 1:08:38
  Speaker 1: Yes. Definitely. World trade. Absolutely. Yeah.
• 1:08:41
  Yeah. Yeah.
• 1:08:42
  Speaker 6: Yeah. Windows on the World was the restaurant thingy
• 1:08:45
  Speaker 2: in in the top
• 1:08:46
  Speaker 1: at the top of the
• 1:08:47
  Speaker 6: World Trade Center. And there we had a conference room in this company that was named after various locations in
• 1:08:54
  Speaker 2: New York.
• 1:08:54
  Speaker 6: One of which was Windows in the World.
• 1:08:56
  Speaker 4: Oh, god.
• 1:08:56
  Speaker 6: Yeah. You get that it is coming. And the phone system was one of these things where, like, you would get a phone call, like, an interoffice phone call, and it would tell you who was calling you. And they would all they were doing all the layoffs and windows of the world.
• 1:09:09
  Speaker 2: Oh, god. It was like your phone would ring.
• 1:09:13
  Speaker 1: Oh my god.
• 1:09:14
  Speaker 4: Yeah. And and yeah.
• 1:09:15
  Speaker 2: You yeah. I know. Your phone would ring. You would get
• 1:09:17
  Speaker 6: a phone call from Windows on the world, and it was like, okay. I know I'm gonna go I I'm going to go and become the sacrificial lambs of this company and keep going for another month or something like that.
• 1:09:27
  Speaker 1: I just And it was 9:11. Yeah.
• 1:09:30
  Speaker 6: It was after 9:11.
• 1:09:39
  Speaker 1: Pretty tough. Yeah. Awful. Well, it is, like, one of these things that's, like, they're just not connecting the dots. I'm like, hey.
• 1:09:44
  The optics of this are are it's, like, time to change the name of the conference room.
• 1:09:49
  Speaker 2: It's like calling you flagship software product, Omicron.
• 1:09:53
  Speaker 1: Yeah. Who would even do that?
• 1:09:55
  Speaker 2: Too soon.
• 1:09:56
  Speaker 1: We were first. Goddamn it. Alright. And I wanted our next version is monkeypox. Matt, you've had your head up for a while.
• 1:10:03
  Sorry about that.
• 1:10:06
  Speaker 8: Yeah. So, good timing actually since since you just brought it back around the oxide. Uh-oh. I might get in trouble for this question. But, do you guys worry that oxide is going to suffer the same fate as, like, Sun and the other pick and shovel companies of the previous bust.
• 1:10:26
  I mean, well, I'm I'm sure you guys are have learned the lessons and are doing things differently this time, but at least from my outsider perspective, an oxide rack seems like it could be today's e 10 k.
• 1:10:41
  Speaker 2: No. Well, I I think that's a pretty I don't think the metaphor is that great there. And I think for
• 1:10:46
  Speaker 1: Because we're not selling them yet? Because
• 1:10:49
  Speaker 2: well, first, we're not I mean, I I think that, you know, downturns, like, you know, will always punish incumbents to a degree. And I think for startups, it becomes an interesting opportunity where, you know, in, in high times, and, and this is what Sun saw certainly in, saw certainly in in, you know, the late nineties in high times, people aren't really looking for the low cost option, right? They're they're fine spending and spending and spending. And business as usual is sort of the safest course. And when, you know, is when, startups can survive these downturns, it becomes a huge opportunity where these prospective customers who would normally not really consider, you know, what they see as a risky option of doing something other than business as usual.
• 1:11:37
  Suddenly, it's not just interesting, but it's a necessity. Right? They need to cut, you know, 1,000,000 or tens of 1,000,000 of dollars from their IT budgets. And doing things with Dell and HP or incumbent, you know, vendors doesn't get you there.
• 1:11:51
  Speaker 1: Well and the dotcom bust, I think, actually accelerated the rise of open source. Hot take.
• 1:11:59
  Speaker 2: Yeah. That might be right. I
• 1:12:00
  Speaker 1: I buy it. Yeah. Because I like it there. Because I think that if you were building, you know, you were talking about the, the even though, Dan, in this house, we don't speak ill of science or whatever the whatever god whatever god bless techno the consultant team was
• 1:12:15
  Speaker 6: Speaking of love then.
• 1:12:17
  Speaker 1: I I was was was providing us our Chateau d'Yquem. That was not true in 2,002,003, 2004, and everyone is building based on x86 and open source because because it just the economics are so front and center. I think, Matt, I agree with everything that Adam said. I I think that the I I would also say I mean, a couple of other things. One, we do not know to what degree, I think there's an argument to be made.
• 1:12:44
  I'm not sure that I would make it, but there's an argument to be made that, the, that oxide or something like it is countercyclical in that when people begin to focus on costs, like the cloud computing, renting all all of your cloud renting all of your compute, doesn't make a lot of economic sense.
• 1:13:02
  Speaker 2: So I think there's a final AWS isn't gonna be 10 times cheaper just because it's a bust. Like
• 1:13:07
  Speaker 1: No. No. No. I don't think so. Well, and I so I think that's gonna be interesting to keep an eye on.
• 1:13:11
  And I think that the I I mean, we yeah. We know that, like, price reductions on the cloud have basically stopped, especially in an inflationary environment. There's also a weird, like, a weird spin on things that definitely did not exist for the dotcom bust. And then I I think that we so the 1 2, I think that also what Adam was saying about startups, it's it's actually to a certain degree, it is easier because the absolute numbers you're building on are so low. You're not actually trying to preserve.
• 1:13:38
  You know, we don't have a a install base of 10 tens of thousands of customers who are now reevaluating their decisions. Indeed, to the contrary, we've got folks that we got a lot of targets out there that are looking at, like that are waking up to, you know, VMware possibly being acquired by Broadcom, Right.
• 1:13:55
  Speaker 2: Which is Right. Where where 2 weeks ago or, or a month ago, the idea of like shaving 5% of their IT spend was like, sort of not that important to them. Maybe we're suddenly saying actually, you know, maybe we do need to look at that AWS bill and, and think about, like, how we're paying for VMware and imagining how those prices might increase in the face of an acquisition or whatever.
• 1:14:17
  Speaker 1: Now that said, I don't believe that anything is I think sometimes people believe they're countercyclical, truly countercyclical. I think it's really hard to be truly countercyclical. I think that, like, I think that a bust tends to to to hurt everybody. I don't know. Maybe liquor is actually truly countercyclical.
• 1:14:36
  Speaker 2: Alright. Okay. New new start up idea within the company. Got it.
• 1:14:39
  Speaker 1: No. But I doubt it, actually. I mean, I honestly, I doubt it. I think that, like, the, you know, the the the hard alcohol that I'm I I am that one would drink in the bust surely is is got lower margin than the Chateau D'Aquis you you drank in the boom. And I so I I think that, you know, a bust is in that regard is not necessarily in anyone's best interest, which is part of the reason.
• 1:15:01
  I actually I'm kinda curious what those of us who lived through it. What kinda stuck with you from the the dotcomboomandbust? Certainly, one thing that that stuck with me is, 1, we are definitely not in a bust proof industry, obviously. And indeed, we are, arguably more vulnerable to irrational exuberance. And 2, it's like busts are not great.
• 1:15:24
  That booms are not great and busts are not great. And that you ideally wanna keep things cooler on the way up so they don't get as frozen on the way down. Basically, both of these extremes result in in misallocation of resources.
• 1:15:39
  Speaker 2: And Also oscillating overcorrection in both directions is is truly catastrophic as it continues to run a lot further and further away from, like, a bias level.
• 1:15:48
  Speaker 1: Right. And I you will absolutely have, I mean or it gives you there to kinda take a poll of folks, you know, are we headed into a bust, and how deep is this thing gonna be? So, actually, I I I'll throw that out. There's a question. Adam, what do you what what what's your
• 1:16:02
  Speaker 2: What's my takeaway from the previous bust?
• 1:16:04
  Speaker 1: Yeah. I mean, do you feel that we are well, 1, what are your takeaways? And 2, do you feel that we're headed into something that's gonna be as deep? Or what do you think it's gonna look like? I mean, I think it's
• 1:16:13
  Speaker 2: gonna be deep. I mean, I I think it's gonna be really deep in terms, in terms of perhaps, like, the golden era of of venture. Maybe that's a wrong way to think about it. But in just in terms of the proliferation of startups, startups doing interesting things, starting to startups doing things that are are misinformed or whatever, but I think that there's gonna be a a deep contraction there. There's also gonna be a, a reversal in in sort of the, the founder's rights where I think as capital dries up, we're gonna see less and less founder friendly activities and much more, cold financial decisions around these smaller companies.
• 1:16:57
  And
• 1:16:57
  Speaker 1: Let the record reflect that we have no that we are not one of these crazy companies that has, like, super voting shit.
• 1:17:03
  Speaker 2: No. Totally. Yeah. Right. Absolutely.
• 1:17:05
  Right. We're we're we're founders of outsized privileges, not not one that, that I would ever work for, to be clear. Like, like, signing up for that kind of thing is a little nutty, for for both, investors and employees. So, yeah, I think it's gonna be deep, and I think that like, it I agreed with what you're saying that like being being cool and being connected with, the customer throughout what you do is is that load star, that I I think has guided people through, you know, both boom and bust.
• 1:17:39
  Speaker 1: Yeah. I think you're right. I think you gotta be you're gonna have to stay connected. And I think that then also you're gonna have to we're all gonna have to stay nimble because I think things are gonna probably change quite a bit. And I think that you're gonna once expectations really start to shift and I think that it's very hard to predict is the other thing I would say.
• 1:17:58
  I mean, I I don't know that we other than I think that that things will change. And I do think it's gonna be deep because I think it's gonna broader. I think that unlike the dotcom bus, which really affected tech very, very deeply, and the rest of the economy kinda not so much, I kinda think we're headed into both. I think that that that tech is gonna be adversely affected, and I think we've got a lot of built up I mean, the fact that there's all this inflationary pressure I mean, not just inflationary pressure. Jesus.
• 1:18:25
  It's like, like, legit hardcore inflation. I I think is is gonna make this bust different.
• 1:18:33
  Speaker 2: You know, the the the human consequence I think I worry about maybe maybe too much is these folks who have been drawn in by these, hacker accelerators or learn to code quick kind of stuff.
• 1:18:44
  Speaker 1: Yeah.
• 1:18:44
  Speaker 2: And I think they're just gonna be left with nothing. Right? They're gonna be taking this plunge into a new career, you know, going out west and buying their pick and their shovel and then ending up with nothing. I don't know. I I just feel like there's been a lot of false promises.
• 1:19:00
  I mean, I've I have less sympathy for the folks who've jumped onto the crypto bandwagon, but I think there are a lot of gonna be a lot of lost wealth and and for folks who couldn't necessarily sustain a deep loss.
• 1:19:12
  Speaker 1: I think you're absolutely right. I also think that, like, I think that in this long boom, we've been a bit too focused on MAMM, honestly. And I don't know. I think for me, like, I feel that, like, during the dotcom boom, everybody got greedy. And including me.
• 1:19:32
  I mean, I think that, like, I don't know. I mean, I don't feel like anyone was really a mute there was a, there was a lot of greed. A lot of delionaires, Steve. Del was definitely not alone in that. I don't know who called him at Sun, but they, I I feel that at in the bust, it was kind of a reminder of the things that were actually important and, like, not focusing as much on the, like, reminding me why I got into this.
• 1:19:58
  I didn't get into this to get rich. And the .gov was
• 1:20:02
  Speaker 2: Yeah. The blog published. Right?
• 1:20:03
  Speaker 6: The good
• 1:20:03
  Speaker 1: checkout was like, good news.
• 1:20:06
  Speaker 2: Right. Remember those stock options you didn't sell?
• 1:20:09
  Speaker 1: The or or, did sell. And, the I actually all of my .com winnings, I backed into a biotech company that probably went out of business. So that was
• 1:20:20
  Speaker 2: Nice.
• 1:20:21
  Speaker 1: Yeah. I I had a loss carry forward that I I I was taking on my taxes for a very, very, very long time. And the people I know that actually made money, like persistent money off the dotcomboom did so because they left tech early. Because they didn't like like it to begin with. And they somehow were just, like, ironically, they were satisfied with their their outsized winnings, so they just left.
• 1:20:49
  And then those folks made a lot of money. Those are the only ones I know who made money. Most everyone else, I think, got kinda washed out. And then so and then, Adam, any advice for for folks? I mean, if someone was asking us, alright, based on on what we knew then, like, what should people do for the next couple of years?
• 1:21:08
  How long is this gonna take and and and what what what should they do?
• 1:21:11
  Speaker 2: Yeah. I think couple of years is probably right. Like, 2, 3 years, like, feels I mean, I don't know. Maybe that's gonna maybe in 5 years, we're gonna see that as hugely optimistic, when right now it feels pessimistic. I mean, much like I did in March 2020, when I was predicting how long this thing was gonna happen.
• 1:21:29
  So, yeah, I think that's the right kind of time frame. And I think you're right. Like, finding the things that matter. I mean, certainly, if you were in it for the money, like, you know, disabusing yourself of that and and, like, finding the folks you wanna work with, the stuff you wanna work on, and making sure that I mean, maybe it's too late for this, but not spending the stock options that you hadn't sold yet? Yeah.
• 1:21:53
  And what do you think?
• 1:21:54
  Speaker 1: Yeah. I think that's it. I mean, I think that and that the and I just think, like, I do not recommend buying the dips. I mean, I I I think that there's a it's kind of cryptocurrency idea that it's all gonna come back, and it's like, I think a lot of this is, is gonna be, it's gonna be down for a while, I think, and and we'll see. May I mean, maybe not.
• 1:22:14
  I I don't think it's necessarily in anyone's best interest for it to be down for a while, so I don't necessarily think I want that, but I think that there's gonna be a lot of things that need to be corrected from an asset allocation perspective that are that we're gonna be enduring.
• 1:22:28
  Speaker 7: That's right.
• 1:22:29
  Speaker 1: Dan, you've had your hand up. Maybe you get guess, or or kind of our our closing thoughts here?
• 1:22:34
  Speaker 4: Okay. Well, it's funny. I was gonna talk about the question
• 1:22:39
  Speaker 2: that was asked earlier about
• 1:22:40
  Speaker 4: oxide, but your question also ties to the same period in time, you being a student of economics and history. 1982 is when Paul Volcker finished cranking up the Fed rates to kill the inflation part of the 19 seventies stagflation.
• 1:22:59
  Speaker 1: Yeah.
• 1:22:59
  Speaker 4: Gene, who started around that time as a company?
• 1:23:04
  Speaker 1: Yeah. That's interesting because that is actually an interesting question. I mean, I know and I thought I saw Tom here earlier. I I mean, the 82 started then. I know Sun started then.
• 1:23:13
  Eighty 2, though, is really bad from the 82, 83 recession is gnarly.
• 1:23:21
  Speaker 8: Oh, yeah.
• 1:23:22
  Speaker 1: But you're right. Yeah. I mean, son, a bunch of companies started in in in 82, 83, 84.
• 1:23:27
  Speaker 4: Yeah. And so, I mean, that you know, party like it's 1982. I mean, right now, I
• 1:23:34
  Speaker 1: think the best is trying
• 1:23:35
  Speaker 4: right now, the fed is trying to make it, like, 1994. Okay. We're just gonna keep bumping half point, half point, half point, and
• 1:23:40
  Speaker 3: it's gonna land softly. I hope it works. I don't know if it will, but,
• 1:23:46
  Speaker 4: you know, get get ready for possible craziness. And both of the other bubble bursts you talked about, my own life, it was like, well, we had some things we needed to get done. And, well, shit, the economy is going to hell, but we we still gotta do them. If you can find a way, make sure you still gotta do it. Take care of yourself and take care of your family.
• 1:24:08
  I moved coast in 2,001, and we moved house in 2009. We took a small loss on our old house and but we got a new one at a at a relatively discounted price compared to what the neighbors had paid for theirs. Economic fear you've gotta take it into account, but don't and don't let economic fear you gotta take it into account, but don't let it, like, completely scare you off.
• 1:24:36
  Speaker 1: That that's a good point, Dan. Except you we bought our house in December of 2 1,008. And after being a, a housing I mean, as as as Adam was saying earlier, I was calling the top of this thing since 2003, and I and I was like, well, I've gotta buy because, like, I got a kid that needs to go to kindergarten, a kid that just graduated from high school next week.
• 1:24:57
  Speaker 4: Congratulations. Yeah.
• 1:24:59
  Speaker 1: Well, but but let's get all the way there. I'm just gonna get the phone on hand, please. The, but I was convinced at the time. I'm like, well, this is, like, this is not good. You know, I you know, I'm gonna be this thing is gonna continue to lose value for a couple of years, but this is what we have to do.
• 1:25:14
  And as it turns out, like, we ended up kinda accidentally timing it better than we intended. But I think you're that's a very good point. Just not the fear consume you, and you've gotta do what you need to go do, and and to not, you know, it'll be it'll be okay. It's gonna be it'll be bad, but it'll be okay.
• 1:25:30
  Speaker 4: I wanted to go dad survive neutron jack as a GE lifer. God. Oh, god.
• 1:25:37
  Speaker 1: Yeah. You gotta give him lights out. The the I saw Bezos was was tweeting about lights out as well. Such a terrible book. A terrible terrible person.
• 1:25:45
  Great book. Theo, you had your your your head up.
• 1:25:49
  Speaker 7: Yeah. So takeaways from the dotcomboom, that stuck stuck with me are a deep appreciation for brown liquor and cigars. That's I enjoy those today, and they're still affordable, so that's fantastic. I would say that that, this down that this downturn is going to be, inconsistent across industries, I think.
• 1:26:13
  Speaker 1: Yeah.
• 1:26:14
  Speaker 7: And it'll last about 3 years. I don't think that the inflationary, pressures on that is gonna change the timeline, but it'll certainly change the gravitational effect of it. And I, I think that the big unknown for me is that the supply chain has not been rectified, and I don't know how that's gonna interplay with everything. It's just it's that's something we've never really seen, this prolonged supply chain problem.
• 1:26:45
  Speaker 1: Yeah. Agreed. This is definitely it is weird. And, I mean, obviously, we've had a very sharp eye on it, Oxide, and I've gotten ahead of for the things that we need to get ahead of it on. But, if the supply chain problems can rectify themselves, that would be really nice.
• 1:26:58
  Speaker 2: That'd be super great. I I, I you know, a 14 month waiting list for a car.
• 1:27:04
  Speaker 1: Right. Right. And you that's gonna be an interesting thing to watch, I wonder. Although, Theo, maybe your point of it it's just being inconsistent. So do you think that this could be a you know, it's it's kind of the always I think Truman had the line that it's a it's a recession when your neighbor lose their job, but a depression when you lose yours.
• 1:27:23
  Right. And if if is this gonna be inconsistent? And are we gonna see and and, I mean, I think you were arguing this has happened since the pandemic, where you've got some people who are really, really struggling, but it's not but others that aren't.
• 1:27:38
  Speaker 7: Yeah. Yeah. It's just gonna be a huge shakeup.
• 1:27:41
  Speaker 2: Yeah. I think the best advice for trying to stay safe economically is to figure out if your company that you work for and your role even within that company, marginal or or not to the company or or even to, like, the whole economy? Like, are you making something that people will still need?
• 1:28:06
  Speaker 1: Josh, you need to be reassured that you are not marginal at auction. I did.
• 1:28:11
  Speaker 2: I mean, I would, if you could print a small certificate
• 1:28:14
  Speaker 7: that I could stick on my desk.
• 1:28:15
  Speaker 2: It's recorded. You know? We got this call ready. That would that would help me.
• 1:28:19
  Speaker 1: The proclamation of non March Valley.
• 1:28:21
  Speaker 2: Yeah. You know, the last thing Brian would like to leave folks with too is, I think in these times, it becomes really easy to focus on yourself and focus on your own family. And I think just casting an eye, you know, a little bit beyond that to the folks in your community where where your time and your money can still be helpful in helping other people and impacting their lives. And also investing in the change you want to see whether that's political donations or invest you know, changing your 401 k so that it's not invested in oil and ammunition and things like that. So, you know, certainly taking care of what's close at hand, but thinking about those around you who you can still help.
• 1:29:00
  Speaker 1: Did you recently did you have an oil and ammunition position that you recently unwound?
• 1:29:06
  Speaker 2: We swapped it out for swapped it out for crypto. This is what my wife does actually. So, her organization, as you sell, like, ranks investments. And it turns out a lot of the, like, a lot of the oxide 401 k is invested heavily in, like, tobacco and oil and, and The sub the subjugation of foreign nations. It turns out it's it's really easy to sort of click the defaults and and, and be investing in things that sort of preclude the future rather than investing in
• 1:29:35
  Speaker 7: it. So
• 1:29:36
  Speaker 2: get out of oil but stay in tobacco because
• 1:29:38
  Speaker 7: I smoke a lot of cigars
• 1:29:40
  Speaker 2: now. Well, you're long tobacco. Okay. Gotcha.
• 1:29:45
  Speaker 1: Alright. On that
• 1:29:46
  Speaker 6: actually well, okay.
• 1:29:47
  Speaker 1: Yeah. Go ahead, Dan. Sorry.
• 1:29:48
  Speaker 2: I was just gonna say
• 1:29:49
  Speaker 6: I actually think that's really good advice. It's like, look, my big takeaway from the dotcom bust was if something looks too good to be true, it is too good to be true.
• 1:29:58
  Speaker 1: Yeah.
• 1:29:58
  Speaker 6: And if if something doesn't make any sense to, like, the layperson as an idea, then it's probably a bad idea. I mean, if you stick to things that that seem like they make sense like, you know, I work at Oxide, so I'm biased, but, like, we make computers. People are going to continue to buy computers. I'm not terribly worried. You know, but if you work at, like, boo.com or Fluz or something, and you're like, this is stupid.
• 1:30:25
  Speaker 1: You know? Yeah. No. There's there there is definitely something to that that the, if it and I think also, you know, take good notes because, those of for who are kind of coming up during this period of time, you know, in 20 years, you're gonna be on a Twitter space or ShoutCloud. What was that called, Matt?
• 1:30:44
  Whatever whatever the whatever that was. Whatever the ShoutCloud is of 20 40,
• 1:30:51
  Speaker 2: you'll be able to The newer the Neuralink continuum?
• 1:30:55
  Speaker 1: The exactly.
• 1:30:56
  Speaker 2: It'll be a metaverse therapy room.
• 1:30:59
  Speaker 1: That's right. You're gonna be, and and you you yourself will be recounting tales of the the bust of 2022 to question mark question mark question mark. Alright. Well, hey. On that note, I this has been a lot of fun.
• 1:31:14
  Always, funder to to to reminisce about the bust, hoping that this one doesn't affect people too adversely, other than the crazy stuff that we wanna attack adversely. So, Ryan, Breslow, talking to you. Other than that, I'm the Ryan Breslow. Alright. Thanks everyone.
• 1:31:30
  See you next time.
• 1:31:31
  Speaker 7: Thanks.