1 00:00:00,000 --> 00:00:02,040 if 90% of all startups still fail. 2 00:00:02,040 --> 00:00:03,560 Maybe something is wrong about it 3 00:00:03,560 --> 00:00:05,680 because what you really need within your local community 4 00:00:05,680 --> 00:00:08,280 are the individuals who are starting new things 5 00:00:08,280 --> 00:00:11,480 that manifest in a net positive growth 6 00:00:11,480 --> 00:00:13,160 in all of the jobs that exist. 7 00:00:13,160 --> 00:00:15,520 If you don't have that creative aspect to what's going on, 8 00:00:15,520 --> 00:00:17,680 you don't inspire risk, you don't inspire creativity. 9 00:00:17,680 --> 00:00:19,560 And so really all we do with startups is 10 00:00:19,560 --> 00:00:22,440 we reduce the likelihood of failure as much as possible. 11 00:00:22,440 --> 00:00:23,920 And so there are playbooks to do that. 12 00:00:23,920 --> 00:00:26,720 And that's why you hear things like lean startup 13 00:00:26,720 --> 00:00:28,000 or product market fit. 14 00:00:28,000 --> 00:00:30,120 You hear things like validation, market validation 15 00:00:30,120 --> 00:00:30,960 or customer validation. 16 00:00:30,960 --> 00:00:34,360 In the startup sector, the fact is you have to be conscientious 17 00:00:34,360 --> 00:00:36,360 of your obligation and your responsibility 18 00:00:36,360 --> 00:00:37,360 to be able to do all things. 19 00:00:37,360 --> 00:00:38,960 In innovation and entrepreneurship, 20 00:00:38,960 --> 00:00:40,800 we're trying to help people avoid the mistakes. 21 00:00:40,800 --> 00:00:43,000 We're trying to help you avoid the likelihood 22 00:00:43,000 --> 00:00:45,200 that you're going to fail, so that you can focus 23 00:00:45,200 --> 00:00:47,160 on the things you need to do to make it successful 24 00:00:47,160 --> 00:00:48,640 as opposed to wasting your time on the stuff 25 00:00:48,640 --> 00:00:51,560 that we already know it doesn't work. 26 00:00:51,560 --> 00:00:52,320 - Hey, Paul. 27 00:00:52,320 --> 00:00:54,560 Welcome to the Executive Connect podcast. 28 00:00:54,560 --> 00:00:55,920 - Brian, man, how are you doing? 29 00:00:55,920 --> 00:00:56,920 - Man, thanks you're good. 30 00:00:56,920 --> 00:00:57,760 Thanks you're good. 31 00:00:57,760 --> 00:00:59,200 See you all, good to see you all. 32 00:00:59,200 --> 00:01:00,600 - That's a bit of a lie. 33 00:01:00,600 --> 00:01:02,560 - It is. 34 00:01:02,560 --> 00:01:03,720 (laughing) 35 00:01:03,720 --> 00:01:06,120 Which is what everybody seems to say these days. 36 00:01:06,120 --> 00:01:09,480 Well passed, being locked down, thanks to quarantine 37 00:01:09,480 --> 00:01:12,440 for some reason we're a little less social 38 00:01:12,440 --> 00:01:13,600 than we used to be, aren't we? 39 00:01:13,600 --> 00:01:16,960 Not as many coffee shops and meetups and happy hours. 40 00:01:16,960 --> 00:01:18,200 So it is good to see you. 41 00:01:18,200 --> 00:01:21,120 - Yeah, so you know, I'm sure most of our viewers 42 00:01:21,120 --> 00:01:23,600 don't really super familiar with you and your work. 43 00:01:23,600 --> 00:01:27,040 You wanted us to give us the download on all things 44 00:01:27,040 --> 00:01:28,400 and start it up incubator, 45 00:01:28,400 --> 00:01:30,400 got it your career arc? 46 00:01:30,400 --> 00:01:33,080 - Who the heck is this guy and why is he on your show? 47 00:01:33,080 --> 00:01:38,320 I'm sort of a contrarian with regard to entrepreneurship 48 00:01:38,320 --> 00:01:41,360 by which I mean, if you've read the books, 49 00:01:41,360 --> 00:01:45,040 if you've read the podcast or heard the podcasts, 50 00:01:45,040 --> 00:01:48,280 you get all the same stuff from literally everybody 51 00:01:48,280 --> 00:01:51,360 and their mom with regard to how to start up successfully. 52 00:01:51,360 --> 00:01:53,520 And I'm one of the few guys that kind of says, 53 00:01:53,520 --> 00:01:56,520 hang on a second, if 90% of all startups still fail, 54 00:01:56,520 --> 00:01:58,960 maybe what's being preached is wrong. 55 00:01:58,960 --> 00:02:01,080 Maybe something is wrong about it. 56 00:02:01,080 --> 00:02:03,600 And so I spent a lot of time in Silicon Valley. 57 00:02:03,600 --> 00:02:05,760 I've been in Austin for 16 years. 58 00:02:05,760 --> 00:02:09,400 I've run incubators, I've designed startup curriculum. 59 00:02:09,400 --> 00:02:12,880 I work internationally to a great extent. 60 00:02:12,880 --> 00:02:17,880 I get hired by governments, cities or other countries 61 00:02:17,880 --> 00:02:19,960 for the most part to try to help them figure out 62 00:02:19,960 --> 00:02:22,160 how to build their ecosystem. 63 00:02:22,160 --> 00:02:23,680 And a lot of what I do is just coming in 64 00:02:23,680 --> 00:02:25,560 and pointing out what's wrong 65 00:02:25,560 --> 00:02:27,040 or what they're getting backwards 66 00:02:27,040 --> 00:02:29,760 or making mistakes about so that they can do it differently 67 00:02:29,760 --> 00:02:30,680 or more effectively. 68 00:02:30,680 --> 00:02:35,440 - Yeah, I mean, most people probably don't think about cities 69 00:02:35,440 --> 00:02:37,400 and communities supporting startups. 70 00:02:37,400 --> 00:02:40,000 I mean, is that, can you talk a little bit about 71 00:02:40,000 --> 00:02:40,920 why that's critical? 72 00:02:40,920 --> 00:02:43,040 Because I mean, most of the times when I think of startups, 73 00:02:43,040 --> 00:02:44,880 so you're always thinking of funding 74 00:02:44,880 --> 00:02:47,320 or how do you get the venture funding 75 00:02:47,320 --> 00:02:48,600 or how do you collect the team 76 00:02:48,600 --> 00:02:50,080 or how do you do the product market fit. 77 00:02:50,080 --> 00:02:51,880 But there's not a lot of air time 78 00:02:51,880 --> 00:02:54,880 that seems like given to the ecosystem 79 00:02:54,880 --> 00:02:56,640 that people come up in. 80 00:02:56,640 --> 00:02:59,640 - There's not a lot of air time with regard to 81 00:02:59,640 --> 00:03:02,160 what you just asked, which is a really good question. 82 00:03:02,160 --> 00:03:03,720 Why does it matter? 83 00:03:03,720 --> 00:03:06,800 And there's, and I say that because there's a lot of air time 84 00:03:06,800 --> 00:03:10,720 to tech, there's a lot of air time to be an entrepreneur, 85 00:03:10,720 --> 00:03:13,000 a lot of pop culture about how cool it is, right? 86 00:03:13,000 --> 00:03:14,440 The TV shows about Silicon Valley 87 00:03:14,440 --> 00:03:15,960 and magazines called Entrepreneur. 88 00:03:15,960 --> 00:03:18,720 But there really isn't a lot of discussion 89 00:03:18,720 --> 00:03:22,040 about the more fundamental economic considerations, 90 00:03:22,040 --> 00:03:24,800 such as one that I love 91 00:03:24,800 --> 00:03:29,440 is that you probably notice with whichever president 92 00:03:29,440 --> 00:03:32,760 is in office at the time, is in the White House, 93 00:03:32,760 --> 00:03:35,560 that president claims that they've created so many jobs. 94 00:03:35,560 --> 00:03:36,880 - Yeah. 95 00:03:36,880 --> 00:03:37,920 - The government doesn't create jobs. 96 00:03:37,920 --> 00:03:41,640 The government doesn't do squat about creating jobs. 97 00:03:41,640 --> 00:03:44,720 But I point that out because it's also therefore 98 00:03:44,720 --> 00:03:47,400 sort of misunderstood that companies don't really 99 00:03:47,400 --> 00:03:49,760 create jobs either, right? 100 00:03:49,760 --> 00:03:53,000 A big company like IBM, they already exist, 101 00:03:53,000 --> 00:03:53,880 they already established, 102 00:03:53,880 --> 00:03:56,640 obviously they employ hundreds of thousands of people 103 00:03:56,640 --> 00:03:59,960 and sure they might create some more jobs as they grow 104 00:03:59,960 --> 00:04:00,800 or become successful. 105 00:04:00,800 --> 00:04:05,120 But the fundamental reality is that roughly 70% of all jobs 106 00:04:05,120 --> 00:04:10,120 in an economy are created or recreated by startups, 107 00:04:10,120 --> 00:04:14,080 which is to say, look at AI coming along, 108 00:04:14,080 --> 00:04:18,080 the only way that we're gonna have jobs in an AI economy 109 00:04:18,080 --> 00:04:22,760 or an AI-based academy is because startups create 110 00:04:22,760 --> 00:04:25,240 the new technologies to create the new business models 111 00:04:25,240 --> 00:04:26,440 that are relevant to that. 112 00:04:26,440 --> 00:04:30,000 They create the new opportunities based on that innovation 113 00:04:30,000 --> 00:04:34,480 resulting in the next phase of humanity, frankly, 114 00:04:34,480 --> 00:04:36,120 which puts a bunch of people to work 115 00:04:36,120 --> 00:04:38,560 in artificial intelligence. 116 00:04:38,560 --> 00:04:41,760 So the fundamental reason it's really critical is, 117 00:04:41,760 --> 00:04:45,480 is if your city is struggling with jobs, 118 00:04:45,480 --> 00:04:47,880 it's struggling to have jobs. 119 00:04:47,880 --> 00:04:52,520 If you're only trying to attract big employers 120 00:04:52,520 --> 00:04:54,720 of trying to attract companies to employ 121 00:04:54,720 --> 00:04:58,360 the people in your community, it's gonna fall short 122 00:04:58,360 --> 00:05:00,480 because what you really need within your local community 123 00:05:00,480 --> 00:05:03,760 are the individuals who are starting new things 124 00:05:03,760 --> 00:05:07,280 that manifest in a net positive growth 125 00:05:07,280 --> 00:05:10,120 in all of the jobs that exist. 126 00:05:10,120 --> 00:05:13,880 And an appeal in the city in which you live 127 00:05:13,880 --> 00:05:16,800 for job creators to wanna be there 128 00:05:16,800 --> 00:05:18,880 so that the people that are in that community 129 00:05:18,880 --> 00:05:22,320 are able to get to work, not just in an employer 130 00:05:22,320 --> 00:05:24,440 or the company that you've moved there 131 00:05:24,440 --> 00:05:25,800 or that you've made successful there, 132 00:05:25,800 --> 00:05:28,720 but in fact, the entire job economy that's growing 133 00:05:28,720 --> 00:05:30,320 thanks to what's being done there. 134 00:05:30,320 --> 00:05:32,280 - All right. 135 00:05:32,280 --> 00:05:35,600 Well, so for cities or companies that are looking to, 136 00:05:35,600 --> 00:05:37,840 you know, where they're gonna set up shop 137 00:05:37,840 --> 00:05:39,720 another you used to be on the West Coast 138 00:05:39,720 --> 00:05:41,960 and what should they look for? 139 00:05:41,960 --> 00:05:45,080 And, you know, what was the appeal for you coming to Austin? 140 00:05:45,080 --> 00:05:48,840 - Ready to lead smarter and invest wiser? 141 00:05:48,840 --> 00:05:51,280 On the Executive Connect podcast, 142 00:05:51,280 --> 00:05:55,440 we unpack executive strategies for wealth and influence, 143 00:05:55,440 --> 00:05:59,600 hit the subscribe button now, don't just watch, act. 144 00:05:59,600 --> 00:06:02,760 - That's sort of an amazing question 145 00:06:02,760 --> 00:06:06,240 because if for, since you are, 146 00:06:06,240 --> 00:06:07,720 when you ask it today, 147 00:06:07,720 --> 00:06:10,680 I think most people appreciate the answer, right? 148 00:06:10,680 --> 00:06:12,960 Texas economy is booming, 149 00:06:12,960 --> 00:06:16,040 the Texas regulatory policies 150 00:06:16,040 --> 00:06:18,200 with regard to employment and companies 151 00:06:18,200 --> 00:06:20,920 is fairly progressive, 152 00:06:20,920 --> 00:06:24,320 frankly, in a positive and encouraging way for employers. 153 00:06:24,320 --> 00:06:28,840 And certainly we see a lot of tech and innovation 154 00:06:28,840 --> 00:06:31,880 and entrepreneurship relocating to Austin, Texas. 155 00:06:31,880 --> 00:06:33,280 But I say it's kind of an amazing question 156 00:06:33,280 --> 00:06:35,440 because I moved to Austin 16 years ago, 157 00:06:35,440 --> 00:06:38,360 and 16 years ago you could have asked 158 00:06:38,360 --> 00:06:40,600 any VC in the world where you would move 159 00:06:40,600 --> 00:06:44,040 and precisely zero of them would have said Austin. 160 00:06:44,040 --> 00:06:47,160 I actually moved to Austin for completely different reasons. 161 00:06:47,160 --> 00:06:51,040 I studied economics and I studied marketing. 162 00:06:51,040 --> 00:06:54,400 And so after about 12 years in Silicon Valley, 163 00:06:54,400 --> 00:06:58,560 I started to feel that ecosystem was maturing 164 00:06:58,560 --> 00:07:01,720 to a point that you might call it late stage innovation, 165 00:07:01,720 --> 00:07:04,240 which is to say it's really good at big companies 166 00:07:04,240 --> 00:07:06,840 in technology, now doing more things 167 00:07:06,840 --> 00:07:08,840 and certainly the venture capital is still there. 168 00:07:08,840 --> 00:07:12,480 But it's sort of lost its edge with regard to seed stage, 169 00:07:12,480 --> 00:07:14,560 idea stage startups. 170 00:07:15,600 --> 00:07:18,040 And so you have to look at the landscape of the country 171 00:07:18,040 --> 00:07:20,960 of the world and say, where else could be could be? 172 00:07:20,960 --> 00:07:23,840 Not is, but where else could be effective at that? 173 00:07:23,840 --> 00:07:27,480 And it's hard to argue that Austin is probably 174 00:07:27,480 --> 00:07:29,160 one of the best places in the world for it 175 00:07:29,160 --> 00:07:31,040 and will be for a very long time, 176 00:07:31,040 --> 00:07:33,360 not because of Austin in and of itself, 177 00:07:33,360 --> 00:07:36,560 but because Austin's within two hours 178 00:07:36,560 --> 00:07:39,880 of four major cities in the United States, 179 00:07:39,880 --> 00:07:41,680 which means it's got a lot of access to talent 180 00:07:41,680 --> 00:07:43,280 and capital and exposure, 181 00:07:43,280 --> 00:07:45,440 certainly has the benefits of the Texas economy 182 00:07:45,440 --> 00:07:46,960 in Texas ecosystem, 183 00:07:46,960 --> 00:07:49,840 but then characteristically Austin does have 184 00:07:49,840 --> 00:07:52,760 a lot of the qualities that Silicon Valley used to have, 185 00:07:52,760 --> 00:07:55,160 which surprisingly to people is in fact, 186 00:07:55,160 --> 00:07:58,960 things like sort of a hippie culture, 187 00:07:58,960 --> 00:08:02,760 a live music scene, it's this contrarian kind of 188 00:08:02,760 --> 00:08:06,160 counter culture and embrace to the arts 189 00:08:06,160 --> 00:08:08,560 that believe it or not is actually what encourages 190 00:08:08,560 --> 00:08:11,520 an inspires technology professionals and investors 191 00:08:11,520 --> 00:08:13,160 to take risks. 192 00:08:13,160 --> 00:08:15,400 That if you have a city or a region of the world 193 00:08:15,400 --> 00:08:18,200 that's really hot on tech, 194 00:08:18,200 --> 00:08:21,960 but completely abysmal with regard to the arts, 195 00:08:21,960 --> 00:08:23,880 you're not gonna be a startup ecosystem. 196 00:08:23,880 --> 00:08:25,040 You're just not. 197 00:08:25,040 --> 00:08:26,240 You've got software developers, 198 00:08:26,240 --> 00:08:29,080 you've got engineers, you got architects, that's fantastic. 199 00:08:29,080 --> 00:08:34,080 But or rather because it's the ability 200 00:08:34,080 --> 00:08:38,080 that we have in a community to see musicians take risks 201 00:08:38,080 --> 00:08:40,040 or to see artists be celebrated, 202 00:08:40,040 --> 00:08:42,160 even though their art might be terrible, 203 00:08:42,160 --> 00:08:47,160 or to see the city funding murals throughout the urban core, 204 00:08:47,160 --> 00:08:54,440 when you see the community taking risks on just creative works, 205 00:08:54,440 --> 00:08:59,120 it's an easy path for technology folks to say, 206 00:08:59,120 --> 00:09:01,320 hey, I could do that too. 207 00:09:01,320 --> 00:09:04,760 I could try something and even if it fails 208 00:09:04,760 --> 00:09:06,120 or even if it isn't very good, 209 00:09:06,120 --> 00:09:08,800 I'll probably be celebrated or recognized 210 00:09:08,800 --> 00:09:11,160 or supported in some way for that. 211 00:09:11,160 --> 00:09:13,400 Austin has all of that in spades 212 00:09:13,400 --> 00:09:16,920 and like I said, it's gonna continue to for at least 15 or 20 years. 213 00:09:16,920 --> 00:09:18,800 - Yeah, I mean, so what do you see 214 00:09:18,800 --> 00:09:21,000 is the next logical step in that. 215 00:09:21,000 --> 00:09:23,480 I hear a lot of bemoaning here in town about, 216 00:09:23,480 --> 00:09:26,680 hey, if you wanna get the next tranche of funding, 217 00:09:26,680 --> 00:09:28,000 we're right at starting things, 218 00:09:28,000 --> 00:09:30,000 but then if you wanna try and scale it, 219 00:09:30,000 --> 00:09:31,120 you gotta go somewhere else 220 00:09:31,120 --> 00:09:32,760 to one of the other big ecosystems. 221 00:09:32,760 --> 00:09:35,760 Is that still really a major issue here? 222 00:09:35,760 --> 00:09:38,240 And if so, is that common to other places, 223 00:09:38,240 --> 00:09:39,960 like maybe a Nashville or somebody, 224 00:09:39,960 --> 00:09:42,240 a place like that that's holding up. 225 00:09:42,240 --> 00:09:44,080 - Stun or ecosystem. 226 00:09:44,080 --> 00:09:47,000 - Nashville's a good, let me start with the last question 227 00:09:47,000 --> 00:09:48,320 to ask is Nashville's a fun one. 228 00:09:48,320 --> 00:09:50,200 Nashville's a fun one because in a sense, 229 00:09:50,200 --> 00:09:53,240 it's best appreciated is the opposite of Silicon Valley 230 00:09:53,240 --> 00:09:56,200 that it's really trying to be a tech ecosystem 231 00:09:56,200 --> 00:09:57,760 and trying to be a startup ecosystem. 232 00:09:57,760 --> 00:10:00,160 And it has some signals that it is, 233 00:10:00,160 --> 00:10:03,480 which frankly can sorta be misleading 234 00:10:03,480 --> 00:10:05,920 because in fact, what it really is 235 00:10:05,920 --> 00:10:07,800 is much more of an arts center. 236 00:10:07,800 --> 00:10:09,520 It's a huge music scene. 237 00:10:09,520 --> 00:10:10,360 - Right. 238 00:10:10,360 --> 00:10:11,760 - Second to LA. 239 00:10:11,760 --> 00:10:16,760 And it's almost too far in that direction to a fault. 240 00:10:16,760 --> 00:10:18,920 And so hopefully you can appreciate what I'm pointing out 241 00:10:18,920 --> 00:10:20,800 is you need both. 242 00:10:20,800 --> 00:10:22,240 You need both to do it well. 243 00:10:22,240 --> 00:10:25,800 And Silicon Valley was both, Berkeley and, 244 00:10:25,800 --> 00:10:29,920 you know, Hayton, Ashtbury and the protest against Vietnam, 245 00:10:29,920 --> 00:10:33,000 right, that's a lot of what led the groundwork, 246 00:10:33,000 --> 00:10:35,760 laid the groundwork for Silicon Valley to become 247 00:10:35,760 --> 00:10:40,760 innovative in the 70s and 80s, let alone the 90s and 2000s. 248 00:10:40,760 --> 00:10:41,840 You know, to sort of lost that. 249 00:10:41,840 --> 00:10:42,800 Austin's got it. 250 00:10:42,800 --> 00:10:44,520 And that's actually the answer to the first part 251 00:10:44,520 --> 00:10:45,800 of your question. 252 00:10:45,800 --> 00:10:50,800 Is it still true that folks that wanna scale 253 00:10:50,800 --> 00:10:54,480 have to go somewhere else for marketing 254 00:10:54,480 --> 00:10:57,600 or the experience to do so or the capital to do so? 255 00:10:57,600 --> 00:10:59,920 Yeah, unfortunately, it is still true. 256 00:10:59,920 --> 00:11:01,440 And yet it is changing. 257 00:11:01,440 --> 00:11:05,040 It's changing because it takes, 258 00:11:05,040 --> 00:11:09,000 it takes time for those experiences 259 00:11:09,000 --> 00:11:11,120 in that capital to manifest. 260 00:11:11,120 --> 00:11:13,040 In the startup ecosystem, for those of you 261 00:11:13,040 --> 00:11:15,880 in small business and real estate or in companies, 262 00:11:15,880 --> 00:11:20,280 you know, you tend to plan your cycles annually, perhaps even 263 00:11:20,280 --> 00:11:24,800 quarterly, maybe you've got a five year roadmap for things. 264 00:11:24,800 --> 00:11:28,200 In the startup world, it takes a good seven to 10 years 265 00:11:28,200 --> 00:11:32,040 for us to see things cycle, for innovation to drastically change 266 00:11:32,040 --> 00:11:36,600 into cycle out for investors to get returns on investments. 267 00:11:36,600 --> 00:11:40,560 So you can imagine how if the Austin startup ecosystem 268 00:11:40,560 --> 00:11:45,160 really started to boom again eight or 10 years ago, 269 00:11:45,160 --> 00:11:47,560 certainly existed before that, but it was a lot smaller. 270 00:11:47,560 --> 00:11:49,640 So it started to boom about eight or 10 years ago. 271 00:11:49,640 --> 00:11:51,680 We've really only been through one cycle. 272 00:11:51,680 --> 00:11:56,200 We're in the kind of in the middle of the second cycle, 273 00:11:56,200 --> 00:11:58,680 which means we're starting now to see a lot 274 00:11:58,680 --> 00:12:00,320 of new venture capital firms in Texas. 275 00:12:00,320 --> 00:12:04,480 We're starting to see emerging funds raise capital. 276 00:12:04,480 --> 00:12:07,640 We're starting to see existing funds raise 277 00:12:07,640 --> 00:12:11,000 their follow on larger capital rounds. 278 00:12:11,000 --> 00:12:13,520 And what's beautiful in that happening is that 279 00:12:13,520 --> 00:12:16,520 those people now also have more startup experience 280 00:12:16,520 --> 00:12:18,080 than they did 10 years ago. 281 00:12:18,080 --> 00:12:20,720 And so they're able to not just make better, 282 00:12:20,720 --> 00:12:22,240 more meaningful direct investments, 283 00:12:22,240 --> 00:12:27,240 but they're also more capable of appropriate advice 284 00:12:27,240 --> 00:12:29,880 and good direction and connecting the right people 285 00:12:29,880 --> 00:12:31,680 so that founders here could scale. 286 00:12:31,680 --> 00:12:32,960 I think it's gonna take another cycle. 287 00:12:32,960 --> 00:12:34,440 It's gonna take another five to seven years 288 00:12:34,440 --> 00:12:39,440 before we really start to see Texas comparable to New York 289 00:12:39,440 --> 00:12:43,280 or California with regard to direct localized capital 290 00:12:43,280 --> 00:12:45,320 investment, but we're getting there. 291 00:12:45,320 --> 00:12:47,120 - Yes, if you talk a little bit about that cycle, 292 00:12:47,120 --> 00:12:51,720 I've heard that the big exits from the early investors, 293 00:12:51,720 --> 00:12:55,440 there's a big exit and then a lot of them have liquidity 294 00:12:55,440 --> 00:12:57,120 and then they can go reinvest. 295 00:12:57,120 --> 00:12:59,320 Is that sort of like the natural cycle of things 296 00:12:59,320 --> 00:13:02,720 about how money flows throughout or the ecosystem? 297 00:13:02,720 --> 00:13:04,200 - Yeah, that's a talk a little bit about that. 298 00:13:04,200 --> 00:13:05,960 - Are you a high income professional? 299 00:13:05,960 --> 00:13:08,480 Looking for smarter ways to protect your wealth? 300 00:13:08,480 --> 00:13:10,880 The Texas Freedom Fund gives you the opportunity 301 00:13:10,880 --> 00:13:13,080 to invest in energy assets leveraging 302 00:13:13,080 --> 00:13:15,680 proven fracking technology and prime access 303 00:13:15,680 --> 00:13:17,080 to global markets. 304 00:13:17,080 --> 00:13:19,400 With strategic oil and gas investments, 305 00:13:19,400 --> 00:13:21,480 you can build real wealth while benefiting 306 00:13:21,480 --> 00:13:25,360 from tax advantages under laws dating back to the Reagan era. 307 00:13:25,360 --> 00:13:27,600 Take control of your financial future. 308 00:13:27,600 --> 00:13:32,160 Visit Texas Freedom Fund.executiveconnectpodcast.com. 309 00:13:32,160 --> 00:13:35,360 - Yeah, please in fact, because that's actually 310 00:13:35,360 --> 00:13:39,000 our greatest challenge in Texas if that's 311 00:13:39,000 --> 00:13:43,840 where most of your audience now is that most ecosystems 312 00:13:43,840 --> 00:13:48,880 throughout the world have a culture that tends 313 00:13:48,880 --> 00:13:53,640 to favor property, property development, 314 00:13:53,640 --> 00:13:57,480 property monetization and the like, 315 00:13:57,480 --> 00:13:59,240 which means what? 316 00:13:59,240 --> 00:14:01,080 It's easier for me if I have wealth. 317 00:14:01,080 --> 00:14:03,080 It's easier for me to buy a bunch of homes 318 00:14:03,080 --> 00:14:04,960 or to buy a property in development in real estate 319 00:14:04,960 --> 00:14:07,680 or to buy a property in developed for commercial use 320 00:14:07,680 --> 00:14:10,280 and lease and license that and benefit 321 00:14:10,280 --> 00:14:12,560 from the tax deductions, benefit from the appreciation 322 00:14:12,560 --> 00:14:13,600 that's so forth. 323 00:14:13,600 --> 00:14:14,600 Wonderful. 324 00:14:14,600 --> 00:14:16,480 That's a much more appropriate way to 325 00:14:16,480 --> 00:14:18,480 a mass and maintain wealth. 326 00:14:18,480 --> 00:14:20,320 The challenge is in my sector of the economy, 327 00:14:20,320 --> 00:14:22,080 that's a bad thing. 328 00:14:22,080 --> 00:14:25,760 We have to help shift the way from. 329 00:14:25,760 --> 00:14:30,760 Why? Because we've had 24 unicorns manifest 330 00:14:30,760 --> 00:14:34,680 in Austin in the last few years. 331 00:14:34,680 --> 00:14:37,240 The difference is that in a place like Silicon Valley, 332 00:14:37,240 --> 00:14:39,000 there's no room to grow. 333 00:14:39,000 --> 00:14:41,880 It's already massively developed, it's urbanized, 334 00:14:41,880 --> 00:14:43,840 it's expensive. 335 00:14:43,840 --> 00:14:47,480 And so you can appreciate how the opportunity 336 00:14:47,480 --> 00:14:50,640 in physical infrastructure is less meaningful 337 00:14:50,640 --> 00:14:54,400 in a place like Manhattan or in a place like Silicon Valley 338 00:14:54,400 --> 00:14:56,600 than it is in Texas. 339 00:14:56,600 --> 00:14:59,240 It's more expensive, there is a place to do it, 340 00:14:59,240 --> 00:15:00,280 it's more onerous. 341 00:15:00,280 --> 00:15:01,120 Which means what? 342 00:15:01,120 --> 00:15:03,560 Which means that when I exit from that unicorn 343 00:15:03,560 --> 00:15:07,200 rather than taking a seat back a little bit, 344 00:15:07,200 --> 00:15:10,480 maybe buying some property and just living off that wealth, 345 00:15:10,480 --> 00:15:14,000 I might as well reinvest it in technology. 346 00:15:14,000 --> 00:15:15,520 I might as well reinvest it in startups. 347 00:15:15,520 --> 00:15:17,480 I might as well reinvest it in companies. 348 00:15:17,480 --> 00:15:21,120 So you can appreciate how there's a bit of a catch 22 349 00:15:21,120 --> 00:15:24,160 in the sense that when it comes to a place like Austin, 350 00:15:24,160 --> 00:15:29,160 we need to teach the wealth class and a challenge in that 351 00:15:29,160 --> 00:15:33,520 is the wealth class tends not to like to be taught, 352 00:15:33,520 --> 00:15:36,560 tends to point out the fact that they're wealthy and successful. 353 00:15:36,560 --> 00:15:38,520 So what the hell do you know? 354 00:15:38,520 --> 00:15:41,320 Well, we know that startups are very different. 355 00:15:41,320 --> 00:15:47,120 And perhaps you'd like to consider investing in this kind of stuff, 356 00:15:47,120 --> 00:15:49,600 I need you to appreciate that investing in this kind of stuff 357 00:15:49,600 --> 00:15:52,240 is not at all like investing in a business. 358 00:15:52,240 --> 00:15:55,040 It's not at all like investing in property at all. 359 00:15:55,040 --> 00:15:56,040 (laughs) 360 00:15:56,040 --> 00:15:58,520 And if you come into the startup ecosystem 361 00:15:58,520 --> 00:16:01,120 with those expectations, you're gonna be disappointed, 362 00:16:01,120 --> 00:16:03,000 you're gonna be angry, you're gonna be frustrated 363 00:16:03,000 --> 00:16:04,520 'cause it doesn't work the same way. 364 00:16:04,520 --> 00:16:06,360 But I need to teach you why that's different. 365 00:16:06,360 --> 00:16:09,240 I need to teach you how that works because 366 00:16:09,240 --> 00:16:12,280 we do want you to shift that capital in this direction. 367 00:16:12,280 --> 00:16:16,080 One of the best ways to do it is to explore alternative uses 368 00:16:16,080 --> 00:16:21,080 of property rather than leasing property to co-working spaces. 369 00:16:21,360 --> 00:16:24,000 Why aren't we developing something along the lines 370 00:16:24,000 --> 00:16:26,560 of what's called a startup studio or a venture studio 371 00:16:26,560 --> 00:16:29,880 where you're investing in both the property 372 00:16:29,880 --> 00:16:32,960 and the companies or the innovations that are in there. 373 00:16:32,960 --> 00:16:34,800 And as a result of you doing that, 374 00:16:34,800 --> 00:16:38,920 you benefit from both, but you also mitigate the cost 375 00:16:38,920 --> 00:16:39,800 to your customers. 376 00:16:39,800 --> 00:16:43,480 So you're not running the property for as much on purpose 377 00:16:43,480 --> 00:16:45,520 because we all can't afford it. 378 00:16:45,520 --> 00:16:48,160 Instead, part of that is considered an investment 379 00:16:48,160 --> 00:16:49,400 in what's happening there. 380 00:16:49,400 --> 00:16:51,640 And so you benefit from the upside and the diversification 381 00:16:51,640 --> 00:16:54,200 of your portfolio while still having some of that stability 382 00:16:54,200 --> 00:16:57,000 in the property that you're working with. 383 00:16:57,000 --> 00:16:59,640 - Yeah, and I know Austin has some examples of this too. 384 00:16:59,640 --> 00:17:03,320 I mean, I'm thinking of different things in my head, 385 00:17:03,320 --> 00:17:07,400 but maybe we can talk a little bit about media tech ventures 386 00:17:07,400 --> 00:17:09,800 and kind of your point of view on this 387 00:17:09,800 --> 00:17:11,000 'cause I know you've been championing 388 00:17:11,000 --> 00:17:13,440 so many of these ideas from while now. 389 00:17:13,440 --> 00:17:15,720 And we've talked about this before, 390 00:17:15,720 --> 00:17:18,360 but proximity to certain things 391 00:17:18,360 --> 00:17:22,320 and the network effects of people being near one another. 392 00:17:22,320 --> 00:17:23,840 Like what are the things that, 393 00:17:23,840 --> 00:17:25,560 so like the goodness that you get out of 394 00:17:25,560 --> 00:17:27,480 the sort of model that you're talking about 395 00:17:27,480 --> 00:17:29,880 for a startup, computer system? 396 00:17:29,880 --> 00:17:32,520 - Yeah, let me start with sharing 397 00:17:32,520 --> 00:17:35,920 what our thesis was with media tech ventures. 398 00:17:35,920 --> 00:17:37,240 It was actually two things. 399 00:17:37,240 --> 00:17:41,800 Coincidentally is where we sort of started the conversation 400 00:17:41,800 --> 00:17:45,640 that you must have both the arts in the creative side 401 00:17:45,640 --> 00:17:48,280 and the technology and the innovation 402 00:17:48,280 --> 00:17:51,120 to actually have a vibrant startup ecosystem. 403 00:17:51,120 --> 00:17:54,080 Too heavy on one side or the other and it doesn't work. 404 00:17:54,080 --> 00:17:56,040 For example, Los Angeles is another good example 405 00:17:56,040 --> 00:17:58,840 of a very, very vibrant, very, very wealthy, 406 00:17:58,840 --> 00:18:01,160 very successful economy, 407 00:18:01,160 --> 00:18:02,760 but it ain't a startup ecosystem. 408 00:18:02,760 --> 00:18:04,360 You don't think it go into LA to do a startup. 409 00:18:04,360 --> 00:18:05,200 Why? 410 00:18:05,200 --> 00:18:06,760 'Cause it's very, very integrated 411 00:18:06,760 --> 00:18:08,960 and understands the music business model 412 00:18:08,960 --> 00:18:11,720 and the film business model and so on and so forth. 413 00:18:11,720 --> 00:18:14,800 But again, it's not at all like what we do in the startup side. 414 00:18:14,800 --> 00:18:15,920 But if you don't have both, 415 00:18:15,920 --> 00:18:18,480 if you don't have that creative aspect to what's going on, 416 00:18:18,480 --> 00:18:21,520 you don't inspire risk, you don't inspire creativity. 417 00:18:21,520 --> 00:18:26,520 So media tech in and of itself was an acknowledgement 418 00:18:26,520 --> 00:18:27,960 and encouragement of the fact 419 00:18:27,960 --> 00:18:30,080 that you have to have both things in place. 420 00:18:30,080 --> 00:18:32,360 And we can't do that, we can manifest that. 421 00:18:32,360 --> 00:18:35,920 We can invest in both creative productions 422 00:18:35,920 --> 00:18:38,920 and technology or innovation 423 00:18:38,920 --> 00:18:41,800 and doing so puts both in place in the economy. 424 00:18:42,960 --> 00:18:47,960 That one consideration isn't actually even something we invented. 425 00:18:47,960 --> 00:18:51,200 If you go back to the 1970s, 426 00:18:51,200 --> 00:18:53,760 gentlemen by the name of Peter Drucker, 427 00:18:53,760 --> 00:18:57,960 who was an economist, management consultant, 428 00:18:57,960 --> 00:19:01,920 very reputable, very well known in big companies, frankly, 429 00:19:01,920 --> 00:19:03,880 made the observation that only two things 430 00:19:03,880 --> 00:19:07,760 actually create value, marketing and innovation. 431 00:19:07,760 --> 00:19:10,520 So twist, twist the words marketing and innovation 432 00:19:10,520 --> 00:19:14,240 to media and technology and there you go, we stuck that together. 433 00:19:14,240 --> 00:19:19,240 So once we put the right cultural or social characteristics 434 00:19:19,240 --> 00:19:25,280 in the economy to make it possible, 435 00:19:25,280 --> 00:19:27,840 then you touch on Brian the things that you're talking about. 436 00:19:27,840 --> 00:19:32,840 That the second consideration is that most people 437 00:19:32,840 --> 00:19:38,320 fail to understand that Silicon Valley is not, 438 00:19:38,320 --> 00:19:41,600 actually not the best place in the world for startups. 439 00:19:41,600 --> 00:19:44,600 It's the best place in the world for some startups, 440 00:19:44,600 --> 00:19:49,600 particularly internet based, SaaS or consumer startups. 441 00:19:49,600 --> 00:19:53,800 And notice I'm not even using the word technology 442 00:19:53,800 --> 00:19:57,360 'cause once you mix it up or mess it up by saying technology, 443 00:19:57,360 --> 00:20:00,240 well, in fact, is biotech and farm is better in Raleigh Durham 444 00:20:00,240 --> 00:20:02,720 and clean tech and energy is better in Houston. 445 00:20:02,720 --> 00:20:04,480 You're not gonna find that stuff in Silicon Valley 446 00:20:04,480 --> 00:20:05,880 and you shouldn't. 447 00:20:05,880 --> 00:20:10,160 So it's this acknowledgement that one of the lessons learned 448 00:20:10,160 --> 00:20:14,600 is mistaking that a place like Silicon Valley is tech 449 00:20:14,600 --> 00:20:17,440 or it's ideal for tech or it's ideal for all tech. 450 00:20:17,440 --> 00:20:18,720 That's just not true. 451 00:20:18,720 --> 00:20:21,680 That is good for certain things which means what then? 452 00:20:21,680 --> 00:20:24,520 It means that in your ecosystem, in your community, 453 00:20:24,520 --> 00:20:26,400 in your city, there are actually certain things 454 00:20:26,400 --> 00:20:27,800 that you're gonna be good at and there's certain things 455 00:20:27,800 --> 00:20:29,480 that you're not. 456 00:20:29,480 --> 00:20:32,640 Dallas and Fort Worth to talk about Texas more holistically, 457 00:20:32,640 --> 00:20:36,960 for example, Dallas and Fort Worth are a great place 458 00:20:36,960 --> 00:20:39,720 for financial innovation in Texas. 459 00:20:39,720 --> 00:20:41,560 It's actually not really Austin. 460 00:20:41,560 --> 00:20:44,360 And so even if you think of a place like Austin 461 00:20:44,360 --> 00:20:46,880 as the best place for startups now, 462 00:20:46,880 --> 00:20:50,080 like my point about Silicon Valley, that's not true. 463 00:20:50,080 --> 00:20:51,520 It's good for some things. 464 00:20:51,520 --> 00:20:57,360 Dallas is fantastic for FinTech, a lot of banks, 465 00:20:57,360 --> 00:21:00,440 the new Texas Stock Exchange, NASDAQ is moving there. 466 00:21:00,440 --> 00:21:02,000 Where do you wanna do FinTech innovation? 467 00:21:02,000 --> 00:21:03,240 If you don't wanna be in New York, 468 00:21:03,240 --> 00:21:05,840 which by the way is the ideal place for it, 469 00:21:05,840 --> 00:21:10,120 not Silicon Valley, well you might consider Dallas over Austin. 470 00:21:10,120 --> 00:21:14,320 So the second thesis was appreciating that 471 00:21:14,320 --> 00:21:18,080 in developing a better startup ecosystem, 472 00:21:18,080 --> 00:21:20,840 we have to focus on the strengths and weaknesses 473 00:21:20,840 --> 00:21:22,880 of industry where you are. 474 00:21:22,880 --> 00:21:24,120 We have to acknowledge that there are things 475 00:21:24,120 --> 00:21:26,360 that are not gonna be good at and we have to be comfortable 476 00:21:26,360 --> 00:21:29,720 and capable of dismissing those things, dismissing those things. 477 00:21:29,720 --> 00:21:31,600 For example, when I see a lot throughout the world, 478 00:21:31,600 --> 00:21:34,240 there's everybody, everywhere wants to be an AI. 479 00:21:34,240 --> 00:21:38,040 Well, like it or not, a lot of your cities 480 00:21:38,040 --> 00:21:40,400 are gonna suck at AI and you need to be comfortable 481 00:21:40,400 --> 00:21:42,240 with the fact that you're not ideal for AI. 482 00:21:42,240 --> 00:21:43,640 Seattle's gonna be great at it. 483 00:21:43,640 --> 00:21:45,200 Texas is gonna be great at it. 484 00:21:45,200 --> 00:21:48,600 Nashville, maybe, right? 485 00:21:48,600 --> 00:21:52,360 Nashville, maybe in the sense of AI in music. 486 00:21:52,360 --> 00:21:54,840 Okay, see, there's a logical fit. 487 00:21:54,840 --> 00:21:56,160 When you don't have that fit, 488 00:21:56,160 --> 00:21:57,520 you can't just kinda make it happen. 489 00:21:57,520 --> 00:21:59,320 You can't just pretend. 490 00:21:59,320 --> 00:22:01,560 Because the entrepreneur class to founder class 491 00:22:01,560 --> 00:22:04,000 can't afford to take stupid risks. 492 00:22:04,000 --> 00:22:04,840 And I mean stupid risks. 493 00:22:04,840 --> 00:22:09,520 You can't afford to try to encourage or enable founders 494 00:22:09,520 --> 00:22:12,680 to do things that aren't appropriate there. 495 00:22:12,680 --> 00:22:13,520 Why not there? 496 00:22:13,520 --> 00:22:16,160 Because you don't have the mentors that know what they're doing. 497 00:22:16,160 --> 00:22:18,240 You don't have investors there that know what they're doing. 498 00:22:18,240 --> 00:22:20,320 You don't have companies that they can partner with. 499 00:22:20,320 --> 00:22:23,160 So why on earth would you try to encourage people 500 00:22:23,160 --> 00:22:24,800 to start things that aren't appropriate 501 00:22:24,800 --> 00:22:26,880 in an ecosystem where it doesn't make any sense? 502 00:22:26,880 --> 00:22:28,920 Those are the collisions that you mentioned, Brian. 503 00:22:28,920 --> 00:22:31,320 That you wanna put the right people in the right places. 504 00:22:31,320 --> 00:22:35,360 You wanna get the sectors that are appropriate, 505 00:22:35,360 --> 00:22:38,200 not just downtown, not just in the city. 506 00:22:38,200 --> 00:22:42,000 You want to get them into places where they're gonna talk, 507 00:22:42,000 --> 00:22:43,720 they're gonna socialize, they're gonna cross promote, 508 00:22:43,720 --> 00:22:45,680 they're gonna work together, they're gonna partner together. 509 00:22:45,680 --> 00:22:48,240 And out of that comes innovation in whatever sector 510 00:22:48,240 --> 00:22:49,600 it is that you might be great at. 511 00:22:49,600 --> 00:22:53,320 - Yeah, so let's talk a little bit about the founder class. 512 00:22:53,320 --> 00:22:57,400 You know, I know that you can't go anywhere in Austin 513 00:22:57,400 --> 00:23:02,400 without people talking about startups or collaborating. 514 00:23:02,400 --> 00:23:05,880 There's all sorts of ecosystems for this. 515 00:23:05,880 --> 00:23:09,600 But what's kind of the anatomy of a successful startup? 516 00:23:09,600 --> 00:23:12,160 I know you mentioned a lot about marketing 517 00:23:12,160 --> 00:23:14,280 and there's a lot of talk about product market fit. 518 00:23:14,280 --> 00:23:17,200 But somebody that wants to do this the right way, 519 00:23:17,200 --> 00:23:20,200 that wants to sort of do the lean startup approach 520 00:23:20,200 --> 00:23:23,280 or whatever the latest buzzwords are for this. 521 00:23:23,280 --> 00:23:26,360 What's a good approach for somebody to validate 522 00:23:26,360 --> 00:23:28,920 that this idea that they have really is something 523 00:23:28,920 --> 00:23:30,640 that the market wants. 524 00:23:30,640 --> 00:23:33,480 And then how do they go about sequencing their 525 00:23:33,480 --> 00:23:36,800 sort of their bats in their time to navigate their way 526 00:23:36,800 --> 00:23:38,560 to something successful? 527 00:23:38,560 --> 00:23:41,160 - So here's a great example of what I mean 528 00:23:41,160 --> 00:23:42,760 by being a contrarian. 529 00:23:42,760 --> 00:23:45,240 You're right, there's a lot of talk about founders 530 00:23:45,240 --> 00:23:46,840 in startups in Austin. 531 00:23:46,840 --> 00:23:51,840 And because of that, what you also see is a lot of negativity, 532 00:23:51,840 --> 00:23:53,800 not a lot of criticism, right? 533 00:23:53,800 --> 00:23:56,160 We're tech pros, for example. 534 00:23:56,160 --> 00:23:59,720 Right, you see that slur, frankly, a lot 535 00:23:59,720 --> 00:24:02,720 from the people who don't like that kind of thing. 536 00:24:02,720 --> 00:24:04,640 Well, here's what I'm gonna throw you for a loop. 537 00:24:04,640 --> 00:24:06,600 How do you understand what a startup actually is 538 00:24:06,600 --> 00:24:08,240 and what it takes? 539 00:24:08,240 --> 00:24:12,560 If I play guitar and I hook up with Brian 540 00:24:12,560 --> 00:24:15,240 and I hook up with my friend Sally 541 00:24:15,240 --> 00:24:17,560 and we start a cover band. 542 00:24:17,560 --> 00:24:20,720 What we have started is a business, not a startup. 543 00:24:20,720 --> 00:24:24,280 We are working with the existing business model 544 00:24:24,280 --> 00:24:25,240 for that business. 545 00:24:25,240 --> 00:24:27,560 We learn to play our stuff. 546 00:24:27,560 --> 00:24:29,760 We learn how to promote ourselves a little bit. 547 00:24:29,760 --> 00:24:31,800 We learn what venues to play at. 548 00:24:31,800 --> 00:24:33,480 We learn what kind of music people like 549 00:24:33,480 --> 00:24:35,000 and we learn how to make money with that 550 00:24:35,000 --> 00:24:37,560 either by producing some merchandise or selling tickets. 551 00:24:37,560 --> 00:24:38,560 That's a business. 552 00:24:38,560 --> 00:24:43,080 Starting a new business is not at all like a startup at all. 553 00:24:43,080 --> 00:24:47,600 The startup sector is, I know how to play triangle 554 00:24:47,600 --> 00:24:50,440 and I sort of know how to mess around with this move keyboard 555 00:24:50,440 --> 00:24:51,760 that plays a whole bunch of different sounds, 556 00:24:51,760 --> 00:24:52,960 a synthesizer kind of. 557 00:24:52,960 --> 00:24:54,760 (laughs) 558 00:24:54,760 --> 00:24:58,960 And you're like a grunge hip hop singer. 559 00:24:58,960 --> 00:25:00,000 What's a grunge hip hop singer? 560 00:25:00,000 --> 00:25:00,840 I don't know. 561 00:25:00,840 --> 00:25:02,440 It's just your thing, it's your vibe. 562 00:25:02,440 --> 00:25:05,560 And we get together and you love by triangle. 563 00:25:05,560 --> 00:25:11,800 And we think though that our genre, 564 00:25:11,800 --> 00:25:14,800 our style is gonna be much more compelling 565 00:25:14,800 --> 00:25:16,640 through TikTok videos. 566 00:25:16,640 --> 00:25:18,880 Neither one of us know how to produce TikTok videos. 567 00:25:18,880 --> 00:25:20,040 So what? 568 00:25:20,040 --> 00:25:22,680 We know that that's where we're gonna be hot 569 00:25:22,680 --> 00:25:25,760 'cause the niche for our grunge hip hop triangle music 570 00:25:25,760 --> 00:25:27,080 is really freaking small. 571 00:25:27,080 --> 00:25:30,120 However globally it's rather substantial. 572 00:25:30,120 --> 00:25:33,280 And so we're going to try producing videos 573 00:25:33,280 --> 00:25:35,440 until we figure out how to make it work. 574 00:25:35,440 --> 00:25:38,360 We're going to try producing a whole bunch of different music 575 00:25:38,360 --> 00:25:40,720 until we figure out what people actually like. 576 00:25:40,720 --> 00:25:44,080 That's classically or characteristically, 577 00:25:44,080 --> 00:25:45,360 a better example what a startup is. 578 00:25:45,360 --> 00:25:47,560 And so when you say who's the founder class, 579 00:25:47,560 --> 00:25:52,360 well the fact is the artist who's doing murals in downtown Austin 580 00:25:52,800 --> 00:25:54,840 is also part of the founder class. 581 00:25:54,840 --> 00:25:58,240 The musicians who are trying to make it work in this city 582 00:25:58,240 --> 00:25:59,640 and they aren't just covering music 583 00:25:59,640 --> 00:26:01,240 and playing at the bar on the corner, 584 00:26:01,240 --> 00:26:03,120 they're also part of the founder class. 585 00:26:03,120 --> 00:26:04,120 Yes, I'm sorry to say it. 586 00:26:04,120 --> 00:26:06,840 All of you people who think the tech bros are awful. 587 00:26:06,840 --> 00:26:09,920 The fact is people who do creative, 588 00:26:09,920 --> 00:26:14,160 innovative work whether it's in music or film or coding 589 00:26:14,160 --> 00:26:19,160 or apps or restaurants or food. 590 00:26:19,160 --> 00:26:21,600 You've heard of Siette in Texas, haven't you? 591 00:26:21,600 --> 00:26:23,600 A billion dollar freaking exit. 592 00:26:23,600 --> 00:26:25,000 It's not a business. 593 00:26:25,000 --> 00:26:25,840 Why is it not a business? 594 00:26:25,840 --> 00:26:28,960 It was a startup because they put together ingredients 595 00:26:28,960 --> 00:26:32,480 for chips that no one ever put together before, 596 00:26:32,480 --> 00:26:34,800 which arguably was probably dumb. 597 00:26:34,800 --> 00:26:35,800 Why? 598 00:26:35,800 --> 00:26:38,760 Because selling corn chips and potato chips is really, really easy. 599 00:26:38,760 --> 00:26:39,840 Well, they didn't do that. 600 00:26:39,840 --> 00:26:43,080 They didn't just make another product line selling chips. 601 00:26:43,080 --> 00:26:44,640 They went in a completely different direction. 602 00:26:44,640 --> 00:26:45,480 They were a startup. 603 00:26:45,480 --> 00:26:47,240 They had to figure out how to make it work. 604 00:26:47,240 --> 00:26:49,080 Those are startups and it's important to appreciate 605 00:26:49,080 --> 00:26:51,000 the difference because again, 606 00:26:51,000 --> 00:26:54,160 when you talk about the investor class or the real estate class, 607 00:26:54,160 --> 00:26:56,360 if you want to participate in the startup world, 608 00:26:56,360 --> 00:26:58,560 we're not just following the existing playbooks, 609 00:26:58,560 --> 00:27:00,920 we're not just following the existing business models. 610 00:27:00,920 --> 00:27:03,240 But that doesn't mean there isn't one. 611 00:27:03,240 --> 00:27:05,280 We do know what we're doing. 612 00:27:05,280 --> 00:27:08,640 The difference though is, in the business world, 613 00:27:08,640 --> 00:27:13,040 you could argue that we can be certain of success. 614 00:27:13,040 --> 00:27:15,680 That really the only reason that businesses fail 615 00:27:15,680 --> 00:27:19,920 is because those businesses don't have the experience 616 00:27:19,920 --> 00:27:22,040 didn't follow the business model. 617 00:27:22,040 --> 00:27:23,400 They're stubborn. 618 00:27:23,400 --> 00:27:27,440 There's some stupid reason that you open a restaurant where? 619 00:27:27,440 --> 00:27:28,880 Why would you open that restaurant there? 620 00:27:28,880 --> 00:27:31,560 Obviously, that's not going to work there. 621 00:27:31,560 --> 00:27:32,960 You're going to look at a restaurant and you 622 00:27:32,960 --> 00:27:35,680 can decide whether or not it's likely to succeed or fail. 623 00:27:35,680 --> 00:27:37,520 You can't do that with startups. 624 00:27:37,520 --> 00:27:39,720 And so really all we do with startups is, 625 00:27:39,720 --> 00:27:42,960 we reduce the likelihood of failure as much as possible. 626 00:27:42,960 --> 00:27:44,440 And so there are playbooks to do that. 627 00:27:44,440 --> 00:27:47,240 And that's why you hear things like Lean Startup 628 00:27:47,240 --> 00:27:49,240 or Product Market Fit. 629 00:27:49,240 --> 00:27:52,480 You hear things like Market Validation or Custom Validation. 630 00:27:52,480 --> 00:27:56,720 These are all techniques that we use to address the fact 631 00:27:56,720 --> 00:27:59,880 that we can't just write a business plan and shop that business 632 00:27:59,880 --> 00:28:03,040 plan around to the banks and get some funding and start a thing. 633 00:28:03,040 --> 00:28:06,360 Because odds are most of what we're going to do is fail. 634 00:28:06,360 --> 00:28:08,200 Most of what we're going to do along the way is fail. 635 00:28:08,200 --> 00:28:10,480 The music that we're putting together sucks. 636 00:28:10,480 --> 00:28:11,480 My triangle broke. 637 00:28:11,480 --> 00:28:12,080 What do I do now? 638 00:28:12,080 --> 00:28:14,000 I can't afford to do one. 639 00:28:14,000 --> 00:28:18,320 These things are going to happen that don't work out. 640 00:28:18,320 --> 00:28:19,760 We discover that we were wrong. 641 00:28:19,760 --> 00:28:21,440 TikTok videos are dumb. 642 00:28:21,440 --> 00:28:24,880 We should be doing Twitter live streams for our music. 643 00:28:24,880 --> 00:28:25,920 Well, who knew? 644 00:28:25,920 --> 00:28:29,720 We didn't know that until we discovered it, until we uncovered. 645 00:28:29,720 --> 00:28:34,320 And so instead, what we're doing is we're focused 646 00:28:34,320 --> 00:28:39,640 on finding investors, mentors and advisors, startup 647 00:28:39,640 --> 00:28:43,360 experienced folks who know how to avoid the mistakes, 648 00:28:43,360 --> 00:28:46,760 know how to avoid the pitfalls, know how to scale very, 649 00:28:46,760 --> 00:28:48,280 very efficiently. 650 00:28:48,280 --> 00:28:50,280 Marketing, for example, is one of those things. 651 00:28:50,280 --> 00:28:52,960 Marketing effectively is free. 652 00:28:52,960 --> 00:28:53,840 Everybody? 653 00:28:53,840 --> 00:28:56,360 Marketing effectively is free if you know what you're doing. 654 00:28:56,360 --> 00:28:59,600 And so in the startup world, we're looking for those people who 655 00:28:59,600 --> 00:29:02,480 know how to do the kind of things that are necessary to market 656 00:29:02,480 --> 00:29:07,280 a new innovation because it's rather silly for us to go spend money 657 00:29:07,280 --> 00:29:12,200 promoting it when we don't yet know exactly how it's going to work 658 00:29:12,200 --> 00:29:13,600 and whether or not it's going to work. 659 00:29:13,600 --> 00:29:16,320 But we still need those people who know what they're doing 660 00:29:16,320 --> 00:29:20,600 to iterate and try things and test things as efficiently 661 00:29:20,600 --> 00:29:24,080 and effectively as possible to eliminate the fails, 662 00:29:24,080 --> 00:29:27,240 really fastly, to start to get churned with regard 663 00:29:27,240 --> 00:29:29,520 to the stuff that works. 664 00:29:29,520 --> 00:29:32,200 Seed investors, by the way, angel investors 665 00:29:32,200 --> 00:29:35,000 or seed investors as opposed to venture capitalists, 666 00:29:35,000 --> 00:29:38,200 that distinction is critical because we need the seed angel 667 00:29:38,200 --> 00:29:41,080 investors who know that that's what we have to do. 668 00:29:41,080 --> 00:29:42,600 I'm going to take your money and I'm going 669 00:29:42,600 --> 00:29:45,120 to throw in a lot of things and see what sticks. 670 00:29:45,120 --> 00:29:46,160 Banks don't do that. 671 00:29:46,160 --> 00:29:47,920 Banks hate that. 672 00:29:47,920 --> 00:29:50,280 But angel investors, that's exactly what they do. 673 00:29:50,280 --> 00:29:51,280 And so we need them. 674 00:29:51,280 --> 00:29:52,640 And they're not the same as VCs. 675 00:29:52,640 --> 00:29:55,240 VCs are looking for things that are further along. 676 00:29:55,240 --> 00:29:56,480 They're validated a little bit. 677 00:29:56,480 --> 00:29:58,360 And so if you're in the venture capital world, 678 00:29:58,360 --> 00:30:00,040 I know you're not going to be happy with me just 679 00:30:00,040 --> 00:30:02,240 throwing money around to see what sticks. 680 00:30:02,240 --> 00:30:04,520 But we still need money to throw around to see what sticks 681 00:30:04,520 --> 00:30:07,080 in the startup ecosystem because that's the only way to try things. 682 00:30:07,080 --> 00:30:11,160 You might think of startups as effectively starting as R&D. 683 00:30:11,160 --> 00:30:12,920 How do you get things off the ground that are completely new? 684 00:30:12,920 --> 00:30:14,600 We have to fund R&D. 685 00:30:14,600 --> 00:30:17,440 Can I guarantee that my R&D is going to work out and be successful? 686 00:30:17,440 --> 00:30:19,240 Absolutely not. 687 00:30:19,240 --> 00:30:20,160 I can't. 688 00:30:20,160 --> 00:30:21,080 Absolutely not. 689 00:30:21,080 --> 00:30:23,440 But I can guarantee that if we don't do it, 690 00:30:23,440 --> 00:30:26,200 we won't find new solutions. 691 00:30:26,200 --> 00:30:28,640 So you only want to participate as an investor in the startup 692 00:30:28,640 --> 00:30:29,840 class, in the founder class. 693 00:30:29,840 --> 00:30:33,480 If you appreciate that you are helping fund R&D 694 00:30:33,480 --> 00:30:36,520 so that we can discover what is new and better 695 00:30:36,520 --> 00:30:38,360 than what we're doing today. 696 00:30:38,360 --> 00:30:39,360 Yeah. 697 00:30:39,360 --> 00:30:42,320 So I mean, if you are a aspiring startup person, 698 00:30:42,320 --> 00:30:46,200 there are other metrics you can look at to be able to measure these things. 699 00:30:46,200 --> 00:30:50,680 Austin has this much seed investment versus San Francisco versus Boston 700 00:30:50,680 --> 00:30:53,560 or whatever the other hubs are. 701 00:30:53,560 --> 00:30:54,880 Yeah. 702 00:30:54,880 --> 00:31:02,400 What's fun about this sector of the economy is that there isn't much study about it. 703 00:31:02,400 --> 00:31:07,480 Most most, if you appreciate the economic side of industry, 704 00:31:07,480 --> 00:31:12,240 most economists focus on either micro or macro economics in a broad sense. 705 00:31:12,240 --> 00:31:15,960 Or they focus on corporate development or workforce development. 706 00:31:15,960 --> 00:31:17,560 Or they're at a chamber of commerce. 707 00:31:17,560 --> 00:31:19,480 So they work for the city. 708 00:31:19,480 --> 00:31:23,560 So how many people actually study how startups work? 709 00:31:23,560 --> 00:31:24,560 Dozens. 710 00:31:24,560 --> 00:31:26,680 I mean, literally it's in the dozens. 711 00:31:26,680 --> 00:31:27,960 Are there metrics related to that? 712 00:31:27,960 --> 00:31:29,880 Yeah, there are. 713 00:31:29,880 --> 00:31:38,000 For example, if after seven years, we're not seeing venture capital coalesce. 714 00:31:38,000 --> 00:31:40,160 That's a red flag. 715 00:31:40,160 --> 00:31:44,400 How many times should we take a shot at fostering startups in our community 716 00:31:44,400 --> 00:31:49,040 and in our ecosystem before we acknowledge that the venture capitalists 717 00:31:49,040 --> 00:31:50,720 aren't showing up to fund them? 718 00:31:50,720 --> 00:31:52,880 Maybe something's wrong, right? 719 00:31:52,880 --> 00:32:00,840 Or if we have an incubator or an accelerator in our community, 720 00:32:00,840 --> 00:32:05,000 are we looking at the volume of businesses started, 721 00:32:05,000 --> 00:32:07,080 which is what's typical in a small business program? 722 00:32:07,080 --> 00:32:09,760 Or it's typical in a city program? 723 00:32:09,760 --> 00:32:12,720 Look at how many new businesses we've started. 724 00:32:12,720 --> 00:32:14,120 Banks look at that metric. 725 00:32:14,120 --> 00:32:15,640 Look at how many new businesses we've started. 726 00:32:15,640 --> 00:32:17,080 This is wonderful. 727 00:32:17,080 --> 00:32:20,000 Why the heck would I care how many businesses have started? 728 00:32:20,000 --> 00:32:23,480 It's really easy to get people to start startups. 729 00:32:23,480 --> 00:32:28,360 The more appropriate metric is how many succeed, how many create jobs, 730 00:32:28,360 --> 00:32:29,960 how many get acquired. 731 00:32:29,960 --> 00:32:32,760 And so we look at late stage metrics instead of early stage metrics 732 00:32:32,760 --> 00:32:39,120 that if you got an incubator and it's pumping out 100 startups every six months, 733 00:32:39,120 --> 00:32:42,600 I look at that and go, so what? 734 00:32:42,600 --> 00:32:46,360 How many of those have resulted in successful companies? 735 00:32:46,360 --> 00:32:51,720 And it's an important metric because we know that roughly 90% of all startups fail. 736 00:32:51,720 --> 00:32:54,280 And so when you have a startup program in your town, 737 00:32:54,280 --> 00:33:02,080 if 80% or 90% of all of those startups are still failing, 738 00:33:02,080 --> 00:33:05,720 red flag, maybe that program isn't doing a very good job. 739 00:33:05,720 --> 00:33:07,400 Maybe that program doesn't know what they're doing. 740 00:33:07,400 --> 00:33:12,760 Hopefully the city isn't funding that program because it's not making a difference. 741 00:33:12,760 --> 00:33:21,080 You see that the metrics indicate the successful development of a company, 742 00:33:21,080 --> 00:33:24,680 not the start or volume of things that we're getting going. 743 00:33:24,680 --> 00:33:29,120 And it's a little difficult to discern those things because it takes time. 744 00:33:29,120 --> 00:33:34,000 It takes at least a couple of years to start to discern whether or not the efforts 745 00:33:34,000 --> 00:33:40,080 that are had by angel networks, by venture capital firms, by startup development organizations. 746 00:33:40,080 --> 00:33:44,320 Takes a couple of years at least to discern whether or not they're effective or not. 747 00:33:44,320 --> 00:33:47,240 Luckily in a place like Austin, we're at that point, we're well beyond that point. 748 00:33:47,240 --> 00:33:49,760 We can tell now whether or not programs are effective, 749 00:33:49,760 --> 00:33:51,920 whether or not the city should be doing work. 750 00:33:51,920 --> 00:33:56,160 But if you think about it at large, Dallas isn't at the same point. 751 00:33:56,160 --> 00:33:58,320 San Antonio isn't at the same point. 752 00:33:58,320 --> 00:34:03,120 And so we're still looking at those ecosystems in Texas to figure out if they've got 753 00:34:03,120 --> 00:34:07,000 the right DNA, if they've got the right experiences, if they can put the right programs in place 754 00:34:07,000 --> 00:34:10,080 that are important for what those ecosystems have to offer. 755 00:34:10,080 --> 00:34:14,280 It's going to take some more time before we actually figure out whether or not they've figured it out. 756 00:34:14,280 --> 00:34:16,760 Yeah, and I haven't been tracking this as much recently, 757 00:34:16,760 --> 00:34:20,840 but I know Austin used to have like tech stars and places like this. 758 00:34:20,840 --> 00:34:23,680 I don't know if we ever had a Y-combinator class here or not, 759 00:34:23,680 --> 00:34:29,840 but do you find that if you can drop something like that into a different city 760 00:34:29,840 --> 00:34:37,280 that it's effective or is it really, are those really more phenomena that work in that location 761 00:34:37,280 --> 00:34:42,200 and the way that they operate maybe doesn't work in a different location? 762 00:34:42,200 --> 00:34:48,800 Yeah, that's a wonderful question because what we know with certainty is that your ecosystem needs 763 00:34:48,800 --> 00:34:51,160 a diversity of those programs. 764 00:34:51,160 --> 00:34:53,120 Now, what is the diversity? 765 00:34:53,120 --> 00:34:55,000 Who knows? It depends on the sector you have there. 766 00:34:55,000 --> 00:34:56,640 It depends on the experiences you have there. 767 00:34:56,640 --> 00:34:58,640 It depends on the culture you have there. 768 00:34:58,640 --> 00:35:06,120 That you touched on something meaningful that I hope people caught in your 10-sprime. 769 00:35:06,120 --> 00:35:10,640 You're right, we used to have a tech star here. 770 00:35:10,640 --> 00:35:13,200 What happened? 771 00:35:13,200 --> 00:35:22,520 That I argue, you can argue that Austin still sort of lacks what you would more accurately refer to 772 00:35:22,520 --> 00:35:25,360 as the incubator stage of programming. 773 00:35:25,360 --> 00:35:28,440 We've got a lot of accelerators and tech stars as an accelerator. 774 00:35:28,440 --> 00:35:31,680 Well, accelerators have to be able to work with something. 775 00:35:31,680 --> 00:35:36,960 Accelerators only exist when you've got a high volume of early stage startups that have been 776 00:35:36,960 --> 00:35:46,560 validated and now need growth capital, marketers, PR, sector access, that kind of thing. 777 00:35:46,560 --> 00:35:49,360 Because hopefully you'll catch it. 778 00:35:49,360 --> 00:35:50,360 It's in the language. 779 00:35:50,360 --> 00:35:51,960 It's an accelerator. 780 00:35:51,960 --> 00:35:55,080 Its purpose is to accelerate the stuff. 781 00:35:55,080 --> 00:35:58,920 If you don't have the stuff that's there or you don't have the people or the capital or the 782 00:35:58,920 --> 00:36:05,240 experience that knows how to do that, your accelerator is going to fail or fall sort of what 783 00:36:05,240 --> 00:36:07,680 it hopes to accomplish. 784 00:36:07,680 --> 00:36:09,840 Why do we have a lot of accelerators in Silicon Valley? 785 00:36:09,840 --> 00:36:15,320 Because they're at that stage where people know how to get things across that initial finish 786 00:36:15,320 --> 00:36:19,360 line to the point that I've got something that I'm ready to scale. 787 00:36:19,360 --> 00:36:23,720 Everyone knows how to start stuff there effectively and efficiently. 788 00:36:23,720 --> 00:36:26,040 This is not to say Austin doesn't know what it's doing. 789 00:36:26,040 --> 00:36:32,720 It's that again, Austin's only maybe seven to ten years into the first cycle of the new 790 00:36:32,720 --> 00:36:37,880 economy and it's going to take a couple of cycles before there's enough experience here. 791 00:36:37,880 --> 00:36:43,680 So what we lack or what we need more of are what you would appreciate or think of as incubators 792 00:36:43,680 --> 00:36:46,480 that are helping people start things. 793 00:36:46,480 --> 00:36:50,000 They're helping people learn how to do marketing without a cost. 794 00:36:50,000 --> 00:36:55,440 They're helping people validate ideas very, very quickly and efficiently that we need to 795 00:36:55,440 --> 00:37:00,800 get more founders in our ecosystem past that first tranche. 796 00:37:00,800 --> 00:37:05,400 And while we're referring to them as the founders that need to get to that point, hopefully 797 00:37:05,400 --> 00:37:09,680 recall what I said about teaching the investor class or teaching the wealth class. 798 00:37:09,680 --> 00:37:15,760 What we actually also need much more of is teaching the investors the different expectations 799 00:37:15,760 --> 00:37:17,560 at each of these stages. 800 00:37:17,560 --> 00:37:19,880 But again, if you want to invest in startups, that's great. 801 00:37:19,880 --> 00:37:23,720 But investing in a venture capital firm or through a venture capital firm is drastically 802 00:37:23,720 --> 00:37:25,720 different than being an angel investor. 803 00:37:25,720 --> 00:37:27,920 It's drastically different than being in a seed fund. 804 00:37:27,920 --> 00:37:30,600 It's drastically different than being in an angel group. 805 00:37:30,600 --> 00:37:36,360 And if you're not familiar with the difference is, I am telling you, we don't want you involved 806 00:37:36,360 --> 00:37:44,320 because you will screw up the process by being an investor who wants this kind of stuff 807 00:37:44,320 --> 00:37:50,840 when you're participating at this stage over here that you're misleading everybody by setting 808 00:37:50,840 --> 00:37:54,400 expectations that are inconsistent with the way things work at that stage. 809 00:37:54,400 --> 00:37:59,840 Pointedly, if you want to be an angel investor, you have to be ready to lose 90% of your money. 810 00:37:59,840 --> 00:38:02,360 You have to know how to very aggressively scale things. 811 00:38:02,360 --> 00:38:05,240 You have to know how to connect people very effectively. 812 00:38:05,240 --> 00:38:09,320 You have to know how to discern new inventions that are meaningful from new investments that 813 00:38:09,320 --> 00:38:10,640 are wasteful. 814 00:38:10,640 --> 00:38:12,640 Most people can't do that. 815 00:38:12,640 --> 00:38:15,880 And so if you want to be an startup investor and you're in that group of people who can't 816 00:38:15,880 --> 00:38:20,240 do that, go talk to a venture capital firm and invest through that venture capital firm. 817 00:38:20,240 --> 00:38:23,360 Do not be an angel investor, please. 818 00:38:23,360 --> 00:38:25,640 That discernment is critical. 819 00:38:25,640 --> 00:38:30,840 But it's critical because again, we can't enable the entrepreneurs and the founders to waste 820 00:38:30,840 --> 00:38:31,840 time. 821 00:38:31,840 --> 00:38:35,360 We can't enable them to make mistakes that are dumb mistakes. 822 00:38:35,360 --> 00:38:39,680 We can't put them in an environment where they're getting the wrong advice because they 823 00:38:39,680 --> 00:38:43,840 don't have the resources to make those mistakes. 824 00:38:43,840 --> 00:38:49,400 We want to be as clean and efficient as possible by connecting people in the right places. 825 00:38:49,400 --> 00:38:54,080 So Paul, I think a lot of our listeners are corporate executives or people that maybe 826 00:38:54,080 --> 00:38:59,240 are trying to make the foray into entrepreneurship. 827 00:38:59,240 --> 00:39:03,600 They probably are very effective at leading and managing large teams or organizations 828 00:39:03,600 --> 00:39:05,760 that somebody else has built. 829 00:39:05,760 --> 00:39:11,400 What advice would you give those folks if they're trying to make them lead to learn to go 830 00:39:11,400 --> 00:39:16,760 operate something from scratch and sort of growth, something from birth? 831 00:39:16,760 --> 00:39:22,360 And how are those skills different than what they're maybe used to exercising in the corporate 832 00:39:22,360 --> 00:39:25,760 world? 833 00:39:25,760 --> 00:39:29,680 Start with the last question, last part of your question. 834 00:39:29,680 --> 00:39:33,320 Appreciate again that my world is completely different than yours. 835 00:39:33,320 --> 00:39:41,160 You don't have any playbooks, there's no HR, there's no budget, there's no boss to make the 836 00:39:41,160 --> 00:39:44,120 decision or take the fall. 837 00:39:44,120 --> 00:39:47,640 It's all on you, all of it. 838 00:39:47,640 --> 00:39:52,960 You are a chief technology officer at a big company who would like to be doing startups. 839 00:39:52,960 --> 00:39:58,200 It is all on you, which means you better learn how to do marketing and sales and graphic design 840 00:39:58,200 --> 00:40:04,680 like right now because you are individually and solely responsible for that. 841 00:40:04,680 --> 00:40:05,680 You are. 842 00:40:05,680 --> 00:40:07,440 Does that mean ultimately that you have to do it all? 843 00:40:07,440 --> 00:40:08,760 No, of course not. 844 00:40:08,760 --> 00:40:14,440 But if you want to be in the startup sector, the fact is you have to be conscientious of 845 00:40:14,440 --> 00:40:17,480 your obligation and your responsibility to be able to do all things. 846 00:40:17,480 --> 00:40:22,000 One of the things that we have in the startup world is that it is your responsibility to 847 00:40:22,000 --> 00:40:24,840 take out the trash. 848 00:40:24,840 --> 00:40:26,480 You're not going to hire somebody to do it. 849 00:40:26,480 --> 00:40:29,800 Somebody clean up the office. 850 00:40:29,800 --> 00:40:34,960 Your job is literally everything. 851 00:40:34,960 --> 00:40:40,200 That's a big leap of faith for people who are used to or have experience or are comfortable 852 00:40:40,200 --> 00:40:46,640 with what their MBA taught them or what their HR department takes care of for them or what 853 00:40:46,640 --> 00:40:49,360 the process is in the company. 854 00:40:49,360 --> 00:40:50,360 None of that exists. 855 00:40:50,360 --> 00:40:51,360 It's all out the window. 856 00:40:51,360 --> 00:40:58,440 By the way, including the fact that you appreciate again why startups are the ones that actually create 857 00:40:58,440 --> 00:41:03,800 new jobs because in our world, our objective is to break your business model. 858 00:41:03,800 --> 00:41:07,120 Our objective is to put you out of business. 859 00:41:07,120 --> 00:41:08,800 It really is. 860 00:41:08,800 --> 00:41:11,160 We look at the way things are done and we go, well, that's silly. 861 00:41:11,160 --> 00:41:12,160 Why don't we do it differently? 862 00:41:12,160 --> 00:41:13,160 Why don't we do it better? 863 00:41:13,160 --> 00:41:14,160 Well, how do we do that? 864 00:41:14,160 --> 00:41:17,400 Well, we're going to have to take down the big existing companies that do it a certain 865 00:41:17,400 --> 00:41:18,880 way. 866 00:41:18,880 --> 00:41:24,920 So we quite literally have to think differently than the existing stakeholders in a sector, 867 00:41:24,920 --> 00:41:28,800 including can we completely change public policy? 868 00:41:28,800 --> 00:41:31,280 Maybe we should go through the government and break things. 869 00:41:31,280 --> 00:41:36,080 Maybe we should break the law for a little while. 870 00:41:36,080 --> 00:41:41,520 Is AI stealing content from other people? 871 00:41:41,520 --> 00:41:42,520 Yes. 872 00:41:42,520 --> 00:41:44,520 Is it illegal? 873 00:41:44,520 --> 00:41:48,840 I mean, technically in the United States, it's illegal, but it's not illegal in China. 874 00:41:48,840 --> 00:41:53,320 So if we want to build AI that is capable of competing and doing something cool in that 875 00:41:53,320 --> 00:41:55,040 sector, what do we do? 876 00:41:55,040 --> 00:41:56,440 Do we have to play by the rules? 877 00:41:56,440 --> 00:42:01,120 Or do we have to go, it'll sort itself out, right? 878 00:42:01,120 --> 00:42:03,600 You have to be comfortable with that. 879 00:42:03,600 --> 00:42:09,960 And ultimately, then, it tends to the first party question, how and where do you get involved? 880 00:42:09,960 --> 00:42:12,760 Don't go it alone. 881 00:42:12,760 --> 00:42:16,720 Don't try to start your own thing in isolation. 882 00:42:16,720 --> 00:42:21,000 There are lots of people like me, like Brian. 883 00:42:21,000 --> 00:42:25,560 There are lots of people like me who have experience in what it is that you would like to 884 00:42:25,560 --> 00:42:27,400 be doing. 885 00:42:27,400 --> 00:42:30,560 And you're kind of bringing us full circle, Brian, where we started the conversation, talking 886 00:42:30,560 --> 00:42:33,880 about media tech a little bit or talking about those collaborations or connections that 887 00:42:33,880 --> 00:42:36,080 we hope to make in an ecosystem. 888 00:42:36,080 --> 00:42:40,760 What you do is you figure out what sector it is that you want to be doing something, which 889 00:42:40,760 --> 00:42:42,280 again is not tech. 890 00:42:42,280 --> 00:42:43,520 It's not a startup. 891 00:42:43,520 --> 00:42:46,480 The sector is maybe it's real estate tech. 892 00:42:46,480 --> 00:42:48,040 Maybe it's music tech. 893 00:42:48,040 --> 00:42:51,440 See, it's real estate or it's music or it's pharma. 894 00:42:51,440 --> 00:42:53,840 And you want to go find that community. 895 00:42:53,840 --> 00:42:56,480 And that community is more than happy to embrace you. 896 00:42:56,480 --> 00:43:04,200 I assure you, because we are constantly looking for the executives and the investors and so 897 00:43:04,200 --> 00:43:10,800 forth that have experience in and want to change what it is that we're trying to change. 898 00:43:10,800 --> 00:43:12,120 We're trying to make better. 899 00:43:12,120 --> 00:43:15,800 And so you could literally just show up at that office space or that community space so 900 00:43:15,800 --> 00:43:21,720 that meet up and say, hey, look, I have an idea and I want to try something, but right now 901 00:43:21,720 --> 00:43:24,880 I work at Dell and I'm not really sure how to get started. 902 00:43:24,880 --> 00:43:28,320 And I guarantee you within 24 hours, you will have 10 people saying, well, here's what you 903 00:43:28,320 --> 00:43:29,320 could do. 904 00:43:29,320 --> 00:43:32,440 Why don't you work with me or do you know Brian, we should be doing this stuff together. 905 00:43:32,440 --> 00:43:34,840 You get plugged in very, very, very, very quickly. 906 00:43:34,840 --> 00:43:36,400 But you do it to be clear. 907 00:43:36,400 --> 00:43:39,920 You need to do it in the sector that makes the most sense because if you go show up at 908 00:43:39,920 --> 00:43:43,760 the startup hub, if you go show up at the tech center or you go show up at the innovation 909 00:43:43,760 --> 00:43:45,760 center, you're going to run into a business. 910 00:43:45,760 --> 00:43:49,440 A thousand different people doing a thousand different things. 911 00:43:49,440 --> 00:43:53,480 And that coming out of the executive sector, coming out of the corporate sector, that's 912 00:43:53,480 --> 00:43:57,720 going to mislead you because you're going to hear people give you advice based on the way 913 00:43:57,720 --> 00:43:59,800 it works in their sector. 914 00:43:59,800 --> 00:44:04,520 And that's not necessarily what's appropriate to what you want to be doing in your sector. 915 00:44:04,520 --> 00:44:06,720 Startups are not all the same. 916 00:44:06,720 --> 00:44:10,360 Startups are very, very different by context and by sector that they work in. 917 00:44:10,360 --> 00:44:14,400 Again, that should be very evident in Texas because working in the oil and gas industry 918 00:44:14,400 --> 00:44:17,320 is not at all like working in the music business, is it? 919 00:44:17,320 --> 00:44:21,540 So if you're doing tech in either one of those, you just take the tech advice and put it 920 00:44:21,540 --> 00:44:26,720 to work in oil when all of your experiences in music, no. 921 00:44:26,720 --> 00:44:33,280 You go talk to the energy guys or you go talk to the music people and they guide you as 922 00:44:33,280 --> 00:44:35,480 to how to do it most appropriately. 923 00:44:35,480 --> 00:44:38,560 Don't make the mistake of getting misdirected by the people that don't know what they're 924 00:44:38,560 --> 00:44:40,720 doing and whatever it is that you want to be doing. 925 00:44:40,720 --> 00:44:41,720 All right. 926 00:44:41,720 --> 00:44:42,720 Well, hey Paul. 927 00:44:42,720 --> 00:44:44,920 I think we're almost out of time here. 928 00:44:44,920 --> 00:44:49,280 Is anything you wanted to leave the listers with before we depart? 929 00:44:49,280 --> 00:44:54,480 I would only encourage that if any of this resonates with you, I don't just talk about 930 00:44:54,480 --> 00:44:55,480 it. 931 00:44:55,480 --> 00:44:56,480 I write about it. 932 00:44:56,480 --> 00:44:57,480 I expose it a lot. 933 00:44:57,480 --> 00:45:01,040 I'm known as Startup Economist and some of my website. 934 00:45:01,040 --> 00:45:05,920 If you just look up Startup Economist, I should show up on LinkedIn or Google or whatever. 935 00:45:05,920 --> 00:45:11,080 If you ever want to explore the upside down perspective that it takes with regard to your 936 00:45:11,080 --> 00:45:17,560 economy, your sector, your industry, the technology in that space, that's what I'd love to do. 937 00:45:17,560 --> 00:45:21,040 If you bring me a pitch for an idea, the first thing I'm going to do is I'm going to rip 938 00:45:21,040 --> 00:45:22,040 it to shreds. 939 00:45:22,040 --> 00:45:23,960 I'm going to tell you why it's wrong. 940 00:45:23,960 --> 00:45:28,320 Because again, in innovation and entrepreneurship, we're trying to help people avoid the mistakes. 941 00:45:28,320 --> 00:45:32,840 We're trying to help you avoid the likelihood that you're going to fail. 942 00:45:32,840 --> 00:45:37,680 It's not helpful for someone like me to just say, hey, that's a great idea. 943 00:45:37,680 --> 00:45:38,680 Good luck. 944 00:45:38,680 --> 00:45:41,000 Go talk to more customers and maybe find an investor. 945 00:45:41,000 --> 00:45:42,000 That's not helpful. 946 00:45:42,000 --> 00:45:45,440 I'm going to tell you what's wrong with it so that you can focus on the things you need 947 00:45:45,440 --> 00:45:48,960 to do to make it successful as opposed to wasting your time on the stuff that we already 948 00:45:48,960 --> 00:45:50,560 know doesn't work. 949 00:45:50,560 --> 00:45:51,560 Look me up. 950 00:45:51,560 --> 00:45:54,320 I'm happy to connect and I'd love to have those kind of conversations with everybody. 951 00:45:54,320 --> 00:45:55,320 All right. 952 00:45:55,320 --> 00:45:56,320 Hey, Paul. 953 00:45:56,320 --> 00:45:57,320 This is great, man. 954 00:45:57,320 --> 00:45:59,880 It's actually the time that I would have to do this again. 955 00:45:59,880 --> 00:46:00,880 Anytime. 956 00:46:00,880 --> 00:46:02,040 Same to you all. 957 00:46:02,040 --> 00:46:03,040 Look you up online. 958 00:46:03,040 --> 00:46:04,040 Cheers. 959 00:46:04,040 --> 00:46:05,040 All right. 960 00:46:05,040 --> 00:46:06,040 Thanks.