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Full transcript: Spark Capital VC Bijan Sabet on Recode Decode

“I think good VCs are probably 80 percent wrong, bad VCs are 100 percent wrong.”

The New York Times 2013 DealBook Conference in New York Larry Busacca/Getty Images for The New York Times

On this episode of Recode Decode, hosted by Kara Swisher, longtime VC investor and Spark Capital co-founder Bijan Sabet stops by to talk about what Kara says she sees too little of in Silicon Valley: Political action. Sabet invested in Twitter, Tumblr, Trello and Foursquare among many others.

You can read some of the highlights from the interview at that link, or listen to it in the audio player below. We’ve also provided a lightly edited complete transcript of their conversation.

If you like this, be sure to subscribe to Recode Decode on Apple Podcasts, Google Play Music, TuneIn or Stitcher.

Kara Swisher: Today in the red chair is Bijan Sabet, a general partner at Spark Capital and someone who I’ve known forever. He has invested in companies, including Twitter, Tumblr, Foursquare, Trello and Runkeeper. Bijan is also a vocal blogger and tweeter in the past couple of months, speaking out against our dear President Trump and his attempted travel ban, which is why I love Bijan. Thank you for coming to Recode.

Bijan Sabet: Thanks for inviting me.

We have so much to talk about, but let’s start a little bit about your background. Obviously, you’ve invested ... I’ve known you for a long time because I’ve written about a lot of companies you’ve invested in and you’re also a New York-based venture capitalist.

Well, I grew up in New York but my office is in Boston.

Right, Boston, I’m sorry. You’re East Coast based.

Yeah. We have an office here in San Francisco and New York but home right now is Boston.

Boston, but you’re East Coast based, not from here. Talk a little bit about how you got there, because most venture capitalists are here, a lot of the tech investment is here, obviously I’d love to hear the story about how you got to Twitter and things like that. Talk a little bit about your background. How did you get to be a Boston-based venture capitalist?

The quick version of this is, I’m a Long Island kid. After undergrad I came out here, I attended my first Macworld in ’91 and then packed up my hatchback and moved up here and I got a job.

Why? Why did you come here?

I was 21 and I was just blown away. I’d never been out here before, and then when I came out for my first Macworld I was just floored about what was going on here.

Were you a geek in high school? Why? I like to know the origins ...

My dad is a doctor but he was really into gadgets, computers, we got an Apple II early and I was a computer science major.

In college? Where?

At Boston College. This was always part of what I was interested in.

What did you like about it?

Making stuff, figuring out problems and just building things. We were adding modems to these Apple IIs early, figuring out how to talk to people around the planet. It was super exciting.

What did you hope to do? Did you want to create companies?

No, it was more of, I was 21 and I just wanted to write software and do something far away from home.

Right. What year would this be?


This was super, super early. AOL had just gotten started, Netscape didn’t go public for many, many years, what were you thinking of computers at the time that they were these little islands of computing? The network computers were happening then.

Correct, correct. It was pre-Wi-Fi, pre-commercial internet. I mean, I was on, I’m sure you can find it, I was on some crazy usenet groups back then but I wasn’t one of these amazing programmers, it was more a ticket for me to get to do interesting things and get out here.

I worked for this little company in Santa Clara for a short period of time called The Integrated Systems that made real-time operating systems, and then I went to Apple Computer in ’95. It was a dark time in Apple; all I wanted to do was work at Apple, but as soon as I got there I find out that somebody renamed the printer in our department “resume writer.” But I met a bunch of people there, great people and I got introduced to ...

Who was the CEO? Was it what’s-his-name?

The CEO at the time was Michael Spinler.

Spinler, that German. The German, oh my God. The worst CEO.

Yeah. I was in the Claris division. I don’t know if you remember all this stuff.

Sure. But you wanted to be there because Apple was so iconic.

Yeah, I wanted to be there. I was 24 or something and ... Yeah.

So the first disappointment?

First disappointment. But then I met three founders of Web TV and I joined ...


Yeah, Steve Proman, Phil Goldman and Bruce Leek, and joined Web TV. That was my first real startup experience.

That was in Seattle, right?

No, no, it was in Palo Alto.

It was in Palo Alto?


What was crazy Steve Proman doing then?

The idea of Web TV was to build a set-top box that connects everyday televisions and bring you the internet.

On your television?

On your televisions. It was a combination of Netscape and AOL, we had the dial-up service and we sold a box in retail to consumers.

I remember. I still have mine.

Do you? The idea was PCs at the time were thousands of dollars and we were going to make it so that it’s compatible with the internet for $199.

And then?

Well, it was tough, it was really tough.

Web TV, wow.

Yeah, but you know what? The first holiday there was so much hype and we didn’t meet the expectations but we started iterating, started building next-generation products, and then two and a half years later Microsoft bought the company for $400 million.

Right, which was a big exit at the time.

It was a big exit.

The concept was similar, that it was coming to the television, they had all those deals at the cable companies, all those hopes.

That’s right. I ended up becoming a biz-dev guy, working with Greg Maffei and Hank Vigil and investing in cable companies. I was this little punky kid trying to pretend to know what I was doing.

So, you were still out here or did you ...

I was still out here. Yeah, yeah. I came in ’91, and then after Web TV I stayed at Microsoft for about 365 days and then Steve Proman and a bunch of us from Web TV, I’d say probably 10 of us, started a company called Moxi Digital.

Of course.

Which was not the greatest company ever but it ...

Right. Explain what that did, for the people who don’t remember.

The idea was to build a digital server for the home.

It’s Steve’s interest forever.

Loves it, yeah. But Web TV, by the way, was amazing. Andy Rubin was at Web TV, it was an amazing place.

First they were General Magic and then they went to Web TV and elsewhere to actually be successful.

Right, right. Web TV, I thought, was great.

Steve was in General Magic too.

He absolutely was. Anyway, Moxi, we wanted to build a server for the home that would distribute audio, video, internet content throughout your house. We were a $60 million in our Series A in ’99 without any product or anything.

And then?

Then we spent it and learned a lot of lessons. I met Peter Currie ... Denny Rimer and Peter were investors in our company.

That’s right, the Barksdale Group.

That’s right. You had on Quincy [Smith] recently.

I did.

I listened to that podcast. Quince was our lead investor. That was when I first met him.

You were here doing the thing, the VE thing, the startups that overpaid and overvalued, so you learned a lot about that on that side.

I did. In that 10 years, the company was sold, we sold it in ’01, so I got here in ’91 and this place was a bit of morgue. When I left in ’01 it was also a bit challenging times, but along the way I met this amazing person, I got married. She was from the East Coast and after the whole Moxi thing she said, “Hey, I want to go back to Boston.” I said, “I’ll come with you.”

Right. What was your plan then? Because there are companies in Boston, obviously, there’s lots of them, but it’s not the center, it was not the center.

No, not at all. In that time is was pretty tough, but I knew a few folks in Boston, not many, one was this guy named Mike Hearn who was the VP of HR at Apple. He had moved back to Boston, and he was a recruiting partner at Charles River Ventures, and they hired me as an EIR. I joined Charles River Ventures at that time when I moved out there, and I became really close to this new partner over there named Santo, and Santo and I became ... we were like peanut butter and chocolate, and by ’04 we decided we wanted to start our own firm.

What was the thinking behind it? What was the idea?

It was a few things, we had this view that we wanted to invest in things we were passionate about, and most VCs at the time had this diversification measure where they had somebody who was the enterprise guy, somebody was the consumer guy, somebody was the telecom guy — they were all guys, by the way.

Yeah, I know that. I’ve noticed that recently. It continues. It’s fascinating.

We felt like we wanted to start a firm that we would only invest in things that we actually cared about, not necessarily that things would be only good investments.

Was there any areas of topic that you liked?

Yeah, our focus when we launched was consumer. At the time, consumer business, and this was not a real obvious thing at the time.

Sure, and not in Boston, for sure.

Not in Boston. Todd Dagres came, he was the co-founder from Battery, he had a great track record at Battery, and so the three of us launched Spark One in July of ’05, 12 years ago.

Right. Your concept, the differentiating factor is, you’re from the East Coast and you have a different attitude, I suppose. Did you really? What was your selling point to people?

To LPs or entrepreneurs?

To entrepreneurs.

I think what we tell entrepreneurs is that we had a different attitude when it came to working with founders; we wanted to think that we were obsessing about consumers. When I met David Karp, when he was 19 ...

The founder of Tumblr.

The founder of Tumblr, we were already obsessed about consumer and media. It wasn’t like we had to learn about why this was important or interesting, so I think our focus on this areas was the thing that set us apart.

Tell me about that Tumblr. That was a big investment. Twitter and Tumblr were two big investments that you did. Tumblr almost tumbled and then you sold it off to Yahoo, congratulations on that one, but it was very hot at the time. Talk about what the concept was and where you think you went wrong and why it had to sell.

Well, Tumblr, I felt, was this amazing product that allowed people to be fully self-expressive on the internet.

Right, and people had done blogging before and they had done websites, and there was tons of that kind of stuff, and many of which died.

Yeah. I think David was ... David is brilliant, he has this unique capability where he was ... artist plus he’s technical, so he could think of something and then build it on the weekend. Tumblr allowed people to express themselves fully in a very creative way and it really, I think, caught on with the New York creatives and then it just spread from there.

I think the simplicity of it was also part of the magic because before that you can use stale blogging products that existed and people started those and then they would leave those. Tumblr, I think, it was just so easy and so beautiful that it just kept growing and growing and growing. I guess, the only thing I would be able to maybe add on is I don’t think it tumbled. I think it was a great company ...

Well, you were running out of money.

We could have raised another round. Marissa paid 1.1 billion and felt like that was quite compelling, but I don’t think we would have been ... I think we would have had a perfectly good company.

Perfectly good company, but you sold it.

We did sell it.

Yeah. Why did you sell it?

I think at the time it just felt like ... David was the majority shareholder and I was on the board and we felt like this was something that we could either sell now or raise another round. We hadn’t really proven the business model, yeah, but we felt given the size of the user base, it didn’t feel farfetched to think that we could build a profitable business.

Actually, harder because right now with all this troubles, Google is going around controversial content, and Tumblr was full of that.

Yeah. I was told repeatedly from Marissa and others that the content that was edgier was not disproportionate to the rest of the internet.

Right, right, right, but for some reason people thought that.

I think people love to give David a hard time.

Yeah. You think?

I do.

What do you imagine is going to happen to it now?

That’s a great question. I’m amazed David is still there, it just shows that he has a love affair with Tumblr. He’s put up with all the craziness and reorgs, and Yahoo, and now Oath.

Yeah, Oath.

Oath. So, he’s still there. I hope that Tim really understands that they’ve built something special over there.

Talk about Twitter. How did you get involved with that? What did you see? You met David when he was 19 and saw something there.

Yeah, I met Twitter through Andy Rubin, Andy introduced me. Ev was at Google and I got connected to Biz first. I joined as a user at first and just became addicted, like all of us did, and just really wanted to meet the team, so Andy introduced me to Biz first and then Ev and then Jack and then I kept groveling to be an investor and they finally said yes.

Right, and you were very early into that?

Right, right.

What were you thinking was going to happen there? What was your thought when you ... because I think a lot of people want to know what was your decision, when did you go, “That’s what I’m going to put my money into”?

Well, I had never seen a product that had this combination of fun and utility, and that was a special part for me. Google has utility, but it’s not fun, and then there are plenty of things to do online that were fun but didn’t have utility, and I felt like Twitter was this first powerful experience that combined the two in a way that I hadn’t seen before. Plus, the founders are so compelling, and all of that combined, I just needed to figure out how to become an investor.

So you stayed in it. Are you still an investor?

No, I joined the board at the time. I left in ’11. The company was going through a process to gear up for a public offering and ... Spark is still a small shareholder in the company, we were the largest, and the Sabet household is still an investor.

How do you look at its trajectory of what’s happened, because there was a lot of promise and hype around Twitter, they had a lot of offers to sell to Facebook and others, and Google was interested, and then they went public and then went through so much management turmoil that it’s kind of fascinating — although it’s the same players pretty much, which is interesting, trading seats back and forth. How do you look at that now from being an outsider even though you’re not a principal?

Yeah. Look, there were countless times they could have sold the company. I remember six months after I joined the board, Facebook ... Dan Rosen and I had an understanding, sell the company for $500 million ...

$500 million, yeah. I wrote that story.

Then, Ev woke up and said, “I don’t want to sell the company,” and we didn’t sell the company. I was forever grateful, but he was the largest shareholder and that was critical, what he wanted to do.

Why did you want to sell it?

I didn’t want to sell it.

But you had an understanding?

Well, at that time Ev and the board felt like we should go figure this out, if Facebook really wants to buy the company ... I had felt like we had raised a little bit of money, we had a small user base at the time, it was a few million users, so it was like, if they’re willing to pay a significant amount for the company we should pay attention to it.

I asked Ev, “What do you think we should sell it for?” He says, “Well, if they offer us $500 million, I’ll take it seriously.” So I told Dan, “$500 million, we’ll take it seriously.” He said, “We’ll offer $500 million.” Then we all decided, we’re going to sleep on it, and the next day Ev ... I think he’s published a letter that he sent to me and Fred and Jack, but he woke up and said, “I don’t want to sell it.” That was it.

Right. Did you think that was a mistake?

No, I was a super glad. I guess, the reason I’m bringing that story up is that if you had told me then that this company would have hundreds of millions of users, it’s an amazing brand and worth ... today, maybe it’s worth $11 billion or something, I would’ve been ecstatic. The issue, I think, is about expectations. I think people hope to be bigger, faster growing, etc.

What do you think the problem had been? I think comparing it to Facebook was the problem.

I do too.

That was the original sin.

I do too. I do too. Look, Facebook is an extraordinary company, I think Twitter is still a very unique thing, I don’t think Snapchat’s growth changes the Twitter value prop for users or experience, I just think it’s a different thing and that it’s just totally different.

What happens to it if you’re an outsider now?

I’m an outsider. Look, I hope that the company stays independent. I really do. I think it can. It’s got plenty of money, by the way, it’s got zillions of dollars, and it has this amazing brand, people love it.

Yeah, especially President Trump. We can get to that later.

Oh my God.

We’ll get to that next.

Okay. I hope it’s independent forever. I do.

You think it will be?

That I don’t know. I really don’t know now, but I hope it is.

You don’t know? Because it had attempted to sell and then wasn’t able to.

I read that too.

Yeah. No, I wrote that too.

I know.

Then lastly, Foursquare, and we’ll talk about Trello later because that’s the more recent success you have, but Foursquare: another shooting star and it’s sort of wandering in the wilderness right now.

Yeah. It’s coming back. I don’t know if you’ve been keeping up with Dennis and whatnot ...

I’m trying, yeah.

But it’s definitely in a very good place. There were some scary moments with that company for sure where it looked like we were in real trouble, but I give a lot of credit to Dennis and Jeff and the team over there, they’ve really not only stabilized it but it’s growing very nicely. The business model is working, team is doing great, so I think Foursquare is really an exciting company right now.

Why did you initially invest in it? They’re very similar, I can see a very similar line in your investment theory.

Yeah, Foursquare, I felt like, was the most unique product to really get a handle on navigating a city and finding things out. Yelp never did it for me. I felt like the Yelp thing where it’s people you don’t know are telling you whether you should go eat at that sushi place wasn’t really compelling for me. Foursquare, it was about your friends telling you what was interesting or not interesting, and I always felt that was a more powerful way to discover new places.

What do you think went wrong there? What was it? Because it was so hot after South by Southwest, and it was everywhere, it was on the covers, what went wrong?

I think the competitive landscape for Foursquare just got harder. I think that Instagram, it wasn’t a competitor directly but indirectly it was because suddenly people were posting photos of having a cappuccino at this restaurant and all of a sudden that whole location thing was competing for people’s attention. And there were more products being launched that weren’t directly competitors but occupied a different space, and I just think it just became harder.

And they were playing around with the “mayor” stuff for too long?

Yeah, I remember you could be the mayor of places. I think people still love that stuff, they still have it, but it was ... that whole games part of Foursquare was a big part of it and I think had a life for people.

What should they have done? When you talk about getting scary, you have all these companies that were at junctures. Talk a little bit about that idea of junctures, difficult junctures where things happen.

Look, I think when a company ... What I think a lot of people don’t realize is companies rarely go up and to the right. These are hard, to get startups going. Foursquare, I think the hardest part was they had this massive early success, raised lots of money because the company was so promising and growing, and when things became leveled off I think that’s when you suddenly have a moment that you’ve got to deal with the hard issues, suddenly you’re not growing as fast as you were, you’ve got employees, shareholders, this whole industry staring at you, and it’s hard. It’s really challenging for any management team or entrepreneur to really deal with that.

What’s your role in that then?

I think I’ve evolved, but I think VCs have a role to help support the management team and help them get through it. I think the thing that Foursquare did was ... I think they could’ve sold the company, and they decided to really grind through it and figure out a business model, and they did it.

From all those different experiences — Tumblr, Twitter and Foursquare — what did you take away from it?

I think in all those cases, these were young founders, and I think that ... The two things I learned is this whole notion of pattern matching with VCs and all that stuff, I really learned that can be counterproductive. I think what works great for one company ... These are unique places with unique founders and unique cultures, and I think the thing ... I learned two things, one is that each company has to do it their way, and to be patient.

Tumblr, yes, we had a great exit — $40 billion dollars, whatever — but it was seven years. It was not like a YouTube situation or an Instagram situation, and I think you’ve got to be patient with these things. I think it’s too easy in this environment to expect an Uber thing or an Instagram thing overnight.

Well, we’ll get to Uber.

Okay. I think patience is critical.

All right. We’re here with Bijan Sabet, he is a venture investor with Spark Capital and he’s also become an activist, and we’re going to talk about that in a minute.


We’re here with Bijan Sabet, the venture capitalist who comes from Boston at Spark Capital. He’s invested in things like Tumblr, Twitter, Foursquare, Trello and Runkeeper.

We’ve been talking a little bit about his past investments. I want to talk about what you’re doing right now and then in the next segment I’d like to talk about where you think investments are going and some, maybe, more current ones. But you’ve gotten super political, and that’s unusual because as political as SIlicon Valley thinks it is, it isn’t at all. Not many people step out, and you’ve stepped out rather extensively around the Trump administration, especially around immigration. Talk a little bit about that and why you’re doing that.

Well, look, I think we caught up a few months ago, I think a lot of us were frankly surprised that he won, so I think there was this moment of, “Oh my God, this just happened.”

I remember you were ... I was not shellshocked. Remember we talked about it, I was like, “hmm.”

I think we were at Philz Coffee, correct?

Yeah, yeah.

I was definitely shellshocked. Then, there was this moment of like, “Well, give him time. Maybe the campaign rhetoric wasn’t really the thing.” Then, you and other investors say, “It’s serious, not literal craziness.”

Yeah, that was Peter [Thiel]. It wasn’t investors, it was one person.

Right. Then all of a sudden you realize that it wasn’t campaign rhetoric, he meant what he said. That hate and that fear that he was selling on the campaign was going to be policy, and then when that whole immigration, that Muslim ban happened, I remember feeling like, “Okay, we got to start getting organized.”

Were you political before that? Were you involved in the Clinton campaign?

I was involved in the Clinton campaign, I was involved with Tech for Obama.

That’s right, you were very close.

Yeah, but ... I don’t know. I’m a bit of a bleeding heart. I marched in D.C. as an undergrad for the first Kuwait war, so I have cared about the stuff, but I feel like right now it’s a time where people need to take a stand and step up.

Talk about that, because tech doesn’t do that. It’s always been famous for being nonpolitical. I’ll never forget Bill Gates telling me very early in Microsoft’s career, “We don’t have lobbyists.” Now they have 412 of them, being very much like, “That’s not us, we’re here making the world, we’re changing the world, we don’t need that stuff.” They still have that sort of attitude, or maybe I’m wrong, but I think that’s the case.

Yeah, yeah. Well, I think, one example, this whole Muslim ban, there was response from the tech community. On one hand, employees, I think, were pretty vocal even if it’s a walk-out of Google and you had lots of employees caring, the fund raising to the ACLU, a lot of it came from the tech community. You had this massive outcry of, “Hey, this is unacceptable behavior.” Then, you had a bit of a weak response from CEOs.

Yeah, a bit. You know how hard I was on them.

Right. I think that is the part that we need to really shine a light on, because I think that CEOs, even when they started getting involved, they started taking the position of, “Hey, this immigration ban is bad because it’s not good for business.” I think that’s not what the employees are upset about. I think with tech CEOs, we should just remind them that their customers and their employees matter more than their shareholders.

That’s an unusual thing to say. Tease that out a little bit, that idea, because I agree with you. I think their base ... If you talk about bases, their base are their employees and their customers, and that once they’re true to their alleged values, they do well.

That’s exactly right. The shareholder piece is really a second order bit in computer science. I think that’s the part that we just need to encourage and give them the license to actually speak up, because you know people like Tim Cook actually care about these issues, but for some reason I think they feel restricted in taking a point of view on this stuff.

A little bit is fear. I think they feel if they get alienated by this Trump administration that bad things will happen to their company, but what bad thing is going to happen to Apple?

Right, right, right. That’s just what I feel. I think I said that, that this is the richest people in the world getting cowed; if they’re cowed, the rest of us are screwed essentially.

I think that obsessing on the customer and your employees is going to really show us the right way to do it.

Right, and the product. Why don’t venture capitalists do it? Because you don’t hear a peep out of venture capitalists, really.

Well, I think the whole Muslim ban, you did see a bunch of VCs getting involved with fundraising for the ACLU and things like that.

You were pushing, correct?

I was pushing, yeah. A number of us were, for sure. But I think the opportunity is now for people to get involved, and I think we’re seeing it. I do, but I think there has been this response, that “start out a little bit slow with our industry,” but I think it’s picking up.

You do? I think it’s falling back.

Do you?

Yeah, I do. I think it’s just, “This was good for business, immigration.” But one of the CEOs told me, “We can’t complain about everything,” I’m like, “Why not? Why can’t you?” We’re going to complain about Muslims, we’re going to complain about transgender, we’re going to complain about the net, the privacy stuff, whatever, whatever encryption or whatever it happens to be, and some of the more social stuff, but they’re like, “We can’t ... Planned Parenthood, can we do that?” It just goes on and on and on, and these are sort of ... even though they’re not tech issues, they’re core to the tech constituency, which is interesting.

Well, that’s right, and that’s the part where I come back to before because, first of all, you should care as a citizen of this country, or this planet.

I think the other piece is CEOs should remember that their employees look up to them, and if they feel like their employer is not going to speak up and represent their interests, whether it’s transgender issues, women’s rights issues, the environment, immigration, I think it’s a missed opportunity for sure.

What are you doing? You’ve written about it. You tweet a lot, obviously, which I’m telling you, you’re unusual, you think you’re not but not many people ... It’s you and Aaron Levy making a joke every now and then, and he does it mostly with humor and it’s not clear. Do you know what I mean?

Well, Fred Wilson and Brett Felder are really involved in raising a bunch of money and speaking up, but I think it’s shining a light on this issue and getting other folks involved.

I think that one challenge I am hearing from folks is a bit of, how do I help? How do I get involved? It seems like there’s so many different ...

You got Sam Altman doing something, Mark Pincus is up to something, everybody is up to a different thing.

Right, right.

How do you think tech should be involved and what should be the big issues?

Well, I think there’s a few things. The tech community, I think we had it really good with Obama, and I think there was this shock that I mentioned that we really didn’t think this was going to happen, the unimaginable happened, but I think it was a wake-up call as well. I think the tech community didn’t really pay attention to what Trump voters were thinking about and we were doing our own thing, to some extent.

This is a complicated issue, where on one hand, we’re doing our own thing, we didn’t expect this to happen. And then now that it’s happened, how do we engage? How do we reach out? How do we have a conversation with people that feel disenfranchised? How do we speak up for these issues that should be important to all of us?

This whole thing where Congress allowed ISPs to sell your data, we should all care about that, that’s not a ... I don’t think Trump ran on that. That wasn’t a swing state hot issue or a litmus test. So I think there’s plenty of issues that we can connect on, whether it’s minimum wage, the environment, consumer protection, civil rights. I don’t think these are partisan issues.

How does that happen? Because there seems to be a lot of organizing but not a lot of doing. I’ve had so many lunches with people, “I want to do this.” Different people are starting PACs, it’s typically ... One person was like, “We should have a Koch brother kind of approach.” I’m like, “But there isn’t someone like that in tech. There’s like 90 different voices screaming at the same time.” How do you organize?

Well, I think it’s not one silver bullet. I think we need great people to run for office. I’m wondering if you’re going to run or not. If so, let me know because I would love to be supportive. I think it’s multifaceted. I think as an industry we need to engage, I think we need to energize people running for office that really give ... Can I curse on this show? I don’t know.

Yeah, you can. Please do.

Okay, that really give a shit, and I think we have to not be afraid. I think there is this level of fear about speaking up and getting involved.

What about your founders? Do you feel like you get hurt by being so vocal? Because you are one of the more vocal people.

Hurt in what way?

That startup people say, “I don’t want you to be quite so blabby about politics.”

Nobody said that. I haven’t heard it. I haven’t heard it.

Do you think it helps you?

Well, that’s the part where I think it does because I think there is a groundswell of shared concern. I don’t think there’s this radical left-wing fringe that cares about these issues. I think most of us care about these issues, and so I think speaking up, if it gets another person talking and another person talking and organized, I think it’s a good thing.

What are your plans to do for the next election? Are you going to become more political?

I hope so.

Such as?

I think it’s all of the things we talked about, getting the tech community engaged with everyday issues, getting involved in civil rights issues, helping raise money, helping good people run for office. I think that’ll be ...

What is your top issue? Is it immigration? Is that the one that really set you off, or is there any other?

Immigration was one that I ... certainly, remains one I care about, but for me it was not about this whole immigration for getting more workers.

“Let’s get our workers in here.”

It was more of a civil rights issue to some extent, banning people on religion felt like that was just wrong, and the courts agreed and everything else. I think civil rights, broadly speaking, is something I’m quite passionate about.

Do you have any hopes for this administration? Because there’s so many issues — self-driving cars, changing workplace, the government has to weigh in on health care. Do you have any hopes for this administration, or what do you feel like they should be doing right now?

This administration?


I think start with telling the truth would be great. I’m not very optimistic about this administration. What I am optimistic about is that I think that people realize the stakes are higher than they imagined, this wasn’t campaign rhetoric. Our side didn’t win. We don’t have a moderate running the country. I think people will get energized for the midterms.

I think what happened, for example, on the health care thing that failed was that there was a grassroots effort that got involved at Town Hall meetings and things like that. This kind of thing is, whether it’s in social media or at a Town Hall, I think it’s all part of the people involved.

Is the government capable of dealing with some of these big issues that are coming up? I’m thinking about health care, cars, digital privacy, all kind of things. Are the government people in place to be able to navigate it because that’s this next couple of years? This is the kind of stuff that has to be decided.

I think they’re really hard issues. Minimum wage is a really big deal ...

New sharing economy and how workers are looked at, automation, robotics.

Well, you have Mnuchin saying that robotics is not going to be a threat for 50 year.

Bijan, are robotics going to be a threat?

Yes, it already is! It already is. That was a crazy remark that he said.

I think step one is you have to take these challenges seriously, and then step two is get great people working on it.

What do you think the most critical issue with that is? Is it cars, is it infrastructure, is it robotics? What are you looking at?

You mean as a venture capitalist or as a ...?

Both, as a citizen.

Look, I think as a VC, we’re constantly drawn to people that are creatively trying to invent new things and new ideas, and I hope we continue to do that for a long time. But I think we are at a really important stage where this administration is taking us, where climate change ... we’re actually debating whether climate change is a thing, the EPA is being dismantled ... I think we’re at Defcon four.

Yeah, okay. All right, when we get back we’re going to talk a little bit about where tech is going and where tech investing is going with Bijan Sabet, who is a venture capitalist, general partner at Spark Capital.


We’re here with Bijan Sabet, who is a longtime venture capitalist, someone who I’ve known for a long time. We’re talking about politics, about his past investments, let’s talk about the now in tech. Where are we now?

I talk to a lot of venture capitalists and it seems like a little bit of a fallow period, maybe it’s just me, I’m just bored out of my mind or something, but what do you see as the big areas of tech happening right now? Because we’ve got these big companies, Apple, Facebook, Google, Amazon, Microsoft is still there, obviously it’s enormous, and then you have a bunch of smaller companies and some upcoming ones, but it seems quiet right now. Maybe I’m wrong.

I understand your point. I’m very optimistic. We really believe in this whole David versus Goliath thing. I think if we just let big companies dictate the pace of innovation, we’re going to be bored out of our minds. But I see, if anything, the audacity of entrepreneurs are thinking bigger than ever. We were the first investors in Cruise, which sold their company to General Motors, that we believe is the leader in autonomous vehicle technology ...

Talking about Cruise, you sold it?


Why did you sell it?

It was just ...

A lot of money?

It felt like a really compelling offer. But, I guess the thing that I wanted to mention is when we started Spark there was no iPhone, there was no App Store — people were building apps, and there’s nothing wrong with apps, apps have changed the world — but to think that we’ve now come to a place where not only we have an iPhone and an App Store, but they’re fairly ubiquitous, and now people can think about self-driving cars. We were the lead investor in Oculus, to think about virtual reality ... These are our big, big ideas and it gets me terribly excited.

You’re all over the place, Cruise, Oculus, Tumblr, and selling, you sell a lot, you seem to sell a lot, can you ... I’m talking about big companies being started now. Uber, of course, was one of those, or Airbnb, that people think could remain independent. Assess the Uber situation. If you were a venture capitalist there right now ... I don’t know, are you in it?

I’m not in Uber.

You’re one of the few. What happened there and what do you imagine is going to happen?

Well, look, it’s crazy what’s happening over there. I guess, this whole broke culture has been ... you’re seeing it for all that it’s worth, and it’s not pretty.

I’m not an investor. I do know what’s going on in the boardroom. I know there are talented people on that board. I imagine they’re taking this very seriously and they should be really concerned.

What would you do?

I would not be a happy camper right now. Look, there’s plenty of ways to make money in this world, and we have companies that are doing great work. Are they all perfect? No. But what I’m hearing, if even part of it is true, I’d be really deeply disturbed.

How would you fix that? How does one fix a company that’s troubled? You’ve been involved in all kinds of different situations.

Well, I think step one you have technology, whether that’s the problem, and I think you’ve got to acknowledge the problem and then have a real plan to fix it.

Look at this whole Fox News craziness, with this cover-up of the stuff. The thing I read the other day was their response was they didn’t call the EHR hotline, that’s criminal to me.

Because that’s the thing one does when one gets sexually harassed is call a hotline.

Right, right. I think it’s really acknowledging there’s an issue and then dealing with it.

If you’re at a company where the CEO is behaving badly, you have to acknowledge, is that a CEO problem or is that something else? So I think step one is identify the problem.

How hard is that as an investor when you have a situation like that?

Look, it’s never easy if you have a ...

Because you want to defend them. It’s interesting ... I think I gave Bill Gurley a hard time today, it’s like he’s silent and he usually lectures everybody about how they should behave, and then suddenly falls silent when he’s got problems in his own house, which is interesting.

Yeah, yeah. Look, I’ve seen where people have gone after art companies, and some VCs have gone after were investors and Postmates ... and I love what Sebastian is doing over there and VCs have gone after him publicly. I don’t understand this thing, but the thing we’re drawn to are entrepreneurs who are doing their best to do great work and it’s not just about making money. I think if you have a situation where the CEO is doing terrible things, you gotta deal with that.

Yeah, got to deal with it, but they don’t. It seems like they indulge more than ...

Well, I think this will be a test. I think at this level if there’s no change, it would be surprising.

Not to me, but all right. Okay. We’ll see what happens. What are else are you interested in? You’ve been in Trello, that just had a recent outcome for you. Talk about why you’re in enterprise because that is an enterprise, right?

Right, right.

Consumer enterprise.

Consumer enterprise, yeah. I am really excited about what’s happening in the workplace — not because I came out of the enterprise world or anything, as I mentioned Spark started with this consumer mindset — but I think the iPhone in some ways instructed us there as well, because you had a situation where consumers or workers were making their own decisions. For a while, certain people were carrying two phones, their company was giving them a BlackBerry and then talking with an iPhone because that was what they preferred to use, and I think we’re now seeing more of that where end users within the workplace are making their own decisions. So we’re investors in Slack, and Slack is the same thing, people decide to use Slack on their own and then it grows from there.

Trello had the same behavior. Trello is this beautiful Tumblr-like experience for a group collaboration, and that’s what we’re drawn to, is people building these products for consumers that happen to be at work.

What do you like about Slack?

I love Slack. Do you Slack?

Of course! Our whole company is on it.

Awesome. We love Slack. Slack, Slack.

Why didn’t it sell?

Phil Stewart wants to go all the way, and we’re big believers.

Were you in when it was bad Slack, before it was Slack, game company.

We were not in the game company.

No, you just came in afterwards. Yeah. What do you like about that? Bad Slack, I don’t know what else to call it.

Yeah, yeah.

What was it called? I went up to Vancouver to write about too, and I’m blanking.

It was a multiplayer game.

Yeah, multiplayer game, he loves ... Flickr started off as a game company. He loves that. He said he should start more game companies.

I told Stewart, “If you ever build another game company, we’re in.”

“I’m staying in until he screws that up and starts another company.” Would do you like about that? Again, of all these, what’s your thematic venture thesis?

Well, I think the thing about Slack in particular, and we have three offices so we see it firsthand, it really feels like we’re connected in a way that is fun. We have channels on Slack that’re absolutely ridiculously and hilarious and we have ...

Yeah, like Vox Media.

What’s your most ridiculous?

I don’t pay attention to any of them. I’m way too old for that stuff, but there’s a ... It’s everything, every single possible weird iteration of interest.

Yeah, but I think it’s a product that the end user inside the workplace is delighted. I think that’s the piece that ... We see it as users, we’re happy to be investors, but it’s people you slack every single day, and that’s inspiring to us.

What else is interesting you right now? What do you think is important? You were in Lily.


What happened to Lily?

Drones are hard.

I like that “ugh.”

Drones are hard.

Drones is hard.

Drones is hard.

Okay. Why?

Although, I was flying a drone this morning out by the Bay Bridge with some people right outside your office.

Hardware is hard. These are complicated systems. It’s not just building a website. You’ve got to deal with manufacturing and supply chain and all these things. We’re in a number of exciting hardware companies, some I’ve mentioned, others we haven’t talked about, and these are substantial projects, and the Lily one is a heartbreak. I think that product is exactly what this market needs, but we’re unable to deliver.

Why pull the plug? Because you couldn’t deliver or because there was no business?

The financing became too difficult given the engineering challenges. That combination was too hard.

Will there be a personal drone?

I think there will. I don’t even think it’s a drone, I think it’s the evolution of the camera, I think it’s a flying camera.

But which was Lily?

Which was Lily.

Right, right. Do you imagine it coming back or just going bankrupt?

Lily itself? No, Lily itself is not going to come back, but I think it’s inevitable.

Why were you so hopeful there then? Just because you like the idea?

Well, current products today are really aimed at people that want to be like pilots. They’re more around piloting and flying than photography, and I feel like, or felt at the time and still believe, that we’re drawn to creative products and creative tools, and the evolution of the camera is going to be this kind of thing. Photos and videos that you take from a flying camera are epic by nature, and I think people are drawn to them. I know I am.

Did you lose a lot of money on that one?

Yeah, we lost money.

Would you do it again?

We lost all of our money.

All of your money?


Would you do it again? Did everyone get their money back? I know there’s some controversy.

No, no, no. The users are getting their money back.

They’re getting their money back?

They’re getting their money back. Yeah.

So an execution problem or just “hardware is hard,” which is kind of ...

I have respect for everyone who put in a tremendous amount of blood, sweat and tears. I’d rather be a little shy on this one, but it was a complicated situation.

All right. What else are you interested in? Robotics, do you have anything in robotics? If you could invest in anything right now, what would it be? And you can invest in anything right now.

Yeah, yeah. Well, there’s some stuff we don’t do — biotech and stuff — but we’re looking for people that are looking to do substantial things that create new markets.

I think the thing that we love the most is ... If you asked me what the market size is for a 140-character messaging service, I couldn’t give you an answer for that ...

Neither can Twitter at this point, but go ahead.

Come on! But I couldn’t tell you what the market size is for virtual reality, we don’t really pay attention to market size, we care about amazing ...

What idea just compels you right now that you say ... Obviously, I just told you when I overheard the Uber driver was obsessed with life extension, but that’s typical of a young man in San Francisco. It’s not even close to dying to talk about dying because they’re so narcissistic. Is there some area that you’re like “hmm”?

There’s a bunch of areas, but one in particular we’re think about is the impact that social has on things like education and health care. We’ve made a lot of investments in social when it comes to media, or social when it’s come to the workplace with Slack and Trello. I think you’ll see exciting things in consumer advocacy, around health and education.

Yeah, the lack of knowledge is massive.

It’s a big deal.

It’s weird and it’s what people need actually.

Let’s finish up talking a little bit about Twitter and Donald Trump, how do you feel? Do you feel responsible, Bijan? Because I blame you and Jack Dorsey. What do you think of that?

Look, I think that ...

He’s using it! We’re governing via Twitter right now. He is governing via Twitter.

Do you think he wouldn’t have won the election if it wasn’t for Twitter?

I think he’s the first Twitter president. Yes, I think it marketed him beautifully and got him to his users, it gave him a voice. I think it was genius because the media pays attention, and the media overindexes on Twitter even though it’s a much smaller company than say Facebook or anything else. The media is obsessed with Twitter. I think it’s the perfect storm for him. Yeah, I do.

Yeah, I ... Look, I think for every situation like that ... obviously, that’s not the person I voted for so I have a lot of concerns we’ve talked about endlessly, but ultimately more voices are good, more advocacy is good, more people getting involved.

I went to the Women’s March in DC, I think that was pretty much organized on Twitter, so ...

Facebook and Twitter.

I think you’re going to see things that we’re going to find objectionable, but I think the benefit is so much more ...

Really? I think objectionable people use it better.

Do you?

Yes, I do. I think they’re excellent at it. I think he’s a Twitter genius, I don’t know how else to put it. Everyone always makes fun of him, but I’m like, “That was smart.”

Well, he’s got a black belt in distracting people from the real agenda.

Yes, he does. He does. Does it make you feel bad sometimes? Like, “I was the one who put this fricking business in business?”

No, I don’t feel bad. I think this will work out in the end.

You think?


All right. Last thing, I talk a lot about people’s mistakes that they’ve made and things and tips, and entrepreneurs really do like to hear about what things they should pay attention to or what mistakes you’ve made. Can you talk just a little about a few?

Okay, how much time you got? [laughs]

Yeah, but give me one or two things that you did that you wish you had done differently and something you did really well that you think you made it ... because you clearly have your finger on the pulse of a lot of early stuff. It doesn’t always turn out right necessarily, but it’s also ... it points directions, for sure.

Yeah. Well, look, the thing about VCs that people should be mindful of, especially VCs, is that we’re mostly wrong.

Yes. Oh my God, I can’t believe you admitted that.

The business that we’re in, we’re investing in crazy ideas, some are legitimately crazy, and statistically or whatever, I think good VCs are probably 80 percent wrong, bad VCs are 100 percent wrong. So I think when VCs tend to get too serious about talking from the top of the mountain, that makes my skin crawl a little bit.

I think the mistakes that I mostly feel are a little cringe worthy is when I feel like I’ve figured it all out, because that’s the VC trap. It’s like, “I’ve seen all this stuff before. I’ve got these these two tablets, I’ve got the answer.” That’s the part that you want to progress.

You’re stupid. You’re essentially saying, acknowledge your stupidity.

I think that’s a healthy thing to do.

Yeah. I would be remiss in not asking you this, but women and VCs, this has been a big topic, obviously, Uber and things like that, and people of color and different people, different ages: What’s the problem with VCs? Because a lot of people point to the lack of diversity in VCs as directly related to the lack of diversity in startups and this entire continuum that continues.

Yeah. Look, when we started this place, or even when I was in startups and I talked to other VCs, rolling back the tape a little bit, it was all lily-white dudes. I remember when I got into this business ...

Yeah, you got some color to you.

I got some color and a weird name, and people were like, “Where did you get your MBA? Did you go to Harvard or Stanford?” By the way, I have no MBA.

“What is that name?”

Yeah, it’s like, “What’s your name?” Then now, we’ve got a firm with people like Santo and Nabeel, weird names and weird colors and all that stuff, and so I think we’ve kind of made progress there. But clearly the gender issue is obvious and has to be dealt with.

Our two most recent partners at Spark are women, Megan Quinn and Rachael Horwitz.

Megan is from Kleiner, correct?

Yeah, she was at Stanford, Google, Square, Kleiner, Spark. And Rachael was four years at Twitter and then Facebook and then Spark, and I’m ecstatic that they’re at Spark. Should we have had two women partners earlier than a couple of years ago? Yes! Definitively, yes. What took us so long? That, obviously, in retrospect we should’ve done it a lot earlier.

Well, what did take you so long? What do you think it is? Because then you have people like Mike Moritz and others saying, “Well, if we had women, we’d find them.” I think that’s just a lie, an actual lie that they tell themselves.

I think you’ve just got to be really mindful of this stuff. I’ve heard now plenty of examples where people like get Slack, when they hire, they say, “Hey, we’re hiring diversified candidates only for these roles.” I think you have to be that intentional about things, and I think that’s what this industry needs, is to be intentional.

How does that change?

I think part of it is role models. You see companies like Slack and others really walking the walk, and I think that’s part of it because then employees are drawn to those companies that are more doing the right thing.


Right, and they’re role models, and then other entrepreneurs are like, “Oh, I look up to Stewart, I know what he’s doing over there, I’m going to emulate that here.” I think there’s a lot of ... The impact of role modeling is a big deal.

Last question: Are you hopeful or helpless? Do you feel hopeful or helpless right now?

There are definitely dark days, but on the whole, I’m hopeful.

Yeah. Well, Bannon is off the NSC, you should feel better.

That is a good day.

That’s today. All right, this has been a great talk with Bijan Sabet, who is a venture capitalist at Spark Capital. Thank you so much for coming by.

Thank you.

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