MiB: Chamath Palihapitiya on Venture Investing

 

 

This week, we speak with Chamath Palihapitiya, the founder and CEO of Social Capital LP, which backs breakthrough companies in areas such as health care, education, climate change, and space. Prior to founding Social Capital, Palihapitiya was a member of Facebook’s senior executive team and was a software engineer with AOL and Slack. He is also part-owner of the NBA’s Golden State Warriors.

He explains his issues with the institutionalization of the venture model. Instead of focusing on “moonshots,” the trajectory is towards safer, more obvious investments that have compromised the mission of venture investing. This leads to the Risk-Off approach that leads to safe returns, instead of what he describes as the true purpose of venture investing.

Palihapitiya explains how he embraced the path less traveled than what has become to traditional venture route: Eschew limited partners, invest only his own money, use public mechanisms like SPACs to find new merger opportunities — and engage in a massively Risk-On strategy.

A list of his favorite books is here; A transcript of our conversation is available here.

You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here.

Be sure to check out our Masters in Business next week with Soraya Darabi, co-founder and general partner of TMV. The firm has funded a broad cross-section of startups, 65% of which are led by women or people of color. Less than 5 years old, TMV has already had 10 exits.

 

 

 

Chamath Palihapitiya’s favorite books

Narrative of The Life of Frederick Douglass: An American Slave by Frederick Douglass

Americana: A 400-Year History of American Capitalism by Bhu Srinivasan

Fermat’s Enigma: The Epic Quest to Solve the World’s Greatest Mathematical Problem by Simon Singh

Liar’s Poker: Rising Through the Wreckage on Wall Street by Michael Lewis

 

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