As you start the company, you start spending spending spending ahead of revenue but then you come out of it and very quickly you should become a company that spends less than it makes. And what I mean by very quickly, is that window of time should be in that 6 to 8 year time frame. And the reason is because if you build your business model correctly it's almost unavoidable.
Chamath PalihapitiyaThe half-life of companies is shrinking. So in the same ease in which you can start a company today to disrupt an incumbent, you have to also realize that somebody will do that to you as well just as easily. So if you're not just going to get on top but stay on top, that will require a real prepared mind across many companies.
Chamath PalihapitiyaAs you start the company, you start spending spending spending ahead of revenue but then you come out of it and very quickly you should become a company that spends less than it makes. And what I mean by very quickly, is that window of time should be in that 6 to 8 year time frame. And the reason is because if you build your business model correctly it's almost unavoidable.
Chamath PalihapitiyaIf you're trying to get to profitability by lowering costs as a startup then you are in a very precarious and difficult position. You need to grow through profitability.
Chamath PalihapitiyaI think going public should not be a goal and the more that we make it a goal, the less it will be a goal. It's kind of like, I have three young children and when I tell them to eat vegetables, the last thing they will ever do is eat vegetables. I think it's just this weird thing where entrepreneurs have a reflexive negative reaction when people are pushing for it. I think you have to view going public for what it is, which is a transitional moment where you can consolidate mindshare and win at an even larger scale.
Chamath PalihapitiyaPeople should absolutely have a point of view about the political process themselves individually, but we're also at a point in the evolution of capitalism where any one individual's impacts are over estimated because there is enough regulation and guard rails. They may be odious and grotesque in what they say, but the practical day-to-day impacts from a policy perspective tend to be limited because the system made it so. That's why you see a lot of political apathy because people have internalized the inability for anyone either really really good or really really bad to do anything.
Chamath PalihapitiyaIt's OK, by the way, that it takes 10 years for you to make "money." Since when was it that being in your mid-30s to make a few hundred thousand dollars or a million dollars was like egregiously unfair? I think we have to have a sense of perspective here. We're all going to live into our 80s or 90s. So what is everybody in such a rush for?
Chamath Palihapitiya