On this special segment of The Full Ratchet, the following Investors are featured:
- Sami Inkinen
- Heidi Roizen
- Phin Upham
We asked guests to discuss the factor that could cause the most disruption to the industry going forward and how that will change the next decade of venture.
The host of The Full Ratchet is Nick Moran of New Stack Ventures, a venture capital firm committed to investing in founders outside of the Bay Area.
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Transcribed with AI:
0:19
Welcome back to etfr On today’s special segment, we ask guests to discuss the factor that could cause the most disruption to the industry going forward, and how that will change the next decade of venture here’s the segment called disruptive forces.
0:38
On today’s special segment, we have Sami inkanen of Trulia and verta health. Sami, what factor could cause the most disruption or change to healthcare, and how will that make the next 10 years look different than the last 10?
0:52
I think we can respond to things like new president and new you know, this and that, and we had Affordable Care Act during Brazil and Obama all kinds of things, and Medicare could be expanded and yada yada, ya. All this, I just don’t the complex incumbent systems is sort of networks that change much lower than people think. Now you could have some black swan event. Like, we literally run out of cash, and we need to cut everything by 50% federal spending. There could be black swan events 100% we had covid, but even that now it’s like a speed bump, right? Like, when we were in the middle of it, we’re like, oh, everything’s gonna change, supply chain of drugs and this and that, and we’re gonna be like, whatever, the whole world’s gonna change. Well, did it? Not really. So I’m actually very, I don’t know it’s optimistic or pessimistic, but I don’t think anything’s gonna
1:45
change. What about the employer driven healthcare model does that?
1:49
I don’t think it’s gonna change. It’s not gonna change. No, you, if you ask me, What? What if I could rip the whole thing and we’ll be a better system? You know, there’s a lot of ideas. Again, I grew up in a single basis. I mean, Finland. I’ve seen the benefits of that. I’ve seen the benefits of the US system. And by the way, one benefit of the US system is the following. In Finland, I would have one customer to sell to. It’s called the Finnish government. Guess what? 10 year sales cycle in America, I have 5000 customers to sell to. So I don’t care how crazy your idea is, you can find five crazy customers, initial customers from a 5000 pool. And what, what does that enable? That enables innovation. That enables so we can poopoo, the US healthcare system many ways. And I could poo poo. I there’s so many things to improve, but one thing is better than in Finland, which is that given how fragmented it is, given how many decision makers there are, given how many payers they are, it actually enables innovation better than a single payer system. Fascinating.
3:00
On today’s special segment, we have Heidi Roizen, of threshold ventures. Heidi, what factor could cause the most disruption to the VC industry, and how will that make the next 10 years of VC look different than the last time?
3:12
Well, I mean, I’m sorry, I’m just gonna this is, it’s a cliche, but it happens to be true is, man AI is gonna cause a lot of disruption. It’s gonna cause a lot of disruption about what kinds of companies we invest in. It’s may cause disruption about how our industry itself operates, although, again, we’ve been through many cycles where people thought they could turn early stage venture into a data driven analytics machine, and I’ve yet to see one of those work, but maybe AI will change that. But I think AI is just going to be, it’s, it’s, it’s, it’s going to it’s, it, in a way, is going to change things slowly until it changes things quickly, and it’s,
3:53
do you have a prediction on what the effect will be? I mean, are we, are we looking at billion dollar companies run by a handful of people? Is it I worry
4:00
about that? I mean, I worry about, you know, if you just look at history as our teacher, and when you have these massive technologies that are kind of winner take all markets, and you look at, I mean, I mean, come on, but seven of the top 10 most valuable companies in the world were venture backed tech startups, right? Something like that, it’s at least five, it’s probably 10, it’s probably seven. That’s a lot of concentration of wealth, right? Who are the richest people in the world right now, look at that list, a lot of male tech guys on that list. Yeah, yeah. No offense to male tech guys. But you know, so and if AI has the opportunity to concentrate and dominate even more than the last wave of technology. What is it we’re doing about that? I mean, I for one, think that the whole construct of open AI is a fascinating governance and economic experiment, because the idea that you cap return. And you build wealth for the common good. I think it’s a very interesting concept because, because I think this is the very problem is, like, everybody talks about how, Oh, we’re gonna, we’re gonna AI is gonna do everyone’s jobs, and then we’re gonna be free to do other things, yeah, but the money AI makes by doing those jobs is gonna go to the people who invested in those AI companies, not to everyone. And so how does that work? Like that? That’s not a plan. That’s not a good plan at all. And I say that as one of those people who is making those investments and who expects the benefit from good AI, right? But I see the inherent complication in this is, is you need a completely different economic structure, societally, or you’re going to you’re going to have a giant mess. And unfortunately, I think we’re probably going to have the giant mess before we have sufficient change. And I I am not smart enough to predict what that answer should be, but I do think things like what OpenAI is doing. I think those are the kinds of things that we have to look at. And I do think, in a way, as much as I also hate to say this, because I don’t love giant government and having government in everything. I do think some of this is at the governmental level, because it is going to affect us as a nation at such a significant and severe level that that our government needs to be involved. Well,
6:22
Heidi, I hope you’re wrong. That’s on both fronts. I,
6:27
you know, I don’t trust Well, we won’t get into politics. I don’t want to get into politics right now. I’m just grumpy about politics completely. But I don’t know how. I don’t know. I think that the you know, I’m sorry, but the economic model that we operate under doesn’t tend to solve for the kinds of problems that we’re going to create potentially with the kind of concentration you’re going to see concentration of wealth you’re going to see under AI
7:00
on today’s special segment, we have Finn Upham of haymaker. Finn, what factor could cause the most disruption to the VC industry, and how will that make the next 10 years of VC look different than the last day?
7:12
What factor caused the most disruption to the VC industry? I mean, look, I think that the way that regulate, I think that people don’t fully appreciate the ways that these things trickle down. So like, when you stop mergers or big tech companies, and the ability for big tech companies to acquire other companies, when, when Facebook and Google and and and and, you know, and Apple cannot acquire something, they got a substantive acquisitions, which, by the way, might or might not be the right thing to do, if you’re the government, if you’re Lina Khan, or if you’re a regulator, if they can’t make acquisitions, it really hurts everyone down in VC, because there’s no longer any exits for the late stage. Therefore there’s the valuations go all trickle all the way down, and then the funding dries up. And so I think the two big risks is the Republicans break up big tech or the Democrats regulate it into sort of submission. And I think both of those options are going to be really, really, really bad for VC, because submission regulation, no acquisitions, makes no exits, and breaking up companies while it reduces the potential outcomes of the value. And so you’re underwriting to a lower value. If you have fewer big companies like you can’t underwrite to the potential for a trillion dollar outcome. If no one’s allowed to be big, you can’t underwrite in VC to 100x but then simultaneously, if all the big guys are really big, but they’re not allowed to be profitable, they’re not allowed to compete, then you can’t underwrite to a profitable company. And so which of is Skylar Caribbeans. Like, these are the two bad options. And like, the good option is the one that’s existed so far, which is like mission oriented, less regulated tech companies that provide great services and win on merit and are allowed to win on merit, and that’s not something any politician is saying.
9:02
You that will conclude this installment of investor stories. If you’re enjoying the program and would like to see it continue, take a moment and leave a five star review in iTunes. Okay, that will wrap things up for today until next time over. Prepare, choose carefully and invest confidently. Thanks for joining me.
