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Kevin Rose from Web 2.0 to Web3

Limited Partner Episode

August 29, 2021
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We sit down with the one & only Kevin Rose to talk about his journey from pioneering Web 2.0 with Digg to leading the charge on Web3 and NFT + DeFi investing as a partner at True Ventures and his new show Modern Finance. We cover it all — TechTV, Digg’s true origin story, Milk, Hodinkee, interviewing Beeple and where MoFi goes from here. This was an episode we’ve been wanting to do forever, and Kevin was truly a blast to hang out with. Tune in and then go check out everything he’s building now over at Modern Finance!

If you love Acquired and want more, join our LP Community for access to over 50 LP-only episodes, monthly Zoom calls, and live access for big events like emergency pods and book club discussions with authors. We can't wait to see you there. Join here.


Sponsors:

  • Thanks to SoftBank Latin America for being our presenting sponsor for this special episode. If you are an entrepreneur, employee, other investor or simply someone who's interested in learning about the best young companies in LatAm right now, get in touch with thema, and tell them that Ben and David sent you!
  • You can get in touch Rappi's Sebastian Mejia at sebastian@rappi.com or @mejiasebas on Twitter
  • Thank you as well to Modern Treasury and to Fundrise. (And you can find our reverse interview with Modern Treasury here!)


Links:


Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.

We finally did it. After five years and over 100 episodes, we decided to formalize the answer to Acquired’s most frequently asked question: “what are the best acquisitions of all time?” Here it is: The Acquired Top Ten. You can listen to the full episode (above, which includes honorable mentions), or read our quick blog post below.

Note: we ranked the list by our estimate of absolute dollar return to the acquirer. We could have used ROI multiple or annualized return, but we decided the ultimate yardstick of success should be the absolute dollar amount added to the parent company’s enterprise value. Afterall, you can’t eat IRR! For more on our methodology, please see the notes at the end of this post. And for all our trademark Acquired editorial and discussion tune in to the full episode above!

10. Marvel

Purchase Price: $4.2 billion, 2009

Estimated Current Contribution to Market Cap: $20.5 billion

Absolute Dollar Return: $16.3 billion

Back in 2009, Marvel Studios was recently formed, most of its movie rights were leased out, and the prevailing wisdom was that Marvel was just some old comic book IP company that only nerds cared about. Since then, Marvel Cinematic Universe films have grossed $22.5b in total box office receipts (including the single biggest movie of all-time), for an average of $2.2b annually. Disney earns about two dollars in parks and merchandise revenue for every one dollar earned from films (discussed on our Disney, Plus episode). Therefore we estimate Marvel generates about $6.75b in annual revenue for Disney, or nearly 10% of all the company’s revenue. Not bad for a set of nerdy comic book franchises…

Marvel
Season 1, Episode 26
LP Show
1/5/2016

9. Google Maps (Where2, Keyhole, ZipDash)

Total Purchase Price: $70 million (estimated), 2004

Estimated Current Contribution to Market Cap: $16.9 billion

Absolute Dollar Return: $16.8 billion

Morgan Stanley estimated that Google Maps generated $2.95b in revenue in 2019. Although that’s small compared to Google’s overall revenue of $160b+, it still accounts for over $16b in market cap by our calculations. Ironically the majority of Maps’ usage (and presumably revenue) comes from mobile, which grew out of by far the smallest of the 3 acquisitions, ZipDash. Tiny yet mighty!

Google Maps
Season 5, Episode 3
LP Show
8/28/2019

8. ESPN

Total Purchase Price: $188 million (by ABC), 1984

Estimated Current Contribution to Market Cap: $31.2 billion

Absolute Dollar Return: $31.0 billion

ABC’s 1984 acquisition of ESPN is heavyweight champion and still undisputed G.O.A.T. of media acquisitions.With an estimated $10.3B in 2018 revenue, ESPN’s value has compounded annually within ABC/Disney at >15% for an astounding THIRTY-FIVE YEARS. Single-handedly responsible for one of the greatest business model innovations in history with the advent of cable carriage fees, ESPN proves Albert Einstein’s famous statement that “Compound interest is the eighth wonder of the world.”

ESPN
Season 4, Episode 1
LP Show
1/28/2019

7. PayPal

Total Purchase Price: $1.5 billion, 2002

Value Realized at Spinoff: $47.1 billion

Absolute Dollar Return: $45.6 billion

Who would have thought facilitating payments for Beanie Baby trades could be so lucrative? The only acquisition on our list whose value we can precisely measure, eBay spun off PayPal into a stand-alone public company in July 2015. Its value at the time? A cool 31x what eBay paid in 2002.

PayPal
Season 1, Episode 11
LP Show
5/8/2016

6. Booking.com

Total Purchase Price: $135 million, 2005

Estimated Current Contribution to Market Cap: $49.9 billion

Absolute Dollar Return: $49.8 billion

Remember the Priceline Negotiator? Boy did he get himself a screaming deal on this one. This purchase might have ranked even higher if Booking Holdings’ stock (Priceline even renamed the whole company after this acquisition!) weren’t down ~20% due to COVID-19 fears when we did the analysis. We also took a conservative approach, using only the (massive) $10.8b in annual revenue from the company’s “Agency Revenues” segment as Booking.com’s contribution — there is likely more revenue in other segments that’s also attributable to Booking.com, though we can’t be sure how much.

Booking.com (with Jetsetter & Room 77 CEO Drew Patterson)
Season 1, Episode 41
LP Show
6/25/2017

5. NeXT

Total Purchase Price: $429 million, 1997

Estimated Current Contribution to Market Cap: $63.0 billion

Absolute Dollar Return: $62.6 billion

How do you put a value on Steve Jobs? Turns out we didn’t have to! NeXTSTEP, NeXT’s operating system, underpins all of Apple’s modern operating systems today: MacOS, iOS, WatchOS, and beyond. Literally every dollar of Apple’s $260b in annual revenue comes from NeXT roots, and from Steve wiping the product slate clean upon his return. With the acquisition being necessary but not sufficient to create Apple’s $1.4 trillion market cap today, we conservatively attributed 5% of Apple to this purchase.

NeXT
Season 1, Episode 23
LP Show
10/23/2016

4. Android

Total Purchase Price: $50 million, 2005

Estimated Current Contribution to Market Cap: $72 billion

Absolute Dollar Return: $72 billion

Speaking of operating system acquisitions, NeXT was great, but on a pure value basis Android beats it. We took Google Play Store revenues (where Google’s 30% cut is worth about $7.7b) and added the dollar amount we estimate Google saves in Traffic Acquisition Costs by owning default search on Android ($4.8b), to reach an estimated annual revenue contribution to Google of $12.5b from the diminutive robot OS. Android also takes the award for largest ROI multiple: >1400x. Yep, you can’t eat IRR, but that’s a figure VCs only dream of.

Android
Season 1, Episode 20
LP Show
9/16/2016

3. YouTube

Total Purchase Price: $1.65 billion, 2006

Estimated Current Contribution to Market Cap: $86.2 billion

Absolute Dollar Return: $84.5 billion

We admit it, we screwed up on our first episode covering YouTube: there’s no way this deal was a “C”.  With Google recently reporting YouTube revenues for the first time ($15b — almost 10% of Google’s revenue!), it’s clear this acquisition was a juggernaut. It’s past-time for an Acquired revisit.

That said, while YouTube as the world’s second-highest-traffic search engine (second-only to their parent company!) grosses $15b, much of that revenue (over 50%?) gets paid out to creators, and YouTube’s hosting and bandwidth costs are significant. But we’ll leave the debate over the division’s profitability to the podcast.

YouTube
Season 1, Episode 7
LP Show
2/3/2016

2. DoubleClick

Total Purchase Price: $3.1 billion, 2007

Estimated Current Contribution to Market Cap: $126.4 billion

Absolute Dollar Return: $123.3 billion

A dark horse rides into second place! The only acquisition on this list not-yet covered on Acquired (to be remedied very soon), this deal was far, far more important than most people realize. Effectively extending Google’s advertising reach from just its own properties to the entire internet, DoubleClick and its associated products generated over $20b in revenue within Google last year. Given what we now know about the nature of competition in internet advertising services, it’s unlikely governments and antitrust authorities would allow another deal like this again, much like #1 on our list...

1. Instagram

Purchase Price: $1 billion, 2012

Estimated Current Contribution to Market Cap: $153 billion

Absolute Dollar Return: $152 billion

Source: SportsNation

When it comes to G.O.A.T. status, if ESPN is M&A’s Lebron, Insta is its MJ. No offense to ESPN/Lebron, but we’ll probably never see another acquisition that’s so unquestionably dominant across every dimension of the M&A game as Facebook’s 2012 purchase of Instagram. Reported by Bloomberg to be doing $20B of revenue annually now within Facebook (up from ~$0 just eight years ago), Instagram takes the Acquired crown by a mile. And unlike YouTube, Facebook keeps nearly all of that $20b for itself! At risk of stretching the MJ analogy too far, given the circumstances at the time of the deal — Facebook’s “missing” of mobile and existential questions surrounding its ill-fated IPO — buying Instagram was Facebook’s equivalent of Jordan’s Game 6. Whether this deal was ultimately good or bad for the world at-large is another question, but there’s no doubt Instagram goes down in history as the greatest acquisition of all-time.

Instagram
Season 1, Episode 2
LP Show
10/31/2015

The Acquired Top Ten data, in full.

Methodology and Notes:

  • In order to count for our list, acquisitions must be at least a majority stake in the target company (otherwise it’s just an investment). Naspers’ investment in Tencent and Softbank/Yahoo’s investment in Alibaba are disqualified for this reason.
  • We considered all historical acquisitions — not just technology companies — but may have overlooked some in areas that we know less well. If you have any examples you think we missed ping us on Slack or email at: acquiredfm@gmail.com
  • We used revenue multiples to estimate the current value of the acquired company, multiplying its current estimated revenue by the market cap-to-revenue multiple of the parent company’s stock. We recognize this analysis is flawed (cashflow/profit multiples are better, at least for mature companies), but given the opacity of most companies’ business unit reporting, this was the only way to apply a consistent and straightforward approach to each deal.
  • All underlying assumptions are based on public financial disclosures unless stated otherwise. If we made an assumption not disclosed by the parent company, we linked to the source of the reported assumption.
  • This ranking represents a point in time in history, March 2, 2020. It is obviously subject to change going forward from both future and past acquisition performance, as well as fluctuating stock prices.
  • We have five honorable mentions that didn’t make our Top Ten list. Tune into the full episode to hear them!

Sponsor:

  • Thanks to Silicon Valley Bank for being our banner sponsor for Acquired Season 6. You can learn more about SVB here: https://www.svb.com/next
  • Thank you as well to Wilson Sonsini - You can learn more about WSGR at: https://www.wsgr.com/

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Transcript: (disclaimer: may contain unintentionally confusing, inaccurate and/or amusing transcription errors)

David: Welcome to Acquired. Today we're sitting down with Kevin Rose. Kevin was one of the pioneers of Web 2.0 as the founder of Digg and then became one of the Valley's first super angels investing early in companies like Twitter, Facebook, and Square. Today, he's a partner at True Ventures and host of the Modern Finance podcast. Let's chat with him.

Ben: Welcome to this special episode of Acquired, the podcast about great technology companies and the stories and playbooks behind them. I'm Ben Gilbert and I'm the co-founder and managing director of Seattle-based Pioneer Square Labs and our venture fund, PSL Ventures.

David: And I'm David Rosenthal. I am an Angel investor based in San Francisco.

Ben: We are your hosts. This was so effing cool.

David: Kevin is so great. We had such a blast. Of course, we went to cover The Screen Savers, the real origin story of Digg, the Diggnation parties at South by that Ben you were at back in the day.

Ben: Totally. He corrected the record. All the previous Digg founding stories are wrong.

David: No, Wikipedia is wrong, apparently.

Ben: Listeners, this episode basically has two chapters. We start in Web 2.0 and we end in Web 3.0. Obviously, Kevin is super deep on all things crypto, blockchain, and NFTs. He's doing a really cool thing on the Modern Finance podcast. He even ends the show by announcing a new thing that he's doing. Stay tuned for that. I had so much fun in this episode pattern matching everything Kevin learned from Web 2.0 to the Web 3.0 world.

All right, our presenting sponsor for this episode and all of our special episodes for the rest of 2021 is the SoftBank Latin America Fund. We started last time by having Shu and Paulo on, who are the managing directors of the fund. We decided it would be fun to go around the portfolio and hear from the founders themselves about the unbelievable companies that they are building in the LatAm region. Today we are joined by Sebastian Mejia, who is the co-founder and president of SoftBank Portfolio Company and Latin America mega unicorn, Rappi.

David: Sebastian, welcome to Acquired. We're so excited to have you here and hear a little bit more about Rappi. I think most people listening will know of you all and probably think of you as the largest food delivery platform in Latin America. But really, the better analogy here is Meituan and becoming a super app. Can you tell us a little bit about how Rappi works today and what you're building?

Sebastian: It's a common misconception that Rappi is just building analog of some US companies that do food delivery or that do grocery delivery. In reality, what we build is a product that allows customers to solve their day-to-day life. Rappi initially started as a product that was focused on convenience. By listening to customers, Rappi started going into other verticals in ecommerce like food delivery, pharmacy, and large supermarket orders.

Now we are building a product that is also financial services in the form of a credit card and a product that also allows customers to have anything delivered in 10 minutes. That's not just by peeking in stores, but actually verticalized in the business and operating micro fulfillment centers. Think of Rappi as this great product that basically allows you to solve their lives day-to-day.

Ben: Our understanding is that this is uniquely possible in the Latin America market. Why is that?

Sebastian: If you look at the history and the evolution of ecommerce, we haven't had that much transformational innovations. When we started building the company, we went really deep to answer those questions and understand why that was happening. We realize that if you really want to build a foundational ecommerce business, you have to go deep, you have to build logistics, you have to tackle payments, and you have to be fully mobile.

What we learned is that when you're coming from a pretty much offline world and you come to customers with a solution that is so much better than their offline experience, you have this opportunity to leapfrog, but it only happens if you actually go deep and tackle those barriers. If you think of the US, for example, there are just so many more options. There are companies that can basically build large businesses by being just a specific category in ecommerce.

The fact that Latin America is still so unbundled allows you to actually be the company that bundles and offers all of these categories and all of these products, then you start banking, then you start using our credit card, and then you just stay in the ecosystem. I think that's very unique to the emerging world and very unique to Latin America.

Ben: That's awesome. If people want to get in touch, maybe to work at Rappi, if they're interested in investing in the company, or perhaps being a customer if they're in a country where that's possible here in 2021, how can they get in touch?

Sebastian: So easy, sebastian@rappi.com and @mejiasebas at Twitter.

Ben: Great. Listeners, if you want to get in touch with either Rappi or our friends Paulo and Shu at the SoftBank LatAm Fund, we have put links in the show notes. Obviously, SoftBank is sponsoring this episode. But hearing Sebastian, at least for me, it's clear there is so much opportunity there.

If you're an entrepreneur, thinking about doing business there, want to explore working there as an employee, or you're another investor looking to deploy capital in the region, you should definitely get in touch with Paulo and Shu and help be a part of Rappi or frankly the next Rappi. Just tell them that Ben and David from Acquired sent you.

All right, two last things. One, as usual, this is not investment advice from either us or Kevin. Do your own research. Come to your own conclusions on making your own investments. This is for entertainment and informational purposes only. As usual, two, join us in the Acquired Slack, acquired.fm/slack. We are nearing the 10,000-person mark. It is a great group. We'd love to have you.

Now on to our conversation with the one and only Kevin Rose. Kevin Rose, so great to be talking with you.

Kevin: Yeah, thanks for having me on the show. It's going to be fun.

Ben: I think many, many episodes of my teenage years watching Diggnation later, I feel probably the same way a lot of our listeners do when they run into David and I and are like, oh my God, you're like a real human. I feel very, very similarly talking to you today. Thank you for all the just massive indulgence of nerdery over the years.

Kevin: Yeah, there is a bunch of nerd stuff there, a little comedy. Hopefully I didn't convince you to start drinking at a young age because we were of legal age, but we did consume beers on each episode.

David: I was lucky. I actually started watching you on Screen Savers when there was no alcohol involved. It's like when I was a middle school tech, TechTV. We're going to get into it.

Ben: Let's start—because this is Acquired—way back. Kevin, I think we have it right. You grew up in Vegas, but your family is from Wisconsin, which is a state we've talked about recently with Marc Andreessen growing up there and Beeple on your show. What was that like?

Kevin: My earliest memories, I was born in Redding, California, but I don't remember it. Then I remember living in Oregon for a bit, which is where I am now, in Portland. But we were living in a little town called Salem. Then when I was in second grade, we moved out to Las Vegas because there was just work there. That was a place where my dad could find a job.

We moved out there. I grew up thinking it was normal for 7-Elevens to have slot machines in them. There were just a lot of things that Vegas does to you. It was one of those things where I got geeky, got into computers, and then quickly realized that the action really wasn't in Las Vegas. If you want to be in the hotel industry or work in gaming in some capacity, that was the place to be. But when I was around 18 or so, I realized, well, I should probably think about moving someplace else like Silicon Valley or someplace that had a bigger tech scene.

David: I'm super curious. How did you figure that out? I felt the same way. I grew up in Pennsylvania, but I had no idea that Silicon Valley existed. What was the process by which you learned that this was a thing? Because there's the internet, but it wasn't obvious in the way it is now.

Kevin: Yeah. Basically, when you started to get into computers back then, you're right. There wasn't like the internet where you could just go and figure all this stuff out. I was on bulletin board systems and dial-up. I remember going into computer stores and buying computer magazines because that's what we did. To stay up with all the latest trends, you would just buy a magazine that was about computers, take it home, and read about motherboards.

I just basically would hear about these conferences and there was one called COMDEX, which was the world's largest computer convention. It was held in Las Vegas. I was like, oh, I got to go to this COMDEX thing.

David: You're in high school at this point?

Kevin: Yeah, I was in early high school. I filled out a COMDEX application to go because it was free. The passes were free, but you had to have a business. So I just made up a fake business name. I called it Foliage Software. Then I would apply and I received a badge in the mail. I was like, okay, I'm going. I talked my parents into driving me down to the convention center.

This was before CES. CES was very much, much smaller back then. I would go and just walk the aisles and look at all the different processors, motherboards, video cards, and all the crazy—every big manufacturer had a block of display there that you could go and walk up and try out all the new products. It was the coolest thing ever.

David: This was stuff that hadn't hit the market yet, right?

Kevin: Hadn't hit the market yet. It was brand new. That's how I realized that all these companies were not based here. Most of them were California, Silicon Valley-based. I was the youngest kid on the floor. I had to dress up. I put a collared shirt on. Then it was funny because they noticed a couple of kids started coming. You had to be at least 16 to get in.

The next year, I think I was 15 and I was like, oh, how am I going to prove that I'm 16? I think if someone asked me, I just told him I was 16. I had to have my birthdate memorized a year earlier. Then the next year, they made it so you had to be 18 to get in and I was like, crap. It kept moving the gold line.

David: You did a fake ID?

Kevin: Yeah, exactly. A fake ID to get into a computer convention. Anyway, that was the early days.

David: Oh my gosh. All these Silicon companies that were exhibiting at COMDEX. Yeah, they're all based out in Silicon Valley. It was really Silicon Valley, but they weren't building fabs anymore, and so they could just move at such a faster pace. I remember this. It was like, all these new products—all these chips, all these PCI plugins for motherboards. They're all hitting the market so fast. That was awesome.

Kevin: It was so exciting when you hear about a new clock speed come out. Intel would announce something and you're like, wow, a 66 megahertz processor, or AMD would have their new chip. Then you have the weird folks that were all like the DEC Alphas, a completely different RISC- versus CISC-based processors that weren't compatible with Windows. You're like, whoa, wait a second. What's this Unix thing? It was a crazy time.

David: Before we move on from Vegas, obviously, you were a dyed-in-the-wool computer geek. Sneaking into COMDEX, that's amazing. Was there anything presaging your soon-to-be future career in front of the camera? Did you do drama in high school?

Kevin: No. I think I was the most shy kid growing up and just didn't have a ton of friends in high school. I don't even know if this holds true today, but back then, it was not cool to be into computers. You got made fun of a lot and didn't have a lot of friends. We were definitely not the popular kids in school and got picked on.

I didn't apply to work at TechTV to be in front of the camera. I just wanted to be behind the scenes. I was setting up all the technical demos and if they needed a certain version of Linux installed, I would install that, and just make sure that things were moving smoothly in that regard. It was just by chance that I ended up on camera.

Ben: Do you remember your break? The moment where someone was like, hey, Kevin, you should be on-air talent?

Kevin: Yeah. I had discovered a vulnerability in Windows that was a way to spam people using this kind of internal messaging tool. You could basically just send a message to any IP address and Windows would display it on the screen. While it wasn't necessarily a vulnerability in the sense of the person wasn't getting hacked, it was definitely a way to spam people. You could just write a little utility that would just go through IP addresses and deliver little notifications to their desktop. I told the host about it and they're like, well, you figured this out. You should come on and talk about it.

David: Were Leo Laporte and Patrick Norton hosting at this point?

Kevin: Exactly. Leo Laporte had me next to him and I was so nervous. I was just sweating. I went on and I delivered it and explained it. The executive producer, Paul Block was like, hey, I like what you did there, can you find more weird things to talk about that are not really known? I was thinking like, well, I know a lot of these hacking tools and stuff that I mess around with at night. We could talk more about those types of things. He was like, yeah, do more of that and let's see how you do. Let's have you come on once a week and talk about a certain tool.

I look back and cringe at some of that stuff because you could just hear in my voice and the way I presented, especially in the earlier episodes, it wasn't in my DNA to be on camera. Actually, they sent me to a talent coach that would come in, record you, playback footage with you, make you watch yourself, and talk about how you hold your hands. There are these dedicated coaches that will teach you everything.

Ben: I did that once. I was at Microsoft and I was going to go speak on behalf of the company to a newspaper, and they had me speak with a coach first and she videotaped. I think it was like 5K for two hours. It was this exorbitant corporate markup. She videotaped me for some of my talking points and then made me watch it back while we were sitting there at the table. It was the most painful experience.

Kevin: It helps a ton, though. It's a good strategy for sure.

Ben: Totally.

David: You were the Dark Tipper on the show, right?

Kevin: That was the horrible nickname they gave me on the show.

David: Was that from that first episode? Did Leo just ref that? Where did that come from?

Kevin: We used to have these things called Windows Tips. It was like a quick check-in. When you're doing a segment, everything on TV is broken into blocks. They'll have the A block, which is the very beginning of the show and they break it down into individual segments. There's a person keeping a timer on—when you're doing live TV—making sure the blocks don't go too long because it impacts other people's segments. It's a very tight, well-oiled machine that has to run perfectly to pull off a live show.

They had these little kickers that they would do. When you finish a block, you bump out to a Windows Tip or a little 30-second, 45-second, 1-minute long max little tip. They're like, okay, well, Kevin's going to do tips that are about the dark side of the internet, let's call them Dark Tips. Then they called me the Dark Tipper as a joke and then it just was a funny little thing on the show.

David: That's so great. The Screen Savers was live in front of a studio audience, right?

Kevin: Yeah.

David: Were they changing over the set while you were doing this on the main segment?

Kevin: The cool thing is basically, because of the number of cameras they had and the locations on the set, you didn't have to do a lot of changing because there were always two locations to shoot. You would have one off to the side, one primary front location, and then even one of all were in the nook where we took live calls. There wasn't a lot of quick set change unless it was like a guest interview, and that was typically done between commercial breaks.

We would go off to a commercial, you have three minutes and change. Then they'd swap out, roll away the main center console, then put in a couple of chairs, get the guests seated, all the mics checked, and all that good stuff. It's a crazy thing because weird stuff breaks. A guest microphone goes out and somebody is running in 30 seconds before you come back on TV swapping out mics, demos break, and computers reboot randomly. Weird stuff would happen and you just have to roll with it. That's the fun dynamic of live television.

Ben: David, we're so spoiled with Acquired, like infinite retakes, just audio.

David: I was literally thinking, I'm kind of jealous. That must have been such a good trail. This explains why you're so good because you had to just roll with it. We've been doing this for six years, but we have so many luxuries.

Kevin: There's something nice about just being able to say, okay, screw it. If I mess up, so be it and we're done, then you're done. You know what I mean? In my podcast and stuff that I do now, it's like, I'm always going back. I'll listen to an episode that I think is really important. I want to make sure the editor got it right. You're like, listen to it again and you're like, okay, we can trim a little bit here. You just walked out of the studio and you're like, okay, we're done for the day, on to the next day. There was nothing you could do when it went out.

Ben: You really can obsess for a week. Until it is out there and even after you get any feedback that it was actually good, you're like, I just really something awful. I have this pit and a feeling in my stomach. I wish I had spent more time editing, even though I'm sure I just spent way too much cognitive load on this.

Kevin: You never know with your guest. You'll have a guest and you're like, okay, this is a very important person to have on the show for X, Y, or Z. Then you get them on and you're like, so tell me about your background and they're like, it was great. Then they just stop talking and you're like, oh, come on. I got to pull more out of you. This has to be entertaining. It can be challenging as someone doing the interviews to get people to actually open up.

Ben: Totally. Because we're having that enormous problem here, I'm going to pry even deeper. You did not move to the Bay Area to work at TechTV. Was your first job digital marketing for an online furniture retailer?

Kevin: That's right. Basically, there was a company called Next Office that had hired me to come out and just really track all of their ad campaigns and ad spend. They had a marketing team that was going out and buying banner advertisements. People will click on those and eventually lead all the way down to checkout. They wanted to know what the conversion rate was like and where they should be spending their money.

It wasn't ideal for me, but I knew at that point, I'm like, I'll take any job that gets me to the Bay Area. What can I do to get me out there? Because it was the.com boom. I was reading about it in magazines and it was of crazy Web 1.0, just insane valuations, parties, and just all the madness that you saw, IPOs. I was like, I got to get out there. I got to get out there.

I went online and I posted something on monster.com, like the jobs board. Mike Maser, who later became really good friends, reached out to me and was like, hey, I think you'd be great for this role. We had a phone interview, then they flew me out, gave me a job offer, and I took it.

Ben: Super cool.

David: Do you recall how many years you were on Screen Savers before the whole G4 seemingly debacle from the outside?

Kevin: Yeah, it wasn't that long actually because I think it was 2 ½ years that I was at TechTV, which at that time, it was the longest job I've ever had. It was just so awesome.

David: It seemed like it was a special place.

Kevin: A really special place. The majority of people who were in their 20s were around the set and hanging out. We would all just party with each other afterward and go out. We were all really close. We were just like a family. Still, even today, when I see those people, it felt like a very special time in our lives.

We just had no idea what we were doing, but also, we knew what we wanted to create. It was a very creative group of people. The content was good. Leo was a great anchor host. He's a little bit older than us, but brought everything together, and had a great executive producer that was hilarious and fun to work for. It was awesome. But the problem with TechTV is that we weren't, as a network, really making that much money.

David: It was indie, right? It was owned by Paul Allen.

Kevin: That's right. Paul Allen owned it, he was pouring a lot of money into it to keep it alive, and it was an expensive network to operate. We had hundreds of people. Eventually they said, okay, I can't keep spending more money here. We need to actually do something and be acquired. So G4 based out of LA came along and said, we're a video game network, we think this is the future. We're going to acquire TechTV more or less for the subs.

They bought TechTV. They also thought it was a very similar audience. They didn't want to lose that because we had a couple of shows—Screen Savers being one of them—that were getting decent ratings. They're like, okay, how can we bring that audience along, merge it with our video game content? That's what happened.

They bought us and they said, okay, by the way, we're going to shut down San Francisco. We're moving folks to LA. They gave me an offer to come down and continue to host the showdown in Los Angeles. That's what I did.

David: In retrospect, it seems so obviously silly. Even now, at that point, the Bay Area was the center of everything that you guys were doing with Screen Savers to move it down to LA. Because G4 was owned by Comcast, right?

Kevin: That's right.

David: Yeah, not to mention just the culture clash. That must have been rough.

Kevin: It was really rough. They knew long-term that they wanted to morph The Screen Savers into another show. They weren't going to tell us that, but they knew that was the plan. When I saw that was happening, that's not what I wanted to be long-term. I didn't want to be an on-air TV person.

For me, the writing was on the wall that I needed to go do something else and hopefully get back to the Bay Area. Right around when we created Digg and then also I created a podcast network called Revision3. That was about creating more of that type of content, more geeky style content in podcast format.

Ben: Does Revision3 predate the term podcast?

Kevin: Yes, because we were doing video only and there was no way to do a feed of that. Steve Jobs had announced that there was something called a podcast that they were going to support and build that into iTunes. That's when Alex and I said, okay, let's get together and do a show called Diggnation because now we have a place to distribute it.

Ben: At the risk of being way too far down the rabbit hole of internet nostalgia, I seem to remember an opening jingle from Leo's shows that was like, Netcast, you love from people you trust.

Kevin: That's right.

Ben: Funny thinking that, Netcast almost became the thing.

Kevin: Yeah, he didn't want to use the word podcast and I'm not sure why that was. I think that he wanted to brand it his own thing. I don't think he had quite the momentum. It was Adam Curry that coined the term podcast. I think that Leo was thinking at the time (and I believe this is accurate) that he was thinking that it shouldn't be just about Apple and about the iPod because that's what podcast referenced.

Because Leo was a big open-source advocate and things like that. It's so Leo. How can we make this more broadly applicable? Which makes sense, but once the snowball of the term podcast grabbed hold, there was no going back.

Ben: It's like, here I own zero iPods and listen to my podcasts on Spotify who's actively suing Apple. It stuck pretty hard.

Kevin: Yeah, totally. I always thought a lot of those terms were just hilarious. The iPod, like I, when you used to put I in front of things, it meant the internet. I was used to saying these things out loud just to hear how ridiculous they were. Sometimes I still tell people to send me electronic mail because that's what E stood for in anything. It's so funny when you actually pronounce them out loud.

Ben: It's amazing how long these things stick. All right. Thesis with Revision3 though, there's a very clear and loud part of Twitter today talking about the creator economy and beating the drum that this is the next emergent thing. David and I feel like we've experienced it firsthand. You've been experiencing it through multiple generations of the web. Did you have a thesis in starting about the web on the internet as this new direct way to reach consumers?

Kevin: Yeah, absolutely. When we started Revision3, the thinking there was that video was working online. It was starting to take off and people could consume and watch video content. It was easy to produce on our side. We could have some kind of mid-range cameras and gear, an editor that we would just pay part-time. We could churn that out. If we got enough people interested and excited, there would be brands that wanted to sponsor it. That ended up being true.

We had an ad sales team. We had a network of shows. Revision3 grew pretty quickly because people were starting to tune in. We found that niche audiences were quite large. When they would talk to each other and use the internet to share that this type of content was out there, we didn't have to rely upon these distribution agreements of these big old school television networks to get viewership. We could actually measure it in a much more accurate way.

That's what started Revision3. That went on for many years and actually had a great outcome. It was sold to Discovery Networks for $35 million. Even though that sounds small these days, at the time it was a big deal. It became Discovery Network’s digital arm. Basically, it was all about traditional media. For them to get into digital, it's given them a handful of folks that could come and lead that effort on the digital side. It was pretty cool.

Ben: That's great. At what point did you realize the flywheel effect of having a media stream with Diggnation and other ways that you're reaching people and being the founder of Digg, like having this Web 2.0 property?

Kevin: It's a good question. When we started Diggnation, we thought of it as a way to—because we had a base of people that really loved the dynamic that Alex and I had back when we were hosting the television show together. When we started this, we were like, okay, here's a great way for us to talk about the stuff we would normally be talking about, which is the geeky news and our favorite stories. I also happen to have the website, Digg. So it's a great way to surface the best stuff for us to be chatting about.

It became this way to engage the community and highlight their names. I had a top leaderboard back then on Digg. As silly as it sounds, people love seeing their name in lights. Like, oh, Kevin and Alex mentioned me on the show. They mentioned one of the stories that I submitted. It just led to more usage of the website. There was this little flywheel that happened.

Eventually, at some point, Digg became much bigger than Diggnation. It was clear that there were so many people watching, reading, and consuming Digg. Diggnation still had a pretty niche following of the hardcore original people. But that was totally fine with us. We were just having fun on the show.

Ben: Digg was reaching, I think, what did it cap out? Like 38 million monthly uniques?

Kevin: That's right.

Ben: Wild. At that point, that was an enormous audience to be reaching on the web.

Kevin: Yeah, it was pretty big. It was a top 10 web property. It's still pretty big. I would love to have another site that does 38 million monthly uniques.

Ben: I guess when I say at that time because Facebook now reaches three billion monthly active users, I think, if I have it right, you were out ahead of Facebook. Facebook hadn't really started becoming the juggernaut that it is until the late 2000s. I think that was started in 2004. But at one point, didn't Mark come to visit you when you rolled out the Digg button that was letting you upvote articles on their websites when they were thinking about the like button that is now famous everywhere?

Kevin: Yeah, that's right. We had a common investor, Greylock. David Sze—who was a Greylock, who was on our board, and also on the board of Facebook—was like, hey, you guys should get together and did an email introduction. He's like, there's this company Facebook. It's really taking off. You guys should chat. David had already taken off and gotten a ton of press.

Mark hit me up and he's like, hey, let's. I’ll come to the city because he was down in Palo Alto. He's like, I’ll come to SF and love to see your offices. Let's go grab some food. He came to the office and we chatted about just what voting meant. For us, voting on content was helping us service the best stuff, and it was feeding back into our algorithm that would eventually recommend similar content to people. We had this suggested stories portion.

It was early AI, machine learning type stuff that we were applying to articles of, if you like this, you might also enjoy these articles. Mark was really interested in that. This is before they had the like button.

Ben: Pre-newsfeed, I think even pre-mini-feed.

Kevin: Yeah, I don't remember what was going on at Facebook. It was locked down to just colleges, then they started opening it up, and that's when I got an account. But yeah, he was very curious and it was nice. Mark was a nice guy. We ended up hanging out a handful of times and doing a handful of dinners. He was always just very thoughtful.

Even once Facebook took off, it was clear that they were going to be much larger than Digg, he was always really helpful. He just said, if you ever need anything, shoot me a text. Happy to collaborate in different things. He invited us into the early Facebook platform stuff. We were like an early partner there when they first launched their platform. I have nothing but good things to say about how we got to know each other.

David: There's one question I got to ask. We've seen it, it's been reported, but I don't think I've ever heard you talk about it. Supposedly, the story goes (according to the media), you were inspired to start Digg to make the leap and actually start this after you had lunch with somebody. Is that true?

Kevin: Are you talking about CmdrTaco?

David: No. The story I heard was, you had lunch with Woz.

Kevin: No, it was not Woz?

David: No? Interesting. This is from the Business Week story. We read the story that was the famous cover. They reported there that you were inspired to start Digg because you had lunch with Woz and you were like, I'm going to go be an entrepreneur.

Kevin: That's so funny. Sarah Lacey wrote that story, that's funny. This is the problem, and this is so true with so many of my friends’ startups. Success has a thousand founders like they say, or they used to say a thousand fathers or whatever it was, but that's not PC.

There were so many different lore stories. Even Wikipedia is completely wrong. When I look at Wikipedia and the founding stuff there, it's completely wrong. It's just amazing. Do you want me to cover the quick little...?

Ben: Actually, yeah. Let's do it.

David: Let's do it.

Ben: What is the non-apocryphal, as you remember it, even if it's like a bland, the real what happened?

Kevin: This is the truth. This is exactly how it went down. I don't know if I've ever told the full thing, but I'll just do the quick version of it. Basically, what happened is there was a site out there called Delicious that was created by Joshua Schachter that was all about social bookmarking. He would bookmark things and he would count the number of bookmarks on things.

This was one of the very first Web 2.0 properties. It would surface interesting bookmarks. But it wasn't news because people didn't typically bookmark news. They would bookmark things that they wanted to return to later. I would see that and I was like, wow, it's surfacing cool stuff here. I wonder what this would look like if you applied it to everything. That was one piece of it.

The other piece of it was that I did have lunch, but it was with CmdrTaco who's the founder of Slashdot. He came and he was a guest on the show. When I had lunch with him...

Ben: And this was on The Screen Savers?

Kevin: Yes, but it was down in LA.

Ben: Okay.

Kevin: I had lunch with him. This is early or mid-2004. I asked him, where did all those user submissions go? Because Slashdot is great. It promotes their favorite stories to the front page and they're all user-submitted content, but you can't see any of it. I was like, gosh, there has to be just so many good submitted stories here that they're just not surfacing.

I literally told him, I was like, why don't you make it so we can see all the submissions and then we can vote up the best ones? He's like, no, I don't want to do that, blah, blah. It's not the way it works. I was like, okay, well, I'm going to go build this.

Ben: This is like when Vitalik proposed the idea for a distributed world computer to—David, who?

David: It was the Colored Coins and Mastercoin, the Israel Bitcoin 2.0 projects. He was like, yo, guys, we should just do this all as one master thing.

Ben: And they're like, no, we're not going to do that. He's like, okay, cool. I'm going to go start something new.

Kevin: Yeah, that was basically what had happened here with Slashdot. I said, well, I'm just going to go start something new then. Then I went out and I basically just sketched it out. I sketched out what it would look like, what a Digg button would feel like, what an upcoming section would be, where submissions would go—the whole thing. I found a freelance developer. I hired that freelance developer to create the first prototype. His name was Owen.

It says on the website, he was a co-founder. That's not true. He was a freelance developer, but he's the closest thing I had to a co-founder because we were in this together and he built it. It also says that Jay Adelson was a co-founder. That is not true. I hired Jay to be the CEO four or five months later. It also says that Ron is the co-founder. Ron was my first technical backend hire a few months later.

I'm not claiming these guys claim that, I'm just saying this is the way it was written. I don't have any ill will against any of these people. But when people see the first few people are, they call them all co-founders, and all this thing gets written about who did this and that. I'm just like, whatever. It's fine with me. I don't care that Wikipedia never gets corrected, but that is the origin story.

David: Oh my God. That's so great. It gets so twisted because in the lore out there, having a guest on the show, on The Screen Savers, and then that leading to part of Digg is out there. But it says that you had Jay on the show and then you brought him in, but it sounds like no, that was CmdrTaco.

Kevin: No. Jay was on The Screen Savers. I met Jay through going out. He was one of the co-founders of a company called Equinix, which is a big data center company.

David: Yeah, huge.

Kevin: Yeah, huge. I went out and met him through that. He really wanted to do Revision3. He was the first check in the Revision3 to create that content. It was awesome that Jay supported us back in the day, but he told me to get rid of Digg. He thought it was a distraction to Revision3 and he was like, oh, you should sell it. Dude, just focus on Revision3. This is our thing. I put money into this, we need to focus on this. I was like, Jay, you don't understand. Digg is going to be big, it's growing. We can do both.

Eventually, about three or four months later, Jay was like, oh, I see. Yeah, it is growing quite a bit, and I was like, hey, how about I give you some equity? Would you come on and run this? I don't know anything about raising from venture capitalists. I've never done it before. You've clearly been down this path. You've taken a company public. You can help out here.

I give him some equity, a few percentage points of the company. He then built out the right legal folks to work with and brought them on board. I had formed the company using one of these—there was no Rocket Lawyer at the time, but it was like a Rocket Lawyer-esque type thing. The docs were all done wrong.

I didn't have any board meetings or meeting notes. It was all jacked up. We had to have the docs all redone. Jay was very good at helping correct a lot of the mistakes that I had made early on. But he didn't actually come on until six or seven months later after there was some real momentum there.

Ben: There's a thing that I've referenced and you've referenced here, which is Web 2.0. What did that mean to you at the time?

Kevin: I didn't know. I didn't even know what it was called. Jason Calacanis came up to me, who had run Weblogs, Inc., which was Engadget and a bunch of the other sites. He tried to buy Digg very early on. He saw that it was driving traffic to his sites. He sat down with me at Sushi in LA. This was after Digg started to have—it was very small and he's like, I'll give you a million dollars for this.

Ben: Which was a classic lowball.

David: So J. Cal.

Kevin: Honestly, I was like, okay. I came from nothing, man. My parents had $0, as did I. I was like, yes, let's do that.

David: And you’ve just been making a salary at TechTV.

Kevin: Yeah, exactly.

David: You didn't have equity in that.

Kevin: I had $10,000 in savings and I'd spent a lot of it on building the prototype of Digg. My girlfriend was pissed at me for that. Basically, he came in, but he sent me a term sheet and it was like, you get $200,000 upfront, and then if you hit these milestones, you get another $100,000 here. It was really complicated. I was like, I don't like this, we're growing a lot.

I ended up saying no and actually raising money instead. But he said to me during that lunch, he was like, you're one of the biggest Web 2.0 companies. Literally, I thought, is there a software I need to upgrade on my servers that makes me Web 2.0? I was like, there's something I'm not aware of I need to upgrade because I'm not Web 2.0. I did not do that upgrade. I had never heard of that term before.

Ben: Which is so fascinating, because to me (and maybe it was a couple of years later), Digg was the embodiment of Web 2.0. It was dynamic content. It was Ajax. It was user-submitted content. It was what became social media.

Kevin: After I found out what it was, I was like, of course I'm Web 2.0. Yes, of course we are. I have no idea what it was.

Ben: It's this amazing thing that I think the people who are the deepest in a thing that's becoming a thing in the world aren't the people who get to name it, which is the most fascinating thing. When we were interviewing Vlad from Webflow, he was like, I found out two years ago that we were a no-code company, but our company is 11 years old. Good to know about this no-code thing. Now, of course, they have embraced it, have the no-code conference, and all this stuff.

David: On your show, you're having all these awesome NFT artists on. I feel like that's their story. The people and everybody are like, yeah, I don't know, I'm just making my art.

Kevin: It is one of those things that almost everyone, a lot of entrepreneurs that I meet, it's a dirty secret. You go back and you look at these different covers of magazines and this great success and no one really has a clue that they're ever going to be as big as they become when you talk to the top companies that are out there. It's always like, this should exist, I'm going to go build it. But 99% of the time it's quite shocking that it gets as big. You don't really plan that.

I remember when Uber first came out. It was like, how many people are going to get to other people's strangers' cars? I guess it'll work for black cars. It'll work for black cars. That's what it will be, and that was the launch. The plan was black car service with an app. Never did the founders ever dream it was going to be applied to a random Toyota Corolla. That was never imagined that you would feel comfortable.

David: You must have known Garrett from this whole era, right?

Kevin: Garrett and I were really good friends. He had created StumbleUpon. We didn't see each other as competitive, really. Garrett and I, we're really close in Web 2.0 days. We would just go have beers all the time and talk about features and building out some of this stuff. But then I later ended up dating his ex-girlfriend and then we had a little—it didn't go over so well, but we're cool now.

David: That's why J. Cal invested in Uber and Angel invested in Uber and you didn't?

Kevin: That would be a big reason why I did invest in Uber. But we're good now. It's the dumb shit you do in your 20s. It was such a small thing though. You have to remember that Web 2.0 and this whole world really isn't as big as a startup scene as it is today.

When we would go up in a bar, we say, okay, Fly Bar in Divisadero in SF, let's go hang out. Let's grab some beers. It was easy to grab Garrett from StumbleUpon and get Josh Schachter from Delicious to show up to something, or Ev from Twitter. We would just all hang. We never knew that these projects were going to be that big. We were just having fun building software

Ben: Meanwhile, let me just insert a midpoint. Today, Tech is like the five biggest companies in the world. Kevin, you're describing this era where basically all the people that run a lot of those big companies started them, were involved in the founding, or where angel investors are hanging out getting beers. There's this interesting midpoint that I remember viscerally where I went to South by Southwest in 2011. You and Alex were doing a live Diggnation at Stubb's Bar-B-Q—huge outdoor, great barbecue, but concert venue.

Kevin: Yeah, 4000 people.

Ben: It was huge and I'm pretty sure after you did the show, the Foo Fighters played.

Kevin: Was it the Foo Fighters? No, it was a big band though. Was it the Foo Fighters? I wasn't a fan of the Foo Fighters, so maybe it was. But I remember there was a big band we had played for one year that I wasn't a huge fan of and everyone thought it was a big deal. Then we had The Walkmen play another year, which I was a huge fan of. That was awesome.

I stuck around for that one. I was like, oh, this is really cool. But that was the cool thing about South by. You have these big bands coming in because they would play music for the next week, and they’d come into town early and it was easy to book someone. I remember Snoop Dogg was going and doing different South by things because he was going to be out there anyway for the following music week or whatever. It was easy to get a big name to come play at your little gathering.

Ben: That makes sense.

David: Podcast live show?

Kevin: Yeah.

Ben: It still definitely accomplished this feeling though of me feeling like as someone who was totally following this all from the outside because I was in high school and early college in ‘05 to ‘09 and feeling like there's a bunch of insiders. I'm not part of the insiders, but they're spitting distance away. Where when I grow up, I want to be like one of them. That Diggnation moment where I was looking around at South by, I was like, oh, this is pretty mainstream. This has become a part of culture.

Kevin: Dude, it shocked us all. Literally, we booked that venue and I'm like, I hope it looks like there are enough people here, otherwise this is going to be a little awkward. We had no idea that that many people would show up. It was crazy because I brought my dad out to that show and my dad had really no clue. He'd seen that we did these live Diggnations and I hid it from him because he didn't like me swearing a lot even though he swore. I think he'd be cool with it today if he was still around.

Anyway, he saw that show and saw all those people. Then when we left the venue, all these people were, back in the day, trying to come up and get my autograph and all that stuff. They followed me out to the car that we were getting into, which was just crazy because I was like a geek and to have that kind of treatment was odd. But my dad saw all of that and my dad was just blown away, and he ended up passing away two years later.

It was a special moment for me because we didn't have a whole lot growing up and my dad was really proud. I'm just really glad I had that. I decided to fly him out. I didn't know whether I should or not and I was just like, okay, I should fly my dad out because he should be part of this. It was just like it was the right call. Those are very special moments for me, for sure.

Ben: I bet. There's an interesting looking backward moment there where that probably applies universally. It's almost always the right call. If you're like, should I do something that overextends myself financially or is an inconvenience or something to have a family member come see, something that could be special? It's almost always the right thing to say yes.

Kevin: Yeah. Experiences, I would say, are definitely the number one thing to invest in. They're the best money spent.

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Ben: Gosh, I could do this absolutely forever. I do want to talk about some Web 3.0 stuff. I think we have a little interlude in the middle where I want to talk about before you became MoFi, Kevin. But after Digg, there's some interesting chapters in there.

A lot of the things that you're observing about that era feel similar to what's going on in crypto right now. It's the true believers. Everybody knows each other. There seems to be a lot of real, genuine information sharing and just belief in a common purpose, even though everyone interprets the purpose differently. Does it feel like that to you too?

Kevin: It does, yeah. I would say this is the first time since Web 2.0 where I felt that type of connection and camaraderie around a new technology that the mainstream has yet to embrace. It’s starting to embrace, but is yet to embrace. We're all early, we all see it, and we all believe in it, and it's just a matter of time. Time creates confidence.

Ben: It's interesting you feel like it's the first time since then because you look at all these theoretical waves since then that the media and VCs were calling the next big thing, some of which have been. Machine learning is a reasonable one. Obviously, there was the mobile wave after the social wave.

Kevin: The mobile wave felt like a land grab. It was very obvious. The mobile wave was something where when the iPhone came out, everyone's like, oh, of course, this is going to be huge. There was no doubt, and it hit consumers' hands immediately. There was none of this you have to believe. It was a given.

David: It was an expansion of the existing Web 2.0 market, really. Instagram was Flickr. WhatsApp was AIM. The analogies were 1:1.

Kevin: Right. Then the big players are like, we’ll just make apps. Facebook made a mobile app and Twitter made a mobile app. That was just an easy transition for them.

Web 3.0 is very much like Web 2.0º. When Web 2.0 first came out, people were like, I don't know if this is going to be big. What are these social network things about? Am I really going to show people what I'm into by voting on things? There's a lot of, I don't know if I believe this to be true. And that's the same thing that's happening in Web 3.0.

Is this crypto thing real? Is it really going to scale? Are these NFTs really collectibles? Are just people making up stuff? There's a lot of doubt there. That's the kind of excitement. There's an excitement that you get when you see something early that you believe to be true, but everyone else disagrees with you. That's always kind of fun.

Ben: There are so many more entrepreneurs like you’ve said, NFT artists, entrepreneurs, DeFi projects, where they're building stuff, because they’re like, I'm in this community. This needs to exist. Not like, hey, I've got this business plan. And there's this obvious seam I'm going to attack.

Kevin: It's true. I'm a partner over there. We don't invest in business plans. We sit down with an entrepreneur. We listen to their ideas. We want it to be new, novel, and exciting. And if it works, it should be massive. That's what we get excited about. We want to back incredible people building very ambitious things.

David: Okay, so let's talk about during this transitional period, what was your journey like in crypto? When did you first hear about it? When did you buy your first Bitcoin? How did we go from the end of Digg to MoFi?

Kevin: It's a great question. I'd have to go back and search Twitter. I think I first tweeted about Bitcoin in 2012.

Ben: Have you ever searched your Gmail to try and figure it out? You can use the ‘before search operator'. This is kind of a fun thing to do. Open your personal Gmail, search bitcoin or crypto, and figure out what the very first mention of it is in an email exchange.

Kevin: Oh, that's interesting. The question is, yeah, I guess I would have had that in—I had never even thought to do that. Can we stop down for a second while I do that really quick?

Ben: Yeah, let's do it.

Kevin: Let's see here. So the first email I have about Bitcoin is June 12, 2011. It's an angel investor business plan. Andre from Canada says he likes Diggnation and Foundation and wanted to tell me about this idea around Bitcoin. That is the first time that I actually see it mentioned in my inbox.

The first Coinbase transaction I have is from—apparently, I tweeted out my Coinbase link to get referrals and they were sending me—Tuesday, August 14, 2012, I started receiving a 10th of a Bitcoin point (0.1 BTC). This is what it says, “Hi, Kevin Rose. Coinbase just sent you 0.1 BTC worth $1.13 USD using Coinbase. Congratulations. Your friend.” Then there's email address. “We’ve verified their account on Coinbase. We've credited you 0.1 BTC to your account.”

So I started getting a quarter of a Bitcoin and then I have just dozens and dozens of those emails worth $1.16 or a quarter. Bitcoin was pretty cheap back then. That means that I had a Coinbase account back in mid-2012.

David: Okay, awesome. We're going to get back to Coinbase in one second but we got to have one little digression. You mentioned Foundation. It's Trent Reznor, the music in the beginning?

Kevin: Yeah. He had a starting music on Foundation. That's another little show I did where I interviewed entrepreneurs.

David: How did you get Trent Reznor music?

Kevin: Well, he released that as a complete open source and he got rid of all the rights.

Ben: All the stems, right?

Kevin: Even the tracks. He had one album where he just released the entire thing to be used for any purpose. I don't think he had a commercial right in there but we were non-commercial. We weren't putting any ads in or anything so we used that. I had a chance to go and visit Trent at his house. Before they asked me anything, we did these things called Digg dialogues where people could vote for questions for people to ask. They asked so we had the community vote up their top questions for Trent Reznor. Then I went and interviewed Trent and that was a ton of fun.

David: Oh, that's so awesome.

Ben: I love searching for old tweets and old emails as you can tell. In preparation for this episode, I think the first time I tweeted about Digg was a link to the Digg dialogue with you and Trent.

Kevin: Oh, that's awesome. It was so much fun to do that show with him. His house is crazy. He's got the most rock star, coolest house ever. It’s all dark, leathery, and has cool-looking dogs. Everything about his house is cool.

Ben: He's such a pure artist.

Kevin: Yeah. Well, we were chatting, we were talking about all this different stuff, and we were walking out and he's like, “You want to see my recording studio?” Because he's got one in his house.

David: Now I got to go.

Kevin: Yeah, exactly. In my mind, you don't understand. My high school years were all about Nine Inch Nails. That was my favorite music and it sounds like that, kind of nonchalantly. I was like, yeah, I’ve got time. I’ll check the recording studio. We just walked down there and it's exactly what you’d expect. It's like you walk into this room. It's all soundproofed and it has racks of old analog equipment with wires going between them like a mad scientist’s room. To be a fly on the wall in this room is just so cool.

Ben: Like he's creating all this music with real analog electric signals running through you.

David: Yeah. Which is how all those guys used to do it like Fat Boy Slim. There are a bunch of great documentaries out there about it of that era now where it was digital, but the source was analog.

Kevin: Exactly. I love it.

Ben: All right, Kevin. Bringing us back, I found your first three tweets with Bitcoin in it. In June 2011, you tweeted, “Testing out Bitcoin. Can someone send a couple of cents to this address? Thanks.” And then you have a wallet address.

Kevin: Yeah, that address I lost the keys for so you can look up that wallet address and I think there's over a Bitcoin in there or something like that.

Ben: You and everyone else man.

Kevin: Yeah, I'll never recover that. If you pull up that tweet, please do not send any more Bitcoin to that.

Ben: Second one, for those asking about Bitcoin. This is also in June, “More info here. We use coins.com. Still haven't got any coins. Must be doing something wrong.”

Kevin: I started mining back then.

Ben: Oh, then here it is the big one: 2012. “Playing around w/ Coinbase (a new startup that hosts your Bitcoin Wallet), check it.”

Kevin: Yeah. So that, Brian, I had him on Foundation. Brian Armstrong, the founder. I saw him at demo day at YC. I told him I want to invest. I was investing in Google Ventures at the time. I was a partner at Google Ventures. I brought that to the Google Ventures team. I won't call it any partner in particular, but let’s just say, one partner who I absolutely adore (and I'm not going to call them out, but if you hear this I adore you) called it [...].

This was a valid fear back then. I'm not slamming this person. You have Google corporates’ money. What if you invest Google corporates’ money and it's something that becomes a scam later down the road? That does not look good for Google

Ben: This is a great argument against corporate venture because that is basically what venture capital needs to do in consumer.

Kevin: It's okay, I ended up investing in Columbus a little bit later personally. It all worked out. But Brian's an awesome human. We got him some great early exposure through that Foundation. I just am delighted that we helped get that company off the ground. Really recently (maybe three or four months ago), he told me that people still refer to that Foundation episode where he was on the first time they actually got into crypto. So we got a lot of people on board with cryptocurrency with that.

At the end of the day, that is the thing that gets me excited about doing the Foundation podcast, about doing podcasts around finance. The reason I don't take sponsors and I don't try to monetize this stuff is like that's not what it's about for me at this point and the stage of my career. It’s about getting more people on board and excited about these new and upcoming technologies, and hopefully helping them avoid a lot of the crap that's out there.

Because anytime there's money involved, there are people that are trying to scam and take advantage of others. And I want to put out content because there's a lot of that other content out there. There's a lot of people on crypto Twitter, not the groups that I run in, but if you just go a layer or two deeper, you'll see so much shilling, flipping, and trying to pump and dump. That's the stuff we need to get rid of.

Ben: Do you have any hot takes on something that has a large user base but you feel is pretty scammy?

Kevin: Well, I would say that it depends on what the goal of the project is. There's a lot of knockoff projects that happen like Dogecoin for example. When it first got started, I had Jackson Palmer, the founder on my podcast as well on Foundation. It was meant to be a cryptocurrency that could be used as a way to more or less give away for good deeds. So people were using it to tip. There were all these Dogecoin tipping bots on Reddit.

David: Yeah. Vitalik got a ton of Doge.

Kevin: Back in the Reddit days of when Doge first launched, people were using the tip bots and they would send 1000 Doge here or 2000 here. Oh, that was a great comment. Here's 50 Doge. That's why the supply was so large. He wanted to create this enormous supply so it wouldn't be hoarded. It would just be this fun thing to create this little tipping economy. I thought that was a really cool idea and one that was worth playing around with.

Now, there are a lot of knockoffs and clones of that with not the intention of pushing technology forward in any meaningful way. But with just the intention of price appreciation because they want to jump on, ride it, sell it, make money, and rinse and repeat. And you see that happening over and over. So those are the projects that I think are to be avoided. I certainly believe that Doge did not have that intent. I know that they didn't have that intention when they launched. It was not a pump and dump scheme. It was just like, let's have fun with this and see where it takes us. And that was the thinking there.

Ben: It makes total sense. Anytime there's a new paradigm or a new opportunity, everyone's mindset has to shift to become a believer in the new thing. Look at Web 2.0. The easiest thing to do would be to say, no, why would I submit stories that other people could see?

David: Or even worse, I remember my parents—Ben I’m sure you remember this—being like, don't put your personal information on the internet. Don't join Facebook.

Ben: Which it turns out may actually be pretty good advice. I should be more succinct. Anytime there's a paradigm shift, it requires a leap of faith to become a true believer in the new thing. The earliest people that have to do that, there's the most upside for them because they get to be early to that thing which could accrue them reputation or actual shares and whatever the new thing is, but it requires that leap.

So it's really easy when you are someone who's looking around and seeing other people become awakened to this new thing to have some shyster convince you that, oh, you should just become awakened to my new thing too. That looks a lot like the legit awakening that's going on with other people that's paying big dividends for them.

Kevin: Right, and I get that. I think that you have to ask your question—this is happening in the NFT spaces as well—what are the real motivations of this project? So I will certainly miss some things that started off as a joke, eventually had real legs to them, and evolved into a place where they are innovating in some interesting capacity. That means multibillion-dollar kind of ideas out of a joke. That will happen. Communities will form and they will evolve and make something that is more than just that initial kind of hype cycle that happens that we see a lot.

For me, when I evaluate new cryptocurrency projects, I always look through the lens of, is there a use case here that needs to be solved that this company is going out and solving? Is it a credible team behind it? And is there a discussion of price appreciation? Is that the main topic? Because the easiest way to see through a scam is to look at what are people talking about?

Are people talking about the mooning of the coin, the price going up? Or are they talking about why the underlying technology and what is being built are so important for the future of the world? And if the conversation is around making money, there's a good chance you're in something that is going to be some type of pump and dump where eventually this has the bottom fall out from underneath it.

That's how I try to evaluate things. It's part of why I want to start focusing and having more NFT-related content is because there's a lot of that happening in the NFT spaces as well now. It's like anyone armed with Photoshop can instantly churn out 10,000 characters with different glasses, hats, goggles, and all that other stuff. People call it aping into something where you just go all in. People see this and they ape into something, and a community can be built around that. You can have some serious growth there. But I worry about the long-term durability of these projects.

Is there going to be so many of them that they just seem all copycats and clones? For me, that means I'm very selective about which investments I place there and I do consider them investments.

Ben: You're talking about when you personally buy an NFT?

Kevin: Right, exactly. An NFT or cryptocurrency. But when I personally buy an NFT, I'll say first and foremost, what's the price point? If the price point is hundreds of dollars and it's something that you could afford to lose if you had to, then I want to love the art.

I bought some cool cats a few weeks ago. It wasn't because I thought cool cats were going to be the next crypto bongs. I just thought they were cute little characters. I like to swap out my avatar from time to time. They had a great community that was following them and they had plans to launch other little cool cats-related things. I'm like, this is a fun little community.

That is why I went in and bought a few of them at lower prices, and I'm okay with losing that money because there's no money to be lost. I'll always consider them fun little things that I can put into a digital frame or have them up around my house. It marks a moment in time when I thought that was cool. So that's fine.

When it comes to spending real dollars and actually making an investment, then I'm looking for more blue chip-related stuff. That is, in my mind, projects that are not clones but that were actually the first at something. The first fully on-chain generative artwork or CryptoPunks to finding the ERC-721 standard and being the first to put that out there. Those are the projects I look at. Those will always historically look back and say those were important for this space, if you believe in the NFT space. And I think they will have long-term collectability and durability from a price standpoint. So that's how I look at it when I'm buying those things.

Ben: It's funny. Implicit in what you're saying is the very same reason why the founders of some new groundbreaking consumer thing always have way more upside than any investors or anyone who comes later. It's because they were true believers in the thing for the value of the thing, even before it had any notion of being an investment.

Kevin: That's right.

Ben: That's why oftentimes, anybody who's seeing a trend and saying, I got to get in on that, and they develop their business plan just to use the same parlance that we used earlier. That's why there's always less opportunity there than in the initial core community where there's a lot of heat.

David: It also strikes me the parallels to modern art. Anybody can make a knockoff painting of a Campbell soup can or Marilyn Monroe, but nobody was doing that before Andy Warhol. It's just such an obvious analogy here.

Kevin: There are things on the NFT side that are first. There's certainly some of the programmability that you can do on NFTs and what's coming there is really interesting. There are going to be new genres of art that are created, which is a very exciting thing.

This idea of generative art, like what's happening with art blocks, and that the user doesn't know what they're going to receive when they make a purchase for the first time. That transaction hash is used as part of and fed into the algorithm that actually generates the art. That has never really been done before in a way that we could capture and hold on to it. It could have been prototyped and done in a way that could be displayed a decade ago, but there was no way to prove ownership.

There are some really cool things that I'm seeing and I'm excited for the depth that is going to be coming to NFTs, rather than it just being about a place to mint a JPEG or a GIF. There's some really cool new thinking there that I'm excited to hopefully invest in.

Ben: Were you into art before NFTs?

Kevin: Yeah, I have been for quite some time. Not in a deep way, but it's something that as someone that has built a bunch of projects, I've always kind of been a usability, a feature, and a branding kind of person. Everything that I've created has always been the names that I've come up with, logos, and things like that. I always work very closely with designers on iterating and refining. I'm someone that can appreciate it. I've always been a big fan of certain artists. This is just like a whole new level. These new digital NFT artists like XCOPY, and some of the people that are just doing really bold, fun things I just get really excited about.

Ben: I didn't realize it until now, but you're the perfect person to really understand a lot of the value with NFTs because, in a lot of ways, you're an artist yourself. You look at a lot of the products you've built that have always had really strong design sensibility in things like watches. Even the more recent apps you’ve built with fasting. It's called Oak, right?

Kevin: Yes, Oak, the meditation app.

Ben: It's very clear that you have a strong point of view on how something should look, feel, and be as an object to use. Also, you have this great investing lens at True, formerly at Google Ventures, and doing all these incredible angel investments, and have been a founder. It really is this fascinating convergence of art, investing, and the internet that is like this Kevin Rose stew.

Kevin: I like that stew. It's a good stew. That's a great way to describe it. Those are all the things that I care about. And for me, that's what makes doing these types of podcasts just a lot of fun. That's why I want to produce more of this type of content. I love chatting with these artists, these founders, and these creatives who are doing new and exciting things and bringing that awareness to other people.

Ben: I'm curious, how did you get hooked up with True? Do you know Om?

Kevin: I knew Om from back in the day. He used to cover Digg a lot when he was a writer. True had actually backed and invested in my company—Milk—that I sold to Google Ventures. Then they went on to back Hodinkee and Zero, so they've backed several of my companies. I just met them and just fell in love with the people there. They have a fantastic team of very low ego folks.

Ben: I love everyone at True. Anyone that I worked with—I always walk away feeling like, oh, that person has the longest view in the room to use a Sam [...] parlance of caring deeply about relationships above all else.

Kevin: That's it, exactly. They’re such long-term, long-view investors. We pride ourselves in trying to take all the pressure off the entrepreneur. We backed Matt Mullenweg from WordPress 15 years ago. We still have a board seat. We still have stock, and we're not saying hey, you have to go IPO or you have to sell. That's not in our DNA. It's their baby, their company. They invited us for the ride. Who are we to go try and force outcomes and do all the mean nasty things you read that other VCs can and have done in the past?

I realized that working with True early on when I was going to sell to Google. It was going to make a tiny bit of money for the investors but not world-changing money. The partner I was working with was like, Kevin, this is your company. Do whatever you want. If you want to go sell it, then sell it. If you think the time is right. Make it happen. As an entrepreneur, you have so many things that you're trying to juggle in your head and wrestle with. Just knowing that your investors are not one of them is one of the reasons why I was attracted. I said, I have to work with this group. And that's how we got hooked up.

Ben: You initially became a venture partner then transitioned into a full-time partner role?

Kevin: Yeah, I was a venture partner. I was still building stuff. I built Zero and we decided to bring that. Mike Maser took that over as CEO and then we funded it at True.

Ben: Mike Maser, your first boss?

David: Mike Maser, the dude who hired you?

Kevin: Yeah.

Ben: That's awesome.

Kevin: Yeah, Mike and I just remained friends for a long time. I hired him to work for me at Digg. He first hired me. Then he left the office company, went and started working in Electronic Arts, he was a VP over there. Left EA, was a VP at AOL for a while, left there, and then I hired him to run marketing and BD at Digg.

Ben: Wow.

David: That’s awesome.

Kevin: He's the one that got me into fasting because he had a really serious stage four cancer that he beat back and went into remission. In conjunction with chemotherapy, he also implemented fasting. He's a big believer and so he took it over as CEO.

Ben: So how did you make that call of sitting in that emotionally of, I'm a venture partner. so I'm helping to bring great entrepreneurs to the firm. It gives me lots of flexibility where I'm not—were you sitting on boards at that point?

Kevin: No.

Ben: So you have time to sort of tinker, explore, start things, build, do media, and transition into that full-time partner role to have investing in your day job. How did you make that call and how does that feel?

Kevin: I will say I was sitting on boards just not related to True. So I was on the board of her Hodinkee, the Harlan Estate, the Tony Hawk Foundation, and a few other things. It was one of these things where building is a lot of work. It is one of those things that you have to go all in and give it your all.

So for me, we had just had our first kid and I was just at this point in my life where I realized that I didn't want to go and do another startup. That's kind of the venture role thing. You're trying to figure it out. Should I do another startup? Should they fund me again? Should I go into this? I thought I wanted to optimize my quality of life a little bit more. You know what, I think I'm going to come on. If they'd had me, I'd be an investor there. They were like, hell yeah, let's make it happen. So I joined full-time a couple of years ago and have been doing deals ever since.

Ben: That's really cool. Are you looking at crypto stuff in particular?

Kevin: Yeah, I would say that 95% of my day job is evaluating cryptocurrency or blockchain-related companies, along with NFT-related stuff. We've probably deployed 75 million this year into blockchain-related startups. It's a decent chunk. We have a $750-ish million fund, so it's a big chunk of the fund.

Ben: Ten percent of a fund in a particular industry is pretty heavy.

Kevin: It’s pretty well-diversified in that it spreads across a whole slew of different protocols, coins, DeFi, scaling solutions, and NFT projects. A bunch of different things there. We're firm believers in the future of blockchain. There's no doubt that this technology is going to change everything, especially the financial, collectibles world, and gaming as well.

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So this brings us to the perfect place to start to wrap here. MoFi, I think you've explained throughout the whole thing why you're doing it, this whole conversation? Where does it go from here? You could just keep doing what you're doing and it would be great. It's got magic, it's wonderful. But it's all about crypto and Web 3.0. It feels like there's also so much more than what used to be social media can become in the Web 3.0 world. How are you thinking about it? You could have a [...] or you could be doing all sorts of stuff?

Kevin: Yeah, it's a good question. I think that I'm starting to see two individual worlds starting to separate a bit. In some sense, you have traditional cryptocurrency, scaling solutions, and DeFi in one bucket. Then you have all the craziness that's happening with NFTs in another bucket. I'm actually going to be launching a new podcast that is dedicated to all things NFTs. Just NFT content. It's going to be called Proof. So proof.xyz is the domain name.

Ben: That’s a great domain.

David: That's awesome.

Kevin: Thank you. I'm excited. Proof is going to be just going really deep on all things NFTs. That will cover everything from the art and programmable side of things, to the generative side, to tokens that cover DOWS and what they’re doing, to the gaming world, how NFTs unlock different assets, and how people are buying virtual land as NFTs. We'll just cover it all there.

Then Modern Finance—the podcast, will still do an occasional little really important piece on NFT. The people listening to that won't miss out on the big, deeper people of the world, or when you have someone really big that you want to get out there. That will focus more on everything that's happening on DeFi, scaling, and new coins. There are two camps where people are saying, give me more NFT content; then there's the other camp being, get back to some of that crypto stuff that we miss. I'm like, I can't please everybody. So I got a break.

David: It's funny. We're getting, hey give me more of that Atari, like the classic tech history, or even just non-crypto stuff and people are like, give me more crypto.

Kevin: Yeah. You know what I'm talking about. You can't please everybody. So for me, it's just easy to carve out a separate feed. Listen, the best of the best from Proof, the big names will always make it to the main Modern Finance podcast. But if you want to hear about the new and upcoming artists that haven't broken out yet—but I think are really cool because of doing something unique and novel—you're going to find it on the Proof podcast, so it should be fun.

David: What's your strategy for launching? Are you going to do the first couple of episodes of Proof in the MoFi feed and then spin it out?

Kevin: Most likely what I'm going to do is make an announcement. I had the CEO of SuperRare, which is one of the big NFT platforms that I just recorded. I’ll announce that at the beginning of that episode when we drop it on MoFi and then people can go subscribe.

I'll probably backdate and put all of the NFC content that we have in MoFi into the new feed. So if you come into that feed, people can always jump back in time and say, I want to listen to that interview with Snowfro, the founder of Art Blocks. The ability to jump back and hear that or hear when I interviewed the founder of CryptoPunks. It will be pre-populated with probably five or six episodes. Then I'll start releasing a new NFT episode, hopefully every week to week-and-a-half. I would say probably one a month or so of those will make it to the main Modern Finance feed.

If you are subscribed to both, you’ll know. I already listened to that one. I don’t need to click it on MoFi. But then MoFi will be more just like big-name people in the crypto industry, both in terms of creators, and then people that are analyzing it and where it's going. Talking through where DeFi and how it's evolving and some of the new and interesting projects and more of that. It's going to be a lot of work, but this is the stuff I love to do because I feel like both of these industries are filled with confusion and a lot of hype. Remember the ICO world a few years ago, there were so many scammy projects there. I hope that people can come in and know to trust me that I would not want to promote something that is a scam or that is just there for the hype. I’ll always call out why they're on the show and why I think it's worth covering so it won't be everything. It'll be a subset of what's out there.

Ben: I'm so glad you're doing this because I would say I've been a late comer in almost everything in crypto. I guess in some ways all of us who are currently participating in the ecosystem are early adopters because there's going to be 10–100x more people after us. But I would say it took me listening to the Beeple episode.

David: Which is so good, by the way. Oh my god, Beeple, what a character. I love that.

Ben: I just want his accent. I want his manner of speech. It's so fun.

Kevin: Oh my god, he's the best. He's hilarious. It couldn't have happened to a nicer, crazier dude.

Ben: Truly, but it took me listening to that and several other of your NFT episodes for it to click. When NFTs first started becoming buzzy, I was definitely one of those people that was like, the whole point of digital art is that it's infinitely reproducible. Why would I pay for something? I was definitely one of those people.

First of all, learning about the artists behind the art is actually the value. Feeling close to those artists and why they're doing what they're doing—that is the reason to buy it, at least in my opinion. Sure, it's cool and it's fun to look at. It was also the realization that he brought up. People are buying NFTs. People finally have a vehicle to value digital artwork. Digital art has been a thing for 10, 15, 20 years in this format. But there's been no incentive to make it since it's just infinitely replicable and easy to rip off.

Finally, there's an incentive for artists to make incredibly cool stuff and rare stuff in a way that is totally driving the level of creativity and innovation here because there is actually now an incentive for it.

Kevin: Yeah, there are so many pieces that unpack. That is a major one. You nailed it. I'm a little older than you guys, but you guys are old too. There is a younger generation that grew up skinning their characters in games and is so used to purchasing and holding virtual objects and virtual goods.

There was a survey that was done. That there is a very large subset of gamers—more than 50%, it was something really scary—that consider their online identity in their games to be more important than their offline, in-person identity.

David: Which actually makes total sense when you think about it.

Kevin: It makes total sense. And you have this world of people that have grown up digitally native that say, I want to be able to show my friends something cool on my phone that I own. When they get older, they're going to say, flip it up on my wall and have it as something I can show on my wall. And guess what, if the house burns down, I don't lose my painting and I don't have to worry. For me, I think about when my kids walk by something, I don't worry about them taking a marker to it.

There are just so many beautiful aspects to portability and how you can showcase your favorite pieces of art. Also just how you can unlock the potential. When they're programmable, what if my art changes over time and the artist bakes in certain things that unlock it the longer I own it? Some of that is just so cool. There are so many aspects to this ecosystem, what NFTs bring to the table that you can't have with traditional art that I think is going to take another decade or so for people to really wrap their head around.

Do you know that back in the day, when canvas was created, there was a huge blowback on it? There's a huge blowback on canvas because everything was painted on walls or on these wooden.

David: Frescos.

Kevin: Yeah. To move to canvas, many people thought during that time, it's portable, why wouldn't you want something permanent? It can be taken and copied. There were all these worries around moving. So a lot of canvas art was actually worth less than things that were actually more permanent on the wood or on the wall. So it was just like this transition that happened. It took a while for people to finally adopt canvas. I just thought that was a hilarious story.

The same thing is happening here. There's something really cool about being able to walk into a gallery, bar, or wherever you are and see something on the wall and being like, wow, that artist really connects with me. Oh, it's $700 worth of ETH? Scan a code, it transfers to your wallet, it disappears on the wall, something else appears there, and now you own it. That's freaking cool. That is going to happen.

Ben: Thinking here about the future of MoFi, Kevin, you're too much of a tinkerer to just let it be the final form of MoFi is I record an mp3 and then I toss it into some podcast players. Is there an on-chain version of content media? Something that could make sense for MoFi?

Kevin: It's a good question. That's a very, very sharp and pointed smart question. Of course. I don't think of it as much for MoFi as I do for something like Proof where I think, what can we do that is unique? Well, you'll just have to wait and see.

Ben: I can wait and see.

Kevin: I went and built Hodinkee for a few years and Hodinkee was kind of a proxy for what Proof might eventually become. We did a really in-depth editorial around mechanical timekeeping and watches. That attracted millions of people per month, it still does. There are 150 people that work at Hodinkee right now. It's a massive enterprise.

Ben: Hodinkee has this unbelievable characteristic. I think you guys did this best in the entire world of using content to enrich the value of purchasable goods. It is half a content business, half a commerce business, and they are so wonderfully intertwined. More people should take a look at that.

Kevin: Hodinkee, they got that blend. Ben (the founder) and myself, when we sat down and we started planning out ecommerce—wanted to make sure there was a church and state line between editorial and ecommerce. Because it's very important to be able to have independent critical pieces written about watches that you may sell. We had to make sure and draw that line in the sand and let the brands know that we can be critical about your watches and talk about them. If we don't like the way that something is manufactured or you cut corners on some of your movements, it gets really geeky.

For people that aren't into the watch world, think about the mechanical insides of the watch. Then think about the most hardcore vintage Porsche collector. They care about every little tiny detail inside of that machine. That is the engine inside of this watch. The geeks. That's partially why I'm attracted to it. Some of my favorite watches are not expensive showing-off watches. They’re watches that would never get any attention at a party in New York, but they're meaningful because of what's inside of them.

You know when you go and you pick up an Omega that has a 321 movement—that was the exact internal engine, the exact movement that was taken to the moon. That is awesome. That's the kind of geekiness that got me excited about watches.

That's what I want to bring to the NFT world. I want to talk and go deep with these artists and talk about what drives them and how they created some of the first. Especially when we're on the programmability of this stuff. It's going to be really fascinating. Eventually, when I have Dmitri on who created one of the most popular projects out there called Ringers, I want to see code snippets of the Ringers project and put that into the article and show. That's the geeky level I want to get to so that's where I'm hoping to take Proof.

David: I don't know if this is how you're thinking about things, but with watches, it's like this little preview of what it could be. But the thing about watches is the super rare stuff—it was hard to get. My dad's really into watches. But you can also buy it anywhere. You don't have to buy it at Hodinkee. You can buy it at Hodinkee, you can buy it elsewhere. That may or may not be true depending on where you go with Proof. It's not a retail environment.

Kevin: The thing is for us with Proof (and this is what Hodinkee did as well) I don't think of these businesses being built in the next six months to a year. We need to spend the first three years gaining trust. The main thing is in-depth editorial, content that is worth reading, and a brand that you can trust to bring the best artists to you and explain why they're the best. That means are above and beyond me.

I'm going to be looking to hire editorial folks that are both traditionally and classically trained art critics that are also embracing the NFT world and give us both perspectives. We need to know why something might be historically important when it comes to the new stuff that's being created on the NFT front. It's going to be a fun little adventure.

Ben: I found a whole new thing that I'm imagining I’m going to be very geeky about. I'm excited to listen and tune in, Kevin.

Kevin: Awesome. Well, you're the first listener. Thank you so much.

Ben: Sweet.

Kevin: It’s not out yet, so it might be by the time this podcast is out.

David: Is it proof.xyz?

Kevin: Yeah, proof.xyz. There'll be a link up there to subscribe to the podcast even if there isn't an episode out yet. There will be the historic ones that we've done so far. That'll be the best way to join. Of course, modern.finance is for all things crypto. That's where we go deep on all the crypto stuff, and that's a whole nother can of worms. It's a lot of fun.

Ben: It's awesome.

David: Probably our biggest segment of the Acquired audience is entrepreneurs or aspiring entrepreneurs. Where can folks get in touch with you with True?

Kevin: It's kind of hard on the True side. I would say, 90% of our deals come from referrals from entrepreneurs that we've already backed. So we have a little over 300 entrepreneurs that are referring new companies to us. We use that as a filter because if you just had an open submit form, you would just be overwhelmed. It would be impossible to get through. So if you know a True company that's the easiest way to get a hold of us.

Outside of that, my DMs are always open on Twitter. I try to go through them once a week, but sometimes it gets a little crazy. For me specifically, I'm looking at all the new cryptocurrency blockchain-related and NFT-related deals. If it's something outside of that realm—unless it's health and fitness, which I also am very passionate about—or some consumer internet stuff as well, I'm probably not the right partner for you to pitch. Those are probably the best ways. Definitely through the network of founders who we backed.

David: Love it. One last little tidbit before we go. You said Twitter. How’d you get on the suggested follow list that happened at the bar in San Francisco?

Kevin: Yeah, that happened in TED. We were down at a TED conference. This was when it was in So Cal. It was me, Evan Williams, and Chris Sacca at a bar having some drinks. This is when Twitter first started taking off. We were just talking to Evan. Dude, this is crazy. There are a thousand people signing up per day.

At that point, I think it was probably hitting 10,000+ new users a day. It was clearly working. And Sacca is like, hey, you think you can add Kevin and I think to the suggested user list? Because it was a manual list. It was one of those things where it was just hard-coded. There was no algorithm. He looks at us and he's like, all right. So he pulls out his phone and he literally does it right there on his phone. He's like, okay, done. Thanks, dude.

I had turned on notifications for any time someone followed me because that's how small it was. And instantly, my phone was like boom boom boom. I'm like holy crap dude, this has taken off. When I turned off the notifications. I was just getting so many followers. Then it kept growing, growing, growing, and they kept that suggested user that's the same for a very long time.

Then I got this retweet from this woman. This is a month or two later and I looked at the icon and that girl’s cute, and I clicked on her. She was a foodie, lives in San Francisco, into wine, into health and fitness, working on her neuroscience Ph.D. Who is this? And it was now my wife, Darya. And it was all because she added me to the suggested user lists. Actually at my wedding. I actually called them out, Ev and Sacca, to thank them for making that happen. That’s how I met my wife.

David: I hope you did something really. Can you get him like a Beeple or like a CryptoPunk?

Kevin: I'll have to see if he's into NFTs. I haven't asked him about that. I haven't seen him as much now that we've had COVID, but there should be a gift. I know I've sent him some nice bottles of wine in the past.

Ben: That is so cool.

David: I feel like you got to do more than one.

Kevin: It's a good point.

Ben: You have one of the best stories at a party behind the statement like, oh, my wife and I met online.

Kevin: Definitely. It seems like it's easier these days. I didn't have any of the swiping stuff that was to date. Back in my day, it was a 24x24 icon on Twitter that we used for dating.

Ben: You had to upvote your future wife.

Kevin: Yeah, exactly.

David: Now the CryptoPunks make more sense.

Ben: That’s true.

David: Kevin Rose, thank you so much.

Kevin: Thank you, guys. Thanks for having me. This has been a blast. It's always fun to walk through the history of all this stuff and talk about the future. So, thank you.

Ben: Well listeners, thank you for joining us on that journey. It was so awesome to get to do this with Kevin. As you could tell, so much of David and my adolescent young adulthood was involved in things that Kevin has built. It’s super cool to get to do that with him.

David: Super cool.

Ben: I have one special carve-out for the end of this episode is a company that we at PSL ventures just invested in. We led a $5 million round in a company called TrovaTrip—speaking of—out of Portland. I am so pumped about this company. I just wanted to share a little bit because I think a) people should think about going on trips, but b) I think it's an incredibly cool company to work for if anybody's thinking about their next thing. Whether you're a software engineer, designer, or marketer.

What TrovaTrip does is enable creators to create custom trips to over 100 places around the world and take 8–16 people from their audience on a group trip together. So you're traveling with like-minded people to cool places with a person that you identify with—be it a yoga instructor, your favorite disc golfer, or someone else that you follow on Instagram, TikTok or anything like that. It's just a really cool upending of the group travel industry, and especially now when travel is actually starting to happen again. It seems like it's just great timing and a great team.

David: This is so cool. We totally need to get an Acquired trip. We've got to do all the Silicon Valley. Now, after this episode, we got to go find that bar on Divisadero in San Francisco where apparently everything went down in the Web 2.0 days. We can go to Stamford. We can go to the Old Crow in Palo Alto. Go to Buck’s in Woodside.

Ben: Actually, David, you and I, we almost went to Buck’s one time, right?

David: No, we did. Didn’t we?

Ben: We went to that spot next door. No, we looked in, it was full, and we ended up going to that other lunch place next door.

David: The Woodside bakery or whatever it is, yeah. We got to do it. We got to take you Buck’s. Buck’s is a crazy experience. This diner in Woodside, which is right next to Palo Alto, has all these crazy airplanes on the ceilings and all the old school like the Don Valentine era, and even a little later too. All the entrepreneurs and VCs would meet up there for breakfast.

Ben: It sounds like David is going to be our tour guide. This is great.

David: I’m going to love this.

Ben: Listeners, if you are curious to learn more, it's trovatrip.com. Click the link in the show notes or feel free to reach out to me in Slack or at acquiredfm@gmail.com if you're interested in the company in any way.

Join the Slack, acquired.fm/slack. Become an LP. We just dropped our nerdiest LP episode ever. We had Matt McBrady who has worked in presidential administrations for hedge funds, advising on monetary policy to basically walk us through the history of the Fed and the Fed’s role in our economy, and the difference between fiscal and monetary policy, and what the heck is quantitative easing. For such a hot button topic right now, it was great to get an expert two-hour chunk of information on what all these concepts are and how they interrelate.

David: Why does everybody try to interpret [...] every last word. Why doesn’t JP say what he means? There are reasons for this. So cool.

Ben: It was.

David: Also check out Modern Finance. It's seriously really good. I've listened to almost every episode. Like we talked about, the Beeple episode is so great. We’ll link to that in the show notes. Man, what a cool dude, and not what you would like to think on the surface. You got to listen to him. He's awesome.

Ben: Careful, you'll become an NFT believer.

David: Which is a good thing.

Ben: All right, listeners, we will see you next time.

David: We'll see you next time.

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