Rohit Krishnan — Investing in the Future

CAMERON WIESE: Welcome to the Build the Future podcast where we host conversations that promote positive and exciting visions of the future. Today we're talking with Rohit Krishnan, a venture capitalist and the writer of Strange Loops. Strange Loops is a weekly newsletter about Strange Loops on the systems underlying progress, innovation and the world of technology. And in the process of trying to create a philosophy of business. Let's jump right in.

CAMERON WIESE: What the process looks like on the day-to-day basis. So you're trying to think about, okay, what is the landscape of the future going to look like? What are the companies to invest in? How do you think about doing your research around that?

ROHIT KRISHNAN: The process of investing in some ways, like let's make a spectrum, right? There's a highly quantitative end of the spectrum where you try to get as many signals as possible analyze it compared to past data and see whether that predicts anything about the future. So it works really well with hedge funds. It works kind of okay with private equity companies. It works not that well when it comes down to venture, partly because there is not that much data and the risk is very high. So what you're trying to do is to hack that process. You're trying to come up with heuristics that kind of satisfy it without really having any hard data in your hand. For example, if I tell you, you know, FinTech is amazing and look, here's the data that proves FinTech is amazing, they have all the money that went into the sector, etc. You got to ask yourself, does that mean like I now need to look somewhere else? Because if it is that hot, then maybe, you know, the best companies might already have been funded or like the ROI might be declining over time.

ROHIT KRISHNAN: It's not a perfect metric, which is why it's a hard question. So to me, like it starts by trying to craft some ideas about what that heuristic actually looks like. So there are areas that I find personally interesting, exciting that I spend time on because I like it. You know, I'm an engineer and economist by background, right? So I could give you quantitative reasons why I'm excited about something. But I feel like that approach does not work in venture. Like you actually have to be excited about something. If you're not excited, you're not going to spend time on it. So open source is an area that I still find fascinating. Anything around the infrastructure software I find fascinating. I've recently started getting more interested in the medical slash materials side of things. I don't know if I'll end up investing in it, but I like it because I think it's a fascinating area that needs to get more capital behind it. So you have these heuristics, and these are areas that you find interesting. After that heuristic of the market,

ROHIT KRISHNAN: then is like, let's go find 10 companies and figure out who's interesting, right? Go talk to a bunch of them. And then it becomes much more like, do I like the founder? Are their numbers good? Are their metrics good? Does their product pass muster? Like it's a more understandable set of criteria that comes after it. If it's something like a SaaS company, it's super easy. If it's a lot of marketplace company, if it's something like, I don't know, like I invested in a company called Waha last year which does fitness devices. It's like mirror the US or like Peloton. It's slightly more complex because apart from Peloton, the metrics are not as well known, right? So you kind of have to construct yourself. But like the process is similar. So I don't know whether I answered what does your day look like very well, but like that's at least how I make up my mind.

SPEAKER UNCLEAR: And this kind of flows through your whole life. One of the trends that seems to be going on is

CAMERON WIESE: this shift from venture capital is kind of turning into private equity because there's so much data available around like SaaS companies, marketplace companies. And so there's not as much of that true. Like you have to make a gut decision. Like you would have, you know, 10 years ago, right? When people were like, we're going to invest in Uber, Airbnb. It's like, these guys are crazy. But now it's like, oh, you have your products in the market. You're growing this rate. You have this, like there's, there's a lot more signal to pull from. It's just an interesting trend line. I'm excited to see that capital and those returns,

SPEAKER UNCLEAR: then hopefully shift to more of the gut-based investing once again.

ROHIT KRISHNAN: I mean, look, venture capital as an industry itself is maturing. If you looked at software companies 10 years ago versus software companies today, they don't look very similar. I mean, kind of do, but they work very differently. The speed is much higher, repeatability is much higher. It's just the same adventure. One of the ideas that I'm personally super excited about is how Tiger and Insight partners have kind of copied the Y Combinator model and applied it to Late Stage Venture because they just said, we are not going to actively try and find who's going to be the next Coinbase or Stripe. We're going to find out who are the duds and kick them out and then buy the index. So that's why they get to deploy like $7 billion in a quarter and then you get results that are according to it. So in some ways, as industries mature, you're going to get more systematization and systematization means you're going to take less risks. But I'll point out in that same timeframe, and this has happened, there was also funding of companies like BioNTech, right?

ROHIT KRISHNAN: I mean, on the medical side, there was this funding of companies like Commonwealth Fusion. There's been a crazy boom in space, which still strikes me as slightly absurd, but it's true and it's like highly productive, you know, Varda and so on. There's been a massive boom in crypto, which regardless of your opinion about crypto has been, it is an out there technology because even today, like nobody agrees whether it has value or not. So what I'm saying is that it's slightly more nuanced, right? I mean, there'll always be cowboys who kind of go off and invest in like crazy shit and some of them will be successful, but like not all of them, obviously. How do you view the crypto landscape right now? Time to get strong opinions, huh? Yeah, let's do it. So I'm a big fan of it with caveats. So I'm a fan of it, number one, for a philosophical reason, in the sense that there needs to be way more experimentation generally. And crypto as a sort of fundamental technology base leads to way more experimentation in terms of sort of where firms are set up, where incentives are set up,

ROHIT KRISHNAN: where employees are paid, where the stakeholders are getting remunerated, et cetera, that I think fundamentally it's great that we are getting that oxygen. Not all of it will succeed, et cetera, et cetera, because early financialization is not that great, I feel, generally speaking, for early stage technologies. If you tell me there's a way for you to make money off of TCP, IP in the early days of the internet, and because you can create a market and trade it, I'm not entirely sure whether that's a good thing. But I love the fact that there's experimentation here because without having experimentation, you're not really going to be able to get crazy results. So that's, I guess, my philosophical liking for the space number one. Philosophical liking for the space number two is that in big financial services industry, if you've ever looked at any company trying to disrupt any part of this ecosystem, you would have looked at the incumbents and kind of gotten freaked out at how ossified and crazy complicated it is. I worked at it when I was at McKinsey, I served a

ROHIT KRISHNAN: bunch of these banks and insurance companies and now I sit on the board of InsurTechs and look at fintechs, we're trying to disrupt them. Man, it's complicated. Because it's like 40 years of patches over patches over patches. So it's like, if you look at a tech stack, it has that's COBOL from 40 years ago, all the way up to whatever the latest thing is that some developer threw it. So the problem with that is that if you want to disrupt that industry in any meaningful sense, you need to build a new stack. And crypto gives you that new stack that allows a bunch of systems to actually talk to each other, which I don't think I have seen very often. Like APIs started to get there, but crypto gives a real incentive for cross-chain communication. And that I think is fascinating. And that's also the only way that you're realistically going to be able to take costs out of the system, because the number of friction points is so high. So with both of that, I am excited about it. I'd love to see where it goes. I think we are so early in the space that predictions are kind of crazy.

ROHIT KRISHNAN: Like 90% of the problem I have with crypto is that the people who are pro crypto are are so vociferous about it, yet not that right about it. Like they talk about monetary economics and nobody needs to know everything about technology and cryptography and software and economics. Like that Venn diagram is like a handful of people in the world, which is okay, right? But so you don't need to make an economic argument about how a deflationary asset is the right thing for you to go after in the world when you don't really understand it all that well. Like it's not that long ago that we had a depletionary asset or at least we were back to the gold standard and it wasn't sort of, I mean, we went off it for a very, very good reason. So I feel like that argumentation substantially weakens the argument for crypto. And similarly, the whole pump and dump stuff where any new coin that comes up gets pumped up. And that's because it's like you've suddenly made an invisible tech asset into a financial asset. And if when you do

ROHIT KRISHNAN: that you're going to get these bumps and dumps. I mean, that's the main reason I said like, if you had a TCP IP coin, I'm not sure it would have been great for the internet necessarily. It's not a

SPEAKER UNCLEAR: fate of complete, right? You can't bank on it. The political philosophy underlying the space

CAMERON WIESE: is fascinating too, because it enables like new organizations to be built, especially in contrast with like the ossified existing institutions. And that's what's really exciting,

SPEAKER UNCLEAR: at least to me, is the ability to like, we build new things. Yeah.

ROHIT KRISHNAN: No, I agree. Like I said, in the beginning, right, I think if you look at, if you look at existing organizational structures, there's a few for profit structures, all of whom basically look roughly the same. I think the biggest change, or biggest arguments about for profit structures revolve around some combination of, you know, dual class shareholder holding today, or like, if you go a few years back, there was a big argument about, should you be a conglomerate or not? You know, These are important discussions, but these are hardly the parameters of, you can argue about so much more. Right. So ultimately, one of the things, I mean, it's slightly parenthetical, but one of the things I find fascinating is that a lot of the crypto based decentralized governance based organizations resemble cooperatives that have existed for a long time in different parts of the world. And I just find that battle fascinating because, you know, we are almost creating a new way to serve like a business economic model that is really tiny and exists in different parts of the world.

ROHIT KRISHNAN: So let's see how it comes up. But I think there needs to be way more experimentation on organizational setups because everybody just chooses one of two ways and just goes with it.

CAMERON WIESE: And then the ideas can battle themselves out like in the market. And then it's like, oh, we have a ton of other options. One thing that I've been keen on is the whole decentralized autonomous organization that Dow space is still pretty early, but the possibility for people to crowdfund things that they believe in. For example, no big organization wants to fund a nuclear power plant because the return timelines are so long, it doesn't match up with their incentives they have to follow with their shareholders. But you could have 100,000 people who care about that source of energy. Like, oh, I'll put this into a Dow and let this thing ride out for 20 years. then it gets funded and people aren't doing it, they're doing it for like some percentage of like a return, but not like enormous quarter by quarter. And that's something that hasn't existed before. Now like the hand, like the ability to kind of like organize and fund things through the public sphere

SPEAKER UNCLEAR: is now possible using this technology

SPEAKER UNCLEAR: that when it wasn't before.

ROHIT KRISHNAN: I think like that has profound implications

SPEAKER UNCLEAR: if we play this thing out. No, indeed.

ROHIT KRISHNAN: I mean, one way to double click on that is just look at, I mean, Kickstarter is not that old is one way I would say it. So crowdfunding in itself is ridiculously early and the Kickstarter with equity type companies are even younger and none of them are large. So like, that's what I kind of mean when I say also like, I mean, I agree with you, right? There's man, there's so much stuff that we can try out and to be done here. And I'm just glad that there's experimentation going on because I think that's hypercritical for anything that we want to do in the future. I mean, solving coordination problems at scale is kind of behind, I don't know, like most of the

SPEAKER UNCLEAR: world's problems it seems like. It's like coordination and communication seem to be the two things.

CAMERON WIESE: I'd be curious, when you look ahead, call it like 10, 20 years from now, like, what are you most excited about the world looking like? You know, blank canvas, like, what should we be doing? How should we be operating? What sort of things should we, should exist that don't currently

SPEAKER UNCLEAR: exist but that you would like to see. I've talked about it a little bit and I've written

ROHIT KRISHNAN: it about it a little bit as well. I think, I mean, we've touched upon the coordination and communications problems a little bit. To me, that is indicative of the fact that as the complexity and the interconnectiveness within the world increases and the number of stuff, the sheer scale increases, these problems become exponentially harder. I mean, it's kind of a problem at scale. There are areas where we are kind of working a little bit that I would like us to put more effort into on the margin. So for example, things on energy, whether it's with respect to fusion, etc., I think I would like us to spend more effort and money into those segments that I think are important. Similarly, there are areas around material science where I feel like we spend far too little energy because one of the areas that I'm reading up on and researching into at the moment is nanotechnology. And it has blown me away how much it has already transformed the world without kind of anybody knowing about it. Like half the medicinal stuff that you read

ROHIT KRISHNAN: up on is influenced by nanotech. Anytime you have ills and adhesive in your burn victims, it's influenced by nanotech because it has this crazy application into medicine that hasn't really come out into the public consciousness. So there's a bunch of work that is going on that I would like to see more of. But I think when we kind of push forward into, you asked about 20 years. I think one of the things we still don't do very well is extract information from individual domains or individual subspecialties, individual sectors, individual investors, individual scientists, and have better forums or more forums for that to be discussed within the wider space. Like interdisciplinary research, I think many places have tried it with varying degrees of success, like whatever, Santa Fe Institute, et cetera, et cetera. But there's still few and far between, I feel like. I don't feel like we do enough of that to kind of encourage multiple people to look at the same problem from multiple angles. I feel like that's something I would love to see more of in the next sort of 20 years.

SPEAKER UNCLEAR: Everyone seems to be operating in their own little silos around like, oh, at this

CAMERON WIESE: university, we're doing or trying to solve this from a biology lens versus like, you physics department like across the country could be trying to solve the same thing, but those nodes aren't talking to each other.

ROHIT KRISHNAN: Exactly. I mean, one of my ideas, at least, is that if I look at the evolution of progress, GDP, industrial revolution, call it what you will, you often see the same themes are occurring. I mean, if you look at a bunch of the milestones along the way, starting with steam engine and going all the way to the transistor, and it's some combination of, of you have fundamental advances in energy where you find new sources of energy and you can capture and utilize them effectively. There's fundamental advances in material science where you can capture and advance, create new types of materials that are better or more usable. There's fundamental advances in knowledge. I mean, this can be fundamental knowledge like Einstein discovering the general theory of relativity or it can be more specialized forms of knowledge. And somebody needs to sort of combine these things together in order to truly create the next giant S curve. And in order to combine things together, normally you see this happen in like small clusters, whether it's places like Bloomsbury Group in London,

ROHIT KRISHNAN: or whether it's like Silicon Valley, where everybody kind of came together. Like you have these clusters where different ideas can kind of ping off of each other and entirely new types of industries or entirely new types of scenes can form. I'd love to see more of that. That's an interesting way to kind of frame Silicon Valley.

CAMERON WIESE: I mean, because it truly is, was, is, was, is, it's a time melting pot of like different perspectives and people were able to like have conversations like this, be like, oh, energy, oh, material science, oh, okay, maybe like those things are affected.

SPEAKER UNCLEAR: Oh, let's go do some more research.

SPEAKER UNCLEAR: Yeah, exactly right.

ROHIT KRISHNAN: I mean, for a long period of time, Silicon Valley used to be all about software for obvious reasons. I mean, it's easier to scale, et cetera, et cetera. But recently, I don't want to say there's been a shift, but at least there's been a clear understanding that you can build big companies with hardware. I mean, start with kind of, I mean, Lidar, Doom, etc. Which in some ways is a throwback to the original, the silicon pod of Silicon Valley, which is useful because I don't know whether there is a fair child somewhere or like an Intel somewhere, but it's at least interesting to see that once that software has advanced enough, you can now use the software to do things like simulation which allows Musk, when he wants to build this rocket, he can do the simulations and kind of make it better, which is not something he could have done 20, 30, 40 years ago, because you just didn't have the computational power to actually try those things out, but now he can. So these things actually relate a lot to each other, which is why I feel like the interstitials

ROHIT KRISHNAN: where one meets the other are the truly interesting areas. And I feel, I don't know, the world would be better if these people actually talk to

SPEAKER UNCLEAR: each other.

CAMERON WIESE: Well, here's the other thing. I mean, we also have the communication mechanisms now that we didn't have even 10 years ago. And so it's like, I think to your point, like these people need to be communicating. 10 years ago, we didn't really have the tools for them to do so.

SPEAKER UNCLEAR: Now those tools exist. And so it's just like someone needs to come in and help facilitate that conversation.

ROHIT KRISHNAN: Kevin Kelly had this thing about scenes, right? Or scene-y us where he kind of said there exists certain a geographical place at that point in time, but I don't know that it necessarily needs to be a geographical place. It can be distributed, but at least a place where enough different types of people can come together, and their ability to be in that place is what enables them to kind of tap into their innate genius and actually makes each other better. It feels like the kind of thing that we should actually be seeing more of, or at least we should be attempting to create more of, and it's fine, slim like we see, right? It's fine if 15 of the 20 fail, like you just need to have a couple of successes for it to have an outrageous benefit for all of humanity. This is kind of where we start to blend into like the charter cities movement where people are trying to aggregate their communities, people who share values online, and then use that as leverage to all move to one city or one location. Like Miami is an example of this.

ROHIT KRISHNAN: I'm not a huge fan of Miami personally, but I understand that the impetus for more people to move there. And I am 100% behind the creation of more hubs, because in general, like with everything, having more hubs is better, because then you can choose, which is kind of the whole point, right? And the shelling point will get created somewhere where you kind of make a decision based the basis of X versus Y. And you at least in, you know, the pessimistic view is that today, if you move to Miami or Silicon Valley, you can get a choose. You want to go for wildfires or hurricanes, but at least it's a choice. And each place will get specialized over a period of time, like any of these things. Agglomeration economics tells us you will find clusters, and your clusters will get created where each cluster is better for x versus y, which is OK. But you still need to encourage the development of a whole bunch more clusters, because otherwise, it's no longer like, otherwise you're not really going to be able to see enough breakthrough ideas come out of that individual cluster.

ROHIT KRISHNAN: I think that's kind of the problem. I mean, you know, I guess you can kind of start to solve it a little bit top down, but a lot of this has to be, to our point, like a bit of a bottom up movement,

SPEAKER UNCLEAR: like you kind of, you have to want to move to a place, you know? Yeah, yeah. I want to, I want to

CAMERON WIESE: kind of have you kind of pick on the, the nano tech stuff, like, so, so what have you been diving into there? What's been like, like, what's been really interesting about that space? We connected over the where's my flying car, review you wrote, nanotech was a huge theme in there, seems to be kind of capped by our inability to figure out the energy problem, which is, you know,

ROHIT KRISHNAN: different discussion, but it kind of started a little bit with that book. I mean, the book is, obviously, it's fascinating, right? I mean, it's a, it's like a sort of, yeah, it is difficult to find a truly utopian book that kind of talks about a variety of themes like in general, but especially these days, that is not just Babylon. That's just not regurgitating stale talking points about, you know, the future would be amazing. So I feel like, despite there being an actual, supposedly there's an actual journal of futurism, etc, but like a lot of it seems fairly negative for better or for worse. So that's the already I liked it. And obviously, he, Josh, speaks quite a lot about nanotech in that book. So I was like, I mean, he's clearly talking this much about it. And there seems to be a fair amount of progress. And why don't I? Why don't I know about this? Why isn't everybody talking about it? So I started reading up a little bit, like the different types of techniques and functions that came up because I was also reading about like, what else has happened

ROHIT KRISHNAN: in the world of material science that we just don't understand or know about, right? Because like we know a little bit about like the benefit of creating steel several years ago, aluminum due to the new process, but we don't know much about what's happening today. So I was reading up one of the successes in this area, I think I'm pretty sure it's a success. I'm in the middle of reading up a little bit on it as, you know, Bill Clinton signed an agency into being, I want to say like 20 years ago, almost more than 20 years ago, called the National nanotechnology initiative. I mean, it's been bipartisan, every successful administration has pretty much increased funding or helped them. And these guys, they don't necessarily do a lot of the stuff just themselves, but they act as a conduit to kind of pass or like bring together the various nanotechnology initiatives that are happening in multiple different parts of the federal research ecosystem into like sort of some sort of a centralized core, which is on already, it's

ROHIT KRISHNAN: very interesting, right? Because they want to kind of look at a wide array of fields all the way from medicine to sort of physics, chemistry, biology, engineering, electronics, you name it. So I started looking at like what kind of stuff have they been doing and, you know, what kind of, I don't know, like how do they do it, et cetera. Now, the first thing I noticed is like their budget is tiny. They get about a billion and a half a year, which is, I mean, if you, like, if you look at the federal budgets, billion and a half is nothing, man.

SPEAKER UNCLEAR: Dropping the bucket. Exactly.

ROHIT KRISHNAN: But even with that, I mean, they're still seeing like a whole bunch of stuff that they've created. I mean, there's a few others that have come together afterwards, like they eliminated, at least from the recent budget supplement, I remember they eliminated HIV-1 DNA from the genome of some living animals from a modified drug, antiretroviral drug. They created quantum devices. They looked at the designing vaccines for cancer is something that they actually work on on the immunotherapies. I think that's one that I think the DOD works with NIH or some somebody else. They look at the thermodynamics for specific pieces of DNA creation, how to create the folds, etc. So they create nanosensors that can potentially be useful to help with the diagnostic side of whole list of diseases. I mean, there's also a list, right? I mean, they kind of figure out a way to create better batteries. They're looking at things like if you manage to create some of these you can put them into textiles, concrete, etc. So the more I read on it, it's a little bit like,

ROHIT KRISHNAN: it's become some version of a general purpose technology that is now embedded everywhere to the point that it's become invisible. So reminds me a little bit of, you know, Mrs. Robinson movie, right? Where they kind of talk about plastics, plastics is the future. And like, we don't even think about plastics anymore because it's just kind of embedded in everything that we do. So it's gone away from the forefront and it's become something that is embedded in pretty much any technology that we kind of use. So I feel like a lot of it is still in the research space and a large percentage of this presumably are not really going to actually show up in real life data anytime soon. I would imagine, I mean, the positive scenarios that it might, but like the fact that even on a research setting you're able to get some of these results is I think very fascinating. I think that's the exciting part about it because it feels like you need for a relatively small budget, if you're able to get pretty great research outcomes, then there is more and more commercialization that can be done from

ROHIT KRISHNAN: it. And that feels like an area that I think hopefully should come into resurgence at some point in the next few years. I think there's a national nanotechnology entrepreneurship something. I forget the exact name. I think it's like an entrepreneurship network, I think, which has, I mean, a characteristically horrible website, as you would imagine from a government service. And I looked at that and I went like, I mean, did these guys make it in like 98? I don't get it. I mean, surely, like, why is this not more exciting? Why is Mark Andreessen not all on top of this?

CAMERON WIESE: That's the thing. It seems to be this huge potential to groundbreaking like the next S-curve technology. It's like kind of tucked away in like a federal research lab. Some people know about it, but I think Josh and then Drexler and you have who's the other Ralph Merkle. There are only like five to 10 people who have actually done any public like real deep thinking in this space. It just seems like everyone's just glossing over this. It's like, are we missing something?

ROHIT KRISHNAN: I feel like there's the normal hype cycle stuff, which I'm sure plays an important part here as well. But I think part of it is also, like I felt the same way when I read a little bit about the Fusion technology, right? The fact that there are Fusion startups that have demonstrated success, even if in a small scale, it's pretty impressive. Because I remember when I was growing up, Fusion was a technology that never came, right? Like, you know, with talk-and-ack reactors, and like these things would never work. It's always 25 years away, and there's a series of jokes about it. So I felt like, okay, so clearly somebody's making it work. And I know funding is not an indicator of success, but like a couple of them have raised like a hundred, $200 million, and they're trying to kind of actually scale it up. Now it might still die for a whole list of political considerations, or even technological considerations, but the fact that there has been effort put behind it and demonstrated successes in a small scale leads me to believe that even if none of these companies

ROHIT KRISHNAN: succeed in the next five years, there's at least gonna be somebody who is gonna succeed in the next 10 years or 20 years, because that's how everything has worked. I mean, AI companies failed miserably in the whatever, eighties and after the winter, it's come back because you can now actually, You know, you now have the chips to put them up.

CAMERON WIESE: Well, you pair that with like the funding ecosystem and people are are much more willing to make up, like invest these sorts of things. Like boom, supersonic, like private investment, like that wouldn't be possible 10 years ago. It's like these these things that that hold promise have just been ignored for perhaps political or, you know, capitalization reasons are now coming back from the limelight. You're like, oh, there's something huge here. This could fundamentally shift the way people travel or people live or that we build things. Let's get this thing up and running. And so the nanotechnology component of the future is probably one of the most like forwarding frontiers or like one of the most out there frontiers, that's still practical, that people have not like been pulled into yet.

ROHIT KRISHNAN: Yeah, I mean, there's a little bit of like fetishization of what has already worked in technology to some extent. I mean, we are living through an era of software where we think of Apple as a hardware company, but what they create is beautiful and pretty great, but it's not exactly groundbreaking, at least not in the sense that you would think of a fusion reactor or a nano medicine provider as groundbreaking. I mean, the best thing to come out of Apple in terms of groundbreaking is their M1 chip. I mean, it's pretty amazing, but I don't think it's the same leap as when Intel unveiled their first chip. So we are making strides in making things more efficient, effective, which is what you would expect from a large successful company, because I wouldn't expect them to be coming up with the next great innovation that sort of shocks the world, even though maybe they should. Yeah, I mean, this is kind of the standard cycle of innovation, right? You have the people on the frontier and they're like, oh, cool, build this thing, and they become the incumbents.

ROHIT KRISHNAN: then it's like, okay, cool, it's the next day and someone else has to come in and do it because they

SPEAKER UNCLEAR: just can't move the ship fast enough. Financially, I guess it makes sense. I mean, Tim Cook has been

ROHIT KRISHNAN: at the helm of Apple now for close to a decade or maybe slightly lesser and I think under his watch Apple has 6X hits. Market cap, I think they went from like 300 billion or so when Steve Jobs handed over to him to now like 2 trillion, which is an incredible meteoric rise that just cannot be underscored more highly. So he's done his job really, really, really well. It's just that his

SPEAKER UNCLEAR: job didn't require him to reinvent the wheel, which is the latest. I think that Tim Cook thing,

CAMERON WIESE: he's been able to ride the co-waves of like Jobs Vision and just like continue to squeeze, like make it more and more efficient because Jobs died in 2011. The iPhone was out for like two years. It was only on like singular wireless. It was like on singular before AT&T bought them. Like That was one network rollout in 2008. There's no copy and paste.

ROHIT KRISHNAN: I think that's kind of riding the normal S-curve that you would expect from an industry where technology is kind of, I don't want to say mature, but at least understood. So they can kind of pass the next one on and kind of go on with the commercialization part of it. And, you know, full credit, right? I am in no way saying that is a lesser accomplishment in any sense. It is a tremendously hard thing to do, but it is a different thing.

SPEAKER UNCLEAR: And that's okay. I mean, that's just kind of the way

ROHIT KRISHNAN: I mean, people still say Steve Jobs was not an innovator because he sort of focused primarily on the design aspect of things. And I think that's a different way to innovate, that's all. I mean, you can kind of take your pick, right? It's like there's fundamental technical innovation that happens oftentimes in laboratories and places like that, but somebody needs to take that and actually commercialize it for the world where more people can actually use it. And that transition is not always easy to do, except for maybe pharma and medicine. We see that in pretty much every sector that somebody needs to actually make that work, right? Because otherwise you just aren't going to be able to do it.

SPEAKER UNCLEAR: And then I think that on like the pharma and medicine side,

CAMERON WIESE: like there's so much more innovation that like could be unlocked there, but it's like cost prohibitive. And just to kind of tie back to like a broader theme here, which is the computing power is driving down the cost of a lot of these things and giving people the ability to do like alpha fold.

SPEAKER UNCLEAR: Yeah. What? Yeah. Crazy, amazing.

CAMERON WIESE: and the drugs are going to be developed based on that research being public and accessible.

SPEAKER UNCLEAR: It's going to be wild. And that wouldn't have been possible.

ROHIT KRISHNAN: Yeah, I looked at this recently, I think last week. I mean, on the one hand, there's a little bit of, there's an accounting question here to some extent, in the sense that I think the normal argument is something like, to get a successful drug through, it's cost whatever, a billion and a half dollars. and that sounds absurd, right? I mean, it sounds crazy. But then what that actually tells you is less about the cost to get a drug through and the probability of getting a drug through the pipeline. So there are kind of two, there's two factors here. I mean, factor one is that, like, you actually do the R&D to develop a drug and push it through the three clinical trial phases, kind of takes X amount of money. But that's actually not the lion's share, right? The lion's share is actually the fact that you need to do 10 of them, because nine will die. So it's a little bit like you look at the venture capital investors portfolio and look at like, oh, you know, how much money did you make on Facebook and divide that by like every other investment that you did.

ROHIT KRISHNAN: So in some ways, like, you're like the billion and a half loom so high in the public's mind, but it's not apples to apples comparison. In some ways, I feel part of it is just that like, because there are so few pharma companies, they're accounting work like this for obvious reasons, because it is cost, right? But if instead of 20 pharma companies, if there were 200 pharma companies, the market should solve this out a little bit better. I guess that's point one. Point two is that the probability of getting a successful drug through has been dropping over a period of time. And that's just kind of a fact. And that tells us a little bit like our ability to identify new drugs that gets through is not, I mean, has been dropping. And there are very, very good reasons why that might be the case above and beyond the usual organizational ossification cases. I mean, there's like actual scientific reasons why this might be the case. The interesting thing about things like alpha-hole is like that actually potentially brings back the ability to get a

ROHIT KRISHNAN: higher throughput because you can now simulate a bunch of stuff that you couldn't do before. So like I think what I'm most intrigued by with these things is like now they might bring back the ability for us to now pre-screen a bunch of drugs and say these things are just never going to work because now we can simulate them and test them. Whereas before the only way to do that is to actually do three clinical trials and just see if it works. I mean, it's hard. I mean, it's like if you and I came up with an idea for a company today, shooting down that idea is going to be not that easy. There's arguments to be made on both sides. Pretty much the only way to do it is to actually build it and see if it works. Whereas it's the same thing in like, far more to a large extent where you have to actually build it and see if it works. Instead of actually building it in real life in bits, sorry in atoms, if you can build it in bits, you unlock a whole new sort of era of efficiency. I don't think it's going to be that widespread that quickly

ROHIT KRISHNAN: because none of these things get commercialized that fast, but like even the possibility that this can actually, even if it changes marginally, You take like one drug out of 10 that suddenly increases your efficiency by like a crazy percentage. It's interesting to think about the implications of being able to do all of the trial work and the simulation beforehand, right? Yes. I mean, anything that gets you to a point where you can rule things out faster is probably going to be helpful. Even if you don't manage to get to the point of ruling things in, right? I mean, this is my like positive selection versus negative selection. Positive would be you say, I'm going to identify the drug that is going to treat breast cancer really, really fast. And that's just a hard problem to crack. But instead of that, if you're able to even identify a drug that like this will not treat drug cancer, breast cancer, so I don't actually need to test it by going through the clinical trials. That's already hugely helpful. So we might get there in fits and starts, but I'm pretty optimistic about our ability

ROHIT KRISHNAN: to at least start doing more of this on the margin.

CAMERON WIESE: Just to kind of close on that, there's a couple companies like Octant Bio where they're doing targeted drug therapy. And when we can start to pinpoint the specific pathways and channels like certain drugs affect, you pair that with you, but it simulate how they operate. It's like, cool, the personalized medicine, like how your body would respond to, like your body has something that needs to be brought off, like, cool drugs can be specifically like created to enable your body and like your hormone levels and you know, whatever else like what your current state is, like use those resources and fight the thing. And then because we can model it out, it's like, oh, this actually isn't gonna affect any of your other systems like, cool, we're good to go. And then that just like clears out this whole craft of like, every drug has to be safe for everybody. And so like, oh, if

SPEAKER UNCLEAR: we personalize these,

ROHIT KRISHNAN: I think this is one of those cases where, to bring back one of our earlier points, where getting better in software, getting better in bits, enables us to get better in atoms, and it kind of creates a little bit of benefit coming from one domain that you can now apply to another, right? I mean, the fact that our ability to simulate better or our ability to run better sorts of analysis enables us to create better drugs that are now going to be able to increasingly affect us. So whether that is because we are now able to discover specific pathways and kind of create targeted therapies, either because we have technologies like CRISPR that enables us to play with the genome slightly better, or it's because we have technologies like AlphaFold that enables us to simulate that better, the end result is that you're now going to be able to create a drug that is sort of cheaper, faster, speedier, route to market. I mean, you're already seeing some of this with the mRNA vaccine, right? I mean, like, because you can now create a new vaccine in sort of a record time effectively.

ROHIT KRISHNAN: And because it's not like an attenuated virus, like it's much easier, much simpler for you to actually create it, even if in lab, and you can kind of mass produce it, mass manufacture it, I'm going to take it to market. It's a little bit of a step change, at least in so far as specific diseases are concerned. And I think we should hope that it generalizes over a period of time. I think so. I'm hopeful that, you know, given that there's enough interest and like enough of a demand to like make these systems better, like we need to do these things.

CAMERON WIESE: Anything you want to plug? Substack, Twitter, where can people find you?

ROHIT KRISHNAN: Sure. People can find me on Twitter. I do write weekly on substack at Strangeloop Cannon. So say hi.

CAMERON WIESE: Thanks for joining us for another episode of the Build the Future podcast. If you want to support the show, please share your favorite episode with a friend. If you want to get updates on the events we're hosting, new podcast episodes, and follow along as we build the new World's Fair, you can follow me on Twitter at CAMWIESE. Until next time, go build.

SPEAKER UNCLEAR: you