Sam Altman on start-up talent

I look for founders who are scrappy and formidable at the same time (a rarer combination than it sounds); mission-oriented, obsessed with their companies, relentless, and determined; extremely smart (necessary but certainly not sufficient); decisive, fast-moving, and willful; courageous, high-conviction, and willing to be misunderstood; strong communicators and infectious evangelists; and capable of becoming tough and ambitious.

Some of these characteristics seem to be easier to change than others; for example, I have noticed that people can become much tougher and more ambitious rapidly, but people tend to be either slow movers or fast movers and that seems harder to change. Being a fast mover is a big thing; a somewhat trivial example is that I have almost never made money investing in founders who do not respond quickly to important emails.

Also, it sounds obvious, but the successful founders I’ve funded believe they are eventually certain to be successful.

Here is the full blog post — agree or disagree?

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Ethical is clearly not a prerequisite.

He also never once mentions diversity either.

The fact that he fails to mention both speaks volumes....

Why would diversity even enter into the discussion?

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Sounds like Steve Jobs is the template and yes he wasn’t totally ethical

Compared to his rival Gates, Jobs was a veritable saint.

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Sam Altman is not a blithering idiot.

He flipped a couple phone apps that soon got shut down after acquisition and then warmed a chair at YCombinator well after its winning bets. I am mystified as to why I know who this guy is.

altman is a politician disguised as a tech guy

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A rarefied set of skills indeed. Reminds me of the lists of women in their 30s.

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"Also, it sounds obvious, but the successful founders I’ve funded believe they are eventually certain to be successful."

Does he mention what percentage of failed founders believe they are certain to be successful? What is the best way to tell rational self confidence apart from delusional overconfidence? (Perhaps high confidence is another necessary but not sufficient quality?)

The fact that I ask these types of questions probably means I'd never be a successful founder.

Pipsterate said "What is the best way to tell rational self confidence apart from delusional overconfidence?"

The reality is that every single start-up business goes through multiple phases where it just doesn't make rational sense to keep going, but people that believe that Karma/Universe/God/Whatever have deemed these people to be leaders will still invest the time/effort/money/risk to keep going. It's that tenacity to fight like you are going to win when it doesn't make sense to keep fighting that Sam is talking about. That's what makes entrepreneurs crazy. Interestingly, I find this best communicated in a Batman movie, The Dark Knight Rises. If you try to jump across the gap with a rope around your waist, you will never make it.

If it didn't require irrationality to be an entrepreneur, we would all be one, because the reward of winning is pretty sweet.

In "Thinking Fast and Slow," Kahneman said optimism was the main differentiator between entrepreneurs and everyone else.

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"agree or disagree" TC resorting to cheap attention seeking tactics

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oh, is that all?

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From the essay: "It’s a nice tailwind if you can get yourself to the place where simply taking your money helps a company get taken more seriously." Altman is honest. Tech is hype, and hype is the key to an increasing valuation and what's considered success. Yesterday Cowen linked to his most recent essay at Bloomberg on the subject of wage stagnation. In the essay Cowen does not mention investment in productive capital or the depressed level of investment in productive capital, nor does he mention that the Trump tax cut, sold on the promise that it would unleash enormous investment in productive capital, hasn't. He isn't alone. Gregory Mankiw did not mention productive capital in a recent interview by Bill Kristol on the same subject (wage stagnation). How does one talk about stagnant wages without considering productivity, and how does one talk about productivity without considering investment in productive capital. Altman has experienced great success by investing in the usual suspects in tech. He also has invested in and is the chairman of two nuclear energy companies. That's a departure. But these companies don't intend to actually produce nuclear power, they intend to license the technology and collect royalties. That's not to diminish the effort but to emphasize the point that tech rarely if ever invests in productive capital. If one is expecting tech to produce rising wages, one will be disappointed. Rising valuations of tech startups perhaps, but not rising wages.

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Why are we allowing those sociopaths to trash our country?

Because serving previously unserved customers is one of the highest ethical goals of modern America?

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I agree with this as a description of the necessary conditions for a founder who is the leader and face of the company. I think that technical and creative genius is a separate requirement that doesn't always manifest in the same individual, but can't be just hired, and should be part of the thing organically from the beginning (e.g. Woz).

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Here's an interesting list: the 30 worst (most dangerous, or evil) tech companies: https://slate.com/technology/2020/01/evil-list-tech-companies-dangerous-amazon-facebook-google-palantir.html

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This may be true of 'go big and/or go bust' VC-driven tech startup business, but most of the economy consists of companies that followed a pattern of organic growth over years or decades. Those founders may have had no idea how big their businesses would become when they started them. For example, Sam Walton operated his single 'Five and Dime' store in Bentonville, Arkansas for twelve years before opening another location and starting the Walmart chain (which then remained an Arkansas-only business for another six years). The hyper-aggressive, VC-driven Silicon Valley tech model isn't the only model for successful entrepreneurship. It's not even the only model for tech-startups.

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I'm tempted to lower the status I accord to VC people because so much of what they say seems to be TED talk nonsense, but at the end of the day there's something very respectable about the fact that they put their money where their mouth is, which can't be said of most bloviators.

Their money?

Well, they do reap their money by using other people's money, which is a true art form. Especially when being able to use lower tax rates for their own winning bets, ala Romney.

All of that is true, if they are successful or lucky in their investments (and even better each fund is separate, so they only need it in one fund).

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Probably based on wild opinion and unfounded by data--his comment: "I have almost never made money investing in founders who do not respond quickly to important emails."

Definitely know some dangerous people who respond unbelievably quickly to emails. Would not trust them with a dime.

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If start-up investments only make money X per cent of the time, then the characteristics of the winners are poor predictors generally, for low values of X.

+1 My firm has invested in over 1000 very early stage startups over the last 8 years. We put a lot of work into trying to assess and track them.

With a sample this large, it's pretty easy for us to identify lots of examples where founders have the opposite characteristics and identical outcomes--both positive and negative--even controlling for the timing and subsectors of their startups.

Not to mention the well documented evidence that interviewing in general is a terrible predictor of job performance. On first principles, where the job is as ill defined as "startup founder, I would expect it to be even worse.

Tversky was one of my professors in grad school and we see a lot of investors following the classically documented pattern of jumping to conclusions in a low validity decision environment due to the standard cognitive biases.

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Lists like this are mostly useless and usually seem to reflect the habits of the author. That is, a projection. Sam Altman, for example, I'm going to guess, probably responds to emails quickly and finds this virtuous in founders. On the other hand, it seems just as likely that responding to emails so quickly in this way, can represent a founder that doesn't know how to prioritize--is simply constantly reacting to things pushed his or her way. Tony Hseih founder of Zappos famously promotes NOT responding to emails the first day unless it is absolutely urgent. This seems more correct for me, but that's probably because that's what I do. Point is, different systems work for different people, especially when it is so closely tied to one's personal workflow.

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Oh and white, and male. Same as mostly forever.

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