Generated Transcript

[00:00:15] Howard Hartenbaum
Hello and welcome to VentureCast.

[00:00:17] David Hornik
I’m David Hornik and this is Howard Hartenbaum.

[00:00:20] Howard Hartenbaum
And this is Venturecast. July Something Edition.

[00:00:24] David Hornik
July 6th, my younger daughter’s birthday. Whoops.

[00:00:29] Howard Hartenbaum
Is that right? So let me understand this. It’s her birthday and you’re putting her on a plane to camp?

[00:00:36] David Hornik
She’s going off to summer camp. And I was supposed to get her an ipod touch before she left, but.

[00:00:41] Howard Hartenbaum
Anyway, that’s what she wanted for her birthday.

[00:00:44] David Hornik
Yep. She’s 11.

[00:00:47] Howard Hartenbaum
That’s a good present. But it’s kind of. Is that a reasonable present to get an 11 year old?

[00:00:51] David Hornik
I think it’s ridiculously expensive, but it’s what she wants and I spoil my children.

[00:00:55] Howard Hartenbaum
Me too.

[00:00:57] David Hornik
Can’t help myself.

[00:00:58] Howard Hartenbaum
It’s almost my 12 year old’s birthday and he wants, and he needs an, he does need a guitar amp. There’s no question. Like his guitar amp is totally fried, piece of junk. But then the question is, if you’re gonna get him a guitar amp, there’s an okay amp and then there’s a good amp. And if you’re gonna make, if you’re a musician, you make a decision like, okay, should it be a tube amp? If it’s a tube amp, then it’s already too expensive.

[00:01:22] David Hornik
In the medley of watching all of the Michael Jackson video a couple of days ago, one of them which I really enjoyed was the Black or white where Collie McCockin gets the amplifiers out and plays a little music for his dad. You should get your kid an amplifier like that all the way to the ceiling.

[00:01:42] Howard Hartenbaum
So do you ever get your, like I only get my kids technology gifts at this point. I got my 7 year old for Hanukkah. Got that programmable Lego. What’s that thing? You know what I’m talking about, the robot. LEGO robot. That thing was pretty awesome.

[00:02:00] David Hornik
My kids spent the last four days with their grandfather learning to program robots in basic.

[00:02:06] Howard Hartenbaum
Oh yeah, that’s cool.

[00:02:07] David Hornik
Like a pretty intense course. And they were pretty excited. They could make the little lights come on and they could make it drive and turn around and decelerate and stop. And I felt good that they weren’t watching YouTube all day. Instead they were actually like programming a robot. And just programming to make the screen change isn’t nearly as much fun as programming to make something drive across the floor and blink and.

[00:02:27] Howard Hartenbaum
Well, that’s it. And so is it the same thing? Is it the, is it the LEGO thing or is it.

[00:02:30] David Hornik
No, no, no, no. This is kind of this fancy. My dad bought It. It’s kind of about the size of a half the size of a shoebox, and it’s got all sorts of servos and lights and little circuit boards and all sorts of stuff. It’s pretty cool.

[00:02:45] Howard Hartenbaum
When I learned BASIC at Stanford, they had this thing called Carol the Robot, but it was this virtual environment, and you could design, you know, super simple programming language. Like you could program Carol to only go left. So in order to get Carol to go right, you had to go left three times, you know, and it was. But it was just about making you think logically.

[00:03:05] David Hornik
And I was pleased because I felt like they learned something. They were excited. It was new. They got both the mechanical side, they got the electrical side, and they weren’t watching YouTube, which is all they ever want to do anyway.

[00:03:18] Howard Hartenbaum
It’s every MIT dad’s dream that their.

[00:03:21] David Hornik
Children learn how to program robots.

[00:03:23] Howard Hartenbaum
Yes. So you seem a little fixated with this YouTube thing, Howard.

[00:03:29] David Hornik
I do.

[00:03:32] Howard Hartenbaum
I’m just amazed.

[00:03:33] David Hornik
So when we were kids, which was a long time ago, or not that long ago, depending on how you look at it, we’d come home from school and we’d drink Coca Cola and we’d watch whatever crap was on tv. And your kids. And my kids, all they want to do is go through YouTube and pick out little funny clips and show you animal clips and show you funny skateboarding accident clips, and they’re perfectly happy to do that all day long.

[00:03:57] Howard Hartenbaum
Yep.

[00:03:57] David Hornik
There’s no TV anymore now.

[00:03:59] Howard Hartenbaum
My kids would much rather watch YouTube. And even the things that would be on TV or movies or TV programs, they’d rather watch on YouTube because it’s on demand. It’s like, it’s this on demand culture. Remember when we. When we were watching tv, as you say, you’d watch what was on, and then you’d have a. Like, oh, on Thursday nights is my program that I’m really excited about, which. That’s totally dead. Like, you know, first of all. So last night, my kids and I watched the Deadliest Catch, which I just love that show. And it was an episode from two weeks ago, I think. And then it made reference to an earlier episode where the guy had, you know, big, giant wave had knocked off the people. And so then we had to go back in our, you know, in our PVR and figure out where that one was and watch it, and it’s just, watch what you want when you want.

[00:04:48] David Hornik
So do you think it’s more about when you want what you want than the fact that there’s so much more content and the content is so unpredictable. Like, my kids like animals, so they’ll, like, find silly things that cats do and they’ll watch through 50 or 100 different videos. And it’s. I think it’s the variety more than the on demand piece.

[00:05:08] Howard Hartenbaum
Well, you know, this. I think we may have talked about this before, but for the earliest days of YouTube, it was tracking perfectly with the growth of MySpace because it was the video delivery solution for MySpace. And that was basically all it was. And then one day they sort of woke up and they had a whole bunch of content and they created the recommendation piece, the. Oh, if you like that video, you’ll also like these sets of videos. And it was at that time, as I understand it, that the curves separated and YouTube started accelerating at a faster pace than MySpace. Because suddenly instead of just going to MySpace and watching videos, you’d watch a video and then you’d say, oh, I like cat videos. And here are seven other cat videos. And they keep. And I’ve been down this rat hole, haven’t you, where you, like, watch one thing and then you go, oh, that’s interesting.

[00:05:55] David Hornik
And 38 minutes later, yeah, I just.

[00:05:58] Howard Hartenbaum
I did this with this. With the soccer, where I started watching this soccer clips, and next thing you know, I was watching, you know, literally 38 minutes was probably short of clip after clip after clip after clip.

[00:06:11] David Hornik
So a lot of people when they’re shopping online, they go online and they want to buy some sunglasses. After about 30 minutes later, they bought a pair of shoes. There’s just this natural progress, like you’re watching soccer clips, and the next thing you know, you’re watching cats, and then pretty soon you’re watching and then you buy one. Then you buy something.

[00:06:30] Howard Hartenbaum
You buy a cat.

[00:06:31] David Hornik
So it’s kind of this natural progress. I saw on the news that YouTube has increased their storage per clip size to two gigs, and they’re taking HD.

[00:06:41] Howard Hartenbaum
Now, which is unbelievable because that’s a lot of content.

[00:06:45] David Hornik
Particularly if I would have thought they would have cut it back. Yeah, if you want to do two gigs, that’ll be $2.

[00:06:51] Howard Hartenbaum
Hey, pay up. It doesn’t look like advertising is making up the difference.

[00:06:56] David Hornik
I don’t think so. So I’d like to advertise on YouTube, though.

[00:07:00] Howard Hartenbaum
What would you like to advertise?

[00:07:02] David Hornik
I would like to find videos that I really like and then advertise on those good videos and send them to my crappy videos so that I could get views.

[00:07:09] Howard Hartenbaum
Well, that’s a good business. They should do that.

[00:07:12] David Hornik
How come they don’t let people sponsor videos like other people’s videos and take a cut of that.

[00:07:18] Howard Hartenbaum
They should. Well, they.

[00:07:19] David Hornik
That’s a form of self expression. Right. I like this video instead of liking it. You can only like it if you pay to like it.

[00:07:25] Howard Hartenbaum
Well, that could be, you know, brought to you by this cat singing brought to you by Howard Hartman.

[00:07:31] David Hornik
Brought to you by Venture Cast.

[00:07:32] Howard Hartenbaum
Yeah, right, exactly.

[00:07:33] David Hornik
This cat singing brought to you by two cats fighting.

[00:07:37] Howard Hartenbaum
You know, I’ve been amazed. I’ve been. I’ve started to pay attention to the advertising on. On Facebook, which I originally thought was sort of stupid and never kind of never made a whole lot of sense, etc. And yet now, now when I look at those ads, they’re pretty interesting. Like, they. They seem to be reasonably smart contextually, you know, except that I keep up getting this one that says, you know, over 40 singles and it has this woman who’s sort of 50, arguably over 40 and hot, you know, and it’s like, you should click here. That seems to be the one I get most of all. I told my wife this. She didn’t seem too worried about it, frankly.

[00:08:17] David Hornik
I went to Facebook’s new office.

[00:08:20] Howard Hartenbaum
Oh, did you?

[00:08:20] David Hornik
I did.

[00:08:21] Howard Hartenbaum
Last week over on California Ave. No.

[00:08:23] David Hornik
How is it they didn’t plan well for having a thousand employees in the building and only having 400 parking spaces?

[00:08:29] Howard Hartenbaum
Yeah, that’s a problem. This is California.

[00:08:31] David Hornik
You have to park down the street. Whatever it was, it was a nice office. The outside of the building kind of looks like it could use a coat of paint. It’s kind of dated, but you get inside and upstairs, beautiful skylights and just, you know, nice space between the desks and lots of people. And evidently all of the engineers and management are downstairs where it’s dark and that the engineers and the management all want to be where there’s no skylights, there’s no high ceilings. It’s just kind of dark and dark.

[00:08:57] Howard Hartenbaum
Just the marketing and sales, marketing and.

[00:08:58] David Hornik
Business development and sales. They all get the top floor floor, which is the level you come in, and it’s really beautiful. And they have this nice cafeteria in there. It’s really nice. Just if you want to join Facebook, you should be in sales, marketing or business development, not in management or engineering.

[00:09:13] Howard Hartenbaum
Yep, that makes perfect sense. So I heard that Facebook actually had to put a bunch of money into that building because it’s so in the middle of nowhere that, like, they had to put better cafeterias in. And they had to. And they had so that basically people wouldn’t need Wouldn’t want. Want to or need to leave. Was that the ca. Did you see that?

[00:09:32] David Hornik
Or was it they do they have a nice cafeteria and they have, you know, it’s nothing like Google’s, but they do have a nice place. They don’t. They don’t have enough capability to move people through there fast enough. So there’s quite a line.

[00:09:46] Howard Hartenbaum
Yeah.

[00:09:46] David Hornik
When you come in to get some food.

[00:09:48] Howard Hartenbaum
But I mean, you could go to California Ave. Right. And they have a shuttle bus to the train and they have all that stuff.

[00:09:53] David Hornik
So the California Ave. Side, I think for most people would probably drive because they’re on the other side of El Camino and so it’s way up the way. So I think people would drive actually down to the other side.

[00:10:02] Howard Hartenbaum
Yes.

[00:10:02] David Hornik
And then there’s no parking on California Ave. Anyway down there, so.

[00:10:05] Howard Hartenbaum
No, no, but Joni’s is good. I like Jony’s.

[00:10:08] David Hornik
They could get like those little electric scooters. A thousand Facebook guys on electric scooters.

[00:10:14] Howard Hartenbaum
Or you get your helmet and you. Well, have you noticed that, you know, the Google cafeterias are. Are not quite as fantastic as they used to be?

[00:10:23] David Hornik
They’ve gotten better again, have they? I was actually there, so I’m gonna.

[00:10:25] Howard Hartenbaum
Try and fix that.

[00:10:26] David Hornik
I was there last week for lunch as well. With somebody else.

[00:10:28] Howard Hartenbaum
Yes.

[00:10:29] David Hornik
I like, I know where all the free lunches are. You know, Facebook’s, Google’s. I just wait till the companies get their cafeterias and then I invite myself.

[00:10:36] Howard Hartenbaum
That’s good. Meanwhile, I invite everybody to have sushi at Kagetsu and then I end up paying. So yours is a better deal.

[00:10:41] David Hornik
You end up paying. Part of. It’s my money.

[00:10:43] Howard Hartenbaum
Oh, good.

[00:10:44] David Hornik
Even better.

[00:10:44] Howard Hartenbaum
Well, then keep saving it.

[00:10:46] David Hornik
Yeah. David’s gonna have two Kagetsu lunches soon.

[00:10:48] Howard Hartenbaum
Tomorrow. Tomorrow I have two. This is actually unbelievable. I mean, I have a lunch at 12 and I have a lunch at 1. I hope my lunch at 12 is over by 1.

[00:10:57] David Hornik
It will be over, but you must eat very lightly.

[00:11:00] Howard Hartenbaum
Yeah.

[00:11:00] David Hornik
So I’ll have six pieces of sushi.

[00:11:03] Howard Hartenbaum
Thank you.

[00:11:03] David Hornik
Very healthy.

[00:11:04] Howard Hartenbaum
What a diet. Six more. Seven pieces today.

[00:11:07] David Hornik
Yeah. So at Google, they had this budget cutback at the end of last year. Maybe it was like just coincided with the financial meltdown and they stopped serving food on the weekends and some of the choices were cut back and evidently it’s back up to par. And last week was very good. And I really enjoyed my lunch there.

[00:11:28] Howard Hartenbaum
That’s good. Well, the other thing about Google is that they have a bunch of cafes and some are known for better food than others, particular cuisine or whatever. But I. I had lunch over there with. With a certain someone, and. And. And his cafeteria sucked. It was like. And he didn’t. He. He didn’t really want to acknowledge that because it’s a little bit of a pride thing.

[00:11:51] David Hornik
The company’s been around long enough where you have people who’ve been there for three, four, five years who, you know, they like the company and they like their job. They’re just kind of interested in doing something new.

[00:12:03] Howard Hartenbaum
This is Google or Facebook.

[00:12:04] David Hornik
Google. Yeah.

[00:12:06] Howard Hartenbaum
They’re gonna. When you say that, they’re gonna stop letting you come over. They’re gonna be like, oh, here comes Howard. He’s just trolling for people to start companies.

[00:12:13] David Hornik
Oh, I’m just having lunch with my friends, and some of them say, yeah, I have this really neat idea.

[00:12:18] Howard Hartenbaum
Well, when Google first went public, I had every intention of setting up the. You know, the vc, as in booth, and people could come give me their. Give me their resumes and their business plans. And, you know, we should do that. I mean, just as a service. We just want to be helpful.

[00:12:35] David Hornik
Do you think like the Charlie Brown? The doctor.

[00:12:38] Howard Hartenbaum
Yeah, exactly. The VC’s in, right?

[00:12:40] David Hornik
Yeah, but if we do it on their campus, they’ll probably tear us off.

[00:12:43] Howard Hartenbaum
Well, no, I figured out where you can do it, because there’s a park right next to their campus. It’s a public park that literally is right next to it.

[00:12:50] David Hornik
Is that where they have the goats that are chewing the grass?

[00:12:52] Howard Hartenbaum
I think so, yes.

[00:12:53] David Hornik
I went there, I looked for the goats. I couldn’t find them.

[00:12:56] Howard Hartenbaum
No, I discovered. You know what? You know what they used to chew the grass in Machu Picchu? No.

[00:13:04] David Hornik
What do they use to chew the grass in Machu Picchu?

[00:13:07] Howard Hartenbaum
Well, it’s actually not that hard to figure out. They use llamas.

[00:13:11] David Hornik
Did you eat any llamas while you were there?

[00:13:13] Howard Hartenbaum
I ate alpaca.

[00:13:14] David Hornik
Oh, sorry.

[00:13:15] Howard Hartenbaum
It is llama, basically. I’m sure there’s some distinction between llama and alpaca, but there’s only one reason.

[00:13:21] David Hornik
Why I hate YouTube is because this song on there called I’m a Llama.

[00:13:24] Howard Hartenbaum
I’m a llama, llama, llama, llama, duck.

[00:13:26] David Hornik
Oh, I hate that llama song. My kids play that. It’s insane.

[00:13:29] Howard Hartenbaum
Llama, llama, duck over and over and over.

[00:13:32] David Hornik
Yeah. So you know what I’m talking.

[00:13:34] Howard Hartenbaum
I do. She’s kicked up. Think something. Llama, llama, llama, llama, llama, llama, llama, llama, so what are they gonna do? I mean so. So I think I’ve passed on this fact before in venture cast but it is now the. The largest search search URL in the world is google.com the second largest search URL in the world is YouTube.com there’s more search traffic on YouTube than there is on Yahoo Search or Bing. And so it’s I like bingo. You do?

[00:14:04] David Hornik
I do.

[00:14:04] Howard Hartenbaum
I like checking it out.

[00:14:05] David Hornik
I do. I like the picture every day and I like that you can mouse over and learn little things and just kind of looks fresh and new. I mean I’m a Googler but every now and then I try out being and I don’t feel dirty for doing so.

[00:14:17] Howard Hartenbaum
Is that right? Even though you like the pictures?

[00:14:20] David Hornik
I like the pictures. I think it’s nice.

[00:14:22] Howard Hartenbaum
What do you think of the results?

[00:14:25] David Hornik
I don’t notice all that big a difference. I don’t use all the features that they have. I just kind of type in and look for the results that come up and they seem perfectly fine to me. But I like the pictures and the.

[00:14:33] Howard Hartenbaum
Real and you know, it speaks to the fact that basically search is search. I get this point. The idea that you differentiate on decidedly better search results is not between Yahoo and Google and Bing and Ask doesn’t. It’s not even. There’s no real distinction.

[00:14:51] David Hornik
We’ve seen lots of interesting search related companies come in and show us and each one has a little slightly different twist to what to do. But pretty hard to pick out which one would be more successful than Google.

[00:15:03] Howard Hartenbaum
But man, if you figure it out, we’re definitely interested. Keep coming, keep coming. We definitely are believers, but it is tough.

[00:15:10] David Hornik
I want to go back to your Machu Picchu statement.

[00:15:12] Howard Hartenbaum
Machu Picchu.

[00:15:13] David Hornik
You showed me this really cool video of Machu Picchu on your iPhone.

[00:15:18] Howard Hartenbaum
That is true. That is true. So I should defend myself. I’m not like just flying off to Machu Picchu because I’m one of these VCs who like, hey, let’s go on an adventure trip to Machu Picchu. My son was doing this service trip thing and I had to deliver. I literally had to deliver him to Peru. So I took one extra day and I went to Machu Picchu. So I’m not like just.

[00:15:40] David Hornik
And I saw the video and it looked nice.

[00:15:42] Howard Hartenbaum
It was good, isn’t it?

[00:15:43] David Hornik
You were wearing a var T shirt.

[00:15:45] Howard Hartenbaum
I did. I wore a vark T shirt to the top. So this is the thing. So have you seen this? If you go to to Aardvark’s Google page. They have a page where you can put a picture of yourself up in. In a vark shirt. So I said, all right, I’m going to be a good board member and I’m going to bring my vark shirt, and when I go to Machu Picchu, I’ll take a picture at the top and that’ll be awesome. And apparently threw down the gauntlet because a number of people commented there was a woman in Africa who has her varkini. Apparently there are aardvark bikinis, and she intends to up me up the.

[00:16:15] David Hornik
That’s called good use of venture capital. We fund a company and they buy Varkinis.

[00:16:21] Howard Hartenbaum
I think this is brilliant. I gotta tell you, I have always been a big believer in swag. I think it’s important to keep the team engaged and motivated. I like the power of brand. I want people to be engaged. And so I’m, you know, within reason. I don’t want the aardvark tuxedo or whatever, but I mean, you know, I’m a big believer in the company T shirts. Don’t you. Don’t you think that every one of your companies should have company T shirts? That.

[00:16:45] David Hornik
Because then we never have to go shopping for T shirts ever again.

[00:16:48] Howard Hartenbaum
God, no. We clearly don’t. All you have to do is be around Peter Pham long enough.

[00:16:54] David Hornik
David had a pizza fest here for some. Some people he done some work with. And Peter. Peter Pham comes along and he had what, like 80 T shirts over his shoulder. He was walking around handing them out to everybody. And I don’t know, he had a trunk that big on his car to carry all those things clearly full.

[00:17:09] Howard Hartenbaum
And you could pick which variety you want it. So it will be nice and say. Billshrink.com Peter’s the CEO of Bill Shrink. But, you know, if you ever see him, he’s in a Bill Shrink T shirt. Just as. Just as Max Mantilla is always in a vark T shirt. I mean, I’m a believer in this. So anyway, so I wore my Aardvark T shirt, I went to the top of Machu Picchu, and then I had. I have the new iPhone, and the new iPhone has video on it. And so I took. Instead of just taking a picture of Machu Picchu, which gives it. Which is great. Like, it’s pretty amazing. And I took some great pictures with this, with the new camera on the iPhone. But then I took a video that swept around from sort of left to right so that you could see the scale of Machu Picchu and it was awesome.

[00:17:52] David Hornik
And I’m looking at your phone and I was having phone envy because I have one of those older 3G iPhones and I want a new one now. How much does that thing cost you?

[00:17:59] Howard Hartenbaum
That is sad. I don’t know. I think it was 299 bucks.

[00:18:06] David Hornik
And you had to sign up for two more years or something. What’d you do with your other phone? You know, it’s like sold it on ebay.

[00:18:11] Howard Hartenbaum
It gets passed down to the next generation of Hornic. So some other, some smaller Hornic now has my 3G and I have the, the 3G whatever.

[00:18:22] David Hornik
That video was so good on your phone. I wonder what’s going to happen to the flip.

[00:18:26] Howard Hartenbaum
It is an interesting question. Flip may have. Pure digital may have done just the right thing and sold at just the right time. Because if, if great video can be had on the iPhone and then, and then obviously other platforms soon enough. That’s a big problem, right?

[00:18:42] David Hornik
I mean I have a real, I have an HD flip and I frankly, I love it. I think it’s a great product. But I hardly ever use it because it’s never with me. And if your phone is always with you when you want it, that’s the whole thing. So I, I would say, you know, I’m gonna get the new iPhone with video and I’m gonna sell my, my flip on ebay.

[00:19:03] Howard Hartenbaum
Oh, well, alright, you heard it here. I have my Flip HD and I, and I agree that’s awesome.

[00:19:09] David Hornik
You ever use it?

[00:19:10] Howard Hartenbaum
And occasionally I’d like to bring it to kit events and I don’t know that the iPhone will replace that. But you know, but I do think it puts a lot of pressure on it because it is this great device, it’s easy to sync, etc. And now the iPhone is clearly that, right? You just plug it in and boom, it uploads to iphoto. And so it’s an, it’s an interesting thing. So have you at least upgraded the software on your iPhone?

[00:19:35] David Hornik
No.

[00:19:35] Howard Hartenbaum
You need to. It is awesome. No, I can’t. I cannot understate the degree to which the new iPhone software is spectacular.

[00:19:45] David Hornik
Okay, I will do it this afternoon.

[00:19:47] Howard Hartenbaum
Thank you for the recommendation because here’s the biggest problem that the iPhone had that all of these things have, which is that the search is terrible. Search on your email. Just eat it, Howard. Howard keeps like picking up the three bucks.

[00:20:00] David Hornik
This year I put candy on the counter and like it’s staring at me.

[00:20:03] Howard Hartenbaum
But he doesn’t Want to make noise with the wrapper, but just. Just make the noise. Seriously, Howard, don’t let us get in the way of your sugar high. But anyway, the search, the new search, the 3.0 software search, is so good. It’s so fast. It searches everything on your phone, including the content of your mail, that it alone, you know, it was worth hundreds of dollars to pay for that software upgrade, and yet it was for free. And frankly, the. The difference between the 3G and the 3Gs with the new software is not huge. Except for video and a compass.

[00:20:40] David Hornik
I will do it today, and then I will go and buy the video on the way home.

[00:20:46] Howard Hartenbaum
Right, Exactly.

[00:20:46] David Hornik
I wasn’t gonna do it because after I saw your video, I wanted one of those things, so.

[00:20:50] Howard Hartenbaum
Yeah, that’s fair.

[00:20:51] David Hornik
But I’m gonna sell mine on ebay.

[00:20:53] Howard Hartenbaum
How much can you get for it?

[00:20:55] David Hornik
I better get a few hundred. I don’t want to give it to my kids because I’d have to pay that extra 30 bucks a month.

[00:21:00] Howard Hartenbaum
Yeah.

[00:21:00] David Hornik
Per kid.

[00:21:01] Howard Hartenbaum
A lot.

[00:21:01] David Hornik
Yeah, it’s a lot of money.

[00:21:02] Howard Hartenbaum
It adds up. I bet you I’m paying hundred. I’m paying hundreds of dollars to AT&T a month now between my wife and my kids. And it’s just crazy.

[00:21:11] David Hornik
I mean, if you think of. If you’re paying 200amonth and you’re paying 50% tax bracket, that’s five, six grand a year. Wow, that’s a lot of money. Well, I guess what we need is communication, food, and entertainment.

[00:21:25] Howard Hartenbaum
That’s it. That’s all we need. So I bought. So the same week that I bought the new iPhone, I bought a Palm Pre. Because, you know, in my one pocket right now I have a trio. In the other pocket, I have the iPhone. I think that the iPhone is great media device. I think it’s got the best browser, I think it has the best handling for photos, etc. But it has no keyboard, and I don’t like it as an. As an email device. And so I thought, okay, maybe the Palm Pre will solve this problem. And so I went and I bought a Pre, and I returned it three days later. So that’s not good. And I returned it for two reasons. One, just sitting in my pocket, I did nothing. I didn’t drop it. I didn’t do anything. Just sitting in my pocket, the corner of my phone broke. And it’s the way the thing’s designed. When you pull out the keyboard, then the tolerances on the. On the screen itself go to this quite small kind of point. And it’s just not. It’s not well manufactured. It’s not well made. And I think that. That they’re gonna have big problems with kind of the build. So that was problem number one. Problem number two is it’s not a very good email device. Like, the. The keyboard’s okay, and the email integration is okay, but they fail in a lot of simple little things. Like when you read an email and then you. And then you delete it, it doesn’t bring up the next email. It takes you back to the inbox. What is that? Are you kidding me? Like, how. How efficient is that? It would take me. It would take me all of 280 to read through my email.

[00:23:02] David Hornik
Do you have any idea what percentage of people carry two active mobile devices at the same time? I mean, I see a lot of.

[00:23:09] Howard Hartenbaum
People who carry Sandhill Road. We see it a lot. Or Basilica.

[00:23:11] David Hornik
I don’t. I think one is enough. But you carry two. I see a lot of people carrying two. Does anybody have an idea what percentage that is?

[00:23:17] Howard Hartenbaum
I don’t know, but I’d say, first of all, it’s way bigger here than in most places. But it’s an incredible indictment of these devices that, that any of us is carrying more than one. But I am.

[00:23:31] David Hornik
I bought One of those MacBook airs a couple weeks ago. Yeah, I took it with me.

[00:23:35] Howard Hartenbaum
Oh, you went to Japan?

[00:23:35] David Hornik
I went to Japan on a. On a business trip, which I did have fun on my business trip, but it was still a business trip nevertheless.

[00:23:42] Howard Hartenbaum
You had like 73 meetings in a week or something.

[00:23:44] David Hornik
Yeah, it was really. It was really exhausting. I met with one of my companies that we invested in called Swoopo is looking at Japan, and I met with a bunch of potential partners, with a bunch of lawyers, with a bunch of people who might. We might want to hire. Plus I met with a bunch of e commerce companies. I met with a bunch of investors. I met with Google and YouTube and net price and Rakuten and Excite and just a lot of really interesting people. And every meeting was in somebody else’s office. And Tokyo was a big city and there was taxis or trains between everyone. And it was hot and humid and I was wearing a suit. And so, you know, each evening when I came. Well, most couple of evenings, I went out to dinner until about 10, but I was just totally exhausted when I came back. But luckily my new MacBook Air was waiting there for me and I would just open it up and it didn’t make any noise and it just came to Life got the solid state drive and it would just come up and instantly, no waiting. And it was just a wonderful device and the keyboard is backlit so I could type in the dark. And it was just, it was wonderful. And you know when you’re jet lagged and you’re up in the middle of the night, you don’t want all the room lights on to completely wake you up. You just want to stare into your screen. It was really wonderful.

[00:25:00] Howard Hartenbaum
So you’re a believer. I like the MacBook Air, your new traveling computer.

[00:25:04] David Hornik
I like it. I was just bringing my iPhone with me, but this was so nice and it was so light that I think I’m going to bring it with me, me everywhere.

[00:25:11] Howard Hartenbaum
So I have a MacBook Air and I liked it and I was traveling with it. But then I found that because it only has one USB port and you have to get everything as a peripheral. So if you want to, you know, like you need a disk drive as a peripheral, etc. That and, and it doesn’t, you know, you have to remember if you want to hook up to, to, you know, to the network without wireless, you need a peripheral, etc. That it sort of made me crazy after a while. So now I travel just with a MacBook Pro.

[00:25:43] David Hornik
Well, I hate the movie industry because I wanted to load a bunch of movies onto the hard drive so I could watch them on the plane that.

[00:25:51] Howard Hartenbaum
You had legitimately bought or rented.

[00:25:53] David Hornik
Legitimately rented. These were Netflix movies and I simply wanted to transfer them onto the hard drive so I didn’t have to bring the external drive with me on the plane. It wouldn’t use as much power in doing it. And I simply wanted to watch these movies and then erase them when I was done. And I couldn’t do it legally. I couldn’t do, I wouldn’t do it, nor could I do it legally. The DRM on there makes it impossible to do. So I had to bring the external drive with me and the discs, which I didn’t want to bring either of them with me. And it just pisses me off. Movie industry are just a bunch of idiots. I’m paying them for their movies and here they just make my life more difficult.

[00:26:32] Howard Hartenbaum
Well, you know, there’s a history of that. Look at, look how, look how what a pain itunes is. First of all, you know, five computers, it can’t exceed it. And then I had this where I rented a movie on itunes and it, you know, if you rent it and you start watching it on your ipod, then it starts the time Click, ticking. And if you pause it, but it lasts longer than the period of time you pass by the 24 hours or whatever, then it stops. You can’t watch it anymore. So I’ve got halfway through a movie and then it, it’s too late and I couldn’t watch the rest. And so you think that’s bad.

[00:27:05] David Hornik
Oy, that’s insane.

[00:27:07] Howard Hartenbaum
It is insane.

[00:27:07] David Hornik
You give them your good money and look what they do to you.

[00:27:10] Howard Hartenbaum
But I agree. So I agree with you. But I like the air. I think it’s nice. And the new air is even better. It’s faster, cheaper.

[00:27:17] David Hornik
That’s the one I got.

[00:27:17] Howard Hartenbaum
And it’s got better. More storage. I bought the SSD when it just first come out. Came out and it was a thousand dollars for like the world’s smallest hard drive.

[00:27:27] David Hornik
Yeah.

[00:27:27] Howard Hartenbaum
And that was a lot less than that.

[00:27:28] David Hornik
17.99 or 16.99, the largest drive.

[00:27:31] Howard Hartenbaum
Unbelievable.

[00:27:32] David Hornik
It was awesome.

[00:27:33] Howard Hartenbaum
Nice.

[00:27:34] David Hornik
So in the world of venture capital funds, we have a new. A new brethren on the street who Patriot looking forward to working with. Potentially.

[00:27:44] Howard Hartenbaum
Yeah. No, absolutely. Mark Andreessen now has an Andreessen Horowitz.

[00:27:50] David Hornik
Yep. I like the fact they use their own names. I think that shows, you know, you can trust. You can trust them. They put their names on it. Yeah.

[00:27:57] Howard Hartenbaum
It’s old school. Right. Like Meryl Pickering.

[00:28:00] David Hornik
They didn’t, they didn’t name themselves. Happy Go Lucky Ventures, Happy Gilmore Ventures.

[00:28:07] Howard Hartenbaum
Nope. Forrest Gum Ventures and Dreesen Horowitz. So they managed to raise 300 million in a time when old school venture firms that have been in the business for a long time can’t raise, you know, 100 million bucks. Brand new firm managed to raise $300 million.

[00:28:25] David Hornik
Good for them.

[00:28:26] Howard Hartenbaum
What do you think of that?

[00:28:27] David Hornik
I think it’s fantastic. I think it shows that, you know, they’re both good entrepreneur. Excellent, great, fantastic entrepreneurs.

[00:28:34] Howard Hartenbaum
About as good as they get.

[00:28:35] David Hornik
And they’ve done some great investing. And they gave a story to the investors and we share some of the same investors, which is. Is good. And I would give them my money, but they didn’t ask me for it.

[00:28:49] Howard Hartenbaum
We share. Not only would you share the same investors, but we share the same story. Right. Which is they believe if you. So Mark, who I think is an incredibly good blogger, his, his blogs, P. Marka and he, and he wrote about the new fund and he described that sort of tenets of their investing and it sounded just like the stuff we say to our investors. Right. It’s. And we believe in the long term Value of technology. We believe that companies are entrepreneurial, driven that. He said they like entrepreneurs who are CEOs and continue to stay on and run their businesses. They will look anywhere. But they think there’s something special about Silicon Valley that results in the creation of great companies. And so they intend to invest in large part in Silicon Valley. They said that they thought there were lots of opportunities to build, to invest it early, but they also wanted the flexibility to invest late. So they actually have the capacity to invest as little as, you know, 50k in a company, but as much as $50 million, which is our story. I mean, we have as we can invest 50k in a company, we can invest as much as $310 million. Wow.

[00:30:00] David Hornik
Pretty big company.

[00:30:01] Howard Hartenbaum
That would have to be a heck of a deal. But if you have it, we want to hear about it. That’s it. And. And they actually talked about it. Well, it’s buyouts and leverage buyouts and management buyouts and those sorts of things. And we like, we continue to look at those things. So it was just very interesting to read the description because we absolutely share their passion for technology and for company building and for teams and their enthusiasm for the market going forward. And so it’s great. It’s great that they, that they raised the fund. It’s great that. And it’s great to have them in the market. I’ll tell you one of the things that’s amazing to me. I blogged about this on Venture Blog, but so often we hear entrepreneurs that are critical of the venture industry, right? You know, you read these, oh, VCs are the bad guys, blah, blah, blah. And here are two of the great entrepreneurs of our day coming together to create a venture fund. And they’re not saying, oh, we’re gonna, you know, screw VCs, it’s broken. And they’re doing it the wrong way. They say, we think there’s value in venture investing. We think there’s value in investing early and investing late in companies that are building important technology. And so I think it’s great. I’m glad that we have them in the marketplace, and I certainly hope that we have the opportunity to work with them sometime soon. That’s cool.

[00:31:20] David Hornik
Yeah, we’re in. I’ve never met either of them, actually. But you know them both.

[00:31:26] Howard Hartenbaum
Sure, but you’ve met, didn’t you. I mean, the other day we had a bunch of people over here for an aardvark meeting, and Mark was here, didn’t you? Didn’t get a chance to meet him. When he.

[00:31:34] David Hornik
Nope.

[00:31:35] Howard Hartenbaum
All right, we’ll have to make that happen. He’s a great guy.

[00:31:38] David Hornik
Yeah, I hear excellent things about him.

[00:31:41] Howard Hartenbaum
So there you go. Time to meet Howard.

[00:31:43] David Hornik
If I was an entrepreneur, I would go and pitch them, but I’m not.

[00:31:46] Howard Hartenbaum
But you should also pitch us.

[00:31:47] David Hornik
Oh, yeah.

[00:31:51] Howard Hartenbaum
So that would be good. Well, you should pitch us both.

[00:31:53] David Hornik
Yeah.

[00:31:53] Howard Hartenbaum
All right, cool. What else we got, Howard? What else is happening in this wacky world of technology and blah, blah.

[00:32:00] David Hornik
I was, you know, you and I were talking about brain enhancing medications.

[00:32:07] Howard Hartenbaum
Yes, yes, we were.

[00:32:09] David Hornik
And we were talking about performance enhancing medications where some athletes take. Of writing.

[00:32:16] Howard Hartenbaum
Oh, I’m glad you’re talking about athletes. I was a little nervous there for a second. About performance enhancing.

[00:32:21] David Hornik
No, no, no, because I get that.

[00:32:23] Howard Hartenbaum
I get seven of those emails a day.

[00:32:25] David Hornik
You just don’t have a good spam filter.

[00:32:27] Howard Hartenbaum
Apparently not.

[00:32:28] David Hornik
And I think it’s kind of an interesting. It’s an interesting topic where in our society that many people perceive drugs to be okay, whether it’s for, you know, to help them stay up all night to study for their tests or to help them think more clearly because they want to, you know, work hard and do a great job, or because they want to have a faster swimming or track time and they take medication to do that. And I think my personal opinion is that all these, you know, these chemicals are bad for you and you shouldn’t be taking them well.

[00:33:03] Howard Hartenbaum
So just to give the context, I mean, I have recently had a number of conversations with Silicon Valley entrepreneurs about, about these brain drugs, and in particular, people using off. Off prescription medications for things like add, as, as essentially speed, to focus, to stay up all night and program, etc. And then there’s this new drug, I guess it’s not incredibly new, but relatively new, called Provigyl, which I recently learned was developed for pilots so that they could stay awake for long periods of time, not. Not crash. And it’s not. It doesn’t affect your metabolism, your anabolic processes. It just is, you know, it’s speed. And apparently there are lots of entrepreneurs in Silicon Valley who are using this stuff to stay up all night, to code, to be more focused, to need less sleep. And now they’re kids taking this stuff, you know, to study for their SATs or take their SATs to, or whatever. And it’s pretty amazing. I’m sort of stunned by it, to tell you the truth.

[00:34:13] David Hornik
I’m stunned because one thing we see historically is drugs are popular for something and later the side effects come out and they’re really bad. Like Vioxx destroys your heart or, you know, it was just a great painkiller. It was just, you know, anti inflammatory and it happened to cause a lot of heart problems for people. We’re hearing last week about Vicodin and Tylenol, Acetaminophen causing liver failure. Drugs are just basically really bad. I think you eat foods to stay nourished and healthy and if you’re really suffering some medical condition and you need to take drugs to get better or to tolerate the pain is one thing. But I think people taking drugs to increase their performance on bike riding or swimming or your brain performance for coding all night and thinking that, well, I’m young, I’m strong and that’s not me, I’m not young and strong. But some thinking, you know, the guys were fun, the guys who are taking these drugs and then you know what happens to them later. Then they start having problems in a few years and maybe they have liver problems or they get, you know, some terrible disease. I just think it’s, it’s unfortunate.

[00:35:20] Howard Hartenbaum
So, but you know, the other side, I was talking with a VC friend and we were having this very conversation. He said, well, look at, you know, I’m on a statin for my, you know, for high cholesterol. And he said, I have, I have a friend who’s a cardiologist and he says the single most important advancement in managing heart disease has been the statin and the fact that that. And it’s driven, driven down heart attacks by a huge amount. And so if, why is that different? Right?

[00:35:49] David Hornik
Because that’s a medical need that doing something and you are taking risks of other side effects from having those statins. We just don’t know what they are. But I think when you, you know.

[00:35:58] Howard Hartenbaum
You’Re a puritan, Hal.

[00:35:59] David Hornik
I am.

[00:36:00] Howard Hartenbaum
I can’t believe it. Do you drink?

[00:36:03] David Hornik
You know, you know, in the use. I do, but you know, in the use of negative language, I was learning a couple years ago, my kid’s school, some father told his kid don’t cross the street. And the kid herd cross the street and ran out and front of the car and got run over. And luckily he survived but the 5 series BMW rolled over him and cracked his hip bone. But whenever people say don’t do drugs, I never liked that line because you.

[00:36:33] Howard Hartenbaum
Always hear do drugs.

[00:36:34] David Hornik
All you hear is kids hear do drugs, drugs, this. But you know, I think I’m disappointed to hear that people are taking drugs to stay up all night and work harder and this and That I think it’s terrible, but I am a puritan.

[00:36:44] Howard Hartenbaum
And anyway, anyway, it’s just very interesting because I hadn’t heard about it until recently and then I’ve heard that there are lots of people out there doing it.

[00:36:51] David Hornik
So how do you feel about it as it relates to sports? I mean, it’s illegal to do in most sports, yet a lot of people still do it. And therefore if you are the guy who doesn’t, you’re at a disadvantage.

[00:37:01] Howard Hartenbaum
It’s true. I stay up all night just based on eating cookies.

[00:37:07] David Hornik
I just ate four.

[00:37:08] Howard Hartenbaum
That should be a sufficient.

[00:37:09] David Hornik
I just ate four. Four three Musketeers bars.

[00:37:11] Howard Hartenbaum
That sounds, those are mini three Musketeers bars. I mean.

[00:37:13] David Hornik
Yeah, but you know how many I ate beforehand?

[00:37:15] Howard Hartenbaum
No, I don’t. But I mean, you know, you have the highest metabolism of any human being. I know.

[00:37:21] David Hornik
Yes, that’s because I take metabolism enhancing drugs. I like to eat.

[00:37:26] Howard Hartenbaum
Actually I was talking, one of these guys, I was talking about these, these drugs, these brain performance enhancing drugs and said, oh, actually if you want to lose weight, you should take, you know, whatever the ADD drug is of choice. I can’t forget, can’t remember because it also is a, is an appetite suppressant. So you’ll, you’ll be up all night and you won’t eat.

[00:37:44] David Hornik
Great.

[00:37:45] Howard Hartenbaum
Like, wow, I gotta get some of that. How do I get that? And the answer is you make sure that your children are diagnosed with some attention deficit disorder and then you use their drugs.

[00:37:54] David Hornik
I mean, we didn’t bring this up just to, you know, espouse our views. I think it was more that it’s just shocking to hear that people who are professional and well educated and successful are taking brain enhancing drugs. And it surprises me.

[00:38:09] Howard Hartenbaum
So it is surprising. But I was reading a thing in Stanford magazine. There’s a Stanford Law School professor who wrote a book about this and he basically said, look, it’s not different than any other medical advancement and we’re counting on human intellect to drive society forward, forward to do things like come up with alternative energy, come up with, you know, better ways to live, et cetera. And why shouldn’t, if we can make people better thinkers, then isn’t it our obligation to do it? And shouldn’t we be working on these drugs because in the aggregate then they’ll increase the total value of human brain power for all these other problems. So what do you say to that?

[00:38:51] David Hornik
I think that professor probably has a lot of money invested in healthcare stocks.

[00:38:57] Howard Hartenbaum
He’s like a big genentis yeah, he’s.

[00:38:59] David Hornik
Looking for money on the drug side.

[00:39:00] Howard Hartenbaum
Well, he probably got funded by them. But anyway, it’s just an interesting. Interesting. It’s interesting. There you have it. That’s it.

[00:39:07] David Hornik
Interesting.

[00:39:08] Howard Hartenbaum
It’s just interesting. Well, that sounds like a good way to end. I think. Now, this is like the puritanical Venture Cast.

[00:39:17] David Hornik
Thank you for your time today.

[00:39:19] Howard Hartenbaum
And so, 1. Are we gonna have a chance to do this again in a couple weeks? Because we took a little longer than our couple weeks this time.

[00:39:25] David Hornik
That’s your fault. I was here and waiting when we were scheduled to do it.

[00:39:28] Howard Hartenbaum
What? Seriously?

[00:39:29] David Hornik
No.

[00:39:30] Howard Hartenbaum
Okay, Come on.

[00:39:31] David Hornik
I just do it when you drag me in your office and you say, hey, Howard, it’s Venture Cast.

[00:39:35] Howard Hartenbaum
You’re off to Munich for your SWOOPO board meeting. But you’ll be back. Yes, I’m off to my babysitter. My old babysitter’s getting married. Gotta go to her wedding. But I’ll be back. So until then, we’ll see if technology continues to move the pace.

[00:39:52] David Hornik
Goodbye.