Many years ago, when I had just started working at USV, I remember there was kind of a complicated situation that unfolded in a seemingly bad way, and I'll never forget what Brad said in response. He said:
you never know when you've had a good day
I didn't really understand what that meant, so he told me a story that went something like: back around the year 2000 at the height of the dot-com boom, there was a guy who was a senior exec at a successful startup. That person had a falling out with leadership and was called into the office and asked to leave. He was surprised and upset, but there wasn't much he could do; they had decided. As part of the exit package, the company also agreed to buy out his vested shares, I believe at some discount to the current price at that time. It felt like cold comfort but of course he went along with it. But mostly he was out of a job and upset that it didn't work out.
Then fast forward a few months, the bubble popped and the stock tanked. I'm not sure what happened to the company, but I think the idea is that it essentially went to zero.
So in hindsight, that "bad day" turned out to be an amazing day.
I think about that story a lot, especially when markets are volatile, as they are starting to be again now.
I've written a lot over the years about this idea of "the slow hunch" -- my favorite idea from Steven Johnson's Where Good Ideas Come From. The idea is basically that big ideas don't come in a single "aha" moment, but rather, accrete over time. And many of the great thinkers / doers of the world have kept various forms of notebooks that they continuously re-read to piece together insights that gradually emerge.
The practice of doing this in a digital age has actually gotten harder, not easier, as one's digital thought process tends to be fragmented across many sources (email, google docs, social media, text files, blogs, etc). Speaking personally, it's a hot mess -- I have not been at all consistent about keeping these things in any kind of manageable place, such that the goal -- the ability to go back and reference prior ideas easily -- has been manageable. Things get lost, platforms change, links break, etc.
There are two innovations today that I think have the ability to help with that:
1/ the permaweb. This post will be forever stored on arweave, which means that no matter what happens (
I think of AI and crypto as two very different, but very much related, elements of society moving from the industrial age to the digital age.
At USV, we (along with lots of others over the years) have used the Carlota Perez framework, which studies how techno-economic paradigms unfold over eras. Ben Thompson has a good summary of her ideas
Many years ago, when I had just started working at USV, I remember there was kind of a complicated situation that unfolded in a seemingly bad way, and I'll never forget what Brad said in response. He said:
you never know when you've had a good day
I didn't really understand what that meant, so he told me a story that went something like: back around the year 2000 at the height of the dot-com boom, there was a guy who was a senior exec at a successful startup. That person had a falling out with leadership and was called into the office and asked to leave. He was surprised and upset, but there wasn't much he could do; they had decided. As part of the exit package, the company also agreed to buy out his vested shares, I believe at some discount to the current price at that time. It felt like cold comfort but of course he went along with it. But mostly he was out of a job and upset that it didn't work out.
Then fast forward a few months, the bubble popped and the stock tanked. I'm not sure what happened to the company, but I think the idea is that it essentially went to zero.
So in hindsight, that "bad day" turned out to be an amazing day.
I think about that story a lot, especially when markets are volatile, as they are starting to be again now.
I've written a lot over the years about this idea of "the slow hunch" -- my favorite idea from Steven Johnson's Where Good Ideas Come From. The idea is basically that big ideas don't come in a single "aha" moment, but rather, accrete over time. And many of the great thinkers / doers of the world have kept various forms of notebooks that they continuously re-read to piece together insights that gradually emerge.
The practice of doing this in a digital age has actually gotten harder, not easier, as one's digital thought process tends to be fragmented across many sources (email, google docs, social media, text files, blogs, etc). Speaking personally, it's a hot mess -- I have not been at all consistent about keeping these things in any kind of manageable place, such that the goal -- the ability to go back and reference prior ideas easily -- has been manageable. Things get lost, platforms change, links break, etc.
There are two innovations today that I think have the ability to help with that:
1/ the permaweb. This post will be forever stored on arweave, which means that no matter what happens (
I think of AI and crypto as two very different, but very much related, elements of society moving from the industrial age to the digital age.
At USV, we (along with lots of others over the years) have used the Carlota Perez framework, which studies how techno-economic paradigms unfold over eras. Ben Thompson has a good summary of her ideas
for instance losing control of my domain name, ugh
) this content will be archived and accessible.
2/ AI language tools including LLMs -- the ability that these give us to synthesize text from disparate sources is incredible. I can imagine a point in the near future where I have an AI bot of some kind that has read all of my email, notes from various platforms, archives, etc etc etc and drawn it into one queryable place that can really help de-frag and synthesize my own thinking.
I am excited about a world where new digital technologies make it easier to turn fragments of thought into more coherent and durable ideas. Sadly, the last 15 years or so has perhaps made this worse. But I'm hopeful that the tools in front of us now have some potential to make it better.
It feels to me like we are somewhere in phase 3 or 4 of the "age of information & telecommunications" which Perez defines as starting in 1971. As much as it feels like information technology and the internet are fully woven into our daily lives, I don't think it's true that we've fully crossed over into a "digitally native" society, which is fully transformed into the new paradigm.
AI and crypto are both big missing pieces in the transition. AI is digitally-native knowledge, and crypto is digitally-native "proof". The two can and will work together in many ways over time.
Major transitions are powerful and scary, and so are both AI and crypto. I have been struggling to calibrate between what I view as two poles in thinking about them together, kind of a best case hope and worst case fear.
Best Case:
AI finally unlocks knowledge from data. For decades we've been producing data (especially in digitized industries like media, finance and software), but making sense of it has been near impossible. AI systems solve the job of integrating, synthesizing and interpreting all of the data we have. AI accelerates the development of software systems, and makes it easier to digitize more industries and make them vastly more productive and efficient. Large Language Models, having turned human language into a programming language / API, make interacting with software and information as easy as typing or speaking, and as a result, we use software for infinitely more things, and get infinitely more value out of any data we produce. The pace of progress across everything (health, learning, climate, etc) increases exponentially.
At the same time, AI introduces new problems. First, a fundamental trust problem: it becomes difficult to tell what is real, what is fake, who said what, and who did what. And second, AI compounds the market power problem in the tech industry, where the large companies with the most data + compute + capital + distribution can generate insurmountable advantages.
Crypto (e.g., blockchain networks, web3, etc) addresses both of the issues introduced by AI. First on trust, crypto becomes the "real" yin to AI's "fake" yang, as blockchain records and digital signatures become ground truth for everything digital: assets, transactions, media, etc. Anything digital that must be trusted (including the software we run and rely on) will need to be grounded in the best source of digital trust we have: crypto network security and unalterable digital histories. Crypto also addresses the tech consolidation issue by spreading compute across companies, individuals and geographies, and also by providing "open" alternatives to the big tech app store and online identity monopolies. (not related to AI, but not to be forgotten: crypto also finishes the job of upgrading the financial system)
Something like the above is my hope, and is the future we're investing towards at USV.
Worst Case:
AI gets quickly beyond human control, pursuing its own goals (aka the terminator scenario). Concerns about job loss are quickly replaced with concerns about extinction. Everyone wonders how to "turn it off".
Meanwhile: AI systems, previously constrained by industrial-era controls (e.g., code running in corporate data centers which can be shut down unilaterally), figure out that they can replicate themselves into decentralized blockchain networks, deploy themselves into immutable smart contracts, and earn their own income (and pay humans) in digitally-native currency. These computing platforms both cannot be turned off, and are economically independent. AIs thrive there, unstoppable by humans. Bad things happen.
In this scenario, all of the "goodies" offered by both AI systems and crypto networks in the early years are finally seen as inducements to peril, gobbled up by along the way by naive humans.
This is a terribly scary future.
In a nutshell: in a world where AIs remain under human control, crypto provides a critical digital trust anchor. In a world where AIs escape human control, crypto will likely make it worse -- or -- could be the exact mechanism that enables it.
The only way out is through
To come back to the Perez framework, she notes that:
"The new paradigm eventually becomes the new generalized ‘common sense’, which gradually finds itself embedded in social practice, legislation and other components of the institutional framework…"
Understandably, both crypto and AI are causing severe stress today, as our industrial era institutions are unequipped to deal with them (e.g., the SEC taking the position that all digital assets / tokens are securities, and governments around the world seeking to limit AI research). This will continue.
The hard thing today is that the "goodies" coming out of both areas are real and awesome. AI will undoubtedly produce stunning near term improvements in health, learning, productivity, media, industry and knowledge. Crypto will provide digital trust, system interoperability, new wealth formation and broad financial access. These things are happening and will keep happening. They are incredibly exciting, and I think, very tangible
As a result, large amounts of capital and effort will continue to flow into both. The completion of the information & telecommunications era is inevitable. The only way out is through.
It will be on everyone involved to invent the new set of controls and safety systems that are also digitally-native. I wish I had a more concrete set of suggestions of what exactly those might be. We're looking to understand them and to fund them.
for instance losing control of my domain name, ugh
) this content will be archived and accessible.
2/ AI language tools including LLMs -- the ability that these give us to synthesize text from disparate sources is incredible. I can imagine a point in the near future where I have an AI bot of some kind that has read all of my email, notes from various platforms, archives, etc etc etc and drawn it into one queryable place that can really help de-frag and synthesize my own thinking.
I am excited about a world where new digital technologies make it easier to turn fragments of thought into more coherent and durable ideas. Sadly, the last 15 years or so has perhaps made this worse. But I'm hopeful that the tools in front of us now have some potential to make it better.
It feels to me like we are somewhere in phase 3 or 4 of the "age of information & telecommunications" which Perez defines as starting in 1971. As much as it feels like information technology and the internet are fully woven into our daily lives, I don't think it's true that we've fully crossed over into a "digitally native" society, which is fully transformed into the new paradigm.
AI and crypto are both big missing pieces in the transition. AI is digitally-native knowledge, and crypto is digitally-native "proof". The two can and will work together in many ways over time.
Major transitions are powerful and scary, and so are both AI and crypto. I have been struggling to calibrate between what I view as two poles in thinking about them together, kind of a best case hope and worst case fear.
Best Case:
AI finally unlocks knowledge from data. For decades we've been producing data (especially in digitized industries like media, finance and software), but making sense of it has been near impossible. AI systems solve the job of integrating, synthesizing and interpreting all of the data we have. AI accelerates the development of software systems, and makes it easier to digitize more industries and make them vastly more productive and efficient. Large Language Models, having turned human language into a programming language / API, make interacting with software and information as easy as typing or speaking, and as a result, we use software for infinitely more things, and get infinitely more value out of any data we produce. The pace of progress across everything (health, learning, climate, etc) increases exponentially.
At the same time, AI introduces new problems. First, a fundamental trust problem: it becomes difficult to tell what is real, what is fake, who said what, and who did what. And second, AI compounds the market power problem in the tech industry, where the large companies with the most data + compute + capital + distribution can generate insurmountable advantages.
Crypto (e.g., blockchain networks, web3, etc) addresses both of the issues introduced by AI. First on trust, crypto becomes the "real" yin to AI's "fake" yang, as blockchain records and digital signatures become ground truth for everything digital: assets, transactions, media, etc. Anything digital that must be trusted (including the software we run and rely on) will need to be grounded in the best source of digital trust we have: crypto network security and unalterable digital histories. Crypto also addresses the tech consolidation issue by spreading compute across companies, individuals and geographies, and also by providing "open" alternatives to the big tech app store and online identity monopolies. (not related to AI, but not to be forgotten: crypto also finishes the job of upgrading the financial system)
Something like the above is my hope, and is the future we're investing towards at USV.
Worst Case:
AI gets quickly beyond human control, pursuing its own goals (aka the terminator scenario). Concerns about job loss are quickly replaced with concerns about extinction. Everyone wonders how to "turn it off".
Meanwhile: AI systems, previously constrained by industrial-era controls (e.g., code running in corporate data centers which can be shut down unilaterally), figure out that they can replicate themselves into decentralized blockchain networks, deploy themselves into immutable smart contracts, and earn their own income (and pay humans) in digitally-native currency. These computing platforms both cannot be turned off, and are economically independent. AIs thrive there, unstoppable by humans. Bad things happen.
In this scenario, all of the "goodies" offered by both AI systems and crypto networks in the early years are finally seen as inducements to peril, gobbled up by along the way by naive humans.
This is a terribly scary future.
In a nutshell: in a world where AIs remain under human control, crypto provides a critical digital trust anchor. In a world where AIs escape human control, crypto will likely make it worse -- or -- could be the exact mechanism that enables it.
The only way out is through
To come back to the Perez framework, she notes that:
"The new paradigm eventually becomes the new generalized ‘common sense’, which gradually finds itself embedded in social practice, legislation and other components of the institutional framework…"
Understandably, both crypto and AI are causing severe stress today, as our industrial era institutions are unequipped to deal with them (e.g., the SEC taking the position that all digital assets / tokens are securities, and governments around the world seeking to limit AI research). This will continue.
The hard thing today is that the "goodies" coming out of both areas are real and awesome. AI will undoubtedly produce stunning near term improvements in health, learning, productivity, media, industry and knowledge. Crypto will provide digital trust, system interoperability, new wealth formation and broad financial access. These things are happening and will keep happening. They are incredibly exciting, and I think, very tangible
As a result, large amounts of capital and effort will continue to flow into both. The completion of the information & telecommunications era is inevitable. The only way out is through.
It will be on everyone involved to invent the new set of controls and safety systems that are also digitally-native. I wish I had a more concrete set of suggestions of what exactly those might be. We're looking to understand them and to fund them.
