00:22:46 · Scott Kupor
In order to do that right, the needs of the entrepreneurs are different. So all of these, like, ancillary operating services we built, they all also need to feather in into these different verticals that we can do the things that are appropriate for the entrepreneurs. So, like, what a gaming entrepreneur needs in terms of business development support is totally different than what a life sciences entrepreneur needs. And so we went through this process of basically, you know, disaggregating everything into these structures, and we just kept a few things centralized that made sense. Like, so legal and finance. Right? Core compliance functions. Look. You don't necessarily want people doing those separately on their own. Let's keep those centralized, you know, investor relations. Right? From an LP's perspective, their view is, look. Like, I want to interact with Andreessen Horowitz as a firm. I don't wanna have to, like, build completely independent relationships. So we kept feeling centralized. And so what that did for me, which admittedly, I will say, and, you know, Marc Andreessen, I fought initially because when you go from owning everything, right, you go from owning everything, you're like, wait a second. I all of a sudden feel like my domain got a lot smaller. In fact, actually, Ben, I heard him talk about this on a podcast. He said exactly what I felt, which is true. It's like, anytime you do a reorg in a company, you know, you always get a lot of hurt feelings. Right? Because by definition, somebody in a reorg has fewer things than they used to have. Basically, that's just the nature of it. It took me a while before, again, this was another one where my ego got hurt. Was like, Wait a second. I thought I was doing a pretty damn good job managing these things. Marc Andreessen said, Look, we're not saying you're not doing a good job. We're saying the needs of the business have changed, the needs of the business demand that we do this, and so let's go find other ways in which you can add value to the business. So that was kind of when I finally got an opportunity to start doing some investing, and what I recognized again was, look, I can't do early stage tech investing because I'm just not a domain expert, and so we started a later stage fund, we call it later stage venture, for lack of a more creative word. And we started that in 2019.
00:24:32 · Scott Kupor, David Senra
We brought him in a guy named David George from GA, General Atlantic who had been doing this. He was great. And so I basically started working with David and kind of carved out more of, like, doing stuff on the health care side. So by the time I left for government, I had about 15 companies that I invested in, about 10 of which that I was sitting on the board of, but doing stuff where the evaluation of the company was more about the operational successes and kind of the opportunity for the company from, like, one to infinity as opposed to the zero to the one side of investing, which I just didn't feel like I had the right skill set to do. [00:25:01] S1: So you just mentioned it, then you decide to leave after sixteen, seventeen years, you take a hard turn- [00:25:08] S2: Do you think so? [00:25:08] S1: I sure do think so. Into government. Why? [00:25:12] S2: Yeah. My wife asked me that a lot too. Look, this seems to [00:25:16] S1: be a reoccurring theme with your My wife questioning
00:25:18 · Scott Kupor
[00:25:18] S2: your wife is way smarter than I am, and her job is mostly, yes, to question, like, what the hell am I doing? So the historical reason was I had literally done policy stuff starting in... Literally in high school, actually. I worked for a group back in high school that used to do health care policy research, so we were trying to figure out... We were doing breast cancer screening stuff. Right? You know, like, do the economics look like? And then when I went to Stanford, I worked for a professor, this guy named Alan Garber, who's actually now the president of Harvard, doing stuff around prostate cancer. Right? Which is okay. Like, does it make sense to screen large populations of men for prostate cancer? And I won't go into details, but it turns out there's these weird nuances of prostate cancer. The basic answer is most men die with some form of prostate cancer. Very few men die of prostate cancer. And so screening broad populations can be problematic because you will catch a lot of stuff that never would have actually had health outcomes. Anyway, so I've been doing that, and then when I went when I went to Stanford through law school, I actually worked for another guy who... His name is in the news today, a guy named Jay Bhattacharya, who now runs the NIH, if you follow that. Jay was a researcher at Stanford. I was his grunt. I used to do, like, modeling for him for this policy group that worked on. So I always had these, like, interests in policy, and then whatever, life kind of intervened, and I ended up obviously going in a different path and going to the private sector. But at some point in my bucket list, I always thought I'd do policy stuff. The reason now was really a couple of things. One was just from a personal perspective, like, was the right time in my life to do this. So my kids were all out of the house at this point in time. Marc and Ben were incredibly gracious and said, hey. Look. If this is what you want to do, like, we're happy to support it. You know, they were... They enabled me to kind of transition my stuff off and, you know, gave me the freedom to do that. And obviously, I've been very lucky just financially along the way to have the means to be able to kind of take a break from the business.
00:27:03 · Scott Kupor, David Senra
And then the second thing was, look, I really believe that what I learned in venture capital might have some applicability to what I would do in government. So the job I have is this, I run this group called the Office of Personnel Management. Essentially, could think of us as we are the HRtalent agency for the 2,000,000 some million federal employees. So, we are responsible for, like, making sure we have the right people coming into government, and then all the policies that govern talent, essentially, in the government. And why did you [00:27:28] S1: think those... They were skills transferrable from your previous job to this one, though?
00:27:28 · David Senra, Scott Kupor
[00:27:28] S1: think those... They were skills transferrable from your previous job to this one, though? [00:27:32] S2: Because what I learned, and particularly, you know, through all the stuff I've done with working for Marc Andreessen, companies, and managing people, is something very simple, which will sound like so obvious, but I think it's really true, which is, look, organizations are pretty simple. It doesn't matter if you're a government organization, or a private organization, or a not for profit, They're all the same, which is all an organization is, it's a collection of people who are just aligned around a similar set of objectives. Like, it's no more complicated than that. The question is, like, do you have the right set of objectives? Do you have the right people? And then do you have a set of incentives that track to those objectives so that when people do the things you want them to do, they get rewarded and recognized, and you can then kind of do 10 more great objectives? Or when they don't do that, do you have a mechanism to either correct that behavior and or remove them to the organization? And so when I looked at that, was like, okay. I'm gonna come to government, and it's a totally different set of objectives, which I agree. But the fundamental question is, like, do we have the right people, and do we have the right incentive structure to actually enforce the behavior we want? And the short answer, particularly on the latter side, is, like, the incentive structure is completely screwed up from my perspective.
00:27:32 · Scott Kupor, David Senra
[00:27:32] S2: Because what I learned, and particularly, you know, through all the stuff I've done with working for Marc Andreessen, companies, and managing people, is something very simple, which will sound like so obvious, but I think it's really true, which is, look, organizations are pretty simple. It doesn't matter if you're a government organization, or a private organization, or a not for profit, They're all the same, which is all an organization is, it's a collection of people who are just aligned around a similar set of objectives. Like, it's no more complicated than that. The question is, like, do you have the right set of objectives? Do you have the right people? And then do you have a set of incentives that track to those objectives so that when people do the things you want them to do, they get rewarded and recognized, and you can then kind of do 10 more great objectives? Or when they don't do that, do you have a mechanism to either correct that behavior and or remove them to the organization? And so when I looked at that, was like, okay. I'm gonna come to government, and it's a totally different set of objectives, which I agree. But the fundamental question is, like, do we have the right people, and do we have the right incentive structure to actually enforce the behavior we want? And the short answer, particularly on the latter side, is, like, the incentive structure is completely screwed up from my perspective. [00:28:30] S1: Before you move on, let's describe this. Why is the incentive structure completely screwed up from your perspective?