All Segments
a16z Podcast | Technological Trends, Capital, and Internet 'Disruption'
41 segments available
with Fred Wilson (@fredwilson) and Chris Dixon (@cdixon) There's all sorts of interesting tech trends happening right now, including AI, VR/AR, self-driving cars and drones (as well as interesting stuff happening in verticals like healthcare and finance) -- and there's a lot also happening in seemingly more "mature" tech revolutions, such as mobile and cloud. But where are we now, really, with these shifts... and how does that inform how we think about the next couple decades? And does a framework like Carlota Perez's -- as outlined in Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages and summarized by venture capitalist and longtime internet investor Fred Wilson (of Union Square Ventures) -- fully apply when it comes to software? Because, argues Chris Dixon (general partner on a16z crypto), software "has so much more plasticity, ability to adapt, ability to evolve" that unlike hardware, "the core itself will also dramatically change... not just the apps around it". The total economic value that will be unlocked with the software revolution, observes Wilson, should be orders of magnitude bigger than what we saw with manufacturing for sure. But just how much internet innovation is actually powering true disruption (i.e., is more than just a sustaining innovation, to use Clayton Christensen's terminology)? How do new business models change everything? Dixon and Wilson consider all this and more in this hallway-style episode of the a16z Podcast, where we recorded the two having a think-aloud conversation about everything from the history of the internet and startups, the evolution of capital and infrastructure, to the advent of crypto. How do they they both define "decentralized", what do they think of dApps, and where do NFTs and "crypto goods" come in?? One thing's for sure: It's the most interesting time they've both ever seen in over 30 years of internet work, life, and play. Please note that the a16z crypto fund is a separate legal entity managed by CNK Capital Management, L.L.C. (“CNK”), a registered investor advisor with the Securities and Exchange Commission. a16z crypto is legally independent and operationally separate from the Andreessen Horowitz family of fund and AH Capital Management, L.L.C. (“AHCM”). In any case, the content provided here is for informational purposes only, and does NOT constitute an offer or solicitation to purchase any investment solution or a recommendation to buy or sell a security; nor it is to be taken as legal, business, investment, or tax advice. In fact, none of the information in this or other content on a16zcrypto.com should be relied on in any manner as advice. You should consult your own advisers as to legal, business, tax and other related matters concerning any investment.
Segments Timeline
Welcome to the a16z Podcast
In this introductory segment, the hosts welcome listeners to the a16z Podcast, setting the stage for a conversation between venture capitalists Fred Wilson and Chris Dixon. They will explore current tech trends, including AI, crypto, and the evolution of the internet, while reflecting on the past and future of technological innovation.
"hi everyone welcome to the a 6 & Z podcast I'm sonal we recently took the a 6 and Z podcast on the road to New York City and so today's episode features a fly-on-the-wall recording of a conversation b..."
The State of Technology in 2018
Fred Wilson discusses the current state of technology in 2018, highlighting the dominance of trillion-dollar tech companies and the perception of the tech industry as maturing. He raises questions about the future of innovation and how it informs our understanding of the next few decades, referencing Carlota Perez's framework for technological revolutions.
"may go next are we seeing disruption or is a lot of current innovation just as sustaining innovation to borrow from clay Christensen's framework or how about Carlota Perez this framework for tech revo..."
Frameworks for Understanding Tech Revolutions
Wilson elaborates on Carlota Perez's framework, suggesting that technological shifts can last for a century. He argues that the internet and tech represent the current technological revolution, and despite feeling mature, there are still decades of potential innovation ahead. He emphasizes the need for a more open and competitive landscape in tech.
"content provided here is for informational purposes only and does not constitute an offer or solicitation to purchase any investment solution or a recommendation to buy or sell a security nor is it to..."
The Unique Nature of Software
Dixon contrasts software with hardware, arguing that software possesses greater adaptability and potential for evolution. He suggests that unlike traditional industries, the core of software can change dramatically, leading to unprecedented economic value and innovation opportunities in the tech landscape.
"framework and as a lot of people who you know follow me and us vino we're really big fans of Carlota Perez and if you look at the big technological shifts that have happened over the past 200 300 year..."
The Impact of Over-the-Air Updates
Dixon highlights the transformative power of over-the-air software updates in vehicles, using Tesla as an example. He discusses how this capability alters service models and industry structures, emphasizing the increasing prevalence of software in everyday life and its implications for future technological advancements.
"another 50 60 70 years to go and I think you know going back to something that Marc Andreessen said you know in the original design of the internet and the world wide web you know we didn't necessaril..."
The Future of Software-Driven Innovation
Dixon speculates on the future of software-driven innovation, suggesting that as more processes become software-based, the total available market for technological shifts will expand significantly. He envisions a world where software underpins more aspects of business and personal life, unlocking new possibilities.
"don't dramatically the cars has stayed mostly the same you know obviously got better but they're they're still the same basic function same basic you know kind of design and then all the action from I..."
Disruption vs. Sustaining Innovation
Wilson and Dixon discuss the current landscape of innovation, arguing that while there are clever inventions, much of it is sustaining rather than disruptive. They analyze how established tech giants have adapted to new platforms without being significantly disrupted, raising questions about the true nature of current innovations.
"course at the at the bottom level it's copper and other you know fiber and other things in radio waves um but but the heart of it is software and I just wonder if software has my view software has so ..."
The Role of Crypto in Disruption
Dixon posits that crypto represents a significant disruptive force in the tech industry, fundamentally changing business models. Unlike traditional monetization methods, crypto relies on underlying tokens, suggesting a shift in how value is created and exchanged in the digital economy.
"broke down all the time and so the big innovation was service centers everywhere and so you know this this change in being able to update over-the-air also changes for example the service model and ni..."
The Evolution of Business Models
The conversation shifts to the evolution of business models in tech, with Dixon noting how Google transformed applications by making advertising the primary revenue source. They discuss how this shift has allowed new entrants to disrupt established players, highlighting the importance of innovative business models in driving change.
"monopolies because of the data the fact that you're differentiating the AI through data and and they're most likely to have the most data I forget where I read this and this is this data is now four o..."
Reflections on Internet History
Dixon reflects on the early days of the internet, contrasting it with today's landscape. He emphasizes the rapid evolution of technology and the need to understand historical context to appreciate current innovations, suggesting that many people overlook the foundational changes that have shaped the internet.
"don't understand why the map interface hasn't become the default interface for dispatch of anything whether it's a scooter or a car or a bike or whatever maybe it's just like it's going to sometime ye..."
The Disruption of Business Models
Chris Dixon discusses how cryptocurrency represents a fundamental shift in business models, moving away from traditional monetization methods like ads and subscriptions to a model based on underlying tokens. He compares this disruption to the early days of the internet, suggesting that just as the internet changed everything, crypto has the potential to do the same.
"fundamental change in business model you're not monetizing with ads you're not monetizing with subscriptions you're monetizing with the underlying token it's just it's it's like we're fog and all - al..."
Google's Advertising Revolution
Fred Wilson reflects on how Google transformed the application business model by making advertising the primary revenue source. He contrasts this with Microsoft's approach, highlighting how this shift allowed for new entrants in the market and fundamentally changed the landscape of internet applications.
"Google did is that they made advertising the business model for applications right like my mail and my you know my browsing and my searching is all supported by advertising like Microsoft would have m..."
Nostalgia for the Early Internet
Dixon and Wilson reminisce about the early internet era, noting how the concept of 'going online' has become archaic. They discuss the slow, cumbersome nature of internet access in the 90s and how innovations were focused on improving user experience during that time.
"that's just everything changes when you change the business model it's like all of a sudden you know your strengths become your weaknesses and and that's what allows a lot of entrance to come in it's ..."
The Early Days of Streaming
Wilson shares his experience with early internet audio and video streaming, referencing Josh Harris's company, pseudo, which was ahead of its time. They discuss how many ideas from that era have now become mainstream, highlighting the evolution of technology and the internet.
"even that doesn't happen right except for like hackers or some couple of like specialty movies or something right and it was essentially you know I mean it was like literally waiting for an image to l..."
The Impact of Broadband on YouTube
Dixon and Wilson analyze how the advent of broadband internet was crucial for the success of YouTube. They discuss the importance of social sharing and the embeddable player, which differentiated YouTube from its competitors and allowed it to thrive.
"it's literally like every unicorn like high company today it was like internet money you know grocery delivery like well you know you and I are friendly with an entrepreneur here in Newark New York na..."
The Role of Incumbents in Cloud Computing
The conversation shifts to cloud computing, with Wilson discussing the competitive landscape among major players like AWS, Google, and Microsoft. They explore how incumbents are leveraging their existing customer bases and technology to gain market share.
"successful where's all the people who tried YouTube before YouTube were we're broadband that's like eighty to ninety percent of it and also social sharing it's the idea that you could take a youtube v..."
The Evolution of Developer Experience
Wilson emphasizes the importance of developer experience in cloud infrastructure, citing Twilio's focus on making integration easy for developers. They discuss how this shift has enabled startups to innovate more rapidly and efficiently.
"them from everybody else and just maybe the timing plus they had a lot of venture capital money behind him so they could spend money sometimes that's different yeah they the I think I was reading this..."
The Future of Cloud Infrastructure
Dixon and Wilson predict a future dominated by a few key players in cloud infrastructure, discussing how startups benefit from this ecosystem. They highlight the ongoing relevance of cloud technology and its role in driving innovation.
"the fresh codebase having the fresh attitude the different perspective you can just you can kind of if you could build on night to them if you could build on stripe versus you couldn't build on stripe..."
The Rise of Enterprise SaaS
The discussion turns to the growth of Enterprise SaaS applications, with Wilson noting that many corporate applications are still not cloud-based. They explore the potential for vertical SaaS solutions to fill gaps in various industries.
"Microsoft has 10 percent of the market I think it's gonna be a three-player game in that business and that's good I think the check the thing I hear from Google is the challenges it's just that the so..."
Incremental Change vs. Job Displacement
Wilson addresses the misconception that AI will replace jobs in a dramatic fashion. Instead, he argues that software applications are gradually making processes more efficient, leading to job displacement in a subtler manner. They discuss the implications for startups and venture capital in this evolving landscape.
"people are still using you know I don't know you go to the whatever you go to the United desk and they've got like a dass interface you go here and they got me says you know I mean the government hack..."
Navigating the Competitive Landscape
Wilson describes the competitive dynamics in the Enterprise SaaS market, where multiple credible competitors exist. He contrasts this with consumer markets, suggesting that while the power-law distribution of outcomes remains, the competition in Enterprise SaaS is fierce but not winner-takes-all.
"a challenge to get those customers and you have to get there's a lot of detailed kind of sales and marketing execution to go reach efficiently I mean that's kind of the trick in a lot of those compani..."
The Evolution of Venture Capital
Wilson and Dixon discuss the changing landscape of venture capital, highlighting the influx of capital available to founders today. They explore the emergence of new funding methods, including crowdfunding and the impact of mega funds on the startup ecosystem.
"and if it's a business that can support you know you know billions of dollars of market value that that could be two or three companies that could be pretty big winners for the founders and for the VC..."
Crypto's Role in Startup Funding
Dixon shares insights on how the crypto market has introduced new capital sources for startups. He emphasizes the potential of crypto to democratize investment opportunities, allowing a broader range of investors to participate in high-growth ventures.
"founders today than there's ever been and I think that's a good thing you know a lot of people in the venture business or the people who give us the money you know think there's too much money and may..."
Empowering Early Adopters in Crypto
Dixon highlights the unique advantage of early adopters in the crypto space, who can both use and invest in projects from the outset. He contrasts this with traditional tech companies, where users often have to wait years to become shareholders, showcasing the innovative potential of crypto.
"innovation right and I understand there's people out there saying there's gonna be scams and you know people are gonna vest and lose all their money and I get all that and I realized that that's that'..."
The Dual Nature of Crypto: Money and Utility
Dixon discusses the dual aspects of crypto, focusing on its role as both a financial asset and a utility. He argues against the division between 'money' and 'utility' in crypto, asserting that the integration of these elements is what makes the technology powerful and transformative.
"strange and wrong the other thing is you know if you were an early user of Facebook you might have said to yourself oh my god this thing's gonna be huge right it was so they so let's say that was 2003..."
The Lifecycle of Tech Networks
Wilson reflects on the lifecycle of tech networks, explaining how they evolve from open ecosystems to more controlled environments as they mature. He discusses the implications of this shift for developers and users, emphasizing the importance of maintaining an open platform to foster innovation.
"thing that they and you don't have to be a user to be an investor and you don't have to be an investor to be a user but if you want to be you can be both and it's just as easy to be like it's just an ..."
The Missed Opportunity of Open Platforms
Fred Wilson shares his experiences on the board of Twitter, lamenting the platform's shift towards a closed ecosystem due to its advertising model. He discusses how an open protocol could have fostered a thriving developer community, allowing for greater innovation and user engagement. This segment underscores the tension between monetization strategies and platform openness in tech.
"bigger and more impactful platform but the logic of the business model the ad based business model said we need to control the experience we need to control where the ads appear we need to like etc et..."
The Promise of Token-Based Models
Wilson speculates on how Twitter could have thrived under a token-based business model, allowing for an open protocol that would benefit both developers and users. He discusses the potential for a more aligned ecosystem where users, developers, and the platform itself could coexist harmoniously, contrasting it with the current ad-based model that often leads to conflict.
"protocol open Twitter could have been the protocol and the third-party clients could have been the clients on top of the protocol and it could have worked beautifully and like part of me just wishes t..."
The Transition to Digital Value
In this segment, the conversation shifts to the evolving perception of digital goods versus traditional assets. Wilson argues that society is in a transition period where digital assets are gaining importance, yet still face skepticism. He critiques the bias against digital currencies like Bitcoin, suggesting that as younger generations grow up, the value of digital goods will be recognized as equal to or greater than physical assets.
"of the people whose jobs it is to regulate and and protect the capital markets because they're looking at that and they're saying there's all these people who own a lot of this thing and they're out t..."
The Future of Digital Goods and Scarcity
Wilson discusses the burgeoning industry of digital goods, particularly in gaming, and the potential for NFTs to create scarcity in a previously replicable digital landscape. He illustrates how digital assets could revolutionize ownership and value in gaming, allowing players to transfer their in-game assets across platforms, thus enhancing user engagement and investment in digital ecosystems.
"primary mm-hm and the and and you see this by the way and all the critiques of Bitcoin for example Oh like in the end a lot of like the you know traditional economist critiquing it boils down to oh it..."
Reimagining Creative Economies with NFTs
The segment explores how NFTs can redefine business models for artists and creators by introducing digital scarcity. Wilson emphasizes the potential for musicians and other creatives to monetize their work in new ways, moving away from traditional revenue streams that have become less viable. This discussion highlights the transformative impact of blockchain technology on creative industries.
"collector of domain names I'm like let me - it's a little piece of the internet like of course it's gonna be valuable and I've always wanted them and I hold on to them and that's a multi only those ei..."
Mining Digital Engagement
Wilson presents a novel idea of 'mining' digital engagement, comparing it to Bitcoin mining. He envisions a future where artists can release their work in a way that mirrors the scarcity and value dynamics of cryptocurrencies. This segment delves into the innovative potential of digital art and music, suggesting that the future of creative industries lies in embracing new technologies and models.
"that we thought we were in kind of this growth period we're actually in this hockey stick right right and I think that sort of I believe one of my theories is wearing this like so to take eSports as a..."
The Role of Youth in Digital Adoption
In this segment, Wilson discusses how younger generations are more open to adopting new technologies like NFTs and digital wallets. He highlights the importance of this demographic in driving the future of digital goods and the potential for gaming to lead the way in this transition. The conversation emphasizes the cultural shift towards valuing digital assets as integral to modern life.
"another game and this person who I was talking to who was a skeptic like a [ __ ] skeptic like you wouldn't believe he's like holy [ __ ] my 12 year old would just be all over that like that's that's ..."
The Evolution of Media and Digital Innovation
Wilson reflects on the historical context of media evolution, noting how early internet investments often mirrored traditional offline models. He argues that true innovation comes from understanding and creating native digital experiences rather than simply replicating existing formats. This segment encapsulates the need for a forward-thinking approach to technology and media.
"coinbase wallet or like that's not gonna get in the way but I think the other thing with excites me is I feel like this should be a wonderful time in history for creative people with you know 4 billio..."
Mining Art and Music: A New Paradigm
Chris Dixon explores the innovative concept of 'mining' listens for music and art, drawing parallels to Bitcoin's scarcity model. He suggests that artists could release their work in a way that mimics the mining process, creating a sense of scarcity while still allowing for broader access. This segment discusses how this model could revolutionize the business of creative content.
"musicians for you know whatever you film makers video makers it reintroducing scarcity allowing kind of business model innovation well the cold the cool thing is it it it doesn't have to be that there..."
The Evolution of Media: From Porting to Native
Fred Wilson reflects on the early days of internet investment, emphasizing the importance of creating native digital experiences rather than simply porting existing offline models online. He draws comparisons to the evolution of film from plays to innovative cinematic techniques, highlighting the potential for new forms of media to emerge in the digital landscape.
"other thing that's cool that's haven't Bitcoin is the value has risen over time I know that's come down recently but it's mostly risen over time as we've started to mine more and more of it right so w..."
Creating New Value in Crypto
Dixon and Wilson discuss the need for innovation in the crypto space, advocating for the development of new concepts that can only exist on blockchain networks. They emphasize the importance of creating unique applications that leverage the decentralized nature of crypto, rather than simply replicating traditional financial models.
"bright with digital goods with music with film with art with other like I think it will be some it's not it's not to make I don't think it's to make like a limited edition piece of your art like that ..."
Staking and Governance: The Future of Crypto
The conversation shifts to the concept of staking in crypto networks, with Wilson highlighting its potential to enhance model quality in data science. They discuss the implications of on-chain governance and the need for decentralized networks to achieve higher transaction speeds, setting the stage for future innovations in the crypto ecosystem.
"yeah like like autonomous organizations right this concept which is now it kind of fell a little bit of disrepute because of this thing called the Dow which was kind of mismanagement it's unfortunate ..."
The Road to Decentralization
Wilson outlines the current state of crypto networks, emphasizing the need for truly decentralized and secure systems capable of processing transactions efficiently. He draws parallels to the early internet and mobile phone evolution, expressing hope for a breakthrough moment in crypto that will lead to widespread adoption and innovation.
"governance you know on chain governance is that gonna work I don't know I think I like part of me says it'll never work and part of me is like I hope it does work obviously we're both excited about cr..."
The Next Big Wave in Crypto
In this segment, Wilson and Dixon discuss the potential for a new wave of applications in the crypto space, akin to the explosion of internet apps in the past. They reflect on the importance of infrastructure development driven by demand from innovative applications, particularly in gaming, which could catalyze the necessary advancements in crypto technology.
"you think remember like remember winter the sign people were building like what were they called where they call that was it was a map or something there was like some yeah some standard for building ..."
Investing in the Future: A Cautious Optimism
The discussion concludes with Wilson's insights on the current investment landscape in crypto. He expresses a cautious optimism about the future, recognizing the potential for groundbreaking innovations while acknowledging the challenges and volatility of the market. This segment encapsulates the excitement and uncertainty surrounding the future of crypto investments.
"largely we're not investing in a lot of daps I mean we are playing around with NF T's and games for all the reasons you you raise I just think that's the first place that we might see it and by the wa..."