Jack Dorsey: “When we started Square, we thought we were just building a piece of hardware” In his blog post Product First, David Sacks explains that the founding of Square—described by Jack Dorsey in the clip below—resembled his own experience at PayPal. Most people think startups begin with brilliant insight and the founders have it all figured out from the beginning. But startups are messier than that. As David explains in the blog post: “Founders usually start with a product idea. They know users will like it but may be a bit hazy on the exact market, buyer, or business model. Those details get filled in over time. By launching the product first and learning from its adoption, founders discover the market insight, then build the organization they need to operationalize it.” This is exactly what happened at Square. As Jack explains: “When we started, we thought we were just building a piece of hardware to enable people to plug into their phone and swipe a credit card. And then as we talked with people and dug in some more, we found a consistent theme: many of them weren’t even allowed to process credit cards.” David noticed that both Square and PayPal followed three steps: 1. Create the product hook: “the starting point was to conceive of a simple product that would create tangible value.” For PayPal, this was the ability to ‘email money.’ 2. Discover the market insight: “the market is discovered as a result of seeing who uses the product and why.” PayPal stumbled upon eBay sellers who were unable or unwilling to go through the lengthly underwriting process to accept payments. 3. Operationalize the insight: “Once [Square] discovered the theme of access, it had the ‘north star’ to continually expand its offerings” As David summarizes: “The company starts with a product hook to grab users and a distribution trick to find them, pays attention to the organic use of the product to discover the market insight, then leans into that insight to build the company.” Video source: @lexfridman (2020)

Peter Thiel on the link between technological progress and the health of our democracy Thiel explains the famous “We wanted flying cars, instead we got 140 characters” quote on the Founders Fund website: “It was a commentary on technology — we were promised these massive breakthroughs that would transform the way the world works, and then we got incremental communication technologies.” He continues: “The striking thing is that we live in a world that doesn’t look that different from the 1980s. We’re looking at screens and distracted by our iPhones all the time, but the iPhones that distract us from our environment also distract us from the way in which our environment strangely hasn’t changed. We’re riding on a 100-year-old subway in New York City. The zoning laws made it so that cities like San Francisco haven’t changed in 50 years and aren’t that technologically advanced.” Thiel elaborates on why this is such an important problem: “One of the ways our society — liberal democracy or representative government — works is that you have scientific, technological progress going on in the background. You have growth and the pie is growing. If the pie grows, we can find creative ways to shift the pieces so that everybody gets more. When the pie stops growing and there’s no progress, then you end up in this polarized world with these zero-sum politics — for every winner there’s a loser, and anyone who succeeds is suspected of being part of some kind of racket or something. And so I think there is actually a pretty deep link between this question of scientific and technological progress and the health of our representative democracy.” Video source: @RubinReport (2018)

Peter Thiel: world-class entrepreneurs are typically polymaths “I think that one kind of perspective for a lot of the world-class entrepreneurs is that they’re not specialists. They’re something closer to polymaths.” Thiel continues: “If you have a conversation with Mark Zuckerberg, he’d be able to speak with a surprising amount of understanding about a lot of things. He can speak about the details of the Facebook product. He can talk about the way people think about social media — the psychology and the way the culture is shifting. Management of the company, he has ideas on that. He has ideas on how [Facebook] fits into the bigger history of technology.” Thiel then contrasts this to a more typical academic view: “The academic view is that you’re sort of a narrow expert on one thing and that’s what you do. But it’s much more this polymath-like intellect that understands all these different things.” Video source: @RubinReport (2018)

Steve Jobs: “My model of business is The Beatles” “[The Beatles] were four very talented guys who kept each other’s negative tendencies in check. They balanced each other, and the total was greater than the sum of the parts. And that’s how I see business. Great things in business are never done by one person. They’re done by a team of people.” Steve continues: “The Beatles — when they were together — they did truly brilliant, innovative work. And when they split up, they did good work, but it was never the same. And I see business that way too. It’s really always a team.”

Peter Thiel tells the founding story of PayPal “When you start one of these companies, it’s typically not the case that you get the whole idea fully formed instantaneously,” Thiel begins. “There was this incredible internet boom going on in Silicon Valley in the late 1990s. It felt like there was this open frontier or gold rush, and one of the natural things to look at was finance.” At the time, Thiel was very interested in the idea of creating new forms of money. “There’s always something super mysterious, powerful, and important about money,” He explains. “And we had this general idea to do something with security, money, and payments very early on in the founding of the company. Then you iterate a lot on how to get the idea out.” Thiel continues: “The critical question for any consumer internet product is not what the idea is, but ‘how do you get distribution?’ There had been a lot of internet payments companies that had already started and failed by 1998… They would’ve worked if everybody used them, but you could never get the first person to start. So the challenge was how to make it go viral and how to get something to work where it’s good for the first person, the 10th person, and the 100th person. Once you have millions of people, you have a network and network effects. That was sort of the chicken and egg problem we wanted to solve.” Eventually the team stumbled on the idea of linking money with email: “There were already 300 million people in 1999 that had email accounts. So if you could send money to an email address… you didn’t need both counterparts to a transaction to be part of the PayPal network. Only the sender could be part of it, and then the recipient would sign up as they took money out. We started with the 24 people in our office, and they sent money to friends and other people. Then we gave these referral bonuses of $10 if you got someone to sign up, and it just grew exponentially. It grew about 7-10% compounding daily… We had 1,000 people in mid-November of 1999. By the end of December it was 12,000. By February 3, 2000, it was 100,000. By mid-April 2000, it was up to a million.” The other critical component of PayPal’s success was starting with customers who had an intense need and minimal downside risk: “One of the natural places that it started was on the eBay auction site where you had small dollar transactions of maybe $40 as the typical amount. If you send a check across the country, that’s a 10 day delay. It’s slow, and most people aren’t set up to process credit cards.” Thiel reflects on what it felt like to go from 1,000 users to 1 million in just a few months: “[It felt like] you were at the forefront of some sort of revolutionary thing. It’s incredibly exciting and incredibly scary. It was like ‘we’re going to take over the world’ or ‘we’re all going to die’ and you move between those two several times a day.” Fraud was a major challenge the company had to solve — especially because making a product hard to defraud is usually at odds with making it easy to use. Thiel had an interesting perspective of operating in strange regulatory zone with this new form of moving money: “I often thought of it at the time that we were in a race between technology and politics. The politicians didn’t like us, but if we got the PayPal network to be big enough, it would sort of overwhelm the regulators and they’d have to accept it as a fait accompli… One of the execs at PayPal said we needed to hire a whole bunch of lawyers to tell us what we can or can’t do, and we said no we’re not going to hire them. They’ll just tell us what we can’t do. We have to just go ahead and not hire the lawyers and just do it.” Video source: @RubinReport (2018)

Improving retention the old-fashioned way: 16,000 A/B tests… @duolingo

Jensen Huang: digital biology will be “one of the biggest revolutions ever” “Where do I think the next amazing revolution is gong to come? And this is going to be flat out one of the biggest ones ever. There’s no question that digital biology is going to be it.” Jensen continues: “For the first time in human history, biology has the opportunity to be engineering, not science. When something becomes engineering, not science, it becomes less sporadic and exponentially improving. It can compound on the benefits of the previous years. And every researcher’s contributions compound on each other… We’re going to have incredible tools that bring the world of biology—which is very chaotic and constantly changing and diverse and complex—into the world of computer science. And that is going to be profound.” He tells the student audience at Berkeley: “If you happen to love this intersection, I think it’s going to be rich with opportunities. It’s going to be a giant industry.” Video source: @BerkeleyHaas (2023)

Duolingo founder on the key to solving retention “The way we solved [retention] was just through trial and error,” Duolingo founder Luis Von Ahn explains. “By now, some of us have some intuition about what is good for gamification, but the reality is that most of it is just trial and error.” He continues: “In the history of Duolingo, we have run 16,000 A/B tests. Each one of those is trying to figure out if we change these little things — “should this button be red or blue?” — to try to get you to come back. And it’s these 16,000 A/B tests that have made our retention outstanding. At this point our user engagement is starting to get comparable to social networks.” Video source: @StanfordGSB (2025)

Jeff Bezos’s two pieces of advice for aspiring entrepreneurs “The advice that I would give entrepreneurs is don't chase the hot new thing. It's so hard to catch something that everybody already knows is hot. Instead, position yourself and wait for the wave to come to you.” The best way to position yourself, Jeff argues, is to pursue something that captures your curiosity. When Amazon startup, Jeff always asks himself if the founder is a “missionary” or a “mercenary.” “I don't like mercenaries, and I don't like mercenary cultures. The missionary is building the product, building the service, because they love the customer, because they love the product, because they love the service. The mercenary is building the product or the service so that they can flip the company and make money.” One of the great paradoxes of entrepreneurship is that the missionaries usually end up making more money than the mercenaries anyways. After you’ve picked something you’re passionate about, Jeff’s second piece of advice is: “Start with the customer and work backwards… Those two things will take you an awfully long way.”

Patrick Collison on thinking for yourself: "Nobody is going to teach you to think for yourself. A large fraction of what people around you believe is mistaken. Internalize this and practice coming up with your own worldview. The correlation between it and those around you shouldn't be too strong unless you think you were especially lucky in your initial conditions."