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Hi, I'm Michelle Kang, an editor at A16Z. And in our new podcast series, Time to Build LA, We're taking a deeper look at investing in company building in Los Angeles. LA has long been known as a mecca for entertainment, gaming and the aerospace and defense industries. But now it's also the third largest tech hub in the United States. Snap, TikTok and SpaceX all have headquarters here.

Investments in the region continue to increase and scores of new founders, venture capitalists, and tech employees relocated here during the pandemic. To celebrate the LA community and the city's growth, A16Z recently hosted Time to Build Los Angeles, an event where we invited LA-based investors, founders, and operators from across a diverse range of industries to talk about company building in LA. In this episode, Mark Andreesen, the co-founder and a general partner at A16Z, and Ari Emmanuel, the CEO of the global sports and entertainment company Endeavor, are interviewed by A16Z general partner Shriram Krishnan about the evolution of the entertainment industry, where it's headed next, and the story of how they first met. What follows is a recording of a live conversation. The audio has been edited and abridged for clarity.

As a reminder, please note that the content here is for informational purposes only, should not be taken as legal business tax or investment advice or be used to evaluate any investment or security and is not directed at any investors or potential investors in any a16z fund. For more details please see a16z.com disclosures.

So we are in LA Tech Week, and we wanted to put together something really special, which represented both everything LA and everything tech. We have somebody who needs no introduction for creating Netscape, for Opsware, for a little firm called Andreessen Horowitz, and kind of tweets a lot. And next up, we have somebody who's pretty much changed the world of entertainment, known as a super agent. You may have all seen him played by Jeremy Piven on Entourage as Ari Gold, but then kind of gone on to conquer everything, from UFC to bowling. If you go to a live event, he's probably involved in it somehow.

So without any further ado, it gives me great pleasure to welcome Mark Andreessen and Ari Emanuel. Give it up. So let's start with the serious stuff. What's the meet cute story between you 2? How did the first, the 2 of you first meet?

All right.

Mark was on the cover of Forbes, and I actually don't remember the article, and It's what I normally do, because I have this phrase that I try and create serendipity. I read the article, and I blind called Mark. I'd never met him before. This time he picked up the phone call. I said, I'd like to meet you.

I read the article. I was, you know, kind of thought it was incredible. I said, I'll fly up. No, he says, no, I'll fly down. He flew down, we had a meeting.

I think in the meeting, I started raising money because we had just started a merchant bank called Rain. He said he would put in money, but he wanted to bring his 2 friends along. 1 was Nikesh and 1 was Egon Durbin. Egon Durbin from Silverlake is my largest investor and that's just the serendipity of life and kind of how I create serendipity and that's how we met.

Now the number 1 rule of business is you never, ever cold call.

I only cold call.

You only cold call. Exactly.

We are in LA Tech Week after all. And the LA Tech ecosystem, the scene here in LA, What do you think?

There's been this long running basically drama story, story arc over the last 25 or 30 years. I mean, my first meetings with the big entertainment companies were in like 1994, explaining the internet, being like, OK, this thing might be a big deal someday. And there was this extraordinarily long period of time where there, in theory, was going to be a convergence. Buzzword literally used to be convergence. And it would literally be a coming together of the 2 great California industries of entertainment and culture and then tech.

And in theory, it was going to happen. In theory, it was going to happen. And then it turned out to be war a lot of the time. And I think it's fair to say the entertainment industry viewed new tech for a long time as a threat. Still do.

And that may still be the case. And then in theory, the tech industry at some point was going to do entertainment. But the running joke was, we're so nerdy and stiff in Northern California, if we made a movie, it would be like the movie version of the manual for a Cisco router, not be the most compelling, exciting content in the world. And so there was this weird shadowboxing thing where nothing ever really came together. And then it feels like probably Netflix was the big breakthrough.

Or is it streaming?

Well, I think it probably started a little bit in gaming. And then entertainment companies that we consider entertainment movie companies thought they could take the IP and they didn't realize that was making billions of dollars and they were not that important in the movie business. But Maybe now it will happen with what Unity's doing and Web 3. So who knows? My sense is the first company that actually did it was Netflix, if we Define that as technology.

And it was kind of a two-part thing, right? Which is, 1 is Netflix all of a sudden is a distribution medium for video, like a new primary distribution medium. The first new 1 probably went since DVDs, probably videotapes before that, satellite TV. But the first 1 really out of Silicon Valley. And then the other was, of course, Netflix then actually started making content.

And to like, I sold the first.

Really? Yeah. What was it?

It was a little show about Washington DC. Somebody got arrested for it.

House of Cards,

for those of you.

The brilliant and amazing House

of Cards.

It

was a classic story. So their stock had fallen because they did the double pricing and you know.

Quickster.

Yeah, all the whole craziness with the DVDs and everything. And then a company I had started called MRC had this treatment, Fincher was attached, HBO was gonna do a pilot, and Ted came and realized, okay, we gotta figure this out, and he put 13 episodes up at, I think it was

$150

million. Fincher went overboard, we needed another $15 million. And HBO could not believe that we were gonna go to Netflix and do that over the brand of HBO.

10

million to 150 million, it was an easy conversation. It was off to the races at that point.

So let's fast forward to 2022, right? Like Netflix just had, maybe not the greatest earnings quarter, right? Is the golden age of TV over? Like Mark just grumbles all the time about he's not finding anything interesting to watch or where do you see content going?

That is like the biggest lie in the world. All I get all the time from them, have you seen this show, have you seen that show, have you seen this show? I mean, it's like, that's a fallacy, and you know that.

Cornucopia, well, okay, is the quality holding up? Yes.

Okay, all

right, okay, All right.

I mean, it depends on, you know, you can get content from anywhere. There's plenty of great content. There's a lot of bad content, but okay. Don't watch it.

How many, how many, how many, how many,

How many things are

on my list for Netflix? 50. How many TV shows are being filmed this year?

I think it's television shows between non-scripted and scripted, I wanna say 900. 900. Probably more.

And 20 years ago that would have been?

In 2011 I want to say it was, no 2009 it was

39, 2011

I think it was 130 and now it's. Right. And then you know the problem is it used to be a drama for linear television would be 2 and a half, 3000000 dollars. Now, an episode, now it's

16

million. That's actually good for me. So I don't know what the bones were about. No bones. Yeah.

What are we talking about here? And you can't get special effects people. There's no studio space. There's some physical issues surrounding all that. That's hopefully why tech and us come together.

Maybe there's ways to figure that out.

So let's get into that. So we had just some examples. The Mandalorian shot entirely in this Unreal Engine power thing. We've had a Star Trek Discovery, 1 of Mark's favorite shows, shot by motion capture in the actors' homes. We had indie movies do great VFX.

Do you think, is there a democratization of movies done by indie filmmakers coming up? No. What do you think? What do you think, Mark?

Well, so a couple of things. So 1 is, Hollywood has had a pattern over the decades of it sort of hits a creative, I don't know, whatever, wall of some form. And then there's a reinvention of the medium of film. And that happened in the 1970s with the new Hollywood. It happened again in the 1990s with the Indies

and Quentin Tarantino. Like, isn't that new? I mean, listen, there's always going to be people pushing technology and pushing what that means. It's happened in the music business. Music, to make an album now, it's almost cost you nothing before it used to cost you a lot of money.

Is it gonna happen in a movie? Yeah, but then there's gonna be filmmakers that wanna do it the old way and on film. So there's no set rules to it. Do I think that because of that, pricing's gonna come down? No, because you're gonna have to put actors in it.

It does take writers. Writers cost now a lot of money because they're doing 3 or 4 projects. So the economics are gonna be the economics. Is there gonna be technology around shooting stuff maybe cheaper and that brings them? Yes, possibly.

And just to answer the other question, so in

1974,

Charlie Bluehorn, none of you know who he was. He was running Golf and Western.

He's in the offer. You can see him now. Paramount just made this TV show, Paramount, streaming about the making of The Godfather. Tremendously good movie. You can learn all

about it.

He goes and says, I think it was 1974, in Variety, which is a trade paper in Hollywood. He goes, the movie business is over. When I start the firm in

95,

they go, the television business is over. And then, I would, at the time, there was 4 networks going to 5. It was gonna be WB and UPN. And I was like, how could the television business be over and they're starting 2 new distribution points? So all I would say to you is, you and I would never pay for ads on direct to consumer.

There's gonna be AVOD. There's gonna be more, if it's now 900, it's gonna be

1, 500

by the time we're done. Distribution's expanding, and you're gonna have to fill the pipes. And if you just look at the numbers right now, people are going to Paramount Plus, they're watching the offer, and then when they're done watching the offer, they get rid of Paramount. And the only way to keep them is either through sports or through new content. And so there's just gonna be more and more content being delivered, And then they're gonna have to figure out the economics because the economics are extraordinary right now.

Okay, I'm gonna ask a question to Mark although I think Ari has a strong opinion on this. So I'm gonna let Mark go first. So best movie of the summer, IMO, Top Gun Maverick, right? This, we had Multiple MCU movies come out. This week we have a LOTR prequel, and I believe a Game of Thrones prequel come out.

Mark, what do you think is happening, and will we ever see original IP again? And then Ari can respond.

Well, so, I mean, okay, I'm gonna drive him straight through the ceiling. There's the system. I mean, there's the system. There's whatever the studio system, or whatever you would call the inheritance of the studio system, and they're sort of quote unquote mainstream. And then, of course, there's this extraordinary kind of, what's the indie scene today?

It's YouTube. It's TikTok. It's this complete, just this incredible long tail in this incredible creative universe. And so you've got this weird thing. So 1 of the hallmarks of the evolution of the entertainment industry, let's see if you agree with this, is the previous medium becomes the content for the new medium.

And so written stories become the content for stage plays. Stage plays become the content for movies. Movies now become the content for streaming services. And so that's part of what happens. And so you bring all these old mediums along with you.

But you also get new creators doing new kinds of things. And they're not making movies. They're not making TV shows. They're making original video short-form content. They're having a completely different kind of relationship with their audience.

And so you've got this completely parallel universe running. And of course, there's some crossover, right? Which is you've got some of those people that then want to sign up with you and then want to become TV or movie stars. But you also have this whole parallel world. Agree with that?

Disagree with that?

I completely agree. I mean, it's the basis of the firm. So my, the George Glenn book, Life After Television, is there's gonna be more distribution than ever. That's why we built the firm, because we get more verticals books, et cetera, social, so 1 form of distribution is social. 1 form of distribution is movies and television.

1 form is betting, gambling. 1 form is games. Yeah, there's just more distribution and more content because we have more and more free time and that's what people want. And there is crossover to that, right? And that's ultimately how we're built to make sure that, we're not perfect at it, make sure that happens.

And when somebody creates an incredible piece of content on social that can elevate up, that's hopefully what happens. But that does not mean, based on your question, there will not be original IP. I went through the whole period when shows out of the UK, right, the office, I put it together, we represented a star in the UK and gave it to Greg Daniels, who I represent, and we put it on the air, that happens. But then there's just Larry David and Curb Your Enthusiasm and that's original.

Well, that was original. When did Seinfeld start? When did Seinfeld premiere?

1990?

Well, Curb's been on for 13 years and then so that was another 9 year and then yeah, I mean, yeah It's about 23 years ago 23 years ago.

So that's pretty I mean, it's great. It's fantastic. It's not

there's tons of original It's

not original in the last

Over whatsapp tons of original shows I'll send you the titles

Just because it's not sci-fi doesn't mean it's not original.

The offer, I just mentioned the offer. You're to the point now where you're making literally TV shows about 50 year old movies.

And you're making TV shows about the starting of the Lakers. Real starting

of the Lakers. Exactly, exactly. So it's like every... But

that doesn't... So now we're categorizing everything that way? Yeah, like

nostalgia acts. They're great nostalgia acts, but they're nostalgia acts. I'm going to send

it to you. I'm going to send it to you.

I'm going to

send it to

the list. I'll send

it to

everybody in this room.

Where's Pulp Fiction? Where's my Pulp Fiction?

He's actually going to probably write his, I hear he's writing his next

last movie.

Hold on, Mark, hold on.

Where's the new 1?

Let me challenge you. If you think this is true, why do you think that is?

Wait a second,

wait a second.

Are there no original ideas here? I'm sure there are original ideas here. How many of them are you prepared to sign up in green light? That's not my job,

that's your job.

All right,

all right, all right, all right.

Okay, we're gonna talk a little bit about the future of content, right? On 2 things. First of all, 1 thing is VR, which I know, Mark, you're passionate about. Like, how do you think VR, or just kind of, you know, some of the more immersive experience, how do you think that's gonna change content?

Yeah, so look, the bold case for VR is really powerful.

Isn't it AR that the bold case is for?

No, definitely not. The bold case is definitely VR. So this is actually a great thing.

We're going to make a bet

right now.

This is a great East Coast, West Coast thing. And Ari is currently channeling the East Coast.

Ari's West Coast.

Well, yes. Emotionally, I'm East Coast. Emotionally. So, what I would say is all of the non-nerds think that AR is the big thing. All the nerds think that VR is going to be the big thing.

Because the non-nerds like like.

I'm

not sure if I should be insulted by

that. Well, you need to decide. And hopefully this will keep you up late tonight as you try to figure out whether that was

an insult.

So look, the non-nerds, they like real life. They like real life. They get up in the morning, the world's a cool place. They hang out with lots of cool people. It's all great.

They have a cool time. And so the idea of a medium like VR that would blank out the real world and replace it with something else seems like it must be bad. And a medium like AR that feels like it would overlay on the real world seems like it'd be good. What us nerds know is that the world sucks. Right?

The world's not like that. The world's not cool like that.

You actually think the world sucks?

Well, I'm sorry. I'm asking you a question.

Do you actually think the world sucks?

Do you actually think it sucks? I think for a... Because you have a fucking good life. Do you think

it sucks? Do you actually think it sucks? I think for a... Because you have a fucking good life. Do you

think it sucks? Do you actually think it sucks? Because if you

think it sucks,

we're all fucked.

I mean, seriously. I mean... I'm leaving.

It's a reasonably good point. Reasonably. No, but for a lot of people in the world, the world does suck. Like a lot of people live in places where there's nothing interesting going on. A lot of people live in places where there aren't interesting people

to talk to.

That's why there's 900 shows on the air.

There are 900 shows they can watch. So look, if the world is not that great, then the idea of the actual medium that actually puts you in a different world is incredibly compelling. And so the actual question would be like, what is the ratio basically between those 2 populations? And I think it's just like obviously true that for most people it's...

You're avoiding my question, does the world suck? I actually think the world's really good. I think there's some bad things that happen. And I think there's probably gonna be a place for, I guess I'm non-nerd, for us non-nerds, and there's going to be a place for the nerds. And it doesn't mean that they can't coexist.

Well, OK.

Let me make the

stronger pro via argument. The stronger pro via argument is that sometimes it gets referred to by people in the field, it's the last medium. And then this is a very provocative statement, because we've had many, many different forms of entertainment media basically through the centuries. But they've all ended up, like the best case scenario like today is that it's on the screen on the wall and maybe it's got the 3D or whatever, but that's what it is. But the point of the final medium that I think people should, in the long run, people should think about is, look, if you can take the entire sensory apparatus, if you can literally be in the thing, then it's like the last...

Because there's no place to go

after that, right? Yeah, but I

don't need to make that decision, though. When it comes, I'll be the first 1 in.

Yeah, for making money. I love it. Yeah. Okay, so next, changing gears, a lot of people here are involved in the theater economy. They may be creators themselves, they may be involved in theater companies.

At Asics and Zee we definitely are. Ari, I'm curious, people with audiences, creators with audiences, they could be sports stars, movie stars, you do a lot of work with them. Where do you see that going? Why is it important? Where do you see that headed?

The interesting thing about our 2 firms is we've built a business that it started out in the movie and television business, and then it went to non-scripted books, music, theater, then we went to sports, went to fashion, art, bedding, taste, meaning food, And then we built layers, you know, a licensing business, a commercial sponsorship business, so that when we enter somebody's life, whether that be cricket, or whether that be an actor or an influencer, we have the ability to kind of take them global and also take them across all the things that they want to do to build a business. And whether that be Mark Wahlberg or Dwayne Johnson or whomever to a powerful influencer. And so they are all realizing the value of their brands and that they have the impact they can do. And we talked about this this morning. You have a big actor, a big actress, or a sports star, you know, they love what they do in acting or in the sport they're in, but they also realize that's kind of like a commercial that enables them to make money across all these other places.

And that's the difference, I think, that we've realized. We started this thing called talent ventures you know we we invest off our balance sheet to make sure we're kind of enabling certain things that we can influence and that's where all these people now stars or people of influence or that have social followings, realize the power that they have in all this downstream or upstream economics and brands. And that's kind of what the firm is now built to do. We call it architecture, how we introduce that across platform, and that's what we do. I don't know if that answered your question.

Well, I think it does. It's really about the power of having a large audience. Speaking of which, Mark, you have a million followers on Twitter, 2 questions. 1, what do you think of just the power of having an audience as a creator? And where do you think it's headed?

When are you going to tweet again?

I had to get back

into it. Who wants to see Mark tweet again? Yeah. Woo! Woo!

Woo! OK. Sure. Some people are like, I don't know about that. Like, yeah.

There was a lot of hesitation. 000A lot of hesitation. A lot of hesitation here up on stage. So look, I think there's a really, so this is where, again, I would like be a super bull on the following. I think sort of the social networking revolution, the idea of sort of having these sort of direct brands, direct followings through social media, I think is probably still significantly underestimated.

I would go so far as to say I think we might be in the final era of corporate brands. I actually think this might be it for corporate brands or product brands because fundamentally if you think about it, why does the corporate brand exist, right? Or why does the product brand exist? It's because from the era of mass marketing, mass production, mass media, where you had these very thin, narrow pipes to be able to get messages to people. So you had to run TV commercials, and you had to put a brand on things and put it on the shelves.

But now, in this sort of peer-to-peer connected world that we have, where you can pick the people you want to follow and have this kind of parasocial relationship with them and kind of be part of their lives, all of a sudden, it's like, OK, now I can actually have a relationship with a person. And a relationship with a person will always trump the relationship with a company. And so I actually think that, I think basically anybody with a large scale following is probably dramatically underpunching their weight today in terms of what's possible with that.

I agree with

that. So OK, here's a good question. So I went on Twitter basically because I wanted to chin a million Twitter followers. Elon's up to 100 and probably 20 million Twitter followers, something like that?

A lot of questions are about numbers. I don't want to get in trouble.

So I am 1 slash 120th of an Elon, right? Like just in terms of follower count, right? So I'm like, I don't know, I'm like 12 micro-elons or something. But like our

12

micro-elons, is that a proportionate thing?

The question I have for you, if you actually put your mind to it, How many do you think you can get?

I don't, well this is the thing. I think these guys have laid out a playbook where if you really put your mind to it.

I think you could get up to

50.

I think I probably could. Now, I think it's, I just think this is a playbook that actually hasn't gotten right. Everybody, Everybody in social media today is still experimenting. We don't actually have

a good book yet. The old guard is you have to protect the brand, you have to really kind of not oversaturate. They have written completely a different, like, go for it, doesn't matter. And there is consequences to that.

Well, maybe we'll see you on social media someday.

Yeah, maybe.

So the title of the session was ostensibly Art of the Deal, not regular people. And both of you are legendary for deal making, right? So Ari, what do you now know about buying a company, making a deal, because a lot of people here are in VC, they're founders, you know, and someday they want to be where both of you are. What do you now know about making a deal that you didn't know when you got started? And you've made some big ones, UFC probably 1 of the biggest ones.

What do you now know, how do you go about it?

Well, you know, listen, I would say to you, most of the time when I'm trying to either buy a company or make a deal, and the hardest thing for me, because I do have ADHD and I just want to get, you know, you do have to know how to shift gears. Like in the television business, when I was first starting out, you went from first gear to fifth gear, and then, you know, because you had seasons, and by May, you knew the show was going, the movie business was a lot slower than that. Buying companies, running a company, you really have to slow it down and you actually have to show up. I think

90%

of, you come with all the baggage, good and bad, but showing up, coming up with good ideas, and being present, and I'm in the middle of 1 right now trying to get a deal done, you have to be relentless.

So talk about it, because there are some stories about how long you've courted some of these companies, how many phone calls?

Yeah, a lot, I would just say. But you just have to be relentless and you have to be creative in your approach because I can be exhausting. I know. So when you go at them, you have to kind of be, bring some charm to it and everything. But you have to just keep on showing up.

Because, and that takes a lot of emotional endurance. And I think it's the hardest thing that we all have, especially with social, it's all interact. And you have to come with great ideas of where you would take it. Because on the UFC deal, none of the numbers on paper worked out at the beginning. And we were in the middle of it, it was 9 days of hell.

My phone was on my chest, and just solving problems. And then Brexit happened, the banking system fell apart. I mean, it was a disaster. But, you know, and in the middle of it, 1 of my partners said, are you sure you wanna do this? And I said, no, I'm not sure we are doing this.

And that's just what it takes. It just takes hanging in there, having emotional endurance. And when you have to get on a plane and do the things you have to do, you just have to do it. It doesn't matter how tired or how exhausted or how emotionally trying it is. And I think that's the hardest thing to do kind of when you're starting a firm, getting that emotional endurance to kind of weather those storms because they all happen to us.

In the 27 years, COVID was horrible, 08 was horrible. I mean, you just have to, that's kind of the secret sauce if you can have that emotional endurance. And it's also in a deal, in trying to buy a company or build a company.

Which may be a

good segue into this. I mean, everyone's super happy here, but I think a lot of people, what's on top of mind is the market. Everything is down, you know, everything across the board is down. A lot of people are doing flat grounds or some raise money. Or if you're a founder, you're dealing with laying people off.

And so you folks have been through a lot of market cycles, you know, been through all of it, you're still your own companies. When people who are kind of dealing with this and maybe having sometimes like a really tough time, how do you think they should approach it from a mindset perspective? What advice would you have for them? Maybe Mark,

you go first. So Sean Parker had the best quote of all time. And I'll just prepare you ahead of time. Every audience has hated this quote, so I'll just prepare you for that. Sean Parker had the best comment on what it's like to be a startup founder.

He said, being a startup founder is like chewing glass. Eventually you start to like the taste of your own blood. Yeah. And it always gets this exact reaction. That's true, though.

And he's right. It is brutally difficult. And I actually think it's, we live in a culture in which people have like, popular culture is like these very positive interpretations of how incredible it is to be a founder and then there's all these negative kind of hip pieces and so forth. And then there's just kind of the reality in the middle. And the reality in the middle is it's always really hard.

There's always a lot of really hard things going on. And then there's also, I kind of rail on this a little bit, there's this, in the Valley in particular, there's this kind of fail fast kind of culture, and something's not working, give up quickly. There's a little bit of sense in certain circumstances, but by and large, it's kind of the opposite advice. You tend to find the great founders following, which basically is like when the going gets hard, the answer generally is just work harder and fight it harder.

That's true in entertainment too. I mean, Greg Daniels created The Office. Jeff Zucker, he did 6 episodes. Jeff Zucker said, and usually after 6 episodes, you get 22 episodes.

You kind

of go in the mid, at the time you went into the mid-season pickup and then you'd get 13 or you'd get

22.

And Jeff Zucker called him up and he said, I'm just gonna give you 6 episodes. And he lost his mind and he thought he'd failed and he's 1 of the great writers. And I said to him, just stay in the ring. He goes, I'm not doing 6 episodes. It's such a sudden time.

I said, let's just do 6 episodes and see what happens. And 6 episodes led to the season of The Office. And the same thing's true with Seinfeld and Larry David who I represent. I mean, that's just what it takes. You just have to stay in the ring, take the beating, and just keep on going.

There's plenty of times in my life when that happened at the firm. Partner was stealing from me, we had no money, went into the bank account, paid all the employees and didn't think we were gonna make it to the next day. And that's just what, I kind of enjoyed my own blood.

So you wrote Seinfeld and then obviously Curb. Seinfeld was a huge hit right out of the gate. Is that how it went? No.

So it was on, I want to say, Wednesday. When they put it up and it got, you know, you go through testing, It said, this is about nothing. And first 6 episodes didn't work. Brandon Tartikoff was in the hospital who had leukemia,

his first bout. This is the executive response.

He was the head of NBC.

Sort of guy who was protecting it.

And he then saw the episodes and he said, you know, let's put the reruns on Thursday night behind friends. It then, the ratings went up. They then ordered 13 episodes. They wanted to, I'm going to screw up this, there was a problem with Larry David, because he didn't want to listen to their notes, they brought somebody in. That man gave up his points, because he said, you know, this show's for the snow bear.

Gave up, I think it was 15 points,

which was. On Seinfeld.

He said, and he took for the 15 points, I think, $250, 000. The story's probably wrong.

$250, 000,

and they were worth, now, hundreds of millions of dollars. And they then put it out Thursday night. Huge hit. You know, and.

But very tenuous at the beginning. Oh my God. Like even sign, bring it up just because even sign film.

Yeah, it

was about nothing.

Right, yeah, yeah, yeah. So you go back, and by the way, it's the same thing with a lot of these big successful companies, like in the very beginning. Well, the other thing that just gets buried in the history, you can sometimes get it out, But the other thing that gets buried in history is this, for each of the great tech companies, there were almost always moments where they would have or almost did actually sell the company very, very, very early on. Really? And some of these stories are very famous.

You've heard a number of these stories. And Netflix almost sold to Blockbuster. There were all these points in time where- Facebook to Yahoo? Facebook.

Well, Netflix got lucky because Blockbuster and Viacom, because he owned a big chunk of it, put so much debt on it. They had all the digital rights. They just couldn't afford it. Viacom ran into all the trouble when they were splitting the company up and everything else like that. So.

Well, Facebook actually sold to Yahoo. They actually had a completed deal. Really? Yeah, they actually had a completed deal. They had a completed deal at $1 billion.

And then the CEO of Yahoo at the time, the financial crisis hit, and Yahoo reduced the price. And that gave Mark the latitude. Obviously you need to adjust for the down market. And that gave Mark the latitude to walk away. And actually the other funny part of that story is at that time, well it's even crazier, at that time the internal Yahoo deal deck on buying Facebook, this is 2008, actually leaked to the press.

It's actually public, you can still find it online.

It's actually

ran on TechCrunch, you can Google it, you can find it. So it's the internal Yahoo projections for Facebook's future earnings stream. And the overwhelming reaction was, that's insane. You know, Yahoo has lost their mind. There is no way that this thing can ever make that level of money.

And of course, it undershot ultimately by like 100x.

You know what the value of...

Like Yahoo was being like crazily conservative. You know

what the value of at the time when Disney bought Cap City's ABC, what they valued ESPN at?

0. 0.

It was at the time before linear and cable went to nothing. It was at the height probably worth $100 billion, $50 billion.

So it was the theory there that just was it just not far enough long, or was the theory that watching a TV show about sports?

Exactly. It wasn't far enough along. Who was going to pay for sports?

So these things, anyway, the point of the story, these things are super tenuous up front. Success is now, it's almost never the case that it's like, OK, this thing is going to be a slam dunk success, and then it's a slam dunk success. It's almost always just a continuous fight against people who just literally don't believe.

And

the interesting thing about the Yahoo Facebook story, and this is very public now, is that a lot of the Facebook exec team at the time were not happy with not selling to Yahoo. They really wanted to

sell. Enough time has passed. People have talked about this.

100%

of the Facebook executive team at that time wanted to sell. Really? Except for Mark. Yeah, it was overwhelming inside the company.

I mean, my story is, we start the company. 3 months in, I'm gonna say a bad name now.

Oh, wow,

okay. So, I get called into Harvey Weinstein's hotel room with my 3 partners at the time. And he says, I've made a deal for you to go to William Morris. They're gonna pay each 1 of you 2 and a half million dollars. Now, we had no money.

I wasn't taking a salary. We were getting sued. It was a disaster. And you'll go over there and they'll buy the company. Asshole, me, says to him, what are you fucking talking about?

I'm gonna buy them 1 day. Cut to 15 years later.

Did all the people you were in the room with that day hang with you?

Except 1, he left at the merger. And we merged slash took them over.

So, we're almost out of time. I want to ask 1 last thing to both of you. And I know both of you hate this, but I'm going to ask this anyway, right? So I'm going to start with you, Amar. What is 1 thing over the many, many years you've known Ari that you've learned from Ari, and then vice versa?

But we'll start with you.

Well, look, the big 1 is that Nietzsche has this term, will to power. And so I think that would be my, just like, and you've seen it demonstrated in the stories today, which is just an overwhelming determination to get to the objective and to not let, another way to describe it is Ari leaves an Ari manual-shaped hole in any brick wall he encounters, including my calendar, my phone call list. And so, yeah, just like at the end of the day, like there is no substitute for sheer willpower and determination. And so I think he has a lot to teach about that.

Definitely that phone calls are not as important.

Oh, come on, come on, give us something real.

No, listen, he's built 1 of the, we actually were just talking about this at lunch at his house. You know, he's built a company that he's realized, he continues to shift how he thinks about the world, and he's constantly curious about things that are happening in the world. And his capacity, and I think I have a pretty big capacity, it's not even close to his, to absorb all these different worlds and then take things from and incorporate into his business is extraordinary.

On that note, this has been...

Thank you.

Amazing. Million Target, Mark with the green light. Thank you. Mark and I.

Thanks for listening to this episode. For more information about time to build LA go to a16z.com

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