The Knowledge Project #50 Josh Wolfe: Inventing the Future

  • What does Lux Capital do? We find brilliant people and back them. Then we get really lucky. 

  • Typically we are drawn to people with irreverence and slight arrogance: They have a conception of the world that some people would conflate with arrogance of the highest order. They say this is the way the world should look. I disagree with the consensus.

  • What is really important and what really matters is understanding human nature: Technologies change, businesses change, and markets change. Human nature is constant.

  • How to get an edge: Understand what everyone else looking at. Then find the white space of what people are not looking at. 

  • You could make the argument that venture capital is the most lemming-like field: One company gets done and then there are 100 followers. We view ourselves as contrarian. We want people to agree with us. Just later. 

  • Somebody that is a great storyteller is good for a startup because they can recruit really well: We call it the pampers effect because you are wetting yourself and saying I really need to join this person. 

  • The need for a stoic mindset: The world is full of randomness. So many things that have happened in my life, for better or worse, were largely out of my control.

  • A framework of probabilities I call 100 / 0 / 100: I’m 100% certain that Lux will be investing in the craziest, cutting edge stuff you can imagine. I have 0% certainty what those things will be. I’m 100% of where I will find them - at the edge of our already cutting edge companies. 

  • I get information anxiety: I not only read what everyone is reading - that’s table stakes - The NY Times, WSJ, Washington Post, etc... I’m also looking for what the editor put in the back of the paper. What did they decree to be less important? What if I have a different weighting of its importance? That is the meta insight. 

  • A framework on information processing I call Fitzgerald, Twain, and Schopenhauer: Each of these literary giants has a quote that defines where we should direct our attention. 

  • F. Scott Fitzgerald quote: The test of first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time and still be able to function. 

  • Mark Twain quote: It ain’t what you don’t know that gets you in trouble; it’s what you know for sure that just ain’t so. 

  • Arthur Schopenhauer quote: Talent hits a target no one else can hit. Genius hits a target no one else can see. 

  • I’m a psychotically competitive person: I feel most productive when I think everyone else was sleeping. 

  • A great way to find opportunities: Ask what sucks? Almost everything we use was invented by someone first saying this sucks. I have a better idea.

  • There is a broad set of phenomenon that I call directional arrows of progress. Here is an example: Take a directional arrow of progress in energy. We went from carbohydrates to hydrocarbons to uranium. The undeniable arrow of progress there was more energy density per unit of raw material. These arrows of progress will continue regardless of who the actors are. They will continue regardless of who the companies are. 

  • Book recommendation: Tribal Leadership: Leveraging Natural Groups to Build a Thriving Organization  

  • A great idea from Charlie Munger: Sell yourself the best hour of your day. Block it off and allow no interruptions.

  • What is your superpower? Very high expectations and ambitions.

  • Great quote: The best-performing companies have no comps because they are doing something that no one has done before.

  • When communicating with co-workers: You waste so much time if you are not direct and honest. 

  • A good mental model for making decisions: Have a hall of heroes [Munger, Buffett, etc] of people who you think make good decisions. Ask yourself what would they do in this situation. You can get this by reading. You have all these dead and living people whose ideas and decisions you can study.

  • Full podcast here.