tv Bloombergs Studio 1.0 Bloomberg May 29, 2016 12:00pm-12:31pm EDT
>> he got his start as a journalist with the front row seat to steve jobs inner circle and wrote the seminal book on the early years at apple. michael morris tried to try his luck in venture capital. joining the boards of google and yahoo! and then a few years ago took a step back for a rare health condition he has never revealed. >> joining me today on studio morris,irman michael
thank you for joining us. you wrote this book with another center. -- another sir. he is one of the most revered names in football. what drew you to this project as a journalist turned tech investor. i always followed united, not as a raving fan. valley,at silicon working hard to help build sequoia, i was very curious about organizations that had exceeded for a very long time and performed at an extremely high level. particularly those organizations that have been run by one individual. there just are not that many of them. taskedboth have been
with taking undervalued assets and making them profitable. >> he grew up in scotland and i grew up in wales. both of us have an outsider's mentality. ofo, i think a fair amount big work ethic. with is credited transforming this faltering club into a $3 billion public company. what was key to his success? what are the lessons for men and women in business here? >> i wish i had thought about i know years ago because i would have been far more effective. patience, two is a long-term view, three is developing people inside of the organization, particularly young people. and bring them along because if you are successful doing that, you build great consistency and
loyalty and it is easier to instill the sort of levels of performance that you want. >> you boil down the traits of a distinctive leader to just two. obsession and capacity for dealing with people. >> you might look at jeff bezos or mark zuckerberg, these people are obsessed with, at the beginning, the products they want to build. and then, their company. i think the very successful are great about building teams around them. microsoft had a very stable management team. the same has been true at apple. >> you are well known for your time chronicling the early days of apple and you spent time with jobs. you are in favor with him, you were out of favor with him, i
wonder what you learned by watching steve so closely. what makes a good leader question mark -- what makes a he's always >> thinking about the last thing and that is a distinctive hallmark of a truly great leader. the great is never great enough. >> there are a lot of qualities about steve that are so controversial. is the jobs model of that one? >> i'm a huge admirer of steve. sit very easy for people to -- i am no psychiatrist but i don't think any of us really understand the emotional consequences of being put up for adoption and how that affects your life afterwards. what people don't understand about steve, and i'm not trying
to whitewash him, is that this was an individual very capable when he wished of showing great empathy and compassion. steve is the most remarkable person i've met. >> where did you leave it with him? >> sadly, unfinished. polite, on business terms, but that was about it. timeu wrote the famous cover story about the machine of the year and you are a journalist at the dawn of the pc revolution. i want to talk to you about up and coming leaders and technology. , travis kalanick cap herbert -- travis kalanick at uber. >> he is obsessed with his company, for him there is always another hill and mountain to climb. hard tos his team very
do the impossible. he has a very long-term view of his business. energy.ot a lot of he's got a lot of optimism about the prospect. >> what about travis kalanick? >> he is somebody i don't pretend to know well. have you met anyone who isn't controversial who has done interesting things? >> having known three decades of leaders, do you think you have to be arrogant to be successful? >> four decades. lots ofdecades -- leaders make decisions about taking their organization in a direction that perhaps isn't wildly popular within the organization. overometimes, it spills into arrogance. i am different from how i was in my 20's. bill gates, he is very different
from what he was in his 20's. everybody learns a lot in the pursuit. energyerstandable sometimes spills over to arrogance and it tends to get softer overtime. the only silicon valley company that grew from strength to strength as it swap ceo's was intel in the first 30 years. do you think twitter can become the second in history? to bring ar better founder back who feels a real sense of dedication and ownership with the company then going outside and recruiting a higher hand. jack hasn't been bashful about saying that the product of twitter needs improvement. that is where his strengths lie. consumerct is in
>> you grew up in wales and you somehow made it to silicon valley. what kind of kid were you and how did you get here? >> through no grand plan. i went to college in britain and this was the britain of the mid-1970's, not a particularly enticing place if you were a young graduate looking for opportunities. so i was very lucky to get a scholarship here. after that, i was lucky to get a topic -- get a job at time magazine who sent me out to silicon valley. eventually, through a stroke of
great luck, the fellow who had started sequoia, don valentine, took a risk on me. >> what are the qualities you think you had is a good and -- a good journalist made you a good investor? >> i don't think i am a good investor. it is a very humbling pursuit. as soon as you think you are good, you get chopped off at the knees. journalism, though, was pretty helpful because you are often parachuted into a story that you know absolutely nothing about. you have to get your bearings extremely quickly, you've got to deal with imperfect information and then you have to have a point of view or you make an investment decision if you are an investor. you try to meet people, you try to gauge sentiment, i found the
fact that i have been trained to make up my mind about a confusing set of information extremely helpful. hasason horowitz popularized this notion that good ceos have to be founders. -- it is very difficult to tell from somebody's background whether or not they will succeed in the venture business. we have a lot of company founders at sequoia. there is also room for lots of other people to succeed as well. being in the investment business is different from running a company. running the company, we are trying to help these companies as much as possible. the other thing that people miss is we are working very hard on building our own organization
because unless you have that at the heart of everything, you cannot make consistent investment. >> you say that the minute you think you are winning, that is dangerous and sequoia may be the most successful venture capital firm in history. what du due to evolve the firm and stay on the edge? it begins with consistency and showing up for work every day. >> a lot of people show up for work every day. true.is it sounds simple but it is easy to start easing back. not working quite as hard. and not seeking the same level of success. not having the same hunger, getting arrogant, becoming complacent, believing you are as good as -- which is never true. we still act like this in the
belief that we are only good at these things. the next person we hire to become part of sequoia and the second is our next investment. >> what the headline be today? >> gravity hasn't been repealed. the things eventually fall down to earth if they are not properly constructed. >> how do you see this playing out? does this bubble burst or is there a soft landing? >> it is a more rational time the 1999 because i don't think there is a sort of universal feeling that every company is going to be a massive success and people are a bit more discriminating. >> what is that mean? >> they will fail.
it is the law of business evolution. if people get too big for their britches, if money is wasted, if the product doesn't fall -- doesn't fulfill its promise, the companies deserve to fail. >> how protected our late stage investments in this environment? >> many aren't really investments. they are just disguised forms of debt. many of them are very well protected because of the terms that investors have put around them. the ratchets, the liquidation preferences, these aren't equity investments. they are debt. >> is that a dangerous trend? the guarantee that investors will get a certain amount back? >> if the company does not perform, yes. >> how high is the risk now?
it depends on the performance of each company but we've gone through this. where the valuations in the private market are far in excess of the public market. you have one bucket of bubbling water and another rocket of cool water and those two buckets are co-mingled, the temperature will even out. >> what kinds of businesses do you see will be the first to go belly up. >> the businesses that will go belly up our the ones that are run by people who deny reality. and don't use the money that they've raised very wisely and think that there are a whole bunch of shortcuts to success. those things will come across. the companies that are run prudently have got really good discipline about them and have
the right ethical compass from the top where -- and also, they have very distinctive products. >> let's talk about the on-demand economy. you are an investor in instant cart. there are questions about that model. >> we made a lot of horrible the stakes -- horrible mistakes. the consumer demand of this service is through the roof. instacart ist finding today. it doesn't have huge factories or distribution centers. capital't have infrastructure that is required to build a web fan. workforce through these incredibly powerful smart phones it is incumbent on instant cart and it's wonderful founder and ceo to make sure
that all of the economics makes sense. the company is providing a fantastic service to consumers who just swear by it. >> any concern about competitions from uber? >> we are always aware of competitors. companies that successful -- you can't define yourself either them or run afraid. then you are following. acart is a very complicated business that is very difficult for any company to mimic. you now about are alibaba and chinese internet
>> i know you were really bullish on alibaba's ipo last year. how bullets are you now about alibaba and chinese internet companies? bedlam we read about, i will say something that will strike you as odd. i don't think anything has changed about china. consumer demand is very strong. internet companies -- their business is very good. it is strong, healthy, vibrant. we built our own business they're in the course of last 13-14 years. >> quite a robust business.
>> run by some wonderful people. it is no accident that the most valuable internet companies today are chinese because over the next 20 years, there is going to be far more business done between the technology us out in the get u.s. than there has been in the last 30 years. >> what does silicon valley have to learn from china? >> i am always struck by how eager people running chinese companies are to learn about their american counterparts. how frequently they come to the united states, how jammed their schedules are when they come. andsh that the ceos founders of silicon valley companies did the same thing in china because i think we can learn a lot from them. in particular, the
products are different, the services are different, any company aspires to be a global company, china is going to be a very big part of their future. with are seeing airbnb chinese ceo. >> linkedin as well. what does it take for u.s. companies to succeed? >> we try not to make the mistakes we watched others make. the first thing that you need to do is go there and admit you know nothing. you need to understand the market is different and you definitely don't staff your company in china with people from america or europe. you also need to understand that there is a very different work ethic and china. people just happen to work a lot harder. it is this whole new level of competition. >> sequoia is very successful
but you have no women partners. what do you think your responsibility is? >> we think about it a lot. i like to think, and genuinely blind tothat we are somebody's sex, their religion, their background. we probably have more different nationalities working at sequoia then pretty much -- it is a very cosmopolitan setting. the fact that we have embraced ,hina, we have embraced india shows that. the real question, i think, that you might have is why are there not more women? we have many women working in our china business that are you -- then our u.s. business.
where women, particularly in america and also in europe, tend to elect not to study the sciences when there are 11 and -- when they are 11 and 12 so suddenly the hiring pool is smaller. >> some would say you are not looking hard enough. >> we look very hard. we just hired a young woman from stanford who is every bit as good as her peers. what we are not prepared to do is to lower our standards. if there are fabulously bright, driven women who are really interested in technology, very hungry to succeed, and can meet our performance standards, we would hire them all day and night. >> you took a step back from day-to-day operations. how are you doing?
we are you take on new boards. what's it been like? >> i've enjoyed it. i did so for a variety of reasons. i talked about it at the time. i act as, i hope, a helpful team member. i'm not involved in the management of the business. i'm involved with several companies, some of them very young. whenever somebody wants some help, i am more than happy to do it. we have a couple of investments in europe i'm engaged with, but i also have a little bit of time to do things like write a book with a wonderful man who managed a fantastic -- >> you could be sitting on a beach right now. >> i can't imagine anything more boring. the vibrancy of life comes with
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