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Product is Humbling: This week, Paul Ford and Rich Ziade talk about John Carreyrou’s Bad Blood: Secrets and Lies In a Silicon Valley Startup, a book about “what can go wrong when you believe stuff”. Drawing comparisons to Wild Wild Country’s Baghwan and the late Steve Jobs, this episode discusses the founder of Theranos’ charisma within the culture of Silicon Valley. Was the failure of Theranos to deliver its product a case of collective megalomania, mass hysteria, or simply a refusal to say “I don’t know?”


Paul Ford It hurts. I never wanna start another business in New York City. My God! It’s like somebody just comes by with a vacuum cleaner to suck your wallet out. It’s—

Rich Ziade Can I tell you, though? I—I—I—it’s—I mean—

PF I do love it. I love it.

RZ If you love the big leagues, where you gonna do it?

PF No, I know. We did it and it’s good.

RZ [Crosstalks] You want Bethlehem?

PF But you know they’re gonna fight you [laughing]—

RZ Nothing wrong with Bethlehem, Pennsylvania.

PF No, it’s where baby Jesus was born [laughs].

RZ [Laughing] Not [music fades in] that Bethlehem [music plays alone for 18 seconds, ramps down].

PF You read Bad Blood yet?

RZ Oh my God, it was so good.

PF It’s pretty satisfying, right?

RZ It’s—it’s like something really delicious but not just delicious but you want it to stay in your mouth a really long time.

PF Like good chocolate.

RZ Good chocolate.

PF And nice—not too pricey a wine. But like a good wine [music fades out].

RZ Before I had the means like the way a White Castle burger sort of melted into the bun.

PF Yeah.

RZ Was just incred—and then—

PF [Crosstalks] The chee—the fact that—

RZ—the onions had that sweetness.


PF The fact that you can’t differentiate between the cheese and the meat.

RZ Exa—or and the bread.

PF Mm hmm.

RZ And then you had those diced onions which gave it that sweetness, which you don’t understand that when your 14.

PF We should bring this back a little bit: Bad Blood is a book by an author named John Carreyrou.

RZ Carreyrou?

PF And it—it’s about Theranos, the company that the CEO was Elizabeth Holmes.

RZ It’s a—it’s a Silicon Valley startup.

PF Yeah and it did blood testing. It had devices that—it was supposed to have devices that would go into like a Walgreens and you could go prick your finger, a little bit of blood would come out and it would do all these tests. And that’s great cuz—

RZ [Crosstalks] Versus—

PF—no needles.

RZ Alright, needles and—

PF Or little tiny needles. Just real—real cool and totally. This is a world of TED Talks and big investors and everybody was really into Theranos and it turns out it was not great.

RZ It was bullshit.

PF It was a nonsense company. And you know what’s tricky, reading the book and it’s definitely, you’re lookin’ in the mirror at some parts of this. Like you’ve met people like the people in this book. And so there’s a few things that happened. First of all, it’s just—it’s hardware instead of software. And it’s health care [sure] hardware instead of software [sure]. And so, you know, in software we can make big promises and never deliver.


RZ Have an awful bug.

PF And everyone’s like, “Well, it’s a bad bug and you erased all the data,” but nobody’s—nobody’s dead [Rich laughs]. And—literally like, you know, when we’re doin’ this stuff, a lot of times if something’s goin’ real wrong you’ll say—

RZ No, it’s egg in the face.

PF “Nobody died.”

RZ Yeah.

PF It’s embarrassing.

RZ Well you gotta get on with it, right? So—

PF You gotta fix it.

RZ Right.

PF But in this case, in medical stuff, you can’t do it after the fact.

RZ No, no, no. You’re playing with people’s lives.

PF The journalist who reported it out really went deep at the Wall Street Journal and dug deep into this company and found a lot of problems and, boy, did they come hard at him to keep him from telling this story but what you sense is they just kept tellin’ themselves, “You know, it’s right around the corner.”

RZ Yeah.

PF Like I think that there was a tremendous amount—there was deception of the public . . . which is inexcusable. You cannot deceive the public with your blood product and tell them that, you know, “Come to Walgreens and we’ll test everything and we’ll tell you what’s wrong with you,” when you can’t do that. That’s very, very—

RZ Probably should go to jail.

PF That’s a terrible thing to do.

RZ Which is a possibility but—

PF Just a flat out terrible thing to do. That’s right. But there’s an element of self deception throughout that I really found fascinating cuz that’s a big part of software like you just—you kinda lie to yourself about how easy it’s gonna be.


RZ Well there’s this wonderful Bill Burr skit. Bill Burr is a comedian.

PF Yeah, you love him.

RZ He’s a knucklehead. He’s like just a jerk from Boston and he’s just angry at everything and, frankly, he looks like Socrates next to the other stand up comedians on Netflix [laughs]. So, so there’s that.

PF Yeah and the other—he went after um Steve Jobs in one bit and it’s great.

RZ That’s the thing and what he went a—the way he went after him actually made me—reminded me of Theranos which was . . . ok, so he’s put forward like this icon, he’s a genius. But what did he do? He walked around with a fruit in his hand, and he’d say, “Make it smaller. I want a—I want the screen—I wanna use my finger. And no, you can’t add any buttons. Go figure it out.”

PF No, Bill Burr doesn’t know what product is—he’s just like this person did nothing, he wore a turtleneck.

RZ He wore a turtleneck.

PF And he yelled at everybody.

RZ Right. So I think—

PF Now, we have to—we have to be mindful: Bill Burr aside like Steve Jobs came up in Silicon Valley; he actually did—he knew what assembly programming was, he did some—

RZ He did! And he got in there.

PF Yeah.

RZ He saw the problems and sat next to you. And he did get in there.

PF Clearly he knew like what the limits of possibility were and he would just shove people right up to [through them]—sort of past that limit, right? [Rich laughs] Like the anecdote—there’s an anecdote about the iPhone where he—they told him it couldn’t be any smaller and they handed it a prototype.


RZ Yeah.

PF I don’t’ know if this is true or not but he dropped—theoretically he dropped it into the aquarium in his office. Cuz of course he would have an aquarium.

RZ Right. Yeah.

PF And uh and bubbles came out. And he was like, “Well, there’s clearly still room.” [Rich laughs] Right, so that—

RZ By the way, he killed some of the rarest tropical fish—

PF Oh yeah five sharks died that day.

RZ—when he threw that phone [laughs]—

PF That’s ok. They just sucked down some congoleum arcinite.

RZ Right.

PF And also, Elizabeth Holmes really copied Steve Jobs down to the turtlenecks. She believed in him.

RZ His image.

PF Yes.

RZ She copied his image down to the turtle—and I think what she believed was, and I think this is Bill Burr’s point which is, look: I’m gonna go and get a bunch of money, step one. [Mm hmm] Step two: I’m gonna hire really smart, talented people, which he was able to do. A lot [mm hmm] of PhDs; a lot of thought leaders in [mm hmm]—in medicine and the like. And I’m going to be a figurehead.

PF “I’m gonna be the leader.”

RZ And I’m gonna scream at them. A lot.

PF “I’m gonna be the leader who’s gonna—“

RZ Just like Steve.

PF “I’m gonna bring this together. I’m gonna make this happen.”


RZ Look, beyond Steve’s genius, and he’s a genius, let’s acknowledge that—

PF Yeah.

RZ He was a tyrant. He was brutal in what—in how he tried and what the tactics he’d use to try to get more out of people and she figured, “I’ll just do the same thing. I’ll just—I’m not gonna do any of it. I can’t do it. I mean I’m Steve Jobs. I’m gonna walk around and just scare people.”

PF Now, granted, he had built the industry, you know, a big part of the industry and had a great sense for consumer product and it was demonstrable. He built careers as he went along. She came in very young, in her twenties, and sort of was like, “I’ll do that too.”

RZ Oh it breaks down. For sure.

PF But she hadn’t—she hadn’t done the homework, right?

RZ Exactly.

PF The—the story it’s just like—there’s a lot of narcissism involved; there’s a lot of people—there’s a lot of old Republican dudes involved—

RZ This was weird, too, right?

PF Because The Hoover Institution which is a sort of right wing sort of very classic think tank associated with Stanford. She—

RZ Well as I like to say it’s the retirement home for Republicans.

PF She’s like their bright, young granddaughter or something.

RZ If this was real; she [yeah] would probably be a modern day—

PF Oh—

RZ Joan of Arc?


PF We’d be sitting here like just talking about—

RZ I mean, for women in business.

PF Yeah!

RZ She’d be an icon.

PF That’s what’s brutal about this actually—yeah.

RZ It’s tough. Yeah.

PF It really sucks because it was like here was this really weird one-off story with this very like smart, clever person and it turns out to be a fraud.

RZ Yeah.

PF And that part is very depressing cuz it’s also, you know, there was a point where there were billions and billions of dollars in value and this was gonna be a great blood testing framework and [yeah]—and it was also cool to see Silicon Valley connect to pharma and to all like—it was like, oh woah! This is Brave New World. And I remember reading about it and feeling a little bit left behind like, “Oh is that the way it’s going?”

RZ Yeah.

PF “Oh we’re gonna still build software; it’ll be ok but like wow maybe—maybe we should all get into blood testing!” And—

RZ Well, Silicon Valley gets real excited over disrupting status quo, right?

PF It does—

RZ This was the pitch.

PF Except a lot of times disruption is just a new middle man [Rich laughs]. You know? A lot of times disruption is: “We’re gonna get rid of supply chain engineering and [yeah] drop blockchain in!” And you’re like, “But the—”

RZ “Calm down.”

PF “Is that good for me?” And they’re like, “No! [Rich laughs] But I get five percent of every transaction,” and so this was actually like not—it was genuinely disruptive like don’t go to the—to Quest Diagnostics.


RZ It’ll be in the ho—that’s another thing worth noting: this wasn’t just about new hardware at Walgreens, this [yeah] was gonna be in your house.

PF Yeah.

RZ This was gonna be next to your blender.

PF It’s gonna be for diabetics, it’s gonna be for everyone. So, there’s a lot of ambition and hope that got connected to this and—and—

RZ Without a doubt.

PF—doctors got involved and [scoffs] ‘Mad Dog’ Mattis was involved and so there was a really interesting moment, too, where—which I thought about a lot which is she went and got Chiat/Day which is the ad agency that did a lot of Apple’s advertising [yeah]. So of course she—they went for that for Theranos and there was a big part of the book about trying to get the website out, and of course it’s—it’s a disaster cuz they’re just trying to get the website up [yeah] like that’s—that’s the first part that’s hard [right] is that Theranos has a very controlled image and they have a lot of stories they wanna tell. But also they keep having to kinda—everyone’s starting to realize that the marketing message doesn’t correlate to reality.

RZ Right.

PF And it’s one of these moments where—

RZ Down to like language that’s—

PF Right.

RZ—scrubbed on the site.

PF Right and so it’s this very tricky thing where the agency isn’t quite sure what its ethical responsibilities are because they’re about to put health information up. Now, now, legally, you know, we have this too. We’re indemnified. If somebody says, “Can you do this for us?” And, you know, they give us some copy to put on a website. We’re indemnified. That’s on them.

RZ Yes.


PF Like we don’t—we can’t take responsibility for that cuz we don’t have the domain knowledge in a lot of sense.

RZ Yeah, it’s just—it’s just you were talking about stuff that is affecting people’s health and lives that even as an ad agency or a marketing agency, you can’t help but like, “Uh can we just talk about this for a second?” [Laughs wheezily]

PF “I don’t know if we want this on the—” Well, cuz you go—I mean it’s really like this is dangerous.

RZ Right this is—

PF Things like that that are bad for the world and bad for business and you’re like, “Uh oh.”

RZ Right, right.

PF And it’s really tough like you can see the people who are in there who are just like the people who are supposed to get the website up at Chiat/Day [chuckles].

RZ Yeah, like, “Uh what—the language is kind of aggressive here.”

PF This is where—and you can just imagine that 500 million email chain.

RZ Yeah.

PF Of like, “Well, about if we said ‘sometimes’ instead of ‘always’?”

RZ Right, exactly.

PF Or like ‘frequently’.

RZ You try to get in the head of the founder here, right? And you have to wonder is the founder terrible and self aware and has just decided, “Ok, I’m evil. I know what I’m doing is evil.”

PF No. No.

RZ Or is this someone that just got lost and just drank their own Kool Aid and just—


PF I think this is—So I think that you’re surrounded—is a bright talent and obviously gifted person.

RZ She has, like, what was that? Back to Netflix. Wild Wild Country, what’s the name of the dude everybody worships?

PF Oh Bagwan!

RZ Bagwan. But nobody said it. He never said anything, right? He just had that charisma.

PF I know but that was—that’s hard to do too. I’d love to do that—

RZ Do you consider him intelligent or do you consider—

PF Yeah! Oh no, he was brilliant!

RZ Ok.

PF Yeah, I mean I would love—

RZ So you’re really—you’re measuring this against [Paul sighs] how people—

PF Could you imagine if we didn’t have to do this podcast and we could just sort of sit here and look at people and they would—

RZ Like take LSD and just—

PF And they would get their work done. Do you know how great that would be? If I could just—

RZ Oh! Oh I see.

PF If I could just look out the window and like look at the design department and smile and sort of like nod.

RZ Is that genius?!?

PF Sure, why not? There’s all kinds of intelligence. You don’t just have to yell at people—

RZ You’re right.

PF—in Bay Ridge [laughs].


RZ I—I think [chuckles] I think you’re right and I think—I think what you’re talking about is this sort of trait which is the ability to get people to emotionally connect—

PF Yeah.

RZ—with whatever it is you’re doing.

PF Well, this is—

RZ Whatever it is you’re about and—and to just almost become drunk on it.

PF There’s a terrible truth, I can’t remember, whoever wrote the big book on management in the seventies, I can’t remember it’s Tom Peters or Peters Toms or something like that [In Search of Excellence by Tom Peters]—

RZ Uh huh.

PF Um just said at one point that, you know, all management is manipulation [Rich exhales sharply]. Which is a brutal truth . . .

RZ [Stammers] Let’s use persuasion.

PF No. It’s—I mean just like why? Why sweeten it? It’s—it’s about convincing people that the things that you find to be in the best interest of the organization are also in their best interest. Anyway, this woman is obviously extremely talented because she did something I’ve never done which is build a bazillion dollar blood testing company. Now, granted it was—

RZ She didn’t but [Paul chuckles] go ahead.

PF But still like the thing that she pulled off is very hard. The fact that [it is] there was no product makes it almost more impressive.

RZ Yes.

PF In a—in a evil way. And there was a product it just severely under-delivered on what was promised and they were doing a lot of like testing—

RZ Well this was the fir—I have two lessons that I took out of this book and, you know, as a non-practicing attorney, by the way, we should talk for a minute about how attorneys can turn and be just incredibly nasty.

PF This was what the book ended up being about the way that litigation affects the truth [chuckles] about business and how a business is run and operated at a certain scale.


RZ And how you can use it as an intimidation tool.

PF You know this drives me—

RZ “I will ruin you.”

PF Mm hmm.

RZ And the thing is you’re walking out of there and you’re like, “Listen, you’re gonna sign this and if you say one thing,” cuz you’re walking out of there knowing that—that—

PF You’re quitting—

RZ The scam was known years before it came out.

PF Yeah.

RZ It’s just as you’re walking out the door to say, “Hey, listen, uh you know, we’re rigging old blood testing machines and we’re lying to everyone. If you mention this to anyone, I will ruin you.”

PF I don’t even know if it was a scam. I think it was very spongy and people believed whatever they chose to believe—

RZ No, but you had—

PF They created an environment in which people could believe what they wanted and then you go, “I—I can’t do this anymore. I need to quit.” And they would go, “Clearly, you’ve lost the thread here. You are in big trouble. Over here we’re doing this amazing work and you’re telling us that you’re gonna just walk out on this. You’re gonna sign this document.”

RZ Right.

PF “Or we’re gonna ruin your life because we’re doing something here to change the world and you just came in and said that you don’t want any part of it,” and like if you’re a typical human being, without a lot of legal background, you’re—that’s like a full blast into [oh absolutely, absolutely]—into your brain. You’re like, “Ok, whatever. I’ll—I’ll sign whatever. Please don’t kill me.”

RZ Yeah, “Leave me alone.” Yeah.


PF Yeah.

RZ Which I, you know, the—the Wall Street Journal reporter who chased this story had a real hard time getting people to kind of comfortably take baby steps towards him [but this is where jour—] to let him know what’s going on.

PF Journalism is great cuz all the same lawyers came to meet with the Wall Street Journal.

RZ Yeah.

PF And the journalists were like, “C’mon!”

RZ Yeah.

PF Because they don’t really have a dog in the fight. And in fact it’s even worse, you’ve got Rupert Murdoch over there investing.

RZ And he owns the Wall Street Journal.

PF And he owns the Wall Street Journal and it still didn’t matter. He wouldn’t mess with it.

RZ No, no. He can’t, right? The Wall Street Journal like any sort of formidable publishing brand—

PF You lose all your talent.

RZ Oh no it has a self destruct button, right?

PF Yeah.

RZ Like you can’t do it. If that ever got out that he—he like muzzled the Wall Street Journal cuz he owns it. It would’ve been the end of The Wall Street Journal.

PF Well, I think everybody kind of hates Rupert Murdoch but he keeps going partly because he creates these environments.

RZ Oh! He knows the rules. [Yeah] He knows the rules. And that was that, right? And also it was like a—a tax drawdown [oh yeah] [laughs] for him. It was like nothing. It was like, “Oh I have some—I could put this against some profits.” [Laughs]


PF [Crosstalks] “A hundred million dollars. Whatever.” But yeah, no, so lawyers just show up and this is—I joke about this but [it’s brutal] one of the—one of the good things about starting this company with you, you know, I came out of editorial and media and people don’t know this like everyone’s like, “Oh an editor well your job is to get really good language into the magazine.” Your number one job in any role where you’re dealing with the public is to reduce litigation risk. People don’t get that. Like [yeah] my job has often been, you know, when I’m writing; when I was an editor; when I’m doing anything you think constantly about the attack surface for litigation.

RZ You’re no babe in the woods, right? You have a lot of power.

PF You do!

RZ You could ruin a company; you could ruin a person with an [you can ruin a career] article.

PF And there are rules; you need sourcing; you can—but the key thing [chuckles] is you could still get sued. At any moment.

RZ You can sue anyone! Cardinal rule!

PF And this is why I really like—one of the great things about filing this company with you is that I always have council [Rich scoffs/laughs]. Swear to God. I mean people don’t—you know all the—all of our—

RZ Or it’s a great partnership, Paul [laughs].

PF No, but no, all of our contracts go through you, right? Like that’s not me—I’ve seen a lot of organizations that get in trouble because they get a template and then they modify it and there’s a lawyer on the other side and, you know, it’s just like, “Well, no, it’s fine. It’s fine.”

RZ Yeah.

PF And you’re sitting there and you’re like, “Lemme see that contract before we sign it.”

RZ Yeah. That’s true.

PF That’s really good. Like—counsel has seen all of the contracts that Postlight has signed.


RZ Yeah. I think the other thing and—that gave you some comfort here, as an attorney, even a non-practicing one, the last thing we give out is comfort.

PF Yeah.

RZ Ever. In fact our job is [Paul laughs] to give—to provide discomfort as much as [that’s right] possible, is that any sort of outreach from legal freaked you out.

PF Oh yeah!

RZ Like a letter like of any sort.

PF I don’t wanna open it. If I get the email and it’s the other—the contract on the other side makes me nervous.

RZ You really and—and I think you’ve seen me open letters and then throw them in the garbage immediately [laughs].

PF Yeah I think—you turned to me and, you know, knock on wood [knocks], we haven’t been sued and I don’t think we will—I mean we keep—

RZ We’re good people.

PF We keep everything buttoned up; we deliver what we say; and if there’s disagreements, we sit down and [yeah] we do a good faith effort to figure everything out. So, we’re pretty good but you just turned to me at one point and you’re like, “Don’t worry. We could get sued. It would be ok.”

RZ Yeah.

PF Like, “No, it’s just—no, it’s not gonna kill you.” [Rich laughs] “If Postlight gets sued, we get sued, and I’m like—what you don’t understand if you’re not an attorney, I think you—you forget but like you’re under constant litigation risk; the news is about everyone getting sued; and then you’re like—and you read stuff like the Theranos story, which literally they just threatened everyone with everything. And they have the most high-powered lawyer in America—one of them, David Boies—

RZ Mm hmm. He was the Bush/Gore voting attorney.

PF Yeah, that’s right, and so what are you gonna do if that comes for you? [Laughs]

RZ Yeah, yeah, yeah, you’re just gonna bow down.


PF Like I don’t have any tools or understanding and I was—before we started Postlight, I think I lived in a lot more fear [yeah]. And also you’re kinda—you don’t have a lot of money to get a lawyer to look everything over and on and on.

RZ There were examples in that book of other lawyers, when they found it was Boies, saying, “Just sign it.”

PF “Just, yeah, just let it go. Let it go.”

RZ “This is too much, just don’t do it. Don’t do it. Don’t go there.” Meanwhile these are lawyers who could’ve made money and charged [no] fees.

PF It’s not worth it. It’s not worth it.

RZ I think there two lessons that I took away [ok] from the book. One was—and this is, I think, someone—anyone that has a business or is thinking of starting a business, around how you treat people.

PF Mm hmm.

RZ There’s two ways to get people to stay with your organization: fear or really a sense of commitment and loyalty to the place, where if someone leaves, you end up—if you’re doing it right, if someone leaves, you pause and you reflect on yourself.

PF Right.

RZ Right? And wonder what happened? What can we do? We ask ourselves that all the time.

PF We do that. We do pretty serious post-mortems when people are headed out the door.

RZ Exactly.

PF It’s less if somebody leaves Postlight for a startup and they have a certain ambition that’s—that’s easier. We haven’t [yes]—I don’t think we’ve—we tend never to lose people to other agencies. That would make me really . . . pause.

RZ Yes. And that kind of fear is healthy. The kind where it’s like, “If they leave, they will ruin me,” and they are instantly the enemy—

PF Yeah.


RZ You’ve got a whole other ap—approach that frankly goes back in the org. It just becomes sort of you can’t leave the cult kind of a thing.

PF I think that’s—that’s right. It’s this sick system, you can’t escape it. If you leave, you will have forsaken your entire future and let everybody down.

RZ Exactly.

PF Now, that person clearly was really gifted at building that kind of environment.

RZ I think there was—I think if they woulda just calmed down and let the smart people in the room do their thing, and not over-promise, I think they could’ve probably found some—

PF This was the hard part. The problem it was like a one—

RZ Product! This is about product. Product is hard.

PF [Crosstalks] It was a one point five billion dollar business. That’s the problem.

RZ Exactly.

PF They had a one point five billion dollar like blood testing like situation and they needed a 20, 30 billion dollar blood testing situation to keep up.

RZ Exactly, exactly.

PF And they got themselves into a pickle. There was clearly the talent and the drive to get something real into the world.

RZ Yes. Yes. And they just kept going bigger and bigger—

PF [Sighs] That’s the problem.

RZ They just lost track.

PF I have a lot of empathy. Every time you build something, you think to yourself, “Well this is gonna change the world.”

RZ Product is humbling, man.


PF Once it’s actually—yeah, once it gets into the world [yeah] [chuckling] and you’re like, “No, I’m actually—I’m dog shit.” [Rich laughs] Is usually how that goes. But yeah, ok. Well, that’s real. That’s real. It could’ve been an—an incredible success.

RZ It coulda been a—a like, “Hey, you know what? They cut the time in half on getting your blood result.”

PF [Sighs] There’s nothing wrong with—

RZ Or something. It’s ok! It’s ok.

PF—an incredible success.

RZ It’s ok.

PF But it doesn’t [music fades in] make for the—it doesn’t get you on the cover of like Ink Magazine.

RZ Yeah [music plays alone for five seconds].

PF Rich, we should just interrupt [music fades out] the show for a minute to let people know about Postlight.

RZ Postlight actually loves actual problems, Paul!

PF That’s true. Big companies kinda know us and they say, “We have this thing that’s going on and we’ve got about 18 months and let’s get it done!” And it’ll be like . . . [sighs heavily].

RZ You could feel the steam from the pressure [yeah, it’s [chuckles]] to solve the [laughing] problem.

PF A lot of people come in and just blink at us for awhile.

RZ Yeah. I’ve—I’ve had clients and some of the bigger ones say . . . instead of, “Rich, if we pull this off, I’m gonna big a start,” I’ll often get, “Rich, if we don’t pull this off, I’m done.” [Laughs]

PF Oh yeah. At Postlight, we’ll take—we’ll sit down with you and make it so that you’re not the risk anymore and we’ll get that—

RZ We’ll take it on!

PF We’ll get that—we’ll take the risk away from you and we will get you your software.


RZ It’s a great team of designers, engineers, product leaders, and strategists that will help you solve some of your nastiest and biggest technology problems.

PF You know what sales is like at Postlight?

RZ Right here! You’re listening to it, baby!

PF You send an email to and it comes to me and Rich.

RZ And you get to be on a podcast without headphones.

PF [Laughs] That’s right.

RZ [Laughing, music fades in] It’s just us!

PF Alright, so everybody: [music plays alone for five seconds]. I’ll tell you what I took off for this [music fades out].

RZ Go.

PF Ok. It’s very easy if you are a smart, talented person who has succeeded . . . to believe that you have perfect knowledge about things that you know not a damn thing about [yeah] and the number of people hovering around this complete disaster, who were convinced that they had found the source of genius, and the future of everything, and were completely wrong. A hundred percent.

RZ Geniuses! Brilliant people!

PF Brilliant, brilliant people.

RZ Yes.

PF And not just the old dottering Republican establishment like Henry Kissinger but like the Obama administration was connected to this thing [yeah] cuz everybody likes to get in on a good story.

RZ Well the herd was just a collection of like Nobel laureates. I mean [Paul chuckles] it was just—


PF This was so good.

RZ It was so bizarre. Right? I mean, shit, Kissinger’s here. I mean Kissinger’s here for Christ’s sake.

PF Don’t forget that like—but also like the Stanford chemistry professor, whatever, like everyone—

RZ Everybody’s there! And, you know, the risk around that just goes down and down, like further and further down and like, uh! Somebody did the homework. [Yeah] Somebody checked this out. I mean, look at—look at—look at this list of people and it just snowballs [yeah] and next thing you know, Rupert Murdoch is signing a thing and he doesn’t know what—there are just like crayon pictures.

PF No, somebody was like, “Rupert, this is amazing.”

RZ “I spoke to George Shultz!”

PF Yeah this is—this is exactly what you wanna be in on. And so I think it’s a very—it’s a very easy lesson to takeaway like, ah! They’re all idiots, anyway! They’re not. These are really smart, capable people who got a lot done in their lives.

RZ Yeah.

PF And then they really thought they had something. One of the things that I like to do when I’m confused about something is walk the whole stack . . . is what I call it. Like, go—ok, what is this? What is—ok, what’s under that? What’s under that? Until, literally, with—especially with software, you get down to the CPU.

RZ Yeah.

PF Like you should be able to draw a line from this thing that somebody promised you and tells you is gonna happen all the way down to the crappy microprocessor in their fun.

RZ Yeah.

PF And if you can’t—you know, if you can’t close up those gaps, sometimes that’s your knowledge, but sometimes people are just selling you bill of goods.

RZ Yup.


PF You know, they’re gonna change human reality in some way or people are gonna do it this instead of that way. Well, wait a minute.

RZ Well, I mean if I’m the founder, right? And I’m believing and then all of a sudden I look at my board and it’s essentially the—the like Reagan administration [Paul laughs], right? And I—I think—I think that what I’ve projected comes back at me and, I mean, obviously! There they are!

PF See, I think that’s real. I think that—

RZ And it’s just that’s a very fascinating sociological slash psychological story there. It’s like, “I’m surrounded by the geniuses and, therefore, we must be ok.”

PF Let me tell you something: I think that money makes it really easier to believe things.

RZ And I think it’s money and they were throwing big parties and—and Silicon Valley, there’s something just so greasy if you lift up the rug.

PF [Crosstalks] Yeah, oh there’s a lot bugs running around.

RZ It’s just—it’s just that’s it.

PF Not like here in New York City, right?

RZ [Crosstalks] Oh, no, here I mean it’s just pure—just go—

PF Where everybody’s above board.

RZ—to the garment district, man. Everybody’s just treating each other right.

PF Just the way that the real estate industry works here and people are just respectful and help each other [Rich laughs] um I mean that’s—I guess that—but that’s—you know [oh my God], the funny thing there, actually, it’s a good point. Everybody knows it’s corrupt in New York City.

RZ It’s under—you just gotta play the game and—

PF And nobody pretends that real estate in New York City is a utopian, life changing industry that’s gonna make the world better.


RZ No! Look—

PF It’s just savage vampires sucking blood from each other.

RZ I think corrupt is too much. I actually think—I think it’s brutally competitive and I think you have to know how to play. Corrupt is—

PF Yeah, until you go—eh, until you go for a closing and they’re like, “You just gotta give this guy 300 dollars.” “What’s his name?” “Doesn’t matter to you.”

RZ Well there’s that.

PF Yeah. No, no, it’s actually—there’s—

RZ I mean if—the little nibbling corrupt, fine.

PF No, no, this is an incredibly corrupt state!

RZ Albany—New York City has nothing to do with Albany.

PF [Laughs boisterously] No, it’s great. No, you’re right. No, corruption here. New York City. Not a problem.

RZ This was about Silicon Valley. Why you gotta shit on the home terf, man? [Paul laughs] We’re Postlight at 101 5th Avenue! [Chuckles]

PF All I’m saying is that New York City has—it’s kinda known what the rules are once you’re here for awhile. And they suck sometimes [yes]. It is not conducive to success. However, Silicon Valley tends to kind of—it’s got the same kind of corruption and hustle but it tends to dress it up in world-changing utopian dreamscapes. And they’re like, “Look,” they just lead literally unicorns.

RZ “The future is here. The future is now.”

PF Hmm. Here we go.

RZ Yeah.

PF Just, “Blockchain!”

RZ Literally unicorns, just—

PF Literally unicorns.

RZ A herd of unicorns down Sandhill Road.

PF [Music fades in] Exactly, exactly, and so you’re—and so that—I do like that about this city. It’s not a monoculture. And the worms and the insects are running down the street. You don’t have to lift up a rock to see them.

RZ Yeah. Yeah.

PF Anyway, people should read Bad Blood. It is a very straightforward narrative about what can go wrong when you believe stuff.

RZ Yeah.

PF I mean it is so easy to go in one direction—

RZ Yup.

PF—and then keep going.

RZ Yes.

PF Alright, let’s get outta here.

RZ Alright, bye everyone [music ramps up, plays alone for five seconds, fades out to end].