You told me things were very frothy a lots happened since then. The wework had just come out. We know what happened with the wework blowup theres been this sense that you saw with the wag news. Theres been these companies have raised an extraordinary amount of money and pitching themselves as Tech Companies that really went Tech Companies. Wework was not a Technology Company. Swag not really a Technology Company, and the combination of trying to get the technology valuations on companies that shouldnt be trading that way and companies that are just raising too much money and have no financial discipline. Hopefully some of that is coming to an end but i still think valuations are going to be crazy for a while. I think, if anything, this signals the beginning of the end of these shoot the moon sort of Business Plans what i mean by that is we just they dont work for two reasons. One, companies are raising a tremendous amount of money and they do that primarily to try and have some sort of competitive advantage versus their competitor but all that does is actually just drives more money, more funding to the competitors it makes it easier for the number two to raise money, not harder and i think on the second issue, really, is that once you are running one of these companies, you realize that running a company is all about managing habits if you have a habit of managing a company at a really high burn rate, its very hard to then make a righthand turn into fiscal responsibility. And so if you have raised the money, the capital is sitting in the bank, youll end up spending it and thats part of the problem. You heighten the risk that you are not going to make the metrics for the next round the Public Markets are beginning to, obviously, figure this out you can look back at this year, go look at zoom as a great example of a company that went public, had great metrics, growing over 100 year on year, great net dollar retention but also Free Cash Flow positive and from a performance standpoint, that stock today trades at 40 times sales and 400 times forward earnings and the reason why investors give it that leverage or that latitude is primarily because its working on the economics just to jump on that, i think the retail investor, Public Market investors have gotten more savvy about the difference between growth with great Unit Economics. So amazon, hey, if amazon is not profitable for a couple of quarters we know and weve learned the lesson amazon knows the day it wants to be profitable it can cut back on r d and drive tremendous profits. Growth with great Unit Economics like an amazon or zoom will pay for that growth at all costs with poor Unit Economics while youre seeing a bunch of these Companies Trading below their listing price. Thats over now, though, right . Growth at any price . Can we say thats done Growth WithoutUnit Economics that work, people are are on to that. And i think thats going to be over at least for a while its no wonder you guys talk about zoom if you look at the best performing ipos of the year, zooms right at their second best the stock is up 81 . If i had told you at the beginning of the year that uber and lyft were going to do so poorly and that beyond meat was going to be up 200 or thereabouts and zoom and crowdstrike would do so well, you would have told me what at that time . Zoom and data dog have two unique specific attributes about the companies. And they are companies with great recurring revenue streams. Have high net dollar retention which means if the business stopped today, it would keep growing from a revenue perspective just from its Current Customer base. And they both were Free Cash Flow positive. So both of those things show that those are, you know, a good place. I think the issue with uber and lyft ultimately is a bit of this you are trading on someone elses capital for a bit. Uber and lyft essentially have massive stipends and bonuses that they pay drivers and drive the incentive wheel in that way. If they take that away, ultimately both of those companies will be highly profitable its just a question now of, who moves first . You think there are a lot of pretenders out here . Generally speaking, yes jon fortt just asked the mongo ceo, and we had this conversation yesterday with fra frank of snowflake everybody is a Software Company when in reality thats not actually the case. People are pretending to be something they arent as you alluded to with everybody calling themselves a Technology Company whether they are or not. The multiples on the Software Companies and the multiples on these profitable sas companies are so tremendous Everyone Wants to paint themselves that way the reality is exactly as you mentioned. A lot of them are. Wag, in hindsight, these things seem sort of obvious wag should have never raised 300 million it was a Good Business, a decent business could have been a nice profitablebusiness of a certai size poured too much money into these companies and it ruins them. Its a softbank effect as we talked about before. And thats sort of where and why we are where we are in some respects is that true well, look. I think one of the things thats now driving it is the employees are recognizing whats actually happening. And when these Companies Raise a tremendous amount of money at a very high valuation, it used to be the case that that was celebrated i think employees now realize that that comes with risk. And its the employees that ultimately are left holding the bag. Heres what i mean by that when investors go pour a bunch of capital into a business, they ultimately have preferred shares and liquidation preferences. The employees are sitting on the bottom of the stack. And so i think people are now starting to realize that more capital, especially raising more capital to do uneconomic things to drive market share just dont work you guys have a new fund. Are you being more selective in the companies you look at and the amounts of money youre willing to throw around . I think from the beginning, we were. We had a perspective that Unit Economics and existing Product Market fit were going to be important to us. We tried to avoid we try to avoid companies that are, hey, growth looks great now and then this miracle is going to happen when we do this thing that we arent really sure about yet and that will cause the Unit Economics to fall into play and then well be profitable we stay away from those things you see these in some of the companies where the Unit Economics dont work now that are public the pitch is, well, this and this and this are going to happen and the Unit Economics will be great. We tend to stay away from those things weve done a bunch of Enterprise Software so far this year just havent seen anything we like massively well in consumer. Usually from a trend perspective, that means things are greater. These things tend to go in cycles its been a dry spell in consumer for a little while on the private side that will change we touched on the softbank issues and you mentioned wag diedre bosa has been tracking down these stories in her reporting. As if the drop in uber and wework wasnt enough, more for softbank today wag just the latest we were talking about this just before we came on tv, but its the perfect example of vcs pointing to softbank and saying, what are they doing . This is evidence they dont know what theyre doing and its a good example of taking perhaps more money than you need wag initially was looking for 75 million. Softbank offered 300 million. They didnt do what they are supposed to with that money or couldnt get those Unit Economics to work. So theyve laid off im told 80 of their workforce from the beginning of the year. Softbank is selling its stake back to the company. Of course, its not the only one, right theres worries bubbling about some other vision Fund Portfolios you see you are talking about looking for more Profitable Companies or with paths to profitability. You see losses accelerating. The chinese startup that has money from softbank, the korean ecommerce site. Theres going to be another softbank ipo this week at a much lower evaluation than softbank invested when you hear vision fund 2 is full steam ahead, does that make you worry do you roll your eyes and say, do we need another vision fund it does make me worry and roll my eyes those are two Different Things i think vision fund 2 if you are an investor, a good question you should be asking is why. Just i dont see it you dont see the need for were seeing whats happening. You get you generate you bring in 100 billion. You have to put the money to work because youre drawing fees your lps want you to put the money to work. So you end up trying to find places to put an extraordinary amount of money to work and those companies are taking too much money and collapse under their own under the weight of that cash. As adam mentioned earlier, it creates all sorts of bad habits when you have too much money and those habits are hard to change. Do you share dicks view on that totally mine is even now, after going through the process of raising our own fund, i look at 100 billion and the things that you can do with 100 billion you can literally change the face of technology and humanity with 100 billion. Yet you chose to invest in a dogwalking service. I love dogs. We all love our dogs ill show you a picture of my dog at the end of this making sure he doesnt get yelled at on twitter at the end of this. With that kind of firepower, i question why youd go invest in things that wouldnt further humanity than just further your dogs ill play devils advocate. I know especially being here in the valley, a lot of vcs its easy to rag on assad especially now, kick him when hes down. But this is the guy who made a bet on alibaba thats made him one of therichest men in the world. If you look at the returns from the vision fund he says we dont get a full view into it but theyre double the average vc returns. And you also take a look at where they are winning and losing transportation, real estate. Theyre losing big there but theyre actually doing well on consumer which makes up 20 of the vision fund. Health tech enterprise as well so its not all its not so black and white. Its not actually on the vision fund though i think they werent being smart around allocation of that capital my fault, if you ask who is to blame its the ceos who took the money. They decide to ultimately take the money. They take the capital and they take it at a very high valuation. It ultimately then has a high risk reward game theyre playing. And oftentimes what were seeing its just not working out. Isnt this what this is all about here, though you are trying to grow your business the point adam makes, you see ceos, firsttime ceos optimize for valuation over everythin else repeatedly, and its like this classic mistake of, well, the way everything is measured out here is by valuation if i raise this much as valuation, then im better at this other thing you create all sorts of you are out way over your skis that causes all these Unit Economics problems or spending habits that are hard to correct later. I think adam is 100 right and not taking anything away, yahoo japan and going back to that and before, the guys made bold and courageous decision after bold and courageous decision vision fund 2, were seeing some of tresults of vision fund 1 and id question whether thats a good place to put so much money. If you see all thats happened, there was a needed reset out here and if its in the process of happening in some respects, vision 2, delays the process of a reset. It just means that free and excess capital is readily available that will need to find a home and will find a home. The party is about to end lets come in with trucks of champagne. Here we go again part of the issue, too, is its not just coming at the very end of companies financing history which is where the vision fund traditionally played but also out here, tremendous amount of capital at the early stages so it really looks more like a bar d barbell. So it really means this middle part of the companys history, i think, is where the company will win or lose. And so that management part in the middle is really the key again, to jump on something adam just said, we see because these companies tend to be close to public or just newly public, the results of the vision fund investments, theres a lot of, you know, excess investment and valuation in the early stages. A Company Raises a seed round and then raises an a and go and raise a b, the series b are happening now at hundreds of millions of dollars in valuation before the first customer is live thats just as crazy theres a recent series a for 200 million but they say, better path to profitability but i have a question for you guys would you be comfortable taking the other end of the softbank bet. Investing in a company where you know its competitor is going to get 100 million, 200 million from softbank. If the Unit Economics i dont think that the short answer is, yes, because theres capital available to Management Teams that execute well. And you dont have to worry about thats the only vision fund is the only place you can go raise money so if you are competing against them, youre out of luck thats simply not the case if you are a Great Management Team and disciplined Management Team and growing ebitda and growth with great Unit Economics and a path to profitability, youll not have any problem raising money. I want to pivot and thank you for joining us again lets talk about twitter if we could. The latest news is jack dorsey says hes moving to africa he is still running square and twitter. You were c. O. O. There. Yeah, you answer this question well get to you in a second. Would you havelet that fly . If you want me to try and defend it, heres what i would say. 75 of twitters audience is outside the u. S. About half of its revenue is outside the u. S. Most of the user growth, their Revenue Growth has been coming outside of the u. S like it or not, while this is a u. S. Hqd company, most of the action for this company, i think, is happening outside the u. S. Tough for us sitting here or tough for some of us sitting here in San Francisco to think that its not the center of the universe but the fact is its not. Couple that with the fact that jack, i think, is looking at africa as a huge growth factor for the company, both ultimately in or square i think if you ask him, his perspective will ultmaltly be around users and revenue and then lastly, i think hes got a view that he has to figure out some way to decrease the hiring pressure here in San Francisco and so by creating a more Remote Workforce and he may lead by example. Ultimately the question may be for some investors, not that hes deciding to go live overseas, and study culture there, but actually the market that he picked and it may be the case that some investors in twitter may ask that he spend another three months over in japan why japan . Twitter is bigger than facebook in japan or any other market or any other competitor globally. If you can figure out or in japan. If you can figure out whats happening right in japan and export it across the rest of the world, that would be time well spent. I didnt want you to defend it or in fact, that was the genesis of the 280 characters expansion. Understanding the way it was being used in japan and the character set in japan, how tweets were being engaged with and the tweets at a larger character set were being driving higher engagement. End upped being the driver of the 280 being rolled out to the rest of the world. They call the decision, quote, reckless, says its irresponsible and negligent of the board to allow it. I think the board im sure the board and jack will have a conversation about that tweet. You know, i think that ill say this i mean that seriously. Im sure the board and jack will have a conversation about that i havent read you the galloway stuff im sure i can guess what that says. Ill say ill take a little bit of a different angle to what adam said just to try to be dramatic jack likes to test out ideas publicly if you remember, he wrote a blog post or maybe sarah friar published it when she left square the ceo of square left to become ceo of next door here are the things that jack said to sarah upon leaving one thing jack said was you have to be willing to fail in public. And jack likes jack will try out ideas and things hes thinking to himself publicly, you know, first before discussing them privately with other people and thats just who he is. Was this a jump the gun decision heres what professor Scott Galloway tweeted he wrote an oped as well. Jack dorsey is a parttime ceo 80 of his wealth comes from his afternoon job sknair its difficult to ask people to work evenings and weekends when the ceo works mornings and then moves to another continent jack must be replaced. As i said, im sure jack and the executive team and the board are going to have a conversation about where the appropriate place to live is and how long you should spend there do you think he should go or not . Im not going to i think jack has done a terrific job with the team and the company. The team there loves him the people who work there, you know, you can see it on twitter. They all appreciate w