DreamWorks & the Science of Storytelling | Jeffrey Katzenberg & ChenLi Wang, WndrCo

[00:00] I went and tried to buy the company from Steve Jobs for $50 million. He wouldn't sell it. There's $700 billion of capital investment being made in 24 months. I mean, it's an unimaginable number. Do you think the bubble's going to burst in 2026? I think there'll be a reckoning. How many unicorns have you invested into, and can you name all of them? I've lost count. My movies are only as good as their villains. [00:30] Farquaad, Tai Lung. Like, I can go on. Is that bad storytelling or good storytelling? It's good storytelling to bad outcome. [00:41] It's evil storytelling, if anybody knows of. [00:44] Barry Diller, he is a restful, tough, grinding, hard, demanding person to work for. And for me, it was exhilarating. By the time I was 30 years old, he had made me head of a movie studio. Think about it in the context of today is just mind blowing. So this is the hot question. What happened in 2025? [01:03] MUSIC [01:09] *music* [01:21] Chen Li and Jeffrey, welcome to Sorcery. Well, happy to be here. [01:26] Pump to beer. [01:27] Thanks for having me at your gorgeous office. Good, good, well.

[01:32] Our home's your home today, Molly. So let's do it. Well, we certainly made it that way walking around. So I appreciate that. Well, I want to talk about so many things today. Definitely we need to go into the origin story of WonderCo, the state of the VC world. We're coming off of a really hot year of 2025 and going into 2026. And we'll also get some of your predictions and more on the fun strategy. [01:57] So, [01:59] This is the hot question. [02:02] What happened in 2025? [02:06] All right. So, [02:10] I think... [02:11] One thing we observed is new technology just takes time. [02:14] to get molded and shaped into products and into experiences that actually make an impact in people's lives. [02:21] I think this is really the year where we saw some really cool [02:25] oh yeah, this is different. We can definitely, AI is going to transform how we do X and Y. And it's not just people playing around with like, hey, look how this is like a show your friend over their shoulders type of moment. But really, [02:37] this is a new way of doing business. [02:39] It's still going to take a decade, I think, from here. [02:42] to fully... [02:44] iron out all the kinks of how [02:47] companies work, how people [02:49] Collaborate. [02:50] Bye. [02:51] Yeah, this is... [02:52] It's almost a relief that given all the excitement and hype that this is going to be a [02:59] a wave that we can build around for [03:01] A decade to come.

[03:02] I mean, I subscribed to others that... [03:05] Also subscribe to this view that even if you just froze, [03:09] model development. [03:11] at this moment in time. [03:13] I. [03:14] there's still so much more. [03:16] that we need to figure out and do and productize to actually make delightful products and experiences for consumers, for businesses. [03:23] that, [03:24] we're excited about where the research and everything is going, but [03:27] Even if that froze, there was so much to do. That's what's exciting. [03:33] Yeah, I mean, I think that's it. I think we saw... [03:36] you know, [03:37] What were... [03:39] The big dreams and promises become tactical. [03:43] And the... [03:45] tactical revelations had [03:48] um [03:49] both good and bad in it, in that there is real value creation [03:56] real productivity. [03:58] And then, [03:59] You know, I think the other side of it is, is that it got overheated. [04:04] You know, I think that the... [04:07] enthusiasm and optimism [04:09] got ahead of itself. [04:11] And I think when we look into... [04:15] you know, some of the challenges going forward, the amount of capital, [04:20] allocated for the hyperscalers in this and, um, [04:26] you know, what they have to achieve in these next two to three years. [04:30] It's a, it's a high bar, you know, there's $700 billion.

[04:35] of capital investment being made in 24 months. [04:39] I mean, it's a... a... [04:41] unimaginable. [04:43] Number. [04:44] On the other side of that is it needs to produce a result. [04:47] it needs an ROI to it and, and a, you know, [04:51] And I think that's still... [04:54] I think that's what 2026 and 2027 are going to be revealing. [05:00] In the meantime, there's lots of great stuff to be done. [05:03] Do you think the bubble's going to burst in 2026? [05:07] I don't know whether it's a... [05:08] I think rather than [05:10] look at it from the sort of extreme notion of what that means for a bubble to burst. I think there'll be a reckoning here in which. [05:19] those that actually are producing real [05:22] uh, [05:24] results and and are being deployed in really effective and efficient [05:29] ways that you can actually see an outcome. [05:32] quickly and it's real. [05:35] um [05:36] I think some of the bigger aspirations are... [05:38] you know, knock onto [05:41] They're not all going to win. I mean, I think that that's the thing that, [05:45] You know, this is not going to be, it's not going to be a, uh, zero sum game, a one, you know, winner take all in it. [05:53] But I also think at the same time, [05:55] Not everybody is going to win at this. [05:59] So I want to talk about some of the breakthroughs and some of the leading companies that you have been fortunate to invest into. So Chenly, how many unicorns have you invested into and can you name all of them?

[06:14] I've lost count. I think that the special stories are the companies that [06:20] we... [06:21] Got to know the founders. [06:23] early. [06:24] built a relationship, [06:26] had that shared [06:28] You could see the vision. You could also sort of say, yeah, a lot of things need to go right. And there's a little bit of a murky mind maze to go through. [06:35] And, [06:36] And then there's setbacks and there's challenges along the way. [06:40] And then when they finally do... [06:42] breakthrough that's when they get all the celebrations but we're like remember those tough dark moments um that you know we were texting late at night about it's like now you'll you'll get through this like that's actually what's more rewarding for for me [06:54] is... [06:55] Because that... [06:57] You know, you can only control the... [06:59] the inputs in the grid. [07:01] And we all recognize how much macro and luck and just circumstance is. [07:06] factor into what ultimately happens. [07:09] and [07:11] Yeah, that's... [07:12] That's what I think about day to day. [07:14] are there any companies that you're particularly excited about i know you guys have backed bridge harvey [07:20] handful of others. [07:22] So we've been fortunate working with some great founders in the Curzor and the Bridge, Harvey's. And those are just great examples of [07:31] who would have thought multiplying matrices of numbers and predicting the next token would be [07:38] can unlock [07:40] If you zigzag across two years, things that are transforming how doctors do their work every day, how lawyers do their work, how lawyers and their clients do their work.

[07:50] I love going to startups offices and getting the vibe and culture of the place. And one of the things I do is just kind of look around and see how many screens have that right tab. And it's like, wow, cruises everywhere. So... [08:03] Yeah, it's like in a year. You know, if I just did like a walk around in an office in 12 months, [08:10] It... [08:11] It just went from zero to 100. [08:13] practically. And that [08:16] that's what makes this place special. And this is not just startups here. I can go to startups all around the world, in New York, in London, in Stockholm. And yeah, that right tab is right there. [08:29] And then, by the way, you've seen the other thing is in the upper right bar on Macs, you can see what are the icons. I used to work at Dropbox, so I'm still like hunting for, thank God you still have Dropbox. But we're fortunate to be investors in 1Password, and that's more or less become ubiquitous. [08:46] We became investors in Granola, and that's effectively become ubiquitous in startups. And so between the right pane and the top bar, we invest in the future of work and you're seeing the future of work on people's screens. That's pretty exciting. [09:01] Pretty exciting. Yeah. Before we go too far, because I know I'm already jumping the gun, but let's talk about the origin story of WonderCo. You guys have such a special firm, and it's something that I love. I mean, I'm from L.A., and so I met Anthony a couple years ago at this point, and the convergence of creativity and storytelling and venture was just amazing.

[09:22] so natural to me. And I thought it was like an incredible superpower and also entirely motivating and like an ambitious strategy. So can you walk me through the origin story and how you got together this team? [09:34] In spring of 2026, it'd be 10 years ago that I sold DreamWorks. [09:41] And, um, [09:43] Thank you. [09:43] you know, I'll [09:45] I think it's safe to assume your audience probably knows more about my past than they need to. But there's one little piece of it that I think informs how we... [09:55] uh, sort of got to where we did on, on, on putting WonderCo together, which is, [10:01] sort of a recurring theme. [10:03] through every chapter of my media and entertainment, [10:06] career was the use of technology [10:11] as, uh, for storytelling as a competitive advantage. [10:15] every [10:17] a couple of years, there would be these new, amazing new innovations. [10:23] coming out of Silicon Valley. [10:25] And I kept coming up here to... [10:29] find the latest and greatest and to then import it back into Hollywood. Steven Spielberg made Jaws. It's a great documentary 50 years ago. [10:40] He built a shark, a plastic shark and dragged it behind a motorboat. [10:45] And then, you know, [10:47] a number of years later made Jurassic Park, [10:50] which was really the first... [10:52] live action movie in which there were these digital creations that were

[10:56] you know mind-blowing to say the least and certainly [11:00] a major evolutionary step in storytelling. [11:04] So, and, you know, I, I, you know, I think 1989, 1990, I saw a little short film called Pixar, from Pixar called Luxor. [11:15] The lamp. [11:17] And, uh, [11:18] I was just so mesmerized and blown away by it. I actually first tried to hire John Lasseter to come back to Disney. He had been there before I was there, had left. [11:28] He wouldn't. [11:30] uh, calm. He didn't want to leave. Then I went and tried to buy the company from Steve jobs for $50 million. [11:37] which is the... [11:38] point in time when he was struggling with Next and actually was [11:41] kind of financially stretched. [11:44] He wouldn't sell it. [11:45] And then made that three-picture deal that turned into Toy Story, which turned into... [11:50] you know, one of the most transformative moments [11:53] in Hollywood, in storytelling, once again, powered by tech. [11:59] Um, [12:00] 3D. [12:01] Revolution came along as we're about to see Mr. Cameron's latest and greatest. I just, I can't wait to get to a theater to see it. [12:09] Um, because he's always raising the bar, uh, super high anyway. [12:14] So I've always been really enamored, fascinated. [12:19] gravitated up here. Um, uh, the, [12:23] First Shrek movie was actually made here in Redwood Shores with a studio with 800 employees.

[12:30] Um, and, um, [12:32] uh, [12:33] I actually got some exposure to some of the early venture capitalists and I, I [12:39] was always, um, [12:41] uh, [12:42] attracted to and fascinated by the fact that I felt like, [12:47] there was a sort of common, uh, [12:50] uh, a goal that, that I, you know, I'm a truffle hunter. [12:55] They are truffle hunters. [12:57] And many of the signals that you look for in great founders are the same signals I looked for in great storytellers. [13:05] And, um, so when I sold, uh, DreamWorks, I, I wanted... [13:10] to have a new career. I, I literally wanted a third act. [13:14] and to start over. And [13:17] You know, there are... [13:19] There are many things that are attributes, and I have some that are liabilities, and the attribute column is... [13:27] I know what I know and I actually know what I don't know. [13:31] And so that sent me on the pursuit and hunt to find great partners. [13:37] Partnership to me is honestly, I look at it foundationally as maybe the single most important thing I've had in every chapter of my career. And I continue to believe that. [13:47] back today, um, [13:50] Barry Diller, Michael Eisner, David Geffen, Stephen Spiller. These were my, my, my mentors and, and, uh, [13:57] you know, and partners over the years.

[14:00] And so I set out to find the equivalent for this next chapter or next act of my [14:07] uh life and i found that in sujai and shen lee and anthony and [14:13] Jeff Nykin and our most recent one, Justin. [14:15] Wexler, [14:17] We just have a phenomenal partnership. And what's amazing about it is, is that we're all actually quite unique from one another. [14:24] Um, I don't know, I can't do, I so rely on Shen Li. [14:30] uh you know on the technical side of it and then [14:33] You know, he looks to me as the storyteller. [14:36] and this and you know anthony who you know and has met has just got this uh [14:42] incredible social, uh, uh, [14:46] meter and, and, and, and ability to just [14:50] see over horizons and around corners that [14:56] you know, is invaluable. And then, you know, our, our, our really sort of guiding light in all of this Sujay is just, [15:02] Really one of the most exceptional and talented [15:05] extraordinary people i've i've ever known and um so that is really sort of been the foundation of the partnership and [15:12] what's [15:14] Most exciting to me is that [15:16] 10 years later. [15:18] It's never, ever been stronger. It's like we have found... [15:23] you know, the, the, [15:25] the sort of core of what makes us special and unique and how we complement one another and work with one another.

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[17:01] O-U-R-C-E-R-Y. [17:03] So what was it like going through... [17:06] all those chapters, all those years evolving the [17:09] practice and the firm and strategy. [17:12] Yeah, what probably is less known is that WonderCo started as an investment holding company. [17:19] And when... [17:20] we got together in 2016. Sujay and I, after leaving Dropbox, we [17:27] read about John Malone, who comes from Jeffrey's World Cable Cowboy. We read about The Outsiders and some of the [17:35] over the last... [17:36] 50 to 100 years. [17:38] companies that have [17:40] been good stewards of capital and built great [17:44] generational businesses. [17:46] I, [17:47] And that informed a lot of [17:50] how we thought about [17:51] Starting something new in 2016, [17:54] Also, when we looked at our... [17:57] skill sets. We had just... [17:59] Jeffrey spent his entire career founding and building scaling companies. Su-jae and I, [18:04] joined Dropbox when it was about a 20-25% startup. When we left it was 2,000 plus people. [18:10] we had deep conviction that there was something to be done with [18:14] all the talented folks that we had hired and seen them grow and scale and that we could do it again. [18:22] in different contexts and different situations. That's led to us building companies in consumer security, in other areas that we can talk about. [18:31] And it was really that operating...

[18:34] operating building-centric mentality that was probably the guiding light to this day of how we operate. Now we have different strategies, different ways of how we work with [18:43] companies and founders. But so what evolved fairly quickly [18:47] Um... [18:48] in our lives, [18:50] Our strategy, which as Chen Lee said, we started as a holdco, but we started as a holdco. [18:56] um and we really wanted to do two things we we wanted to build companies things that we would start ourselves or we would buy something that had maybe gone sideways and we saw an opportunity around or [19:11] Literally just, you know... [19:12] looking at [19:14] you know, market mapping, [19:15] big ideas that could change the world. Like we always start from a place of, you know, as big as we can possibly imagine and dream, and then look for, is there a solution [19:27] uh to that problem and if there is great can we find a way in can we find someone to invest in and if not let's just start it ourselves and so [19:37] Uh, we've, we've started eight companies, um, uh, since 2018. [19:42] um [19:44] The holding company next year will probably be $400 million of free cash flow. [19:53] extremely profitable, [19:55] and [19:56] growing really, really nicely, which is... [19:59] kind of an amazing thing. Along the way, we started to see, as we were building,

[20:07] that there were [20:08] um [20:09] some great investment opportunities venture opportunities and so the very first one was one password [20:16] We actually looked at 1Password to make it a part of our cybersecurity, consumer cybersecurity portfolio. It was a great... [20:27] would have been an incredible bolt on. The problem was it was too far along and too big for us to do it. But what was clear is it was a terrific investment opportunity. And that really sort of was the catalyst for us to say, okay, um, [20:44] Let's [20:45] do this in a sort of [20:46] um [20:48] I pay an homage here to really three firms that I would say [20:56] are probably most analogous to what we're doing today and what we continue to aspire to. So founders fund. [21:06] You know, they built those companies. Peter Thiel and those guys, they started, you know, PayPal. They started Palantir. Like, they're builders. [21:14] They're also world-class investors. And they do both of those things. And there's actually great synergies that come from doing that. Next one that came along to do... [21:27] Their version of it. So each one is driven very much by the uniqueness of the people and the personalities. It was Andreessen Horowitz. [21:36] where mark and ben again phenomenal founders you know built incredible companies

[21:42] came together and sort of at the outset were doing [21:47] That same thing, but having that founder's mentality. And the guy who is then the next one up and is about four or five, six years, I guess, ahead of us right now is Josh Kushner today. He's just... [22:01] you know, crushing it. I mean, he's just really, you know, we, we look at that and just great admiration for, you know, what he has done and continues to do. And, you know, [22:12] you know, [22:13] Our ambition is we're at bat. We're the next ones up to bat to follow in that tradition. Now, we won't be the same as any of those three, but we're certainly, that's the kind of lane that we find ourselves in today. [22:28] When you think about building these companies, what's the process? Find a big idea. I mean, the latest one that we're doing, which is really sort of in its baby stage, is the whole thing around longevity. [22:42] You know, for as long as man has been around, [22:46] He's been in pursuit of, you know, the fountain of youth. [22:50] Everybody wants to... [22:53] Be healthier longer. [22:55] And so it's a perfect example where we looked at the... [23:00] the world and everything that is going on in that marketplace today. [23:06] and actually saw a pretty... [23:09] compelling gap. [23:12] Um, and, um,

[23:14] 95% of what's going on around it today is snake oil sales. [23:19] you know, driven by... [23:22] you know, people trying to sell supplements and, you know, [23:28] you know, new treatments and process that are really not driven by actual [23:34] Science? [23:35] And that was the light bulb for us. By the way, it's not to say that they're not, there are some great people that are doing, you know, admirable work in this area. So I don't want to paint the brush of just saying that, you know, I would just say by example, I think Peter Artia is, you know, [23:49] pretty unique and doing some great stuff. We invested in a company alongside him, more in the disease detection and prevention area, which is very, very different from longevity. [24:04] Um, and, um, [24:06] So having seen that, [24:08] we realized the opportunity was to actually build something that is foundational to it, is the leading research scientists around the world. [24:17] Can you bring them together under one umbrella? [24:20] gather, uh, uh, extraordinary amounts of data shared across, um, [24:26] these different verticals because longevity [24:30] There's many, many different, you know, there's mental acuity, there's bone density, there's skin, there's just metabolism. There's so many different expertise in that area. And so we started Wonder Health in New York and today have 70 of the leading organizations.

[24:48] scientists in the world. [24:51] who are affiliated with us, and we are in pursuit of things that... [24:55] will become... [24:57] We hope, we believe, we're fairly confident. Big consumer opportunities. [25:03] But I think at the outset, before we even started that, our typical process is, you know, we're [25:07] meet every Monday. We're on text 24-7. It's debating what are the big [25:12] opportunities and then from there [25:14] being [25:16] relentless that's there's one we described jeffrey relentless about meeting every interesting founder scientist [25:22] practitioner in this space. [25:25] Cold emails go a long way to... [25:29] um, [25:30] to just learn and soak it all in. And sometimes in the course of that, you'll meet [25:34] an exceptional founder who might already be on the journey and those turn into [25:38] investments for us. But sometimes we have a slightly unique view, or it's a market that, for whatever reason, because of capital, because of what's trending at the moment, doesn't get its fair [25:51] share a daylight and uh then that's when you have to develop the conviction to to lean in and roll up your sleeves and do it yourself and by the way convince other people storytelling uh to come along on the journey with you because of what you see as a as a potential opportunity [26:07] Yeah, when I was listening through all of that, I mean, I think health is a really interesting category in particular because to your point, it's full of snake oil salespeople. And I have to ask you this, as a world-renowned person,

[26:22] storyteller. [26:24] Do you view that kind of storytelling that goes so viral, that's so effective, very converting? Is that bad storytelling or good storytelling? [26:36] It's good storytelling to bad outcome. [26:42] It's evil storytelling. Listen, storytelling, which is the thing that, [26:48] I think I've appreciated and [26:51] understood and valued my experience, [26:55] you know, my whole career, which is storytelling is fundamental... [26:59] to every aspect of business. [27:01] It's not just, can you create a good story, i.e. a movie or a television show or, you know, uh, [27:09] you know, a [27:11] TikTok video or, you know, those... [27:13] Those are all great forms of storytelling. [27:17] But interestingly, the first thing, [27:20] For business, [27:22] I don't know of a business that has been or is or can be successful without storytelling. [27:30] It begins in the most basic way, which is, hey, I got an idea. [27:35] I need to go find really great people. In this case... [27:38] 70 of the leading research scientists in the world, [27:41] to come sign on board. We had to tell them a great story. I mean, these are people who've spent their lifetime dedicated in the labs, in research. Okay, well, why now and why us? Well, you gotta tell them a really good reason and you gotta do it in a really compelling way.

[27:58] And so, [27:59] You know, if you want investors, [28:02] to invest in your business, you actually need to be able to do a really good job of telling them a [28:07] good, compelling, [28:09] you know, thoughtful and appealing story if you want them to put their capital in with you. And then when you do have a product and you're ready to go talk to, whether it's B2B, to enterprise or SMB or to a consumer, [28:24] You gotta be able to tell them what you got and how it's gonna make their life more better, bigger, faster. [28:31] Something, right? So storytelling is... [28:35] It's just fundamental to everything that we do. And I feel like... [28:41] Our focus on that [28:43] with our founders in particular here in the venture world has become more and more appreciated. [28:50] and more and more valuable. And as the perfect example, which is, we talked about Harvey as one of the companies we're super excited about and incredibly impressed [29:01] with Winston, who's the founder of it. And literally in the very first meeting, when we talked with him, he said, "I need help with my storytelling." [29:09] Like I know my product crushes. [29:12] I I'm like, there's no ends ifs or buts about that. How do I get that out there into. [29:18] the world. And the same thing with Shiv, you know, at a bridge. [29:22] You know, and interestingly for him, it wasn't just...

[29:28] the enterprise that he needs to sell his product into it's then the doctors which is the demand side of it [29:33] he needed to do the same thing. And so those are just two very recent great examples where, [29:40] you know, I think the resource that WonderCo is able to bring to them [29:45] is unlike anything that they can [29:47] Fine, listen, we all look for the cheat code. What's the thing? What's the thing that we can do [29:54] Because our money, it's the same color as everybody else's. Our green is no different from anybody else's. It's not better. It's not worse. You know, it's capital. And so... [30:04] Sure, that's great. But if you want to win deals, if you want to be in deals, if you want to be with the best talent out there, [30:12] What else can you do for me? [30:14] And I think that's what we've tried to hone in on. And so, you know, when it comes to the product side, you know, Shen Li is literally in the all-star, all-star camp there in this. He's done it multiple times in it. He's held in the highest regard. And I watch with him with founders. [30:32] you know, who are looking for that product roadmap and they're looking for someone who just has knowledge, experience, you know, and outcome who can, you know, really get in there and, and, you know, [30:45] under the cover and really understand what's driving, what's the stickiness of it, what is the thing that is going to make it must have and must value to it. And there's just, you know, there are few people in the world like him. Some of you may not have heard this yet, but our sponsor Public just launched something called Generated Assets, and it brings AI into investing in a way I've honestly never seen before. Here's how it works. You type in an idea like AI-powered supply chain companies with positive free cash flow,

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[32:59] And, [33:00] When you get to that level of depth, I mean, I love it. I geek out on this day in and day out. That's just... [33:06] Um, [33:09] I don't know how you can not be genuine about that. It's so fascinating. I find this blows my mind here. Like the first thing that you... [33:17] should be doing. [33:19] is try the product. Yeah. Yeah. Like, and I cannot tell you how many times, how many, they don't actually like go try granola. [33:29] and just see how it's magical. [33:32] Right. And by the way, I can tell you when you've actually tried the product. Now, most of this goes over my head just to be really clear. And this, which is why Shen Li is essential in this in it. So, but granola, I got it in a scintilla of a second. You don't need to be a rocket scientist to understand. But granola is magical. [33:49] And you could see it just in the moment of it. It really is, there's something about it that is really, really interesting. [33:58] you know, special. And by the way, the most recent one that for me was this thing, Whisperflow. Yeah. [34:05] And how come it gets it right? Like in a way that I've never seen... [34:11] you know, voice to text. [34:13] Which is, I don't know about you, but everything I'm always doing, I've spent, there's no question, [34:19] 98% of the time I have to make corrections. [34:23] With that? [34:25] Rarely. It's extraordinary just the quality of that. And I'm

[34:31] So when those things come along, and... [34:33] Trust me, when they are sitting with us and we've actually... [34:37] use the product and they can, you know, and you talk about it that way. [34:42] Well, that alone gets them like, [34:44] that much more excited about wanting to [34:47] have you engage with them. [34:50] Maybe a little vignette. Years ago, I read [34:53] that Steve Jobs obsessed about the back of the circuit boards. [34:57] that went into the computers. You wanted them to look pretty, even though nobody really opens the computers to look at that. [35:02] And that was sort of his craft and dedication and almost the message he sent to the team. [35:07] And one of the first times I was using granola, some founder was listing through companies in the same competitive, you know, [35:14] domain that they were in. [35:15] And I was trying to keep a list of it. And some of the names were very esoteric. And then later I read the notes and they had been spelled correctly. And I was kind of like, how did you do that? You must have done, the product must have gone and done web searches to verify we were talking about this space. These were probably the other companies. This is the right way to spell those companies and polish up the notes to do that. [35:37] And that was one of those kind of edge case things that we used to obsess about at Dropbox. And there's just not very many companies that has the culture. [35:45] And, uh, [35:46] they craft an intuition to do that. [35:48] And so it is still actually still rare. So when I see that, I've got... [35:53] Wow, you're really obsessed. Whoever did this is really… [35:57] obsessed with that. And it's not that, is that feature going to unlock some viral, I don't know,

[36:04] But that's like the craft and dedication to it that... [36:09] I don't know. I just personally have a soft spot for founders who [36:13] Do that. [36:13] I'm so curious to hear your answer about this because I feel like we... [36:18] always hear about [36:21] new benchmarks having to do with revenue and different kinds of milestones and stuff like that. [36:28] And yes, there's benchmarks and evals for models. But I'm curious from your standpoint, like looking at the companies that you look at, what are the kinds of benchmarks that you now evaluate off of in this like AI era? Like what is the new standard to which like these apps, these platforms? [36:44] companies, infrastructure, cybersecurity, health companies that they like internally like [36:50] should be meeting. [36:52] So first is, I think, through the entire, our entire careers, pre-WonderCo and Jeffrey's entire career, we've been people people. I think... [37:00] the ingenuity and creativity of [37:03] people and how magical their spikes and how when you compliment [37:07] people and how what they can create together is [37:10] Is the secret sauce? [37:12] We've seen countless times, you know, Ali goes to Databricks, for example, how he's reinvented the company multiple times. [37:18] to have that [37:20] intuition about what they've built what the market needs where the world is going and building toward it none of that shows up [37:26] in a benchmark. [37:28] I... [37:29] The irony is many people now talk about [37:32] AI replacing humans.

[37:34] We have never assessed our best humans based on benchmarks. [37:39] I mean, how many years have parents complained about standardized testing? [37:43] or dumbing down their kids. And yet, I think we're going down the same route with the first... [37:48] the wave of benchmarks they do very well and other people said they do very well in benchmarks and they [37:54] fail in the real world. [37:56] Right? And I think, [37:57] it's time to stop thinking about. [37:59] the next generation of AI as just this very... [38:03] quantitative, uniform thing. It is about how do you actually [38:09] let them do the best that they can do with the right context, with the right workflow for your particular problem that you're solving for a particular user and customer. [38:17] And I don't think it's going to come. I don't think... [38:21] I don't know, is it 60, 70% of those use cases actually require frontier models? [38:26] I think you can, again, freeze the model. [38:29] And... [38:30] It's the ingenuity, the last mile that that's actually what's going to create a magical product. [38:35] One of our sponsors is Turing and they're an AI research accelerator. So they're helping support these models and get all the benchmarks and evals and all these kinds of things and get to super intelligence. And the CEO, Jonathan, I've talked to a couple of times. We had on the pod and [38:51] And his point, similar to this, is like the models are great. Like ChachiPT5 was amazing. Like we're starting to forget what magic feels like because it's normalized. And so what happens when like everything is automated? I don't know. What do you like? What do you think everything is going to feel like if...

[39:09] If like maybe in five years, I don't think it's going to happen in the next year, but like things actually start to pick up and like all of a sudden you get magical products, you get magical companies, you know, some of these processes a little bit more automated. They're understanding text scribing much, much faster and like. [39:27] those kinds of workflows get streamlined. [39:30] I think this is actually a famous Jeff Bezos quote about how consumers are never satisfied. [39:35] and the bar always gets raised. That's what probably will keep us in business for decades. And what personally motivates me is, yeah, we now take it for granted that they do all these things. But you're like, but you still don't do that correctly. And yeah, [39:49] I, [39:49] I don't know, there's probably a vein around [39:53] personalization, but not in the way that we currently think about personalization because there's still so much context that's scattered both in our individual lives and in the company's life across so many different sources. And there's a countervailing force, the bigger company you go to between role-based permissions and security and all those things that will just take [40:12] years unfortunately from having sold to those companies to to navigate before you actually unlock the context in an appropriate way to actually make uh these products just [40:23] Like, oh, you actually got how you read through, you know, how my company works for the last 10, 15 years. And this is what we should do going forward based on my culture or to sort of say, you know, [40:33] this is probably not good enough for what we should do in the future. So even though I have read all your contacts, this is how you should, this is my recommendation for how you might want to think about things differently. So I just think it's going to take a while.

[40:45] to unlock that, but that's the opportunity. [40:48] So you talked a little bit in the beginning about the overall structure of WonderCo. I'm curious if we could put some numbers behind that. So how much are you investing at the seed round, the growth and these build strategies? [41:00] So we have our core fund that will do both builds and invest in venture companies. [41:06] Builds will do about one a year. [41:09] And we'll put $50, $75 million in those builds. We take quite a bit of ownership in the early days because frankly, it's our sweat equity. It's what we roll up our sleeves. And we all pitch in. This is not sort of every partner does one. It's [41:22] That's why we sort of say we feel more like a company in a day-to-day of how we operate. [41:26] But it's fun. It's much more collegial. [41:29] On the venture side, we'll invest $5, $10, $15 million. We don't have a strong view on things like we must have X ownership, we must be in this round. We found, again, going back to it, be the people business. Of course, the best returns are coming from as early as you invest. But if you just invest in generational founders, it's... [41:50] tends to work out if you look back at the last 10-15 years for us and for for others. Anthony and I also have a lot of fun with the time that we spend on our seed fund. It's a 50 million dollar fund [42:02] We're typically investing $500,000, which means we're not leading. [42:06] We are participating alongside other great seed investors, many of whom we've known and worked with for 10, 15 years, 20 years. Dropbox has been a great fountain of producing VCs over the last 10, 15 years. So I get an excuse to work with many of my former colleagues still. Some which share my passion for product or for figuring out, cracking the early go-to-market for companies.

[42:36] every day and we've kind of tailored our fund. [42:38] Size and strategy [42:40] to really letting us do our best work and hopefully helping founders and letting them do their best work. [42:46] And which fund are we at today? Three. [42:50] Three. [42:51] Three and three. [42:51] Amazing. [42:53] So this is going to be a fun question because I think I'm going to get wildly different answers from the both of you. [43:00] With Brex, they're all about performance. And so they're the modern intelligent AF finance platform. But they they I always queue up this question because they're about performance. And I think part of performance is like who you surround yourself with and who you're motivated by and you're inspired by. [43:16] So from both of you and your backgrounds, who is someone that you admire most and you've learned the most from? [43:23] Somebody I know personally worked with? Could be anybody. Yeah. [43:27] You go first. [43:28] Well, I would say... [43:30] Again, as I said to you, I've had most extraordinary experiences. [43:34] set of mentors, partners over my career, [43:38] And I would give all of them... [43:42] you know, [43:43] uh [43:45] You know, I'm not sure that if I take the four from the past, I'm going to take the current out of the equation to answer that. [43:53] So, [43:54] I would say they owe all... [43:56] had equal [43:59] importance and value. [44:01] Um, uh, [44:03] Two of me, so Barry Diller, Michael Eisner, David Geffen, Steven Spielberg.

[44:08] The one that was most impactful for me only because I started when I was 22, 23 years old was Barry Diller. [44:16] Um, and, um, [44:18] You know, I worked for him for, you know, almost 11 years at Paramount. I started as his [44:25] you know, like, [44:26] gopher you know pa you know like i was like the errand runner or whatever [44:31] And he just invested in me and in my career. I think he believed... [44:35] and saw things in me I didn't actually [44:39] you know, seeing myself yet. [44:41] Um, and, um, [44:44] you know, really took a, [44:46] a very rough diamond and and i think honed it into something and [44:50] You know, by the time I was 30 years old, he had made me, you know, head of the movie studio, which is... [44:56] you know, [44:56] think about in the context of today is just mind blowing that, you know, I was, I [45:02] you know, running one of the seven studios, movie studios at that young age. Um, and, [45:07] So, [45:09] You know, I would, I, you know, I sent him, [45:12] I read his book. [45:14] uh, who knew, uh, when it came out last spring and, uh, [45:18] It, um, [45:20] It just really sort of moved me in a great way. And I actually sent them. [45:24] uh you know a very uh loving text out of that i've said it out loud at a conference so i don't mind saying it again which is [45:32] You were, you are, and you will always be the most [45:35] important mentor of my [45:37] lifetime and for that i love you

[45:40] Um, [45:41] You know, and if anybody knows of Barry Diller, he is an irascible person. [45:47] tough, grinding, hard, demanding... [45:53] uh, you know, person to work for. And for me, it was exhilarating. And, you know, I, uh, [46:00] just couldn't have done better in that environment. [46:03] You know, and so I would say probably Barry. [46:06] But I would say Steven Spielberg taught me as much about storytelling as [46:10] you know, anybody and [46:13] I learned about animation from Walt Disney. [46:16] He wasn't alive when I came to work there, but he had these amazing archives and [46:22] uh uh you know research material that i sort of poured myself into and learned all these breathtaking lessons [46:30] Um, you know, I just, I just, [46:32] Like this to show you the brilliance of him. He said, my movies are only as good as their villains. [46:38] So I would say to you, [46:40] Ursula. [46:41] Gaston, Scar, Farquaad, [46:45] Tai Lung, like I can go on and just name virtually every movie I've ever made since then, animated movie, [46:51] You don't have a great... [46:52] you know, antagonists, there's nothing for the protagonist to do. Right. So think of those pearls of wisdom. And so I've, you know, been lucky. I've had many, many, many great [47:03] inspiring people in my career. [47:07] For Sujay and me, [47:09] We were very fortunate to

[47:12] spent early careers at NEA. [47:13] and [47:15] learning, watching. And again, it's what they say and then you see how they carry themselves and act. [47:22] when companies are not going well and you have to [47:25] figure out what to do next. [47:27] Dick Kramlick and Scott Sandell. [47:29] That was just an eye-opening because it's actually irrational. I started my career in finance and you build models and you're like, [47:37] That is not what the next token would predict for what would happen to this company. And then Dick and Scott would say, no, we're going to do this. I believe in them. [47:45] And you can tell sometimes even the founders were wavering. [47:49] And they almost... [47:50] got confidence and belief. [47:53] from Dick and Scott. And that was what was incredible about it. [47:57] just watching them and the integrity, the way they carry themselves. [48:01] Then, of course, we went on our own journeys at Dropbox, but really coming back here in how we build companies, how we have to work with founders, all of those kind of memories, I think, come back. [48:14] So I think those two have shaped me [48:18] what Drew and Arash believed in [48:21] I stongedly about [48:24] first principles thinking [48:26] and specifically about talent, [48:28] uh it's now a common thing that you want to hire people successful company many of the folks that we hired and worked with have become [48:35] very successful wherever they went. But... [48:38] We and Drew and Arash took a risk on them. They did not have the fancy resumes and pedigree. Some of those profiles didn't actually work out for us. We bet on talent. And that was a big thing on them. It's like, generally, first principles are the most talented person, even if they don't have the resume and the pedigree to have done the sales job or done the international expansion job. Just bet on the person. And that's also shaped some of how we've hired and worked with our founders in terms of how

[49:08] hiring, growing their teams. [49:11] And again, that's not benchmarks. That's like recognizing humans as individuals with spikes and potentials for the right opportunity. [49:17] um [49:18] And then personally, lastly, this is one I share with our other partner, Jeff Nykin, is Charlie Munger. Just that… [49:25] super even keel [49:28] gratitude, but fierce curiosity about everything you do. It's like evergreen. And to just see what [49:37] he did over his career. [49:38] and all the things that didn't go right and his mentality. [49:43] through that is just so admirable. [49:46] along with Jeffrey's work ethic, which, uh, [49:49] is. [49:50] Insane to keep up with. [49:53] That's a struggle day to day. [49:57] That's amazing. Well, that's a really good place to end this. Thank you guys so much. It was a pleasure. Thank you. Good, good. Thank you. Appreciate it. This was fun. Hey, it's Molly. If you enjoy our interviews, check out our newsletter, Sorcery.vc, where we deliver a once a week top deals and tech headlines email and also go deeper on our podcast interviews. Subscribe to Sorcery today. [50:20] podcast on YouTube, Spotify, Apple, or wherever you listen. Link in description to sign up.