Interviewer: Over 70% of people in China are optimistic about AI and less than 30% in America were optimistic about AI.

Ben Horowitz: >> We have placed the largest bet in American history on the proposition that this country will win the next century of technology. We won the industrial revolution and we did that cuz we had superior technology and here we are on the dawn of a new technological revolution, the AI revolution. Every interesting company that gets started is a technology company. Now, America does give everybody a chance and entrepreneurs can really count on that.

Interviewer: >> If America loses its technology edge and its dominance, the entire world will lose as well. What makes the American system irreplaceable for the world at large?

Ben Horowitz: >> Everybody's in the same game, but the rules of the game have changed. And what I mean by that is,

Interviewer: >> so we've had a lot of uh excellent discussions. We've talked a lot about policy. Uh but we're actually going to start this more on the uh venture capital and and technology side. Uh you recently shared a blog post of the firm has raised over $15 billion in a new fundraising uh set of set of funds for uh uh the firm, the largest in A6Z history. What do you think are the new obligations that come with that kind of scale? Uh we are the largest venture capital firm in the world. Uh and how does that uh tie into the mission?

Ben Horowitz: Yeah. So, it's interesting. My my old mentor Andy Grove said to me, he said, "Ben, when you're a leader in an industry, then the whole industry, um, the size of it, the ethics of it, the morality of it kind of depends on you." And I remember thinking when he said that to me, he was running Intel at the time, um, I thought, "Wow, I'm glad I'm never going to be the leader of an industry because that's a lot of responsibility." Uh, but here I am. here we are. Uh and I think you know for us you have to take a step back and say okay for the technology industry and particularly for kind of new technology companies um what does it need to be and you know you have to think about it on a large scale and and the way we've been thinking about it is well if you go all the way back to humanity like what's important for humanity what advances humanity and it really kind of comes down to um do people have a chance to contribute because when people have a chance to contribute then they can have an impact and then they can kind of advance the state of things for everybody. Uh and there's really been no country um in the world that comes close to uh America at giving people a shot. Um you know giving them a chance to succeed and you know it's not a completely equal chance. Some people are born rich, some people are born poor, some people have better genetics, some people uh live in dysfunctional families and so forth. Um but a chance uh and most countries uh people don't have a chance um you know or they have a very small chance, a very slim chance. And uh and so that that ends up being really important. And then if you think about why does America have the influence it has today from a military standpoint, from an economic standpoint, from a cultural standpoint, it comes back to well, we won the industrial revolution. Um, and we did that because we had superior technology. And here we are on the dawn of a new technological revolution, the AI revolution. And are we going to win? Um, and are we going to have that influence? And are we going to be able to give people a shot? and kind of to continue to advance humanity. I think that's an open question right now. And so when I think about our role in the industry, it's what can we do to help America win technologically? Um and that's that's everything from what we invest in to how we integrate into um the government and make it accessible to all the citizens and in you know integrate with our allies and so forth. And so it's a big mission. Um it's a lot of work. uh and you know it's what it's why we American dynamism in the conference and everything.

Interviewer: >> Yeah. We you you know you have said that the American way you know giving people a shot uh that if we lose this technology race if America loses its technology edge and this dominance that the entire world will lose as well. What what makes the American system irreplaceable? Why is our techn technological dominance not just good for America but actually good for for the world at large?

Ben Horowitz: >> Yes. So I think a lot of things go into it but to to me it always comes back to there's a line in the Declaration of Independence um that is very well known but um also underrated which is we hold these truths to be self-evident. And what does that mean? Um well it means that you know these truths didn't come from us. They're they're truths they are self-evident. They came from a higher thing. They came from God. We didn't make these rules. We didn't give you these rights. We didn't give you this freedom. Um it came from something else. And that's really really important because it means like if I'm the president, if I'm Congress, no matter who I am, I can't change it. No matter how much I want to change it. And you know there there are many uh who who would like to change some things who think they know better um than each other. Yeah. Yeah. And you know like that is a thing.

Ben Horowitz: >> Um but because of that uh those the freedoms that you have in America can are really really protected to a degree that they're not in any other country and they're very hard to lose. And we've seen this you know um there's just a great talk about free speech. We've seen this with free speech where countries are like, well, you know, maybe that's not such a good idea anymore. But if uh the if it can't be taken if it didn't come from people, it can't be taken away from people. And that's been very very powerful and very persistent, I think, over the entire uh history of the country. Um and and it's really unique. Uh you know, there there aren't other countries who have uh quite as strong a version of that.

Interviewer: Absolutely. You've seen since we've launched uh you know it's now been four plus years since we launched the American Dynamism practice. We're on our second fund. Uh you and and Mark have been incredible supporters of this effort uh of investing in the national interest at the intersection of advanced uh software and hardware and you know rebuilding not just the defense industrial base but manufacturing and and all the the precursors that go along with it. Um, what's been most surprising to you that you've learned about investing at these intersections of national security and venture capital? You know, along with it came a big presence in in Washington. Uh, so what what what's been the most surprising? What do you think the biggest learning has been?

Ben Horowitz: >> Well, you know, it's been interesting because the if you go back to kind of pre-Chat GPT, the conventional wisdom was, you know, China had this big AI lead on us. Um and then chat GPD comes out and says oh well maybe no we have a lead on now and then you know things have evolved from there. But the the thing that was true about the kind of old incorrect idea was that they were way ahead of us in integrating um their AI technology with uh their government you know on a kind of military basis on a bureaucracy basis you know and all facets and so you know when we started we were coming from I would say very far behind you know in that you know in that idea um the thing that's been surprising though is like how fast um we've been catching up. Uh and I think that that's been really kind of heartening from both the number of entrepreneurs that want to help and then um the willingness of the US government to say, "Hey, we're interested in these new technologies. We're interested in these new companies. We're not stuck in our ways. Um we'll change the rules if we have to." And that's been uh you know it's been amazingly fruitful and I think that you know we're seeing it in the kind of current conflicts that we have uh and um you know it gives me great hope that you know if we keep at it that that we'll be very strong going forward.

Interviewer: >> Yeah, I agree. I think this is a moment of optimism to see just how quickly things can shift uh when there's a sense of urgency and and a sense of change makers. Uh I want to talk about AI and policy. Uh we had uh Emil Michael earlier, the under secretary of war for research and development, CTO of the department of war here. He was obviously in the news uh talking about anthropic over the last week, but this isn't an an issue. It may have bubbled up to the mainstream news in the last week, but this has been an ongoing issue. Um let's just actually talk about anthropic and AI that's like directly headon right now. Yeah.

Ben Horowitz: >> Um and then we'll talk broader about policy in Washington.

Ben Horowitz: >> Yeah. So, look, I think to to me the thing on the whole anthropic kurfuffle um that nobody's really said out loud, but is the obvious thing that happened is, you know, if you understand deals, particularly software deals, you realize that that deal did not fall apart because of philosophical differences. It fell apart because Ananthropic wanted out of the deal. Um, and you know that because they had all the leverage. you know, they were already deployed. We're about to go to war. Like that, nobody's ever had more leverage than that in a software deal. Um, so anything reasonable that they would have asked for, they would have gotten like even probably beyond what they should have. Uh, but the fact that they, you know, found something they could walk away on and then didn't return a meal's calls for whatever the three calls and then the call to the admin or all those things that happened. It's just why would you not return the call if you want it in the deal? they they just wanted out of the deal. Now, I don't know why they wanted out of the deal, whether it was an employee thing or Daario thing or what have you, but you know, that's what happened. And I think the fact that it's getting reported on like there's some ethical conflict, I don't think there is. Um, I think that and in fact, if you wanted to somebody to use your AI safely, nobody has more rules than the US government, you know, particularly the Department of War. And nobody is more by the way. And then and since I'm speaking to a Washington crowd, you know this. If you were to break those rules, there is a 100% chance it's 100% chance it's getting leaked to the press immediately. You know, like there are no secrets in Washington. So, you know, that the whole thing was a little bit surreal to me to watch at at least at this point.

Interviewer: >> Well, what what do you think that is there anything that uh founders should be thinking about? people that want to sell to the government, work with the government. Um, you know, h how should they approach it inside their own companies, do you, you know, maybe anthropics a one-off? Yeah. Uh, but you you and I have been in Silicon Valley long enough to know that these issues tend not to come up and go away. They tend they tend to they tend to stick around. What would you say to the founders that want to build for the national interest, but you know, still are coming from a Silicon Valley mindset? What do they need to think about? How should they talk to their teams? you know, how how can they build the the products that are needed for our government to effectively have the best and and most capable technologies?

Ben Horowitz: >> Yeah. So, you know, it's interesting. Um, when I spoke to the firm about it the first time when we started American Diamond and so forth, I said, look, you know, like you can have whatever geopolitical views you want to have, but like the world is what it is. You know, it's not like everybody has agreed on peace worldwide and it's not as if everybody's agreed not to commit crime ever. Uh so like we do have crime, we do have war, we have these things and then you have to think about okay the people that we grew up with who have gone into the military risk their lives to save our lives. You are making the call because you are better ethically and you know more about geopolitics and the people in the state department and the people running the department of war and the people running the intelligent agencies. You're going to decide that those people who are sacrificing their lives, putting their lives on the line to protect us don't get the best technology. Like I'm not doing that. I'm not doing that. So like you don't have to work here if you want to do that. That that'd be crazy.

Interviewer: >> Yeah.

Ben Horowitz: >> Think you know better than the State Department.

Interviewer: >> Yes.

Ben Horowitz: >> Yes. Yeah. I mean, we we have this issue. I mean, you know, we're we're board members of these companies and you know, the the founder will call us, the CEO will call us and say, you know, I have some employees that don't think we should do business with this country or this country. And it's like, are are you the State Department? Do you know better? That's crazy. And by the way, what a slippery slope to go down. You don't like you don't want to be in that position.

Interviewer: >> Yeah. These issues are complicated. I mean they really are complicated and I think that these uh

Ben Horowitz: >> you know this dime store morality or that that uh companies come up with you know it's it's like a vibe vibe vibe geopolitics

Interviewer: >> right that's right okay so we call it we call it I want to shift gears a little bit we call it American dynamism uh but it is more than America it's about America and her allies uh you have spent a lot of time I know this because sometimes I join But I also get a little bit of visibility into your travel schedule. You've spent a lot of time on the road internationally. A lot of foreign leaders come to you and they say, you know, we want a startup culture. We want American dynamism. Uh we want to, you know, reinvigorate a startup community, do manufacturing, build for defense. you know, how do you think about how can we export uh our capabilities, our advantages, our culture uh to these other countries, especially ones that we may have supply chain dependencies on and who are our allies, especially ones that are that are connected to us like Mexico, Canada, you know, Latin America. How how can we take America American dynamism abroad?

Ben Horowitz: >> Yeah. So, you know, it's an interesting question. I I don't have a full answer because we we haven't quite entirely figured it out, but I I'll say this, you know, we because America does give everybody a chance and entrepreneurs can really count on that. I mean, that that's a thing like if you're going to basically bet your whole life on an idea and going to build something, you kind of have to have the you really have to believe that the government isn't just going to arbitrarily take it away from you at any point. And there are very few countries that have that going for it. So we are um reasonably unique. There are there are a couple of places uh that have great technology entrepreneurship. Sweden is one, Israel's one. Um but but it's pretty rare around the world. Um having said that, you know, there are there is great expertise in things that um you know, we need help with particularly to industrialize. So in Mexico uh they are they do have really good you know high quality manufacturing expertise in some ways. You know I think the cars that come out of uh the American cars that come out of Mexico are better than kind of uh the kind of Chinese manufacturing on on many fronts. So they do have talent. They are partners. Um they want to work with us. We need to help secure that country because uh you know it's a border but it's not a thick border. It's a thin border. you know, we have a lot of people vacationing down there and whatnot and and so that's a real thing. Um, you know, similarly, Japan, you know, they've always loved robots and they're really good at manufacturing and, you know, we have a big deficit on the kind of robot supply chain. So, uh, you know, we're working with them at the same time. Uh, they just went from 0% of GDP to 3% of GDP spent on defense. We have a lot of defense companies. Their interests and our interests are very aligned when it comes to China. So I think there are some great opportunities um you know both kind of for us as a firm our companies and then the country and working uh with allies around the world.

Interviewer: >> Yeah, the the the recent advancements in robotics we haven't spent a lot of time talking about it today. Uh I'm sure we will next year, but it's really feels like we're on the precipice of a robotics revolution and uh it's going to be very very exciting to see that play out and and for sure uh a lot of our companies and uh a lot of our allies will have a role to play.

Ben Horowitz: >> In a in a recent uh deep dive, you know, Py McCormick did this long deep dive on the firm. Thought it came out pretty well. Uh he described the firm as a power broker using capital and networks to shape markets and influence. How do you view that and balance that power with the need to remain authentic to our founders uh to institutions? How do we leverage that power? How you know obviously we're here in DC. Um how do you think about that responsibility and how do we use it to to advance uh the state-of-the-art?

Ben Horowitz: >> Well, kind of what you lack as an entrepreneur is power. So you have a great invention. Um you may have built a great technology, but you don't have uh kind of the power to call anybody. you you don't have the power to kind of get the right meeting necessarily um with the right people in Congress to kind of help get the regulation correct. Um you know you you don't have the power to get a an audience with the right CEO to buy your product and that kind of thing. So power is sort of a feature of our offering is the way I think about it. And that's very different than the culture that we want to have and want to project internally. And as you know kind of our very first kind of cultural idea is first class business and only in a first class way. And what that means when it comes to entrepreneurs is the ultimate respect for what they're doing. you know, it doesn't mean we're always their best friend or anything like that, but we um we show up on time. We get back to them in a timely fashion. We're honest. Um we do all the little things to make sure that our overall behavior isn't we're the powerful and you're the weak. Uh because, you know, that obviously would be a short a short uh ride for our firm at the top.

Interviewer: What what do you think about uh you know as people watch us raising so much capital uh it happened during a period where you know I think broader the VC industry had slowed down fundraising uh but we closed very quickly uh we raised a massive amount of capital uh do you think that signals anything about where venture is going as an ecosystem as an industry um what is it what is it what do you think it looks like in the state of venture capital today

Ben Horowitz: >> yeah so this is something that we've seen been coming for a long time and that we kind of prepared for us. So if you go back to when we started the firm, there was the the there was a study that was done um that showed that in any given year, there were basically approximately 15 companies that would be started that would ever achieve $und00 million a year in revenue. And so the whole idea of venture capital was that you had to get in as many of those 15 as possible. And you really didn't want to be in anything that wasn't one of those. And so the way uh venture capital firms were constructed were as these uh partnerships in both economics and control um that were small because you know why have you know 100 or 500 or 600 people like we do now if you're only going after 15 companies. it doesn't make sense. Uh but what we saw back then was well even though that had been true for decades, it wasn't going to be true anymore because uh as uh Mark wrote, my partner, your partner, software is eating the world. And so what that meant is that there was going to be no industry, no company that wasn't going to be better um if there was a if there was a great software team at its core. And you know that that's even evolving now into AI. And so basically every interesting company that gets started is a technology company now. And so there are many many more interesting companies. And so in order to reach it, you had to be able to scale uh your organization. Now here's the problem. If you were one of those venture capital firms that started all those years ago, um you were likely set up, as I said, as a partnership with shared economics and shared control. If you have shared control, it's very hard to reorganize. Um because and and you know this, David, as a as a CEO, to reorganize, you need a single decision maker. There is no way to reorganize. Um if everybody gets a vote, it's going to be bad. Uh I could write a whole book on just reorgs, but reorgs are essentially uh redistributions of power. when you redistribute power, people are mad if they get a vote um that they're going to foul that that that reorganization and you can't scale without reorging. So as a result like we've been able to scale uh because we have centralized control but you know most of our kind of competitors have not been able to scale like a very few have and so I think what we have now is large firms um who can cover all the technological areas and then specialized firms that are okay I'm a specialist in AI infrastructure I'm a specialist in bio or I'm a specialist in crypto where I'm a specialist in games, but I'm not doing all of that. And uh and the kind of firms in the middle I I think are getting squeezed out.

Interviewer: >> I think that's right. People uh people sometimes ask me like, "How do you work at such a a massive uh firm, you know, 600 plus people?" And I say, "Look, well, we're actually a bunch of really small teams that leverage a bunch of shared platform services, much like our portfolio companies. And that allows us to move with urgency but have the might of a very very large organization behind us. Um I think one of the other things that uh I think is interesting that people don't always realize about the firm is there's probably more CEOs in as as general partners inside the firm than it's got to be than any other firm. And I think all of us recognize having a hierarchy and a benevolent dictatorship is really appealing. You don't

Ben Horowitz: >> Yeah, it works.

Ben Horowitz: >> Yeah, it works. And uh you know it makes our life easy. my job focus on American dynamism. It's very simple. You know, Martine's job focus on infra and being the best you can be. Figure out what we need and then uh it it it really is a dynamic that I think these uh the sort of death by committee kind of venture firms just cannot uh adapt to.

Interviewer: >> No, definitely. >> You've talked in a recent podcast about how the media landscape has shift uh shifted how reputation can shape markets. We had Alex Karp here earlier today. uh he is uh phenomenal about going direct uh to to his customers. Uh how how do you think that that shift it seems like we're seeing that shift in some ways in the government a Michael going on X directly uh how would you coach founders uh and even maybe coach people that are in the government uh where narrative and trust is paramount uh in terms of communicating and thinking about media and communications.

Ben Horowitz: >> Yeah. So look, I think that the the media world has changed and you know, it can be confusing because I think that um you don't need to think about in terms of necessarily old media and new media and that everybody's in the same game, but the rules of the game have changed. Uh and what I mean by that is in the old world, um the key to a media strategy was defense. Uh, and the reason that the key was defense is there's a limited number of channels. Um, those channels have very strict formats. So, if you're in the New York Times or the Wall Street Journal, you can get a few quotes in and then you'll be characterized on the rest of what you say. If you're on uh CNN, you get like a short and hostile conversation uh with a bright light in your face and and so forth. And then because there was a limited number of channels, if you said something wrong, you couldn't erase it. It was kind of like on the permanent record. And there are kind of many cases of these old school gaffs like Howard Dean and so forth where you can never erase and you can never get over it and so forth. In the new kind of world, there's unlimited channels. There's unlimited formats. Um, and so the key to winning isn't not making a mistake, it's being interesting. Like if you don't say anything that's interesting, it's not going to get any pickup because there's too many other interesting things out there. So people like Alex Karp and Donald Trump and so forth who are just like a entertaining show. Um like Alex was super entertaining out here. I was like captivated. I didn't know what he was going to say next. Uh

Interviewer: >> I I don't know if he knew what he was going to say next, but it was really he he is very entertaining and that wins. And then like if you make a mistake, you just do 10 podcasts tomorrow and flood the zone. And and and it doesn't matter like whether the channel is the Wall Street Journal or or a podcast or whatever. It's all the same thing now. Like because that's the way you're overwhelmed with media. And so to win you have to be interesting. Um and then you know that doesn't mean you can just be all over the place and not be on message. Alex is always very very very consistently pro-America. Like that's the thing that you can always count on him to be and that's his main message. Um and that's great and he's interesting about it. He's got a great knowledge of history and all these kinds of things and so forth. Awesome. Uh okay.

Ben Horowitz: >> So we have placed the largest bet in American history on the proposition that this country will win the next century of technology. Uh so what and I and I do feel very optimistic. I think you you you and I have are both optimists. I think our firm is broadly very optimistic. In fact, I would say that's that's ultimately even a core value of the firm is being optimistic about the future.

Interviewer: >> Yeah. >> And uh but what keeps you up at night? What worries you? What uh what would you ask of the audience? Uh some of whom are founders, some of whom are policy makers, uh some of whom are implementers. What what worries you and keeps you up at night and what can we do to help?

Ben Horowitz: >> So actually my biggest worry is kind of the perception of technology in America. So there was a interesting kind of poll that went out that showed that like I think over 70% of people in China are optimistic about AI and kind of less than 30% in America or something like that were optimistic about AI. And it's really because we always talk about all the bad things. you know, we're we're very focused on the dangers of AI here and not on the positive things. And it's interesting. I I just spoke to someone from Japan who was like, you know, the whole Japanese startup ecosystem is restarting because everybody's so fired up about AI there. We're all very positive on it. We love robots. You know, we can't The Japanese love robots, by the way. Uh and you know, I think we really need to focus. Somebody asked me the other day, well, what good can AI do? And I was like, well, we can we're going to not just we can we're going to end traffic deaths. We're going to cure cancer. Um we're we're going to end poverty as we know it. Like those are pretty good things. Like we need to think about that uh as much as we think about um you know the AI overlords or um mass surveillance or or any of these other things that we worry about. I think that that the positive uses of the technology are extremely positive. the negative ones aren't there, but we can manage them uh in the same way we've managed, you know, kind of the negative of every technology, starting with fire, which has very bad consequences, can burn down your village. It's horrible. Uh but it does a lot, you know, it also heats the house and cooks your food and does some very wonderful things. And and I think we have to get back to that.