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The many lucky accidents of Chamath Palihapitiya
ICON - Israel Collaboration Network has done it again!
This time, it is the fireside chat with Chamath Palihapitiya.
Interviewed by Oren Zeev ( Zeev Ventures ), Chamath shared with us his “lucky” accidents, his view of the markets and the future, and where he's hedging his bets.
As a huge fan, I must say this fireside chat has been very special. Chamath has opened up and given us a glimpse of his personal journey and vulnerable side.
Among the many stories, his launch of Social Capital has left me with the deepest impression. Despite being a successful executive from Facebook, Chamath had yet to find his own edge in VC. He admitted that his lack of confidence has led him to follow the general investment trend at the time ( bitcoin, cloud, saas ). Since he did not go to an elite school such as Harvard or Stanford, he would often hire from these schools. He did this because this is what other Silicon Valley VCs do.
While there were some great wins ( Slack, Yammer ) from his earlier portfolio, it was not until the later funds that he achieved the most success. As the sole LP ( limited partner ) in them, Chamath is able to develop his unique strategies and hone in on investment opportunities such as sustainable energy and biotech. With little overlap with other leading VCs’ investments, Chamath’s portfolio was able to stand on its own, allowing him to achieve alpha
What happens in markets is that when things go down, the things that are highly correlated go down the most. Because they are the most highly trafficked which means they are the things that have the most investors, which means that in an upmarket, they have the propensity of having the highest prices
Chamath explained in his weekly All-In podcast the negative effect of a highly correlated venture portfolio
Explanation of the overlap coefficients starts at 45:45 of this episode of All-In Podcast
With a strong sense of validation of our strategies, I left the event very much inspired.
Luck may have played a small part in your success. But it is your humility, your deep desire to grow, and your hard work that has made you become who you are today.
Thank you, Chamath!
( Update: The video recording for the fireside chat is found below )