Rich Barton Talks About His Startup Companies

He is on the board of directors at Netflix, and he is a partner at the venture capital firm Benchmark Partners. Richard Barton, Welcome to Bloomberg. Thank you very much for having me on. So I've been looking forward to chatting with you about so many different things. I have to start though, there's such a Your background is so start up oriented, and yet you graduate Stanford at eighty nine with a degree in engineering you end up at Microsoft. What was it like working in Microsoft in the midst

of the nineties when everything was on five? You know the power we with which we view Facebook and Google and Apple today, Imagine all that power wrapped up into one company and one company. That's what Microsoft was with one person at the helm, who really was running the show, who really was running the show involved deeply. When I showed up, there were about three thousand employees, so it

was relatively relatively small company. Um. Now, tech wasn't as pervasive as it is today, but Microsoft was by far the most important company in the technology world and basically building the future. It was quite exciting that, that's right at the process as tech became more pervasive meant that a ton of money was flowing into their coffers. And before the iPhone there was really nothing ever like Microsoft before.

That's right, I mean IBM. You could argue em had a pretty good position prior to Microsoft, not on the consumer side, but never on the business. And it wasn't as big a business, right, It was a much smaller business. And it was whether we're talking typewriters or mainframes, there was still an aspect. It wasn't the dominant technology of the day. So so what did you do with Microsoft? My first job at Microsoft was product manager of MS DOS five. So you're the person I should have been

sending those nasty letters. Do you even do? Do you know what the big feature for MS DOS five? I do that much of a geek. Uh was this pre shell? Is that what we're talking? Well, there was a shell that we have this weird shell. There was no Windows, way before there was no Windows. But I feel like three one as we're really that's that's Windows three point one, which was a couple of years after Horrible that. I remember that well, it was a big event. These were

consumer ending events. And MS DOS five upgrade was the first operating system that Microsoft sold at retail as an upgrade, and they did it to break the six forty K barrier, which they are about five percent of your listeners right now that the computer was using and got it. I'm

m dot sis. And what this enabled was these older PCs that were getting obsolete to load up this this new upgrade, which was a very hard process to do, kind of imagine lifting a house, pouring a new foundation and dropping the house back down onto It was hard, but it allowed them to run bigger programs faster, and people lined up around the block at midnight outside of Egghead, So I remember that. I mean, it was nothing like when you know the Rolling Stones. Start Me Up was

the theme song, and it just went utterly crazy. I was the lonely Mac guy during that era and actually thrilled when when the deal was cut in ninety eight, jobs came back and Gates essentially, I think intelligently made the bet that hey, if Apples around, we're less of a monopoly because look, there's a credible consumer competitor, and that's why that deal was made. That investment. Yeah, a guy named Greg Maffei who I'm on the board of Liberty Interactive as well, and Greg is on my board

at Zillo. He was my first chairman at Expedia. He's the guy that led that investment, uh, for Microsoft and Apple. You know, it's too bad Microsoft sold that position. It would be worth um quite a large time. I'm told they did well. Microsoft. I'm told they were accounting reasons. Why once it just starts becoming an outsized portion of the balance sheet, it's all right, this is problematic. Let's just liquid dated. Not that they needed the money. They've

been a cash machine from day one. So, so you've been a CEO at a public company. What is that process like and and why are so many companies reluctant to go public these days. I'm one of these guys who thinks when you take a company public, you're making it to the majors. It's like going from the minors to the majors. And you know, I grew up in a time when that was the dream. Uh. Plus, your

backers would like to eventually. And I actually feel a responsibility to the people that actually invested in my companies and by the way, my employees, who I've paid in stock options in part. And so I believe it's my responsibility as an entrepreneur to figure out how to get a company public so that you know, to reward these people.

But I also believe it creates optionality. And when you have optionality to buy companies with stock, to issue stock, and to to raise cash, it gives it creates value. Optionality creates value. And so I'm a big fan of being public. I also believe that this quarterly reporting stuff is great discipline and having auditors in your operation. You know, even me as a CEO, I'm happy to have auditors and they're just to kind of be digging through and

looking for stuff. And and now I understand why you've been the IT of three successful companies, because you understand things that other people seem to just complain about. When I when we see companies startups say it's too onerous, it's too invasive to go public. What's your response to that. I mean, can you imagine Tom Brady in college? Where was he in Michigan? I think saying I don't want to go pro. You know, you know, it's too much pressure. Everybody.

They're writing about me. There are people on the radio making fun of me and how I played over the week. You imagine that anyway, that's kind of the pervasive attitude right now. Our vcs, ore vcs encouraging that attitude or do they want to go public as much as the next well earlier stage vcs absolutely want their companies to be public so that they can get liquid their business. Right.

The the issue is there's been in the world's a Washington capital as as you and your listeners well now, and there's been a flood money into late stage private investing, okay, and those people don't want this IPO problem to go away because they're getting to invest that they're getting to write hundreds of millions of dollars, if not billions of dollars checks and companies like Uber to get into the

cap table before the public does. And so that flood of capital into late stage private has made it easy for an entrepreneur to say, uh, I'm not you know, I'm not gonna go public. I'm gonna stay private. They're letting them cash stock out their founders that in these late stage deals they get to sell stock, and so, well, what incentive do I have? You know, if the CEO is is getting liquid prior to being public, then what incentive does the CEO have to actually get public? So

there's a there are a myriad of problems. I guess I would also it could be an interesting conversation depending on how you feel about it. But I feel I feel that the the the regulatory burden is and the legal burden is high. Okay. Now, any one regulation, if you looked at it on its own, UM makes sense. Okay, any of these regulations, but in totality it is quite crushing. Uh. And the lawsuits that that that ensued because of these

regulations as well, that is quite time consuming. And a lot of people look at that and they say, well, I'm not gonna be public. Michael Mobison, who I know you've had on published paper. He's terrific. He published a paper six or eight months ago, Uh, basically saying they're they're less than half of the companies. They're less than half the number of public companies today as there were fifteen years ago. I may I may have that wrong, but some okay, Um, we have all the public exactly okay.

And so they I think that the the industry if they're lobbying for more shareholder activism and more ability to put people onto boards. Uh. And as as as this money floods into activist funds, what they're doing actually is kind of killing the golden goose. They're they're driving companies out of the out of the public markets. So let's talk a little bit about Zello, which I find to be absolutely fascinating. First, what inspired this, right, I mean,

it's a segment too. You're not the only one that finds it fascinating. Very We get over one hundred and seventy million visitors a month to our portfolio of sites, and we we don't only truly a street Easy here in New York City, which was a really really great acquisition nobody noticed. I mean, you don't have multiple listing services in big cities. It's a very closely held thing, and they're one of the few entities that track big city. I know they started in New York. They did. Then

they nailed this vertical living, yeah, really did. But they had trouble expanding me on New York. Uh, and so we met up with them. We got along with um. The founders wanted to get some liquidity and we and we bought it maybe five years ago to that was a really wonderful thing. And there's another brand called Hot Pads and Naked Apartments that we own, so we have a portfolio of brands. What got it going, however, was my personal frustration with not being able. I was shopping

for a home my family. I just had twins. You live where no part of the country. I live in Seattle, Washington, lovely part of the from the world, one kid to three, and I was shopping my my co founder and I were shopping for homes together. We both just left Expedia after having a really successful leadership, and so we're looking for homes and we can't believe. And this is like two thousand four, two five modern era. It's like the web has been around for at least ten years at

this point, and so where's all the information? What where is it? It's like it's like it's like it was when we started expediing it. It's like, I can't access that the information that I want to see prices, I want to see schedules. I want to do it myself. I want to take control. People want control. I want to control. My partner, Lloyd wanted control. And we said, all right, well this is broken. You know there's something going on here that's broken because this information, if you

dig hard enough, is available. And so we built spreadsheets, We went to the county websites. We started doing dollars per square foot. So we're just trying to figure out what we should pay for a house. And so Zillo was born of this, this frustration and this desire for to to be empowered with information. And once we got it all together and we figured it out, we're like, well, why should you have to be a spreadsheet geek like us, uh to be able to get this and we said

we kind of slapped our heads. We found this estimate. We kind of stumbled into this estimate UM. And once we stumbled into thet this estimate is an estimated market value of every home in the country that we update just about every night. UM. We kind of had on

the whiteboard we had a stock a stock chart. So this is this isn't this isn't a time when the real estate business was going, you know, the real and everybody's most significant asset if they owned a home, was their home, and people were wanted to know what their home was worth. So they're watching the market, and so we thought, well, why shouldn't you track the value of a home like you like, like you track your portfolio. But you guys pivoted complete letting. His estimate is still

part of the ZILO. But I would say it's it's now probably the least significant daily usage. That a fair way to describe it. I would say that is a fair way to describe it. It's mostly people who are shopping for rentals and mortgages and homes and people who are selling those properties. But but we envisioned right from the start that this estimate, which was a missing key piece of marketplace data, could in fact be at the core of a new real estate marketplace, a digital one.

So the question, I have so many questions about this subject. The data that you wanted was clearly in existence, but it was control by the National Association of Realtors. I believe they're they own the multiple listing service, or they're affiliated with it. Not really, actually it's quite separate. In fact, there is not even one MLS. There are nine in their own by broke regional brokerages generally speaking. But the n A R has clearly has influence, and you guys

eventually tapped into all of that. UM, we eventually got all that data. But what we did was we we didn't show up to the pot luck with just a fork. Dave Linegar, the founder of Remax, is a colorful fellow. Uh upbraided me publicly early on by telling me I had shown up to the pot luck with just a fork, because if I could come into his business and just use his data and then get users and then turn around and charge charge him for advertising. But that's not

the case. We brought pot roast and marshmallow jello salad. We brought this estimate, and we brought this huge database of all homes, not just the small number it's for sale right now, but a database of all homes. And it was a living one so people could add to it. A new data kept coming in and finally, UH the industry, in a very complementary way, realized that this data was really important to buyers and sellers and agents alike, and

eventually everybody ended up participating. So the Zilla, I'm not exaggerating. The Zillo app is literally on the home screen one. Is it screen one? A screen too? No, that is screen one. There you go. It's um like Zilo, son nos and uh sky something I don't remember it is um So let me three of I don't EXPEDI is sort of before my time. I know that sounds ridiculous. We'll talk about Expedia soon. The three ways I use

Zillo constantly constantly. First, any time you're driving in a neighborhood and you see a nice house or something right, and I love to just you know, my mother was a real estate agent. We own a couple of homes. I'm very much your target real estate junkie audience. So outcomes the app. And as long as there's some connectivity, UM mobile telecom in United States is an embarrassment, but

we'll save that for another podcast. Hey, they're all the houses that are for sale recently sold, and you could you could see the prices and what have you. It's really fun to do that on a boat out in harbor because you could actually see the houses that you can't see from the road, like they're down driveways, behind edges, they're invisible. That's a ton of fun. How do you find people generally use the app? And what I mean by that The obvious is I'm looking for a house.

What other ways have come up? That might have been someone unexpected? H The development people and universities and philanthropies use it to target to target people. That's interesting, divorce attorneys, I'm I'm kind of joking. Uh. There are so many uses for Zilla, both as an entertainment, as as information and as entertainment and to inform a shopping process, be it a casual shopping process or a or a serious

shopping process. Not to mention, we're the largest rental site network of rental sites now, so you know most most of the growth in households right now is going to rentals, and so rentals has become quite a big business. Always has been UM and mortgage shopping people do. But it turns out that our homes are not only where we lay our head, they are our entertainment. Look no further than HGTV and all these worm shows on they are entertainment. We love to track the value of it too, because

it's for many of us, our our biggest asset. And so this this kind of intertwining of emotion and financial importance. I kind of view it as a year and a yang. This is really quite a sweet spot in consumer products that I look for. When you have both emotion and

financial significance, you have a potential huge idea. So we moved a couple of years ago, and we when we were selling the previous house, we brought in two different real estate agents and we surprisingly received wildly disparate estimates from each of them. And again, my mom was real estate agent. I grew up with dinner table conversation about what terrible people some agents um, what terrible behaviors some

agents exhibit. I mean that was literally dinner conversation. And so when we got these different estimates, I said, let me play with Zello a little bit and see what I can do. And the first thing I did was come up with a I searched for our house number of bedrooms. Bathrooms were a kitchen deck proximity to the water. I tried to make it as close as humanly possible as I could, and then that generated two lists. It generated the list of homes that were for sale in

my neighborhood and surrounding towns within my price point. But it also generated a second list of homes that were sold with the same characteristics. And so you get these two data sets, and then you look at the overlap and lo and behold, if you want to sell your price at them, the get the maximum return on the sale in the fastest amount of time. You could wait six months and maybe get another ten or twenty grand.

But if you want to be right in the sweet spot, and we literally sold the house within ten thousand dollars of ask in three weeks. And I have to give thanks to you, guys, because that would not have happened without you, guys. Very that scenario is exactly why we built Solo. That's exactly it. You were fully empowered to look at all that data yourself in a way that you could understand it and didn't exist a few years you weren't able to access that information before. That is

power to the people. I love, love, love that we really have this you know, this ethic at this think at Zillo and all my companies, where we want to empower regular people with data and tools so that they can make much better decisions about big, important financial stuff. Let's talk a little bit about Expedia, because that's a fascinating story. You're working at Microsoft. They are not exactly a startup culture by that point. They're they're the eight

pound guerrilla. How did Expedia come about? I always had the itch to have my own thing. I always wanted to start my own company, and I was going to do it somewhere um and the Internet was just happening. The Internet hadn't quite the graphical Web hadn't happened yet pre Netscape, so this is pre nat scape. But post Prodigy and a O l okay so compy survey, well Prodigy, these were the big services, and I was fascinated by them.

I really thought, Wow, these are empowering, this is something some thing interesting is going to happen here, and this tool here could lead to some new industrial revolution. I was thinking pretty grandly, like what could happen to the travel industry? Uh? If people had access to all this data? What could happen to real estate? I was even thinking about real estate back then. I wrote a plan to to have an electronic stockbroker because I like to trade.

Trade and investor is pre e trade. This is pre e trade, but but e trade didn't even exist. But I was a Schwab customer, and I was one of those Schwab guys that used telebroker. I would trade with my finger, you know, on the on the keypad, because I don't really want to talk to somebody. I knew how to do it myself. I wanted control anyway, So I envisioned that this online thing might turn into something

pretty interesting. I wanted to be an entrepreneur. I was especially frustrated as a traveling young businessperson with the interactions I was having with my Microsoft corporate travel agent. I could someone in house who would book travel for in house or working for American Express, but basically assigned to

the Microsoft account, and I'd call her up. Usually it was it was a woman, but there were, you know, many different people, and I'd hear the keyboard clicking, you know, as I was asking questions and Seattle, then Denver, and then I gotta go up to Chicago, back to Seattle, and I'd hear these keyboard clicking. I'm like, you know, she answered me with one choice, and I'd be like, well that it can't be the only choice. You've got

a screen full of stuff in front of you. So I wanted to jump through the phone line, turned the screen towards me and take control of myself. Okay, So that was the inception of me being going to UH to Bill Gates, who I view as my first venture capitalist, and Steve Bomber was in the room too, UH and pitching the idea for for what became Expedient. So tell us about that meeting. That has to be a seminal moment in your career. It was. It was not you know, I did you realize that at the time, or was

it like I just gotta get these guys to sign off? No? No, no, it felt special to me. I knew I had a I knew I had a potential tiger at the tail I did, and and I actually wanted to convince them to that it wasn't going to really be a software business. It was going to be a travel business. And I wanted to build a fund me on the outside to do my own thing, because at this point Microsoft was getting bigger and the stuff I was working on I was paid in stock options. But the stuff I was

working on, you know, it wasn't Windows. At the time, and so really it would only matter how windows in office, did you know, versus two relative to my compensation. So I was thinking, well, if I can do this on the outside, if I if I can build a team and do really well with this, then I can do well too. Anyway, I pitched them on that idea right from the start. But Bill laughed and he said, who

are you going to hire? We don't do that, but look, grow it internally and if it, you know, if it needs to be independent from Microsoft, will take a look. Did he give you a budget to build this out? Or yeah, it's a budget and some headcount. And I was able to hire the most entrepreneurial people at Microsoft, which was the place to be if you were intact,

like the only place to be. So I got really great people, established a network of incredible people who were entrepreneurially minded, because I said, come to Expedia, we're gonna build this thing. We're gonna be the largest seller travel in the world. We're building a new travel marketplace, and we're gonna spin out if it's good. Okay, we're gonna spin out of Microsoft. And so I got really incredible

people to Bill and Steve's credit. I was working for Balmer when we when we spun out to their credit. I went to Steve and I asked him for one hundred million dollars to spend on marketing on Expedia. And he laughed, like he have you met Steve. He's a I haven't met him, but I've heard him laugh. He's like he's aggressive and he's big and he makes noise. And he did. He laughed and got kind of red in the face that we're not gonna do that. And I said, well, Steve, but YEA anchored him at a

hundred million. I wanted a hundred million, and I said it, but I need a hundred million on any tv ods. This thing could be huge. We're half the size of the number one guy right now, but we need we need this jet fuel. We got a better prod sucked. We got to do it. He said no, and I said, the public markets will do it. It's pets, pet food, dot com, food com. Everything got funded and I said, look, let's spin it out. Let's take the public. We don't have to sell much of the company. We got a

hundred million dollars and we'll give it a shot. And to Steve's credit and Bill's credit. They said, alright, let's do an hr experiment. Let's let's try to do this thing. And so I took a hundred and fifty people out of the hottest company in the world to work out where they already had stocks, already had stock, the hottest company in the world at the highest point of the stock had ever achieved and would ever achieve even for

the next seventeen years. Okay, uh. And these adventurous people, these courageous people, they came out of Microsoft with me and we took Expedia public and within a year we were twice the size of the number two guy. Wow, that's fantastic. And Expedia still is a free standing company, still publicly, probably traded dollar market cap, doing extremely well, one of the two kind of globally dominant players in the online travel So how do you look at this as your baby which is now off on its own,

and what's your involvement with pride? It's like the kid that went to college and now he's married and he's got a happy family and the family is growing up. I really, you know, it makes me really proud to to to see what Barry Diller and dark Kasra Shah he the current CEO have done since I left. I'm really impressed. Was it difficult to to turn over the keys to the kingdom that easily? Like some there are some entrepreneurs who have a hard time passing the reins?

Did did you have any issues with that? I mean, of course there was some. I had some issues, But my personality is a little bit more. Um. You know, I don't need to own and control and do everything. And I like to think and do about I like to think about a lot of things. I have a diverse set of interests. And when Barry Diller bought it from the Republic for three four years and Barry Dillar bought us out at a really nice price, is interactive? This is? This was I a c H. I see

it was known as USA Interactive at the time. Um, they bought Expedia at a nice price. Um, that seemed like a good time for me to to go think about doing other things. Let's talk a little bit about glass Door. In two thousand and seven, you found the company which helps people find jobs, understand the salary and compensation they're getting, and gives folks a better sense of what what they should be getting for their role. In

the marketplace. Is that a fair assessment? That's right. I actually co founded it with a guy named Bob Holman who worked for me at Expedia. He was a development manager. Most all of my companies that I'm involved with, I've co founded with people who worked for me at Expedia and Zillo as well. So your co founder, I found an Expedia, um, you know, inside of Microsoft. And I co founded Zillo with an Expedia guy and a Microsoft guy,

a guy went to college with. And then I did the same with glass Door, and I've done it with a few others as well anyway, But to glass Door, uh so, yes. The idea with glass Door is not too dissimilar from Expedia and Zillo, and that is to turn on the lights in the room to get people information they didn't have before and specifically, what is it really like to work there? Do people who work there approve of the CEO and leadership? What do people make?

What do they really make? What are their what are their real salaries and job titles in ten years? Um? How do you ensure the integrity of that information? How do you make sure so there's a site rate? My professor, there are other educator related and you know, it's really easy for one I rate student to skew everything. How do you avoid that happening when people are rating either CEO or a business. Door. So this information has turned

out to be really intriguing to people. We get twenty or thirty million people a month now that come to glass Door, and it's become one of the largest job sites in the world. It's really it's really good, and it's gotten there because the information is good. The information is good because we work really hard to ensure that the people who are leaving reviews actually work or worked at the company. And you can validate that we cantronically.

We can do that with email addresses, and we can do that why with and forth communications, So we work really hard to make sure they're legit. Secondly, anything that's too strident to use his profanity or people's names or as personal we just don't. We just don't post. Okay, so we should have a chat with Jack Dorsey at Twitter and maybe you could get them straightened out. You know, it would be interesting. We might you know, we might have a different president if that anyway. Uh So we

we clipped the tails. Basically, anything that that is too stride in one way or another. We clipped clip. That's part of the We did that part of the curve. And I would also contend trip Advisor was something we owned it expedient. We learned a lot from trip Advisor with people leaving anonymous reviews about hotels right uh, And I would say over time that trip Advisor, YELP, glass door reviews on Amazon have actually taught consumers to uh,

to kind of tune out the noise. Anyway, when something looks promotional, they think, oh, that's promotional that person, or when something looks like they have an act to grind, you know, people intuitively say, all right, well that person is a disgruntled ex employee and and that's going on. And so we as humans are tuning up to kind of clip to kind of clip the tails too. So what's turned out is that the the information is really accurate.

We have information on over seven thousand companies around the world. We have tens of millions of pieces of data and reviews. When when you work at a place I don't know Bloomberg, go on to glass door, read the reviews, look at the salaries, see what people think of the ceo. UH and you're gonna read that and you're gonna say, yeah, that's that sounds right to fascinating thing is if you're a obviously someone who's just starting with someone who's very senior,

those are really specific salary pricing. But in the middle of it, a lot of people have no idea what is the standard salary at least in their part of the country. I know they vary from city to city. And it's kind of fascinating clicking around and looking at stuff. And how about and how about gender splits. I mean, we we have all this data, we know the we know the gender of the people with salaries, and we've been able to uncover gender paid disparities. Really, yes, it's

really it's really interesting. But what's the takeaway from that? Then? Uh, the takeaway it's it's difficult really to get a handle on the gender stuff because even if stuff looks equal, you don't really know how quickly a promotional path has had under what promotional opportunities. A lot of nuance there, there's a lot there is a lot of nuance. But generally speaking, uh, women have been paid less than men for the same role. That is a that is a

conclusion that we come to um. Interestingly, investment managers use glass door quite a bit. Oh really, yeah, I have I know several hedge fund guys and investment managers that use glass door to figure out what's going on at the companies they're investing. Are they spreading the wealth around? They must be really doing really well and that may not have showed up yet in the official doctor. What do people think of the CEO? You know, that's quite fast.

Let's talk a little bit about Netflix. So you join the board win when it was private? Come on, I've been on that board for really, I can't remember the year fifteen years at least I remember when they first launched, and the kids listening aren't gonna remember that. They used to mail DVDs through the US postal. And the first time I heard about it's like, why do I want to wait for dv eased to show up in the mail?

And then it's like, oh wait, I don't have to go to Blockbuster and there's always two or three in transit. Oh that makes a lot of sense. And once they moved to all digital, and it was clear that was the goal eventually to go all digital, there was no looking back. What was that process like, okay, well, I had the same reaction unit. So there weren't many web guys back when I went to when I joined the board of Netflix, and I was one of them. I was running Expedia and by the way, how did you

get the invite? Okay, So there were many of us, and and we read Hastings, who has incredible CEO of Netflix, you know, running an incredible leadership team over there. He and I had a mutual friend and investor, a guy named Jay Hog, who is the founding partner of TCV Technology Crossover Ventures. He's a really well regarded historical figure in in technology, isn't it. He is not well known public, low key legend, low key legend. I sit on a few board with him, and I learned. I learned every

time I'm in a room with him. I really think he's outstanding. He knew both of us, both Read and me, and Reid was looking to build out his board, getting ready to go public, and so Read and I had dinner and I said, I gotta admit, like this, this seems like there's an end of the road here. Like the DVD thing, the form factor, it's gonna go with the services. Cool I grant you that, but the form factor is gonna go away. Read You're gonna hit the wall.

And then what's the future. How are we ever going to get any value out of this thing? It's gonna die? Um And he's like, he said, did you see the name of the We didn't name it DVD by mail flicks, Rich named it Netflix. And I'm like, okay, well that's okay, good point, good point. But how are you gonna how are you going to cross the chasm? How are you going to get over the wall? You know that, you know that chasm is there? And he said, I don't know,

He said, I don't know. We we It could be downloads, it could be streaming. Who knows. We really don't know. But here's what I do know that if we can build up a big enough subscriber base before the chasm is upon us, then we'll be in an incredibly good position to cross the chasm with our subscriber base into the new world, whatever that new world. That's some serious long ball. Right before he even launches the I p O for mailing DVDs, he's thinking, eventually, we have to

be digital. He is truly a long long ball player. He is a visionary, long term guy. Um, there are very few people that can do this. You've had a lot on your show. Jeff Bezos is another one who twenty years ago he's thinking yeah, yeah, eventually. Granted we talked about Amazon Cloud service. That probably wasn't in his original plan of hey, we have all these service let's

use him for something. But it was clear that he had an idea about just not competing with retailers, just completely bypassing them, being the right, right entire by the way, I just got Alexa the echo delivered yesterday from from Amazon Prime Day. Um, you know I didn't want to experiment with it a two bucks but at yeah, okay, let me try it. And you could see I just opened the box, you could. I already can see how

if this thing continues to develop the way it does. Um, this is another monster, another and you have to stop and worry. Wonder how did Apple blow this with Siri? I mean they were really way out of It's not over yet. It's not over yet, but but well, Siria has to get a lot that Amazon, right, Siria has to get a lot better. And what subtle and interesting is just how important response time is in using and

using these things and using these voice intelligent agents. Uh. Sirius was okay, but not many people used it when it first came out because it just, you know, it just didn't respond very quickly, and you had to be you had to be near a network that actually worked. And in the United States, that's an iffy proposition on

in mobile. But if you're at home, if you're at home and there's a dedicated device that all it does is listen for you to say its name so that it can respond really, really quickly, all of a sudden people started using it. And you know, when you're busy with your hands in the kitchen and you want to set a timer, are you going to reach for your iPhone to set the timer with four or five clicks? Are you going to say, Alexa, set timer for thirteen minutes and it and it just works. I'm you know,

I know Jeff a little bit. We're both in Seattle, Um. You know, he is really the most impressive business guy of the kind of of the new millennium. I mean just so so so we've mentioned a couple of CEOs we've made and read Hastings and Jeff Bezos what other CEOs impress you and what characteristics do you think define an outstanding CEO in the modern era. Well, because I'm a startup oriented person, I tend to be focused on the founder CEOs. I believe that the found the great

the greatest CEOs tend to be the founder CEOs. I think, Um, there are terrific professional management CEOs that come in later, there's no question, but a professional CEO never quite has the credibility of the founder. Isn't usually isn't able to to think really long term and and and carry the employee base in the investor base along for a the long ride and say, hey, we're going to invest billions of dollars in producing our own streaming content even though

we've never done that before. Come along, I'm gonna hold your hand, and you're gonna hold my hand, and we're gonna get through this because on the other side it's glorious. But in the intervening six or seven years, the P and L and the cash flow is going to be ugly. Okay, Really, founders have license to do that, uh, And afterwards it's it's a little bit harder. Uh. There are lots of bad founder CEO s too, for sure, But I think the the true Grates in my mind, like Bill Gates

and Steve Jobs and Jeff Bezos and Read Hastings. Um, what do you think of Zuckerberg at Facebook? Zuckerberg, He's He's amazing. He's really an incredible andreason said. He is just a human learning machine and just is constantly observed if there's something to be learned in any environment. He's just a sponge knowledge. He's a sponging you know what. Young Bill Bill Gates is still that way really, but young Bill Gates was was exactly the same, no kidding.

It's just cons instantly hard learning about everything, not just the stuff you think that they ought to be learning about based on their businesses, but wanting to know everything. We have been speaking with Rich Barton. He is the co founder of Zillo and glass Door and the founder of Expedia and numerous other entities. Be sure and check out my daily column. It's at Bloomberg View dot com. You can follow me on Twitter at Rid Halts. We love your comments, feedback and suggestions right to us at

m IB podcast at Bloomberg dot net. I'm very Rid Halts. You're listening to masters and business on Bloomberg Radio. If you're having a business dispute, the process can be slow and drawn out, especially if you rely on litigation. In the courts. You can wait for years before your case is resolved, and the longer your case proceeds, the more your case can cost. Not with the American Arbitration Association. Arbitration or mediation with the American Arbitration Association is faster.

In fact, nearly fifty of our cases settled prior to hearings. A d r dot org resolve faster. Welcome to the podcast, Briche. Thank you so much for doing this. I am I've I've said I'm a giant fan of Zillo, and as I started researching who you are and what you've done, I'm like, oh, I know that company. Oh wait, I know that company. Oh wait, I know who those like? Oh I I how did I not know who this

person was many many years ago. All the things that you're involved in are some of my favorite and most regularly used technologies, So that that's pretty interesting. You've had quite a fascinating career in Seattle. Can we say Seattle is rapidly gaining on Silicon Valley? Is that a fair statement. By the way, you're the second person I've had from Silicon Valley from I'm sorry, from Seattle, the first being Nick Hannahur all right, Nick, my friend. Yeah, Seattle is

a boomtown. Boomtown, sixty two cranes, leading city in the US. I just had that graphics three day. Clearly does the cranes everywhere. This is because the flywheel, the tech flywheel is spinning and it's just get the snowball is rolling left and nobody cared. No, well no, I mean there's a lot of boeing still there, Okay, but the headquarters

left and nobody cared. I mean it started with you know, Microsoft, probably Microsoft was this incredible gravitational force for tech talent from around the world, sucking it in and as micros as is, that talent kind of scattered. It started all kinds of New Spain, Expedia. So Amazon especially I think is driving uh the the new is the new magnet for talent coming into town. The new HQ downtown is

supposed to be spectacular. Well, it's multiple buildings. I mean, I would say five or six of those cranes are Amazon, and they've they've revived a whole part of town. Um, it's it's truly, it's truly phenomenal. I guess I would add that the University of Washington is an incredible university, and most especially the computer science department, where I actually gave the commencement this year, which is quite good fun.

We get a lot of computer scientists, engineers out of out of you dub It is a top five program in the country. And so this this mix of you know, education and talent and money and and it being a terrific place to live, means that Seattle is really rising rapidly. Now is it gaining on Silicon Valley. No, that snowball is probably you know, it's even bigger, and that thing is still rolling to I spent I spent about half my business time down in Silicon Valley as well, And

it's just it's about so. We were justin in Silicon Valley earlier this year. My last trip to Seattle, I spoke at you dubbed in the Finance department, which was really kind of fascinating. Um, And I was spoke at the Treasury department of Microsoft who showed me the most amazing thing on the wall behind them. They flip a panel and it spins around and there's a white phone on a shelf. It all it is a white fie. What's the white phone? Oh, that's the bad phone that

Bill used to call. And they literally showed me a guy who's got a keyboard. Who's the guy who handles the Microsoft stock repurchase program for new option issuance to new employees. And they also, long before Apple, they had a massive stock repurchase program. And I jokingly said, what it has a keyboard with like one key just to buy thing on it. It was a joke, and they someone pulled out a keyboard that they had given him. It was. It was pretty hilarious. The Microsoft was another building,

the Treasury department. There, it's thirty people in the running a hundred billion dollars. It's an incredible amount of I think at the time it was eighty nine billion. It's close to a hundred now or if it's not past it. That campus was astonishing for people who have never been there. It's like the size of any four colleges combined. And none of the buildings are in numerical order. It's not like one to three. So you even have this, it's

even bigger than you imagine coast. You can't just extrapolate one five. Wait, what is building one seven? We've just been building eight. The highlight of that trip was visiting the Microsoft Office office. Will you walk into the room and it's into the building and it's Microsoft. The logo Microsoft Office on the wall behind you, and it's like, so, what's in this building? She points to the logo this is the office office, which was hilarious to me. But

they were dead. So what was it like watching that get built out? Because in the early nineties it was small. We were small, I mean small relatively speaking, but as opposed to what is it like? I knew all the buildings, right, and I knew a lot of like not everybody, but most of the people in Seattle by the time you left, By the time I left, I left in I couldn't possibly know everyone. Watching it get built was um, you know, it was miraculous. It really was. And it's a testament

to Bill Gates. I'm a big believer in the Jim Collins be hag carry audacious goal uh and Bill Gates put forth one of the great begs. You know, a computer on every desk and in every home running Microsoft software. So the knock on Ballmer. And I want to ask you if this is fair, is that he wasn't a b hag guy. He didn't have these audacious goals. They were really a series of small goals as opposed to throw in the hail. Mary. Well, you know, a great bee hag needs a great field general and a great

operator to you can't, you can't. You don't just magically get to your b hag because you have it, even though I believe to a certain extent they are self fulfilling, but you need operationally to get there. And I don't know that I've encountered anyone better than Balmer from an operational person as a field general. But what about as a CEO? As a CEO, you know, as that's what I mean. As a CEO, he grew, I mean he grew, He grew the company. The company grew quite nicely under

his uh you under his leadership. Um My guess is that that Bill probably stepped back a little too much, uh in providing that visionary overlay kind of pointing to the mountain in the distance when Steve took over. And um, and that's it is. And and so it's hard to know how to step back, okay, and so you know there were there were some issues, but overall, I mean Microsoft's a company in very good shape. Yeah, no doubt

about it. There are no courses at Harvard Business School that's say, by the way, when you build what was then the biggest company in the world, here's how to ease back a little bit. I don't think that's a that's in the manual. You know, so even though it should be so you you you referenced um what it was like, meaning read Hastings and working with um. Netflix. Amazon theoretically is the big competitor to Netflix. Is are they perceived that way or are they Yeah, they're really

a real retailer, and video isn't what they do. You know, the Amazons are doing quite well, uh with their prime video and they appear to be really serious about it. They're getting good content, they're getting good viewers. Uh. My personal opinion, uh is roomful, lots of players in the space. Well, it's it's even better than that from my perspective. And I would say this is probably reads perspective as well.

And that is O T T over the top. So Internet TV, the more Internet TV there is, the more Internet TV there is Okay, So this is a pie that just keeps getting bigger as more and better content is available on the Internet and on your on your smartphone. And what's really happening is that time is being taken from other things you were doing, whether whether you were watching traditional linear TV or whether you were doing something else. Uh, and that time is moving at a really rapid pace

to internet television viewing. Um. Netflix is great. You know. One of reads great geniuses is focus and clarity and long term and not getting distracted. The company has never done an acquisition, is that true? Never done an acquisition. That's amazing. I had no idea, and I'm the kind of guy that always has new ideas. I'm like, what about sports? What about music? What about video games? And reads like yeah, well we're gonna keep our eye on the ball. Rich, thank you, we thought about that and

we're going to keep all right on the ball. Their original content is great. Yeh. Master of None is fabulous. This run of stand up specials that they've been paying people boatloads of money to do. The Chappelle one is justice, It's genius. That was just unbelievable. Um, things you see stranger things, no that's a good one. You should see it. If I have any complaints about Netflix, and I really

don't have a lot. That they fixed their connectivity issues, they fixed their bandwidth problems, that there's a ton of stuff that they worked out. The original contents is great. I find the old organization on the website so much better than the current organization. As an app on a TV, it's not easy to find something when you're looking for it, or God forbid, you say, I don't know what I want to watch tonight, but let's chill with Let's Netflix

and chill. But really watch Netflix, not Netflix until, by the way, tell him whatever genius in the PR department came up with that phrase spectacular. I think it was an emergent, that it was emerging. But I do think it was emerging the company grabbed onto it. I would love to find out that that was some evil marketing genius sort of fed that out. That would just bemo Kelly Bennett. Hey, Kelly, where did that really come from?

If they're smart, they'll never admit it. Oh no, that was purely But but if you just say, let's love for something, it's a different it's a different form factor.

You're totally. You're a different distance from the screen when you're on your couch, you have a different control mechanism, and so tons and tons of i Q and sweat has gone into trying to anticipate what you might like to watch next and putting that in front of you rather than being a hunt for you know, a search and find paradigm on a big screen at twelve feet

does not work very well. And so what what the designers are trying to in the in the coders are trying to do is use really really smart software to anticipate what you might want and put it there and uh, you know, it's it's it's actually quite we do quite well. It may not feel it to an old uh you know, search and find type paradigm person who's used to it on their laptop. It's it's different when you have a keyboard.

You find stuff more easily, No, for sure. And I would make the same complaint about Amazon's interface for it. And by the way, it's not just me as a fifty five year old, I've heard similar discussions amongst um

younger niece's nephews, millennial co workers. There is a holy grail of how can you combine both so that we're making suggestions of things that based on your your previous viewing history, we can figure out you want, but also make it easy for what in the mood for Let's find a way to do that, and that should be a voice based intelligent interaction in the future, and it eventually will you know, the advantage you mentioned, um how Echo is an emergent technology, the advantage with Alexa, Hey

find me something good to watch on on Amazon Prime. That's a monstrous thing. It's not there yet, but at one day in the future. Um. Somebody just said, if you extrapolate what Amazon is doing twenty years into the future, their a monopoly at that point and someone's gonna have to break them up, which coming from Microsoft, that has to be an interesting Yeah. I lived through that d J thing. It was really rough. It's not you know,

no fun, it's no fun, um, you know. And I think it is inevitable as companies get really really huge, and I think Jeff is probably well aware of that and is trying to do everything he can to um, you know, to delay that as long as possible and to play within the rules. But eventually the tall poppy gets chopped down you have to say to say the list,

you know, my fantasy or my imagination. I should say, in the ninety nineties, when there were a number of small tech companies that I was kicking the tires on and a number of new ideas going around, I pictured every venture meeting having the founders come in giving their pitch, explaining the technology, explaining the market, explaining they have to what they need to do to capture critical mass, and then someone saying, what prevents my acrosoft from building this

into Windows? And if you didn't have the right answer to that, thanks for coming by. I mean it was pretty much that until really combination of d J slowed Microsoft down a few years, and then the web exploded and that question went away. It's like, well, no, they can build it into Windows, but we're gonna be on the web. We're gonna be on any platform. There's a

new question now, though. Let's hear it Amazon, right, what's going to prevent Amazon from Amazon cast a shadow every all directions now and a long one in all directions, which doesn't seem physically possible. But so the metaphor breaks down. But that is the question being asked by venture capitalist

they're doing devices, They're they're obviously dominating retail. And I read recently that something like of all searches take place within Amazon, well maybe overall, but even even higher percentage of uh commercial searches, which are the valuable ones that results deeper center. More of commercial searches happen, Uh happened to Amazon? Um? You know Amazon is Uh, Yeah, they're They're They're everywhere. Who else is in Seattle? That that's of note? Who else should we be aware of as

a up and coming company? Because I know there are a few companies out there. Concur is there. Um, I don't know if that's up and coming, but that's it's been around a while. Um. Back to the Amazon thing for a second. It may not be obvious, but they're they're really the major force in enterprise software as well now because of a WS and because pretty much most computing is moving into the cloud, into a remote cloud. UM. The whole software enterprise software stack, which is not my forte.

I do consumer internet marketplaces, um, but the whole enterprise software stack is moving out of these premise based systems as sold by Oracle and other you know, more like IBM one, but they're also moving to the cloud as well. Okay, well, here's the thing. Amazon is the cloud, and Amazon keeps adding more and more functionality. Embet it as a service within the cloud, and it's taking over chunk by chunk, is taking over these enterprise software categories. You know, Oracle

as a pretty big database business. Amazon has a really big database business that's a little bit lower end, but is eating eating the big database. Really has no idea and it can. It's going to be the same for you know, HR software for sales software. I mean, it's a legitimate competitor to salesforce type I think, you know, I don't know that one specifically. I haven't sat in on a pitch on that, but it certainly wouldn't surprise me.

And and I bring it up because that's part of the shadow that overhangs any kind of venture pitch, right see. I see it from the other end of the market spectrum, which is it used to be if you wanted to set up a company, well you had to hire a CTO, and you had to get a bunch of service and you get a bunch of web designs. You had to do all this startup stuff, which twenty years ago cost million dollars and today again to quote and Rees and it's you know, the total cost is the founders laptops

and their access to Amazon. Absolutely, and it's pretty similar to what we were talking about with your with Ridholts Wealth Management right where schwab or more fidelity, Uh is a WS for you you can have a turnkey exactly. That Times article was great. It is it really, that is what a WS is and that is what a a w S is going to grow into. Stuff like that. It's pretty it's pretty interesting. So other companies in Seattle.

There's a really hot data one called Tableau. It's interesting. Um, you know, there's a history that F five was there. There's a histor long history of um, you know, biomedical stuff coming out of Seattle. M jen Lee Hood is there. So it's a really rich kind of biotech and medical community and that is a going to be a big growth area. UM. It's becoming known as cloud City though you know cloud City because of AWS and because of the Microsoft Azure which is Microsoft Cloud is also there

is also there. Uh, there are all of these new cloud based enterprise software companies and cloud based tech companies that are growing up in Seattle. I would say that's probably the most exciting area of tech growth in Seattle. Not an area that I personally participate in. I like to build brands, but it's interesting. So you have people who are working in Amazon with people working in Microsoft. They get the startup bitch, sometimes with the blessing of

the company, sometimes without. They go out and do what they want to do. And that was the other question is what vcs are up there or do all the big vcs have a branch up there? Now? Both basically we have some. We have some native Seattle venture capitalists are that are that are good. It's not as broader, as deep or as experienced a venture community, but companies like Madrona and Ignition and Mavarn these are in Seattle.

Uh is Ingnitial, Ignition a combinator or is that a straight up These straight up VC A lot of cloud stuff. They do X X largely X Microsoft guys UM and they've they've done pretty well. I would say when I raise money for my startups, when I have done that, I generally I look to Seattle vcs, but because of my connections in Silicon Valley, I tend to take my A rounds from Silicon Valley. I find that especially in consumer internet, software space and media, the Valley is a

much deeper, richer, more experienced ecosystem. Uh so I can learn a lot more from from from the Valley. So so, what are the next startups we're going to see coming out of rich Bond? You know, I'm not actively looking for him. I'm pretty busy. I have eight or nine boards. Um, I really enjoy being a coach and I have some terrific players that I'm coaching and I really take pride in in in watching them succeed and hit hit singles,

doubles and an occasional home run. Um, I enjoy that scratch that itch or does it if you if you ignore it long enough, does it does it start up again? Um? It's there, It's certainly there. But I'm moving into a phase of my life where there are a lot of other things I like to do, and so I'm not actively looking for new startups that said they come along. Um. You know, I recently joined the board of Artsy here in New York City, which is why I'm why I'm

here Arts Arts. Yeah, it's going to be the the digital marketplace for fine art secondary market for fine arts. I just wrote a column somewhere. Was it Bloomberg or somewhere else? Probably there was. Just just the other day, we just raised a fifty million dollar d round I invested as an angel investor years ago. It's a marketplace build. I love marketplace builds. It's a power to the people play. You know, the art market worldwide is we estimate three trillion.

There's three trillion of art stock, fine art stock on walls and in warehouses and in museums all over the world. But that's a really fat head, long tail distribution. You have a thousand grand Master's painting, and that's a trillion or a couple of trillions, probably not quite a trillion. There aren't as many. It doesn't go quite as deep as you think it does. There aren't. There aren't as many. There aren't that many hundred million dollar plus value value

works out there. But but you lots of your point is taken, yes, but the bulk of the transactions in the art mark in the fine art markets have been between five thousand and fifty thousand dollars of the three trillion. Just grant that to me for a secure forty four billion dollars of art trade a year. Really decent chunk of money. Okay, it's a big chunk of money, but it's a percent a percent and a half of the

art stock. I know of no other business where that asset based business where that lower percentage of the of the stock trades value changes hands every year. Housing, for instance, about fifteen six of the housing stock turns over every year. Automo that global or just in the US. In the US. But and let's call that two hundred trillion in total assets something. I think it's a hundred in land and

a hundred in improvement on those lines. Automobiles. I don't know the exact numbers, but my guess is of the automobile stock trades every year or is purchased in the primary market. Leasing is so big three years, its okay. So if it's three years, it's even more, it's okay. Uh so uh At one, I see real opportunity to create a marketplace where that's that stagnant pool can start moving. We can bring we can bring some motion to the water. And there's been no real marketplace for these things to

to trade hands. It just hasn't really existed. There's been no way to do it. So I kind of view it as our artsy as Airbnb for art, Airbnb for art, or really more Etsy for art. Well Carter, the CEO, likes to say Uber for art. Um I would say more air, but I guess the analogy for Airbnbs for me is that there's all this fallow, dark inventory over the world, and I'm gonna light it up. We're gonna light that up, and we're gonna bring it into the light.

The museums are the are the Marriott's and Hilton's and all the individual homes that are availed from rents is everybody below the grand masters that may or may not want to sell a painting and I'm gonna collect. My wife is a collector. We have a lot of contemporary pieces in that price range, and we never sell pieces even though we'd like to, because there's really no way

to do it. How do you do it? There? They are A horrible article is about, I mean really good articles about how horrible it is if you purchase something from UM an art dealer. They pretty much control that artist, control that market if you want to sell it. If you don't go through them, they're very really upset at you, and it's like, Okay, that's it. No more x y Z artist for you. Wait, I bought this, You're now out of the process. But apparently not is a little

mini monopoly in that space. So you guys are gonna break that. Well, we're gonna bring We're gonna bring empowerment and light and liquidity to to a market that's been a little stagnant. And here's the thing, here's the good news for art dealers and artists, uh, is that when you bring liquidity and you get motion, and you get movement, it grows. That billion out of the three trillion is going to go to that one percent of the market

that's trading is going to go to two. Then it's going to go to five, then it's going to go to fift end. And so what happens to the overall market, it's a multiple. It's an into your multiple of the size it is today. And so everybody's actually going to win, especially artists, collectors, anybody, the dealers, every everybody's gonna win. Everybody's gonna win. An arts he is going to be the marketplace that that enables that. So I see it

as a really big opportunity. The mission The kind of mission of the company from the founder Carter is to make art as ubiquitous as music. Mhm. That's fascinating, although music is less ubiquitous than it used to be. M you think, um no, but you know it's hard because I'm old school and I still buy CDs and then I immediately get the Amazon download, so I have both. I don't stand why I'm gonna pay ten dollars for

digital without the CDC for the stereo. I want the actual Try asking your new Alexa to play Jack Johnson, to say, hey, Alex, Alexa played Jack Johnson or whatever it is. And what happens? You try it? Okay, I literally just just it? Does it? Okay? Barry? It does it instantly? It does it instantly. Did you get the one with the good the big one? Okay, you got the big one? Good? By the way, that was the better.

The forty nine dollars reduced to thirty nine didn't make sense to me, but one seventy nine to eighty nine that made more sense. So the speaker is not great, even in the big one. It's not awesome. Okay, my son knows that I have in my house. I was gonna say way better, way better. Do they work? But here's what here's what happened. Now, here's what happened. Here's what happens in my kitchen in Seattle in the morning with my three kids. Okay, we have the fancy son Nos.

We got the app for sons to control Sanos. It's literally next to Zillo. Okay, I'm not exaggerating. I'm literally right. I'm exactly the same way. Let me get that picture. I gotta get a picture of that. That's so funny. That is literally with Starbucks, fit Bit and Uber on the home page. I'm gonna get you in the photo too, all right, got it? Okay, here's the thing what my kids do and my wife, which drives me batty. It's a little too hard to open the Sonos up really

select whatever music services. What they do. They say, Alexa play the new Drake and that's it. And it does. And they don't care that the quality is crappy. It's sitting in the corner of the kitchen. They don't care. The quality good listening to drink it's good And I'm like, what are you doing? Why are you doing? That just works with Sonos now yet, well, not that I've seen I've been watching for and I was I thought it was on the list of skills. And if you could say,

Alexa play x y Z and son. Nos, now you're really talking about I've been I've been like on Twitter asking that question for quite some time with the people in charge, and it ain't. It ain't million yet. You know, I think that's an eventuality. It should be. It should be. So I only have you for another ten fifteen minutes. Let me get to some of my um favorite questions. Let's start with what's the most important thing that people don't know about your background? I was the ice cream

Man when I was a kid. I drove the ice cream truck, the good you a truck, the white truck was it was it was the blue blue skybar, Blue sky bar anyway, it was increaching in New Canyon, New Canty, Connecticut. It was. It was not a Was that a summer job? Summer job? I drove it one summer. A great way to meet young girls. I'm sure, um, what else I know? That's no, that's a winner, driving the ice cream Man, right, Nobody everybody likes the ice cream Man. Next time you buy,

Alexa asked him to play the Van Halen song. Ice cream Man, ice cream Man? Um early mentors. Who were some of your early mentors? Um, my early mentors. Uh, I've always been interested in stocks. Actually. Um My dad was one of these guys that subscribe to Value Line. He was he was a corporate executive, but his dad had been a Wall Street had been a bond salesman actually,

and some my dad subscribed to Value Line. And I remember pouring over Value Line with my dad as I was learning how to do stocks and learning about pe ratios. I remember buying abbed Labs when I was a kid, as well as Sony the Walkman had just come out, and I'm like, Sony's gonna kill it. That was a bad one. Last was a good one. I see when the iPod came out, I had that same phot about Apple. Oh, this is the Sony Walkman for the digital era. And when I cut my teeth on Value Line and I

remember thinking, why isn't this updated instantly? Why am I getting pages? And then was already there They scratched that itch. Yeah, that's amazing. Um My dad, my dad was. Yeah, my dad was was like a great one for me. Um, you know, I'm really lucky to have had exposure to some some of the greats, really Steve Bomber. But you know, Bill taught me a lot. And Steve has taught me a lot about about about passion and storytelling. Uh. Bill

has taught me a lot of a long term vision. Um. I'm really lucky I have had the pleasure of working with a couple of the best venture capitalists I think of all time, who I kind of view as my mentors. Obviously, Well Jhog we talked about TCV, you know. Uh, he's around our age, you know, maybe closer to your age than my age, maybe a little older. Um. He's a calm, experienced, level headed, well informed. Um. He's the guy that can ask the really hard question in the really non threatening way.

I've learned learned that from him, and and that is a good skill. Bill Gurley at Benchmark Capital. Bill is you know, perhaps the most successful, well known venture cat, well well published. You know, Bill, he we were supposed to do a show and he unfortunately had a family emergency and were rescheduled for September or so. Should really he's excited. He's going to be great on here, and and he is quite an intellectual finance guy. I mean, he really is. But what and what I've learned from him?

He was an analyst before he was a venture capitalist. Um, and what I've learned from him, I guess he's really He's taught me how to think uh competitive strategy, you know, in the Michael Porter sense. He's really an unbelievable strategic thinker. And he has helped me figure out how to break down product situations, businesses, industries and look at it through a competitive advantage from a competitive advantage perspective, and where

are the moats? Where's the value created? Um? And ultimately how it all ultimately comes down to a DCF you UM had had these mentors, who was the person that, as a business person, most influenced the way you build and manage companies? All of those guys have helped me. I'd say Greg Mafas helped me quite a bit too with financial engineering, and Barry Diller he's quite quite a financial engineer. By the way, You've given me a list of a year's worth of future podcasts. You know theyre

in there. They'd all be great. Um. You know, I think my business ethos is probably an amalgamation of a lot of these folks. My most my my my most recent job had been Microsoft, and so that's the culture I knew. And when we started an expedia and spun it out, I knew what I wanted to bring from the Microsoft culture and what I wanted to leave behind, what I wanted a little short elbow. Back in the day it was there. There was a it was very aggressive,

challenging environment. Uh. That wasn't for everybody, and turn a lot of turn some people off. Uh. And the engineer was God eight and everybody else was a supplicant. Not a bad approach if you're building technology, it can absolutely work. But my opinion is that that building companies for the long term requires all the spokes on the wheel to be tightened to the same to the same pressure, more of a team effort, in other words, so that the

wheel rolls true. Otherwise the wheel kind of bumps along and you have problems, and companies that are too lopsided culturally they all end up with problems. Uh. And so so you know, kind of having a no assholes policy and a respect you know, a respectful culture that's challenging and competitive, but not to the exclusion of you know, being respectful I share your philosophy, and and it's always difficult to tactfully explain to somebody why they're not a

good fit for that reason. But it's really important, it's really important. All Right, this may be my single favorite question, or at least reader's favorite questions. Tell us about some of your favorite books. Okay, uh, yeah, I love this part of your your interview is people. I get emails all the time. I'm always looking for a new book to read. Yeah, don't forget to ask that question. Yeah, so I told you I'm not a big business book reader. I live business. When I'm in bed at night reading,

I'm not. I don't. I don't want to read about my life. I want to escape. I tend to want to escape. Um, I read a lot. I mainly read fiction. Really, that's fascinating. And I would say that my passion category of fiction is probably science fiction both not surprisingly. What have you read recently that you really like? Well, I really, I really love Neil Stevenson. Who's the Seattle guy. He wrote snow Crash. You know that was that's William Gibson.

William Gibson. That's right, I love snow Crash. Was was Neil Stevenson's kind of breakthrough work from fifteen or twenty years ago where he envisioned the internet. He envisioned um. He called it the metaverse. Uh, snow Crash is a real winner. In fact, Mark Andreeson and Your show refrosched it too, but snow Crash again but he neil. Recently we published a book called seven Eves. Somebody else referenced. Maybe it's Chris Anderson somebody else reference Okay, Uh, seven

Eaves is just off the hook. Now. It's dense, uh, and it's a little technical, but it's approachable by anybody. Um. But the conceits the setup for seven Eaves is a agent, and unseen agent of some kind hits our moon and breaks it into seven pieces just kind of like you know, crumbles, just doesn't crumble, just kind of breaks apart. And they all kind of are moving together, and they're still orbiting the Earth. And everybody's worried at first, and they're like, oh, well,

you know, gravitational centers about the same. It's orbiting the Earth. It's all good. Um, nothing bad is going to happen, right. Well, then the pieces start to bump into each other, okay, and little pieces break off, and the more collisions cause more collisions, and of course we know what happens that the bits of the Moon start falling into the Earth, and it becomes apparent to the smart people on Earth

that the Earth is gonna end. And so they knew exactly how long it was going to take because they did the statistical models. And now it's a race to get as much stuff up into as much of humanity up into space before the Earth dies. And that's the kind of set up for this wonderful, this, this wonderful

to add to the list. Sure, he also wrote Cryptanomicon, That's the one I was thinking, which completely is prescient around the whole cryptocurrency thing that's going on right now and is a is a very dense work that I'm that my fifteen year old son is working his way through right now. He's kind of a geeky kid. Um. But it it tells a terrific kind of Alan touring age story, a World War two story, and stashing Nazi stolen gold in Japanese islands and ties that somehow into

what's happening with cryptocurrency today. That's interesting. Um, I know, we only have a few minutes left. I got to do the I have to do the last three questions. Oh, so let me do the last two questions then. Um, what sort of advice would you give to a millennial or someone just beginning their career? Interesting question, absolutely, someone interested in technology and or digital Take big swings. Take that goes back to take swings, the big Harry carry audiations,

Dream big, Dream big. It's just as easy to swing for the fences that as it is the bunt right. You're at bat, Take big swings, especially young people. You you you're at a point in your lives that, whether or not you know it, you're at your most risk. Loving. Don't have kids, you don't have family, hopeful a ton of dad. Hopefully you don't have a ton of a ton of dad. Um, you know, take big swings. Hang around the hoop as well. Find the hoop, find where you think the next big thing is, and go hang

around that hoop. The way to score points is to hang around the hoop. That's the best way. And our final question, what is it that you know about out venture capital technology startups today that you wish you knew back in? Um? I think that, uh, you know, I kind of I think about it as an investing question. Actually is okay, And you know, the mistakes I made, the mistakes I've made investing are all the follow of the ticker mistakes. Okay, they're all the d D mistakes

where we feel like we need to do something. I'm watching the ticker, and I wish i'd known back then. I kind of logically knew that you just got to pick a few stocks and hold them forever. And I knew that I'd read you know, I'd read about Buffett for sure, like that Carol Loomis book on tap Dancy to Work is a great book. So I logically knew all this stuff. I watched my dad. But the truth is,

human nature doesn't let us really do those things. But but I wish I had really known that the Amazon stock that I had pre I p o that I should have just helped. Okay, um, But that long term calm orientation is the same thing I wish i'd i'd really known about starting businesses too. I mean, that is the most important things, to have that long term vision and stick to it. It's that big dream that attracts the best people to you, and you know, stay on target.

We have been speaking with Rich Barton. He is the founder of Expedia, co founder of Zillo, glass Door, and numerous other startups. If you have enjoyed this conversation, be sure and look up an inch or down an inch at any of the other hundred and fifty or so such conversations we've had over the past three years. You can find us on Apple, iTunes, SoundCloud, Overcast, and we're adding a few other technologies, so by the time you hear this, you might be listening to it on on

something else. We love your comments, feedback and suggestions right to us at m IB podcast at Bloomberg dot net. I would be remiss if I did not thank the wonderful team that helps put these podcasts together. Taylor Riggs is my producer in the recording studio today is Charlie Valmer. Medina Parwana is our audio engineer. Mike Batnick is my head of research. I'm Barry Ridults Human listening to Masters in Business on Bloomberg Radio. Masters in Business is brought

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