The American Optimist – Joe Lonsdale talks with Archbridge President and CEO Gonzalo Schwarz

Joe Lonsdale
Joe Lonsdale is a technology entrepreneur, founder of Palantir, Epirus, Resilience, and other technology companies, and an investor. He is currently the managing partner at the venture capital firm 8VC, the Chairman of the Board of the Cicero Institute, and the host of the American Optimist Podcast. More recently, Joe became a founding trustee of the new University of Austin. Follow Joe on Twitter @JTLonsdale.

Joe Lonsdale is a technology entrepreneur, Co-founder of Palantir, Epirus, Resilience, and other technology companies, and an investor. He is currently the managing partner at the Austin-based venture capital firm 8VC, the founder and Chairman of the Cicero Institute, and the host of the American Optimist Podcast. More recently, Joe became a founding trustee of the new University of Austin.

The following is a lightly edited conversation between Archbridge President and CEO Gonzalo Schwarz and Joe Lonsdale. 

Gonzalo Schwarz: You have a magnificent piece on the future of work from a few years back in Wired magazine. Why do you think fears about the future of work and the risk of mass technological unemployment are overblown? And what are a few industries that you think will flourish in the years to come?

Joe Lonsdale: Sure, well, this is obviously a really complicated question that I’ve written a lot on. I think a big part of this is the intuition, which we build for ourselves, about how labor works and what labor actually is. And if you see labor in the right way, which is really—when you have a job, and you’re working, you are serving others—you’re finding some way to add value to the people who are paying for your time, to groups or companies who are paying for your time. And the actual truth is that there are really an infinite number of ways to serve and help others. There are just so many ways to do that.

And so, even as technology advances and makes it so there are more efficient ways to do certain things that we are doing right now, it also creates new ways to help others, as well as new ways you can augment people who use it. And so I think the intuition people have—it’s wrong—but it’s very easy to see how we are going to have the ability to do certain things a lot more efficiently in the future than they are being done now and people doing those things now are not going to be needed in the same capacity. For example, you eventually won’t need truck drivers, but what I think people don’t see is how technology will allow new jobs to exist.

Ironically, speaking of truck drivers, we actually need a lot more truck drivers right now because there are so many more ways technology allows us to deliver things to people.  We need massively more jobs throughout the logistics supply chain because of that and because of the growth of e-commerce. And there are some more interesting areas to think about as well. There are all sorts of ways in which you’re going to get much better at understanding mental health, and people’s minds, and how their minds are performing or not performing, or where they’re having trouble in their lives because of some of the things going on in their brains. And technology is going to allow us to understand all of that better. It’s going to allow new types of jobs to exist.

Or we could have coaches that are much more high level. Coaches who are really helping people self-actualize at higher levels. There are just so many new jobs that are going to exist. 

And I think to build an intuition for this, people should probably reflect back in time—50, 100, or 150 years. It’s very interesting reading about how in the late 19th century, during the second Industrial Revolution, there were just all these jobs going away. There were all sorts of these jobs that were being replaced by manufacturing, and all sorts of new things were made possible thanks to the fact that you now had railroads, the fact that you could have canned food.

There were just all sorts of things happening and changing the economy then and people would have looked at you and said you were lying if you told them that there would be jobs like social media manager” or something, that were going to pop up. They would have thought you were a crazy person. Its just something people have a very bad intuition about. It’s very easy to see things going away. And, I actually have more empathy for people 150 years ago, because back then, all wed ever worked on were farms pretty much. The vast majority of people worked on farms or had small town jobs. And so, seeing a lot of small farm jobs go away, seeing a lot of small town jobs go away, you know what, a smart person who was worried about that—I give them credit.  That’s fair.

I think today, a smart person shouldn’t be as worried. A smart person should be able to see how much weve transformed, to see how much everything transforms. So I think today, Id have a little less sympathy than I would for people back then, because you should actually realize that there have always been new ways to help others, always new ways to serve others.

And unless A.I. replaces people entirely, which it is not doing right now and which it doesnt seem likely to do (and which, by the way, if it were doing, should then be thought of as a much bigger problem, asking people to really give some thought to a whole bigger set of issues), we’re not going to run out of jobs.  Believing we will is just the wrong attitude.

GS: Yes, and those people should be worried about creating more opportunity.

JL: Exactly. Exactly. It’s about, how do you find ways to serve? How do you find ways to create? How do you find useful things to do? And the world is not perfect, and therefore there are so many useful things to do to make the world a better place.  There are ways of doing that economically. And once you have that attitude, you realize, wow, there are infinite possible jobs.

GS: I want to move on to another question. I haven’t seen it on your website recently, but if I remember right, you have this motto, I think in both your private sector work and your nonprofit work, that centers around this phrase that you use, private solutions to public problems.” Can you expand on what you mean by that? Or give some examples of the problems and solutions?

JL: Yeah, sure. I’m not sure I put it exactly that way, but I think that there are multiple ways of solving problems and fixing things.  I tend to embrace a kind of entrepreneurialism and innovation as the best way to solve problems.

And so if you would want to consider those to be private companies, in that sense, that’s your private solution. There are so many areas in which you could start a private company to fix something broken with government, fix something broken in our society, and serve people. And one of the things I’m working on right now actually—with new entrepreneurs, residents, and people I’m mapping this out with—is how do we use technology to reinvigorate civic bonds and to help with vocational education and help make sure people aren’t left behind?  How do we make sure people in the communities, you know kind of like guilds in the old days, are able to help everyone else succeed in their community and make sure they do well. Thats the positive side of the guilds in the old days. There were negative sides in the old days, too.

But, we really have had technology that, in a lot of ways, has isolated people and polarized people. There are a lot of negative consequences to the natural evolution of social media. And the question I’m asking right now is, is there a way to make sure there is a positive output from the technology that influences and solves these problems? And so that’s one area we’re working on right now. 

Other areas we’ve worked on in the past, obviously, as you saw the government wasting billions of dollars in not catching the bad guys and not protecting civil liberties.  Things like that inspired us to start Palantir and to have a better solution in the intelligence world.  We then obviously took that way of doing things to a lot of other sectors.  OpenGov is a company we founded. It helps 3,000 governments do their budgeting processes better, be more transparent, and be more efficient in all sorts of ways. We started that company after doing nonprofit work and realizing we needed to get innovators and get a business into there to fix some of the backwards ways some of these local governments were working and help them out.

And so those are all types of examples. And then, not every not every problem can be solved by for-profit. I think there’s definitely a role for philanthropy and for nonprofit organizations as well. And, you know, there’s a role for fixing policy. So I have a nonprofit organization that fixes the policy to create more transparency, more accountability, more incentives, which is Cicero, obviously. So we try to have both approaches to fixing these things.

GS: You recently helped to launch the University of Austin. What was the main motivation that led you to do so? And what do you expect to accomplish in, say, the next five to ten years with the project?

JL: Yeah. Well, this is a very big and very hard thing to do. But you know, as entrepreneurs, we look for gaps in society; and there is just a really, really big gap that has developed between how our top universities work and how they could be working, including the types of values and principles they hold, their training, and the types of speech and debate they allow. And it’s very unfortunate that a vast number of people feel censored and unable to openly explore ideas. That has really leaked out into our society. It has trained people to be leaders who don’t speak up, who aren’t bold about their opinions, who don’t confront broken things, don’t confront untruths because they’re worried they’ll be shouted down, theyre worried it will be bad for their careers to speak up against broken things. And so it allows our society to get a lot more broken. It allows lots of things to get more and more ridiculous. This is not a left versus right issue overall. It’s just an issue of training people to be cowards, and training people not to have intellectual courage, training people not to be allowed to consider certain things because it’s off limits” to consider those things. 

And that’s just very unhealthy for our society. It’s basically fundamentally against the classically liberal values of our society that created America as an exceptional nation and that led to progress by being openly willing to consider all angles and trying things and pushing things ahead. So I think we have a very anti-progress, very authoritarian, very scary set-up. And really what you have is administrators who conquered these schools. They’ve done it on purpose. It’s like this conspiracy over the last 40 years; you see these administrations that have tripled in size, quadrupled in size. There are more administrators at Yale than there are students. And these administrators—for the most part—are very neo-Marxist, very authoritarian, very, very against people who express views that do not go along with the far left.

And it’s very scary. You see them training ineffective leaders. You’re seeing them suppressing speech, suppressing thought. They’re demonizing people as heretics. They’re making people afraid to speak out, they’re allowing students to come in and protest and have their way about truly crazy things. In many cases they’re afraid to tell students how they’re wrong.

So, there’s just a lack of courage in these places.  I think we can actually have a school that trains leaders who can think, who can stand up for themselves, who can push for solutions, and who consider both sides of an issue. It’s very important. I have a lot of friends on the right who say, “Oh, Joe, you should only have people on the right.” And I say, No, you guys are wrong. We actually have to have people who are on the left and you have to have people who are smart on both sides. Otherwise, you’re not going to be learning as well. You’re not going to understand issues. To understand an issue you have to have smart people from both sides, thats the whole point. It’s not that you want to have a school that’s just with people on the right, that wouldnt be functional. It’s only functional if you have the smartest people from both sides engaging and getting better because of each other and then finding ways where they can agree on answers that take the best from both sides. And that’s what makes our country great and we need places where these conversations can still happen and they’re not happening at the top universities.”

And so it’s a very big deal if you can create one where that can happen. Over the next five or ten years—or hopefully over the next three or four years—I guess I’d say our aim is to get an undergraduate program launched and have it doing well, start breaking ground and building a really beautiful university here in Austin.  Hopefully, when we’ve graduated classes, we’ll have a lot of alumni who are important leaders in the innovation and policy ecosystems and who are making a difference—and who are making it so that the top people want to come to our school.  If we do a good enough job, the University of Austin will actually become a huge challenge to the existing established, more decadent universities. And they learn that they have to change their ways if they’re going to compete because they don’t want to lose all the best new leaders to something outside of themselves. And so that’s really the goal.

GS: Moving onto the next question, besides the new university project and the for-profit work you do, you also founded a think tank called the Cicero Institute. And I was wondering, why did you choose the name, and how has Cicero influenced your thinking or your approach to life? Also, you discussed the community work youve been working on with Cicero but what are other projects you have been working on?

JL: Yeah, sure. Well, you know, Cicero is paying homage to the Roman statesman and, there are a lot of  pieces I’ve written about this online and a lot of different reasons why, but the main reason really was a lot of his writing. He actually summarized a lot of the ancient wisdom from our classical civilization. And that, as you know, kicked off the Renaissance.  It really led to a huge amount of discovery and the application of that wisdom in the right ways prompted tremendous progress in Western civilization.

A lot of the positive principles of Western civilization led to the success of Western Europe, led to the success of America. Cicero really believed in the power of ideas. He believed in the power of commerce, he came from the equites—the landholder commercial class, he was devoted to public service. He pointed out that it is not for ourselves alone that we are born or live. He dedicated his life to defending freedom and the Republican government. He very famously attacked special interests all the time, and very aggressively.

Cicero was politically pragmatic, which we want to be. We’re not Cato. Cato was very admirable, but he was not a pragmatist at all. He didn’t get things done. He just yelled at everyone all the time, which I think was very impressive—to be a pure example of your pure views, but I actually like to get things down the road and actually build real things, have real results. Cicero famously embodied integrity and he obviously, at the very end of his life, was murdered as the republic was lost. And so it is what it is. He died for his cause and after doing a lot of great things throughout his life. But really, what he represents to me is—because his writing was rediscovered and helped kick off the renaissance—what he represents and what we’re paying homage to, are the values and principles behind Western civilization, as well as to a great statesman.

We started Cicero because there are so many places with obvious, good answers that are nonpartisan that can lift up hundreds of thousands or sometimes millions of lives by putting good policy in place. And our theory of change is to work at the state level. The states in America are laboratories of democracy. Those are places you can actually get a lot done. It is very hard to get things done in D.C. I have certain friends who are really good at navigating D.C. and who are a lot wealthier than I am, and they’re able to figure out different moves. It’s like, there’s differences between junior and senior billionaires, and I’m a junior one I guess you’d say. I’m 39 years old, I’m still learning, but I am able to get—with inspiring good ideas, ideas that make sense—attention from state legislatures. You can get attention from governors. You can get things passed. Many, many of Cicero’s policy initiatives get passed with both Democrats and Republicans. It’s very common to have both sides passing these ideas. And these ideas channel the values of free society. They channel how to get transparency and accountability to overcome broken systems. They take sclerotic, broken bureaucratic systems, and they put in place systems that allow people within those things to become leaders and to change how they work and to actually take a broken thing to a good result. And obviously I can give you a lot of examples if you want, but that’s the idea.

And you try to think about what would the greatest Roman statesmen be doing in our age if they were confronted with this ridiculously broken government that is causing so many problems in so many areas? And what would the approach be to have a more inspiring set of results for everyone? That’s how we’re trying to approach it.

GS: Let me ask the next two questions together. One question is, do you have any specific companies in your venture capital portfolio that you can discuss that you think will accomplish great things in the near future?

And that’s related to another question, which is, what has you feeling most excited in terms of progress and innovation and why? And I imagine those answers go together because as you’re working on those fields, you’re also investing in those fields. So, I think they can go hand in hand.

JL: Yeah, so Gonzalo, the way we approach things in the innovation world and the entrepreneurship world—the venture capital world—is we look for areas where there’s something that’s newly possible and that’s very important. And then we look to back the very top talent in those areas. Then we bring in other top talent and then approach these new possibilities in the right way to achieve great things.

I think the most important one is still the renaissance in biology that’s going on.  Im very excited about cell therapy, gene therapy. Last year at the beginning of the pandemic, my partners and I, along with Bob Nelson—whos a great leader in the bio world with his firm ARCH Venture Partners, co-founded Resilience Bio, which is the leading advanced bio-manufacturer now.  We raised very large amounts of money, bought small plants, hired thousands of people, and scaled the plants. Most of these plants we purposely start in the US in order for the US to have an advanced manufacturing base because we needed it to produce mRNA and cell therapy and gene therapy because we didnt trust other countries enough to not have it here.  Then we raised billions more and are building even more plants, are partnering with allied countries doing stuff in Canada, the UK, the UAE, et cetera. And that’s going extremely well.

We partner with a lot of people to help them. So basically—you think about AWS, which is Amazon’s cloud servers, and where it used to be in the old days. If you were going to start an enterprise software company, you’d have to have a bunch of people building a server right there at your company and maintaining the servers and spending a lot of money on the hardware and the expertise and stuff. And instead of doing that, you just pay Amazon and they do all the backend for you, for servers, and that makes it much cheaper and faster to start an enterprise company.

Similarly, in biology, Resilience can be like a back end to a lot of companies so that rather than those companies having to raise $100, $200 million and build their own advanced bio-manufacturing for a really good idea, they can partner with us. Then, maybe it only costs them $10 million instead of $150 million to get going on phase one.  That really accelerates the field.  There’s just a whole set of things happening now, where you can even program cells to go after cancers, go after inflammatory disease, help with almost any disease.  The cell is a very cool, complex machine and were learning how to target them and use them. There are tons of lives already being saved, but there are going to be a lot more. 

Another is aviation and transportation. Do you know Joby Aviation? They went public recently.  We were investors in the first big institutional round about six years ago. I think they are the top electric vertical takeoff and landing company. It’s called eVTOL, and it’s a really exciting field and company.  I think we can have people commuting all around in these very safe, all-electric flying cars; effectively, theyre winged vehicles that take off and land vertically. Very efficient for passengers. And we think they can be cost competitive with Uber, which would be crazy, you know? At least with Uber black. So that’s very exciting. I’m also very excited about Elon’s tunnels to change transportation. 

The world of defense has a lot of new possibilities, too. You know, its very important to me that America outcompetes China. So that’s not just an area of possibility to spur innovation, but a necessity as well. 

And there’s the world of healthcare services. I’ll give you one more of those. Healthcare services is such an exciting area right now because there’s all these things you can do with value-based care. One example is City Block Health. So basically, if you look at state Medicaid, about five or six percent of people on these Medicaid programs take up 40-something percent of the cost. And that’s because they tend to be people who are homeless or have chronic disease. Maybe they are very out of shape, maybe they have mental health problems, just like, the people with the worst problems. And it’s very sad, right? But they take up a lot of cost. And so the question is, what do you do?

And this company goes and invests money proactively in those people. So it does a deal where it says, Listen, health payer, you’re going to be paying for this set of people who are really high cost, around $30,000 on average next year. And we’re going to invest in them and help and them do all sorts of things, depending on who they are, to improve their diet or help them get certain services. Or if it’s a winter night where they’re going to freeze and they’re going to be in the E.R., maybe we just got a backup motel and help them through their issue. And it turns out that by spending money to do that, you can actually bring down the health costs so much, that you save the whole system massive amounts of money.

So this company, City Block is valued now at $6 billion and it’s helping something like 100,000 people or an order of that, and growing very quickly.  It’s helping people who desperately need help in our society. It’s so cool to have a for-profit model that actually goes in and invests more in people who are most in need and then saves the system money overall.  And you’re only able to do that because of these kinds of new value-based care models.

There are so many areas of health care where value-based care lets you use common sense and lets the best approaches to help people the most win, competing with hospitals, etc. So there are a lot of things were doing there too. Sorry if thats too much…

GS: No, no that’s great. It makes me very happy to know about all these advances and maybe even more optimistic about the future. Which leads me to my next question. Your podcast is called American Optimist, its featured some great guests and has illustrated at least some of the reasons why you’re optimistic about the future. I just wanted to just directly ask you what makes you an American optimist, why are you bullish on America, and why should others feel the same?

JL: Well, there are a lot of challenges that we’re all aware of right now, and there are a lot of things that polarize us and make us angry. But history has always been very tough for humanity. There havent been times when there was not suffering and there haven’t been times when the world has not been tough. But, I guess I’d say things are getting much better every year in terms of our ability to solve problems and in terms of our understanding of the world and any of the problems we face right now; there are good solutions to them. There are really clear solutions to them. And I’m optimistic because America and the founding values of America are very clearly the right answers. 

We have a country that has the right exceptional values and that have outperformed. Of course, there are people who want to take the bad parts and the mistakes and they want to throw everything out because of that. But I think enough people in America realize the founding values do have some really great wisdom in them, that the idea of a free society and the idea of a classical liberal society where all ideas are allowed to be spoken and debated and the best ideas are allowed to win–it’s very clear thats the right answer. Its clear to me that if enough of us are fighting for them, that they’re going to win.

And then, every one of these things happening, people are going to be able to live longer because we’re going to cure a bunch of these diseases or understand aging, understand biology better than we ever have before this renaissance.  We’re going to be able to deliver cheaper, better goods, we’re going to be able to solve many of these environmental issues and problems because there are just great answers we’re seeing for everything. And I think as long as we take the right attitude, and we actually work on the answers and work on understanding each other, we have a very bright future.

GS: Excellent, I share the same perspective. To continue along those lines, what do you think are the main challenges that we face today? Is it that we’re just not optimistic enough? That we’re not positive?

JL: Well, I think we’re probably not solutions-focused enough. I think there are too many people who are too… Well, for example, people who want to say, I’m offended.” Well, that’s stupid. Every time you get offended, stop and say, OK, that means it’s my internal problem and I’m not going to go attack someone for being offended because that doesnt help.”

You’re not helping when you’re offended; you’re actually hurting when you’re offended. When you’re looking to demonize others, when you’re looking to tell them you’re offended, when you’re looking to try to play a victim card—doing those things is not helpful. Those things are actually causing your problems. Whenever you have a framework thats a zero-sum framework, whenever you’re saying, either I win or you win, either this group wins or that group wins, whenever you’re trying to demonize a group, if you’re trying to demonize immigrants, if you’re trying to demonize successful people, whoever you’re trying to demonize, that’s not helpful. That’s not how our society progresses.

And so I think the problem is getting people to think in a positive-sum framework. Getting people to think, how do we build this? How do we make this more efficient? How do we solve this problem in the best way and make sure the best ideas win? How do we run our prisons better? How do we run parole and probation better for society? How do we run our education system better and let ideas compete?

Every time you’re demonizing or you’re focusing on special interests as opposed to a solution— that’s the problem. And I think if we can get enough people to focus on solutions, and demand solutions that harness our values of freedom, then it will be pretty easy to solve our problems.

GS: I certainly agree. And so, with that in mind, what do you hope America will look like in, say, 30 or 50 years from now?

JL: I think America could be an extraordinarily wealthy society where the least well-off are doing extremely well. If we can solve some of these problems and get growth going back at two or three percent again, which I think is very possible, then in 50 years, in a couple of generations, you’re going to have people who are even the poorest people who are going to live much better than the middle class today, much better in the upper class today, which has been true in the past as well.

I think we can make it really cheap and easy to commute and to access our cities, with tunnels, which means I think we can make it really cheap to build on the outlying places of our cities so you can have everyone very affordably living middle class lifestyles.

I think through ingenuity youre going to have cooler, more fun games, better food, better health care. I think education is due for a renaissance. Weve got to do it. We actually have to win in some of these states to prove it—show how education improves when there’s choice and competition and innovative ideas are allowed to spread within some of those states, and the other ones will then eventually be forced to copy them. And so there are just all these places where we can solve these problems, and there is just so much upside there.

I think we can hopefully have a society thats figured out, I mean—I don’t think well ever figure out how to get beyond some of our tribal nature because we’re humans—but I don’t think that tribalism has to be the main feature of our society. I think hopefully, culturally, and with how we modify our technology, we could be able to get past that and instead have a solutions-oriented society where people are really thriving.

GS: Were down to the last question. You have had already, I think, a stellar career, but I think in many ways, your lifes work has just started. So, I know it may be too early to think fully about this question, but I’m sure you’ve given it some thought already.

What do you want the Joe Lonsdale legacy to be? What are you working towards for that legacy?

JL: Well, Gonzalo, I like the idea, which I know people around Reagan used a lot, which is there’s no limit to what you can get done if you dont mind who gets the credit. 

So obviously Im very proud to have founded several billion or multi-billion dollar companies. And we’re passing hundreds of pieces of legislation, hopefully in the next few years. We’ve already gotten a lot done that is hopefully lifting up the lives of a lot of good people.

I think if we do things correctly with the institutions we’re building and with the work we’re doing, we can re-inspire the values of our free society and we can really make sure that Western civilization is growing and progressing and thriving.

And that’s the duty of the leaders in our society. Its to make sure our society is thriving in that way and to make sure that millions or tens of millions of people can self-actualize and live better than they would have lived thanks to how our system is working.

There’s been a lot of darkness the last hundred years in other parts of the world. When you have had socialist and communist systems that have really ruined billions of lives and it’s really taken people who could have self-actualized—could have been great artists, great intellectuals, great thinkers, who could have achieved wonderful things with a lot of happiness—and a lot of that was snuffed out and lost and destroyed thanks to communism and thanks to these really bad authoritarian ideas. And I think if we all fight and make our society more functional, we can keep it free and we can let people continue to prosper.

And that should be the goal of any leader in our society.

GS: Excellent. Thank you very much for your time, Joe.

Joe Lonsdale
Joe Lonsdale is a technology entrepreneur, founder of Palantir, Epirus, Resilience, and other technology companies, and an investor. He is currently the managing partner at the venture capital firm 8VC, the Chairman of the Board of the Cicero Institute, and the host of the American Optimist Podcast. More recently, Joe became a founding trustee of the new University of Austin. Follow Joe on Twitter @JTLonsdale.