Investing in People, Talent Vortexes, Writing, & Tradition vs Progress

Summary

Episode #037 of Spencer Kier’s Audience of One, ~65 minutes. The most reflective of Kyle’s appearances — it starts on venture mechanics and ends on what he’s most afraid of regretting — and the one where several ideas that later became essays are visibly still forming.

FOMO cycles, and a careful distinction. Asked what’s occupying him, Kyle names “the ever-increasing pace of FOMO cycles.” His example is micromobility around 2017–18, where investors were branding their careers as micromobility investors. The distinction he insists on: he is not skeptical of the technology — micromobility is genuinely useful, and so are cryptography, Web3 and the creator economy. “I’m skeptical of the mismatch between the companies that get built and the way that we build them and the intense fervor.” He adds that skepticism is a bad trait in venture generally: “you need to be optimistic to believe that any of this stuff can work out when statistically everything’s against you.”

Three filters against getting caught in a cycle. First, Fred Wilson’s line that investing behind hype cycles is the worst way to make money — so “a good company at a bad price is a bad investment,” and Contrary consequently makes fewer AI investments than most (Nomic being one they do have). Second, the what do you have to believe exercise, with a twist most people skip: not just what you have to believe, but the statistical likelihood of that belief being true. “If you have to believe a thing that has a very low statistical likelihood of being true, it should become harder for you to believe. And for a lot of people, that isn’t the case.” Third, companies that can exist independent of the capital lifecycle — which leads straight into the idea he says he hasn’t written yet (see below).

Why Contrary is built differently — two beliefs, tested by actions. Kyle’s move is to say everyone claims these and then ask them to point at what their firm actually does. (1) Every company is simply a collection of people — so Contrary built product SKUs that exist entirely independent of any company: the Venture Partner Program, and three content lines (Contrary Research, Foundations & Frontiers, and How We Work, which interviews commercial airline pilots and tunnel engineers precisely because technologists otherwise only build for people like themselves). (2) Every venture firm should have to justify its own existence — “what job should a founder hire your money to do? And if your answer is anything, then you’re probably not a very good venture firm.” Via Clayton Christensen (jobs to be done and an innovator’s dilemma specific to venture): the barriers that once made VC necessary — racking servers, distribution, on-prem — have collapsed, so relationships are what’s left as a moat.

Why there aren’t more capable founders. Prompted with Emmett Shear’s claim that the bottleneck is world-class founders rather than money, Kyle first refuses the category — “founder” is as unhelpfully broad as a political label. Then two constraints. One is an unhealthy societal construct for risk: students overwhelmingly optimize for security and optionality, which he explicitly declines to disparage, but the exceptional founders tend to have “burning the boats and chips on shoulders” — part of why so many come from immigrant backgrounds, who “have a very different relationship with risk.” Two is his sharpest formulation here: “the loudest lessons are often the worst lessons.” For something to be broadly disseminated it has to be generalized and watered down “to the point of invalidity,” so people learn what’s most broadcastable rather than what’s true — chasing markets that look like good markets, against Peter Thiel on competition and Paul Graham on solving a problem you have actually lived.

Talent vortexes. The number one characteristic, “and this is true of both people and companies, is just intense, relentless curiosity.” The mechanism is compounding: curiosity begets curiosity, pulling you vortex to vortex, and that exposure to genuinely different worlds is what equips people to innovate. His illustration is a close friend who rolls up funeral homes, collects first-edition books and sails — “I feel like I learn almost more about venture and company building from him than I do from the other person who looks and talks exactly like me.” He also has a lovely complaint about young people who ask their four prepared career questions and stop, when he’s offering to tell them which companies he thinks are bad and who he’s heard terrible things about.

Can you manufacture one? “I don’t like the word manufacture. I think maybe spark them.” Two ingredients: ambition — and a genuinely sympathetic account of why ambition has come to feel dirty (societal injustice, work-life balance, mental health), from The Renaissance of Rise and Grind, landing on “culture is created from having an impact regardless of salvation” — and hacker vibes, where he cites Venkatesh Rao on AI being unusual in that most people talking about the wave are spectators rather than participants, and notes the real action is “not in VC conference rooms, it’s in random Discord servers.”

How you keep the bar high: triangulation. “When you have two data points, you might think that you understand the slope of a person’s career. It is all about collecting multiple data points.” The analogy he reaches for is marriage — the best pre-marriage advice he got was to see the person sick, early in the morning, late at night, on a road trip, lifting heavy things. Contrary’s products are, in that light, deliberately touch points. Paired with a willingness to admit you were wrong in both directions — about someone you wrote off, and someone you rated highly.

Profit versus good, argued properly. Via Stephen Covey’s circle of influence and control: scale increases your capacity to do good. But he fences it on both sides. Against the means-justify-the-ends fallacy, he takes apart “do whatever you want, just don’t hurt anybody” — “who does that leave you to hurt? Just you. And that’s very dangerous.” And against deferral, the best line in the episode: *“philanthropy is a muscle that is learned and developed. It is not a switch that you flip on or off. And if you spend a lifetime gathering assets, you will not have the muscle to be able to distribute those assets very effectively.” He tests it on Warren Buffett — candy, sugar drinks, Apple — and then gives Buffett the credit he thinks is actually deserved, which is aligning incentives through Berkshire rather than maximizing fees.

Religion and technology as “a matter of altitude.” No contradiction, because scope changes everything: today’s scientific reality shown to someone operating in a thousand-year-old paradigm would be “fall to your knees, worship the magic levels of insanity.” And we are not done — dark matter and dark energy are most of the universe and “we don’t have a clue what they are.” From there to the two commandments, and then the part that connects it to his day job: there is a spark of creativity in every human being, and if God is a creator, then building things and solving problems is a way of growing closer to that. That is why he is excited to invest in technology.

On the name: “you’re calling into question maybe the worst branding decision that I’ve ever made, because everybody I talk to hates that name” — Investing 101 2.0. “I usually refer to it just as Investing 101, because I’m still probably figuring out the basics.”

What’s permanently true, and what’s about to change. Permanent: capital allocation. “A dollar is a dollar is a dollar,” and you are responsible for the impact of yours — which is also his critique of impact investing, where he found it “really hard to not have a negative social impact,” and thinks many impact funds have net-negative ones. He prefers Chris Sacca’s framing at Lowercarbon: make the greediest possible person money, because if you can get that person to buy in, you can get anyone to. Changing: the modularity of people and resources. MrBeast is the example — including why Feastables exists, since brands can’t afford his placements — and the projection is startling for 2023: “there could be companies that are valued at a billion dollars, generate hundreds of millions of dollars of revenue and have maybe one person working with them, especially with AI agents… how do we invest in people as opposed to entities?”

“Do you consider yourself a writer who invests or an investor who writes?” Neither. “I consider myself an allocator.” Of capital at work, of time and attention to his kids, of words to an audience — and “even spiritually, I have a finite amount of discipleship that I can allocate to God… I’m way more of a disciple to my phone than I am to God sometimes.”

On systems, and the test that matters. He is emphatically not a productivity maximalist — he tried minute-by-minute time logging in Roam and it never survived contact with his personal life. His actual test: “have I created memories and artifacts that I review later that forced me to change my behavior?” Journals, photos, family video journals, and above all his constant re-reading of his own notes. He’s candid that reading dropped from ~40 books a year pre-COVID to 11 or 12, “four or five of those Brandon Sanderson audiobooks,” and that writing is what replaced the intake engine.

Why writing specifically. Beyond the Flannery O’Connor line, the one that does the work here is “writing is a lagging indicator of observation.” His analogy: you carry your body everywhere every day, and then one odd reach into a car seat finds a muscle you’ve never felt — observation is like that, and without stretching your mind in an unfamiliar direction you never learn what you’d already noticed. Same reason “there’s a little bit of truth in every joke” — stated here in October 2023, six months before it anchors The Glass-Half War — Empty or Full. He also admits his genuinely favourite mode isn’t writing at all: it’s ranting with friends — “who knows how many awesome things we’ve lost by not recording our conversations.” Which is why he does podcasts.

Seinfeld’s calendar. The mechanism behind the weekly goal, and the missing half of a story told across several other appearances. Systems fail him, so he set exactly one goal — publish every week, never miss — taken from Jerry Seinfeld’s advice to comedians: put a calendar on the wall, cross out every day you write jokes, and build as long a chain of unbroken X’s as you can. At recording this was his 89th consecutive week, and he’s honest about the bad ones: on a camping trip about to lose service, posting from his phone, telling readers to search grass in his archive because he’s going to go touch some.

The natural selection of time. He calls his accumulated core lessons “my music” — experiences encapsulated in a phrase. This one came from two paired college experiences. He was offered an internship at Mitt Romney’s family office, had to decline twice for his wife’s final class and then a competing job, each time asking to stay in touch — and on the third offer took it, crediting it with charting his path into venture. The counterpart: recruiting for Kickstart Seed Fund’s student-run Campus Founders Fund, dozens of people replied sorry, busy semester with no follow-up, and one replied “I’m super busy, but I would love to do this — is there any way we could figure out a way?” She is now a full-time investor there. The rule: “if you don’t have to kill something, then why kill it?”

And the regret he’s actually minimizing. Asked about Bezos’s regret-minimization frame, he doesn’t reach for anything professional: “hands down, without a doubt,” the fear is reaching the later years of his life without a real relationship with his wife, or with kids who are “deeply uninterested” — “I am their dad by genetics alone.” “I can make billions of dollars, and if I don’t have those relationships with the people that I love the most, none of that’s going to matter.” His closing question for listeners follows from it: go back one, five, ten years knowing what you know — what would you change? Then ask what today’s version of that is, because you can’t change the past but you can act on the present.

Transcript

Transcribed locally with Whisper (scripts/transcribe-audio.py, mlx large-v3) from the published episode audio — the show’s feed carries no publisher transcript. Kyle’s answers are verbatim and cleaned; Spencer Kier’s questions are given in condensed form as the prompts that set up each answer rather than word-for-word, since the episode is his own work and lives at spencerkier.substack.com. Section headings and timestamps are the show’s own chapter marks from the RSS feed. ASR errors and names corrected (Spencer Kier, Nomic, Roam, Venkatesh Rao, Lowercarbon, Feastables, Brandon Sanderson, Flannery O’Connor). Nothing reordered or summarized within an answer.

Cold open

Kyle Harrison: This is a good one. This is a deep cut.

The number one characteristic — and this is true of both people and companies — is just intense, relentless curiosity.

People’s trajectory is all about triangulation, collecting multiple data points.

It’s so funny to me that we get to this point where we’re at technologically and we say: religion and all this, it’s so stupid, we know all this stuff now.

Have I created memories and artifacts that I review later that forced me to change my behavior and change who I am or what I’m doing?

(00:46) The acceleration of FOMO and hype cycles

Spencer Kier: What’s one question or problem that’s been consuming a lot of your attention recently?

Kyle Harrison: There’s a lot of people in tech and in venture spending a lot of time thinking about AI — both the positives and negatives, the impact it can have on people’s jobs, and the awesome implications for what can be built.

I am fascinated by the ever-increasing pace of FOMO cycles. I still remember — 2017, maybe 2017–2018 — micromobility was a huge thing and scooter companies were raising a ton of money. And there were investors branding themselves, saying my career will be built on being a micromobility investor. And it’s like, that’s crazy. None of those companies have proven to be very good companies.

How can we as humans — investors and entrepreneurs in particular — why are we so drawn to something, to the tune of billions of dollars of capital invested and a life’s worth of work for a certain number of years, to these things that do not produce the results that we want?

And at the same time, I think micromobility as a concept and a construct can be valuable. There are still people who get value out of having scooters on streets. But the mismatch between the companies and the way they get built and the opportunity that exists — the same thing kind of happened in crypto and Web3, creator economy, and now AI.

The fear I have with that is I never want to be seen as a skeptic, because skeptics in venture are not great to have. You need to be optimistic to believe that any of this stuff can work out when statistically everything’s against you. So I’m not trying to be skeptical of technology. I think AI is powerful. I also think cryptography and Web3 and blockchain can be very powerful, and the creator economy is real — there are people building their livelihood off being creators.

I’m not skeptical of those things. I’m skeptical of the mismatch between the companies that get built, the way that we build them, and the intense fervor. I spend a lot of time thinking about that. I don’t have a good answer for it, but it takes up a fair bit of my thinking and writing.

Spencer Kier: How does that inform your investment philosophy? Venture is a game of asymmetric returns — you don’t want to miss the boat, but you don’t want to get caught in a wave of what will eventually be defunct companies.

Kyle Harrison: There are three things that come to mind.

The first is something I think Fred Wilson said recently at a Primary Ventures event in New York, where he said investing behind hype cycles is probably the worst way to make money. So we actively try to avoid hype cycles. We do have investments in AI companies and tooling for AI — we have an investment in a company called Nomic that helps fine-tune large language models. But we’re actively avoiding the things that feel hyped. Because even if it’s a good company — a good company at a bad price is a bad investment. Which means we probably make fewer AI investments than a lot of people are making right now.

The second is I spend a lot of time on what do you have to believe? If I invest in a company at seed stage for it to be a massive company — what do you have to believe? There are all these operational and strategic things that have to go right. But there’s also: what does this company eventually look like? Is it acquired? Is it a public company? If it’s public, how does it trade?

I think we often lose sight of that, because it’s what do you have to believe — but what is also the statistical likelihood of what you believe coming true? If you have to believe a thing that has a very low statistical likelihood of being true, it should become harder for you to believe. And for a lot of people, that isn’t the case.

And the third thing is I look for companies that have some capacity to exist independent of the capital lifecycle.

One of the things I don’t know that I’ve ever articulated — and I have not yet articulated this in writing, and I would like to — is this idea of a value chain of capital. Seed investors don’t just make investments in what they think are good companies; they make investments in what they think Series A investors will think are good companies. And Series A investors invest in what they think Series B investors will think are good companies. You have to have an understanding of what the next person will want to buy, or that company will struggle to raise. And if their model is dependent on future capital, then they will suffer.

I don’t know that anybody has fully appreciated how impactful that is. It’s the same as in public markets — you’re not trying to guess what will happen in the market, you’re trying to guess what other people think will happen in the market, because that’s what determines markets.

So that’s another area where I think about: are there companies that, yes, may need more capital, but that will not be forever dependent on massive amounts of capital and massive outcomes?

(07:04) Being people-centric is contrarian in VC

Spencer Kier: What are the key ways Contrary thinks differently — the core competencies other funds don’t have?

Kyle Harrison: There are two big things. Some may feel obvious, but every time somebody says yeah, I believe that, I ask them to prove it — point to other firms and show how their actions demonstrate that belief. Actions speak louder than words, and you’ll find a lot of firms do not operate with these beliefs.

The first is the idea that every company is simply a collection of people. Everybody says of course, we invest in founders first — but everybody’s entire product and business model is built around a company and a transaction. There’s this company, we invest in this round, and that is 95-plus percent of our interaction with them.

Contrary has built multiple product SKUs that exist completely independent of a company. The first is our Venture Partner Program, where we identify the sharpest people in undergrad, grad school, PhD programs, and as they begin their journey into startups we want to be right there with them — sometimes years before they start a company.

Our content is the same way. We have three major content lines. One is Contrary Research, where we try to tell the story of private tech companies. One is Foundations & Frontiers, where we go very deep into specific areas of technology — nuclear energy, AI, whatever. And the third is How We Work, an interview series to dive deep into areas that — most often technologists build technology for themselves, because that’s what they’re exposed to as engineers. We want to expose people to very different industries. So we’ve interviewed commercial airline pilots and tunnel engineers.

None of those content pieces are targeted at specific companies. It’s not here’s how to run your company, which is what a lot of VCs do — because again, that’s very company-centric. For us it’s very people-centric.

The second thing, which I write a lot about, is that every venture capital firm should have to justify its own existence. We’ve had too long of venture firms being able to exist just because. Every venture firm needs to be able to answer: what job should a founder hire your money to do? And if your answer is anything, then you’re probably not a very good venture firm. You’re trying to be everything to everyone, which makes you good at nothing.

So we think about being a product-led venture fund — not in the sense that we have an AI chatbot that says yes or no, should you invest. Product-led in the sense that our content represents product SKUs, our programs represent product SKUs. If you’re not in the target market we’ve delineated with our products, that’s totally fine — we’re maybe not as good a fit for you, and that’s okay.

(11:19) Barriers have been lowered; relationships are the moat

Spencer Kier: How do you retain that advantage as more funds try to copy it?

Kyle Harrison: I end up quoting Clayton Christensen a lot — he’s kind of in the BYU alumni mafia, so I’m a big fan. I’ve already quoted jobs to be done: what job do you hire a VC’s capital to do?

The innovator’s dilemma that exists in venture is that your job is to identify good investments and make them — this company-centric model I’m crapping on a little bit. That is the golden goose of venture capital.

That worked for a long time, because the startup ecosystem and the process of company creation was still very nascent, and the barriers to entry were significant and difficult to overcome — racking your own servers, coming up with complicated distribution mechanisms, on-prem software. All of that was really difficult, and as a company you needed VCs for it.

The best thing that’s happened to technology and startups in the last ten years is that basically all of those barriers have been dramatically lowered. Cloud computing made everything easier. Mobile made everything easier. AI is going to make it even easier. Social media and content and PLG made distribution so much easier.

So when people ask what firms do I want to work with, whose capital do I want to take? — it is by and large going to come down to who do I have the best relationship with.

And as a venture firm there’s an innovator’s dilemma, because they’re stuck with their golden goose: our engine is identifying and investing in companies. Our end outcome is still the same — we’re also trying to identify and invest in great companies — but we recognize things are changing, and that we have to reinvent our focus so we’re building those relationships well in advance.

For a long time that looks kind of stupid, because we’re spending a lot of time with fairly young people who are nowhere close to starting a company. I joke that at previous firms we’d play the hurry up and wait game: I can invite you to a dinner once a month, but until you start a company there’s not much I can do for you. For us, there are as many things we can do for you before you start a company as after — and increasingly we’ll do things for you after you’ve exited one. We want to be relevant throughout someone’s life, not just for their company.

(14:44) Why don’t we have more world-class founders?

Spencer Kier: Emmett Shear said the biggest constraint in startups isn’t money, it’s world-class capable founders. Why don’t we have more of them?

Kyle Harrison: The first thing that’s true is that “founder” is a dangerous catch-all title — in the same way that saying this is a Republican, this is a Democrat is too broad-sweeping to be helpful. A founder is a ton of very different things. It’s not a 19-year-old dropout, but it’s also not a 45-year-old former exec with an MBA. They can be all of those things. So the founder journey can come from a lot of different directions.

But in terms of people who have the capability to build a successful business — I agree there’s a limitation on those types of people. A couple of things limit that supply chain.

Number one is a very unhealthy societal construct for risk. You look at investment banking, consulting — jobs that are very secure. You talk to a lot of college students, and the number one thing they want has very little to do with fulfillment or creativity and a lot to do with security and optionality. Which is not necessarily bad — there are a lot of people who, from a financial perspective, should build that career stability. So I don’t want to crap on people who go do banking or consulting.

But I think there’s an element of burning the boats and chips on shoulders that most exceptional founders have. Not to say no founder has ever done banking or consulting — plenty have. It comes down to the mentality more than the specific path. It’s finding people who feel there’s a chip on their shoulder, and to respond to it they have to burn the boats and pursue this thing fairly dogmatically. That’s one of the reasons you see so many exceptional founders from immigrant backgrounds — they have a very different relationship with risk than most people who’ve had a fairly secure upbringing.

The second thing, from a training perspective: the loudest lessons are often the worst lessons. For something to be broadly disseminated, it has to be very generalized and watered down — to the point of invalidity. So people learn the lessons that are most easily broadcast, and I think those are the wrong lessons.

What that means is people look for what they feel like a good startup should be. They look for an idea, they look for a market that should be a good market. It goes back to the Peter Thiel-ism that competition is stupid — because if there’s competition, then by definition you’ve not necessarily uncovered something unique, and you’re going after a tried-and-true thing, which creates race-to-the-bottom issues.

The lesson I’d hope people take more of — something Paul Graham writes about quite a bit — is the pursuit of something that feels meaningful and concrete to you, a problem you know exists and want to solve. Which is why some of the best founders are people who have lived the experience and are solving it for themselves, and it just happens to address the same problem for a lot of other people.

(19:49) Talent vortexes and curiosity

Spencer Kier: What are the consistent characteristics of individuals who form talent vortexes around them?

Kyle Harrison: The number one characteristic — and this is true of both people and companies — is just intense, relentless curiosity.

I’ve had a ton of conversations with younger people over the years, and I try to be very transparent. I’ll say: I’m an open book, I’ll tell you anything. If you want the inside baseball on this, or why this is stupid — I’ll tell you which companies I think suck and which people I’ve heard terrible things about, anything that can help you in your career. Ask me any question. And they’ll say, awesome, thank you so much for your time, I think that’s all the questions I had. And I’m like — no man, come on. Anything. What’s the spicy stuff? What are you trying to unpack? And they’ve got the four or five career-development questions they wrote down, and they don’t know what else to do.

The most intense vortexes that bring interesting and talented people toward them — it’s curiosity begets curiosity. When you meet somebody and you’re curious and they’re curious, the things they’re curious about pull you in. That’s vortex to vortex to vortex. And that multiple-reality dissemination of seeing lots of different things is often what creates the most interesting people, but also the people best equipped to innovate, because you’ve been exposed to very different things.

One of my best friends — we don’t have a ton in common. He buys funeral homes and rolls up funeral homes. He collects first-edition famous books, he has a boat, he talks a lot about sailing. I feel like I learn almost more about venture and company building from him than I do from the other person who looks and talks exactly like me, because he’s thinking about the world in a very different way.

Spencer Kier: Can we manufacture more talent vortexes? What are the ingredients?

Kyle Harrison: I don’t like the word manufacture. I think maybe spark them. These are more naturally occurring phenomena — they’re not made in bottles, there’s no MBA case study that tells you how to create a talent vortex. But there are ingredients you can combine to spark that environment.

The number one thing is ambition. And there are a lot of negative implications people feel around ambition — that comes from societal injustices, which are totally fair. People feel burdened by the weight of a system that doesn’t work for them, so ambition feels like a dirty word. And work-life balance, and mental health — there are all these things that have made ambition feel kind of dirty.

I wrote a piece a couple of months ago called The Renaissance of Rise and Grind. There’s a lot of negative grind mentality — work for work’s sake. But there’s a level of healthy ambition, and Paul Graham wrote a piece about great work with a similar idea: accomplishing something you feel very proud of, that has impact on the world in a way you feel is meaningful and positive.

It doesn’t always have to be saving the world. Impacting the world is okay. Culture is created from having an impact regardless of salvation. It’s not always that you’re saving the world from the problems it’s created — it’s that you’re having a positive impact that changes the direction of the way people think. And that ambition attracts healthy groups of people who come together to pursue similar ambition. So the more ambition you have, the more opportunities there are for talent vortexes.

Number two is the early hacker vibes that made Silicon Valley what it is. People don’t hack on stuff as often as they used to. And the thing I actually like about AI — Venkatesh Rao wrote this, I think — is that for the first time there’s this wave where most of the people talking about it are outside spectators rather than participants. I really like that about AI. There were elements of crypto I liked about this too — a lot of people doing deep research, firms like Paradigm and Andreessen launching research arms to get into the weeds.

In AI there are a lot of people just hacking on stuff, trying to figure things out. In broader application software and consumer, there’s much less of that. Lowercarbon released a fund announcement yesterday — it was almost like a joke, like they’d accidentally launched the early copy to their WordPress and couldn’t take it down, saying the quiet part out loud. Very web-1.0 humour. There’s not that much of that vibe in consumer and software. AI is an area where the hot stuff is happening not in VC conference rooms — it’s happening in random Discord servers.

(26:55) Triangulation, and admitting you were wrong

Spencer Kier: How do you maintain a high bar for talent as the network grows?

Kyle Harrison: The first thing you have to know is that people’s trajectory is all about triangulation. When you have two data points, you might think you understand the slope of a person’s career. It is all about collecting multiple data points.

I think this is true not only in identifying talent, but in marriage. The best advice I got before I got married was: try to see the person you think you want to marry when they’re sick, early in the morning, super late at night, on a road trip, lifting heavy things — everything. As much as you can, to understand them in different contexts.

That’s true of talent as well. You should create lots of different touch points. That’s what we do at Contrary — all of our products represent different touch points. We hope they create positive affinity, but they also let us learn. Every event somebody goes to, every piece of content they engage with, every referral they make to us — interesting, let’s look at the quality of the person they referred, and what does that say about them.

So the first thing is triangulation: gather as many data points as you can before you pass judgment. And have relevant bars — if you’re applying a PhD-level bar to undergrads, you’ll never take an undergrad.

The second thing is a willingness to admit that you were wrong, and that can go both ways. Someone we wrote off early — they worked on this project, it was really crappy, negative data point, let’s not worry about them. Or you look at somebody who did some really great stuff, and then they do something and you’re not sure about it. It’s constantly being willing to admit that your perspective on someone can change and evolve over time — and understanding why you think highly of someone or don’t.

(29:35) Profitable versus good for humanity

Spencer Kier: As a father of three and a member of the LDS church — is doing what’s profitable for the fund sometimes at odds with what’s good for humanity?

Kyle Harrison: Somebody texted me recently — a really good guy, super interested in climate tech — saying I don’t want to put money into the stock market, I don’t want to make money just doing this or that. I want to dedicate all of my time, talent, money and energy to fighting what I see as the most important crisis. And I didn’t have a very good answer for him.

The way I’d articulate it from my perspective is that there’s an element of circle of influence and circle of control — a Stephen Covey-ism. By increasing your profitability, your size, your influence, you also increase the size of your control. The bigger you are, the more impact you can have.

I have really good friends who are totally dedicated to making the world a better place — almost monastic, like monks, in how limited they are in what they do. And that’s great. Within their very small circle of influence they’re seen super positively, but they have a very small circle of control and very little impact on the broader world.

But there are two barriers, limiting functions on either side.

On the one hand there’s a means-justify-the-ends fallacy you can fall into — I just have to do whatever, screw whoever, it doesn’t matter if it’s dishonest, I’m just trying to get big so I can make the world a better place. That is false. You have to live with everything you do, and be very cognizant of what your personal bar and moral compass are.

And probably one of the most dangerous things is the idea of “do whatever you want, just don’t hurt anybody.” That’s very dangerous — because who does that leave you to hurt? Just you. And that’s very dangerous. You have to be very thoughtful about what your actions measure up to.

Number two, there are a lot of people I knew who were too far in the opposite extreme: I’m going to make as much money as possible, and then I will do good, and then I will be a good dad, and then I will donate to charity.

Philanthropy is a muscle that is learned and developed. It is not a switch that you flip on or off. And if you spend a lifetime gathering assets, you will not have the muscle to be able to distribute those assets very effectively.

I look at somebody like Warren Buffett — I don’t know that he’s the most philanthropic dude ever. What are the things he’s made the most money from? Candy and sugar drinks. And Apple, which is a great investment, but maybe human rights violations. Nothing about what he has done has been philanthropic per se. But he’s getting to the end of his life saying I’m going to give all of it away.

When you look at the first principles of a lot of what he’s done, though — he has not been incredibly selfish in the way he’s done it. He aligned incentives perfectly: if I build Berkshire Hathaway, I’m going to get enriched the same as you, rather than trying to charge as many fees as humanly possible. So there’s an element of him building that muscle over time that made him comfortable doing what he’s going to do.

(34:08) Religion versus technology is a matter of altitude

Spencer Kier: How do you reconcile tradition and religion — an anchoring in the past — with a day job that’s all about progress?

Kyle Harrison: I personally don’t have any conflict or contradiction that I see in religion, science, technology. I think it is all a matter of the scope with which you peruse the problem.

There are elements of scientific reality today that, if you demonstrated them to somebody operating within a scientific paradigm from a thousand years ago, would absolutely be fall-to-your-knees, worship-the-magic levels of insanity. They don’t have the construct to understand it.

And now it’s so funny to me that we get to this point technologically and we say: religion and all this, it’s so stupid, we know all this stuff now. I was reading recently about dark matter and dark energy — collectively they make up 40-plus percent of the universe, and we don’t have a clue what they are. And we’re going to say, well, we’ve got to figure it out — those idiots from a thousand years ago, they didn’t have any idea, but we know all the things.

I am willing to acknowledge that I don’t know all of the things. I’m still trying to figure out a lot of them. Things I’ve heard that are outside the realm of the provable today make me feel better about the construct of the universe that we live in.

As a religious person — Jesus had basically one rule: love God with all your heart, mind and strength, and love your neighbor as yourself. People get really caught up in the love God thing because they think it’s a magic being we have to worship, and what did he do to deserve it. I think it’s more that we’re supposed to have this analogy to learn from — these attributes to learn from, to make us better. If you really love yourself, you will want to become better. And then if you’re loving your neighbor as yourself, and your neighbor is literally everybody —

There’s a comedian who jokes about this. But what if they invade where we’re living? Love everybody. But what if they look different than us? Seriously — love everybody. I don’t know what’s so hard about this.

I can boil it down to those simple principles of truth. Those make the universe feel better to me, and shape how I raise my kids and how I think about the world.

So when I think about science and technology, and why I get excited about investing in it — I see that as a way to grow closer to God. Because if God is a creator, we are also trying to create things. There is a spark of creativity in every human being. It’s part of looking up to that analogy of creativity — this is the most creative being in the universe, and we are trying to be more like that. So creating new things and solving problems is part of that.

(37:23) What’s always true, and what won’t be

Spencer Kier: What was true a generation ago in VC but is now outdated — and what’s true today that will be outdated a decade from now?

Kyle Harrison: First of all, you’re calling into question maybe the worst branding decision I’ve ever made, because everybody I talk to hates that name. I usually refer to it just as Investing 101, because I’m still probably figuring out the basics — I’ve got time to figure out the 2.0. But that was my original hypothesis in writing and why I named it that: what are these foundational principles, and how can you better understand them by reinventing the future?

Your question is a really good one, because it’s basically — we can crack on all the first principles of venture, and whichever ones break and allow us to move forward, those are the things that were never first principles to begin with.

When I think about what’s always true, I come back to capital allocation as an exercise. There’s a very core, unchanging economic model: capital can be allocated to maximize itself or to minimize itself. That’s the equation we’re all operating on. The first principle a lot of people have lost sight of, but that is still fundamentally true, is that a dollar is a dollar is a dollar, and a dollar can be allocated in different directions. The impact of that dollar needs to be quantified in a few ways, but the maximization of that capital needs to be one of them.

That’s why I come back to justifying why you exist. There are a lot of firms that economically don’t make very much sense. Maybe they generated a few returns in a certain way, but they haven’t consistently built an engine that maximizes capital. And no matter how hard you get away from that — at the end of the day you’re allocating capital, and you need to be held responsible for the impact of your capital.

I had a really hard time with impact investing, which I did some of early in my investing career and never really liked, because I always felt like we were saying well, it’s not a good allocation of capital, but it’s not too bad, and look at the positive we’re having. The thing that broke me is I looked at how difficult it actually is to allocate capital altruistically. It’s really hard to not have a negative social impact. A lot of impact funds have actually had more negative social impact than positive.

One of the lines I really like is Chris Sacca at Lowercarbon, where he says: I’m going to get way richer doing this than I ever did investing in tech companies. I want the greediest son of a gun who doesn’t give a crap about ESG or the planet. I want to make that guy money — because if I can get that guy to buy in, I can get anybody to buy in. Any of the people who also want to have a positive impact can see that guy making a ton of money.

There are negative externalities that haven’t been applied to some elements of technology — you could argue we should net all the capital people made off Facebook against any negative implications of that technology. There’s a lot of fuzzy area in how you quantify non-capital outcomes. But the thing that’s true is that fundamental principle: our job is still always about identifying ways to maximize capital.

The thing that has changed, and that will set up the next wave — it’s effectively the modularity of people and resources, which is more disconnected than it has ever been before. Historically the only way to build an organization was packaging resources and people into very concrete things. Now you look at the unbundling of that — cloud computing, AI code assistants, no-code tools, social media.

But I also look at things like MrBeast, and how a very small group of people has been able to accomplish a significant amount of value creation, where attention gathering is the game. His videos get so many views that most brands can’t afford placements — it’s like a Super Bowl ad, and not everybody has the budget to run one all the time. That’s one of the reasons he launched things like Feastables, a candy bar: if I can use my own value to drive value to my own products, then it justifies not getting an advertiser.

It comes back to a core first principle — he has capital or a resource and he’s allocating it effectively. What’s unique is that within the core business of creating videos, he doesn’t need the same consolidation of hundreds of people working in one company in departments. It’s a very decentralized thing, and the MrBeast franchise is still a multi-billion-dollar organization based on the value they’ve created.

I think meaningfully in the future there could be companies valued at a billion dollars, generating hundreds of millions of dollars of revenue, with maybe one person working with them — especially with AI agents that will eventually become more capable. That decoupling, having these modules of people and resources, is very different. And I don’t know how venture works as well in that model — because if you have one person, what costs do you have that require a significant amount of capital? More people are talking about how do we invest in people as opposed to entities. I think those things could have actual implications for how businesses get built and how capital gets allocated.

(45:21) Writer who invests, or investor who writes?

Spencer Kier: Which are you?

Kyle Harrison: Maybe this is a boring economics way of thinking about things, but I consider myself an allocator.

My day job is allocating capital — I am an investor in that way. But to my kids I’m an allocator of time and attention. To my audience I’m an allocator of words. I try to think of myself as a finite pool of resources, and I measure myself on how I’m allocating those things.

Even spiritually, I think of myself as having a finite amount of discipleship that I can allocate to God. And how well am I doing at allocating that? Not that much — I’m way more of a disciple to my phone than I am to God sometimes.

So there are a lot of these pockets of resources that I have as an individual that I’m allocating, and some I’m allocating better than others. But if I had to define how I think about myself in a uniform identity, it’s that allocator. Because I’m also always judgmental of myself — I’m not doing a very good job allocating my attention right now, with my wife, in this relationship, in this conversation. That’s constantly how I’m evaluating myself and defining my own identity.

(47:05) Systems, and the test that actually matters

Spencer Kier: Do too many systems take the joy and presence out of life?

Kyle Harrison: Net-net it’s positive. I wouldn’t consider myself a productivity maximalist. There are people who measure everything they eat, everything they do, every minute of their day. There have been times in my life I’ve used a time log — I use Roam every day for note-taking, and I used to keep a log at the bottom where I’d literally check my watch: at 11:01 I got up to go to the bathroom, at 11:03 I started checking my emails. I tried to keep track of every minute of my day. That worked a little bit in my workday; it never worked in my personal life. So I’ve sort of given up on productivity maximalism.

Instead, my systems are more about: have I created memories and artifacts that I review later that forced me to change my behavior and change who I am or what I’m doing? If I do that, I’ve done a good job — my systems have worked.

If I look back at a journal entry, at a photo I’ve taken, at a video diary — my family and I occasionally do video journals together where we talk about how things are going. Or even just my notes. My relationship with Roam Research is probably the most poignant — I’m constantly reviewing notes I’ve taken, thoughts I’ve had, quotes I’ve read, and reflecting on them, and having that impact the direction my brain goes.

Since COVID started I don’t read as much as I used to. When I had a commute I was probably reading 40-ish books a year, and now I read maybe 11 or 12 — and four or five of those are Brandon Sanderson audiobooks, because I read while I work out. So my engine for taking in information has had to change. But writing consistently is probably the reason I’m okay with not reading as much, because I’m reading a ton of stuff for my writing. If I wasn’t writing and I wasn’t reading, I’d start to feel the pressure to create a different system.

Spencer Kier: You have the Flannery O’Connor quote pinned — “I write because I don’t know what I think until I read what I say.” And elsewhere: “writing is a lagging indicator of observation.” What is it about writing specifically?

Kyle Harrison: If you’ve ever had the experience of bending your body in a way — I have three kids, so I’m frequently bending backwards to get into the back seat to hand them something. Every once in a while it’s just such a way, reaching under something, over something, around a car seat, and there’s a tweak in my neck. You realize there’s a muscle getting stretched that you haven’t felt before.

And that’s so weird, right? I have this body with me all day. That muscle didn’t just get added — it’s come with me everywhere, every day. But I didn’t use it.

Observation is another one of those things we take for granted. You’re observing stuff every day, all the time. You’re intaking information, your brain is processing it constantly. And if you don’t stop to stretch your mind in a way you maybe haven’t stretched it, you may not even realize the observations you have in your mind.

There’s another thing I joke about — there’s a little bit of truth in every joke. You made an observation and it was funny, and we all laughed, and we laughed because we kind of think the same thing. If you make a joke about me being ugly, we all kind of think I’m a little bit ugly — or else we wouldn’t have laughed. If you make fun of Ryan Reynolds for being ugly, nobody laughs, because it’s not true. We’ve made observations.

So that act of forcing yourself to reflect on your own observations and inputs with an output is the only way you realize — man, I don’t even know that I realized that.

The other way I enjoy — maybe one of the reasons I started a podcast — is conversations like this. I’ve probably said a dozen things in this conversation that I don’t know I’ve articulated that way before. So writing is my favourite common way to create that output and reflect on my observations. But ranting with someone, jamming on stuff — that’s probably my number one favourite way. I just don’t record it enough. That’s why I try to do more podcasts, because when I’m ranting with my friends at night, I’m not recording it. And who knows how many awesome things we’ve lost by not recording our conversations.

(53:52) Crossing out every day on the calendar

Spencer Kier: Do you write because you’ve built a habit, or because it’s a compulsive need?

Kyle Harrison: This goes back to productivity maximalism. I’ve tried at times to have systems that force me into doing something, and almost always those systems fail me — mostly I fail my systems. Human frailty. And often if you have too many goals it’s too difficult to do a bunch of different things, so you give up on the whole bag.

I technically started writing middle-to-end of 2021 and started publishing in 2022. And at the beginning of 2022 I thought: I’m going to fail if I try to create all these intricate systems. So I said, I’m going to set one goal, and that goal is that I want to publish something on my Substack every week without fail. Never miss a week.

I took this from — Jerry Seinfeld has this, I call it Seinfeld’s calendar. He says your job as a comedian is one job: get a calendar, put it up on the wall, and write jokes. Every day that you write jokes, you cross out the day. And your only job is to build as long a chain of unbroken X’s as you possibly can, without ever missing a day. That’s your whole job. Just write jokes, write jokes, write jokes.

So I thought about it the same way. If I want to write, what’s the one thing I need to do? Well — it’s just to write. It’s not about writing quality. It’s not about writing certain content. So I said, alright, I just want to write.

This past week was my 89th week without missing a week. Many of them are not good. Some have been I’m driving and I’m about to lose service on a camping trip, and I’m literally on my phone writing up a post saying search the word “grass” in my Substack — usually that’s touch some grass, return to grass. That’s me saying, I’m going to go touch some grass, sorry, this week sucks. That’s me trying to maintain the goal even though I’m not doing very well at it.

Some are better than others. But that one goal — I just don’t want to miss a week — is the thing that’s made it really powerful for me.

(56:24) Only take opportunities that stick around

Spencer Kier: You’ve written that people think they’re too busy to take advantage of great opportunities, and that we should instead let opportunities survive as long as possible and take the best ones that stick around. Can you elaborate?

Kyle Harrison: This is a deep cut, because I don’t think most people have read the piece this quote is from.

I talk about this concept a lot — the natural selection of time. I try to pay attention to core experiences in my life. On my personal website I refer to them as my music. When I was on my mission for my church for two years, I tried to pay attention to the best lessons I learned, and they were usually encapsulated by a memory — an experience captured in a phrase or a sentence. That’s my music. When I left college I did the same thing. My first job, the same thing. Core concepts that make up how I think about the world.

One of the things in my music is this idea of the natural selection of time, and it came from two experiences in college that I mapped together.

I had the opportunity to interview for an internship at Mitt Romney’s family office in Boston — I was trying to build my experience in investing, and as most BYU people do, I really like Mitt Romney. This was ten years ago. I was in Africa with my second startup at the time. They offered it to me and I agreed — and then I went to tell my wife, and she said: I have one class to graduate and it’s only offered this semester. If I don’t take it, I have to wait a whole year, and by then you might have another job and we’d have to move. Finishing her degree was important to her, and she couldn’t finish it if she didn’t do that class.

We considered her staying in Utah while I went to Boston, and we didn’t like that — we were pretty newly married. So I called and said, I’m so sorry, but please, I’d love to keep in touch and find something else.

The semester passed, and then I got another job offer that could lead to a full-time job. And they called and said, how about this semester? And I said, I’m so sorry, I just got this job I can’t say no to. But please, can we keep in touch? And they said, yeah, no worries.

And then while I was at that internship, they called and said, alright, how about this semester? And I said — let’s do it. I went to Boston, and it was great. I loved the people I met, I learned a ton, and I’d credit some of what I learned there with charting my path into venture and why I focused on what I focused on. I allowed that experience to survive.

I’d counter that with an experience from when I was an undergrad. A seed fund in Utah, Kickstart Seed Fund, had a student-run venture fund called Campus Founders Fund, where we’d invest $10–20K checks into student-run companies at Utah schools. I’d been doing it for about a year and was helping recruit — messaging people on LinkedIn at different schools with interesting backgrounds, saying I’m recruiting for this thing, it’s been life-changing for me, it’s been my introduction to venture.

I can’t tell you the dozens of times people just said: Hey, sorry, I just have a busy semester. No follow-up, no let’s keep in touch. Just, sorry, too busy. Okay — I’m not going to message you again.

And there was one woman who responded and said: “I’m super busy, but I would love to do this. Is there any way we could figure out a way to do this?” She was in no way headed into venture and startups — she was looking at consulting and finance. And she kept that opportunity alive with me, and was in that program. And now she works full time as an investor at Kickstart Seed Fund doing seed investing in Utah. She’s amazing. That experience happened because she allowed that interaction to stay alive.

So I’ve been on both sides of the keeping-an-opportunity-alive table, and I try to apply that to life. There’s a burning-the-boats mentality where you can’t constantly keep your optionality open. But if you don’t have to kill something, then why kill it? Maintain the conversation, keep those conversations open — because you never know when something good might arise down the road.

(01:01:39) Regret minimization

Spencer Kier: You’re a fan of Bezos’s regret-minimization framework. What regrets are you trying to minimize?

Kyle Harrison: Hands down, without a doubt, the number one thing I am most terrified of is getting to the latter years of my life and my wife and I don’t have a relationship — we barely talk to each other, we’ve stuck around because of the kids, we just have no relationship. Or my kids are so deeply uninterested in me that they just don’t care, don’t really engage. I am their dad by genetics alone.

Those are my biggest fears. Nothing will make up for that. I can make billions of dollars, and if I don’t have those relationships with the people that I love the most, none of that’s going to matter. That’s not going to help me feel better — to drown my sorrows in my billions, like Scrooge McDuck.

My number one priority is making sure I have a meaningful relationship with my wife and my kids, and trying to find mechanisms to do that. And I’m probably hardest on myself when I fail at that — when I’m too angry at my kids, or I’m not present enough for my family. Those are absolutely my biggest presupposed regrets.

(01:03:18) The closing question

Spencer Kier: I ask every guest — what’s one question you’d leave listeners with?

Kyle Harrison: It comes back a little to this allocation idea of who we are. The question is fairly simple.

If you could go back a year, five years, ten years — and know what you know now in that moment — what would you do?

Most people say buy Bitcoin, or buy Amazon stock. And it’s like, alright, focus up: what are the things in your life you might change or do differently? And maybe it is buy Amazon stock.

Okay — now fast forward back to today. What are the Amazon stocks or the Bitcoins of today? What are the I wish I hadn’t passed up that job, the I wish I’d never gotten into business with that person — what are today’s versions of those?

Because you can’t change the past, but you can learn from it, and you can impact your future. So go back in time, ask what you’d change, and identify the same things you’re going through today that you can impact — that will hopefully have a more positive outcome for you in the next year, five years, ten years.

Spencer Kier: Kyle, thank you so much for your time.

Kyle Harrison: Thanks, Spencer. This was super fun. I appreciate it.

Connections

The show

Audience of One · Spencer Kier — episode #037. Spencer’s premise is exploring his own curiosity, which is why this ranges further outside venture than any other appearance.

Essays this episode maps to — including one he hadn’t written yet

The Value Chain of Capital — he describes the idea here and says outright that he hasn’t written it. See the provenance note below; the essay published between recording and release.
The Pace of FOMO Cycles — the opening subject, published four days after this episode aired.
The Renaissance of Rise and Grind — cited by name in the ambition section.
Investing 101 — plus his verdict on the “2.0” in the name: “maybe the worst branding decision I’ve ever made.”
The Glass-Half War — Empty or Full — “there’s a little bit of truth in every joke” appears here in October 2023, six months before it anchors that essay.

Contrary’s model

Contrary — the two beliefs, tested by what a firm actually does: every company is a collection of people, and every firm should justify its own existence (“what job should a founder hire your money to do?”).
Talent Vortex — intense, relentless curiosity as the single characteristic, and curiosity begets curiosity as the mechanism. Spark them, don’t manufacture them.
Contrary Research · Foundations & Frontiers · How We Work — the three content lines as product SKUs independent of any company. How We Work interviews airline pilots and tunnel engineers precisely because technologists otherwise build only for themselves.
Clayton Christensen · Jobs to be Done · Innovator’s Dilemma — the frame for why relationships are the moat now that the old barriers (servers, distribution, on-prem) have collapsed.
Nomic — named as the AI investment they do have, against a policy of making fewer than most.

Judgement

Triangulation — two data points don’t give you the slope of a career; the marriage analogy (see them sick, early, late, on a road trip, lifting heavy things) is the best version of this idea in the corpus.
“The loudest lessons are often the worst lessons” — broadcastability selects for generality, and generality waters lessons down to invalidity.
Peter Thiel on competition · Paul Graham on solving a problem you’ve lived and on great work.
Fred Wilson — investing behind hype cycles is the worst way to make money; a good company at a bad price is a bad investment.
Venkatesh Rao — AI as the wave where most of the talkers are spectators, not participants.

Values

Stephen Covey — circle of influence and control, used to argue that scale increases capacity to do good, fenced on both sides.
“Philanthropy is a muscle that is learned and developed. It is not a switch that you flip on or off.” Tested on Warren Buffett, who then gets credit for aligning incentives rather than maximizing fees.
The dismantling of “do whatever you want, just don’t hurt anybody” — “who does that leave you to hurt? Just you.”
Religion and technology as “a matter of altitude” — today’s science would read as magic to a thousand-year-old paradigm, and dark matter and dark energy are most of the universe and unexplained. Creation as a way of growing closer to a creator: “there is a spark of creativity in every human being.”
Impact Investing — his critique from having done some: it is really hard not to have negative social impact, and many impact funds net out negative. Chris Sacca at Lowercarbon as the preferred framing.

Writing and systems

“I consider myself an allocator” — of capital, of time and attention to his kids, of words to an audience, and of discipleship. “I’m way more of a disciple to my phone than I am to God sometimes.”
“Writing is a lagging indicator of observation,” with the stretched-muscle analogy for why you don’t know what you’ve noticed until you produce an output.
Seinfeld’s calendar — the mechanism behind the weekly goal, and the half of that story missing from the Sourcery telling and the Idea Exchange telling, which both credit Rex Woodbury for the reframe without naming the mechanism. 89 consecutive weeks at recording.
Roam Research — the abandoned minute-by-minute time log, and the test that replaced it: have I created memories and artifacts that I review later that forced me to change my behavior?
Flannery O’Connor · Brandon Sanderson — the pinned quote, and the honest admission that reading fell from ~40 books a year to 11 or 12.

The forward-looking bit

MrBeast — modularity of people and resources; Feastables as the answer to brands not affording his placements; and the 2023 projection that billion-dollar companies could run with one person plus AI agents, with “how do we invest in people as opposed to entities?” as the open question for venture.

Life

Regret Minimization · Jeff Bezos — and an answer that is entirely non-professional: the fear of reaching later life without a relationship with his wife, or with kids for whom “I am their dad by genetics alone.”
The natural selection of time — “my music”; the Mitt Romney family office internship declined twice and kept alive; and the Campus Founders Fund recruit at Kickstart Seed Fund who answered “I’m super busy, but I would love to — is there any way?” and is now an investor there. “If you don’t have to kill something, then why kill it?”