🌟 Hey there! This is a subscriber-only edition of our premium newsletter designed to make you a better founder, investor, and technologist. Members get access to the strategies, tactics, and wisdom of exceptional investors and founders.

Friends, 

When Vinod Khosla arrived in Silicon Valley in the late 1970s, Sequoia Capital and Kleiner Perkins were just a few years old. Apple was barely out of the garage, the first web browser was more than a decade away, and the mobile internet remained a fancy of science fiction. 

Over the past 50 years, Vinod has witnessed and participated in multiple tectonic technological shifts, from the protean proliferation of the internet to the advancement of computation biology to the imminence of superior artificial intelligence. In that time, he has been the contemporary, employer, or backer of the industry’s most consequential entrepreneurs and executives: Steve Jobs, Jeff Bezos, Larry Page and Sergey Brin, Elon Musk, Bill Gates, Andy Grove, Eric Schmidt, Jack Dorsey, Sam Altman, Patrick Collison, and many, many more. He has, in short, one of the greatest longitudinal views of high-performance innovation of anyone on earth. 

Because of that, I was particularly keen to hear what patterns or shared traits Vinod has observed over the years from partnering with some of the world’s most inventive, disruptive people. 

To hear the characteristics Vinod finds predictive and learn which up-and-coming founders he considers especially exciting, read on. 

Lessons from Vinod

1. Flexibility and stubbornness. The best entrepreneurs are “flexible in their tactics but obstinate in their vision,” according to Vinod. They must be willing to adapt to the game on the field but constantly keep their end goal in mind. Sam Altman and Patrick Collison are founders Vinod believes exemplify these traits. 

2. Discerning learners. To survive as a startup CEO, you must be or become a learning machine. The job is so varied that it requires you to level up, day after day, week after week. Exceptional founders are not only fast learners; they are discerning ones. They have no problem throwing out bad ideas, even if presented by a perceived authority figure. They’re equally happy to accept good ones, no matter their provenance. 

3. Some problems are too important. There are dozens of frameworks and heuristics venture capitalists use to analyze potential investments. For some opportunities, Vinod asks himself a simple, but powerful question: how crucial a problem is this startup solving? Over the years, the Khosla Ventures boss has backed companies principally because they were “too important not to do.” Think nuclear fission, AGI, or plant-based meat. 

Keep reading for several more insights from Vinod.

The Vinod Khosla Collection

Today’s letter marks the end of my correspondence with Silicon Valley legend Vinod Khosla. In case you missed it, over the last six months, Vinod and I have dug deep into his origins, his first entrepreneurial efforts, the successes of Sun Microsystems, his multiple grand slams at Kleiner Perkins (perhaps the best run in venture history!), and much, much more. 

By becoming a premium subscriber, you’ll access the entire Vinod Khosla letter collection and unlock all of the following: 

• +12,000 words of correspondence between me and Vinod. Hear his lessons and insights in detail.  

• 8 letters covering key chapters in Vinod’s life, from launching Sun to investing in OpenAI. 

• 4 grand-slam investments Vinod made at Kleiner Perkins and the rationale behind each one of them. 

• The 2,500x return on Juniper Systems and how Vinod spotted the supertrend that inspired his investment. 

• The “smart people thesis” that Vinod used to improve his investing and how it led him to back Google. 

• 2 failed startups Vinod attempted and why he believes failure “doesn’t matter.”

• 2 failed startup investments that Vinod still thinks about and why they didn’t work out. 

• The simple but impactful framework Vinod used to hire pre-eminent talent at Sun Microsystems, including future Google CEO, Eric Schmidt. 

• Where innovation comes from, informed by Brian Chesky and Elon Musk. 

Whether you’re a founder or venture capitalist, it’s always a good decision to invest in yourself. Join our premium newsletter today to do exactly that and learn from one of the great technological and investing minds of the past 50 years – delivered in an intimate and intuitive format. 

Mario’s letter

Subject: Founder Mode
From: Mario Gabriele
To: Vinod Khosla
Date: Monday, September 9 2024 at 13:41 PM BST

Vinod, 

Like the rest of the industry, I read and enjoyed Paul Graham’s post “Founder Mode.” As you no doubt know, it paraphrases a recent speech from Brian Chesky, founder of Airbnb. 

At a recent Y Combinator retreat, Brian cited his belief that most conventional management advice is not only incorrect but actively damaging. To build a great and durable company, he argues, founders must ignore traditional wisdom and learn how kindred spirits like Steve Jobs ran their businesses. 

Paul refers to this as “founder mode,” a style of building that sits in opposition to the “manager mode” espoused in most business books. 

It’s a topic I’ve been thinking about for some time now, greatly aided by the clarity and language of Paul’s piece. Last month, for example, we published The Elon Musk Playbook, highlighting how the SpaceX and Tesla founder’s management runs counter to the orthodoxy. 

I have also thought about Founder Mode a great deal in the context of our correspondence. Over these past few months, we’ve explored your early entrepreneurial origins, the differentiated ways you built management teams and instilled high-leverage cultures, and the extraordinary builders you’ve partnered with. You have lived in Founder Mode and known many of the best to architect their companies in this style, from Jeff Bezos to Larry Page and Sergey Brin to Elon Musk to Patrick Collison to Max Levchin to Brian Chesky, the man that spawned the post. You have known many of the great managers, too, such as your initial inspiration Andy Grove, and old employee, Eric Schmidt. 

Throughout our correspondence, there have been anecdotes that seem to capture some of the Founder Mode ethos. For example, in one of our previous exchanges, you noted there had been a debate at Square about whether to launch Cash App. Had Jack Dorsey listened to the conventional wisdom of maintaining singular focus, he would have lost out on much of Square’s market cap.

It’s a neat example of the kind of contrarian decisions founders have to make and hints at the people behind them.  

In our final letter, I would love to focus on this fertile ground. Of the great founders you’ve worked with, what unites them? When you meet an entrepreneur, what signals portend real promise? As they develop, what decisions do they make that less gifted founders might not? As much as you’re able to articulate, I’m keen to understand how you filter for exceptional entrepreneurial talent as an investor and what collaborating with these people has taught you about innovation and constructing large, durable businesses. 

The names we’ve mentioned so far are all well-known and lauded as luminaries in our industry. As you look toward the next decade, which founders do you think have the opportunity to join their ranks? Do you find that the way you work with contemporary founders – the advice you offer, for instance – has changed over the years? What advice would you give to other founders just beginning their journeys? Your career has allowed you to build one of the best personal, longitudinal samples of great entrepreneurs in history. I would love to hear the observations it has sparked. 

Lastly, I just want to end with gratitude. When embarking on this correspondence, I knew I would find it fascinating and fulfilling. However, I didn’t fully appreciate just how fascinating and fulfilling it would be. I’ve learned the power of ignoring your failures, the unreasonable tenacity that can turn even the firmest “no” into a “yes,” the simple but effective way to identify and recruit talented employees, the shape of supertrends (and the rewards they can yield), and much more. It is not an exaggeration to say that your stories have helped me dream a little bigger, be willing to risk a little more, and persevere with added ferocity. I am sure the same is true for many of our readers as they build and back the companies of tomorrow. 

With my sincere thanks,

Mario

Vinod’s response

Subject: Founder Mode
From: Vinod Khosla
To: Mario Gabriele
Date: Wednesday, September 25 2024 at 10:59 AM PST

Mario, 

It has been fun to have this conversation with you over the last many months. I am glad it has been helpful to you, and hopefully to many other founders as well. 

You’re right that I’ve gotten to work with many great entrepreneurs who have built incredible companies. Every founder is different, of course, but they do have shared traits. 

What I’m looking for in a founder, above all, is someone flexible in their tactics but obstinate in their vision. Patrick Collison is a great example of a founder who is flexible in his tactics. He learns extremely quickly and is able to adapt and iterate. Sam Altman from OpenAI, Max Rhodes from Faire, and Max Levchin from Affirm are other good examples. 

If you sit down with Patrick, for example, you can see how fast he processes. He asks a ton of questions. He wants all the input from you. And based on the feedback he gets from his questions, he’s happy to change his mind. 

People like Patrick or Sam quickly accept good ideas and reject bad ones. If they receive new information that invalidates their opinions, they change their minds. If they receive unconvincing information, even if it comes from an authority figure, they reject it easily. They’re not arrogant about their thinking. They just want to find the best answer...