Sept. 29, 2022

How to Stop Hackers from Stealing Your Data

Plus: Why Jeffrey Katzenberg chose Silicon Valley over Hollywood


Nora discusses the shifting venture capital landscape and the future of digital security with media mogul Jeffrey Katzenberg and entrepreneur Hari Ravichandran, the founder and CEO of Aura, a digital security company. Katzenberg’s venture capital firm, WndrCo, backed Aura, which last fall reportedly raised $200 million at a $2.5 billion valuation. For more info on our presenting sponsor, check out realvision.com/businesscasual

 

Host: Nora Ali

Producer: Olivia Meade   

Video Editor: Sebastian Vega

Production, Mixing & Sound Design: Daniel Markus

Music: Daniel Markus & Breakmaster Cylinder

Fact Checker: Kate Brandt 

Senior Producer: Katherine Milsop

VP, Head of Multimedia: Sarah Singer 

 

Full transcripts for all Business Casual episodes available at https://businesscasual.fm

Transcript

Nora Ali: For Morning Brew, this is Business Casual, bringing you convos with people you know, and some you may not know yet, to make business less intimidating. Because money talks, but it does not have to be dull. I'm your host, Nora Ali. Now, let's get down to business.

There is a reason this topic keeps coming up on the show. Our data on the internet just is not safe. Hackers keep hacking; bad actors keep bad acting. And as a result, the cybersecurity industry is booming. By 2027, market research company Brandessence projects that the global cybersecurity market will reach $403 billion. This growth is in large part due to the increasing number of cyber attacks happening each year. You may have heard about one of the latest ones: the teen hacker who recently breached both Uber and Rockstar Games. A cybersecurity company called Aura is revealing just how vulnerable we all are in our digital lives, and trying to help us not be so stupid on the internet. Aura's founder and CEO, Hari Ravichandran, joined us on the podcast alongside media mogul Jeffrey Katzenberg, whose venture capital firm, WndrCo, backed Aura. For context, last fall, Aura raised $200 million at a $2.5 billion valuation.

Jeffrey Katzenberg, the lauded Hollywood executive and co-founder of DreamWorks, is bullish on digital technology, even though he calls himself a digital idiot who has gotten hacked before. He's so bullish, in fact, that he would choose Silicon Valley over Hollywood if he had to start his career today. We touched on a lot of things outside of cybersecurity in this conversation, including what both Hari and Jeffrey seek in the entrepreneurs in which they invest. Hari started his firm, Jump Ventures, in 2017. They also offered some career lessons, and yes, we talked about Quibi, Jeffrey's attempt at a short-form streaming platform, which did not pan out how he had hoped. It's what he calls a crazy-ass moonshot. And with that, he offered some great advice on how to keep going in the face of failure. That's all next, after the break. Jeffrey and Hari, welcome to Business Casual. I'm so excited to chat with you both.

Hari Ravichandran: Thank you, Nora.

Jeffrey Katzenberg: Great to be here, Nora. Thanks.

Nora Ali: Let's start with an icebreaker. This is for a segment called OG Occupations. I would love to know what each of your first jobs was, your OG occupation. So Hari, why don't you go first?

Hari Ravichandran: My first job was at a research center when I was in college, writing code for large parallel computers. That was as an undergrad researcher.

Nora Ali: Wow. So you've been in tech the whole time. That's amazing.

Hari Ravichandran: I have.

Nora Ali: Jeffrey, what about you? Different story, I think.

Jeffrey Katzenberg: Well, yeah, my first job was back in the Jurassic era. I worked for John Lindsay, volunteered in his campaign when he ran for mayor.

John Lindsay: Conditions in most of our central cities are shameful. That shame diminishes the pride of the entire country. The restoration of that pride must be predicated upon a more energetic and powerful direction of this nation's inventive and productive genius to the massive technological...

Jeffrey Katzenberg: Once he was elected in 1966, in my teens, I actually got a job and I was chief gofer.

Nora Ali: I'm sure that taught you a lot, and here you are now.

Jeffrey Katzenberg: I did. It was an amazing education, and spent the next six years working in different ways in city government, and sort of opened my eyes to the world in ways which I could have never ever actually imagined.

Nora Ali: Incredible. Well, this is not our first conversation on this podcast about cybersecurity, because it impacts literally all of us. I know that experts tend to agree that humans are the weakest link when it comes to cybersecurity. And Jeffrey, you got hacked. I loved this.

Jeffrey Katzenberg: I'm not sure that I love that you love it, but okay.

Speaker 5: Reading that, and you Rachel, right before we started, you said you have already hacked Jeffrey.

Speaker 6: Yes, I have.

Speaker 5: This has already happened.

Speaker 6: It's already done.

Speaker 5: And now you control Jeffrey's life; you could just crush him. You can blackmail him for life.

Jeffrey Katzenberg: Cruella de Vil, like bad news lady.

Speaker 5: When you found out how quickly she did it...

Jeffrey Katzenberg: I crushed her. I just, overnight, I said, "You will never be in this town again."

Speaker 5: You'll never work in this hacking town again.

Jeffrey Katzenberg: "You will never hack this town again," is what I said.

Speaker 5: And she goes, "I know your Netflix queue."

Nora Ali: I know you didn't love it, but you got hacked by an ethical hacker.

Jeffrey Katzenberg: Yes.

Nora Ali: And told everyone about how it happened, how it went down. I was kind of shook, because here I am thinking it takes a ton of sophistication to hack into your personal information. But your colleague got spoofed, his phone number, and the hacker who was a woman used a voice-changing device to sound like him. So what surprised you the most about that experience when you got hacked?

Jeffrey Katzenberg: I don't think any of us actually understand how vulnerable we all are. You think about over, say, the last, call it five to 10 years. All of us, I'm sure you and many of people in this audience today, we've all gone out and bought Nest cameras and Ring doorbells and alarms and alerts and all of these things around our physical stuff. But around our digital...basically our phones, our laptops, we've actually done nothing. And our vulnerabilities through them are infinitely greater. If I were so bold as to come to your home and rob you, think about what I would get: some TV sets, maybe computers, a little bit of jewelry, no cash. But if I actually stole your credit card, got into your mortgage, to your identity, your Social Security, any of those things, the damage that can be done to all of us is literally, by a magnitude, greater. I think that's the thing that, for me, really was a wake-up, is just to see how vulnerable we all have made ourselves and how little there is out there today to actually help us.

Nora Ali: I love how confident you were going into it. Because you said, "I'm not that online. I feel like I protect myself on the internet. I'm not out there that much." But hacking, I think, is even more top of mind right now, because Hari, in recent news, a teen hacker breached both Uber and Rockstar Games.

Newscaster: We are learning right now that Uber is suffering a computer system hack. Uber has been hacked. The rideshare company confirmed on Twitter that they are...

Nora Ali: They tricked people versus doing it by brute force. And the person who had claimed responsibility for the hack said he was an IT person and convinced an employee at Uber to share their login credentials. How much of a threat is social engineering, and what does that mean exactly?

Hari Ravichandran: When hacking was getting going and it was much more prevalent in the news and such, you had these script kiddies or people that were doing sort of brute force attacks, and a lot of times they were mostly just for pride. I mean, they would go brag to their friends and tell other people in the community that they got into this or got into that. What's really kind of transformed now over the years is, it's very much a commercial enterprise at this point, where people have the ability to commercialize information that they're stealing. The point of entry, a lot of times, Nora, end up becoming really kind of vulnerable spots inside the system, and a lot of times, that's human beings. Social engineering has gotten a whole lot more sophisticated than it's ever been. The vectors of attack, the way that they can get into your life, has certainly expanded.

I mean if you think about how many devices, how many services you use online, each of those ends up becoming a vulnerability point. As a result, hacker's gonna go where it's easy pickings. And in the case of both of the breaches that you're talking about, they were exactly that. They were social engineering attacks. Even with Jeffrey, like the hack you were talking about, we sent him a spear phishing email, he clicked on it, his computer had not been updated. In that case, it was sort of a backend thing. And with enterprises, they typically will do updates in patches pretty rapidly, but you can't prevent somebody from giving up their credentials. And once you have the credentials, it's relatively easy to kind of penetrate any kind of a system. It's much, much more prevalent, and much more sophisticated than it's ever been before.

Nora Ali: And phishing emails, scam emails don't always look fishy because it can come from an email address that looks just like someone who emails you every day, a colleague.

Hari Ravichandran: Again, in that Jeffrey example, I think it looked like an email from Anthony Saleh from WndrCo, except it wasn't wndrco.com, it was wndrco.co, which cost $8 to go register it. It looked very similar.

Nora Ali: Well, Jeffrey, I appreciate your vulnerability in sharing the story because it's a learning experience for a lot of people.

Jeffrey Katzenberg: The thing that's interesting about it is that when you look at the circle of where it's not just your own device, but it's your immediate family, your kids or your parents, those are equally vulnerable access points in this. Which is why, I think Aura in particular, with the roadmap that Hari has set out for us, which is to actually create something that is sort of for the larger circle of your extended family, because leaving any of them out on the ledge means you're all vulnerable.

Nora Ali: I think most everyone is familiar with password managers now. You have to get one at most jobs these days, and we get emails and pitches for those all the time. But Hari, yours extends beyond that. Your company Aura, there's identity theft prevention, there's things with credit scores. Can you just walk through what the suite of offerings is this, without this being a sales pitch for Aura. But I guess how would you, as a customer, start to parse through all of the offerings that Aura has and figure out, "You know what, this is actually what I need"?

Hari Ravichandran: I think our whole premise was to try to make it as easy for the customers as possible so you don't have to think about this stuff. I think on the backend, what we ended up doing was integrating lots of different points of attack that customers have, whether your identity's getting breached, viruses, malware, phishing, even parental controls and kid monitoring and how your kids can be protected. Soon, we have stuff coming out for seniors as well. So the way we think about it is bring all these things into one umbrella so the customer doesn't need to think about it, and keep on iterating as new hacks and spams and scams come out, to keep them safe. This is kind of the important thing for us here, is do it in a way that it's proactive. In a lot of cases, people wait till after the crime's been committed, and then you have to go remediate the issue, and that's a lot of burden on a customer or a family. What we try to do is, how do you prevent these things so you don't have to go through that headache on the backend?

Nora Ali: You mentioned products for seniors. For those of us who grew up on the internet, we can still get tricked. So I'm curious, how do you create something different that is usable for seniors?

Hari Ravichandran: For seniors, phones still continues to be a huge vector of attack where there are just a lot of scam calls and sometimes you think they're just scams, but really it's information-gathering missions where they're trying to get information out of the seniors that can just be packaged up for some sort of an attack on the backend. So we're launching a call agent where we can look at sentiment analysis of the call that's coming in, in real time, and help the senior determine if it's a scam or a phishing call. And if it is, it sends it off to a call agent on the backend. 

And the other big thing for seniors is delegation, because in a lot of situations, if they're not technically savvy, there may be a family member that they trust. So there's not really a lot of products in the market that allow a senior to delegate a certain level of authority to their kids or grandkids or somebody in their family that they know and trust, to make sure that they're kind of keeping an eye out for a lot of their vulnerability. Those are a couple of the dimensions that we've been working hard on to be able to roll out in Q4 this year.

Nora Ali: I want to get both of your perspective on what it takes to get customers to care about cybersecurity. Hari, from the product standpoint, how do you get people to actually buy Aura before they've been hacked, instead of being sort of reactive? And then Jeffrey, from your perspective as a customer, did it take you getting hacked to say, "You know what, I actually do need this solution. I'm also going to invest in Aura"? So Hari, starting with you.

Hari Ravichandran: You need a simple button, I mean that's really the easiest way to say it, where the user looks at it and says, "Hey, I click the simple button and this is taken care of for me," where you don't have to think about it, curate the products, try to figure out what are the 18 things you need. Is it up to date? Am I fully secure? That's really what we try to do, is try to make things as easy and simple for customers as possible, and have the system be a learning system. But even with that, you still have to educate the customer, because a lot of times, people don't connect the dots. I mean they see that their information from...even the ones you were talking about, like from Uber, if there was a breach and their information got out, you don't think twice about it. But that is going to come back in some way and affect you, whether it's around your credit, it's around your identity, or some other element of your life.

So a lot of education and getting customers to understand that these events in isolation don't seem scary. But if you've been part of a couple of breaches, if you've had some of your privacy sort of compromised, et cetera, it could potentially come back in a very personal way that's a heavy lift to be able to fix or remedy on the backend.

Nora Ali: And Jeffrey, how about you?

Jeffrey Katzenberg: Every day now, I mean it's literally every day, all of us are becoming more and more aware of these breaches, of these phishing attacks that are going on, and that it's not just somebody else's problem, it's now becoming your friends, the people next door, your relatives. It's happening to every one of us. And so, you look at the last, call it 18 to 24 months, a lot of this, again, something that's sort of been stirred up even more so out of sort of post-COVID world. And so we are all actually becoming more and more aware of our vulnerabilities, and the opportunity of Aura is to, as Hari says, take something that's way too complicated for any of us to understand. I don't understand. I mean, I'm a digital idiot. I don't know...you know, Hari rattled off 10 different things—malware, antivirus, VPN—like do I need any of those things? Do I need every one of those things? I want someone else to figure it out for me, and I want them to have a Good Housekeeping seal of approval that I know they are best in class, that they actually deliver on the promise of what they say they're going to do. And that's what Aura set out to build and to deliver to the consumer, and so far, is just on a great track to do that. It's a new need and therefore it's a new product, and I think we've set a very high bar, a very high standard for the quality and reliability of what we're doing. Therefore, we're going a little slow as opposed to just leaping in, and I'm very proud of it. This is an opportunity where you can do good while doing good. So I'm very excited for the new product launch, which is less than 60 days away, and for us to actually then be able to bring it direct to consumers.

Nora Ali: Hari, do you tend to see a bump in customer interest when there is big news of a public breach like that of Uber?

Hari Ravichandran: Yeah, I mean, very much. For example, when the Equifax breach happened a couple of years ago, or anything that affects credit, your bank information, financials, or family safety. If there's a breach that sort of is in that zone, people do kind of sit back and take attention at that point and see if anything's gotten out. I think if it's sort of a more mundane, run-of-the-mill type of a breach, you don't see a whole lot. But the bigger ones that have financial or family impact tend to get a lot of attention.

Nora Ali: I'm definitely feeling pretty nervous. I think it's time for me to take control of my own cybersecurity, after like the fifth conversation about it on this podcast. Here we are. Oh my goodness. We're going to take a very quick break. More with Hari and Jeffrey when we come back. So Hari, we recently spoke with Corey Thomas, who's the CEO of Rapid7, which is a cybersecurity company that focuses on corporate clients. We had a discussion about the hacker economy and how it's booming, it's robust, there's people who specialize and work together to hack into companies for millions and millions of dollars.

Corey Thomas: We traditionally had this idea of hackers as these lone individuals in a very, very dark basement that were actually stealing your credit cards and using it, which is a nice idea. It's kind of cool. Made popularized by lots of movies. When we talk about the hacker economy, though, what we're actually talking about is an entire ecosystem. So here's what I mean by an economy, is, it's the specialization and the cross-section of different people that play different roles together to maximize the amount of money that they actually steal from individuals and corporations.

Nora Ali: As an engineer, what is top of mind for you when it comes to the hacker economy and how sophisticated these teams of people are getting?

Hari Ravichandran: I think there's stacks of this, and I know Corey pretty well, so hello to Corey, as well, if he's listening. But in this sort of setup, you've got almost stacks of people. So you've got people that are phishing, harvesting information from consumers, and leveraging consumer information. For example, Nora, if you're using the same password across five different services, you might use it for your corporate email. You may also be using it for your DoorDash account. And if DoorDash gets breached, now the enterprise has some vulnerability because the same set of credentials, and a simple social engineering attack could be able to infiltrate the enterprise. And it goes all the way from there to more sophisticated hackers that are looking for trade secrets, that are looking for information that they're commissioned to go get from enterprises, all the way to nation states that are basically sponsoring some level of infiltration across critical enterprises, et cetera.

It's a full stack that goes from bottom to top. They're all different players, but the intent is the same, which is to basically commercialize the data and information that they're picking up on the backend. And what this ends up doing is, it's sort of the weakest link pieces, which is wherever there's a weakest link in each of these different ecosystems. It could be a simple password that a user's using across three or four different things, all the way to something where there are IT systems that are not fully fortified. It's a very difficult problem to get down to zero risk. So really, what I think about a lot is, what are all the different ways that you can drive better hygiene across that particular ecosystem? Whether it's an enterprise that's being breached by somebody looking for trade secrets or it's a smaller company that's getting breached by their employees not having good hygiene.

The more and more you can do to converge better digital hygiene inside each of these ecosystems, the better off you are. Now, some have a lot more dollars going behind it when you get to bigger enterprises, but even with that, the crimes are much bigger, and the kind of people that are attacking are even more sophisticated than perhaps something on the consumer side. But it definitely is a difficult problem and it's something that needs participation through all players, whether it's overt or just something you're just doing to maintain good hygiene online as you use services.

Nora Ali: I feel like most people probably don't have great hygiene online when it comes to especially using passwords across multiple accounts. Jeffrey, I'm curious, what was your approach to passwords before you discovered Aura? Did you reuse them? Were they weak passwords? I just want to know.

Jeffrey Katzenberg: I got one. I use it for everything.

Nora Ali: For everything.

Jeffrey Katzenberg: You know, work, play, everything. Stupid. No longer, by the way.

Hari Ravichandran: Jeffrey uses "hakuna matata," that's his password.

Speaker 9: Repeat after me. Hakuna matata.

Speaker 10: What?

Speaker 9: Hakuna matata. It means no worries.

Jeffrey Katzenberg: Hakuna matata is my password. No one would ever guess that.

Nora Ali: Better than password 12345, that's one step up. I want to broaden out a little bit and just talk about the sort of VC landscape as it stands now. We had Jager McConnell, who's the CEO of Crunchbase, on recently, and he told us that growth at all costs is dead.

Jager McConnell: So people going in saying that just that: We're gonna triple, triple, double, double, double, that used to be a thing that people would say. Now it's more around, what is your burn efficiency? What that means is, for every dollar of ARR or recurring revenue, how much did you spend to go and get that dollar? Those are conversations that VCs haven't had in a decade. Usually, it's always like, "What is your growth rate? That's all I care about. And great, you just tripled last year? You're getting funding," and right now, it's a lot...

Nora Ali: And both of you are in the worlds of venture capital investment and also entrepreneurship. So I guess Jeffrey, starting with you, what are you seeing and what are you looking for when it comes to growth versus profitability, when you're assessing companies to include in your portfolio?

Jeffrey Katzenberg: Well, what you're looking for is a smart balance, and I think a lot of it depends on what stage a company is at. I think growth, at all costs, was never a particularly wise path. And that's not to say there aren't companies that did pretty good following that path, but that's literally a generation ago. But we look for, first and foremost, great entrepreneurs. We look at things that have achieved product market fit, that have achieved not just revenue but have a sustainable model. But we were looking for that six months or 12 months or 18 months ago. I don't think that's really changed markedly for us. I think we were maybe a bit more conservative in growth-at-all-cost businesses that we have looked at.

But it's not to say there still aren't phenomenal, phenomenal entrepreneurs and opportunities out there. It's obviously, the most recent one was Dylan Field and Figma, which we were an investor in and watched him build that business in a really, really smart way where he's got phenomenal growth, but he's got a very smart and profitable business model that he's pursuing. It's finding that balance between the two, and there are more of those out there to be found, and there are more Dylan Fields working every day. You gotta be on the lookout for the right people and the right signals.

Nora Ali: Yeah, the right balance. And Hari, you started Jump Ventures in 2017, so focused on creating, acquiring funding, and launching innovative businesses. What's your take on the growth versus profitability story?

Hari Ravichandran: I think this has been very cyclic. I've been doing this now for almost 25 years now, and when capital is cheap, growth at all costs makes a resurgence and it's kind of done that four, five, six times in the last 25 years. And so a lot of it is just a cost of capital. I think what ends up happening is, depending on how much surplus capital there is in the system, and we've had a lot of that in the last two or three years, what you find is people move away from creating value in companies to chasing valuation. Fundamentally, I've always believed that valuations oscillate around value creation in the company, and value creation comes from building great products, building great moats in your business, building great culture, building great revenue models with great unit economics, et cetera. I think in the last few years what's happened is the amount of surplus capital, people have a little bit forgotten that part of it and looked a lot more to what will drive the valuation up.

Every time there's a divergence that way, there's always a correction sort of on the backend, which is what we're seeing now. I think in a way it's a good thing, because what it ends up doing is culling the wheat a little bit. That makes it sort of easier for companies that have been diligent and focused on fundamental value creation in their business, taking care of their customers, and building great products to rise up. That's what we saw after the dotcom bust. We saw that in '07 and '08. Even companies like Wayfair, for example, which is a Boston-based, company. I mean they came out of the aftermath of a crisis and built a greater phenomenal business that scaled up quite a bit. So I think in the next few years, you'll see who has sort of stuck to the underpinning of good business-building, and who has been sort of chasing valuations. And that I feel is what's happening now.

Nora Ali: It's certainly clear that cybersecurity, at least, is going to continue to be lucrative for the foreseeable future. Crunchbase had reported that cybersecurity venture funding surpassed $20 billion in 2021. So Hari, will the technology for hacker prevention ever catch up to the sophistication of hackers? Will we ever live in a hack-free world, or are there just going to have to be more and more companies that innovate on top of it?

Hari Ravichandran: I don't think you'll ever get to a place where you're always safe, it's just too dispersed a problem, and it's too many sort of players in the system, including customers, consumers, enterprises, et cetera. But I think what is interesting about the most recent trend, and as we're kind of thinking about these products and adding things to our own sort of roster, is the amount of sophistication that we have now with data systems, with learning systems, et cetera. If you're able to aggregate those, you are able to catch these things a lot more quickly. If you're able to decipher the signals, you might even be able to prevent a lot of them.

I think the gap does feel like it's converging as technology gets better and a lot more people are focused on it. We see that a lot for enterprises, because that $20 billion number that you were talking about, a predominant portion of that went to funding enterprise security. On the consumer side, there's still a huge gap. I mean there's just not a lot of VCs that play in the consumer segment. It's sort of a more difficult market to crack for the reason you mentioned earlier, Nora, which is getting awareness. So there's still a big gap there, but in general, I do think that we're converging, but my view is that it will forever be a cat and mouse thing, because you get smart, the criminals get smart, and so you're always catching up a little bit.

Nora Ali: Criminals are very smart these days.

Hari Ravichandran: They are. They are that, for sure.

Nora Ali: We're going to take another very quick break. More when we come back.

I want to get to a little bit of career advice from both of you before we get into our fun segments and some games, and then we'll wrap things up. Jeffrey, you had said to Morning Brew earlier this year, at the time that you had sold DreamWorks to NBCUniversal, if you were 20 years old at the time, that was six years ago when the company was sold, you said you would be in digital technology, that would've been your career choice. Does that still stand true? If you were a 20-year-old today, what industry do you think would be the smartest industry to get into?

Jeffrey Katzenberg: More so today than even then, six years ago. Today, I think if you have dreams and ambition to build a great product or company to impact the world, to find fame and fortune, it is in some version of Silicon Valley. Six years ago it was Silicon Valley. Now, Silicon Valley is replicating itself in other parts of the world, so there are global places to be able to do that. But digital technology today is where I think the most exciting career opportunities are if you are entrepreneurial. Whatever I felt five or six years ago, I feel even more confident that that's where the greatest opportunities are today. When I started out in the 1970s, you went to Hollywood, and that's where you could find fame and fortune. And I did. But I don't feel like that same opportunity exists today. Certainly not to the same degree.

Nora Ali: Any career regrets, Jeffrey? Would you have done it differently?

Jeffrey Katzenberg: No, honestly. Ah, I wish I'd gotten fired a little less publicly, a little less ugly. But no, every chapter has given me something great. And I would say the greatest thing for me, Nora, from a career standpoint, including in this moment right now today, I have always been blessed by the fact that what's in front of me has always been so much more interesting and engaging and fulfilling than what's behind me. I know how lucky I am to be able to say that. What I'm doing today, I actually love more than what I was doing yesterday or last year or five years ago or even 10 years ago. I understand when I say that to you how significant that is, because I've had great chapters before.

Nora Ali: Are you saying cybersecurity is more fun than Hollywood, Jeffrey?

Jeffrey Katzenberg: Digital technology is, right now. I'm having as much or more fun at this today than I was in the golden era of the eighties and nineties in Hollywood. Absolutely.

Nora Ali: Wow. Good to know. Hari, any career regrets for you? I mean you've been in digital tech the whole time, so anything you would've done differently?

Jeffrey Katzenberg: He wanted to go to Hollywood, but he never went.

Nora Ali: You could have been a star, Hari.

Hari Ravichandran: Exactly right. I kind of look at it in pockets within my career. I've been an entrepreneur since I was 20. I'm in my mid-forties now. Along the way, some of the things I wish I had known, if I could have owned more equity at the business that I've kind of created over time, which means waiting a little longer to raise capital, being a little bit more diligent about sort of outsiding capital raises. That's certainly one thing. I think it kind of boils down to when you're younger, it's always a little scarier to make a complete and outsize bet on yourself. I have never met a successful entrepreneur that's ever said, "I wish I'd owned less of my own company." Everybody wants to own more of it.

And the reason you take capital is because you don't want to wait. Sometimes some businesses need it, but many a times, it's because it helps you manage risk a little better, in your own mind anyway. So if I could go back and do it again, I would bet on myself fully and all the way, versus perhaps partially like I've done a few times in my career.

Nora Ali: Well, Jeffrey, on the topic of regrets, I do have to ask about Quibi, which failed due to a bunch of bad circumstances in 2020, the short-form streaming platform. So for me, if I have a bad meeting or a bad interview or something suboptimal happens that I feel is a failure, I will ruminate on it. I will lose sleep over it. I know that is the case for a lot of my peers. How do you, then, Jeffrey, bounce back? For some failure that is as public as Quibi, how do you bounce back and keep going in the face of that kind of failure?

Jeffrey Katzenberg: But I think that's what entrepreneurs do. By the way, just to give you how different Hollywood and let's call it Silicon Valley, again, the ecosystem, how different they are from one another. In Hollywood, when you make something and it fails, a movie, a TV show, an animated film, a Broadway show, whether you are behind the camera or in front of the camera and those things don't work. It's not just that they don't work. They are humiliating. Other words, the ecosystem around it, the whole media world around it amplifies that failure, magnifies that failure, and makes you feel that failure in a very public and painful way. It's a very harsh part of Hollywood. And Silicon Valley is actually quite the opposite. They say, "You tried, you took a shot, you did something that no one had done before." 

And there's a very simple equation that I always think of. If you want to do something that is unique and original, that equals risky. If you take risk, that means sometimes you will fail. If you take the right to fail away from yourself or from others, they will not take risk. And if they don't take risk, they won't do unique and original. And look at Hollywood today. Very, very, very small percentage of things are now unique and original. They're all franchises, they're all known IP, they're all derivatives of it, so you have a very different ecosystem today. Whereas in Silicon Valley, there's that understanding that even for Quibi, which was a crazy-ass moonshot, I mean think about how audacious that was, how ambitious it was, how pioneering it was, and how risky it was. We all knew it, our investors knew it. But that didn't stop us from having the enthusiasm and the ambition and the creativity and the drive and the passion to try it.

I will say to you, and I said this over again and I will always say it, the failure of Quibi humbled me. It did not humiliate me. I'm not sure why that is the case. Maybe it's because I'm so proud of the work that others did, the artists and filmmakers and storytellers who came in and said, "Oh, we're going to try something completely new. We're going to make these high-end, high-quality content and chapters." And they did it and it was actually really great. I was proud of the content that they made. The fact that we didn't have product market fit and why...I don't blame it on anybody or anything. Or people say, "Well, do you think it was Covid?" I don't know. It was certainly part of it, but I can't say that's the only reason that it didn't work. It didn't work.

And to me, the thing I'm most proud of in its failure is that when it was clear to us it wasn't working, we gave $600 million back to our investors. Now, we still lost hundreds and hundreds of millions of dollars. But the fact that once it was clear it wasn't going to work, we shut it down as quickly as we could, as efficiently as we could, and gave money back to the people that took a risk on us.

Nora Ali: I love that you called Quibi a crazy-ass moonshot, because our next segment is called Shoot Your Shot. I think we're gonna have to rename it. It is called Shoot Your Shot. Starting with Hari, I would love to know, what is your moonshot idea? This is your biggest ambition, your wildest dream. It could be personal or professional.

Hari Ravichandran: I think for me professionally, I feel like there's a lot of convergence now that's happening on the technology side, the health side. I see, I meet a lot of entrepreneurs, I meet a lot of folks. In general, underneath all of it, there is this notion where people still have a general sense of anxiety. Like the level of mental anxiety, the level of physical anxiety, all of that has gone up quite a bit. So one of the concepts that we've been kind of ruminating in the back of mind, I mean someday, if we ever have an opportunity to build it, is whether you can kind of converge data, you know, gut health, and genetic information into something that's very personalized, customized, to get people to a level of a baseline happiness where they can kind of build up from there and have it be very personalized.

I think it's very difficult. It's a lot of mixed pieces that need to come together, but it's something that we've been kind of noodling on for a bit now. And actually with Jeffrey's partner, Sujay, we've been talking about that off and on, but something like that where you can, for the masses, customize by using technology to drive a very basic human necessity, which is a sense of happiness and a sense of feeling good about yourself in a scientific way. That's the idea. Maybe we'll get to it someday.

Nora Ali: I'm in. Jeffrey, quickly, what is your moonshot?

Jeffrey Katzenberg: He's actually touched on one—let's call that health wellness as a sort of macro idea. The other one that I feel equally ambitious about is what I would call financial wellness. For the average person today, I think quality of life would be measurably better if there was an enterprise that actually helped them manage the day-to-day finances of their life, and a place where reliably and dependably, they could actually get professional advice for decisions, "Do I rent a home? Do I buy a home? Do I lease a car? Do I buy a car? Do I retire my student loan? Do I extend?" Like these are macro decisions that people have to make every day that have enormous impact on the quality of their life. I think I'm lucky enough, I have access to advisors and very smart people who can actually help me have financial wellness. Most people do not. And I'd like to see that available to everybody. I think that would be a great thing that would improve society. Working people, everybody, I think, would benefit from financial wellness.

Nora Ali: Final, final thing. It is now time to play This or That: Hollywood Tech Edition. We're combining two of your worlds, Hollywood and technology. I'm going to list out pairs of cool futuristic technologies that have famously appeared in television and film. And you have to choose which one you wish was real. Very easy. Since we've been on the topic of crime, this or that: crime prediction technology from Minority Report, or being able to download physical and mental skills into your body and brain, like martial arts, via a computer, like in The Matrix. What do you guys wish was actually real?

Hari Ravichandran: I mean, I have to go with Minority Report, because we actually describe our company internally that way, which is we're the minority report for cyber crime, so it's an easy one.

Nora Ali: Perfect. Dope. Jeffrey, what do you think?

Jeffrey Katzenberg: Let me be really clear. Minority Report was made by my partner Mr. Spielberg; that's a non-choice choice.

Nora Ali: I try to make the first one easy. Great. So we pick Minority Report. Number two. Now it's time to mess with the space-time continuum.

Jeffrey Katzenberg: All right, here comes the Star Trek question.

Nora Ali: How did you know? This or that? Time travel from Back to the Future or, of course, teleportation from Star Trek.

Jeffrey Katzenberg: Well, you do know that the very first movie as a little puppy executive in the movie business that I actually shepherded was the first Star Trek film. So there's my answer for you.

Nora Ali: Boom.

Jeffrey Katzenberg: I was a Trekkie.

Nora Ali: Amazing. I'm a Trekkie, too.

Jeffrey Katzenberg: Beam me up, Scotty.

Nora Ali: Yes. Hari?

Hari Ravichandran: Live long and prosper. I gotta go with the Trekkies.

Nora Ali: Perfect. So we'd rather be able to travel anywhere instantaneously than be able to go back in time. I agree. Lastly, technology that gives you superpowers. This or that: an Iron Man suit, so you can fly, fight, have a computer interface, and talk to Jarvis all the time. Or an Ant Man suit, so you can shrink and expand whenever you so please. What do you pick?

Hari Ravichandran: RDJ. Gotta go with...

Jeffrey Katzenberg: That's us. We're Downey boys.

Hari Ravichandran: RDJ all the way.

Nora Ali: Iron Man all day.

Jeffrey Katzenberg: Downey boys.

Nora Ali: You are a Downey boy.

Speaker 11: Take that off, what are you?

Iron Man: Genius, billionaire, playboy, philanthropist.

Nora Ali: I mean, you have to pick Robert Downey Jr. Honestly, I love Ant Man, it's my favorite Marvel film, so I'm going to have to disagree on this one and go with an Ant Man suit. I am probably alone in this.

Jeffrey Katzenberg: Let me just say, there is no bad Marvel film, so you can't lose on that.

Nora Ali: Yes. Amazing. Well, that was fun. We're going to wrap things up. This was a great conversation. Hari, Jeffrey, thank you so much.

Hari Ravichandran: Thank you, Nora.

Jeffrey Katzenberg: Thanks, Nora. Take care.

Nora Ali: This is Business Casual and I'm Nora Ali. You can follow me on Twitter @NoraKAli, and I would love to hear from you. If you have ideas for episodes, comments, and thoughts and episodes you loved, fun segment ideas, just shoot me a DM and I will do my very best to respond. You could also reach the BC team by emailing businesscasual@morningbrew.com, or give us a call. That number is 862-295-1135. And if you haven't already, be sure to subscribe to Business Casual on Spotify, Apple Podcasts, or wherever you listen. And if you like the show, please, please, please leave us a rating and a review. It really, really helps us. And guess what? We are on YouTube. So if you've ever wondered what I look like or what our guests look like, full episodes are available at youtube.com/morningbrewdaily. Business Casual is produced by Katherine Milsop and Olivia Meade. Additional production, sound design, and mixing by Daniel Marcus. Kate Brandt is our fact checker. And AB Silver is our senior booking producer. Sarah Singer is our VP of multimedia. Music in this episode from Daniel Markus and The Mysterious Breakmaster Cylinder. Thanks for listening to Business Casual. I'm Nora Ali. Keep it business, and keep it casual.