Gurley says people elect officials based on intentions without tracking whether they create actual change.
“And I think we elect a lot of people because we like what they're saying, but no one follows up to see if they can actually create change.”
Gurley criticizes investors earning 2% annual fees on $300-400M checks without taking board seats.
“And for the listeners that may not know that 2 represents an annual management fee,”
Gurley says every VC speaking publicly is performing for future founders, creating pressure to look supportive.
“There is so much important criticality in getting in front of the right pitches that everyone wants to look like the best actor.”
Gurley links VC cheerleading behavior directly to governance failures like FTX.
“The problem is that's the exact same type of behavior that leads to the FTX situation because you take yourself out of a governance role completely because you just become the founder cheerleader.”
Gurley criticizes FTX investors for funding a company with no board and commingled businesses.
“I mean, the markets have a way of separating, very risk seeking individuals from their capital. It may not happen overnight, but it always happens eventually. Like there's no easy money.”
Gurley argues governance tokens without economic rights would be worth a small fraction of tokens with revenue capture.
“And everything from my history of studying finance and economics would say that if you declared you'd never rake the system governance token, simply the right to kind of control a group or community would be worth a fraction, a small fraction of what an economic token would be.”
Gurley says competitive dynamics have eliminated stewardship for discipline and results in venture capital.
“And I think it's led to a situation where there's not a lot of of stewardship for discipline and and results and that kind of thing.”
Gurley argues being public helps companies run better through enforced discipline and smart questioning.
“one of the things that I believe strongly that I think is less well understood is that being public actually helps the companies run better. It's an enforced discipline.”
Gurley reveals five investors including Fidelity felt all Uber constituents were at risk before taking action.
“So people typically say benchmark, but there was five investors, including Fidelity, who felt like all of the constituents at Uber were at risk, if action didn't happen sooner.”
Gurley argues excessive capital in Silicon Valley allows entrepreneurs to run without discipline or accountability.
“The the I guess the thing I would say is that, you know, the excessive amount of capital that's been available to Silicon Valley has allowed a lot of entrepreneurs to run without much discipline because if you if if you're not running out of money, you're not constantly being regraded and asked to come back to the table.”
Gurley argues excessive capital availability lets entrepreneurs run without discipline since they never get regraded.
“I guess the thing I would say is that, you know, the excessive amount of capital that's been available to Silicon Valley has allowed a lot of entrepreneurs to run without much discipline because if you if if you're not running out of money, you're not constantly being regraded”
Gurley says Uber's entire stakeholder base was at risk before leadership change.
“We reached a point where we felt like, you know, the entire company, you know, and all of its constituencies, drivers, riders, employees, shareholders, were at risk if the company continued to move in the direction it was.”