A Venture-Capital Perspective On Today’s Most Visionary Thinke
When Angela Merkel, Mark Zuckerberg or members of the World Economic Forum want to understand how the technology of the present is shaping the future, they consult Yuval Noah Harari. Harari’s influence is deserved: An Oxford-educated historian based in his (and my) native Israel, his books integrate history, philosophy, theology, neuroscience, ethology, computer science, film criticism and meditation.
Harari is a thoughtful generalist who makes insightful connections between disparate subjects. Part pop science, part history, part self-help, Harari’s books are more like subway maps than GPS directions: They schematically chart some intellectual territory without following a linear argument from origin to destination.
The recurrent point of Harari’s books is that biotech and artificial intelligence (AI) are converging, and humans will use these technologies to grasp for immortality and divinity ( homo deus). But if we neglect meaning in our ascent, godliness will be a hollow achievement — and perhaps even our doom.
He has a point. AI is already here, and our complacency will cost us, as I recently argued. But Harari goes further, listing nuclear war, ecological collapse and general technological overreach as other horsemen of the overdetermined apocalypse.
We Jews — especially Israeli Jews — tend to be phlegmatic about apocalypses. They’re like Bay Area earthquakes: Unpleasant, but they happen so often that you only bother telling your grandkids about the Big Ones. As a professional investor with decades of experience, I’ve seen a few market collapses after which nothing would ever be the same. Yet here we are.
Convergences Between Harari And Venture Capital
Let me share some thoughts on Harari’s eschatology and how it looks from the VC vantage point.
Like Harari, a good VC must be a generalist, able to survey developments in different fields and make sense of them. Further, he, like us, often synthesizes others’ research in addition to conducting his own. It’s a second-order activity. Like him, we base our judgments on the best data available and constantly question our assumptions.
Harari focuses on critical junctures in history — points at which small interventions can induce disproportionate changes in future trajectories — and he urges us to choose carefully to avoid catastrophic outcomes. As investors, that’s just our daily grind. With every early-stage investment, we’re trying to catapult a startup into the stratosphere and generate triple-digit rates of return. That’s what looking for potential hectacorns is all about. Our glass is just half full.
When it comes to instincts versus algorithms, Harari vacillates. On the one hand, he criticizes systems that rate feelings above rationality. But he also values meaning above all else, and human feelings and dignity are the source of all meaning. Feeling ambivalent toward, well, feelings, is something else we share. Yes, VCs need data and rationally derived criteria to evaluate it — just like trading algorithms. Investing is about ROI (a numeric property), but algorithms don’t make deals. Humans do. Deals entail relationships and feelings between people. We need to know the field and the principals in order to judge a founder’s character. Some difficult personalities have founded titans of NASDAQ, and sometimes nice guys finish last. Data is the lifeblood of algorithmic trading, but in the biggest deals, emotions rule.
Where We Part Ways
Harari also spreads plenty of general wisdom to which every VC naturally subscribes. No, the value of humility cannot be overrated. Yes, dogma is always dangerous. The mantra of “life’s complicated; deal with it” that Harari repeats every few chapters is good advice for everyone.
For all his brilliance, Harari does not see the world through a VC’s eyes. For example, he sees a new crisis and existential threat looming around every corner. It’s what we in the biz call disruption, and it’s the whole point. Harari never saw an opportunity that didn’t provoke a crisis. A good investor watches for the opportunity in any emerging crisis.
Judging by his warnings about biotech enhancements, I believe Harari would have abhorred early lasers. When lasers were invented 60 years ago, they were usually depicted as “ death rays.” Now they are common, restoring sight, playing music and revealing the mysteries of the universe. Similarly, biotech enhancements offer much promise. Rather than dystopian implants, they might also prevent or cure entire spectrums of diseases.
Harari also focuses on broad trends and great masses of people, which is necessary for his broad-brush analysis. VCs, though, need to consider individuals too. Geniuses are valuable, and their value derives from their scarcity. We don’t count haystacks; we’re searching for the sharpest needles.
And despite cautioning against conspiracy theories and post-truth, Harari sometimes falls victim to such impulses himself. Corporations are not the gods of our age. At most, they’re just the new religions: organizations full of fallible, limited people trying to sell larger-than-life stories.
What It All Means
Of course, it also follows that Silicon Valley is not the new Olympus, and VCs are not the Illuminati, contriving new dystopian religions to control the masses. We’re just people too. We’re fallible, we’re doing our best, and we have diverse origins and beliefs, just like any other profession. And investors aren’t as impatient as he says. Most of us will tell you a story of our overnight success being 15 years in the making.
Perhaps Harari’s most valuable advice for VCs is not to neglect meaning. Sure, investing is about growing wealth, making money. But that’s not all there is in life. We all have other pursuits. We take joy when our children smile, when we learn a new skill, when we get goosebumps listening to a great song. Success in business is great, but that’s all it is, and it’s not all there is.
It’s okay — even imperative — to let those other priorities inform our business decisions. Things like clean energy, decency, compassion and fighting discrimination can, should and must coexist with ROI. Harari’s books don’t tell tech VCs much we don’t already know, but they might remind us not to forget what’s really important.
Originally published by me at https://www.forbes.com.