Amit, thanks so much for being here.
You have been very generous with your time with me and I'm honored for that.
Thanks for taking the time to come to this podcast today.
I think to start, if you can give us a brief introduction and then we can get into it.
Well, Rishad, thank you for the kind words.
Have the same words back to you.
It's been a pleasure getting to know you and collaborating and at some point we will do
more deals together.
But for today, I'm just excited to be here and have a conversation.
My background for those listening in, for those watching, I am a venture capitalist
in Silicon Valley.
I run a fund called Tau Ventures.
As of recording this, we have 85 million total that we're investing primarily at the seed
stage writing typically $500,000 checks.
I focus on the healthcare side.
My co-founder and partner Sanjay focuses on enterprise and everything we invest in, we
look for AI, artificial intelligence.
Companies we have invested in include Iterative Health, which is computer vision for colon
cancer.
Now it does a lot more than that.
We have companies that do machine learning for drug discovery, companies that help with
pre-auth.
In general, what we're looking for is how can AI really empower both folks in healthcare
and technology and the intersection to make a really big difference?
We have so many problems in healthcare.
I know Drishad, you're based in Canada, but I'm going to pick on the US here.
In the US, we spent just over 18% of our GDP in healthcare.
We have worse outcomes than countries that are comparable to the US.
We honestly have created a very tragic situation in the US where we have both the best treatments
and the best doctors in the world, but the costs are just out of hand.
The weights are out of hand.
There's a lot to be done.
I think technology is in many ways a very powerful tool.
It's not the only tool to make a difference.
Before all of this, I co-founded a startup called Health IQ.
Publicly, you'll see that the company raised $140 million.
Before that, I worked at a couple of other VC funds, started my career at Google.
This was pre-IPO days at Google, and I guess I'm dating myself.
I was a product manager there, learned a whole bunch and very grateful for my experience
there.
My training is in computer science and biology.
My master's is at the intersection of those two.
Then I also went to business school.
I'm trying to bring all of this, my life experiences, having worked in a big company, having started
companies, having worked at VC funds, and trying to bring it all together here at Tau
Ventures so that we can truly, truly help our entrepreneurs succeed, make an impact,
and make money.
I believe in the intersection of all of those.
Perfect.
Thanks for that introduction.
I told Sametra when I was talking to him that you're going to have more than a billion under
management in five years.
Wow, you are very kind.
I don't think we will, to be honest.
Not trying to be falsely modest here, but raising funds takes time and you can't run
before you walk.
I don't think it's even the right thing for us to get to a billion within five years.
I think more likely we'll raise another fund and then another fund every two or three years.
That's the norm.
You roughly maybe double in size.
There's exceptions and there's reasons to do something different.
If you follow the trajectory here, that is the biggest expectation, we will grow in size
for sure.
I always want to be an early stage fund.
At least that's what we're thinking right now that our differentiator is in how we help
entrepreneurs build companies at the late stage.
It's a lot more about financial modeling and there's a lot of value in that too for sure,
but it's not what we are focused on.
It's also much easier to do a 10x on a $500 million fund than on a $5 billion fund.
There's practical reasons to also keep your size within a certain range.
Let's talk about when you're thinking of allocating this $85 million, how do you manage risk and
reward?
Are you looking for say a 10x return on every single deal you put into?
Are you okay with maybe a 1000x return, but a 5% chance of that on some deals?
How are you thinking about that risk reward to eventually return back, as you said, 10x
on the whole $85 million?
10x by the way is very ambitious.
It says 10x, but if you look at the data, overwhelmingly good funds do 3x and exceptionally
good fund does 5x or higher.
So there is a long tail of distributions for sure, but what we were hoping is 3x at least
and 5x ambitiously.
Anything over that I'll be extremely, extremely happy about.
I can share today our fund is at 2.5x in just over two years.
That's the first fund.
So we seem to be on track.
Now the law of small numbers helps me.
As I was talking earlier, if you have a smaller fund, it's easier to actually get outsized
returns.
You have more flexibility when you buy and sell.
You're also hungry and you also need to get a few exits in order for the needle to really
move.
So for all those three reasons, having a manageable fund size is a good thing.
So when we look at deals, that's partly what we look at also.
We're investing primarily at the seed stage and specifically late seed.
So we're looking for companies that are a little bit more than two people in a garage.
They typically have a pipeline of customers.
That's the key thing to look for.
If you have pilots, wonderful.
If you have pay pilots, even better.
So if you're making money, revenue is amazing, but that's not our expectation.
Our expectation is that you have a roster of potential clients and that you're able
to close on them and get to recurring contracts and eventually to a Series A within nine to
18 months.
A Series A is when you have product market fit here in the US at least.
A million ARR is kind of what people look for.
So we'll look for, can this company get there?
And can we really help them get there?
And can this company have an explosive growth?
So what you want is not just a company that has good revenues and good profitability,
but in what time horizon it does that.
If a company is raising a seed and they have been around for 10 years, it's not a good
fit for me.
They may be a very good company, but it's not what I'm looking for.
I'm looking for perhaps a Silicon Valley mold of companies where you're raising every couple
of years.
You are ideally doubling every year in terms of your revenues or very soon in your ARR,
annual recurring revenue.
But we don't expect every company to hit 10X, obviously.
If every company hit 10X, then there would be no need for venture capitalists, I should
say.
But we look for the odds that a company could get there.
So in our portfolio construction, we do hope and expect, and so far are seeing this, that
about 10% of the companies will actually do 10X or better.
And then maybe 50% or 60% will do somewhere between three or four X and five and six X.
Some companies may do one or two X, and you may have some companies that lose money.
It's possible.
And in our portfolio construction, we said maybe 10% of the companies will actually end
up making less.
I'm happy to say that so far we have way over indexed on the successes.
And once again, that's in some ways a function of having a small fund and having the flexibility,
how we play Parada, when we play Parada, how we help other portfolio companies in terms
of getting customer traction and in terms of getting investor traction and then helping
them with exits.
I'm very proud to say this.
We have had four exits so far, and the first fund is just about two years old, just over
two years old.
Congratulations.
That is impressive.
I was reading some statistics on AngelList, and the average time to exit after VC money
was 5.6 years.
So you guys are doing better than half that.
So it depends.
First of all, the 5.6, I wasn't familiar with that figure, I've heard higher figures than
that.
Different industries have different time horizons.
When you invest also has a different time horizon.
Like if you're investing at a series C, well, you're probably looking more like a three
or four X and probably within three or four years rather than a 10X in 10 years when you
invest at the seed stage, right?
It's risk reward based on time.
But a couple of things that have been beneficial to us is we have had M&As and whatever comes
out of companies that got acquired actually the acquirement IPO, and we have stock in
the acquire also.
But the other instrument that we have besides IPO and M&A is to do secondaries.
So I'm open to selling my shares to somebody else, and I'm open to buying shares from somebody
else.
I've actually bought a lot more so far than I've sold.
I've actually bought four or five times more so far from angel investors, from other VC
investors, and I'm open to selling to somebody else.
I have only done it once so far, but in the near future, I'll do more of it.
And that's what's called a secondary.
So the advantage of a secondary is that you can recognize exits a little bit earlier and
return money to your LPs, your own investors a little bit earlier.
Now how and when you do that, there's art and science to it.
And how much you sell is also obviously there's a lot of art and science to it.
So inherently, I would think if your company is doing well, you would want to buy as much
as you can.
When?
Not necessarily.
We are big believers in supporting our companies.
But mind you, we are at the moment 85 AUM.
So if my company is already worth a billion, even if I put in 2 million, 3 million, which
for me is a big check right now, it doesn't move the needle that much.
It's not the kind of capital that that company is looking for.
And it may also not be the amount of risk reward that I want.
So when I decide to play my prorata, and a prorata is just a fancy word that means investing
enough to maintain your ownership in the next round, we like doing that.
But sometimes we don't, even if the company is doing well, because there's enough interest
around the table and we want to make sure really good investors come in.
Or because the company is already valued so highly that the opportunity cost for me is
too high.
I may say, look, I could put more money here, but I could also put it in a company that's
worth one-tenth the valuation where I may have a higher risk reward.
So there's many motivations and many things you have to consider, not just when you make
the investment, but when you do follow-ups.
That makes sense.
Amit, you've had a window into healthcare in various different countries.
You grew up in Brazil, you've invested in India, and obviously North America as well.
The question I want to ask is, there's a theory that I've been playing around with that primary
care and first access to healthcare is where profits should lie, and acute care, chronic
care to an extent, and cancer care likely should not be where profits should lie to
build the best model of healthcare.
I think we still haven't figured out healthcare in terms of pricing and reimbursement anywhere.
How do you look at if you were to design your health system, would it be profitable or not,
and where would most of the profits be derived from if so?
Yeah, no, that's a very simple and very hard question.
Healthcare has obviously a moral component to it.
I think many people, perhaps you included, Rishad, you're a doctor, would agree that
you have to provide some kind of baseline of care for everyone.
I certainly believe in that.
But at the same time, I do see the benefits of having a profit motive because that ensures
accountability, that ensures innovation, that ensures alignment of interests in many ways.
Can also do misalignment of interests.
I am a capitalist.
I mean, venture capitalist has two words, and I did go to business school.
I do believe actually that if you do capitalism in the right way, it is the single most powerful
way of impacting our societies, creating jobs.
I do think there's a way to do that in medicine.
It's not easy.
If I were to design a healthcare system from scratch, first of all, I would surround myself
with a lot of good people because I don't know everything.
I don't know enough.
Healthcare is too big for any one person to try to design by themselves.
What I would try to do is align the incentives as much as possible.
There are companies out there, med device companies, pharma companies, where you need
to provide a profit motive.
Absolutely.
Otherwise, there will not be innovation.
There will not be discoveries.
There is a part of healthcare where you're providing care to perhaps disadvantaged populations,
people who are below the poverty line, where it doesn't make sense to necessarily charge
them money.
Perhaps what you do is you create tiers.
Different countries have tried doing that, including here in the US, or Brazil, or India,
or Canada, or UK.
I think that the answer is you have to have a public system that is good, that attracts
the best talent, that does pay well, that does serve everyone, and that perhaps is managed
at a national level.
I know there's pluses and minuses to this, but I do think there's no way around it.
At the same time, you have to have a good private system because there's other things
in healthcare that absolutely need a good private system.
I think you have to attack from both fronts.
If I look at the countries or the states that have done this the best, it's usually a combination.
This requires far more than just policymakers.
It actually requires what I call all the P's, the letter P, in healthcare.
It requires providers, it requires payers, it requires patients, it requires policymakers
or politicians, it requires pharma.
There's other P's out there, but those are the five big ones.
I think that you have to create a regulatory framework that allows people to actually make
the right choices.
If you create frameworks where the interests are misaligned, no matter how good people
are, they will take decisions that are suboptimal.
This is something I've been thinking about in value-based care, is the incentives are
often aligned to outcomes, which actually creates perverse processes to obtain those
outcomes.
A way better example, if you incentivize a strict BMI, people will starve themselves.
You should incentivize the process or the structures in place instead.
What are your thoughts on value-based care and how to best incentivize the right processes
so the outcomes are achieved that we desire?
You said it better than me, Rishad.
If you pick just one variable and you optimize around that variable, it doesn't necessarily
capture everything.
You could optimize on price, you could optimize on outcomes, you could optimize on the amount
of time for you to get seen quickly.
You could optimize on any one variable and you will not actually optimize for everyone
in every single situation.
That's the problem in healthcare, honestly.
The answer is you can't optimize just on one variable.
I think for better or for worse, outcomes is the least worst metric that I can think
of, but it's not perfect.
You have to temper it exactly as you said by looking at process.
Let me create another situation here.
Doctors that deal, and not just doctors, healthcare providers really, doctors, nurses, physician
assistants, everyone who's involved in the care of a patient that deal with complicated
cases are going to have worse outcomes, very presumably, than doctors who are focused on
easier cases as a percentage.
Doctors who are perceived, and this one I will pick on doctors, who are perceived as nice,
bedside manners, get rated higher even if they're not necessarily the best doctors.
The best doctors may actually be a little bit rough on the edges and they may have patients
do things that the patients don't like.
It creates for a little bit of friction.
If you optimize just on patient satisfaction, it's not correct.
If you just optimize on outcome, it's not correct.
If you optimize on keeping costs low, it's not correct.
Unfortunately, you have to pick one of them and focus on it, but not lose sight of everything
else.
I think that's why you need to look at patients holistically and also at healthcare systems
holistically.
I'm fully in favor of healthcare administrators being much more proficient about the challenge
they're dealing with, for providers to be much more proficient about the administrative
challenges, for patients to be very engaged in their own care, for pharma companies to
change their business models, improve their business models, which are honestly a stretch
very crazy right now, like $10 billion or $1 billion to develop a drug.
That's crazy.
What we need is to really listen into each other.
I know this sounds a little bit cliche, but it is really true to listen into each other
to see things from each other's perspective.
I think if there was one variable, one other P I would focus on, you said process and I
would say perspective.
If you could go back in time to yourself 10 years ago, 20 years ago, what is one piece
of advice you would give yourself?
Oh boy, only one?
As many as you want, Amit.
I think this gets a little philosophical, but what you think now and what ends up happening
10 years later are invariably very different things.
Practically every plan I have made in my life didn't work out or didn't work out the way
I thought it would, but having the plan was very important.
If you'd asked me 10 years ago, I could have never predicted that I would be sitting today
running Tao Ventures, doing early stage investments.
However, if you had asked me what I would like to do in terms of principles, those principles
to stay very same.
I hear this from a lot of people that my principles have stayed constant.
Obviously you evolve over time, but the principle is what you're grounded on.
I've always wanted to make an impact, do good, do well.
I've always believed more specifically that the intersection of life sciences and technology
is something that I can make a disproportionate impact.
In my engineering mindset and my life sciences mindset, I could bring both those two and
provide the best treatments for everyone.
Make a lot of money in the process.
I don't think those are mutually exclusive, by the way.
I don't think that you have to choose between making money and doing good.
There are ways in which you can actually do both.
That principle has stayed constant for me.
If I were to remind myself 10 years ago, it would be everything you're thinking right
now specifically will probably not work like you're thinking.
But the underlying motivations, make sure you keep holding onto those.
I agree with that.
I would add money is status and status brings the power to affect change.
Take me back to when you were a child, when you were five years old, 10 years old.
What did you want to become at that point?
To make an assumption there was, some people would argue is the mindset of a child.
But jokes aside, as far as I can remember, I wanted to do something in healthcare.
This is for many reasons.
I did grow up in a smaller city in Brazil.
I did my high school in a larger city.
I've spent some time in India, which is where my roots are.
When you grow up in emerging countries, you do see lots of social problems.
You see both the best and the worst of humanity in some ways.
I wanted to try fixing some problems.
Growing up, I do remember very specifically people not having access to education and
healthcare.
My parents came from education and they're professors.
I always thought maybe something along those lines or something along the lines of healthcare.
I would gravitate more towards healthcare because I felt that if you don't have good health,
then you can't do anything in life really.
Healthcare is really a foundation of who you are.
If you're not healthy yourself, you can't afford even to go to school in some ways.
It's truly, truly foundational for you as an individual, for a family, and for society
in general.
I'm pretty sure my parents would have said that I wanted to be a doctor.
I'm sure I entertained being an astronaut or being a jet pilot fighter, but those were
whims.
They were not real plans.
I think I truly wanted to be a doctor.
As I grew older, I actually applied to be a doctor.
I got into med school, but I decided not to.
It wasn't a change in goals in some ways because my ultimate goal wasn't to be a doctor.
My ultimate goal was to make an impact.
My ultimate goal was to fix problems.
My ultimate goal was to create a better life for myself and for other people.
I don't want to come across here as not being self-interested.
I'm very self-interested.
I do want to make money.
I do want to live comfortably.
I do want to have the words you mentioned, power and status, but I don't want those necessarily
at the exclusion of being able to make an impact.
In fact, if anything, I want to use both in service of each other.
In my mind, at least those things are aligned.
My ultimate motivation behind it, that has stayed constant as far as I can remember.
Okay, perfect.
Thanks for sharing that, Amit.
The next question I want to ask is, building on Bill Gross's idea lab study of why now
is the best predictor of success in a startup, one could argue tailwinds drive a considerable
amount of success, COVID, regulatory changes, wars to an extent.
A tailwind I'm banking on is hybrid at-home care, really growing over the next five years,
including hospital care at home.
What are some tailwinds you're banking on right now?
I'm going to ask you to predict the future.
What are some tailwinds you think will emerge in the next five to 10 years?
Sure.
I'm going to invest in a company called Irritative Health, which I know you're familiar with
also, Rishad.
It was very coincidentally the very first investment we did through the fund, officially.
They've done phenomenally well.
They've raised more than $200 million, and this is all public in just over two years.
What the company had started off with was training their algorithm to detect cancer
using computer vision.
More specifically, taking video feeds of a colonoscopy and in real time, being able to
detect if there was a polyp that was cancerous, and helping physicians, specialists, especially
gastroenterologists, be able to detect colon cancer earlier, quicker, and better.
If you don't detect it early enough, cancer is, unfortunately, all of us have been touched
by it in some way or shape or form, and I think all of us will resonate with this, that
it can mean the difference between making it or not making it.
Detect early, you save a patient's life.
You detect it too late, maybe you can't do anything about it.
Where I'm going with this is we betted on a company that was able to take massive amounts
of data and make sense of it very quickly, and that would not have been possible even
a few years back.
I dare say even three or four years back, because now we have a lot more computational
power.
We have a lot more data.
We have a lot more understanding of how to analyze this data.
We have algorithms that have been built by others.
We have tech stacks that you can leverage from, and I'm giving the example of iterative
health, but that's symptomatic of most of our portfolio.
We have found really good folks.
Sometimes they're doctors, sometimes they're technologists.
More often than not, there are partnerships between these people who are able to take
cutting edge tools and apply it to solve these problems.
I'll give you another example.
We have a company called Signos, which repurposed a hardware device, a continuous glucose monitor,
that is typically used for you to track and hopefully avoid a glucose shortage.
It's affiliated with an insulin pump and diabetics use it, but they have repurposed it for obesity.
You can see what's going on inside your body in real time.
You eat, drink, or exercise and help you take better decisions.
If you can measure it, you can monitor it, and if you can monitor it, you can modify
it, your behaviors.
Once again, if you think about it, we bet it on a company that has done really well
so far and we continue very much believing in it, that can take massive amounts of data
and try to make sense of it.
No single human being could have made sense of all of this until recently.
You do need machines.
I am a firm believer that machines are not here to replace us.
They're here to help us, to augment what we can do as physicians, as nurses, as investors,
as a society.
It will create jobs.
It will destroy jobs.
Overall, what technology has done throughout human history is make us more efficient, is
able to do things that we couldn't do as well at all.
I do believe that AI done in a smart way can make our societies incredibly better.
It can lead us, the whole gospel of prosperity, it can lead us to a brighter future.
The key is to do it well.
If you do it in the wrong ways, we can create a lot of imbalances in society.
That is going on to your second question.
What I do expect in the next 10 years, I expect more of this.
I expect a lot more of this.
I expect AI to really make a transformational change in how we develop drugs, how we discover
drugs.
The amount of molecules that we know today is a fraction of all the possible molecules
that can exist in the universe.
I've heard the figure 0.01%, by the way.
That's the amount of molecules that we know today of all the possibilities out there.
I'm hinting here at a revolution in biotech, which I would love to do more of.
I'm not there yet.
We invest in digital health, but in the near future, I do expect biotech to be as fast
in terms of development with CRISPR and CAR-T and with AI and with all of these new technologies
that are emerging to become more similar to how tech is done today.
Digital health is already there, by the way.
Digital health, two people in a garage can now build digital health companies the same
way that Google and Apple were created.
So digital health already operates very much like tech, and I expect another industry to
start operating in the next 10 years.
With biotech in particular, the time to exit on average from what I remember is over eight
to 10 years.
A lot of that is because of the trials that need to happen in the stepwise fashion waiting
for results to come.
Do you think that process will be expedited through AI as well?
Absolutely.
I have a PhD in biochemistry, so I'm remiss in saying that, but I am operating at the
intersection of AI and life sciences, and that's what I've built my career for the last
20 plus years.
I firmly believe that what in silico allows us to speed things up, not by one or two X,
by 10, 100 X.
Think about being able to simulate molecules, to be able to simulate protein-protein bonds,
to be able to simulate how drug-to-drug interactions would be, to be able to simulate how a particular
drug would behave in your body.
Ultimately, you will still need human clinical trials.
Absolutely.
Animal trials.
Absolutely.
But you'll be able to hone in instead of looking at a search space that is the entire universe.
You'll be able to hone in, and these are the things we need to test.
This is how we need to test.
These are the things you have discovered that are not issues, and these are potential things
we need to go deeper in.
Okay.
Yeah.
I think what AI will allow us to do, and is allowing us to do, is to be able to focus
a lot better.
We do have some portfolio companies doing this already.
We have one called ArpeggioBio that's focused on mRNA and helping develop more around mRNA
as a platform.
RNA in general, I should say.
We have another one called Teco.Bio that is focused on how do drugs interact with your
blood and with cancer in general.
How do you make sense of all of that?
Because the blood is actually the way your entire body really transports substances to
each other.
Ultimately, it's the blood for the vast majority of things.
How you deliver drugs to the right place and how they interact with each other is absolutely
crucial for how we make sense of cancer.
Yeah.
I think targeted chemo, especially immunotherapy, has just made such big advancements over the
past two decades.
I don't want to get too deep into this because a good chunk of our listeners are not physicians.
I think there's a comfort with AI replacing analytical tasks, but there is a discomfort
with AI replacing creative tasks, especially with Dali and what it's doing in the art world.
We seem to protect the artistic side of humanity from AI, and we seem to want to say what makes
us human is our creative endeavors.
What are your thoughts if AI can be more creative than us, if AI can be more human than humans?
Should AI replace creative tasks?
Art music are probably easier to answer than being a counselor, being a friend, or even
being a parent.
If AI can do it better than us, should we let it?
Once again, very simple and very hard question.
You talk to different folks, they'll have different opinions, and these are folks who
are experts.
You talk to people who have spent their entire lives with AI, and they'll give you different
answers around this.
There's very famous Canadians, or people based in Canada, I should say, Jeffrey Hinton and
Yasha Bengio, and some of the foremost names in AI are actually based in Canada or working
out of Canada.
But I fall under the school of thought that general AI is really, really far.
It's not going to happen in my lifetime.
An intelligence that is more human than human is very far.
An intelligence that is better than humans in specific tasks, that's already here, and
that's going to expand.
But think about how AI in general learns today.
By and large, it's because we throw a lot of data, and we do reinforcement learning,
supervised learning.
There is such a thing called unsupervised learning, but by and large, the inherent intelligence
of the fastest, strongest, biggest computer in the world, which you could argue is the
internet itself, is not bigger than an invertebrate, than a worm.
There are tasks that human babies learn by themselves or by watching that computers can't
do.
Fundamentally, how human brains are structured and learn is very different from how computers
are structured.
It doesn't mean that we need to build computers like humans, by the way.
It leads to a whole philosophical question of what is intelligence, how do you define
it, and can intelligence be replicated in different ways?
I fall under the school of thought that there's not a single path towards intelligence.
Going to your question really more specifically, look, we've been going through revolutions
for thousands of years at this point.
We started off thinking that the Earth was the center of the universe, and then we realized,
no, the Earth orbits a star.
We thought that that star was the center of the universe.
Then we said, no, no, that star is just one in a galaxy.
Then we said that galaxy is the only thing in the universe.
Now we know that galaxy is one of thousands, millions, trillions in the universe.
We have gone from an anthropocentric view of the world to a heliocentric view of the
world to a perhaps a pantheistic centric view of the world.
Why not?
Why can't we also accept that things that we create, AI is a creation of human beings,
can actually create things that we can't?
We already do automation in factories, and those factories will do productions at a higher
quality and at higher speed than we do.
Think about cars.
We invented cars, and then we used machines to perfect those cars.
We built machines that built machines that built the machines that built the cars.
We have created layers upon layers upon layers upon layers.
I'm not personally afraid of AI diminishing my humanity if AI can do something better.
I don't celebrate that.
We created AI, and AI can do things that I couldn't even dream of.
What I think needs to happen is for us not to lose purpose.
I think that's a different question.
If humans lose their purpose as individuals and as a society and as a civilization, then
yes, then they're screwed.
There is a danger then in recognizing that things that we create are better than us in
so many different ways that we start losing purpose, but it doesn't need to be that way.
I'm totally okay with AI doing things better than me.
Sure, I just don't need to lose sight of purpose in that conversation.
I'm a big fan of you, man.
I wish more people thought like that.
There's a lot of fear in this space.
You said something very interesting that I want to pick at more, that we don't need to
build computers like humans.
As per my understanding of the current regulatory space, there's still a need for us to understand
what the AI is doing.
And I'm not a computer engineer, but there needs to be some transparency over the neural
networks or whatever the learning process is.
At what point do we let go of that need for control and say, if there is correlation between
outcomes or the outcomes the AI is producing are great and better than ours, then we don't
need to understand the process because we might not be able to, and maybe we're limiting
the scope of AI by saying, okay, we need to understand what's going on here on the backend.
Yeah, so you're talking about explainability and that's tough.
Every single one of your questions has been tough because they're not clear cut answers.
Once again, things evolve.
You have to also be humble enough, and I'm speaking at myself, that with new data, with
new knowledge, with new expertise, you factor that into your thinking and your thinking
may change.
Once again, thinking will change, will evolve.
I think the underlying motivations and principles, those can stay constant.
So I think explainability is crucial for us to be able to justify, rationalize, make sense
of things.
We're not there in terms of being comfortable with the unexplainable when we have created
the unexplainable.
There's plenty of things that happen in the world that are unexplainable to us.
Life is in many ways, arguably, random.
There's so many variables to track for that we don't have the capacity to decide that
this caused this, this caused this.
There's so many different factors at play.
We're comfortable with randomness.
We're comfortable with non-explainability to a certain degree when we are not behind
it.
When we think about, oh, I was born in a rich family or I was born in a poor family.
Well, I can't explain that.
It happened.
We're reasonably comfortable with that.
We may argue about it.
We may debate about it.
We may at the end of the day say, I don't understand how it happened, but we know that
it happens.
And we have over the course of hundreds of generations gotten comfortable with that.
But we're not comfortable when we create that unexplainability.
We're not comfortable with the fact that I created a box and I can't explain what the
box does.
So that is ultimately on us eventually getting comfortable.
If the AI is doing a good job and we have tested it hundreds and millions of times and
it is leading to better patient outcomes, it's making our societies better.
Maybe we should consider it.
Maybe we should consider it that I can't explain how, but I know that this is better for us.
We're not there and I'm not advocating we get there anytime soon.
Right now I think it is very important for us to go from one step to another step to
another step.
I think it is, I'm not comfortable with that.
If I were being treated for something and an AI did something and we couldn't explain
how it did it, I would worry.
I would be grateful, but I would worry.
What if we do follow-ups here?
If something happens down the road, if we can explain what the AI did, then how do I
ensure my future treatment goes well?
I think we do need the regulation and we need to create frameworks.
This will be an evolving conversation.
It will take perhaps far more than your or my lifetime.
I'll ask what I think hopefully is an easier question.
If your LPs came to you tomorrow and said, we don't want any more returns, keep all the
money we've committed, what would you do the day after?
What if that amount was a billion?
Wow.
That is not a situation that will happen.
That I have a billion tomorrow and my LPs say keep it.
I know where you're going with this.
You're asking the hypothetical question is, if money wasn't an object, what would you
do?
That's the question you're asking.
If money wasn't an object and you had a lot of money at your disposal, it's not just that
you don't need any more money for whatever you want to do, but you have quite a bit of
capital that-
The second part of your question is an assumption that the world is the same as it is right
now, meaning tomorrow hasn't changed anything.
If tomorrow's world is significantly different than today's world, then I would perhaps take
different actions.
If there's an asteroid hurtling toward the earth tomorrow and I have a billion dollars
and I can do something about it, well, yes, then that's what I should do.
Because the principle is to value human life.
The principle is to value intelligence.
The principle is to make sure that all of us on this little spaceship traveling through
the universe, that we have the ability to reach the stars one day.
Getting a little poetic here, but the principle here is to preserve intelligence and human
life in general, and not just human life, life in general.
Being more specific here, I would continue running what I do today as a VC fund and I
would do a lot more of it.
If I have a billion dollars, well, then I can do almost 10 times more than I'm doing
right now with 85.
I would try to invest beyond what I'm investing in right now.
I'm focused on AI in healthcare, my partner AI in enterprise.
We might start doing AI in biotech, AI in climate tech.
We're focused on the US right now.
We're open to Canada.
We might start doing other geographies.
I would love to invest more in emerging countries.
India and Brazil are national fits for me, given my heritage, given my connections, given
my knowledge of those two markets.
But I would love to be able to do more things in Singapore, in the UK, perhaps even in other
countries where we are comfortable operating.
I would love to build a bigger team.
That's a necessity actually, not a desire.
It would be absolutely a requirement.
I would like to perhaps expand.
We want to be early stage, but with a billion dollars, it becomes tricky to be an early
stage fund.
Maybe we would become a seed series A and series B and start leading those deals.
With a billion, you probably will have to go beyond series B. That is not what I was
thinking, but we would have to seriously consider it.
I would like to build the type of fund that that's what I'm focused on right now that
does really good and really well.
So 10X returns, but also in some ways, the type of companies we're investing in create
value.
I believe very much that if you create value, you get valuation.
There's unfortunate for capitalism, those two things are not one and the same, but we
can make sure that we operate so that they both help each other.
There are ways of making money in this world that do not create value.
It sounds like you have found your eikigai, which is the Japanese concept of purpose.
And it's the intersection of where you're good at, where you love to do, and what people
will pay you for.
I want to be mindful of the time, Amit.
Do you have time for one more question?
If not, we can end it here.
Let's do it.
It's been an honor, Shad.
You're very kind.
You're very tough on your questions and very kind on your comments.
What makes you resilient?
This is something I've been thinking about for my kids.
My previous answer would be you have to go through adversity to be resilient.
Looking at the studies and the data out there, from what I've found, resilience comes from
a good internal and external support system and doesn't necessarily require experiencing
obstacles and overcoming them in a healthy fashion without maladaptive behavior.
What makes you resilient?
I might be changing your answer by saying that.
No, no, no.
I think you're right.
No man is an island.
I think part of it is yes, you're internal, somewhat shaped by your experiences, not always.
I do think you can learn from other people's experiences, by the way, just because I'll
take a very stupid example, but you wouldn't go and jump into a well.
That's by the way a proverb in Hindi.
The reason you don't do that is because you know that jumping into a well for the last
guy who did it didn't turn out as well.
You learn from somebody else's experience.
I think there's a component here of what you experience yourself, what you learn from others,
what you learn from others by watching them, what you learn from others by reading in them,
what you learn from others by just what other people share with you.
There's a component of resilience that is absolutely the village around you.
Now there's obviously situations, incredible stories of people who beat all kinds of odds
with very little support systems.
There are also stories of people with a lot of support systems who don't get the amount
of resilience perhaps that they were hoping for.
There's a spectrum.
It's very contextual.
If you have resilience in one area, you may not have as much resilience in another.
I'm not aware of those studies you might be, but I am willing to bet you that physical
and mental resilience, there's a correlation, but they're not necessarily completely connected.
I may be great at handling stress at work, but be terrible at handling stress when I'm
running.
It's not a perfect correlation.
For me personally, I think it's all of the above.
I think resilience is a muscle in some ways.
You have to keep exercising it.
It's easy to fall too comfortable.
I'm grateful for all the people around me.
First and foremost, my wife, she's my rock and she didn't pay me to say all of this.
When she hears this, I'll hopefully make some brownie points, but it's really true.
She gives me a lot of wisdom and she gives me a lot of direction and she helps me how
to be better.
Obviously, my parents, they were who gave me the foundation.
My teachers, my mentors, both in the past and in the present, my friends, both in the
past and in the present.
There's people that I've never met, some of them alive, some of them not alive, who are
role models.
Obviously, I'm building Tao Ventures with a team.
My co-founder for sure.
The reason we are building this fund together is because we know we are a good team.
We are a good partnership.
We can keep each other both accountable, but also bring the best in each other.
Big shout out here to you, Sanjay.
I don't think I'm perfect at this, Rishad.
Nobody is, to be honest.
The day I believe I am or that I've hit my limits, then that means that I'll start failing.
It's a good reminder to myself, there's always more to learn.
There's always more to unlearn.
I discover every day as I go by that something I knew, there's far more to learn about it.
Resilience included.
It's been great talking to you, Amit.
Thanks so much for coming on the show today.
We didn't get to talk too much about investing or other topics I had in mind.
Would love to do it again in the new year.
Absolutely.
Thank you for having me.
Thank you to all of you watching us.
We are TaoVentures.com.
Feel free to check us out.
We read everything that reaches our inbox.
So welcome to reach out.
I'm not able to respond to everyone, but I will certainly read it.
Once again, we're a focused seed stage, primarily enterprise and healthcare, investing in the
US, but very much open to Canada.
Awesome.
Thanks, Amit.