Manufacturing Renaissance in the US with Jack Dreifuss
This week’s guest is Jack Dreifuss of Impatient Ventures, where he focuses on disruptive companies in the early stages of their growth cycle. In our discussion, Jack shares his views about innovation areas including chip manufacturing, AI-supported manufacturing, innovation on climate sustainability, decarbonization spaces, investing in reshoring U.S. manufacturing, and the future of the workforce. Jack also touches on his interest in local agriculture and commerce and reveals how poker has played a role in his life. Where in the tech and innovation space will you find the next fat pitch? Listen in and decide for yourself.
RECORDED JUNE 15, 2023
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Fat Pitch Ep 8 - AUDIO
Tue, Jun 20, 2023 10:18AM • 39:00
SUMMARY KEYWORDS
company, talked, world, invested, manufacturing, space, jack, ai, clint, innovation, semiconductor chip, poker, lead, create, produce, jobs, China, happen, globalization, trade
SPEAKERS
Clint Sorenson, Paul Barausky, Jack Dreifuss
Paul Barausky 00:04
Well, hello everybody. I'm Paul Barausky, Chief Distribution Officer, Sealy Investment Securities, your host. And I'm joined as always by my co-host Clint Sorenson of WealthSheld. Clint, glad to have you here this week for this ep of the Fat Pitch Podcast. And I'm thrilled to welcome our guest Jack Dreifuss. Clint, I only met Jack a little while ago so why don’t you fill our audience in on all things Jack before he tells us even more.
Clint Sorenson 00:31
Yeah, so Jack is the founder of Impatient Ventures. And he focuses on really disruptive companies in the early stages of their growth cycle. Very excited to talk about venture capital and everything that's kind of going on in the marketplace. So super excited, Jack, thanks for joining us, why don't you give the audience a little bit about your background?
Jack Dreifuss 00:51
Yeah, thanks for, thanks for having me, Clint. So I guess I've been in the founder ecosystem for it’ll actually, officially be a decade next month, I moved to San Francisco in 2013, worked in a variety of startups, both as a founder and as an early stage employee. And kind of through that journey, I had kind of the full lifecycle of, you know, wins, losses, and everything in between, and just understanding kind of, you know, what people mostly read about, about anything is usually 10% of what it actually is, so having lived through kind of the, that sort of last, you know, grade sort of bull market that was primarily driven through a lot of what was coming out of the Bay area where I was, I was fortunate to kind of gotten my start at Harvard network. My next door neighbor was a co-founder of Postmates, and, you know, the guy that I played golf with every week was a partner at Andreessen Horowitz. And so, you know, I was fortunate to have lived through a kind of enough of the kind of full gamut of Silicon Valley that now kind of in the last year, I've been building this new fund that, you know, I've gotten to partner with folks like Clint, so Yeah, happy to tell you more about that.
Paul Barausky 01:54
Yeah. Well, the name impatient immediately piqued my curiosity. I think as investors in some regard, we're all a little bit impatient. So where did you come up with the name? And what's your philosophy?
Jack Dreifuss 02:06
Yeah, so you know, the original very first name, when I was kind of investing more as on the side while I was still operating, was actually an homage to my love for fried chicken. So the initial name was actually Karaage Capital. Well, you know, which is the Japanese fried chicken and then eventually, I evolved it because of my Jewish roots to Schnitzel Capital. And so for actually, this first couple of deals that I did, there's actually a press release from me leading a seed round and a company as the general partner of Schnitzel Capital. And I think when I kind of was now turning it into the main focus in my day to day is, I needed to name it something that's still had a little bit of tongue in cheek and humor, but wasn't quite as ridiculous as, you know, fried chicken. So yeah, I mean, it's meant to be kind of a play on the fact that like, this game is a patient game, but we live in an incredibly impatient world. So yeah, there was that.
Paul Barausky 02:55
Well, if do you ever make it to Dallas where I hang my hat, a good South African Jewish friend of mine makes some great Karaage, oddly, and the best chicken schnitzel I've ever had.
Jack Dreifuss 03:05
It was in Dallas for the first time a few months ago and loved it, so that'll be a good motivator to come.
Paul Barausky 03:10
A culinary adventure. Clint, go ahead. What do you got for Jack?
Clint Sorenson 03:15
Yeah, so Jack, you know, one of the things that really intrigued me and kind of I feel like, you know, bound us together was this kindred spirit on or, you know, same philosophy as it regards to deglobalization. So we talked a lot about Peter Sands’ work we're talking about, which, obviously, from the title of the book is the end of the world is just beginning, which is fascinating as the title. But we talked a lot about that work and what that meant for the U.S. and you had just such a great optimistic viewpoint on what that can mean. And so, talk a little bit about your fun and your view, and really your philosophy on deglobalization and how you plan to take advantage of that for investors.
Jack Dreifuss 03:53
Yeah, definitely. So you know, I think that if you think about kind of the sort of, period where, you know, maybe kind of had an out of that, sort of that book is built around the end of the world is just the beginning, you know, kind of post World War Two, we had this kind of wild integration of all the sort of countries that were once either at odds with each other, or for whatever reason weren't, you know, trade partners, kind of the US sort of winning World War Two, sort of created this really unique phenomenon for the first time in the world where, you know, outside of the US, and it's, you know, mighty military, most other countries no longer needed to focus on military power, because the US kind of policed everything. And so everybody could just focus on one thing, which is economic prosperity. And so that opened up the doors for, you know, Japan and Germany who lost World War Two, to now become today to top five, you know, GDP economies in the world. And that was primarily driven through nobody needed to worry about building a sort of military aspect to their country. They could just focus, like I said, on growing their economy. And so that sort of spurred so much growth in the world in terms of innovation and trade and collaboration and, you know, we now seem to be getting to a point where the ongoing war and you know, sort of Ukraine and Russia, the growing tensions between the US and China, there's sort of this now, large sort of redistribution of kind of trade partners and where things are made, and who's trading with who. And so I think, in the spirit of the US, we outsource the vast majority of our supply chain to low cost labor markets, primarily in China. And, you know, I think that, because of that, we were able to obviously focus on, you know, much more innovative, you know, sort of knowledge economy based type of work. But now that sort of this tension point is sort of reaching ahead a bit, we seem to be in a position where a lot of the supply chain that we sent offshore, there's momentum to bring it back. And so that's going to require a hell of a lot of improvements and funding. And we're, we're spending a lot of time kind of paying attention to what are those technologies that will enable that to happen?
Paul Barausky 05:56
You know, it's interesting, I hang my hat in the industrial warehouse distribution and fulfillment space. So we think constantly over the past couple of years about that see change or resume change that you talked about, right? I mean, it's remarkable. You had a piece dividend, you had demographics in your favor, and deglobalization. And now we've had this shift. So we talk a lot about friend-shoring, on-shoring, or near-shoring. So I presume a lot of that calculation and thought goes into where you're at.
Jack Dreifuss 06:27
Yeah, deglobalization, you know, if you think about it, it's kind of interesting that I'm sure both of you guys and for any of the listeners are familiar with, you know, Taiwan Semiconductor, who's, you know, the primary chip manufacturer in the world, they produce around 90% of the global semiconductor chip production. And as much as that seems like, well, they must just know how to do something no one else does. Well, it's kind of bizarre, because, you know, we invented the semiconductor chip, right. And so it was like, you know, oops, we invented this tech and negated sort of this by letting Taiwan do it for 40 years. And now we don't have the trade knowledge anymore on how to make the very thing we invented. So it kind of the same with every, you know, manufacturing. And what it really comes down to is, it's all driven through profits, and you want low cost labor for better profits, when it comes to kind of making things inside of any type of facility, whether it's a semiconductor chip, or, you know, steering wheel. And so, for a while, it was driven through just wherever things can be made the cheapest. And now for a number of reasons, both primarily national security, that's got to change. But that will require a huge step up and the trade knowledge that we've lost as a country.
Paul Barausky
Lost and given away.
Jack Dreifuss
Yeah, yeah, lost and given away, no question about it. So I think that there's going to be two things that are going to happen. Obviously, we have the advent of, you know, machine learning, that's, you know, really taking its shaping every industry, but I think that was going to be a big boon for us to be able to bring back a lot of jobs inside of manufacturing by automating a lot of the like, lowest kind of totem pole labor work that really a robot or software could replace, and, you know, create an innovation on the factory floor, that will still be, you know, from a an American standard sort of thing, a compelling and rewarding job. But, you know, I think it will also require a lot of US government support. So I expect that similar to the Chips Act, and, you know, Build–I always get the tongue twister–the Build Better back
Paul Barausky 08:17
Build Back Better.
Jack Dreifuss 08:19
Build Back Better. You know, I think there's going to be a litany of kind of bipartisan support in either administration, you know, they'll spin in a different way to be able to galvanize and re galvanize an industry that was once you know, 30 to 40% of our economy is now down to sub, you know, 10%, which is in the you know, everything sort of manufacturing and supply chain.
Paul Barausky 08:40
Yeah, and you're still creating jobs. And that's how they'll get by this pernicious political partisanship, as I like to say, because you will automate that lower the lowest rung of jobs to create you know, economic viability, but you still creating jobs, then you're creating support jobs around that production. Whether it's warehousing, shipping, restaurants, cafes, housing, what have you. Yeah, around it. So we think that Renaissance too, it's interesting. I didn't know when we got on today that we'd be aligned in that. Well done, Clint.
Clint Sorenson 09:15
And now Jack, what do you see in like, what types of companies you've seen out there that are kind of doing this right, taking advantage of these trends? I know, I know, a few just in our conversations. But why don't you give the audience a little bit of color around you not to give names or anything that's up to you, but around what companies are seeing doing some really cool stuff in this space and sharing and really helping us lead that track?
Jack Dreifuss 09:37
Yeah, I mean, so you know, I had more of a traditional sort of software career and sort of the companies I operated in and it was kind of actually a two investments that led me down the rabbit hole getting pretty interested in kind of the manufacturing sort of physical space of innovation. And it was a company that obviously you know, Clint, we're we've looked at together and I don't know if I can speak you know,freely about, you know, our co-investing in some of these deals, but you know what one of them was a vertically integrated consumer brand. And, you know, I think it was sort of through realizing the edge that they had and sort of not only being the sort of front end brand that has a direct to consumer sort of Shopify base store for what they sell, but also the fact that they were, you know, masters of their own destiny, because they also made their own product that I realized kind of the edge you had, and specifically the consumer brand space where you could, you know, rapidly improve the products, innovate on the supply chain side of things to improve margins, you know, by creating innovations of kind of how the, you know, the bottles get filled across the the fill line, and just realizing that by having that as a as a, as a sort of skill and an edge inside of a, you know, early stage consumer brand, they've now in a in a world where there's been kind of a contraction inside of consumer spending and descended from a discretionary standpoint, I'll check my data with the macro economist folks on here. They're there, they're thriving. And I think they're thriving because of the fact that they own their own destiny by not only selling the product, but also making it so that was kind of investment number one that really led me down to realizing how much of an edge it was in the consumer space. And then kind of flipped to the to the other side of it, you know, we invested in a company several years ago, I personally invested and then we invested on behalf of my LPs into a company called Nanotronics, that, you know, I think, you know, you'll hear that name, and I think over the next five plus years, it'll become one of the most important companies in the United States, their initial business was quality control for production inspection. So you produce, you know, small parts like a semiconductor chip, obviously, you have no margin of error, that chip being produced correctly, both and it's, you know, if it's contaminated if the parts are aligned the right way. And so these guys have basically built this product called inspect that's been inspecting, you know, production lines of the leading most advanced, you know, consumer electronics and chip manufacturers in the world. And they kind of now hitting this sort of final frontier, that I'll speak briefly about, but it's kind of waiting to sort of fully hit the markets, and there'll be news about it soon. But they're going to basically enable, I think, the US to bring a lot of chip manufacturing back on shore. And it's because they've spent 15 years inspecting on producing chips across every type of company, you could think of that produces a semiconductor chip and making sure they produce it accurately, they've now built up the sort of that machine learning knowledge to be able to now enable companies to be able to do chip manufacturing for themselves. And so I can't, you know, speak enough about the CEO, but just the the level of impact that will have on us reshoring a technology, like I said, that we invented, right, the advanced microchip. And yeah, those two companies have vertically integrated oatmeal company and mentioned that's what they they sell that business that you know, is on track to do nine figures of revenue this year, from, you know, a 10th of that two and a half years ago, when we invested, and then you know, a sort of smart factory that's going to allow us to restore semiconductor chip production. And those two kind of just perfectly sit in symmetry with each other that just made me kind of go down the rabbit hole and realize that this is going to be one of the most both lucrative efforts and, you know, a sort of American supporting efforts over the next couple of decades.
Paul Barausky 13:21
That's fantastic. So are you primarily an early stage equity investor? Is that how you generally take a position in an idea or company?
Jack Dreifuss 13:30
Yeah, so we'd like to kind of be if we can be first money in, great, but near and around kind of pre seed and seed, opportunistic Series A, it's really in the wheelhouse of where we're betting on, but we just found the company too late. So yeah, primarily early stage. You know, we like to be a leader, not a follower. We will follow, though, if we have to, but you know, I'm very sure in this sort of strategy and investing in reshoring US manufacturing, and I do sincerely believe that it's going to be not only good for the country, but it's going to be a bipartisan effort to support that.
Paul Barausky 13:59
Yeah, that's fantastic.
Clint Sorenson 14:00
Yeah, I personally love the Nanptronics story. Yeah. Thanks. Jack got to visit the facility up there in Brooklyn yards. And it was just fantastic.
Paul Barausky
Oh, it's in Brooklyn Yards? Huh, interesting.
Jack Dreifuss 14:09
Yeah. Yeah, they actually, their headquarters are in the original US submarine assembly facility. It was like during the Lincoln wars, the place where the first submarines were getting assembled. And they basically took that over and built their kind of own machine shop where they build their hardware–it's, you know, hardware and software, and pretty soon based on this sort of new product that I can't speak too much about, but it's in and around the ability to kind of produce, you know, semiconductor chips in house, which is what their technology is going to enable. They might take over a former airstrip in Brooklyn as well to kind of put this chip fabricator
Paul Barausky 14:48
Say along the lines of what we're talking about with moving manufacturing back, do you think at all about the trade issues with China? I mean, obviously at the beginning of it, every company along with food chain had gone to a China plus one strategy. That's literally what it was called. So whether it was China plus Vietnam, China plus Mexico, China plus Uruguay, right? does that play into your thinking at all? Because at least from our vantage point, we don't see any abatement of that anytime soon. It's almost cute to think of pre COVID in ‘19, when Trump and G both told everybody that just solved the first stage of it. You remember that guys? Right?
Jack Dreifuss 15:26
Yeah, yeah, of course. Yeah. Yeah. I mean, I think that there is a there's kind of a silent war slowly going on. And you know, I've just been hearing its rumblings. I mean, on the one hand, you have, you know, that the banner headlines of, you know, Montana bans TIkTok, you know. I don't know if Florida has done this yet, but was planning to ban DJI drones, you know, which is the Chinese, you know, autonomous drone company. And I think I had heard recently, all I need to get my facts checked here. So that, you know, China imports a lot of food from the US, we obviously produce all of our consumer electronics that are I mean, I think last year we produced the most ever was like half a trillion dollars worth of consumer electronics. So it's like we're still producing now more than ever inside of China. But there's this kind of like, slow, slow war of attrition of like, stopping doing something banning something and they're now doing the same thing. So I think I had heard that they stopped buying certain crops from Texas and other states.
Paul Barausky 16:19
I believe that's correct. Yeah, that they cut back on some of it living here in Texas. As far as Florida, Jack, DeSantis is too busy fighting with a mouse and Bob Iger. So I don't know that he got around to fighting with anyone else.
Jack Dreifuss 16:33
Yeah, so I think that there's going to be just kind of this like, who blinks first kind of Mexican standoff of sorts until something major happens, but I think it's going to be kind of this, like, you know, Virginia and Glenn Younkin, I think had had the Taiwan Prime Minister recently had this major visit. And I think, Glenn Youngin is in Virginia, right? I think so. And, you know, he had the Prime Minister come, and they're they announced that they're setting up a trade office inside of Taiwan, Virginia. But, you know, China's a $10 billion trade partner, Taiwan's a billion dollar trade partner, for him to come out and sort of say, Hey, we're welcoming the Prime Minister, we're going to set up a, you know, an office there, and, you know, we're going to protect our relationship with Taiwan. I mean, you know, it's a big statement of mate with, you know, where your largest trade partner is looking at that as kind of a bit of a, you know, race, middle finger, yeah. So, you know, I, again, for any, you know, Biden's going down the same, you know, play here, I think this is ultimately a bipartisan effort. And, you know, I think it ends up in a world where we're all scared of AI taking away a lot of jobs. I think that AI is actually going to be the very thing that allows us to restore manufacturing and create more jobs.
Paul Barausky 17:44
No question. Yeah, it's kind of literally take out that L side of the P&L for a lot of those jobs, and an AI will enhance it. I think a lot about 3D printing, too, just because of light industrial, and what you can do, I think that lends further credence to what you're talking about alongside the chip stuff. And it allows a de–Clint, we talked about the de-globalization, he always talks about decentralization. So it allows, you know, multiple inventory and production sites at a low cost.
Jack Dreifuss 18:15
Yeah. Yeah. I mean, 3dD printing is not something that I am as competent in, but it does seem like, you know, the Star Trek sort of future state is that you'll be able to kind of like, you know, point and shoot and build a car. And you know, but the question is, is just, what's the sustainability of kind of the materials? You know.
Paul Barausky 18:35
I'll give you a different one. I was down speaking to a group of folks in Houston in the oil and gas patch. And they talked about, they're in the midstream business in the pipeline type of business. And they talked about very much working actively on 3D printing for parts ongoing for stuff. Now that inherently made sense to me. I think I see you both nodding, like that just makes sense to me for a company that's in the parts business..
Jack Dreifuss 19:00
Yep. Yeah, I mean, I think that the interesting thing is, is on the one hand, we obviously have things as advanced as kind of, you know, artificial intelligent tool design, that's an area that we recently invested in, you know, how do you kind of create the very sort of tools that allow us to create parts. So, you know, we invested in a company called Atomic Industries that is using computation to design plastic injection molds. And so to the extent you're familiar with, you know, plastic injection molds, you know, that's a $60 billion industry that, you know, accounts for the vast majority of products that we use on a daily basis, but making those steel molds that create our iPhone cases in our shampoo bottles in our car doors, is an extremely expensive, laborious, non-standardized process. And so there's so much baseline sort of catch up. That is, right low hanging fruit right at our feet. And actually, interestingly enough, it was kind of this perfect storm. The same day I met the CEO of this company. I’d actually gone to a site visit at Nanotronics Brooklyn Navy yards facility. And it just so turned out that another fund that I co invested with in this deal was having the CEO of Nanotronics, do a due-diligence call with the CEO of this AI industrial tool design company. And said to me, “This was so obvious, I don't know why we didn't think to do something like that.” It's always a great sign. And I think that there's just so much low hanging fruit, you know, we're evaluating a company right now, that's building sort of a GitHub if you're familiar with the kind of, you know, popular code repository platform for machine automation code. So you know, the biggest innovation was kind of putting a computer on the factory floor to tell machines what to do programmatically, you know, lift, spin, push, fill, etc. But, you know, that happened 40 years ago, and that's been the crux of innovation. So the US manufacturing industries, and there hasn't been really much improvement since. And so, you know, the ability to manage the code that runs those machines in the cloud seems like something that you'd think would have been done at the advent of the cloud, you know, 15 years ago, and yet, it's still managed, like an internet 1 sort of, you know, version control and management process. So there's so much low hanging fruit that like the job creation, and the opportunities are so massive, both from a return on investment, but just a job creation standpoint, that, you know, I think you could see cities that once were the Silicon Valleys of this country, like Detroit, Michigan, and the likes become those sort of magnets for innovation, once again, if we can embrace the fact that this unnecessary innovation to reshore manufacturing will be a boon, you know, across every city and state.
Clint Sorenson 21:38
And it's really AI supported manufacturing, which I love so much, because there's this whole AI craze going on, right about generative AI and natural language processing. And everybody's kind of wrapped up in that we really start to think about the applicability and how it adds so much value long term to society, you're going to eventually come down to, you know, AI that supports manufacturing. It's almost like every company became a tech company, every company is going to eventually become an AI company. And I just think, yeah, this is just such a fascinating space, because it's going to just increase yield, right, ultimately, lower costs across the board. And then my favorite part decentralize it, right? So you're not going to have just centralized huge conglomerates that dominate the space, you're going to have more of a decentralized approach. And that's what really got me on what's going on Nanotronics. I just love that whole approach. Right? I just think that that just supports and provides the necessary fodder for success and upward mobility for society. So really exciting stuff.
Paul Barausky 22:39
I want to question. So Jack, you talked, we started out, you know, you kind of went down the line of the chip manufacturing. Now, we just talked about the AI supported, the other stuff. What are some other verticals, industries? What else are you curious about right now?
Jack Dreifuss 22:53
Yeah. So wherever you stand on, you know, ESG, sustainability, climate or otherwise, there is just going to inevitably sort of be a necessary, commensurate climate impacts consideration for both the reshoring of US manufacturing and just the standards of how things get made and move in this country. And so I think, similar to a lot of these sort of alternative energy industries and whatnot, there's, they've obviously been riddled with a lot of kind of growing pains, as any startup does, whether it's fraud or bad participation, or the tech not getting to where it needs to be to really take off. And so, you know, we invested in a company that hasn't kind of come out of stealth yet, so I won't name it too heavily. But you know, it's in and around, how do you kind of create better verification checks and balances inside of the carbon credit space? And there's obviously been a ton of money that's put into it, I think it was something like a quarter of all venture dollars in 2022 when climate technology space and so everybody's kind of coming out and saying, Oh, we're going to be carbon neutral by 2030. We're going to be carbon neutral by 2030, electrification of our companies and whatnot. And so I think there's a bit of a pie in the sky and sort of, you know, hope that that'll happen. It's going to take probably a lot longer than people are thinking, but I think there's going to be a government sort of standard around what is your climate impact and so decarbonisation alongside deglobalization, it's easy to kind of say, because of the DS decentralization are, are definitely in around the kind of space that we're paying attention to. And I think that the innovation on the climate sustainability, the decarbonisation space is both a necessary piece of–I like to say, at a simple level, you know, you put a loaf of bread in the oven for too long, it's gonna get burned. And, you know, we've been spending kind of the last 100 years putting a lot of carbon into the atmosphere. And so, you know, and it's, we've obviously had, you know, global greenery and we've had sort of record, you know, we've had record improvements in certain respects from carbon because it is the, it is the food of plants, but you know, you get to imbalance and that can create problems. So I think decarbonisation, and I think the government's going to be getting pretty behind that. I think, you know, the days of sort of banning plastic straws is a sort of, we got to move beyond that into something that's more, you know, impactful. And so I think that's going to be another area we're pretty heavily focused on. The last area, I'll sort of say that, you know, tends to be of interest here is, you know, I think that in the world we live in now where there's this debate of kind of, you know, is it hybrid work? Is a remote work, or is it an office? You know, I heard an argument the other day that actually, Highbury work is kind of a cop out, because you're only in work in the office couple of days, and not in other days. And it's like, well, you're kind of forcing people to live in this way, where it's like, is this really adding value? Why am I going to call it like, you're either in the office, you're out of the office? And it was a decent argument? I don't know. But what I will say is that, say what you will about what was right to have done during COVID, it did ultimately unlock a lot more cities and states inside the United States and unlock a lot more countries to be able to have labor available. And so I think, because we have decentralized the workforce of sorts, and we can access talent in states like, you know, the Dakotas, Minnesota, Alabama, and otherwise, that we're not necessarily key players in the sort of tech and startup scene. Also, you can have participation, because we have decided that remote work is a feasible way to still run a company. We're still waiting for data here. We don't know what's right, we got a lot of advocates are saying there's no way it works, you got other people that say you just don't know how to manage people. That's your problem. So but I think what it does spell is the opportunity for there to be a lot more habitation specifically in the United States where people can go and live in different sorts of cities inside Ohio and be of higher earning, you know, member of the innovation sort of AI space, whatever it is. And so, you know, I'm particularly curious and interested to kind of track along we're actually incubating a business in and around sort of this arena of how do you kind of unlock commerce and more of us, that's not just kind of the four major states that we're used to it all existing in. So I think local commerce is pretty interesting. And I think local agriculture is pretty interesting. I haven't bitten off anything yet in that arena. But I think we're all waking up to high fructose corn syrup forever chemicals and all the crap that's in our food and our you know, seed oils–
Paul Barausky 27:05
Palm oil that's destroying the other half of the world
Jack Dreifuss 27:10
Not to mention the, you know, galvanized lead pipes that are feeding municipal water into our homes and, you know, poisoning us in many different angles. So I think we're waking up to the most understanding of how to lead and live healthy lives. And you know, we used to have for some reason dawned on me that the reason we call it unleaded gasoline is because there used to be lead and gasoline that we burned until 1975. My mind kind of spilled out of my ears when I heard that I did not realize that that was getting you used to go to the doctor, and he'd be smoking a Marlborough while he's giving you his prognosis and how to live a healthier life.
Paul Barausky 27:40
And then now we think that's bananas. We're gonna look at things like that. Coming from a guy who's talking to you from Texas, there will be a day when we think the idea of burning fossil fuels unrepentantly was absolutely insanity as well. I looked into vertical farming about two years ago and found that to be utterly fascinating, and it mixes in with a lot of new styles of TierPoint reimagining what the city center is right there with the look at cell phone pings in downtown areas. So you're in New York today, I think I just saw I think in the Times Weekend, as Trump would say the Failing New York Times, I looked at the fact that cell phone pings are at pre COVID levels, not maybe in Midtown, but all over the Brooklyn neighborhoods in downtown and then parts of Queens and other things. So the cities being reimagined as a place where people gather to be with other people, and to be productive with their work, but with their minds with their sense of community with greenways. So I think that all ties into a lot of the things you just talked about. And I think you'll start to see the advent of urban farm and some of the healthy themes you talked about, along with the attention to the climate.
Jack Dreifuss 28:57
Yeah. Well, don't get me started. I've got a couple of tinfoil hat sort of theories on a handful of stuff. But you know, why we started farming, something like you know, 12,000 years ago, we domesticated the cow 10,000 years ago, we lived on farms, we produced our own food, it was all there was all available and only in the last 100 years have we moved to this city life. And it's so foreign to people, you know, Peter Zeihan talks about this. It used to be that you'd have as many kids as possible because it was free labor for your farm. Yeah, you have kids and their dirty, you know, line item that you know, costs you money as opposed to produce, you know, your crops and milk the cows. And so, I think we're just we're so in our infancy of figuring out how to get accustomed to just being so plugged into, you know, the global sort of information system that we're all a part of, and trying to make sense of, and so I can tell you, I grew up in a suburb, but now over the last 10 years of being independent I've been every time I am at any farm. I just feel like my bones get softer and I'm more at ease and I don't No, it's just bred into us, you know, the modern human was, was bred and evolved through this sort of farm settlement thing that we did for such a long time. And it's really only in this little fingernail in history of our species that we've now moved away from that. And so I've started drinking, you know, and the people are gonna say, like, oh, Did you hear that from this podcast or not? I honestly just started doing it on my own. I do listen to some of the podcasts and might purport to sort of recommend it, but I started drinking unpasteurized milk. Yeah, and honestly, I've been doing that for a year now. Whole, unpasteurized milk. I mean, I'm an Ashkenazi Jew that allegedly we're all sort of lactose intolerant, according to the standard.
Paul Barausky
Yeah, you guys live in the Pepto aisle.
Jack Dreifuss
Well, so I thought that was the case. I grew up eating, you know, cereal with, you know, 2%, milk and whatever. And I would just, you know, I'd be making fart jokes in class and middle school, and I swore off milk and I went to the plant based milks, and I was, you know, that was the thing I did. And I will tell you again, I was unaware to what's too often in these plant based milks, which is some combination of seed oils and unbelievable amounts of sugar and preservatives. And we went from, you know, the final moments of the Got Milk campaign where every star athlete was recommending dairy to down with dairy and down with, you know, I've now been drinking whole, unpasteurized milk for a year. And I tell you, it feels right. And it tastes great. And I've had no issues. I drink raw kefir. My stomach's been amazing because of the probiotics from that. And I've proselytized and converted a lot of people to my milk religion. And I have convinced many people who swore off, you know, dairy and milk, and now they're drinking regularly. And so I think it's just you know, we're waking up as a society to a lot of information that I think was told to us and we never actually learn for ourselves. And it's invigorating. And so I hope to one day own a farm somewhere, I might go to Montana, I have no problem with Tiktok being banned, so.
Paul Barausky 31:51w
Hey, that's my spot. You can go down to Austin and eat some raw, what is it antelope with Rogan too? Yeah. Grass fed antelope? Well, I don't want to overstay our welcome. These are some fascinating themes. Clint, you're the investment expert. I'm just the dumb guy, here, you want to ask Jack, a couple of questions, more investment questions, then we'll takeout for today?
Clint Sorenson 32:17
Yeah, no, I think we covered everything. I think the only thing I have is a better question, which leads to investment success. But I want you to tell the audience a little unknown secret about you and your poker history, because I think this is fascinating.
Jack Dreifuss 32:30
Yeah, I mean that we could have a whole other episode on this. I truly believe life is one giant poker game. It's a little bit of luck and a little bit of skill. And you know, most people say life is chess, not checkers. But that's actually an untrue thing. Because if that's true, actually, then AI would take over because in chess, we know already Deep Blue, IBM beat the world's best chess player. And so chess is math, there's a best math decision, you can make it every time. In life, there's probabilities, there's a good decision, but there's still probability so you can make a good decision and that leads to a bad outcome. So yeah, when I happened to be in high school in college, it was during the heydays, if you follow poker at all, in 2003, we televise the World Series of Poker on ESPN and this no name, accountant from Tennessee, aptly named Chris Moneymaker wins the World Series of Poker qualifies through a $10 satellite tournament on PokerStars. And he's this nobody that becomes an overnight multimillionaire and took the world by storm, everybody in anybody was playing poker. And I happen to be fairly young. When this happened,it was the end of my middle school in high school. And I was obsessed, it felt like this first time where it was like, you know, there was risk, there was human elements, there was math, it was so much fun. And so for a brief period of time, I happen to be one of the top online poker players in the world, and I happen to have been doing it under age. So I don't think I get in trouble by saying that out loud. But I've had my fair share of getting kicked off of accounts. But that kind of led me to really appreciating the poker minds. And so one of the reasons I actually ended up investing instead in a verticalized oatmeal company called Oats Overnight. The CEO is one of the best cash game poker players in the world. And I have this signal in my investing. It sounds kind of silly, but I call it the chapter two comedy signal. And what that means is how ridiculous was chapter one to chapter two switch? This guy went from being a top 10 Cash game poker player in the world to running a vertically integrated oatmeal company. I mean, you couldn't ask for a starker difference of career choices. And you know, somebody that is able to think, in that level of game theory and probabilities and decision making, to me is an aspect of a truly extraordinary operator. So I think poker is a great way to look at kind of how life works. And I have an affinity for operators and founders that are poker players as well.
Paul Barausky 34:41
Oh, that's really cool. That's great.
Clint Sorenson 34:45
And that's great investment advice, Paul. if you think about it, it’s luck and skill.
Paul Barausky 34:47
I always bring up poker but then I have to immediately bring the disclaimer in if we don't look at investing like gambling. Now I try to limit it any more. If you go back and listen to our pods, I'm constantly talking about when odds are in your favor and stepping away and waiting in and all of those things that poker players know to do and analyzing. And I always like to go back to the famous quote, if you've been at the table for 30 minutes, and you don't know who the rube is. it you. Yeah, I've just learned that lesson.
Jack Dreifuss 35:19
Yeah. Well, I'll say too just, you know, there's an author of a book and I'm actually just looking up his name Jim Collins, he wrote a book called Good to Great and this really stuck with me as the first conference of my first job out of school, I was a sales engineer at vox.com. And he said in his keynote speech, that life is about capitalizing on good opportunities, and you can't control necessarily when those good opportunities will show up, but you can control if you act on those opportunities. So rather than saying ROI, he calls it ROL, so instead of return on investment, it’s return on luck. And so the best thing you can do as an entrepreneur and you know, or as a venture investor is to give yourself as many opportunities as you can to get lucky. And if you can improve your you know, your at bats, and, you know, your swings at those lucky situations, and you know, you're bound to hit, you know, some home runs along the way. And so I really think about how much can I increase my chances of being lucky. And you know, I'm happy as always, then you always say, it's better to be lucky than be good, well, better to be lucky as much as possible. And so optimizing for that ROL formula.
Paul Barausky 36:24
You literally just gave us a perfect spot to end this podcast because the name is the Fat Pitch. And it came from Williams talking about waiting for the fat pitch, but he was in there in the batter's box looking for it, right. He was creating it. There's a famous story about him on the final day of the season. It was a doubleheader against the then Philadelphia A's, I think he was already over 400, he could have sat out, he chose to play both games of the doubleheader, if my memory serves me, you know, hit well over 500 that day, but he divided that strike zone into some unbelievable amount of little quadrants, looking for–at your point–when the swing and the create action. So Clint always asked everybody, I’ll steal it for him, how can people find you, you’re on Twitter, on LinkedIn, anything like that?
Jack Dreifuss 37:14
Yeah, sure. It's impatient.vc is our website. It's a work in progress, so you won't see much there other than a couple of emojis but yeah, we were on Twitter, Impatient Ventures. I believe it's @impatientVC. Let me actually I got it right in front of me. Yeah. @impatientVC. You know, my email is jackatimpatient.vc. Yeah, I get plenty of of inbound. And I'm pretty good at looking at him for at least 30 seconds and deleting.
Paul Barausky 37:40
How about Twitter. Are you a tweet guy?
Jack Dreifuss 37:43
Yeah. My handle for the fund is @impatientvc. And then my personal one is just @ my last name, first. Second name. So @DreifussJack, I will occasionally tweet it almost feels like like a teenager's diary.
Paul Barausky 38:00
Tweeting about getting beat on the full house by some crazy flop.
Jack Dreifuss 38:05
Yeah. I mean, sometimes update my bio. And so I get a little cute. There's some of the most recent thing is, as I say, I'm a comparative pathologist. Because if you think about what is life other than my mythology against yours. I kind of get more cute on Twitter than I do serious. But it's a great obviously place for information. But, ya know, I mean, I'm excited. I couldn't be more opportunistic about the future of both this country and inside of this sort of tech and innovation space and, you know, excited to be a participant in it all, so.
Paul Barausky 38:33
Thank you very much. This, for me personally, was incredibly riveting. And it's nice to hear somebody with a positive outlook.
Jack Dreifuss 38:40
Yeah, definitely. Thanks for having me. Thanks so much.
Paul Barausky 38:44
Thanks. Thanks, Jack. Everybody. Tune in this week. Tune in next week. We'll continue to bring you some fantastic guests. And hopefully it's the next fat pitch you're looking for.