139: Mark Johnson - Philanthropy, Tech Transfer, and Startups

139: Mark Johnson - Philanthropy, Tech Transfer, and Startups

In this episode, we're joined by Stand Together CTO Mark Johnson. We discuss: Mark’s background, the problem with tech transfers from basic research, the cultural differences between Silicon Valley and San Francisco, how can we encourage a bottom up approach to philanthropy, how to manage well, and a whole lot more. 

William Jarvis 0:05

Hey folks, welcome to narratives. narratives is a podcast exploring the ways in which the world is better than in the past, the ways that is worse in the past towards a better, more definite vision of the future. I'm your host, William Jarvis. And I want to thank you for taking the time out of your day to listen to this episode. I hope you enjoy it. You can find show notes, transcripts and videos at narratives

Will Jarvis 0:38

Well, Mark, how you doing this afternoon?

Mark Johnson 0:41

I'm doing fantastic. How

Will Jarvis 0:42

are you? Doing? Great. Thanks so much for taking the time to kind of come on the show here. Do you mind giving us a brief bio and some of the big ideas you're interested in?

Mark Johnson 0:50

Sure. So um, I worked as a product manager in search when search used to be cool for everybody, basically, Buck Google. And then I'm a three time CEO, one was an AI newsreader called Zite, sold out to CNN and then sold it to Flipboard. The next one was spent out of Los Alamos focused on satellite imagery, so AI for satellite imagery to understand the planet. And then I ran an ag tech startup, focused on using AI to help farmers. And now I'm CTO at a community of nonprofits in DC. So I've been all over the place. But my real passion is trying to take deep technology and turn it into something useful. So most of the startups I've worked at have either had a lot of scientists in them and or have been spun out of the lab. And that's really my passion areas. How do we take all the incredible work that's being done in labs, and turn it into something that's useful?

Will Jarvis 1:49

That's great. That's great. And you mentioned that, you know, you worked at a startup down there and out of Los Alamos, which, which is interesting. And now you're working in DC. I am curious, it seems like an a libertarian think tank. Nonetheless, if you don't mind me categorizing it, I think that that's safe to say,

Mark Johnson 2:05

Ah, I mean, we're many things I would say that a focus on liberty may be one way to put it. I mean, our core principles here are that we believe in people, but we prefer bottom up solutions to top down solutions, and we'll partner with anyone to do right. I think some people can read Liberty into that. But really, the goal here is to address the root causes of some of America's greatest challenges. So we work on everything from criminal justice reform, to free speech and peace to end to economic progress. And I would say really, you know, the community of nonprofits that exists here exist to try to address those problems from as many angles as possible. So, you know, I'm working here in technology, we have folks focused on community based organizations, other folks focused on policy, but really, sort of it's a broad set of of capabilities that we try to bring to bear on on some pretty tear Aryan tough issues.

Will Jarvis 3:04

Love that. I love that and not trying to come after you at all. But I just want to I want to paint the picture for this question, which is something that's been bothering me for a long time. It is interesting. So you know, you guys are focused on bottom up kind of solutions. You know, you've worked at a startup out of Los Alamos, you know, the Manhattan Project turned into the Department of Energy, which seems to just be quite ineffectual. You know, we can't build a nuclear power plants, like what's going on man? Like, things just do not seem to be working at the federal government level, when it comes to technology? You know, what is your sense of what the heck has gone wrong? Like why they can the federal government not build technology anymore? Like, you know, this is what you're passionate about is, you know, bringing technology and making deep scientific progress, technology, making it useful to everyone. But it seems like the federal government is just not very good at that anymore at all. Like, you know, the best example anyone can come up with now is operation warp speed. There's a question about how like, effective, how fast, you know, how fast that really could have been, but it was a lot slower than like, we would have hoped. And that's kind of the shining example, right now, of state capacity around the technological, you know, frontier for the US government. What do you think's gone wrong? Is my thesis correct, that we're a lot worse than we were in the 40s? And 50s, that building kind of technology from the federal government lens?

Mark Johnson 4:20

Yeah, I mean, well, I would say a few things. One is that let's remind ourselves that we live in the Internet era, right? We went from not having mobile phones to everyone having mobile phones that are connected to all the world's information that are basically connected to processing units in the cloud that are equivalent to the human brain. I mean, a lot has happened just in the past few decades. So let's not forget that. But I think one might first question is what's the proper role of government with respect to deep technology? And sure, the Manhattan Project was a moment in time Bletchley Park, right when we, well when when England figured out how to crack the Enigma code, right, these really important projects, maybe you can even say In the Apollo program in the space race against against the Soviet Union, although that's probably a bigger scratch, those are sort of points in time where we really needed to bring technology to bear for existential threats to society. The reality is, we don't really have that kind of existential threat anymore. So a lot of what the government does is more speculative for the future. And I think the positive side is when the government tries to allocate dollars to deep tech to make society better, I think it's a great thing. I think the the dark side is when something like the NIH basically becomes a monopoly and funding. And we're not getting the healthcare outcomes that we want to see when there's so much regulation in health care markets, and the patient isn't put at the center of care, such that entrepreneurs like me, I am will started, I almost find a technology out of Medical Center in Nebraska while I was there, and the red tape and all the problems that were associated with it caused me to throw up my hands. So you've got a competent entrepreneur that basically when people say they want to go into some sort of healthcare related technology, the first thing I do is steer them away. So I think that like there's a lot of implications, the government's sort of getting involved in deep technology. I mean, maybe the last thing I'll say is that, certainly, like a lot of money comes from the government that goes to universities and national labs, we do an absolutely abysmal job of spinning out technology. So there's a lot of things you can criticize, I think in the science environment. But the one that I'm most focused on because I've done this multiple times is try to spin something out of an organization. So there's this well meaning app called the by goal act way back in the 80s, that was intended to to spur more tech innovation, and tech innovation coming out of these university centers that got government grants. What's happened with that, as you've gotten this massive bureaucracy where these tech transfer centers, they feel like their primary job is to protect IP, rather than get it out to the world? And I think that there's a lot of reform that could potentially happen there to encourage more entrepreneurs to want to work with research labs.

Will Jarvis 7:10

That's great. No, that's really interesting angle we actually haven't talked about on this podcast is, you know, tech transfers from basic research, you know, research labs or universities, university contexts definitely comes to mind. What are the biggest problems? Is it just the fact that people are protected via IP, and it's more just like, you know, you're only going to get punished if someone goes out and makes a lot of money? And there's only like downside risks, the licensing, there's not upside risk for X, perhaps for the tech transfer offices. Was there something else going on there?

Mark Johnson 7:41

Yeah, I mean, I think this obsession of wanting to the treat this it like it's a product, right? Like we're, you know, what's going to happen at the other end, the reality is that most of those products are still in very researchy phase, that still needs an enormous amount of research engineering to figure out what the product could be under a lot of market development to figure out how to turn that into a product and go to market. So I think they're starting too far back in the process and demanding things like royalties, demanding these onerous payments. And worse yet, keeping the talent in the organization rather than letting it spin out. And trying to use the IP is the as the thing to broker. And I just think this is a mistake all around. If you look at something like Los Alamos for every one actual researcher like Shockley, they had nine research engineers, and these people, their job was to take that weird transistor that Shockley and Burdine built originally and turn it into something that Western Union could go mass mass produce. And I think that's often forgotten. And you see this in a lot of these research institutions where they just are trying to peddle this IP that's not ready for primetime. And there's just this gap. There's a gap between deep tech venture capital, which isn't patient enough to figure it out and doesn't want to deploy enough capital, and the universities who want to click to access dollars, I think,

Will Jarvis 9:02

right, that makes sense. Oh, why do you think about connecting these two up a little bit more? You know, is it all like the the legal side, you know, a lot of these inventions and research is backed by federal government money? You know, should we be pushing them, you know, to be a little more lenient and getting more tech, like transferred into the real world?

Mark Johnson 9:20

Yeah, I think there's probably, you know, there could be some statutory changes that I haven't thought through all those. I think it's just really a point of view, really, is that if you look at where it's been very successful, for example, it's Stanford. And I wouldn't say it's their tech transfer, per se, that was so so positive, they're back going back to Hewlett and Packard, who came out of Stanford University, who were encouraged by the professors to go out there and start something. And that became a cultural element of Stanford. So it wasn't just again, it's not just about the technology that's being developed. It's about the people developing the technology. This against something tech transfer forgets, especially in this fast moving world, a patent today is not going to be useful a few years from now, in most fields that are at the bleeding edge, what you really need is the system that's going to generate more IP over time. And that original IP might be the base and in some cases has a company associated with them. But But in most cases, really, you just need to build more. So I think it's just a complete slip in thinking about how it fosters early stage startups. Frankly, I think there's a market gap here. I think I've thought about building this for years, I call it Morton labs, there's like there's something in between where the VCs fund, and where the ideas spun out. There's that messy middle that needs to be funded. And I haven't quite figured out the right business model for this yet. But I really think there's an opportunity here, and we can see a real flourishing and science technology if we got this right.

Will Jarvis 10:56

I really liked that I really liked that keep exploring. I that's really exciting. This is exciting there. I'm curious, you just mentioned some things, which remind me of, you know, different cultures, in within different institutions, and how that can kind of affect outcomes. You know, you've worked in a variety of different, you know, locations from DC to New Mexico to, you know, the middle of the country, and you know, San Francisco or the bay area as well. What are the big differences you see culturally between all of those different kinds of locations? And how do you think that kind of leads to certain success in different kinds of like, endeavors or perhaps hampers people along that kind of journey?

Mark Johnson 11:36

Yeah, um, you think, you know, in San Francisco in particular, there's sort of like this wonder for the future. And I say San Francisco, New the entire Bay Area, right? Remember, Silicon Valley is, is the South Bay originally. And people come there, like I came there in the 90s. Because I was a misfit in my own town, right? Like I like to read, I liked, you know, reading weird books, I like playing with computers. And I was really hopeful about science in the future. And it turns out, lots of people moved to the Bay Area. Because of that. It means there is a culture of helping people, right, like, doing interviews for people is now something I'm honored to be called on to do. In my early days, I was helped by so many friends and mentors to give me early introduction, that's just what you do in the valley. I don't think people appreciate the the concentration of talent, and all the interactions, that that creates in a place like San Francisco, it's very, very hard to replicate elsewhere. Like when we came to New Mexico, the reality was that we had to import a lot of talent into the company, because it's, it's just not there. Like a lot of the talent that would have gotten gone into computer science ended up going somewhere else to go study computer science, and then stayed there. So there's not a lot of latent talent there. The people that chose to stay at Los Alamos, right, you're, you're going to Los Alamos, because you're probably at the top of your science career, you're going to spend 2530 years there, get a nice salary, a nice pension, you're almost by definition, very risk adverse. It's a great job and your service of the company country is, is welcome. But like that's not the kind of person necessarily that's going to be at a startup. Same thing with Omaha, when I went and did the Ag tech company, right? There's just not a huge concentration of talent here. I think, to me, this is what's really missed in in when people talk about the death of San Francisco, the reality is that there is a concentration and a culture there that is very hard to replicate elsewhere.

Will Jarvis 13:32

Yeah, I definitely think that is absolutely the case that collaboration effects I think, are still actually perhaps underrated. Just going back, you know, seeing everyone in Hayes Valley, I'm walking around, and I'm connecting, you know, ever I see, you know, someone that's been on this podcast, you know, once every, like, two hours walking around Hayes Valley in San Francisco, and it's a bit of a leading indicator that perhaps is the right place to be, I'm not sure or maybe not, maybe you should avoid it. But it's, it is interesting how, you know, the the concentration of talent, despite the fact that San Francisco is quite honestly a little bit unlivable. You know, from a perspective of, you know, just crime and, you know, housing prices just being so out of control, that it actually, you know, it would be difficult, I think, for us to do what we're doing with it without paying a lot more in salary early on. Yeah, I mean,

Mark Johnson 14:23

these are issues that I frankly, is one of the reasons I moved into the nonprofit world is that, you know, I spent, you know, my 30s really selfish and I'm walking through South of Market to my office, I always used to walk and I'd be like, when is someone going to solve these problems? And it's really weird for someone who has a libertarian focus to wonder when the government is going to do something. And frankly, the shame on the government of San Francisco for abandoning so many homeless people abandoning the youth with their terrible schools abandoning groups in San Francisco, particularly minority groups in terms of just their, their their general personal safety, like shame on the government of San Francisco, I don't think we should look to the government of San Francisco is the solution. There are plenty of really smart people that live in San Francisco with more means than any other city in America, surely they can come together in this sort of Third Sector, the independent sector, and try to solve some of these issues, I'm confident that with the creativity and talent that they apply in looking at technology, and matching that to business problems, I am certain they can go look at technology and other tools available to them, and apply that to social problems. And frankly, I'd call them them go do it, right, like I came into the social sector. Exactly. Because I saw this gap. And I just wish San Franciscans would really step up around this.

Will Jarvis 15:50

Yeah, I definitely think that there needs to be a call for more people who are, you know, look up and say, Hey, like, maybe it is my, my duty to help here and being a citizen, and perhaps just generally, that's, that's more of a bottom up approach that we could encourage is for everyone to think more closely about how can I help my community, you know, flourish? And not just how can I help myself flourish? But it's difficult to, you know, impart that message to

Mark Johnson 16:11

people? Yeah, I mean, it's like, it's

Will Jarvis 16:12

easy to point the finger. It is it is it is, I want to talk more about, you know, some of these bottom up solutions to a lot of American social problems. You know, it seemed together, you guys are doing a lot of good work on trying to encourage this around zoning around, you know, loosening kind of occupational licensure and a lot of things like that. And tell me if I misspeak on any of these fronts? What do you think the biggest lever is that you guys have on the policy arena, to encourage, you know, personal responsibility, or the ability for people to kind of take charge and help themselves out of some of these sticky wickets? We've gotten into as kind of a culture and society?

Mark Johnson 16:51

Well, I think, you know, one of the things we look for, in the organizations that we support, is that they start off with empowering people. Right? I think that this means that, you know, not just like, how are we going to live a better day or week? But how are how are they going to help people to live a better life? Right? How are they going to find life's of meaning? How are they going to become self actualized. And that's a key thing that we look for, you know, one of the ways you do that is by helping people are recognizing that everyone is an individual. And then you can't just use a template for helping them out of whatever situation they're in. So let me just give you a few examples. Like the Phoenix is one of my favorites, they, they focus on people with substance use disorder, introducing them to sort of athletics as a way to build a community around them for supporting, and it's truly incredible, they built many gyms, you know, started off from a founder that was close to the problem, something else that we look for is like, much like you look for passionate founders in technology, who are obsessed with the problem. Oftentimes, the best proud founders in the social sector, are those that were closest to the problem also. So they you know, they've taken this model, it's, they've been able to scale it up. It's been a great, great collaboration with them. And recently, there's a technology component now to where they've started to build an app to build an offline community. So unlike gyms, which are very expensive and tied to a location, you can set up sort of fitness schedule anywhere and give support to people no matter where they are on their phone. This becomes a powerful new tool. So I think that you know, a few lessons here is, you know, how do you empower people? How do we find organizations that are founder led, where they really understand the problem? Do they have a novel solution to one of these sticky wickets, as you said? And then can we find ways to scale them up? Like if this solution is working? Well? What ways can we use technology and other tools to help them scale up? And that's sort of generally what we're looking for as a community when we find an organization to support?

Will Jarvis 18:59

That's great. That's great. And I do love the focus on technology. And philanthropy seems to be like, that's something an underserved area that has a lot of kind of alpha left.

Mark Johnson 19:10

Yeah, I mean, I think one of the mental models that I've tried to break in my head over the past year is this nonprofit thing, right? Like, what is a nonprofit nonprofit is a tax designation and nothing else, right? At the end of the day, all these organizations are creating products that serve their customers, and help them live better lives. And when you think of it like that, you realize that there has to be a business model there. Sometimes donations are the right business model. Sometimes there's another kind of business model. So one thing that's really unique about Stan together is we're also pretty agnostic to the type of organization only that the organization is really helping people in their lives. So for example, we have a venture fund. So stand together ventures labs invest in for profit organizations. And what's cool about it is maybe two things one is He will often look at deals that other VCs would pass by because they can't see the billion dollar opportunity. He's that connects to the second point that? Sure, would we like a financial return out of that it'd be great if we did. But really what we're going for is a social social return, the financial return is just validation of that product. And showing that began a sustainable business model and get the product or service into the hands of the people that needed the most. But really, we're looking for that social good, right? Like, how can the portfolio companies create social equity, not just capital for us?

Will Jarvis 20:36

That's great. That's great. This is this question is somewhat related to this. And you might have answered it already. Recently, I was talking to someone who worked in philanthropy for something like 20 years, when started their own nonprofit. And he was complaining to me one of the problems he had, he was an advisor to a very wealthy person who had made some money in natural resources. And one of the problems he had, he's a very smart guy was that, you know, a lot of people in philanthropy want to find things that are under served or, and also, you know, somewhat something someone else has not done yet. So they can get that kind of excess return of good or utility in the world. One of the problems he had though, was, you can find these people, but then you know, you've got to keep supporting them for the long term if you want them to be successful. And there's kind of this drive, I feel like in a lot of a lot of, you know, context to get people to something that kind of self sustaining knowledge there were oftentimes you can have underserved or problems that are overlooked. But if you find them, you're almost kind of committing to finding them for a long time, because by definition, other people have overlooked them or thought they're not important.

Mark Johnson 21:45

Mmm, that's an interesting perspective. Again, I'm, I'm kind of an outsider to this market. And, you know, given my sort of very venture focus lens, I'll give you that lens. Too many philanthropies are around for too long, they do too little period. And I would love to see like no use business terms here. I'd love to see more consolidation in the budget. Yeah, I'd love to see better data driven decisions, right? Like, rather than trying to like, I'm sorry, there's just not that many problems, like what are the problems we all care about, we care that people are educated that they have good jobs, that you know, their children are growing up healthy and happy, their children are well educated, right? Like, these are all the standard prompts, that when someone falls in society, there's a place that we can help them. These are the same problems that have resonated with with humans for probably 1000s of years. So I really don't think there's that many new problems out there. Go instead of starting something new, go find an organization that already exists. I really encourage people to do that. When you do find one, really understand how they're changing people's lives, not how they're just a point solution for today, but how they're really changing lives to the long term. Also look at how are they using data? Are they really talking to their customers, or their donors, their customers, or the people that are serving their customers, there are just far too many philanthropies that treat their donors as customers, because that's where the revenue comes from, rather than the people that they're serving as customers. So I really think that there is there's hopefully, you know, a sea change coming in philanthropy, we're far more customer focused, we're far more data centric. And we're far better at sort of leveraging the principles of in business to, to go help people live better lives.

Will Jarvis 23:34

So just less navel gazing overall, and more just focus on on the ground, like, how do we actually help people perhaps?

Mark Johnson 23:40

Yeah, no, no, and I'm not trying to be heartless here, I think quite the opposite. Right? I think that I think that, like, it's just really important that we, again, this this sort of focus on the customer is something that's really often lost in philanthropy. And, you know, I think that I want to see more people come into this sector, and more novel ideas. But like, also recognize that there's a lot of organizations out there right now that may be doing the kinds of things that they already care about. So it's worthwhile, it's worthwhile taking a step back and understanding before you just jump right in,

Will Jarvis 24:14

kind of take the outside view there that perhaps, you know, perhaps everyone's not not, you know, off the rocker there, they're already on to something and, and then go from there to try and try and improve things. For sure. That's great. That's great. You wrote a piece about kind of a post mortem on Descartes Labs, which was incredibly helpful to me, I think, in framing my thinking about how to build, you know, a business that's kind of related to data, and some of the pitfalls that can happen when you're trying to do that, you know, as a young new founder, what's the one piece of advice that you would give me to try and avoid a lot of heartache as I build this kind of data business?

Mark Johnson 24:50

Ah, I mean, there are many I think at your stage, it's just make sure you have product market fit, and don't fool yourself. Gotcha. Uh, you know, I think that, you know, one of the things that we committed to Descartes Labs is we had some really early or early customer success. And we are investors, we pat ourselves on our back and just assume that we were doing something right there. And the reality was that we didn't have something that was scalable, right, they say, nail before you scale it, and too many companies have spent way too much money, trying to scale something before they really, really found that product market fit. So that's the number one piece of advice is just make sure it makes sure that you found that.

Will Jarvis 25:35

So be sure that you can, that you've executed well, and you've got product market fit before you go and, and put gas on the fire, if that makes sense.

Mark Johnson 25:44

Yeah, and, you know, the road defining that is really hard. Right? So, you know, another sort of mistake that we made at Descartes Labs was, you know, we were really a glorified consulting business. And the thing that like, it's so easy to point fingers and say, oh, you know, you've made a big mistake doing that, like, literally, that's how all enterprise software companies start. Right is yes. It's so true. Yes, absolutely. Right. Like you're, you're, you're in there solving a really particular problem for someone praying that other people have that problem to maybe get some a little bit of evidence that other people have that problem. Maybe you have a thesis that people have that problem, then you go try to find them. But the reality is that a lot of your early solutions are going to be highly custom. And that's okay. The problem is, if five years in all of your solutions are still custom, you do not have a scalable software business with high gross margins, you have a consulting business with low multiples and much lower gross margins. And that's just a very, very different business to be in. And it's probably not what your investors signed up for? Well, and

Will Jarvis 26:48

it seems like it's one of the challenges, it's very difficult to tell early on, like you said, you know, you've got to do things that don't scale to quote Paul Graham, but that inherently implies more of like a consulting esque approach. And so you're just trying to first make someone happy and then see, okay, is this repeatable? And you've got to kind of do both. And sometimes, like, you get there, and sometimes you don't?

Mark Johnson 27:09

Yeah, and I think this is where it's so funny. Like when you write something like this, people's comments on Twitter are sort of like these like, tiny little aphorisms that sort of tried to be pieces of wisdom or point out all the flaws. It's like, of course, we thought about a lot of that while we were doing it, it's just Hindsight is 2020. Let me paint you just a quick picture of that company for people that don't know about it. So spin out of Los Alamos, it was me and number of scientists that came from Los Alamos, the expertise was in big data supercomputing, AI, and particularly satellite imagery, so complex datasets. So what we did is we apply this to large global datasets, initially looking at agriculture. So basically, the things you can see from the sky typically are large, they don't move, we successfully applied in agriculture, particularly looking at global corn and soybean yields. So how much corn and soy is growing at any given time on the planet, it's a really important number, if that's one of your inputs, or if you're trading it, or if you're a farmer. So those those kinds of numbers are quite useful. We had something that's pretty accurate. And that's how we started off the company. The big problem we had was, we weren't sure what kind of product we ultimately wanted to build. So our biggest deals were large consulting deals. But the question was, were we going to do more custom consulting deals? Where were you going to sell the platform itself? Right? Are we going to sell our scientists, we're using this platform that access to petabytes of data, and can use it to build these very valuable models for our clients custom? Should we sell the clients those that platform? Or maybe a third option is Do you sell products on top of that platform? So call it predictive feeds that sit on top of that product platform that are fed by satellite imagery? And this was what I call in the post the Descartes Labs dialectic? Which was, are we a platform company? Or are we a consulting company? Are we a software company or consulting company, and that really define sort of the history of the company and in both the things that we did really well? And where we sort of tripped and fell?

Will Jarvis 29:18

That makes sense? That makes sense. Do you think, and we don't have to talk about this too much. I know like these things are not like fun to talk about in retrospect. But I think it's very quite helpful for folks to learn about this. And just like how these businesses unfold, like, you don't I mean, like, there's all kinds of different ways to go. And I mean, you still exited the company. It's not like it maybe wasn't the exit you wanted, but it's still the company still exited. I'm curious, do you think you would be would have been better off just picking one like, we're gonna be consulting shop, or we're gonna like try and just burn the boats and build a platform or is it like, I mean, hindsight is 2020 Right. You guys were optimized, but you could get a ton of really smart people so it's not like you know, there's a reason you guys did all that right?

Mark Johnson 29:57

Yeah, I would say we mean that let me be a boy. Look down to two fundamental mistakes. So one is, I think that we should have been honest with ourselves that we were a high end consulting company. And there was plenty of money being thrown around at that time to organizations like ours that had that kind of talent pool that could build really valuable models. So I wish we would have done that maybe like even even further back, I think we should have just created a hedge fund, because we've all been very rich if we did that, but I think that we were just honest with ourselves and our investors that we were a consulting company, it wouldn't change how we grew, we could have said, Hey, a product me come out of this. But I think we can grow steadily year over year, we would focus on the gross margins of every deal, right? Like make, it makes sure every deal had margin rather than sort of the promise of future revenue. And we just want the financial engineering for the company would have been totally different. Honestly, the other mistake we made is getting way too hung up on the data set. So like we did some stuff with satellite imagery that at the time was crazy, remarkable, right? Like one of the first things we did in the first six months was to process a petabyte of data in under 24 hours on Google Cloud using 30,000 processors. Google had never heard of that before. They told us it was the largest calculation ever run on Google Cloud outside of Google at the time. So we became real buddies with them. But then we got all excited about it's like, oh, what can we do with satellite imagery? Look at how big our data sets is, when we were saying to the VCs, look at how big your data sets is, give us some money or customers the same thing. What they all should have been hearing is while you're burning a lot of cash, because you're storing petabytes of data, and doing enormous amounts of cute compute, is that really valuable. And there's probably a post to be written here too. But I don't think there are a lot of commercial use cases for geospatial data, such that the cost of manipulating the data, acquiring the data cleaning the data is greater than the alternatives that exist. And that's something that like was proven to us over and over and time and time again, the reality is people wanted to buy or sell signal for corn, they didn't want to see pictures of corn. And that was one of the fundamental mistakes we made in that company, for sure. That makes sense. Don't get obsessed with the data. Right? Yeah, it can be very attractive. And it's interesting, right? You're

Will Jarvis 32:23

getting a lot of applause as well, right? You talk to Google, he talked to the Google sales rep. He's like Holy mackerel, you know, no one's spent this much cash on us before. This is the biggest, you know, compute ever done on our system, you know, and all this stuff, and customers get excited about it. But perhaps the utility isn't isn't always there. But it's a real challenge to kind of navigate that. Well, Mark. So I'm curious. So you've, you've worked in the private sector, you've worked in the public sector, you've kind of you've been across the kind of domains here, I am curious, how is it different running a, you know, a startup versus running kind of a big philanthropy? Or are they pretty similar at the end of the day, with regards to how they operate?

Mark Johnson 33:05

I mean, look, there's always, there's always going to be differences in how organizations are managed, particularly on based on their size and how long they've been around. So we've been around for long enough that we're more stable in a startup. That being said, one of the reasons that I'm here is that we focus on constant creative destruction. So our founder, founder, Charles Koch, one of his biggest fears, and they'll say this directly is, is entropy, right? That systems that don't have injections of energy, tend towards boringness and will eventually get disrupted. So if, if you believe that someone outside of you is going to disrupt you, if you don't do anything different, you darn well better do something different. It's something I really appreciate about being part of stand together is that, you know, we're constantly challenged here to think bigger. We're constantly challenged to think about how we might do things better. And we're constantly challenged about how we might do things differently. So it's still like, based on those core principles we have that are how we run the organization. But luckily, we didn't have a VC a few years ago. Now we do it started off as an experiment. We've made almost 20 investments now. And now it's becoming a larger part of the organization because the experiment was very successful. You know, that I think that's probably I am blessed, because I think that's pretty atypical for your typical nonprofit in DC.

Will Jarvis 34:37

Yeah, no doubt, no doubt. And I'm curious, how do you keep that pressure up from a leadership angle? When there aren't, you know, in startups, like there, there's the market forces in you know, philanthropy, you know, those can be less How do you keep the pressure up when there's less kind of evolutionary kind of, I guess, pressure on the organization to be kind of successful?

Mark Johnson 34:59

Well, I Yeah, I would say, I feel like we feel a lot of pressure here. Because look at the world around us, right? Like, if you're looking around the world in 2023, and saying, Well, this is the best week in America, like, I don't think you're paying a lot of attention. So like, I think we actually feel a lot of pressure. Like one of the reasons that I came here is I thought, If not now, when, right, they have the right set of experiences for kind of this first half of my career, where I learned a lot in startups and technology and big companies and sort of like how the business world works, and how we can apply technology to big problems, I wanted to try this in a new domain, that domain being America and some of the problems that that she's got right now. So I don't know, I feel like we feel a lot of pressure here, even though it'd be easy to sit back and be sort of, you know, be sort of staid and boring. But we're just not like that at all be the the one other thing I'd say is that we run on a management system here called principle based management. And the easiest way I found to describe it is it's a kind of, it's a management system for let's call it self organizing organizations. So the same principles of you know, believing in people and empowering people, bottom up solutions over top down solutions, those the same kind of principles that are embodied in our management system. And that really tries to push down decisions to the people closest to the problem, really empower people within the organization, be really clear about our vision. And I think that helps us to stay really nimble, too, even though it was inspired by, by, again, the management system, Koch Industries, I think we've adapted it in such a way that it keeps us very nimble and very creative. And frankly, Koch Industries is an excellent, excellent model itself, you know, having grown from a small oil gathering business back in the 60s, when Charles took it over to the one of the largest privately held companies in the world today.

Will Jarvis 36:59

That's great. Can you talk more about that kind of management system, and perhaps how that works, like on a kind of day to day basis?

Mark Johnson 37:05

Yeah, so I, honestly, it's one of the greatest gifts that I've gotten from Stan together is a deep understanding of principle based management. So the principle principles in principles based management are the principles of human progress. So sort of like the thinking of it as sort of like the basic things in the Declaration of Independence, Life, Liberty, liberty, and the pursuit of happiness, along with a bunch of concepts from psychology and economics that Charles picked up over the years. So that's sort of like the basis, what this has been distilled into, is we call the five dimensions of principle based management, we sort of define how an organization works. So it's how do you set vision? You know, how do you find the right people? How do you make sure that they're motivated, empowered, how do you make sure knowledge is flying to the organization at the right rate, so that people can make the right kinds of decisions. So these are the five dimensions and sort of like how we cohere as, as an organization. What this does for us is, again, it tries to empower every individual by like, for example, here, you write your own job description, right? Your roles, responsibilities, and expectations are something that you work out with your supervisor, what those are going to be, which I found very, very empowering here, because it encouraged you to think about what you do best and how you can contribute most to the organization. So like me, this is a really long way of saying it's a very, very thinking heavy system, and that it forces everybody in the organization, never shared language forces, never have forces in in principle based management, and encouraged everybody in the organization to have the same language and to feel individually empowered to to take control of their situation, and make the maximum amount of impact they can. So I just found this to be really powerful and a framework that I've been able to apply not just at work, but in life more generally.

Will Jarvis 39:04

That's great. Do you think more organizations should adopt a management style like this?

Mark Johnson 39:09

Absolutely. Like I will, like, I'll be very bold here. I think this is potentially a leap forward in management. If you look at sort of the history of management sort of, and how it came about, you know, there's this period of let's call it Taylorism. That's very top down, we tell people what to do. We're really clear about job descriptions. You get into systems like total quality management that are all about product efficiency and charts and making sure people follow rules to get good efficient products. These were all sort of leap forward and management that allowed us to get the modern corporation. But this idea of empowering all the individuals in the organization is extremely powerful. And I think what you get is more flexible organizations, right? So this idea of that organization and being able to self organize based on the individuals within that organization is something that, that, frankly, not only have I not seen, but I've not done. I mean, to a certain extent, if I look at some of the other startups that that I've run, you know, I did a little bit through tyranny, which is funny because my politics are definitely anti tyranny, anti top down, and a lot of how I managed was very top down. And now I have a framework for better empowering people based on their talents for selecting people based on on their talents that I never had before. So now at some point, there's probably a piece to be written here too, about kind of what I've learned from from principle based management, I really encourage everyone to check it out. It's a, I'm pretty sure it's principle based You can download some booklets there, Charles has written a few really good books. And if you're interested, please do reach out to me, because like, I'm really passionate about this, I'd like to see, I'd like to see more startup founders think about management, as a discipline earlier in their startup career, he said he would really benefit them, it would have really benefited me. But thank God, as anybody who's been managed by me over the past few decades would say the same

Will Jarvis 41:13

thing. If you had to give one piece of management advice to you know, a young founder, you might be talking to right now, what would that be? Like? How can we do it better?

Mark Johnson 41:23

Ah, spend more time listening and less time talking. I have a lot. I mean, as you probably tell from this podcast, I have a lot of trouble with that. It's not necessary advice I always follow. But you can learn so much from people in your organization, you have to remember, you are not close to most problems. The people on your team are close to those problems. And either you trust them to give you good advice. And if you don't trust them, the right solution is not to get in there and do their work for them. They might not be the right person for that role. So really trusting people and listening to them is something that I wish I would have learned far earlier in life.

Will Jarvis 42:02

Make sense? That's really good advice. That's great. Well, Mark, thank you so much for taking the time to come on the show. If people are interested in this conversation and other things we popped up, I'll put some show notes in the in the dark down there with links for everything we mentioned. But where can people find you? Where should we send them?

Mark Johnson 42:21

I'm philosophy geek pretty much anywhere. Check out my Twitter, my medium. Those are probably my two primary ways that I get things out there. So yeah, look for me at philosophy Geek on Twitter.

Will Jarvis 42:35

Awesome. Thanks so much, Mark. Awesome. Thank you well. Special thanks to our sponsor does market analysis for the support. Bismarck analysis creates the Bismarck brief, a newsletter about intelligence grade analysis of key industries, organizations and live players. You can subscribe to Bismarck free at brief dot Bismarck Thanks for listening. We'll be back next week with a new episode of narratives. Special thanks to Donovan Dorrance, our audio editor. You can check out documents work in music at Donovan

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Narratives is a project exploring the ways in which the world is better than it has been, the ways that it is worse, and the paths toward making a better, more definite future.
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