From Rave Promoter to Psychedelic VC: Empathy, Innovation, and Social Impact in Tech

Ram Ahluwalia & David Nikzad

Thank you for Listening this Episode!

Support our podcast by spreading the word to new listeners. We deeply appreciate your support!

Episode Description

Investing as Surfing : YC, AI & Crypto In this episode we chat with David Nikzad, CEO of Orthogonal Global Group.

Episode Transcript

[00:00:00] All right. I am thrilled to have David Nixa join us today on non consensus investing. David and I met in Dubai about a month ago at a Satoshi Roundtable conference. And David's really got an incredible background. He started as a club and rave promoter in DC, and that's where he learned how to spend a dollar to make 10.

And really great experience for guests. And then he went to Silicon Valley where he became a VC at Y Combinator, invested in a number of unicorns, including Airbnb. And today he's the founder of a venture firm, we'll learn more about that's investing in pharmaceutical products. Including using naturally grown psychedelics to treat mental health concerns.

So we got so much to talk about here from what does investing have to do with surfing? He's got a framework I find really quite interesting. We'll talk about [00:01:00] AI, crypto, his experience with Sam Altman psychedelics. Venture capital, the state of venture longevity and wellness and also his story too.

So we're going to have a lot of fun. Dave, first off thanks for joining us. I know you're not, where are you today? Where in the world are you? First of all, I am actually still in Dubai and on our way to Thailand tomorrow. And I think there's an excitement in the air with the whole crypto bull run, or, yeah, as I said to you earlier, there's a convergence of a lot of things that we've worked on for, I would say, over a decade, maybe 14, 15 years, that are, I think, just coming together simultaneously, just because I always say, you gotta plant the seeds, and then, they start growing, and I think a lot of people forget as quick, as fast as crypto is, many of these things that are now blooming are 10 [00:02:00] to 15 years old.

That's right. It's the 15 year overnight success story. You don't see the hard grit, especially Like your investment in Airbnb, classic example. They had to raise revenue by selling, branded cereal at political conventions. And now you've got a massive public company. So let's zoom out for a second and talk about surfing and investing.

What's the connection? It's interesting. I was actually chatting with a gentleman this morning, that's a former SoftBank individual or former SoftBank investor. Living in Dubai, and we were talking about the ebbs and flows of life, and, similar to the waves, the waves come in and out, it's high tide, low tide, and then, sometimes the waves are big, sometimes they're small, but there, there's a rhythm to all of it, and I think that because it's a pretty exciting conversation.

I started investing very early, probably 27, 28 years ago. [00:03:00] I don't really get too emotional about what I would call when the waves are consolidated or there are no waves. There are days that we paddle out and it's just talking story on our surfboards and we're catching little waves. But I think at the end of the day, you have to have your equipment ready for when the waves are big, and I think that for all of us that have been in psychedelics, or crowdfunding, or crypto, or, space, or deep tech there was definitely a consolidation the last two years, yes.

Did open AI and machine learning do well, and robotics did well? Yeah, there were certain sectors that did really well, but It was the element of knowing that we invested in founders and companies that this was a longitudinal journey. And as you'll find out when you surf over the decades, obviously you become better, you understand the [00:04:00] channels, the way you paddle out into the big surf, and it's very similar to investing.

I, I fully agree. Look, if you're looking at a secular trend, and you're anticipating one, that's another way of saying we're waiting for the big waves. We're going to ride the wave. We are big wave riding right now, and what I would say The token and bitcoin, but listen we always say in Hawaii, the third wave is it's always the one, it's like the, it's the bigger one, it's coming through, it's not doubled up, and I would say if you look at, let's just call it the ICO or IDO market, we're in the third wave.

And I think that everybody has brought their guns, as we would call it, in surfing, they've brought their boards, they've been working on these boards, and now they're ready to launch. And yeah, that's the similarities when it comes to surfing. I love the third wave metaphor too, we should double click briefly on that.

I see this across asset [00:05:00] classes, you see it, for example, in biotech, you had Craig Venter in the 2000s, he had a big bubble there, didn't go anywhere. The hype exceeded the substance and yet another biotech boom five years ago, now with the third wave in biotech and real estate, the same thing happens to you.

So the first person who acquires a property, a multi family or CRE, they overdid, they have aggressive rent moral assumptions, aggressive financing costs, they get the wrong financing. Then the second one, they put too much capex in, they blow out. And then the third person, these are just rules of thumb, not saying old deals are like this, but it's just a way to think about.

Markets and investing. The third person, they get in there, they get it below replacement costs. We'll get the right fixed term rate financing and it works out. So today you're seeing a convergence of a number of these waves and you touched on quite a few of them from deep tech to space X, to crypto, to AI.

How do you, to psychedelics, what are the ways that you're most excited about today? I'm [00:06:00] excited about all of it. I think at the end of the day, I don't like to get into this specific, what I would call metric, but we're going to talk about it because I think it makes a lot of sense.

Right now in the United States you're noticing that 30 to 40 percent of people that live in the U. S. don't believe in religion. I think looking at that at a global level, this idea of religion, which is essentially a community, We've all shifted what is our own religion, and I don't like to use this in a, what I would call an occult type narrative, but the people, we're living in a world today where there's so much access to information, that as long as you follow the letter of the law, you're going to find those people that are part of your tribe or your community.

And I think that. The idea of liquidity through crypto and the idea of [00:07:00] SPVs and crowdfunding and IDOs, everything has just shifted where you now have these telegram groups and discord channels and You just, you find your tribe. I'm part of this Telegram channel, which is what I would say 200 crypto OGs.

And we essentially are all into the same thing. We all like longevity products like NAD. We like psychedelics, we like cannabis, we love crypto. In general, to use that word religion, What we're finding now with a lot of people is, you're, this idea of religion is coming into what turns you on what is it, who do you want to spend time with day to day, and again, I don't want to get into your personal business, but I'm sure it's like that with the people you hang out with.

No question about it, you're absolutely right, look, ESG was a religion, that's a tribalism, Elon Musk is, runs his church. Of Tesla and open AI. And there are religions and tribes. They're all [00:08:00] bubbles of different kinds. You mean closed AI? Closed AI. Yes. We're going to get back to that too.

We got so many exciting topics to get done here. No look means are shared beliefs and shared values. And we convert some legitimacy to that based on a group, because you and I say it is worth something. And sometimes that's in a monetary form, sometimes an aesthetic form. Sometimes it's in an immaterial form, and I agree on the NAD too, and there are interesting overlaps between these tribes.

Let's talk about crypto. Let's go there now. Look, we've got all time highs in bitcoin. Now, what's notable is that it took place before the halvening. That hasn't happened before. And we're also seeing this similar phenomenon, I'd argue, in equity markets, where you had relatively short, six to seven month bear market, And then 12 15 months, you're at all time highs again.

And, part of this is you have a number of narratives. One of the narratives is certainly the AI [00:09:00] narrative. And where do you see where we are in crypto relative to the cycle? And what is the, Acceleration of crypto and the recovery of crypto this quickly to all time highs ahead of the halvening.

It was going to happen. At the end of the day I, one thing that drives me a little bit crazy about, getting on something like AXIS, all the people that, get into what I would call subjective fear based conversation. Anybody, everybody knew that with the people that were involved with the ETF, it was going to happen.

So I think at the end of the day, if you didn't, Ride that cycle or narrative into where the price is today, you obviously have no business being in the space. And I don't say that in, in any bad way, but it's similar to surfing. You don't arrive in Hawaii and decide you're gonna paddle out in a place that's that's breaking three feet with a reef, and it's like head high.

You're gonna, you're gonna get killed. At the [00:10:00] end of the day, everything that happened, even with the SCC, the fake tweet with the SCC where people got wiped out, that was all part of what I would call this the matrix of this sort of pixelated journey. I look at everything, from the lens of quantum physics and quantum chemistry, and especially when you take psychedelics and pathogens, you're going to see those atomic Very nano particles of what's going on.

So yes, if you were running 10X leverage or a hundred X leverage, you were going to get knocked out of the game. So I think at the end of the day individuals or people that had experience that had surfed these waves before understood what was going to happen. And I think the beautiful part about the UAE is it was prepared for that.

When we were sitting at Satoshi. You could feel the momentum [00:11:00] happening. And I think at this point, when I get into subjective conversations with, people on Twitter, I'll do Twitter spaces, Listen, Bitcoin's going to hit a hundred and some thousand dollars it might even hit a multi hundred thousand dollar price level, but that's where we are in the market.

I always like to go back to the story of Tesla. Tesla originally was an RTO. It started trading at around a dollar. So at the end of the day, that was a longitudinal journey for Tesla to where it is today. It's also a conglomerate of companies. That's where bitcoin and what I would say the sub layers of crypto are today.

The conversations that I have today with people are banking rails, on ramps, off ramps, globally. How are, there are people that I meet every day that live their life without a bank account. They are using crypto for [00:12:00] everyday expenses and they live in that digital world. So when you're at a level today where you see at some point Bitcoin is going to have a 2 trillion dollar market cap on its own, that price is going to compound.

And, that's just where we are at now. We were hitting what I would call critical mass. What do you make of the fact that we hit all time highs before the halvening? And similarly, in equity markets, we're seeing acceleration, credit spreads are, are tight, wherever you look full evaluation, number 21, P E ratio, etc.

Again, I don't want to age you and I would say number one, you're a lot smarter than I am. I saw that at Satoshi. Not really. I would say, You knew, if you were, if there were very sophisticated individuals building out these ETFs and the people that were involved with them Mike Novogratz and [00:13:00] BlackRock and, Cathy, these people have analysts and people that are studying these products And saying to themselves, okay, this is when they need to launch and this is what needs to happen at that time.