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Freakonomics Radio

482. Is Venture Capital the Secret Sauce of the American Economy?

Freakonomics Radio

Freakonomics Radio + Stitcher

Documentary, Society & Culture

4.632K Ratings

🗓️ 11 November 2021

⏱️ 46 minutes

🧾️ Download transcript

Summary

The U.S. is home to seven of the world’s 10 biggest companies. How did that happen? The answer may come down to two little letters: V.C. Is venture capital good for society, or does it just help the rich get richer? Stephen Dubner invests the time to find out.

Transcript

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0:00.0

I was 16 in India when I heard about, in fact, red in a two-year-old magazine that I used

0:10.1

to rent once they were old, they came to India and you could rent them for the weekend.

0:14.6

That indigrow, a Hungarian immigrant had come to Silicon Valley and started intel.

0:21.6

So that became a dream for me if that immigrant can do it, why can't I?

0:27.6

But didn't you start a soy milk company in Delhi?

0:31.2

I did try and start a soy milk company, I never got it started.

0:36.4

There was never any funding available.

0:38.8

There wasn't an entrepreneurial culture there.

0:42.0

And I still remember vividly, I called the phone company and they said seven years to get

0:47.0

a phone line.

0:48.5

I said, I'm coming to Silicon Valley.

0:55.1

This Vinod Kostla, he did come to Silicon Valley and in 1982 he co-founded the technology firm's

1:01.3

Sun Microsystems.

1:03.1

Today he runs one of the biggest venture capital firms in the US and therefore one of the

1:08.5

biggest VC firms in the world.

1:10.5

It's called Kostla Ventures.

1:12.8

Since 2004 it has invested in nearly 1000 startup companies.

1:18.4

Kostla often invests in little more than an idea.

1:21.6

Pat Brown was a professor at Stanford and he came to us and said, I want to change animal

1:26.6

husbandry on the planet.

1:28.5

That was his entire pitch.

1:30.5

Pat Brown was a very well regarded biomedical researcher.

...

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