Chris Paik - Venture Investing Frameworks

**Patrick O'Shaughnessy** (0:00)
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Hello and welcome everyone. I'm Patrick O'Shaughnessy and this is Invest Like the Best. This show is an open-ended exploration of markets, ideas, stories and strategies that will help you better invest both your time and your money. Invest Like the Best is part of the Colossus family of podcasts and you can access all our podcasts, including edited transcripts, show notes and other resources to keep learning at joincolossus.com.

**SPEAKER_2** (1:53)
Patrick O'Shaughnessy is the CEO and founding partner of PositiveSum and the CEO of O'Shaughnessy Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of PositiveSum or O'Shaughnessy Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.
Clients of PositiveSum or O'Shaughnessy Asset Management may maintain positions in the securities discussed in this podcast.

**Patrick O'Shaughnessy** (2:25)
My guest today is Chris Paik, who is a general partner at early stage venture firm, Pace Capital. Before Pace, Chris actually spent eight years building and investing alongside last week's guest, Josh Kushner, at his firm, Thrive Capital. During that time, he sat on the board of Twitch.
Our conversation explores Chris' frameworks for investing, from atomic value swaps to business model product fit and the seven deadly cents. We also discuss different consumer trends like the rise of virtual YouTubers, Apple's Vision Pro, and why everyone graduates off of YouTube. Please enjoy my conversation with Chris Paik.
So Chris, I think an interesting place to start because it's something you said at lunch that I don't think I've seen you write about elsewhere, is the history of humanity as a data storage and transfer problem and how that relates to new kinds of computer interfaces. We're lucky that we've now gotten to see the latest Apple Vision Pro, which is probably figures into this discussion somewhere. What is this big idea of yours and why is it interesting for those interested in technology?

**Chris Paik** (3:24)
Let me caveat this with, it's probably in the bucket of half-baked and still in the realm of theory. In the world of audio files, there's this term called lossless, where if you are an audio file buff, you're trying to get as close to the quote unquote source or original thing as possible.
And so compression algorithms are your enemy, and it's what drives people to spend insanely ungodly sums of money on their audio setups. And I think this concept of lossless is really interesting as it pertains to data and data transfer and what are high fidelity experiences, what are low fidelity experiences, what are lossless experiences. If we think about data between humans in the same generation, data across generations, information, the ability for us to transfer information, store it and access it is so important to societal efficiency. It prevents us from reinventing the wheel time and time again. You can learn from other people's mistakes. And so one thing that's interesting to think about is songs.
Songs as a compression algorithm for data. We are wired in a certain way to feel certain tunes being catchy and we can remember song lyrics. But if you think about it, the oldest forms of songs, poems, epics were meant to transfer data between people and across generations. It's this data compression algorithm and perhaps the original form of data storage. And when we think about the advance of technology that have allowed us to create these step functions in data transfer and data storage, notably the written word, huge, huge advancement. The biggest change though, happened with the invention of the printing press because it took stored data and made it scalable to distribute. So all of a sudden there wasn't one copy of one thing. There could be an infinite number of copies or a multitude of copies of the same thing.