Season 5, Episode 5: Atari (with Nolan Bushnell)

**Nolan Bushnell** (0:00)
We'll talk during the paid portion of this podcast, where I advertise my game.

**Ben Gilbert** (0:19)
Welcome to season five, episode five of Acquired, the podcast about great technology companies and the stories behind them. I'm Ben Gilbert, and I'm the co-founder of Pioneer Square Labs, a startup studio and early stage venture fund in Seattle.

**David Rosenthal** (0:34)
And I'm David Rosenthal, and I'm a general partner at Wave Capital, an early stage venture firm focused on marketplaces based in San Francisco.

**Ben Gilbert** (0:42)
And we are your hosts. Today, we are talking about the company that invented the home video game industry, Atari, and we have someone with us who's got some pretty good stories about it. The founder of Atari, the father of the video game industry, Nolan bushnell. Hello, Nolan.

**Nolan Bushnell** (0:58)
Great to be here. Good fun.

**David Rosenthal** (1:02)
Thank you so much for joining us.

**Ben Gilbert** (1:03)
As some of our listeners know, Nolan has started a swath of other businesses, one of which awesomely is Chuck E. Cheese, which we will get much, much deeper into later this episode.

**David Rosenthal** (1:14)
We dug up some photos of young Ben last night.

**Ben Gilbert** (1:17)
Nolan, I should let you know I'm going to turn my computer around right now. Chuck E. Cheese was by far and away my favorite place in the world growing up. Mine too.

**Nolan Bushnell** (1:27)
It was designed that way.

**Ben Gilbert** (1:30)
Here's some pictures of my third birthday at Chuck E. Cheese and there's me with my favorite toy, which is a Chuck E doll.

**Nolan Bushnell** (1:36)
How fun.

**Ben Gilbert** (1:37)
Now, Nolan, this is fun timing for us and for our listeners since our last episode covered the early days of Sequoia Capital and Don Valentine's career, which you had a lot to do with.

**Nolan Bushnell** (1:48)
Well, Don was really maybe the best board member I've ever had. He was also the most frustrating and infuriating. You know, he had this ability to ask me a question about my own company that I didn't know. But the minute he asked it, I knew I should have known then. So I started to cram for board meetings saying, OK, Don's not going to catch me this time. And he always would. So I always believe that a proper, insightful question can be very instructive.

**David Rosenthal** (2:23)
Well, that was, as we covered on our last episode, Don and the Socratic Method, that was really the root of what he pioneered at Sequoia. Yeah.

**Ben Gilbert** (2:32)
Well, listeners, our last limited partner episode was a deep dive into marketplaces from an academic perspective. On this show, we often talk about the levers at play in marketplace businesses, and as you would suspect, there are experts who have spent their careers studying and categorizing things like take rate, search and discovery problem, and when to subsidize. One such expert is Ramesh Jhari, a professor at Stanford and advisor to Wave, along with Uber, Airbnb, Stitch Fix, and many other great marketplace businesses. So if you want to listen and become an acquired limited partner, you can get started with a seven-day free trial and listen right here in the podcast player of your choice by clicking the link in the show notes or going to glow.fm slash acquired. This is a great time to tell you about one of our very favorite companies, crusoe.

**David Rosenthal** (3:20)
So crusoe, as listeners know by now, is a clean compute cloud provider specifically built for AI workloads. NVIDIA is one of their major partners and literally crusoe's data centers are nothing but racks and racks of A100s and H100s. because crusoe's cloud is purpose-built for AI and run on wasted, stranded or clean energy, they can provide significantly better performance per dollar than traditional cloud providers.

**Ben Gilbert** (3:45)
Yes, we talked about that on our ACQ2 episode with crusoe CEO, Chase Lockmiller.

**David Rosenthal** (3:51)
The other element that makes crusoe special is the environmental angle. crusoe, of course, locates their data centers at stranded energy sites. So think oil flares, wind farms that can't use all the energy they generate, etc. and uses that power that would otherwise be wasted to run your AI workloads instead.

**Ben Gilbert** (4:09)
Yeah. obviously, it's a huge benefit for the environment and for customers on costs since crusoe doesn't rely on the energy grid. Energy is the second largest cost of running AI after, of course, the price you pay NVIDIA for the chips. These lower energy costs get passed on to customers.

**David Rosenthal** (4:25)
It's super cool that they can put their data centers out there in these remote locations where quote-unquote energy happens, as opposed to the other hyperscalers such as AWS, Google and Azure who need to build their data centers close to major traffic hubs where the internet happens because they are doing everything in their clouds.