Episode 7: Braintree
May 27, 2021
Growing up in a small, religious town in Utah, Bryan Johnson felt he existed in a video game where the rules were all mapped out. His favorite part of the day as a kid were the early mornings he spent wandering the fields with his dog, shooting at targets with his BB gun, which gave him a feeling of “endless possibility.”
Now he’s playing in a video game of his own making, as he puts it, that allows him to explore the “infinite expanse” of the brain and how it might be measured and shaped to help humanity thrive.
But before he could found Kernel, a neurotech company building scalable brain-recording devices, Johnson had to sell Braintree – a pioneering mobile payment platform that he took through the New Venture Challenge.
In this podcast episode, Johnson, MBA ’07, speaks with Starr Marcello, deputy dean of MBA programs at Chicago Booth and formerly executive director of the Polsky Center.
In a fascinating, at times mind-bending interview, Johnson discusses how the NVC taught him to communicate his vision for Braintree; why big ecommerce companies trusted his tiny startup with their payment platforms; and how he leads sophisticated engineering companies without being an engineer himself.
Johnson, who sold Braintree to PayPal for $800 million and used the money to start Kernel, also reveals that he rarely spends time in the present anymore as he contemplates what intelligence will look like in the future.
“For some reason, I don’t know why, I feel responsible for the year 2500,” he said.
Listen now on Apple, Spotify, Overcast, or wherever you get your podcasts.
Transcript
Bryan Johnson:
What a wonderful experience for me to discover that the clarity that I felt in my mind I could not properly convey to other people. And that so much of my success of the future would be contingent upon my ability to learn how to translate what I thought I understood in my mind so that other people could understand it in their minds. And that I could learn how other people understood it so I could improve what I thought in my mind. The New Venture Challenge offered me the very first time in my entire life I had been in a system to help me improve.
Colin Keeley:
Hello and welcome to the Polsky Center’s Where Are They Now podcast. I’m Colin Keeley, and we catch up with founders from Chicago Booth’s New Venture Challenge on the show. Join us as we dive into their entrepreneurial journeys, get a look at the stories and struggles behind their success. This week we have Bryan Johnson interviewed by Starr Marcello. Bryan is one of the most fascinating and unique entrepreneurs working today. While at Booth, Bryan founded payment processor Braintree, which bought Venmo for $26 million back in 2012 and then sold for $800 million a year later to eBay. Now, Bryan is the founder and CEO of Kernel, a company developing advanced neural interfaces. Starr Marcello is the deputy dean for MBA programs at Chicago Booth. Before the dean’s office Starr was the executive director at the Polsky Center. Without further ado, here’s Bryan Johnson and Starr Marcello.
Starr Marcello:
All right. Let’s get started. So maybe I can ask you just some softball questions just to help us get to know you a little bit better. Why don’t you tell us a little bit just about your background, where did you grow up? What was that like? Where’s Bryan from?
Bryan Johnson:
Oftentimes the way someone explains where they’re from and how they grew up says more about them than the actual circumstances in which they grew up and where they’re from. And I’m aware of that as I’m contemplating this question in the perspective of who I am now. But through my recollection, I grew up in a small town in Utah. My grandfather had several horses, and we farmed hay, alfalfa, and corn. And we stayed up all night to do irrigation. We built cabins up in the mountains and we did big bonfires and cooked hot dogs. So I really spent most of my time outdoors building tree houses. And my grandfather was perhaps the most significant influence in my life because my parents had divorced when I was young, and he stepped in and spent a lot of time with me.
Bryan Johnson:
He had grown up in the depression and had a certain way of understanding the world, which translated into hard work and persistence. And so I guess I look back that I grew up in a small town, was outdoors and was with a man that valued hard work and industriousness overall, and honesty and just being a good person. I think those are probably the things that carried over most of my life than other details of my upbringing.
Starr Marcello:
That’s incredible. I actually never knew that about your background and all the work that you did outdoors and your relationship with your grandfather. He sounds like he was very influential. So you probably more than perhaps anyone I’ve worked with over the past 16 years here at the school have been entrepreneurial perhaps in everything that you’ve done. Your approach to life, what I know of it. I’m wondering, just in your background, whether it was experiences you had with your grandfather or growing up. What was your first exposure to something like entrepreneurship?
Bryan Johnson:
When I was eight years old, seven years old, I started waking up at around 5:30 in the morning every day to take my dog out in the field. And I had a BB gun, and I loved to shoot targets and play around. And it was my favorite part of the day because it was just my dog and me. And we could traverse what seemed to me at the time like unlimited terrain of trees and trails and animals and little crevices. And it was this feeling of openness that we could go and do and be anything that caught my imagination. And as I grew older and I became more familiar with school and I encountered a more closed ecosystem, there were rules. You had to be there at a certain time and you could say certain things and do certain things to certain people and sit in a certain place and how to expose information in a certain structured way.
Bryan Johnson:
And I remember feeling this repulsion towards school as a contrast to my morning routine with my dog and this openness, of endless possibility as we explored. It’s now, I think I’d look at it as a pretty small area. But at the time, it just felt endless. And I would say the things I enjoy doing the most have a space that feels endless. That I enjoy the process of exploring and building and discovering more than anything.
Starr Marcello:
When you were taking these walks with your dog and spending time outdoors with your grandfather, did you think this is what I want for my future, this is the type of lifestyle, being around nature or having the openness in your life, or did you think this is the beginning, there’s something else awaiting me?
Bryan Johnson:
Your question resonates deeply because this has actually been the foremost thing on my mind lately, is I’ve been thinking back to my childhood. And as a child, I was in the moment. When I was out in the field, there was nothing more important to me than being with my dog in that moment shooting at that target or chasing down that animal. I didn’t have in the back of my mind that I needed to plan for some future thing in life. And now I think while the circumstances are similar in terms of the open space I get to explore with the things I’m doing, my mind is entirely in the future. I’m almost never in the present. I’m contemplating what existence is going to be like in the year 2500. I’m wondering in what ways those intelligences, as in whatever form they are, will look back at me and see me as primitive as I homo erectus. And I wonder how I sharpen my awareness of myself in this moment.
Bryan Johnson:
And there’s pros and cons to that. I think there’s a lot more positive neuro-transmitters that happen in being in the moment of just being blinded to nothing else matters except for this thing and I have no other worries. Whereas when I’m thinking about the future and planning out all the things I have as an adult, it maybe feels a bit more stressful and there’s a few more things to juggle. And especially when you’re thinking about timescales, and for some reason, I don’t know why, I feel responsible for the year 2500. I don’t have a passive relationship or an unattached relationship, I feel deeply connected to the future state of intelligence.
Bryan Johnson:
And it’s not like anyone asked me to do this, it’s not like they’re asking me to do it. It’s not like I’m invited to the party. It’s like I’ve just raised my hand and said, “I’m inviting myself to the party.” And so I don’t even know if I’m going to be valuable in this exercise. So it’s kind of a weird situation to try to reconcile that I’m doing something that may or may not be welcome and that may or may not be helpful. But for some reason, I’m drawn to it, and I just can’t seem to put my mind to other things.
Starr Marcello:
This might not be an easy question to answer, and perhaps there are pieces of this we can get to along the journey of our conversation. But how did you get from here to there, from being ever present in the moment to being largely preoccupied by the future?
Bryan Johnson:
Growing up in this small town, it was deeply religious. Literally every single person I knew except for my father was a member of the religion. I like to draw the analogy that I feel like I grew up in a video game where the rules of the game were all mapped out. There were points to be made, there was a scoreboard. Everybody knew what behaviors scored points, which things deducted points. People knew how you got kicked out of the game. The whole thing was structured, and therefore it eliminated all need to ask questions around, what are the rules? And as I matured and eventually left the church, then the omnipresent question in my mind has been, what game is really going on? And so I playfully say what I find to be my meaning in life is, I want to figure out what is really going on, like really, really.
Bryan Johnson:
Why does something exist versus nothing at all? And how can it be the case that time and space is potentially infinite? All the questions. And I don’t expect that I’m going to find these answers. I think that we’ve been making good progress of course in learning more and more about our reality. At the same time, I’m not certain what ratio it is. Do we know 99% of what there is to know about reality or are we at 0.0001% and we’re just at the beginning of the learning curve? And so we just have no way of knowing. But I suppose this question really is the dominant one on my mind. And so what I care about doing is that we as a society, that we are healthy and well, and we build a beautiful existence so that we can play this game trying to figure out what is really going on. And everyone else can play their own games.
Starr Marcello:
Do you find that you have a strong community of people who are obsessed with answering these questions about the future for the benefit of humanity as well? I’m asking this because so many people focus so much on what’s directly in front of them and may not have the space or the attention or the mindfulness or the knowledge to think about what’s coming in 2050. What should we be doing now? How have you found the community that is invested as deeply as you are in answering those questions about the future?
Bryan Johnson:
Yeah. I think maybe some of the most meaningful relationships that I’ve developed have been people who are no longer living, in reading what they wrote. And I find it immensely enjoyable. We of course get the advantage of we can read about someone’s entire life in a matter of a week or two weeks or three weeks, the synthesis of their thoughts. Now, maybe we don’t get all the iterations and maybe there’s details that we don’t get, but we get the gist of it in many cases of a person’s biography or their writings, and to watch their path of learning. So it’s almost like you get this compressed version of someone’s obtainment of wisdom. And that’s fun because then I can contrast it with myself and say, what could I potentially learn from this person that I may never learn on my own, or that it would take me 25 years to discover on my own through all this trial and error?
Bryan Johnson:
And then I’d say that I have several close friends who, each one has their own disposition about the future and what they care about and why. But I’d say there’s several deep connections I’ve formed with people that do maintain similar sentiments. And I think the most enjoyable ones are the ones where we just laugh at the ridiculousness of everything that we’ve achieved. We’ve reached a certain state where we just don’t take things seriously anymore, ourselves included, and that there’s this comic relief to the entire thing.
Starr Marcello:
I think at the end I’ll ask you for some of the book recommendations because I am guessing listeners will want to know what has inspired you, what have you read. But let’s get back to your story and getting to the theme of this podcast with New Venture Challenge. Can you describe your decision to pursue business school? You shared that initially school was constraining, was an opposition to the freedom of being outdoors controlling your own space. How did you end up applying to Chicago Booth?
Bryan Johnson:
Growing up in my small town of Utah, I did not know or was exposed to an engineer until I was 22 years old. Of any sort — electrical, mechanical, computer. It was a community of largely blue collar workers, there were some white collar scattered about. But engineering and science was not something I was exposed to. And it was, again, largely based on it was primarily a religious-based community and character and other religious values were really at the forefront of what everyone practiced. It was less focused on secular. Of course, that’s a complicated topic for me because in many ways I’m deeply saddened that I didn’t realize these things existed. And so I didn’t have the ability to practice when I was young or get a computer when I was seven years old and play around.
Bryan Johnson:
So I feel like I really got introduced to the world, the real world in my early 20s of thought and of engineering and of science. And at that point, I feel like I properly assessed myself. I determined I just had this raw ability to just generally figure things out and be tenacious. But also I wasn’t scoring myself high saying, “Well, I’m going to be likely to win a Nobel Prize.” I knew where I was at in the world of my abilities. And so I thought, with what I do know and with the skillsets I do have and deciding specifically not to go back to school and study for 10 years to acquire some specific skillset, I’m going to try to be resourceful and accumulate assets, money specifically, with the theory that when you have these assets that you can do things, you could basically hire these specific skillsets that you yourself don’t have.
Bryan Johnson:
And so I was trying to solve that equation. So the skillsets I didn’t have myself plus being able to do things at a certain scale. And in the first few years of entrepreneurship, I tried a few companies, some were successful, some were not, but none meaningfully successful enough that it was a life changer. I really was at a point in my life where I wasn’t sure what to do because thus far I hadn’t stumbled into a hyper-growth business or I hadn’t been successful in my endeavors. And I evaluated going to law school and business school. And law school, which I thought, I know a lot of people who are successful who are lawyer, or I’m sorry, who went to law school but don’t practice law. But I respect them immensely with their unique ability to think. I honed in on the skillset of thinking, and I was particularly drawn to people who had gone to law school.
Bryan Johnson:
So I took some practice tests of the LSAT, and I scored atrociously. I don’t think any school would have accepted me, which is true with my ACT in high school, it was just awful. I would have done better by answering B on every answer. And then I looked at business school and I thought if I take the GMAT, no business school is going to accept me, for sure. And so I found Chicago Booth, the executive program, and saw that the admission standards were … That I would be evaluated as a person based upon what I had done in life, what I had attempted to do. So I submitted my application and the administration there for some reason, they decided to accept me. I think at the time they told me I was the youngest person to get accepted into the program.
Starr Marcello:
That’s true.
Bryan Johnson:
It was a life-changing moment because from my vantage point of my little Utah state of mind to this metropolis of Chicago and Chicago Booth as being one of the best business schools in the entire world, it was hard for me to reconcile how I could ever be qualified to be among that group, that I would be outmatched on every level. And so it was very difficult for me to reconcile how I possibly could have gotten accepted and how I would be among such an accomplished group of people.
Starr Marcello:
I’m curious before we dive deeper into your experience at Booth, if you could have gone back in time and changed your situation, if you had had exposure to science and engineering, if you had had a computer when you were seven, what would you have done with that?
Bryan Johnson:
Me answering this question again is probably more revealing of my psychology now than my psychology as a kid. I probably would have tried to break out of the video game, that’s where all my intuitions pointed, is I wanted to find the boundaries, I wanted to knock them over, and I wanted to find infinite expanse.
Starr Marcello:
Okay. We’ll go back to your Booth experience. So you’re here at Booth, I would argue certainly a place where you belonged, a place for deep academic and intellectual thinking. You took advantage of the New Venture Challenge with your company Braintree. Tell us a little bit about where Braintree came from?
Bryan Johnson:
I suppose, as many of the best things in life, it was a mistake. I was married, I had two children. I was pursuing another entrepreneurial endeavor that wasn’t going very well. I needed income to pay my bills because I had a whole bunch of debt and nobody would hire me, I could not get a job with anyone. And so I found a job posting to sell credit card processing on Monster.com, and it was 100% commission going door to door. And out of desperation, I took it. And it just required the process of walking into a business and trying to sell them something they already had, so you’re trying to replace an existing product. And I discovered an industry that was broken. So by accident, I found an opportunity to pursue.
Starr Marcello:
I’m just curious, you said something just now that we hear a lot from entrepreneurs, which is no one would hire me or a traditional company, I wouldn’t belong there. Why do you say that?
Bryan Johnson:
It’s the video game analogy. It’s rules are set, the scoreboard is on the wall. Everyone knows what scores points, what gets points taken away, everyone knows fouls. It’s a choice of what is your game play in life? Do you like to play within known structures and known games or do you like creating your own games?
Starr Marcello:
So with Braintree, you, I believe, had started the business before applying to take it through the New Venture Challenge. What did you gain from going through NVC?
Bryan Johnson:
Up until that point, Braintree was a creation inside my mind, and it was the first time that I was required to articulate what that vision was. And then the supporting mechanics on how that vision would actually happen. In my first presentation. I discovered that disconnect when I explained what I thought was a clear understanding of Braintree and my vision. And Waverly Deutsch said something along the lines of, “That was awful, just an absolutely awful presentation.” And what a wonderful experience for me to discover that the clarity that I felt in my mind I could not properly convey to other people. And that so much of my success of the future would be contingent upon my ability to learn how to translate what I thought I understood in my mind so that other people could understand it in their minds, and that I could learn how other people understood it so I could improve what I thought in my mind.
Bryan Johnson:
And the New Venture Challenge offered me, it was the very first time in my entire life I had been in a system to help me improve. I’d never had a mentor, I wasn’t surrounded by a strong community of entrepreneurs in Utah when I was starting various companies. I wasn’t in engineering groups when I was a kid. So I was really just winging it on my own. And to be around other people who had started successful companies, sold them, gone on to other things to drop these tidbits of wisdom of like, “Hey, you may want to think about this.” And then it required me to be a careful listener and scaffold that knowledge as fast as possible. So it was a breath of fresh air.
Starr Marcello:
Did you think as you were going through this highly competitive program that you would walk away winning the top prize, getting attention from the entrepreneurial community at Booth and in Chicago?
Bryan Johnson:
No. It was interesting. I say no. One of the teams that year, their business model was a prediction market. And they did prediction polls of who they thought would win. And Braintree was in between first and second place on a fluctuating basis. I was surprised by that, that other people had the perception that we may have a chance at winning because my perception was not that at all. I thought that the other businesses people were talking about, they were just maybe more interesting businesses, things that got people excited about the future — inventions, medical advances, et cetera. And I was talking about this really boring thing of moving money from one place to another.
Starr Marcello:
I wonder looking back at that moment of winning the NVC that year, what did winning it mean to you?
Bryan Johnson:
I think it was one of the first times that I felt like I had an additional element of social credibility. Before that, there was not much I could really point to on why people should take me seriously or why I would be considered to be a meaningful contributor on any project. I know, for example, in my study group in class, my classmates were all much better at school than I was. In starting the payments business, it wasn’t like I was this prodigy of payments walking into the world, so I just didn’t really have any credibility. I’d done a four-year degree of course, but so many people do that, it’s not necessarily a marker. And so I think that was the first time where what I perceived to be credible people in society voted with their confidence that they thought that this endeavor could be successful. And it was meaningful to me because I had never had that outside expression of confidence.
Starr Marcello:
So what happened after NVC? I will say often we hear from teams that go through the program that you can gain a lot of momentum while the program is happening. And certainly if you place highly or if you win, you have a big burst of momentum, credibility, potential interest from investors or others in the community. What happened after the NVC was over and you got to work on building Braintree?
Bryan Johnson:
Two things happened specifically that set the course for Braintree. First is that Chuck Templeton, who was the co-founder of OpenTable, was an early advisor to me. And he introduced me to his team at OpenTable who at the time, they were trying to solve a problem in storing credit card data from reservations. And they didn’t want to deal with all the compliance issues of having to have credit card data on their server. And OpenTable said, “Look, if you can solve this for us, we will pay you $1.4 million over three years, $30,000 a month. And we’ll give you a $98,000 signup bonus.” And that was enough for me to hire a team of three software engineers to build this payment product for them. And so instantaneously, we were profitable from day one.
Bryan Johnson:
And I had a small team of engineers, and we built the foundation for this payment product. And then the second thing that happened is the fastest growing company in America that year on the Inc 500 list came to us and they said, “Hey, we really want these payment capabilities. We don’t have them right now, and we need a company to do this for us.” And we got the deal. Somehow our teeny little company. And so in year one I think revenue was going to top $1 million, net profit was going to be $500,000. And that gave me the financial foundation to then start imagining how we could grow a lot faster. And so I bootstrapped the company for almost five years, we were profitable I think almost every month. It was such a delight to be able to play … I guess it was kind of like going outside with my dog. It was like this little world, and we got to play every single day on building this little company and bringing about the best innovations that we could imagine.
Bryan Johnson:
For example, we worked closely with Uber to build no-payment transactions. You get in a car, you leave a car, and there’s no exchange of … And we got to do innovations like that. And people just accept that as a norm in life. That wasn’t then. And so we introduced that plus a whole bunch of other examples, we introduced new ways of how commerce was done. So that was fun, that we really got to play within the scaffolding of society. I guess what happened is it transitioned from a startup that could make some money that would be interesting to, now we’re playing this game of societal scaffolding of payments. And now of course, Braintree is a part, is literally part of the scaffold in society. When you factor in Venmo as well, it’s a significant element of society. And that is so joyous to think about, that we built something that remains today, that is growing today, and that is part of what we all rely upon as we exist on this planet.
Starr Marcello:
I feel like we should go back to your reference to Venmo, perhaps one of the best acquisitions of all time. How did that happen?
Bryan Johnson:
When I was presenting Braintree in the business plan competition, I presented that the real money in payments — PayPal was the only company making money in payments because people could fund their account with their checking account and not their credit card, and that would mean that PayPal could make 3% on the transaction by not paying the bank fees, then everyone else was making a nickel or a dime or a penny or some small amount. And there had been many people who had seen this of course. And PayPal had got their start by building their two-sided ecosystem with eBay. So they really got help in that two side of getting consumers and also getting businesses. Others had tried to replicate what PayPal had done in building a two-sided marketplace at the same time. And that of course is very, very challenging. So many companies go to a two-sided marketplace business to die.
Bryan Johnson:
And so in my business plan competition, in the plan, I said, “In the next four to five years, we’re going to build one of the best customer bases in the whole world by being the best provider.” And then when we have this maturity, we’re going to acquire a consumer payments company and bring those two together. And of course, life never works out like you think. This one did, oddly. And so in that four years time, our customers included GitHub and Airbnb and Uber. So we had some of the fastest growing companies in the world using our technology. And those same people who use those services, Uber and Airbnb and GitHub also use Venmo. And so we had this up-and-coming group of people, and so it married this demographic.
Bryan Johnson:
And so now we were beating PayPal at acquiring the best businesses, we were beating PayPal at acquiring the best, I guess, individuals that they were targeting on what they wanted, and we brought the two together. And it was incredibly powerful how it all came together. And Venmo has done remarkably well, the founders deserve all the credit for coming up with such a counter-intuitive idea of making what we consider to be payments, something that should be secure and private and not seen by others, to this open social conversation. They really were creative and wonderful in doing that. And we just happened to join forces at exactly the right time, when they had reached a point of maturity in their ecosystem where they needed to be with someone like Braintree. And our growth at Braintree also would be dramatically enhanced with adding Venmo. It was a beautiful combination.
Starr Marcello:
I want to go back to something you said earlier and a theme perhaps with this acquisition of Venmo. You said that after NVC you had some early wins and you got some big sales where companies took a chance on Braintree as a small startup. Generally, that doesn’t happen by accident. So I’m curious if you can share any of your reflections on what made you compelling selling what Braintree was offering? We try to teach things like entrepreneurial selling here at business school. How were you able to convince customers to take a chance on you?
Bryan Johnson:
My first education on this was when I was first exposed to payments and doing the door to door sales for that company. And it was really a psychological question of, are you trustworthy? And after a few interactions with customers, that was very clear to me. I would walk into the business, and they would see me dressed as a sales person. And they’d say like, “Please, go away, I have things to do.” You’re never wanted. And I would pull a $100 bill out of my pocket and say, “I will give you $100 for a few minutes of your time. If you listen to what I have to say and you still want the $100, I’ll give it to you.” And then I would just lay bare the entire industry like, “Here’s who the players are in credit card processing, here’s what they do. Here’s what their statements look like, here’s how they’re taking advantage of you. Here’s how the whole thing is dishonest.”
Bryan Johnson:
I’ll just reveal all those secrets and say, “I don’t play any of those games. What you can expect from me is clarity, cleanness. And if you have a problem, I’m going to solve it for you very fast. So I’m just going to make this go away.” And it resonated so deeply with people because they had learned properly to never trust anyone in the credit card sales industry. There were so many ways to get to take advantage of people. And it was so complex that salespeople could generate very high commissions by manipulating buyers. And it was just a thorn in these business owners’ side that they had to deal with this constantly, the next deal which is going to get them.
Bryan Johnson:
So once I had a base of customers who trusted me, they just referred all their friends like, “Hey, for once and for all, you can solve this hairy problem of yours with this guy.” I took some of those lessons. And when I started building Braintree and we were building a software product, there was still a pretty big fundamental component of, can I trust you? And over time, the pitch of Braintree changed in terms of the features we could offer and our scalability and the number of countries and the currencies and all that kind of stuff. But initially, it was really, do I trust these people and will they be here for me, and will they respond on time? And so I don’t know exactly what the thought processes were of these initial companies.
Bryan Johnson:
I think OpenTable probably trusted me in proxy because Chuck had referred me, so I was riding on his trust profile that he had built with those relationships. With others, it’s probably accumulation of people who we referred them to, like OpenTable as a happy customer. But yeah, I think the characteristics probably switched. But a non-changing element that everyone’s going to go through is, people want to make good decisions about other people. And they’re running algorithms at all times to assess whether they really think they can trust you or not, and whether you can deliver what you say you can, and whether you’ll be forthcoming with what you can or cannot deliver. And if you will be the one to willingly tell them when you’ve messed up or when you can’t deliver something you’ve said or when you’ve over promised. We all know this from human relationships, we don’t want to deal with people who are not going to behave in a way where they create expectations.
Starr Marcello:
I want to ask you another question about people and managing people. With Braintree, you built a super successful company. It involved you managing engineering teams without being an engineer yourself. This is going to be a theme for you moving forward in other entrepreneurial endeavors in your life. How were you able to create strong relationships, communicate on technical things that you might not have had as much depth of knowledge about? How were you able to manage teams like that successfully?
Bryan Johnson:
I thought a lot about this because in getting into Braintree, I was in over my head. I was taking on a software project that I myself couldn’t code, I didn’t know what the architecture was going to be. I didn’t know how to hire software engineers. I didn’t know how to verify the quality of the work product, and so I was blinded. The same is true of course as you were alluding to with Kernel, but just on orders of magnitude greater difficulty. I’d say two things. One is it’s a process of chipping away at the problem, it’s not solved in one go. And so it’s creating these edges of knowledge so you are a reliable filter for accuracy. And what you’re trying to do is sniff out inaccuracies or poor performance or discontinuities.
Bryan Johnson:
And so I had to create an algorithm of filters to understand if I was working with a software engineer, did they know what they were talking about? And if they didn’t, could I sniff it out? So there’s that component. And then the second thing was alignment on what we were trying to do. So we had some language in common. And one of the goals that we had that everyone latched onto was this idea that our customers would write us love letters, and to capture the essence of the company in a small number of words. We are looking for someone to show up and counter our API documentation or support infrastructure or product offering or a website or whatever it is, whatever presence we have in the world. And to experience a biochemical reaction of pleasure, that I trust this company, I like this company, I wish all companies would be like this company, whatever the outcome is. And they would then report that to us. So they’d feel so compelled from the experience they tell us that we would get that active feedback.
Bryan Johnson:
And so there’s a different level of delighting somebody where they’re passively delighted by the experience. And there’s a certain level of delightment where the person says, “I’m uncontrollably delighted, and I have to tell you about it.” And in establishing that with the team, that we will accept nothing less than an uncontrolled delightful outcome. And that we want people to be emailing us and sending messages on social media about how much they love us, that that was our standard. And when you set your goals at that level, it does a lot of work for you. Where if somebody can’t deliver on that level either in what they’re programming or in the product or managing or in the customer support they’re offering, they get weeded out pretty quickly from the system.
Bryan Johnson:
And so it just accumulates on itself. And so it increases the first point I brought up, which is the algorithm of how do you properly deduce competence and alignment? Those two things constituted the algorithm that allowed me to learn very, very fast how to hire software engineers, how to properly work the engineering team, and how to create a cohesive environment for that new kind of business that I’d never built before.
Starr Marcello:
Is there something that you think you did, or maybe continue to still do with Kernel, to have that two-way trust so that you trust the competency of the work that’s being done, but also that the engineering team or technical team is trusting you?
Bryan Johnson:
It’s a funny relationship because in any human dynamic where one person knows more than the other person about a given thing, they’re wondering, “Do you really get it? Do you understand your level of ignorance? Do you know how to poke around at your own ignorance? And do you know the limitations of decision-making while you’re in ignorance? And when you’re in that state, will we be able to have discussions where you’re going to leverage my knowledge and my wisdom?” And if the person can make those assessments and say, “You know what, I’m better off because I’m with this person than I would be on my own.” That’s the key.
Bryan Johnson:
And so it’s really a symbiotic relationship, but it’s hyper tuned. And especially, this has been true with Kernel. With Braintree, I could be two or three layers deep in the software, understanding how to build a good software stack. At Kernel, it’s down to photons and atoms, the edge of physics. It requires the dimensionality of awareness and of thoughtfulness that’s just totally a different league than where I was out of Braintree. And I don’t think I ever could have been capable of starting Kernel without having first built Braintree.
Starr Marcello:
So let’s go back to what got us to Kernel: Braintree. When did you know it was time for an exit?
Bryan Johnson:
There were so many things going on. I knew that I had to restart life. I had been born into this video game of a reality through a religious context, I was exiting that reality. I had been in a marriage that was consummated in that reality, I moved past that. And then just me as a person, I had moved on. All these forces were coming together of this explosion inside me of something new is happening. And Braintree had hit this point in our progress where it was just up and to the right. We were growing incredibly fast. The addition of Venmo only made it go faster. And it was very clear to me that we were going to either IPO or get acquired.
Bryan Johnson:
And in either one of those scenarios, a typical deal would require me to stay for four years. And at the time, I was 33 years old. And my aspiration for the longest time was, again, to try to contribute something meaningful to intelligent life on this earth over the span of hundreds or even thousands of years, so that if I did something of value today, it would be valued in a few hundred years or some future time point, it would reach that potential value threshold. And payments wasn’t going to do that, didn’t have the characteristics of it. And so I needed to find it. But that, from my 33-year-old vantage point, seemed impossibly hard. How in the world do you figure that out? Especially when I’m looking at myself in the mirror and saying, “I honestly don’t really have anything special about me,” literally. I’m a resourceful guy, I can solve problems, I can get along with others. But it’s not like I’m the prodigy engineer building this thing.
Bryan Johnson:
The problem that I was facing was not that I just myself can’t invent this given thing, but I have to figure out this larger system question. And, more importantly, doing something is going to require building that thing for a few decades. It’s not going to happen in three years, it’s not going to happen in 10. It’s a 30, 40, 50-year thing. And if I’m 33 now, I need to spend a few years to figure out what in the world I’m going to do, and then I need 30 or 40 years of wonderful health to really go at it. And so the only thing on my mind was how do I get working on this next project as fast as possible? And then how can I harvest whatever is going to be at Braintree? Because I knew at that point it was going to be big.
Bryan Johnson:
And whatever the outcome was, it was going to be big enough to fund this next thing, at least to get me started. And so those were the pieces of the puzzle I was trying to piece together. And so it was a lot, it’s like, how do you build new Bryan, how do you in my marriage, with my kids, with my religion, with my essential reality with this new thing? My entire existence had to be reconstructed in that moment.
Starr Marcello:
It’s so rare that someone changes so many significant aspects of their life at one point in time to say, “I intentionally need to create the opportunity for me to pursue the thing that I feel compelled to pursue as my life’s mission.” How were you able to make those decisions, make the changes that needed to be made and set yourself on this new course for the work that was imperative for you to do?
Bryan Johnson:
In these moments, as a human, the tendency is to spin up a hero story. That would be the temptation. And walk through, identify the characteristics that I find admirable about myself and make things up that are probably embellished from the reality. But I think the more relevant answer is in something pretty mundane, where in that time period of things I was going through, I would overeat every night. I would wake up in the morning, I would work out. And I would listen to Eminem, and I would just absolutely destroy myself. And I would have a wonderful breakfast, I’d have a salad for lunch, I would be disciplined all day long. And then nighttime would come, and I just couldn’t stop myself from overeating. And then I would just feel absolutely awful about myself because I felt 30, 40, 50 pounds overweight. My pants would be tight, I would just find it unbearable to wear it. I’d have to take out one more belt loop, it was just devastating to me psychologically.
Bryan Johnson:
And one day I had this idea to fire Bryan. The Bryan who occupied my conscious mind from 5:00 PM to 10:00 PM, he was an unreliable partner in the construction of Bryan. And the firing was, he no longer has authority to eat food. Literally he cannot eat food, he has no authority. And so any food I want to eat during the day has to be before that 5:00 PM time period. And I did that, and it changed my life. I probably cheated something like 40 times, but then I finally got to a point where I would cheat and I would say, “You know what, I’m going to cheat. But I know within 30 seconds of cheating I’m going to feel awful about myself. I’m going to regret it so badly, and I’m going to just deal with the pain all night long and all tomorrow.”
Bryan Johnson:
I think, to answer your question, of when all those things were changing, I was trying to play this psychological game with myself where I was acknowledging that I am not one person. I am thousands of different Bryans. And these different Bryans manifest themselves according to my sleep the night before, what I’ve eaten five minutes before, my environment, the people I’m around. I vary according to all these things. And I created almost a detached relationship with myself where I could look at myself and say, “You know what, that’s existential threat Bryan. You’re not very fun to be around, and I don’t know if I want you in my life anymore.” And so I started playing these games with myself of trying to trim up the versions of my conscious experience and unconscious experience that I really wanted to be part of my life. Maybe, I suppose that was a survival move because going through that much change in such a short period of time did in fact place a tremendous amount of psychological distress.
Starr Marcello:
So how did you get from the point of, I know the change that I want to make in the world, I know how I want to contribute to the future of humanity, to understanding how to harness the talent or time and energy, the space to actually address it in a certain way?
Bryan Johnson:
It was such a fun game, it was about a two-year time period. And I initially thought the richest source of information would be other people’s brains, that I could piggyback on top of their thought processes and not have to walk down the same ones myself. I commenced this process where I would identify the most ambitious and aspirational people I could identify. And then I would approach them and ask them a series of questions, like, what are you doing in the world? Why are you doing it? What are your core assumptions? What other alternatives did you consider? If you were to do something again, what else would you do? I was trying to just unpack their entire assumption stack of what they’re doing and why. And it gave me dozens and dozens and dozens of trails to follow. And then I started bringing those people together in dinners.
Bryan Johnson:
And I would pose questions such as, let’s imagine we are in the year 2050 and we look around the world and we say, “Huh, we did a pretty good job. What did we focus on in the year 2017 or 2016 that allowed us to feel pretty good about where we’re at as a species in 2050?” And I got some discussions and everyone’s comments, of course which sparked other discussions. And after doing this for two years, I realized that there was one thing that it seemed like no one was really focused on in a concerted way. And I was brought back to Darwin in terms of how evolution has been a scaffolding form of intelligence. It just step by step improves the system’s abilities in its own algorithm. And if you look at how society is improving around us, we approach engineering progress in science and technology and in our institutions, we’re making really wonderful progress. If you look at that, like for example, how much progress have we made in science and technology over the past couple of hundred years?
Bryan Johnson:
Well, the 14th century with the bubonic plague, the scientific response was prayer circles. And this time around, we sequenced the genome and we have an mRNA vaccine designed in two days, and we have clinical studies going on. This is very different. And so that’s an example of compounded progress where you’re scaffolding these gains. And the one thing that is not being systematically scaffolded is human thought. It is not yet an engineering discipline, and that’s because we can’t measure it. So if you think about what you can measure, if you look at a nutrition label on food, you can make good decisions on calories and fat and carbohydrates, et cetera. If you want to assess the health of your heart, you have plaque levels and HRV and heart rate, and you have EKGs you can do, so you can acquire data.
Bryan Johnson:
And the measurement, your ability to measure informs intervention protocols. And the more measurement you have, the better your intervention protocols can become. And so the only thing that’s really outside of the formal scaffolding of existence, of our world here on Earth, is our mind, our thoughts, our emotions, and our thoughts. So I hypothesized that if technology could be built to measure the mind and quantify it like we can other streams of data, you formally bring cognition to the formal discipline of engineering. And humans now, we are the architects of intelligence. We architect science and technology in our institutions, we’re building artificial intelligence. And that’s increasingly becoming a two-way street, like who’s building whom? But humans right now are in the driver’s seat. Well, yeah, I guess literally soon maybe not be.
Bryan Johnson:
But basically, if you imagine what is the future of human existence? Then a fundamental turning point in intelligent life is going to be when our cognition becomes engineerable. And that’s what I wanted to accomplish. And I couldn’t find anyone in the world who was doing it. There were people doing work on brain interfaces but for the purposes potentially of treating this disease and that dysfunction, but no one for the systematic engineering of intelligence. And that was the conclusion on Kernel, this is what has the potential of making a meaningful contribution in hundreds of years as a turning point for how humans … I guess the last thought on this is all the things people were talking about with me, like climate change and pandemics and political division, all the hot topics, those all exist downstream from the brain. The observation was, everyone is just one or two clicks down. Let’s go back to the source because all things are in this area of focus.
Starr Marcello:
I think many aspects of your story are going to inspire those who are listening to this podcast. Can you tell us more about these two years of exploration, you reached out to those you admire most to ask them a series of questions to gather them around a table and have discussions. Why did they give you the time of day?
Bryan Johnson:
What do humans like more than to have others interested in their opinions?
Starr Marcello:
It’s true. I think the other thing that’s maybe helpful for people to hear with Kernel entering uncharted territory, both with the science of what you were hoping to accomplish, also just based on your own background. And as an entrepreneur starting a company like Kernel is very different than starting a company like Braintree or like ventures you had done prior to that. What was the most difficult challenge you faced in starting this company?
Bryan Johnson:
Being me. On the surface if you stack up what would reasonably be qualifications to start something like this, I maybe had one: money. If there’s one virtue that I brought to starting this, it was that I was naive. I remember in particular it was in August, this was a year into starting Kernel. We brought one of the world’s foremost neurosurgeons into Kernel to help us, we were building invasive technology at the time. And I had been looking everywhere for technology, I wanted to find, what was the entry point? What was even possible to build? I’d spoken to so many people trying to piece that together in this comprehensive survey. And we were finished with the day’s discussion, we spent three years together and we talked about all the mechanical and electrical and regulatory components of this implantable device we were building.
Bryan Johnson:
And then at the very end, we were just having this small talk. And he said, “In my experience, being in this industry for almost 40 years now, every 15 to 20 years, a new technology comes along that changes everything. The technology we have now is at the end of its maturity curve. The new technology is already here, we just can’t see it.” And my jaw dropped. One of the most significant moments of my entire life. And I went back to my team and I said, “I don’t think we have investigated the optionality with enough thoroughness. There may be a better path that is more aligned with this time and place of brain interfaces.” And we did that. Within a few months time, within four months, we transitioned the entire company to a new technology focus, which was of course also equally difficult because nothing’s harder than that because you build relationships with people and you make commitments and you set expectations. Ultimately, a startup thrives and dies according to its ability to respond to information in real time. The only thing that matters is the responsiveness to the intelligence system.
Bryan Johnson:
But yeah, that’s what led to where we’re at today. We don’t sincerely know really what we’ve built yet. We’ve built the technology out in front of what even the experts know can be done with it. We’ll find out in the coming years. Kernel is atypical in that there wasn’t just a product sitting on the shelf and we said, “Hey, we can build a better version of that, and we can scale it out with investors who understand the story.” We said, “We have no idea if something’s here, we’re going to explore. If we find it, we hope we can build it. And if we do build it, we’re not quite sure what it’s going to do, but we hope it can do a lot.” So there’s so many hops in there. I think Kernel would not exist if I couldn’t have funded it myself. Kernel barely existed in raising a round of capital.
Bryan Johnson:
I spoke to 228 investors to raise our first outside round of capital, one person said yes. And I understand why, it’s a difficult one to get your head around. So this is not a criticism of investors, this is just that this is the game we’re playing. I think the next two or three years is going to be extraordinarily exciting because it’s like Christmas, we get to find out what’s in the box. And yeah, it’s here.
Starr Marcello:
Is it the next two to three years? Is it the next 10 years, 20 years, 30 years?
Bryan Johnson:
It’s such a good question. And that’s entirely where my mind has been at for the past few months. And so the algorithm I’ve been trying to solve is — a new technology finds its utility in the market over a certain duration of time, as you mentioned. And so if you say, for example, that when Fitbit was built, I’m not sure when they started, but let’s just call it 10 years ago. And you just would have said, “Give me a rough estimate, what do you think Fitbit’s worth?” You put this technology on the wrist, you track steps. And eventually, you’re going to get to these other measurements. The answer ended up being about $2.5 billion, which is what Google paid for them. And they didn’t have necessarily additional ecosystem value to build on top of technology, they didn’t necessarily get all that much more valuable with additional data streams.
Bryan Johnson:
Kernel technology has all those attributes. Kernel technology is much more like a smartphone where people will be able to build on top of the ecosystem with every additional data stream, our technology is more valuable. So there’s a different game of value creation. So basically what I find interesting about this is, in the process of hiring people, in the process of speaking to investors, people are trying to assess whether they should get involved in whatever activity they’re involved with. And so whether it’s investing money or joining the company. And the default thought process that almost everyone has is, what is the killer app? And behind that statement is an assumption that human intuition is the source of intelligence that should be generating the conclusion. The difficulty is, you’re dealing with this wildly complex technology, and you’re looking at the most complicated system of intelligence in the universe.
Bryan Johnson:
And so what is a killer app is a question that falls short of being able to address it. And so what I think the correct answer is, you want to eliminate human intuition. What you really want to enable is a random number generator for value creation. And so if you look at it from a mathematical formula, then you would just simply say the variables in that formula include how many devices are in the world, how many experiments are being done with how many participants? How many mistakes can you get into the system? Because you want people to make mistakes. When the Pfizer vaccine went out to be distributed and people made a mistake of doing half the dose, they found out is more effective than the dose Pfizer had prescribed. You want mistake creation in your system of discovery.
Bryan Johnson:
And so now the team and I work very hard every time we are evaluating how to build something. If our intuitions creep in and any of us starts expressing an opinion of, “I think this because,” we stop and we say, “human intuition is not welcome to this conversation, random number generators are.” So if you have an idea on how to create this algorithm or this mathematical function of how this technology creates value. So it’s a very different mindset, and it takes some acclimation to think about that because it’s just not how people normally approach product market fit.
Starr Marcello:
That’s very true. Are you optimistic about the future of humanity, the dream for 2050?
Bryan Johnson:
The way I interpret that question is, am I anticipating experienced biochemical interactions in my brain that produce positive states of being in the future? Is what I hear you saying.
Starr Marcello:
Yes.
Bryan Johnson:
And what I know as a human is that I am an extremely bad predictor of what a future Bryan may or may not , and what that future Bryan may or may not find satisfying. And so I think that never in the history of the human race, never in the history of intelligent life on Earth has a generation of people been able to look out over their lifetimes and conclude there is a possibility that the fundamentals of their conscious existence may be altered beyond their ability to comprehend. That we would literally transform ourselves into something totally unrecognizable from what we are today. No one else has ever looked at that contemplation. And so I would, again, express extreme reluctance to model any future state based upon my proclivities today upon the future.
Starr Marcello:
I have just a couple more questions for you. Just looking back now from where you are with Kernel, with your thoughts about the future, with how you’re spending your day, with the Bryan that you fired. If you could go back to yourself walking the dog as a child, maybe not even then aware of the video game that you were in or that you wanted to break out of, what would you tell yourself? And what you’re doing now sounds a lot like you’ve fulfilled the dream that you intended to from an early age. Is that true?
Bryan Johnson:
First, the thing I would say to that Bryan would be: things are going to become more painful than you can imagine, excruciating to a degree that is going to be very tempting to conclude it’s not worth carrying on. And then I would say, despite the irresistible urge, carry on because it’s worth it.
Starr Marcello:
I think my last question for you is: there’s a lot of mythology around the founder story, the hero story, the hero story of entrepreneurship, particularly for people like yourself who’ve been successful beyond many people’s wildest imagination. If there’s one myth that you could debunk about the entrepreneurial journey, what would it be?
Bryan Johnson:
That you should work 20 hours a day and sleep under your desk. Do the exact opposite. Quantify your sleep, engineer your life to have as near perfect health as possible, and to value highest among all things, clarity of judgment.
Starr Marcello:
Very well said. Any questions you wish I had asked you that I missed?
Bryan Johnson:
You asked that question of, do I have the biochemical configuration of optimism as it relates to the future? And I think the most relevant question for intelligent life on planet Earth is, what shared conscious experience do we aspire to have? Being human right now, living in society, is brutal. We all feel it. The stress and the demands, and our minds are our own worst enemies. We have difficulties getting along, we fight quite a bit. We have a hard time understanding each other’s opinions. Nation states are jockeying for power, and we’re always at risk in threat. We’re primitive, we’re a primitive species, we’re a primitive form of intelligence. How can we imagine rising above our primitive selves and mustering the imagination that we aspire to a shared consciousness? Not even one we know, not even one we can articulate. Even saying the words we could use would fall short of capturing the essence. But we’re all in this together, where is the shared aspiration of that? Why aren’t we all talking about that?
Bryan Johnson:
It’s relevant because we have the technology to go after it. It’s not a mindless exercise, it’s not a futile experience. We actually can go after these things. And it is not an active conversation. And I understand why. There’s a lot of pressing things on our to day-to-day basis, and we’re all very busy with the things immediately in front of our face. And I also realize that I’m coming from a privileged position. Other people have very real daily responsibilities that I do not have. And so I’m in this fortunate position, I get to think about it. Also, everyone is fueled by hoping that something better in the future is going to exist. That’s a commonality we all share. But I think it’s the most significant opportunity we have right now to look up and start to explore what kinds of questions we want to ask and how might we start walking down that path.
Starr Marcello:
Yeah. That’s the key thing, how do we get from here to there? Well, thank you Bryan for taking time to chat and recording this podcast.
Bryan Johnson:
Thank you for having me and for all the wonderful things that you and your colleagues have contributed to my life.
Starr Marcello:
Well, of course, and hope to be able to contribute more. But it’s very exciting everything that you’ve done. It’s hard to believe actually. And so intentional. I think so few people do get to feel like they’re pursuing their life’s dream. It’s amazing.
Bryan Johnson:
Thank you, Starr.
Starr Marcello:
Yeah, of course.
Colin Keeley:
All right. That is it for this episode. If you could do me a huge favor really quick, please go to your favorite podcasting app, often Apple Podcasts, and rate and review our show. This gets the show recommended to more folks, and it also helps us get bigger and better guests for you to listen to. Take care.