The Winklevoss Twins: The Past, Present and Future

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  • Winklevoss Twins , Principals at Winklevoss Capital

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About Winklevoss Twins

The atmosphere at ZURB HQ was positively electric when Tyler (@tylerwinklevoss) and Cameron (@winklevoss) Winklevoss dropped by our offices. We had a lot of fun as we chatted with the twins about where they've been, where they are and where they're going. They answered our questions with a combination of good humor and great insight.

Tyler and Cameron were very upfront about their early days at Harvard and shared their thoughts on the movie that immortalized their story, "The Social Network." More than that, they talked about what it takes to be a leader who is capable of transforming a great product into a great business. We were also lucky to get the inside scoop on their latest venture, Winklevoss Capital. The new company, which they co-founded, focuses on early-stage startups.

Feel free to listen to the podcast as you read through the summary of the event below.

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Becoming Angel Investors

After having retired from professional rowing, the Winklevoss twins spent time trying to figure out what their next step would be. They'd liked the idea of becoming angel investors and helping younger entrepreneurs. As Cameron said:

Through our journey, we have experience that we can impart and lend to people and bestow on younger guys.

The Winklevoss twins have acquired some 5,000-square-foot office in New York to create an incubator where startups in the New York tech scene can work on their products without having to worry about paying for a three-year lease. As they put it, the office would be an ecosystem where people can come in and grow.

However, the twins are still getting their ducks in a row and haven't firmed up any deals yet. Although, they did give us the scoop on who they are looking at, including a company trying to solve sizing for buying clothes online. Another company is in financial tech and another is in the cloud-service space. When asked if it was Yottabyte, which is working to build the first operating system for the cloud, the twins just said they're in conversation with them. As Cameron put it, they aren't looking at one particular industry:

When we look at companies, we look toward the team, the entrepreneur and what problem they are solving.

They said they looking for entrepreneurs who levered themselves into their idea, either by bootstrapping it or seeking the help of their friends and family. Cameron said:

If they can't sort of sell their friends and family on it, then why should they be able to sell me on it.

The twins said they've had a lot of outlandish pitches, everything from the next Facebook killer to "it's going to make Google look like peanuts." When it comes to pitches, simpler is better, said Tyler.

We like simplicity and things that are simple that can be understood in one or two sentences. You can distill Google or Facebook or any of these companies in a couple of sentences. If you can't do that, then it's probably a pie in the sky type of thing.

Cameron had another way of looking at it.

If you can't get up in front of a group of people and they can't grab onto it right away, then that's your first problem.

"6'5, 220 pounds and there's two of me."

Cameron and Tyler's story began eight years ago at the dawn of Web 2.0 in a Harvard dorm room as co-founders of ConnectU. A story that was immortalized on the silver screen in "The Social Network." Both agreed that the movie was a great piece of entertainment that should've won Best Picture. The film lost to the "King's Speech" in 2011, if you were wondering. Here's how Cameron viewed the film:

The goal of the film was to tell the story from three different perspectives, similar to a "Rashomon," sort of a reconstructing of the crime scene, if you will. As a result, the goal is not to draw a black-and-white conclusion. It's to create a grey area and [you have to] sort of grab onto to any character and defend them and support them.

Cameron said there were documents and facts out there that make the story much clearer. However, he doesn't blame the filmmakers for their approach. However, one shouldn't rely on the film as the sole authority on the events that transpired in that 18-month period. Of course, the twins were flattered to have the best line in the movie:

I'm 6'5, 220 pounds and there's two of me.

That line appears on Cameron's Twitter bio.

Trying to Solve a Social Problem

With ConnectU, the Winklevoss twins were trying to solve a social problem. The problem, especially at Harvard, was that once you get into your major it's nearly impossible to meet everyone in your class, let alone the entire school. The twins were trying to solve that problem with a tactile solution that "allowed our fingers to do the walking."

At the time, however, there was no startup culture. They faced the problem of finding talent that could help them make ConnectU become a reality. As we all know, they recruited a young Mark Zuckerberg to join their team. But then they discovered that Zuckerberg built what was then known as "Thefacebook," which eventually became the Facebook that we all use and know. They found out by reading about it in the school newspaper.

The twins said it wasn't naivete on their part — it's just that you don't think a fellow student to do that. Of course, there was a string of 52 emails over three months without a mention that Zuckerberg was working on another project. As Cameron said:

We weren't supposed to see it coming.

The twins didn't run to the courts immediately, but instead went to then-Harvard President Larry Summers — a meeting, the twins said, was very much like it was seen in the movie. They described the president's attitude as dismissive. Harvard takes academic dishonesty seriously, but not dishonesty between fellow students, said the twins. It's an issue that needs to be talked about more seriously, said Cameron.

It's a dialogue that has not happened and needs to happen.

Evaluating a Leader

When it comes to Mark Zuckerberg, the twins believe that a lot of Facebook's growth and success has been credited to one man. Cameron used the analogy of a plague. No one ascribes a plague to one man, it has that viral quality, which is what Facebook had. All that was needed was to keep the serves on and it would continue to grow, said Tyler. He also put it another way:

We think it was a team effort and he deserves credit, but we deserve some too — that's what we were fighting for.

Cameron viewed it another way:

Now is really when you start evaluating a leader, and saying, "OK what are you going to do with these billion people? How are you going to build a business?" It really starts today or three months ago. And that's when a leader is shown. You have to ask yourself, if you were to take Mark and put him in another company, can he lead that company? That's a question that a lot of people would say they're not sure. But if you took someone like a Jeff Bezos and put him in Facebook, he could figure that machine out.

Facebook's IPO and the Dictator's Dilemma

Leadership and governance came up when talking about Facebook's recent IPO. When it came to why the stock took a sharp nose dive, Cameron said that nothing was left on the table for retailers and anyone else that wanted to be part of it. There was also a question of whether Facebook was fully prepared, especially when it came to making money from mobile, despite it being plastered all over the social network's IPO filing. As Cameron put it:

You have a situation where mobile was something you could see a year out and so it's confusing why it's all of a sudden, we have to monetize for mobile.

They likened the situation of Facebook and mobile to Saddam Hussein believing he actually had weapons of mass destruction, or at least according to one theory they heard from a journalist covering that particular story. The theory goes that Saddam's lieutenants told him that those weapons existed to save their own skins. Believing those weapons were in his arsenal, Saddam fought hard to keep the inspectors out of the country.

Cameron said:

It's like the emperor has no clothes. If you don't have the governance and the structure in place and the people who could challenge you and give the hard questions. And if you're not doing your job, kick you out.

Tyler said:

It's sorta the Dictator Dilemma — you're not necessarily getting the right feedback.

Cameron said Facebook should have seen mobile a year or two beforehand, especially since they knew they'd be going IPO. The twins said that Facebook is focused on the user experience and there's not really a lot of talk about building a great business. Cameron put it this way:

In order to build a great product, you need to have the resources to plow back into it. Nobody from Apple would be discouraged to say, "we have a tremendous business, it's very profitable, we've got a $100 billion of cash on the books." They're proud of that aspect. I don't see Facebook describing themselves as trying to be a tremendous business and I don't see why you can't have both, and, ultimately, you need both. If you don't, someone is going to come across and take your engineers and eat your lunch, and the product will suffer as a result.

Tyler agreed, adding that Facebook floated their IPO too much. He said:

Everyone got caught up in that users equal revenue and that's not always the case.

Pop Culture Icons

As for being pop culture icons, the twins said they're flattered that someone felt their story was compelling enough to make a movie. They've embraced it. Although, they never saw it coming when they sought out to create ConnectU, all those years ago. As Tyler said:

We set out to start a website in 2002 and never predicted it [would have] gone this way. It did; we'll take it in stride. It's exciting and again we're flattered that people are interested in the story and we're excited to start our next chapter.

Our conversation continued as Cameron and Tyler took questions from the audience, including how it felt to work with your twin on so many different projects. We'd like to thank the Winklevoss twins for stopping by ZURB HQ and to all who attended the event.

Don't Miss Out on Our Next Soapbox


Ryan: Tyler and Cameron Winklevoss. Their story begins eight years ago when they co-founded ConnectU in a Harvard dorm room. That story was immortalized on the silver screen in the movie "The Social Network", which I'm sure all of you here watched over and over again. But nowadays, they've got WInklevoss Capital. Still a little nervous guys, bear with me. That they co-founded recently which is an investment fund for early stage startups. We're going to talk about all that.

First of all I want to welcome, coming all the way out to California, and joining us here at ZURB which is a really big soapbox today so super excited. I know there's a lot to cover, and I'm sure the audience has tons of questions and I want to make sure that they get their chance to do that.

First of all, I kind of want to ask you about your latest venture. After all these years, why go into VC and what are some of the projects you're currently working on, if you can spill the beans a little bit?

Cameron: Sure. I guess we kind of have been rowing professionally for a long time and recently retired and so moved into trying to figure out what our next step was going to be. I think we were kind of attracted to the position of being angels or investors, because, A, it allows you to see a ton and sort of learn and kind of see a deal flow constantly.

I think also through our journey, we have sort of some experience that we can I think impart and lend to people and instill on the younger guys. It seemed like a good fit for now for us. In terms of what we're currently working on, we're sort of finishing up with a few different deals, but we kind of don't want to talk about them right now. Not that it's proprietary, that we won't talk about them, but we're getting our ducks in a row and making sure that everything is in order before we talk.

Ryan: Something to keep you busy. Yottabyte, is that one of your guys'?

Cameron: We have not done anything with them yet, but they're good friends of ours and we have definitely looked in and we're in conversation with them. We like what they're doing and it's totally possible.

Ryan: In terms of that, re you guys looking to the cloud as, I think you were quoted as saying it's the next paradigm.

Cameron: I think that everybody thought it's probably a pretty obvious statement that there's a ton of activity in that space. We don't sort of focus on any given space, in particular. I think when we're looking at companies, we kind of look towards the team, the entrepreneur, and what problem they're solving.

If they're solving a problem that may very well be a problem for a lot of people and scalable, that makes sense. When we, I'm sure we'll cover this, when we were starting ConnectU we were just trying to solve a problem in our daily lives and we figured if we solved that then it would sort of extend outward.

I think that I also like entrepreneurs who have sort of levered into what they're doing, whether it's bootstrapping it with their own finances or raising from friends and families around them, because if they can't sell their friends or families on it, then why should they be able to sell me on it. Those are some of the criteria we look at.

Ryan: Is there anything, in particular, that you are looking for in pitches? There's probably a dozen folks out here that probably have a pitch for you, but what is it that you guys are actually looking for?

Cameron: As you can imagine, we get some pretty outlandish pitches.

Ryan: What are some of those? We've got to quantify that.

Cameron: Next Facebook killer.


Tyler: Going to make Facebook look like peanuts or Google look like a lemonade stand, just not - those aren't really credible pitches. It's what you're going to do, not so much how big it's going to be. We like simplicity, things that are simple and can be understood in one or two sentences.

If you can't, you can still distill Google or Facebook or any of these companies down in a couple of sentences. If you can't do that, then it's probably a 'pie in the sky' type thing.

Ryan: What would be an example of a very effective type of pitch, maybe if you were to make an example.

Cameron: Yottabyte is basically trying to be the first operating system for the cloud. I think Microsoft was the first software company where you didn't have to buy a hardware all-in-one kind of thing.

Cameron: I think with the operating system in the cloud, they're trying to solve that problem through software and making the hardware run more efficiently as opposed to just throwing more hardware at it. I think those type of, when people can explain their angle in one or two sentences, is that makes sense.

Digging down deep and figuring out how they actually are making, using the software to make it more efficient, that takes the time, and you've got to really bring in the engineers who understand that space. In one or two sentences, if you can't get up in front of a group of people and they can't grab onto it right away, then I think that's your first problem.

Ryan: In terms of that, where are you guys actively looking for these projects, for these pitches? I understand you have a New York office?

Cameron: Yes. We just took out a space in New York. It's going to be about 5,000 usable square feet. It's in the Flatiron District so there's a lot of activity in the tech/stat-up space there. That's sort of where we're starting and we may end up doing a west coast office, but it made sense.

We're sort of from the northeast, we have a network there, friends and family, so that's sort of where we started and I think that there's a need in the city for a home.

Part of what we're doing with the office space is it's not just the two of us. We're trying to bring in portfolio companies that we've invested in or we're working with and give them a home while they're going from four to five people to twenty or whatnot. The landlords in New York are generally looking for a five-year lease. They don't understand or want to be involved with start-ups.

Tyler: They want to know what your credit history is, well we don't have one we're a start-up. What are your financials? Well we don't have one, and you have to sign for three to five years and again you don't know if the company is going to turn into, it's going to boom or bust or something in between.

Cameron: It's also a big headache. It takes the founders away from what they're doing. They have to look at all the spaces and they have to burn the precious cash, so we're trying to create a home where people can come in and sort of grow in it, and also leverage off the other people in that and create, if you want to call it, an ecosystem, that might be a good adjective. So that's part of the model and we'll sort of see where it goes from there.

Ryan: So you can't tell us anything, anything?

Cameron: We're looking at a company that's trying to solve sizing for online, you know when you purchase clothing online and I think that's an interesting place, especially for New York because New York is sort of the fashion center.

You've got New York and Paris and Milan, but it's sort of a good place to be, and I think that start-ups that are trying to solve problems in cities where they're sort of, the industry is really big around it, makes a lot of sense. There are just all those companies that they're going to be interacting with.

That's basically, a financial technology company, potentially a cloud company. It's kind of, it's a little scattered, but we find a good company and a good time, we like to bet on the jockey and not the horse. Usually the jockey will figure it out as they're going through the process. Yes, that's all for now, but if you invite us back, we'll dish.

Ryan: We'll definitely do that, I want to hear all the dish. To kind of go backwards in time now a little bit, I kind of want to talk about the elephant in the room, Facebook. If we don't get that out there, it's just going to sit there and everyone's going to ask, "Is he going to ask it?"

I kind of want to go back to the early scenes of ConnectU and how that evolved and how accurate was "The Social Network" in portraying that story?

Cameron: Sure, so with respect to the movie, "The Social Network", I think it was first and foremost a great piece of entertainment, I think it was a good film, and I think I can say that as objectively as possible. I also think it should have won best picture, but that's a different topic.

Tyler: Like the Citizen Kane of it's time, right?

Cameron: Do you know who beat out Citizen Kane?

Ryan: No, I don't.

Cameron: Who knows who beat Citizen Kane? Anybody in this room? What won best picture the year that Citizen Kane did not? "How Green was my Valley." Yes, we think it was that that should have won. Oh wait, "King's Speech", what was that?

Tyler: Yes, exactly.

Cameron: I think with the film, the goal, it is a non-fiction film, it's based on true events, there was a tremendous amount of research, and the filmmakers tried to be very sort of true to the actual fact pattern, but I think that what everybody needs to be sort of aware of is that the goal of the film was to tell a story from three different perspectives, similar to "Rashomon", sort of a reconstructing of the crime scene if you will.

As a result, the goal is not to draw a black and white conclusion, it's to create sort of a grey area where you can sort of grab onto any character and defend them and support them, and I think there's, you can't draw a definitive conclusion from the movie. You can do that and stay true to the fact pattern by just sort of not entering into the entire level of facts. Like, we believe that there are definitely documents and facts out there which make it much clearer what happened in the actual story.

But I don't blame the filmmakers for doing that. They made a good movie, and the conversation starts as you leave the theater, and so all the buzz and the blogs and the editorials, that's what the goal is, to create that discussion.

I think to rely solely on the movie as the sole authority on what happened during that eighteen month period would be mistaken.

Ryan: I've got to ask this for my friend Jonathan, what was it like having the best line of the movie? We're 6'5", 225 pounds and there are two of us?

Tyler: It's great. It's on our Twitter bio.

Cameron: One of them.

Ryan: To kind of take it back to ConnectU, you guys had kind of handed out, you guys were trying to solve a particular problem. What was your approach to that and how did that product actually develop?

Cameron: Sure, so we were getting through our junior year and we felt that once, at least at Harvard the way once you've chosen your major is you're kind of locked in this path. If it's computer science, you're kind of taking class with all these computer science kids and it's kind of hard to move right or left outside that path and meet too many other people. If you have a sport or some other extracurricular, you all of a sudden realize that you haven't met that many people in your class, let alone kids above and below you, so all of a sudden you're seeing the end of college getting close and closer.

I think one of the things that I had found was really, fun and great about the experience was all the people you meet. Because of geography and time constraints, we did not feel that we were even scraping the surface of all the kids in our class. We effectively sought out to create a technical solution to a social problem, and allow our fingers to do the walking on the keyboard.

When we started doing that, the only problem was there was no start-up culture or ecosystem there at the time. There was, I mean everybody was not looking anywhere near that space.

Tyler: Post-bubble, '99, so a lot of people had gotten burned. Our biggest problem was getting talent but for a different reason because everybody else was flying for it, but the talent wasn't interested in it.

Today it's a completely different system. Everybody has talent or the talent all have start-ups and they all have funding. You still have a problem finding talent, it's just for a different reason.

Cameron: You're competing against their own start-ups and their own ideas and whatnot. Back then, it was trying to find someone who saw the value in not doing as well on the computer problem set. We didn't want someone to fail out of school, but see the sort of larger picture of starting something that could be a business and go way beyond college.

Ryan: And for you guys, I just have to ask, what was it like finding out when you guys hit that tense point? What was that like?

Cameron: Which tense point? There are a couple of them. We found out by reading the newspaper which was kind of shocking, I mean we figured it would come a different way, so, I don't think it was a naïvete, it was definitely just you don't expect your fellow students to do that. I don't know if you guys have seen the whole pattern of e-mails, but it was 52 e- mails in three months and not a mention of, "Oh, I can't do this," or, "I'm doing something else."

It was like, "Things are coming along really well." It was like meditated beating off. We weren't supposed to see it coming and we didn't. We felt that we definitely had been wronged, and we didn't run to the courts immediately. In fact, we didn't even know what that all meant. We're not from a family with lawyers. In fact, our dad is a self-made guy who is a business guy.

We went to the administrative board at Harvard, based on honesty and stuff, and they didn't want to touch it, so we tried to meet with the president in the now-famous scene. That was actually office hours, and we waited in line like everyone else, and he couldn't see us the first time, and then so we went back a month later and he said "Go to the courts", so that's what we had to do.

Ryan: Was it like it was depicted in that movie?

Cameron: Yes, it was a lot like that. His leg, his feet were up on his desk and it was very dismissive and it was odd, because we were students at the time and we went to him mainly for a sort of mentorship and just to say, "Look, you might not be able to do anything but you should be aware that we're moving into a time where ideas are going to start being passed around. It's not just academic ideas anymore between a student or a professor or this or that."

You're dealing with a new future where kids are coming up with start-ups and the university hasn't really acknowledged or talked about any of this. They sort of exclusively focus on academic dishonesty, but if you take off the word academic, honesty is also important. It's no longer, and what might be taken or not might be worth hundreds of millions or billions, and he sort of had, seemed to have no time for that whatsoever, or interest.

I think not too long ago, about a week or two ago, Harvard is now looking into 125 kids who may have cheated or, you know, worked together on a take home exam. I think it's an issue that needs to be addressed and talked about. I don't know exactly the framework you use to evaluate it, but UVA really prides itself on their system which is a student-run honor code.

We've worked with or come across people who went to UVA and their conclusion is that the way Mark behaved with us, he would have been out of UVA before he could have even... There just would have been no debate, it would never have flown. I think anybody that you talk to from that university, they think that this is really and interesting, great thing that they have. So in any event, I think it's a dialogue that has not happened and needs to happen.

Ryan: Awesome. One last question about the whole time period. Mark Zuckerberg, wunderkind or just a crafty business man?

Cameron: Crafty thief?


Ryan: Well, I was trying to say it in a more diplomatic way.

Cameron: Thank you.

Tyler: I think you have to recognize the inherent growth properties of the idea, so now when you're saturated with a billion users, now it's really like, "OK, can we lead this? What's the leader going to do?" It was pretty much a thing we always felt that was going to grow as long as you kept the servers on and scaling it. And it did, because it's viral growth by definition.

Cameron: I think, yes, I think it was something where you just had to keep the electricity on and give it servers. Granted, there have been innovations. I think that the product has come a long way and you can't take that away from the company or the engineers that have been behind it, but the core... nobody sort of tries to pin a plague on one person.

It's got that viral quality and it spreads because of the nature of it, and I think that anybody here who's been on Facebook, who's uploaded a photo, who has made a friend request, you've grown that network. It's the people who built it. Nobody's sitting around, looking at Wikipedia and being like, "Oh Jimmy Wales, you're such a genius."

He created a platform and then everybody else then comes in behind and does the work. It's sort of, I mean granted, to go from zero to a billion users is great. They obviously didn't screw it up, but I think now is really when you start evaluating the leader and saying, "What are you going to do with these billion people? How are you going to harness it? How are you going to build a business, and I think it really starts today or three months ago and that's when a true leader is shown. You have to ask yourself if you were to take Mark and put him in another company, could he lead that company.

I think, that's a question, a lot of people would say they're not sure. I think if you took someone like a Jeff Bezos and you put him in Facebook, I think he can run that and figure that machine out. I think that a lot of people were very quick to ascribe this growth to one individual and I think that's just not the reality.

Tyler: I think we think it was a team effort, I mean he deserves credit, but I think we deserve some too, so that's what we're fighting for.

Ryan: Absolutely, absolutely. Get that credit. You guys have been around since Web 2.0 and all of this. I kind of also want to get your business perspective on the whole Facebook IPO debacle and shares trading less than $19.00.

Is there anyone to blame for that and what are some of the mistakes that other companies that are in the socials frame can avoid when they go to IPO or if they're even considering IPO.

Cameron: I think, I've got a couple viewpoints. One is that nothing was left on the table for the retail guys and everybody else who wanted to be part of it. I'm not saying that you should just give away shares for cheap, but people, if they're going to participate, you've got make them feel good about it and happy. If you're doing, whether it's an IPO or financing your next round, if you're totally jamming that valuation where the investors don't have a great opportunity to make a return, then maybe they're going to focus on another portfolio company and not go that extra mile to sort of build their relationships and help you out.

I think that there's wisdom in leaving something on the table. They clearly didn't. Why they didn't, you can make your own conclusion, whether it was trying to get the most out of it, greedy, being short-sighted, whatnot, but clearly people got burned and a lot of people backed off.

Until those people get comfortable with the stock again, I think you have difficulty simply from the technical aspect of this float and absorbing that.

Then with respect to the actual fundamentals of the business, I think that you have a situation where mobile was something that I think you could see a year out and so it's sort of confusing why it's all of a sudden now, "Oh we have to figure out how to monetize mobile." I think that that's an issue, I mean, if you're on that company, you should probably be seeing that coming a year out, two years out, knowing that you're coming up against this sort of cliff of having to go public. I mean I hear a lot of sort of discussion about oh well, we're focused on the user experience of the product, and anybody who's tried to use the Facebook iPhone app prior to the last release.

Tyler: It's been terrible forever, you can't use it.

Cameron: It's unworkable, right? So where's this product? I also think that there's no, sort of, there's not a lot of talk of trying to build a great business and sort of build a great product. I think the two go hand in hand.

In order to build a great product, you need to have the resources to plow back into it, and I think that nobody from Apple would be discouraged to say, "Yes we have a tremendous business, it's very profitable. We've got $100 billion worth of cash on our books." They're proud of that aspect.

I don't see Facebook describing themselves as trying to be a tremendous business and I don't see why you can't have both. I think that ultimately you need both, otherwise someone's going to come across and take your engineers, and they're going to eat your lunch and the product will suffer as a result. I think if you're trying to give the net end rest result to the users, you need to build an amazing business.

Ryan: And your thoughts?

Tyler: The same. No, they floated too much and it's like the Groucho Marx saying, "I don't want to be a member of a club that I can get into." Scarcity, I think that was a big problem, NASDAQ had issues. I mean hindsight's, it's easy to look back and to armchair quarterback it, but who's to blame? Everyone got caught up in this idea of users equals revenue and that's not quite the case.

Cameron: Anytime someone tells you it's different this time, it's not. It's a fundamental game, right?

Tyler: I mean the street wants fundamentals, and you're looking at a company that's trading at 30 times and you're looking at Apple or Google at 10 or 12 with real products, real history of revenue. I can see why investors are going one way versus the other. Can they figure it out? Sure, absolutely. It's not this huge mystery, but I think that certain things need to be done and people need to get more comfortable with it and it'll probably come back.

Cameron: The street's not as forgiving as the valley. The rhetoric's got to be pleasing to them, and if they don't hear the hard numbers and that kind of stuff, they're less likely to give it that wide berth that you might get if you are pitching a VC. "Oh, revenue will come down the road."

Wall Street doesn't want to hear that, and I think they miscalculated how much they buy into the sort of tech lingo kind of philosophy of long term, but long term in Wall Street is a couple quarters. If you don't figure it out, then you're guilty until proven innocent.

Amazon had a rough beginning and Facebook is certainly, I think that everyone, me included, thought it would be a little bit different. It's easy to always look back and say, "Oh this person doesn't point fingers."

I'm more concerned or more interested in how they're going to move forward and whether they have the right governance structure, the right team in place to do that. They're going to get a lot of at-bats, because they have the user base. It's just the question is, are they going to hit that home run?

Ryan: It's almost as if they have to actually start planning months in advance.

Cameron: In athletics, nobody, you train for the games at least four years out, but there's probably a decade of work before that. You know exactly where you're going and where you're trying to go. You can't, I mean, there's no such thing as being caught flat-footed and poor preparation. This is something that needed to be looked at a year or two years, I mean how can you not see it going mobile, right? I mean, the writing is on the wall, it's everywhere.

Tyler: The S1 filing was all about, they were even saying it was going mobile, but it didn't seem like they were preparing either. I think it's a little bit of a dilemma, too, with the governance because Saddam Hussein thought he had weapons of mass destruction right? That's the only way to rationally explain why he would put up such a fight and not let the inspectors in.

That was one theory that a journalist we talked to like, "Why did Saddam Hussein put up such a big fight?" If you didn't have them, let people come in and then go about your business being a dictator. Then he put up this big fight and we all know what happened, and one very rational explanation is he believed that he had them because his lieutenants were telling him he had them because he told them to have them.

They never did the job. It would have been off with their head instead of off with his head. It's like the emperor has no clothes. If you don't have the governance and the structure in place and the people who can challenge you and give the hard questions, and if you're not doing the job kick you out, I think you ultimately, that hurts your company.

Cameron: For sure, a dictator dilemma. Again, that's, you don't really, you're not getting necessarily the right kind of feedback and I think that investors are going to be hesitant about that structure. I don't know if we'll see it again.

Ryan: I want to make sure the audience gets their questions, so I'm going to ask one last question. How does it feel to be pop culture icons? Movie, animated on The Simpsons?

Cameron: I guess like people will a lot of times ask us what is it like to be a twin, and I'm like I don't know. I've been a twin my whole life. I can't compare. It's just something that happened. I guess we're in some ways flattered that people thought the story was interesting enough to make a film out of and go and see and pay money to actually see the story.

But there's a lot of great stories out there that will never be on the screen that are just as impressive or fascinating. We don't really take any credit for the actual film or all of that. It's just sort of something that happened. We embrace it. We believe the film is true, we believe our characters are presented in a pretty positive light. I don't know that we're exact carbon copies of those people. It is what it is and I think for better or worse, we're in that realm and we're okay with it.

Tyler: I mean we started, we set out to start a website in 2002, we would never would have predicted it would have gone this way. It did, we'll take it in stride. It's been exciting and again we're flattered that people are interested in the story and we're excited to start our next chapter.

Ryan: Awesome. Awesome, thank you for very much. I want to get questions from the audience. I see a lot of hands up. Yours is first and we'll get you next.


Audience Member: Just kind of a question about how you'll handle your investment, I guess how it evolved. Are entrepreneurs pitching both of you, is it a two-fer, is it a team decision, will you both be on all the boards or are you going to kind of divide and conquer or just kind of go your own way.

Cameron: I think a little bit of divide and conquer. I think on higher level things, we both are sort of kept up to date on what the other is doing, but we've sort of determined that it makes more sense for us not to overlap skill sets in one given place. I think we can cover a lot more ground, so that's sort of where we're leaning toward right now.

Tyler: I mean we're both, in terms of like, cutting a check, we're both equal in agreement. Then, we're more into, not just funding, but also company building. We'll probably take on less projects and try to throw our muscle behind it. It just doesn't make sense to, it's better to divide and conquer in that sense where Cameron might put a little more time or roll his sleeves up in one company and I might in another, but in terms of like whether we agree it's worth either one of our times or money, that's pretty much a unanimous decision.

Ryan: I see you had your hand up.

Audience Member: I don't know who you know on the investment board in terms of investors who were involved in Facebook at all, but did you come away with favorable opinions of the various players in that? Or maybe phrased another way, who on the investment side do you see as kind of portraying the ideals that you would have hoped to see in an investor in a start-up environment?

Tyler: I think that there's definitely guys out there with the reputations obviously vary considerably, and I don't really want to talk about people that I don't think have good reputations, but I think that a guy like, I've heard very great things about Fred Wilson at Union Square Ventures. I have not worked with him.

To be honest, we haven't done a lot of... we haven't met a lot of people in the actual VC space yet because we've been more meeting with entrepreneurs and investors.

What I do see is a lot of entrepreneurs are more interested in angel funding, at least initially. They're very concerned about owners' terms form VCs. And then the reality is a lot of VCs don't have, they're not looking at... they're looking for much larger checks to cut. I'm probably not the best person to ask on who the VCs out there that are really good to work with.

Cameron: The data points come up a lot, so I think that reputations do build, like we've heard certain things about certain people, but I wouldn't say anything without knowing them and dealing with them, but you see patterns.

Audience Member: In your situation, you didn't take away, you know, as shitty as this might have been for me, these guys were pretty good.

Tyler: Put it this way, right? If I were an investor in Facebook, there would have never been a movie, because the movie was the result of this long fight that they should have put to bed a long time ago. There was sort of an obstinance and I think some sort of, someone was, mostly in VCs and people I talked to said, "I just don't understand why this isn't something that they've wanted to settle and get put behind them way before."

It became such a focal point of the business later on, like years and years after. The movie came out in 2010, this had already been out for six years. That's something that if they had dealt with the parties ourselves and Eduardo Saverin, early on right away which I think pretty much everybody would tell you that's how to deal with it.

There would be no movie, there would be no distraction and it would all be about the business and going forward. I think the movie came about through Eduardo being disgruntled and having that falling out and them not working with him to find some equitable resolution. So that's the one thing I would say is I don't know why the VCs weren't sort of, they weren't advising him in that direction, but then that goes back to, perhaps, the dictator's dilemma.

Ryan: I want to get someone in the back. You, sir.

Audience Member: You guys both use a lot of sporting sayings. How does that prepare you to do business?

Cameron: That's a great question and I'm not just saying that. I really do believe that there's a tremendous crossover between athletics and the themes are very universal, and one of the sayings that I really like that I've heard coming out of the Harvard boathouse was, "Everything I learned in life, I learned at the boathouse and it had nothing to do with rowing," and what we see is the way in which we approach sport and what it taught us.

There are just, you just change the names, you change it from a sport to a company or a start-up and it's the same stuff, the same value set. We were involved with rowing for so long that it's sort of a part of us, but I think that you don't have to be at the Olympic level to get that out of a given sport.

I've talked to people who've rowed for, or done any sport for that matter, for a semester in high school or whatnot. What you take away from that, and the work and the planning and the dedication and all that stuff, is very similar. Everybody's been on a good team or a bad team, whether it's on the athletic field or in the start-up world and you realize how important that is. If you play golf with someone and they're kicking their ball out and not being honest with their score, how are you going to act in the business world? It's the same, the themes are very universal and it's impossible for me to not talk about- sorry.

Tyler: Just there's no guarantee of success, right? You train for a year at least, or two, and you might fall short. There's teamwork, your ability to take criticism, coachability. We really felt that rowing was such a microcosm for the world around us. There's no way I could have done it for almost 15 years, if I really didn't see it in everywhere I looked outside of rowing.

I think that it's also the intensity, when you're in a race and you're at 200 beats a minute, you've got a guy, everyone's kind of at each other, you see how people react in split second decisions that determine a year's worth of work, maybe four year's worth of work right?

It's kind of like a battle-tested ground at least in the sport of rowing and a lot of others and it's just also that accountability, that day in, day out, how people handle pressure, we just felt like we were totally equipped to get back into anything because of it.

Audience Member: Do you have mentors who you're tapping as you're transitioning into investing?

Tyler: Yes. We have good friends who are older and have different experiences. Definitely, I think it's really important too. Whenever we see something that we like, how hard is it to fire off five different e-mails to five people and just get a bead on what they think? And that's just basic due diligence, and some people you just value a lot more what they say, what they've done, or just you think they're a great soundboard. So we totally leverage our real-life social networks.

I think it's really important to, A, just getting more information. I mean there's a theory if you have your loose ties are also not as much like you as your close ties. Cameron and I, we see a lot of the same things, but maybe if I shoot an e-mail to you every month or something and we're just acquaintances, I get a totally different perspective.

It's important to not just rely on your close ties and your close friendships, but also people who are completely out of your element and in different spheres because what they'll see is completely different, their perspective will be different, so kind of make sure you also take that into account.

Ryan: You sir.

Audience Member: Given the history, would investing in a company that is leveraged on Facebook fit into your guys' investment concern? Like, an example would be would you guys have gotten further into the company?

Cameron: No, but for different reasons. Actually early, yes, but I think that it's a content business and you have to stay on top of what's hot and it's tough. You see that in the entertainment world all the time, people put together a movie they think there's a pretty built-in fan base and it's going to explode at the box office and it goes nowhere.

I think it's hard to call those things, but in terms of a business being built on a platform absolutely not. I think that if it's a good company, I think the reality is that many companies use that platform and are built around it, so I'm a little skeptical of being too much on top of it. I understand people using Facebook connect and using it for certain advantages, but having all your eggs on one basket, that's just they have a lot of leverage over you and your business and your outcome. I like to control the variables as much as I could.

Tyler: If you can't convince a person to sign up, if they're not compelled enough, or if the only way you're going to get them is pressing that one button or you see a lot of companies trying to trick or spam people into it, then you have to ask yourself is the company good? I think the most compelling companies people are very willing to register and put in their own information for.

Ryan: OK.

Audience Member: This is maybe a weird question, but you guys are coming from a very similar, you went to school together...

Tyler: We're cyborgs.


Audience Member: I'm kind of curious, two small things. One of them is how have you guys managed to do so many things together for so long? It seems like a certain point it would just be like, "You know what? I hate your face," and off you go.

Cameron: We have those points.

Tyler: So, Cameron's lefty, I'm righty, so that's a starting point. We really feel like we're very different and people who know us say that. He's a little more creative, goofy type. I'm a little more logical. I'm more likely to have my shirt tucked in kind of type. We definitely feel that we totally bring different things to the table. We might listen to a song and I might say I really like that and he doesn't.

The important things we're similar on, but we spend a lot of time rowing because there's one national team. We were on one team like we had to. There's guys I spent the same amount of time who weren't related to me, just because it's a small, the track is very narrow if you keep going to that level.

I think that we do feel there's a lot of differences. We're not only doing the same thing together. We're going to do divide and conquer type strategies just to build greater experiences and deal flow that brings back more of a positive angle. That's how I deal with it or how I look at it.

Ryan: OK. I want to get someone in the back, over there.

Audience Member: You guys went from being the founders of the company, in the start-up scene, being 100% involved with one company and really having that be your entire focus and then now you're moving into the venture side where you're getting involved with a lot of different companies.

Are you going to miss the whole start-up scene and the whole idea that it's your company, your baby, you're growing it, or are you kind of excited to do that partially with a lot of different companies.

Cameron: I think certainly there are elements to the start-up that you do miss, but there's also a lot of pressure and things that you have to do with a start-up that you don't necessarily want to do like tax returns and accounting and all that boring stuff.

The nice thing about investing is you can focus on the fun stuff and I think if you have a couple different companies that you get to still wear multiple hats but sort of focus on what you really like and find thing, but that being said I totally could see an opportunity or a company coming along where we say, "OK. Now I'm dropping the investment role and I want to just do this full time," but we're not there yet. We haven't sort of been pulled in that direction, but I wouldn't be surprised if we're back in that seat at some point.

Ryan: Yes.

Audience Member: I was actually going to follow up on your question but what I was going to say, you were talking about having an office space in New York and my experience running a start-up and being based in Europe is that anyone who is an American investor really wants you to be in America.

Are you giving start-ups the option to not be in your space if they're not going to be on your portfolio? In my experience, it's not always that good for innovation if you're always bringing your investors [being there]. Are you giving companies that option, are you saying, "OK. (inaudible 43:02) You have to come in."

Tyler: It's totally up to them. In fact it's usually the pull is coming from their side. They're out of a coffee shop and they want to start building some sort of culture and solidarity in the space. We don't believe in breathing down peoples' necks, and hopefully they get the feeling that, if they're there, we're not going to be those kind of guys.

I know how that can be, just in many other aspects of my life, like whether it's a coach that's too much on you, like "Let us go do our thing." So there's no requirement to do that. It's just a benefit of our dollars might, you know, we bring that and it's somewhere to go if you don't have that, but not at all. In fact, we hope that it's a stepping stone to growing out to your own space actually.

Ryan: Very good, that was all the time we had unfortunately. Please give a warm applause for our guests. Tyler, not Taylor, Winklevoss and Cameron Winklevoss, thank you so much guys.

Cameron: Cool, you look like you're having fun.

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