Hi, everyone. Another grim week. The plain truth is that we have got to stop selling weapons of war to random civilians.
In 1727, 21-year-old Benjamin Franklin invited, as he put it, “my most ingenious acquaintance[s] into a club of mutual improvement.” He dubbed his new club the Junto, after the Spanish word for “join.” On Friday evenings Franklin and the dozen Junto members (all men, of course) would meet in a Philadelphia tavern to discuss topics of morals, politics, or national philosophy, conducting debates “in the sincere spirit of inquiry after truth … without fondness for dispute or desire of victory.”
Almost 300 years later, I Zoomed into a study group inspired by Franklin’s colloquies. It consisted of budding tech founders discussing Web3. All the virtual attendees were young and super serious, and all seemed to have completed the assigned technical readings on subjects like token velocity and the design space of liquidity mining. Even though the meeting was taking place just as the Luna stablecoin was imploding, the seminarians dismissed this crisis in the crypto world as a passing distraction. The important thing, they agreed, was creating products that people want to use, not playing growth games with tokens.
Sober long views like these might be the defining characteristic of South Park Commons, an ambitious incubator program that, for seven years, has been running this ongoing seminar and many others like it, including fireside chats with tech luminaries, panel discussions, and demo days. SPC has had relatively little public exposure to date, despite launching more than 150 startups and investing in companies with a total worth of $35 billion. The low profile is in keeping with the project’s highfalutin tone: In a tech ecosystem where ideas and seed funding are almost simultaneous, SPC concentrates on giving its 450 members a thoughtful foundation in a specific domain as well as an understanding of societal impact long before the first elevator pitch. “People come to SPC because they want to take time to be sure about what they do next,” says Samantha Whitmore, a machine learning scientist who has been auditing the Web3 seminar and is getting close to utilizing those learnings to launch her own company.
The creators of the program are Aditya Agarwal and Ruchi Sanghvi, who met and married as early Facebook employees—Sanghvi was the original program manager for the News Feed—and went on to executive posts at Dropbox. In 2015, after taking a breather, Sanghvi recognized a void in the high-octane startup world—a safe haven for talented tech entrepreneurs to acquire deeper knowledge and domain expertise as they contemplated their next company. The couple decided to start that kind of startup incubator. They looked to the Junto alehouse sessions as one of their models, as well as Franklin’s admonition that “great haste makes waste.” Other incubators take founders from zero to 60 in no time. SPC focuses on prequel territory, taking members from –1 to zero, on their own time. Along the way, founders would acquire knowledge to make them better leaders, maybe even less obsessed with being the next Travis Kalanick or Adam Neumann. It’s what Franklin might have set up if he were a venture capitalist.
“In the technology industry everyone basically jumps into the next company or begins a startup and spins it up in three months,” Sanghvi says. “But deep tech takes a little bit of time. Nobody seemed to be making that time and space to build those kinds of companies.”
Like Franklin’s Junto club, SPC started small and informally—10 or so people around the Sanghvi's dining room table. But the meetings quickly moved to a dedicated space off San Francisco’s South Park (thus the moniker), when the project officially launched in 2016. Now there’s also an office in New York’s SoHo district as well. Sanghvi and Agarwal set up a membership structure that asks for a commitment of time and intentionality from the idealistic, young, and technically-oriented people who apply. Still, they reject nine out of 10 applicants. In 2018, SPC began funding some of its participants, with the idea that some of the money would go to an endowment to keep the project going. SPC also encourages its members, if they are accredited investors, to participate in the funding. More recently, SPC started a fellows program that gives $400,000 to would-be founders cogitating what might turn out to be business plan; when and if they do, the money converts to an investment.
It might sound like SPC’s approach implicitly rebukes that of move-fast incubators like Y Combinator. But the two models are not mutually exclusive. At a recent meeting in SPC’s SoHo office—with a panel discussion called “How to Build Confidence and Start a Company”—I met a cofounder of an NFT company who painstakingly nurtured the concept at SPC and then joined Y Combinator for a product sprint, presenting at Demo Day last March.
As one might suspect, crypto is a big topic at SPC these days. The company has even set up a decentralized autonomous organization to handle some of its investments. Sanghvi admits that even some SPC members have wondered whether the operation is getting too focused on the blockchain. But she regards it as a normal part of technology cycles. “Technology goes in waves,” she says. “It’s a crypto wave now, but in 2017 it was an AI wave.”
Still, I wonder what the author of Poor Richard’s Almanac would make of crypto. One hint from 1733: “Fools make feasts and wise men eat them.” As for Franklin’s Junto club, it suffered from growing pains that SPC might learn from. As the word spread, friends of the members kept pressing to join. Franklin was opposed to expansion but came up with an alternative: Each member of the collective should start his own club, adhering to the principles of Junto without the branding. This had mixed results, as many of the secondary clubs flopped.
Sanghvi says that while she hopes South Park Commons makes its own mark in the world, she doesn’t want to spread it too thin, even as it expands from San Francisco to other cities. “I want SPC to remain bespoke,” she says. “To make sure it’s not transactional and not a machine. The key legacy will be to give technologists space and support to think about problems and solutions at a deeper level.” As the tech world faces a possible recession, slow startups might be just the thing.
South Park Commons has been under the radar until recently. In 2007, that was still the case for its now-celebrated antithesis, Y Combinator, which seemed a novelty when I wrote about it for Newsweek. At that point, YC was hosting a dozen startups in the three-month program. Now it’s more than 400 in a batch, and each company is staked $500,000.
Y Combinator is “American Idol” meets WIRED magazine. The inspiration came from Paul Graham, a high-energy 42-year-old who himself had a monumental startup experience, selling his company Via-web, an ecommerce application, to Yahoo at the height of the boom, enriching himself and his buddies. In the spring of 2005 he made a speech at Harvard that was a broadband update of Horace Greeley ("Start up, young man!"), then realized that he could help make it happen for others. He gathered his former partners—Trevor Blackwell, now making robots, and Robert Morris, who achieved brief notoriety in the 1980s as the author of a virus that almost shut down the Internet—and recruited another friend, an investment banker named Jessica Livingston. They drew up the plans for an operation: from hundreds of applications, the YC partners would cull the 30 most promising, conducting "Idol"-style auditions to choose a dozen or so companies for the program. Each startup is given $5,000 plus $5,000 per founder (a startup with two founders would get $15,000). This money covers lodging, food and equipment during the program. In exchange, Y Combinator (named after a mathematical function) gets a piece of the startup, usually 5 or 6 percent.
Some critics scoff that Y Combinator's investment is peanuts for that amount of equity. But the opportunity is unparalleled—total immersion into Silicon Valley startup culture, advice from Graham and a fast track to the top angel investors and venture-capital funds. When Graham calls the winners, the founders have only five minutes to accept. “If people turn us down,” he says, “as far as we're concerned they've failed an IQ test.”
Konstantin asks, “What would happen to the world if we ran out of electricity?”
Thanks, Konstantin. As I suspect you know, electricity is not like oil or baby formula—you don’t just run out of it. Because we get electricity from multiple sources—mostly fossil fuels but also nuclear power, hydropower, wind, and solar—presumably even if the oil market blows up, we could eventually replace it. I suspect you’re asking what might happen in the meantime. As people in Texas learned when their power grid broke down in 2021, even a short-term blackout can be catastrophic. The phones don’t charge, the air conditioners are useless, and the toilets don’t flush. We might even miss the season finale of “This is Us”! Within a few days, life takes an apocalyptic turn, and we wonder how much our putatively advanced civilization hangs on a gossamer thread.
Could centuries of progress be reversed by some kind of atavistic scenario where electricity isn’t available for an extended period? The fate of most of us, maybe even all of us, would be dependent on society as a whole working collaboratively to make sure everyone had access to essential services in our newly primitive civilization. If you consider our current state—divisiveness, nativism, and, at least in the US, people armed to the teeth—it doesn’t look so great. But an optimist might propose that, like electricity, human kindness is not something that just “runs out” and that people would pull together during the disaster you imagine. If you want more ruminations on this, check out the hundreds of novels published recently that envision a dystopian future. Many of them include green shoots of hope.
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