LendUp is founded on the belief that diverse perspectives and a culture of inclusion are vital to realizing our goal of delivering financial opportunity and inclusion to all Americans. In fact, “different backgrounds, same mission” is one of our six values.
LendUp’s LGBTQ + Allies group invited Y Combinator (LendUp investor / how we got our start) President Sam Altman for a conversation on Silicon Valley, fintech, and being a member of the LGBTQ community as a leader in business and tech.
Below is a condensed overview of Sam's remarks.
How has your identity as an LGBTQ individual shaped your experience in the tech industry?
I grew up in the Midwest, and at the time it was not great to be gay there. I knew I wanted to come to California, partly because people said it was an OK place to be gay, and also because I wanted to study computer science and had a lifelong dream of going to Stanford. Since coming here, there have been rare edge cases where being gay has been an issue, or I’ve felt uncomfortable taking my partner to a work function. I don’t think the tech industry is perfect on diversity, but on this issue I think a lot of people in tech are really open-minded. It’s a fairly embracing community, and I’m thankful for that.
Also, I’ve always been out. I’m part of the first generation where a lot people came out in high school. So I didn’t have this experience of coming out professionally, though I’ve heard about it. Being gay is one small part of my life, and never something I’ve had to hide. And it’s just kind of always been -- since I’ve been in California, at least -- accepted, and just part of “me.”
Given there’s actually quite a few openly-LGBTQ tech giants, what can we do to promote more positive visibility of LGBTQ people in the community?
I think outside of Silicon Valley Tim Cook is the one people know of. That’s pretty cool. Arguably the biggest company in the world, and certainly the biggest tech company, is run by an openly gay guy. I think that inspires a lot of gay kids to think they can go into tech or business, and that’s great.
How would you advise startups and even larger tech companies to more effectively diversify their teams and to foster an environment of inclusion?
I think it’s always difficult to legislate away prejudice, hate, fear, or anything like that. If you look at a lot of the social progress we’ve made in the country, it’s not because we passed laws. That doesn’t change people’s hearts and minds.
The thing that works is bringing people together, exposing people to different backgrounds. I’ve personally had the experience many times of someone saying, “well I thought I didn’t like gay people, and I thought gay people were scary, but I got to know you and you’re cool so -- I guess I’m ok with this.” There was a big breakthrough in the U.S. after WW2 -- it brought people together from many different backgrounds, and it was through building those personal connections and bonds that we came together as a country. That is very valuable and we don’t have enough of that as a nation anymore. I think we’re getting refragmented.
This looks like a very diverse room. It’s hard to tell just by looking at people, but it’s clear there are a lot of different backgrounds represented -- and that’s how progress gets made. I think that San Francisco has generally done this well, but could do more. LGBTQ issues aside, Silicon Valley and the tech industry generally still face severe challenges with diversity. There are a lot of people who talk about it, but it’s a challenging issue. I think one of the highest impact things we can do to diversify the tech industry is to fund more diverse founders, because companies tend to be a reflection of their founders and their founders’ networks. That’s certainly something we’re trying to do at Y Combinator. I’m confident we fund more female, Black, and Latino founders than any other top fund.
What else is important about your background and your path to YC, and what are you focused on now?
After Stanford (I dropped out), I started/sold my first company, then ultimately became an investor. I didn’t like being a venture capitalist in the traditional sense. It felt like I was creating minimal value for the world, and just trying to find already-successful companies and convince them to take my money. But I did learn that I like teaching, and advising and helping people start companies. I also realized that there were big classes of companies not being started.
When I was a little kid, I actually said I wanted to build Artificial Intelligence -- though I got distracted from that for a long time. Today, the issues I care about the most, in terms of being good for the future of the world, are AI, energy, and biotechnology. I’ve focused personally, and have tried to orient YC to an extent, on these areas. I’m the chairman of the board of a nuclear fusion company, and I hope we’re going to get net gain fusion in the next couple of years -- that’s going to transform the world. I co-chair OpenAI, and I think we’re going to create superhuman AI in the next few decades. And on the biotech side, I think we will see, in our lifetime, almost all current diseases get cured.
Our motto at YC is “make the future great for everyone.” Our goal is to figure out how to use technology to have the maximum impact on the world. Often that’s funding startups, sometimes it’s setting up large-scale nonprofits like OpenAI, and sometimes it’s like our basic income experiment or getting involved in politics. But as a general point we are focused on using tech as a lever to make life better for everyone.
How do you envision Y Combinator’s basic income project working and what are the largest challenges you see in rolling out similar models more widely?
We are on the cusp of a technology revolution on the order of the Agricultural or the Industrial Revolution, where we’ll see perhaps ~75% of current human jobs change in a short period of time. Automation will soon do basically all repetitive work better than humans can, other than jobs where the human emotional element is really important, like with teachers or caregivers. So we’re going to create giant amounts of wealth with AI and automation, but it’s going to be really concentrated and a lot of existing jobs will go away.
I’m actually more bullish than most people on what happens on the other side of this. I think human desire is limitless and we’re going to find new things to want to do. It would have been very hard 100 years ago to even predict computer programming as a job. I don’t know what the jobs will be, and while I’m confident they’ll be there, I do think we’re going to have a rocky transition because it’ll happen so quickly. I also think a huge amount of human potential is currently wasted as people have to try to figure out how to get something to eat or where to sleep. Government services to those ends have traditionally been fairly inefficient and poorly-allocated.
I’m intrigued by the idea that when this automation comes, it’s true it will eliminate jobs, but it will also drive down the cost of a high quality of life if we just give everyone the money to take care of their basic needs. I think most people will still find things to do. This may look different than what we think of today as far as earning money to live on. But this idea where we basically just take care of people’s basic needs, and we view that as a human right, is an interesting idea. And this is what YC is trying to study now -- the question of how people will spend their time and get their community and status and fulfillment is really important to our future.
What big problems is the rest of the U.S. focused on that you think are blind spots for Silicon Valley?
One thing I think Silicon Valley is missing, and to be fair we can’t solve it ourselves, is how we address the cost of housing. When things worked well, you could buy a house -- one where people want to live and one that’s near jobs -- for 2 years’ salary. That seems crazy to people now. Young people feel like their future has been stolen from them because they will never be able to get a solid financial footing. The cost of housing has been this huge intergenerational wealth transfer from young people to Boomers. And if you can’t reverse or stop that, it’s hard to say how any of the other things the tech industry does have an effect. People just feel like they never have an opportunity to get ahead, or to try for this “American Dream.”
I also think we need a big change to the education system. The world has changed so much, but the education system still teaches like it did in the 50s. Memorization just isn’t important anymore -- we all have Google. But learning how to work with teams and with tech, learning how to come up with creative new ideas -- those things are really important. Schools were very good at teaching people to go work in the same big job for 40 years -- but no one does that anymore. And so when people say they’ve lost faith in the institutions of America, it’s because it’s not clear they still work like they once did. I don’t think the most important thing education teaches is specific skills -- those will always be out of date. The most important thing that I learned in school was that there were some things I was really passionate about and some that I wasn’t, which is OK. I learned how to learn anything quickly, and I learned that I loved to learn. That’s what an education system is supposed to teach. We’ve moved steadily away from that in US education in the last number of years.
A lot of times throughout history you look back on things and say -- how could people have been so complacent during times of such ridiculous injustices? What do you think is today’s?
I think we should set the goal of ending poverty for Americans within the next few decades. The fact that we have people literally dying on the streets, who don’t have enough to eat and can’t get mental health treatment -- that’s going to look pretty barbaric looking back. Also our criminal justice system. Seventy million people in the U.S. have a really hard time getting jobs because they have a criminal record, and they’re kind of just left to this reinforcing cycle of more crime, because we aren’t good at rehabilitating people who have made a mistake.
What role do you think tech has in finding solutions for these issues vs. looking to government to solve these problems, as we traditionally have?
I’d like to see more people from the tech industry getting involved in government. There are a lot of people in tech who say, “well we’ll just do this outside of the system.” But the system needs some help too. I think the problem is that the political system -- this two-party, antagonistic thing -- has gotten so intense and so bad that people just don’t want to work in it. I see a lot of people who really want to work on these issues but don’t want to be involved in government. And I think that’s bad, but I don't have a great prescription for how to fix it.
I do think tech has a real responsibility to help solve many of these issues, because tech is partially creating the problem. If tech automates away 75% of today’s jobs, then says, “well, the rest of you can figure out what to do with that” -- that doesn’t seem fair to me.
What’s YC’s perspective on being in Silicon Valley if you want to start a technology company?
YC is actually pretty decentralized. Most of the companies we fund are from outside of Silicon Valley, but they come for a little while then go back. We do still have them come here. Silicon Valley doesn’t have smarter people or capital. The magic is this relentless sense of optimism and belief in the future. And it’s an environment where good ideas don’t get killed by someone saying “that’s never going to work” or “that’s too ambitious.” The reason we bring people here and the reason they seem to like it, at least for a short period of time, is that you get infected with a sense of “I can do anything.” Then you take that back with you and you spread it among your community. So our not-so-secret-plan is that if we get them here, infect them with that idea here, then let them go back home -- that’s how it gets spread around the world. That’s the important thing, that cultural mindset, and that’s changing the world.
LendUp’s LGBTQ + Allies group organizes programs for anyone at the company interested in getting more involved in the LGBTQ activist community, creating a positive work environment, encouraging diverse perspectives, and fostering a culture of inclusion.