Lessons from Shaun Maguire

A titan in the world of venture capital, Shaun Maguire, a partner at Sequoia Capital, is known for his investments in trailblazing companies and his candid, often contrarian, viewpoints. With a background that spans from a Ph.D. in quantum gravity to co-founding a billion-dollar cybersecurity firm, his insights are sought after by entrepreneurs and investors alike.

On Startups and Founders

On identifying promising founders: "I like high-IQ founders. But even more important to me is someone that's just irrationally motivated. For whatever reason, it's their life mission to try to revolutionize the industry they're going after... The best founders are just so obsessed with what they're doing that they cannot turn off." [1][2]
On the importance of a founder's knowledge: "One of the things I'm looking for is for founders that know more about their industry than I do... you just start to learn a lot about a lot of different industries and it... it's really there's a lot of times like you know I got pitched recently by a founder who had a fatal misunderstanding of their industry. and you know when that happens like you're just you're not going to invest." [3]
On making tough personnel decisions: "A friend of mine has a saying: 'When there are doubts, there are no doubts.' I think that's good advice when it comes to deciding whether or not someone is additive to your culture; if you're having doubts about their role in the company, it's probably already time to part ways." [4][5]
The cost of keeping the wrong person: "Waiting too long is such a common mistake among founders... if you have someone on the team who's pulling down morale or even making it harder to recruit, that can damage the trajectory of the entire company. It's much better to take action quickly." [4][5]
On supporting founders through low points: "Just being an ear for someone in a situation like that can make a big difference. I try to help them focus on the three things that matter most for the next month or quarter, or just offer them a more objective perspective." [4]
On the power of persistence: "Sometimes quitting is the far bigger risk, because you'll always wonder what could have happened. But if you keep going, the worst case scenario is that you'll be in essentially the same position a few months from now—and the best case scenario is that those few months make all the difference."
The value of pre-work for fundraising: "There's a lot of pre-work that goes into how seriously someone takes you... that was actually the most important thing for us was the story of what we had done the few years before and how seriously that led people to take us." [3]
On founder empathy in venture capital: "I'm starting from a place of like a lot of founder empathy... and that's just like a strong advantage as a VC... and it deeply shapes how I like act as a VC." [6]
The dual responsibility of a VC: "As a VC. it's important to do your fiduciary duty which is like trying to maximize shareholder. value it's also important to have founder empathy." [6]
On empowering talented individuals: Elon Musk "is willing if someone is really talented. and they say they can do something he'll let them do it even though it would never. be like like you should never from just the person's resume or background. give them that job or opportunity or responsibility." [6]

On Investing and Technology

On being counter-cyclical: "I deeply believe in being countercyclical... when you're going with the herd. you're just one of a million. and it's very few people have actual edge. there a year ago crypto was all the rage. it was not a great time to go like jump into crypto the better time was to do it when it was the backwater." [7]
The future of technology: "From AI and silicon photonics to humanoid robots and space infrastructure, Shaun makes the case that the next 20 years will make the internet boom look tame." [8][9]
On the return of hardware: "I wrote a manifesto for Sequoia a few years ago... it's a hardware manifesto i've been obsessed with hardware my entire life... if you look at Sequoia. Sequoia made almost all of its money the first 25 years on hardware. investments." [10]
On investing in hard tech: "Investing in hard tech vs. software." [10]
The importance of market dynamics: "Market is probably the first thing I think about and then and like not just there's a market is not enough like there's a lot to market you got to think about the size of it you got to think about... the dynamics of the market are there are the incumbents. really sophisticated. and like real competition or not." [3]
On the timing of market entry: "Something can happen like the cloud can get created. but it may not be the right time for to build like the cloud security business for another 15 years you have to wait for maturity of the market and all that and I think they just timed the maturity perfectly." [11]
On the potential of the space economy: Through the process of building a self-sustaining city on Mars, "all of the second and third order businesses that are going to get created is is going to be incredible for example like SpaceX is going to have to figure out vertical or some other companies going to have to figure out vertical farming going to have to figure out. energy." [12]
On the future of AI security: "The real AI security threats haven't emerged yet... What stood out about the Irregular team is how far ahead they're thinking. They're working with the most advanced models being built today and laying the groundwork for how we'll need to make AI reliable in the years ahead." [13][14]
On decentralized platforms: "They believe that an open, blockchain-based organization where the direction is set by the community with no corporate entity to compete with — or be shut down by — will outcompete social media's traditional ads-driven business model." [15]
On the value of a prepared mind in investing: "A lot of times in life you have to acknowledge when you're lucky... and look half of it was having a prepared mind because I had started a field space launch company and I knew a lot of physics." [6]

On Personal Philosophy and Learnings

On the importance of staying calm: "I would have been much better off staying calm. I think the same is true in business, even when you have a legitimate reason to be angry... It stops being about getting the best terms for both sides and turns into a prisoner's dilemma, where everyone's working against each other." [5]
On the power of asking "Why?": "I just ask 'Why?' It's my follow-up question for everything... it's such a good way to get past the canned responses. When you ask 'Why did you make that decision?' or 'Why did you do it that way?' it helps you understand how someone thinks."
On the value of travel: "I spent one night sleeping in a meadow in Syria. I got stuck in the Chaco desert for a day and a half with no water after our bus broke down. You learn to just figure it out. I also learned to be much more trusting."
On following your curiosity: "You can't fake extreme curiosity... one thing that. I have done well is I've been willing. to I've been willing to follow my own instincts with my curiosity. and this has oftentimes had great short-term. cost." [6]
On taking risks to learn: "The times when you actually learn is when you're willing to go into the fire like or when you're willing to really like take a risk... you have to be a little bit uncomfortable to actually learn." [6]
On his unconventional path: "I did horribly in high school. Bored out of my mind. I didn't even go to class most of the time—1.8 GPA in 10th grade and an F in algebra II. I was doing projects on the computer, hanging out in hacker forums for 10 hours a day in IRC." [1][2]
On the formative years: "Your late teens and early 20s are the most formative. part of your life. and so to spend a few years working on on like an Afghanistan project and and a few months there in theater. it it changed everything in my life." [6]
On being unafraid to speak his mind: "When October 7th happened it was a moment in my life. where for a variety of reasons I felt like... i couldn't agree more i think we're at basically a low point in the truth in our lifetimes." [10]
On his motivation to speak out: "I was at a point in my life where I had sold a company for a billion dollars... I had made enough money to where if I got fired... I wasn't going to starve to death and that's a very lucky privileged position but you were unafraid i was unafraid." [10]
On the importance of intellectual curiosity: "Shaun's academic journey was driven by curiosity, not career ambitions, indicating a deep love for learning." [16]

On Geopolitics and Society

On the strategic risks of outsourcing: "We also had been in a 30-year outsourcing phase of outsourcing. our manufacturing... specifically to China but all over the world... which I think runs huge strategic risks in the future." [12]
On the importance of domestic manufacturing: "People are less afraid of you militarily when you don't make anything at home." [12]
On the US's global strategy: "The right strategy for the next 30 years is a lot more hunkering down than it was the last 30 years i think we bit made a big mistake. of being too loose with our chips the last 30 years." [10]
On the state of media and truth: "We basically have had a phase transition in Western. media... I think Fox News. like defected in prisoners dilemma... once they defected CNN defected and then everyone defected."
On free speech: "Does Shaun believe we live in a society with freedom of speech? How does it differ between the US and Europe?" [17]
On his support for Israel: "I love Israel i'll fight for Israel forever. and um I I view this fight is not just for Israel. it's for the whole West with Israel being the tip of the spear." [18]
On investing in Israel during difficult times: "The best investors make their biggest bets in difficult times. During COVID-19 in 2020, we at Sequoia recognized that Israel's startup ecosystem had entered a new phase... So we doubled down and invested heavily, knowing the opportunities were there." [19]
On his controversial comments: "Mamdani comes from a culture that lies about everything... It's literally a virtue to lie if it advances his Islamist agenda. The West will learn this lesson the hard way." [20][21]
His defense of his statements: "People have lost the plot... 'Islamist' doesn't equal Muslim, but still called Mamdani an Islamist along with 'Hezbollah, Hamas, Al-Qaeda, ISIS, The Taliban, The Ayatollahs in Iran.'" [20]
On cancel culture: He decried the open letter against him as an example of “cancel culture.” [22]

On a Variety of Other Topics

On the importance of ambition: "My goal is that Israel creates at least a $1 trillion company over the next decade or so. I think that would truly revolutionize the economy. I think Israel can build companies even bigger than Wiz. But that requires ambition." [19]
On pursuing genuine passions: "The people I know that are the happiest. and most successful are people that have pursued their like true genuine passions you know that are oftentimes. esoteric." [7]
On the unifying nature of exploration: "Humans are at our best when we're exploring. It's a very unifying experience." [4]
On the necessity of space exploration for humanity's future: "I personally believe that eventually, we're going to have to become a space-faring species. Maybe not to survive the next hundred years, but certainly the next thousand." [4]
On the importance of talent concentration: "In Israel kind of the people that really rise the top in the army. they concentrate talent in an in a really really insane and incredible way... and I think that's just like a core property for building great companies." [6]
On the evolution of the cloud security market: "By 2020 cloud was like the first class citizen it was by far the most important thing to secure. and no one had everyone before had had us including my own company like we started with an on-prem solution then we started to bolt on a cloud solution and our cloud solution wasn't very good." [11]
On the future of X (formerly Twitter): "The company has had to since the take private. there's been like a few years of like fixing the foundation of the company. and we're starting to enter the era where like the foundation is strong and they get to now like actually build on top of this new strong foundation." [11]
On the importance of minimizing civilian casualties in war: "In any war. I think it's very important to minimize all civilian casualties. and as much as possible but war can simultaneously sometimes be necessary." [6]
On when to speak out on controversial topics: "It's not worth jumping in on a controversial topic if you don't have any anything additive to say. and then you have to be willing to live with the consequences. if something goes wrong." [12]
On his parallel passions: "I've always been doing multiple things in parallel my whole life. There's not one moment in my life where I wasn't doing three or four things, all at a relatively high level completely in parallel. It's just how I am wired."

Learn more:

Lessons from Shaun Maguire

On Startups and Founders

On Investing and Technology

On Personal Philosophy and Learnings

On Geopolitics and Society

On a Variety of Other Topics

Written by Antoine Buteau

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