Episode summary
Bill Maris: How Google Could Crush AI Competitors, Why Small Funds Win, and AI's Atari Stage
All-In Podcast
· · 29 min · Hosts: David Sacks, Jason Calacanis, Chamath Palihapitiya, David Friedberg · Guests: Bill Maris
Summary
Bill Maris argues that venture works best when the fund is small, selective, and focused on financial returns rather than broader metrics. He says his new $150 million Section 32 fund reflects that logic, and he ties it to lessons from founding Google Ventures, where he and Rich Miner used historical data and machine learning to model portfolio construction and fund size. He says the strategy worked well enough that Google Ventures’ returns over 2009 to 2018 were about 4.1x by his estimate.
His core claim is that smaller funds outperform larger ones because they can concentrate attention and still generate enough exit value without needing unrealistic outcomes. He cites top-decile DPI data showing funds under $750 million averaging 4.76x versus 2.42x for funds above $1 billion, and he argues that large funds are structurally pressured into owning too much of too many companies. That, he says, also creates bad incentives for both managers and founders.
Maris is skeptical of the current AI valuation boom and says Google could crush competitors by cutting token prices sharply, because cheaper Gemini access would pressure OpenAI and Anthropic. He expects AI to move from an “Atari command line stage” toward richer, more ambient systems over the next five years, but thinks the real upside is in the enabling stack: physics engines, controllers, GPUs, and other infrastructure. He also remains interested in computational biology and deep tech, while warning that US anti-science trends and slower biotech regulation may push talent and capital elsewhere.
Key takeaways
- Bill Maris says a smaller fund lets him be highly selective and focused on financial return, which he thinks is the only measurable venture metric.
- He cites top-decile DPI data showing funds under $750 million averaged 4.76x versus 2.42x for funds above $1 billion.
- Maris argues Google could pressure OpenAI and Anthropic by cutting Gemini token prices, because cheaper compute would force a price war.
- He thinks AI is still in an “Atari command line stage” and expects major progress in the next 5 years through infrastructure, not just larger models.
- Maris says venture incentives are broken when huge funds can raise again after mediocre returns, even if smaller funds outperform.
- He remains interested in computational biology and deep tech, but says US anti-science trends may be pushing talent and research elsewhere.
Notable quotes
“With a smaller fund, I have the advantage to be very selective in the companies that I invest in, the people that I hire”
“Any other metric is impossible to measure and therefore won't succeed”
“I think we're at the Atari command line stage of of AI and we're going to get to the, you know, PlayStation 10 stage in the next 5 years”
How the episode opens
After saying he was out, now Bill Maris is returning to the investing world. The founding CEO of Google Ventures has raised $150 million for his new fund called Section 32.
With a smaller fund, I have the advantage to be very selective in the companies that I invest in, the people that I hire. We're going to invest for a financial return. Any other metric is impossible to measure and therefore won't succeed.
Think of the change that has happened just in the last hundred years and what's about to happen in the next hundred years with the advent of AI. The world is going to change by orders of magnitude.
Thank you very much for that uh warm welcome. I am Bill Maris. I'm the founder of section 32.
Prior to that, I was the founder and CEO of Google Ventures. I was also Google's vice president of special projects where I incubated Whimo and Google X Calico uh uh and many other uh projects as well. Uh and before that I founded a web hosting and data center company uh which we're going to talk a little bit about.
Um and uh today I think I'm going to talk to you about a few of the lessons I've learned on these interesting experiences I've had uh in life. So, we'll start. We're going to have four lessons I'm going to talk about.
And we're going to go back to 1997 to start when I was a uh fresh college graduate. I had a degree in neuroscience. Uh and I found myself on Wall Street.
Uh somehow managed to land a job there, but I was miserable having to wear a suit uh and trudge to work in the heat. But one good thing came of that which was I looked in the closet of the office one day and I saw a server and I asked, "Well, what is this thing beneath our jackets?
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- ai competitors
- small vc funds
- openai valuation
- ai price war
- vc incentives
Companies and tickers mentioned
- GOOGL
- GOOG
- OpenAI
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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