Episode Summary
Executive Summary: In this March 20, 2020 episode of This Week in Startups, hosts Jason Calacanis, Alex Wilhelm, and Sarah Cannon discuss the COVID-19 pandemic's impact on health, economy, and society. They analyze the U.S. response, propose economic stimulus measures (cash transfers, paid sick leave, small business loans), debate the feasibility of returning to work with hygiene protocols, and explore the crisis's implications for tech startups, venture capital, and societal trust in institutions.
Main Topics: COVID-19 Crisis Overview and U.S. Response (Priority: 5/5): Discussion of the pandemic's human toll, testing failures, and the need for a national quarantine. Criticism of the federal response and comparison to other countries. Economic Stimulus Proposals (Priority: 5/5): Sarah Cannon advocates for direct cash transfers, paid sick leave, and zero-interest loans for small businesses. Debate on universal basic income and automatic stabilizers. Impact on Startups and Venture Capital (Priority: 4/5): Analysis of how the crisis affects startup funding, SaaS durability, and investor behavior. Discussion of portfolio company support and new investment opportunities. Societal and Behavioral Changes (Priority: 4/5): Exploration of long-term shifts in hygiene, personal space, government trust, and media consumption. Debate on the feasibility of returning to work with testing and temperature checks. Media and Political Dynamics (Priority: 3/5): Critique of media coverage, the role of Twitter, and political polarization. Discussion of how misinformation and partisan narratives affect public response. Personal Coping and Mental Health (Priority: 2/5): Speakers share their experiences with quarantine, extroversion, and maintaining social connections through technology like Zoom.
Key Arguments: The U.S. underreacted to COVID-19 due to lack of testing and a slow federal response; a national quarantine is necessary. Economic stimulus should focus on direct cash transfers to individuals, paid sick leave, and small business loans, not bank bailouts. The crisis will reshape societal trust in government and institutions, but lessons may be forgotten post-crisis. SaaS companies with essential products and inside sales models are more resilient; those reliant on enterprise on-prem sales will struggle. Venture capital firms should support portfolio companies' employees first and consider investing during the downturn. Returning to work requires mass testing, temperature checks, and behavioral changes (hand washing, no handshakes), but American individualism may hinder compliance.
Data Points: U.S. COVID-19 cases: Over 17,000 - As of March 20, 2020, with cases doubling every few days. Italy death toll: Almost 6,000 - Surpassed China; 500 deaths per day at peak. Global cases: Quarter million - With 90,000 recovered and over 10,000 dead. Goldman Sachs Q2 growth forecast: Negative 24% - Quarter-on-quarter contraction for the U.S. economy. Uber unrestricted cash: $10 billion - Cited as a buffer ensuring survival through the year. Proposed stimulus size: $3 trillion - Total stimulus discussed, with $200 billion for direct $2,000 checks to 100 million people.
Pivotal Quotes: "We have the exact wrong person at the wrong time. We have an illiterate narcissist when we need to have a literate person of empathy." — Alex Wilhelm: Criticizing President Trump's response to the pandemic. "The tying of benefits to employment is fundamentally broken and has never been a system that's worked." — Alex Wilhelm: Arguing for healthcare and benefits reform in the gig economy. "I think moments like this remind you why you need collective measures... why you need healthcare institutions and the CDC to be funded." — Sarah Cannon: On the silver lining of restoring faith in government.
Implications: The podcast underscores the need for aggressive, targeted economic stimulus and a coordinated national response to COVID-19. For startups, cash reserves and essential products are key to survival. Long-term, societal trust in government and collective action may increase, but behavioral changes may be temporary. Investors should support portfolio companies and consider counter-cyclical investments.
About This Week in Startups
Jason Calacanis covers startups, tech, markets, media, and all the hottest topics in business and technology. He also interviews the world’s greatest founders, operators, investors, and innovators.