Podcast Ep. 19 Stanford MBA ’95 Steve Hochman meets MBA ’25 Ayesha Karnik

Today, I’m joined by Steve Hochman from the Stanford MBA Class of 1995 and Ayesha Karnik from the Class of 2025.

Steve started two companies, selling both. His first was lucy activewear, a predecessor to Lululemon, which was sold to Vanity Fair Corp. He then moved into large company roles, leading new business development for a startup incubator at Intel and later overseeing global supply chain strategy for Nike, culminating as Nike’s Global VP of Retail Supply Chain. Passionate about sustainability, Steve went on to leadership roles at Bolt Threads, creating biodegradable spider silk, and Sseko Designs, a social commerce brand supporting economic independence for young women in Uganda through circular supply chains. Today, he consults to Global 500 clients on supply chain transformation at Nagarro, Inc.

Ayesha Karnik is a second-year MBA student at Stanford. She has worked in strategy consulting at Dalberg Advisors and on growth strategy for Strive Health, a value-based kidney care company. Earlier, she served as a Health Policy Research Intern for the Council of Economic Advisors at the White House. Now, she is taking the leap to launch her own startup focused on developing an innovative blood-based cancer diagnostic test.

Together, Steve and Ayesha explore the evolution of entrepreneurship at Stanford across 30 years, the intersection of business, science, and social impact, and the different ways their generations are shaping industries—from sustainable supply chains to healthcare innovation.

CHAPTERS

00:00 Introduction and Background

04:03 Reflections on Time and Relationships

06:57 Aisha's Startup Journey

10:02 The Evolution of Startups

13:14 Stanford's Startup Ecosystem

15:55 Learning and Growth at Stanford

18:59 Steve's Career Path and Insights

21:15 From Intel to Entrepreneurship: The Journey Begins

22:43 Navigating Policy and Healthcare: Aisha's Shift

26:00 Purpose-Driven Entrepreneurship: Steve's Philosophy

30:12 Risk and Impact: The Balancing Act

32:23 The Intersection of Science and Business

37:26 Supply Chain Challenges in Innovation

43:48 Global Perspectives: Supporting Women in Business

53:16 Supply Chain Uncertainties and Agility

54:45 Manufacturing Challenges in the U.S.

01:01:40 The Role of AI in Business Strategy

01:12:53 Reflections on Learning and Future Aspirations

Join the Podcast Series
Stanford MBA: From Baby Boomer to Gen Z | Class of ‘95 Meets Class of ‘25

Each of these episodes will feature a different pair of Stanford MBA people -- one from the class of 1995, and one from the class of 2025.

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More info: https://www.katharinemclennan.com/

Contact: kath@katharinemclennan.com

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Chapters

• 0:00 Introduction and Backgrounds
• 4:03 Reflections on Time and Relationships
• 6:57 Ayesha's Startup Journey
• 10:02 The Evolution of Startups
• 13:14 Stanford's Startup Ecosystem
• 15:55 Learning and Growth at Stanford
• 18:59 Steve's Career Path and Insights
• 21:15 From Intel to Entrepreneurship: The Journey Begins
• 22:43 Navigating Policy and Healthcare: Ayesha's Shift
• 26:00 Purpose-Driven Entrepreneurship: Steve's Philosophy
• 30:12 Risk and Impact: The Balancing Act
• 32:23 The Intersection of Science and Business
• 37:26 Supply Chain Challenges in Innovation
• 43:48 Global Perspectives: Supporting Women in Business
• 53:16 Supply Chain Uncertainties and Agility
• 54:45 Manufacturing Challenges in the U.S.
• 1:01:40 The Role of AI in Business Strategy
• 1:12:53 Reflections on Learning and Future Aspirations

Transcript

Note: this transcript is generated by AI, so it won’t always be perfect, especially when it comes to: 

·        Incorrect breaks in a sentence (AI hears the pause and assumes a new sentence)

·        Exact word recognition – you may see that there are words that don’t make sense from time to time

Katharine McLennan (01:02)

Today I'm joined by Steve Hockman from the Stanford MBA class of 1995, one of my classmates, and Ayesha Karnik from the class of 2025. Steve started two companies selling both. His first was Lucy Activewear, a predecessor to Ludo Lemon, which was sold to Vanity Fair Corp. He then moved into large company roles, leading new business development for a startup incubator at Intel.

and later overseeing global supply chain for Nike, culminating as Nike's global VP of retail supply chain. Passionate about sustainability, Steve went on to leadership roles at Bolt Threads, creating biodegradable Spider Silk and Seiko Designs, a social commerce brand supporting economic independence for young women in Uganda through

the circular supply chains. Today, he consults two global 500 clients on supply chain transformation at Nagaro Incorporated. Ayesha Karnick is a second year MBA student at Stanford. She has worked in strategy consulting at Dahlberg Advisors and on growth strategy for Strive Health, a value-based kidney care company.

Earlier, she served as a health policy research intern for the Council of Economic Advisers at the White House. And now she is taking the leap to launch her own startup focused on developing an innovative blood-based cancer diagnostic test. Together, Steve and Ayesha explore the evolution of entrepreneurship at across 30 years, the intersection of business, science, and social impact, and the different ways their generations are shaping industries.

from sustainable supply chains to healthcare innovation.

Katharine McLennan (02:56)

So Ayesha, where do we find you today?

Ayesha Karnik (02:57)

So Ayesha, where do we find you today?

I'm actually in my apartment in Munger, so right on Stanford's campus. Like Catherine said, a few weeks left before we graduate, so just.

coming to terms with the end. Yeah, it's such an interesting time and I remember one of the worst questions if you don't have anything planned. What are you going to be doing in a few

Katharine McLennan (03:12)

Yeah, it's it's such an interesting time. And I remember one of the worst questions if you don't have anything planned, people could ask you is what are you going to be doing in a few months?

Steve Hochman (03:22)

Ha ha ha.

Katharine McLennan (03:24)

So Steve, where do we find you?

Ayesha Karnik (03:24)

Steve, where do we find

you?

Steve Hochman (03:27)

I am, well, if you're asking geographically, I'll answer it that way. ⁓ I'm in Hood River, Oregon,

Katharine McLennan (03:31)

Geographically.

Steve Hochman (03:36)

and it is spectacular outside. So there's a lot to be happy about. Perfect blue sky and ⁓ yeah, the birds are out. So life is good.

Ayesha Karnik (03:43)

And yeah, the birds are out, the life is good.

Katharine McLennan (03:47)

Steve is married to another Stanford Business grad. And you guys came to Stanford Business School together.

Ayesha Karnik (03:47)

Steve's, is to another Stanford Business grad. And you guys to the Stanford Business School together.

Katharine McLennan (03:58)

many years,

Ayesha Karnik (03:59)

You

Steve Hochman (04:00)

my gosh. So this is our 30th anniversary. it's physically impossible considering that we're 28, yeah. Yeah.

Katharine McLennan (04:03)

unbelievable.

Steve Hochman (04:09)

It's incredible how things accelerate. I know that's a cliche, but it is certainly true.

Katharine McLennan (04:13)

It's so weird. Time is a real bender. just to note, I'm so glad to see Steve. And one of these days, I want to see Juliette, his wife, because Juliette was one of my housemates, Ayesha. We had four other women in our house at Stanford.

Ayesha Karnik (04:13)

It's so weird. Time is a real just to note, I'm so glad to see Steve. And one of these days I want to see Juliet, his wife, because Juliet was one of my housemates, are. had four other women in our house at

was? And what about the boys? Yeah, well, so Ayesha, just a little bit of context. We've got two boys who are...

Katharine McLennan (04:31)

And what about the boys?

Steve Hochman (04:33)

Yeah, well, so Ayesha, just a little bit of context. Yeah, we got two boys who are 24 and

26, which is crazy. And they're both out in, yeah, I know, this is just not okay. But again, we're gonna stop in denial here in a few minutes. But yeah, they're happy, healthy, and policy wonks in a very unusual, interesting time. I won't bore you with all of that.

Ayesha Karnik (04:41)

Whoa, because you're 28.

Steve Hochman (04:59)

because we're here to talk about Ayesha and you and us. But yes, they're thriving in various think tanks inside of DC and living in experiencing the turbulence that we're all experiencing in the news, but maybe even one step closer. And it's a fascinating time, different time.

Ayesha Karnik (05:00)

That's

Katharine McLennan (05:18)

And Ayesha, so tell us a bit about what you're doing,

Ayesha Karnik (05:22)

what you're

So Catherine, Steve, what you saw, I was at a health tech startup right before GSB. So joined a different startup, it was probably the most fun that I've ever had in a role.

Steve, did dabble in the policy side in college because I thought I was going be a healthcare policy wonk and very quickly pivoted away. But so now I'm working on my own startup after graduation in the biotech space. So knock on wood and let's see how that goes. But the plan right now is we're going to try to get that going. Tell us a little bit about it.

Steve Hochman (05:39)

Yeah.

amazing.

Katharine McLennan (05:53)

Tell us a little bit about it.

Steve Hochman (05:55)

Is it stealth

Ayesha Karnik (05:56)

It's like kind of in stealth, but I don't think I'm gonna be saying anything revolutionary that's gonna really hurt that too much. But we're working on a new cancer diagnostic test. It's a new blood-based test. So there are a lot of really interesting companies who've been in the space already, Grail, Garden, etc. And a couple of really interesting newcomers. And so we're taking the leap to try to push into that space right now as well.

I won't say too much more, but yeah, kind of the space we're in. So who's weak? So funny enough, I think this is something only that would ever happen at Stanford. I met my co-founder last summer. So I was doing one of those summer startup immersion programs that Stanford and GSB offers. And I was working on something in the cancer oncology space.

Katharine McLennan (06:24)

So, so who's we?

Ayesha Karnik (06:44)

And I did what pretty much every other GSB or does who has no technical skills is I go to our alumni directory and I looked up everybody that I knew that was a physician or had some expertise in the cancer space. Happened to get connected with this individual who runs 110 oncologist practice out in Arizona. It's like the third biggest practice in the states. And he happened to be here over the summer for his summer executive program.

And so we ended up meeting a few times over the summer, ended up hitting it off and just vibing really well and decided to work on this together. so not a GSB-er, but a fellow Stanford grad, which is really fun. yeah. It's a connection I never would have made otherwise. And so it's one of those really cool, unique things we talk about Stanford and just the happen chance of meeting somebody.

Steve Hochman (07:21)

Hmm.

Katharine McLennan (07:26)

it's amazing.

Katharine McLennan (07:37)

Now was that always an intention over the two years you've been at Stanford to do that?

Ayesha Karnik (07:37)

Now, was that always an intention over the two years you've been at Stanford to do

that? No. mean, A, I didn't actually really want to do business school to start off with. It was never in my life plan, which I'm sure many of us had said. My older brother who went to Wharton and then my mentors in my last company were the ones who pushed me to do it.

Katharine McLennan (07:53)

you

Ayesha Karnik (07:59)

And then when I came here, was that person who was like, I would never do my own startup. That's so cliche, Stanford and GSB. Within a month, you're just surrounded by all these other healthcare junkies who are riffing on ideas and talking about things outside of, for me, kidney care, which is a very niche space I was in before. yeah, the juices just got flowing. And within month one of year one, was.

constantly doing brainstorming and whiteboarding with other people. And I did Startup Garage my winter quarter, year one, and I was all an entrepreneur from there. You know, Steve, remind us what it was like in 1995 with people that were going into the startup, because you yourself have been a startup and Nike, but a lot of startups. What was it like 30 years ago? Were we doing startups?

Katharine McLennan (08:34)

You know, Steve, remind us what it was like in 1995 with people that were going into the startup because you yourself have been a startup and Nike, but a lot of startups. What was it like 30 years ago? Were we doing startups?

Steve Hochman (08:48)

Yeah.

Yeah, was definitely, was, I mean, the difference between 95 and 98, just those three years was dramatic because it was still kind of a underground operation. were some, was, you had to be, even though we were embedded in Silicon Valley, a lot of the, a lot of folks, myself included, by the way, didn't go straight out of school into a startup. joined Intel back when Intel was on the rise, which is in the Wall Street Journal today. If you read the news is going quite the opposite direction.

Ayesha Karnik (09:03)

was we had to be, even though we were embedded in Silicon Valley, a lot of folks, myself included by the way, didn't go straight out of school and start by joining Intel. Back when Intel was on the rise, which is in the Wall Street Journal today, if you read the news, is going quite the opposite direction.

Steve Hochman (09:23)

But fortunately that was a long time ago. there were absolutely entrepreneurs who came straight out of school and started things.

Ayesha Karnik (09:23)

But fortunately that was a long time were absolutely entrepreneurs who came straight out of school and started things.

Steve Hochman (09:30)

It didn't feel quite so embedded in the culture at that point. It was more like you could, you were surrounded by them as mentors, but there was sort of one degree of separation, one extra degree of separation. That would be my general sense. So the folks who really went out and started things, I'm thinking for Kath, for example, like John Euler.

Ayesha Karnik (09:31)

feel quite embedded in the culture at that point. was more you were surrounded by them as mentors, but there was sort of one degree of separation, one extra degree of separation. That would be my general So the folks who really went out and started things, I'm thinking for example, like John Euler,

Steve Hochman (09:48)

who was a roommate of mine, they were there. they were truly sort of the bold and the daring, relatively speaking to what I've seen and observed at least from a distance around

Ayesha Karnik (09:48)

who was a roommate of mine, they were they were truly sort of the bold and the relatively speaking, to what I've seen and observed at least in the dead.

Steve Hochman (09:57)

what's going on at the GSB these days where it's truly kind of part of the bloodstream, much like the way you said it, Ayesha. So it's been a cultural evolution, think.

Ayesha Karnik (09:58)

what's going on at the GSB these days where it's truly kind of part of the bloodstream, much like the way you said it. was just checking my

WhatsApp group messages. They made a 2025 founders WhatsApp for all of us graduating. And I just wanted to check how many members are in it. We have almost 60 people who are doing this straight out of school.

Steve Hochman (10:22)

Yeah,

Ayesha Karnik (10:23)

Startup route.

Steve Hochman (10:23)

it's awesome.

Ayesha Karnik (10:24)

No, you know, we're not recruiting etc, which I hadn't even realized it was that many

Katharine McLennan (10:29)

And the sand hill type of ⁓ funding was really just on the rise. Is that right? Yeah, I think so.

Ayesha Karnik (10:29)

And the Sand Hill type of ⁓ funding was really just on the Is that right? Yeah, I think so.

Steve Hochman (10:37)

Mm-hmm. Yeah, I mean, it was certainly, it was a, I mean, uh, it was a robust ecosystem of venture capital. I don't know. Yeah. It's hard to decouple to some extent. It's a good question. Like how much of it was the sort of the

stage of maturity of the ecosystem and how much of it was Stanford and its understanding of its role in that ecosystem. I felt like it was more that it was mature and evolved, but the people who went there were like,

Like Steve Jervitsen, right? Who went straight into venture capital. There was always like one step removed from the sort of the all in entrepreneurial risk where you dive off the deep end and you raise money. It didn't seem like that was as common a path. whereas the Sandhill Road was there, like, I mean, it existed obviously not to the same extent in the same scale, there was, was a Kleiner Perkins, et cetera. They were all there. some of the big ones, Ben Rock.

They existed when we were

Katharine McLennan (11:31)

And

how much is available at the business school to learn. Now, Steve, we had a few venture capital learning type of lessons, but Ayesha, tell us a little bit. I mean, you throw out a word called garage

Ayesha Karnik (11:32)

much is available at the business school to learn. Now, Steve, we had a few venture capital learning type of lessons, but Ayesha, tell us a little bit. I mean, you throw out a word garage.

there are courses that we have. So experiential, immersive classes that you can take and you get credit for. So the ones that I think people know the most at this point are Startup Garage and Lean Launchpad. Startup Garage is typically

any sort of business model you might have, and especially more kind of services oriented, some product. People go through Startup Garage. And then you have obviously the summer opportunities. So while a lot of my friends were going out and getting formal internships, I applied to a program through Stanford, and there two different ones that GSBers will typically apply to, both the Chan and IDIS.

and they basically will pay you a stipend so that you can work from home or work from wherever and know, Palo Alto or remote and just work on your startup for you know, 12 weeks to the full summer. And so that's what I ended up doing. And I just basically had to stipend to go heads down on startup stuff. And then you just have, I mean, access to professors. mean, Catherine, Steve, you guys are talking about it. The VC ecosystem has always been rich, but I think the connection with Stanford.

Steve Hochman (12:37)

That's huge.

Ayesha Karnik (12:58)

has gotten so much richer. All of my, probably I would say my favorite classes are taught by professors who are connected or in the VC world. Scott Brady at Innovation Endeavors, Rob Siegel who was also a GSB alum. Yeah, I don't know when. I love Rob Siegel, he's probably one of if not my favorite professor. But we're taking all these classes with them and it's learning term sheets, learning.

Steve Hochman (13:12)

yeah.

He was like a class or two ahead of us, I think. Yeah.

Ayesha Karnik (13:26)

What the investors are going to try to do to you when you're negotiating term sheets and how as a founder you should be watching out for pitfalls. It's every week we have guest speakers who come in who are founders themselves, a lot of them GSB alum. And so you can see the path they took and how there's 100 different ways you can still get to being a founder. And I think that to me is actually what's been the most exciting part. I think Stanford and the GSB has broken this myth that there's one way to be a founder.

and that you have to be that aha lightning person who's sitting on their couch just like thinking of ideas constantly. And I think that to me has just been the best part about being here.

Katharine McLennan (14:04)

Steve, if you go back to Intel the CEO Andy Groves was definitely part of our Stanford, I believe. yeah, yeah. And he was a really charismatic CEO. But Steve, you stayed at Intel for that long. But what happened after that? What pulled you away from Intel?

Steve Hochman (14:12)

Yeah, he was he was why I joined.

Ayesha Karnik (14:16)

Yeah, that's amazing. He was the really charismatic CEO, but Steve, you stayed at Intel for that long. What happened after that was pulled you away from

Steve Hochman (14:20)

yeah.

well, so yeah, I did, part A was getting pulled in because of Andy co-teaching the class with Professor Bergelman, who I

Ayesha Karnik (14:27)

Well, so yes, part A was getting pulled in because of any co-teaching class with Professor Bergelman.

Steve Hochman (14:35)

don't believe is, is he still teaching there? I don't believe so. I'm just, pardon my ignorance, but anyway, amazing high-tech strategy class. And as Kat said, very charismatic and also at a really interesting juncture in the company's history when the company could, I wouldn't say do no wrong, because in fact,

there was a major defect in the chip design at the time that I was in the high tech strategy class and Andy Grove was puzzling out loud about how to address it in the public markets. And so it was fraught with turbulence, but still the company was on a very steep upward trajectory, really cool, innovative place to be at the time. that's why I joined. Part two was though, the group that I joined, which is in Oregon, which is how I ended up in Oregon was

trying to, it was a real incubator startup group. So this was my foray in a low risk way, just like, issue you talking about, it like my paid internship was inside of Intel that was trying to incubate new businesses that would create demand for processing power. Cause the big concern at the time was that we were running out of applications. Who knew, right? That that would never be a problem again, but running out of applications to create demand for processors.

Ayesha Karnik (15:16)

was real incubator startup group. So this was my foray in a low risk way, just like if you were talking about like my paid internship, it was inside of Intel that was trying to incubate new businesses that would create demand for processing power. Because the big concern at the time was that we were running out of applications. Who knew, right? That that would never be a problem again. But running out of applications to create demand for processors.

Steve Hochman (15:41)

And so we were trying to create new applications.

Ayesha Karnik (15:42)

And so we were trying to create new applications.

Steve Hochman (15:44)

so very startupy incubation type organization up in Oregon called the New Business Group. ⁓ And that is maybe the middle length answer to your question, Kath, because there was at that time a few years in that it was also the beginning of the first dot com boom. so everybody wanted to be the Amazon of everything. And it was also very easy at that moment to literally drive up and down Route 101.

Ayesha Karnik (15:45)

So very start of the incubation type organization up in Oregon called New Business Group. And that is maybe the middle length answer to your question, Kath, because it was at that time a few years in that it was also the beginning of the first dot com boom. And so everybody wanted to be the Amazon of everything. And it was very easy at that moment to literally drive up and down Route 101.

Steve Hochman (16:10)

with a PowerPoint presentation and no experience and raise money. ⁓ We did. the, ⁓ no, in this particular case, so I left Intel having incubated a few businesses at Intel and, and then I met through, this is a long winded answer, but just so you have the context, through Juliet, my wife at the time, just recent, recently married.

Ayesha Karnik (16:11)

with a PowerPoint presentation and no experience and raise money. We did. Within Intel, Steve. So didn't go always to the markets or you? No, in this particular case, I left Intel having incubated a few businesses at Intel and then I met who, this is a long-winded answer, so you have the context, through Juliet, my wife at the time, just recently married.

Katharine McLennan (16:17)

Within Intel, Steve, so you didn't go always to the markets or you?

Steve Hochman (16:40)

Who was at at Nike? I've met the women's brand director at Nike who was looking to serve an unmet need that wasn't being met by Nike and so we Co-founded because I just enjoyed starting stuff at that point and was able to raise the money on route 101 from some Silicon Valley venture investors a Women's activewear brand I knew nothing about the topic other than that way my wife was an athlete and I knew how to put together a business plan or at least I thought I did

Ayesha Karnik (16:41)

was that at Nike, met the women's brand director at Nike who was looking to serve an unmet need that wasn't being met by Nike. And so we co-founded, because I just enjoyed starting stuff at that point, and was able to raise the money on Route 101 to some Silicon Valley venture investors, a women's activewear brand. knew nothing about the topic other than my wife. And I knew how to put together a business plan. at I thought

of it.

Steve Hochman (17:09)

And so

just a convergence of luck and some amount of preparation, but a lot of luck around the timing, right? So it was, like I said, it was easy at that moment to have limited experience and still be able to raise the cash to get going. that's, we started this company, it was called Lucy Activewear. And so that's how I kind of de-risked, if you will, the journey that you're taking now, Ayesha, is by sort of taking those stair-step moves towards entrepreneurship.

Ayesha Karnik (17:36)

and you were at Washington in that policy role and that's an interesting I think so. I the initial interest started off actually back in high school. I was

Katharine McLennan (17:36)

you were at Washington in that policy role and that's an interesting shift, right?

Steve Hochman (17:42)

Hahaha.

Ayesha Karnik (17:47)

one of those kids in the debate team. And so for four years of my life, everything was policy and current events and you know, that was my world. And so I came out of that, also wanted to be pre-med when I went to college. And obviously that's not the path that I stuck to. And so I always kind of had those two threads at the back of my head of I love medicine, I love that space. And I really liked the kind of the policy side of it.

And so when I was in college, there was kind of a program that we were able to do where we could intern in DC while taking classes with some of our professors from the University of Texas kind of system out in DC. And so there was like this hybrid internship classes semester that I had. And so while we were there, the whole point is to do an internship that was actually at a policy division or organization. And so that's where I did my health policy.

internship at the Council of Economic Advisors. And I think there's so much value for what people do and are working on on the policy side of things. I think the pace is just not for me. There is a lot of red tape, so many steps that have to happen, and you could be in a room where everybody agrees on what needs to move forward, but it won't be four months until that move forward actually happens.

for a variety of reasons. And so I think for me, I just know myself, probably one of my worst traits is I'm a very impatient person and I like to see results pretty quickly. And so pivoted away from the policy side and then thought that maybe the pivot was let's go work in consulting but on the social impact side of things, which is why I went to Dalberg and I was okay, it's kind of the hybrid of public private sector now in this role. Again, loved it.

a little bit slower pace again for what I think I needed. And just a different, I think just level of resourcing in some of those organizations, they're doing amazing work, but it's just, there's always gonna be a little bit of a limit on, and I think the sheer impact. And so really thought, okay, private sector, if I work in something impactful, I think we can make a lot of kind of growth and reach. And so ended up joining a startup, which is really nimble, really agile, really working on something that was.

kind of personal to me. And that's when I got sucked into, you can still have impact through the private sector world. It's just a different route, but there's a lot of resources that are backing you. And Steve, if you go but I know you were always looking for companies that had social impacts. well, tell us a little bit about that philosophy as you were looking for opportunities.

Katharine McLennan (20:13)

And Steve, you go back I know you were always looking for companies that had social impact. tell us a little bit about that philosophy as you were looking for opportunities.

Steve Hochman (20:24)

some combination of DNA and experience, I guess, that kind of kept pushing me back to purpose ⁓ as a thing and making and calling it out explicitly rather than implicitly. It just was part of how I showed up to work in the very beginning before I joined business. Before I came to business school, I worked ⁓ at Bain & Company, which didn't necessarily check that box.

Ayesha Karnik (20:25)

I that kind of kept pushing back the purpose as a thing and calling it out explicitly rather than implicitly. just was part of how I showed up to work in the very beginning. Before I joined, before I came to business school, I worked at Bain & Company, which didn't necessarily, I checked that

out. But between the two, between Bain and Stanford, I worked for.

Steve Hochman (20:45)

But between the two, between Bain and Stanford, I worked for an environmental

policy and environmental advisory firm well before the word sustainability was even in the vocabulary of a lot of organizations. And ⁓ I think the DNA part is just, I'm a nature boy. I mean, I, it's just, I was that kid

Ayesha Karnik (20:53)

well before the word sustainability was even in the vocabulary of lot of organizations. And I think the DNA part is just I'm an introvert. I was that kid.

Steve Hochman (21:06)

So that, if you take that as kind of the sort of the baseline, I found myself, again, we all ask the question, right? Like what's my source of energy? And so for me, that

Ayesha Karnik (21:06)

Yes. that's you take that as kind of the baseline. Just I found myself again. We all ask the question, right? Like what's my source of energy? Yeah. So for me, it has.

Steve Hochman (21:15)

was a key part of it. And so, yeah, I carried it forward without necessarily thinking it had to be the environmentalism thing. It was just the notion of, you know, the Steve Jobs, the cliche of, you know, leave a ding in the universe.

that has always motivated me. And so that was in the form of creating opportunities for women in sport because of the background that Kath just described for Juliet and my respect for that. But it was also, it still was a thread of sustainability. so long story short on that front is I did stay, I found a niche from an industry perspective that I could hang my hat on in apparel footwear and functionally speaking in operations.

The cool thing about the operations piece is that it affords you an opportunity to move the needle on sustainability. Cause if you can reduce waste in the supply chain, then you can do all sorts of amazing things for the planet. Um, and, um, you know, another part of being a serial entrepreneur is that you, you, you it's a portfolio play because sometimes you have the aspiration and the vision and you're ahead of the curve too far ahead. And I had some of those, um, and then others where, you know, even at Nike,

I was able to find enough critical mass and support for the things that I wanted to do in addition to the day job of actually delivering profit and loss for the company, mostly profit. There was really an opportunity to innovate both in large companies and in some small startups after Nike. So ⁓ yeah, think it probably to maybe to reflect on the answer in real time, Kath, I think part A of the answer is, you know, I just kept looking for opportunities to

Ayesha Karnik (22:29)

the company, most of the profit. There was really an opportunity to innovate both in large companies and in small startups after that. So yeah, I think it probably, maybe to reflect on the answer in real time, Cap, I think part A of the answer is, you know, I just kept looking for opportunities to

Steve Hochman (22:49)

⁓ Fit it into you

Ayesha Karnik (22:49)

fit it into.

Steve Hochman (22:51)

know another role that I knew would have enough stability so that I could stick with that purpose Knowing that there was some critical mass of financial stability behind it ⁓ And whether that was venture capital or you know a large company the other I was gonna say like I think the other thing is though ⁓ with that comes some risk just to be clear like there's I have

Ayesha Karnik (22:51)

another role that I knew would have enough stability so that I could stick with that purpose knowing that there was some critical mass of financial stability behind it. And whether that was venture capital or a large company. And you've got to have a company. keep going, Steve. Oh, I was just going to say, I think the other thing is though, with that comes some risk, just to be clear.

Katharine McLennan (23:04)

and you gotta have a company. Yeah, keep going, Steve.

Steve Hochman (23:16)

It's enough part of who I am that sometimes I'll take risks that won't necessarily be wise if you just look at them through the lens of finances, because it's just too important to me to have that kind of impact. anyway, that means that my career has been, you know, it's been great, but I've also had huge ups and downs along the way. It's not a straight line by any stretch.

Katharine McLennan (23:38)

if you say risk and impact, what do you mean by that, Steve?

Steve Hochman (23:40)

Yeah.

So, you know, if take is a given sustainability, right, I'll give you an example, right? Like I, so Nike, I had 10 year run, amazing company, loved it. And it is itself very, it's very supportive of entrepreneurs. is a just do it, you know, that actually means something. It is that kind of culture and company. And so I could have stayed there forever, right? And that would have been the low risk move. And things were going great.

and sort of up and to the right, right? And, but my impatience around moving the needle on sustainability meant that I didn't stay. So I was recruited into an organization after 10 years that was well-funded from a venture capital perspective, focusing on sustainable materials ⁓ in the apparel business. And it was doing, the company was developing out of Silicon Valley.

Ayesha Karnik (24:14)

but my impatience around...

needle on sustainability meant that I didn't stay. So I was recruited into an organization after 10 years that was well funded from a venture capital perspective focusing on sustainable materials in the apparel business. And company was developing out of Silicon Valley

Steve Hochman (24:37)

biomaterial. it was, genetically engineered spider silk without spiders to make apparel really cool stuff. And the company still exists, but barely. Right.

Ayesha Karnik (24:37)

biomaterials, genetically engineered spider silk without spiders to make apparel. Really cool stuff. And the company still exists, but barely.

Steve Hochman (24:47)

So I was the COO and we thought we were going to scale the scientific breakthrough. It happened. And it truly is revolutionary, but the difference between scientific breakthrough and a scalable process is fast. Right. It's that lesson that continues to need to be relearned. So when I say risk.

Ayesha Karnik (24:48)

I was the COO and we thought we were going to scale the scientific breakthrough that happened and it truly is revolutionary.

Steve Hochman (25:06)

It was that, right? Like I had a salary, right? But you know, I was there for a little shy of two years and we just realized it wasn't going to scale. And it wasn't a science, it wasn't a supply chain problem, which was my expertise. It was a science problem. Yeah.

Ayesha Karnik (25:21)

Okay, that's a great opening for you.

Katharine McLennan (25:21)

Ayesha, that's a great opening for you because

you're all science, And so what is the role of startup business and science discovery for you?

Ayesha Karnik (25:33)

Pure business, pure strategy. The company was more of a care model services company. So we were deploying nurses, practitioners into models. For anybody who is familiar with kind of the Oak Street One medical model, that is what we were, but for kidney care. Just by nature of GSB and meeting different people and different conversations, I just got interested in this biotech space and slightly more of the science forward side of things.

And so this, to your point, Kath, is a very, very different path. And I think exactly it's what Steve is saying. When I sit here thinking about the next six to nine months, I don't think the thing in the back of my head is, my gosh, this may not happen because I don't want it to happen. It's the science may not connect in the way we need it to connect in order for it to happen. Or even if the science does connect in the way there are 12.

steps after that to actually get it commercialized and in market. And anybody who knows healthcare knows that regulation is really hard to get through. And so I think to me the startup plus the science side, at least in the healthcare space and biotech is really fascinating because so much of the innovation happens there, but there's almost a behemoth of work and kind of barriers you have to get through after just the initial science that

Steve Hochman (26:35)

you

Ayesha Karnik (26:52)

In some ways, the breakthroughs aren't enough to actually make a company, always. And so I think that's the tension that we're thinking through right now of what are all the things that we could be doing today to start de-risking all of those processes we're gonna have to go through in six months, should we get the signals that we wanna be getting.

Katharine McLennan (27:11)

But have you discovered then something that already exists in the science is it something that you saw and you said this has a goer and people aren't in the market and so therefore I'm going to support the science, but here's the path.

Steve Hochman (27:11)

huge

Ayesha Karnik (27:18)

and you said this has a goer and people are in the market, and so therefore I'm gonna support the science, but here's

I would say I think it's a bit of a mix. there's been, I mean, there have been players in this space for decades, if not more. don't think, you know, early diagnosis of cancer is necessarily a new space, or we're creating a new market. I think the approach to it,

has been slightly different than what we are gonna be looking at doing hopefully in the next six to nine months. I guess without going into too many details, I think there are signs out there that at least gives us confidence that this should work. And we've seen it in the research that this works. I think the actual application of that particular type of research in this field in particular.

Steve Hochman (27:50)

Yeah.

Ayesha Karnik (28:07)

hasn't actually connected yet. there's a little bit of newer science that we're trying to bring into the space that hasn't fully been here before.

Katharine McLennan (28:13)

And so here you are bringing together the business, the regulatory scene, the science and you're trying, and by the way, competition, and you're trying to put all those pieces together. I don't think many minds could handle that.

Ayesha Karnik (28:22)

and you're trying to put all those pieces together. I don't think many minds could handle that.

think it's so funny because we were just talking about Rob Siegel before. mean he teaches a class on called systems leadership and it's literally all about this. He has a book that he's released all about it and I think it's so core to what we've been learning in all of our classes of if you are working in silo as the business person or

the biology person, you're never gonna be able to do what needs to be done for the strategy. And so I think about all of our project management boards that we have, and I probably have 13 different columns because one's regulation FDA, one is reimbursement payer, and what does our actual payment mechanism look like? One is how do we get providers to wanna use this? One is how do we market a patient? There are just so many complex actors.

And I think if you're not thinking about as a system, especially in healthcare, Steve, mean, especially in sustainability, there's just, I don't think there's really a path to success there. And that's competitive edge, Ayesha. I was a little bit in biotech in my summer between, I worked for Amgen before- Oh, amazing.

Katharine McLennan (29:24)

And that's the competitive edge, Ayesha. I was a little bit in biotech in my summer between, I worked for Amgen before Amgen was famous.

Steve Hochman (29:27)

you

Katharine McLennan (29:34)

But back to Steve, your supply chain expertise, how did you take that on in the next step?

Ayesha Karnik (29:34)

But back to supply chain then how did you take that on in the next step? mean, the gap there is interesting because we're talking a lot about systems.

Steve Hochman (29:42)

the gap there was, it's interesting, right? Cause we're talking a lot about systems and fusion,

right? So was a combination of supply chain and science. Like you couldn't decouple them. It was like the, to not to get too wonky on you, but like this is very relevant. So I think what I, is talking about, right? There's like, there's science and then there's science. Like it applies at different stages in that journey, that 13 steps that you're describing. So like the first is.

laboratory, right? I had nothing to do with that and I could, you know, could wear a lab coat and that would be the end of it. But there's like another stage where science is still involved where you're trying to figure out how do you make a process, in this case spinning silk reliably, that's still very much science-based convert to something that is a production facility, supply chain, right? That can then generate millions of units of this stuff. So anyway, that's

That was the breakdown. That's what didn't work is the handoff between the two. And so that's backwards looking. What I did after that was just double down on the knowledge that I had and the network that I had to identify what next. this is more of the classic serial entrepreneur strategy where it was clear that wasn't going to happen. We had money, but it was going to take an extra five years.

Ayesha Karnik (30:49)

So this is more of the classic serial entrepreneur strategy where it was clear that wasn't going to happen. We had money, but it was going to take an extra five years

Steve Hochman (30:59)

that the company wasn't going to spend on a COO, which was my role. ⁓ And so I ended up joining and leading

Ayesha Karnik (30:59)

that the company wasn't going to spend on a COO, which was my role. And so I ended up joining and

Steve Hochman (31:06)

organization that was trying to figure out small retail ⁓ purpose led apparel company that was trying to figure out how to create a opportunity again for women in the manufacturing locations where the product is sold. So both in Africa and in Asia. ⁓

with me coming on board how to close the loop on waste in a traditional apparel retail supply chain. So thinking about circular supply chain. So I actually ran that company for a couple of years before we sold it. So that's where I went next. It was not in this case, I stepped away from the science, right? This became much more of an engineering problem in this company. ⁓ yeah, so the thread was still there, so to speak, in terms of purpose, but kind of classic case of demonstrate agility because you have to.

And when one venture doesn't work, you reinvent and still, of course, leverage the knowledge that I had. So that was sort of the next step.

Ayesha Karnik (32:04)

That was sort of next step.

Katharine McLennan (32:06)

truly amazing, Ayesha. how many people at Stanford now are involved in the healthcare segment? Because Steve, I don't think many of us were,

Ayesha Karnik (32:06)

truly amazing, Ayesha. many people at Stanford now are involved in the healthcare segment? I don't think many of us were.

Steve Hochman (32:17)

No.

Ayesha Karnik (32:17)

getting into either the policy or the research. I mean, it was fascinating for me to go and work at Amgen, but even Genentech at that time, were still the outliers in terms of startup. Biotech was just starting, Ayesha. So healthcare now in your class, in your interests, we're all watching it in terms

Katharine McLennan (32:18)

getting into either the policy or the research. I mean, it was fascinating for me to go and work at Amgen, but even at that time were still the outliers in terms of startup. Biotech was just starting, Ayesha. So healthcare now in your class, in your interest, we're all watching it in terms of

Steve Hochman (32:26)

Yeah.

Yeah, two plane years.

Katharine McLennan (32:45)

especially

the US model, how many people, how does that get looked at at Stanford?

Ayesha Karnik (32:45)

especially the US model, how many people, how does that looked at?

Well, what I find interesting is I would still say within the GSB, it still feels like a pretty small number relative to the size of the industry. So I was literally just going back to our WhatsApp again to refer to it. I think in our class, there's maybe 40, 50 people who are very focused on healthcare, which is definitely, it's a big chunk of it.

But I think that doesn't necessarily translate to the GSB ecosystem around us. So when I think about the number of classes that are offered that are more focused on healthcare, very few. And so for a lot of us, actually take, I'm sure you guys use the same term, the across the street classes to go to the med school or primarily the med school to take any sort of healthcare specific classes.

Healthcare innovation, there were biotech classes we took. There's AI innovation in healthcare and a lot of those courses are offered not in the GSB. And I think in the past couple years has been a much bigger movement of creating cross school collaborations. So there's now a Stanford Healthcare Innovation Club that is across schools. So engineering school, med school, GSB that's trying to bring together healthcare folks.

Cuz I think if you look at it in each individual school, the offering may not be nearly as large apart from the med school of course. And so I think that's something that a lot of the healthcare folks in our class have been struggling with and or trying to remedy a little bit is how do we build a community around healthcare when there may not be as much of that healthcare focus in the GSB curriculum or course offering or whatever that is.

Katharine McLennan (34:32)

But 40 to 50 people, that's a lot, Steve.

Steve Hochman (34:34)

Yeah, a lot.

Yes, comparatively. think, know, Catherine, to your point, was maybe 10 % of that.

Katharine McLennan (34:41)

Steve, when you're talking about the supply chain and getting women up in the various countries,

Ayesha Karnik (34:46)

getting women up in the various countries.

Katharine McLennan (34:51)

How do you decide at the time you go in, Steve, where countries, which countries, how do you find the information? Because you guys are just inundated with information, Ayesha, in this generation.

Ayesha Karnik (34:51)

How do you decide at the time you go and see where countries, which countries, how do you find the information? Because you guys are just emendated with information, Ayesha, in this generation.

Katharine McLennan (35:03)

What was it like then, Steve?

in the company that you just introduced, where you decide to really support women and you find the countries overseas, how do you do that?

Steve Hochman (35:07)

yes, several years ago. Yeah.

How

do you do it? Yeah. Well, triangulation is kind of the fancy term, right? You're looking at all these factors that you consider. And one of those, because we were driven by that particular mission was a filter, right? So you think about it, like one filter was just where are there so-called fair trade certified manufacturers? And that starts to shrink the list pretty quickly. And there are some associations even that manage, there are like syndicates that manage some of that information and those networks. So there's that.

But then there's also capability and skill set and that is harder to discern through just like a website. And there you're just, it's again personal networks. I keep coming back to that, but it's so much of it is who do you know that knows someone that can allow you using six degrees of separation to find that right partner. And then the third part is still honestly, and this is part of the entrepreneurship thing, it's supplies and supply chain as well as in technology is just trial and error and experimentation.

Ayesha Karnik (36:07)

as well as in technology is just trial and error.

and experimentation.

Steve Hochman (36:12)

And so trying to create that laboratory environment where you've got like a few suppliers competing for the business and one of them is going to work and one's not. So you sometimes just have to learn by doing.

Ayesha Karnik (36:12)

And so trying to create that laboratory environment where you've got like a few suppliers competing for the business and one of them is going to work and one's not. So you sometimes just have to learn by doing it? Is it women led companies or? That was the network. That was very much as to the origin story of the company that predated me. came in to run it after it had been established. There was a woman who had that as her soul.

Katharine McLennan (36:22)

Is it women-led companies or?

Steve Hochman (36:22)

Yeah.

That was the network. was very much. So the origin story of the company that predated me, I came in to run it after it had been established. There was a woman who had that as her sole life

mission beyond business. And ⁓ she started a factory to try to create opportunity for women, ⁓ young women in particular in Uganda. Long story as to how she ended up there. Again, some personal connections. So that was truly a one-on-one connection.

done at the true grassroots level where she basically parachuted herself in and said, speaking of risk, I'm just gonna start this. And so was literally like making sandals and teaching girls how to make sandals in this one village outside of Kampala, the capital of Uganda. And then it was networking from there that led to partners that were like-minded in Uganda, but also in India in particular, and even...

though we don't associate China with that kind of like social purpose oriented ⁓ attitude towards industry, there are some real social entrepreneurs in places you wouldn't expect to see. So we had some in China as well.

Katharine McLennan (37:33)

And I also worked for a company Cochlear, which you guys call Cochlear. And so the, the regulatory that you're talking about that happens all over the world.

Do you research at this point?

Ayesha Karnik (37:49)

Yeah, it's something that we've been ⁓ taking a look at. I've talked to a few other folks who've done their own share of biotech startups in the past and in their experience. And I've actually had conversations with them of, did you ever consider

trying out your technology in a different country where regulation may not be as interconnected, complex, etc. as the FDA. But you would still get a stamp of approval that the technology works, it's vetted, you can definitely deploy it out into market with different populations. So I will still I think right now we're still focusing on the US. I think both me and my co founder, who's a physician, like we're very familiar with the FDA is probably the closest

regulatory system that we're used to. But we have been actively researching, there other environments or health systems that might be, for many reasons, advantageous to go look at as a primary market, if we think the science to actual market steps are too robust here.

Steve Hochman (38:57)

Yes.

Katharine McLennan (39:00)

In this crazy environment that the US is creating, what are you seeing in terms of

Ayesha Karnik (39:01)

In this crazy environment that the US is creating, what are you seeing in terms

Steve Hochman (39:06)

Yes. ⁓

Katharine McLennan (39:08)

the supply

Ayesha Karnik (39:08)

of the supply

Katharine McLennan (39:08)

chain impacts,

Ayesha Karnik (39:09)

chain here? Well, of you don't know what's going to

Steve Hochman (39:10)

Well, of course we don't know what's going to happen.

That's that much we know. But the gist of it is that the world of uncertainty is the answer. Like how you handle uncertainty is how you're going to manage supply chain. So it's all about scenarios. It's all about options. Portfolio theory applied to finance, but applied to supply chain, right? You just have to be ready to pivot. of course, unlike

dollars flowing through with electrons across the digital infrastructure, you have physical things you gotta build, right? And you have capabilities and skills, so it's not as simple. And therefore, the risks and the costs of failure are higher than you would have in say just bits and bytes. And so yeah, it's incredibly difficult. I mean, we don't know, but what we do know is that...

those who will win are gonna be those who are able to pivot better while still having a stable capability at the core, right? So it's that ambidexterity, if you will, that is gonna be the sort of the muscle that is defined, think, defines the next five years. Whereas before, historically it was about efficiency, reliability. COVID was kind of our first test for agility, right? Kind of a global level. And now we're in a...

It's a kind of a COVID 2.0 sort of experience, but self-inflicted in this case.

Katharine McLennan (40:27)

is there

Ayesha Karnik (40:27)

is there

Katharine McLennan (40:28)

any possibility in your industry, in your specialization to even do that? Like, is the US ever going to be able to manufacture?

Ayesha Karnik (40:28)

any possibility in your industry, in your specialization to even do that? Like, is the U.S. ever going to be able to manufacture? How much time do you have left? ⁓

Steve Hochman (40:38)

⁓ How much time you guys got? No.

So there will be a movement there. There has been moving prior to this current administration towards US manufacturing certain areas because of other benefits like closer to market for the US market or like today Ayesha's description of like if you're talking about pharmaceuticals.

sometimes having a relationship with the regulators, et cetera, as you know better than I, those things merit having a supply chain close to market. There's many reasons. So that's the good news. But no, mean, honestly, I don't know if I can, I guess I'll say, I can say this word on podcast. The Chinese are kicking our ass when it comes to ⁓ manufacturing, broadly speaking, and that's not just a parallel footwear. It's like, actually advise companies across sectors in supply chain.

Ayesha Karnik (41:20)

Chinese are kicking our ass when it comes to manufacturing, broadly speaking. And that's not just a parallel footwear. I actually advise companies and cross-sectors to use the white chain.

Steve Hochman (41:31)

in my current incarnation and whether you're talking pharma, whether you're talking heavy industry, automotive, Chinese are running circles around us. So Tom Friedman, yes, like that's kind of, I see the same thing. And number one, number two, the skillsets required, the education system. So this is why I'm trying to keep it short. I could go on about...

the gaps that we have in educating our workers to be able to capitalize on the new ways of manufacturing. It's not screwing screws into iPhones manually, it's robotics, right? ⁓ And it's managing digital systems that manage robots and so et cetera, cetera. So we have major work cut out for us. And then finally, the economics, even when you do all of that, may still compete against us for the labor content that remains for certain areas where you can't automate.

Katharine McLennan (42:03)

Hey.

Steve Hochman (42:20)

So China labor rates are more expensive than Southeast Asia, but there's still one fourth of what they are in the US, right? So all of those factors are huge hills to climb and tariffs are not, I'm trying to be apolitical here, but they're not gonna get us there.

Ayesha Karnik (42:28)

So all of those factors are chills to climb and tariffs are not trying to be apolitical here, but they're not gonna get us

when we say-

Katharine McLennan (42:36)

when we say very naively that China is a copycat, no, it's not. It's not a copycat.

Ayesha Karnik (42:37)

very naively that China is a copycat. No, it's not. It's not a copycat.

Steve Hochman (42:42)

No, exactly.

That's intense hubris. Yes.

Ayesha Karnik (42:45)

It's intense hubris. It's intense hubris. And so we're Sputnik when back in the 60s when we're like, oh my God, we better get our aeronautical engineering quickly or Russia involved. Okay, so Ayesha, back to Stanford

Katharine McLennan (42:46)

It's intense hubris. And so we're back to, Sputnik when back in the 60s when we're like, my God, we better get our aeronautical engineering quickly. the Russia involved. OK, so so Ayesha back to Stanford then.

Steve Hochman (42:56)

Yes. Yes.

Katharine McLennan (43:02)

How much exposure are you getting to that international, view?

Ayesha Karnik (43:04)

I

I think in

a variety of channels, not just so A, we have some courses, Keith Hennessy, for example, has so many classes like policy time, US, China, where we do have very dedicated courses of talking about issues like this. Funny enough, the travel in some ways actually does lend itself to that. So we had a group of students in our class who are from Saudi Arabia and they planned a trek.

So we did a truck to Saudi Arabia over winter break. We have some of our Chinese classmates who set up two different trucks to China and Tibet over spring break. And so there's, I think, options and opportunities in that way to be able to go see and experience a lot of these different cultures firsthand that I don't think we always necessarily would have gotten the chance to otherwise. And then I think it's just...

You guys know this Stanford GSB students are curious. We always have opinions, sometimes too strong of opinions, but we have them. And I think just constant just talking with classmates. Every time there's a new news article that comes out, you know the buzz is around campus and everyone's talking about it. And we try to also whenever we bring in speakers in a polite way, but we'll try to ask them about some of these geopolitical issues and.

how it's affecting the companies they're running or the way they're thinking about their long-term strategies. So I think there's a lot of different vantage points through which we're able to plug into what's happening in the global ecosystem, which is keeping us kind of up to tabs on that.

you, are you a regular

Katharine McLennan (44:40)

Steve, are you a regular traveler

Steve Hochman (44:42)

Yeah. So I've spent a fair amount of time in Asia, partly, I mean, even back to Nike days, it was very much part of the job description to spend a much time with our factories and, and then sort of informally through the client network that I now have. So yes, a lot. And Europe, Asia, yeah, across most places. I haven't spent much time in Africa and South America.

But I mean, that's not because we shouldn't. It's more just that it's the next thing on the map to some extent from my perspective that we're now discovering needs similar cultural understanding that we didn't have when Asia was the new kid on the block.

Katharine McLennan (45:16)

which makes a lot of sense. Here's a question, Ayesha. If you had to pick a country instead of the US where you are going to do your business or start your business, would there be a second choice somewhere that would be easier?

Ayesha Karnik (45:17)

which makes a lot of sense. Here's a question, Ayesha. If you had to pick a country instead of the US where you are going to do your business or start your would there be a second choice somewhere that would be

Yeah, I think what makes it a little bit hard to even answer that is even in the US, FDA healthcare regulation over the past, let's just say,

months has changed so much and it's constantly changing that my co-founder and I going back and forth every time there's a new regulatory announcement of wait is this good for us or is this potentially gonna make it harder? And so there's almost uncertainty whether or not in some ways the US might actually be coming now easier for us to to handle some of the regulatory side but assuming it's as difficult as the FDA tends to be I mean place that we've looked at

Steve Hochman (45:53)

You

Ayesha Karnik (46:09)

Honestly, our, you Canada, UK, where they're very similar in terms of pharmaceutical, medical research, science, cultures, but with their national healthcare system, I think enables some optionality for wider kind of distribution than what you would get in the US. Here, it's very much dependent on individual payers that you have contracts with, maybe Medicare, but largely payers.

in those countries, there is a national system, there's one payer, there's one buyer, there's one distributor. And so those are kind of options that we've been considering, but I think in the next few months, it's still to be determined depending on what happens with the FDA. What could change mostly in the last six months for the FDA? There are just certain approval processes, specifically for medical devices and new technologies through the drug approval and medical device approval.

Katharine McLennan (46:50)

So what has changed mostly in the last six months with the FDA?

Ayesha Karnik (47:04)

pathways that there has been discussion on whether or not easing up certain parts of those pathways and tightening up other parts of those pathways. Some fun balancing acts that are happening right now. But there are a couple of those specific approval processes and applications that might be applicable to what we're doing that might be falling in the bucket of

they're trying to find ways to accelerate approval for. And so there might be a tailwind for us potentially to be catching right now. But we're still in that mode of discussion, proposals, waiting for approval of some of these kind of regulatory shifts to happen that we're a little bit sitting on the edge of our seat here.

Katharine McLennan (47:47)

Steve, you're now consulting with a lot of supply chain businesses, is that right?

Steve Hochman (47:54)

manufacturing is, know, Nike is a client, Honeywell, General Motors, all those guys.

Katharine McLennan (48:00)

What do they come and ask you to do? What's their biggest challenge?

Steve Hochman (48:04)

Well, like the question you asked around sourcing and source location and how do we, how, how do we create, I'll, I'll use the word agility to simplify, you know, how, how do we adapt to what we're seeing and what is the future hold? So it's both backward looking and forward looking in there. And so we're advising based on trends that we see, we, know, we're constantly immersed in the data to see what people are doing, not only in terms of investment in locations, but also in skills and in technology.

Ayesha Karnik (48:11)

I'll use the word agility to simplify. How do we adapt to what we're seeing? And what does the future hold? So it's both backward looking and forward looking. And so we're advising based on trends that we see, we're constantly immersing the data, see what people are doing, not only in terms of investment in locations, but also in skills and in technology

Steve Hochman (48:33)

to enable that kind of

Ayesha Karnik (48:33)

to enable that kind of.

Steve Hochman (48:35)

ambidexterity.

Ayesha Karnik (48:37)

Ayesha, if you think 1995 when we graduated, the internet was just coming alive. And when we did enter, in my argument, the information age and we were challenged.

Katharine McLennan (48:37)

think about it, 1995 when we graduated, the internet was just coming alive. And when we did enter in my argument, the information age and we were challenged. Yeah, like that. were, when humans were just walking there and...

Steve Hochman (48:40)

Yes.

and the dinosaurs were walking

the earth. Yeah, yeah, yeah.

Katharine McLennan (48:54)

the big challenge for the information age was big data. if we're entering this new age, how does AI then play a role in the search of where businesses can go and the data you need to decide that? Does AI help you with that?

Ayesha Karnik (48:54)

The big challenge for the information age was big data. if we're entering this new but how does AI then play a role in the search of where businesses can go and the data you need to decide that? Does AI help you

with that?

I think AI has been honestly huge for it. mean, if I consider myself in the way that we've been approaching some of the pieces of startup, I mean, a few things. One, if we think about, you know, the 13 columns that I'm trying to ramp up on and make sure I understand, especially in healthcare, not everything is available easily for you to get information of. And somehow chat BT perplexity, they've become my best friends of understanding.

Steve Hochman (49:11)

usually.

Ayesha Karnik (49:39)

how do these regulatory processes work? What are the individual steps I need to be looking into? How can I, Steve, to your point, start scenario playing with a few of these different announcements that we keep getting? So in terms of just knowledge ramp up and acceleration, it is massive for kind of the given startup you're working on or the field you're in. And then I think it's also just big for exploring what other opportunities or options are out there. So.

For us, we've been thinking about what is the best way to take our technology to market. And there are some pretty standard ways you could think about business models for biotech. And I, a week ago, just did a simple question to chat to BT of saying, hey, can we just think about our company, not as a biotech company, but as a SaaS licensing company? Can you help brainstorm with me? What are ways to think about applying other business models to what we are doing?

Steve Hochman (50:26)

Great.

Love that.

Ayesha Karnik (50:31)

And I had like a full 45 minute conversation, whatever you want to call it, with Chad GPT. And I'm literally about to have a conversation with my co-founder later this week about how can we start thinking about blending some of these models that previously we thought were in two different universes. And I don't think, at least for me, where I'm sitting when you're so heads down working on a startup, it helps bring you back a little bit to the big picture.

and pulling in insights and threads from other industries and other models that I think has been, at least for me personally, just transformative

think? I think there's a double-edged sword that a lot of our classmates have been talking about.

this era that we're in right now as we're using AI for our learning capacity at the GSB. As you can imagine just the many places chat to PT is showing up through classes. But I think the double edge sort of that we've thought about is for kids who didn't kind of have the foundation of learning like we did. Does things like chat to PT almost create a crutch that they don't know how to learn? The reason why I know to ask about

applying SAS models to the business models we're in is because I grew up in an age where for every research paper, we had to have a bibliography with 18 sources from physical textbooks or actual articles or publications online. And so if Chatchity GPT gives me an answer that I'm not satisfied with, I have this back of my mind intuition to question that and to ask for refinement and to ask for.

Okay, that's helpful, but give me this other angle because I have tidbits of information that I've just stored at the back of my mind. And so something that we've been thinking about is I think chat GPT opens up so much for the potential for kids learning. And if you're able to feed to the right questions, I think the universe is just infinite. But it is how do you still instill a level of the right way to learn the right way to prompt chat GPT with the right questions? Because chat should be

Chat GPT can give you any answer out there. It's whether or not it's giving you the answers that are actually gonna push your thinking and push whatever innovation that you're working with.

Katharine McLennan (52:38)

Steve, all right, so we are all nearing 60. Some of us are a little over 60. If we had to give advice on anything, I mean, we can't give you advice on check CPT or, you know, the regulatory and how healthcare is gonna change,

Steve Hochman (52:50)

You

Katharine McLennan (52:53)

If we imagine ourselves,

Ayesha Karnik (52:53)

If we imagine ourselves,

Katharine McLennan (52:55)

Steve when we're just about to graduate, if there was one thing, I

Ayesha Karnik (52:55)

Steve, just about to graduate, if there was one

Katharine McLennan (53:00)

I would have liked to know if anybody could have told me

Ayesha Karnik (53:03)

all ears.

Steve Hochman (53:04)

Yeah, exactly.

Maybe that would have been the thing. Listen.

Katharine McLennan (53:07)

Yeah, yeah,

exactly,

Ayesha Karnik (53:10)

joking aside, I think it's...

Steve Hochman (53:09)

joking aside, I think it's for the first part of our lives at that point, like for it was our entire lives. We were rewarded for being the smartest kid in the room or, seeking a claim for that intelligence and

It's ironic, but the conversation around chat, GBT around, and you said it, Catherine, like asking the right question. I wish I had spent more time thinking about how to ask the right question versus coming up with the answer. and it's, and that's still a learning for me. Like I still am still working on that, but I, if I could go back in time, I would have made that an explicit expectation of myself.

Ayesha Karnik (53:25)

I ⁓ wish I had spent more time thinking about how to ask the right question versus coming up with the That's And that's still a learning for me. I'm still working on that. But if I could go back in time, it would have made that an explicit expectation of myself.

Katharine McLennan (53:50)

I love that. And there's so many forms of wisdom that I just didn't appreciate, Steve, when I graduated.

Ayesha Karnik (53:58)

So Ayesha, as we come to a

Katharine McLennan (53:58)

So I should, as we come to a close.

Ayesha Karnik (54:00)

close, you. I'm so excited and delighted that the minds like yours are coming into that. What else are you most excited about as you come to a close at Stanford?

Katharine McLennan (54:02)

I'm so excited and delighted that the minds like yours are coming into that. What else are you most excited about as you come to a close at Stanford?

Ayesha Karnik (54:13)

Probably the cliche answer, but I'm honestly just so excited for the next seven weeks to spend time with friends here on campus in Palo Alto. You guys experienced it the first year and a half went by so quickly. And a lot of ways I call the GSB really a one year program because the first year you're trying to figure out what the heck is going on. And even though you think you knew what was going on, by second year you look back and you're like, wow, I should really had no idea what was happening.

So I think the next seven weeks or six weeks that we have left, all of my friends have talked about, we just wanna slow down and just enjoy it and actually be here. To your point, Kath, we are doing all the travels, we're always gone, we're running at 100 miles per hour, but I think we're just missing a lot with that and so I'm excited just to be with it. I used to bet it's the generations challenge. I'm excited for you. Thank you.

Katharine McLennan (55:04)

Ayesha, that is the generations challenge. And I'm so excited for you