our show is on hiatus this week so we'd like to present with you some of our favorite programs. tonight we'll hear from the young minds who have created some of the world's most innovative tech companies. here are a few highlights from my conversation with max lebchen, co-founder of pay pal. founder of tm blrx ler, mark an creasean and mark zuckerberg. >> i think the next five years now you are connected to all these people, now can you have a better music listening, movie watching experience, see what your friends are reading and learn what news you should read first. all of these things i think are going to get better. and that's the thing i'm most excited about for the next five years. and if we do well i think five years from now people will really look back and say wow, over the last five years all these products have now gotten better because i'm not doing the stuff alone, i'm doing it with my friends. >> rose: some of the most innovative people from silicon valley next. >> funding for charlie rose was provided by the following:.

>> additional funding provided by these funder it's captioning sponsored by rose communications from our studios in new york city, this is charlie rose.

he is a co-founder of pay pal, one of the most creative entrepreneurs in all of silicon valley. in 1998 he started paypal with peter tiel and elan musk, four years later the company was bought from ebay for $1.5 billion. he has since launched a variety of companies. he started the customer view site yelp of which he is chairman. in 2010 he sold his social media company slide to google for $182 million. his latest project is a tech incubator hvf. i'm pleased to have him here at this table for the first time. but this not the first time i have met him so welcome. >> thank you. >> rose: yours is an interesting story. so bear with me so i talk about biography for a second. born in the ukraine. >> correct. >> rose: your mother was a scientist. your father was a playwright. what a great combination, you know. there is a culture there.

there's both sides of your brain have been full of dna from both parents. >> i like to believe so. >> rose: and you had in an interesting way a series of doctors predict that you would not live that much longer because of bronchitis. >> that is true. i'm amazed at your level of information. but that is true. my parents were apparently told several times that this guy is not going to work out for him until about two. and then after two they said maybe five. and then five, maybe seven and after seven they stopped listening to doctors and said he's going to be all right. >> rose: and then they moved to chicago. >> that's right. in 1991 we were finally allowed out of the country. and weeks before the country collapsed. so i left with a red soviet passport and a few weeks later i had a passport to a country that didn't exist any more. >> rose: and do you feel what in terms of where your soul is, is it american, is

it russian s it-- i would like to have a clever answer to this one. but i think i am now primarily, i define myself as an american immigrant. i'm very clear about where i came from, who i was and who i am. i'm very much an american. my formative years were spent here. i met most of the people that matter to me here, minus my family. most of my work has been done in this country. but i know that i wasn't born here and i know that my development is shaped by the immigration experience, by the experience of growing up in a country that did not have the kind of freedoms we enjoy here at this sort of political and business freedom. >> and what immigration has meant to america, among those who say is a proud part of the development and evolution of this country is something that we essentially must cherish and preserve.

i'm passionate about. it very divisive. just the fundamental notion of the melting pot, bringing people that have the ambition and drive to better themselves, better their fate, better their children's fate and pay back to the country that welcomes them is fundamental to who i am and i feel it is critical parker does not lose that. >> rose: in the process, not only doing well for themselves but doing well for the country by creating jobs. inventing things and doing a whole range of other things. >> yeah, i think that just cannot be understated. >> rose: so you made your way to the university of illinois at urbana champagne. >> that's right. >> rose: were you there when an creasean was there or not. >> yeah, we overlapped by a couple of years. >> did you know him. >> i certainly knew of him very well. we overlapped a couple of times in a hot dog place that he and i used to frequent. but he worked at national

center for computing application. and when the famous six left to start netscape a bunch of us undergraduates were hired to fill the holes created. in that sense i literally followed in his footsteps a little bit and after i graduated i followed him to palo aalto, event lyully. >> rose: mosaic was the first thing they did. >> that's right. >> rose: it really was, at that time. >> it was an amazing place to be. and i don't like the idea of luck but just because i feel like i should be shaping my own fate as much as possiblement but as far as having luck in my life, other than coming to america, being allowed to come to america, being on university of illinois campus in 1997 or 1993 through 1997 was just a dream come true for a computer scientist it fundamentally reshaped me from somebody who thought of myself first and foremost as a scientist, future ago demic to somebody who thought there is no better way to be than create

businesses. be an entrepreneur, that's what it is all about. >> rose: when did you get that? >> i can tell you the exact moment. i was sitting in the lab around midnight. and this guy walked in. and this guy reappears in my life, his name is scott banister, his friend, all these guys are earlier paypal mafia members. they walked in and said you seem to be here all the time writing code into the wee hours of the night why do you do that? i just do it because it's fun. i love building things. you should come with us and we'll start a company and you can do things that actually matter. it's like what a foreign concept. why not. i'm going to be here anyway. and that was the pivoting moment from that point on i never thought again about becoming an academic. i always wanted to have a company. >> rose: it wasn't idea are for ideas sakes it was idea that can be implemented to make a difference and create something that has products and people and -- >> yeah. >> rose: purpose. >> it went from building things for me to building things for others. >> rose: and so you made

your way to california. >> uh-huh. >> rose: and did-- what brought you to california? >> probably the better answer is why didn't you make it to california sooner. >> rose: why didn't you make it to california sooner? >> so i am an immigrant and i have very immigrant family and they said if you do not graduate college, it will kill, fill in the blank, your mother, your grandmother so i graduated college. >> rose: you better get that bachelor's degree. >> we had to haggle over the ph.d no bachelor, well, masters, no, no. >> rose: what did it have to be, bachelor. >> bachelor was enough. >> rose: it was a compromise. >> no less. i got my bachelors in computer science. and as soon as i could i packed up all my belongings and left for california. but i got here primarily because as evidenced by andreessen and many people after him, starting companies in silicon valley was the thing to do. late '90s, just the fabric

of the time, the place, the idea of being a computer scientist, and not building things for abstract sake but to make the world a better place. to bring-- we all used the internet well before the web became public domain, public knowledge. but as we saw things like yahoo! develop and netscape, all these companies. this is amazing, we have to be a part of it somehow. and where did you go. at that time i didn't know silicon valley existed so i spent a lot of time sneaking into free lectures at standford. summer of '98 was ridiculously hot in palo aalto so i would look up seminar for this, it was summer. so it was generally just show up. and somebody said there is this really young, brilliant hedge fund currency trader peter thiel you should get to know him. >> rose: currency trader. >> he was at the time i guess well-known for clever ideas around currency trading. he ran a small hedge fund and i knew his namement so when i showed up at sanford

that day looking for a place to camp to cool off, i saw him giving a lecture on currency trading. i know this guy, i should go see him. i went in, there were maybe nine or six other people in the room. and i sort of plucked myself in the back and said if it's boring i will nap. and if it's's not i will get to know this guy. and it was amazing. he really had, he was exactly that guy, the smartest guy you know with the best ideas. you just want to gand say hello. >> rose: he was that guy at the moment. >> yeah. and so i walked up to him which i normally don't do afterwards and said hi, i'm mark, i heard you of from leukin scottment i said we should have breakfast. all right so, we are had breakfast the next day and i showed up with kind ever a-- said what do you do. i said i start companies. that's great, i invest in companiesment i showed up with a bag full of ideas. i said here's my idea number one, two, three. he said i like that one. and literally that one evolved into paypal. >> rose: now who was there? because everybody makes a whole lot about the paypal mafia. and there is a famous

"fortune" magazine picture. >> yup. >> rose: and there you all are, some of you. some didn't come for whatever reason. >> uh-huh. it's a big group. so it's peter, it's you, elon. >> that's right. >> hoffman. >> jeremy of yelp. steve chen. >> and chad hurley, the three guys-- . >> rose: if you had to describe the one quality you all shared, what would it be? >> let's assume intelligence is given. >> we all knew we wanted to start companies. so we came to entrepreneurship from completely different points in our lives. but i think all of us were either starting this company and peter and elon and i were starting this company. and everyone else knew that this was basically their last job. they were going to do their own thing next. and this was training grounds. >> rose: yes. so i will just do this and then i will do my own thing.

and then i'll go and make a pile of money and then i will go do what i really, something else. >> i think that's what you think then. but when you wake up after the pile of money part, you kind of go the only thing i want to do is more of this. >> rose: exactly. but see that's is such an interesting process. you sell it to ebay, and it is very successful acquisition for ebay. and most of you left there was like boom, explosion out there of. >> uh-huh. >> rose: was the drive at that time to create companies and make a lot of money or simply create successful companies, the sheer i can do it? >> there was a lot of that. i think it is untrue to claim that we never counted any dollars. not at all. i think as a capitalist it's irresponsible. >> it wasn't we want to go out, maybe it wasment you want to buy yachts and planes and 17 homes and

fancy jewelry and clothes. >> no, no. i don't think any one of us ever measured our success in terms of the number of yachts or more possessions question possibly have. i think 2 was all about making an impact and leveraging the success in to bigger, better things. primarily in the form of other companies. >> rose: so you sell pay pal and you leave. this should be the best time of your life. >> it was the worst time of my life. >> rose: why? >> i had spent so much time generally very stressed but very happy working very hard that the vacuum of not having to work very hard at all, not having the drive. not knowing what the next day-- i was always overbooked. always 10 hours to do 20 hours of things. i would wake up and say i have 12 hours and i can read some magazines. it was terrible. it really was a very, very depressing time. and my now wife basically kicked me out of the house. and said look g start a

company out of something. >> rose: this is nelly saying get the hell out of here, you know, you can drive yourself crazy but you're to the going to drive me crazy. >> i think i was definitely driving both of us pretty far up the wall. fortunately i got better. >> rose: so what did you do, you then went and started an incubator. >> yes, so in part driven by my wife pointing out that i'm much happier when i'm work. i said i don't know what by am going to work on next. she said look, well, why don't you go rent an office and one, get out of here. but two, think about what you really want to do. organize yourself around going it to a place of work. and think and invent, that's what you do best. and i did. but i'm better in a group of people than alone. and so i set up this little office and we, my friends and i, would get together and brainstorm what could be and just try to think as big and interesting as possiblement and from those brainstorms, that's when slide was founded that i ultimately ran and eventually got acquired by google. and yelp was created there.

it's, you know, definitely-- it was a great time. it was very unstructured but it was a year of creativity. it was great opportunity. >> rose: when you build these companies are you always assuming that will you sell them or is it going to be like facebook which -- >> i very rarely, in fact never think of what is the terminal point. what is the exit strategy look like. i really don't like doing that because you're inherently limiting the outcome. you are always assuming how it is going to endment ideally i love the notion of a forever company. >> a forever company. >> yeah. >> there's not that many of those but the ones that exist are pretty impressive. >> you know, they always say some argue that companies are better if the founder stays with it. >> yeah. >> but it's just good. steve jobs and apple, you think of larry and ser gei at google, you think of mark at facebook. they add something. and sometimes they need talent to come in to do certain kinds of things in terms of management.

but in the end their presence makes a difference. >> i think so. i fundamentally agree with that. i think the dna, this is obviously a barred concept but there is a real nation of dna. the founders staying make sure the dna does not dekachlt i think that's the most important thing. >> rose: and that it's always changing. >> yes. david kkarp is here founder and c.e.o. of tumblr. in 2007 he started the company in age 20. it is now the preeminent blogging company with 3 million active users. "forbes" magazined noted it facebook is the internet's phone book, twitter its wire service and tumblr's karp has build the web's canvas. yahoo! announces-- announced it would purchase it for 1.1 billion. i'm pleased to have david karp at this table for the first time. welcome. great to you have here. >> thank you so much for having me. >> rose: how much time was

there between the idea that that is what i can create and the ability to create it? that canvas. >> probably took me a few months. and it was just working on my own blog. i was working on a little tool just for me. and at some point along the way it clicked for me like now, there might be some other people out there who have the same frustrations that i do. and look when we launched the thing we found some of them it wasn't like 100 million of them it was like a few thousand of them that showed up and were just as excited as we were. and a few thousand turn mood tens of thousands and in the first few months hundreds of thousands of creators who had found a real home on tumblr. >> and how do you decide, there are offers to buy this, now is the right time to sell. >> who is not expecting to sell the company this year, certainly wasn't looking to sell the company this was a really, really remarkable opportunity that presented itself. you know, again going back to just how much sort of dumb lukiw's had in my career and in my life. this was an unbelievable

opportunity to short-cut a lot of the very hard things that we were about to be going through. not say we weren't excited about all of these next steps but this is a chance to join a company that has a history, a legacy and a huge amount of resources around all of the sort of business stuff. >> rose: an why yahoo!? >> again, you know, it was a company in a position and with a legacy-- sorry, it was a company with a legacy doing exactly the same kind of stuff that we're hingeing our business on. it was a really creative brand advertising. they were the original digital media company. they took a very different approach to media. they approached media as an editorial team that created content and built creative brand advertising on top of that content. that's the future of our,

it's a big part of the future of tumblr business is creative brand advertising and something they built technology for old, also something they have advertiser relationships around and something they have a whole big honking sales force. they have a hugh money guess team and huge resources behind that effort over at yahoo!. they're at a place today, yahoo! and marissa and her team today are looking for a future for yahoo!, path forward and growth for that business. and that's where they saw a huge opportunity in this median at work that we were buildingment and what marissa showed me, what their team showed us was an opportunity for yahoo! to help us fuel in a huge way its development of that network and the development of our ad business. >> what will tumblr be like? >> hopefully we get this right, it will be home to

the most aspiring and talented creators all over the world. something that we've already started to do. i want to see all of them, not just calling tumblr their home but truly proud of the stuff that they're making, the stuff that they're creating on tumblr. the consume he -- consumer behavior so, what regular people out there in the world do, right now they spend a huge amount of time in front of their televisions consuming sort of, sort of premium content, someone call it stuff produced by publishers, networks, studios. you know f we're not already there today certainly five years from now i expect the vast majority of the content that we enjoy not to be produced by a handful of creators that are selected and supported by those big studios. >> rose: what excites you the most, the building of the business or creating the

product. >> so we have this-- look, i mean the product is why i got into this. i have to tell you the business end of this. has become such an interesting, exciting fun challenge for us because we've got this thesis. we can build a business that not only does not compromise everything that is special about tumblr, makes it such an incredible home for these talented people but actually makes tumblr a better place in the same way that if you ripped all the ads out of vogue, one t would be half the magazine, but two it would actually lose a lot of great content. the way we've approached advertising doesn't look anything like advertising across the rest of the internet today. so much of-- there's a lot of nuance here but so much -- >> explain it because the essence of what you are trying to do. >> i think i've always built things for myself first, the fact that tumbl started very selfishly is something just for me. and for years was really

just tiny small team where i was just like constantly pushing for features and capabilities that i wanted for me. that i wanted to use. and look there is one sort of defining thread in our tumblr, our team's culture, our company's dna, it's that we've managed to assemble this really uniquely, this is just hard to see i think unless you've really spent time in the tech industry, but we've built this really uniquely creative team of engineers. just like a really high concentration of people who moonlight in bands, are writing, are taking brilliant photos or brilliant photographers. >> that's what they do. >> moonlighting as stand-up comedians. we've got an incredibly creative team building tools for creators. >> rose: exactly. in other words, if you were a creator, then you have more appreciation and understanding of the need for the tools that you could

be better at. >> it helps us push the tools further it also just, it sets us up to, we wake up ef row day knowing that the most exciting stuff on tumblr isn't coming out of the walls of the office down on 21st street, our headquarters. it's going to come out of this community of, again, this army of creators. >> rose: global community. >> all over the world. >> rose: in a sense and they're speaking to each other. here is the other interesting thing. when somebody gets, has a kind of-- with yahoo!. sometimes cruiser users say this is getting too something, do you get any of that. >> in other words, users are saying i worry about this. i worry that this may change tumblr in a way that concerns me. >> yeah, they have every right to be concerned. >> rose: why are a what are their concerns. >> what are their concerns?

>> yeah. >> you know, i think we sort of have seen the story play out, one of a to you different ways. and one of the ways it unfortunately plays out sometimes is this thing that was special had its own unique characteristic, its own dna gets sort of absorbed or assimilated into some you know, portfolio of some parent companies where it's never the same after that. it loses all those characteristics that made it special, a little bit magical. and look, that's why i really worked hard on those words to our community. >> rose: tell me what your snapshots is of where the world is in terms of social media. >> uh-huh. >> and making consideration, facebook, twitter, instagram, tumblr. because there are those that are now writing because of your success and others, that the world is now moving

away from facebook and to this place that offers a home to do things beyond exchange pictures. first people to complain about that would be facebook, but go ahead. >> its first thing i would really point out is that we're not social. and we've tried very hard to draw those lines and build those distincts. tumblr is really about, or people come there for the tough they love. for art and media that they enjoy. you show up on facebook or instagram, twitter, a lot of these social networks for the people that you care about. if the people you cared about weren't there, facebook would be a lot less interesting. tumblr is actually, it's not so unusual but it's also not the norm to go on tumblr for the things your friends are creating. generally you go on there for this awesome stuff this awesome art and media in whatever general re is near

and dear to you. is being created by these independent creators all over the world. it's not about a personal connection so much as it is a connection to-- . >> rose: not about their work but what they create. >> that's right. so i think just talking about the social tools for a moment, i don't know. it's not really my jam and not something i think terribly hard about. i will say it's been remarkable to watch how quickly those networks move and are changing. you know, i think we used to think of social networks as these big impenetrable networks. we've watched them build up and then erode over and over again. and kind of faster succession. i don't know, i think it will be very interesting to watch how these big networks where we extend our relationships with other humans is sort of how those move around, whether that starts to stabilize. >> i don't think it will. >> in fact one of them was

yahoo!. >> well, yahoo! -- >> not a social media but a big company. >> i think just media. so what tumblr is media. people come here for art and media that they enjoy. why people go to yahoo!, and by the way it's one of the things that made it a pretty resilient network. if you like your movie trailers, your news, they can cope showing up and enjoy it. it is-- if it's one of the sort of incredible things about social networks is how quickly they can be built up. the viral coefficient that allows them to explode overnight, and all of a sudden you have vine or what'sapp or instagram, tens of millions of people that are using and interconnected. at the same time though once a few of your friends start to leave and spend time somewhere else all of a sudden the whole network will fall away. if there is great content over here whether a tv network or web site or a big network like tumblrf there

is something there that you care about, some things, some stuff, you can keep going whether or not your friends are still using it. you still show up and enjoy all that stuff regardless. that's where i think media tends to be a little bit more resilient than social. at least in terms internet-net works. so we'll see. i don't know. >> marc andreessen is here. founding founder of the company formed, it has stakes in facebook, four square, groupon, skype and twitter and others. forenaz in the remark rbl career of marc, co-founder of netscape first commercial web browser sold to aol in 1998 for $4.2 billion, then created a cloud compute beical loud cloud sold to hewlett packard for 1.6 billion and

taken an active role, he sits on the board at ebay, hewlett-packard and facebook. wired magazine called him the man who makes the future. he is in new york this week for the forbes summit. i'm pleased to have him back at this table. welcome. >> great. > i think it's a little bit different than that. i don't think it's some of the head start. i think it's the core idea that we have, the core theory is the fundamental output of the technology company is innovation. and that's very different than a lot of businesses. the fundamental output of a car company is cars or of a bank is loans. the fundamental output of a tech company is innovation. so the value of what you have actually built so far and are shipping today is a small percentage of the value of what you are going to ship in the future. if you are good at innovation. and so the challenge tech companies have is they can never rest on their laurels with today's product. they always have to think in terms of the next five years of what comes next. and if they're good at