Ethan Agarwal strikes an unlikely figure for a potential governor of California. At 40, he oozes millennial vibes in a casual button-down and scruffy facial hair, and seems more like the founder of an online workout platform (he is one) than a typical pressed-suit Democrat.
As the “fiercely pro-capitalism” candidate demonstrated last week in a 45-minute sitdown with The Standard, his ideas don’t neatly fit the classic Democratic model. In fact, he says, he’s not even sure what a Democrat or Republican is these days. And he refuses to say who got his vote for president last year.
Highlights of his agenda include moving the state capital from Sacramento to San Francisco (or Los Angeles; he’s flexible), allowing tax payments via crypto, and encouraging public workers to leave government for private-sector jobs.
A graduate of the Wharton business school, Agarwal consulted for McKinsey & Company for three years before founding the audio-focused fitness company Aaptive in 2016. He sold it in 2021 before cofounding the financial services startup Coterie, which is backed by Andreessen Horowitz.
Agarwal’s entry into the crowded gubernatorial race received a less-than-enthusiastic reception, with his announcement video getting just 30 likes so far on X. Still, he believes he can find a supporter base among the “lost Democrats” of California.
This interview has been edited for length and clarity.
The gubernatorial field is crowded with household names like former Rep. Katie Porter and former Health and Human Services Secretary and California Attorney General Xavier Becerra. Why do you think you can best them?
I come from a not-at-all-political background. I think that’s what people are looking for. So when you look at [President Donald] Trump, you look at [New York City mayoral candidate Zohran] Mamdani, you look at [San Francisco mayor] Daniel Lurie, it’s not politicians who are getting elected to office. [Note: Mamdani is an elected official in New York.] I think it’s actually kind of hard to defend a political record in California and say, “Hey, look what I’ve done.” What is the answer to that?
I think Katie Porter is very smart. I think Xavier Becerra is very smart. I know [former L.A. mayor] Antonio Villaraigosa. I think he’s very smart. I think these are good people who believe in the things that they are saying. I just happen to think those are the wrong things. And I think that the voters are looking for someone different.
Is there anything in particular that you think Gov. Gavin Newsom has done that you would do dramatically differently?
Yes. [laughs]
What’s your opinion of Newsom?
I think the biggest challenge with Newsom is that he wants to be president, and he has led the state in a way that is designed to help him become president. And what that means is you can’t piss a lot of people off. You need to keep everyone as your friend, and if you don’t piss anyone off, you’re not gonna get anything done. I think Newsom has been probably a little too public-sector friendly.
It’s becoming way too common for people to see the state government as their default employer of choice, as opposed to a company. I think that’s bad for everybody. I don’t mean teachers, police officers, health inspectors, public-sector folks, firefighters — all those people we definitely need, and we need to pay them more. I’m talking about the people that are civil service workers, that are doing work for the DMV’s back office or whatever, that are reviewing insurance claims, things that are not exciting or directly contributing or that are not scalable.
Are you thinking of a DOGE-style effort, slashing those jobs?
No, I don’t think you should slash at all. I don’t think that’s effective. But I do think that you need to provide those people with more [private-sector] job opportunities than they have today, and they’ll self-select themselves out of [the public sector].
Tell us about your proposal to move the capital of California.
The typical criticism I get about that is that it would decimate the economy of Sacramento. But the larger issue is that one of our major cities’ economies is tied to the state government. It shouldn’t matter where the state government of California is based. If we move it to SF or L.A. or wherever we move it to, it shouldn’t be seen as a massive source of employment.
What would you offer to the people of Sacramento instead?
I’ll give you a perfect example. DoorDash is a $100 million company that wants to start testing autonomous delivery robots. California not only didn’t allow them to test it; California doesn’t even have the infrastructure in place that lets you decide whether this is a good idea or a bad idea. So instead, they went to Arizona, and Katie Hobbs — the governor there, who is brilliant — welcomes them with open arms. Now they’ve opened an R&D center there. They have several hundred jobs — people making six figures that are testing out autonomous delivery vehicles. Those are our jobs. Why did they go to Arizona?
Have you guys been to Phoenix recently, by the way? Phoenix is exploding; everything is new and clean. There’s people everywhere, there’s construction everywhere, there’s cranes everywhere, beautiful hotels. Shopping is packed. Every store is Gucci this, Lululemon that. It’s an incredible city. And then you come back to SFO, and it’s, like, sad and depressing. And I think what Katie Hobbs has done is just so impressive, and I respect her so much.
Recent polling has shown that the majority of California voters feel that tech and AI companies do not have their best interests at heart. How would you address those concerns?
Every new technology in the last 500 years has been feared before it was loved, whether that’s the internet or cellphones or even radio or cars. Whatever it is, when it first comes out, people are scared. [AI] is a little scary right now because we don’t understand it, and I think that as people start to understand it and start to use it and start to see how it benefits their lives, fear will turn into, like, “Why are we not using this?”
Do you think there should be guardrails around AI’s development?
Absolutely. But I think we need to understand it before we start to put guardrails on it. We don’t know it well enough yet. It’s too new of a technology for us to understand. And I don’t think the government especially knows it well enough. Right now, we need to let it flourish before we understand what it is that we’re actually protecting.
You call for more housing, more development, more infrastructure. It has echoes of Ezra Klein’s “abundance” movement. Do you have a position on that movement?
I think Ezra Klein is smart. I don’t really align myself with anybody. Like, I’m a Democrat, but I honestly don’t know what those words mean anymore. I don’t know what a Republican is. I don’t know what a Democrat is. I think the ideas behind the abundance movement are consistent with my ideas. So in that sense, yes. But I’m not, like, the “abundance candidate.”
Newsom has taken a combative approach to the White House in recent months. How would you approach working with the Trump administration or Republicans in Congress?
I think the governor of California needs to focus on California. I think they need to stop trying to be a national figure or run for the Senate or try to be a Cabinet appointee or whatever, which is what a lot of people do. We need someone that is focused on California.
I don’t need to engage Trump, because California is a net contributor of resources to the federal government. We don’t consume resources. So I don’t need to engage Trump, and neither does any other candidate for governor or any Republican outside of the state.
What if Trump tried to send National Guard troops into L.A. again, or to San Francisco?
I’ll tell you something about this National Guard thing. I think the reason Trump’s not actually getting that much pushback is because a lot of people that live in these cities are saying, actually, we do need to clean our city up. And it kind of is working in D.C.
So I don’t feel strongly as to whether it’s the National Guard or local [law enforcement], except the local force is going to know the towns much better, so I would prefer that it be that. But my general feeling is, is this something that’s good for California? And if it is, let’s do it.
People call you the Silicon Valley candidate. Who in the tech world do you think you’re most aligned with politically?
Garry Tan, I think, does a very good job of being objective, and he just cares about what is good for San Francisco. He’s a very selfless guy, and I agree with probably 80% of what he says.
[Tan, the CEO of startup accelerator Y Combinator, told The Standard: “Ethan Agarwal is a good candidate for California governor, but I have not endorsed anyone as it’s still early in the election cycle. I will continue to follow the race closely before making any decision.”]
Are you aligned with the crypto-friendly stance the Trump administration has been taking?
I think there’s a bunch of things that we can do in crypto. One is we should let people pay their state taxes through USDC [a cryptocurrency pegged to the U.S. dollar], because there’s no reason we can’t support a stablecoin for paying our taxes.
What about crypto regulation?
I think the existing regulation is actually very good. I think [White House crypto czar David] Sacks has done a good job of figuring out what the line is. I think the [Securities and Exchange Commission] could move a little bit faster in providing clarity for some outstanding issues related to crypto, but I actually think they’ve done a pretty good job.
Who do you see as your base showing up at the polls for you in next year’s primary?
I think that California has a group of people that are, like, lost Democrats who — if they were old enough — voted for Bill Clinton, Al Gore, Obama, Hillary Clinton, may or may not have voted for Kamala. And then now they look at Bernie Sanders, Elizabeth Warren, and [Alexandria Ocasio-Cortez], and they’re like, “That’s not really my Democratic Party.” And then they look at the Trump administration, and they’re like, “I definitely don’t want to go MAGA.” So they’re kind of lost Democrats.
That’s me. I’m an Obama, Clinton kind of Democrat. I’m not an AOC, Warren, Bernie kind of Democrat, and I don’t identify with the MAGA movement at all. There’s a lot of people here that don’t identify with the Democratic Party, and I think that they will see in me someone who thinks like them and hopefully support me.
Who did you vote for in the presidential election?
I’m not sharing that because I don’t think it matters who I voted for, or who any of these other candidates [for governor] voted for. I want to know what their plans are and how they’re going to get them done. And that’s how I would ask people to judge me.