Even in Silicon Valley, the home of the ever-present origin story, Chamath Palihapitiya has a pretty incredible narrative. The Sri Lankan immigrant escaped a civil war in his homeland before eventually landing a job at a new company called Facebook. Then he started a venture-capital firm that is now among the most formidable in the Valley. He is also an owner of the Golden State Warriors, the defending N.B.A. champions, who are on pace to the achieve the greatest season in league history.

Palihapitiya’s firm, Social Capital, has backed numerous tech companies with valuations in the billions, such as Slack, Box, and SurveyMonkey. But that doesn’t mean that he is bullish on unicorn culture. Here, Palihapitiya speaks about Mark Zuckerberg’s secret sauce, which start-ups are going to make it, and the saga between Apple and the F.B.I., among other topics.

Vanity Fair: You were at Facebook early on in the company’s history. What’s the best advice you learned from Mark Zuckerberg?

Chamath Palihapitiya: The most amazing thing about working with him is how even-keeled he is. He’s very happy to just be the last person to talk in a room. So he’ll just sit there, and you’ll tell he’s actually actively listening and thinking about everything people are saying. He had this amazing ability to unpack what was anecdote and what was fact.

Back then there was a very turbulent phase in our company. We had a lot of ups and downs. We had a lot of scrutiny. One day we’d be getting sued by the F.T.C., the other day we were celebrated for being the next great company. In all of that tumult, it was really important to stay as calm as possible and think as far out as possible. I think that’s what allowed him to ultimately turn down the acquisition offer from Yahoo. It’s what allowed us to negotiate really important financing from Microsoft. It’s what allowed us to invest and take a bunch of shots on some random things, like our online advertising, that has turned out to be a huge business.

Funding is slowing down, both in seed rounds and mega-rounds. There have been fewer tech I.P.O.s recently, more companies are raising down rounds. Are we in a downturn?

I think we’re in a phase where we’re realizing that the people who have been allocating capital thus far have done a horrendous job. Most people’s inherent reaction is to make sure they never lose their job, and so they become risk-averse. I think what we’ve had is a handful of investors who have extreme vision who make great investments in things that are amazing businesses: Facebook, Google, Uber. And then everybody else reacts to that success by trying to do the thing that most approximates the thing that’s working. As a result, most of those businesses are fundamentally not good, they’re poorly run, and they never should have been invested in in the first place. But the capital came in because the person who had control of the capital was able to justify it intellectually to themselves versus something else that could have become the next Facebook or Google.

The reality is, great companies can go public in any market. When we talk about the I.P.O. slowdowns what we’re really saying is that there really just aren’t that many good companies being built. We need to divorce ourselves from venture capital as an occupation and focus on using capital as a way to take really big bets on things that just seem totally audacious. Right now we haven’t done enough of that, and the result is that most of the things we’ve funded are mostly crap and largely worthless.

What advice are you giving Social Capital’s portfolio companies in the event of a tech bubble burst or correction?

There's a tension between investing in visionary companies versus investing in beauty pageants, and we have always erred on the side of the former. When nobody else is funding cancer research, we were funding cancer research. When nobody else was funding diabetes, we funded diabetes. When nobody else was touching asthma, we were spending enormous amounts of money on asthma—all of these things that frankly take lots of time to build. Around the early part of 2015 we came together as a partnership and said that the most important thing that we can do is get every single one of our companies well financed, and make sure they really understand that they need to make this money last for two to three years.

We’re trying to coach our C.E.O.s that the window dressing is both expensive from a cash perspective and tremendously expensive from a culture perspective. It distracts the team from building what they need to build. Don’t waste money on things that get away from your mission, which confuse employees about why they’re actually there. Meaning, the quality of the office and the quality of the food are all part and parcel of a lack of discipline, which speaks to the fact that the mission isn’t compelling enough. Because I can tell you what it was like at early Facebook: the food was terrible; we’d ship in lunch and probably two to three times a week the lunch had maggots in it. But we were there because we believed, and it didn’t matter.

What are the characteristics of the companies you see surviving a downturn?

If you look back, historically, companies like Microsoft or Apple have taken 25 to 35 years to get to the kinds of valuations that Facebook got to in 10 years. And the reaction to this in Silicon Valley is to try to find things that work really quickly. Over the last seven or eight years, Silicon Valley has really fallen in love with fast growth. Part of this is the risk aversion of the financiers, who themselves want to have short-term wins and want to fund things that look like they’re working in the short term.

But the problem with things that work really quickly is that they can stop working equally as quickly. Valuable companies take decades to build. We try to find businesses that are technologically ambitious, that are difficult, that will require tremendous intellectual horsepower, but can basically solve these huge human needs in ways that advance humanity forward. Those things don’t necessarily take lots of money, but they generally do take lots of time. And they require really mission-driven people. But when you build those companies, my gosh, they are so enormously valuable.

The businesses that, in my opinion, are worthless are many of these negative-gross-margin businesses that grow really quickly. Because the growth doesn’t indicate any long-term business value.

What kinds of companies are you talking about, specifically?

Most companies in e-commerce right now are negative-gross-margin businesses. Amazon has such enormous scale, and they’re at about 13 or 14 percent gross margins, but on a huge number. In order to compete with Amazon, these businesses have to sell goods for less than what they cost. These companies are in the delivery businesses (Postmates, DoorDash, Instacart) and in the food business (SpoonRocket, Munchery). Basically, a lot of these new-generation, remote-control-type businesses—where the phone acts like a remote control to replace an offline experience—are generally, to date, highly, highly, highly unprofitable.

There’s a lot of what I call “venture philanthropy” to prop these businesses up. Time will tell whether any of those can become a real business. If a shoe costs $20, Nike doesn’t sell it for $14. They sell it for $400. We have to get back to this world of having pretty reasonable discipline on business models and understanding that many of these gross-margin businesses will never, never break even or become profitable.

A number of V.C.s have been calling on mature, late-stage companies to go public. There’s even been somewhat of a quiet rally in the public tech stocks recently. Is now the time for big, late-stage companies to go public, or does it make sense for companies to stay private longer?

Any company that is making its decision based on external timing is probably not in control of their own destiny and should probably not go public. Facebook could have gone public whenever it wanted. We decided the right time was 2012. It could have easily been 2010 or 2014. When you hear the call for these companies to go public and there’s pushback and they don’t, what’s really happening is the realization that the structural strength of their business is not yet in place. So they’re worried about how the public market will react once they have to transparently demonstrate what their business will look like. The great companies can always go public whenever they want; every other company is trying for some window of time where there’s essentially some combination of intellectual laziness and greed in the public markets that will allow them to exploit a window.

You’ve voiced your support for immigration reform. Can you talk about why that’s important to you, and why it’s important for the country?

I’m a living testament to the value of immigration. I escaped a civil war, and I came to Canada as a refugee, and they gave my family protection. I did my best to pay that country back, and I think I did that. I emigrated as a knowledge worker to the U.S. The U.S. gave me a shot, and I think I’ve repaid the U.S. in enormous ways.

I’m also fortunate enough to be a co-owner of a basketball team. What you see is that when you try to recruit the best people, you can win. In the case of the Warriors, they recruited based on skill and culture. It’s another way of reinforcing to me that America is this shining beacon where the best of the best want to be there.

A number of tech companies have aligned themselves with Apple in its legal entanglement with law enforcement over the San Bernardino shooter’s iPhone. A few others, including President Obama and Bill Gates, have taken a middle-of-the-road approach. Where do you stand?

I’m more on the side of the government on this one. I think we’re almost lying to ourselves in pretending that Apple can’t do something that they do every day. Instead, what I think has happened is we’ve started to fall on our sword on some weird marketing thing. They want to seem like they’re on the side of the consumer. But there’s nothing stopping an Apple engineer today from rooting your phone and taking whatever they want. It’s a bit of a red-herring conversation right now.

This interview has been condensed and edited for clarity.