All-In with Chamath, Jason, Sacks & Friedberg - E125: SpaceX launch, Fox News settlement, "Zombie-corn" exodus to AI, late-stage implosion

Episode Date: April 22, 2023

(0:00) Antonio Gracias and Gavin Baker join to discuss SpaceX's Starship launch (28:58) Fox News settles with Dominion Voting Systems, will pay $787M (40:38) AI update: Reddit to start charging for training data, how the next startup bubble will materialize, navigating the AI "dust storm" (53:49) Why AI is challenging/exciting to invest in right now, late-stage implosion, pay-to-play rounds (1:21:26) Is crypto dead in America? Plus DeSantis vs Trump polling update and wrap Follow the besties: https://twitter.com/chamath https://linktr.ee/calacanis https://twitter.com/DavidSacks https://twitter.com/friedberg Follow the pod: https://twitter.com/theallinpod https://linktr.ee/allinpodcast Intro Music Credit: https://rb.gy/tppkzl https://twitter.com/yung_spielburg Intro Video Credit: https://twitter.com/TheZachEffect Referenced in the show: https://twitter.com/GavinSBaker/status/1649107858267439108 https://www.bbc.com/news/science-environment-65294084 https://twitter.com/thePrimalSpace/status/1649051677377560578 https://www.wsj.com/articles/spacex-starship-elon-musk-second-launch-attempt-bf932aaf https://twitter.com/elonmusk/status/1533408313894912001 https://www.reuters.com/technology/fcc-votes-approve-spacex-satellite-plan-official-2021-04-27 https://www.axios.com/2023/04/18/fox-news-settles-dominion-lawsuit https://investor.foxcorporation.com/static-files/3b2bdb74-8ebe-4173-9f0f-ac18831ff094 https://www.theatlantic.com/business/archive/2015/03/finland-home-of-the-103000-speeding-ticket/387484 https://twitter.com/KanekoaTheGreat/status/1648462770936115202 https://www.nytimes.com/2023/04/18/technology/reddit-ai-openai-google.html https://www.cnbc.com/2023/04/20/alphabet-merges-ai-focused-groups-deepmind-and-google-research.html https://twitter.com/chamath/status/1647010187377774596 https://en.wikipedia.org/wiki/Dal%C3%ADland- https://www.nytimes.com/2023/04/20/business/buzzfeed-news-shut-down.html https://www.vox.com/technology/2023/4/18/23688627/meta-layoffs-mark-zuckerberg-facebook-instagram-whatsapp https://news.crunchbase.com/venture/series-c-funding-decline-q1-2023 https://www.theinformation.com/articles/tiger-global-managements-12-7-billion-venture-fund-records-20-loss https://en.wikipedia.org/wiki/Greater_fool_theory https://www.wired.com/story/stack-overflow-will-charge-ai-giants-for-training-data https://www.coindesk.com/business/2023/04/18/coinbase-could-move-away-from-us-if-no-regulatory-clarity-ceo-brian-armstrong https://news.yahoo.com/poll-trumps-big-post-indictment-bounce-is-fading-fast-183753992.html https://www.washingtonpost.com/politics/2023/04/20/desantis-trump-new-hampshire-poll

Hey, everybody, welcome to episode 125 of the all in podcast on an historic day. We're taping 420 really excited that SpaceX was able to launch Starship and it made it off the launch pad an incredibly successful today, day today. We have, of course, with us the Rayman David Sacks, the Sultan of Science, David Friedberg, and of course the dictator, Chimouth Polyhapatia, but two special guests are here, special guests. Gavin Baker from a trade-ease? How do you pronounce it? A trade-ease.

A trade-ease. How's the trade-ease? How's the trade-ease, if you know Dune? And then SpaceX board member, Antonio Grossi asked one of the first investors in SpaceX and Antonio, a big day for you. Maybe you could just tell the audience what happened today, why that is so important in the history of this company. Well, first of all, thank you guys for letting me come on and have a little chat with you

about this. Today was extraordinarily important for SpaceX, I think, for America and for humanity. And the starship is the realization of the vision head, Elon had 20 years ago, 25 years ago, even as a child, really, to go to Mars. And the engineers here at SpaceX and the entire team working extremely hard are really just to get this vehicle off the pad as you know that's sad right. This is a brand new vehicle. Everything about it is new. So the engines, the material science, the structure, the design, all of it new. And the most important thing here was to get off

the pad, sweet product data. And this technology platform is the platform that will allow us to go to Mars. So from a non-engineer standpoint, why this is important is that what we've proven with this flight, we got past a point called BaxQ, which is the point at which the vehicle takes maximum stress. That's all I think about it. It's your engineer to tell you a lot more unscription to it, or David Freeper give you a better script to it, but it's the most going to stress in the vehicle, which means that this vehicle will get to orbit. And this is the vehicle that's going to take us to Mars. So today is the day that all of the hardware

and people at SpaceX accomplished a goal of making the human race space-faring. When we look back in history, I believe this will be the day when we mark the technological development that we broke through and built a vehicle that could actually go to Mars. Now, when we look at it, obviously obviously it didn't make it too orbit. Maybe you can give some context into what is the typical life cycle of a new rocket ship

coming out. The Falcon, the original one, has done I think 224 missions, 222 of them successful, I think 106 or so, actually landed themselves. Yes. And so you had two or three Mulligans, I think, in the development of that, maybe two, actually. So what can we expect here? Where are they going to stack and rack

and launch the next one in Tonyo? Let's see, what's the timeline here to getting to orbit? What would we expect versus some of the other projects that we've seen like the Russian rockets? So look, this is a brand new vehicle. And whenever we develop a brand new vehicle, it takes a long time development. You know, my understanding, all this is as again, a layman and sort of as a a board member, not an executive here, is that it'll take at least two or three months, two or three

months to really get the pad rebuilt and get another vehicle back on for testing, maybe longer. But it's really important to note here that we've gotten sort of used to the idea that SpaceX launches rockets and all these rockets come back and all those vehicles are stable because the Falcon 9 and 9 heavy are so stable and they're so well engineered and they're amazing vehicles. The most reliable vehicles on earth in human history. This is a brand new vehicle. This was a huge win.

I mean, it was an enormous room for the company, an enormous room for the country, just getting it off the pad and collecting the data. And now we know it works. We just have to get it stable now and get up to orbit. So it's really, it's a hard problem, but it's a solved problem from here. And the learned here is that this vehicle does work. Amazing. Can you guys talk about the impact of this vehicle,

cost to launch payload, like the big metrics that kind of help realize that outcome? Gavin, I think I saw you did a bunch of really good tweets on this. You shared some of the metrics that I thought were really succinct and really helpful. Yeah, sure. So when this is, I think it's a long road

to full reusability. The first app will be mechazilla catching the booster. It doesn't have a legs like the Falcon 9. And the second step will be landing the Starship, which is really hard. But once you do that, they should be able to send over 100 metric tons to Orbit at a variable cost of under $2 million per public data. These are public statements. I would never confirm or deny those statements. Get this gap, it's just Gavin's math.

They're all the back of the envelope. $2 million is the cost to get 100 times into orbit. That's the metric. Variable cost. Variable cost. So I think the point Gavin's making, if I might just put that, is that it metric? Variable cost. Variable cost. So I think the point Gav is making if I might just put that is that it is a step function change.

It's not like a small change, it's an enormous change. Right, can you compare that to the numbers before for folks to understand? The Falcon 9 mass to useful orbit is 17 metric tons and the variable cost that you know I have seen Elon tweet about is somewhere around $15 million. So you are lifting more than five times the massed orbit and based on other statements that 100 metric tons is a very conservative estimate and you're doing it at call it

10 to 15% of the cost. So this is a, you know, we can all do the math, but we can envelope it, you know Roughly a 50x huge change and this, you know, massively changes the unit economics for Starlink for sending anything into orbit This massively changes the unit economics for Starlink, for sending anything into orbit. And as Antonio said, it's great for SpaceX, it's great for America, and it's great for everyone on the Earth. It's great for humanity. Can you explain how that then translates into going to Mars?

So now we can get a hundred tons into orbit for two million dollars. What happens next in terms of how that payload capacity and low cost enables full transport to Mars. I know that the timelines are tough, but it would be super helpful to translate the orbit concept into the, let's go to Mars concept. It's important to know that the size of this thing, the sense of scale, is the interior space of it, is the size of the International Space Station. So it's a huge amount of tonnages. Think about all that's going to take to get to Mars, right? You've got to, you have to lift payload into orbit, you have to, you know, create a base either on the moon

or in, it's orbiting the Earth to actually refuel ships and send them out into space. And this same design will scale up to become the Mars Colonial Transporter Versaular Design. That's why it's important. And look, the timeline that I don't know, I'm hoping that it will be, while I am silly, it will go. That will be great, physically, it will go. But that's really why it's important.

I think this is a small version of the same vehicle. We will actually use to go to Mars, and then all the stuff you have to transport to orbit becomes more economic, because as Gavin just said, 50X kind of reduction in cost. Can I ask you another question? Sorry, I don't mean to monopolize the questions, but these are things that I think are super important

questions. But that a lot of people often ask, or I hear them asking, but what happens with the space industry in the near term? So there's this great long term goal, get to Mars. That's a big project. But there'll certainly be funding, I'm sure, to run that project. But what other economies now emerge

as this cost down of 50X happens? And what else do you think happens besides communications and Starlink, obviously, that's already a pretty scale business. What other markets can develop here in the near term? What other economies do you see happening as a result of this cost down? Yeah, I mean, look, Gavin, you're jumping here too, but the reality is once you can take that much mass to orbit, you can move anything around the planet very quickly. You can kind of go out, but it's a bit of a spin-down. So transportation generally changes.

You know, if you want to fly to Tokyo from New York City, it goes from being, you know, a day trip to a matter of hours. It's extraordinary. Or a container ship in a couple hours. Yeah, everything that's wrapped around the earth, you're running packages around there, it's having its faster. Kevin? Yeah, there will be no more trans-Pacific or trans-Atlantic cargo flights. I think in five, six, seven, eight, ten years, you're going to need a big starship to accomplish

that. But I think the transatlantic and trans-Pacific aerospace cargo routes go away. So, transportation logistics, I think, is a fundamental change, human transport, fundamental change. And there's all the knock-on effects of building technology. The space program, the American space program that took us to the moon created the cell phones we use, right? I mean, there's so much chip designs, all the technology came off of that. The same kind of effects we believe will happen here.

So, it's hard to predict, but it will be a lot of great stuff. Well, on that, that's kind of the point. When you can get payload up there, now entrepreneurs can think of a million different crazy ideas and affordably put something up there. Whether they want to mine an asteroid asteroid or they have a science project. Now a thousand flowers, a million flowers can bloom and then entrepreneurs can start thinking about it. And that's already happened to a certain extent with Falcon that people are able to come

up with great ideas. Well, I have to say. And inspiration provides. It does. It's amazing to be here. And fuel the inspiration fuel inspiration and just the general. I think that's what I was going to ask you about, as we wrap here with you too, if you could take people inside a mission control, which would be privileged enough to be in

the sense of history and the feeling in that room, if you could describe it for the audience, what those engineers were feeling, and what you in fact felt at that moment. Antonio and then Kevin. So I would start by just opposing with Monday. So we were here Monday. We were here Monday. And Monday, I think there was a real sense of concern.

The countdown sat around 10 minutes, the vehicle we had a valve failure and valve that stuck open basically. And we had a stop and kind of regroup. And by the way, from my perspective, that's like a solid success because the vehicle did not get destroyed in the pad, which is like the number one thing to have happen here. So success. The second, and so that was kind of Monday. And I think Monday was, yeah, caution and intensity. It was a very intense, very intense way. Can this, will this ever happen? Yeah.

When will it happen? Yeah. Today, what I felt in that room was a sense of, there was a high sense of intensity, a high sense of focus, and also a sense of people were excited. There was an excitement about it. It felt different today. It felt more electric today. They were super focused, but you could feel the excitement

in the room. They believed it was gonna happen. They thought it was highly probable and that it was gonna work. And when it did work, I would say it was a sense of elation and joy. And just, you know, this is this is 20 plus years of work. And, you know, Elon was here in the room with the engineers, and it just seemed him light up,

seemed to joy that he felt, seemed to joy the engineers felt together for me. And I haven't been a board member here in an investor for a long time and sort of been a long this company and scene developed. it brought a real sense of hope for what's gonna happen to this country and what's happening to humanity and it's such a joy to me. Yeah. Gavin, do you have any emotional feelings there

when you watch that you wanna add? Yeah, well, I think it's also just what I would have, what always strikes me when I'm here is this is a sandy spit of land. There is no power, no electricity, no potable water, no sewage, no utilities, nothing. And out of this, you know, Sandy spit of desert, you know, on the Gulf of Mexico,

extremely talented group of engineers, the last five years have lived in, you know, these, these air streams, you know, a long way from a major city. And it is just an amazing place to visit and the sense of commitment. And when you talk to anyone at SpaceX, anyone here at Starbase, what are you trying to accomplish, make humanity a multi-planetary species? Get too much. The experience of visiting star bases is amazing. Second, I would just say launches are very visceral. It's shocking if you have not experienced one. The ground shaking. Feeling your chest, you feel it.

You feel your body shaking like an earthquake, but it doesn't stop. And it's incredibly dramatic. The rocket, it's going so slow at first and then it accelerates. And then you hear this enormous crackly noise that's louder than any concert, louder than any sports stadium. Then a blast of hot air hits you. You feel it. And I would say a lot of people at launches cry. It's a very emotional experience, often for people who are who are not

emotional. Yeah, hard not to get emotional. I think just that human beings can accomplish something like this. It is amazing. And then what I would just say is, you know, there was the rocket flew for four minutes and went through Max Q. It went to 39 kilometers. The Soviet N1, which was comparable rocket only reached 12 kilometers. Like the team was ecstatic. Yeah. The joy on their face. It would be cheering. You've never seen anything like it. Yeah, it was awesome. It was very inspirational and I felt very grateful to be there. Yeah. Incredible.

Yeah. Can I even one thought of what I'm thinking right now? Yeah. The after effect. The after effect. After a glow. It's just an historic gratitude. I mean, there has been so much sacrifice here and we wouldn't sit over 20 years from

from Elon, of course, and the amount of just, you knowcomfortable worth one from him and the entire team are at space as engineers Everyone works here. Yeah, it's been extraordinary and it just really I'm just deeply grateful Incredible and grateful to you all for having us on. Thank you. Ah incredible It's great to hear that perspective because you would not have gotten it from off the Twitter feed You know from the mainstream media David if you'd come here with us, you could have gotten yourself a good invite. Yeah, David, you were invited. You were invited.

We almost shank hide from the invite. I'm sorry. I'm sorry, is it supposed to shank hide? We're going to shank hide. I know. I'm going to start ship you next time. Yeah, I'm bummed I couldn't be there, but I'm excited to see how excited you guys are. And just the point I was making

is that when I was reading the mainstream media coverage of this, it was almost like ghoulish. It was like a type of glee. It was almost like a cyber, that the rocket blew up, but they didn't really mention any of the things you're mentioning. I mean, from the point of view of the people who are there, it was a triumph, and it was exciting because of the data that was collected and the fact that this rocket even got off the earth and achieved this draw. This is a draw for four minutes, but the media never really conveyed that. So thank you for giving us a perspective that you just would not have gotten today from

the New York Times or other mainstream media. And just to add, that's just a little bit of context. This is an iterative design process with rapid improvement. This starship had 31 engines that were made over the course of one year, had different tolerances, behaved unpredictably. This was far from the best starship. The one that's going to launch in three months, or two months, or four months, or five months, or whatever it is, they've already made over a thousand discrete improvements to it. And it was before they got all the data for today. And then there's a starship after that. And after that.

So I think that's the... It really is what the mainstream media just failed to understand is the process under which a new rocket platform is deployed and how revolutionary this is, they are iterating at a speed here that I don't think people can comprehend. I mean, on this note, it's not important. They don't care. They don't care. And it was a way to paint somebody who they dislike and they are threatened by it in

negative light. The front page of the Wall Street Journal says SpaceX's starship explodes shortly after launching uncrewed test flight. If you take Antonio Gracias' explanation, which was articulate and transparent and fair, and this headline, you could not be more further apart on the spectrum of truth. Antonio just said that this is a day, this is for the audience of which there are millions of people now. And Tonyo said this is the day that you'll look back on when we are multi-planetary as this Cambrian moment, if you will, this incredible point of innovation and human ingenuity and teamwork and sacrifice. You know, Gavin said it as well, just giving up five years of your life to move in the middle of nowhere live in an air stream trailer

And then the washroom was basically perspective is I Mean it's just fireworks I know to my own team show I just said look ignore please ignore the news media. Yeah, it's total BS This is a huge success. Fake news. It's a huge success. And, you know, we should just step back for a second and enjoy success because part of the problem of the news media is, this is a moment

that should galvanize our country. I mean, it's basic. This is about America. This is an American company. This is about America. I think they can't see that it galvanizes, potentially galvanizes support for a human being that they feel deeply threatened by and that's what it all comes down to ultimately and that's what you see in the headlines. That's why what's so interesting about this is that the behavior of the mainstream media to now paint this as something unsuccessful or a joke or rocket goes boom or fireworks. fireworks, when you look back on something as meaningful as this, it'll just make them even less credible. That's what that's unfortunately what they're doing to themselves, is shooting

themselves in the foot. It's pretty sad. Yeah, and this was just a military journal. This is CNN, New York Times, everybody just painted it as a failure. And it's like, oh, here's a collection. Yeah, the line's well done, producer. I mean, literally, you would think if you were at the mainstream media that SpaceX failed. And really, when I was talking to Elon months ago about this, you know, he said, listen, 50, 50, we get off the launch pad. Yeah. If we can get off the launch pad and we don't blow up the launch pad, that's a huge success. The fact that this thing got as far as it is in four minutes, and they got all that data. And they've got, when you see the scale of this factor, and I hope you all get to come

down here, and all Americans get to see this, because for me, and being friends with Elon for as long as I have, and to watch him go from the idea of this, and he showed me, I went with Elon to see the Hawthoron factory when he was considering renting it. And from that moment to now, to, to see the suffering that he went through personally to do this and the team, the amount of suffering to get to this point has been so tremendous. But when you go to the gig of factory in Texas, when you see what's happening here at Starbase, it should let you know that this is still the greatest country in the world with the greatest Entrepreneurs and and he is truly the greatest entrepreneur of our lifetime. And I'm not just saying that because he's my bestie I'm saying because it's objectively true and when you see headlines in the press

Look at what has been accomplished. Look at the Teslas on the road. Look at what happened with this rocket ship and judge the man by what has been produced to date and understanding he's going to keep going. And the team he hasn't inspired is relentless. I spoke. I sat there on the deck and hour or two after all this went down. And I just ate some chips and salsa with a half dozen of the people who were in mission control. They love the podcast. They listen to every episode of All In. I kid you're not. And they said, will you talk about this on All In? I said, well, we talk about this on All In. Thank you for what you've done for humanity. This is the most inspiring thing I've experienced. But we love you guys. We love you guys, SpaceX. Charge ahead, be relentless as you've been, and know that despite these absolutely insignificant headlines,

what you're doing is so meaningful to every American and every human on this planet, don't stop. Go faster, go harder, be more relentless, we're all sharing and we're in all of you. This is one topic we can all agree on. This is something that can galvanize America. This should be in the moment. We are leading the world again.

Yes. We're leading the world in the space race again. We're gonna be on the moon, we're gonna be on Mars. What about Uranus? No, you know? Freeberg keeps asking. I'm gonna turn to give me a hug. I love you brother. Thanks for coming on Give me a hug over here. Thanks for coming on

Bye guys. Thanks for coming on. See you guys. See you Gavin. Bye Antonio. That was great. I'm surprised I beat Jamal to the punch there. Yeah. Oh no. We were all cute. Jamal was having a moment. He was awake daydreaming about the future and not thinking about the line. I was taking the number of shares of SpaceX. I know in multiplying it by a billion trillion. Billion trillion dollars. Yeah, the rest of us are thinking about humanity, America, inspiring people, and Shabbat's got his like little calculator out. I'm gonna have like a babushka playing this. A play with it playing this. Like, a play with it playing this. I'm gonna play it out right now. Right?

I'm gonna roll in the moment, making it about you. Oh my god. Oh my god. Oh my god. Oh my god. Oh my god. Oh my god. Oh my god.

Oh my god. Oh my god. Oh my god. Oh my god. Oh my god. Oh my god. Oh my god. Oh my god.

Oh my god. Oh my god. Oh my crazy. WS Ice Queen of Kenwa. I'm going Berlin. I did have a business question about how the Starship impacts Starlink. Very simple. There is a graphic online you can find on the SpaceX YouTube channel. And they show the Starship. And it literally looks like a goddamn pes dispenser shooting out the next version of Starlink. And these are, you know, without,

I don't wanna speak about any specifics, but you can watch it spit them out. You can put out more and they're obviously gonna be more powerful. And if you have seen the size of the satellite, I have Starlink at both houses, the ski house, I'm main house as a backup. It's getting scary how good it is. And if you look at the size of them, and I, again,

I don't want to speak about any future products. It's not my place. But if you see the size getting smaller, there's one or two things that we all know about technology. Cheaper, faster, better, smaller. And just so I would just say if you're a fan of Starlink, just keep those words in mind. Yeah. It's going to be pretty amazing what Starlink's going to be able to do. Yeah, I thought that, maybe I read this somewhere that starship can carry 600 plus satellites, whereas the previous top of line rock at the Falcon 9 could only carry, was it like 50 or something or maybe less?

Yeah, I think it'll be a little less. Yeah, there's like 30, 40, so. So you're talking about 20 times the number of satellites can go up. And at a lower expense. Yeah, and I guess SpaceX has gotten permission from the FCC to put up about 12,000 Starlink satellites. So you could do that with, I guess, just

20, you know, 20 missions. The big disruption is going to happen by the end of 2026 because this next generation set of licenses, spectral licenses that the FCC sold came with a condition that you had to launch satellite capacity by the end of 2026, I think, otherwise you lose it. Or you have to do your first launch, I think, by the end of 20. Any of the point is that the only company that actually has the capability to build and to launch is SpaceX. So they have a complete monopoly, and because they're advancing their own solution, it puts everybody else behind the eight ball. So not only will they probably offer the best global internet connectivity at every single

natural point in the world that you could be, which is going to be a really big leap. They're going to do it Jason. As you said, at a throughput that's going to surprise people. And it's also going to render every other existing provider in a really difficult situation who's like, you know, what is their alternative? You can't launch with ULA because they're inconsistent. You can't launch with Blue Origin because they're inconsistent. You can't launch with the Europeans in general because they're inconsistent.

SpaceX is the only solution, but then SpaceX is just going to manage themselves. And there's nothing illegal about that. So you're going to be left with a bunch of these existing telecommunications companies in a really difficult spot in the next couple of years. So it's going to be really dynamic space, I think. Very much worth paying attention to. Elon sends his regards to the all-in community. He's taking a nap. Man, has not slept in the last couple of days. He's taking a while to serve a nap right now. So hopefully, we'll have him on in a future episode very quickly. Where are you taping from, Jake? Hell, just curious. Where are you taping from

there? I met Starbase and there are little tiny homes and he lent us one to stay in here. Yeah, it's just inspiring to be here. It's been a great experience. It's just inspiring to be here. It's been a great experience. I've been here a couple of times, and the scale of the factory, the ships, and just over the less, like they said, the less, I've been here a couple of times, maybe three or four years ago. It really is growing exponentially, and the other really positive thing is people are driving, again, back to the enthusiasm in the public.

And what you don't see me reading the press, which I think was really a two point of the sex, I met a guy who gave me a ride in his golf court. I was late to a meeting, the guy says, hey, are you going somewhere? And I said, yeah, because I was literally running on the street trying to catch a flight. And the guy drives me in his golf court.

And I say, hey, he says, hey, you hear for the launch. I said, yeah, I'm here for the lunch. He says, so am I. Can I ask you, do you work for SpaceX? He says, no, I'm just a fan of Elon. I'm a fan of SpaceX. And I said, can I ask you a drove from his eye, drove 19 hours to somewhere in Texas, Houston or something.

He drove 19 hours to come here, to spend the week to see the launch. And the crowds here have gotten bigger and bigger. And there's hundreds of people, I think it's called San Padre Island over here with a little beach community, kind of like a Las Vegas on the beach or arena or in New Orleans. And they're just lined up there with cameras. These are Americans.

Just Americans in RVs, in cars, setting up cameras to see history happen. And it really is truly inspiring. These are just salt to the earth. Normal folk. This isn't the media. This isn't like half-loan people or necessarily. They're just Americans who are inspired. And then that's, I think, what all entrepreneurs who hear these stories about what's going on down here

You'll overestimate what you can do in a year. You're gonna underestimate what you can do in ten and I think that's you know We all know Elon pretty well here and have watched this journey They're cooking with oil they're moving fast and the iteration process is extraordinary And they're making everything here and And it's Americans making everything. The tiles are, remember, being here three years ago, and Elon and I, two in the morning, were walking through the factory while they were working 24 hours a day,

trying to figure out the tiles on Starship to get it back in. And they were making the tiles themselves and just trying to figure that form. That's the level of detail that's occurring here. And as Gavin said, there's a thousand different things changing on each iteration of this. So more great stuff to come, I believe. Yeah. It's been another episode of Phil Helmuth's Ventures' Relationship with Elon. Thanks

everybody for tuning in. Yeah, exactly. No, I mean, what am I supposed to do? You know, like, I'm sorry that my friend, you know, started a rocket ship company. I don't want to apologize for it. You guys doing great stuff in the world as well. So, do we want to talk about AI? Do we want to go to this Tiger marking down their book? Where would you like to go, gentlemen?

We can talk about the Fox settlement with Dominion. That was something you and I talked about last week, Zach, I'd love to get your opinion on that. They paid $787 million in this settlement for defamation. It didn't go to trial. You were hoping it would go to trial. And this is an extraordinarily large settlement. So, yeah. But what are your thoughts on this? You wanted to see this go to the man and go to the Supreme Court and maybe see the laws in the United States change eventually? Catch us up on your reaction to this enormous fine. Yeah, yeah, it's a big speeding ticket. Yeah

Yeah, well, it's funny you you called a speeding ticket because when I saw this or reminded me of a scene at the beginning of apocalypse now Where Martin Sheen says that charging a man with murder in this place is like handing out speeding tickets at the Indianapolis 500. I mean, the analogy here is that the media is so dishonest whether it's CNN or MSNBC or the New York Times. I mean, they're constantly inaccurate or whatever. And so, it's still defending Fox. So for this one network to get a fine of like 800 million, it's like pretty, pretty incredible. I mean, they should be handing out a lot more of these in my view, not just to Fox. But yeah, look, I would like to see to that end, I would like to see the standard in

New York Times versus Sullivan revised by the Supreme Court. The standard is actual malice. So you have to prove not just that the press told a lie, but that there was malice behind it. And that's what this trial would have been about. And Fox, so what should it change to? Yeah. I think what would be a better standard in your mind? I think that if the media makes a mistake, they should have to correct it. And I would say the correction needs to be at the same level that they publicize the original story. So if they make a mistake, if it's untruthful

and it damages someone's reputation, and they refuse to post a correction, then I think they should be liable. That seems fair to me. If you were to put something on page A1, if you were to give it five minutes at the start of a show on whether it's Rachel Maddo or Tucker, whoever you were to give it five minutes at the start of a show on whether it's Rachel Maddo or Tucker, whoever makes the mistake, it can be anybody.

If they made the mistake in the first five minutes top of the show, they don't get to bury it on the website, they don't get to bury it on page seven. They got to say it up front. Hey, listen, we made a mistake. Correct. Here's the mistake. Correct. I think it's reasonable.

Corrections should get same. Well, the list is the original story. And by the way, if they correct it, that would be like a safe harbor. But if they refuse and they publish a lie and it damages somebody, then they should be liable for that. I think there should also be somebody who will do that. That's what I think. But yeah, I'm going to agree with that because there is the trick in journalism to bury

the correction. And there's another trick that I think needs to be looked at. It's a little more nuanced, which is somebody makes a mistake where an accusation in a publication. And then the next publication says, oh, the New York Times, Fox News, CNN said this, but they don't check it themselves. So they're using another publication as like a proxy to kind of give them some level of protection. I think they should have to on a first hand basis. Right. Now that's the game they play. You're right. So they start with a super shady source. Yeah. That, you know, it just attributes it to some sort

of anonymous source. Then the second most shady publication quotes that one and the third most shady quotes that and then it goes through the whole food chain. Yeah. So you're right. Reposting something in the echo chamber because other publications are doing it. You're right. That should not be protected. They should have to do their own sourcing, basically.

Yeah. Or just some base level of fact checking. And now if you called it Fox opinion, it's slightly different than calling it Fox news. So maybe the part of this is branding. Chimath or Freeberg Germany thoughts on this just in general Fox, I think has only four billion of cash so they just spent 20 some odd percent of it paying this off and if I were a shareholder with the question I would ask is did we actually make enough money to justify having to pay almost 800 million dollars of our cash balance?

The answer is probably no. And this is the first of a bunch of lawsuits that they have. The next one, which is I think is like smartomatic, which is another voting machine company, that's an even bigger lawsuit actually, that's a two and a half billion dollar lawsuit. And so it's, could it be the same outcome and another settlement? And so now all of a sudden you would deplete half their cash, all for a lie to do what? At some point some smart business governance needs to kick in over at Fox and they need to realize that this stuff just doesn't make economic sense. Maybe they thought it made political and ratings sense, but you can't justify that when

it costs two billion dollars. There is a concept here, I think, sex that is particularly interesting in Finland. When you get a speeding ticket, speeding tickets, your speeding ticket is proportional to your net worth. And so these NHL players who like to speed a Nokia executive, it was given the equivalent, and this is a bit excessive, of $100,000, $1,000 fine for going 45 into 30 zone on its motorcycle. And an NHL player got a $39,000 fine two years earlier. I think that this is part of the problem is sometimes fines don't match the crime end or the they're not proportional enough for the person to feel them. And so then we kind of conjo that's their speeding tickets. One very rich person said to me

And so then we kind of conjo, that's their speeding tickets. One very rich person said to me, you know, when they would, they I'd watch them parking, you know, incredibly illegally in a small town. And I said, you're going to get a pretty serious ticket. That's a pretty nor we spot to be parking. And they said, oh, you mean the VIP parking charge? And I was like, yeah, that's kind of sucks, but okay. But there might be some concept here of a proportional fine. And I think the EU is starting to work on that as well, because, you know, big tech was ignoring.

This is going to embolden a lot of people to take matters into their own hands and sue some of these media companies if the lie is egregious enough, and it negatively impacts them enough. I think it would embolden a lot of folks. So, SACs is right that up until now most folks haven't done anything about this, but if you feel like the media has really wronged you in a meaningful way, there's probably also now a lot of private equity organizations that

would do the lawsuit finance or hedge funds that would do the lawsuit finance or hedge funds, I would do the lawsuit finance. And so now you're like you're free rolling it, right? So you get one of these folks to pay it. They get 50% of the gains. You get 25% the lawyers get 25% and you go and you litigate. I'm sure that you'll see more or not less because this fine is really big. And again, we don't know the end of all of these 2020

election hoax shenanigans because this is the first not the last of these. I do think it's a really big number. I mean, I did want the case to go to all these courts so they could revise me or times worse the Sullivan. But I do wonder about the size of the settlement here. It seems extraordinary. They paid it.

There was an interest. It's a settlement. Yeah, they voluntarily agreed to do it. Yeah, absolutely. So, so in any event, look, I, I hope, Tremoth is right that this actually incentivizes more actions against media companies because I think their feet need to be held to the fire, and they need to do a better job publishing the truth. There was an interesting thread better job publishing the truth. There was an interesting thread by a Twitter poster called Canacoa. I don't know if you guys saw this. Where he posted an hour of footage by Democrats and Democratic groups and more Democrat leading political science experts questioning whether voting machines could be hacked. Basically, this idea whether voting machines could be hacked. Basically, this idea that voting machines could be hacked is not an allegation that is unique

to Fox. So, apparently, there's evidence that Fox knew it was bogus, so they definitely should not have run with it. But I do wonder, hey, why should another people be liable for this too? Well, I mean, the question is, I think those internal text messages between the hosts who knowingly knew it was false and then were doing it. I think that's why they took that settlement because 800 million or whatever. So it's a lot less than 1.4 or 1.5. And so there's speculation that maybe they got some bad discovery. They got some discovery problems. but I'm just saying that problem soon these allegations about electronic voting machines being

hackable or rigged this seems like an allegation that's been made well that's actually interesting not just in 2020 but it's been made multiple times by whichever side loses yes and so I would wonder why more parties aren't liable for this by the way. I never bought into those allegations I said so at the time. I thought they were bogus. I thought the whole Sydney pal thing, the release of crack in or whatever was ridiculous. So I don't feel too bad for Fox or anything like that. But it seems to me like I'm saying, they're not the only ones speeding here. There's a lot of people who need to get speeding tickets.

Yeah, there is a roadmap for the press to learn from this and to get better, right? Like to maybe take to heart that maybe the public now is looking at them and assuming that the trust in media is at an all time low. Alex Jones got $1,000,000,000. Right. It's a judgment. Judgment. Yeah.

The Fox thing is a settlement, right? He got a judgment of over a billion dollars, right? It's a judgment. Judgment, judgment. The Fox things a settlement. Right. He got a judgment of over a billion from multiple courts. Yeah. So he said a bunch of stuff that was in court provable to be false and then he kind of restated it and he got this massive fine. I think there's an interesting question here on how far this goes with respected, you know, maybe it invites the lawsuit. It's like you guys say where there's things that are more on the line. And then we really start to have kind of a tough set of conversations that maybe there are things that are factually debatable, arguable, opinionated, where they were true at a certain point.

And then you didn't really have evidence to disprove it. What are you allowed to say, are you only allowed to say things that you've proven, or things that haven't been disproven? And that becomes a pretty tough set of conversations. And what I think might be interesting from here, if so much of media over time gets replaced by chat and AI aggregating lots of different information,

synthesizing that and making representations back to us, and that becomes our primary source of call it news or quote media in the future. What happens when those models or the synthesis of data or the source of the data leads to a statement that has a similar sort of descent around whether or not it's true or not. And that you really end up kind of ending up in a pretty cloudy environment. You know, by starting this process. Yeah. I think as a very insightful and we'll get to A&M in a minute. I just coming, as it, coming from a journalist and background myself and then becoming a commentator, there really needs

to be three or four very simple things that the media needs to do. Number one, more fact-checking. And number two, less anonymous sources. They were like too much anonymous sources. And then there needs to be very clear delineation between what is a fact and what is an opinion. And the public is trying to sort this out. Is it Fox News is an opinion? And what you're saying is this an opinion or is this a fact? And you do journalism or did you just have an opinion? Is Rachel Maddo an opinion or did she actually have a journalist check these facts? And I think this is where self-policing and maybe rebuilding their rebuilding trust is on the media. It is now the news and the media's job to rebuild trust. And if not, they're going to get more fines.

But let's get into, I think some of the stuff we're seeing with AI, we had talked on this show before, many times, about the corpus of data under which these models are being built. A Reddit announced plans to start charging companies that use its data training and models. The co-founders Steve Huffman who came back after Condor Noss, Nass, had bought Reddit and then sold her back to the founders. Paradoxically, I believe Sam Altman has a major investment in Reddit. He said, more than any other place on the internet, Reddit is a home for

authentic conversations. There's a lot of stuff on the site that you'd only ever say in therapy, AA or never at all. A lot of people use pseudonyms, obviously. And the Reddit Corpus of Data is incredibly valuable. But we don't need to give all that value to some of the largest companies in the world for free. Crawling Reddit, generating revenue and not to some of the largest companies in the world for free, crawling Reddit, generating revenue and not returning any of the value to our users is something we have a problem with. It's a good time for us to tighten things up.

Your thoughts, Shamaaf, on what we talked about two different episodes. Maybe we'll play a clip in here and if you want to in post. It's going to be the large data sets. Quora, Yelp, the App Store reviews, Amazon's reviews. So there are large corpses of data that you would need. Like Craigslist has famously never allowed anybody to scrape Craigslist. The amount of data inside Craigslist, as but one example of a data set, would be extraordinary to build Chatchy PT on.

Chatchy PT is not allowed to, because as you brought up robots.txt last week, there's going to need to be an AI.txt. Are you allowed to use my dataset and AI and how will I be compensated for it? Will the rights to the data, will Google just state a Cora, hey, we'll give you a billion dollars a year for this dataset if you don't get a dandy, but he else. They should.

Jamal, those were our previous discussions that we just played. What do you think? It's so incredible. We are witnessing such an important moment for Silicon Valley, but frankly, how the world works. And it's just everything is changing. That's what I'm just in awe about.

That, you know, we talked about this and we were basically spitballing something two or three months ago and not but 60 or 90 days later these things come to pass. We talk about something in one week and then 14 days later, it's completely upended, like how impressed SACs was about plugins and then plugins were rendered useless and somewhat impotent two weeks later by auto GPTs. It's just so profound. I think what's going on? So Google today announced that they're going to merge two organizations that I thought were so orthogonal to each other, disparate, brain and deep mind.

The culture just seems so totally different, but now they're merging those two things together, something that I thought would never happen. They did it. So all these competitive pressures are so real. I was in LA for the breakthrough prize. I was flying home with somebody on Saturday. I won't say who it is, but they are right at the bleeding edge of a lot of this AI stuff. And they let go of third of their company,

replaced it with an agent within six weeks of training it. So how is this not gonna affect everybody else? I guess is maybe the bigger question. And then I go back to what I said last week, which is that we've talked about a lot of the positive things and I think it's important to make sure that people understand that there are a bunch of non-trivial negative things.

And I think I shared one on Twitter, which was around this company that used an AI model to build a library of 40,000 toxic compounds that could kill all kinds of numbers of humans. So there's all kinds of really, really tough things going on right now that I think, to me, means it's the moment where I have the least sense of how to do my job. And so I've tried to kind of like put a pin in everything and just go back to learning mode. It's a bit humbling is what you're saying. Like it's incredibly humbling.

The entire rule book, even for us as capital allocators company formation, it has you, it has you, Chema, for even as it has to do this. As a CEO, I'm like, should I be using models to do parts of the workflow inside of my business, inside the portfolio companies that were invested in? Am I supposed to go into the board meeting now on Monday and say, hey, XYZ person just did one, two, and three, and cut off X by a third. Do I demand the CEO do that?

Do I force change if they don't do it? Do I say, so I don't, I don't, I don't exactly know what to do. The carousel is spinning increasingly faster. And we're all on it. I'll just say a general point, which I kind of made at this event today. It feels like the pace of change is so high that you're kind of in a dust storm. You don't really know where you're going to end up.

It's very hard to sit as an investor right now and say, I'm going to pick these things because two weeks later, you just don't know whether that path even exists anymore because the dust storm washes it away, you know, blows it away. And I think that as a result, there would be a lot of money lost by investors, by companies building in this space. Net, net, the index for investing in like dot com companies,

the majority, a large amount of money was lost during that era. But from that era also emerged a handful of winners. And those winners ended up creating extraordinary value. I think we're at a point in time right now where we could see 10 times the value generated in this phase of technology advancement than we saw during the internet and the advancement of the internet and the advancement

of the internet. And if that is true, I think you'll end up seeing, certainly the same thing happen, which is the index will lose money, but the few winners will accrue such extraordinary gains. The problem is you can't deterministically pick those winners today because of the dust storm problem. You just don't know the path.

So if you were to meet Jeff Bezos versus some CEO of some .com selling pet stuff back in 1995 to 1997, 94 to 97, would you have recognized Jeff Bezos was going to stand out? Would you have recognized Larry and Sergey were going to stand out? Would you have recognized Bill Gates was going to stand out or Zuck? At the end of the day, this is harder than it has ever been in terms of predicting a technology cycle. But what we still know to be true is that the capital will be allocated within a company, the operations will be run, managed, and driven, and led by an individual or a set of individuals. And that's effectively what I think a lot of investing in the cycle is going to come down to. We're all going to sit here and pontificate and intellectually masturbate ourselves to some, you know, genius, you know, path that we think is going to evolve. And at the end of the day,

most of it won't turn out to be true and that path won't be real because this is such a dynamical system right now. There are so many feedback loops. One thing makes one step change and it changes every other step. But what we still know is that great leaders can lead. And especially coming out of this Elon discussion and seeing the extraordinary achievements he's delivered particularly today. I think that's maybe what a lot of early stage venture is gonna shift to an AI.

It's really finding great people. And I'll tell you one thing for sure. And I was kind of commenting on this earlier today was I really think a lot of series C and later companies and I know we're going to talk about this implosion discussion later. So many of those companies have a valuation that's less than their preference stack and as a result those founders that work there and those employees that are there are getting their equity wiped out. They'll have to get me a fairer the structure. Can you just explain what that means

technically to the audience? So when you raise money into a startup, the investor is that give you that money, that invests that money. It's effectively alone. You owe them that money back first before your shares get paid out in the future. So if the company ends up being worth less

than the money that they've invested, they get the money first. And ultimately, if the company goes public or gets sold, they can convert their what are called preferred shares into common shares and participate. So even though you only quote sold, 20% of your company, for let's say $200 million, that $200 million actually has to get paid first. So now you've raised this $200 million.

The investors, the company is now reprised because the market has come down by 80%. And investors are saying, hey, your company is now worth $175 million. Your company is now worth less than what you owe the preferred investors. And if it's worth less than what you owe, which I think is the case for over 70 or 80% of series-seeing layer companies, you know, we can cut it. Yeah, and this, but this number comes from what I shared a few months ago, which is that 70% of publicly-traded companies that went public in the last three years are trading below the cash that they've raised. So if you translate that on a one-to-one basis to the private market, you know, and these by the way were the best companies actually got public. So in the

private market, you've got to assume that something in that late stage market is on the order of 70-80% is worth less than their preference stack. So a lot of those employees are going to run. Those founders don't want to go work for the VCs when they get recapped and get offered a four percent way. Where are they going to go? Because it looks like they're going to start AI companies. And I think that's fantastic. And I think that's what's really shifting it right now. That's kind of a big dynamic. Is a lot of these, I'm calling them zombie gorns,

are going to see this kind of mass exodus of talent. And a lot of the investors that don't know how to price stuff and don't want to deal with recaps in the late stage are diverting their attention to seed and A and early stuff. And so there's both a rush of talent and a rush of capital to this very early stage. And so we'll create this massively bubble-lific index of AI stuff. But some number of these things with some great leaders

will emerge and will accordinary value across many industries. I really agree with a lot of what you're saying. The thing to keep in mind is that the problem with the use of auto-GPTs as an example is that the order of magnitude of capital that you need has now just gone down. Yeah. Yeah. Instead of a $10 million series A's into crazy, very bubble-ish ideas and NFTs and all this other stuff. That's idiotic today because a two or three person company can now do the work of 20 to

30 people and the amount of capital that they need is really their salaries plus the cost of renting some GPUs on your favorite pick your cloud. And so all of a sudden, you can get huge amounts of progress in weeks and months with hundreds of thousands or low millions of dollars. So if you've raised all of a sudden a $5 billion fund because you were trying to do late-stage deals, and now all of a sudden said, well, wait, we'll just pivot to early stage. But what are you going to do? Find the next 30-person company that's not going to work because you have to know how to

write $500,000 to $1,000 checks with two or three people and really help them and really understand their technical ability to execute, right? But then it also quickly becomes a thing where maybe you're better off just doing 500 of these two and three person teams. We tried this experiment seven years ago, this thing called Capital as a Service, where we were doing this automated investing. I don't know if you guys remember this, but it was like some machine learning that we did on all of our portfolio companies. And all somebody had to do was fill out a form and send us some metrics and we would have a machined decision, right? So humans would not be allowed to make the investment decision.

The problem that we ran into was there was a lot of great companies all around the world, but the administrative burden of supporting 500 companies was unbelievably large and complicated. Oh, you have a company in Indonesia. Well, there's another company in South Korea, and here's a company in, you know, they're raising a new round. They have to get board approval. They got to do this. Signatures. I mean, it's hard to scale. Yeah, so the VC, which is a software light people have a artisanal business, all of a sudden becomes misfactured. Right? So you actually need to be highly automated

and use software yourself in order to put 503% teams on the field. So this is what I mean by, I think Freeberg's use of the term dust storm is a really good one. It's extremely, extremely confusing what to do. And if you have large amounts of money, that may actually now, what used to be a real differentiator and a key to success may actually become an impediment because you are forced

to do business in a classical way that has changed, frankly, in the last 90 days. What do you think, Sacks? What's the question? Because we're touching a lot of different things here. this in a classical way that has changed, frankly, in the last 90 days. What do you think, Sacks? What's the question? Because we're touching a lot of different things here. Do you feel like this is a dust storm and it's murky and it's just hard to place bets as a capital allocator? Because something comes out the next day, 48 hours later, the next week, that takes the

previous idea and wipes it out and then how do you scale and be capital efficient? Well, we're at the early stages of a huge new wave and I think that creates a lot of opportunity. So yeah, you've got to basically separate what's really interesting from the fool's gold. There's definitely going to be a lot of that. But at least there's a reason now to believe that, say, dozens of unicorns could be created in the next couple of years. So before we were getting along in the tooth on some of these tech cycles, I mean, clouds, social mobile, I mean, there was a reason to believe that those earlier waves had sort

of played out that the big winners had already been determined, and maybe there wouldn't be too many more big winners in those spaces. But now we have a whole new catalyst for founders to do all sorts of new things. And so I tend to think that's super exciting, you know, we're in the early stages. And I do think there will be dozens of new unicorns minted in various aspects of AI. It could be in AI infrastructure. Whether you're seeing now, there's a lot of funding that's gone into vector databases or platforms or creating agents. Or it could be in AI co-pilots, basically that tackle various

professional categories and create a co-pilot for coders or a co-pilot for doctors or lawyers or architects. I think there's going to be potentially multiple unicorns created in those categories. I think there's going to be SaaS software products that were just good before but now will actually be great because the incorporation of APIs from AI Foundation models will just turbocharge the capabilities. And so there's a whole bunch of SaaS products that I think become newly interesting and better.

They go from being vitamins to painkillers. So we're looking at all those categories and I think we'll end up making some bets. But there's also going to be a lot of companies that are flashes in the pan or get undermined. There'll be SaaS companies that actually become less attractive because of disruption from AI. But look, I think all of this, this Milstrom is great for an investor. I mean, if you're going to spray and pray, it's not good.

You've got to be selective about where you take your shots, but I think this is the most exciting environment we've been in in a number of years. I mean, it makes me want to go to work every day and see the new stuff. It's so fun to see that, SACS, because I literally am looking for an office space in San Mateo to start doing the incubator in person again. And on Monday, I'm having 60 companies come to San Francisco and will be at my attorney's office and we're having like a a founder university with just all these new startups that we invested into just hang out for a day. The enthusiasm right now is amazing and what's really unique is the

developers who had three out of seven companies they interviewed with offer them 150 or 250K packages RSUs whatever. Now there's no offer from Facebook, there's no Apple, there's no Twitter, there's no Google or Microsoft offer coming in to be the backstop against starting a company. So what are they doing? They're saying, you know what? I got two friends who got laid off, I got one friend who's halfway out the door, let's just start something. Let's just start something. Who can give me 100K? Who can give me 500K? And it's so invigorating to see the talented people, not people who've learned how to

hack a pitch that together and tell a story, but people who are actually coding and making MVPs. It's truly exhilarating right now. The amount of two and three person startups I'm seeing. Yeah. And so while you have this, and it's an incredible, I've never seen this amount of destruction

and creation occurring simultaneously. I love this, it's on because concept, you have one half of your portfolio coming apart at the seams, layoffs, reducing their targets. While people are coming in the door with products that are absolutely awe-inspiring, just give one example. It had a company come out of our founder university. It gave them $25,000 to incorporate a developer and his brother who's a screenplay writer. They're taking screenplay writing software and sacks, so you'll appreciate this, having produced two amazing movies. Thank you for

smoking and the Dolly film is called Dolly Land Dolly land yeah coming out in two months coming out two months. Congratulations to Emmy award winning Oscar winning producer. I was gonna win an Oscar this time. These you know the screenplay writing tools that have existed. You're like what were processors with formatting. What they're doing is they're saying, hey, write some dialogue. And then you can have dialogue and say, hey, make it a little snappier, make it a little Tarantino-ish, make it a little more, you know, sorkin-ish, and then make a storyboard with, you know, stable diffusion. And I was like, well, this is the genius idea. I mean, it's unbelievable. Of course,

I'll give you $25,000 for your incorporation. And then they're coming to the exonerating and giving another 100K. And every single piece of software. Well, that company in success ever raised $25 or $30 million, do you think? No, I think there'll be 12 people. I think there'll be 12 people. I'll give them, but there's 25,000,

200K and then a million. Our industry raises $100 billion a year on the premise that each company before they become a unicorn will absorb between $500 and a billion. Yeah. I'm going to own 10 to 20% of the company for low millions. And we'll say mid-Journey is 12 people and no, it's totally bootstrapped. Like I guess what I'm saying is because in the world of AI, so much work is done for you

for free, this is why I'm asking maybe we in the world of AI, so much work is done for you for free. This is why I'm asking, maybe we will have to change how we do business. On the Hollywood example, there's about to be a writer's guild strike. And they may want to think twice about that because this is not the time where you want to be encouraging the industry to find alternatives to writers. You want to get back in the office and you want to say, Hey, can I, is there any other work I can do this weekend boss?

Did you see the news about Buzzfeed today? They had one of Pulitzer. They just shut down Buzzfeed news. The entire news division gone. Another 15% gone. The layoffs and then there was a report this week that Zuckerberg is doing his third round of layoffs, another 4,000 people. That puts him at 24,000 with a hiring freeze.

So the way I describe the current funding environment is it's a tale of two cities. It's the best of times, it's the worst of times. If you're a hot AI startup that's able to tap into the zeitgeist that's doing something that's perceived as cutting edge or relevant, there's a strong doing something that's perceived as cutting edge or relevant. There's a strong Y now and you're early, you know, you're early stage. You're able to raise money for that. This bigot has turned back on. There's a lot of funding for those types of early stage startups. But if you're a series C stage startup, you're a late stage startup with a, it's called a pre-AI model. This bigot has just turned off completely. I mean, let's look at that chart from French base where the amount of Ceresi funding has gone from something like 10 billion a quarter last year to like zero. I mean, this chart will partly...

I thought this was an era in the chart. Look at this chart, everybody. It's Ceresi funding to U.S. companies by quarter. There is just no growth stage funding. It's just completely dried up. I mean, look at that. I mean, it got cut in a half and then it got cut in half again and then it just flatlined. And so you see this, you're thesis, let me show you this, actually,

you're thesis here that people aren't trying to raise money and they're just busy cutting their companies down to a smaller team size and they'll come back out in the second half of the year or that anybody with that amount of dry powder is out of the game now. Yeah, I think that we're in this awkward stage where the companies who raise money and call it 2020 and 2021, all those valuations are obsolete and you you've had a lot of late stage players leave the game, or they're in the penalty box, they're in time out. I mean, look at Tiger, for example,

the single most active funder at late stage is trying to figure out how much to mark down his portfolio. So I just think that a lot of the funding has dried up. There's this idea that there's tons of dry powder singing out there, I think, is a myth. Or maybe it's there, but there's no willingness to deploy it. The valuations are all out of whack. And VCs generally would rather lead around in a new startup with a fresh cap table, then

in a cap table, they got a restructure because no one wants to do restructure. We talked about a year ago. It was when we talked about a year ago, Chimath. I asked you a point blank, would you, if they cut the valuation and, you know, they redid everything and said, hey, listen, we understand this is reality, would you get involved and cut it? Check it.

You're like, I don't want to deal with that kind of, you know, that kind of, that kind of, too hard bucket, too hard bucket for you. Yeah. And so now, once again, a year, six months, a year after we talk about this, it has now manifested. This is metastimes into, no, it hasn't even started. I think we are, it about this, it has now manifested. This is metastimes into it.

It hasn't even started. I think we are still. It's the, it started. I think we're still being really precious. Like the Tiger thing was very important because they are in many ways at the front of the line in terms of the number of companies they've touched the amount of capital they've written.

And because they're in the middle of a very large fundraise, their need to mark the market quite accurately so that their existing LPs know what they're signing up for in this next fund. So they're the ones that have the most incentive to move the marks, but it still leaves an entire industry of folks that don't necessarily need to do that because they have, whether it's dry powder, that dry powder is real or not, the point is that there's ripowder, that ripowder is real or not, the point is that there's a lot of money that hasn't been deployed. And so again, I've asked this question before, what is their incentive to really mark their

book down 50 percent? They don't have an incentive. Why would they do that? They would rather let it decay down naturally. I'll give you an example of this. Or do converts that keep it alive, that basically allow them to delay. Yeah, anybody, but even the convert market freeberg that was hot for about six months and then it just yeah, no, nobody's doing that stuff either, but I'll give you one example. There's a very good company that we are investors in along with every kind of big blue chip tier one Muckety Muck

organization. We did the A and they stacked on afterwards. And when we thought about what our valuation should be, we did something, we got to a number which was a third of what the mark was. And we're like, well, if we think the price is two thirds off, we should probably just sell it now. And we actually went and got some term sheets from some private equity firms to validate it. And what they, we was incredible, they both independently got to that same number. And so while the deal was closing, we went through the end of quarter, we moved the markdown and we pointed to that valuation and we said, look, this is what these two other very

well-known firms have said. This is what we've said. So this is what our new valuation is. And, you know, we're trying to sell it and we ended up selling it. But every other organization didn't touch their valuation, that valuation. The private equity folks, maybe you could explain to the audience why the private equity folks are such a good backstop in terms of valuation versus say venture capitalists. Well, I think that venture capitalists we tend to be glass half full.

And we are conditioned, especially if you do your job well, to be smart buyers of deep out of the money options. What does that mean? It's like when you meet an entrepreneur and you give them three or four million bucks or five hundred thousand dollars or whatever, at some nominal valuation, you're not trying to get your money back. You're trying to figure out whether he is a Zock or an Elon or Larry Page and all of a sudden you get 1,000 X

on your money back, right? So we are buying these deep out of the money options. Most of them don't hit, but when they do, they can just have these crazy statistical outlier outcomes. Yeah, meh. So we're trying to buy the future and we tend to be believers of what can go right. Private equity has refined a very powerful toolkit of putting two or three orders of

magnitude of the money we put into companies to work on the premise that the glass is actually half empty and what can go wrong and how do we mitigate that risk. And so they tend to be much more sober, I think, in my experience dealing with them in what is the true valuation of a business? What are the upsides of a business? What are the warts on a business? They really kind of see the truth, the ground truth much better than VCs do in general. Because they're closer to public markets and they flip these things every two or three years. They're margins are much thinner. They're trying to make one, two, five, one point six, sex, their money.

Two X is a huge outcome for them. Yes. So they have a much more sober version of reality. Much of this tiger stuff got released and I mean, they're funds underwater. Just like Masayoshi's fund is underwater. And it's going to be years of pain and suffering to get out from under this. And so again, I think Saks now that with tell of two cities, anybody else want to chime on this before we talk a little bit about. Well, for our friend of the pod, Brian, I'm strong.

Yeah. I've been I've been investing off balance sheet since 2018. And six months ago, we started to explore whether we should raise a fund. And I think it was like two weeks ago, we brought the senior partners in me and the five other guys that run our business. And we said, we're not gonna raise a fund.

And the biggest reason is this dynamic, which is that, you know, we have $1.00 a private assets. I don't actually know what they're really worth, but I have a responsibility to try to get as much of that capital out. And so I thought the best thing to do is just to take our time and try to figure it out. Because I have way more questions and answers right now.

And that's really the first time since I've moved to Silicon Valley where I've had that sensation. Is a sensation humility? I think it's like, I mean, I'm joking, but it is for somebody like you who has done deeply how placing bets deeply, deeply how I mean, I say it's a joke, but I mean it as like a point of self awareness for you because listen, you place some amazing bets, whether it's the Warriors or Facebook, or Bitcoin or whatever, or Slack or whatever. I don't know whether I should be writing $200 billion

checks or $200,000 checks. And I don't know whether I should be doing that sort of as an incubator actually, as an accelerator to what I'm doing, or actually just as a series A detached investor. So I don't know, I'm trying to take the time to figure it out. And my thought was, if I raise a fund right now, I could barely stand the idea of me putting

money to work right now of my own capital without any answers. But then the idea of like having a bunch of sovereign wall funds and folks that were ready to work with us. I don't know. I just, I just to not the right time, just to tell you my fundraising story. I'm publicly raising watch fund for I Get over 50 million dollars in just you know high net worth individuals, you know and family offices who are interested immediately close I don't know 26 27 28 of it and then I'm gonna go out on the road to meet with LPs and Silicon Valley bank blows up Nobody can take a meeting that month, right? And so now and Valley bank blows up. Nobody can take a meeting that month, right? And so now, thank the Lord, I said, I'm going to have a one year window to raise the fund. And I talked to some old school VCs, Fred Wilson, Bill Gurley, these people would take a year to raise

a fund. It used to be, or I'm sorry, in the height of this bubble, you tell me a sacs the quick issue closed one of the crafts funds, but I was hearing people saying they're closing funds within two or three months. I think we're back to it's a year on the road to close a fund. What would your experience, Saxons, and you're an all-starter? So I'm curious. I'm curious. The shortest to the reality. Yeah. I think it's just depends on your situation, to be honest. But I think the important thing for founders to know is just that the way that late-stage financing is dried up is very real.

I'll give you two data points just this week. So I got my first notification from a portfolio company. This is a company I invested in before craft. It's not a craft investment, but my personal investments, and they're doing a pay to play round. You know what that is? Where?

That means pain. Yeah. Yeah, so basically the way it works is they say they're going to raise 20 million dollars. Well, by the way, they said they went out to raise growth funding. We're unable to get a term sheet from anybody. And so no takers, no takers. And this is a good product. I mean, a lot of startups use this product. I think they're ARRs and the 20 something million, maybe 30-something million. It's not like doubling your year, it's growing like let's call it 50% year over year.

This is a company that should have been able to raise money. I don't understand why they weren't. Maybe because they're burning too much money. So instead of kind of cost the way they should, they're doing like a 20-million dollar pay-to-play round. And what that means is that everybody is an investor in the company. You either have to do your pro-rated share of the 20 million or you get diluted 10 to 1. If you had 10% of the company, you have to put in 2 million dollars or your 10% of the company is now 1%. No, it'd be more because you would look at, let's say, 50% of the companies owned by the investors and the other 50% common, just to take around numbers. Sure. Okay. If you own 10% of the companies owned by the investors and the other 50% common.

Just to take around numbers. Sure. If you own 10% of the company, that would actually be 20%. Of the preferred. Yes, the employees are not buying shares in this. 20% of the 20. So it's 4 million. So it's 4 million.

Yeah, exactly. So, 4 million, you have to own 1%. Right, right. So basically, it's almost like a capital call where you just have to pony up more money in order to preserve your ownership in the company. Punement. If it makes you feel better. It is punitive, but yeah.

Super punitive. I had one of those just happened to me as well. And I was just like, well put in the bare minimum because like the thing that it puts you in, it paints you in a corner where you're like, well, I've been with this thing for eight or nine years, is this the moment to basically lose all of that compounding or value or work that you put in or seen their team do? And it's just a really tough position. Right? So look, I'm not on the board. So I don't know what reasoning went into this, but what they should be sending out to all the shareholders is, look, here are all of our metrics, here's our burn.

Here's the steps we took to reduce our burn. I don't really like the idea of having to do essentially a capital call from your existing investors when you haven't reduced your own burn. I mean, why can't the company operate at break even if you're at 30 something million of an ARR, you should operate. You may not want to operate it break even, but you should be able to. But, Saks, this is what I mean.

I'll tell you after we stopped taping who it was that told me this about their company, but they were basically able to let go a third of their workforce by moving a bunch of work to models. And let me guess, the founders get to keep their shares or they get reupped in this whole,

Michigan. No, no, no, wait, hold on. Can I just finish the point? Yeah, please, so, of course, sorry. So, the point is like, if you can cut off X by a third, by using all of these new AI models and GPs and auto GPs, what are you as a board member or shareholder supposed to do?

And also, as a founder, don't you have to go there first before you start to ask people for more money? And why aren't people doing that first? Much more aggressively. And so this is what doesn't make any sense to me. That's exactly my point is what steps were taken to cut costs before you just went to

the investors to pony up more money. That's what I want to know. If they actually did that work, and this is like the last money they need, okay, then you know, I'll pony up my share. And like the last money they need, okay, then you know, I'll pony up my share. By the way, we need investors to eat. No, we don't. And we need investors to be much more aggressive in holding folks accountable because these

examples need to be better discussed. While the FXYZ company was able to do it, why aren't you able to do it? And if it's because we're not technically capable, that's maybe a plausible answer, but even that reason will go away in a few months, I suspect. But if it's that we just have such institutional rot, we're incapable of doing it. Well, then you might as well just not write the check because that company is going to get undercut by some new white sheet version of that business that doesn't have any of these impediments that you've been.

Management has told you a bunch of instruments. In a way, Chimoff and Sacks, management has told you they're incapable of running this business, this concern in a thoughtful way. I had this happen to us as well. The question I have for you, Sacks, is in these situations where this pay-to-play happens, you basically, everybody gets wiped out except those who play. But the founders and the management team always seem to get re-up and their whole because the new investor doesn't want the management team not incentivize. So

in these kind of situations, it's kind of like the management team gets to reboot the cap table and they don't get peanuts. I don't have those details yet. I remember I didn't lead around. I was just a angel investor in the company So I checked with one of the VC firms that led around and I'm like are you gonna do this? And they said probably not you know and so like the round might fail I mean they can make it as punitive as they want but if the shareholders don't believe that the company is fixed as problems They're not gonna pony up the money. Let's get free, Bergen. Yeah, I think one of the problems that a lot of folks are facing is it becomes less about the fundamental value of a business in a lot of these conversations, as you guys know,

and it's becoming a lot more about who will fund the next round if the company is still burning money. And so you're making a social market bet, not a bet on the team or the business or the value. It's that there's someone else that's gonna lead the next round. And this is fundamentally why it's called the greater fool.

That's called the greater fool thing. Look, I mean, historically, we wouldn't call him a fool if it's just about progress towards profitability. But right now, there's so much trepidation. It's almost like a self-fulfilling prophecy, that there's so much trepidation and doing late-stage rounds that no one wants to be the last guy in, because you're not sure if the next guy's going to be there to fund the last round to get the profitability. And that's why half of biotechs that are public are trading below cash, because historically the way biotech companies, which is a really good point, an example of this, they make progress to hit milestones.

And then the next round of capital comes in, they make progress to hit milestones, next round of capital comes in. And then eventually you get phase three approvals and you go sell the company or whatever you get profitable. And they almost always get acquired. And in the case of other technology companies, if the business has to do three or four things, it's got three or four milestones it has to hit. In your case, stocks, it might be that they got to get to 50 million ARR

and they got to get the certain cost function down in the business. And if they can do those two things and the business profitable, but it's going to take us around a 20, we'll get the first chunk down, and then another round of 30 to get the last chunk done. And no one knows if the next 30 is going to be there. And that's really where a lot of these market dynamics are falling apart, that there's historically been a model in the market of Hit Mile Stones, Next Round shows up,

Hit Mile Stones, Next Round shows up. And now no one knows if the next round will show up. So no one wants to fund this round, particularly where there's high burn, and it requires a lot of capital to make that bet. So the social, you know, the self-ful self fulfilling problem, the social market bet right now is, you know, it's self fulfilled and we're, you know, we're sitting here kind of spinning our thumbs wondering if the next guy's going to find it. Do you think that only 10 or 15% of companies have now properly reset value?

Like you said 70% of these unicorns are actually zombie corns. Yeah, that's why I think the number from, I don't want to, I don't know, tiger's book at all. But when I hear numbers like 20% for a fully invested mature book and invested during the peak of the cycle, it doesn't sound right that it's 20%.

It sounds like it should be a lot lower. I think that 20% by the way, you know, comes after like two other smaller right down. So they might be cumulatively. Yeah. So I don't want to talk about tiger. I don't want to talk about tiger. I think like sure. The statistic of 70% of these public companies trading below their cash, the cash that they've burnt that they've raised in their lifetime. And again, just for anyone that's an analyst at home trying to figure out how we get to that number, you look at the retained earnings on the balance sheet.

And so the cumulative retained earnings tells you, if it's negative, tells you how much money they've burnt over their lifetime. And that tells you effectively how much money has been invested. So when you look at the enterprise value, which is the market cap, minus the cash they have today, you get their enterprise value. If their enterprise value is less than their cumulative retained earnings, it means that they're currently worth less than the money they've spent. And that's a statistic that is a fact right now in public markets in technology gone public in the last three years. And then you compare that to private markets. And I don't think we've seen a 70% right down yet, or you know,

70% of these things being worth less than the cash. So it's still, yeah, I think you're right, Jamal. Jamal is probably another hammer to drop. Multiple hammers. Multiple hammers. Before we move on to a different topic, so I think one of the interesting differences in opinion in Silicon Valley is the way that founders and VCC, the nature of the relationship,

and I've been on both sides of this. I've been on the side of being a founder, and I've been on the side of being a VC. And what you'll see is that VCC is always talk about it as a partnership, but a lot of founders will talk about it as if the money is just a commodity. And frankly, when everything is up and to the right and everything is going great and you're in a bull market and you can just keep raising money. And definitely because there's always someone willing to lead the next round, then the money is a commodity. But when you're in a down market and all of a sudden there is no market, like you can't

raise your next round, all of a sudden it is a partnership because you've got to go to your investors and ask them to do something that they may not otherwise want to do. This was purely a transactional decision as opposed to a relationship. They might not want to fund your next round. You're asked them to say, no, actually believe in our long-term relationship. I think that this is a type of environment which you find out it is more of a partnership. It should have always been. It should have always been. It should have been.

It should have been. Look, I don't know what happened with that other company. And all of a sudden, I got a notification out of the blue. Well, I want to understand the thinking that went into that before, you know, I'm just going to basically do this. Well, this is where trust comes in, right? And like, I think in a zero interest rate environment, you know, there's no need for trust. You just this cash splashing around just grab whoever the latest person in town is who wants to drop a couple of bags.

You just take one of their bags and you'll know. The most important thing to me, like what we're making a partnership is for me to know that the founders have done everything in their power to reduce costs and put the company on the right trajectory before going out and basically issuing capital calls to the investors. I want to know they've done that work. All right, listen, Freiberg, I know you had to go. Take care, Sultan of Science. I'll just wrap up with the other boys here with one piece of breaking news. Stack Overflow says they will join the parade of data providers like Reddit and Twitter that will require permission and payment

to use their data sets. And Stack Overflow has a lot of answers to a lot of developer's questions in there. I was just curious to get your thoughts. SEC obviously sent a Wells notice. We talked about this before to Brian Armstrong of Coinbase. He said he's thinking about, or considering relocating out of the US if the regulatory clarity does not improve.

Crypto's dead in America. It is dead in America. Crypto's dead in America. I mean, now you had a chancellor, you had Gensler even blaming the banking crisis on crypto. So they've, the United States authorities have firmly pointed their guns at crypto. Is it scapegoat or was it a fuck around find out moment for crypto in your mind or a little bit of both? I don't know. I just think that they were probably the ones that were the most threatening to the establishment.

Okay. And they were the ones that in fairness to the regulators did push the boundaries more than any other sector of the startup economy. And yeah. So now they're paying the price for that. The bill has come due for them. Sacks. Is it a fuck around find out moment?

Is it protecting the American dollar somewhere in between? Or in competence on regulators part? The more I think about it, the more I think it's probably not a coincidence that you're seeing all these concerns about D dollarization at the same time they're cracking down on crypto. So look, there were a bunch of crypto companies that might have done shady things, but I think

we all agree that Coinbase was not one of them. Coinbase was the gold standard in terms of doing everything right. And they've just asked over and over again for a regulatory framework. They're just like, tell us how to operate and we'll do it. So I think Jamoth is right that they're effectively banning crypto in the United States. They're going to drive all these companies overseas, which is terrible for American innovation. I don't know exactly where blockchain and crypto are going to go from here, but I think that we should find that out in America. You know, we don't want that innovation going offshore.

You're bringing up a really good point too. It's just like Coinbase played by the rules, stood in line, tried to do the right things. It seems that every step along the way, right, everything from board composition to executive composition to how they tried to interact with the regulators, yet they were probably the furthest away from getting a license. The one that came the closest was the one that was the most fraudulent, which is after the ads. Fascinating.

How is that even possible? I mean, because he had skills in gaming the system. Yeah, he's splashing cashy, splashing cashy. Well, he he pronied up large amounts of money because it wasn't his money. So it was easy for him to make huge donations, but he knew how to play the game to quote SPF. He said, this is the dumb game we woke Westerners play. We say the right shibbles us so everyone likes us. That's the game he was playing, which is my whole concern about if we jump the gun on regulating AI too quickly, it'll turn into another, you know, woke game that everyone's going to play.

Here's the, here's how the world works. Regulate yourself, behave yourself, act in the interest of consumers, or get regulated or smashed. I think we've gone over this. We talked about it in fact last week, whether in the movie industry, crypto, AI, regulate yourself, behave properly, don't push the boundaries too far. You can bend the rules, but you don't want to break them. I think to regulate yourself, you use the MPA. I don't think that's the right example. I think if you're think to regulate yourself, you use the MPA. I don't think that's the right example.

I think if you're going to regulate yourself, look at the tobacco industry. They tried to regulate themselves, but what they did was just lie to maximize profit in an area that was much less benign than movies and content. Maybe you could have some lascivious content in a movie or a video game or an album, but that was a lot less harmful than smoking, which not just impacted the smoker, but it turned out the second-hand smoker as well, or the second-hand smoke. So it touched everybody, right? You could be in a restaurant, not smoke, and yet have years of your life taken. So I think that the self-regulation for areas that impact everybody, independent of whether you

participate in the system or not, is where you have to look for good examples, Jason. And I'm not sure there are many good examples of self-regulation in those kinds of systems. I mean, I like your workshopping in here. I mean, some restaurants would have a smoking section and an on-smoking section before there was regulation, right? And I think if crypto had just thought, had been more thoughtful about, hey, which tokens NFT projects we're going to support, which ones we're not going to, that maybe they would have avoided a little bit of this. I'm not sure. You know, it's, it's hindsight's 2020 here, but a little more regulation. I don't think those smoking non-smoking sections work too well. The smoke went all over the place. Is that so? Can you remember coming out

of a bar and you woke up the next day and you're close, like, Smoker, you have to take a shower when you went to a bar or a restaurant or a club. You have to come home, take a shower because your hair and your clothes, the smell of smoke goes, you can sleep in the bed,

then your bed had to, you had to change your sheets. Discuss. Remember when you went on a commercial flight, then a smoking section, a non-smoking section. It's a tube. It's a tube. The smoke gets all over the place. No.

You know you're on the wrong airline when they have the welded shut ash drain. They used to have an ash drain in every seat. In the arm rest, was his... By the way, a friend of mine, this is like such a throwback, but a friend of mine. Well, no guy a throwback, but a friend of mine. Well, no, guy, you know, I'll say the name, you can bleep it out. Please, please, please, that out, please, very important.

We don't want to. Is an notorious smoker. And so I flown with him. That's the worst. And we get in there on his plane and then we, he shuts the door and I'm like, smells a little odd and he smells a little cold home beat. I'm like, seven hours, I'm going to have to be in this. To the pilots get hazard pay. I mean, how do you compensate them? I mean, this is not a turbo prop. He's on. He can't crack the window. No, it was a global, a huge global.

It was, it was a little bit. At least it has three cabins. You could go to the back cabin. I felt so sick. I mean, it's the worst. It's the worst. It's the worst. The smoking is the worst.

The smoking is the worst. All right. Well, we didn't, so long to the sultan of silence as a, as a, as a science rather there, pulling update here, sacks. I don't mean to poke the bear. I know it was a rough week with the Fox news news. Bring it up. Bring it up. No, go for it. Quick polling update between putting Ron. I'm sorry, DeSantis and Trump.

Not going to happen. DeSantis is not happening. In late March, news of Trump's indictment boasted him over DeSantis by 26 percentage points among Republicans and Republican independent, but are all of this week the same polls show that Trump still need shrunk by 10 points in the last two weeks to just a 16 point advantage, which is still significant. But there's more a University of New Hampshire survey center poll. I don't know if any of these polls are reasonable or not. That seems like called people on the phone. I don't know who any of these polls are reasonable or not. If it was like, call people on the phone. I don't know who's got a landline.

Released Wednesday showed a 20 point to Santis deficit. What's going on here, Sacks? Did your boy peak too early? No, I don't think so. If you look at the Republican primary field, to Santis is the only person who's got a shot other than Trump. You look at Nikki Haley, she's polling in the 3, 4, 5% range. All the others are at 1 or 2%.

There's not a candidate other than DeSantis that has over 5%. So I might view this as a Trump DeSantis race. Now what you saw is that when Alvin Bragg pressed charges and in dieted Trump, it created a lot of sympathy for Trump among Republicans. Effectively, what happened is Republicans registered their displeasure with Alvin Bragg by indicating support for Trump. Let's go. And that's what you expect to happen.

And a lot of people speculated that might be the purpose of Bragg's prosecution is to make Trump the candidate. So we knew that was happening. But I think this new poll that you just mentioned is really interesting because it shows that that sugar high of Trump's poll ratings was a temporary bounce and it's coming down somewhat. And so what you saw actually is that

this huge poll bounce that Trump got is somewhat normalizing. Now, there's no question that DeSantis is running behind Trump and he's got his work cut out for him if he's going to upset Trump as the nominee, but this thing is just getting started. I mean, DeSantis isn't even formally announced yet. And remember, we're still very, very early in this race. The primary battle that this most reminds me of would be Obama versus Hillary in 2007. And at this time in 2007, Hillary had a huge advantage over Obama. She was considered the favorite.

She was considered the one who couldn't lose. And it was Obama that pulled off a huge upset. And he did it by fundraising her, out hustling her, especially in building organization and some of those early primary states. And then he eventually created an narrative that it was time to turn the page. But he didn't do that until much later in the year, much closer to the primary. The first Republican primary is not till February. So there's plenty of time here. And I, you know, we'll see what happens. To Bethany, that's I think Nikki, we'll see what happens to Rothman. It does.

I think Nikki Haley is going to win the Republican nomination. The more people, the more people here, here's the thing. The number of people, the number of people that have told being the most impressive moment with DeSantis was before they met him. The second most impressive moment was their first meeting. And then it just falls off a cliff where he becomes more and more Unimpressive the more and more time to spend with this guy. Hey Nikki Haley come on the pod. Nikki Haley is the opposite Nikki Haley announced that in all of Q1 in all of Q1 she raised $5 million extremely unimpressive

You're probably 20% of that schemoth And Nikki Haley come on the pod. We'll double it. How much do Nikki Haley's 5 million was, was you? Listen. Zero, I can say definitively you said Q1. Zero. Yeah. Two. Okay.

We're going to zero. But let me ask a question here. I, because I, I'm not informed on it, but you, you, you are a master strategist here, 1600 rated chess player sacks. That's not that good. Well, I mean, it's double 800 where I'm at. You're killing me in 27 moves on average. The Santhus is fighting with Disney over and over again.

He's getting a little involved in the LG GPTU, everything. And he just seems to be getting involved in the culture wars. Is that like a primary strategy and then he moves to the center when he comes to the general or and do you agree with this general fighting with Disney and the culture war stuff? Well strategicly not your personal opinion on these issues. I know that you're a very tolerant person. Yeah, so I think this is an issue that works for him certainly in the Republican primary, but I also think it's going to work from in the general.

And you have to remember that this bill that they're fighting over was a parental rights bill that basically it gave parents the right to know what their kids were being taught in schools. And it basically prohibited the teaching of this sort of gender ideology in schools. And I think most parents are on board with that. Now, he didn't go, yeah, he didn't go looking to pick a fight with Disney. Disney then got involved and took the side that calling this a Don't Say Gay Bill, which I think

just factually is not true. The bill doesn't mention gay or homosexuality or anything like that. It was really about this trans issue. Disney got involved and this was Bob Chepack. Bob Chepack lost his job and Iger came in. Iger has said that he basically lectured the Disney employees saying that we need to say out of politics and we need to respect our audience's views.

I think that it was Disney who kind of interfered. I think this is overall played to distance his benefit. And look, the problem for Disney, they may win the battle over this or that tax benefit that they're fighting over, but they've lost the war over this issue. Because parents used to be able to trust that they could just plop their kid down

in front of a Disney movie or a Disney show like Disney was like the babysitter and they just 100% absolutely trusted all Disney content. And if you look at polling now, Disney's brand, it used to have like an NPS of like in the 50s, is now in the single digits because let's call it half the country's parents, the more Republican ones, don't fully trust Disney's content and programming anymore. Really? That is a huge... Yeah, that is...

... implicitly. Well, could they ever do that subjection? Why? I've never seen anything objectionable. A lot of parents are questioning what content Disney might be putting in their recent programming. Obviously, we're not talking about the stuff that we grew up on. So look, whether you believe that is a problem or not, what I'm saying is this has been a brand disaster for Disney getting involved with

DeSantis this way. They should really, I think, just try to patch this thing up. I don't understand the benefit of Disney. Yeah, this is a bad look for both. It's a bad look for both people. Yeah. Well, I think I understand the benefit for DeSantis. I don't understand the benefit for Disney. If I were them, I'd be trying to patch this up. I think there is a really valid discussion to be had about representation in movies and all that stuff. And I'm very pro that. The thing I think all parents agree is

we should just at least know what's being taught to our kids. And we can have a thoughtful discussion about it. There seems to be some small group of people that thinks we should hide from parents what they're actually getting, what's being taught. And I find that's very strange. I think just a little bit of like transparency. And what's being taught in schools is an obvious thing that nobody should be disagreeing

on it. To saxophone, I think it was Pew that put out a study recently. It is the most polarizing issue amongst Americans where Democrats and Republicans are literally on opposite sides of the spectrum. It's going to be a big issue on the whole trans issue. Now, despite the polarization, in terms of the quantity of the number of people, it's actually an important issue for a small percentage of both sides. So it's a highly complicated political dynamic in America. Yeah. Very.

So this is where DeSantis clearly has taken the approach that not only is as important to the base to an nomination, but it's going to scale into the general, and it could very well be, but it's a very divisive issue. Yeah. I wish people were given a little bit more consideration and maybe they could have. I feel like maybe we're covering this issue too much. I referred some other folks in the community to say like maybe people could be given a little bit of their privacy and to handle these things. I think you're right, Jake, how in the sense, I think this issue has become a lightning

rod. And whenever you have a lightning rod issue, the amount of attention paid to it, it seems disproportionate to the attention on that issue. However, I would say that this is a lightning rod for a larger issue, which is the quality of education in this country, which I think is shockingly bad, and it's bad because of the decline of standards.

They're getting rid of advanced math, they're getting rid of green, as to making compensation. And the schools are run by these unions who are managing it for their own benefit, not for the benefit of the students. And look, there is a significant ideological component that's crept into these schools as well.

So look, I think that overall, I think that when you get into the general, you have to up level the issue and talk about it in broader terms that every kid in our country deserves a high quality non-ideological education. I think if you can do that, you will get 70-80% of the public on your side on this issue. Yeah, I feel like, yeah, I think we can all agree on that. Democrats, Republicans, everybody in between. If you're a parent, you're not looking for an ideological battle at school. You're looking for math, science, technology, history, creativity.

There's a whole bunch of other things that we should be really focused on. All right, listen, this has been another amazing episode of the oil and podcast. To people going to the episode 125 meetups, You can type in all in meetups. Our team over there with super fans are doing it in over 50 cities. The day this comes out, so you may miss it, but you can sign up for the next one. I'll be phoning in and zooming into them. So for the fans, you crazy lunatics getting together. Have a great time. Have a great time and tweet it and mention us on Twitter. For the Sultan of Science, the Rainman, the dictator. I am the world's greatest moderator, and we'll see you next time, bye-bye.

Bye-bye. Bye-bye. We'll let your winners ride. Rainman, David Sack. I'm going on a win. And it said we open source it to the fans and they've just gone crazy with her. Blamby West, I'm queen of King Wild. I'm going on a win. And it said we open source it to the fans and they've just gone crazy with

We should all just get a room and just have one big hug or two because they're all just just like this like sexual tension that we just need to release that house. What your, that be, what your, your, your, your, be. Be, what? We need to get merch. I'm going on, Leighlin! I'm going on a lead!