Big Technology Podcast - Apple's XR Misadventure, An Emerging AI Bubble, Elon vs. Bezos

Episode Date: May 19, 2023

Ranjan Roy of Margins is back for our weekly discussion of the week's tech news. We cover: 1) Apple's mixed reality struggles 2) Whether the stock market is in an AI bubble 3) OpenAI's Sam Altman testimony in Washington 4) Montana's TikTok ban 5) The rise of Shein 6) Whether Musk or Bezos is in a better place today. -- Enjoying Big Technology Podcast? Please rate us five stars ⭐⭐⭐⭐⭐ in your podcast app of choice. For weekly updates on the show, sign up for the pod newsletter on LinkedIn: https://www.linkedin.com/newsletters/6901970121829801984/ Questions? Feedback? Write to: [e-mail]

Welcome to Big Technology Podcast Friday edition. We break down the news in our traditional cool-headed and nuanced format. We have a great show for you today. There's an unbelievable preview of Apple's mixed reality device out that we're going to discuss first. Then we're going to be talking about whether there's an AI bubble with stocks like Nvidia going through the roof. Then Open AI ends up in Washington with Sam Altman testifying before Congress. What can we really learn from that? And after the break, we're going to cover the TikTok ban in Montana. How long is that going to last? And Sheehan or Shine. Ron John,

is it Shine? It is Sheehan. And this is going to be the most important story of the week. So stick around. And you'll all learn how to pronounce the most important company to watch in American tech. Let's start this week talking about. how Apple's mixed reality device might not go according to plans. So there is a terrific, terrific story. I'm amazed that it's not getting more play this week by Mark German in Bloomberg talking about the shortcomings of this device. Let me just kind of run through them pretty quickly. It is something that Apple expects to sell a lot fewer devices than it did previously three million expected, but now it really expects 900,000 units. It has

many non-Apple features, big, bulky pieces of hardware that just is not very traditional with Apple. There's a former Apple marketing executive saying that it could be one of the great tech flops of all time. And it is very different from what the company originally envisioned, making it seem like they're just going to try to ship something versus, you know, build until it's perfect. Do like cut, measure twice cut once, which is the way that I, Apple typically builds. So very, very interesting article. Now I really can't wait for Apple to release this thing. Ron John, what's your perspective here? Do you think that, I mean, for German to come out and say that this thing, you know, is not going to be what was expected. It's a pretty

big deal. Yeah, but, okay, the most interesting part of the article for me was he writes, Apple's ambition is that customers will eventually wear the device continuously all day, replacing daily tasks done on an iPhone or a Mac, such as playing games, browsing the web, emailing, doing FaceTime video calls, and on and on. It's the idea that this is supposed to become the new iPhone. This is supposed to be your primary computing device. That worries me a little bit. That feels a little overly ambitious. And I think one of the biggest problems I've had with the way Facebook slash meta approach the Metaverse was, it was an incredible gaming technology, our headsets and trying to, you know, force, feed it into your everyday life because that's a

better total addressable market rather than really evolving it as a gaming device and then seeing where it goes. I think it was a huge mistake. So I think Apple, if the goal really is to try to match the iPhone rather than make it the watch or AirPods and an accessory, I think that's going to be a huge problem. And a huge problem is where it's gone. So there's some conflicting reports because Palmer Lucky, front of the podcast, has tried these glasses and said this week that he thinks they're amazing. And maybe they are in terms of the current category, right? But you have to think about what Apple was trying to do and where they landed. And this is a passage from the story. So Gervin says after initially setting its sights on a lightweight pair of augmented

reality glasses, Apple gradually drifted towards something that felt more like existing devices because of technological constraints and the desire to get the product on the market. Oh, and internal disagreements. So here's what that points to to me. First of all, what makes Apple Apple is that it's able to imagine the future and build that future, right? Even when the technology says it's impossible. Remember when they introduced the iPhone. Steve Jobs said what?

This is years ahead of the nearest competitors, and it was because while other competitors were dealing with inferior devices, Apple pushed forward and built something that changed the game. And this seems like it also ran. And then you talk about the internal disagreements, right? What's going on culturally inside this company? And the last thing is, and this is probably the most concerning of the entire statement, is that the desire to get the product on the market led the company that basically put out something that is not what it hoped initially. That's just not what Apple does. It doesn't rush things out to market and it's doing that. This had me thinking a lot and I am someone who waited in line for four hours for the first iPhone. I've been a long time

Apple fanboy. But the last few years, it's definitely felt innovation is incremental rather than transformative. Every additional iPhone has gotten less and less exciting. Your new watches are a little bit better. So it'll be a huge challenge to see, you know, can this really be that transformative? But I do think like, you know, now when we look back that first iPhone was a game changer, but at the time I was made fun of

because it didn't have copy and paste in the text by people at work. Like a lot of people said it was ridiculous to wait in line and spend that much money on a device for a phone because the idea of like a smartphone as a computing device didn't even really make sense to most people at the time. So I think casting it out that easily, it still is Apple, and especially if it fits into their ecosystem, because again, I switch from Amazon Echoes to the home pods,

and it just works, and it's not even perfect. It's far from perfect, but now my smart home I can talk to from my watch and my phone. And the whole ecosystem still is where Apple wins. And so how well they integrate this device and bring in a new form of computing into that ecosystem, I still think they're better positioned than anyone else. I'm not buying it, all right? I mean, when Steve Jobs came on stage and introduced that iPhone, you know, internet machine, a phone and browser, a phone, and an iPod together.

Yeah. Okay. And look, watching that, I remember, I remember, it's the only technology announcement that I remember where I was and I'm not a gadget guy okay so I'll say that in the beginning I remember where I was and it was clear that this was going to change the game they had so many cool features and those people that were saying well it doesn't copy and paste they were haters okay and frankly you know there's going to be people that will find the problem with everything and that's where they were but and I don't know I think that it was clear on that day that this was something that was pretty

transformative. This device does not look revolutionary. It looks evolutionary. And I'm willing to admit if I'm proven wrong, I'll be proven wrong. But I had never seen a story like this about Apple in the Tim Cook era or in the jobs era where the company is working towards this major, major, major device that things could be the next era of computing. And there are all these concerns about it. Now, if they pull it off, credit to them. Right. They've been, and they've been doing some things, right? Their internal chips, the ones they've designed the M1 and M2 are amazing. I mean, I'm recording this on a laptop with one of those chips and, man, it's better than anything I've ever used. The laptops work well, the phones work well. But it's an inability to make that

next transformative product is going to look disastrous if this flops. And it is a legacy thing for Tim Cook. Yeah, but this, think about the watch, not the iPhone. When the Apple Watch came out, It was supposed to be this luxury product. Remember they had the gold-plated one, Johnny I. It was a watch. It was not a health monitoring device or a fitness tracker. And that's an example where Apple showed they can create a killer product by one actually evolving it to meet the ways consumers are using it

and what consumers were demanding. And two, just making it vital to their ecosystem. And again, I have a watch. I have the iPhone. For a couple of years, I left. I got a pixel. I got a surface. I tried to leave and then I came back.

You just can't handle being a green bubble, right? It's just easier. It's just easier. Actually, I remember at the time, I was married at the time. And one of my friends who was single, I was telling him how good the pixel was. And he's like, I'm sorry, man. I just can't, I can't text someone with the green bubble when I'm trying to date. That's the kiss of death.

So it is. but yeah it's the ecosystem and and again and we talked about this the other week with brian from tech meme like for me the magic leap was still one of the coolest technology experiences i've ever had so and and it's almost been disappointing for me and like why has that technology not taken off and i actually think of because i ascribe everything to zirp i think like overfunding and just overhype around the magic leap is what led to their demise hollow lens with from Microsoft from people I know who used it you know they talked about how amazing it was and that kind of got sucked into Microsoft corporate politics when that company was going through

a lot of change that technology is waiting to be released into the world and made you know into everyday use so so I'm pro headset well we can take the opposite sides of the matter of this one I again have to disagree with you I think the problem of magically wasn't that it was overhyped and overfunded. The problem was that they never released a consumer device. And, I mean, they did. They eventually released something, but it was expensive. It didn't work very well.

And they pivoted to enterprise. And the reason why they pivoted to enterprise is because it just was not convenient to wear those glasses in the pack around as a consumer. That's where the opportunity is for Apple. It's to build something for consumers, to push the envelope forward on technology, and create that pair of it. of glasses that you could wear that has these capabilities inside that no longer forces you

through the constraints that you used to be with other technology. And I think the company's inability to do that, right, and the fact that they're going to ship something that doesn't meet that part that they set originally because they need to ship something, who, who. I'll agree. One part of the report said, like, you might have to have a battery pack that's like attached to you, which is kind of how the magic leaf was you had a pack that you would kind of clip to your belt if that's the case this is not this is not going to work maybe though and and then maybe snap spectacles come out of nowhere and and and take over and assume their rightful place is the augmented reality kings maybe maybe but yeah i think if there's like a battery pack if it's not really a cool product it's not

Imagine your single friend who couldn't bear to be a green text showing up to a date with Apple glasses and a battery pack. See ya. Okay. The Google Glass, 2023. Here we are. Gone. So, anyway, we'll see what happens.

Look, I know that there's a lot of people who are big fans of Apple that listen to the show. Obviously, it's a very impressive company. And it would be unfair to judge the company on one product release. And we haven't even seen it yet, so this is clearly speculation, and maybe they're going to do a good job with it. But if they don't, it's going to be a problem for them. And it won't necessarily diminish what Apple is, but it could lead to a narrative shift, and that would be interesting. So anyway, Apple, good company, potentially, you know, shaky launch coming up. And look, Ranjan, here's a thing.

If they go ahead and launch this and it's great, then I will come here on the show and I will admit that I was wrong. I just don't think I'm going to be. All right. Let's wait for that. Speaking of overfunding, the AI stocks this year are ripping. Anything that's touching AI is just basically going through the moon right now. And we like to talk about bubbles here. And there's some talk now maybe on the stock market that we are going through a bubble.

And front and center is Nvidia, which is up 116.93% year to date, hundred sixteen percent i mean is invidia this is sort of the questions we were asking in the zero interest world is invidia today double the company that it was when we started the year double the company i kind of doubt it what do you think yeah i think stock market valuations who's going to win the hype around it is very problematic because we have no idea what the business models are going to be and we've We've talked about that a lot on this show that right now every chat GPT query is a money suck. Open AI loses tons and tons of money.

They've had to kind of like use financial whiz-banggery with Microsoft around a quote-unquote billion dollar and then $10 billion investment when in reality it's just using cloud credits and who knows what revenue is being recognized where. But like no one knows what the business model around any of this will be. around the hardware side of it, around the software side of it, around the services side of it. And I think like, you know, last week we had talked about the, or maybe it was a couple weeks ago, open source versus big tech could open source even come out of this as a winner, which would completely eviscerate a lot of the investment DCs around this. So I think everyone, because all you

have to do is say AI and investors come rushing in and probably AI algorithms are driving those investment decisions anyway from quantitative head funds. But I think it's way too early to make these kind of giant bets if people are really trying to figure out who's going to win and who's not. Yeah. So here's the argument for why we're not in a bubble. I was watching CNBC this week. Scott Wapner had the whole crew on. Josh Brown was making the argument that we were in a bubble. By the way, yeah, I think it's definitely a little bit of a bubble going on looking at that NVIDIA number. But Scott put up a chart and I was like, well, okay, let's really be thoughtful about this. So these were the forward PE ratios in the early 2000s. So Qualcomm was at 192 times

on the multiple. Yahoo had a multiple of 739. Cisco had a multiple of 134. Okay, here's the multiples today. Alphabet set 22, Microsoft set 31. Invidia, for all we've talked. about 63.7, Meta's at 19, and Amazon's at 76. So even if there is a slight bubble going on, maybe the market is just being restrained enough that it's not getting too carried away. I just had to Google, and I did not know this off the top of my head. Yahoo's peak market cap in 1999 was $90 billion. Come on, Amazon is what, one, still a trillion, 800 billion, alphabets, 1.4 trillion, you know, like these are gigantic companies.

So obviously a Ford PE ratio is still kind of extrapolating out future growth. So their growth will never be comparable to, you know, those at least the potential back in 1999 for a Yahoo or Cisco, which were still thoroughly overvalued, but not that, you know, on a relative base, it's not that overvalued. But I think it's fair in the sense that, right now it appears big technology companies are positioned to just kind of squeeze everyone else out and dominate the computing costs are so high the resources needed are so high they have the existing

ecosystems to deploy any kind of new apps and services so i think signs are pointing to these are the places to be and again like whatever that says about the economy as a whole is not necessarily great but that they are that they're positioned well but but i still think like i don't know It's still so early in this that I think, and maybe, lo and behold, there's a new player that comes out that we weren't expecting in this, which would be kind of exciting. Well, the one that you could say is already that new player is Open AI, right? Which has, I wouldn't say, come out of nowhere, but certainly increased its profile to the point where Sam Altman showed up in Washington this week to testify about safe regulation of

artificial intelligence. Congress is obviously taking in Washington and regulators around the world. No, we have an international audience, so we're not going to make this completely U.S. centric, right? This is something that governments around the world are worried about that AI is going to come in and do some things that are quite damaging. And we're already seeing some big bodies out here trying to figure out what exactly to do. So Altman goes in to Washington.

I found a few things notable. First of all, this is the person they're asking. It's the person who's leading industry. It's interesting. I mean, it does seem like if Sam is the one that's leading the regulation conversation, then aren't we just setting ourselves up for regulatory capture where the rules are set in a way that favors the incumbents and ice is out those other new entrants that we might expect.

And the second thing here is, man, like I feel like deja vu, really in some ways where we spent five years or something like that talking about the potential to regulate meta and Amazon and Apple and Microsoft. All of Congress agreed on it. There were actual common sense rules. that you could put into place and they did nothing. So why is something going to happen here? Yeah, I am definitely, in terms from like a legislative standpoint,

I'm not thoroughly optimistic, but I think it's good that these conversations are starting right now. But I also agree that the fact that it's Sam Altman up there, I don't think is necessarily the best thing. Now, I am genuinely confused as to what exactly Open AI and Sam Altman are trying to do? Like, is this just some, you know, long-term regulatory capture strategy?

Because what kind of regulation they're actually looking for, I never understand this argument that comes from so much of, you know, the biggest, most influential people within AI is the idea that AI could kill us all, that there's these great societal harms, yet we're going to continue working on it and pushing, you know, wholeheartedly into it and it's going to be the greatest business opportunity and we want to be regulated to this existential, around this existential threat, but we don't know anything past that. And we don't want to stifle innovation. So I'm genuinely confused as to what is happening, what they're trying to do here

and what's happening here. Well, here's one theory, which might be that Sam Altman just enjoys being the center of attention. And, you know, one of the interesting things that came out of the hearing was that he said he has no equity in the company and just kind of makes enough money to buy his own health insurance and loves what he's doing and is it crazy to think that sam might just be like that unicorn type person who's just like not man i can't even believe i'm saying this but not doing like evil genius ways to like 4d chess the congress and to not regulating his company but might actually just kind of enjoy working on this transformative technology and enjoy being the center of attention and that explains everything.

Alex can see on the video stream the smile across my face right now. There are moments. So one, him saying he has no equity in the company blew me away. Two, this idea that basically there's no salary. You know, he's already rich so he has enough money that he does not need anything out of this is a really interesting twist as if it is completely. completely confirmed, which I'm not sure, everything is still based on what has been publicly stated, not any kind of actual documentation.

But yeah, I think, but if that were really the case, wouldn't he go up and comfortably say, you know, we trained and stole the work off of like tens of millions of people, and I know that could be problematic, so maybe you'll have to sue the hell out of us for copyright infringement or that's a real issue you know like we know that disinformation will be created no no i mean he wants to keep working on things you know that's he has no equity he has no equity in this well that's what i'm saying that maybe it's just the pursuit of the work and that would inhibit the to create the to create the genuinely equitable uh utopian future that maybe he's looking for then that's where we should start because it's like rather than talking about robots killing us all

there's very real problems that are already happening today that could be addressed and are going to have to be addressed at some point. I think copyright to me is one of the most tangible concrete things that is going to, there's going to be a test case. There's going to be some kind of ruling around this, there's some kind of precedent. I think Section 230 has to be part of this conversation because, again, what is new content? What is original content? By definition, you know, every one of these large language models creates new content. Of course, they're, you know, synthesizing existing stuff out there on the internet, but it's new content.

So who's liable? This stuff is going to have to be addressed. And I think, like, trying to take a proactive stance and say, like, you know, maybe when you, if you want to regulate us, let's actually talk regulation, not just theoretical. Okay. So I'm actually going to point you to a piece of concrete stuff they did actually talk about. And it wasn't all we're going to be turned into paper clips, but there was this discussion of something that seems a little bit like an FDA for AI. So here's from the New York Times.

Echoing an idea suggested by Dr. Marcus, which is, of course, friend of the podcast, Gary Marcus. He, which is Sam Altman, proposed the creation of an agency that issues licenses for the development of large-scale AI models, safety regulations, and tests that the AI models must pass before being released to the public. okay so that's actually people have said this is an interesting uh approach where people get licensed effectively to build a i that's the part where i you know i heard that and it was just like okay wait a second maybe this optimistic take i had about like what open a i might be doing might be completely wrong because that fda for a i however common sense it seems um a i don't think it addresses a current problem where like the a i is going to turn us all into paper clips. Like, that's not happening right now. And B, like, who does that benefit?

Mm, you know, it benefits the incumbents and it benefits open AI. Yeah, the idea of, you know, who has the resources to do a full audit on existing models, even though they have the biggest models, it would still be companies like Open AI, Google, whoever else. So yeah, I agree that definitely would push towards benefiting the incumbents. But I think like to me at a larger level I still can't believe we're back here where, again, rather, Gary Marcus, I thought was a very good inclusion into this conversation because he's someone who's been deep in the space, you know, like a visionary in it, a successful entrepreneur in it,

selling a company to Uber, that was a machine learning company. And so at least having that as a counterpoint, him as a counterpoint was really good. But there's still this, even in that New York Times piece, I still can't get over like how we talk about, the author had written, The appearance of Mr. Altman, a 38-year-old Stanford University dropout

was as christening as a leading figure in AI. The boyish-looking Mr. Altman traded in as usual pull-over sweater and jeans for a blue suit and tie for the three-hour hearing. Like Sammy grew up and put on the seat. It's like, tell me what happened and get to the facts. But there's still this, he and maybe he has a, his PR has been genius.

he has established this like cult like figure of thoughtful wanting to help whereas in reality again open AI has just been has been just as aggressive as anyone else if not more so in the space so yeah i still feel there's a lot of other members of civic society that need to be brought into this conversation rather than the people who will stand to poise to to profit the most even though he i guess he does not stand to profit the most. Right. And it's also so I have no idea what's going on. Yeah. And the company, I mean, it started out as like a real nonprofit, but now it's cat profit. So, oh, man, I don't know.

It's a very interesting question. Maybe here's my, here's my pro wrestling, uh, uh, hope for this is out of nowhere, Elon pulls out some like amazing early days of open AI drama in the next few weeks. And we find out more about this story and things that don't, make sense around equity and pay that's my own that's coming yeah that would be great and uh look sam if you're listening come on the show i want to love to talk to you about this stuff um i've been trying to get someone from open i i don't know maybe they think the show is too skeptical of them but anyway i'm not going to change what what we do here uh to land interviews so i'm just going to put that out there

but i i am not skeptical of open ai the technology at all i think they're like like they are best positioned to win in this space. I think like what they've done is incredible. It's just this on the regulatory side, I don't think they're the ones who should be leading the conversation. No, no doubt. I think just talking about a PR standpoint, I mean, you mentioned that the PR has been genius.

I think sometimes when companies don't want certain questions asked, they'll steer their executives to certain places where those questions won't be asked. Okay, let's take a break. We're here with Ron John Roy of Margins. You can get it at readmarchins.com. Great newsletter on Substack. We break down the news here every week on Friday,

and then we have our flagship interview on Wednesday. If you're listening on the feed, we do these live on LinkedIn, so you can join us Fridays. Typically we record at 2 p.m. Eastern, 11 a.m. Pacific. You can check my LinkedIn page, Alex Cantrowitz, for weekly updates on when those conversations will be. Sometimes we bring in guests today, one-on-one. All right, if you're a longtime listener of the show,

show, and you can rate us. If five stars would go a long way on Spotify or Apple podcast, and if this is your first time here, and you want to subscribe, that would be awesome. Again, two shows on the feed every week. When we come back, we're going to talk about the TikTok potential ban in Montana. We'll see if it ever goes effect. And then we'll hand the floor over to Ron John to talk about Cheyenne. Hey, everyone, let me tell you about The Hustle Daily Show, a podcast filled with business, tech news, and original stories to keep you in the loop on what's trending. More than two million professionals read The Hustle's daily email for its irreverent and informative takes on business

and tech news. Now, they have a daily podcast called The Hustle Daily Show, where their team of writers break down the biggest business headlines in 15 minutes or less, and explain why you should care about them. So, search for The Hustle Daily Show and your favorite podcast app, like the one you're using right now. And we're back here on Big Technology Podcast Friday edition. Ron John Roy is here with us. Let's talk TikTok. It was band in Montana this week, but it's a very interesting band. So effectively, Montana is kind of counting on TikTok to like not make itself available to people in the state. What do you think about this? I like that this conversation is accelerating in terms of like it's not a ban, but it's

a ban. They banned app stores from offering new downloads of TikTok users. And you can still use a VPN. So it's still a very like, you know, Swiss cheese type of ban here. But I think it's important that these conversations are moving faster and faster. And I think, I don't know, we've talked about this a lot. I think TikTok gets banned this year. I think there's a number of reasons why it will and why it should. But even more important, I think like this is a reminder that it's not going to be in just one all out blanket ban. If it happens, there's going to be legal challenges, different things that happen over time. And then, I don't know, again, my prediction on this is there's going to be a few just gigantic scandals that come out and then, which there

have already been endless things coming out and dripping and dripping. And that's what pushes it over the edge. But the question is the legality, right? And there's already a lawsuit from creators against Montana to roll this back on free speech grounds. so it seems to me like maybe the most likely thing that's going to happen and Rokana was here a few weeks saying this is that it's going to be a it's going to be a forced sale by

this by Sipheus which investigates the deals that we have when it comes to like foreign companies versus like it just this is going to kind of show the weakness I think of the outright ban via legislation path you don't agree. Yeah but no no I think for sale and I've said parts of this before, but I mean, I'll reiterate it here again. There's no way of forced sale happens.

And there's a couple of reasons. One, the economics of it, TikTok, I mean, this is one of my favorite parts of this whole idea is like bite dance is another raised a ton of money, had a high valuation. A forced sale of TikTok would require some kind of hard price set around their valuation, around their economics, around the value of TikTok itself. And right now it's so inflated. So if you can imagine the back and forth arguing when it's essentially a forced sale, but obviously bite dance is going to want to get as much money as possible out of it to try to keep their overall business, you know, looking better than it potentially is. And then there is no way logistically and operationally this actually works. Like how do you really separate an

algorithm? The number of, you know, like connected data points, the number of salespeople, like, do you have to switch out every CRM system and the different pieces of data that are in there for advertisers. There's so much that's commingled, I'm sure, already. Or, I mean, that it just is that there's no way that you cleanly just slice it off, sell it at a price that both parties agree to. I think there's no way that that can happen. Well, the government could just say you have to figure it out. And then, like, the government has forced sales before. So it's possible that it happens. Yeah, but not at this scale and with this sensitivity around geopolitics. Because to me, at a certain point, there's more value in making the U.S. look like they're going after Chinese companies and non-American companies.

There's much more value for the Chinese government in terms of that happening from like an overall, I mean, whether it's like a geopolitical or a PR perspective, then the idea that it's a forced sale and the negotiations that go around. around it and the operational challenges to go around that. So, yeah, I'm still calling it here. No for sale is possible. Let's talk about Cheon. So they raised $2 billion at a $66 billion valuation, which I thought was the news. But as we introed this show, you call them the most important tech company or the most important tech story.

So floor is yours, Ranjan. What should we be thinking about when it comes to this company and why is it important? All right. So just for listeners, before we- Ron John is right now to talk about this. Well, no, no, before we started the show, and I was like, she and Alex said, you know, like, all right, like, let's keep it around. You know, a lot of people might not know of it or it might not, you know, hold interest

as much. And also, you're not the first person, Alex, who pronounced it to me shine. And this is a company that is the fastest growing retailer in the world that is overtaken or is neared H&M and Zara in sales. No, no, it's surpassed H&M. Oh, yeah, sorry, it's surpassed H&M. It's at $23 billion in sales, and that's almost all growth in the last four or five years.

It is overtaken American retail quietly as a Chinese company. So, I mean, TikTok is headlines, but Sheehan is actually, you know, quietly taking over American society or, you know, in business just as much. but also what I found interesting was this was that Sheehan was valued in their last round at 100 billion. Their latest $2 billion fundraise was only at $66 billion. I think this is kind of a cool, like interesting tidbit around a 33% valuation cut didn't seem to be the news or cause any

panic. It feels almost like a recognition that previous 2021 valuations were just unreasonable. And also starting to position themselves for an eventual IPO, that in the past, the game was set expectations as high as possible and then hope that the public markets just go play along and buy at that value. Now it seems like, all right, let's be a little smarter. Let's make this at a reasonable so we don't come out and then lose value right away and actually show some upside to public market investors. So I thought that was another interesting angle. But an even more interesting angle for me is in a wall street journal's long coverage of this do you know who was quoted tell me all right marcello okay i don't know you know clor clower the former soft bank executive

who i believe became CEO of we work for a little bit you know like this is this big name in technology he is now he was appointed the head of she the chairman of she and last Latin America a couple of months ago. So he's only chairman of Xi in Latin America, but now they're kind of positioning him as the figure, the public face of Xi in America. And I think this is where it gets interesting, the way they're playing this, is like trying to distance themselves from the Chinese connection, Chinese origins, and seeing how companies like this really are, you know, incorporating geopolitical public relations into all

their decision making into who represents the face of them like again 66 million dollar company fastest growing retailer in the world do you know the name of the CEO no i don't even know where to buy their stuff okay i don't even i actually i'm talking about this on shian dot com it's it's all online yeah it's all online they've had a couple of pop-ups i believe but they're they're doing collaborations they launch this thing she and x with indie designers they they you know they're getting into culture, retail culture, fashion culture, as much as anyone else. And again, the idea that, like, H&M and Zara, their global reach and recognition is just so ingrained in just everyone, right?

Now here's a company that's overtaken H&M in sales. And you're, again, I've been on like panels with retail folks who pronounced it shine as well. So it's not making fun of me about that. No, I'm not, I'm just saying you're not the first. You're not the first. Hey, there's stuff. It looks amazing.

Oh, my God. It's so cheap. It's so cheap. Well, okay, so this is another reason the story is interesting. What Sheehan essentially did was. This is amazing. This clothes. Yeah, and do you know?

And they're cool. And they're cheap. Whose most vulnerable, I think, is Amazon here. Amazon is in a huge potential for disruption because what's happening is what Sheen and then T-Moo is another, it was another, another, a really fast-growing Chinese started playing the same game. All the Chinese sellers that from like 2012 to 2019 that Amazon was basically arbitraging, that Amazon was finding cheap Chinese sellers opening up their marketplace and letting them sell to American consumers, now Sheehan

has built a marketplace that directly connects us to them, not through Amazon, but we buy from those same manufacturers at a much cheaper price. And also their shipping is, a little bit slower. It's like 10 days, two weeks. So the kind of the deal is we're going to give you stuff that is cheap as hell. You'll wait a little longer for it. But, you know, it's especially in this economy, it seems like an unbeatable proposition. I'm going to fill my cart before this podcast is done. Holy moly. This is wild. Sorry. Hold on. Do you do, no, no, do you know about Shee and Halls? No. This is a TikTok trend when you say you're going to fill your cart. one of the things that really kind of blew them up was people literally buy boxes of stuff

and like say like this whole box only cost me $180 and then dump it out and like make just this show of gluttony and consumption and that's the trend so yeah serious search hashtag she and hall on uh and your favorite social media platform and you'll see what I'm talking about and 10 days three weeks, if you don't live in Montana, you're going to see a new video for me on TikTok doing exactly this. Wow, this is amazing. So how do you think this, does this change the tech platforms or the retail business in the U.S. at all? Yeah, I think Amazon is hugely vulnerable. I think like H&M and Zara, or especially H&M, definitely vulnerable. I think this is the most interesting story in e-commerce and retail that has kind of flown under the

radar because, again, their growth is insane. And just how well and successfully they pulled off the ability to, you know, just like make their way into global retail and do it, you know, in a really quiet way. I think it's fascinating. I mean, I'm stunned. Like, they have wedding dresses for 3699. I mean, that's, I don't know who's getting. married in a Sheehan dress, but you could do it. You can. All right, we're going to, let's, let's, why don't we put a pin on this and let's come back to it on a future episode.

We talked about potentially inviting John Herman on from New York Magazine, who's written about TEMU, which is another one of these sites. I kind of feel like it merits a full, full hour of discussion. But, wow, I'm glad we kept it in. You've definitely opened my eyes to this thing. So, yeah, maybe, my single friend who wears his apple. headset to the date to marry the girl wearing the she and dress. Wouldn't that be beautiful?

Everyone will be happy. Exactly. How does that relationship not last? I'm curious. I actually have a question. Like let's let me take a moment of self-awareness. How do you think I didn't know about this? I mean, it's bigger than H&M.

How was I unaware? Like am I just like is my head in the wrong place or how do you think I ignored it? In fairness to you, you're not a 22 year old girl. I mean, I think that's as a starting point. confirm that yeah but i i mean no that this they have not gotten a ton of coverage i wrote about them in october and like that's why i was i was trying to start to lay out the case that this is really interesting story and they still again the two billion dollar funding only got covered in the wall street journal who got access to marcello clor like so obviously they wrote about it and

they wrote a good long piece around it roiders has like a short piece about it no one else covered that story. Two billion dollar fundraise in this environment for the Chinese company that's becoming the dominant retailer in the U.S. And it's nowhere to be found. And I'm always a little hesitant to say no one is talking about it. Because when in reality, when a lot of journalists are covering things, but this one really is not being covered. Except here on big technology podcast. Technology. Fun story of the week.

Jeff Bezos is $500 million yacht. Has a sculpture of Lauren Sanchez, who's his partner on the front. And she's wearing the symbol for Kauru, which symbolizes new life, growth, strength, and peace. And it's a symbol that's special to the couple. I mean, Jeff Bezos, man. He's gone from this very unassuming nerd to someone who literally sculpted. his partner into the front of his boat. I just thought that that was wild.

I got to say, if we're choosing between world's richest man, who's doing better right now, Elon versus Bezos edition, I got to give it to Jeff, man. It's ridiculous. It's midlife crisis-y, but he's having a great time while Elon is doing whatever he is doing at Twitter. Jeff is really leaning into it right now. It's interesting because, okay, so first of all, I saw that, and I was like,

and my immediate reaction was like, there's no way he's ever returning to Amazon. It doesn't matter what happens with the stock price. My second reaction to that was, well, no, actually, now that you're bringing this up, like, who's in a better, I mean, obviously Bezos is doing the world's richest man thing better, but I also wonder who's going to have, like, the bigger impact. I mean, Bezos, like, okay, he created Amazon, credit for that. but if you think about and he's like obviously he's held up as a business genius for good reason but then you think about the other things he's done he's actually competing with elin in a few

areas he's got the space satellite stuff starlink is the household name there and he's got the rocket company SpaceX is the household name there and you know amazon invested in rivian big time okay so tesla is the winner there I mean, he didn't invest in, you didn't do the whole Twitter thing, so points to Bezos on that front. But I still think you can make an argument that even though Elon's having a worse time of it, he's going to be more impactful than Bezos. I think I agree Bezos in the, in the history books will be remembered as just a business leader and nothing more than that where Elon will certainly be a character more with more stories in depth than. The state of humanity forward. Okay.

For better, for worse, he will be remembered. He'll be more in the history books about Elon than Jeff. Also, maybe once Sheehan starts eating Amazon's lunch a little bit, Bezos will be called back into the office. And I mean, yeah, Amazon and what's going on over there. That's for a whole other episode, I think. Well, I think that Bezos could also just wear those. Shia in shirts, fun Shia in shirts to music festivals.

Because they certainly, the ones that I've seen on the homepage at least seem to fit his style. All right, Ron John, thanks for joining, man. This was great. This is definitely one of our more fun episodes. So it's nice to go one-on-one with you, man. Yep. See you next week. Okay, see you next week.

Thanks, everybody for listening. Thank you, LinkedIn, for having me as part of your podcast network. Folks, I are going to preview two really fun episodes we have coming up. All right, we have a conversation. with Astro Teller, who is the captain of moonshots are also better known as the CEO of X at Alphabet. I just interviewed him, and we're going to talk all about the experimental projects that Google's working on and why it's experimental arm didn't produce the chatbots first. And speaking of chatbots, I have a conversation with Jack Crotchick, who is the senior director on Bard at Google.

We get decently into some of the reasons why Google's been slow, although it's kind of tough. sometimes to get concrete answers from people who are working on these projects directly. All right, that'll do it first here. We'll see you next time on Big Technology Podcast. You know, So, Thank you.