TBPN Live - Mark Cuban, Vlad Tenev & MORE | Larry Ellison's Cloud Scores Big, Silicon Valley's Family Life, Qasar Younis, Minna Song

Episode Date: August 20, 2025

(00:21) - Timeline (06:37) - AI Orality Opens Up the Grift Gates (27:23) - Ellison's Cloud Scores Big with AI Titans (44:25) - Timeline (01:35:31) - Silicon Valley's Pro-Family Posture Fights Reality (01:46:00) - Timeline (01:57:17) - Vlad Tenev, co-founder and CEO of Robinhood, discusses the company's evolution into a comprehensive financial platform, offering services like credit cards, banking, and retirement accounts. He highlights Robinhood's mission to democratize finance by enabling customers to manage various financial assets and transactions within a single app. Tenev also emphasizes the integration of AI to enhance customer support and the company's commitment to expanding access to financial markets, including initiatives to involve retail investors in IPOs and private markets. (02:31:59) - Mark Cuban, a billionaire entrepreneur and owner of the Dallas Mavericks, discusses the potential risks of integrating advertisements into AI models, emphasizing that such practices could lead to manipulative outputs and ethical concerns. He highlights the importance of maintaining transparency and trust in AI interactions, warning that ad-driven algorithms might prioritize profit over accuracy, similar to issues observed in social media platforms. Cuban advocates for clear identification of any advertising within AI platforms to ensure users are aware when they are being marketed to, thereby preserving consumer trust. (03:02:38) - Qasar Younis, co-founder and CEO of Applied Intuition, discusses his company's role in providing software tools for autonomous vehicle development, emphasizing their profitability and high gross margins. He highlights their partnerships with major automotive OEMs, including GM, and the adaptability of their software across different hardware platforms. Younis also addresses the evolving landscape of vehicle autonomy, noting the industry's shift towards integrated, cost-effective sensor solutions and the importance of maintaining brand identity amidst technological advancements. (03:22:33) - Minna Song, co-founder and CEO of EliseAI, holds a Computer Science degree from MIT and founded the company in 2017 to address inefficiencies in housing communication. In the conversation, she discusses EliseAI's origins, emphasizing its focus on automating property management tasks through AI to enhance operational efficiency and tenant satisfaction. She also highlights the company's commitment to providing reliable, enterprise-grade AI solutions tailored to the unique challenges of the housing industry. TBPN.com is made possible by: Ramp - https://ramp.comFigma - https://figma.comVanta - https://vanta.comLinear - https://linear.appEight Sleep - https://eightsleep.com/tbpnWander - https://wander.com/tbpnPublic - https://public.comAdQuick - https://adquick.comBezel - https://getbezel.com Numeral - https://www.numeralhq.comPolymarket - https://polymarket.comAttio - https://attio.com/tbpnFin - https://fin.ai/tbpnGraphite - https://graphite.devRestream - https://restream.ioProfound - https://tryprofound.comJulius AI - https://julius.aiFollow TBPN: https://TBPN.comhttps://x.com/tbpnhttps://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231https://podcasts.apple.com/us/podcast/technology-brothers/id1772360235https://www.youtube.com/@TBPNLive

You're watching TVPN! Today is Wednesday, August 20 of 2025. We are live from the TBPN Ultradome, the Temple of Technology, the Fortress of Finance, the Capital of Capital. The Fortress of Finance is not in good shape today. Holy bearish, back-to-back tech sell-offs. QQQQQAW.

Having its worst two days since April 7th. I thought April 7th was Liberation Day. It wasn't Liberation Day. It was shortly after Liberation Day. But the NASDAQ did slide 1.5 percent on Tuesday. Some sort of correction was probably overdue. And we certainly aren't in any sort of unprecedented territory.

But public markets seem to be starting to react to some of the big top signal memes that have been flying around the timeline for the past few weeks. So we need to continue to monitor the situation. Joe Wisenthall has a great newsletter today that we're gonna be reading through. We'll be taking a tour of the timeline, of course,

digging into what else is driving the narrative, What else is driving the news? What else is driving the markets? This feels very different than the Liberation Day sell-off, not just because the Liberation Day sell-off was, I remember there were multiple days, we were in the gym, and we checked the market, and it's like down 5%.

It was just huge for a single day. Yeah. But Liberation Day to me always felt like there weren't that many tech considerations. Yes, apples in China, yes, there were semiconductor considerations. Taiwan and AI supply chains generally, but... The market was scared about tariffs, for good reason.

Yep. And people can debate that. But now the market is just effectively scared that AI hype is over, you know, over blunt. Yes, but there's, yeah, there's some sort of difference there where tariffs affect the real economy, the price of food, the price of gas, the price of, you know, like if there's going to be a tariff on lumber,

that's going to drive up housing costs, that's all the economy. We're talking about computer money. The money that's in the computer, that's the AI bubble. That's what people are trying to get out. They've been trying to get out of their laptop. They've been trying to hit the keys in the right order to get. If you had $100 million in your laptop and you were trying to get it out, well today it's only $98 million because we're down 2%. I thought this post from the account negative alpha was funny. This is a quote. This is an Annon account, but he says it's from his PM. He says, if your stocks are green today, you literally own dog SHIT. If your stocks are red today, you own AI. Basically, you're an idiot

either way. Not true, though. One stock that's green, of course, Home Depot, you heard it here on the show. If you were interested in going along, the Amish, our pick was Home Depot and Home Depot beat earnings, and I believe is doing well. About 100% over the last month. Yes. And hello to everyone in the chat. Thanks for tuning in. We're glad to have you here, and thank you for the feedback on the new soundboard. Sound the Eagle, I think, is a perfect. Fantastic. Anyway, when the market's down, what do you got to do to save time and money, Georgie?

You got to go to ramp.com. Easy to use corporate cards, bill payments, accounting, and a whole lot more. All in one place. Get your house in one place at ramp.com. Let's read through Joe Wisenthal's latest newsletter. AI Orality and the Golden Age of Griff. We live in an age of extreme grift. Grazy graphic here too.

Yes. What is this graphic? Come in, it's viral. This is the Dubai Chocolate thing. He breaks down some of the different viral products. And there's another article in The New Yorker that I put in the deck today that talked about IRL brain rot, the Labouification of the world and Dubai Chocolate and these ideas that are things that are designed to go viral,

viral but then instantiate themselves in the physical world. I think that that's interesting. We like when the slop stays on various corners of the internet. Yeah, and you can just hit, I'm not interested in that post as opposed to when you're walking around and you don't really have that option when you're at a store and it's stuffed to the gills with IRL brain rot. Anyway, Joe Wisenthal says, we live in an age of extreme grift. This is obvious. There are people out there publicly organizing pump and dump schemes. Now, someone is trying to sell you a dollar's worth of cryptocurrency for $5. These are, of course, the Bitcoin Treasury companies that are trading above net asset

value. They're trading above the book value of the cryptocurrency that they have on the balance sheet. Celebrities scam their fans by selling them garbage. It's all over the place. But that alone isn't particularly interesting. Grift has been around since day one, and there might even be a cyclical element. to it the economist John Kenneth Galbraith famously talked about the bezel not bezel which is course on a watch which you can go to getbezzle.com your

bezel concierge is of course waiting for you to help you source and you're watching the world they're seriously any watch but the bezel is about imbezzling not the bezels of luxury watches bad faith business practices that produce an illusory wealth effect which only gets exposed after the bus Once everybody realizes that everybody else is, or at least some people, are swimming naked. Yes, yes, yes. Joe says, the interesting part to me is the total lack of shame. Nobody bothers to try to hide it, and nobody really judges it either.

It's all just right out in the open. The world is awash in economic nihilism. We've talked about this sort of get-your-bag culture. Jim Chanos calls it the golden age of fraud. Anyway, I know I haven't provided any hard evidence that things have become more to range. This is just my sense from looking around. If you disagree with the premise, it's fine if you want to stop reading, or in our case, listening. But that being said, before going further, I want to take a brief detour.

In the middle of the 20th century, when the television really emerged, it was probably seen as the polar opposite of the book. So the television emerged in the middle of the century, 20th century. That was before re-stream, correct? Yes. So they couldn't do one live stream with 30-plus destinations. Not a chance. They couldn't multi-stream and reach their audience wherever they were. Certainly not a change.

Interesting. Yeah. Anyway, go to Restream.com. But now you can. No, you can. So highly literate people look down on the idiot, quote unquote idiot box and so forth. However, two dots on a plane that initially seemed very far apart will start to appear closer as you look from a distance, and that's how it is with books and TV, which actually

have a lot in common as media types. Both engage the eyes, and actually with subtitles, both can be consumed in silence. Growing up, my parents were into film, and they would routinely say that TV rotsy or brain that was like brain rot was a term that was used for just television generally yeah and and now we are so far beyond that yeah anyway continue yeah now it now it's Algo feeds right your brain the TV's the TV is great Lindy yeah it's yeah turn it on and enjoy it's it's for it's for the the poo bear wearing a tuxedo yes yes the whin the poo and both are passive one-directional

media forms that that can be consumed alone both are very costly to produce and distribute at scale which has a gating mechanism in terms of who can get involved. Moreover, television definitely has more in common with the book than radio does. Radio has a long history of bi-directionality, whether we're talking about trucker C-Bs, call-in shows, or amateur ham radio that can be broadcast on a shoestring budget from your basement. I was thinking about this the other day when I saw that Amazon is investing in a company

that will allow viewers of TV shows to use AI to create their own scripts of shows they like and somehow insert themselves into the show itself. The company has a vision of making TV a playable media, a lot of video games. We'll see if anyone's into it, but it's yet another assault on passive media. There's also Netflix had that one show that really hit that was like a choose your own adventure type show, but you haven't heard of any of those formats since then. I feel like it's been your bandersnatch is the one that you're thinking of. Yes. It was it was sort of it was a cool idea. It was sort of difficult to consume because my experience going through it was like I wanted

to actually be told the creator's vision. The best. I wanted to give me the best story. I don't have time to watch this 10 times. Yeah. And then if you go back and you watch it again, then you're watching repeated things. There are some movies that do this really well.

One is called Run Lola Run. And it's this story of a woman who has to deliver, I think, like drugs to a drug dealer or something. She has to run across town or something like that in a German city. And the movie is three scenarios of how they play out differently. And so you watch the same thing happen three times.

And there was another, there was a music video that did a similar thing, I forget what it's called, but it's a cool storytelling technique when the creator of the art decides to take you on this multi-forked path, but they do it intentionally as opposed to putting it in your seat. It feels like you might just be better off just going full video game if you want a true choose your adventure like we have the technology

they'll just let you choose the entire thing yeah we have video games and so do we really need something like in between or do we need something that's more like the barbell strategy where it's a it's a it's a yeah you know anything or choose your own adventure movie feels somewhat NPC coded right where yeah distinct pass you know actually it's you're not actually able to have real effect yeah that you're in yeah yeah yeah says this means TV may soon become another back and forth media everything's back and forth media these days people comment people fave people share people repost

people quote tweet and dunk this is what people like the author audrey meir and sometimes joe mean when we say society is becoming more oral it's not so much about speaking and listening and sounds per se it's about everything becoming this rolling conversation that appears and disappears in the exact same instant i mean tbpn is a good example of this we get a lot of alpha from the chat over here and it makes It makes the show. Saraj told us to bring Vlad Tenive from Robin Hood on the show, and boom, here he is today. So thank you for John Axley to calling that out. The constraints of oral communication impose certain distinct conditions on the mind.

A premium is placed on one upmanship and combativeness per Walter. Thought is less analytical and more grounded in the here and now real world in his famous book, Orality and Literacy. and oral culture simply does not deal in such items as geometrical figures, abstract categorization, formally logical reasoning processes, definitions, and even comprehensive descriptions, or articulated self-analysis, all of which derived not simply from thought itself, but from text-form thought. Prior to the written word, there was no reference material for people to look things up.

So in order for society to preserve important information, it had to be packaged in ways that are memorable, repeatable and viral. This is all totally obvious and familiar to us now in 2025. The irony here of Joe writing this long-form written piece and then us evolving into back and forth media, which he's describing is not lost on me. In his book, preface to Plato, the British classicist Eric Havelock tries to unpack why it is that in his republic, Plato takes shots at poets and poetry. Plato's attacks on poetry is something that apparently bothers a lot. Do we have a sound effect for that?

Taking shots. We're still working on that sound effect. It's getting dialed in. But per havelock, Plato wasn't really concerned with the lyrical art form that today we call poetry. Instead, he was criticizing this world in which the Homeric epic was the primary vehicle of moral instruction.

Education via Homer was becoming outdated in the emerging world of written word. Because the oral world finds it difficult to define and discuss why abstract analytical categories like moral behavior and hard work are good in their own right, moral instruction has to take the form

of children's stories where good behavior leads to better personal outcomes. Here Havelock identifies the problem, what Greece has hitherto enjoyed, says Adamantus. In a passage of great force and sincerity is a tradition of half morality, a sort of twilight zone, at best to compromise.

at worst a cyclical conspiracy according to which the younger generation is continually indoctrinated in the view of that what is vital is not so much morality a social prestige and material reward this sounds familiar which may flow from a moral reputation whether or not this is deserved or else and this is not inconsistent the young are insensibly warned that virtue is the ideal of course but it is difficult and often unrewarding for the most part a lack of principle proves more profitable do not the gods so often reward the unrighteous and immoral conduct in any case can be expiated quite easily by religious rights the overall result is that the greek adolescent is continually conditioned to an attitude at which which at bottom is cynical so he's calling the greek adolescence the adolescence the get your bad culture identified it back then It is more important to keep up appearances than to practice the reality decorum and decent behavior are not obviously violated, but the inner principle of morality is.

Cynical is the key word here, says, Joe, if the point of good behavior is to achieve good personal outcomes, then what's wrong with bad behavior? If that can also achieve good personal outcomes, it's all about outcomes. These days, everywhere you look, you find evidence that success per se is seen as a stand-in for quality. For example, wealthy people are always being asked for their opinions on all sorts of things, regardless of their domain expertise. The moment someone becomes a billionaire, they apparently become an expert on everything

from interest rates to geopolitics to the electricity grid. There is something to this where once you become a billionaire, you can just convene, like you can snap your fingers and just be like, I wanna have dinner with all the geopolitical experts, and then you can kind of recycle their takes or process their takes. So there is something to this, but I agree with Joe's take.

It's a good one. The whole concept of, selling out this notion that an artist might sometimes have to choose between making a lot of money and producing the highest quality art feels completely over as a concept. Incidentally, if you look at this chart of the term selling out in books, it peaked right in 2008 soon after the introduction of the iPhone and the birth of social media and the web and mobile. Annoyingly, there was a major financial crisis right around the same time and there are all kinds of cultural turning points that show up on charts around then. And we are doomed to be arguing for eternity.

about whether it was the phones or the foreclosures that changed the trajectory of history. I think that's a great take. Maybe discussions about selling out were just a luxury of a time when the economy felt less precarious. My favorite thing has to be how products get marketed for having gone viral.

There are viral handbags. There are viral sandwiches, though this place in the East Village closed down and I never got to try it, says Joe. The viral chopped Italian sandwich. Not familiar with that one. There are viral chocolate bar that say it on the label, the original gourmet Dubai chocolate.

And then it just has a seal, a stamp that just says viral. Fact-checked, viral. Fact-checked, viral. Well, if you're designing a new package for your next chocolate bar, do it on figma.com. Think bigger, build faster. Figma helps design and development teams build great products together. You can get started for free at Figma.

It's also funny because viral is something that, you know, happens to to a thing for a specific moment in time, but it's not an enduring trait. Sure, it burns out. So the right stamp would be, this went viral. Yes, yes. Certified viral. Yes, this was the COVID virality take.

COVID was viral. It had a positive viral coefficient. COVID infections were growing exponentially, but by definition, COVID must have a sigmoid function, not an exponential function. And what I mean by that is it's an S curve, meaning that there can never be more than seven billion, eight billion COVID victims at the same time.

It's impossible. It can never be 100 billion cases of COVID because we don't have 100 billion people. So by definition, it has to peter out. And then also, like, once you have, if you're actively sick with a virus, you can't get the virus again. And if everyone has it, then the viral coefficient drops.

And so we were all going to see this sigmoid function pop up. And we did. And we saw, you know, very, very fast exponential growth and then declining. So Joe says, this is funny to me, because in theory, viral is a neutral adjective. It doesn't speak to any inherent quality of the good itself.

Things can go viral for bad reasons. Are the handbags well designed? Does a sandwich taste good? It doesn't really matter. The benchmark of a sandwich is that people are posting about it. Everything else is an abstraction that we don't have the end energy, time, or language to discuss. I mean, this ties to clearly.

Like, at some point, they will be weighted by, like, their G2 rating and their churned. But right now, it's like, it is viral. They have viral market entry. And I would imagine at some point, people ask, is the product well designed? Does the sandwich taste good? And we'll see.

Yeah, and I mean, I went through this with party round, right? We went viral over and over. Eventually, I realized it doesn't matter how many times we keep going viral. Our product inherently has massive churn, and it was valuable for a brief moment in time where companies were raising these crazy party rounds. And then I was kind of well aware

that we were seeing a broader tech correction. I didn't think that every- And then comp that to branded native. Never been viral. Never been viral. I've never seen it go viral on the timeline. I've never seen a stunt for it. But it's grown every quarter of my entire adult life.

It's crazy, yeah. Underrated, underrated, and potentially. a better way to get your bag in decades, not mere days. Yes, slowly. Slowly. And of course, this gets us back to the golden age of grift or the golden age of fraud and why it's all right out in the open. What exactly is the difference between a company that finds a way to sell a dollars

worth of crypto for $5 versus a company that designs the world's most advanced semiconductor? You or I might be able to come up with some story about how, well, you see, one is productive and one actually contributes something material in some way to society. and so the entrepreneurs and investors deserve some reward and so forth. And then someone else will poke holes in this. Are we really better off for semiconductors that make the AI that is breaking the brains of Facebook addicted boomers? Have quality graphics and video games really made society better off? Yes, absolutely.

Haven't you heard about all the people sitting on their couches addicted to looking at their screens? Did that company really do something better for society than the company that made a bunch of people rich with the magic crypto box? I don't know about you, but I'm exhausted just at the high. thought of having to engage in these articles. Life is much easier if we just say that the semiconductor company made a lot of money for investors, and so did the crypto pump and dump. And so they're both equally valid as business ventures.

Disagree. I understand what he's saying, but I will engage in this all day long. Everybody has to eat, right? Who are we to judge? Yeah. Anyway, new and different media forms don't just give us new means of expressing the same ideas. They change the internal logic of the human brain,

and with the return. to orality this endless back and forth of as a pervasive modern condition that that's it for the idea that certain modes of profit are more shameful or and ought to be covered up and obfuscated i don't know about that i i think we are in a we are in a special time i think we are more in a i'm more pendulum-pilled on this issue and i do think that um that warren buffett will return as a a hero and people will be quoting Warren Buffett. Could be Chimoth. And I think that getting back to

getting back to understanding the fundamental value that businesses are delivering will be lauded more. And this is inevitable. It is a product of, maybe it's more of a product of the kangaroo market, of the faster cycles. Like in my early life, the cycle was dot com, and then eight years later, housing bubble and then 12 years later interest rate and COVID and the craziness then but then since then we've had every two years a cycle instead of every 10 years it used to be really these long drawn-out 10-year market cycles yeah but I do think that we will be going back yeah so relevant to this article you have Michael Saylor's strategy down 20% in the past month is at the time when there's a bunch of new crypto treasury companies you know coming to market

market. And then, yeah, I think that there's a lot of people that will defend Sailor and his strategy, but ultimately there's a number of reasons to think that that strategy might be too good to be true, at least if it's done too aggressively. And then we covered Chmoth's back history the other day. And I think that Joe, you know, I I don't want to put words in his mouth, but he might look at Chamoth coming back to market with us back and say that it's shameless given the past performance. But at the same time, every new investment

is an opportunity to redeem oneself. So even though that, you know, SOFI has experienced a real return, open door, not so much, clover health, not so much, Virgin Galactic, down 99% pro-kidney down 75%. I didn't realize that healy down 96%. Some of these specs were with Hito Sophia and some of them were with Servetta.

I'm not exactly sure the difference, the delta there. And then he also did pipe investments. Seems like MP materials did very well. 622%. That's pretty cool. But a lot of this other stuff is down a bunch. Some bankruptcies, some acquisitions. Berkshire Gray got acquired by SoftBank, actually.

I didn't realize that. But at 86% decline from the initial IPO price. Yeah, so, I mean, you were saying earlier, your take is that you look at this, it looks rough, but he probably learned his lesson. And he might be set up for success this time around. Is that the idea? He could have learned his lesson.

He also might not, again, again, you know, trying to analyze why he is coming with a SPAC. The Bucco Capital take is the guy loves SPACs. Yep. He's just having fun. I mean, it is not easy to just set up a SPAC. If it was easy, everyone would just do it. But marshalling $250 million in capital for an acquisition or taking a company public is the domain of investment bankers. It's the domain of the high finance. It's not something that you can whip together over a handshake deal at Demo Day. It requires special set of skills special set of connections and shemoth has those um but yeah i don't know um

there there clearly is another sophie out there there's another mp materials out there there are good companies out there uh the trick is just finding them with more than like one in 10 accuracy yeah um because ideally every every spack should be at least some some growth yeah anyway stacy razzgon says i'm good with the government taking equity stakes for chipsack money as long as we get to hear Trump asking questions on the earnings calls, totally agree. Let's turn it into entertainment. You know, let's make the most of it. That would be hilarious.

Yeah, I mean, I guess he would be in a place to do that if he's a major shareholder. It would be, I don't think it would satisfy the semi-analysis folks to have more government involvement on the earnings calls. Certainly not. Let's get Dylan Patel. Let's get Doug O'Loughlin on the earnings calls. That's who I want. in there. Anyway, if you're looking to automate compliance, manage risk, prove trust continuously, go to vanta.com. Vantas trust management platform takes the manual work out of your security and compliance process and replaces it with continuous automation, whether you're pursuing your first framework or managing a complex program. Thank you to Vanta. Andre says, miss the AI train. AI turns out to be fake. Watch your enemies and adversaries pour billions into a bottle. Trillions? Trillions. This is Europe, I guess? Yes. Okay. It says, do nothing.

win. I think this is a reaction to this idea that the EU had higher GDP than all of China, but I think they already had higher GDP or something. Did you see this? I just assumed this was general AI bearishness. Yeah. I don't know. It seems like you would still rather, like the net present value of all of AI is still extremely positive and you would rather have an extra trillion dollars in market cap in your in your domestic markets if you could yeah but a little bit of a silly post you know maybe you know in a in a non-fast takeoff scenario sure Europeans can use some version of chat GPD we'll

probably literally use chat GPD I am I I I think that the answer I think that the aggregation layer and the application layer matters a lot more than the data center layer it's great to build data centers all over the world you need to have local inference and and low low latency but like if you can't get your populace to go to letchat.com instead of chat.com, like you have lost control over the LLM and you will not win. I mean, you might be able to regulate and put cookie pop-ups and all sorts of different stuff, but you won't have true control over the platform.

Like platform control in the modern era and the internet era comes from aggregation of demand in consumer habits. And that's why Google is dominant in Europe and has not been displaced by the Google of Europe. Yep. Well, speaking of data centers, Oracle will spend over $1 billion per year to power a single data center with gas generators.

Let's give it up for big oil. OCI, deeply underrated Larry Ellison. Absolute goat. Diving in here, Oracle's Larry Ellison used to scoff at the idea of cloud computing saying in 2008 that it was complete gibberish. That's crazy. I don't remember him saying that.

Now the success of Oracle's Cloud Infrastructure Unit is why the company's stock price has soared and made Ellison, its chairman and co-founder, the second richest person in the world. Oracle's sitting at $654 billion on this lovely. He's catching up to Tesla. Yeah, we're going to need. We're going to add an eighth to the Mag 7.

Mag 8. Put Oracle in there. I mean, founder-led company. Good luck. He's been on an absolute run. And he's, I mean, it's crazy. the like where Oracle started and how they're still still conquering in essentially the same market obviously very different technology but yeah I've done quite

well yeah so Oracle a software company that had long struggled to find its niche in this market gained a foothold through scoring some major customers today it's helping power Elon Musk XAI from a data center in Utah assembling a cluster of tens of thousands of AI chips for Nvidia near Singapore and recently inked what is likely the second the largest single cloud deal ever with OpenAI. We talked about this a few weeks ago. This is open AI effectively committing to these sort of massive inference bills years in advance. We're talking tens of billions of dollars. Is this inference or training? I thought this was training news. Models will be trained to there

is what is what Brody Ford says. I was talking about the I was talking about the open AI cloud deal specifically. Yeah. Yeah. It's a move away from Microsoft. which is the underlying the undercurrent here oracle is on the hook for tens of billions of dollars to develop unprecedentedly large data centers amid energy and material shortages shortages that includes a plan to spend more than one billion a year just to power one new megasite in West Texas with gas generators rather than wait for utility connection with all the spending Oracle recorded a negative annual cash flow for the first time since 1990 that's absolutely wild

And questions remain about the longevity and margins of offering infrastructure to train AI models. Oracle, founded in the 1970s, had long faded from tech prominence. Certainly hadn't faded from prominence in things that matter. Exactly. I was about to say. Racing. Racing. So I won't accept that. Having a founder that looks 40 despite being closer to 80. Yeah.

On the road to its return in the AI era were internal battles to convince chiefs. executive officer Safra Katz to invest in the cloud, recruitment of key customers like TikTok and the rise of a brash executive named Clay Magorik. Magork. McGork. Bloomberg spoke with more than 30 current or former employees and customers to understand how Oracle can deliver on its towering promises. They detailed spiraling costs, accelerated timelines to satisfy open AI, regulatory roadblocks,

and the hiring of hundreds of former Amazon cloud staffers speaking anonymously to discuss the inner workings of a famously private and litigious company. Oracle declined to comment. So, as cloud computing picked up Steam in the late 2000s, Ellison had little reason to be excited. Oracle's namesake database, which is purchased outright and installed directly on customer servers, is one of the world's great cash businesses. Adopting a cloud sales model where users rent access to software would almost certainly come with lower profits and a need to collaborate with rivals.

After years of writing off the cloud as marketing, Oracle's tone changed. as its business came under fire. Amazon pushed deeper, cheaper database options on its cloud customers, application rivals like Salesforce, promise easier installation and updates. Ellison saw the need to get Oracle's Fusion apps commonly used for finance and resource planning on the cloud, according to people familiar with his thinking at the time. There were competing efforts through the 2010s within Oracle to build a cloud for internal and customer use, an initial attempt led by Thomas.

Curian, no way. He's the head of Google Cloud now. Okay. Yeah. I didn't realize he was at Oracle before. Yeah. So a separate group made up of largely Amazon alumni, led by Don Johnson, pushed an approach called Bare Metal,

in which clients wouldn't have to share their servers with other renters, allowing Oracle to target privacy-focused customers. The group also focused on building smaller data centers, which let them expand in countries that weren't yet viable for industry leaders. The Bear Metal approach won the blessing of Ellison, who remains a key decision-maker despite handing off the... CEO title more than a decade ago. I absolutely love that.

It's like, hey, somebody else can handle all the stuff I won't. I don't want to do. I'll still handle the, I'll still handle the big ticket. What was that famous Larry Ellison quote during COVID? Larry Allison. I'll keep reading while you find it. The new product came to be known as Oracle Cloud Infrastructure or OCI. Curian departed the company in 2018 after his approach was sidelined.

He then joined Google to lead its competing cloud service and remains in that. position. And there's a chart here, if we can pull it up. Oracle Cloud is expected to be a majority of business by 2029, and Wall Street is projecting breakneck growth. You find the quote? I don't remember exactly what it was, but basically he was just hanging out in Hawaii during all of COVID. But he paid all of his workers, like the full amount when they were in benefits through May or something. They did some shutdowns of the office. but it was just very funny where he was just like, I will be in Hawaii while this chaos is unfurling

and he was hanging out in Lanai. Why have a compound in Hawaii if you're not going to go there during a pandemic? Yeah, it's like the spot. I mean, everyone was out there during that time. When offering the new product, Oracle had to overcome a long-held reputation for aggressive sales strategies.

Major pitches for OCI include cheaper pricing thanks to a simplified set of products and good integration with other clouds. Oracle salespeople often take jabs. at AWS's sprawling set of tools telling customers that paying for Amazon's cloud means subsidizing expensive moonshots like a satellite project. Coupier. Coupier.

Coupier. Interesting. Yeah. I mean, there are a lot of tools in AWS. You don't necessarily need all of them. Some of them probably higher margin than others. It's just funny to hear the internal strategies of the Oracle salespeople putting the screws. You really want to subsidize this, this.

satellite project with your money yeah you really do you even care about this have you even have you thought about it once on the on the you know you were paying on the battle card is just like do you care about satellites yeah okay so during during the pandemic they they landed zoom who needed the capacity interesting they they also got a two billion dollar commitment from uber wow 2023 and then during that era as well they got uh tick talk yeah of course uh owned by bite dance and that was the whole of like if TikTok sells it'll be the Oracle and Oracle will just host all the data and TikTok will be kind of its own company and there's no antitrust

considerations because Oracle doesn't have any consumer facing social media products it always seemed like a weird fit but like a decent fit like not huge synergy but certainly solves the solves like all the security concerns because Oracle's like the most American forever company that's like just you know built American data centers so they landed they landed TikTok yeah that that account quickly surpassed a billion dollars in run rate and then it eclips the rest of the cloud business combined i remember seeing the the cloud bills from uh what was it snapchat i think was paying maybe google cloud like a billion dollars a year and that's on like what 15 billion of market

cap or something so like a pretty significant investment uh i mean storing videos is a lot a lot heavier than storing text and so when they started working with ticot yeah they actually that's when they started getting familiar with building out these more AI-focused data centers. That makes sense because they need to do the inference for the recommendation out of a bunch of GPUs. Yeah, it makes sense. Well, they should also get on graphite.d.com.

Code review for the age of AI. Graphite helps teams on GitHub ship higher quality software faster. You can get started for free at graphite. Internal accolades have flowed to McGork. We're probably just butchering this. Bouching that name.

Where are we? The 39-year-old has rapidly climbed company ranks and reports directly to Ellison. He was one of OCI's first employees after a Senate Amazon and recently relocated to Nashville, where Oracle has pledged to move its headquarters. I didn't know that. Nashville. Interesting. In June, he was promoted to president and is seen by company leaders as a potential successor to his 81-year-old boss.

Do you think he went there because John Fio is out there? Probably. Nashville? Yeah. Isn't who else is out there in Nashville? Didn't Ben, who's the guy from the Daily Wire? I forget. Anyway.

Yeah. Nicole Wishoff was there. She just moved back to San Francisco though. But yeah, a bit of an odd choice, but, you know. Yeah. No sailing in Nashville, right? McGorick says, sometimes you look back and say, I'm not sure that I was entirely qualified at each step of the way. That's the best, though.

It seems to have worked out so far. That's great. Good for him. Those who have worked with him describe him as highly effective and conflict prone. He once told an executive these actions were effing stupid in a room full of leadership. Talk about managing up, according to allegations in 2021 lawsuit. Blunt bosses are typical in a company run by Ellison, who once described as leadership style as management by ridicule. We've been going through all the different Larry Ellison books in the group chat

talking about what's the difference between God and Larry Ellison? Like, God doesn't think he's Larry Allison or something like that, right? Isn't that one of the quotes? A legendary, legendary. We're having David Center on the show soon, and we'll have to get him to do a deep dive on Larry Allison for us since there's so much more to the character, Larry Allison, and the history.

There's that famous book where he gave a writer. You know the story, right? Larry Allison gave, like, biography rights to an, author and said, you can write whatever you want, but I get a rebuttal in the footnotes. So the book is, the book is the writer, like documenting, like shadowing Larry and following them around and the internal workings oracle. And then they'll just be a footnote. And Larry Ellison would be like, I wasn't being too aggressive in that meeting.

They were being too aggressive. Like, this is wrong. It's like a debate. It's amazing. Anyway, Jeremy shared it in something in our group chat earlier. He said with his top guy, this is about Ellis. from the difference between God and Larry Ellison. With his top guys running the day-to-day business,

he was free to do the things he enjoyed. Brainstorm with his engineers. Yep. Re-read, pose, Annabelle Lee, visit Japan, entertain women, buy things, give interviews, and dream. Ah, the dream. That's amazing. Yeah, it was Ben Shapiro, Stefan Siles, says.

And Nate says, move to Nashville for Volta Cafe. That, of course, is John Feudel. latest caffeine. We'll eventually do a live show from the Volta. We need to. The aesthetics are fantastic. We should do that. We should do that show on a thousand milligrams of caffeine. I'm down. The ultimate challenge. Pump me full of it. Straight into the veins. OCI's importance has grown as the cloud has become a bigger part of the company's business. Today about 23,000 employees report up through McGork over the last two years. More than 600 workers have joined from Amazon according to analysis run by Workforce AI,

Amazon's recent five days a week return to office rule has made poaching are easier as OCI remains largely a hybrid or remote workplace. Interesting. Today, the company's biggest driver of OCA, AI is the biggest driver of the growth.

Majority of Oracle's backlog or booked deals are tied to customers training or deploying AI models with GPU-based servers. We've talked to some founders who have said OCI is deeply underrated. Everyone talks about Azure,

GCP, AWS. OCI, there's some good deals there. Open AI is slated to become Oracle's largest customer and has marketed work as the work as Stargate, an effort announced in January at the White House. The companies have struck deals for more than five gigawatts of computing power. That's a lot of power. An unprecedented sum and enough energy for millions of American homes. Work for open AI is happening on an aggressive timeline.

The data centers are targeted for completion by early 2027, with many of the servers running as soon as next summer, according to people, familiar with the plans. Facilities are being designed for training AI models with the assumption that they could also power the application so they will do training and inference. They need to be designed for hybrid workloads because they don't think that they will be necessarily training on an ongoing basis forever. And that at a certain point the models get good enough and then you just got to get them

diffused into the economy. You got to get GDP growing and GDP's not going to grow on training alone. Providing infrastructure for AI, training is generally thought to be a lower margin business than inference because it requires more advanced. semiconductors and cooling exact timing and design details for the opening I I work could still change finding data center developers and power providers to support this project to palatable prices has been a challenge costs for many goods and services have gone up owing to tariffs and vendors capitalizing

and intense demands if you have some power transformers or tents for meta is a buyer a price of tents is going up though yeah you're gonna be gouging them. And so Oracle cash flow has gone negative on the cloud build-out, but just barely. And they assume that they'll be turning. Some other folks. The site Oracle plans to power entirely with gas generation is located in Shackleford County near another Oracle server farm in Abilene, so they're expanding outside of Abilene in Texas. It's being developed by Digital Bridge Group's Vantage data centers and will have a compute capacity of 1.4 gigawatts, making it among the largest known sites. We've seen a couple groups pop up with one gig, one gig clusters. This is 40%

larger, so, you know, significance. But semi-analysis often, there's like, there's different ways to measure power. Like, it's, and people get kind of funky with it. It's like, are you pulling 1.4 from the grid? Is it 1.4 to the chips? And there's like the concept of like compute capacity versus IT power, all these things kind of, you lose a little bit at every single stage. So we'll see where this cluster actually nets out. And we will let Dylan Patel be the final arbiter of how insane this particular buildout is. Part of OCI's popularity with AI firms is its longstanding focus on bare metal servers. This has become the standard arrangement for AI work.

And Oracle was the- Miss Cloud, but made a key decision going bare metal. Early on to go bare metal. instead of platform as a service. It ended up working out. Yeah, yeah. For old Larry. Users and employees will also point to Oracle's networking quality

and willingness to do high levels of customized work. Semi-analysis, shout out Semi-analysis in Bloomberg today. Popular industry analyst listed Oracle Cloud near the top of its rankings for AI infrastructure vendors in March, citing its cost-effectiveness, networking quality, and strong customer service. I should add a category for how aggressive the sales team is. For sure. Battle card ranking.

How much trash they talk about the competitors. Another of Oracle's largest customers is NVIDIA, which uses OCI for internal development and to power its own cloud infrastructure service. The chip maker code named Pathfinder internally rents capacity from an Oracle cluster of H-100 chips in Japan and from a data center being built on Indonesia's Batam Island. Crazy. Big into islands over at Oracle. Oracle is also in talks with meta platforms and XAI for further capacity.

Of course, Larry Ellison and Elon Musk are famous for getting dinner with Jensen Wong and Beni. So, Batam Island is right off the coast of Singapore. Is it beautiful? I'm sure it is. Or is it more like industrial? Should we go? Next vacation? It's very industrial.

Okay. But I'm sure it's so beautiful. Book of Wander. Find your happy place. Find your happy place. Book of Wander with inspiring views, hotel great amenities, dreamy beds, top-tier in 24-7 concierge service it's a vacation home but better folks I don't need to get them to put together the data set the wander data center yes yes I want

wandering Abilene I want to wander in Patam Island I want to wander in Japan wherever that data center is I want to go on the world tour take me to Virginia put me next at WS East take me to visit US East Oracle's cloud business is still orders of magnitude smaller than Amazon Microsoft and the number three provider Alphabet inks, Google, but plenty of room for growth exists. Orders of magnitude, it's a hundred times smaller. That's shocking to me.

I feel like it would be at least within like 100x. I don't know. The market generated almost $100 billion in revenue in the most recent quarter in expanding 25% year over year. The question is how Oracle will fund this development and what it does to the company's profitability. Still, the company hasn't had to borrow money to develop its centers like smaller rivals,

such as CoreWeave, who we've interviewed, founder of. We believe margin will rebound and cash flow will be substantial once they get through this investment phase, said an analyst, I think, an analyst at Bernstein. Oracle is going through a business model transformation that is even more impactful over a shorter period of time. Yeah, it's hard to imagine that these data centers, I mean, we could be winding up in like the dark fiber world

where a lot of these data centers don't get used if like truly there's a major popping of the AI bubble, but this stuff seems to be extremely valuable for a long period of time. And it's hard to imagine a bunch of huge data centers like not being useful to America in a decade. And so he's risk on. Risk on, but not using leverage.

Yeah, not using leverage. It's all coming out of the free cash flow. They have the cash to pay for it. And it seems like he's in a good position. Anyway, you should get on Julius. What analysis do you want to run? Chat with your data and get expert level insights in seconds. You can ask Julius to analyze your data.

Business better. They're loved by 2 million users and trusted by individuals at Princeton, Boston Consulting Group, and Zapier. And TBPN. And TBPN. There is a new leak of a memo from Alexander Wang. Kylie Robeson is reporting that Alexander Wang wrote that super intelligence is coming in order to, quote,

unquote, take it seriously. The company is making major changes. So we can get into this a little bit. Yeah, do we want to have Tyler break down the whiteboard? We should. Or show us what is the structure? What can you tell us about the current structure of Meta's AI efforts, Tyler?

Yeah, so I think that the main thing is that we now know that Alexander Wang is like top dog of AI at META. So we have, I don't know if we can show it yet, But obviously, you see Zuck at top. Yep. And then Alexander Wang reports directly to Zuck. Reports directly to Zuck. And then everyone who works on AI at meta, not just MSL, like Faire, every single org that does AI, reports directly to, well, not everyone.

But they all report to Alexander Wang. Yep. So then below him, we see three more people. We see Jan Lacoon. Okay. And is Yon LeCoon at Fair? Is that his? I think that is still unclear.

We're not super sure. So he was chief scientist. But he was not on the llama team? No. I don't think so. Okay. It's also like maybe he was on the llama team, but then for Lama 4 he wasn't or something like that.

But then so in charge of MSL is Shang Ji-Zao. He was at Open AI, I'm like 99% sure. And then we see Nat Friedman is also there. And then so below them is just these are like the actual researchers who've been poached from various labs. So you see like Jason Way, Lucas Fier, from, you know, Open AI. I think. I think semi-analysis had a funny, funny joke post about this that they wound up taking down. There was something to the effect of, like, you worked at a different AI lab focused on training. They decided that they sold and they said like, this new organization won't be doing training.

And then so you go over to Meta and you work under Jan Lacoon. And then they're like, you're not going to be doing training either. And so it seems like there's a real fight if you're an AI researcher to actually get onto a team that's working on training super intelligence because there's a huge amount of demand for just like, let's productize this now. And there's probably a divide among the researchers on where they want to play in the stack. Do they want to be focused on implementation, applications, leveraging the foundation models versus training and coming up with the really novel.

So internally, they have TBD Labs, which will also be in charge of exploring new directions, such as building an Omni model. OK, and TBD Labs is a subset of MSL or a side MSL? What's the take there? It feeds into it. It feeds into MSL.

OK, got it. And then FAIR will be a quote unquote, innovation engine for MSL's training runs by feeding its research directly to TBD, lab. Okay. Got it. And that's a, uh, according to Kylie, that's a more active role for fair than before. Yep. And then, for publishing their research, giving it to employees. Yep. And so, uh, so how do, how would I comp this to open AI? It seems like, uh, Shenja, what Zhao is sort of the Mark Chen of MSL? Yeah, I think that's probably

head of research. Okay. Head of research. Yeah. And then, and then, uh, uh, has four, at least four, like really key, high-level researchers. Yeah, these are mainly just like the big names that they've got. Obviously there's like way more. Yeah. But yeah, I mean, even at opening eye, it's like still, it seems like there's like a lot of teams there that's like, oh, I'm like, I led O1 research. But then there's someone else who like led reasoning. Yep.

So it's like unclear how those overlap. Yep, yep, yeah. So we don't really know like what the exact comp would be to Open AI or to an Anthropic or something like that. Sure. But so far, the actual, like, MSL core team seems fairly small, at least of, like, public people that we've seen. I remember that there was some spreadsheet that leaked maybe like a month ago that had only, like, maybe 25 names on it. And they were all, like, kind of superstars, so. And were they mostly on Open AI on the various training runs and various research projects, or was this across the entire industry?

No, yeah, it was not just Open AI. Okay. There was a bunch of people. Was this, like, the list that was leaked? No, that was more recruiting focus. This was just like the actual team. Okay, got it. There's more info in the memo about the goat, Nat Friedman.

Friedman. What's he doing? Will lead MSL's efforts to integrate AI into Meta's products. So as everyone knows, Meta's been trying to make things like AI glasses and the Quest VR headset go mainstream. These products have garnered good reviews, but have yet to make up a meaningful portion of revenue. And Nat Friedman, like, it really feels like he might be the best person in the world to do that, because who was the first person to actually make money off of GPT3, it was Nat Friedman with GitHub co-pilot, right?

And so if you think about like, how can you actually deliver value that people pay for at a good margin, which in the meta context, it might be it's value that's delivered for free and then monetize via advertising, but in general, you need to develop products that pass the hurdle rate of like value capture and not just go around doing science projects,

which is what a lot of the research labs are set up to do, and that's fine. But it feels like meta has some real horsepower on the training side. They're gonna be able to build great models, and they're gonna need to build those in and vend those into a variety of products, everything from Meta Raybans to Facebook, the Blue App,

and Instagram, a WhatsApp. And how can you do that in a way that is product-focused? Well, you hire the person that was the first real, like, AI application layer builder. like with github copied me god yeah i mean i i i think this is exactly one thing that's notable so when meta internally announced the creation of msl in june it said that freeman would be its co-lead uh however in the email wang made it clear that friedman reports to him quote nat will continue to lead this work reporting to me

i don't think that that that that's as dramatic as you think it is I mean's just like yeah I don't want to I don't I'm I've been CEO yeah pretty good at it I think I'd rather just focused on on making AI it's such a huge organization there's so much to do I I think that like you could read that as like he's reporting to Alex I think he's close with Alex I think he's worked with him in the past and I think there's a bunch of interesting ways to to to actually go and have a better experience within the behemoth that is meta focused on just implementation of frontier models as opposed to actually having to have the AI researchers roll up to you and then you're a middle manager in between Mark and you're kind of you know sharp elbows with Alex on you know who's doing what where the stuff is allocated it makes sense to just have a rock star training team and then take the stuff that they trained, go implement it. And of course, there'll be some feedback there,

but it won't be... But if you are an AI implementer, an application layer developer, like you don't necessarily need to have the researchers report to you. Yeah, true. Maybe there's like an equivalence to... There's like Google DeepMind,

and there's Google AI Studio, which is like the productized version of the models. The projects. So maybe it's something like Nat is in charge of the, you know, Google AI Studio where, you know, is the deep mind. Yeah, I don't know.

We'll have to dig into how it's sort of. Where's Daniel Gross? Yeah, where is Daniel Gross? We gotta figure out how he fits in. Great question. I don't know. I mean, was his transfer, his trade deal ever fully confirmed? I don't think he's put out a post about it yet.

But it was confirmed that he left SSI. Okay. Oh yeah, yeah. I'll post it about that and said like we are. Yes, so on Daniel Gross's website, it just says working on AI products at Meta. Okay, so it sounds like confirmed. Okay, he's probably still working with.

But who knows? I would imagine he's working alongside Nat, right? They merge. They merge. The merge happened. And it's Nat and Daniel hanging out going around stuff and I in every meta product. We're putting it everywhere.

Putting it everywhere. I mean, it seems like a good strategy compared to, like it's got to be wrangling that problem at Google has got to be somewhat even more difficult, because there's probably a Sheets team. There's Gmail team. There's a Google search team. It's harder at Google because the core search business

is threatened by Gen AI. Sure. And because you can just go on Chat Tributee and have it browse Google for you. Apparently, yeah. But yeah, whereas if you're More existential, right. Meta, you're like, this is incremental.

This is going to, you know, we only want to do things that drive higher ARPU or higher user minutes. How do we keep people in the apps for longer? And it should be very additive on the creator side, on the consumer side. But you should, like a lot of the usage patterns. I mean, when they rolled out stories, it was very clear that they,

I don't know if they actually wound up rolling out stories in WhatsApp, but they definitely rolled it out both in Instagram and in Facebook. And so there's a lot of AI features that you could imagine, even just like those meta AI studio design a character that you chat with. There's no reason that that like being, chatting with, although it's ridiculous to say out loud,

like the Russian girl or whatever the killer app is, I mean, like the bull case is that it's chat with like a helpful assistant or chat with somebody who's an expert in watches or semiconductors or cars or whatever. Like you follow a lot of car content on Instagram. You can now chat with a like the meta AI car expert, ask it questions maybe. It makes sense that that would be vended into WhatsApp and it would also be vended into Instagram and it would also be vended into Facebook. Speaking of watches, have you seen the levels of like. This was a certain really important post. Yeah, this was tips for men.

It was almost the current thing in Silicon Valley. Everyone was talking about this. Yeah, this was flying around group chats. For sure. And the reason is, you know, Tips for Men was giving their sort of a definition here. But to me, this just screams, RM at the top, LP, Pawtech, clearly the GP, AP, clearly principal.

Principal. Rolex, obviously, associate. Okay. And then Cartier, I would say. investor relations okay yeah yeah yeah and then I don't even know when you're getting to IWC range I don't know EIR yeah seriously EIR that had it had a moderate you know an aqua hire yeah kind of looking for their next thing exactly exactly they they define the levels of watches is Richard Mill who of course we've

talked about on the show here as filthy rich pot tech is old money king AP is new money, Rolex is wannabe rich. Depends on the Rolex, you get a Paul Newman. I think you're an old money, old money king. You're picking up a land dweller from the secondary market. Are they spiking? Yeah, I mean, they're sitting well above retail. Bezell has one for 70K.

70K for a landweller. It is a beautiful watch. I like it a lot, but that is a wild price for a Rolex. Wow. Well, yeah, I mean, make a statement. It's a nice bracelet. Yeah, it's a good bracelet. It's a good bracelet, sir. If you're, if you were running a luxury watch brand and you wanted to get your watch brand mentioned in ChatchipT, what would you do?

I'd go to trypround.com. Try Profound.com. So you could get your brand mentioned in ChatchipT. You could reach millions of consumers who are using AI to discover new products and brands. You could even get a demo. I would not be surprised if at least one member of the Holy Trinity already uses profound. I wouldn't be surprised either. I'd be surprised.

Fantastic. Yeah, I got an investor update from James ever found last week, and it was the single most impressive really? One, you know, monthly update that I've received across investing in 60 or 70 different start-ups at this point. Very, very impressive. Shout out to them. What is Reboy talking about here? Keith Reboy has taken yet another victory lap on calling Miami as an under-rate

place to live. It was, of course, not in the conversation at all, and then it became the current thing. Delian famously posted, can we just move Silicon Valley to Miami? He somewhat successfully did that, and a lot of companies moved there. Of course, it didn't actually become like a major tech hub, but it's certainly more of a destination for the tech elite than it's ever been in the past. It's a beautiful place. I love visiting it. Great for conferences. great. My favorite thing about Miami is that if you host a tech conference there, no one will go home after the conference ends because everyone will get a hotel room because almost no one lives there. And yet it's a place where people can justify going to a flight. It's not, it's as

convenient as Las Vegas as like nice weather, lots of activities like Las Vegas. But if you throw a big event in San Francisco, half the audience will be like, oh, well, I'm not, maybe I got a babysitter, but I'm going to go home. And if you throw out an event in New York, same thing. But if you get everyone to Miami, 90% of those people are going to be from out of town. They're going to book hotels. They're going to be there. They're going to be staying up later.

They're going to be having more fun, more networking, more business connections, more value creation. So still bullish on Miami as a place to visit and as techs Vegas. Less bullish on it as like go try and build a foundation model company and recruit a bunch of AI engineers. That's going to be a tough lift. The office visits in July 2025, change from the first month of 2019 is way up. Denver is down 40%. L.A. is down 36%. We're trying to shift that trend by being fully in office.

Alec McGillis, who Keith is quoting, says, really striking to what degree New York has become an outlier in recovering from the remote work shift, especially given that it is a city that was first hit hardest by the pandemic. Huge part of this is that people's apartments and or homes that are actually in New York City are so much smaller so people often want to go to the office. That's a good point. Whereas if you're in Denver or even L.A. or Chicago or Boston, you might live slightly outside the city. You might live in a suburb. Denver's over here. They're still on a hike.

They're still on a hike. They're still hiking. Yeah. So nationwide. office visits are down over 20% since pre-pandemic times. And so July of 2019 is kind of where the benchmark starts before the pandemic hit. And obviously that changed a lot of businesses. It changed a lot of work from home behavior.

We were just talking about Oracle. You know, they're building data centers, but they're doing it remotely. Whereas AWS has kind of gone back into the office. Seattle notably missing from this list entirely. But anyway, this post from Tane is wild. Yes, yes. He's charting out annualized ad revenue by platform.

Google search at $215.15 billion. How much, Tyler, how much money do you think in revenue, Bing brings in every year? $5 billion. $14 billion. All right, that's not too far. That's right. You're off my 3x. If John had asked you about Snap, you would have been pretty close.

They did $5.5 billion. Pinterest is at $4 billion. Uber at $1.5 billion. This is ad revenue, not platform revenue. DoorDash is making a billion on ad revenue. Instacart's making a billion on ad revenue. But meta is up at $200 billion or $186 billion. Google searches at $215 billion. And so, yeah, I mean, like the Open AI, we were talking about Brad Gersner,

kind of saying that, you know, the Open AI evaluation of $500 billion is like way ahead of Google's metrics based on where Google was when they were valued at 500 billion. But when you look at that pool of high margin ad revenue, 215 billion from Google, 186 from meta, 63 from Amazon, and you ask yourself the question of, like, will chat GPT be able to grab a piece of that? Is it already? It's not really already. It's mostly just people paying for a great tool that they prefer over the

other uh over other options um but if they if they seriously get on the in that game with a agentic commerce agentic checkout um and and taking commissions and cuts from different uh revenue streams in the ad revenue world like there is just so much money to be made in internet ads like you can be a company that's not known for advertising like uber and still be making a 1.5 billion in ad revenue and that's extremely high margin and so can Open AI suck 50 billion out of this 500 billion pool of ad revenue and trade at a 10x on revenue? Like, is it possible? It's like, it's not that crazy.

I don't know. Well, getting better and better at serving the models cheaper and cheaper. Yes, yes. Well, as they build out their ad product, they will need to be using linear over at OpenAI. Linear is a purpose-built tool for planning and building products. Meet the system for modern software development, streamline issues, projects, and product roadmaps. If you make software and you're not unlinear, you're crazy.

And if we flip over to the Bayer take on Open AI, Bone GPD says, GPD5 single-handedly destroyed the fast takeoff narrative and killed the stock market. I don't know if that's entirely fair. Killed the stock market. It sells off 2%, and it's like, GPT5 took it up back.

This is the beauty of like the kangaroo market, the faster information is that like. Every time it's so over where you could just a day away from being so bad. It's not just that, is that you, you go through the trough of disillusionment so, so fast. Like you can have like all of the think pieces, all of the memes, all of the hot takes about like, it's so bad, it's so bad. And then two weeks later you can be like, okay, we've clearly hit the bottom, we've beat

this to death, everyone's talked about how we're completely over our skis and like the bubble has popped. And you can be like, okay, now it's time to start reinvesting. we got to start buying the dim and then we start building back up so quickly and that's what happened i mean during covid like it was what like a three-month drawdown even even uh even the the the interest rate post zirp era was like pretty quickly turned around maybe a year of hard of like hard times um it was not it was not the dot-com bubble which took years years years and Tyler crosgrove has uh this is the doomsday clock for us so the doomsday clock uh typically the folks

who are worried about the apocalypse are tracking the doomsday clock the amount of time until doomsday we have been tracking uh we say it's 90 seconds not to age yet it's 90 seconds to nothing tyler can you give us some more context on what inspired this and how you're feeling okay so this is apparently this is like the doomer take on gbt 5 right yeah nothing ever happens nothing ever happens no fast take off okay i disagree okay i think gbd5 was pretty good yeah but how many seconds until aGI in the singularity how many days i mean sam altman put it a couple thousand days three thousand days is a decade right i would put it closer to turn the singularity the merge his six thousand days seven his definition for that was just people become really close friends with a chat

bot yeah yeah yeah that's that's that's uh that's pretty clear uh i mean i guess uh like if there's going to be a fast take off this is going to be some sort of singularity something that's like unpredictable i would peg it more at 7 000 days i would put it at 2045 okay maybe i'm like halfway in between you and sam and sam so sam's 2035 20 40 20 40 okay 20 40 okay so that's a lot of seconds that's a fair amount of second we we go google capital which is basically the the fourth technology brother he says this is a drawdown for ants momentum names with zero valuation support still up 100 to 700 percent year to date several with no revenue, many still getting gunned from the lows back to roughly break even. I don't know when

the music stops, but the palantards and the lemon apes are still dancing. Lemon apes? What are Lemon apes? I think lemonade. Lemonade is meme stock now? I mean, it's up, it's up a couple hundred percent year-to-date. Well, there's another story that is over the last year. That is developing, but we don't have a full analysis of it. So deep-seek versions. 3.1 is out. The model was released on Hugging Face. That correct, Tyler? Yeah. So I think there's basically, there's no model card. Okay. So we don't know like what the benchmarks are really. Why would that be? Why would they release the model without releasing the model card? I feel like that's kind of standard issue. Yeah. I don't know. I mean,

it could just be like, oh, we forgot to add it to the like file. I don't know. Okay. I mean, I assume that they're going to add it within a couple days. Okay. Well, people could do it independently too yeah you can run the benchmarks independently I guess but yeah so far it seems it's kind of up in the air yeah how good it looks some people were like oh china's cooked like you know yeah yeah the chips like totally screwed with yeah yeah they tried to train on wawa they failed they couldn't get invidia like people were saying like oh it was supposed to be deep sick v4 that's what we were hearing for sure yeah and then it turned into 3.11 so bad so it could be sort of like a 4-5 moment yeah it's possible that they're going to

going down, they're mimicking the error in the tech tree that was followed at Open AI and meta, it seemed like. Yeah. Because GPD 4.5 kind of came out and was underwhelming and then Lama 4 Bohemoth couldn't get out and we might be seeing something similar. I mean, so those were both examples of like... Big, big, big. Yeah, that was like big pre-training runs, right?

But Deep Seek already has like good RL because they have R1. That was like, I mean, that was the first using model to come out after open AI. So I don't know if it was necessarily that. I mean, it seems reasonable that it's just like a chip thing where they were forced to use Huawei. But I think we'll see. Hopefully over this week, they'll release some more details about it. Yep. Well, we will be tracking which company has the best AI model at the end of August.

On Polly Market, of course. Google's running away with it. at 93% chance. I don't know if they're already in the lead and that's why, or maybe we're expecting something new to come out, but DeepMind seems to be on a tear. They've been climbing even towards the end of the

year. They're up at 59%. XAI has recently eclipsed Open AI as the second best AI model at the end of 2025. The other news on DeepSeek, this is still in the rumor mill, but

some dude asked the official deep-seat customer service, and they confirmed that version 3.1 is a merge of reasoners and non-reasoners. Maybe some sort of like model switcher coming soon. Both chat and reasoner API now route to the same model, but just change if thinking mode is on. So anyway, if you're looking for sales tax AGI, head over to Numeralhq.com. Spend less than five minutes per month on sales tax compliance at Numeral HQ. Well, Howard Marks just had an interview with Bloomberg. I think it's relevant. He says US stocks are in, quote, in early days for a bubble,

although the critical point for a correction is yet to come. He says, I'm certainly not ringing alarm bells. The point is that things are expensive. Palantir is certainly expensive at 500x price to earnings. It's been 16 years since investors last went through a quote, serious market correction. He added the current period. 16 years?

Oh, he's going back to 2008? Yeah. The current period reminds him of the late 1990s when the market was falling in love with tech stocks leading to former Federal Reserve Chairman Alan Greenspan to warn of irrational exuberance. Still, the market rose for a few more years after that before the tech bubble burst. Yeah, again, like, you know, the debate everybody's been having is are we in January of 2021 or November of 2021? we might just be in 2019, you know? We just don't know. This is a Ben Thompson's take.

Mark says people get out of the habit of thinking about market corrections, noting that a reversion to the mean is very likely. Some technology stocks are, quote, quite highly valued relative to history. No new insight there. This is a time to put a little more defense into your portfolio and investing in credit as opposed to equities is one way do it. Yeah. I saw another post that was it Fidelity was recommending a portfolio of 70% bonds, which seems very, very conservative. But do with that what you will. Let's switch gears

to a different hedge fund billionaire, Jim Simons. His daughter, Elizabeth Simons, has given $250,000 to a super PAC supporting New York City mayoral candidate Zoran Mamdani. Of course, this is seen as sort of antithetical to who Jim Simons was and what Renaissance Technologies did as an applied math hedge fund. Gary Tan has a take. He says, it's a special form of insanity for private foundations to supercharge the destruction of teaching math to the next generation when that money was earned literally by the merit of pure applied math, like the money earned by Renaissance Technologies legalized math, Gary says. Jim Simon's mathematical,

skills helped transform him from a prize-winning academic at Harvard and MIT into a legendary financier whose algorithmic models made Renaissance technologies, one of the most successful hedge funds in history. After his death last year, one of his consequential bequests went to his daughter, Liz, who oversees the Heising Simons Foundation and its near billion dollar endowment. What Liz has chosen to do with that inheritance might have surprised her father. Jim Simons devoted much of his charitable giving to basic research in mathematics, and science, but his daughter's foundation is moving in a very different direction. The Hising Simon's Foundation and similar organizations are supercharging a movement

to remake K-12 mathematics education according to social justice principles. Interesting that both the left and the right are somewhat attacking math right now. Obviously, this is coming from the left, but there's also that attack on USC. Art numbers real? Yeah, UCLA mathematician, Terence. had his funding cut by the Trump administration. And so it's a bad time to be a shape rotator, time to pivot into word selling.

But we'll see how it shakes out. I haven't been following the New York City mayoral election too closely because I live in Los Angeles. Anyway, let's go to this post by Nikiel Krishnan. He says, dude, Mark Burton. Tolini, the ex-etna CEO, now Oscar CEO has an insane story. Here he talks about how after his skiing injury, he was in so much pain for 17 years that he went to Switzerland to end his life and was then told he could fix his pain.

He went through neuroplasticity exercises and got it fixed. So I was getting ready to go to Switzerland to end my life at Dignitas. It's an assisted suicide organization, but I had to prove I had intractable pain and pain that couldn't be cured. And so I was sent to a doctor and the doctor evaluated me. The doctor said I was going to do it on February 15th, 2023 was going to be my death day. I wanted to do the 18th, but it was a Sunday. What was the day I had the accident?

So I went to this doctor and he sat down with me and they did a few tests and they looked at me and said, you don't have intractable pain. You have neuroplastic pain and we can fix that. I go, here we go again. I mean, I did seven days. the Hanaman University Hospital ICU, 50 milligrams of ketamine, an hour IV to try and reboot my system. I had a great time and it felt better for the first month afterwards, but then I came back in a rush. And so I said, here we go again. And I had worked with Mary to get her through

how that was going to work and what the plans were and all that sort of stuff. And so they go, okay, well, let's start. So part of it was cognitive behavioral therapy and I had to go back to my childhood and my concept. I was not well treated as a child. And so I was consistently under threat assessment. And threat assessment is the worst thing you can have when you have chronic pain because you're always waiting for one cell to have pain. And then all of a sudden it goes everywhere. And they said, and also your 42 pain centers in your brain have wired together

from all this chronic pain over the years. So any touch feels like pain. So in essence, I was addicted to pain. And they had done MRIs on baseball hitters. And they said the best baseball hitters, their visual, cognitive, and motor courtesies light up instantaneously. There's no latency. That's why they see the ball in slow motion. That's how they see it moving. That's how they hit it so well. You have a baseball hitter's brain on pain. There's no latency in your system. Something touches your arm. You're in pain.

So they help me understand the system. Then they put me in transcranial magnetic stimulation and they zap my brain for 30 minutes to disconnect those pain centers. And they put me in a virtual reality lab with a helmet and they repatterned my brain. And he got through it and he's doing well. So very good to hear. What a crazy, crazy turnaround. Anyway, Microsoft Excel adds co-pilot AI to help fill in spreadsheet cells. This is like a crazy time. The moment you've all been waiting for the moment you've all been waiting for. But there's been a lot of folks who have been building Microsoft Excel add-ons. We had some of them on the show. There's one that launched on Monday. We didn't have a chance to have the founder on the show. But there was this, the current

copilot instantiation similar to the Gemini integration and just kind of sits on the sidebar, does a little bit, but now they're going to have co-pilot AI in every single spreadsheet cell, similar to that demo that we saw on Monday. Yes, but they warn against using the AI function for numerical calculations or in high-stakes scenarios with legal, regulatory, and compliance implications as co-pilot can give in correct responses. Interesting. Do you think this is a disruptor's innovation or innovator's dilemma problem where there's a low-end solution that is counter positioned against the status quo because Microsoft can't add like a unreliable product to something that is thought of as reliable. This was the take that the legal industry could face

disruption from AI because right now AI is maybe 50% as good as the real lawyer. I don't even No, 80%, 10%. It doesn't matter. The point is that it's a thousand times cheaper potentially. People have gotten used to getting a result from Excel and feeling like they can trust it, trust their own calculation. Yeah, yeah. You know, they don't feel like I need to get a whiteboard out

and whiteboard it out and use a calculator and sort of fact check it. But I think you're going to have to do that with co-pilot and various AI tools for some amount of time. But at the end of the day, you have tools that humans use to do things, but then humans are held responsible for whatever process they use in order to get a certain result.

So I don't think this is that big of a change. Yeah, I mean, fundamentally, Excel is a functional programming language, essentially. Like, it's a bunch of functions. You can't write, it's not the type of language where you can create like a class, or object. It's not object-oriented programming, but it is functional programming.

And what that means is that it's entirely deterministic. Like everyone opens up the same Excel sheet. They should see the same numbers. There is no stochastic, non-deterministic. And that is kind of antithetical to the way LLMs work. Now, to be fair, businesses all over the world have implemented LLMs at various pieces of their tech stacks and been fine with the fact that, OK, for this particular function

call, we get a sort of fuzzy result. We're trying to tag something for fraud, and we're giving it a risk score at the end of the day. And we know that there might be some hallucinations. It might get something wrong. And the tech industry has completely come to terms of that. And they know that these systems are sometimes reliable. Sometimes they're not.

But they add value. And so the fact that Microsoft's actually rolling this out quickly is pretty bullish for Excel sticking around, in my opinion. And the fact that they are warning, as long as the warning doesn't pop up every single time you call the copilot AI and you use an LLM in a cell. I don't think it would be a major headwind, but I don't know. We'll see. I'm not using a lot of Excel these days. But you should be using fin.a.I. The number one AI agent for customer service, number one in

performance amounts marks, number one in competitive bakeoffs, number one ranking on G2. We need an Irish sound effect. world champion. Yeah. And I mean, customer service is a good example of where most of the customer service answers are non-deterministic anyway, because they come from a human. So if you have an AI agent in the loop,

you will still need to escalate and fact check and reality check what's going on. But in general, it's the perfect bit for General of AI. Kyle Chaka has a new essay in the New Yorker. He says, what do all these things have in common? I grapple with the burgeoning Gen Z and younger. aesthetic of tacky, oozy, ugly, chemically augmented, brain-rodded consumer slop, the Labubu, Dubai chocolate, macha, industrial complex. And I'm looking forward to a time when we don't have

to use the word slop anymore. I think it would be fair to at least soon call the top on that. I was really hoping that I just would never need to learn about Labubu at all. And just like, It would just come and go, and I would just be forever ignorant of it, much like you're ignorant of every movie ever created. It's a beautiful experience. It leaves you with a sense of purity that I long for. And yet, today I find myself learning about Labubu. Tyler, do you have a take on Labubu? No, but I have a fun fact.

I'm pretty sure that this is true. The first... This better be legitimately fun, because I really hyped it up. So I think the first use of the term brain rot is Henry David Thoreau in Walden. No way. So like 1850s. Wow. Isn't Walden like literally about touching grass?

The whole point is like you go to the pond? Yeah, he lives at the pond for two years. Yeah, he doesn't talk to anyone and he just like walks around. And he says the word brain rot or rotted brain or something? Yeah, I think brain rot. Wow. Okay. Yeah.

Is that a fun fact? That's a very fun fact. I thought that was fun. I would give that 10 funs up. On a recent quiet weekday morning in Manhattan, I attempted to obtain a Labubu, the cutesy monster doll that has become the biggest international toy fad since Beanie Babies in the late 90s. This is in the New Yorker.

Collected by children as well as by adults, the dolls were created in 2015. I didn't realize it was 10 years old. By the Hong Kong-born designer K-Sing Lung, when they were brought to the mass market by the Chinese toy company Pop Mart in 2019. The K-pop star Lisa started sharing her collection. on social media in 2024 sparking the recent explosion i didn't realize that that's where this all came from the k-pop star um labubu's have pointed teeth rabbit-like ears and wide glaring eyes their faces are in extremities are they're demonic lots of people have been saying that

tie die in the chat says tim delin said laboos are just chinese rudu dolls and yes it tracks yes i i like that post someone was saying i want to pronounce it like it's a greek hero Labubus. Bill Bishop in the substack chat says, my dog Tashi wants a Labubu chew toy. That could be a good use for Labubu. Let's buy Tashi all of them that are available on the market and have a little Tashi destroy all of them.

I love Tashi because Tashi is like a full on character. He's sort of like the Tyler of Sharp China. And Tashi is a recurring character on the Sharp China podcast that you should obviously go, listen to. And Bill, Bill, we're going to, we're buying a Lubbubu for Tashi. Yes. Nick, can you figure it out? Yeah, get Tashi's address. We'll send a Lubbubu. Yeah, don't just get an entry level one. Tashi deserves that. Get the rarest one possible, the one of one, the most hyped. Take it out of the clutches of the most K-pop addicted,

brain-rotted teen who's ready to spend $10,000 of their parents' money and give it to the dog. So their faces and extremities are bare. The rest of their bowl. bulbous bodies are covered in a layer. This is exactly who I want to be covering this story is the New Yorker. The creatures are usually found hanging from phones or handbags. Tiny demons haunting our

accessories and haunting their lives. See? Demonic. You said it, but the New Yorker said it as well. Yeah, they come in a menagerie of more than 300 collectible forms. They can be matched to a personal style or mood. Pink fur for when you're feeling flirty, glowing red eyes for a bit of an edge.

dress be belate scarved for a cozy vibe the high-end art fair art basle released a limited edition art handler labubu a batch of which sold out in 20 minutes i think that tashi needs the uh the art yeah for sure as a result of their popularity labubus is our labubus are uh labubus are difficult to get a hold of often out of stock both online and in physical stores their scarcity made me want one even more perhaps those who own them know something i didn't so i turned to partia a union square boba tea cafe with neon lit claw machines that are perennially well stocked with lububu boxes i plan to win my own tiny monster by skill a friend and i picked up refreshments at the counter sparkling grape yogurt and

an iced green tea with vanilla moose and traded $20 for 20 party tokens, which would allow us to a scant four attempts at grabbing one of the Lubu's stacked and grinning inside their glass cages. This is the Skinner Box. This is fun. I love games. I would probably fall for this. Though the cafe had just opened, you know, the last time I bought. Here's what we need to. We need to make a golden retriever that can ward off the demonic Labubo.

Yes, you know the antithesis of the antichrist-like Labubu. It is the Santa Monica Pier Mickey Mouse or like a, you know, I forget exactly what I won, but I was with my son on the Santa Monica Pier, and there is a challenge where you have to hold onto a bar, like a pull-up bar and then it pulls you up and you have to dangle and you and the longer you dangle the bigger the prize you get and I held on for my life because I was fighting for the love of a four-year-old and I did quite well there are a number of tricks so for the first minute it doesn't rotate and then it releases and then it can rotate freely and so that makes it a lot harder I of course was not carrying my weightlifting chalk like I should have been and so my my hands were a bit

sweaty and I underperformed but I drew a large crowd people were cheering it was a heroic moment something I'll remember forever and so if you're trying to if you're trying to win a toy stay away from the demonic claw grabber and instead do a feat of strength for your child that's what I would recommend so the author tries to try to win one of these he does not and he says why did I feel the need to own one didn't win he didn't win he just decided to cut his losses and go by one Why did I feel I need to own one in the first place? It seemed to be an accessory of lifestyle that I was missing out on

and already late to adopt one constructed of physical goods that have attained. Yeah, it feels very, you're going to be late to the Luboo game if you're, you know, buying it now that we are talking about. Oh, yeah, we are definitely late to this one. One constructed of physical goods that have attained intense online fandom status symbols that are both Instagramable and consumable. Why are they, you know, I don't know. I don't know that anybody's eating their lububu's except for Tashi.

And yet this lifestyle seemed demarcated by objects that were ugly, strange, and uncanny. There's Dubai chocolate, a candy bar stuff with pistachio cream and dough that oozes pea-colored mush. And I don't even have the, we're not going to go into tinfoil hat. You can look into it if you're interested. The Dubai chocolate story very ancient. There's a conspiracy theory there that I do think tracks. You don't have a tinfoil hat big enough. Yeah, for that one.

But you can do your own research. There's macho lattes, bright green, caffeinated beverages that sometimes come out through with a red strawberry syrup resembling blood splashed on a lawn. What is it? I don't like any of this. Anyway, I think the antidote to Laboobo's Instagram. I mean, the main thing is we are far from the Everlane era of consumer goods, right? these sort of dial minimalist it needs to be controversial it needs to be viral it needs to be built for the timeline yes yes yes if you're looking for a physical good get an eight sleep

get a pod five you don't need to go to a claw machine to pick up an eight sleep you can go to eight sleep.com they got a five-year warranty 30-night risk-free trial free returns free shipping does labubu has a have a five-year warranty no does labubu have a 30-night risk free trial no Does Labubu have free returns, free shipping? No. One thing we didn't ask Mateo yesterday when I came on CEO was when are they coming out with eight sleeps for dogs? Yes, yes, yes. And also a third zone for the small child who demands sleeping in the middle and wants his own temperature control.

That was a request that came in during our segment yesterday from the family. Also, timeline was in turmoil yesterday around eight sleep. Delian taking shots at Benchmark. I thought about it. I am incredibly bullish on eight sleep selling in China. I'll give you my rationale. So a lot of Americans are saying, oh, China, America conflict. It's the worst possible thing. The invasion of Taiwan would be disastrous. We need to be, you know, we need to be extremely judicious with the, you know, our frontier technology that we send to China. We need to restrict exports of cutting edge frontier semiconductors, the H20, maybe, definitely not the GB200, definitely not the H100. We'll see. They're not getting Blackwell.

But they will be getting the Pod 5, and I think it's incredibly bullish for world peace, and I'll lay out my rationale. So there are studies that show that aggression, that aggression is deeply tied to lack of sleep. And the Pod 5, as you know, makes it impossible to wake up on the wrong side of the bed. Yep. So if you get a good night's sleep, you are less likely to want to engage in geopolitical conflict.

And so I think we need to be sending pod-fives to the Forbidden City, to Zhang Nanai, to Beijing, to every CCP official, to every PLA official. And making sure they have a good night's sleep, so they wake up refreshed, they wake up feeling good,

and they wake up like, I don't want to go to conflict with America. Maybe Trump should... We can work together. Trump should have America take a position Yes. In Ate's sleep. Absolutely.

And maybe you get on the board. Yes. I think it's a strategically important business for the United States. It's something that we could take away at some point if we did get into a conflict. Yes. And we didn't want them to be sleeping well. If all of China is sleeping on Aitsle. We could cut off the supply.

We can remotely turn it off and say, hey, you're not getting to good night's sleep. Or turn it really hot. Oh, you like it cold? Now it's hot. This is a major geopolitical advantage. Yeah, so right when they're going to take Taiwan, we just crank them up. Yes, exactly.

And everybody's sleeping. No, no. Cancel the invasion. Cancel the invasion. The New Yorker says these products feel hallucinatory. They take the social media mandate of self-modification to its logical extreme, embracing easy, breezy chemical additives and image augmentation enhancing the self-enhancing the self-pills until it spills from its pores. The aesthetic is as much a defense mechanism against the internet era as it is a self-aware and joke. can see what late hyper digital artificially intelligent capitalism is doing to us isn't

isn't it a laugh it's very unnatural looking the cultural critic dean kessick told me describing the dominant visual style of extremely online consumerism it kind of relishes its own artificiality do you know this song i do not i do not what's that song Blake the Man 1000 wrote a song about Dean Kissick it's about hanger, you should go check it out. Anyway, cultural critic. I love Dean Kissick. Any pretense of the pure organic is undercut

by the kind of willful alchemy. Everything is an admixture. The skincare brand road, put peptides in lip gloss, the Los Angeles based grocery store chain, Airwine and Henskis. Like IGF1 in lip gloss? The Wolverine peptide? I'd be down for that.

What else could we put it in? Oh, BBC 157, that's the one. Huge muscular face. Yeah, like that. Airwan enhances multicolored smoothies with collagen and seamoss. Touchland makes outer mist, scented hand sanitizers. And the drug and beauty brand, Hers, produces an ozmpic knockoff that comes in a bottle the color of macha. I did not know that.

As if you're injecting yourself with Japanese tea. I can hear the barista now. Would you like a shot of semaglutide with that? These days, memes are to be injecting. Just it into the body, not just viewed on screen. That's a good line. Yeah, we should move on from this. It's a long article.

You can go read it in the New Yorker and have a deep dive into IRL brain rot and the trend. I want to read this article by Nadia Asperuhov, Delian's wife, who's been on the show. And she is responding to Catherine Boyle's article, the great tech family alliance, talking about pronatalism. I thought it was interesting. We didn't get to it when this dropped, but it's in the New Atlantis. And I guess the New Atlantis is doing an essay series of replies to other essays. I thought that was kind of an interesting format. Anyway, Nadia kicks it off by saying, Catherine Boyle's speech is a sign of a new song making its way through the tech world, one that trills the importance of investing into our social infrastructure, strengthening our nation, and yes, building families.

I agree with all of that. It's a hopeful message. But like tech's early forays into politics which began as a vague mood board of civic aspirations before coalescing into real policy efforts and wins the pro-family cultural shift still has a long way to go and so Nadia is is laying out a new pathway towards pro-family cultural shift in tech this is not to say there isn't a real movement happening and as a parent I'm grateful for it says Nadia Asperov but I feel the gap between rhetoric and reality as I navigate the tech world as a writer and research

particularly when visiting the San Francisco Bay Area. Never ask a pronatalist founder, VC, how many children they have. I mean, you can't do that one in this case because I believe Catherine Boyle does have kids. Of course. But I have long joked that, yes, bro, I will definitely read your 5,000 word essay on pronatalism, but I gotta take my son to soccer right now, so I'll get to it later. There were too many instances of that for sure. dinner conversations still tend to circle around whether children are worth having at all or they treat global fertility rates at arm's length many in tech embrace a borderless lifestyle that implies constant mobility hosting events in cities like new york and austin which doesn't blend well with family obligations children are rarely present at social gatherings i've had the strange experience of bringing my child to events where i'm praised for this act as some sort of pro-family ideological flex which while flattering misses the much less glamorous truth

And with no evening child care available, I didn't have a choice. That's a really, really good point. There's something telling about this disparity. Tech is clearly eager to recast itself as pro-family, but it hasn't yet internalized what is required to support families day today. I mean, I literally just experienced this where I was invited to an event and I was like, yeah, I'd love to stop by. I wrapped the show at two.

I might be able to get there, but I got to be home for family dinner. That's at six. And the event wound up being really far away. I was like, there's just no way I can get there an hour and then get back and do anything meaningful there. And that's just the nature of these things. Like the events are tough. Yeah, I had the same thing this morning.

We saw a friend that he invited us to an event and I said if I go to that, I won't see my family, my kids for like 48 hours. Yeah. Yeah, it's tough. I say good night. Yeah. I see them the next day around five. If I go to something in the evening, I won't see them again until the next day.

Yeah, there is a real trade-off between. Like we have said in America in tech, we work really hard. We also are saying we take our family life really seriously. Something has to give. It's probably the dinner parties and the happy hours, for the most part, unless they're particular. The other thing, I mean, I think a lot of people in tech, you sort of grew up hearing that global warming

was going to make the world uninhabitable at some point in the near future, that was the sentiment. If you turned on the television, that's what you saw. And I just remember hearing, you know, even as a teenager, you know, people talking, oh, I don't know that it'll make sense to have kids, right? If the world is so bad and dark and growing up in coastal California.

My take was always like, no, we need way more kids because they're the ones that invent the technology that solves the problem. The solution is always like more ingenuity, more people, in my opinion. I'm not Thomas Malthus pilled. It's crazy to see Malthus coming back. The Malthusian trap. Are you familiar, Tyler? With the Thomas Malthus, the Malthusian trap. Wait, I don't know the trap. So the Malthusian trap was that Thomas Malthus was an economist 100, 200 years ago or something, and he looked at the growth rate of farming and the growth

rate of the population and was projecting exponential growth in population while linear gains in farming. And his conclusion was that we were all going to starve to death because we would never make enough food. We would never create exponential growth in food production to match the exponential growth rate in the populace. Of course, we did just that. And the number of farmers went from like 90% of the population to like 2% of the population. And although obviously food prices are important and starvation is still an issue. In general, humanity has survived the lack of food. And so it's called the Malthusian trap.

It's Malthusian ideology to be afraid of a linear trend not being able to ever go exponential. And so if you think about like carbon recapture or anything that is emigant to waste heat and pollution and carbon emissions, You track this out and you say, well, carbon emissions are growing exponentially. The temperature is growing exponentially, and our progress on solving that is growing linearly. But all it takes is actually finding the correct exponential solution, which might just be

like exponentially growing nuclear or exponentially growing solar. And then all of a sudden, we're having a very different conversation. Anyway, Catherine Boyle, as a parent herself, says Nadia Asperuhov, is right to highlight pragmatic changes as the scaffolding that's required to build a pro-family culture, flexible work, improving and reducing the cost of education, raising the status of parents, agree with all that. And like Boyle, I believe that tech has the ability and resources to bring this future to fruition if it wants to. Oddly, however, it is tech's unmatched capabilities that might be what's holding it back. Tech is arguably the best place in the world for unchecked

personal ambition to flourish, particularly for young, childless people. You grind and get the $100 million out of your laptop, not a lot of time to raise kids while you're in that process. But this type of environment can delay or disincentivize family formation. My peers in tech, who are reluctant to have children, often express fear that it will interrupt the arc of the careers they've worked so hard to build. That, I think, is the primary tension, not between the family and the state, as Boyle argues, but between the individual and collective ambitions. Both the state and the family ask us

to make sacrifices for something bigger than ourselves. And this perhaps is why they have historically fought each other for mind share. What tech offers is the opposite, a chance to realize a vision that is entirely one's own. Tech worships individual talent. Look at the talent war and the AI researchers that are getting the absolute bag right now.

And it's a unique thrill to live and work among peers who don't shy away from greatness. I agree. But it also means that tech has to work harder than other industries to demonstrate that starting a family doesn't require giving up these ambitions. That case can't be made through vibes alone, as any parent can attest who has spent a sleepless night with a sick child before a big meeting, zooming with one hand while playing peek-a-boo with the other or who has missed a deadline because child care fell through. The answer to this, more secondary sales, more tender offers. If you're a venture capitalist, you're talking a big game about being pro-natalist,

you need to put a couple million dollars into the common, in a tender, and make sure that child care is paid for. What do you think? I like it. I like it. My lead VC, my last company, the second that I told him was having a baby, he said, time for a raise. Time for a raise.

And it was very meaningful. totally important at that at that time yeah um and yeah i mean that that's the if you're an entrepreneur and you're building a company and you're having a child and you aren't going to be able to have access to child care that is a yeah that is a serious leg weights while they're running it's putting an extra 45 on the bench press exactly maybe nine necessary maybe a couple plates on each side unnecessarily you need one of those shirts that makes it easier to bench press are you familiar with this we gotta get those have you seen these yeah that's our new merch drop oh that is a great merch drop so it's a compression shirt that basically

it keeps your arms like this like tight and so when you stretch just taking the weight off you're like 20 pounds and so people do it to get comfortable and like yeah I can't really do 315 but if I wear the shirt I can and then they get comfortable with 315 they do it a bunch and then they can take the shirt off and then they hit 315 and then they can push up so yeah I think that's our next commercial shop for sure for sure there's some big news coming this will be for the for the people in the chat first let's continue with Nadia if tech wants to embody more pro-family values it needs more skin in the game it's not enough to

tweet about population decline or pass around graphs on it in the group chat tech will learn much faster what's required by having kids raising them and supporting each other through the ups and downs pro-family culture means figuring out how to meet the families needs for parental leave affordable child care, quality education, and social environments that are welcoming to children and family lifestyles. Until then, the rhetoric will feel less like a movement and more like a mood. Tech has a track record of moving quickly once it figures out what it truly wants. If the pro-family turn is real, and I hope it is, then what we need next is to move the

discourse from talk to action. Only then will we be able to say it with a straight face that tech is building not just companies, but families too. Fantastic article, Navia. Thank you for posting that. Oh, and if you want to, if you want to invest in the public markets, completely unrelatedly, go to public.com, invest for those that take it seriously. Try to find the translation. Sometimes the anti-transition keeps you guessing. Yeah. Public.com is investing for those who take it seriously. They got multi-ass investing. Industry leading yields. They're trusted by millions. Oh, you want to transition. Why don't you set up an investment account in public.com for your child? Do your own Gersner account.

Tyler, what you got? It was an anti-transition just like anti-metics. Oh, there we go. Whoa. There we. There. we go yeah all these other all these other all these other live stream hosts they think they need to have the perfect transition i keep you guessing with the anti-transition well we have some big big big breaking news Elon has hit the timeline and annie from xAI has new outfits you out so i know so for all the grok heavy subscribers get ready to this is big a little virtual try on fortnight skins for your companion didn't we just say this you were saying that's the way that they'll monetize is that there will be a number of outfits and that the outfits will be on

he's going to say i want a burkin yes i want a lubu-bu i think we just unlocked like the real value of the virtual AI companion economy and all of a sudden i was previously thinking this is a single-digit billion dollar opportunity now the moral stuff is aside like i think me and you are both like we don't love this. And that's the point that Giro Tickets makes here. He says, sir, we need to get to Mars. And I agree with that. I think the efforts would be better spent getting us to Mars and getting us to AGI and solving physics. And I hope that none of that takes a backseat to this stuff. But you got the new fits, Tyler? Do you have the new outfits already? Are they free or do you have to pay? Are there any upgrade picks? There's no in-app purchases yet? They're all

free. No, no in-app purchases yet, unfortunately. Let's hope that one of the upgrade picks is just a donation to the next Mars mission. Maybe put on, instead of being so scantly clad, you could put on a full spacesuit. And then all that money would go to the next Mars mission, which I'm in favor of. But I do think that, I do think that, you know, the Alia Aokta aya-a-a-a-a-a-a-est, I botched that's super bad. The die has been cast. the AI companions are on a trajectory to monetize very well, specifically in price discrimination.

And so this is the brilliance of OnlyFans, and why OnlyFans is so profitable, is that there are both power law creators who generate the vast majority of the revenues, and there are Power Law customers that spend the most money on the individual creators. This is the value of, This is the economic insight in Fortnite.

There are power, many, the median Fortnite player probably spends zero. But the biggest whale on Fortnite is probably spending thousands of dollars. And so that price discrimination, there's going to be someone who is on GROC and talking to Annie and spending thousands of dollars on virtual goods, I would predict. I think that's where this goes. Same thing as the dynamic in mobile games. Mobile gaming is the same whales that are spending hundreds of thousands of dollars. Bringing price discrimination into a category that previously did not have it,

where it was one size fits all, all you can eat. Netflix does not have this. Everyone pays the same price for Netflix, but if there's a version of the product that can ramp up so you're making more money, and this is the beauty of just online advertising, meta, probably makes more money from advertising, advertising, um, uh, aquanauts to you, uh, than, then someone who has lower, has, has lower, uh, pension for, uh, luxury watch shopping. Yes.

Anyway, uh, Dan Nolan says, a guy on Reddit built something I've wanted for ages, scraping public data and putting it together a leaderboard of real estate agents who appear to seriously get prices wrong. And so, uh, I guess you could go and find, the real estate agent who is underpricing assets and then and then go and buy a house from them maybe this is the solution to the housing crisis maybe this is alpha for open door in a bull case for open door open door of course buys and sells real estate and houses and if there is if there's a market dislocation and an inefficiency in the market you would expect financial institutions to take advantage so this uh

real estate's real what you got realestats dot org real stats that's a good having a leaderboard of the just people that miss price assets but and they do it to both directions they over price and they under price I feel like how how how responsible is a real estate agent for mispricing a house I feel like a lot of that's driven by the home buyer like the home buyer might say I know what I'm I know what I got I want three million for my house and the real estate agent is like but you made some really weird decisions in the remodel You have four movie theaters.

Well, people also will strategically underpriced it at listing in order to create demand and then getting over. Yeah, yeah, yeah. There aren't that many people in this neighborhood that need car lifts in their garage. You're like, but everyone wants car lifts. Everyone has four GT3 RSs that they need to store in the plastic. Everyone has supercars in this neighborhood. And they're like, at 1.5 million, yeah, people usually spend 50% of their net worth on cars, right?

Yes, they all should. Get a 1500 square foot, $1.5 million house in L.A. and get four supercars for the next 1.5 million. Exactly. And secure it all with an unsecured level. Well, we have another massive announcement. What's that? Again, I think everybody listening has been, you know, waiting for this.

I'm feeling the AGI right now. I'm feeling the AGI. We've got to update our timelines. Update our timelines, Jordy. Notion has launched offline. Let's go. Let's go. Let's give it up for the notion team.

I actually think this, I mean, this is cool. I mean, I... Chopin wood. I used to use Notion a lot. And, you know, even if you have a small feature update, make it feel big. Clearly, their users are excited about it. Terminally Online Engineer says,

notion is so funny announcing an offline mode for a to do app in 2025 this is the right thing to do don't get distracted we saw this the figma figma launched figma make vibe coding platform super on trend AI stuff and then simultaneously like yeah we improved responsive design no figma site oh yeah sites for sure but also just like minor iterations on you know the the opacity layer and and how how you can implement parallax in your design like you you you can't get lost in the sauce you have to stay on the trend and be using the latest tools and and be on the cusp. But also you can't let the culture of, you know, regular iteration fall by the wayside. You can't, you can't get distracted by the, by the shiny green tennis ball.

Sometimes you have to focus on just, you know, scratching your ear. This golden... We got a post, we got a very low tan post here from Mopar. Two likes. Two likes, 61 views. Highlighting the MIT report that we covered yesterday, 95% of Gen AI pilots at companies are failing. Mopar says, no, babe, your zero ROI is perfect. Big one, scare me.

Yeah, I think this is a real problem. There's a lot of Gen AI companies that have sold in pilots to things like healthcare systems that are not, these are not going to turn into multi-year contracts. Yep. Hopefully a lot of them do. Some of them do. Yep. They're still a business there, but your ARR is not necessarily real. Yeah. We'll see. I wonder the methodology of this report. I wonder what a generative AI pilot means, what failing means. I wouldn't be surprised if a lot of companies are using tools that have implemented generative AI features

under the hood and they don't even really realize that their software is just getting better, but it's probably deeper in the stack. It's probably a little more, I don't know, obfuscated. And they're just seeing like, oh, the fraud detection algorithm that my, you know, ERP uses is a little more reliable. But I didn't like pilot that. It's just like the software I use, the tools got better. The graphics and video games got better. Like, there's not a binary moment. People are hoping for the chat GPT moment of generative AI pilots,

and it might not be coming. We might be on a smoother adoption curve there. Anyway, what else? We have a post here from Julie Chang. Very important. Who wants to own Bill Walton's longtime San Diego estate in the Marston Hills neighborhood, which has two homes sitting on 1.3 acres combined, both homes sit abutting a trailhead seven beds eight baths listed at five million absolutely given it away this thing looks beautiful what else we got here we have is it Vlad or Mark joining Vlad is joining in just three minutes so we'll keep

I'm just posting for my personal account just letting everyone know Alyssa says she's looking for the most performative man in San Francisco yeah what is this what what you explain this Tyler Tyler do you understand this uh a little bit so there's this concept like you're like performative guy right so you can imagine you're going to like a matcha what do they sell match matcha you go to like a coffee shop okay he's drinking matcha he says you have a book with you oh yeah like you with infinite jest on the subway what like you like how you were reading infinite just on the subway that was like a performative thing that you did

Well, okay. And how you were telling everyone about how you're, you know, you're a bit of an intellectual and you read infinite jazz. Okay, okay, you know, let's move on from this. But, yeah, there's like, like intern Michael, he loves macha. He's kind of a very different guy. Cool. Yeah.

Oh, he's performing a guy. You're taking shots? He can't defend himself. He doesn't have a mic. That's not fair. But then, I don't know. Yeah, you have like a tote bag. Yes.

It's like a friend. Yeah, signaling. It's signaling. Yeah. Yeah. Yeah, yeah. I'm just unclear on exactly what people are signaling, yeah. Is it more the aesthetics or is it more like the startup swag? Either way, the SF's performative mail contest will be happening at Alamo Square Park on August 22nd at 7 p.m.

They're putting up posters in San Francisco advertising it. They should get a billboard. They should go to adquick.com. Out-of-home advertising, it easy and measurable. Say goodbye to the headaches of out-of-home advertising. Only ad-quick combines technology, out-of-home expertise. and data to enable efficient, seamless ad buying across the globe. And we have our first guest of the show, Vlad Tenev.

How you doing, Vlad, good to meet you. What's up, guys, good to meet you. Thanks for having me. Thanks for joining. Can you give us a little bit of a state of the union on Robin Hood? You've launched so many different products. Like how do you see the shape?

How do you define? Are you a financial institution? I remember when I first used the product, probably almost a decade ago now, I guess. It was an app, and now it's a company, now it's a business, now it's an institution. What is the shape of the company today, and how is it evolved? Well, first off, our mission hasn't changed. Our mission has always been to democratize finance for all.

And what that means to us is we really see Robin Hood as the defender of free markets. And we're building a financial super app, a platform where all of our customers can custody and hold any financial asset. or conduct any financial transaction. And obviously, it started with stocks, but it's expanded across multiple domains. We have a credit card, which, in my unbiased opinion, is the best credit card on the market. Banking, which is a high-end private banking-inspired offering,

is coming out very soon. We offer, I think, the best retirement account on the market for the self-employed entrepreneur, folks that might not have access to a traditional 401k. So really, we've been on this journey, and we've increasingly been expanding the scope and capabilities of what we offer. Does that mean something like when I think about legacy financial institutions, I think about like an auto loan, a mortgage, like is that coming down the pipe?

I mean, I'm sure you can't comment on specifics, but just like that shape of experience for consumer finance, like what are all the touch points as you kind of plan the next the next phase of growth. Yeah, I mean, the scope is broad, right? Any financial asset, any transaction. We actually a couple of months ago started piloting a mortgage offering in partnership with Sage Home Loans. And surprisingly, you know, I announced that on X and it was probably one of my best performing tweets of the year. I mean, people are, people are really interested in these types of offers from Robin Hood. The focus is really on daily habits, the financial product, services that you use on a daily basis but i think serving our customers well with those gives us

the opportunity to do these one-time offers and you know you can imagine if we serve you well with your banking needs we would be sort of like your first call if you want a mortgage and i think the wrapper behind all this is our robin hood gold program so at first when i launched when we launched this there was skepticism because subscription products never really worked in financial services. But we've seen this interesting thing where someone joins Robin Hood, usually to buy a stock or a crypto. They sign up for Robin Hood gold very quickly.

Our attach rate for day one has gone up quite high. And then once they become a gold member, they look at what else is offered in the gold bundle. And even if they're not ready for that service, like a mortgage right away, we usually are top of mind, if they ever, you know, become interested in something like that in the future. How do you think about services broadly over the long term? I think our generation oftentimes saw, you know, having somebody at your bank, for example,

that you could call and talk to as kind of a bug, right? And then at some point you realize, hey, this is actually a feature. It's actually great to have somebody on the other end that you can call if there's an issue or things like that. It's very different margin profile, right? Yeah, it's a different margin profile. But how are you thinking about that side, and especially in the context of AI, and giving people that ability to kind of have these new ways of interacting with platforms? I could imagine a world in the future where somebody can call their, you know, call Robin Hood and have a conversation with the platform and that person not necessarily even being human. Yeah, I mean, we're already basically there.

You can have a chat interaction with a Robin Hood agent, and the majority of our cases are handled by our in-house AI. And I think people don't realize this about Robin Hood, but we've looked at where we are relative to others in our industry, and I think we're best in class. Like, we're doing very sophisticated things with AI, both internally and in the product through Robin Hood Cortex. The service model has evolved, and I think what it's going to look like in the future is if you're a customer that's high net worth or a little bit older, and we serve an increasing number of these customers as time goes on, I mean, I'm talking to customers on a semi-regular basis who are thinking about moving hundreds of millions into their Robin Hood account. And I wasn't having those types of conversations a year ago. But we have Robin Hood concierge that gives you a high-touch experience. for those types of customers and the aspiration of the AI team is let's just make sure the baseline level of support that everyone gets is world class with like an increasing amount of sophistication and and i think we've been making a ton of progress and like i mentioned already i think best in class in terms of how we use AI how do you uh let's talk about IPOs that's like

the number number one thing i wanted to get your kind of updated thinking on I'm curious how you expect the IPO process will evolve. Obviously, we covered the Figma IPO live at NICI.C. It was an incredible day. It was unique to our industry because it's a product that many, I'm sure, everybody that's listening to this has used at some point or another. But there was certainly a frustration from the retail community, and I'm sure even a frustration from your side, right,

people were able to get into get in at the IPO price, but not necessarily as much allocation as some would have liked. I'm sure you were doing everything, you and the team were doing everything you possibly could to get as much allocation for your users as possible. But how do you think that process is evolving now that, you know, we have millions and millions of investors in the United States that are smart enough to know when they want to get in, you know, and at the which is just a completely different shift from a decade ago. I mean, we have multiple ways of going public with direct listings, traditional IPOs, SPACs, like the landscape's changed a lot and the appetite for these products has changed too. Yeah. So I'm curious, like, what kind of

change you're personally pushing for and what role Robin Hood will play in that. Yeah. And by the way, a lot of my friends were with you guys there. You know, Andrew Reed from Boya. Danny, I believe Derry Reimer. Yeah, index. Yeah, shout out to those guys, early Robin Hood investors as well. Yeah, that's great. Our approach to this, we, you guys probably know four years ago, we rolled out this product IPO access. We started with some companies that were going public in 2021, and then our own IPO had at the time the biggest, or if not one of the biggest, retail allocations of over 20%. And at first, it was kind of a challenge to get companies excited about this. There was skepticism about the value of retail. The companies were concerned that, you know, retail would sell and they wouldn't hold.

And over time, that's shifted to the point where, you know, nowadays, the majority of companies that are interested in going public are coming to us and talking to us about retail. And I think that's an awesome shift. And where I'd like to take that is even earlier in the life cycle. Now we're helping companies and retail get access to IPOs, but can we go to late-stage privates? Can we go early-stage privates? Can we go seed rounds where actually Robin Hood can offer capital as a service to entrepreneurs? And we can deliver a button where you know, you press the button, maybe you issue some information,

and you get capital for your business deposited directly into a Robin Hood account for you to operate. Let's kind of go, could we go through, could we kind of talk through those specific stages and kind of what the product would look like? So on the one hand, late stage privates, over the summer, you had talked about tokenized products that could involve late stage privates. That's super exciting. How are those conversations going? This is such a hot, hot button issue, obviously, companies and CFOs that are worried about, you know, being marked to market.

But it's ultimately something that everyday retail investors want so badly, right? People are smart. They know that they know they can identify generational companies and CEOs and teams, and they want it. So it's going to happen eventually, right? But at the same time, there's this incredible kind of friction at this moment in time in order to get to that point. Yeah. So I started making a public stance on this whole thing with an op-ed in the Washington Post in January. And I think that op-ed was basically universally acclaimed. People got very excited about it. Everyone's on board. But, of course, I'm not one to just write op-eds. I think a lot of people are doing that.

I want to go and do the thing and actually execute on these things. And as it turns out, execution and whenever you're the first to do something, it can be a little bit messy. It can be a little bit unclear. But going back to our mission, we believe in free markets. We want people to own the means of production to the greatest extent possible. AI can be this massive transformative force. And I think it's very, very important to have everyday people aligned with that, right? If you're worried about AI having disruption on the labor market, you could either fight it,

which you're more likely to do if you have no ownership stake, or if you have an owner, you're kind of rooting for that innovation. So I'd like to live in that latter world, and we see a path. We have the technology to do it. We've had a lot of companies actually come to us, and they want to be. be a part of providing access to private markets. And I think at first, there will be a little bit of like hesitation, just like for IPO access. But I think five years from now, we'll be looking around.

Retail will have access. And we'll all wonder why we were so foolish and having such resistance to being in this world. So I'd like to accelerate that. And I'm very motivated to make this happen in a way that. that addresses everyone's concerns, even the companies with the real-time pricing that you mentioned. Totally. Yeah, somebody needed to come in and just rock the boat, basically, right? Like, it wasn't, you know, it seemed obvious that it wasn't going to happen totally organically,

or it has been happening, but in ways that aren't necessarily good for investors, right? like the meme from the last week is everybody's being offered these like incredibly layered SPVs and uh that that just shows that like capitalism is going to find a way to allow this demand to find supply but if you have all this friction it's not going to happen in a way that actually is is good for the demand side and i think this is an incidental i don't think anyone sat around the table and said you know we don't want retail investors 80 percent of the of the market that's unaccredited to not have access to the leading innovation companies of our era. I think it was incidental. In the past couple of decades, it's gotten harder and

harder for companies to go public. There's more process. It's a greater burden. And some companies are just avoiding it all together. And at the same time, the private market's funding environment for startups has gotten much easier to the point where now companies can raise tens of billions, if not more, in the private markets. And I think the outcome of that, the collateral damage, is that retail is not getting access to the leading company in the space, the emerging space industry, and many of the leading companies in the AI industry, which I think is, yeah, that should be allowed to continue. How do you think about offerings, you mentioned potentially at one point having retail be able to

access even earlier stage opportunities like, you know, maybe Seed or Series A. How would, how do you kind of, what's your vision for that kind of product given that a lot of Robin Hood users are going to be, you know, used to to making an investment and maybe changing their mind about it and getting out of it. Sure, sure, sure. As we all know, if you back a company at Seed, you're riding with them for a very long time. And maybe you can make, you know, maybe there's features that would allow you to, to let people get out over time.

but I'm curious kind of what your vision for that would look like. Yeah, I think the interesting point is that the customer and the market are slightly different between an early stage seed investment and a late stage private. So early stage seed investment, there's primary capital. Your market is entrepreneurs that are in need of a capital as a service offering. So whether it's on-chain or off-chain, what I think would be very attractive is pressing a button, putting in some information, and getting money into your business bank account as easy as possible. When I was a seat-stage entrepreneur, I spent half my time fundraising, if not more. And so the time at which your time is most critical and you need to build your product and make sure your business works, you're spending a ton of time trying to fundraise.

So I think it's very, very valuable if you lower the friction to getting capital. You'll get more startups, more entrepreneurship, which is great for the long term. So there's one, if it's a late stage private, your market increasingly become secondary transactions from early shareholders and employees. And I think that's very, very different. And I think any private's offering has to deal with these realities, that you have to have two slightly different customers and constituents. And I think where they failed in the past

is by treating them kind of as one. So we're thinking a lot about this. I think as time goes on, I'll get much more specific. But I think what you'll see is various mechanisms. The way it's going to work is Robin it will get exposure through various means to these assets. We'll hold them in a box very much like how stable coins work.

You know, you get exposure to dollars or treasuries, hold them in a box. And, you know, distribution overseas will have tokenization as kind of a delivery mechanism. And in the US, it'll be tokenization, hopefully once the regulatory environment matures around that. But there's also lots of other means to give access to privates.

Is there a risk that companies wind up like changing their docks to try and push back against this. I remember forward contracts were pretty popular in the secondary market for a while and then companies started saying, hey, no forward contracts, early employees, like you gotta go to us because we have a rofer and we wanna offer that to our investors.

The beauty of a forward contract is. Yeah, yeah, but you know, they, like capitalism finds away, as always. But I'm just wondering if there's other like layers of abstraction that might be more dominant, like they don't have nearly the broad, brand with retail traders, but there's a world where you're slicing venture funds and offering those to retail traders. And then the companies might be a little bit more on board because they don't wind up with a retail army that's upset with their latest product release

or monitoring them. But they might still see the economic upside or exposure. What do you think about that? Yeah. I think all of those are right. I mean, some of those vehicles exist. already and like you said I think we'll find a way I do think over time companies will see the value of this it'll be right now the companies that are coming to us for IPO access see that when you have an established retail base as a public company there are certain advantages right your customers are also active shareholders in many cases They can defend you, they can give you good feedback, but they're a constituency that, you know, companies are beginning to value more and more.

They want to hear from them. They want to encourage retail participation. And I think you'll see that at earlier stages because companies will believe, and I think it's true, that cultivating retail interest early, has a compounding effect as you go public and even beyond. I know this story has been beaten to death, but we talked to Mickey Malca about the round that came together in the middle of the night during GameStop, but I'm interested to hear just about what has changed technically and then financially

and then from a brand perspective in terms of like going through that cycle, making it through, but then just having a lot of folks out there who are like, oh, like I had a bad experience and I'm still holding the grudge. How do you win them back? What's the strategy, both on the actual business building

side and then the messaging the changes that you made? Like, what's the full post-mortem? Yeah, I mean, there's this phrase that trust is slowly gained and can be lost in an instant. And I have validated that that's basically true. when uh when january 28th the the date that will live in infamy and robin hood lore came down we saw you know hit to our nps obviously on social media and across every channel it was abundantly clear that customers were unhappy and we've had to climb out of that slowly over time and i think

there have been moments where we've sort of like gained a net promoter score it's clear that you know we've done good things and we've sort of like accelerated earning trust from customers, but there's no magic formula where I snap my fingers and say the right words and suddenly, you know, you make up for that. I think that it's done by delivering on our value proposition and being sort of like a consistent, trusted member of the ecosystem for many, many years. And it was probably like a year and a half ago where it became clear like okay we've like shaken off and turned the corner and I think we've been we've been on a great trajectory since then with some of the highest net promoter scores in the past four years and customers are very very happy and you know I think

we just have to keep executing there's uh there's the only ways through right yeah yeah that makes sense. As somebody who runs a platform that actually facilitates stock trading at scale, what gets you excited about the potential of tokenized stocks? I think there's a lot of people that are more crypto-native that are very excited about the potential. And they talk about how easy it will be to trade and transition in and out of positions. And somebody might say, well, I can open my brokerage right now and do that today. And so that's maybe a luxury of being in a great market like America. But where are you particularly excited about the intersection of traditional finance and crypto?

And where do you think there might be unnecessary or hype is overblown? Well, I think that in the same way that stable coins have become a great delivery mechanism, for U.S. dollars outside the U.S., tokenized stocks will be a great mechanism, probably the dominant mechanism for U.S. shares being delivered to retail outside the U.S. Inside the U.S., there is benefit going from 24-5, which we offer through Robin Hood 24-hour market today to 24-7, as well as self-custody and defy applications. I think we haven't scratched the surface for what those can be yet, but as the regulatory environment matures, I think there's a lot of really interesting potential. And it's also the cost of

operating because more and more of what's traditionally been applications and, you know, centralized third parties run by humans, more of that in crypto is being replaced by software. So you have, you know, transfer agency payment processors clearing houses all of this is just now in software and what that allows us to do is lower the cost and eventually if you lower the cost enough the value gets best packed to customers so i view it as you know the next stage and the technological evolution of financial services going from you know pen and paper filing cabinet to mainframe to cloud and then blockchain infrastructure is the the next stage in that yeah yeah it feels like there's this like almost barbell emerging within robin hood where you are going like more individual expression

the ability for a single retailer retail investor to buy a single share in a pre-IPO company that's like an incredibly high agency thing to do and then simultaneously you recently launched managed investing, which feels like at the opposite end of the scale. And I'm wondering if you see this more as, is this like a funnel where people move from one group to the other? Are these distinct groups? And I'd love to just hear more about the managed investing product. How's the business going? And how that, how that weaves into the rest of the landscape of the product you're building. Yeah. I think the end state is going to look less like people graduating from self-directed trading and active trading to, you know, retirement and more passive products,

and more that customers are going to have multiple accounts. Sure. So you'll have your discretionary self-directed account on Robin Hood. You might have a joint account with your spouse. You'll have your retirement account, and some of those will be passively managed, and others will be actively managed by yourself. And I think that as we've gotten deeper into understanding our customers, we see that it's less two different groups of people. Even the active traders are interested in retirement products and sometimes have an even larger bucket of their capital that is managed on their behalf.

And so that's why we've been focusing a lot on the customer experience and the technology front on serving your broad financial needs. how has your approach to running the company changed having been in the game for over a decade now i can imagine in the earlier days when markets were ripping broadly there's all this activity i'm sure it was easy to get kind of caught up in the hype a little bit and i'm sure now i would imagine you've you've you've kind of adapted to try to stay as level as you possibly can when, you know, we've been joking around on the show recently, counting up, you know, you certainly need more than 10 fingers to count all the different top signals. So how do you, how do you kind of stay even keeled, even when markets are euphoric and wild in so many ways?

Yeah, I mean, it's much easier to stay about your wits when things are improving, right? Even though it can be challenging, I think when markets are going up and everyone's looking at, you know, increased stock prices, whether it's our employees or, you know, investors, we just like to tell ourselves we shouldn't get complacent. We've got a huge opportunity in front of us. The job's not finished. And then, you know, at the same time, in 2022, when interest rates went up and, you know, our stock traded below $7 a share. who was trading basically at cash value. You have to tell people that you have to make sure people aren't discouraged. And they think that there's a wonderful future worth fighting for, both outside the company and the environment and also here.

So you go through enough of these. And I think we've been through multiple waves of ups and downs. And I'd like to think I've developed a little bit of a wisdom about it through experience, right? I started the company writing all the code or a large portion of it myself. And, you know, you sort of evolved with the company. And I think I've been fortunate to be part of ups and downs. And I think now I just, I enjoy all of it. You know, bring it on. And each one is a learning experience and an opportunity to kind of like develop some more tools in the toolbox. Totally. Can you give us an update?

on Harmonic? I was about to ask. Oh, yeah. So Harmonic is building mathematical superintelligence, and what that means is we want to build something that can solve math problems at a level exceeding the best humans. I don't know if you guys were math people in your school days, but we actually recently I dropped out of differential equations yeah that's where I topped out differential equations are hard and very useful but yeah we'll have machines doing them for us so thank you I appreciate that um yeah essentially we developed a model called Aristotle that has gold metal level performance on the international mathematical Olympiad, which is a very difficult test. Off-the-shelf AI models like GPT-5, GROC 4, all the things

that you can use don't do well on this exam at all. So this is one area where humans still do very, very well relative to the AIs. And the reason is when you have a very difficult mathematics problem, it's not just like computing big numbers, right? It's, you know, logical, difficult challenges that require a spark of genius and actually require you to take nine or ten correct logical steps. And if you're an AI model that hallucinates, if you get one of those wrong, the result is done. So what you have to do is build a very strong way to verify the output of your AI model, which means that you have to control hallucinations and you have to make sure every line or piece of output follows logically from what happens before it.

And we think that this is going to be a new paradigm in AI models. And it's a little bit different than what everyone else is doing because nobody's really tackling the verification problem. And more and more of our software code is going to be written by AI. And we're in a future already where the job of an advanced software engineer is no longer to write code, but it's to like review code that's written by AI. And as that becomes more voluminous, you know, the humans reviewing it is both a very sad existence for our top software engineers. Also impractical, you're not going to review hundreds of pages of stuff. So Parmonic has figured out how to solve this problem. And I think the applications are beyond just math, but any domain

where accuracy is critical from computer software. Yeah, well, I'll give you an example. So copilot, they've added the ability to add copilot to Excel, but then they had to add like a heavy disclaimer that basically said, don't rely on this,

don't rely on co-pilot for anything important because we make mistakes. And I think that hallucination. And now you have to double check all of your spreadsheets and all the calculations in them, right? And yeah, I think it's a big, problem not just for spreadsheets but you know think about control systems for autonomous vehicles and all of this safety critical code in order for AI to be

used to generate it we need to solve this hallucination problem did your team find problem six on the IMO as difficult as everyone else it was this combinatorics problems seemed like everyone was struggling with it are there any glimmers of hope for solving that or is it in Is it some sort of wall that we've run into? Yeah, and what are your ambitions for next year with the IMO? Are you guys going to take it? Go for the perfect score?

So we had, we had proofs for five out of the six problems. Formal proofs that didn't require humans to verify. We did not solve number six, even though I was really hoping we would. But yeah, it turns out that the solution to that problem was a tiling. It was a tiling problem. problem. But the solution was the exact tiling used at the floor of the Sunshine Coast Airport in Queensland, Australia, which is where the IMO was held this year. So the human existence had an advantage. They all walked through that airport. And they were given the answer. Interesting. That's a

fascinating piece of lore. Thank you for sharing that. All right. So next year, have a humanoid taste all around the city of the location just scan to the context window the the full iMO contestant experience context window is important oh next year for sure problem six and problems like that we'll definitely uh will definitely be yeah i mean the the the pressures the pressure will be on for you guys because it's the main it's the main thing you know the other labs can be like well we we do math but we're really a consumer yeah no this well i don't know I mean, once you have the gold medal, I guess the perfect score is a big accomplishment, but I think our sights are a little bit higher.

I think we're interested in kind of two things. One is solving an unsolved problem in science and mathematics and actually contributing to the state of the art in one of these quantitative fields. Like the Riemann hypothesis, if you guys are familiar. Navier Stokes, same thing, right? If we could solve that. Navier Stokes is I'm less excited about because I'm more of a theorist. Sure.

But Riemont hypothesis would be good. Yep. Also, just delivering this technology to individuals and corporations in a form that they could actually use. So I think there's lots of things coming. But another IMO gold medal maybe isn't top of the list. Last question. Did you give Terence Tao a call? Oh, yeah.

To bring her over to Harmonic. We were riffing on this on the show. We were like, who should give him a maxed-out contract? Yeah. What are your thoughts? So I don't know if you guys knew this about me, but I was a math PhD student at UCLA, and I actually went to UCLA to study under Professor Tao. I had no idea.

Crazy. That's amazing. I know him very, very well. Yeah. Fantastic. Well, yeah, I hope you have some good outcomes there. Yeah, I was joking. If you're saying, it seems like he does great stuff.

I had a non-traditional background starting Harmonic. I got a math PhD. That is fantastic. Well, thank you so much for joining us. Great hanging. Appreciate the updates. We will talk to you soon. Have a good rest of your day.

Cheers. And we have Mark Cuban joining the stream. We invited him on after him and Jordan got a little timeline in turmoil debating AI advertisements. We have a lot more news on the. front of AI ads. We have more news on what Meta's doing with AI. We have more news on what Open AI is likely doing in the world of advertisements. We're going to debate that. Welcome to the stream, Mark. How are you doing? Good guys. How y'all? What's happening? Thanks so much for

taking the time. Good to meet you. Where should we kick it off, Jordy? Do you should dive straight into the debate over artificial intelligence and advertising? Sure. Maybe you could set the stage for us. what set off your alarm bells, what triggered your initial worry about this idea of ads in LLMs? Because this isn't the internet, right? It's not just a normal digital platform. It's a platform that, depending on how it's trained, depending on what pre-prompts you put in, it could be very manipulative. And there's not really age limitations at all.

not really any limitations whatsoever. And normally I'd be, let's just be laissez-faire, right? The market is the market. But you've already heard, you know, of stories of kids going down these rabbit holes and, you know, other people being told, you know, to kill themselves and you just don't know what can happen. So if I, if I build a model and it becomes popular,

even if it's only a niche model, right? Just like there's head space and there's calm, Let's just say I build the calm AI large language model, and I have millions of millions of users, and I have an advertiser who sells Xanax or sells whatever, right? And they're trying to get more sales, and I need the money. I can easily, easily train this thing

to manipulate people into doing things we typically would not allow people to do. And that's my concern. And so if we just want to put up, you know, just little ad, traditional graphics, JPEG ads, all, you know, put them into the chat list on the left hand side, great. You can do all the display ads you want. You could do video there all you want. But if it's in the response that comes back from the model, boy, you're going to have lots of problems. Yeah, I think, I think Sam Altman said something to this effect saying that artificial intelligence will be superhuman at persuasion before it is.

truly super intelligent. It will be very good at convincing people. So it is reasonable. What do you think of Sam Altman's latest commentary on how Open AI might get into this world that the actual LLM interaction, the chat would not be monetizable, but if it made a recommendation to buy a product,

and then you said, hey, I want you to go check out for me, it sends out your agent. It's already doing that, right? And I guess the referral fee, is that okay? Yeah, it's already doing it. You know, it's, you know, it's one thing to have the model itself convey and try to manipulate. It's a whole other thing when there's a search query. Yeah.

Right. We get a lot of traffic from OpenAI chat GP for costplusdrugs.com. In fact, I've used it because sometimes if I want a price for one of our drugs and I don't want to take the time to look at the latest price list, I'll just put in what's the price for, you know, Deripram, whatever it may be. and it's right there. And so yeah, of course they can extend that. But response is a whole, and models are smart enough to know what the difference between a response to a query versus influencing and engaging in a chat.

I guess the question is like that. Yeah, I think to double down on what you're saying, an example, if you're going from search, which is people coming in with a specific intent and maybe doing some product research, you have ads and you have you know organic listings or web pages that's one thing but if if various AI models are seen as trusted advisors if you compare that to a situation if I asked John what kind of car should I get and John starts giving me answers and saying like I think you should I really think

you should get this car it's really nice and then I buy it and then later I find out John was getting a 10 percent kickback i'm like i hopefully i like the car but if i didn't what are you doing you know and this happens in a business context too you might you know people get in hot water all the time because they're taking referral yeah in this particular case it's really easy just like you know there's you know a emoji for um sources or just says sources you could put a dollar sign just to show they're being compensated sure sure and do you think that needs to happen at like the FTC FCC level or are you do you think i i don't know the legal convention of it and not you know hopefully it's self-enforced but you know there's the idiots and assholes

who don't self-enforce sure and particularly for medical stuff i mean does it's easier to chat gpt about your own personal medical situation than it is to find a doctor to talk to sometimes but does that call an example you gave matter because uh like i i imagine that there'll be a power law outcome here and yes i could set up a search engine that serves that serves ads and doesn't disclose that they're But how am I going to take market share from Google? People are going to go to Google, and Google does say when it's an ad. And so, like, as long as the power law winner is a good actor, we kind of get a good outcome. There's also an interesting thing where there's this self-enforcing sort of positive effect,

which is if people rely on chat GPT, for example, to help them do product research and buy the right products, and you buy a bunch of bad products in a row because they're just pushing the product that they're getting paid the most, Eventually, I do think that consumers are smart enough to realize, I'm not going to use this app anymore. I wouldn't agree with that, Jordy, because I think people are primed for misinformation these days. You see it in health care continuously. You know, you saw it with COVID vaccines. People under deathbed saying, I wish I had taken the vaccine, you know, and you see it now with, you know, raw milk, where now there's more people who have, you know, there's examples of people who have died. And people just don't care.

Yeah, yeah. You know, they just go on and maybe they'll say, you know, chat GPT is woke, so I'm using right GPT. Yeah. And that's because those are the kinds of answers I want because, you know, there are people who want to be influenced and want to be part of a group when it comes to the product decisions. Just like we saw the anti-bud light and that kind of builds and you see, you know, pro right

wing products. I just don't know that it is an efficient market enough where people. people are going to take responsibility for just making a bad product choice and then going to another source. There's just so much personal identity and how we use technology. That's part of my concern. How worried would you say you are about AI broadly? I think over the last few months the industry has woken up to, you know, a year ago people were kind of laughing about AI safety, right and thinking about these fast takeoff scenarios now I think people are kind of waking up and worried about the general well-being if you just give hundreds of millions of people you know

unlimited access to these tools you know they are going to there there is going to be some effects some people will be good some people will be bad but but what's your what's your high level read well it's changed a lot we went from fear of the terminator yeah to fear of being influenced in ways we didn't expect because they're such good communicators right we can't talk to other people or we feel you know shy or not open in communicating with other people experts or friends or otherwise but this is our best friend who never gives us a hard time and depending on how it's program will complement what a great question Jordy what a great that is a really interesting approach so

a lot of things to be concerned with their particularly because AI is not smart. Yep. Right. AI is just statistical right now, and I'm of the mindset that that's not going to change for a long time.

You know, one of the reasons that you don't see full self-driving cars that are just everybody using no matter what is because it's easy, there's so many adversarial things that can happen to a car. You know, we have an Australian,

many Australian German Shepherd or a million Australian Shepherd, right tux and about six years old i trust tux at an intersection to know when to cross before you know that he's never been to before before i trust a car and that's the whole point with a i because they're they're just rules and laws and latencies that they that it can't account for it's all text some graphics some video but it's always behind and then that's part one part two I think we're going to see a groundswell in how intellectual property is dealt with. A groundswell change in how IP is dealt with because there was for a long time it's been publisher parish.

Get your stuff out there, get it into journals, make it available so that you can present yourself as being an expert. Well, the minute you do that right now, it's going to get absorbed into training data for these models and you've lost everything you've just created. create it well what if I want to what if I'm taking the side of big raw milk and I want to I want to get people and so I should just write as much as I can that's what you're going to do do your people are going to use bots to try to influence like the robots dot text for a you know for AI you can you can structure it in ways where you can set up sites where you can tell it exactly where to go you know tell it all why raw milk is amazing right but the bigger point is

AI doesn't understand death. AI doesn't understand pain. AI doesn't understand context. AI doesn't know what happened two minutes ago. It doesn't know that there was a plane crash as it's about to tell you or something happened, right? AI can't tell you why that ball fell off the table

unless you tell it, you know, this ball fell off the table, what happened next, right? It's just not smart. And as long as it's not smart, A, can be influenced, and B, you're just not. going to know what it's going to do next because it can't it doesn't have judgment so what would you tell the folks at open AI and the other foundation model labs on how to structure their business it feels like a firewall between there needs to be some sort

of truth-seeking organization that's focused on on delivering the highest quality results and then on the flip side you have a monetization team no I mean you can't check for quality that's impossible yeah of course you can you like you can you can always like benchmark these things or just like vibe test them with the with the with the yeah but you know Jordie was given how did you know how I was given jordy shit online yeah yeah but what I'm saying is like is like Google Google does try and try and deliver the highest quality search results for a particular query and then separately they have an ad auction

function that that ads is an ad platform and those two teams are separate and so like if your age if your age is showing up as one of the those like knowledge boxes on Google, you can't just pay to have them change it. Like that's a separate business line and it's a separate team and they are separate products in the UI. Yes, they exist on the same page, but they're separate. And that's fine, right? I mean, to me, the bigger questions are what's the value proposition for AI as we understand it today, or at least as I understand it today, right? I don't see AI getting smart. I look at AI and

And I think it's the world's best library. Let me explain it in another way. We all have that one friend that remembers everything. Yep. Everything, right. Hey, what did we do that one day back in college? Remember when, you know, our one buddy, oh yeah, this is da-da-da-da-da. That's AI.

It'll remember everything. It'll give you the, you know, if you give it A, B, and C, it'll figure out D, E, and F, right? But it doesn't even know X, Y, Z exists, just like you're right. So it is just like the world's biggest library. It's just like a meeting of the minds of just regurgitation. And so knowing that, then you have to, there's going to be so much competition between the models. That is the biggest driver right now in terms of revenue generation, right? Because there's not, there'll be five, six, whatever it is, foundational models before there's consolidation.

But beyond that, there's going to be millions of models. models millions of millions of models and every brand is going to need a model particularly like in health care like if you are Stanford medical right if you are Mayo Clinic if you're MD Anderson you're not gonna just you know put out all your IP from the doctors and researchers and scientists your pain so that chat GPT can absorb it and have the benefit of all that knowledge so it remembers everything that that all your doctors and scientists did you're going to keep that to yourself. And so in terms of the business models, these guys are going

to have to start making decisions. Are they going to start paying a lot of money for content? Because as much as they're investing in the technology, they've reached a lot of limits, right? You don't, you're not hearing about, wow, these guys are getting to do these new topics that I had no idea that they could cover. They're paying for a ton of content, to be clear. I mean, they pay Reddit, they pay the New York Times. They pay all sorts of all. yeah we had we had a group reach out wanting to buy our back catalog yeah i was like i assumed you already scraped it but think of it if you're i mean let's talk about from the government perspective

sure so they just cut all these NIH grants right all this stuff that presumably went and created new drugs which they have right foundational research basic science right all this research yep if the government really understood AI they'd be like okay we're going to keep on investing in this research, and then I'm going to make it available to the biggest bit, the highest bidder whoever gets it in their model. Privatize it. I like that. Make some money off of it.

Not even just to privatizing it, but monetizing it. Monetizing it. I like this. This is good. Make some money off of that nonprofit research. Are you? That's the way things are working right now. And I don't have, honestly, I don't have a problem with that at all if it gets us more solutions,

But or do our own, you know, the government doing its own model and making that available for a fee. Yeah. Those decisions from a business perspective that all these models are going to have to make. Otherwise, how do they keep on adding more training data? Because there's no way to synthesize all that shit. You're not synthesizing, you're not creating synthetic data

that all of a sudden is gonna, you know, you could tell you give it all the backstory you want that you're a doctor, that you invented this, that you did that, it ain't gonna invent what the doctor and the scientists are going to invent. Yeah. At any point during the AI hype cycle so far, did you think that this time might be different?

There was, I would say, a year ago, the common line was, this isn't like the internet bubble because there's real revenue. These companies are ramping revenue to hundreds or billions of dollars of revenue very quickly. This is different. This time is different. Meanwhile, and I wouldn't lean on this too heavily,

but MIT had a report this week saying that 95% of Gen. AI pilots in the enterprise are not turning into not creating real value. I'm curious what your read has been. I've been through every single technology, you know, event and evolution, and this blows them all away. Now, how you implement it in business is a whole different issue. Like literally, when I was 24, I was walking into companies who had never seen a PC before in their lives and explaining to them the value and having these guys going, well, son, I got this receptionist right there. I got that secretary.

I'm never going to need that shit ever, right? And but then, you know, my business then was helping them figure out how to implement it to give them an advantage. There are going to be integrators that particularly young kids, like when I'm telling my kids who are 15, 18, 21 or 1921, and kids going in school, what should I do? What should I do? I'd be like, AI research. Learn all you can about AI, but learn more on how to implement them. in companies right because to your point companies don't understand how to implement all that right now to get a competitive advantage you got the head

of Microsoft saying software is dead because everything's going to be customized to your unique utilization right or usage who's going to do it for them particularly small to medium sized businesses there are 33 million companies in this country 30 million of them are solopreneurs right single-person enterprises There are millions of companies that have one, five, 10, 50, 100, 500 people that aren't going to have AI budgets, aren't going to have AI experts. This is where kids getting hired coming out of college are really going to have a unique

opportunity. If you're spending your senior year in college right now, your senior year in high school even, whatever it is, your excess time, and you're learning the difference between SORA and VO, and you're learning how to do all this video, you're learning how to customize a model so that then you can then walk into a company and say I understand your business as a shoe company selling shoes at a retail store or selling and selling shoes online let me show you how to benefit you that is every single job that's going to be available for kids coming out of school because every single company needs that there is nothing intuitive for a

company to integrate AI and that's what people don't understand yeah we hired two we hired two we hired two interns this summer at the end of the last school year because they just built products instead of saying, hey, here's what I can do. They just showed us. They took a day and just built something. We said, that looks pretty good. They went to chat GPT or perplexion. Yeah, yeah. Well, the bear, the bearer case, John was joking about this, though. I thought this was interesting. We had one of our interns built this product. It's tbPN.com slash guess. It's this guest directory transcript tool. And he built it in a day, but then he had to spend the whole summer improving it so that was that was a that was a bull case for

software engineers still having a job but you don't even have to be a software engineer right you just have people are afraid to ask the models the right questions they're afraid to ask complex questions because they just presume that it can't they can't answer kids coming out of school today that are fearless in the questions they ask and the follow-ups and their ability to prompt they have more skilled in everybody in every major corporation with under 1,000 employees, right? So I completely agree with this.

That's jobs for everybody. This feels like you're making the argument for putting ads in AI and keeping it free so that kids can have access to frontier models and then go and explore, learn, implement things at businesses. If all of a sudden you can't get in the game, you can't even interact with a cutting edge AI box.

Mark's saying he's cool with display ads. He's cool with a Laboo showing up in the sidebar. Yeah, on the side, my chat. That's fine, but think of it, Okay, there's a death war going on with the frontier models. Yes. It's zero-sum game in their minds. Not all will make it.

Some will get consolidated. Maybe one goes out of business. Right. And so for the next however many years, however long, there used to be a time when Excel costs $499 to buy a spreadsheet. Now it's free. You know, it's not free, but like, basically. Yeah, Google Sheets, right? Google Docs, et cetera.

the basic models are always going to be free because of ads like the reason Google Sheets is free is because of Google's ads business when was the last time right now no you don't but but the reason that they can subsidize is because they have this amazing ads business over here that throws off so much cash they don't care about monetizing it yeah but in the case I mean to to to take Mark's side please I mean a subscription product also subsidizes a free product sure that that's exactly right so you're gonna have to your right free your college your kids version three and those those those

versions are going to have more constraints because they know high school kids you know seven-year-old kids are going to use them so there'll be all kinds of limits build in yeah but then you get your $20 version and chat GPT is doing what $12 billion annualizing growing quickly yep that's insane love you know lovable all these guys were just crushing it and it's like I was the first investor in a company called Synthesia, which does, you know, talking avatars, I don't know if you know these guys. Cool. Yeah, they're killing it. That's great. Killing it's just up and to the right. Yep. You start them off with, it's just a whole freemium model, right? That's been around

forever. And I think that's going to happen. But as, you know, we talked earlier about buying IP, you'll see things go into different directions. So you'll have a chat GPT slash healthcare. And if you want that, it's an extra five bucks a month. You'll see chat GPT programming or math or foreign language, dual-lingual version, right? And it might be an extra 50 cents a month or a dollar a month, whatever it may be. And then there'll be, you know, entrepreneur version and it'll have all the integrations into all the states so that you just, you know, fill in these forms and you're incorporated wherever you want to be incorporated because all the agents will do all the work. All that stuff you can upsell. yeah and so but if they're not using your model in high school they ain't going to use it in college

if they ain't using it in college when they go for that to that company they're not going to use you and i think that is a big deal but i can't say it enough all these people we're in a transpit transition period right now for kids coming out of college whether you have a computer science degree or not but you're not trying to go to the big company to get a computer science degree, probably not the right way to go. Going to any other company who has no idea about AI but needs it in order to compete,

there'll be more jobs than people for a long, long time. Because there's gonna be two types of companies in this country, in the world. Those who are great at AI and everybody else. And this is not, AI is not intuitive. You're not gonna take a 40-year-old who's worked at a company for 15 years and say, go play with chat chief people,

and figure out how we can improve our productivity and improve our processes. Some people will put in the time to learn it, but it's not intuitive to pull all those pieces together and extend them with agents and have the agents start doing things, and then writing software, unlovable or whatever, and having all, it's going to be intuitive

for digital natives, Gen Z, who are going through school and graduating with that, that is going to be jobs left and right. For sure. Totally agree. wanted to get your we were just on with Vlad from Robin Hood and yep my guy is he's super excited about getting everyday investors access to great private markets for great companies in the private markets wanted to get your general read on that you've obviously been part of shark tank for a long time you imagine if you were watching and you could be like i want to invest that

seems extremely yeah and a lot of people have taken crack sure people have pitched you this I'm curious because you obviously you you I can I can see you being yeah it's great when company when if retail can get into the next Figma but there's you know not a lot of making a I've been anti um not sweat equity um crowdfunding right crowd equity programs against it because there's no liquidity people love a company the next Figma and they put in their life savings because they know figmas going to the moon baby and they can't they can't get out yeah and they got to wait that's the problem yep and so that's part one to the problem part two and more of a system systemic problem there's just not enough IPOs i mean it's like watching some of these ipos they're like

meme coins now bam they take off and then it's musical chairs to see you can get out the last but first right yep and if you don't get out first or at near the beginning you're getting crushed, you know? And so is there a way, whether it's tokenization or other approaches to that, probably, but it's going to have to go back to the future where somebody is going to have to take some risk and be a market maker. If Vlad or whoever is a market maker so that there's always some liquidity within X percentage of the last trade, great. Then everybody can do it and everybody's protected to a certain extent, as long as they're not doing deals

where the people are just out and out lying, right, or misrepresenting it, at which point, hopefully the CFTC or the SEC, whoever happens to end up in charge. It's not enough just to bring access, you also have to bring liquidity. Last question, if Donald Trump runs for a third term, will you run for president?

I mean, it's easy to say yes right now, but that's probably the only thing that could make me really reconsider, Because otherwise, I don't want to do that shit. It's not my dream to be president. I'd rather argue with you guys about this. Yeah, it's my dream when you come back on the show. You'll be too busy if you're in the one house.

Last question for me, are you excited about the American taxpayer potentially taking a position in Intel? Oh, interesting. You know what? It's a great question, Jordy. So you're sounding like an AI. You're sounding like an AI.

Yeah, you sound like right. You know what? That's a great question. What you don't know is. I have chat GPT listening. Yeah, yeah, yeah, yeah, he's running clearly. It is a progressives dream. This is the Bernie Sanders dream, the AOC dream.

And I'm not saying I agree with it, but if you think about it, it's asking for equity and taking value from the billionaires before it even makes them billionaires or goes to the billionaires. So when you take 10% of Intel, first let me add the fact that it's a grant that they're converting i think is awful because it was meant to be a grant and that was the deal the united states of america made and now we're going back on the paper that we signed as a country i think that's bad but generally if this was okay we'll put in more money in order to take and we want 10% of intel obviously they can say yes or no

just like invidia and amd had the option to say yes or no on the h20 chips just like material whatever MP um had the odds yeah to give a politician politicians have gotten so good at trading stocks maybe we want them running our federal balance my no you don't i'm kidding i'm kidding yeah but if you're going to generate if i if i was running right and i would say don't don't trump did the same thing he got this one right now the only question is will he do it at the right time because would you i rather take more money from taxpayers the average person who might need to pay more or even the billionaires the oligarchs according to Bernie would I jack up their tax rates the 30 from 39 37 to 39 or 41 or can I just take it this way right take it

before it even gets to them this a progressive's dream I don't understand why aOC and Bernie aren't shouting to the rooftops and Elizabeth Warren yes yes yes and make you know make Donald Trump's head spin around in circles along with every other supporter because those guys if they got excited about it he might reverse course yeah of course why they're being quiet because they don't want him to reverse course this is 40 maybe that maybe you're you're both side the aisle everyone's playing yeah i mean but don't you guys agree isn't it just like a progressive dream yeah like and you know so tariffs which is just like the greatest sales pitch in the history of sales pitches when you can convince 30 plus percent of people in this country

that that tax that they're paying with increased prices isn't a tax, somebody else is paying it. Amazing sales job, right? So now that's $360 billion towards the deficit and everything. And if you can start doing these other deals that aren't piggish, right? Meaning they're fair to the companies that are involved and they're not across the board like tariffs

and start banging down on the deficit in the way that is the ultimate progressive approach, he's turned into Bernie Sanders. he literally has you know only get a better salesperson uh you're great at this i mean i give him credit though i'm not knocking them right i am giving donald trump all his flowers because he is he is doing things in a way that the democrats aren't smart enough to figure out to have done themselves yep this is great uh thank you so much for joining we'll have to do this again soon yeah we got to do this again soon we got to find a new uh new topic to argue about but

This was fantastic. Healthcare. Let's go healthcare. I get, wait to you hear my shit with healthcare. Okay, yeah, let's do it. Let's do it tomorrow. Well, we'll email you. I'll see you soon.

You got it. Thank you so much for joining. Appreciate it. Take care. Up next, we've been keeping and waiting. We got Caser Yunus from Clyde. Welcome to the studio. Do we have him?

I want to ring the gong preemptively. I don't even know if we have news, but I'm just excited. Oh, there he is. We haven't talked to you since. We talked to you at Hill and Valley. How you been? What's new in your world? Sorry to keep your waiting.

We had to... My world. We were arguing. Hill and Valley seems like a lifetime ago. It really was. There's been like four other iconic DC tech crossover events. I have yet to make to many of them. But it was a fun time.

And we appreciate... Hill and Valley is the only one that's worth it. So I think that's fine. I mean, it used to be at dinner. Now it's an organization that throws like some of the biggest and most impactful events. a fantastic crew over there. Shout out to them. But anyway, this isn't about Helen Valley. This is about you. Welcome to the stream. How you doing? I'm doing great. I'm doing great. You know, following up Mark Cuban, I couldn't really watch the thing. I don't know if it's going

to be a, this is the, this is the, you know, the slow letdown to the end of the day. No, no, no. Yeah, we're working on being able to feedback the show to you so you can watch it while you're in the waiting room, but we're sorry to keep you waiting. But give us the update. And I mean, maybe for those who are new and maybe hopped on during the Mark Cuban segment, if you could introduce yourself in the company briefly and then go into the news, that'd be great. Yeah, for everybody who's not in the Bay Area ecosystem,

my name is Kassar Eunice. My, and the company is called Applied Intuition. We are a, now is a late stage company. We earlier this year raised a series F, I got my numbers correct, led by Black Rock and KP at 15 billion. The company is broadly, there's a couple of unique things about the company. One is we've been historically profitable, which is super rare. We've preserved 100%.

Yeah. That word probably doesn't get thrown around a lot with AI companies. No, no, no. We talk to a lot of folks with high revenues. Gross margins not there yet. Hope it on some. Very low, very low gross margins. If you can never be bragging about any of this stuff,

because, you know, it creates great fodder for when you fall. Oh, yeah. Yeah. Like, you know, every bull cycle, I think, like, maybe I should start playing around with hubris, maybe this time is different. I think hubris, it might be fun to experiment with, but it just never, it never works. But the three things that you want in a late stage company is, you know, things like profitability, but you also want high gross margins and you want high growth.

And we've been fortunate with a triple-digit growth for basically the history of the company and then high-growth margins. But that's the finance side for all the people who are like engineers or technical people watching. We're a AI company that focuses specifically on vehicles. So the broad category we talk about is vehicle intelligence. It would be a subpart of physical AI. Sometimes you know you might hear Jensen or somebody talk about that. This is, I think, the most pragmatic and real part of physical AI right now. Humanoids, I think, will come for sure.

but uh but in terms of like monetization it's cars trucks tanks that's a business that we're in and we bring AI to those systems so uh it's it's in a bunch of different we have dozens of products and all this stuff you know i won't get into it but yeah take it through the the market structure because you have uh waymo no consumer product whatsoever you have Tesla vertically integrated i they i mean they had a mobile i deal a while ago i don't even know if they have mobile i anymore pretty much vertically integrated. I drive a Cadillac. It's a product of Kyle Vote over at Cruise. They bought Cruz. They were thinking about getting into the self-driving taxi market. They kind of pulled back from that, but they have Super Cruise. Pretty great system.

And then you got George Hatz with comma, the bolt on, but what is the shape, all the OEMs, they need a play here? How is this going to play out in kind of the vehicles that most people see? We can go into the defense side later, but just in terms of what the average American season. No, Marie, they're coming for it. They're coming for it all. Yeah, I mean, you just said it like GM's been a long customer of ours that you're using is built on our tools. Let's go. Thank you.

Our business is one where we are a supplier to the broad ecosystem. Sure. Of the top 20 global automotive OEMs, we say 18 out of the 20 use our tools, but in a fact really honestly, everybody does. And so that's our play. We're like the, you know, I don't want to use the, like, it's a very, it's a very, like, a risky analogy, but we're the arms dealer in this ecosystem. Okay, okay. Yeah, give me a little bit more context and shape of like what the product you're actually vending in is

because there are physical cameras that need to go on cars if you're going to do a self-driving system. There's also some sort of foundation model, I imagine, that gets trained in a lot of data. There's data aggregation. There's all sorts of, you know, some part is going to be in C++, plus, the other is going to be an ML, like, are you doing an end-to-end system? Like, what's the shape of the product and how much is, like, solutions versus just like the packaged up software? Yeah, so historically, what we announced yesterday and why we're talking is historically, we've been a tools manufacturer, we've been, as an we have engineers, we make tools that engineers use to build these systems. Sure.

The companies you know, you're talking about. Then we got an operating system. We still, that's a huge part of business. But a while ago we got an autonomy, but we got into autonomy directly, like literally making the autonomous systems. That's in our words, that's the algorithms, the models that run vehicles. We've been in it for defense. We've been in it for commercial trucking.

We do L4 trucking. We're running driverless trucks right now in Japan as an example. So we're already doing that. What we announced yesterday is an L2 plus system for automotive. Okay. So it's specifically, it's kind of like, you know, the average person would know Tesla FSD. It's like that, except it's one that you can buy from us. And so where we fit in the ecosystem is we're like, so I come from the car business. So I went undergrad to the General Motors Institute. I used to work in Cadillac in the Cadillac building as an example.

You're John's hero. You're John's hero. I love it. I love it. Yeah, the car business is an awesome business, by there. If you ever want to just nerd out in the car business, we can. It's going through lots of changes. But one thing to understand, the industry structure of the car business is historically, the car business one is a kind of like defense where you would procure all this technologies in OEM from other parties. What's changed now is those OEMs are like Tesla has shown. You can actually verticalize, do a lot of this stuff yourself. And you kind of need to do it because these systems are way more integrated with each other.

It used to be a bolt on a mobilized system. And then that would give you lane keep and adaptive crews. But when these systems are much more sophisticated and they're working with the other functions within a vehicle, you need like a white box solution. And so our SDS product is a white box solution. And what I mean by that is, you know, access the source code, agnostic to the silicon. So if you're buying, you know, like an Nvidia system or if you're buying a Qualcomm system, you're going to use Nvidia and Qualcomm chips. So we, being just a software supplier, we can ride on different silicon. And then on the other end, where you're talking about sensors, each company has a different sensor strategy.

But the broad summary of passenger, the car business is, it's a cost business. And so all of the, all the OEMs basically want to have the cheapest sensor suite they possibly can. Like, even more fundamental question, why can't we get all the Waymos tech into the passenger vehicle? It's because all the way to the compute that's being used, it's just very expensive. And so other like feature, quote, unquote, of our self-driving system is it's embedded. which is another way of saying it runs on automotive grade silicon, which is cheaper and has all these other things that you need for automotive grade products. How are the OEMs reacting to the latest version of Apple CarPlay?

I saw it roll out in an Aston Martin SUV. From a consumer perspective, it seems awesome. The new CarPlay takes over all the dash, so even the volume control will be handled by CarPlay. But it feels like if you're an OEM, you're kind of giving away. You're letting the fox in the head and house potentially. but yeah exactly what's the reaction been and then what does that mean for your business basically yeah i think so so let's look at a gear shift you're that's that you know we go from autonomy to now just let's say

the in-cabin software experience for us we call that business line vehicle OS it's sure it's something that we build and sell um the the punchline there is the issue with carplay is if you're a mercedes and you're in your experience is the same as a Chevy bolt which is the same as let's say asked Martin. You know, OEMs are really good at two things. They're really hard of their businesses. Two things have to get bright. And if they get it wrong, they ultimately end up going bankrupt. The first one is just managing the cost side of the business. Supply chain, getting all the suppliers wringled. So they put all the parts in a factory to, because the factories is big fixed cost. And it pops out at a certain rate. The economy actually moves up and down at pretty

significant, you know, consumer, car sales and consumer index are very, very connected. So all the global OEMs are extremely good at forecasting what they need to build where and when years in advance. The other thing that they have to do very well is brand management. And what it, like more fundamental question, what's a brand? Like fundamentally, what's a Mercedes brand? It's the collection of experiences you've had. That's what a brand is. And so if the collection of experiences you've had is with Apple CarPlay, that does actually degrade your brand. And so the OEMs are extremely sensitive. I mean, I think maybe a controversial. thing to say. I think we've seen peak

car play and peak Android Auto has already happened. I mean, multiple OEMs have gone out and said that they're not going to do car play in the future. They're not going to do Android Auto in the future. And by the way, Tesla doesn't do car play in Android Auto. The emergence, you know, the lucids, the rivians, they're all

similarly. They build their own user experience. So I think that's a tough business to be in. Now, if you're Google or if you're Apple, your consumer brand has to be in that interface. If you're applied intuition, it doesn't. We're a B2B software supplier. So we can make the same thing that CarPlay and Android auto do,

except we can do it in a, again, white box. And I view the self-driving system much more like seatbelts or airbags, where all I care if I'm driving a Mercedes or Cadillac is that I survive and I'm safe. And I don't care where I do. People talk a little bit about the driving style of a self-driving system. And a Bentley might be a little bit different than a Chevy. But in general, I feel like it's something where I'm very, I would make the selection based on the benchmarks. Like what are the incidents per vehicle miles traveled?

What is, how do you see the autonomous driving landscape evolving over the next few years? A lot of people talk about this like two horse race, Waymo and Tesla. But using the arms dealer analogy, it's like Tesla and Waymo or nuclear war. And you come and you're like, hey, I'll, I'll go. give everybody nuclear weapons is that this is not the time to make jokes about my Pakistani heritage yeah we'll skip that but but is that is that is that really your play here is basically leveling the playing field yeah absolutely and I would take issue with a two two horse race I mean you got to remember it's more so I'm talking about that in the

context of oh you're going to be able to just like you know why would I buy a test a something other than a Tesla, if I could rent out my Tesla when I'm not using. There's a section of the market that's excited about that, but I can imagine. I think that future is to be determined, right? And so let me, let me answer the, there's many, and this is such a vast area. We spend hours on, but let me tackle each of those individual points first. For the first one is, is it a two horse race? Absolutely not, I mean, you talk about Super Cruise just earlier.

Every manufacturer globally is absolutely building some version, of an L2 plus system. We're working with a partner like us. There's, without exception, the smallest manufacturers that you know are doing that. A good petri dish of you seeing how this will unravel is China. China is this kind of like swalled off ecosystem separate in the automotive industry. And there is no dynamic that says a winner take all will be effective.

And I'll do the 10 second pitch on why I think an SDS from us would be better. We're taking data from all geographies from many manufacturers, And not only that, for many vehicle types, like off-road, defense, et cetera, and our models, therefore, are just will be and already proving to be more performance. So there you could have a pretty plausible technical view that actually the two legs are maybe the early entrance, but when everything being autonomous, it's going to be a, and there's just no winner-take-all dynamics there. And then in terms of like the broader, what happens is autonomy next five to ten years, like this is the autonomy moment. It's happening now. And when you're in the Bay Area, you kind of live just maybe, you know, Paul Graham used to say six months into the future.

Maybe we live three months in the future. But you do live a little in the future. And you hang around in any street corner on San Francisco. You'll see Waymo's after Waymo, after Waymo. And then you'll start using them. And you see them eating at Uber's, you know, market chair in terms of, right, so like, that's absolutely going to happen. Pass, and what that's doing is, is getting the public use to this concept of self-driving.

We, in the tech industry, are very comfortable with it. A lot of us are Tesla owners. A lot of us use FSD, so we're comfortable with it. You go to Michigan. I'm from Detroit. You go to Detroit. People don't know any of this stuff. And forget, and Detroit's a car town.

You go to Tulsa, you go to, you know, Dallas. It's just not what people are talking about. So I think that in the next five to 10 years is the general availability of autonomy. And so if you want to use a good analogy, mobile, we're in like 2008, 2009. If you're in the Bay Area, you saw that the iPhone is coming. People talk about Waymo's, but most people like, so when does mobile really hit? Mobile kind of hits in like, you could say it hits when WhatsApp or maybe Uber or maybe Instagram, like Instagram you can't even think of before mobile.

And it requires an app store and acquires a front-facing camera. So, like, when will that self-driving moment happen? It's happening now, but I think the next two to five years. I'm not just saying, I'm not just pitching my book, by the way. I don't believe this. Like, I think the next two to five years is all driving. It's going to be massive. It's like the area of AI that everyone, I think it's just because it's not, you know,

the hype happened 10 years ago. Yep. So everyone wants to talk about LLMs and they want to talk about humanoids. But it's like, this is the thing where it's, you know, when we started the company, The reason we're called Applied Intuition, by the way, is we want to be on the applied side of this technology. You can spend many years on the research side. It's a subtle dig in the name. Yeah, like SDS, the reason people ask us, like, especially engineers who, you know, working or interviewing with us, they're like, well, why don't you get into like this space like four years ago, but number one, transformer boom, you know, and the change hadn't, like, the technology just wasn't very good.

But also now, if you get into it too late, then, like, timing is a really, really, really. really important thing. And I think like we always wanted to see, hey, when are we exiting the research phase of self-driving? And when are we entering, and the applied phase is to be very direct for folks who are not, is when it becomes an engineering problem. And now the engineering problem is just about cost, cost, cost, cost, cost. Like, you guys are not asking me, is self-driving real? Like that conversation in 2015, that's maybe the first question is like, is this like a real thing? I know it's real. I want to know when will self-driving be available in a konexick when will it be in the next baniwira when will it be in the next mcclaren because this is

san francisco lives in the future everyone there's already driving p1s uh what uh staying gtbs you're talking about for the people who don't know conig zigs are which like by the way they make like six a year right these cars aren't even crash tested they're so they're so infrequent Ferrari more of a mass mass car well it i think it's a while but i'm challenging you Sell your product to Coding Seg. Get it into a coding seg. I'm throwing down the gauntlet. We have, you know, we have a large and public relationship with Porsche.

They're big shareholders of ours as well. Yep. We deal, like I said, with all the OEMs. I never want to expose any particular strategy. But if you think about it, if you're from a buyer perspective, if you're looking at a Tesla Model S, what's the other thing you look at? You look at Tacon. Sure.

And a lot of times, so like I think even the more exotic companies that, are focused on driving dynamics. You just have to think about this technology of good UX in the cabin and safety systems that prevent you from getting injured, I think it will be like table stakes. By the way, A.E.B, another like a subtle revolution that's happened in the car business

that people don't talk about is the automatic emergency braking. Oh, yeah, it's crazy. It's like statistically making an improvement and like passing pedestrian deaths. Oh, yeah. That's wild. Things that often can talk.

talk about. So I think even the highest end stuff, right now everyone talks about EPA and emissions stuff. I think in 2035 and going forward, it'll all be just like, hey, why are we still having deaths? Yeah, totally. And then that's the Conexie question. It will come up as like, hey, it should be aware enough. It doesn't have to drive, but it should be aware enough to take over from the driver when something really bad is about to happen. Well, thank you so much for last question. Just curious, we're we're keeping a series E company waiting just to talk Yeah, what I was going to say, when, how do you think about, you know, financing the business in the future? It feels like I'm sure, I'm sure many, many SPAC sponsors would be begging, but you, I imagine we'll take the more traditional path.

How do you think about, you know? Yeah, we've preserved 100% of the capital we've ever raised in the company's almost taken. So, so I, SPAC is definitely. Hit that gong, John. Hit that gong. Yeah, yeah, for the, for the finance folks at home, they know what that actually means. That is, that is no easy feat. Yes, that's big as no, back is not, I can, there's many things that I'm specular about

SPAC is definitely, I can tell you affirmatively we wouldn't do. Yeah, you know, we fall into the very, I mean, it's not random that fidelity and Blackstone and, you know, Franklin Templeton are investors in the company. I think in that way we're very traditional. And the way we're not traditional, we're a very hard tech company. I mean, the stuff we build, there's virtually no other companies that. so yeah the future I think the future is good you know how are we going to spend the money I mean or how do we think about capital allocation I'm all of our values the

companies values can be reduced to radical pragmatism if we had to we had to raise a billion dollars to get into some specific technical area or fight that we think is worth fighting for we do it like it's like pretty pretty straightforward that's fantastic well congratulations always great to talk I was I know I know well you just hop on next week Yeah, we can talk for hours. This is awesome. Thank you so much.

Have a great rest of your day. We'll talk to you soon. We have been keeping Elise AI waiting, but we will let them in from the Restream Waiting Room. Some big announcements today. Good thing. We warmed up the gong because we got a big deal coming into the TVPN, Ultra Dome, from the Restream Waiting Room.

Hello, how are you doing? So sorry to keep you waiting. Sorry to keep you waiting. On your big day. I was doing it. I was learning stuff. The previous guest was talking about cars and we went down a whole rabbit hole, it happens. But thank you so much for taking the time.

Would you mind kicking us off in the introduction on yourself and the company? Yeah, absolutely. I'm Minna Song and I'm one of the co-founders and the CEO of a company called Elise AI. And Elise AI is a company based in New York City. We build AI agents that automate the entire customer journey for two verticals, the housing industry and the healthcare industry and we've we just raised our series e today so that's yeah yeah we raised a 250 250 million dollar there we go congratulations can you give us can you give us a quick history of the company we heard from a friend uh what he gave us a general read on your

revenue ramp and it was pretty mind-blowing so i would love to kind of kind of get the the the historic history of the company since this is the first time. Overnight success. Yeah. Yes. Just started yesterday, vibe coded too. No, we, yeah, we've, we've started 2017, started with my co-founder, Tony, who's the CTO. We met in college, studied computer science, both software engineering backgrounds.

I went to MIT. He went to University of Cambridge. But we, after college, shortly after college, we wanted to, um, build a company, build technology for industries that serve fundamental human needs. And that gave us this idea that we wanted to, we wanted to go into housing. And housing is our largest expense as humans. And we thought it seemed like it had limited technology as an industry. We didn't really know too much about it, but felt like a good place for two technologists to start investigating. So when we got started, I took a job working at a real estate firm in Manhattan. And that

was just sort of a research opportunity. I worked at the front desk. I answered all the phone calls. I greeted everyone, answered all the emails, and was just really listening for what is the biggest bottleneck that exists that we can start chipping away at. And it was very clear that was communication. And so we were actually a conversational AI startup right from the very beginning versus I think a lot of the companies that, you know, are adding on AI right now. It's been are pretty obvious if you've been doing it for a long time that there's a lot of value. And a couple years ago, how long did you last at that job, by the way, your research, your paid research opportunity?

It was like a good three months. It was quite fun. I enjoyed it a lot. That is a wild start. How important is it to the company to be seen as like an AI agent pure play? It feels like a lot of companies that are doing, that are really, really, really. successful or really adding a lot of value are actually not just picking the hottest tools off the shelf, but they also have a lot of traditional software and like SaaS. Some are bolting

on AI tooling, but others are kind of offering elements of both, whether it's traditional dashboarding or just traditional, you know, business logic and workflows. Like how has the business grown? What's the shape of it? What's demand like? Is it, is it, are customers receptive? to something that is purely non-deterministic? Yeah. I mean, a big part of what we work on is to make sure that it's providing enterprise-grade reliability to our customers in housing and health care

to highly regulated industries, to just really consequential decisions for, if we make mistakes, it's a big deal for our customers, right? And for their customers, their consumers. So we focus along on making sure it is, you know it is it is stable and it is reliable for for them yeah but yeah it's a mix of i mean you have to you know AI is a really powerful tool it's a new type of computer really and you can solve problems with that but also traditional software and other things that you you need are are also

important in solving a problem i think what's sort of different about what we builds we're not a we're a vertical AI company right we're not a horizontal AI horizontal being you know you know you can solve one sliver of a problem for a bunch of different industries. But our approach is we sort of go 10 layers deep into every problem. And that way we can actually solve that problem end to end. So it's very different. So let's say in housing, you are saying that you have a broken sync, right? It's very different when an AI might be able, you know, a large language model might be able

to say, hey, thanks for letting me know. I'll submit a ticket for you, and maybe it does that. For us, our AI is actually doing a bunch of things. It's understanding how that resolution should, how that issue should be resolved. It's coordinating all the workforce and all the resources, the systems, the compliance to get that ultimate issue resolved. Or there's things that we do that are not just pure

sort of conversational AI pieces, but we work in the physical world. So we have to actually unlock these things called doors and allow people to go and get into the building. So we have to do things like hardware integrations. And you can't avoid doing that if you actually want to solve the whole problem. Yeah. On the integration side, what's working on the marketing side is, are there channel partners or platforms that you can plug into to accelerate growth? Is it just a ton of SDRs?

Is there a viral component to this? Like, what's accelerating the growth other than just the product delivering value? Yeah. Yeah. We work in particularly non-technical industries, so it's not really, there's not a great market for people that are just naturally searching for the latest tech. There's not like an app store that you can go viral on and then all of a sudden you're the number one enterprise app in property management. Yes, I wish. It is blood, sweat and tears, we have outbound sales. Sure.

We do have a lot of partners. AI is actually a great vehicle for delivering a lot of the other products that exist in the industry. So historically, if you needed, if you, let's say you were a marketing software for housing providers or you were, or you have some other tech, you have insurance or something like that, you needed to train a human agent, a leasing agent or a property manager to make sure that got to. that marketing content got distributed and that's another manual step that people had to have and I think a lot of people in the industry have realized hey I can just partner with Elise AI and now my marketing terials or my insurance will be you know will be communicated to everybody else. That's Jordy?

Nothing for me. This is very exciting. Congratulations in the fundraise. Let us know when you add podcasting is vertical. We'll happily try it out. We're definitely in the market. We'll have a great rest of your day. Congratulations on the raise.

We'll talk to you soon. Thanks for joining. Bye. Bye. Bye. Thanks. I wanted to finish on this post from Lucas Buyer. Now at Meta-A-I, he says RF-R-O-FL, rolling on the floor laughing.

The solution it draws is amazing. This is from Tomer Olman. So the question for chat G-G-T-P-T-5 is, let's go back to this. And it's a picture of what, you can go to the next slide. Is this the head of a rabbit or a duck? And the answer that Chachapit gives is this image shows the duck rabbit illusion. It can be seen in two ways as the head of a duck

with the beak pointing to the left or the head of a rabbit, the ears pointing to the left. So the answer is it is both a duck or a rabbit. And then it says, would you like me to mark the outlines for each interpretation directly on the image to make the two views clearer and it does? Ah, that's so clear now. And it draws it on there, which is a fascinating ability

to even trace the outline. This was unthinkable in machine learning just a few years ago. What does it see that read out? Yes, maybe it's found a deeper truth. It's possible it's found a deeper truth. Or a visible rabbit. No, this is hilarious because clearly

it's been RLHF to know that people play pranks on LLMs all the time. They hit them with riddles. They hit them with unsolvable questions and trick questions. And that one of the things people demand of their AI chat bot is that they don't mess up when they're hit with a one of the classic examples is a boy is injured goes to the hospital the doctor says i can't i can't operate on this child and then the question is like

why and the answer should be because the doctor is the is the patient's father or something but you can throw all these subtle changes where it clearly indicates who is who and it'll still think that it's being hit with the test with the trick question well one more post from luke metro since we haven't covered him today yes there was a a young man very young man a teenager joined space x at 14 at 16 uh kairans he's joining citadel securities let's hear for luke says the hard tech is cool to actually money is cooler you've seen it before if he's really good he'll get poached by a lab within the next maybe maybe and then one final post from net cap girl can't pull jordie hayes out of the timeline uh sophie neckcap girl says august is the sunday of months so here's to hoping that it does feel like to have the sunday

scurries oh yeah september's going to come around and we'll be extremely back but thank you for thank you for watching hope you enjoyed the guests hope you enjoyed the show we will see you tomorrow leave us five stars on Apple Podcasts and Spotify. Thank you for listening. And subscribe to our substack. Yes.bpn.substack.com. Thank you. Have a good day. Goodbye.