TBPN Live - Ryan Petersen, James Cadwallader, Quaid Walker, Sarah Guo, Nicholas Harris, Raunaq Singh, Deel Spy Scheme, Tesla Deliveries Drop

Episode Date: April 2, 2025

TBPN.com is made possible by:Ramp - https://ramp.comEight Sleep - https://eightsleep.com/tbpnWander - https://wander.com/tbpnPublic - https://public.comAdQuick - https://adquick.comBezel - https://getbezel.com Numeral - https://www.numeralhq.comFollow TBPN: https://TBPN.comhttps://x.com/tbpnhttps://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231https://podcasts.apple.com/us/podcast/technology-brothers/id1772360235https://youtube.com/@technologybrotherspod?si=lpk53xTE9WBEcIjV(00:43) - Deel Spy Story (38:42) - Tesla Deliveries Drop/Elon Possible WH Departure (01:00:33) - Ryan Petersen/New Tarrifs on the Horizon (01:34:17) - James Cadwallader (01:48:31) - Quaid Walker (02:01:14) - Sarah Guo (02:34:06) - Nicholas Harris (02:46:23) - Raunaq Singh

You're watching TBPN. It's James Bond Day. It's Tuesday. It's Wednesday, April 2nd, 2025. We are live from the Temple of Technology, the fortress of finance, the capital of capital. We are enjoying these, uh, these pistols. Yeah. Apparently you don't get a gun if you're a spy for a B2B SaaS company, but you do get a gun if you're a podcaster. So that's fun. And you do get cool code words. Yeah. we're gonna be busting out lots of code words you're gonna wanna send to. Send that watch to London, John. Send that watch to London.

We love a good tech spying story. We've covered it before, the allegations that Deal implanted a spy or recruited a spy from Rippling, the rival B2B SaaS company that handles HRIS and payroll, amongst other things. We've covered it when the story broke a few weeks ago when I was in Washington, DC. Now we're back in the Temple of Technology and we're covering it again. And it's fascinating because the spy, so to give you just a little bit of background,

Guy works for Rippling, Deal is a rival. These two companies are very similar size and scale, but they've been bitter rivals for years, funded by different sets of venture capitalists. Guy from Rippling gets a, you know, starts applying for a job at Deal, maybe thinking about jumping ship or starting some consulting and doing some work with Deal,

the rival company winds up messaging with apparently the CEO of Deal and sending over secrets and potential clients and strategies that Rippling is using to win the HRIS market. And it's a fascinating story because you think about spying as being much higher stakes and maybe reserved for the Palantir's of the world or something that SpaceX would need to worry about or maybe Anderil needs to worry about it.

You don't think about it in the context of your payroll provider. The lesson is no one's safe. No one's safe. No one's safe. And so I think we will go through the affidavit, which we shared on X this morning. Parker Conrad, also the CEO of Rippling, also chimed in with his analysis. But I thought Everett Randall summed it up very nicely. You gotta hold it in camera.

We got these water pistols. T-MU Glocks. T-MU team who blocks but they look very I mean you split We spray paint this black and you know, that's gonna be an issue. That's gonna be an issue They're fun. They actually click when you anyway, so Everett quote ever it summed it up really well. We're good great me Parker's post can we pull up the average post ever Randall over clan of Perkins if you're not familiar He says no show there was a deal spy. Oh The deal founder told him it'd be like James Spy was directly on founders payroll through sloppy payment trail, which we'll get into

Founders dad also the CFO and chairman set up a code language to make it feel more like a spy movie I honestly am gonna be using these lines for a long time Rounder's dad, also the CFO and chairman, set up a code language to make it feel more like a spy movie. I honestly am gonna be using these lines for a long time. My favorite is send that watch to London. Send that watch to London is going to be in the canon of tech phrases forever. It's gonna be like sweet baby Rays, or the cat is in the bag,

the bag is in the river, that whole phrase. I'm trying to think of the other iconic, Senator, we sell ads, that. Yeah. I'm trying to think of the other iconic, Senator, we sell ads, that, I'm not doing it for the money, what was the Sam Altman quote, that just became a meme forever. There's going direct, founder mode, send that watch to London, you know it's gonna be iconic. That is going to be an iconic phrase.

But let's start with our post and then we'll do some reactions, and I'm sure there was some more reactions that are happening on the timeline right now. So I will run through a little bit of this. And going back, so we covered this story the morning that this was all breaking. The original Parker Conrad post. It was very explosive. At that time it was unclear, right?

The spy, we talked about this, is sort of caught in the middle in a weird way right nobody he's not not really on anyone's team at that point we had so many questions you know just in the past month he'd been paid by both rippling and deal yeah but now he's out in the wilderness by himself right and so there's this big question of which side is he going to take because that obviously gives a lot of leverage to the to the side that he sort of like says, this is my team, I'm riding with them. And so. And it even seemed like he was ready to,

remember he was like, I'm willing to take that risk. And it felt like he was like rider to ideal. And then all of a sudden he flips and goes and he starts cooperating with Rippling. And so why don't I do some reading which kind of trade off the post that we highlighted this morning. So the Athe David is basically step by step all the different sort of sections to the

story. Remarkably readable. 12 pages. And it's not total legalese. It's very much... It's in plain English. It's in plain English. You can just go read it. We posted it. We shared it. It's at the bottom of our main thread on the Deal Spy. And of course, one of the most fun exchanges here comes very immediately. And so the reason we are in James Bond mode today with our pistols, it's because,

so this all started in September of 2024. Alex, the CEO of Deal, who we'll need to remember his name's Alex, because we're just gonna be calling him Alex, we're gonna call Parker Parker, R him Alex. We're going to call Parker Parker. Rippling, there's a lot of people moving around. But Alex and the Spy, his name has leaked, but I think we're just going to keep calling him the Spy, because I don't know, why draw more attention

to this guy than he needs? Alex suggested that the Spy and him discuss career considerations, kind of a normal recruiting cycle. They talk on WhatsApp, they had a phone call and they had exchanged messages on LinkedIn and WhatsApp. Very normal. So the backstory here is the spy was working for Rippling,

applied to work at Deal and didn't receive an offer. Which is normal. And so he reached out to Alex to get feedback on the application process And Alex said you you kind of bombed your presentation Yep, but they built a relationship from that point on yeah, allegedly. Oh, yeah. Yeah, all of this is alleged This is a signed affidavit. So I think if he's lying in here He could be committing another he's lying in here, he could be committing another crime. He's committing another crime.

But let's just be honest, like, Deal has not responded. Maybe they have some amazing response and like, we'll hear them out if that comes out. It'd be super interesting. It'd be a crazy plot twist and we love plot twists. And so he takes a WhatsApp call with Alex from a meeting room in Ripley's Dublin office while he's at work and Alex told him, I have an idea. He suggested that he remain at Rippling and become a spy for deal, which is in quotes. So he must've said the word spy, not just like he could have been like, you know, dog whistling and said like, Hey, like, you know, we would, we would love for you to like give us

competitive intelligence, you know, no euphemisms, just straight up spy. And then, and then he says, he suggested that I remain at Rippling and become a spy for deal. And I recall him specifically mentioning James Bond, which is hilarious, hilarious to be like, you're, you're, this is the opportunity to be James Bond in B2B SaaS. Um, he said, I asked him what he meant. He said, a monetary reward if I agreed to spy on Rippling for Deal.

I told him, I'd have to think about it. And so communication immediately starts spinning up between the spy, Alex and Philippe, who's Alex's father and Deal's CFO. So it's a father-son combo kind of running the company. And they move from WhatsApp to Telegram, so of course they're unencrypted and probably disappearing messages,

and so a lot of those probably won't enter the record at any time. Later they talk about how a few videos and screen recordings. Well later the spy, to be clear, breaks his phone with an axe. Yes. Destroys his phone with an axe. Which as we know destroys all the information inside

for sure. Exactly. Maybe, who knows He also flushed it on the toilet. He really like went after it. It's it's it's just iconic This is like some one of the best tech stories in history so fun so they have a three-way call between Alex the dad and Whose deals CFO and the spy? Alex asked me if I was agreeing to his offer. Once I agreed, Alex said we should move the conversation

to Telegram, and so he sets up Telegram to engage in secret communications. Now this was something we were very interested in hearing, was how much was the spy paid? Because it feels like extremely risky to do this. It seems like it's extremely illegal, maybe criminal. It's like a lot of risk, and these are very high-flying companies.

The top people at these companies are making millions of dollars, right? They're getting huge comp packages, huge equity bonuses. You would think that to do something that's so risky, and also moves the needle for deal a lot. If they poach one or two of Rippling's clients from this, like that creates millions of dollars of value and he should be capturing 50% of that. Yeah, if we were his agent and this was all legal, let's say, we would never advise him on that.

We would have said, hey, you're going to put up some historic numbers for deal with what you're doing. You're creating some massive shareholder value for deal. You need 50% of that. So like it's got to be a hundred K that. So, it's gotta be 100K a month. But it wasn't 100K a month, it was 5,000 a month, which feels very low and it feels like 5,000 euros a month. The thing that makes this whole thing so serious is that some of these customers would have potentially not gone with Rippling or switched from Rippling to Deal,

and those contracts, even if you land a few big logos, could be worth tens of millions of dollars over the lifetime. And not to mention that, but there was also, you know, the spy was allegedly passing information on the superstar talent. Yeah, also poaching. And superstar talent, if you can get someone like that, what's a recruiter fee? 50K, 30K, something like that. And so he's gonna feed some superstar talent and get 5K.

So to put this into perspective, though, 60,000 euros. 6,000 euros, or it's 5,000 euros. Sorry, 5,000, so 60,000 a. It's 5,000 euros. Sorry, 5,000, so 60,000 a year. And you know, 5,000 annualized is what a general practitioner like a doctor makes in Ireland. Oh, interesting. And so it's actually like, you should put this into the equivalent of like,

he's basically, if he was in the US, he'd be getting paid like $300,000 a year. Okay, sure, sure, sure, sure. Sort of like the entry salary for a doctor. So it's not inconsequential. It's very possible that he was making more from this arrangement than his actual base salary. Because he wasn't super senior at Rippling.

He just had access to all the system because he was on the team. And man, they must be redoing their security like crazy at Rippling right now. Yeah. Bull market and IT jobs over there, I'm sure. Well, there's so much irony in this whole story, but the great irony is that Rippling was selling payroll

with IT and it seems like they were able to use their own product to catch the spy, which is a great, I'm sure they'll use that as a case study basically forever. Yeah. On why you should use Ripley. Yeah. And so initially he wants to be paid in fiat because he's worried about volatility in crypto

and so he asks that payments be made through Revolut, but over time he asks to move over to crypto, which deals CFO incorrectly believed would leave no trace. And in fact, it leaves the most trace. Permanent, public one. In fact, anyone can trace it. It's on the blockchain. Well, in this case, I think he was getting paid

to a centralized exchange. Yeah, so probably not, but like, you know, you can easily subpoena blockchain.com and ask what happened. But the big thing here is he's claiming that the payment came from the wife of the COO of Deal. And the reason that that becomes an issue is if it's true,

it just ends up incriminating basically the entire exec team, the CEO, the COO. It's like every single person was involved, yeah. And then the lawyer, the general counsel comes in later too. Deal's lawyer. And so there's like- That was unclear to me. I couldn't tell if it was external counsel

or somebody they brought in. But it seemed at least one lawyer from Deal was like actively working on trying to fix this issue that seemed to be internal. Yep, and so he would get the crypto, he'd get Ethereum in his blockchain.com cryptocurrency wallet and then he would liquidate the funds and transfer it. But again, it's so funny, we've talked about

a little bit of insider trading before. The most obvious thing is just like, oh, I don't want this payment to show up on my account because I'm working for a deal. I'll have to use someone who's arm's length for me. And it's like your wife who's like clearly tied to you. It's not like it's some, oh yeah, someone that you are not even connected with

on social media. No one could possibly know. You cross paths as children. You love each other, but you never talk. Is the issue is. It's so obvious. In this situation, if the spy had said, deal's my team, I'm riding it out with you guys,

all this stuff makes it so much harder to, for them, for deal to spin, right? Because you go onward where the spy's giving a record of the code words and phrases they use to coordinate payment, which Philippe, the CFO and chairman would say, would send a picture of a watch to the pain. Uh, the spy would send a picture of a watch to their payment chat and Philippe would say, send that watch to London. And then he would respond. The buyer is very happy.

Uh, and so they were sort of communicating and, you know, trying to imply that like there was, I guess some some type of watch transaction and that was the payment. That's how I read it. They wanted some plausible deniability that they were just trading watches with this guy. I think that's what they wanted to paper over a little bit. This corporate espionage is brought to you by Bezel.

Just kidding. As soon as I saw- No, no, we're not gonna monetize this. We're not gonna monetize this. This is sad. We're not gonna monetize this. But yeah, I mean, seriously, you should not be doing fake watch transactions. You should be buying real watches instead. Work hard, make legitimate money,

and then go and invest in real stuff. The crazy thing is that Deals CEO would allegedly would message this by multiple times a day. And if the spy didn't respond quickly would follow up and sort of double and triple text. His texting style is wild. He's yeah, honestly sounds seems like pretty cool. Throwing the word boss around.

Yeah, yeah, it's funny because like he's the CEO of a multi billion dollar company, very successful and And and he has this spy who's like clearly on like many levels below him only making 60k Is there a reason you're pointing gun at me? No, no, it's very threatening to just interview Jordy's like this at me like just under the table table. Sorry Don't say don't cut me off. don't say never don't say what you're about to say never cut me off while I'm talking erwan erwan coffee in one hand but but he texts in all lowercase which has been

a contentious issue on the timeline for a while, but he always addresses. He always addresses the spy as boss. So he'll say, hi boss, or hey boss, can you search for this? And Alex would frequently message me on Mondays with hey boss, good weekend, with two question marks, which is something I don't normally do. Casual and fun, and hey, let's give him some credit. He wasn't calling him, but yeah A lot worse I like boss. I think I think it's a good way to address

Yeah, chief is respectful Can't stop pointing the gun at me water gun at John I can't stop pointing the T-MU water gun at John. Anyway, so what did Deal actually want the spy to search for in Rippling Systems, what we heard about Tiny Bird before, but we also know that they were searching for Tom Brady. We don't know why, but I think maybe Tom Brady is building a startup and needs HRIS, maybe?

You think that's what it is? I was trying to. Or maybe they were gonna do a sponsorship. Anything we'd say here, I think would just be pure speculation. Iran seems pretty obvious. Yep, because there were allegations that deal was being used in sanctioned countries, I believe.

There was a rumor going around, and there was some reporting by the information that maybe some clients, and this is the nature, I mean, I don't wanna be too harsh, like this is the nature of like online platforms. People try and abuse them all the time. Sometimes it's, you're doing everything you can to stop abuse and you still get a little bit,

but the allegations were that they weren't really doing that much. Yeah, and who knows, but clearly he wanted to know if people at Rippling were talking about Iran and probably in the context of deal. Yeah, interesting. But who knows? And then, yeah, they was also asking for superstars.

What was up with Tiny Bird? I don't know. I don't know what Tiny Bird is. It was mentioned in the previous thing. I think it was like, wasn't it the leak of the, it was something that was, wasn't it like the honeypot? It was like, there was an article that was gonna go out

that was gonna mention Tiny Bird. And so, and so, Rippling sent an email to the executives at Deal and said, like, hey, there's this hit piece coming out that's implicating you, and it's about this thing called Tiny Bird, and then they knew that they searched for it, and they would have no way

to know that that was the keyword that was gonna be in that article unless they had read that and then passed it to the spy, which is exactly what they did. Tom Brady though, could, there's potentially a Tom Brady of B2B sales. Oh yeah, maybe that's it. You're looking for a superstar.

You wanna know who the goat is. Who's gonna recruit them. Looking around. The next Sam Blonde. The next Sam Buck. Everyone who's good in B2B sales, Sam B, always. Yep. Sam Blonde, the next Sam Buck. Everyone who's good in V2V SaaS sales, Sam B, always. Yep. Sam Blonde, Sam B.

The CEO and spy were friendly and enjoyed talking about sports. Alex, the CEO of Deal, was also just chatting it up about Paris Saint Germain Football Club, the soccer team of Paris. He reached out to me multiple times today to request information about rippling. It seemed constant.

It had been a few hours since he had heard from me. He would reach out. And then the level of detail here, like the management, I mean, you join an organization, it's usually pretty hard to get face time with the CEO, but you come in as a spy, you're gonna get direct access. You can chat them up. You can get all the mentorship you want.

Maybe this is the path to career acceleration. If only it was legal. Yeah, so here's where it gets particularly spicy. So at the end of February 2025, Alex told the spy to search Rippling Slack system for the channel hashtag D defectors. And remember, this was part of the honeypot operation that Rippling was running to try to prove that

Deal senior management was coordinating with the spy The spy ran the search immediately and began to look at the results within minutes Alex had messaged him and told him not to run the search because he believed it was a trap The spy told Alex that by the time he got his message he'd already done the search and alex said oh shit Wow And uh the spy said I told him that deed effectors had matt plank rippling's chief revenue officer in the channel Not who you want to find in the virtual world of like of like walking into a room and like the big guy Is just there and be like how about you have a seat?

Like we the jig is up The jig is I wasn't't expecting HR to be here. Yeah. I told him I was framed, but he said, don't worry. Thereafter, he continued to press me to pass him information from Rippling, which is extremely bold. Like you think it's a trap, it looks like a trap.

It went in, you went in and looked around and it was like, only this chief revenue officer is there. No, the thing that you expected was not there. It feels like a trap, you suspected it. And then he's like, don't worry, let's just keep spying. You're good. Like they should have cut it down then in February. Yeah, who knows, but it was probably already too late.

So maybe he ran the calculus of, you know, let's just. Should we talk about the escape attempt? I don't even think he attempted. I mean, obviously when he was confronted in his office, this was the spy, the spy made a bunch of excuses and said, oh, my phone and my laptop are down here. He had them. He said he went into the bathroom

and he flushed the toilet a few times, but I don't think he flushed anything or that's what he implies. And where it gets particularly interesting is that the apparently a Cief deals in-house lawyer was at this point starting to talk to him and said that he was speaking in a personal capacity, Rippling has nothing, and Asif suggested

that the spy and his family fly to Dubai that night, saying, we all need a holiday. And, yeah, Dubai has, I don't believe, has extradition agreements with anyone, do they? I don't think that's true. I think they do. I don't think that's true. I think they do. I don't think it's non-extradition. I think it's just hard to find someone

if they're there, laying low. I think you have to go way, way more obscure, but I don't know, you can look it up. The spy proceeded to smash his phone with an axe. He also deleted his LinkedIn account. That would do anything, but it's very odd. Yeah, they do. They signed an extradition treaty in actually late 2024.

Ireland in control. And the UAE. Yeah, they were ahead. It makes sense. I mean, there's a lot of people that go there. It'd be weird for it just to be like a free for all of criminals, right? And so he smashed his phone with an axe

and put it down the drain at my mother-in-law's house as Deals lawyer As the Deals lawyer had advised That that evening Deals lawyer Spoke to his wife for 45 minutes on to an hour on a telegram call Reassuring her and corroborating what I had told her that Ripley was lying and making all of this up My wife later expressed concerns to me about the call with Deal's lawyer. She said that what he was saying did not add up and she felt he was being pushy.

And so the spy finally decided to cooperate with Rippling after getting a text message from a friend that said the truth will set you free. And so the family members were advising him to just tell the truth and that it was the fastest way to move past all of this. And so he realized that he was harming himself and his family to protect Deel. He was concerned and am still concerned about how wealthy and powerful Alex and Philippe are, but I know what I was doing was wrong. After I spoke to my solicitors, I started to feel a sense of relief. I want to do what I can to start making amends

and righting these wrongs. Yeah, and I'm not surprised now getting his side of the story that he very quickly flipped to Team Rippling. Yeah. It just doesn't, it's hard to imagine like seemingly if you went with deal and this was the situation that it was gonna be hard for him not to go down with the dealship. Now there's a lot of different stakeholders and

players involved here. There's deal and its management team, there's deals shareholders right and then on the other side you have rippling and rippling shareholders. And it's going to continue to be extremely messy. But and to be clear here, like the spy, nothing about this makes the spy look any better. In fact, it's like he knew what he was doing the entire way and repeatedly made the choice to Commit crimes

Yeah, steal like there are gray areas for some There's not a lot of gray There are gray areas generally and not in like corporate secrets But in like strategies like if you go if you if you go and work it at you know Some high-growth company and then you're recruited somewhere else and you leave like yes Like if you go and work at some high growth company and then you're recruited somewhere else and you leave, like yes, you can't export GitHub code, everyone knows that,

but can you call up someone that you got drinks with and maybe you met them in a corporate context, but then you became friends and then you get them as a client? Like probably. Or can you just say, hey, at my last company, we worked really hard and we had this fast-paced thing and this was our strategy, so why don't we implement

that strategy here? That stuff happens all the time. That's the reason why VCs love to back former Stripe operator now doing a startup. It's because it's like, well, we hope that you're going to kind of steal the Stripe culture or copy it in some ways and bring that to bear in your new organization. Now, the line is drawn at like stealing secrets, IP, contacts, connections,

and then obviously way, way further. But the whole thing is that to your point, this wasn't even framed as anything like that. It could have been framed as like, hey, like you have this depth of experience at a rival company. We would love to get you out of there and then put you to work in a much higher growth scenario very quickly. Take advantage of this, all the expertise that you learned over there. Obviously don't steal anything, but you're going to hit the ground running very quickly here as opposed to if you came from a company that has nothing to do with this industry

That happens all the time, right? Yeah, so but it doesn't look like that at all and the fact that they like it literally kicked off with like hey Do you want to spy and be James Bond? Yeah, not good to be clear. We don't have any insight into Rippling's employment agreements but there's things like IP assignments and things like that and and There's no spying clauses. Yeah, there's gonna be plenty of documentation around that that would make it very obvious that that by giving company secrets and IP to to a and getting paid by a direct competitor is just gonna be

Yeah. Yeah, that's that's the thing that's sort of unclear with the case so far and how this is gonna shake out is like there's the civil case. There's potentially criminal cases. The way this is shaking out now, I mean, we saw like, I think it was JD Ross said, never seen anything like this in tech. These guys are all going to jail

and Deal will likely die as a business. I don't know. That's aggressive. Very aggressive. I don't know if either of those are true. There are so many layers of irony in the story. It's hard to even know where to start, which I do agree with. But the first part is it's hard for me to imagine how Philippe and Alex stay in management roles or the COO, right?

Like seemingly like they all probably have to go for the company to move forward. Will they go to jail? It's unclear. I think that again, it will kind of be on rippling and rippling shareholders whether rippling wants to. Right now, I believe it's a civil case, right? And so that doesn't mean that, and there will be,

if that were to proceed, there would be sort of penalties and a number of consequences for that, but it could switch to being a criminal case. And at that point, who knows? There could be jail time. But before you get to that, you'd have deal. And deals board and shareholders broadly that could go to Rippling and say, this was clearly a big mistake.

Here's what we're going to do to correct it. There's probably a massive settlement associated with that. It's very possible that Rippling could basically get like a series E done here to move forward. Yeah, yeah, yeah. A non-dilutive series E type of thing. Yeah, yeah, yeah. Just like, hey, if you want this to go away,

you're gonna have to pay us $100 million or something like that. That would be crazy, it's possible. The thing that I was talking about with you earlier was, okay, so if Deal winds up paying Rippling a huge settlement to make this go away, well, now they have a new problem on their hands because their investors should be upset about that

because that was a massive liability that was not disclosed to the investors. That could be considered securities fraud and they might have a case there. And so you're kind of fighting a war on two fronts. You want to keep rippling happy, but then you also want to keep your shareholders happy. And if you can't do both, you're going to face pressure

legally and how that will manifest. I don't know if it's criminal, I don't know if it's civil, but like you're going to face pressure and there's going to be unhappy people on one side or the other. And that's a really, really tight spot to be in. It seems like no matter how much control Alex and Philippe and the COO have over the business today, just purely from a corporate standpoint,

I don't see how they make it out of this. Yep, I agree with you. Still running the company. Yes, I completely agree with that. There is the bigger question of like, this could be a where there's smoke, there's fire situation where there's other problems with the business. And there's been like rumblings about that and reporting,

but let's assume that Deal has, you know, huge book of business and a lot of companies that are, you know, relatively happy with the product and they run their payrolls on time and do HRS stuff. And they're just like happy with it as a SaaS product. And they couldn't even tell you the name of the CEO if they tried you know like we use you know sure microphones here I can't tell you the CEO of sure if sure was embroiled in a conflict or some controversy like I wouldn't be aware of

that and so it's totally possible that a lot of deal clients just don't know that this is going on and And they don't care. And they're like, well, did my employees get paid? You gave the example earlier off air, like tires. Like if you went to the, like for people in tech, this is the biggest story. It is the biggest story. It's so dramatic. The year so far, even though, you know, Monday night you get this like $40 billion biggest

venture round. Yeah, yeah, yeah. Who knows if that's, you you know completely real or not but uh still like this is the craziest story ever is YC on YC violence right it's crazy like talk about talk about being a rough spot if you're Y Combinator right now you're looking at two of your darlings uh just sort of duking it out in a very sad way at two of your darlings just sort of duking it out in a very sad way. But the example you gave was tires. I kind of disagree with that actually.

Because oftentimes competition is for losers. You want one power law winner. So the value of a single really concentrated winner might be higher and higher margin. Anyway, sorry. Yeah, yeah, yeah. But again, I don't believe that a deal with hundreds of millions of dollars of revenue

is going anywhere. Yeah. They have tons of massive multinational companies working with them. And it's going to be a big business, I think, for a long time. But the- My example of the tires.

Yeah, so the tire example, I thought it was good. If you work in the tire industry, and Michelin and Bridgestone are doing corporate espionage on each other, you're like, this is crazy. We've never seen anything like this. Like, it's like, you're fixated on it with your friends. But then if you go to like, if I went to my mom and I said, hey mom, like I saw you have Michelin tires.

Did you know that Michelin was stealing from Bridgestone like their rubber, you their rubber supply chain secrets, and she would be like, okay, sweetie, like that's, you know, I'll keep that in mind. And then she's replacing her tires in a year, and she's like, doesn't even remember. Yeah, unless it actually affects the client, like the way FTX locked your funds,

or Theranos was giving you the wrong information but if there's just if there's just chaos at the top and You never even knew who the CEO was you might just be like hey, I'm not gonna rip out my HRS system I'm just gonna stick with what's working at the same time It's got to be the best time in history to be a rippling sales rep. Can you imagine sending those emails? Hey, I saw that you're a deal client. Did you see the latest affidavit about the spying thing? I'd love to hop on the phone

and tell you about rippling service. They must be having a blast selling this product. The sad thing here, and I'm sure the frustration for the deal team and the shareholders is that deal, despite the spying, ignore the spying has executed phenomenally has built a one of It's one of the most impressive revenue ramps. Yeah that we've seen in the last ten years and They had a big lead over rippling. Sure. I don't know what their growth rates look like exactly

But the spying thing reeks of desperation And it didn't feel like they were quite in a desperate situation yet, right? No These markets are huge even if rippling and Deal just feasted on ADP. Yeah and pay comm and all these big providers They could have each eaten another 500 million of ARR a year for a very long time. And they've both been fine.

And now it seems very unlikely that this company is gonna be founder led by the end of this month, I imagine. I just don't know how you let this go. I wonder if there were any, any, seriously, I wonder what there were any serious, I wonder what deal was doing against ADP, what was their strategy to beat Paycom, Paylocity, any of those larger public payroll companies,

because to your point, I think that really is somewhere where you could just feast on the market cap for a very long time. And probably not as aggressive of a counter espionage effort as Parker Conrad, who clearly has taken deal seriously as a competitor for a very long time. He's like the, yeah, he's the hornet's nest. You probably want to kick. Yeah, when you look at their product strategies, right,

Rippling is the original compound startup. They did R&D for years, I think, before they actually went to market with their product. And RIP deal started with a simple idea, enable global payroll, complicated, actually underlying product and infrastructure to do that. But then they both were just converging back, they sort of started in their own lanes,

got up to hundreds of millions of revenue and then started aggressively converging onto the same core opportunity, right? Yep. And yeah, so these companies were just always destined to Collide. Collide. Collide they did. I liked Will Manaitis' take here.

He says, talking about deals, CFO, using code words and phrases to coordinate payments with the spy, send that watch to London, the buyer is happy, et cetera. Will says, it is a useful law of human behavior that whenever you're engaging in something your heart knows is wrong, your brain tries to rationalize it in narrative terms. The second you find yourself using code words, you're doing is wrong, your brain tries to rationalize it in narrative terms.

The second you find yourself using code words, you're doing something wrong. Speak simply and speak truthfully. I thought that was a good take. Good take, Will. But code words can be fun. Especially when you repurpose other people's code words for your own.

Well, those are just memes then. I liked Andrew Reed's post. He said, paid mans in ETH on blockchain.com sounds like straight out of a UK rap song. I can always count on UK rap to tell me how many people were in the car. That's funny. You like UK rap. Yeah, Stormzy, we were listening to the Stormzy in the studio.

Paid Mons in ETH on blockchain.com. Blockchain.com. So silly. Yeah, Josh Pacini says. This one went super viral, by the way. You're like James Bond, but you only make 60k. You don't get a gun, and you steal B2B SaaS secrets. Not the best trade.

But yeah, Europe honestly took some brand damage here. Yeah, if you're willing to spy for 5K euros a month, gotta get the economy going guys. Risking it all. Yeah, I'm sure DealSpy massively regrets his actions Yeah, I'm sure Deal Spy massively regrets his actions. And I'm sure everybody involved does, except Parker. It's always, yeah, whenever there's a crime- War time Parker.

War time CEO for sure. Yeah, whenever there's a crime, there's always, there needs to be accountability, but at the same time, I think there needs to be some empathy. Like this is a frustrating and difficult situation for all involved. And I think, you know, I just hope that there can be

a resolution that where like there's some sort of resolution and we're closing the book on this chapter of tech industry in a meaningful way across the board. But I'm sure there'll be a lot more news related to this over the next few weeks, the next few months. The story's moving incredibly fast. This whole thing started just five months ago, and then it broke just, I mean,

the honeypot happened in February, and then in March, boom, the story dropped. And so everyone's been moving very quickly here. And it's been fascinating to follow. Moving quick. All right Well, we should move in to the next story. Yes Tesla's global vehicle delivery sank 13% in the first quarter Recent surveys have shown an erosion in the brand's appeal, especially among Democrats in the United States

And so Tesla was putting up massive numbers for the last two years somewhere between 400,000 and 500,000 vehicles every quarter. In Q1 of 2025, Tesla delivered 336,000 vehicles. Still a lot of cars, but a 13% fall is nothing to ignore. And so you got to dig into it. And I was always wondering if there was going to be, obviously there's a decline in interest from Democrats.

Would that be offset by Republicans who now like the brand? Well, we kind of have the answer, at least right now, that demand has not. The issue is the average Republican that has switched and said I'm a turn to an Elon fanboy, loves Ford Raptors. And that's the big challenge. It's like, no matter, even if they think they're on T and Elon now, the Ford Raptors still probably

the greatest truck. I still think that's an opportunity though, because there's no reason why Elon and Tesla couldn't build something like a Ford Raptor or a Ford Raptor R, like a lifted truck. Well, it's not the cyber truck. No, not the cyber truck because it needs to have an internal combustion engine for sure. And it needs to have, you know, you need to have an option on the Tesla configurator to

say like, I want to check the I'm rolling coal button. And then it just has the massive smokestacks out the back. It needs to have a really aggressive engine note. These things are important to the new customers of Tesla and I think Tesla needs to adapt. But let's dig into it at the Wall Street Journal. There's further evidence that a growing consumer backlash against the brand is hurting Tesla's business.

The analysts were expecting 396,000 shipments. It came in at 336,000, much lower. Tesla shares were up 4% in midday trading Wednesday following the release of its latest delivery figures. Fascinating that it went up, but I guess the market was expecting even more of a sell-off. Musk's active role in the Trump administration and vocal support of four far-right parties in Europe has made Tesla a target of political protests and boycotts in recent months, including in some cases by once loyal Tesla owners.

Yeah, it's, Yvonne's probably looking around like now, watching the stock pop 5% being like, hmm, hmm. Interesting. But it's possible this is more of a reaction to- China. No. Oh. The news that he may be leaving the White House.

Oh, sure. So if he goes deeper into just like, I'm back in just the tech world, that would certainly offset things, yeah. It seems clear that there's a limit to his, there's some sort of limit to how much he can multitask. And I would imagine that Tesla shareholders will benefit from him shifting focus out of the government

and back on to sort of. So we saw this from Joe Weisenthal. He took a picture of a computer showing Bloomberg and there's an article in Politico that says, Trump tells Inner Circle that Musk will leave soon.'" Obviously just kind of rumor mill at this point, but interesting if true and unclear what that would mean for Tesla.

Could the Democrats who have been buying Tesla's kind of forgive and forget and move on and come back to the brand. I certainly think it's possible if Elon wanted that, he could go on, he's a very good communicator, he could go on a press tour and say, hey, yeah, I'm actually just really focused on cars right now. And I was thinking about this, Tesla should be the most nonpartisan vehicle in the world because it's electric, so it appeals to Democrats, and it's built in America, and so it appeals to Republicans.

And he could, if he was purely focused on that and didn't care about the politics stuff, he probably could have gotten the Tesla brand to a position where it was loved by everyone in the same way that Nike is loved by both Apple. These are very bipartisan brands, nonpartisan brands. But I think he really did think that this, he was a true believer in this idea

that the 2024 election was deeply important and it was worth him coming off the sidelines, risking everything to move Washington in a different direction. And he did that and now he kind of, you know, there's going to be some, like we were talking to, I think we were talking to Senator about this, like, like what is the net effect of Elon's going political? Like, will it be good or bad for him? Like, and it's like, okay,

what are we talking about here? Like aggregate net worth, like some of his companies might do better. Some of his companies might do worse. We have to like add all those up. I think if he was running the calculus would be like, this is probably short term bad. But if I can be effective and sort of change the course of history with the country, then it will be net good in the long run.

But certainly it would have been hard to argue that going in short term was just going to be default good for everything. Yeah. I mean, you could even imagine it's like, okay, so what if the work that he does winds up streamlining the FDA, speeding up Neuralink development and Neuralink, every single person winds up getting one and they cost $50,000 and all of a sudden that's a bigger... Oh, really? Opening up a patient registry.

Fantastic. But there was two poly markets I want to look at. Yeah, please. So right now, Elon out of Trump administration before July is sitting at 50%. 50%. And then out of the admin in 2025, sort of basically by the end of the year,

is at a 76% chance. Wow. I also wonder what that will mean because it's totally possible that, so people have been predicting like the Trump and Elon relationship is going to dissolve and blow up. It's gonna blow up. Like they're two, they're both two hard charging,

aggressive figures. It doesn't make sense. They just can't last. That's been the narrative, right? Yeah. But it's possible that they, that Elon is no longer a member of the staff of the White House, like he doesn't have a.gov email,

but they're still friends. That is a possibility. I don't know if that's where it's going. I really can't predict any of this. I'm not really tapped in in D.C. So. It would be very short-sighted for both of them to blow up the relationship.

Yeah, I think so. It seems like it's been pretty mutually beneficial. I don't know. I mean, no one expected them to win and then they did. So, you know, it seems like it's good. Sales from China, which exports to foreign markets, fell 49% in February but fared better in March after it started delivering the refreshed Model Y.

I saw the first refreshed Model Y on the street the other day. It looks great in China. According to China Passenger Car Association, the company sold 78,000 China-made vehicles in the month, down 11% in the same period last year. Despite the decline, Tesla climbed back to third place in sales in the Chinese car market after dropping out of the top five in February. And they have some stiff competition that I'm actually very excited about. I think just from a consumer perspective, seeing some of the demos of the cars and the way the Chinese car companies are pushing things forward is awesome.

Have you seen that demo of the adaptive suspension? So you're going around a corner super hard and it's tilting the car so it's perfectly flat, and they have a wine glass on the center console, and it's not spilling. Amazing. Or going over bumps, and the car is adapting to the bumps, so it's just perfectly smooth. There's all these, they do all these weird features.

There's a car that floats. We talked about that. There's a bunch of simple features that just make sense. They have hand tracking, so you can be like this, and then it'll pull down. There's even like this LED bar on the back of some of these cars, so you can send a message to someone in front of you

or behind you being like, sorry, I was on my phone. That's why I didn't go when it was green. You could send that. It's all these funny, weird things. There's this explosion of innovation and testing weird things, and I like that. Tesla cataly send that. It's all these funny, weird things. There's this explosion of innovation and testing weird things. And I like that. It puts pressure on our companies.

Totally. Yeah, Tesla did the same thing. With the noise. The simple stuff. Yeah, the fart feature. Yeah, or playing video games or playing all these different things. Tesla very much did that.

And while I absolutely want American companies to win, I do like the idea that there's now pressure to say, okay, we really need to step it up. Innovation is good. I want to see Mercedes execs look at these videos of these Chinese manufacturers and be like, okay, they're like way ahead of us on so many dimensions. Yeah.

I mean, I'm pretty sure that, I don't know if it's a Yong Wang U8, but the CEO of Ford was driving a Chinese car, like daily for like weeks because he was like, I need to understand what's going on over here. And like, we need to figure this out at this company. Yeah, yeah, a little bit of that. So in Germany, home to Tesla's European factory,

new vehicle registrations fell 76% in February compared with the same period last year, according to the country's motor transport authority. In the US sales fell 2% in the first months of the year according to research from firm Ward's Intelligence. And so that's not that much of a drop considering that I think of Elon as being more politically controversial in America

than I mean maybe in China, maybe in Germany, but it seems like it's a little bit more distant there, but I don't know. I think people make car, I think these purchases are super considered outside of somebody's home. It's one of the most expensive decisions that they make, and, you know, are costly sort of products that they buy.

And if you're looking at buying a car, you're looking at the cost, if it's an EV, you're looking at the range, you're looking at buying a car, you're looking at the cost, if it's an EV, you're looking at the range, you're looking at the features, yeah, maybe you care a bit about the founder, but that's only one factor, right? And so right now, Tesla's basically giving away these cars. You can get a Tesla Model Y for 300 bucks a month. Your phone bill.

Yeah, it's not far off from your phone bill, so it's an extreme, and who knows if that's at all profitable, but it's an extremely solid offer in the market, and the reason for the sales decline is despite these sort of massive incentives, every other manufacturer has overproduced EVs, so they're also giving these things away. You could get a Rivian pickup truck last year

for like 500 bucks. It's like, it's like, it's great. They're giving these things away. And so yeah, it's a amazing time to be a buyer in the car market. You have a lot of options and the sales decline, like I'm sure was anticipated by analysts, right? Tesla basically had a monopoly on quality, cheap EVs for a period of time.

It also felt like they were reaching saturation. Every car on the road in LA is a Tesla. At a certain point, I understand the monopoly power that accrues to the iPhone and the integration there. And everyone wants the blue bubbles and everyone, it's nice if I have an iPhone, you have an iPhone, we can do AirDrop. and everyone it's nice if I have an iPhone you have an iPhone we can do

Yeah, airdrop cars It's a little bit less so and I feel like cars are still a little bit more of like the status symbol what it says about you the difference of the the Ford Raptor driver versus the Audi r8 versus the Lamborghini like they all say slightly different things and at a certain point if every single person is driving a Tesla Which is like this appliance car, there's just going to be some people in the world that say, you know what, I will accept a lower quality of car,

even on a price per power or horsepower, any ratio that you want to measure, like quantitatively a worse car, just to express myself and actually say something about myself and say, hey, I have a convertible, like, and that says something about me, or I have a truck, and even if I don't need that space, I have it because like, it makes me feel like a cowboy,

and I like that, and like, if Tesla's not offering that brand feel, that will drive other adoptions. Cars are brand feel, that will drive for the retarded. Cars are so emotional. Totally. That people use them. It's like a handbag for women or a watch for guys as a way to express yourself.

Some people still just say, I'm gonna be practical. I'm gonna buy the cheapest, best option. Other people do what I did at one point and bought a lifted Ford Raptor because I just wanted to live out my childhood dreams. Exactly, exactly. I had a great time with it. And then it was so funny driving Ford Raptor. Yes, I just like wanted to live out my childhood I had a great time with it and then I it was so funny driving a Raptor because I felt like I'd go to a meeting and If if the person I was meeting with saw me pull up in the Raptor

I had to like explain like well, I'm actually like driving it like kind of ironically I'm kind of driving this more for like my like 10 year old self more than my current self I just want you to know that I I'm not really a Raptor guy, but I kind of respect it. Completely murdered out and it's tinted. Anyways. Yeah, that's great. So in California, where Teslas are among the best-selling vehicles, the new vehicle registration

of Teslas fell 11.6% in the state. Obviously, California is like a D plus 30 state, and so very democratic, maybe more affected there. But also there's such a saturation happening. The market cap of Tesla reached a high of 1.5 trillion in mid December in the weeks after the inauguration, the shares, the price per share returned to pre-election levels.

Was that? And so there's also been vandalization. That was their all time high? Yeah. And so now Musk is trying to refocus investor attention away from car sales and onto its driver assistance software, which it calls Full Self Driving Supervised, and its Optimus Humanoid Robot technologies

he has claimed could one day boost the automakers market value to as high as $30 trillion. You'll love to see it. The humanoid robot market, it's also fascinating because everyone is so skeptical about it. Like the anti-Elon people are like, it's tele-operated, it's a guy in a suit,

like it's nowhere near any commercial scale. And like, that's probably true. Like the optimist does not seem to be something that's gonna be shipping anytime soon. But at the same time, like we've seen the Chinese humanoid robots, like they work, you can just buy one. Like it can't do everything, but like it's out there.

It exists, it's not some sci-fi, we have no idea how to do time travel. And it's like, people are writing academic papers about how one day you might be able to make a humanoid robot It's like Boston Dynamics exists. You can see the Atlas robot running around you can see the The and you can actually get a unit robot. Yeah, you dog for under three grand on Amazon Yeah, and so and so like unitree is shipping these things. They're not great But it's like can can Tesla copy that and just copy paste that Absolutely can even figure red adcock like like can they just set up a plant that copies unitree like

Doesn't seem that crazy even the legacy car makers were eventually able to make electric cars that were in the same ballpark as Teslas. Like the Ford Mach-E is, it has similar range, similar performance. Like a Tesla fan would say like, oh, it's like too expensive for the power and you don't get the self-driving stuff.

And it's like, yeah, that's all true. But it's 80% of the way there, 90% of the way there. And there are some electric cars that give you a better Experience than Tesla in certain in certain categories like the Rivian the Rivian has a full-size SUV Tesla does not like they they have the crossover and so and and even like The the taikon the taikon comes in a in a wagon configuration Like Tesla just doesn't have a wagon. Which I think looks fantastic.

I like it a lot. And also like Tesla doesn't sell a convertible. Like if you want a convertible electric car, like you're out of luck with Tesla. And so there's all these ways where you could kind of like slice up the market, figure something out, but like these humanoid robots, they do exist. And so even though it feels silly to think about Tesla

as like, oh yeah, they're gonna win in humanoid robots, it's like, well, they're probably gonna do something there. And they're probably gonna make it, they're probably gonna make something work. And so I'm very interested to follow it. It's fascinating to see how this pencils out. And it'll be interesting to see how Elon kind of reintroduces the company or if he does, he had Trump pushing like, hey, go buy a Tesla. There was those note cards. You saw that?

The Tesla cost $60,000, this and that. Is there a way that he can beat the Ford Raptor at its own game without putting an ice engine which I think might you might need to do that would that would go crazy Cybertruck yeah internal combustion engine he needs a Hellcat competitor he needs a Dodge Charger competitor something that trades I mean one of the problems with Tesla, I'm sure one of the problems with Tesla is like there's too much technology in that so you can't really like trade it on Facebook Marketplace just like here are the keys like I don't have a title because like whoever actually owns it will be able to just like it has low jack basically because it's so connected

and they can just disable the car. But if they take some of that stuff out, they put in a V8 and maybe throw some superchargers in there. Yeah, really get the secondary market pumping. Get the secondary market pumping. Get the thieves involved. Anyway, we're having some fun.

That was always a good bit of ours. Yeah, yeah, you gotta get out of the cut. Well, Tesla sells products online. They sell cars, but they also sell stuff like merch. They'll sell tequila from time to time, but a bunch of hats, things like that. And what should they use for sales tax compliance and automation?

Numeral, baby, they should go to numeralhq.com. Benchmark series A. Sales tax on autopilot. Spend less than five minutes per month on sales tax compliance. They work with thousands of high growth companies. And if you are selling products online or you're a SaaS business, go sign up for Numeral.

And just for old time's sake, tell them the technology brothers sent you. They'll know what you mean. And there's 25 states that are taxing software sales. And if you have any type of scale with your SaaS business, I'm sure you're dealing with this already. So go check out Numeral. And this monitoring feature is actually

genuinely very interesting if you're a startup and you're growing because Oftentimes you don't have to pay sales tax until you hit some sort of threshold And so their example here is like they're monitoring your sales in New Mexico when you hit a hundred thousand dollars You're gonna need to register and start paying but as long as you're under that the the state doesn't care Which is great because the state it's cumbersome to file these new tax, these new sales tax reports. So they're gonna track that and then help you file that as soon as you need to.

So I mean, I've been caught so many times like I can't even count where it's like, oh, we hit the threshold, then we had to go pay a lawyer to figure it out and like do all those things. This is a really great product. So go check it out, Numeral HQ. Anyway, let's move on to some watch news.

Some big watch news. So we got Quaid. We got Quaid coming on. Co-founder of Bezel, he's calling in today. We're gonna be breaking down what's happening at Watches and Wonders. Basically every watch company launched new watches. The one that I want to highlight here is Vacheron Constantin has released the most complicated wrist

watch ever created. The Solaria Ultra Grand Complication featuring 41 complications and 1,521 components. Eight years of research and development, 13 patent applications, and it tells you everything, like, you know, sunrise, sunset, moon phase, day, month, year, time, set alarms, like all these different things on it. And the funniest thing is I'm sure this thing costs like a million dollars, but I was looking at this and I was like, yeah, like that's actually

like really useful stuff, like I need this. That was my reaction, was like, yeah, that's actually really useful stuff. I need this. That was my reaction. It was like, yeah, this is totally justifiable. This is just like, just practically. Just practically. High output podcasting, live streaming, you just kind of need this level of performance. Yeah, I was like, I'm sure they charge a lot,

but look at all the complications. You kind of need this. I need to know where the tides are on my wrist and even with a mechanical device I can't use my phone for that but I mean this is a fantastic watch and it looks very cool and it's also pretty huge and on the back they have constellation charts if you see this insane you can see where where that what the night sky we've been saying this but Vacheron is we believe, Yes.

going to go on a generational run. We think so. It's already on the run. It is. It's fantastic. Well, I'm excited to have Ryan on. He is going on with Kramer later today. And so I think we should help him workshop

some just crazy takes. Crazy bangers, crazy bits. Yeah, you just want to go big. You want to go extreme when you're on there. Yeah. I mean, we should set the table a little bit. Basically, Trump is giving a press conference today at 4 p.m. Eastern.

So in exactly one hour, this should start. Tariffs are looming but Trump has called it liberation day, but the the stock market is up maybe Calming fears that there will be really really aggressive tariffs the yield on the 10-year Treasury note ticked up as well on pace to snap a Three-day streak of declines gold prices rallied sending the precious metals towards another all-time high Trump has declared April April 2 Liberation Day for US trade policy. He is due to announce the contours of a sweeping tariff plan at 4 p.m. Eastern in a Rose Garden address. The Wall Street Journal will stream the president's tariff

comments live. The tariff fight has ignited worries about a slowdown in economic growth, driving a steep sell-off in shares of small companies after weeks of unease about how Trump's tariff plan will shake out and which industries they will reshape, investors and business leaders around the globe are hoping for more clarity. And that's the big deal here is just clarity.

People want to know what to expect. You can't move a whole factory in a day. It takes years to reshore manufacturing capacity and the bigger the company, the harder it is to do it. to expect, you can't move a whole factory in a day. It takes years to reshore manufacturing capacity and the bigger the company, the harder it is to do it. Yeah, this was Sean Frank's big point, which was, even if I wanna react to tariffs, it's gonna be damaging to my business

and every other e-commerce business in the short term. And so Trump clearly wants to make big, quick change, but there's still, you know, a lot of companies caught in the crossfires in the short term. Cool, well we got Ryan in the studio. Welcome, Ryan. Ding, ding, ding, ding, ding, ding, ding, ding.

Are you not traveling? Was yesterday, I'm back. You're back. Congratulations, enjoy. I'm back. You're back. Congratulations. Enjoy home sweet home. First, I mean, we got to ask you, are there are there any spies? How are you dealing with counter

intelligence, counter espionage these days? There's always spies. Yeah. We're good. We try to make sure that our code base is super buggy. So if you steal it, it just won't work. That's my main tactics. Do you think this is a symptom of like, just zooming out from the DL rippling thing and

anything that's happening at Flexport, do you think this is a symptom of tech becoming a little bit less greenfield, a little bit less positive sum. There's like two or three major backed companies in the exact same category now. And it's less of like the anointed power law winner who's going up against some company that's so sclerotic that there's just, it's just, it's just, oh, you're just stealing billions of market cap all day long and it never really matters.

So you're not, it's not so much of a knockout, drag out fight. Like how do you think about this in the context of the history of Silicon Valley and your career? Oh, I don't know. I mean, our issue was, I think, very different than deals. That was a few arch rivals going at each other. And someone, that's crazy.

I just read the deposition. That's crazy, right? Really crazy. Our issue's very different. It was a couple of employees who just like making bad decisions downwards, a lot of stuff on their way out and the company they started is pretty insignificant. My general is never, never punch down. But when you see someone committing ultimately a crime, uh, yeah, there's a sense of moral righteousness that needs to happen.

Some justice in the world. So, but it's quite different. moral righteousness that needs to happen, some justice in the world. So, yeah, but it's quite different. I mean, we're not this company is not a threat to flexport the way maybe deal is to rippling or vice versa. I don't know. Oh, yeah. Yeah, yeah, it's very different.

So yeah, I mean, on tariffs, like, what are you expecting? What are you looking for? What do you how do you think it's going to go down in an hour? It's Yeah, I don't know what to expect. I feel a little bit like, you know, maybe you're in Florida waiting for a hurricane about to hit Florida, man. I don't know if you get our American flag out and stand in the wind and

enjoy the show or be horrified to go, you know, get in your car and try to drive a thousand miles away. There's no escaping in your business. Yeah, there's no escaping. It's gonna hit hard. It's really ugly for our customers already. I mean, they've already on the, the China tariffs is hard to imagine

how they go much higher, really. Because of the, they added 20% to what was already 25%. And then the Venezuela stuff hit today, I think think which is another 25% on top of that because China imports Venezuelan oil. What am I at 45 plus 25, 70% tariff and then if you do steel or aluminum which if you have that component you're pushing into 80% duties go a little bit higher. I mean at some point you're just like, oh, okay. So I don't know how much worse China can get.

It can get worse. They can do whatever they want, I suppose. The tariffs on other countries is the big wild card here. What other countries get? You know, you've already seen Israel and Vietnam both went to duty-free on American imports. So we'll see. My impression from having talked to a cabinet secretary last week, that what he told me was that this would be April 2nd,

today is the start, not the end of the process. And he means that I think in a positive way for companies, that they're going to come out with a big bang today, it's going to be ugly, and then he would expect that countries will come to the negotiating table and make deals to bring the tariffs back down. But they want to send a very clear message that they're dead serious about, that they mean business, and then he expects countries will come to the table. But somebody read it the wrong way

and kind of retaliate with their own tariffs and then the administration may escalate further. We've seen that as a pattern. So my advice to all the presidents of the world is to go read the art of the deal and it's not that hard to figure out how these guys work. In my opinion. No, it's like similar to FF. It's like similar to FF.

It's like how does FF make investments? You know, read zero to one. Yeah. That's basically it. It's all out there. They're still doing the playbook. Are you, do you think, is this already happening or is it going to happen?

Companies sort of dying before they can onshore manufacturing? Is that something that you're super worried about or are people just battening down the hatches, like you said, Florida style, and just figuring out a way to, you know, obviously everybody wants to survive, but are we seeing sort of like an extinction level event

within e-commerce yet, specifically? Certainly not yet. It's very hard to say. I mean, the reality is tariffs alone won't bring most of these industries back to the US. The US dollar is just too strong. I was talking with a company yesterday that imports garlic. I was like, wait, I thought California has the best farmland in the world for growing garlic.

Why do we need to import it from China? But it's just, even with the tariffs, it's cheaper to import the stuff from China. And it's, you know, our soil is better than theirs. It's like California is the, Gilroy is like the garlic festival. I mean, this is the best place in the world to grow garlic.

So, but the US dollar is being so strong as the reserve currency makes it, no matter what you do almost with tariffs, it's still cheaper to buy from another country so I think that tariffs alone won't do it and nobody's there's no political will to make the dollar cheaper but if you want manufacturing coming to us the us just can't it just can't be that we're that much richer than everybody else on a dollar basis because it's kind of big. But haven't haven't some people argued that with extreme enough tariffs, it would, you know, get people to, you know, try to just move off the dollar. Maybe it's

impossible. There's got to be a number. Yeah, it might move off the dollar, which might actually cause their problem, not the way they intended to. Yeah. I'm not like, I've always been a macroeconomic skeptic. It was, I'm either too smart or too dumb to for macroeconomics I'm not sure which I Could hear it out there to have all these events. It all seemed more complicated than they were making it out to be So you never say I s I SLM all the different

charts and graphs Interfax Inter like that only in class. I ever bad grade in, in college is macroeconomics. Yeah. Is there, is there hope that, I mean, it seems like obviously there's like the micros, like what is the actual tariff rate in the country that I'm operating in, but then the real hope from the market, at least in companies seems to be, give me a framework and a real understanding of what the future is going to look like. And is there a chance, I mean, it sounds

like we're maybe even just starting that process of really understanding how the business community can respond to like a larger trade policy strategy. And like, is that what people are pushing for? Is it really more about just clarity over the long term? For sure, business needs certainty and clarity and it's really hard. These supply chains are multi-year, maybe, ideally decade plus investments that you're making

and how you're going to set up your supply chain. And if it's changing every single week, like you're just paralyzed, you can't make any decision at all. I think Canada stuff's pretty harmful in that way because if there's going to be tariffs on Canada, then there's going to be tariffs on Malaysia, Vietnam, India, and everybody else. So it makes it really hard to make any decision.

Let's say a company finally says, OK, it's very clear we're gonna have to move our manufacturing out of China, this administration. And the Biden administration, by the way, it was also ratcheted up the first Trump administration's tariffs on China. They didn't lower them at all. So both parties are aligned on that. So if that's clear and you're ready to make that move,

then you go, okay, where do we move it to? Unless you're ready to move to the US, there's no ability to make a decision at all right now. Do you think it would be better to take a more gradual approach to implementing these tariffs? I'm just thinking like, instead of saying, hey, there's a 24% tariff coming in on this country, it's like, no, we're going to raise the tariff 1% per month for the next two years. And so you know exactly where it's going. It's not gonna just destroy your profit margin today,

but if you don't figure it out in two years, like you probably will be done. And so you're signaling to the market exactly where it's gonna go, but it seems like I've never seen a policy like that rolled out. Yeah, they were talking about that. I mean, I think that was one of the things

that Trump or Lighthizer, one of the people close to the administration said they were going to do during the campaign. No, I think it was Besson who said that, the Treasury Secretary. That would make sense to me. Or even just giving people, you know, six months notice of this is coming, a year notice. You know, like some of the policies they've enacted have said, OK, this kicks in tomorrow or next week. And you're just like, oh my God, like I have a friend who's importing stuffed animals and he bought a hundred thousand dollars

worth of stuffed animals. And while the container was on the water, the booty rate went up and he got hit with this $20,000 bill. He didn't plan. I know. Like, oh, brutal, you know? And so you need some notice period that they haven't done that this time around.

I think, yeah, gradual ratching it up, but ultimately just providing clarity, like where are we going to be? It's also the ultimate challenge of the US system is, you know, here at least the two parties are mostly aligned, at least when it comes to China, we'll see about other we'll see what policies they actually roll out. But the two parties are mostly aligned on trade, they both hate trade right now. And so at least you have some longer term view of what it's going to look like if but in the US system where it can totally flip overnight, it makes it makes us very hard to deal with as a country. I mean, I, uh,

I think this is one of the things that has made it difficult for a deal like with Russia, for example. I mean, yeah, the two parties are just polar opposite in policy. So how do you, how can they make a deal with either party when it might just flip in four years to someone who's got, who won't hold up the deal? Yeah, I've seen, I've seen the, uh, like the flex port 747. There's one right behind you. Uh, if, if on-shoring really happens and there's major,

major production shifting the United States, what does that look like for flex port? Are you going to get into like more rail, more trucking is, is the market even big? How, how would you think about that? I would imagine there would be an expansion of the US opportunity, but like, what does that look like for Flexport specifically? Yeah, winners and losers in different parts of our business for sure.

The air freight business, a lot of our, we do a lot of e-commerce products from China to the US. Of course. That's about 50% of all the air freight in the world now is coming out of the Chinese e-commerce. And so that is at major risk, and the price of air freight will probably collapse. That'd be bad for our air freight business.

Our customs business is already booming as we help, we provide a lot of advisory services to help companies figure out what this means for them, how to mitigate, minimize duties, be compliant, get refunds on duties. Every year, even before all these new tariffs, $7 billion is going unclaimed in refunds that people are owed.

That's right. That's crazy. So we got people $140 million worth of that last year. Oh no, that's our goal for this year. But that's still a big market, you know? We should be 10 times bigger or even more than that. So that part of our business is booming. Trucking, we do about 200,000 truckloads a year.

Domestically moving trucks that have nothing to do with the international freight. That would probably grow. We'd want to get more, we will be getting more into kind of trade with US and Latin America, US and other parts of the world. I don't really worry too much about

the macro. Like, we're still pretty small. We estimate our market share is about 0.25 percent. Wow. Right now. So like, even at the market shrunk in half. Yeah. OK, now we're 0.5 percent.

You know, hold on to the business we have, but it's all of it. So I'm too worried. We've we okay now we're zero point five percent, you know, hold on to the we have but All of it so I i'm too worried. Yeah, I have a question about a market. I'm sure you've thought about so we've been having a bunch of You know, there's a bunch of new defense tech companies emerging Uh, you know, they have to move, uh big expensive Uh flammable, you know things around all the time Is that a vertical that like you guys have looked at at all because I think it's obviously you know

bunch of compliance issues it's it's yeah a little bit I think you tend to want to be more those guys want to work with people who own the assets interesting yeah I don't control security wise like actually I heard about this company that does trucking for the DOD or for big defense contractors and they ship missiles as like a very lucrative business. But they own all the trucks. And we don't, we're trying not to own any assets.

Sure. Very hard to maintain, to provide the kind of like ultimate security that one of those company needs if you're not asset heavy. So they'll, it's a cool space, but probably not one that we're best suited to play in right now. Yeah.

What about self-driving trucks? I feel like we're seeing so many, just like the Studio Ghibli moment, the Chat GPT moment, like AI feels so big, and yet the self-driving trucks aren't really here. What are the dynamics and do you have a timeline for that actually affecting the market? What's kind of the impact? It'll be huge. I mean it's the way Mo's here. My Tesla

mostly drives itself now and Tesla's making a truck so but I don't know how many of those Tesla semis they've really shipped and there's making a truck. So, but I don't know how many of those Tesla semis they've really shipped. And there's two different problems of the electric truck and the self-driving truck that maybe you'd have been conflated. Like, cause I think the electric truck actually has more problems than the self-driving truck. It seems like.

Yeah. Just because of like charging and range and different things that don't make that much sense for a, from what I've heard, I'm not that close to the physics of it, but the recharging network has just not been there for it. It's gonna be really huge though, and a massive impact on a lot of things. Right now, transit time even,

like a truck that drives 24 hours a day can cross the country. I think the loss is you can only drive eight hours a day. So, across the three times faster. Or today you would need three drivers and they charge you a huge premium for that team trucking it's called, where you have multiple drivers running shifts. And it's a shitty lifestyle like riding overnight, like never getting out of the truck as you cross the country. That is crazy.

And but you could be very competitive. I once drove across the country. That is crazy. And, but you could, it would be very competitive. I once drove across the country in 53 hours with four friends just taking turns. Were you doing a cannonball? In hardcore for broke college kids. There's something about that that sounds like amazing with your boys once, but I hear, I take your point on that. Maybe as a lifestyle it's tough.

We've been talking about it. Yeah, we want to do a race, try and get across the country. I think the record is something like 22 hours, which is crazy. Yeah, over a hundred miles an hour the entire time. Very illegal, very controversial. I stopped from Maryland where I'm from to Oklahoma. And actually the only reason we stopped,

the car broke down. We were gonna go the whole way without stopping. Yeah. No, the can't boss me all day. So the 53 hours actually there was a stint while the car was in the mechanic. Okay. Ignoring that part. Okay. Yeah. Yeah. You cut that out. Yeah. Yeah. And then we sat in the green canyon and like looked around a little while. Yeah. Yeah. Yeah. The real cannonball is from the Red Ball garage in Manhattan to the Portofino Hotel in California. And it's been done for years.

Alex Roy was the famous guy who did it originally. And then Ed Bolian destroyed the record during COVID when there was no one on the streets. It's a fascinating story. You should go check it out. Oh, yeah. This will be big in trucking. Oh, not to let jobs aside. I think truck driving is the most number one profession in 34 states by number of people doing the job. So that'll be massively impactful. And yeah, I think there's a lot of positives for the industry and productivity and stuff, but certainly it's an interesting problem for the society.

Yeah. Speaking on AI, something we've talked about on the show is like you had this Ghibli moment last week where something that was historically super time intensive and expensive and costly like if you wanted this sort of like Beautiful hand-drawn animation style. Yeah, you could go on Upwork or Fiverr and get that kind of thing done it's not gonna cost a ton most people wouldn't even bother to do it and I think that we are racing towards like the ghibliification of like all goods, right? On like a long enough time horizon, like automation robots

will just you'll have sort of an idea for something that you want. And in theory, like, you know, you just, you know, something could be made with no human involvement. And that could really drive the cost down. Now, if the cost of a lot of goods goes down over time, then in theory, there would also be a lot more sort of like a Jevons paradox dynamic where like if things get cheaper, people want more of them, which means that like we there's a scenario where like we're ordering 10 times as much stuff from China in, you know, 10, 20 years.

How do you think about just AI? Like it's easy to see how AI is, you know, going to make Flexport a better business by rolling sort of systems out internally and building these sort of customer facing experiences. But have you thought at all about like how automation broadly can actually sort of like impact like the flow of goods around the world at sort of a more macro level? Well, actually just coming back to the peopleification of everything. So I'm a published children's book author, you guys may know. Yeah, Big Ship and the Little Digger. I wrote this myself. It was not written by Chet Chippity. It was not illustrated. I didn't illustrate it. I just wrote it. So you can write a children's book about 45 minutes.

But the design took a long time. My designer who used to work in Flexport did this. Great. It looks great. Beautiful. It's a wonderful story. It took him like, man, the better part of like six or eight weeks to do that. Yeah. When ChatGBT released their new image model last week, I was like, oh, I'm going to write a new children's book. And I did it in an hour. And on my phone, I could have done it faster if I would have been on desktop and had parallel tabs open or whatever, but on the phone that gbt app didn't let me. But in one hour I was able to create a really cool book and I think I

could publish it and be done. It's also so cool the customization being able to like make it about your kid. I make these really cool iconic Flexport posters. We have 40 offices around the world and one for each office. That's super cool. Well yeah so using like iconic from the golden age of like ocean travel liners. It's amazing. Good prompt for that and it I asked the same designer to do it for me. One of these posters like you know I asked him six months ago and he quoted me something I couldn't afford. So using the children's and now I made them all last night in like an hour and I'm going to pump. Yeah, so let's use a children's book as an example. My son is obsessed with reading.

He's three years old. He could easily burn through five, six books a day. Like he would happily read. He'd probably read 20 new books a day if we had 20 new books available in the house. And he'll read, I bet you he'll read even more if he's the protagonist of the story. Yeah, exactly. So if like he's a protagonist, it's customized to his

interest. It's perfectly matching his level. But I also don't want him on screen. So like there's a world where if like the cost of producing the books drops, books are 80 percent less because there's it's just generated. There's a world where I'd order five times as much. And that means that you're going to be shipping in theory, theory like a lot more goods and that's just like for one Category right could be yeah And I don't be categories like that. I you know if I wasn't so busy

I would definitely try to set the Guinness Book of World Records right now for whoever wrote the most children's books 24-hour in a 24-hour period yeah Right now, before they shut down. In a 24-hour period. Yeah. 2,000 children's books. Can we hear a little history of the Flexport Lion and the generative AI stuff? Is the Flexport Lion coming back? Yeah, yeah.

Well, when Dolly first came out, I think every company should have a mascot. Ours is the lion because it's king of the jungle. You know, lion probably kill any other animal in the world. So that should be, but I wanted to claim that and make it really, you know, we're the lion. You can be something else like we're the lion. And so yeah, I probably, I like went a little crazy on Dolly when it first came out, making lion in a shipping container in port, whatever. Yeah. Yeah. So you should expect to see more Flexport Lions out there. Yeah. I remember you got me access.

You could have a children's book for your marketing. It's great marketing. Kids love it. Yeah. Parents love it. And then you should have a mascot. The best of this is by the way, Duolingo. Like apparently their owl is like.

Oh yeah. Their owl has like 50 million followers on the different app. That's amazing. Yeah, we need to instantiate the Flexport Lion with its own. Yeah, I need to make a full video about it. Yeah, it can be posting. It's not an obvious shipping reference.

I don't even know if lions are good at swimming or anything, but. Well, I mean, you do shipping over land as well, but yeah, it's not a pack animal and it's not a king of the seas. I would expect, you know, octopus tentacles everywhere. Who knows? Are there any transportation platforms? It's probably not the right way to think about it, but things like airships, you know,

drones that you're excited about. We had a founder on earlier this week who's building sort of- Conaplans. Yeah, it's like a seaplane drone excited about. We had a founder on earlier this week who's building sort of plans. Yeah, it's like a seaplane drone for like short term transport. You know, if you had that one that went viral, they like five guys, I made it in their living room or whatever. Yeah, yeah. David, David, co-founder.

I think sweet. If you like forgot something at home and you lived by a body of water. Yeah. Why? I don't know. Yeah. Yeah. Like I've been pitched airships. You know, there's been a bunch of attempts at that. I'd be curious to think as you

think about the future, 10 years out, what's what's exciting to you and are there is there a white space? That definitely be actually that man, I'm forgetting the name. Eli Dorado is a backer of this airships company. Yep. Actually, man, I'm forgetting the name. It's Eli Dorado is the backer of this airships company. Yep. Yeah, that one.

Pretty high potential. I met with the founder recently and I originally was very skeptical. I'm like, I don't think anyone needs this and sounds really complicated, whatever. But you walk me through it, it can carry the same volume as a 747, take three days to cross the ocean

instead of 15 hours, but like three days is pretty fast compared to a ship, could be a container. So if you get to a price point in between air freight and ocean freight, um, that's very compelling. It's just a new tier. And so some people opt into it for a certain class of goods. That will be very compelling as a replacement for air freight. That'd be cool. Well, does that kind of unblock the port system because we'd have a new set of ports we could go automated for day one? What's really cool about his model is that his idea anyways is that it would just go straight to your warehouse, not go to a port at all. That's amazing. Land at your wherever your

warehouse is and not need trucking or any you know land, just like laying on, it's pretty cool. Hopefully somebody awesome funds it because it's not cheap to go launch these things. And yeah, that's what real venture capital should be, right? Take some risks and do some bad stuff like that. So rooting for them. I think the self-driving ship, I see that all the time. It's really stupid idea.

Just because there's only, these ships are like 20,000 containers with 20 guys like there's just not that much labor savings here and most of those guys are doing maintenance like they're like painting it and yeah doing engine maintenance like you still need them even if it's self-drive there's one guy driving the ship like yeah well yeah you you've we've had pretty good autopilot and boats yeah kind of drives itself anyway. Right, like turn it into like- So I think the self-painting ship is kind of interesting.

Oh, that's cool. Just kind of painting itself as it goes. What about those crazy ships that have sails or nuclear power, different modes of power for ships? Yeah, the nuclear power I think is gonna be probably regulatory problem more than anything else. Like nobody really wants that you're new sailing into their harbor.

It's been probably the problem there. I've seen some cool ideas where like the ship, the mother ship would stay offshore like 200 miles and then deploy like little baby ships that would bring the cargo to support so that it never had to get within your coastline. But still a ways away. What about the sails? Yeah, so I've also seen, there's a really cool company called Clipper Ship,

really tiny seed round company. But with a big vision of little autonomous drone sailboats that would carry like five or six containers worth of stuff. And again, like sail, not to your warehouse, but to like a little tiny port, river or something, and set up their own network of ports, they're, they're trying to go live soon. I all of this stuff's pretty cool. And I have no idea. You know, it requires venture capital. And it's very interesting, you know, Founders One's the obvious one. But like, it requires venture capital and it's, it's very interesting.

You know, founder's funds, the obvious one, but like, it's really interesting to see when did they get excited about something? It's not everything could be the next space X and base X was a crazy vision until it worked, right. Uh, and could have lost a lot of money if it didn't. Yeah. What about space X point to point? Um, yeah.

D D uh, I mean, obviously the first, the first like beachhead is like the most Yeah, what about SpaceX point to point? Yeah. I mean, obviously, the first the first like beachhead is like, the most expensive like private jet traveler needs to get to Tokyo in like an hour from New York. And so they're like, yeah, 50k, no problem. But but where do you see that technology going over the long term? The problem is like flying in the ticket can SpaceX launch like in bad weather and it's raining or something? No, not really. I think they need pretty clear skies. But they're in Florida and Texas. It's pretty clear most of the time. You don't scratch too many. I think from a cargo standpoint, it's probably not worth any premium, because cargo doesn't care that much if it gets there in 15 hours or in 30 minutes. It's basically the same for most most everything for military

It's a big those are very big differences. Like if you need to get supplies To some soldiers on the ground in 30 minutes like that can be life or death versus 15 hours or whatever So like sure military applications are huge Rich people. Yeah Care a lot more about their time So yeah, I would be certainly bullish on that but it's just like hard. The cargo doesn't care that much. If it takes 15 hours, very rare you would spend that much extra for something to get it there that fast. I mean, maybe it would shorten down your trips, which would be nice.

One that I'm very excited about is zip line. Oh yeah. Um, which is I can't figure out if they launched or didn't launch yet. They're supposed to launch any day now in Dallas. And you'll be able to buy anything that's for sale in a Walmart on a drone delivery. Wow. In less than five minutes. That's amazing.

There's 25,000 items in a typical Walmart and 24,000 of them are small enough to fit inside their drone. Wow. And then I understand they're gonna go live, but I don't wanna reveal anything I'm not supposed to, but they're gonna go live with some restaurant chains. Oh, cool.

Get your burrito delivered. Get like a burrito in five minutes. This is one of those things, like, you know, they had the early hype where like everybody was like, oh, this is the future. And then like they had to do the thing and like actually like make it work. Got about it.

So the hype like dies down and then suddenly like a burrito lands in your backyard in five minutes. And you're like, we are so back. Last question for you. How do you think about sort of managing like the team and the company at a time when you're running a business that's, you know, most companies have the benefit,

like, you know, if you're running like payroll software, you can be like, let's ignore sort of like politics and like what's going out. Just buy on each other? Yeah, like let's ignore the world and politics and like what's going out. Just rely on each other. Yeah, like let's ignore the world and just like focus on our business and our customers. But like you're in a business where like in 30 minutes, they're going to announce some news that's going to be very impactful to your customers.

Like, you know, how have you messaged everything with the team? Like, do you got are you going to be like, you know, doing a war room as as the news breaks out? What does that look like? I'm curious. Oh, we always there's. We do. We have war rooms, as we call it, too. And there's like channels basically where we get together to go run a hootah loops

and observe what's happening in the world, orient ourselves who needs to know about this, make decisions, take action. And our ultimate, you know, my message to the team is what my dad used to tell us when we go camping. It's, you don't have to outrun the bear, you just have to outrun the campers in the next site over. That's great. And our competition, we've just gotta be better.

We can't outrun this bear of terrorists or geopolitics, terrorists blowing up ships in the Red Sea, or whatever it might be. But we can be better at responding to this than any other competitor. And it's a moment for us to actually double down on being the most customer centric. You know, like, and tech gives us a huge advantage here.

When the new tariffs hit, we will be ingesting that into our databases and publishing it to our customers within minutes, right? And our account management teams within the hour will have a plan, a script, and start calling down and letting people know what it means for them, how much it would have cost them,

start setting up advisory appointments to talk through. Things like in tariffs, it's your value of your goods times the tariff rate, times the duty rate. Well, there are a lot of perfectly legal compliance strategies you can do to reduce the valuation of your goods that nobody bothered with when it was times zero. You can get refunds as I was saying before. It's all about how do you respond to these things. Yeah, we think we have a big

advantage there. So it's fun as why Flexport is the most fun business in the world. Yeah, I don't want to sit there and run payroll or other companies. Get out there. It's an entertaining time to be in payroll. You picked a bad day for that analogy. Because it is high stakes. It's James Bond. My analogy is we got the we got the guns in the studio straight from China. The T-Mobile pistols. They're water pistols,

but we're having a lot of fun today. We got James Bond on the soundboard. We're having a great time, but thanks for stopping by. This was fantastic. Always great talking to you. Good luck on Chip Kramer tonight. Thank you so much. You know what happens with these guys,

maybe I'll need to come back and talk through when we actually have to. Yeah, yeah, that'd be great. We'll have you back, of course. Yeah, have fun later. We'll talk to you later. Great to see you. Fantastic. Always an entertaining interview. Thanks to Ryan for talking by. An absolute dog. So we got James. An absolute lion. We got James from Profound calling in. We are gonna be talking about, I spoke with James yesterday for the first time. What he's doing is absolutely fascinating.

He's helping companies understand how they are appearing in LLMs. Okay, yeah, let's bring him in. James, how you doing? Boom, what's going on? We got you. You live, can you hear us? Yeah, I can hear you. There we go. Fantastic. We're live, what's going on? Cool. How are we doing? We're you. You live? Can you hear us? Yeah, I can hear you.

There we go. Fantastic. We're live. What's going on? Cool. How are we doing? We're good. Can you start with just a brief introduction of yourself,

your company, what you're doing? Yeah, I'm James, co-founder, CEO here at Profound. We're a New York City-based startup. Yeah, we're building a marketing platform that helps brands understand and control how they show up in our responses. I'm we launched in August or 17th of twenty twenty four and kind of like came. Sprinting out the gate we we raised a three and a half million dollar seed round that was co-led by Keith Raboy, Coastal Adventures, with Saga, co-leading. And yeah, we've been growing pretty fast, pretty quick.

We have built this platform that's relied on by brands like MongoDB, Indeed, Mercury, Rippling, Ramp. Ramp. We love Ramp here. Yeah, talk about the genesis of the idea, because I think what you're doing, and we'll get more into how it works,

but what you're doing is now blatantly obvious. It's a blatantly obvious idea, right? Because all you have to do is compare, as search became a big market and companies sort of rapidly realized, we need to understand and control how we're showing up in results. There's a lot of parallels to now. But I thought your backstory of how you guys discovered

the opportunity in the first place at the beginning of last year was cool. Yeah. I mean, myself's, you know, myself and my co-founder Dylan, we were at South Park Commons, which is like a VC incubator accelerator. They have one in SF, one in New York.

We were lingering around the one in New York, spending our time trying to figure out what business we wanted to work on. And there was this kind of sort of ironic moment where as we were thinking about other businesses to work on, we kind of realized that we had just been using perplexity all day, every day for weeks or months on end without actually going and doing traditional blue link search. And yeah, again, it's one of those ones where it seems more obvious now, but this is it back then

But even at the start of last year chat GPT didn't have web retrieval So it was no good at such perplexity. It felt like this streaming to CDs type moment and We just went all in on that inflection point We said hey, you know either perplexity is just gonna take everything here because this is so good and it this makes AI answers makes so much more sense than blue link search or everyone else is gonna jump on board and do the same thing and probably closer to the latter is the way it unfolded yeah chat GPT introduced web retrieval mean, Adobe did this huge study that they released a couple of weeks ago.

It's based on a trillion web visits on American retail. And it's like, I think, 40% of consumers now are trying AI search for shopping for commercial purposes. So it's definitely different. We had Aidan from OpenAI on yesterday who said that anytime he wants to buy a product, even if he's just buying hand towels, he just does a deep research report.

And he's like, it's worth just waiting five minutes to figure out what's the best product based on my interest. I'm curious how aware, it makes sense that companies like Ramp are using these tools every single day and they start to realize, hey, this is a product discovery mechanism we should get on top of understanding

how Ramp is appearing in results. But for how aware are legacy companies, sort of multinational public companies aware of how, do they realize this is almost like a hair on fire problem yet or do you have to kind of explain to them like, hey, by the way, you know, 20,000 people are searching about your products every single day and like you have no grasp of how you're appearing

or what that's causing people to do, et cetera. They're all over it. I like reject this thing of the income. I think the incumbents all had their lunch stolen in the early 2000s. And I think that everyone's like wiser now when they can sniff a platform shift. We work with some really big companies. Like I know everyone's got the you know, the founder yet, but we genuinely work with some of the biggest like Fortune 100 companies in the world. I just can't say their logos because they just don't like that. But yeah they're super clued up, they're super wise to what's going on.

They're maybe a bit slower in terms of the workflows because understanding is very different to like taking action and like trying to improve the results but I mean as an example to give one of our customers who I won't say who it is, but they're a big company, 12,000 plus employees, they did a big global PR push around this new product launch last, I think, a week or two ago, and they saw a 50% increase in their visibility on that, their visibility in answer engine responses. Without giving away the secret sauce, can you just give us some general guidelines for how a company should think about steering, how they show up in LLM responses?

Because you could imagine everything from like, do more SEO stuff, get on Reddit, make sure you're in the next crawl in the pre-training data set. Or you could even go and say, hey, there's some inaccurate information about us, let's just go directly to OpenAI and say, hey, can you trim this out of the data set?

Yeah, so I guess there's a sort of wide aperture or sort of philosophical response to this, which is I think understanding that the failure mode here is to think this is like traditional search, where traditional search was essentially a marketplace system. You had the website and the end user, and the Google index just helped the end user come into a website, maybe top a funnel and thumb around in the ecosystem, eventually get pushed down the funnel into a conversion event. AI Answers, there's three parties acting here where we have the same website and the same end user but sat in the middle is the answer engine. The answer engine changes everything because it's

not connecting the two. The answer engine is essentially for all intensive purposes stealing the relationship from the end user or stealing the relationship with the end user from the brand. So most brands aren't really grokking this idea yet, but most brands are about to lose the majority of connection they have with their end consumer. Because now when I'm researching a purchase, I go to ChatGPT.

And if I need more information, I send a follow up question to ChatGPT. There's no need to click out. And eventually, I mean, if you read the Stratecari article that came out the interview with Sam, I think this week or last week, it's obvious's obvious that open AI are gonna go into shop ability So we're gonna see like a gentic browsing a gentic shopping start to take place and you will you will transact Within these answer engines you will consume media within these answer engines

You won't need to go we're going into a zero-click future So as a brand the impetus, you know going back back to that sort of philosophical point that your impetus is how do I distribute information to these answer engines in real time accurately. The first step is like to just understand what the hell is going on. So you know if I'm ramp and I want to show up more in accounts payable, Cool, let's like run a bunch of interrogations. Let's see how the answer engines respond when we send a huge variety of questions about accounts payable, open-ended questions, not brand direct ones about Ramp.

Let's see where they go, which sources do they go to, does ChatGPT go to, or Perplexity go to, or Copilot go to, to get that information. And then from there, we can start building strategies. I mean and ramp you know that we just published a case study with those guys so it's public information they increase their visibility by 7x in one of the indices that they were looking at by just looking at what was going on and what they could do about it then I guess John to give you a more direct response like you know tactical stuff LLMs.txt our website tryprofound.com we get

as our LLMs.txt now is getting as much traffic as our sitemap which is pretty interesting. We think like very rich extensive websites you know websites like I don't know Stripe is an example we have tons of documentation I think LLMs for dot txt will be very interesting because it's just essentially cramming a Huge txt file of everything all onto one page because answer engines don't mind that I think going you know just sort of cycling through other ideas You know things that we're seeing work are lots of structured data is very important like you know car. Lots of structured data is very important like you know removal, verbosity, you're creating content essentially for a retrieval agent to pick up, not a human. Images are useless, answer engines don't care about images so like kind of ignore them to an extent. Metadata

you know needs to be very thoughtful like you can essentially you can just spoil the whole article with your metadata and that will often be like pretty effective. So, I mean, I could like, I could go through, I could cycle through this. Yeah, what a, I have a couple kind of questions. You're sort of building in a, what's a new category. Do you call it a AEO, like answer engine optimization?

Do you have, have you coined it yet? Obviously you want to own it. Yeah, I think you have to let the kind of market decide what it's going to be called. AEO, AIO, LLMO, GEO gets thrown out. Generative engine optimization gets thrown around a lot. Considering we're all like techno optimists and Silicon Valley is meant to be full of techno optimists.

The desire to use heuristic is quite interesting to me. I've seen like so we, as human beings, we love to use heuristic. We just want to say this is SEO for AI, but there's all kinds of like new surface areas that just didn't exist before. Yeah. Can you talk about, do you have any type of vision

of what paid ads in LLMs will look like? I had gotten multiple pitches over the last year of people that were building these sort of like ad networks to fit within different LLMs. And my general read is like, I sort of believed that, paid ads would be heavily integrated into LLMs, but I sort of felt like it might, I wasn't necessarily convinced that,

in a world where there's an infinite number of different answer engines, that everybody has a different favorite, maybe this sort of global network makes sense. But then if OpenAI is getting long-term or Grok or whoever's the sort of power law winner, if they're getting 80% of the traffic, maybe they end up with more of a meta-style ad network where they just build it from scratch.

But I'm curious what you think. I mean, I definitely kind of think, well, I believe there will be a more fragmented marketplace this time around. I think there's just more, everyone knows what's at stake here. Google search has been the biggest monopoly in the history of the internet and I think there's more capital, more energy going into trying to ensure that doesn't repeat itself this time around. But answering the question, I think it's actually two things. I think it's generative advertising in a conversational user experience will be that the convergence of those two things will be one of the most powerful unlocks

in the history of marketing. Language models are really good at language and being able to synthesize net new ads on the fly that are perfectly tailored to that exact moment in the exact conversation in the exact way. Yeah, it's compelling. I think is about to melt. Marketers brains on and on the efficacy of how powerful that advertising medium is going to be. Yeah. I mean, I'm, we want it to happen. We think it's very interesting and we think it will speak. You'll, it will be a very obvious next move for our business. Um, I don't know if we're not holding our breath right now.

I don't think, you know, I'm not sure if it, if it will unfold like that, especially with open AI, you know, they have. They have that corporate structuring, I think, is a bit of a hindrance. Just the kind of values of the business. I don't know. Your speculation is as good as mine. Yeah. Well, very cool.

I'm sure you're going to be raising a lot in the next few years. So when you're ready to announce anything, come back on. Come back on. And send me, keep sending me different learnings and stuff in the meantime. I think we just have a ton of founders in our audience that probably aren't taking LLM optimization seriously enough

now. So go DM James or sign up for a demo or whatever. And it's great having you on. Thanks for having me, guys. Yeah, congrats on everything. It's cool. Cheers. Thanks for a demo or whatever. And it's great having you on. Thanks for having me, guys. Yeah, congrats on everything. That's cool. Cheers. Thanks for stopping by.

Later. We got Quaid in the waiting room yet? We got Quaid coming in to the Temple of Technology, breaking down watches and wonders, which of course is, it seems like the biggest watch event of the year. Every major watch brand announced new watches and we're gonna get the update from Quaid. I'm very excited for this.

We discussed the Vacheron Complications watch that launched but I wanna hear about Patek. I wanna hear about Rolex, the Landweller. I wanna hear about everything Quaid has to say. So break it down for us Quaid. How you doing? What's going on? It's James Bond Day.

It's James Bond Day. I hope you have your gun because we're all secret agents today on the internet. What's going on? What time is it over there for you? It's 9 48 PM in Geneva. I'm in a tiny little Geneva hotel. So apologies for the background, but we're on the ground.

You look great. Yeah, break it down. What is going on? Why is everyone in Geneva? What's going on in the world of watches? Yeah, it's watches and wonders right now. So it's kind of like the biggest year, or biggest week in watches for the year typically.

It's when the watch world comes together, a lot of the brands come out and they reveal the new models, discontinuations, and everyone comes out here and nerds out together. So what, what's making a splash? Like what are the biggest announcements? And then what are the, what are the announcements that I might've seen that are kind of overrated? Yeah. So it's,

it's typically a time when brands like Rolex and Patek come out and they announce like iterative improvements on their models. I'm sure a lot of you folks have started to see a lot of the press coming out of it. We got quite a splashy year, specifically around Rolex. It's not very common for them to come out and release a new model. And so they dropped the Landweller.

And it's definitely penetrating popular culture a little bit more. I was in LAX on my way here, and a bunch of people who clearly don't talk about watches were talking about the Landweller and that excited me. But so that was the big splashy one. First new model in a lot of years.

What's the hardcore enthusiast collector reaction to the Landweller? I look at it, I'm like, okay, you took the best of AP and you combined it with a day date and that seems like probably like it's gonna sell well. Right, I just look at the bracelet, but like as a very much like a hobbyist enthusiast, you know, I'm curious what the sort of on the ground

reaction is to the new model. Yeah, I think there's the consumerified reaction, and then there's the nerd reaction. I think the consumerified one is integrated bracelet homage to the late 70s Oysterquartz. I think Jordy, you're spot on there. It's the first moment in a long time, or maybe ever, where I think Rolex is building a fully integrated bracelet

that really puts a model directly in the Royal Oak Nautilus category. And so Rolex has been largely dominant without doing that. And, and so now that you have a bracelet where I'm wearing a Royal Oak today, like I haven't put on the Land Dweller, but does it make sense to have both in my collection? I think it's like you start to ask that question, which is quite exciting for the watch nerds. They released a new caliber with it, the 7135, which has a new escapement in it. And so like, for most people, they're gonna buy the watch because it's a hype new Rolex.

I'm sure every 80s lion's getting blown up right now. But for the watch nerds, it's just a really efficient new escapement. It's pretty exciting to see it come out for the not watch nerds in the room. Like the escapement regul it's pretty exciting to see it come out for the not watch nerds in the room. Like the escapement regulates the hairspring. The hairspring is what you're winding to power the watch and it's kind of being regulated and releasing and that's what's driving power to the gears. And so super nerdy, but to have the moment where they not just make a new model and make it

exciting, but they also invest in kind of the technology and push the innovation forward in the watch perspective. Then to have the confidence to drop a new caliber and a new escapement in a sport watch, I think it's just a ballsy Rolex move. I think the watch world likes it. I think everyone wants to like it. That's cool. I'm curious, how do you guys think about estimating how these things are going to price? Obviously as soon as an AD releases a land

dweller from their hands into a consumer's hands, some of them will get listed on Bezel immediately. Do you have any sort of sense of how this is going to price? It's a little bit different than seeing a new GMT release where it's a different color way, but it's certainly not a new model. Yeah, it'll be interesting. And I think it's very different color way, but it's certainly not a new model. Yeah, it'll be interesting. I think it's very hyped and it falls right into the hype stream, everyone's going to want this.

I'm sure 80s lines are getting absolutely blown up. It's also expensive at retail. It's a $14,000 watch, I think is the retail on it. It's $1,500 more to get at Daytona at retail. Granted, those are obviously impossible to get, so it's not even real numbers. Whenever Rolex drops a new model, specifically one that's desired, you pay a premium to wear it first. And so I'm sure if you want to be courtside, you know, wearing your first Landweller, you're

going to pay an insane premium on that. I would not be surprised if these things are selling like well over double retail. That probably seems like the entry ticket even at a stable market. But we'll see. It's like, you know, there's not a lot of hyped Datejust out there. Even the hyped Datejust is still trading in the mid-teen. So it's certainly a new market, but I think it's going to be pretty frothy with my guess. Can you talk about some of the other launches and how they've been received either this year or specifically at Watches and Wonders? Yeah, so I think it's been interesting.

Usually when it ends up happening, as I mentioned, you'll drop a watch, it'll be popular, even if it's a funky watch. We saw the Day-Date with the emoji. Yeah, I saw a Tetris one that was kind of wild. Yeah, like it's crazy, but because there's inherent scarcity in a type, you end up seeing these things trade for insane figures. I think there's a lot of other really exciting ones that drop this year. They don't touch the Land Dweller, but it was kind of a theme of

really interesting color dials. You had the the sprite get kind of a big brother, the green and black GMT that's a left-handed. I never thought, I thought they were going to launch that model and then discontinue it because it just inherently was weird and a destro. But we got a white gold version of it with the first ceramic dial that Rolex ever made. It's all green. It looks kind of hulky meets the sprites. That's exciting. You got this crazy ironstone, tiger ironstone dial for the full gold root beer, which is like gemology Mix of tigers eye and all these other crazy metal or crazy stones

OP colors got some new ones. They brought in like a hyped turquoise dial in the Daytona So it seems like they're investing in technology But they're also playing like right into the hype cycle and giving color dials and things that are strong. How are some of the Holy Trinity brands playing watches and wonders? I saw a launch from Vacheron. I saw some Patek news that you guys broke down

on your ex account. Can you give me just an overview of like, how big is this year for each of the Holy Trinity? Yeah, it's not quite the level of Rolex, I would say. Obviously, Vacheron's had a big year with the 222s, kind of riding that lightning. As far as Patek goes, we got the 6196P, the newest iteration of the Calatrava.

The watch world loves it. It's kind of being hailed as the best modern Calatrava we've seen in a really long time. It has that amazing salmon dial at the market level. So still active, but I would say more like a normal year than kind of Rolex having the standout new model. What is the general sentiment, like industry sentiment right now on the ground?

We obviously had the COVID zurp, boom, and then things crashed. There's a lot of models that are down 50%. They're obviously still trading above retail, but is the sentiment good, even though we're maybe back to like a new normal, but the new normal is just like, sort of higher than 2019, let's say.

Exactly, like I think the hype models are still hyped, they're still trading well above retail. Daytona 15.5 retail is still trading in the low 30s. It's not a $55,000 watch anymore, but it's still trading at a meaningful premium, still very hard to get. And I think the correction that we saw over the last two years actually, in many ways,

I think accelerated the market. You have a lot of people that were watching the price of a Daytona being $55,000 and just feel prohibitive to enter the market there. Now all of a sudden see the watch at the low 30s and they either feel like they're buying the dip or they just want the watch well enough that they are willing to make that price at that point. So we're seeing a lot of energy come back in the market. On our side last month month was the best month we've ever had ever, so we continue to grow. Congratulations. We love growth here.

We have to shut that out. It's fantastic. Congratulations. Thanks, guys. But yeah, so I think the market's still frothy and it's there. A little bit less speculative than it's ever been. I think people saw the highs and they saw the drop and now they're you know Being more careful, but still a lot of watches to be bought. We love a little bit of froth

Not as big on speculation, but I love we love a little bit of froth of the froth Is there anything else anything else? Yeah, anything else that's been anything surprising from from this trip so far that or is it all kind of Expected all you'd expect. It's always fun to see Everyone in Geneva walk rocking the most fire watches ever and they're just casually on the street I had lunch today and I think I saw two crashes a bunch of open works like all sitting in the same vicinity And it's fun to see how this stuff regulates on the secondary market Like we're already seeing these celebration dials, you know, they used to be trading in the mid

teens, we have a seller that's opportunistically listing them in the thirties now trying to get this speculative buyers to be ready to move. But then we're also still selling them, you know, in the low twenties, right? So like, it'll, everything will shoot up immediately and then it'll find its way down. And if it's a hype model the celebration model and our dial is inherently a crazy watch like it's I people who rocket hats off to them because it's an impressive watch to be able to pull off but For the ones that have staying power and they're discontinued and have a lot of demand. Obviously the price shoots up Can you talk about some of the smaller brands? What's going on with FP Jorn and some of the more challengers, the up and comers, the

brands that folks might not have necessarily heard of, but are making big splashes in the last few years? What are they doing at Watches and Wonders and what are they doing generally? Yeah. So I think most of the brands are here. Even some of the big brands tend to be a little bit quiet, even not just the independents. AP didn't participate in Watches and Wonders but did like some quiet announcements of new ceramic colors and things like that.

I went today, there's a small little- Wait, just one step back, is that like interpersonal dynamics? Like they don't like who runs the show? Like why do you decide to not be at the biggest, you know, watch event of the year? I don't know if I don't have like the nuance year. I don't know if they, I don't have the nuance there. And I don't know if reps in them are not participating and things like that, but I just know they're

not making as big of a presence as other brands are. And I think that's just a selective choice. But obviously they announced, they love the ceramics and they announced a new blue ceramic that is aligned with the color of a specific sky in a Swiss Valley, which is very AP and super cool of them. So yeah, they're just doing their thing. And on the independent side, there's a fair actually next to Watches and Wonders. They're in the same little area by the Geneva airport that is focused on specifically independence.

And so after you spent time there today and you're kind of working with brands like Ming and kind of these new up and coming brands that are doing really cool stuff. So you get a mix where it's a fun moment where I think a lot of attention is brought into the watch world of Watches and Wonders and I think Rising Tide rises all ships in this kind of stage. That's awesome. Love it dude. Well thank you for joining us at 10 PM.

Your time, have a great rest of your trip and thank you for responding to John and I at all hours of the day. Every time we have watch questions. With like the most obscure wrist checks. Hey, we saw this VC with this watch, let us know what it is. And you're always on top.

You guys are the best. We appreciate it. And thank you. If you sell watches, I am available 24 seven. Thank you. Yeah, it's been fantastic working with you and partnering with you. You're the best. We appreciate it. And thank you. It's Elves Watches, I am available 24 seven. Thank you. Yeah, it's been fantastic working with you and partnering with you. You're the man.

Have a great rest of your trip. Yeah, safe travels. Thank you guys. Talk to you soon. Bye. Good timing. So much watching you, I'm glad we were able to have him on as our official watch correspondent.

I love this stuff. Well, next up we have Sarah Gwau coming into the Temple of Technology talking about, she runs a fantastic AI podcast if you're not familiar, also a big time investor. And wasn't she the reason that Andrew Reid joined Sequoia? Wasn't that the story? I think that was it.

Yeah, it was about the backstory. Yeah, and she's here now. Welcome to the show. Sarah, good to have you. Hey, hey. What's going on? It's great to have you. Hey, hey. Hi. What's going on? Great to have you. What's going? Thanks for having me. What's new in your world? How did you process the Studio Ghibli moment?

How are you feeling? I mean, you've been bullish on it for years now. How has it updated your world model and what's exciting going forward from here? How has it updated your world model and what's exciting going forward from here? Well, it's super cute, right? Start with that. I have a lot of, generated a ton of images of me and my kids and my family and my friends. So I think it's not be ignored,

how much people actually do want to create. I think it updates, I think it should update a lot of people's world models in terms of how early we still are in quality. I think the fact that, like quality is a very broad term. I think the fact that you had image generators make things that were beautiful or realistic, I feel like people kind of thought that,

you know, to some degree, like images were solved, like other like other domains were already more well solved but like what I think the GPT-40 at Studio Ghibli moment taught us is first of all it's like a different technology for image generation but it allows a lot of controllability and there's more knowledge of like why the image is the way it is And so I think we're gonna keep seeing a ton of improvements in our ability to create different things that surprise people.

Have you gotten a chance to dig into how much of the, I mean it's clear that this new model, whatever they're doing is much better. How much of it is just the design, the algorithm, the strategy versus scale? And I really hope that we have almost like a deep seek moment where we're like, oh, now it's a filter on Instagram and it's just a button and it takes one second

and it runs on your phone where you've compressed it down. That seems to be a trend in all of these models. Something comes out, it's really cool, it's really big, it's really expensive, then it gets really cheap and quick. What are you expecting this year as this evolves? And do you think any of those trends will unlock new use cases? I mean, I think this system can do things

that were really hard to get right consistently before. And it is different, I mean, I don't work at OpenAI, but lots of people believe that GPT-4.0, it's not a diffusion-based image generator. It's just starting with noise and you gradually cleaning it up the way mid-journey models supposedly work. You're building images piece by piece,

sequentially like you have tokens in a language model. And if the image parts are more like words in a sentence, and you're creating the image one element at a time, so it's like technology brothers in a cyberpunk city with a blue dragon, it's understanding the request with language, it's connecting the words to visual concepts it knows, and then it's doing it like step by step.

And this is great because it's more controllable and it's really high quality, but it requires a lot of compute, which is why Sam was talking about servers melting and it's still slow. I would take like every bet that in general, all types of AI capabilities due to competition and continued investment and technical progress and distillate,

it all gets cheaper and faster. So anybody who's building with this stuff or using it should expect that curve to continue the way it has for the last 18 months. And I think a lot of it will be open. I mean, opening, I just said they were committed to this too. And so I definitely think that the data would suggest that we should continue

to see like new capabilities as the models continue to like invest in or the foundation model companies invest in multimodality and continued scale. How do you, what advice would you give to somebody that's doing anything around image generation at the app layer? I think that prior to last week, if you were building like something that generates Facebook ads, you felt pretty good because you were like, well we have great UI and like customers care about workflows and like you know we help with this effectively baking in prompt engineering to get great outputs. And then OpenAI releases something

that consistently one shots prompts with three words, and it's a fantastic output. Do you think that if you're working on image generation or ad generation SaaS that you need to pivot to just having new ideas and thinking deeper into the stack? Or do you think that there's, do you think that you can still stay ahead

by focusing on workflows? I definitely think there's a lesson here of watch what the labs are doing, watch what anybody who is doing like core research is working on and you don't want to fly too close to the Sun. Right? I do think one surprise might be what Anthropic and OpenAI explicitly care about is like AGI or ASI, whatever you want to call it, right? And one might've argued that like image generation voice,

like these things are not on the path to AGI, right? They're products you kind of get for free. I think there's like maybe two lessons here for entrepreneurs. One is, well, these companies, they do care about making like end user progress and commercial progress, in part because they need to build a business that requires consumer engagement to keep justifying the training cost and the research cost, right? And so I think if they feel like there are capabilities that fit into a broader consumer engagement or like productivity platform, they're probably going to pursue them. But I also think that like the, at least my experience with creative tools is that people want a huge amount of control

and like not one tool will serve everyone. And so like the things that OpenAI and the labs have produced are very democratizing. And yet like that is lowering the floor for if you want something that looks like a decent ad. I also think there's a lot of room to continue working on the last mile and raise the ceiling. And we're going to have just much better content, much

richer content, more diversity, higher quality from people spending a lot less money. And there is opportunity in that. Yeah, I think last mile is just an interesting framework where the base models are going to get you to pretty great. And then how do you get to excellent? And there's probably a lot of value that you can capture by delivering excellent.

And I think you can make reasonable predictions about what the labs care about. Right? Let's just use some examples. Do they care about cogeneration? Yes, they care about cogeneration. They think it's on the path to better reasoning. But do they wanna build every workflow

for a certain type of code base or migration, every workflow and serve it like in customer service or law or finance or accounting or even, I don't know, video capture and editing? Like, absolutely not. They neither can nor want to do that. Yeah, it seems like there's been this trend over the last few years of maybe don't train

a foundation model, stick to the application layer and then go operate on highly protected data sets like legal or finance or investment banking, medical records, et cetera. And I'm wondering if there will be a version of that, that relates to image generation. Um, but do you think we're kind of at the end of that trend or do you think there's more niches that people can discover if they just think really hard about where the labs aren't building towards and then go find something

really cool? I actually think we're still pretty early in quality. In your artists and advertisers and communicators, the specificity that people have for what they want in an image, the concept here is controllability. I think the ceiling is really high. And to the point at the beginning, I think people thought we were kind of done,

we're not done. And so I actually think there's still opportunity for large companies here. And then relatedly, video is much harder than images and requires different architectural change. And so if images are this expensive and slow to generate today, I do think also efficiency is going to matter here and efficiency is going to matter here

and workflow is going to matter here and collaboration is. And so I still think there's opportunity for other companies that are not necessarily just training pure text damage models. Yeah. Oh, sorry. I was going to take it in a different direction. I was going to ask,

it seems like there's been this evolution of the value will accrue to the foundation model layer. Now it will accrue, at least in the short term, to the application layer. Every foundation model company kind of has a dance partner on the distribution side, whether it's Google, obviously, has their own distribution

through their apps, and Meta has all the different social media apps. X and XAI are now part partnered and together. Even OpenAI has gotten so many people to install the OpenAI app and the ChatGPT app. Do you think there'll be an increasing trend of, hey, yeah, it's not enough to just be a foundation model company. You got to find a dance partner on the distribution side. If you really want to accelerate over the long term and remain relevant.

I certainly don't think it hurts, but the best example would still be OpenAI and ChachiPT. Yeah. They didn't actually, like their distribution is their own. Yeah. Right. So it depends on how novel the capability is. And so I think there's a deeper question in like, maybe that you're implying that in what you just asked of

like, well, are people gonna build new experiences that are so different that they can create their own distribution? It is fascinating that they have this deep partnership with Microsoft. I've used Outlook for one email inbox for the last two years. Haven't seen any openAI products in there.

I don't know if I just haven't clicked the right button, but doesn't seem like Microsoft is really pushing, like, hey, we're gonna build these models in, although they've talked a lot about copilots and different Office products. But, Jordy, what's your question? Do you think that it almost feels like there's never been more hype for AI,

but I almost feel like it's never been more hype for AI, but I almost feel like it's like underhyped. Like you shared an article yesterday or a study that shows like AI therapy like actually seems to work really well. And the idea that like society broadly, everybody would have free access, infinite access to high quality therapy,

like should probably be like the top story in the world because of how transformative it could be if every individual could understand themselves better and sort of, you know, mature and whatever they're getting out of therapy. It feels to me like just AI broadly is still underhyped even by the cohort of humans that is like, you know, like fully AGI-pilled.

I think it's, I think it's strongly hyped. Maybe that's the answer. Like it is still underhyped and the things that people are really excited about are not necessarily the right ones. Maybe I'll go back to like the Microsoft thing for a second. This is not like, I mean, clearly Sia has done an amazing job with Microsoft,

but it's still a very large beast. And I think it is like kind of impossible to overstate how hard it is to get existing products in existing businesses to move quickly, right? And all of this shit has happened so quickly. And like, should there be intelligence in your email? Absolutely, right? That technical capability exists today,

but what does anybody who is a traditional email vendor, Microsoft or Google, navigating here? And they're like, oh, what does our user agreement say about if we can process that data? What is the safety consideration can process that data? What is the safety consideration around processing that data? What is the user promise around privacy? How much is it going to cost? Do we even have our infrastructure set up to share that data with model inference? I think it's complicated to go deploy this stuff, especially at scale with organizations that by virtue of actually having users and customers are more conservative. And so I think people can

go challenge it by... Yeah. I mean, staying on email, I was setting up a new Gmail inbox and there's Gemini buttons everywhere, but they don't seem to do anything that I want to do. It's just like, oh, give me a two line summary of this email that I could already kind of skim. It feels like, you know, during the mobile era, there was this whole drum beat of like mailbox. I don't know if you remember that company that got acquired by Dropbox. It like went viral. Everyone was using it.

It introduced a couple different UI patterns that were really cool and then eventually adopted. And it was never like a power law outcome, this massive trillion dollar company, but it was like a really cool product. People enjoyed it. It was probably a good outcome for the investors, the founders, the users. Everyone had a good time. And I feel like there's a little bit of a meme right now that like, oh, you're just a chat GPT rapper.

You shouldn't even go and try and build that. And I've always wondered, should we be telling founders, just go build and maybe don't even worry if it's aligned with venture capital necessarily, it's okay to go build something because there's so much opportunity with these new tools. You might become really big, but you also might just build an okay subscription business and people are paying 20 bucks a month for it for a while.

And then maybe you get steamrolled, but maybe you land somewhere great and you get acquired somewhere and it's all worth and at least we get the product. It just feels like again and again, I think of a product and then I can reason my way out of that's not a venture bet, but we don't get the product in the interim interim. And I'm like, I just want the product right now as a consumer. Yeah. I don't think you can give entrepreneurs advice on things that are really about personal motivation. Sure. If they wanna just build the product,

go build the product. If they wanna build a hundred billion dollar company, they should think a lot about what's gonna make a hundred billion dollar company. Yeah. We're explicitly not gonna back anything that's gonna be a small outcome that is a tuck in, at least that we believe is, right?

But I also think that there are spaces that people think of as very red ocean that people have creative approaches to. What does red ocean mean? Red ocean means like- Like just overly complicate, your competition, blue ocean's opposite, right have competition, the blue ocean's opposite. The opposite of blue ocean.

Yeah. Exactly. Like a lot of people are fighting over it. It's not like an unknown market. Like, you know, I think I'm pretty excited for Notion Mail. Lots of other mail services exist as you've heard. Yeah. Have you, I'm sure you've looked at a bunch

or gotten pitched a bunch. Have you done any AI roll ups or do you have a broad thesis there? When I look at some of these strategies where sort of startup people, like basically are trying to reinvent the private equity playbook being like, we're gonna buy businesses and make them more efficient.

Like it's sort of the same thing as like, you can make them more efficient with software and now the narrative is AI. How have you thought about opportunities like that? There's obviously a bunch of them, and I'm sure you've probably seen them all. Yeah. We have something still in stealth in the portfolio

that you might characterize this way. I'll talk about what I think the component parts of this thesis are, and probably piss a bunch of people off by starting with, I think that there are asset classes where finance people are pretty good at finance. Right? Private equity is a mature asset class

and a bunch of engineers being like, you know what? We're gonna be really good at underwriting private equity. I'm like, why? Why would you have any alpha in this? I think you seem really smart, like a very good engineer. But the component pieces of, I think it's really interesting when people just discover other sectors that have existed for a long time

and don't think about what the basis of competition is. Well, that's the classic Silicon Valley approach being like, I'm an outsider. I know how to do this better than you do. And then it's like, private equity an outsider, like I know how to do this better than you do, and then it's like private equity is like the most optimized asset class ever where there's people out there that are like, I will buy this knowing that I will only get a 7% return,

but that's okay, because I'm gonna do it enough times throughout the fun life cycle that it's gonna work or whatever. So I'm glad we're on the same page here, or I'm like, I'm pretty skeptical of most of these things that start with we're just better at finance. But being, I could imagine hiring or actually being good at the under, like the asset selection

and underwriting piece of this as being a baseline for a roll-up type play working. And then the other premises here are like, we think that there are a bunch of sectors in the world that would benefit a great deal from technology or AI and benefit being like it shows up in the growth rate or in the EBITDA, right? Pretty quickly, but they're not, by virtue of the industry structure, they're gonna adopt these technologies very slowly. They're fragmented, they don't invest in technology,

the user base is really far away from Silicon Valley and sales is hard, right? Like that's kind of the premise. And maybe there's some broader technical thesis about why working across these companies is interesting. I just said there is something in our portfolio that you would characterize as a play on this. And I would just wanna believe

that these component pieces are true, right? The team can be world-class at finance? The team can be world class at finance. The team can be world class at the technology piece. And the technology piece is going to translate to something that is not incremental, but fundamental to the quality of the business and your scalability in an industry or ability to compete.

You heard it here first, an HVAC roll up for sure. HVAC plus DocuSign printing money. How do you think about, as a GP, wanting to constantly learn and learn about new industries and get enough conviction to make bets in areas where maybe you didn't have a ton of context five years ago, while at the same time knowing your lane and having areas that you're super confident in and having a deep bench of sort of like experts because like the thing that I think

is you know every every VC became an AI investor over the last you know year and a half two years but also a bunch of people became defense tech investors and a bunch of and like for us like we angel invest it's low stakes if there's a founder we like we'll put money in and we want to support them but then you're running a firm you kind of have to know your your edge and your lane and For us, we angel invest, it's low stakes. If there's a founder we like, we'll put money in and we want to support them. But then you're running a firm, you kind of have to know your edge and your lane. And I'm curious how you sort of like, sort of balance that,

like what and think about like your sweet spot. Yeah, it's a pretty poor question. I was actually having this discussion with my friend Eric Vistria, who's at Benchmark. And he is like an infrastructure enterprise software person by background more like me. And we're talking about companies that are out of domain. And his point which I think is like pretty aligned with my view is if you are too familiar with the status, now I'm going to like make fun of myself because I just said all this

stuff about the private equity roll up. But if you are too familiar with the status quo, the experts in the field do not necessarily see the future. Yeah. And especially as you, like I genuinely, I mean, believe that large models can extend to many domains that were not software before. Like I was not particularly interested in vertical SaaS or the legal industry before Harvey.

But I think Harvey is a really interesting company. I still don't know anything about the legal industry. I know like 1% of what like I should as an investor here. But the point is the TAM has massively expanded because we are not just doing some incremental little productivity thing. We're trying to take huge amounts of the profession and democratize it and raise the bar of expectation for what you get from your lawyers.

And so if that opportunity is large enough, and I think the hammer is a really good hammer, I am so excited to learn about the legal industry and work on it for 10 years. We just got a legal bill a day or two ago, and John was like, oh, maybe we should have chat GBT'd some of that stuff. And I was like, I think we're in the last maybe few months

before we're going to have good enough legal AI. I think we're going in the last like maybe like few months before we're gonna have good enough, you know Legal AI, I think we're going back to handshakes and smoky back rooms and threats of violence Can't handle these legal bills anymore. But but yeah going back to your question You said that I think is an interesting thing to pull out You said like experts can't see the future but they absolutely can see today it's like sometimes you like, you know look and you hear a pitch and you're excited about it. And then you talk to a friend who like actually knows the industry really well. And they just point out like, here's like the one reason like why this is not going to work today. And so it's like, is it just you have to like step back and like almost kind of view things at a macro level and then

ultimately make a founder bet? Um, I mean, like, why do we end up working in areas where we don't have deep domain expertise? It tends to start with, we love the founders. And there's some first principles view of it makes sense why we should be able to restructure the industry or the technology is going to be massively important. The thesis just makes sense. And so at least my personal approach is I'm going to try to understand

what every expert in the status quo believes. And usually, if it's a good thesis, somebody thinks it's viable. You'll just get mixed opinions back. But I don't want to discover that there were obvious reasons it was not going to work. I would like to understand why everybody else believes it is not going to work and then like, you know.

Still believe. Yeah, it seems like there's a lot of, I mean obviously there's a lot of money sloshing around in the AI deal making space right now, but at the same time, it's easier than ever to test an idea and see, oh well, we got to 100 million ARR in three months. Like maybe there's something here.

Can you talk about just like the pace of play in AI, both on the deal making side and then on the actual revenue making side? Because it feels very different than the dot com boom where companies were going public with like $2 million in ARR and they're trading at a billion dollar valuation. Some of these companies, they're at high valuations, but they have a lot of money coming in.

Yeah, I mean, if any of you guys are experimenting your way to 100 million on run rate, please call me. Yeah. I still think it's pretty hard, but maybe to your point, people are doing it very efficiently. And I think it just speaks to the technology, the magic box is very powerful. And you don't necessarily need,

it's not like if you just think about the SaaS world, right, like I need an army of engineers to implement the business logic of like, how does payroll work in Slovenia? Like I'm turning the law into code. Right? And I think that the experiment, like the iterative nature of like,

I'm trying to make a model produce outputs that are great in these specific workflows, but the workflow is so valuable, enables some of these companies to grow in an unhinged way. Like the ROI is there. I think healthcare is a really interesting example of this because for like a 10 year period I was like, oh man, I would be really careful about,

with love to my friends who are healthcare venture capitalists. Massacres. It's not a super fast moving area. Huge part of the economy, very important, but it's just like, it's not like an early adopter industry. And yet you have companies that, like Abridge and others that like have massive revenue pacing, including the enterprise. And I think the basic answer is like, now people are making things that are worth buying quickly. So that the fundamental piece is like pretty exciting here.

I think the pacing for entrepreneurs and for investors is either also very exciting or very stressful, depending on your personality. On the group? Do you think some of the sort of bad activity in the space, is there so much pressure now on, the bar in AI has now been set that like, if you're general access products and you're not like two Xing every single month,

they're like, you know, not every single month, but like, you know, growing like extremely quickly. Everybody's seen the charts of like, you know, whiz and cursor and ramps and deal and all these companies. It just feels like the pressure is now so intense that people are like counting C AA-R-R as like, you know, or sort of like trials and demos. Do you find yourself giving advice to founders

of being like, you know, ignore these sort of like, ignore the charts and just like focus on your customers because if you're too focused on like, how do we just grow like best in class and you maybe end up like not building, you know, building stuff that's not reliable or you know, robust. Yeah, I, I think people focus more on what's out there instead of what's possible for their business way too much.

Right? Like I think it's a pretty. So there is something fundamental in what you said, which is like the world has become faster and the internet gave us the ability to distribute software products much faster than previously. Like you were not gonna go to like a hundred million of runway in a couple of months before you could discover

things on the internet, right? Like what are you gonna do? Like call somebody on the phone and be like. Come here with the CD-ROM. The CD-ROM. That's how South Bank got started. I mean, or it was just like structurally a bit slower. Yeah.

So I think the ambition for the number of connected people in the world, the number you can serve, how quickly things can grow, should structurally increase for entrepreneurs. And an investor from the outside being like, best in class is this company, which has nothing to do with your company, is not very useful. If there is a data point in your customer segment of how quickly something can grow and you are not winning, that is relevant data, right? Then the bar has actually risen and you should figure out how to

win. But I think there's also an important question. We talk about, there's another investor who calls it chicken nugget revenue, but we just talked about revenue durability, right? There's a big difference between deep usage, multi-year contract, enterprise revenue with integrations and people trying something with 30% a month churn. Is that what chicken nugget revenue is, is trial revenue basically? I don't know if people like, yeah, you trial revenue or just like revenue that you know is perhaps commoditized. Yeah. Right?

Low switching costs. It's the novelty of people trying new things because like AI can do so many cool new things. Yep, that makes sense. Not really changing their day to day. Like it's not like a 3d7 behavior where I'm somehow working better, like playing more, being happier. And so I think people should figure out what the bottleneck to growth is in their business

for durable revenue, and then anything else they should treat as distribution. And I don't know what to tell investors about that. Buyer beware. Buyer beware. Last couple of questions. What introduction have you made that's generated the most enterprise value?

Andrew Reed was on the show and said that, like I think he said that you connected him to Pat and that's, you know, been pretty good intro. Is there anything else that comes to mind that you're particularly proud of? I don't know, I make a lot of introductions. Yeah. I think Rita's a very good investor.

No, I think the, I think probably created the most enterprise value. I think there are companies that I've been a part of, be it Figma or Harvey, where I'm giving an investor friend a hard nudge and being like, I really think this is gonna work. This guy or gal's like good, you should work with them. And that included like Andrew Reed had the thesis at

Figma, but I was also like, you should do this, right? Like to Dylan and Andrew. And I think, I think everybody's thrilled about that. I introduced a, I introduced my husband Pat to Harvey. I think that is making progress. I introduced a very close friend, Sinking Zeb to Harvey at GV. And so I think I'm like excited about this company, right? Well, I'm excited. I'm excited like, you know, 20 years from now

for the email screenshots from you of like, you know, all the AI winners being like, yeah, I made that intro. I made that intro. Last question I had and then we'll let you go. I know we're at time. Did you ever intend on being a solo GP? You hired Mike, I think that got announced last year. I'm assuming you just had this 30 year master plan

to build a real firm or something like that, but how did you think about? When are you IPOing? I've heard Andreessen's going out. When can we expect to buy some shares? I don't think we have the ambitions for selling equity carrier scale. So I think I would be much more interested in how high

the hit rate can be. That's great. And how high the multiple can be and how close we are by our entrepreneurs. So master plan. No, kind of the opposite, right? I had a very strong instinct that I wanted to do early stage investing in a concentrated way and I believe in partnership. And then also like I was in a big hurry to like get going. We launched in October of 2022 if you'd seen research previews or played

with AI or thought about it for a number of... It was accelerating. And so I thought that there was a window to go figure out what was going on and try to be in great companies. And so I just figured it would be better to start figuring it out and date very slowly. The idea that the perfect partners would be immediately available right when I was leaving Greylock seemed unrealistic. It took me a year to convince Mike that he wanted to work 110% and I'm super thrilled to be working with him It's awesome. Amazing. Thank you so much for coming on. Yeah, that's a conversation. We'll have to have you back soon

Do you guys have a great day? See ya. Thanks a lot Coming in next we got Nick from light matter Gonna go deeper on Nick light matter himself in interconnect. It's a very interesting company There is a ton of money all focused on how we can improve these huge, gigascaled AI training runs. It's a fascinating company, very deep tech, basically. He's going to have to do a lot of explaining for us, because I'm not up to speed on his technology,

but I'm excited to talk to him. So Nick, are you here? Yeah, I'm here. Good to meet you guys. Good to meet you too. How are you doing today? Doing great. Yeah, we just had a big launch event yesterday

sharing our products and excited to chat and tell you guys what we do. Yeah, yeah, yeah. Why don't you just start with a breakdown of yourself, your company and what you announced yesterday. Yeah, I'm Nick. I'm co-founder, CEO of Lightmatter. Been building a company for about eight years now.

We're based in California in Mountain View, and we're about eight years old, spin out of MIT, and we're looking at the future of computing. So our goal is to continue to make progress on the cost of computation, the scale of computation, and the energy efficiency in a time when computer chips are no longer making progress. Really principally the only way that chips get better

these days is by, if I want to double the performance, I double the number of computer chips inside a package. And so you're seeing over the past 10 years, these chips getting absolutely massive. And then the next challenge is around how do you link them together, especially in the context of training these large language models for AI and that sort of thing. And that's what we do is we build these optical links between GPUs to power foundation model training and that sort of thing.

So how does that interface with the rest of the products in the market? I mean, Nvidia is known for NVLink. I used to have two 3090 graphics cards that were kind of linked together of the PCI slots. Like I imagine it's much more complicated on your side. But can you give us a couple more concrete examples of like how this rolls out, what the timelines are for this type of thing, what kind of performance gains we can expect to see? Yeah. So right now, in terms of timelines, chips are coming out this year. We've got big semiconductor partners

that will be releasing products this year based on our technology Passage. And the way Passage works is it's a silicon photonics engine, so it leverages all the semiconductor manufacturing supply chain that's used to build all modern chips today. So it's built in these big semi-fabs. You hear about companies like TSMC, Global Foundries. That's where we build the stuff.

And what we do is we 3D stack GPUs and switches, these really like heavy data center AI products on top of our photonic wafer. And then you cut out the die size that you want, attach optical fibers, and now you can wire up these massive AI data centers. You're hearing about XAI with a hundred thousand GPUs. Elon and team deployed that thing in,

what was it, 30 days or something like that. Yeah, that's insane. Which is breakneck speed. We are the wires, the photonic links that connect up these massive data centers. Yeah. And the steps are enormous. So we just announced yesterday 114 trillion bits per second. State of the art is about 1.6 trillion bits per second.

So about 100X. Wow. So obviously there's a lot of trade-offs here. I imagine that you're... Yes, thank you. The gong goes off when we hear a big number. I imagine that there are trade-offs probably at the early stage cost, but are we just talking about speed or is there also a heat component that's important to think about? I know heat dissipation is super important on these big

training runs. Yeah, I mean on the heat point, so something to notice like at a global scale, we're building data centers, humanity is building data centers that use as much power as the biggest cities on the planet. So five gigawatt data centers, New York City is 7.5 gigawatts, LA is 2.5 gigawatts. Yeah. So if you were to look at planet Earth through a thermal imager, the brightest objects you would see would be the mega cities, the deserts under sunlight, volcanoes, and these new data centers.

Fascinating. That's the scale of what's being built. And the real task at this point is how do you wire them up? How do you continue to drive performance and build bigger monolithic computers to train these AI models? Got it. How did you process the sort of deep-seek moment?

It feels like a decade ago at this point but it you know, the narrative was that they had GPU constraints and so they found more ways to be efficient do you think the American you know sort of like tech world that just hasn't cared enough about efficiency to date because it's all been about speed and We sort of haven't had that much capital constraints just because of how much investment is sort of pouring into the category. But I'm sort of broadly curious how you and the team processed it. Yeah, on the DeepSeek side, you know, what people are thinking is that you don't need as big of AI clusters to build a frontier quality model. And they had some innovations in how they train the model. And some people suspect that a lot of that came from

Using existing LLMs to build the new model Yeah, and that's not novel think about how we design computer chips like the CPU today was designed using the previous CPU And you're stacking up this ladder. That's how exponentials work. Yeah, so to me, it's like yes, obviously that would that would happen Yeah, I don't think it's really slowed things down Obviously that would, that would happen. Yeah. I don't think it's really slowed things down. Uh, and I think that reasoning models are going to require an enormous amount of computation and they require lots of links, like the kinds of photonic links that we build so that you can take these

models. If you ever tried deep research, it's like 12 minutes to get a, a result back. What if you could get it back in one minute? And what if the energy cost on communications was one fifth? Yeah, that's what we've been able. Can you talk about a few of the other paradigms for fighting with Moore's law and improving the speed of these models and inference? I've, you know, there's etched, which is baking the transformer architecture down into silicon. There's you know, if you look at the history of Bitcoin, they went from CPU to GPU to FPGA to ASIC. Are you excited about data interchange in a world where the latest and greatest Dolly 3 or 4 model is baked down into silicon into an ASIC?

Is that still valuable? Well, the past 30 years have been a million X improvement in operations per second for GPUs and for ASICs. A million X in 30 years. Interconnect is only approved by about 1,000 X. Today, Interconnect is the bottleneck. And the next 1,000 X in performance for AI training and AI inference will come from Interconnect. And that's fundamentally what we innovate on.

So that's the thing that we're excited about. I think if you look at ASICs, it's a spectrum. You start out with a GPU, which is relatively general purpose. And then you go to an ASIC that's like, okay, I'm gonna target AI training or AI inference. When you talk about edge, that's saying like, let's go even further, all the way to the bottom.

I'm gonna bake one model into this thing. And of course you should be able to get efficiency gains that way. But these are architectural tricks. You could have built that computer 30 years ago if you wanted to. So it's a one-off sort of hit. What you really need are new scaling laws.

And at Lightmatter, we're focused on the fundamentals. How do you make compute faster and more efficient? Are there new ways to do compute? How do you make the interconnect faster and more efficient? We need new scaling laws. Got it. I don't know if you've been following George Hatz's journey with AMD, but some of the foundation model labs

and the folks who are working on these big AI models have been kind of banging the table saying like, the cost per flop should be better with these other chip manufacturers, and yet I'm locked into Nvidia's ecosystem effectively because of bugs and just go fix the bugs. Do you have any pushback that you have to overcome when you're pitching somebody who's building a big cluster

to say, hey, slotting us in is not going to create any extra overhead on your software engineering team. Yeah, that's, you know, that's one of the exciting things. We're not building processors, we're building the interconnects that link them together. It requires no change to any software and thank God for that. That's amazing. There's no lift.

Yeah. And the TAM for this thing is absolutely massive. 300 billion a year spend on AI hardware, about% 25 to 30 is networking and that's where we play so it's an enormous market that requires no software change you can run CUDA whatever you want it's all fine. So what are the major hurdles or like next milestones for you in terms of scaling up? Do we need new machines? Do we need new machines that make the machines? Is it just are you are you demand constrained, supply constrained? How are you thinking about the next roadblocks in the business?

So I would say that the ramps are happening now in terms of volumes. So this technology, silicon photonics, attached to GPUs, attached to switches, it's happening now. You're going to see a rollout in 26, 27. Some of these big data centers are going to be using it. And the trick will be, can we make sure that the supply chain can handle it if everybody comes online at the same time? Right now, I don't think that that's possible.

But I think you could handle at least half of the world demand. There's about 14 million GPUs or XPUs that are shipping per year. I think you could get at least half of that. And it's not too hard to imagine building out the capacity to get the rest of the way. But the tech's been ready for prime time, you know, for a couple of years now with us. And it's been an eight year journey. So it's not exactly overnight. We've been working on, you know, all the problems on every front for quite a while.

We're still going to call you an overnight success when you finally public and finally, you know, deliver some massive quarter. We're gonna say, oh yeah, it just happened all of a sudden. We love overnight successes. How skeptical are you when you see new seed stage, anything on the hardware side of AI? People love to come out and sort of make these big promises and then some companies actually can manage to get public just purely on big promises.

Do you think we need more founders coming in and starting to build at the hardware level or is it just so hard that, you know, focus on the rappers and, you know. Do we need to start an activist short hedge fund? Because it seems like he knows the science here and can probably make some good calls, but I'm sure he's too nice to do any of that.

Yeah. So I would say that the picture Leon, so we started in 2017, that was the AI accelerator boom. You think about Graphcore, Samba Nova, like all of these companies, Cerebros, all coming out. Largely, that's been a really tough slog. Like it hasn't really worked out. I wish those guys the best.

Yeah. You know, to be frank here, I wish them the best. But of course, it's hard. The software mode around Nvidia, the adoption, the models are designed to fit on Nvidia GPUs. Yeah. Like that, that is the mode. Like everything is architected for Nvidia. And so good luck bringing in something else. So the new pitch, the new like pitch for these guys is everyone did this wrong. I know what they did wrong. If you just do this, it's going to be fine. But my fundamental issue with it is you're all using TSMC in the exact same node with the same packaging technology. You can't tell me you're going to have some breakthrough.

It's the exact same tech. That's fascinating. Well, good time to be in the compliments to Nvidia, not in the not in the substitutes. Love this. I like your strategy. This was a fantastic conversation. I honestly, I didn't know about the business last week, but I'm super excited we got to talk to you and we'd love to have you back. This was fantastic. Thank you so much. Awesome. Yeah. Happy to be on and thank you guys. Yeah. Appreciate it. And congratulations and we'll talk to you soon. Cheers. Yeah. Switching gears. And congratulations, and we'll talk to you soon. Cheers. See ya. Switching gears, we're going over to-

Eight year overnight success. An eight year overnight success, an absolute dog. We gotta hit the Saizgong again for all the big numbers we heard from that. Didn't understand most of them, but liked his attitude. Saizgong. I love the Saizgong.

Well, we got Roam Mortgage coming in in the temple of technology in just a few minutes. Fascinating business heard about this and the pitch made so much sense. You're locked in to a 2% a 3% mortgage fixed. You want to move you feel chained to that specific house forever. That shouldn't be the way it is. So you can move and and and kind of keep your rate or sell your mortgage. But I want to hear from the founder, so let's bring him in. How you doing?

Hey, John and Jordy. Great to meet you guys. Great to meet you. By the way, if you're wondering, I say my name like Ronick. It's like ironic without the I. Ronick. Okay, great. Beautiful.

Thanks so much. Would you mind, I tried to give the pitch, I probably botched it. Would you mind giving me the pitch for Rome just from the horse's mouth? Yeah, it's basically you can buy a home with a 2% rate. You know, the basic problem we're solving is that today, there is millions of sellers who are locked up at home because they have this two or 3% rate. They don't feel like there is a value or ability to be able to move. And 75 million families in the US cannot afford

a purchase because the how high rates are. So we help buyers wind back the clock and purchase the home with the seller's mortgage included. That's amazing. Is this a regulatory innovation or a technological innovation? Why didn't this exist a decade ago? Or is it just a function of we didn't need it

when rates were low? Yeah, so actually, these were very popular in 1980 81 when mortgage rates went from 2% to 15 to 17%. And at that time, all mortgages were assumeable, actually, and for other reasons, because the savings and loan crisis, we ended up regulating it such that all the other homes had to have their loan paid off when the home was sold. So we could avoid

everyone just purchasing the home with seller's mortgage. But what remained were these FHA and VA loans. So the government backed loans. And there were 1.5 trillion of them, basically, if you think back to low rate years of 2020 and 2021, when everybody was getting a 2% or 3% mortgage, that remained a symbol. But the problem was nobody knew how to find them because no seller knows what type of loan they have. And if they know what type of loan they have, they don't think there's a marketing advantage to it. And even if, by the grace of God,

you could find one of these loans, it was impossible to transact on them because the banks made less money on it. So we thought we could build a platform that basically vertically integrated all the problems within that purchase process and give it to consumers as a simple tagline, buy a home with a 2% rate, come to Rome,

and you can find all of the homes that are relevant. Yeah. Yeah, so break down, I guess, what the obvious thing is just like for Rome to know, widely just incredible. Right. You just need scale. Right. You need options. Right. When people go and they're looking at a specific, some people want to go down and, you know, I have friends that want

to move to where I live. And like they're trying to buy one of like 160 homes and like 90% of them aren't on the market. Maybe some are for rent and some are for sale. So how do you think about just getting, it feels like it's a supply problem in terms of just getting the supply on and then once you have the supply,

then the demand is just obviously there. Yeah, so we actually did something pretty scrappy. I think had we waited for every seller to come on board, it's like any other marketplace issue. If you wait for all of the supply to come on board and opt in, then try to aggregate all the demand, it's like any other marketplace issue. If you wait for all of the supply to come on board and opt in, then try to aggregate all the demand is going to take like five years. You know, by that point, consumers have lost interest.

So we did is we actually in a pretty novel way found every home in America and then every mortgage record in America and cross pollinated it. So we just loaded up all the supply on the site. We didn't wait. I love it. Yeah, I'm on board. So you saw the supply side because you can uniquely show all of those homes and then you just hammer demand and

you're basically like, hey, do you feel priced out? There's nothing wrong with that. All of us feel like we can't afford a purchase on today. And there's a better way you can actually afford to do it. And it's credible and legitimate and

trustworthy. And in cases where, you know, for instance, like the banks want to drag their feet on closing some of these transactions. So, you know, for instance, like the banks wanted to drag their fee on closing some of these transactions. So, you know, we're like, let's just pay for it. Like, let's say that if it takes longer than 45 days to close, we'll pay for the seller's mortgage until it closes. So it's kind of a combination of using technology to find all of the homes that are relevant, taking advantage of some of the partnership stuff and getting some of the

mortgage lenders to come on board and see that there's value in this. And then also just like really pushing on the experience, you know, like I tell the team every day, like if somebody doesn't want to close one of these, I will personally call and we will make sure that this gets cold closed, you know, it's like, we'll just ask. Do people ever realize that, that they have an, it's like an assumable mortgage and then try to sell their house for more? Cause they're like, look, you're carrying carrying costs is going to be a lot lower.

You should be able to bond market. Pay more. Right. I know John has a very low, low mortgage rate. And I was like, he was like, you know, if he ever moves, he could be like, well, pay me more. Yeah, pay me more because you're carrying costs.

Yeah. Yeah. Where does the value actually transfer our crew? So basically, an independent group of economists recently studied Rome. And it's always fun when you start a company, you're like, OK, we have these set of ideas on what the seller's going to get,

what the buyer's going to get, and what's going to happen. But independently, a group of people who'd never even spoken to me studied Rome. And what they found was sellers get 5% more for their home sale when they sell their home with their low rate mortgage included, buyers $700 a month. And that if this option was widespread, it would remediate basically the lock and effect you see today. That's awesome.

And one of the reasons I got really excited about starting Roam was that I was at Opendoor before this, which is how I had a chance to work with Eric and Keith. And I just polled 50,000 homeowners and asked them, what's the interest rate on your mortgage and what's your preference share for selling to Opendoor and like 90% of people who had a 7% mortgage were willing to do it. But if you had a 2% mortgage, you would only do it like 5% of the time. Wow. So I'm intuitive. There was like a large chasm, both emotional and functional that they wouldn't be willing to cross, but somebody could give that optionality to them. That's cool. Can you take us through the news today? What are you announcing how to come together? Give us the story. Yeah. So today we announced that Keith and COSLA led an $11.5 million

round into Rome with Founders Fund. We actually had two investors. The whole process happened in like a week, so it was really fast, but we're thrilled to continue working with Founders Fund and COSLA. You know, Founders Fund led the pre-seed and the seed round, and it's been great to have a chance to work with Keith in all three investments that we've done. So pre-seed, seed, and series A, Keith led all three rounds,

and then he joined the board alongside Eric, who is the founder of Open Door and series A. And in terms of the use of those funds, I imagine it's almost entirely R&D. You're not putting up any capital for these mortgages or buying things. There's no, it's a very asset light business, right? Exactly. So we're not taking any capital risk. You know, I still hold all my open door shares, RIP and, you know, saw some of the dynamics there, but basically we help people without

putting voluntary risk on. We're like connecting all of the layers through the stack. So yeah, no voluntary risk in the business. That's great. Oh, sorry, go. Do you just get frustrated that there's millions of people that are looking at Zillow all day long, and you're just like, I feel like the big problem in terms of scaling Rome is just making people aware of it. Now, do you walk down the street and yell at people and just say, by the way, in terms of scaling Rome is just like making people aware of it now. Like do you walk down the street and yell at people

and just say like, by the way, have you heard about Rome? Like you can get a 3% mortgage. Like if I were you, I'd just be screaming it like on the street like a crazy person because it would probably be pretty effective marketing. But I'm curious, like what do the next two years look like? This almost feels like, you know, with the Series A, it would be not super practical to spend it entirely on a Super Bowl ad,

but this almost feels like the kind of business that you could be doing this just sort of like mass, you know, at scale marketing and find results with that. Yeah, exactly. I mean, I like walking to a bar and the first thing I ask people is like, do you wanna own a home? And then do you feel like you can afford a home?

And like nine of 10 people want to be able to own a home, but like one of 10 people feel like they can. So that's immediately like the opportunity to tell everyone about is like we can close that gap. And then we think about getting distribution in three ways basically. So we tell sellers and listing agents who like actually have that inventory with an assumeable loan that instead of advertising like everyone else, that you got a cozy two bed bed to bath garage indicator, Georgia.

You need to leave with the fact that your home is differentiated compared to everyone else because it comes with a 2% rate. That's why somebody's going to buy it, you know, because it's not a rate that they can afford and for buyers. It's as you mentioned more mass market just getting the word out there through media as well as through some now. We're trying a few paid channels, but telling people that they can actually afford a home with a 2% rate. And then we're actually getting like some other partners, you know, like mortgage servicers and agents to distribute the product for us to their clients, because they see there's value in it now too. So it's a lot of the distribution, you know, we had found signs of early on, but now we're diversifying that and bring out really what's gonna be super repeatable

as we look to get massive scale. Sorry, I'm not distracted. I'm just shopping on Roam right now. There's some absolutely banger mortgages available here. I'm seeing some potential future. Yeah, yeah, yeah. I'm like, wait a minute, this is amazing. Honestly, I think people, what you need to tap into

is people's addictive behavior around Zillow. Oh yeah, totally. And you just need to convert that to, cause the dopamine of seeing like, I see a house that's, it's like half- Seeing a number that's like, oh two grand a month or three grand a month, but it's like, oh, that's like completely,

like the sticker shock goes away. So I'm seeing a house that is almost three times as expensive as my house within a half mile, but the mortgage is only like 60% more. And it's like, that is like the dopamine rush for a user to be that sort of like, basically take the magic of like look home shopping, and then you just make everything like, you know,

whatever, whatever the average is 30% cheaper from a carrying cost standpoint, because that's what ultimately drives affordability for most people. That's why we have this right through visualization, everything on Rome, because, you know, we didn't even need to make a map. If Zillow would have done this, if you go to Zillow and you search for like, I don't know, like a city like Houston and you go on keyword search, because that's how you'd have to find it. And you just look for sellers, your advertising, a sumbo loan, you'll find like literally two results. And then if you come to Rome and search in Houston, you'll find 2000 results. And it's because sellers don't know they have it. And Zillow is basically just feeding what the MLS gives them, which is like, you know,

an uninformed perspective into it. And you know, we raised the capital too. We had some investors ask like, oh, what happens if Zillow does it? I'd be like, great, you know, an uninformed perspective into it. And, you know, we raised the capital, too. We had some investors ask like, oh, what happens if Zillow does it? I'd be like, great. You know, like now everyone knows. Put a button on there that says buy this home with your own and cut your monthly payment in half. So it becomes like a firm for home buying. Where it's like a button on every listing card in the US to help you cut your monthly payments in half.

Yeah, that's very cool. I mean, speaking of customer acquisition, like what is working and what do you think the next year of customer acquisition will look like? Yeah, so right now what's really worked super well, pre-seed, seed, series A, like when we did the pre-seed and we're like, OK, like, is this a real problem? Like, let's announce it. It was like the front page of the Wall Street Journal,

which like blew me away. And that's not because of me or anything that I've done. Like, nobody even knows who I am. It's mostly about like the fact that it resonates with so many people that they feel like they can't afford to buy a home. And so we saw that continue for like the last 18 months, basically that there's just, you know,

quarter million buyers that come to the site and we didn't pay for any of them. And they're just like looking to be able to buy a home. Now it's like, okay, how do you really deepen that penetration and get to work within each of the local markets? And so now we're finding ways to work with agents,

which like for listing agents, hey, let's help you win more sellers because you can actually show them why you can get them to move kind of relating to that study at data at Opendoor. And for buyers agents, it's like, hey, you got like 10,000 contacts in your CRM that basically said, no, I'm not interested

because insurance is high, taxes are high, prices are high, rates are high. Go and reengage all of them. Be like, hey, if I got you in a home with a 2% rate, you might find that you don't get qualified for 325K, but now you get qualified for 475K. So maybe that makes you interested in buying a home now. So-

Have you seen investors using Roam to buy homes with the intention of just leasing them out? Because like I imagine, you know, I'm just like scanning the marketplace around LA, there's rental units that I'm, you know, or I'm seeing like three bedrooms that are whatever for like four grand. I'm like, I know where that is. It's probably like a seven, eight K a month rental. And if you're an investor looking at this, I don't do anything in real estate. I prefer highly liquid private shares in my friends' companies. But there are a lot of opportunity, I imagine, just like in kind

of like, you know, potentially alpha on Roam. Yeah, totally. So we actually launched a page just for that. I think if you go to the homepage, there's a tab called investors. So it shows you all of the homes that have an underlying BA loan. Those don't require primary residency. And so any investor can purchase that you can put in the cash and you can take over that loan and go on to lease it out. So facilitate those all the time. And most people don't even know that's possible. You know, there's so much misinformation about this stuff. Because if you think about it, nobody's really incentivized for it to succeed. Most people are incentivized to originate new mortgages at 7%, not recycle the cash to purchase your friend's mortgage at 2%.

Yeah, that makes a lot of sense. That makes a ton of sense. It's very exciting. Well, now we know you, we know how to pronounce your name. And yeah, we really appreciate you stopping by. This was fantastic. And congratulations on the Series A. Congratulations on success. Stacked lineup too on the right side is going for you so enjoy it i appreciate that guys and then if there's anyone listening who is interested i think of it as like the manhattan

project for housing affordability and we're actively hiring this is going to be the most important and i think only solution to affordability in the next five years fantastic the politicians talk about like oh we'll increase permits or something like that. That's just not going to take impact to like 2035. Sure. You want to contribute to making it more affordable today? Email me. I respond to every single email. I'm ronick at with rome.com r a q with rome.com.

So well, thanks for coming on. Fantastic domain to hit this. Yeah. Yeah. Oh, it's with with Rome. Sorry. Hopefully you're getting rome.com soon. Soon. Soon. That's with with Rome. Sorry. Hopefully you're getting Rome comm soon soon soon. That's serious be money

Yeah, we will have you back as soon as the series B drops and anytime there's housing news We'd love to chat with you about it, but have a great rest of your day. Thanks so much for stopping by great to me We'll talk to you. See ya. Bye Well, you know if you're looking for a new house and you're roaming around you're trying to see if you want to live in A community go on wander find your happy place test it out rent a luxury home and then get on Rome and buy a house next door book a wander so firing you use hotel grade so dreamy beds top tier cleaning in 24 7 what do we say about wander we say fine you're happy place find your happy place and we also

we're getting better every day that yeah we are we're getting good well let's go through some news and some timeline. This is an exciting story. So the co-founder of Robinhood has started a company called Aetherflux, Aetherflux, and Chad Byers was posting about it. Baiju co-founded Robinhood and helped scale it to a $40 billion company as of today.

He's back with a new company to help deliver energy from space. Excited to be a small angel to work on space lasers. So they're putting solar panels in space as I understand it. I got like a pizza with him like a long time ago. I think he'll be able to come on the show in a few days.

And I think they're putting solar panels in space and then beaming the energy down with lasers to a receptacle that takes the energy and it's all very sci-fi and futuristic, but I'm excited to hear how he built out that model because that feels like something that lives and dies by the Excel spreadsheet of like, what are launch costs? What do the cost of the solar panels cost?

And if you play it out, there's a bunch of controversial things about like, are we gonna black out the sun? Like, will we be able to see the sky? There's space trash, space junk questions. There's also a ton of hard tech engineering stuff. We've talked to Deli and a bunch about how hard it is to actually manufacture something,

get it into orbit quickly. And so lots of challenges, but I love that he made a bunch of money in finance and then is taking it into hard tech. This is what we saw with Elon. This is what we saw with a lot of folks who had a first business. This is what everybody says.

They say, I'm gonna get the bag and then I'm gonna change the world He's doing a few actually and he's doing it. So so they're so yeah happy to support and I'm sure we're gonna see a lot More from his company in the new. I wanted to cover the circle IPO filing. They've filed their s1 yesterday We have a post from Omar who I believes over a dragonfly He says nothing to love in the circle IPO filing and no idea how it prices at five billion. Gross margins getting crushed with distribution costs. For those that don't know, Circle pays Coinbase as an example,

a lot to effectively distribute the stable coin. Omar says core US market being deregulated and banks and financial institutions about to crash the private party spending over 250 year in compensation, another 140 million in GNA. Core income driver, which is rates already topped and heading lower, 90%

chance of two cuts this year. Um, and it were, they're pricing it at 32 times 24 earnings for a business that just lost its mini monopoly and facing several headwinds. And it's expensive when growth is structurally challenged. TLDR feels like a Hail Mary for some liquidity before the squad rolls in. So.

Who is the squad in this case? Oh, it's just all the banks and other financial institutions that will launch their own equally stable coin. Sure, sure. Yeah, that makes sense. I heard a take from a crypto investor I was texting with. She said, you know, there's no real crazy take here, but it's the first stable coin IPO, which is just a cool way for public markets

to have a clearer way to be long stable coins generally. And so that's a product that really hasn't existed. Prior, you had to go into private markets and invest in something like Bridge, which Sequoia did, or you had to go on chain and do all this more manual stuff and get some leverage and do all these crazy DeFi things. And now you'll just be able to buy it on public.com. So if you are invested in Circle and waiting for the IPO

and you're stressed out, what kind of bed should you sleep on? An eight sleep for sure, no doubt. Go to eightsleep.com slash TVPN. How'd you do last night? I think I did poorly because I woke up so early because of the rippling deal spy news. We had to get up early to talk about that story. Dig in, let me see how I did.

I imagine I'm a little low on total time. I was right, I got total time. I was right. I got a 79. I was asleep for six hours and 31 minutes. What'd you do? We were, we were scooping. Yeah. In our defense.

What'd you do? I did a 97. 97, that's great. But that pales in comparison to a friend of mine and listener of the show, Bailey. Bailey Barrow put up a hundred last night. He texted me this morning. Congratulations to Bailey. Congratulations to Bailey.

Congratulations to Bailey. Give him a little gong for that. Little gong moment. But go to eatsleep.com slash TBPN and get yourself a pod. You will not regret it and your body will thank you. Who else should we talk about? Oh, big news from Patrick O'Shaughnessy. He's launching issue number two of Colossus Review.

We did a whole deep dive on the first edition of Colossus Review. It was a fantastic interview and really a lot of content in that magazine. Not light on content at all. Great layout. It will be free for everyone online. The print is magic.

You gotta get the print edition. That's a good strategy, by the way. And I feel like one of my friends had, um, his parents had a subscription to natural, national geographic since like the eighties or something. And so he has a collection of every single magazine of national geographic. And so when you go over to his house, he'll kind of say, Oh, like what month and year were you born in? You'll pull out the national geographic from that year. he'll kind of say, oh, like what month and year were you born in? You'll pull out the National Geographic from that year, and you can kind of see what's going on

in the world at that time. It's kind of a fun like party trick. And it's not every day that you get a chance to actually say, okay, I think this will be, I think Colossus Review will be around for a long time. If I order the first one and then stay subscribed forever, I could wind up with a library full of these things and actually have a complete collection.

And I'm not saying that that's gonna be like wildly valuable It'll just be a cool artifact to put in your library one day and a way to understand Yes tree from the lens of Patrick himself. I'm just excited this because about this Because the Thomas yeah because the topic renoaks is is one of those firms that is Intentionally goaded under the you know, there are many ways under the radar. You don't see them on the timeline a lot, but then every time there's a $10 billion plus exit, it's like they're way in there.

Snuck in. Very excited. Yeah, so they're covering Neil Metta and Green Oaks. It's written by Jeremy Stern, and you really won't want to miss it, so check back tomorrow to get a copy of Colossus Review. Can't wait. I mean, I think Colossus Review,

I'm super bullish, super long. I wish, you know, Patrick obviously posts about it and he talks about it on his show, but I think he should buy some billboards. And he should go to adquick.com and I think he should make, you know, focus on- Put Neil on the 101. Yes, 100%.

I'm sure he would love that. I'm sure, yeah, I'm I'm sure you'd love that. I'm sure, yeah. I'm sure Greenhacks would love that. I mean, AdQuick would allow Patrick to tackle out-of-home advertising in an easy and measurable way. Patrick and Colossus, they'd be able to say goodbye to the headaches of out-of-home advertising,

because only AdQuick combines technology, out-of-home expertise, and data to enable efficient, seamless ad buying across the globe. So it's kind of a no-brainer for Patrick. He'll have to text him and let him know. Should we go over to this fun story that people were generating AI-generated receipts, trying to fool the expense management software's.

Ramps on the case, they solved it within 24 hours. Within 24 hours, Eric Gleiman Post spec'd, designed, and widely shipped to production in under 24 hours by Will Yee and the applied AI team at Ramp. And he shares the Michael Jordan meme of, I took that personally. ChatTPT's new image generator is really

good at faking receipts. Well, you're going to have to try harder. Good luck. To sneak it by your Ramp expense policy, because Ramp's on the case. What's the scenario where somebody's generating a fake receipt, they didn't catch a picture of the receipt? No, no, no.

I think it would be your boss says, hey, yes, you can go and take people out, but you can't get a bunch of drinks. And so you go and you say, yeah, we went to this restaurant and we bought salads and we weren't buying liquor, basically. Something like that. That is wrong. You know, you could change that.

No power lunches. Cause you're not going to be able to change the name of the swipe on the credit card, but you could fake the items that you purchased. So you could say, yeah, I went to Best Buy Boss. I got a new office chair, but really you got an iPad and you like sold it or something like that. So like that type of fraud, I think is what, not to give you any it or something like that So like that type of fraud I think is what not to give you any ideas

But yeah that that's the type of fraud you want to avoid and that's the reason why Ramp like is whole built around like take a picture of your of your receipt So, you know actually what people are are are buying on the corporate cards. Yeah. Anyway, um Speaking of ramp go to ramp.com Speaking of ramp, go to ramp.com. Time is money, say both. A lot of people say, oh, Wander is where you find your happy place, but when it comes to corporate cards,

expense management, and bill pay, ramp is where I find my happy place. Every day of the week. He's used corporate cards, bill payments, accounting, and a whole lot more all in one place. What else would be good to go to before we wrap it up? We got. I liked to round it out.

Chris Backe's post on. Summary. Quote, he said, the plan, you're James Bond, but it's at a global payroll company, and you only get 5,000 euros a month. And when you get caught, you'll lock yourself in the bathrooms and delete your LinkedIn account and break your phone with an axe and immediately confess and join the... it's a great summer... join the you know the enemy.

It's such a bizarre story. It's really entertaining. It's the truth is stranger than fiction. You really can't write this. It is. The new season of Silicon Valley. Everyone says we can write it. What a wild day. But yeah. And yeah, thank you to all the sponsors. Show's been really fun. Go to public.com investing for those who take it seriously.

And check out Polymarket, AdQuick, 8 Sleep, Wander, Bezel, Numeral. All of our sponsors. We're really thankful to them. Do it all in time. We got to get our sponsors. We're really thankful to them. Do it all in total. We gotta get a new, we gotta get a new. So I was looking on Polymarket. There's a lot of stuff on who will acquire TikTok.

Apparently, AppLovin and Amazon emerge as TikTok bidders ahead of the deadline. So right now, Perplexity, Larry Ellison, Oracle, et cetera. I don't know if AppLovin, I don't think is even listed or people, yeah, we're not seeing it up there. So we're gonna get this update or we're gonna get this market updated because AppLovin is in the race.

And last I checked, I'm gonna look on public. AppLovin actually had the market cap to potentially absorb something like this and they have the ad on the other side. I mean, just the last thing we should cover today because it is news today, the tariff announcement did happen. Trump gave the speech at the Rose Garden for liberation day

and the result is that the US will impose 10% tariffs on all imports and even higher rates for some nations. The president opened his remarks Wednesday by saying new tariff policies would make America wealthy again. He said he would be announcing reciprocal tariffs on countries across the world. It can't get any simpler than that. You tariff us, we tariff you. Later, Trump held up a chart with a list of countries saying it was too windy to put on An easel which is kind of funny. There's a funny image going around He began to read off the list with tariffs of the countries imposed on the United States and then the tariff He said the US would levy in response

He said that the US was going to be charging a discounted reciprocal tariff because the US is kind for China The US is levying a 34 percent tariff then for europe We're gonna charge them 20 percent japan 24 percent is going down 31 percent tariff on switzerland meaning that the price if Your existing watches just went. Oh, yeah, and In general the market seems to like it the The Dow Jones is up half a percent, the S&P 500 is up.6, and the NASDAQ is up.8% today.

And so not a bloodbath in the markets. People were expecting some stuff, they got some stuff, they met their expectations and so things move forward, the march of capitalism marches on. We should have Joe on tomorrow. Sure. It'll be fun. I don't know if we have time.

Oh yeah. We'll stack line up tomorrow. Yeah, that'd be great. Joe Weisenthal would be great. One of the top posters in the world. But wait, we gotta give away, we gotta, so let's give away the Dom tomorrow. Sure.

I realize we didn't prep and pull all the Yeah, of course. Reviews and everything. But yes, little bit of an update. We are giving, instead of drinking a bottle of Dom Perignon, we are regifting a bottle of Dom Perignon. And so leave us a review on Apple Podcasts or Spotify, send us a screenshot of your review,

and you'll be entered to win this wonderful bottle of Dom Perignon. It is a 2015 vintage if you care. But we think it all tastes pretty good. Everybody cares. Thank you folks. Thanks for watching. Excited for tomorrow.

Have a great rest of your Wednesday. Bye.