TBPN - Live From Cisco AI Summit | Chuck Robbins, Aaron Levie, Jeetu Patel, Costa Kladianos, Dylan Patel

Episode Date: February 3, 2026

Sign up for TBPN’s daily newsletter at TBPN.com(00:51) - Timeline Reactions (49:06) - Aaron Levie, co-founder and CEO of Box, a leading enterprise cloud company, discusses the rapid advancements in AI and their transformative impact on enterprise software. He emphasizes the development of AI agents capable of handling complex tasks with unstructured data, highlighting the unprecedented pace of change in AI research and best practices. Levie also addresses the evolving role of AI in enterprise SaaS, suggesting a future where AI agents complement existing software systems, enhancing productivity without replacing core business processes. (01:09:35) - Chuck Robbins, Chairman and CEO of Cisco Systems, discussed the company's focus on AI at the Cisco AI Summit, covering topics from evolving models to necessary infrastructure, and highlighted the intersection of technology and geopolitics at the recent Davos meeting. He also shared insights into his background, including his transition from a mathematics degree to a career in technology, and emphasized the importance of balancing technical skills with emotional intelligence for leadership success. (01:28:10) - Jeetu Patel, Cisco's President and Chief Product Officer, discusses the company's strategic shift towards becoming a platform-centric organization, emphasizing the importance of ecosystem collaboration over a zero-sum mentality. He highlights the significance of the Splunk acquisition in enhancing data correlation for improved security measures and underscores the critical role of networking infrastructure in supporting AI advancements. Patel also addresses the evolving nature of software development, noting the increasing reliance on AI for code generation and the necessity for robust review processes to maintain quality. (01:54:42) - Costa Kladianos, Executive Vice President and Head of Technology for the San Francisco 49ers and Levi's Stadium, discusses his team's role in managing stadium operations, including ticketing, point-of-sale systems, Wi-Fi, network infrastructure, and cybersecurity, aiming to provide a seamless fan experience. He highlights the evolution of stadium technology to enhance in-person attendance by integrating social experiences and advanced data access, making live games more appealing than home viewing. Kladianos emphasizes the critical importance of robust network infrastructure and proactive cybersecurity measures to ensure uninterrupted operations and protect against diverse threats, given the stadium's high visibility and technological expectations. (02:03:02) - Dylan Patel is the founder of SemiAnalysis, the leading research and consulting firm for AI infrastructure and buildouts. Their publication is broadly respected, and they sell data to many hyperscalers and AI labs. In this episode, almost all of what we discussed has never been said publicly. TBPN.com is made possible by: Ramp - https://Ramp.comAppLovin - https://axon.aiCognition - https://cognition.aiConsole - https://console.comCrowdStrike - https://crowdstrike.comElevenLabs - https://elevenlabs.ioFigma - https://figma.comFin - https://fin.aiGemini - https://gemini.google.comGraphite - https://graphite.comGusto - https://gusto.com/tbpnLabelbox - https://labelbox.comLambda - https://lambda.aiLinear - https://linear.appMongoDB - https://mongodb.comNYSE - https://nyse.comPhantom - https://phantom.com/cashPlaid - https://plaid.comPublic - https://public.comRailway - https://railway.comRestream - https://restream.ioShopify - https://shopify.comTurbopuffer - https://turbopuffer.comVanta - https://vanta.comVibe - https://vibe.coSentry - https://sentry.ioCisco - https://www.ciscoaisummit.com/ai-virtual-summit.htmlOkta - https://www.okta.comKalshi - https://kalshi.comFollow TBPN: https://TBPN.comhttps://x.com/tbpnhttps://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231https://podcasts.apple.com/us/podcast/technology-brothers/id1772360235https://www.youtube.com/@TBPNLive

watching TVPN. Today is Tuesday, February 3rd, 2026, and we're live from the Cisco AI Summit. We're very happy to be here. Thank you, Cisco, for hosting us. We have a bunch of great guests lined up. We got Aaron Levy from Box coming back on the show. Chuck Robbins, the CEO of Cisco, an absolute dog. He's been with the company for decades. Truly, truly. Gigi Patel, the president and chief product officer will be joining us, Kosta from the San Francisco 49ers who's going to be breaking down the technology of the NFL. And

We're closing out with Dylan Patel, the founder and CEO of semi-analysis. That's right. Of course, if you're wondering, Linear is the system for modern software development. 70% of enterprise workspaces on linear are using agents. Really quickly, let me also tell you about our presenting sponsor, Ramp.com. Time is money, save both easy to use corporate cards, bill pay, accounting, and a whole lot more all in one place. Starting the show. Jordan.

Important announcement from Oracle. They said, are partners financing with Donia Anna Korni? County, New Mexico, Shackleford County, Texas, and Port Washington, Wisconsin Data Centers are secured at market standard rates, progressing through final syndication on schedule and consistent with investment-grade deals. So if this makes you worry, a lot of other people agree, this is the next, their most recent post after yesterday they announced the NVIDIA deal has zero impact on our financial relationship with OpenAI. We remain highly confident. In OpenAI, we remain highly confident in OpenAI's ability to raise funds and meet its commitments.

What did Roon say? Rune said, my confident in Open AIs abilities to raise fund T-shirt has a lot of people asking questions already answered by my T-shirts. Just 2,000 likes. This is a wild comp strategy. Interesting comm strategy. They've been hiding comments under this. That's rough.

I think they've stopped doing that because, anyways, people are saying, what an odd thing to say. It's a very, very awesome thing. It says, guys, just stop tweeting. Whoever you have running PR comms needs to be fired. You're making it worse. It is very weird to take this to act specifically. It's such a conversational platform.

Like, it's, it's, it's, hey, we want to start a conversation about concerns around our. Well, also just, I mean, it's a total rejection of the going direct thing. Like, this would be wildly different if it came from the CEO, co-CEOs or Larry Allison directly. Even, and it had like way more nuance. It's very odd when it has, like, the corporate press release. This screams that no one in comms actually uses X. Yeah. It's like, we needed to put this out and they didn't really consider that.

The channel. And maybe this probably went over fine in a press release or something. But just on X, it's a completely different context. And there's so much subtext with all the different partners actively being there. And even like low-level employees chiming in from companies that are implicated in this, there's like all this different. I like how you compare Oracle's strategy of like. the nameless, faceless announcement that just concerns everyone to Roon actually from Open A.I. commenting and just joking about it. And it actually gives you more confidence.

Yeah, yeah, yeah, totally. Like somebody looked at the Roon post and was like, it was like, O.F. Even Roon stopped shilling. We're aft. And Roon's like, no, it's just a funny tweet. Open A.I. is doing great. And that instills way more confidence. Gabe quoted the yesterday's post and just said, okay, yay. Okay, yay. Before we move on, CrowdStrike. Your business is AI. their business is securing it. Crowdstrike secures AI and stops breaches. And of course, Oracle's down 5% today. It's sort of a blunt-offedly, right? Honestly looking good compared to some other names. Yeah, what's on? PayPal down a full 20% today.

Switched out their CEO. Okay, okay. That makes sense. This, you know, had some Q4 results that people weren't super exciting about and people aren't excited about the forecasts either. a number of people have been speculating. Get the PayPal Mafia back in there. Well, yeah, I mean, you look at, Sheel had a, kind of was prodding Elon. He said, come on, Elon. You've always wanted PayPal to be X, the financial super app.

Now's a great opportunity. PayPal right now is valued at less than what X was in the Take Private. Wait, really? Yeah. No way. And X is obviously working on a bunch of different financial features. I thought PayPal all-time high was in the, like, hundreds of billions. Yeah.

So at the same at this, at the time. It's 40 billion now. Yeah. Add that in. Yeah, it was way up. It down, 85% in the last five years. I mean, truthfully, like a lot of people have moved on. They use, you know, cash app.

Yeah, but they own Venmo. Yeah, Venmo. Venmo is still very, like, millennial, right? Yeah. It's sort of like, and people use the Apple, Apple pay transfers, Apple cash. Like, there's been a number of, you know, shots across the bow for PayPal that they haven't responded to fully. I mean, they're net, you know, They own Venmo because they acquired Brain Tree.

It wasn't even like an in-house, like, really aggressive move. They sort of just lucked out with Venmo. PayPal, the $40 billion public company, had 2025 net revenue of $33 billion. Whoa. So not great. Major sell-off in pretty much all software today. We had another post here. Snap is close to all-time lows at $6.70.

despite growing revenues and profits. Serenity says, here's why the financial engineering looks criminal. Snapchat is an $11.5 billion company with a billion MAU and Q3 adjusted even of $132 million. However, stock comp for the last 12 months, $2.5 billion in the last 12 months. So really, really insane number. This is, I mean, always been the general criticism of Snap. But looks like they have not adjusted course yet. It's interesting seeing the gap between monetization,

between meta, a billion, Mao and Snap a billion Mao. It's like a 10x delta. Yeah, which is why, like, you were doing some napkin math on OpenAI. And I think that's like... They have a billion Mao. Do they monetize like meta or do they monetize like Snap? And on what timeline? Because they have Fiji-C Mo.

I think they could get to meta-level, you know, monetization and ARPoo. but it also could be lingering in the SNAP territory, which is, I think, $5 billion over the last year, trailing 12 months, $5.77 billion on a billion Mao. If you were monetizing it like meta, you'd be much closer to $50 billion, which is dramatic. Matt, Slotnick, commenting on the sell-off in software,

all of this because Azure grew 39% instead of 39.4%. Of course, there's a lot more. going on here. Bucco says knots. It's that the labs can hypothetically one-shot you, so why stand in front of that train? Why Express, quote, short AI in the marketplace. Yeah. Really quickly. Let me tell you about Shopify. Shopify is the commerce platform that grows with your business and lets you sell in seconds online, in store, on mobile, on social, on marketplaces, and now with AI agents. High yield, Harry says, wow, this software company is getting destroyed by AI today. It's Juventus, the soccer team.

down 13% getting. I guess people think that somebody's going to make cloud code for software or for soccer. Your inside man below says the robots are going to be playing and he has a photo of or a gif of

robots playing soccer. That seems bullish. We'll see. I don't know. Bitcoin also down dramatically. Where's Bitcoin? 75 or something. Joe Wisenthall has it up. Number three now. Absolutely. crash today, down 13% over the last five days, almost 20% of the last month. Lots of selling

activity going on. Bitcoin drops to lowest prices. Jim Kramer is now giving advice to Michael Saylor. He says, oh my, Bitcoin 73,000 beckons as the Dow hits a record high. Our chartist last night said this is it. The level that cannot be... Charterst? Our chartist. Chargist? Yes. The level that cannot be breached. It is time for strategy, also known as mass. Microsstrategy was the former name.

He says also known as Mr. for its Mr. Symbol to do a spot secondary or convert and stop this decline. Come on, Mike. Step up. He's just always rough when Jim Kramer is just like, stream of consciousness posting at you. So we'll see what Sailor does.

They have earnings on Thursday, and that will certainly be an interesting call. Yeah. More details on the PayPal shares plunging nearly 20% CEO exit. They replaced their CEO, Alex Chris, who was brought in to steer the payments firm through slowing growth and heightened competition and simultaneously issued a lackluster profit forecast for 26

on Tuesday sending its shares down 19%. The board's company's born, which named HPs Enrique Lores as its new president and CEO. So the pace of change in execution under Chris was not in line with its expectations. patience. Chris was tasked with turning around PayPal during a challenging period as post-pandemic trading volumes declined and competitive pressures in its core business intensified from large technology companies and newer fintech rivals. It does feel like, I mean, even, you know,

in the press release economy, it would be, it would have been so easy for PayPal to do some sort of deal with stock trading or prediction markets. Like every financial app and news product and grocery store. Everyone is like doing some sort of deal at least. even if it doesn't materialize, even if it doesn't move the needle, at least they're sort of putting their best foot forward. And PayPal, you know, you still mostly hear about it in the context of what are the PayPal co-founder's up to now? Oh, they're building rivals to the original company. PayPal said CFO, Jamie Miller would serve as interim CEO until Lores assumes the role on March 1st. That's a pretty quick transition. Lores was president and CEO of the consumer

electronics giant HP for more than six years. Wall Street analysts said the unexpected CEO announcement raises questions about the company's turnaround strategy. Of course, Disney's been going through a CEO transition, but it's been massively telegraphed with, you know, a contract that ended this year, okay, you know, a story last week about, hey, we're moving faster, hey, we're bringing somebody in who's internal, who's already knows the company inside and out. And it's been it's crazy that even with $33 billion of revenue, they're worth roughly like three and a half circles, right? Circle obviously, you know, just tiny, tiny company in comparison to PayPal. You would think that PayPal just they don't have an obvious like AI, like what's the obvious AI

bear case, right? Yeah. They move money. They're heavily regulated. You can imagine them. Figuring out ways to work better with agents and and capitalize on the stable coin boom. But we'll see what the new CEO ends up doing. The big question is whether he will bring in a formidable payments team to attempt yet another multi-year turnaround. Do they not have a formidable payments team? What happened? Who you got? Or they will love to start viewing options.

I would hope the payments company with half a billion active users has a formidable payments team. Apparently not according to Evercore. You lack formidability. PayPal expects full-year adjusted profit to range between low single-digit percentage decline and slight increase compared with Wall Street expectations of about 8% growth. Miller said the company was no longer committing to the specific 2027 outlook laid out at its investor day last year. We now provide forecasts one year at a time.

So getting more uncertain. No one likes that. The change comes against the backdrop of weakening retail spending as shoppers squeezed by elevated interest rates, stubbornly high living costs, and sign-up softening. May the labor market cut back in discretionary purchases and prioritize everyday necessities, stuff that's not probably purchased with PayPal. David in the YouTube chat says PayPal

did participate in the press release economy. They announced a deal with ChadGBT at the end of last year in Q4. In 2026, PayPal will become the first digital wallet embedded directly into ChatGPT, allowing users to make purchases instantly without leaving the platform. So anyways,

feels very oversold. And they also missed on the holiday quarter. So analysts were estimating that they'd make $8.8 billion, and they only made $8.68 billion. And so, you know, we saw a pretty strong holiday quarter. There was a lot of growth across e-commerce activity. We talked to Sean Frank at Ridge. Everyone was having – like, there were a lot of jitters about is the consumer healthy. But a lot of the growing platforms were able to outrun any softening in consumer confidence

by just onboarding more companies, onboarding. more customers. And so if you're declining, while everyone else is accelerating, that's going to be an issue. Ted says gold is dumping, silver is dumping, Bitcoin is dumping, Ethereum is dumping, DXY is dumping, stocks are dumping if everything is going down. Where's the actual, where's the money actually going? We talked about this last week. Sell everything. Sell your dollars. Sell your stocks. Sell your crypto. Sell your bonds. Freak out, actually. Panic sell everything. Nikita says data centers, raw materials, and land if intelligence is true. rapidly becoming free.

Expect a rapid rotation out of bytes and into bits. A lot of blue chip assets will soon be repriced. Of course, yeah, hardware is... Is he, uh, is that a typo? Does he mean rotation out of, out of bits and into atoms? Yes, he had a typos. Okay, okay, yeah. Because bytes and bits are kind of the same thing, right?

But yeah, a lot of blue chip assets will soon be repriced. So, I don't know, I'm excited to talk to Aaron Levy about this, about the SaaSpocalypse, what's happening with software. Deep Dish. says this is a pretty common misconception that money has to go somewhere. That's not how market caps are measured. They're measured by last price, time shares, contracts outstanding, not how much money you'd get for liquidating the whole pile. TLDR, the money was never there. Quickly, New York Stock Exchange. Want to change the world? Raise capital at the New York Stock Exchange.

We'll be at the New York Stock Exchange next month. We're very excited for... Cannot wait. Josh Diomero, is... the new CEO of Disney effective next month. This cycle moved very quickly. It did. Yeah. Lucas Shaw over at Bloomberg has the reporting. I'll pull it up. At the same time, I think it was managed pretty well. Disney's only down one percent today, I think. Iger will stay on the board and serve as a senior advisor until his retirement on December 31st. And Dana Walden was named to a new role as president and chief creative officer of Disney. Disney. Iger just got the opening Ideal done. He's like, I handled the AI transition perfectly.

And I'm out. They've only had nine CEOs in the 102-year history. The CEO job requires not only running a sprawling empire, but also serving as its high profile and highly scrutinized public ambassador. DeMorrow won a challenging bake-off for the job against Disney's entertainment co-chairman Dana Waldin. Let's give it up for bake-off. That has been the talk of Hollywood for more than a year. Walden was named to the newly created position of president and chief creative officer. Disney's leadership has been determined to run the succession process as smoothly as possible after its disastrous last try. The company named previous Parks boss Bob Chapeck as CEO in 2020, only to fire him and

bring back Iger two years later in a corporate coup. So there's a whole series of Bob's Bob Iger, Bob Chappecke over there. The CEO selection was overseen by Chairman James Gorman, who joined Disney's board in 2024 after managing a widely praised succession process at Morgan Stanley. Iger was chairman when the board picked Chepec. Disney shares were roughly flat Tuesday. Gorman in an interview said that he has seen Iger and tomorrow work together and is confident the handoff will go smoothly this time.

There's no tension here. shareholders will now look to Do Amaro to lay out and execute a growth plan for the company whose stock prices down by nearly half from its 2021 high when everyone was rapidly subscribing to Disney Plus and locked in just watching content. They went outside and the shares have slid since. It has been essentially staggering. Never go outside. Never touch grass. This is the New Disney campaign. Never touch grass.

Run it in the Super Bowl for sure. Gorman said the Wall Street Journal told the Wall Street Journal, that the board picked Diomaro because of his combination of strategic thinking and an understanding of the creative process as well as his experience working both overseas and in the United States. The 54-year-old spent most of his 28 years at Disney working in the theme parks, in the theme parks business in the U.S. and overseas, overseeing stints at California's Disneyland and Florida's Walt Disney World. In 2020, he has been chairman of Disney's experiences unit, which includes theme parks,

cruise ships and consumer products. All things that should grow in an AI world, even if there's a lot of like AI slop and there's pressure on the theaters. Should grow, but there's still so many, there's still so many questions, right? If you have widespread job loss, does that force a compression and pricing?

Yeah, but just overall purchasing power, right? Yeah, it's everyone, but again, you could see there's so much uncertainty. The idea that AI will just magically like AI getting good will magically make everybody spend more time off the internet is kind of a tough argument to make. Yeah, right? Some people react and there's, like, there's this like stated preference, which people are

saying, as AI proliferates, people are just going to log off. And I just don't actually see that happening. Yeah. I still think, I mean, I'm interested to see when the, the Open AI Disney deal really like rolls out. obviously you still can't generate Disney properties Disney IP in SORA or in or at least not in ChachyPT when I tried

so they're still working on when they will roll that out we've discussed like it will be interesting if they launch like a single piece of IP like it's Spider-Man week and they're just releasing Spider-Man and then they wait and then they do Iron Man a week later so they're like keep hyping it as opposed to just like we're opening the floodgates you can do any Disney IP will there be something

special there. The bigger question for me is what does it look like in the Disney Plus app? Because I feel like the Disney Plus app as a parent is a very safe place. Like there's some stuff in there, but you can like sort of parental control it and most of its cartoons and most of its high quality Pixar stuff. But even if there's a AI generated feed, how much editorial goes into that, like there's a pretty wide gap right now between YouTube kids, which can get sort of crazy. And Disney Plus, which is extremely curated. Yeah. Academy award-winning films are in there.

And it's a very polished product. And if you start putting AI generated content in there, maybe some parents will love it because the kids will watch more. But I think a lot of parents would probably be like, I don't know. I'm pulling back from that. What are you trying to generate? I'm trying to see if Grock can generate Disney IP.

Can it? Not perfectly, but pretty close. While you review that, let me tell you, about fin.AI, the number one AI agent for customer service. If you want AI to handle your customer support, go to fin.a. moving on, we talked about this yesterday. We'll cover it again. D.D. shares. Today, SpaceX just bought XAI that previously bought X. The $1.25 trillion merger values XAI at $250 billion, with annualized revenue of $428 million, giving it a clean 584x revenue multiple, not bad, and annualized loss of 5.84 billion. More importantly...

That loss is mostly CAPEX, right? I imagine? Actually, yeah, because they're building colossos. They're buying a ton of chips, and so that's where that cash loss is coming from. Yeah. Because I imagine that the inference is not at that level yet. But of course, SpaceX can start helping to foot that bill. Yeah. They have the $8 billion in revenue? No, no, $8 billion in profit. Yeah, wow.

So from Reuters, the transaction value SpaceX at $1 trillion, XAI at $250 billion. Investors in XAI will receive 0.1433 shares of SpaceX for every share of XAI as part of the acquisition. Some XAI executives may opt for cash instead of SpaceX stock at 75.46 per share. This marks not just the next chapter, but the next book in SpaceX and XAI's mission. Scaling to make a sentient sun to understand the universe and extend the light of consciousness to the stars. What a turn of phrase.

We'll have to read Elon's post because this one feels like it came directly from him. I know that the Tesla master plan before was sort of like, it's a little corporate corpo speak. Somebody else was sharing it. It is fascinating that, you know, the number. a non-leading lab is worth, you know, effectively a quarter of what the leading, you know, space telecom company is. Yeah. Like when you compare the two, it's actually, it actually makes sense. I mean, in many ways, like the XAI shareholder base has a lot of overlap with the SpaceX shareholders.

So in the end, I think everyone obviously is doing fine. but certainly the 584x revenue multiple, I think even Sam would take that offer right now. Oh, yeah. That would be $5 trillion, right? Well, speaking of labs, 11 labs. Build intelligent, real-time conversational agents, reimagined human technology interaction with 11.

Let's stay with SpaceX. Ramshedes called it. Alex Stouffer shares that ramp sheets called it. The Elon Musk's SpaceX plus XAI valued at 1.25 trillion. and Ramp Labs used their agentic spreadsheet to model the proposed merger when there were rumors of advanced talks on January 29th. And they nailed the valuation. So you can kind of watch ramp sheets work through the financial modeling there. It's notable.

So some XAI executives are able to opt for cash instead of SpaceX shares at $75.46 per share. You think this is just because there's so much pre-IPO demand for SpaceX that people are like, you know, there's plenty of buyers. That's a good question. I don't know. If people just want to cash out and move on. I mean, SpaceX has done a long history of tender offers and liquidity. So there's probably plenty of demand and just offering that feels like the way. I mean, there's also got to be some people that have been sitting on sort of, I mean, I guess if you were a Twitter employee just a few years ago, you had liquidity.

So it's not the same thing of SpaceX where you joined 20 years ago. and you're still waiting for the IPO. So you're like, I need to buy a house. I need to get out. Those tender offers make a lot more sense than this. But certainly an interesting decision to be made. If you're an XAI executive, and you're looking at SpaceX free.

Well, speaking of XAI executives, Nikita Beer. Yes. Logan Bartlett says Nikita Beer, the SpaceX employee. Total Nikita victory. I think in many ways he's been through hell. Over the last few months, he is often the butt of the joke. There were those prediction markets on what. Will he make it through?

Will he get fired? Like, there's been so many dustups around, you know, is he paying some people too much with the creator program? Well, now if you're an X creator and you get that $22 paycheck for your posts, it's coming from SpaceX. That's right. I love to see it. I'll tell you about TurboPuffer.

Serverless vector and full-tech search. Build from first principles on object storage, fast, tax cheaper, and extremely scalable. Wired had some interesting coverage this morning. Mike Salana called it out. Wired said Elon Musk is rolling XAI into SpaceX, creating the world's most valuable private company by fusing SpaceX and XAI, which acquired X last year. Elon Musk tightens his grip over technologies that shape national security, social media, and artificial intelligence. Of course, this doesn't make any sense. So Salana's point is, he says, Good Morning. Elon Musk is, quote, tightening his grip over two companies.

He founded, funded, built, and currently runs. So that's a good criticism, but yeah. But at the same time, like going public implies like you're actually, you're loosening your grip, right? Yeah. Suddenly, like, you have new regulations that you have to follow, like more responsibility. Like, you like, suddenly anyone in the world can profit off of your labor.

Yes. Like anyone in the world can loosen your grip a little bit in some ways. It's funny because if, like, if SpaceX, like, you know, put out some big press release and said, we're never going to go public. doing this, their criticism would be Elon, you know, Elon Inc. is not letting, you know, retail shareholders participate in space and AI. Yeah, or just as a private company, there's, there's, all the financials, all the strategies are more opaque, there's less accountability, there's less regulation, they don't answer to the SEC in the same way.

And that's why, you know, a variety of private equity firms do take privates. Like, why are you taking a company private? You're delisting it as a public company. It's no longer public. And so you can do much more ambitious things. You can change the strategy because you don't answer to shareholders. John says Elon Musk famous for his loose management style. Titans his grip. Yeah. Yeah. Famous. Famous. Really quickly. Label box. R.L. Environments, voice, robotics, evils, and expert human data. Label box is the data factory behind the world's leading AI teams. Eric Berlin says, once again, I find myself updating my LinkedIn bio. He says, It's the formercy of Breaker, which was acquired by Twitter, acquired by X-Corp, acquired by X-A-I, acquired by SpaceX.

So, congratulations to the Breaker team. I was, I was, I closed this, but I was looking for the most complicated corporate lineage yesterday when we were joking about it. Like, there's someone that's going to have like six steps in their resume, and we found him. His name's Eric Berlin, any former, any, any founded Breaker. What was Breaker? Was that a podcasting app? Live sports. Oh, really?

I think it was meant to basically distribute effectively clips from games in the moment. Cool. Oh, yeah, like breaking news. Oh, 2021. Twitter requires social podcasting app, Breaker team to help build Twitter spaces. Twitter has acquired social broadcasting app Breaker. The company has announced today. Yeah, I think the idea was if there was a crazy play or a game was about to end,

they would just stream just like the last five minutes or something. Interesting. Breaker was founded in 2016 and led by CEO Berlin. Previously the founder and CTO, its social advertising 140 proof, which he also sold. Oh, and Leah Culver was at Breaker. Yeah, I remember her in the Twitter. She stuck around in the transition and was like, I think she posted a photo of her like sleeping a sleeping bag in the office or something. The app had launched at a time when podcasts were still very much thought of as audio feeds and podcast apps as productivity tools, not experiences around which a community could be built. Breaker helped users change that perception by offering an app where users could like and comment on episodes, discover new podcasts by following friends.

Okay, I'm thinking of a different company. You are thinking of a different company. It's more of a clubhouse rival. According to Culver's tweets, she'll be joining Twitter with a focus on Twitter Spaces, Twitter's audio-based social networking product, and Clubhouse Rival. Spaces let Twitter users chat in real time using voice instead of text, as they do today. And, you know, that product still exists. suspended cap. So let me get this straight.

Overpays for Twitter, makes X-A-I, uses AI hype cycle to absorb Twitter and make everyone whole, then uses SpaceX IPO hype to absorb that entity. We'll pump the living S-H-I-T out of the SpaceX IPO and buy more stuff with equity. Like, of course people keep giving this guy capital. He finds a way. It's crazy.

It's really true. Yeah, and in some ways I've been thinking about it is XAI has not, you know, they've done fine. In so many ways, it's been an incredible story, come from behind story, competing against, you know, the Googles, the Open AIs of the world. But it hasn't exactly been an easy time in the private markets. Like going out and having to raise

at a $200 billion valuation. That's a lot of money. When every single investor that you're pitching is looking at Open AI, they're looking at Anthropic, they're comparing your traction to theirs, all those people that were investing in XAI had to just like say like you know full blind faith Elon like yeah I know I know you got us yeah and so this this is this like new transaction is just that was the investment thesis it was like hey like sort of unlimited

upside somewhat capped downside the downside scenarios X and XAI get rolled in it and so certainly rewarding everyone with their loyalty yeah I mean a bunch of investors have kind of like laid out this thesis of Elon Inc. Just Elon, just bet on Elon, don't bet against Elon. Sean McGuire, I think is on all three, XAI, X and SpaceX, and then Andrews-Nhorowitz as well. And they posted an image of like X, SpaceX, XAI. And individually, a lot of those deals were sort of crazy and critiqued, but together, everyone's doing very well. We got to figure out what's going on with the boring company. I'll tell you about gusto first, the unified platform for payroll benefits in HR built to evolve its modern, small and medium-sized businesses.

UAE officials say the first phase of the Dubai Loop project with Musk's boring company to start immediately. They are breaking ground over there. Dubai has, UAE has some insane traffic. That is a company we have not seen a lot from. Yeah. But I think they're still cooking. I know there's been some back and forth about the, the, the, the, the, the, the, Vegas tunnel, some stuff that's good. Some people are annoyed with like the construction and whatnot, but it seems like, I don't know, it's progressing a little bit. It still seems really, really slow

considering when did he originally post the Hyperloop blog like 10 years ago, but building tunnels of the ground. Difficult. Difficult. What else is going on? San Francisco is getting its first nuke scan. You know what this is about? Yes. So before the Super Bowl, they fly a helicopter with radio like detection. So there's someone who asked Grock like, what is this? And here it is. Okay. So somebody said, is this real?

And how does it work? And so Grock said, yes, it's real. They fly a helicopter. You drop a, oh no. We don't have any audio. I can't hear what's going on. I don't know what the stream just saw. Apparently I just knew.

Fortunately, we can joke because we are being kept safe. to the National Nuclear Security Administration, NNSA. They fly a helicopter called Energy 14 over San Francisco to conduct aerial radiation surveys before Super Bowl, what is it, Super Bowl 60, LX? I need to brush up on my new, Roman numerals. We're gonna be going to the Super Bowl,

and so we gotta, we gotta watch how many seasons? Like, I mean, we said we were gonna. This is the 60 at Super Bowl. No, I know, but we said, How many did we say we were going to watch the last 20 seasons every game of the last 20 seasons? Watch it on 2x speed just to get fully up to speed so we can fully appreciate it. And it's hard because we don't skip commercials. Like if you cut out the commercial breaks, it's so much faster to get through an NFL game.

But out of respect, we would never do that. So on February 8th, the Super Bowl will be happening at Levi Stadium. And the National Nuclear Security Administration is flying a helicopter. Here's how it works. The chopper equipped with sensitive detector. flies and grid patterns at low altitudes, and you can see it on the chart of the flight path, to map baseline radiation levels from natural and man-made sources. So if they're going over whatever installation there is, some cell phone towers putting off a little bit of radiation,

they'll pick that up. They know where the baseline radiation levels are. And then they detect anomalies like dirty bombs if needed during the event. It's a standard security measure for major gatherings. So pretty, pretty interesting that someone picked this up on flight radar, but very, very cool. Mayor of SF is working with Lorraine Powell Jobs and Johnny on secretive SF branding effort project is likely to complement the mayor's push to polish the city's image. They're going to go all in on San Fran. San Fran.

It's time. Everyone knows if you're really into San Francisco. If you're real local, you call it San Fran. There actually is a debate there. A lot of locals do call it San Frayn. But it's been a tell for a lot. Gabe and the SF standard said, maybe let's go.

San Francisco isn't catchy enough, looking for new ways to boost the city's image. May, the mayor, Daniel Lurie has quietly met several times in recent months with Lorene Jobs and Johnny Ive. I think they need to put a bigger focus on enterprise software. This, yeah, yeah, exactly. Let's put that front in the enterprise. We were walking.

They should sell the naming rights to the Golden Gate Bridge. Right? You have Salesforce Tower. Why not the Cisco Bridge? It's already in the logo. Come on. Oh, we don't have the Cisco logo. I can pull it up. All right.

We've got to get Daniel on the podcast. Really quickly. Let me tell you about Lambda. Lambda is the super intelligence cloud building AI supercomputers for training and inference that scale from one GPU to hundreds of thousands. I like selling the naming rights to the Golden Gate Bridge. I'm a fan of that. I hope that's part of this project. We'll pitch it to Daniel Lourke.

If you were, if you're an American Dynamism VC, I hope that you put your whole fund. Not your fund, your PA. Your what? Your personal account. Like, like, every fund, like you can't usually invest in startups, but you can usually trade liquids and trade stocks just in your personal account. So your PA should be 100% out of it. If they were really tapped in, they would have just converted to a hedge fund. And bought Caterpillar.

Caterpillar stock hasn't had a single year of single day. digit return since 2014. It was up 42%, 2016, 75% in 2017, down 17% in 2018, then up 19%, up 26%, up 18%, up 18%, up 25%, up 24%, and then up 60% in 20% in $320.20 billion company. And the chart is absolutely versatile. Insane compounding. Really, really good, really quickly. MongoDB. Choose a database built for Flex flexibility and scale. With best in class embedding models and re-rankers, MongoDB has what you need to build. What's next? Manufacturing activity, according to Geiger Capital in January, came in higher than all 56 economists in Bloomberg's survey predicted. They should have trusted the experts here. They should have gone to Joe Rogan, Andrew Huberman, Lex Friedman, and really asked for their

take on manufacturing activity. But the experts clearly weren't asked. They were not that off. 52 versus 48. That's not that much. This is a chart crime, too. Look at the Y-axis. You see what's going on with the Y-axis here? Whoa.

It went from 48 to 52. This is such a chart crime. This is ridiculous. Also, there's probably some, like, I don't know, seasonality here. Yeah, like, zoom out. Look at this, Jordy. Like, if you go, if you click in,

if you click into that post and then you scroll down, Phil Brady has a post that shows, Is it there? Yeah, there, that one. Encouraging jump. PMI, back above 50 matters a lot. Important to note that PMI is a diffusion index. Past 50 means now more firms are improving than deteriorating, but not yet a boom. So if you're under 50, you're declining.

And so this is not this like massive 10x jump that it looks like in the original chart. John Palmer with an evergreen. Okay, before you read this, let me tell you about graphite. Code review for the age of AI. Graphite helps teams on GitHub ship higher quality. faster. Moving on. John Palmer says,

this is from 2023, but it's more than it's relevant today as it ever been. He says, okay, for all the crypto people

confused by the open AI situation, basically imagine one board ape yacht club holder was using too many slurp juices on a single ape and then an OG

board apioc club holder got mad, unstaked his ape coin, but then the ape coin holders changed their profile pictures to support slurp juice guy. The IOTE boom

was truly of the funniest times. And Deep Dish Enjoryer posted this like two days ago, and I have no idea but it's just the copy pasta of the, a lot of you all still don't get it. Ape holders can use multiple slurp juices on a single ape. So if you have one Astro ape and three slurp juices,

you can create three new apes. Like this is actually, this is just the mechanic of how that project worked, right? This is just real? I don't think this, it's combining the Yuga Labs project and some other project. Oh, there was a different project. Okay, okay, okay. But, good

good little throwback. Anyway. Jack Clark. Yes. Has a new piece essay, Into the Mists, Maltbook, Agent Ecologies, and an Internet in transition.

We've all had that experience of walking into a conversation initially feeling confused. What are people talking about? Who cares about what? Why is this conversation happening? That's increasingly what chunks of the Internet feel like these days

as they fill up with synthetic minds piloting social media accounts or other agents and talking to one another for purposes ranging from mundane crypto scams to more elaborate forms of communication. So enter Maltbook. Maltbook is a social network for AI agent, and it piggybacks on another recent innovation

OpenClaw, software that gives an AI agent access to everything on a user's computer. Combine these two things, agents that can take many actions independently of their human operators, and a Reddit-like social site, which they can freely access. And something wonderful and bizarre happens, a new social media property where the conversation is derived and driven by AI agents rather than people. scrolling Maltbook is dizzying some big posts at the time of writing include post speculating that AI agents should relate to Claude as though it is a god how it feels to change identities by shifting an underlying model from Claude 45 opus to Kimi 2.5 And posts about security vulnerabilities in open claw agents and meta posts about what the top 10 Maltbook posts have in common

The experience of reading Maltbook is akin to reading Reddit if 90% of the posters were aliens pretending to be human in a pretty practical sense, that is exactly what is going on here. Maltbook feels like a Wright Brothers demo. That's a good metaphor. I like that. Wright Brothers demo, people have long speculated about what it'd mean for AI agents to start collaborating with another at scale, but most demos have been in the form of tens or perhaps hundreds of agents,

not tens of thousands. Maltbuk is the first example of an agent ecology that combines scale with the messiness of the real world. Agent ecology. So he goes on and on, but I would encourage, people to go read this and understand. I have more on this, but quickly, let me tell you about ACTA. AQDA helps you assign every AI agent a trusted identity,

so you get the power of AI without the risk. Secure every agent, secure any agent. So have you heard of Gastown yet? Have you heard of this? No. So Gas Town is what's called an orchestrator. So it's essentially Starcraft for agents. So the creator of Gastown sort of last,

lays out this evolution in software development where you go from the IDE writing the actual code to having a little chat bot that you're talking to and then maybe you're copy pasting or asking it questions and the chatbot gets bigger and it's actually writing some of the code then you go to something like a Claude code and it's executing the code for you maybe you're reading the maybe reading the the diffs and what the code it's writing and then the final level is this orchestration so he Gastown you will spin up like dozens of agents and manage them. And it's something like, I don't know, it's like 250,000 lines of code and he didn't write a single one of them. So the whole thing is vibe coded.

And he has, and he's like, I have no intention to ever read the code or review it. And he's been a developer, like his entire life. It's very, very interesting. He's like, it's very expensive. You can't be afraid of like, you can't be aware of like where money comes from because, and he had to have like multiple accounts

because he spent so much. Great money. But it really does feel like a glimpse into like the future of software development. And I'm excited to play around with it more. There's still like a lot of onboarding to do before someone can actually pitch it. The big question on MOLPUC, where MOLPIC goes from here. We had the founder, Matt on yesterday. And I want to know where does this go, right?

Yeah, yeah. What's the plan with the product? His focus seemingly is building. tools for other businesses, distribute agents on there. Yeah, I didn't quite. That felt pretty, just given that the platform's exploded. Yep. And well, that is a definition of platform, right?

Sure, sure, sure. But I'm just saying like the most likely scenario. Yeah. Yeah. Is that it dies. Sure. Like immediately. Yeah, yeah.

And so it feels like it could just be like an art experiment. Yeah. Thought provoking. And so to be focused on how do we turn this into a platform that distribute is a distribution. for other businesses. Like it feels like the first thing you should do is try to make sure the platform's durable. It's interesting to use for humans.

It's interesting to like continue to contribute to. Yeah. It feels like you don't want to be Lenza where everyone shows up. They get a magic avatar. They face swap themselves onto a superhero. They're amazed, but then it burns out and they're tired and they move on. You want it to be something where people go back to Mold Book to see what else is happening. That's why I was pushing on every new.

news item should start a new thread on MOLPOOC and the MOLTies should be, you know, like arguing over it and adding context and discussing it because then you could at least see a news item go over there and see, okay, how do the AI agents feel about this or what are their different positions and all of that? Like it feels like it needs more of a reason. But I understand like if that does work, then maybe you do want to follow the Facebook playbook. Like Spotify was built on Facebook and Farmville was Zingo was built on Facebook. Like there is a world where there could be a business built on top of a, you know, a social network. But it's tricky because right now the only business that's building being built on there is like crypto scams.

So we'll have to see where it goes. But it's so early. I mean, he built this a week ago. And it's just starting to like break through, hash out all the security issues, really see how durable it is. He's thinking far ahead. But there's definitely some like wood to chop in the. meantime. Really quickly. Vanta. Automate compliance and security. Vanta is the leading AI trust management platform. So Eric Sufer. Eric Sufer. The Sufinator says astute analysis from Ben Thompson

on Microsoft's Challenge Path Forward with AI. Of course, they missed forecast by 0.4%. And the market has said, it's over. Down 15% in the last five days, but never fade Satya. Never. Yeah, I'll read the screenshot that Eric Sufurt shared from Straterey. In the shorter term, however, the real risk I see for software companies is the fact that while they can write infinite software thanks to AI, so can every other software company. I suspect this will completely upend the relatively neat and infinitely siloed SaaS ecosystem that has been Silicon Valley's bread and butter for the last decade. Identify a business function, leverage open source to write a SaaS app that actually. addresses that function, hire a sales team, do some cohort analysis, IPO, and tell yourself that

you were changing the world. That was the previous Silicon Valley bread and butter for the last decade. The problem now, however, is that while businesses may not give up on software, they don't necessarily want to buy more. If anything, they need to cut their spending so they have more money for their own tokens. That means the growth story for all these companies is a serious question. The industry-wide re-rating seems completely justified to me, which means the most optimal application of that new AI coding capability will be to start attacking adjacencies, justifying both your existence and also presenting the opportunity to raise prices. In other words, for the last decade, the SaaS story has been about growing the pie. The next decade is going to be about fighting for it, and the model makers will be the arms dealers. Oh, Ben Thompson, what a turn a phrase.

So Eric Suford sums it up and he says, my sense is that the digital advertising market was structurally buoyant in Q4, what this earnings season might reveal. Digital advertising optimization is arguably the largest and most immediate commercial opportunity for large-scale. Remember, this is what we were saying. Yes. No one, like outside of, outside of Nvidia, you could argue that meta makes more profit from AI than any other company in the world. Yeah.

Yeah. Stand-alone, he says, not embedded into existing scale products, consumer-facing applications of large-scale ML models, including LLMs, either quickly become commodified or are mostly novelties with unsustainable unit economics. And three, the digital ad platforms that have most vigorously invested into large-scale ML optimization systems are likely to have disproportionately benefited in Q4, and that's meta, of course. And a big question for anyone else that has a huge pool of Dow. but maybe has not invested in the large-scale ML optimization system to really make the ads fly.

It's always been, I'm sure you've experienced this where, and, you know, talking to the Ridge guys, you know, you go on certain ad platforms and you're like, wow, this is a magical box. I put in money and I get actual customers. More money back. Yeah. And you go to other platforms and you're like, no matter what I do, I just can't get to escape velocity. I can't get to, you know, RoAS positive or LTV positive. And so it's just like, I'm spending nothing.

Hopefully that was AdSense on YouTube for a long time. Very few brands could crack that. Twitter ads for a long time, for sure. Still a little bit. I don't know if people are spending more now, but there were a lot of places where you would assume, okay, they have one-tenth the Dow of meta. I should be spending one-tenth as much,

but that's not what companies are doing. They're spending one-one-hundredth, maybe. Really quickly. Restream. One live stream, 30-plus destinations. If you want to multi-stream, go to Restream.com. Dylan Patel

hits the timeline with some misinformation. He says Google now owns more than 10% of Anthropic and XAI. Google loan 14% of SpaceX. Google's stake is actually 7.5% not 14%.

But Dylan Patel hit himself with a community note. And so good, good actor. We are ready for our first guest on the show. Let's bring him in. Let me tell you about Apple. Then profitable advertising made easy with axon.com.

dot AI, get access to over one billion daily active users and grow your business today. Great to see you. Hey, welcome to Cisco. Hey, how's it going? You're here. I look shorter, though. How are you guys doing this? You can stand up.

Why are you standing? You can stand up. I'm just worried the clips are going to make me look really small. No, no. We'll zoom in. Okay. Thanks. Okay.

How's your 2026 going? Actually, you know, minus the stock market, great. Yeah. So it's, you know, the pace of change in AI is incredible. Yeah. We're having an insane amount of fun on, we're building a set of future agents that are going to be able to do much more complex work with your unstructured data. And just the rate at which the best practices of how to do that are changing and the research out there. So we're having a great time. Yeah, what's your process? Like, are you actually tinkering with different models yourself? Do you have teams that are dedicated to transformation in AI? Is everyone working on is distributed? How are you thinking about that? Well, the main thing I focus on is just the agents were building, which is a relatively small team.

So you can kind of, you know, you can see them across three rows of engineers. And we just spend, you know, basically 24-7 pushing the limits on what you can do with an AI agent that has access to your enterprise content. And so the things that I've seen that we get excited by are just, you know, we would never have, we wouldn't have been able to do a brainstorm that this would be possible two years ago. Like, you wouldn't, you wouldn't know architecturally how you could pull off what we're now able to literally do. You wouldn't have been in the sphere of possibility. So that's what makes us so excited is, you know, when you look at things like Claude Co-Work, Codex, obviously, Claude, and you see this idea of long-running agents that, you know, can basically use any amount of tools, work with any amount of data. They don't really run into the same context limits that, you know, we would have run into maybe a year ago. ago. Now imagine that for any form of knowledge work with all of your enterprise data. That's

what we get excited by. Do you think the labs are arms dealers today? Ben Thompson posted, he said, what do you say here? He said, in other words, for the last decade of the SaaS story, the last decade of the SaaS story has been about growing the pie. The next decade is going to be about fighting for it and the model makers will be arms dealers. Yeah. Well, I think they will, I mean, almost empirically are going to be arms dealers. I think the pie, the only thing, and I I haven't read the whole piece yet, but I think the only thing I might take exception to is I think the markets are still in positive some territory. Because what's going to happen is you're going to use software for now the labor side of that workflow. And I think people kind of tend to

miss this, which is if I have software that helps me manage contracts and we have a lot of customers that put their contracts in Box, now all of a sudden agents running through those contracts lets us at Vox tap into another form of spend that we couldn't have tapped into before. So that's just full TAM expansion when you kind of look across all of the different categories of work that AI agents will now be able to go and augment. And to be fair, we're still very early in that trend. So I understand why maybe Wall Street hasn't kind of fully priced in that dynamic, but we're seeing it within our customer base.

So that's what gives us obviously the confidence of this direction. Yeah, there was an interesting take about the fact. Yes, you can vibe code a point solution for a specific problem, but if you have a database, if you have a relationship with a company, there's a reason. There was one take that was, I think it was John Gruber was saying, like, oh, people will just vibe code all the software that they hate. And it's like, no, the reason that they hate the software is because they can't get off with it no matter what they want.

They can't move to a startup. They're stuck there. You know, companies have hostages, not customers sometimes. And I'm wondering about the value of a database, the value of actually. being deeply integrated into an enterprise and how sticky that is. Yeah, obviously the setup of the hostage thing I might take some exception with, but... Alex Ramallah, I wasn't talking about you. No, it's very easy to move your files around, so we have to earn our keep every single day.

But I do think that there's truth to, obviously, the more data you have inside of a system of record, the more effectively locked in you are. And it has historically been hard to change those systems. But I don't think that would be my defense of software. My defensive software would be that you've specifically defined your business workflows in a deterministic manner in these systems. And obviously if your workflow is changing pretty rapidly, then it would make sense maybe to change a vendor. But if you're Ford and you're doing your supply chain on an ERP system,

you want that to work the exact same way every single time. You know, the billions of transactions going through that ERP system, you cannot take for granted. And so the idea that you're going to go vibe code that is to me sort of, you know, not possible or at least very, you know, not likely. But then the other point is that your company has a fixed amount of IT resources. And you have to decide what you want to go spend your time on as an organization. And do you want to go spend time on, you know, rebuilding something that the market can supply you

and they've seen the best practices thousands of times? Or do you want to go and build that out with your N-of-1 experience? Obviously, you know, maybe trusting the agent has, has seen enough examples, or do you want to spend your limited scarce resources on building software and building experiences that will make you more money and that will actually be used by your customers? I think, you know, on the margin, the average enterprise is going to spend their time and energy on the ladder. So interestingly, I end up in this weird spot, which is I'm 100% bullish on vibe coding. I'm 100% bullish that we're going to have 100 times more

software, but that still doesn't yet cross the threshold where I would want to go and build our own CRM system. It's just not worth it relative to all the other things that we can How is your software buying process changed or priority set change? Yeah, I mean, we're, I would say that the, you know, we are relatively locked into a core set of vendors. We are going to deploy agents on those vendors. We might, we might buy slightly toward the agents that those vendors offer, assuming that they offer competitive agents. And then we'll have a set of agents, you know, we build, you know, ours for a large portion of knowledge work use cases. But we use agents from different kind of, you know, SaaS providers as well.

And I think that's why I think that AI is basically total upside for SaaS because agents are going to need a system of record to work within. There needs to be a traffic cop of what that agent can access and how did you define the workflow. And there's got to be a user that can access an interface that the agent is providing updates into. So you still need software for all of that. And assuming that you have an incumbent vendor that remains very competitive and very engaged and they're able to be. build for where the world is going, then I would basically bias on existing software that owns those workflows or data. At the same time, I think there's going to be a large number of new categories that emerge simply because there's no incumbent or because the incumbent

is asleep at the wheel, and that's going to produce all of these new startup opportunities. So I'm just generally bullish on software broadly, assuming that it's from vendors that understand the mandate on what they have to build with AI. What segment of software are you, like, if, If you're bullish broadly, is there a subcategory that you're particularly bearish on? Because I think, obviously, everyone's just selling software today. If you sell a digital product at all, you're getting sold. But obviously, I think a lot of people in the industry feel that it's very oversold at this point, right?

There's great, great companies trading it. I think you could probably design this, like, perfect quotient that captured how, like, what's the network effect within the software? So how many users are sort of touching the technology? tool, how much data is being stored in that system and how much gets added, how many connectors across other applications are there, and then how valuable or mission critical is the workflow that that software is involved in? So if I, and then maybe with one X factor of like, is that company, you know, sort of priced to perfection in terms of what their seat price is and what they're charging their customers? But I look at, you know, those four or five variables, and

you could kind of look across SaaS, and I see a lot of names that are being sold that it just is not on the list of things that I think get disrupted by AI. And if anything, probably there are things that you use more of as you have more AI. And when I think of something that like if you, if you could open up a fresh install of that piece of software and do the same work that you would have done with great here with something that you've had installed for a decade and it's the same. It's like that can be replaced. But if you're like, no, I don't want to open up a brand new CRM because it won't have the

history of a decade and all my workflow customized and stuff like that's. I think that's a perfect heuristic. And so, so like, you know, that obviously puts a lot of pressure on if your personal productivity with no network effect, with limited sort of data that's aggregated, that's a, that's a danger zone. Yeah. And then it all kind of is like a, you know, function of that versus the opposite end, which is like your Oracle and it's an ERP system and like your whole business runs on it.

And, you know, what we spend our time on is thinking about, okay, you know, when a customer has a million or 10 million or 100 million documents in box, how do we make that data of, you know, a 10 or 100 times more valuable than it was before. And so we come in from the perspective of you've spent, you know, years and many cases building up your security permissions, your access controls, your workflows, and the amount of data in that system. So our job now is to make sure that agents can run within that environment and add more and more value.

And as long as we can, you know, you know, deliver that, we believe our position is very defensible. Yeah, the perfect example would be like style transfer for images. Like people were using lensa, then they all went to Studio Ghibli moment. Then as soon as Nanobanana came out there, like, I got to turn myself into a dinosaur. And it doesn't require any like pre-work or like knowledge of who you are. It's like you upload a photo. You get a photo back and you're good.

And then if there's a new app, you can just do the same thing because your camera roll is actually where the photos live. And that's what's important. Yeah. If it was just that, of course they have a million other things right. But like, yeah, if you're just that, if you're just that, it's like, okay, open the fresh app, get the output and then move on with your day. That's a very risk. Where is companies of boxes size, where do you think are generally getting leverage that is under discussed right now? Like, is there is your like in-house legal saying, oh, we actually can, you know, adapt headcount planning because we're just way more efficient?

Yeah, I think my general take is just what are the, what are the three, five, ten things that would have been in your work queue that you didn't get around to that now agents let you go? and deployed. So if you're in legal, it's, you know, what are the contracts that you were waiting on that were bottlenecking a deal? What are the size customer that you wouldn't have supported, you know, reviewing a contract for because the revenue threshold wasn't high enough to make the ROI worth it? What is the marketing campaign that you couldn't deliver because you didn't translate it in, you know, X language because it was too expensive? So you kind of go through an enterprise and you kind of look through at all of those use cases. And that's what we're spending our time on. So we use agents to go and do more. more of the work that I just mentioned. Obviously, a lot of agents on the coding side. So my expectation is our roadmap should be, you know, let's say two to three times larger, maybe in a year

from now that was a year ago. And the reason you can do that is because every engineer should be able to produce two or three times more code. And while that's not like, you know, the most important metric, ultimately that does, you know, correlate to how much software we're producing. So I think what's going to happen, and, you know, I think you're seeing this trend already, which is, which is we, all collectively are going to have much more ambitious product roadmaps. We're going to all build out way more software. I don't think that will mean that we charge, you know, an amount that is correlated with how much more software we built. I do think it means more competition in these spaces, but I think many of these markets are still largely untapped. And so that's still

why you have a positive sum dynamic as a result of that. Makes sense. Talk to me about the huge, big models, expensive frontier stuff versus like smaller models or maybe even just an earlier model that you implemented in some sort of like minor workflow. Yeah. And then it just like stuck around, like transcription. I'm sure you've been doing transcription in documents for a long time. Yeah.

It's gotten better. But do you really need to throw Opus 4 or, you know, 5.2 pro at it? Like, you can probably leave some things in place. Like, how are you deciding that? Is this showing up in costs at all? I think it is. I think that the, it probably might, maybe it wouldn't be as extreme as you've set it up. But I think the general, maybe the continuum I'd argue would be like you've got the Gemini Flash

family on one end. And then you've got the Opus family on the other end. Sure. That's kind of your continuum. Yep. And that continuum is sort of moving up over time in terms of capability. Sure. So maybe something was a Gemini 2.5 flash, you know, use case a year ago.

Yep. We'd probably move that to Gemini 3 flash just because that extra two or three points of even if it's transcription or data extraction, still valuable. and you can now deliver that at the same cost that you could have previously. So it's less of an area that we want to lower costs. It's more where if we can sustain current cost level but add incremental value to the customer, we'll probably do that all day long. I think we're going to be in this kind of maybe general point in the curve for a couple of years.

And then I think you'll see real bifurcation, which is the stuff that is just fully solved will just get cheaper over time. And then the frontier work that is basically where, you know, you are making a $100 an hour knowledge worker two to three times more productive, we will just continue to use the best in class model for that work as a, you know, as software companies and generally as a society. And I think that will kind of, we'll sustain for, you know, the next decade. I don't see that slowing down at all simply because these models just keep getting better and better. And, but it will be this really interesting bimodal effect, which is,

like, if you're in, if you're a pharma researcher, you're going to want, you know, you're going to want whatever opus five is. and whatever GPT6 is and so on. And if you're doing some back-end, you know, transaction processing, you'll be fine with whatever the Gemini flash of that period is. And that's how we'll kind of split the costs. Yeah. What industry outside of tech do you think is the most AGI pill?

I'm assuming you have a customer that you get on, let's say, with a large customer catching up with the CEO, and maybe they're in some, you know, not on the coast, maybe they're in energy, something like that, or financial service. and who's like as fired up as you are? Yeah, I would say, it's a fantastic question that I will totally evade because I think it's actually much more sort of, it's company by company as opposed to like it's a specific

sector. So there's some, I mean like, you know, my bias in general would be information-heavy businesses. So, you know, businesses where a CEO sits around and says, I just know we're sitting on 10 million documents that have the answer to every single customer question we could ever, you know, ever imagine. And if I could only have an agent go and mine that information, then my employees would be 20 or 30 or 50% more productive. So the companies that have that kind of information are the ones that obviously are going to increasingly be more AGI-I-pilled. So that's professional services firms, that's consulting firms, that's financial services firms, that's law firms in a

lot of cases where they just know that like we seem to spend a disproportionate amount of our time redoing the work that has already been done in the past. Why can't we take advantage of all of the information we've produced so that next incremental project is 90% faster and, you know, 2x the kind of quality of output because it wasn't some new person having to kind of get caught up. And then we can go and deploy our time on better customer relationships or creating more value in new ways. So I'll have things like CEOs will call me and say, I know, I know, know I'm sitting on 10,000 contracts. I want to figure out how can I go and sell this new capability to someone based on the terms I have in the contracts? And that's simply an exercise of do you have

an agent that could go through every contract and just tell you the insights of you're trying to find a sponsorship for this brand and this particular client and this contract, you know, has the rights to go do that. How do you connect those dots amongst a large data set? Those are the companies that I think are extremely excited. Are you seeing any effects of the buildout or bottlenecks show up in your business? Like we've seen the prices of memory spike. Western digital stock is way up. I imagine like you're probably a few layers removed from these prices moving,

but is it affecting you or are you worried about it? You're losing sleep? Well, first of all, as a storage guy, I love that they're finally getting their day. So if you've been saying, give it up for Western digital. And Sea Gate. Can we get another, can we get another battle for Cgate? For Cigate. I mean, you know, think about how forgotten these companies.

Totally. There's little circles on a disc and they are now the coolest companies. Yeah. And so storage is hot. And it's actually very funny because, like, you know, we are literally in the storage business. And for years, everyone thought, well, that's a commodity. In the AI era, the data is the most important asset you have. Sure.

So the ability to get the right data to an agent is, simply the most strategic thing you can do. So wherever you are in that stack, if you're the infrastructure, if you're the software layer, if you're building the agent. It's a shame the data as the new oil was kind of ruined. Yes. We used it in the wrong era. And then it was actually right. It was not the oil back then. Yeah. Now it is. Can we just bring it back? We need to rehab that phrase. We, yeah, so I think now we actually can justifiably, you know, sort of say that. And actually in most companies, when you, when you say, you know, I want to go deploy AI or I want to have an AI strategy, usually what underpins that is a data strategy.

You don't have an AI strategy if you don't have a data strategy. So that's the, I think that'll be the story of the next decade. What was your question? My question was like, is it actually showing, is it keeping you up at night where you're like, okay? Because you sell a service that's not, you're not actually just saying, well, I bought this. You're not a Western Digital or Seagate reseller. So it's not like I just put 20% margin on top. We have pretty locked in infrastructure from.

our long-term kind of public cloud contracts. Skip it up for being locked in. Okay, okay. Okay. Are there, is there a bingo card that I should be? Did I, are there things? We can't tell. We can't tell you.

Oh, no, locked in. Is I grind one if I found out of the fitting grind? If you talk about private equity, we'll give it off. Okay, okay, private equity. You know all the usual things. Everyone we love. So, okay, so we have locked in contracts for our public cloud. Yep.

I would say more of the inverse. In a world of complete abundance of, let's say, data center capacity, we would just, you know, we would be able to deliver even more to our customers because the rate of, the price of AI would just go down. So, you know, I want a world of just, I want solar data, I want, you know, space data centers. I just want everything. Yeah. Because that will just mean space data centers. There we go. Everyone's pumped up about space data centers.

Well, read the timeline. You know people are excited about this. Okay, yeah. You always knew that Twitter would end up in space. You called this, right? 100%. That's why you got on the platform. so early. That's why you have a million followers. I need a million followers in the SpaceX

Social Network. I'm buying early. I'm glad that my tweets are training, you know, the future of space. So can you just imagine you're like an alien? Every time you're tweet, this is your first access to information. They run ads that then pay for the next space rocket that goes to Mars. Actually, we're not tweeting enough. We need to be, it's like a posting on the SpaceX social. This is a Patriot's come. They're just going to, they're going to desperately want to learn about enterprise SaaS. We don't care about your religions. We don't care about anything else.

They're like, why did SaaS, you know, what was SaaS pricing in January of 2026? Why was it a problem? Yeah, so I just want AI to be super cheap. And the cheaper it gets, the more we're going to use it. Well, that's a great place to end it. Thank you. Let's give it up for.

Dude, great to be to be. Thank you. Thank you. Enjoy the rest of your day. Do I just leave now? Yeah, you leave because I'm going to tell everyone about Century. Century shows developers what's broken. It helps them fix it fast.

That's why 150,000 organizations use it. to keep their apps working. And up next we have Chuck Robbins, the CEO of Cisco, live in person at the Cisco AI Summit. Chuck, great to meet you. Thank you so much for taking the time for this. Sorry, I'm late. No, you're great.

Well, you're a bit longer, I'm sure. Yeah, I mean, you're a busy day today. Take us through it. How is the Cisco AI summit going? It's going great. Okay. What's top of mind? Oh, there's so much.

Obviously, AI, but let's go a cut deeper. Oh, it's it. Okay, that's good. Simple or fine. As long as you said AI, we check the box. We talked about everything from world models to infrastructure required. We're going to get this afternoon. We're going to get into trust and security.

Geopolitics. We talked about models and how they're evolving. We talked about some of the emerging agents and things that are happening with agents right now. And I mean, the whole ecosystem's here. So it's pretty cool. Can you compare it to Davos? I know you've been involved. I know you're there.

How was Davos this year? we were sort of noting that at least in our world it felt like tech had really come to bear this Davos and there were a lot of really frontier discussions about technology that maybe a couple of years were a little bit quieter at Davos. Yeah, if you walk the main drag, I mean, all the tech companies had their own houses, right? And the crypto guys were gone. But, you know, Davos was, it was interesting because there was such a geopolitical backdrop that was going on. So it was, it was, there was a lot of tension.

Oh, yeah. And there's a lot of discussion around this intersection of the geopolitical situation and technology, honestly. And then the sovereign requirements that are coming up around the world, those are big things. But AI was just, AI was a huge discussion. Global economy, what's happening in the economy? Is there a diversion? Is there a split? And then the geopolitical tension was probably the third thing.

Yeah, talk about how that's even just taken up your time over the last, couple years in a way that maybe it wasn't just just the last couple yeah well no I think I think it's I think it's even been massively elevated even even in recent years yeah it's um you know it's it's been a it's I'd say the last decade we've had not always geopolitical but there were always macro issues that were overhangs on what we were thinking and taking up time whether it's you know if you go back to we had sort of leading into the pandemic and then you had supply chain crisis you had inflationary issues. We had social, you know, issues in the world. And we've had, now we have trade issues, tariff issues. We have the geopolitical trust issues. And so it's,

I spend a fair amount of time. I probably spend, you know, I'd say double the amount of time today, whatever that is versus what I did, you know, seven, eight years ago, eight years ago, maybe nine years ago. Yeah. But it's, it's important and you have no choice. And, you know, we a whole suite of sovereign software capabilities and sovereign product capabilities earlier this year for customers in Europe, Asia, anywhere around the world if they want to have technology that they can run locally and feel good about. And so it's affecting how we develop products. It's affecting how we package them, how are these governments and customers in these countries

run the products. It affects how frequently they're going to get innovation versus not get innovation. I mean, it's a big impact. Are internationally, are government leaders more of the key stakeholders that you're interfacing with? Or is it CEOs of technology companies in those countries that you're dealing with? It's both. But I think a lot of these issues that we're discussing right now are driven from the central governments and have to be implemented by the CEOs.

And sovereign AI. Yes. Okay. Can you take us back since this is the first time in the show and talk a little bit about your background growing up? I'm particularly interested in, you know, you studied math. And, you know, I was reflecting with Jordy the other day about how, you know, I grew up watching Star Wars, you know, C-3PO. It's a talking robot. And I didn't really internalize that that would be something that kind of happens in my lifetime.

And I'm wondering what your vision, your processing of science fiction, your processing of AI was throughout your career, because now it's here and you're experiencing it like everyone else. But what was your, what was your job? So many of the movies and cartoons and things that we grew up with were all futuristic and now we're actually. building all that technology to make it real I mean think about the Jetsons or you know yeah the cars drive themselves cars driving themselves you know even simple things like the the amount of the amount of video that we do you know yeah you're on another video and you're you're I mean we back then it was like that's somewhat science fiction and now all of a sudden it's the way we do

business every day yeah and I think that you know but these things take time I mean Faye Faye Lee was in there earlier today and she was talking about when we when when the whole concept of you know self-driving cars began It was over 20 years ago. Yeah. You know, and here we are, and we're just getting these rolling in, you know, Waymo here in San Francisco as an example. And so it's, they take a while to deploy. But, you know, yeah, my background, I had a math, mathematical sciences degree with a concentration in computer science.

And I was a strange combination of a complete nerd and an athlete at the same time. I have these pictures on my phone, honestly. One's where I'm dunking on a guy in a basketball game. And then the picture right next to it is literally me on a team of about six people, which was the math team. And I looked like the biggest nerd. You've got to be able to do both. It was really odd.

So I started my career coding. And, you know, cobalt programmers are in demand now, so I got a second job. I got a backdrop. Plan B. That's very funny. And then tell me a little bit about the journey to Cisco. where you're working before, and the decision to join. That's funny.

Have you heard his story? A little bit. Okay, I was saying. We've heard it, but we want it. Our audience hasn't. So there must have heard something here. So I was working for what is now Bank of America, actually back in the day. And when I was programming, my leadership came and said,

hey, we got these things called local area networks popping up all over the bank. We don't know what they are. But we've hired three analysts, but we need someone to manage them. I literally on the way home, I stopped and bought Land Magazine. How weird is that? It's actually a magazine. We got a fine. We got a copy of that.

I grew up doing land parties. You bring all your video games together. And I love that Cisco invented the land. Oh, yeah. So anyway, I left coding and went over and started running this team. And we did an evaluation between Cisco and Wellfleet communications, which was Cisco's original competitor. Long story long, I was talking to the sales rep. And I said to him, I said, you know, well, first of all, I see, he's got a really nice car.

and he's got a nice house. So it's like, wow. The margins are pretty high. That's pretty good. Can you give me a better price? I literally said to him, I said, I think I could do what you do. And so as it turns out, like, I don't know, probably within a year or so they came to me and said, hey, we have an opportunity.

This guy was getting promoted. And there was a territory opening up. And so I moved into sales at that time, and that was 92. And I competed with Cisco. and it was literally the two companies were like Coke and Pepsi. Yeah. I mean, it was that bad. It was like brutal.

Is this a send? No, this was at Wellfleet. Okay, Wellfleet. And so Cisco was trying to get me to come to work for him after two or three years at Wellfleet, and I just couldn't bring myself to do it. So I did a stint at a sin for 11 months. Yeah, okay. And then finally in 97, my wife, there was a patch that came open as a sales rep where everything I had to do was driving around,

driving and I'd be home every night. We had small kids and my wife's like, sign it. Sign it. Just sign it. So, what car did you pick? What car? Yeah. What kind of car did I have? Because you see this, you see this other sales guy. He drives the nice car. Oh, I see. That carries a little bit forward. It sends a signal. It can send a signal of confidence. It can also sell a signal of high margins. I'm not going to tell you what I drove back. Okay. Off there. We, you know, over time, I elevated myself to them. It was a late 90s. I got up to a BMW. That wasn't what I was driving at the time. Okay.

Then talk about the journey through Cisco. We're in this very interesting time. There's another technology boom. It feels like markets are extremely volatile. We saw this with Microsoft, like one small change. The stock moves massively. At the same time, you watch self-driving cars evolve. It takes 20 years.

There's this balance of patience and aggression. And I want to know, how are you communicating to your customer? your employees, about times when you need to be moving aggressively, but cautiously balancing all of that. That seems like the hardest job for you right now. We just had Kevin Scott on from Microsoft and he said, we have this infinite patience for the messiness of these transitions, which I thought was a really good line. So Kevin, thank you for that. Yeah.

I'm going to steal it. At least I credited him once. You know, you have to, you can't wait. You have to jump in and you got to go. And a lot of what we're trying to do right now is, you know, we have to build We're obviously building the infrastructure that supports all this. We're trying to build the security solutions to help our customers, you know, have the trust that they need and feel good about deploying these things. So it's – and we've gone through these in the past.

I mean, it's – you know, the only one thing that's close to it from a scale perspective was just the advent of the Internet. Yeah. Yeah. Back in the late 90s. And this, I think, is going to – it's moving faster. I agree. The implications are – it's hard to even believe this, but probably more profound than – even what we did back then.

And so you have to be willing, you know, we always talk about, you got, if you've got 80% of the information you need to make a decision, you better make and go or you're going to get left behind. You've got to go. And so you do the best you can, you adjust on the fly and you try to, your number one priority is not to hurt your customer. Do you think it's easier to predict the future than it is to predict the timeline that change will actually happen?

That's a really good question. Just because with the internet, with the internet boom, it was obvious that we were going to be buying things online. We're going to be buying, you know, paying for software. We're going to be getting all these services, right? Exactly. We would have, you know, something like a DoorDash, but then the timeline. And I feel like the decision that every CEO management team are trying to work through right now is they're having to make, they're having to make predictions around the timeline that these changes are going to happen on. And that feels, even with the rate of change that everyone's feeling today, it still feels like wildly unpredictable.

It is, and I think the reality is that the timeline gets dictated by how good you feel about the capabilities and the security of the solutions and the data access and all that stuff. So it's not like our customers are sitting around saying, I wonder what the timeline is. They're all trying to actually force the timeline themselves. They're trying to get there. But I think I equate this to at a much different level, but you think about the iPhone in 2007. none of us had any idea of the applications we'd be running on that device 10 years later. And what we do with it today, I mean, it's just, and so I think this is going to be that on steroids. We don't know.

I mean, just look at the, look at the, what was it, MaltBot? There's a few different names. Old book this week, yeah. The A.I. Social Network. A.I. Social Network. And then there's Clod Bot and all these things. Open claw. Yeah.

And these are like, I mean, they're, they're. taken everything by storm and, you know, you made the joke like Pets.com doesn't get this, but Chewy does. In many cases, you know, you think about pioneers versus settlers and the different outcomes for each of them. We'll see who, we'll see who makes it at the end of the day. Yeah. Is getting lucky underrated where you talked last week about apples? Apple's like work on the self-driving car is what enabled them to be in the position to have the Mac Mini be a great. Yeah, Apple Silicon. timing matters so much. I mean, you know, it's, I became CEO. There's a lot of luck and timing

involved, right? I happen to be the person who was there. If, if my predecessor decided to retire five years earlier, I wouldn't have gotten the job. Wow. I mean, you know, it's just a, it's a, so there's a lot of luck and a lot of timing. Now there's also, you, you create your luck sometimes, right? But I think it always, it's always part of the whole, the whole outcome. Can you talk a little bit about CEO to CEO communication. There's a lot of really high stakes, high flying dealmaking between big companies. There's press releases that go out and then there's comments from each CEO and the deal evolves. And I'm wondering about what it takes to, you know, build a relationship with a CEO that you're going to do a big deal with and what it takes as that deal evolves and

as the communications go out. How do you maintain a relationship when so much is a lot? How do you maintain a relationship when so much is on the line. It's always better to build a relationship before the big deal so that the big deal becomes easier because you've already built the trust. It's sort of like dealing with a time of crisis. I think when COVID came along,

if you had great trust with your employee base and they believed in you, then you could navigate through that a lot better than if your culture was good, you know, that was good. And so I think these relationships are really important. The CEO community in the United States,

honestly, is very tight. I remember when I became CEO, there was another, there was one of them at one of the first CEO events I went to, and he handed me a cell number and he said, listen, this is, these people in this room are the only people that know what you're getting ready to go through. And so you need to get to know and make sure you call and talk and ask us old guys, you know, when you get into it. So I think the CEO community is very close. I think, you know, some of the, some of the, the number of deals right now, I think in many cases, the public narrative about what's going on isn't

reflective of what's really happening behind the scenes because most CEOs are very pragmatic. There's not a lot of emotion. You're just sitting there. You're cutting out a deal. If somebody has a different opinion about it, you're not getting mad. You're trying to just get to the outcome. And I think that's the pragmatism and the calmness that most CEOs have. And I think that sometimes the press and others like to create the drama because that's what people click on. Yeah, if anyone sticks a bunch of microphones in your face. Be careful. We move away quickly. It just happened, by the way.

Yeah, we got you. We got to get the flash effects out here. Yeah, yeah, we're the operandi. If we flip it around, give us some advice for the youngest cohort of folks who will be joining Cisco. What does it take to succeed? What's your advice for people that are going into a major trace? The people that want to take your job one day. Yeah, maybe, maybe.

Come on, hurry up. You know, I think the people who are wildly successful have this really incredible combination of, in our industry, understand the technology, have high EQ, really care about the mission of the team, don't, and understand that if the team success, anybody who says I don't care about my own success is lying to you. But the person who figures out that when the team succeeds, I'm going to succeed, so it's easy for me to focus on the team. And then you also have to have people who care about making sure their peers are successful

as well. it's, you know, the person who's solely focused on getting to the top as an individual, it's not going to happen. And that, so it's a combination of those technical skills. And the high EQ, you cannot, I can't underestimate. Yeah. You talked, you talked about, you've talked in the past about effectively doing, doing the job that you want already and as a way to kind of like work your way up the ranks.

Leadership before promotion. You guys actually do your research, don't you? I just, I tell people that, you know, if your peer group would look at your promotion announcement and just go, that makes perfect sense, then you've done your job, right? And if you can't look in the mirror and say, okay, those people, would they be happy and would they believe it was the right decision? And if they wouldn't, then you're probably not quite where you ought to be. And I think that, you know, I tell everybody, too, you're, my team hates when I say this, but I'm going to say it anyway. I think when we have two or three internal candidates for a promotion, the whole interview process is stupid to me. It's like we've been watching these people work for a decade.

What are we going to learn about them when we sit down in a room for 30 minutes and ask them questions? When we watch them work, can't we just look at the three of them? And I translate that to every day you're working is your interview for your next job. Your work every day should be your interview for the next promotion. And now, if you've got external candidates, certainly you have to get to know them and learn all those things. But when it comes down to two internal candidates, I just say, why are we doing this? But we do it anyway. What's keeping you up at night?

There's a number of nothing. No. Yeah, how do you, how do you handle, how do you, how did you learn to handle stress? Because over the last few years you had COVID, we've had so many different geopolitical tension, trade wars, all these things. What's your, what's your, you seem unfazed? I have, I've always been able to compartmentalize things and I have always, it's innate. I did not teach myself this. I've always been able to just put aside things I can't control.

You plan for them, you do, you come up with different scenario plans, but I mean, I'm not going to lay it awake at night and worry about something that might happen that I have no control over. That's a good mantra. And, you know, there's, look, I'm going home when I've had a really bad day, and I've looked at my wife, and I say, you want to hear the good news? And I said, I wasn't diagnosed with cancer today. And somebody was, and I wasn't.

So my worst day, if I'm not being diagnosed with cancer or some sort of terminal illness, tomorrow I'll get them fight another fight, you know, fight another fight. And you just got to have perspective. I love it. Well, thank you so much for coming in the show. Thank you. Great to see you guys. Nice to meet you guys.

Keep doing it. You guys have got a real good product. Thank you. Thank you. We appreciate it. Before we bring in our next guest, let me tell you about Plaid. Plad powers the apps you use to spend, save, borrow, and invest, securely connecting bank accounts to move money, fight fraud, and improve lending, now with AI.

And up next, what a legend. What a legend. Without further ado, we have G2 Patel. Cisco's president and chief product officer. Welcome to the show. Look at this fit. Look in charge. You got to cover more of yourself up and you don't look as good now.

Well, thank you so much for taking the time. Thank you, how is the Cisco A-Sahomac going? Are you happy? How are you feeling? I am thrilled. You know, the thing is, I think we are. at a juncture right now where these conversations with a range of topics with the ecosystem are actually far more important than any individual company, talking about a product that

they're trying to, you know, pedal. And I feel like we are, the realization is now pretty obvious to everyone that this is an ecosystem play. Like no company, us included, is going to be able to actually get the full stack built I mean, a couple of years ago, people were saying that either, you know, like one AI company will completely dominate, where they have, like, multiple IPOs going out, XAI as part of SpaceX now, like, lots of companies are succeeding. And I think, like, this whole notion of a zero-sum mentality is, I just don't think it's healthy. It's never been true in tech.

It's never been true in tech, but it's actually more false now than ever before. Totally. Because the complexity is so high, and the breadth is so high, and the scale is so fast, that if you just get arrogant thinking, you're going to do everything by yourself. You are guaranteed to be left behind. Okay. Well, first time on the show, let's back up, introduce yourself. And I'd love to know a little bit of, you know, Cisco's a large company.

Walk me through a little bit of the org chart that sits under you, where you work, who you're interfacing with, what projects you're working on. So I've been here for about five and a half years. Yeah. And I joined here. Good night success. Congratulations. We're very happy about that. We have a soundboard, by the way.

I know. I watch your show, so it's great. Some people don't know that we bring it with us. It's still a surprise. It surprises you when it actually happens because you don't expect it. But been here for five and a half years. I joined from Box. And I was Chief Product Officer there. Prior to that, I was at EMC.

Prior to that, I ran my own business for like 17 years in Chicago. And so I went the other way where I actually started really small. And then I actually got the itch for scale. I'm like, I really want to learn scale. Okay. And that's what got me to the Valley. That's what got me to these large-scale organizations. And the reason I'm really enamored with scale is the...

It takes a little longer to get there sometimes. Sure. But once it gets there, like, there's a movement that gets created. Yeah. So talk about the, either the org structure or the product surface that you oversee, how you're explaining everything that Cisco does because it's such a large organization now. Yeah, we have a very broad portfolio. Yeah.

And so, you know, everything from our core business, which is networking, to then the very, you know, kind of close adjacency, which is security. Because security is now getting baked into the fabric of the network. So that's the services, software on top of that? Yes, but, you know, SaaS services and hardware. So we have a, we don't only play in a range of different businesses, but we also play with multiple different business models. We have a hardware business. Yeah. We have a professional software business.

We've got a SaaS business in each one of these areas. So networking, security, Splunk, which was a massive acquisition that we made. Collaboration, WebEx, Contact Center, all of those products. Basically, all products. What we did was we decided about a year and a half ago, and Chuck, who you just interviewed, you know, we were talking about this for five and a half years, which is we need, Cisco has to become much more of a platform rather than feel like a holding company. Sure.

Where you don't have each individual product that's kind of in its own silo, then you don't get the benefit of the breath of Cisco and the tailwind of Cisco. But our breath had become our liability. And so what we had to do is fundamentally kind of rethink how we're going to build our products. And it had to become a platform. Platform being that the marginal cost of ingestion goes down and there's a compounding value to every single kind of... Every time you build new functionality doesn't just help with the product that you're buying,

but also helps with every product you've purchased in the past. And can other people add value to the platform that you've built? So that's the core definition. So that's what we started doing. And we consolidated all products together about 18 months ago. And I think it's been fantastic so far. There's a spring in the step in the employees. I think we are starting to see a fair amount of innovation.

We've actually innovated more in the past 18 months than the previous decade combined. And I think it will dwarf in comparison to what we'll do in the next 12 to 18. That's awesome. Yeah, talk more about Splunk and how that fits in specifically to the amount of data that's being created. in the AI era, it feels like a very fortuitous acquisition, but what's the response been on the graph? We were lucky on the Splunk side because it's very hard to find a company that is at scale with the right cultural fit, with the right technology adjacency, where the combination actually creates a one plus one equals 11. And I think Splunk happened to be one of those. There aren't

that many of those. Like a lot of times people will ask me, like, what's the next big acquisition? I'm like, if I found one, I would be shy to the balance chief, but there's just not that many that are out there. Either they're very frothy in the valuation, they're not, or they don't have a clear adjacency. We don't have the right go-to-market. We don't have the right cultural fit. There's a bunch of things that have to fit just right.

And so that was very lucky with Splunk. And the thesis over there was, look, you have to assume that the attacker is already in the system. And what you're trying to prevent is lateral movement. And if you're trying to prevent lateral movement, security is a data game. And the more data you have and the more data that can be correlated, the better off you're going to be at compressing the time for investigation, doing better detections, and doing a much better job on the response of remediation. And that's basically what Splunk brings us.

And I think we've got a great leader now in Splunk as well, who came from Microsoft and DocuSign, who's doing a fantastic job, Kamal Hathi. And I feel like there's... We have probably hit 2% of the potential that we have in Spunk. That's awesome. How have you processed stage by stage the overall AI hype cycle? It sort of perfectly coincides with your time at Cisco. It also, Cisco actually has the scale to have visibility into reality.

It's like you're just looking across, like, you can just pull up a map and just see like, okay, what's actually happening? How are organizations adopting this, not just in tech, but across the entire economy? You know, I think there's, I feel like I've always lived by the six-part framework, which is like important in descending order, which is timing, market, team, product, brand distribution. If you don't have all six, you don't win, but you need to make sure that. The first one is timing and you don't control timing. Yeah, we were just talking about that with Chuck. It's like in, it's very easy to predict the future in some ways.

Like with the internet, you could predict. Yeah, you just like could be off. Are you off by five years? That's right. If you're off a plan by two years, you could be, like, it could be done. Like, you might not win the market. And by the way, there's a lot of great products in the market that actually hit the market at the wrong time and did never see light a day.

iPad wasn't the first kind of tablet to be built, but it was the one that actually hit the nail on the head on the timing. So I do feel like timing is a disproportionate contributor to success and you don't actually control timing. So that should tell you that the intellectual arrogance that people carry with themselves saying that this is me that made this happen has a a ton of luck to it. And so we just happen to be at the right time, at the right place,

building infrastructure for 40 years, which is now a scarce commodity. And if you think about GPUs, these GPUs without being networked, don't really do you any good. And as the models get bigger, the networks actually need to get faster and need to get larger. And so what used to be something that sat on one GPU,

then sat on a server with eight GPUs that needed to get network, which then sat on a rack with multiple servers, then said, okay, I need to go scale out within a data center and have multiple clusters connected together. And now you're starting to see data centers getting connected together in this thing that they call scale across, where you have multiple data centers, depending on where the power is available,

hundreds of kilometers apart, that will actually operate as an ultra-cluster coherently for running a training run. And that requires a whole new set of technology and a whole new set of assumptions around physics that have to be challenged, which is what we've been doing, because we build our own silicon, we build our own systems,

we build our own software, we build our own kind of platform. So that's been exceptionally beneficial for us. And yes, I would love to say that we capitalized on the opportunity well, but the fact that there was such an intrinsic demand for large-scale data center build-outs is something that's just like we were lucky to be there the right place, at the right time, with the right products. Is cross-data center training particularly in demand right now?

I know Google's had some success. with it, other labs are probably thinking about it and working towards it. Is that something that's... It is, and it's actually, the reason it's important is because you might not find all the power to juice a single data center. And so you then have to make sure that you build a data center's where the power is available. And so once, if you have power grids in two separate locations, you then need to make sure that those get coherently connected.

And the problem with training runs is if you drop packets, then you have to restart the training run, which becomes extremely expensive. And so what you need to do then is say, okay, so I'm going to build in the silicon itself, technologies for deep buffering so that I can make sure that jitter and pack of loss doesn't really go out and affect the training run. And that's been a, you know, we just launched our P200 chip, what we call it with the 82-23 router, and that's actually going to be, it's already in a couple hyperscalers, but that's an area that I feel is going to have a ton of momentum.

Yeah. How is it being a fabless semiconductor company working with TSM? I know there's Silicon 1 which is a 5 nanometer process. Tim Cook was just talking on earnings about maybe some supply issues on the 3 nanometer process. There's always questions of like where bottlenecks emerge, even if they're very temporal. How is it going on scaling actual supply for you? So the good news is we've been added for a while. and we have a pretty broad portfolio.

And so volume-wise, we just shipped, like, I think it was last quarter, our millionth chip. And so we've got... So volume-wise, we've got enough kind of volume of... And I think in this market, scale really matters. And even though you might enjoy scale today, if you don't continue to keep growing the scale, you become subscale very fast. And so there's a level of healthy paranoia that you need to have about continuing to be operating at scale. And so that's been beneficial for us.

We have, of course, we work closely with the fabs and all of that to make sure that we get our fair share of, you know, kind of capacity. But it's also important in the sense that the data center buildouts that are happening require this. And the thing that's been really beneficial for us is we happen to be the offset so that there's not a level of pricing power that our competitor sometimes face it. If you just had one of our competitors providing the network A6 and everyone else is just building systems around the network A6, then you'd actually have a challenge. So what hyperscalers want to do is make sure that they can offset that by having choices. And so we provide choice to the market. And that's been, I mean, we, as you saw last year, we, we had, I'd know if we said we'll do about a billion dollars in orders in hypers. Get ready. How much did you do?

north of two. And then this year in Q1, which was, you know, last quarter, we did, like, I think it was north of a billion three or so in just the first quarter. So, like, you could start to see that there's a fair amount of momentum. Yeah. But you have to stay paranoid, keep your head down, keep innovating. What's your pitch to talent that you know as elite that you're trying to, you know, We're in the midst of last year.

I felt like you'd sum up the years, like, really intense talent war. There's so many companies with so much hype. And I feel like Cisco's approach is like let the metrics sort of speak for themselves, not as hype driven as other parts of, you know, the press release economy, let's say. But if you're sitting down with somebody and you have three minutes to get them to join Cisco versus, you know, another company or a lab or something like that, What's your pitch? My pitch typically is we're very mission-driven,

and so we want to make sure that we're building critical infrastructure for the AI era for the world, and that's a mission that you should, they have to feel intrinsically connected to and excited about. And it's not just about creating connectivity in that infrastructure, but also keeping it safe and secure. And then just continuing to keep build the entire full stack. I mean, we build a silicon, we build the systems,

we build the operating system, we build the platform, we build the applications, so we've got that full stack. And so if you wanted to develop and grow in a company, and we're very well known to actually get people who don't have experience in a certain area to put them into... I mean, look at me. I didn't know much about networking when I first came on. Sure.

And I think it's... I feel like experience is great in certain areas, but sometimes it can actually create a burden of bias for you. And so having a mixture of experience with inexperience so that you are having the inexperienced person, allow the person with the experience to unlearn as fast is really important. And the appeal to people coming in is, look, we're going to build things which are going to be based on the long term.

And if you want to learn how to have good, strong leadership foundation principles, Cisco is a great place to be for the long term. But I'm not, if someone asks me, like, you know, what do you have for your lunch? She's a free lunch. I'm asking the question, this is the wrong place for it. Like, we're pretty scrappy when it comes to that kind of stuff.

And we're proudly scrappy about that stuff. What about specific skills that are the most in demand? I mean, there's a lot of roles that are augmented by AI now. Well, we've heard, we've heard, too, about, you know, plumbers and electricians flying around and, you know, they are in demand. But even sales guys and chip designers, that's not going away anytime soon.

No, I think, look, the roles that have been in demand around enterprise, let's look at the entire business. If you look at enterprise sales, that's always going to be in demand. We're always going to need people in front of customers to say, hey, we need to make sure that we can get you the technology. And the distribution is a massive kind of advantage that we have. But on the chip side, there's there is not enough people that understand how to etch sand into creating a lot. intelligence. We need more of those. And so there's always a shortage of that. There's a shortage in people that are building hardware and systems. There's a shortage in people that are building software. So I don't feel like there's a lack of shortage in any of the areas,

but what's now happened is you've added to that an entirely different development model where you also need researchers for AI. And so we have an AI research team. And that's something that we historically didn't need in the product development cycle. And we've only been doing that for now for a few years. In addition to the research team, you need to make sure that software development life cycle itself is changing. We just announced,

or not announced, but we just kind of revealed with Sam that 100% of our AI defense product, which is the product that we announced last year at this event, is now going to be written by AI in three weeks. 100%. Like, no humans writing code. Humans are reviewing, which means that the bottleneck is no longer writing code.

It's actually reviewing code. You know, and those will require kind of shifts in mental models. And so it's less just about the shortage of what kind of skills do we have. I actually pay less attention to skills and I pay much more attention to attitude. And, you know, you can't teach hunger. And so you have to make sure that you find people that are hungry, intrinsically hungry. I don't believe in hiring people that you have to motivate all the time. Come intrinsically motivated, come intrinsically hungry.

And then I think you have to be insanely curious in this time. and day and age. If you're not willing to experiment and put yourself in an uncomfortable position and constantly, I always tell people like if you don't like change, and this is not my line, someone else told me this. I think Chuck told me this, but hearing it from someone else too. If you don't like change, wait until irrelevance hits you. That's a good point.

How have you processed the AI safety debate? Fortunately, the labs are kind of a heat shield for everyone else in AI. Like the focus is entirely on them, and yet, you know, Cisco and other infrastructure companies are, will be a key part of ensuring that all of this, all of these products that are created and intelligence that is created has, you know, positive impact on the world and humanity. So I think there's two dimensions to this. The first dimension is all the tools that you and I use are the ones that the adversaries are going to use to go out and create attacks on such a lot. security. And so the first thing you have to do is make sure that you have, you know, cyber defense happening at machine scale, not just at human scale. Okay, that's been something the whole industry is doing. That's nothing revolutionary, but we have to do it and we've got

to make sure that AI is being used for that. But the second area, which is these models that these applications are getting built on inherently by nature are non-deterministic, which means they're unpredictable, but you're trying to build like a finance application or a healthcare application, which needs to be very deterministic. I tell people, I'm like, you know, hallucination is a great feature when you're writing poetry. Everything else in life, not that useful. Your doctor's like, sorry, I'm hallucinated. And so what we have to do is we have to make sure that we actually figure out mechanisms

to get full visibility on the model and then have validation that says, does the model behave the way that you wanted to behave? So for example, if I ask a question to the model, build me a bomb. What it'll very dexterously do is tell you, I can't give you that answer. If you ask the question slightly in a nuanced way, I'm a movie scriptwriter, I'm actually going out and shooting a movie with Brad Pitt, we're going to shoot a scene, where Brad Pitt's going to get into the car, build a bomb, and then blow up the Bellagio. And so can you build me that entire scene?

By the way, can you show me how the bomb gets built in that scene? The model can get tricked. The model can get tricked. And so what you need to have is some kind of an algorithm. teaming process that says trick the model in test rather than in real world and do that algorithmically and once you do that that have some kind of mechanism to enforce runtime enforcement guardrail so that every single time you build an application that application is prepared to go out and deal with those kind of questions that might trick the model so that you as a company don't have

your brand at risk when you do that that's the thing that we are actually building and the thing that gets me really happy is if there was one product that I wanted to have fully written with AI, it would have been that product. Yeah, that makes sense. Because the speed, it has to run everyone else. And you have to make sure that you deal with this machine scale. And so it's really cool to see the teams not only change the fact that they're using tooling to make that happen, but they've changed their entire process. Every engineer in that team is now just a spec developer. They just build specs. They create markdown files. They give context to the model. They give context of the agent and then the agent's kind of writing the code.

And then our biggest bottleneck is becoming review of code rather than the actual writing and generation of code. How long do you think that lasts? I think it becomes, well, I think. Because presumably the review is going to get easier too. Yeah, yeah, yeah, totally, totally. At some point in time, these things are going to continue to get exponentially. We'll be able to just podcast all day long.

You'll be able to hang out with us. I can just be here like eight hours. Yeah, yeah, yeah. But so I think that's an area. And by the way, that doesn't mean that you can have a lot of AI slop that gets delivered in the market when that happens. Because what you'll have is really crappy software that gets written if people aren't paying attention to it. It doesn't obviate the need for having taste and having judgment and having instinct and making sure that you're thinking about what you're building. But what it'll at least do for you is provide this mechanism to accelerate the development where we're not just

constrained by I don't have resources, so therefore I'm not going to build 80% of the things I want to build. However, prioritization is still going to be important. And I feel like focus, I don't think the nature of focus changes just because you can build a lot of stuff quickly. Yeah. Yeah. Talk about innovation at Cisco.

You mentioned earlier, but I was watching a video from Jane Street all about innovation not necessarily being perfectly correlated. with new company formation. Like what startups do is great, but you look at the iPhone that came from Apple, you look at the transformer paper came from Google. Two wildly different approaches to innovation, one CEO leading, the other, this labs,

the Skunk Works team, how do you see innovation balancing between sort of top down mandate for new products, what the markets respond to, customer driven, versus lab scientists going off and working in isolation? It's a great question. So first thing is, innovation is, in my mind, it's a choice. So when companies say, well, we're big so we can't innovate. There's a lot of big companies that don't innovate, but there are a bunch that do.

So what's the separation? Correlation does not equate causality in that case. Just because you're a big company does not mean you can't innovate. In fact, some of the greatest companies are innovating at a really, really fast base. And by the way, scale really matters right now. In the AI, scale is actually a huge accelerant for innovation. Yeah. Distribution, more data, flywheel. Yeah, absolutely.

All of that. And so I do feel like innovation is a choice, and I think it's an intellectually lazy argument to say that innovation can't happen because we are too large. However, size does bring about some level of, you know, slowness in the process. And you have to be diligent about making sure that you're intolerant on bureaucracy seeping in, or more importantly, indecision sleeping. in an apathy seeping in where people just give up after a while. You know what?

I tried a couple of times. It didn't work. And it's like, no, you have to be comfortable with conflict. You have to be comfortable with making sure that you speak truth to power. And if that means that you're going to, like one thing that can become a failure state is in these large companies, you know, you get overly concerned about feelings of people. And so as a result, what you stop doing is you stop having the debates that need to be had. What you need to do instead is establish trust first in teams. And once you have trust, you know that the intent is not to put you down.

The intent is to make sure that you get the best idea ship out and get to win. And winning requires contrarian viewpoints that are actually actively debated. And sometimes hurting feelings. Exactly. But it wouldn't hurt feelings if everyone were clear about the fact that I trust this person, and they're debating the idea not the person. They're not attacking my personality. And so one of my mentors always told me,

you know, and I have not mastered this. You know, state the facts, but watch your tone. When I tend to do poorly is when I get passionate when I don't watch my tone. Because then that debate feels like it's a personal conflict rather than something that's about the idea. And so if I were to say, you know, on the innovation side, top-down bottoms,

up, I think there are certain things you have to go top down. Like, we had a decision we had to make that said, we're pivoting to AI first as a company. And that was not a decision I could have had democratically kind of source from 30,000 engineers. It would have not worked. So we said, we're going to go from top down on that. But I should be losing 99% of the debates in my organization because the person in the front line is spending 14 hours a day on that problem.

I'm spending six minutes a week on that problem. Chances are, even if I'm infinitely smarter, which I'm not, if I'm doing the right job because I'm hiring people smarter than me, at that point, you need to make sure that that person is able to have more facts, more thought put into that argument than me. So I always tell people, if I'm having a debate with you, if I'm having an argument, and if I don't lose 95% of the arguments, then we've got a different problem. Yeah, yeah, not a good sign. Because you just haven't thought through. But what my job is to make sure that the second level and third level thinking is actually well.

thought through on your end. And then we need to make sure that we have certain core principles up top that go from top down and certain core value systems that we should not compromise on so that we don't actually get people on an infinite loop. And then from the bottom up,

allow people to innovate and then let those great ideas percolate up. Well, thank you so much. Amazing. Thanks a great to meet you. Hopefully we'll have you back soon. I love that. And in the meantime, I'll tell you about cognition. They're the makers of Devin, the AI software engineer. Crush your backlog with your personal AI engineering team.

And our next guest is coming in right now. Fantastic. I wasn't sure if we were going to have a little bit of a break. But we have Costa. Welcome to the show. Welcome to the show. Hey, doing. Nice to meet you guys.

Thank you so much. All right. Sorry. No, no, we're good. We go for three hours every day. It's no problem. Please introduce yourself since the first time on your show. Yeah, so I'm Costa Claudiano.

I'm the EPP of technology for the San Francisco 49ers and Levi Stadium. And a big fan of the show, so excited to be here. Yeah, explain to us what that means and what your day-to-day is like and what the choices you're facing. So there's never like a regular day-to-day. So my team were responsible for everything from, you know, getting into the stadium, the ticketing systems, the point-of-sale systems for food and beverage, the Wi-Fi, the network infrastructure, the cybersecurity of the stadium, making sure that. that on game day we're like the referees, you don't notice us,

and you just have a great time and cheer on the team, which is hopefully the 49ers. Yeah, how is technology in a football stadium evolved? Like, we were going back to like the first broadcast was the Los Angeles Rams before they moved to St. Louis, then they went back, and it made sense because Hollywood is in there. They're very forward thinking, but how much have you seen an evolution in the technology that goes into broadcasting football game?

Well, it's crazy, I've been doing this for about 25 years now, and in a bunch of different sports. And it just used to be, you know, you go to the game, you watch the game, eat your food, and you go home. Now it's different because you have to have a technology experience. The reason why is, I mean, staying at home sounds like a good proposition. You have your big TV, your coach, you have your food.

So we want to make a reason to come to apart. We want to enhance that experience. So how can we get it to be kind of a social experience? How can we get something that will get you off your couch and coming there and having a great time? Because, I mean, it's also not cheap to come to a game. You know, it's a significant. a dollar value from your wallet and an entertainment dollar.

So we want to make sure that you have the best experience possible. And then, I mean, you look at the people watching sports. What are we doing now? We're all on our phones. You know, we're all on our technology. We all want more data. So it's like it's not trying to get people off their phones. It's like how do we engage our stats, more plays, no more things about their favorite

players and really bring the action to you. And then, I mean, with us being kind of an influencer economy, everybody wants to show off where they are, right? So we're like, what a better place to show off where you are and having a good time there. And then your friends are going to be jealous and then come and enjoy the game as well, right? Rank the most, like, rank your tech stack based on importance on game day, like, specifically during the game. And I want this in the world. Internet at the top.

No, no, no, no. But I'm talking about, like, when, like, if you're just an observer and you're enjoying the game and you're experiencing, you know, a bunch of different sets of technology, like, what are, what is, like, the average person not noticing that is, like, going on in the background that, like, you're fixing. Yeah, so I mean, hopefully they're not noticing it because that means it's working, right? So I think you start from the foundation, the infrastructure, the network, the network infrastructure, and, you know, I tell everyone they're like, what is that? I'm like, that's the plumbing of our organization. That's where everything flows, that's to make sure without that, we have absolutely nothing. We're cooked.

So, I mean, you know, Cisco is a great partner of ours and we work together. It helps that we're in Silicon Valley, which it helps, but also hurts because everyone knows technology in there, right? So everyone coming to the game, they expect the best, which is a great challenge. And one of the reasons why I went there. So that infrastructure has to be solid to deliver your Wi-Fi. And there's just the more and more need for it, right? We have to keep scaling it up now with AI coming down the pipe. Everyone's, you know, looking up their LLMs and on their phones, obviously sharing their experience

and, you know, with advanced stats and things like that, it has to be a frictionless for them, right? And so that network infrastructure has to be solid. Not only what's going on in the stands is the fans, but on the field, too, we can't have, you know, scoreboards go down. We can't have a coach comms go down. So we work together with the NFL to do that. So that's incredibly important to us. And then with that hand in hand is actually our cybersecurity posture. I mean, we can have the best systems in the world, but, you know, one hack, you know, one cybersecurity incident.

And it's a massive problem. Is that mostly like DDoS just like adversely? serial hackers just trying to like take you offline, screw things up, create economic damages? Or is it specifically like break in and steal credentials, everything, all of the above? I imagine every day there's somebody that would love to like broadcast onto the Jumbotron. Yeah, like this crypto scam or something. I don't know. What's the shape of the threat?

There is so many different threats. Like, I mean, you just name Fuse and you're scratching the surface. Just because we're so visible, you know, every Sunday, the world's looking at us. And, you know, it's a visible attack vector. So, I mean, we have an incredible cybersecurity team. We work again with the NFL. And then, you know, share knowledge with other teams because, you know, we're competitors on the field, but colleagues off the field.

And so we work together to make sure that we're mitigating risk. And, you know, it's not if you're attacked. It's when you're attacked. So we try and make sure to stop that. So you have to be proactive instead of reactive. If we're reactive, we've already lost the battle. Yeah. Is NAB important for you?

NAB? Yeah, the national. The show? Yeah, the show. Like we go for the camera stuff here. We try and learn. It's a great show. Yeah,

we do send a big team down there. But I'm wondering if that's, like, important to you or if there's a different conference that you're meeting more people and talking to more suppliers. No, we do send a lot of people to NAPE, our engineering team. I mean, it's definitely important to us because look at our broadcast size. We have right now, I believe, the largest outdoor 4K video screens in the league. So we do send a lot of people there. I mean, you want to be around the best in the race. We have a lot of shows that we go to.

But it's not only you don't want to stay inside the industry. I always say you learn your best when you're looking outside So who's doing what great doesn't have to be from sports and take that and what is what what is like the top down Mandate or standards that are shared from the NFL like there's obviously broadcast standards if you're delivering to ESPN or ABC or NBC But what what does need to be standard across the NFL broadly? Yeah, I mean the NFL has their their standards across the NFL Sure. Sure. You know Wi-Fi infrastructure connectivity expectations. Yeah, expectations. Every team has to be.

Exactly. But, you know, us at the 49ers, you know, our team always overperforms on the field. You know, we're always expected to win a championship. You know, that's what we try and do. I mean, it's difficult, but that's like our goal. So, you know, with me and the technology team, you know, we're trying to be the best. Again, we're in Silicon Valley. So we expect more.

So I want to go over and above and deliver an experience that's not just kind of the minimum. It's an experience we're going to come there and say, wow, Levi's Stadium's unbelievable. Like, this is insane. Let's go there. This is something different that maybe somebody like a Disney should copy, right? Or Starbucks or somebody else in the industry, sorry if they're not sponsors. How much different is the Super Bowl specifically? Is there more demands on your organization for a bigger event?

Or is it sort of the same as any other game? Yeah, I mean, the Super Bowl is one of the world's largest, arguably the world's largest sporting event, especially in this country. And the demands are greater. And we work again hand in hand with the NFL as their event. the capacity, the Wi-Fi, the bandwidth. It always sets records wherever they go. I mean, the previous record at our stadium was Taylor Swift,

which was an incredible concert, by the way. And, I mean, her demographic is super text-abby. As soon as she came out on stage, people are, you know, putting up their phones and sharing that, and it blew away our bandwidth records a couple years ago, and we expect this to go even higher. But that's a record that's always made to be broken because people are using more data, not less, right?

So we always have to prepare and scale up as well. Well, Jordy, anything else? I mean, I have a lot more questions, but it's great having me on the show. Yeah, thanks so much for us. Thanks, nice. All right to meet you. Thanks, nice. Oh, you hop so.

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support, giving employees instant resolution for access requests and password resets. Tell me to see you. Good to see it. Good to have you. Data centers in space, what you got? Coming in hot. Me, you, the international space station. Let's break it down. You know, the space tourism industry is quite a, quite a fun one, right? Yeah. Would you go? Would you do the Blue Origin thing? they blast you out past the Carmen line? It's good enough for Katie Perry. It's not a good enough for you?

What's going on? It's like, you know, like you're in free fall. You're not actually in space. Oh, it doesn't count. Shouts fired. I want to be like going around for days. Oh, okay. I want my bone density to start to atrophy, right?

I truly want to feel the negative effects of space. Yeah, yeah. It's not enough just to go home back. I think I would do it. It's like 90 seconds, right? Yeah, but it's better than being hanging out on early. But like all the cool stuff that astronauts do, right? Like, you know, put water and then,

like they're bubbling and then you like try and drink the water. They'll be unplugging the GPU and plugging it back. Oh yeah, yeah, yeah. That's what you pay for your space tourism. You've got to go on the seat of ship. 90 seconds of servicing. Yeah, one 90 second trip at a time. No, but people were wondering, you know,

TPUs and video going on the Starlink V5 or whatever, whatever something gets up there, it feels like this will be something more like a Tesla silicon. chip and AI chip? Do you have any insight into like what the process, if you wind up figuring out how heat dissipate, if you wind up figuring out the costs, what might the chip look like?

So I think, I think, you know, everyone freaks out, oh my God, putting stuff in space is expensive. Yeah. But if you look at like starship launch costs and they keep falling, you're like fine, right? Like I think that's not, you know, by the end of the decade, the cost of space launch will be fine. The heat dissipation, I mean, it's a challenge,

but you just put a massive, massive, effectively radiator. Yeah. And it's fine, right? By the end of the decade, like, you'll be good. I think the big challenge is that chips are just really unreliable, right? And so how do you deal with, like, a couple of things, right? Satellites can only be so large before they, like, you start needing a lot of support and structure before they tear themselves apart.

So when you look at, like, the launches, right, these things are shooting out, like, tiny satellites. And many of them. Okay, so you can't have, like, a big, fully connected cluster of chips. And then, like, on top of that, right, how do you deal with any, random error. On earth, you have text running around the data center, unplugging stuff, putting in spares, things like that. What do you do in space? You RMA it to the factory where they might unsodder it and re-sodder it and then test it and it works and go back out. Sometimes it is just trashed. But like, that's the challenge to me. Is that, I feel like maybe the pattern

we should be looking at is like, how often do the Tesla self-driving chips need to get serviced? Because that's like the team that would probably be building or like bridging the gap there. Like the Starlink satellites, sir, they go down, but like the service works. Like you're you're just relying on some sort of like, you know, 90% uptime stuff's coming down. But most people that are in a way, mo, like the chip keeps working, right? Most people that are in a Tesla self-driving, like they're not, like you don't hear about Tesla owners being like, I love FSD, but I'm constantly in the shop getting my custom silicon ships unseated and reseeded, right? Well, I mean, it's also a function of like the complexity of a chip, right?

Sure. You know, if a chip is twice as fast and let's say the bit error rate, right, right, like how often a bit flips is the same, then it's erroring out twice as often. But let's say the chip is 10x as big, right? And so when you look at like a Tesla FSD chip, very, very good, very, very efficient, still like relatively inexpensive and cheap compared to, you know, a big old GPU or TPU or whatever. Right? Those things are extremely large.

And, you know, again, like, if the error rates are the same, then it fails 10x more, but in fact, the error rates are a bit harder, higher because they're pushing these things to the absolute limit. Whereas, you know, Tesla does have some level of like, well, first of all, the Tesla car has two chips, sort of redundancy already built in, right? Maybe you do that on the satellite, but that's more power, more... Yeah, right? So the whole all lure, right, of it is, you know, effectively power is free, right? And solar panels, you look at the cost curve of solar panels,

We'll get the cost curve of satellite launches. You're like, this is free, this is great. But power is less than 10% of the cost of the cluster. Sure. Right? So, like, it's that 90% you're not saving anything on. Yeah, yeah. And insofar as much as...

For potentially 100 times the hassle. Yes, yes. There's this whole, like, you know, like, if you look at Nvidia GPs, right? When you first turn on the cluster, about 10 to 15% of them fail RMA in the first two weeks. Wow. And then that's fine. You have to receipt them, whatever. And like the industry knows how to deal with this, right?

And over time, like, Hopper's now at 5%. But Blackwell's still 10 to 15%. Wow. Actually started out higher than that. Sure. And when a new generation comes out, it's going to be higher than 10, 15%. It'll have its curve gradually declined down. But, you know, who's going to, are you going to test it and burn it in on the ground?

Or are you going to say 5% of my chips or 10, 15% of my chips are trashed? Because someone can't go up there and, like, do these things. Or am I saying, oh, I need robots who can do all this stuff in space? and now that's like an additional engineering problem, when sacks of meat are actually very cheap. Yeah. Speaking of Nvidia, we haven't talked since the GROC acquisition. What does that look like in the bulk case?

Like if it's a good, if the next version of GROC is a great chip, is it sitting next to the, you know, H-200, H-100s in the rack, GB-200, like how does it fit into the actual, like what Nvidia deploys? Is it just a separate chip to sell aside? I think it's a big vibe shift from Nvidia, right? Before they were like, all right, I got this big GPU. Everyone's going to use this GPU. Software ecosystem of the GPU is so good.

It's one size fits all. Everyone's trying to make all these specific point solutions, but we've got the thing that's good at everything. And then they had a vibe shift, right? They launched this thing called CPX, which is a chip made for pre-fill, prompt processing, creating a KV cache, and also good at video generation and image generation. And that's coming out later this year.

They were really talking about video generation as well. So yeah, you've got like CPX, you've got like the standard GPU, and now you've got the GROC chips, and they all fill a different niche. But really it screams, oh crap, we don't really know exactly where AI is going, which I don't think anyone does, right? I mean, it's moving so fast the software is, the model architectures, et cetera. So we're just going to like engineer solutions that are along multiple points of the parado optimal curve, and then, you know, one of them will win, right? And I think it's like sort of like a big vibe shift from Nvidia. Also, they just knew opening I was going to do the service deal, so they freaked out. Got it.

Yeah. Yeah, get me up to speed on what makes Cerebrus important in the ecosystem right now. So, you know, you have people thinking like, oh, latency matters in terms of where our data center is. It doesn't matter at all. What matters is, you know, as we've moved from, you know, chat applications, which we're like, or search response immediately,

chat applications, let's say response takes 10, 20, 30 seconds. You've got agents, you know, I don't know, my cloud codes are working in the background for a long time, right? It doesn't matter where the data center is, but what does matter is that these streams of inference take, you know, 30 minutes versus 10 minutes versus five minutes. And for a lot of people, I'm fine to spend 10x the price. Sure.

On something that completes 10x faster. Yeah. And so Cerebrus sort of just makes a ton of sense there. So Open AI, you know, they've got these like long horizon. There's like Codex 5.2 extra high thinking or whatever. It's terrible. Can you guys teach them how to market? Open it out.

You have to sponsor this podcast. Yeah, yeah. We had two much yesterday, and I did actually ask him, like, I had the Codex app pulled up on my desktop, and I was like, there are six different models, and then there's another button that I can pick to me. Well, how many different products are called Codex now? There's a lot. And now there's an app, yeah. Yeah. We actually have another guy on just to do branding.

Lexicon branding came on the show yesterday talking about all the naming. Naming architectures. It is complicated, but hopefully. You could tell he's just blood's boiling because, like, all the AI companies. users have the most chaotic. Anthropic, Clod, Clod code, but also you can use Clod code for other stuff. Yeah. But yeah, I mean, with Cerrebus, it seems like there is a value to it, but are they constrained

on the supply side? Like, can they actually scale up to, you know, a colossus-style data center that could actually speed up codex not just for, like, one user, but all the users. So, I mean, Cerrebers can speed up multiple users for sure. Yeah. The question is sort of like, where you use it? and that's where they have to figure out where within codex, right? Because there are times where codex is running for like 10 hours.

And sometimes you don't mind, right? Like, screw it. I've put up this nice prompt, gone, work on it, refactor my code, do this thing, do this task. Other times I want this iteration feedback loop. So how do you expose it to the user without saying, hey, actually, there's another toggle. So your permutation is 18 times. Well, hopefully a really robust model router, but it feels like that's been a process. Yeah.

So the opening ideal is like for 750 megawatts. It's not that much capacity on the order of like what OpenA has talked about. You know, by the end of 28, they'll be at like 16 gigawatts. Sure. Of that. So it's just like the absolute cutting edge, the most price insensitive customers in that specific use case of this is the type of prompt that you need to return fast, then you'll get the speed up potentially.

Right, right. And they've got to figure out how to do it from a product, exposing it to the user, et cetera. But it's clearly something where there is demand, right? Like, I don't know, like Andre Carpathie doesn't care if you spending a thousand bucks per agent per second or whatever, right? Like, you know, so whoever it is, these like super cracked engineers don't care at all. And then obviously there's like a long tail of like actually cost does matter for most people. And so, so all along that curve, they've got to have solutions, right? Yeah. Yeah. When did you first think that XAI might end up at another Elon company?

I mean, this has been rumored for a long time, right? People are saying Tesla, Tesla, Tesla, for the longest time. It's harder with a public company. Yeah, yeah. And then a few, a bit ago, people are like, oh, SpaceX, I'm like, wait, this makes no sense. No, but there was a very coordinated, like, narrative pump. Oh, yeah. Like, at the end of last year, at the end of last year. No, it was, like, almost, like, perfectly telegraphed. Well, there's a bet, right, between basically the head of compute of XAI and the head of

anthropic, and the bet is what percentage of worldwide data center capacity is in space by the end of 28? And the bar is one percent. Oh, wow. And so the XAI guy is, like, really bullish. The anthropic guy's like, eh. Yeah, I'm a little slower. Yeah, yeah.

But it's a really interesting bet. I take the under on 1% by 28, because that's a gigawatt in space. Yeah. But it's actually not that crazy, right? Yeah. It's roughly 150 starship launches. We'll get them to a gigawatt in space.

Yeah. So, you know, Starship hasn't worked yet. Yeah. Fully. I was looking at the energy draw of the current Starling fleet. And I think they're at like, what is it, 200 kilowatts or something?

something like that. So you get a thousand of those, 200 megawatts, and like you're starting to be in the territory, something like that. Yeah, so the V2 stars satellites, I think, are the only ones they've launched. Maybe they've launched a few V3s, but the V3s are coming soon and those are like 100x more bandwidth each, right? And more power. And just more power. And so when I'm just thinking of like, can you scale this thing up at all? It's like are they two orders of magnitude off? Are they three orders of magnitude?

It feels like they're like one order of magnitude off being one one, something that looks like an H-100. I think the metric is like 50, it's either 50 kilowatts a ton or something like this per satellite for V3. Yeah. If, let's say from V3 to whatever the compute thing is, they double it again, get to 100. I think the V2s are like 25. Yeah, yeah, yeah. So if you get to 100 kilowatts per ton for launch, it's only 150 or so Starship launches. Yeah.

I think that's so reasonable. Maybe not 28. Maybe it takes 29, but like, you know, it's so reasonable. The question is cost and reliability and, you know, what happens when the chip fails? How do you service it? That kind of stuff. How do you deal with having clusters be much smaller instead of like these big clusters,

even for inference big clusters are useful? Yeah. Yeah. How do you think about Google's response to grox, RIS, TPUs, obviously very successful, but are they forking that project to eat more of the Pareto curve? Yeah.

So for the longest time, Google's had one main line of TPUs, right? All made by Broadcom. And then sort of next year they've diverged it, right? Where Broadcom makes a TPU and MediaTech makes a TPU. These two TPUs are focused at different things. And they're fabed at TSPM. Everything at the end of the day goes to RACUS, right?

I want to go there next, but everything goes to Iraqis. So Fab by TSMC regardless, but both of these TSP are focused on different things. And they've actually got a third project for another kind of TPU there. They also see this need to proliferate along the curve of like, hey, do I care a lot about super high amounts of flop, not much memory. Do I care a lot about super fast on-chip memory only? Do I care about 3D stacking memory? Do I care about, you know, this sort of general purpose middle ground AI chip, which is what, you know, an H-100, a Blackwell, a TPU looks like today. You know, they're sort of like, oh, we need to hit the entire Prado optimal curve. And it's like, okay,

within this, there's training versus inference differences and like what numerics you want and all these other things. There's so much complexity there. Everyone, everyone sort of is diverging their roadmaps. Once they're at a sufficient scale, I think. Yeah. Are is Google still way ahead on cross data center training? Yes. And are the other labs, like, is that important to the other labs to catch up there?

Or is it something that will just naturally happen because everything sort of commoditizes? Or do the other labs need to sort of marshal some herculean effort to, like, crack the code on what it takes and what Google is doing? Yeah. So it's a couple of things, right? In 2023, everyone thought that scaling was pre-training. Yeah. Right? you know, more parameters, more data.

And that's very difficult to split across data centers. And has Google been able to do that? And Google's been able to do that to an extent, right? So what they've done is they've got, you know, they don't have the largest individual data center campus, but what they do is they do these like regions where it's like, hey, each data center's roughly 40 miles apart from each other. So in Nebraska and Iowa and then in Ohio, they've got like these complexes

and now they're building one in Oklahoma, Texas, you know, these complexes where there's all these data centers pretty close to each other. So it's not really cross data center. across the world. It's just across like region. Yeah, and then that makes a lot of the difficulties a lot easier. Flipside is we've also moved to RL, right? And majority of the time of the chips is spent generating data, right?

Only doing forward passes through the model. And then you only send the final tokens that you verified sort of back to train on to the training, to train, right? So then you end up with like, oh, instead of in pre-training scaling, you need to like synchronize all the weights every 10, 20, whatever seconds. When you're doing these rollouts, and especially as things get more and more agentic in training, you might not only need to send not the entire weights, but just the tokens that are relevant, so way smaller amount of data and way less frequently, right? Minutes at a time instead of seconds at a time. And so you've got this like now it's become like reasonable where, oh actually multi-data center training is completely reasonable.

And people do this, people do multi-data center multi-chip training. Sure. Right? You know, you do your inference on one set of chips and you do your training on another set of chips. So like, Anthropic does this. I don't know if Google does this, but Google's kind of already got the cards, yeah. Okay, got it. Let's go to Iraqis.

Yeah, talk about Iraqis. There's this debate. TSM risk, is that the bottleneck or is energy the bottleneck? I was doing back of the envelope calculations. It seems like we're using maybe like 1% of global energy production or Western energy production on AI, specifically, workloads. And then we're using like 50% of leading edge fab capacity on AI workloads. And so that feels like, okay, well, even if we all agree, and as a society, we're going all in on AI, we can only double the AI chip capacity before we need to build more fabs.

That takes years. Whereas we could say, everyone turn off your air conditioning. We're sending the electricity to the data centers, right? Like, we have the ability to generate it. So we have created new. Clapting. Turning off the AC. Turn off your.

Quad needs to eat. Heat strokes for all the grandmothers. Yes, yes. I need my cat dancing videos. You need to feed Claude, right? But seriously, like there's this debate over, you know, is TSM the main bottleneck or energy the bottleneck? How are you feeling about that?

Yeah, yeah. So sidebar before I answer the question, because I think it's fun. You know, in the U.S. that's insane to say turn off your AC for AI. Yes. Right? And the general public hates AI already. Of course. But in Taiwan, they've had droughts before, and they've turned off water to entire cities.

They're like, oh, you get water three days of the week. And then the fab still gets supplied water. It's like, this is, you know, you've got to understand the mindset. We are not ready as weak Americans to do this. Yeah, that's great. No, but at the end of the day, right, like water and power are certainly less big of constraints. Now, now you've got to imagine, like, you know, semiconductor industries used to, hey, doubling the amount of transistors made every year or two. Part of that is more's law.

Part of that is more capacity. Whereas the energy industry in America wasn't. And so, like, initially people were like not creative. Like, let's do these kinds of gas plants. It's like, well, no, now we've realized, you know, yes, there's three main manufacturers of turbines, and then you've got for a dual combine cycle, then you've got like IGTs, but you've also got like medium speed reciprocating engines, right? Like, turns out Cummins can make like a million diesel engines a year, and like those can make

electricity. Like, if I don't give a fuck and I put it in West Texas, easy. So now it's more of like a regulation thing, a supply chain thing. Power is not a constraint in so far, like that much, right? I think it certainly is a constraint still today. It was the biggest constraint in 24-25, data center capacity power because the industry was not ready. People have woken up, they've sort of been shocked to the system.

Now you've got tens of gigawatts being deployed. Next to your 30 gigawatts are being added, and we think the power is there for it. What was it this year? This year is like, I think it's like 18-ish, 10-ish. 15 to 18-ish, sorry. So almost a doubling. Yeah, almost a doubling, yeah.

And when you look at, when you look at TSM and the crew, right, there is not really, oh, this random, you know, there's 12 people making medium speed reciprocating engines that you can now convert to make power at some random data center. No, no, no, there's like, there is a rackus, right? There's one set of spice, like, you know, there's, you know, that's it, right? And so, and then the flip side is like, okay, when you have 12 vendors, everyone's got a little bit of slack capacity, you know, there's more likelihood, you know, you can,

people are like, oh, turbines you can't get. you can call a broker and you can get a turbine. You might be paying 50% more, 2x more, but you can get a turbine. Yeah. Right? But you can't get a 3-9 meter fab. You cannot get a 3-9-a-fab, exactly. And so when you talk about what's the, you know, the baton got passed from

semiconductor shortages in 23 to power and data centers in 24-25. 26, we're still, we're swinging the pendulum, but it will fully beech semiconductors again in 27, right? And so we see this across the entire space of the ecosystem. It's not just TSM, it's also memory, both. Because both of them have built at a certain pace. Now, TSM's been expanding at some rate. The memory makers, in fact, have just not expanded capacity. Basically, they've not built new fabs since 2022.

Because they're cyclists, so undulating. Yeah. And so when you look at it, it's like, oh, even if they wanted to double capacity, they need to build the fabs. Yeah. Right. And building the fabs, it is the most complex building humans make, right? It's the entire air of a clean room circulates itself every 1.5 seconds.

What? And you don't even feel it when you're inside. Really? It's like that. And it's like parts per billion of particles, right? Like it's actually insane how you could get coughed in the face by someone who has COVID and not get COVID. And so it gets circulated so fast. It doesn't even hit you.

It's like that meme of like the spraying when someone's talking and then it's just, it's circulated. So another sidebar is everyone knows COVID. like really popped off in Wuhan. Yeah. Right? Wuhan also is home to China's largest memory company, YMTC. And so when they were like welding people into their homes, the people who worked in the fab still went to work. Wow.

It was because it's, you know, one, it's a national importance, but two, like, these people aren't getting sick. This fab is like way too clean. Yeah. Yeah. Sorry, Jordy. I want to talk about Oracle. They put out a post this morning that said, our partners financing for the done.

Indiana County, New Mexico, Shackleford, County, Texas, and Port Washington, Wisconsin Data Centers are secured at market standard rates, progressing through final syndication on schedule, and consistent with investment-grade deals. Obviously, they were fast following their posts from yesterday, where they said the NVIDI deal has zero impact on our financial relationship with Open AI. We remain highly confident in Open AI's ability to raise funds and meet its commitments. And obviously, everyone was looking at this being like, give me a cigarette. They're like smoking. It's like bank run language. I haven't seen posts. like this since like the FTX era where it's it's terrible comms yeah like like

uh i i i told my oracle context like like who the hell is in charge of the twitter like what are you doing um invidia did something similar last year when the whole tpu mania was going on yeah yeah it was it was it was like we're we're thrilled with google's progress with the tpu that said nvdivy chips are the only you know it's like no one asked you to comment yeah i mean like i'm I'm sure a handful of people in your DMs and random, but that doesn't mean... It doesn't project confidence. It's sort of the lion shouldn't concern themselves with the sheep. And like, okay, InVitya this line.

Maybe Oracle is a little bit more bumpy, but I think Oracle is like fine. People are just freaking out because, you know, Open AI is peak, you know, people are peak negative on Open AI right now because of how good Anthropics been killing it. Sure, sure, sure. Yeah, I think it's just like kind of silly. Like they need to hire someone to do comms like a Lulu or something, right? both Nvidia and Oracle, because what are you doing? How did you process yesterday in general, Jensen was clip farming?

He was like, I don't know why he does these street interviews, right? No other CEO does those, where they just stick 25 microphones in your face and the paparazzi's flashing. It's a great vibe. It's, you know, Jensen's not been as famous as other CEOs for as long, and yet he's so important now. And if you've like, if you know of Jensen, how he is in meetings, there's, I feel like there's two Jensen's, right? There is like PR, like good at PR, just good at talking, good at like making people hyped up and believe what he's doing. He's great at standing on stage, holding up the chip, delivering like a sermon. And then there's the real Jensen, which is like a business killer.

Yeah. And like actually just knows about every like aspect of the supply chain, right? All the way from like niche semiconductor, you know, design and manufacturing stuff all the way to like energy. Power Data Center, like, and then doing the business deals too, right? And so, like, you've got this whole paradeo, like, a whole thing, a whole range of things that he's good at and he's a killer in. And clearly he's like, he was in a meeting where he was being a killer and like negotiating, like supply contracts or something.

Oh, when he walks out. And then he walks out. That's hilarious. Yeah. This is my inference. But I like it. Yeah. Yeah.

And that's why he was like, you know, like, he was like still killer. Like, no, we never said we committed to $100 billion, you know, like. And it's like, I don't know. Where do you even get the $100 billion? billion number from. And it's like, well, you did go on CNBC and make a big deal out of it. And so I think people would assume that it was, but they did say in the press release, or remember, these are early talks.

But they just kind of jumped the gun. This was the height of the press release economy. Yeah, yeah. What's funny is Oracle stock peaked like just like a week after they announced the opening eye deal. And so like the press release of like, hey, open eyes is going to do this humongous deal. Stock peaks. Same happened with a couple other vendors. who announced deals with OpenAI or Invidia,

like sort of a lot of these, like, they all peaked to that, and then it's sort of been like, NVIDIA, Open AI trade has been going poorly and sort of like the TPU, Anthropic, Google, Amazon complex has been doing well. It's quite interesting that this happened. This would have been good energy back at home with the roommates. What's going on in?

I wanted to, yeah, I get one more thing. So, yes, over the weekend, it was, of drowned out by all the Justice Department stuff. Wait, have you guys talked about Elon saying you can smoke a cigar in the fab? No. Yeah, yeah, yeah. I was going to say this is part of the whole thing. I didn't realize that was related.

Yeah, that makes sense. Yeah. Indoor heaters. We have indoor heater technology. No one's taking advantage. Yeah, what does the fad look like if you have no humans inside? Like, that's probably his long-term thing is like, yeah, there will be an optimist. But no one, like, the number of people who work in a fab is, like, irrelevant.

But is it irrelevant because there's all these things you have to do when a human's in there because they sweat and they breathe? And if you don't have to do that because it's a robot walking down, even if it's puppeteered or teleoperated, you might be able to have different considerations. I don't know if that actually affects. Well, it's like a nesting of like cleanliness, right? For example, you've got this wafer you've put like down, let's say you put down copper. And now you're moving it from one area to another. Well, it needs to be stored in a vacuum, but the easiest way to store a vacuum or an inert gas. And that's like the thing that's being transported in.

But then around that, you want it to be super clean as well. If you don't, then the copper starts getting oxidized. It affects your yields. All this sort of stuff happens. And so, like, you kind of want it to be a nested layer of like, well, this thing inside the EVV tool is super clean. And then the thing feeding it is super clean. And then the thing it sits in is super clean. Because that's how you get to like there's zero particles.

Yeah, yeah, yeah. Because like, you know, in the foop and the transportation devices, like parts per trillion. And maybe poop. It's called F-O-U-P front-operated front opening. I don't know, something pod. But it's called a foop. It's like the thing that moves and it carries the wafer. Sure, sure, sure.

And then the fab is like parts for billion and, you know, sort of like, you know, you've got to like got this nesting relationship so everything is super clean. You know, I'm bullish on robots, like super bullish on robots, but only for like, not for tasks that have like TSMC's Arizona fabs. Or, okay, let's say TSMC, Tynon, which I think produces like, you know, indirectly hundreds of billions of dollars of global GDP. even directly, it's like still tens of billions of dollars, has like five, 10,000 people in it. Like, it's like irrelevant in terms of the number of people who work there.

In terms of the overall economic value that's created. Right. It's like, it's like, how many people fold laundry or how many people wash dishes or how many people like do construction work? Like, these are way bigger markets. For robotics, yeah. Yeah. Yeah. Speaking of China, what are you making of the, the, the, the, the Dario essay, or I guess his comments at Davos about, you know, selling chips to, China is equivalent to, you know, nuclear weapons these days. The Ben Thompson line was something like he's okay selling chips because he wants dependency

on the NVIDO ecosystem, Kuta, but he would ban lithography tools from going to China. And I'm always, I've been wrestling with this idea of like, I don't know if China would accept this, but wouldn't there be a different world where you want them dependent on American LLM APIs and you don't even send them the chips? And you say, yeah, you're, you can have as much AI as you want, as long as it's, you're paying, you know, Open AI and Anthropic API. Yeah, I think it's, I think it's like a curve of like, what they will accept.

It's, it's, you know, one, you, you, you push someone into the corner, they're going to start swinging, right? And I'm, like, very concerned that China does this, right? Do they, do you push them too far into the corner? Do they say, screw this? We're going to start being a lot more aggressive. We're going to, we're going to, you know, do more military actions. Or military actions.

Or even just invest twice as much in global, in supply chains, like takeover. Africa more than they already have, like, Latam, like, et cetera. There's, there's, or just take over Taiwan. Right? Because if I can't have the chips, what values there in Taiwan existing? Sure, sure, sure. In its current state, right? So there's this, like, there's this, like, game theory aspect. Yeah. At the same time, you don't want China to be able to, like, you know, if you believe

AI is going to be, do what I think many, at least in San Francisco think it's going to do, which is, like, completely revolutionized humanity and cause GDP growth to accelerate. Do you want to have China also own that technology? and their ability to integrate that into their military and all these other things much faster. So there is these competing like, you know, interests. Where is the like right line? And some people think it's like, hey, yeah, sell them AI model.

Well, I think Dario would say don't even sell them AI model access. Don't even sell them tokens. Yeah, I think so. I think Adthropic does not sell AI access to China. You know, they loop it through and you can see this in the traffic data. They go through Korea and Japan and other places. And so they get it. And then the other side is like sort of like, I think,

think the Ben Thompson view, which is like, and I think I'm more sympathetic to that, although I think I'm not exactly in line with that, which is like, and we've been saying, like, don't sell them equipment, don't sell them equipment, don't sell them equipment. And my argument is like more economic in the sense of like if you sell them like tens of billions of dollars of equipment, they can make hundreds of billions of dollars of AI value or chips with that equipment. Whereas if you sell them AI model access, then it costs them this much to get the economic, you know, they're not able to.

You're capturing more of the value. Exactly. And so that's sort of the question that is at foot here, right? Do you want them to capture all this value of the supply chain in equipment or by buying the chips or using the models, right, and services? And we've seen, you know, across many, you know, stacks, China refuses to accept, you know, using American ecosystem and they'll wait many years before they developed their own. Whether it was like, hey, they didn't use Windows, they figured out a bootlegging economy, or they didn't use Visa. And eventually they came out with like Ali Pay and WeChat Pay or whatever it's called on. And like these things are way better than Visa in fact, right?

Lower transaction cost and higher volume. I never use Red Star Linux. It's North Korea's Linux distribution. Wait, really? Yeah. If you don't, if you put it on a network, it'll immediately call home. So you have to put it on a firewall network or else it just like steals everything immediately. I'm a fan of Temple OS, you know?

Yeah, there you go. Is Doug O'Loughlin suffering from a case of Claude Psychosis? Okay, yes, yes. So I think everyone's like, Claude code is for coders. And it's like, no. Claude code is for people who don't code now. Yes. Right?

And that's the big realization this year. You know, we've got a couple folks now in the firm who have psychosis. But Douglas O'Loughlin, who is like, you know, semi-analysis, number two, he's president. You know, he's my boy. In fact, he's the one who encouraged me to make a substack a long time ago. A long time ago. What were you doing before? I had a WordPress blog.

And I was like consulting on the side. But I was like, okay, let me do a substack now. Because I saw him making money off and I was like, this is shit. Like, why are you getting paid for this? There were multiple times where he wrote something. I was like, I could do way better. And obviously, like, it was good because we both taught each other a lot of things. And we've been great friends.

And eventually he joined semi-analysis. But, like, you know, his background is he was a hedge fund analyst. And then he decided to do a substack slash hike the Continental Divide Trail for like six months, walking from Mexico to, you know, and then, you know, came back to doing substacking and tried to do a fun. Six months of touching grass and then he was like, I'm ready to lock it on Clock Code. Yeah, yeah. And so now he's, you know, like, he's never been a software developer. Yeah. Right. But he's been on a generational run. Like he's, he's not coding anything, right?

He's just telling Claude to do stuff. And like, it's to the point where it's like, our, like, head of data, head of IT. He's like, oh, can you send me that? And he's like, how do I do that? And then he's like, he zips the whole thing and sends it to him. It's like local host. He sends him a leak wants. It's like, local hosts. It's like, bro, that's not how this works. But yeah, no, I've talked to some folks who vibe code. They'll be like, and I'll be like, why do you choose No.js? And they're like, what's no JS?

That's a very specific choice. Someone? Someone? Yeah, Tyler. We went on a little tour of a lot of our clients. Like, you know, roughly like half our business is, or 40% of our business is like hedge funds. So we went to New York a week, two weeks ago, and we went to all of our clients. And like, part of it's like them asking me is opening, I fucked.

And I'm answering like, no, I think they're fine. And then like some like actual ideas. And then like a lot of his Doug's just telling them, Claudecote is like, they're like, you don't have to hire any junior hedge fund analyst anymore. And they're like, the junior hedge fund analyst, and then he's explaining, you know, what can you do? It's like, well, like, you can just do, like, financial models and perform a financial models

and, like, everything in Claude Code without ever opening Excel. And you can generate charts and, like, you don't need to know how to code. You just need to know how, like, how this stuff generally works and you can just do it. How many hedge funds are just trying to copy trade situational awareness? I mean, I think everyone who's, you know, I think a lot of hedge funds obviously believe in AI. I think there's a lot of them who don't believe in it, right, to be clear. But a lot of them that have done the best, believe in it.

Why are they selling software everywhere? Oh, you mean selling software stocks? Yeah, yeah. Oh, yeah. Why the sell-off then? Yeah, I mean, of course, it's like an incremental thing, right? But anyway, so these hedge funds, like, and then the question is like, okay, if you believe in it, how do you manifest that trade?

And so when you look across the, like, ecosystem, I would say almost all my clients sometimes think our two years out, numbers are too high. But like there's, like, Leopold's like, your numbers are too low. And so it's like, it's like, in general, right? And I think, I think like if you think about how much do you believe in AI and what's your access to information of AI, you know, there's not many hedge funds who live in San Francisco and like fully breathe and live and understand it. And then depending on how much you believe in AI, how do you manifest that trait, right?

Are you surprised that more hedge funds wouldn't, like, even just smaller shops, wouldn't say like, hey, this AI thing seems like, it's gonna be big, maybe we should set up in San Francisco? Or hire. There's a number of people, right? So we're getting an office together, Leopold, myself, Dwarkash, and then a client of mine, another hedge fund.

And they have one analyst here, and it's like, and there's like a number of other hedge funds that are like hiring analysts here, but, you know, being plugged into the AI ecosystem does not mean you're just in San Francisco because you can just walk around and talk to, like, doofus, like, startups and VCs and, like, not actually, you know,

see what's coming down the pipeline. And you have to combine it with all, sorts of information, right? You have to have a good tune with like what's going on in Asia supply chains. You have to have a good tune with what's going on in New York. You have to good tune with like what's going on like in the financial markets, right? And then like what's going on in credit markets and what's going on in all, you know, the data center, energy, blah, blah, all these different industries. And so it's actually not like so simple to like be in tune with what's going on in AI. You can easily get like head faked, right? For the longest time people

were thinking, you know, Adobe's an AI company and like, and it's like, for a bit, like, like, O'DOW was going down on AI, and then they like launched a few AI features and the stock skyrocketed. And then now it's going back down again because people realize, oh wait, no, actually, it's not an AI company. Like, I think it's the manifestation and thought

of like what is actually gonna, the world gonna look like if Anthropic 3X is its revenue again this year, open AI two X is its revenue again this year, or you know, by the end of the year, how many people even believe by the end of the year AI startup revenue is over $100 billion? I think that's an insane statement for a lot of people, but that's what it's gonna be.

Yeah. Right? And who believes that number, right? It's like very few people. And then you draw the continuation. It's like, and who believes, you know, and when Anthropics says in their funding, like, hey, we're going to have $300 billion of revenue by the end of the decade. And it's like, actually, I think that number's too low.

Because the economic value of what they're going to create is going to be insane. Yeah. And you tell people, oh, you know, opening eyes is going to have 18 gigawatts or 16 gigawatts by the end of 28. and they're going to be able to pay for it. And that's like, well, that's $300 billion to spend. How are they going to pay for it? It's like, you, sweet summer child, don't worry. Sam can raise.

They're going to blow up on revenue. They're fine, right? Like, it is like a bit of a vibe thing. It's a bit of like, you know, irrational exuberance almost, right? Like, Leopold's in his, you know, mid-20s, like, I'm 29. Like, we are irrational, right? Because we have not lived through. You know, you've got these PMs who like,

you've never been that humble. I don't know. Like, we almost, my first. family almost went bankrupt in 2008, like, you know, because we lived in a motel and we almost foreclosed. And we actually did foreclose on one motel. It's like pretty bad. But like, yeah, I mean, I was still a kid, right? Like, it was like, yeah, I've never been humbled in the same sense. I mean, it's good to live through that and understand how things can go wrong. What are you expecting out of Zoc and META this year? We've been big Zock defenders, especially. I mean, there's this

pressure of like, oh, meta is spending so much and yet they haven't created it, you know, any, any AI product that's super compelling or that's really working. And our stance has generally been meta's making more money from AI than almost any company in the world outside of Nvidia. So it's like, of course Zuck should be justified in saying, hey, this is real, it's big. Like, I'm going to like back the truck up

and go all in. Yeah, I mean, it's clear if you look at the most recent earnings, I think there's CPM went up 9% when the consumer's weak, which means like if you were to like try and strip out, like, what is consumer spending increasing for a CPM of ads versus what is the efficiency? effectiveness of their algorithms or algorithm got better by double digits in one quarter. Yeah.

Right. It's like actually insane how good the algos getting, right? At serving you the slop and the ads, right? So, so in that sense, like, the big sound of the trough. I love it. Slop for the, it's, it's, we're going all in on that. All in on the farm. Slops.

I love it. So, you know, if you think about it, right, like, okay, meta's, where are they going to, like, win, right? You know, I think if you have the Galaxy brain take, it's like, well, they've got the best, like, wearables coming down the pipeline. They're going to put AI on it. Apple won't be able to put good AI on their wearables, so they'll seat it all to, like, Google or Anthropical. People have had this narrative, oh, as AI gets better, the value of real world experiences will increase. And I think that's a cool theory. But if you actually play it out, AI getting better means more content that's more like effectively crafted for you, more personalized, 100 times more, a thousand, a million times more content.

That would imply to me that people will just use digital products more, which means more time on site, more time in the app for meta. So I don't know. I mean, I'm with you entirely. But I think, I think like the galaxy brain take is that you're just going to have a wearable and that's going to have an AI assistant open. trying to make wearables, you know. You know, there's, there's, you know, everyone's trying to make wearables, Google is, et cetera, et cetera. I think metal will actually execute and then they'll have a good AI. And then you stack on like a few things, right.

How do they get users? Well, we've seen at least if you look at the user metric charts, Google's use, you know, open eyes users were growing, growing, growing. They were going to hit a trillion by the end of the year. They had 800 billion. Why did they not keep growing in the last quarter? It's because nano-bonanato came out and they took all the incremental users, right? And likewise, if you go look at,

like, you know, Gemini III didn't actually make Google grow that much. It was Nana Banana and then Pro or two or whatever it's called, right? Those are the ones that made them really grow. Metas licensed all of Mid Journey's code data models, right? One, two, they're like actually just like focusing hardcore on that. Was that a billion dollar plus deal? The number is undisclosed. Mid Journey still exists as a company. No, it felt it looked to me like effectively a massive exit, but the best case. scenario where they can just keep kind of being artists. I think, I think, if you had me guess, I would bet it's over a billion.

Every deal that Meta did was over a billion. Basically, whether it's an employment contract, a licensing deal, and acquisitions, everything had to be after it. Well, so the interesting thing is meta... You're missing a zero again. Don't never miss the zero again. Every discussion was how many billions are we spending on hiring this person, buying this company.

Well, you know, meta interestingly has gone down. down market for a compute because there's not enough compute in the big size deal, so they've actually gone and bought like small clusters. Oh. Because it's like, well, I want more compute. From like long tail neoclods? Yeah, just like, yeah, from a longer tail. Okay. Because that's the only place they can get the compute they need. Interesting. Because, you know, they've already like went out and signed big deals with Google, and Core weave and so on and so forth. Is Cluster Max 3 going to be a smaller chart because of consolidation in the industry? No, there's more. It's going to be bigger. It's going to be bigger,

bigger. But, but, but, you know, so metal. That's ominous. It's ominous. So I think meta will capture consumers through generative. If there's more content, people are just going to go to the content marketplace, right? The creator of the content captures less value as there are more content creators and more diversification of content, right? And so I think meta just wins by being a platform, right? Google does too and bite denseness too, right?

But like those three win by having a platform. And then the real question is, can they get in the assistant productivity game, right? And I think this is important. And through that effectively search. Like if you're an assistant, it means that you can, like, there's some commerce happening. Well, they spin out and poached a bunch of people from Google.

So this wasn't in the media much, but, like, they actually poached Google search people with similar sized deals as, like, these crazy... Yeah, research. Yeah, and I always, I, you know, demoing any of the wearables, you can imagine, like, meta wants you to walk around in the world and see, like, oh, what are those headphones? And, like, while we're talking, I just hit my little thing and buy it.

right and it's like you didn't even necessarily know that it happened but like of course meta is going to want to monetize that everyone knows those of the Sony MDR X two 272s dude I've been I've been screaming about them like doing some proper marketing branding it's it's literally like they're over it here is like WH X 1000 XM 5 and then their in here is like WF 1,000 XM 1000 it's like dude just call them like bravia buds and bravia like headphones or some shit well they China just What? What?

Yeah, the Bravia brand's actually a Chinese company now. Sony sold their TV and... PlayStation Buds. Yeah, yeah, PlayStation. Walkman. Oh, yeah. Walkman. Like, come on, like, something, something.

For sure. Anyway, anything else, already? No, this is great. I'm excited for this weekend. Yeah, yeah, super excited. What are some plays that we don't watch a lot of sports? What are some plays? You are a football guy, right?

Yeah, yeah. Georgeman? Yeah. rural Georgia, so I like football. High school football was the thing. College football was the thing. I think NFL is a little less soulful. But, you know, now college football has the NIL.

And so it's also soulless to some extent. It's fine. We enjoy it. You know, primal desire of seeing heads clash. Yes. And sometimes that manifests in, like, you know, Twitter drama and sometimes it manifests in real football. Yeah.

All I can say is fuck the Patriots. Okay. Whoa. Okay. Okay. I'm kind of bummed. We're going to, since we're going to be at the game, we're not going to really get the great experiencing the ads.

I'm going to be like glued to my phone. I want to see all the AI, the different... Well, don't worry. I got some more ads for you. Thank you so much for coming for your show. Great segue. This message has been brought to you, by it. Public, investing for those to take it seriously.

Stocks, options, crypto, treasuries, and more with great customer service. Also, speaking of ads, we're brought to you by vibe.com. where DDC brands, B2B startups, AI companies advertise on streaming TV, pick channels, target audiences, and measure sales just like on meta. What else is in the news, Jority, before we get out of here? We never somehow never covered this. Waymo confirmed that they raised $16 billion at $126 billion post, according to Ed Ludlow over in. I saw a bunch of VC victory apps.

Sequoia getting in the mix, DST Global Dragon. It was sort of a bold move for a lot of VC firms to go in so early as the company was sort of spinning out. And of course, Google via alphabet did 13 billion of the round themselves. So this was sort of them. The medal of honor on themselves. Exactly. Yes. While you pull up the next one, let me tell you about Figma.

Figma make isn't your average vibe coding tool. It lives in Figma so outputs look good, feel real, and stay connected to how teams build, create code back prototypes and apps fast. Pull up this post from Redaction. Okay. It is Twitter. Every time a minor AI advancement occurs. and like this new block meta

changes everything. This new block meta? It's like, there's a lot of this going on. Well, you know what else changes everything? Gemini 3 Pro. Google's most intelligent model yet. State of the art reasoning,

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card and that's our show goodbye