TBPN - Logan Bartlett, Kian Sadeghi, Joshua Steinman, Sam Lessin and Seth Rosenberg Debate, Intel's New CEO

Episode Date: March 14, 2025

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You're watching TBPN. It is Friday, March 14th, 2025. We are live from the Temple of Technology, the Fortress of Finance, the Capital of Capital. This show starts now. We got a great show for you guys, folks. Today we have Logan Bartlett calling in. We have Keon from Nucleus calling in. He's announcing a new product, DNA sequencing. It's going to be very interesting. We got Josh Steinman, the legend, the man, the myth, the man who says every single morning. Good morning. We are going to win. We're going to find out if he's winning. And we have the great AI debate. We are putting two venture capitalists in a cage and only one will leave. Some people are calling this VC on VC violence, but we're going to try to keep it civil. We'll try and keep it civil. So Seth Rosenberg and Sam

Lessen are going to be calling in. They've been going back and forth, not only on the timeline, but on the 101. They've been billboarding at each other. Billboarding at each other. Sam Lassen and the slow team threw up a new billboard that said got an AI. startup idea, shoot at Seth Rosenberg a message, not slow. And this has just been on the 101 as of yesterday. Lots of fun. Lots of fun. We're excited to have them on.

But that starts in half an hour. For the next half hour, we're going through the news, bringing you the top stories in technology and business and finance. Top story today. Intel has a new CEO. Pat Gelsinger, absolute dog, one of the greatest to ever do it. Was it Intel for a long time? Struggled, but absolute legend.

And if you go back and listen to his Dutertechari interviews, you'll understand that he is someone to be absolutely respected. And even though, obviously, there were lots of problems with Intel, the shift to mobile, the TSM stuff, losing their grip on the Foundry model, still a fantastic CEO and someone who I just think should be respected in the technology industry forever. But today we're teaching you about the new CEO,

a former board member has stepped in. His name's Lit Bhutan, and he's returning to overhaul the chipmaker. And to be clear, looking on public, the market likes this. They're up 18% in the past five days after basically just kind of, you know, they obviously given like the crazy sell-off too. Yeah, I mean, part of it's potentially just the, you know, rebound from a pretty intense sell off. Yep.

But this is, you know. And now a lot of people were saying like it was a mistake to not stick with Pat Gelsinger. But we'll see. Hopefully this works out. Let's break it down. The selection as the new, as the chipmaker's new chief executive officer was cheered by analysts, bankers, and shareholders.

He brings two decades of semiconductor industry experience, relationships across the sector, a startup mindset. I want to know more about that because he is 65 years old at this point and has been on the board and in these really. large companies. We'll see if he can go founder mode now. And he has an obsession with AI and basketball. He also comes with tricky Chinese business relationships.

So that could get more complicated. Unders scoring Silicon Valley's inability to sever itself from one of America's top adversaries. So even though people want to go all in on America, there's still lots of flow back, back and forth between the two most important economies in the world. How tan age 65 will use his assets to resurrect Intel is on the minds of all industry watchers.

Intel has gone from being one of Silicon Valley's biggest innovators to a relic struggling to compete with superstar, NVIDIA and others in the age of AI. Its stock lost two-thirds of its value in four short years as Intel sat out the AI boom. This is, of course, because Intel's known for making CPUs, not GPUs, very important for the normal apps that you use every single day,

but not the next generation of video games, three rendering, and AI. One interesting point, Gelsinger, was, pushed out three months ago. Yep. So there had been this intermediary CEO. Yep. That's,

that's now step back. But they think they're, they think they got their guy now. Uh, so shares were up more than 14% at market close. Sounds like they're, they've been up more since then. Um,

the new CEO will soon have to answer the most burning question about Intel's future, whether he will break apart Intel's design and foundry businesses. I think Ben Thompson has been advocating for this. A lot of people have been talking about this. Basically, manufacturing chips is an enormous, expense that Intel can't currently sustain. This is what industry leaders and analysts say,

and former board members have called for a split up. And so, invidia, of course, is a fabless semiconductor company in the sense that they work with TSM. TSM does not do design. They only do the manufacturing, the fab. And so when that separation happened, it was very questionable because, you know, maybe you get some benefits to having everything being integrated all the way from, okay, you get an Intel Acceleron processor. It has a brand. You know, your average customer might not know, but certainly some gamer who's building their own PC wants the Intel brand. And that Intel brand leads into design choices that they make to make the computer run faster. And then they actually make it themselves.

So that integration makes a lot of sense in many ways. But it allowed, it kind of restrained them from. having the flexibility to play in new areas as they came up. Totally. And Nvidia has shown that they can just focus on this one aspect of the stack and still put up ridiculous. Margins. Yeah. And that's because they, even though they don't own the manufacturing, they have the software

and the NB Link and Kuda and this ecosystem where if you're a very, you know, heavily funded large language model, foundation model company, the best engineers in the world, they want to do foundational research, frontier research, and they don't want to learn a new language. They want to just write Kuta. And Kuda is not perfect, but it's certainly the best in the ecosystem by most accounts. But a deal to sell all or part of Intel to competitors seems to be off the table for the immediate future, according to bankers. A variety of early stage discussions with Broadcom, Qualcomm, Global Foundries and TSM in recent months have failed to go everywhere, anywhere, and so far seem unlikely. And this was the story that we covered earlier about the private jets of, I believe, Broadcom, Intel, and Elon were all at Mar-a-Lago at the same time.

So there might have been some deal. Which I honestly think that was somebody trying to make a story out of everybody just being around Mar-Lago at that point in time, because many of the most important people in all of the world and business were there. They might have just been golfing. Yeah. They might have just said, hey, like this get together. We're not talking business. Yeah. We're talking par threes, par fours.

Let's be the first group to keep business off the course. Yes. Exactly. The company already hinted at a more likely outcome bringing in outside financial backers, including customers who want a stake in the manufacturing business. Intel fortunes also rest in part with President Trump, who has signaled that he wants to unwind the Chips Act, signature legislation from former President Joe Biden,

to invest more than 50 billion. in semiconductors, Intel would receive up to about $8 billion through the legislation contingent on development of new factories, which have faced delays. And of course, TSM is now building fabs in the U.S. and there were early reports that it was going better than people expected. There was a big question about, okay, it's not just you get some ASML machines, you get some lithography machines, and then you turn them on and boom, you're just printing chips. You need really, really talented individuals and most of those individuals live in Taiwan and they might not want to relocate very quickly or move over but uh things have been looking good but i'm sure we'll we'll need to dig into it

more um tan wants to wonder how bad it would have to get sort of geopolitically for ben thompson to leave Taiwan because you can imagine him just you know yelling into his newsletter i'm not leaving i'm not leaving you're going to have to drag me out of here then we'll have to do a strike mission pull him out. Yes. Pull out one of the greatest writers. He is one of the most valuable assets on that island. Right below TSM.

Yeah, exactly. Geopolitically. It's like we need TSM and Ben Thompson. Ben. And then who knows what happens to the rest? I'm sure there's a lot of other important stuff over there. Tan has likely no more than a year to turn the company around, said people close to the company. His decades of investing in startups and running companies, he founded a multinational venture

firm and was CEO of a chip design company called Cadence Design System. He served there for 13 years. Good run. Provide indications of how Tan will tackle this task in the early days by cutting expenses, moving quickly, and trying to turn Intel back into an engineering first company. In areas where we are behind the competition, we need to take calculated risks to disrupt and leapfrog. Tan set in a note to Intel employees on Wednesday. And in areas where our progress has been slower than expected, we need to find new ways to pick up the pace. So this could be really interesting. I don't know if they're going to go on an acquisition spree, but, you know, there is a lot of there is a lot of

a question about what does the next chip look like after the GPU you know Google's built the TPU but then you also have startups like that's Facebook is rumored Facebook has one even rumored yeah Amazon has one but there's also the question of you know these new transformer-based AI inference focus chips like from etched and there's a few others Cerebrus there's Grock there's a few others I forget I forget the other a start but a lot of people, they raised money very quickly, they got line time with TSMC, they became like great designers, but there was a question about could these companies really go the distance

or would they land with a company like Intel ultimately and just provide a new product line that then Intel could push. Either could be fantastic outcomes for everyone involved. So many take this culture reset to also mean significant cuts at Intel, which has already shed about 15,000 jobs last year. Wow. That's like what? like a quarter docu sign they lost.

Yeah. Something like that. Almost to a T. To a T. He is brave enough to adjust the workforce to the size needed for the business today, a former Intel board member who is known TAN since the 90s. TAN's first tour at Intel as a board member from 2022 to 2024, ended in frustration.

People say, people close to him say. Although he cited time demands as reason for departing, company insiders believed TAN was fed up with the bloated work force and direction under then CEO Pat Gelsinger. Tan's return then signals an inevitable change in strategy. His capabilities aside, Intel remains far behind modern chip production, said Mark Rosenblatt, and Intel's balance sheet is not sufficient for the cost required to sustainably achieve it and scale the manufacturing needed to support it.

Our team management cadence was going through turmoil similar to Intel's when Tan took over in 2009. He was able to refocus the business, push its services to the cloud and land. new customers, including Apple. A company on the brink of delisting went on to return more than 3,000% in share price during TAN's tenure. Let's go. So I was gone for that.

There we go. Good stuff. Tan in public talks has described how he approached reshaping Cadence's culture to eliminate what he described as silos. I tried to change it into a one-team culture. That approach harkens back to what he calls his first love, basketball. Born in Malaysia and raised in Singapore, Tan aspired. to be a professional basketball player

until his mother told him to get a real job. I love it. He said during a video interview during January, well, I'm sure his mother's very happy now. Hopefully she's still alive. But I'd like to... Because there's no more real job than CEO of Intel. Yeah, I'd like to see him go on a generational run at Intel

and then buy the NBA. You know, don't just buy... Don't just buy a team. Don't go balmer mode. Yeah, buy the league. Yeah, by the league. And say, I'm a professional, you know, player now. Does that make sense?

Tan has declared the arrival of generative AI as bigger than the invention of the web. He's spent the past several years investing in AI startups across the globe. And let's go into the China connection and then we'll move on to the next story. Before he rose in the semiconductor industry, Tan was known as one of the first Silicon Valley

venture capitalists to invest in Asia. I'm sure he did very well. Tan is founder and chairman of Walden International, a prolific investor in Chinese tech companies. He was a big champion of China's semiconductor, sector in an era when U.S.-China relations were considerably rosier, including co-investing with a China state-owned asset manager. Party around.

He was an early investor in Smick, which is the semiconductor manufacturer international. I believe that's Smick, which the Commerce Department blacklisted for its alleged ties to the Chinese military in 2020. Walden sold his last stake in 2021, and in 2023, the House. select committee on Chinese Communist Party sent a letter to him. We got to get Steinman's view on this whole era. I'm sure he's going to have a nuanced take, folks. Yeah, you can expect nuance.

Yeah, you can definitely expect some nuance from Mr. Steinman. That's great. Intel, as word of TAN's new role spread, one Chinese media outlet headline the news. Intel hires the CEO with the best knowledge of China's chip industry. Interesting. Yeah, that you miss. the line here too. A subsequent report from the committee highlighted hundreds of millions of dollars of Walden investments that went to Chinese companies involved in military activities or human rights abuses.

It's not good. Kind of a weird market likes it. Weird pick in the context of this being one of our great American technology companies. Keep your friends close. Keep your enemies close. Yeah. The steel man here is that he's not a Chinese national. Exactly. And, you know, I would, let's give him the benefit of the doubt that he is deeply loyal to the United States and which just, you know. I mean, yeah, there is a world where you invest in a Chinese semiconductor company.

You see how fast they're moving. You take the threat realistically. You don't want to be Jack Ma. You would much rather be Jensen Wong. Yep. And not get thrown in jail when you throw on a leather jacket and become a superstar. Right? And so you come to, you know, you take over Intel and you make it amazing and you become a legendary American turnaround CEO.

And that's just, that's just a fantastic outcome for everyone involved, well, except for the CCP, but I'm happy with that. So I don't know. Yeah. We'll be tracking it here. We'll get him to call into the show. We will chop it up with us. Talking to a correspondent over a truth social, seeing what Trump has to say. about this, you know, appointment.

I'd be interested. I don't know. I've always been very, very optimistic about Intel, very pro-intel. And I used to have a riff about how, you know, I wish Elon had bought Intel instead of Twitter because maybe semiconductors are more important. Now you talk to, you know, all sorts of folks and they'll tell you, well, like the free speech thing is really important

and there are good good reasons why it was important to to for the X deal to go through. But why not both? Yeah. Anyway, I mean, it does say a lot that Elon seemingly looked at the opportunity. Maybe. Didn't go for it. I mean, it's a lot of work. He's got a lot of work going on.

But it's very possible he just didn't see. It's very possible that Intel is valuable, but Elon didn't see sort of value for, for, the sort of Yvon ecosystem. Totally. Well, if you're looking to go long intel, go short intel, whatever you're thinking, do it on public.com investing for those who take it seriously. They have multi-asset investing, industry leading yields, and they're trusted by millions. Stocks.

Go to public. com. Options. Crypto. You can do it all. Do your own research and then make a bet. Anyway, let's move on to the economy. economy, everyone is worried about a recession and the Wall Street Journal is breaking down

where you should be looking. Not reacting at all to me. I love the hats. I love the hats. I'm just going to start not even making eye contact with you. Just fully focused on the mic, the public hat. That's great. So the Wall Street Journal has an article here.

Here's what to look for in terms of early signs of a recession. Tariffs, government layoffs, funding cuts, immigration restrictions, recession talks in the air. Any one of these things would at least temporarily exert some drag on the economy. Put them together and they have an everything everywhere all at once dynamic that could hurt it badly. White House officials have cautioned that the economy might need, as Treasury Secretary Scott Besant put it, a detox period. At the same time, some of President Trump's promised challenges such as less regulation and a big tax cut are pleasing to many businesses and could stir them to invest and hire more. Very true. Major economic data hasn't fully yet begun

to capture Trump's time in office. The Wall Street Journal is looking at a host of other factors to figure out whether the U.S. might skirt a recession or fall into one. Here are some areas to watch. There's the Small Business Uncertainty Index, which is at a high point and ticking upwards, but a lot of that happened kind of before the election.

Mentions of soft landing in company conference calls or seems like it's very, very low, which means that people in, business or maybe a little bit worried. Yeah, but this is this terminology started being used very clearly. You can see it in this chart they were looking at in 2022 where everybody was like, okay, things seem to be correcting. Can we is a soft landing possible.

Yeah. And objectively, at least from a market standpoint, it happened. It happened. Yeah. But maybe we were still to see. You don't start. You stop talking about it. Maybe we didn't land.

We just sort of leveled out. Yeah, yeah. So I don't think that's necessarily the right data point. But the U.S. policy uncertainty index is at an all-time high. And that makes sense. Everything feels very uncertain. But hopefully, you know, certainty around policy can happen very quickly. Like, we can get certainty around these things.

We saw that with the Bitcoin Strategic Reserve. Like, it was very uncertain on Tuesday. And then by Friday, it was pretty. pretty certain. And so, you know, that's not that much turmoil in the market. Anyway, the policy uncertainty index is based on U.S. news articles has soared. It recently hit its second highest level in data going back to 1985. The only time it was higher was in the early days of the COVID-19 pandemic. Even for businesses that are enthusiastic about the White House's deregulatory agenda, the whiplash of uncertainty could be causing problems, not knowing,

for example, what products might be subject to tariffs and at what rate we talked to Avi Schiffman yesterday, he said, I didn't want to make my product in China. I made it in Canada. And now I have a tariff on my product. So that's a perfect example of uncertainty. You know, if you want to set up a new manufacturing plant, you might be in the wait and see mode right now. And that hurts investment. That hurts the economy. That slows things down, right? And so consumer sentiment is dropping and the probability of delinquency is also on the rise. But this is a trend that's been going on for a few years now. Tiny bottles of liquor are flying off the U.S. store shelves.

Whiskey and tequila makers said sales are up for miniature 50-millimeter bottles, often called nips, as well as for 375 milliliter bottles, which are half the size of a standard bottle. So do they make a- Is that historically a recession indicator? Of course, because people stop going from, hey, we're throwing a party and we're getting a large bottle of alcohol to, I need my alcohol and I just need the cheapest thing possible because I'm living paycheck to paycheck. It's very sad. I would say stick to the 50 milliliter bottles of Dompering on if you can if you're if you're struggling. But yeah, it's a tough, it's a tough recession indicator. And there's been a few others about what products have been slowing down in convenience stores. We looked at that in the Wall Street Journal earlier. And it seems like people are buying less because of course, even though inflation, we talked to Delian about this,

Trueflation.com is showing that inflation is coming down. But again, inflation is a rate of change. And so we're not seeing deflation. So the prices are still high because once you go through a period of inflation, the prices are higher. And they're not going back down. So the rate of inflation is declining, which is great. But that just means high prices forever, basically,

unless they come down. That's the nature of these things. So people are starting to feel that. And they're seeing that, hey, the economy and my salary is maybe not catching up with the higher prices. I'm going to buy less. slows down the economy. That's certainly the...

Yeah, J.D. Vance did an interview yesterday, and he said, you know, a part of... It's possible for the underlying sort of economy to be fine, yet like the sort of fear and sentiment, you know, sort of takes over and people just start sort of anticipating a recession, and then there ends up being like somewhat of a slowdown or like change in consumer behavior. Vance has taken a fairly hard line on this.

He says, yesterday you can never predict the future, but I think the economy and the fundamentals of the economy are actually quite strong right now. Sort of his job, he's got to defend, like the policy coming out of the White House. But yeah, I mean, it's not that unreasonable to think about the fundamentals. Like if you think about previous recessions and depressions,

they're built on, you know, massive bubbles popping. The dot-com boom, so much money had poured into companies just making no money and then there had to be a retreat or you've built up this crazy house of cards on top of the real estate bubble and all of a sudden people have six homes in the desert that are just sitting empty and and right now you could point to a lot of things that feel frothy but it's hard to say like the u.s economy is built on a house of cards right now at least no one's concocted a strong thesis around that so um although there are nervousness and weakness spots of weakness here and there.

No one's really sounding alarm bells in the same way that Michael Burry did during the housing crash. Yeah, except random and on accounts. Well, yeah. I mean, as you've said before, like the most alpha you can possibly have is just tweeting top every single day. Yeah. And then eventually they get it right.

Yeah. And so I think the key to tweet a top and it's like very much near the top, right? Because we're now off the highs and he looks like a genius, I guess. I'm very excited to have Logan Bartlett on in just three minutes. He's going to be walking us through a Red Point Market Update that they gave to their LPs. This will be interesting. For March 2025. Has he invested in any interesting like power law fintech companies?

John, you know what? There's one that comes to mind. Oh, which one is that? I think the website. It's ramp.com. I think it's a domain. That's a good domain. Yeah, it's a great domain.

So it's an investor in a room. And I think the company is pretty great too. Yeah. And what do they do at that domain? They're an all in one finance platform that saves companies time and money. That's, oh, I mean, that's great because time is money and you want to save both, right? That's exactly right, John. Yeah, yeah.

Maybe you could pull up some more info on it. I mean, I'll just, I'll just pepper you with questions. They have corporate cards, right? Yes. Are they easy to use? Absolutely. What about bill payments? They have that as well.

Accounting? Yes. Do they have a whole lot more? They have a whole lot more. Wow. And you're telling me it's all in one place? It's all in one place, John. That's almost too good to be true.

But it's not. It's not. It's not. You can sign up and you can use it now. And where would I go to do that? Just go to ramp.com. And tell them that the show formerly known as Technology Brothers sent you. Sent you.

Okay. I think I'm getting it now. This is really cool. Yeah, we should check this out. But anyways, Logan actually invested in Ramp. I believe it was, we'll have to ask him 2021. And he took a little victory rap lap when the new round got announced because they're back at a healthy multiple of where he invested at.

Yeah. I mean, in terms of like high status things in the Valley, it's really just, are you a Ramp investor? And then above that, it's like, are you advertising Ramp? Yeah. That's the real, like, maybe we can convince him, to run some ramp ads soon because that would really like broaden his appeal. Yeah, his podcast right now is presented by his fund Red Point.

Yeah. But it would be much better if it was presented by ramp, I think. That's right. Let's try and get him to do some ad reads. Maybe we'll get him to do an ad read on this guest spot. That's great. We should have like a bucket poll for the for the guests. I mean, we're having the billboard guys come on to argue about AI.

We got to do an ad quick ad. in between that. Yeah, yeah, yeah. Pause. Hey, pause. Right in the most heated moment. If you're looking to get in a fight with another venture capitalist, go to adquick.com, throw up a billboard on the 101.

And you might just find yourself debating another VC on the TBPN show live. Anyway, how are we doing with Logan? Is he ready to come in? He is not ready to come in. Should we move on to some bucket pull, some bangers, some random posts? Did you see this AI written email? I hear you're in New York. You have to check out Central Park and catch a Broadway show.

It's a blast. Ashley Meyer says, gee, I wonder if this vendor email was written by AI. It's pretty ridiculous. It is remarkable how low the bar is for some of these. It's maybe just like these... It's funny. New York is one of the... I mean...

Yeah, I mean, to me, AI should just focus on what actually matters and not focus on the sort of human connection piece. Because if you're sending, like the whole point of this is to try to send a super high volume of outbound. That's sort of like superhuman level of outbound. And so for every, you know, if one out of five messages that's like using this sort of personalization feature is just like making somebody like, not respect you. Yep. Like, it's not,

it's not great. Yeah, it's kind of an unlimited downside situation, which I think is why a lot of, you know, Apple has been slow to adopt it and a lot of large organizations

have been slow to adopt it, figuring out the right level of like human and loom and stuff. Yeah. They, I mean, those, those summaries are fantastic. I message for you.

I, we, I want to talk to Bryce about that more. Did you see he responded to my Apple intelligence thing? We got Logan Bartlett here. What's up, What's up? How you doing? Good. There he is. Thanks for having me on. It's great to have you. It's great to have you. How's the reception been to the market update? You getting any pushback or are VC's already sort of making threads or based around your content and sort of making it their own?

Yeah. Well, it's a you know, we were done like a week or two ago with all the content. And then obviously the market went crazy. And we had. had to like redo, I don't know, 50% of the slides or something. So I, uh, thankfully it didn't end up being too stale. We froze all the data on Monday and Tuesday, Wednesday and ended up actually being pretty tame in terms of the market trading. So I think people can rip off all the slides for their annual meetings that are coming up here in the next couple weeks. We're happy to open source and take credit for it. Give me the, give me the one liner. Is it so over? Are we so back? Are we poor? Are Are we rich? How are you feeling? Private or public? Let's start with public. I don't know. It's not a great answer. But I would say it feels like we're in for a lot of

bullshit that is flowing through the system. And uncertainty just isn't a great thing for any business. And while it's not going to impact software companies or technology companies quite as much directly, like the end customers for a lot of these different businesses are going to be impacted in a meaningful way. And so until we get a little bit more clarity on to what end all of these things are being done and what sort of the end state is, I don't know how you price in anything going forward. And so now that obviously changes by the by the minute here. So it could be we're at some steady state here in the next couple days or hours or weeks or whatever it is. And this ends up all sort of feeling kind of stale. But right now I'm not, I'm not particularly optimistic about

what's going on in the public markets. I heard some Morgan Stanley equity research person said that coming out of their conference, which is a week ago, they said it was the most negative sentiment that he had heard, I think with the exception of the onset of COVID in the last 10 years from people sort of like looking at the markets. And I assume that's just a factor of uncertainty. Yeah. Yeah. Is there, do you think there's some sort of like doge efficiency meme that's working its way through the market right now? Like I remember when Elon came into Twitter, X, you know, laid off a ton of people. There was this big question about like, well, what other software companies could do something similar. But is that now that you're seeing it done at the

federal level, are companies thinking like, hey, maybe we should pull back a little bit on investing and scaling? I think we've sort of seen it over the last couple years or at least the last 18 months or so. If you go look, one of the slides that we put up in our deck was sort of a tradeoff that's occurred between growth and free cash flow. And to some extent, that's the, you know, the macro environment. But also I think it's just the knobs being pulled a little bit between layoffs and hiring freezes and all that. And so I think people have, you know, the macro environment. have made the conscious decision that they can do more with less, and I think AI is only going to continue to pull that trend forward. Is it cutting to the bone like Doge maybe is doing or Twitter

did? Probably, probably not. People aren't taking it to that extreme. But I do think people have really recognized that there's knobs that are a little bit more pullable than they would have appreciated it otherwise. And I think, I mean, if you look at the big software private equity folks, the Vistas in the Toma Bravo's of the world. Like they've been doing this for the last, it's 10, 15 years. I just think it wasn't something that people really tried to do in the public markets. And now we're seeing that actually occur in a more meaningful way. For you as a multi-stage investor, what advice are you giving to the sort of average Series

A founder in many ways, like we could have massive sort of GDP could go negative. but if you're a high growth software company that's just sort of hitting your stride, you can still thrive. How are you kind of advising, you know, your portfolio companies around sort of downstream capital? Because as Red Point, you guys are also, you know, a fund that can participate in some of these later stage rounds as well. Yeah. I would say that at least the last, I mean, the last five years has sort of felt like, so I've been doing this now for 11, been or 12 years in the last four or five have felt like, you know, twice as long as the first half of my career just in terms of all the changes that have occurred. That said, it does seem pretty uncorrelated what's going on at like a high level macro with the early stage funding

environment. I think to some extent what happened after 2000 was the like sophisticated LPs really pulled out of the funds that they felt had gotten too bloated or too big. And that's happened this cycle as well. I think if you talk of smart endowments or pension plans or stuff, they've definitely as fund sizes have gotten to $3, $4, $5, $6 billion, like those people have raised eyebrows and maybe voted with their feet to either scale down or walk away from those funds. But there's a lot of other money that has willingly and excitedly run into those big, uh, uh, fund raises. And so I think you're seeing sovereign wealth and Middle East people come into those funds and give them, you know, what, what, uh, two, three, four,

five hundred million dollars. And so it ends up kind of being a rounding error. If a smart pension walks away or endowment walks away. So the way that impacts the startups, I think it's just at a very micro level like continue to execute and the funding will be there. at least that's the way it seemed over the last couple years. And I guess it's true until it isn't. But all this stuff sort of feels outside of the control of the individual founders. And so I would encourage people not to worry too, too much about it. Yeah, related to that, I remember when the market crashed kind of around,

I don't even know what we have the term for, interest rate, like post-ZERP era. Yeah, post-ZERP, you were talking to maybe there's a meal Michael or someone, but about this idea of like there's a lot of dry powder and there was a lot of optimism from entrepreneurs being like, well, the VCs have the money, they're going to have to give it to us anyway. And you were kind of explaining to folks, well, like, the dry powder isn't necessarily sitting in their bank account, like they have to make capital calls. The LPs might put pressure on them. Like funds might get downsized. But it feels like maybe now the dry powder narrative was real. And now like all the VCs figured out how to start deploying again and deployment rates are up.

But how do you tell the story of the post-ZERP era to where we are now in terms of just the pace of capital deployment? Yeah, it's a great question. It's, I would say, I've been surprised at how consistent people have been able to fundraise. And I think there was really a triaging or kind of a hollowing out of the middle that occurred, or maybe the tier B, if you will, a tier two funds where you saw a handful of those folks, blow up or really struggle with their fundraisers in some way. But the names that everyone thinks about or knows, I think there was a concentration and consolidation of capital that came in. And then you couple that with some of our friends with seemingly endless amounts of oil money coming into the

sector as well. And it just it just sort of feels like we're in this new normal state where There's a lot of capital going around. And I don't know exactly what's going to cause that to change. It feels like there wasn't a ton of reckoning for sins that were made in 2020 and 2021. It feels like people were able to get a mulligan and say, hey, you know what? Like, yeah, we got a little crazy. But now we've really doubled down and focused on what it is that we do well.

And people seem, at least on the LP side, seem to be largely. forgiving or if they're not forgiving, there's someone waiting to take their place in one of these name brand funds. I mean, it feels like, yeah, there's gyrations and oscillations in the American early stage technology market, but where are you going to go if you don't invest in American technology? It's sort of like we all read the same books. You look at the founders today and like everyone's read innovator's dilemma or everyone's read like read the case study of Blockbuster Netflix. And so We're dealing with a far more sophisticated like entrepreneur that's executing or CEO that's executing on AI right now. And I think similarly, like all the LPs studied what happened after 2000, 2000, or sorry, 2000, 2001.

Like that was actually a great time to lean into the asset class. And so now we're at this prisoner's dilemma where it would be theoretically a great time for everyone to lean in if other people backed out because then prices would depress. But everyone's staying in. And so it's actually leading to prices staying elevated, which has been interesting. I mean, I think in the last couple of weeks, it feels like I've heard the meme or the, the refrain that it's like so 2021 or it's got 2021 vibes all over again. This was pre the last seven days. And so I'm not exactly sure how that's going to play out. But that's definitely been the sentiment in the private markets from the BCs that I'm talking to is just sort of like,

gosh, this feels like we're running this back and doing it all over again. Yeah. Yeah, I've had that. I've had this feeling multiple times this year where a portfolio company is just raising like a, you know, big up round. And depending on the lead, I'm just thinking like, why, I really wish I could sell into this round. Like even though I'm a believer in the company, it's just like, you know, getting so far over.

And the narrative is always there, right? Like I'm thinking of like one company in particular that will go on name, like really, really strong narrative, really strong traction. It's just like setting prices at a point that, you know, basically pricing in the next, you know, potentially decade of growth. And if that's the case as an investor, you ideally would want to get out and then just invest, you know, rotate into another illiquid asset. Because you're done. You got your growth. Do you get excited? It's such a feature and a bug of the private markets that you're not like beholden to the mania and you sort of get to play a long game and anything you're doing that when I talk to my private or my public market

friends, like they're envious that, you know, you can take a morning off and not have your entire world implode versus the public markets. Like, stuff can hit the fan and you, your entire day could totally change at a moment's notice. The flip side of that is you're really in for a long period of time. And you don't get to say, well, I'll take a few chips off now. because I think probabilistically, there's a better opportunity that could come down and it feels like this is a good risk-adjusted return. That doesn't really, that's not as accepted in the private markets. I think increasingly, though, we're finding some of the financial products for that. And I've seen more people or at least more opportunities to take a little liquidity.

I'm not sure it's totally socially acceptable, at least for the institutional funds to do it. I think it's far easier if you're an angel. people are a little bit more understanding of that, but it does feel like it just comes down to it comes down to volume, right? If I put 25K into a company and it does well, you know, and I want to sell the position, it's very different than, you know, you with like, you know, we have a $400 million position here and we're rotating out. It's like there's probably not the demand. Just one, I don't know if you feel even free to speculate on this, but something I've been confused by was, you know, the figure round, getting priced around $40 billion. Like, what in your mind do you think is the play there?

You know, Brett's last company, spacked, you could imagine figure, you know, I think a pure play humanoid stock would do well, you know, at least a little bit, a little while in the public markets. But what do you think is some of these later stage companies that are still a ways out from like true commercial adoption? but, you know, especially now with companies like CoreWeave, you know, the CoreWeave IPO, it seems unclear now if they're going to get out. But like, what's your read? Are any of these companies going to get out in the next year other than some of the bigger names like Chime?

I've heard, so a few different things there. I guess I've heard, I don't know if you guys have heard different things with CoreWeave in the last little bit, but it seems like there's a few people that are still kind of all systems go on IPO and are going to plow ahead. And poor weave certainly doesn't ask my opinion. But if I were counseling them, it feels like just get out there. And I think having some AI story with probably a bunch of institutional managers that want exposure to some derivative direct trend of AI, I would say it's probably as good a time as any, especially when some of these bigger contracts are coming up in 2017, 2018.

get out when you have a little bit of, you know, certainty of those cash flows coming from the Divideas and the Microsofts and the open AIs of the world. Like, I would encourage them to go. On the figure thing specifically, so I looked at Brett's business vettery, which predates the last one. And I actually really enjoy, I haven't talked to them in, I don't know, eight years or something, but I really enjoyed that interaction. Now, that was like a job marketplace or something. So very different than now he's sort of become this like hard tech founder, which is interesting from a job marketplace thing. The thing that I don't totally understand about figure in that round itself, and this is a common phenomenon at the not the end, but at the peak of a lot of cycles is you end up with a lot of these SPVs getting formed in a meaningful way. And you end up with managers trying to get write bigger checks for rounds.

then their funds can actually hold. And so it's hard to know exactly what the incentives at play for some of those names. So I wasn't familiar with the names that they're talking about in leading those rounds. But it certainly seems from a fun-size standpoint that those people probably can't step up and write those checks themselves.

And so then you wonder, what are the incentives at play for whoever is writing those checks? Like, what are they thinking about? And like, what is the executive team? Like, what is their incentive to raise at this price? Yeah. And all these things. I looked at it as if you're going to price it at 10 and say this is a pre-IPO round,

we're going to basically, we're planning to spec the company in the next year. We think it's going to pop. That type of round makes sense. But if, you know, you're pricing it at four times that roughly, it just feels like how do you actually get out of this? Who's going to get out of this position? Do the employees actually benefit? But that's just, you know, one example. Skill issues.

SPAC at 80. Spack. Why not? I do think there's this retail demand for, I mean, if I were open AI, I would try to get out sooner rather than later, right? Because I think there's this demand both from institutional and retail to have exposure to some of these things. And if you look, I mean, Palantires where they're trading and obviously there's a bunch of different considerations around that business. But like, I think that if you want to. went out and floated just a small percentage of your, you know, your overall business. I think that

there could be a lot of nice liquidity to fund a lot of the CAPEX. And you would trade at a really healthy premium. So it'll be interesting to see who of like the big model companies actually tries to get out first. Speaking of going public, do you want your private market investor competitors to go public, the general catalyst? You're like, yeah, I really, I want you to go from, you know, I want to be able to see your fund returns. Yeah, yeah. The disclosures are going to be crazy. It's an interesting thing. So our structure is not one that we can or ever will try to have the ambitions of doing that.

I saw when when people, there's certainly funds that that act or either call themselves have leaders that that are more akin to a CEO than they are, you know, investment partner or something like that. And so I think from a financial engineering standpoint and like institutionalization of the asset class, I'm excited to see people try these things. The cynical side of it, when I compare a venture firm to a private equity firm and think about the incentives at play. So if you're a private equity term, if you're Apollo or Blackstone or BlackRock or whoever it is, right, you're this big entity, the people within your firm can't really leave and compete with you. There's so much institutional infrastructure around, one, the quantum of dollars that you actually need. But then two, the relationships with the debt providers, the ability to process the deals, the ability to get access through the bankers. You can't just go hang a shingle or go join

another competitor to compete with Blackstone or Apollo or whatever it is. In venture, it's so beholden, I think, at least to individuals. And individuals can walk out the door and they can go raise $100, $200, $300, $400 million and like effectively compete with you in some way, shape, or form. And so there was an information report. I don't know if it's true or not talking about G.C. Moving from more carry to bonuses.

And I don't know if it's true. Information tends to do a pretty good job reporting, I think. And like that was reported alongside some people leaving, the organization and you just wonder like as the incentive structure start to change and you start to be more institutional how do you retain the quality of people so like at an intellectual level i'm very interesting interested to see all this plays out and i respect anyone that's like innovating in some way on on a structure that has been stuck in some version for a long long time i'm very curious about the practical implications of how it's going to work with like retaining individual talent and all that

stuff yeah that's been that's been my big question if if you're somebody that you know why wants to get into venture and you believe in your picking ability and you think you can be one of the greats, wouldn't you want to get the sort of maximum benefit of that by getting carry and being a part of a partnership versus, you know, oh, I got, you know, I invested in, you know, the next Slack and I got, you know, one time little, you know, bonus. Yeah, exactly. Who knows, who knows how to work, but, you know, I can imagine. Especially since the next option, if you can't compete, then it's fine.

You're kind of locked in. And like Goldman bankers or Morgan Stanley bankers or Apollo MDs or whatever, it's hard for them to get the scale to go out and really compete. And sometimes they do and sometimes they don't. But like that RSU structure, bonus structure kind of works when you can't really walk out the door and hang a shingle and compete. Venture, you kind of can. And so I think it's if you're good, you know, you can go raise. We see a lot of these solo capitalists or whatever, like small three, four, five hundred million dollars funds out there. And so I think, I don't know, retaining talent is going to be an interesting thing to see.

Have you, like last question on this point, have you seen solo, the sort of solo GPs overpaying to win deals? Because like that's something like, you know, sometimes you see these sort of obvious power law companies like the Anderals of the world with Elad Gill sort of like, you know, leading rounds. And that that makes that makes sense. I think there's sort of consensus now that Anderol is going to be a really massive company. but when you see a solo GP come in and write a $100 million plus check, does that ever, you know, you know, what's your, what's your read on that? Because from my perspective, sometimes those marks don't even feel real when, you know, there's something to be said of like, okay, Red Point like underwrote this and like, you know, they're like an organization and a firm.

And it's not just like, you know, one or two, you know, major, you know, so how do you, how do you look at those rounds. And I'm sure oftentimes you're competing to win those rounds. Yeah. It's, so I guess we've, I've seen less of that phenomenon than probably 2021. And I would have to rack my brain a little bit to think about like the big institutional, institutional solo capitalists are I think those terms are directly at odds with one another, but the big solo capitalists that can write those checks. I mean, I lot can obviously do that. And he's the one that certainly comes of mine. I would say, honestly, there's been some firms that have continued to scale where I've probably seen that more than any individual kind of solo capitalists out there. And I think

there was this thing where in 2020, 21, it felt like we rotated to the brinkly. We're where we lived in this world where everyone was just a Zoom screen away. And so Mark Andreessen and Doug Leone and Keith Rabeau and whoever could be in the room as quickly as I could be in the room because time and space weren't really constraints at all. And so in that world, I think there was a big gravitation to the big institutional funds because it was like, oh my gosh, I'm going to get Mark Andreessen involved. And that's amazing, right? it feels like we've rotated a little bit more back to like who is my individual board member,

who is going to be on the ground with me day to day. Like I'm going to solve for that person rather than the sole like just the brain, past a certain point, right? Like obviously you must be this call to ride the ride with some things. And so you got to have enough credible brand as an institution. But then it comes down to the individual a little bit more. And so I would say I've probably seen more than the solo capitalist thing. I've probably seen more of, hey, this fund has a bunch of money and you might not be getting

their number one person. It could be their, you know, whatever, their reliever out of the bullpen that's coming into the round. And those are the ones that they're like really juicing the price a little bit on these things because they, you know, they want the asset in that way. So I think that's something that I've seen more and more of of late. I want to go back to the Innovator's dilemma and I heard you on a podcast maybe two years ago right when the chatchy petee moment was happening debating is AI a sustaining innovation or disruptive innovation how do you sit with it now how are you seeing it get adopted in the public markets and what narratives are taking hold there I still I still feel like there's an analogy that was made to me about Google and it was it was

talking about the Americans in World War II that like we got every opportunity to ultimately do the right thing and come into the war and like help determine the outcome. And I think that was the analogy I had heard about Google with AI that like they have all the things to their advantage, be it the distribution of Google SEO, be it YouTube content, whatever it is, like the talent, the team, the dollars, all of that stuff to like figure this out ultimately. We'll see if that actually proves to be the case. But I do think that that is largely true of a lot of the incumbents in different sectors. And so the analogy that I think I used back then, I think it's still true is like, if you go back and look at the Salesforce of mobile, that was still Salesforce.

It was just like a mobile app of Salesforce. And if you go look and kind of go down the line, like how to Netflix or Facebook, there wasn't like a mobile Netflix. I mean, I guess you could say TikTok is mobile Netflix in some ways. But like there wasn't a pure play mobile Netflix, like a Quibi that came out and was actually disruptive. of in some ways. And there wasn't Facebook, maybe Instagram was the one that like kind of hopped on being that. But still, it was like, it wasn't totally net new surface areas that ended up manifesting themselves around that stuff, or at least it wasn't immediately in the fullness of time. Maybe it could have been if Instagram had stayed independent or if or if or what

TikTok's been able to do. I think that seems to be the case here today where we're going to see these things that are new and novel with an AI, and I draw akin to the Ubers or the WhatsApps or whatever it is, where these businesses that couldn't have been possible without AI are going to form a lot of independent equity value. But a lot of it's going to be captured by incumbents in some ways. And I think in mobile, Apple and Google probably captured the lion's share of like equity value that was created by the mobile iPhone or whatever. Like those were the ones that really through the app store and the actual phones. They captured a lot of it. And I think in large part, maybe with the exception of Open AI, like the vast majority of the equity value will probably end up accumulating to the Facebooks and the Microsofts and the, you know, the Googles and I guess Open AI as well.

But I still think we'll end up with hundreds of billions of dollars of equity value created for, you know, the derivative companies akin to the, yeah, to the Ubers and the WhatsApp and the whoever else. Yeah. I had this take I was noodling on yesterday about it feels like Apple's missing the AI moment, but. does it matter because Microsoft missed mobile and they still made it work? How do you feel things are going with Apple intelligence? Obviously, that John Gruber article kind of shook everyone to their core. Do you think they're in trouble or is it overhyped or where's the narrative sitting with you these days?

So the Gruber thing, I mean, obviously Gruber is like the goat of Apple coverage. And so you got to take everything he says almost like biblically in some ways. That's like the canonical gospel of Apple, you know, takes. But I have always hated Siri. Like I have always hated it. And then the Apple intelligence thing and the summarizations on the text, I mean, I love that. Only as a meme. Like, I enjoy screenshoting it and send me back to my friends.

That's the best use case of Apple intelligence I've seen. And so, like, when making fun of your product is like the best instantiastion. of your product. It's probably not, you know, you're not on a good trajectory there. Culturally, it just seals, and this is probably more, you know, John Gruber or Ben Thompson than what I profess to know about. But it just feels antithetical to Apple's culture to execute on AI in the way that I think you need to. They are very, like, measure. measure 35 times and cut once and let's do this all secretively and let's like try to control the ecosystem and keep everything like insular in some ways. And that is just so antithetical to

AI. And AI is about like proliferation and getting it out there and getting the data and taking the feedback loops and moving fast and trying new things and iterating. And like I just think that's directly at odds with who they are. And so I don't know how you change that. And does it, I guess to your question, does it actually matter? I don't know. They have such lock in, right? Is Apple, what is Apple's market cap today? I mean, is it like a trillion dollar business?

Sorry, three trillion dollar business? Yeah, 3.2 trillion. It's like, I think they're probably going to mess this up. And I'm not sure it's going to matter for them as a business. And I think the sooner they realize that they won't be able to execute on it, the sooner we get these things in our product as a, you know, a partnership rather than the APIs and let the, let the ecosystem flourish and, you know, let me change out the button for a different series.

Well, the other thing that nobody, but it's fine. It is, I still buy the, I still buy the phones. The other thing that nobody really talks about anymore because it just hasn't been possible as M&A. Yeah. Apple has so much cash. If there are breakout, you know, consumer, like products that make sense as part of the Apple ecosystem, there's a, there's a world in which they could actually just buy those

companies and, yeah, everyone quotes the 60 billion. their balance sheet or something, but Apple has returned over a trillion dollars of cash over the last like 14 years. Like it is a cash generating machine at a scale. I don't think we've ever seen their acquisitions. I think that's probably a better use of capital than what they bought to date. They have not been the best suppliers. You know, it's crazy though. I mean, they were, Siri was acquired for them like, I don't know, 13 years ago or something, 14. Like they were early on all of this stuff. And so clearly there's some like broken execution. elements, at least within, you know, how they've gone about it to date, which might not matter

in the grand scheme of it. It's a deterministic culture, not a probabilistic culture. And so it's misaligned with AI. I like that. That is very Ben Thompson or Ben Thubbins of you. I'm trying to be more pithy. Yeah, I like it. I like it. We got really no time left, but I wanted to give you an opportunity to talk about Ramp. When they announced the new fundraise, you kind of, like, we're poking a little bit of fun at yourself because you you did you basically uh you got found the local top but not the global top well and i think you invested a couple times during yeah yeah we invested a billion and then like three and a half and then eight or whatever eight two or something uh yeah it was uh it was a it was a long uh a long run from there funny enough that that round that we ended up investing in at whatever

eight billion or eight and a half or whatever it was uh what's a couple hundred million among friends but But that was like December 21 when we were talking about it. And then the round ultimately closed in January or February or something. And so it was really last boat off the island in terms of like internally the zero interest rate kind of mindset. And the thing that I've learned, and this has been the last five years for me, basically since I, so I joined Red Point in December of 19, officially started in March of 20. And what I realized is like price very rarely within some zone has mattered. And when I find myself iterating a little too much on like, I'll do it at this price versus that price, it probably says something about what I think the ultimate outcome

for the business can be. And when it's been, the investments that have worked the best are the ones in which I'm like, I don't know exactly how this is going to play out or where. the ceiling is on how this company can execute. But I just need to be in business with these people. And let's let's just see where it goes from there. And obviously, that's easier when you're talking hundreds of millions than it is low single digits, which is easier than high single digits, which is easier than double digit billion dollars. But like that mindset is one that I've, I've internalized where it ultimately says something about the quality of the company. If you really think

too, too hard about the difference between this price or that price. And so the funny thing about the investment was the entire time for the last three years, I was like telling our team internally is I don't know when this is going to stop growing or what the ceiling for this can be. And at some point, we're going to get to the other side of what that round was a couple of years ago. And so that was the first like public validation that it really felt like we had crossed that chasm a little bit. I think probably nine months ago, a year ago, it sort of felt like an inevitability that we weren't going to get stuck at, you know, some maximum that was beyond that. But yeah, I mean, the team just continues to execute at a level that I've never really seen before.

And I know you guys know them well. And so it's been a fun one for me to be a part of and kind of work alongside. Well, this conversation has been presented by Ramp, like every conversation. Go to ramp.com to sign up. You can use corporate cards. By the way, all my conversations quite literally are presented by Ramp. I feel my ability to do this job at this point is presented by Ramp in some capacity. So you guys have quite literally the ad play for it.

But they keep me in business as well. That's amazing. Thank you so much for coming on. When's your next, are you going to do, is this report, I feel like I see him twice a year? Or is it? Yeah. Once a year is usually, I mean, this one I think took a lot out of our team internally. There was a lot of late nights and weekends on this one.

So I think we're going to give our folks a little bit of time, a little bit of a respite before we run it back. But who knows? I mean, the market keeps up. We get more tariffs. We get things a little crazy. Maybe we'll need to come out of the woodwork. You know, when the theme music plays, you got to emerge.

For sure. Last question for you. We have Sam Lesson and Seth Rosenberg from Greylock coming on and slow. Coming on to debate AI in about an hour. Who's going to win? Let me give you guys a little bit of advice. As someone that has moderated a debate with Sam Lesson before, let me give you guys a little bit of, I would encourage, if you have mute buttons on

I would encourage you to jump in and try to steer the conversation. Don't be a passive participant in it. I remember this one. People tend to be really mean to you when you do that and you let the filibustering go on between him and let's say, I don't know, Zach Weinberg theoretically. So I would encourage you guys to be active participants in that conversation. We're excited. We've got our boxing gloves. We're going to throw them on.

We're going to get in the mix. Hey, guys. Keep up the great work. I'm a huge fan of what you guys are doing. I appreciate it. Anytime you want me, I'm here. Thanks a lot. Always welcome.

All right, guys. See you. Bye. Yeah, good fun. Did you? Yeah, we got to get the mute button. Have you seen that what he's referring to? With Zach Weinberg?

They were debating crypto. It was Sam Lesson versus Zach Weinberg. And Sam was making the case that like, every real assets should be on chain and your mortgage should be on chain. And like, this is the future. Everything will be crypto. And Zach is just like, okay, like, walk me through. through that at an extreme level of detail.

Like, how does this work legally? How do the taxes on the land work? Like, all these things. And they just went at it. And Sam was just going super, super hard, talking, talking, talk, and then he kept being like, I got to go because it's kid bedtime. Like, I really, I really got to go. But then he wouldn't let Zach get the last word.

So he'd want to, like, drop another filibuster on him. It was like really frustrating for everyone. And I guess people gave Logan some negative feedback because he wasn't, he wasn't aggressive on the moderation enough, but I thought it was a great. I found it very, very entertaining to watch. So I had a good time. Anyway, should we do some... Good time. Some posts, some ads, all of the above over the next few minutes before Keon joins us from Nucleus? Yes. The shot, the Chaser from X-O-R swap. The shot. Claude thinking and O-1 Pro have replaced all university instructors for me. I can no longer watch any pre-recorded videos. And then the

Chaser is, I bombed my second linear algebra midterm. Ouch. Two days later. That's so funny. And word grammar, friend of the show says math is best learned from textbooks and practice problems, not from Claude, but also not from lectures. So just hit the books. Hit the books.

Yeah, I remember I took a train up to Silicon Valley from Pasadena. It took me like 12 hours. But I had a textbook on natural language processing, like the pre-year. Recursor to LLMs, this was back in like 2012, 2013, and I just sat there and just read this whole textbook and taught me a lot. I really enjoyed it. Textbooks are underrated when it comes to getting potentially goaded when when learning is the vibe. Yeah, textbooks are goaded. No, I think the good thing for Sean is that the models are going to get better and the good thing about the real world is nobody really cares if you're using an LLM for specific answers as long as you can do a little bit of things. in yourself. Yeah, and you should be able to generate something. I mean, all the textbooks at this point have been scraped into these LLMs.

Like, you should be able to get the LLM to essentially just reproduce exactly the text that's in the textbook. Now, maybe that's IP infringement, but you can certainly get the facts. The question is, were you just sitting there chatting and making it feel like you were learning? It seems like you didn't actually get all the information into your brain. But good luck on your next midterm. Let's go to Paki McCormick.

He says, today, much of the global GDP is not computer. Soon, everything is computer. This is the opportunity. Funny because there's, it's true. But I was thinking about the everything's computer. Everything is computer thing. And I think I like the phrase more as a possessive than a contraction. So the actual quote is a contraction.

He was saying, everything is computer. is a computer basically. And then he dropped the A and it was everything, everything's computer. Everything's a computer. But I prefer the everything's computer as like, what is the computer of everything? It's like this like, you know, hive mind AI.

Like, yes, what we're building is everything's computer. It belongs to everything. And that just tells you like this, this very weird futuristic networked mega computer that controls everything. It sounds even more sci-fi at that point. Let's stay with Packy. Yeah, I mean, like one more thing on this.

I think this is the opportunity and why so many people that were traditionally software investors are excited about investing in hard tech or the real world as a category. When you look at some of the biggest recent outcomes, the sort of flock safeties, the anderals are these companies that have our software is critical to the business. Yet there's a major sort of real world component. Yeah. And, you know, I think that's just going to continue to be where some of the bigger outcomes are. Yeah, Teal had a good riff on this where he was like, I keep investing in companies that aren't the internet and then they make money from the internet. Like SpaceX. It's like a launch business, but Starlink is an internet company.

Yeah. And it's just like I keep going. It's like, you know, he's co-founder of OpenAI, eventually invested in the business. It's like it's a consumer internet company now. And like, maybe that's where the value is. And so there's all these weird things where you just keep coming back to the internet is this ultra-powerful force. And the more you align yourself with it. So capitalism and the economy just kind of naturally pulls every company towards that.

And, you know, flock safety is like, yeah, we're a camera manufacturer. But without the internet, our company would be worth way less. We originally wanted to be a newspaper. And everybody said, hey, technology. Hey, why don't you put this on the internet? Yeah. That's really the way to get ahead. Should we stay on Packy?

Let's stay on Packy. His breakdown. This was a week for the optimists. Devastating week for the pessimists. Devastating. He breaks it down in his fantastic newsletter. He says, solar and wind pass coal in the United States. That's a big milestone.

The United States continues to mug all in liquid natural gas exports. NASA launches a mission to study the sun. I like that. It's interesting. I don't know what they're trying to get out of that. I want to know more about what the goal of studying the sun is. They come back and they're just like, it's bright. So basically, you know how people started staring at the sun.

Oh, yeah, yeah, yeah, Huberman. The whole Austin crowd. Sure, sure. I don't think Huberman has recommended that. It was like, wake up, get some sunlight. It's like, get outside, get some sunlight. You know, people like, uh, circadian rhythm stuff. The, the sort of start of community in Austin, sort of staring at the sun directly.

Yep. Sort of maybe getting some benefit from that. NASA is basically saying, you know, we see some opportunity here. They haven't gone blind quite yet. We should maybe check it out ourselves. We should check it out ourselves. Gavin Newsom launched a podcast and Pachie says, Hear us out.

Yeah, so this was cool. Lulu's analysis of this was fantastic. Gavin Newsome. My read on Gavin Newsom is he'd maybe start a podcast and he would just have people that agreed with him on. He's taking the opposite approach. He's inviting basically his political enemies on the show. And it's very humanizing.

you know he's he's always been an incredible much better public speaker than he has been you know uh operator i would say sure sure like he's good with his words yeah and i think the strategy is really smart and uh i think you know you're you were you know when we started this show you probably said multiple times on the show like the person that does the most hours podcasting will win the election it's all about attention attention is all you need Gavin heard you say that that. Probably. He got the memo. The podcast election. No, but I think it's always smart. You know, the joke is like the world doesn't need more podcasts, but there still is white space and there's ways to come in and get an edge. And no one was doing this, which is an actual

election, reaching the divide. Talking across the aisle to some of the characters who have been labeled extreme. I mean, Steve Bannon is a very controversial issue, a very controversial figure, not normally platformed by even centrist media, mainstream media. But he, I think Bannon did a interview with The New York Times. The New York Times also had Mark Andreessen, who they've written very negatively about in the past. And they also had on Curtis Yarvin, who in the past has been extremely controversial and someone that was not platformed by the mainstream media, but something is certainly changing. Well, John, do you know what happened around five years ago?

What? California Governor Gavin Newsom was photographed wearing a Rolex Kermit. Wow. Which you can get on Bezle. Shop over 23,500 luxury watches, fully authenticated in-house by Bezels team of experts. Go to getbezzles.com. Shop around and find your next hitter. Apparently, Newsom is a Panorai guy.

Oh, really? But every now and then I'll step out. I think he's got a lot of attention, right? people kind of judge a lot of his fashion decisions he had these very sad time but he had this sort of like custom all this custom gear for the fire where he'd like pop up and be on yeah on camera and it was like really like you you got that like specifically stitched to kind of like larp as like a firefighter um is sometimes it works sometimes he's taking risks you know sometimes it works sometimes it doesn't yeah anyway we got keon from nucleus coming on the show soon

Let's check in with producer Ben and see if he's on. I think we got a couple more minutes. Let's move on to another post. Project Europe is a joke, says Arnie Ramesh. It's not the Teal Fellowship for Europe. If they take 6.6% equity for 200K, surprised. So many European founders are on board, maybe for visibility. $10 million fund size, L.O.L.

an average U.S. seed round. Make it non-delutive. Then I'm all for it. And Kari Saroni. It's a very European mindset to just. be like, just give away money. Yeah. Just give away money.

They get non-deluded. I mean, the Teal Fellowship is non-delutive because it's a nonprofit, but at the same time. Sure, but they're trying to. Asking for a handout. Yeah, they're trying to stimulate for-profit, you know, the founding of for-profit companies. Yeah, it's fine to just do it as a seed fund. It's fine. I don't know.

I haven't dug into it too much, but let's read this critique from Kari Sarin. This is a founder of Linear. Okay. I set up a linear account for us. to do some project management stuff yet, but we'll see if we get you on there. Okay. But I'll read through it. So Carrie, or Carrie says, I think your critique is overly harsh and frankly reflects the kind of attitude that holds Europe back.

Initiatives tend to get criticized unless they meet some impossible standard or align with absolute ideals set by someone. Is this the best deal globally? No, but by European standards, it's probably average. I see seed rounds at 20% for one to one and a half minutes. million led by reputable VCs. Personally, I'd rather raise less with simpler terms and go through these seed rounds, but everyone is their own economic actor and can decide which deals to take or pass on. Someone has to provide the capital, and there isn't the teals to provide the capital in Europe. You're also overlooking history in a lot of contexts. You're comparing something just starting now to YC,

which began 20 years ago. YC's original deal was 6% for 20K, and it stayed that way for a long time. none of the perks you mentioned even existed back then. What you got was PG's chili once a week and some advice. Priceless chili. When I went through YC in 2012, the deal was 7% for 125K. The whole premise of YC and whether the economics made sense was simply about whether it could make your company at least 7% more successful.

If Project Europe can do the same, then it's worth considering. Very interesting. I'm in favor of Project Europe. We've also been working on our own Project Europe internally at the show, which is going to Europe. Going to Europe, three months. South of France. Wine tour.

Doing the podcast. Spending lots of time on boats. Doing the podcast from the continent. You know, making Europe greater grand one show at a time. Spend 6.6% of your time in Europe. That's the real project, Europe. Anyway, we got Keon in the waiting room. Let's bring them in.

How you doing? Welcome to the Temple of Technology. What up? What's up, man? The Cuban pool against the mods of pods. I'm ready. John, I'm ready for you right now. Let's go. Let's go. It's great to talk to you. Great to see you. I don't think I've seen you in person since Miami. But give me the breakdown. Tell the, tell the fans who you are

and what, what nucleus is and then what you announced today. Yeah, so my name is Keon, founder of a company called Nuclecinomics, where the world's most advanced DNA health tests, single swap, single test. You can screen for over a thousand conditions. And today, oh my God, it's chaos in the headquarters in the best way. Okay, we have launched genetic matchmaking. Okay. So now you can family plan far more effectively. You can make sure every single couple in this country has healthy children. It is absolutely amazing. It's already blind up on Twitter.

John, have you seen the video? I have not seen the video. This is an Apple-esque video. Can you pull the video up right now? Can you pull the video up right now on Twitter? I will share it then and hopefully we can pull it up and watch it. Have you been in a relationship? Have you been testing this yourself?

Have you been getting on the app? Are you dog fooding this? Are you dog fooding this? I am dog fooding this real time. Let's go. It's funny because we were thinking about, like, should we block same sex couples or not, you know, because we figured that in the future, you should be able to independent of sex, you know, be able to have, you know, children. For now it is sex blocks. So it has to be male to female.

Sorry about a lot of tech pros out there. I know that might be hard for some of you guys. But when you find the one, when you find the special someone, you can do nucleus and it is going to be amazing. What is the actual flow for nucleus? Is it a cheek swab? I mail it in? Brick a swab. Yep.

You get a DNA kit that looks like this. Great. open it up inside there's a cheek swab you take the cheek swab you take it in a tube non-invasive you can do it at home no doctor's office involved goes to a laboratory laboratory process in DNA outcomes arrived DNA file which then we run through all our analysis uh which is honestly like a like this is people do not appreciate how much of a feat of science and engineering this is there's a couple people have to thank here first and foremost gregor mendel late 19th century let's go thank you for thank you for play with those peas yes he did not know what he's

this piece, you know, you know, he had like an extraordinary statistical intuition. You know, he had no idea what DNA was. He was completely abstracted. There's no molecular basis. Just playing with the peas. Went all the way to the Hershey Chase experiment, shot to that experiment, Watson, quick, and then find the structure of DNA. Of course, the human genome project, right, a massive government project, billions of dollars in investment, thousands of scientists. This product is now live in anyone's hands. It's a short line from Gregor Mendel in 1866 to nucleus being promoted at the Jake Paul fight. So, you know, if only he can see it now, we'd be great.

Ben, you're live streaming right now. Let's see if his video works. Yeah, we got the video here. This is a day I've been looking forward to for four and a half years. But really, today's product announcement is the culmination of decades of scientific, medical, and genomic progress spanning thousands of scientists and billions of dollars in investment. Hence today, I'm so excited to show you the next chapter of preventative health, family planning through genetic matching.

Imagine knowing every possible outcome for you and your partner's future children starting with their hereditary risks. Through nucleus, you have the power to end preventable disease in your future family long before you even decide to have children. To show you how easy this is, I'm going to sync my results with my good friend Molly O'Shea. Let's go. Hi Molly. Hey Molly, what's up? Perfect timing. I just opened up my nucleus to see my results.

I've got to say the UI looks really good. Oh, that's so nice. You know, we really spend as much time as possible to build beautiful products. And by the way, aren't you one of the first people who did nucleus? I mean, do you think maybe we're going to be a genetic match? Definitely. Let's find out. Seeing if you're a genetic match is almost as easy as seeing if you're a match on a dating app.

I'm going to show you exactly how. Here are my nucleus family results. which just came out. I haven't synced with Molly yet so you can actually see my kids may be at risk for cystic fibrosis But the only way to find if Molly and I are actually gonna pass down this risk to our kids is by syncing our results Let me show you how this works just click add partner and confirm that your partner's done nucleus Molly has of course so I click yes we're about to find out if we're a match. Molly, are you ready? Yep, let's see Oh my god we're a match this is amazing Molly, you're still there?

Shocking. I'm going to have to break up. Okay, well, we'll come back to Molly later, but let's see what just happened. On the back end, nucleus scanned our combined genomes for nearly a thousand conditions that we could have unknowingly passed down to our children. From here, Molly and I can dive deeper into the specifics of our results. In reality, nine out of ten parents have a genetic risk that they could pass down to their children. And one in 25 people have a genetic marker for cystic fibrosis.

So what would happen if Molly had a genetic marker for cystic fibrosis? We have good news. We've been hard at work for something that we think will fundamentally change family planning forever. We can't share too much yet, but imagine if you could learn not just about the diseases you could pass down to your children, but also where they're going to look and act more like mom or dad. more on that soon. At Nuclease, we believe that anyone anywhere should have the choice to access genetic insights to make more informed decisions about their health.

Okay, so the big question, do we have them back? Yeah, yeah, yeah. You there? I think we got to unmute him. Let's see. We're juggling things. Can we hear you? Can we hear you?

Can you hear me? Yep, fantastic. The big question. First thing, how was that video? Huh? It goes hard, right? It goes hard. It goes hard.

Very clear. Very clear. I really liked how efficiently everything's communicated. The transition are cool, but it's not all style. There's substance there. Very well executed. Good job. When the big question, John and I are both married.

But if somebody, if one of our listeners is dating, you know, somebody, when's the right time to say, all right? Pull out, like, let me see your cheek. You got to do a quick swab. We got to do a swab. Look, look, look, look. There's many ways in doing this, right? If you're dating someone already, it's okay. you know, you do nucleus, you see if you have a genetic risk or not.

If you're, if you both have a genetic risk for the same thing, you can do IVF, there's other reproductive options, you're going to be good. You know the risk exists so you can prevent the risk. The whole point of genetics, right? But also there's a world where, listen, maybe you're a tech route. They listen to this podcast. You don't have the special someone yet. No worries.

You sit down and you say, you know, what college you go to, you know, they tell you, whatever. You say, okay, nice. You know, what do you do? You know, and then you say, have you done a nucleus test? There you go. There you go. I mean, you've got to break it to them.

You got to say, listen, you got to make sure the genes are aligned because why would you get into this business in the first place? You want to get deeper into it if the genetics are not matched, right? I mean, you don't want to be cared for the same thing. Do you see people thrown up their nucleus results like on dating apps? Like just look at these genes. I think that's the future, maybe. What do you think? I mean, I think I think we believe in kind of individual liberty.

I think genetics should be integrated with dating apps. And if someone, you know, opts in and should say, hey, I don't be matched with someone that's also care for a rare genetic marker. It's actually done in different communities, the Asconology, Jewish community. They do this all the time. I'm actually not mass people who are the same very genetic marker. So 100%. I think you should integrate dating apps, do mass preconception testing. DNA is becoming, as you guys know, cheaper and cheaper and cheaper.

One of the greatest decrease in costs ever. Combining that with AI, there's going to be magic, mass integration with different dating apps. I think you're able to save a lot of baby's lives. What about flipping it around? Obviously, the genetic markers for diseases are very, you know, you want to avoid those. But, you know, I already have kids, but I could imagine that my son, when he goes to have his own child, my future grandchildren, might want to optimize for a grandchild who's going to be a future bodybuilder, let's say. And we want to make sure that, you know, they're just matched up so they can

go to the Arnold. The most proud grandpa ever. And just absolutely look diced, you know, massive, put on 300 pounds of pure muscle. And he wants to make sure that his wife is setting their kids up for success. Will Nuclius help with that? Great question. So first thing first I'll say is, John, He has a good father because you're like seven foot tall. The genes are good. The genes are good. He already has already inherently. He's good there.

But, you know, it's funny you actually ask this because at the end of the video there, you know, I left a little teaser in there about something that's coming out. Let's just say, you know, there's something about, you know, maybe, you don't want to just simulate people's disease risk, but also maybe you want to simulate what your baby's going to look and to act like. Oh, cool. You know, when you start thinking about whole genome sequencing, you can start maybe thinking about can you actually simulate procreation.

Oh, wink, nudge, nudge. And let's just say, you know, John, we're shipping. We're shipping like crazy. It's like hysteria in the nucleus headquarters. I love it. We're building at the frontier genetics. You know, I hear like sirens going off, gongs being hit. It's complete chaos in here.

Yeah. So it feels like, you know, I think that the consensus now is a 23 and me walk so you guys could take us to the moon. Like what, like how far can you take this, right? because like the first step is like giving people the data and then you're then you're trying to like influence outcomes like how how much does the sort of nucleus platform expand what is the like 10 trillion vision for the business because I know you're that ambitious yeah so you know it's like blockbuster versus Netflix it's like you know blackberry iPhone that's the moment that's happening in genomics right now and the beauty of the genome what everyone's starting to appreciate is that the basically more

of engineering and science and it is because if you think about it when you actually read someone's entire genome, it's not just disease risk assessments that you can actually think about. It starts to be talking about family planning, about procreation simulation, about what drugs actually work best for you, what supplements work best for you, and even about the long tail of different traits that you can analyze from IQ all the way to muscle strength. You start realizing that the integration of the genome simply has not happened yet in society. If you take a poll of, you know, 300 million Americans and look at how many have been sequenced, right? Basically, none of them have. And you're talking about one of the greatest innovations ever, which is the decrease in causation

the genome, by far the single highest density, highest consequential piece of health information that exists because it's literally your DNA, it's the entire thing. And it's not integrated in medicine, in lifestyle, or in dating. I mean, the opportunity is massive. And this test today costs $400. I'll make a prediction right here on technology brothers within five years. This test, a couple dollars, I said. A couple dollars. Amazing, amazing, amazing. Congratulations. Where can people get it? So, so last question, is, are we going to have a way to test if somebody's nice with it or got that dog in them or is cracked because you seem like you're definitely nice with it. You definitely have that dog and you see cracked. So we have found consistently,

okay, that founders who do nucleus tend to be very high in their schizophrenic disposition. Okay, so personally I'm in the 99 percentile. I'm rocking it. Maybe I'm seeing shit. I'm telling you right now. Schizo chat. That's how good. I swear, you look at Alexis. Shots by me, Alexis, one of our lead investors, super high schizophrenic. A lot of other. founders I know super high schizophrenia. And that's public, by the way. That's public, by the way. I'm not just exposed to Alexis.

Alexis results are public. I would never just expose. Okay. Good job. Go look at all those results. Shout to Alexis there. And so if you want, you got to look to see it's confronting. In fact, one interesting study showed that they ran these different models across every

single phenotype and they compared it across different careers. By far, the highest predictive one was actually schizophrenia. But it was for artists, which is very similar to entrepreneurs though. So, you know, that's something to do. If you're low ADHD, super low ADHD, especially with doctors and lawyers. So you know, there's something there's something there. You know, you got that dog in you, maybe it's a new DNA. I love it.

I love it. Well, where can people go get it? Where can people order a test? Mynucleus.com. Mynucleus.com slash family. If you're a couple, you want to have healthy children, that's where you should go. Fantastic. Tians is 95.

Follow me on Twitter. Yeah, Twitter is going to be fun. You're amazing. You're amazing. This was fun. I've actually, we've never talked. And I'd love to have you back on whenever there's, whenever there's genome news, just just join this exact link.

Like, don't even, you don't even tell us. Hey, there's news. You tell us. Yeah. Amazing, man. Well, congratulations on the little launch. We'll talk to you soon. Talk soon. Have a great day.

Nice, guys. Bye. Have a good weekend, too. Amazing. I think genetics might explain why a single inorganic blueberry would kill you on the spot, and yet I could eat a credit card with a fork and knife and just be unaffected. So I think we got Josh Steinman coming in. Speaking of microplastic haters.

Yo. Yo. How are you doing? Good, good. Welcome to the show. We got Josh Steinman in the building, in the Temple of Technology. Give us an update. Is it a good morning and are we going to win?

All signs point to yes. Oh, fantastic. Fantastic. How's it going? It's good. It's good. How are you guys? You want to know, you want a little show lore?

I definitely put one of your initial Good Morning, we were going to win posts into the stack. in the early days. And then I put another one in about a week later. And John was like, wait, you put this back in? I'm like, yeah, we're still winning. It's still a good morning to remember. And so we've done those tweets like three times already. And I've talked about it on the show before.

I think there's this, you know, founders will say something once and feel like they've said it. And you're not realizing that, you know, a lot of the long, the return is in the sort of long tail of just drilling this idea. And I really feel like it's become movement. This is the David Senra thing. You're not advertising to a standing army. You're advertising to a marching parade. Yeah.

Yeah, it's interesting because, you know, part of it is self-talk, right? And this goes into like the deep, like how do we program ourselves? Yeah. Like human as computer. Scott Adams talks about this, the Moist Robot hypothesis. But other people as well, his school of persuasion is the same school that Bill Clinton and Tony Robbins come from. like Norman Vincent Peel like there's a lineage here. So it's like how do we talk to ourselves as people?

How do we talk to ourselves as agents, free agents, like in the world? So part of it is just like I'm telling myself every day. Like you have to wake up and you have to like want it every day. And then the other part is just like obviously, you know, with the with with the public persona that I have, you know, having come from, you know, both the military but then also politics. like man it was dark for a while you know like super dark and I just wanted something where I just could say to myself every day like look things can turn around and I actually think they're going to and certainly they have but like every day just wake up and be willing to just like offer yourself up to the universe like yeah it's going to happen like we're going to win like you're never more than one one day away from like catastrophic success uh going back catastrophic success I like that term Going back to your dark days, do you feel like you got a lot of, like, were people turning down meetings with your company early on just because of your sort of political leanings? Should you do some backstory on the company? Can you break down? Yeah, yeah, maybe we should start.

What you're building who you are, a little career highlights. I mean, yeah, I'm sure a lot of people know, but give us the basics. Yeah, so I started off my career in like this weird corner of operational counterterrorism in the U.S. military, that sort of branched into high technology and high technology strategy. Again, when I was still in uniform and got a lot of exposure to just how much, you know, the world is a very interconnected place. And there are things that we can do in the digital world that absolutely affect the physical world. People talk about Stuxnet. They talk about, you know, these attacks that have happened against oil facilities. So I get out of the military, I go to Silicon Valley, and then two years later, just like a strange series of coincidences, I get asked to come back to Washington and essentially be like the most senior cybersecurity person in the U.S. government.

Not like I'm going to reset your password, but like I'm going to remake our entire practice of running cyber operations for like the DOD and the intelligence community and Homeland Security and all that stuff. So I did that job for four years. and then afterwards pulled together two buddies of mine, including Brandon Park, who helped stand up Amazon's global, what we call operational technology OT cybersecurity program at Amazon, and then Felix Plushinsky, who I'd recruited to come join me in the admin, who was a hedge fund trader. And we started looking at this problem. It's a huge problem. You know, we've digitized the industrial world, and yet there's, it has created these huge vulnerabilities that have been exploited.

and some of that stuff makes its way out into the public. So, yeah, we just wanted to start a company to solve that. What percentage actually gets public versus is sort of known among the industry, but not necessarily in headlines? Yeah, are there foreign agents operating on American soil? Because I hear some people say the number is zero, but I think you had a different point. Right. It's a different meme of mine.

Yeah, no, there's absolutely foreign sabotage teams operating on you. us soil 100%. My actual number is somewhere around 100 teams. My guess is that, and the question is like you could break that down into, you know, what types. Anyway, yeah, most of it doesn't get public. And, you know, sitting in that chair for four years, I had to get the classified reports every day of like, oh, this thing happened, that thing happened. And it just didn't drive me nuts, but it was like, man, it makes the hair on the back of your neck stand up. Are there any cybersecurity stories and history that are public, now that you like to point to is like that could have been prevented. That's the one we're

learning from. And here's how my company would prevent that essentially. Or here's how I would have stopped that. Yeah, too easy. So I think two, three years ago, uh, somewhat, I don't know who, I don't know who, um, literally destroyed the Iranian steel industry in like one day. Really? There's video out. Yeah, there's video out there. Like they literally took over, you know, the refineries and just started pouring. liquid metal all over the floor on a bunch of these, a bunch of these facilities. Yeah, there's a bunch of incidents like that that have happened. So walk me through how you would prevent that.

I mean, I imagine what you're describing is like remote takeover of a machine that is connected to the internet or maybe air gapped and they didn't have the right security there. How do you actually step in and prevent that for our steel industry? Air gaping. I mean, a lot of people will say that stuff because they've heard it on like TV or whatever. That's me. That's me. Yeah, exactly. But these operations take days, weeks, months, sometimes years to sort of like get into a network and then find your way to the systems that you want to take over. And the whole point is like every step of the way of those types of operations leaves breadcrumbs. And so currently the way in which people try and protect these networks is by looking at only one area of technology inside the four walls of the facility and that's like the networking equipment. So what we do is we look at every. We look at every network. everything. And so by looking at everything, you just have a bigger picture and you can assemble

a narrative. You can try and understand when malicious things are happening at that super high level because you're seeing what's going on with the engineering workstations. You're seeing, we are seeing what happens with the network. We're seeing what's being done on the applications. We're seeing what's happening, you know, the firewalls. Yeah. So we just take it all in and, you know, it's not, it's not new. to like, oh, do something with a much bigger data set. That's really what we're doing. Can you break down some of the difference between espionage projects and sabotage projects?

Are there any differences? Are there any risks, you know, state actors that are prioritizing one over the other right now? Yeah, this is like the thing that most people don't understand. They'll say like, oh, you know, things that are happening right now, it's just espionage. The thing is, like, in the course of an operation, like, you do the espionage first. It allows you to map the network, map the systems, and then sometimes people will like just leave a little, leave a little something there. In case they want to do sabotage later. Yep.

Pop it. Okay. So like, there's like lots of espionage happening on critical networks. Like, gee, what's that preparation for? Sure. That makes sense. What's been your read on our response to DeepSeek broadly? Do you think that U.S. companies have been taken?

taking it seriously enough. There's this, you know, general lens from some, some of the tech community that says it's, you know, it's open source, you know, it's not sort of the same type of risk as TikTok. What's your read on it? Yeah. Look, a major frustration that I have is that we get a bunch of these cutting edge companies. And then, you know, almost certainly you have foreign actors, not just the Chinese, like many other foreign actors that come in. I mean, you can read the papers that came out of like the Twitter buyout, you know, transition to X. And they basically are like, yeah, we had foreign internet internet foreign intel services, foreign governments, like operating inside, you know,

X formerly known as Twitter. I think that's happening in a bunch of our companies. I think it's a huge problem, huge counterintelligence problem. Because the question is like, what are they manipulating? Like, are they putting back doors in there? Are they changing content? Are they changing, you don't know. And a lot of the companies, many of which my friends have worked at, they don't even have a way to think about this. And also, obviously, like, it's not politically correct to talk about, hey, maybe we shouldn't hire that foreign national that went to the, like, you know, military college of their respective nation and whose uncle is like the deputy chief of their intel service. Yeah. So speaking, the new CEO of Indeal Service. And so speaking, the new CEO of

that got announced today, you know, we covered this earlier on the show. You may not have seen it, has invested over the last, you know, 20 years, hundreds of millions of dollars into, you know, Chinese tech companies. Do you foresee any sort of like pushback into bring somebody like that on to run, you know, he's not a Chinese national, but. Born Malaysia, grew up in Singapore, but invested in the Chinese semiconductor company, exited the position in 2022, I believe. and now running Intel. Look, you know, I don't know the situation specifically. Obviously, Chinese companies are legally required to be dual use.

Like, they've architected their entire economy to serve the Chinese Communist Party. It just means that I'm super wary whenever you see folks that have been allowed to make profit out of that system. I don't know his scenario specifically running Intel. I certainly hope that, you know, I certainly hope that everything's on the up and up. I have no reason to think that it's not. But whenever I look at, you know, those types of interactions between, you know, what I think the United States and Western allies would call like the free market and the Chinese Communist Party, I'm just super wary as a whole.

Staying on the topic of China, do you think we've learned at all from the sort of DGI just sort of blitzing and taking the entire U.S. drone market, do you think there's a real risk that they're able to run that same playbook back with Unitri and the sort of human aid space? Or are we going to be smart enough to not let them put a robot in every American's home? They are absolutely taking that. They're absolutely taking that playbook and trying to replicate it as broadly as possible. For years, I've been telling, screaming anyone that'll listen on X or wherever else,

like we should ban DJI from doing business in the United States. Full stop. full stop. Everyone's like, oh, all the alternatives are like more expensive or this, that, and the other. But yeah, supply and demand will allow the market to correct over time. But it's a huge problem. Like, they exactly know. By the way, like, if you don't think that senior CCP intel officials have the ability to just walk into DJI headquarters and be like, give me everything you know about the topography of the United States. Like, you're smoking crack. They probably have access to it right now.

So every time these things fly, anything that get transmitted into the cloud, whose cloud is it? Where is that cloud located? You know, what access do the Chinese intel services have to it, military have to it? Like, yeah, all that stuff's like in the wild. What about personal cybersecurity? What do you recommend to the average listener just to kind of beef up your own opsack? Yeah, it's tough. So for normal folks, I just say use the big cloud, use the big providers.

That's like the Googles, the Microsofts, et cetera, enable two-factor authentication. I think probably the biggest thing that I don't hear a lot is whenever you get a message, like an email saying like, hey, like your bank says this or that, delete the email and then go straight to log into the service. Sure, sure, sure. And that's like the mind space that you want to be in because like these guys are social engineers. They know the language to get you to click the link. And that's what they're trying to do. They're going to put delicious software onto your laptop, onto your phone, whatever. Tons of phishing attacks at X right now.

And those are getting more and more convincing. You've seen some people leak it out, usually just for meme coins launches basically. But you can imagine being much worse. Famed investor Kleiner Perkins launched a meme. I want to I want to there's a couple topics I want to get through one you know I'm sure you can only make sort of general predictions here but do you think this whole TikTok thing gets resolved in the next month you know there's sort of there there was an initial date for early April that it was supposed to you know sort of change hands but you just we haven't been

seeing that much new news about it at this point there's plenty of people that want to buy at, you know, Oracle, Microsoft, Alexis O'Hanian, like, there's so many different capital groups, like, chomping at the bit to, you know, be the by side on this deal. It's just a question of, can you twist their arm enough to get the sale done, I think? But what do you think, Josh? Yeah, they absolutely want to retain control of the algorithm because that's, like, the prize, is the ability to, like, inject ideas into the youth of the United States or elsewhere in the world. And so I think that's going to be, I hope that's a major sticking point with the way in which resolves out at the same time, you have to remember that this deal has the attention of the

president of the United States, who is at the same time negotiating with his counterparty, Xi Jinping, over a trade relationship that, you know, there are trillions of dollars in the offing around it. And so I learned this over four years of working for him. Like, you just have to trust the boss. He's playing a game that like very few humans have ever been able to play, which is like, the most high risk, the most, you know, impactful game of like one nation in the world. And so, look, I hope he's able to negotiate it in a way in which, you know, preserves cognitive sovereignty. There's a lot going on. And I've sort of taken my foot off the gas on it. Yeah, yeah, it's not a focus. Let's kind of pivot to.

a topic that's, you know, definitely, I'm sure, top of mind for you guys. Re-industrialization, the vibes are good. The work is, you know, maybe starting. It feels like it's starting. It's certainly ongoing. Jobs not finished. Are we doing enough? It seems like there's a, you know, sort of top, there obviously is a top-down directive to invest in America. but, you know, there's been, you know, on the topic of China, China will give, you know, companies, you know, very, very low or zero interest rate loans to do development. We're not quite there yet. I think Deepseek's taking one of those. Yeah, yeah.

Deepseek turned down all their venture capital interest and said, yeah, we're just going to take a zero percent loan from the bank of China. I love it. So, yeah, like, it doesn't, it's almost like it's not an impossible task, but it's a very, difficult one. Are we doing enough? Do we need to do more? What's your take? Yeah. So in my four years of the White House, I ended up taking over this portfolio, not we're not even taking over, but owning this portfolio of like technology supply chains. And it's hard. You know, the Chinese are literally, just like you guys have said, they're out there giving these zero percent loans, these companies to try and build what

they call national champions. And so, and so. And so. How do we compete? I think the answer is just the market, you know, and I don't mean that in a sort of like lame kind of way, like, oh, the free market will take care of it. But like there is an incredible amount of dynamism in the American system and in the American markets. So like the Chinese can certainly go out and try and drive attention or monopoly towards their chosen, you know, national champions. But we've got a bunch of people that want to make a ton of money here in the United States, a bunch of people from around the world that come here because they want to make a ton of money here in the United States, I think that presents us with different

advantages. And so I think that when it comes to financing, there are lots of tools in the toolbox. There's the Defense Production Act. There's, you know, DOD procurement. There's a whole bunch of things. I do know that the team right now is thinking about all of them. Again, having sat in the seat, you know, I'm not going to take shots at anyone. Not that I have any shots to take. Just that, like, I'm confident that they're thinking about it. I'm confident that they know, you know, what's available. And I think we're seeing great stuff already. What do you think about the debate between supply side and demand side stimulus in these projects?

Like the Chips Act, obviously, $50 billion, I think $8 billion was going to go to Intel, provided some milestones. But Ben Thompson has been advocating for flipping that around and instead just saying, hey, let's have the, the U.S. government say, we're buying chips that are made in America. If you show up with chips that are made in America, we are the buyer. And then maybe someone else will buy them. Maybe Google will buy them. Maybe Apple will buy them. But you can guarantee that there's demand, but we don't care about what's happening

on the supply side as long as it's happening in America. Do you like that change? Do you like that V2 thinking? Yeah, I love it. I love it. I think, you know, right now, I've heard a lot of strange things about how Chips Act has played out. I haven't followed it as closely as. as if I was, you know, some analyst covering this stuff for the banks.

But I mean, it was one of the approaches that we pushed was this like, look, you just have to have it made to America. That's it. Again, show up and buy. Yep. That's one of the things on the table and I hope they do it. That's cool. What's just pivoting back? I don't know if you're in California right now or up at the northern office, but how do we solve the wildfire crisis in California, right?

It's this sort of very complicated issue. You've worked in government. You're very in tune with what's happening in hard tech. It feels like there's a public role to play. There's a private markets role to play. There's obviously the whole insurance side. But you're sticking it out here in California, I hope. So what's your position on what we need to do as a state?

I mean, we've got to let the forcery guys actually operate. You know, it's insane to hear them. talk about like what was going on in Altadino where like years it took them to file these crazy applications with like 15 different state boards letting them do controlled burns and brush clearing and they'd get said no to like we just got to let these guys do their job like forestry management is a solved problem right let these guys get out there the Europeans laugh at us the president talks about this all the time but it is literally true they don't have these types of catastrophic forest fires because they have good forestry management.

There's an amazing account. Man, M-A-N-N made films on Twitter. You've seen this guy? He did a film. He took a red camera and he became one of these, what are the fire, the smoke jumpers. Oh, wow. Smoke jumper.

And he did this amazing film. Follow him on X. but he talks about it. It's like, look, yeah, these places are prone to fire, but if you let the forestry management folks do their job, like, you know, you can manage it. And the same thing with the water stuff. Like, the solutions are known.

Like, there's weird blockages in the way in which water comes into California. And the president's trying to deal with some of that stuff. Like, the state of California, like, people know what the answer is. They're just not being allowed to do it because crazy weird bureaucracies. That's right. The movie was called Hot Shot. I remember seeing a trailer for this and being blown away by the visuals. I need to watch this movie.

This looks fantastic. Available on Amazon Prime, Apple, Google Play. Go check it out, folks. Anything else? I think that's all I got. Thanks for stopping by. I'd love to, you know, we'd love to have you on when, you know, there's a bunch of these topics. Cybersecurity correspondent.

You're our new cybersecurity correspondent or brother, depending on. Or just a morning pump up speech. Yeah. Just hop on. Just tell us good morning. we're going to win that you can hop off get to the rest of your day we've been starting the show with by singing a little bit so if you ever want to like you know create like an anthem or yeah we need we need we need good mantras we need good mantras we have a few temple of technology fortress of finance capital

of capital but good morning we're going to win works too see yes thanks for coming on thanks for coming on great cool we have five minutes until let's hit a couple posts let's hit a couple posts what do we have in the queue We went through. Oh, so this is a crazy story from this account, Rob. Rob Wiblin. So he says, this is a tiny niche story, but it may actually be the most catastrophic thing to happen globally yesterday. Bold start. Bold start.

I'm not going to go out on that with him. We'll be the judge of that. We will desperately need politicians. Okay, so the headline here is that this media company new scientist has used the freedom of information laws to obtain the chat GPT records of Peter Kyle, the UK's technology. secretary in what is believed to be a first world first use of such legislation. Interesting. So Rob here says we will desperately need politicians to be able to use AI advisors to keep up with the intense pace of events that recursively self-improving AI agents will bring.

AI advice will improve in scale proportionately to the social impact AI is having given government some shot at keeping up. But if any conversation with AI can be extracted using freedom of information laws, while advice from humans given verbally cannot, politicians and civil servants will be hugely biased towards worse and slower human advice and analysis. They'll fear looking stupid for asking clarifying question or outrage if the AI advises some un-PC course of action. Just as we need humans in government to be able to have some private conversations, we need humans to be able to get AI advice without journalists being able to publish the transcript. these conversations must be carved out of F-O-I legislation.

So anyways, interesting point. Yeah, you know, you want politicians have a lot of pressure, they have hard jobs, you want them to be able to like, you know, have their little friend companion. Like maybe they're using ovies. It's like sometimes it might just say, you've got this.

You know, but other times they might ask, you know, hey, you need to brush up on your linear algebra. Yeah, like what is, what's this maximum speed limit? Yes. He didn't know. He didn't know. He should have known that. Yeah, that's interesting.

I wonder, I mean, there are ways to use LLMs in more secure and less foyerable ways. I mean, certainly you can run your own Lama or deep seek instance on a computer. George Hatz has a project Tiny Box. But, I mean, even if you just have a, you know, a new generation Mac. it's now big enough that you can run and powerful enough and the models have been condensed enough that you can run them locally. That obviously makes it harder for them to be seized

without your permission. Also, you could see an LLM or an AI service basically built on top of something like Signal where there's end-to-end encryption where if you're using an unencrypted network, the government can go and ask the tech company, company to, they have the keys so they can unlock the servers and pass over the records. But that's not the way it works on Signal and other end-to-end encrypted communication apps.

So you could imagine a world where someone is vending an LLM through an end-to-end encrypted service, not saving the records and offering a different service. It feels like a niche but potentially important use case. But it'll be interesting to see where it goes. I mean, this is actually maybe the bull case for Apple because, Apple's whole thing has been end-to-end encryption everywhere, including the messages app. If I'm talking to you on iMessage, Apple cannot see those. And even if the FBI shows up and says, we have a warrant, unlock John and Jordy's latest memes,

we want to read them. They've been posting bangers back and forth. We want to access them. Apple doesn't have the keys. And Apple, if they're running the LLM locally on your device, it's locked behind your pass code. But is that true for if a government employee has a government, phone shouldn't if the government be able to like see that itself. Yep.

Yeah. I mean, if you have, if you have the pass code to get into the phone, you have full access. So it needs to be on a personal device that can't be monitored in order to truly. Yeah, but then of course the flip side is that then, you know, bad actors can use the encrypted.

And this has been the privacy debate forever. Yeah. Yeah. Yeah. And Open AI has historically just been very careful around anything, um, anything political. They don't want to be positioned as, you know,

Open AI influence the selection or things like that, but these are some of the big problems that they're going to have to... Let's go to Blake Robbins. He has some random thoughts. We love these posts from Blake. He says, there might be an entirely new generation that now thinks of Nokia as a Drake song. That's funny.

Two, sort of insane how much mobile games like Candy Crush leverage haptics. So as you're using the game, it's vibrating. Kind of an underrated way to increase engagement. and I guess decrease regretted user seconds or just keep people addicted. And then number three, whoever runs stakes clipping strategy slash network

is on a different level playing 4D chess. I'm sure you've seen those stake ads all over. Yeah, so the thing that's been relevant to X is they've taken over or they're partnering with these accounts that post these viral videos. Viral videos and or just posts, images, things like that, and slop. And if you look at the bottom,

it'll say like this, post is presented by steak so it's like very kind of just a tiny logo you're getting it's not in full ad it's just state logo and and and every time one of those goes viral there's a community note this is against the terms of service you can't promote this this is undisclosed ad but they still goes viral still gets a ton of impressions yeah i had a fourth random and it's funny well so he's bringing up steak steak steak steak has like this massive partnership with drake and oh yeah they do they keep doing like stumps steak and drake steak and drake no but i mean the the very very the funny thing is in this one post you have him calling out that a whole new generation doesn't

realize Nokia as a Drake song, which implies that and Drake partnering with steak means that Drake is just marketing, you know, basically gambling products to the youth. And he should clean it up. She should look in the mirror. Clean it up. Well, I have a fourth random thought here. You should get an eight sleep. Knights that fuel your best days, turn any bed into the ultimate sleeping experience. Go to 8Sleep.com slash TbPN and get $350 off the pod. I slept very well last night, which I'm glad I got a 98 because this debate

is about to be tense. It's going to be difficult. It all could come crash down. I got a 94. You beat me. Good night. I slept a lot. Good night for you.

Nine hours, 21 minutes. How is that even possible? That's a long time. I mean, you're. I put up some crazy numbers. You put up some crazy numbers. And, uh, and, uh, and, but you got to be well rested for these debates. They're hot.

They're aggressive. I wouldn't be surprised if, so lesson is not in the waiting room yet. Okay. I guess Seth is, but, uh, I wouldn't be surprised if Sam was just taking a power nap on I wouldn't be surprised, yeah, uh, you know, to just sort of get really into that sort of should we bring in, Seth, do some pregame strategy? I want to hear a strategy. I want to hear how he's thinking about, uh, going toe to toe.

let's bring them in into the temple of technology the fortress of finance hey good to see you welcome to the stream how you doing oh you got the custom background with the billboard there yeah i'm starting with a little psychological warfare okay that's that's my strategy just get them get them a little uncomfortable yeah what does it say it says lesson south shoot lesson a message not set green Yeah. It's very AI generated. It says, it says got a weird meme coin, shoot less than a message.

Oh, okay. Okay, okay. It's cut off over here. But yeah, give us the breakdown. How did we wind up here? So about a year ago or maybe six months ago, Leson and I had a public debate about, you know, is the AI opportunity for startups or incumbents? Yep.

And it got heated. Um, and so yeah, we've kind of just been going back and forth. And then, and then he actually took out a physical billboard on the 101, like, with all, like amongst all of these like advertisements for AI companies that says, AI is not your moat like love slow kind of thing. Yep. And then I just kind of tweeted back at him saying, I'm going to like take out a billboard on the other side.

Okay. And then they actually. Yeah. Yeah. So then he, he, he lessened through up a new ad yesterday that says got an AI startup idea, shoot Seth Rosenberg a message, not slow. So this is basically the Drake and Kendrick of allocators. Yep. And the Tupac Biggie of this era. Exactly. No, but it's great, it's great to have you on. Sam's a fierce debater. We were talking with Logan Bartlett earlier. He's moderated

debate before. So we're going to try to keep it. I'm going to try to keep it very, very simple. Keep it tight. Keep it tight. Because he's known to filibuster a little bit when you get him That's right. Yeah. So you got to help me and just cut Sam off. Okay. Yeah, yeah, yeah. Well, I mean, he might not even show up and then you win by default.

Yeah, exactly. That's good. It's a forfeit. Yeah. What, uh, yeah, why don't like, since we have some time, why don't introduce yourself, some background, uh, for the, for the listeners. Sure. Well, so Sam actually hired me at Facebook in 2013.

No way. So we've gone way back. Crazy Lord. Wow. Yeah, exactly. So I was like this young. Analyst at Goldman Sachs like spending 100 hours a week in spreadsheets. And then Sam invited me to this backroom dinner in New York talking about the future of the world.

And this is back when Facebook had a little less baggage. It was still like a startup energy, like future the world, giving individuals a voice like Arab Spring, all that. And I was just super inspired by it. And so it was like a four hour of dinner conversation. I'm like Sam like I definitely like that was the first time I met him. But you know, he's quirky and futuristic. And so I'm like, I need to do this. So I spent like any spare time I had like learning how to code and just like getting up to speed on tech world.

And then I've just been in that world ever since. How long were you at Facebook? Yeah. I was there for about four years. I led this separation of Messenger into its own app. And then David Marcus came on to lead it and Stan came on and built kind of an empire around it. And then I was running. Post Project Titan?

Because it wasn't Titan like the whole project to like put everything together and then That was after I left. That was after I left. This was the opposite of that. The separation. Yeah. This was back when it was like Facebook chat. That's the game at a hyperscale.

You just break it apart, put it back together. Put it back to get it. For the whole employment for PMs in the valley. Yeah, exactly. So I was there for phase one. Okay. And then you went straight to Greylock or what was your next move? No, no.

So I was running the product for the developer platform at Facebook, which was like AI bots, Messenger bots. It's like the hottest thing in Silicon Valley for like four months before everyone realized it didn't work because we were seven years away from LOM's actually, you know, being released. Yeah, I know those bots. Lots of business logic. Lots of if then statements. Exactly. Dressed up with a nice UI every once in a while.

All right. We got your former, your former boss or at least a guy that hired you is in the waiting room now. So we can bring them in and bring them into the temple of technology. The fortress of finance. It's the capital of capital. And if they, if they get out of hand, I'm going to be ringing this gong telling you, hurry it up, finish what you're saying. No filibustering on this debate. Sam, you almost forfeited by being late.

I was in the waiting room. I'm sitting there. I wore my team Canada, Canadian team Canada like architectics for you, Seth. Yeah, thank you. I appreciate that. I support your 51st state. Yeah. I'm American now. I kind of support it to you, honestly.

There you go. That's great. Well, welcome to the stream. Welcome to the debate. Should we do some opening arguments? Lay down the general. What is the actual point that we're debating here? Sustaining versus disruptive innovation for artificial intelligence? Is that kind of where you guys are differing the most? I think the debate is that Sam has too much disposable income to waste on billboards. Oh, okay. Yeah, so Sam, what's the art? How are I been so far? Are you...

I don't know, Seth. How many AI pitches have you gotten from my billboard? Actually, honestly, like the inbox is full. There you go. You're welcome. You're welcome. I see no debate here. I'm very happy to send Seth all the AI pitches and life is good.

And to be clear, this debate is presented by AdQuick, the number one way to buy billboards on the 101. Yes, if you're trying to duke it out with a rival, get on ad quick, get a billboard. It's underrated to take, you know, debates from the timeline to the 101. Just, you know, air it all, air it all out. But yeah, so Sam, you know, we had lesson on the show, I think last Friday, broadly, you know, talking about opportunities and AI and the whole kind of full spectrum. Maybe, yeah, I mean, I don't even know necessarily where to start. You guys were the ones that it were. Well, okay.

Here's a little. I'll go, Seth and I have been debating this for years. Let me try to tee it up, which is I for several years, so I try to be self-consistent, have been. very pro that AI is going to make the big, big, big platforms a shit ton of money. And it's going to be really good for small businesses. But it is a terrible place to hunt for startups, right? It's a great way to lose a lot of money on startups. Now, my refinement of that, which I will give as a refinement from my, like,

I do really believe in what I'll call AI cherry on top businesses, which is businesses that are good that there's a sweetener because of the efficiency of AI. But broadly speaking, when people come in and pitch AI, my answer is, pass, please go call Seth. Seth's answer, I think, is, please call me. Okay, Seth, what you got to say? So I think that teased it up well. So I'll give you two examples of where I think massive new businesses can be built that are, let's say, AI native. I think one is like networks and marketplaces based on new democratization of being able to create new types of content. So like the analogy on the phone is you now have a camera in everyone's pocket. The first wave of apps was like camera filter apps and then Instagram fart apps.

Fart apps and like drinking a beer app. A beer drinking. Fair. But like the first camera apps were like, you know, just like little fun. tools you could do with the camera, but then the real mobile first business were things like Instagram and Snap, right, which basically created networks around democratization of creation of new content. And I think if you think about AI, like what new types of content can now be created by

everyone. There's a few examples. One are games. Like what's the next Roblox? Two is music. You know, is Suno going to have like a consumption experience? So they're going to be a new type of network there. Three is software, right?

just generally. I don't know if there's enough out there to build like a, you know, web app store around productivity or vertical SaaS or whatever. But there's basically democratization of new content type. And I think you create a marketplace around that. I think you could build a big business. So I mean, I guess, go ahead. I guess to like maybe push you a bit further there like specifically around Suno. And I don't have no insight into what they're actually doing. But if I create a great song on Suno, don't I want to share that with like the most amount of people. So I would just like take that to YouTube or X. And wouldn't that be an argument that, you know, like the value just kind of continues to just like anchor around the sort

of distribution platform? Yeah. I think that would be, you know, a base case or kind of like smaller outcome for Suno. If it just kind of gets relegated into the creative tool. But I think if like the number and quality of things that are actually created all, you know, on the Suno platform starts to exceed or at least like take a meaningful but separate piece of the market, then they could just create a more closed ecosystem where the only way to get that content is on Suno. I see that's extremely unlikely. I mean, the thing that I think is like that I would say I buy is I'd say that in general,

the medium is the message, right? And so you have in a lot of places. And so when you have a new tech. By the way, Sam, Sam made me read that book as onboarding for Facebook. I did. I used to control, I used to have the distinction of controlling the reading list, which I invented for all onboarded PMs. And I hired Seth and then made him read, what was it? It was, it was.

Snow Crash. Snow Crash. Snow Crash. Okay. Snow Crash was well before Oculus on the required reading list. Fantastic. But look, I mean, I think here's what I was going to say is, I do, if you think about like a long, of what the internet is people like to think about it as a technology right or a lot of that's what

it really is is like an information economy or a content economy and like i think if you start thinking about things on economic terms of like producers consumers like what's the what's the holistic picture of that you do get some really interesting frameworks for talking about AI so i'll give an example what is facebook or what it's social media it really is a content pump right there are rules does an economy established with it, that economy then produces a certain type of content pumping out of humans that otherwise wouldn't have been pumped out and then recirculates in the share and creates an economy on it. If you said, hey, AI creates some new affordances that makes it cheaper to pump information. Like all of a sudden we can frack humans, right, in a new way. And by fracking them,

there is some sort of like new content type that comes out that is super compelling and super different. Sure, like maybe that there's something there. But I think the, the most likely outcome by a mile when you think about products is it just turns out that like most products and the platforms already exist it's all about getting later getting paid these AI is one of the greatest extensions of existing platforms you can imagine it just makes everything better and just like fracking you kind of get new content or cheaper content from people because AI makes it easier but it all flows to the same fucking pipelines right and the money is not in the fracking because the fracking itself is commodity yeah i definitely

that the fracking is commodity meaning the creation the question is can you frack something new that then creates a new network right and i just think it's extremely unlikely because the pipelines exist right like there's no like what is the new like you don't it's just oil yeah but does that make it a good VC bet if even if it's even if there's like a you know five percent chance but the new network is you know i mean that's what happened ticot right like it was first just those lip-sinking app and you would repost that content elsewhere and then they bootstrapped a network on top of it and became a very good outcome for, I guess, the CCP, but, you know, in, you know, you could imagine an American. But that was a new content type. That was a new content. Like, snap. Doesn't Harry Potter,

Balenciaga videos? Couldn't that be the, the, the, the, the, the, the, the, the, the lip-sinking video of this era? I feel like I'm a Democrat with CNN on my side here. I got the hosts on my side. But, no, I don't know. I don't know. We're just, we're just guiding the conversation. Yeah, yeah, yeah. I think you're both, uh, I think you're both wrong. No, I'm the problem, the problem with AI, in general, and I think the entire AI discussion, is, I always like the point is that, it's like, the average of infinity and zero is infinity, right? And so VCs aren't very good at math, but they can do that one. And so the problem is you say, okay, this is so disruptive that even though

the likely outcome is zero, because there's like no math you can do on this and mark it big, then you're like, well, I'll pay anything because maybe it's a thing, right? And like, I think that's actually what's going on in the industry a lot. I think it's quite bad because it leads to this complete lack of like thoughtfulness and discipline. It's just like the most rudimentary math on what happens. I look a lot. There are actually projects. I'll give you an example of something I actually believe is like new content that can exist because of AI that not only I've invested in I helped start, right? Which is we work on this thing called Merit First with Joe Lonsdale and his team. We have some good announcements that'll have a lot soon. I like this, Sam.

Here's the thing about it. Here's the basic setup for it. And it is an interesting AI-oriented business because you say, look, the way you hired people to date in most world is credential-based. You're like, ah, you went to Harvard, you studied this thing,

you got this checkbox, now you're in my pipeline. Hell, I hired Seth because we used to go to New York and say, we want to talk to the smartest people from Bain, McKinsey, Goldman, B-CG, and Morgan. That was it. That was like the entire thing.

We don't know how to look at everyone. we're just going to like go call those people and we'll like pick some of them, right? That was how we did hiring, at least in the alternative PM hiring we were doing. What is way better is to do it based on what you can actually do, based on tests, based on, you know, forget credentials. I don't care how you got good at something. Like, show me what you can do. Here's the problem is if you go to a most hiring manner to say, hey, hire based on tests,

you have three problems. One is they're like, well, I don't know how to design a good test, right? Like what is a good test for this role? It's actually pretty hard to figure that out and make it mean meaningful. Two, how do I know you're not cheating? And three, the biggest most non-obvious, once you have like 10,000 applications for something, you're screwed because you can't possibly actually grade all those tests, right? Unless it's like a multiple choice, which is like not sophisticated.

So does AI have leverage on that? Absolutely. Does that mean that there's like a new way to think about a human interaction, like how do you hire people because AI exists? Absolutely. Like that is the type of thing, but it's not, you're not investing in the AI. You're investing in like a new way or a new approach to hiring, which happens to leverage AI, right? And I think there is an important distinction there.

Well, yeah, I'm glad I already got hired so so I don't have to compete. Yeah, you don't have to do it. Yeah, I don't have to compete with 20,000 other people. But the, that's actually kind of the second big bucket, Sam, of AI opportunities that to me are very obvious, which is just AI opening up new markets that were historically owned by labor, right? And right now you're talking about recruiting, mass of industry. It's mostly human-led. There's a long list of others, right, where technology is now taking labor spend,

whether it's legal, whether it's accounting, compliance. We have a company in our portfolio called Greenlight that's growing super fast, and it's just, you know, these large banks and fintechs have like thousands of compliance analysts that just go through checkboxes and write reports. And so you're competing with BPO's in these cases. Well, kind of. But I think this is something if you're really careful about. Because this goes back to the whole, like, what are you actually investing in?

And is this an AI company? Like, one of the big memes right now in venture capital is, oh, we should like buy accounting firms and make them robots. Yeah. And by the way, I'm not doing it. I'm not doing the roll-up. And it's like, I mean, we've actually done a bunch of roll-ups that we think do make sense.

But like, this is one in particular, I think, is really stupid. Because people don't understand. the point of accountants, right? The point of an accountant is not, like, you could have a robot, you could have some fancy AI that has a 1% error rate or even a 0.1% error rate on your taxes. Your accountant might be running a 3% error rate. Who do you hire?

You hire the human. You know why? Because you know you're really hiring with an accountant? You're hiring someone so when the IRS is like, you fucked up your taxes. You're like, I don't know, talk to Steve, right? But you could still do that. You can still sell software to a big account.

Like, talk to the robots. million accountants right now. Send them the chat gbt.com link. So the basic point is like there's a lot of jobs that people want to like, ooh, machine can automate and you're like you don't understand like this is a liability shifting thing like most a lot of human jobs are not actually about doing the thing. They're about shifting liability and responsibility. Right. That's yeah, I agree that the job will change to its essence, which is like trust and sales. Right. But that just means that that individual guy, Steve, who everyone trusts to put a rubber

stamp can do 10 times the amount of business with, you know, a type of the staff. But the problem is the AI itself is commodity and everyone will have it. And like, that's not where the leverage is. So you're not really investing in the AI business, right? You're still investing in the accounting business, Steve's business, right? And everyone has the same level. It's a classic war of attrition where like you, you, and I just don't think this is a place where like, unlike a true, you're going to like make money on the arms dealing because the arm's dealing is all commodity. Well, the question is, does Steve, like, is the software that Steve's using to leverage himself? Is that OpenAI and ChatGPT?

It doesn't, is that Tomlin Reuters? It just doesn't matter. It's all commodity. Okay. How do you map this to the mobile wave? Because we were just talking to Logan Bartlett about this. It's kind of the classic innovator's dilemma, sustaining innovation versus disruptive innovation. And with mobile, it was, it did feel like a sustaining innovation in that the mobile

Salesforce was just Salesforce. And yet, a lot of VC's made a lot of money betting on mobile companies if they got into WhatsApp. You don't think so? They didn't make that much money on it. I mean, I think Silicon Valley has a story that venture capitalists like tell LPs, which is every X years, the whole thing gets reshuffled and there's all this money to be made. It's bullshit, right? Like, going from shrink rack software to internet, that was a big deal, right? That was a paradigm shifting, broke the machine thing. You know, I would actually argue that the shift to mobile was not, disruptive at all right like you have all the same winners they're just bigger right um i would argue that the shift to cloud was barely disruptive right um and it just turns out that like there's

there's a very big difference between things things that are so important in paradigm shifting they break the incumbents and there's huge opportunities for win like that's why crypto is really interesting think what you will of it it's extro crypto is extremely hostile to incumbents right as like a concept we can talk about how it's being now co-opted by incumbents but like in general like it's fundamentally is, whereas I could not think of a more classically extending innovation than AI, right? It just makes the rich richer. When's the Sam lesson MAG 7 ETF coming then? If you're so bullish on the... No, you've got to buy jelly jelly. Well, first of all, I'd say the mag 7, like I would actually argue, I was, because I like to look the cookie on these things. Yeah. Is like I was like, I think,

you know, if you go back two years, like pitching the like these are the five companies that are going to win in AI and it's all the same ones that already exist. I mean, it was, you know, so I'm into the mag seven thing I also would say like when people ask me like my AI investing strategy I'm saying like thank God I held on to some Facebook stock right like that's the answer it's like about the idea that yeah what about the idea that like Apple's slipping or Google's not shipping fast enough like this does create opportunities for entrepreneurs at least to build a company that gets acquired or something like they're not going to get acquired they're just going to

get copied here's what I'd say like I don't think the AI I think here's maybe some common ground with Sam and I like I don't think AI is going to kill incumbents in favor of startups but I do think it it opens up new markets. And yes, they're outliers, but that's kind of what we're in the business of doing and funding. And like for mobile, yes, like it didn't kill Facebook. It didn't kill Airbnb, but it created Uber. It created DoorDash. It created Instacart. It created TikTok, right? It created Snap. It created Instagram. Created WhatsApp. And so these are tens of billions, hundreds of billions of value that were kind of mobile first. And it's a similar thing, which is like, what are the new

GPS, camera, video. Can you create, can you use that as a hook to then create a sustainable business, whether it's a network? You know, I agree with you, Sam, that like AI by like doing an API called OpenAI is obviously not defensible, but can you use it as a hook to then build a real business? And I just think the answer is in almost all places, no, right? Like I think it's a thing. It's just like, oh, everyone uses it.

Everything gets leveled up. You know, like your thing about incumbents and Apple, look, Apple, Apple is comic. We talked about this last week. Like the Apple stuff is like pretty funny, right? Because it's so bad, right? But it's not going to make me buy an Android phone, right? And so you're like, so they have a hell of a lot of time to figure out something.

Like it's, we are a long way away from that being a real issue for them, even if it's pretty funny. What about the more sclerotic industries? I mean, you're thinking about, you know, like management consultants seem to be printing money on AI, just strapping on AI pitches onto legacy businesses. As I see like, oh, I go to IBM or something with, oh, I want to re-platform my app and I just need a bunch of programmers to do that. It feels like an AI native company there could potentially scale up and get really big. I don't know. I mean, look, Accenture is going to make a lot of money short term on the stuff, right? Short term. The problem is Accenture is mostly in the business of BPO outsourcing.

And they're going to kind of eat themselves in doing that, right? And so it's going to be a very different world for them in terms of how they navigate this. Good, good any, but like anyone who sells business consulting is going to do pretty well in a period where like to you transformation for a little bit. It's just like these are not VC backed businesses. Like these are consulting firms that will make money for a little bit, right? I mean, it seems like you're just super bearish on VC as an asset class. Like should founders just go and build, uh, just just go and build a, you know, lifestyle business

or something or pick some different capital structure? So go for it, Seth. Yeah, no, I mean, AI is also great. I think AI is just an accelerant for everything. It makes large companies more profitable. It opens up new markets for startups, whether it's services, businesses, or new networks. And it's also great for lifestyle businesses. You can, there's a long tail of random problems that you can now solve really specifically

with a very small team. So the way I would phrase it is related, but a little differently, which is in life, the mineral usually drops out. Right. And I think AI is a great example of dropping out the middle. Like no one being a, there's no such thing as being a $10 billion public company anymore. It's just like a dumb place to be. No one cares, right?

You either want to be a hyper scaler, right? Which is a great, I mean, it's a great place. Like most of the market says, AI, interesting. Where put money for AI, right? And like that's like the Sikh. And that's why you've seen like the Mag 7 in particular things like Facebook just crushing it. because you're like, no liability, tons of upside, like, easy bet. Like, why is everyone buy Nvidia?

They're like, we don't know how to invest in this. Invidia seems fine. Or like, we don't know how to invest in this. Let's just buy power, right? Like, because we're not sure how this plays out. So, like, the big will keep getting bigger and there'll be like a massive thing. And then on the very small interior like, you know, lifestyle. Look, I, the reason we have a creator fund, right?

The reason that we do a bunch of stuff at the low end is I totally buy the thesis that you're going to see individuals that have a lot of trust and brand. and community and deeply understand a niche, do things you haven't seen before. Like, I buy the one person billion dollar company thing. Like, I think that's real with like what the leverage you have. I think the key is you just have to have the right capital for the mission you're on. And having the wrong capital is a really bad place. And by the way, the worst capital you can have, I personally think, is being a subscale company

competing with hyperscalers using venture capital. right that's like a recipe for total disaster because the hyperscale has have orders of magnitude more money in time right and you're just like you're kind of truly bringing a knife to a gunfight isn't it possible that we wind up looking back on this in a few years and think like oh we just hadn't thought of what the uber for AI is how do you think about the Uber story with mobile to you know today like Uber was hard to predict when the iPhone dropped I mean we were already seen the Uber for AI they're like what's the Uber A. Cursor? Like the next Roblox? No. Those like they're fine.

They're fine. I think like it's interesting. Why do you think cursor is interesting? Like it's curses I like it. I use it as a product. I don't see it as a good business. I just think like it's the classic like startups need to get distribution before incumbents innovate. And now because these tools are so powerful, you're actually able to get distribution as a new company very quickly.

So if you're first to market with the best product, then you can start leaning into all the other things that kind of give you defensibility. I don't know. That's true. The thing is, people are applying network thinking to what's fundamentally just a technology, right? It's not a network.

There's no network. First is not a network. But there's a lot of soft products that become very sticky because they become the default. I don't think so. I think the whole point of AI is the switching costs for almost all this stuff goes to zero, right? And because switching costs is zero,

there's just no value. I mean, like, I have, I use, Chorus. Have you guys played with chorus? No. It's awesome. I haven't used it. It's great. It's basically just like a desktop app and you plug all the LLMs into it, right? Like you have keys for all of them and like I don't care like use the best one marginally when a new one comes out. You know the only defensible thing it is is there's so many fucking LLM models at this point. I'm happy to give someone the job of actually researching them all and deciding which one to send a specific query to like there's some sort of aggregation value there for a little bit for now. But. I don't know, man. One fun thought exercise on the social side is that, you know, we went through this generation, you know, social media was great initially because people were like, oh, it's actually more interesting to see what my friends are kind of talking about and doing versus just like traditional media, which is like random people. And then it was like the Kim Kardashian era of, you know, it's more interesting to like follow a famous person's life. And it's possible to imagine a world where just being in a version of Instagram. where everyone's a bot and they all like, you know, are either polarizing or exactly aligned with

your views and there's just like this kind of constant stream and you get, everybody gets a thousand likes on their posts and they post. This is like my line on this has been that the for 20 years, the way you start a social network, as you say, who do you want to follow? And the way to start a social network today is say, who do you want to follow you? Right. Is like the inversion that you could see. Like I'd actually argue Twitter is already doing this.

Like Twitter, I think is intention, my, I'm not, I have no inside information. My sense is it is intentionally full of bots, right? Because people are lonely. People want responses. It's clearly full of bots. Yeah. We talked about this, Sam, as like a new social network. Yeah, so you're like, look, it doesn't, you clearly, there just aren't mathematically enough humans to fulfill people's need for like validation.

So like, sure, throw a bunch of machines in the mix so that people have more validation floating. This is why I debate, Sam. I just want more billboards. Yeah. I think, I think one. one example that is way too easy to like or way too early to make a call is you have um so set you guys are in a toome which started out as like the ability to like generate uh slides which like people spend a ton of time all day long making slide decks like there's probably billions of dollars

spent just producing slide decks in the u.s for various use cases uh they recently sort of pivoted into a space around um you know automating sales research and outbound. You can imagine like, you know, like a real test will be can Tomp compete with Salesforce when Salesforce has this sort of just, you know, army of people like jamming, comparable products, you know, and actually for, you know, there were some news and the information, I think yesterday that Salesforce is basically saying if you don't pay for agent force, we're like raising your, your regular, you know, rates on the CRM side, like three X. I can already cue the S&S.

Let's say a fan show because of his company, but I love Keith. I really respect him. He's a great guy. He used to work with me too, same team. Is no way he can tell him compete on this, but I'll go even a step further, which is this entire industry of outbound goes away. This is where we're talking about the real displacement of what's going on. So first, I mean, I have several portfolio companies that are calling us saying, you know,

we have this thing. We tried this thing in AI, but now all the platforms are just bundling it and giving it away and we can't compete because even if we're better. So that's happening all the places and you're like, duh, of course that's going to happen. This is an easy tack on. But then the step two, which is where the really interesting socialist placement comes to this, everyone's excited about, oh, I can use AI to like customize outbound sales or something. You're like, your inbox is now worthless because once all the sales are customized,

you can't tell what's real and what's fake. That entire economy collapses, right? So I'd actually go, the more likely outcome is a, no, Tom can't beat Salesforce. but too, even if they could, that entire emotion goes away because of AI. Yeah, look, I don't think you need to beat Salesforce to be very successful and to find a segment of the market that wants a more modern product that, you know, understands your business, has everything in one place, and can actually make your sales team a lot more effective with a more modern architecture.

So I think Tom is going to be successful because, again, you can think about this hypothetically or you can talk to customers, especially in different segments. just see where the pain is. But one thing I'll agree with Sam on is I think we're in an outlier business. You have to be very selective. I think people who are overpaying for things that are not durable at like crazy prices. That's not a game that we're playing and not a game that I believe in either. I think, you know, backing like amazing product builders and technologists going after

either existing markets that need to be totally re-architected using AI. or totally new markets that open up, whether it's like a gaming network or replacing services in a very long tail of really large markets. I still think there's like a massive amount of value to be made. I just think that it's such a different way. I'll give an example.

I think it's, you don't want to back generic Facebook PMs anymore who know AI and product, right? Because they don't know anything, right? And like it's just commodity, if anything, the irony is it's all getting, all those things are getting hyper commoditized in terms of an AI only commoditizes it faster. How do you build and what is a product?

It stuff doesn't, like if you told me, and we look at some of this too, you have a truly unique market insight. You understand a market that no one else gets because you've been a specialist for 20 years in it or whatever. By the way, the tools of building and the paradigms have changed so quickly, there's an opportunity to build something new. Yeah, there's interesting stuff there. We do businesses that are AI, quote unquote, enabled all the time that fit that pattern. But those people are generally not building quote unquote AI tools.

They're just like, it's kind of like saying, like, they're not building cloud companies or internet companies. They're just building great companies that happen to leverage technology. Okay, I agree. Like, there was like an AI conference last week. I'm like, this concept of an AI conference is going to last like six months because eventually, you know, it's just. It's like building internet business. Everything is a computer. Everything's computer.

Everything's computer. Everything's computer. We're at 30 minutes. We got to ring the gong. We got to wrap it up. So who won the debate, guys? Closing arguments. We'll let the fans decide.

Damn. Let the market decide. We'll let the bots decide. It's an economic battle. It's a capital war, capital fight. Whoever deploys more bots to vote wins. No, no. Here's the real way we're going to do it.

I will put a calendar invite for like five years from now. Okay. I love that. And we'll just come back. We'll watch the debate and we'll just pause and people can take little victory laps. They can talk about companies that. I love that. I love that. Five years from today, mark your calendars.

I look forward to it. Thank you guys for jumping on. Have fun on the 101. Enjoy it. Have a great week, guys. Talk to you soon. We should host the follow-up to that debate at a Wander. Go to Wander.com, book a Wander today.

They're also doing a giveaway, sign up, and... Wander.com slash TBPN. You can also use TBPN to get $300 off your first day. One thing about Wonders, the properties are so amazing. They do get booked out pretty far in advance at times. But not five years in advance. Not five years. So we can definitely get something.

We can get something in the books. Home sweet castle. That's what I'm looking for. Inspiring views, hotel great amenities, dreamy beds, top tier cleaning and 24-7 concierge service. It's a vacation home, but better folks. Check it out. Let's go back to the timeline. Wrap up.

Let's do it. And that was, and just to summarize, that was fun. Who do you think one? I mean, I do tend to side with Sam. I think Seth has good points. I think Seth's an optimist. He's in the outlier business. You know, the entire model of running a fund like Greylock is if we can back, you know, one or two, you know, really impactful companies per fund.

They have more AUM. They can, you know, make bigger investments. And I think they're in the sort of optimism business. Sam is much more of a pessimist. Sure. But he has some real points, right? You know, that Tome company specifically, I brought it up, they started. They were very hyped sort of AI slides company, didn't find a market for what they were doing. Now they are competing with Salesforce. And I can imagine, I mean, anybody in sales is competing with Salesforce. They're an AI assistant for sales. Sure. Yeah. And it's, I mean, it is good to kind of like break down like what it means to be bullish on AI generally because you could just say, yeah, the AI thing is real.

And the way I'm expressing that is in a mag seven ETF and going along hyper-scalers. Or it could be I'm building a lifestyle business as a solo developer vibe coding, pumping it out on X with videos and making money that way. And so there's always a bull market somewhere. but I think Sam is narrowing it down to, hey, maybe $20 million series A's are particularly fraught right now. Yeah. And I don't know. It's possible.

It just depends on if you get into the right business. I still think it's early enough that we could get our WhatsApp. We could get our Uber and you might see some funds dump $20 million at $200 million post and still get 100 X return. The big thing is, it seems like what we now define as AGI is an extending innovation, but it's the sort of looming ASI. Sustaining. Oh, that's the disruptive.

The real disruptor is ASI, not AGI. Exactly. As we're sort of currently defining that. My joke with that is that eventually when ASI comes, you say, set up a website or buy me something and it rebuilds stripe from first person, like all the way. It writes all the code that's ever existed on the internet in five seconds and builds you everything.

And that would be very disruptive. But I think we're a long way from there, especially on how much it costs. to inference these models and how rough the vibe coding thing has been amazing. But then we've heard a lot of accounts of people saying, yeah, it'll get you 80% of the way there, 90% of the way there, but there's still a lot of humans in the loop. And maybe we are seeing not acceleration, but deceleration in the efficacy of these models. But they're still really fun. They're cool.

And I want to check out some of those ones that he recommended. I actually did play with Suno last night for the first time. Bedtime song? No. I was trying to make a theme song for TBPN. I was thinking we need our own, you know, NFL. Do do do do do do do do do do do. No, so what we should do is get a symphony.

Yes. And we stand in the symphony. I think we need. And they play it. And we just, you know. My takeaway was that, yeah, I would love to get a human to do this because the first version that came back, I was like, you know, ESPN style football song, intro. And I didn't have lyrics turned off.

And so it generated all these funny lyrics like football games starting now and like all these really ridiculous things. But lots of promise there. And I mean, just the mid-jurney of music seems fun. I don't know if it'll replace everything, but certainly like a tool in the tool chest for the artist. Overall, I think having a debate letting people share their opinion and then circling back to it. Yep. I like that. I like that.

Because you can't win a debate like that in the moment. It's just vibes right now. Yes, definitely. And I think keeping it tight and short is key. Yeah. Anyway, let's move on to the opposite of tight and short. Larry Ellison's longevity, which is unreal. He's been in the game for decades.

Putting up these numbers. Look at this chart. Oracle Corporation is up 210,000% all time, dating back to the 80s, putting up these numbers for the lifetime of modern tech industry while also being the true Brian Johnson, if you are not familiar with how young Larry Ellison looks, he's looking fantastic. When he was born for context, we were still in World War II. Wow.

Fantastic. Insane. Yeah, Oracle, not mentioned as much as the other magnificent seven companies, the hyperscalers, but clearly doing something right, the stock is up and to the right. Yes. And so we love Oracle here on the show. big news this really shook the tech industry to the core Juan over at Ramp got a race

There we go He said turns out hit the size gong for Juan Congratulations Day one of asking Ramp for a raise That happened November 13th of last year Now it's March 13th and he got it done Based on your accomplishments and results in 2024 We're pleased to provide you with an update to your compensation package

Congrats to Joanne Let's move on to it. I mean, nobody, everybody said, oh, this is never going to work. It's impossible. But he did it. He was consistent. He, you know, survived and thrived for controversy and he got the raise. This would have been a great debate to have on.

We could have had Eric and Kareem come on, debate it. With you on. He's got to make a presentation. Yes, yes. It's live on the show. This is how raises will be done at ramp in a few years. Anyway, let's move on to Luke Metro. He's quote tweeting Michael Dempsey.

YC used to feel like a window into understanding the areas progressing from what the smartest people know, what the smartest people are doing on weekends to VC-backed startups. Today it feels like the best window into the current consensus thing. And Luke Metro says, lots of tech feels like this now. Here's my theory. Pre-2020, there were still novel insights in lots of small offline subgroups. VC Scout programs existed to capitalize on this. But post-COVID Silicon Valley moved entirely online.

Now the time from outgroup to consensus is minuscule. What's your take? I think this is totally right. It feels like YC now is a reflection of what the internet is interested in. Yeah. Right? What the sort of community is interested in. And I think that that's fine.

It's, if ideas are important, we should have a bunch of people attacking them. That's the beauty of the free market. Yep. But I think this is totally on point. The other thing is that you, the company, that are truly not like that don't feel relevant at YC or that feel weird are the ones that don't get the hype because they're just tinkering on some weird thing and then six you flock safety is a good example right I'm sure the flocks safety batch was just a bunch of sass so um and luke also

had another good post from today uh we did that that i just got pulled up here he says the real project europe is vc spending three months in the south of france this summer so we were you're going to say that You have the same idea. We had a similar idea. That's genius. We love it. I love it.

Well, yeah, go enjoy Europe. Book now, book on Wander. Book your trip to Europe. Get out there and spend some time recuperating. Well, you can feel the AGI. You can feel the AGI. Let the innovation, the acceleration wash over you under the Tuscan sun. Yep.

Albedo has some news. They are launching. I was texting with the founder. We're hopefully going to have it on early next week. Clarity One will launch as the first. commercial satellite to operate in very low Earth orbit, beginning with 10 centimeter resolution imagery, previously only possible with aircraft or billion-dollar government satellites. Albedo is redefining what's possible from space.

And so we'll have to have them on. I saw a picture of the fuselage of the Falcon 9 that they're riding on. Nice. And good luck to them. There's been a few delays, as there always are with these launches. But it's looking good. And so you can tune into that launch tonight. SpaceX is going back to Leo.

What time is it? I think he said like midnight Pacific time or something. He was also like, you guys are live, right? Saturday at midnight? Yeah. I was like, not yet, but stay tuned. We're getting there. We're working on it.

Let's move on. Types Fast. Ryan Peterson, founder of Flexport, friend of the show, been on. He is quoting Leonard Bernstein, who says, two things are needed to achieve great things, a plan and not quite enough time. Civilization 5 when building the Big Ben Wonder. He's been pulling quotes out of Civilization 5. I love it.

It's awesome. A bunch of bangers in there. We had Captain Price last week. I've never actually gotten into SIV. I've wanted to, but it's a big investment because I think the time to actually play a full game is more than like a few hours. And so I haven't been able to find the time. But he's spent a lot of time on planes.

He's got Starlink locked in. Actually, I think you can play SIV offline. It's not even a multiplayer game necessarily. So good way to spend a few hours in the belly of a 747 ferrying packages around the globe for Flexport. Anyway, to we move on to Augustus, Dyrica. Augustus himself, he says, every 20 to 30-year-old man I know who is great where that's aspiring for greatness seems to get mentally

and spiritually obliterated daily. They're not without joy, wisdom. or purpose, but constantly raw. And Sernovich says, adult men are not supposed to feel happy. It's abnormal. You should question what you're doing. You should feel the tinge of fear. It means you're pushing yourself.

The alternative is sitting around waiting to die like some Muppet. And, yeah, I think I put this in the stack just because I think it's important to realize that, you know, optimizing for feeling good all the time. will be your downfall. And part of, you know, having a great life is not just not optimized, you know. It's not optimizing for happiness specifically. We talked about this with the Lone Ranger. The goal of a startup is not to be a happy startup. It's to be a successful startup.

The goal of a marriage is not to be a happy marriage necessarily. It's to be a successful marriage. And that's a different vector. And happiness is derived from that and adjacent to that, but not the end-all-be-all goal. Because as soon as you start optimizing purely for happy, You put a lot of the grind to the side and rest on your laurels. Should we go to Nikita?

He was talking about vibe coding and where some of these apps are going. If you've tried following vibe coding games over the last month and have tried making one yourself, it should be abundantly obvious that we are very close to someone building a creation ecosystem or app store where anyone can be a game developer. And success of the creators within this future ecosystem will be determined by pure merit of their concepts, not technical execution. The only gap that needs to be closed for this ecosystem to exist is abstracting away the remaining pieces that are too complicated for the layman, authentication, server networking, and deployment. Once that's achieved, the only thing left for

a creator to do is to dream up their concept and click publish. And suddenly, we will have millions of people making 3D online games with graphics comparable to N64. I love that. We talked to a YC founder who's basically working on this exact problem. One of my friends, Kyle Russell built something like this. I want to say like five years ago, he was working on it right in 2020. I met him through Andrews and Horwitz. He was like the associate on the deal. And a great guy. He built this company called Playbite and it would let you, it gave you a bunch of primitives and on your phone in a browser you could build like a top down 2D game. And he was just like maybe a little bit too early with that concept to really get a skate velocity because it was it was

easier than roblox but didn't really have the same like viral breakout moment but you can certainly imagine like what the vision of what he was laying down makes a lot of sense in terms of app store of course niquita got a lot of pushback here everyone said he said stop saying roblox i'm talking about something much more customizable the thing is that i've seen some roblox games that are incredibly customizable i've seen people say like we rebuilt call of duty in roblox and it looks like like Call of Duty almost. I don't know if it's fake, but we'll be interesting. Somebody rebuild the TBPN set in Roblox.

Oh, they'll record a... No. Oh, they should. We'll record a show there. Yeah, that'd be great. In the Metaverse. Should we go to Bo Nickel? We got some breaking news.

We got some breaking news from Bo. Break it down for us. It has a new fight. It's going to be on May 3rd. I'm going to pull up a supporting article here. It's a middleweight bout. Yeah, so Bo is a middleweight. He has been...

Assume that has something to do with like the size of the guys. Is that how it looks? Yeah, yeah, this is the joke. John is obsessed with professional bodybuilding. I follow UFC closely. Yeah. But anyways, so Bo, a friend of the show and listener, he's also an entrepreneur, has his own business. You can check out.

He started in Dana White's Contender Series. So we got a couple wins in there and then has gone on a tear. He's 7-0. he's 29 for those that don't know which is like kind of the prime years right he's got a bunch of wins under his belt and now it's time to make a run at the title and they're allowed to punch and kick is that how it works

the last time we covered bow on the show uh beau texted me and he was like I'm always amazed with how little John knows so his John's knowledge is actually even like going backwards the ring isn't square right yeah it's almost like it's like it has more side it's it has eight sides It's an eight-sided. Okay, I know that, yeah.

Good, learning this stuff. And so anyways, Bo is one of the top prospects in MMA right now, and his next fight is against this guy, De Ritter, who was at one championship. He's been a two-weight class champion over there. So this will be a huge test for Bo, but we are very excited for it. He's been training hard. and good luck to him. We'll be watching, hopefully, live.

Yeah. But we'll see. Good luck to him. I hope he can go all 25 rounds. Is that how many rounds there are? I hope he makes it. Honestly, I hope he gets a gold medal, honestly. I really hope he gets a gold medal.

I'm, I think he's going to make short work to Ritter. Yeah. Good luck to ridder, but. Let's go to another friend of the show, David Senra. he shares some sage advice from Peter Thiel. Superior sales and distribution by itself can create a monopoly, even with no product differentiation. The converse is not true.

I love that. And it's funny because it's like MBA advice almost, but it's contrarian in the VC context, because for so long there were these naturally growing, like, Facebook. They didn't need to run billboard ads for Facebook because it was the social network and it just grew. But they really did have better distribution. because of the network effect and the model. And so an example of this, right?

So we were just talking about Salesforce versus some of these upstart sales assistant companies. Yep. Part of Salesforce's monopoly is they have thousands of people that sell Salesforce. And they're going to customers current and new and saying, if you don't buy our AI assistant for sales, we're going to increase the price of the product that you actually want. And for many companies, like, it's just the default CRM. And so that by itself is like they have the distribution.

They have, you know, the labor force. And, yeah, it's going to be very tough for a lot of those players to get anywhere close to threatening sales forces market cap. Should we close out with a fantastic private equity story? Boiler Room is apparently private equity back now. Levels I.O. shares the financial story of boiler room is interesting. Boilerm started in 2010 by Blaise Belleville with weekly live broadcasts on YouTube, if you're not familiar, their DJ sets, essentially. Over the years, he raised $12.6 million in VC funding in total. Then in 2021, while Boilerm was heavily struggling financially, he sold it to Dice FM, an event ticketing startup.

Dice had raised more than 200 million in VC funding. Then Dice sold Boilerm a few months to superstruct a festival organizer that owns festivals like mystery land, Defcons, a bunch of others. then last year providence equity a $35 billion private equity fund sold super struck to KKR which is a $100 billion private equity fund so a $100 billion private equity fund now owns Boil Room. Many articles state boiler rooms founder Blaise Belleville exited around 2021 but he's still involved in the company so more likely he received more stock while working at it. I mean this is just a beautiful story. Yes. And you know a celebration of I mean I hope that they do private equity night. at the poiler room. We don't go to events like this. We're just not big into that world.

But boiler room celebrate the shareholders. You know, do a big party for KKR. You know, I want to see the champagne bottles popping and the big KKR sign walking out. Exactly. Like when you spend $10,000 on this bottle of cheap champagne, just know that you're just sort of like supporting big private equity. You're driving EBIT down multiples. There's other, you know, we've said on the show before, there's other, and there's other

fantastic companies owned by private equity, TechCrunch. Vail. Vail. This could be the next veil. You never know. Yeah, I mean, we made the argument earlier this week that TechCrunch should merge with Vail

and just become a ski lifestyle magazine. Ski Lifestyle magazine. That's the real way. Anyways, it's been a fantastic show. Thanks for tuning in. Go leave us a five-star review, put an ad in it. It helps with Discovery. And we hope you have a good weekend.

if you if you're working over the weekend and you're missing tbpn you can go back we have some the back catalogs full folks we've got many many many many episodes of this show and if any of you have listened to every single hour i would be very impressed but there's probably an hour in there somewhere that you haven't listened to so it's okay um and uh anyways we will see you on Monday see you on Monday cheers bye