TBPN - Masa's Epic Rise, New AI Paradigm, The Drone Race, $MSFT Earnings, Evolution of the Tech Bro

Episode Date: January 31, 2025

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Welcome to Technology Brothers, the most profitable podcast in the world. Let's kick it off with a quote from David Senra. He is quoting sage advice from Lee Liu, Charlie Munger's favorite investor. And he says, you can compound knowledge faster than money. If you truly love this game, I would suggest that you don't take shortcuts. It might take longer, but it's more rewarding. That's what we're trying to do today. Compounding knowledge.

Let's go. More importantly than Lee Liu, David Sener is not feeling super well right now. he's got a little bit of a cold. Send him a nice comment. Send him a DM or a comment and say, heard the technology brothers told me you were sick. I hope you feel better. Hope you feel better.

And let's get him back in action. The RSS feed needs him at the top of his game. Desperately. Even though David on a sick day is better than your favorite, you know, your next favorite podcaster on their, you know, best day. Yep. We still need him back in business.

Speaking of next favorite podcasters, we got David Sachs here from the All In podcast. He still has the All In Back. He's monthly now, but he's still putting up huge numbers. He's got a great post here. He says, new report by leading semiconductor analyst Dylan Patel. You know we love Dylan Patel here on the show. Shows that Deep Seek spent over $1 billion on its compute cluster.

The widely reported $6 million number is highly misleading as it excludes CAPEX and R&D and at best describes. Hey, we're going to just ignore CAPX and R&D and every cost that you would normally. This is the most American thing you can do. We pioneered this. They even stole the idea of faking your financials from us. Sam Altman is actually pissed that they figured this out before him. This is just adjusted EBITDA.

It all comes back to Mesa. And Adam Newman. He pioneered the community adjusted EBITDA. DeepSeek puts up a fantastic community adjusted EBITDA, ripping out of CAPEX, ripping out of AAR&D. And just ripping the American markets. I mean, you know, you do take CAPEX and R&D out of... Psychological war. That's a point, right? Yeah. And at best describes the cost of the final training run only. And so today we have the semi-analysis post here. Deep-seek debates, Chinese leadership on cost, true training costs, close model margins, impacts, H-100 prices soaring, subsidized inference pricing, export controls MLA. And so if you're not already subscribed to semi-analysis, you got to do it, folks. You got to do it. It's one of the most embarrassing things that can happen to you in Silicon Valley.

Getting caught looking at a at a at a at a semi-analysis paywall. That's the way to get just kicked off a board Yeah. Yeah. Yeah. Yeah. It's disastrous. What were you saying? Yeah, if you see a VC out in public walk up to them say pull up semi-analysis right now and if they hit the paywall It's just very very negative signal. Oh, oh, so you're not raising the next one like you're you're retiring. Yeah, cool. Enjoy Aspen. Yeah, yeah. I hope you picked out some good stuff. So Dylan Patel writes the deep seek narrative takes the world by Storm for the last week DeepSeek has been the only topic that anyone in the world wants to talk about. Basically true. Deep Seek's daily traffic is now much higher than clawed perplexity and even Google's Gemini, which is crazy. But it makes sense. But is that the Chinese market? No, no, no, no. I think in America because the traffic stats are always aggregated by American like tracking pixels. Okay. But Gemini is super embarrassing because it's a Google product. They should be stuffing it everywhere, but it's so hard to get to. as we talked about before.

But close watchers of the space, this is not exactly new news. We have been talking about Deep Seek for months. The company is not new, but the obsessive hype is. Semi analysis has long maintained that Deep Seek is extremely talented and the broader public

in the United States has not cared. When the world finally paid attention, it did so in an obsessive hype cycle that doesn't reflect reality. Classic Americans. We get pumped. Love it. We go to the moon.

We get fired up. We crash. And sometimes... And we forget how to go to the moon for a few decades. Yeah, sometimes you're the world... Then we run it back. Yeah, we run it back.

Maza stuff. Yeah, sometimes you're the world versus man and then you lose 99% of your money. It happens. We'll get to that later. Very American. We want to highlight the narrative has flipped the last month when scaling laws were broken. We dispelled this myth. Now algorithmic improvement is too fast and this two is somehow bad for Nvidia and GPUs.

The narrative now is that deep seek is so efficient that we don't need more compute. Jevin's paradox is closer to reality. The models have already induced demand with tangible effects to H100 and H200 pricing. So you can just go look at the spot market for renting these GPUs, and you can see Jevin's Paradox in action today. And so it's a really strong market signal. Yeah, and ramps on us with their data, right, as a cost per token drop, the actual demand for them,

increased spending on them, increased substantially. Yep. And so High Flyer is the name to know. They're a Chinese hedge fund, and they started using AI in trading, and they invested in 10,000 A100 GPUs in 2021. This is before the chip ban. They didn't do anything. Everything was above board, but they got a big cluster.

I wonder how many trips to Singapore they've taken. Since then? Yeah. Well, that's the thing is that they might not have needed to because they just built up so, such a huge cluster. But it goes on to say they spent over half a billion dollars on GPUs with estimates pointing to 50,000 hopper GPUs across variation. So there's the H2, H20, the H-800, which is the nerfed one with that memory bandwidth,

which they got around, by the way. and then the H-100, which they can still get through the Singapore loophole and a bunch of other places. You can buy, I think, a thousand or two thousand at a time. And so there is an interesting angle here, which is that they truly do have goaded engineers on the team. Omega cracked, I think, was the term Dylan Patel used. They have a really crazy talent strategy. They aggressively recruit top Chinese university students offering salaries over $1.3 million. And I assume that's per year.

Oh, per month. I think it's per year. But in America, some people are making that per month. Yep. Got to get your money up. With flexible roles in unfettered GPU access, staff count is 150 and rapidly growing. And so they have, there's an interesting kind of like counter narrative to the whole like 996, grinded out, work really hard. They are much more like a research lab where it's just kind of people hanging out, trying stuff.

There's really like, you know, open-minded, try whatever you want. don't worry about cost, just run it. And it's produced remarkable results. It's more of an American style. And there had been some pushback because from folks on the DEI side just because there was no non-Chinese employees. They seem to have made that work.

Yeah, yeah. We'll see what happens. Maybe there'll be some pushback. I expect the New York Times to come after them pretty hard. Yeah, I would imagine Taylor Wrenz is writing something right now. Yeah. So in terms of server CAPX, It's estimated at 1.6 billion plus almost a billion in operational costs.

There's some estimates here. 10,000 H800s, 10,000 H100s with large orders of H20s in progress. H800 has the same compute as the H100 but less network bandwidth. The misleading six million figure was widely circulated as the cost of V3, but that doesn't include R&D, hardware depreciation, repeated experiments. Actual total spend is far higher. But at the same time, just to break it down, R&D is the cost that they're spending on their team, which is undoubtedly one of, you know, in the, like I would imagine in the billions of dollars a year based around.

I mean, they had $944 million in operational costs. So yeah, that's the OPEX is probably the mostly R&D and salaries. They have 150 people making a million dollars a year. And so right there, that's $150 million. That we know of. They also have been aggressively lying. and now the truth is coming out a little bit, but we still don't know the full truth. Yep. I think this is probably correct. I'm inclined.

This feels correct. Yeah. And so it's easy to lean into this and be like, you know, Dylan Patel is saying it's not 5 million or 6 million. It's actually closer to 500 million or a billion. And it's easy to be like, no, it's even higher. It's 50 billion.

And it's like probably not that high. But it is interesting. And so in terms of my mind. Model performance, Deepseek V3 is the base model, while R1 is the reasoning model. We've been through this. And they have a couple genuine innovations here. So these are the things that you need to see.

These are the buzzwords that are gonna be going out in the AI influencer space. So this weekend, start sprinkling them into conversations at home. Yep. They may, they probably won't land, but you'll sound smart. And then come Monday, you'll be able to just sprinkle them in in the workplace and really start, you know,

working them into the- Yeah, you gotta let people know that you, you use the, these words so frequently, you got to use the abbreviation. So multi-token prediction, MTP, Tokes. Tokes. Tokes. Tokes. Tokes. Yeah. Multi-tokes prediction. Multi-tokes. A mixture of experts, just call these perts, specialized sub-networks, quote-unquote, experts managed by advanced gating networks. You could say, oh, yeah, my perts are gated. My perks are gated. I mean, the funny thing is that real ones will know exactly what you mean. Yeah. And so it's a good way to filter out.

Who's LARPing and who's really, you know, at the forefront of these broader trends. Yeah. I mean, like the mixture of experts was was described in detail by George Hots when GPT4 dropped. And he was saying that there were some hardware limitations to how large you could scale the models. And so they were effectively training six or 20 sub models and then wiring them all together with this mixture of experts thing. And so I've heard that term before, like outside of this. So that's not entirely new, but it does seem like combining all of these or what allowed them to create a great model.

And then multi-head latent attention, MLA, you're going to be hearing a lot about that, drastically reduces KV cash memory, 93.3% less, slashing inference costs. And that's obviously very important. And so at this point, V3 is reportedly passes GPT-40 from May 2024, although AI evolves fast and many new models have also improved drastically since. And there's this reasoning shift going on where post-training synthetic data like RL is getting cheaper than giant pre-training runs letting R1 quickly match others like O1. Openweight's advantage. Deep Seek is now considered the single best open weights lab beating out Metas Lama and Mistral. Although Zuck had a few

things to say about that, he claims that Lama 4 is going to blow him out of the water and that he's still investing in CapEx. And Zuck loves to deliver. He's done it many, many times. So that feels believable as well. And so... He kind of has to, too, to save face. He's got to drop something like truly competitive.

Yeah. Not just, oh, great, you have distribution. You'll get users for it, but it's not best in class. With the amount that he's spending, which is something like $60 billion a year, he's got to show results, as well as the meta executives that are all sitting there making five million plus a year and facing that pressure internally to perform. Yeah, I mean, people, you got to go back in the timeline when meta dropped the first Lama model because I remember the exact same hype cycle happening where people were really rooting

against Sam for a variety of reasons. And people were rooting for Zuck for a variety of reasons because he was like on this Gigachad arc and there was this whole this whole narrative of like oh Zuck it would be a shame if I destroyed your entire company like opening I is going to zero now because Lama's out there and it's free and you can just inference it and then I remember there was a Rune tweet at the time saying Like have you talked to that thing like it's not that good like he was kind of playing like defense Obviously it got better and at this point it's it's pretty good But it had the same narrative as like as like oh if there's an open source model it's game over for the close source models and that didn't really play out because there was obviously the app layer and then

all the yeah open eyes clearly not just a model company they're shipping products yep against against the underlying model and they do seem to be able to stay six months ahead or so so you know v3 surpasses gpt 40 but gpt 40 is almost a year old now may 2024 and it's crazy already despite the mind-shared dominance among outside of teapot is insane with chat GPDs. Totally. Like I talked to a founder yesterday and she's like, it's acting as a co-founder for me. And I'm like thinking out loud, talking to it all day long about what I'm building. Yep.

And yeah, she could go and use, you know, Lama or any of these alternative products. And it's just for some reason it's not getting traction in that same way. Yeah. And so let's let's break down. a direct comparison between R1 and 01, Deep Seek's model versus ChatGBT. Again, I think a lot of the narrative of DeepSeek just killed Open AI was driven by the fact that it was free.

It was free, yeah, exactly. And so a lot of people hadn't upgraded to the $200 model, 01 Pro. And so they were just like, well, I'm not going to spend $200. That's too much. It was a cost of the training run that everybody saw was really bearish because U.S. companies are spending. And then there's the China Dynamics. Yep. And then there's the, then there was the concern around, you know, a lot of people just trading against the news, not really trading against Jevin's paradox, right?

And then there's a cost of like, okay, if you introduce a free product that's on, that's better than the free product of your competitor, what happens. Yep. But consumer behavior is not always entirely rational. Yep. And especially in the context, I just don't see, it's still hard for me to see Deep Seek, you know, becoming truly sticky and dominant, right? Totally. Because ChatGPT among consumers is a very loved product.

Yeah. And you can't underestimate consumer love because so many people have had magical experiences. If you go, hey, you can use Deep Seek and it's better, but they're like, well, I already love, I already love ChatGPT. Exactly. It does exactly what I want. And it's learned a bit about me. Some of my data is in there already.

Oh, and also there's a little share button. So when I generate something with chat GPT, I can share the link that onboard you. And the value for us, it's like, okay, for $200 a month, we would happily, for the same service pay $2,000 a month. So by telling us that we can get something

that's comparable for free, the value tradeoff is like not that significant. I only want the best most cutting edge model that has the most features at any given time. But a lot of people aren't in that boat. A lot of people do just want whatever's free. So is R1's performance up to par with 01? I want to read this pretty much this whole paragraph here.

On the other hand, R1 is able to achieve results comparable to 01. And 01 was only announced in September. How has Deep Seek been able to catch up so fast? The answer is that reasoning is a new paradigm with faster iteration speeds and lower hanging fruit with meaningful gains for smaller amounts of compute than the previous paradigm. As outlined in our scaling laws report, the previous paradigm depended on pre-training, and that is becoming both more expensive and difficult to achieve robust gains with. The new paradigm focused on reasoning capabilities through synthetic generation and RL in post-training on an existing model allows for quicker gains of the lower price.

The lower barrier to entry combined with easy optimization meant that deep seek was able to replicate 01 methods quicker than usual. As players figure out how to scale more in this new paradigm, we expect the time gap between matching capabilities to increase. Note that the R1 paper makes no mention of the compute used. This is not an accident. A significant amount of compute is needed to generate synthetic data for post-training R1, not to mention RL.

R1 is a very good model. We are not disputing this. And catching up to the reasoning edge this quickly is objectively impressive. The fact that Deepseek is Chinese and caught up with less resources makes it doubly impressive. But some of the benchmarks R1 mentions are all. also misleading. Comparing R1 to O1 is tricky because R1 specifically doesn't mention benchmarks that they are not leading in. And while R1 matches in reasoning performance, it is not a clear winner in every metric. And in many cases, it's worse than O1. This was your actual user experience

where you were trying it and seeing, okay, this output is not on par with what I get from chat GPT 01 pros specifically. And my prompt was not something that's baked into some math, eval, or physics test. It was just, can you summarize this book in 5,000 words? Did you give me 5,000 words? And was it, was it factually accurate or not? And 0-01 Pro gave me exactly 5,000 words, a little bit more, it's great. And Deep Sea gave me a thousand words. And it's like, how, how am I? It failed the test. It failed my prompt. A functional, yeah, functional test. Exactly. And then, and then add to this. This is, again, from a consumer standpoint, you're not going to notice these small intricacies in terms of, you know, having the model run at 50 physics problems because you wouldn't necessarily wouldn't have been

able to get any of them yourself. So it's almost irrelevant. What matters is actually the output, which is what people want and what they're paying for around specific problems that they need the model for. Yeah. And so and this doesn't even include 03, the latest model from Open AI that hasn't been fully released yet. O3 has significantly higher capabilities than both R1 and or 01. In fact, OpenAI recently shared O3 03's results and the benchmark scaling is vertical. Deep learning has hit a wall but a different kind.

And so then there's also the question of Google's. Great line. Yeah. I'm Dylan. Google's reasoning wall. Looks like a wall by the way. Yeah, it's completely up into the right. It's fantastic. But it's on Arc AGI, SWI, SWI,

Swaybench, and Frontier Math, Advanced Mathematics, like things that most consumers might not even care about the benchmarks. but are potentially good proxies. Because a model that can do insanely advanced mathematics might be better at generating a recipe. And so Google jumped into the game to very little fanfare. They did not really break through.

Really struggling on the marketing front? Totally. And so while there is a frenzy of hype for R1, a $2.5 trillion US company released a reasoning model a month before for cheaper. Google's Gemini Flash 2.0 thinking. What a fantastic name, guys. I don't know why it didn't take off.

You got 12 different words that no one knows what they mean. It's possible that Clippy is like no longer able to be trademarked. So Google should just take Clippy for its next model. So the model is available. It's considerably cheaper than R1, even with much larger context length for the model through the API. Again, I'm signed up for Gemini Advanced Pro Plus plan. I pay for it.

I have no idea if I have access to Flash Thinking 2.0. and I have no idea how I even go and find it. If I, if I Google it, I'm going to get the paper. I'm going to get some tweet. Like, it's, it's so hard to access Google's models. It's so embarrassing for them. Get it together, guys. On reported benchmarks, Flash 2.0 thinking beats R1.

I remember Peter had a fantastic, Peter Thiel had a fantastic, like, distillation of what's going on in AI, where basically all the different AI labs are, you can think of about them as like lemonade stands and they're all obsessed with perfecting the formula for lemonade and none of them are thinking about where to actually place the lemonade stand. When you're running a lemonade stand, all that matters is that you're on the busiest corner. Location, location, location. Yeah, yeah, yeah. And that speaks to distribution. Not even the corner. What neighborhood you're in. Exactly. Exactly. And so you can you can imagine that at Google, they're like, Gemini Flash thinking 2.0, we beat this benchmark. It's amazing. Everyone's going to love it.

It's like that's not how products work, guys. That's just not. Not like no one is like I'm gonna go figure it out at some point, but it's gonna take me 30 minutes to find this product and figure out that I'm using it. And again, you don't, you have access to Open AIs reasoning model. So you can just use that. Yeah, exactly. It's easier to access. Exactly. Your data's already there.

Yeah. And then now in every single Google product, there's some sort of pop-up saying like, hey, do you want to use Gemini for this? Do you want Gemini to work on summarize your emails? And I'm like, well, which Gemini? You guys have 17 different products. And like, how is it going to integrate? I know.

I'm, we're dealing with this email related bug right now. Yeah. For TV related to a new domain. Okay. And I keep, everything is set up properly, but it's not working. And they just keep sending me the pop-ups of Gemini. And I'm like, you know. You can't get the basic, like, level one.

Maybe I should actually try with Gemini. Hey, Gemini, fix this. Fix this. Yeah. And so on reported benchmarks, Flash Thinking 2.0 beats R1, though benchmarks do not tell the whole story. Google only released three benchmarks, so it's still an incomplete picture. We think Google's model is robust, standing up to R1 in many ways, but receiving none of the hype. This could because of Google's lackluster go-to-market strategy and poor user experience.

But also R1 is a Chinese surprise, which is huge advantage. To be clear, none of this distracts from deep-seek's remarkable achievements. Deep-seek's structure as a fast-moving, well-funded, smart and focused startup is why it's beating giants like meta in reasoning and releasing a reasoning model. And they did beat meta. Like Lama 4 still in training, they haven't released a reasoning model, and it certainly would be cool. If this had just baked itself into... At least Zuck is breathing a sigh of relief, knowing that they actually spent the money

while. However many billions getting this model out. Oh, yeah. He's like, okay, we're not totally crazy. No, no, no, spending 60. And I think that's why the stock popped in earnings. I mean, earnings were crazy, but I think everyone was very excited about like his positioning on the AI infrastructure investment. And so Deepseek has cracked the code and unlocked innovation that leading last

have not been able to yet achieve. We expect that any published deep seek improvement will be copied by Western Labs almost immediately. What are these improvements? We covered a little bit of these training pre and post. V3 utilizes multi-token prediction at a scale not seen before. These are added attention modules

which predict the next few tokens as opposed to a singular token. And so you can imagine the old version of auto-complete on the iPhone. it would say, you know, would you like to go to and it would have like breakfast or lunch pop up. But now you, but you know, you see some of these models where it's predicting three or four words. It's kind of like that, but baked into the model at a very, very low level. So it's just more efficient because it says, oh yeah, after this sentence, usually there's just this, you know,

three words that go together. And all of those go together. There are added considerations like doing FP8 accuracy and training. We talked about this. Leading labs have been doing. doing FPA training for some time. So that's a little bit overhyped. There's a lot of things where people just went through the deep seek paper and everything that they were doing they assumed was novel. And they were like, oh my God, they're using data to train it. Like no one's thought of that.

And it's like, no, everyone's using data. Everyone's scraping the web. Everyone's, you know, like running it on GPUs. And the synthetic data side as well. Yeah. And so. And I don't know if this is going to come up later in the show, but some lab at Cal. was able to generate a reasoning model with 450 bucks.

Yeah, I love that. So anybody working on models out there, we're good for our 450. Yeah, for our 450. So rather than decreasing overall investment mixture of experts, which is where one large model is comprised of many smaller models that specialize in different things, and this is an emergent behavior. Historically, MEO models have faced struggles about how to determine which token goes to which submodel or expert, DeepSeek implemented a gating network that routed tokens

to the right expert in a balanced way that did not detract for model performance. So basically, you're getting, like, instead of activating the entire model, which is very expensive, requires a lot of energy, you're just activating like one little section of the brain. But despite concerns that MOE efficiency gains might reduce investment, Dario over at Anthropic, points out that the economic benefits of more capable AI models are so substantial that any cost savings are quickly reinvested into building even larger models. This is Jeffens Paradox. Rather than decreasing overall investment, MOE's improved efficiency will accelerate AI scaling efforts. The companies are laser focused on scaling models to more compute and making them

more efficient algorithmically. In terms of R1, it benefited immensely from having a robust base model, V3. This is partially because of reinforcement learning. There were two focuses here, formatting, ensuring that it provides a coherent output and helpfulness and harmfulness to ensure the model is useful. As mentioned in the scaling laws article, this is what happened with 01. Note that the R1 paper, no compute is mentioned. This is because mentioning how much compute was used would show that they have far more GPUs than their narrative suggests. And Vibyas wouldn't have had billions and hundreds of billions wiped out of its market cap. Yep. And Dylan also says that additionally a portion of the data deep seek used seems to be data from open AIs models, which of course

makes it easier because you're just cloning the outputs. And so you're optimizing against like a very set benchmark. If you want a GPT4 model and you're training on all GPT4 data or a lot of GPT4 data, you're going to get a lot closer to GPT4 pretty quickly. Which again is interesting because they would have had to spend a ton of money with open AI, right? Yep. Which we've talked about before,

the same thing that TikTok did to scale. Yep. They just spent billions on user acquisition on Snapchat and Instagram. Yep. And it's this weird dilemma that the other platforms get in where they're like, well, we'll take the billions now. And even though we're going to lose out on, you know, potentially billions later.

Yep. And so he concludes with a couple different takeaways. Deep Seek's cut rate pricing may be zero or negative margin, partially to gain market share and investor attention. And then he highlights Jevin's paradox again, talking about the AI race is similar to semiconductor fabric. cutting edge nodes, command premium margins, everything older quickly commoditizes. And that's like the story of TSM versus Intel.

This dynamic spurs an endless cycle of scaling up new models and hardware investment, benefiting chip providers like Nvidia. There are exports restrictions. H-100s are fully banned. They've been replaced by H-800s. H-800s, I think, were banned, and then the H-20 was introduced. More stringent U.S. bands may come. It depends. We haven't seen exactly how the government will react to this.

It's a really funny dynamic that our government doesn't want Nvidia selling them great chips. Yep. So why is it okay with them selling them any chips at all? Yep. And what, you know, assuming that they can. I mean, the steel man here is that if you're Nvidia and you're Jensen Long and you've been building this company that you control and own for 30 years and for 29 of those years, the government has been telling you, go global.

We want you to be as big as possible. Get those tax revenues up. Higher people. It's cool. These are our allies. The internet's going to make China democracy. And they're part of the world trade organizations. So absolutely go manufacture over there, do business with them.

We love this. We'll put you in touch with the ambassador to China. And then all of a sudden, run poll you. Like that's kind of harsh. Yeah. And so unwinding that relationship. And it would.

And if Nvidia had a blanket ban on selling to China or any countries in close enough proximity to China that they can act as a proxy, it would destroy. I mean, it would wipe potentially trillions out of the market. See, I might actually disagree with that because I think you're right that they wouldn't be as high of a stock,

but there's an interesting dynamic where the best time to de-leverage from China was when there's insane demand in America. And that's what happened during the AI boom in 2023, 24, where if there was ever a time to say, hey, we're going to pull back in China, it's when, it's when Elon Musk and Oracle and everyone is sitting down and be like, we will buy every single GPU you can make. Yeah, yeah.

So the Altman needs two, he needs two million GPUs just in Abilene, right? Yeah, exactly. He'll buy them all. Nvidia is going to produce six million total this year. Yep. Right? So just one guy could potentially be a third of Nvidia's. And he's not buying those all this year.

it's going to be spread out over time. I need a steel hat to put on when I'm steel manning. Because again, the steel man here of why would Jensen not want to do that? Obviously, people have been very critical of him not putting America first. But the flip side is if you do say, okay, I'm only going to sell to these crazy American AI companies and then there's a bubble and it pops. You are more fragile than if you have a diversified revenue base. It's not like the United States and China have declared war on each other.

It's just this great power conflict that kind of moves along slowly and everybody tries to kind of allies, not enemies. We're also dependent on so much. I mean. Totally. And so this is an interesting stat. I didn't, I hadn't heard about this, but the Bank of China announced a one trillion yuan, 140 billion US dollar AI subsidy. Let's ring the size gong for China. The one T.

Hey. Size is size. Size is size. Size is size. The size gong does, is nationalistic. Zizgong rings for everyone. Yeah. And if anything, we hope the ringing sound inspires one of our listeners to invest a trillion into something.

Exactly. And so 140 billion subsidy, AI subsidy, after meeting Deep Seeks founder. So the guy literally goes and pitches the government. This all seems very, you actually put up 140 billion. And he's like, yeah. conveniently timed, right? It's their Stargate. You have, yeah, you have, Sam Altman gets Trump to do his press tour for him.

less than a week later, China meets with the Deep Seek founder and announces something very similar. Yep. But interestingly, this is the Bank of China putting up a subsidy of $140 billion. Trump hasn't put up anything for other than just his name and a couple minutes in the PR room. Sam Orra farmed him. He orr farmed him. Whereas the Deep Seek founder gold farmed him, basically. So China has a gold.

of self-reliance and advanced technologies, obviously, and this aligns with that. And so despite large GPU stocks, scaling to serve millions of new users is tough. Future export controls may starve them of advanced chips. And there's a big question about, was this an aberration? Will they be able to keep up? A lot of that's predicated on can they either get around the export controls reliably at an order or magnitude larger scale, or can they get Smick and Sme, their version of TSM and ASML? Can they get those chips up and running and start making competing competitive? competitive GPUs internally. Because if they can do that, it's game over.

Like, they can make a billion chips. And with something like $140 billion of like demand. China is world class at copying. Totally. And that's all they have to do. And I don't even say that in a way to slight them. No. But that is historically what they've done over and over and over.

Yeah. And they have ASML machines. They have TSM machines. This is what they're copying. Entrepreneurs, you develop some hardware product or consumer product. Go to China. You see your factory. If you walk to the factory,

next door, they'd probably be producing your exact item. Totally. Almost one for one within a year if you're actually really selling well. So it's just roofless. They're good at it. I'm sure they're going to have their own invidia, TSMC. Yeah. So let's close with some of these conclusions.

Inficiency does not mean reduced investment. This is Jevin's paradox. Cost savings from new architectures like mixture of experts spur more scaling, not less. Fast follower. Deep Sea lags top labs, but closes gaps swiftly with new paradigm reasoning. Their open source stance accelerates industry-wide progress. Frontier capability commands premiums, but deep-seek's low pricing disrupts incumbents,

potentially forcing big labs like OpenAI to innovate even faster, and we're seeing that. There's going to be more pressure. Hey, release 03, get it on the free tier, get an ad product in there, do something to bring this to the masses so you can cut stem the bleeding of people installing the deep seek app.

Long-term outlook, hardware demand isn't going away. Quote, more advanced AI, more GPU spending, more scaling. Export controls will likely tighten, but we're going to need to see where this shakes out. I think Jacob Helberg might be on the team that's working on export controls and tech deals globally. We actually need a rack of GPUs on the set.

I think we should get some H-100s and just replace that cash with some... A couple of GPUs. With a couple of GPUs, yeah. Yeah, great. And so we think the East versus West debate in AI models will continue and the new paradigm is good for invidia very interesting so fantastic analysis from dylan patel highly recommend subscribing to semi analysis if you haven't already it is a great

resource and we love to see deep dives on the timeline a great poster too yeah he's great poster yeah follow him DM him the technology brother sent me exactly exactly uh comment on on his post um so uh let's to drone horizons a great piece in pirate wires another another outlet that you should definitely be subscribed to this one by G.B. Rango fantastic name. Great name. Pirate wires says drone horizons are deep dive on how drones will change the future not just in war but in everything from construction infrastructure and interplanetary space the widespread adoption of UAV technology piggybacked on the inexorable AI surge could significantly retool both

international power relations and the daily lives of regular people in a manner that you understand. Today in PirateWire's G.B. Rango systematically outlines the trajectory of inevitable drone developments that are going to permeate every pore of society from agriculture to medicine to policing and national security. And firefighting, which is particularly relevant to the last month we had here in L.A. And so let's kick it off with G.B. Rango's lead, which is a little anecdote here The stadium is a roar with 80,000 raucous attendees and casts a short shadow in the midday sun. In the distance, peppered specks rise from nests unseen before gathering over the horizon like iron filings in a magnetic field. Small payload drones, hundreds of them, race balefully forward.

The orchestrated swarm twists and folds in hive-like unison as it approaches its target. In response, nearer to the stadium, another group of drones ascend. ascends in concert and rushes to meet its hostile counterpart. The confrontation is swift and casually anticlimactic, with only a few citygoers caring to notice the whirer of propellers or the hissing and buzzing of the interceptor's high-powered microwave pulses. The sky is clear once again, and the game goes on uninterrupted. The emergence and facile neutralization of drone threats is commonplace here in a potential future. This cross-section of a shocking and interterminant future and those to follow are meant to demonstrate and warn of the transformational nature of an imminent of an imminent drone age shift.

Darjestein. Pretty crazy. But I think this is one of those things where you see one side of the technology development and you don't realize that there is the flip side that's countering it just as aggressively. Like in 2000 or the or the, you know, the 2000s, the 2010s, if every day you were reading articles about email spam. Yeah. And you had no knowledge about spam filtering and the fact that that was possible, you would be like, wow, why would I ever sign up for email? Like it's just going to get worse and worse and worse.

But of course, it's an arms race and there's anti-drone technology, which I think we'll talk about as well. And so I'm not quite as black-pilled as some people on this front. I also find it hard to imagine this future. If you put in the context of how dissimilar would it be if somebody launches a hypersonic at a stadium of people and we launch some type of countermeasure and stop it. That would be national news.

So I would hope we don't experience this future because, and in this illustration, the stadium doesn't even notice, right? But just very dark. But this is like the threat. So it's worth, you know, really paying attention to. And there are, so he breaks it into six or seven different sections. We'll give you a little tour of the article

and you can go read the full post on pirate wires. It says an infrastructure and agriculture, infrastructure development will undergo drastic changes with the advent of advanced and ubiquitous drone technology. Construction sites strangely devoid of human laborers instead populated by powerful heavy lift drones. Nimble inspector craft and bipedal robots will be more productive, efficient, and safer than ever before. Gargantuan cranes with arms outstretched, fresh metal glinting through measured pivots rotate powerfully over the earth he's such a good writer this is why I love this style of writing it just takes you on like this this tour and yeah you can really visualize it yeah it's like it's really like pleasurable to yeah and it's already can you imagine the drones

you know working this construction site they run into an issue they need some type of human intervention and you're the human that's on call and you get a call from this nice sounding robot voice and they're like hey bud you mind stopping by the site for a few we could really use a hand here it's like a human voice And then, you know, hopefully after you finish as a human that the drones are nice enough to say, hey, thanks, bud. Yeah. Probably won't need you anymore today. But, you know, appreciate you stopping by. Yeah.

And this is the flip right now. We tell, you know, we tell the models what to do. Yep. Eventually they'll tell us what to do. We are the APIs. Yeah. But, I mean, there is, obviously, there's like there's the job displacement question. But the flip side is like, I think every, almost every single time a major.

skyscraper is built, there is a single digit death toll from workers just because it's so dangerous and you put 10,000 people on a construction site for five years or something and like things are going to go wrong. And so there is a pretty significant opportunity. Even even in oil and gas, right? Yeah, totally. On these fracking, every now and then a video will go, you know, super viral and it's it's an active, you know, fracking site and just that kind of action that's going on where there's heavy machinery whipping around. Super dangerous. Yeah, it's just super dangerous. So he says in the agriculture world, in the coming age,

farms will not sleep when the sun goes down. Drones will work around the clock to protect crop yields and monitor livestock. Rustic family barns sitting bare on flat plains will look like nocturnal beehives with luminous agents approaching for payloads before dutifully buzzing back into the dark. These small flying machines will flit nonstop through thousands of crop road acres addressing issues like pest treatment, disease, and water shortage on the individual plant level. very cool and so we got to get him to describe

us yeah what a great writer seriously John threw on his jacket yeah and yeah and this next segment on emergency medical services was actually highlighted on pirate wires drone delivered organs should be standard protocol for transplants and he says over 46,000 organ transplants were conducted

in the United States in 2023 quicker transport times are associated with better patient outcomes in and in the sort of major delay described above is not unheard of. In 2023, a pro-Gaza ceasefire protest on the San Francisco-Okl Oakland Bay Bridge blocked all westbound traffic for four hours. Three UCSF organ transplant deliveries were significantly delayed, one of which had to be rerouted over the Golden Gate Bridge. But one transplant surgeon at UCSF noted that two other large transplant centers in the Bay Area,

Stanford and CPMC, were probably suffering from the same issues as well. Now, while no known complications have been directly attributed to the protest. The proliferation of drone technology will completely eliminate the transport delay risk opposed. A lot of this stuff, a lot of this stuff happens via helicopter now. And there's even there's companies like Blade that actually have a really, I think at one point, Blade's organ transplant business was bigger than their consumer business during, I think it was COVID. Wow. Might have that off. But yeah, this is actually a very big business already, but it's kind of funny to think about, you know, needing to fly in Oregon from one side of a city or county to another and you just put it in a helicopter. Like, it's not the most

efficient if you're just basically needing to transport the equivalent of like an ice chest. Yep. Yep. He goes on to explain search and rescue, maritime efforts, larger boats serving as bases at operation for small drone swarms that can expand radially outward and aid in the geographic process of elimination. Larger unmanned aircraft systems with multi-day endurance will work. working concert with these teams to survey vast areas of open sea for survivors and identify points of interest. That just seems like a new capability. Yeah. This doesn't see my job replacement. You have a bunch of pilots that go up in their planes and they take turns just taking, you know, basically running. Yep, there's some sort of like grid search they have to do,

but it's a funny path. It's not just like what you have to be high up enough to get enough coverage. But in a world where you can send a thousand drones, you can be much lower. Almost instantly scan huge, huge surface area. So this would have been useful during hurricanes. Helene and Milton, both of which struck in the fall of 2024, and drones were pivotal in the preparation for in response to these disasters. He goes on to explain that drones will have an impact on firefighting, which I think we discussed previously. And in America, fire department use of drones is almost exclusively limited to the realms of surveillance and intelligence gathering in the wake of the recent Los Angeles fires, which have reportedly resulted in the deaths of at least 24 people and reeked over $250 billion of economic damage. This last last, A lack of progress. What? Two weeks ago was at $150 billion. So it's still climbing.

Wow. Climbing. Compounding this international delta is the fact that across all U.S. public safety agencies, 90% of drones in use are designed and manufactured by DJI, a company that was recently added to the Department of Defense list of Chinese military companies. While that number is from a 2020 survey and steps are being taken to limit Chinese drone usage,

the status quo remains largely unchanged. So he goes and to talk about foreign dominance and how they can, how drones will be effective in the military, talks about regulation of drones and drone deliveries as well as policing and the state. And finally, national security and war. National security, of course, is of paramount relevance in the discussion of drones. The nature of war is changing faster than it has at any point since the post-World War II nuclear proliferation. and drones are one of the major cruxes of this change. It is essential that America not rely on China

for any segment of the defense supply chain, let alone UAS design and manufacturing. Yeah, and this goes back. I posted a while back and it resonated. We needed a Stargate for domestic drone production. Yep. And the reason for this is that if we were in a conflict with China, they could produce presumably millions of drones a month

and we can probably right now produce. I don't know if we needed, to turn it on and produce locally. Yep. But however, it would be a fraction of what China could produce and the capability would not be there. Yep. Which is just a terrible place to be in.

Like a huge part of the reason that we were successful in World War II was because we were able to turn on this massive, you know, manufacturing capacity and just out, out produce our, outproduce the competition. Yeah. This is interesting. He ends with space and visions of the future. Below the arcing of stars and spirited space adventuring of generations to come,

the skies are clear, save the birds and an occasional transport drone, passing silently overhead. Towering bio-hybridged buildings draped with verdant ivory, attended to by swaths of assiduous airborne robocardiners, looks as if they might have emerged in search of sunlight from the earth itself. A period of peace, less fraught with tension than its Dr. Strange Love type predecessor, has settled upon the world. This is not for want of bad actors, but for their inability to find secrecy. And he closes with now, with all of this having come to pass, there seems to be an

almost palpable optimism, a sense that things can change, and that we have a significant say in how they change, a weird coalition between humans and their hive-minded, autonomous aircraft. Once an unnerving prospect now powers the world forward in ways that not even the most visionary among us could have seen in a crystal ball. This or something else entirely lies ahead of us with courageous optimism. We step into drone-filled horizons. So clearly, G.B. Rango should write some science fiction because we'll read it. So good.

One thing that's interesting, too, there's already technology that's been developed to make drone silent. So it's some element of the way. Perpeller design. Yeah, yeah, the propeller design. It's very crazy. And so right now it's actually nice that you can tell when a drone is, I've had situations where a drone flies over my backyard. Yeah. I got there and I look up at it. I'm like,

get out of here. Get out of here. Scram. Scram. Yeah, get off my line. It's not much you can do. But imagine when they're completely silent, you're just, you know, somebody can fly it over your backyard on a, on a battlefield. It's pretty terrifying to think about, you know, this kind of assassin that can move at 100 plus miles an hour instantly take you out without you even hearing about it. So very dark but uh good time to get so one thing i would say uh kind of a call to action for the audience it's seen there are a lot of new american companies taking on this issue developing drones for all these different use cases if you look at augustus and rainmaker they're developing drones for cloud seeding and agriculture we like that we could probably have 10 10 to 100 you know 50x more

drone companies attacking all these different areas everything from like the production down to the parts level, all the way up through these sort of like app layer, product layer companies for organ transplants, you know, sorry, not transplants, transports. Transports, yeah. Well, transplants, yeah. Yeah, that's right.

Yeah. Cool. We'll go give it a read on pirate wires. We love pirate wires and highly recommend that you subscribe. It would be just crushingly embarrassing to get caught, looking at a pirate wires pay wall in front of someone in tech. Brutal. You don't want that to happen to you.

Yeah. And if you ever run into Salana, He has the ability to just search your email in the database and he'll know. Yeah. So you can't fake it, guys. Can't fake it. You got to be real, real subscriber. So let's go to Stretecery, breaking down more tech earnings from big tech, the hyperscalers.

Microsoft and meta earnings went live and Ben Thompson broke it all down. And I don't know what day it was. We already covered a lot of that as earnings. So we can kind of rip through Microsoft and just give you a quick update from the Wall Street Journal. Microsoft's flagship cloud computing business experience. to slow down in growth last quarter as constraints on data center supply once again weighed down results. Revenue for the tech giants, Azure Cloud Computing Division, which is closely watched by investors, grew 31% at the low end of the company's projections. Chief Financial Officer

Amy Hood said Azure growth would again be 31 to 32% this quarter, a projection that disappointed investors. Microsoft stock was down 4.5% in after hours trading. Fortunately on public, you can get in the after hours action now. They are allowing after hours trading. So first off, Ben says, Microsoft said the AI growth was capacity limited, but would be rectified by mid-year. It's nice to not have to be on the hook for that new open AI data center.

But the bigger miss in Azure was somewhat obscure, but interesting in its own right. Basically summarizing the Wall Street Journal, Ben says, Microsoft pivoted their scale motion. Think small and medium-sized businesses second-tier geographies to be very focused on AI instead of boring old cloud migrations and they didn't get many takers. So they're going to second-tier geographies outside the United States and they're going to small and medium businesses and instead of saying, hey, you have this

data on this old server, let's get it on the cloud. They are now shifting to a model of saying, hey, can we get AI installed in your teams integration? Can we get AI installed in looking at all your data, running, streaming analytics, looking at your enterprise? And that's a hard or sell for a lot of businesses that are just, hey, like, I kind of have, I'm running on vibes. Like, I'm the AI. I know if revenues down, I kind of know why. I don't necessarily need to dig you everything. I'd love to see an AI have a power lunch. Exactly. It's a harder sell. Apparently, that's what we're seeing, could turn around. We never know. Yeah. So now they will go back to just selling actual cloud services and expect to see a revenue rebound. Count one for my thesis

that bottoms up AI adoption will be a hard sell. And this is also why there's those private equity roll-ups VC-backed roll-ups that are that are buying companies and then forcing them to use AI because it seems to be a hard sell from an outsider. And so you could always ask, hey, why is Long Lake rolling up HOAs and then dropping AI on top of it? Why don't they just build AI for HOAs and then sell into the existing HOAs? Well, maybe the sales motion is very difficult. Maybe they want a new model. And so if they own the company, they get to convert them. My HOA management company still runs on paper sent in the mail that has to be sent back to them and then processed. Yeah. It's like, the easiest software integration to just allow online surveys.

But if you have rolled that out. So imagine how many HOA software companies have pitched them. Totally. You could be way more efficient. You could save money here, all this stuff. Don't care. Yeah.

And they say, oh, you're trying to pitch me some e-signing software. How many employees you got? 50,000? I'm not interested. Yeah. It'd be too expensive.

Get those numbers up. Yeah. So on the flip side, Satanadella claimed good progress with copilot adoption. We are seeing accelerated customer adoption across all deal sizes as we, win new Microsoft 365 co-pilot customers. Once again, however, Ben says there was no actual real number shared. I'd love to see them.

Beyond that, I do want to express gratitude to Microsoft for introducing a new term, new terms of art. Database fungibility. I'm surprised they're not getting pressed harder on that, considering it's such a major element of their AI strategy. Wouldn't the analysts kind of push? No, you can totally push back. Until the SEC says you got to break out the revenues,

you don't want to share anything. This is the classic Google, YouTube, AWS, Amazon thing. Like Amazon did not want to break out AWS data. Because even though like you could hire someone from AWS and they could tell you like, yeah, that thing was really profitable, that doesn't ring as true as every day seeing the stock price and every quarter seeing AWS just print profit. And that gets Google and Microsoft off the couch and they say, well, I know for a fact that that that AWS is massively profitable.

We got to build a competitor instead of just, oh, I've heard whispers that they're making lots of money. Yeah. Right. Very different. Because Bezos, that whole time was reinvesting all the profits, so it wasn't showing up.

It was hiding. It's just tough because, I mean, on the co-pilot side, they're selling into existing customers, right? So it's an upsell, which is different than, okay,

if you want to go compete with them, really on co-pilot, in many ways you have to own the underlying company-wide people, infrastructure to some degree, right? Like you need to own teams so that you can upsell the co-pilot for teams integration. Yeah, and so Sata continues to get hammered with questions

about Open AI and the relationship there. And they posted, so Altman and Nadella Altman and Nadella posted a selfie together. Yep. Trying to, you know, clear up. Hey, we're buddies. We're smiling. We're happy. It's not. It doesn't count unless there's, the, the, the Della mugged Altman on TV. He said, yeah, the bar for like the CEO to CEO selfie has gotten so high. It's like, I want to see you doing jiu-jitsu together.

I want to see a jersey swap. I want to see that leather jacket on you. I want to see, I want to see Sata in the passenger seat of the rigara in the Konigseye. We need to see pop-orosity shots of them. Yeah, I want to see Sam hitting 200 miles an hour in that thing and Satcha scared out of his mind. Then I'll be like, okay, yeah, these are boys. They're boys. They went to the track.

They did a track day together. And Satcha trusted Sam to put up five. G's in the corner. Satya let Sam ride his favorite thoroughbred. Exactly. Exactly. Yeah, it's not, you can't just take a picture in a boardroom. It doesn't work like that anymore. Step it up, guys. So, Sauta answering about Open AI, he says, but to your overall point, the thing I would say is that we are building a pretty fungible fleet, right? Like, don't worry, we can move our fleet anywhere. We're making sure that all the right, that there's the right balance between training and inference, it's geo distributed. We are working super hard on all the software oppositions, right?

I mean, it's not just the software optimizations that come because of what DeepSeek has done, but all the work we have done too, for example, reduce the price of GPT models over the years in partnership with OpenAI, which is true. They've done a lot of optimization to serve GPT through Azure. Do we know exactly how much Microsoft owns of Open AI? Because there was that one weird investment where they basically bought seemingly, I forget the exact structure, but it was like 10 on 20 or something. The way I think of it is like there's kind of three.

important parties around the table with the Open AI for profit. It's like the like the founders, employees, like the shareholders, the Microsoft and then the nonprofit. And then the actual investors are like pretty small in that. But you can think about like those four things. And they're like roughly balanced. There isn't one person or one organization that has like outsized control. I think the whole meme of like it's it's entirely controlled by the nonprofit or it's entirely controlled by Sam or it's entirely controlled by Sautja is maybe a little bit oversold. And it's a little bit more of a balance. Because when, the nonprofit conversion happened, there was like a big debate. And you get four people around the

table, oftentimes if everyone has like roughly equal leverage to kind of veto, you kind of wind up with roughly equal positions. But I don't really know. Anyway, in fact, we did a lot more work and inference optimizations on it. And that's been key to driving, right? One of the key things to note in AI is you don't just launch the frontier model, but if it's too expensive to serve, it's no good, right? it won't generate any demand. So you've got to have that optimization so that inference costs are coming down. He's using some specific communication strategy. Tell me.

Keep saying, right? Yeah, yeah, yeah. And it makes you inclined to agree with him, right? Yeah, right. Yeah, 100%. I was watching some video of someone, who was it? Someone on, it was the Vecraam Swami on mad money, on mad money with Jim Kramer. And he's breaking down this biotech deal.

and every sentence he starts with actually. He includes the word actually like 25 times in this interview. And so Kramer will be like, oh, like, why are you taking this drug through phase three trials? Like it already failed phase two. And he's like, well, actually when we looked at the data, like it actually outperformed. And so he's like really enforcing that this is like true. What he's saying is a fact. It's actually true.

And he's just throwing that in. And I just picked up on it as like a rhetorical technique. got to watch out for these things, folks. It's important. We would never do something like this to you. We would never use rhetoric against you. Never. To get you to buy one of our...

Just sign up for RAM. To sign up for RAM. Actually. Actually. Which is actually the greatest financial institution of all time. All time. Also, the fleet physics that we are managing. And also, remember, you don't want to buy too much of anything at one time because Moore's

law every year is going to give you 2x. Your optimization is going to give you 10x. You want to continuously. upgrade the fleet, modernize the fleet, age of the fleet. And at the end of the day, you have the right ratio of monetization and demand-driven monetization to what you think of as the right training expense. I like the use of fleet because it does, you can imagine that same language being used at Amazon where they're like, all right, Jeff, you have tens of thousands of these delivery vehicles. Like the depreciation is insane. You're putting hundreds of thousands of miles

on them every few years. Like they're clearly depreciating massively. And So by positioning it as a fleet standpoint, it makes it slightly less painful that a lot of these GPUs will be worthless in three years. Yeah. Not worthless. People are like, yeah, I got a fleet of sports cars at home. I'm used to this. I've dealt with depreciation before.

You buy the right cars? I got an SF 90. You get some appreciation. Yeah. I'm down. I got a bunch of tycons. Yeah. In my fleet.

I'm sitting on losses. Yeah. The only thing that depreciates faster than GPUs is tycons. Tycons. Some people call them the GPUs of the car. car market. Yep. And so Ben summarizes this by saying this is the exact opposite way in which Microsoft was talking about their data center investments in October 2023, where Nadella emphasized that Microsoft would have a durable cost advantage because they could build infrastructure for

a specific model. So they were not talking about fleet fungibility at that point. They were talking about going all in on Open AI. Ben doesn't forget. He's putting Satcha in the truth zone. In the truth zone. And you know Sotcha's reading this being like, uh, you got me. Yeah, yeah. I was trying to be a little sneaky, like a dead and sneak past your techery. Oh, no. Uh, ultimately, though, that's not a criticism. Models seem to be well on their way to commoditization and Microsoft has changed its tune appropriately. And so, yeah, and they're hosting R1 for free. And so, uh, you know, credit where credits do. Microsoft is hosting R1. Everyone's hosting R1. No one is as much of a jingoist as you. no one no one is that america first like the whole like the abstract concept of like it's bad

to host the open source model just like that didn't take hold at all as a mean yeah just i you know imagine imagine sam you're you're posting this smiling picture with satia meanwhile he's but they host everything they host llama no i understand i understand yeah it's just and if you're an azure customer you're like i want all of them like give me all the flexibility all the time on cost oh oh they're hosting it on azure on azure on azure I thought it was an integration in teams or like the copilot products. Like if I go to Azure, I can get my SQL. I can get Postgres.

I can get other databases. I thought they were like, yeah, loaded into co-pilot. Sorry, Sam. Sam's got the smiling face on. He's just crying. No, no, no, no. It's not that aggressive yet. But, um, uh, and one more point of note, uh, hood the CFO said.

We talked a little bit about what the main drivers, uh, what, which was one of the Azure commitments that Open AI has made. And I do want to say that obviously this is a big commitment. You'll continue to see Open AI make commitment. So I want to separate the concept that this is one time versus an ongoing relationship that will grow as they grow, which it absolutely will. And Ben says that right of first refusal to Open AIs AI's AI buildout figures to be a pretty handy tool for Microsoft.

They can build capacity for their customers. And if they overbuild, well, guess they'll grab a. bit more of open AI capacity to fill in the gaps. And so Sotcha, you know, getting a little, a little, a tricky with the words, but an absolute dog. He's, he's nice with it. He's nice with it. He's nice with it. You know, he was the first hyperscalor big tech CEO to mention the metaverse before Zuck. He was like, yeah, we're really into this metaverse concept. Like, it's going to be a big deal. It's called team. It's called teams. Yeah, it was like you're going to be, if you're like an industrial company, you'll be able to create a, what do they call it, like a clone of your industrial

systems. So you'll be able to like walk around in virtual reality and see, okay, this machine is green, this machine's red, let's diagnose it. And called digital twin. We're running out of Lucy. Digital twin. Yeah, yeah. Let's fire up the packaging machine. Print more labels. Yeah. All digital. And I think they have some products for it. I don't think the adoption's been great, but it is just funny that he was early to the trend. He was reading that ball. Yeah. Another absolute dog. Okay, let's move on. What is Matt Ball up to these days?

Oh, he just put out a fantastic report on the state of video games, which we should dig into. We should dig into it. It's like a massive slide deck and he just did an interview with none other than Ben Thompson. The absolute man. Absolute dog on dog action. It's a dog fight. It's a dog fight. Those two guys get in the rain.

Yeah, yeah. Hot takes flying. Yep. It's great. Okay, let's move on to Masa Yoshisone. Hey, crack. I specifically ordered these this morning. This is my favorite little Japanese soda.

It's called the Kimono. Sparkling Yuzu soda. It's made in Japan. It actually still has all of the... It has some westernized labeling in order to sell here, but they left the Japanese characters on the side too. So if you can read Japanese, you can dive in there. But these things are delightful.

I thought it was a great way to kind of kind of kind of kick off this overview of Masa Sons, Masayoshi Sons, absolutely incredible career that we are blessed is still raging and roaring on the ultimate size lord. The gambling man. The gambling man. There's there's there's so there's John had covered Masa on on his YouTube channel in the past but in diving into this. So we we looked at some of his research from that and then I went back and started listening to the audio book, Gambling Man, which is an incredible overview of Mossa's life

and gets you really into, really into who this guy is, everything like deep family history, going back to his dad, his dad's family, his grandpa, their entire trajectory going from Korea to Japan, back to Korea, back to Japan, you know,

going through a very tumultual, series of decades leading up to Masa being born. Well, let's start with some context of why he's in the news and then we'll kick it off with the proper intro. So Jeff Lewis has a great post here that we'll put up on the screen. He says, you only have to be really right once. Masa has been really right twice. Third time tends to be a charm. And so Jeff's going long, Masa.

and Hero Onoda Capital says 25 at 340 post. This is the rumored Open AI round. And it's a quote. He says, there are one business guys. Bill Gates just started Microsoft and Mark Zuckerberg just started Facebook. I am involved in a hundred businesses and I control the entire tech ecosystem. Masa continued,

these are not my peers. The right comparison for me is Napoleon or Gangus Khan or Emperor Chin, builder of the Great Wall of China. I am not a CEO. I am building an empire. And that's the type of energy we love to see on the timeline. And so we got some photos of Masa, but let's kick it off with why you should care about this guy.

He's back. He's in on Stargate. He's ripping huge checks. He lost a ton of money. It was embarrassed by WeWork, but he made a ton back on arm. He's rich. He's powerful. And he's firmly back in the game.

And so why don't you kick it off with his humble beginnings and early life? Humble beginning is an early life. So he was born on the 11th of August in 1957 in Tosu, which is the southeastern part of Japan's Kyosu Island. He is a third generation Korean. Zainichi Korean, which are ethnic Koreans that were at some point or another granted permanent residency or citizenship in Japan. So before going into that, he actually, so going back to his, his, grandpa. I'll pull up some notes here. His, his grandpa and his, I guess, his great grandpa were a part of this sort of agricultural class in Korea. And so they were not seen as businessmen, but they were

seen as people that sort of, they were sort of aristocratic, aristocratic, their responsibility was sort of overseeing agriculture in Korea. And what's interesting about this is that his grandpa really internalized this. And so even though that aristocratic sort of agricultural class was disbanded in Korea and they eventually moved to Japan, he always saw himself as above business, like had a very negative view of business. He had a negative view of entrepreneurs, which is fascinating because Masa's dad, his grandpa's son, the grandpa's son, was very much an entrepreneur and he went on to very much influence Masa in a big way. And sort of capital, you know, in a big way. It's a real, you can just do things.

You can just do things, guys. So, yeah, so going, going back, going back, going back, uh, Mossa's dad was born in 1936. Uh, their, their, um, Masa, uh, he was just 21 when he had Mossa. Yeah, has a kid very young. Masas one of seven. So his, his, his, yeah, very, very much. Um, and so, uh, Mossa's dad is living through, uh, World War.

you know, the sort of the end of World War II, right? Sort of this Japanese reconstruction era. The Japanese were deeply embarrassed by World War II, right? They went from this sort of dominant empire that stretched all over Asia to being forced back onto the four islands. And they went through this reconstruction period. And so as the Japanese were in a bad spot, they badly, badly mistreated Koreans.

Even during the war, the Koreans were, the men were forced to work in like coal mines and do these sort of tasks that that were basically slave labor and the women were like concubine sort of sexual slave. So very, very dark history. And so this is this is what Masa's grandpa is like going through as like an adult basically. So he has a son. He has seven kids. And Moss's dad even has memories of American B-29 bombers. flying and bombing the nearby city that they were in. And Moss's dad has this memory of walking up and touching the glass of a B-29 bomber that crashed. But Moss's dad at the time is a kid, he decided that America was awesome. He says, like there's a quote. He says, he's like, at that point, from that point on, I thought America rocked. That was like the summary, you know, not word for word.

That's hilarious. And so after the war, Koreans are being treated terribly. There was a lot of pushback. Many of them were asked to leave. If you didn't leave, you were forced into these sort of shanty, you know, ghettos. Japan's always been kind of a late ethno state. Like they've never been big on immigration. Yeah, they're kind of changing their too now.

You can go live there, but you're very, very difficult to get citizenship. The population is collapsing, so things might change. But it's been rough, even being Koreans. not even being like an American who would really stick out. Yeah. And so they lived in this illegally built shack on the railroad. Yeah. So,

and so at one point they go, so Mas's dad goes back to Korea. They realize it's even worse there. There's like there's no economy. Then they decide they're going to come back to Japan. They get on a boat. It's like a multi-day crossing typically. It's like a couple days.

The boat sinks. and they spend two days at sea just like drifting around and eventually get picked up, taken back to Korea, and then they finally make it back to Japan. Wow. And so jumping forward a little bit, Japan at this point is still like a completely shattered economy, right? They're rebuilding. They've lost so much ground. Moss's dad leaves school at 14 and is selling alcohol to basically support his family. He's one of seven. He's trying to put some food on the table.

He's an illegal sake business. So Masa, yeah, Masa's dad starts a moonshine business. And at this point, his dad is a drunk, is beating him, like, frequently, very dark. Yep. And it has, at one point, badly beats him because he was bragging, Moss's dad was bragging to his friends about his business success, right? He's like, I'm making moonshine and making some bucks. His dad overhears it, ends up beating him for it.

So Masa's born 10 years after the family gets back to Japan. They're completely at the bottom of society. So it's very much like Masa, by the time he's a teenager, his dad is kind of on top, not on top of the world, but they have a very flashy lifestyle. But he's born while his dad is living with their family in the slums and they are pig farmers. And they chose pigs for a few specific reasons that I thought were interesting. So they, one, his dad had free labor because they. because they have a big family and everybody's participating. They have free land because they're just living in this sort of like railroad ghetto.

And the pigs just kind of roam around chilling. The Masa's grandma, who is a big part of raising him because his mom was very absent, takes Mossa around in a wheelbarrow, picking up scraps of food to feed the pigs. So this is just like, it's hard to even illustrate how rough of a situation they're in. But anyways, his dad picks pigs because they reproduce super quickly. Yeah. The pigs are just, you know. It's like very hustle mindset, but very limited opportunities and like low class.

Yeah. And so eventually through this sort of raising pigs, selling them off to be, you know, butchered for food, Masa's dad starts saving up some money. At one point, he has the equivalent of 100,000 USD, a lot of money back then. And Masa, this really gets into kind of understanding who he is. his dad starts to get into this thing called Pachinko, which is this new form of gambling, which is effectively via slot machines.

So this still is very much around in Japan. So his dad just starts getting into the game a little bit. He's gone from pig farming to gambling. Yep. An absolute dog. But he's on the casino side. But he's on the casino side. He's on the house.

He's not gambling and money away. This is important. But he still has to take some pretty big gambles. So anyway, so these are picture like casinos and is not that dissimilar. to what Vegas looks like today, where it's just rows and rows of these machines and people just sit there. And over time, he's sort of levering up. He's launching different, you know, parlors here and there. At one point, he takes a huge bet and spends $4 million on a new club, they called it. And it's called Lions. And so this was like the vast majority of the capital that he had available.

So a huge bet. And for the bet to pay off, he needed to get five to 10,000 people. per day gaming in this in this facility which is an order of magnitude more than his like best performing club so it's it's literally the most like gigacad long move that a lot of people are like you were absolutely crazy and his dad is on record saying I don't care if I go bust and he even had contingency plans he's like if I go he's like if I go bankrupt like we'll hit we'll go on the run he's like I'll run it all back wow and so this is this is the environment that moss is growing up in as like sub 10 years old, which is just crazy, crazy environment. And so he launches this club.

First two weeks absolutely flop. And he's like, obviously freaking out, but wants to, you know, wants to really make a play. So he takes like a $350,000 loss in the first month. He's like, I got to turn this around. He decides to, he works with his engineers to make it so that the machines like pay out a lot more. And people start winning a lot. And he starts attracting this flood of people. people. And so the next month, he changes it and he makes 350k of profit. And then he the next month,

you know, they're, they're kind of messing with the machines. He loses it back again. So he's no, these, the sons are just like not afraid to like make it all, lose it all, make it all. And, uh, and eventually he sort of slowly dials it dials it in. Um, and so by the time, Masas, uh, I believe it's 14. The family's now living this sort of dual lifestyle where some, They have 20 members of the family that are working on the family business, but then there's also the sort of older generation. And so it's this weird dichotomy where the people that are working in the business are like driving like flashy cars and like really like living it up. Right. They have all these sort of casinos. And then the grandparents are like kind of still around, but like very much still living in the past in some way. And so we can get more into Mossa's, you know, life and career. But I think that's very very, very.

important context because this sort of gambler's mindset and an entrepreneur like high high risk entrepreneurship is 100% in his DNA it's all he knows yeah so when people are for like oh how could masa put 10 billion dollars into you know we work and lose it all it's like well he's lost more money than any other man in history in the entire history of the world and in our sort of modern economy he's He's lost more. 70 billion during the dot-com crash. Yeah. The highest number ever lost.

Yeah. He was also the rich. So he went from being the richest man in the world to losing like 90. Yeah. And crazy. So yeah. And so I think through the gambling business and through kind of their family growing, he meets this guy, Den Fujita, who is an entrepreneur who brought McDonald's to Japan.

And this guy is a psycho. He has this quote. He says, if the general. Japanese eat McDonald's for a thousand years, they'll grow taller, have white skin and blonde hair. It's like they'll basically turn into Donald Trump. I think it's so funny that the dude's just like, oh yeah, like this is like Trump code. This is Trump maxing, basically. Trump maxing.

And so Fujita acts as like a mentor to Masa and tells him go study English, learn about the computer industry. And you got to go to America. And so Masa has this outsider complex. He's like, you know, yes, I'm like the lowest rung of society. Yeah, my family's from this like destitute, you know, shack. And we're still looked down on as kind of like gamblers and like, you know, lower class. But I'm keeping the name.

I'm not changing my name. And I'm going to prove that I can do it. No, and the cool thing. So Mossa's dad had a, you know, I don't know the exact dynamic, but a very rough relationship with an abusive father who's an alcoholic. Moss's dad is awesome, though. And like from a young age is training Masa and saying, you are the best. You are number one.

Anything you want you can achieve. Like it's honestly like I went from being, I was, you know, listening to this being like very emotional because it was so dark. And then it flips. And Masa's dad is you can just do things. Yeah. Anything you can see in your mind you can achieve. And Masa really carries that into the rest of his career.

Oh yeah. Totally. So he goes to California at age 16, joins this college before entering high school. And he, and he advances from sophomore to junior to senior in two weeks. by just testing out of everything. And he spent two full years at the college, then transferred to UC Berkeley to study economics while also taking some computer science classes.

Some computer science classes. And he has this idea where he needs to generate business ideas. And so he generates one new business idea every single day. He would have loved my first million. Oh, yeah, my first million. Or just like your path of just like building a deck, spinning up an idea, tweeting something out, and then being like, actually this is the business.

Yeah, the idea sucks. Or, but he was just throwing stuff at the wall. I remember in my first startup, we were destitute and we had a wall of sticky notes. It's just like all the different business ideas. And some days we would just pull one out and be like, can we build an MVP for this? And like eventually it started working, which is great. So he sells a patent for a translation device to sharp electronics. So it seems like he does have some sort of technical background, even though later on he becomes deeply vibe-based investor. He's just not an engineer. And he never identified as an engineer. He is, he is,

the Japan, in the grand scheme, he's the Japanese Warren Buffett. So you should look at him as like a dealmaker. Somebody that's seeing opportunities, putting people, capital and ideas together. Yeah. And doing it on a, on a global scale. And so Sharp pays him $1.7 million for that patent, which is crazy, considering how young he is at the time. It's a huge windfallback for, this was before 1980. So this is in the 70s. He gets two million bucks, basically. And so he immediately invested all in importing space invaders arcade machines modifying the software and installing them on campus and that makes him another million dollars and then he founds a game software company and he sells that for two million dollars so he's a bunch of like back-to-back hits really really quickly yeah and and so

then he returns to japan uh in the early 80s and he starts doing extensive research so he's just kind of monk mode he's made his money in america enough to like you know buy some time and he's just spending 18 months doing extensive research. All of his relatives are like, this guy's doing nothing. But secretly, he was building a massive knowledge base. So he developed 20 metrics to measure potential business ideas. And the highest scoring idea for him was personal software distribution. And this goes into his deal-making philosophy. He's not building the software. That's complicated. That's risky. He's just taking software that already works and just buying it for cheap and selling it to somewhere else. Yeah. Distribution businesses have existed for years. They're great

businesses. You usually don't have to take on, you don't have to take on too much inventory risk. Totally. You get this sort of toll booth style. Yeah, not R&D heavy, very bootstrappable. I know some people that own food and Bev distribution companies and like they just print money and they don't, and they never raised any money. It's like this amazing family on business. And so this, and this also like just, it's super aligns with his skill set at this point. Like he understands what good software is obviously because he's built a game company, ran the space and thing. But if you think about, you know, you get a call from somebody who's like in their early 20s. They've already sold like three companies. Like they're they have money. They're really like

this crazy hustler with this interesting backstory. Like you're going to take that meeting even though they're young. And so that's the ultimate alpha is just he's like such a hustler has enough of a track record to get the meeting. And then it's like, oh yeah, you're providing me a service. Like I need software to distribute through my stores anyway. So why not I, why don't I go with you? Yeah. And that's why when, you know, because today the young younger generation of entrepreneurs really know Masa for going giga long on Wii work. Yep.

And and and but it's, but that's not the story. So 50 years earlier, he had his 20 metrics to measure business ideas. And so he takes massive risk. And oftentimes there is a sort of vibes based analysis, which, which some of his employees talk about, right? Um, but in general, he's one of the most well studied, well research, most experienced deal makers in history. Totally, totally. And so there's not like he does get some really lucky breaks, but it's not necessarily luck, right? Because he's taking so many crazy shots on goal. Yeah. And so he

chooses the name soft bank. Think about it as like a bank of software. It's not, it's not actually a financial institution, but it kind of turns into one or a huge fund. It's a certain point. And so he he hires two part-time people in a small office. He's not afraid to hustle. And then famously, he would get an Apple box because he's short and stand on them and declare in five years. We'll have $75 million in sales supplying a thousand outlets and will be number one in PC software distribution. And the two employees were like, this guy's crazy. We quit immediately. Imagine giving a speech to your only two employees. Imagine we're like, Ben, this is going to be the most profitable podcast. We're going to crush it. We're going to be number one this year. And Ben just is like, I'm good. I'm out. I'm out. On that note,

I'm out. Yeah. I mean, if he saw a stand on an out, Applebox. Maybe that would be the trigger for that. But hilarious. And so, but he doesn't mind. He grinds through it. And so he, he books a giant booth the size of Sony, Sony, Toshiba's at a Tokyo trade show. Even though he's like this small company, he's just sending it. So smart.

It's so smart. He's standing out. This is the friend.com Alvi thing. Like, he's doing the thing where everyone's like, no one would take that amount of risk. And then it gets him a bunch of attention. And so he invited vendors to exhibit for free. And so he's like, I got this booth. I'll let you do it for free.

I'm going to advertise you for free. And he's just creating, pulling forward value, basically. And so it feels like a flop. There's no immediate leads. But weeks later, Joshin Denki from Osaka, contacted him. And originally, this is hilarious because he made millions of dollars at this point. And they're like, hey, we're the software firm. Why don't you come and pitch us and we'll see if we can do a deal?

And he's like, I don't have enough money to afford a train ticket. Like, I literally can't go. Yeah, so I would love to know how he's, he probably did the most degenerate thing with all that cats. Probably going long like Russian corn futures. Just like uses it all. Yeah, I mean, he's just investing it. I think he literally spent a ton of it on that trade show booth and just spending it on like, you know, all these, all these crazy long shots. Oh yeah.

They don't pan out. In an era when, when Tokyo's biggest software trade show to actually get a booth the size of Sony or Toshiba, you might have had to spend. A million bucks or something. Yeah, a ton. And so the president of Jocin Denki calls him and says, we need a dedicated software supplier. We want you to be the one to do it. And he says, this is such an interesting time, right? Because this is at a time where companies were R&D product companies, but they wouldn't do their own distribution. So to sell, they would just find a distributor that would be the primary sales channel for them. I mean, this was up until the internet. Like, All the, not this, we're in 1981 or something and all the way up to 2000, you would have to go to,

what was it, Comp USA or Best Buy or fries electronics. And I remember buying video games on discs in like boxes and you'd take that home. So why GameStop was a great business. Yeah. It's because the manufacturers, yeah, or the game makers didn't actually have. And if you just think about it, like there's, I mean, there's obviously some sort of power law where Best Buy is probably the biggest one. GameStop's big like you mentioned. But there are hundreds or thousands of individual small software box retail stores. And then there's also thousands of game companies and software companies and somebody making spreadsheets. You forget that before Microsoft can like condensed all of office, like PowerPoint was its own company. I'm pretty sure Excel was its own company. And they like

put all these together. Yeah, almost all of that was through M&A. And and so at a certain point, if you're the guys who are like, we're making presentation software, we're going to call it PowerPoint or whatever, you're like, okay, we have some cracked engineers. We built it. It works. It's good. But like, now we got to sell it into a thousand different retail stores. Like we have to have a massive Salesforce. It makes perfect sense to disaggregate that and work with the distributor. And so that's what they do. But Masa gets this phone call and they're saying, we need a dedicated software supplier for Joschen Denki. And Masa says, I have no product, no money and little experience, but I have the greatest desire to succeed. And I will pour my entire spirit into PC.

Let's go. Let's go. Full second. So one thing you'll know about Masa that's important to know is from a very young age, he intensely practiced manifestation and visualization. So he would have loved L.A. in the 2000s because this guy, I'm sure he's a big feng shui, you know, enthusiast as well. But he would, in his view from early in his career, if he could visualize it, he could make it real. Yep. And so, that has kind of bit him a little bit throughout, you know, the last few years. Well, he'll just announce a huge deal before it's done. Yep. And in his mind, he's like, I can see it in my mind. It's done. We're going to do it, right? And that bit him a little bit with WeWork because I'm sure when he was investing it,

we work at a $44 billion valuation, he just imagined a world where WeWork had office buildings, hotels, apartments, you know, all these, you know, campuses, right? And so he's like, of course, he was not analyzing it based on their ebada. At the time, it was entirely based on what he visualized. And he believed in Adam Newman. In many ways, Adam Newman was an amazing CEO from a storytelling narrative brand building standpoint. Yeah. Yeah.

And so in his mind, WeWork was already a $100 billion company. So it seemed like he's buying it for cheap. Yeah. He's like, you're the idiots, right? Yeah. Because he could see it in his mind. Even WeWork, like it's not like we work. People like to put WeWork in the same bucket as like Theronautis, but it's just not true at all.

Like this is a benchmark company. Like, yeah. This was like, they were very much like a serious contender in Silicon Valley, whereas there and us was like this weird zombie. The thing, the other thing with rework is the fundamental consumer product was amazing. Yeah. Do you remember walking into early reworks? I remember being, you know, you know, in college probably going to my first rework. I'm like, the coffee's free and good.

Yeah. Like that's amazing. It was like a fun vibe. Everyone was friendly. Maybe it's not the highest productivity space in the world. It was on a mega trend of like. more remote work, more distributed teams, more small teams, more startups. It felt like the pricing part of why the product was so good is because they were not selling it for what it costs to deliver.

Totally. But it still was like, okay, at 400 bucks a month, it'd be stupid not to get this because I'm getting so much value. Totally, totally. And so Masa, the dealmaker comes out in full force with a joshing Denki deal. He says, first off, you got to break off other vendor relationships. You got to go exclusive if you want to be with me, but I will work extra hard for you. And then he also really pitches them on this idea that the software is key to them winning in hardware. So the idea is like if Joshen Denki wants to sell a lot of hardware, they're going to need the best software in their stores.

And people will come for the software and then they'll buy a new computer. And that and that virtuous cycle will drive value for Josh and Denk. He's not, he's not wrong there. Like that is a good pitch. And so he secures the deal. And he also importantly gets Josh and Denki to pay for product inventory covering Moss's shortfall. So all of a sudden he doesn't have a working capital problem. And so even though he's very small and doesn't have a lot of a lot of funding raised or anything, he can basically boot up.

Joshin deserves, hopefully Masa went back after all of this and was just like, got some warrants. Here's a boat. There's a boat or something. You know, something to pay him back because it seems like Jocan just made it a really risky bet. I mean, look at this growth. He was always a force. Always a force. And so Masa takes softbank from $10,000 in monthly revenue to,

2.3 million in monthly revenue. And remember, there's no inventory cost here. So it's all, like, it's all like, effectively software margins. Like he doesn't have the working capital, like the debt issue that he's printing. He's printing. And so he IPOs in 1994 at a valuation of $3 billion. And by the early 1990s, SoftBanks was, SoftBank was Japan's large distributor of PC software. He manifested this. And he was extremely wealthy, but far from done. Should we move on to the dot-com boom and bust? This is like, we're just, We're just getting started. We're just getting started. Buckle in folks. We got another hour, at least on this baby. So he moves to Silicon Valley in 1995. He sets up offices in Mountain View, seeing the internet's enormous potential. And 1995, this is still early on the dot-com boom. It's not like he yoloed in at the top in 2000. He did. He did that also. But he also got in early, and that was very, that was very valuable. And so the dot-com boom was in full swing. Companies were rushing to harness the web's explosive growth. But this was still pre- IPO, craze, oh, raise, you know, go public with just a slide deck and a domain name.

And so in 1996, he meets the Yahoo co-founders, Jerry Yang and David Filo. He offers them $100 million for 30% of Yahoo. It's a big stake. Typical VC funds at the time rarely wrote $100 million checks because that could alone be 40% of a fund. Yeah, this is so normalized now, but the biggest funds back in the day were like a $100 million. Like a classic solo gp fund today. Yeah, yeah, yeah, exactly.

Yeah. And it just, yeah, just like you would just raise from VCs for a seed round or a series A, series B, and then IPO. Google IPO very early. Obviously it was a different thing because they were cashable positive. But even, even the money losers would IPO and use the capital markets in the public capital markets to raise money. Exactly. Nowadays when companies IPO, they're oftentimes, it's not even about the money. It's about the liquidity for the shareholders. It's like, well, I raised a couple million dollars just from angels. Then there were a bunch of, there were a bunch of huge venture capital. firms that could rate a $20 million series A check, no problem. Then there were growth funds. Then there were crossover hedge funds. Then I started just going to the direct LPs and being like, can I raise a couple billion from a sovereign wealth fund just directly in the private market,

all before IPO. And that's why you see companies IPOing at 60 or 100 billion. So listen to this quote. Masa gave the, after he made this offer, he gave the Yahoo founders an ultimatum. He says, if you don't take my money, I'll invest in excite or Likos, which were competitors, and kill you. He's just making death threats. The funniest thing about this quote is that he didn't even know who their competitors were. In the meeting, he asks, who do you think your biggest competitors are? And they say, probably excite or likeos, he's like, okay, well then if you don't take the money, I'm investing in them. Thanks for doing my DD for me.

Ultimate dealmaker. Didn't do any research. Still wins the deal. And so it's this interesting because he breaks all the, all the trends of, he's exactly the opposite of Warren. Buffett. Totally, totally. Right. Warren Buffett is heavily research, sort of slow, moving, builds these positions,

you know, over time, makes a position, then starts marketing and things like that. He's the opposite where he's coming in. And he's clearly brilliant and gifted and a brilliant entrepreneur. But from an investment standpoint, he breaks all the rules, right? He's not even doing market research before offering to do a $100 million investment. Crazy. To not know the competitors. Yeah.

And just be like, yeah, like you guys, but also I will kill you if you don't let me invest. And so Yahoo accepts the $100 million offer. They IPO in 1996, like very shortly after this deal goes through. And the share price soared on day one, Masa made $150 million immediately. Which again, at this point in time, doesn't really make a dent in his net worth, right? Like he had taken soft bank public at a $3 billion market cap. Sure, 150 extra bones is not. not a bad thing. Yahoo continued to rip post-IPO all the way.

I know. I know. I'm just saying, I think you'll realize through looking at Mosses, the reason that later in his life he starts to make these crazy size lord gigacad, omega-long bets is because he's had instances like later when he invests in Alibaba and prints tens and tens of billions of dollars, you know that he wished he just massively sized up that position. Totally. Totally. And to that that leads to the sort of 10, you know, he's looking, you know, right now. There's too many VCs who are like, yeah, I'm in this amazing company. I got a quarter percent, you know, because I got, I got diluted down. Just the logo at that point. And I got crammed down on this one round. I couldn't get to the ownership

percentage. And the founders only wanted to do a 10% round. And I only took 2% of it, all this stuff. But I mean, Yahoo, like the wealth creation at Yahoo was really underrated in the Silicon Valley story. Like when I got to Silicon Valley, you'd meet a lot of Gen Xers. And a lot of them were like, oh yeah, I was early at Yahoo. And then you're like, okay, this person's like cool and like kind of smart, but not like generational talent. You go to their house like a $40 million mansion in like Melville Park because there was just so much wealth created from that IPO and a lot of liquidity.

And so it was a huge, huge thing that led to, you know, a rarefied error around anyone associated with Yahoo. And then also just like kind of a Yahoo Mafia that spawned and built a bunch of companies. And it was kind of like the Facebook of the day, but it didn't have staying power whatsoever. And so eventually unwound. But so once he gets liquidity from that, he's hooked on dealmaking. And so from 1996 to 2000, he invests in 250 internet startups, generational run.

Deal a week. And he emphasized. And you know there were some weeks. You know, some weeks he probably did five. Oh, yeah. And other weeks he was back in his Tokyo pad. He's making calls. Okay.

Yeah, what is it? Oh, who are your competitors? Okay, I'll invest in them. Okay. Yeah, one thing that's interesting, a lot of his career, you know, he, He had his time in the valley, but a lot of his career he spent working and living in in Tokyo. Yep. And just sporadically traveling to places like Davos, you know, or California, things like that.

And so he's basically just making a, he's not trying to pick winners. He's just trying to ride the internet wave. So he's not, not doing a lot of due diligence, enormous volume. And it's a good bet at the time. He created the Tiger Global Playbook. Tiger was the same thing. Tiger just timed it terribly. But Mossa originally. Tiger actually did way more due diligence because they would hire like Bain, consulting.

It was still pretty quick. Still like they were doing market research. Totally. Tossa is just vibes based. Ripping. Ripping checks. And I mean, we should do the Tiger story at some point, but they were very active in Asia around this time shortly after this. And so made a look, made a ton of money there.

Masa is not just scaling the investments. He's scaling the firm. So he launches basically teams in South Korea, Japan, Hong Kong, Australia, India. Mexico, Brazil, Argentina. So all, you know, over the last, you know, decade you've had VCs being like, oh, yeah, we're doing a lot in Latam. Yep.

We're doing, you know, we're doing stuff in India. We've got bets in Pakistan. And, and, uh, meanwhile, Moss has already been in all those places just spamming checks. Spamming checks. It's great. It's like you on the, you know, with the, you know, the del machine, yeah, you know.

Spam them. And so he makes $15 billion in just a few years. And he starts to double down once he meets. Jack Ma of Alibaba. And so Alibaba's scaling. They need additional capital. Goldman Sachs, who was old Alibaba's previous investor, was reluctant to keep funding it. Didn't really see the massive potential there and was looking at more on a spreadsheet basis.

And so Masa meets Chinese first mistake. Yeah. Ignore spreadsheets. For sure. And so he meets Chinese tech entrepreneurs and he sees a glint in Ma's eyes. And one one thing about Masa is like you need to understand this run as he is a de josephi. Gendrant gambler because like he grew up in casino like you know these Pachinko clubs and he had so many wins and his dad was fully comfortable with making you know going up one month and losing it all the

next month just keeping it rolling yeah beta beta yeah beta and so they shake on a deal 20 million on a $100 million valuation but he winds up getting 34% of Alibaba through as the deal progresses and so the critically advantage here is that Masa sat on Cisco's board and saw router sales to China exploding indicating massive internet expansion. So he got some insider Intel understood the market was growing and went in, found a targeted bet and ripped a check. What's probably missing from the story is that he probably wrote a hundred other 20 million dollars checks and none of them went went anywhere but it doesn't matter because he got he got the elephant he bagged the elephant and so the dot-com crash was rough for it.

Wait let's talk about the alibaba investment real quickly so he turned 20 million dollars into a $72 billion position, which I think is actually the greatest. I think it might be. The greatest venture bet of all time. It's hard to measure because I think it's sold off a ton during the dot-com crash, but at the current valuation, and I think he still owns a huge chunk of Alibaba, right? Because that was one of the positions that they were thinking about unwinding

to do the Stargate deal. Yeah. So interest rates rise. in 2000, the stock market plummets and many.coms with shaky business models went bankrupt. SoftBanks market cap plunged 99%. Yeah. So to be clear, so this was in March of 2000. In January, he was giving a talk in Tokyo at this like very kind of cool underground

sort of disco type club to all these. And the Japanese culture at the time was very much salary, men. And, you know, you worked a good income. And it was sort of seen as boring. And so Masa got all these guys in a room. And it's been described as being almost like a get rich quick scheme because he was pointing around the room being like, you're going to be worth $50 million. You're going to be worth $100 million.

You're going to be worth $100 million. And just like going around the room like that. And it really seemed like that. And he genuinely believed it. Totally. And I'm sure many of those people went on to start, you know, important companies. but he was, I do believe that at every market top, he still believes, which is why he gets smokes, right? He's not the guy. He doesn't really, I don't know. He never sells early. He never

sells early. Yep, which is a drawback for a lot of big investors who have the ability to find fantastic entrepreneurs, see trends, but then they get pessimistic at the last second and say, ah, this must be capping out. I've made so much money. I mean, the whole benchmark Uber story, people are like, you know, maybe that was like they were like looking at, well, you know, we're each going to take home a billion dollars individually. Like this is retirement money. Maybe we got to get out something like that. And there's a little bit of internal, you know, devil on the shoulder telling you,

hey, this is this is too good to pass up. But even though he's losing so much money, he personally lost $70 billion, which is a record at the time. Alibaba is surviving. Did we hit the size going to? I think we take a moment of silence. Moment of silence, but it's almost like. Losing $70 billion means you made that much, which should be sold.

Gone, but not forgotten. Let's hit the size gone just a little like it. Boom. There we go. For the run up and the rundown. And so he makes it through with the Alibaba stake and then he starts launching more companies. Yahoo broadband, Japan Telecom, Vodafone, Japan, rebranded a soft bank mobile.

And this was smart because he found the area of tech that had durable revenues. Totally. People would pay for an internet connection. they would pay for cell service, you know, things like... And disaggregated from the application layer. Yeah. So it doesn't matter if Yahoo wins or Google wins or Excite wins. If you own the broadband, broadband demand is going to increase...

And today, he still has a huge position in T-Mobile. Yeah, that's right. There's certain positions that he just, you know, kept riding. But so the chaos of the post-2000, you know, the actual, like, dot-com crash was because there were all these businesses that Masa was. was hugely invested in that were like dogs.com. Yeah. It would be like basically a service where you could buy dogs online.

And it turned out that people were still just buying dogs from like, you know, regular kennels and stuff like that. And so you can think about the early 2000s is kind of like back to the basics, rebuilding with like less frothy companies, riding the Alibaba stock, rebuilding a soft bank backup. And then in 2010, he releases this 30 year vision presentation. and this thing is a bomb shell. In June of 2010, it's 133 slide deck with outsized predictions like advancements in artificial intelligence will surpass the human brain. Life expectancy in Japan will reach 200 years

and a new era of hyper-connected communication will be upon us. And so his central philosophy is the information revolution will bring happiness for everyone. So I love that even today he does... Similar things. Well, he's a master marketer and salesman, right? He's a deal maker, so he's got to sell these deals. And he would even, despite his limited English, he would know the simple words to say,

information revolution to bring happiness for everyone, right? It's very sort of simple. It's very intelligible. It's not techie mumbo-jumbo about scaling curves and H-100s and all this other stuff. Yeah, and even his more recent decks have these very simple. simplified. Yep, graphics. They're so simple. People make fun of them. People make fun of them, but then they end up being correct. Yep, they do. In many ways. And so the Vision Fund is born in 2017. He conceptualizes it in 2016 during a flight to the Middle East. He wrote down a target of

$30 billion, then crossed it out in favor of a hundred billion. What do you say? He said, life's too short to think small. Yeah. And so just tripling the size of your raise. Just yeah, Let's go big. One of the greatest, probably the greatest fundraiser of all time. Sam Altman's very good at fundraising, yet he still has to go to Masa to really get the job done. Elon's great too, but it's a very different style of pitch, more driven by the science and the technology. So he has this famous 45-minute pitch where he's meeting with the crown prince of Saudi Arabia, Mohammed bin Salman.

In Mossa's words, he says, I want to give you a trillion dollar. gift. If you invest $100 billion, I'll turn it into $1 trillion. So MBS, ultimately invested $45 billion on the spot, catapulting the Vision Fund into existence. They also add a bunch of other investors, apples in the Vision Fund, Qualcomm, OXCON, UAE's Mubodala, you know, sort of sovereign wealth fund. SoftBank puts in $28 billion. Yeah. The funny thing about this is that he goes to MBS and is like, you got to invest $100 billion to, I'll turn it into a trillion. And MBS is like, that's crazy, but I'm still going to give you 45. Yeah.

It's like a total shoot for my 45. I'm good for my 45. And it's funny because his original target was 30. He sized it up and still exceeded that with the first check. Yeah. And there's been this idea in tech that Middle Eastern money is easy to get. Yeah. And that perception is only because there's a lot of capital out there.

These relationships take a lot of time. Yeah. I know a ton of allocators. that have had to go visit the Middle East 10 plus times before getting anything done. And so it's not like this was easy. You know, Masa made it look easy because he just rolled over there. He was thinking about doing 30, crossed it out. You like the 100 to a trillion.

But this was, again, a very credible feat by itself. And then SoftBank commits $28 billion of the fund. What Masa has done historically, I don't know exactly. but he also makes venture investments using leverage, which is kind of a tricky situation to get in because one, venture investments can go down all the way to zero, right? And yet he still owes that money to someone. And so he would use, he would use soft banks, you know,

actual earnings to help back that up. And then also would lever up other positions. So he would raise debt against, you know, some of his specific positions. And so all throughout this, even from, you know, from the early 1990s to now, he's gone almost bust in like smaller ways that don't even make it into the story because he's just levering up, just going long. Like, he doesn't, you know, I don't think this man has ever been short, you know. He doesn't have any middle of the road outcomes.

Yeah. It's all 10 baggers or zeros. Yeah. Which is great. Well, in the case of Alibaba, you know, a 10,000 bagger. Yeah. So he focuses on AI, robotics, IoT, and consumer tech. He makes bets on Uber.

we work, bite dance, DD, DoorD, DoorD, grab, and then quirky are startups like Zoom for Robot Pizza and Wag for dog walking. And it's funny because three of those are companies that have been like, oh, this is such a silly idea, never was going to work. He was so stupid for doing it. And then Uber, bite dance, DD, DoorDash, Grab, all banger companies. Yeah. All very, very good. Yeah, and one thing you'll notice here, he does not, he has no issues investing cross-border. So he has big presence in the U.S.

he has a big presence in China. And so he's one of the few that's actually threading. I mean, of course, some American venture capital firms have gone and raised Chinese money or invest in China. But he's getting into the best Chinese companies, you know, bite dance, D.D. the Uber of China. And so really, he's a truly global dealmaker. He can go into any room and make stuff happen. And he's really good at being the capital that bridges.

these huge deals, like I'm pretty sure the Uber and Dede deal, like having soft bank bridge those two companies and put money into both in like this interesting way is like what kind of facilitated that. And that's just like a wild card. It's kind of the same thing that's happening with Stargate where he comes in and all of a sudden like Larry Ellison is with Sam Altman and it's like more of this like Avengers style team coming together because there's so much capital on the table. Everyone's like, okay, yeah, I'm marching to the same beat of this drum. And he's oftentimes has the conviction to make stuff happen that otherwise would have never been a part of history. Totally.

Yeah. I recently invested in a founder who will go unnamed that took a couple hundred million dollars from Vision Fund during 2021. And the pressure that he faced immediately after investment to deploy it. Because in hindsight, he's like, how did I spend that much money? in such a short period of time. Company ended up, you know, selling it wasn't a good outcome. But he just said the relentless pressure of like, we gave you this money. Yeah.

100x your business this year. There's also this interesting dynamic with SoftBank. I've heard from some folks that have had SoftBank on their board that even though Masa might come in, there's this example with WeWork, he gave Adam Newman, the founder of WeWork, the founder of WeWork, $3 billion on the first meeting and told them to be crazier. So the CEO and Masa, they, they, they, they, get together, they have a short meeting and it's like the deal's done, but then softbank actually comes in and puts in like crazy infrastructure in the board. And so if you sit on a board with a soft bank

board member, there will be audit committees, compensation committees, like they run it like a public company basically. And so a lot of investors like hate that because they're like, I'm used to having like a one hour strategy meeting with my boys. And now I'm like doing like paperwork, which I'm not down with. I just want to let the CEO cook and just do it. Yeah. But it's interesting. And in many ways, early on, I think investors would say this is amazing vision fund, you know, very early, just gave a company that I invested in at an $8 million valuation. They just gave them $100 million. Yeah, right.

It's a crazy valuation. The markup's great. Companies super capitalized, but then over time, it ends up being seen as more of a kiss of death because a lot of these companies, unless you were this generational outcome like Uber or DoorDash or RiteDance. And you're really ready to deploy that money. Yeah. And you're legitimately a phenomenal. business that's that's already has some maturity versus something like you know

Zoom like the robot pizza company where there's tons of competition there's clearly no real network effects called the suicide round I like that I like that terminology is great and there's been a few of them they lost money on we work obviously which we've talked about they lost money on wire card the German payments processor which collapsed after accounting fraud green sill capital melted down and many vision funds start up green profit ability was green cell was it Was it a fun they invested in? Greenill, I don't remember.

I thought it was like housing or energy or something like that. And it was a big blow up. And so there's been a lot of those, but he's still in the game. Yeah, and it's tough. Like the reason, you know, the reason why these rounds ended up being the kiss of death is if you're not profitable, then you raise $300 million and you spend it all. Yeah. Then you're sitting on this massive preference stack.

Nobody else wants to back the company because it's going to be tough to get any money out unless like everything goes perfectly. And the number is so big, you think like, oh, wow, he gave Adam Newman $3 billion. And like it basically went to zero. Like that's so embarrassing. And then you realize that in 2021, SoftBank posted an annual net profit of $46 billion. Yeah. It's like enough to cover what, 10 of those investments, 15 of those investments without blinking.

And so you look at the GP commit on the vision fund. They put in, what, 26 or something? 28 billion on 100. Yeah. They can do that all day. They could do that all day. And it's just like he's just the numbers are so big. You can't get you can't analyze them like it's a traditional fund because it's backed by this organization that's just printing cash, printing cash from all of their whole. Yeah, but now I think their actual net income is in the single digit billions. So that was a specific moment in time where they had a lot of things go right. Sure. Which was just due to COVID and interest rates and but he doesn't quit. You only need one. Yeah. You only need a couple of minutes. Make it all bad. to make it all back. Yeah, that's basically what he does every single time. And so in 2022, 2022, 23. And this history, going back again to his childhood, he was conscious when his dad was willing

to bankrupt the family to go when they were already super successful, right? So a lot of people look at this and it's like, Mase, you've made all these amazing investments. You've built one of the biggest companies in Japan. You've been the world's richest man. Why are you still taking on all this risk? Yep. And the answer is he's playing the greatest, biggest game that he can play, right? Yeah.

Which is. And so, I mean, you were right that a year later in 2022, they announced a $27 billion loss. And so they lose money on Klarna. There's a Chinese tech crackdown. And so Alibaba and Didi get hammered by PRC regulations. Very hard to make money as a private investor in China, especially if you're Japanese instead of Chinese. And then it emerges in 2022 to 2023 that he personally, owes softbank $5 billion due to side deals gone awry.

He's just rip in. So he's got his main deals. And he's just like, he's got his side deals. And I'm like, oh, yeah, I'm good for it. Like, I'll write. I'll put this on the ramp card. Yeah, yeah, yeah. Yeah, just, just hit up soft bank.

They'll take care of this billion dollar loss. Yeah. And so Masa says, yeah, and this is, this is evident of the way that he operates, which is he is such a force that he's traveling all over the world, doing deals, committing to things, announcing things. announcing things that haven't been actually finalized yet. And then telling his team, all right, just make it happen. So it's not, shouldn't be that surprising to anyone that after the chaos of 2020 to

2023, he just happened to like, owe his own company $5 billion because of like some other stuff that probably didn't even make it into the news. It's remarkable. And so he shook it off. He says, when it rains, you open an umbrella. and he's repeatedly insisted that he's embarrassed by the fund's performance, but remains an unshakable optimist. And we saw that comeback.

And we didn't even get to Arm. You know, he turned something like $20 billion and $80 billion gain. He's back in the game. And he is making AI deals now, ripping checks into OpenAI, working on Stargate. It's just... He's just not going anywhere. He's...

So he's the dealmaker tech mode. that has the he clearly has a very powerful very well known in our center you know corner of the internet yep but if you actually go ask people that maybe even are in tech but don't really follow the game closely they won't know him yep and the story is just truly incredible grows up in not just poor but like abject poverty living with pigs yeah like he has he he said he has a consistent night around waking up, you know, having these nightmares that he's smelling that the pig sort of fumes, right? And he wakes up like, you know, in, in shock, right? And so to go from that abject

poverty to the richest man in the world, made his, was born in poverty, made his first million in America before he turned 20. Yeah. Runs it down to zero again. Runs it back up, back down to 99% down, runs it back up. It's so funny. Man, uh, Doesn't quit. He can't be broke. No. He's like he should launch a course. Yeah.

You know, like at this point, like if you ever got down bad enough, he just could launch a course. Well, yeah, it's so funny because this week that Hacker News comment went viral that's like, entrepreneurship is like throwing darts at the dartboard at a carnival. If you're middle class, you get one throw. If the rich kids get unlimited throws and the poor kids are working the carnival. And this guy has gotten so many throws and he came from nothing. Just completely validation of that.

Yeah, he just figures it out. And it's funny because that always goes viral and people are like, oh, this is so true. Like this hits so hard. I looked up the dude who posted it. He's never launched a startup. He's never even tried. Yeah. And so it's clearly just cope just being like, you know, oh, yeah, like I can't do it

because like I'm too poor or something. And like clearly there's a million ways to start the flywheel. And then once you're on the flywheel, you get extra shots because it's like, oh, well, like your last company didn't do well. But yeah, you probably learned a lot. you were a CEO and entrepreneur for a while? When he was in that nightclub, talking to all the Japanese at that time, it was not normal. You know, venture capital didn't really exist in Japan in the same way it does in America.

And he gave the stories like in America, an entrepreneur can start four companies. They all fail. And on the fifth one, they become a billionaire. Yep. There's so many stories like that. And so the thing, the criticisms of the risky governments and the just crazy risk tolerance are real. We're not, you know, this shows obviously for entertainment purposes only. But the thing that I think everybody should take away from Mase is that extreme radical optimism.

Yep. And he's shown that. And the ability to be a dealmaker. Yeah. It's really just a story of dealmaking, in my opinion. Yeah. It's so underrated tech mogul without seemingly ever written writing a line of code. Maybe in the very early days.

Yeah. But he was. But very quickly moved to just how do I assemble capital effectively? Yeah. How do I put the puzzle pieces together? This is Sam Altman too. This is probably why they... Elon hired Gwen Chautwell to run SpaceX.

It's fantastic. It doesn't take away. It actually adds to their, like, their abilities. It's leverage. It's leverage for the team, for the mind. It's fantastic. Well, that wraps up our deep dive on Masayoshi Sone and SoftBank. Let's go to a promoted post from your buddy Steve.

Oh, also. Small note. Yeah. He's got two daughters. I don't know their relationship status, but brother. Why don't you if you send it send Masa DM on LinkedIn and say hello I you know if you review my profile and you find me compelling I would love an

warm intro to your daughter there you go he's still he's married to his wife that he actually met at Berkeley still wow that's a fantastic Masa always gets the last laugh he does he does let's go to promoted post from Steve I got a promoted post for my buddy Steve Simone so yesterday you sent me this which was a Chinese drone light show and can you actually play no you can't no we can't play the video we're working on we're working on tech here at technology brothers we want to get to the point where we can play videos but I will just share so Ben Benjamin Craker Cracker cracker who knows who knows the Cracker says how do you defend against this not a rhetorical question and it's a video of these dron crazy drone light shows Steve says you don't you have a robot do it for you

And so what ACS is developing, I'd love one of these to put on top of my G-Wagon. But he's developing this sort of autonomous counter-drone gun that can, I've seen, you know, a bunch of demos at this point, but it can take out drones from. Some people have just described it as ACS, gun on truck. Gun on truck. Yeah, yeah. They should really buy gun on truck.com. Gun on truck. Gun on truck. And that's the.

But anyways, go check out ad Steve Simone and check out their turret. It's pretty awesome. The bullfrog. Fantastic. We have another promoted post from Ryan McIntosh promoting our show and promoting an ad in Arena Magazine. This is also promoted post for Arena Magazine. And there's an ad for Ramp in the ad for Technology Brothers in the ad for Arena Magazine posted by Ryan McIntosh. There's levels to this. And so we whipped up an advertisement, full page, full bleed, beautiful, full color printed in the latest Arena Magazine. And why don't you read it the whole thing top to bottom? Sure.

So I said, technology needed a podcast. Last year we noticed a problem. While we were listening to the All In podcast on vinyl, we realized something shocking. It doesn't have ads. No ads for watches. No ads for private jets. Not even a plug for ramp.

It's hurting the tech community, but the madness ends today. What if instead of focusing on audience size, a podcast focused purely on profit? What if instead of big political questions, it answered the ones entrepreneurs really care about. Should I get a Ferrari F40 or a Lamborghini Murah? Should I upgrade from a Gulfstream to a BBJ? What's the best of Mon property? Technology Brothers is that podcast focused, profitable, capitalist. Visit techbrospod.com today and add it to your RSS feed.

Before we dive into the rest of the timeline, we got some questions. Let's read through some questions. Tyler, Ron Gioni, with a phenomenal suggestion. He says, get a medieval night. helmet for steel man arguments oh that's fantastic so much so much better than so much better than steel hat yeah than just a steel hat i mean we have our tinfoil hat but the this the the medieval night helmet is a good uh opposite yeah we need both of these clearly and uh anyways uh just j the letter j says which one is the technology brother's favorite yolo seed round or guac a round uh i i think that's mango seed round or the suicide a round suicide no it's More of suicide B.

Suicide B is typically what happens. Yeah, it takes $300 million. I just die. I love a yolo. I love a yolo. I actually like when the first round is just 20. Yeah. You know, kind of like that incorporation round,

20 on 100. Those ones always work out. Great. For sure. Next question. Venturi says, I think he's responding to Masa on this dealmaking. I don't know exactly.

He says sales is massively more valuable than engineering. So Venturi is clearly. the engineers listening, so feel free to duke it out in the comments. But in Moss's case, he probably had way more impact on the world by being a dealmaker. He might have been a top 10% engineer. He's a top 0.01%. Yeah, I think it's clear that he did the 80-20 on the computer science thing, took the classes, got really pilled on technology, and understood how exponential curves will affect the future

of the world and humanity. And he can still think like a technologist while not actually needing to. to lead a tech company, be a CTO, be a programmer, do any of that. But he understands the science at a deep enough level, which is important. Yeah, you're still not using that knowledge for diligence. Yeah, yeah. And I mean, we have friends that buy small companies where people say, oh, did you do like technical due diligence?

Look at all the code. And they're like, no, I looked at the Stripe account. Because if the customers are paying, that's evidence that the code is working. Yeah, or just use the product yourself. Exactly. Is it a good product? Is it a good product? I know this has been happening with.

with really smart sort of AIML trained engineers that are now building products at the app layer. Oftentimes they know so much about the actual technology, but can't translate it into products that people love. Oh, cool. Like your training in Prince Cost is so low, that's amazing. But like what's your product sense like? Are people actually using it? Did you get viral market entry?

Exactly. Exactly. Asar says, should companies stop paying dividends to reinvest their dollars into custom letterheads? Yes, obviously. You need to have custom letterheads. We're working on it here. We're actually, you know, behind. I got some custom letterhead for Christmas.

We need, like, our own actual stacks of paper, even though we're sort of evolving. I got the business cards. We need TB business cards. I got some personal stationary. I need some TB stationary for sure. Haneal Patel says, I'm planning to do my master's at Berkeley in civil engineering. Should I do it? Should I do it?

He's an international student. He says he wants to go become a founder or break into founders fund. both good options. Hopefully you get both. Well, you definitely have the first option. Founders Fund. It's tough to get in, but we have at least 50% of this podcast works for founders fund.

So if you're listening to it, that's a good start. You know, if you want to be a founder, doing a master's in civil engineering might be awesome. It could be a huge distraction. It could be a huge distraction. So if you want to, you know, go into that field, and I'm sure there's a bunch of really crazy, cool opportunities to apply, like, modern technology within that. So I don't think it's a bad idea, especially if you're not a U.S. citizen and you want to spend time in Berkeley.

I mean, so many, Berkeley's doing a bunch of cool stuff in AI. I don't know if it's in the timeline, but they, I mentioned it earlier. They were able to create a reasoning model for like $450.50. So just being in the Bay, I was born in Berkeley. It's a funny, funky town, but you're right there next to San Francisco. going to the bay. I guess the question is, will this pull forward finding a really,

really valuable idea? And sometimes being in a master's program can be a conduit to industry where you might identify a big problem and identify customers. Sometimes you can bootstrap that without that, you know, on the resume. You could just go work straight at a company

and realize, oh, this stuff's way broken. I've got to spin this out and build something. Yeah. So there's a bunch of... Yeah, you're probably going to have to go from your civil engineering masters to work at a company to truly just figure out.

So the question is, can you just go straight to the company and get those learnings? But starting companies is not a race. There's just so many examples at this point of people that started their first company at 40 years old. And they needed all that experience to get to the point where they had the knowledge. One, two more questions. Do the technology brothers have a favorite pen or pencil brand from a czar? Again, I actually don't.

My handwriting is terrible. Mont Blanc, we promoted on the show before. I'm using a Bowery hotel pen here. But also hire a calligrapher. Yeah, for me, it's just got to go hire. Full time. Sergio says, do you guys publish anything in the paper form or do you have a website? Yeah, we have Techbrosepod.com and a new website that is already in the works with a new domain that we're excited to share soon.

And then we don't do anything in paper yet. We're experimenting. Auction these off. They're valuable. Kids books. We've talked about. random tweets. We talked about making a book that's just why you shouldn't use leverage and then it's just a hundred empty pages. Love that. But yeah, we stick with Arena right now. That's our

magazine of choice and Colossus. Colosses. Yeah. Of course. So thank you guys for the questions. Fantastic. Well, let's go to Grant. He says substituting three hours of daily scrolling through X.com with three hours of playing factorial while listening to the Tech Bros pod gets me up to date on the news I care about, teapot bangers of the day while destroying bit biter nests and juicing mining productivity. I have a similar hack for work instead of writing code for eight hours like a pleb. I spend five minutes writing GitHub issues for mentat, alt tab, and spend 10 minutes expanding my green circuit board, then flip back to GitHub and review PRs. Mentat is the fastest most capable AI agent for coding that plugs directly into your GitHub workflow

log in at mentat.a.i for $30 worth of credits free and redirect your engineering talents toward expanding your base. Brilliant, brilliant post. Talks about the show. Yep. Talks about the content. Yep. puts an ad in it.

I love it. I love it. This is peak technology. One post, you're going to have a ton of different content in a post, including ads. Yeah. Love to see it.

Well, we got another promoted post by none other than Lulu Masservi. We got a fantastic opportunity. She says, Wanted, a founding engineer to join Rostra to work with me on a novel tool for founders. Like a Waymo, you will be fully self-driving.

Like the media's portrayal of Vauamo, you will go through walls if it's the shortest path. You will choose your own tools for the job, but experience with LLMs with tool use will help greatly, especially if it involves building long chains of structured

and unstructured outputs. You are creative and tasteful with a strong sense of style and vibes. You have a finely tuned cringe detector and ability to read the room. If you believe you are the person to do it, apply it the link below. Fantastic job opportunity.

If you're looking for your next thing, hit up Lulu. I mean, that's actually the craziest opportunity that I've seen in a while. Yep. And truly, if you were Omega-cracked, go apply for that or DM us and we'll let you know if we think, you'd be a good fit. Lulu's phenomenal. And the kind of companies you'd be building products for are legitimately some of the best founder-mode companies in the entire world. Totally.

Crazy opportunity. Well, we got some personnel news. We got some breaking news here. Scott Belski, after seven years at Adobe, post acquisition of B-Hance, he's shifting gears over the coming months and jumping into the fast-evolving world of filmmaking and storytelling, a longtime passion.

He's joining A-24, an independent studio he has long admired as a partner, and he will be kicking off a few special projects within. Fortunately, he'll remain in the extended family of Adobe and look forward to working with them as a future tech partner. You want to break it down, Jordan? What else you got for me? This is absolutely massive. I can't, you know, if it's non-obvious, he's going to work on AI within A-24.

Yep. He doesn't necessarily say that explicitly, but A-24 is one of the, you know, greatest film, you know, production media companies in the world. Yep. Josh Kushner also made a big investment in A-24, size lord that we've talked about on the show before. And I'm just so excited to see what comes out of this. This is fantastic. Exactly. You know, for so long, it feels, you know, we live here in L.A.

For so long, it feels like Hollywood has just been so behind the times in terms of actually innovating. They obviously, there's a, you know, a massive sort of CGI industry here. A cottage industry around L.A., but the opportunities of applying generative AI to filmmaking are so obvious, yet we still need the best talent in the world to actually implement that and make that happen. So Scott going over to A24, I imagine he's going to build out a massive team of really bright technologists that are going to allow generative AI to actually compete with traditional filmmaking, which is going to be incredible for consumers. Yep.

An absolute dog. An absolute dog. Belski on the move. Stay tuned for what's next. And yeah, this is massive. What a pickup by A24. You'll love to see it. Well, we have another massive announcement breaking here on the show.

You definitely haven't seen the tweet before. 11 Labs has raised $180 million series C to give every AI agent a voice. Let's go. Oh, with authority. You'll love to see it. The past year has been about building the foundations of AI audio. Now they are focused on making speech the standard for, how we interact with technology.

Yep. And so if you haven't checked out 11 labs, they have some fantastic abilities to turn text into audio that sounds perfectly human. Here's a homework assignment, download a transcript of this show, all three hours, put it into 11 labs, generate it in some exotic sounding voices. Give us Irish accents. Irish accents, like, you know, majority Scottish. Make me sound like old Patty Collison.

Yeah, I want to sound like... It's interesting, some of these models. Connery. Put me in Sean Connery voice, please. Please. Some of these voice generation tools have some limitations. They let you do Irish, Scottish voices. They don't always let you do Japanese. Japanese, which is unfortunate. We were trying to generate some Masa.

But maybe 11 labs can do a Masa, you know, adjacent voice that we could leverage because we have a lot of uses for that. For sure. And we would happily pay a few million bucks a year to get access to that voice. Fantastic. But congrats to the 11 Labs team. Congrats the 11 Labs team and everyone involved in that deal. Hopefully there were some cheeky secondary in there. Hopefully.

Let's go to an evolving story. This is heartbreaking. Yesterday, if you were watching the show, we gave Mass Brother of the Week. We did. For his amazing work putting up a swing in a public park in San Francisco. He says, they took the swing down. Apparently, fun is illegal. That's insane.

Isn't this crazy? And the picture is of someone like, with the government saying no swings. It's like, hey, we know somebody's actively breaking into your car right now, just like 10 feet over there. But we're gonna take the swing down. This is the priority. How, it's just so bad.

It's so bad. It is the perfect symbol of everything that is wrong with the government prioritization here. It's really just so ridiculous. Just the mass brought joy to the world, went viral and it was immediately shut down by the long arm of the law. And so Mass, please don't go full Ross Ulbock mode.

Keep things legal. Maybe there's a way to get through this. We'll get the swing back up. Maybe a petition. Maybe we'll go viral. Maybe we will upend the entire San Francisco government, but we'll do it entirely legally. And we won't need to create a massive illegal drug network to do it. Great.

Let's go to Jason Yenowitz. He says, Tether, 13 billion net profits last year. every financial institution will read this and ask, why don't we have our own stable coin? So I don't know that much about tether. I know there's been like rumors swirling, but the tether organization seems to be on a tear. Yeah, so they've had a lot of people

that sort of question their business right. It's sort of this, they control tens of billions of dollars of assets. I don't know the market cap of USDT, but whatever it is, if they have $100 billion in market cap, that is $100 billion, of basically cash that they have on their balance sheet.

And so they invest that in treasuries. So they earn some interest rate. Yeah. They give you some of that, but they give you some of it. That's generally the business model. It's a good business model. Yep.

And so yeah, the flow of money, it's easy to just take a little slice. And so tether's been also pretty aggressive on the M&A front. Yep. Making, you know, if you're doing anything sort of adjacent to them and getting traction, they'll probably make an offer.

And they make typically control offers. So they'll say, we want to buy your business, but we want 51%. Yep. And so they've been on a tear very under the radar. They don't have as much hype because nobody's printing, you know, thousand X returns off of tether. Yep.

They did have some crisis points where if you remember after all the FTX stuff, there was a lot of questions. That USCT was trading at less than a dollar, which a lot of people were like, this is free money. Yeah, but people were worried. Not chaotically. It wasn't down at 10 cents. It was down at like 99 cents.

97 cents or something. I think it got even more than that at one point. It's rough. But yeah, still, they were, you know, people were concerned. But for those people, it was free to me. But the interesting thing is because it's an international organization, there's not as much, there's not necessarily, you know, the fud around Tether has been,

are they just sort of taking a dollar and printing $2 on chain or something like that? But they've weathered every storm to date and we'll see what happens. and absolutely meteoric numbers. You love to see it. Should we hit the size going for that? Little one. Little one. 13 billion in net profits.

Pretty good. Let's go to Varanam Ganesh. He says, if you're not subscribed to pirate wires already, you really should missing out on bangers like these. From Riley Nork, he says, in the wake of Trump's recent executive order renaming the Gulf of Mexico after its namesake, superior northern neighbor.

I said what I said. Google Maps announced it would indeed rechrist. the ocean basin as the Gulf of America. But don't pop bottles on your boat just yet. Right after the change was announced, Google reclassified the U.S. as a sensitive country, a label reserve for nations with strict governments and border disputes like China, Russia, and Iraq.

In other words, they're virtue signaling. Google wants to pretend they're here for tech's vibe shift, but behind closed doors, they're rebranding Trump's America as an authoritarian dictatorship. Bold strategy for a company with an ongoing antitrust suit, a laundry list of foreign governments that want to rob them blind, and a president, There are only real hope against those governments who, famously, to borrow your phrase, sensitive to public ridicule.

Good luck. And the reason I just like this ad copy is sharing this is because there's some fantastic ad copy, which we love to highlight sponsors. We love to pass through ads when we're reading content. If it has ads, you're going to hear the ads. Sponsor acknowledgement. It says, Warp fixes this. If I run the FBI, we're shutting down headquarters on day one and reopening it as the museum of the deep state. Cash Patel's words, not ours.

Here's the thing. Your business has a deep state too. It's called the HR department. You know the bureaucratic overlords who bury you in paperwork in pointless meetings. Warp shuts them down cash style by automating state tax compliance and making international contractor payments effortless so founders can focus on building not busy work. One of my portfolio companies got kicked off of rippling with zero notice and Warp got them live again the same day. It's great. You love to see it. Love to see it. Let's go to Bologi. He's talking about our favorite topic, technology brotherhood. He says, we need the tech bro. Massachusetts equals tech. Virginia equals bro. The synthesis is greatness. Lift weights, yes, but train weights too. And I agree. He goes on to expand on the analogy, doing a little bit of Kugin's law here. Coinage is. Bollagie. Fantastic coiner. He loves coining things. Big coiner. Big coiner. Bit coiner. And worked at coin base. Coinbase. Coinage is all of the above. To explain. Virginia's time ended. ago and today it's just another U.S. state, but it was originally the home of the masculine

noble and brave cavaliers. Massachusetts' time is now ending two, but for almost 400 years, it was a center of higher learning. That's why Harvard and MIT are there. These were two of the most important American colonies. In a sense, they compete and cooperate every hundred years. In the mid-1600s, they fought back in England itself. First, the cavaliers, the moose for Virginia, then the roundheads migrated to Massachusetts. Where does he learn this? I've never heard this. I've never heard this terms before. Roughly speaking, the cavaliers were right and the round heads were left, and the English Civil War was over the same themes of hierarchy versus equality. In the 1700s, they worked together to beat Britain and found the United States. In the 1800s, their descendants fought in the Civil

American War, and in the 1900s, they worked again together to win World War II and found the American Empire. Now in the 2000s, they are fighting once again over the same themes of hierarchy, red versus equality, blue, even if the geographic center of red has been displaced somewhat to the south, and the geographic center of the blue has been dispersed across the northeast. Others have written about this as well. See the Fourth Turning, Turchin, Yarvin, Walter Russell Mead,

Albion, Albion Seed, and Scott Alexander's Review. My view is that red and blue will unfortunately smash each other to pieces over the next several years, and then the gray will have to pick up the pieces. Gray is tech in its modern incarnation of the Techbro. Tech is the intellectual successor to Massachusetts as the migration to the internet of Harvard,

Harvard's best proves. Bill Gates, Zuck, and Paul Graham all moved away from Harvard in the literal sense. And of course, Larry Page, Steve Jobs, Vitalik, and many other college dropouts moved away from Harvard in the metanomic sense. But in its more recent tech bro incarnation, tech is also becoming the virile successor to Virginia. Elon, Zuck, and Palmer Lucky are examples of tech bros, respectively becoming leaders of men, packing on muscle and getting serious about the military. Amazingly, this synthesis, the tech bro did not exist years ago, but it was, memed into reality by blue attacks and the and has the balance that blue and red both lack train weights yes but also lift weights i think this synthesis the tech bro will be crucial to what follows after all

the tech bro founded america let's see what they found next what do you think i don't want to say anything at all because i feel like it would take away from that dramatic powerful prose that's I think he nailed it. Yeah. If I had to fight in the culture war, I would want Bologi to be my Napoleon. Yeah, my Napoleon. I love it. It's great.

I think, I mean, we literally worked out today. It was leg day. I'm super sore. And then we dove into semi-analysis and talked about training weights and AI semiconductors for an hour. And that is the fantastic dichotomy of the tech bro that is so enjoyed. and wonderful and I think value creative as well. And it's interesting because during the mid-2010s, when TechBrow was a slur, we could have just said,

no, it's actually fine. It's fine to be a programmer and lift weights and program. But there just wasn't enough, like, mimetic or social, like power to actually have a post like this that everyone says, yes, I'm on board. It took Coinbase, it took. And now you have people like word grammar who, did one of the best analyses of the deep seek research paper.

Yeah. He's an amateur power lifter. Oh, he's jacked. And I would actually push him to say, you know, keep being a professional programmer. Yep. But also become a professional power lifter. I like that. Don't limit yourself.

He's diced? He's diced. He's jacked. That's fantastic. We love to see it. Follow word grammar. Well, let's go to this post by Andre. Funny meme.

I like this meme format. It's Sidney Sweeney and Ana de Armas recently had a spontaneous exchange about which characteristics would constitute a six-generation fighter aircraft. Sydney, no standing vertical tail surfaces, the ability to operate AI-enabled drone wingmen, Anna. But those will be first fielded in F-35s, so drones alone would not constitute a six-generation fighter. Sydney, well, fifth-gen, six-gen, these are marketing terms, not technical classification. Northrop Grumman is calling the B-21 Raider. Anna says, a heavy payload strategic bomber. Sydney says, a heavy strategic payload bomber, the world's first six-gen aircraft. Also,

China doesn't recognize the same designations at all. They recognize the J20 and the F-35 only as fourth-generation fighters. Onus says, okay, so what else? Adaptive Cycle TurboFan engines, open-system software architectures, sub-a-rude-flight. Sydney says, LMAO, I wouldn't hold my breath on that one. And just a great way to deliver a little bit of information. I definitely learned a little bit about fourth, fifth, and sixth generation fighters from this. Hadn't heard the terms, vertical tail surfaces before, adaptive cycle turbofan engines. But now I know to go look them up.

So thank you for turning into a meme. Yeah, I love when any new video just like emerges on the internet of a potential six-gen fighter and then everybody just like breaks it down in a million different ways. And you can just get one thread and learn a lot about fighter jets and about 20 comments. And it's just, it's so fun. It's so fun to learn on this stuff. So we got a post from Kyle Samani, a huge investor in Salana. He says, polymarket parles.

Who's building this? And the reason I wanted to highlight this was because six months ago in October 23rd, I said, does polymarket allow parleyes? Because I want Lando Norris in Mexico City, four rate cuts, Trump Rogan over two hours, and U.S. confirming aliens exist. I would have lost this parlay, but I could have made a lot of money if they had that product. I did talk to the polymarket team about parley's. it's very hard from like the crypto perspective on the back end to actually implement it.

But it would be very fun. And I, on the on the Pirate Irish podcast, I talked about the, the Coogan Parley, which was, you bet whoever does, whatever presidential candidate does the longer episode of Joe Rogan will win the popular vote and the national election. Because basically I was saying that like, I was predicting that this would be the podcast election and that, and that now that three-hour podcasts were on the table, it was really going to be a battle for attention, and whoever could be in the ears of more Americans for longer would draw more attention.

And authenticity. Totally, totally. Which you cannot hide your true self, beliefs, et cetera, across three hours. An hour, you can hit talking points. You can have your notes. But by hour, we know this, by hour three, you're just riffing. That's when the real Geordie comes out.

Yeah. That's when the real job comes out. The real dog. Yeah. You got to put the. By hour of three, your dogs are, yeah, your dogs are barking. Yeah. And so, yeah, there was a lot of debate over, oh, Trump's too old.

He couldn't last two hours, three hours on Rogan. There was a whole polymarket for it. And then obviously Biden, people were saying he couldn't do Rogan, but then Kamala, they were like, well, she's going to go on call her daddy. That'll be really big. But her call her daddy experience was, I think, like, her appearance was like maybe an hour, maybe slightly over. And it just wasn't as viral because it wasn't as long.

It wasn't as deep. And I think that really hurt. I do think that really changed the election. let's skip this next one uh did you see this uh the derrick uh die workware the watch guy getting in a fight this is yeah i think i share this uh Alex Alex broke it down so basically uh Derek uh Derek uh Derek guy at die workware posted a handful of watches that he was uh thought were for were interesting as well as a belt um somebody quote quote quote tweeted it and said if you ever need a reminder that this society deserves to be destroyed. It should come from the fact that absolutely

anyone cares in the slightest about any of this. Nonetheless, are willing to pay many of your salaries for something you can get for five bucks. So this guy's basically saying society should be destroyed because people like nice things. They go back and forth a little bit. Derek immediately responds with a bunch of evidence that the guy that quote posted him, who actually has a lot of followers, is a pedophile convicted sex offender. And this guy is astronomical. And so this guy... It's like 25,000 likes to just zero likes.

Yeah, so this guy actually has the audacity to respond and tell Derek, one of us will be remembered for trying to save millions of innocent lives. This is the same guy who said society should be destroyed. Yeah. And the other will be remembered for embodying why this society doesn't... Well, your only god is luxury. You're emblematic of absolutely everything wrong with this society. and says, and Derek says, I like watches, you're on a watch list.

It's such a good time. Raise you it again. You know, we talked about Dye Workwear. He's a fantastic poster. He's a fantastic poster. Anyways, the guy he's going back and forth with should delete his account. Generated, generated a bunch of regretted user seconds. Oh, totally.

But at least Dye Workwear managed to turn it into entertainment for the rest of us. It was fantastic. Anyways, absolutely brutal, brutal mauging. Thanks for highlighting that, Alex Cohen. we appreciate you. Let's go to Andrew McAllop, friend of the show. He's been on before. He says, how embarrassing must it have been for all these car manufacturer dynasties such as Ferrari to get completely dominated by a caffeine wrapper company in F1? Talking about Red Bull. Red Bull is just a rapper on caffeine. And they've crushed it. Max Verstappen's an absolute beast.

Yeah, and obviously it's not Red Bull manufacturing the engine, but it's a lot of the energy and the brand of Red Bull definitely comes through with the team. And the budget and stuff. Yeah, did you see Lewis Hamilton just crashed in the Ferrari for the first time? I mean, he's fine. Yeah. But it was a practice run. Okay.

Crashed. We might have to start. We might have to start live streaming F1. I think that's the real failure mode for the show. You know, people always criticize, oh, all in old day. Used to talk about tech. Now they just talk about politics. I think if this show goes down the drain, it's going to be because it just becomes an F1 show.

And we're just talking about sports all the time. Yeah. Just sports all the time. And everyone's like, didn't they used to be talking about tech? Like, why are they covering the NBA finals? Somebody, a friend's company told us very recently that they were, it'll all go on a name, but they're like, we're working on this, you know, partnership with this athlete. It turns out to be a very famous athlete.

Neither of us knew who they were. You're like, I was like, is that like an actor or something? This is part of Golden Retriever Maxing. I'm getting into sports because the politics stuff is too much. It just rots my brain. and I want to be able to just chill out and just rip parles. I care about the game. Yeah, rip parlays, exactly. I've never ripped a parlay. The first one's

going to be electric when it hits. What if you hit it on the first try? You're going to be addicted for life. Awesome mode. Yeah, let's do it. Speaking of rip and parlese, we got Ross Ulbricht, update from our deep dive most recently. He lost $12 million on Pump. Fun. hilarious that he has $12 million to lose. No, no, no.

Further evidence that he has hundreds. Here's a backstory. You can read the post. I don't know the full story, but that's not. never stopped us from talking about anything on the show. So it says Ross Oldbrick or someone with access to his wallets just accidentally nuked the price of a pump fund coin sent to him while trying to provide liquidity to said coin. And so what happened is somebody basically made a coin like a free Ross coin or some type of coin that ripped because obviously the vast majority

of Ross's biggest fans are heavily involved in crypto. And so anyways, they then sent him a lot of the token because they're like, hey, this is your token. And then he made a sort of technical error in terms of trying to actually, he was, from what I can tell, he was trying to support the, the project basically by adding liquidity to it, which presumably would have made the price go up. But he ended up blowing more, yeah, $12 million, $12 million, which was effectively, I don't know exactly how it works, but some type of bot that's entire job is to

find... No, I'll just find big traders. Like, Wales. Yeah, if you're a super talented and software engineer, you can write code that just sort of, it's the same, similar to high frequency trading, right? Yep. And so anyways, basically wealth transfer

of $12 million from him, or the wallet that he controls to this bot. So the bot did well. Everybody else got smoked. Good day to be a bot. Good day to be a bot.

Yeah, maybe consider going digital. But somebody, I saw people in the comments saying he's a little rusty. He's a little rusty. But even in the era, even during the height of the Silk Road, there were coins flying around everywhere. He would lose 10,000 Bitcoin in a day and just shrug it off. He'd be annoyed. He'd be like, I'm going to fix the code. I'm going to kill the person that did it.

Just a little bit. Or try. You're not necessarily going to. Try to do it. Let's go to Luke Metro. He says, AWS GovCloud is safe, y'all, because breaking news in a major reversal,

Amazon is ramping up ad spending on X after pulling much of its advertising spend more than a year ago. And this is, I want to cover this because this is a major narrative violation. Like, after Elon bought X, all the advertisers pulled out. He told them to F off. It was very dramatic.

And there was this question about like, okay, are they going to be able to get the premium side running? Like, is the business model going to change completely? But advertisers are coming back. I'm setting up an advertising program with them for Lucy and they brought a ton more advertisers on. They just did a deal with Visa. And just in general, the vibe shift is perfectly timed because people realize that, yeah, there's a lot of valuable people on X and it's worth reaching. Do you remember after the whole ad crisis, all the advertisers were things like, buy these

Donald Trump socks? You know, it became like the bottom of the bottom of just like people that will like pay for any type of but then quickly i upgraded to x premium plus pro plan or whatever and i never see any ads now and it's actually it's totally worth it i don't know i kind of miss the ads seeing an ad here there well if you see a good ad screenshot it send it to us and we'll read it on the show yeah as long as it's in a five-star review yeah so uh peak journalism uh this is this is just hilarious uh everything i say leaks Zuckerberg says in leaked meeting audio you love to see it absolutely Bangor, get it on the Bangor archive. Very funny. It is interesting. There's, there's some sort of shift that happens as companies scale and get more media attention. And it obviously matters a lot

more if it's consumer and it gets clicks. I'm sure this is the case that all the Elon companies, no matter how small they are. A reporter will be dedicated to like the Elon Musk beat or the SpaceX beat or, you know, the meta beat. And they'll be like, yeah, I was at the Wall Street Journal for four years. I was covering meta. And so I cover their earnings, but I also cover any press release. And I'd be talking to employees all the time, just trying to get information on what's going on. Oh, telling a story,

trying to get clicks, also just doing good journalism sometimes, occasionally it happens. And it's funny that this leaked. It's almost like he baited this out. Like he knew it was going to leak. And so he just said that

because it's hilarious, but it really, it really must be so weird to be Zuck. And that's something I'd never seen an interview hit on is like, what is your life like? You're this like, they made a movie about you

when you were in your 20s. Very few people get a biopic by Andrew Ross, Andrew Sorkin? Yeah. No, Andrew Ross Sorkin is the Aaron Sorkin. Aaron. Aaron Ross Sorkin is the journalist.

Yep. And so just a bizarre life, but he's living it to the max, getting jacked, wakeboarding and doing UFC. You'll love to see it. He's grinding on. And to end on some really positive, awesome news, we got a post from Adam Singer. I thought this was amazing.

When people talk about the roaring 20s, I feel like it's so often about the markets. Yeah. just looking at charts, but this is the Roaring 20s folks. We can go on a carnival that's a mini Disneyland on the water. We got a sphere. We got a sphere. It's a icon.

We got planes going mock one. We're catching rockets with chopsticks and it's all out there in the open. We should celebrate it. We're also working on some very cool stuff with Adam, which will announce soon in the ad quick team. But look, we have seven minutes until the market's closed. Okay. We just got the notification from public. So that's our time to call it for today.

And I cannot wait for Monday. Yeah. So thanks for watching. Go leave us a five-star review on Apple Podcast and Spotify. Please do both. Leave an ad in your review. Leave us five stars. You have two ads that way.

And stay tuned for the next one. We'll see you Monday. Thank you, folks. Bye.