TBPN - Open-Source AI, a16z's Playbook | Marc Andreessen & The a16z Partnership, Bryan Johnson, Chris Pedregal, Joshua Browder

Episode Date: May 14, 2025

TBPN.com is made possible by:Ramp - https://ramp.comFigma - https://figma.comVanta - https://vanta.comLinear - https://linear.appEight Sleep - https://eightsleep.com/tbpnWander - https://wander.com/tbpnPublic - https://public.comAdQuick - https://adquick.comBezel - https://getbezel.com Numeral - https://www.numeralhq.comPolymarket - https://polymarket.comFollow TBPN: https://TBPN.comhttps://x.com/tbpnhttps://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231https://podcasts.apple.com/us/podcast/technology-brothers/id1772360235https://youtube.com/@technologybrotherspod?si=lpk53xTE9WBEcIjV(03:10) - Is Open-Source AI Dead? (04:35) - OpenAI Restructuring (18:50) - Investors Comment on Open-Source AI (31:33) - Chris Pedregal. Chris is the founder and CEO of Granola, an AI-powered notepad designed to enhance productivity during back-to-back meetings. Previously, he co-founded Socratic, an educational app acquired by Google. (45:17) - Joshua Browder. Joshua is the founder and CEO of DoNotPay, the world's first AI-powered legal service platform aimed at automating consumer rights processes. He also leads Browder Capital, focusing on investments in innovative legal tech startups. (01:01:32) - Bryan Johnson. Bryan is the founder of Don't Die, a longevity company pioneering protocols and tools to slow aging and extend healthspan. Through extreme self-tracking and data-driven experimentation, he aims to build a roadmap for reversing biological age. (01:21:28) - Matteo Franceschetti. Matteo is the co-founder and CEO of Eight Sleep, a company that integrates technology into sleep products to optimize health and performance. His work emphasizes the importance of sleep fitness in overall well-being. (01:40:20) - Erik Torenberg. Erik is a general partner at Andreessen Horowitz, where he brings a decade of experience at the intersection of investing, product, and media. He previously founded Turpentine, a media company focused on tech and culture. (01:53:52) - Jen Kha. Jen is the Operating Partner and Head of Investor Relations and Fundraising at Andreessen Horowitz (a16z), where she leads the firm’s capital-raising strategy and manages relationships with limited partners. Over her career, she has facilitated the raising of over $40 billion in capital, drawing on her experience from roles at Technology Crossover Ventures, HSN, Inc., and BMO Capital Markets. (02:04:54) - Anjney Midha. Anjney is a general partner at Andreessen Horowitz, investing in AI, infrastructure, and open-source technologies. He serves on the boards of several AI startups, including Mistral and Black Forest Labs. (02:21:53) - Martin Casado. Martin is a general partner at Andreessen Horowitz, leading the firm's infrastructure practice. He was a pioneer in software-defined networking and co-founded Nicira Networks. (02:31:45) - David George. David is a General Partner at Andreessen Horowitz (a16z), where he leads the firm's Growth investing team. Since joining in 2019, he has spearheaded investments in companies like Roblox, Coinbase, and Databricks, drawing on his prior experience at General Atlantic with firms such as Airbnb and Slack. (02:47:27) - David Ulevitch. David is a general partner at Andreessen Horowitz, focusing on American Dynamism, investing in companies that advance national interests. He previously founded OpenDNS, a security company acquired by Cisco. (03:00:09) - Anish Acharya. Anish is a General Partner at Andreessen Horowitz (a16z), where he leads investments in consumer AI applications and innovative digital experiences. With a background as a founder of two acquired startups, he focuses on products that blend cutting-edge technology with exceptional design. (03:11:40) - Marc Andreessen. Marc is a co-founder and general partner at Andreessen Horowitz (a16z), a leading venture capital firm. He is also known for co-authoring Mosaic, the first widely used web browser, and co-founding Netscape.

You're watching TVPN. Today is Wednesday, May 14th, 2025. We are live from the Temple of Technology, the Fortress of Finance, the Capital of Capital. Ben is back. Ben is back. Ben is back. Welcome back, Ben. He found his happy place.

He found his happy place. It wasn't in a wander, although it could have been in a wander, but now it's in the studio and the Temple of Technology. Ben is back, baby. That was a huge milestone for the show. Yeah. to actually survive for 10 days without Ben. We were on a shoestring. But he's back.

But he's back. And he's back. And we're excited. Also, thank you to Sequoia Capital. They sent us some beautiful candles. They smell fantastic. High dimensional cardamom and violet embedding diffusing through hidden layers of spice back

propagating to a musk and sandalwood base. So thank you. This is from their AI Ascent Conference. They sent scented candles. Extremely well executed. Extremely well executed. And they sent us a nice little note here. It's from Sonia and the team at Sequoia.

Beautiful. She says, thanks for having me on the show to chat all things AI. It's no Himalayan Berkin, but hope you enjoy the candle. So thank you, Sonia. We'd love to have you back on the show. I really enjoy the conversation. Yeah, it was great. And we're going to be talking to quite a lot of venture capitalists today, John.

Yes. It's a gladiatorial battle. It's a one man versus a hundred-a-enital. 100 guerrillas situation. One show versus 100 injuries and partners. Let's take a look at the lineup. We do have four founders here, although one of them is raising a fund. Josh Browder, you know from Do Not Pay, but he's announcing his fourth venture fund.

That's pretty crazy. We were just talking about how few companies get to fund for. He did it. We got the founder of Grinola. Brian Johnson's coming in, the founder of Don't Die. We're going to get to the bottom of how not to die. Do not die before he comes on? Yeah, and Mateo from 8 Sleep is coming on, announcing the pod five.

We've heard us talk about the pod four. Now it's time for pod five. And then we're going live to A16Z's limited partner day. This is the day of the year that they check in with all of their investors. So they're all together and we got them all calling into the stream one after another. We got six GPs and the co-founder of the firm. So that'll be a lot of fun. But first, I wanted to set up the conversation because I think that if you're talking to Andresen,

what's the most interesting tech trend that they seem to be, they have a unique perspective on. And from my perspective, that is open source artificial intelligence. Mark has been very outspoken about his love for the open source community. They backed a bunch of open source AI companies. And it's been received very well in the open source community. And some investors love it. Some don't. And so my former colleague at Founders Fund, John Lutig, wrote a piece that we're going to be diving

into all about the future. He claims the future of foundation models is closed source, and he makes the argument that open source is not ever going to fully win, not that it can't be helpful or useful, but we've also been having some other conversations with folks that say open source might be a tool of economic warfare that we need to be engaging with, and maybe we haven't considered all the different angles. And so his piece is from a year ago. We'll see how it holds up today, and then we'll talk to a bunch of the Andries and

partners about open source AI. I wanted to kick it off with Ben Thompson, Instratechery, talking about Open AI's restructuring. We covered this when the news broke, but he kind of packaged it up in an update with a few different pieces of information, talking about how Microsoft's involved, talking about the hiring of Fiji Simo and the acquisition of windsurf. And so he starts it off with a quote from the Wall Street Journal. He says, Open AI abandoned a controversial effort to place its juggernaut artificial intelligence business under control of a for-profit entity.

and will instead remain under its founding nonprofit board. We covered this exact story in the journal when it dropped. And Sam said, hey, it's not that big of a deal. It's not that big of a deal. And then people were like, okay, it's not that big of a deal. Then we won't talk about it on podcasts. Yeah. Yeah.

Does he want us not to talk about this? Is that what he's saying? It's not a big deal. Don't make a three-hour podcast out of it. About this one thing. This one thing is no big deal. Well, too bad. We're making a podcast about it.

And it's four hours today, by the way. And so the move could complicate the company's future fundraising efforts. Obviously, it's very difficult to invest in a nonprofit, even though there was a wait for some cash to flow through. Unlike traditional boards, which must act in the best interest of shareholders, Open AI's nonprofit board has a fiduciary duty to humanity. I was joking that if they have a fiduciary duty to humanity, if you're human, you can just ask them to do things, can't you? Yeah. You can just submit them tickets.

I was telling Will, make me a to-do list app now. Do it. I'm human. So you're responsible to me. You're in service to me. Yeah. But opening I started working on this change after Sam Altman was surprised fired and then reinstated in 2023.

Its big investors, including Microsoft, watched his temporary ouster from the sidelines, unable to wield official power over the outcome because of the nonprofit structure. They couldn't just sue, hey, this is not in the interest of shareholders. And the nonprofit board was able to make a very convoluted argument for why they were so suddenly changing CEOs. The conversion would have changed Open AIs business to a public benefit corporation while preserving some form of the current nonprofit

that controls the company. Altman's rival estranged co-founder Elon Musk had tried to block the conversion in court. Open AIS said it scrapped the Boulder plan after discussions with civic leaders and attorneys general in California and Delaware, which would have been required to sign off. Yeah.

And so they probably just went to the courts and said, are you guys going to veto this? we try and do this? And they said, yes, absolutely, we're going to veto this. Very likely. Okay, we're not even going to try. That's what that reads like. I don't know. But anyway, the framing of this news and the tenor of the overall reaction has been interesting. Open AI is characterizing this as a clear step back from their initial for-profit plans. And most people seem to be taking them at their word. A small contingent, including Elon Musk, are on the opposite extreme, claiming that this is a total betrayal of Open AI's nonprofit roots.

Unsurprisingly, Stratory falls somewhere in the middle. middle. Ben Thompson, of course, with a twist. I do in fact think this is still a meaningful change, but also a fair one that does stay somewhat true to the entity's roots. And frankly, that's the part that worries me most. And so interesting, of course, that the open source company is now closed source. They're maybe releasing an open source model.

I don't know if you want to pull up the polymarket on whether or not OpenAI will release an open source model or what the timing is. But it seems like they do that at some point. It doesn't seem like a crazy strategy. Right now, it's sitting at, Will OpenAI release an open source model before July. Polymarket has it at a 48% chance. Wow, really 50, 50, basically. Yeah, still feels significant on 356K volume.

Okay, yeah. Yeah, not small. Yeah. Anyway, so we'll see. So Microsoft's obviously a big player in here. It seems like they need to sign off on whatever happens and they want a stake. And then there's also some crazy numbers about exactly how they've been. how much they've invested.

And so the core problems facing Open AI as a nonprofit were straightforward. Developing AI costs astronomical sums of money. Money at that scale is only available from investors who expect a return. And Open AI has no means to deliver a return to investors. Yeah. Basically, you can raise a few hundred million dollars as a nonprofit from people like Elon and Peter Thiel and things like that. But beyond that, you start to run out of, you know, they could have just

perpetually raised. Yep. They could probably have gotten to a point where they were perpetually raising $100 million a year. Yep. But not $10 million a year. And my take on this was like, it's beautiful that the future of AI must be capitalist.

And it's actually very good. And I think Ben Thompson kind of agrees with this. So he says, now you can certainly make the case that the most appropriate thing for Open AI to do at the point that they had this realization. And this was, and everyone started realizing that scaling laws applied in 2018 after they released the paper improving language understanding by generative pre-training. And this was confirmed with GPT2. They saw that they didn't really train, they didn't really change the algorithm. They just increased the scale of the data and the compute. And it got way better. And so they're like,

okay, well, we thought, if it was just genius application, genius algorithm design, all you need to do is just raise $100 million, get 100 geniuses in a room, turn them loose, and they would come up with the most beautiful, elegant algorithm for AGI. Give them enough time, they'll do it. But that wasn't the, that's not the solution. They need compute and they need energy and that costs money. And so they should have wound down the nonprofit at that point, is what Ben Thompson argues. And he says, I wonder if Elkman regrets not just doing that after all.

And this critical open AI had at that point created very little of commercial value to review the timeline of that critical 2019 period. February, Open AI releases GPT2. This was the model that showed simply scaling up model size, data set, size, and compute, produce more generalizable results. March OpenAI creates the OpenAI LP, a cap profit entity that could be invested in in exchange for a share of profits. And July, Microsoft invest $1 billion in Open AILP with the right to 100 X that's return. So they can make $100 billion. All we want is a right to 100x.

Yeah. Simple ask. Well, the funny thing here is that I'm pretty sure. 100 billion is less than what Microsoft earns in the year. So it is like a substantial sum of money, but it's not that much money to them. To put in context, $100 billion is $17 billion short of Microsoft's total operating income last year.

And so it'd be like a nice bump. It would be a double. Their EBIT was $131 billion. But it sounds crazy, but I mean, they put in a billion dollars. So the question is like, what's more valuable? They grew 20%. They grew 28%. They grew EBIT 28% from 2023.

It's amazing. Satya, on fire. Come on the show. Soon. Anyway, of course, Open AI and the rest of its investors almost certainly don't want to give up such a valuable asset. I'm not sure that they will have the choice. So the question is, should Microsoft go for revenue share

or perpetual rights to Open AI's models that they can vend into Azure? and they'd probably want to stick with the perpetual rights. The fact of the matter is that Microsoft put up the money to make Open AI an entity worth fighting for, and they would do well to give up future profits from Open AI to secure profits of their own. Assuming this deal happens, that leaves the nonprofit board, which has final say over the company and some amount of shares in the public benefit corporation. This is ultimately in line with Open AI's original structure, so I think it's a reasonable compromise. I don't like it, though, but not for the same reasons as though.

who think that any for-profit entity is wrong. Rather, I don't like the idea of an entity unconstrained by things like fiduciary duty or the profit motive, having ultimate say over what is shaping up to be such an important company. I get the theoretical argument for people motivated by the common good. I myself subscribe to the perhaps more cynical view that base motivations like profits and doing right by shareholders are important constraints against utopian visions that all too often end badly. And I completely agree. He's very, very convincing on that point. And then we can go through a little bit of the of the Simo, Fidji Simo and Winsurf News. So in an Altman email, Simo will enable our traditional company functions to scale as we enter the next phase of growth.

Altman keeps the top job and will increase his focus on research, compute, and safety systems. Simo is a technologist at heart, but a very pragmatic technologist. She loves consumer companies that have a big impact. That's why she went to eBay. And what else does she like? Ads. Oh, yeah. Ads.

Yeah. So now the question is, you know, you interview anyone from OpenAI. When are you going to get promoted to CEO? Because now if there's two CEOs, why not 50? Three, four, five. Yeah. Yeah. Unlimited.

Why stop at 50, John? Yeah, just keep going. I mean, this is an entirely uncharted territory. We've seen the co-CEO model before. Yep. We have not seen scaling is all you need. Scaling law applied to CEOs. Imagine. Do you think that's the value accrues to the most CEOs? CEO drives the most value, so get multiple CEOs. More CEOs. They need 10 more ooms of CEOs.

Yeah. Six billion CEOs. Then they'll be responsible to humanity. This is the way. It's very likely that the company that develops AGI will be entirely CEO driven. Yeah. Everyone acting like they run the company. That's great. And so, yeah, I mean, it's obviously like a big shift too. They're going all in to be the next big consumer app. And they're necessarily going to build an advertising product. And I was trying to think about this.

Like there is a world where you charge people $200 a month or $20 a month or zero a month. And the $20 a month subsidizes the rest of the cohort. But you have to differentiate the product at that point. And so you're essentially giving. poorer people, dumber AI, which feels a lot worse to me than giving everyone equivalently smart AI. But there's ads. Or everyone the same content, but you either watch ads or you don't or you

exactly, exactly. Exactly. So I truly, yeah, maybe it'd be nice to be able to pay to remove the ads. But I don't like the world where certain people based on their economic conditions. don't have access to the smartest models. I think that's very, very good. Who are we talking? I mean, who are we?

I honestly think it was Madfaz that we were talking about offline about how this dynamic that we've had where billionaires have the same iPhone as somebody working at, totally, right? That is not going to be the case in AI, and that's kind of the issue that you're getting at. Well, no, I think it ultimately will be the case in AI,

that it will be the same. Because I do think the ads, I do think the ads and the economics will lead to GPT5 being available to everyone, equivalently. And maybe there's less ads for certain people. Maybe there's certain usage limits or certain things that you pay for. But fundamentally it just seems so much better for humanity. If I'm paying $2,400 a year for Open AI as a pro-sumer, right, I use, you know, whatever,

I'm on the $200 amount of subscription, they could get probably $10,000 a year. year in ads in value from me as a user in ads. Yeah. Right. Hey. You got to raise the price on you. Yeah. To get rid of those ads. But no, the argument is that like Google, I would imagine, you know, like Open AI at some

point would have an incentive to just get so good at ads that they can extract the maximum amount of value. It's so cocky to be like, yeah, my Arpoo at Facebook. They make 20 grand off of me because they show me so many AMG G63s that they, they, They just print off of me. They just know. They found the infinite money glitch. They've shown me so many G-waggons that Mercedes has personally made the six figures this year.

He's already got two and he's like, that's ridiculous. Anyway, but obviously, you know, the company is shifting to, it's the, what do they call it, the unlikely consumer tech company, the unwilling consumer tech company. They just bought WindSurf. It's model agnostic, which is very interesting because you can use windsurf with anthropic, Claude. Yeah, some other news that was interesting. Harvey just announced that they're going model agnostic. Interesting.

What were they built on before? Open AI. Open AI's fund was invested in Harvey. Yeah. And so this is the point that Ben Thompson makes, which is that there is a world where chat GPT is powered by Claude. And no one notices or cares. Because all you care about is the app that being a great. front door to AI and you go there and as long as you get good responses, does it really matter

what exact model you're using? Not really, the actual underlying model matters a lot less than how that model interacts, the other tooling, the tool use, all these different things. And so we've got to dig into this more. Yeah, the other interesting thing here, and Ben calls us out, he says, the unusual part of this appointment is that Simo is currently a public company CEO of Instacart. And the best way to understand her decision is that it is better to be the number two at a generational company instead of the number one, basically anywhere else. And it's interesting to, you know, in many ways, Instacart was a generational company. Yeah. But it's 11 billion dollars right now. And it's been around there since IPO. It's actually fairly up since IPO, I believe, $25 when IPO. Now it's at

45. So it's done well. You remember they were. I think they were over 30 in the private markets. Oh, really? Yeah. But still, I mean, $11 billion, that's, what, 3% of opening I at the current valuation or something like that. But the takeaway is that if you're running a startup, why don't you just go recruit a CEO from public company to come work for you?

Totally, totally. Set your bar high. Massively underappreciated approach to recruiting. Yes. Just go look at the public markets, see which companies have executed well over the past call it eight quarters and then just go pick out your favorite CEO. So I want to shift over to John Ludig's piece on his substack, Ludig's learnings. He says, the future of foundation models is closed source.

If the centralizing forces of data and compute hold open and closed source AI cannot both dominate long term. So he was thinking about, you know, this was during this wave and this big meme that open source would just completely dominate and commoditize the foundation model layer. Some of that's happened, but then we've seen missteps with Lama4, and there's some interesting context in here, but it's a year-old piece, so it's interesting to reflect on how it's held up. And he got into a big debate with Martin Casado, who I believe is coming on the show in just a couple hours. And I'd love to hear how Indriason's view of open source AI has evolved because they've invested

in some open source AI companies and some closed source AI companies. And so I want to know how they're thinking about it. So John writes, too seemingly contradictory, but equally popular narratives about the future of foundation models have taken hold. In one future, AI centralizes, scaling laws will hold and value accrues primarily to scaled closed source players. In the other future, AI decentralizedist foundation models have no moat. Open source has caught up to closed source and will have many competing models. Today, both narratives seem true. We have powerful closed source models and a thriving ecosystem of sankersanked open source models. Lama 3 recently put open source on the map of GPT4 class models. Meanwhile, an unusual open source alliance is formed among developers

who want handouts, it's very controversial to say, academics who embrace publishing culture, libertarians who fear centralized speech control and regulatory capture, Elon, who doesn't want his nemesis to win AI, and Zuck, who doesn't want to be beholden to yet another tech platform. As an accelerant of... It's not letting it happen. It's simply not happening again. I will spend a hundred billion dollars this year to make sure this doesn't happen again. Yeah, yeah, 100%.

And this is what keeps him up at night. Yeah. Because it might be happening. For sure. But I think he's doing okay. Like the Lama models, they're not fantastic, but they're definitely good enough for enterprise use. And that's really the win case for enterprise AI or open source AI is seeing fantastic adoption in the in the, in the enterprise where you can fine tune it and tweak it and really understand the cost structure

and you can stuff it in all different parts of your enterprise. So as an accelerant of modern software, open source maintains a cherished place in tech who can argue with free stuff, decentralized control and free speech. But open and closed source AI cannot both dominate in the limit. If centralizing forces hold, scale advantages will compound and leave open source alternatives behind. Despite recent progress and endless cheerleading, open source AI will become a financial drain for model builders, basically this idea that Zuck will run out of investment dollars to pour into Lama if there's not a strong economic engine there. And that's the main argument here. And so open source software started as an act of charity. The world owes the

likes of Linus Torvalds and Fabrice Bellard for endowing humanity with Linux, Git, and FFMPEG. Because free stuff is popular, open source became a great freemium marketing strategy. Think Databricks or mistrawl and sometimes a market equilibrium in itself, e.g. Android, a cheap smartphone option and reinforces Google search monopoly. Companies that earned free marketing from open source eventually succumb to business physics, red hat hid CentOS behind a subscription service, Elasticsearch changed their licensing after accidentally seating competition and Databricks owns the IP that accelerates Apache Spark. So Apache Spark is open source, but you can't just spin up a Databricks instance, you have to license their IP, so you have to use Databricks.

Unlike the charity work of open source in the early software era, today it is subsidized by businesses. By the way, Databricks bought a company for a billion dollars today. Interesting. Got announced. Yeah. They announced this at 3 a.m. Pacific. I guess that's 6 Eastern, so not that crazy.

They're just on the Ashton Hall grind. Play the Ashton Hall sound. We're announcing something at 3 a.m. They are. Banana peel on the face. Many people have called Databricks to Ashton Hall of data analytics. And so John writes, that begs the question, if meta is only pursuing open source insofar as it benefits themselves, which he believes, like they're not doing it completely charitably. It's not a charity. It's not a nonprofit. What is the tipping point at which meta stops open sourcing their AI?

So sooner than you think, exponential data, frontier models were trained on the corpus of the internet, but that data sources commodity model, differentiation over the next decade will come from proprietary data, both via model usage and private data sources. And so the feedback loop in chat, GBT is what's valuable. The thumbs up, the thumbs down, the follow-up questions. You issued a response. Did they close the app because they were satisfied or did they ask you 25 more for follow-ups to get the real answer? So open-source models have no feedback loop between production, usage, and model training. So if you're running Lama, that data doesn't go back to Facebook. Exactly, exactly. And then there's exponential cap-capex, a lagging edge model that requires just a few percent of meta's 40 billion

in CAPEX is easy to open source. Nobody will ask questions. But once you reach $10 billion or more in CAPEX spend for model training, shareholders will want a clear ROI on that spend. The Metaverse raise some question marks at a certain scale too. Diminishing returns on model within meta, there's a large upfront benefit for meta-building open-source AI model, even if it's worse than the frontier closed source counterpart. There are lots of small AI workloads. think feed algorithms, recommendations, and image generation where meta doesn't want to rely on a third-party provider like they had to rely on Apple.

But it's unclear whether Facebook products benefit much from models approaching AGI quality. It's equally possible that meta's model improvements will be very particular to their own internal use cases. And that's like what we talk to that the company that trains small language models. Task-specific? Yeah, they had task-specific models. And so you could imagine that... figure out the new bit. A lot of META's AI workloads are not going to need AGI AGI level universal.

Fastino. Fistino, that's right. Fastino AI. Yeah, fastino. And so, so you can imagine that there is a fastino like, TLM's task specific language models. And so you can imagine there is a fastino like team inside of meta actually figuring out, okay, we just need to translate every caption. Let's build a model specifically for that.

or we just need to flag everything for profanity, right? Like they could build a model for that. And they're not going to need AGI-level massive models for that. And so Zuck is not running a charity. He's a savvy capitalist. While meta can justify scaling CAPX on incremental models for their own ends, their open-source strategy will only make less sense over time. And so then John goes into developers and consumers.

As a developer, choosing an open-source model, what do you get in terms of cost, model, quality, and data security? open source models have the illusion of being free, but developers bear the inference cost, which are often more expensive than comparable LLM API calls. You either pay a middleman to manage GPUs or in host models or pay the direct cost of GPU depreciation. In Capitalist America, free is never really free. You should wonder how you'll ultimately be monetized. This isn't Linux where a single developer built the product as a gift to humanity.

These are cash incinerating endeavors whose only way out is to eventually monetize you. You're probably committing to a closed source compliment in time. I'm not afraid to be monetized. Yep. Are you afraid to be monetized? I'm fearless about being monetized. Monetize me. Go right ahead.

Even Android eventually monetized via Google Play and search. There's like a pretty good, you know, metal song. You know, monetize me. On model quality, like housing, health care and education, a paid version is generally better than the free version. Even within software, the open source winner is rarely the best product. Android is worse than iOS. Open Office is worse than Office or Google Docs. Godot is worse than Unity. FreeCat is worse than Solid Works. A corollary is that engineers focused on the best platforms make more money. They're more likely to build cutting edge products. Everyone's celebrating Lama 3. Yeah, here's the kicker. Everyone is celebrating that Lama 3 is on par with GPT for a year later. A year later. The product quality gap between iOS and Android or MacOS and Consumer Linux has stayed wide for a long time because the best software creators are aligned with paying for. customers. When you choose closed source models, you're not making a point in time decision on model

quality. You're paying for future model improvements where the roadmap is aligned with paying customers. Yeah. And then he talks about data security a little bit. Some enterprise need the utmost data security, financial services, healthcare legal, but I'm not sure using open source models on-prem or via third-party cloud. Hosting is actually safer than using third-party LLMs in the cloud. This is a legacy belief from the early internet era where an on-premise data center was the fort knocks of data security. As a customer, I'd trust Microsoft with healthcare data security more than my IT department's self-managed data center. Ooh, putting Founders Fund's IT department on blast there. But very nice, very nice IT department over there. They're very nice. I know them. And that bridge has already

been crossed when 65% of the risk adverse Fortune 500 already uses Azure on OpenAI. It makes you wonder who is dealing with data that is too sensitive for cloud-based LLMs, of course. And so then he goes into national security, and this is why I wanted to pull up that Aaron Ginn clip, which will play in a second. But even if it makes eventual economic sense for model builders to build open source, should they? Advocates like Yan Lecun claim that open source AI is safer than closed, but it makes me wonder if he really believes in meta's AI capabilities. Any reasonable extrapolation of capabilities with more compute data and autonomous tool use is self-evidently dangerous. And we've talked to some other folks about this. So let's play the Aaron Ginn clip because I want to react

to that. But the new AI gunrun initiative has already started, already around the world. We know this. We see them at different data centers that we work with selling their stuff. And it comes as a completely complete solution with deep seek open like a manis models combined with infrastructure combined with support. Manus has has that kind of distribution already. You're not talking about. No, like Huawei is designing for their their open source ecosystem. So so Huawei is being

is being the hands of heat out they're building. I think what George's asking is like, have you ever run into a country that's not China that's like, yeah, we have Huawei ascend and then we have Deep Seek and then we have Manus because Manus came out of nowhere just a couple months ago. Feels like that would be a very quick ramp to be like, it's deployed in another country as a part of the AI Belt and Road initiative.

Deep Seek, I can believe. It is. So give us the update on that. Yeah, yeah, yeah. It's deployed. Deep Seek and Manus are everywhere in Europe. like they're there are everywhere and again it's open source it's open source works as a distribution strategy they're not open source because they give they they try to care they don't care about

open source they care about defeating us and and and so the approach that this is why uh open i made that announcement of we're going to do like this combined deployments of software plus like infrastructure is because that's they're mimicking what trend is doing um but but the proliferation of the open source models go look at open writer like you can just see the growth in other models Those other models are Chinese. Okay. So there's this debate about now. So where I think John left off is that if we're open sourcing all American AI and truly

the best American AI, you're immediately giving it to near peer rivals geopolitically. And that's risky. What Aaron is saying is that if we don't do it, they will. And there could be this AI Belt and Road initiative where a country that's a little bit more of a coin toss might say, hey, my options are pay open AI a ton of money or use the free Chinese model. I'm going to go with the free Chinese model and that draws me closer to their economy and that pulls them away from us. And so in terms of forging durable relationships with countries that are kind of on the brink or could go either way, having a strong American

secure open source AI ecosystem might actually be an advanced. to us in terms of like broad AI economic warfare. And so yeah, and the question, that's something that I've been like towing with. I think the question becomes how much does being able to deploy that truly bleeding edge leading models matter, right? Does it matter if you're deploying, you know, GPT6 versus the open source CCP equivalent of GPT5, right? How big of a difference is that, right?

everybody's going to have a different take. But yeah, we got... Let's dig into it today. Let's tell you about ramp real quick. Time is money saved both. Easy use corporate cards, bill payments, accounting, and a whole lot more all in one place. And let's invite our first guest into the studio. Welcome to the show.

How are you doing? It's Granola time. What's happening? Congratulations. How you doing? We're doing great. Would you mind introducing yourself in the company a little bit? Totally.

My name's Chris. I'm the co-founder, CEO of Granola. how much you wanted me to tell about it? Tell us everything. Yeah, I mean, in two minutes. It's specifically the evolution of the product because I know people think note taking but you're doing a lot more.

So give us kind of the, what was the initial minimum viable product? What's the product today? Where is it going? Totally. So we launched Grona a little under a year ago and the idea was the best way to take notes during meetings and to do that in collaboration with AI.

So it's an app that lives on your Mac. It looks a lot like Apple Notes. You can take notes however you want, but it listens to the conversation in the background. And when the meeting's over, it'll rewrite your notes to flesh them out to make them great. Yeah, and that's the basic product. We try to keep it super simple, really minimal.

And I mean, I think that design resonated. I think we can talk about that, I think there are a few things about the way we built that that people really liked. And then I think what we noticed happening was that once you start using granola, what happens is you have a meeting and like a notification pops up saying, hey, you do this meeting starting? Do you want to use granola for it? And once you start using granola for lots of meetings,

it kind of becomes this like searchable second brain repository thing. Like you can kind of be like, hey, what did that person say? And you kind of turn to it. And we noticed lots of users doing that. And then kind of the evolution, like what we launched today is now you can do that across your team. So like now you can chat. We added a bunch of support for these great reasoning models and you can chat across meetings across your whole team and ask questions. And I mean, it's a stepping stone towards like the bigger vision of where we're going.

Yeah. But yeah. Tell me about search. Are you stuffing every granola note into a vector database or are you just doing the huge context window? What are the different strategies to actually surface insights? I mean, it's definitely evolving. What we found is like rag or like stuffing it into a vector database is really good for certain types of like information lookup, like search.

What it's what it is terrible at is basically if you ask questions like, hey, like coach me. Like how could I be better in my one-on-ones, right? Or when let's say you're trying to sell something, it's like, hey, when I get this type of question, like how good are my answers and how does that compare to the answers that other folks on my team give? Like, it completely, rag completely breaks with that. And what we find is people turn to Grenoal to ask a lot of these kind of analysis type questions. Like, hey, what are the biggest burning fires, right, that I should be focused on or something like that? And rag's not suitable. So we actually make a lot of use of stuffing these massive context windows with the right, with the right transcripts and notes. What's the favorite context window to stuff?

I know Gemini's got a big one, but Yeah, yeah. They all have trade off. Do the big ones scare you. Yeah, the big ones scare me. Open AIs context windows. Perfect. We just, we just today, starting today, we let users choose.

Before that, it was, you know, we do it. Everyone's going model agnostic. This is a trend, right? Yeah. I mean, when the surf is model agnostic now. Who else were you saying? Harvey just went model agnostic. This seems to be the trend.

Really, you're drinking the commoditization Kool-Aid. Yeah, the product person in me feel, I have mixed feelings about surfacing it to the user. It's like one more thing a user has to think about. And your average person shouldn't have to think about. We should do the best thing. So it defaults to auto. So we try to choose the right model, which for a lot of it is like Sonic Cloud 3.7, like the reasoning mode of it because we find that for the type of queries that we're getting is it works the best.

But, you know, if you're a power user, now you can choose Gemini, 03, like, whatever you want. Cool. I got to ask, what was your reaction to Notions launch yesterday? Many people said it was a granola clone. Do we have a shots fired? Yeah, we need like a shots fired sound effects. But, yeah, I'm curious to get, you know, your reaction to it. I'm sure it's not even the first time that somebody's taken a little inspiration from you guys over the last year.

I mean, it feels like it means we're doing. something, right, is my first reaction. Like, I, it'd be easier if I didn't like notion. We really like notion, right? It's like, we think they're great. Like, Ivan actually DM me on Twitter letting me know it was coming beforehand, you know, as in like, hey, like, it's like, it's really cool, you know, he's like, we respect you. I hope this leads to us pushing each other to build better products for people. So like, I, I like them. What it means for, I mean, I think the world changed overnight with AI and were like, two. percent of the way they're figuring out like what does that mean in terms of products and tools and there's just a ton to build right i feel like

transcription from the beginning has always been a commodity right everything is going to have transcription so i think the question is how do you go from what we have today to like a true AI assistant that kind of understands you yeah and helps you like be a thought partner and do most of the work you wanted to yeah what was the it feels like there's like three different like approaches to building a new AI enabled note-taking app or something like that in this world. It's like a greenfield project with startup that has a fresh, clean slate like you guys. There's Notion, which is like a well-funded, scaled company, but still in founder mode, can still like, we saw this with like Figma, roll a bunch of new features in, move still pretty agilely compete.

And then there's the hyperscalers, which are just like, we have a monopoly and yeah, it might take us 10 years to add this feature, but you're probably still going to be using an iPhone. So, yeah, expect Apple Notes to get an update in 20, 35 or something like that. But I'm interested in know kind of like, do you see the market that way? And how are you thinking about the broader competition? Because I imagine that if you just look at the overall, like, people taking notes, Apple Notes is probably still the number one product or something like that or Notepad. And so maybe that's the real opportunity and you and Notion can both win.

Yeah, I think it's an interesting question. Okay, so one angle is like, I think we underestimate. You remember when mobile came out and everyone tried to pour websites to mobile to the iPhone? And like, it took us a little while to figure out that that doesn't work and that mobile apps should look really different. Yeah. The jump from mobile to, except from web to mobile, is a fraction of the jump of like pre-AI to post-AI. So I really think the future is going to look very different. I think, and in a very different future,

I think the products that are kind of like invented in that new medium tend to do better. You know, it doesn't mean like the massive companies won't be able to add really cool AI features. But if you think about the AI features you use on a daily basis, how many of them were launched by startups, you know, that came out in the last two years versus how many of them were launched by big companies? Like, it's like an interesting assessment to do. So, like, the way I see it is like, it has a ton of opportunity. I really think, like, when Sam and I started Granola, it wasn't a, our vision was never

meeting notes. Our vision was to be, like, a tool for thought that is contextually aware and AI powered. Like, from the, you know, you can see the stuff that we wrote before launch. And meeting notes just turned out to be a frickin' awesome wedge. Like, we thought it would be a good wedge. turned out it's an amazing wedge way better than we thought because there's like so much information in in our conversations that we don't is there also like a viral loop there where people are sharing their notes with each other onboarding i imagine yeah i mean it's like basically the granola product

is nothing like there's no growth stuff built in like until today there's it was like single player product oh really it's something really yeah yeah there's something super inherent about the information and meetings and wanting to share that right so it's it's all been like word of mouth until now yeah i think but i imagine i if i take notes in a meeting I could share a static link and we're not multiplayer in that, but I could share my notes. And then I'm seeing granola.com. That's true. Yeah, yeah.

You can't share a link. And now you can even put a bunch of meetings together in a folder. You can share a folder and someone who doesn't have granola can now see those and, you know, if they log in and then. granola. Yeah. Sorry, I got the domain written. Do you have a, I'm curious, do you have a strong thesis around agents?

You know, I can imagine at some point companies have agents that are calling people and companies want to kind of understand the context of those conversations and what what happened what what kind of next steps need to take place is that something that would live in granola or is that more at the CRM level what what what what's your theory there oh man i i mean i i think the mentioned CRM i think the product categories that we've had for the last 20 years whether it's like okay you have like a wiki company you have a CRM you have like your docs company or except i think those are all going to get redrawn Because I think in an AI world, it's it's all about context, right? And then how do you make use of that context to do work?

So yeah, if you have agents calling people, I don't think that's very different from other folks on your team calling people. And then how do you make that context useful? I think that could live in Gunola. I also think agents are just one of those terms. I think we throw it around now, but we don't real. There's probably like 15 different things that today we are calling agents that are going to be their own separate things in the future. and it'll be really interesting to see how that evolves. So I got a real-time follow-up question from our mutual friend Michael at Lightspeed

who is in the new round. But he asked, is there an opportunity around agents to take action based on meeting notes, right? Because in a beautiful world, humans get together, they have a conversation, you figure out next steps, and then things immediately start to happen autonomously. 100% like 100 like that that's the whole future of granola is basically like how do we use this context for meeting notes but also in the future email slack you know google docs whatever to help you do work and like our vision for granola is like AI should do all the busy work for you right and you should only be left with the judgment so you can imagine a world you come out of a few meetings it's already

kind of done all the the post meeting work or suggestions and all you have to do is kind of be like a little bit more this way or yeah that looks good yep yep yep yep yep yep do that and then move on to your next thing. What's the use of the funds? 43 million big series B. Is LLM inference a material cost to your business right now? Is it just hiring more engineers, product people, doesn't seem like you're going to be training foundation models if you're moving to model agnostic. But what's the use of funds look like over the next 12 to 18 months? Yeah. I mean, like I said, I think there's a, like in this pivotal moment in history to build the future tooling of work. And it's a big vision and we need to hire the best people in the world

to go out and build. And there's just a ton to build. So that's the primary use. LLM inference is, it costs money. Transcription actually costs more. So we transcribe millions of minutes, millions of minutes a day right now. So that actually does cost some money. But people also pay for granola. So like that, the funds are really like, can we go after this massive vision? That makes a ton of sense. And what's, what's the, dispersion of the team going to look like over the next couple years? I know you're in London now. You are an American though. Yeah. What does it look like? Yeah. I mean, I think we, so when we launched Ganoa, we were four people, we're 18 people now. We're still tiny, right?

But we got a great group of people here. So we're definitely going to grow the team in London, because I think there's a lot of talent. But our ambitions are global, right? So we're definitely going to be opening up more offices, probably in the U.S., probably multiple in the U.S., but all of that TBD. Awesome. Very cool. Thank you so much for coming on the milestone. Congratulations.

You love to see Nat Friedman making some money. Sise Lord. We love that. That's all right. He does all right. Yeah, he's great. Thank you so much, guys. Yeah, we'll talk to you soon.

Have a good one. Quickly, let me tell you about public.com investing for those who take it seriously. They got multi-asset investing, industry leading yields, trusted by millions. And they have a massive news dropping today. Now you can, you can vote. vibe code your own portfolio. Basically vibe coding indexes. Yeah, yeah, you can go and type in,

I want to create a synthetic index fund around founder mode CEOs, or I want to find CEOs that have been tenured for more than 20 years, people that have been quoted in their transcripts referencing Warren Buffett, and it'll just pull it together, make it for you, and you can invest in it. Very cool. Yeah, so you can do my personal favorite CEOs who don't believe in meetings. Oh, okay. That's cool. But even better CEOs that deadlift. Oh, is that real? Building, you can just go build an index based on

I love it. Guys that are very into Olympic weightlifting. Fantastic. Well, we have Josh Browder in the studio. He's a CEO. We'll ask him, does he deadlift? We got to know because he's going to the portfolio. Welcome to the stream, Josh. Josh, it's great to have you on. It's been too long. How you doing? Thanks for having me. I love the show. And I love Wander as well. I see that one yes you're you're you're you're one of the first investors right we did an order I'm proud to be the first investor the first investor found your happy place you have first spot on the cap table that's fantastic so yeah give us a little bit of an introduction and do you call yourself

a CEO or a venture capitalist at this point you you're on fund for so moving more into the vc world what what's the story so definitely a founder at heart I'm the founder of do not pay which helps consumers fight companies and governments. The very first use case was parking tickets. But today I'm announcing my fund that I do on the side called Browder Capital Fund for. I'm very lucky we've raised $30 million from a lot of the best investors. And I specialize in backing undiscovered, uncredentialed founders. So we're living in a world now where there's like these crazy seed valuations are like 50. Everyone going to like one company, gravitating towards like chasing hype, I'm the exact opposite. I back more teal fellows than any

other investor or fund and I really try and create my own hype and almost incubate them. Obviously, it's up to the entrepreneur to build their business, but I put them on the right circuit. And the very first company I did this with was I was the angel investor in a company called owner.com. I'm in the pre-seed and it's now, yesterday they announced their billion dollar. Congratulations. How are you thinking about this? How are you thinking about the fund sizing? I feel like most funds, when they get to fund four, they're thinking $3 billion.

But you've kind of kept it small. What are the advantages of that? So I was lucky. So it took about three weeks to race. And I've got some raises in my career. And this was a very smooth process. And I deliberately kept it small and disciplined. I was lucky I had a lot more demand.

I want to do a good job for people. I want to do a good job for the founders I back and my LPs and I think smaller fund sizes far outperform larger ones. In terms of what I'm backing now, I actually have a founder like living with me that I don't know too well. I invited him into my home. Another founder I put his visa on my credit card personally. Third founder, I co-signed for the apartment lease. So it's really just about putting people on the right track and being their first believer. That's amazing.

What overall trends are you excited about or staying away from what's your take on defense tech? The application layer in AI, you've kind of built the perfect company to benefit from foundation models. Didn't have to train anything, but I'm sure do not pay as benefiting from AI and agents and reasoning models. But what are the trends that you're most excited about right now? So I'm founder first. So wherever the top founders are going, I go. For example, a recent company that I was the first believer in with Corey is called Pilgrim. I think he was on your show a few weeks ago.

They raised an amazing round, I think, from Cantos and others, which is a top defense investor. Also excited about AI. I'm an investor in a company called Assured, which helps insurance companies process their claims, and they've received huge traction in the market. I think every company will be an AI company, though. So I try and stay away from like founders who are like too smooth with their pitching. The AI first, I think about this, we do not pay. We've added AI to our business and really every company should do that.

So kind of these AI first pitches where the founders are saying all this jargon, like we're building LLM operability dev tools. What does that even mean? So I like to focus on like real problems and real solutions. Yeah. I think we actually met Jake Adler of Pilgrim together. when we were camping a year or two ago. I don't know if that's the first time you met him,

but that was the first time I met, I think both of you in person. There's the first time I met him in person, but this is more in the COVID era, so I was like doing my program over Zoom, but I really enjoyed playing Mafia with you guys. I think you can. Oh, yeah.

You learn a lot. A lot of good sounder or investor by how good they are at Mafia. Yeah, a lot of bluffing. It's fun. I mean, on the topic of like, I mean, I love Jake, I love Pilgrim, I don't feel comfortable, due diligence in a company like that because it's so out of my wheelhouse in the biotech space.

Is that one of the benefits of being early stage and founder led is that you can kind of just bet on the founder and you're not, you don't need to do all the technical due diligence or do you like to dig in on that stuff and just get up to speed? I, I don't get into trouble by revealing any like specific numbers. But of my biggest kind of wins, they've been sub-finding. five or even around two average. And so that kind of risk is baited into the valuation entry price. Sure, sure. I've seen, I've been operator for 10 years now. I've seen things come and go.

And if you have a founder who truly it's their life's work and they're technical, they have some sort of good success. And so they just have to keep at it and stay in the game and not run out of money and then they become really big. How long do founders stay under the radar today, right? And if you can invest in a founder at five posts, right? They're typically, you're either friends with them, you can add a tremendous amount of value or they're flying under the radar in some form of another. And then at a certain point, they become kind of discovered broadly and they start getting, you know, these rounds start getting bit up. It feels like with the internet today, even X, you know, a kid can drop out of college in a media. get, you know, three term sheets in a week. Especially if they can go viral, which is like a common thing that we're seeing now with X is that some founder does some sort of stunt, gets a ton of attention. And then there's a question about whether they can build a product,

but it certainly drives venture capital interest. But yeah, I'm interested to hear your take on that. So I think we're seeing a rise of like super credentialism. Now these top VC firms are even tracking math competitions in high school. And you have these founders, they tell the perfect story. They're like, I won Intel, I won math, I went to MIT, I dropped out of MIT, I worked to Open AI, and now I'm starting a company. Those ones are super chase. Everyone's chasing them. There's lots of competition. But for me, I really think it's about creating one's own winners. And so the best entrepreneurs I back, they didn't have those credentials coming in.

And maybe they needed to be put more on the right track in terms of what they were working on. and a lot of sometimes investors even passed on them. And so I'm really, I'm not saying the math competition winners make bad founders. Obviously there's some huge wins with that. But just because someone's good at math doesn't mean that they make a good founder. And there's like more innate qualities that other people aren't signaling on. How do you think about kind of the geopolitics of entrepreneurship right now? we're in kind of this this odd realignment towards America.

There's some VC funds that are pushing really hard to invest in Europe. There's other folks that are great at, I mean, you said you paid for someone's visa. Clearly, that sounds like you're bringing a founder from somewhere else to America. What does the trade imbalance look like in the founder ecosystem? Is America still bringing enough talented entrepreneurs here? Is it still fertile ground for the global entrepreneurship community to come to America or Silicon Valley and build generational companies? So I'm originally from England, as you guys can probably tell from my accent, and I think that America is by far the best place to build a company. People are more ambitious here, but capital availability is like 100x.

I think a concrete example is like the most valuable private company in the UK is like Revolut, which is like a bank clone. And the most valuable private company in the US is like Open AI or SpaceX. There's like order of magnitude bigger. So I encourage any founder I back to move to the US and also to move to the San Francisco Bay Area. Unfortunately, still being in the Bay Area really matters a lot. The companies don't have to start in the Bay Area. They could start in Arizona or wherever they drop out from, but they should really move here. Pilgrim is a great example.

Jake started in Canada and then moved to the. the Bay Area. I also think there's a huge arbitrage on the 01 visa. It's known as the genius visa, but it has like over 95% approval rating depending on the year. And so you get someone the 01 visa and they're a true genius. They move to Silicon Valley and then they hit the ground running. What about advice for young people? Do you think learning to code or being able to code is still a positive signal or in the age of cursor and windscar? serve and Devon and AI tools, it's becoming less relevant. I think the biggest thing is distribution and being an online fuss and having these

skills of like distributing your product. Coding and being technical is important, but it's just one skill. Like I backed the WOP founders, WHOP as an early check. And they were like really deep in like sneaker bot communities and things like that. Because everyone is starting a company now and you need to break out. I feel like a lot of Stanford students are just starting company. just for the resume. There are so you there's so much noise and you have to kind of weigh through that. Yeah, the WOP founders are definitely doing it for the love of the game. I mean,

they're killers. It's amazing. What a great company. Can you give us, I know it's not why you're on the show today, but can you give us the update on on do not pay? It seems like in so many ways the company was incredibly well positioned to benefit from improvements at the model layer. give us the update there. Yeah, so Do Not Pay is an incredibly efficient business. It's a very small team. It's only 14 people and seven of those are like expensive employees and seven contractors. And when I start to Do Not Pay, it was really about templates to get people out parking tickets.

And admittedly now, ChatGPT can write you a template letter. But AI has improved our product by 5 to 10x. So instead of helping people with parking tickets now, we have AI agents. they log into someone's Comcast account and start negotiating with Comcast to get people's bills down. And the big companies have AI and we have AI and it's like AI versus AI warfare. But we're more motivated than the Comcasts of the world. And so we're winning like thousands of these negotiations a week. And I think it's a good lesson that I tell all the people I back is like you can't rest on your laurels.

You constantly have to be innovating, change the product and adapt with the times. Yep. It makes a lot of sense. Fantastic. Well, thank you so much for coming on the show. We appreciate you. Good luck with the new fund. I feel like my only concern for Fund 4 is that some of these bigger multi-stage funds are going to sort of pay a private investigator to follow you around and just sort of like see who you're meeting with, you know, ahead of time and be like, oh, Josh is trying to do another.

The preempts. He's trying to do another, you know, 500K on 5 mil. Why don't we offer them 5 on 25? Has that actually been a problem for you at all? Have you, are the like the bigger funds, the crazier dynamics? Is that is that a trend that early stage VC should actually be worried about? No, I think Josh's playbook is he meets, just way before.

Bys 10% before anybody knows about it and says, hey, you know, you guys, you know, take them on a road ship. They're not ready for the big funds. They need about a month to kind of get that stuff like that. Yeah, that makes sense. So it's not strictly, like they wouldn't be sniped even if they could be found because they're just not, there's not in a place to do those types of rounds. That's interesting. Makes a lot of sense. Well, thank you so much for joining. Love it. This is fantastic conversation. Josh and yeah, congratulations on the new fund. Thank you. Thank you. See you guys soon. Bye-bye. We'll talk to you soon. Well, that's a great cue to talk about linear. Linear is a purpose-built tool for planning and building products. Meet the system for modern software development, streamline issues, projects and product and roadmaps. Jordy's been using it for the past 35 years.

He loves it. I wish. It's fantastic. Planned his home. Years before I, you know, was in the womb, I was running on linear. No, you know a funny little anecdote? Linear is sending us some merch. Oh, yeah?

And the automated email to notify us that they were sending us merch that's not even available online was like perfectly designed. No way. That's crazy. Like it was truly incredible. I'm like, okay. Yeah, culture of design. Yeah, every single touchpoint matters.

We should also talk about numeral. Numeralhq.com. Sales tax on autopilot, spend less than five minutes per month on sales tax compliance. It's sales tax, J.I, John. It is. We got to get, we got to get blueprint on Numeril. Yeah. We should just spend this entire pitching him.

What are you doing for sales tax? What if he's just like I'm already on Numeral? It's possible. It's a highly efficient business. I'm excited to talk to him about it. Benchmark Series A. Anything else you're tracking on polymarket these days? I saw.

I'm still obsessed with the world's largest tech company. Nvidia is surging right at the same market cap as Apple, but Nvidia has the momentum. Yeah, largest company end of May, the gap has been closed, John. Oh, yeah? So, Nvidia is at 42%. Microsoft is at 50%.

and Nvidia has a lot of momentum. Oh yeah. Nvidia's 42% now. Wow, they really are ripping today. They were at 20-something just yesterday. Good to be Jensen. Good to be Jensen.

I was posting this that if Nvidia does it, if they pull it off and they're the biggest company, they're going to have to teach Jevin's paradox. It's a $60 billion gap. Wait, really? He can do it. He can do it. It's a horse race.

more, he needs to, you need one more. One more deal with a, with a global. You know, he's been on the conference circuit, but it's working. Like, he seems to be at a new conference every single week, but, uh, clearly he's getting business done at these events and he's striking deals. And I'm sure it's like, you know, he meets someone super important, like the head of a country and then says, my people will talk to your people and we'll get and we'll ship you a hundred thousand GPUs.

Yeah, he definitely has envelopes or not, not, not, he has napkins. with fully fleshed out contracts on them. You know, they just... Just how many zeros do you want behind the one of the number of GPUs you're ordering? Yeah. Of hoppers. Fantastic.

I don't know if Brian's here yet. Let's check on him. And, yeah, maybe we can do some timeline while we wait for him. We got some posts. We can talk about mischief. Collabbed with Mercedes. This is a fantastic looking collab.

They created a trash can with pedals. Seeing this almost made me angry because I want every piece. Yeah, you were like, you were like, oh, like, what did they do? This is so frustrating. Yeah, you thought something was wrong. Yeah, like did they do they do they do something that we were thinking about doing or something? No.

No. Completely original. Beautiful. Beautiful. You can kind of scroll through these. And I guess they're going to be selling. There's an AMG coat hanger. That looks like a fantastic coat hanger to hang your jacket on.

The couch is just insane. awesome. We got Brian. We got Brian in the studio. Welcome to the stream, Brian. How are you doing? Hey, guys. How's it going?

It's great. It's great to have you on the show finally. How'd you sleep last night? Yeah, really well. Actually, no, that's not true. Oh, no? No, I just started a new sauna protocol. Okay.

And it was 200 degrees Fahrenheit. 200 degrees. Wait, what's the sauna that we do? Isn't it like 130 or something? That's crazy. Yeah, I mean, I can get my sauna. So. So I've been nerding out about sonnas for a decade now.

And currently my sauna can get up to like 165 and then it'll trip like a heat limit. I'm not even able to get to that range yet. You're in the minor leagues. Yeah, it's in the minor leagues. Okay, so 200 degrees. What else is special about the new sauna routine? Yes, I found, I read this yesterday. Let's see here.

So a, yeah, at 200 degrees, it takes about 20 to 30 minutes to bake an egg until the white is set and the yolk is still soft. So yeah. It's hot. I've done seven days now and my sleep has been disrupted. So I'm still getting, I'm still getting good sleep scores. I'm my total time in bed, but my nervous system is is pretty high. So sure. Yeah. So I'm going to this. Wait, so what do you have to, are you wearing gloves? Are you wearing like any type of protection on your head at 200 degrees? What do you need to actually make it not, you know, your hair to fall out. Yeah, exactly.

So today's day eight. I think I have the system sorted. So I sit on this ice pack. And then I have another one that I put inside my shorts to cool the testes because it does lower sperm quality. Sure. So make sure the balls need to be cooled. And then I have another ice pack laid over my head because it can make hair brittle and

cause scalpel irritation. So those seem to be adequate. People used to never, people used to never believe me when I saw. I got an ice pack on Amazon specifically for use in the sauna that is like more like a cup. They stopped. They discontinued them. I think it was just me and Brian buying them on there. The special cup ice packs.

So where did this idea come from? Is there new research or did you just discover old research? I mean, I imagine that you want to know that there's some sort of data out there about the effects of this. Or are you just coming up with this idea on your own? Yeah. I mean, our process has been we've rolled through all the scientific literature and said what things have the very best evidence to improve health span, lifespan, and then we've

just gone systematically down the list. And so sauna's always been a target of ours, but most of the data in sauna is observational, which is a lower grade of quality data than interventional, where you say if we're going to do this thing and it's going to solve, you know, whether you're going to see where that has an effect or not.

And so we just finished up with hyperbaric oxygen therapy, and now we're pointed at sauna. So we completed about 40 measurements for sauna baseline, and now we're testing, like even seven days in, I'll tell you, I just did this analysis this morning. My, I had a five, six percent drop in my central blood pressure, which is, that's an improvement, a 21% improvement in my central pulse pressure,

50% improvement in my augmentation pressure, and 25% improvement in my augmentation index. So we're looking at all these vascular age markers. So even seven days into sauna, it looks like it's having, you know, some meaningful effects in my vascular health. How are you thinking about the potential of hyperbaric oxygen chambers? It feels like the next frontier, the people that have a cold plunge and a sauna at home are probably thinking about adding one.

You've used them quite frequently. But is that the next trend that you're expecting to see broadly on the hardware side? Yeah, the hyperbaric was the best therapy I've ever done. Wow. And so we've tried so many things. what was unique about it, its whole body health improvement. So it improved my brain and my gut and skin and inflammation markers and like protein markers that the cause Alzheimer's were down, trying to think others.

Is there an equivalent to like altitude that you're at or are you just like in the stratosphere? Or is it like you're in, you're in Los Angeles but you're effectively in Denver or is it more like K2 or Everest or is it like space? Exactly. So what happens is it's a hard shell chamber and then you pressurize to two atmospheres, which is the equivalent of about 33 feet underwater. Underwater. So it's, yeah, it's pressurized.

And then you breathe in 100% oxygen. So when you breathe in oxygen, the atmosphere is about 21%. So you're getting oxygen through your body. But at this high concentration plus the the pressurization, you basically flush your entire body with this 100% oxygen. So it pushes it via the plasma. So it gets it out to all the extremities. And that has an effect of growing new blood vessels of getting oxygen to parts of your body,

which you just don't get at. So it's that 90 minute exposure to oxygenation to the entire body, which has this whole body effect. It seems like a lot of the interventions that you do kind of have, there's some that have power a lot outcomes, like sleep, diet, exercise, and then there's some that are more on the long tail. how have you thought about as just being like a science communicator relaying the relative importance of these? Because some of these seem like they're extremely expensive for a minor gain, but it's worth it for you because you're running the experiment and this is your life.

But for other people, it might be a distraction to say, oh, I just need a hyperdoric chamber and then I don't, and then I can eat McDonald's. Yeah, exactly. I mean, I think the big change for me was in the past few months, I've been able to figure out how to compress everything I've learned into one biomarker. And I just didn't think that would be possible because before, if you talk about health, it depends on what era of guru you're in. You know, sometimes it's like NR or Resveratrol or Cold Plunge or Sana or like take your given, you know,

a celery juice or whatever. And the marker, I think that is actually durable over time is resting heart rate before bed. And so the reason why this is so good is it basically is if you show me, your resting heart rate, I'll see your soul. It's an accounting of your life decisions. And so the thinking is this, that, like, so tonight when you go to bed, if you lay your head on the pillow, and if you have a wearable, just take a few deep breaths and then look out your resting heart rate.

If you don't have a wearable, just take your pulse, you know, do it for six seconds, times it by 10. Let's say your resting heart rate is 60 beats per minute. Your singular goal now is to drive that down. And so over the next week or two weeks, you want to have that be 55. beats per minute instead of 60. And when you see that happen, your sleep is going to be improved. And when your sleep is improved, you're more likely to exercise. When you exercise, you're more likely to eat well. When you eat well, you're more likely to. So it creates this really positive

domino effect. And the other thing it does is that it's a check against behaviors that drive your resting heart rate up at night. So a lot of our worst behaviors are between like 5 p.m. And midnight. We're tired. We're stressed. We want to just be left alone because it just all feels too much. And oftentimes food can be a soothing mechanism or other things, a drink. So activities in that late night, even though they seem soothing to us, they drive up our resting heart rate. And that necessarily reduces your sleep quality, which then reduces your likelihood to exercise. So I basically, I now work with all kinds of people helping them understand which things increase heart rate and which things decrease heart rate. But once you

build your life around that, it solves all the fundamental problems with help that you wanted a basic layer. And then once you get that solved, you can then, of course, ladder up and do other stuff. But really, that's it. Like, that is the marker that you can peg all your electricity on. It's a really great starting point. What ingredient are you worried that we'll, that we're consuming a lot of, uh, the sort of maybe broader biohacker community is consuming a lot of today that in 15 or 20 years from now we'll discover is, is actually, uh, terrible for us. Because we've done that, we've done that a bunch of a bunch of times. Fat and carbs and sugar. But is there anything that comes to mind that you're

kind of wary of that you're maybe not 100% convicted on yet, but you're starting to spend more time thinking about. I'll tell you, we got pretty surprised. I was taking rapamycin. This is considered by many in the longevity field as, you know, a very promising drug. And I mean, anti-aging scientists disagree on almost everything. But there was probably more more consensus around reprimicin around than anything else out there. And I was taking it for several years. We meticulously tracked my blood levels to make sure we were on a good dose. But we stopped last year because the side effects were too significant, like lipids were being messed up. My blood glucose had some alterations. I had soft tissue infections. And then a month after we stopped, a paper came out

that showed that 16 epigenetic clocks showed that actually accelerated age. So this is not the end-all B-all to say rapamycin is toast. This is just to say that it's not like a slam dunk easy one. It's complicated. And so we stopped, I stopped taking that drug. But I guess like it's a good example to your point of we, I think we're in the very early stages of truly understanding anti-aging and biology and certain interventions. I think we're good on sleep and exercise and eating nutritious food, but even then that branches

out into some complexity. But I'd say rapamycin is probably, to your point, a really surprising. outcome for where an emergent consensus has been, and now we're not doing it anymore. And so there's a few other drugs we've been looking at. We have a similar path we're looking at right now, but that's probably one of the bigger ones that I would identify. Do you think anti-aging will be solved in some form via pharma or a collection of lifestyle decisions, right?

Because in many ways, lifestyle decisions today allow you to have a longer health span, lifespan. But in some ways, you know, we had the founder of New Limiton on the show last week, which is working on longevity in many ways. It feels like if we can all just extend our lives long enough to get the, you know, the sort of pending miracle drug that, you know, adds whatever, another 100 years, 50 years, whatever that number ends up being. But I'm curious how you look at it. Yeah. I think we need much more robust interventions. the type that Brian's working on with New Limit. Did you guys have Brian on?

Yeah. Yeah. Yeah. I love what he's building. I'm an investor there. I think that that's a very promising path. And what a lot of people, I think, don't understand with what I'm trying to do is I'm not suggesting that one can jump past 120 or find a path to not die by going to sleep and exercising

and eating well. I'm suggesting that this is the most disruptive moment in the history of the human. race, we're giving birth to superintelligence. It's going to transform society in ways we can't understand. And in this approaching an event horizon, I'm suggesting literally the only thing we know is that none of us want to die in this very moment. And so I'm really trying to give birth to a new ideology, a new way to understand ourselves as a species. And, but, you know, ideology and philosophy is very hard for people to engage with. So I speak with about things that people understand, like going to vet on time and not eating junk food and not basically doing things to slowly kill yourself.

That in a few years time, I think we'll look back at this moment and we'll say that was insanity before the early, before the late 2020s, humans used to do things that was some form of slow suicide. Can you believe that? That is just incomprehensible. So really, I guess I'm trying to get out this from a philosophical, ideological, spiritual, cultural, cultural, perspective by the practices I'm doing now, but I'm grateful that people like Brian are working on the more robust interventions that actually will meaningfully change how we age. Are you worried there's not enough companies like New Limit, you know, taking on this monumental task?

It feels like, you know, at least within the tech community, there's a bunch of ways, you know, there's a million easier ways to make, you know, $100 million dollars than longevity. Yeah. And that automatically, you know, people self-select out of that path. Yeah, exactly. Yeah, I'm not surprised at all. And my diagnosis of the situation would be that currently the strongest incentives are pointed at the accumulation of wealth, power, and status. If you look at our day and say, how much effort do we put behind those things?

And we do that because when death is inevitable, we've chosen a yolo game of, we're going for epicness, right, of achievement or of being remembered for a given accomplishment or of status and power in society. And we just haven't crossed over that threshold yet where people really believe that we can begin to dramatically extend our lifespans. And so if AI progresses to a certain point where it even opens the window or a longevity intervention makes a breakthrough where it's like, huh, is this moment really different? Like, you know, people look at the health and wellness stuff. They're kind of like, I don't really care. Like, if I lose an extra 10 or 15 years off my life, whatever, I don't want to live those years anyways. I'd rather have this preferred life now.

So I think it's just, we're just really caught in a cultural moment between the death being inevitable and don't die. And it's happening right now. We're starting to cross over. But I think there will be an event or a few events in the coming years. We'll change it. And the humanity's going to snap and say, I think this might be it. Like, and I think we'll have a big cultural shift. How do you think about like this internal motivation as something that can overpower an unhealthy lifestyle? I'm thinking about Warren Buffett drinking six Coca-Cola's a day, kind of rejection of everything that we know about health and wellness. And yet he's been phenomenally successful and performant in a very stressful, important job for what, seven decades or something like that. Donald Trump's in a similar category.

It seems like there's something to the motivation and like the human will potentially, but is that just all pseudoscience in your mind? Yeah, I mean, people, they do reference Buffett a lot, right? And it's like also it's like someone's grandma who lived to be 102 who drank and smoked every day. And those examples are just not practically relatable, right? Those are genetic differences that they won the genetic lottery. And they lived despite their choices. But if most people do what they do, they would die prematurely.

I think it really comes back to the ideology that Warren Buffett played a game in life about asset accumulation. And he won the prize. I mean, he's arguably the best investor of all time. So he really played that game very well. And so the question is, if you were to basically take a Warren Buffett-like performance, so on it today, what would they do? Would they try to amass assets or they tried to amass existence? And so what I'm suggesting right now is the highest ROI investment anyone can do is to stay

alive. And that's what I'm trying to do is I'm trying to basically, I've attempted to become the healthiest person on the earth, like the, you know, with the best biomarkers to demonstrate a new game of status and accomplishment is here. And it's about health and wellness. and it's about your ability to exist. And so this will take time because it's a massive shift

in our culture, but really it's just like we've all, whether we've agreed to this explicitly or not, we've all agreed to this wealth, power, and status game, and we play it independent of whether we're aware of it.

And I'm just trying to say that that is a game, it will shift, and a new cultural emergence will arise, and don't die will be the prominent thing we'll focus on. Last question I have,

do you think people pay too much attention to scale data source like the concept of blue zones, right? Is it, should individuals be focused on, you know, highly personalized health and the approach that you're taking, which is, you know, sort of real-time experimentation, rapid testing? Because even, you know, I'm curious if you have any type of thesis here, but, you know, I think people, many people have said that, you know, Japan having this, you know, immense longevity might actually just be pension fraud. and I don't you know because people have an incentive to like that's funny people have an incentive to say like yeah

grandma's still kicking you know keep giving us the you know 10k a year or whatever I'm not making any accusations myself but um I'm 65 I can retire next year people love to read into you know oh this region they're drinking two glasses of wine so I should drink three and I'll be okay yeah yeah I mean what you're touching on is a real problem where if If somebody encounters the idea of wanting to be in good health for whatever reason, let's just say a person wants to be hot, right? They want to look good and be hot. Then the next question is, what do you do? And once you step out into the world and you say, what do I do? You're based with hundreds of different opinions and they're all in conflict

with each other. And then if you take another scenario where somebody's got something that they're dealing with, they have constant headaches, or they have sleep apnea, or they have an autoimmune disorder or take your thing, they've got a complicated situation. What do they do? And so up into this point, you've had to go about and navigate the world of experts. Now these AI tools are better than almost all the experts in helping people solve their given problem. And so the next thing to close this loop is now that we've got a source of advice that is reliable and that everybody has access to is now really a function of measurement. Is can you actually get data that then improve the AI's ability to make very precise assessments? And so,

That's what I'm working on personally is I've become the most measured person in human history. And I've seen firsthand when you have data, it's incredibly helpful to figure out what's happening. And when you don't have data, you're in the dark poking around. And so we're trying to figure out how to scale data and access. Because once you pair that with the AI, then the question of what to do becomes so simple, which again is why I believe we're at this moment of shifting dramatically, where the complexity and the friction between someone saying, I want to be healthy and knowing what to do is extremely short. Whereas now it's like so big and so complicated, it's like, honestly, not doing it.

So I think we really are like this moment is so rich and has such high potential. It hinges on data with a closed loop of AI. I think we're off to a new race. It's exciting. All right. Very exciting. Well, come back on when you have more news. Yeah.

Always welcome. This is amazing. Thank you so much for time. Yeah, good hang with you guys. Be well. Cheers. We'll talk you soon. Bye.

We got Mateo. We got Mateo coming in in the waiting room. Let me tell you about Vanta really quickly. Automate compliance, manage risk, improve trust continuously. Vantus Trust and management platform takes the manual work out of your security and compliance process and replaces it with continuous automation, whether you're pursuing your first framework or managing a complex program. One of the fastest growing vendors on RAM. Oh, really? At scale.

I have no idea. And we're excited to have Mateo from 8 Sleep today. Massive day. Congratulations. huge news. I've got to update my ad reads. I'm always talking about the Pod 4 Ultra. It's the Pod 5 today.

It's the Pod 5. Congratulations. And this is particularly huge for the podcasting industry because I've said this before, but in the high stakes world of professional sports, sleep is extremely important, but arguably a higher stakes world exists, technology podcasting.

You need to get your sleep if you're going to be podcasting three, four hours a day. And that's why we, I'll tell you be you be proud. I legitimately get angry at John when his sleep scores are down. It's terrible. It's tearing us apart. I take this game, this podcasting game very seriously.

Very seriously. And I take John's sleep very seriously. You should. Jordy's been smoking me. But yeah, give us the update. Explain to us how the launch is going. What's the overview? Break it down for us.

Yeah, of course. I mean, first of all, at eight sleep, we developed technology to improve your that that's literally what we do. And the way we do it is by focusing on controlling and personalizing all the environmental factors. We started with temperature in the cover, which is a cover that you can install on top of your mattress, it tracks everything about your sleep and health,

and then it changes temperature to give you better sleep. And then we took temperature to the next level now with Pod 5, so you also get a blanket and you can sleep in this sort of microcontractual climate and guys i know i'm biased because of the ceo of eight sleep but it's freaking cool i have been using this product for nine months and i have given it to some friends or people inside the company and they all love it doesn't matter if you like it cold or warm and so john's john's wife message john this morning when she saw the launch and she was like like just sending

exclamation points like we have to get one yeah she will do you know if she sleeps hot or cold extremely she's cold she wants it to be a blazing fire an inferno an inferno a cocoon yeah so she will love it because now she will be surrounded by temperature cold temperature everywhere it's like going in a freezer and closing the freezer and yeah and I like my side's freezing cold I'm minus 10 and she's plus 10 every night but she says you can tell him I love him for inventing this it's really like the greatest upgrade of the entire year to our house it's fantastic That's awesome. So temperature is one, right?

And we tackled that biggest factor impacting your sleep outside sleep medical disorders. There was plenty of evidence. We didn't have invent a wheel. We were just the first ones to really commercialize a consumer product. They would do something that it was already proven to work. And then we got into elevation. And so we introduced the base. The base goes underneath your mattress and it raises your head if you're snoring.

And so you will see a drop in your snoring. dropping your snoring by up to 45%. Wow. If you have problems of circulation with your legs, we raise your legs. Okay. And the most important thing that very few people know, I don't sleep flat anymore, meaning sleeping flat is from the 80s. You need to sleep in a position where you raise a little bit ahead,

a little bit of your feet. And it takes away any sort of pressure on your back. Yep. Is snoring actually bad for you or is it just annoying to whoever's sleeping next to you? Sorry, say that again? Is snoring actually something you should be worried about or something you should be trying to mitigate from like a health perspective or like a personal sleep quality perspective? Or is it just annoying to whoever sleeping in the bed next to you?

No, it's negative for you. It negatively impacts your sleep architecture and it can limit the amount of oxygen that gets to the brain. Because if you think the real true problem of sleep apnea, which is a form of, extreme snoring, if you will, is that when you have these episodes of snoring or sleep apapnea, less oxygen gets to the brain. And so if your sleep apapentin is very strong, the reason why you feel very tired in the morning is because you kept lacking oxygen in your brain during the whole night, and your brain cannot rest. And so meeting and snoring is very important for your own health, and it's important for your

partner so you don't bother them with your noise. Yeah. Now, the latest base also comes with the speaker now. And the speaker plays soundscapes that you can play to fall asleep, to stay asleep. And then we have this partnership with Huberman where we are introducing an SDR, so non-sleep depressed, is a sort of meditation and breeding. You can play that with the voice of Andrew. And then you just fall asleep and you sleep like a baby.

SDR, I think sales development is representative for Andrew Huberman is just there. pitching you on sleep. Like, you know, I've talked to a lot of people that are considering sleep and I think it'd be really great for you tonight. Yeah, I think there's an opportunity to do an ad-supported eight sleep. Oh, yeah. A head-supported. And we'll record ads.

And you can fall asleep to the sound of us. Just reading ads constantly. And even at 1 a.m., pst. Hey, have you heard about Ramp? Have you heard about Ramp? Exactly. I can't start playing ads for Ramp. No, I'm joking.

Well, if they already have any sleep, we don't need to do an AIDSleep. we don't need to do an eight sleep ad again. Maybe an Easter egg. Yeah, yeah. When you wake up a certain days, there is a ramp ad. By the way, my Tesla, sometimes I start, no, I go into Tesla. I use the radio very few times, but then there are ads on my Tesla when I want to use the radio. Wow.

Everything's ad-supported. You got to upgrade to the ad-free version of your car. It's a dark, we've entered in. This is the future. It's a very black mirror, but welcome. the future. It's going to be cheaper because it's going to be ad-supported. What else have you looked at in the sleep world? I know that you've launched some adjacent products. I'm thinking like, you know, you're in blankets. Are we going to see pillows? Are we seeing, you know, supplements and other

clothing and pajamas and all sorts of different things? Like, how do you view the sleep market? And what have you gone after first and what do you see on the horizon? Or even, like, blackout curtains. right? Try to black out, trying to black out your room is, you know, there's solutions. Yeah,

what do you like? What have you already done and what's on the roadmap? Yeah. So if we go back and not to the beginning, right, we use AI and technology to improve your sleep. So anything that can improve your sleep

is something we are going to do sooner or later. Cool. Where there is technology is the top priority. There could be other products that maybe they don't have embedded technology, but that we develop based on our data because we are becoming one of the largest lip-lots in the world. So supplements, we launch a first line of supplements that we develop with Peter Atia.

And the reason is we have all these data. We know what works, what doesn't work. Sometimes you read people saying, oh, should I take melatonin? Should I take magnesium? We have run clinical studies. But from a technological standpoint, I would say the two coolest buckets to me are, one is environmental control and the second is body scanning. And I'll tell you about both.

So environmental control is, okay, today's temperature with the blanket and the cover, elevation and sound. Then you should imagine that, yeah, there will be more thermoregulated products, because temperature is the killer feature. But I want to control air, oxygen, light, noise, sound, sense, everything. So everything that we can optimize because the key difference between us and the wearables is wearables do a decent job at tracking stuff, but they don't do. anything for you. Our job at eight sleep is don't wear anything and we are going to do the work for you. Yeah. So this is the environment. Then doesn't matter how long you sleep. It's still a lot of time.

And so the goal here is to work on body scanning technologies where we can scan your body every single night to detect if you're developing certain health conditions before you even know. Crazy. And that is part of our R&D. Have you been able to look across the anonymized sleep data? noticed any interesting trends I'm thinking right before tax day or how do people sleep before Christmas or is everyone excited anything that you can tell us about how the global sleep community trends one night or another do people sleep better during winter when it's cold or summer I don't even know have you learned anything yeah aggregated data anonymized of course yeah we have a look at

some of this stuff again as you said aggregated anonymized so Obviously, we don't know anything about an individual. But like, for example, I think the city where the town where they sleep the best is in Northern Australia. We have seen people sleeping more after COVID, meaning after COVID, the trend generally changed. We men tend to sleep longer than men. During the election day, people went to sleep like a couple of hours later. Oh, wow. And then we can start tight or connect it to certain specific events, right?

and sport like Super Bowl, all that kind of thing, which is pretty cool. Or you see it if there are bad days in New York and there's no day in New York, all that kind of thing. And it's pretty interesting to see these patterns. This in terms of, I would say, consumer behavior. Then with AI, our models are reaching a point where are smarter than us and they start connecting the dots of things that we don't even medically know. Meaning, let's say that you join its sleep and let's say you share that you have certain health

conditions. Our model starts understanding that could be based on these parameters, you might have a certain likelihood to develop a certain health condition. It can go, could be completely disconnected from sleep. It could be diabetes. It could be Parkinson. It could be a neurological disease. But by correlating all these aggregated amount of data, hundreds of millions of

nights of sleep, we can predict the future of hell. I got to ask, how did the Charles LeClair partnership come together? Was that a two plus year kind of, you know? Let me start with a cool story. And then I'll tell you, but so the day we sign, so I go to Monaco for the day we sign and I'm at the hotel and we need to go to this place where we sign and then we do the first photo shoot. And so Charles comes to pick me up and he comes in a Ferrari because he drives a Ferrari.

And so I said, look, you're the best Uber driver I have at hand. By far. Yeah, being driven around Monaco by Charles is a good, good. Everybody should do it once in their life. Oh, yeah. The interesting thing is Charles about the pod two years before the partnership. We didn't even know. It's always the best.

Yeah, it's always the best. And so when we got connected two years later, he already knew about us. He loves the product. And when I pitch him our health vision, health is very important for him. And he's like an AI geek. You would never expect that.

But he reads everything about AI. So when we meet, we never talk about Formula One because I don't want to bother him, talking about work. Yeah. And we just talk about AI and health. And so when we met, we had dinner.

It was actually before the F1 GP in Miami last year. And it was a Thursday night. And before the end of the dinner, we said, look, we want to work together. We'll figure it out. I'll do some steps to, I mean, I'm sure you have a decent cost. And you will make some steps towards me because I'm a startup and I don't have money. And within a month, the deal was done. Wow.

quick. That's awesome. That's amazing. Well, yeah, I, I'm not excited if I have a bad night's sleep and I got to go podcast for, you know, four hours, but I can't imagine getting a bad night's sleep and then needing to go race around it, you know, hundreds of kilometers an hour. So it makes sense. Well, congratulations to you and the team. It's an amazing milestone. And we are, you know, stoked to be partners. to be partners. Yeah. Of course.

You guys are doing a great job, so I'm a big supporter, and thank you for everything. Thank you so much. You're the man. We'll talk to you soon. Thanks for coming on. Talk soon. Bye. Cheers.

Bye. Cheers. Fantastic. We love a big product launch on TVPN. Fantastic. So good. We also love adquick.com. Out of home advertising made easy and measurable.

Say goodbye to the headaches of out of home advertising. Say, see you later. See you later. To those headaches. Only ad quick combines technology out-of-home expertise and data to enable efficient, seamless ad buying across the globe. Simply too good. And we have... We're going into the Andresen Horowitz LP meeting.

We sent one of our producers out there, set up a Zoom room. Hopefully it looks really nice. And we have an absolutely stacked lineup of Andresen Horowitz general partners and some operating partners. and we should be able to take you on a whirlwind tour of what's going on in Andresen world, what they're investing in, what trends they're looking at and what deals they've done, because we really have a full list here finishing out with Mark Andresen. But it should be a lot of fun. Eric will be kicking it off.

He's been on the show twice. We broke the news here. Not really. He came on the show shortly after announcing that he was joining Andreessen Horowitz. And he's been a close friend of ours. years and it's always fun to talk to him about media and venture and tech and all of those things. So he'll be kicking us, kicking it off with us, breaking down how the transition's been, what it's like working at Andreessen and how he's settling in. Has he ripped any huge checks?

We're going to get to the bottom of it. So we will bring him in in just a minute. And in the meantime, why don't I tell you about Bezzle? Go to getbezzle.com. Your Bezell concierge is available to source any watch on the planet, seriously any watch. Mark Andreessen's known for wearing, what, what does, what do you wear on Rogan? He wore a, which one was it? An Omega. The watch of James Bond, the Speedmaster. The recently voted by Nico Leonard as the most iconic watch in history. He had a whole debate with all of his team. The great YouTuber about watches if you're interested in following him. And so maybe we'll see what Mark's wearing. Maybe we'll see what Eric's wearing. I don't know if we'll get into watches. We always try and spice it up,

but some people, some people want to stay on message surprisingly. They want to, they want to focus on business. But, you know, we try to throw them off. Try to throw a TJ off with some car talk. He wasn't really having it. But we'll get to him one of these days. We'll bring him back for a car segment eventually. Anyway, let's see if Eric is ready. Do we have a red, green, blue, yellow card? Let's see. Yellow. We're almost ready. So let me tell you about Wander.

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The other thing that we could talk about is four years ago, the Verge wrote of Elon Musk's Tesla bot announcement. Don't overthink it. It's a joke. It's a distraction. and an empty promise. This was the event where Elon hired a dancer to come out dressed as a robot

and is dancing around and it looked very silly. And Elon is saying, LOL, because now, of course, the Tesla robot is dancing and it's clearly very real. Somebody was saying it dances like Brian Johnson. Oh, really? Brian Johnson's got that very specific style. The interesting thing is that you have to know

that Elon likes humor. He likes telling jokes and he also knew what was capable. He could have just white label. He could have bought all of Boston Dynamics and had a dancing robot on stage. But he chose to put a human in a suit probably to troll people, I imagine. Like that had to have been, he had to have known what would happen that people would see that and be like, that's obviously a human in a suit. That looks goofy.

And so, you know, we know that you didn't do a real robot, Elon. This is a joke. So he almost, I feel like. like he was baiting the media a couple of years ago because what he was proposing, like a humanoid robot, was not impossible by the laws of physics. Elon, of course, lives by the laws of physics, and he gets to take his victory lap today, of course. Anyway, what else is interesting going on? Oh, HBO has rebranded again. Max is now HBO Max. And Derek Thompson, this is so bad. That was absolutely brutal. I mean, it was crazy. It was crazy that they went from HBO Max to Max. They

rebranded three times as max. They have three different logos. And now they're bringing back HBO Max. They're maxing. They're HBO maxing. Somebody said back then, and I think this was on point, was that HBO is such a good brand. Yeah. To drop it.

It's crazy. It was always a crazy, crazy move. But why even call it HBO max? Why not just call it HBO? Yeah, they should just call it HBO. The next move to drop the Mac. Well, that's what ESPN did recently. It was in the business section today.

ESPN prices its new service at $2999 a month. And it's called ESPN. What a concept. You know, the internet is as important as the linear TV over the air TV. And so make your OTT option just the same name. It's genius. It's so basic. Derek Thompson was saying if Max is paying a marketing company,

a million dollar annual retainer for naming strategy, this is pathetic. But if Max figured out that it can add and remove HBO from its streaming title every two years to create a bunch of free outrage publicity. I sort of respect the play. So who knows? Is it 3D chess? Are they playing 40 chess?

Who knows? Anyway, we got Eric Torrenberg from Andresen Horowitz in the studio. Welcome to the stream, Eric. Welcome to the stream. How are you doing? He's back. He's back. He's back.

He's back. And kicking off a record, has eight Andreessen Partners ever been on one podcast? I don't think so. I said Nixon went to China, Torenberg goes on TBPN. Yeah, look what happened. You open the floodgates.

It's been fantastic. How has the transition to Andreessen, Ben? We asked you when you joined what your plans were. Were you hitting the ground running or you ripping checks on day one? You're a couple weeks in the gig. I expect some sizable checks to be written, what you got for me. I feel like TBPN is my, you know, what did you get done this week? You know, at the time, it's my third week, fourth week.

And, no, it's been amazing. I mean, just the scope of the firm, almost 600 employees. I mean, I don't think people fully appreciate all the amazing things that are happening here. I've been spending a lot of time in the different deal meetings of the different funds, just getting up to speed and how we operate, meeting the broader team, starting to build out this media org. And I feel like, you know, I talk to employees at OpenAI all the time. They're like, we've got so many things cooking.

And I feel like there's a little bit of that here, too. just Ben and Mark are so entrepreneurial and that leads on to the different vertical fund leads that you're going to hear, you know, everyone's going to, you're going to chat with today. And people are going to hear from. And, yeah, it's just been incredible. Yeah. Is Andreessen the biggest venture fund ever in history now? I can't imagine there's a bigger one. I think if you count the original ships that went looking for whales, harpooning, they probably had like something like a thousand spread across maybe a few ships. Yeah, because I mean, there's like this narrative in venture generally that like Andresen's really big.

and no one's ever done it at this scale before. And like, maybe that's weird or different or good or bad or whatever. But the other way to think about it is like, think about the other major financial institutions that are huge, much bigger, sometimes an order or magnitude or two orders magnitude bigger. And are they in founder mode or are they like 200 year old behemoths? And all of a sudden, when you frame it like that, I become very bullish on the founder mode organization, even though there's obviously all these competitive dynamics and different strategies. But it is very interesting to see a new financial institution. We got this from when we were

talking to David on the show. And it was just very interesting to see that this is David Haber. Yeah. That that he came from Goldman, worked on firm-wide strategy there, told us some of the history of how Goldman had developed all these pods. I was doing a deep dive on their special situations group and how that spun up and spun out during the OA crisis. And like it's such a storied firm. but I don't think you can get there by maintaining some small size. You have to become an institution. That's exactly what you've done. And I think it works core insight, you know, softwareising the world and the

sort of the implication behind that, that the winners are going to get bigger and bigger and there's going to be more of them is just perfectly coincided with the firm going super big and you need a lot of capital to support that strategy. And it's worked out tremendously. Yeah. I mean, yesterday we were talking about this weird dynamic where you would expect the power law to apply to startup outcomes. And we've seen this from time and time again. It's very obvious. And it also just makes sense based on market dynamics, how power accrues, etc. But venture capital

funds also follow a power law. And you would imagine that also the size and scale of the firms might also follow a power law as there are increasing returns to scale. So it's been interesting to see kind of that play out. And in many ways, the power law just keeps applying no matter what lens or frame you take, there's like, there's going to be a big outcome. Anyway, Jordy, anything else you want to run through? Can you break down LPDA? Like, what are, what's actually going on today? What are we zooming into?

Break it down. The thing I'm trying to triangulate is what's the next coinage, you know? Oh, yeah. What's the next American? We got to break it here. That's the trillion dollar. That's a trillion dollar question. Or it'll drop as a big piece either in the Wall Street Journal or on a blog and

then we'll get you the same day to break it down. Yeah. Yeah, 100%. And, you know, today and tomorrow is going to be us presenting sort of, you know, one, our biggest portfolio companies or some of our best ones that you'll, you'll, you have Alex tomorrow coming on the show, Ablania from WorldCoin. But then also the different leads of, you know, Jen, who runs LP Day is coming right after this. And also just our fundraising, I believe, over $40 billion to date. But then also the heads of the different vertical funds. $40 billion.

That's huge. That's the best deserving. That's the biggest Saz Gong ever, I think. Maybe beaten out by Stargate. But other than Stargate, you know, you're up there. All in. I'll go deeper on it. But also just David George who leads our growth fund, which has done phenomenally well.

You know, Martine on the infraside, Ange who works AIAI underneath him. Dave Ulovich on the American Dynamism side. And the LP day is really just us talking to our LPs about, you know, what is the latest in terms of how we're doing, what we believe, what's happening in the market, where we think things are going, and it's really giving them kind of an inside purview. And we're going to release some of the best talks. And, of course, you're going to hear from Mark and Jason himself about where we are and where we're going. In terms of kind of like advice for founders, what is the role of an LP day in the, you know, the life cycle of a startup CEO that becomes a fun driver. I've seen sometimes where founders go to these LP days and then a couple of months later,

there's a direct investment from one of the LPs. Is that part of the dynamic or is it really just an opportunity to kind of come and share like the story of the business with the wider business and investment community? 100%. So we have a very influential LP-based. General get more into the specifics. And it's we're more diversified than your average event. So we have LPs that, you know, a lot of firms really focus on endowments.

We've got some incredible endowments as well. But we also have a lot of other partners, including a big international partners. And a lot of companies are looking for, you know, especially some of these AI companies. You know, Andre will tell you about sort of the open source AI companies that he's worked with looking for the global global partners. So, yeah, we have World Coin, et cetera. So there are a bunch of companies that have international presence. They're growing their international presence and want partnership from from big players. globally and some of them are here. And yeah, we're definitely looking to. Yeah, I mean, we saw that

yesterday with Nvidia. Jensen went to Saudi Arabia, announced some big deal. The stock popped. It might be the biggest company in the world is so back. And, you know, Jensen gets invited to these things. But if you're, you know, two years into your entrepreneurial journey, you might not get a seat at the table. But an LP day could be an opportunity to meet someone from that community, correct? Yeah, yeah. No, 100%. Ben Horwitz was also there as reported, which is why he's, uh, he's not joining TPPN today, but more we'll give you the scoop there. That's great. Or perhaps Jen, but yeah, no, there's a, there's a lot going on in terms of international

partnerships. And so expect to hear more from us on that front. Yeah. Now, I'm sure the fund is aligned on most of the strategies and kind of topics and hot takes, but there's probably a lot of internal debate as well around how these future tech trends will play out, especially the things that haven't been codified or really decided. Are there any topics that you're hearing the partnership kind of go back and forth on or debate internally, whether it's future of AI or how geopolitics plays out or anything, reindustrialization, different strategies? What is keeping the partnership excited in big partner meetings?

I'll give you a couple. So one is more of a meta topic, which is this idea of, you know, a lot of people say a lot of things about, us and how much should we engage? Should we just get on the work? Just working with founders, just, you know, driving great returns for LPs or when do we correct the record? When do we step in versus, hey, it's not, you know, it's not worth our time. You know, there's this famous, this rab beef yellow once called out M&M or maybe it was MGK.

M&M and then M&M was like, oh, man, now I got to answer this fool. I'm going to like build up his profile in responding to him. And so sometimes there's a little bit of that. You know, there's one example. Eric Newcomer who, like Ben Smith, unclear if that's a real name or not. If that's a, I don't want to dox him. Yeah, don't dox him. Don't dox him here.

Don't dox him. Yeah, we don't dox here. You know, Eric Newcomer, who is a friend of mine, is a good guy. But on his podcast, he did say or certainly apply that it was one rumor that our crypto fund has made a lot of its money betting on speculative. of things and then selling off. And that couldn't be further from the truth. You know, we are not a meme coin fund.

We hold most positions. And so that's just straight up. There was at least like one good company in that fund, right? Like, am I thinking of like Coinbase maybe? Yeah. Like the biggest potential one. Yeah. Chris Dixon got into it like the seed in the series A and series B and the series Z.

And like basically every single round. Yeah. That turned out. Okay. Carried industry. That's an example of disinfo. there's a lot of dissent from out there. And so we debate how much we should weigh in.

Of course, me coming in, I'm like, no, let's correct the record a little bit. So that's one on the highest level, how the firm operates. In terms of where things are going, you know, I'm excited that you'll have both Martin and Ange today because in AI, we have a big, and David George, we have a big debate internally around defensibility. And is it going to look like, you know, previous platforms where if it's not state, that's the moat because state can be exported. it's context. Context is the moat in that you chat with chat GPT and it gets to know you better

and that's what's going to keep you. Or is it brand? Are these things just moving so fast? You know, we hear all the time about people who are building cursor for X that brand is what keeps people going even if it's not context or they just not not as defensible as previous players. But, you know, the numbers don't lie and the user growth and the revenue growth is just astronomical. and as aggressive as we have been, we talk internally like we should be being more aggressive. We should have been more aggressive. There's winners in every category,

and it doesn't seem like they have dominant market share. That's a mistake that we've made historically is like thinking, oh, you know, opening I won this. So there's not going to be another, you know, big provider on either the model layer or the apps. And so it seems like the market is expanding where opening I continues to do phenomenally well. And also there's winners across the stack and room, for more. So how is your mindset shifted being at a platform multi-stage fund now where, you know,

historically if you were investing, maybe you could do personal checks across different, you know, stages, but ultimately you're very early stage focus. Is it, has it been enjoyable being at a, you know, such a scaled fund where you can realize like, oh, I didn't get into the series A of that company, but I want to meet the founder now and really get to know them. So we have an opportunity to be in the B or the C or the D, right? Like there's, there's really no sort of cap on when you guys can get involved and partner with the company. And that's a totally different mindset of a lot of being able to think like truly long term. Yeah. And it's a bit of both great because on the angel side or seed side, you can, it's easier to invest in people who are doing the same thing or sort of, you

know, Y-C-season, you know, God knows how many competitors, you know, companies that absolutely hate each other. I'm not going to mention names. Yeah, yeah. To get sense. And, you know, bigger multistage firms just don't have that same luxury. So you got to pick and you got to be right. And also, to your point, yeah, if you don't hit something in the A, you know, we weren't the earliest backer of Andrew, but we're the second biggest backer now because we just caught it

at the right time and just backed it all the way afterwards. So even if you don't get in at the C or the A, and I spend a lot of time with the growth team, there's big opportunity to get involved. So that's an encouraging sign and just once, like, I didn't know what I didn't know. It's kind of like, I used to live in Detroit and then I moved to San Francisco.

And I was like, why do I live in Detroit? Why did I live in Detroit? And similarly, like, just being at a place like this, I didn't quite realize what I was missing. That's great. Well, let's kick it over to Jen. I know we're running over time already. I'm sure we're going to be bumping up against stuff all day long.

But thank you so much for hopping on and kicking it off. TVPN correspondent signing off. Thank you. Always good to see Eric. Good to see you. Yeah, keep these soundboard going. Jen told us that she wants some soundboard. We'll hit it hard.

She's the operating partner at Andreas and Horwitz and is responsible for fundraising. LP day is obviously a huge day for her. So we will bring her in in a second. We'll ask her what's on the minds of the LPs today and whether or not America is back. Welcome to the stream, Jen. How are you doing? Jen, good to see you. Good to see you. There was a world where we didn't talk and I just hit the size

and over and over and over and over and over. And it's just a 10-minute segment of just us. Yeah, why don't you kick us off with how much money you've raised for Andresen so we can just get Jordy an easy layup here. All right, let's do it. By the way, for the audience, I told Jordi ahead of time. My sole intention is to have all the sound effects the entire time I'm talking here.

Let's get the national ball sound effect. Yeah, there you go. Welcome to the stream. Thank you, Jen. Welcome for the stream. Let's go. By the way, by the way, as KV said a few weeks ago, first time caller, long time, listen. But before we get into the contestant, I have to say, I have to do just a quick plug for your true early fans. You know, I know you had to do the gift guide for the Super Bowl of pronatalism, right? Yes, yes. You had to cover tariffs. You had to cover drug pricing. There's a lot happening. But before we get to the real topics, it's been a while since

you've talked about Amman property rankings. Yes. It has. It has. We're working on. Why don't you come on with us and do, why don't we do, why don't you join us for the, for the updated power ranking of Vermont properties. This is what really, this is the news that moves Silicon Valley for sure. Yeah. Yeah, we can get kind of like a goat debate going. Yeah. Anyway, by way, I've got, so I've raised over 43 billion in capital and over the course of my career.

Most of that was at least. Congratulations. But I spend all my time across all the funds. So across crypto summers, tech winters, everything in between. I'm the professional yapper to the capital behind the capitals. So the LQ's. So that's where I spend all my time. What's it like having everybody, or not everybody, but many people under the same roof.

I'm surprised you have even 10 minutes to get away today. You're probably one of the more popular people in the room. Well, it's definitely the quiet before the storm right now. So things are kicking off here shortly, but it's awesome. It is, there's a lot obviously happening in the world today. And also our LPs are busy people. Last week was Milken this week with the Saudi conference. There's a lot on everyone's minds.

We could talk about what's happening with the endowments. And, you know, people are looking for some optimism. We're probably the bright spot in their portfolio right now. And so as a part of that, it's exciting to gather everyone here. Yeah, there's a lot of like hot take and micro themes around, oh, if there's a, if Harvard goes for profit or something, that's going to flood a huge amount of endowment money out of venture capital or Yale's going to sell their stakes or something like that. But can you talk about some of the more macro themes if we zoom out the last 10 years or more? How have trends changed in

the LP base of venture capital more broadly? Yeah, well, the asset class has definitely gotten obviously a lot more sophisticated, right? It used to be a small cottage industry and the asset class has just grown alongside, of course, the outcomes. And so as a result of that, you know, the sophistication level of not only the venture capitalist, but also the expansion of LPs have commensurately changed as a part of that. So you just don't have endowments or foundations or family offices investing. That's expanded to sovereigns now who have a different type of opportunity cost of capital. And then you have big pensions now actively playing the game as well. So CalPERS, for example, very famously missed out on the last 10, 15 years of returns. And now they're making up for

for lost time as a part of that. And so traditional pools that didn't use to invest into the asset class are now wanting a seat at the table, largely again, because increasingly the percentage of GDP that's being taken over by tech has just exploded. I heard you mentioned to Eric. You know, Nvidia is about to be this monster of a company just jumped up. About to be. It's only a 60, it's only $60,000 gap between. I checked this morning, so give this. So, so Nvidia, Apple, and Microsoft independently, are bigger than the entire stock market of most of the G7 countries. So Germany, UK, France, like, it is wild. It's actually bigger. Three companies are bigger than all the G7 countries,

except obviously for the U.S. and Japan. Yeah. I mean, speaking of the international stuff. A month ago, people were buying French bombs. That was a mistake. Yeah. What is kind of the trade imbalance, the trade flow in terms of venture capital? I imagine there's a lot of money flowing internationally into American venture capital firms. but VC funds also invest in uh invest abroad and and uh internationally. Uh, is there, is there a trade imbalance there? Is there more money flowing into America than flowing out or is it kind of 50 50? Like how is that evolved? Yeah. So our I will only speak for A16. Z. So, um, 816 Z is still 90% plus in North America. Um, that being said, you know, our portfolio

companies have spent a lot of time abroad and focus on a lot of distribution as a part of that. So I heard your, your Saudi correspondent yesterday mentioned that folks in the defense in Saudi, you know, all the sudden are like, we want Anderol, we want Serronic, we want all these early stage technologies. And guess what? Every country wants to modernize their government. They want Silicon Valley tech on speed dial. And so there's a massive interest in all areas, especially in our American dynamism practice, for new technologies. And they want to repletform to the new AI age. And so we actually, at A16Z, have brought over almost close to 300 plus companies around the world, spending a lot of time in Saudi and a lot of the broader GCC. And particularly,

yeah, it's funny. I was watching the Qatari motorcade welcome Trump earlier today and like they went so hard on it. But it's that kind of classic thing where they're going to go to technology. First and foremost. And so as a part of that, that is the leading driver of wherever trade actually ultimately goes to. What is the takeaway from Saudi Arabia and what's going on with KSA and MBS? How are you thinking about Saudi Arabia more broadly these days? Yeah, so we spent a lot of time there largely, again, to help our portfolio companies with expansion. And, you know, MPS is pretty phenomenal.

Everyone's talking yesterday a lot about Trump and how the vibe is shifted, right? The America's so back, right? And I feel like that deserved a gong. I was caught sleeping. You were sleeping at the wheel. I got more here. I'll stay. I'll keep the soundboard up and just keep going.

But NBS is like an amazing leader, right? Everyone's talking about Trump. But I think the other part of this is like in the eight years since Trump's first visit, NBS was basically able to get every tech leader in the world at that conference. Right? He's absolutely crushed. And the whole. country, by the way, his people love him. They all have, if you go to the country and you see

people's cell phones, they have MBS's photo as their background on their phone. And then if you WhatsApp with people, their profile picture is MBS, which makes it obviously very confusing. But, you know, when was the last time a world leader was as beloved as he has been? And that's largely, again, because he's very conscious of the fact that the future needs to be tech first. He's got 70% of the population under 35. And that population is watching Netflix and YouTube. And so he's very conscious of the fact that he needs to modernize his country as a part of that. And he's retooling all the capital away from oil into tech as a part of that. Very cool. Well, last question. Then we got to move on. Yeah. What, what are people getting, you are one of the co-creators of a

mega fund? What do people get wrong about the, in the sort of mega fund debate? Because oftentimes the people that are debating have sub nine figures of AUM. And, you know, I just think it's like, unless you're playing, unless you're in the arena, the big ones scare me. The big ones scare them. But, but yeah, what are people getting wrong about the megaphone debate today? Yeah, it's a totally different game. And obviously, again, I'll only speak for ourselves.

Yeah. What we're playing is very different than, you know, obviously seed funds and small emerging making makers are playing. So it's very, very difficult to paint the broad paintbrush across every type of venture capital firm. But, you know, I think the premise of it still holds true. So I heard Eric mentioned this earlier. You know, Mark pioneered the term software's eating the world. And the reality is software didn't just eat it. It door dashed it. It devoured it. It asked for seconds, right? And so everyone's obviously now playing catch up as a part of it relative to this massive opportunity, but also more importantly, firms haven't scaled.

Most VC firms haven't scaled to reflect that. And so from a capital standpoint, not only have we scaled the capital, but we've also scaled the firm as a part of it. So if you look at every single team at A16Z, it's actually no bigger than the original incarnation of A16Z. So the deal teams are actually pretty small. They're no bigger than four to six people. So every vertical that you'll talk to today has a deal team focus that is much more

oriented around not only that vertical, but also making sure that the fidelity of conversation that you have is super high. Because otherwise, as you've scaled the firm, if you have too many people around a table, it ends up being like a presentation, right? And so when we think about the firm, that's the big part that we focus on. Like, have we actually not only made sure we've scaled the capital to reflect the market opportunity, but also have we also scaled the firm to reflect how we actually want to run the organization and making sure we're actually covering each vertical with that domain level expertise. That's amazing.

Thank you so much. My contribution to the megaphone debate is if you ask a series C or D founder, hey, are you happy that there's potentially hundreds of millions or billions of dollars available to you to raise in the private markets? Are they going to be like, no, I'd rather do a small cap IPO and, you know, spend years dragging it out in the public markets before. Yeah. So, anyway, I think that that should end the debate by itself.

Jen, it's fantastic having you on. The crowd loved it too. The crowd loved it too. Come back on again soon. This was great. We'll do the Amman power ranking together. Awesome. Thank you so much.

Bye. Have a great event. Yeah, it's funny. Underrated narrative is that they are this mega fund, but I was looking at who invested in Josh Browder's new fund, $30 million. It's like four Andreessen partners. Yeah. It's like Mar, Chris, like all the guys.

And he raised money from Andreessen for Do Not Pay as well. So there's been this like really stupid. Like Josh has a lot of exposure. Josh is A16D round. I think it was a series A. Wasn't it like 4% dilution round? Yeah, it was really low. Really fascinating.

But they clearly like working with him because they backed him on the fund. Yeah. And he's taken such a contrarian approach to building the company, seven full-time employees. Yep. Dividends. He was like the first company to be like, I'm profitable. You remember this?

He's a master of media. He's always on TV. Like, how'd you do that? Anyway, our next guest. runs in the family. Welcome to the stream. How are you doing? Great. Looking fantastic. What's happening? What's happening? My name is Bernas. Anjene. Friends all call me Ange. You should feel free to as well. Ange. Fantastic. Well, great to meet you. I would love to kick it off with a little bit of overview of what you're investing in today, what you're excited to be presenting at LP Day.

And then I have a bunch of questions on open source AI and the specific trends that are going on in the market right now. Sure. I have the fun job of spending the $40 billion. that Jen raises for us. Fantastic. So I'm a general partner on AI infrastructure practice, which is basically all the computing systems that people need and rely on to build great products and services on top. And I basically spend most of my time as a glorified customer support and compute intern for scientists building foundation model companies, training models, all the stuff that happens at the intersection of research. And, and then actually trying to figure out how to get that research out into the real world.

Okay. So I started at the firm two years ago. Oh, cool. Almost to the day. And I came to the firm after a couple of years as a founder. And then I found a company called Ubiquity 6, which we then sold the Discord. And I ran the platform there for a few years during the era where we went from basically being a chat app for gamers to, which was about 70 million monthly active users. to about 200 million monthly

actives basically in six months because COVID happened. Yeah. And the homework assignment was, Ange, go build a developer platform business for us. And it was around that time that I got a call from some friends who were running research at OpenEI who said, hey, Ange, we're, we've just trained this model

called GPD3, and we think we're onto this thing called scaling laws, where if we can combine compute data and algorithms in the right combination, we just might have a shot at creating God. Classic. Okay, how much do you need to get started? Sorry, are the live audience here got a little excited? A little excited about God in the box.

Well, you know, as of having just gone through the journey as a founder, I was like, okay, how much you think that's going to cost us? I mean, God should be pretty cheap in these times where religion seems to have left the room. And you're like, yeah, we think we can get by with five. And I said, okay, five million shouldn't be a problem. We can probably scrap that together next week. And this was Darya, who was a longtime friend and now founder and CEO of Anthropic said, no, I don't think you realize I meant 500 million.

I said, okay, that's going to take a little bit longer. So I was one of the early angels into Anthropic at the time that gave me sort of my crash course to scaling laws for neural language models, right? the idea being that you could get these language models to predict the next word in a sequence. And if you kept scaling up, both the amount of compute you train these things on as well as the dataset, then you'd be able to predictably improve the performance of these models. I'd call that the pre-training era. What I spent a lot of my time. And so, you know, for the better part of the last three, four years, I've basically helped teams

like Anthropic. I usually get a call from them before there's a company when they're scientists who've, who've, who get who get have this sort of moment where they realize they're there they're about they've unlocked something um repeatable where you can very predictably improve the performance of these models on some axes um and they usually give me a call and they say we've we've had the the enlightened enlightenment moment we have no idea how to commercialize that and turn that into business and so i've worked with teams like mistral which is working um on open source models uh last year I let a, the first on into a company called Black Forest Labs,

which are the creators of stable diffusion, which is the open source image model family that I think sort of introduced the world to the idea that open source language and image models can be pretty powerful. And so that's what I spend most of my days doing, helping folks, you know, get their clusters set up to train models to then build products on top. And I think at this LP day, there's sort of two big things I'm getting asked about. The first is, okay, Ange, you know, two years ago it was all about pre-trained models, like the pre-training error, AI scaling laws.

What's going on now? Why is everybody talking about post-training? Right. So that's one big question. And then the second is, hey, what is going on with sovereigns? So why are countries announcing $100 billion into data centers and why are they all talking about wanting their own AI, you know, champion company, whether that's Mistral in Europe or. but it's alarm in Saudi. And so I would say sovereign AI, which is really the idea that you want to control your own AI, you want to control what it can and can't do. And the idea that that progress in AI is not coming necessarily from pre-training, it's coming from post-training are the two big themes for this year for me.

Yeah. On the open source question, are you thinking about Mistral and Black Forest Labs as kind of like the red hat Linux model where they will be almost like implementers in the enterprise or is there a real world where you're underwriting against total and complete victory of the open source of the open source paradigm at the foundation model layer? And then related to the international topic you mentioned, like is Mistral uniquely, are you uniquely bullish on Mistral because it's an international company as opposed to an American company because it has this.

this specific advantage of being in Europe and that driving extra value for the company. Oh, no, I think, so of course, Europe is 400 million consumers. So just mass economy that's decided to gear up to build the basically the single largest infrastructure buildout. I think we've seen in the continent in like 60 years. They just passed an $800 billion defense bill. They're calling rearm Europe. And like a huge portion of that is flowing to AI and computing teams for sure. So we can talk about that.

But that wasn't, when I led the series A into Mistral two years ago, $200 million round, like Europe was, I did not expect that we'd be in the middle of like this massive sovereign AI buildout. I mean, the bet was very simple, is that if you look at the history of computing infrastructure, there's basically two frontiers. You've got the capabilities frontier and then you've got the efficiency frontier. Right. So the capabilities frontier is usually dominated by close source. If you look at databases and storage and networking and so on, you usually have a company like Cisco and so on that pioneers some new capability.

Right. And then, or actually in the case of Linux, like you said, right, you had Microsoft show up and build Windows, closed source, right? And that usually opens up the aperture for consumers, because consumers are often the first to flock to new use cases. The enterprise cares about something slightly different. They care about cheaper, faster, more control. And that's usually dominated by open source. So, you know, two years ago, when I was running the platform orgate Discord, we got early access to GPT4. And the open AI guys said, hey, we've got this new model.

It's going to come out in six months. Can you guys just figure out what it's good for? And we ran an experiment. You know, we ran a bunch of tasks through it. And it was extraordinary on a couple of them. And we said, okay, great, let's go to production. Well, it turns out when you want, when you're working with sensitive data, right? In our case, this was a social platform.

So GDPR, CCPA, all of the compliance stuff. Really critical that our data doesn't leave our servers, right? You want control over where the weights are running and what the weights can and can't do. And so we looked around for an open source alternative to GPT4, and we just couldn't find one. And that's what I realized, okay, for every dollar that you're seeing in like enterprise or large company prototyping

or proof of concept revenue, there's like 10 more waiting for the open source. alternative right and really there was no alternative until later that summer when llama showed up right llama was the first time there was a comparable open source alternative for to close source models and and well the creators of llama left and started mistral so that that made the investment easy that's great can you take me through the deal for sesame ai obviously they went viral but the founder had had a previous andreson backed company i think in oculus um how did that come together

and how is the company? Yeah, and even your first interaction with the product that blew you away, because in many ways, that their initial launch and the website, and I think you guys had already, you know, completed the investment well before that. But so many people, that moment was truly eye-opening for them, where it was like, okay, I could have mad this feels like talking to, you know, a friend. you know, it felt it felt really real. Yeah.

Yeah. Sesame is a fun story because we started that company two years ago at a time when like everybody in this space was like, look, this idea that that we're going to have a new computing interface was completely seen as like a crazy idea. There's two parts of the Sesame. One is the hardware, and we're building AI glasses over there. And the second part is the actual companion, which is the voice interface you guys have probably tried out. The voice AI, right? And when you put those together, the idea is that it's a system that has so much context about everything you're doing, about your life,

that it becomes the primary interface to computing. And, I mean, you know, two years ago, it, it, I would say a lot of people had, seen and watched like her, the movie, right? Yeah. But the, the, the, when I'd sit down and I'd describe to people that, hey, what you really need is, is this beautiful marriage of hardware and software. And that's what's going to come. That's what's going to be the primary interface after smartphones.

People would just look at you like you're crazy. And so I was like, okay, there's only two people I know who are crazy enough to believe this. one was Brendan, who had been an angel investor in my last company, ubiquity, sick. Brendan was the CEO of Oculus. A few people on Earth who had both built a hardware startup and sold it for billions of dollars. I think Oculus sold in total for north of two billion. And Ankit, who was co-founder and CTO of Ubiquity 6, which was my last company.

And Ankit was running the voice, part of the voice AI SDK and Infra at Discord. You know, about 60% of all Discord voice minutes, daily minutes, are spent in voice channels. Wow. Wow. That's when realized, people don't realize it, but for most, for many, many, many consumers, voice is actually a much more frequent interaction modality than like looking at a screen. And so the idea was if we can combine those two, we might have a shot at building whatever

comes next after smartphones. So that that was the idea, but the key like insight, I guess, or bet was that it has to feel realistic. You're not, like Siri just doesn't work. Like you just know how to completely. when you try to talk to Syria and you're like, okay, I'm talking to a robot. Yeah. But instead, if we could get the companion to cross the uncanny valley, if we could get you

to think about talking to Sesame, and we have two companions right now, one is Maya, the other's, Miles. If you could get you to think about using and talking to Maya and Miles as companions, not as robots, then that's when you'd really start using it in your daily life as an interface constantly to all the action services. used. Does that make sense? Yeah, totally. How do you, in the context of Sesame, what's been the thinking? Because obviously, sounds like you've been on the board since day one or, you know, I don't know the exact mechanics, but how has the company thought and how do you think broadly across the

portfolio around this a balance, balance between, you know, being heads down building and needing to capture the attention of, you know, the tech community, the broader, you know, potential user base. because I feel like it's this interesting dynamic right now where there's so much to build. Like in some ways, companies should just be heads down and almost be silent, right? And this is like the SSI approach is to basically say, like, we're not, you know, maybe going to release anything that we consider less than, you know, a really significant evolution. Yeah. And but Sesame kind of like popped its head up and said, hey, look at us.

Look, look what we're doing. But then now it seems like, you know, it's taking more of the. the approach of, you know, being willing to fly under the radar for, you know, call it the next, who knows how many months? I'm happy to report that it doesn't get any easier, the more money you raise. I found, like, on day one, we didn't, we hadn't raised any money, right? So we're just three guys sitting in a room and talking about ideas. And this, I would say the heuristic for most people who come from the software error is like,

hey, ship fast, ship early, ship something you're embarrassed about, right? And then iterate. And AI is a little bit different. Frontieria is a little bit different because you often need a critical, you need to have a capability threshold that is sufficiently transformative enough that people will put up with all the tons and tons of friction that there still is to use AI today. Right? So you guys may have noticed.

But when you go to the Sesame site and interact with the demo, right, it's quite fast today. One of the things we really, the team like spent a ton of time honing was the latency of voice responses. We had to make it feel like it was up 200 milliseconds. It felt like you're having a conversation, right? Two years ago, it wasn't there. It was excruciatingly slow. And we knew that nobody, people would miss the underlying personality of the model if we hadn't solved the systems problem of latency. And I find it comes down to this really delicate balance,

the overarching problem of like, hey, when do we ship? When do we actually put this out in the world versus being heads down? It comes down to this constant tussle between taste, which is who at the company has such a strong opinion that the product experience is good enough and the ruthless sort of machine learning approach of running e-valves, right? The idea that you you build a model, you test it in an environment, you benchmark it and you see how it does on that eval. And if it hasn't improved that evaluation score, you know, you keep going. And it basically, you've got to have, like, I've lost count of the number of hours we've spent debating that tension, right? And it's extremely uncomfortable for traditional software teams to do the eval-driven approach because

the list of features you can kind of deterministically write out and say, check, check, check. These are the things. we need to ship built once you've got the v0 the MVP we ship that's not how that's not how a i works right i research and post training is is eval is evils driven which is you have an intuition for what you what you need to do to improve the model but you don't actually know until you run it through the to an empirical test and so the answer comes down to how good are your evels and so if i was to boil down what's what works for the best teams it's they have great product taste but they also have great taste in evals, which is what is the right evaluation metric to build for your team? And then you basically stay heads down until you've unlocked both of those.

Does that make sense? Yeah. Yeah. Fantastic. Well, thank you so much for joining. Good luck with the rest of LP Day. Come back. Come back on again soon. Yeah, yeah. We'd love to have you back and talk. Anytime. You know where to find me. Fantastic. We'll talk soon. Bye. Cheers. Cheers. Next time we have Martin Casado, General Partner. He's on the board of Cursor, world labs, DBT labs, Kong, 5Tran, ideogram, ambient AI. This guy has a lot of board seats. Brain trust, coactive, Netlify. He leads the firm's $1.25 billion infrastructure practice.

And has built quite the AI portfolio. So we're excited to have Martin on the show, discuss open source AI, his views there, what's cursor doing. Welcome to the stream, Martin. So good to have you here. How are you doing? You're good? Thank you.

You got to welcome it with some... The live audience is really just... They're out of control. They're out of control. Anyway, thanks so much. Yeah, yeah. Thank you so much for joining us. I'd love to know your take.

Let's just jump right into it since we're running a little bit behind. Cursor, obviously, it's becoming this front-end, almost aggregation play. It's the front-end to AI coding. It's potentially model agnostic. What does that mean? What have you learned from the cursor journey around how value accrues across application layer versus foundation model layer?

Yeah. So, I mean, I think that there's two things, you know, that that led up to this cursor moment. And one of them is one of the first use cases for AI was code, right? We had like Microsoft copilot and a lot of people used it. But like and so like, you know, there's a bunch of users and their behavior. was trained by Microsoft, but the models weren't quite good yet. And in the last, you know, year we had this RL movement. And as a result, the models got way, way better. And then, of course, you just happened to have like this kind of magic timing where it, you know, it did something very similar to what a co-pilot looked like, but, you know, use this greater models. And now that they've kind of caught the wave, they're able to, you know, not only serve these amazing models, but like for every magic experience you see the the users have they've starting to like have their own smaller models

and so it's just you know very unique point in time very unique position and then of course a very unique technology way behind it going back to the foundation model layer can you talk about how you're thinking around open source in the foundation model wars has evolved uh i remember you and john ludig were talking about it last year since then we've had Lama 4, which kind of fell backwards, but then Deep Seek was a huge moment. And we just had a guest on the show yesterday who was talking about the importance of offering the world open source foundation models that they can build on because if we don't do it, our near peer adversaries might. How is your thinking evolved, if at all? And where are you seeing the most opportunity in the foundation model wars? Yeah. So it's not clear to me that the model space is significant.

different than the software space when it comes to open source. So in the software space, we've got 20 years of history of this, the close solutions tend to aggregate the value first and the quickest. And the reason is, you kind of need to make money to change people's behavior, right? And this is like, you need to have Unix before you have Linux and you need to have Oracle before you have MySQL, et cetera. And the same thing seems to me to be playing out in this AI space, which is you need to have which is, you know, of course, opening I was first and they've aggregated a ton of value and, you know, anthropic for code.

And then, you know, even if you look at the non-language models like, you know, image, you know, Mid-Jurney was first and that's closed and that's closed and 11 labs. And so it seems to me like the first movers will close source and they'll continue to close source and they'll aggregate a lot of value. But then for every first mover, there's always the opportunity to enable the masses, right? Like everybody else. And there's always a lot of value there, right? And this is kind of where these open source models come in. And what's amazing and everybody should realize is just because Deep Seekers out there hasn't changed the calculus or the growth of these other companies, right? It's been fully accretive. And so I think the only sin anybody can make in AI from an investor's standpoint is zero-sum thinking

because the reality is every time something new gets introduced, it's not at the expense of something else. It kinds of finds new territory to gain value in it. And open source is no different. So it's a very important part of an ecosystem. It's been part of the software ecosystem for a very long time. It'll continue to be. I do think that, you know, U.S. should have open source models.

And I think it's very important for like continued to go as presence and technology in that conversation. But it feels very healthy to me, both the dynamic with existing closed companies and then, you know, new companies that can be built on the open source. Yeah. Are you a fan of aggregation theory or this idea of like the front door to artificial intelligence? Cursor is kind of that for coding. And we're seeing that in other applications that are possible. popping up where the underlying model might not even matter. And where I'm going with this is that there's one world where another country wants their

own foundation model so they know that the weights are trained in a way that they want, aligned with their views on speech, for example. But there's another world where the individual countries should be thinking about how do we create the dominant consumer app that people actually use because even if we have the model, if nobody's using it because they're just opening up a certain URL and they go to another country's model, what do you think of them there? I mean, I think the story of AI has been the markets are much larger and they're growing much faster than anybody had expected. And that's just resulted in actual fragmentation. So everybody had these theories early on if you remember.

Oh, there'll only be one model. Oh, the models are not defensible. Oh, the apps are just GPT wrappers. Oh, like the apps are going to take all the value. And you know what? They're all wrong. Like everybody's been wrong. Like the only people would have been right are like, you know what? These things are massive. I mean, let's just take open. AI, which is one of the most remarkable companies and maybe forever in tech, right? But, you know, they were the first to image. Remember that with Dali? Yeah, totally. Yeah, yeah. They were the first to code with co-pilot.

They were the weights. They lost that. They were the first to video. And like, you know, SORO was amazing and remarkable, but like they're not the leaders in video. Yeah. And yet, there's still the dominant AI company on language, right? So what are the takeaways you can tank from that?

Like, in my view, it's, you know, every one of these is a massive, massive market. That's too big for one. company and so like you know opening eyes done a great job focusing on chat gpt and you could have the same discussion between the model and the app layer right and so i know i mean you're talking about aggregation theory so there's two views of the world one view of the world is like everything consolidates into one company and there's another view which is there's like a model per thing that's a behavior i'm definitely in the second one and i just you know even though we're relatively early we do have four years of experience with this and the story has just been disaggregation it really has

yeah that makes a lot sense how are you uh how do you think about revenue quality in the enterprise and an environment when, you know, the Fortune 500 sort of has a mandate to just, you know, buy AI. Some things they're going to. Yeah. So, okay, so there's a lot to this question. And I'll try to be as succinct as possible. So the first most important thing is AI today is mostly a prosumer and consumer movement. So even though the people are working in the enterprise, it's like it's an individual use and individual behavior. And it's not like a big budget buying thing. And so I would say the vast majority of the companies we work with, it's this more kind of bottoms up pro-summer thing. And so that's clearly real individual demand.

This happens in all super cycles. Like it was the same thing for the internet, right? It was the same thing for PCs. It was the same thing for like the iPhone, like the true smartphone, like Post Blackberry. It was like individuals. And so, you know, from that standpoint, like I think we're very, very comfortable. This is a real secular movement because it is individuals that driving the behavior. You know, there's a second point to all of this, which is in the early internet days, you had all sorts of funny accounting because, you know, it was quite frankly because people just didn't know how to do it. But at the time, people weren't even paying, right? So they would just kind of say everything. And of course, in these early super cycles,

you have all of that, like they don't know the difference between like GMV and take rate and, you know, run rate is not a gap thing. And so they kind of had, you know, there's clearly all these funny numbers out there. And, you know, that's just an artifact of massive, massive growth and success. And like, you know, we'll rationalize it as an industry, but for sure that's going on. But it's less about like enterprise budget moving. And it's much more about I've got this consumer phenomenon. I have no idea how to really do the accounting, you know. And so, you know, just requires from our standpoint, you know, just to kind of go through things and kind of really normalize it. Yeah, that's great. It makes sense. I mean, we could talk for another hour about this.

We'd love to have you back on the show. This is fantastic. But thank you so much for even taking the time that you did. Yeah, we had more time. This was great. No, love it. Thanks so much. It was a real pleasure. Cheers.

We'll talk to you, have fun. Cheers. Bye. Yeah, we didn't even get to Fay-Fei Lee in World Labs, the deal that he led there. I've never heard.

Spatial intelligence. I've never heard Martin, you know, I've seen his post. Yeah, of course. No. Potentially a Hall of Fame. Hall of Fame Yapper.

Can we get a soundboard for that? Hall of Fame yapper for Martin. See it again. We got David George, leaves the growth fun. Coming in next. I'm going to want Ashton Hall sound effect. I'm going to want lots of sound effects for this one. We're getting too

serious right now. We've got to take it down a notch. Everyone thinks, oh, they manage 40 billion. You've got to be serious. You've got to be on talking points. No way. Yeah, what's that? We have a fully executed lease on our new studio. Oh, let's hear it for us. Let's hear it for TVPN. Oh, thank you. And you know why that's exciting, John, is because we're going to be, we're going to be walk, we're going to be able to walk around the studio while we're live. Sitting for four hours. Sitting for four hours is brutal. Brian Johnson is shaking. his fists. Yes, thank goodness. Sitting is, you know, don't they compare

it to smoking cigarettes in terms of it's terrible for you. It's terrible for you. And we're going to be walking around, hitting the biggest gong you've ever seen that we've yet to reveal on the show. We'll be whacking that thing. You're going to be hype-mogging me, but I had an idea we can put a like a measuring tape up on the wall so that I can periodically walk over and prove that I'm sick to want to be. Yeah. Yeah. Anyway, we got David George in the studio.

to the stream, David. How are you doing? Welcome to the stream. Let's go. We're trying to keep the energy up. It's a big doubt. I love it. Great to see you. Thanks for coming on the show. Yeah, thanks for coming on. I love it. I would love for you to break down how the growth fund actually works. And Dresen's known for these specialized funds, but then I know that the growth fund cuts across all of them and you see deals all over the place. Do I have that even roughly correct? How do you think about supporting the companies in the portfolio that maybe get picked up at the earlier stage. Yeah, absolutely. Well, look, fun to be on here with you guys, a big, big fan. Yeah, I mean, you have it right. So we have seven different funds. I think if you talk to some of

our early stage folks, they're very domain focused. And that means, you know, they know the products, they know the markets, they know the technologies at a very deep level. And then the growth fund where we said is kind of across all of those. So, you know, ideally the way, it works is, you know, we can work hand in hand with them and take kind of the best of the best ideas from each of those sectors and then invest, you know, stage specific at the growth fund. And so what we do, probably half our effort and dollars historically have been follow-ons, supporting existing portfolio companies. And that's worked great. You know, there's something we talk about all the time, which is game film. And like, there's no better way to have game film than to,

you know, have my partner having done the series A and data bricks. And then, you know, we get to see it all along. You know, with that comes access, you know, relationships with the founders. All that stuff helps. But then, you know, the other half of what we do is invest in net new companies that were not, you know, previously investments in A16Z for whatever reason. And so, you know, we started started this in 2019. I had a big list when I joined. I'm like, all right, I know the six existing points. portfolio companies that I want to go try and create a, you know, a new deal in. And then I knew a bunch of the ones that I wanted to invest in outside the portfolio. And, and we've been fortunate to have some success. You know, we've invested in outside companies like Roblox and Figma and SpaceX and

Waymo, you know, and then, you know, obviously a lot of success doubling and tripling and quadrupling down with existing companies. Well, it's a great time to tell everyone that TBPN is sponsored by Figma. So thank you for the shout out. This is one head washes the other. the other moment put some dollars in your pocket put some dollars in our pocket yeah that was what didn't you do that deal in like april of 2020 or got announced back then that was that was a crazy it's great moment in history congratulations i got a lot of stories about that one man but we um so we had been courting i remember i met peter levin uh when i was like right at the tail end of figuring out whether i was going to join and and uh he's like we need a growth fund i'm like okay like i was going to

tell you that um and he's like like Like, you know, like we got to invest in this company, Figma. Like, it's crazy that we're not investors in this thing. Like, it really pisses me off. All right, well, we can go fix that. And so, you know, I joined and we courted Dylan for like, you know, a year, year and a half. And then, you know, COVID hits. We all think the world is going to melt.

We've been trying to convince Dylan to do an investment with us. And like, the world's falling apart. And he calls us. And he's like, I'll do a deal now. And I'm like, oh, God. Part of the deal. Bill and Field. Legend.

Absolute dog. This is brutal. Put you on the spot. I know. It was, but it was great. Obviously, we're thrilled to be as partners.

That one was funny because we, you know, like if you take a traditional growth investing lens and look at a company like Figma at that stage, you know, you could look at a spreadsheet and look at market reports on market. And, you know,

what you'd see is like, well, there's not that many designers. And sure the number of designers is growing, but how compelling is that going to be? And, you know, if we didn't have like depth of product and technology and market insights, we would have missed like the obvious, you know, thing, which is like it's not just a design tool. It's a tool for, you know, designers plus front-end engineers and that functionality is all merging together.

And the proportion of designers is massively growing relative to, relative to engineers. And, you know, there's even going to be business uses. And so, you know, Figma is an awesome one. It's a great example of a company where, you know, traditional lens would probably miss it for what it could be. But, you know, it's sort of a, it's one of these things we call, you know, we call model busters. It's like you do a little spreadsheet model. And it like show these numbers. And it like, it turns out like it's all wrong.

Like the market size is totally. And it could just totally exceed it. So it's a great. Can you talk about the model busters, the aperture of growth equity deal? obviously the traditional growth round is post-product market fit. Maybe you're up in the 50 million plus raised range. But we're seeing these crazy deals get done with pre-revenue, pre-product, AI companies raising hundreds of millions of dollars.

Are you putting that in the growth bucket? And are you changing the way your team thinks about deals to set yourself up for looking at those bigger but earlier stage deals? Or are you trying to think? think about how can we fit those into a venture portfolio or venture fund? Yeah, let me just talk to you about like the buckets of stuff we do. Please. And so, you know, there's a big bucket of stuff that we do, which is, you know, traditional

high flying growth equity companies. And so a bunch of the companies that I listed would fit that, you know, data bricks, Roblox. And those are like mature businesses. Like they have, you can do a DCF on them. You can do market multiples. Like you can do real, real work, but yeah. Yeah.

So that's one bucket. And I'll talk more about those. But I would say my observation from, you know, doing growth investing for the last 15 years or so is, you know, there's a bunch of instances of those that, like, end up being way bigger and better businesses than anybody would have thought. Yeah. And that shouldn't be surprising because if you just look at like the composition of the biggest and most important companies in the world, they're all tech companies. And, you know, they, you know, they're, their market caps. have sort of extended beyond anyone's idea of what they could be, both because they exceeded market size estimates and also they came up with new products.

And so there's both flavors of those when we talk about model busters. But that's one class of things that we're doing. In the AI world, there's another class of things that we're doing, which is like it slaps you in the face that it's working. These are the fastest growing companies that we've ever seen. We're investors in a bunch of the fastest growing companies of the previous generation, like whiz and Slack and deal. And if you put them on a chart with companies like, you know, cursor or 11 labs or XAI, like they get to that 100 million stage way, way, way faster than that

previous generation of company. So, you know, that's a, that's a bucket. And, you know, there's, there's not like hundreds of those yet, but I think there will be hundreds of those as, you know, the AI applications come. Because the groundwork is being laid for that. Then, you know, you asked about the sort of kind of, you know, earlier stage kind of companies that raise a lot of dough. We do do those. But, you know, we keep an extraordinarily high bar. So, you know, we're investors in, you know, companies like SSI that are working on, you know, really exciting new things with the best talent in the world. You know, that was part of our thesis and investing in character AI is backing Noam Shazir and you kind of squint and say, okay, you know, this is a person

that we can back and we know that, you know, he's going to create something special. So there's a transport. So it's pretty, he's on the paper. It's a founder bet, but you can really go risk on. Yeah. I have a question for you around kind of modeling, market sizing in this AI era. Everybody likes to say there's an opportunity for software to not just to basically get paid for end work. So instead of creating, let's say, software for accountants, you can create software that does accounting services, right? In the TAM expansion there of, you know, these end markets for, you know, that look more, maybe more like payroll spend or services spend, it starts to get really exciting because they go from, you know, hey, this is a $100 billion market to this is,

you know, could something could be a, you know, multi-trillion dollar market around labor. The question that I've been personally kind of wrestling with is if you, if software solutions are delivering services, maybe there's a short period where you can capture, you know, a huge amount of that, you know, spend. But over time that those opportunities, there will be other software providers that are, you know, competing to do that services work and won't that have like some type of deflationary effect? And overall, maybe not, maybe markets aren't getting smaller, but maybe prices can't stay as high as they are in a sort of human led, you know, service market. So what are your high level, you know, how are you thinking about market sizing given?

And I don't expect you to have like a perfect answer here because again, a lot of these companies are model breakers, as you described. The model, model busters, man. The busters. The busters. So, so yeah, I love this topic because it's the, it's the like, it's the fun one that everyone is debating right now is like, well, we can go capture labor. And without like a super deeply developed and astute strategy, like that's just not going to happen. And so, you know, if you look at like some of the biggest technology breakthroughs of all time, the way that those get priced isn't the replacement of what they're delivering. Competitive forces come in and actually like there's return on capital. There's like, you know, different competitive positioning and often that gets competed away. So my rule of thumb is when you have these major technology waves, just assume that 90% plus of the surplus is going to be on the consumer or customer side.

And that's great because you can still, like if they work, when they work, you can still create incredible businesses out of it. So, you know, if you take the previous wave of technology change, you know, what would you or I or probably any average American person pay for an iPhone? like a lot more than $1,000. 10K. Yeah, like a lot more than $100K. 100K. Like we've captured like 90% of the surplus and it still turns out that Apple has an amazing business on the back of it.

Yeah. So, you know, technology can be kind of magical in that way. In the previous cycle, if you just take iPhone and cloud computing, those things together created like 10 trillion of new market cap across internet software, mega cap tech. Now, a lot of that got captured by the large tech companies, but a ton of it went to new companies as well. And so my simple framework for AI right now is the more disruptive, the technology itself actually is, and the more potentially disruptive the business model, the more that favors the startup and the less, that favors the incumbent. So like, what was the mobile version of Salesforce.com? Salesports.com.

But if Salesforce.com, if that technology wave instead of being just, hey, access Salesforce on your mobile device, if instead it was like, hey, we have completely new workflow. We have a completely new interface, a completely new database. And oh, by the way, a totally different business model. Maybe you'd have a startup position. Yeah, that makes sense. We're talking to David Olivich next. How has, how does growth underwriting work in defense tech or hard tech or American dynamism? I imagine it's different because there's more debt. more CAPEX. It's a slightly different business, not zero marginal cost necessarily. How are you thinking about underwriting the next, the hard tech boom? This is a great question and one that we sit around and talk about all the time. So our lives are a lot easier because we have an amazing early stage American dynamism practice. And so we see a lot of things. We're on the cutting edge of the trends. We have the right networks. My simple rule on that is you can create venture scale

amazing outcomes that are even better than the software-only businesses, but they're probably going to be fewer and further between. Like, they're very, very hard to pull off. So, you know, we saw this at, you know, not quite the degree of difficulty as others, but still quite a hard one at SAMHSARA, which is one of our portfolio companies, which was one of the first companies that was sort of a modern hardware plus software public company. And they've demonstrated that they can create an incredible business out of it. Right now, the four that I always go to that I talk about that are the sort of champions that I always reference are Anderil, SpaceX, flock safety, and Waymo.

These are four of our biggest portfolio companies that we've, you know, led a bunch of rounds in and in some cases are some of the largest shareholders. In the case of Anderil, you know, it's a model buster because they have made multiple products work and they now have trust. And that's an even more defensible position than a software company could ever be in. So there's 700 billion of defense market cap for them to go get. And I think they'll go get a lot of it. And they might create new market cap too.

You know, SpaceX has, you know, one of the best competitive positions of any company of all time. I mean, it's like the British East India Company of Space. It's incredible. Yeah, I love it. They have like 20x relative market share. Like that doesn't happen anywhere. And then, you know, Flock is doing some crazy stuff. I always say it has the craziest ROI of any company we invest in because it's like we

stopped kidnappings. Like, you know, recovered lost kids. Yeah, it's crazy. You know, they solve like greater than 10% of all crime in the United States today. That's just incredible. And then, you know, Waymo is the last one, which is, you know, super exciting. Obviously there's a tremendous amount of R&D and invested capital and difficulty in building that company.

But it's a magical experience. Like I took my family from Kentucky in Waymo's this weekend, and they were like, oh, my God. They were very nervous. And they were like, okay, this is a better driver than you. That's awesome. It's super exciting. It's growing really fast. But yeah, the simple thing for me is like they can be better businesses, but they're much harder to pull off.

Yeah, that makes sense. Well, thank you so much for joining us. We're going to kick it over to the TV. This was great. I'd love to get back and talk more. Thanks, guys. Yeah. Bye.

Cheers. I don't, is there anybody that deploys more capital than. He's up there. He's on the leaderboard. He's in the conversation. It's funny. His list of investments. Yeah.

I thought they were ranked in order of significance, but they're just alphabetical order. Oh, really? And in many ways, they just get more. It's like, it starts basically at Anderol and ends at X and X.AI. Oh, X and XAI. Big, big checks. Well, we're. excited to talk to David Ullovich, general partner at Andresen on the American Dynamism Team.

We need an American. This is pretty American. But we need I'm proud to be an American or Freebird or something on the soundboard. Anyway, welcome to the stream. David, welcome. Good to have you here. Hey, how are you? We're great. I'd love to talk, just jump right into it about Army modernization. We talked to General George. We had Driscoll on as well. How optimistic are you for early stage startups? We know it's working at the growth stage, but is this time really different? We've been beating the drum of American dynamism for a couple of years. There's a lot of startups now. Is there something changing in the Army right now? Yeah, I think there is something changing and it has to change. And you hear the enthusiasm from General George, General Fenton, Secretary Driscoll. And you hear

it from everyone else you talk to who's just, you know, not just the people that you haven't spoken with, but the people that are walking up and down the halls and the people that are working in the DOD that they know for a variety of reasons, both from a, we don't have the tools we need, we're not procuring things fast enough, we're not manufacturing things fast enough to support the defense industrial based. We are attritting our systems that we thought were not attritable as quickly as we would. So there's a whole bunch of reasons. So I think people recognize there's a need for change. I think the question is, will this be the moment for change? And if you look at the change that's happening elsewhere in Washington and throughout the government, I think

you have no reason other than to be optimistic that this is going to be one of those moments. And, you know, there's going to be a lot of pushback from the primes and from people that have, you know, sort of had a delicious steak lunch every day for the last 25, 30 years. But like, this is the moment. For the early state startups, I think, I think, you know, we can talk about the early state startups, but I do think it's a moment of change. Yeah. I mean, on American dynamism, national interest investing broadly, is there a strong,

or reason why venture capital has led here because you could have seen this boom play out like biotech where companies go public much earlier. You could have seen a private equity boom where old subprimes or primes get turned around, taken private, LBOed and revitalized and re-industrialization really could have happened that way, but it doesn't feel like it is. Do I just have a narrow aperture on venture because I'm in this world or is there something structural going on? Yes to both. I think. I think it has to be venture capital first because we're to technology transformation moment, right? Whether it's being able to use AI from computer vision standpoints and just rapid changes,

that only startups can really embrace and react to and take advantage of quickly, or just the fact that they can attract the best talent. You know, like private equity firms really manage to the bottom line, so they're not going to pay top dollar for the 10x engineer the way a venture capital, or venture capital-backed startup would. So there's a bunch of reasons why it has to be a venture back company. Now, that said, I think you're going to see the private equity world quickly follow. All these small subprimes and people that contribute to the manufacturing base are going to not be able to keep up with the demand.

And I think you're going to end up getting rolled up. You're going to see people doing even venture back startups that sort of have a private equity sort of lens like what Jay Malick is doing. You're going to see these things start to come about where the private equity model is going to kind of make sense. Yep. But even those things might be ventured back just like you see Jay doing with AMCA. Yeah. A lot of people think defense when they think American dynamism, but obviously the

aperture is much broader. Can you talk about the interesting fringe of the of the circle of competence that for what you can put in the American dynamism bucket as has grown. I've seen some energy deals. There's hardware. There's all sorts of stuff. But what excites you in this kind of like next era of American dynamism? Yeah.

Look, we're going to invest in. anything that we, as we say, supports the national interest. So that defense is a big part of that. Public safety is another huge area. People don't think about. I think that, I think on the venture side, I'm probably the largest public safety investor in the country, if not the world. Energy, you know, we have this insatiable thirst for energy. So whether it's on energy generation or energy transmission or energy storage, those are all huge opportunities. You know, the battery ecosystem that we live in today is entirely dependent on China. That might be at risk down the road,

so we need to have an energy storage infrastructure in this country that's not dependent on China. That creates a whole bunch of supply chain opportunities, so everything from mining to reprocessing and production of minerals and turning those things into batteries is really important. So the aperture is wide, and then I would include everything from transportation,

logistics, education. You know, the tent is big. Raleigh, welcomes anybody that wants to build for American dynamism, but the investments tend to focus on defense, energy, space, public safety, those things. On energy, I know you're in Radiant. I'm a huge fan of Doug. What he's building is fantastic. But it is small modular reactors. I think one megawatt reactors designed to replace a traditional diesel generator. I'm kind of cautiously optimistic that we're going to see someone figure out how to just copy paste Diablo Canyon all over the country. But it feels like that might need some sort of change on the regulatory side. Are you optimistic about that being the catalyst and will that happen? Or do we just need an entrepreneur who says, you know what? I don't care about the red tape.

I'm going to go figure it out. I'm going to go copy paste Diablo Canyon 45 times. Or is that not even the right strategy? So look, we are all all three of us on this. on this pod right now have survived the greatest nuclear disaster in modern history, which is that after the Vogel 3 and after Vogel 4 reactors came online, we didn't just go build Vogel 5, 6, 7, 8, 9, take all the workers who knew how to do it, all the supply chain pieces of the cement makers and the steel manufacturers who knew how to make all the components and pieces, that we didn't just take them and stamp them out across the country. That was the biggest miss in our lifetimes, frankly, and it's very depressing.

Now, that said, from a startup standpoint, whether it's Radiant, and you are correct, it's one megawatt. I think there's only two ways to win a nuclear. You have to do it at one megawatt or the like 1 megawatt or the, you know, the gigawatt scale. And there's a bunch of reasons why I think Radiant will work and why the gigawatt scale can work. And one change on the regulatory front that I think people don't appreciate. Yes, we need reform in the NRC, and we need the regulators to be. be much more productive and positive to approving new reactors and making the fuel supply chain more readily available. But one of the things that's held up new reactor designs for so long

is that when you make a change to your application or you make a change to your design, you then have to go through this hugely laborious process of figuring out all the different statutes and regulations that your change impacts. And there's an entire army of consultants that get paid tens of millions of dollars a year to just help navigate. all of the requirements for nuclear regulatory process or fuel, how to transport fuel, all these things. With AI, you now have the ability to parse through all these regulations so that when you make a change, you can say, hey, language model,

tell me, what are the 100,000 pages of regulatory paperwork, what are the things that I need to go update in my application that are affected? So things that might have taken three months and $10 million of consultants work, now maybe just takes a few minutes of asking the GPT, hey, how do I update my application based on these changes? And that applies to the regulator as well.

The regulator can now go through the applications if they're using a language model or a GPT that's tuned for the regulatory code around whether it's fuel or a reactor or transport. They can actually say, hey, look, how do I evaluate this application? What are the things I need to watch out for? And the entire process for nuclear regulatory approval should really be condensed dramatically. And that was never possible before the AI boom.

So people don't always realize while we need nuclear power, to capture the AI opportunity. We're also going to use AI to, I think, enable the nuclear opportunity in future. That's very cool. Do you have anything? Yeah. My main question is, I'm sure this is something that you guys talk about internally, but you know, you have these categories, right? And let's call it defense, public safety. What's your kind of internal dialogue around making net new investments in something like public safety, when in many ways I imagine flock safety is like, flock safety is the flock safety of X, Y, Z, right?

You know, like people, I'm sure come to you with pitches and, and oftentimes for things that are just inevitably on the flock safety roadmap, you know, and it's why not just put another, you know, billion dollars into, into them is kind of a calculus that I'm sure you guys run. This is like the anderil of whatever is going to be anderil. Yeah. But sometimes that's true and we just try to put more money into anderrol.

We've probably just put more money into Flok Safety. We've done that many times. I think that as we get smarter and learn more about these markets, we recognize that the surface area is just much, much more expansive than we realize. So take, for instance, 911 services. Well, Flok Safety doesn't do anything with 911 services. Being a 911 operator is a thankless job. It's an exhausting job.

The turnover rate is very high. And that entire world needs to be totally reimagined with AI, where you have AI operators, answering the calls, triaging the calls so that the operators can deal with calls more efficiently. First responders can have more information at their fingertips. Flock safety is not going to do that. Another example, you read constantly about what's happening at Newark Airport with the FAA air traffic control system break down. Obviously, a venture-back startup can do a much better job than whatever we've had for the last 30 years trying to make, you know, the air traffic controllers better equipped with, you know, really dated radar systems,

not getting the information they need about what's happening down on the ground at the airports. And so that's just an obvious opportunity. Well, neither Andrew nor Fox safety is going to do that. So we just think these surface areas get bigger and bigger the more we look, especially the ones that have not been disrupted by modern software. Totally. Yeah, that makes sense. Last question on space investing.

There's a lot of startups that are predicated on declining launch costs. are you seeing the trend in launch cost pricing and dollar per kilogram to orbit on trend or ahead of trend or are we lagging there? You would have to ask my partner, Catherine. I'm not the space expert. I have to confess. But I think that the cost is going down. And we're seeing companies that are now and sort of that next echelon of what happens now that launch is achievable. Sure.

What about when we really expand and be able to return things to Earth, you know, reliably and quickly? VAR just made a lot of progress there. So when that really unlocks, then what what companies come next, I think is a question to ask and that we're asking. Yeah, she's been on the show. We didn't get to answer. We didn't get to ask her that, but we'll have to ask her the next time that she's on. But thank you so much for taking the time to chat with us. This was really great. Yeah, great to finally have you on. And enjoy the rest of LP day. We'll talk to you soon. Cheers. Yes, thank you. A little round of applause. Fantastic. Next up, Anish who I think your buddies with.

You've chat with a few times. I'm excited for this. conversation. You can... More than a few times. Dear friend. Okay. Okay. Yes.

Yes. Your boys. My boy. Your boy. I'm excited to chat with him. It's long overdue to come on the show. Yeah. Yeah.

Yeah. We've been trying to make it happen for a while. Glad we can make it happen today, even if it's just for 15 minutes. But we'll bring him in. What are you interested in talking through? What are the interesting angles to take with him today? He's focused on the application layer. Okay.

So a lot of... the if you see consumer enterprise is there delineation there both uh both but leaning consumer sure so um yeah i just want to get into the app layer what he's cool how he's you know he's a extremely um busy guy and i've seen his process oh he's in arc boats have you seen it the electric yeah and that was like a super that was a super

that was a super um super random deal that I mean, he says he says he's AI apps investing in an electric boat company, but I've met the founders, very, very cool company. Anyway, welcome to the stream of niche. How you doing? Eddie, what's up, guys? There we go. What's going on? Why are we not in person? I want to see the size gun. I know. I know. We're going to come see. We just signed a lease today, actually, for a new space. So next time you're in L.A., we'll have to have to have you over. And we do have a comically large gong that has not been shown. But it's about it's about the size. It's at least, I think, like seven feet tall. So you can look forward to hitting that in person.

It's not busy, man. We used to get to hang out all the time and now we've got to do this to see you. I know. I know. I know. We both got busy. But it's great to see you. Thanks for making time today.

There's so much, so much to talk about. I was telling John before you joined a little bit of your background. But why don't, why don't you introduce yourself and maybe give a quick overview on your focus at the firm? Yeah, yeah, for sure. It's great to see you, Jordy. So I'm focused on AI apps. I lead our consumer team. So we do a lot in consumer. We do a lot in B2B. I've started two companies. I sold the first to Google, second in Credit Karma, which is why I've done a bunch of fintech investing as well. And this is great, man. I built my first company in 2008. And this is the most excited I've been since 2008. Like everything is working and people that are more technical are winning. So it's just like a fun time to be building or be around building. Did you always have conviction around the app layer? was a period over the last few years where people were kind of oscillating between, you know, there's no value in the app player. These are all rappers to back to, you know, just kind of back and forth. I'm guessing you never lost faith. I don't know, dude. I think the rapper thing

was such a mid-thought, you know, like maybe for like two months. Yeah. Give me a break. Am I lot to swear on here or not? Our kids are watching. Yeah, we keep it usually pretty clean. We're working on a bleep fact now. But yeah, go, go swear. with the people. Okay, I will not. I'll save it for a beer when we hang out in person. But look, if you look at the kind of evolution of that comment in particular, sure, there was a minute when it seemed like you had to either spend $100 million

to train a foundation model or you had to be a quote unquote rapper. But as soon as you started to see fine-tuning and then all the things that came after it, and then, of course, open source, that stopped being in consideration. So anybody who tells me that there's this like rapper concern hasn't thought deeply enough about it, I think. Yeah, I also think there's an effect there, which is people. that aren't seeing enough real data from companies at the application layer and seeing the growth rate of some of these companies where you're meeting with, you're meeting with companies

all the time that I'm sure you're that that are growing at rates that would have shocked you in 2021 and that you're even passing on because it's maybe not even best in class now, right? I don't, you know. Yeah. And the top decile is not zero to one in, you know, 12 months or zero to two in 12 months. It's like zero to 10, zero to 15. We've seen 10 to 80, like bananas. And what is it?

Yeah. Yeah. I mean, talk about open source a little bit. Are you seeing that impact financials in any way? You know, obviously tokens can be expensive. We've talked to some early stage founders who are pre-launch and they're like, I need $500,000 of like open AI credits to just do the pre-work that I need to do to make my, my startup work. I haven't heard about that.

I mean, we were in the free AWS credits. If you go to YC, you get a bunch. People would not burn through those. They're burning through tokens. Have you seen that as a meaningful cost driver at the early stage and has open source shaped that at all? Yeah, there's actually two things to talk about here. One is it's actually amazing that there are real costs because it forces companies to make

money. So it forces them to charge real prices right away, which forces them to deliver value that substantiates the prices they're charging. So the business model quality is way better than a, it was three years ago, ironically, because the underlying software has gotten more expensive. So we're seeing way better, especially in consumer, Jordi, you know this, right? Like, so much of a consumer was this field of dreams investing. You know, we'll build it and someday we'll have ads, whatever that meant. And a lot of times didn't work. And now, like, day zero, people are charging

for subscriptions and they're making tons of money. And actually the most interesting. And there's strong willingness to pay because people have had such magical experiences on the consumer side, people will be like, sure, I'll pay 50 bucks a month for this, right? Or more. You know, and this is why the most interesting question right now for builders is what is the $1,000 a month skew of your product? Right? It's not can I charge. It's what is the like insanely expensive thing.

And this is why I think for consumers, like you're going to have food, you're going to have rent and then you're going to have software. That's what the consumer spend looks like. On the open source question, John, I think what we're actually seeing is this routing layer emerge where companies are routing to different models based on capabilities and cost. So in some cases, we need something that an open source model can do or you kind of make the cost-benefit trade-off. You do that. Other times you might route to, you know, Claude because you've got a coding thing that you need to generate or a long-form writing. You know, OpenAI has got really good general-purpose reasoning models. So the routing layer is actually a very interesting thing, and it only exists because there's so many models and because there's open source.

And that's changing the consideration for companies like OpenAI that are now moving up the stack. They bought WinSurf. they're doing a bunch of things at the application layer because they're no longer the sole provider of the models. How are you thinking about the line between consumer, prosumer, and bottoms up adoption in the enterprise? Because I'm sure you've had this already where you make an investment into what looks like a prosumer tool and then suddenly you see some Fortune 500 company adopting it in different patches. It used to be those early stage startups would be like, oh, well, one person from an at google.com email signed up so let me just put google on my landing page now it's like yeah

they're actually getting meaningful adoption in the enterprise just from the bottoms up perspective but yeah what are you seeing from my mindset everybody's a consumer i think the greatest thing ever happened to consumer software is giving people expense cards at companies oh yeah instead of i t buying something individuals are buying something and of course it's not like you've got this work it's you know work brain and personal brain like you bring your personal brain to work and you want to use consumer grade software. And we're seeing products like KREA, that's one of our best companies. You know, this team is like cracked. They like live to get every model. They're so technical. And the product has a sort of aesthetic and a sophistication that a regular IT buyer might not

understand. But it's getting huge adoption in the enterprise because the people that are in those companies want to be using the best tools. And this is what they look like. How do you think about the gap between what's happening in these like super agile startups. It's a couple people. They ramp to 100 million in sales really quickly. They're in the enterprise. They're making a difference. Consumer adoption versus like McKinsey is also making like billions of dollars selling like PowerPoint decks on AI adoption. Is there a world where someone closes that gap and builds like a McKinsey for as a startup or something? Or is that, is that a dynamic that's actually good and maybe McKinsey's underrated in some weird way?

I mean, I would argue that the main thing McKenzie knows, McKinsey knows how to do his sell. to the enterprise. Sure. There is no product there. Their product is deep research, but worse. Okay. Everyone's a McKinsey consultant now. No, yeah.

Yeah. Yeah, because any CEO can, first question, they ask, how should my company be using AI? And then they go and sign up for a bunch of stuff. How are you thinking, what's your timeline around ubiquity of ads in consumer AI? Because we're in this interesting moment where, a lot of people are paying for models. Some people are using free version of models.

But ads aren't ubiquitous yet, but the movement from OpenAI, you know, Vigycemo coming in from Instagram. Obviously signals. Big ads business there. My take, I was debating with Jordi, was that I love the world where every human being,

regardless of their economic condition, has access to the smartest possible model. But I'd love. to know your take on ads in AI products because it feels like it's coming, but we haven't really seen it yet. I mean, I think the more spiritual question for us is what is the front door to the internet, you know? And the front door to the internet has been Google for so many years. And it's really interesting actually because Google is sort of search based and intention based. And the browse based web that existed in the 90s, we've kind of moved away from. A lot of the browse based

behavior is now in Insta and TikTok and these other places. Yeah. Yeah. So we're cool in the command line era of AI. Like chat GPT is a command line product essentially. And I think it's to evolve in a really different direction. And wherever that terminal state of that direction is, we'll define the monetization model. I'd be surprised if it's ads. Maybe it will be. So I don't know that we'll ever see ads in the way that we see them today in the AI ecosystem. What about what's happening with the hypers? Broadly, obviously they're all investing insane amounts of money in CAPEX, but they've been, by most reports, lagging on the product side. Is this something where their monopolies are so strong, they're just going to wait it out and develop the products internally?

Is there a wave of them in A coming in AI apps? Are they going to try and build or buy? How do you think all this plays out in the big tech world? I mean, probably all the above. Number one, I think when you have a new technology, the existing companies do a good job of extending their lead in their existing markets with the new technology. So I think a bunch of that will happen. You know, Microsoft will get better at delivering the word processor they've always delivered, and Google will get better at delivering the search results they've always delivered.

The real issue for Google is not somebody builds them on search, but that there's a new front door to the internet. So the new categories are where the upstarts will dominate, and that's where I think we'll see a lot of the M&A activity. But it's probably all of the above. The one most surprising thing for me, not just for sort of incumbents, but often for incumbents, is just that people aren't using the products. Like I talked to VCs, you should test investors on this. Like, give me the five things that you're actually using every day. And if the answer is chat GPT, come on, you know.

So there's such an opportunity to build intuition by actually just using the products. And yet so few people do it. It's like this alpha that's hiding in plain sight. Well, that's great. Thank you so much for coming on the show. We'll definitely have you back. Come back on again soon. It took us too long to do this.

The ex-time person. I want to ring the gong. Oh, yeah. Yeah. Well, we have a sound bard now. We'll talk to you soon. All right to see you, dude. Thank you so much.

And next up we have Mark Andresen, the founder of Andresen Horowitz, coming. Why is nobody talking about Mark Andresen? Why? No one really knows about him. And I think what we need is just one more Twitter thread breaking his career. Yeah, this was something that probably made us laugh. It was a top three laugh last month. We enjoyed it.

Somebody posted a thread on Twitter. Yeah. And said, why is nobody talking about Mark and reason? I think that was probably. entirely chat chbtee generated but uh you shouldn't need much of an introduction no uh but we're a big day for him so uh we're we're glad to bring him in and uh ask him about open source what he's learning from the dot com boom uh american dynamism geopolitics uh raising a huge fund there's so many things to talk about so excited to have mark on the show excited to go uh deep with him on

everything andrews is up to and the firm that he's built so we will well welcome into him into the studio. Welcome. How are you doing, Mark? Hey, guys. What's happening? It's been a great day. I'm going to hit this real quick. We have the sound effect board. Thanks so much for joining us. And thanks for wearing us, thanks for wearing a suit. Yeah. Yeah. Yeah. Exactly. Yeah. Special occasion. Yeah, special occasion. Yeah. Congratulations in the podcast. I just want to start out by saying I've been watching. It's just, it's tremendous. Thank you so much. You know, I have a funny story. We, uh, the moment that I realized that you were maybe paying a little bit of attention to what we were doing.

And it gave me some conviction that we were on the right track because we did a reply guy of the week to this guy, Baldo. And it was like this inside joke. And I was like, holy shit, Mark just followed Baldo. Very talented guy, but yeah. So it's, thank you for, for following along. And it's been awesome talking to your whole team today. Yeah.

Fantastic. So let's go through some hot topics. I want to start with, we're in the AI era. You obviously live through the dot com era. there's some comparisons. What have you learned and how is this time different? Companies are making more money. Valuations are high,

but how are you thinking about teaching the next generation what they should learn or what they should ignore from the people that might say, this is the dot-com boom 2.0. Yeah, so look, I guess I'd say, I think as Mark Twain who once said, history doesn't repeat, but it rhymes. And so, you know, I think people looking for like a direct compare

contrast. Sometimes you see people like drawing charts or the stock market's going to do the same thing or whatever. Like, I don't think that stuff ever quite happens that way. But, you know, it does rhyme. And, you know, the line that John Dor had in 1995, I remember, was that the internet is a cream that you rub on investors to get them all excited. So, John Dorr said that. That's a way. Yes. Yes. I have many. I have many, many, many, John. Please. Keep again. Oh, yeah, exactly. But, you know, so, you know, I has like that now.

You know, look, the AI, sorry, the internet went through, you know, went through phases. People actually forget, but there was like, you know, there were like these, even the phases, like, on the way up from, you know, 95 to 2000. You know, there were these phases of like skepticism and panic. You know, it looked like the whole thing was going to fall apart in 98. And then, you know, in 2001, you know, after the dot com crash, you know, like all the big companies just like completely wrote the internet off and they just said, you know, thank God that's over. And then, and then the internet itself just kept growing, right? And then, you know, by 2005, it was back to, you know, kind of, you know, back to back to where it had been before. And we, you know, the rest was what was history. And so, you know, people kind of go, people are kind of bipolar on these things. They kind of get overly excited. They get overly depressed. I, you know, I just always thought then and I think now the substance matters, you know, the substance overwhelmingly matters. And so, you know, is, is, is, is the technology great. Like, are the products great? Are people using them? And, you know, AI is like, off to the races so far. It's just like unprecedented rate of growth of actual use. Right. You see that in all the numbers.

And then, you know, look, the businesses, I, you know, I just, I talked to another conversation yesterday with like, you know, a company that's raised seed money. They're already over 10 million error with this incredible, you know, like it's just and, you know, there's like a lot of those. Like, you know, they're, they're all over the place. And so, you know, the, the things that are working, the products are fantastic. You know, the users are getting tremendous value out of them. And as you know, the base technology is moving really fast.

So I feel really good about it. Yeah, I mean, it can move faster because we have the internet. Like these apps can get to 100. of millions of daily active users because there's hundreds of millions of people. There's billions of people on the internet. Very interesting. Not to linger on the dot com stuff too much, but I'd love to know a little bit of a history lesson around the way the browser wars played out. And is there anything you can learn from that that applies to the open source versus closed sourced AI debate? You've been very opinionated on that. I'd love to know, kind of, is there,

are there any previous eras of tech that you're mapping to when you think about open source AI? Yeah, so, you know, a lot of the browser was, you know, there was kind of a big company, little company, kind of big company thing. And, you know, I think that's repeating itself. And, you know, I think one of the ways to think about what's happening right now is open AI is kind of growing up to become Google. And Google's kind of, you know, reinventing itself to be open AI. And so, you know, there's like a similar thing there. And, you know, then you look, Microsoft and Apple and Google control the operating systems, you know, for, for end user devices. And they all have, you know, a lot of those issues are going to come back up. You know, two of these big companies are actually federal trial right now, you know, in big FTC cases in Washington, D.C., actually in the same courtroom. And so, you know, many of those issues will repeat or, you know, will be intense. You know, the open source thing in tech has always been the wildcard. I think it's always been an incredibly positive wildcard. You know, I've always been, you know, enthusiastic supporter of it. My original work was all open source. And so, you know, the real thing that app with open source is in operating systems, you know, basically Unix won and then, you know, specifically Linux one, you know, for everything

on the back end. And I, you know, like, you know, I remember like in the 1990s, there was like a furious operating system war. And there were these companies that were making huge amounts of money on server operating systems, you know, companies like Sun and many others. And then, you know, Linux just like commoditize that entire thing. Yeah. I think it's plausible, you know, we'll see.

But look, it's plausible that open source AI may just be the standard. Like it, you know, and whether that derives out of, you know, deep see or Lama or, you know, any of the other new things that are coming out, you know, we'll see. But like, I think that's entirely feasible. And, you know, I think that would be obviously, you know, There are companies that would have to adjust to that if it happens. But the other side is if kind of the world had AI for free, I think that would be a pretty magical result also.

Yeah, totally. I mean, shifting to the geopolitics of all this, is it important not just that there's an open source champion, but that there's an American open source champion or a Western open source LLM? Yeah, I believe so. And I believe so for two reasons. One is just actually cultural reasons, which is just, you know, open weights is great. But like the open weights, like they're baked, right?

Like the training is in the weights and you can't really undo that. And so are you being trained by, you know, a company or an organization or a set of people with American or Western values? Are you being trained by, you know, by, you know, a company with Chinese values. And look, you know, there's issues on both sides. You know, the American train models have their have their issues. They have their weirdnesses, you know, but the Chinese train models, you know, look, they like score really well. You know, they literally, in the Chinese benchmarks, they literally have like line items for like Marxism, right? right and you know deep seek like it's like a hundred out of a hundred on

Marxism right and so it's here for deep see really knocked out of the park of that line congratulations yeah exactly it's fantastic right and so it's like all right so these are going to be you know this is going to be the technology that's going to intermediate your legal system right the courts the education system the medical system like you know how you know you want your you know if you guys have kids like do you want your kids to you know your kids are going to be learning from these things their whole lives um and you know do they have, you know, do they fundamentally have Western values? Or do they have, you know, sort of, you know, CCP values, I think is really critical.

And then the other thing, just, I would say, just close your eyes and just imagine two states of the world. One is which the entire world runs an American open source, LLM. And the other is where the entire world, including the U.S. runs on all Chinese software. And I, you know, I don't know. For me, that's a, you know, very straightforward. It's a very important topic and a very straightforward answer. Yeah, I mean, in the American dynamism context, is it kind of mission accomplished there?

or are there new territories that you're looking to expand into with the broader American dynamism thesis? We talked to DU about energy and whatnot, but what is exciting about you outside of artificial intelligence on the national interest investing side? Yeah, so, look, we made tremendous progress. I'm super proud of that team. And then, you know, in this new political environment, the new administration has embraced it, but also a lot of Democrats are actually quite excited about it also. And our event that we hold has, lots of people from both parties. So I think there's a, you know, there's this unified view now, I think, in the American, at least in the political world of like, all right, it's, it's time,

you know, it's time for the U.S. to step up on a lot of these things. It's time for the U.S. to build more. It's time for the U.S. to, you know, reinvent energy. It's time for nuclear. You know, it's time for, you know, infrastructure, you know, housing, like all these things. And so, you know, I think there's a lot of momentum. I think we're at the very beginning of it. You know, like, one of the ways to think about what we're doing American dynamism is we're going after all the sectors of GDP that are like really big and not yet basically affected by tech. And so education, health care, housing, defense, law, you know, just to pick five, you know, those are giant important slices of the economy that largely have not been transformed by

technology in the last 50 years. You know, the U.S. Defense Department spends, you know, coming up in a trillion dollars, very little of that money is going to technologies and companies that have been invented, frankly, in the last 20 years. You know, most military hardware in the Department of Defense is, you know, the F-16 is from the $1 billion. the 1970s, right? Like the U.S. plane that does a high altitude photography, the high altitude spy plane, it's still the U2, which is it's just like literally a 70 year old plane. So like there's just like enormous changes, you know, that really have to happen. And I think everybody kind of in the system knows that, but it's hard to get there. And I think, you know,

a big part of that is, you know, these new companies, you know, that we try to support, you know, they need to show up and make their case. But, you know, the entrepreneurs are fantastic. and then we see more receptivity coming from the system than we ever have. Talk about the kind of position the position that the firm is in today. In many ways, it feels like you and Ben and the team had somewhat of a crystal ball to see how the private markets were evolving, companies staying private longer, AI being this massive platform shift that's going to upend every industry. And then now the sort of political environment that enables industries to kind of get a second

or third life. Did you just get lucky or did you see a lot of this coming? I mean, I think we got a few things right. We got a bunch of stuff wrong. You know, we buried those ideas up back behind the shed. So, you know, we made a bunch of mistakes along the way or changed a bunch of things. But, you know, we got a few big things right. You know, I think the things I think we got right. You know, what is like the venture ecosystem is you guys know is just evolved enormously in a very positive way. And the kind of old model of having a sort of a bunch of kind of mid-sized firms that kind of sit on Sandhill Road and wait for the founders to come in, like that, that, you know, those days are kind of over. You have the rise of the high scale, you know, firms like us, but you also

have the rise of all these seed and angel investors, you know, that are really, you know, first money in and then really working closely with founders from the very beginning. And I think that, that ecosystem is healthier than ever and doing really well. And so, you know, that's been a big change. You know, and the IPO, like, I don't know, I would say we have changed on that, which is I used to, I used to complain a lot. Like, I used to give these interviews years ago and, you know, like early 2010s and just complain about like the that it was basically becoming impossible for companies to go public and you know the things that had had caused that to happen and what needed to change and then you know of course nothing happened like there were no reforms you know there were no improvements if anything everything got worse um and so you know we and others adapted to that by you know by basically putting you know putting ourselves in a position to fund companies you know later in their life cycle at higher higher you know larger amounts of money you know later at growth stages um and you know it's now much more common for companies to do these tenders and these kind of private, you know, private sales even for their employees. You know, so that's been a big change.

You know, but look, I don't know, maybe the best directional bet we made was just technology was going to keep becoming more important. It's just like in every area of our life, the bet that, you know, in sector X, tech is going to be more important. They're going to be big tech companies built. They're going to really matter. That, I think is just, that's a very good bet. I think, frankly, I like, I don't, it's hard for me to ever see that ending.

Yeah. What are you, you know, you guys are with your LP, today, tomorrow, what are you hoping they take away from the event? Oh, so this is not a John Dorr quote, but I'll give you another quote when we were raising money originally. We're going around. We were going to raise our first fund in 2009. And, you know, the world had, you know, completely collapsed after the financial crisis. And we, you know, went around and we sort of briefed all the, all the, you know, all the, you know, all the ventured VCs we respected to just give them a heads up for what we're doing.

And one of the GPs took us the side of the end and said, you know, you guys have been dealing with like these very smart public market investors. He said, you know, part of the job you're going to hate the most is working with these LPs. You know, they're just terrible. And he said the key is you need to treat them like mushrooms. You put the, you put them in a cardboard box, you put the lid on the cardboard box and you put the box under the bed and you don't open it for two years. They're like, what's the markup today? And so, you know, look, the view Ben and I always had was the exact opposite of that. which is our investors are our partners, you know, and look, that's how we want to be treated by the companies we invest in.

You know, that's how we always viewed it when we were running public companies. Our investors are our partners. You know, they're in it with us together. You know, they're making a big bet on us and trusting us. And then, you know, look, correspondingly, the promise that we made to them is like, look, we're going to try to like deliver, you know, excellent returns. But in this business, it's just going to take a long time. And, you know, you guys know this. For any company that really succeeds, it takes, you know, 10, 20, 30 years.

you know, to really have it succeed. And like, and along the way, like, a lot of things happen, you know, everything from negative headlines to, you know, lawsuits, disasters, chaos, you know, all kinds of crazy, you know, twists and turns, changes happen along the way. And so I just think it's, like, really important for us as a firm. Like, we really always need to make sure that we're treating our LPs as full partners. And so we, what we're trying to do is be just really like open the kimono all the way, show them everything, kind of expose them to everything that we're doing,

make sure they really understand it, go as deep as they want to go on the, on the technology and on the companies. And this is like year 15 of this for us. And so far that, I think they would say that that's gone well. That's great. Last question from me. Just general advice for the next generation of entrepreneurs. Are you hoping more college, less college, more coding, less coding,

less coding. There's a ton of technological change right now. inspired comedian in the world opened it up and says Steve Martin's, you know, advice for being a great stand-up comedian. And it was, be so good, they can't ignore you. Right? It's like, okay. Thank you, Mr. Martin. You know, I'll get right on that. But like that, that remains the best advice, I think, which is just like quality,

like we said, like quality bears out, like quality shows. And so, you know, a, you know, really excellent thinking coupled with a high degree of, you know, energy and courage, you know, team building, a great team and then a great product, you know, in a real, you know, insight into a market with customers figuring out how to design, you know, not just design a product, but also design a business. Like, that's basically, like my view, my view of that as an entrepreneur always, like, that's my job as an entrepreneur. And like, if I, you know, if I put a lot of time and effort into that and very serious about it, I can hopefully do a good job. And I think time spent improving the quality of the thing,

the product and the business is almost always better than time spent, trying to, you know, networking or, you know, publishing a presentation or, you know, trying to get positive press coverage or kind of all the external stuff. And so it's really it's really the quality of the thing. And then, you know, again, my hope would be like we as a firm and others like us, like that we really, you know, that we really recognize that and see it, you know, see it, you know, kind of see it when it shows up. And I think that's the thing.

And then I think the other thing would be look like AI is superpowers, right? And like if you as a founder have access to, you know, just to, you know, to say, chat GPT deep research, it's just like, oh, you know, it's just like, oh my God. Like I have a, you know, like I have a PhD level. It used to be so hard to get information, right? And then it's been so hard, you know, even still to figure out what to do with it. And so to now have this tool, you know, these tools for thinking through everything and, you know, increasingly being able to do things like write code, you know, we ought to see a generation of founders here that are just like incredibly capable, you know, relative to, you know, to what we used to be like. And, you know, we're starting to see those.

We're starting to see, you know, it was a handful of those. You know, that's it. I'm still waiting for, like, the real conceptual breakthroughs. like I'm still waiting for the you know the company where it's like you know it's got a thousand employees 99 or bots like you know I haven't seen that yet and you know somebody's going to really figure out how to use this technology to really not just bring a product to market but like fundamentally change on companies operate and I think that's probably that's probably the next big unlock how do you think about an individual's edge around their own proprietary knowledge

there'd been talk of with Warren Buffett you know retiring he read something like a hundred thousand plus earnings, transcripts, you have this incredible recall. You're often credited with having this incredible recall and it certainly can give you an edge in thinking through, you know, net new opportunities and decisions. Do you think that edge remains in a world where all human knowledge is accessible in a single query or what's your kind of mental model there? Yeah. So I think it's going to be, I mean, look, I think there's basically like two ways to really have a differentiated edge, like, in general, right? There's sort of, you know, it's kind of go deeper, go broad. You know, go deep has kind of become a more and more specialized expert over

time. And, you know, look, there are domains in which that, like, really matters, you know, biotech and, and things like, or, you know, by the way, designing, you know, AI, you know, working on AI foundation models. Like that stuff really matters. The deeper you are, the better. So there's, you know, certain fields where that really matters. I think for most fields, though, now with these new tools, I would probably bet more on basically people who are able to be broad, which is to say, basically, can you know something about a lot of different, you know, kind of aspects of life and how the world works? And then you can use the tool, you can use the AI to go deep whenever you need to, but then your job as the human is to basically then, you know,

basically cross the domains, across the disciplines. And look, you see this, if you talk to any like the great CEOs, you know, you kind of see this, which is like the really great tech CEOs, they're great product people and they're great salespeople and they're great marketing people and And they're great legal thinkers and they're great finance people and they're great with investors and they're great with the press. Right. So it's this, it's this sort of multidisciplinary, you know, kind of approach and being able to cross domains. And I don't know, we'll see, we'll see how good the, you know, we'll see how good the AI gets at that. Hopefully it gets good at that also. But, you know, that's that in a lot of ways. You know, the entrepreneur has always kind of had the burden of, you know, for somebody who wants to do something serious.

Like they have to be like that, at least to some extent. And, you know, the best entrepreneurs of the future, I think will probably be like quite skilled at like six or eight things. and then able to kind of cross and combine them. How do you think about the responsibility of the venture industry broadly to try to influence, you know, outcomes in the world. I was sort of laughing, you know, less than a month ago, a lot of investors were clearly shifting capital out of the U.S. and just, you know, yolowing into French bonds and things like that.

Venture capitalists obviously didn't do that, right? But at the same time, there was a high profile story of a venture capital firm, you know, investing in a Chinese AI company that we won't mention here. And it got me thinking around there, you know, if you're operating a hedge fund, you can go invest wherever you want without a ton of scrutiny, right? People don't look at that as, you know, finance. If you move assets into some, you know, Chinese market, it's less of a, yeah, it doesn't, it doesn't feel like you're betting against your own team in the same way.

So I'm curious how you think of the generalized kind of response. of venture capitalists, even especially as the sort of AUM has scaled dramatically. Yeah, it's like actually been the arrow of progress. Yeah. Yeah. Yeah, look, the big thing I think I would say is like we always, we always thought and inspired that we were building things that matter and that we're going to have an impact on the world.

And for a long time, you know, we were trying to convince people that we were doing that. And they never quite took us seriously because it's like, you know, it's like, all right, databases, routers, like, okay, nice, you know, nice guys. I don't even know what those things are. You know, even personal computers, like a thing on my desk. I write letters on it, you know, whatever. Like, just like tech was never like relevant to politics, really. You know, and all this, I'm talking about like between the modern era,

1950s call it through like the 2000s. And so, you know, and look, you know, generally speaking, like our press coverage was, you know, generally people were like, wow, startups are exciting. And, you know, when companies succeed, it's great. And then, you know, in the last 10 or 15 years, you know, like questions like yours, you know, have started to come up. And then, you know, correspondingly, just as you know, like just enormous amounts of kind of criticism attacks, you know, kind of indictments of, you know,

people with all kinds of points of view on the industry. I would say, you know, in the beginning, that kind of irritated me because I had gotten used to the environment where either nobody cared about us or people just said nice things about us. What I came to realize is we're the dog that caught the bus. Like we actually now are building things that matter. Right. And so, you know, tech now interfaces direct, you know, when Elon goes into the car market, like he just, you know, the repercussions of that, you know, to your point, like on many countries are just gigantic. and there's a thousand examples like that that we could give, and, you know, AI probably being the biggest of all.

And so, you know, look, it worked. Like the stuff that we do now, the companies that we fund, they really matter. They really have, you know, really big implications for society and for policy and politics and geopolitics. And so mainly I think the responsibility is on us as a firm, as well as, you know, our companies. Like, we need to go explain ourselves.

You know, we need to go be present in the policy debates. As you know, like, we have a, you know, we have a huge push now into policy and politics that I never imagined we would have. By the way, it's something I got wrong. I never thought we would have that. And then it became very clear that we need that, you know, kind of for this reason. So, so, look, I just think that's part and parcel of like of it working.

Like, we're going to have to do that. And then the geopolitics, you know, the China thing, I think is probably the most intense version of that. You know, maybe that's when we got right. We just never really did anything in China for a bunch of reasons. You know, look, and by the way, we'll see, you know, this is a fluid situation. And you guys, it's been publicly reported that there are, you know, talks underway with China. So the relationship with China could be better or worse, you know, in six months. I think that's what everyone wants, yeah.

Yeah, I mean, everyone wants, like, cooperation in general. Yeah, like, look, it's possible. Look, I mean, I'll give you my favorite, and here's my favorite story. So in 20, I think it was like 2011, at the time the Obama administration was trying to reestablish, was trying to reestablish a relationship with Russia. And there was a famous moment where the Secretary of State, who was this, this woman named Hillary Clinton, I don't know, whatever happened to her. I hear rumors that she then went on to, I don't know, did something.

in politics. But she was the Secretary of State, and there's this famous photo where she was on stage with Sergei Labrov, who was the Foreign Minister of Russia, her counterpart. And she brought like a big plastic red button, which was the reset button, right, to reset, you know, warm relations with Russia. And then, and then what happened was Medvedev, who was... The reset air horn.

Exactly. And then Medvedev, who was the Russian, who was Putin's number two, actually came to Silicon Valley. And the Secretary of State's office called all around to Silicon Valley saying, please, you guys, roll out the carpet to Russia. There are new friends, like do everything with them, do whatever they want. You know, please go invest in Russian companies. Russia's building this new Silicon Valley, see what you can do to support them. And so it was like, you know, like it was just like a love fest. And then, you know, fast forward four years later and, you know, Putin became,

you know, Putler, as they say, and, you know, just, you know, and then, you know, Russia gate, like everything that followed. And so, look, I would just say part of being citizens, I think is, you know, we're just going to have to navigate through shifting geopolitics. Our view, and quite honestly, like, our view is just, we're going to put ourselves squarely the side of the United States. Our foreign policies affirm is the United States foreign policy. If they don't want us to do things in China, they don't. By the way, if they come to us and they say we should do more,

like we'll look at it at that point. But we're trying to be good citizens among everything else. Yeah, it makes sense. Talk about the evolution of the A16B brand. You guys came out with a new logo and website. And as always, you're good at getting the attention of the internet. I was a fan of this. Yeah, we talked about it on the show.

we liked it. Yeah, I think it's something that's different and will age very well, but I wasn't exactly sure, like, what are you trying to say with it? What are the references? And even what was the process? Like, did you pick the color? I don't know. Or even that conversation?

I wouldn't know more about the brand. Yeah, so first of all, you know, I know we got some Twitter controversy on it, and I just want to thank Kanye West for drowning that outcome entirely. Yeah. I don't think we're at talking of conversations at the moment. So, yeah, so that worked out well. So anyway. So, yeah, look, so we have this incredible designer, Greg Trudeau.

He's got a team. They did a fantastic job. I did. I worked closely with them on it. I have no design skills, but I provided a lot of input. You know, I think the big thing about it is what is intended to sort of reflect is like an embrace of what I think is a broad set of cultural changes that are happening right now. You know, frankly, you guys are a part of as well, which is this, whatever.

would describe is that I don't know 15 year era of I don't know like cultural almost shrinkage everything get you know and you see that in the design world it's like everything getting like ultra clean minimalistic and culturally everybody getting like very cautious and careful about what they say and you know with all this kind of censorship and speech control and then you know this whole thing of everybody used to feel bad about everything all the time and everybody needs to feel bad about the country and bad about their you know ancestors and bad about this and bad everybody's just miserable all the time Like I just think like that whole thing got kind of as you know, I don't know, you might call it like pure, you know, neo-puritanism or something. Totally.

Like that thing kind of crested in, I don't know, 2012 or 2022. And, you know, basically in the last three years, I think there's this like renewed sense of energy, enthusiasm, ambition, you know, achievement, you know, dynamism. But like, you know, and again, it's like literally, yeah, we should have nuclear energy. Yeah, we should have rockets going to Mars. you know yeah we should like we should we should have these things um and that you know that it's good to succeed um it's good to build businesses it's good it's good it's good to make make new things in the world you know and yeah we should have the thousand you know yard tall you know shining colossus on on elcatraz island yeah yeah i was gonna ask my my only request is like make it make it

real you know like like make it the statue of liberty of the west coast yeah i'm imagining a massive instantiation of that coin in the office and maybe physical versions not the coin like the actual figure you know the actual figure True, yeah. Yeah, we need a monument. You know, she has a name. She has a name. No, what's the name?

She has a name. Technomedes. Techno Medes. I love it. That's fantastic. Amazing. That's great. All right.

Well, Techno Medes, buy a plot of land, somewhere visible from the Golden Gate and just, you know, build it a mile high, please. Mile high. Make it happen. Make it happen. Thank you so much for joining.

This is fantastic. Thank you, guys. Really enjoyed it. Have fun with the team in the LPs. Cheers. We'll talk to soon. Bye. Fantastic. Let's give it up for Mark Andruson. Absolutely dog. Fantastic allocator, size lord, all the above.

People love to yap online, but you talk to the team and it's hard not to be gigab bullish. For sure. There will never be enough venture capital. We didn't even get to that. But we'll say that for Ben. Yeah. We'll save that for Ben. Anyway, should we do some timeline? Should we get out of here? What do you think in jewelry? Well, John, I'd like to talk to you about Figma. Okay. Tell me about Figma. Figma is the tool to design and build products. It's a tool that we use. Everybody knows that already. I've been a DAU for my entire career at this point, and we are very lucky to have them as a sponsor and a partner on the show.

Crazy story, by the way, from David George earlier talking about how Dylan came to him during the middle of. Hey, you want to invest? Yeah. How about now? Same price. We've been discussing the price, right? How about that price? But I mean, that was a fantastic time to actually invest.

Yeah, the NBA had basically, you know, just shut off. Yeah. And that was when, how about now? How about now? Put your money where your mouth is. That's why Dylan's one of the best ever doing. But I really appreciated getting a snapshot of everybody at the firm. It's such a massive organization, like Eric said, 600 million.

or sorry, 600 people, not 600 million. Sorry, we're in hour, hour four of the show. Yeah. Anyways. What else we got? What else is in the news? Tigers kind of out of the game, they led 47 Series A's in 2022. This is from Aaron Harris. Tiger hasn't led a series A since June 2020.

Although we saw that they are changing their strategy and they're doing pretty well in their open AI investment. So we'll see how the overall fund performs. but they were, you remember back in 2022, they were going crazy. They would meet a founder, term sheet, same day on the call. They would give you a decision. It was actually really nice because you just take the meeting and you know exactly where you stood by the end of the call.

But obviously a shifting strategy for Tiger and the crossover funds, a lot of them stepped back. All I want is for them is for Open AI to hit that one T mark and then Tiger says, you know what? We actually were on to something there. There we go. It is the best of time. It doesn't even, it felt like they were doing more than 47 series A's, but that was 2022.

Well, that's just the series A's. Well, yeah. They were doing Bs and Cs. They were doing everything really fast. But also 2022 was, there was really only like four or five months where things were really ripping and then things became, it became obvious that things were getting little dice. Yeah. Intertrades went up.

No board seats, moved very fast. That Walmart capital is Everhandle. at Kleiner Perkins refers to refer to it as. Ryan Peterson says, a gentleman is never rude except on purpose. And Paul Graham shimes in to say, the original version, a gentleman is someone who is never unintentionally rude,

makes a stronger claim. It's defining the term instead of just telling us one thing that's true of them. I like this because it's essentially a coinage. So instead of saying, a gentleman is never rude on purpose, say a gentleman is someone who's never unintentionally rude, define a gentleman, it's kind of re-coining the phrase. So you take a word that everyone knows.

You know, an entrepreneur is someone who never accepts a downrout, who always announces a preempted round, who always has... Who always gets preempted. Yeah, a generational founder is always get preempted. They go out to raise. They still get preempted. Yeah, it's great. Packy's talking about Harry's. They just launched a new razor. They've been in the business for so long, these Harry's guys. You got to take here. So they, so it's a very polished ad. It is honestly a fantastic ad that's like half vibreel, half comedy. The founders are in there. I thought it was a fantastic ad and I learned that, hey, they launched a new razor. It's kind of like four blades has a pivot. So it's a more modern

design. Apparently that was under patent. The patent expired. So they were able to enter that market and they already own a German razor factory. Do you know the story of Harry's? Their seed round was like a hundred million dollars and they bought a razor factory. Because the, the whole industry was very monopolistic. Yeah. But they're positioning themselves as like, we're going up against Big Razor, which is true. Like Gillette is a huge, huge company. But also, I think that they tried to sell themselves to Big Razor at some point. And so there's a question here in my mind of like, do, can they really say that they're little tech still? Can they really say that their little razor once you bend the knee?

Yeah. At what point do you just claim we're now Big Razors? Exactly. I think Harry's so Lindy at this point. It's over a decade old. You're part of Big Razor. I'm putting you in the Big Razor bucket. Yep. Anyway, Sean Frank had a good post. Talked to a founder today. Her business was worth more than Ridge growing 100% year over year. I asked a personal question, how much money do you have? Oh, basically none. Business is huge, growing fast, only ever raised a small amount, but no cash for salaries, no cash for dividends, no secondaries. I think this is really stressful. She's top 1% of 1% of outcomes. On paper worth hundreds of millions still has to rent

apartment, rush to your first million liquid, even if you have to grow slower, even if you have to take a lower valuation to get secondaries. Money doesn't make you happy, but it certainly reduces the level of stress. So, interesting take. Good take. Sean. What else is here? Oh, we got to cover the 747s there. The 7478 Boeing business jet, BBJ, VVIP aircraft. Here's a comprehensive list of these planes. People think 747s are around. People think private jets are around. Really the overlap of private jets that are at this scale is quite, quite small. And so Qatar has three. Kuwait has one. Oman has one. Brunei has one. Morocco has one. Turkey has one. Saudi has one. Egypt has one. And the U.S. has technically has two for Air Force ones. And that's it.

And so first, shame on all of the tech elite for not stepping into the 747 BBJ game. We're going to get a lot of, he's a 737. The other one that we saw, which will go unnamed recently. That was also a 757. So 747 is the biggest, the most expensive. The truly elite. Two stories in many configurations. Absolutely massive plane.

Very expensive. And it's, of course, the plane that is being rumored. to have been delivered to Trump as a gift, and there's a lot of debate over that. But, I mean, I say America needs more 747 BVJs, for sure. That's essential. This Pachy post kind of relates to what Mark was talking about. Everything is technology. He's breaking down 2025 venture-backed exits over $1 billion, and you're going to have to

hit the size gong multiple times for this because we got whiz at $32 billion. Core weave at $23 billion, ampere at $6.5 billion. Deliveroo, it's $3.9 billion. Windsurf at 3 billion, Deribate at 2.9, MoveWorks at 2.9, Scorpion at 2.5. Poppy at 1.7. Ninja Trader at 1.5. Hidden Road at 1.3 and 7 rooms at 1.2. So an absolute stacked year of liquidity above the $1 billion mark for tech companies. Everything is technology. Thanks for highlighting it, Paki. You'll love to see it. The data's from Pitchbook, and he's breaking it down for you.

Oh, I like this post from Signal, and then we'll get out of here. you should be able to trade employees like sports teams trade players would be hilarious today open ai traded two mid-level engineers for a researcher and a veteran ux manager there should be a trade deadline every year okay i love signal but i i basically posted this exact same thing like six months ago you remember that i think you did i think it also went equally equally viral so i think i think i must have um he's he's trading your post for one of his posts and he's running it up bucks you know we love to see it i love to see it play the hits if you're not going to play him he's going to play him i love to see it anyway uh the last piece of news from semi-analysis over the past 30 days

the tech leads responsible for rock m pie torch have submitted 14 prs that's uh that's amd's implementation of pie torch that runs on amd graphics cards that have been behind uh versus invidia pie torch tech leads have submitted 22 poll requests and so amd is finally catching up to Nvidia. Just like the LLM maintainers, we are working on internal infra-infra pipeline to track the quantity and quality of PRs for Nvidia and AMD to gain additional insights. Stay tuned. And so Dylan Patel from Sillanalysis, fantastic analyst, obviously, but he's coming on the show in a few weeks. We'll have to ask him about the race between AMD and Nvidia, but it feels like it's heating up. And I love a horse race in tech.

Love a horse race, John. So stay tuned. We'll see you tomorrow. We have a massive show for you and we're going to be in a new studio soon. So please leave us five stars on Apple Podcasts, Spotify. Our board of directors said if we don't ask you to leave. You have to do it. You have to do it. We're going to shut the show down. If you like the show at all, leave us five stars. They said they're going to pull the plug. We're going to pull the plug. Go do it. Thank you for tuning in today. We love doing this show. And we hope you have a wonderful evening. We'll talk to you later. Cheers. Bye.