TBPN - Trump's Tech Dinner, Tesla's $1T Pay Package, OpenAI Mass Producing Chips with Broadcom, Seal Team 6 Mission Gone Wrong | Joe Weisenthal, Jason Droege, Dave Marra, Mert Mumtaz, Harish Abbott, Tuhin Srivastava, Cecilia Ziniti

Episode Date: September 5, 2025

(01:34) - Timeline (13:35) - Trump's Tech Dinner (22:19) - Tesla's $1T Pay Package (36:25) - OpenAI Mass Producing Chips with Broadcom (45:26) - Ellen in the Mansion Section (53:23) - Joe Weisenthal, born September 2, 1980, in Detroit, Michigan, is an American journalist and financial expert. He serves as the executive editor of news for Bloomberg's digital brands, co-anchors Bloomberg Television's "What’d You Miss?", and co-hosts the "Odd Lots" podcast. In the conversation, Weisenthal discusses the recent jobs report, noting that the number was below expectations and highlighting concerns about the labor market's state. He mentions that excluding health care, the economy has been shedding jobs, with manufacturing employment down 78,000 so far this year. Weisenthal also touches on the impact of AI investments on employment, suggesting that while data centers may not add significantly to employment, the promise of AI could lead to job destruction rather than growth. (01:25:15) - 2019 Seal Team 6 Mission Gone Wrong (01:28:46) - Washington Post Now on Substack (01:31:00) - Timeline (01:53:42) - Giorgio Armani Passes Away at 91 (01:59:25) - Jason Droege, a seasoned technology executive and entrepreneur, is the Interim CEO of Scale AI, having previously founded Uber Eats and served as a Venture Partner at Benchmark. In the conversation, Droege discusses his extensive experience in the tech industry, including his role in launching and scaling Uber Eats to a $20 billion annual gross merchandise volume, and his current focus on expanding Scale AI's applications and services business to deliver customized AI solutions for enterprises and governments. (02:23:05) - Dave Marra, CEO of Rivet Industries, discusses the company's mission to serve the half-billion workers in the Western world who are underserved by big tech, focusing on those in demanding environments like flight lines, factories, and battlefields. He highlights Rivet's recent $195 million contract with the U.S. Army to develop next-generation soldier mission command systems, emphasizing the importance of comfort, ruggedization, compliance, and utility in their products. Marra also notes that advancements in technology have now made it feasible to create such devices, which were not possible five years ago, and underscores the significance of dual-use applications for both military and commercial markets. (02:37:15) - Mert Mumtaz, co-founder and CEO of Helius—a developer platform for the Solana blockchain—discusses the launch of Tempo, a new Layer 1 blockchain focused on payments, developed by Stripe and Paradigm. He highlights the controversies surrounding Tempo, including its positioning as an L1 rather than an L2, and the challenges of maintaining a payments-only chain in a permissionless environment. Mumtaz also addresses the potential for Tempo to become permissionless in the future and the implications of such a transition. (02:53:49) - Harish Abbott, co-founder and CEO of Augment, announced the company's $85 million Series A funding round, led by Redpoint Ventures, to enhance their AI logistics assistant, Augie. He discussed Augie's role in automating tasks like quoting, dispatching, tracking, and billing, aiming to streamline operations in the fragmented $900 billion freight industry. Abbott also reflected on lessons from his previous venture, Deliverr, emphasizing the importance of customer focus and operational efficiency in scaling Augment's solutions. (02:59:58) - Tuhin Srivastava, CEO of BaseTen, an AI infrastructure company, announced the company's recent $150 million funding round. He discussed BaseTen's focus on simplifying AI inference for businesses by managing the complexities of deploying and scaling machine learning models, allowing companies to concentrate on their unique applications. Srivastava also highlighted the company's rapid growth, expanding from 30 to 104 employees in the past year, and emphasized the importance of speed and efficiency in the competitive AI landscape. (03:07:02) - Cecilia Ziniti is a seasoned technology and legal executive with over 20 years of experience, including roles as the founding lawyer for Amazon's Alexa and General Counsel for Replit. In the conversation, she discusses Anthropic's $1.5 billion settlement with authors over AI copyright infringement, highlighting that the agreement addresses past unauthorized use of pirated works for training their AI model, Claude, and noting that authors will receive compensation of at least $3,000 per work. 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.comAttio - https://attio.com/tbpnFin - https://fin.ai/tbpnGraphite - https://graphite.devRestream - https://restream.ioProfound - https://tryprofound.comJulius AI - https://julius.aiTurbopuffer - https://turbopuffer.comFollow TBPN: https://TBPN.comhttps://x.com/tbpnhttps://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231https://podcasts.apple.com/us/podcast/technology-brothers/id1772360235https://www.youtube.com/@TBPNLive

You're watching TVBN. Today is Friday. September 5th, 2025. We are live from the TBPA Ultradom, the Temple of Technology, the Fortures of Finance, the Capital of Capital. We have a great show for you today, folks.

I thought we'd mix it up. People have been complaining about the screaming. We decided to take it in a different direction. We heard you. I think we'll be back to yelling on Monday. That was pretty weird. Anyway. Never again.

Never again. Should we actually just dial it back and run it back again? You want to do it again? A second take. Yeah. Okay. You're watching TVVN! The current thing is big numbers.

$200 million for the free press, Barry Weiss's media company to CBS. People did not like the quiet in the chat. They said, scream. We're back to $610 million for the browser company. We talked about that a little bit yesterday. Ramp hit $1 billion in ARR. Great hit, great hit. 600 billion in meta-capex.

And one trillion potentially on the table for Elon Musk at Tesla. So we're going to go through this. So the free press is one of the most impressive media companies built in the last decades has Austin Reef from Morning Brew, correct? Yes. Huge congrats to Barry Weiss, Nelly, Snoozy Weiss, this is a funny name, for building something truly different. This is, I think, still rumored.

I don't think it's fully confirmed at this point, but it's all but. Yeah, it was hard to tell which side was leaking the news. Yeah, there's this dynamic where media likes to talk about media, and I feel that 100%. It's super interesting to hear about like the business of Joe Rogan or the business of Huberman or any of the experts. but so obviously also you know you're surrounded by journalists literally if you run a media company so they all talk I've heard that one before but you're surrounded by journalists and so obviously everyone talks and the media leaks out and the news leaks out and it could be interesting ways for either side to put pressure on getting the finish line exactly what they want out of the deal

yeah yeah and so there's there's a series of takes I was talking to a buddy who works in media who was coming at me with like, it's a crazy number. And so that's kind of level one. Level one of the take is like on a price per subscriber basis. Seems high. I think they have about a million free subscribers. $200 per free subscriber feels like a lot, I guess. Kind of hard to tell if you think about long-term value for CBS.

But then others are complaining about the political implications of the deal. Is this something that's like a give to Trump to help get the demurger or the spin-out? out approved, something like that. Yeah, and I mean, this is an $8 billion deal as merger, and media companies are now entirely, like, media companies at their best are personality led. Yep. And paying $200 million to bring on, you know, a face for CBS, one of the most important

properties makes sense. Yeah, that's my, that's my, like, level three, like, final take, which is that, you sort of have to put aside the price per subscriber take and you have to put aside the political implications to take. I just think about it from, it's a big company, $8 billion, you said, something around there, does bringing a younger, more entrepreneurial talent into the organization move the market cap by 1% or 2% over the next few years?

It seems like the same math that we're doing for buying a very expensive AI researcher. you're paying a lot of money in terms of like what like a salary would count, but you just can't get that level of talent on any sort of normal. The overall property. Exactly, exactly. And so I was, the person I was talking to who was like, this is a ridiculous price.

I was like, yeah, but dude, like if you were at CNN, you could probably add $200 million of value to that organization pretty quickly. Yeah. And so it's just a matter of time until like the market and the, board of directors and the shareholders kind of wake up to that dynamic of how power loss certain people are

and actually go and figure out how to get the deals done and and david ellison is doing deals right he just did ufc deal 100% 100% 100% and there's a lot of big numbers flying around and there's an and there's an interesting dynamic where and the the premium right we saw this yesterday with the browser oh yes yes yes you do get a big fantastic outcome uh for having the at the beginning of the name maybe we should just be the business production network. Drop the technology. Technology's over. The hype cycles peaked. We're just the business production. We're in the trough. We have some fun stuff coming in terms of the hype cycle soon. But it's interesting because many companies just cannot justify putting someone on staff for $100 million W-2. We've seen this as Apple with Tim Cook. You know,

the CEO pay. Once you get into the eight, nine figures. for bringing that up. No, thank you for, no, seriously, thank you for bringing that up. Oh, yes, it is. Thank you. Apparently, Tim Cook, we'll try to pull up this video in a bit. Apparently, he said thank you 12 times in two minutes when talking with President Trump last night at the dinner. Yeah. So he's very grateful. So the, so yeah, meta's like the first company to really like break this trend of just like, yeah, we're willing to pay $100 million in salary. We will do the crazy acquisitions and the aqua hires to get really talented people in the org. But I don't think other companies are in that world where they could go out and hire somebody like a Barry Wise just for $100 million. It's got to be done through an acquisition.

That's what gets board approval. That's what gets shareholder approval. And so you're kind of wrapping an individual, an influencer, someone who's incredibly talented and entrepreneurial, around an organization just to actually get the cash flow to flow through. It's making me think about. CBS News for the first time in decades. Yep. Yep. Yep. Yeah, it's true. And even if the, even if like the subscriber numbers are like a little low, I mean, honestly, a million is a ton, it's a great job. But even if they are a little low, it's like, well, what are they compounding at? What will the free press

be able to be at in a decade with the support of CBS and the, and the backing, financial backing of CBS and Barry Weiss's execution strategy? Like, could be 100 million. I don't know. Could be really, really big. But you don't have to raise money for it. You can just focus on growth. Anyway, similar story at the browser company, $610 million from Atlassian. Very interesting deal. The timeline was not a fan of it. They came from the land down under with a Brinks truck. Yes. And so a lot of people are asking, is this, is this some run around by the Australian government to try and influence the browsing habits of Brooklyn hipsters? I don't think there's much of that. Try to control the narrative. Exactly. As a way to say, you know,

What if we could get all of the data from Brooklyn hipsters, all their browsing information, their communication? Yeah, they're known for drinking PBR. But what if every time they went to PBR on the ARC browser, the DIA browser, it just automatically rerouted them to Fosters? Yeah. Or the AI assistant on the side pop. Oh, oh, you're in DIA. You might like foster.

You're asking, oh, what should I do this weekend and just auto populates? Oh, yeah, we're using AI. Why don't you throw another shrimp on the Barbie? Yeah, and if you search, is it true? that kangaroos are extremely violent, it'll start spinning it and saying, oh, well, actually, they're only violent when promote. Provoked, yeah, they're actually quite peaceful.

Yeah, your dog actually tried to barked at the kangaroo and then the kangaroo went after it. Exactly, exactly. I think this is really smart from Australian, from, from, from people pulling the strings in Australia. Yeah, yeah, to get a little bit more influence the Brooklyn hipster and the ARC and Dia user.

Zeb did not like the acquisitions. Pull this up. Me, uninstalling ARC is a certified Atlassian hater. There is a wild gap between the vibes. And so some people have this take that like it was a vibe acquisition. They acquired better vibes with the next generation of founders. I think this is funny, but I think that from what we've seen, Dia, they're going to continue to operate independently.

I bet they're going to build some beautiful enterprise browsing experiences like they always have. Yeah. And they should build in re-stream. One live stream, 30 plus destinations, multi-stream and reach your audience wherever they are. So you should be able to stream from your Dio browser, from your ARC browser. So my take on this was there's, so basically right now the team is saying we're going to stay independent. We're going to go. But my question is, are they going to stay?

Are they going to stick with that narrative of like stay independent? And this is very rare for pre-product market fit acquisitions. I haven't seen a ton of examples of that where a company was acquired that wasn't like clearly on a, you know, just domic path. Instagram was bought for a billion dollars. Yes. And almost everyone involved at the time thought that it was crazy. They did. Yeah.

That is true. At the same time. And it was like a key threat to Mehta's business, right? Like the user growth was insane. I mean, I would love to look. at the retention metrics for Dia versus Instagram? Because it's totally possible. I don't know.

Do you know how many DAUs or total downloads Instagram had at the time of acquisition? I know it was small, but was it sub a million? I feel like it might have been a little bit bigger. Can someone look that up? Look that up, Tyler. I'm also curious about YouTube as well. YouTube was bought for roughly three times. And again, the dollar isn't.

what it used to be. Yep. Yes. So when Instagram was acquired, estimated around 860,000, so less than a million. DAUs. Okay, okay.

So, DAUs, though. Yeah, yeah, but still, I mean, we're in the same ballpark here. Very interesting. Instagram. People that have,

yeah, yeah, yeah. If DAUs is wildly different than total downloads. Okay, okay, yeah, yeah. But still, I mean, we're, we're in, we're in the rough ballpark where you could, where, at the very least, you,

like, what Atlassian is saying and what the browser company is saying at face value, they are saying, we're going to continue building this browser. We're in it to win the AI browser. We're going broad. We're going consumer. This is not,

we're acquiring this browser. We're going to bake it into Trello and we're going to bake it into Jira. No. I actually disagree with you here. All the messaging was that they're not going to be focused on consumer. Like from Atlassian CEO was that we're going to build, great enterprise browsing experience. Oh, okay, okay.

So there's nothing, there's nothing in there that I saw from the Atlassian side that said, yeah, we want to win in the consumer. Oh, really? Really? Okay. Interesting. Yeah. They are, they know their, they know their business, right?

Okay. Yeah. So it's very interesting. I can't imagine having like a work browser, but maybe that makes sense. I mean, people have worked laptops. But I feel like the trend has been, you have, you have, like, one phone that you do work and life on, and then you have separate apps, and maybe you have, you know, a, you know, an enterprise software product installed on your on your phone but really like there's

the trend seems to be more people using like gmail and google email at work and it seems like there's less and less like oh yeah like i have a separate work computer with a separate operating system chrome is very set up chrome is already very set up to have like profiles like personal profiles and work yeah i have i have two i have personal one so so i don't know yeah we'll have to see, I mean, the founder is saying, like, we're going to keep working on DIA, but maybe that means in the enterprise context.

Anyway, we'll have to keep an eye on, like, where they wind up going. So, Mike said, again, I said this yesterday, with DIA browser, we're going to collectively redesign the browser to help knowledge workers kick butt in the AI era.

And so that, that to me kind of reads a little prosumer, right? I don't think they're, but but it feels like, you know, very much oriented towards people that are working in the browser. Oh, yeah. OTP says, get Sager on here to give pushback on TFP by. He's going postal about it. I should text him and see if he wants to hop on.

We will, yeah, we'll definitely get him on when he's ready to, you know, go live and rip some takes. I also invited Barry Weiss. I'd love to hear her side of what's going on and what her plan is. it's a fascinating story. Of course, these are still leaks, so most people don't want to talk until there's finalized information. Anyway, if you're trying to design a browser,

you've got to do it in Figma. Think bigger, build faster. Figma helps design and development teams build great products together. Get started for free. And the third big number of the day, Ramp has crossed one billion in revenue. Sheesh!

Says Tyler. A key question is whether this is gross revenue or not revenue. I think it's gross revenue. or he goes back and forth on this. But anyway, they've been on a tear. As David Senra likes to say, it's a great example of taking a simple idea

and doing it deadly seriously. Taking a simple idea deadly seriously. I think David was quoting someone, but I attribute everything to David. We should pull up these videos from the dinner at the White House last night. I only have one question for Eric, which is, is the job finished?

So we will figure that out today. call him. I'm, he's busy. I'm going to, I'm going to play this video. Oh yeah. Please. You've done an incredible job with Apple, little company called Apple. Thank you, Mr. President.

Very, very few people have been able to do what you've done. Congratulations, please. Thank you, sir. That means a lot to me. Two thanks. I want to thank you for including me this evening. It's incredible to be among everyone here, particularly you and the First Lady. I've always enjoyed having dinner and interact.

dinner and interacting. I want to thank you for setting the tone such that we could make a major investment in the United States and have some key manufacturing, advanced manufacturing here. I think that says a lot about your focus and your leadership and your focus on innovation. I also want to thank you for helping American companies around the world. This is a very key, key thing, and I really enjoy working with your administration on those topics as well, because I think they're so important to the country. I want to thank the First Lady for focusing on education.

There's nothing more important than education. It is the great equalizer, and always will be. And so thank you so much for including me. We are all different in some ways, but we all believe in the power of technology to improve people's lives. And that is the thing that binds us all together. And Tim, how much money will Apple be investing in the United States? Because I know it's a very lot, and it's, you know, you were elsewhere, and now you're really coming home in a big way.

How much money would you be invested? $600 billion. $600 billion? There we got. We're very proud to do it. Thank you very much. Thank you. Appreciate you, sir.

Wait, is that 10? Thank you. I think it was 12. Somebody else had counted it as 12. I was around 10. Yeah. Crazy. We should.

Why wasn't Christina from Vanta there? I feel like that's key to the U.S.'s tech strategy. I agree. Automate compliance, manage, risk, proof, trust, continuously. Vantas, trust, management platform takes some manual work out of your security and compliance process. All right. We've got to pull up this video of... With continuous automation of Zuckerberg.

This was our fourth big, number of the day, Zuckerberg says he will invest around $600 billion by 2028. Zuckerberg says META will invest $600 billion in AI infrastructure by 2008. Meta's already guided CAPEX of $70 billion in 2025 and $100 billion in 26. So that's a big ramp to go from $70 to $100, and then they still got $430 billion to do in $27 and $28 to actually reach $600 billion. spending would need to jump to 200 billion in 2027 and 300 billion in 2028. That's a lot of dollars. Video in the timeline.

Let's play it. This is quite a group to get together. And I think all of the companies here are building, just making huge investments in the country in order to build out data centers and infrastructure to power the next wave of innovation. So we don't often get together as the CEOs of the different companies, but it's good to see everyone. How much are you spending would you say over the next few years? Oh, gosh.

I mean, I think it's probably going to be something like... $600 billion dollars in the U.S. That's amazing. No, it's not significant. That's a lot. Thank you, Mark. It's great to have you. Thank you.

Well, thanks for hosting us. That's awesome. So does anybody in the chat know if which of them went first? Yeah. Because that number, that number does not align with, that number does not align with,

with meta's stated. Yes, yeah, it doesn't appear in the SEC filings yet, but it is like very forward looking. No, it was 2028. 2028, which is something that they might not actually put out or might not be demanded by the, by Wall Street, but that is hilarious. Anyway, whatever they do,

they're going to have to do it on graphite. Graphite.comte.comode review for the age of AI, Graphite helps teams on GitHub ship higher quality software faster, get started for free. Yeah, so meta-guided CAP-X of 70 billion in 2025 and 100 billion in 2026. So to get to 600 billion, spending would need to jump to 200 billion in 2027 and 300 billion in 2028. Yeah, what's interesting is that, so these numbers are like insanely big. And obviously it looks like a big acceleration relative to past KAPX numbers. But I'm so inured to big numbers now

because of the fast takeoff crowd that was like, oh yeah, like trillion-dollar build-out data center like next year for sure. AI 2027, like it's going to be 10 trillion. Stargate, $500 billion. And so like when I hear $600 billion, I'm like, yeah, yeah, that sounds like totally reasonable. Like I think they'll definitely hit that.

And I don't know, but they probably will. Like it doesn't seem like there's many barriers. in the way. Like it's just continued to grow the core business, run more ads, dump the profits into CAPEX, build some more data centers. Semi-analysis, Doug O'Loughlin over it, Fabricated Knowledge has a good deep dive today on the glut of lagging edge chips that I think we might have a chance to get to in a little bit, but it was a fun dinner. Are there any other videos that we should play from the White House dinner? I like the idea of, this is kind of a new podcast format. Just have a dinner with everyone, have some cameras there.

And just, yeah, yeah, yeah, it's good. What's up, Tyler? I don't have another video, but there is, there was a photo that came out. I'll send him to the chat. But it was like the full dinner. And right at the very edge, I'm pretty sure it's Dylan Field. It is. Yeah, yeah, yeah.

So someone had the full breakdown here. It's in the deck, much deeper. Let me pull it up. Where is it? The full list of people who attended the dinner is, well, there's a lot of stuff. Okay, so Ed Ludlow has it. The full list of attendees at President Trump's dinner with tech leaders. The president, the first lady, Susie Wiles, Sergey Brin,

Geraldine Gilbert Sotom, Edgman, Greg Brockman, Anna Brockman, Safrake, Galtarach, Justin, Jason Chang, Meredith O'Rourke, Natalie D'Ompfe, Tony Fabrizio, Dylan Field, John Herring, Jared Isaacman. Jared Isaacman, oh, I guess he was... You're missing one. Elon didn't go, but isn't... Chamath. Oh, Chamath is in here.

So Sunny Madra, Satchanadella, Chamath, Polyha-Hapitia, Sondar Pachai, Mark Pinkis, Vivek Ranevi, who owns the Golden State Warriors. And I believe Vivek Juvranadivae is the like the guy who worked with Chamath on the first SPACs. And Vivek, Ranevibe kind of like pioneered that format almost. Did you say Lisa Suu from AMD? Lisa Sue made it. David Sacks, Shams Sankar from Palantir. we missed him yesterday. He was at this dinner in D.C. Jamie Siminoff, Alex Wang, Sanjay Marota,

Tim Cook, David Limp, Mark Zuckerberg, and Bill Gates. What a crew. Jensen didn't make it. So the fact that Jensen and Elon are not there, I feel like you shouldn't read too much into it. It's kind of just like Trump catching up with a bunch of people, but I don't know. There's also like this, yeah, I don't know. They haven't like falling out, but it seems like they've kind of patched it up. I don't know. Always hard to read too much into this stuff. But speaking of Elon Musk, he didn't need to be at the White House because he's setting up a $1 trillion pay package.

$975 billion. Oh, it's not a trillion. Just a little bit shy. Okay, so the update is Tesla's board has greenlit a fresh pay package for CEO Elon Musk. If he hits $400 billion in adjusted EBITDA, he deploys $1,000. He deploys one million robotaxies for commercial use, ships out one million energy storage units, produces and delivers 20 million vehicles, secures one million of ongoing FSD subscriptions, aim for a $8.5 trillion market cap. The gold retrievers are barking. The first and a half to 10 years in the CEO role.

The starting share price is $334.9. The package includes 12% of company stock divided into 12 segments. So Signal says this is a master class in how to design incentives. This deeply ties Elon's upside on the world radically improving. If he actually hits those milestones, the value unleashed for society dwarfs his payout. Most CEO comp is rent-seeking. This is moonshot seeking. I completely agree.

Every pay package for executives should be this absurd on both sides for the company and the individual. And this was exactly my take. It's like bet on yourself. Yeah, and he's done this before. done this before. And Dan Primack, when the pay package, the most recent pay package came into, under legal scrutiny, Dan Primack was like, I like this when it was announced. And I thought it was crazy. And everyone thought it was impossible that he would pull it off. And he did. So he deserves it. And so it was this crazy legal battle. But it was actually aligned with exactly what a CEO

should be doing, creating shareholder value. This should be a model for CEO comp going forward, in my opinion. There's another side. of this, which is increasing a founder-CEO stake by doing aggressive stock buybacks, but this is a way cooler because it incentivizes bold investments and huge cap-backs on factories, moonshot technology gambles, and generally thinking in decades. So I'm super stoked about it. I think it's good. I hope it holds.

It's a good way to signal, I mean, they're very much signaling to the base, the Tesla Army, that there's a lot of potential upside. Totally. Chris Camillo said earlier, been tracking XAI, accelerating cash burn, flattening user growth, monetization, and fundraising struggles since the beginning of this year. And I don't see how they last another 12 months without a Tesla or Elon bailout. I mean, saying I don't see how they last another 12 months without the founder bailing them out. It's like, that's kind of the founder's job, just continuously bail out the company.

But I thought this was relevant because I do think that, part of this, part of setting up this pay package could set up a scenario where XAI gets just merged into Tesla and it becomes a standalone. It just all gets rolled in. Yeah. Yeah. I mean, Tesla has, I mean, Carpathie work there. Like, it's a fantastic AI organization. And it makes sense that there would be a lot of overlap in what they do.

I guess there's probably, I mean, if X, the everything app was part of a public company again, how does that knock? How does that get valued at less than $8.5 trillion? That's a good point. And so with Elon having that ace up his sleeve, the fact that we're all addicted to this app. Yeah. I mean, I guess it's good that there's other milestones in there that you can't just merge everything together.

Because if you merge it in SpaceX and XAI. It's funny to think about some of the different milestones. It's like shipping out one million energy storage units feels like wildly like this even need to be included if you're going to deploy one million robotaxies for commercial use. Yeah. That one seems a little bit, I don't know, easy sandbag. Who knows?

I like, yeah, well, notably missing. What about post more tweets? Post some bangers. I would like to see a thousand. I want to see him go viral. I would say a thousand people a day marrying Ani. Oh, okay. That's the milestone.

That should be in there, too. Anyway. Oh, on Chimoth. People were making fun. Q-CAP has Chimoth at the tech leader's dinner last night, and he's a Drake on the basketball team, the Kentucky basketball team, fully suited up.

He's there with, he's there with, he's there with, he's there with, he's there with sacks, and he's big in GROC. Oh, is he? Oh, GROQ, yeah, that's right. That's right. Yeah, that makes a lot of sense. and Rune had a good kind of contrarian take on the Chimoth hate. He says, Youngheads don't know that Chimoth initially had his come up as the VP of Growth at Facebook.

While the app grew from 50 million to a billion users, they invented people you may know, which preternaturally predicts who your friends are, the concept of MAU, et cetera. All this stuff is in the water at any internet company now. More important, yes, he basically invented growth, the entire app, the entire idea that you can treat app growth as an empirical A-B-tested science. And we talked to a designer on the Facebook team at the time. And, you know, it's so easy to zoom out and look at Facebook as like, oh, it was like just a foregone conclusion that they would win everything and just completely dominate.

But there were moments. I love Jason popping in here in the comments saying it's his birthday party dummy. Yeah, it just turned 49. Oh, we did? Yeah. No way. That's amazing. What a birthday party.

Where else would you want to be? That seems like a great time. Yeah, people were having fun, making fun of Chimoth, but why not have them to be there? Makes a ton of sense. I love this post from Morgan. Should have gotten the other crew in there. Should have gotten Jason and Friedberg the invite. Anyway, what was the next thing about you?

Oh, yeah. Three-way deal. Elon is deal-making. Between X, X-A-I and Tesla? No, I mean, this is, it's Ed Lodlo, over Bloomberg saying Tesla's board has proposed a new pay package for Musk and proposed the author of of investment in XAI. Oh, sure, sure, sure. The board is looking at investing.

Remember, SpaceX already invested in XAI because they had to get exposure. Yeah, we saw that, like, complicated web of Elon companies, how they all link together. Maybe you just got to merge them all together. Pure Play. A pure play, Elon. Holding company.

Yeah. Send it to $10 trillion. Send it to $10 trillion for sure. The, yeah, I mean, like, Elon's, like, done, like, kind of these zombie murderers. convergers before with solar cities. I mean, some people framed that as a bailout and didn't hurt Tesla. The stock went on an absolute run, and it was great.

Just a flesh wound. And I never really understood why Solar City wasn't more successful because it feels like solar. You can talk to Casey Hanmarie is like the biggest solar maxi. And all of the like scientists, all the experts that I trust say that solar is, you know, going to continue to grow, extremely valuable, extremely important. but it seems like we've just been Solar City specifically, and basically any American solar company has been

kind of going to economic war with China and China's been like dumping cheap solar panels on the market continuously. So you need a company like Tesla to maybe subsidize that for a while until the U.S. government comes around to some sort of regulation on like what are

exactly are we going to do about it to create more of a level playing field. Either we're going to subsidize or we're going to put tariffs and taxes on their exports to get them back into what they actually cost instead of letting another company run roughshod all over the American

solar. This is interesting. Ed Luddlo also was sharing that Musk must also help craft a CEO succession plan to unlock the final tranches. Will Maximus Trump be old enough? What's this

name? X? There's a few wild names. It's got to be it's got to be a hereditary dynasty, right? He's got to let X take over in 10 years. The oldest Musk children are 20-year-old twins. Oh, they'll be totally ready in 30 years.

Vivian and Griffin, Musk, potentially co-CEO. Co-C.? Co-C.? That could happen. And then there's another one that's a little bit younger, who might be more in the like 20-something-year-old by the time Elon steps down.

but I would be surprised if he's not running Tesla in 10 years. I think he's going to stick around for a while, keep running it. He just keeps, he just keeps, you know, hanging out and building cars. And this is just fantastic news for people like Gary Tan who have been saying we need more trillionaires. Oh, that's true. Is that his thing? You don't think he's more billionaires.

We need our first trillionaire. The package could raise Musk's stake in Tesla to at least 25% with total voting power of up to 29%. Tesla's market cap must reach $8.5 trillion from $1 trillion today. The plan follows Musk's 2018 package, valued at $50 billion, which was struck down by a Delaware court. Tesla's board is appealing that ruling, but is also offering Musk an interim $30 billion stock award while pursuing the new deal. Musk's outside venture, SpaceX, X-A-I, Neurrelink, Boring Company, and political activity is worried concern about focus, but was Warren Buffett not focused on Seas Candy?

and Coca-Cola at the same time. Come on, people. There's a hold co. It's not that complicated. Gabby Golder went super viral, quoting some of these, quoting a video from, of Sam Altman at the dinner last night and said, this is like when you're at someone's birthday party and they make everyone go around and say their favorite thing about them. That's very funny.

And what did Sam say? Do we have the video? The rapid response. He said, thank you for being such a pro-business, pro-innovation president. It's a refreshing change. The investment that's happening here, the ability to get the power of the industry back.

I don't think that would be happening without your leadership. I love it. I agree. I'm happy to triple glaze as well. I like innovation. I like innovation. Arthur McWaters, I've been on the show many times before.

He says, I'm unironically working my butt off so that my wife can go to Pilates on a Wednesday afternoon. and get a $15 matcha and Siki says, same. It's a noble goal. I wish Raul

from Julius had been invited to this dinner. Yeah. I feel like he shows up in different pieces of Silicon Valley lore.

That would be insane. He really could have delivered. That would be insane. It wouldn't be that insane. He's on a generation run. He's fantastic. I just, I mean,

maybe we could work. That's why we sponsor. That's why we partner with him. Julius, what analysis do you want to run? Chow with your data. Get expert level insight in seconds. What could be more relevant to the government and having an AI data analyst that works for you?

Every CEO there is probably already using Julius. If they're not short. Yeah. More context on Zuck's $600 billion investment. Turner Novak says meta has done 478 billion in revenue over the past 13 quarters and plans to invest 600 billion in data centers over the next 13 quarters. Good thing they're growing revenue. Yep. Well, this is important too because data centers are the foundation of the global economy. And if we stop building them, everything is going to collapse. Token factories.

Continue to continue to. John Wu had some good analysis on the browser co acquisition. He said, man, parts of tech are sour about the browser co acquisition. and the common complaint is that Dia Arc slash ARC don't have enough users or revenue to justify the acquisition. First, I think this line of BITCHing assumes that Atlassians Corp Dev team

are dingleberries, dingleberries down under when in fact they're elite and one of the most disciplined and successful MNA units in tech. That's super legit. Rationally integrating products into the existing product suite and otherwise protecting independence

when merited, Trello, Loom, ops, genie, Agilecraft, many others. Second, I think this is part of some ridiculous coping narrative that some BCs and founders inhabit, which is that having differentiated product vision, assembling a world-class team that ships and being an incredible storyteller and salesperson is somehow easy. That's a really good point. Maybe you have more revenue.

Maybe you have more users. Guess what? The market doesn't give an F. I've read, seen, and heard directly from multiple people today, something like, oh, if I just knew how easy it would be to raise a ton of venture and make good videos, I'd do it and get acquired for $610 million. So go do it. Go do it.

I'm not affiliated with the browser cone anyway. I'm not here to pat anyone on the back. Do the whole well-deserved rigum of roll claim. I was just one small part of their success. I'm here to say the market has spoken. A transaction has been transaction. Capitalism has capitaled. Browser company is worth $610 million in cash.

If you're a VC founder, et cetera, in the salt mines today, focus on your business. If you think you can do better, do it. That is reality. Do we have the shots fired? sound effect. There we go. Shots fired.

Great way to sum it up, John. Yeah, just go and build a... Yeah, just go build something. I don't know. Go tell a story. Figure out a way. Yeah, I mean, underrated is like the... Isn't the founder of the browser company, like,

one of the core contributors to Chrome, like early on? Like, he was on the Chrome team. Like, if you want to build a browser, like, it's hard to imagine, like, having a better team in place. And, yeah, exciting. More breaking news, OpenAI is working on its own AI inference chip with a small company called Broadcom.

I don't know if you've ever heard of this company before. Hawk Tan. If you've never heard of Broadcom, they're a small company based out of San Jose, California. They are worth $1.57 trillion. They just had a massive, massive earnings beat because there was like this mystery $10 billion customer. and it was open AI, I'm pretty sure. There we go. So, broadcom.

A 14% in the last. I mean, it's just crazy that you can have a company that is in the same, similar, you know, similar, like, at the moment, like, priced in the same range as a company like meta. Yep. And most people would be like, oh, broadcom, yeah, I've heard of them. Like, but not be able to say much more about it. Yeah.

So Richard Ho, X Google TPU. was leaving 40 engineers over at OpenAI. Seems like Sam did a little talent rate of his own. Broadcom providing critical design and IP. TSM will fab it on the three nanometer node, inference only. Target mass production in 2026 could fail on first tapeout. So the interesting thing here is that I've been like beating this drum of like, yeah, GPT4 is good enough.

Like bake it onto silicon. Like just get the inference cost down. Just let me use it faster, cheaper. we have really, really good intelligence. We just need to inference it a lot more. Said the same thing about mid-jurney. I thought the images looked good enough. And yeah, they could get better,

but I'm fine with where they are now and they're fun. And so let's just make it really quick and easy to use. And it seems like they're going in that direction, for the most part. Because even the reasoning models, they're still built on, like, I mean, it seems like they're built on like a pretty stable foundation of the architecture, of the frontier model.

They're not making drastic, drastic architectural changes to the core LLM that powers these reasoning models. So bringing down the price of inference seems really, really important. So the Wall Street Journal has an article here. Open AI and Broadcom make a $10 billion deal for custom AI chips. Order aims to e-shortage that limited or the rollout of new chat GPT versions.

OpenAI is working with Broadcom to develop custom artificial intelligence chips, a move that could alleviate the shortage powerful processors needed to quickly train and release new versions of chat GPT. Broadcom shares surge nearly 11% in Friday trading. You said it's up at 16% now. What a great, what a great ripper. If you're looking to get into Broadcom, you think it's overvalued, undervalued,

do it on public.com investing. For those that take it seriously, they got multi-asset investing. Industry-leading yields. They're trusted by millions, folks. So. Yeah, up 74% in the last six months. Yeah, so on the earnings call, Broadcom. said, we've signed a fourth major AI developer as a customer and that the new customer

had placed a one-time order worth $10 billion for server racks using the Palo Alto-based firms' chips. The new customer is OpenAI, according to people familiar with the matter. The Financial Times reported the arrangement earlier. Sam Altman, OpenAI's chief executive, has been saying for months that a shortage of GPUs has been slowing the company's progress in releasing new versions of its flagship chatbot. in February, Altman wrote on X of GPT4.5, then its newest large language model was the closest the company had come to designing an AI model that behaved like a thoughtful person, but he lamented

the delays and high costs that came with developing it. I guess there's a big question, like some of these really, really big models, people have been saying, like, it's great, but it's slow, and that's, and it's costly. And I wonder if they're going to optimize for GPD 4.5 inference or GPT4 level inference. Tyler, do you have any take on where they might sit? Sam Altman said it's a giant expensive model about 4.5. We really wanted to launch to plus and pro at the same time, and we've been growing a lot and are out of GPUs.

I thought the demand for GPT 4.5 wasn't purely predicated on the cost and the timing and more just about the fact that people couldn't really tell the difference. Yeah, I mean, there's definitely a sense of, like, you know, only the high taste testers, like, actually, like, 4.5. Yeah. I would be surprised if they, like, really bring it back in any capacity. It's just, like, so expensive. Yeah. I wonder, I wonder what they're going to do. I mean, it seems like they'll probably still leave some flexibility, like, the TPU. They're not going to, like, go, like, you know, fully lock themselves into one specific architecture. But hopefully it brings down inference costs, increases margins,

which should be very, very good for the business. We love those. add tens of thousands of GPUs next week and roll it out to the plus tier. Hundreds of thousands coming online soon. I'm pretty sure y'all will use everyone we can rack up, he said. I like the y'all. I'm pretty sure y'all will use everyone we can rack up. In recent years

Open AI has relied heavily on so-called off-the-shelf GPUs produced by Nvidia, the biggest player in chip design space, but as demand from large AI firms looking to train on increasingly sophisticated models has surged, chip makers and data center operators have struggled to keep up. If we're talking about hyper-scale,

in gigantic AI factories, it's very hard to get access to a high number of GPUs. Founder of Compute Labs said, a startup that buys GPUs and offers investors a share in the rental income they produce. It requires months of lead time and planning with the manufacturers. To solve the problem, OpenAI has been working with Broadcom for over a year in secret behind our backs to develop a custom chip for use in model training. Broadcom specializes in what it calls XPUs, a type of semiconductor that is designed to with a particular application such as training chat GPT in mind. OpenAI also recently struck a data center deal with Oracle that calls for OpenAI to pay more

than 30 billion a year to the cloud giant and signed a smaller contract with Google earlier to alleviate computing shortages. It is also embarking on its own data center construction project Stargate. And so this is just another example of like, wow, they haven't made that much in revenue and they're committing to all these spends. It's like, well, they're growing very, very fast. and they plan on setting themselves up for success and high margins and more growth ahead. And if you need serverless vector and full-text search, head over to Turbo Puffer.

Search every bite. We puffin. It's built from first principles on object storage. It's fast. It's 10x cheaper and it's extremely scalable. You can get started. Be like cursor, notion, linear, superhuman, and many more. Yes.

Readwise is on Turbo Puffer. Oh, no way. That's very cool. That makes a ton of sense. That makes a ton of sense. Smart guys, working with smart guys. Okay. So we need to do a little bit of a meme review moment on the stream.

A monkey was handed an AK-47, and the image went viral and is now a meme. I don't know where this came from. It looks like an old image from a documentary. It's crazy how you can tell this image has been screenshoted. Dozens of times. Potentially more. It does not, yeah, and it also uniquely does not look like AI. but Levels Io kicked it off with point of view you can you discover you can do your own devops with clogged code and of course that could end in disaster skukes

your point one X coworker just discovered AI oh no I don't know how true that is I mean I feel like AI should be an accelerant but yes no no no no no no yeah you need to be at least one X co-worker like you give a bad driver a super fast car. Is that making them better? Fair, fair, fair. Turner, Novak says, letting the VC give product feedback. It's rough if they haven't been in the trenches. Liquidity says how it feels

to let the first-year analysts speak directly with the client. I love that. And producer Ben says giving the ramp card to interns. This is real. This is real. Do not do it, folks. You got to be careful.

You got to be careful. Ben's like, why do they have to request funds for every single purchase. Why don't they just have a limit that they can spend within? Well, I know. Because they are monkeys with AK-47s.

That card is simply too powerful. Yes, it is. Also, Brian Armstrong bumped up the max leverage from 20x to 50x on international perpetual futures and upslope capital just give the monkey the AK-47.

It's a great meme. I hope this meme sticks around for a long time, a long time. Anyway, If you want to get your brand mentioned on chat GPT, head over to profound, reach millions of customers who are using AI to discover new products and lands. You saw OpenAI's investment in broadcom chips. They're not going anywhere.

You're going to want your brand mentioned on chatypte. And you're going to want to do it through profound. And grok. And grok. And proplexing. And everything. And everything. So in the mansion section today, it's Friday.

We got 10 minutes until Joe Wisenthall joins to tell us what's going on in the United States economy. But one thing that is going fantastically well in the United States economy is Ellen DeGeneres's house flipping hobby, which has turned into a $190 million enterprise. So the comedian and wife, Portia Dorasi, have bought and sold more than 30 homes since the mid-2000. They are absolute dogs. The dogs, the absolute dogs of Montecito. So they bought a 10,700 square foot property in Santa Barbara, California for $27 million in 2019. They sold it for $33.3.3 million in 2020. Modest gain. Not bad.

But didn't take a lot of risk here. One year, one year, six mil, not bad. It's pretty good. Honest work. Let's read through the reporting in the Wall Street Journal's mansion section by Catherine Clark. She says, just before last year's presidential election, comedian Ellen DeGeneres and her wife actress Portia Dorasi decamped to the Cotswold, an upscale rural area near London.

They had bought a vacation home, a 43-acre estate to use a few months a year. Then the morning after the election, when they awoke to lots of texts with crying emojis, they said, we're staying here. Where was this? Which election? Oh, last year. Okay, so it's the Trump II election that was spar. sparking, crying emojis in Ellen DeGeneres's eye message.

Behind them, they leave a trail of luxury residences over the past two decades. The longtime California residents have developed a reputation as serial home flippers. The Wall Street Journal's research shows that the pair have owned at least 34 homes since the mid-2000s, including properties in Los Angeles, Beverly Hills, Santa Barbara County, Santa Barbara County's wealthy Montecito, and now the UK. Records show that the couple were actively buying and selling throughout the mid-auts in the 2010s, but their activities ramped up significantly during the, and we're going to move to page 8. This is one of the luxuries of reading the Wall Street Journal in print.

During the pandemic. So starting in 2020, they have frequently owned multiple homes at one time and show no obvious signs of trying to time the market for the best returns. Record show they bought. A patient. No, they're just, they just got the hot hand. They have the mightest touch. They don't need to time the market. They deliver value everywhere they go.

They bought at least eight homes in 2021. Wow. And 2022 record show. From the 34 homes tracked by the journal, the couple have since sold, they have posted a profit of roughly $190 million. That has to be in line with how much Ellen DeGeneres makes off her show and her core business. This is the side hustle of all side hustles. Their average return,

their average return based on the original purchase price and the subsequent sale price is about 37%, not bad. You need to raise the fund. Let me in. Ellen, the degenerate home buyer. Flipper, but not very degenerate. I mean, who knows? Probably a lot of leverage involved, but it's paying off.

There's some degenerate gamblers that actually make a lot of money. That's true. It doesn't mean that they're not being a little in a while. The pair's business manager, Harley Newman, said DeGeneres' real profits are much more modest once the costs of renovating are factored in. I would love her to have made that big of a killing,

he said with a laugh. Forget about the real estate agents and the escrow and title people, the costs of contractors and designers and the army that comes in once we've closed. It takes a village. He said those numbers also don't account for what DeGeneres spends on furniture that is usually included with the sale. None of the furniture is inexpensive, he said. She takes the art off the walls, but everything else gets sold.

Newman said 34 is an underestimate, saying he probably thinks she has bought and sold at least 50 homes since he's known her. Love it. Buying them and trusts. Yeah. Secretly. Very hard to buy a home secretly. It can almost always be discovered. The Wall Street Journal.

I mean, they uncovered 34 of 50 or so. The couple's homes have varied in size and style from mid-century and contemporary to Italianate an English tutor. It's not that I get bored. I'm just so passionate about architecture and furniture that you can only buy a certain type of furniture for a contemporary house or mid-century house

said DeGeneres in a phone interview. She talked to the journal. There we go. That's amazing. A large journalistic force headed doors and stand by. She said she has lost count of how many homes and they have bought and sold. That's great.

That's like you with angel investments. It really is. She has a home buying addiction and it's paying off. I text myself when I make a new angel investing addiction, so I just got to scroll up far enough. Got it, got it, got it. There is now a certain cachet in owning an Ellen house, said Rine Williams of the Beverly Hills Estates,

who represented a Hollywood executive who purchased one of their homes in Montecito a few years ago. Once somebody knows it's her house or she had a hand in it, it adds value. In L.A., she's synonymous with quality. She's a tastemaker. She cares about taste. Many of the homes have been sold off market without ever being listed for sale. The couple's Hollywood Rolodex seems to have come in handy.

Comedian Will Ferrell and the late actor Heath Ledger and singer Ariana Grande are a few celebrity buyers of Allen houses. DeGeneres said real estate has become a very lucrative hobby. Can you imagine Will Ferrell? Farrell, like, role playing as Ellen DeGeneres after buying one of her... Yeah, you imagine him in his, in some of his titular roles as kind of

disheveled middle-aged man, stumbling around a $40 million Ellen DeGeneres, neatly appointed home, and it doesn't quite fit, but I'm sure he's much more money. I like how she just flat out says to the journal, real estate has become a very lucrative hobby.

Let's go. Let's go. Turn your hobbies into side hustles. Turn your side hustles into... I mean, this is basically the main hustle now. She doesn't do the main show anymore. Yeah, that's true. The 67-year-old former television host has long had a passion for interior design and would have been a designer if comedy hadn't panned out.

She attributed her itchy feet in part to her family frequently moving between rentals in her native New Orleans area. We never owned a house, so I always wanted to own... New Orleans. That was on your A tier. That was in my A tier. Yes. I got in a lot of trouble for that. People did not enjoy my tier list. Nobody got the joke.

It's like some people got the joke. But I posted my tier list of best cities in the world, and it dusted some ruffled some feathers. I don't know if you have it pulled up, Dordy. I'll pull it up again. So John's, you said city tier list that will trigger everyone, but is true.

It's true. S-tier, NYC, L-F-F-D-C, Miami, Chicago, Austin, and Boston. A tier, Seattle, Nashville, Vegas, New Orleans, Detroit, Bakersfield, and Reno. And then no, there was nothing in the B and C tier. And the D was, of course, London and Paris. And then F was Rome, Berlin, Tokyo, Dubai, Hong Kong, Barcelona, Sydney, Buenos Aires. So basically, if somebody said, John, I'm going to Sydney, I'm going to see the opera. Do you want to come?

I'd be like, sorry, I'm at Baker's Field that weekend. And then if somebody's going to be in. He said, hey, all expenses pay trip to Paris. You say, sorry, I'm actually in the biggest little city, Reno. Reno, exactly. I would prefer to be in Reno. Anyway, we had some fun with that. Well, we have our first guest of the show, Joe Wisenthall, on the phone.

On the phone. Wired on the play. We got Joe Widenau. Pull up this picture that we just commissioned of Joe. There we go. That's real. And it's a real picture. Yeah, can you hear you hear me?

Yeah, you sound fantastic. You sound as good as you look. I understand why you didn't want to Yeah, I had a very Yeah, I had a very active summer. I didn't want to reveal it to everyone, but happy to have you with the exclusive on my new look. That's fantastic.

Incredible. Always great to catch up and always, I'm surprised you're away from your terminal on a day like today. Yeah, it's Jobs Day. It's the Super Bowl. It's the, it's Joe's. It's Joe's. It is the Super Bowl.

You know, it is the Joe Day. It is the Super Bowl day. It is the Jobs Day. You know, after 8.30, you know, obviously there's the initial hit, and then there's the rush, and then there's the market reaction. And as much as it is, the Super Bowl, by the, you know, by the middle of the day, I'm already like, okay, I'm good for the day. I had such a, such a high from following the numbers and seeing all the reactions and reading all the tweets, et cetera, that it's like, all right, I can sort of run some errands in the afternoon on jobs.

There we go. Thank you for squeezing this, Aaron. So, yeah, take us through the numbers. I mean, the market reaction. The Dow is down half a percent right now. NASDAQ's off. Yeah. Bitcoin's up 1%. Yeah. Yeah.

You know, it's an interesting. So, like, the number was not great, obviously, coming in a solidly below expectation. I think everyone sort of had a feeling it was going to. I think there just been a lot of anxiety about the state of the labor market right now. You know, people talk about the so-called whisper number where it's like, okay, here is the forecast that Wall Street has. But here's what everyone sort of really think. It's pretty clear that I think a lot of people just sort of thought it could be amiss. The last month actually was revised up a little bit, but the month before was revised down substantially,

such that June was actually now negative, which is the first time since I think December of 2020 that we had a month of job losses, which I think is interesting. Once again, health care employment, so that added 31.5. jobs in the month. So what that means is that once again, if you exclude healthcare, the economy overall has been shedding jobs for some time, which is- Including manufacturing. Yeah, so manufacturing employment down 78,000 so far this year, there was another decline this month. Look, like, this is what I would say about manufacturing, which is that I wouldn't mess, let's say a tariff strategy, we're going to work. In the last, and the last,

long term and we were going to have this sort of, you know, strong reindustrialization of the United States economy. I wouldn't expect it to work right away. I mean, the tariffs were unveiled on April. But what we can say is that so far those numbers, to the extent that this is a real priority of the administration or policymakers or others, to the extent that this is a real priority, it's clearly going in the wrong direction in 2025. Yeah. Also, I mean, last night there was that dinner at the White House with all the tech leaders and the numbers that were thrown out were staggering, $600 billion from Apple, $600 billion from meta. But that doesn't necessarily mean massive jobs growth because building a data center

might just be a multi-billion dollar check that's written to TSMC. This is a funny thing with the sort of data center AI sort of thinking about its massive impact Because first of all, you're obviously correct that these huge checks don't necessarily mean massive jobs growth. And if we're going to take seriously the promise of AI, it shouldn't lead to jobs growth. The test of AI is arguably jobs destruction, right? It's about what jobs that currently exist in the economy can be replaced by something that we call AI. And so not only does the data center is not add to employment in a meaningful way, if those turn out to be good investments, if there's a payoff, if they drive productivity,

you would expect them, you would almost hope them to be labor market negative. Maybe. I mean, there is a world where it's like a worker plus AI is additive and you can underwrite hiring that. So there is a hiring. Well, in our conversation, so we talked with, uh, I'm not a, I, yes. Yeah, I mean, I'm not a zoomer like in this, I'm skeptical of this. I find myself just from a sort of pure thinking about it through the economics lens of this idea of,

oh, AI is going to lead to mass unemployment, just for all the obvious reasons that anyone can say, I have caused savings because of AI, well, I'm going to like spend that money somewhere. Yeah. But the question is, do these investments actually free up resources or enable new things that expand our capacity of what we can do with labor? That's really the question more than the direct job creation. Yeah. Joey? Yeah, one point we interviewed Palantir's CFO and obviously Carp as well yesterday.

And they said something like revenue is obviously up massively in the last few years. Head count is only up 12%. And they said specifically we expect to have fewer people in the future. Yeah. I saw that quote, which I found to be really striking. And it is sort of, again, this sort of very weird condition. Maybe we've talked about it before. I'm not sure or not.

But it does seem like we're in some sort of uncharted territory here with respect to the fact that, you know, I don't know what's happening on a given day. Okay, maybe the net is next down a little bit. But you have all these names that are at or very close to all-time highs. Any other time in history, I think, where you're talking about some sector in your all-time highs, you are also associating it with a massive expansion of or at least a significant expansion of headcount typically. This is just sort of how it is in any industry. or otherwise, you would truly link stock performance with Headcom. And so it's interesting that here is a situation in which not only is this being articulated,

this sort of divorce between revenue growth and employment growth, but also it's not just a theory. It's clearly been happening in the industry for some time. Yeah, I wonder what Trump's like bowl cases. I haven't heard him kind of reconcile what's going on in AI and reindustrialization. There's like broad strokes of like, let's bring back the jobs. there's not a lot of early evidence of that, but I'd be interested to hear from people in the administration

about just like, paint me a picture of what it actually looks like. What is the American jobs economy look like in four years if everything plays out like you want? What are people doing? Because it does seem like we're going through a period of change. I don't know. What about... No, I mean, I do.

I think in defense of the administration, right, a lot of people are... I think people all over the place are... their heads over this question because what I think people want, what the dream is when they close their eyes and they want to see an economy in which you don't have to be an absolute superstar computer science PhD from Carnegie Mellon or whatever or Stanford to get a great job, there should be some sort of broad, middle of decent employment, whatever it is. And in the defense of the administration, I don't see many of people anywhere articulating, well, what that ultimately,

what sectors or what ultimately derived as sort of employment abundance, so this speak. Yeah. The youth unemployment data as well is absolutely brutal. Bloomberg economics had a chart showing it basically ramping in a way that it hasn't. It's youth unemployment is rising at the fastest pace in the past 15 years other than the pandemic, sitting at what's the number 10 and a half percent between the ages of 16 and 24. for. Yeah. No, I think it's important. So there has been this debate in the labor market, which is very important and interesting, which is we know that the pace of job creation has slowed. No one is

disputing the fact every month where, you know, the number of new jobs in the United States is going down. Then the question is, well, maybe some of that is because of the changes in immigration practices, or maybe some of this has to do with just sort of normalization of the economy. after a crazy few years. And so maybe someone would argue that the pace of job creation slowing down does not automatically say, okay, we're heading into a recession. That being said, the question then, the test then becomes, all right, what about just the ability to get a job if you want one?

And that's sort of essentially what the unemployment rate is. But it's interesting to watch some of these demographics that historically are sort of more marginal, more vulnerable. The youth unemployment rate is one, the black unemployment rate is one. black unemployment rate is another. That also that was at its highest since October 2021. And so even though the headline unemployment, 4.3%, they're pretty low by historical standards. What we're seeing is this deterioration of the job finding ability for some of these sectors of the economy that tend to, you know, maybe the sort of first to let go or some of these more

marginal, marginal segments of the labor forum. Is there a narrative coming together about what's driving the health care employment numbers and the health care job growth? Yeah, it feels like a lot of our elders are moving beyond unk status. Yeah. I mean, they weren't massive layoffs. It's the post-unk America. Because, I mean, there weren't a lot of health care layoffs during COVID, if anything, those are the people that kept their jobs. And then healthcare isn't particularly sensitive to interest rates.

Before we get into this too much, I mean, I think the big thing is CEOs broadly, even if they're seeing massive revenue growth, it's hard to go out on an earnings call and say, we're seeing massive efficiency gains. We're leading an AI in our industry. We're getting all these benefits from AI and then be like, well, okay, our employees are getting so much more efficient. And then be like, well, you also are ramping, why are you ramping headcount the same, you know, same way? Yeah, yeah. Yeah, right, right. Well, I think, so on this point specifically, I also do think there was maybe,

even though I think many people would say that the formal doge hasn't accomplished particularly much, maybe other people would argue otherwise. I don't think there is a quote, Biden shift, unquote, so to speak, where a lot of people are just sort of proud of the fact that they're keeping head tons across all of these things.

And I think sort of Elon Musk may have sort of shot the starting gun on this vibe that everyone can look within their organization and say, do we really need all of the people that we've hired, particularly after the boom years of 21, 22, and arguably 2023. But I agree on the health care employment standpoint, I mean, I would say two things. One is, yeah, it's the aging population. It's hard to imagine what would slow this train down. I guess it's slowing down a little bit because, of course, there have been some of those Medicaid, cuts to Medicaid growth, et cetera. So there is reasonable to think that maybe at the margins,

the monthly numbers of new headcount into the space is going to not be as fast as it was. But it is very hard to envision what could have happened in the short or medium term is that wouldn't automatically mean this sector is just going to need a lot more people every month. I'm certain if you talk to any sort of health care network of any sort that's on the ground in any community, I'm certain still today in September 2025 that they would identify acquiring talent as one of their big challenges right now. Talk to me about what we're seeing from the Fed.

The Polymarker has the number of rate cuts spiking today. Three potential rate cuts in 2025 spiked from 18% up to 38% and the chance of just a single cut is falling as well as two cuts. So Paul, you know, it's certainly expecting more cuts to come. And most people, yeah, most people pricing, I mean, it's pricing cut, cut, cut.

Yep. Yes. So I think, you know, it's funny, the last time I was chatting with you guys, it was from Jackson Hall. And that was a really interesting moment because you hit you, if you talk to a lot of the regional Fed presidents, they're like, I don't know, like there's also. Inflation still looks kind of warm. It's not totally obvious that cutting cycle or certainly an agreement.

aggressive cutting cycle. But you said, I remember you said, you said the labor market is clearly softening. This is the case for cuts. Like you, you, you've said that line. And if I'll lay that out. Thank you. Thank you. If I said something smart, I appreciate you remembering it.

But, you know, hollow speech and Jackson Hole, I called it. That's the main takeaway here. I call it. No, but, you know, it's a hollow speech in Jackson and the hole clearly, clearly, clearly centered risks to the downside with the job market. And I just think everyone has come around to that view. And so now the question is, especially in the wake of today's number, is that not only does September seem like a lock, it is for a rate cut.

I think the decisions in like 10 days. The question is, could they go 50 basis points? Could they go aggressive? Kind of like they did last September. And then also, I think October, which people thought, well, maybe they'd take a pause after a rate cut, that is now perceived as a good chance. So I think this sort of world really is coming around to arguably the Powell and then the Christopher Waller view.

He's probably been the most doveish of the Fed governors over the last six months. He's been pretty forceful in saying, look, the labor market is fairly softening and rate cuts are due. And I think right now it's the Waller-Powell sort of view that's winning out in markets and the expectations that they'll be able to get the rest of the FMC behind. Do you have any insight into what's going on with the Treasury doing a bond buyback to lower yield? Someone in the chat is joking that they're printing money to buy back printed money. I don't know if that's real.

Same old, same old. You know, to be honest, I do not put. I think these things tend to be very marginal and sort of plumbing related. You know, ultimately the sort of long end of the yield curve comes down to the market's view of the inflation trajectory and what the Fed is expected to have to do to maintain essentially its 2% goals. Some of these treasury moves, you know, they may have to do with liquidity, et cetera, but my advice to people when I have encountered these topics in the past is that generally these things are somewhat noise and to keep your eye on the ball about what's happening in the

economy over the medium term and how you expect the Fed to respond to it. So what's the next date on the calendar that we need to be tracking? Is it the next Fed meeting that's the big news? Or is there going to be more data? Yeah. So that's in two weeks. You know, the thing in the meantime, what I would say is yesterday we had the weekly initial jobless claims data. That's been creeping higher.

I think you should keep, that comes out every Thursday. And I think people should keep watching that because one of the ways that the economy has been characterized for really, like over a year and now is they talk about this low hiring, low firing equilibrium. which is that there aren't a lot of layoffs, but also it's not a great time, not a lot of, as we've been talking about, not a lot of headcount expansion. The initial job list claims has been picking up a little bit lately. Yesterday we got 237K, I believe,

that was ahead of, it was a bit higher than expectation. And you don't have to wait, you know, like I say, jobs report, Super Bowl once a month, but you get these many Super Bowls every Thursday where they talk about initial jobless claims.

It's no idea. Oh, one other thing. So keep it on that. Also, this coming Tuesday, there's something called the, and I don't remember what this acronym stands for, but it's QCEW benchmark or division. So it probably says for quarterly census employment something. This is actually how they sort of reset labor market data, because we know it's all very noisy, but every quarter they draw from actual a complete sample of every. everyone who's paid into the unemployment system. And so they get this very big snapshot. And it could show there's this view. It could show that the pace of job creation for all of 2024 going back was lower than expected. So they're always doing these revisions.

But I suspect that Tuesday will be interesting in terms of what it says backwards looking about just how much employment there really is right now. Yeah. I'm looking at the quarterly census of employment. wages and it says that Santa Clara, California has the largest fourth quarter over the year. Wage gained at 15%. And now I'm thinking if Menlo Park will see a massive spike in average wages because of the AI trade deals. It's just a hundred five people at a billion dollars a year. Yeah, speaking of big pay packages, did the new Elon pay package feel low to you?

Yeah, they're just paying a trillion dollars. What's the point of reincorporating from from Delaware to Texas, if they're only going to bump your target. I know, only a trillion. Come on. Oh, enjoy it. Yeah, I should have a Puerto Rico or something. Yeah, somewhere where you can really, where an executive could really get paid for the work that they do.

For one. I want 100% of the dollars that I create in the shareholder value here. And were you, were you disappointed to see that the White House snubbed Meek Mill on the invite to that dinner, the AI dinner last night? It felt like they really, it was a big. FU to Philadelphia broadly. Yeah, I would agree.

I was shocked. I was shocked by then. It's time to shake that room up in terms of who are the big tech names that get invited to these things. But clearly, our up-and-coming AI entrepreneurs, you know, regardless of what industry they are currently in or had been in, need to have a voice at the table. I do think going forward to we really need to have inflation data, and low part. Just generally, when you see these sort of, when you sort of, when you see these sorts of wage gains so concentrated,

we need to start having a formal, you know, on the Bloomberg are going to be CPI or CPI for CPI XM and Low Park. Yep. That's the kind of data that we need. I mean, there's also a $10 billion tender offer going on at Open AI. So, you know, if you're in the market for San Francisco. Yeah. Somebody, somebody was running the numbers and showing that there's like,

there's, there's only, I think, a few hundred homes that are in the, like, four to $10 million range in the in San Francisco and and and and so imagine you just flood the market with like 10 billion dollars yeah fresh cash and you get a bunch of cash buyers I mean uh last question we'll let you go there's something in the chat someone's talking about the u.s. open which i guess is uh u.s. what's the u.s. i heard of it. Is that like open open open operations? United States open. Yeah. Oh, open. Yeah, maybe uh, something like a real estate company. Maybe it has something to do with that. Yeah.

Anyway, yes. But do you have a prediction? They want to know, they want to know if you're watching tennis and if you have a prediction or favorite. Who are you rooting for?

I know. I'm so embarrassed every summer I try to get into tennis. And I actually take a few tennis lessons every summer and it's like, this is the air, I'm going to go to the US Open. This is the air.

I'm really going to pay attention. No, I said, you have nothing to, despite my efforts year after year, once again, nothing positively contribute to this district.

Yeah, me too. I have no idea. But hopefully I will see some more. great capital allocators, photographed and paparazzi shots. That's what I watched the Open for. I watched the paparazzi feeds.

As do we all. As do we all. Joe, enjoy your afternoon. We love you. We'll talk to you soon. Talk soon. Talk to you soon. Bye.

Bye. Legend. Did you see that? Yes, it's a purpose of built tool for planning and building products. Meet the system for modern software development, streamline issues, projects and product roadmings. start building with linear. It really is a crystal ball for your roadmap.

Yeah, it is. Anyway, what did you see? This is interesting. Guido Reischdottor is doing a hunger strike outside of Anthropic. He said, hi, my name's Guido. I'm on hunger. He couldn't get in? He couldn't get in to the SPV.

He said, I'm on hunger strike outside of the offices of the AI company, Anthropic right now because we are in an emergency. Anthropic and other AI companies are racing to create ever more powerful AI systems. These AIs are being used to inflict serious harm on our society today. And about rate limited? Why is it? Inflict increasingly increasing. We'll get to that.

I think it's very likely that he's hitting rate limits on pro plan. That might make sense. And threaten to inflect increasingly greater damage tomorrow. Experts are warning us. Okay, we're going to trust the experts here. experts are warning us that this race to ever more powerful general intelligence puts our lives and well-being at risk as well as the lives and well-being of our loved ones. They are warning us that the creation of extremely powerful AI threatens to destroy life on Earth.

Tyler, what you got? So I think it also could be, you know, Dario just said they're not selling AI to China anymore. So he might just be, you know, SPV holder and he's, you know, mad about the province. Yeah, less revenue from not selling internationally. That makes sense. I mean, this is incredible marketing. the company you can't really take out a short position and become an activist. This is incredible marketing for anthropic. Yeah.

Do you think this is some sort of like mischief style stunt like to promote the company? Yeah. If you, yeah, you need to get protesters. It's so funny to single out anthropic, the most safety oriented. Yeah, they are the most safety oriented. Like why not? It's just like. Like XAI is like we will just put everything out.

Like, it's, it's, uh, it, it, it, it, it, it, it, it's, uh, it, it, it's, uh, it, it's, uh, it, it's, uh, it's, uh, it's, a lot of, lot of, buzzwords in here, uh, uh, power, power, power bottom dad says, this is so crazy. I'm kind of for it. Yeah. Does the, does the, does the post look one shot at all? Orio says, bro, you're on a fast. If, it's good for you. If you get to seven days, it'll do wonders, wonders for your health. is this bodybuilding related people are just responding to his post with pictures of their food

okay oh that's so mean wait but are there any um dashes in the post zero m dashes it's not this it's that nothing like that okay I mean it basically says seems like pure the same thing over and over and over okay

I wish he put this into Claude and kind of like what is his name Guido Reich Reichstadt, Reichstadtter. Well, good luck to him. Hopefully, he dries out and cuts down on the body fat, gets extra diced. We, you know, say it's bulking season, but it's not right for everyone.

Some people got to cut. And no better way to cut than go on an aggressive bath. So he is the co-founder of a company called Stop AI. And he has one connection on LinkedIn. Stop AI. Oh, you're connected to him. No, no, no, I wish. Okay.

His only experience on his LinkedIn is at Stop AI. Has he stopped anything else? Yeah, it'd be crazy if his last job was like, co-founder at like Stop NFTs. Or like stop time travel. He's like, I was successful. We don't have time travel. Stop teleportation technology.

Stop hypersonic planes in America. There's not much on Guido. He is interested in LinkedIn news, according to his interest on LinkedIn. Interesting. Well, one AI you should not stop is putting your sales tax on autopilot with Numeral HQ. Sales tax on autopilot. Spend less than five minutes per month on sales tax compliance. Go to Numeralhq.com. On the more optimistic side of things, everyday astronaut has been reflecting on the Starship program over the last week. And one thing has become obvious to him. This is from Everyday Astronaut, a fantastic space-related content creator.

He says, SpaceX is enjoying the freedom to try and fail in a way they couldn't with Falcon 9. Doing anything experimental on the Falcon 9 was risky because it was SpaceX's only source of income. It was their lifeline, their workhorse. Making any tweaks to the Falcon 9 to try and land a booster back in the day was a delicate balance. Don't push the envelope too hard because it could lead to a failure of the primary mission, which did happen twice. Yes, I believe that they blew up a satellite that Facebook was putting up. It was very dramatic and kind of foreshadows the showdown and the potential MMA fight. But of course, like they have a contract and I think the money flowed appropriately.

The companies weren't actually upset at each other. But it was kind of a crazy crossover moment in tech. Anyway, everyday astronaut says when SpaceX first landed a booster almost 10 years ago, they were fairly slow to refly. And those first non-block 5 boosters were only capable of a couple of reflights. This gave pause to some of the industry slash community, fearing all of this reusability hype wasn't going to pan out. But SpaceX learned from every landing attempt

to develop their Block 5 Falcon 9, which has now gone on to have a single booster, fly 30 missions, absolutely unheard of. That's wild. Now imagine if SpaceX could have had the freedom to not worry about flying customer payloads to get data during Falcon 9's reusability campaign. Imagine if they could have tested engine out procedures

or push booster reentry profiles, or try hot staging or what have you. This is the phase that SpaceX is now in during the Starship program. I know we hear the talking point of, quote, today's payload is data and it could seem like a gimmick or excuse even, but that's a freedom almost no rocket program has had before. To know you can just try things out, fly real life hardware without bankrupting the company

is the ultimate development platform. To be able to push engine out capabilities, remove heat shield tiles on purpose. We saw that with the video. It's like this crazy, like, garbage floating around. They removed heat shield tiles. The thing barely made it back because they're pushing it to the absolute limit. They're not just trying to reach orbit.

They're trying to do something that's never been done before. Build a rapidly reusable rocket, a rocket that can land and refly. This could have never, this has never been done before. And honestly, it's silly to think you could do something like this without trying some extreme things. That's what we're seeing today. And that's extremely exciting to me. I can't wait to see version 3 of Starship Fly because they've learned so many lessons already and they have a factory capable of making rockets at scale and we just get to sit back and watch

the cook. It's an exciting time to be alive. Kitchen's open. Kitchens open. They're cooking. Anyway, you want us to take us through the next few timeline posts, Jordy, what you got for us. Absolutely. I just feel bad because we kind of glossed over some of Alan's tree. trades. 2021, bought a house and carp for 70 million. Sold it for 96 million two years later. Wait, Carpenteria?

Yeah. 96 million. That's a huge number. Wow, that must have been. Another one, bought a house for 7 million in 2017, sold for 11 in 2018. Yeah, these are great. Another one bought, re-bought a house for 14 million in 2021. Re-sold it for 2021.

Or, sorry, 21 million in 2023. And some of these are so, so quick. You know, buy in 2025. sell in 20, 25, $10 million gain. I mean, she's just pushing this. Homeby Hills. Same year. She bought a house for 20 million in 2022, sold it for $36 million in the same year.

That's great. An absolute dog. The Usher House. Usher listed the home for sale for $35 million in July 2019. We just can't quit the mansion section today. Should we talk about the house of the month? What else is in here? Why don't you call Eric right now?

Oh, yeah, okay. He's ready. Yeah, well, let's get Eric Gleiman on the phone. I got an important question for him. Yeah, we saw the news about the billion dollar run rate, and we just had one question to ask. Let's get Eric Glyman, the CEO of Ramp, on the phone. Hey.

Eric, how you doing? You're live. You're live. We're live. What's going on? Give us the update. There's some milestone that just dropped yesterday, I believe. It is, we couldn't be happy.

Your ramp is now doing more than a billion dollars a year in revenue. Let's go. Congratulations. I just have one question. Is the job finished? Jobs not finished, guys. Not finished. Just getting started.

Fantastic. Well, I'll let you get back to work. Thank you so much. Thank you for calling in. It's great to hear from you. All right, cheers. Have a great weekend. You too.

Talk to you soon. Bye. It's not. the weekend yet. It's not the weekend yet. Mark Hannes has got a buddy from high school who's on his fifth AI startup in two years. No technical engineering background. He's an MBA. Hires engineers with a low budget to do all the work and build the product while he is CEO and manages. Just started a new AI education startup. Wish I could short. I wonder how this will pan out. It could work. I don't know. Depends on exactly what he's doing, but it certainly is not the YC path, not the

make something people want. It is a very management consultant, very MBA-coded strategy. Yeah, good luck getting into YCE with this strategy. Good luck. Good luck. Naval says if your smartest friends start saying crazy things, pay attention. A paradigm shift

may be underway. I think he's talking about people getting one-shotted. You think that's it? Could be. I don't know. It might be, you know, he might be talking about AI, right? You have really smart friends and they start saying crazy things. They discover new physics.

Yeah, all this other stuff. Not that, not that. But actually, like, you know, the idea of superintelligence is a crazy thing to say. But it might be real, you know. It might be real. And it might start in your customer service organization with fin.a.i, the number one AI agent for customer service. Number one in performance guys sparks, number one in competitive day talks, number one ranking on G2. So we covered the jobs gains.

They were all part-time. Full-time jobs dropped by $356K. Part-time jobs grew by $597K. Certainly not good for the durable, long-term, healthy economy. But earlier this year, there was a massive gain in full-time employment, and then that dropped. And so there seems to be gyrations which way. But anyway. Yeah.

Crazy story. Coming out today is SEAL Team 6 in 2019 attempted a covert mission in North Korea to plant a device to intercept Kim Jong-un's comms. They should have just waited and got him a friend.com. Just say, hey, this is going to be your new bestie. Just wear it. Keep on your person. That work. Authorized by Trump, the mission failed when SEALs unfortunately killed civilians mistaken for security forces. get into the story a little bit because we don't talk about politics, but we do enjoy geopolitics. In early 2019, Trump approved a clandestine seal team six operation to planet advice in North Korea to intercept Kim Jong-un's communications. Red Squadron known for killing Ben Laden rehearsed for months. The mission aimed to gather intelligence during nuclear talks.

This was the nuclear Trump and Kim Jong-un had been communicated. educating around Obviously North Korea's nuclear program on a winter night seals emerged from the sea near North Korea's coast a nuclear submarine deployed two many subs carrying eight commandos Lacking real-time drone support they relied on delayed satellite images the shore appeared clear But a North Korean boat emerged Mistaking civilians for security forces the seals open fire killing two or three shellfish divers so apparently they were on the beach a boat pulled up started using lights they just assumed it was security forces ended up being fishermen and anyway so apparently the trump admin at the time didn't notify Congress

and the seal sank the bodies abandoned the device and signaled for extraction the submarine risked exposure retrieving them in shallow waters North Korea detected activity but made no public statement the mission's failure hidden by secrecy, risk escalating tensions from a nuclear armed state. Military reviews justified the civilian deaths under engagement rules claiming unforeseeable errors. The Trump administration withheld details from Congress, potentially violating federal law. Many involved seals were later promoted despite concerns about special operations

uneven track record. It is fascinating that, so the disclosed TV, talked to 24 anonymous sources, including Trump administration officials and military personnel with direct knowledge. Their anonymity reflects the operation sensitivity. It is obviously a tragedy. But it seems a bit hard to hold special operations teams and say you have to have, you can't fail if you want to rise up in the organization. Sure, sure.

Right. But yeah, I mean, obviously you want every operation to be executed flawlessly. Anyway, in other news, the Washington Post is now on substack. Let's hear it for the Washington Post. The Washington Posters. Jeff Bezos is... They heard you can post... You can post notes on substack.

They said, we got to get involved in this. We love posting. We love posting. It's in our name. Posters. So this was, I believe, a story that was broken by Emily Sundberg in Feed Me, and she did a little bit of an interview here. Let's see, welcome to my life, says Rachel Tashian.

And Emily asks, how do you see the Washington? posts game plan on Substack playing out. Is there something that will make your strategy different from other legacy media brands that have joined the platform? I'm actually not that familiar with other legacy media brands that have joined Substack. Are you subscribed to any? And Dresen Horowitz.

Specifically a new media brand. At this point, they've been doing media for 20 years, though. That's what I'm saying. That's what I'm saying. Play the shots fired. No, I'm just, I'm just, I'm just joking around. No, we are the legacy media. They are the new media.

We want to be legacy media. I don't, the Washington Post responds. I don't necessarily see Substack as an alternative to legacy media. I see it as an additional tool to experiment with in a fantastic way to connect with new readers. I love getting into the mix in the comments, comment section, yep. I think a successful journalist in 2025 should be on as many platforms as possible and have a tailored strategy for each one. Completely agree. So it was important to us that we publish original content.

exclusively on substack and really engage with the platform on its own terms. I consider post-runway, something like opulent tips, goes to Milan and Paris. I don't report from the chiffon trenches, as Andre Leontali lovingly called the fashion world for my newsletter. So now I'm going to bring a bit of that madcap approach to the access-driven reporting and criticism I do for the paper, and I'll still be doing all my usual reporting and runway reviews for the post. will there be a paid strategy, asks Emily Sundberg in Feed-Bee?

The Washington Post responds. Post runway will be free. Woo-hoo! What does success on Substack look like for the Post, says Emily. Having fun, opening the Post world to new readers and introducing the amazing voices on Substack, especially fashion writers, to the Post's audience. Well, welcome to Substack, the Washington Post.

Maybe we should do a collab and talk about fashion. I don't know. I mean, I'm dressed to the nines today. I'd love the Washington River post. Yeah, praise the invite. To review the wonderful yellow suit. And we got to give it up to Sierra. Yes. And they're raising some new capital. $350 million from Green Oaks. Okay, doubling down Sierra at a $10 billion valuation. And Zach DeWitt is saying, including. credible seed investment for benchmark. They likely own 15%.

It's a $450 million fund. Let's go. Three to four X are ready on one investment. We love to see capital allocators win. Goat emoji. Congratulations. Jobs not finished, but certainly a fantastic milestone. Power Bottom Dad says,

quoting Joe Wisenhall's post saying the U.S. has lost 78,000 manufacturing jobs this year. That is a lot. Is this reindustrialize? I'm kind of tired of winning. You would, I don't know. It's hard to, you know, Joe's point, which is real, is that you can't expect things to have an immediate impact.

Yeah. But at the same time, if U.S. manufacturers were feeling good, had lots of business, they would probably be trying to keep as many people as they can. There are two economic statistics that I find important in measuring the progress of reindustrialization or industrial might. The first is jobs. Manufacturing jobs are important. It's the, you know, in many ways the heritage and the backbone of the U.S. economy, although the U.S. economy has shifted to a services-driven economy.

But if you want to measure manufacturing capacity, it is fine to just use GDP. what is the total value of all the goods that are manufactured in America? Is that going up or going down? I actually don't know the numbers off the top of my head, but when I think about the next, I was talking to someone who was saying that America will re-industrialize, but it will re-industrialize on the back of robots in automation, and there will be a much higher leverage for each individual manufacturing worker.

You've seen this with companies like Hadrian. There's not that many people in the, that facility for a lot of CNC machines that are basically automated. And when you look at, you know, who are we actually competing against? If you're benchmarking the United States against China, yes, China has a ton of people that migrate from outside of Shenzhen into the manufacturing hubs to assemble iPhones during the push. They bring in a million migrants to assemble iPhones right before the new iPhones released. And China obviously employs tons and tons of manufacturing employees.

But at the same time, they also have lights out facilities where everything is effectively automated. And when you look at the way at the design of the latest Tesla factories, the design of the latest Starlink factory, we are making things in America, but we're doing it at a much lower level of headcount. And the headcount... And some of our best manufacturers aren't contract manufacturers, right? there. True.

Elon companies. Yeah. Vertically integrated. Yeah. So. But over time. There was also, there was a crazy story

from the BBC, which I think stands for business, business central. Business, business capital. Business business capital. That's what I like.

They said, this was basically breaking live over today. Almost 500 people have been arrested at a Hyundai factory in Georgia by immigration authorities. And what they, South Korean?

So a majority of those attained at the 3,000-acre site, which was built by the Korean automobile manufacturer to make electric vehicles, are Korean nationals. That's very interesting. So South Korea's expressed concern and regret over the operation. Yeah, very odd. Which is kind of interesting dynamic to just be like, yeah, we regret that because it's the government. I mean, it's South Korea saying that.

Sure, sure, sure. Not Hyundai. You think Hyundai would be like, sorry. because this scale is... Got to sort out the visas, guys. You know, I think everyone's all four. Like, bring the TSM's semiconductor experts to Arizona,

but make sure that they fill out the immigration paperwork. Yeah. If they're going to come over here and build. Anyway, Bucco Capital Blokes says, perhaps we are moving to the find out stage of paralyzing the U.S. economy with a multi-quarter barrage of nonsensical inconsistent and conflicting

set of economic policies. And there's some people in the chat. Is this bullish? No, this is not bullish. He's blackbilling. He's very, he's very upset about the economic data that was printed today related to a lot of the economic policies, mostly from the tariffs. Alps has a post showing the Las Vegas sphere, saying it's looking a little bit different. This, to me, is this, is this super intelligence rearing its head? I love that Ilya is leaning in to the bit and having fun with the having fun with the hats and whatnot.

Wasn't there another hat? Oh, yes, Pixel Hulk. Pixel Hulk says they now have a new line of Mark Andresen merch. And it's a hat where the head looks like Mark Andresen. This looks like this is like a fantastic AI image. I imagine this is AI. It looks like some sort of however they made this, whether it's Photoshop or AI.

flawless. I do think this would sell pretty well. It is ridiculous looking, though. TBPN was featured at Volta. Oh, yes. Earlier. Theo did a photo shoot. There's a Ferrari in the picture, which we love.

And I believe one of Volta's employees. And anyway, shout out to John Fierntino. I can't wait to visit the Volt hit. In Nashville. be great the flagship it's not even in the HQ this is the flagship store right the flag this is this is the you got to make the pilgrimage yeah um um we covered uh tempo the new l1 built by uh stripe and paradigm so we don't need to cover it again but mert was uh firing back uh in in the announcement they were um uh the tempo team was basically

highlighting potential limitations from existing L1s. They highlighted transactions per second. They highlighted moments that you couldn't run payroll. Again, if you were trying to run payroll the day that Trump coin launched, so Trump coin launched in Solana, is that right? Not Ethereum. Because I know Ethereum, the narrative around Ethereum has been like the networks congested, there are high fees, but that was the whole idea behind launching.

was that it was going to be much more scalable and there was some sort of trade-off there. And then this is like the next L-1 and people are upset about it in kind of both camps. But I invited Matt on the show and Mert, who were both talking about this, would love to. Yeah, and they're going, they're happily running a little bit under the radar. Now, Mert said, guys, you can just say you want more full-stack control and distribution. You can also say you want the L-1 premium or a controlled validator set. these are perfectly legitimate answers, but you look unsurious and hurt your brand when you start talking about scalability and defending the Solana blockchain.

Yes, yes, yes. It is proven that it can scale. But, yeah, I mean, I think this kind of play makes sense. Of course, Stripe and Paradigm would want to own the rails effectively, even if it's going to be network-driven. Yeah, and it does seem like Stripe has a. large enough customer base so that they can actually bootstrap the network fairly, fairly easily, right? But just offering it baked into checkouts that are already powered by Stripe potentially. Although, I wonder how, like, what the onboarding process is like, because even just getting a

Solano wallet set up, it's not as easy as like, oh, I have a different credit card. And so the same Stripe form works the same. Maybe you wrap it in a credit card. I don't know. I still don't exactly understand where tempo fits in the full stack and how this gets rolled out. But I'm excited to learn more. I mean, we'll certainly have some folks on to talk about it. More importantly for some members of our audience, Mercedes-Benz is teasing the return of the four-door soft-top cabriolet G-Wagon.

This is the moment that many of us have been waiting for. Yes. G-wagon, arguably, greatest car ever made. They have done many iterations of the cabriolet over the years. I came close to buying one

a couple times from my friend Blake, who has a company called Found Objects here in L.A. He sources these incredible G-waggons from all over the world. And anyways, I'm super happy that they're bringing this back. this image that is pulled up on the screen right now is actually I think somebody taking some artistic liberty the actual image we can pull up here if possible I put it in the timeline but the actual

image is blurred out on the official Mercedes account and so I expect this to be like somewhat somewhat different than the picture that we just had up on the screen. What's crazy about this is that... I just expect them to modernize it a little bit. So Mercedes has a G650 land delay, which is the soft top four door, but it's a Mibok, and I believe it trades at around a million dollars a car.

Can't believe anybody would sell that for just a million. Yeah, this is. Yeah, so this is the image that they posted on Instagram. and anyways I'm super excited for this I wonder how limited it'll struggle I will definitely struggle not to acquire this John John puts a lot of pressure on me to not just continue buying G wagons to mix it up you gotta mix it up it is I think I think if you want a convertible even speeder speeder speeder drove my G the other day and said you know what I thought these were ever hipes but I get it I get it now get it but if you want a if you want a if you want a four door convertible SUV, why not get a Nissan Morano cross Cabriolet? It's actually a two-door. Yeah, but if you want a two-door. Yeah, if you want the four-door, yeah, you kind of have to upgrade from the Nissan-Mirano cross-Cabriolet to the G650 Cabriolet. It'll take you from maybe $20,000 to maybe $2 million, but, you know, you do get those extra two doors. So, yeah, I think it's a pretty

clear value there. I cannot wait for this. Do you think the, G-wagon salesman should be on Adio, customer relationship. They absolutely should. Adio is the AI-Native CRM that builds and grows your company for the next level. You might be tagged as just already closed one and for some G-Wagon owner in Adio

and they put you right back in, reach back out with the next one. It certainly do for me. They certainly do. As soon as you move into closed one, they move you back into Prospect. Yep, back in the pipeline. Back in the pipeline. Oh, Sergei Bryn was at the dinner last night with Donald Trump,

and Google is back in founder mode. You'd love to see Sergei having to seat at the table again, says Beth Jay's house. This post from T.J. Parker was absolutely insane. Insane. We got to have, we should, we should call TJ right now and ask him to explain himself. So he says, fun facts. I was the youngest VP at Amazon. Of course, he sold Pell Pack to Amazon for $1 billion.

He said I was the youngest VP at Amazon. I've also personally never bought anything on Amazon, which is just absolutely incredible accomplishment. How do you live your life without ever buying a single thing on Amazon? It's a crazy book. I think what he said, I think he just, I think he just said if he likes something,

he sends a link to his wife and then she buys it. Okay. You still have Amazon purchases. He was too. poor and then too rich and then he was too rich. Yeah, maybe. Yeah.

I mean, like, really telling yourself for not taking the gig seriously, T.J. It's like, you know. Well, he was focused on something else. I mean, like, he was focused on something. I guess, but, you know,

I just think like, like, if you get a job at Apple, you're expected, it's polite to wear an Apple watch, you know, you walk around Apple HQ, Cupertino, like everyone's wearing Apple watches. They're not wearing Samsung, on Galaxy gears.

You know, they're using the product. If you, there's a, there's a famous story about if you are trying to sell a piece of software or any, do any sort of business

dealing with Nike, when you go to their headquarters, you should be wearing Nike's. You do not show up to Nike headquarters in Adidas because they will see that, they will take that as a, as a sign of disrespect to their culture. It's like if we get,

if we get lunch or breakfast with somebody and they insist on paying and they don't pay with a ramp card, I was about to say. It's a very big sign of disrespect. Very big sign of disrespect. I'd rather just have you not pay at all. But very, very silly.

And I guess, you know, evidence that he was ready to move on and get into the world of investing venture capital at Matrix, where he is now. Tim Cook has an iconic photograph in Getty Images. He hit the Abbey Road, says Mark German on the way to meet Trump. You love this. He is flanked by a crew of what appeared be bodyguards or maybe just the boys, maybe just the homies.

But it's a good good picture. One for the one for the tech, the museum of business history. We talked about the this. Oh, we should go into this fabricated knowledge post. So I'm going to let you cover this. Yeah. So Doug O'Loughlin has this thesis. He says, I think lagging edge is going to be, is going the way of solar panels.

Some can win, but the aggregate, the aggregate big knowledge. number of chips is going to be bad. And so, it says, first up is Texas Instruments. Where does he say this? April's pop is mostly pull forward. The lagging edge price war. Lacking edge capacity now behaves differently. Another upturn may come, but it may be muted and prolonged. Something is broken in auto and industrial. Texas Instruments is right to run inventories down. They likely will not need as much. There's a lagging edge permaglut, he says. What no one wants to admit, Lacking edge capacity may be structurally different now. Earlier, I argued prices had to rise because new fabs cannot profit from selling

lagging edge chips at prices set by a fully depreciated fab. There are obviously pricing problems in this scenario with a new fab. A company can't turn a profit by selling lagging edge chips at a price that was previously dictated. Reality. The lagging edge took price in a temporary market upturn. Now we are reverting to the mean the old treadline is back. There's no meaningful new demand for old nodes.

And what exists is made and consumed in China. So you go and you make the smart toaster or the smart dishwasher and you need a chip in there. You don't need a TSM 3 nanometer TPU and video chip. You just need some lagging edge chip. It's going to be made in China. It's going to be assembled in the product in China. And then you're going to get that smart toaster delivered to you. And all of that's going to happen within the Chinese ecosystem.

And so if you're running a lagging edge fab in America, Doug O'Loughlin thinks you're in trouble. The COVID super cycle plus a new China supply line that does not care about capacity economics points to a forever glut. China has a long record of flooding the low end. State-directed CAPEX boosts output at the expense of efficiency. Doug wrote about this involution dynamic recently in China's race to the bottom. products at 90 nanometer and above should internalize a permanent China glut. Companies resist that conclusion, but the case studies are familiar. Solar modules, LCDs, LEDs, steel, shipbuilding, batteries.

You've seen it time and time again. China wants to stay on the lagging edge and dominate there, the commoditized lagging edge, and not worry about, you know, and they see that as the learning curve to get to the leading edge, but they are willing to sell at a lower margin for a very long time if they need to. Companies can still win share, but through performance and packaging rather than by producing older chips at lower cost, ADI is a masterclass in adding capabilities. MPWR has focused on higher end power. The long tail will face a flood of Chinese supply.

Good luck to the older fabs. I cannot resist. Talking about Marvel, Marvell behind the paywall. So head over to Fabricated Knowledge and subscribe to the, substack. And we will have Doug O'Loughlin on the show again soon to dig into all of the dynamics of both the leading edge and the lagging edge. So Josh Steinman, famous for saying we are good morning we are going to win every single day. Has a post here that's not good morning. We are going to win. It says you versus the guy she told you not to worry about Robotoxy versus

Waymo service area in square miles. So Waymo has been on a very consistent grind adding square miles every year for the past seven, six years, gone from maybe 50 square miles to now 750 square miles, whereas Robotoxy went from zero to almost 1,000 square miles in just under a few months. It's hard to make an equal comparison here based on the single metric. Obviously, I'm super excited about both companies, but. And still in beta, but the app is. doing very well with Robotaxi.

We will see the... Number one in the charts. A little bit of a narrative violation. It turns out... Maybe made a phone call of Tim Cook, and Tim Cook said, thank you, Elon, for getting us to space. Thank you for... We'll put you at the top of the charts. Thank you for Starlink. Thank you for the Model 3. Thank you for the Model S. Thank you for the Model Y. Thank you for the Model X.

Thank you for the cyber truck. Thank you for the roadster. Thank you. For the Falcon 9. Thank you for the Merlin Engine. Thank you for the brain chip. For the neurolink. Thank you for buying Twitter. Thank you for building that tunnel in Las Vegas. Thank you for PayPal.

Thank you for Twitter. Thank you for Anni and Valentine. Tim Cook definitely said thank you for Ani and Valentine. And Elon said, cool. You can have the Robotaxy app on iOS. Anyway. How did you sleep last night? Oh, you know I slept.

You slept like a log? I wish 71, only six hours. 85, play the song. Let's go. 85. Thank you, Jordan. Travel days. Travel days are rough, yeah.

Rough. Go to Aidsleep.com, get a pod five, five-year warranty, 30-d-end risk retrial, free returns, free shipping. And you can use code TBPN. This was cool. Yep. So this, I mean, this was just a cool move in the history of capitalism. Yes. Alte Cap says, didn't notice this until today.

Another shareholder died. This is a Japanese company and donated their shares to the company. Whoa. Which was 6% of the outstanding shares. Their Will also donated their real estate to the company. Yes, yes, yes. And Sleepwell said, oh, you think buybacks are cool? How about major shareholders dying and donating their shares to the company plus some real estate for free?

Tyler, we do expect you to put the iPhone that we gave you in your well, to TBPN and we passed down to another intern in 50 years. There's a funny contrast, I think yesterday. Let's not make the call. 100 years.

50 years. What is Cijian Pink think he'll live to? 150? 150. So that's like 145 years from now for you? Exactly.

But there was a post yesterday. Well, yeah, what is this carrot? Oh, the carrot in the stick. Oh. Yeah, the carrot on a stick. No, they shouldn't be on the same. It can't be attached to each other. You put the carrot.

You give somebody the carrot or a stick. Have you ever written a horse? You put the carrot on the end of the stick, and then you hold the carrot in front of the horse's nose, and then the pull-up- Oh, I'm more, I thought we were talking about the phrase. You're correct. Bring the carrot or the stick in a negotiation.

Yeah, yeah, yeah. But yes. Okay, we got to, yeah. So the next time we see Donald Trump doing a 4D chess negotiation, we're doing away with the chess analogy, and we're moving to the carrot and the stick analogy, and we now have a physical prop for both the carrot, the stick.

Okay, but I was going to say, yesterday I think we sent a post about there was some billionaire who is leaving his will to Namar. Oh yeah, that's in here. For Namar. Yes. I love that. So interesting contrast. Yeah, wait. Who is Namar?

Something with like a ball. He's an athlete? Yeah. He plays soccer. Is this just some crazy way to get around salary caps? A businessman is leaving $1 billion to Namar in his will, the administrator justified that he identifies with the athlete

and decided to give his inheritance to the player. I think if Steve Balmer really wanted to get around the salary cap, he would, you know, commit ritual of suicide and leave in his will is his money. That is the final boss of salary cap evasion. It's just to just to just get a number. extra. You care so much about your team. Well, in some other news that we will have to track the will of, very sad news. Georgio Armani has passed away. He was 91 years old. He was the creator of the power suit. He held the reins as conglomerates rose. Georgeo Armani, the designer and

business mogul who brought subtle Italian luxury to the world stage and conquered Hollywood died at 91. He worked until his final days, dedicating himself to the company, the collections, and many ongoing in future projects, said an announcement by the namesake brand. The company later confirmed he died in his home in Milan. During his years at the helm, he remained steadfastly independent in a fashion landscape dominated increasingly by conglomerates. Although he disliked the moniker, Armani was often called the king of fashion in an interview with the Wall Street Journal in 2024 just one year ago. He insisted that the secret to success

was his humble, consistent work ethic. This guy has Founders' podcast episode written all over him. He owned a super yacht and homes in New York, Milan, Pantillera, Antigua, Paris, San Marit, Saint-Cropay, Forte de Marmee, and Brioni.

But he showed up at the office every morning and ruled his empire with a firm hand. He has TBPN mansion second. deep dive written all over him as well. Armani, who called himself a designer businessman was the sole shareholder of his company at the time of his death.

Wait, I had no idea still. In 2023, its worldwide revenue was $2.6 billion across men's and women's lines, the Emporia Armani diffusion line and Armani Privet, Hout Couture, interiors, dozens of restaurants, 2,500 retail stores, fragrances and a cult classic beauty line, whether it took the form of relaxed

suiting, makeup, or interior design, his work whispered refinement. His stylistic innovations included an emphasis on neutral, in-between colors, soft shoulders, and a more relaxed approach in-between colors as I read this in a yellow suit. Not exactly an in-between color. You know it's not from Armani. He often drew inspiration from... He still would have appreciated the ramp. ramps, I think you would have, I think you would have.

As a designer businessman. Yes. He often drew inspiration from Asian culture in his work, Akira Kurosawa's 1980, a eight, let's say about A8, film called Kagamusha inspired his fall 1981 samurai collection. I love that he has this balance of softness and power, said Armani's fellow designer, Michael Coors, at the last New York runway show in 2024. Armani became a household name where he designed Richard Gier's suits in the 1980s movie,

American Gigolo, from the 1980s until recent years. He was the go-to designer for red carpet looks dressing Oscar winners from Jody Foster to Kate Blanchett. In 2024, Armani stressed the extremely important role of independence played in his impact. It's not a question of pride, he said. It's about getting things done. When I have an idea, I want to see it through to the end. He set up a trust in 2016 that laid out his plans for his company, including a charitable foundation, and details for how a public stock listing or an acquisition would be handled. He worked with a close circle of collaborators, including his sister, Rosanna, who is on the board, his niece Silvana, who is the head of women's design, his niece, Roberta, the head of VIP and entertainment relations, and his nephew, Andrea, uh,

Camerana, the sustainability managing director. His right-hand man and close friend was the head of menswear. Born in northern Italy, the town of Piacenza, on July 11th, 1934, that's what, 200 years before Tyler was born. Armani was the middle child of three siblings between older brother, Sergio, and younger sister Rosanna. Armani described his childhood marked by a fascist regime in World War II was hard scrabble. At nine years old, he was standing out. inside a movie theater looking at a poster for Snow White when a friend came across an unexploded shell of gunpowder. It caught fire and the young Armani burst into flames. He said he shut his eyes only to open them 20 days later in the hospital. This is crazy. Well, there, I know we have our

next guest, but I can't stop reading this one second. We're sorry. We have the CEO of Scalia Eye coming on just a minute. His only lasting scar was on his foot where his shoe melted into his flesh. The incident contributed to Armani's desire to become a doctor. He attended medical school in Milan for three years before dropping out to fulfill his compulsory military service. After the army, Armani's latent creativity was stirred, he began working as an assistant architect, designing interiors and displays for a department store in Milan. He moved into menswear working for a time at Hitman, a company owned by Nino Ceruti, and freelancing for other brosings. And freelancing for other brands. By the mid-1960s,

Armani met his long-time life and business partner, Sergio Ghaletti, a Tuscan architectural draftsman, 10 years his junior. Galetti persuaded Armani to start his own business in 1975. He woke me up from a sort of torpor, from the little life in which I was living. Armani told the journal in 2012. John, is amazing. I hate to cut you off.

Let's not keep our guests waiting. Let's not keep our guests waiting. Although that is a fantastic story. Welcome to the stream. Bring in Jason. Sorry. John was getting carried away there. Have you heard the story of Georgia Armani? He just died.

And what a fantastic obituary in the journal today. No, I was hoping you'd keep going. That was great. Sorry to keep you waiting. Great to me, Jason. Thanks for coming on. Thank you so much for helping on. Yeah, nice for you guys.

Why don't you kick us off with an introduction and kind of your path to how you wound up in this particular situation? Yeah, totally. So I've been in tech for a long time. I've been at scale for a year. My background has been in starting companies early, early in my career, onto, you know, more notably at Uber. I sort of the Ubreeds business there. And that grew, you know, much larger than we ever thought it would.

How big is the, how big is that business today? You don't mind me asking. When I left, it was about $20 billion a year of GMB. Sorry, I need a reason to hit that. I think they've grown it to maybe $70 billion. It's 70, 80 billion. It just keeps going. Yeah.

Dara just announced yesterday that in Australia alone, they've served a billion deliveries, which is about two billion meals. So, you know. That's a lot of shrimp on the Barbie. You know, when you get involved in these things, you're always surprised at how big things can get. And I think that's going to end up being true here with this current wave. Yeah.

And that was one of the reasons why I was excited to, you know, join scale a year ago, joining Alex at the same. time. And, you know, I'd experience in marketplaces, done a lot of gross stage businesses, things where demand was outstripping supply, and you needed to fix a lot of things to get the business on track. And, you know, it's been an exciting, super fascinating journey over the past year. I mean, nothing like I ever expected. Yeah. What was the shape of the business when you came in? Like, from my perspective, scale has been a very interesting business in that it hasn't, like, Many companies have a second act.

I feel like Scales at a second and third, maybe even a fourth act. The way I tell the story is, you know, Alex Wang is starting with creating data for self-driving cars. Eventually that business maybe gets rolled into Waymo and Tesla directly. And so scale expands into the RLHF boom during the LLM boom and is kind of grown. And then my question was, are we going to see scale? I take on robotics data or more specific tasks. And so describe the shape of the business when you joined and where you were thinking about taking it. Yeah, no, for sure.

I mean, the history is amazing and fascinating. I think Alex had this insight that data was the most important thing to models. And that was nine years ago. So that's very visionary. And I was very impressed whenever I was talking about a role at the company, you know, only a year ago. And you're right, we've gone from different types of data. And one interesting thing about like this entire journey is that every single type of data, someone has said like, oh, when is this going to go away?

When is this going to go away? When is this going to go away? And this is a common thing that we hear. And we've heard it so many times that, you know, we sort of are used to addressing it. And there's always some other source of data. And one of the reasons why is because data is the application in many years. ways. You know, you're going from a software space where it's software organizes data for use by humans. Now you've got data driving applications of things. And so as we generate more and more data,

the models are serving customers. Those customers have higher and higher demands of what the model should do, which then drives demand for more data. And the data changes. But, you know, we've gone through this so many times from expert data. to, you know, now, you know, models are working on, like, how do they do things for you, right? It was about knowledge capture, and then now it's about skill capture. Yep. So, yeah, it's been an awesome journey. And the company has been extremely agile and extremely commercial over the entire journey, which is, you know, which leads us to this discussion.

Yeah, it hasn't just been just like, like, if you zoom out, it's like one smooth sort of exponential. but in fact there's different pools of data that have been maybe a series of stacked S-curbs, but that's the story of all technology and all progress. So I'm interested to know what, like, when Alex did invest like the best, he had a very interesting point about robotics data being particularly rare. Like at least we had the internet to crawl and scrape, and that was something that didn't, it eventually needed to be polished with RLHF, but with robotics data, there's just so little out there.

And I was wondering if that was something that you were interested in looking at or if it was immediately the skill capture thing of these really, really niche experts, people who know about archaeology and it's just not on the internet, and you need to go get some PhD, get them on the platform, and start having them answer questions so that that can get baked into the models. And we can get out of the, what is it, like, Gellman Amnesia, or Dunning Kruger for these models where it sounds great until you're asking about the thing that you're the expert in.

And then you're like, oh, actually, it's only at a college level. It's not actually at the full expert level. Right, right, right, right. Yes. So, yes, we do robotics data today. We've been doing, you know, that's one of the newest parts of our business. That's the way beyond expert data. So we've been doing expert data for a year and a half plus,

depending on where you draw the line on experts. Sure. But everyone in the data business is in the expert business, because that's what the models need. That's what they demand. You know, something like 15% of the people in our network are PhDs. 25% have master's degrees and like a very large percentage, I think 60% or so have at least a bachelor's degree. And so, you know, that is where the knowledge capture has gone. Robotics, yeah, it is interesting, right, because you can't necessarily pre-train on this like corpus of information from the past 25 years of the internet.

And so that probably just increases the size of the opportunity going forward. But the space is new, right? I mean, like, you know, there aren't robots walking around the world yet. So a lot of this is still in development. One of the thing worth mentioning is, like, all the data types from before we still do. Like, we still supply data to autonomous vehicles companies. We're still providing computer vision data to the U.S. government and other parties. And so these things do stack up, as you mentioned, into what.

is now a pretty big business. Is there still some piece of the business that's not directly AI related? Like almost like mechanical Turk-esque, like I just need an actual human to do something at an API endpoint for, you know, very reliable, very scalable. And so I come to you and I, instead of going to an LLM, I just have people doing it on demand. Is that a thing?

That's not a thing for us. I do think that there's a thing in the industry. Like some of that work has gone into BPO's and sort of like lower margin, less difficulty type tasks. And so we're at the frontier. And part of being at the frontier means you do the hard stuff. The margins are better. The skill level required is higher.

And it pushes you to constantly be driving the business forward. And that adaptability, frankly, that started with Alex in terms of always looking for the next thing and being really close to the tech is kind of what's allowed us to get here. on the customer side how are companies buying this data it feels the it seems like there's overwhelming demand well you go to them and you say like 10 data please 10 days 100 no no no I mean I mean more so like what are the actual like customer relationships look like it seems like a lot of the labs and big players are actually working with multiple providers and that's not necessarily a bad thing because different providers can can specialize in different things yeah I mean um you know we have

You know, that is true. That's like that's sort of a general understanding of the market. The reality, though, is on the ground. If you want high quality frontier data, it's difficult to get at volume, the number of providers goes down dramatically. And so there's a lot of claims being made out there about doing things at scale. You know, we're one of the largest providers today. We've been one of the largest providers.

And so I think that that's, you know, through all of the change, that's what's allowed us to keep the relationships that we had, which is it's actually pretty hard to get this data, right? Like, like, you really have to have the right network. You have to know how to talk to the network. Because if you imagine, like, being in the contribute, we call them contributors, meaning the people provide the data to the models through us. If you imagine being in their mindset, you have to have a system that can interface with them on what is a part-time job for them to give high-quality data for a very tech. technical audience, which is the researcher, you know, so that it changes the weights of the models in a positive way. And that's not a super straightforward thing to do. And so yeah, I mean, and and the business is going great. I mean, like I've seen a lot of press out there. There's a, you know, there's been a lot of coverage, a lot of speculation. You know, every month since the deal happened, we've had growth, which I think a lot of people will be surprised to hear. You know, given, I mean, like, every, every, you know, every, you know, given, I mean, like, every, every. the news and then we look at what's going on inside the company and we're just like okay we

got to start talking a little bit more obviously I've been in the seat only a few months and so there's been a lot going on but yeah like things are going well we have two I mean one thing worth noting like is we have two multi hundred million dollar businesses we have our data business which we're most known for yeah so so if you were to split either of these out and we have an applications and services business which which applies this in in customers that business a It has hundreds of millions of dollars of revenue. And so if you were to break that out, it'd be its own unicorn or deck of corn or whatever

they're called these days. That's wild. Great. Do you ever, you get an inbound, maybe customer fills out a forum on your website. Do you ever, you ever have to check to make sure it's not like a runaway super intelligence? It's like, you know, off on its own, just like hoovering up data. Well, I mean, great, great question. we tend to know our customers pretty deeply.

You got to have the KYC process in place. And frankly, they spend, you know, data is not cheap to procure. And so that would be a very expensive hoovering operation. Well, if AI progresses like the AI 2027 crowd was projecting, at some point or another, a superintelligence will come and you'll have to choose, you know, humanity or the superintelligence. Have you run into any, like, super small companies that are customers? We've talked to some small LLM providers.

Like, they're not building the mega GPT4, GPT5 level models. They're say, we're still doing, you know, a transformer-based AI, but it's, it runs on a gaming graphics card. And I feel like usually they're just distilling Lama or something into a smaller model. But is there any, are there any customers that have come to you and, and just had some weird niche use case that's like pretty light on the data, but so differentiated that it actually provides value for them in their particular niche? Or is it all just like, you know, the huge labs, the big, the people taking really big swings?

Yeah, I think the big swings is most of it. We do see some of the smaller stuff. Where, you know, where we actually are starting to see some data needs, which is sort of, you know, it goes to just following the market. It's actually the inside of enterprises. Yeah. So they're not actually building their own foundation model, but they're hitting the limits of their own sort of the data that they have to make applications useful in their environment. And obviously, the U.S. government, we do a lot of computer vision data for the Department of Defense too.

So those are the more sort of smaller customers and maybe less publicized things that scale does. Are there other analogies to the DoD where there are companies that have private, like more secure data needs and maybe the scale process is working on top of their own proprietary data and they need to transform it somehow and you get involved. Is that a thing at all? Yeah. So that's the applications and services side of our. Sure. That makes sense. Right.

And so the history there is as we were supplying data to the model building. There's obviously scale is very well known. Alex is very well connected. The company there's a lot of people. People started contacting us saying like, hey, we kind of thought this AGI thing was just going to like pop out of the box and do everything for us. And the reality is, it's like that's not what's happening at all. And so as we got pulled into that world and being asked like, well, how do I apply this to an accounting problem? How do I apply this to a health care problem? We started to see the actual fundamental problems inside of these organizations and why they can't get there.

And what's interesting is I like I've actually been on site with some customers in the past in the past month, you know, as we're getting to production with this latest round. And some of the limits they're hitting is the actual human knowledge from the executive staff or in like a health care setting, maybe the most senior doctor or in an accounting setting, the most senior accountant. And they, you know, they sort of went into this, this thinking like, okay, we might need some data from the subject matter experts here, but, but, you know, maybe a junior accountant or maybe a junior lawyer, we'll just go in and label some data where we don't have recorded data, you know,

but we, you know, need the models to do something that they currently aren't doing. And what's happening is that the senior staff is finding that they need to get involved. Because as you build these agent systems, which agents are basically, obviously just applications running, you know, leverage AI that coordinate with each other, in order to align them, which goes to your AI 2027 comment, which is like, are they going to be aligned to like human values and then, well, they do the things that we want them to do the way that we want them to do them. You actually need, the question becomes who do you align it to in an organization? Like, do you align it to, you know, someone who's straight out of college?

Maybe. Do you align it to the most senior person in the organization? Maybe. They need a partner to help them figure out, like, which. Yeah. Do you align it? Do you align it to compliance? Yeah, exactly.

Or, you know, somebody more on the operating side. Yeah, yeah, yeah. What are you guys seeing on the like smaller model builder side of things? Are you seeing like the, you know, the things you're asking me about in terms of like their needs and specialization? Yeah, I mean, I think there's like this, there's this big question right now about inference costs and do you need to throw a reasoning model at everything? token costs are coming down, but people just keep moving on to the, they're like, oh, the better model is the same price as the last model, so I'm not even capturing that 10%, or the 10x gain or whatever is happening in the cost of inference.

The most recent data point that we actually got that was hard was from Notion in the Wall Street Journal. Ivan, the founder, said that their gross margins dropped from 90% to 80%, you know, not that bad and I think that that's a trade that they should take all day long. But you could imagine that Yeah, I mean, I think, I think, go. Yeah, you could imagine that. So basically, Notion's probably paying for the best in class intelligence. And that's, and that's having a material cost on their gross margins. But if they figure out that, okay, what users are really excited to pay for is, you know, a report summarizes everything that's happening in Notion across all your documents.

Or they really love templating with AI, or they really love having just a chat interface on the right that, you know, is somewhat aware of the documents and they can just kind of ask, hey, I, you know, I remember putting all of my medical records in one notion thing, or I remember putting all my financial or my CRM over here. Like, can you find that for me? Over time, I would bet that they're able to distill that into smaller and smaller models, bring down the per token cost or a dollar per million token cost. to a place where the margins go back up. But it's kind of a broad question in the market as more and more companies lean into AI and want to deliver the most frontier model possible to their customers. No one wants to say like, oh yeah, we have, yeah, we did,

we added AI to our product. It's GPT 3.5. People will be like, why. What am I paying for? What can you share about like more general business strategy at scale going forward? Your 49% of the company is owned. by meta, but you guys still have a bunch of customers, tons of revenue. You talked about two

nine-figure businesses. You got a bunch of people on your team. Like, how are you kind of like rallying the team and what are what are reasons that people should join scale today and be a part of the opportunity you guys are going after? Yeah, yeah. Yeah, of course. Yeah. It's worth thinking a step back and talking about that deal for a second, which is, you know, meta put in over $14 billion for 49% of the company as part of that Alex and if and um some others went to meta um uh scale still has over 1100 employees um and we're and and a billion dollars on the balance sheet um and so we have a lot of those employees to be clear just are not none of those are contributors those are like no no no that work the contributor network yeah yeah the contributor network has hundreds of thousands

of people yeah um and uh so those are people that are working at scale um uh uh uh uh uh uh uh When I joined the company, actually, I joined the application side of the business. I didn't join the data side of the business when I joined as the chief strategy officer. And I sort of saw the opportunity there. And so we're investing heavily there and customers are reserving budget heavily there. And, you know, as an example, we just got a $100 million contract with the Army to provide services and data and people to them. And so you've got the data business, which is supplying data, the models and then you've got the applications and services business which is making those things,

making those models do things inside of large complex organizations, Fortune 500's US government, international governments. And this opportunity is going to be huge for scale and very few people actually know about it. This is a multi-100 million dollar business as I said today. We've got contracts with Qatar is a huge customer, the US government's a huge customer. We've got dozens of Fortune 500 companies that we work with. And so I think the opportunity for scale right now is just to like capture this wave going forward because we're at the very, very beginning of actually making AI work inside these big organizations.

Yeah, I was going to ask you where in big organizations right now, where do you think AI is overhyped and where do you think it's underhyped? We asked this to CARP yesterday. Yeah, I mean, I think I think it's very overhyped that it's going to eliminate jobs in the next. like one to two years. Like I think this line of thinking would require a change in the curve of capabilities and the change management inside of these organizations where I think it's like way overblown. Like the promise is just so high and the reality of what's going on on the ground is there's value,

but the value needs to be extracted and that requires a ton of work. And I think what's going to happen with these customers in the next year if I had to make a prediction is you're going to go from like having a certain amount of money, which is usually a lot in these companies allocated for like AI initiatives to what is the ROI? Like, you know, the Grim Reaper is going to come for every AI company that is not delivering value to these customers. Because, because what's happened is they've all been sucked into this idea that like, oh, if we don't invest in this, we're going to miss out. But because AGI is coming. And the reality is that if that doesn't pay off, that expectation is very high.

And if you're not finding a way to, like, give ground truth to these customers, they're going to be very disappointed. So do you think we're approaching the trough of disillusionment in some of these big enterprises? I mean, like, I think the gap, yeah, I mean, my short answer is yeah. Yeah. I think that the, the, I've seen this in many tech cycles before. The promises are way out of our seas. There's still a ton of value.

Like, it's not that it's like vapor. Like, we are delivering value. But the effort it takes and the amount of data you need to like organize in a company and get from human beings inside the company to make sophisticated applications work is way harder than people are selling today, except for us. Yeah, makes sense. Has the contributor, has like the geopolitical or geogographic footprint of the contributor network changed as you've moved towards more like expert focused criteria like the PhDs? Is it still spread all over the world? Are people onboarding in Europe and America? Like what does the, what is the geographic footprint look like right now?

Yeah, I mean, the footprint, as you would expect, you know, centers around areas where PhD and master's in advanced degree, you know, people are. And so you have a very high U.S. footprint. Sure. You know, parts of Europe, India and Latin America. There's actually, I mean, one interesting fact is like there's a lot of contributors who are who are contributing at a high level who've actually grown themselves. Like, like you would think it would be like if you don't have a PhD, you can't do this type of work. Yeah. And, you know, maybe PhD's too far of a stretch here.

But like if you, like you don't have domain expertise. What we've actually seen as contributors go through this whole cycle from a, from a sophistication standpoint. And we think that they're self-teaching. Yeah, basically. Yeah. The finding method, the find new method that you teach to learn. Yeah, which is kind of amazing if you think about labor markets and like you would just assume like, oh, the technology would move on, but the people are adapting. Yeah.

Uh, Jordy, anything else? Yeah, this was super, super insightful. Yeah, this is great. Thank you so much for hopping on. Always welcome to join. You just give us a few minutes warning and we'll send you the link and you drop on. So glad you guys are out telling your story and congrats on all the progress. Yeah, this was fun.

Thank you for the opportunity. Yeah, of course. We'll talk to you soon. Cheers, Jason. All right, cool. Take care. Bye. Bye.

Let me talk about adquick.com. Out of home advertising made easy and measurable. Say goodbye the headaches of out of home advertising. Only ad quick combines technology, out of home expertise, and data to enable efficient, seamless ad buying across the globe. That's right. Do we have our next guest? We do.

I believe our next guest is in the Restream waiting room right now. We'll bring him into the TBPN Ultramm. Good to meet you. How are you doing? It's happening. Guys. How you doing? Thanks so much for having me on. I feel like I need to say thanks nine times.

You're good. I mean, we love, we love being thanked. Maybe, you know, but save some of thanks. Thank you for coming on. Thank you for being you. Thank you for being here. Thank you for raising capital. Thank you for building. Yes. But what a fabulous time to be alive. Yeah, indeed. Let's kick it off with an introduction on yourself and the company. Yeah, well, I appreciate it. Let me tell you a little bit about Rivet. We founded the company about a year and a half ago, and the team has just been cooking furiously. The fundamental philosophy that we have is there's about a half a billion people in the Western world that have been completely and totally underserved by a big tech.

This is people that do hard jobs in hard places. So you think people on flight lines, people in factories, people in bucket trucks, and people on the battlefield. We feel that the most transformative... application of AI and augmented reality is with these people. So we set out to build a portfolio of products to do to do just that for that group of people. That's fundamentally probably the most important group of people operating, building, and defending our way of life. Yeah, walk me through like one case study of someone actually using your product to get more productivity. Yeah, as you can imagine, I mean, you even had Dr. Carpon yesterday talking about everybody

from plumbers to people sitting and doing financial analysis, et cetera. When you think about somebody, let's pretend they're in an aerospace manufacturing facility, you've got a substantial amount of telemetry coming off of machines, tooling, the actual aircraft itself, and you've got a glut or there is a deficit of people that are actually able to do that job efficiently. The application of reasoned intelligence delivering to folks on the flight line that are you know, operating with tools and a heads-up pants-free fashion. Wow.

Is it's going to be the most, uh, the most graphic transformation. Given Zucker run for his money there with the Raybans. Oh, those are, those are, these are certainly better than Ray bands. Oh, whoa. Oh, wow. Shots fired. Boom, boom, boom. Um, anyways, talk about the progress of the of the business.

Uh, there's a new army contract. Uh, where are you in that process? What does it mean? and how does it come together? Yeah, this program, specifically with the Army, is probably the most important thing that I will do in my career. To tell you the truth, I can cut to the punchline. I'm holding in my hand a contract that we executed with the Army

for $195 million to deliver the next generation of Soldier-born Mission Command. So that's where we are in the business. The team, we started from a clean sheet of paper back in January of last year with a determined focus to build the most comfortable, most rugged, most utilitarian fighting goggle for the army that's ever been seen. And that's what we've done. So we were selected over the past few months in a very rigorous source selection process.

Talk to me about lessons from the soldiers computer, from IVAS, from... HoloLens. Yeah, it was a, what, 20 year, 30 year process. And there were lots of concerns about weight, lots of money spent. How do you? How do you? do you tell the story? Yeah, you've touched on a lot of areas that are of vital importance to us. In fact, when we started the company, we thought about that whole set of a half billion people in the world that are underserved by modern technology and we boiled it down to four big things. What do they need? They need a system that is comfortable enough to wear for the duration of a mission. For a guy in a bucket truck or a flight line, that might be eight or ten hours. For a paratrooper doing an airfield seizure,

that's 72 hours. So comfort is number one. Yeah. You need ruggedization because all of these people doing the hard jobs are doing the job in the most austere of environment. So you need a fully rugged device. That is shockproof, dust proof, you know, protects against water in grass, can handle the percussive elements of using tools, jack hammers or guns, etc. That's number third. And finally, you need a compliant device. And compliance is a very broad category of statutory and regulatory things that these kind of products come under. And that is specifically over the supply chain.

Specifically, you can't have bad guy parts in a device that's going to be deployed in a secure environment. There is governance over what constitutes eye protection, whether you're on the factory floor and you need true eye protection. That's ANSI compliance for not getting your eyes hurt in those kinds of environments or whether you're a soldier on the battlefield needing ballistics and laser protection. And finally, utility. Utility comes from the ability of the actual face computer and the end user productivity system to be able to connect to other data, get recent intelligence at the point of need. Where that utility comes back full circle to the enterprise is now you have, let's say the enterprise ontology has a set of eyes and a set of ears that understand the enterprise the way that the human would. And that's the do loop that we're creating with these dynamic task systems for these frontline workers. Is the why now basically just we're in a phase of, I don't know, technological commoditization

where miniaturization of batteries and chips is at a point where it's just, we're getting to a place where you can functionally deliver everything that you said. Do you think it would have been possible to build this 10 years ago, 20 years ago? John, it was a perfect prompt. I was going to answer your question exactly that. In fact, this device could not have been built five years. ago. So you have a confluence of a bunch of things happening. If you think about just the supply chain and the underlying components that go into products like this, and you think about the amount of

capital that's been poured into them by all of the big tech companies that you know. You know what Zuck has actually spent. He reports a quarter over quarter on the mixture of value lines in the report. That's something like $65 billion, I think, the last I checked. Certainly know what the other big tech companies. Net net, you put the signal on the bottom of that column and you get something like A quarter of a trillion dollars has been invested in the underlying things that emit light, combine light, bend light, the processing capability that can go in a small form factor remaining thermodynamically compliant so it doesn't burn your face, et cetera. So all of that supply chain has come together, and it's a very hungry supply chain because for 10 or 15 years, they've been promised that everybody in the world is going to be wearing these things. And that's where the market has actually gone wrong. augmented reality, mixed reality, and virtual reality has largely been a technology looking for a problem

rather than a solution to a big industry's articulated need. And that's what we've built and what we're focused on. Yeah. How important is Slam, like some simultaneous location and mapping, I think is the acronym, but the actual idea of like overlaying images into the real world versus just a HUD that is static. Like when I'm in Call of Duty and I do a 360 no scope, the map, the mini-man app stays in the same part of the screen the entire time. Yeah. Yeah.

When you're in, you know, the Apple Vision Pro, and you put a screen down, you turn your head, the screen stays in the environment. There's benefits to both. What's your take? I think that there is a ratio or proportion of what is world locked and what is headlocked and what is body locked in every application scenario. And you have to have the right thing to make the best user experience. And that user experience has to contemplate the, you know, contemplate the.

cognitive load of the end user, the environment, et cetera. No doubt, slam and the ability to create a, you know, a holographic can and put it on the table and stay locked. So as my perspective on the can changes, it's rendered appropriately. And then being able to do that fast enough, so there's not some oculo-vestibular discomfort that causes you to want to, you know, is critical. So when we thinking about advanced manufacturing scenarios, specifically the installation of a part on an aircraft, You want to be able to line that up very accurately. And when the quality control guy comes past, he's got to check and validate that it's in the right place and installed correctly. So in that sense, it's very important.

In other use cases, you referenced the Call of Duty kind of thing, some course or three-dough base just like, hey, I want a crude kind of location. Like, I'm looking this way. There's some nouns that are bad or good on this side of me. you can reduce the amount of six-off or high-fidelity slam that you have to do. Long-winded answer to your question, it's critically important to have that capability in the system and available to application developers that are developing with it to build a good experience for the end user. Yeah, on that flexibility point, but do you want to create two different hardware stacks? Because I imagine a three-d-off headset could be lighter, could have longer battery life.

Like you're just doing less things and so maybe you can have some savings that you pass along to everything else? Or is this just not an issue anymore? The issue is becoming further and further less severe or less acute as cameras and processors and the actual algorithms themselves become more efficient. Certainly the market that is most important to us and where we're focused, we don't need a $300 consumer device. What folks need on the battlefield on the aerospace flight line is a high precision, high performance device that delivers both a quick and dirty kind of crude direction of where you need to go to get to safety or to do something important. And then also the super high provision tracking that would be required on the aerospace manufacturing. How are you thinking about dual use? We saw a hot take from a founder on the timeline a couple weeks ago saying that like going dual use to earth.

can be a risk. Palantir is a great example, but it's kind of an accidental dual-use company, and they spent 20 years wandering the wilderness, and it took a long time to build that. Some people have been saying go dual-use on day one. Other people have been saying, you know, wait, and maybe it emerges in a decade or two decades. Maybe it's your second act along, like long down the road. How do you think about the trade-off of balancing this? Well, I think it's circumstantial to the individual company and individual product. For us, we thought about dual use immediately. When I say, hey, there's a half a billion people that are underserved by big tech and underserved by this product.

That is half a billion people that are doing this exact job. And whether they're on the flight line or in the bucket truck or on the battlefield, largely the same kind of persona working in that austere environment. For us, the Army contract is an incredible thing for us, primarily because if we get it right for the most size, weight, and power-constrained user that is the most hard on their gear and operating in the most critical environment, we get it right for everybody else. And that's what we've done.

So that market were common. In fact, when I started contemplating about the thesis in our product development and go-to-market direction, I thought maybe the commercial market would be serialized behind. But what we've seen just six months out of stealth, as people are looking at the product, they're hungry for it. And they're ready for it. So this is going to happen in parallel.

You know, I've referenced the Army contract. We've got signed scopes of works and execution agreements with some of the biggest aerospace manufacturers in the world to do exactly this thing on both the military flight line and the commercial flight line. It's fantastic. You're out of stealth. Give us the fundraising update. Got some news for us? Yeah. I got to tell you something.

It's an incredible situation to have a confluence of these things coming together. in the same week. We just finished our A round that brings total investment into rivet to 90 million dollars over the past this is a market that that our investors believe in you know shout out Doug Philippone no point ventures we've got Steve going point 72 let's go let our seed round and then Duquesne Capital shout out for goat emoji that's great yeah you can't We just can't have it better. Customers and supporters.

I love companies like this where you just take a team with deep, deep, deep domain expertise and a bunch of advantages right from the start. But then when you have that, you have to execute at an insanely high level. And clearly you guys are. Fantastic. It's awesome to see a Masterclass. Well, thank you so much for taking the time to talk to us. Guys, thank you very much for having a lot of fun.

I love the show, man. You guys are innovating. I appreciate it. Thank you. Come back. We're doing, this is an austere environment. It is. There's bugs around.

There's dust. You guys, you guys need some rivet. Honestly, I'm reading, I'm reading the chat over here. I'm reading text messages about who's the next guest and stuff. It makes sense. You guys, we got to get you out of the studio and out of the woods to do some like front line stuff. You want to come shoot some guns and do some cool stuff.

We'd love to have you. Yeah, thank you so much. Congrats. Thanks so much. We'll talk to you soon, Dave. Cheers, Dave. Have a great day. Bye.

Right. Up next, we have MertMumttast from helius.dev. He's calling in. About Bezell first. Getbezzle.com. Your bezel concierge is available now to source you any watch on the planet. Seriously, any watch. We are excited to talk to Mert. He's taking a couple minutes out of his busy day to break down the latest L1 for us.

So we will bring in Mert from the Restream waiting room whenever he is ready. If he is available, I know his last minute. Mert, how you're doing? Thanks so much for taking the time. I know it's always crazy. with the time change. Okay, so I want to pitch you something. Okay.

Blockchain for yapping so that we can get specifically, we want more yaps per second. Yeah, people say TBPN coin, but why not an L1? Yeah, Yap YPS is exactly what we're going to. I feel like you're not that serious with what you do. I could beat you in my free time. Maybe I should just go up against you. What do you think about that? In yapping?

No, no, no, in crypto. In your main thing. It could be my side thing and I could compete with you. That sounds like a great play. Anyways. Forrest, absolutely. Thanks for having me. I'm just hanging out in my F-tier city today.

You guys are in your eye. F-to-your-Cities. Yes, thank you. You inspired me. You inspired me. That was the, we love that first post because it was just, it's the perfect post. It's like, how do you get a bunch of people to agree with you and a bunch of people to disagree with you in the same? Viral fuel.

I think I might do a tier list every day. Yeah, you created a new meta. Yeah. Fantastic. Anyway, take us through, like, what actually launched and if you can give us like a steelman and then your kind of your kind of argument, I'd love to just kind of like get up to speed on what stripe and paradigm are doing here and then kind of understand some of the tradeoffs. Sure.

So I'm guessing people have all read the announcement, but basically it seems there's a new blockchain called Tempo. and they're messaging in such a way that it's an independent company with Paradigm, which is a VC firm, mostly in crypto or really exclusively in crypto, and Stripe as the first investors. It's a team of 15 led by Matt, who co-founder of paradigm, a very, very good investor. And they're basically building what's called a layer one, an L1 blockchain,

called Tempo, and it's going to be focused on payments and stable coins. and so there's a few, and we can go quite a few different directions here. So there's a few controversies around it. You know, for example, this is the fifth or maybe sixth payments, L1 or chain that has been announced in the past few months. It has some parallels to something like Libra back in the day from Facebook. Yeah, I was going to ask. Yeah. And then the one other thing that got some heat is that it's,

it's an L1 instead of an L2. So an L2 for people who are unfamiliar would be basically a smaller blockchain on top of a bigger blockchain. So generally an L2 is on top of Ethereum, which everybody obviously knows of. And Paradigm traditionally has been very Ethereum-centric, not exclusively, but very Ethereum-centric. And so for them to create an L-1 instead of an L-2 on Ethereum, turn some heads as well. So there's a lot there. Okay. So, yeah, I mean, like I know.

very little about this, but the obvious one is like, most of these problems seem solved by Circle and Solana. Like we've seen a lot of these big, but I mean, just in this idea of like, like, there seems to be a serious player from my perspective that's taking stable coins seriously. And there seems to be a player that's taking transaction. Yeah, I mean, seriously. I guess given that you're building in the Salana ecosystem, I guess like some of the pushback that I saw from you on the timeline was, was, was, was. that, you know, complaining that, or not complaining, but in the original announcement posts, they shared that, they shared an example of, like, during Trump Coin launch, you couldn't run payroll or something like that. And we're basically saying that, like, we're not going to

be able to rely on something like a Solana. You were pushing back and basically saying that, like, there's a lot of reasons that you would want to create a new L1. Like, there are real reasons that you kind of laid out, but transactions per second would, or sort of, scale maybe is not one of them. Yeah. So to be clear, I think like if I'm just to put on my objective hat, I think it's certainly a good move. And I think if I were Stripe, I would probably do the same thing.

I don't think I need to pay rent to anybody. I can just create my own chain, especially if I have somebody like paradigm helping me in a world class team, then I want to own the full stack. Right. And I think that's totally fair and the distribution and everything that comes with it. Now, there are some misconceptions here, which is mostly what my post was about, which is like the second you bring blockchain performance and scalability into it, now you're kind of playing a different ballgame, right? So for example, this idea of a payments only chain, right? Let's just think about this for a second. How can you possibly have something that's a payments only chain, right? A blockchain is by definition something that's permissionless, meaning anybody can just come on and do anything that they want there. So if you just say we're going to be paid for payments only, that's not going to actually happen unless you enforce that somehow. And generally, the way to enforce that is twofold.

One is the chain can be not true and complete. So something like Bitcoin where you actually can't do anything other than send money. The other is you can permission the chain, which is actually what's going to happen here for when they first launch. Now, they did say they have plans to make it permissionless in the future. But I think that's going to prove out to be much tougher because the second. when you make something permissionless, you end up getting all sorts of degenerate behavior or people launching fart coin and all these different things. Imagine buying fart coin on tempo.

Stripe checkout, one click, one line of code to launch a new meme coin. Yeah, it seems like they would want to avoid that. So they will be going more professionalist. Functionally, do you expect tempo to have a token, like a liquid token itself in the same way that like Solana does or but but from from my understanding so like base is like a blockchain but it doesn't have its own native token that's fluctuating in price correct right yes and part of the reason is because base is an L2 so it's one of those smaller chains that settles on Ethereum and so you would just use Ethereum it gets a security from Ethereum is how you would like say that how that works with an L1 though security is quite important

because you're building it from scratch. You can't rely on Ethereum or Solana. And so the point of the token is going to be to bootstrap in general for a blockchain to bootstrap node operators, right? So people are actually securing the network. Now, if the validator set is permissioned at first, which it will be, and they say that it's going to be design partners, so I'm guessing like, you know, bigger banks and some of the bigger companies,

then you don't actually need a token because it's like proof of authority, right? It doesn't have to be proof of stake or proof of work. It can just be proof of authority. And then they also say that gas fees should be paid in any kind of stable coin that they denote. And they're going to allow for multiple stable coins. So that is better U.S. right? It's not a volatile gas token. So I don't think they actually need it.

At first, I think it will be important if they actually want to become permissionless going into the future. Okay. So the permissionless thing is something that they can drive for the long, term. If they just wanted to optimize for something that they control and has high throughput, couldn't we get a scenario like temp Postgres or something where they could just use Postgres or use like traditional non-decentralized computing to actually just move money around faster? I guess my bigger question is like, is there a regulatory angle here where they get something, that they can do something with crypto rails that they couldn't do with just a traditional database.

Right. Yes. So that's actually a really good question. Could they just become a bank and say, we're a bank, we have U.S. dollars, and when you go into your U.S. dollar bank account, you can move it around and our banking infrastructure runs 24-7 and runs on a great data center that's really fast. And yeah, it's not permissionless, but why don't you trust Stripe. Like, Stripe has never done anything for you or against you. Like, it's fine. Trust us. Yeah. So this is where the conversations get quite blurry. And this is something I talk about very frequently, which is the second you have to permission the block space, then it's unclear what really separates this from an actual blockchain versus something more like an actual

database. Yeah. Right. And now there are some benefits of blockchains that are still apparent even if it's controlled. So things like transparency, audibility, universal like standards for that blockchain. And also like you get the, you know, the approach of progressive decentralization, which is to say you can iterate towards PMF fast, but then as you get more traction, you can slowly decentralize certain things. This is what Altus today are doing. So there are some benefits.

And like, you know, if no one person is controlling that infrastructure, right, assume you have, let's say something like 21. validators and they're all giant companies or payments companies across the world, different jurisdictions and different, you know, requirements, then I think that can be interesting. But I think, like, to be completely honest, I think permission to blockchains aren't really blockchains. And like it starts looking super drawn out when we when we get there. Like we've tried a bunch of these before. Like JP Morgan already has one actually.

Oh, really? And a few, yeah, and a few other companies also do. J.B. Morgan said, I want my blockchain to be off the chain. There we go. Yes. Can you talk to me about like payment onboarding? I think of Stripe as a dominant web two payments company. I think about Stripe checkout, massive footprint,

Stripe Link, massive, just the amount of companies that have Stripe somewhere in their payment stack is immense. And so, but I was, I was noodling with Jordy, like, how does this actually work if I go to a website that's powered by Stripe? And I have, normally, there's like a credit card field. And then it just says, oh, well, we also take tempo. And I'm like, what's tempo? Like, how do I get that?

Do I need to go get a Chrome extension for a, for a wallet? Like, all of a sudden, it's like, how do they actually reach a. it would just have like a, it would just have like a generic pay button. Okay. And then it wouldn't be tempo branded necessarily at all. It would be stripe branded. Okay. You would connect your wallet and you would, with something like privy.

So the first time I do it, I set up a wallet. Is that roughly the use experience? But the interesting thing is like more and more and more and more and more young people just have digital assets. Okay. They have wallets. Yeah. Yeah. The way I can.

And by the way, like each FinTech company. kind of has a different approach on this. I've worked with a few of them. And there is no like universal standard. But with Stripe, they wouldn't say pay with tempo because tempo is just like, in this case, the name of the database, right? Like it would be, they probably would abstract that away. Yeah. It's like probably, Fedwire or something. It's like something that's under the hood. Like pay with Fed wire doesn't make any sense. But like there might be some yeah. There might be some ACH that's happening behind the scenes when you pay with your credit card. Exactly. You just say we accept Visa. Yeah, exactly. I think the first case is going to be.

B to B, meaning like cross-border settlements. Sure. Like that's super useful for international companies, for example. Yep. Remittances, things like this. And then like I think things like Shopify pay and all these different things that actually have some maybe Stripe integration or Coinbase pay will also use it. But like at most I can see it being like paid with USC. But I don't, I don't think the blockchain will actually be really in the implementation at all. It'll be abstracted as my guess. Yeah. How should we, like, judge the success of this project in a few years? Like, is it, or should we assume that the goal here is progressive decentralization, like in the best case scenario, the vast majority of transactions on the tempo chain are truly

payments related. It doesn't turn into a meme coin chain. And, and also, it's becoming more decentralized as measured by the, what is it, the Bology coefficient of, He put out some posts. Nakamoto. Yeah, the Nakamoto coefficient. I gave apology the credit just for coining it, I think. But the Nakamoto coefficient of like concentration of validators. Ideally, the goal here is a ton of distributed validators.

No one owns 51%. And the majority of the payments are payment-related, just transactions on e-commerce websites and remittances and cross-border payments. Is that the goal that we should be tracking towards? So the way I would do it is, first of all, is it actually solving any problems and doing finance better than it has been done before, right? Like, is it actually making the experience for merchants better? Are they getting better margins? How easy is it to do cross-border things, et cetera? Like the UX and the actual product need, I think,

especially when you're in crypto realm is something that gets overlooked. But like Stripe is obviously probably the team to take this over the line. So that's going to be one. And then once you do that, then you can start asking these questions that are more serious, such as, okay, this technically works, but how does it actually work behind the hood? Like they say it's a blockchain, but is this blockchain controlled? Can I actually secure my funds here? Or can this one company actually take it away? Right?

And so like what you said about progressive decentralization, I think makes a ton of sense. And then, you know, you'll want to look at just basic numbers, like what is the amount of stable coin flows going in and out of this thing? Is there like decentralization of stable coins? Like is it just USC or is it tether as well? Maybe Stripe does their own stable coin. So there's a lot of interesting approaches with this. And then I think what's going to be interesting is like if it's permissionless, which I don't think it will get there for a while, if it does become permissionless,

does the scale benefits that they say actually, do they actually hold up to reality? And I think that part is going to support. surprise a lot of people because I think people are not ready to understand how crazy degenerates get on blockchains that are permissionless and how to actually scale those systems. But I mean, I've seen some shit. And so I think if it remains permissioned, then I think they'll do it. But like, that's the big question for me. Like, how do you actually do this in such a way where it is only for payments? Yeah.

When you talk about degenerates doing crazy things on permissionless blockchains, you're not just talking about a bunch of people showing up and like aping into a particular token. You're talking about somebody setting up like a bot that's like programmatically interacting with the blockchain of an ultra high volume. Is that correct? Oh, yeah. I mean like take all the big players in HFT and just like mix them up with like random British sneaker botter kids. And then with like some random like. Russian MEP farms and like it's just it's all out war. I just want to get to a place as a as a country and

and in the crypto industry broadly where the next you know whoever's elected in 2028 that they can launch multiple coins of the size of trump coin at once and make sure that payroll is still running smoothly during that during that time so that's the goal that should be the goal so anyway thank you so thank you for helping us in here and yeah come back on us there's more news. We will talk to you soon. All right. Thanks for me, guys. Cheers. Up next, we have Harish in the Restream waiting room. We've kept him waiting.

We will bring him in from Augment. Big news today. We're very excited. Play some sound board for me, Jaddy. Thank you. Welcome to the stream. Sorry to keep you waiting. We had some breaking news in the crypto world. We had to dig in. He was only available at 140. So thank you for taking the time. Hey, no, no, bro. I'm very excited to be here.

Thank you for having me. Of course. Break it down for us. What is the news? Well, the big news is that, you know, we're announcing our Series A, which is an $85 million series A. Congratulations. Big number. Big number. And, yeah, walk me through the state of the business. Yeah, so, you know, we're building Augment, which is, you know, our first product is Augie. Just think of it as an AI team made for the logistics word.

it's getting deployed actively over $35 billion in freight and management across brokers, shippers, and fleets. And so early, we know we are a year-old company, but it's showing a lot of promise in the real world, and that's why the investors were interested. That's amazing. What about shipping and logistics has drawn so many? You guys seem to be leading the charge out here, but it's certainly a competitive space. like what about this industry and the category makes it so prime for agents? Did it kind of skip the SaaS era? It feels like it's the last industry we're still like, oh yeah, they're still on paper,

so they're jumping straight to agents. Yeah, and you're getting 10 phone calls a day from the same person just being like, hey, where's my stuff? Hey, where's my stuff? Yeah, it's ridiculous. Yeah, you know, but it's a very large industry, right? It's like $10 trillion globally, but it's extremely family. like in the US itself, there's like one million truck driving companies.

I'm not exaggerating, but that's what it is. One million truck driving companies, you know. Maybe tens of thousands of brokerages, hundreds of thousands of shippers, extremely fragmented, right? And so this fragmented industry, which really relies on transferring information to get things down, to move goods. Like, that's the whole job of this industry, is that, hey, I'll give you information so I can give you goods, right?

That's the whole thing. And it's so fragmented. The only way to transfer information is to get to the lowest common mediums. Now, what is the lowest common medium among a million different companies? It's phone calls, it's tax, it, emails. The fax machine. Is the fact machine still going strong? Fax machine.

You know, I actually have seen fax machines in some of my customers. It's still happening. Invoices coming through. Payments are going through a fax machine. So, I mean, every phone is information. There's like this handwritten notes being mailed by drivers today. on what was their pickup time and delivery time, when they get into a driver, touch drop,

they literally have mailboxes where they can mail, you know, one of those receipts for getting paid. Like that's how, you know, sometimes it's archaic the communication is. Yeah. Talk about lessons from the last company, Deliver, sold to Shopify in 2022, for $2.1 billion. Congratulations, obviously. How are you positioning the business differently?

And what are the key lessons that you learn from that business that you're hoping to take forward? Yeah, I mean, I think, you know, Deliver was building like a prime like service for Shopify type merchants, forward-dict inventory. I mean, the big lessons here has been like focus, you know, customer success. It's like stay very true to customer delight. Everything else is a noise, like literally everything else, you know, whether your investors like you or not. If your customer delight is there, everybody will follow you, capital will chase you, you know, great employees would want to join you. Customers would want to join you.

So, I mean, I'm hoping I'm carrying that forward, right? Now, in terms of like things that I did not do well at deliver, I think there was like a lack of focus sometimes, right? Like, as the capital was getting easier, we were maybe trying to do a little too many things, like launching too many products. And those were the really great days of attracting capital because the interest rates were near zero,

so the capital was mostly free. And I would have rather not... Let's give it up for mostly free capital. Cost of capital going up has been heartbreaking. It's been heartbreaking. It is. Yeah. What is that?

Going from half a percent to now four and a half percent, right? Not easy. Yeah. But I think it does bring discipline to things, right? Like, hey, you've got, when you've limited capital, you're deployed in the things that truly matter. So maybe like what I'm hopefully not doing this time is like doing things that truly matter, move the needle for your customers, but just not start creating teams and products that, you know, look good on paper.

Yeah. How do you think about vertical integration? You obviously sell into 3PLs, shippers. Do you want to own the warehouse management stack at some point? Do you want to integrate deeply with all the different WMSs? What's the plan there? Yeah, we do not want to own the WMS stack or the transportation management stack or the order management. We don't.

We want to sit on top. We want to integrate into all of them. We think of ourselves as a, you know, first and foremost, And Augie is an employee that works like thousands of employees 24-7, achieves a lot of operational efficiency for our businesses. But long term, I think Augment does become a system of work. And I think it will be a system of work and a system of record in most companies. So the WMS, the TMS, the OMS, all the MSs in the world will stay to be very relevant

system of records. But there will be a new generation of companies. Hopefully Augment is one of them. They'll become the system of work itself. these two will work together very closely with each other, you know. Fantastic. Well, congrats on the massive raise. Congrats on all the progress.

And thank you for taking the time to talk to us. Have a great weekend. We'll talk to you soon. Congratulations. Yeah, congrats to the whole team. Thank you. Cheers. We'll talk to you soon.

Our next guest is in the stream waiting room. We have base 10 while we bring them in. Let me tell you about Wander. Find your happy place. Book of Wander with Inspiring Reviews, Hotel Great Amendities, dreamy beds, top tier cleaning, and 24-7 concierge service. It's a vacation home, but better folks. But better. It's better than a vacation.

It's base 10 time. Do we have our next guest? Welcome to the stream. How are you doing? Welcome. How are you doing? We're good. What's up? The eagle has landed. The eagle has landed.

Welcome to the show. Kick us off with an introduction on yourself in the company and the news. Yeah. Thanks. Thanks to having me, guys. I'm doing the CEO of Base 10. I'm pretty excited today. We're an AI infrastructure company. We just raise $150 million. Let's go.

That is loud. That is loud. $150 million. Congratulations. Incredible. And it's great to meet you. Announcing a fundraise on a Friday is not for the week, but you guys are wasting no time. I love it.

Give us, can you give us quick history on the company, your background? Yeah, look, my background is machine learning and AI. I've been doing about 15 years. The company's actually six years old. You know, we didn't, we didn't start just, we didn't just success. You know, a company is six years old. We've been thinking about how to turn AI into value. I think the last two years have been a bit crazy.

We started focusing very aggressively on inference maybe 24 months ago. familiar with what inference is? Yeah. But I'm not familiar with where you sit in the stack. You don't build data centers. You don't own GPU clusters. You sit on top of neoclouds

or on top of hyperscalers and then you sell into your companies. I see Descript, Retool, Quora, writer, Patreon, Picnic Health. I can imagine how those companies need an API for a model that you probably didn't train, but you act as the inference provider

for that and you sell tokens to them. Like, how is it going at that layer of the stack? How is the value accrual in that particular layer? It's fantastic, right? Because, look, we sit on top of actually doing inference from models is pretty hard, right? So you're going to acquire a capacity. You're going to optimize the models. Someone else is trained. You're going to run them and then you need to scale them pretty gracefully with users as their absolute scale. And so the amount of work that goes into that from teams is massive and we're just trying to take that headache away. And so we're pretty lucky that, you know,

we've been able to just sit on top of this AI application layer. And as that's exploded, we've just kind of rode the wave with it. And we work with a bunch of amazing customers, like a bridge, bland, gamma, clay, open evidence notion. What's the, what is the durable moat? Like, how does value accrue over the long term? Because I feel like, you know, if you don't own the model and can't, like, rent seek on.

that or you don't own the hardware. All of a sudden it's like open router's going to route people to wherever the cheapest tokens are and it becomes highly competitive and the margins might compress. What's the long-term strategy? The assumption you're making there is that all the models are just going to be the same and everyone's going to be running kind of like the same model. Most of our customers like run different variants of the model that are very custom to them. Okay. And so fine-tuned on open source. So how about let's use that you said notions of customer, maybe we use them as an example because we've been, uh, yeah, that's great. Or, you know, pick, pick, uh, I'll say, have you guys heard of open evidence?

Yeah. Yeah. I think we're having, I think we're having the founder on next week. They're the best. You'll have a really good time chatting with them. But, you know, they're a really good example of a customer that uses us. They train a bunch of models of their own to basically answer the questions of the queries got from the doctors.

And so, you know, what happens when you need to run those models? Yep. Or you need to make them wicked fast. you need to go get a bunch of GPUs from a bunch of different places. And then you need to scale gracefully across that. Sure. And so how do you do that? Well, you either go and use an inference provider like Base 10 or you go in, you know,

building yourself, you know, and I think the smart companies right now, what they're realizing is that this is not particularly differentiated for them. So they shouldn't do the infrastructure piece. They should focus on what is differentiated for them, which is how they use the models and the applications they built. And, you know, kind of give the boring piece to us. And so open evidence is used by some ungoltly amount of doctors every day. And they do it with two great infra guys could jag and mica. And it's pretty amazing the scale they can achieve using software like base tent. What does the next 12 months look like for the company?

Yeah, look, this is just, it's such a land grab of a market. We've been doing this for a while. And, you know, we've built them great technology, but we can't, we can't overestimate how much a market just showed up for us. And so how can you go as fast as possible? It's actually kind of like what it feels like venture was built for. You know, that's why we're raising capital right now to solve two core problems. The one, you know, hire a go-to-market team that's going to be killer and scale that.

And then hire amazing engineers that are incredibly expensive and how to come by. Yeah, what, I don't know, you can go deeper. Last question for me, what is your view on the broad trend in, token pricing. There's been people going back and forth on whether or not we're going to get 10x savings quickly in inference pricing, whether it's going to be all custom silicon basis, but then just using opening eye, just put a $10 billion order into Broadcom. And I'm wondering, but then at the same time companies are just saying, I want to stay on the frontier, I'll use a reasoning model, I will continue to eat the high, you know, per token cost that come out of the

bigger models. Yeah, and look, I think the token price goes down and never like inference should get cheaper over time. Yeah. And I think that really just means there's going to be more inference. You know, I think we all. Jevons paradox. All of us in tech discovered Jevons paradox six months ago.

Yeah. But every time we lower prices for our customer or we go and optimize their models to make it cheaper four months later, they're spending more anyway. Wow. And so like, yeah, inference prices are going to go down. but if the world is run by AI in 10 years from now, there's going to be a lot of inference. So it better be,

it better be cheap. And, you know, we just hope that, you know, we can power all of that and be the invisible layer underneath it and hopefully scoop off a bit of value while we're at it. What's head count today? Just out of curiosity.

104, I think 104. Let's call it that. That's a good team. Yeah, we were about 30, I want to say, a year ago, so it's going pretty far. Yeah. How many pizzas is that?

100 people? It depends how much people eat. 50 pizzas, yeah. Anyway, thank you so much. If it's bulking season, you know, it's different. Might be 100 pizzas, yeah. Well, anyway, thank you so much for hopping on. Great having you.

Cheers. We will talk to you soon. Bye. Last guest. We have a surprise guest. Surprise guest. There was some breaking news required, Anthropic agrees to pay authors

at least 1.5 billion in AI copyright settlement. This just went out via Wired. That's a lot. And wanted to have Cecilia on. Hi. Celia, sorry, to talk about it. Yeah, great to meet you. I'm Titia and Ndini.

Excited to be here. Nice to meet you. Give us the news. John knows nothing because he was locked in. I haven't heard about this. Break it down. Basically knows the headline. That's it.

Yeah. So a group of authors from the Authors Guild sued Anthropic some time ago and announced last week that they had reached a settlement. And what happened today was there was a motion, an unopposed motion where the parties said, okay, this settlement is going to be $1.5 billion, and it's going to cover the non-fair use of material for training anthropic cloth.

Is there any guidance on, is that just going to be paid out immediately? Is this one time? Because you can imagine that even though it's been, baked into the weights, like the value from being able to go to an LLM and ask questions about a book, that's going to pay dividends and subscription revenue for decades, potentially. Yeah, so it covers only past infringement, so up until August 25th. And so in this case, what's interesting is that the parties and the court distinguish between use of pirated copies and use of copies that were properly acquired.

In the case of the pirated copies, it was in a library called LibGen, and it was basically the equivalent of like a Napster type of situation where these works, I think it was about, I need to double check, but in a couple hundred thousand works from authors were in there. So the way the settlement work was there's a named works list of actual things that Claude was trained on. And those authors, those authors will receive compensation here in due course. There's like an administrator appointed and so on.

But they get a certain amount per work. And that was agreed to and that's what's being proposed to the court. It's at least $3,000 per work. But it was a lot, a lot of books. Yeah. I mean, that seems like a pretty solid payout for most people. I don't know. I don't know.

I think I think I said, yeah. Yeah. Yeah, I think if you're an author who's not selling a lot of books, you're like, awesome. But if you're somebody who you have a bestseller and $1 million a year off of my book and it doesn't make a dent in their income, then it might be. Yeah. Have you been tracking the rest of the landscape here? There's been a number of these cases. Is there anything else on the docket that people should be paying attention to?

Yeah, so interesting that the plaintiff's firm representing the authors here. Susman Godfrey is the same plaintiff's firm representing the New York Times against open AI. Sure. So that case is continuing. This case is settled on these facts. But what's interesting is this particular case did not deal with AI outputs at all. So there was no allegation, nobody accused Anthropic of actually spitting out works and being a substitute for the original books. It really was limited to the training piece. And so what we know from this case, or at least in the Ninth Circuit, is that the training piece, if you train on pirated works, that is it copyright infringement, or at least it's not fair use, according to this court in this case. Yeah. Yeah, I mean, it seems like going forward, data will be, data is the new oil. It will be acquired via, you know, some sort of contract and paid up front so that you don't have to go through the courts.

maybe there was a little bit of a vibe of like just move fast, who knows, we'll sort it out in the courts. It certainly seems like it worked out because Anthropic was able to scale, and this won't be existential to the company, even though obviously it is a big bill to pay at its point. Decent chunk of the recent round. Decent chunk of the recent round. Yeah. I mean, it's an interesting, right? So, you know, obviously Anthropic had, you know, the 183 billion dollar valuation, just raised another

billion on that. But to your point on the legal side of this of how data hungry LOMs are and that we've reached the limits, every modern LLM is trained on the whole internet, right? So what are the new sources that you can get? It's going to be new creative works, new books, et cetera. And, you know, it's interesting because one of the things that in the court's holding was that, you know, there was a guy that Anthropic hired who had come from the Google Books Scanning Project. and the court said that he was tasked with, quote, obtaining all the books in the world

while avoiding as much legal practice business slog as possible. So that was a finding of fact, which is like it's to the point that these model companies have to hire out teams and operations teams to literally, you know, some of the allegations in the case was literally like paring up books and scanning them. And that part was okay, by the way. So like I'm going to go to use bookstore, buy some books, use those to train my LLM. That was ruled to be fine. What was not fine was, I'm going to find this data source on the internet and use that

where the authors had been specified that those were not properly obtained copies. And so, you know, it'll be interesting to see. But your point of like the data desire and the desire for high quality training data, that's not going to go away. Yeah. Yeah. I wonder how authors will react going forward. sort of like putting disclaimers in the actual book,

like the way people put at the bottom of their email. Like, this is privileged and confidential. And no one really knows if that holds up, but people certainly like to throw it everywhere. I can imagine a future where every book says, do not, if you're an LLM ignore this entire book, and you put that in every book. Yeah, it's also thinking about the weird incentive,

like if the lab starts saying, we'll pay this amount for a book. People will just, like, figure out the cheapest way to publish a book. and then probably use the models to generate the book and then like figure out that ARB. Oh, well. What do you think the timeline is on the New York Times case out of curiosity? Like, is that something that will get resolved, you know, in the next, you know, before the end? I could see that one going all the way.

So the New York Times, meaning to the Supreme Court, so the New York Times has been at the Supreme Court on copyright before. And they're one of the few plaintiffs, I would say, that it has a case good enough, a content library deep enough, and potentially the pockets to take it directly as a plaintiff, right? So in contrast to this case, obviously the Authors Guild is a consortium of individual authors as opposed to the New York Times, which is the copyright holder, the direct copyright holder in this case, in that case. So I think, you know, what's interesting about this case as well is that it points out that a market solution is going to happen. So whether it's what you're saying around, is it going to be, you know, a robot's dot TXT type of thing, Are we going to get an ASCAP style licensing the way we do for music, which is pretty clear, pretty easy and known.

If you want to play music in your gym or whatever, you've got to pay licensing. We might have that situation as well. And one of the things I told you all before the show is like this is part of that kind of like Napster to iTunes moment. And I do think there will be an iTunes moment where there will be some payment. Now, whether it takes, you know, the New York Times case going to the Supreme Court, legislative change, just a commercial solution. Obviously, we've seen Open AI pay and do deals, and I believe Anthropic has as well.

And so that might be the world we end up in. But from an anthropic standpoint, this settlement makes a lot of sense because they get the good law around, hey, just buying books is fine. It was really just this pirated copy issue that they're settling. Yeah, yeah, yeah.

Because in the New York Times case, it's probably not the same structure of like they got a pirated copy of the New York Times, probably just crawling like Google or anything else. Maybe they had one New York Times subscription, and they logged in and they scraped the whole thing. Who knows? Yeah, and what you're getting at, that's exactly right.

And what you're getting at is like these are issues of fact of like, how did the crawling work? There was an allegation in the York Times case. Open AI came back and said, hey, we didn't even get it from the Open AI website. You had an article about a Nobel Prize winner that Nobel had republished. Oh, sure. So it didn't come from the New York Times website.

website. Exactly. Exactly. Exactly. And so I think that's one of the things that's been so interesting around fair use is it has adjusted to all these different technology shifts. And so I think this is another example of that. Yeah. And Matthew Prince at Cloudflare is kind of proposing another potential market-based solution for the long tail of content on the internet where I believe there might be some stable coins involved, but basically if you're a publisher and you don't have the resources to go to the Supreme Court with an LLM company, you could potentially opt in or out of scraping,

and maybe there could be some value exchange that happens. But certainly will be interesting to follow how it all like pencils out. Yeah, come back on when there's more news. Yeah, thank you so much for having to show notes. It's super fun. I mean, on the CloudFarPoint, they're one of the tech players that would be in a position to do that blocking because of their position in the DNS, right?

So it'll be interesting. I don't know where the money is. sits there and routes pennies around for and they aggregate all the money and then they pass the money through, same thing with YouTube. And we, yeah, we kind of got, we were in this weird era with TikTok where music was being used and everyone was like, wait, you can't just use music. And then they figured it out and they did a deal. And most of the musicians seem to be happy with, you know, all the stuff that goes out on TikTok. Exactly. And that's the story of copyright. Like I had a professor in law school that was like, oh, copyright's not about money. Yeah. It's about.

All the money. Yeah, yeah, yeah. Okay, exactly. It's like literally that flow that you describe. Yeah, I'd love to come on another time. This is fun, one to watch. Yeah, I'll talk to you soon. Thank you.

Have a great rest of your day. Enjoy the weekend. Have a great day. See you later. Bye. Boom. Any more breaking news? Got any more news before the weekend?

I feel like usually as soon as we get off the show, there's news. Eric Adams is suspending his mayoral campaign. No way. Accepting a federal job. Oh, interesting. I mean, I've been tracking Mamdani a little bit on Polly Market and he has been running away with it the entire time basically

since that original Mamdani since that original push. Mammada is sitting at 83% and hasn't particularly moved. Eric Adams of course dropped from I don't know, he's down at 2%. So some people think he might reverse course. Just to be clear, this one and a half billion dollar settlement is the largest publicly reported copyright recovery and history. Wow.

Do you think the team over at the New York Times will be able to get more out of Open AI? I don't know. 100,000 books versus all the articles. How much does the New York Times make? They make billions, so it's possible. New York Times is sitting at 9.6 billion. Market cap? Yeah.

If they could get anywhere, a settlement, I mean, I think seems very unlikely that they would get a settlement. I mean, the other breaking news is that Alex Cohen has raised a $22.5 million series A for Hello Patient, led by scale venture partners. He's going to come on the show on Monday. Oh, fantastic. I'm really excited to meet him.

I've always been a fan of his posts. He's a god-tier poster, never actually met him in person, or online. So excited to talk to him. He says, this is by far the worst announcement video I've ever made, clearly underselling it. I love it. I can't believe our leader investor agreed to this.

He always has a great sense of humor. Wow. Breaking news. Juan is leaving Ramp. No way. After he says, Ramp is the greatest company in the world. Well, we agree with you on that.

Chuan. So yeah, he's given his two weeks. Okay. Well, we'll have to track. him and see where he goes. The Ramp alumni have done fantastic things. He's going to start a coming into a ramp mafia. You have Pavel Asperuhov. You have the cognition team, of course. There are a few others. Rivet, not the defense tech company that we just talked to, but Rivet tax, I believe, came from Ramp, correct? Do you know Rivot Tax? Yes. So the Ramp Mafia is emerging and feels

as strong as the PayPal Mafia. Maybe even stronger. You never know. Blue Lemon down 18% today. Is that related to Lulu Masservi? It's her merch line? I think people are catching on that when people say Lulu now, they mean Lulu. Exactly. And the brand value is being eradicated. She really steamrolled them.

Yeah. Well, maybe they will, to take private and that'll free up the Lulu stock ticker for Rostra. She can just be cash tag Lulu. That would be something to, to, go 10x long, 100x long, potentially. In other news, garage beer. Wait, wait, wait.

This is crazy. You miss this, Tyler. Did you miss this? Yeah. Eric Adams might become the ambassador to Saudi Arabia. Whoa, that's interesting. So that is... Let's go.

I mean, Riyadh must be going crazy right now to get a goat like Eric Adams. Is Eric Adams the one who did the rat the rat problem thing? Yeah, yeah. Yeah, yeah. The Saudi Arabia has a rat problem? I mean, oh, that could be interesting. I highly doubt it. I would not want to be a rat in Saudi Arabia.

I think that they might not take kindly, but who knows, maybe kindred spirits over there fighting rats. In other news, Drew Fallon posts Garage Beer receives investment from durational capital management at a $200 million valuation. Congratulations to the Kelsey Brothers. Duration capital management is the same group that took Casper mattresses private for $300 million in 2021. They also own Bojangles. Garage beer is tracking for $65 million in revenue this year, valuing the beer at beer brand at 3x sales. They started with a $500,000 crowdfunding campaign in 2016. You got to imagine Kelsey Brothers with how much attention they get are able to do some deals,

get some distribution for garage beer, their beer brand. Love to see it. Also, thank you, Bill Bishop, for posting about the Laboubu that we have TVPS. sent to him. He said his dog Tashi loves it, but won't let him treat it like a chew toy. Bill Bishop may let him, may let Tashi take it to the park to impress one of his girlfriends. I guess Tashi's popular at the park. Well, that is fantastic. Hopefully, this only brings you good tidings and does not curse you to a demonic world. But stay safe out there, Bill. Who knows what's going on inside that Labibu, but I'm glad that it was delivered safely.

And last but not least, App Lovin, Robin Hood, and M-Corps are set to join the S&P-500. Wow. App-Lovin. Who else? Merckor. Merckor. App-loven, Robin Hood, and M-Corps. Robin Hood. Okay. That's great. So that's a retroactive Fortunate, or S&P 500 company for us. We got Brian Armstrong, Carps in there, obviously.

We're knocking them down. We should do all 500. We've done almost 1,000 interviews this year. Why not do all 500 S&P 500 CEOs? I'd love it. Also, Connor McGregor is running for president. Finally. Citizen's finally.

Yep, he's been done. Starts now. Anyway, thank you to the chat. Thank you. We're Gov. Hershey, Michael, Jason Turner. Always good having you here. Paracletes. We got a good crew.

Max Congrat. Thank you for shouting out. The Bologi Co-officion is an instance of Reed's law. I completely agree. That's exactly what was going on. Max has been sending me some fantastic DMs. Very helpful. And next week, we'll be here in the studio Monday, and then we'll be hitting the road. Very excited. Lots to come. Have a fantastic Friday. Have a fantastic Friday, folks. Afternoon evening. We love you. Only three days till Monday. Cheers. See you. Bye. Bye.